Post on 16-Jan-2023
Placement Document
Not for Circulation and Strictly Confidential
Serial Number: [●]
Hindustan Copper Limited
Hindustan Copper Limited (the “Company” or the “Issuer”) was incorporated as a government company under the provisions of the Companies Act, 1956 as Hindustan Copper (Private) Limited
by a certificate of incorporation dated November 9, 1967 from the Registrar of Companies, Jaipur, Rajasthan. Subsequently, our Company became a public limited company pursuant to a
shareholders’ resolution dated February 27, 1968 and the name of our Company was changed to Hindustan Copper Limited and our Company received a fresh certificate of incorporation on March
26, 1968.
Registered and Corporate Office: Tamra Bhavan, 1, Ashutosh Chowdhury Avenue, Kolkata 700 019, West Bengal, India.
Telephone: +91 33 2283 2226 | Facsimile: +91 33 2283 2478 | E-mail: : singhi_cs@hindustancopper.com| Website: www.hindustancopper.com | CIN: L27201WB1967GOI028825
Our Company is issuing 4,18,06,020 equity shares of face value of Rs. 5 each (the “Equity Shares”) at a price of Rs. 119.60 per Equity Share, including a premium of Rs. 114.60 per Equity Share,
aggregating to an amount up to Rs. 50,000.00 lakhs (the “Issue”). For further details, please see section titled “Summary of the Issue” on page 24.
ISSUE IN RELIANCE UPON CHAPTER VI OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS)
REGULATIONS, 2018, AS AMENDED (THE “SEBI ICDR REGULATIONS”), AND SECTION 42 OF THE COMPANIES ACT, 2013, AS AMENDED, READ WITH RULE 14
OF THE COMPANIES (PROSPECTUS AND ALLOTMENT OF SECURITIES) RULES, 2014 AND OTHER APPLICABLE PROVISIONS OF THE COMPANIES ACT AND
THE RULES MADE THEREUNDER.
THIS ISSUE AND DISTRIBUTION OF THIS PLACEMENT DOCUMENT IS BEING MADE TO QUALIFIED INSTITUTIONAL BUYERS AS DEFINED UNDER THE SEBI ICDR
REGULATIONS (“QIBS”) IN RELIANCE UPON CHAPTER VI OF THE SEBI ICDR REGULATIONS AND SECTION 42 OF THE COMPANIES ACT, 2013, AS AMENDED,
READ WITH RULE 14 OF THE COMPANIES (PROSPECTUS & ALLOTMENT OF SECURITIES) RULES, 2014 AND OTHER APPLICABLE PROVISIONS OF THE
COMPANIES ACT AND THE RULES MADE THEREUNDER. THIS PLACEMENT DOCUMENT IS PERSONAL TO EACH PROSPECTIVE INVESTOR AND DOES NOT
CONSTITUTE AN OFFER OR INVITATION OR SOLICITATION OF AN OFFER TO THE PUBLIC OR TO ANY OTHER PERSON OR CLASS OF INVESTORS WITHIN OR
OUTSIDE INDIA OTHER THAN QIBS. THIS PLACEMENT DOCUMENT (WHICH INCLUDES DISCLOSURES PRESCRIBED UNDER FORM PAS-4) WILL BE CIRCULATED
ONLY TO SUCH QIBS WHOSE NAMES ARE RECORDED BY OUR COMPANY PRIOR TO MAKING AN INVITATION TO SUBSCRIBE TO EQUITY SHARES.
YOU MAY NOT AND ARE NOT AUTHORISED TO (1) DELIVER THIS PLACEMENT DOCUMENT TO ANY OTHER PERSON; OR (2) REPRODUCE THIS PLACEMENT
DOCUMENT IN ANY MANNER WHATSOEVER; OR (3) RELEASE ANY PUBLIC ADVERTISEMENT OR UTILISE ANY MEDIA, MARKETING OR DISTRIBUTION
CHANNELS OR AGENTS TO INFORM THE PUBLIC AT LARGE ABOUT THIS ISSUE. ANY DISTRIBUTION OR REPRODUCTION OF THIS PLACEMENT DOCUMENT IN
WHOLE OR IN PART IS UNAUTHORISED. FAILURE TO COMPLY WITH THIS INSTRUCTION MAY RESULT IN A VIOLATION OF THE SEBI ICDR REGULATIONS OR
OTHER APPLICABLE LAWS OF INDIA AND/OR OTHER JURISDICTIONS.
INVESTMENTS IN THE EQUITY SHARES INVOLVE A HIGH DEGREE OF RISK AND PROSPECTIVE INVESTORS SHOULD NOT INVEST IN THIS ISSUE UNLESS THEY
ARE PREPARED TO TAKE THE RISK OF LOSING ALL OR PART OF THEIR INVESTMENT. PROSPECTIVE INVESTORS ARE ADVISED TO CAREFULLY READ THE
SECTION “RISK FACTORS” ON PAGE 40 BEFORE MAKING AN INVESTMENT DECISION RELATING TO THE EQUITY SHARES IN THE ISSUE. EACH PROSPECTIVE
INVESTOR IS ADVISED TO CONSULT ITS OWN ADVISORS ABOUT THE PARTICULAR CONSEQUENCES OF AN INVESTMENT IN THE EQUITY SHARES BEING
ISSUED PURSUANT TO THIS PLACEMENT DOCUMENT AND PLACEMENT DOCUMENT. PROSPECTIVE INVESTORS SHOULD CONDUCT THEIR OWN DUE
DILIGENCE ON THE EQUITY SHARES AND THE COMPANY. IF YOU DO NOT UNDERSTAND THE CONTENTS OF THIS PLACEMENT DOCUMENT, YOU SHOULD
CONSULT AN AUTHORISED FINANCIAL ADVISOR AND/OR LEGAL ADVISOR.
The Equity Shares are listed on BSE Limited (the “BSE”) and National Stock Exchange of India Limited (the “NSE”, and together with the BSE, referred to as the “Stock Exchanges”). The
closing price of the outstanding Equity Shares on BSE and NSE on April 9, 2021 was Rs. 143.65 and Rs. 143.80 per Equity Share, respectively. In-principle approvals under Regulation 28(1) of
the SEBI Listing Regulations (as hereinafter defined) for listing of the Equity Shares have been received from BSE and NSE on April 7, 2021. Applications to the Stock Exchanges will be made
for obtaining final listing and trading approvals for the Equity Shares to be issued pursuant to the Issue on the Stock Exchanges. The Stock Exchanges assume no responsibility for the correctness
of any statements made, opinions expressed and/or reports contained herein. Admission of the Equity Shares to trading on the Stock Exchanges should not be taken as an indication of the merits
of our Company or of the Equity Shares.
A copy of this Placement Document (which includes disclosures prescribed under Form PAS-4 (as hereinafter defined)) has been delivered to the Stock Exchanges, and a copy of the Placement
Document (which shall include disclosures prescribed under Form PAS-4) shall also be delivered to the Stock Exchanges. Our Company shall also make the requisite filings with the Registrar of
Companies, West Bengal (the “RoC”), and the Securities and Exchange Board of India (“SEBI”), each within the stipulated period as required under SEBI ICDR Regulations and the Companies
Act, 2013 and the Companies (Prospectus and Allotment of Securities) Rules, 2014, as amended. This Placement Document has not been reviewed by SEBI, the Stock Exchanges, the RoC or any
other regulatory or listing authority and is intended only for use by QIBs. This Placement Document has not been and will not be registered as a prospectus with the registrar of companies in India
and will not be circulated or distributed to the public in India or any other jurisdiction. The Issue is meant only for QIBs by way of a private placement and will not constitute a public offer in India
or any other jurisdiction.
Invitations for subscription, offer and sale of the Equity Shares to be issued pursuant to this Issue shall only be made pursuant to the Preliminary Placement Document together with
the Placement Document, the Application Form and Confirmation of Allocation Note (as hereinafter defined). For further details, please see section titled “Issue Procedure” on page
159. The distribution of this Placement Document or the disclosure of its contents without prior consent of our Company to any person, other than QIBs and persons retained by QIBs
to advise them with respect to their purchase of Equity Shares, is unauthorised and prohibited. Each prospective investor, by accepting delivery of this Placement Document, agrees to
observe the foregoing restrictions and make no copies of this Placement Document and/or any of the documents referred to in this Placement Document.
The information on the website of our Company, any website directly or indirectly linked to our Company’s website, or the website of the Book Running Lead Managers or their
affiliates does not form part of this Placement Document and prospective investors should not rely on such information contained in, or available through, any such websites.
The Equity Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state of the United
States and, unless so registered, may not be offered or sold within the United States, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements
of the Securities Act and applicable U.S. state securities laws. Accordingly, the Equity Shares are being offered and sold only outside the United States in ‘offshore transactions’ (as
defined in Regulation S under the Securities Act (“Regulation S”)) in reliance on Regulations S and the applicable laws of the jurisdiction where those offers and sales are made. For a
description of the selling restrictions in certain other jurisdictions, please see section titled “Selling Restrictions” on page 174. The Equity Shares are transferrable only in accordance
with the restrictions described in “Transfer Restrictions” on page 182.
Our Company has prepared this Placement Document solely for providing information in connection with the proposed Issue.
This Placement Document is dated April 12, 2021.
BOOK RUNNING LEAD MANAGERS
IDBI Capital Markets & Securities Limited SBI Capital Markets Limited
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TABLE OF CONTENTS
NOTICE TO INVESTORS .................................................................................................................................. 3 REPRESENTATIONS BY INVESTORS .......................................................................................................... 5 OFFSHORE DERIVATIVE INSTRUMENTS ................................................................................................ 10 DISCLAIMER CLAUSE OF THE STOCK EXCHANGES .......................................................................... 11 PRESENTATION OF FINANCIAL AND OTHER INFORMATION ......................................................... 12 FORWARD-LOOKING STATEMENTS ........................................................................................................ 14 INDUSTRY AND MARKET DATA................................................................................................................. 16 ENFORCEMENT OF CIVIL LIABILITIES .................................................................................................. 17 EXCHANGE RATE INFORMATION ............................................................................................................ 18 DEFINITIONS AND ABBREVIATIONS ........................................................................................................ 19 SUMMARY OF THE ISSUE ............................................................................................................................ 24 SUMMARY FINANCIAL INFORMATION ................................................................................................... 26 RELATED PARTY TRANSACTIONS ............................................................................................................ 38 SUMMARY OF BUSINESS .............................................................................................................................. 39 RISK FACTORS ................................................................................................................................................ 40 MARKET PRICE INFORMATION ................................................................................................................ 65 USE OF PROCEEDS ......................................................................................................................................... 68 CAPITALISATION STATEMENT AND FINANCIAL INDEBTEDNESS ................................................. 71 CAPITAL STRUCTURE ................................................................................................................................... 72 DIVIDENDS ........................................................................................................................................................ 76 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS ............................................................................................................................................. 77 INDUSTRY OVERVIEW ................................................................................................................................ 108 OUR BUSINESS ............................................................................................................................................... 124 REGULATIONS AND POLICIES ................................................................................................................. 143 BOARD OF DIRECTORS AND SENIOR MANAGEMENT ...................................................................... 146 PRINCIPAL SHAREHOLDERS .................................................................................................................... 157 ISSUE PROCEDURE ...................................................................................................................................... 159 PLACEMENT AND LOCK-UP ...................................................................................................................... 172 SELLING RESTRICTIONS ........................................................................................................................... 174 TRANSFER RESTRICTIONS ........................................................................................................................ 182 THE SECURITIES MARKET OF INDIA..................................................................................................... 184 DESCRIPTION OF THE EQUITY SHARES ............................................................................................... 187 STATEMENT OF TAX BENEFITS............................................................................................................... 191 LEGAL PROCEEDINGS ................................................................................................................................ 195 STATUTORY AUDITORS ............................................................................................................................. 201 GENERAL INFORMATION .......................................................................................................................... 202 FINANCIAL STATEMENTS ......................................................................................................................... 204 DETAILS OF PROPOSED ALLOTTEES .................................................................................................... 205 DECLARATION .............................................................................................................................................. 206 SAMPLE APPLICATION FORM.................................................................................................................. 208
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NOTICE TO INVESTORS
Our Company has furnished and accepts full responsibility for all of the information contained in this and confirms
that to our best knowledge and belief, having made all reasonable enquiries, this Placement Document contains all
information with respect to our Company and Subsidiary and the Equity Shares which is material in the context of
this Issue. The statements contained in this Placement Document relating to our Company and Subsidiary and the
Equity Shares are, in all material respects, true and accurate and not misleading, and the opinions and intentions
expressed in this Placement Document with regard to our Company and Subsidiary and the Equity Shares are honestly
held, have been reached after considering all relevant circumstances and are based on reasonable assumptions and
information presently available to our Company. There are no other facts in relation to our Company and the Equity
Shares, the omission of which would, in the context of this Issue, make any statement in this Placement Document
misleading in any material respect. Further, our Company has made all reasonable enquiries to ascertain such facts
and to verify the accuracy of all such information and statements. The information contained in this Placement
Document has been provided by our Company and other sources identified herein. Distribution of this Placement
Document to any person other than the investor specified by the Book Running Lead Managers or their representatives,
and those persons, if any, retained to advise such investor with respect thereto, is unauthorised, and any disclosure of
its contents, without prior written consent of our Company, is prohibited. Any reproduction or distribution of this
Placement Document, in whole or in part, and any disclosure of its contents to any other person is prohibited.
The Book Running Lead Managers have not separately verified all the information contained in this Placement
Document (financial, legal or otherwise). Accordingly, none of the Book Running Lead Managers or any of their
respective shareholders, employees, counsel, officers, directors, representatives, agents or affiliates makes any express
or implied representation, warranty or undertaking, and no responsibility or liability is accepted by the Book Running
Lead Managers or their respective shareholders, employees, counsels, officers, directors, representatives, agents or
affiliates, as to the accuracy or completeness of the information contained in this Placement Document or any other
information supplied in connection with our Company and the issue of the Equity Shares or its distribution. Each
person receiving this Placement Document acknowledges that such person has not relied on either of the Book
Running Lead Managers or on any of their respective shareholders, employees, counsel, officers, directors,
representatives, agents and/or affiliates in connection with such person’s investigation of the accuracy of such
information or such person’s investment decision, and each such person must rely on its own examination of our
Company and the merits and risks involved in investing in the Equity Shares, issued pursuant to this Issue.
No person is authorised to give any information or to make any representation not contained in this Placement
Document and any information or representation not so contained must not be relied upon as having been authorised
by or on behalf of our Company or the Book Running Lead Manager. The delivery of this Placement Document at
any time does not imply that the information contained in it is correct as at any time subsequent to its date.
The Equity Shares to be issued pursuant to the Issue have not been approved, disapproved or recommended by any
regulatory authority in any jurisdiction including the United States Securities and Exchange Commission (“SEC”),
any other federal or state authorities in the United States, the securities authorities of any non-United States jurisdiction
or any other United States or non-United States regulatory authority. No authority has passed on or endorsed the merits
of the Issue or the accuracy or adequacy of this Placement Document. Any representation to the contrary may be a
criminal offence in the United States and certain other jurisdictions.
The Equity Shares have not been and will not be registered under the Securities Act, or the securities laws of any state
of the United States and, unless so registered, may not be offered or sold within the United States, except pursuant to
an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable
U.S. state securities laws. For further information, see “Selling Restrictions” and “Transfer Restrictions” on pages
174 and 182, respectively.
The distribution of this Placement Document or the disclosure of its contents without the prior consent of our Company
to any person, other than QIBs whose names are recorded by our Company prior to the invitation to subscribe to this
Issue (in consultation with the Book Running Lead Managers or their representatives) and those retained by QIBs to
advise them with respect to their purchase of the Equity Shares, is unauthorised and prohibited.
Each prospective investor, by accepting delivery of this Placement Document, agrees to observe the foregoing
restrictions and to make no copies of this Placement Document or any documents referred to in this Placement
Document.
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The Equity Shares to be issued pursuant to the Issue have not been approved, disapproved or recommended by any
regulatory authority in any jurisdiction. No authority has passed on or endorsed the merits of the Issue or the accuracy
or adequacy of this Placement Document. Any representation to the contrary may be a criminal offence in certain
jurisdictions.
The distribution of this Placement Document and the issue of the Equity Shares may be restricted in certain
jurisdictions by law. As such, this Placement Document does not constitute, and may not be used for or in connection
with, an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not authorised or to
any person to whom it is unlawful to make such offer or solicitation. No action has been taken by our Company and
the Book Running Lead Managers that would permit an issue of the Equity Shares or the distribution of this Placement
Document in any jurisdiction, other than India, where action for that purpose is required. Accordingly, the Equity
Shares may not be offered or sold, directly or indirectly, and neither this Placement Document nor any other Issue-
related materials in connection with the Equity Shares may be distributed or published in or from any country or
jurisdiction, except under circumstances that will result in compliance with any applicable rules and regulations of
any such country or jurisdiction.
Subscribers of the Equity Shares will be deemed to make the representations, warranties, acknowledgements and
agreements set forth in the section titled “Representations by Investors”, “Selling Restrictions” and “Transfer
Restrictions” on pages 5, 174 and 182 respectively.
In making an investment decision, prospective investors must rely on their own examination of our Company and the
terms of this Issue, including the merits and risks involved. Investors should not construe the contents of this Placement
Document as legal, business, tax, accounting or investment advice. Investors should consult their own counsel and
advisors as to business, investment, legal, tax, accounting and related matters concerning this Issue. In addition, neither
our Company nor the Book Running Lead Managers are making any representation to any investor, or subscriber or
purchaser of the Equity Shares in relation to this Issue regarding the legality of an investment in the Equity Shares in
this Issue, by such investor, or subscriber under applicable legal, investment or similar laws or regulations. Each
subscriber of the Equity Shares in this Issue is deemed to have acknowledged, represented and agreed that it is eligible
to invest in India and in our Company under Indian laws, including Section 42 of the Companies Act, 2013 read with
Rule 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014, and Chapter VI of the SEBI ICDR
Regulations and is not prohibited by SEBI or any other statutory, regulatory or judicial authority in India or any other
jurisdiction from buying, selling or dealing in securities including the Equity Shares, or otherwise accessing the capital
markets in India.
This Placement Document contains summaries of certain terms of certain documents, which summaries are qualified
in their entirety by the terms and conditions of such documents. All references herein to “you” or “your” is to the
prospective investors of the Issue.
The information on our Company’s website, www.hindustancopper.com, any website directly and indirectly linked to
the website of our Company or on the website of the Book Running Lead Managers or their affiliates, neither constitute
nor form part of this Placement Document. Prospective investors should not rely on such information contained in, or
available through, such websites.
NOTICE TO INVESTORS IN CERTAIN OTHER JURISDICTIONS
For information for investors in certain other jurisdictions, see sections “Selling Restrictions” and “Transfer
Restrictions” beginning on pages 174 and 182 respectively, of this Placement Document.
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REPRESENTATIONS BY INVESTORS
References herein to “you” or “your” are to the prospective investors in this Issue. By bidding for and/or subscribing
to any Equity Shares in this Issue, you are deemed to have represented, warranted, acknowledged and agreed with our
Company and the Book Running Lead Managers as follows:
• You are a QIB as defined in Regulation 2(1) (ss) of SEBI ICDR Regulations and not excluded as an eligible investor
pursuant to Regulation 179(2)(b) of the SEBI ICDR Regulations, having a valid and existing registration under
applicable laws and regulations of India, and undertake to acquire, hold, manage or dispose of any Equity Shares that
are Allocated to you in accordance with Chapter VI of the SEBI ICDR Regulations and undertake to comply with the
SEBI ICDR Regulations, the Companies Act and all other applicable laws, including any reporting obligations;
• If you are not a resident of India, but are a QIB, you are an Eligible FPI having a valid and existing certificate of
registration with SEBI under the applicable laws in India or a multilateral or bilateral development financial institution
or an FVCI, and are eligible to invest in India under applicable law, including the FEMA Regulations, and any
notifications, circulars or clarifications issued thereunder, and have not been prohibited by SEBI or any other
regulatory authority from buying, selling or dealing in securities;
• If you are an Eligible FPI, you are investing in the Issue under the Foreign Portfolio Investment Scheme;
• You will make all necessary filings with appropriate regulatory authorities, including the Reserve Bank of India
(“RBI”), as required pursuant to applicable laws;
• If you are Allotted Equity Shares pursuant to the Issue, you shall not, for a period of one year from the date of
Allotment, sell the Equity Shares so acquired, except on the floor of the Stock Exchanges;
• You have made, or are deemed to have made, as applicable, the representations set forth under “Selling Restrictions”
and “Transfer Restrictions” on pages 174 and 182, respectively;
• You understand that the Equity Shares have not been and will not be registered under the Securities Act or registered,
listed or otherwise qualified in any other jurisdictions outside India and may not be offered or sold within the United
States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the
Securities Act. For more information, see “Selling Restrictions” on page 174;
• You are outside the United States and you are purchasing the Equity Shares in an “offshore transaction” within the
meaning of Regulation S and are not our Company’s or the Book Running Lead Managers’ affiliate or a person acting
on behalf of such an affiliate;
• You are not acquiring or subscribing for the Equity Shares as a result of any general solicitation or general advertising
(as those terms are defined in Regulation D under the Securities Act) or “directed selling efforts” (as defined in
Regulation S). You understand and agree that the Equity Shares are transferable only in accordance with the
restrictions described under “Selling Restrictions” and “Transfer Restriction” beginning on pages 174 and 182,
respectively;
• You are aware that the Equity Shares issued pursuant to the Issue have not been and will not be registered through a
prospectus under the Companies Act (as defined hereinafter), the SEBI ICDR Regulations or under any other law in
force in India. This Placement Document (which includes disclosures prescribed under Form PAS- 4) has not been
reviewed or affirmed by the RBI, SEBI, the Stock Exchanges, the RoC or any other regulatory or listing authority and
is intended only for use by QIBs. This Placement Document has been filed (and the Placement Document will be
filed) with the Stock Exchanges for record purposes only and will be displayed on the websites of our Company and
the Stock Exchanges. Our Company shall make the requisite filings with the RoC and the SEBI within the stipulated
period as required under the Companies Act, 2013 and the Companies (Prospectus and Allotment of Securities) Rules,
2014;
• You are entitled to subscribe for and acquire the Equity Shares under the laws of all relevant jurisdictions that apply
to you and that you have fully observed such laws and you have necessary capacity, have obtained all necessary
consents, governmental or otherwise, and authorisations and complied with all necessary formalities, to enable you to
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commit to participation in this Issue and to perform your obligations in relation thereto (including, without limitation,
in the case of any person on whose behalf you are acting, all necessary consents and authorisations to agree to the
terms set out or referred to in this Placement Document), and will honour such obligations;
• You agree that neither our Company nor any of the Book Running Lead Managers or any of their respective
shareholders, directors, officers, employees, counsels, representatives, agents or affiliates are making any
recommendations to you or advising you regarding the suitability of any transactions they may enter into in connection
with this Issue and your participation in this Issue is on the basis that you are not, and will not, up to the Allotment,
be a client of the Book Running Lead Managers. Neither the Book Running Lead Managers nor any of their respective
shareholders, directors, officers, employees, counsel, representatives, agents or affiliates have any duties or
responsibilities to you for providing the protection afforded to their clients or customers or for providing advice in
relation to this Issue and are not in any way acting in any fiduciary capacity;
• You understand that the Equity Shares allotted to you will be locked in and that you shall not undertake any trade in
the Equity Shares credited to your beneficiary account until such time that the final listing and trading approvals for
such Equity Shares are issued by the Stock Exchanges;
• You confirm that, either: (i) you have not participated in or attended any investor meetings or presentations by our
Company or its agents (the “Company Presentations”) with regard to our Company or this Issue; or (ii) if you have
participated in or attended any of our Company Presentations: (a) you understand and acknowledge that the Book
Running Lead Managers may not have knowledge of the statements that our Company or its agents may have made
at such Company Presentations and are therefore unable to determine whether the information provided to you at such
Company Presentations may have included any material misstatements or omissions, and, accordingly you
acknowledge that the Book Running Lead Managers have advised you not to rely in any way on any information that
was provided to you at such Company Presentations, and (b) you confirm that, to the best of your knowledge, you
have not been provided any material information relating to our Company and this Issue that was not publicly
available;
• Your decision to subscribe to the Equity Shares to be issued pursuant to the Issue has not been made on the basis of
any information related to our Company which is not set forth in the Placement Document;
• You are subscribing to the Equity Shares to be issued pursuant to the Issue in accordance with applicable laws and by
participating in this Issue, you are not in violation of any applicable law including but not limited to the SEBI Insider
Trading Regulations, the SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003 and the
Companies Act, 2013 and the rules made thereunder;
• All statements other than statements of historical fact included in this Placement Document, including, without
limitation, those regarding our Company’s future financial position, business strategy, plans and objectives of
management for future operations (including development plans and objectives relating to our Company’s business),
are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties
and other important factors that could cause actual results to be materially different from future results, performance
or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based
on numerous assumptions regarding our Company’s present and future business strategies and environment in which
our Company will operate in the future. You should not place undue reliance on forward-looking statements, which
speak only as at the date of this Placement Document. Neither our Company nor the Book Running Lead Managers
or any of their shareholders, directors, officers, employees, counsel representatives, agents or affiliates assume any
responsibility to update any of the forward-looking statements contained in this Placement Document;
• You are aware and understand that the Equity Shares are being offered only to QIBs on a private placement basis and
are not being offered to the general public, and the Allotment of the same shall be on a discretionary basis at the
discretion of our Company and the Book Running Lead Managers;
• You are aware that if you are Allotted any Equity Shares, our Company is required to disclose details such as your
name, address and the number of Equity Shares Allotted to the RoC and SEBI, and you consent to such disclosures;
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• You are aware that if you are Allotted more than five percent of the Equity Shares in this Issue, our Company is
required to disclose your name and the number of Equity Shares Allotted to the Stock Exchanges and the Stock
Exchanges will make the same available on their website, and you consent to such disclosures;
• You have been provided a serially numbered copy of this Placement Document and have read it in its entirety,
including in particular, the section “Risk Factors” on page 40;
• In making your investment decision, you have (i) relied on your own examination of our Company and the terms of
this Issue, including the merits and risks involved, (ii) made and will continue to make your own assessment of our
Company, the Equity Shares and the terms of this Issue based solely on the information contained in this Placement
Document and the Placement Document and no other disclosure or representation by our Company, its Directors,
Promoter, and affiliates or any other party, (iii) consulted your own independent counsel and advisors (including tax
advisors) or otherwise have satisfied yourself concerning, without limitation, the effects of local laws, (iv) relied solely
on the information contained in this Placement Document and no other disclosure or representation by our Company,
its Directors and affiliates, or any other party, (v) received all information that you believe is necessary or appropriate
in order to make an investment decision in respect of our Company and the Equity Shares, (vi) you will continue to
make your own assessment of the Company and the Equity Shares and the terms of the Issue based on such information
as is publicly available, and (viii) relied upon your own investigation and resources in deciding to invest in this Issue;
• Neither the Book Running Lead Managers nor any of their respective shareholders, directors, officers, employees,
counsel, representatives, agents or affiliates have provided you with any tax advice or otherwise made any
representations regarding the tax consequences of purchase, ownership and disposal of the Equity Shares (including
but not limited to this Issue and the use of the proceeds from the Equity Shares). You will obtain your own independent
tax advice from a reputable service provider and will not rely on the Book Running Lead Managers or any of their
respective shareholders, directors, officers, employees, counsel, representatives, agents or affiliates when evaluating
the tax consequences in relation to the Equity Shares (including but not limited to this Issue and the use of the proceeds
from the Equity Shares). You waive, and agree not to assert any claim against our Company or the Book Running
Lead Managers or any of their shareholders, directors, officers, employees, counsel, representatives, agents or
affiliates with respect to the tax aspects of the Equity Shares or as a result of any tax audits by tax authorities, wherever
situated;
• You are a sophisticated investor and have such knowledge and experience in financial, business and investment
matters as to be capable of evaluating the merits and risks of an investment in the Equity Shares.
• You acknowledge that an investment in the Equity Shares involves a high degree of risk and that the Equity Shares
are, therefore, a speculative investment. You and any accounts for which you are subscribing for the Equity Shares (i)
are each able to bear the economic risk of your investment in the Equity Shares, (ii) will not look to our Company
and/or the Book Running Lead Managers or any of their shareholders, directors, officers, employees, counsel,
representatives, agents or affiliates for all or part of any such loss or losses that may be suffered in connection with
this Issue, including losses arising out of non-performance by our Company of any of its obligations or any breach of
any representations and warranties by our Company, whether to you or otherwise, (iii) are able to sustain a complete
loss on the investment in the Equity Shares, (iv) are seeking to subscribe to the Equity Shares in this Issue for
investment purposes and not with a view to resell or distribute them and you have no reason to anticipate any change
in your or their circumstances, financial or otherwise, which may cause or require any sale or distribution by you or
them of all or any part of the Equity Shares, and (v) have no reason to anticipate any change in your or their
circumstances, financial or otherwise, which may cause or require any sale or distribution by you or them of all or any
part of the Equity Shares;
• When you are acquiring the Equity Shares to be issued pursuant to this Issue for one or more managed accounts, you
represent and warrant that you are authorised in writing, by each such managed account to acquire such Equity Shares
for each managed account and to make (and you hereby make) the representations, warranties, acknowledgements
and agreements herein for and on behalf of each such account, reading the reference to “you” to include such accounts;
• You are not a ‘promoter’ (as defined under Section 2(69) of the Companies Act, 2013 and the SEBI ICDR Regulations)
of our Company or any of its affiliates and are not a person related to the promoter, either directly or indirectly and
your Bid does not directly or indirectly represent the ‘promoter’, or ‘promoter group’, (as defined under the SEBI
ICDR Regulations) or person related to promoter of our Company;
8
• You agree that in terms of Section 42(3) of the Companies Act, 2013 and the Companies (Prospectus and Allotment
of Securities) Rules, 2014, we shall file necessary filings with the RoC and if the Allotment of Equity Shares in the
Issue results in you being one of the top 10 shareholders of our Company, we shall also be required to disclose your
name and shareholding details to the RoC within 15 days of Allotment, and you consent to such disclosure being made
by us;
• You are aware that if our Company decides to allocate Equity Shares to you in the Issue, your name and your post-
Issue shareholding (assuming full subscription in the Issue) will be included as a “proposed allottee” in the Issue in
the Placement Document;
• You have no rights under a shareholders’ agreement or voting agreement with the promoter or persons related to the
Promoter, no veto rights or right to appoint any nominee director on the Board of Directors of our Company other
than the rights acquired, if any, in the capacity of a lender not holding any Equity Shares;
• You will have no right to withdraw your Bid after the Bid/Issue Closing Date;
• You are eligible to apply and hold the Equity Shares Allotted to you pursuant to this Issue together with any Equity
Shares held by you prior to this Issue. Further, you confirm that your aggregate holding after the Allotment of the
Equity Shares shall not exceed the level permissible as per any applicable law or regulation;
• The Bid made by you would not result in triggering a tender offer under the Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended (the “Takeover Regulations”);
• To the best of your knowledge and belief, your aggregate holding, together with other QIBs in this Issue that belong
to the same group or are under common control as you, pursuant to the Allotment under this Issue shall not exceed 50
% of this Issue. For the purposes of this representation:
a) the expression ‘belong to the same group’ shall mean entities where (a) any of them controls, directly or
indirectly, through its subsidiary or holding company, not less than 15% of the voting rights in the other; (b) any
of them, directly or indirectly, by itself, or in combination with other persons, exercise control over the others;
or (c) there is a common director, excluding nominee and independent directors, amongst QIBs, its subsidiary or
holding company and any other QIB ; and ‘Control’ shall have the same meaning as is assigned to it by
Regulation 2(1)(e) of the Takeover Regulations;
b) You shall not undertake any trade in the Equity Shares credited to your beneficiary account until such time that
the final listing and trading approvals for such Equity Shares is issued by the Stock Exchanges;
• You are aware that (i) applications for in-principle approval, in terms of Regulation 28(1) of the SEBI Listing
Regulations, for listing and admission of the Equity Shares on the Stock Exchanges were made and approval has been
received from the Stock Exchanges, and (ii) the applications for the final listing and trading approval will be made
only after Allotment. There can be no assurance that the final approvals for listing of the Equity Shares will be obtained
in time or at all. Neither our Company, nor the Book Running Lead Managers, nor any of their shareholders, directors,
officers, employees, counsel, representatives, agents or affiliates shall be responsible for any delay or non-receipt of
such final approval or any loss arising from such delay or non-receipt;
• You are aware and understand that the Book Running Lead Managers have entered into a placement agreement with
our Company, whereby the Book Running Lead Managers have, subject to the satisfaction of certain conditions set
out therein, agreed to manage this Issue and use its reasonable efforts to procure subscriptions for the Equity Shares
on the terms and conditions set forth therein;
• The contents of this Placement Document are exclusively the responsibility of our Company, and neither the Book
Running Lead Managers nor any person acting on their behalf has or shall have any liability for any information,
representation or statement contained in this Placement Document or any information previously published by or on
behalf of our Company and will not be liable for your decision to participate in this Issue based on any information,
representation or statement contained in this Placement Document or otherwise. By accepting a participation in this
Issue, you agree to the same and confirm that the only information you are entitled to rely on, and on which you have
9
relied in committing yourself to acquire the Equity Shares is contained in this Placement Document, such information
being all that you deem necessary to make an investment decision in respect of the Equity Shares, you have neither
received nor relied on any other information, representation, warranty or statement made by or on behalf of the Book
Running Lead Managers or our Company or any of its affiliates or any other person, and neither the Book Running
Lead Managers nor our Company nor any other person will be liable for your decision to participate in this Issue based
on any other information, representation, warranty or statement that you may have obtained or received;
• You understand that the Book Running Lead Managers do not have any obligation to purchase or acquire all or any
part of the Equity Shares purchased by you in this Issue or to support any losses directly or indirectly sustained or
incurred by you for any reason whatsoever in connection with this Issue, including non-performance by our Company
of any of its obligations or any breach of any representations and warranties by our Company, whether to you or
otherwise;
• You are eligible to invest in India under applicable laws, including the FEMA 20, as amended, and any notifications,
circulars or clarifications issued thereunder, and have not been prohibited by SEBI or any other regulatory authority,
from buying, selling or dealing in securities;
• You agree that any dispute arising in connection with this Issue will be governed by and construed in accordance with
the laws of Republic of India, and the courts in Kolkata shall have exclusive jurisdiction to settle any disputes which
may arise out of or in connection with this Placement Document and the Placement Document;
• You agree to indemnify and hold our Company, the Book Running Lead Managers and their respective employees,
officers, agents, directors, affiliates, associates and representatives harmless from any and all costs, claims, liabilities
and expenses (including legal fees and expenses) arising out of or in connection with any breach of the foregoing
representations, warranties, acknowledgements, agreements and undertakings and the those contained in sections titled
“Selling Restrictions” and “Transfer Restrictions” on pages 174 and 182, as made by you in this Placement Document.
You agree that the indemnity set forth in this paragraph shall survive the resale of the Equity Shares by, or on behalf
of, the managed accounts;
• You acknowledge that our Company, the Book Running Lead Managers, their affiliates and others will rely on the
truth and accuracy of the foregoing representations, warranties, acknowledgements and undertakings, which are given
to the Book Running Lead Managers and our Company, are irrevocable;
• You agree that each of the representations, warranties, acknowledgments and agreements set out above shall continue
to be true and accurate at all times up to and including the Allotment, listing and trading of the Equity Shares issued
pursuant to the Issue; and
• You understand that the Equity Shares will when issued pursuant to the Issue, be credited as fully paid and will rank
pari passu in all respects with the existing Equity Shares including the right to receive all dividends and other
distributions declared, made or paid in respect of the Equity Shares after the date of this Issue.
10
OFFSHORE DERIVATIVE INSTRUMENTS
Subject to compliance with all applicable Indian laws, rules, regulations, guidelines and approvals in terms of
Regulation 21 of the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019 (“SEBI
FPI Regulations”), FPIs, including the affiliates of the Book Running Lead Managers, who are registered as category
I FPI can issue and deal in offshore derivative instruments (as defined under the SEBI FPI Regulations as any
instrument, by whatever name called, which is issued overseas by a FPI against securities held by it in India, as its
underlying) (all such offshore derivative instruments are referred to herein as “P-Notes”) and persons who are eligible
for registration as category I FPIs can subscribe to or deal in such P-Notes provided that in the case of an entity that
has an investment manager who is from the Financial Action Task Force member country, such investment manager
shall not be required to be registered as a Category I FPI. The above-mentioned category I FPIs may receive
compensation from the purchasers of such instruments. Such P-Notes can be issued post compliance with the KYC
norms and such other conditions as specified by SEBI from time to time. P-Notes have not been, and are not being
offered, or sold pursuant to this Placement Document. This Placement Document does not contain any information
concerning P-Notes or the issuer(s) of any P-notes, including, without limitation, any information regarding any risk
factors relating thereto.
Subject to certain relaxations provided under Regulation 22(4) of the SEBI FPI Regulations, investment by a single
FPI including its investor group (multiple entities registered as FPIs and directly or indirectly, having common
ownership of more than 50% or common control) is not permitted to be 10% or above of our post-Issue Equity Share
capital on a fully diluted basis. The SEBI has, vide a circular dated November 5, 2019, issued the operational
guidelines for FPIs, designated depository participants and eligible foreign investors (the “FPI Operational
Guidelines”), to facilitate implementation of the SEBI FPI Regulations. In terms of such FPI Operational Guidelines,
the above mentioned restrictions shall also apply to subscribers of offshore derivative instruments and two or more
subscribers of offshore derivative instruments having common ownership, directly or indirectly, of more than 50% or
common control shall be considered together as a single subscriber of the offshore derivative instruments. Further, in
the event a prospective investor has investments as an FPI and as a subscriber of offshore derivative instruments, these
investment restrictions shall apply on the aggregate of the FPI and offshore derivative instruments investments held
in the underlying company.
Further, in accordance with the FDI Policy, investments where the beneficial owner of the Equity Shares is situated
in or is a citizen of a country which shares land border with India, can only be made through the Government approval
route, as prescribed in the FDI Policy. These investment restrictions shall also apply to subscribers of offshore
derivative instruments.
Any P-Notes that may be issued are not securities of our Company and do not constitute any obligation of,
claims on or interests in our Company. Our Company has not participated in any offer of any P-Notes, or in the
establishment of the terms of any P-Notes, or in the preparation of any disclosure related to any P-Notes. Any P-Notes
that may be offered are issued by, and are the sole obligations of, third parties that are unrelated to our Company. Our
Company and the Book Running Lead Managers do not make any recommendation as to any investment in P-Notes
and do not accept any responsibility whatsoever in connection with any P-Notes. Any P-Notes that may be issued are
not securities of the Book Running Lead Managers and do not constitute any obligations of or claims on the Book
Running Lead Managers. Respective affiliates of the Book Running Lead Managers which are Eligible FPIs may
purchase the Equity Shares in the Issue, and may issue P-Notes in respect thereof, in each case to the extent permitted
by applicable law.
Prospective investors interested in purchasing any P-Notes have the responsibility to obtain adequate
disclosures as to the issuer(s) of such P-Notes and the terms and conditions of any such P-Notes from the
issuer(s) of such P-Notes. Neither SEBI nor any other regulatory authority has reviewed or approved any P-
Notes or any disclosure related thereto. Prospective investors are urged to consult their own financial, legal,
accounting and tax advisors regarding any contemplated investment in P-Notes, including whether P-Notes are
issued in compliance with applicable laws and regulations.
Also see for further information, the section titled “Selling Restrictions” and “Transfer Restrictions” on page 174 and
182, respectively.
11
DISCLAIMER CLAUSE OF THE STOCK EXCHANGES
As required, a copy of the Preliminary Placement Document and this Placement Document has been submitted to each
of the Stock Exchanges. The Stock Exchanges do not in any manner:
(1) warrant, certify or endorse the correctness or completeness of the contents of the Preliminary Placement
Document or this Placement Document;
(2) warrant that the Equity Shares issued pursuant to this Issue will be listed or will continue to be listed on the
Stock Exchanges; or
(3) take any responsibility for the financial or other soundness of our Company, its promoters, its management or
any scheme or project of our Company,
It should not for any reason be deemed or construed to mean that the Preliminary Placement Document or this
Placement Document has been cleared or approved by the Stock Exchanges. Every person who desires to apply for or
otherwise acquire any Equity Shares may do so pursuant to an independent inquiry, investigation and analysis and
shall not have any claim against the Stock Exchanges whatsoever, by reason of any loss which may be suffered by
such person consequent to or in connection with, such subscription/acquisition, whether by reason of anything stated
or omitted to be stated herein, or for any other reason whatsoever.
12
PRESENTATION OF FINANCIAL AND OTHER INFORMATION
Financial Data
The financial year / Fiscal of our Company commences on April 1 of each calendar year and ends on March 31 of the
succeeding calendar year, so, unless otherwise specified or if the context requires otherwise, all references to a
particular “financial year”, “Fiscal year”, “Fiscal” or “FY” are to the twelve-month period ended on March 31 of that
year.
Our Audited Financial Statements and Condensed Interim Unaudited Financial Statements are included in this
Placement Document in “Financial Statements” beginning on page 204.
Our Company publishes its financial statements in Indian Rupees. The following financial statements of our Company
have been disclosed in this Placement Document:
• Audited Financial Statements for the Fiscals ended March 31, 2020, March 31, 2019 and March 31, 2018.
• Condensed Interim Unaudited Financial Statements for the nine month period ended December 31, 2020.
Our Audited Financial Statements as of and for the Fiscals ended March 31, 2020 and March 31, 2019, were prepared
in accordance with Ind AS and the Companies Act, 2013, together with the audit reports issued by Chaturvedi & Co.,
Chartered Accountants for the aforesaid Fiscals are included in this Placement Document.
Our Audited Financial Statements as of and for the Fiscal March 31, 2018, were prepared in accordance with Ind AS
and the Companies Act, 2013, together with the audit report issued by J. Gupta & Co., Chartered Accountants are
included in this Placement Document.
Our Condensed Interim Unaudited Financial Statements have been subjected to limited review by our Statutory
Auditors, who have reported that they applied limited procedures in accordance with professional standards for a
review of such information. However, their separate report included herein states that they did not audit and they do
not express an opinion on that condensed interim unaudited financial information. Accordingly, the degree of such
reliance on their report for such information should be restricted in light of the limited nature of the review procedures
applied therein.
In this Placement Document, certain monetary thresholds have been subjected to rounding off adjustments;
accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures which precede
them.
All financial and statistical information in this Placement Document have been presented in lakhs or in whole numbers
where the numbers have been too small to present in lakhs, unless stated otherwise.
Certain conventions
Unless otherwise specified, all references to “India” in this Placement Document are to the Republic of India, together
with its territories and possessions and all references to the “US”, the “USA”, the “United States” or the “U.S.” are to
the United States of America, together with its territories and possessions.
Unless stated otherwise, all references to page numbers in this Placement Document are to the page numbers of this
Placement Document. References to the singular also refer to the plural and one gender also refers to any other gender,
wherever applicable.
In this Placement Document, unless the context otherwise indicates or implies, references to “you”, “your”, “offeree”,
“purchaser”, “subscriber”, “recipient”, “investors”, “prospective investors” and “potential investor” are to the
prospective investors in the Issue, references to “the Company” or “the Issuer” or “our Company” are to Hindustan
Copper Limited and references to or “we”, “us” or “our” are to the Company and its Subsidiary, unless otherwise
specified.
Currency and units of presentation
13
In this Placement Document, all references to “Indian Rupees”, “INR”, and “Rs.” are to Indian Rupees, the official
currency of the Republic of India. All references to “U.S. dollars”, “USD” and “U.S.$” are to United States dollars,
the official currency of the United States of America. All the numbers in this Placement Document have been presented
in lakhs, as appearing in the section titled “Financial Statements”. One lakh represents 100,000 and one crore
represents 10,000,000. Unless otherwise specified, all financial numbers in parenthesis represent negative figures.
14
FORWARD-LOOKING STATEMENTS
Certain statements contained in this Placement Document that are not statements of historical fact constitute ‘forward-
looking statements’. These statements express views of the management of our Company and expectations based upon
certain assumptions regarding trends in the Indian and international financial markets and regional economies, the
political climate in which our Company operates and other factors. Prospective investors can generally identify
forward looking statements by terminology such as ‘aim’, ‘anticipate’, ‘believe’, ‘continue’, ‘can’, ‘could’, ‘estimate’,
‘expect’, ‘intend’, ‘may’, ‘objective’, ‘plan’, ‘potential’, ‘project’, ‘pursue’, ‘shall’, ‘should’, ‘will’, ‘would’ or other
words or phrases of similar import. Similarly, statements that describe the strategies, objectives, plans or goals of our
Company are also forward-looking statements. However, these are not the exclusive means of identifying forward-
looking statements.
All statements regarding our Company’s expected financial conditions, results of operations, business plans and
prospects are forward-looking statements. These forward-looking statements include statements as to our Company’s
business strategy, planned projects, planned revenue and profitability (including, without limitation, any financial or
operating projections or forecasts), new business and other matters discussed in this Placement Document that are not
historical facts. These forward-looking statements and any other projections contained in this Placement Document
(whether made by our Company or any third party), are predictions and involve known and unknown risks,
uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of our
Company to be materially different from any future results, performance or achievements expressed or implied by
such forward-looking statements or other projections. All forward-looking statements are subject to risks, uncertainties
and assumptions about our Company that could cause actual results to differ materially from those contemplated by
the relevant forward-looking statement. Important factors that could cause the actual results, performances and
achievements of our Company to be materially different from any of the forward-looking statements including,
amongst others:
• The COVID-19 pandemic and resulting deterioration of general economic conditions;
• Outstanding litigation and taxation matters involving our Company and our Director;
• Changes in the copper prices on the London Metal Exchange;
• Significant dependence on copper concentrate for revenue;
• Some of our facilities are currently not operational; and
• Estimates of our mineral reserves.
Additional factors that could cause actual results, performance or achievements of our Company to differ materially
include, but are not limited to, those discussed under the section titled “Risk Factors”, “Industry Overview”, “Our
Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages
40, 108, 124 and 77, respectively. Our Company and the Book Running Lead Managers expressly disclaim any
obligation or undertaking to release publicly any updates or revision to any forward looking statements contained
herein to effect any changes in our Company’s expectations with regard thereto or any changes in events, conditions
or circumstances on which any such statements are based.
By their nature, market risk disclosures are only estimates and could be materially different from what actually occurs
in the future. As a result, actual future gains or losses could materially differ from those that have been estimated,
expressed or implied by such forward looking statements or other projections. The forward-looking statements
contained in this Placement Document are based on the beliefs of management, as well as the assumptions made by,
and information currently available to, the management of our Company. Although our Company believes that the
expectations reflected in such forward-looking statements are reasonable at this time, it cannot assure investors that
such expectations will prove to be correct. Given these uncertainties, investors are cautioned not to place undue
reliance on such forward-looking statements. In any event, these statements speak only as of the date of this Placement
Document or the respective dates indicated in this Placement Document, and neither our Company, nor the Book
Running Lead Managers undertake any obligation to update or revise any of them, whether as a result of new
information, future events, changes in assumptions or changes in factors affecting forward looking statements or
otherwise. If any of these risks and uncertainties materialise, or if any of our Company’s underlying assumptions
15
prove to be incorrect, the actual results of operations or financial condition of our Company could differ materially
from that described herein as anticipated, believed, estimated or expected. All subsequent forward-looking statements
attributable to our Company are expressly qualified in their entirety by reference to these cautionary statements. The
forward-looking statements appear in a number of places throughout this Placement Document and include statements
regarding the intentions, beliefs or current expectations of our Company concerning, amongst other things, the
expected results of operations, financial condition, liquidity, prospects, growth, strategies and dividend policy of our
Company and the industry in which we operate. In addition even if the result of operations, financial conditions,
liquidity and dividend policy of our Company, and the development of the industry in which we operate, are consistent
with the forward-looking statements contained in this Placement Document, those results or developments may not
be indicative of results or developments in subsequent periods.
16
INDUSTRY AND MARKET DATA
Information regarding market position, growth rates and other industry data pertaining to the business of our Company
contained in this Placement Document consists of estimates based on data reports compiled by government bodies,
organisations and analysts, data from other external sources and knowledge of the markets in which our Company
competes. Unless stated otherwise, industry data used throughout this Placement Document has been obtained or
derived from publicly available information as well as industry publications. Industry publications generally state that
the information contained in those publications has been obtained from sources generally believed to be reliable but
that their accuracy, adequacy and completeness are not guaranteed and their reliability cannot be assured. Accordingly,
no investment decision should be made on the basis of such information. Although we believe that the industry data
used in this Placement Document is reliable, it has not been independently verified by the Company, the Book Running
Lead Managers or any of their respective affiliates or advisors.
This data is subject to change and cannot be verified with certainty due to limits on the availability and reliability of
the raw data and other limitations and uncertainties inherent in any statistical survey. Neither our Company nor the
Book Running Lead Managers have independently verified this data, nor do they make any representation regarding
the accuracy of such data. Our Company takes responsibility for accurately reproducing such information but accepts
no further responsibility in respect of such information and data. In many cases, there is no readily available external
information (whether from trade or industry associations, government bodies or other organisations) to validate
market-related analysis and estimates, so our Company has relied on internally developed estimates. Similarly, while
our Company believes its internal estimates to be reasonable, such estimates have not been verified by any independent
sources and neither our Company nor the Book Running Lead Managers can assure potential investors as to their
accuracy.
Further, the extent to which the industry and market data presented in this Placement Document is meaningful depends
on the reader’s familiarity with and understanding of the methodologies used in compiling such data. There are no
standard data gathering methodologies in the industry in which we conduct our business, and methodologies and
assumptions may vary widely among different industry sources.
Such data involves risks, uncertainties and numerous assumptions and is subject to change based on various factors,
including those disclosed in “Risk Factors” on page 40. Accordingly, investment decisions should not be based on
such information.
17
ENFORCEMENT OF CIVIL LIABILITIES
Our Company is a public limited company incorporated under the laws of India. All the Directors and the Key
Managerial Personnel of our Company named herein are residents of India and all of the assets of our Company and
such persons are located in India. As a result, it may be difficult or may not be possible for investors outside India to
effect service of process upon our Company or such persons in India, or to enforce judgments obtained against such
parties outside India.
Recognition and enforcement of foreign judgments is provided for under Section 13 and Section 44A of the Civil
Procedure Code (as defined below), on a statutory basis. Section 13 of the Civil Procedure Code provides that a foreign
judgment shall be conclusive regarding any matter directly adjudicated upon between the same parties or parties
litigating under the same title, except: (i) where the judgment has not been pronounced by a court of competent
jurisdiction; (ii) where the judgment has not been given on the merits of the case; (iii) where it appears on the face of
the proceedings that the judgment is founded on an incorrect view of international law or a refusal to recognise the
law of India in cases in which such law is applicable; (iv) where the proceedings in which the judgment was obtained
were opposed to natural justice; (v) where the judgment has been obtained by fraud; and (vi) where the judgment
sustains a claim founded on a breach of any law then in force in India.
Under Section 14 of the Civil Procedure Code, a court in India shall upon the production of any document purporting
to be a certified copy of a foreign judgement, presume that the judgement was pronounced by a court of competent
jurisdiction, unless the contrary appears on record; but such presumption may be displaced by proving want of
jurisdiction.
India is not a party to any international treaty in relation to the recognition or enforcement of foreign judgments.
However, Section 44A of the Civil Procedure Code provides that a foreign judgment rendered by a superior court
(within the meaning of that section) in any jurisdiction outside India which the Government has by notification
declared to be a reciprocating territory, may be enforced in India by proceedings in execution as if the judgment had
been rendered by a competent court in India. However, Section 44A of the Civil Procedure Code is applicable only to
monetary decrees not being in the nature of any amounts payable in respect of taxes or other charges of a like nature
or in respect of a fine or other penalties and does not include arbitration awards.
Each of the United Kingdom, Singapore and Hong Kong has been declared by the Government to be a reciprocating
territory for the purposes of Section 44A of the Civil Procedure Code, but the United States of America has not been
so declared. A judgment of a court in a jurisdiction which is not a reciprocating territory may be enforced only by a
fresh suit upon the judgment and not by proceedings in execution. The suit must be brought in India within three years
from the date of the foreign judgment in the same manner as any other suit filed to enforce a civil liability in India. It
is unlikely that a court in India would award damages on the same basis as a foreign court if an action is brought in
India. Furthermore, it is unlikely that an Indian court would enforce foreign judgments if it viewed the amount of
damages awarded as excessive or inconsistent with public policy of India. Further, any judgment or award in a foreign
currency would be converted into Rupees on the date of such judgment or award and not on the date of payment. A
party seeking to enforce a foreign judgment in India is required to obtain approval from the RBI to execute such a
judgment or repatriate outside India any amount recovered, and we cannot assure that such approval will be
forthcoming within a reasonable period of time, or at all, or that conditions of such approvals would be acceptable and
any such amount may be subject to income tax in accordance with applicable laws. We cannot assure that Indian
courts and/or authorities would not take a longer amount of time to adjudicate and conclude similar proceedings in
their respective jurisdictions.
18
EXCHANGE RATE INFORMATION
Fluctuations in the exchange rate between the Indian Rupee and foreign currencies will affect the foreign currency
equivalent of the Indian Rupee price of the Equity Shares on the Stock Exchanges. These fluctuations will also affect
the conversion into foreign currencies of any cash dividends paid in Indian Rupees on the Equity Shares.
The following table sets forth information concerning exchange rates between the Indian Rupee and the U.S. dollar
(in Rs. per USD), for or as of the end of the periods indicated. The exchange rates are based on the reference rates
released by RBI / FBIL, which are available on the websites of RBI / FBIL. No representation is made that any Indian
Rupee amounts could have been, or could be, converted into U.S. dollars at any particular rate, the rates stated below,
or at all. No representation is made that the Rupee amounts actually represent such U.S. dollar amounts or could have
been or could be converted into U.S. Dollar at the rates indicated, at any other rate, or at all.
On March 30, 2021, the exchange rate was ₹ 73.04 to USD 1. (Source: www.fbil.org.in)
(₹ per USD)
Period end(1) Average(2) High(3) Low(4)
Fiscal*
2020 75.39 70.88 76.15 68.37
2019 69.17 69.89 74.39 64.93
2018 65.04 64.45 65.76 63.35
Month ended*
February 28, 2021 73.04 72.76 73.04 72.29
January 31, 2021 72.95 73.11 73.45 72.82
December 31, 2020 73.05 73.59 73.89 73.05
November 30, 2020 73.80 74.22 74.69 73.80
October 31, 2020 73.97 73.46 73.97 73.14
September 30, 2020 73.80 73.48 73.92 72.82
(Source: www.rbi.org.in (for period prior to July 9, 2018) and www.fbil.org.in (for period post July 9, 2018))
(1) The price for the period end refers to the price as on the last trading day of the respective fiscal year or monthly
periods.
(2) Average of the official rate for each Working Day of the relevant period.
(3) Maximum of the official rate for each Working Day of the relevant period.
(4) Minimum of the official rate for each Working Day of the relevant period.
The benchmark rates are available with a time lag of for public viewing. Hence, the last available rates as of the date
of this Placement Document are as of March 30, 2021. Accordingly, the rates for the Fiscal and the month are as of
Fiscal 2020 and February 28, 2021.
Notes:
* If the RBI/ FBIL reference rate is not available on a particular date due to a public holiday, exchange rates of the
previous Working Day have been disclosed. The RBI/ FBIL reference rates are rounded off to two decimal places.
19
DEFINITIONS AND ABBREVIATIONS
This Placement Document uses the definitions and abbreviations set forth below, which you should consider when
reading the information contained herein.
The following list of certain capitalised terms used in this Placement Document is intended for the convenience of the
reader/prospective investor only and is not exhaustive.
Unless otherwise specified, the capitalised terms used in this Placement Document shall have the meaning as defined
hereunder. Further any references to any statute or regulations or policies shall include amendments made thereto,
from time to time.
The words and expressions used in this Placement Document but not defined herein, shall have, to the extent
applicable, the meaning ascribed to such terms under the Companies Act, the SEBI ICDR Regulations, the SCRA, the
Depositories Act or the rules and regulations made thereunder, as amended. Notwithstanding the foregoing, terms
used in the sections “Statement of Tax Benefits”, “Industry Overview”, “Financial Statements”, “Risk Factors” and
“Legal Proceedings” beginning on pages 191, 108, 204, 40 and 195, respectively, shall have the meaning given to
such terms in such sections.
In this Placement Document, unless the context otherwise indicates, all references to “HCL”, “the Company”, “our
Company” or “the Issuer” are to Hindustan Copper Limited, a public limited company incorporated under the
Companies Act, 1956, and having its Registered and Corporate Office at Tamra Bhavan, 1, Ashutosh Chowdhury
Avenue, Kolkata – 700 019, West Bengal, India and references to “we”, “us” or “our” are to the Company and its
Subsidiary, unless otherwise specified.
Company Related Terms
Term Description
Articles of Association /
AoA / Articles
The articles of association of our Company, as amended from time to time
Audited Consolidated
Financial Statements
The audited consolidated financial statements of our Company comprising the consolidated
balance sheets as at March 31, 2020 and March 31, 2019, the consolidated statements of profit and
loss (including other comprehensive income) for the Fiscal ended March 31, 2020 and March 31,
2019, the consolidated statements of changes in equity for the Fiscal ended March 31, 2020 and
March 31, 2019 and the consolidated cash flow statements for the Fiscal ended March 31, 2020
and March 31, 2019, read along with the notes thereto including a summary of the significant
accounting policies and other explanatory information prepared in accordance with Ind AS and the
Companies Act together with the report issued thereon by our Statutory Auditor
Audited Financial
Statements
Together, the Audited Consolidated Financial Statements and the Audited Standalone Financial
Statements
Audited Standalone
Financial Statements
The audited standalone financial statements of our Company comprising the standalone balance
sheets as at March 31, 2020, March 31, 2019 and March 31, 2018, the standalone statements of
profit and loss (including other comprehensive income) for the Fiscals ended March 31, 2020,
March 31, 2019 and March 31, 2018, the standalone statements of changes in equity for the Fiscals
ended March 31, 2020, March 31, 2019 and March 31, 2018 and the standalone cash flow
statements for the Fiscals ended March 31, 2020, March 31, 2019 and March 31, 2018 read along
with the notes thereto including a summary of the significant accounting policies and other
explanatory information prepared in accordance with Ind AS and the Companies Act together with
the report issued thereon by our Statutory Auditor for Fiscal 2020 and 2019 and our previous
statutory auditors, J. Gupta & Co., Chartered Accountants, for Fiscal 2018
Auditor/Statutory Auditor The statutory auditor of our Company, namely Chaturvedi & Co., Chartered Accountants.
Board of Directors/Board The board of directors of our Company, including any duly constituted committees thereof
Condensed Interim
Unaudited Consolidated
Financial Statements
The unaudited condensed interim consolidated financial statements of our Company and its
Subsidiary as at and for the nine months period ended December 31, 2020 prepared in accordance
with the Indian Accounting Standards 34 ‘Interim Financial Reporting’ prescribed under Section
133 of the Companies Act read with the IAS Rules, and other relevant provisions of the Companies
Act
Condensed Interim
Unaudited Financial
Statements
Condensed Interim Unaudited Consolidated Financial Statements and Condensed Interim
Unaudited Standalone Financial Statements
20
Term Description
Condensed Interim
Unaudited Standalone
Financial Statements
The unaudited standalone interim consolidated financial statements of our Company and its
Subsidiary as at and for the nine months period ended December 31, 2020 prepared in accordance
with the Indian Accounting Standards 34 ‘Interim Financial Reporting’ prescribed under Section
133 of the Companies Act read with the IAS Rules, and other relevant provisions of the Companies
Act
Director(s) The director(s) on the Board of our Company, as may be appointed from time to time
Equity Shares Equity shares of our Company of face value Rs. 5 each
GCP Gujarat Copper Project
Group Our Company, its Subsidiary and Joint Venture
ICC Indian Copper Complex
Joint Venture / KABIL Khanij Bidesh India Limited
KCC Khetri Copper Complex
Key Management
Personnel
The key management personnel of our Company in accordance with the provisions of the
Companies Act, 2013. For further details, please see section titled “Board of Directors and Senior
Management” beginning on page 146
MCP Malanjkhand Copper Project
Memorandum of
Association/Memorandu
m/MoA
The memorandum of association of our Company, as amended from time to time
Previous Auditor The previous statutory auditor of our Company, namely J. Gupta & Co., Chartered Accountants
Promoter The President of India, acting through the Ministry of Mines, Government of India
Registered and Corporate
Office
Tamra Bhavan, 1, Ashutosh Chowdhury Avenue, Kolkata – 700 019, West Bengal, India
Subsidiary Chhattisgarh Copper Limited
TCP Taloja Copper Plant
Issue Related Terms
Term Description
Allocated/Allocation The allocation of Equity Shares following the determination of the Issue Price to Eligible QIBs on
the basis of the Application Form submitted by them, by our Company in consultation with the
Book Running Lead Managers and in compliance with Chapter VI of the SEBI ICDR Regulations
Allot/Allotment/Allotted Unless the context otherwise requires, the issue and allotment of Equity Shares pursuant to the
Issue
Allottees Successful Bidders to whom Equity Shares Allotted pursuant to the Issue
Application Amount With respect to a Bidder shall mean the aggregate amount paid by such Bidder at the time of
submitting a Bid in the Issue
Application Form The form (including any revisions thereof) pursuant to which a Bidder shall submit a Bid for the
Equity Shares in the Issue
Bid(s) Indication of interest of a Bidder, including all revisions and modifications thereto, as provided in
the Application Form, to subscribe for the Equity Shares to be issued pursuant to the Issue
Bid/Issue Closing Date April 12, 2021, which is the last date up to which the Application Forms was accepted by our
Company (or the Book Running Lead Managers, on behalf of our Company)
Bid/Issue Opening Date April 7,2021, the date on which the acceptance of the Application Forms was commenced by our
Company (or the Book Running Lead Managers on behalf of our Company)
Bidder Any investor, being a QIB, who made a Bid pursuant to the terms of the Preliminary Placement
Document and the Application Form
Bidding Period The period between the Bid/Issue Opening Date and Bid/Issue Closing Date inclusive of both dates
during which Bidders can submit their Bids including any revision and/or modifications thereof
Book Running Lead
Managers
IDBI Capital Markets & Securities Limited and SBI Capital Markets Limited
CAN or Confirmation of
Allocation Note
Note or advice or intimation to successful Bidders confirming Allocation of Equity Shares to such
successful Bidders after determination of the Issue Price and requesting payment for the entire
applicable Issue Price for all Equity Shares Allocated to such successful Bidders
Closing Date The date on which Allotment of Equity Shares pursuant to the Issue shall be made, i.e., on or about
April 13, 2021
Cut-off Price The Issue Price of the Equity Shares to be issued pursuant to the Issue which shall be finalised by
our Company in consultation with the Book Running Lead Managers
Designated Date The date of credit of Equity Shares to the demat accounts of successful Bidders
Eligible FPIs FPIs that are eligible to participate in the Issue other than Category III Foreign Portfolio Investors
Escrow Agreement Agreement dated April 7, 2021, entered into amongst our Company, the Escrow Bank and the
Book Running Lead Managers for collection of the Application Amount and for remitting refunds,
21
Term Description
if any, of the amounts collected, to the Bidders, in relation to the Issue
Escrow Bank / Escrow
Agent
State Bank of India
Escrow Account The account titled “HINDUSTAN COPPER LIMITED QIP ESCROW ACCOUNT” to be opened
with the Escrow Bank, subject to the terms of the Escrow Agreement, into which the application
monies payable by Bidders in connection with subscription to Equity Shares pursuant to the Issue
was deposited.
Floor Price The floor price of Rs. 125.79, which has been calculated in accordance with Chapter VI of the
SEBI ICDR Regulations. In terms of the SEBI ICDR Regulations, the Issue Price cannot be lower
than the Floor Price. Our Company has also decided to offer a discount of Rs. 6.19 on the Floor
Price in terms of Regulation 176 of the SEBI ICDR Regulations
Ind AS Indian accounting standards as notified by the MCA by way of the Companies (Indian Accounting
Standards) Rules, 2015, as amended Issue The issue and Allotment of 4,18,06,020 Equity Shares each at a price of Rs. 119.60 per Equity
Share, including a premium of Rs. 114.60 per Equity Share, aggregating to an amount up to Rs.
50,000 lakhs, pursuant to chapter VI of the SEBI ICDR Regulations and the provisions of the
Companies Act
Issue Price A price per Equity Share of Rs. 119.60
Issue Size The aggregate size of the Issue, aggregating up to Rs. 50,000 lakhs
Mutual Fund A mutual fund registered with SEBI under the Securities and Exchange Board of India (Mutual
Funds) Regulations, 1996, as amended
Mutual Fund Portion 10% of the Equity Shares proposed to be Allotted in the Issue, which is available for Allocation to
Mutual Funds
Pay-in Date The last date specified in the CAN for payment of application monies by the successful Bidders
Placement Agreement Placement agreement dated April 7, 2021 entered into between our Company and the Book
Running Lead Managers
Placement Document This placement document dated April 12, 2021 to be issued in accordance with the provisions of
Chapter VI of the SEBI ICDR Regulations and Section 42 of the Companies Act, 2013 read with
Rule 14 of the Companies (Prospectus and Allotment of Securities) Rules, 2014, as amended
Preliminary Placement
Document
The preliminary placement document dated April 7, 2021 issued to QIBs in accordance with
Chapter VI of the SEBI ICDR Regulations and Section 42 of the Companies Act, 2013 and the
rules prescribed thereunder
Pricing Date April 12, 2021, which is the date of the meeting of the Board deciding to determine the Issue Price
and to ascertain the number of Equity Shares to be issued and Allotted pursuant to the Issue
QIBs or Qualified
Institutional Buyers
Qualified institutional buyers as defined under Regulation 2(1)(ss) of the SEBI ICDR Regulations
QIP Qualified institutions placement, being private placement to Eligible QIBs under Chapter VI of
the SEBI ICDR Regulations and applicable sections of the Companies Act, 2013, read with
applicable rules of the Companies (Prospectus and Allotment of Securities) Rules, 2014
Relevant Date April 7, 2021 which is the date of the meeting of the Board of Directors of the Company or a duly
authorised committee thereof decide to open the Issue
Refund Amount The aggregate amount to be returned to the Bidders who have not been Allocated Equity Shares
for all or part of the Application Amount submitted by such Bidder pursuant to the Issue
Successful Bidders The Bidders who have Bid at or above the Issue Price, duly paid the Application Amount and who
will be Allocated Issue Shares
Business and Industry Related Terms
Term Description
EIA Environmental Impact Assessment
EC Environmental Clearance
LME London Metal Exchange
MTPA Million Tonnes Per Annum
PCB Central and State Pollution Control Board
Rc Refining Charge
Tc Treatment Charge
Conventional and General Terms/Abbreviations
Term Description
AGM Annual general meeting
22
Term Description
AIF(s) Alternative investment funds, as defined and registered with SEBI under the Securities and
Exchange Board of India (Alternative Investment Funds) Regulations, 2012, as amended
AS Accounting Standards
AY Assessment year
BSE BSE Limited
CAGR Compounded annual growth rate
Calendar Year Year ending on December 31 of the relevant year
CCI Competition Commission of India
CDSL Central Depository Services (India) Limited
CEO Chief executive officer
CIN Corporate identity number
Civil Procedure Code /
C. P. C
The Code of Civil Procedure, 1908, as amended
Companies Act The Companies Act, 1956 or the Companies Act, 2013, as applicable
Companies Act, 1956 The erstwhile, Companies Act, 1956 and the rules made thereunder
Companies Act, 2013 The Companies Act, 2013 and the rules made thereunder, each as amended
Competition Act The Competition Act, 2002, as amended
Cr.P.C Code of Criminal Procedure, 1973, as amended
Depositories Act The Depositories Act, 1996, as amended
Depository A depository registered with SEBI under the Securities and Exchange Board of India (Depositories
and Participant) Regulations, 2018, as amended
Depository Participant A depository participant as defined under the Depositories Act
DIN Director identification number
EGM Extraordinary general meeting
Eligible FPIs FPIs that are eligible to participate in this Issue in terms of applicable laws, other than individuals,
corporate bodies and family offices.
Eligible QIBs QIBs, as defined under Regulation 2(1)(ss) of the SEBI ICDR Regulations that are eligible to
participate in the Issue and which are not excluded pursuant to Regulation 179(2)(b) of the SEBI
ICDR Regulations and are not restricted from participating in the Issue under the applicable laws.
In addition, QIBs, outside the United States in “offshore transactions” in reliance on Regulation S
under the Securities Act. Further, FVCIs are not permitted to participate in the Issue.
EPS Earnings per share
FDI Foreign Direct Investment
FDI Policy Consolidated FDI Policy issued by the Department for Promotion of Industry and Internal Trade
(Formerly Department of Industrial Policy and Promotion), Ministry of Commerce and Industry,
GoI by circular DPIIT file number 5(2)/2020-FDI Policy, with effect from October 15, 2020
FEMA Foreign Exchange Management Act, 1999, as amended together with rules and regulations
thereunder
FEMA Non-Debt Rules Foreign Exchange Management (Non-debt Instruments) Rules, 2019, as amended
Financial Year/Fiscal
Year /Fiscal
Period of 12 months ended March 31 of that particular year, unless otherwise stated
Form PAS-4 Form PAS-4 as prescribed under the PAS Rules
FPI Foreign portfolio investors as defined under the SEBI FPI Regulations and includes a person who
has been registered under the SEBI FPI Regulations.
FVCI Foreign venture capital investors as defined under and registered with SEBI pursuant to the
Securities and Exchange Board of India (Foreign Venture Capital Investors) Regulations, 2000
registered with SEBI
GDP Gross Domestic Product
GDR Global Depository Receipts
GoI/Government Government of India
GST Goods and Service Tax
HUF Hindu Undivided Family
ICAI Institute of Chartered Accountants of India
IFRS International Financial Reporting Standards issued by the International Accounting Standards
Board
Insolvency and
Bankruptcy Code/ IBC
The Insolvency and Bankruptcy Code, 2016, as amended
IPC Indian Penal Code, 1860, as amended
IT Act/Income Tax Act Income-tax Act, 1961, as amended
IT Rules Income Tax Rules, 1962, as amended
ITAT Income Tax Appellate Tribunal
23
Term Description
MCA Ministry of Corporate Affairs
Mn Million
NA Not applicable
Non-Resident A person resident outside India, as defined under FEMA and includes Eligible NRIs, FPIs and
FVCIs
Non-Resident
Indian/NRI
A person resident outside India, as defined in the FEMA (Deposit) Regulations, 2000
NSDL National Securities Depository Limited
NSE National Stock Exchange of India Limited
OFAC Office of Foreign Assets Control of the U.S. Treasury Department
p.a Per annum
PAN Permanent account number allotted under the I.T. Act
PAS Rules Companies (Prospectus and Allotment of Securities) Rules, 2014, as amended
PAT Profit after tax
RBI Reserve Bank of India
RBI Act The Reserve Bank of India Act, 1934, as amended
Regulation S Regulation S under the Securities Act, as amended
RoC Registrar of Companies, West Bengal
Rs./Rupees/INR Indian Rupees
SAT Securities Appellate Tribunal
SCRA Securities Contracts (Regulation) Act, 1956, as amended
SCRR Securities Contracts (Regulation) Rules, 1957, as amended
SEBI Securities and Exchange Board of India
SEBI Act The Securities and Exchange Board of India Act, 1992, as amended
SEBI FPI Regulations Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019, as
amended
SEBI ICDR Regulations The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2018, as amended
SEBI Insider Trading
Regulations
Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, as
amended
SEBI Listing Regulations Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015, as amended
SEC United States Securities and Exchange Commission
Securities Act The U.S. Securities Act of 1933, as amended
State Government The government of a state of the Union of India
Stock Exchanges The BSE and the NSE
STT Securities transaction tax
Takeover Regulations Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers)
Regulations, 2011, as amended
U.K. United Kingdom
U.S. GAAP Generally accepted accounting principles in the United States of America
UIN Unique Identification Number
US$ / USD / U.S. dollar United States Dollar, the legal currency of the United States of America
USA/U.S./United States United States of America
VCF Venture capital fund as defined and registered with SEBI under the Securities and Exchange Board
of India (Venture Capital Fund) Regulations, 1996 or the SEBI AIF Regulations, as the case may
be.
24
SUMMARY OF THE ISSUE
The following is a general summary of the terms of the Issue. This summary should be read in conjunction with, and
is qualified in its entirety by, the more detailed information appearing elsewhere in this Placement Document,
including the sections “Risk Factors”, “Use of Proceeds”, “Placement and Lock-Up”, “Issue Procedure” and
“Description of the Equity Shares” on pages 40, 68, 172, 159 and 187 respectively.
Issuer Hindustan Copper Limited
Issue Size The issue of 4,18,06,020 Equity Shares, aggregating to an amount up to Rs.
50,000 lakhs
A minimum of 10% of the Issue Size i.e. 41,80,602 Equity Shares was
made available for Allotment to Mutual Funds only (subject to valid
application), and the balance of 3,76,25,418 Equity Shares was made
available for Allotment to all QIBs, including Mutual Funds. In case of
under subscription or no subscription in the Mutual Fund Portion, such
portion of part thereof may be allocated to other QIBs.
Issue Price Rs. 119.60 per Equity Share (including a premium of Rs. 114.60)
Face Value Rs. 5 per Equity Share
Floor Price Rs. 125.79 per Equity Share, calculated in accordance with Regulation 176
under Chapter VI of the SEBI ICDR Regulations.
Our Company offered a discount of Rs. 6.19 on the Floor Price in terms of
Regulation 176 of the SEBI ICDR Regulations.
Date of Board Resolution
approving the Issue
October 29, 2020
Date of Shareholders’ Resolution
approving the Issue
January 28, 2021
Eligible Investors QIBs as defined in Regulation 2(1)(ss) of the SEBI ICDR Regulations to
whom the Preliminary Placement Document and the Application Formwas
circulated and who are eligible to bid and participate in the Issue and QIBs
not excluded pursuant to Regulation 179(2)(b) of the SEBI ICDR
Regulations.
The list of QIBs to whom the Preliminary Placement Document and
Application Form were delivered was determined by the Company in
consultation with the Book Running Lead Managers.
For further details, please see sections “Issue Procedure”, “Selling
Restrictions” and “Transfer Restrictions” beginning on pages 159, 174 and
182, respectively.
Depositories NSDL and CDSL
Dividend See “Description of Equity Shares”, “Dividends” and “Statement of Tax
Benefits” beginning on pages 187, 76 and 191, respectively.
Indian Taxation Please see section titled “Statement of Tax Benefits” on page 191.
Equity Shares issued and
outstanding immediately prior to
the Issue
92,52,18,000 Equity Shares
Equity Shares issued and
outstanding immediately after the
Issue
Immediately after the Issue, 96,70,24,020 Equity Shares.
Lock-Up Please see “Placement and Lock-Up” on page 172.
25
Listing Our Company has made applications to the BSE and NSE and has obtained
in-principle approvals each dated April 7, 2021 in terms of Regulation
28(1) of the SEBI Listing Regulations, respectively for listing of the Equity
Shares being issued pursuant to this Issue from each of such Stock
Exchanges. Our Company will make applications to each of the Stock
Exchanges to obtain final listing and trading approvals for the Equity
Shares after Allotment of the Equity Shares in the Issue.
Trading The trading of the Equity Shares would be in dematerialized form and only
in the cash segment of each of the Stock Exchanges.
Our Company will make applications to the respective Stock Exchanges to
obtain final listing and trading approvals for the Equity Shares after
Allotment of the Equity Shares in the Issue
Transferability Restrictions The Equity Shares Allotted pursuant to the Issue shall not be sold for a
period of one (1) year from the date of Allotment, except on the floor of
the Stock Exchanges. For further details in relation to other transfer
restrictions, please see section titled “Transfer Restrictions” on page 182.
Use of Proceeds The gross proceeds from the Issue will be approximately Rs. 50,000 lakhs.
After deducting the Issue expenses including fees and commission of
approximately Rs. 457.13 lakhs, the net proceeds of the Issue will be
approximately Rs. 49,542.87 lakhs. For further details, please see section
titled “Use of Proceeds” on page 68 for additional information.
Risk Factors See “Risk Factors” beginning on page 40 for a discussion of risks you
should consider before deciding whether to subscribe for the Equity Shares.
Pay-In Date The last date specified in the CAN for payment of application monies by
the successful Bidders
Closing Date The date on which Allotment of Equity Shares pursuant to the Issue shall
be made, i.e., on or about April 13, 2021
Ranking of Equity Shares The Equity Shares to be issued pursuant to the Issue shall be subject to the
provisions of the Memorandum of Association and Articles of Association
and shall rank pari passu with the existing Equity Shares of our Company,
including rights in respect of dividends. The shareholders of our Company
will be entitled to participate in dividends and other corporate benefits, if
any, declared by our Company after the Closing Date, in compliance with
the Companies Act, 2013, the SEBI Listing Regulations and other
applicable laws and regulations. Shareholders of our Company may attend
and vote in shareholders’ meetings in accordance with the provisions of the
Companies Act, 2013. For details please see section titled “Description of
Equity Shares” on page 187.
Voting Rights See “Description of Equity Shares - Voting Rights” beginning on page 187.
Security Codes for the Equity
Shares
ISIN INE531E01026
BSE Code 513599
NSE Code HINDCOPPER
26
SUMMARY FINANCIAL INFORMATION
The following summary financial information and other data should be read together with “Management’s Discussion
and Analysis of Financial Condition and Results of Operations” and our financial statements, including the notes
thereto and the reports thereon, which appear in “Financial Statements” on page 204. The summary financial
information set forth below is derived from our Audited Financial Statements and Condensed Interim Unaudited
Financial Statements
Selected Profit and Loss Information (on a standalone basis) (Rs. in lakhs, unless stated otherwise)
For the year ended March 31,
2020 2019 2018
INCOME
Revenue from Operations 83,185.25 1,81,625.72 1,70,590.88
Other Income 5,696.22 3,665.87 4,106.56
Total Income 88,881.47 1,85,291.59 1,74,697.44
EXPENSES
Cost of Materials Consumed 628.24 6,493.41 41,138.01
Changes in Inventories of Finished Goods, Semi-Finished and Work-In-
Progress (5,113.58) 14,336.74 (724.65)
Employee Benefits Expense 25,962.31 31,651.48 32,788.84
Finance Costs 6,041.89 5,546.10 2,128.65
Depreciation and Amortization Expenses 28,861.08 25,288.75 16,465.25
General, Administrative & Other Expenses 86,272.96 78,940.47 70,697.80
Total Expenses 1,42,652.90 1,62,256.95 1,62,493.90
Profit / (Loss) Before Exceptional items and Tax (53,771.43) 23,034.64 12,203.54
Exceptional Items - - -
Profit / (Loss) Before Tax (53,771.43) 23,034.64 12,203.54
Tax Expense
Current Tax 842.18 9,128.93 4,639.68
Deferred Tax 2,295.83 (667.91) (419.36)
Profit / (Loss) for the period from continuing operations after Tax (56,909.44) 14,573.62 7,983.22
Profit / (Loss) from discontinued operations (34.70) (34.70) (34.70)
Tax expense of discontinued operations (8.73) (12.13) (12.01)
Profit / (Loss) from discontinued operations after Tax (25.97) (22.57) (22.69)
Profit / (Loss) for the period after Tax (56,935.41) 14,551.05 7,960.53
Other comprehensive Income / (Loss)
Items that will not be reclassified to Profit / (Loss) (3,000.95) (1676.21) 499.52
Income Tax relating to items that will not be reclassified to
Profit / (Loss) 755.28 585.74 -
Total comprehensive income for the period (Comprising Profit /
(Loss) and other Comprehensive Income for the period (59,181.08) 13,460.58 8,460.05
Earnings per equity share of face value of Rs. 5/- each for continuing
operations
Basic and diluted (Rs.) (6.151) 1.575 0.863
Earnings per equity share of face value of Rs. 5/- each for
discontinued operations
Basic and diluted (Rs.) (0.003) (0.002) (0.002)
Earnings per equity share of face value of Rs. 5/- each for continuing
and discontinued operations
Basic and diluted (Rs.) (6.154) 1.573 0.861
27
Selected Balance Sheet Information (on a standalone basis)
(Rs. in lakhs, unless otherwise stated)
As at March 31,
2020 2019 2018
ASSETS
Non Current Assets
Property, Plant and Equipment 29,423.55 31,648.77 33,199.74
Capital Work in Progress 1,23,177.57 1,02,211.31 65,954.68
Financial Assets
Investments 3.15 18.50 -
Other 26.36 12.47 1.44
Deferred Tax Assets (Net) 5,290.81 6,831.36 5,577.71
Non-Current Tax Assets (Net) 689.82 620.33 983.43
Other non- current assets 49,269.28 53,268.78 57,303.93
Current Assets
Inventories 51,982.72 64,336.77 78,861.51
Financial Assets
Investments 9.48 8.85 8.18
Trade Receivables 8,289.35 36,154.83 8,157.36
Cash and Cash Equivalents 1,134.71 658.42 879.67
Bank balances other than above 452.52 424.19 391.54
Others 2,686.41 3,279.93 4,703.55
Current Tax Assets 1,845.39 - -
Other Current Assets 37,524.43 32,108.63 22,725.94
Total Assets 3,11,805.55 3,31,613.14 2,78,748.68
EQUITY AND LIABILITIES
Equity
Equity Share Capital 46,260.90 46,260.90 46,260.90
Other Equity 49,765.59 1,17,436.33 1,06,468.09
Liabilities
Non Current Liabilities
Financial Liabilities
Borrowings 63,617.53 57,065.73 10,208.27
Other financial liabilities 843.53 843.53 923.57
Provisions 6,565.93 5,471.59 8,186.73
Current Liabilities
Financial Liabilities
Borrowings 92,749.96 49,945.20 55,486.81
Trade Payables 23,374.42 20,229.08 22,613.35
Other Financial Liabilities 8,582.21 7,600.37 5,609.32
Other current liabilities 16,982.85 18,880.70 17,150.64
Provisions 3,062.63 6,295.75 5,237.50
Current Tax Liabilities - 1,583.96 603.50
Total Equity and Liabilities 3,11,805.55 3,31,613.14 2,78,748.68
28
Selected Cash Flows Information (on a standalone basis)
(Rs. in lakhs, unless stated otherwise)
For the year ended March 31,
2020 2019 2018
A. Cash flow from operating activities
Net Profit / (Loss) before tax as per statement of profit and loss (53,771.43) 23,034.64 12,203.54
Adjusted for:
Depreciation 3,589.34 3,661.65 3,272.02
Provisions charged 18,884.59 1,899.68 1,022.14
Provisions written back (2,280.83) (1,095.29) (13,76.96)
Interest expense 6,041.89 5,546.10 2,128.65
Dividend paid - - 1,850.43
Dividend tax paid - - 376.70
Amortisation 25271.73 21,627.10 13,193.23
Interest income (1021.90) (334.49) (17,06.74)
Loss / (Profit) on disposal of fixed assets 2.04 (48.24) 1.71
Operating profit before working capital changes (3284.57) 54,291.15 30,964.73
Adjusted for:
Decrease / (Increase) in Trade & other receivables 27,921.74 (28,004.35) 8,348.78
Decrease / (Increase) in Inventories (5,682.60) 14,412.96 3,316.59
Decrease / (Increase) in Current & Non-Current assets (3,808.73) (7,008.79) (10,664.58)
Decrease / (Increase) in Current & Non-Current Liabilities (2,119.57) (2,836.41) 6,376.23
Cash generated from operations 13,026.27 30,854.56 38,341.75
Tax refund received - 1,106.54 3,637.10
Taxes paid (4,423.72) (6,730.75) (4,800.00)
Net cash from operating activities (A) 8,602.55 25,230.35 37,178.85
B. Cash flow from investing activities
Purchase of fixed assets (22,094.87) (40,039.64) (39,748.56)
Sale of fixed assets 12.03 80.07 32.60
Interest received 1,015.68 415.71 2,467.98
Advance for / (Recovery of advance) for Capital expenditure - 260.68 99.27
Investment in Joint Venture / Subsidiary (3.00) (18.50) -
Mine development expenditure (21,913.69) (19,369.43) (18,601.96)
Net cash used in investing activities (B) (42,983.85) (58,671.11) (55,750.67)
C. Cash flow from financing activities
Loan repaid 15,895.21 52,669.68 (5,207.41)
Dividends paid (4,811.14) (2,313.05) (1,850.43)
Dividend tax paid (988.94) (475.45) (376.71)
Interest paid (5,895.91) (5,422.90) (2,170.95)
Net cash used in financing activities (C) 4,199.22 44458.28 (9,605.49)
Net increase in Cash and cash equivalents (A+B+C) (30,182.08) 11,017.52 (28,177.32)
Cash and cash equivalents – opening balance (38,118.57) (49,136.09) (20,958.77)
Cash and cash equivalents – closing balance (68,300.65) (38,118.57) (49,136.09)
29
Selected Profit and Loss Information (on a consolidated basis) (Rs. in lakhs, unless stated otherwise)
For the year
ended March
31, 2020
For the year
ended March
31, 2019
INCOME
Revenue from Operations 83,185.25 1,81,625.72
Other Income 5,696.22 3,665.87
Total Income 88,881.47 1,85,291.59
EXPENSES
Cost of Materials Consumed 628.24 6,493.41
Changes in Inventories of Finished Goods, Semi-Finished and Work-In-Progress (5,113.58) 14,336.74
Employee Benefits Expense 25,962.31 31,651.48
Finance Costs 6,041.89 5,546.10
Depreciation and Amortization Expenses 28,862.06 25,289.40
General, Administrative & Other Expenses 86,257.39 78,964.61
Total Expenses 1,42,638.31 1,62,281.74
Profit / (Loss) Before Exceptional items and Tax (53,756.84) 23,009.85
Exceptional Items - -
Profit / (Loss) Before Tax (53,756.84) 23,009.85
Tax Expense
Current Tax 842.18 9,128.93
Deferred Tax 2,295.83 (667.91)
Profit / (Loss) for the period from continuing operations (56,894.85) 14,548.33
Profit / (Loss) for the period after tax - Attributable to Owners (56,894.85) 14,555.28
Profit / (Loss) for the period after tax - Attributable to Non-Controlling Interest - (6.45)
Profit / (Loss) from discontinued operations (34.70) (34.70)
Tax expense of discontinued operations (8.73) (12.13)
Profit / (Loss) from discontinued operations after Tax (25.97) (22.57)
Profit / (Loss) for the period (56,920.82) 14,526.26
Share of Profit/(Loss) of Joint venture/ Associate (27.64) -
Net profit /(loss) for the period after tax & share of Profit/(loss) of JV / Associate (56,948.46) 14,526.26
Profit / (Loss) for the period after tax - Attributable to Owners (56,948.46) 14,532.71
Profit / (Loss) for the period after tax - Attributable to Non-Controlling Interest - (6.45)
Other comprehensive income
Items that will not be reclassified to Profit / (Loss) (3,000.95) (1,676.21)
Income Tax relating to items that will not be reclassified to
Profit / (Loss) 755.28 585.74
Total comprehensive income for the period (Comprising Profit / (Loss) and other
Comprehensive Income for the period (59,194.13) 13,435.79
Earnings per equity share of face value of Rs. 5/- each for continuing operations
Basic and diluted (Rs.) (6.152) 1.573
Earnings per equity share of face value of Rs. 5/- each for discontinued operations
Basic and diluted (Rs.) (0.003) (0.002)
Earnings per equity share of face value of Rs. 5/- each for continuing and
discontinued operations
Basic and diluted (Rs.) (6.155) 1.571
30
Selected Balance Sheet Information(on a consolidated basis)
(Rs. in lakhs, unless stated otherwise)
As at March 31, 2020 As at March 31, 2019
ASSETS
Non Current Assets
Property, Plant and Equipment 29,427.52 31,653.72
Capital Work in Progress 1,23,177.57 1,02,211.31
Financial Assets
Investments 3.00 -
Other 26.36 12.47
Deferred Tax Assets (Net) 5,290.81 6,831.36
Non-Current Tax Assets (Net) 689.82 620.33
Other Non-current assets 49,269.28 53,268.78
Current Assets
Inventories 51,982.72 64,366.77
Financial Assets
Investments 9.48 8.85
Trade Receivables 8,289.35 36,154.83
Cash and Cash Equivalents 1,134.86 663.53
Bank balances other than above 452.52 424.19
Others 2,686.41 3,279.93
Current Tax Assets (Net) 1,845.39 -
Other Current Assets 37,491.49 32,103.30
Total Assets 3,11,776.58 3,31,599.37
EQUITY AND LIABILITIES
Equity
Equity Share Capital 46,260.90 46,260.90
Other Equity 49,734.19 1,17,417.99
Attributable to Non Controlling Interest
(a) Equity Share Capital 6.50 6.50
(b) Other Equity (6.45) (6.45)
Liabilities
Non - Current Liabilities
Financial Liabilities
Borrowings 63,617.53 57,065.73
Other financial liabilities 843.53 843.53
Provisions 6,565.93 5,471.59
Current Liabilities
Financial Liabilities
Borrowings 92,749.96 49,945.20
Trade Payables 23,374.42 20,299.08
Other Financial Liabilities 8,582.21 7,600.37
Other current liabilities 16,984.81 18,883.94
Provisions 3,063.04 6,297.04
Current Tax Liabilities - 1,583.96
Total Equity and Liabilities 3,11,776.58 3,31,599.37
31
Selected Cash Flows Information (on a consolidated basis)
(Rs. in lakhs, unless stated otherwise)
For the year ended March
31, 2020
For the year ended March
31, 2019
A. Cash flow from operating activities
Net Profit / (Loss) before tax as per statement of profit and loss (53,756.84) 23,009.85
Adjusted for:
Depreciation 3,590.33 3,662.30
Provisions charged 18,866.24 1,900.97
Provisions written back (2,280.83) (1,095.29)
Interest expense 6,041.89 5,546.10
Dividend paid 0.00 0.00
Dividend tax paid 0.00 0.00
Amortisation 25,271.73 21,627.10
Interest income (1,021.90) (334.49)
Dividend income - -
Loss / (Profit) on disposal of fixed assets 2.04 (48.24)
Share of Profit / (Loss) in Joint Venture (27.64) -
Operating profit before working capital changes (3,314.98) 54,268.30
Adjusted for:
Decrease / (Increase) in Trade & other receivables 27,921.74 (28,004.35)
Decrease / (Increase) in Inventories (5,682.60) 14,412.96
Decrease / (Increase) in Current & Non-Current assets (3,781.12) (7,008.79)
Decrease / (Increase) in Current & Non-Current Liabilities (2,121.72) (2,833.18)
Cash generated from operations 13,021.32 30,834.94
Tax refund received - 1,106.54
Taxes paid (4,423.72) (6,730.75)
Net cash from operating activities (A) 8,597.60 25,210.73
B. Cash flow from investing activities
Purchase of fixed assets (22,094.87) (40,039.91)
Sale of fixed assets 12.03 80.07
Interest received 1,015.68 415.71
Advance for / (Recovery of advance) for Capital expenditure - 260.68
Investment in Joint Venture (3.00) -
Mine development expenditure (21,913.69) (19,369.43)
Net cash used in investing activities (B) (42,983.85) (58,652.88)
C. Cash flow from financing activities
Non- Current Borrowings / (Loans repaid) 15,895.20 52,669.68
Dividends paid (4,811.14) (2,313.05)
Dividend tax paid (988.94) (475.45)
Interest paid (5,895.91) (5,422.90)
Increase in other Equity - 6.50
Net cash used in financing activities (C) 4,199.21 44,464.78
Net increase in Cash and cash equivalents (A+B+C) (30,187.04) 11,022.63
Cash and cash equivalents – opening balance (38,113.46) (49,136.09)
Cash and cash equivalents – closing balance (68,300.50) (38,113.46)
32
Selected Profit and Loss Information (on a standalone basis) (Rs. in lakhs, unless stated otherwise)
For the nine month period
ended December 31, 2020
INCOME
Revenue from Operations 1,26,453.05
Other Income 2,553.63
Total Income 1,29,005.68
EXPENSES
Cost of Materials Consumed 161.07
Changes in Inventories of Finished Goods, Semi-Finished and Work-In-Progress 32,517.81
Employee Benefits Expense 19,621.98
Finance Costs 5,103.52
Depreciation and Amortization Expenses 20,178.90
General, Administrative & Other Expenses 36,377.19
Total Expenses 1,13,960.47
Profit / (Loss) Before Exceptional items and Tax 15,045.21
Exceptional Items -
Profit / (Loss) Before Tax 15,045.21
Tax Expense
Current Tax 3,832.00
Deferred Tax (3,484.85)
Profit / (Loss) for the period from continuing operations after Tax 14,698.06
Profit / (Loss) from discontinued operations (26.14)
Tax expense of discontinued operations (6.58)
Profit / (Loss) from discontinued operations after Tax (19.56)
Profit / (Loss) for the period after Tax 14,678.50
Other comprehensive Income / (Loss)
Items that will not be reclassified to Profit / (Loss) (1,500.00)
Income Tax relating to items that will not be reclassified to
Profit / (Loss) 377.52
Total comprehensive income for the period (Comprising Profit / (Loss) and other
Comprehensive Income for the period 13,556.02
Earnings per equity share of face value of Rs. 5/- each for continuing operations
Basic and diluted (Rs.) 1.589
Earnings per equity share of face value of Rs. 5/- each for discontinued operations
Basic and diluted (Rs.) (0.002)
Earnings per equity share of face value of Rs. 5/- each for continuing and discontinued
operations
Basic and diluted (Rs.) 1.587
33
Selected Balance Sheet Information (on a standalone basis)
(Rs. in lakhs, unless otherwise stated)
As at December 31, 2020
ASSETS
Non Current Assets
Property, Plant and Equipment 38,743.75
Capital Work in Progress 1,23,814.15
Financial Assets
Investments 58.55
Other 470.57
Deferred Tax Assets (Net) 9,153.18
Non-Current Tax Assets (Net) 689.82
Other non- current assets 45,221.51
Current Assets
Inventories 19,671.97
Financial Assets
Investments 9.87
Trade Receivables 13,118.69
Cash and Cash Equivalents 2,638.29
Bank balances other than above 15.56
Others 5,215.12
Current Tax Assets 1,866.62
Other Current Assets 40,298.39
Total Assets 3,00,986.04
EQUITY AND LIABILITIES
Equity
Equity Share Capital 46,260.90
Other Equity 64,958.69
Liabilities
Non Current Liabilities
Financial Liabilities
Borrowings 84,731.11
Other financial liabilities 843.53
Provisions 8,215.93
Current Liabilities
Financial Liabilities
Borrowings 42,310.73
Trade Payables 16,281.20
Other Financial Liabilities 9,068.11
Other current liabilities 21,087.72
Provisions 3,396.12
Current Tax Liabilities 3,832.00
Total Equity and Liabilities 3,00,986.04
34
Selected Cash Flows Information (on a standalone basis)
(Rs. in lakhs, unless stated otherwise)
For the nine month period
ended December 31, 2020
A. Cash flow from operating activities
Net Profit / (Loss) before tax as per statement of profit and loss 15,045.21
Adjusted for:
Depreciation 3,105.23
Provisions charged 591.37
Provisions written back (981.69)
Interest expense 5,103.52
Dividend paid -
Dividend tax paid -
Amortisation 17,073.67
Interest income (25.95)
Loss / (Profit) on disposal of fixed assets -
Operating profit before working capital changes 39,911.36
Adjusted for:
Decrease / (Increase) in Trade & other receivables (5,893.42)
Decrease / (Increase) in Inventories 32,310.75
Decrease / (Increase) in Current & Non-Current assets (5,206.07)
Decrease / (Increase) in Current & Non-Current Liabilities (545.66)
Cash generated from operations 60,576.96
Tax refund received -
Taxes paid -
Net cash from operating activities (A) 60,576.96
B. Cash flow from investing activities
Purchase of fixed assets (13,275.51)
Sale of fixed assets -
Interest received 27.38
Advance for / (Recovery of advance) for Capital expenditure -
Investment in Joint Venture / Subsidiary (55.40)
Mine development expenditure (12,926.38)
Net cash used in investing activities (B) (26,229.91)
C. Cash flow from financing activities
Loan repaid 23,664.35
Dividends paid -
Dividend tax paid -
Interest paid (5,142.5)
Net cash used in financing activities (C) 18,521.85
Net increase in Cash and cash equivalents (A+B+C) 52,868.90
Cash and cash equivalents – opening balance (68,300.65)
Cash and cash equivalents – closing balance (15,431.75)
35
Selected Profit and Loss Information (on a consolidated basis) (Rs. in lakhs, unless stated otherwise)
For the nine month period
ended December 31, 2020
INCOME
Revenue from Operations 1,26,452.05
Other Income 2,553.63
Total Income 1,29,005.68
EXPENSES
Cost of Materials Consumed 161.07
Changes in Inventories of Finished Goods, Semi-Finished and Work-In-Progress 32,517.81
Employee Benefits Expense 19,621.98
Finance Costs 5,103.52
Depreciation and Amortization Expenses 20,179.63
General, Administrative & Other Expenses 36,355.38
Total Expenses 1,13,939.39
Profit / (Loss) Before Exceptional items and Tax 15,066.29
Exceptional Items -
Profit / (Loss) Before Tax 15,066.29
Tax Expense
Current Tax 3,832.00
Deferred Tax (3,484.85)
Profit / (Loss) for the period from continuing operations after Tax 14,719.14
Profit / (Loss) for the period After Tax- Attributable to owners 14,722.80
Profit / (Loss) for the period After Tax- Attributable to Non-Controlling interest (3.66)
Profit / (Loss) from discontinued operations (26.14)
Tax expense of discontinued operations (6.58)
Profit / (Loss) from discontinued operations after Tax (19.56)
Profit / (Loss) for the period after Tax 14,699.58
Share of Profit/Loss of Joint venture Associate Net Profit /Loss for the period after tax 14,699.58
Profit / (Loss) for the period after Tax- Attributable to owners 14,703.24
Profit / (Loss) for the period after Tax- Attributable to Non Controlling Interest (3.66)
Other comprehensive Income / (Loss)
Items that will not be reclassified to Profit / (Loss) (1,500.00)
Income Tax relating to items that will not be reclassified to
Profit / (Loss)
377.52
Total comprehensive income for the period (Comprising Profit / (Loss) and other
Comprehensive Income for the period 13,577.10
Earnings per equity share of face value of Rs. 5/- each for continuing operations
Basic and diluted (Rs.) 1.591
Earnings per equity share of face value of Rs. 5/- each for discontinued operations
Basic and diluted (Rs.) (0.002)
Earnings per equity share of face value of Rs. 5/- each for continuing and discontinued
operations
Basic and diluted (Rs.) 1.589
36
Selected Balance Sheet Information (on a consolidated basis)
(Rs. in lakhs, unless otherwise stated)
As at December 31, 2020
ASSETS
Non Current Assets
Property, Plant and Equipment 38,746.88
Capital Work in Progress 1,23,814.15
Financial Assets
Investments 47.36
Other 470.57
Deferred Tax Assets (Net) 9,153.18
Non-Current Tax Assets (Net) 689.82
Other non- current assets 45,221.51
Current Assets
Inventories 19,671.97
Financial Assets
Investments 9.87
Trade Receivables 13,118.69
Cash and Cash Equivalents 2,641.38
Bank balances other than above 15.56
Others 5,215.12
Current Tax Assets 1,866.62
Other Current Assets 40,301.14
Total Assets 3,00,983.82
EQUITY AND LIABILITIES
Equity
Equity Share Capital 46,260.90
Other Equity 64,952.03
Attributable to Non Controlling Interest
a) Equity Share Capital 11.70
b) Other Equity (10.11)
Liabilities
Non Current Liabilities
Financial Liabilities
Borrowings 84,731.11
Other financial liabilities 843.53
Provisions 8,215.93
Current Liabilities
Financial Liabilities
Borrowings 42,310.73
Trade Payables 16,281.20
Other Financial Liabilities 9,068.11
Other current liabilities 21,090.57
Provisions 3,396.12
Current Tax Liabilities 3,832.00
Total Equity and Liabilities 3,00,983.82
37
Selected Cash Flows Information (on a consolidated basis)
(Rs. in lakhs, unless stated otherwise)
For the nine month period
Ended December 31, 2020
A. Cash flow from operating activities
Net Profit / (Loss) before tax as per statement of profit and loss 15,066.29
Adjusted for:
Depreciation 3,105.96
Provisions charged 559.97
Provisions written back (981.69)
Interest expense 5,103.52
Dividend paid -
Dividend tax paid -
Amortisation 17,073.67
Interest income (25.95)
Loss / (Profit) on disposal of fixed assets -
Operating profit before working capital changes 39,901.77
Adjusted for:
Decrease / (Increase) in Trade & other receivables (5,893.42)
Decrease / (Increase) in Inventories 32,310.75
Decrease / (Increase) in Current & Non-Current assets (5,208.01)
Decrease / (Increase) in Current & Non-Current Liabilities (551.68)
Cash generated from operations 60,559.41
Tax refund received -
Taxes paid -
Net cash from operating activities (A) 60,559.41
B. Cash flow from investing activities
Purchase of fixed assets (13,271.37)
Sale of fixed assets 0.11
Interest received 27.38
Advance for / (Recovery of advance) for Capital expenditure -
Investment in Joint Venture / Subsidiary (44.36)
Mine development expenditure (12,926.38)
Net cash used in investing activities (B) (26,214.62)
C. Cash flow from financing activities
Loan repaid 23,664.35
Dividends paid 0.00
Dividend tax paid 0.00
Interest paid (5,142.5)
Increase in Other Equity 5.20
Net cash used in financing activities (C) 18,527.05
Net increase in Cash and cash equivalents (A+B+C) 52,871.84
Cash and cash equivalents – opening balance (68,300.50)
Cash and cash equivalents – closing balance (15,428.66)
38
RELATED PARTY TRANSACTIONS
For details of the related party transactions during the nine months ended December 31, 2020 and Fiscals 2020, 2019
and 2018, as per the requirements under Ind AS 24 “Related Party Disclosures” as notified under Section 133 of the
Companies Act, read with the Ind AS Rules, as amended, see “Financial Statements” beginning on page 204.
39
SUMMARY OF BUSINESS
Overview
We are the only operating copper ore producing mining company in India. We are also the only vertically integrated
producer of refined copper in India (Source: Annual Report (2019-20), Ministry of Mines, Government of India). We
have access to around two-fifths of India’s copper ore reserves and resources as on April 1, 2020. Our Company is
central public sector undertaking under the Ministry of Mines, Government of India. Our Company was conferred
Miniratna- Category I status by the Government of India in 2008.
Our principal activities include: (a) mining of copper ore; (b) beneficiation of copper ore into copper concentrate; and
(c) smelting, refining and extruding of the refined copper in downstream saleable products. We sell copper concentrate,
copper cathode and continuous cast wire rods. In addition, we sell by-products generated through the copper
manufacturing process including anode slime containing gold and silver and sulphuric acid.
Our principal operations include three copper ore mining complexes – the Malanjkhand Copper Project (“MCP”) at
Malanjkhand in Balaghat district, Madhya Pradesh, the Khetri Copper Complex (“KCC”) at Khetrinagar in Jhunjhunu
district, Rajasthan and the Indian Copper Complex (“ICC”) at Ghatsila in East Singhbhum district, Jharkhand – each
of which consists of one or more copper ore mines and their own beneficiation plants. Further, our ICC complex also
has its own smelting and refining facilities with a production capacity of cathode of 18,500 MT/annum. Additionally,
we have a continuous cast copper wire rod plant at Taloja in Raigad district, Maharashtra with a production capacity
of 60,000 MT/annum. We also have a secondary smelter and refinery plant at our Gujarat Copper Project (“GCP”) at
Jhagadia in Bharuch district, Gujarat with a production capacity of 50,000 MT/annum.
As on April 1, 2020, we had access to around two-fifths of the copper ore reserves and resources in India with an
average grade 1.01%. Further, as on April 1, 2020, we had reserves (proved & probable) of 167.08 million tonne ore
(average grade 1.32%) and total reserves and resource of 570.40 million tonne ore (average grade 1.01%).
40
RISK FACTORS
An investment in Equity Shares involves a high degree of risk. You should carefully consider each of the following risk
factors and all other information set forth in this Placement Document, including the risks and uncertainties
described below, before making an investment in the Equity Shares. You should read this section together with
“Industry Overview”, “Business”, “Summary Financial Information”, and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” as well as the Financial Statements, including the notes thereto,
and other financial information included elsewhere in this Placement Document. You should consult your tax,
financial and legal advisors about the particular consequences to you of an investment in the Equity Shares.
The risks and uncertainties described below are not the only risks that we currently face. Additional risks and
uncertainties not presently known to us or that we currently believe to be immaterial may also materially and
adversely affect our business, prospects, financial condition and results of operations and cash flows. If any or some
combination of the following risks, or other risks that we do not currently know about or believe to be material,
actually occur, our business, financial condition and results of operations and cash flows could suffer, the trading
price of, and the value of your investment in, our Equity Shares could decline, and you may lose all or part of your
investment. In making an investment decision, you must rely on your own examination of the Company and the terms
of this Issue, including the merits and risks involved.
This Placement Document also contains forward-looking statements that involve risks and uncertainties. Our results
could differ materially from such forward-looking statements as a result of certain factors, including the considerations
described below and elsewhere in this Placement Document.
A. Risk Factors Relating to Our Business
1. The COVID-19 pandemic and resulting deterioration of general economic conditions has impacted our
business and results of operations in the past and the extent to which it will impact our future business and
results of operations will depend on future developments, which are difficult to predict.
Since first being reported in December 2019, the outbreak of COVID-19 has spread globally. The World Health
Organization declared the novel coronavirus disease (“COVID-19”) outbreak a Public Health Emergency of
International Concern on January 30, 2020, and a pandemic on March 11, 2020. The rapid and diffused spread of
COVID-19 and global health concerns relating to this pandemic have had a severe negative impact on, among other
things, financial markets, liquidity, economic conditions and trade and could continue to do so or could worsen for an
unknown period of time, that could in turn have a material adverse impact on our business, cash flows, results of
operations and financial condition, including liquidity and growth. The extent to which the COVID-19 outbreak
impacts our business, cash flows, results of operations and financial condition will depend on future developments,
including on the duration and severity of the pandemic, the nature and scope of government actions to contain it, and
the potential impact on global and national economic conditions, including inflation, interest rates, availability of
capital markets, consumer spending rates, energy availability and costs (including fuel surcharges), which are highly
uncertain and cannot be predicted. A rapid increase in severe cases and deaths where measures taken by governments
fail or are lifted prematurely, may cause unprecedented economic disruption in India and in the rest of the world. The
scope, duration and frequency of such measures and the adverse effects of COVID-19 remain uncertain and are likely
to be severe. In addition, while the Government of India in coordination with the state governments have started the
bulk immunization process or vaccination drive since January 16, 2021, such vaccination drive is currently focused
on healthcare and front-line workers and achieving a complete vaccination scale may take significant amount of time.
There is also no assurance that the vaccines that are developed will be fully effective and/ or may not have side effects.
On March 14, 2020, India declared COVID-19 as a ‘notified disaster’ and imposed a nationwide lockdown announced
on March 24, 2020. Subsequently, progressive relaxations have been granted for movement of goods and people and
cautious re-opening of businesses and offices. We have resumed our operations in a phased manner due to certain
specific directions/ guidelines issued by the State Government. Further, our facilities are currently operating subject
to certain social distancing and additional safety measures, such as, regular temperature checks, regular sanitization,
and compulsory use of masks and hand sanitization. The COVID-19 pandemic resulted in some disruptions in the
supply of raw materials from our suppliers during the months of March, April and May 2020. We also experienced
some disruptions in supply chain and inventory management, as well as delays in orders. We continue to closely
monitor the impact that COVID-19 may have on our business and results of operations. Adverse effects of the COVID-
19 pandemic may also significantly increase the effect of the aforementioned factors affecting our results of operations.
41
The COVID-19 pandemic and related volatility in financial markets and deterioration of national and global economic
conditions could affect our business and operations in a variety of ways. For instance, on account of operating
restrictions/ lockdown consequent to the outbreak of the COVID-19 pandemic, we may experience operational
disruptions as a result of the following:
• a temporary shutdown of our facilities due to government restrictions or illness in connection with COVID-
19;
• a decrease in demand for our products as a result of COVID-19 on account of government restrictions
imposed and additionally on account of cost control measures implemented by our customers;
• supply chain disruptions for us and our customers;
• a significant percentage of our workforce being unable to work, including because of travel or government
restrictions in connection with COVID-19, including stay at home orders;
• delays in orders or delivery of orders;
• our strategic projects getting postponed or our planned deliveries being delayed; and
• inability to collect full or partial payments from some customers due to deterioration in customer liquidity.
The extent to which the COVID-19 impacts our business and results will depend on future developments, which are
highly uncertain and cannot be predicted, such as new information which may emerge concerning the severity of the
coronavirus and the actions taken globally to contain the coronavirus or treat its impact, among others. In addition,
we cannot predict the impact that the COVID-19 pandemic will have on our customers, suppliers and other business
partners, and each of their financial conditions; however, any material effect on these parties could adversely impact
us. As a result of these uncertainties, the impact may vary significantly from that estimated by our management from
time to time, and any action to contain or mitigate such impact, whether government-mandated or opted by us, may
not have the anticipated effect or may fail to achieve its intended purpose altogether. Existing insurance coverage may
not provide protection for all costs that may arise from all such possible events.
As of the date of this Placement Document, there is significant uncertainty relating to the severity of long-term adverse
impact of the COVID-19 pandemic on the global economy, global financial markets and the Indian economy, and we
are unable to accurately predict the long-term impact of the COVID-19 pandemic on our business. To the extent that
the COVID-19 pandemic adversely affects our business and operations, it may also have the effect of heightening
many of the other risks described in this “Risk Factors” section.
2. There are outstanding litigation and taxation matters involving our Company and our Directors, which if
determined adversely, could affect our business and results of operations.
We and our Directors are involved in certain legal proceedings and tax matters. These legal proceedings are pending
at different levels of adjudication before various courts and tribunals. The amounts claimed in these proceedings have
been disclosed to the extent ascertainable and include amounts claimed jointly and severally from us and other parties.
We can give no assurance that these legal proceedings will be decided in our favour. We may incur significant
expenses and management time in such legal proceedings and may have to make provisions in our financial statements,
which could increase our expenses and liabilities. Any adverse decision may have an adverse effect on our business,
results of operations and financial condition. If any new developments arise (e.g., rulings against us by the appellate
courts or tribunals), we may face losses and may have to make provisions in our financial statements, which could
increase our expenses and liabilities. Any adverse outcome of litigation or regulatory proceedings could have a
material adverse effect on our business, future financial performance and trading price of the Equity Shares. Our
Company may also incur legal cost for a matter even if our Company has not made any legal provisions for the same.
In addition, the cost of resolving a legal claim may be substantially higher than any amount reserved for
For further details on the outstanding litigation against our Company and Directors please see section titled “Legal
Proceedings” on page 195.
3. Changes in the copper prices on the London Metal Exchange (“LME”) could adversely affect our results
of operations and thus affect our financial condition.
Presently, the majority of our sales of copper are made to customers in the domestic market in India. For the Fiscal
ended March 31, 2020, we generated approximately 57.43% of our revenue from operations from sales through exports
and 42.57% from sales in the domestic market. Refined copper products prices are benchmarked to the LME copper
price. The price of copper concentrate is negotiated between buyers (i.e. refined copper producers) and sellers (i.e.
42
mining companies) by working backwards, subtracting treatment and refining charge (“TcRc”) from the LME copper
price. Copper concentrate undergoes the smelting and refining processes to produce refined copper products in the
form of copper cathodes. Treatment charge (“Tc”) reflects the charge for the smelting process and refining charge
(“Rc”) reflects the charge for the refining of metals. In practice, the TcRc charges are determined by the oversupply
or deficit of copper concentrates in the market and not by the real cost for carrying out these processes. If there is an
oversupply of copper concentrates in the market as compared with global smelting capacity, smelters will demand
higher TcRc charges, and vice versa. In both cases, the real cost of smelting and refining remains unchanged.
LME copper prices have been volatile in the past. Sharp declines in the LME copper price in the past had caused us
to partially suspend mining, smelting and refining operations in the past and were largely responsible for us undergoing
government restructuring in the past years. The average spot LME copper price in Fiscal 2020 was approximately
US$ 5859.54 per tonne and in Fiscal 2019 was approximately US$ 6340.62 per tonne. While the LME copper price
as on December 31, 2020 was US$ 7,741.50 per tonne, LME copper prices have fluctuated significantly in the past
and they may continue to fluctuate in the future and there is no assurance that the LME price of copper will continue
to increase in the future. Accordingly, any significant decline of LME copper price in the future will adversely affect
the prices of our refined copper products and indirectly adversely affect the prices of our copper concentrate, which
will negatively impact our business, financial condition and results of operations.
4. We are significantly dependent on copper concentrate for revenue. Our copper ore mining operation is
dependent upon the ore produced at our Indian Copper Complex, Khetri Copper Complex and Malanjkhand
Copper Project. Any interruption in the operations at these mining complexes could have a material adverse
effect on our results of operations and financial condition.
Our revenue is significantly dependent on the production of metal in concentrate from our mines at ICC, KCC and
MCP. In Fiscal 2020, we produced 26,502 tonnes of metal in concentrate contain in copper concentrate from our
copper ore mining operations at our ICC, KCC and MCP mining complexes. Out of these 26,502 tonnes of metal in
concentrate, approximately 7.79%, 32.95% and 59.26% were produced from our ICC, KCC and MCP complexes,
respectively.
Further, in Fiscal 2020, our metal in concentrate production was affected due to low grade of ore at MCP and KCC as
well as water shortage at KCC. In addition, the availability of material was less in the open cast mine at MCP which
has reached its ultimate depth and is in a transition phase from open cast to underground mining. While we are in the
process of expanding our mining capacity and intend to sell copper concentrate as our primary product, our results of
operations have been and are expected to continue to be substantially dependent on the reserves of the mines at these
three mining complexes, and any interruption in the operations at these mines for any reason could have a material
adverse effect on our results of operations and financial condition.
5. Some of our facilities are currently not operational. We cannot guarantee that we will in the future be able to
operate these facilities at their optimum capacity or at all which could have a material adverse effect on our
results of operations and financial conditions.
GCP has three sections namely, Anode furnace (Smelter), Refinery and Kaldo Furnace having aggregate book value
of Rs. 27,559.37 lakh as at December 31, 2020. The Anode Furnace and Refinery unit has been commissioned in
October 2016 while Kaldo unit is commissioned on May 25, 2020. Since commissioning, the plant is being operated
at a sub optimal level for want of feed stock. GCP being a secondary smelter, the feed stock are copper scrap, copper
blister, liberator cathode, etc. We have not been able to operate profitably the plant due to various constraints and our
Auditor has drawn attention to the valuation of GCP of Rs. 24,536.34 lakhs (PY:- Rs. 27,214.50 lakhs) as at March
31, 2020 and has stated that a viability assessment needs to be done to evaluate and adjust for possible impairment
loss, if any. Further, the Company has not been operating the smelting and refining facility at GCP for want of feed
material at economical price since July 2019. Accordingly, we have floated an ‘Expression of Interest for Long Term
Leasing or Outright Sale of the Gujarat Copper Project located at Bharuch’ and have received bids against the
expression of interest and we plan to float tender for long term leasing or outright sale of GCP.
Our Company has also suspended the operation of the smelting and refinery plant at ICC since December 2019 due
to the market conditions and business model followed by the company. In addition, we are utilising TCP facility only
for the purpose of tolling third party cathode since January 2020.
43
Further, the copper ore tailing (“COT”) beneficiation plant which was set up at MCP unit for extraction of valuable
minerals and metals from copper ore tails has not been commissioned and the contract has been terminated as of date.
Copper ore tailing (COT) beneficiation plant was set up at MCP unit for extraction of valuable minerals and metals
from copper ore tails with a capacity of 10,000 tonnes per day (TPD) at an estimated cost of Rs. 20,000 lakh. The
intermittent trial run failed on number of occasions (chockage/ spillage, stoppages, cleaning etc) and the quality and
quantity of products achieved at various stages are not as per the parameters envisaged in contract agreement. A
preliminary notice was issued to the party to complete the project and commission the same. The party agreed to
commission the plant, but the progress of the work at site was stopped due to lockdown for COVID-19 pandemic. The
Company had extended the timeline upto August 31, 2020 for supply, erection of the thickener and commission of the
plant. But the party failed to execute the contract and the contract got terminated with efflux of time and the Company
has forfeited the security deposit under the contract. Further, we may be required to conduct a viability assessment to
evaluate and adjust for possible impairment loss, if any.
We cannot guarantee that we will in the future be able to operate the abovementioned facilities, at their full capacity
or at all. Accordingly, these could have a material adverse effect on our results of operations and financial conditions.
6. Our statements of mineral reserves are subject to estimations, and if the actual amounts of such reserves are
less than estimated, our results of operations and financial condition may be adversely affected.
Our future performance depends on, among other things, the accuracy of the estimates of our ore reserves and
resources. Our mineral resources and ore reserves have been historically estimated by us using the Geological Survey
of India (“GSI”) system. Since 2005, the United Nations Framework Classification (the “UNFC”) has been introduced
and most of the reserves have been adequately converted to the UNFC system under our own internal reports. The
ore reserves and resources set forth in this Placement Document are also based on management estimates and third
party sources.
The estimates of reserves may differ in certain significant respects under JORC and UNFC guidelines. We cannot
assure you that one set of guidelines will produce more accurate reserve numbers than the other. The UNFC guidelines
provide for many more categories of recoverable minerals than the JORC guidelines. In particular, UNFC includes
Feasibility Mineral Resources, Pre-Feasibility Mineral Resources and Reconnaissance Mineral Resources. In addition,
while JORC is a two dimensional system, taking into account geological and economic considerations, UNFC has a
third dimension, reflecting the degree of assurance of resource/reserve estimates with respect to economic viability.
In connection with either set of guidelines, there are numerous uncertainties inherent in estimating quantities and
grades of reserves and in projecting potential future rates of mineral production, including many factors beyond our
control. Reserve estimation is a subjective process of estimating deposits of minerals that cannot be measured in an
exact manner, and the accuracy of any reserve estimate is a function of the quality of available data and engineering
and geological interpretation and judgment. Estimates of different engineers may vary, and results of our mining and
production subsequent to the date of an estimate may lead to revision of estimates. Reserve estimates and estimates
of mine life may require revision based on actual production experience and other factors. For example, fluctuations
in the market price of ore, reduced recovery rates or increased production costs due to inflation or other factors may
render proven and probable reserves containing relatively lower grades of mineralization uneconomic to exploit and
may ultimately result in a restatement of reserves. If our reserve estimates differ materially from mineral quantities or
grades that we may actually recover, estimates of mine life may prove inaccurate and market price fluctuations and
changes in operating and capital costs may render certain ore reserves or mineral deposits uneconomical to mine. If
this occurs, our results of operations and financial condition may be adversely affected.
As a result, you should not place undue reliance on the ore reserve data contained in this Placement Document. In the
event that any of these estimations turns out to be incorrect, we may need to revise our ore reserves downwards and
this may adversely affect our life of mine plans and consequently the total value of our mining asset base, which could
increase our costs and decrease profitability.
For more information on our ore reserve and resources, see “Our Business – Access to substantial reserves” on page
127.
7. We depend and will continue to depend on obtaining and maintaining mining leases to mining sites and a
number of regulatory clearances and approvals, some of which are in the process of extension. If such leases
44
are not extended or such approvals are not granted, our results of operations and financial condition, as well
as our mining prospects and future growth, may be adversely affected.
Our exploration and mining activities depend on the grant, extension or continuance in force of various exploration
and production contracts, licences, permits and other regulatory approvals that are only valid for a finite period of time
and may provide for early termination. In India, the government grants exploration and production rights through
mining leases, mining licences, contracts, permits and other regulatory approvals. These rights are not granted in
perpetuity. For example, our mining right for the Surda mine expired on March 31, 2020. Further, our mining lease
for the Rakha mine is due to expire on August 28, 2021 and the mining lease for our Malanjkhand mine is due to
expire on August 27, 2023. There can be no assurance that the relevant State Government will extend our leases under
the same or favourable terms in the future. Further, the Government of Jharkhand had asked the Company to pay
additional royalty payment without which they may not extend the lease of Surda mine. If any of the leases that have
expired are not extended by the GoI or the relevant State Government, or if the appropriate approvals and clearances
for mining are not obtained and maintained, our results of operations and financial condition, as well as mining
prospects and future growth could be adversely affected. For the complete details of the present status of our mining
leases, please see “Our Business- Our Mines” on page 133.
Moreover, entering into new licence or mining lease contracts or extending existing licence or mining lease contracts
in India is time consuming and requires the review and approval of several Indian government authorities. Private
individuals and the public at large possess rights to comment on and otherwise engage in the licensing process,
including through intervention in courts and political pressure. The relevant laws and regulations are often unclear
and may not be consistently applied. Our licences or mining lease contracts contain various obligations and
restrictions, including restrictions on constructing buildings or conducting mining operations at certain areas and the
requirement of seeking a prior Government approval for an assignment or any other form of transfer of the lease or
for the employment of a person who is not an Indian national. If we breach these obligations, we may suffer adverse
consequences, such as penalties and/or suspension or termination of our licence or mining lease contracts. In addition,
changing circumstances may require us to amend these licence or mining lease contracts. There can be no assurance,
however, that the relevant Indian regulatory authorities will agree to future amendments of our obligations. The loss
of our licence or mining lease contracts would have a material adverse effect on our business, financial condition,
results of operations and profits.
In addition, our ability to mine new areas of land on which we are seeking mining rights, pursuant to leases, is
dependent on our acquisition of surface rights separately and subsequently to the grant of mining leases and generally
over only part of the land leased. Additional surface rights may be negotiated separately with landowners, though
there is no guarantee that these rights will be granted. The title deeds for Freehold and Leasehold Land and Building
acquired in respect of GCP with book value of Rs. 5,578.11 lakhs as at March 31, 2020 are yet to be executed. Further,
the title deeds, conveyance deeds, etc. in respect of certain freehold lands at ICC acquired through nationalization in
accordance with Indian Copper Corporation (Acquisition of Undertaking) Act, 1972 are not in possession of the
Company. Substantial compensation costs may be incurred by us in obtaining surface rights. Any delay or substantial
compensation costs in obtaining, or any inability to obtain, surface rights at reasonable costs could negatively affect
our financial condition and results of operations. There can be no assurance that we will be able to retain such leasehold
rights or surface rights on acceptable terms, or, if obtained, such rights may not be obtained in a timely manner or may
involve requirements which restrict our ability to conduct our operations or to do so profitably.
Further, we have applied for a number of approvals that are currently pending with various regulatory authorities, such
as applications filed for environmental clearances and forest clearances and requisite approvals from the various state
pollution control boards for our operations in certain areas. Further, we have applied for extension of a number of our
mining leases which have expired or will expire in the near future. There can be no assurance that we will be able to
satisfy all of the terms and conditions of the extension of these mining leases and in the event that we are unable to
extend the mining leases, our results of operations will be adversely affected. Further, we are in the process of applying
for certain environmental clearances in order to expand some of our existing mines, reopen some of our mines which
are currently closed and establish new mines. In addition, a number of licenses that we held, such as licenses obtained
pursuant to environmental legislations, have expired and we have made extension applications for the same with the
relevant authorities. For example, we have been asked to provide a bank guarantee of Rs. 571.00 lakhs, stage -1 forest
clearance and a copy of the extended mining lease for the grant of the environment clearance for the Surda mine. We
have also made fresh applications for certain licenses that we now require, such as licenses relating to our mining
activities. If we fail to obtain or retain any of these approvals, licenses, registrations or permits in a timely manner, or
at all, our ability to continue our operations may be adversely affected. If we fail to obtain such regulatory approvals
45
or comply with these conditions, or a regulatory authority claims that we have not complied with these conditions, it
could have a material adverse effect on our business, prospects, financial condition and results of operations.
If we fail to obtain these approvals or extensions in a timely manner, or at all, our ability to continue our operations
may be adversely affected. If we fail to obtain such regulatory approvals or comply with these conditions, or a
regulatory authority claims that we have not complied with these conditions, it could have a material adverse effect
on our business, prospects, financial condition and results of operations.
Moreover, some of these approvals are subject to certain conditions, the non-fulfilment of which may result in
revocation of such approvals. Even after such required licenses, permits and approvals have been obtained, our
operations will be subject to continued review and the governing regulations may change. We cannot assure you that
the approvals, licenses, registrations and permits issued to us would not be suspended or revoked in the event of non-
compliance or alleged non-compliance with any terms or conditions thereof, or pursuant to any regulatory action. If
we fail to comply with all applicable regulations or if the regulations governing our business or their implementation
change, we may incur increased costs, be subject to penalties and suffer a disruption in our operations, any of which
could materially and adversely affect our business and results of operations. Further, a demand of Rs. 4,353.78 lakh
was raised by the District Mining Officer of Jamshedpur for running the Surda mine without valid environment
clearance, which was further increased to Rs 12,690.49 lakhs by the office of the District Mining Officer and
subsequently revised to Rs 92,940.06 lakh by the State Government. While an interim stay has been granted against
the demand by the Revisional Authority till the next date of hearing, any adverse order will have a significant adverse
effect on our business, operations and financial results.
Further, certain of our contractors and other counterparties are required to obtain approvals, licenses, registrations and
permits with respect to the services they provide to us. We cannot assure you that such contractors or counterparties
have obtained and will maintain the validity of such approvals, licenses, registrations and permits. We cannot assure
you that we or any other party will be able to obtain or comply with all necessary licenses, permits and approvals
required for our operations in a timely manner to allow for the uninterrupted construction or operation of our business,
or at all.
8. There are two major refined copper producers in India, and we could be adversely affected by changes in the
business or financial condition of these producers or by the loss of their business.
In Fiscal 2020, we sold all of our surplus copper concentrate to primarily one of these major refined copper producers
in India. Through the planned expansion of our mining capacities, we expect that copper concentrate, rather than
refined copper products, will be our primary product in the future. We expect that we will continue to sell most or all
of our copper concentrate to this large refined copper producers in India, where our cost advantages are most
prominent. A significant downturn in the business or financial condition of the customer could adversely affect our
results of operations. If our relationship with this customer deteriorates or is terminated in the future, we may be
required to seek new customers within or outside India. In the event that we are required to sell our copper concentrate
to international refined copper producers, our cost advantages would be less pronounced and our results of operations
and financial condition could be adversely affected.
9. We may not be successful in implementing our strategies.
The success of our business will depend greatly on our ability to effectively implement our business and strategies.
For more information, see “Business – Strategies” on page 128. Even if we have successfully executed our business
strategies in the past, there can be no assurance that we will be able to execute our strategies on time and within the
estimated budget, or that we will meet the expectations of targeted customers. We expect our strategies to place
significant demands on our management and other resources and require ourselves to continue developing and
improving our operational, financial and other internal controls. One of our key strategies is to expand our current ore
production level from approximately 3.97 million tons per annum (“MTPA”) as on March 31, 2020 to 12.2 MTPA in
phase –I (under implementation) and subsequently to 20.2 million tons per annum in phase-II. We expect that this
strategy will place significant demands on our management, mining technology and capital expenditure. Part of the
capital expenditures required for this key strategy will be funded out of the Net Proceeds. Additionally, we are also
required to amend our various policies such as delegation of powers, performance management system, use of
integrated business automations tools, etc. to ensure that we are able to successfully implement our expansion plane.
Our inability to implement and manage this key strategy as well as others could have an adverse effect on our business,
financial condition and profitability.
46
10. Our expansion, reopening and new mine projects may require significant capital expenditure and may not be
completed in the timeframe or at cost levels originally anticipated, and we may not achieve the intended
economic results.
We currently have a number of expansion, reopening and new mine projects planned for our mining operations. We
are in the process of expanding our mining capacities from approximately 3.97 MTPA as on March 31, 2020 to 12.2
MTPA in phase –I (under implementation) and subsequently to 20.2 million tons per annum in phase-II This expansion
plan includes (i) development of underground mine under existing open cast mine at Malanjkhand; (ii) expanding our
existing mines, namely Khetri, Kolihan and Surda; (iii) reopening some of our mines that were closed in the past
namely Kendadih and Rakha; and (iv) establishing new mines/mining blocks, namely Banwas, Chapri, Sideshwar and
Dhobani mine. Any of these prospects may lead to unforeseen delays or expenses. See “Our Business – Increased
Focus on Copper Mining and Expansion of Our Mining Capacity” on page 128.
These projects and any other future projects can require many years to reach anticipated production targets and could
be significantly delayed by failure to receive necessary licenses, regulatory approvals or to obtain sufficient funding,
or due to difficulties in sourcing additional water or power requirements, construction delays, technical difficulties,
human resources, technological or other resource constraints, or for other unforeseen reasons, events or circumstances
that could affect our results of operations. The funding requirements and project costs for these planned expansion,
reopening and new mine projects are based on management estimates.
We estimated that the project costs for expansion of the existing mine at Khetri and Kolihan of our KCC mining
complex would amount to approximately Rs. 91,000 lakhs. For the expansion of the Malanjkhand mine of MCP, we
estimated that the development of the underground mine under existing open cast mine for both phases would amount
to approximately Rs. 2,90,000 lakhs. For the expansion of the Surda mine of ICC, we estimated that the project costs
would amount to approximately Rs. 35,000 lakhs . For the reopening of the Rakha mine and Kendadih mine of ICC,
we estimated that the project costs would amount to approximately Rs. 55,000 lakhs and Rs. 9,500 lakhs, respectively.
For the establishment of the Dhobani mine and Chapri-Sideshwar mine at ICC, we estimated that the project costs
would amount to approximately Rs. 5,500 lakhs and Rs. 55,000 lakhs, respectively. Further, we estimate an
expenditure of Rs. 9,000 lakhs for the establishment of the mine at Banwas. In total, we estimate that will require Rs.
5,50,000 lakhs for implementing our proposed expansion plan. The implementation of these expansion, reopening and
new mine projects is subject to a number of variables, and the actual amount of capital required for these projects may
differ from our estimates. We cannot guarantee that the funding requirements of any particular project will not
substantially exceed these estimates.
To fund all of our expansion, reopening and new mine projects as well as our other capital expenditures and working
capital requirements, we will be required to obtain debt financing or other capital investment. Further, we shall be
utilising our Net Proceeds towards our expansion plan. There can be no assurance that we will achieve such financing
in a timely manner and on favourable terms, or at all. Further, as of December 31, 2020, we have an outstanding debt
(excluding accrual interest) of Rs. 127,041.84 lakhs. Future debt financing, if available, may still result in increased
finance charges, increased financial leverage, decreased income available to fund further acquisitions and expansions
and the imposition of restrictive covenants on our business and operations. In addition, future debt financing may limit
our ability to withstand competitive pressures and render us more vulnerable to economic downturns. If we fail to
generate or obtain sufficient additional capital in the future, we could be forced to reduce or delay the planned
expansion, reopening or new mine projects or other capital expenditures.
11. If we fail to maintain an effective system of internal controls, we may be unable to accurately report our
operating and financial results or prevent fraud, and investor confidence and the market price of our ordinary
shares may be adversely affected.
We are a public sector undertaking company with limited disclosure and accounting personnel and other resources
with which to address our internal controls and procedures for both our disclosures and our financial controls. We
have, in the past, experienced disclosure issues. Our previous statutory auditors have, without qualifying their audit
report, noted certain deficiencies in internal controls in our financial statements for the Fiscals 2018, 2019 and 2020.
Further, we have had to make significant write-offs in Fiscal 2020 as one time adjustment of closing stock totalling to
an amount of Rs. 25,710.39 lakhs arising as a result of reconciliation of metal content in copper concentrate on inter-
unit transfer and sales, assessment of metal loss in generation of granulated dump slag, handling losses and old and
47
oxidised concentrate for the period between the years 2008 to 2020. Further, provision amounting to Rs. 18,331.80
lakh has been made against Mill Scat and Lean Ore at MCP, which are not presently in use and have no realisable
value at present. If we are unable to implement solutions to any weaknesses in our existing internal controls and
procedures, or if we fail to maintain an effective system of internal controls in the future, we may be unable to
accurately report our operating and financial results or prevent fraud and investor confidence and the market price of
our equity shares may be adversely impacted.
12. We have debt agreements which contain restrictive covenants, placing significant limitations on us, which
could restrict our ability to conduct our business and grow our operations and may impact our results of
operations.
Some of the debt agreements entered into by us contain restrictive covenants, which, among other things, restrict our
ability to raise additional equity, incur additional debt, pay dividends, make investments, engage in transactions with
affiliates, create liens, mortgage, charge or create any security on the assets, sell assets or acquire facilities or other
businesses and change capital structure, amongst other things. Any default of such restrictions will entitle the
respective lenders to call a default against us, enforce remedies under the terms of the financing documents, that could
include, among other things, acceleration of repayment of the amounts outstanding under the financing documents,
enforcement of the security interest created under the financing documents, taking possession of the secured assets or,
at their option, terminate the relevant loan agreements.
A default by us under the terms of any financing document may also trigger a cross-default under our other financing
documents, or our other agreements or instruments containing cross-default provisions, which may individually or in
the aggregate, have an adverse effect on our business, results of operations, financial condition and credit rating. Also,
we may have to dedicate a substantial portion of our cash flow from operations to make payments under the financing
documents, thereby reducing the availability of our cash flow to fund capital expenditures, meet working capital
requirements and use for other general corporate purposes. Such defaults may also result in a decline in the trading
price of the Equity Shares and you may lose all or part of your investment. If the lenders of a material amount of the
outstanding loans declare an event of default simultaneously, we may be unable to pay our debts as they fall due.
13. Our Surda mine expansion project has not yet obtained the necessary environmental and other regulatory
approvals and we have not yet awarded contracts in connection with the proposed expansion.
Our proposed phase-1 Surda mine expansion project which envisages the enhancement of the copper ore production
capacity from 0.31 MTPA to 0.9 MTPA has been suspended since April, 2020 due to non-extension of the mining
lease by the Government of Jharkhand. While we have applied for the extension of the mining lease, our extension
application may not be successful and may be rejected. Further, we do not have the necessary environmental and other
regulatory approvals for the operation of the Surda Mine. The Expert Appraisal Committee of Ministry of
Environment, Forest and Climate Change (“MoEFCC”) had recommended in August 2020, that the proposal for
Environment Clearance is subject to extension of the mining lease, providing a bank guarantee of Rs. 571.00 lakhs
and stage -1 forest clearance. Failure to obtain the extension of the mining lease, necessary approvals and clearances
within the expected timeframe may delay our planned expansion and adversely affect our prospects.
14. Our operations are subject to operating risks that could result in decreased production or increased cost of
production, which could adversely affect our business, results of operations and financial condition.
The success of our business is subject to operating conditions and events beyond our control that could, among other
things, increase our mining, processing, transportation or production costs, disrupt or halt operations at our mines and
production facilities permanently or for varying lengths of time, or interrupt the transportation of our semi-finished
products between our facilities and our finished products to our customers. These conditions and events include:
Availability of water.
Water is critical in copper mining operations and refined copper production, especially for our operations at KCC,
ICC and MCP and our proposed expansion plans. This is particularly so for KCC as the facility is located in a desert
area. Water at our KCC facilities is sourced from tube wells located approximately 26 km to 42 km away and is
supplied through a water pipeline of a total length of approximately 17 km. Further, KCC has an agreement with the
State Government to supply 4 million litre of water per day from the Kumbharam Project. Water at ICC and MCP is
sourced from the Subarnarekha River and the Banjar River which are approximately 0.2 km and approximately 4.5
48
km away, respectively. Any disruptions in water supply could seriously hamper our copper production and may
adversely affect our business, operating revenues and results of operations. In the past, we have encountered water
problems at KCC and MCP. In Fiscal 2020, our metal in concentrate production was affected due to water shortage at
KCC. There is no assurance that disruptions to our water supply will not occur in the future and any such disruptions
may adversely affect our operations, financial condition and results of operations.
Disruptions in mining and production due to equipment failures, unexpected maintenance problems and other
interruptions.
All of our operations are vulnerable to disruptions due to equipment failures, unexpected maintenance problems and
other interruptions. Ore processing plants are especially vulnerable to interruptions, particularly where an event causes
a stoppage which necessitates a shutdown in operations. This could materially and adversely affect our results of
operations or financial condition. The losses from such interruptions include lost production, repair costs and other
expenses.
Availability of electricity.
We require substantial electricity for our copper mining and refining and energy costs represent a significant portion
of the production cost for our operations. Our mining complexes are located in remote areas and we rely on the state
electricity boards for almost all the electricity requirements for our production facilities. We maintain electricity
generators at our facilities to meet emergency requirements. State electricity boards are not always able to consistently
meet our requirements especially as our mining complexes are located in remote areas that require transmission over
greater distances. If for any reason such electricity is not available, we will need to rely entirely on our own backup
electricity generators. If our backup facilities are not sufficient, we may need to shut down our plants until an adequate
supply of electricity is restored. Interruptions of electricity supply can also result in production shutdowns, increased
costs associated with restarting production and the loss of production in progress. Historically, we have not
experienced significant power interruption but we cannot assure you that such power interruptions will not occur in
the future. Furthermore, any increase in the cost of such purchased power would adversely affect our cost of production
and profitability.
Accidents at mines, smelters, refineries and related facilities.
Mining operations are subject to risks normally associated with exploration, development and production of natural
resources, any of which could disrupt our operations, cause damage to property or cause injury or fatalities among our
workforce. Any fires, flooding, explosions or other accidents causing personal injury, property damage or
environmental damage at or to our mines, smelters, refineries or related facilities may result in significant losses,
expensive litigation, imposition of penalties and sanctions or suspension or revocation of permits and licences. In
addition, certain risks associated with our mining activities may have a negative effect on our ability to economically
extract our resources, thereby reducing our stated reserves.
Risks associated with our open-pit mining operations include flooding of the open-pit, collapses of the open-pit wall,
slope failure and operation of large equipment for open-pit mining and rock transportation. The open-pit mines get
deeper as we mine them, presenting certain geotechnical challenges including the possibility of slope failure. If we
are required to decrease pit slope angles or provide additional road access to prevent such a failure, the cost of
operating our mines would increase, which would negatively affect how much of our ore resources we could
economically extract, thereby reducing our stated ore reserves and could negatively affect our results of operations
and financial conditions. Further, hydrological conditions relating to pit slopes, removal of material displaced by slope
failures and increased stripping requirements could also negatively affect our stated reserves in this manner. We have
taken action in order to maintain slope stability, but we cannot assure you that we will not have to take additional
action in the future or that any action taken will be successful. If any of our open-pit mines experience unexpected
slope failure, or we are required to take additional measures to prevent slope failure, such measures may negatively
affect our results of operations and financial condition, as well as have the effect of diminishing our stated ore reserves.
Risks associated with our underground mining operations include underground fires and explosions (including those
caused by flammable gas), cave-ins or ground falls, discharges of gases or toxic substances, flooding, sinkhole
formation and ground subsidence.
Accidents may also cause disruptions in production. Due to the dangerous nature of our operations, we are subject to
49
extensive health and safety laws. A violation of health and safety laws or failure to comply with the requirements of
the relevant health and safety authorities could lead to, among other thing, a temporary shutdown of all, or a portion
of, our mines or processing facilities and the imposition of costly compliance procedures. If health and safety
authorities shut down all, or a portion of, our mines or processing facilities or impose costly compliance measures,
our business, financial condition, results of operations and prospects could be materially and adversely affected. We
use a variety of materials and chemicals in our manufacturing processes that may be harmful to humans, as well as in
our smelting operations and in connection with maintenance work on our manufacturing facilities. Because of the
nature of these substances or related residues, we may be liable for certain costs, including, amongst others, costs for
health-related claims or removal or re-treatment of such substances. Certain of our current and former facilities
incorporate asbestos-containing materials, a hazardous substance that has been the subject of health-related claims for
occupational exposure. In addition, although we have developed environmental, health and safety programmes for our
employees, including measures to reduce employee exposure to potentially dangerous substances, and conduct regular
assessments at our facilities, we are currently, and in the future may be, involved in claims and litigation filed on
behalf of persons alleging injury or death caused predominantly as a result of occupational exposure to substances or
other risks at our current or former facilities. It is not possible to predict the ultimate outcome of these claims and
lawsuits due to the unpredictable nature of personal injury litigation. If these claims and lawsuits, individually or in
the aggregate, were finally resolved against us, our results of operations and cash flows could be adversely affected.
Even though we provide safety training to our employees, injuries to and deaths of workers at our mines and facilities
have occurred in the past and may occur in the future. In the past Fiscals, fatal accidents have occurred at our mines.
We cannot assure you that serious or fatal accidents will not occur at our mines and facilities and any of such accidents
may have an adverse effect on our business operations and financial conditions.
Strikes and industrial actions or disputes.
Our employees are represented by labour unions under collective bargaining agreements with varying durations and
expiration dates. We may not be able to satisfactorily renegotiate our collective bargaining agreements when they
expire. In addition, existing collective bargaining agreements may not prevent a strike or work stoppage or other
industrial actions or disputes at our facilities in the future. Strikes, work stoppages and industrial actions or disputes
have occurred in the past and may occur in the future, which may lead to business interruptions and halts in production.
In addition, our businesses may be subject to union demands and litigation for pay raises and increased benefits, and
existing arrangements with trade unions may not be renewed on terms favourable to us, or at all. There can also be no
assurance that work stoppages or other labour-related developments (including the introduction of new labour
regulations in India) will not adversely affect our results of operations or financial condition. Any industrial unrest or
slowdowns which our third party contractors may experience could disrupt the provision of services to us and may
adversely impact our operations and financial condition.
Other risks and hazards.
Our businesses are subject to numerous other operating risks which include: unexpected geological features or
unexpected seismic activity; climatic conditions (including the impact of seasonal variations during the monsoon
months) such as flooding, extreme foggy conditions or drought; rebel or other terrorist vandalism or attacks; tribal
action or protests; environmental hazards; and technical failures. These risks and hazards could result in damage to,
or destruction of, properties or production facilities, may cause production to be reduced or cease at those properties
or production facilities, may result in personal injury, environmental damage, business interruption or possible legal
liability and may result in actual production differing from estimates of production, including those contained in this
Placement Document.
The occurrence of any one or more of these conditions or events could have a material adverse effect on our business,
results of operations and financial condition.
15. There is no assurance that our contractors will perform as contracted and not violate any applicable laws and
regulations.
We have outsourced a portion of our mine operations including our expansion projects to third party contractors. For
example, we have outsourced the operation of the opencast mine at Malanjkhand for enhancement of copper ore to
5.0 MTPA through an EPC contract in 2015 to M/s IVRCL Limited, who has gone into liquidation as a going concern
pursuant to which, as a result of shortage of funds of M/s IVRCL Limited, the progress of development of Malanjkhand
50
underground mine is slow.
In respect of logistics services, we have contracted with a third party logistics provider, to provide a total logistics
solution to us across our operating units. We generally select contractors based on a competitive bidding process.
Although we have established internal control procedures in the selection of contractors, there is no assurance that our
contractors will deliver quality services as contemplated by our outsourcing agreements. In addition, there is no
assurance that our contractors will not violate any applicable laws and regulations in their provision of services. If we
become aware that any of our contractors is involved in any material breach of applicable laws and regulations, we
will pursue all reasonable means for terminating the relevant contracting agreement with such contractor immediately.
In the event that our contractors do not perform as contemplated under the outsourcing agreements or if we are unable
to identify any substitute, our business operations or planned expansion projects may be adversely affected.
16. Fluctuation in exchange rates of Rupees and U.S. Dollars could affect our financial condition and results of
operations.
Our products are priced based on the LME copper price, which is quoted in U.S. Dollars. An appreciation of Rupee
against the U.S. Dollar would mean that our price in U.S. Dollars stays the same, but the amount we receive in Rupee
would decrease. The exchange rate between the Rupee and U.S. dollar has fluctuated substantially in recent years and
may continue to fluctuate significantly in the future. We bear the complete risk of currency exchange rate fluctuations
between the Rupee and the U.S. Dollar and do not totally hedge against currency fluctuations. Any appreciation of
Rupee against the U.S. Dollar may adversely affect our sales and our results of operations.
17. Changes in tariffs, royalties, customs duties and government assistance may adversely affect our profitability
and results of operations.
Copper is sold in the Indian market at a premium to the international prices of these metals due to tariffs payable on
the import of such metals. Between 2001 and 2020, customs duties on imported refined copper were reduced from
35% to 5%. Customs duties on copper concentrate were reduced from 5% to 2% in Fiscal 2007 but further increased
to 2.5% in Fiscal 2011. The GoI may reduce customs duties further in the future, although the timing and extent of
such reductions cannot be predicted. As we sell the majority of the copper we produce within India and price our
products to include the premium created by such tariffs, any further reduction in Indian tariffs on imports will decrease
the premiums we can charge in respect of those sales. Any reduction of such tariffs or customs duties would have an
adverse effect on our results of operations and financial condition.
We pay royalties, NMET (National Mineral Exploration Trust), DMF (District Mineral Foundation fund) and other
taxes imposed by the State Governments based on our extraction of copper ore or a flat monthly dead rent for our
mines which are currently non-operational, to the respective State Governments. The royalties, NMET, DMF, tax rates
and dead rents we pay are subject to change. Any upward revision to the royalty, NMET, DMF, tax rates or dead rents
rates being charged currently will adversely affect our results of operations. We paid Rs. 7,717.04 lakhs in Fiscal
2020, Rs. 9,803.47 lakhs in Fiscal 2019 and Rs. 8,766.16 lakhs in Fiscal 2018 as royalties. Any upward revision to
the royalty rates being charged currently or payment of additional royalty for mining of associated minerals, or any
adverse decision of a court in any dispute over royalty payments that we may be involved in currently or in the future,
will adversely affect our results of operations.
18. We may lose our status as the sole copper ore producing miner in India in the future.
As of the date of this Placement Document, we are the only operating copper ore producing mining company in India
with access to around two-fifths of India’s copper ore reserves and resources as on April 1, 2020. While, we believe
that we have adequate opportunity to benefit financially by increasing our mining capacities, there is no prohibition
against other domestic or international mining companies from obtaining copper ore mining leases in India. If in the
future, the Government provides access to copper ore mines to other entities, we may lose our status as the only
operating copper ore producing mining company in India, which will materially impact our business, operations and
financial results.
19. If we cannot mine existing reserves at competitive costs or cannot secure additional reserves that can be mined
at competitive costs, our profitability and results of operations could decline.
We operate copper ore mining operations at ICC, KCC and MCP to obtain copper ore for production of copper
51
concentrates. Historically, our copper ore mining operations met approximately 60% of our copper concentrate
requirement, the rest being imported. From December 2008, with the closure of our KCC smelter, being one of our
two smelting plants, we have stopped the purchase of copper concentrate. In the future, we plan to expand our copper
ore mining capacities in order to be self-sufficient in respect of copper concentrate requirements and to sell copper
concentrate as our primary product. However, if our existing copper ore reserves cannot be mined at competitive costs
or if we cannot secure additional reserves that can be mined at competitive costs, our profitability and results of
operations will be adversely affected. Furthermore, if the quality of copper ore deteriorates in our existing mines, our
production cost may increase, thereby adversely affecting our results of operations.
Further, we have applied for extension of the mining leases for the Rakha and Surda mine of ICC, however there is
no assurance that mining lease will be extended. Further, there is no assurance that any copper ore that we may extract
from these mines will be of commercially viable quality. If such copper ore is of sub-optimal quality, our production
costs could be higher than anticipated.
20. Any increase in our production costs could reduce our ability to compete and achieve long-term profitability.
Our competitiveness and long-term profitability substantially depends upon our ability to maintain a low cost base,
including low transport, energy and labour costs. There can be no assurance that our cost inputs will be maintained at
current levels. Our cost inputs include power, materials, fuel, transport, rental and labour costs. Labour costs have
significantly increased over the last few years partly because of increased competition for skilled labour. Any increase
in these costs could materially and adversely affect our profitability, financial condition, results of operations and
prospects. We are planning to invest a significant amount of capital to expand our current production level. Our unit
production costs are therefore significantly affected by production volumes given the relatively fixed nature of our
cost base in the short term, and any inability to maximize capacity utilization could impair our overall cost
competitiveness.
21. Our operations are reliant on the timely supply of raw materials and transportation of semi-finished products
between our production facilities and finished products to our customers, which are subject to uncertainties
and risks.
We depend on various forms of transport to receive raw materials used in production, to deliver semi-finished products
between our production facilities and mining complexes and to deliver our products from our production facilities to
our customers. Among these forms of transportation, road transportation is the main transportation utilized by us to
transport semi-finished products between our mining complexes and finished products to our customers. Non-
availability of adequate road transportation due to, among others, strikes, has had in the past and may in the future,
adversely affect our ability to source raw materials and to supply products to our customers. In addition, transportation
may be adversely affected by inadequate infrastructure, adverse weather conditions, mechanical failures, infrastructure
damage, accidents, strikes, insurgency threats, or other factors beyond our control, which could impair our ability to
source raw materials and components or our ability to supply products to our customers. Inadequacies or interruptions
in transportation may also result in increased inventories, or result in decreased, non-optimal production from our
mines due to lack of adequate space to maintain inventories. Increased inventories could also result in loss of stock
through pilferage or otherwise. There can be no assurance that we will have access to adequate transportation
infrastructure and capacities for our existing operations as well as our planned expansion projects. Any non-
availability of adequate transportation infrastructure may adversely affect our business and results of operations as
well as our ability to successfully implement our growth strategies.
22. We are required to comply with environmental laws, and the failure to comply with new environmental laws
could adversely affect our business, operations and financial condition.
Our operations are subject to environmental laws and regulations in India, which govern the discharge, emission,
storage, handling and disposal of a variety of substances that may be used in or result from our operations. We are
required to obtain environmental permits to conduct our operations. In addition, our extension of mining leases are
also subject to environmental clearance. As an industrial business in India, we are required to undertake programmes
to minimize our impact on the environment and to protect natural resources. We are required to actively monitor
specific parameters such as air emissions, wastewater discharge, ambient air quality, quality of nearby surface water,
soil and groundwater quality and the generation of solid waste. We are required to submit an annual statistical report
on these monitoring results to the Indian environmental authorities. The governmental authorities from time to time
conduct independent tests to validate our results.
52
If our emissions exceed certain levels established by the site permits, we could be subject to monetary penalties.
Moreover, in the course, or as a result, of an environmental investigation, regulatory authorities in India can issue an
order reducing or halting production at a facility that has violated environmental standards. If production is reduced
or halted at one or more of our facilities, our business, financial condition, result of operations and prospects could be
materially and adversely affected.
One of the main environmental issues in the mining industry is wastewater and tailings management. Wastewater and
tailings can contain substances that are potentially harmful to human beings and the environment, especially in large
quantities, like heavy metals that may cause cancer, nervous system failure or death in humans and, in the past,
wastewater and tailings seepage has occurred as a result of mining operations. There can be no assurance that we will
not be subject to claims for damages to persons or property resulting from the release into the environment of
wastewater or tailings residue by our operations or be held responsible for the costs of clean-up associated with any
such release into the environment of wastewater or tailings residue by our operations which may be substantial. Such
costs and liabilities could materially and adversely affect our business and results of operations.
Environmental law and regulation of industrial activities in India and across the world may become more stringent,
and the scope and extent of new environmental regulations, including their effect on our operations, cannot be
predicted with any certainty. In case of any change in environmental, or pollution regulations, we may be required to
expend significant amounts on, amongst other things, environmental monitoring, pollution control equipment and
emissions management. We may also be required to bear additional expenditure for the establishment of additional
infrastructure, such as laboratory facilities for monitoring pollution impact and effluent discharge and effluent
treatment or recycling plants. We could also be subject to substantial civil and criminal liability and other regulatory
consequences in the event that an environmental hazard was to be found at the site of any of our plants, or if the
operation of any of our plants results in material contamination of the environment. We may also be the subject to
public interest litigation in India relating to allegations of environmental pollution by our plants, as well as cases
having potential criminal and civil liability filed by state pollution control authorities. New legislation or regulations,
or different or more stringent interpretation or enforcement of existing laws and regulations, may also require us or
our customers to change operations significantly or incur increased costs which could have an adverse effect on our
results of operations or financial condition.
23. We have a number of contingent liabilities and our profitability could be adversely affected if any of these
contingent liabilities materialises.
As of December 31, 2020, our consolidated contingent liabilities were as follows:
(Rs. in lakhs)
Claims against the company not acknowledged as debt: As of December 31, 2020
Disputed VAT / CST / Entry Tax 3,516.76
Disputed Excise Duty 2,947.97
Disputed Income Tax / Provident Fund 23,113.43
Other Demand 43,634.72
Total (A) 73,212.88
Other money for which the company is contingently liable:
Bank Guarantee 1,534.33
Letter of Credit 93.17
Bill discounting -
Total (B) 1,627.50
Contingent Liability (A+B) 74,840.38
If any of these contingent liabilities materialise, our profitability may be adversely affected. For a more detailed
description of our contingent liabilities, see “Financial Statements – Contingent Liabilities” on page 204.
24. We depend on the experience and skills of our management and certain key employees. Any loss of such
persons or failure to timely replace such persons could adversely affect our business.
We are dependent on our management team and certain key employees and our ability to meet future business
challenges depends on their continuation and our ability to attract and recruit talented and skilled personnel. We are
53
in particular dependent to a large degree on the continued service and performance of our senior management team
and other key team members in our business units. The average age of our senior management team is currently over
50 and the mandatory retirement age in India is 60. As such, we are required to impose and successfully implement
appropriate succession plans. These key team members possess technical and business capabilities that are difficult to
replace. The loss or diminution in the services of our key team members, specifically the loss of the senior management
team members with important technical know-how and experience of our operations will adversely affect our business
operations, financial condition and prospects.
In addition, we face strong competition in recruiting and retaining skilled and professionally qualified staff. The
current strong commodity cycle and the large number of projects being developed in the copper industry worldwide
have increased the demand for skilled personnel. As a public sector undertaking in India, GoI policies regulate and
control the emoluments, benefits and perquisites that we pay to our employees, including our key managerial personnel
and other employees. We may be unable to compete with private companies for qualified personnel due to their ability
to offer more competitive salaries and benefits packages. The loss of key personnel or any inability to manage the
attrition levels in different employee categories may adversely affect our business, our ability to grow and our control
over various business functions.
25. The audit reports in respect of our Audited Financial Statements contain certain matters of emphasis
The audit reports for our Audited Financial Statements for Fiscal 2020, 2019 and 2018 contain certain matters of
emphasis. There is no assurance that our auditors’ reports for any future Fiscal periods will not contain matters of
emphasis or that such matters of emphasis will not require any adjustment in our financial statements for such future
periods or otherwise affect our results of operations in such future periods.
For further details please refer to the section titled “Financial Statements” beginning on page 204.
26. We have experienced negative cash flows in the past. If we do not maintain positive cash flow, we cannot
assure you that we will be able to sustain our growth or achieve profitability in future periods.
The following table summarises our standalone cash flows for Fiscal years 2020, 2019 and 2018 and for nine month
period ended December 31, 2020:
(Rs. in lakhs)
Particulars Nine Month period
ended December 31,
2020
Fiscal
2020 2019 2018
Net cash generated from / (used
in) operating activities
60,576.96 8,602.55 25,230.35 37,178.85
Net cash generated from / (used
in) investing activities
(26,229.91) (42,983.85) (58,671.11) (55,750.67)
Net cash generated from / (used
in) financing activities
18,521.85 4,199.22 44,458.28 (9,605.50)
Net increase / (decrease) in
cash and cash equivalents
52,868.90 (30,182.08) 11,017.52 (28,177.32)
We have experienced negative cash flows in Fiscal 2020 and Fiscal 2018. Further, in the last three Fiscals and for the
nine month period ended December 31, 2020, we experienced negative cash flows from investing activities. While we
had positive cash flow in Fiscal 2019 and the nine month period ended December 30, 2020, we cannot assure you that
we will have positive cash flows in future. If our revenues do not grow as expected or if our expenses and working
capital requests increase at a greater rate than we expect, we may not be able to achieve positive cash flow. If we do
not maintain positive cash flow, we cannot assure you that we will be able to sustain our growth or achieve profitability
in future periods.
27. Our Company does not have a woman Director on the Board as required under Section 149 of the Companies
Act, 2013 and Regulation 17(1) of SEBI Listing Regulations and accordingly, penalties have been imposed
upon us.
As per Section 149 of the Companies Act, 2013 and Regulation 17(1) of SEBI Listing Regulations, the Company is
required to have at least one woman Director on its Board. However, with effect from November 16, 2019, the Board
54
of the Company does not have any woman Director. Both BSE and NSE have imposed penalties on the Company for
non-compliance of Regulation 17(1) of SEBI Listing Regulations pertaining to appointment of woman Director on
the Board of the Company. Details of fine imposed on the Company is given below:
Name of
Exchange
Penalty
imposed for
quarter
ended
31.3.2020
Penalty
imposed for
quarter
ended
30.6.2020
Penalty
imposed for
quarter
ended
30.9.2020
Penalty
imposed for
quarter
ended
31.12.2020
Total Penalty
imposed till
date
BSE 2,65,500/- 5,36,900/- 5,42,800/- - 13,45,200/-
NSE 2,65,500/- 5,36,900/- 5,42,800/- 5,42,800/- 18,88,000/-
28. The posts of two of the functional directors remain vacant on our Board.
The posts of two functional Directors namely, Director (Mining) and Director (Operations) are laying vacant on our
Board since December 31, 2019, which is affecting the functioning of the Company. The Company has requested the
Ministry of Mines, Government of India for appointment of these two Functional Directors. At present, Chairman and
Managing Director and Director (Finance) of the Company have been given additional charge of the post of Director
(Operations) and Director (Mining) respectively. Delay in the appointment of the functional directors will impact of
operations, business and the day to day functioning of our Company.
29. Our insurance does not cover all of the risks we face, and the occurrence of events that are not covered by our
insurance could cause losses, which if significant, could adversely affect our financial condition.
We maintain insurance coverage which we believe is consistent with the industry practices and in amounts which we
believe to be commercially appropriate. Nevertheless, we may become subject to liabilities, including liabilities for
business interruption, product liability, pollution or other hazards, against which we may not have adequate insurance,
or at all, or cannot insure. Our insurance policies contain exclusions and limitations on coverage, and we do not have
business interruption insurance. We do not have insurance for business interruptions, product liability or certain types
of environmental hazards, such as pollution or other hazards arising from the disposal of waste products and, for a
substantial part of our business, terrorist insurance. The occurrence of a significant adverse event, the risks of which
are not fully covered by insurance, could have a material adverse effect on our financial condition or results of
operations. Moreover, no assurance can be given that we will be able to maintain our existing level of insurance, or
obtain additional insurance, in the future at acceptable rates.
As a result, our insurance coverage may not cover the extent of any claims against us, including for environmental or
industrial accidents or pollution.
30. We may be obligated to consider non-economical concerns in the operating of our refining plants.
As a public sector undertaking, we may make operating decisions based on factors that do not typically affect private
companies. For example, our smelting and refining operations require a significant number of employees and actions
to close, suspend or reduce our operating capacity that result in the loss of jobs could potentially result in social unrest
or political ramifications. Consequently, we may decide to continue operating our smelting and refining plants even
if, economically, there are better uses of our capital and copper concentrate. If we decide to continue operating our
smelting and refining plants due to these other non-economical reasons, it could have an adverse effect on our results
of operations or financial condition.
31. Announcements by the GoI relating to increased wages for government and public sector employees will
increase our expenses and may adversely affect our financial condition in the years of implementation.
In the past, the Department of Public Enterprises (“DPE”) has required government enterprises to implement salary
increases for employees below executive level as determined by the respective boards and management of the relevant
government enterprises within a certain guideline set by the DPE. Further, post the implementation of the seventh pay
commission, our employees of the salaries were further increased. These governmental measures increase our labour
costs and there is no assurance that additional measures or further increases will not be introduced by the GoI. Any
announcements by the GoI relating to increased wages for government and public sector employees will increase our
55
expenses and may adversely affect our operating results and financial condition.
32. We cannot register “Hindustan” as a trademark.
Our ability to market and sell our products depends upon the recognition of our brand name and associated consumer
goodwill. We cannot register “Hindustan” as a trademark under the Trade Marks Act, 1999. Consequently, we do not
enjoy the statutory protections accorded to registered trademarks in India for the corporate name of our Company.
Therefore, we may be unable to capitalize on the brand recognition associated with Hindustan Copper Limited. Loss
of the right to use our corporate name may adversely affect our ability to conduct our business as well as affect our
reputation, and consequently, our results of operations.
33. If we do not continue to invest in new technologies and equipment, our technologies and equipment may
become obsolete and our cost of production may increase relative to our competitors, which would have a
material adverse effect on our ability to compete, results of operations, financial condition and prospects.
Our profitability and competitiveness are in large part dependent upon our ability to maintain a low cost of production
as we sell commodity products with prices we are unable to influence. Unless we continue to invest in newer
technologies and equipment and are successful at integrating such newer technologies and equipment to make our
operations more efficient, our cost of production relative to our competitors may increase and we may cease to be
profitable or competitive. For example, trial use of hi-chrome grinding media was initiated at our MCP plant which
we believe resulted in cost saving in the grinding media per ton of milling. However, newer technologies and
equipment are expensive and the necessary investments may be substantial. Moreover, such investments entail
additional risks as to whether the newer technologies and equipment will reduce our cost of production sufficiently to
justify the capital expenditures to obtain them. Any failure to make sufficient or the right investments in newer
technologies and equipment or in integrating such newer technologies and equipment into our operations could have
a material adverse effect on our ability to compete and our financial condition, results of operations and prospects.
34. Intrusions and breaches into the security of our IT infrastructure could damage our operations, reputation or
result in a liability to us.
We maintain a number of information databases on our internal network and customers access our website to tender
bids for our products making our ability to sell our products reliant on the uninterrupted operation of our IT
infrastructure. Any shortcomings or failures in our IT infrastructure would limit our ability to process sales transactions
and would adversely affect our results of operations. Our financial, accounting or other data processing systems may
fail to operate adequately or become disabled as a result of events that are wholly or partially beyond our control,
including a disruption of electrical or communications services. If any of these systems do not operate properly or are
disabled or if there are other shortcomings or failures in our internal processes or systems, it could affect our operations
or result in financial loss, disruption of our businesses, regulatory intervention or damage to our reputation. In addition,
our ability to conduct business may be adversely impacted by a disruption in the infrastructure that supports our
businesses and the localities in which we are located. Our operations also rely on the secure processing, storage and
transmission of confidential and other information in our computer systems and networks. Our computer systems,
software and networks may be vulnerable to unauthorized access, computer viruses or other malicious code and other
events that could compromise data integrity and security. If our security measures are circumvented, the security of
confidential and propriety information stored on our systems could be jeopardized, or our operations could be
interrupted. A material security breach could damage our reputation or result in liability to us, and we do not carry
insurance that protects us from this kind of loss.
35. Some of our immovable properties may have certain irregularities in title, as a result of which our operations
may be impaired.
We possess immovable properties at various locations for the purposes of our business, held either on freehold or
leasehold basis. We acquire our mining land under various mining leases executed with the respective state
governments. Certain of our properties have also been acquired through the process instituted under the Land
Acquisition Act. We have also purchased some of our land from private owners. Registration of land title in India is
not centralized and has not been fully computerized. Land records are often hand-written in local languages and may
not be legible or correctly spelt and at time, may be in poor condition or untraceable, making it difficult to ascertain
title. Title risks can be particularly acute where fragmented land rights are acquired from agriculturalists and small
landholders. Further, title records in India presently provide only for presumptive title rather than a guaranteed title to
56
the land. Indian law, for example, recognizes the ability of persons to effect a valid mortgage on an unregistered basis
by the physical delivery of original title documents to a lender. Adverse possession under Indian law also gives rise,
on 12 years‘ occupation, to valid ownership rights as against all parties, including government entities that are
landowners, without the requirement of registration of ownership rights by the adverse possessor. Title to land may
be defective as a result of a failure on our part, or on the part of a prior transferee, to obtain the consent of all such
persons or duly complete stamping and registration requirements. The uncertainty of title to land may impede the
processes of acquisition, independent verification and transfer of title, and any disputes in respect of land title that we
may become party to may take several years and considerable expense to resolve if they become the subject of court
proceedings.
For instance, the title deeds for Freehold and Leasehold Land and Building acquired in respect of GCP with book
value of Rs. 5,578.11 lakhs are yet to be executed. Further, the title deeds, conveyance deeds, etc. in respect of certain
freehold lands at ICC acquired through nationalization in accordance with Indian Copper Corporation (Acquisition of
Undertaking) Act, 1972 are not in possession of the Company.
Our business may be affected if we are unable to continue to utilize our owned and leased properties as a result of any
irregularity of title or otherwise.
36. We may not maintain historical dividends in the future.
Our Company did not declare any dividend in Fiscal 2020. While we have paid dividends in the past, there can be no
assurance as to whether we will pay dividends in the future and, if so, the level of such future dividends. Our
declaration, payment and amount of any future dividends is subject to the discretion of the Board, and will depend
upon, among other factors, our revenues, financial position, cash requirements and availability of profits, as well as
the provisions of relevant laws in India from time to time. For further details, please see “Dividends” on page 76.
37. Our workforce is exposed to various operational risk and hazards.
Our operations subject our workforce to hazards inherent in mining operations, such as risk of equipment failure,
impact from falling objects, collision, work accidents, fire, or explosion, including hazards that may cause injury and
loss of life, severe damage to and destruction of property and equipment and environmental damage. Although we
have taken insurance coverage to reduce the damage or losses from such circumstances, we cannot assure that we
would be absolved from any future liability, if any which may arise as a result of these hazards.
38. Our business is subject to seasonal and other fluctuations that may affect the functioning of the projects
thereby adversely affecting our cash flows and business operations.
Our business and operations may be affected by seasonal factors which may restrict our ability to carry on activities
related to our projects and fully utilize our resources. Heavy or sustained rainfalls or other extreme weather conditions
such as cyclones could result in delays or disruptions to our operations during the critical periods of our projects and
cause severe damages to our premises and equipment. In particular, the monsoon season may restrict our ability to
carry on activities related to our projects and fully utilize our resources. This may result in delays in execution of
projects and also reduce our productivity. During periods of curtailed activity due to adverse weather conditions, we
may continue to incur fixed expenses and our project related activities may be delayed or reduced. Adverse seasonal
developments may also require the evacuation of personnel, suspension or curtailment of operations, resulting in
damage to construction sites or delays in the delivery of materials. Such fluctuations may adversely affect our toll
revenues, cash flows, results of operations and financial conditions.
39. The requirement of funds for our expansion plan as stated in this Placement Document have not been
independently verified and utilization of proceeds of the Issue will not be subject to monitoring by any
independent agency.
The requirement of funds for our expansion plans which we propose to partially fund from the Net Proceeds, as stated
in the section “Use of Proceeds” on page 68 are based on internal management estimates and have not been subjected
to any independent verification. These estimated costs have been derived from the EPC contracts awarded by our
Company to the third parties for the expansion activities and management estimates and do not include any escalation
costs. Further, the utilization of the proceeds of the Issue will not be subjected to any monitoring by any independent
agency.
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40. Any increase in competition in the refined copper markets could result in lower prices or sales volumes of
refined copper produced by us, which may cause our profitability to suffer.
We sell most of our refined copper in the domestic market. We face intense competition from domestic manufacturers
and imports. Our domestic competitors are larger than us in terms of production capacities and volumes. These
companies are also expanding their production capacities. If domestic demand is not sufficient to absorb these
increases in capacity, our competitors could reduce their prices, which may require us to do the same or cause us to
lose market share to our competitors or sell our products in overseas markets at relatively lower prices. Should the
price of our products decline, our profit margins would decline, and without a sufficient increase in our sales volume,
our revenues would also decline.
In addition, the end-user markets for certain value-added copper products are highly competitive. Copper competes
with other materials particularly plastic, steel, iron, glass, and paper, amongst others, for various applications. In the
past, customers have demonstrated a willingness to substitute other materials for copper. The willingness of customers
to accept substitutes could have an adverse effect on our business, results of operations and prospects.
41. India has a limited amount of indigenous copper ore reserves and we may not be able to secure additional
reserves in India that can be mined at competitive costs in the future.
As of April 1, 2015, India‘s total copper ore resources were estimated at 1511.5 million tonnes (as classified under
the UNFC system). This represents a small portion of copper ore reserves as compared to worldwide and other regional
and national copper ore reserves. In the future, the economically feasible reserves within India may become exhausted,
potentially as a direct result of depletion from our mining operations, requiring us to evaluate the acquisition of copper
resources outside of India. We could face competition from other mining enterprises, both domestic and foreign, in
discovering, acquiring and producing these resources. There can be no assurance that we can effectively compete with
existing or future competition to acquire mineral resources, and any failure to compete effectively could materially
and adversely affect our business and results of operations.
42. An increase in the prices of mining or refining equipment may adversely affect our business.
Due to the significant expansion of mining investments worldwide and changes in copper prices, mining and refining
equipment prices have increased significantly. Increases in the cost of mining or refining equipment may increase
mining and refining costs and could have a negative effect on the profitability margins of our mining business and
consequently may adversely affect our business, results of operations and financial condition.
43. We will continue to be controlled by the GoI following this Issue. The interests of the GoI as our controlling
shareholder may conflict with your interests as a shareholder.
After the completion of the Issue, the GoI will hold approximately 70,35,87,852 Equity Shares, or approximately
72.76 % of our post-Issue paid-up capital. Consequently, the GoI will retain control over the decisions requiring
adoption / approval by the shareholders and will also retain the power to elect and remove our Directors and therefore
determine the outcome of most proposals for corporate action requiring approval of our Board.
The interests of the GoI with respect to such matters and the factors that it will take into account when exercising its
voting rights, including with respect to five year plans, revenue budgets, capital expenditure, the payment of dividends
and transactions with other public sector companies, may not be consistent with those of our other shareholders,
including investors that purchase our Equity Shares in the Issue. The GoI could, by exercising its powers of control,
initiate, delay or defer a merger, consolidation, takeover or other business combinations involving us or our
competitors and peers, or discourage a potential acquirer from making a tender offer or otherwise attempting to obtain
control of us. Further, given the importance of the mining industry to the economy and the mass consumption of
certain mining products by Indian industries, the GoI could require us to take actions designed to serve the public
interests of India and not necessarily to maximize profits. In addition, as a result of our ownership by the GoI, we are
required to respect certain restrictions with respect to the types of investments we may make using our cash balances,
which effectively restricts us from entering into certain investments providing a higher rate of return.
Under our Memorandum of Understanding with the Ministry of Mines and as per our Articles of Association, the GoI
may issue directives with respect to the conduct of our business or affairs or impose other restrictions. For example,
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under Article 70 of our Articles, the President of India has the power to appoint and remove all members of the Board
of Directors. Pursuant to Article 72 of our Articles, Government approval is required for our undertaking of any capital
expenditure exceeding a specified amount. Under Article 83 of our Articles, approval from the President of India is
required for certain matters, such as entry into any partnership or acquisition of shares in other companies.
B. Risks Relating to India
1. Our business is substantially affected by prevailing economic, political and other prevailing conditions in India
and the other markets we currently service.
In Fiscal 2020, we sold 42.57% of our copper concentrate and refined copper products to customers in India. The
performance and growth of our business are necessarily dependent on the health of the overall Indian economy and
key infrastructure sectors such as electrical, telecom and construction. As a result, we are highly dependent on
prevailing economic conditions in India and our results of operations are significantly affected by factors influencing
the Indian economy. Factors that may adversely affect the Indian economy, and therefore our results of operations,
may include:
• any increase in interest rates or inflation;
• any exchange rate fluctuation;
• any scarcity of credit or other financing in India, resulting in an adverse impact on the economic conditions in
India and scarcity of financing of our developments and expansions;
• political instability, a change in government or a change in the economic and deregulation policies;
• domestic consumption and savings;
• balance of trade movements, namely export demand and movements in key imports (oil and oil products);
• annual rainfall in India which affects agricultural production;
• any exchange rate fluctuations;
• any scarcity of credit or other financing, resulting in scarcity of financing for our expansions;
• prevailing economic and income conditions among consumers and corporations;
• volatility in, and actual or perceived trends in trading activity on, India’s principal stock exchanges;
• changes in tax, trade, Fiscal or monetary policies, including application of GST;
• political instability, terrorism or military conflicts in India or in countries in the region or globally;
• occurrence of natural or man-made disasters;
• infectious disease outbreaks or other serious public health concerns;
• prevailing regional or global economic conditions, including in India’s principal export markets;
• other significant regulatory or economic developments in or affecting India or its iron or steel sector;
• increase in India’s trade deficits or such trade deficits becoming unmanageable; and
• decline or future material decline in India’s foreign exchange reserves.
Any slowdown or perceived slowdown in the Indian economy, or in specific sectors of the Indian economy, could
adversely impact our business, results of operations and financial condition and the price of the Equity Shares. Our
performance and the growth of our business depend on the performance of the Indian economy and the economies of
the regional markets we currently serve. These economies could be adversely affected by various factors, such as
political and regulatory changes including adverse changes in liberalization policies, social disturbances, religious or
communal tensions, terrorist attacks and other acts of violence or war, natural calamities, interest rates, commodity
and energy prices and various other factors. Any slowdown in these economies could adversely affect the ability of
our customers to afford our services, which in turn would adversely impact our business and financial performance
and the price of the Equity Shares.
High rates of inflation in India could increase our costs without proportionately increasing our revenues, and as such
decrease our operating margins. Any slowdown or perceived slowdown in the Indian economy, or in specific sectors
thereof, could adversely impact our business, results of operations and financial condition and the price of the Equity
Shares.
If India’s trade deficits increase or become unmanageable, the Indian economy, and therefore our business, future
financial performance, cash flows and the trading price of the Equity Shares could be adversely affected.
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A decline or future material decline in India’s foreign exchange reserves could impact the valuation of the Rupee and
could result in reduced liquidity and higher interest rates which could adversely affect our financial condition and
future financial performance.
2. Changing laws, rules and regulations and legal uncertainties including adverse application of tax laws and
regulations such as application of Goods and Service Tax, may adversely affect our business results of
operations, cash flows and financial performance.
Our business and financial performance could be adversely affected by changes in law or interpretations of existing,
or the promulgation of new, laws, rules and regulations in India applicable to us and our business. There can be no
assurance that the central or the state governments may not implement new regulations and policies which will require
us to obtain approvals and licenses from the governments and other regulatory bodies or impose onerous requirements
and conditions on our operations. Any change in such RBI regulation may have a severe impact on our businesses
outside India or any expansion plans that involve support from our local operations. Any new regulations and policies
and the related uncertainties with respect to the implementation of the new regulations may have a material adverse
effect on all our business, financial condition and results of operations. In addition, we may have to incur capital
expenditures to comply with the requirements of any new regulations, which may also materially harm our results of
operations. The Government of India has enacted the Central Goods and Services Tax Act, 2017 which lays down a
comprehensive national GST regime which has combined taxes and levies collected by the central and state
governments into a unified rate structure. This legislation was notified and made effective from July 1, 2017.
The Government has also proposed major reforms in Indian tax laws with respect to the provisions relating to the
general anti-avoidance rule (“GAAR”). As regards GAAR, the provisions have been introduced in the Finance Act,
2012 and have come into effect from April 1, 2017. The GAAR provisions intend to catch arrangements declared as
“impermissible avoidance arrangements”, which is any arrangement, the main purpose of which is to obtain a tax
benefit and which satisfy at least one of the following tests (i) creates rights, or obligations, which are not ordinarily
created between persons dealing at arm’s length; (ii) results, directly or indirectly, in misuse, or abuse, of the
provisions of the Income-tax Act; (iii) lacks commercial substance or is deemed to lack commercial substance, in
whole or in part; or (iv) is entered into, or carried out, by means, or in a manner, which are not ordinarily employed
for bona fide purposes. If GAAR provisions are invoked, then the Indian tax authorities have wide powers, including
denial of tax benefit or a benefit under a tax treaty. As the taxation system is intended to undergo significant overhaul,
its consequent effects on us cannot be determined at present and there can be no assurance that such effects would not
adversely affect our business and future financial performance.
The consequences of the GAAR provisions being applied to an arrangement could result in denial of tax benefit
amongst other consequences. In the absence of any precedents on the subject, the application of these provisions is
uncertain. The application of various Indian tax laws, rules and regulations to our business, currently or in the future,
is subject to interpretation by the applicable taxation authorities. If such tax laws, rules and regulations are amended,
new adverse laws, rules or regulations are adopted or current laws are interpreted adversely to our interests, the results
could increase our tax payments (prospectively or retrospectively) and / or subject us to penalties. Further, changes in
capital gains tax or tax on capital market transactions or sale of shares could affect investor returns. As a result, any
such changes or interpretations could have an adverse effect on our business and financial performance
3. Financial instability in other countries, particularly countries with emerging markets, could disrupt Indian
markets and our business and cause the trading price of the Equity Shares to decrease.
The Indian financial markets and the Indian economy are influenced by the economic and market conditions in other
countries. Although economic conditions are different in each country, investors' reactions to developments in one
country can have adverse effects on the securities of companies in other countries, including India. A loss of investor
confidence in other financial systems may cause volatility in Indian financial markets, including with respect to the
movement of exchange rates and interest rates in India, and, indirectly, in the Indian economy in general. Any such
continuing or other significant financial disruption could have an adverse effect on our business, financial results and
the trading price of the Equity Shares.
4. Changes in the policies of, or changes in, the Indian Government, could adversely affect economic conditions
in India, and thereby adversely impact our results of operations and financial condition.
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India remains our largest market, representing 43% of our total revenues in Fiscal 2020. In addition, our manufacturing
facilities and power plants are located in India. Consequently, we may be affected by changes to Central Government
policies, changes in the Central Government itself, or any other political instability in India. For example, rising
interest rates, increases in taxation or the creation of new regulations could have a detrimental effect on the Indian
economy generally and our business in particular.
The Central Government has sought to implement a number of economic reforms in recent years and has also
continued the economic liberalization policies pursued by previous Central Governments. However, the roles of the
Central Government and the state governments in the Indian economy as producers, consumers and regulators have
remained significant. Any significant change in such liberalization and deregulation policies could adversely affect
business and economic conditions in India generally which may have an adverse effect on the Company’s results of
operations and financial condition.
5. The business and activities of the Company, as applicable, may be regulated by the Competition Act, 2002.
The Competition Act seeks to prevent business practices that have a material adverse effect on competition in India.
Under the Competition Act, any arrangement, understanding or action in concert between enterprises, whether formal
or informal, which causes or is likely to cause a material adverse effect on competition in India is void and attracts
substantial monetary penalties.
Any agreement that directly or indirectly determines purchase or sale prices, limits or controls production, shares the
market by way of geographical area, market, or number of customers in the market is presumed to have a material
adverse effect on competition. Provisions of the Competition Act relating to the regulation of certain acquisitions,
mergers or amalgamations which have a material adverse effect on competition and regulations with respect to
notification requirements for such combinations came into force on June 1, 2011. The effect of the Competition Act
on the business environment in India is unclear and it is difficult to predict its impact on the growth and expansion
strategies of the Company. If the Company, as applicable, is affected, directly or indirectly, by the application or
interpretation of any provision of the Competition Act, or any enforcement proceedings initiated by the Competition
Commission of India (“CCI”), or any adverse publicity that may be generated due to scrutiny or prosecution by the
Competition Commission of India, it may have a material adverse effect on its business, prospects, results of
operations, cash flows and financial condition.
6. If regional hostilities, terrorist attacks or social unrest in India increase, our businesses could be adversely
affected.
India has from time to time experienced instances of civil unrest, terrorist attacks and hostilities with neighbouring
countries. These hostilities and tensions could lead to political or economic instability in India and have a possible
adverse effect on the Indian economy, the Company’s business, prospects, results of operations, cash flows and
financial condition and future financial performance. India has also experienced localized social unrest and communal
disturbances in some parts of the country. If such tensions become more widespread, leading to overall political and
economic instability, it could have an adverse effect on our business, future financial performance and cash flows.
In addition, our current facilities are located in geographically remote areas that may be at risk of terror attacks. Such
attacks may be directed at Company property or personnel, at property belonging to the Company’s customers or at
the state-owned infrastructure used by the Company to transport goods to customers. Such attacks, or the threat of
such attacks, whether or not successful, may disrupt the Company’s operations and / or delivery of goods, result in
increased costs for security and insurance and may adversely impact the Company’s business, results of operations,
financial condition and prospects, as well as place the Company’s assets and personnel at risk.
7. Investors in our Equity Shares offered in the Issue may be unable to enforce a judgment of a foreign court
against us or our Directors or Key Management Personnel named in this Placement Document.
We are a limited liability company incorporated in India. All of our Directors and Key Management Personnel named
in this Placement Document are residents of India and the majority of our assets and such persons’ assets are located
in India. As a result, it may not be possible for investors to effect service of process upon us or such persons outside
India, or to enforce judgments obtained against such parties in courts outside of India. Furthermore, it is unlikely that
an Indian court would enforce foreign judgments if that court were of the view that the amount of damages awarded
was excessive or inconsistent with public policy or if the judgements are in breach of or contrary to Indian law. A
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party seeking to enforce a foreign judgment in India is required to obtain the approval from the RBI to execute such a
judgment or to repatriate outside India any amount recovered pursuant to the execution of the judgment. For further
details, please see section titled “Enforcement of Civil Liabilities” on page 17.
8. Indian laws contain restrictions on the acquisition and transfer of Indian securities by persons resident outside
India. The conversion of the Rupee proceeds from such sale into foreign currency and the repatriation of that
foreign currency from India could require the RBI’s approval. Approvals required from the RBI or any other
government authority may not be obtained on terms favourable to a non-Indian resident investor or at all. Due
to possible delays in obtaining requisite approvals, investors in our Equity Shares may be prevented from
realising gains during periods of price increases or limiting losses during periods of price declines.
Indian laws contain restrictions on the acquisition and transfer of Indian securities by persons resident outside India.
The information below has been provided for the benefit of investors. However, the information below does not
purport to be a complete analysis of the restrictions under Indian laws for the acquisition and/or transfer of securities
in an Indian company by a person resident outside India. Our Company and its respective officers, directors,
representatives, agents, affiliates and associates and we accept no responsibility or liability for advising any investor
on whether such investor is eligible to acquire Equity Shares offered in the Issue.
Under current Indian regulations and practice, the sale of shares by a non-resident to a resident of India is permitted
if the sale is made on a recognised stock exchange in India through a stock broker registered with the Stock Exchange
or a merchant banker registered with SEBI at the market price or in accordance with the terms of the pricing guidelines
and reporting requirements specified by the RBI in case of an off-market transfer. If the shares are thinly traded, then
certain other pricing guidelines and reporting requirements specified by RBI must be followed. Any transfer of Equity
Shares by a non-resident that is not under the automatic route will require the prior approval of the RBI. The conversion
of the Rupee proceeds from such sale into foreign currency and the repatriation of that foreign currency from India
under certain circumstances could require the RBI’s approval. Approvals required from the RBI or any other
government authority may not be obtained on terms favourable to a non-resident investor or at all. Prior to the
repatriation of sale proceeds, certain filings must be made with an authorised dealer (bank) remitting the proceeds
along with certain documents, including an undertaking from the resident buyer in the prescribed form stating that the
pricing guidelines have been adhered to and a no objection/tax clearance certificate from the income tax authority or
a chartered accountant. If any approvals are required from the RBI or any other government authority, they may not
be obtained on terms favourable to a non-resident investor or at all. We cannot guarantee that any approval, if required,
will be obtained in a timely manner or at all. Due to possible delays in obtaining requisite approvals, investors in our
Equity Shares may be prevented from realising gains during periods of price increases or limiting losses during periods
of price declines.
9. A third party could be prevented from acquiring control over us because of anti-takeover provisions under
Indian law.
Indian law and regulations applicable to us may delay, deter or prevent a future takeover or change in control of us,
even if a change in control would result in the purchase of your Equity Shares at a premium to the market price or
would otherwise be beneficial to you. These provisions may discourage or prevent certain types of transactions
involving actual or threatened change in control of us. Under the Takeover Regulations, an acquirer has been defined
as any person who, directly or indirectly, acquires or agrees to acquire shares or voting rights or control over a
company, whether individually or acting in concert with others. Although these provisions have been formulated to
ensure that interests of investors/shareholders are protected, these provisions may also discourage a third party from
attempting to take control of us. Consequently, even if a potential takeover of us would result in the purchase of our
Equity Shares at a premium to their market price or would otherwise be beneficial to our stakeholders, it is possible
that such a takeover would not be attempted or consummated because of the Takeover Regulations. For further details,
please see section titled “The Securities Market of India” on page 184.
10. Our ability to borrow money in foreign markets may be constrained by Indian law, which may adversely affect
our business, financial condition, results of operations and cash flows.
As an Indian company, we are permitted to borrow in overseas markets subject to various conditions stipulated by the
regulators or Government of India. Such regulatory restrictions limit our financing sources and hence could constrain
our ability to obtain financing on competitive terms and refinance existing indebtedness. In addition, we cannot assure
you that the required approvals will be granted to us without onerous conditions, if at all. Limitations on raising foreign
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debt may have an adverse effect on our business, financial condition, results of operations and cash flows.
11. Differences exist between Ind AS and other accounting principles, such as IFRS and Indian GAAP, which
may be material to investors' assessments of our financial condition.
Our Company has prepared the annual financial statements under Ind AS for the Fiscal 2019 and 2020 as required
under Section 133 of the Companies Act, 2013. We have adopted Ind AS with effect from April 1, 2016. In doing so,
we were required to present comparative numbers for the previous Fiscal 2016, which were also prepared in
compliance with Ind AS. As such, the date of transition to Ind AS for us is April 1, 2015, being the opening balance
sheet of the comparative previous Fiscal. Given that Ind AS differs in many respects from Indian GAAP (previous
GAAP), our historical financial statements relating to any period prior to Fiscal 2016 may not be comparable to the
audited consolidated and standalone financial statements prepared under Ind AS.
Ind AS and other accounting standards like IFRS differ in certain respects including first time adoption choices
available. We have not attempted to quantify the impact of IFRS on the financial data included in this Letter of Offer,
nor do we provide a reconciliation of our financial statements to those of Ind AS with IFRS. Accordingly, the degree
to which the financial statements prepared under earlier Indian GAAP, Ind AS and other accounting principles, such
as IFRS, will provide meaningful information is entirely dependent on the reader's level of familiarity with these
standards. Any reliance by persons not familiar with Indian accounting practices on the financial disclosures presented
in this Letter of Offer should accordingly be limited.
12. Rights of shareholders under Indian law may be more limited than under the laws of other jurisdictions.
Our Articles, the instructions issued by the RBI and Indian law govern our corporate affairs. Legal principles relating
to these matters and the validity of corporate procedures, Directors’ fiduciary duties and liabilities, and shareholders’
rights may differ from those that would apply to a financial institution or corporate entity in another jurisdiction.
Shareholders’ rights under Indian law may not be as extensive as shareholders’ rights under the laws of other countries
or jurisdictions. Investors may have more difficulty in asserting their rights as one of our shareholders than as a
shareholder of a financial institution or corporate entity in other jurisdictions. For further details, please see section
titled “Description of the Equity Shares” on page 187.
C. Risks Relating to the Issue
1. We cannot guarantee that our Equity Shares issued pursuant to the Issue will be listed on the Stock Exchanges
in a timely manner, or at all.
In accordance with Indian law and practice, permission for listing and trading of our Equity Shares issued in the
offering will not be granted until after the Equity Shares have been issued and allotted. Approval for listing and trading
will require all relevant documents authorising the issuing of the Equity Shares to be submitted. There could be a
failure or delay in obtaining these approvals from the Stock Exchanges, which in turn could delay the listing of our
Equity Shares on the Stock Exchanges. Any failure or delay in obtaining these approvals would restrict an investor’s
ability to dispose of the Equity Shares.
2. Your ability to acquire and sell Equity Shares offered in the Issue is restricted by the distribution, solicitation
and transfer restrictions set forth in this Placement Document.
No actions have been taken to permit a public offering of the Equity Shares offered in the Issue in any jurisdiction. As
such, your ability to acquire Equity Shares offered in the Issue is restricted by the distribution and solicitation
restrictions set forth in this Placement Document. For further details, please see section titled “Selling Restrictions”
on page 174. Furthermore, the Equity Shares offered in the Issue are subject to restrictions on transferability and
resale. For further details, please see section titled “Transfer Restrictions” on page 182. You are required to inform
yourself about and observe these restrictions. Our representatives, our agents and us will not be obligated to recognise
any acquisition, transfer or resale of the Equity Shares offered in the Issue made other than in compliance with
applicable law.
3. An investor will not be able to sell any of the Equity Shares subscribed in this Issue other than on a recognised
Indian stock exchange for a period of 12 months from the date of the allotment of the Equity Shares.
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The Equity Shares subscribed for in this Allotment are subject to restrictions on transfers. Pursuant to the SEBI ICDR
Regulations, for a period of 12 months from the date of the Allotment in the Issue, QIBs subscribing to the Equity
Shares in the Allotment may only sell their Equity Shares on the Stock Exchanges and may not enter into any off-
market trading in respect of these equity shares. We cannot be certain that these restrictions will not have an impact
on the price of the Equity Shares. Further, allotments made to FPIs, FVCIs, VCFs and AIFs in the Allotment are
subject to the rules and regulations that are applicable to each of them, respectively, including in relation to lock-in
requirements. Specifically, investments by FVCIs are required to be made in compliance with Schedule 1 of FEMA.
This may affect the liquidity of the Equity Shares purchased by investors and it is uncertain whether these restrictions
will adversely impact the market price of the Equity Shares purchased by investors.
4. After this Issue, the price of our Equity Shares may be volatile.
The Issue Price was determined by us in consultation with the Book Running Lead Manager, based on Bids received
in compliance with Chapter VI of the SEBI ICDR Regulations, and it may not necessarily be indicative of the market
price of the Equity Shares after this Issue is completed.
The trading price of our Equity Shares may fluctuate after this Issue due to a variety of factors, including our results
of operations and the performance of our business, competitive conditions, general economic, political and social
factors, the performance of the Indian and global economy and significant developments in India’s Fiscal regime,
volatility in the Indian and global securities market, performance of our competitors, the Indian financial services
industry and the perception in the market about investments in the financial services industry, changes in the estimates
of our performance or recommendations by financial analysts and announcements by us or others regarding contracts,
acquisitions, strategic partnerships, joint ventures, or capital commitments. In addition, if the stock markets in general
experience a loss of investor confidence, the trading price of our Equity Shares could decline for reasons unrelated to
our business, financial condition or operating results. The trading price of our Equity Shares might also decline in
reaction to events that affect other companies in our industry even if these events do not directly affect us. Each of
these factors, among others, could adversely affect the price of our Equity Shares.
There can be no assurance that an active trading market for the Equity Shares will be sustained after this Issue, or that
the price at which the Equity Shares have historically traded will correspond to the price at which the Equity Shares
are offered in this Issue or the price at which the Equity Shares will trade in the market subsequent to this Issue.
5. Fluctuations in the exchange rate between the Rupee and other currencies could have an adverse effect on the
value of our Equity Shares in those currencies, independent of our operating results.
Our Equity Shares are quoted in Rupees on the Stock Exchanges. Any dividends in respect of our Equity Shares will
be paid in Rupees. Any adverse movement in currency exchange rates during the time it takes to undertake such
conversion may reduce the net dividend to investors. In addition, any adverse movement in currency exchange rates
during a delay in repatriating the proceeds from a sale of Equity Shares outside India, for example, because of a delay
in subsidiary approvals that may be required for the sale of equity shares, may reduce the net proceeds received by
investors. The exchange rate between the Rupee and other currencies (such as, the U.S. dollar, the Euro, the Pound
Sterling and the Singapore dollar) has changed substantially in the last two decades and could fluctuate substantially
in the future, which may have an adverse effect on the value of our Equity Shares and returns from our Equity Shares
in foreign currency terms, independent of our operating results.
6. Any future issuance of the Equity Shares by us or sales of the Equity Shares by any of our significant
shareholders may adversely affect the trading price of the Equity Shares. Further, holders of Equity Shares
could be restricted in their ability to exercise pre-emptive rights under Indian law and could thereby suffer
future dilution of their percentage ownership of the outstanding equity shares.
Under the Companies Act, a company incorporated in India must offer its holders of equity shares pre-emptive rights
to subscribe and pay for a proportionate number of shares to maintain their existing percentage ownership before the
issuance of any new equity shares, unless their pre-emptive rights have been waived by adoption of a special resolution
by holders of three-quarters of the shares who have voted on the resolution. However, if the law of the jurisdiction
that you are in does not permit the exercise of such pre-emptive rights without us filing an offering document or
registration statement with the applicable authority in such jurisdiction, you will be unable to exercise such pre-
emptive rights unless we make such a filing. We may elect not to file a registration statement in relation to pre-emptive
rights otherwise available by Indian law to you. To the extent that you are unable to exercise pre-emptive rights granted
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in respect of the Equity Shares, you may suffer future dilution of your ownership position and your proportional
interests in us would be reduced.
There is no restriction on our ability to issue Equity Shares or our major shareholders’ ability to dispose of their Equity
Shares, and we cannot assure you that we will not issue Equity Shares or that any major shareholder will not dispose
of, encumber, or pledge, its Equity Shares. Future issuances of Equity Shares may dilute your shareholding and may
adversely affect the trading price of our Equity Shares. Such securities may also be issued at prices below the then
current trading price of our Equity Shares. Sales of Equity Shares by our major shareholders may also adversely affect
the trading price of our Equity Shares.
7. Investors may be subject to Indian taxes arising out of capital gains on the sale of our Equity Shares.
Under current Indian tax laws and regulations, capital gains arising from the sale of the equity shares in an Indian
company are generally taxable in India. Any gain realized on the sale of listed Equity Shares on a stock exchange
which is subjected to securities transaction tax (“STT”) held for more than 12 months will be subject to capital gains
tax in India. STT will be levied on and collected by a domestic stock exchange on which the Rights Equity Shares are
sold. Any gain realized on the sale of the Rights Equity Shares held for more than 12 months to an Indian resident,
which are sold other than on a recognized stock exchange and on which no STT has been paid, will be subject to long-
term capital gains tax at higher rate with indexation benefits in India. Further, any gain realized on the sale of listed
Rights Equity Shares held for a period of 12 months or less which are sold other than on a recognized stock exchange
and on which no STT has been paid, will be subject to short term capital gains tax at a relatively higher rate as
compared to the transaction where STT has been paid in India.
Capital gains arising from the sale of the Rights Equity Shares will be exempt from taxation in India in cases where
the exemption is provided under a treaty between India and the country of which the seller is resident. Generally,
Indian tax treaties do not limit India’s ability to impose tax on capital gains. As a result, residents of other countries
may be liable for tax in India as well as in their own jurisdiction on a gain upon the sale of the Rights Equity Shares.
8. Foreign investors are subject to foreign investment restrictions under Indian law that limit our ability to attract
foreign investors, which may adversely impact the market price of the Equity Shares.
Under the foreign exchange regulations currently in force in India, transfers of the Equity Shares between non-
residents and residents are freely permitted (subject to certain exceptions) if they comply with the pricing guidelines
and reporting requirements specified by the RBI. If the transfer of the Equity Shares is not in compliance with such
pricing guidelines or reporting requirements and does not fall under any of the specified exceptions, then the prior
approval of the RBI will be required. Additionally, shareholders who seek to convert the Rupee proceeds from a sale
of the Equity Shares in India into foreign currency and repatriate that foreign currency from India will require a no-
objection or a tax clearance certificate from the income tax authority. We cannot assure you that any required approval
from the RBI or any other Government agency can be obtained on any particular terms or at all.
These foreign investment restrictions may adversely affect the liquidity and free transferability of the Equity Shares
and could result in an adverse effect on the price of the Equity Shares.
9. Investors will be subject to market risks until the Equity Shares credited to the investor’s demat account are
listed and permitted to trade.
Investors can start trading the Equity Shares allotted to them only after they have been credited to an investor’s demat
account, are listed and permitted to trade. Since the Equity Shares are currently traded on the Stock Exchanges,
investors will be subject to market risk from the date they pay for the Equity Shares to the date when trading approval
is granted for the same. Further, there can be no assurance that the Equity Shares allocated to an investor will be
credited to the investor’s demat account or that trading in the Equity Shares will commence in a timely manner.
65
MARKET PRICE INFORMATION
The Equity Shares have been listed and are available for trading on the BSE and the NSE. As on the date of this
Placement Document, 92,52,18,000 Equity Shares have been issued and are fully paid up.
On April 9, 2021, the closing price of the Equity Shares on the BSE and the NSE was Rs. 143.65 and Rs. 143.80 per
Equity Share, respectively. Since the Equity Shares are actively traded on the BSE and the NSE, the market price and
other information for each of the BSE and the NSE has been given separately.
(a) The following tables set forth the reported high, low and average market prices and the trading volumes of the
Equity Shares on the BSE and the NSE on the dates on which such high and low prices were recorded for Fiscal
2021, 2020 and Fiscal 2019:
BSE
Period
Face
value
(Rs.)
High
(Rs.)
Date
of high
Total
volume on
date of
high
(number
of Equity
Shares
traded on
the date of
high)
Total
volume
of
Equity
shares
traded
on the
date of
high
(Rs. in
lakhs)
Low
(Rs.)
Date of
low
Volume
on date
of low
(number
of Equity
Shares
traded on
the date
of low)
Total
volume
of
Equity
shares
traded
on the
on date
of low
(Rs. in
lakhs)
Average
price
for the
period*
(Rs.)
Total volume of
Equity Shares
traded in the
period
Total volume
of Equity
Shares
traded in the
period
In number (Rs. in lakhs)
Fiscal
2021 5 157.25
March
1, 2021 1,00,227
157.38 21.60
April 3,
2020 57,118 12.29 49.68 8,10,56,440 6,20,01.46
Fiscal
2020 5 50.25
April 15,
2019
1,78,722 89.81 18.65 March
24, 2020 1,67,719 32.28 38.26 3,59,47,724 1,40,43.98
Fiscal
2019 5 79.65
April 19,
2018
43,15,550 342.31 43.15 February
18, 2019 61,863 26.81 57.04 6,68,54,008 4,22,23.85
(Source: www.bseindia.com)
1. High, low and average prices are based on the daily closing prices.
2. In the case of a year, average represents the average of the closing prices of all trading days of each year presented.
3. In case of two days with the same closing price, the date with the higher volume has been considered.
NSE
Period
Face
value
(Rs.)
High
(Rs.)
Date
of high
Total
volume on
date of
high
(number of
Equity
Shares
traded on
the date of
high)
Total
volume of
Equity
shares
traded on
the date of
high
(Rs. in
lakhs)
Low
(Rs.)
Date of
low
Volume
on date
of low
(number
of
Equity
Shares
traded
on the
date of
low)
Total
volume
of
Equity
shares
traded
on the
on date
of low
(Rs. in
lakhs)
Average
price
for the
period*
(Rs.)
Total volume
of Equity
Shares traded
in the period
Total
volume of
Equity
Shares
traded in
the period
In number (Rs. in
lakhs)
Fiscal
2021 5 157.30
March
01, 2021
19,06,527 2,997.30
21.60 April 3,
2020 5,34,619 114.81
49.68
7,439,10,044
567476.69
Fiscal
2020 5 50.30
April
15 2019
9,35,588 470.22 18.65
March,
24 2020
7,88,013 152.00 38.27
25,43,61,008
101199.06
Fiscal 2019
5 79.80
April
19
2018
2,73,96,298 21,739.79 43.15
February
18,
2019
2,64,084 114.42 57.06 32,35,13,822 2,06,940
(Source: www.nseindia.com)
1. High, low and average prices are based on the daily closing prices.
2. In the case of a year, average represents the average of the closing prices of all trading days of each year presented 3. In case of two days with the same closing price, the date with the higher volume has been considered.
(b) The following tables set forth the reported high, low and average market prices and the trading volumes of the
66
Equity Shares on the BSE and NSE on the dates on which such high and low prices were recorded during each
of the last six months:
BSE
Month
Year
High
(Rs.)
Date of
High
Total
Volume
on date
of High
(Number
of
Equity
Shares
traded
on the
date of
high)
Total
Volume
of
Equity
shares
traded
on the
date of
high (Rs.
in lakhs)
Low
(Rs.)
Date of
low
Volume
on date
of Low
(Number
of
Equity
Shares
traded
on the
date of
low)
Total
volum
e of
Equity
shares
traded
on the
on
date of
low
(Rs. in
lakhs)
Avera
ge
price
for the
period
(Rs.)*
Total
volume of
Equity
Shares
traded in
the period
Total
volume
of
Equity
Shares
traded in
the
period
In number (Rs. in
lakhs)
March 2021 157.25 March
1,
2021
1,00,227 157.38
119.5 Mach
31,
2021
2,49,451 302.32
132.22
1,21,34,233
16667.40
February
2021 149.80
February 26,
2021
42,97,362 61,65.05 62.9 February
03,
2021
3,36,279 213.76 87.06
2,25,13,383
234,14.55
January
2021 67.55
January
08, 2021
4,59,267 3,11.62 54.75
January
25, 2021
3,52,201 194.04 61.89
91,10,870
57,75.84
December
2020 63.85
December
18, 2020
14,32,423 9,10.76 41.05
December
01, 2020
1,86,596 77.31 53.19
1,56,19,241
86,91.79
November 2020
41.45
November
27,
2020
4,58,411 1,87.47 32.5
November
02,
2020
55,674 18.22 36.05
26,30,364
9,93.07
October 2020
36.40
October
20,
2020
4,12,608 1,48.81 31.65
October
15,
2020
34,789 11.13
33.42
12,66,188
4,37.48
(Source:www.bseindia.com) 1. High, low and average prices are based on the daily closing prices.
2. In the case of a month, average represents the average of the closing prices of all trading days of each month presented 3. In case of two days with the same closing price, the date with the higher volume has been considered.
NSE
Month
Year
High
(Rs.)
Date of
High
Total
Volume on
date of High
(Number of
Equity
Shares
traded on
the date of
high)
Total
Volume of
Equity
shares
traded on
the date of
high (Rs.
in lakhs)
Low
(Rs.)
Date of
low
Volume
on
date of
Low
(Number
of Equity
Shares
traded on
the date of
low)
Total
volume
of
Equity
shares
traded
on the
on date
of low
(Rs. in
lakhs)
Average
price for
the
period
(Rs.)
Total
volume of
Equity
Shares
traded in
the period
Total
volume
of Equity
Shares
traded in
the
period
In number (Rs. in
lakhs)
March 2021 157.30
March
1,
2021
19,06,527 2,99.73
119.60
March
31,
2021
15,50,522
1,88.31
132.22
1,097,72,461
150581.15
February
2021 149.85
February 26,
2021
3,71,55,451 5,35,83.87 63.00 February
03,
2021
16,66,529 10,58.11 87.04 20,24,56,711 212520.14
January
2021 67.55
January
08, 2021
60,52,296 41,01.56 54.80
January
25, 2021
23,57,342 12,98.87 61.90 7,86,34,676 49958.76
December
2020 63.85
December
18, 2020
1,06,34,501 67,95.16 41.00
December
01, 2020
17,01,567 7,05.10 53.19 14,10,15,678 79373.69
November 41.45 November 42,31,434 17,36.72 32.40 November 2,62,026 85.68 36.07 3,02,54,578 11446.81
67
2020 27,
2020
02,
2020
October
2020 36.45
October
20,
2020
64,13,155 23,05.87 31.60
October
15,
2020
2,94,710 94.39 33.43 1,60,15,062 5569.71
(Source: www.nseindia.com)
1. High, low and average prices are based on the daily closing prices.
2. In the case of a month, average represents the average of the closing prices of all trading days of each month presented 3. In case of two days with the same closing price, the date with the higher volume has been considered.
(c) The following table sets forth the market price on the BSE and NSE on October 30, 2020, i.e., the first working
day following the approval of the Board of Directors for the Issue:
BSE NSE
Open High Low Close
Number of
Equity
Shares
traded
Turnover
(in Rs.
lakhs)
Open High Low Close
Number of
Equity Shares
traded
Turnover
(in Rs.
lakhs)
35.00 35.00 32.85 33.00 43,268 14.41 33.25 34.15 32.85 32.95 4,99,381 166.49 (Source: www.bseindia.com and www.nseindia.com)
68
USE OF PROCEEDS
The gross proceeds of the Issue will be approximately Rs. 50,000 lakhs. After deducting the Issue expenses including
fees and commission of approximately Rs. 457.13 lakhs, the net proceeds of the Issue will be approximately Rs.
49,542.87 lakhs (“Net Proceeds”). Subject to compliance with applicable laws and regulations, our Company intends
to use the net proceeds of the Issue towards partial funding of the phase-1 of our proposed capex/ expansion from 3.97
MTPA to 12.2 MTPA.
Our main objects clause and objects incidental or ancillary to the main objects clause of our Memorandum of
Association enables us to undertake the objects contemplated by us in this Issue.
The Net Proceeds are proposed to be utilised towards the following:
1. Enhancement of production of copper ore at Malanjkhand Copper Mine to 5.0 MTPA with change in
technology from the opencast mine to underground mine and expansion of beneficiation plant to 5.00 MTPA
including paste filing plant and allied facilities at Malanjkhand Copper Project;
2. Re-opening and expansion of the Kendadih mine at the Indian Copper Complex to produce approximately 0.45
MTPA of copper ore;
3. Expansion of the Surda mine at Indian Copper Complex to produce approximately 0.90 MTPA of copper ore
and allied facilities;
4. Expansion of the Khetri Copper Mine at Khetri Copper Complex by deepening of shafts to produce
approximately 1.5 MTPA of copper ore and allied facilities; and
5. Development of Banwas deposit at Khetri Copper Complex to produce approximately 0.6 MTPA of copper
ore.
Our company has awarded EPC contracts to third parties to undertake each of the abovementioned capex/ expansions.
Set out below are the details of the proposed capex / expansion projects proposed to be funded from the Net Proceeds,
including the break-up of the costs of the proposed capex/ expansion, amount already deployed by the Company
towards such proposed capex/expansion and the proposed deployment from the Net Proceeds towards the proposed
capex/ expansion: (₹ in lakhs)
Particulars Total
Estimated
Cost of the
Project*
Amount already
deployed as on
December 31,
2020#
Amount
which will be
financed
from Net
Proceeds(1)
Estimated
Utilisation of Net
Proceeds(1)
Fiscal 2022
Enhancement of production of copper ore at
Malanjkhand Copper Mine to 5.0 MTPA with
change in technology from the opencast mine to
underground mine and expansion of beneficiation
plant to 5.00 MTPA including paste filing plant &
allied facilities at Malanjkhand Copper Project
185,600.00
48,956.00 49,542.87 49,542.87
Re-opening and expansion of the Kendadih mine at
the Indian Copper Complex to produce
approximately 0.45 MTPA of copper ore
9,400.00 6,686.00
Expansion of the Surda mine at Indian Copper
Complex to produce approximately 0.90 MTPA of
copper ore and allied facilities
21,900.00 3,886.00
Expansion of the Khetri Copper Complex by
deepening of shafts to produce approximately 1.5
MTPA of copper ore and allied facilities
44,300.00 1,337.00
Development of Banwas deposit at KCC to produce
0.6 MTPA of copper ore
9,000.00 4,610.00
*Estimated costs have been derived from the EPC contracts awarded by our Company to the third parties for the
expansion activities and management estimates for unawarded contracts and do not include any escalation costs.
69
# An amount of Rs. 19,426.00 lakhs has been spent towards variation due to change in scope of work and escalation
costs as per the EPC contracts. (1)Subject to the finalisation of the Issue Price and Net Proceeds. To be updated in the Placement Document
Our management will have the flexibility to deploy the Net Proceeds towards any or all of the abovementioned projects
in the manner they deem fit, in terms of the approval dated August 1, 2018 from the Cabinet Committee on Economic
Affairs. Given the dynamic nature of our business, we may have to revise our funding requirements and deployment
on account of a variety of factors such as our financial condition, escalation costs as set out in the EPC contracts,
business strategy and external factors such as market conditions including the COVID-19 pandemic, competitive
environment and interest or exchange rate fluctuations, changes in design and configuration of the project, increase in
input costs of construction materials and labour costs, logistics and transport costs, incremental preoperative expenses,
taxes and duties, interest and finance charges, engineering procurement and construction costs, working capital
margin, regulatory costs, environmental factors and other external factors which may not be within the control of our
management. This may entail rescheduling or revising the planned expenditure and funding requirements, including
the expenditure for a particular purpose, at the discretion of our management, subject to compliance with applicable
law. In case of a shortfall in raising requisite capital from the Net Proceeds or an increase in the total estimated cost
of the Objects, business considerations may require us to explore a range of options including utilising our internal
accruals and seeking additional debt from existing and future lenders. We believe that such alternate arrangements
would be available to fund any such shortfalls. Further, in case of variations in the actual utilization of funds earmarked
for the purposes set forth above, increased fund requirements for a particular purpose may be financed by surplus
funds, if any, available in respect of the other purposes for which funds are being raised in the Issue. To the extent our
Company is unable to utilise any portion of the Net Proceeds towards the aforementioned objects, per the estimated
scheduled of deployment specified above, our Company shall deploy the Net Proceeds in subsequent Fiscals towards
the aforementioned Objects.
Means of finance
The total estimated cost for the capex/ expansion of the abovementioned projects is approximately Rs. 270,200.00
lakhs. We intend to fund the abovementioned capex/ expansion projects as follows: (Rs. in lakhs)
Particulars Amount
Total estimated project cost (A) 270,200.00
Amount deployed as of December 31, 2020* (B) 65,475.00
Balance amount to be incurred (C) = (A-B) 204,725.00
Amount to be funded by infusion of Net Proceeds (D) 49,542.87
Funding required excluding the Net Proceeds (E) = (C– D) 1,55,182.13
*An amount of Rs. 19,426.00 lakhs has been spent towards variation due to change in scope of work and escalation
costs as per the EPC contracts.
We intend to fund the balance amount required to be spent toward the capex/ expansion by way of internal accruals
and debts (including loans and bonds). The amounts and timing of any expenditure will depend on, among other
factors, the amount of cash generated by our operations, competitive and market developments and the availability of
acquisition or investment opportunities on terms acceptable to us. In accordance with the decision of our Board, our
management will have significant flexibility in applying the Net Proceeds of this Issue towards any or all of the
abovementioned projects in the manner they deem fit, in terms of the approval dated August 1, 2018 from the Cabinet
Committee on Economic Affairs.
Interim Use of Net Proceeds
Pending utilisation for the purposes described above, we intend to temporarily invest Net Proceeds in creditworthy
instruments, including money market, debt mutual funds, deposits with banks and inter corporate loans. Such
investments would be in accordance with the investment policies as approved by the Board from time to time and all
applicable laws and regulations.
In accordance with applicable laws, we undertake to not utilize proceeds from the Issue unless Allotment is made and
the corresponding return of Allotment is filed with the RoC, and the final listing and trading approvals are received
from each of the Stock Exchanges.
70
Other confirmations
None of our Directors are making any contribution either as part of this Issue or separately in furtherance of the objects
of this Issue.
None of our Directors or Key Management Personnel are interested in the Issue and neither of them will receive any
proceeds from the Issue.
71
CAPITALISATION STATEMENT AND FINANCIAL INDEBTEDNESS
The following table sets forth our Company’s capitalisation statement on an unconsolidated basis as of December 31,
2020 based on the Condensed Interim Unconsolidated Financial Statements and as adjusted to give effect to the receipt
of the gross proceeds of the Issue.
This capitalisation table should be read together with “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” and “Financial Statements” on pages 77 and 204, respectively and the related notes
include elsewhere in this Placement Document.
(in ₹ lakhs)
Particulars As at December 31, 2020 As adjusted for the Issue^
Short term borrowings1:
Secured borrowings 4,000.48 4,000.48
Unsecured borrowings 14,550.00 14,550.00
Long term borrowings1:
Secured borrowings (including current
portion)
1,00,491.36 1,00,491.36
Unsecured borrowings 8,000.00 8,000.00
Total indebtedness (A) 1,27,041.84 1,27,041.84
Shareholders’ funds:
Share capital 46,260.90 48,351.20
Reserves and surplus2 5,158.49 53,068.19
Total Shareholders’ funds (B) 51,419.39 1,01,419.39
Total capitalization (A+B) 1,78,461.23 2,28,461.23
Debt / Equity ratio (A/B) 2.47 1.25
Long term borrowing / Equity Ratio 2.11 1.07 1 Excluding accrual interest. 2 Created out of profit less mines development expenditure.
^ As adjusted to reflect the number of Equity Shares issued pursuant to the Issue. The column reflects the changes in equity only
on account of the gross proceeds from the fresh issue of 4,18,06,020 Equity Shares at a price of ₹ 119.60 per Equity Share, including
a premium of ₹ 114.60 per Equity Share, resulting an increase of ₹ 2,090.30 lakh in the equity share capital of our Company and
an increase of ₹ 47,909.70 lakh in Reserves and surplus. The adjustments do not include Issue-related expenses. Further, it does
not consider any other adjustments or movements or any such line items in our financial statements, post December 31, 2020
72
CAPITAL STRUCTURE
The share capital of our Company as on the date of this Placement Document is set forth below:
(in Rs. except share data)
Aggregate value at face value
(except Securities Premium
Account)
A AUTHORISED SHARE CAPITAL
1,80,00,00,000 Equity Shares of Rs. 5 each 9,00,00,00,000
20,00,000 7.5% non-cumulative redeemable preference shares of Rs.
1000 each
2,00,00,00,000
B ISSUED, SUBSCRIBED AND PAID-UP EQUITY SHARE
CAPITAL BEFORE THE ISSUE
92,52,18,000 Equity Shares of Rs. 5 each 4,62,60,90,000
C PRESENT ISSUE IN TERMS OF THIS PLACEMENT
DOCUMENT (1)
4,18,06,020 Equity Shares of Rs. 5 each aggregating up to Rs. 50,000
lakhs
20,90,30,100
D PAID-UP CAPITAL AFTER THE ISSUE
96,70,24,020 Equity Shares of Rs. 5 each 4,83,51,20,100
E SECURITIES PREMIUM ACCOUNT
Before the Issue Nil
After the Issue 4,79,09,69,892 (1) This Issue has been authorized by the Board of Directors on October 29, 2020 and the relevant intimation in compliance with
Regulation 29(1) of the SEBI Listing Regulations to the Stock Exchanges was made on October 21, 2020 and by the shareholders
of our Company pursuant to a special resolution by way of a postal ballot dated January 28, 2021 and the relevant intimation
under the provisions of the Companies Act, 2013 and the SEBI Listing Regulations to the Stock Exchanges was made on January
29, 2021.
Equity Share capital history of our Company
The history of the equity share capital our Company since incorporation is provided in the following table:
Date of allotment Face value (Rs.)
Issue
price
(Rs.)
Nature of
allotment
Nature of
consideration
Number of
equity shares
issued
Cumulative
number of
equity shares
November 9, 1967 1,000 1,000 Subscription
to the MoA of
our Company
Cash 3 3
April 10, 1968 1,000 1,000 Further issue* Cash 98 101
May 30, 1968 1,000 1,000 Further issue* Cash 13,500 13,601
August 10, 1968 1,000 1,000 Further issue* Cash 13,170 26,771
November 15, 1968 1,000 1,000 Further issue* Cash 9,000 35,771
December 30, 1968 1,000 1,000 Further issue* Cash 9,800 45,571
March 1, 1969 1,000 1,000 Further issue* Cash 10,200 55,771
April 28, 1969 1,000 1,000 Further issue* Cash 5,230 61,001
August 2, 1969 1,000 1,000 Further issue* Cash 24,800 85,801
November 7, 1969 1,000 1,000 Further issue* Cash 21,500 1,07,301
February 12, 1970 1,000 1,000 Further issue* Cash 26,900 1,34,201
April 28, 1970 1,000 1,000 Further issue* Cash 11,800 1,46,001
July 14, 1970 1,000 1,000 Further issue* Cash 19,600 1,65,601
September 25, 1970 1,000 1,000 Further issue* Cash 25,600 1,91,201
January 2, 1971 1,000 1,000 Further issue* Cash 12,100 2,03,301
March 1, 1971 1,000 1,000 Further issue* Cash 13,700 2,17,001
March 22, 1971 1,000 1,000 Further issue* Cash 40,000 2,57,001
73
Date of allotment Face value (Rs.)
Issue
price
(Rs.)
Nature of
allotment
Nature of
consideration
Number of
equity shares
issued
Cumulative
number of
equity shares
1971** 1,000 1,000 Further issue* Cash 15,000 2,72,001
May 27, 1971 1,000 1,000 Further issue* Cash 15,000 2,87,001
July 29, 1971 1,000 1,000 Further issue* Cash 24,600 3,11,601
August 28, 1971 1,000 1,000 Further issue* Cash 20,000 3,31,601
November 19, 1971 1,000 1,000 Further issue* Cash 58,777 3,90,378
January 21, 1972 1,000 1,000 Further issue* Cash 20,000 4,10,378
March 29, 1972 1,000 1,000 Further issue* Cash 50,823 4,61,201
January 3, 1973 1,000 N.A. Further issue* Other than
cash#
1,02,443 5,63,644
July 7, 1973 1,000 1,000 Further issue* Cash 56,100 6,19,744
September 8, 1973 1,000 1,000 Further issue* Cash 18,700 6,38,444
March 25, 1974 1,000 N.A. Further issue* Other than
cash##
75,000 7,13,444
October 26, 1974 1,000 1,000 Further issue* Cash 900 7,14,344
August 23, 1975 1,000 1,000 Further issue* Cash 800 7,15,144
March 29, 1976 1,000 1,000 Further issue* Cash 707 7,15,851
May 12, 1976 1,000 1,000 Further issue* Cash 23,500 7,39,351
August 31, 1976 1,000 1,000 Further issue* Cash 37,179 7,76,530
January 3, 1977 1,000 1,000 Further issue* Cash 20,000 7,96,530
February 14, 1977 1,000 1,000 Further issue* Cash 276 7,96,806
March 15, 1977 1,000 1,000 Further issue* Cash 224 7,97,030
August 8, 1977 1,000 1,000 Further issue* Cash 30,000 8,27,030
November 29, 1977 1,000 1,000 Further issue* Cash 30,000 8,57,030
March 17, 1978 1,000 1,000 Further issue* Cash 1,050 8,58,080
May 26, 1978 1,000 1,000 Further issue* Cash 14,300 8,72,380
August 7, 1978 1,000 1,000 Further issue* Cash 28,700 9,01,080
December 4, 1978 1,000 1,000 Further issue* Cash 52,900 9,53,980
February 14, 1979 1,000 1,000 Further issue* Cash 20,000 9,73,980
April 21, 1979 1,000 1,000 Further issue* Cash 25,750 9,99,730
June 21, 1979 1,000 1,000 Further issue* Cash 48,800 10,48,530
August 29, 1979 1,000 1,000 Further issue* Cash 30,000 10,78,530
December 1, 1979 1,000 1,000 Further issue* Cash 40,000 11,18,530
January 25, 1980 1,000 1,000 Further issue* Cash 25,600 11,44,130
March 31, 1980 1,000 1,000 Further issue* Cash 1,04,400 12,48,530
June 23, 1980 1,000 1,000 Further issue* Cash 69,850 13,18,380
November 1, 1980 1,000 1,000 Further issue* Cash 1,20,000 14,38,380
June 9, 1981 1,000 1,000 Further issue* Cash 61,600 14,99,980
July 8, 1982 1,000 1,000 Further issue* Cash 1,99,800 16,99,780
March 19, 1983 1,000 1,000 Further issue* Cash 40,000 17,39,780
March 29, 1983 1,000 1,000 Further issue* Cash 1,13,000 18,52,780
December 6, 1983 1,000 1,000 Further issue* Cash 75,000 19,27,780
August 10, 1984 1,000 1,000 Further issue* Cash 72,220 20,00,000
February 2, 1985 1,000 1,000 Further issue* Cash 1,96,880 21,96,880
March 21, 1986 1,000 1,000 Further issue* Cash 8,350 22,05,230
June 12, 1986 1,000 1,000 Further issue* Cash 8,350 22,13,580
December 18, 1986 1,000 1,000 Further issue* Cash 50,000 22,63,580
June 26, 1987 1,000 1,000 Further issue* Cash 5,400 22,68,980
September 14, 1987 1,000 1,000 Further issue* Cash 80,000 23,48,980
November 9, 1987 1,000 1,000 Further issue* Cash 50,000 23,98,980
March 29, 1988 1,000 1,000 Further issue* Cash 50,000 24,48,980
April 7, 1989 1,000 1,000 Further issue* Cash 2,07,900 26,56,880
June 1, 1989 1,000 1,000 Further issue* Cash 40,000 26,96,880
April 9, 1990 1,000 1,000 Further issue* Cash 2,50,500 29,47,380
January 30, 1991 1,000 1,000 Further issue* Cash 94,600 30,41,980
The face value of the Equity Shares of our Company was reduced from Rs. 1,000 per equity share to Rs. 10 per Equity Share
pursuant to a resolution passed by the Shareholders of our Company at an EGM held on December 4, 1992 and each equity
share of face value Rs. 1,000 each was split into 100 equity shares of face value Rs. 10 each
December 28, 1993 10 10 Further issue* Cash 10,00,000 30,51,98,000
74
Date of allotment Face value (Rs.)
Issue
price
(Rs.)
Nature of
allotment
Nature of
consideration
Number of
equity shares
issued
Cumulative
number of
equity shares
January 10, 2000 10 10 Preferential
allotment1
Cash 4,56,80,000 35,08,78,000
January 24, 2001 10 10 Preferential
allotment2
Cash 1,20,00,000 36,28,78,000
January 7, 2005 10 10 Preferential
allotment3
Cash 36,53,40,000 72,82,18,000
November 29, 2006 10 10 Preferential
allotment4
Cash 4,00,00,000 76,82,18,000
The face value of the Equity Shares of our Company was reduced from Rs. 10 per equity share to Rs. 5 per Equity Share pursuant
to a resolution under Section 100 of the Companies Act passed by the Shareholders of our Company at an EGM held on August
16, 2007. This was pursuant to a scheme under Section 101 of the Companies Act.
September 10, 2008 5 5 Preferential
allotment5
Cash 15,70,00,000 92,52,18,000
* Allotment of Equity Shares to the Promoter against funds released by the GoI.
# Allotment pursuant to a tripartite agreement between the National Mineral Development Corporation Limited, GoI and our
Company in relation to the acquisition of assets and liabilities of KCC from National Mineral Development Corporation Limited.
## Allotment pursuant to the acquisition of the Indian Copper Corporation Limited pursuant to the Indian Copper Corporation
(Acquisition of Undertaking) Act, 1972 and Indian Copper Corporation (Taking Over of Management) Act, 1972 at Jharkhand.
1 SEBI by its letter (No. PMD/AK/18362/99) dated September 23, 1999 exempted our Company from the applicability of the
erstwhile SEBI (Disclosure and Investor Protection) Guidelines, 2000.
2 SEBI by its letter (No. PMD/AS/11539/2000) dated July 20, 2000 exempted our Company from the applicability of the erstwhile
SEBI (Disclosure and Investor Protection) Guidelines, 2000.
3 SEBI by its letter (No. CFD/DIL/EB/27331/2004) dated December 6, 2004 exempted our Company from the applicability of the
erstwhile SEBI (Disclosure and Investor Protection) Guidelines, 2000.
4 SEBI by its letter (No. CFD/DIL/EB/63595/2006) dated March 28, 2006 exempted our Company from the applicability of the
erstwhile SEBI (Disclosure and Investor Protection) Guidelines, 2000.
5 SEBI by its letters (No. CFD/DIL/EB/92101/2007 and No. CFD/DIL/EB/04727/2007) dated April 26, 2007 and September 26,
2007, respectively, exempted our Company from the applicability of the erstwhile SEBI (Disclosure and Investor Protection)
Guidelines, 2000.
Pre-Issue and post-Issue shareholding pattern of Company
The pre-Issue and post-Issue shareholding pattern of our Company is set forth below:
# Category
Pre-Issue as of April 9, 2021* Post-Issue as of #
No. of Equity Shares held
% of share
holding
No. of Equity
Shares held
% of share
Holding
A. Promoters’ holding
1. Indian
Individual NIL NIL NIL NIL
Body Corporates NIL NIL NIL NIL
Central Government/State
Government(s)
PRESIDENT OF INDIA 70,35,87,852 76.05 70,35,87,852 72.76
Sub-total 70,35,87,852 76.05 70,35,87,852 72.76
2. Foreign Promoters NIL NIL NIL NIL
Sub-total (A) 70,35,87,852 76.05 70,35,87,852 72.76
B. Non-Promoter Holding
1. Institutional Investors 12,17,58,697 13.16 16,35,64,717 16.91
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# Category
Pre-Issue as of April 9, 2021* Post-Issue as of #
No. of Equity Shares held
% of share
holding
No. of Equity
Shares held
% of share
Holding
2. Non-Institutional Investors
Body Corporates 1,25,73,368 1.36 1,25,73,368 1.30
Directors NIL NIL
Indian public 8,43,41,374 9.12 8,43,41,374 8.72
Others including Non resident
Indians (NRIs)
29,56,709 0.32 29,56,709
0.31
3. Non Promoter Non-public NIL NIL NIL NIL
Sub-total (B) 22,16,30,148 23.95 26,34,36,168 27.24
Grand Total (A+B) 92,52,18,000 100.00 96,70,24,020 100.00
*This shareholding data is based on the beneficiary position data of our Company as of April 9, 2021
#The post-Issue shareholding pattern of our Company reflects the shareholding of the institutional investors category
on the basis of the Allocation made in the Issue, and reflects the shareholding of all other categories as of April 9,
2021.
Our Company has not issued any Equity Shares in the last one year preceding the date of filing of this Placement
Document.
Our Company does not have any outstanding preference shares.
Our Company does not have any employee stock options plan.
76
DIVIDENDS
In accordance with the provisions of the Companies Act, 2013, dividend shall be paid out of (a) relevant Fiscal’s
profit, after providing for depreciation in accordance with the provisions of the applicable law; or (b) net profit from
any previous Fiscal(s), after providing for depreciation and remaining undistributed; or (c) out of (a) and (b) mentioned
above.
The Department of Investment and Public Asset Management by an Office Memorandum (F. No. 5/2/2016-Policy),
dated May 27, 2016, issued “Guidelines on Capital Restructuring of Central Public Sector Enterprises” (“CPSE
Capital Restructuring Guidelines”). As per CPSE Capital Restructuring Guidelines, all central public sector
enterprises are required to pay a minimum annual dividend of 30% of profit after tax or 5% of the net-worth, whichever
is higher, subject to the maximum dividend permitted under the extant legal provisions.
Our Company has adopted a dividend policy at its meeting held on December 13, 2016. However, the declaration and
payment of dividends on our Equity Shares will be recommended by our Board and approved by our shareholders, at
their discretion, in accordance with the provisions of the Articles and the Companies Act. Further, the dividends, if
any, will depend on a number of factors, including but not limited to our earnings, guidelines issued by the Department
of Public Enterprise (“DPE”), capital requirements and overall financial position of our Company. In addition, our
ability to pay dividends may be impacted by a number of factors, including the results of operations, financial
condition, contractual restrictions, and restrictive covenants under the loan or financing arrangements we may enter
into. Our Company may also, from time to time, pay interim dividends.
The following table details the dividend declared by our Company on the Equity Shares for the Fiscals 2020, 2019
and 2018 and the nine month period ended December 31, 2020:
(in Rs. lakhs other than rate of dividend and dividend per Equity Share)
Particulars
Nine month period
ended December 31,
2020
Fiscal 2020 Fiscal 2019
Fiscal 2018
Total dividend declared Nil Nil 4,811.14 2,313.05
Dividend distribution tax Nil Nil 988.94 475.45
Equity Share capital 46,260.90 46,260.90 46,260.90 46,260.90
Rate of dividend (in %)* Nil Nil 10.40% 5%
Dividend per Equity Share
(in Rs.)
Nil Nil 0.52 0.25
*Rate as a percentage of the face value of the Equity Shares. Face value of each Equity Share is Rs. 5.
Further, the amounts paid as dividends in the past are not necessarily indicative of our dividend distribution policy or
dividend amounts, if any, in the future. There is no guarantee that any dividends will be declared or paid or that amount
thereof will not be decreased in the future.
For a summary of certain Indian tax consequences of dividend distributions to shareholders, please see section titled
“Statement of Tax Benefits” beginning on page 191.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
You should read the following discussion of our financial condition and results of operations together with our Audited
Financial Statements as at and for the Fiscals ended March 31, 2020, 2019 and 2018 and the Condensed Interim
Unaudited Financial Statements as at and for the nine month period ended December 31, 2020 including the schedules
and notes thereto and report thereon included elsewhere in this Placement Document.
Our Audited Financial Statements are prepared in accordance with Indian Accounting Standards (“Ind AS”). This
discussion contains forward-looking statements and reflects our current views with respect to future events and
financial performance. Actual results may differ materially from those anticipated in these forward-looking
statements. You should also read the section titled “Risk Factors” on page 40, which discusses a number of factors
and contingencies that could impact our financial condition and results of operations.
Our Fiscal ends on March 31 of each year. Accordingly, all references to a particular Fiscal are to the 12 month
period ended March 31 of that year.
This discussion contains certain forward-looking statements and reflects our current assessment of potential events
in the future, and our future financial performance. Actual results may differ materially from those anticipated in
these forward looking statements as a result of certain factors such as those set forth in the sections titled “Risk
Factors”, “Forward Looking Statements”, “Our Business” on pages 40, 14 and 124, respectively and elsewhere in
this Placement Document. Given these uncertainties, prospective investors are cautioned not to place undue reliance
on such forward looking statements.
Overview
We are the only operating copper ore producing mining company in India. We are also the only vertically integrated
producer of refined copper in India (Source: Annual Report (2019-20), Ministry of Mines, Government of India). We
have access to around two-fifths of India’s copper ore reserves and resources as on April 1, 2020. Our Company is
central public sector undertaking under the Ministry of Mines, Government of India. Our Company was conferred
Miniratna- Category I status by the Government of India in 2008.
Our principal activities include: (a) mining of copper ore; (b) beneficiation of copper ore into copper concentrate; and
(c) smelting, refining and extruding of the refined copper in downstream saleable products. We sell copper concentrate,
copper cathode and continuous cast wire rods. In addition, we sell by-products generated through the copper
manufacturing process including anode slime containing gold and silver and sulphuric acid.
Our principal operations include three copper ore mining complexes – the Malanjkhand Copper Project (“MCP”) at
Malanjkhand in Balaghat district, Madhya Pradesh, the Khetri Copper Complex (“KCC”) at Khetrinagar in Jhunjhunu
district, Rajasthan and the Indian Copper Complex (“ICC”)at Ghatsila in East Singhbhum district, Jharkhand – each
of which consists of one or more copper ore mines and their own beneficiation plants. Further, our ICC complex also
has its own smelting and refining facilities with a production capacity of cathode of 18,500 MT/annum. Additionally,
we have a continuous cast copper wire rod plant at Taloja in Raigad district, Maharashtra with a production capacity
of 60,000 MT/annum. We also have a secondary smelter and refinery plant at our Gujarat Copper Project (“GCP”) at
Jhagadia in Bharuch district, Gujarat with a production capacity of 50,000 MT/annum.
As on April 1, 2020, we had access to around two-fifths of the copper ore reserves and resources in India with an
average grade 1.01%. Further, as on April 1, 2020, we had reserves (proved & probable) of 167.08 million tonne ore
(average grade 1.32%) and total reserves and resource of 570.40 million tonne ore (average grade 1.01%).
Certain Factors Affecting Our Results of Operations
Our results of operations are affected by the following factors:
• LME Price for Copper and TcRc Charges: The prices we sell our copper concentrate at and the prices we charge
for our copper products are based on the LME price for copper. The average selling price of our copper
concentrate, as presented in copper metal-in-concentrate, was Rs. 4.01 lakh per tonne for Fiscal 2020 and Rs. 4.15
78
lakh per tonne for Fiscal 2019. The average selling price of our refined copper products was approximately Rs.
4.46 lakh per tonne for Fiscal 2020 and Rs. 4.64 lakh per tonne for Fiscal 2019.
We sell our copper concentrate based on the LME prices minus the prevailing TcRc charges. We sell our refined
copper products at a premium to LME price for the relevant quotation period, which is affected by global demand
and supply of refined copper and prevailing freight costs. We price refined copper at the landed cost of imported
metal that reflects LME, regional premiums, import duties and current exchange rates. LME copper prices have
been volatile in the past. Sharp declines in the LME copper price have caused us to suspend mining, smelting and
refining operations in the past and were largely responsible or us undergoing government restructuring in the past.
Consequently, our revenue and results of operation have been and will continue to be subject to the effects of
fluctuations in the LME copper prices. We expect this volatility for the LME copper prices to continue to affect
our profitability.
• Production volume/Sales volume: We generate most of our revenue by (i) mining and selling copper concentrate
to our customers; and (ii) refining our copper concentrate into refined copper products and selling the refined
copper products. We produced 39.68 lakh tonnes of Copper Ore in Fiscal 2020 and produced 41.22 lakh tonnes
of Copper Ore in Fiscal 2019 which has been the highest in the past 21 years for our Company. We produced
26502 tonnes and 32,439 tonnes of metal in concentrate in Fiscal 2020 and 2019, respectively and sold 12669
tonnes and 21,953 tonnes of metal in concentrate in Fiscal 2020 and Fiscal 2019, respectively. We produced 5340
tonnes and 16,215 tonnes of Cathode (including toll smelted cathode) in Fiscal 2020 and Fiscal 2019, respectively
and sold 1492 tonnes and 2,564 tonnes of Cathode (including toll smelted cathode) in Fiscal 2020 and Fiscal
2019, respectively. We further produced 4108 tonnes and 13,866 tonnes of wire rod in Fiscal 2020 and Fiscal
2019, respectively and sold 4247 tonnes and 13,756 tonnes of wire rod in Fiscal 2020 and Fiscal 2019,
respectively.
With the large imbalance between copper concentrate production in India and the refining capacity within India,
we believe that our copper concentrate sales volume will be largely dependent upon our production capacity. We
plan to expand from our current production level of approximately 3.97 MTPA as of March 31, 2020 to an
expected mining capacity of at least 12.2 MTPA in Phase-I and 20.2 MTPA in Phase-II.
• Production Cost/Cost of Sales: An important factor that affects our profitability is our production costs/cost of
sales. Our cost of sales is comprised of our materials spares and components, employees’ remuneration and
benefits, other expenses of manufacturing, administration, selling and distribution, mining royalties and
amortization of mine development expenditures.
Our average total cost of product sold per tonne for copper metal-in-concentrate was Rs. 3.32 lakhs, Rs. 2.61
lakhs and Rs. 2.27 lakhs, for the for Fiscal 2020, 2019 and 2018, respectively. The key factors impacting our
production costs for copper concentrate include variations in production volume, and the cost of power, fuel and
labour. The key factors impacting our production costs for refined copper products include variations in
production volume, and the cost of power, fuel and labour.
• Duties and Taxes: Our operations in India are subject to various applicable duties, incentives, royalties and taxes
and as a result, are significantly affected by changes in import duties, export incentives and taxes. The pricing of
copper concentrate as well as refined copper products in India are determined with reference to landed cost of
imports and customs duties would influence our average selling prices and hence our profitability.
• Import Duties: The import of refined copper products in India currently attracts a basic duty of 5%. The customs
duty on imported refined copper products was reduced in stages from 35% in 2002 to the current level of 5%.
The basic import duty on copper concentrate was also brought down from 5% in 2002 to the current level of 2.5%
effective March 1, 2011. Imports in India also attract an additional surcharge of 10% of the applicable duties.
Though the import duty rates have been reduced substantially over the years, the Government of India may reduce
import duties even further and the timing and extent of such reductions cannot be predicted. Any such reduction
will have a direct impact on domestic pricing and profitability of our operations.
• Taxes and Royalties: Our results of operations are affected by the income tax we pay on our profits and, to a
lesser extent, on dividend distributions. Income tax on Indian companies is currently charged at a statutory rate
of 25.168%, including a surcharge of 10% and health & education cess of 4% and higher education cess of nil%.
The Indian corporate tax rate and surcharges thereon were 34.944% including basic rate of 30%, surcharge of
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12% and Health & Education cess 4%, for Fiscal 2020. In fiscal 2019 & 2018 the total rate was 34.608%
consisting of basic rate of 30%, surcharge of 12% and Education cess 2% & secondary higher education cess of
1% . We are also subject to other government royalties and taxes. We pay royalties on the copper ore we mine to
the respective local State Government based upon volume of production in the particular State. The Government
of India can change the amount of the royalty, but cannot do so more than once every three years. Presently, we
pay a royalty of 4.62% and in addition DMF of 30% of royalty and 2% NMET on royalty of the value of the
metal contained in the ore mined, based on LME prices.
• Capacity Expansion: One of our key strategies is to expand our copper mining capacity. We are in the process
of expanding our mining capacities from approximately 3.97 MTPA as on March 31, 2020 to 12.2 MTPA in
phase –I (under implementation) and subsequently to 20.2 million tons per annum in phase-II This expansion plan
includes (i) development of underground mine under existing open cast mine at Malanjkhand; (ii) expanding our
existing mines, namely Khetri, Kolihan and Surda; (iii) reopening some of our mines that were closed in the past
namely Kendadih and Rakha; and (iv) establishing new mines/mining blocks, namely Banwas, Chapri, Sideshwar
and Dhobani mine. Upon completion of these expansion projects, we expect that copper concentrate, rather than
refined copper products, will be our primary product. Accordingly, we expect to derive our revenue primarily
from the sale of copper concentrate. After the completion of our expansion plans, we expect to benefit from
increased economies of scale and improved efficiency, which will have a positive impact on our gross margins.
However, these expansions are also expected to increase our depreciation and mine development expenditure
amortization expenses and may also increase our interest expense should we need to finance these expansion
initiatives with debt. The completion dates for these expansion projects are estimates and may be subject to delay
as a result of a number of factors, many of which are out of our control. See “Risk Factors” on page 40.
• Significant Dependence on a single customer- In Fiscal 2020, we sold all of our surplus copper concentrate to
primarily one of these major refined copper producers in India. Through the planned expansion of our mining
capacities, we expect that copper concentrate, rather than refined copper products, will be our primary product in
the future. We expect that we will continue to sell most or all of our copper concentrate to this large refined copper
producer in India, where our cost advantages are most prominent. A significant downturn in the business or
financial condition of this customer could adversely affect our results of operations. If our relationship with this
customer deteriorates or is terminated in the future, we may be required to seek new customers within or outside
India. In the event that we are required to sell our copper concentrate to international refined copper producers,
our cost advantages would be less pronounced and our results of operations and financial condition could be
adversely affected.
Critical Accounting Policies
Basis of Accounting
The financial statements are prepared under historical cost convention from the books of accounts maintained under
accrual basis except for certain financial instruments which are measured at fair value and in accordance with the
Indian Accounting Standards prescribed under Companies Act, 2013.
Application of Indian Accounting Standards (Ind-AS)
The Company adopted Indian Accounting Standards (Ind AS) from April 1,2016 and accordingly the financial
statements have been prepared in accordance with the recognition and measurement principles as notified by MCA
under the Companies (Indian Accounting Standards) Rules, 2015 (“Ind AS Rules”), as amended and other relevant
provisions of the Companies Act, 2013.
The Company has adopted all the Ind AS as applicable and relevant to the Company.
Use of Estimates
The preparation of the Company’s financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could
result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future
80
periods. Revision to accounting estimates are recognised in the period on which the estimates are revised and, if
material their effects are disclosed on the notes to the financial statements.
Current and Non-current Classification
The Company presents assets and liabilities in the Balance sheet based on current/non-current classification. An asset
are treated as current by the company when:
a) its expects to realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it holds the assets primarily for the purpose of trading;
c) it expects to realize the asset within twelve months after the reporting date; or
d) the asset is cash or cash equivalent (as defined under Ind AS 7) unless the asset is restricted from being
exchanged or used to settle a liability for at least twelve months after the reporting period.
Except the above, all other assets are classified as Non-current.
A liability is treated as current by the company when:
a) its expects to settle the liability realize the asset, or intends to sell or consume it in its normal operating
cycle;
b) it expects to settle the liability in its normal operating cycle;
c) it holds the liability primarily for the purpose of trading;
d) the liability is due to be settled within twelve months after the reporting period; or
e) it does not have an unconditional right to defer settlement of the liability for at least twelve months after
the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement
by the issue of equity instruments do not affect its classification.
Except the above, all other liabilities are classified as non-current.
Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable and fair value has been defined taking
into account contractually defined terms of payment. Operating revenue recognized is net of all promotional expenses
and discounts, rebates and/or any other incentive to customers.
Sale of Products
An entity shall account for a sale contract with a customer only when all of the following criteria are met:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customary
business practices) and are committed to perform their respective obligations;
(b) the entity can identify each party’s rights regarding the goods to be transferred;
(c) the entity can identify the payment terms for the goods to be transferred;
(d) the contract has commercial substance i.e the risk, ownership, timing or amount of the entity’s future cash flows
etc is expected to change as a result of the contract; and
(e) it is probable that the entity will collect the consideration to which it will be entitled in exchange for the goods that
will be transferred to the customer.
81
In case of sale of Copper Concentrate, Copper Reverts, Anode Slime etc. and tolling of Copper Concentrate of Khetri
and Malanjkhand origin, sales / tolling at the end of the accounting period are recorded on provisional basis as per
standard parameters for want of actual specifications and differential sales value are recorded only on receipt of actual.
This is as per consistent practice followed by the company.
Sale of Services
Income from conversion of job work is accounted for on the basis of actual quantity dispatched. When the outcome
of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction
shall be recognized by reference to the stage of completion (Percentage of Completion Method) of the transaction at
the end of the reporting period.
Advances received from the customers are reported as customer’s deposits unless the above conditions for revenue
recognition are met.
Other Operating Revenues
a. Sale of Scrap
Sale of Scrap is accounted for on delivery of material.
b. Interest from Customers
In case of credit sales,interest up to the date of Balance Sheet on all outstanding bills is accounted for on accrual basis.
c. Interest from Contractors against mobilisation advance for mining operations
Interest up to the date of Balance Sheet on all mobilisation advances for mining operations is accounted for on accrual
basis.
d. Penalty and Liquidated Damages
Penalty and liquidated damages are accounted for as and when these are realised by the company as per contract terms.
Other Income
a. Claims
Claims are recognized in the Statement of Profit & Loss (Net of any payable) including receivables from Government
towards subsidy, cash incentives, reimbursement of losses, etc, when there is certainty of realisation of such claim and
that can be measured reliably.
b. Dividend and Interest from Investments
Dividend income from Investments is recognised in the Statement of Profit and Loss when the right to receive the
dividend has been established and it is certain that the economic benefits will flow to the company and the amount of
income can be measured reliably.
Interest Income from a financial asset is recognised using Effective Interest Method. When it is probable that the
economic benefits will flow to the Company and the amount of income can be measured reliably.
c. Profit on Sale of Investment
Profit on sale of investment is recognised upon transfer of title by the company and is determined as the difference
between the sales price and the then carrying value of the investment.
d.Provisions not required written back
Provisions/Liabilities created from business activities in earlier years no longer required are accounted for.
82
e. Others
Any other income is recognised on accrual basis.
Employees Benefit
Retirement benefit costs and termination benefits
Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered
service entitling them to the contributions.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit
method, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement,
comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on
plan assets (excluding interest), is reflected immediately in the statement of financial position with a charge or credit
recognized in other comprehensive income in the period in which they occur. Re-measurement recognized in other
comprehensive income is reflected immediately in retained earnings and will not be reclassified to Statement of Profit
or Loss. Past service cost is recognized in Statement of Profit or Loss in the period of a plan amendment. Net interest
is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.
Defined benefit costs are categorized as follows:
i. Service cost (including current service cost, past service cost, etc.);
ii. Net interest expense or income; and
iii. Re-measurement.
The company presents the first two components of defined benefit costs in profit or loss in the line item ‘employee
benefits expense’.
The retirement benefit obligation recognized in the statement of financial position represents the actual deficit or
surplus in the company defined benefit plans. Any surplus resulting from this calculation is limited to the present value
of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the
plans.
A liability for a termination benefit is recognized at the earlier of when the company can no longer withdraw the offer
of the termination benefit and when the company recognises any related restructuring costs.
Short-term and other long-term employee benefits
A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick
leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in
exchange for that service.
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the
benefits expected to be paid in exchange for the related service.
Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the
estimated future cash outflows expected to be made by the company in respect of services provided by employees up
to the reporting date.
Deficit in Provident Fund
Deficit, if any, in the accounts of Provident Fund Trust ascertained on the basis of last audited accounts of the Trust
is accounted for as a charge to Revenue.
Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a
substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All
other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest expenses
83
calculated using the effective interest method and other costs that an entity incurs in connection with the borrowing
of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing
costs
Taxation
Income tax expense represents the sum of current tax and deferred tax.
Current tax
The current tax payable is based on taxable profit for the year as determined from net profit before tax as represented
in Statement of Profit and Loss and Other Comprehensive Income, in line with different provisions under Income Tax
Act 1961. Current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the
reporting period.
Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities
are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all
deductible temporary differences to the extent that it is probable that taxable profits will be available against which
those deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the
liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted
by the end of the reporting period.
Current and Deferred Tax for the year
Current and deferred tax are recognized in Statement of Profit or Loss, except when they relate to items that are
recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also
recognized in other comprehensive income or directly in equity respectively.
Property Plant and Equipments (PPE)
The cost of an item of PPE is recognized as an asset if and only if, it is probable that future economic benefits
associated with the item will flow to the company and the cost of the item can be measured reliably. The cost of an
item of PPE is the cash price equivalent at the recognition date. The cost of an item of PPE comprises:
i. Purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and
rebates.
ii. Costs directly attributable to bringing the PPE to the location and condition necessary for it to be capable of
operating in the manner intended by management.
iii. The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is
located, the obligation for which the company incurs either when the PPE is acquired or as a consequence of
having used the PPE during a particular period for purposes other than to produce inventories during that
period.
The company has chosen the cost model of recognition and this model is applied to an entire class of PPE. After
recognition as an asset, an item of PPE is carried at its cost less any accumulated depreciation and any accumulated
impairment losses.
Pending reconciliation/receipt of the final bills against capital items, capitalization is done on the basis of cost booked
and depreciation is charged accordingly. Price differences, if any, are adjusted in the year of finalization of bills.
84
In respect of expenditure during construction/development of a new unit/project in a new location, all direct capital
expenditure as well as all indirect expenditure incidentals to construction are capitalized allocating to various items of
PPE on an appropriate basis. Expansion programme involving construction concurrently run with normal production
activities in an existing unit, all direct capital expenditure in relation to such expansion are capitalized but indirect
expenditure are charged to revenue. Borrowing costs that are attributable to the acquisition or construction of
qualifying asset are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes
substantial period of time to get ready for its intended use.
Expenses incurred for implementation of new projects are carried forward against respective projects till execution.
Expenses rendered in fructuous projects abandoned subsequently are provided for in the Statement of Profit & Loss.
Physical verification of PPE is conducted every year so that all the units/offices are covered once in a block of three
years interval. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of
accounts in the year of identification.
Depreciation and Amortization
The company has used the exemption available in Ind AS 101 with respect to recognition of Plant, Property and
Equipment (PPE) and Intangible Assets at their carrying value being deemed cost.
The depreciable amount of an item of PPE is allocated on a straight line basis over its useful life prescribed in Part C
of Schedule II of the Companies Act,2013 or actual useful life of assets assessed by the Technical Committee of the
company, whichever is lower. The residual value and the useful life of an asset are reviewed, at each financial year-
end. Each part of an item of PPE with a cost that is significant in relation to the total cost of the item is depreciated
separately. Depreciation on all such items have been provided from the date they are ‘Put to Use’ till the date of sale
and includes amortization of intangible assets and lease hold assets. Freehold land is not depreciated. The residual
value of all such items is taken at 5% of the original cost of individual asset.
An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the
continued use of the asset. Certain consumable items of small value whose useful life is very limited are directly
charged to revenue in the year of purchase.
From the date Ind AS came into effect, the carrying amount of an asset is depreciated over the remaining useful life
of the asset as per estimate of remaining useful life. Wherever, the remaining useful life of an asset is nil, the carrying
amount is recognized in the opening balance of retained earnings after retaining the residual value.
Intangible Assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired
in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets
are carried at cost less any accumulated amortisation (calculated on a straight-line basis over their useful lives) and
accumulated impairment losses, if any.
Internally generated intangibles, excluding capitalised development costs, are not capitalised. Instead, the related
expenditure is recognised in the statement of profit and loss and other comprehensive income in the period in which
the expenditure is incurred. An internally generated intangible asset arising from development is recognized if all the
conditions stipulated in “Ind AS 38-Intangible Asset” are met. The useful lives of intangible assets are assessed as
either finite or indefinite. Intangible assets with finite lives are amortised over their useful economic lives and assessed
for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and
the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting
period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits
embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as
changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the
statement of profit and loss.
An intangible asset with an indefinite useful life is not amortised but is tested for impairment at each reporting date
and its useful life is reviewed in each reporting period to determine whether events and circumstances continue to
support an indefinite useful life estimate.
85
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net
disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss.
Intangible Assets other than Software are amortized over estimated useful life which is equivalent to license period,
generally not more than 5 years.
Cost of Software recognized as intangible asset, is amortised on straight line method over a period of legal right to
use with a nil residual value. Otherwise the cost of software will be charged in the year of incurrence.
Capital Work in Progress
Assets in the course of construction are included under capital work –in-progress and are carried at cost, less any
recognized impairment loss. Such capital work-in-progress, on completion, is transferred to the appropriate category
of property, plant and equipment.
Mine Development Expenditure
In case of underground mines : The expenditure on development of a new mine in all cases and on subsequent
development of a working mine is capitalized and depleted on the basis of ore raised during the year and the mineable
ore reserves estimated from time to time.
In case of working mines, where development activities are going on simultaneously: Expenses are apportioned
between capital and revenue on the basis of in-house technical estimates.
In respect of open cast mines : The expenditure on removal of waste and overburden, is capitalized and the same is
depleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodically
based on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines.
Subsequently, If any ore is reclaimed from overburden, the same is included in inventory at a value based on opening
rate of mine development expenditure with a corresponding credit in Mine development expenditure.
Expenditure incurred on development of new deposits are capital in nature and is included in mine development
expenditure. If subsequently the development activities are found to be not viable, the expenditure on such
development work included in mine development expenditure is written off in the year in which it is decided to
abandon the project.
If a working mine is closed due to economic reasons, the un-depleted value of Mine Development Expenditure related
to that mine is provided in the books of accounts in the year in which it is decided to close or suspend operation of the
mine. If later on, the closed / suspended mines are re-opened and the company remains the owner of the mines, the
unamortized Mine Development Expenditure which was fully provided in the year of closure will be written back in
the books of accounts in the year of re-opening and the company will be depleting it year wise based on the estimated
remaining life of that mine.
Overhauling Expenses
Revenue expenditure attributable to overhaul of smelter and/ or refinery is charged off to the Statement of Profit &
Loss in the year of incurrence.
Mine Closure Expenditure
Financial implications towards final mine closure plans under relevant Acts and Rules are technically estimated and
Mine Closure Reserve is created based on the estimated life of the mines over the period by charging the same to
Statement of Profit and Loss.
Non-Current Assets Held for Sale
The company classifies a non-current asset (or disposal group of assets) as held for sale if its carrying amount will be
recovered principally through a sale transaction rather than through continuing use. Immediately before the initial
classification of the asset (or disposal group) as held for sale, the carrying amounts of the asset (or all the assets and
86
liabilities in the group) are to be measured in accordance with applicable Indian Accounting Standards. The sale should
be expected to qualify for recognition as a completed sale within one year from the date of classification except as
permitted by Ind AS 105.
Inventories
Stocks of stores and spare parts, loose tools and materials-in-transit are valued at the lower of the net realizable value
and cost. The raw materials are also valued at the lower of the net realizable value and weighted average cost to the
unit if the finished goods in which they will be incorporated are expected to be sold below cost. Loose tools when
issued are charged off to revenue.
Finished goods and work-in-process are valued at the lower of the net realizable value and weighted average cost to
the unit. The cost is exclusive of financing cost, such as, interest, bank charges, administration overhead, etc. Ore is
valued at cost since its realisable value cannot be ascertained.
The value of slag under work-in-process is taken at equivalent value to the extent credited to the process, where the
said products have been generated. The reverts under work- in-process are valued at lower of cost (equivalent value
of concentrate) and net realizable value.
The stock of anode slime arising from treatment and refining processes are stated at realizable value based on the
yearend London Metal Exchange price for gold and silver after making due adjustments of their physical recovery
and the treatment and refining charges.
The inventories out of inter-unit transfers (material in transit) at the close of the year are valued and accounted in the
books of the transferor unit on the basis of cost plus transportation to the transferee unit or net realisable value
whichever is lower.
Imported materials are valued at the lower of the net realizable value and weighted average cost. In the event where
final price is not determined valuation is made on provisional cost. Variations are accounted for in the year of
finalization.
Provision is made in the accounts every year, for non-moving stores and spares (other than insurance spares) which
have not moved for more than five years. Insurance spares are fully provided for on the expiry of the life of the relevant
Property Plant and Equipments.
Physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all
the units at reasonable intervals during the year by a duly approved committee. Also, physical stock verification of
WIP and Finished Goods is undertaken by a duly approved committee at the end of every financial year alongwith an
independent agency once in a block of three years. In respect of Stores and Spares, physical verification is carried out
by external agencies once in every year covering all the units. Shortage/(Excesses), if any, identified on such physical
verification is duly adjusted in the books of accounts in the year of identification
Government Grants
All government grants are recognized as deferred income and it will be taken to Statement of Profit and Loss over the
period of time in accordance with the pattern in which the obligations are met.
Impairment of Assets (Other than Financial Assets)
The Company assesses at the end of each reporting period whether there is any indication that an asset may be
impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If the recoverable
amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of
the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately
in Statement of Profit and Loss, unless the relevant asset is carried at a revalue amount, in which case the impairment
loss is treated as a revaluation decrease.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset for which the estimates of future
cash flows have not been adjusted.
87
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is
increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-
generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the
relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a
revaluation increase.
Foreign Exchange Transactions
Transactions in currencies other than the company’s functional currency (foreign currencies) are recognized at the
rates of exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates
prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are re-
translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured
in terms of historical cost in a foreign currency are not retranslated.
Foreign currency monetary items (except overdue recoverable where realizability is uncertain) are converted using
the closing rate as defined in the Ind AS-21- The effects of changes in Foreign Exchange Rates. Non-monetary items
are reported using the exchange rate at the date of the transaction. The exchange difference gain/loss is recognized in
the Statement of Profit and Loss.
In case of long term foreign currency monetary items outstanding as of 31st March 2016,liability in foreign currency
loans relating to acquisition of fixed assets is converted using the closing rate as defined in Ind AS 21-The effects of
changes in Foreign Exchange Rates and the difference in exchange is recognized in terms of exemptions given in
paragraph D13AA of Appendix D to Ind AS-101, where the effect of exchange differences on foreign currency loans
of the company is accounted for by addition or deduction to the cost of the assets so far it relates to the depreciable
capital assets and shall be depreciated over the balance life of the assets.
Other long term foreign currency monetary items are accumulated in ‘Equity Component of Foreign Currency
asset/liability Account’ and amortized over the balance period of the asset/liability by recognition as income or
expense in each of such periods as stated under Para 29A of Ind As 21.
Provisions, Contingent Liabilities & Contingent Assets
Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past event
and it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the
amount of the obligation.
Wherever no reliable estimate could be made, a disclosure is made as contingent liability. A disclosure for a contingent
liability is also made when there is a possible obligation or a present obligation that may but probably will not require
an outflow of resources.
When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is
remote, no provision or disclosure is made.
Contingent Liabilities are disclosed in the General Notes forming part of the accounts.
Contingent Assets are not recognised in the financial statements but are disclosed in Notes to the Accounts. Such
assets occur when the inflow of economic benefits is probable. Such contingent assets are assessed continuously, if
it’s virtually certain that inflow of economic benefits will arise then such assets and the relative income will be
recognised in the financial statements.
Leasing
Assets held under lease, in which a significant portion of the risks and rewards of ownership are transferred to lessee
are classified as finance leases. All other leases are classified as operating leases. Depreciation expenses are recorded
if asset held under finance lease is depreciable. Finance expenses are recognized immediately in the statement of profit
and loss if they are not directly attributable to qualifying assets, otherwise they are capitalised in accordance with the
88
company’s general policy on borrowing costs. Operating lease payments are recognized as an expense on a straight-
line basis over the lease term.
Financial Instruments
Non Derivative Financial Instruments
(i) Initial Recognition
Financial assets and financial liabilities are recognized when the company becomes a party to the contractual
provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly
attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and
financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial
assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the
acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately
in profit or loss.
(ii) Subsequent Recognition
a. Financial assets
Financial assets are subsequently measured at amortised cost, fair value through other comprehensive income
or fair value through profit or loss.
b. Financial Liabilities
Financial liabilities are subsequently measured at amortized cost using Effective Interest Rate (EIR) method
except for derivatives, which are measured at fair value.
Derivative Financial Instruments
All derivatives are recognized and measured at fair value with changes in fair value being recognized in profit or loss
for the period.
Impairment of financial assets
At each reporting date, assessment is made whether the credit risk on a financial instrument has increased significantly
or not since initial recognition.
If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance
is measured for that financial instrument at an amount equal to 12 month expected credit losses. If the credit risk on
that financial instrument has increased significantly since initial recognition, the loss allowance is measured for a
financial instrument at an amount equal to the lifetime expected credit losses.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date is
recognised as an impairment gain or loss in the statement of profit and loss.
Events Occurring after the Reporting Period
The company adjusts the amount recognized in its financial statements to reflect adjusting material events after the
reporting period and does not adjust the amount to reflect non-adjusting events after the reporting period. However
where retrospective restatement is not practicable for a particular prior period then the circumstances that lead to the
existence of that condition and the description of how and from where the error is corrected are disclosed in Notes on
Accounts.
Dividends
89
Final dividend on shares are recorded as a liability on the date of approval by the shareholders in general meeting and
interim dividends are recorded as a liability on the date of declaration by the directors in the meeting of the Board of
Directors.
Cash and Cash Equivalents
Cash and cash equivalent in the Balance Sheet comprise cash at bank and on hand and short term deposit with an
original maturity of three months or less which are subject to insignificant risk of changes in value.
Description of Income and Expenditure Items
Income
Our total income consists of the following items:
• Revenue from Operations
• Other income
Revenue from operations. Revenue from operations comprises income sale of products in the domestic and export
markets and other operating income. Products sold include copper concentrate and refined copper and by-products,
including anode slime, copper sulphate and sulphuric acid. Our operations can be broadly divided into two categories:
(i) copper ore mining, which includes copper concentrate production, and (ii) refined copper production. Currently,
we sell (i) copper concentrates, (ii) refined copper products principally in the form of copper cathodes and continuous
cast wire rods, and (iii) other by products generated through the copper manufacturing process, including anode slime
containing gold and silver, copper sulphate and sulphuric acid. We sell our copper concentrate pursuant to global
tenders (i.e. auction) resulting in short term contracts, at prices which are based on the LME monthly average copper
prices. Copper concentrate prices are quotes as LME price minus TcRc charges. Therefore, the winning bidder is the
one who quotes the smallest TcRc charge. We sell our refined copper products off-the-shelf at a price equal to an
average LME copper cash settlement price over a certain period, plus a premium that we set on a monthly basis. Our
customers pick the period over which the average LME copper cash settlement price is based – weekly, fortnightly or
monthly. For our by-products, we sell our anode slime through the global tendering/auctioning process, based on
monthly average LME price for gold and silver content in anode slime. For copper sulphate and sulphuric acid, we
sell it off-the-shelf and set our prices on a monthly basis.
Other operating income includes revenues from sale of scrap, interest received from customers, interest received from
contractors against mobilisation advances for mining operations, provisions not required to be written back and
exchange rate variations.
Other income. Our other income consists primarily of interest on loans, advances and deposits, profits on sale of assets
and investments and miscellaneous income. Interest on loans and advances is the interest received on loans provided
to employees for purchase of house, land car and so on. Interest on deposits is the interest received on deposits with
the respective state electricity boards. Miscellaneous income includes income we receive from various sources,
including rent, electricity charges and vehicle charges recovered from employees and others, on behalf of whom we
make payments for such items and then subsequently recover from them.
Expenses
Our total expenses consists of the following items:
• Cost of materials consumed;
• Changes in inventories of finished goods, semi-finished and work in progress;
• Employee benefits expenses;
• Finance costs;
90
• Depreciation and amortisation expense; and
• General, Administration and Other expenses.
Cost of materials consumed. Cost of materials comprises among other things of Rs. 483.29 lakhs of imported raw
material like copper anodes and blister copper for GCP.
Changes in inventories of finished, semi-finished and work in progress. Changes in inventories of finished, semi-
finished and work in progress, reflect, change in opening balance and closing balance of work in progress.
Employee benefit expenses. Employee benefit expenses comprises among other things employee remuneration and
benefits such as salaries and other benefits, contributions to provident funds and other funds and staff welfare
expenses.
Finance costs. Finance costs includes interest on cash credit facilities, short term working capital loans and long term
loans availed by us.
Depreciation and amortisation expense. Depreciation expenses incurred by us is a result from the depreciation of
buildings, plants and machinery, furniture, fixtures, motor vehicles, computers, office equipment and certain other
items. Mine development expenditure assets with finite lives are amortised over the useful economic lives as
Amortisation expense.
General, Administration and Other expenses. Other expenses costs of stores, spares and tools consumed, consumption
of power, fuel and water, royalty, cess and decretal amounts, costs of sub-contracting, handling and transportation
costs, repairs & maintenance costs of buildings, plant and machinery and other administrative expenses such as rent,
insurance premiums, security expenses, taxes, consultancy charges, hire charges and other general expenses.
Results of Operations
The following table sets forth selected financial data from our standalone profit and loss account for each of Fiscal
2020, Fiscal 2019 and Fiscal 2018, derived from our Audited Financial Statements and for the nine month period
ended December 31, 2020, derived from the Condensed Interim Standalone Financial Statement, the components of
which are also expressed as a percentage of total income for the periods indicated:
Particulars Nine month period
ended December 31,
2020
Fiscal 2020 Fiscal 2019 Fiscal 2018
(Rs. in
lakhs)
(% of
total
income)
(Rs. in
lakhs)
(% of
total
income)
(Rs. in
lakhs)
(% of
total
income)
(Rs. in
lakhs)
(% of
total
income)
Income
Revenue from
operations
126452.05 98.02% 83,185.25 93.59% 1,81,625.72 98.02% 17,0590.88 97.65%
Other income 2553.63 1.98% 5,696.22 6.41% 3,665.87 1.98% 4106.56 2.35%
Total Income 129005.68 100.00% 88,881.47 100.00% 1,85,291.59 100.00% 1,74,697.44 100.00%
Expenses
Cost of materials
consumed
161.07 0.12% 628.24 0.71% 6,493.41 3.50% 41,138.01 23.55%
Changes in
inventories of
finished, semi-
finished and
work in progress
32517.81 25.21% (5113.58) -5.75% 14,336.74 7.74% (724.65) -0.41%
Employee
benefits expense
19621.98 15.21% 25962.31 29.21% 31,651.48 17.08% 32,788.84 18.77%
Finance costs 5103.52 3.96% 6041.89 06.80% 5,546.10 2.99% 2,128.65 1.22%
Depreciation and
amortisation
expenses
20178.90 15.64% 28861.08 32.47% 25,288.75 13.65% 16,465.25 9.43%
91
Particulars Nine month period
ended December 31,
2020
Fiscal 2020 Fiscal 2019 Fiscal 2018
(Rs. in
lakhs)
(% of
total
income)
(Rs. in
lakhs)
(% of
total
income)
(Rs. in
lakhs)
(% of
total
income)
(Rs. in
lakhs)
(% of
total
income)
General,
Administrative
and Other
Expenses
36,377.19 28.20% 86,272.96 97.07% 78,940.47 42.60% 70,697.80 40.47%
Total Expenses 1,13,960.47 88.34% 1,42,652.90 160.50% 1,62,256.95 87.57% 1,62,493.90 93.01%
Profit / (Loss)
Before
Exceptional
Items and Tax
15,045.21 11.66% (53771.43) -60.50% 23,034.64 12.43% 12,203.54 6.99%
Exceptional
items
- - - -
Profit / (Loss)
Before Tax
15,045.21 11.66% (53,771.43) -60.50% 23,034.64 12.43% 12,203.54 6.99%
Tax Expense
Current 3,832.00 2.97% 842.18 0.95% 9,128.93 4.93% 4,639.68 2.66%
Deferred tax (3,484.85) -2.70% 2295.83 2.58% (667.91) -0.36% (419.36) -0.24%
Profit / (Loss)
for the period
from
continuing
operations
14,698.06 11.39% (56909.44) -64.03% 14,573.62 7.87% 7,983.22 4.57%
Profit / (Loss)
from
discontinued
operations
(26.14) -0.02% (34.70) -0.04% (34.70) -0.02% (34.70) -0.02%
Tax expense of
discontinued
operations
(6.58) -0.01% (8.73) -0.01% (12.13) -0.01% (12.01) -0.01%
Profit / (Loss)
from
discontinued
operations after
Tax
(19.56) -0.02% (25.97) -0.03% (22.57) -0.01% (22.69) -0.01%
Profit / (Loss)
for the period
14,678.50 11.38% (56,935.41) -64.06% 14,551.05 7.85% 7,960.53 4.56%
Other
comprehensive
income
Items that will
not be
reclassified to
Profit/ (Loss)
(1,500.00) -1.16% (3,000.95) -3.38% (1,676.21) -0.90% 499.52 0.29%
Income Tax
relating to items
that will not be
reclassified to
Profit/ (Loss)
377.52 0.29% 755.28 0.85% 585.74 0.32% - -
Total
comprehensive
income for the
period
(Comprising
Profit / (Loss)
and other
Comprehensive
Income for the
period
13,556.02 10.51% (59181.08) -66.58% 13,460.58 7.26% 8,460.05 4.84%
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Nine month period ended December 31, 2020
Total Income
Our total income was Rs. 129,005.68 lakhs for the nine month period ended December 31, 2020.
Total Expenditure
Our total expenditure including depreciation and amortisation expenses was Rs. 113,960.47 lakhs for the nine month
period ended December 31, 2020.
Cost of materials consumed
Cost of materials consumed was Rs. 161.07 lakhs for the nine month period ended December 31, 2020.
Changes in inventories of finished goods, semi-finished and work in progress
The changes in inventories of finished goods, semi-finished and work in progress was Rs. 32,517.81 lakhs for the nine
month period ended December 31, 2020.
Employee benefit expense
Our employee benefit expenses was Rs. 19,621.98 lakhs for the nine month period ended December 31, 2020.
Finance costs
Our finance costs was Rs. 5,103.52 lakhs for the nine month period ended December 31, 2020.
Depreciation and amortisation expense
The Depreciation and amortisation expense was Rs. 20,178.90 lakhs for the nine month period ended December 31,
2020.
General, Administration and other expenses
Our general, administration and other expenses was Rs. 36,377.19 lakhs for the nine month period ended December
31, 2020 .
Profitability and Taxation
Our profit before tax was Rs. 15,045.21 lakhs for the nine month period ended December 31, 2020.
Profit after tax
As a result of the above, we had a net profit of Rs. 14,678.50 lakhs for the nine month period ended December 31,
2020.
Fiscal 2020 Compared to Fiscal 2019
Total Income
Our total income decreased to Rs. 88,881.47 lakhs in Fiscal 2020 from Rs. 1,85,291.59 lakhs in Fiscal 2019, a decrease
of 52.03%. This was primarily because of a decrease in our revenue from operations. Our revenue from operations
decreased to Rs. 83,185.25 lakhs in Fiscal 2020 from Rs. 1,81,625.72 lakhs in Fiscal 2019, a decrease of 54.20% due
to decrease in production of metal in concentrate from our mines.
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Total Expenditure
Our total expenditure including depreciation and amortisation expenses decreased to Rs.1,42,652.90 lakhs in Fiscal
2020 from Rs. 1,62,256.95 lakhs in Fiscal 2019, a decrease of 12.08%, which was generally in line with a
corresponding decrease in production in Fiscal 2020.
Cost of materials consumed. Cost of materials consumed mainly comprised cost of raw materials such as imported
raw materials at GCP. Our cost of materials consumed decreased by 90.32% from Rs. 6,493.41 lakhs in Fiscal 2019
to Rs. 628.24 lakhs in Fiscal 2020, due to less imported materials purchased for GCP.
Changes in inventories of finished goods, semi-finished and work in progress. There was a decrease in changes in
inventories of work in progress from Rs. 14,336.74 lakhs for the Fiscal 2019 to Rs.(5,113.58) lakhs for Fiscal 2020.
The change was due to one time adjustment of closing stock which is partly compensated by decrease in sales volume.
Employee benefit expense. Our employee benefit expenses decreased by 17.97% from Rs. 31,651.48 lakhs for Fiscal
2019 to Rs. 25,962.31 lakhs for Fiscal 2020. This was primarily due to superannuation of manpower in the normal
course of business.
Finance costs. Our finance costs increased by 8.94% from Rs. 5,546.10 lakhs for Fiscal 2019 to Rs. 6,041.89 lakhs
for Fiscal 2019. This was partly on account of increase in working capital and term loans.
Depreciation and amortisation expense. Depreciation and amortisation expense increased by 14.13% from Rs.
25,288.75 lakhs for Fiscal 2019 to Rs. 28,861.08 lakhs for Fiscal 2020. This increase was primarily due to adjusting
balance unamortised mine development expenditure on account of MCP’s remaining life of open cast mine coming to
an end.
General, Administration and other expenses. Our general, administration and other expenses increased by 9.29% from
Rs. 78,940.47 lakhs for Fiscal 2019 to Rs. 86,272.96 lakhs for Fiscal 2020 mainly due to provision of mill scat and
lean ore amounting to Rs. 18,331.80 lakhs which is partly compensated by decrease in other expenses.
Profitability and Taxation
Our profit before tax decreased by 333.44% from Rs. 23,034.64 lakhs for Fiscal 2019 to Rs. (53,771.43) lakhs for
Fiscal 2020 and our profit before tax margin (profit before tax as a percentage of total income) for the same periods
decreased from 12.43% to 60.50%.
Provision for taxation decreased by 62.91% from Rs. 8,461.02 lakhs for Fiscal 2019 to Rs. 3,138.01 lakhs for Fiscal
2020. Our provision for taxation decreased on account of decrease in our taxable income. Our net loss from
discontinued operations 15.06% decreased from Rs. (22.57) lakhs in Fiscal 2019 to Rs. (25.97) lakhs in Fiscal 2020.
Profit after tax
As a result of the above, we had a net loss for the same period of Rs. (56,935.41) lakhs in Fiscal 2020 as compared to
a net profit of Rs. 14,551.05 lakhs in Fiscal 2019, a decrease of 491.28%.
Fiscal 2019 Compared to Fiscal 2018
Total Income
Our total income increased to Rs. 1,85,291.59 in Fiscal 2019 from Rs. 1,74,697.44 lakhs in Fiscal 2018, an increase
of 6.06%. This was primarily because of an increase in our revenue from operations. Our revenue from operations
increased to Rs. 1,81,625.72 in Fiscal 2019 from Rs. 1,70,590.88 lakhs in Fiscal 2018 since there is an increase of
sales volume of export of copper concentrate from 7,564 CMT to 19,571 CMT and there is an additional sale of
copper reverts during Fiscal 2019.
Total Expenditure
94
Our total expenditure including depreciation and amortisation expenses increased to Rs. 1,62,256.95 lakhs in Fiscal
2019 from Rs. 1,62,493.90 lakhs in Fiscal 2018, a decrease of 0.15% due to less imported materials purchased for
GCP.
Cost of materials consumed. Cost of materials consumed mainly comprised cost of raw materials such as blister
copper. Our cost of materials consumed decreased by 84.21% from Rs. 41,138.01 lakhs in Fiscal 2018 to Rs. 6,493.41
lakhs in Fiscal 2019, mainly due to less purchase of imported raw materials for GCP during Fiscal year 2019.
Changes in inventories of finished goods, semi-finished and work in progress. There was a decrease in changes in
inventories of work in progress from Rs. (724.65) lakhs for the Fiscal 2018 to Rs. 14,336.74 lakhs for Fiscal 2019.
The change was due to higher sales volume in Fiscal 2019.
Employee benefit expense. Our employee benefit expenses decreased by 3.46% from Rs. 32,788.84 lakhs for Fiscal
2018 to Rs. 31,651.48 lakhs for Fiscal 2019. This was primarily due to depletion in manpower on account of
superannuation.
Finance costs. Our finance costs increased by 160.55 % from Rs. 2,128.65 lakhs for Fiscal 2018 to Rs. 5,546.10 lakhs
for Fiscal 2019. This was partly on account of increase in the interest on cash credit from Rs. 533.62 in Fiscal 2018 to
Rs. 1,339.00 in Fiscal 2019 and interest on working capital term loans for business operations and other term loans
from Rs. 1,595.03 in Fiscal 2018 to Rs. 4,207.10 in Fiscal 2019.
Depreciation and amortisation expense. Depreciation and amortisation expense increased by 53.59 % from Rs.
16,465.25 lakhs for Fiscal 2018 to Rs. 25,288.75 lakhs for Fiscal 2019. This increase was primarily due to adjusting
balance unamortised mine development expenditure on account of MCP’s remaining life of open cast mine coming to
an end.
General, Administration and other expenses. Our general, administration and other expenses increased by 11.66%
from Rs. 70,697.80 lakhs for Fiscal 2018 to Rs. 78,940.47 lakhs for Fiscal 2018 on account of higher royalty, cess and
decretal amounts and contractual job for process and higher cost incurred on repairs and maintenance of machinery.
Profitability and Taxation
Our profit before tax increased by 88.75% from Rs. 12,203.54 lakhs for Fiscal 2018 to Rs. 23,034.64 lakhs for Fiscal
2019 and our profit before tax margin (profit before tax as a percentage of total income) for the same periods increased
from 6.99% to 12.43%.
Provision for taxation increased by 100.48% from Rs. 4,220.32 lakhs for Fiscal 2018 to Rs. 8,461.02 lakhs for Fiscal
2019. Our provision for taxation increased on account of increase in our taxable income. Our loss from discontinued
operations of 0.53% decreased from Rs. (22.69) lakhs in Fiscal 2018 to Rs. (22.57) lakhs in Fiscal 2019.
Profit after tax
As a result of the above, our profit after tax for the same period increased by 82.79% from Rs. 7,960.53 lakhs in Fiscal
2018 to Rs. 14,551.05 lakhs for Fiscal 2019.
Liquidity and Capital Resources
Our business, in particular our copper mining operations, is capital intensive. Our primary liquidity needs have been
to finance our operations, development of our operating mines and working capital needs. Our planned expansion
projects also will require a high level of expenditure. We have historically funded our capital expenditures through
internal cash flows and borrowings. In the future, we expect to fund our planned expansion projects through a
combination of internal cash flows, equity and debt financings.
95
Cash Flows
The following table summarises our standalone cash flows for Fiscal years 2020, 2019 and 2018 and for nine month
period ended December 31, 2020:
(Rs. in lakhs)
Particulars Nine Month period
ended December 31,
2020
Fiscal
2020 2019 2018
Net cash generated from / (used
in) operating activities
60,576.96 8,602.55 25,230.35 37,178.85
Net cash generated from / (used
in) investing activities
(26,229.91) (42,983.85) (58,671.11) (55,750.67)
Net cash generated from / (used
in) financing activities
18,521.85 4,199.22 44,458.28 (9,605.50)
Net increase / (decrease) in
cash and cash equivalents
52,868.90 (30,182.08) 11,017.52 (28,177.32)
Operating activities
Net cash generated from operating activities was Rs. 8,602.55 lakhs in Fiscal 2020 and of net loss before tax of Rs.
(53,771.43) lakhs, as adjusted for, among other things, depreciation of Rs. 3589.34 lakhs, amortisation of Rs.
25,271.73 lakhs and interest expense of Rs. 6,041.89 lakhs which were offset by provisions written back of Rs.
(2,280.83) lakhs, interest income of Rs. (1,021.90) lakhs and loss on disposal of fixed assets of Rs. 2.04 lakhs, resulting
in an operating loss before working capital changes of Rs. (3,284.57) lakhs. Our operating profit before working
capital changes were further adjusted by working capital changes including increase in inventories of Rs. (5,682.60)
lakhs, increase in current and non-current assets of Rs. (3,808.73) lakhs as offset by a decrease in current and non-
current liabilities of Rs. (2,119.57) lakhs and taxes paid amounting to Rs. (4,423.72) lakhs and decrease in Trade &
other receivables of Rs. 27921.74 Lakhs.
Net cash from operating activities was Rs. 25,230.35 lakhs in Fiscal 2019 and consisted of net profit before tax of Rs.
23,034.64 lakhs, as adjusted for, among other things, depreciation of Rs. 3,661.65 lakhs, amortisation of Rs. 21,627.10
lakhs, and interest expense of Rs. 5,546.10 lakhs which were offset by provisions written back of Rs. (1,095.29) lakhs,
profit from disposal of fixed assets of Rs. 48.24 lakhs and interest income of Rs. (334.49) lakhs, resulting in an
operating profit before working capital changes of Rs. 54,291.15 lakhs. Our operating profit before working capital
changes was further adjusted by working capital changes including increases in current and non-current assets of Rs.
(7,008.79) lakhs, taxes paid amounting to Rs. (6,730.75) lakhs, increase in trade and other receivables of Rs.
(28,004.35) lakhs and decrease in current and non-current liabilities of Rs. (2,836.41) lakhs.
Net cash from operating activities was Rs. 37,178.85 lakhs in Fiscal 2018 and consisted of net profit before tax of Rs.
12,203.54 lakhs, as adjusted for, among other things, depreciation of Rs. 3,272.02 lakhs, amortisation of Rs. 13,193.23
lakhs, and interest expense of Rs. 2,128.65 lakhs which were offset by provisions written back of Rs. (1,376.96) lakhs
and interest income of Rs. (1,706.74) lakhs, resulting in an operating profit before working capital changes of Rs.
30,964.73 lakhs. Our operating profit before working capital changes was further adjusted by working capital changes
including increases in current and non-current assets of Rs. (10,664.58) lakhs and taxes paid amounting to Rs.
(4,800.00) lakhs and decrease in trade and other receivables of Rs. 8,348.78 lakhs and increase in current and non-
current liabilities of Rs. 6,376.23 lakhs.
Investing Activities
Net cash used in investing activities was Rs. (42,983.85) lakhs for Fiscal 2020 and consisted of mainly purchase of
fixed assets of Rs. (22,094.87) lakhs and mine development expenditure of Rs. (21,913.69) lakhs partially offset by
interest received of Rs. 1015.68 lakhs.
Net cash used in investing activities was Rs. (58,671.11) lakhs for Fiscal 2019 and consisted of mainly purchase of
fixed assets amounting to Rs. (40,039.64) lakhs, mine development expenditure of Rs. (19,369.43) lakhs and
investment in subsidiary of Rs. 18.50 lakhs partially offset by interest received of Rs. 415.71 lakhs.
96
Net cash used in investing activities was Rs. (55,750.67) lakhs for Fiscal 2018 and consisted of mainly purchase of
fixed assets amounting to Rs. (39,748.56) lakhs and mine development expenditure of Rs. (18,601.96) lakhs partially
offset by interest received of Rs. 2,467.98 lakhs.
Financing Activities
Net cash used in financing activities for Fiscal 2020 was Rs. (4,199.22) lakhs, consisting of repayment of non-current
borrowings of Rs. 15,895.21 lakhs, dividend payment of Rs. (4,811.14) lakhs, dividend tax payment of Rs. (988.94)
lakhs and interest payment of Rs. (5,895.91) lakhs towards our working capital loans.
Net cash used in financing activities for Fiscal 2019 was Rs. 44,458.28 lakhs, consisting of non-current borrowings
of Rs. 52,,669.68 lakhs, dividend and dividend tax payment of Rs. (2788.50) lakhs and interest payment of Rs.
(5,422.90) lakhs towards our working capital loans.
Net cash used in financing activities for Fiscal 2018 was Rs. (9,605.50) lakhs, consisting of repayment of loans
amounting to Rs. (5,207.41) lakhs, dividend and dividend tax payment of Rs. (2,227.14) lakhs and interest payment
of Rs. (2,170.95) lakhs towards our working capital loans.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements, derivative instruments or other relationships with unconsolidated
entities that were established for the purpose of facilitating off-balance sheet arrangements.
Contingent Liabilities
Given below are our contingent liabilities not provided for on a consolidated basis as of December 31, 2020:
(Rs. in lakhs)
Claims against the company not acknowledged as debt: As of December 31, 2020
Disputed VAT / CST / Entry Tax 3,516.76
Disputed Excise Duty 2,947.97
Disputed Income Tax / Provident Fund 23,113.43
Other Demand 43,634.72
Total (A) 73,212.88
Other money for which the company is contingently liable:
Bank Guarantee 1,534.33
Letter of Credit 93.17
Bill discounting -
Total (B) 1,627.50
Contingent Liability (A+B) 74,840.38
For further details, see “Financial Statements – Contingent Liabilities” on page 204.
Indebtedness
The following table summarizes our secured and unsecured indebtedness on an unconsolidated basis as of December
31, 2020:
(Rs. in lakhs)
Particulars As at December 31, 2020
Long term borrowings1
- Secured 100,491.36
- Unsecured 8,000.00
Short term borrowings1:
- Secured(including current portion) 4,000.48
- Unsecured 14,550.00
Total Indebtedness 127,041.84 1 excluding accrual interest
97
Interest Coverage Ratio
The interest coverage ratio, which we define as cash profit after tax plus interest paid / interest paid, for Fiscals 2020,
2019, and 2018 and for the nine month period ended December 31, 2020 was (3.64)%, 8.18%, 12.48% and 7.83%,
respectively.
Historical Capital Expenditures
For Fiscals 2020, 2019 and 2018 and for the nine month period ended December 31, 2020, we spent Rs. 45,296.00
lakhs, Rs. 60,246.00 lakhs, Rs. 58,981.00 lakhs and Rs 28,313.00 lakhs, respectively, on purchase of capital assets.
Our capital expenditure for Fiscals 2020, 2019 and 2018 and for the nine month period ended December 31, 2020 was
used principally for replacements & renewals of plant & machinery, mine expansion, mine development & green field
exploration stood which was funded partially through internal resources of our Company and partly through
borrowings from banks.
Commitments
As on December 31, 2020, we had the following commitments:
(in Rs. lakhs)
Particulars As at December
31, 2020
Estimated amount of contracts remaining to be executed on capital account and not provided
for (net of advance and deposit)
67,835.44
Related Party Transactions
We have engaged in the past, and may engage in the future, in transactions with related parties, including with certain
key management personnel on an arm’s length basis. Such transactions would generally be for provision of services.
For details of our related party transactions, see “Financial Statements -Related Party Transactions” on page 204.
Quantitative and Qualitative Disclosure about Market Risk
Commodity Price Risk
Our revenue, profits and cash flows are significantly impacted by changes in the LME price of copper. We enter into
commodity hedging contracts to hedge a small part of our exposures of our copper business to LME copper price
fluctuations. The principal objectives of such hedging activity are to reduce volatility of future cash flows and to
increase predictability of future revenues. However, there is no assurance that these hedging activities will adequately
protect us from price fluctuations. In fact, currently available hedging products in India only provide a coverage
duration of no more than six months.
Interest Rate Risk
As on March 31, 2020, we had Rs. 40,000.00 lakhs in unsecured working capital term loans outstanding, all of which
was subject to floating interest rates. Floating rate debt exposes us to market risk as a result of changes in interest
rates. We expect to undertake debt obligations to support capital expenditures, working capital, and general corporate
purposes, as and when required. Upward fluctuations in interest rates increase the cost of new debt and interest cost
of outstanding variable rate borrowings and therefore increase the project cost. In addition, an increase in interest rates
may adversely affect our ability to service long-term debt and to finance development of new projects, all of which
may in turn adversely affect our results of operations.
Foreign Currency Exchange Rate Risk
Although most of our sales are made to domestic customers denominated in Rupees, our products are priced based on
the LME copper price, which is quoted in U.S. Dollars. Our presentation currency is also the Indian Rupee.
Furthermore, we produce and sell commodities that are typically priced by reference to U.S. Dollar prices, while a
majority of our costs for our Indian operations are incurred in Rupees. An appreciation of Rupee against the U.S.
Dollar would mean that our price in Rupee would decrease. The exchange rate between the Rupee and U.S. dollar has
98
fluctuated substantially in recent years and may continue to fluctuate significantly in the future. We bear the complete
risk of currency exchange rate fluctuations between the Rupee and the U.S. Dollar and do not totally hedge against
currency fluctuations. Any appreciation of Rupee against the U.S. Dollar may adversely affect our sales and our results
of operations.
Changes in accounting policies in the last three years
Based on our Audited Financial Statements and the audit reports of the Company, there have been no changes in the
accounting policies of the Company during the preceding three Fiscal years ended March 31, 2020, 2019 and 2018,
except:
Financial Year Ended Summary of Changes in Accounting Policy Consequent impact of changes in
Accounting policy on the
Company’s Profits and Reserves
(As certified by the management)
March 31, 2019 01) Mine Closure Expenditure:
Upto financial year ended 31st March 2018,
financial implications towards final mine
closure plans under relevant Acts and Rules
were technically estimated and the
involvement, not being material, were charged
off on actual incurrence. In the Financial year
2018-19, such accounting policy on Mine
closure expenditure has been changed and
financial implications towards final mine
closure plans under relevant Acts and Rules
are technically estimated and Mine closure
reserve is created based on the estimated life
of mines over the period by charging the same
to statement of Profit & Loss.
Profit of the company has been
decreased by Rs. 163.00 lakh and
Mine closure reserve has been
created by the same amount.
02)Foreign Exchange Transactions: -
Upto Financial Year 2017-18, all liabilities in
foreign currency loans relating to acquisition
of fixed assets were converted using the
closing rate as defined in Ind-AS-21 and the
difference in exchange were recognized in
terms of exemptions given in paragraph D 13
AA of Appendix-D to Ind-AS-101, where the
effect of exchange differences on foreign
currency loans of the company was accounted
for by addition or deduction to the cost to the
assets so far it relates to the depreciable capital
assets and depreciated over the balance life of
the assets.
In the Financial Year 2018-19, such
accounting policy has been changed and now
only in case of Long Term Foreign currency
monetary items outstanding as of 31st March
2016, Liability in foreign currency loans
relating to acquisition of Fixed Assets is
converted using the closing rate as defined in
Ind-AS-21.
Further, unlike previous financial years, other
Long term foreign currency monetary items
are accumulated in Equity component of
foreign currency assets/ liabilities account and
amortized over the balance period of the
assets/ liabilities by recognition as income or
There is no effect in company’s
profit for such change in accounting
policy. However, currency
fluctuation reserve of Rs. 155.94
akh has been created for the first
time and Long Term Loans amount
has been reduced by that amount for
such change in Accounting Policy.
99
expense in each of such periods as stated under
Para 29A of Ind-AS-21.
03. Physical verification of Semi-Finished and
In-Process (WIP) and Finished Goods is
conducted departmentally in all the units at
reasonable intervals during the year by a duly
approved committee. Also, physical stock
verification of WIP and Finished Goods is
undertaken by a duly approved committee at
the end of every financial year along with an
independent agency once in a block of three
years. In respect of Stores and Spares, physical
verification is carried out by external agencies
once in every year covering all the units.
Shortage/(Excesses), if any, identified on such
physical verification is duly adjusted in the
books of accounts in the year of identification.
There is no effect in company’s
profit for such change in accounting
policy.
March 31, 2018 Inventories:-Upto financial year 2016-17,
Accounting policy on “Inventories” include
inter alia, liability for Excise Duty on finished
goods in stock lying at works or warehouse is
provided in the accounts and also considered
in stock valuation. Such Accounting Policy
was omitted in Financial year 2017-18 and
onwards.
Net impact of Excise Duty on
closing stock was that company’s
profits for the financial year 2016-
17 was increased by Rs. 1409.25
Lakh.
Reservations, qualifications and adverse remarks included in respective audit reports
Except as disclosed below, there have been no reservations, qualifications and adverse remarks and matters of
emphasis, highlighted by our previous statutory auditors in the Fiscals 2016, 2017 and 2018 and by our Statutory
Auditor in Fiscal 2019, 2020 and for the nine month period ended December 31, 2020.
For further details, see the section titled “Financial Statements” on page 204.
(Rs. in lakh)
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
Fiscal 2016
Qualifications
Nil Nil Nil
Emphasis of Matter
1) Note No. 35 of General Notes on Accounts to the
Financial Statements Vide Clause No. 1(i)(a) &
(b) which describes the uncertainty related to the
outcome of various lawsuits filed and claims of
demand raised against the Company by various
authorities/parties and its financial impact on the
financial statements of the company. (page no. 56
of Annual Report of 15-16)
2) Note No. 35 of General Notes on Accounts to the
Financial Statements Vide Clause No. 9 which
describes the balances under the head Sundry
Creditors, Claims Recoverable, Loans &
Advances, Sundry Debtors and Deposits from
and with various parties/Govt. Dept. etc. have not
been confirmed in number of cases(page no. 57
Nil
Nil
The Company has treated
those demands as disputed
and not acknowledged as
debt in the books and
treated the same as
Contingent Liabilities, the
total amount of which
comes to Rs. 43526.66
lakhs.
Nil
100
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
of Annual Report of 15-16)
3) Note No. 35 of General Notes on Accounts to the
Financial Statements Vide Clause No. 30 which
describes that domestic sales during the year have
been reduced by Rs. 582.65 lac being
rectification of sales of anode slime wrongly
credited to the sales account in the preceding F.Y.
2014-15(page no. 57 of Annual Report of 15-16)
Nil
Nil
Other Matters
Nil Nil Nil
Fiscal 2017
Qualifications
Nil Nil Nil
Emphasis of Matter
01. Note No. 39 of General Notes on Accounts to the
Financial Statements Vide Clause No. 2 (i) which
describes the uncertainty related to the outcome of
various lawsuits filed and claims of demand raised
against the Company by various authorities/parties
and its financial impact on the Ind AS financial
statements of the company(page no. 54 of Annual
Report of 16-17).
02. Note No. 39 of General Notes on Accounts to the
Financial Statements Vide Clause No. 10 which
describes the balances under the head Sundry
Creditors, Claims Recoverable, Loans & Advances,
Sundry Debtors and Deposits from and with various
parties/Govt. Dept. etc. have not been confirmed in
number of cases (page no.54 of Annual Report of 16-
17).
Nil
Nil
The Company has treated
those demands as disputed
and not acknowledged as
debt in the books and
treated the same as
Contingent Liabilities, the
total amount of which
comes to Rs. 38566.91
lakhs.
Nil
Other Matters
Nil Nil Nil
Fiscal 2018
Qualifications
Nil Nil Nil
Emphasis of Matter
01. Note No. 39 of General Notes on Accounts
to the Financial Statements as per Annexure-
A to the Clause no. 28, which may have
material impact on the state of affairs as well
as the profit for the year and the comparative
previous year’s figures(page no. 63 of
Annual Report of 17-18).
02. Note No. 39 of General Notes on Accounts
to the Financial Statements Vide Clause No.
(i) which describe the uncertainty related to
outcome of the various law suits filed and
claims or demand raised against the
Company by various authorities/parties and
its financial impact on the financial
statements of the Company(page no. 63 of
The same are disclosed
in explanations to audit
observations on Annual
Accounts of the company
for FY 2017-18 (Ref
page no. 131 to 166 of the
Annual Report for the FY
2017-18).
The same are disclosed in
Note No 39 (1) under
General Notes on
Accounts for the FY
2017-18.
The same are disclosed in
explanations to audit
observations on Annual
Accounts of the company
for FY 2017-18 (Ref page
no. 131 to 166 of the
Annual Report for the FY
2017-18).
The Company has treated
those demands as disputed
and not acknowledge as
debt in the books and
treated the same as
Contingent Liability, the
total amount of which
comes to Rs. 51765.56 lakh
101
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
Annual Report of 17-18).
03. Note No. 39 of General Notes on Accounts
to the Financial Statements Vide Clause No.
8 which describe the balances under the head
sundry creditors, claims recoverable, loans
and advances, sundry debtors and deposits
from and with various parties/govt.
departments etc. have not been confirmed in
number of cases(page no. 64 of Annual
Report of 17-18).
04. Note No. 39 of General Notes on Accounts
to the Financial Statements Vide Clause No.
3 the title deed for lease hold land received
from the state government and certain
freehold lands acquired through
nationalization in accordance with Indian
Copper Corporation (Acquisition of
Undertaking) Act, 1972 in respect of Indian
Copper Complex (ICC) have not been
executed in favour of the Company and in
Clause No 6 of Note No 39- General Notes
on Accounts , title deeds were not obtained
/held in the name of the company in respect
of office flat at SCOPE Complex, Delhi and
Jaipur office for book value of Rs. 62.88 Lac
(Previous year Rs. 68.06 Lac) as well as
Land & Building for book value of Rs.
6138.52 Lac (Previous year Rs. 6300.54 Lac
of Gujarat Copper Project (GCP) (page no.
64 of Annual Report of 17-18).
The same are disclosed in
in Note No. 39(8) under
General Notes on
Accounts for the FY
2017-18
The same are disclosed in
Note No. 39(3) under
General Notes on
Accounts for the FY
2017-18
and the same are disclosed
in explanations to audit
observations on Annual
Accounts of the company
for FY 2017-18 (Ref page
no. 131 to 166 of the
Annual Report for the FY
2017-18).
The same are disclosed in
explanations to audit
observations on Annual
Accounts of the company
for FY 2017-18 (Ref page
no. 131 to 166 of the
Annual Report for the FY
2017-18).
The same are disclosed in
explanations to audit
observations on Annual
Accounts of the company
for FY 2017-18 (Ref page
no. 131 to 166 of the
Annual Report for the FY
2017-18).
Other Matters
Nil Nil Nil
Fiscal 2019
Qualifications
Nil Nil Nil
Emphasis of Matter
01. Note No. 38 of General Notes on Accounts to
the Financial Statements Para 1, "Contingent
liabilities" of the accompanying standalone
financial statements which describes the
uncertainty related to the outcome of the
lawsuits filed and demand raised against the
company by various parties and Government
authorities; (page no.62 of Annual Report of 18-
19).
The same are disclosed in
Note No. 38(1) under
General Notes on
Accounts for the FY
2018-19.
The management as well as
the legal
advisors/consultants are of
the opinion that its position
will likely to be upheld in
the appellate proceedings.
The company also believes
that ultimate outcome of
these proceedings will not
have a material adverse
impact on the financial
position of the company.
102
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
02. Note No. 38 of General Notes on Accounts to
the Financial Statement Para 4 & 6 of the
accompanying standalone financial statements
which states that the title deeds, conveyance
deeds etc. in respect of certain freehold lands at
Indian Copper Complex acquired through
nationalization in accordance with Indian
Copper Corporation (Acquisition of
Undertaking) Act, 1972 are not in possession of
the company and title deeds in some locations at
Gujarat Copper Project, Delhi and Jaipur office
are yet to be executed in favor of the Company.
Title deeds for leasehold and freehold lands or
other evidences of title are pending to be
reconciled with financial records. page no. 62 of
Annual Report of 18-19).
03. Note No. 38 of General Notes on Accounts to
the Financial Statement Para 8 of the
accompanying standalone financial statements
wherein, balances under the head Claims
Recoverable, Loans & Advances, Deposits with
various parties and certain balances of
receivables, payables and other current
liabilities have not been confirmed as at March
31, 2019. Consequential impact upon receipt of
such confirmation /reconciliation/ adjustment of
such balances, if any is not ascertainable at this
stage;(page no. 62 of Annual Report of 18-19).
04. The Note No. 38 of General Notes on Accounts to
the Financial StatementPara 30 of the
accompanying standalone financial statements
The same are disclosed in
Note No. 38(4) and 38
(6) under General Notes
on Accounts for the FY
2018-19.
The same are disclosed in
Note No. 38(8) under
General Notes on
Accounts for the FY
2018-19.
The same are disclosed
Note No. 38(32) under
General Notes on
At Indian Copper Complex
(ICC) certain freehold
lands acquired through
nationalization in
accordance with Indian
Copper Corporation
(Acquisition of
Undertaking) Act, 1972,
for which title deeds,
conveyance deeds etc. are
not in the possession of the
group. The lease an
agreement of Kendadih,
Rakha and Surda Mining
Lease at ICC with the State
Government has been
renewed in respect of
leasehold lands valid upto
31.03.2020.
The title deeds in respect of
office flat at SCOPE
Complex, Delhi & Jaipur
office with total book value
of Rs. 58.47 lakh are yet to
be executed. Further, the
title deeds for Freehold and
Leasehold Land and
Building acquired in
respect of Gujarat Copper
Project (GCP) with book
value of Rs. 5859.97 lakh
are yet to be executed.
Confirmation letters of
majority of balances under
the heads Sundry Creditors,
Claims Recoverable, Loans
& confirmation letters of
majority of balances under
the heads Sundry Creditors,
Claims Recoverable, Loan
& Advances, Sundry
Debtors and Deposits from
and with various parties/
Government Departments
have been sent but in
number of cases such
confirmation letters from
the parties are yet to be
received.
Gujarat Copper Project of
the Group consists of three
units namely, Anode
103
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
regarding Gujarat Copper Project valuing Rs.
27214.50 lakh where the company has not been able
to operate profitably due to various constraint,
viability assessment needs to be done to evaluate
and adjust for possible impairment loss, if any.(page
no.6 2 of Annual Report of 18-19)
Accounts for the FY
2018-19.
Furnace (Smelter),
Refinery and Kaldo
Furnace valuing Rs.
27214.50 lakh as at March
31,2019. The Anode
Furnace and Refinery unit
has been commissioned in
October 2016 while Kaldo
unit is yet to be
commissioned. Since
commissioning, the Anode
Furnace and Refinery units
are being operated at a sub
optimal level for want of
feed stock. GCP being a
secondary smelter, the feed
stock are copper scrap,
copper blister, liberator
cathode etc. The Group has
not been able to source
these materials in the
required quantity resulting
in suboptimal operations.
The profit margin of GCP
will essentially come from
the operation of Kaldo
furnace which has the
ability to process
all types of secondary
copper material including
scrap. The second phase of
refurbishment at GCP
includes Kaldo furnace,
converter, slag granulation,
ETP, etc. which is
completed during the
current FY 2018-19 and
test run has
also being successfully
completed with the low
quality raw material copper
content as low as 30%
copper which is
generated internally in
other units.
Management is trying to
make the project viable and
exploring to source the
scrap materials directly
from the world
market. It is expected that
scrap materials will be
available during the FY
2019-20 to perform at the
desired level.
Other Matters
Nil Nil Nil
104
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
Fiscal 2020
Qualifications
Nil Nil Nil
Emphasis of Matter
01. Note No. 39 (1)of General Notes on Accounts to
the Financial Statement “Contingent liabilities”
which describes the uncertainty related to the
outcome of the lawsuits filed and demands raised
against the Company by various parties and
Government authorities;(page no. 54 of Annual
Report of 19-20).
02. Note No.39 (6) of General Notes on Accounts to
the Financial Statementwhich states that the title
deeds for freehold and leasehold land and building
acquired in respect of Gujarat Copper Project
(GCP) with book value of Rs. 5578.11 Lakh (PY:-
Rs. 5859.97 Lakh) are yet to be executed in favor
of the Company. Title deeds for other leasehold and
freehold lands available with the Company or other
evidences of title are pending to be reconciled with
the financial records.(page no. 54 of Annual Report
of 19-20).
03. Note No. 39 (8) of General Notes on Accounts to
the Financial Statement balances under the head
claims recoverable, loans & advances, sundry
debtors, deposits with various parties and certain
balances of sundry creditors and other current
liabilities have not been confirmed as at 31.03.2020
and consequent impact upon receipt of such
confirmation/ reconciliation/adjustment of such
balances, if any, is not ascertainable at this stage.
(page no. 54 of Annual Report of 19-20).
04. Note No. 39 (28))of General Notes on Accounts to
the Financial Statement regarding Gujarat Copper
project valuing Rs. 24536.34 Lakh (PY:-Rs.
27214.50 Lakh) as at March 31, 2020 where the
Company has not been able to operate profitably
due to various constraint, viability assessment
needs to be done to evaluate and adjust for possible
impairment loss, if any. (page no. 54 of Annual
Report of 19-20).
The same are disclosed
in Note No. 39(1) under
General Notes on
Accounts for the FY
2019-20
The same are disclosed in
Note No. 39(6) under
General Notes on
Accounts for the FY
2019-20.
The same are disclosed
in Note No. 39(8) under
General Notes on
Accounts for the FY
2019-20
The same are disclosed in
Note No. 39(29) under
General Notes on
Accounts for the FY
2019-20.
The management as well as
the legal
advisors/consultants are of
the opinion that its position
will likely to be
upheld in the appellate
proceedings. The company
also believes that ultimate
outcome of these
proceedings will nothave a
material adverse impact on
the financial position of the
company.
The title deeds for Freehold
and Leasehold Land and
Building acquired in
respect of Gujarat Copper
Project (GCP) with book
value of Rs. 5578.11 lakh
are yet to be executed
(Previous year Rs. 5859.97
lakh).
Confirmation letters of
majority of balances under
the heads Sundry Creditors,
Claims Recoverable, Loans
& Advances, Sundry
Debtors and Deposits from
and with various parties/
Government Departments
have been sent but in
number of cases such
confirmation letters from
the parties are yet to be
received.
Gujarat Copper Project of
the company consists of
three units namely, Anode
furnace (Smelter), Refinery
and KaldoFurnace having
aggregate book value of Rs.
24536.34 lakh as at March
31,2020. The Anode
Furnace and Refinery unit
has been commissioned in
October 2016 while Kaldo
unit is commissioned on
25.05.2020. Since
105
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
05. Note No. 39 (31) of General Notes on Accounts to
the Financial Statement which states that Closing
stock as at 31st March, 2020 has been reduced
aggregately by Rs. 25710.39 Lakh due to one-time
adjustment through write-off in value of closing
stock arising as a result of, reconciliation of metal
content in copper concentrate on inter-unit transfer
and sales, assessment of metal loss in generation of
granulated Dump Slag, handling losses and old &
oxidized concentrate. Further low grade Lean Ore
and Mill Scat not presently in use in manufacturing
process, for which provision of Rs. 18331.80 lakh
has been made in the books of accounts as at March
31, 2020 by the management. As mentioned in the
referred note, the Company has modified its
Standard Operating Procedure on Inventory
Management to strengthen the reconciliation of
inventory as an ongoing activity and identification
and segregation of unused stock for better control;
. (page no. 54 of Annual Report of 19-20).
06. Note No. 39 (33) of General Notes on Accounts to
the Financial Statement which describes the
uncertainties and the management assessment of
possible impact of COVID-19 pandemic on its
business operations, financial assets, contractual
obligations and its overall liquidity position as at
March 31, 2020. Management will continue to
monitor in future any material changes arising on
financial and operational performance of the
Company due to the impact of this pandemic and
necessary measure to address the situation. . (page
no. 55 of Annual Report of 19-20).
The same are disclosed in
Note No. 39(32) under
General Notes on
Accounts for the FY
2019-20.
The same are disclosed in
Note No. 39(34) under
General Notes on
Accounts for the FY
2019-20
commissioning, the Anode
Furnace and Refinery units
are being operated at a sub
optimal level for want of
feed stock. GCP being a
secondary smelter, the feed
stock are copper scrap,
copper blister, liberator
cathode etc. The Group has
not been able to source
these materials in the
required quantity resulting
in suboptimal operations.
Management is exploring
various alternative source
to make the plant operative.
The closing stock as on
31.03.2020 is reduced by
Rs. 25710.39 lakh (Rs.
5754.49 lakh + Rs.
19955.90 lakh) due to one-
time write off of closing
stock of KCC & ICC
respectively. Further
provision amounting to Rs.
18331.80lakh has been
made against Mill Scat and
Lean Ore at MCP, which
are not presently in use and
have no realizable value at
present.
The company has modified
the Standard Operating
Procedure (SOP) on
Inventory Management,
duly verified and certified
by an independent CA firm,
addressing all the issues to
strengthen the
reconciliation of inventory
as an ongoing
activity.
Management will continue
to monitor any material
changes arising due to the
impact of this pandemic on
financial and operational
performance of the
company and take
necessary measures to
address the situation.
106
Qualification / Matters of Emphasis / Other matters Impact Management’s Response
Other Matters
Nil Nil Nil
Fiscal 2021 (up to December 31, 2020)
Qualifications
Nil Nil Nil
Emphasis of Matter
01. Note no. 5 of General Notes on Accounts to the
Financial Statement, Title deed for freehold and
leasehold land and building acquired in respect of
Gujarat Copper Project (GCP) with the book
value of Rs. 5365.75 Lakh are yet to be executed
in favour of the company. Title deed for leasehold
and freehold lands or other evidence of title in
respect of lands at KCC, MCP and ICC, as stated
by the management are pending to be reconciled
with financial records.
02. Note no. 5 of General Notes on Accounts to the
Financial Statement, Gujarat Copper Project
valuing Rs. 27559.37 Lakh where the project is
not operating due to various constraints, viability
assessment needs to be done to evaluate and
adjust the possible impairment loss, if any.
Not ascertained yet.
Title deed for freehold and
leasehold land and building
acquired in respect of
Gujarat Copper Project
(GCP) with the book value
of Rs. 5365.75 Lakh are yet
to be executed in favour of
the company. Title deed for
leasehold and freehold of
KCC, MCP & ICC are
reconciled with financial
records by the company.
Gujarat Copper Project of
the company consists of
three units namely, Anode
furnace (Smelter), Refinery
and Kaldo Furnace having
aggregate book value of Rs.
22704.69 lakh as at
December 31,2020. The
Anode Furnace and
Refinery unit has been
commissioned in October
2016 while Kaldo unit is
commissioned on
25.05.2020. Since
commissioning, the Anode
Furnace and Refinery units
are being operated at a sub
optimal level for want of
feed stock. GCP being a
secondary smelter, the feed
stock are copper scrap,
copper blister, liberator
cathode etc. The company
has not been able to operate
profitability the plant due
to various constraints.
However, the company has
floated an ‘Expression of
Interest for Long Term
Leasing or Outright Sale of
the Gujarat Copper Project
located at Bharuch’.
Other Matters
Nil Nil Nil
Significant developments since December 31, 2020
107
Except as disclosed below and elsewhere in this Placement Document, there are no significant developments since
December 31, 2020:
a) Taloja Copper Project (TCP) operation was kept suspended due to non availability of cathode, however third
party tolling operation is continued at optimum level and Continuous supply of material and operation of
Plants at TCP and KCC and subsequent developments;
b) In respect of Surda Mining Lease, the lease agreement has expired on 31.03.2020 and the Company has
applied for the extension of the lease vide letter dated 05.08.2020. Ministry of Environment Forest Climate
Change vide its letter dated 29.12.2020 conveyed about the acceptance of recommendation of Expert
Appraisal Committee regarding grant of EC of Surda Mine and asked to submit the bank guarantee, copy of
renewed mining lease etc. Bank Guarantee has been submitted on 13.02.2021. The Company also submitted
as undertaking to pay additional premium over royalty on 13.03.2021 to Secretary (Mines) Govt. of
Jharkhand and again requested for extension of the lease. Formal letter of extension of the lease as informed
by the management is under active consideration of the Department of Mines & Geology, Government of
Jharkhand, Ranchi.
c) The Company has constructed a full scale Copper Ore Tailing (COT) Beneficiation Plant at Malanjkhand
Copper Project (MCP) for extraction of valuable minerals and metals from Copper Ore tails with a capacity
of 10000 tonne per day (TPD) at an estimated cost of Rs. 20000.00 Lakh. The intermittent trial run failed on
number of occasions (Chockage/ spillage, stoppages, cleanings, etc) and the quality and quantity of products
achieved at various stages are not as per the parameters envisaged in the contract agreement. A preliminary
notice was issued to the party to complete the project and commission the same. The party agreed to
commission the Plant, but the progress of the work at site was stopped due to lock down for COVID-19
pandemic. The Company had extended the timeline up to 31.08.2020 for supply, erection, of the thickener
and commission of the Plant. But the party failed to execute the contract and the contract got terminated with
efflux of time.
d) Gujarat Copper project of the Company consist of three units namely Anode Furnace, (Smelter), Refinery,
and Kaldo Furnace having aggregating book value of Rs. 27559.37 Lakh as at 31st December 2020. The
Anode Furnace and the Refinery Unit has been commissioned in October 2016 while the Kaldo unit is
commissioned on 25.05.2020. Since commissioning the Plant is being operated at a sub optimal level for
want of feed stock. GCP being a secondary smelter plant, the feed stock are copper scrap, copper blister,
liberator cathode etc. The Company has not been able to operate provably the Plant due to various constraints.
However the Company has floated an expression of interest for Long Term Lease or Outright sale of the
Gujarat Copper Project located at Bharuch, in which 05 bids are received online.
e) Possibility of getting mining leases in the name of the Chhattisgarh Copper Limited, one of the subsidiary
company and continue to operate this Company in long run;
108
INDUSTRY OVERVIEW
The information in this section includes extracts from publicly available documents from various sources such as
“The World Copper Factbook 2020”, “ICSG Directory of Copper Mines and Plants – September 2020 Edition” and
also includes officially prepared materials from the Ministry of Mines, Government of India and has not been prepared
or independently verified by our Company, the Book Running Lead Manager or any of their affiliates or advisers. The
data may have been re-classified by us for the purposes of presentation. The accuracy and completeness of the industry
sources and publications referred to by us, and the underlying assumptions on which such sources and publications
"are based, are not guaranteed and their reliability cannot be assured. Industry sources and publications are also
prepared based on information as of specific dates and may no longer be current or reflect current trends. Industry
sources and publications may also base their information on estimates, projections, forecasts and assumptions that
may prove to be incorrect. Further, statements in this section that are not statements of historical fact constitute
“forward looking statements”. Such forward-looking statements are subject to various risks, assumptions and
uncertainties and certain factors could cause actual results or outcomes to materially differ. Accordingly, investors
should not place undue reliance on or base their investment decision on this information.
Overview of the Indian Economy
India had a GDP, on a purchasing power parity basis, of approximately U.S $9.16 trillion in 2019. The services sector
was the largest contributor to the country’s GDP at 61.5% in 2016, while the share of agriculture and industry was
15.4% and 23%, respectively. (Source: CIA World Factbook).
India’s real GDP is expected to grow to 11.5% in 2021 making India the only major economy of the world to register
a double-digit growth in 2021.
(Source: https://www.imf.org/en/Publications/WEO/Issues/2021/01/26/2021-world-economic-outlook-update)
Global Copper Industry
Background
Copper is a malleable and ductile metallic element that is an excellent conductor of heat and electricity as well as
being corrosion resistant and antimicrobial. Copper occurs naturally in the Earth’s crust in a variety of forms. It can
be found in sulfide deposits (as chalcopyrite, bornite, chalcocite, covellite), in carbonate deposits (as azurite and
malachite), in silicate deposits (as chrysycolla and dioptase) and as pure "native" copper.
The global demand for copper continues to grow world refined usage has more than tripled in the last 50 years thanks
to expanding sectors such as electrical and electronic products, building construction, industrial machinery and
equipment, transportation equipment, and consumer and general products.
Global Copper Consumption
Copper is shipped to fabricators mainly as cathode, wire rod, billet, cake (slab) or ingot. Through extrusion, drawing,
rolling, forging, melting, electrolysis or atomization, fabricators form wire, rod, tube, sheet, plate, strip, castings,
powder and other shapes. The fabricators of these shapes are called the first users of copper. The total use of copper
includes copper scrap that is directly melted by the first users of copper to produce copper semis.
Copper and copper alloy semis can be further transformed by downstream industries for use in end use products such
as automobiles, appliances, electronics, and a whole range of other copper‐dependent products in order to meet
society’s needs.
Since 1900, apparent usage for refined copper has increased from less than 500 thousand tonnes to 24.5 million metric
tonnes in 2019 as usage over the period grew by a compound annual growth rate of 3.4% per year.
109
(Source: The World Copper Factbook 2020)
The key driver of global refined copper usage has been Asia, where demand has expanded almost eight‐fold over the
past four decades mainly due to China(51%; 12.7mn tonnes).
(Source: The World Copper Factbook 2020)
26,000
24,000
22,000
20,000
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
World Refined Copper Usage,1900‐2019Thousand metric tonnescopper
Source: ICSG
57%
1%
10%
0.5%
30%
1960 2019
2%
Refined Copper Usage by Region, 1960 versus2019Thousand metric tonnescopper
Source: ICSG
110
(Source: The World Copper Factbook 2020)
*Refined copper is typically used by semis fabricators or the “first users” of refined copper, including ingot makers,
master alloy plants, wire rod plants, brass mills, alloy wire mills, foundries and foil mills. As a result, per capita usage
of refined copper refers to the amount of copper used by industry divided by the total population and does not represent
copper used in finished products per person.
(Source: The World Copper Factbook 2020)
(Source: The World Copper Factbook 2020)
Major Uses of Copper:
Electrical: Copper is the best non‐ precious metal conductor of electricity as it encounters much less resistance
compared with other commonly used metals. Copper is also used in power cables, either insulated or uninsulated, for
high, medium and low voltage applications.
Electronics and Communications: Copper plays a key role in worldwide information and communications
technologies. HDSL (High Digital Subscriber Line) and ADSL (Asymmetrical Digital Subscriber Line) technology
allows for high‐speed data transmission, including internet service, through the existing copper infrastructure of
ordinary telephone wire. Copper and copper alloy products are used in domestic subscriber lines, wide and local area
networks, mobile phones and personal computers.
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
0
1
2
3
4
5
6
7
8
kg
pe
rp
ers
on
Po
pu
lati
on
(bln
)
World Refined Copper Usage* per Capita:1950‐2019Sources: ICSG and US CensusBureau
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015
World Population Refined Copper Usage per Capita
28,000
24,000
20,000
16,000
12,000
8,000
4,000
0
32,000
2008 2010 2012 2014 2016 2018
Direct melt scrap Refined Usage
Total Copper Usage, Including Direct Melted Copper Scrap,2008‐2018Thousand metric tonnes copper
Source: ICSG RecyclablesSurveyApril 2020
111
Construction: Copper and brass are the materials of choice for plumbing, taps, valves and fittings. Thanks in part to
its aesthetic appeal, copper and its alloys, such as architectural bronze, is used in a variety of settings to build facades,
canopies, doors and window frames.
Industrial Machinery and Equipment: Due to their durability, machinability and ability to be cast with high precision
and tolerances, copper alloys are ideal for making products such as gears, bearings and turbine blades.
Consumer and General Products: Copper and copper‐based products are used in offices, households and workplaces.
Transportation: All major forms of transportation depend on copper to perform critical functions. Copper‐nickel alloys
are used on the hulls of boats and ships to reduce marine befouling, thereby reducing drag and improving fuel
consumption. Automobiles and trucks rely on copper motors, wiring, radiators, connectors, brakes and bearings.
Today, the average internal combustion engine contains about 22.5 kg (50 lbs) of copper, while luxury cars on average
contain around 1,500 copper wires totaling about 1.6 km (1 mile) in length.
Electric vehicles (EVs) contain approximately four times more copper than conventional cars. It is used in batteries,
windings and copper rotors used in electric motors, wiring, busbars and charging infrastructure.
It is estimated that globally over 7 million electric vehicles were on the road in 2019. In an effort to reduce carbon
emissions it is expected that the use of EVs will continue to rise. The demand for EVs is also expected to increase as
a result of technology improvements, increased affordability and the deployment of more electric chargers. Each EV
charger will add 0.7kg of copper. Fast chargers can ad up to 8kg of copper each.
Equipment was the largest end use sector followed by building construction and Infrastructure.
(Source: The World Copper Factbook 2020)
Major Uses of Copper, 2019 Source: International Wrought Copper Council (IWCC) and International Copper Association (ICA)
First‐Use (Semis Production*) End‐Use
*copper and copper alloy production
112
Global Copper Pricing
Copper, as any other good or merchandise, is traded between producers and consumers. Producers sell their present
or future production to clients, who transform the metal into shapes or alloys, so that downstream fabricators can
transform these into different end‐use products. One of the most important factors in trading a commodity such as
copper is the settlement price for the present day (spot price) or for future days.
Exchanges
The role of a commodity exchange is to facilitate and make transparent the process of settling prices. Three commodity
exchanges provide the facilities to trade copper: The London Metal Exchange (LME), the Commodity Exchange
Division of the New York Mercantile Exchange (COMEX/NYMEX) and the Shanghai Futures Exchange (SHFE). In
these exchanges, prices are settled by bid and offer, reflecting the market's perception of supply and demand of a
commodity on a particular day. On the LME, copper is traded in 25 tonne lots and quoted in US dollars per tonne; on
COMEX, copper is traded in lots of 25,000 pounds and quoted in US cents per pound; and on the SHFE, copper is
traded in lots of 5 tonnes and quoted in Renminbi per tonne. More recently, mini contracts of smaller lots sizes have
been introduced at the exchanges.
The following graph illustrates copper prices and LME copper stocks from 1960 to 2019.
(Source: The World Copper Factbook 2020)
Global Copper Deposits
Mineral deposits are classified based on their geologic certainty and economic value. According to the United States
Geological Survey (USGS), copper reserves currently amount to around 870 million tonnes (Mt). Identified and
undiscovered copper resources are estimated at around 2,100 Mt and 3,500 Mt, respectively (USGS basis 2013, see
next page). The latter does not take into account the vast amounts of copper found in deep sea nodules and land‐ based
and submarine massive sulphides. Current and future exploration opportunities will lead to increases in both reserves
and known resources.
(Source: The World Copper Factbook 2020)
Global Distribution of Identified and Undiscovered Copper Resources in Porphyry and Sediment‐hosted
Stratabound Copper Deposits 1/
In 2013 the U.S. Geological Survey (USGS) completed a geology‐based, cooperative international assessment of
copper resources of the world 2/. The USGS assessed undiscovered copper in two deposit types that account for about
80% of the world’s copper supply. Porphyry copper deposits account for about 0% of the world’s copper. In porphyry
copper deposits, copper ore minerals are disseminated in igneous intrusions. Sediment‐hosted stratabound copper
deposits, in which copper is concentrated in layers in sedimentary rocks, account for about 20% of the world’s
identified copper. The mean undiscovered totals for porphyry and sediment‐hosted deposits are 3,100 and 400 Mt
respectively, resulting in a global total of 3,500 Mt of copper. With identified copper resources currently estimated at
2,100 Mt, total copper resources (undiscovered + identified) are estimated at 5,600 Mt.
10,000
9,000
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
AverageAnnual Copper Prices (LME, Grade A, Cash), 1960‐2019US$ pertonne
Source:ICSG
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015
Current $ Constant 2012 $
113
(Source: The World Copper Factbook 2020)
(Source: The World Copper Factbook 2020)
World Copper Production
Global Copper Mining
Global mine production is the principal source of copper. Historically, total world mine production has been gradually
increasing.
Primary copper production starts with the extraction of copper‐bearing ores. There are three basic ways of copper
mining: surface, underground mining and leaching. Open‐pit mining is the predominant mining method in the world.
After the ore has been mined, it is crushed and ground followed by a concentration by flotation. The obtained copper
concentrates typically contain around 30% of copper, but grades can range from 20 to 40 per cent. In the following
smelting process, sometimes preceded by a roasting step, copper is transformed into a “matte” containing 50‐70%
copper. The molten matte is processed in a converter resulting in a so‐called blister copper of 98.5‐99.5% copper
content. In the next step, the blister copper is fire refined in the traditional process route, or, increasingly, re‐melted
and cast into anodes for electro‐refining.
(Source: The World Copper Factbook 2020)
The output of electro‐refining is refined copper cathodes, assaying over 99.99% of copper.
SouthAmerica,
39%
CentralAmerica
and the
Caribbean,2%
NorthAmerica,
23%
NortheastAsia,
0%
SouthCentral
Asia and
Indochina,3%
NorthCentral
Asia,8%
Southeast Asia
Archipelagos,6%
WesternEurope,
4%
EasternEurope
and
Southwestern
Asia, 6%
Australia,1%
MiddleEast,8%
>1%
SouthAmerica,
21%
CentralAmerica
and the
Caribbean,5%
NorthAmerica,
13%
NortheastAsia,
7%NorthCentral
Asia,14%
South Central
Asia and
Indochina,15%
Southeast Asia
Archipelagos,9%
EasternEurope
and
Southwestern
Asia, 7%
Australia,1%
WesternEurope,
3%MiddleEast,5%
B.UndiscoveredCopperResourcesAfricaandthe
114
Alternatively, in the hydrometallurgical route, copper is extracted from mainly low grade oxide ores and also some
sulphide ores, through leaching (solvent extraction) and electrowinning (SX‐EW process). The output is the same as
through the electro‐refining route ‐ refined copper cathodes. ICSG estimates that in 2019, refined copper production
from SX‐EW represented around 16% of total copper refined production
Refined copper production derived from mine production (either from metallurgical treatment of concentrates or SX‐
EW) is referred to as “primary copper production”, as obtainable from a primary raw material source. However, there
is another important source of raw material which is scrap. Copper scrap derives from either metals discarded in semis
fabrication or finished product manufacturing processes (“new scrap”) or obsolete end‐of‐life products (“old scrap”).
Refined copper production attributable to recycled scrap feed is classified as “secondary copper production”.
Secondary producers use processes similar to those employed for primary production. ICSG estimates that in 2019, at
the refinery level, secondary copper refined production reached 17% of total copper refined production.
(Source: The World Copper Factbook 2020)
Copper Mine Production:
(Source: The World Copper Factbook 2020)
Since 1900, when world production was less than 500 thousand tonnes copper, world copper mine production has
grown by 3.2% per annum to 20.5 million tonnes in 2019. SX‐EW production, virtually non‐existent before the 1960s,
stood at 3.9 million tonnes in 2019.
22,000
World Copper Mine Production, 1900-2019(thousand metric tonnes copper)
Source: ICSG
20,000
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010
Concentrates SX-EW
115
(Source: The World Copper Factbook 2020)
From less than 750,000 tonnes copper in 1960, copper mine production in Latin America has increased to 8.8 million
tonnes in 2019, representing 43% of the global total. Asia has also exhibited significant growth. The region’s share of
global production has increased from just 6% to 15% over the respective period. Conversely, North America’s share
declined from 36% to 13%.
Copper Mine Production by Country: Top 20 Countries in 2019
(Thousand metric tonnes copper) Source: ICSG
(Source: The World Copper Factbook 2020)
Chile accounted for almost a third of world copper mine production in 2019 with mine output of 5.8 million tonnes
copper. Peru, which has seen a sharp increase in output since 2015, accounted for 12% of world mine production.
Trends in Copper Mining Capacity, 2000‐2024
Thousand metric tonnes copper (Bars) and Annual percentage change (Line) Source: ICSG Directory of Copper
Mines and Plants – September 2020 Edition
Copper Mine Production by Region, 1960 versus2019Thousand metric tonnescopper
Source: ICSG
Chile
Peru
China
United States
Congo
Australia
Zambia
russian fed.
Mexico
Kazakhstan
Canada
Poland
Brazil
Indonesia
Iran
Mongolia
Spain
Myanmar
Panama
Laos
0 1,000 2,000 3,000 4,000 5,000 6,000
116
(Source: The World Copper Factbook 2020)
Copper mining capacity is estimated to reach 29.5 million tonnes copper in 2024, with 18% being SX‐ EW production.
This will be 22% higher than global capacity of 24.1 million tonnes copper recorded in 2019.
(Source: The World Copper Factbook 2020)
Copper Smelter Production
(Source: The World Copper Factbook 2020)
‐
3,000
6,000
9,000
12,000
15,000
18,000
21,000
24,000
2000 2004 2008 2012 2016 2020 2024
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
Thousand metric tonnescopper
%gr
owth
2000‐2006:
+2.7%
2014‐2019:
+2.7%2007‐2013:
+2.2%
2020‐2024
+5.1%
‐
1,000
2,000
3,000
4,000
5,000
6,000
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
%gr
owth
Thousand metric tonnescopper
2000‐2006:
+4.1%
2014‐2019:
+0.7%
2007‐2013:
+3.9%
2020‐2024:
+1.7%
1980 1985
World Copper Smelter Production, 1980-2019
Thousand metric tonnes copper Source: ICSG
22,500
20,000
17,500
15,000
12,500
10,000
7,500
5,000
2,500
020151990 1995
Primary Feed
2000 2005 2010
Secondary Feed
117
Smelting is the pyro metallurgical process used to produce copper metal. In 2019, world copper smelter production
reached 20.0 million tonnes copper. Recently, the trend to recover copper directly from ores through leaching
processes has been on the increase. Primary smelters use mine concentrates as their main source of feed (although
some use copper scrap as well). Secondary copper smelters use copper scrap as their feed.
Trends in Copper Smelting Capacity, 2000 and 2024
Percentage share of total capacity, by technology type
Source: ICSG Directory of Copper Mines and Plants – September 2020 Edition
The use of Flash/Continuous technology accounted for 59% in total copper smelting capacity in 2000. This
share rose to 67% in 2019. It is expected to remain around this level until 2024. There has also been a rapid
expansion of Chinese technology, which first emerged in 2004. It now accounts for around 14% of total copper
smelting capacity.
(Source: The World Copper Factbook 2020)
Note: Capacity data reflects production capabilities not necessarily production forecasts
Copper Smelter Production by Region, 1990-2019
Thousand metric tonnes copper Source: ICSG
(Source: The World Copper Factbook 2020)
Asia’s share of world copper smelter output jumped from 27% in 1990 to 65% in 2019 as smelter production in China
expanded rapidly
2000 2024
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
Africa
1990 1993 1996 2000 2003 2006 2009 2012 2015 2018
America Asia Europe Oceania
118
Copper Smelter Production by Country: Top 20 Countries in 2019
Thousand metric tonnes copper Source: ICSG
(Source: The World Copper Factbook 2020)
In 2019, China accounted for almost 50% of world copper smelter production, followed by Japan (8%), Chile
(5%) and Russian Federation (5%).
Note: Capacity data reflects production capabilities not necessarily production forecasts
Refined Copper Production
World Refined Copper Production, 1960‐2019
Thousand metric tonnes copper Source: ICSG
(Source: The World Copper Factbook 2020)
With the emergence of solvent extraction‐electrowinning (SX‐EW) technology, refined copper produced from
leaching ores has increased from less than 1% of world refined copper production in the late 1960’s to 16% of world
output in 2019. World copper refined production amounted to
24.0 million tonnes in 2019.
Copper Smelter Production by Country: Top 20 Countries in 2019Thousand metric tonnescopper
Source: ICSG
China
Japan
Chile
Russian Fed.
Korean Rep.
Zambia
Poland
United States
Germany
Australia
Bulgaria
India
Canada
Iran
Kazakhstan
Peru
Mexico
Spain
Indonesia
Philippines
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000
01960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 2016
5,000
10,000
15,000
20,000
Refinery Primary Refinery Secondary Refinery SX-EW
119
Trends in Refined Capacity, 2000-2024
Thousand metric tonnes copper
Source: ICSG Directory of Copper Mines and Plants - September 2020 Edition
(Source: The World Copper Factbook 2020)
This chart shows world copper refinery capacity by refining process. The ratio between production and capacity is
called the capacity utilization rate. The world refinery capacity utilization rate was around 84% in 2019.
Note: Capacity data reflects production capabilities not necessarily production forecasts
Refined Copper Production by Region, 1990-2019
Thousand metric tonnes copper Source: ICSG
(Source: The World Copper Factbook 2020)
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
2000 2002 2004 2006 2008
Electrolytic
2010 2012 2014
Electrowinning
2016 2018 2020
Fire Refining
2022 2024
The World Copper Factbook 2020
Refined Copper Production by Region, 1990-2019Thousand metric tonnes copper
Source: ICSG30,000
25,000
20,000
15,000
10,000
5,000
0
Africa Asia Europe
1990 1993 1996 2000 2003 2006 2009 2012 2015 2018
America Oceania
120
Regions with the highest output of refined copper in 1990: the Americas (4,250 kt), followed by Europe (3,004
kt). Leading region in the world in 2019: Asia (13,898 kt) as compared to 2,505kt in 1990.
Refined Copper Production by Country: Top 20 Countries in 2019
Thousand metric tonnes copper Source: ICSG
(Source: The World Copper Factbook 2020)
In 2019, China accounted for 41% of world copper refined production, followed by Chile (9%), Japan (6%) and the
United States (4%).
Indian Copper Market
Background
India is the 6th largest importer of copper ore and concentrates in 2019.
The total reserves/resources of copper ore as on 1.4.2015 as per NMI database based on UNFC system are estimated
at 1.51 billion tonnes. Of these, 207.77 million tonnes (13.74%) fall under 'reserves category' while the balance 1.30
billion tonnes (86.25%) are 'remaining resources' category. (Source: Indian Minerals Yearbook 2017)
0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000
China
Chile
Japan
United States
Russian Fed.
Congo
Korean Rep.
Germany
Poland
Mexico
Australia
India
Spain
Belgium
Kazakhstan
Peru
Indonesia
Canada
Zambia
Iran
121
The largest resources of copper ore are located in the state of Rajasthan with 813.33 million tonnes (53.81%) followed
by Madhya Pradesh with 283.43 million tonnes (18.75%) containing 3.42 million tonne copper and Jharkhand with
295.39 million tonnes (19.54%) containing 3.28 million tonne of copper metal. Copper resources in Andhra Pradesh,
Gujarat, Haryana Karnataka, Maharashtra, Meghalaya, Nagaland, Odisha, Sikkim, Tamil Nadu, Telangana,
Uttarakhand and West Bengal accounted for about 7% of the total of all Indian estimated resources. (Source: Ministry
of Mines)
India’s copper ore reserve/resources contribute to about 1.5 % of world copper reserves. Mining production is 0.2%
of world’s production, whereas refined copper production capacity is about 4% of world’s production. The size of
Indian Copper Industry (consumption of refined copper per annum) is around 6.6 lakh tones, which is 3% of world
copper market. (Source: Ministry of Mines; The World Copper Factbook 2020; U.S. Geological Survey, Mineral
Commodity Summaries, February 2019)
There are three major players which dominate the copper industry in Indian markets. Hindustan Copper Ltd (HCL) in
Public sector, M/s Hindalco Industries and M/s Vedanta in Private Sector. Production in India has declined
significantly due to the permanent closure order issued to Vedanta Smelter/ refinery plant by Tamilnadu government
in May, 2018. HCL is the only vertically integrated copper producer in the country which produces refined copper
from mined ore, while M/s Hindalco Industries at Dahej in Gujarat and M/s Vedanta Industries Ltd at Tuticorin in
Tamil Nadu have set up port based smelting and refining plants. However, there are few installations to produce
Electro-won copper but their capacities are still very low and production is inconsistent. There are more than 1000
SMEs, MSMEs and unorganized sector working in the downstream and secondary recycling of copper Industries in
India. (Source: Ministry of Mines)
122
Significant mismatch between India‘s processing requirement and copper mining capacity. Approximately 100 mn
tonnes of copper ore (assuming a copper content of 1% ) is required to produce 1 mn tonne of refined copper
The copper ore production in India for 2019-20 was 3.97 mn tonnes, meeting only ~4% of the country‘s demand The
current mining capacity is entirely catered to by HCL. Custom smelters are relying on imported copper concentrate to
feed their plants. In the fiscal year 2019-20, the copper ore production in India was 3.97 million tonnes. HCL has plans
to increase its mining capacity from its current level ore production to 12.2 MTPA in phase-I in next 9 years and will
take necessary action for further capacity enhancement of mine to 20.2 MTPA in phase -II. (Source: The World Copper
Factbook 2020)
123
(Source: Market Survey on Copper, Mineral Economic Division, Indian Bureau of Mines, May 2011; Sterlite Copper
Blog)
Pricing and Tariff
The average LME price in December, 2020 was US $7,755.24 per tonne compared to average LME of US $7,063.46
per tonne in November, 2020. The average LME price during the year 2019-20 was US $5,859.54 per tonne. (Source:
Ministry of Mines)
Factors influencing Copper Markets
• Copper prices in India are fixed on the basis of the rates that rule on LME and Rupee & US Dollar exchange
rate.
• Economic growth of the major consuming countries such as China, USA, Japan, Germany, India etc.
• Growth and development in the Infrastructure, Real-estate, Telecom and Electrical Industry, Renewable
Energy and Electrical Vehicle Sector.
• Surplus/ Deficit in copper market.
Market Outlook
Copper demand is expected to grow at 7% -8% in India. Growing demand from power sector in view of Government
laying thrust on renewable energy and increasing demand from the households for consumer durables will increase
demand for copper in India. Manufacturing of electric vehicles (EV) will also augment consumption of copper as EV
use four times more copper than traditional internal combustion engines. Copper is essential to EV technology and its
supporting infrastructure and the evolving market will have a substantial impact on copper demand.
India’s per capita copper consumption currently at 0.5kg/ per person was against 8.4 kg/person in China and 4.8
kg/per person in U.S.A. The per capita copper consumption in India is expected to increase from the current level of
0.5 Kg to 1 kg by 2025. The average per capita copper consumption as of 2019 in the world is 3.2 kg (Source: The
World Copper Factbook 2020/ Ministry of Mines )
Government initiatives will further increase growth of copper consuming industries
124
OUR BUSINESS
To obtain a complete understanding of our business, prospective investors should read this section in conjunction
with “Risk Factors”, “Industry Overview”, “Financial Statements” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” on pages 40, 108, 204 and 77, respectively, as well as the financial,
statistical and other information contained in this Placement Document. Some of the information in the following
section, especially information with respect to our plans and strategies, includes certain forward-looking statements
that involve risks and uncertainties. You should read “Forward-Looking Statements” on page 14 for a discussion of
the risks and uncertainties related to those statements, and also the “Risk Factors” on page 40 for a discussion of
certain risks that may affect our business, financial condition, or results of operations. Our actual results may differ
materially from those expressed in, or implied by, forward-looking statements.
The industry data in this chapter has been extracted from various publicly available sources and data. Neither we,
nor the BRLMs, nor any other person connected with the Offer has independently verified this information. Industry
sources and publications generally state that the information contained therein has been obtained from sources
generally considered to be reliable, but their accuracy, completeness and underlying assumptions are not guaranteed
and their reliability cannot be assured. Industry publications are also prepared based on information as of specific
dates and may no longer be current. For further information, see “Industry and Market Data” and “Industry
Overview” on pages 16 and 108, respectively.
Unless the context otherwise requires, references to “our Company” are to Hindustan Copper Limited on a
standalone basis, while references to “we”, “us” or “our” are to Hindustan Copper Limited on a consolidated basis.
Our Financial Year ends on March 31 of each year, and references to a particular Financial Year are to the twelve-
month period ended March 31 of that year. Unless otherwise stated, or the context otherwise requires, the financial
information used in this section is derived from our Financial Statements included on page 204.
Overview
We are the only operating copper ore producing mining company in India. We are also the only vertically integrated
producer of refined copper in India (Source: Annual Report (2019-20), Ministry of Mines, Government of India). We
have access to around two-fifths of India’s copper ore reserves and resources as on April 1, 2020. Our Company is
central public sector undertaking under the Ministry of Mines, Government of India. Our Company was conferred
Miniratna- Category I status by the Government of India in 2008.
Our principal activities include: (a) mining of copper ore; (b) beneficiation of copper ore into copper concentrate; and
(c) smelting, refining and extruding of the refined copper in downstream saleable products. We sell copper concentrate,
copper cathode and continuous cast wire rods. In addition, we sell by-products generated through the copper
manufacturing process including anode slime containing gold and silver and sulphuric acid.
Our principal operations include three copper ore mining complexes – the Malanjkhand Copper Project (“MCP”) at
Malanjkhand in Balaghat district, Madhya Pradesh, the Khetri Copper Complex (“KCC”) at Khetrinagar in Jhunjhunu
district, Rajasthan and the Indian Copper Complex (“ICC”)at Ghatsila in East Singhbhum district, Jharkhand – each
of which consists of one or more copper ore mines and their own beneficiation plants. Further, our ICC complex also
has its own smelting and refining facilities with a production capacity of cathode of 18,500 MT/annum. Additionally,
we have a continuous cast copper wire rod plant at Taloja in Raigad district, Maharashtra with a production capacity
of 60,000 MT/annum. We also have a secondary smelter and refinery plant at our Gujarat Copper Project (“GCP”) at
Jhagadia in Bharuch district, Gujarat with a production capacity of 50,000 MT/annum.
As on April 1, 2020, we had access to around two-fifths of the copper ore reserves and resources in India with an
average grade 1.01%. Further, as on April 1, 2020, we had reserves (proved & probable) of 167.08 million tonne ore
(average grade 1.32%) and total reserves and resource of 570.40 million tonne ore (average grade 1.01%).
Set forth below is a chart of our Company’s key production and sales volumes for each of the last three Fiscal years.
125
Copper Production and Sales
(In Tonnes) Fiscal 2020 Fiscal 2019 Fiscal 2018
Production Sales Production Sales Production Sales
Copper Ore 3,967,594 - 4,122,219 - 3,674,850 -
Copper
concentrate
26,502 12,669 32,439 21,953 31,793 9,133
Refined copper products
Continuous
cast wire
rods
8443 4247 21,450 13,756 22,185 22,812
Cathode
(including
toll smelted
cathode)
5340 1492 16,215 25,64 25,949 4,490
Major By-products
Anode
Slime
5 25 48 29 60 62
Sulphuric
Acid
5943 5514 15,445 14,414 10,256 9,306
We expect that copper concentrate, rather than refined copper products, will be our primary product in the future. We
are in the process of expanding our mining capacities from approximately 3.97 MTPA as on March 31, 2020 to 12.20
MTPA in Phase-I and subsequently to 20.20 MTPA in Phase-II. This expansion plan includes (i) development of
underground mine under existing open cast mine at Malanjkhand; (ii) expanding our existing mines, namely Khetri,
Kolihan and Surda; (iii) reopening some of our mines that were closed in the past namely Kendadih and Rakha; and
(iv) establishing new mines/mining blocks, namely Banwas, Chapri, Sideshwar and Dhobani mine. In addition, for
long term growth prospects, we have applied for area reservation under Section 17A of MMDR Act 2015 in the States
of Jharkhand, Madhya Pradesh and Rajasthan.
For Fiscal 2020, 2019 and Fiscal 2018 and for the nine month period ended December 31, 2020, sale of metal in
concentrate accounted for approximately 61.10%, 50.15%, 20.11% and 97.42% of our revenue from operations,
respectively, whereas sales of continuous cast copper wire rods accounted for approximately 22.83%, 35.16%, 60.64%
and nil in Fiscals 2020, 2019 and 2018 and for the nine month period ended December 31, 2020, of our revenue from
operations, respectively. For Fiscal 2020, 2019 and Fiscal 2018 and the nine month period ended December 31, 2020,
we had consolidated total revenues of Rs. 83,185.25 lakhs, Rs. 1,81,625.72 lakhs, Rs. 1,70,590.88 lakhs and Rs.
1,26,452.05 lakhs, profit before tax continuing operation of Rs. (53,771.43) lakhs, Rs. 23,034.64 lakhs, Rs. 12,203.54
lakhs and Rs. 15,045.21 lakhs, respectively and profit after tax of Rs. (56,935.41) lakhs, Rs. 14,551.05 lakhs, Rs.
7,960.53 lakhs and Rs. 14,678.50 lakhs, respectively, each on an unconsolidated basis.
Major Events and Milestones
Competitive Strengths
We see the following as our principal competitive strengths:
126
Sole copper ore producing miner in India with a long standing presence
We have a long history in copper ore mining in India. We are the only operating copper ore producing mining company
in India. We are also the only vertically integrated producer of primary refined copper in India (Source: Annual Report
(2019-20), Ministry of Mines, Government of India). Our Company was incorporated on November 9, 1967 to take
over the plants and mines at Khetri, Kolihan in Rajasthan and Rakha Copper Project in Jharkhand from National
Mineral Development Corporation. We are a ‘Mini Ratna- Category I” Company with more than five decades of
experience in mining copper. We were named as the industry leader (base metals) at the 2016 PLATTS Global Metals
Awards. We have also been accredited with ISO 9002 certification for Continuous Cast Rod Manufacturer at our
Taloja Copper Plant. We plan to capitalize on our experience by exploring potential acquisitions of other copper and
other base metal mining companies or mines within or outside of India.
We are currently the only company in India engaged in mining of copper ore. Further, we are the only producer of
copper concentrate in India (Source: Annual Report (2019-20), Ministry of Mines, Government of India). Copper
concentrate is used for making copper anode, copper cathode and copper rod. As of April 1, 2020 our Company was
able to meet around approximately 4.00% of the entire demand for copper concentrate in India. Our Company
produced copper concentrate of 26,502 CMT, 32,439 CMT, 31,793 CMT and 16,659 CMT, in Fiscal 2020, fiscal
2019, Fiscal 2018 and the nine month period ended December 31, 2020, respectively. Our revenue from copper
concentrate was Rs. 50,824.96 lakhs, Rs. 91,087.80 lakhs, 34,305.77 lakhs, and 123,189.24 lakhs, in Fiscal 2020,
2019, Fiscal 2018 and the nine month period ended December 31, 2020, respectively.
Our Company owns all the operating mining lease of copper ore in India. We believe that there is a significant
mismatch between India‘s processing requirement and copper mining capacity. The copper ore production by our
Company was 3.97 MT, meeting only approximately 4.00% of the country‘s demand. The current mining capacity is
entirely catered to by our Company. The custom smelters in India are currently relying on imported copper concentrate
to feed their plants. We believe that our proven experience and our long standing presence with an expertise in
developing and operating copper mines, provides us an opportunity and potential to expand our operations to meet
more than 10.00% of the entire demand for copper concentrate in India in future.
Vertically integrated operations
Our copper operations span the entire value chain and consist of copper ore mining, copper ore concentration, copper
smelting, refining and extruding. Unlike other refined copper producers in India, we produce our own copper
concentrate and do not need to rely on copper concentrate imported from abroad. Therefore, our copper refining
business is generally not subject to the volatility of the international price of copper concentrate. Furthermore, since
all of our mines and smelting and refining facilities are located in India, we have relatively low logistic costs involved
in moving the copper concentrate to Indian refining facilities to produce refined copper. Being able to produce our
own copper concentrate also provides us with certainty in its quality and available quantity.
More importantly, with the mining of copper ore and production of our own copper concentrate, we have the flexibility
to either use our copper concentrate to produce refined copper, or sell our copper concentrate to other refined copper
producers in India, depending on the profitability and other business considerations of either track. As a result, we
believe that our vertically integrated operations provide us with a great deal of flexibility to change our product mix
and take advantage of market opportunities.
We sell our copper products which includes copper wire rod, copper cathodes and copper concentrate in India as well
export substantial quantity of our Copper Concentrate through tendering mechanism. Our principal operations include
three copper ore mining complexes – MCP, KCC and ICC – each of which consists of several copper ore mines and
their own beneficiation plants. Further, our ICC complex has its own smelting and refining facility. We also have a
facility at TCP to produce copper wire rod. Additionally, the concentrator plants are located adjacent to the mines,
which reduces transportation cost of ore produced from mines to the concentrator plant. The Ghatsila smelter plant is
located in the vicinity of the concentrator plant at ICC unit. Further, the Ghatsila unit is connected with rail head
having own railway and container traffic handling arrangement. All the units are well connected with national
highways and railheads.
Our operations are completely vertically integrated with copper mining, copper beneficiation, smelting, refining and
casting of refined copper metal into downstream saleable products. We mine copper ore at MCP, KCC and ICC and
process the ore in our on-site beneficiation plants to produce copper concentrate. Our copper concentrate is then either
127
(i) shipped to our smelting and refining facilities at ICC to be refined into copper cathodes, which are then transported
to TCP or (ii) sold directly to customers on an off the shelf basis. The copper cathodes received at TCP are extruded
into continuous cast rods and sold directly to customers under on an off the shelf basis. For third party clients we also
toll their copper cathodes into copper wire rod which helps us to utilize the surplus capacity available at TCP.
We are the only integrated producer of refined copper in India. Our major activities include mining, ore beneficiation,
smelting/ secondary smelting, refining and casting of refined copper metal into downstream products. Set out below
is a chart demonstrating the major activities of the Company:
Access to substantial reserves
As on April 1, 2020, we had access to around two-fifths of the copper ore reserves and resources in India with an
average grade 1.01%. Further, as on April 1, 2020, we had reserves (proved & probable) of 167.08 million tonne ore
(average grade 1.32%) and total reserves and resource of 570.40 million tonne ore (average grade 1.01%).
Further, we have planned to expand our current ore production level from approximately 3.97 MTPA (million tons
per annum) as on March 31, 2020 to 12.2 MTPA in Phase –I (under implementation) and subsequently to 20.2 million
tons per annum in Phase-II.
Set out below is the Copper Reserves and Resources available with us as on April 1, 2020:
Mines
Reserves 1
(mn Tonnes)
Average Grade
(% Cu)
Resources2
(mn Tonnes)
Average
Grade (% Cu)
MCP
Malanjkhand 120.35 1.31 186.57 0.66
ICC
Surda 5.02 1.16 26.96 0.99
Rakha 3.36 1.14 43.83 0.94
Kendadih 0.77 1.41 17.76 1.25
Sideshwar 00 00 13.73 1.46
Chapri 00 00 49.87 1.05
Tamapahar 00 00 26.46 0.86
Total ICC 9.15 1.17 178.61 1.04
KCC
Khetri 25.33 1.44 23.49 1.40
Kolihan 9.07 1.31 4.57 1.41
Chandmari 3.18 1.11 10.08 0.95
Total KCC 37.58 1.38 38.14 1.28
128
Total 167.08 1.32 403.32 0.89
Note:
1. Proved and Probable
2. Remaining Mineral Resources
Source: (i) and (ii) Base UNFC as of April 1, 2020.
Robust financial performance
Our robust financial performance positions us for future growth and expansion. Our total income was Rs. 1,29,005.68
lakhs, Rs. 88,881.47 lakhs, Rs. 1,85,291.59 lakhs and Rs. 1,74,697.44 lakhs for the nine months ended December 31,
2020 and Fiscals 2020, 2019 and 2018 while our profit after tax was Rs. 14,678.50 lakhs, Rs. (56,935.41) lakhs, Rs.
14551.05 lakhs and Rs. 7960.53 lakhs for the same period. Our overall EBITDA decreased at a CAGR of 184.93 %
from Rs. 307,97.44 lakhs in Fiscal 2018 to Rs. (18,868.46) lakhs in Fiscal 2020 due to loss reported during Fiscal
2020. We were able to achieve the margin improvement due to our strong process controls coupled with increase in
sales volume for nine months ended December 31, 2020. Our profit/ (loss) after tax for the nine months ended
December 31, 2020 and Fiscals 2020, 2019 and 2018 was Rs. 14,678.50 lakhs, Rs. (56,935.41) lakhs, Rs. 14,551.05
lakhs and Rs. 7,960.53 lakhs, respectively.
For the nine months ended December 31, 2020 and Fiscals 2020, 2019 and 2018, our EBITDA Margin was 31.89%,
(22.68)%, 29.66% and 18.05%, respectively. Our overall EBITDA margin decreased at a CAGR of 207.91%, from
18.05% in Fiscal 2018 to (22.68) % in Fiscal 2020 due to loss reported during Fiscal 2020. During the same periods,
our total debt to equity ratio was 2.47, 4.61, 1.12 and 0.79, respectively.
Experienced Management Team with a Track Record of Project Execution
We have an experienced and qualified management and technical team to operate and implement our copper mines
expansion projects. Our senior management team possesses industry and management experience in copper mining
and processing into downstream products. Our expansion plan will also be attributable to our strong management
culture that is managed by our department heads who are experienced, and have in-depth and hands-on knowledge of
our industry. Our experienced and dedicated management team also enables us to capture market opportunities,
formulate and execute business strategies, manage client expectations as well as proactively manage changes in market
conditions. Shri Arun Kumar Shukla, Chairman-and-Managing Director, with his experience in the mining industry,
has hold various positions in NMDC, Jharkhand Mineral Development Corporation and Coal India Limited. For
further details in relation to our key managerial personnel see “Board and Directors and Senior Management” on page
146.
Strategies
The key elements of our strategy include:
Increased Focus on Copper Mining and Expansion of Our Mining Capacity
Due to the competitive advantage we are producing copper concentrate in India and in view of the expected sustained
demand for copper concentrate, we have planned to expand our current ore production level from approximately 3.97
MTPA (million tons per annum) as on March 31, 2020 to 12.2 MTPA in phase–I (under implementation) and
subsequently to 20.2 million tons per annum in phase-II.
This expansion plan includes (i) development of underground mine under existing open cast mine at Malanjkhand;
(ii) expanding our existing mines, namely Khetri, Kolihan and Surda; (iii) reopening some of our mines that were
closed in the past namely Rakha, Kendadih and (iv) establishing new mines, namely Banwas, Chapri, Sideshwar
adjacent to Rakha, Dhobani at Jharkhand.
We have already re-opened the Kendadih mine and have started the production of development ore. Further, we have
already commenced production in the Banwas mine. We have also issued the production contract for our Malanjkhand
underground copper mine for producing 110 lakh tonne of ore over a span of five years. We also are in the process of
selecting MDO for development of mines in eastern sector- Chapri and Rakha.
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Our expansion plan largely involves expanding our operations further underground rather than increasing their surface
area, meaning that we will not always be faced with many of the issues that are typically involved with mine expansion
projects, such as acquiring additional land, relocating current inhabitants, establishing additional infrastructure and
obtaining additional forest clearance. This expansion plan is expected to allow us to significantly increase our copper
concentrate production and to sell copper concentrate as our primary product to other refined copper producers in
India and abroad.
Continue to Develop Long-Term Growth Prospects through Brownfield and Greenfield Exploration
We intend to develop long-term growth prospects through brownfield and greenfield exploration projects. We are
undertaking further detailed and depth exploration across all our existing mines, including the areas immediately
below the Khetri mine and Kolihan mine at KCC (in the state of Rajasthan), Surda, Kendadih and Rakha .
We have applied for allocation of fresh leases with the Governments of Rajasthan, Jharkhand and Madhya Pradesh to
grant us mining leases under Section 17A of the MMDR Act, 2015. We also intend to make such applications in
potential areas in the future. By securing further mining leases and pursuing brownfield exploration, we believe we
will be able to expand our current mining capacities for long-term growth prospects and continue to capitalize upon
the growing demand for copper in India.
We have entered into a joint venture with CDMC for exploration of copper blocks in the state of Chhattisgarh. Further,
we have formed another joint venture, Khanij Bidesh India Limited, with NALCO and MECL to identify, acquire,
develop, process and make commercial use of strategic & critical minerals in overseas locations for supply in India.
Continue to be a Low Cost, Efficient and Environmentally Friendly Mining Company
We plan to explore different outsourcing models for the development and operation of our mining assets and intend
to optimize it. By utilizing third-party contractors and latest technological upgraded equipment, we believe that we
are better able to ensure our access to the latest low cost mining technology and know-how. In concert with our mine
expansion, mine reopening and new mine projects, efficient use of outsourcing will allow us to develop our mines
based on the most cost-effective mine designs and operations through the use of the latest mining technology.
We are committed to the protection of the environment in the places where we operate and have therefore subscribed
to the principles of sustainable development. We have taken pollution control measures in all of our business activities.
We develop our facilities and operations in accordance with local laws and regulations, including the pollution control
board guidelines and standards, as well as internationally accepted good management practices on environmental
issues. We practice pollution prevention principles in all of our operational activities. We comply with various
guidelines issued by the statutory authorities such as Indian Bureau of Mines. Besides, we aim to stringently follow
the various provisions of mine safety legislations, adhere with various environment laws and guidelines issued by the
regulators. Additionally, the contractors engaged by us are required to comply with various guidelines and legislations.
Further, we have adopted various safety policies. Our mining operations are carried out as per mining plan approved
by Indian Bureau of Mines and our mines are mandatorily required to have statutory clearances including
environmental clearances and forest clearances.
In addition to providing us cost-effective mining operations, the contractors are engaged to provide us with a more
stable and predictable cost structure on a per tonne basis, thereby streamlining our overall operations. We intend to
execute the construction of all our mine expansion projects by way of awarding engineering procurement and
construction contracts through a two stage open tender process.
The first stage of issuing the tender for request for qualification has already been initiated for each of our project of
our expansion plan. We are required to fulfil the statutory requirements pertaining to environment while carrying out
mining activities within our mining leases including safety zone plantation within the mining lease boundary,
aggressive afforestation and water harvesting initiatives to mitigate the adverse effects of surface soil loss and
depletion of ground water and recycling of water, etc. to ensure sustainable mining.
Seek Additional Sources of Income, revenue of which are not dependent on LME prices
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We plan to generate revenue from waste material like waste rock, granulated slag, etc and by-product like as anode
slime containing gold, silver, copper sulphate, sulphuric acid etc. Further, our mines situated in Jharkhand (East
Singhbhum Shear Zone) are having uranium content in copper ore.
To increase the resource base of copper mineral, undertake detailed exploration activities within the existing lease
area and in other prospect of the Country
As on April 1, 2020, we had access to around two-fifths of the copper ore reserves and resources in India with an
average grade 1.01%. Further, as on April 1, 2020, we had reserves (proved & probable) of 167.08 million tonne ore
(average grade 1.32%) and total reserves and resource of 570.40 million tonne ore (average grade 1.01%).
The current reserve/ resource is based on exploration upto a vertical depth averaging at about 600 metre (ranging from
300 metre to 800 metre) across our mining leases. Presently, only reserves ranging from 150 metre to 450 metre
vertical depth are being extracted. The ore bodies are open and extended towards further depth. We have prepared
exploration plans for detailed exploration up to about 1200 metre vertical depth. Further with the recently concluded
depth exploration, our ore resource has been enhanced by around 66.50 million tonnes of which we have consumed
around 11.77 million tonnes in the last three years. This exercise also affirms the huge potential of enhancement of
reserve and resources within the mining lease of our Company and provides us with enhanced prospects in near future.
Set out below are locations where explorations for new deposits are being carried out:
Copper Business
Overview
Our operations can be broadly divided into two categories: (i) copper ore mining, which includes copper concentrate
production, and (ii) refined copper production. Currently, we sell (i) copper concentrate, (ii) refined copper products
principally in the form of copper cathodes and continuous cast wire rods, and (iii) other by-products generated through
the copper manufacturing process, including anode slime containing gold and silver, copper granulated dump slag and
sulphuric acid.
We sell our copper products which includes copper wire rod, copper cathodes and copper concentrate in India as well
export substantial quantity of our Copper Concentrate through tendering mechanism. Our principal operations include
three copper mining units – MCP, KCC and ICC – each of which consists of several copper ore mines and their own
beneficiation plants. Further, our ICC unit has its own smelting and refining facility. We also have a facility at TCP
to produce copper wire rod.
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Our operations are completely vertically integrated with copper mining, copper beneficiation, smelting, refining and
casting of refined copper metal into downstream saleable products. We mine copper ore at MCP, KCC and ICC and
process the ore in our on-site beneficiation plants to produce copper concentrate. Our copper concentrate is then either
(i) shipped to our smelting and refining facilities at ICC to be refined into copper cathodes, which are then transported
to TCP or (ii) sold directly to customers on and off the shelf basis. The copper cathodes received at TCP are extruded
into continuous cast rods and sold directly to customers under on an off the shelf basis. For third party clients we also
toll their copper cathodes into copper wire rod which helps us to utilize the surplus capacity available at TCP.
The full process of our vertically integrated copper production is as below:
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Copper Ore Mining and Copper Concentrate Production
Copper ore may be mined by either open-pit or underground methods. Open-pit mining is the predominant mining
method in the world (Source: The World Copper Factbook, 2020), with an opening wide enough to allow trucks to
enter and go deep enough to reach the ore. Underground mining is used when the amount of stripping required (i.e.
the amount of soil to be removed per tonne of ore) is too high or the geology does not permit it. In this method, the
ore is reached through a decline or shaft and brought out either by truck or rail, or is raised by a skip.
KCC has three mines – Khetri, Kolihan and Banwas. The Khetri and Kolihan mines are both underground mines. The
Banwas deposit was initially mined through a horizontal shaft from the Khetri mine. We now have started mining
from the Banwas deposit by constructing a decline. Currently, Khetri and Kolihan are existing operating underground
mines.
ICC has three mines lease area viz Surda, Kendadih and Rakha. We are currently operating Kendadih mine and are in
the process of the construction of Chapri and Sideshwar mine and reopening of Rakha mines. Our mining lease for
Surda mine has expired and we are in the process of extending the same.
MCP at Malanjkhand in Madhya Pradesh is in operation and is an open-pit mine measuring 2,200 metres in length,
600 metres in width and ultimate pit limit at 340 mRL.
Our copper ore is generally first crushed to a size of 140 mm and then is sent through belt conveyors to secondary and
tertiary units for milling to a size of 25 mm. Thereafter, the milled ore is sent for fine ore milling where the ore is
pulverized by tumbling it with steel balls in cylindrical mills. The milled ore is then treated via the
beneficiation/concentration process in flotation cells with re-agents like pine oil, xanthate and lime for separation of
copper concentrate and to eliminate much of the other material. The copper concentrate solution is then sent for
filtration and the end result is copper concentrate which can either be sold or used for smelting to produce refined
copper. Our copper concentrate generally contains 17%-28% of copper; similar levels of iron and sulphur; minor
percentages of oxides of aluminium, calcium, and silicon; and traces of precious metals that depend on the ore source.
There are no direct raw materials used in our ore mining and processing operations. Indirect raw materials include
power, fuel, water and oxygen. We procure these indirect materials from various vendors. The electricity required for
our operations is supplied by the State Government grid as well taken from Central Grid, and supplemented by our
own backup generators. Our Copper Mining operations are conducted at three mining complexes: KCC, ICC and
MCP.
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The following map shows the location of each of our operating units:
Our Mines
The following table summarizes the status of our mines and the details of the relevant mining leases in each of our
mining complexes;
Mining
Lease
Capacity as
per EC
Area (in hectare) Date of Initial
Grant of Mining
Lease
Lease Validity
Surda 0.90 388.68 16.06.1939 Lease extension was up to
March 31, 2020*
Kendadih 0.45 1139.60 03.06.1973 Extended till 02.06.2023
Rakha 3.00 785.09 29.08.1971 Extended till 28.08.2021.**
Khetri 1.5 395.07 23.02.1963 Extended till 31.03.2040
Kolihan 1.5 163.23 24.11.1966 Extended till 31.03.2040
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Chandmari - 148.45 27.12.1972 Extended till 26.12.2022
Malanjkhand 5.0 479.90 28.08.1973 Extended till 27.08.2023
*The environment clearance has been recommended by MoEFCC subject to submission of bank guarantee, extension
of mining lease and FC Stage 1 approvals
**The Company has made an application for extension of the mining lease
Our Operating Units
Khetri Copper Complex (KCC)
Khetri Copper Complex (KCC) 1
State Rajasthan
Inception 1967
Facility Mining (underground) & Beneficiation
Product Copper Concentrate
Capacity
(As per EC) Ore | 3.0 mn tonnes p.a.
1 EAC of MoEF&CC, GoI recommended for 0.9 Mtpa for Surda Mine at ICC
We have three mines in KCC – Khetri, Kolihan and Banwas. The Khetri and Kolihan mines are both underground
mines. Currently, all three existing mines at KCC are open, although production at the Chandmari mine has been
suspended as we are in the process of developing it as an underground mine. We have a beneficiation plant at KCC.
Accordingly, KCC has the facilities for manufacturing copper concentrate. Copper concentrate produced at KCC is
primarily sold to our customers in domestic market or the material is exported.
Indian Copper Complex (ICC)
Khetri Copper Complex (KCC) 1
State Rajasthan
Inception 1967
Facility Mining (underground) & Beneficiation
Product Copper Concentrate
Capacity
(As per EC) Ore | 3.0 mn tonnes p.a.
We have three mining leases at ICC – Surda, Kendadih and Rakha. Currently, only the Surda and Kendadih mine is
in operation, having been re-started in the year 2007 and 2017, respectively. We have a beneficiation plant, a smelter
and a refinery at ICC. Accordingly, ICC has the facilities for manufacturing copper concentrate and copper cathode.
It also has the facilities for producing by-products including sulphuric acid and copper sulphate.
Malanjkhand Copper Project (MCP)
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Malanjkhand Copper Project (MCP)
State Madhya Pradesh
Inception 1982
Facility Mining (opencast & underground), Beneficiation
Product Copper Concentrate
Capacity
(As per EC) Ore | 5 mn tonnes p.a.
The Malanjkhand copper deposit at MCP is the single largest copper deposit in India and accounted for approximately
64.13% of our total copper ore production in Fiscal 2020. The Malanjkhand mine consists of an open-pit mine
measuring 2,200 metres in length, 600 metres in width and final planned depth of 240 metres. Further, an underground
mine is currently under development below the open pit.
MCP has the facilities for manufacturing copper concentrate.
Gujarat Copper Project
Gujarat Copper Project (GCP)
State Gujarat
Acquisition 2015
Facility Secondary smelting & Refining
Product Copper cathode, anode slime
Capacity Cathode | 50,000 tonnes p.a.
Taloja Copper Project
Taloja Copper Project (TCP)
State Maharashtra
Inception 1988
Facility Continuous casting
Product Copper wire rod
Capacity 60,000 tonnes p.a.
TCP was set up to extrude copper cathode into copper wire rods. It utilizes the “SCR 2000 system” technology of the
U.S. company, Southwire Co. Since June 1997, our management system at TCP (in relation to manufacture of
continuous cast copper wire rod in diameters of 8 mm, 13 mm and 16 mm) has been audited. Further, the manufacture
of continuous cast copper wire rods in diameter of 8 mm, 11 mm, 12.5 mm, 16 mm & 19.6 mm is in accordance with
the requirements of the ISO 9001:2015 standard, certified by the Bureau Veritas Certification (India) Private Limited.
TCP also has NABL certification (ISO/IEC 17025:2017) for testing.
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The plant is located in the Maharashtra Industrial Development Corporation Limited (“MIDC”) area of Taloja on the
Thane-Pune Highway, near Navda Phata in Maharashtra. It is 50 km away from the Mumbai Airport. The nearest
railway stations are Panvel and Belapur. The plant enjoys locational advantages with its proximity to the JNPT seaport.
TCP is spread over an area of 32193 sq. metre. The land is leased from MIDC pursuant to a 95 year lease with effect
from September 1, 1987. The area has infrastructure facilities, including schools and health centers. The water for
TCP is obtained from the MIDC water supply scheme.
Expansion plans
In the last two Fiscals, we have completed two mine expansion projects namely Banwas mine at Khetri Rajasthan and
Kendadih mines at Ghatsila, Jharkhand.
Our ore production capacity was 3.97 MTPA as on March 31, 2020. We aim to increase this to 12.2 MTPA in phase-
1 and thereafter to 20.2 MTPA in phase-2. This expansion plan includes (i) development of underground mine under
existing open cast mine at Malanjkhand; (ii) expanding our existing mines, namely Khetri, Kolihan and Surda; (iii)
reopening some of our mines that were closed in the past namely Rakha, Kendadih and (iv) establishing new mines,
namely Banwas, Chapri, Sideshwar adjacent to Rakha at Jharkhand.
Except for the Rakha mine, we have issued EPC contracts for the expansion of projects
The following table summarizes the expansion plan of our Company:
No. Project Description of the
expansion project
Capacity (MTPA) Estimated Cost of Expansion
(in Rs. lakhs)
Current
After
Expansion
Phase-1 Phase-2 Total
Phase
1
Phase
2
1. Malanjkhand
Mine
Development of
underground mine
under existing open
cast mine
2.54 5.00 8.00 185,600.00 104,400.00 290,000.00
2. Khetri and
Kolihan
Mine
Expansion of existing
underground mine
0.86 2.30 4.40 44,300.00 46,700.00 91,000.00
3. Surda Mine Expansion of existing
underground mine
0.31 0.90 1.00 21,900.00 13,100.00 35,000.00
4. Kendadih
Mine
Re-opening of
underground Mine
Nil 0.40 0.20 9,400.00 100.00 9,500.00
5. Rakha Mine Re-opening of closed
underground Mine
Nil 1.50 2.50 31,500.00 23,500.00 55,000
6. Banwas
Mine
Development of new
underground mine
0.26 0.60 0.60 9,000.00 Nil 9000.00
7. Chapri-
Sideshwar
Mine
Development of new
underground mine
Nil 1.50 2.50 41,700.00 13,300.00 55,000.00
8. Dhobani
Block
Development of new
underground mine
Nil Nil 1.00 Nil 5,500.00 5,500.00
Total 3.97 12.20 20.20 343,400.00 206,600.00 550,000.00
Details of the reserves and resources and expected mining life
No. Mine
Area (in hectare) Reserves and Resources
as on April 1, 2020
(in million tonnes)
Expected mining life post
completion of the Phase-1
expansion
1. Malanjkhand
Mine
479.90 306.92 23 years
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No. Mine
Area (in hectare) Reserves and Resources
as on April 1, 2020
(in million tonnes)
Expected mining life post
completion of the Phase-1
expansion
2. Khetri Mine 395.07 48.82 17 years
3. Kolihan Mine 163.23 13.64 6 years
4. Chandmari Mine# 148.45 13.26 -
5. Surda Mine 388.68 31.98 17 years
6. Kendadih Mine 1139.60 32.26 36 years
7. Rakha Mine 785.09 123.52* 14 years *Depth exploration has enhanced the resources of Rakha mining lease recently by 60.17 million tonnes, thus reserve and resources as on date is
630.57 million tonnes @ 0.99% Copper. Note-This is basis tentative departmental exploratory drilling of 7500 meter / year which shall be taken up as per priority and requirement of
individual mines.
#Environment Impact Assessment/ EMP for environmental clearance under progress
Set out below is the current status of Mine capex for enhancement of capacity:
Refined Copper Production
Conversion of copper concentrate to refined copper takes as many as four steps: smelting, copper converting, fire
refining and electro-refining. Copper concentrate is smelted to produce a liquid copper matte (50-62% copper), plus
slag (waste) and sulphur dioxide gas. After smelting, the molten matte is converted into blister copper (98.5% copper),
slag and sulphur dioxide gas. The molten blister is fire refined to further reduce impurities and then poured into anode
moulds. The cooled copper is called copper anode (99.5% copper). In the final stage of purification, these anodes are
refined by an electrolytic process to obtain copper cathode, which has a metal content of 99.99% copper, and represent
the copper metal in its pure form. Cathode is melted and cast into continuous cast wire rods for wire manufacture. ICC
has a smelter plant and a refinery plant. The ICC smelter plant has an installed capacity of 20,500 TPA of blister
copper. The ICC refinery plant has an installed capacity of 18,500 TPA of copper cathode. MCP does not have
smelting or refining capabilities. TCP has an extrusion plant set up to toll copper cathode into copper wire rods. The
TCP plant has an installed capacity of 60,000 TPA.
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A flowchart detailing the copper refining process is as below:
Products and Application
The principal products in our copper production and refining business is copper concentrate, copper cathode and
continuous cast rods. We also produce sulphuric acid, copper sulphate, nickel cathode and anode slime containing
gold and silver, which are by-products of the copper smelting process.
Copper Concentrate
Our copper concentrate generally contains 17%-28% of copper; similar levels of iron and sulphur; minor percentages
of oxides of aluminium, calcium, and silicon; and traces of precious metals that depend on the ore source. The major
uses of copper concentrate is use for further production of Copper Anodes and Copper cathodes and finally Continuous
Cast Copper Rods and downstream products.
Copper Cathode
Our copper cathodes are square shaped with purity levels of 99.99%. The cathode production process at our ICC
refinery plant is accredited with ISO 9001:2015 certification. The major uses of copper cathode are in the manufacture
of copper rods for the wire and cable industry and copper tubes for consumer durable goods. Copper cathode is also
used for making alloys such as brass, bronze and alloy steel, with applications in the defence, mining and construction
industries.
Continuous Cast Copper Wire Rods
Our continuous cast copper wire rods are available in 8.0 mm, 11.0 mm, 12.5 mm, 16.0 mm and 19.6 mm diameters
with a coil size of 1500 x 900 x 600 mm and coil weight of 1.0 to 2.5 metric tonnes. Our continuous cast rods have a
homogenous structure and very fine grain size and can be drawn into ultra fine wires. Our continuous cast rods are
used for power and communication cables, strips for power and distribution transformers and magnet wires as well as
other products. Our large diameter continuous cast rods (11.0 mm, 12.5 mm and 16.0 mm) are utilized for production
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of profiles and bus bars. Our 19.6 mm diameter continuous cast rods are largely used for groove conductors and
profiles. The continuous cast rods can also be used as the basic raw material for the manufacture of wire and cable,
including winding wire, telephone cables, power cables, wiring harnesses, house wiring cables and instrumentation
and control cables. Larger diameter continuous cast rods are mainly used in strip making, whereas 8.0 mm rods are
used for wire and cable making as well as in the manufacture of flats and sections for electrical and electronic
applications.
Precious Metals
Precious metals, such as gold and silver, are found in certain quantities in our copper concentrate. Gold and silver
rates are based on the prevailing international bullion market price of the metals. In the process of production of
Copper cathodes, such precious metals are present in the Anode slime generated in the refining process. Accordingly,
we sell anode slime containing gold and silver as a by-product in the export market.
By-Products
We have a sulphuric acid plant located at ICC. The sulphur dioxide gas generated from the flash furnace is treated in
the sulphuric acid plant to produce sulphuric acid. We sell sulphuric acid, copper slag and copper sulphate crystals,
which are by-products of our refined copper production processes, in the domestic markets.
Smelting
Copper concentrate is processed at the ICC smelter plant to convert it into copper anodes. After drying of the copper
concentrate in a rotary dryer, it is smelted in a flash furnace to produce copper matte (50-62% copper), which is further
fired in a converter to produce blister copper (98.5% copper). Blister copper is then fire refined to produce copper
anode (99.5% copper). The sulphur dioxide gas produced during the smelting process is treated in our ICC sulphuric
acid plant to produce sulphuric acid.
Refining
Copper anodes are processed at the ICC refining plant to convert them into copper cathode. Our ICC refining plant
uses the conventional electro-refining technology to refine copper anode (99.5% copper) electrolytically into copper
cathode (99.99% copper). Copper anodes are electrolyzed in copper sulphate and a sulphuric acid electrolyte solution.
During the process of electrolysis, insoluble impurities containing precious metals are separated as anode slime.
Copper cathode is either sold to customers or sent to our copper extrusion plant at TCP. Anode slime containing gold
and silver is sold in the export market.
Raw Materials and Cost of Production
Historically, we have been able to secure an adequate supply of the principal inputs for our refined copper production.
As a precautionary measure, we maintain a stockpile of each of the principle inputs for our refined copper production,
which we keep in storage at our plant locations. Depending on the amount used by our copper smelting and refinery
plants and our extrusion plant and the lead-time required to receive the input, we maintain a stockpile of principal
inputs covering approximately 45-50 production days. The principal inputs for our refined copper production business
are copper concentrate, power, fuel, water and oxygen.
Distribution, Logistics and Transportation
Most of our sales of refined products are domestic sales, where the sale is either “free on rail” or “free on truck” so
that transportation is arranged by our customers at their cost. We sell copper concentrate from our KCC and MCP
mining complexes to domestic as well as overseas customers. When exported, the sale is on FOB (free on board) basis.
We sell copper cathode from our ICC smelting and refining plants. We also sell copper wire rods from our TCP plant.
Furthermore, we ship part of our copper concentrate from our MCP mining complex to our ICC complex by rail for
smelting and refining. We also ship part of the resulting copper cathode from the ICC complex to our TCP plant for
extrusion. Due to our multi-location operations, management of logistics has been a critical factor. We contract with
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various transporters to provide us with a complete multimodal logistics solution across all of our operating units. This
includes end-to-end multi-modal transportation of semi-finished and finished products between our operating units
and to our customers.
Sales and Marketing
We sell copper concentrate to both domestic as well as overseas customers. We also sell refined copper products in
the domestic market and the by-products are sold in the domestic market as well as exported. Our sales and marketing
activities are overseen from our regional sales offices in Delhi, Mumbai, Bangalore and Kolkata. All payments by
domestic customers are in Rupees and by overseas customers in foreign currencies but the prices of our products are
pegged to the U.S. dollar through the application of the LME copper price. For Fiscal 2020, we sold 5,739 MT of
refined copper and 12,669 MT of metal in concentrate.
Employees
As on March 1, 2021, our Company had 1,668 permanent Employees. All of our permanent employees (except
permanent executives) are unionized. We believe that our relations with our employees and unions are generally good,
although we have in the past and may in the future experience industrial actions or disputes.
Competition
We are the only operating copper ore producing mining company in India. We are also the only company in India that
is completely vertically-integrated in our copper mining and processing operations. Therefore, we believe that we do
not and will not encounter intense competition in our production and sales of copper concentrate within India. We do
face competition from copper mining companies outside of India for production of copper concentrate, but we believe
that our geographic proximity to our target customers, namely the refined copper producers in India, will result in
lower logistics costs and a competitive advantage to our Company. The factors influencing competition vary by region
and end-use market. However, copper is a commodity product and we compete primarily on the basis of price and
service, with price being the most important consideration when supplies of copper are abundant. Copper is sold
directly to consumers at prices benchmarked to the cash settlement price, weekly average, fortnightly average or
monthly average of the LME price.
Safety
Although mining is an inherently dangerous activity, we have endeavoured to conduct our mining operations safely.
We regularly monitor our safety procedures and review our safety records. As part of our efforts to help ensure safety
in our mining operations, we have followed a number of requirements and procedures including training for a number
of employees working in the mines, implementation of a policy of strict compliance with the Mines Act in the
formation of benching, which is the construction of a mine, a number of training courses to help raise safety awareness
levels among our workforce and use of machinery and equipment in our mines and processing plants with built-in
safety features.
Information Technology
Our IT systems are vital to our business, we use our IT systems in key areas like finance, manufacturing, mining and
marketing. The key functions of our IT team include establishing and maintaining enterprise information systems and
infrastructure services to support our business requirements and maintaining secure enterprise operations. We have
installed ERP solutions which has enabled us to adopt a centralized business management platform based on which
the entire Company has been unified, it has increased the real-time visibility of critical business parameters, thereby
strengthening financial management and spares control, supply chain management, customer service and human
resource functions. For the procurement of stores and spares over an amount of rupees two lakhs, we make use of EPS
which is conducted by a third party and we use e-reverse auction for procurement of high value items. Further, we use
real time LME booking to enable customers to place on-line orders for copper wire and cathode with our Company at
a real time LME rate.
Property
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Our Registered and Corporate Office is located at Tamra Bhavan, 1, Ashutosh Chowdhury Road, Kolkata – 700 019,
which is owned by our Company. Further, we have both freehold and leasehold lands on our project sites. We intend
to acquire or lease additional premises for offices and other purposes relating to our business, both in India and abroad,
as the need arises.
Awards
• Best CSR Impact Initiative Award at the National Awards for Excellence in CSR & Sustainability, 2018,
under the category of ‘Best Corporate Social Responsibility Practices.’
• “ET Now presents CSR Leadership Awards” by World CSR Day under the category of ‘Safe Drinking
Water’ 2019.
• One of the top 50 organizations with Innovative HR Practices under PSU category in the Asia Pacific HRM
Congress Awards 2018.
• The Quality Circle team “Sahyog” of ICC Refinery won in Gold category during the Chapter Convention on
Quality Circle (CCQC) and Excellent Award in Nation Convention on Quality Circle (NCQC) in 2018.
• "SKOCH ORDER-OF-MERIT" for qualifying amongst top 30 Skill Development Projects in India.
• SKOCH AWARD "SKILL DEVELOPMENT GOLD" for Skill Development Project.
• Surda mines of ICC won in Storage, Transport and use of Explosives in All India underground metal mines
safety, cleanliness and silicosis awareness week, 2018.
• MCP won five awards in the category of fully mechanized mine at 28th Mines Environment and Mineral
Conservation (MEMC) Week 2018-19 held under the aegis of the Indian Bureau of Mines, Jabalpur Region.
• Kolihan Copper Mine, Rajasthan won the National Safety Awards (Mines) for year 2015 under category
LAFP-Type-6.
• Surda Copper Mine, Jharkhand got runner-up prize at National Safety Awards (Mines) for year 2015 under
category LAFP-Type-6.
Intellectual Property
We do not currently hold a trademark registration for our logo appearing on the cover page of this Placement
Document.
Corporate Social Responsibility
We are committed to social, economic and environmental development of communities at all its operations and are
committed to long term, mutually beneficial partnership between the communities, Government and the stakeholders.
In terms of section 135 and Schedule VII of the Companies Act, 2013, our Board of Directors have constituted CSR
Committee, which has developed a CSR policy. In Fiscal 2020, an amount of Rs. 331.00 lakhs was spent on CSR
projects. Some of the key CSR initiatives undertaken by us include:
• eradicating hunger, poverty and malnutrition, promoting preventive health care and sanitation and making
available safe drinking water;
• promoting education including special education and employment enhancing skills especially among children,
women and elderly and the differently abled and livelihood enhancement projects;
• ensuring environmental sustainability, ecological balance, protection of flora and fauna, conservation of natural
resources and maintaining quality of soil, air and water;
• training to promote rural sports, nationally recognised sports, paralympics sports and olympic sports;
• promotion and support for culture and restoration of national heritage buildings;
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REGULATIONS AND POLICIES
The following description is a summary of certain sector specific laws and regulations currently in force in India,
which are applicable to the business of a mining company. The information detailed in this section has been obtained
from publications available in the public domain. The description below may not be exhaustive, and is only intended
to provide general information to the Bidders, and is neither designed as, nor intended to substitute, professional legal
advice. Judicial and administrative interpretations are subject to modification or clarification by subsequent
legislative, judicial or administrative decisions.
National Mineral Policy, 2019
The GoI approved the National Mineral Policy, 2019, (the “NMP”) revisiting the previous National Mineral Policy,
2008, which aims at exploration, extraction and management of minerals have to be guided by national goals and
perspectives, to be integrated into the overall strategy of the country’s economic development.
The NMP highlights the importance of exploring the country’s entire geological potential, it shall be ensured that
regional and detailed exploration is carried out systematically, scientifically and intensively over the entire
geologically conducive mineral bearing area of the country, using state-of-the-art technologies, including seismic
2D/3D interpretative systems, in a time bound manner. It calls for the maximization of extraction of mineral
resources, located through exploration and prospecting, through scientific methods of mining, beneficiation and
economic utilization. It proposes use of equipment and machinery which will improve the efficiency, productivity
and economics of mining operations as well as mineral beneficiation process, safety and health of persons working
in the mines/beneficiation plant and surrounding areas shall be encouraged. Availability of such equipment and
machinery shall be incentivized and freely allowed. At the same time capacities shall be developed for indigenous
industry for manufacture of mining machinery and mineral beneficiation equipment and machinery for which
induction of modern technology and participation shall be encouraged.
The Mines and Minerals (Development and Regulations) Act, 1957 (“MMDR Act”)
The MMDR Act and the Mineral Concession Rules, 1960 (“MCR Rules”) govern mining rights and the operations
of mines in India. Mining leases are granted under the MMDR Act, which was enacted to provide for the
development and regulation of mines and minerals under the control of the Indian Government. The MMDR Act
also deals with the measures required to be taken by the lessee for the protection of the environment from any
adverse effects of mining.
Labour Laws
Depending on the nature of work and number of workers employed at any workplace, various labour related
legislations may apply to us. The following is an indicative list of labour laws applicable to our operations in India:
• The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952;
• The Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996;
• Building and Other Construction Workers Welfare Cess Act 1996
• Inter State Migrant Workers Act, 1979;
• The Industrial Disputes Act, 1947;
• The Employees’ State Insurance Act, 1948;
• The Factories Act, 1948;
• The Maternity Benefit Act, 1961;
• The Contract Labour (Regulation and Abolition) Act, 1970;
• The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013;
• The Employee's Compensation Act, 1923;
• The Minimum Wages Act, 1948;
• The Payment of Wages Act, 1936;
• The Payment of Gratuity Act, 1972;
• The Payment of Bonus Act, 1965;
• The Industrial Employment (Standing Orders) Act, 1946;
• The Trade Unions Act, 1926; and
144
• Relevant State Shops and Commercial Establishments Acts, where applicable
Environment Protection Act, 1986 (“EPA”) and Environment (Protection) Rules, 1986
The EPA is the umbrella legislation in respect of the various environmental protection laws in India. Under the EPA,
the GoI is empowered to take any measure it deems necessary or expedient for protecting and improving the quality
of the environment and preventing and controlling environmental pollution. This includes rules for, inter alia, laying
down standards for the quality of environment, standards for emission of discharge of environment pollutants from
various sources, as provided under the Environment (Protection) Rules, 1986, inspection of any premises, plant,
equipment, machinery, examination of manufacturing processes and materials likely to cause pollution. Penalties for
violation of the EPA include fines up to ₹ 100,000 or imprisonment of up to five years, or both. If the violation
continues beyond a period of one year after the date of conviction, the offender shall be punishable with imprisonment
for a term which may extend upto seven years.There are provisions with respect to certain compliances by persons
handling hazardous substances, furnishing of information to the authorities in certain cases, establishment of
environment laboratories and appointment of Government analysts.
Air (Prevention and Control of Pollution) Act, 1981 (“Air Act”)
The Air Act has been enacted to provide for the prevention, control and abatement of air pollution. The Air Act was
enacted with a view to protect the environment and surroundings from any adverse effects of the pollutants that may
emanate from any factory or manufacturing operation or activity. It lays down the limits with regard to emissions and
pollutants that are a direct result of any operation or activity. Periodic checks on the factories are mandated in the form
of yearly approvals and consents from the respective state pollution control boards. Pursuant to the provisions of the
Air Act, any person, establishing or operating any industrial plant within an air pollution control area, must obtain the
consent of the relevant state pollution control board, prior to establishing or operating such industrial plant. The state
pollution control board may then grant consent, subject to mentioned conditions relating to pollution control
equipment to be installed at the facilities. No person operating any industrial plant in any air pollution control area is
permitted to discharge the emission of any air pollutant in excess of the standards laid down by the state pollution
control board.
Water (Prevention and Control of Pollution) Act, 1974 (“Water Act”) and Water (Prevention and Control of
Pollution) Cess Act, 1977
The Water Act aims to prevent and control water pollution as well as restore water quality by establishing and
empowering the central and state pollution control board. Under the Water Act, any person establishing any industry,
operation or process, any treatment or disposal system, using any new or altered outlet for the discharge of sewage or
new discharge of sewage, must obtain the consent of the relevant state pollution control board, which is empowered
to establish standards and conditions that are required to be complied with. In certain cases, the state pollution control
board may cause the local magistrates to restrain the activities of such person who is likely to cause pollution. Penalty
for the contravention of the provisions of the Water Act include imposition of fines and/or imprisonment.
Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016, (“Hazardous Wastes
Rules”)
The Hazardous Wastes Rules impose an obligation on every occupier of a facility generating hazardous waste to
deploy safe and environmentally sound measures for handling of hazardous waste generated at such facility. Every
person engaged in generation, processing, treatment, packaging, storage, transportation, use, collection, destruction,
conversion, offering for sale and transfer of hazardous waste, must obtain an approval from the applicable state
pollution control board. The occupier, the importer, the transporter and the operator of disposal facility are liable for
damages to the environment or third party resulting from the improper handling and disposal of hazardous waste.
Public Liability Insurance Act, 1991 (“Public Liability Act”)
The Public Liability Act imposes liability on the owner or controller of hazardous substances for any damage arising
out of an accident involving such hazardous substance. A list of hazardous substances covered by the Public Liability
Act has been enumerated by the Government of India by way of a notification. The owner or handler is also required
to take out an insurance policy insuring against liability under the legislation. The rules made under the Public Liability
145
Act mandate that the employer has to contribute a sum equal to the premium paid on the insurance policies towards
the environment relief fund.
The Explosives Act, 1884 (the “Explosives Act”) and the Explosives Rules, 2008
The Explosives Act regulates the manufacture, possession, use, sale, transport and importation of explosives and
provides for rules to be made thereunder. The Explosives Act requires persons engaged in the business of manufacture, sale, transport, import or export of any explosives to obtain a licence for the same from the Central
Government. Under the provisions of the Explosives Act, the Central Government has the power to prohibit the manufacture, possession or importation of specially dangerous explosives.
Indian Forest Act, 1927
The Indian Forest Act, 1927 was largely based on previous Indian Forest Acts implemented under the British. The
most famous one was the Indian Forest Act of 1878. Both the 1878 act and the 1927 one sought to consolidate and
reserve the areas having forest cover, or significant wildlife, to regulate movement and transit of forest produce, and
duty leviable on timber and other forest produce. It also defines the procedure to be followed for declaring an area to
be a Reserved Forest, a Protected Forest or a Village Forest. It defines what a forest offence is, what are the acts
prohibited inside a Reserved Forest, and penalties leviable on violation of the provisions of the Act.
Other Applicable Laws
Trade Marks Act, 1999 (“Trade Marks Act”)
The Trade Marks Act provides for the application and registration of trademarks in India. The purpose of the Trade
Marks Act is to grant exclusive rights to marks such as a brand, label and heading, and to obtain relief in case of
infringement of such marks. An application for the registration of trademarks has to be made to Controller-General of
Patents, Designs and Trade Marks who is the Registrar of Trade Marks for the purposes of the Trade Marks Act. It
also provides for penalties for infringement, falsifying, and falsely applying trademarks and using them to cause
confusion among the public.
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BOARD OF DIRECTORS AND SENIOR MANAGEMENT
Board of Directors
As per our Articles of Association, we must have a minimum of three and maximum of 14 Directors. At present, the
Board consists of two Executive Directors (including the Chairman and Managing Director), two Government
Nominee Directors and four Independent Directors. As the Chairman of our Board is an Executive Director, we have
the requisite number of independent directors on our Board (i.e. 50% of the Board). However, our Board does not
currently have a woman director.
The Directors of the Company are not required to hold any Equity Shares to qualify to be a Director. Subject to the
provisions of the Companies Act, the President of India, in terms of our Articles of Association, is entitled to appoint
all Directors.
The following table sets forth details regarding the Board of Directors of the Company as on the date of this Placement
Document.
# Name, Address, Occupation, DIN, Term,
Date of Birth and Nationality Age (in years) Designation
1. Arun Kumar Shukla
Address: 2D, Merlin Cambridge Apartment,
24, Prince Anwar Shah Road, Kolkata -
700033, West Bengal
Occupation: Service
DIN: 03324672
Term: From January 1, 2020 till the date of his
superannuation i.e. July 31, 2023 or until
further orders by the Ministry of Mines,
Government of India, whichever is the earliest
Date of Birth: July 7, 1963
Nationality: Indian
57 Chairman and Managing Director
2. Sukhen Kumar Bandyopadhyay
Address: Ekta Heights, 7th Floor, Flat No. 7B,
Tower No.3, 56 Raja S C Mullick Road, P S
Jadaavpur, Kolkata-700032, West Bengal
Occupation: Service
DIN: 08173882
Term: Five years with effect from July 9, 2018,
or till the date of his superannuation, or until
further orders by the Ministry of Mines,
Government of India, whichever is the earliest
Date of Birth: November 19, 1961
Nationality: Indian
59 Director (Finance) and Chief
Financial Officer
3. Alok Chandra
52 Government Nominee Director
147
# Name, Address, Occupation, DIN, Term,
Date of Birth and Nationality Age (in years) Designation
Address: 3, Saini Enclave, Karkardooma, New
Delhi – 110 092
Occupation: Government Servant (IES)
DIN: 06929789
Term: With effect from June 22, 2018, until
further orders from the Ministry of Mines,
Government of India.
Date of Birth: April 24, 1968
Nationality: Indian
4. Sanjeev Verma
Address: Flat No. A-3, Tower 11, Type V, East
Kidwai Nagar, New Delhi -110023
Occupation: Government service
DIN: 08836996
Term: With effect from August 7, 2020, until
further orders from the Ministry of Mines,
Government of India.
Date of Birth: March 26, 1979
Nationality: Indian
42 Government Nominee Director
5. Subhash Sharma
Address: 439, Phase-4, Mohali, Punjab, PIN-
160059
Occupation: Academician
DIN:05333124
Term: For a period of three years from July 18,
2018 or until further orders by the Ministry of
Mines, Government of India, whichever is
earlier.
Date of Birth: February 28, 1978
Nationality: Indian
43 Independent Director
6. R Kalyansundaram
Address: 3, Ramasamy Naidu Nagar
Extension, Vilankurichi Road, Coimbatore
North Coimbatore, Tamil Nadu- 641035
Occupation: Industrialist
DIN: 08518006
57 Independent Director
148
# Name, Address, Occupation, DIN, Term,
Date of Birth and Nationality Age (in years) Designation
Term: For a period of three years from July 22,
2019 or until further orders by the Ministry of
Mines, Government of India, whichever is
earlier.
Date of Birth: May 6, 1963
Nationality: Indian
7. Pawan Kumar Dhawan
Address: C-57, Sector-M, Aliganj, Lucknow,
Uttar Pradesh –22602
Occupation: Practicing Chartered Accountant
DIN: 07327568
Term: For a period of three years from July 22,
2019 or until further orders by the Ministry of
Mines, Government of India, whichever is
earlier.
Date of Birth: July 15, 1964
Nationality: Indian
56 Independent Director
8. Balwinder Singh Canth
Address: G-901, Falcon View, Sector 66A,
Mohali, Punjab - 140306
Occupation: Retired Director (Marketing),
Indian Oil Corporation Limited
DIN: 07239321
Term: For a period of three years from July 22,
2019 or until further orders by the Ministry of
Mines, Government of India, whichever is
earlier.
Date of Birth: January 26, 1958
Nationality: Indian
63 Independent Director
Brief Biography of Directors
Arun Kumar Shukla is the Chairman and Managing Director of our Company. He is a graduate mining engineer of
the 1985 batch from the Indian School of Mines, Dhanbad. He holds a bachelor’s degree in law from Ranchi
University and a Master’s degree in Environmental Science & Engineering from Indian School of Mines, Dhanbad.
He has previously worked with Central Coalfields Limited and NMDC Limited. He was the chief executive officer
of NMDC Limited. He has been associated with our Company since October 1, 2018. He was Director (Operations)
of the Company from October 1, 2018 to December 31, 2019. He is also Managing Director of Chhattisgarh Copper
Ltd and Director of Khanij Bidesh India Limited.
149
Sukhen Kumar Bandyopadhyay is the Director (Finance) and Chief Financial Officer of our Company. He holds a
bachelor’s degree in science from University of Calcutta, and is also a qualified cost accountant. He has previously
worked with SJVN Limited. He has been associated with our Company since July 9, 2018. He is also Director on the
Board of Chhattisgarh Copper Limited.
Alok Chandra is a Government Nominee Director of our Company. He holds a bachelor’s degree in Economics from
University of Delhi and also master degree in Economics from Jawaharlal Nehru University. He is an officer of the
Indian Economic Service (IES) 1992 batch. He has previously worked in the Department of Economic Affairs (Capital
Market Division), Department of Expenditure of the Ministry of Finance, Ministry of Petroleum and Natural Gas,
Department of Consumer Affairs and Ministry of Railways. He is also a director on the board of Bharat Aluminium
Company Limited (BALCO). He is presently an economic adviser in the Ministry of Mines, Government of India. He
has been associated with our Company since June 22, 2018.
Sanjeev Verma is a Government Nominee Director of our Company. He holds a bachelor’s degree in civil
engineering from Malaviya Regional Engineering College, Jaipur (University of Rajasthan). He is an officer of the
Indian Railways Stores Service (IRSS) (Batch of 2002). He has previously worked in the Indian Railways. He is
presently a director in the Ministry of Mines, Government of India. He has been associated with our Company
sinceAugust 7, 2020.
Subhash Sharma is an Independent Director of our Company. He holds a bachelor’s degree in science (agriculture)
from Guru Nanak Dev University, bachelor’s degree in law Desh Bhagat University and a master’s degree in
economics from Guru Nanak Dev University. He also holds a doctoral degree from Punjabi University, Patiala. He
has previously worked as Assistant Professor in the subject of Economics in DAV College Amritsar. He is also
Director on the Board of Council of Global Punjabis. He has been associated with our Company since July 18, 2018.
R Kalyansundaram is an Independent Director of our Company. He holds a bachelor’s degree in mechanical
engineering from Bharathiar University and a master’s degree in business administration from Bharathidasan
University. He has been associated with our Company since July 22, 2019.
Pawan Kumar Dhawan is an Independent Director of our Company. He holds a bachelor’s degree in commerce
from Lucknow University. He is also a fellow member of the Institute of Chartered Accountants of India and associate
member of the Institute of Cost Accountants of India. He is a practicing Chartered Accountant by profession since
1990. He has been associated with our Company since July 22, 2019.
Balwinder Singh Canth is an Independent Director of our Company. He holds a bachelor’s degree in Law from
University of Delhi and a master’s degree in Personnel Management & Industrial Relations from Punjab University.
He was the Director (Marketing) at Indian Oil Corporation Limited. He has been associated with our Company since
July 22, 2019.
Nature of relationship between Directors
None of our Directors are related to each other.
Borrowing Powers of the Board
Pursuant to the resolution dated October 29, 2020, our Board is authorised to borrow money from single/ consortium
banks/other banks or institutions in India or foreign, for and on behalf of the Company across various products
including by way of overdraft or cash credit, working capital demand loan, commercial paper, bill discounting, other
loan arrangements, for all tenors, by whatever name called or otherwise, from time to time, as deemed to be requisite
and proper for the business of the Company including capex/ expansion projects, on such terms and conditions as the
Board may determine, as may be permitted by law from time to time, notwithstanding that the monies to be borrowed
together with the moneys already borrowed by the Company including temporary loans obtained from the Company's
bankers in the ordinary course of business, will or may exceed the aggregate of the paid-up capital of the Company
and its free reserves, provided that the total amount upto which the monies may be borrowed by the Board and/or the
Committee of Directors and outstanding at any time shall not exceed the sum of Rs. 250,000 lakhs only together with
interest.
150
Interest of Directors
All of our Independent Directors may be deemed to be interested to the extent of fees payable to them for attending
Board or committee meetings as well as to the extent of reimbursement of expenses payable to them. The Executive
Directors of our Company may also be deemed interested to the extent of remuneration paid to them for services
rendered.
All Directors may also be regarded as interested in the Equity Shares held by, or subscribed by and allotted to, the
companies, firms and trust, in which they are interested as directors, members, partners or trustees.
Our Directors may be deemed to be interested in the contracts, agreements or arrangements entered into or to be
entered into by our Company with any partnership firm in which they are partners or a body corporate in which a
director along with any other director holds more than two percent shareholding or is a promoter, manager or chief
executive officer. For further details, please see section titled “Financial Statements” on page 204.
Except as otherwise stated in this Placement Document, we have not entered into any contract, agreement or
arrangement during the preceding two years from the date of this Placement Document in which any of our Directors
are or is interested, directly or indirectly, and no payments have been made to them in respect of any such contracts,
agreements, arrangements which are proposed to be made with them.
As on the date of this Placement Document, none of the Directors has availed of any loan from our Company.
Shareholding of the Directors in our Company
As on the date of this Placement Document, none of the Directors hold any shares in our Company.
Terms of appointment and compensation of our Directors
Government Nominee Directors and Independent Directors
Pursuant to a resolution of our Board dated June 1, 2020, our Independent Directors are entitled to receive sitting fees
of Rs. 0.25 lakhs for attending each meeting of the Board and Rs. 0.20 lakhs for attending each meeting of the
committees.
Our Government Nominee Directors are not entitled to receive any remuneration or sitting fees from our Company.
They are only eligible for travelling, boarding & lodging expenses for attending meetings.
The following table sets forth the remuneration paid by our Company to the Independent Directors during the current
Fiscal (until the quarter ended December 31, 2020) and the last three Fiscals:
(in Rs. Lakhs)
Name Fiscal 2021* Fiscal 2020 Fiscal 2019 Fiscal 2018
Subhas Sharma 3.35 2.85 1.50 -
R. Kalyansundaram 3.55 1.65 - -
Pawan Kumar Dhawan 3.35 1.50 - -
Balwinder Singh Canth 2.95 1.35 - -
*upto December 31, 2020
Executive Directors
(i) Arun Kumar Shukla
Arun Kumar Shukla was appointed as the Chairman and Managing director of our Company on January 1, 2020 till
the date of his superannuation i.e. July 31, 2023 or until further orders, whichever is the earliest. The terms of his
appointment are given below:
151
Term Period of his appointment will be till July 31, 2023 i.e. the date of his superannuation in
the first instance or until further orders, whichever event occurs earlier and in accordance
with the provisions of Companies Act, 2013 as amended from time to time.
The appointment may, however, be terminated even during this period by either side on
three months’ notice or on payment of three months’ salary in lieu thereof.
Pay Pay scale of Rs. 2,00,000 -3,70,000 /-
Headquarters His headquarters will be at Kolkata where the registered office/ Corporate Office/
headquarters of the CPSE is located. He will be liable to serve in any part of the country
at the discretion of the CPSE.
Dearness Allowance Dearness allowance would be paid in accordance with the new IDA scheme spelt out in
the DPE’s O.M. dated August 3, 2017.
House rent allowance He will be entitled to House Rent Allowance as per the rates indicated in OMs dated
August 3, 2017 and August 4, 2017.
Annual Increment He will be eligible to draw his annual increment at 3% of basic pay on the anniversary
date of his appointment in the scale and further increments on the same date in
subsequent years until the maximum of pay scale is reached. After reaching the
maximum of the pay scale, one stagnation increment equal to the rate of last increment
drawn will be granted after completion of every two-year period from the date he reaches
the maximum of his pay scale provided he gets a performance rating of “Good” or above.
He will be granted a maximum of three such stagnation increments.
Conveyance He will be entitled to the facility of staff car for private use as indicated below, in terms
of DPE OMs dated January 21,2013 and November 4, 2013
Name of the city Ceiling on non – duty journeys
Delhi, Mumbai, Kolkata, Chennai,
Bengaluru, Hyderabad
All other cities
1000 km per month
750 km per month
Monthly rate of recovery for private use/ non-duty journeys would be Rs. 2000/- per
month.
Performance related
payment
He shall be eligible for approved PRP as O.M. dated August 3, 2017.
Other
Allowances/Perks and
superannuation
benefits
The Board of Directors will decide on the allowances and perks subject to a ceiling of
35% of his basic pay as indicated in OMs dated August 3, 2017 and August 4, 2017 and
September 7, 2017.
He shall be eligible for superannuation benefit based on approved schemes as per O.M
dated August 3, 2017.
Leave He will remain subject to the leave rules of the CPSE.
Restriction on joining
private commercial
undertakings after
retirement/resignation
After retirement/resignation from the service of the CPSE, he shall not accept any
appointment or post, whether advisory or administrative, in any firm or company
whether Indian or foreign, with which the CPSE has or had business relations, within
152
one year from the date of his retirement/resignation, without prior approval of the
Government.
Conduct, discipline
and appeal rules
The Conduct, discipline and Appeal Rules framed by the CPSE in respect of their below
board level executives would also mutatis mutandis apply to him with the modification
that the Disciplinary Authority in his case would be the President of India.
The Government also reserves the right not to accept his resignation, if the circumstances
so warrant i.e. the disciplinary proceedings are pending or a decision has been taken by
the competent authority to issue a charge sheet to him.
(ii) Sukhen Kumar Bandyopadhyay
Sukhen Kumar Bandyopadhyay was appointed as the Director (Finance) of our Company for a term of five years with
effect from July 9, 2018, or till the date of his superannuation, or until further orders, whichever is the earliest. The
terms of his re-appointment are given below:
Term Period of five years with effect from July 9, 2018 in the first instance or till the age of
superannuation or until further orders, whichever is earlier and in accordance with the
provisions of Companies Act, 2013 as amended from time to time.
The appointment may, however, be terminated even during this period by either side on
three months’ notice or on payment of three months’ salary in lieu thereof.
Pay Pay scale of Rs. 1,80,000 -3,40,000 /-
Headquarters His headquarters will be at Kolkata where the registered office/ Corporate Office/
headquarters of the CPSE is located. He will be liable to serve in any part of the country
at the discretion of the CPSE.
Dearness Allowance Dearness allowance would be paid in accordance with the new IDA scheme spelt out in
the DPE’s O.M. dated August 3, 2017.
House rent allowance He will be entitled to House Rent Allowance as per the rates indicated in OMs dated
August 3, 2017 and August 4, 2017.
Annual Increment He will be eligible to draw his annual increment at 3% of basic pay on the anniversary
date of his appointment in the scale and further increments on the same date in
subsequent years until the maximum of pay scale is reached. After reaching the
maximum of the pay scale, one stagnation increment equal to the rate of last increment
drawn will be granted after completion of every two-year period from the date he reaches
the maximum of his pay scale provided he gets a performance rating of “Good” or above.
He will be granted a maximum of three such stagnation increments.
Conveyance He will be entitled to the facility of staff car for private use as indicated below, in terms
of DPE OMs dated January 21,2013 and November 4, 2013
Name of the city Ceiling on non – duty journeys
Delhi, Mumbai, Kolkata, Chennai,
Bengaluru, Hyderabad
All other cities
1000 km per month
750 km per month
153
Monthly rate of recovery for private use/ non-duty journeys would be Rs. 2000/- per
month.
Performance related
payment
He shall be eligible for approved PRP as O.M. dated August 3, 2017.
Other
Allowances/Perks and
superannuation
benefits
The Board of Directors will decide on the allowances and perks subject to a ceiling of
35% of his basic pay as indicated in OMs dated August 3, 2017 and August 4, 2017 and
September 7, 2017.
He shall be eligible for superannuation benefit based on approved schemes as per O.M
dated August 3, 2017.
Leave He will remain subject to the leave rules of the CPSE.
Restriction on joining
private commercial
undertakings after
retirement/resignation
After retirement/resignation from the service of the CPSE, he shall not accept any
appointment or post, whether advisory or administrative, in any firm or company
whether Indian or foreign, with which the CPSE has or had business relations, within
one year from the date of his retirement/resignation, without prior approval of the
Government.
Conduct, discipline
and appeal rules
The Conduct, discipline and Appeal Rules framed by the CPSE in respect of their below
board level executives would also mutatis mutandis apply to him with the modification
that the Disciplinary Authority in his case would be the President of India.
The Government also reserves the right not to accept his resignation, if the circumstances
so warrant i.e. the disciplinary proceedings are pending or a decision has been taken by
the competent authority to issue a charge sheet to him.
The following table sets forth the compensation paid by our Company to the Executive Directors during the current
Fiscal (until the quarter ended on December 31, 2020) and the last three Fiscals: (in Rs. Lakhs)
Name of Directors Fiscal 2021* Fiscal 2020 Fiscal 2019 Fiscal 2018
Arun Kumar Shukla 37.97 48.07 21.92 -
Sukhen Kumar
Bandyopadhyay
40.15 52.41 32.55 -
*upto December 31, 2020
Key Managerial Personnel
Apart from the Executive Directors (including the Director (Finance), who is also the Chief Financial Officer), whose
details are set out herein above, the following are the other Key Managerial Personnel:
# Name Age (in years) Designation
1. C. S. Singhi 57 Company Secretary and Compliance
Officer
Brief profiles of our Key Managerial Personnel
For the brief profiles of our Executive Directors and our Chief Financial Officer, see “Brief Biographies of Directors”
beginning on page 148.
C. S. Singhi is our Company Secretary and Compliance Officer. He holds a bachelor’s degree in commerce from
Calcutta University and is a fellow member of the Institute of Company Secretaries of India. He joined our Company
on July 1, 1996 and is responsible for the board, statutory and company matters. Prior to joining our Company, he
worked with Darjeeling Dooars Plantations (Tea) Limited, Nihon Nirman Limied and Tyroon Tea Company Limited
as a company secretary. His gross remuneration for Fiscal 2020 was Rs. 51.28 lakhs and Rs. 36.24 lakhs for Fiscal
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2021 (upto December 31, 2020) .
Shareholding details of the Key Managerial Personnel
As on the date of this Placement Document, none of the Key Managerial Personnel hold any shares in our Company.
Interest of the Key Managerial Personnel
Except as disclosed above in relation to our Directors under “– Interests of Directors” on page 150, the Key Managerial
Personnel do not have any other interest in our Company other than to the extent of the remuneration or benefits to
which they are entitled to as per their terms of appointment, reimbursement of expenses incurred by them during the
ordinary course of business and to the extent of the Equity Shares of the Company held by their dependents.
Corporate governance
Section 149 of the Companies Act, 2013 and Regulation 17(1) of SEBI Listing Regulations, requires our Company to
have at least one woman Director on its Board. However, with effect from November 16, 2019, the Board of the
Company does not have any woman Director. Accordingly, our Board is currently not in compliance with Section 149
of the Companies Act and Regulation 17 of the SEBI Listing Regulations. For further details, please see the section
titled “Risk Factors – Our Company does not have a woman Director on the Board as required under Section 149 of
the Companies Act, 2013 and Regulation 17(1) of SEBI Listing Regulations and accordingly, penalties have been
imposed upon us.” beginning on page 53.
Pursuant to a MCA notification dated June 5, 2015, the Central Government has exempted/ modified the applicability
of certain provisions of the Companies Act, 2013 in respect of Government Companies. Further, in accordance with
the DPE Guidelines on Corporate Governance for Central Public Sector Enterprises and pursuant to our Articles,
matters pertaining to, among others, appointment, remuneration and performance evaluation of our Directors are
determined by the President of India. Further, our Statutory Auditor is appointed by the Comptroller and Auditor
General of India. Accordingly, the terms of reference of our Nomination and Remuneration Committee and Audit
Committee does not cover above.
Other than as described above, our Company is in compliance with corporate governance norms prescribed under
SEBI Listing Regulations, including in relation to the composition of its committees.
Committees of the Board of Directors
As on the date of this Placement Document, we have two Executive Directors, two Government Nominee Directors
and four Independent Directors. In line with the requirements of the provisions of the Companies Act and the
provisions of Chapter IV of the SEBI Listing Regulations, our Board has constituted various committees as detailed
below. Their constitution is for a more specific and focused approach towards some of the important functional areas
of the Company’s operations, for providing recommendations for effective monitoring and controlling the affairs of
our Company. The committees, in compliance with statutory requirements, meet at regular intervals. The Board also
takes note of minutes of the meetings of the committees duly approved by their respective chairman and the material
recommendations/decisions of the committees are placed before the Board for approval/information. The committees
are as follows:
a) Audit Committee;
b) Nomination and Remuneration Committee;
c) Stakeholders’ Relationship Committee;
d) Corporate Social Responsibility Committee; and
e) Risk Management Committee;
The following table sets forth the members of the aforesaid committees as of the date of this Placement Document:
# Name of Committee Members
1. Audit Committee Pawan Kumar Dhawan (Chairman)
R Kalyansundaram
Subhash Sharma
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# Name of Committee Members
2. Nomination and Remuneration Committee Subhash Sharma (Chairman)
Balwinder Singh Canth
R Kalyansundaram
3. Stakeholders’ Relationship Committee R Kalyansundaram (Chairman)
Subhash Sharma
Sukhen Kumar Bandyopadhyay
4. Corporate Social Responsibility Committee Balwinder Singh Canth (Chairman)
Pawan Kumar Dhawan
Sukhen Kumar Bandyopadhyay
5. Risk Management Committee Director (Mining) (Chairman)
Director (Finance)
Director (Operations)
R. Kalyansundaram
Balwinder Singh Canth
Head of M&C, CO
Policy on disclosures and internal procedure for prevention of insider trading
Pursuant to the provisions of Chapter IV of the SEBI Insider Trading Regulations our Company is required to
implement codes of fair disclosure and conduct for the prevention of insider trading. Our Company has implemented
a code of conduct for prevention of insider trading in accordance with the SEBI Insider Trading Regulations.
156
Organization Structure of our Company
Other confirmations
No action has been initiated under Insolvency and Bankruptcy Code, 2016, against any of the Directors.
None of the Directors have been declared as a fugitive economic offender as per the provisions on Section 12 of the
Fugitive Economic Offenders Act, 2018.
None of the Directors, or our KMP have any financial or other material interest in this Issue.
Neither our Company, nor our Directors have been identified as wilful defaulters, as defined in the SEBI ICDR
Regulations.
None of the Directors or the companies with which they are or were associated as promoters, directors or persons in
control have been debarred from accessing the capital market under any order or direction passed by SEBI or any
other governmental authority.
Related Party Transactions
For details in relation to the related party transactions entered by our Company during the last three Fiscal Years and
the nine month period ended December 31, 2020, as per the requirements under Indian Accounting Standard 24 issued
by the Institute of Chartered Accountants in India, please see section titled “Financial Statements” on page 204.
Chairman and Managing Director
Director (Finance &CFO)
Director (Mining) Director (Operations)
ED (Company Secretrary)
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PRINCIPAL SHAREHOLDERS
The summary statement showing the holding of specified securities of our Company as of March 31, 2021, is herein
below:
Category of
the
shareholder
No. of
shareholders
No. of fully
paid up
equity shares
held
Total no.
shares
held
Shareholding
as a %
of total no. of
shares
(calculated as
per
SCRR, 1957)
As a %
of (A+B+C2)
Number of
voting rights
Total
as %
of
total
voting
right
No. of equity
shares held in
dematerialized
form
(A) Promoter & Promoter
Group 1 70,35,87,852 70,35,87,852 76.05 70,35,87,852 76.05 70,35,87,852
(B) Public 1,63,635 22,16,30,148 22,16,30,148 23.95 22,15,65,533 23.95 22,15,96,085
(C1) Shares underlying
DRs - -
-
- - -
-
(C2) Shares held by
Employee
Trust - - - - - - -
(C) Non
Promoter-Non
Public (C)=(C1)+(C2) - - - - - - -
Grand Total =
(A) + (B) + (C) 1,63,636 92,52,18,000 92,52,18,000 100.00 92,51,53,385 100.00 92,51,83,937
(Source: www.bseindia.com)
The summary statement showing holding of specified securities of the Promoter in our Company as of March 31,
2021, is herein below:
Category of the
shareholder
No. of
shareholders
No. of fully paid up
equity shares
held
Total no.
shares
held
Shareholding as
a %
of total no. of
shares
(calculated as
per
SCRR, 1957) As
a %
of (A+B+C2)
No. of equity
shares held in
dematerialized
form
A1) Indian
Central Government / State
Government(s)
1 70,35,87,852 70,35,87,852 76.05 70,35,87,852
President of India 1 70,35,87,852 70,35,87,852 76.05 70,35,87,852
Sub Total A1 1 70,35,87,852 70,35,87,852 76.05 70,35,87,852
A2) Foreign - - - - -
A=A1+A2 1 70,35,87,852 70,35,87,852 76.05 70,35,87,852
(Source: www.bseindia.com)
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The summary statement showing holding of specified securities of public shareholders in our Company as of March
31, 2021, is herein below:
Category & Name of the
Shareholder
No. of
sharehold
er
No. of fully paid
up
equity shares
held
Total no.
shares
held
Shareh
olding
%
calcula
ted as
per
SCRR,
1957
As a %
of
(A+B+
C2)
No. of
voting
rights
Total
as a
% of
total
votin
g
rights
No. of equity
shares held in
dematerialized
form (Not
applicable)
B1) Institutions
Mutual Funds 4 1,67,628 1,67,628 0.02 1,67,628 0.02 1,67,628
Foreign Portfolio Investors 11 65,76,725 65,76,725 0.71 65,76,725 0.71 65,76,725
Financial Institutions/
Banks
5
51,02,703 51,02,703 0.55 51,02,703 0.55 51,02,703
Insurance Companies 6 11,19,00,730 11,19,00,730 12.09 11,19,00,730 12.09 11,19,00,730
Life Insurance Corporation
of India
1
10,56,85,666 10,56,85,666 11.42 10,56,85,666 11.42 10,56,85,666
Sub Total B1 26 12,37,47,786 12,37,47,786 13.37 12,37,47,786 13.37 12,37,47,786
B2) Central Government/
State Government(s)/
President of India
0 0 0 0.00 0.00
B3) Non-Institutions 0 0 0 0.00 0.00
Individual share capital
upto Rs. 2 Lacs 1,60,713 6,51,77,751 6,51,77,751 7.04 6,51,77,751 7.04 6,51,47,888
Individual share capital
in excess of Rs. 2 Lacs 86 2,01,18,856 2,01,18,856 2.17 2,01,18,856 2.17 2,01,18,856
Any Other (specify)
Bodies Corporate 847 96,83,368 96,83,368 1.05 96,83,368 1.05 96,79,168
Non-Resident Indian (NRI) 1,953 27,14,247 27,14,247 0.29 27,14,247 0.29 27,14,247
Trusts 9 1,23,525 1,23,525 0.01 1,23,525 0.01 1,23,525
IEPF 1 64,615 64,615 0.01 0* 0.00 64,615
Sub Total B3 1,63,609 9,78,82,362 9,78,82,362 10.58 9,78,17,747 10.58 9,78,48,299
B=B1+B2+B3 1,63,635 22,16,30,148 22,16,30,148 23.95 22,15,65,533 23.95 22,15,96,085
(Source: www.bseindia.com)
*The voting rights on shares transferred to IEPF remain frozen until the rightful owner claims the Equity Shares.
The summary statement showing holding of specified securities of non-Promoter non-public shareholders in our Company as of
March 31, 2021, is herein below:
Category and
name
of the
shareholders (I)
No. of
Shareholder (III)
No. of fully
paid up
equity
shares
held (IV)
Nos. of shares
underlying
Depository
Receipts(VI)
Total no.
shares
Held (VII =
IV+V+VI)
Shareholding %
calculated as per
SCRR, 1957 As a
%
of (A+B+C2)
(VIII)
Number of equity
shares held in
dematerialized
form (XIV) (Not
Applicable)
Custodian/DR
holder (C1)
0 0 - - 0.00 -
Custodian/DR
holder
0 0 - - 0.00 -
Sub Total C1 0 0 - - 0.00 -
Employee benefit trust (C2)
0 0 - - 0.00 -
C= C1 + C2 0 0 - - 0.00 -
(Source: www.bseindia.com)
Details of disclosures made by the trading members holding 1% or more of the total no. of Equity Shares of the
Company: Nil
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ISSUE PROCEDURE
The following is a summary intended to present a general outline of the procedure relating to the application, payment
of Application Amount, Allocation and Allotment. The procedure followed in the Issue may differ from the one
mentioned below, and investors are assumed to have apprised themselves of the same from our Company or the Book
Running Lead Managers. Investors are advised to inform themselves of any restrictions or limitations that may be
applicable to them. Also, please see the sections titled “Selling Restrictions” and “Transfer Restrictions” on pages
174 and 182, respectively.
Our Company, the Book Running Lead Managers and their respective directors, officers, agents, advisors,
shareholders, employees, counsels, affiliates and representatives are not liable for any amendment or modification or
change to applicable laws or regulations, which may occur after the date of this Placement Document. Eligible QIBs
are advised to make their independent investigations and satisfy themselves that they are eligible to apply. Eligible
QIBs are advised to ensure that any single Bid from them does not exceed the investment limits or maximum number
of Equity Shares that can be held by them under applicable law or regulation or as specified in this Placement
Document. Further, Eligible QIBs are required to satisfy themselves that their Bids would not result in triggering an
open offer under the SEBI Takeover Regulations and shall be solely responsible for compliance with all the applicable
provisions of the SEBI Takeover Regulations, the SEBI Insider Trading Regulations, and other applicable laws.
Qualified Institutions Placement
THE ISSUE IS MEANT ONLY FOR ELIGIBLE QIBs ON A PRIVATE PLACEMENT BASIS AND IS NOT
AN OFFER TO THE PUBLIC OR TO ANY OTHER CLASS OF INVESTORS.
This Placement Document has not been, and will not be, filed as a prospectus with the RoC and, no Equity Shares will
be offered in India or overseas to the public or any members of the public or any other class of investors, other than
Eligible QIBs.
The Issue is being made to Eligible QIBs in reliance upon Chapter VI of the SEBI ICDR Regulations and Section 42
and other applicable provisions of the Companies Act, through the mechanism of a Qualified Institutions Placement
(“QIP”). Under Chapter VI of the SEBI ICDR Regulations and Section 42 of the Companies Act and other applicable
provisions of the Companies Act, a company, being a listed company in India may issue equity shares to Eligible
QIBs, provided that certain conditions are met:
• the Shareholders have passed a special resolution approving the Issue. Such special resolution must inter alia
specify (a) that the Allotment is proposed to be made pursuant to the QIP; and (b) the Relevant Date;
• the explanatory statement to the notice to the Shareholders for convening the general meeting must disclose
amongst other things, the particulars of this Issue including the date of passing the board resolution, the kind
of securities being offered and the price at which they are offered, amount which the company intends to raise
by way of such securities and the material terms of raising such securities, proposed Issue schedule, the purpose
or objects of this Issue, the contribution made by the Promoter or Directors either as part of this Issue or
separately in furtherance of the objects, and the basis or justification for the price (including premium, if any)
at which the offer or invitation is being made;
• under Regulation 172(1)(b) of the SEBI ICDR Regulations, the Equity Shares of the same class of our
Company, which are proposed to be Allotted through this Issue, are listed on the Stock Exchanges, for a period
of at least one year prior to the date of issuance of notice to our Shareholders for convening the meeting to seek
the approval the above-mentioned special resolution;
• invitation to apply in the Issue must be made through a private placement offer-cum-application (i.e., the
Preliminary Placement Document) and Application Form serially numbered and addressed specifically to the
Eligible QIBs to whom this Issue is made either in writing or in electronic mode, within 30 days of recording
the name of such person in accordance with applicable law;
• our Company shall have completed allotments with respect to any earlier offer or invitation made by our
Company or shall have withdrawn or abandoned such invitation or offer made by our Company; however, our
Company may, at any time, make more than one issue of securities to such class of identified persons as may
160
be permitted under applicable law; and
• our Directors are not fugitive economic offenders.
For details in relation to the Preferential Issue, please see attached the section titled “Capital Structure” on page 72.
In accordance with the SEBI ICDR Regulations, the Equity Shares will be issued and Allotment shall be made only
in dematerialized form to the Allottees.
At least 10% of the Equity Shares issued to Eligible QIBs was available for Allocation to Mutual Funds, provided
that, if this portion or any part thereof to be Allotted to Mutual Funds remains unsubscribed, it may be Allotted to
other Eligible QIBs.
Bidders are not allowed to withdraw or revise downwards their Bids after the Issue Closing Date.
Additionally, there is a minimum pricing requirement under the SEBI ICDR Regulations. The Floor Price of the Equity
Shares offered under this Issue shall not be less than the average of the weekly high and low of the closing prices of
the Equity Shares of the same class quoted on the Stock Exchanges during the two weeks preceding the Relevant Date
as calculated in accordance with Chapter VI of the SEBI ICDR Regulations.
The “Relevant Date” referred to above means the date of the meeting in which the Board of the Company decides to
open this Issue and “stock exchange” means any of the recognized stock exchanges on which the Equity Shares of the
same class are listed and on which the highest trading volume in such Equity Shares has been recorded during the two
weeks immediately preceding the Relevant Date. Further, in accordance with the special resolution passed by our
Shareholders by way of a postal ballot on January 28, 2021, our Company may offer a discount of not more than 5%
on the Floor Price in accordance with the SEBI ICDR Regulations.
The Equity Shares will be Allotted within 365 days from the date of the shareholders’ resolution approving the Issue
and within 60 days from the date of receipt of Application Amount from the Successful Bidders. For details of refund
of Application Amount, please see the section titled “– Pricing and Allocation – Designated Date and Allotment of
Equity Shares” on page 170.
Subscription to the Equity Shares offered pursuant to the Issue must be made by Eligible QIBs on the basis of the
Preliminary Placement Document and the Placement Document. The Preliminary Placement Document and the
Placement Document shall contain all material information required under applicable law including the information
specified in Schedule VII of the SEBI ICDR Regulations and the requirements prescribed under Form PAS-4. The
Preliminary Placement Document and the Placement Document are private documents provided to only select Eligible
QIBs through serially numbered copies and are required to be placed on the website of the concerned Stock Exchanges
and of our Company with a disclaimer to the effect that it is in connection with an issue to Eligible QIBs and no offer
is being made to the public or to any other category of investors. Please note that if you do not receive a serially
numbered copy of the Preliminary Placement Document addressed to you, you may not rely on the Preliminary
Placement Document or Placement Document uploaded on the website of the Stock Exchanges or our Company for
making an application to subscribe to Equity Shares pursuant to the Issue.
The Issue was approved by the Board of Directors on October 29, 2020. Subsequently, our Shareholders through a
special resolution passed by way of a postal ballot approved the Issue on January 28, 2021.
The minimum number of allottees with respect to a QIP shall not be less than:
• two, where the issue size is less than or equal to ₹ 25,000 lakhs; and
• five, where the issue size is greater than ₹ 25,000 lakhs.
No single Allottee shall be Allotted more than 50% of the Issue Size.
Eligible QIBs that belong to the same group or that are under common control shall be deemed to be a single Allottee
for the purpose of the Issue. For details of what constitutes “same group” or “common control”, please see the section
titled “—Bid Process—Application Form” on page 165.
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Equity Shares being Allotted pursuant to the Issue shall not be sold for a period of one year from the date of Allotment,
except on the floor of a recognised stock exchange.
The Equity Shares have not been and will not be registered under the Securities Act, or the securities laws of any state
of the United States and, unless so registered, may not be offered or sold within the United States, except pursuant to
an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable
U.S. state securities laws. The Equity Shares offered in the Issue are being offered and sold only outside the United
States in “offshore transactions”, as defined in and in reliance on Regulation S and the applicable laws of the
jurisdiction where those offers and sales are made. For further information, see “Selling Restrictions” and “Transfer
Restrictions” on pages 174 and 182, respectively.
The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other jurisdiction
outside India and may not be offered or sold, and Bids may not be made by persons in any such jurisdiction, except
in compliance with the applicable laws of such jurisdiction.
Our Company has filed a copy of the Preliminary Placement Document and will file a copy of the Placement Document
with each of the Stock Exchanges. Our Company has received in-principle approvals from each of the Stock
Exchanges under Regulation 28(1)(a) of the SEBI Listing Regulations for the listing of the Equity Shares to be issued
pursuant to this Issue on the Stock Exchanges on April 7, 2021. Our Company shall also make the requisite filings
with the RoC within the stipulated period as required under the Companies Act and the PAS Rules.
Issue Procedure
1. On Issue Opening Date, our Company and the Book Running Lead Managers, shall circulate serially numbered
copies of the Preliminary Placement Document and the serially numbered Application Form, either in electronic
or physical form, to identified Eligible QIBs and the Application Form will be specifically addressed to each
such Eligible QIB. In terms of Section 42(3) of the Companies Act, 2013, our Company shall maintain complete
records of the Eligible QIBs in the form and manner as prescribed under the PAS Rules, to whom the
Preliminary Placement Document and the serially numbered Application Form will be dispatched. Our
Company will make the requisite filings with the RoC within the stipulated time periods as required under the
Companies Act, 2013 and the PAS Rules.
2. The list of Eligible QIBs to whom the Preliminary Placement Document and Application Form is delivered will
be determined by our Company in consultation with the Book Running Lead Managers, at their sole discretion.
Unless a serially numbered Preliminary Placement Document along with the serially numbered
Application Form, which includes the details of the bank account wherein the Application Amount is to
be deposited, is addressed to a particular Eligible QIB, no invitation to make an offer to subscribe shall
be deemed to have been made to such Eligible QIB. Even if such documentation were to come into the
possession of any person other than the intended recipient, no offer or invitation to offer shall be deemed to
have been made to such person and any application that does not comply with this requirement shall be treated
as invalid.
3. Eligible QIBs may submit the Application Form, including any revisions thereof along with the Application
Amount and a copy of the PAN card or PAN allotment letter and/or any other documents mentioned in the
Application Form, during the Issue Period to the Book Running Lead Managers.
4. Bidders will be required to indicate the following in the Application Form:
• full official name of the Bidder to whom Equity Shares are to be Allotted, complete address, e-mail ID,
PAN, phone number and bank account details;
• number of Equity Shares Bid for;
• price at which they are agreeable to subscribe for the Equity Shares and the aggregate Application
162
Amount for the number of Equity Shares Bid for;
• details of the depository account to which the Equity Shares should be credited;
• Equity Shares held by the Eligible QIBs in our Company prior to the Issue; and
• a representation that it is outside the United States acquiring the Equity Shares in an offshore transaction
under Regulation S and the applicable laws of the jurisdiction where those offers and sales are made.
Note: Eligible FPIs are required to indicate the SEBI FPI registration number in the Application Form.
The Bids made by the asset management companies or custodians of Mutual Funds shall specifically
state the names of the concerned schemes for which the Bids are made. In case of a Mutual Fund, a
separate Bid can be made in respect of each scheme of the Mutual Fund registered with SEBI and such
Bids in respect of more than one scheme of the Mutual Fund will not be treated as multiple Bids provided
that the Bids clearly indicate the scheme for which the Bid has been made. Application by various
schemes or funds of a Mutual Fund will be treated as one application from the Mutual Fund. Bidders
are advised to ensure that any single Bid from them does not exceed the investment limits or maximum
number of Equity Shares that can be held by them under applicable laws.
5. Each Bidder shall be required to make the entire payment of the Application Amount for the Equity Shares Bid
for, along with the Application Form, only through electronic transfer to the Escrow Account opened in the
name of “HINDUSTAN COPPER LIMITED QIP ESCROW ACCOUNT” with the Escrow Agent, within the
Issue Period as specified in the Application Form sent to the respective Bidders. No payment shall be made by
Bidders in cash. Please note that any payment of Application Amount for the Equity Shares shall be made from
the bank accounts of the relevant Bidders and our Company shall keep a record of the bank account from where
such payment has been received. Application Amount payable on Equity Shares to be held by joint holders
shall be paid from the bank account of the person whose name appears first in the Application Form. Pending
Allotment and the filing of return of Allotment by our Company with the RoC, or receipt of final listing and
trading approvals from the Stock Exchanges, whichever is later, Application Amount received for subscription
of the Equity Shares shall be kept by our Company in a separate bank account with a scheduled bank and shall
be utilised only for the purposes permitted under the Companies Act, 2013. Notwithstanding the above, in the
event, among others, a Bidder was not Allocated Equity Shares in the Issue, or the number of Equity Shares
Allocated to the Bidder was lower than the number of Equity Shares applied for through the Application Form
and towards which Application Amount has been paid by such Bidder, or the Application Amount was in excess
of the amount equivalent to the product of the Equity Shares that have been Allocated to the Bidder and the
Issue Price, or the Application Amount has been arrived at using an indicative price higher than the Issue Price,
or any Bidder lowers or withdraws their Bid after submission of the Application Form but prior to the Issue
Closing Date, the excess Application Amount will be refunded to the same bank account from which it was
remitted, in the form and manner set out in “- Refunds” on page 170.
6. The Application Form may be signed physically or digitally, if required under applicable law in the relevant
jurisdiction applicable to each Eligible QIB and as permitted under such applicable law. An Eligible QIB may
submit an unsigned copy of the Application Form, as long as the Application Amount is paid along with
submission of the Application Form within the Issue Period. Once a duly completed Application Form is
submitted by a Bidder, whether signed or not and the Application Amount is transferred to the Escrow Account,
such application constitutes an irrevocable offer and the Bid cannot be withdrawn or revised downwards after
the Issue Closing Date. In case of an upward revision before the Issue Closing Date, an additional amount shall
be required to be deposited towards the Application Amount in the Escrow Account along with the submission
of such revised Bid. In case Bids are being made on behalf of the Eligible QIB and the Application Form is
unsigned, it shall be assumed that the person submitting the Application Form and providing necessary
instructions for transfer of the Application Amount to the Escrow Account, on behalf of the Eligible QIB is
authorised to do so. The Issue Closing Date shall be notified to the Stock Exchanges and the Eligible QIBs shall
be deemed to have been given notice of such date after receipt of the Application Form.
7. Upon receipt of the duly completed Application Form and the Application Amount in the Escrow Account, on
or after the Issue Closing Date, our Company shall, in consultation with Book Running Lead Managers,
determine the final terms, including (i) the Issue Price, (ii) the number of Equity Shares to be Allocated to each
Successful Bidder; and (iii) the Successful Bidders to whom such Equity Shares shall be Allocated. Upon such
determination, the Book Running Lead Managers will send the serially numbered CAN to Successful Bidders
163
who have been Allocated the Equity Shares. The dispatch of a CAN, and the Placement Document (when
dispatched) to a Successful Bidder shall be deemed a valid, binding and irrevocable contract for the Successful
Bidders to subscribe to the Equity Shares Allocated to such Successful Bidders at an aggregate price equivalent
the product of the Issue Price and Equity Shares Allocated to such Successful Bidders. The CAN shall contain
details such as the number of Equity Shares Allocated to the Successful Bidders, Issue Price and the aggregate
amount received towards the Equity Shares Allocated. Please note that the Allocation will be at the absolute
discretion of our Company and will be in consultation with the Book Running Lead Managers.
8. Upon determination of the Issue Price and before Allotment of Equity Shares to the Successful Bidders, the
Book Running Lead Managers, shall, on our behalf, send a serially numbered Placement Document either in
electronic form or through physical delivery to each of the Successful Bidders who have been Allocated Equity
Shares pursuant to dispatch of a serially numbered CAN.
9. Upon dispatch of the serially numbered Placement Document, our Company shall Allot Equity Shares as per
the details in the CANs sent to the Successful Bidders. Our Company will inform the Stock Exchanges of the
details of the Allotment.
10. After passing the resolution for Allotment and prior to crediting the Equity Shares into the beneficiary account
of the Successful Bidders maintained by the Depository Participant, as specified in the records of the
depositories or as indicated in their respective Application Form, our Company shall apply to the Stock
Exchanges for listing approvals in respect of the Equity Shares Allotted pursuant to the Issue.
11. After receipt of the listing approvals of the Stock Exchanges, our Company shall credit the Equity Shares
Allotted pursuant to this Issue into the beneficiary accounts of the respective Allottees.
12. Our Company will then apply for the final trading approvals from the Stock Exchanges.
13. The Equity Shares that would have been credited to the beneficiary account with the Depository Participant of
the Successful Bidders shall be eligible for trading on the Stock Exchanges only upon the receipt of final trading
and listing approvals from the Stock Exchanges.
14. As per applicable law, the Stock Exchanges will notify the final listing and trading approvals, which are
ordinarily available on their websites, and our Company may communicate the receipt of the listing and trading
approvals to those Eligible QIBs to whom the Equity Shares have been Allotted. Our Company and the Book
Running Lead Managers shall not be responsible for any delay or non-receipt of the communication of the final
trading and listing permissions from the Stock Exchanges or any loss arising from such delay or non-receipt.
Investors are advised to apprise themselves of the status of the receipt of the permissions from the Stock
Exchanges or our Company.
Eligible Qualified Institutional Buyers
Only Eligible QIBs are eligible to invest in the Equity Shares pursuant to the Issue, provided that with respect to
foreign portfolio investors, only Eligible FPIs applying under Schedule II of the FEMA Rules will be considered as
Eligible QIBs. Currently, QIBs, who are eligible to participate in the Issue and also as defined under Regulation
2(1)(ss) of the SEBI ICDR Regulations, are set forth below:
• alternate investment funds registered with SEBI;
• Eligible FPIs;
• insurance companies registered with Insurance Regulatory and Development Authority of India;
• insurance funds set up and managed by army, navy or air force of the Union of India;
• insurance funds set up and managed by the Department of Posts, India;
• multilateral and bilateral development financial institutions (which are resident in India);
• Mutual Funds;
• pension funds with minimum corpus of ₹ 2,500 lakhs;
• provident funds with minimum corpus of ₹ 2,500 lakhs;
• public financial institutions;
• scheduled commercial banks;
• state industrial development corporations;
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• the National Investment Fund set up by resolution no. F. No. 2/3/2005-DDII dated November 23, 2005 of the
Government published in the Gazette of India;
• venture capital funds registered with SEBI; and
• systemically important non-banking financial companies;
subject to such QIB not being excluded pursuant to Regulation 179(2)(b) of the SEBI ICDR Regulations.
NOTE: FVCIS AND NON-RESIDENT MULTILATERAL AND BILATERAL DEVELOPMENT
FINANCIAL INSTITUTIONS ARE NOT PERMITTED TO PARTICIPATE IN THE ISSUE.
Allotments made to VCFs and AIFs in the Issue are subject to the rules and regulations that are applicable to
each of them respectively, including in relation to lock-in requirement. VCFs and AIFs should independently
consult their own counsel and advisors as to investment in and related matters concerning the Issue.
ELIGIBLE FPIs ARE PERMITTED TO PARTICIPATE UNDER SCHEDULE II OF FEMA RULES, IN
THIS ISSUE. ELIGIBLE FPIS ARE PERMITTED TO PARTICIPATE IN THE ISSUE SUBJECT TO
COMPLIANCE WITH ALL APPLICABLE LAWS AND SUCH THAT THE SHAREHOLDING OF THE
FPIs DO NOT EXCEED SPECIFIED LIMITS AS PRESCRIBED UNDER APPLICABLE LAWS IN THIS
REGARD.
In terms of the SEBI FPI Regulations and the FEMA Rules, the issue of Equity Shares to a single Eligible FPI or an
investor group (which means the multiple entities having common ownership, directly or indirectly, of more than 50%
or common control) must be below 10% of the post-Issue Equity Share capital of our Company. In case the total
holding of an FPI, including its investor group, increases to 10% or more of the total paid-up equity capital of a
company, on a fully diluted basis or 10% or more of the paid-up value of any series of debentures or preference shares
or share warrants issued that may be issued by the company, the total investment made by such FPI together with its
investor group will be re-classified as FDI as per the procedure and subject to the conditions specified by the SEBI
FPI Regulations and the FEMA Rules in this regard and the company and the investor will be prohibited from making
any further portfolio investment in the company and also required to comply with applicable reporting requirements.
In terms of the FEMA Rules, for calculating the aggregate holding of FPIs in a company, holding of all registered
FPIs shall be included. However, in accordance with Regulation 22(4) of the SEBI FPI Regulations, the FPIs who are:
(i) appropriately regulated public retail funds; (b) public retail funds where the majority is owned by appropriately
regulated public retail fund on look through basis; or (c) public retail funds and investment managers of such foreign
portfolio investors are appropriately regulated, the aggregation of the investment limits of such FPIs having common
control, shall not be applicable.
The existing individual and aggregate investment limits for an FPI in our Company is 10% and 100% of the total paid-
up Equity Share capital of our Company on a fully diluted basis, respectively and the sectoral cap applicable to our
Company in accordance with the FEMA Rules, respectively.
Further, with effect from April 1, 2020, the limit of total holdings of all Eligible FPIs put together shall be the sectoral
cap applicable to a company, depending on the sector, as per FEMA Rules. Prior to March 31, 2020, the aggregate
FPI limit could have been decreased by a company to certain prescribed lower threshold limits with the approval of
the shareholders through a special resolution. Further, in case a company decreased its aggregate limit, it may increase
such aggregate limit to the prescribed limits with shareholder approval through a special resolution. However, a
company shall not be allowed to reduce the aggregate FPI limit to a lower threshold once such limit has been increased.
Pursuant to the SEBI Circular dated April 5, 2018 (Circular No: IMD/FPIC/CIR/P/2018/61), our Company has
appointed NSDL as the designated depository to monitor the level of FPI/NRI shareholding in our Company on a
daily basis and once the aggregate foreign investment of a company reaches a cut-off point, which is 3% below the
overall limit, a red flag shall be activated. The depository is then required to inform the Stock Exchanges about the
activation of the red flag. The Stock Exchanges are then required to issue the necessary circulars/ public notifications
on their respective websites. Once a red flag is activated, the FPIs must trade cautiously, because in the event that
there is a breach of the sectoral cap, the FPIs will be under an obligation to disinvest the excess holding within five
trading days from the date of settlement of the trades.
Eligible FPIs are permitted to participate in the Issue subject to compliance with conditions and restrictions which
may be specified by the Government from time to time.
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In terms of the FEMA Rules, for calculating the aggregate holding of FPIs in a company, holding of all registered
FPIs shall be included.
Restriction on Allotment
Regulation 179(2)(b) of the SEBI ICDR Regulations is not applicable to our Company since the Promoter of the
Company is the President of India, acting through the Ministry of Mines, Government of India.
Our Company and the Book Running Lead Managers and any of their respective shareholders, employees,
counsels, officers, directors, representatives, agents, advisors or affiliates shall not be liable for any amendment
or modification or change to applicable laws or regulations, which may occur after the date of the Preliminary
Placement Document. Eligible QIBs are advised to make their independent investigations and satisfy
themselves that they are eligible to apply. Eligible QIBs are advised to ensure that any single application from
them does not exceed the investment limits or maximum number of Equity Shares that can be held by them
under applicable law or regulation or as specified in the Preliminary Placement Document. Further, Eligible
QIBs are required to satisfy themselves that their Bids would not result in triggering a tender offer under the
SEBI Takeover Regulations and ensure compliance with applicable laws.
A minimum of 10% of the Equity Shares offered in the Issue shall be Allotted to Mutual Funds. In case of
undersubscription in such portion, such portion or part thereof may be Allotted to other Eligible QIBs.
Note: Affiliates or associates of the Book Running Lead Managers who are Eligible QIBs may participate in the Issue
in compliance with applicable laws.
Bid Process
Application Form
Eligible QIBs shall only use the serially numbered Application Forms (which are addressed to them) supplied by our
Company and the Book Running Lead Managers in either electronic form or by physical delivery for the purpose of
making a Bid (including revision of a Bid) in terms of the Preliminary Placement Document. The Application Form
may be signed physically or digitally, if required under applicable law in the relevant jurisdiction applicable to each
Eligible QIB and as permitted under such applicable law. An Eligible QIB may submit an unsigned copy of the
Application Form, as long as the Application Amount is paid along with submission of the Application Form within
the Issue Period, and in such case, it shall be assumed that the person submitting the Application Form and providing
necessary instructions for transfer of the Application Amount to the Escrow Account, on behalf of the Eligible QIB is
authorized to do so.
By making a Bid (including the revision thereof) for Equity Shares through Application Forms and pursuant to the
terms of the Preliminary Placement Document, the Eligible QIB will be deemed to have made all the following
representations, warranties, acknowledgements, agreements and undertakings given or made under the sections titled
“Notice to Investors”, “Representations by Investors”, “Selling Restrictions” and “Transfer Restrictions” on pages 3 ,
5, 174 and 182, respectively:
1. The Eligible QIB confirms that it is a QIB in terms of Regulation 2(1)(ss) of the SEBI ICDR Regulations and
is not excluded under Regulation 179(2)(b) of the SEBI ICDR Regulations, has a valid and existing registration
under the applicable laws in India (as applicable) and is eligible to participate in this Issue;
2. The Eligible QIB confirms that it is not a Promoter and is not a person related to the Promoter, either directly
or indirectly and its Application Form does not directly or indirectly represent the Promoter or Promoter Group
or persons related to the Promoter;
3. The Eligible QIB confirms that it has no rights under a shareholders’ agreement or voting agreement with the
Promoter or members of the Promoter Group, no veto rights or right to appoint any nominee director on the
Board other than those acquired in the capacity of a lender not holding Equity Shares which shall not be deemed
to be a person related to the Promoter;
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4. The Eligible QIB acknowledges that it has no right to withdraw or revise its Bid downwards after the Issue
Closing Date;
5. The Eligible QIB confirms that in the event it is resident outside India, it is an Eligible FPI, having a valid and
existing registration with SEBI under the applicable laws in India, and is eligible to invest in India under
applicable law, including the FEMA Rules, as amended, and any notifications, circulars or clarifications issued
thereunder, and has not been prohibited by any other regulatory authority, from buying, selling, dealing in
securities or otherwise accessing the capital markets, and is not an FVCIs or a non-resident multilateral or
bilateral development financial institution;
6. The Eligible QIB confirms that if Equity Shares are Allotted through this Issue, it shall not, for a period of one
year from Allotment, sell such Equity Shares otherwise than on the Stock Exchanges;
7. The Eligible QIB confirms that it is eligible to Bid and hold Equity Shares so Allotted together with any Equity
Shares held by it prior to the Issue, if any. The Eligible QIB further confirms that the holding of the Eligible
QIB, does not and shall not, exceed the level permissible as per any applicable regulations applicable to the
Eligible QIB;
8. The Eligible QIB confirms that its Bid would not eventually result in triggering an open offer under the SEBI
Takeover Regulations;
9. The Eligible QIB agrees that it will make payment of its Application Amount along with submission of the
Application Form within the Issue Period. The Eligible QIB further agrees that once a duly filled Application
Form is submitted by an Eligible QIB, whether signed or not, and the Application Amount has been transferred
to the Escrow Account, such Application Form constitutes an irrevocable offer and cannot be withdrawn or
revised downwards after the Issue Closing Date;
10. The Eligible QIB agrees that although the Application Amount is required to be paid by it along with the
Application Form within the Issue Period in terms of provisions of the Companies Act and rules made
thereunder, our Company reserves the right to Allocate and Allot Equity Shares pursuant to this Issue on a
discretionary basis in consultation with the Book Running Lead Managers. The Eligible QIB further
acknowledges and agrees that the payment of Application Amount does not guarantee Allocation and/or
Allotment of Equity Shares Bid for in full or in part;
11. The Eligible QIB acknowledges that in terms of the requirements of the Companies Act, upon Allocation, our
Company will be required to disclose names as proposed Allottees and percentage of post-Issue shareholding
of the proposed Allottees in the Placement Document and consents of such disclosure, if any Equity Shares are
Allocated to it. However the Eligible QIB further acknowledges and agrees, that disclosure of such details in
relation to the proposed Allottees in the Placement Document will not guarantee Allotment to them, as
Allotment in the Issue shall continue to be at the sole discretion of our Company, in consultation with the Book
Running Lead Managers;
12. The Eligible QIB confirms that the number of Equity Shares Allotted to it pursuant to the Issue, together with
other Allottees that belong to the same group or are under common control, shall not exceed 50% of the Issue.
For the purposes of this representation:
a. QIBs “belonging to the same group” shall mean entities where (a) any of them controls, directly or
indirectly, through its subsidiary or holding company, not less than 15% of the voting rights in the other;
(b) any of them, directly or indirectly, by itself, or in combination with other persons, exercise control
over the others; or (c) there is a common director, excluding nominee and Independent Directors,
amongst an Eligible QIB, its subsidiary(ies) or holding company and any other Eligible QIB; and
b. ‘Control’ shall have the same meaning as is assigned to it by Regulation 2(1)(e) of the SEBI Takeover
Regulations;
13. The Eligible QIB confirms that:
a. It will make payment of its Application Amount along with submission of the Application Form before
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the Issue Closing Date; and
b. It is outside the United States, and is purchasing the Equity Shares in an “offshore transaction” in reliance
upon Regulation S and it has agreed to certain other representations set forth in the Application Form.
14. The Eligible QIB confirms that it, individually or together with its investor group, is not restricted from making
further investments in our Company through the portfolio investment route, in terms of Regulation 22(3) of the
SEBI FPI Regulations.
15. The Eligible QIBs confirms that it shall not undertake any trade in the Equity Shares credited to its beneficiary
account maintained with the Depository Participant until such time that the final listing and trading approvals
for the Equity Shares are issued by the Stock Exchanges;
16. The Eligible QIB acknowledges that no Allotment shall be made to it if the price at which they have Bid for in
the Issue is lower than the Issue Price; and
17. Each Eligible FPI, confirms that it will participate in the Issue only under and in conformity with Schedule II
of FEMA Rules. Further, each Eligible FPI acknowledges that Eligible FPIs may invest in such number of
Equity Shares such that the individual investment of the Eligible FPI or its investor group (multiple entities
registered as FPIs and directly or indirectly, having common ownership of more than fifty per cent or common
control) in our Company does not exceed 10% of the post-Issue paid-up capital of our Company, on a fully
diluted basis.
ELIGIBLE QIBs MUST PROVIDE THEIR NAME, COMPLETE ADDRESS, PHONE NUMBER, EMAIL
ID, BANK ACCOUNT DETAILS, BENEFICIARY ACCOUNT DETAILS, PAN / PAN ALLOTMENT
LETTER, DEPOSITORY PARTICIPANT’S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION
NUMBER AND BENEFICIARY ACCOUNT NUMBER IN THE APPLICATION FORM. ELIGIBLE QIBS
MUST ENSURE THAT THE NAME GIVEN IN THE APPLICATION FORM IS EXACTLY THE SAME AS
THE NAME IN WHICH THEIR BENEFICIARY ACCOUNT IS HELD.
IF SO REQUIRED BY THE BOOK RUNNING LEAD MANAGERS, THE ELIGIBLE QIBs SUBMITTING
A BID, ALONG WITH THE APPLICATION FORM, WILL ALSO HAVE TO SUBMIT REQUISITE
DOCUMENT(S) TO THE BOOK RUNNING LEAD MANAGERS TO EVIDENCE THEIR STATUS AS A
"QIB" AS DEFINED HEREINABOVE.
IF SO REQUIRED BY THE BOOK RUNNING LEAD MANAGERS, ESCROW BANK OR ANY
STATUTORY OR REGULATORY AUTHORITY IN THIS REGARD, INCLUDING AFTER ISSUE
CLOSING DATE, THE ELIGIBLE QIBs SUBMITTING A BID AND/OR BEING ALLOTTED EQUITY
SHARES IN THE ISSUE, WILL ALSO HAVE TO SUBMIT REQUISITE DOCUMENT(S) TO FULFIL THE
APPLICABLE KNOW YOUR CUSTOMER (KYC) NORMS.
Demographic details such as address and bank account will be obtained from the Depositories as per the Depository
Participant account details provided in the Application Form. However, for the purposes of refund of all or part of the
Application Amount submitted by the Bidder, the bank details as mentioned in the Application Form from which the
Application Amount shall be remitted for the Equity Shares applied for in the Issue, will be considered.
The submission of an Application Form and payment of the Application Amount pursuant to the Application Form
by a Bidder shall be deemed a valid, binding and irrevocable offer for such Bidder to pay the entire Issue Price for the
Equity Shares that may be Allotted to such Bidder and becomes a binding contract on a Successful Bidder upon
issuance of the CAN and the Placement Document (when dispatched) by our Company (by itself or through any
BRLM) in favour of the Successful Bidder.
Submission of Application Form
All Application Forms must be duly completed with information including the name of the Eligible QIB, the number
of Equity Shares applied for along with proof of payment and a copy of the PAN card or PAN allotment letter (if
applicable). Additionally, the Application Form will include details of the relevant Escrow Account into which the
Application Amounts will have to be deposited. The Application Amount shall be deposited in the Escrow Account
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as is specified in the Application Form and the Application Form shall be submitted to the Book Running Lead
Managers either through electronic form or through physical delivery at either of the following addresses:
Name of the Book
Running Lead
Managers
Address Contact person Contact
IDBI Capital
Markets &
Securities
Limited
6th Floor, IDBI Tower, World
Trade Centre, Cuffe Parade,
Mumbai 400 005. Maharashtra,
India
Subodh Gandhi/
Sumit Singh
Tel: +91 22 22171700
Fax: +91 22 22151787
Email: hcl.qip@idbicapital.com
SBI Capital
Markets Limited
202, Maker Tower ‘E’,
Cuffe Parade,
Mumbai 400 005
Lalit Mahajan Tel: +91 22 2217 8300
Fax: +91 22 2218 8332
Email: hcl.qip@sbicaps.com
The Book Running Lead Managers shall not be required to provide any written acknowledgement of the receipt of the
Application Form and the Application Amount.
Bidders, Bidding in the Issue, shall pay the entire Application Amount along with the submission of the Application
Form, within the Issue Period.
Payment of Application Amount
Our Company has opened the Escrow Account in the name of “HINDUSTAN COPPER LIMITED QIP ESCROW
ACCOUNT” with State Bank of India, our Escrow Bank, in terms of the Escrow Agreement. Bidders will be required
to deposit the entire Application Amount payable for the Equity Shares applied for, along with the submission of the
Application Form submitted by it in accordance with the applicable laws and during the Issue Period. Bidders can
make payment of the Application Amount only through electronic transfer of funds from their own bank account.
Note: Payments are to be made only through electronic fund transfer from the Bidder’s own bank account.
Payments made through cheques or demand draft or cash shall be liable to be rejected. Further, if the payment
is not made favouring the Escrow Account within the Issue Period stipulated in the Application Form, the
Application Form is liable to be rejected.
Pending Allotment, our Company undertakes to utilise the amount deposited in the Escrow Account only for the
purposes of (i) adjustment against allotment of Equity Shares in the Issue; or (ii) repayment of Application Amount if
our Company is not able to Allot Equity Shares in the Issue. Notwithstanding the above, in the event a Bidder is not
allocated Equity Shares in the Issue, or the number of Equity Shares Allocated to a Bidder, is lower than the number
of Equity Shares applied for through the Application Form and towards which Application Amount has been paid by
such Bidder, or the Application Amount was in excess of the amount equivalent to the product of the Equity Shares
that have been Allocated to the Bidder and the Issue Price, or the Application Amount has been arrived at using an
indicative price higher than the Issue Price, or any Bidder lowers or withdraws their Bid after submission of the
Application Form but prior to the Issue Closing Date, the excess Application Amount will be refunded to the same
bank account from which Application Amount was remitted, in the form and manner set out in “- Refunds” on page
170.
Pricing and Allocation
Build-up of the Book
The Eligible QIBs shall submit their Bids (including any revision thereof) through the Application Forms within the
Issue Period to the Book Running Lead Managers. Such Bids cannot be withdrawn or revised downwards after the
Issue Closing Date. The book shall be maintained by the Book Running Lead Managers.
Price Discovery and Allocation
There is a minimum pricing requirement under the SEBI ICDR Regulations. The Floor Price shall not be less than the
average of the weekly high and low of the closing prices of the Equity Shares quoted on the Stock Exchanges during
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the two weeks preceding the Relevant Date as calculated in accordance with Chapter VI of the SEBI ICDR
Regulations. Further, our Company may offer a discount of not more than 5% of the Floor Price in terms of Regulation
176 of the SEBI ICDR Regulations and in accordance with the special resolution passed by our Shareholders by way
of a postal ballot on January 28, 2021.
Our Company, in consultation with the Book Running Lead Managers, shall determine the Issue Price, which shall be
at or above the Floor Price.
The “Relevant Date” referred to above will be the date of the meeting in which the Board decides to open the Issue
and “stock exchange” means any of the recognized stock exchanges in India on which the Equity Shares of the issuer
of the same class are listed and on which the highest trading volume in such Equity Shares has been recorded during
the two weeks immediately preceding the Relevant Date. After finalisation of the Issue Price, our Company shall
update the Preliminary Placement Document with the Issue details and file the same with the Stock Exchanges as the
Placement Document.
Method of Allocation
Our Company shall determine the Allocation in consultation with the Book Running Lead Managers on a discretionary
basis and in compliance with Chapter VI of the SEBI ICDR Regulations.
Bids received from the Eligible QIBs at or above the Issue Price shall be grouped together to determine the total
demand. The Allocation to all such Eligible QIBs will be made at the Issue Price. Allocation to Mutual Funds for up
to a minimum of 10% of the Issue Size shall be undertaken subject to valid Bids being received at or above the Issue
Price.
THE DECISION OF OUR COMPANY IN CONSULTATION WITH THE BOOK RUNNING LEAD
MANAGERS IN RESPECT OF ALLOCATION SHALL BE FINAL AND BINDING ON ALL BIDDERS.
BIDDERS MAY NOTE THAT ALLOCATION OF EQUITY SHARES IS AT THE SOLE AND ABSOLUTE
DISCRETION OF OUR COMPANY, IN CONSULTATION WITH THE BOOK RUNNING LEAD
MANAGERS AND ELIGIBLE QIBs MAY NOT RECEIVE ANY ALLOCATION EVEN IF THEY HAVE
SUBMITTED VALID APPLICATION FORMS AND PAID THE ENTIRE APPLICATION AMOUNT AT
OR ABOVE THE ISSUE PRICE WITHIN THE ISSUE PERIOD. NEITHER OUR COMPANY NOR THE
BOOK RUNNING LEAD MANAGERS ARE OBLIGED TO ASSIGN ANY REASON FOR ANY NON-
ALLOCATION.
CAN
Based on receipt of the serially numbered Application Forms and Application Amount, our Company, in consultation
with the Book Running Lead Managers, in their sole and absolute discretion, shall decide the Successful Bidders to
whom the serially numbered CAN shall be dispatched, pursuant to which the details of the Equity Shares Allocated
to them, the Issue Price and the Application Amount for the Equity Shares Allotted shall be notified to such Successful
Bidders. Additionally, the CAN will include the probable Designated Date, being the date of credit of the Equity
Shares to the Bidders’ account, as applicable to the respective Bidder.
The Successful Bidders would also be sent a serially numbered Placement Document (which will include the names
of the proposed Allottees along with the percentage of their post-Issue Shareholding in our Company) either in
electronic form or by physical delivery.
The dispatch of the serially numbered CAN and the Placement Document (when dispatched), to the Eligible QIBs
shall be deemed a valid, binding and irrevocable contract for the Eligible QIBs to furnish all details that may be
required by the Book Running Lead Managers, and to subscribe to the Equity Shares Allocated to such Successful
Bidders. Subsequently, our Board (or a duly constituted committee thereof) will approve the Allotment to the Allottees
in consultation with the Book Running Lead Managers.
QIBS ARE ADVISED TO INSTRUCT THEIR DEPOSITORY PARTICIPANT TO ACCEPT THE EQUITY
SHARES THAT MAY BE ALLOTTED TO THEM PURSUANT TO THE ISSUE.
By submitting the Application Form, an Eligible QIB would have deemed to have made the representations and
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warranties as specified in the section titled “Notice to Investors” on page 3 and further that such Eligible QIB shall
not undertake any trade on the Equity Shares credited to its Depository Participant account pursuant to the Issue until
such time as the final listing and trading approval is issued by Stock Exchanges.
Designated Date and Allotment of Equity Shares
Subject to the satisfaction of the terms and conditions in the Placement Agreement, at the Allotment of Equity Shares is completed by the Designated Date provided in the respective CANs.
In accordance with the SEBI ICDR Regulations, the Equity Shares in the Issue will be issued and Allotment shall be
made only in dematerialised form to the Allottees. However, no transfer in physical form is permitted as per Regulation
40 of the SEBI Listing Regulations.
Our Company, at its sole discretion, reserves the right to cancel the Issue at any time up to Allotment without assigning
any reason whatsoever.
Following the Allotment and credit of Equity Shares into the Successful Bidders’ beneficiary accounts maintained
with the Depository Participant, as indicated in the respective Application Form, our Company will apply for obtaining
listing approvals. Post receipt of listing approvals and credit of Equity Shares into the beneficiary accounts of the
Eligible QIBs, our Company will apply for the trading approvals from the Stock Exchanges.
Pursuant to a circular dated March 5, 2010, issued by SEBI, Stock Exchanges are required to make available on their
websites the details of those Allottees in Issue who have been allotted more than 5% of the Equity Shares offered in
the Issue, viz, the names of the Allottees, and number of Equity Shares Allotted to each of them, pre and post Issue
shareholding pattern of our Company along with the Placement Document. Our Company shall make the requisite
filings with the RoC within the stipulated period as required under the Companies Act, 2013 and the PAS Rules.
Further, as required in terms of the PAS Rules, names of the proposed Allottees and the percentage of their post-Issue
shareholding in our Company will be disclosed in the Placement Document.
The Escrow Bank shall release the monies lying to the credit of the Escrow Account to our Company upon receipt of
notice from the Book Running Lead Managers and the trading and listing approvals of the Stock Exchanges for Equity
Shares offered in the Issue and after filing return of Allotment under Form PAS-3 with the RoC.
After finalization of the Issue Price, our Company shall update the Preliminary Placement Document with the Issue
details and file the same with the Stock Exchanges as the Placement Document.
Refunds
In the event that the number of Equity Shares Allocated to a Bidder is lower than the number of Equity Shares applied
for through the Application Form and towards which Application Amount has been paid by such Bidder, or the
Application Amount paid by a Bidder is in excess of the amount equivalent to the product of the Equity Shares that
have been Allocated to such Bidder and the Issue Price, or Equity Shares are not Allocated to a Bidder for any reasons,
or a Bidder lowers or withdraws the Bid prior to the Issue Closing Date, or the Issue is cancelled prior to Allocation,
any excess Application Amount paid by such Bidder will be refunded to the same bank account from which the
Application Amount was remitted, in the form and manner set out in the Application Form. The Refund Amount will
be transferred to the relevant Bidders within one Working Day from the issuance of the CAN.
In the event that Equity Shares have been Allocated to Successful Bidders and our Company is unable to issue and
Allot the Equity Shares offered in the Issue within 60 days from the date of receipt of the Application Amount, or the
Issue is cancelled post Allocation, or where our Company has Allotted the Equity Shares but final listing and trading
approvals are refused by the Stock Exchanges, our Company shall repay the Application Amount within 15 days from
expiry of 60 days or such other time period as applicable under applicable law, failing which our Company shall repay
that money with interest at such rate and in such manner as prescribed under the Companies Act, 2013.
Following the Allotment and credit of Equity Shares into the Eligible QIBs’ Depository Participant accounts, we will
apply for final trading and listing approvals from the Stock Exchanges. In the event of any delay in the Allotment or
credit of Equity Shares, or receipt of trading or listing approvals or cancellation of the Issue, no interest or penalty
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would be payable by us.
Other Instructions
Submission of Documents
A physical copy of the Application Form and relevant documents as required to be provided along with the Application
Form shall be submitted as soon as practicable.
Right to Reject Applications
Our Company, in consultation with the Book Running Lead Managers, may reject Bids, in part or in full, without
assigning any reason whatsoever. The decision of our Company in consultation with the Book Running Lead Managers
in relation to the rejection of Bids shall be final and binding. In the event the Bid is rejected by our Company, the
Application Amount paid by the Bidder shall be refunded to the same bank account from which the Application
Amount was remitted by such Bidder as set out in the Application Form. For details, please see the section titled “-
Refunds” on page 170.
Equity Shares in dematerialised form with NSDL or CDSL
The Allotment shall be only in dematerialised form (i.e., not in physical certificates but be fungible and be represented
by the statement issued through the electronic mode).
An Eligible QIB applying for Equity Shares to be issued pursuant to the Issue must have at least one beneficiary
account with a Depository Participant of either NSDL or CDSL prior to making the Bid. Equity Shares Allotted to a
Successful Bidder will be credited in electronic form directly to the beneficiary account (with the Depository
Participant) of the Successful Bidder, as indicated in the Application Form.
Equity Shares in electronic form can be traded only on the stock exchanges having electronic connectivity with NSDL
and CDSL. The Stock Exchanges have electronic connectivity with NSDL and CDSL.
The trading of the Equity Shares to be issued pursuant to the Issue would be in dematerialised form only for all QIBs
in the cash segment of the respective Stock Exchanges.
Our Company and the Book Running Lead Managers will not be responsible or liable for the delay in the credit of
Equity Shares to be issued pursuant to the Issue due to errors in the Application Form or otherwise on the part of the
Bidders.
Bank Account Details
Each Eligible QIB shall mention the details of the bank account from which the payment of Application Amount has
been made along with confirmation that such payment has been made from such account.
Release of Funds to our Company
The Escrow Bank shall not release the monies lying to the credit of the “HINDUSTAN COPPER LIMITED QIP
ESCROW ACCOUNT” to our Company until receipt of notice from the Book Running Lead Managers, the receipt
of the final listing and trading and listing approvals of the Stock Exchanges for Equity Shares offered in the Issue and
filing of return of Allotment under Form PAS-3 with the RoC.
Permanent Account Number or PAN
Each Bidder should mention its PAN allotted under the IT Act in the Application Form and enclose a copy of the PAN
card or PAN allotment letter (as applicable) along with the Application Form. Application Forms without this
information will be considered incomplete and are liable to be rejected. Bidders should not submit the GIR number
instead of the PAN as the Application Form is liable to be rejected on this ground.
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PLACEMENT AND LOCK-UP
Placement Agreement
The Book Running Lead Managers have entered into a placement agreement with our Company dated April 7, 2021
(the “Placement Agreement”), pursuant to which the Book Running Lead Managers have severally agreed to manage
the Issue and to act as placement agents in connection with the proposed Issue and procure subscriptions for the Equity
Shares on a reasonable efforts basis, pursuant to Section 42 of Companies Act, 2013, read with Rule 14 of the
Companies (Prospectus and Allotment of Securities) Rules, 2014, and Chapter VI of the SEBI ICDR Regulations.
The Placement Agreement contains customary representations, warranties and indemnities from our Company and
the Book Running Lead Managers, and it is subject to termination in accordance with the terms contained therein.
Applications shall be made to list the Equity Shares issued pursuant to this Issue and admit them to trading on the
Stock Exchanges. No assurance can be given as to the liquidity or sustainability of the trading market for such Equity
Shares, the ability of holders of the Equity Shares to sell their Equity Shares or the price at which holders of the Equity
Shares will be able to sell their Equity Shares.
The Preliminary Placement Document and the Placement Document have not been, and will not be, registered as a
prospectus with the RoC and, no Equity Shares issued pursuant to this Issue will be offered in India or overseas to the
public or any members of the public in India or any other class of investors, other than QIBs.
The Equity Shares have not been and will not be registered under the Securities Act, or the securities laws of any state
of the United States and, unless so registered, may not be offered or sold within the United States, except pursuant to
an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable
U.S. state securities laws. Accordingly, the Equity Shares are being offered and sold only outside the United States in
‘offshore transactions’ (as defined in Regulation S) in reliance on Regulations S and the applicable laws of the
jurisdiction where those offers and sales are made.
Relationship with the Book Running Lead Managers
In connection with the Issue, the Book Running Lead Managers, (or their affiliates) may, for their own accounts,
subscribe to the Equity Shares or enter into asset swaps, credit derivatives or other derivative transactions relating to
the Equity Shares to be issued pursuant to the Issue at the same time as the offer and sale of the Equity Shares or in
secondary market transactions. As a result of such transactions, the Book Running Lead Managers may hold long or
short positions in such Equity Shares. These transactions may comprise a substantial portion of the Issue and no
specific disclosure will be made of such positions. Affiliates of the Book Running Lead Managers may purchase
Equity Shares and be Allocated Equity Shares for proprietary purposes and not with a view to distribution or in
connection with the issuance of P-Notes.
From time to time, the Book Running Lead Managers, and certain of their affiliates and associates may be engaged in
or may in the future engage in transactions with and perform services including but not limited to investment banking,
advisory, banking, trading services, particularly acting as an underwriter or book running lead manager, for our
Company and the Shareholders, as well as to their respective associates and affiliates, pursuant to which fees and
commissions have been paid or will be paid to the Book Running Lead Managers and their affiliates and associates.
Lock-up
The Company has undertaken that it will not for a period commencing from the date hereof and of 180 days from the
date of Allotment under the Placement, without the prior written consent of the Book Running Lead Managers, directly
or indirectly:
(a). offer, issue, contract to issue, issue or offer any option or contract to purchase, lend, sell purchase any option or
contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, any Equity Shares
or any securities convertible into or exercisable for Equity Shares (including, without limitation, securities convertible
into or exercisable or exchangeable for Equity Shares which may be deemed to be beneficially owned), or file any
registration statement under the U.S. Securities Act of 1933, as amended, with respect to any of the foregoing, or
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(b) enter into any swap or other agreement or any transaction that transfers, in whole or in part, directly or indirectly,
any of the economic consequences associated with the ownership of any of the Equity Shares or any securities
convertible into or exercisable or exchangeable for Equity Shares (including, without limitation, securities convertible
into or exercisable or exchangeable for Equity Shares regardless of whether any of the transactions described in clause
(a) or (b) is to be settled by the delivery of Equity Shares or such other securities, in cash or otherwise), or
(c) deposit Equity Shares with any other depositary in connection with a depositary receipt facility,
(d) enter into any transaction (including a transaction involving derivatives) having an economic effect similar to that
of an issue, offer, sale or deposit of the Equity Shares in any depository receipt facility,
(e) publicly announce any intention to enter into any transaction falling within (a) to (d) above or enter into any
transaction (including a transaction involving derivatives) having an economic effect similar to that of an issue or
offer or deposit of Equity Shares in any depositary receipt facility or publicly announce any intention to enter into any
transaction falling within (a) to (d) above; provided, however, that the foregoing restrictions do not apply to any issue
or offer to the extent such issue or offer is required by Indian law.
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SELLING RESTRICTIONS
The distribution of this Placement Document and the offer, sale or delivery of the Equity Shares in this Issue is
restricted by law in certain jurisdictions. Therefore, persons who may come into possession of this Placement
Document are advised to consult with their own legal advisors as to what restrictions may be applicable to them and
to observe such restrictions. This Placement Document may not be used for the purpose of an offer or invitation in
any circumstances in which such offer or invitation is not authorised.
General
No action has been taken or will be taken that would permit a public offering of the Equity Shares to occur in any
jurisdiction other than India, or the possession, circulation or distribution of this Placement Document or any other
material relating to our Company or the Equity Shares in any jurisdiction where action for such purpose is
required. Accordingly, the Equity Shares may not be offered or sold, directly or indirectly, and neither this
Placement Document nor any offering materials or advertisements in connection with the Equity Shares may be
distributed or published in or from any country or jurisdiction except under circumstances that will result in
compliance with any applicable rules and regulations of any such country or jurisdiction. The Issue will be
made in compliance with the applicable SEBI Regulations, Section 42 of the Companies Act, 2013 read with Rule
14 of the PAS Rules and other applicable provisions of the Companies Act, 2013 and the rules made thereunder. Each
purchaser of the Equity Shares in the Issue will be deemed to have made acknowledgments and agreements as
described under “Transfer Restrictions” on page 182.
Republic of India
This Placement Document may not be distributed directly or indirectly in India or to residents of India and any Equity
Shares may not be offered or sold directly or indirectly in India to, or for the account or benefit of, any resident of
India except as permitted by applicable Indian laws and regulations, under which an offer is strictly on a private and
confidential basis and is limited to Eligible QIBs and is not an offer to the public. This Placement Document has not
been and will not be registered as a prospectus with the RoC, and will not be circulated or distributed to the public in
India or any other jurisdiction, and will not constitute a public offer in India or any other jurisdiction.
Australia
This Placement Document:
• does not constitute a product disclosure document or a prospectus under Chapter 6D.2 of the Corporations Act
2001 (Cth) (the “Corporations Act”);
• has not been, and will not be, lodged with the Australian Securities and Investments Commission (“ASIC”), as
a disclosure document for the purposes of the Corporations Act and does not purport to include the information
required of a disclosure document under Chapter 6D.2 of the Corporations Act;
• does not constitute or involve a recommendation to acquire, an offer or invitation for issue or sale, an offer or
invitation to arrange the issue or sale, or an issue or sale, of interests to a “retail client” (as defined in section
761G of the Corporations Act and applicable regulations) in Australia; and
• may only be provided in Australia to select investors who are able to demonstrate that they fall within one or
more of the categories of investors (“Exempt Investors”), available under section 708 of the Corporations Act.
The Equity Shares may not be directly or indirectly offered for subscription or purchased or sold, and no invitations
to subscribe for or buy the Equity Shares may be issued, and no draft or definitive preliminary Placement Document,
advertisement or other offering material relating to any Equity Shares may be distributed in Australia, except where
disclosure to investors is not required under Chapter 6D of the Corporations Act or is otherwise in compliance with
all applicable Australian laws and regulations. By submitting an application for the Equity Shares, you represent and
warrant to us that you are an Exempt Investor.
As any offer of Equity Shares under this Placement Document will be made without disclosure in Australia under
Chapter 6D.2 of the Corporations Act, the offer of those securities for resale in Australia within 12 months may, under
section 707 of the Corporations Act, require disclosure to investors under Chapter 6D.2 if none of the exemptions in
section 708 applies to that resale. By applying for the Equity Shares you undertake to us that you will not, for a period
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of 12 months from the date of issue of the Equity Shares, offer, transfer, assign or otherwise alienate those securities
to investors in Australia except in circumstances where disclosure to investors is not required under Chapter 6D.2 of
the Corporations Act or where a compliant disclosure document is prepared and lodged with ASIC.
Bahrain
All applications for investment should be received, and any allotments should be made, in each case from outside
Bahrain. This Placement Document has been prepared for private information purposes of intended investors only who
will be high net worth individuals and institutions. Our Company has not made and will not make any invitation to the
public in the Kingdom of Bahrain and this Placement Document will not be issued, passed to, or made available to the
public generally. The Bahrain Monetary Agency (“BMA”) has not reviewed, nor has it approved, this Placement
Document or the marketing of Equity Shares in the Kingdom of Bahrain. Accordingly, Equity Shares may not be offered
or sold in Bahrain or to residents thereof except as permitted by Bahrain law.
British Virgin Islands
No invitation or offer has or will be made to the public in the British Virgin Islands to purchase or subscribe for any
of the Equity Shares.
Cayman Island
This document does not constitute a public offer of the Equity Shares, whether by way of sale or subscription, in the
Cayman Islands. Each Book Running Lead Manager has represented and agreed that it has not offered or sold, and
will not offer or sell, directly or indirectly, any Equity Shares to any member of the public in the Cayman Islands.
People’s Republic of China
This Placement Document does not constitute an offer of the Equity Shares offered in the Issue, whether by way of
sale or subscription, in the People’s Republic of China (the “PRC”). The Equity Shares are not being offered and may
not be offered or sold, directly or indirectly, in the PRC to or for the benefit of, legal or natural persons of the PRC.
According to legal and regulatory requirements of the PRC, the Equity Shares may, subject to the laws and regulations
of the relevant jurisdictions, only be offered or sold to non-PRC natural or legal persons in any country other than the
PRC.
European Economic Area
In relation to each Member State of the EEA (each a “Member State”), an offer to the public of any Equity Shares
may not be made in that Member State, except if the Equity Shares are offered to the public in that Member State at
any time under the following exemptions under the Prospectus Regulation (EU) 2017/1129 (and any amendment
thereto) (the “Prospectus Regulation”):
• to any legal entity which is a qualified investor as defined in the Prospectus Regulation;
• to fewer than 150 natural or legal persons (other than qualified investors as defined in the Prospectus
Regulation) subject to obtaining the prior consent of the Book Running Lead Managers for any such offer; or
• in any other circumstances falling within Article 1(4) of the Prospectus Regulation,
provided that no such offer of Equity Shares shall result in a requirement for the publication by our Company or the
Book Running Lead Managers of a prospectus pursuant to Article 3 of the Prospectus Regulation and each person
who initially acquires Equity Shares or to whom any offer is made will be deemed to have represented that they are a
“qualified investor” as defined in the Prospectus Regulation.
For the purposes of this section, the expression an “offer of Equity Shares to the public” in relation to any Equity
Shares in any Member State means a communication to persons in any form and by any means presenting sufficient
information on the terms of the offer and the Equity Shares to be offered so as to enable an investor to decide to
purchase or subscribe for the Equity Shares,.
In the case of any Equity Shares being offered to a financial intermediary, as that term is used in Article 5 of the
Prospectus Regulation, such financial intermediary will also be deemed to have represented, acknowledged and agreed
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that the Equity Shares subscribed for or acquired by it in the Issue have not been subscribed for or acquired on a non-
discretionary basis on behalf of, nor have they been subscribed for or acquired with a view to their offer or resale to
persons in circumstances which may give rise to an offer of any Equity Shares to the public other than their offer or
resale in a Member State to qualified investors (as so defined) or in circumstances in which the prior consent of the
Book Running Lead Managers has been obtained to each such proposed offer or resale. Our Company, its directors,
the Book Running Lead Managers and their affiliates, and others will rely upon the truth and accuracy of the foregoing
representation, acknowledgement and agreement. Notwithstanding the above, a person who is not a qualified investor
and who has notified the Book Running Lead Managers of such fact in writing may, with the consent of the Book
Running Lead Managers, be permitted to subscribe for or purchase Equity Shares in the Issue.
Hong Kong
This Placement Document has not been approved by the Securities and Futures Commission in Hong Kong and,
accordingly, (i) the Equity Shares have not been offered or sold and will not be offered or sold in Hong Kong, by means
of any document, other than (a) to “professional investors” as defined in the Securities and Futures Ordinance (Cap.
571) of Hong Kong (the “SFO”) and any rules made under that SFO; or (b) in other circumstances which do not result
in the document being a “prospectus” as defined in the Companies (Winding up and Miscellaneous Provisions)
Ordinance (Cap. 32) (the “CWUMPO”) of Hong Kong or which do not constitute an offer to the public within the
meaning of the CWUMPO; and (ii) the Book Running Lead Managers have not issued or had in its possession for the
purposes of the issue of Equity Shares whether in Hong Kong or elsewhere any advertisement, invitation or document
relating to the Equity Shares, which is directed at, or the contents of which are likely to be accessed or read by, the
public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong), other than with respect to
Equity Shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional
investors” as defined in the SFO and any rules made under the SFO.
Japan
The Equity Shares have not been and will not be registered under the Financial Instruments and Exchange Act of Japan
(the “FIEA”) and disclosure under the FIEA has not been and will not be made with respect to the Equity Shares. No
Equity Shares have, directly or indirectly, been offered or sold, and may not, directly or indirectly, be offered or sold in
Japan or to, or for the benefit of, any resident of Japan as defined in the first sentence of Article 6, Paragraph 1, Item 5
of the Foreign Exchange and Foreign Trade Law of Japan (“Japanese Resident”) or to others for re-offering or re-sale,
directly or indirectly in Japan or to, or for the benefit of, any Japanese Resident except (i) pursuant to an exemption
from the registration requirements of the FIEA and (ii) in compliance with any other relevant laws, regulations and
governmental guidelines of Japan.
If an offeree does not fall under a “qualified institutional investor” (tekikaku kikan toshika), as defined in Article 10,
Paragraph 1 of the Cabinet Office Ordinance Concerning Definition Provided in Article 2 of the Financial Instruments
and Exchange Act (the “Qualified Institutional Investor”), the Equity Shares will be offered in Japan by a private
placement to small number of investors (shoninzu muke kanyu), as provided under Article 2313, Paragraph 4 of the
FIEA, and accordingly, the filing of a securities registration statement for a public offering pursuant to Article 4,
Paragraph 1 of the FIEA has not been made.
If an offeree falls under the Qualified Institutional Investor, the Equity Shares will be offered in Japan by a private
placement to the Qualified Institutional Investors (tekikaku kikan toshikamuke kanyu), as provided under Article 23-13,
Paragraph 1 of the FIEA, and accordingly, the filing of a securities registration statement for a public offering pursuant
to Article 4, Paragraph 1 of the FIEA has not been made. To subscribe the Equity Shares (the “QII Equity Shares”) such
offeree will be required to agree that it will be prohibited from selling, assigning, pledging or otherwise transferring the
QII Equity Shares other than to another Qualified Institutional Investor.
Jordan
This Placement Document has not been and will not be filed with the Jordanian Securities Commission. This
Placement Document has not been and will not be distributed, and offers to sell, and sales of the Equity Shares will
not be made to more than 30 Jordanian residents. It may not be used for a public offering in Jordan of the Equity
Shares. Offers of the Equity Shares are being made from outside Jordan on a private one-on-one contact basis to pre-
identified potential investors in Jordan by persons who are not resident within Jordan and accordingly no registration,
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local prospectus filing and local agent requirements apply. This Placement Document is strictly for private use by its
holder and may not be passed on to third parties or otherwise distributed publicly.
Kuwait
This Placement Document is not for general circulation to the public in Kuwait. The Equity Shares have not been
licensed for offering in Kuwait by the Kuwait Capital Markets Authority or any other relevant Kuwaiti government
agency. The offering of the Equity Shares in Kuwait on the basis a private placement or public offering is, therefore,
restricted in accordance with Law No. 7 of 2010 and the bylaws thereto (as amended). No private or public offering
of the Equity Shares is being made in Kuwait, and no agreement relating to the sale of the Equity Shares will be
concluded in Kuwait. No marketing or solicitation or inducement activities are being used to offer or market the Equity
Shares in Kuwait
Malaysia
No prospectus or other offering material or document in connection with the offer and sale of the Equity Shares has
been or will be registered with the Securities Commission of Malaysia (“Commission”) for the Commission’s
approval pursuant to the Capital Markets and Services Act 2007. Accordingly, this Placement Document and any other
document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Equity
Shares may not be circulated or distributed, nor may the Equity Shares be offered or sold, or be made the subject of
an invitation for subscription or purchase, whether directly or indirectly, to persons in Malaysia other than (i) a closed
end fund approved by the Commission; (ii) a holder of a Capital Markets Services Licence; (iii) a person who acquires
the Equity Shares, as principal, if the offer is on terms that the Equity Shares may only be acquired at a consideration
of not less than RM250,000 (or its equivalent in foreign currencies) for each transaction; (iv) an individual whose total
net personal assets or total net joint assets with his or her spouse exceeds RM3 million (or its equivalent in foreign
currencies), excluding the value of the primary residence of the individual; (v) an individual who has a gross annual
income exceeding RM300,000 (or its equivalent in foreign currencies) per annum in the preceding twelve months;
(vi) an individual who, jointly with his or her spouse, has a gross annual income of RM400,000 (or its equivalent in
foreign currencies), per annum in the preceding twelve months; (vii) a corporation with total net assets exceeding
RM10 million (or its equivalent in a foreign currencies) based on the last audited accounts; (viii) a partnership with
total net assets exceeding RM10 million (or its equivalent in foreign currencies); (ix) a bank licensee or insurance
licensee as defined in the Labuan Financial Services and Securities Act 2010; (x) an Islamic bank licensee or takaful
licensee as defined in the Labuan Financial Services and Securities Act 2010; and (xi) any other person as may be
specified by the Commission; provided that, in the each of the preceding categories (i) to (xi), the distribution of the
Equity Shares is made by a holder of a Capital Markets Services Licence who carries on the business of dealing in
securities. The distribution in Malaysia of this Placement Document is subject to Malaysian laws. This Placement
Document does not constitute and may not be used for the purpose of public offering or an issue, offer for subscription
or purchase, invitation to subscribe for or purchase any securities requiring the registration of a prospectus with the
Commission under the Capital Markets and Services Act 2007.
Mauritius
The Equity Shares may not be offered or sold, directly or indirectly, to the public in Mauritius. Neither this Placement
Document nor any offering material or information contained herein relating to the offer of Equity Shares may be
released or issued to the public in Mauritius or used in connection with any such offer. This Placement Document
does not constitute an offer to sell Equity Shares to the public in Mauritius and is not a prospectus as defined under
the Companies Act 2001.
New Zealand
This Placement Document has not been registered, filed with or approved by any New Zealand regulatory authority
under the Financial Markets Conduct Act 2013 (the “FMA Act”). The Equity Shares offered in the Issue may only be
offered or sold in New Zealand (or allotted with a view to being offered for sale in New Zealand) to a person who: (a)
is an investment business within the meaning of clause 37 of Schedule 1 of the FMC Act; (b) meets the investment
activity criteria specified in clause 38 of Schedule 1 of the FMC Act; (c) is large within the meaning of clause 39 of
Schedule 1 of the FMC Act; (d) is a government agency within the meaning of clause 40 of Schedule 1 of the FMC
Act; or (e) is an eligible investor within the meaning of clause 41 of Schedule 1 of the FMC Act.
Republic of Korea
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The Equity Shares have not been and will not be registered under the Financial Investments Services and Capital
Markets Act of Korea and the decrees and regulations thereunder (the “FSCMA”), and the Equity Shares have been
and will be offered in Korea as a private placement under the FSCMA. None of the Equity Shares may be offered,
sold or delivered directly or indirectly, or offered or sold to any person for re-offering or resale, directly or indirectly,
in Korea or to any resident of Korea except pursuant to the applicable laws and regulations of Korea, including the
FSCMA and the Foreign Exchange Transaction Law of Korea and the decrees and regulations thereunder (the
“FETL”). Furthermore, the purchaser of the Equity Shares shall comply with all applicable regulatory requirements
(including but not limited to requirements under the FETL) in connection with the purchase of the Equity Shares. By
the purchase of the Equity Shares, the relevant holder thereof will be deemed to represent and warrant that if it is in
Korea or is a resident of Korea, it purchased the Equity Shares pursuant to the applicable laws and regulations of
Korea.
Sultanate of Oman
This Placement Document and the Equity Shares to which it relates may not be advertised, marketed, distributed or
otherwise made available to any person in Oman without the prior consent of the Capital Market Authority (“CMA”)
and then only in accordance with any terms and conditions of such consent. In connection with the offering of Equity
Shares, no prospectus has been filed with the CMA. The offering and sale of Equity Shares described in this Placement
Document will not take place inside Oman. This Placement Document is strictly private and confidential and is being
issued to a limited number of sophisticated investors, and may neither be reproduced, used for any other purpose, nor
provided to any other person than the intended recipient hereof.
Qatar (excluding the Qatar Financial Centre)
The Equity Shares have not been offered, sold or delivered, and will not be offered, sold or delivered at any time,
directly or indirectly, in the State of Qatar in a manner that would constitute a public offering. This Placement
Document has not been reviewed or registered with Qatari Government Authorities, whether under Law No. 25 (2002)
concerning investment funds, Central Bank resolution No. 15 (1997), as amended, or any associated regulations.
Therefore, this Placement Document is strictly private and confidential, and is being issued to a limited number of
sophisticated investors, and may not be reproduced or used for any other purposes, nor provided to any person other
than the recipient thereof.
The Capital Market Authority does not make any representation as to the accuracy or completeness of this Placement
Document, and expressly disclaims any liability whatsoever for any loss arising from, or incurred in reliance upon, any
part of this Placement Document. Prospective purchasers of the Equity Shares offered hereby should conduct their own
due diligence on the accuracy of the information relating to the Equity Shares. If you do not understand the contents of
this Placement Document, you should consult an authorized financial adviser.
Qatar Financial Centre
This Placement Document does not, and is not intended to, constitute an invitation or offer of securities from or within
the Qatar Financial Center (“QFC”), and accordingly should not be construed as such. This Placement Document has
not been reviewed or approved by or registered with the Qatar Financial Centre Authority, the Qatar Financial Centre
Regulatory Authority or any other competent legal body in the QFC. This Placement Document is strictly private and
confidential, and may not be reproduced or used for any other purpose, nor provided to any person other than the
recipient thereof. Our Company has not been approved or licensed by or registered with any licensing authorities
within the QFC.
Saudi Arabia
This Placement Document may not be distributed in the Kingdom of Saudi Arabia except to such persons as are
permitted under the Offers of Securities Regulations as issued by the board of the Saudi Arabian Capital Market
Authority (“CMA”) pursuant to resolution number 2-11-2004 dated October 4, 2004 as amended by resolution number
1-28-2008, as amended (the “CMA Regulations”). The CMA does not make any representation as to the accuracy or
completeness of this Placement Document and expressly disclaims any liability whatsoever for any loss arising from,
or incurred in reliance upon, any part of this Placement Document. Prospective purchasers of the securities offered
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hereby should conduct their own due diligence on the accuracy of the information relating to the securities. If you do
not understand the contents of this Placement Document, you should consult an authorized financial adviser.
Singapore
This Placement Document has not been registered as a prospectus with the Monetary Authority of Singapore.
Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for
subscription or purchase, of Equity Shares may not be circulated or distributed, nor may the Equity Shares be offered or
sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in
Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of
Singapore (the “SFA”), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A),
and in accordance with the conditions specified in Section 275 of the SFA, or (iii) otherwise pursuant to, and in
accordance with the conditions of, any other applicable provision of the SFA.
Where the Equity Shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is:
(a) a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which
is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an
accredited investor; or
(b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each
beneficiary of the trust is an individual who is an accredited investor,
securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries’ rights and interest
(howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has
acquired the Equity Shares pursuant to an offer made under Section 275 of the SFA except:
(a) to an institutional investor or to a relevant person defined in Section 275(2) of the SFA, or to any person
arising from an offer referred to in Section 275(1A) or Section 276(4)(i)(B) of the SFA;
(b) where no consideration is or will be given for the transfer;
(c) where the transfer is by operation of law;
(d) as specified in Section 276(7) of the SFA; or
(e) as specified in Regulation 32 of the Securities and Futures (Offers of Investments) (Shares and Debentures)
Regulations 2005 of Singapore.
Notification under Sections 309B(1)(a) and 309B(1)(c) of the SFA: We have determined, and hereby notify all relevant
persons (as defined in Section 309A of the SFA) that the Equity Shares are: (A) prescribed capital markets products
(as defined in the Securities and Futures (Capital Markets Products) Regulations 2018) and (B) Excluded Investment
Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment Products and MAS Notice
FAAN16: Notice on Recommendations on Investment Products).
South Africa
The Equity Shares may not be offered or sold and will not be offered or sold to the public (as such term is used in
Chapter 4 of the Companies Act 71 of 2008 (“SA Companies Act”)) in the Republic of South Africa save in the
circumstances where it is lawful to do so without a registered prospectus being made available before the offer is
made. The Placement Document and this Placement Document do not constitute a registered prospectus for the
purposes of and as defined in chapter 4 of the SA Companies Act, and has not been prepared in accordance with the
provisions of the SA Companies Act applicable to the content of a prospectus.
This Placement Document is not to be distributed, delivered or passed on to any person resident in the Republic of
South Africa, unless it is being made only to, or directed only at any person who does not fall within the definition of
the public as contemplated in chapter 4 of the South African Companies Act or any other person to whom an offer of
the Equity Shares in South Africa may lawfully be made (all such persons together being referred to as “permitted
South African offerees”).
This Placement Document must not be acted on or relied on by persons who are not permitted South African offerees.
If the recipient of this Placement Document is in any doubt about the investment to which this document relates, the
recipient should obtain independent professional advice.
Switzerland
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The Equity Shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange
(“SIX”) or on any other stock exchange or regulated trading facility in Switzerland. This Placement Document does
not constitute a prospectus within the meaning of, and has been prepared without regard to the disclosure standards
for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for
listing prospectuses under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or
regulated trading facility in Switzerland. Neither this document nor any other offering or marketing material relating
to the Equity Shares or the offering may be publicly distributed or otherwise made publicly available in Switzerland.
Neither the Preliminary Placement Document and the Placement Document nor any other offering or marketing
material relating to the offering, our Company, the Equity Shares have been or will be filed with or approved by any
Swiss regulatory authority. In particular, this document will not be filed with, and the offer of Equity Shares will not
be supervised by, the Swiss Financial Market Supervisory Authority and the offer of Equity Shares has not been and
will not be authorized under the Swiss Federal Act on Collective Investment Schemes (“CISA”). The investor
protection afforded to acquirers of interests in collective investment schemes under the CISA does not extend to
acquirers of Equity Shares.
Taiwan
The Equity Shares have not been and will not be registered with the Financial Supervisory Commission of Taiwan
pursuant to relevant securities laws and regulations and may not be sold, issued or offered within Taiwan through a
public offering or in circumstances which constitutes an offer within the meaning of the Securities and Exchange Act
of Taiwan that requires a registration or approval of the Financial Supervisory Commission of Taiwan. No person or
entity in Taiwan has been authorized to offer, sell, give advice regarding or otherwise intermediate the offering and
sale of the Equity Shares in Taiwan.
United Arab Emirates (excluding the Dubai International Financial Centre)
This document does not constitute or contain an offer of securities to the general public in the UAE. No offering,
marketing, promotion, advertising or distribution (together, “Promotion”) of this document or the Equity Shares may be
made to the general public in the United Arab Emirates (the “UAE”) unless: (a) such Promotion has been approved by
the UAE Securities and Commodities Authority (the “SCA”) and is made in accordance with the laws and regulations
of the UAE, including SCA Board of Directors’ Chairman Decision no. (3/R.M.) of 2017 (the “Promotion and
Introduction Regulations”), and is made by an entity duly licensed to conduct such Promotion activities in the UAE;
or (b) such Promotion is conducted by way of private placement made: (i) only to “Qualified Investors” (excluding “High
Net Worth Individuals”) (as such terms are defined in the Promotion and Introduction Regulations); or (ii) otherwise
in accordance with the laws and regulations of the UAE; or (c) such Promotion is carried out by way of reverse solicitation
only upon an initiative made in writing by an investor in the UAE. None of the SCA, the UAE Central Bank, the UAE
Ministry of Economy or any other regulatory authority in the UAE has reviewed or approved the contents of this
document nor does any such entity accept any liability for the contents of this document.
Dubai International Financial Centre
This Placement Document relates to an Exempt Offer in accordance with the Markets Rules 2012 of the Dubai
Financial Services Authority (“DFSA”). This Placement Document is intended for distribution only to persons of a
type specified in the Markets Rules 2012 of the DFSA. It must not be delivered to, or relied on by, any other person.
The DFSA has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The
DFSA has not approved this prospectus supplement nor taken steps to verify the information set forth herein and has
no responsibility for this Placement Document. The securities to which this Placement Document relates may be
illiquid and/or subject to restrictions on their resale. Prospective purchasers of the securities offered should conduct
their own due diligence on the securities. If you do not understand the contents of this Placement Document you
should consult an authorized financial advisor.
In relation to its use in the DIFC, this Placement Document is strictly private and confidential and is being distributed
to a limited number of investors and must not be provided to any person other than the original recipient, and may not
be reproduced or used for any other purpose. The interests in the securities may not be offered or sold directly or
indirectly to the public in the DIFC.
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United Kingdom
This Placement Document may not be distributed or circulated to any person in the United Kingdom other than to (i)
persons who have professional experience in matters relating to investments falling within Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Order”); and (ii) high net worth
entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant
persons”). This Placement Document is directed only at relevant persons. Other persons should not act on this Placement
Document or any of its contents. This Placement Document is confidential and is being supplied to you solely for your
information and may not be reproduced, redistributed or passed on to any other person or published, in whole or in
part, for any other purpose.
United States
The Equity Shares have not been and will not be registered under the Securities Act, or the securities laws of any state
of the United States and, unless so registered, may not be offered or sold within the United States, except pursuant to
an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable
U.S. state securities laws. Accordingly, the Equity Shares are being offered and sold only outside the United States in
‘offshore transactions’ (as defined in Regulation S) in reliance on Regulations S and the applicable laws of the
jurisdiction where those offers and sales are made. For further information, see “Transfer Restrictions” on page 182.
Other Jurisdictions
The distribution of this Placement Document and the offer and sale of the Equity Shares may be restricted by law in
certain jurisdictions. Persons into whose possession this Placement Document comes are required to inform
themselves about, and to observe, any such restrictions to the extent applicable.
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TRANSFER RESTRICTIONS
Due to the following restrictions, investors are advised to consult their legal counsel prior to subscribing for Equity
Shares or making any resale, pledge or transfer of the Equity Shares.
Pursuant to Chapter VI of the SEBI Regulations, any resale of Equity Shares, except on a recognized stock exchange,
is not permitted for a period of one year from the date of Allotment. Investors are advised to consult legal counsels
prior to making any resale, pledge or transfer of our Equity Shares. In addition to the above, allotments made to
Eligible QIBs, including VCFs and AIFs, in the Issue may be subject to lock-in requirements, if any, under the rules
and regulations that are applicable to them. For more information, see “Selling Restrictions” on page 174.
United States
The Equity Shares have not been and will not be registered under the Securities Act and may not be offered or sold
within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and applicable state securities laws.
• Each purchaser of the Equity Shares offered in the Issue shall be deemed to have represented, warranted and
acknowledged to and agreed with our Company and the Book Running Lead Managers as follows:
• It is authorised to consummate the purchase of the Equity Shares in compliance with all applicable laws and
regulations.
• It acknowledges (or if it is a broker-dealer acting on behalf of a customer, its customer has confirmed to it that
such customer acknowledges) that the Equity Shares are being issued in reliance upon Regulation S and such
Equity Shares have not been and will not be registered under the Securities Act.
• It certifies that either (A) it is, or at the time the Equity Shares are purchased will be, the beneficial owner of
the Equity Shares and is located outside the United States (within the meaning of Regulation S) or (B) it is a
broker-dealer acting on behalf of its customer and its customer has confirmed to it that (i) such customer is, or
at the time the Equity Shares are purchased will be, the beneficial owner of the Equity Shares, and (ii) such
customer is not located outside the United States (within the meaning of Regulation S).
• It is aware of the restrictions of the offer, sale and resale of the Equity Shares pursuant to Regulation S.
• The Equity Shares have not been offered to it by means of any “directed selling efforts” as defined in Regulation
S.
• It understands that the Equity Shares are being offered in a transaction not involving any public offering in the
United States within the meaning of the Securities Act, that the Equity Shares have not been and will not be
registered under the Securities Act and that if in the future it decides to offer, resell, pledge or otherwise transfer
any of the Equity Shares, such Equity Shares may be offered, resold, pledged or otherwise transferred in
compliance with the Securities Act and other applicable securities laws only outside the United States in a
transaction complying with the provisions of Rule 903 or Rule 904 of Regulation S or in a transaction otherwise
exempt from the registration requirements of the U.S. Securities Act.
• It is a sophisticated investor and has such knowledge and experience in financial, business and investments as
to be capable of evaluating the merits and risks of the investment in the Equity Shares. It is experienced in
investing in private placement transactions of securities of companies in a similar stage of development and in
similar jurisdictions. It and any accounts for which it is subscribing to the Equity Shares (i) are each able to
bear the economic risk of the investment in the Equity Shares, (ii) will not look to the Company or the Book
Running Lead Managers for all or part of any such loss or losses that may be suffered, (iii) are able to sustain
a complete loss on the investment in the Equity Shares, (iv) have no need for liquidity with respect to the
investment in the Equity Shares, and (v) have no reason to anticipate any change in its or their circumstances,
financial or otherwise, which may cause or require any sale or distribution by it or them of all or any part of the
Equity Shares. It acknowledges that an investment in the Equity Shares involves a high degree of risk and that
the Equity Shares are, therefore, a speculative investment. It is seeking to subscribe to the Equity Shares in this
Issue for its own investment and not with a view to distribution.
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• It has been provided access to the Preliminary Placement Document and will be provided access to this
Placement Document which it has read in its entirety.
• It agrees to indemnify and hold the Company and the Book Running Lead Managers harmless from any and all
costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with
any breach of these representations and warranties. It will not hold any of the Company or the Book Running
Lead Managers liable with respect to its investment in the Equity Shares. It agrees that the indemnity set forth
in this paragraph shall survive the resale of the Equity Shares.
• Where it is subscribing to the Equity Shares for one or more managed accounts, it represents and warrants that
it is authorised in writing, by each such managed account to subscribe to the Equity Shares for each managed
account and to make (and it hereby makes) the acknowledgements and agreements herein for and on behalf of
each such account, reading the reference to “it” to include such accounts.
• It agrees that any resale or other transfer, or attempted resale or other transfer, of the Equity Shares made other
than in compliance with the above-stated restrictions shall not be recognised by the Company.
• If such person is a dealer (as such term is defined under the Securities Act), it may not resell the Equity Shares
in the United States prior to 40 days from the commencement of the offering of the Equity Shares. It
acknowledges that the Company and the Book Running Lead Managers and their respective affiliates and others
will rely upon the truth and accuracy of the foregoing acknowledgements, representations and agreements and
agrees that, if any of such acknowledgements, representations or agreements is no longer accurate, it will
promptly notify the Company and the Book Running Lead Managers. It agrees that the terms and provisions of
the foregoing acknowledgements, representations and agreements shall inure to the benefit of and any document
incorporating such acknowledgements, representations and agreements shall be enforceable by the Company,
its successors and its permitted assigns, and the terms and provisions hereof shall be binding on its permitted
successors in title, permitted assigns and permitted transferees. It understands that these acknowledgments,
representations and undertakings are required in connection with United States securities laws and irrevocably
authorizes the Company to produce these acknowledgments, representations and undertakings (or any
document incorporating them) to any interested party in any administrative or legal proceedings or official
enquiry with respect to the matters covered herein.
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THE SECURITIES MARKET OF INDIA
The information in this section has been extracted from documents available on the website of SEBI and the Stock
Exchanges and has not been prepared or independently verified by our Company, the Book Running Lead Managers
or any of their respective affiliates or advisors.
The Indian Securities Market
India has a long history of organised securities trading. In 1875, the first stock exchange was established in Mumbai.
The BSE and the NSE together hold a dominant position among the stock exchanges in terms of the number of listed
companies, market capitalisation and trading activity.
Stock Exchanges Regulation
Indian stock exchanges are regulated primarily by SEBI, as well as by the Government acting through the Ministry of
Finance, Capital Markets Division, under the SCRA and the SCRR. SEBI, in exercise of its powers under the SCRA
and the SEBI Act, notified the SCR (SECC) Rules, which regulate inter alia the recognition, ownership and internal
governance of stock exchanges and clearing corporations in India together with providing for minimum capitalisation
requirements for stock exchanges. The SCRA, the SCRR and the SCR (SECC) Rules along with various rules, bye-
laws and regulations of the respective stock exchanges, regulate the recognition of stock exchanges, the qualifications
for membership thereof and the manner, in which contracts are entered into, settled and enforced between members
of the stock exchanges.
The SEBI Act empowers SEBI to regulate the Indian securities markets, including stock exchanges and intermediaries
in the capital markets, promote and monitor self-regulatory organisations and prohibit fraudulent and unfair trade
practices. Regulations concerning minimum disclosure requirements by public companies, rules and regulations
concerning investor protection, insider trading, substantial acquisitions of shares and takeover of companies, buy-
backs of securities, employee stock option schemes, stockbrokers, merchant bankers, underwriters, mutual funds,
foreign institutional investors, credit rating agencies and other capital market participants have been notified by the
relevant regulatory authority.
Listing and Delisting of Securities
The listing of securities on a recognised Indian stock exchange is regulated by the applicable Indian laws including
the Companies Act, the SCRA, the SCRR, the SEBI Act, SEBI Listing Regulations and various guidelines and
regulations issued by the SEBI and the stock exchanges. The SCRA empowers the governing body of each recognised
stock exchange to suspend trading of or withdraw admission to dealings in a listed security for breach of or non-
compliance with any conditions or breach of company’s obligations under the SEBI Listing Regulations or for any
reason, subject to the issuer receiving prior written notice of the intent of the exchange and upon granting of a hearing
in the matter.
SEBI has notified the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009, in
relation to the voluntary and compulsory delisting of equity shares from the stock exchanges. In addition, certain
amendments to the SCRR have also been notified in relation to delisting.
Minimum Level of Public Shareholding
All listed companies are required to ensure a minimum public shareholding at 25%. Further, where the public
shareholding in a listed company falls below 25% at any time, such company is required to bring the public
shareholding to 25% within a maximum period of 12 months from the date of such fall. Consequently, a listed
company may be delisted from the stock exchanges for not complying with the above-mentioned requirement. Our
Company is in compliance with this minimum public shareholding requirement. Further, pursuant to the budget 2019-
2020, SEBI has been authorised to consider increasing the minimum public shareholding requirement to 35%.
Index-Based Market-Wide Circuit Breaker System
In order to restrict abnormal price volatility in any particular stock, the SEBI has instructed stock exchanges to apply
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daily circuit breakers which do not allow transactions beyond a certain level of price volatility. The index-based
market-wide circuit breaker system (equity and equity derivatives) applies at three stages of the index movement, at
5%, 10%, 15% and 20%. These circuit breakers, when triggered, bring about a co-ordinated trading halt in all equity
and equity derivative markets nationwide. The market-wide circuit breakers are triggered by movement of either the
SENSEX of the BSE or the S&P CNX NIFTY of the NSE, whichever is breached earlier.
In addition to the market-wide index-based circuit breakers, there are currently in place individual scrip-wise circuit
breakers. However, no price bands are applicable on scrips on which derivative products are available or scrips
included in indices on which derivative products are available.
The stock exchanges in India can also exercise the power to suspend trading during periods of market volatility.
Margin requirements are imposed by stock exchanges that are required to be paid by the stockbrokers.
BSE
Established in 1875, it is the oldest stock exchange in India. In 1956, it became the first stock exchange in India to
obtain permanent recognition from the Government under the SCRA. It has evolved over the years into its present
status as one of the premier stock exchanges of India.
NSE
The NSE was established by financial institutions and banks to provide nationwide online, satellite-linked, screen-
based trading facilities with market-makers and electronic clearing and settlement for securities including government
securities, debentures, public sector bonds and units. It has evolved over the years into its present status as one of the
premier stock exchanges of India. The NSE was recognised as a stock exchange under the SCRA in April 1993 and
commenced operations in the wholesale debt market segment in June 1994. The capital market (equities) segment
commenced operations in November 1994 and operations in the derivatives segment commenced in June 2000. NSE
launched the NSE 50 Index, now known as S&P CNX NIFTY, on April 22, 1996 and the Mid-cap Index on January
1, 1996.
Internet-based Securities Trading and Services
Internet trading takes place through order routing systems, which route client orders to exchange trading systems for
execution. Stockbrokers interested in providing this service are required to apply for permission to the relevant stock
exchange and also have to comply with certain minimum conditions stipulated by SEBI. The NSE became the first
exchange to grant approval to its members for providing internet-based trading services. Internet trading is possible
on both the “equities” as well as the “derivatives” segments of the NSE.
Trading Hours
Trading on both the NSE and the BSE occurs from Monday to Friday, between 9:15 a.m. and 3:30 p.m. IST (excluding
the 15 minutes pre-open session from 9:00 a.m. to 9:15 a.m.). The BSE and the NSE are closed on public holidays.
The recognised stock exchanges have been permitted to set their own trading hours (in the cash and derivatives
segments) subject to the condition that (i) the trading hours are between 9.00 a.m. and 5.00 p.m.; and (ii) the stock
exchange has in place a risk management system and infrastructure commensurate to the trading hours.
Trading Procedure
In order to facilitate smooth transactions, the BSE replaced its open outcry system with BSE On-line Trading facility
in 1995. This totally automated screen based trading in securities was put into practice nation-wide. This has enhanced
transparency in dealings and has assisted considerably in smoothening settlement cycles and improving efficiency in
back-office work.
NSE has introduced a fully automated trading system called NEAT, which operates on strict time/price priority besides
enabling efficient trade. NEAT has provided depth in the market by enabling large number of members all over India
to trade simultaneously, narrowing the spreads.
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SEBI Listing Regulations
Public listed companies are required under the SEBI Listing Regulations to prepare and circulate to their shareholders
audited annual accounts which comply with the disclosure requirements and regulations governing their manner of
presentation and which include sections relating to corporate governance, related party transactions and management’s
discussion and analysis as required under the SEBI Listing Regulations. In addition, a listed company is subject to
continuing disclosure requirements pursuant to the terms of the SEBI Listing Regulations.
SEBI Takeover Regulations
Disclosure and mandatory bid obligations for listed Indian companies are governed by the SEBI Takeover Regulations
which provide specific regulations in relation to substantial acquisition of shares and takeover. The SEBI Takeover
Regulations prescribes certain thresholds or trigger points in the shareholding a person or entity has in the listed Indian
company, which give rise to certain obligations on part of the acquirer. Acquisitions up to a certain threshold
prescribed under the SEBI Takeover Regulations mandate specific disclosure requirements, while acquisitions
crossing particular thresholds may result in the acquirer having to make an open offer of the shares of the target
company. The SEBI Takeover Regulations also provides for the possibility of indirect acquisitions, imposing specific
obligations on the acquirer in case of such indirect acquisition.
SEBI Insider Trading Regulations
The SEBI Insider Trading Regulations have been notified to prohibit and penalise insider trading in India. An insider
is, among other things, prohibited from dealing in the securities of a listed company when in possession of unpublished
price sensitive information (“UPSI”). The SEBI Insider Trading Regulations, inter alia, impose certain restrictions
on the communication of information by listed companies. Under the SEBI Insider Trading Regulations, (i) no insider
shall communicate, provide or allow access to any UPSI relating to such companies and securities to any person
including other insiders; and (ii) no person shall procure or cause the communication by any insider of UPSI relating
to such companies and securities, except in furtherance of legitimate purposes, performance of duties or discharge of
legal obligations. However, UPSI may be communicated, provided or allowed access to or procured, under certain
circumstances specified in the SEBI Insider Trading Regulations. The SEBI Insider Trading Regulations make it
compulsory for listed companies and certain other entities that are required to handle UPSI in the course of business
operations to establish an internal code of practices and procedures for fair disclosure of UPSI and to regulate, monitor
and report trading by insiders. To this end, the SEBI Insider Trading Regulations provide principles of fair disclosure
for purposes of code of practices and procedures for fair disclosure of UPSI and minimum standards for code of
conduct to regulate, monitor and report trading by insiders. There are also initial and continuing shareholding
disclosure obligations under the SEBI Insider Trading Regulations. The SEBI Insider Trading Regulations also
provides for disclosure obligations for promoters, employees and directors, with respect to their shareholding in the
company, and the changes therein.
Depositories
The Depositories Act provides a legal framework for the establishment of depositories to record ownership details and
effect transfer in book-entry form. Further, SEBI framed regulations in relation to the registration of such depositories,
the registration of participants as well as the rights and obligations of the depositories, participants, companies and
beneficial owners. The depository system has significantly improved the operation of the Indian securities markets.
Derivatives (Futures and Options)
Trading in derivatives is governed by the SCRA, the SCRR and the SEBI Act. The SCRA was amended in February
2000 and derivatives contracts were included within the term “securities”, as defined by the SCRA. Trading in
derivatives in India takes place either on separate and independent derivatives exchanges or on a separate segment of
an existing stock exchange. The derivatives exchange or derivatives segment of a stock exchange functions as a self-
regulatory organisation under the supervision of the SEBI.
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DESCRIPTION OF THE EQUITY SHARES
The following is information relating to the Equity Shares including a brief summary of the Memorandum, Articles of
Association and the Companies Act. Prospective Investors are urged to read the Memorandum and Articles of
Association carefully, and consult with their advisers, as the Memorandum and Articles of Association and applicable
Indian law, and not this summary, govern the rights attached to the Equity Shares. Capitalised terms used and not
defined herein, shall have the same meaning as ascribed to such words in the Memorandum and Articles of
Association.
General
The authorised share capital of our Company is Rs. 11,00,00,00,000 divided into 1,80,00,00,000 Equity Shares of face
value of Rs. 5 each and 20,00,000, 7.50% non-cumulative redeemable preference shares of face value of Rs. 1,000
each. As on the date of this Placement Document, the issued, subscribed and paid-up capital of our Company is Rs.
462,60,90,000 divided into 92,52,18,000 Equity Shares.
Memorandum and Articles of Association
Our Company is governed by its Memorandum and Articles of Association.
Main objects of our Company
The main objects contained in the Memorandum of Association of our Company are as follows:
1. To take over from the National Mineral Development Corporation Ltd., a Central Government Company
registered under the Companied Act, 1956 all the plans, projects, schemes and studies etc. pertaining to the
exploration, exploitation, mining and the like of copper and copper ore and specifically the Khetri Kolihun
Copper Project (including sulphuric acid and fertiliser plant), Rakha and Agnigundala Copper Projects and other
utilized manners along with the assets and liabilities concerning such work.
2. To carry on in India and elsewhere trades or business of metallurgists and miners including beneficiation of
minerals, mineral dressing, concentration, smelting, refining and the extraction, manufacture and fabrication,
purchase and sale of and generally dealing in all metals and their products and alloys and in particular to
manufacture and/or produce and/or otherwise engage generally in the manufacture or production of or dealing
in ores and concentrates of Copper, Zinc, brass and lead, zinc and land metals and their products and bye -
products of all kinds and fertilizers, sulphuric and other acids, chloride and other chemical products and the sale,
dealing or other disposition of such products and bye products.
3. To search, prospect, get, win, work, raise, beneficiate, make merchantable, sell, dispose of and deal in all minerals
and substances and the manufacture and sale of produce obtained thereby.
4. To mine quarry, beneficiate, concentrate, dress, smelt, refine, manufacture, process, fabricate, purchase or
otherwise acquire, sell or otherwise dispose or deal in ores containing copper, lead, cine or cadmium,
concentrates of copper, lead and zinc, copper, lead and zinc alloys and compounds, copper, lead and zinc goods,
wares and products of all kinds, fertilizers, chemicals, compounds of metals and minerals or other materials of
every kind needed for or resulting from the mining, production, purchase or processing of ores containing copper,
lead and zinc or cadmium, copper, lead, zinc, cadmium metals and their products of every kind.
5. To search for, inspect, prospect, examine, explore, mine, quarry, purchase or otherwise acquire in India or
elsewhere in the world, ores containing copper, lead, zinc or cadmium, concentrates of copper, lead and zinc
copper, lead and zinc metals and their products and all other metals, minerals and minerals substances of every
kind, which may be of direct or indirect use in the production of copper, lead, zinc, cadmium and other metals or
which may result as incidental to or bye- products of any of them.
6. To buy, sell, smelt, refine, manufacture, fabricate and deal in minerals and metals alloys of all kind.
7. To develop consultancy services in the field of copper mining, concentrating, smelting, refining and act as
consulting engineers and metallurgists in all field of engineering and metallurgy and to carry on the business of
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mechanical, metallurgical, mining, chemical, electrical and civil engineering including in particular the work of
selling, erecting, installing, operating, maintaining and repairing all types of plant, machinery and equipment.
8. To undertake, carry on, or cause to be carried on, and assist contribute in any form, research in all fields of
metallurgy and engineering in India elsewhere and to construct, execute, carry out, equip improve, work,
purchase or other-wise acquire, hire, lease, develop, administer, manage, control in India or elsewhere
laboratories, technical training educational institutes schools or colleges.
Dividends
Under Indian law, a company pays dividend upon a recommendation by its board of directors and approval by a
majority of the shareholders at the AGM held each Fiscal year. Under the Companies Act, unless the board of directors
of a company recommends the payment of a dividend, the shareholders at a general meeting have no power to declare
any dividend. Subject to certain conditions laid down by Section 123 of the Companies Act, 2013, no dividend can be
declared or paid by a company for any Fiscal year except out of the profits of the company for that year, calculated in
accordance with the provisions of the Companies Act or out of the profits of the company for any previous Fiscal
year(s) arrived at in accordance with the provisions of the Companies Act. According to the Articles of Association,
the amount of dividends shall not exceed the amount recommended by the Board of Directors. However, our Company
may declare a lesser dividend in the general meeting. In addition, as is permitted by the Articles of Association, the
Board of Directors may pay interim dividend at such intervals as it may think fit, subject to the requirements of the
Companies Act. Additionally, in terms of the CPSE Capital Restructuring Guidelines, all central public sector
enterprises are required to pay a minimum annual dividend of 30% of profit after tax or 5% of the net-worth, whichever
is higher, subject to the maximum dividend permitted under the extant legal provisions.
The Equity Shares issued pursuant to this Placement Document shall rank pari passu with the existing Equity Shares
in all respects including entitlements to any dividends that may be declared by our Company.
Bonus issue and capitalisation of profits
In addition to permitting dividends to be paid out of current or retained earnings as described above, the Companies
Act permits the board of directors, if so approved by the shareholders in a general meeting, to distribute an amount
transferred in the free reserves, the securities premium account or the capital redemption reserve account to its
shareholders, in the form of fully paid up bonus shares. These bonus shares must be distributed to shareholders in
proportion to the number of shares owned by them as recommended by the board of directors. Further, any issue of
bonus shares would be subject to SEBI ICDR Regulations and the Companies Act, 2013.
As per the Articles of Association, our Company in its general meeting may, upon the recommendation of the Board,
resolve that any monies, investments or other assets forming part of the undivided profits of our Company standing to
the credit of the reserve fund or any capital redemption reserve account, or in the hands of our Company and available
for dividend (or representing premiums received on the issue of shares and standing to the credit of the share premium
account) be capitalised and distributed amongst such of the Shareholders as would be entitled to receive the same if
distributed by way of dividend and in the same proportions on the footing that they become entitled thereto as capital
and that all or any part of such capitalised fund be applied on behalf of such shareholders in paying up in full, either
at par or at such premium as the resolution may provide, any unissued shares or debentures or debenture stock of our
Company while shall be distributed accordingly or in or towards payment of the uncalled liability on any issued shares
or debentures or debenture stock and that such distribution or payment shall be accepted by such shareholders in full
satisfaction of their interest in the said capitalised sum.
Share capital
Subject to the provisions of the Companies Act, our Company may increase its share capital by issuing new shares on
such terms and with such rights as it, by action of its shareholders in a general meeting may determine. According to
Section 62 of the Companies Act, 2013, such new shares shall be offered to existing shareholders in proportion to the
amount paid up on those shares at that date. The offer shall be made by notice specifying the number of shares offered
and the date (being not less than 15 days and not exceeding 30 days from the date of the offer) within which the offer,
if not accepted, will be deemed to have been declined. After such date, the board of directors of a company may
dispose of the shares offered in respect of which no acceptance has been received in a manner which shall not be
189
disadvantageous to the shareholders of a company. The offer is deemed to include a right exercisable by the person
concerned to renounce the shares offered to him in favour of any other person.
Under the provisions of Section 62(1)(c) of the Companies Act, 2013, new shares may be offered to any persons
whether or not those persons include existing shareholders, either for cash or for a consideration other than cash, if
the price of such shares is determined by the valuation report of a registered valuer subject to such conditions as may
be prescribed, if a special resolution to that effect is passed by the company’s shareholders in a general meeting.
The Articles of Association authorise our Company to, from time to time, increase its share capital by such sum, to be
divided into shares of such amount, as may be specified pursuant to a resolution. Subject to the provisions of Section
61 of the Companies Act and the Articles of Association, 2013, the share capital of our Company (whether original,
increased or reduced), may be sub divided, consolidated or divided into such classes of shares as may be allowed
under the law for the time being in force relating to companies with such privileges or rights as may be attached and
to be held upon such terms as may be prescribed by the Regulations of the Company. Provided that certain of these
actions such as the division of share capital into different classes of shares may require prior permission from the
Government of India.
Pre-emptive rights and issue of additional shares
The Companies Act, 2013 gives shareholders the right to subscribe for new shares in proportion to their existing
shareholdings unless otherwise determined by a resolution passed by three-fourths of the shareholders present and
voting at a general meeting. Under the Companies Act, 2013 and the Articles, in the event of an issuance of securities,
subject to the limitations set forth above, our Company must first offer the new Equity Shares to the holders of Equity
Shares on a fixed record date. The offer, required to be made by notice, must include:
• the right exercisable by the shareholders as on record date, to renounce the Equity Shares offered in favour of any
other person;
• the number of Equity Shares offered; and
• the period of the offer, which may not be less than 15 days from the date of the offer and shall not exceed thirty
days. If the offer is not accepted, it is deemed to have been declined.
The Board is permitted to distribute Equity Shares not accepted by existing shareholders in the manner it deems
beneficial for us in accordance with the Articles.
General meetings of shareholders
There are two types of general meetings of the shareholders:
(1) AGM; and
(2) EGM.
Our Company must hold its AGM within six (6) months after the expiry of each Fiscal year provided that not more
than 15 months shall elapse between the AGM and next one, unless extended by the RoC at its request for any special
reason for a period not exceeding three (3) months. The Board of Directors may convene an EGM when necessary or
at the request of a shareholder or shareholders holding in the aggregate not less than one tenth of our Company’s paid
up share capital, in accordance with Section 100 of the Companies Act, 2013.
Notices, either in writing or through electronic mode, convening a meeting setting out the date, day, hour, place and
agenda of the meeting must be given to members at least 21 clear days prior to the date of the proposed meeting. A
general meeting may be called after giving shorter notice if consent is received, in writing or electronic mode, from
not less than 95% of the shareholders entitled to vote. No general meeting, annual or extraordinary, shall be competent
to enter upon, discuss or transact any business which has not been mentioned in the notice or notices upon which it
was convened.
A company intending to pass a resolution relating to matters including but not limited to, amendment in the objects
clause of the memorandum of association, the issuing of shares with different voting or dividend rights, a variation of
the rights attached to a class of shares or debentures or other securities, buy-back of shares, giving loans or extending
guarantees in excess of limits prescribed under the Companies Act, 2013, is required to obtain the resolution passed
190
by means of a postal ballot instead of transacting the business in the company’s general meeting. A notice to all the
shareholders shall be sent along with a draft resolution explaining the reasons therefore and requesting them to send
their assent or dissent in writing on a postal ballot within a period of 30 days from the date of posting the letter. Such
postal ballot includes procedure for voting by electronic mode.
Voting rights
Subject to any rights or restrictions for the time being attached to any class or classes of shares on a show of hands,
every member present in person shall have one vote; and on a poll, the voting rights of members shall be in proportion
to his share in the paid-up equity share capital of the company.
A member may exercise his vote at a meeting by electronic means in accordance with Section 108 and shall vote only
once. The instrument appointing a proxy and the power-of-attorney or other authority, if any, under which it is signed
or a notarised copy of that power or authority, shall be deposited at the Registered and Corporate Office of the company
not less than 48 hours before the time for holding the meeting at which the person named in the instrument proposes
to vote, or, in the case of a poll, not less than 24 hours before the time appointed for the taking of the poll; and in
default the instrument of proxy shall not be treated as valid. An instrument appointing a proxy shall be in the form as
prescribed in the rules made under Section 105 of the Companies Act, 2013.
Transfer of shares
The equity shares held through depositories are transferred in the form of book entries or in electronic form in
accordance with the regulations laid down by SEBI. These regulations provide the regime for the functioning of the
depositories and the participants and set out the manner in which the records are to be kept and maintained and the
safeguards to be followed in this system. Transfers of beneficial ownership of shares held through a depository are
exempt from stamp duty. Our Company has entered into an agreement for such depository services with the NSDL
and CDSL. SEBI requires that the shares for trading and settlement purposes be in book-entry form for all investors,
except for transactions that are not made on a stock exchange and transactions that are not required to be reported to
the stock exchange. Our Company shall keep a book in which every transfer or transmission of shares will be entered.
Pursuant to the SEBI Listing Regulations, in the event our Company has not effected the transfer of shares within 15
days or where our Company has failed to communicate to the transferee any valid objection to the transfer within the
stipulated time period of 15 days, it is required to compensate the aggrieved party for the opportunity loss caused
during the period of the delay. The Equity Shares shall be freely transferable, subject to applicable laws.
Buy-back
Our Company may buy back its own Equity Shares or other specified securities subject to the provisions of the
Companies Act, and any related SEBI guidelines issued in connection therewith.
Liquidation rights
If a company is wound up, whether voluntarily or otherwise, the liquidator may, with the sanction of a special
resolution and any other sanction required by the Companies Act, 2013, divide amongst the members, in specie or in
kind, the whole or any part of the assets of the company and may, with the same sanction, vest the whole or any part
of such assets in trustees upon such trusts for the benefit of the contributories, as the liquidator, with the like sanction
shall think fit, but so that no member shall be compelled to accept any shares or other securities whereon there is any
liability. The liquidator may set any such value upon any property to be divided as he deems fair and how such division
shall be carried out between the members or different classes of members.
191
STATEMENT OF TAX BENEFITS
STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO THE COMPANY AND ITS
SHAREHOLDERS UNDER THE APPLICABLE LAWS IN INDIA
To,
A) The Board of Directors
Hindustan Copper Limited,
1, Ashutosh Chowdhury Avenue,
Kolkata – 700019
West Bengal, India
B) IDBI Capital Markets & Securities Limited
6th floor, IDBI Tower,
World Trade Centre
Cuffe Parade,
Mumbai 400 005,
Maharashtra, India
C) SBI Capital Markets Limited
202, Maker Tower “E”,
Cuffe Parade
Mumbai 400 005,
Maharashtra, India
(B & C referred to hereinafter as the “Lead Managers”)
Re: Proposed qualified institutions placement of equity shares of face value of Rs. 5 each (the “Equity Shares”) of
Hindustan Copper Limited (the “Company”) in reliance upon Section 42 of the Companies Act, 2013, as
amended and the rules framed there under and Chapter VI of the Securities and Exchange Board of India (Issue
of Capital and Disclosure Requirements) Regulations, 2018 as amended (“ICDR”) (the “Issue”)
Sub: Certificate on possible tax benefits available to the Company and its shareholders
Dear Sirs,
1) This report is in accordance with the terms of the engagement letter dated 22nd February 2021 with the Company.
Management’s Responsibility
2) The preparation and maintenance of all accounting and other relevant supporting records is the responsibility
of the management of the Company.
3) The management of the Company is also responsible for ensuring that the Company complies with the
requirements of the ICDR and provides all relevant information to National Stock Exchange of India Limited
(“NSE”) and BSE Limited (“BSE”) (together, the “Stock Exchanges”) as may be required under the applicable
law.
4) The management is also responsible for reviewing the tax law and applicable regulations prevailing as on the
date of this certificate, compute possible tax benefits available to the Company and its shareholders under the
Income Tax Act, 1961 (read with Income Tax Rules, circulars, notifications) and under Indirect Tax laws as
amended by the Finance Act, 2021
Auditors’ Responsibility
192
5) It is our responsibility to provide a statement of on possible tax benefits available to the Company and its
shareholders under direct and indirect tax laws as certified by the management.
6) In addition to the foregoing, our scope of work did not include verification of compliance with other
requirements of the ICDR, other circulars, notifications, etc. as issued by relevant regulatory authorities from
time to time and any other laws and regulations applicable to the Company. Further, our scope of work did not
involve performing audit tests for the purpose of expressing an opinion on the fairness or accuracy of any of
the financial information or the financial statements of the Company, taken as a whole nor a review made in
accordance with the generally accepted auditing standards in India and consequently, no assurance is expressed;
7) We have complied with the relevant applicable requirements of the Standard on Quality Control (SQC) 1,
“Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and other
Assurance and Related Services Engagements”.
8) Our engagement was undertaken in accordance with the Standard on Related Services (SRS) 4400,
“Engagements to Perform Agreed-Upon Procedures regarding Financial Information”, issued by the Institute
of Chartered Accountants of India. The procedures were performed solely to assist you in evaluating and
provide a statement on the possible tax benefits available to the Company and its shareholders.
Opinion
9) Based on our engagement procedure performed as mentioned above:-
a) We hereby enclosed the certificate in Annexure A, on possible tax benefits which as per the
management available to the Company and its shareholders under the Income Tax Act, 1961 (read with
Income Tax Rules, circulars, notifications) and under Indirect Tax laws as amended.
b) We hereby report that our certificate is based on the understanding of the law and applicable regulations
prevailing as on the date of this certificate. Any change or amendment in the law would necessitate a
review of our certificate. Unless specifically requested, we have no responsibility to carry out any
review of our certificate for change in law occurring after the date of issue of the certificate.
c) Based on our review procedure adopted, we hereby report that the information in Annexure A is true,
complete and not misleading, and may be reproduced in the Preliminary Placement Document and
Placement Document and any other document prepared in connection with the Issue.
Restriction on use
10) This certificate has been issued at the request of the Company for use in connection with the Issue. The contents
of this certificate, in full or part, can be disclosed in the preliminary placement document and the placement
document and the other documents or materials in relation to the issue and may accordingly be furnished as
required to the Stock Exchanges, Securities and exchange Board of India or any other regulatory authorities as
required, and shared with and relied on as necessary by the Lead Managers and other intermediaries duly
appointed in this regard and we undertake to immediately intimate the Lead Managers and the legal counsels
in case of any changes to the above. In the absence of any such communication, you may assume that there is
no change in respect of the matters covered in this certificate.
For Chaturvedi & Co., Chartered Accountants
Firm Registration Number: 302137E
R.K. Nanda
Partner
194
ANNEXURE A TO THE STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO THE
COMPANY AND ITS SHAREHOLDERS UNDER THE APPLICABLE TAX LAWS IN INDIA
The information provided below sets out the possible tax benefits available to the Company and its shareholders under
the Act presently in force in India. It is not exhaustive or comprehensive and is not intended to be a substitute for
professional advice. Investors are advised to consult their own tax consultants with respect to the tax implications of
an investment in the equity shares particularly in view of the fact that certain recently enacted legislation may not have
a direct legal precedent or may have a different interpretation on the benefits, which an investor can avail.
You should consult your tax advisors concerning the Indian tax implications and consequences of purchasing, owning
and disposing of equity shares in a particular situation.
I. Taxability under Income Tax Act, 1961 and other tax laws in India
(a) Special Tax Benefit available to the Company and its Shareholders
There is no special tax benefit available to the Company and its Shareholders under Income Tax Act, 1961
and other tax laws in India
(b) General Tax Benefits available to the Company and its Shareholders under the Income Tax Act, 1961
The Company has exercised the option under Section 115BAA of the Income Tax Act, 1961 w.e.f. assessment
year 2020-2021, the following two distinct income tax benefits are available to the Company
i. The applicable rate of Income Tax (Surcharge and Health and Education Cess) has been reduced
from the erstwhile 34.944% to 25.168% and
ii. There will not be any applicability of the provisions of the Minimum Alternate Tax (MAT) under
Section 115JB of the Income Tax Act, 1961
195
LEGAL PROCEEDINGS
Our Company and the Subsidiaries are, from time to time, involved in various litigation proceedings in the ordinary
course of our business. These legal proceedings are in the nature of, among others, civil suits, criminal proceedings
regulatory actions and tax proceedings.
Pursuant to the “Policy for determination of materiality of events and information for disclosure to the Stock
Exchanges”, as followed by our Company, an event or information is considered to be material on the basis of quantity
if the impact of such event or information on the Company exceeds 10% of its turnover or 10% of its net worth,
whichever is higher, as per our Audited Financial Statements of the previous year. Accordingly, all outstanding civil
litigation involving any of the Company, its Subsidiary and/or its Joint Venture, which involve an amount equivalent
to or above Rs 8,031.66 lakhs which is approximately 10% of the turnover of the Company as per the audited
standalone financial statements of the Company as of and for the financial year ended March 31, 2020, have been
disclosed in this section.
In case where the materiality of event or information cannot be determined on the basis of quantitative threshold given
above, then such even or information is considered material if such non-disclosure of the event/ information is likely
to result in discontinuity or alteration of the event/information already available in public domain or it is expected
that if the event/information subsequently comes in public domain, it will impact the market price of the Company’s
shares exceeding 15% or more, wholly attributable to such event/information, or if the event is material in the opinion
of the Board of Directors.
Further, other than as disclosed in this section no other litigation has been treated as material in the opinion of the
Board of Directors which may have, or have had, a material adverse effect on the business, financial condition, cash
flows or operations of our Company.
It is clarified that for the purposes of the above, pre-litigation notices received by our Company, Subsidiary or
Directors shall, unless otherwise decided by our Board of Directors, not be considered as litigation until such time
that our Company or Subsidiary or Directors, as the case may be, is impleaded as a defendant in litigation proceedings
before any judicial forum.
A. Litigation involving our Company
Criminal proceedings
1. Deb Kumar Choudhary, the General Manager of our Company has filed a petition before the High Court of
Jharkhand for quashing of entire criminal proceedings initiated against him before the Court of Additional
Chief Judicial Magistrate, Ghatsila under Section 33 of the Indian Forest Act, 1927 and Bihar Amendment Act
9 of 1990. The Forest Department, Jharkhand alleged that Deb Kumar Choudhary was involved in illegal
mining activity being carried out on forest land. The High Court of Jharkhand has granted a stay against the
criminal proceedings initiated against him. The matter is currently pending.
2. A first information report has been filed against several persons including Sanjay Kumar singh, unit head of
ICC and Deepak Srivastava, DGM (projects) in relation to the suicide committed by one of the contractors of
the Company before the Civil Court, East Singhbhum. It has been alleged that the contractor committed suicide
due to change in terms of a tender of the Company which impacted the contractor and ruined his life. The
matter is currently pending.
3. Our Company has filed multiple First Information Reports against certain individuals under Section 394, 307
and 333 of the Indian Penal Code, 1860, in relation to the robbery and theft committed by such individuals.
The matters are currently pending
4. Our Company received a notice from the Sub-Divisional Officer, Khetri under Section 133 of the Code of
Criminal Procedure, 1973, for creation of nuisance and directing our general manager to resolve the nuisance
arising out of the agitation (Dharana & Bundh) organized by the villagers of Kharakada-Tiawali area for repair
of KCC road from Kharakada to Tilawali. We have also been directed to provide clarification regarding the
charges levelled by the villagers for the irregularities that appear in our recruitment at Khetri Nagar. The said
matter is pending before Sub-Divisional Officer, Khetri.
196
5. A complaint was filed against our Company for cutting of trees and farmland at the river side in the Jasrapur
village. Basis the complaint, an enquiry was conducted by the deputy Tehsildar and as per the report of the
enquiry, the land belongs to the Government of Rajasthan. Accordingly, the Tehsildar, Khetri has filed a
petition against our Company for interalia cutting off trees without permission. The said matter is pending
before Sub-Divisional Officer, Khetri.
6. Our Company has filed a complaint against Unicon Connectors Private Limited before the Court of
Metropolitan Magistrate, Ballard Pier, under Section 138 of the Negotiable Instruments Act, 1881, for
dishonouring eight cheques totalling to Rs. 79,30,603. The matter is currently pending.
7. Our Company has filed an interlocutory application before the High Court of Jharkhand, at Ranchi, for direction
of payment of compensation in terms of Section 357 of the Code of Criminal Procedure in the matter of Maithon
Ceremics Private Limited (“Accused”) versus the Union of India should the order of the trial court convicting
the Accused of the offence under Section 420 and 120B of the Indian Penal Code, 1860 and imposing a fine of
Rs. 50.00 lakhs be upheld, in relation to the wrongful loss suffered by the Company from the actions of the
accused of an amount to the extent of Rs. 20.00 lakhs. The matter is currently pending.
8. Our Company has filed a first information report against Mirzapur Electrical Industries Limited and two of its
directors under Section 406, 420, 467, 468, 471 and 201 read with Section 120 B of the Indian Penal Code,
1860 for causing wrongful loss to the Company by delaying in returning a transformer of a Company which is
valued at around Rs. 380 lakhs which was given to the accused to carry out repair works. The matter is currently
pending before the Court of Additional Chief Judicial Magistrate, Ghatsila.
Motor accident claims
There are certain motor accident claims against our Company, filed in relation to certain motor accidents that occurred
while our Company‘s drivers were on duty.
Regulatory and Statutory Matters
Our Company has received certain statutory notices, the details of which are below.
1. The Regional Officer, Jharkhand State Pollution Control Board has filed a complaint against our Company,its
erstwhile mine managers and agents of the mines before the Chief Judicial Magistrate at Jamshedpur, East
Singhbhum under Section 15 of the Environmental Protection Act, 1986 alleging that our Company has made
production of copper ores from the Surda mine in the year 1992-93 to 2017-18 and 2018-19 without obtaining
environmental clearance which is violation of the Environmental Protection Act, 1986. The matter is currently
pending.
2. Our company has filed a revision application to the Central Government under Rule 35(1) of the Mineral (Other
than Atomic and Hydrocarbons Energy Minerals) Concession Rules, 2016, against the order passed by the
District Mining Officer, Singhbhum East, Jamshedpur, wherein the District Mining Officer, Singhbhum East,
Jharkhand, demanded Rs. 43,53,77,779 as 100% recovery of the price of the extracted mineral owing to the
absence of a valid environmental clearance in our favour. Subsequently, the District Mining Officer,
Singhbhum East, Jharkhand further raised a demand of Rs. 1,26,90,46,852 vide a notice dated May 4, 2018
which was further revised to Rs. 9,29,40,06,242 vide notice dated October 24, 2018. The matter is currently
pending.
3. Nandish H.N. and P.K. Kundalia, the Deputy General Manager of our Company has received a letter from the
Inspector of Factories, Government of Jharkhand under Section 92 of the Factories Act, 1948 and Jharkhand
Factories Rules, 1950, for non-competent inspection of lifting tools, tackles and pressure vessels at our factory.
Pursuant to the letter a case has been filed against our Deputy General Manager before the Court of Additional
Chief Judicial Magistrate, Ghatsila. In response to the same, we have filed a petition before the High Court of
Jharkhand and a stay has been granted. The matter is currently pending.
197
4. Our Company has received a notice from the Sub-Divisional Officer, Khetri, under section 84/86 of the
Rajasthan Tenancy Act, 1955, for removal of trees. The matter is currently pending before the Sub-Divisional
Officer, Khetri.
5. Our Company received a show cause notice under Rule 73(f) of the Maharashtra Factories Rules, 1963,
pursuant to a fatal accident which occurred at our factory while repairing the roof. Subsequently, a First
Information Report was filed against our manager and the matter is currently pending before the Court of Chief
Judicial Magistrate, Alibag.
Public Interest Litigation
The High Court of Jharkhand, Ranchi, suo moto filed a writ petition against the State of Jharkhand and other corporate
entities, including our Company to examine the compliance of coal fired thermal power plants spread over various
States in the country with the safety standards and the rules and regulations relating to health and medical treatment
of their employees. This writ petition is arising out of the Supreme Court judgment where the petitioner, an NGO,
Occupational Health and Safety Association, filed a PIL against Union of India. The Secretary General of Supreme
Court gave directions to various High Courts to examine the health hazards of common workers working in their
respective thermal power stations. The matter is currently pending.
Civil Cases
Our Company has filed multiple complaints under Section 452 of the Companies Act, 2013, before various courts
against its current and former officers and employees on grounds of wrongful possession of the premises of the
Company or unauthorised occupation of the property of our Company after their retirement or termination or
superannuation. The matters are currently pending before various courts.
Labour/Employment
There are certain proceedings filed against us by various individuals on grounds including illegal termination of
employment, wage arrears, withholding of promotion and delayed payment or non-payment of statutory dues such as
provident fund dues or pension or gratuity. The amounts involved in these matters are not ascertainable. All of these
matters are currently pending.
Tax Matters
1. The Municipal Council, Malanjkhand, raised a demand on Malanjkhand Copper Project (MCP) amounting to
Rs. 70,46,64,291.29 lakhs on account of penalty on terminal tax for the periods from Fiscal 2000-01 to 2005-
06 on the ground of short payment of terminal tax by adopting higher assessable value as well as higher of
metal in ore produced and metal in concentrate despatched. The matter was contested by the company before
the High Court of Madhya Pradesh and the company paid under protest Rs. 3,52,33,213 towards penalty as per
the order of the High Court of Madhya Pradesh. Subsequently the matter was turned down by the High Court
of Madhya Pradesh. The Company filed a writ petition before the Supreme Court of India. The Supreme Court
vide its order directed the Company to deposit an ad-hoc amount of Rs. 10,00,00,000 to the Municipal Council,
Malanjkhand, which has been deposited by our Company and also ordered that the matter may be heard on the
ground of merit by the Civil Court, Baihar. Further an additional demand of Rs. 188,67,56,075 for the periods
from 2006-07 to 2011-12 was also raised on the above mentioned grounds for which our Company has filed a
special leave petition before the Supreme Court of India. The matters are currently pending.
2. The details with respect to direct tax and indirect tax proceedings involving our Company are set out below:
S.
No
Particulars Number of
cases
Aggregate amount involved (in Rs. lakhs)*
1. Direct tax 15 23,113.43
2. Indirect tax 28 6,464.73
Total 43 29,578.16 * to the extent quantifiable
3. Litigation, inquiries, inspections, or investigations initiated or conducted under the Companies Act or any
198
previous company law against our Company and / or our Subsidiaries in the last three years
There are no outstanding litigation, inquiries, inspections or investigations initiated or conducted under the
Companies Act or any previous company law, against our Company and / or our Subsidiary in the last three
years immediately preceding the date of this Placement Document except the following:.
As per Section 149 of the Companies Act, 2013 and Regulation 17(1) of SEBI Listing Regulations, the Company
is required to have at least one woman Director on its Board. However, with effect from November 16, 2019,
the Board of the Company does not have any woman Director. Both BSE and NSE have imposed penalties on
the Company for non-compliance of Regulation 17(1) of SEBI Listing Regulations pertaining to appointment of
woman Director on the Board of the Company. Details of fine imposed on the Company is given below:
Name of
Exchange
Penalty
imposed for
quarter
ended
31.3.2020
Penalty
imposed for
quarter
ended
30.6.2020
Penalty
imposed for
quarter
ended
30.9.2020
Penalty
imposed for
quarter
ended
31.12.2020
Total
Penalty
imposed till
date
BSE 2,65,500/- 5,36,900/- 5,42,800/- - 13,45,200/-
NSE 2,65,500/- 5,36,900/- 5,42,800/- 5,42,800/- 18,88,000/-
4. Prosecutions filed against, fines imposed on, or compounding of offences by our Company and / or our
Subsidiary under the Companies Act in the last three years
There no prosecutions filed against, fines imposed on, or compounding of offences by our Company and/or our
Subsidiary under the Companies Act in the last three years immediately preceding the date of this Placement
Document except the following:
As per Section 149 of the Companies Act, 2013 and Regulation 17(1) of SEBI Listing Regulations, the Company
is required to have at least one woman Director on its Board. However, with effect from November 16, 2019,
the Board of the Company does not have any woman Director. Both BSE and NSE have imposed penalties on
the Company for non-compliance of Regulation 17(1) of SEBI Listing Regulations pertaining to appointment of
woman Director on the Board of the Company. Details of fine imposed on the Company is given below:
Name of
Exchange
Penalty
imposed for
quarter
ended
31.3.2020
Penalty
imposed for
quarter
ended
30.6.2020
Penalty
imposed for
quarter
ended
30.9.2020
Penalty
imposed for
quarter
ended
31.12.2020
Total
Penalty
imposed till
date
BSE 2,65,500/- 5,36,900/- 5,42,800/- - 13,45,200/-
NSE 2,65,500/- 5,36,900/- 5,42,800/- 5,42,800/- 18,88,000/-
5. Details of acts of material fraud committed against our Company in the last three years, if any, and if so,
the action taken by our Company
There has been no material fraud committed against our Company in the last three years immediately preceding
the date of this Placement Document.
6. Defaults by our Company in respect of dues payable including therein the amount involved, duration of
default and present status of repayment of statutory dues, debentures (including interest thereon), deposits
(including interest thereon) and loans (including interest thereon)
Our Company has no outstanding defaults dues payable to holders of any debentures and interest thereon,
deposits and interest thereon and loans and interest thereon from any bank or financial institution.
199
Further, as of December 31, 2020, there are no outstanding instances of defaults in repayment of statutory
dues by the Company, except the following reported disputed dues:
Name of the Statue Nature of Dues Period to which
the amount
relates
Forum where dispute
is pending
Gross
Dispute
Amount
(Rs in lakh)
Central Excise Act Central Excise 2014-15 to 2016-
17
High Court of
Jharkhand
560.60
(ICC)
Madhya Pradesh Value
Added Tax Act,
Entry Tax 1994-95 Commissioner
(Appeals) Jabbalpur
5.38
(MCP)
Madhya Pradesh Value
Added Tax Act,
State Sales Tax/
VAT
2009-2010 Sales tax Authority
(Bhopal)
34.47
(MCP)
Madhya Pradesh Value
Added Tax Act,
State Sales Tax/
VAT
2011-12 Sales tax Authority
(Bhopal)
16.66
(MCP)
Madhya Pradesh Value
Added Tax Act,
State Sales Tax/
VAT
2012-13 Sales tax Authority
(Bhopal)
99.89
(MCP)
Central Excise Act Central Excise 2010-11 TO
2013-14
CESTAT 627.60
(MCP)
Rajasthan Value Added
Tax Act,
Central Excise 2007.08 TO
2014-15
Hon'ble Supreme Court 676.40
(KCC)
Central Excise Act Central Excise 2005-06, 2013-
14, 2014-15,
2017-18 & 2018-
19
Commissioner Central
Excise, Bikaner
1,392.82
(KCC)
Central Excise Act Central Excise 2018-19 CESTAT 361.69
(KCC)
Income Tax Act Income Tax 2016-17 & 2017-
18
Commissioner of
Income Tax ,Jaipur
1.15
(KCC)
Maharashtra Value
Added Tax Act,
State Sales Tax/
VAT
1994-95,2011-
12, 2012-13 &
2013-14
Appellate Authority 777.60
(TCP)
Central Excise Act Central Excise 2010-11 CESTAT 5.26
(TCP)
Panvel Municipal
Corporation Act
Local Body Tax 01.01.2017 TO
30.06.2017
Panvel Municipal
Corporation
1,906.36
(TCP)
Income Tax Act Income Tax 2001-02 TO
2003-04, 2005-
06 TO 2007-08
High Court of Kolkata 11,508.52
(HO)
Income Tax Act Income Tax 2007-08, 2011-
12, 2012-13,
2016-17 & 2017-
18
ITAT/ Commissioner
of Income Tax (Appeal)
11,603.76
200
(HO)
TOTAL 29,578.16
7. Details of default in annual filings under the Companies Act or rules made thereunder
There has been no default by our Company in the annual filings under the Companies Act or the rules made
thereunder.
8. Details of significant and material orders passed by any Regulator, Court or Tribunal, impacting the going
concern status of our Company and/or its future operations
There has been no order passed by any regulator, court or tribunal which impacts the going concern status of
our Company and/or its future operations.
201
STATUTORY AUDITORS
The Audited Financial Statements of our Company as of and for the Fiscal ended March 31, 2020 and March 31, 2019
has been audited by our Statutory Auditor as stated in their report appearing herein and the Condensed Interim
Unaudited Financial Statements for the nine month period ended December 31, 2020 included in this Placement
Document have been subject to limited review by our Statutory Auditor as stated in their report appearing herein. The
Audited Financial Statements of our Company as of and for the Fiscal ended March 31, 2018 included in this
Placement Document, have been audited by the previous statutory auditors, J. Gupta & Co., Chartered Accountants
as stated in their report appearing herein.
202
GENERAL INFORMATION
• Our Company was incorporated as a government company under the provisions of the Companies Act, 1956 as
Hindustan Copper (Private) Limited by a certificate of incorporation dated November 9, 1967. Subsequently, our
Company became a public limited company pursuant to a shareholders’ resolution dated February 27, 1968 and
the name of our Company was changed to Hindustan Copper Limited and our Company received a fresh certificate
of incorporation on March 26, 1968. The corporate identification number of our Company is
L27201WB1967GOI028825.
• The Registered and Corporate Office of our Company is Tamra Bhavan, 1, Ashutosh Chowdhury Avenue, Kolkata
700 019, West Bengal, India.
• The authorised share capital of our Company is Rs. 11,00,00,00,000 divided into 1,80,00,00,000 Equity Shares of
face value of Rs. 5 each and 20,00,000, 7.50% non-cumulative redeemable preference shares of face value of Rs.
1000 each.
• The Issue was authorised and approved by our Board on October 29, 2020, and approved by way of a special
resolution passed by the shareholders of the Company through postal ballot dated January 28, 2021.
• Our Company has received in-principle approvals to list the Equity Shares to be issued pursuant to the Issue from
BSE and NSE on April 7, 2021, under Regulation 28(1) of the SEBI Listing Regulations.
• Except as disclosed in this Placement Document, there has been no material change in our Company’s financial
position since December 31, 2020.
• Our Audited Financial Statements as of and for the Fiscals ended March 31, 2020, March 31, 2019 and March 31,
2018 are prepared in accordance with Ind AS and the Companies Act. 2013 together with the audit reports issued
by Chaturvedi & Co., Chartered Accountants and J. Gupta & Co., Chartered Accountants for the aforesaid Fiscals
are included in this Placement Document.
• Except as disclosed in this Placement Document, there are no litigation or arbitration proceedings against or
affecting us, or our assets, business or revenues, nor are we aware of any pending or threatened litigation or
arbitration proceedings, which are or might be material in the context of this Issue. For further details, please see
section titled “Legal Proceedings” on page 195.
• Copies of the Memorandum and Articles of Association of our Company will be available for inspection between
11.00 A.M. to 5.00 P.M. on any weekday (except Saturdays, Sundays and public holidays) during the Bid/Issue
Period at our Registered and Corporate Office.
• The Floor Price for the Equity Shares under the Issue is Rs. 125.79 per Equity Share which has been calculated in
accordance with Chapter VI of the SEBI ICDR Regulations. Our Company has offered a discount of Rs. 6.19 on
the Floor Price in terms of Regulation 176 of the SEBI ICDR Regulations.
• Details of the Compliance Officer:
C.S. Singhi
Tamra Bhavan
1 Ashutosh Chowdhury Avenue
Kolkata- 700 019
Phone – 033-2283-2676
E-mail- singhi_cs@hindustancopper.com
• Our Company has obtained all consents, approvals and authorizations required in connection with the Issue.
• Our Company and the Book Running Lead Managers accept no responsibility for statements made otherwise than
in this Placement Document and anyone placing reliance on any other source of information, including our website,
would be doing it at his or her own risk.
203
• As on the date of this Placement Document, our Company has not made any default in annual filings of the
Company under the Companies Act, 2013 and the rules made thereunder.
54
INDEPENDENT AUDITOR’S REPORT
ToThe Members of Hindustan Copper Limited
Report on the Audit of the Standalone Financial Statements
OpinionWe have audited the accompanying Standalone Financial Statements of Hindustan Copper Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2020, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date, and notes to the Standalone Financial Statements including a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the Standalone Financial Statements”).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the Companies Act, 2013 (“ the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2020 and its loss (including Other Comprehensive loss), changes in equity and its cash flows for the year ended on that date.
Basis for OpinionWe conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the Standalone Financial Statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone Financial Statements.
Emphasis of MattersWe draw attention to the following matters:
a) Note No.39 (1) “Contingent liabilities” of the accompanying Standalone Financial Statements which describes the uncertainty related to the outcome of the lawsuits filed and demands raised against the Company by various parties and Government authorities;
b) Note No.39 (6) of the accompanying Standalone Financial Statements which states that the title deeds for freehold and leasehold land and building acquired in respect of Gujarat Copper Project (GCP) with book value of H5578.11 Lakh (PY:- H5859.97 Lakh) are yet to be executed in favor of the Company. Title deeds for other leasehold and freehold lands available with the Company or other evidences of title are pending to be reconciled with the financial records.
c) Note No.39 (8) of the accompanying Standalone Financial Statements wherein, balances under the head Claims Recoverable, Loans & Advances, Deposits from and with various parties and certain balances of receivables, payables and other current liabilities have not been confirmed as at March 31, 2020.Consequential impact upon receipt of such confirmation /reconciliation / adjustments of such balances, if any is not ascertainable at this stage;
d) Note No.39 (28) the accompanying Standalone Financial Statements regarding Gujarat Copper project valuing H24536.34 Lakh (PY:- H27214.50 Lakh) as at March 31, 2020 where the Company has not been able to operate profitably due to various constraint, viability assessment needs to be done to evaluate and adjust for possible impairment loss, if any.
e) Note No.39 (31) which states that Closing stock as at 31st March, 2020 has been reduced aggregately by H25710.39 Lakh due to one-time adjustment through write-off in value of closing stock arising as a result of, reconciliation of metal content in copper concentrate on inter-unit transfer and sales, assessment of metal loss in generation of granulated Dump Slag, handling losses and old & oxidized concentrate. Further low grade Lean Ore and Mill Scat not presently in use in manufacturing process, for which provision of H18331.80 Lakh has been made in the books of accounts as
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INDEPENDENT AUDITOR’S REPORT (Contd...)
at March 31, 2020 by the management. As mentioned in the referred note, the Company has modified its Standard Operating Procedure on Inventory Management to strengthen the reconciliation of inventory as an ongoing activity and identification and segregation of unused stock for better control; and
f) Note No.39 (33) which describes the uncertainties and the management assessment of possible impact of COVID-19 pandemic on its business operations, financial assets, contractual obligations and its overall liquidity position as at March 31, 2020. Management will continue to monitor in future any material changes arising on financial and operational performance of the Company due to the impact of this pandemic and necessary measure to address the situation.
Our opinion is not modified in respect of these matters.
Key Audit MattersKey audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Standalone Financial Statements of the current period. These matters were addressed in the context of our audit of the Standalone Financial Statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
Sl. No. Key Audit Matters Auditor’s Response1. Assessment of Stripping Ratio and charging
of overburden expenditure during production stage of surface mines to Mines Development Expenditure and Profit and Loss account
Referred in Note No.2 (11) and Note No.9 of the Standalone Financial Statements.
Assessment of Stripping Ratio is technically estimated initially at the beginning of the Mines and later on periodically assessed for which no standards written policy are there. Normally review done within a period of 3 to 4 years as informed to us.
In case of open cast mines, the expenditure on removal of waste and overburden, is capitalized and the same is depleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodically based on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines.
Assessment of Stripping Ratio is uniquely applied under the Mining industries which involves significant judgment to determine the ratio and that also keep on change from time to time. This ratio has been changed subsequently based on the actual output of overburden and Ore exposed during the production stage of the mines.
We have identified this area as key audit matter due to its nature as industry specific and involvement of technical assumptions and judgments in calculation of stripping ratio. Further it has a material impact on the financial statements being this year the Company has amortized H23904.06 Lakh (PY:-20074.56 Lakh) as Mine development expenditure in respect of open cast mines.
Principal Audit Procedures
Our audit approach consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows:
• We went through the current status of the mining at different mines
• We discussed with the management about the stripping procedure adopted in the industry as well practice followed by the Company
• Procedure followed by the management towards Identification of expenditures incurred in surface mines during production stage
• Understanding the computation of Stripping ratio initially made and documents made available to us.
• We have checked the stripping ratio to be charged under amortization for mine development expenditure for balance period of mines
• Discussion with the core technical team involve in this process
• Reliance is placed on the representations of the management.
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2. Modified Audit Procedures carried out in light of COVID-19 outbreak:
Due to COVID-19 pandemic, Nation-wide lockdown and travel restrictions imposed by Central / State Government / Local Authorities during the period of our audit wherever physical access was not possible, audit could not be conducted by visiting the Plants/Projects/Regional Sales offices. As we could not gather audit evidence in person/ physically/ through discussions and personal interactions with the officials at the Plants/Projects/Regional Sales offices, we have identified such modified audit procedures as a Key Audit Matter. Accordingly, our audit procedures were modified to carry out the audit remotely.
Principal Audit Procedures
Due to the outbreak of COVID-19 pandemic that caused nationwide lockdown and other travel restrictions imposed by the Central and State Governments/local administration during the period of our audit, we could not travel to the Plants/Projects/Regional Sales offices and carry out the audit processes physically at the respective Plants/Projects/Regional Sales offices. Wherever physical access was not possible, necessary records/ reports/ documents/ certificates were made available to us by the management of the respective Plants /Projects / Regional Sales offices through E-Mail and to the extent generated from the ORACLE system at Head office, Kolkata. To this extent, the audit process was carried out on the basis of such documents, reports and records made available to us on which were relied upon as audit evidence for conducting the audit and reporting for the current period.
Accordingly, we modified our audit procedures as follows:
a) Conducted verification of necessary records/ documents/Trial Balances and other relevant application software electronically through remote access/emails in respect of Plants/Projects/Regional Sales offices wherever physical access was not possible.
b) Carried out verification of scanned copies of the documents, records, certificates, deeds etc. made available to us through emails and remote access over secure network of the Company.
c) Making enquiries and gathering necessary audit evidence through telephonic communication and e-mails.
Information Other than the Standalone Financial Statements and Auditor’s Report ThereonThe Company’s Board of Directors is responsible for the other information. The other information comprises the information included in the Report of the Board of Directors, Management Discussion and Analysis Report, Report on CSR activities, Business Responsibility Report, Corporate Governance Report and other annexure to Directors Report including Shareholder’s Information, but does not include the Standalone Financial Statements and our auditor’s report thereon. The Report of the Board of Directors including annexures and other related statements forming part of the Company’s annual report is expected to be made available to us after the date of our this auditor report.
Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information when it becomes available only and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact.
INDEPENDENT AUDITOR’S REPORT (Contd...)
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INDEPENDENT AUDITOR’S REPORT (Contd...)
When we read the Report of the Board of Directors including annexures and other related statements form part of the Company’s annual report and made available to us after the date of our this auditor report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
Responsibility of Management and Those Charged with Governance for the Standalone Financial StatementsThe Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Act with respect to the preparation of these Standalone Financial Statements that give a true and fair view of the financial position, financial performance, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards specified under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the Standalone Financial Statements, the Board of Directors is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those Board of Directors is also responsible for overseeing the Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Standalone Financial StatementsOur objectives are to obtain reasonable assurance about whether the Standalone Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone Financial Statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis or our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the Standalone Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
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• Evaluate the overall presentation, structure and content of the Standalone Financial Statements, including the disclosures, and whether the Standalone Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the Standalone Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Standalone Financial Statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Standalone Financial Statements.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Standalone Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements1) As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government of India
in terms of sub section (11) of Section 143 of the Act, we give in “Annexure A”, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2) As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit except as reported in Clause (b) & (c) of the “Emphasis of Matters” paragraph above;
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books;
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account.
d) In our opinion, the aforesaid Standalone Financial Statements comply with the Ind AS specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;
e) In pursuance to the Notification No. G.S.R 463(E) dated 05-06-2015 issued by Ministry of Corporate Affairs, Section 164(2) of the Act regarding disqualification of Directors, is not applicable to the Company, since it is a Government Company;
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.
INDEPENDENT AUDITOR’S REPORT (Contd...)
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59
g) As per Notification No. GSR 463(E) dated 05-06-2015 issued by the Ministry of Corporate Affairs, Government of India, Section 197 of the Act is not applicable to the Government Companies. Accordingly, reporting in accordance with requirement of provisions of Section 197(16) of the Act is not applicable on the Company.
h) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its Standalone Financial Statements–[Refer Note No. 39(1) to the accompanying Standalone Financial Statements];
ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.
3) As required under Section 143(5) of the Act, we give in the “Annexure C”, a statement on the directions and sub-directions issued by the Comptroller and Auditor General of India in respect of the Company.
For Chaturvedi & Co. Chartered Accountants (Firm’s Registration No.302137E)
Place: Kolkata CA R.K. NandaDate: July 21, 2020 Partner (Membership No.510574)
UDIN: 20510574AAAABH1998
INDEPENDENT AUDITOR’S REPORT (Contd...)
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“Annexure A” To the Independent Auditor’s Report
{Referred to in Paragraph (1) of “Report on Other Legal and Regulatory Requirements” section of our Independent Auditor’s Report}
i. In respect of the Company’s fixed assets:
(a) The Company has maintained records showing full particulars, including quantitative details and situation of fixed assets. Further asset identification numbers and codification of some movable tangible assets along with make/model number needs to be assigned to the assets and to be updated in Fixed Asset Register. Location details and areas of freehold land and leasehold land held by the Company at different locations needs to be updated in the Fixed Asset Register and further needs to be reconciled with financial records. Quantitative details in case of few old assets along with their description, particulars of depreciation, amortization or impairment have also not been properly disclosed in the Fixed Asset Register.
(b) According to the information and explanations given to us, the fixed assets of the Company has been physically verified by the management every year so that all the assets of Units/offices are covered once in a block of three years interval, which in our opinion is reasonable having regard to the size of the Company and the nature of its business. As per the phased programme, during the year the Company had to conduct the physical verification at Malanjkhand Copper Project (MCP), Gujarat Copper Project (GCP), Indian Copper Complex (ICC) and Rakha Copper Project (RCP). However the verification procedure at ICC and RCP is not completed due to PAN INDIA lockdown for COVID 19 pandemic. The physical verification procedure is completed at MCP and GCP. According to the information and explanations given to us, no material discrepancies were noticed on such verification for adjustment/settlement in the books of account. The process of physical verification at Units/offices should be further improved by having the detailed list of assets with their identification numbers along with Group asset code, quantity and value as per Fixed Assets Register duly mapped with assets physically verified and also having a well-defined manual of physical verification especially looking into the various locations, quantum of assets physically available at each of the plant/office locations.
(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, lands (both freehold and leasehold) and Building acquired in respect of Gujarat Copper Project having book value of H5578.11 Lakh as at March 31, 2020 are yet to be executed in favor of the Company. The title deeds, conveyance deeds etc. in respect of certain freehold lands at Indian Copper Complex acquired through nationalization in accordance with Indian Copper Corporation (Acquisition of Undertaking) Act, 1972 which as per the management, are not in possession of the Company. Further to as stated above, the management has not been able to produce title deeds/lease deeds/other evidence of title for rest of the lands & buildings situated at different Plants/ Projects/offices, for which the Company has to identify each of such lands with respect to their measuring areas as per the available records and reconcile the same with the value of the leasehold and freehold lands & buildings shown under Note No.3A & 3B (for freehold lands) and Note No.9 &17 (for leasehold lands) of the accompanying Standalone Financial statements.
ii. The physical verification of Semi-Finished and In-Process (WIP) stocks and Finished Goods as per the policy is conducted departmentally in all the units (Indian Copper Complex, Khetrinagar Copper Complex, Malanjkhand Copper Project, Taloja Copper Project & Gujarat Copper Project) at the end of the every financial year by a duly approved committee and again once in a block of three years along with an Independent external agency appointed in this regard by duly approved committee.
For this year although work orders were issued to independent agencies in all the units for carrying out physical stock verification, due to PAN INDIA lockdown for COVID 19 pandemic the same could not be completed at Khetrinagar Copper Complex & Indian Copper Complex since the work orders were issued to out-station parties through tendering process. The physical verification procedure has been completed at Taloja Copper Project, Malanjkhand Copper Project and Gujarat Copper Project by the Independent agencies while at ICC and KCC, stock was verified and certified by the Unit’s management. The Unit’s management has identified the differences in respect of copper content on stock of Inter-unit transfer and differential quantity of metal loss in Granulated Dump Slag and reconciled those differences which were further audited by appointing an Independent auditor by the Company. By virtue of these exercise, closing stock as at March 31, 2020 has been reduced aggregately by H25710.39 Lakh due to one-time adjustment through write-off in value of closing stock at KCC and ICC arising as a result of, reconciliation of metal content in copper concentrate on inter-unit transfer and sales, assessment of metal loss in generation of Granulated Dump Slag, handling losses and
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“Annexure A” To the Independent Auditor’s Report (Contd...)
old & oxidized concentrate considered as dead stock. Further low grade Lean ore and Mill Scat presently not in use in manufacturing process, for which provision of H18331.81 Lakh have been made in the books of accounts as at March31, 2020 by the management. The Company has modified its Standard Operating Procedure on Inventory Management to strengthen the reconciliation of inventory process as an ongoing activity and identification and segregation of unused stock for better control. This has been further described in Note No.39 (31) of the accompanying Standalone Financial Statements.
In respect of stores and spares, physical verification has been conducted by the external agencies, located in and around the project site, in all the units during the year. Shortages/ (Excesses) identified on such physical verification which were not material as per the management, have been properly dealt with in the books of account.
iii. The Company has not granted any loans, secured or unsecured to any companies, firms, limited liability partnership or other parties, covered in the register maintained under section 189 of the Companies Act, 2013.
iv. According the information and explanations given to us, the Company has not given any loan, given any guarantee or provided any security in connection with such loan given/Investment made to which provisions of Section 185 of the Act apply. The provisions of Section 186 of the Act, in our opinion, are not applicable to the Company.
v. In our opinion and according to information and explanations given to us, the Company has not accepted any deposits as per the provisions of the Act.
vi. According the information and explanations given to us, the maintenance of cost records has been specified by the Central Government under section 148(1) of the Companies Act, 2013 in respect of mining activities of the Company. We have broadly reviewed such cost records and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.
vii. (a) According to the information and explanations given to us and on the basis of our examination of books of accounts, the Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees’ State Insurance, Income Tax, Goods and Service Tax, Customs Duty, Cess and other material statutory dues applicable to it with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues which were outstanding as at 31st March, 2020 for a period of more than six months for the date of becoming payable.
(b) According to the information and explanations given to us and as per the records of the Company, following dues of Income Tax, Sales Tax, Entry Tax, Excise Duty, Cess, local body tax and Value Added Tax were in arrears as at March 31, 2020 and have not been deposited on account of dispute:
Name of the Statue Nature of Dues
Period to which the amount relates
Forum where dispute is pending
Gross Dispute Amount (J in Lakh)
Central Excise Act Central Excise
2014-15 to 2016-17 (ICC) High court of Jharkhand
560.60
Madhya Pradesh Value added Tax Act
Entry tax 1994-95 (MCP) Commissioner (Appeals) Jabbalpur
*5.38
Madhya Pradesh Value added Tax Act
State Sales Tax/ VAT
2009-2010 (MCP) Sales tax authority (Bhopal)
*34.47
Madhya Pradesh Value added Tax Act
State Sales Tax/ VAT
2011-12 (MCP) Sales tax authority (Bhopal)
*16.66
Madhya Pradesh Value added Tax Act
State Sales Tax/ Vat
2012-13 (MCP) Sales tax authority (Bhopal)
*99.89
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62
Name of the Statue Nature of Dues
Period to which the amount relates
Forum where dispute is pending
Gross Dispute Amount (J in Lakh)
Central Excise Act Central Excise
2010-11 to 2013-14 (MCP) CESTAT *627.60
Rajasthan value added tax act
Central Excise
2007-08 to 2014-15 (KCC) Hon'ble supreme Court
*676.40
Central Excise Act Central Excise
2005-06, 2013-14, 2014-15, 2017-18 & 2018-19 (KCC)
Commissioner central excise, Bikaner
1392.82
Central Excise Act Central Excise
2018-19 (KCC) CESTAT *361.69
Income tax Act Income tax
2016-17 & 2017-18 (KCC) Commissioner of Income Tax, Jaipur
*1.15
Madhya Pradesh Value added Tax Act
State Sales Tax/ Vat
1994-95,2011-12, 2012-13 & 2013-14 (TCP)
Joint commissioner (sales tax) Maharashtra
*777.60
Central Excise Act Central Excise
2010-11(TCP) CESTAT 5.26
Panvel Municipal Corporation Act
Local body tax
01.01.2017 to 30.06.2017(TCP)
Panvel municipal corporation
1906.36
Income tax Act Income tax
2001-02 to 2003-04, 2005-06 to 2007-08(HO)
High Court of Kolkata 11508.52
Income tax Act Income tax
2007-08, 2011-12, 2012-13, 2016-17 & 2017-18(HO)
ITAT/CIT(Appeals) *11603.76
Water (prevention and control of pollution) Cess act, 1977
Water Cess
1999-20 to 2019-20 (HO) Water resources department, government of Jharkhand
1799.38
*Aggregate amount of H752.59 Lakh have been deposited against the cases and shown as “Deposit with Government authorities” under Note No.-17 “Other Current Assets”.
viii. According to the information and explanations given to us, the Company has not defaulted in repayment of dues to banks. The Company has not issued any debentures and also not borrowed any loans from financial institutions or government.
ix. According to the information and explanations given to us, the Company has not raised moneys by way of initial public offer or further public offer (including debt instruments) during the year. Based on the information available, the term loans taken by the Company have been applied for the purpose for which they were raised.
x. To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company or no material fraud on the Company by its officers or employees has been noticed or reported during the year.
xi. As per notification no. GSR 463(E) dated 5.06.2015 issued by the Ministry of Corporate Affairs, Government of India, section 197 for managerial remuneration is not applicable to the Government Company and as such, provision of paragraph 3(xi) of the said order are not applicable to the Company.
xii. In our opinion, the Company is not a Nidhi Company and as such, provisions of paragraph 3(xii) of the said order are not applicable to the Company.
“Annexure A” To the Independent Auditor’s Report (Contd...)
F-9
63
xiii. According to the information and explanations given to us and based on our examination of books of accounts, transactions with the related parties are in compliance with Section 177 and 188 of the Companies Act, 2013 where applicable and the details of such transactions have been disclosed in the Standalone Financial Statements as required by the applicable Indian Accounting Standards.
xiv. According to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly paid convertible debentures during the year.
xv. According to the information and explanations given to us and based on our examination of books of accounts, the Company has not entered into any non-cash transactions specified under Section 192 of the Act with its Directors or persons connected to them.
xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and as such, reporting under this clause is not applicable to the Company.
For Chaturvedi & Co. Chartered Accountants (Firm’s Registration No.302137E)
Place: Kolkata CA R.K. NandaDate: July 21, 2020 Partner (Membership No.510574)
UDIN: 20510574AAAABH1998
“Annexure A” To the Independent Auditor’s Report (Contd...)
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64
“Annexure B” To the Independent Auditor’s Report
{Referred to in Paragraph (2)(f) of “Report on Other Legal and Regulatory Requirements” section of our Independent Auditor’s Report}
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
We have audited the internal financial controls over financial reporting of Hindustan Copper Limited (hereinafter referred as “the Company”) as of March 31, 2020 in conjunction with our audit of the Standalone Financial Statements of the Company for the year ended on that date.
Management’s Responsibility for Internal Financial ControlsThe Board of Directors of the Company is responsible for establishing and maintaining internal financial controls 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. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to respective Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditor’s ResponsibilityOur responsibility is to express an opinion on the internal financial controls over financial reporting of the Company based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained which is sufficient and appropriate to provide a basis for our audit opinion on the internal financial controls system over financial reporting of the Company.
Meaning of Internal Financial Controls over Financial ReportingA Company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial ReportingBecause of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be
F-11
65
“Annexure B” To the Independent Auditor’s Report (Contd...)
detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OpinionIn our opinion, to the best of our information and according to the explanations given to us, the Company has, in all material respects, internal financial controls system over financial reporting and such internal financial controls over financial reporting were generally operating effectively as at March 31, 2020, 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. However in certain areas where design documentation need further improvement like Manual on Fixed Assets verification, Implementation of Centralized data base for Title deeds/lease deeds/ other evidences of titles in respect of both freehold and leasehold lands and Buildings, Fund Management including Cash and Bank and controls over issuance of Bank Guarantees shown as contingent liabilities, Comprehensive delegation of power, adequate departmental work allocation process, job rotation policy etc., Inventory Management, Receivable Management, Expenditure on CSR, Payable Management incorporating the process flow by which the transactions are initiated, authorized, processed, recorded and reported at department level at Plants/Projects as well as for financial reporting process. Modification of finance/accounts manual needs to be done incorporating the Indian Accounting Standards requirements to have effective internal controls over financial reporting. System integration to capture the transactions that relates to financial statements and events/conditions and other transactions significant to the financial statement has to be designed properly so as to fulfill the objectives of control criteria established by the Company.
Internal controls over financial reporting process as well as testing of such control activities has to be further improved considering the discrepancies noticed in physical verification of fixed assets like non availability of prescribed format of reporting, reconciliation of mismatches out of such physical verification, timely adjustment of discrepancies noticed, team structure etc. and maintenance of Fixed Asset Register to be further improved. Identification of old account balances and action taken to settle/adjust the account balances after due assessments and reconciliation of account balances has to be carried out periodically. Utilization certificate related to funds disbursed under CSR programme have not been received in proper format explaining the date wise disbursements by company, various mode of spending the amount within a project, details of agency involved with their name, amount paid etc for better control. Further various control activities in Inventory management have to be established looking into the size of the Company and nature of its business especially like non-availability of defined formats of reporting upon completion of physical verification, fixing any tolerance limit for stock adjustment, Quantification of process stock and assessment of its quality, delay identification of unused stock lying on floor and its segregation process, Improper monitoring and recording of standard and actual average metal loss during manufacturing process, handling losses during the dispatch of copper concentrate from discharge point to bedding building for storage and reconciliation of metal content in copper concentrate on inter-unit transfer and sales. The Company has modified its Standard Operating Procedure on Inventory Management to strengthen the reconciliation of differences arise in physical verification process as an ongoing activity and identification and segregation of unused stock for better control. However, our opinion is not qualified in the above respect.
For Chaturvedi & Co. Chartered Accountants (Firm’s Registration No.302137E)
Place: Kolkata CA R.K. NandaDate: July 21, 2020 Partner (Membership No.510574)
UDIN: 20510574AAAABH1998
F-12
66
“Annexure C” To the Independent Auditor’s Report
{Referred to in Paragraph (3) of “Report on Other Legal and Regulatory Requirements” section of our Independent Auditors’ Report}
Sl. No.
Details/Directions Auditors’ Reply Action Taken and Impact on Accounts and Financial statements
1. Whether the Company has system in place to process all the accounting transactions through IT System? If yes, the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with financial implications, if any, may be stated
Yes, the Company has system in place to process all the accounting transactions through IT System.
There is no impact on the accounts and financial statements.
2. Whether there is any restructuring of any existing loan or cases of wavier/write off of debts/loans/interest etc. made by a lender to the Company due to the Company’s inability to repay the loan? If yes, the financial impact may be stated.
Based on the information available to us, there is no restructuring of any existing loan or cases of wavier/write off of debts/loans/interest etc. made by a lender to the Company during FY 2019-20. However, the Company has written back aggregate amount of H2280.83 Lakh towards trade liabilities pending since long and excess provisions made in accounts during the normal course of business, as stated under Note No. 39 (11) of the Standalone Financial Statements.
Impact on the accounts and financial statements to the tune of H1453.37 Lakh has already been considered.
Amount of H827.46 Lakh towards provision against feasibility study of Concentrator Plant at MCP, has been written back and equivalent amount of Capital work in progress has also charged to revenue resulting Nil impact in the accounts.
3. Whether funds received/receivable for specific schemes from Central/State agencies were properly accounted for /utilized as per its term and conditions? List the cases of deviation.
No funds received/receivable for specific schemes from Central/State agencies during FY 2019-20.
There is no impact on the accounts and financial statements.
For Chaturvedi & Co. Chartered Accountants (Firm’s Registration No.302137E)
Place: Kolkata CA R.K. NandaDate: July 21, 2020 Partner (Membership No.510574)
UDIN: 20510574AAAABH1998
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COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION 143(6)(b) OF THE COMPANIES ACT, 2013 ON THE FINANCIAL STATEMENTS OF HINDUSTAN COPPER LIMITED FOR THE YEAR ENDED 31 MARCH 2020
`The preparation of financial statements of Hindustan Copper Limited for the year ended 31 March 2020 in accordance with the financial reporting framework prescribed under the Companies Act, 2013 (Act) is the responsibility of the management of the company. The statutory auditor appointed by the Comptroller and Auditor General of India under Section 139(5) of the Act is responsible for expressing opinion on these financial statements under Section 143 of the Act based on independent audit in accordance with the standards on auditing prescribed under section 143(10) of the Act. This is stated to have been done by them vide their Audit Report dated 21 July 2020.
I, on behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit of the financial statements of Hindustan Copper Limited for the year ended 31 March 2020 under Section 143(6)(a) of the Act. This supplementary audit has been carried out independently without access to the working papers of the statutory auditor and is limited primarily to inquiries of the statutory auditor and company personnel and a selective examination of some of the accounting records.
On the basis of my supplementary audit nothing significant has come to my knowledge which would give rise to any comment upon or supplement to statutory auditors’ report under Section 143(6)(b) of the Act.
For and on the behalf of the Comptroller & Auditor General of India
(Suparna Deb)Place : Kolkata Director General Audit (Mines)Date : 03 September 2020 Kolkata
F-14
68
Standalone Balance Sheet as at 31st March 2020
In terms of our report of even date attached. For and on behalf of the Board of Directors
For Chaturvedi & Co. C.S. Singhi Sukhen Kumar Bandyopadhyay Arun Kumar ShuklaChartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEOFRN 302137E (M No. FCS 2570) (DIN : 08173882) (DIN : 03324672)
CA R K NANDAPartner(M No. 510574)Place : KolkataDated : 21st July, 2020
PARTICULARS Note No.
As at 31st March, 2020
As at 31st March, 2019
ASSETS(1) NON-CURRENT ASSETS(a) Property, Plant and Equipment 3A & 3B 29423.55 31648.77(b) Capital Work In Progress 4 123177.57 102211.31(c) Financial Assets
(i) Investments 5 3.15 18.50 (ii) Others 6 26.36 12.47
(d) Deferred Tax Assets (Net) 7 5290.81 6831.36(e) Non-Current Tax Assets (Net) 8 689.82 620.33(f) Other Non-Current Assets 9 49269.28 53268.78(2) CURRENT ASSETS(a) Inventories 10 51982.72 64366.77(b) Financial Assets
(i) Investments 11 9.48 8.85 (ii) Trade receivables 12 8289.35 36154.83 (iii) Cash and cash equivalents 13 1134.71 658.42 (iv) Bank Balances other than above 14 452.52 424.19 (v) Others 15 2686.41 3279.93
(c) Current Tax Assets (Net) 16 1845.39 - (d) Other current assets 17 37524.43 32108.63
Total Assets 311805.55 331613.14EQUITY AND LIABILITIES
(1) Equity(a) Equity Share Capital 18 46260.90 46260.90(b) Other Equity 19 49765.59 117436.33
Liabilities(1) NON-CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 20 63617.53 57065.73 (ii) Other financial liabilities 21 843.53 843.53
(b) Provisions 22 6565.93 5471.59(2) CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 23 92749.96 49945.20 (ii) Trade Payables 24 23374.42 20229.08 (iii) Other financial liabilities 25 8582.21 7600.37
(b) Other current liabilities 26 16982.85 18880.70(c) Provisions 27 3062.63 6295.75(d) Current Tax Liabilities (Net) 28 - 1583.96
Total Equity & Liabilities 311805.55 331613.14Corporate Information 1 Significant Accounting Policies 2 General Notes on Accounts 39 The notes referred to above form an integral part of the Financial Statements.
(H in lakh)
F-15
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Standalone Statement of Profit and Loss for the year Ended 31st March 2020
In terms of our report of even date attached. For and on behalf of the Board of Directors
For Chaturvedi & Co. C.S. Singhi Sukhen Kumar Bandyopadhyay Arun Kumar ShuklaChartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEOFRN 302137E (M No. FCS 2570) (DIN : 08173882) (DIN : 03324672)
CA R K NANDAPartner(M No. 510574)Place : KolkataDated : 21st July, 2020
(H in lakh except EPS)
Particulars Note No.
For the year ended 31st March, 2020
For the year ended 31st March, 2019
INCOMEI Revenue from Operations 29 83185.25 181625.72II Other Income 30 5696.22 3665.87III Total Income (I+II) 88881.47 185291.59IV EXPENSES
Cost of Materials Consumed 31 628.24 6493.41Changes in Inventories of Finished Goods, Semi-Finished and Work-In-Process
32 (5113.58) 14336.74
Employees Benefit Expense 33 25962.31 31651.48Finance Cost 34 6041.89 5546.10Depreciation and Amortisation Expense 35 28861.08 25288.75General,Administration & Other Expenses 36 86272.96 78940.47Total Expenses (IV) 142652.90 162256.95
V PROFIT /(LOSS) BEFORE EXCEPTIONAL ITEMS AND TAX (III-IV)
(53771.43) 23034.64
VI Exceptional items - - VII PROFIT /(LOSS) BEFORE TAX (V-VI) (53771.43) 23034.64VIII TAX EXPENSE 37 1) Current Tax 842.18 9128.932) Deferred Tax 2295.83 (667.91)IX PROFIT /(LOSS) FOR THE PERIOD FROM CONTINUING
OPERATIONS AFTER TAX (VII-VIII) (56909.44) 14573.62
X Profit/(Loss) from discontinued operations (34.70) (34.70)XI Tax expense of discontinued operations (8.73) (12.13)XII PROFIT/(LOSS) FROM DISCONTINUED OPERATIONS AFTER
TAX (X -XI)(25.97) (22.57)
XIII PROFIT /(LOSS) FOR THE PERIOD AFTER TAX (IX+XII) (56935.41) 14551.05XIV OTHER COMPREHENSIVE INCOME /(LOSS) 38 A(i) Items that will not be reclassified to Profit / (Loss) (3000.95) (1676.21)A(ii) Income Tax relating to items that will not be reclassified to
Profit / (Loss) 755.28 585.74
B(i) Items that will be reclassified to Profit / (Loss) - - B(ii) Income Tax relating to items that will be reclassified to
Profit / (Loss) - -
XV TOTAL COMPREHENSIVE INCOME/ (LOSS) FOR THE PERIOD (XIII+XIV) (Comprising Profit/(Loss) and Other Comprehensive Income for the period)
(59181.08) 13460.58
XVI Earning per equity share (for continuing operations)1 BASIC (H) (6.151) 1.5752 DILUTED (H) (6.151) 1.575
XVII Earning per equity share (for discontinued operations)1 BASIC (H) (0.003) (0.002)2 DILUTED (H) (0.003) (0.002)
XVIII Earning per equity share (for discontinued & continuing operations)1 BASIC (H) (6.154) 1.5732 DILUTED (H) (6.154) 1.573
Corporate Information 1 Significant Accounting Policies 2General Notes on Accounts 39 The notes referred to above form an integral part of the Financial Statements.
F-16
70
Stat
emen
t of C
hang
es in
Equ
ity
A .
Equ
ity
Shar
e C
apit
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in la
kh)
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nce
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port
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peri
od 0
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8Ch
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s in
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hare
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260.
90 -
4626
0.90
B. O
ther
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(H in
lakh
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arti
cula
rsG
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al
Res
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pons
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65.9
721
166.
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163.
0015
5.94
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5.18
1174
36.3
3 D
ivid
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ivid
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(580
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)Pr
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or th
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ar
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- (5
6935
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)(2
245.
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(224
5.67
)Am
out a
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urin
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764.
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(268
9.59
)Am
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- -
- -
- Ba
lanc
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1.03
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65.9
721
166.
24
- 2
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0 (2
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65)
2200
4.03
4976
5.59
Stat
emen
t of C
hang
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ity
A .
Equ
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Shar
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apit
al(H
in la
kh)
Bala
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9Ch
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260.
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B. O
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Par
ticu
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G
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ty
Res
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Min
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-
- 76
313.
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Div
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ds &
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t for
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-
- -
- -
1455
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14
551.
05
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me
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163
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36.3
3
Standalone Statement of Changes in Equity for the Year Ended 31st March 2020
In te
rms
of o
ur re
port
of e
ven
date
att
ache
d.
For a
nd o
n be
half
of th
e Bo
ard
of D
irec
tors
For
Cha
turv
edi &
Co.
C. S
. Sin
ghi
Sukh
en K
umar
Ban
dyop
adhy
ay
Aru
n K
umar
Shu
kla
Char
tere
d Ac
coun
tant
s Co
mpa
ny S
ecre
tary
D
irec
tor (
Fina
nce)
& C
FO
Chai
rman
and
Man
agin
g D
irec
tor &
CEO
FRN
302
137E
(M
No.
FCS
257
0)
(DIN
: 08
1738
82)
(DIN
: 03
3246
72)
CA
R K
NA
ND
APa
rtne
r(M
No.
510
574)
Plac
e : K
olka
taD
ated
: 21
st J
uly,
202
0
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71
Standalone Cash Flow Statement for the Year Ended 31st March 2020
For the year ended31st March 2020
For the year ended31st March 2019
A. CASH FLOW FROM OPERATING ACTIVITIES :NET PROFIT/ (LOSS) BEFORE TAX AS PER STATEMENT OF PROFIT AND LOSS
(53771.43) 23034.64
Adjusted for :Depreciation 3589.34 3661.65Provisions charged 18884.59 1899.68Provisions written back (2280.83) (1095.29)Interest expense 6041.89 5546.10Amortisation 25271.73 21627.10Interest income (1021.90) (334.49)Loss / (Profit) on disposal of fixed assets 2.04 (48.24)
OPERATING PROFIT/ (LOSS) BEFORE WORKING CAPITAL CHANGES
(3284.57) 54291.15
Adjusted for :Decrease/ (Increase) in Trade & other Receivables 27921.74 (28004.35)Decrease/ (Increase) in Inventories (5682.60) 14412.96Decrease/ (Increase) in Current & Non-Current assets (3808.73) (7008.79)Increase/ (Decrease) in Current & Non-Current Liabilities (2119.57) (2836.41)
CASH GENERATED FROM OPERATIONS 13026.27 30854.56Tax Refund received - 1106.54Taxes paid (4423.72) (6730.75)
NET CASH FROM OPERATING ACTIVITIES (A) 8602.55 25230.35B. CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of Fixed Assets (22094.87) (40039.64)Sale of Fixed Assets 12.03 80.07Interest received 1015.68 415.71Advance for / (Recovery of advance) for Capital expenditure - 260.68Investment in Joint Venture / Subsidiary (3.00) (18.50)Mine Development Expenditure (21913.69) (19369.43)
NET CASH USED IN INVESTING ACTIVITIES (B) (42983.85) (58671.11)C. CASH FLOW FROM FINANCING ACTIVITIES
Non-Current borrowings / (Loan repaid) 15895.21 52669.68 Dividends paid (4811.14) (2313.05)Tax on Dividend (988.94) (475.45)Interest paid (5895.91) (5422.90)
NET CASH USED IN FINANCING ACTIVITIES (C) 4199.22 44458.28NET INCREASE IN CASH AND CASH EQUIVALENTS (A + B + C) (30182.08) 11017.52 CASH AND CASH EQUIVALENTS - opening balance (38118.57) (49136.09)CASH AND CASH EQUIVALENTS - closing balance (68300.65) (38118.57)(details in Annexure - A)
(H in lakh)
In terms of our report of even date attached. For and on behalf of the Board of Directors
For Chaturvedi & Co. C. S. Singhi Sukhen Kumar Bandyopadhyay Arun Kumar ShuklaChartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEOFRN 302137E (M No. FCS 2570) (DIN : 08173882) (DIN : 03324672)
CA R K NANDAPartner(M No. 510574)
Place : KolkataDated : 21st July, 2020
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ANNEXURE - A1. CASH AND CASH EQUIVALENTS - opening balance 01/04/2019 01/04/2018
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 658.42 879.67 ii) Current Financial Assets - Bank Balance other that above (Note 14) 408.33 379.16 (Excluding Unpaid Dividend of H15.86 Lakh) iii) Current Financial Assets - Investments (Note 11) 8.85 8.18 iv) Non-current Financial Assets - Others (Note 6) 12.47 1.44 v) Current Financial Liabilities - Borrowings (Note 23) (39206.64) (50404.54)
(38118.57) (49136.09)CASH AND CASH EQUIVALENTS - closing balance 31/03/2020 31/03/2019i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 1134.71 658.42 ii) Current Financial Assets - Bank Balance other that above (Note 14) 432.21 408.33 (Excluding Unpaid Dividend of H20.31 Lakh) iii) Current Financial Assets - Investments (Note 11) 9.48 8.85 iv) Non-current Financial Assets - Others (Note 6) 26.36 12.47 v) Current Financial Liabilities - Borrowings (Note 23) (69903.41) (39206.64)
(68300.65) (38118.57)
Standalone Cash Flow Statement for the Year Ended 31st March 2020 (Contd...)
2. The Cash Flow Statement has been prepared as set out in Indian Accounting Standard (IND AS) 7 : STATEMENT OF CASH FLOWS, as amended by Companies (Indian Accounting Standards) (Amendment) Rules 2016.
This is the Cash Flow Statement referred to in our report of even date attached.
(H in lakh)
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Notes to the Standalone Financial Statements
1. Corporate Information Hindustan Copper Limited, established in 1967 and domiciled in India is a Central public sector undertaking under
the administrative control of Ministry of Mines, Government of India. The registered office of the company is situated at Kolkata. The principal activities of the company are exploration, exploitation, mining of copper and copper ore including beneficiation of minerals, smelting and refining. The Company has copper mines & concentrator plants in Malanjkhand Copper Project at Madhya Pradesh (MCP), Khetri Copper Complex at Rajasthan (KCC) and Indian Copper Complex, Ghatsila at Jharkhand (ICC). The company is operating Smelter & Refinery in ICC and Gujarat Copper Project, Gujarat (GCP) for production of copper cathode. Further, cathode is converted into copper wire rod at Copper wire rod plant at Taloja Copper Project, Taloja, Maharashtra (TCP). The Company is listed with BSE Ltd. and National Stock Exchange of India Ltd.
2. Significant Accounting Policies 2.1 Basis of Accounting
The financial statements are prepared under historical cost convention from the books of accounts maintained under accrual basis except for certain financial instruments which are measured at fair value and in accordance with the Indian Accounting Standards prescribed under Companies Act, 2013.
2.2 Application of Indian Accounting Standards (Ind-AS) The Company adopted Indian Accounting Standards (Ind AS) from April 1,2016 and accordingly the financial
statements have been prepared in accordance with the recognition and measurement principles as notified by MCA under the Companies (Indian Accounting Standards) Rules, 2015 (“Ind AS Rules”), as amended and other relevant provisions of the Companies Act, 2013.
The Company has complied all the Ind AS as applicable and relevant to the Company.
2.3 Use of Estimates The preparation of the Company’s financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Revision to accounting estimates are recognised in the period on which the estimates are revised and, if material their effects are disclosed on the notes to the financial statements.
2.4 Current and Non-current Classification The Company presents assets and liabilities in the Balance sheet based on current/non-current classification. An
asset are treated as current by the company when:
a) its expects to realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it holds the assets primarily for the purpose of trading;
c) it expects to realize the asset within twelve months after the reporting date; or
d) the asset is cash or cash equivalent (as defined under Ind AS 7) unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
Except the above, all other assets are classified as Non-current.
A liability is treated as current by the company when:a) its expects to settle the liability realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it expects to settle the liability in its normal operating cycle;
c) it holds the liability primarily for the purpose of trading;
d) the liability is due to be settled within twelve months after the reporting period; or
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Notes to the Standalone Financial Statements (Contd...)
e) it does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
Except the above, all other liabilities are classified as non-current.
2.5 Revenue Recognition Revenue is measured at the fair value of the consideration received or receivable and fair value has been defined
taking into account contractually defined terms of payment. Operating revenue recognized is net of all promotional expenses and discounts, rebates and/or any other incentive to customers.
Sale of Products An entity shall account for a sale contract with a customer only when all of the following criteria are met:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are committed to perform their respective obligations;
(b) the entity can identify each party’s rights regarding the goods to be transferred;
(c) the entity can identify the payment terms for the goods to be transferred;
(d) the contract has commercial substance i.e the risk, ownership, timing or amount of the entity’s future cash flows etc is expected to change as a result of the contract; and
(e) it is probable that the entity will collect the consideration to which it will be entitled in exchange for the goods that will be transferred to the customer.
In case of sale of Copper Concentrate, Copper Reverts, Anode Slime etc. and tolling of Copper Concentrate of Khetri and Malanjkhand origin, sales / tolling at the end of the accounting period are recorded on provisional basis as per standard parameters for want of actual specifications and differential sales value are recorded only on receipt of actual. This is as per consistent practice followed by the company.
Sale of ServicesIncome from conversion of job work is accounted for on the basis of actual quantity dispatched. When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shall be recognized by reference to the stage of completion (Percentage of Completion Method) of the transaction at the end of the reporting period.
Advances received from the customers are reported as customer’s deposits unless the above conditions for revenue recognition are met.
Other Operating Revenuesa. Sale of Scrap
Sale of Scrap is accounted for on delivery of material.
b. Interest from Customers In case of credit sales, interest up to the date of Balance Sheet on all outstanding bills is accounted for on
accrual basis.
c. Interest from Contractors against mobilisation advance for mining operations Interest up to the date of Balance Sheet on all mobilisation advances for mining operations is accounted for on
accrual basis.
d. Penalty and Liquidated Damages
Penalty and liquidated damages are accounted for as and when these are realised by the company as per contract terms.
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Notes to the Standalone Financial Statements (Contd...)
Other Incomea. Claims Claims are recognized in the Statement of Profit & Loss (Net of any payable) including receivables from
Government towards subsidy, cash incentives, reimbursement of losses, etc, when there is certainty of realisation of such claim and that can be measured reliably.
b. Dividend and Interest from Investments Dividend income from Investments is recognised in the Statement of Profit and Loss when the right to receive
the dividend has been established and it is certain that the economic benefits will flow to the company and the amount of income can be measured reliably.
Interest Income from a financial asset is recognised using Effective Interest Method. When it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably.
c. Profit on Sale of Investment Profit on sale of investment is recognised upon transfer of title by the company and is determined as the
difference between the sales price and the then carrying value of the investment.
d. Provisions not required written back
Provisions/Liabilities created from business activities in earlier years no longer required are accounted for.
e. Others Any other income is recognised on accrual basis.
2.6 Employees Benefit Retirement benefit costs and termination benefits
Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest), is reflected immediately in the statement of financial position with a charge or credit recognized in other comprehensive income in the period in which they occur. Re-measurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to Statement of Profit or Loss. Past service cost is recognized in Statement of Profit or Loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:
i. Service cost (including current service cost, past service cost, etc.);
ii. Net interest expense or income; and
iii. Re-measurement.
The company presents the first two components of defined benefit costs in profit or loss in the line item ‘employee benefits expense’.
The retirement benefit obligation recognized in the statement of financial position represents the actual deficit or surplus in the company defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.
A liability for a termination benefit is recognized at the earlier of when the company can no longer withdraw the offer of the termination benefit and when the company recognises any related restructuring costs.
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Short-term and other long-term employee benefits A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick
leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.
Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the company in respect of services provided by employees up to the reporting date.
Deficit in Provident Fund Deficit, if any, in the accounts of Provident Fund Trust ascertained on the basis of last audited accounts of the Trust
is accounted for as a charge to Revenue.
2.7 Borrowing Cost Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily
takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest expenses calculated using the effective interest method and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs
2.8 Taxation Income tax expense represents the sum of current tax and deferred tax.
Current tax The current tax payable is based on taxable profit for the year as determined from net profit before tax as represented
in Statement of Profit and Loss and Other Comprehensive Income, in line with different provisions under Income Tax Act 1961.Current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in
the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
Current and Deferred Tax for the year Current and deferred tax are recognized in Statement of Profit or Loss, except when they relate to items that are
recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity respectively.
Notes to the Standalone Financial Statements (Contd...)
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2.9(a) Property Plant and Equipments (PPE) The cost of an item of PPE is recognized as an asset if and only if, it is probable that future economic benefits
associated with the item will flow to the company and the cost of the item can be measured reliably. The cost of an item of PPE is the cash price equivalent at the recognition date. The cost of an item of PPE comprises:
i. Purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates.
ii. Costs directly attributable to bringing the PPE to the location and condition necessary for it to be capable of operating in the manner intended by management.
iii. The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which the company incurs either when the PPE is acquired or as a consequence of having used the PPE during a particular period for purposes other than to produce inventories during that period.
The company has chosen the cost model of recognition and this model is applied to an entire class of PPE. After recognition as an asset, an item of PPE is carried at its cost less any accumulated depreciation and any accumulated impairment losses.
Pending reconciliation/receipt of the final bills against capital items, capitalization is done on the basis of cost booked and depreciation is charged accordingly. Price differences, if any, are adjusted in the year of finalization of bills.
In respect of expenditure during construction/development of a new unit/project in a new location, all direct capital expenditure as well as all indirect expenditure incidentals to construction are capitalized allocating to various items of PPE on an appropriate basis. Expansion programme involving construction concurrently run with normal production activities in an existing unit, all direct capital expenditure in relation to such expansion are capitalized but indirect expenditure are charged to revenue. Borrowing costs that are attributable to the acquisition or construction of qualifying asset are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.
Expenses incurred for implementation of new projects are carried forward against respective projects till execution. Expenses rendered in fructuous projects abandoned subsequently are provided for in the Statement of Profit & Loss.
Physical verification of PPE is conducted every year so that all the units/offices are covered once in a block of three years interval. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification.
Depreciation and Amortization The company has used the exemption available in Ind AS 101 with respect to recognition of Plant, Property and
Equipment (PPE) and Intangible Assets at their carrying value being deemed cost.
The depreciable amount of an item of PPE is allocated on a straight line basis over its useful life prescribed in Part C of Schedule II of the Companies Act,2013 or actual useful life of assets assessed by the Technical Committee of the company, whichever is lower. The residual value and the useful life of an asset are reviewed, at each financial year-end. Each part of an item of PPE with a cost that is significant in relation to the total cost of the item is depreciated separately. Depreciation on all such items have been provided from the date they are ‘Put to Use’ till the date of sale and includes amortization of intangible assets and lease hold assets. Freehold land is not depreciated. The residual value of all such items is taken at 5% of the original cost of individual asset.
An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Certain consumable items of small value whose useful life is very limited are directly charged to revenue in the year of purchase.
From the date Ind AS came into effect, the carrying amount of an asset is depreciated over the remaining useful life of the asset as per estimate of remaining useful life. Wherever, the remaining useful life of an asset is nil, the carrying amount is recognized in the opening balance of retained earnings after retaining the residual value.
Notes to the Standalone Financial Statements (Contd...)
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2.9(b) Intangible Assets Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets
acquired in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation (calculated on a straight-line basis over their useful lives) and accumulated impairment losses, if any.
Internally generated intangibles, excluding capitalised development costs, are not capitalised. Instead, the related expenditure is recognised in the statement of profit and loss and other comprehensive income in the period in which the expenditure is incurred. An internally generated intangible asset arising from development is recognized if all the conditions stipulated in “Ind AS 38-Intangible Asset” are met. The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.
An intangible asset with an indefinite useful life is not amortised but is tested for impairment at each reporting date and its useful life is reviewed in each reporting period to determine whether events and circumstances continue to support an indefinite useful life estimate.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss.
Intangible Assets other than Software are amortized over estimated useful life which is equivalent to license period, generally not more than 5 years.
Cost of Software recognized as intangible asset, is amortised on straight line method over a period of legal right to use with a nil residual value. Otherwise the cost of software will be charged in the year of incurrence.
2.10 Capital Work in Progress Assets in the course of construction are included under capital work –in-progress and are carried at cost, less
any recognized impairment loss. Such capital work-in-progress, on completion, is transferred to the appropriate category of property, plant and equipment.
2.11 Mine Development Expenditure In case of underground mines : The expenditure on development of a new mine in all cases and on subsequent
development of a working mine is capitalized and depleted on the basis of ore raised during the year and the mineable ore reserves estimated from time to time.
In case of working mines, where development activities are going on simultaneously: Expenses are apportioned between capital and revenue on the basis of in-house technical estimates.
In respect of open cast mines : The expenditure on removal of waste and overburden, is capitalized and the same is depleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodically based on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines. Subsequently, If any ore is reclaimed from overburden, the same is included in inventory at a value based on opening rate of mine development expenditure with a corresponding credit in Mine development expenditure.
Expenditure incurred on development of new deposits are capital in nature and is included in mine development expenditure. If subsequently the development activities are found to be not viable, the expenditure on such development work included in mine development expenditure is written off in the year in which it is decided to abandon the project.
If a working mine is closed due to economic reasons, the un-depleted value of Mine Development Expenditure related to that mine is provided in the books of accounts in the year in which it is decided to close or suspend operation of the mine. If later on, the closed / suspended mines are re-opened and the company remains the owner of the mines, the unamortized Mine Development Expenditure which was fully provided in the year of closure will be written back in the books of accounts in the year of re-opening and the company will be depleting it year wise based on the estimated remaining life of that mine.
Notes to the Standalone Financial Statements (Contd...)
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2.12 Overhauling Expenses Revenue expenditure attributable to overhaul of smelter and/ or refinery is charged off to the Statement of Profit &
Loss in the year of incurrence.
2.13 Mine Closure Expenditure Financial implications towards final mine closure plans under relevant Acts and Rules are technically estimated
and Mine Closure Reserve is created based on the estimated life of the mines over the period by charging the same to Statement of Profit and Loss.
2.14 Non-Current Assets Held for Sale The company classifies a non-current asset (or disposal group of assets) as held for sale if its carrying amount
will be recovered principally through a sale transaction rather than through continuing use. Immediately before the initial classification of the asset (or disposal group) as held for sale, the carrying amounts of the asset (or all the assets and liabilities in the group) are to be measured in accordance with applicable Indian Accounting Standards. The sale should be expected to qualify for recognition as a completed sale within one year from the date of classification except as permitted by Ind AS 105.
2.15 Inventories Stocks of stores and spare parts, loose tools and materials-in-transit are valued at the lower of the net realizable
value and cost. The raw materials are also valued at the lower of the net realizable value and weighted average cost to the unit if the finished goods in which they will be incorporated are expected to be sold below cost. Loose tools when issued are charged off to revenue.
Finished goods and work-in-process are valued at the lower of the net realizable value and weighted average cost to the unit. The cost is exclusive of financing cost, such as, interest, bank charges, administration overhead, etc. Ore is valued at cost since its realisable value cannot be ascertained.
The value of slag under work-in-process is taken at equivalent value to the extent credited to the process, where the said products have been generated. The reverts under work- in-process are valued at lower of cost (equivalent value of concentrate) and net realizable value.
The stock of anode slime arising from treatment and refining processes are stated at realizable value based on the year end London Metal Exchange price for gold and silver after making due adjustments of their physical recovery and the treatment and refining charges.
The inventories out of inter-unit transfers (material in transit) at the close of the year are valued and accounted in the books of the transferor unit on the basis of cost plus transportation to the transferee unit or net realisable value whichever is lower.
Imported materials are valued at the lower of the net realizable value and weighted average cost. In the event where final price is not determined valuation is made on provisional cost. Variations are accounted for in the year of finalization.
Provision is made in the accounts every year, for non-moving stores and spares (other than insurance spares) which have not moved for more than five years. Insurance spares are fully provided for on the expiry of the life of the relevant Property Plant and Equipments.
Physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all the units at reasonable intervals during the year by a duly approved committee. Also, physical stock verification of WIP and Finished Goods is undertaken by a duly approved committee at the end of every financial year alongwith an independent agency once in a block of three years. In respect of Stores and Spares, physical verification is carried out by external agencies once in every year covering all the units. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification
Notes to the Standalone Financial Statements (Contd...)
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2.16 Government Grants All government grants are recognized as deferred income and it will be taken to Statement of Profit and Loss over
the period of time in accordance with the pattern in which the obligations are met.
2.17 Impairment of Assets (Other than Financial Assets) The Company assesses at the end of each reporting period whether there is any indication that an asset may
be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in Statement of Profit and Loss, unless the relevant asset is carried at a revalue amount, in which case the impairment loss is treated as a revaluation decrease.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
2.18 Foreign Exchange Transactions Transactions in currencies other than the company’s functional currency (foreign currencies) are recognized at the
rates of exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are re-translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Foreign currency monetary items (except overdue recoverable where realizability is uncertain) are converted using the closing rate as defined in the Ind AS-21- The effects of changes in Foreign Exchange Rates. Non-monetary items are reported using the exchange rate at the date of the transaction. The exchange difference gain/loss is recognized in the Statement of Profit and Loss.
In case of long term foreign currency monetary items outstanding as of 31st March 2016,liability in foreign currency loans relating to acquisition of fixed assets is converted using the closing rate as defined in Ind AS 21-The effects of changes in Foreign Exchange Rates and the difference in exchange is recognized in terms of exemptions given in paragraph D13AA of Appendix D to Ind AS-101, where the effect of exchange differences on foreign currency loans of the company is accounted for by addition or deduction to the cost of the assets so far it relates to the depreciable capital assets and shall be depreciated over the balance life of the assets.
Other long term foreign currency monetary items are accumulated in ‘Equity Component of Foreign Currency asset/liability Account’ and amortized over the balance period of the asset/liability by recognition as income or expense in each of such periods as stated under Para 29A of Ind As 21.
Notes to the Standalone Financial Statements (Contd...)
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2.19 Provisions, Contingent Liabilities & Contingent Assets Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past
event and it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
Wherever no reliable estimate could be made, a disclosure is made as contingent liability. A disclosure for a contingent liability is also made when there is a possible obligation or a present obligation that may but probably will not require an outflow of resources.
When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.
Contingent Liabilities are disclosed in the General Notes forming part of the accounts.
Contingent Assets are not recognised in the financial statements but are disclosed in Notes to the Accounts. Such assets occur when the inflow of economic benefits is probable. Such contingent assets are assessed continuously, if it’s virtually certain that inflow of economic benefits will arise then such assets and the relative income will be recognised in the financial statements.
2.20 Leasing Assets held under lease, in which a significant portion of the risks and rewards of ownership are transferred to
lessee are classified as finance leases. All other leases are classified as operating leases.
Depreciation expenses are recorded if asset held under finance lease is depreciable.
Finance expenses are recognized immediately in the statement of profit and loss if they are not directly attributable to qualifying assets, otherwise they are capitalised in accordance with the company’s general policy on borrowing costs.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term.
2.21 Financial Instruments Non Derivative Financial Instruments
(i) Initial RecognitionFinancial assets and financial liabilities are recognized when the company becomes a party to the contractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.
(ii) Subsequent Recognitiona. Financial assets Financial assets are subsequently measured at amortised cost, fair value through other comprehensive
income or fair value through profit or loss.
b. Financial Liabilities Financial liabilities are subsequently measured at amortized cost using Effective Interest Rate (EIR)
method except for derivatives, which are measured at fair value.
Notes to the Standalone Financial Statements (Contd...)
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Derivative Financial Instruments All derivatives are recognized and measured at fair value with changes in fair value being recognized in profit or
loss for the period.
Impairment of financial assets At each reporting date, assessment is made whether the credit risk on a financial instrument has increased
significantly or not since initial recognition.
If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance is measured for that financial instrument at an amount equal to 12 month expected credit losses. If the credit risk on that financial instrument has increased significantly since initial recognition, the loss allowance is measured for a financial instrument at an amount equal to the lifetime expected credit losses.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date is recognised as an impairment gain or loss in the statement of profit and loss.
2.22 Events Occurring after the Reporting Period The company adjusts the amount recognized in its financial statements to reflect adjusting material events after
the reporting period and does not adjust the amount to reflect non-adjusting events after the reporting period. However where retrospective restatement is not practicable for a particular prior period then the circumstances that lead to the existence of that condition and the description of how and from where the error is corrected are disclosed in Notes on Accounts.
2.23 Dividends Final dividend on shares are recorded as a liability on the date of approval by the shareholders in general meeting
and interim dividends are recorded as a liability on the date of declaration by the directors in the meeting of the Board of Directors.
2.24 Cash and Cash Equivalents Cash and cash equivalent in the Balance Sheet comprise cash at bank and on hand and short term deposit with an
original maturity of three months or less which are subject to insignificant risk of changes in value.
2.25 Rounding of amounts Amounts in these financial statements have, unless otherwise indicated, have been rounded off to ‘Rupees in lakh’
upto two decimal points.
Notes to the Standalone Financial Statements (Contd...)
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Shaf
ts
and
Incl
ines
Tot
al
Gro
ss C
arry
ing
Am
ount
Gro
ss C
arry
ing
Amou
nt a
s at
01.
04.2
018
2446
.58
6748
.32
2419
0.42
46
1.30
18
9.40
18
26.3
8 29
3.87
26
75.5
7 44
4.81
39
276.
65
Addi
tions
- 28
5.97
26
67.6
6 45
.22
- -
- 88
.85
- 30
87.7
0 In
ter-
head
Tra
nsfe
r In
/(Out
) -
(301
.00)
337
.90
(155
.00)
- -
- 1
18.1
0 -
0.0
0 Tr
ansf
er F
rom
Dis
card
ed A
sset
s -
- 0.
60
- 0
.20
- -
- -
0.80
Tr
ansf
er T
o D
isca
rded
Ass
ets
- (0
.46)
(103
9.16
) (3
3.30
)(1
9.26
) -
- (4
.11)
(0.6
0)(1
096.
89)
Dis
posa
ls -
- (2
9.34
) (0
.21)
(2.1
1) -
- (0
.17)
- (3
1.83
)Im
pair
men
t Los
ses
Prov
. Trf
to D
isca
rded
Ass
ets
- -
464.
01
- -
- -
- -
464.
01
Adju
stm
ents
- (3
.98)
(4.0
3)(0
.14)
0.01
0.
01
(0.0
1)(0
.02)
- (8
.16)
Gro
ss C
arry
ing
Am
ount
as
at 3
1.03
.201
924
46.5
8 67
28.8
5 26
588.
06
317.
87
168.
24
1826
.39
293.
86
2878
.22
444.
21
4169
2.28
A
ccum
ulat
ed D
epre
ciat
ion
& I
mpa
irm
ent
Accu
mul
ated
Dep
reci
atio
n as
at 0
1.04
.201
8 -
908.
82
3787
.36
155.
81
33.2
8 65
3.49
65
.34
444.
83
27.9
8 60
76.9
1 D
epre
ciat
ion
char
ge d
urin
g th
e ye
ar -
526.
38
2749
.59
59.3
0 30
.62
333.
90
32.6
7 22
0.15
13
.99
3966
.60
Inte
r-he
ad T
rans
fer I
n /(O
ut)
- 6
07.5
0 (6
10.7
9) (1
10.3
0) -
- -
113
.59
- 0
.00
Tran
sfer
Fro
m D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
Tran
sfer
To
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- Im
pair
men
t Los
ses
- -
- -
- -
- -
- -
Dis
posa
ls -
- -
- -
- -
- -
- A
ccum
ulat
ed D
epre
ciat
on &
Im
pair
men
t as
at
31.0
3.20
19 -
2042
.70
5926
.16
104
.81
63.
90
987
.39
98.
01
778
.57
41.
97
1004
3.51
Net
Car
ryin
g A
mou
nt a
s at
31.
03.2
019
2446
.58
4686
.15
2066
1.90
21
3.06
10
4.34
83
9.00
19
5.85
20
99.6
5 40
2.24
31
648.
77
Gro
ss C
arry
ing
Am
ount
Gro
ss C
arry
ing
Amou
nt a
s at
01.
04.2
019
2446
.58
6728
.85
2658
8.06
31
7.87
16
8.24
18
26.3
9 29
3.86
28
78.2
2 44
4.21
41
692.
28
Addi
tions
- 1
4.47
1
,626
.18
84.
29
57.
73
- -
41.
52
- 1
,824
.19
Inte
r-he
ad T
rans
fer I
n /(O
ut)
- -
- -
- -
- -
- -
Tran
sfer
Fro
m D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
Tran
sfer
To
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- D
ispo
sals
- -
(13.
59)
(0.0
1) (0
.45)
- -
(0.0
2) -
(14.
07)
Impa
irm
ent L
osse
s Pr
ov. T
rf to
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- Ad
just
men
ts -
- 0
.58
(0.0
1) -
0.0
1 -
(0.0
1) -
0.5
7 G
ross
Car
ryin
g A
mou
nt a
s at
31.
03.2
020
2446
.58
6743
.32
2820
1.23
40
2.14
22
5.52
18
26.4
0 29
3.86
29
19.7
1 44
4.21
43
502.
97
Acc
umul
ated
Dep
reci
atio
n &
Im
pair
men
tAc
cum
ulat
ed D
epre
ciat
ion
as a
t 01.
04.2
019
- 20
42.7
0 59
26.1
6 10
4.81
63
.90
987.
39
98.0
1 77
8.57
41
.97
1004
3.51
D
epre
ciat
ion
char
ge d
urin
g th
e ye
ar -
522.
27
2846
.05
43.3
7 2
9.44
3
25.1
7 3
2.67
2
22.9
5 1
3.99
40
35.9
1 In
ter-
head
Tra
nsfe
r In
/(Out
) -
- -
0.00
-
- -
- -
- Tr
ansf
er F
rom
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- Tr
ansf
er T
o D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
Impa
irm
ent L
osse
s -
- -
- -
- -
- -
- D
ispo
sals
- -
- -
- -
- -
- -
Acc
umul
ated
Dep
reci
aton
& I
mpa
irm
ent a
s at
31
.03.
2020
- 25
64.9
7 87
72.2
1 14
8.18
93
.34
1312
.56
130.
68
1001
.52
55.9
6 14
079.
42
Net
Car
ryin
g A
mou
nt a
s at
31.
03.2
020
2446
.58
4178
.35
1942
9.02
25
3.96
13
2.18
51
3.84
16
3.18
19
18.1
9 38
8.25
29
423.
55
Not
e : H
CL h
as u
sed
the
exem
ptio
n av
aila
ble
in In
d AS
101
with
res
pect
to r
ecog
nitio
n of
Pro
pert
y, P
lant
, Equ
ipm
ents
(PPE
) and
Inta
ngib
le A
sset
s at
thei
r car
ryin
g va
lue.
Notes to the Standalone Financial Statements (Contd...)
F-30
84
Not
e : 3
(B) P
rope
rty,
Plan
t and
Equ
ipm
ent (
Dis
card
ed A
sset
s)(H
in la
kh)
DES
CRIP
TIO
NFr
ee H
old
& L
ease
H
old
Land
Build
ings
in
clud
ing
Sani
tary
an
d W
ater
Sup
ply
Syst
em
Plan
t, M
achi
nery
an
d M
inin
g Eq
uipm
ent
Furn
iture
&
Fix
ture
s &
Offi
ce
Equi
pmen
t
Vehi
cles
Road
s,
Brid
ges
and
Culv
erts
Rai
lway
Si
ding
Ele
ctri
cal
Equ
ipm
ent
and
Inst
alla
tion
Shaf
ts
and
Incl
ines
Tota
l
Gro
ss C
arry
ing
Am
ount
Gro
ss C
arry
ing
Amou
nt a
s at
01.
04.2
018
3.64
18
1.45
37
2.93
6.
26
4.03
24
.93
- 58
.17
91.7
0 7
43.1
1 Ad
ditio
ns -
- -
- -
- -
- -
- In
ter-
head
Tra
nsfe
r In
/(Out
) -
- -
- -
- -
- -
- Tr
ansf
er F
rom
Act
ive
Asse
ts -
0.4
6 1
,039
.16
33.
30
19.
26
- -
4.1
1 0
.60
1,0
96.8
9 Tr
ansf
er T
o Ac
tive
Asse
ts -
- (0
.60)
- (0
.20)
- -
- -
(0.8
0)D
ispo
sals
- -
(0.6
4) -
- -
- -
- (0
.64)
Impa
irm
ent L
osse
s -
- (4
64.0
1) -
- -
- -
- (4
64.0
1)Ad
just
men
ts -
- -
- -
- -
- -
- G
ross
Car
ryin
g A
mou
nt a
s at
31.
03.2
019
3.64
18
1.91
94
6.84
39
.56
23.0
9 24
.93
0.00
62
.28
92.3
0 13
74.5
5 A
ccum
ulat
ed D
epre
ciat
ion
as a
t 01.
04.2
018
- -
- -
- -
- -
- -
Dep
reci
atio
n ch
arge
dur
ing
the
year
- -
- -
- -
- -
- -
Inte
r-he
ad T
rans
fer I
n /(O
ut)
- -
- -
- -
- -
- -
Tran
sfer
Fro
m D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
Tran
sfer
To
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- Im
pair
men
t Los
ses
- -
- -
- -
- -
- -
Dis
posa
ls -
- -
- -
- -
- -
- A
ccum
ulat
ed D
epre
ciat
on &
Im
pair
men
t as
at
31.0
3.20
19 -
- -
- -
- -
- -
-
Net
Car
ryin
g A
mou
nt a
s at
31.
03.2
019
3.64
18
1.91
94
6.84
39
.56
23.0
9 24
.93
- 62
.28
92.3
0 13
74.5
5 Le
ss P
rovi
sion
s fo
r Dis
card
ed A
sset
s13
74.5
5 N
et C
arry
ing
Am
ount
(Net
of P
rovi
sion
s) a
s at
31
.03.
2019
-
Gro
ss C
arry
ing
Amou
ntG
ross
Car
ryin
g Am
ount
as
at 0
1.04
.201
93.
64
181.
91
946.
84
39.5
6 23
.09
24.9
3 -
62.2
8 92
.30
1374
.55
Addi
tions
- -
- -
- -
- -
- -
Inte
r-he
ad T
rans
fer I
n /(O
ut)
- -
- -
- -
- -
- -
Tran
sfer
Fro
m A
ctiv
e As
sets
- -
- -
- -
- -
- -
Tran
sfer
To
Activ
e As
sets
- -
- -
- -
- -
- -
Dis
posa
ls -
- -
- -
- -
- -
- Im
pair
men
t Los
ses
- -
- -
- -
- -
- -
Adju
stm
ents
- -
- -
- -
- -
- -
Gro
ss C
arry
ing
Am
ount
as
at 3
1.03
.202
03.
64
181.
91
946.
84
39.5
6 23
.09
24.9
3 0.
00
62.2
8 92
.30
1374
.55
Accu
mul
ated
Dep
reci
atio
n &
Impa
irm
ent
Accu
mul
ated
Dep
reci
atio
n as
at 0
1.04
.201
9 -
- -
- -
- -
- -
- D
epre
ciat
ion
char
ge d
urin
g th
e ye
ar -
- -
- -
- -
- -
- In
ter-
head
Tra
nsfe
r In
/(Out
) -
- -
- -
- -
- -
- Tr
ansf
er F
rom
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- Tr
ansf
er T
o D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
Impa
irm
ent L
osse
s -
- -
- -
- -
- -
- D
ispo
sals
- -
- -
- -
- -
- -
Acc
umul
ated
Dep
reci
aton
& I
mpa
irm
ent a
s at
31
.03.
2020
- -
- -
- -
- -
- -
Net
Car
ryin
g A
mou
nt a
s at
31.
03.2
020
3.64
18
1.91
94
6.84
39
.56
23.0
9 24
.93
0.00
62
.28
92.3
0 13
74.5
5 Le
ss P
rovi
sion
s fo
r Dis
card
ed A
sset
s13
74.5
5 N
et C
arry
ing
Am
ount
(Net
of P
rovi
sion
s) a
s at
31
.03.
2020
-
Not
e : H
CL h
as u
sed
the
exem
ptio
n av
aila
ble
in In
d AS
101
with
res
pect
to r
ecog
nitio
n of
Pro
pert
y, P
lant
, Equ
ipm
ents
(PPE
) and
Inta
ngib
le A
sset
s at
thei
r car
ryin
g va
lue.
Notes to the Standalone Financial Statements (Contd...)
F-31
85
Note No. 4 : CAPITAL WORK IN PROGRESS
i) Building 163.27 24.22ii) Plant & Machinery 34389.11 33836.57iii) Others including Mine Expansion 92018.10 72439.01
126570.48 106299.80Less: Provision 3392.91 4088.49Total 123177.57 102211.31
Note No. 5 : NON - CURRENT FINANCIAL ASSETS - INVESTMENTS
i) Investments in equity instruments - (classified as at cost)Investment in Subsidiary Company - Chhattisgarh Copper Limited (CCL)
18.50 18.50
Less : Provision for share of Loss of Investment in Subsidiary 18.35 - Total 0.15 18.50(Investment in CCL 185,000 Nos. (Previous Year 185,000Nos.) of equity shares of H10 (Previous Year H10) each fully paid up as at 31.03.2020)
Notes to the Standalone Financial Statements (Contd...)
Details of SubsidiaryPrincipal Activity and place of incoporation
Principal place of business
Proportion of ownership interest / voting rights held by the Company as on 31.03.2020
Exploration & Mining and benefication of copper & its associated minerals
Chhattisgarh 74%
Details of JVCPrincipal Activity and place of incoporation Principal place of
business Proportion of ownership
interest / voting rights held by the Company as on 31.03.2020
To identify, explore, acquire, develop, process primarily strategic minerals overseas for supply to India for meeting domestic requirements and for sale to any other countries for commercial use.
New Delhi 30%
ii) Investments in equity instruments - (classified as at cost)A Joint Venture Company (JVC) named Khanij Bidesh India Limited (KABIL) was formed on 01.08.2019 among National Almunium Company (NALCO), Hindustan Copper Limited (HCL) and Mineral Exploration Corporation Limited (MECL) Investment in JV Company - Khanij Bidesh India Limited (KABIL) 3.00(Investment in KABIL 30,000 Nos. (Previous Year Nil) of equity shares of H10 (Previous Year H Nil) each fully paid up as at 31.03.2020)
iii. Non Trade Investment in Debentures 0.17 0.17Less : Provision for diminution in value 0.17 0.17TOTAL 3.15 18.50 AGGREGATE BOOK VALUE - UNQUOTED 3.15 18.50AGGREGATE BOOK VALUE - QUOTED Nil Nil MARKET PRICE OF QUOTED INVESTMENT - -
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-32
86
Note No. 6 : NON - CURRENT FINANCIAL ASSETS - OTHERS
Bank deposits with more than 12 months maturity- With scheduled banks 26.36 12.47Total 26.36 12.47
Note No. 8 : NON-CURRENT TAX ASSETS (NET)
Income Tax (including advance income tax, TDS & excluding current tax liability) Unsecured - Considered good
689.82 620.33
Total 689.82 620.33
Note No. 7 : DEFERRED TAX ASSETS (NET)
i) DEFERRED TAX ASSETOPENING BALANCE 9243.90 8780.81Adjustment/Credit during the year (3379.68) 463.09 CLOSING BALANCE 5864.22 9243.90
ii) DEFERRED TAX LIABILITYOPENING BALANCE (2998.28) (3203.10)Adjustment/Credit during the year 1083.85 204.82 CLOSING BALANCE (1914.43) (2998.28)
i)-ii) DEFERRED TAX ASSETS / (LIABILITIES) (Net) 3949.79 6245.62
iii) DEFINED BENEFIT PLANS OPENING BALANCE 585.74 -Adjustment/Credit during the year 755.28 585.74CLOSING BALANCE 1341.02 585.74
DEFERRED TAX ASSETS / (LIABILITIES) (Net) including OCI 5290.81 6831.36(Refer Note No. 39 General Notes on Accounts Point No. 18)
Notes to the Standalone Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-33
87
Note No. 9 : OTHER NON - CURRENT ASSETS
a) MOBILISATION ADVANCESi) Secured (considered good) 1632.12 2178.89ii) Unsecured (considered good)
– Against Bank Guarantee - - – Others - -
iii) Unsecured (considered doubtful) 0.02 0.02Less: Provisions for Capital Advances * 0.02 - 0.02 -
b) Other Loans & AdvancesReceivable from MPSEB - 828.53
c) Mine Development ExpenditureAs per Last Balance Sheet 51115.82 53068.54Add: Expenditure during the Year (as per Note Below) 22505.21 19898.22
73621.03 72966.76Less: Value of Ore recovered during Mine Development 144.95 223.84Less: Amortisation during the Year 25271.73 25416.68 21627.10 21850.94
48204.35 51115.82Less: Provision 4664.86 4664.86TOTAL 43539.49 46450.96Note: MINE DEVELOPMENT EXPENDITURE DURING THE YEAR
i) Salaries, Wages, Allowances 2655.31 2182.50ii) Contribution to Provident & Other Funds 211.43 170.84iii) Workmen & Staff Welfare Expenses 9.68 9.03iv) Stores, Spares & Tools Consumed 1963.75 2369.33v) Power, Fuel & Water 655.21 475.32vi) Royalty 11.03 16.10vii) Repair & Maitenance 4352.83 4222.59viii) Insurance 1.17 1.76ix) Overburden Removal Expenditure 11275.24 9711.09x) Depreciation 446.57 304.95xi) Other Expenses 922.99 434.71
TOTAL 22505.21 19898.22The above expenditure is in addition to the expenses shown under the respective natural head of accounts indicated and charged in the Statement of Profit and Loss Account for the year and in the relevant schedules thereof.Amortisation during the year is in relation to the expenses incurred on mines which are under operation/production and does not include expenditure on prospecting of minerals in new mines area.
Notes to the Standalone Financial Statements (Contd...)
d) Right to UseRent for Leasehold Land 4097.67 3810.40Total 4097.67 3810.40Total (a+b+c+d) 49269.28 53268.78PROVISIONS FOR CAPITAL ADVANCES *OPENING BALANCE 0.02 0.02Additions during the year - - Amount used during the year - - Closing Balance 0.02 0.02
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-34
88
Note No. 10 : INVENTORIES
i) Raw Materials - - ii) Semi-Finished and In-Process
(at lower of cost or net realisable value)64456.03 58249.42
Less: Provision for Semi-Finished and In-Process* 18454.83 46001.20 123.03 58126.39iii) Finished Goods (at lower of cost or net realisable value) 83.00 1176.03iv) Stores and spares 7646.10 7371.35
Stores in transit/ pending inspection 603.30 309.038249.40 7680.38
Less: Provision for Obsolete Stores & Spares** 2350.88 5898.52 2616.03 5064.35TOTAL 51982.72 64366.77PROVISION FOR SEMI-FINISHED AND IN-PROCESS*OPENING BALANCE 123.03 123.03Additions during the year 18331.80 - Amount used during the year - - CLOSING BALANCE 18454.83 123.03PROVISION FOR OBSOLETE STORES & SPARES**OPENING BALANCE 2616.03 2534.25Additions during the year 1.40 106.81Amount used during the year 266.55 25.03CLOSING BALANCE 2350.88 2616.03
(Refer Note No. 39 General Notes on Accounts Point No. 23)
Note No. 11 : CURRENT FINANCIAL ASSETS - INVESTMENTS
Investments in Mutual Fund (Maturity within 3 months from date of original investments)
Number of units
NAV (in H)
UTI MONEY MARKET - GROWTH 51.736 2267.76 1.17 1.09(51.736) (2112.55)
SBI ULTRA SHORT TERM DEBT FUND - GROWTH
132.117 4479.65 5.92 5.51
(132.117) (4169.40)CANARA REBECO LIQUID FUND - GROWTH 38.993 2389.98 0.93 0.88
(38.993) (2258.68)IDBI LIQUID FUND - GROWTH 68.469 2130.97 1.46 1.37
(68.469) (2002.99)TOTAL 9.48 8.85
AGGREGATE BOOK VALUE - UNQUOTED Nil NilAGGREGATE BOOK VALUE - QUOTED 7.84 7.84MARKET PRICE OF QUOTED INVESTMENT 9.48 8.85
Notes to the Standalone Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-35
89
Note No. 12 : CURRENT FINANCIAL ASSETS - TRADE RECEIVABLES
DEBTS OUTSTANDING i) - Secured - Considered good 8289.35 36154.83ii) - Unsecured - Considered good - -iii) - Considered doubtful 886.51 942.77
9175.86 37097.60Less: Allowances for bad & doubtful debts * 886.51 8289.35 942.77 36154.83TOTAL 8289.35 36154.83ALLOWANCES FOR BAD & DOUBTFUL DEBTS *OPENING BALANCE 942.77 935.89Additions during the year 0.31 22.46Amount used during the year 56.57 15.58 CLOSING BALANCE 886.51 942.77
Explanatory Note: - Debt due by Directors or other officers of the company or any of them either severally or jointly with any other person or debts due by firms or private companies respectively in which any Director of the Company is a partner or a Director or a member amounts to H Nil (Previous year H Nil).
Notes to the Standalone Financial Statements (Contd...)
Note No. 13 : CURRENT FINANCIAL ASSETS - CASH & CASH EQUIVALENTS
I. CASH AND CASH EQUIVALENTS i. Cash on hand including imprest 0.25 0.25ii. Balance with Banks
- Current Account 1134.46 658.17II. OTHER BALANCES WITH BANK
Bank deposits upto 3 months maturity from date of original investment- With scheduled banks - - TOTAL 1134.71 658.42
Note No. 14 : CURRENT FINANCIAL ASSETS - BANK BALANCE OTHER THAN CASH & CASH EQUIVALENTS
I. Other Balances with Bank - In Dividend Balance Account 20.31 15.86
II. Bank deposits with more than 3 months and upto 12 months maturity- With scheduled banks 432.21 408.33TOTAL 452.52 424.19
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-36
90
Notes to the Standalone Financial Statements (Contd...)
Note No. 15 : CURRENT FINANCIAL ASSETS - OTHERS
A) ADVANCES*Employees - Secured (considered good) 112.55 69.84- Unsecured (considered doubtful) 2.03 2.03Less : Provisions for doubtful Advances* 2.03 2.03
112.55 69.84B) INTEREST ACCRUED ONi) LC from Customers - 0.78ii) Investments 10.66 9.16 iii) Deposits 29.64 23.92iv) Others 0.36 40.66 0.58 34.44
C) CLAIMS RECOVERABLE Claims recoverable from different agencies 2712.61 3308.75Less: Provision for Doubtful Claims** 179.41 2533.20 133.10 3175.65TOTAL (a+b+c) 2686.41 3279.93DETAILS OF PROVISIONS
PROVISION FOR DOUBTFUL ADVANCES*OPENING BALANCE 2.03 2.03Additions during the year - - Amount used during the year - - CLOSING BALANCE 2.03 2.03
PROVISION FOR DOUBTFUL CLAIMS **OPENING BALANCE 133.10 133.14Additions during the year 46.31 - Amount used during the year - 0.04CLOSING BALANCE 179.41 133.10Explanatory Note: - PARTICULARS OF LOANS AND ADVANCES DUE FROM DIRECTORSi) Amount due at the end of the year H Nil H Nilii) Advance due by firms or private companies in which any Director of the Company is a Partner or a director or a member amounts to H Nil (Previous year H Nil)
Note No. 16 : CURRENT TAX ASSETS (Net)
Income Tax (including advance income tax, TDS & excluding current tax liability) Unsecured - Considered good
1845.39 -
TOTAL 1845.39 -
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-37
91
Notes to the Standalone Financial Statements (Contd...)
Note No. 17 : OTHER CURRENT ASSETS
a) Advances to contractors / suppliers - Secured (considered good) 239.21 218.29- Unsecured (considered good)
– Against Bank Guarantee - - – Others 1127.08 2099.84
- Unsecured (considered doubtful) 679.54 723.332045.83 3041.46
b) Other Advances- secured (considered good) 50.90 50.90- Unsecured (considered doubtful) 13.93 13.93
64.83 64.832110.66 3106.29
Less : Provision for Doubtful Loans and Advances * 693.47 737.261417.19 2369.03
c) Advance to Subsidiary-CCL 6.50 6.50 d) Advance to JV-KABIL 72.00 - e) DEPOSITS
Other Deposits 10136.08 9392.51Less : Provision for Doubtful Deposits ** 75.56 75.56
10060.52 9316.95f) OTHER CURRENT ASSETS
Other Current Assets 211.52 277.33Less: Provision for Other Current Assets *** 3.52 3.52
208.00 273.81g) OTHER RECOVERABLES
IGST/CGST & SGST 25553.61 20001.05 h) RIGHT TO USE
Rent for Leasehold Land 206.61 141.29TOTAL 37524.43 32108.63DETAILS OF PROVISIONSPROVISION FOR DOUBTFUL LOANS AND ADVANCES*OPENING BALANCE 737.26 728.63Additions during the year 2.52 8.63Amount used during the year 46.31 - CLOSING BALANCE 693.47 737.26DETAILS OF PROVISIONSPROVISIONS FOR DEPOSITS **OPENING BALANCE 75.56 75.56Additions during the year - - Amount used during the year - - CLOSING BALANCE 75.56 75.56PROVISION FOR OTHER CURRENT ASSETS ***OPENING BALANCE 3.52 3.52Additions during the year - - Amount used during the year - - CLOSING BALANCE 3.52 3.52
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-38
92
Note No. 18 : EQUITY SHARE CAPITAL
a) AUTHORISED SHARE CAPITAL - Equity Share Capital 1800000000 90000.00 1800000000 90000.00- 7.50% Non-Cum. Redeemable Preference Shares 2000000 20000.00 2000000 20000.00
b) PAR VALUE PER EQUITY SHARE (in J) 5.00 5.00
c) PAR VALUE PER PREFERENCE SHARE (in J) 1000.00 1000.00
d) NO. OF SHARES ISSUED, SUBSCRIBED AND FULLY PAID UP- Equity Share Capital 925218000 46260.90 925218000 46260.90- 7.50% Non-Cum. Redeemable Preference Shares - - - -
TOTAL 46260.90 46260.90
e) RECONCILIATION OF NO. OF SHARES & SHARE CAPITAL OUTSTANDING: No. of
Shares(J in lakh) No. of
Shares(J in lakh)
OUTSTANDING AS ON 01.04.2019 925218000 46260.90 925218000 46260.90Add: Share Capital issued/ subscribed during the year - - - -Less: Reduction in Share Capital - - - -OUTSTANDING AS ON 31.03.2020 925218000 46260.90 925218000 46260.90
f) TERMS/RIGHTS ATTACHED TO EQUITY SHARESThe Company has only one class of Equity Shares having par value of H5/- each and is entitled to one vote per share.
g) SHARES IN THE COMPANY HELD BY EACH SHAREHOLDER HOLDING MORE THAN 5 PERCENT OF THE NUMBER OF SHARES
In No. In (%) In No. In (%)
- President of India 703587852 76.05% 703587852 76.05%- Life Insurance Corporation of India 105685666 11.42% 112338152 12.14%
Particulars As at 31st March, 2020
As at 31st March, 2019
In No. (J in lakh) In No. (J in lakh)
Notes to the Standalone Financial Statements (Contd...)
F-39
93
Note No. 19 : OTHER EQUITY
a) CAPITAL RESERVE *AS PER LAST BALANCE SHEET 21166.24 21166.24
b) GENERAL RESERVEAS PER LAST BALANCE SHEET 8965.97 8965.97
c) CORPORATE SOCIAL RESPONSIBILITY FUNDAS PER LAST BALANCE SHEET - 22.78 Add: During the year - - Less: Amount reversed during the year - - Less: Amount used during the year - 22.78 AS AT BALANCE SHEET DATE - -
d) MINE CLOSURE RESERVEAS PER LAST BALANCE SHEET 163.00 - Add: During the year 75.00 163.00 Less: Amount reversed during the year - - Less: Amount used during the year - - AS AT BALANCE SHEET DATE 238.00 163.00
e) CURRENCY FLUCTUATION RESERVE **AS AT BALANCE SHEET DATE 155.94 - Add: Equity Component of Foreign Currency Loan (2764.59) 155.94 Less: Amount reversed during the year - - Less: Amount used during the year - - AS AT BALANCE SHEET DATE (2608.65) 155.94
f) RETAINED EARNING *** 22004.03 86985.18TOTAL 49765.59 117436.33
Details of Retained Earning ***Profit /(Loss) after tax for the period as per Statement of Profit and Loss
(56935.41) 14551.05
Other Comprehensive Income/(Loss) as per Statement of Profit and Loss (net of tax)
(2245.67) (1090.47)
Total Comprehensive Income /(Loss) for the period (59181.08) 13460.58Balance brought forward 86985.18 76313.10BALANCE AVAILABLE FOR APPROPRIATION 27804.11 89773.68
i) Less :Dividend 4811.14 2313.05 ii) Less :Tax on Dividend 988.94 475.45
BALANCE CARRIED FORWARD 22004.03 86985.18
* Capital Reserve is created from the Grant received from the Government of India during the approval of Financial Re-structuring proposal by Ministry of Mines and out of Capital Profits over the years. This Reserve is not created out of Revenue Profits of the Company.
** Currency Fluctuation Reserve is not created out of Revenue Profits of the Company.
Notes to the Standalone Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-40
94
Notes to the Standalone Financial Statements (Contd...)
Note No. 20 : NON-CURRENT FINANCIAL LIABILITIES - BORROWINGS
LONG TERM LOANS• From Banks/ FIs
- Secured- EXIM Bank (Loan I) - 5443.02
(First charge over the entire movable Fixed Assest of Gujarat Coppr project, both present out future)
(The title deeds for Freehold and Leasehold Land and Building acquired in respect of Gujarat Copper Project are yet to be executed. Pending the same, the title deeds of land of TCP has been submitted as an alternate security over which no hypothecation has been created.)
- EXIM Bank (Loan II) 22647.53 28215.21(First pari-passu charge on movable fixed assets, both present and future of the Company, excluding GCP and TCP)
- SBI 18975.00 17407.50(First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
- UBI 9800.00 - (First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
- HDFC 9500.00(First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
-
- AXIS 2695.00(First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
-
- Unsecured- Axis Bank - 6000.00
TOTAL 63617.53 57065.73
Note No. 21 : NON-CURRENT FINANCIAL LIABILITIES - OTHERSOthers (Compensation received from Govt of Jharkhand for repair of township)
843.53 843.53
TOTAL 843.53 843.53
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-41
95
Notes to the Standalone Financial Statements (Contd...)
Note No. 22 : NON - CURRENT - PROVISIONS
PROVISION FOR EMPLOYEE BENEFITS
i) PROVISION FOR LEAVE ENCASHMENTAS PER LAST BALANCE SHEET 10920.32 11930.19Additions during the year - - Amount used during the year 1887.66 1009.87CLOSING BALANCE 9032.66 10920.32
ii) PROVISION FOR GRATUITY AS PER LAST BALANCE SHEET (5448.73) (3743.46)Additions during the year 2982.00 1094.73Amount used/funded during the year - 2800.00CLOSING BALANCE (2466.73) (5448.73)TOTAL 6565.93 5471.59
(Refer Note No. 39 General Notes on Accounts Point No. 20)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
Note No. 23 : CURRENT FINANCIAL LIABILITIES - BORROWINGS
SHORT TERM LOANS- Cash Credit- From Banks/ FIs 13603.41 16503.81- WCDL- From Banks/ FIs 16300.00 - - Secured (Secured by hypothecation of Stock-in-Trade,Stores
& Spare Parts and Book Debts, both present and future of the Company)
- Working Capital Term Loan (Unsecured)- Axis Bank 22000.00 9702.84- Kotak Mahindra Bank 5000.00 - - HDFC Bank 10500.00 13000.00- IOB 1250.00 - - UBI 1250.00 - LONG TERM LOANS • Due in next 1 year - EXIM Bank (Loan I) 5933.16 5443.04 - EXIM Bank (Loan II) 8108.39 1795.51 - Axis Bank 8105.00 3500.00 - HDFC Bank 500.00 - - UBI Bank 200.00 - TOTAL 92749.96 49945.20
F-42
96
Notes to the Standalone Financial Statements (Contd...)
Note No. 24 : CURRENT FINANCIAL LIABILITIES - TRADE PAYABLE
i) Total outstanding dues of micro entreprises and small enterprises 961.60 535.45ii) Total outstanding dues of creditors other than micro enperprises
and small enterprises22412.82 19693.63
Total 23374.42 20229.08
Note No. 25 : CURRENT FINANCIAL LIABILITIES - OTHERS
i) Interest accrued but not due on borrowings & term loans 505.95 359.97ii) Unpaid dividend 20.31 15.86iii) Deposits/ Retention money 6361.34 5885.05iv) Other liabilities 1694.61 1339.49
Total 8582.21 7600.37
Note No. 26 : OTHER CURRENT LIABILITIES
i) Statutory dues payables 5763.29 4664.42ii) Advances from Customers 3105.82 1977.75iii) Other Liabilities 8113.74 12238.53
Total 16982.85 18880.70
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
Note No. 27 : CURRENT - PROVISIONS
a) PROVISION FOR EMPLOYEE BENEFITS
i) PROVISION FOR LEAVE ENCASHMENTAS PER LAST BALANCE SHEET 1980.85 741.60Additions during the year - 1239.25Amount used during the year 386.97 - CLOSING BALANCE 1593.88 1980.85
ii) PROVISION FOR GRATUITY AS PER LAST BALANCE SHEET (2860.89) (3513.13)Additions during the year 29.48 652.24 Amount used during the year - - CLOSING BALANCE (2831.41) (2860.89)
iii) PROVISION FOR LEAVE TRAVEL CONCESSION (LTC)AS PER LAST BALANCE SHEET 171.93 139.11Additions during the year 26.10 32.82Amount used during the year - - CLOSING BALANCE 198.03 171.93
iv) PROVISION FOR PRP/INCENTIVEAS PER LAST BALANCE SHEET 1727.00 882.00Additions during the year - 1145.00Amount used during the year 582.00 300.00CLOSING BALANCE 1145.00 1727.00
F-43
97
Notes to the Standalone Financial Statements (Contd...)
v) PROVISION FOR WAGE REVISIONAS PER LAST BALANCE SHEET 4258.27 5621.17Additions during the year - - Amount used during the year 2379.40 1362.90CLOSING BALANCE 1878.87 4258.27
b) OTHERSi) DIVIDEND
AS PER LAST BALANCE SHEET - - Additions during the year 4811.14 2313.05Amount used during the year 4811.14 2313.05CLOSING BALANCE - -
ii) TAX ON DIVIDENDAS PER LAST BALANCE SHEET - - Additions during the year 988.94 475.45 Amount used during the year 988.94 475.45 CLOSING BALANCE - -
iii) PROVISION - OTHERSAS PER LAST BALANCE SHEET 1018.59 1366.75Additions during the year 329.46 32.31Amount used during the year 269.79 380.47CLOSING BALANCE 1078.26 1018.59TOTAL 3062.63 6295.75
(Refer Note No. 39 General Notes on Accounts Point No. 19&20)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
Note No. 28 : CURRENT TAX LIABILITIES (Net)
Additions during the year - 8644.62Less : Refund pertaining to earlier years - 310.58 Less : Advance Income Tax & TDS - 6750.08Current Tax Liabilities (Net of Advance Tax & TDS) - 1583.96
F-44
98
Notes to the Standalone Financial Statements (Contd...)
Note No. 29 : REVENUE FROM OPERATIONS
SALE OF PRODUCTS- Domestic 34187.32 91076.52- Export 46129.33 84267.33
80316.65 175343.85Less : Discount & Rebate - 14.55SALES (Net of Discounts) (A) 80316.65 175329.30SALE OF SERVICES (B) 310.79 455.70OTHER OPERATING INCOME (C)
- Sale of Scrap 329.54 987.36- Interest from Customers 116.11 246.35- Interest from Contractors against mobilization
advances for mining operations252.49 262.80
- Penalty & Liquidated Damages 1920.36 1752.00Less : Refunded during the year 60.69 1859.67 203.57 1548.43
- Excess Electricity Charges earlier paid adjusted by MPSEB against current Electricity bills
- 2795.78
TOTAL (C) 2557.81 5840.72TOTAL (A+B+C) 83185.25 181625.72
Note No. 30 : OTHER INCOME
- Claims Received 8.80 10.44- Interest from Term Deposits 29.63 96.62- Interest - Others 992.27 237.87- Profit on sale of Assets - 48.24 - Profit on Fair Value of Investment 0.63 0.67 - Others 2384.06 2176.74- Provisions not required written back # 2280.83 1095.29TOTAL 5696.22 3665.87
Details of Provisions not required written back # (Refer Note No.39 General Notes on Accounts Point No.11)Bad and doubtful Debts,advances/deposits & claims 56.57 16.56 Excess provisions on account of shortage,non-moving,obselete & insurance Stores & Spares and finished goods (net)
266.54 26.93
Provision for Discarded Assets no longer required - 1.16 Prov Written back for feasibility study of Concentrator plant at MCP
827.46 -
Provision for CSR no longer required Written Back - 30.59 Provision for Interest on MSME 264.01 169.94 Provision for MP Rural Infrastructure & Road Development Tax & Water Charges
- 370.78
Excess Provision created for Transportation of Copper Concentrate from KCC to load port
179.56 -
Old Liability Written Back for S. Creditors, SD & EMD more than 5 years and Others
686.69 479.33
TOTAL 2280.83 1095.29
(H in lakh)Particulars For the year ended
31st March, 2020 For the year ended
31st March, 2019
F-45
99
Notes to the Standalone Financial Statements (Contd...)
Note No 32 : CHANGES IN INVENTORIES OF FINISHED GOODS, SEMI-FINISHED AND WORK- IN-PROCESS
A. OPENING STOCK:Finished Goods 1176.03 257.24Semi-Finished and In-Process 58249.42 73504.95TOTAL OPENING STOCK 59425.45 73762.19
B. CLOSING STOCK:Finished Goods 83.00 1176.03Semi-Finished and In-Process 64456.03 58249.42TOTAL CLOSING STOCK 64539.03 59425.45(INCREASE)/ DECREASE (A-B) (5113.58) 14336.74
Note No. 33 : EMPLOYEES BENEFIT EXPENSE
Salaries, Wages & Allowances 21806.24 23320.29Bonus/Ex-gratia/Performance Related Pay 104.00 1426.21Contribution to Provident & Other Funds 2186.55 2263.98Workmen & Staff Welfare Expenses 1568.32 1696.74Gratuity & Leave Encashment 297.20 2944.26TOTAL 25962.31 31651.48Explanatory Note: - The detail of Remuneration paid/payable to Directors as included in above payments are as follows: - (i) Salaries & Allowances 153.84 186.11(ii) Contribution to Provident & Other Funds 13.18 13.99(iii) Re-imbursement of Medical Expenses 1.06 0.53(iv) Leave Encashment 32.83 13.23(v) Gratuity paid 20.00 10.00(vi) Other Benefits 29.68 26.21TOTAL 250.59 250.07
In addition the Whole-time Directors are allowed the use of company car for private purpose and have been provided with residential accomodation as per terms of their appointment / Government guidelines and the charges are recovered at the rates prescribed by the Government.
Note No. 34 : FINANCE COST
- Interest on Cash Credit 2001.93 1339.00- Others (including Term Loans) 4039.96 4207.10TOTAL 6041.89 5546.10
Note No. 31 : COST OF MATERIALS CONSUMED
Raw Materials Consumed 483.29 6269.57Value of Ore Raised During Mine Development 144.95 223.84TOTAL 628.24 6493.41
(H in lakh)Particulars For the year ended
31st March, 2020 For the year ended
31st March, 2019
F-46
100
Notes to the Standalone Financial Statements (Contd...)
Note No. 35 : DEPRECIATION AND AMORTISATION EXPENSE A. DEPRECIATION
Depreciation for the year 4035.92 3966.60Less: Depreciation transferred to Mine Development Expenditure
446.57 304.95
SUB TOTAL (A) 3589.35 3661.65
B. AMORTISATIONAmortisation during the year * 25271.73 21627.10SUB TOTAL (B) 25271.73 21627.10TOTAL (A+B) 28861.08 25288.75
* Amortisation during the year is in relation to the expenses incurred on mines which are under operation/production and does not include expenditure on prospecting of minerals in new mines area.
Note No. 36 : OTHER EXPENSES
A. OTHER MANUFACTURING EXPENSES- Stores,Spares& Tools Consumed 10618.82 11706.53- Consumption of Power, Fuel & Water 17757.59 22186.57- Royalty, Cess & Decretal amount 7717.04 9803.47- Contractual Job for Process 16744.17 13905.88- Handling & Transportation 2975.64 6811.67- Expenses for Leasehold Land 206.61 141.29SUB TOTAL (A) 56019.87 64555.41
B. REPAIRS & MAINTENANCE & MAJOR OVERHAUL EXPENSES- Building 145.54 195.08- Machinery 4003.83 4889.34- Others 817.77 681.86SUB TOTAL (B) 4967.14 5766.28
C. ADMINISTRATION EXPENSES- Insurance 383.85 204.77- Rent 131.67 134.42- Rates and Taxes 1132.38 766.15- Security Expenses 804.49 970.41- Travelling and Conveyance 410.12 562.57- Telephone, Telex and Postage 129.69 143.77- Advertisement and Publicity 246.45 174.90- Printing and Stationery 70.15 125.70- Books & Periodicals 1.81 3.63- Consultancy Charges - Indigenous 1006.15 751.17- Loss on Sale of Assets(Net) 2.04 -
(H in lakh)Particulars For the year ended
31st March, 2020 For the year ended
31st March, 2019
F-47
101
Notes to the Standalone Financial Statements (Contd...)
- MTM Debit/(Credit) Foreign Exchange (20.80) 1071.48- Exchange Rate Variation (Net) - 0.17 - Corporate Social Responsibility Expenses 331.01 185.38- Hire Charges 299.63 387.75- Audit Expenses (Refer detail below at Sl 1) 41.96 30.13- Independent Directors Expenses 12.75 10.35- Bank Charges 176.93 155.01- Other General Expenses 1241.08 1041.33SUB TOTAL (C) 6401.36 6719.09
D. PROVISIONS (Refer detail below at Sl 2) 18884.59 1899.68TOTAL (A+B+C+D) 86272.96 78940.47
Explanatory Note: - 1) Detail of Audit Expenses are as under: -
i) Statutory Auditors- Statutory Audit Fees 16.20 11.00- Tax Audit Fees 5.16 0.89- In Other Capacity 14.95 8.65- Reimbursement of Expenses 2.29 38.60 5.81 26.35
ii) Cost Auditors- Cost Audit Fees 0.70 0.61- Reimbursement of Expenses 0.47 1.17 0.86 1.47
iii) Internal Auditors- Audit Fees 0.65 0.65- Reimbursement of expenses 1.54 2.19 1.66 2.31
TOTAL 41.96 30.132) Detail of Provisions are as under: -
Doubtful debts 0.31 - Doubtful advances / deposits 2.52 9.82Provisions for Obsolete /Non-moving Stores 1.05 108.71Provisions for WIP & Finished Goods 18331.80 - Provisions for Capital Work In Progress 131.88 695.58Provisions for Loss of Assets - 631.54Interest on MSMED 323.68 291.03Provision for Mine Closure Expenditure 75.00 163.00Provision for Loss of Subsidiary 18.35 -
TOTAL 18884.59 1899.68
(H in lakh)Particulars For the year ended
31st March, 2020 For the year ended
31st March, 2019
F-48
102
Note No. 38 : OTHER COMPREHENSIVE INCOME/(LOSS)
A(i) Items that will not be reclassified to Profit/(Loss)Acturial gain/loss recognised in the year for employees : Gratuity (3000.95) (1676.21)TOTAL (A(i)) (3000.95) (1676.21)
A(iI) Income Tax relating to items that will not be reclassified to Profit /(Loss)
755.28 585.74
TOTAL (A(ii)) 755.28 585.74 B(i) Items that will be reclassified to Profit/ (Loss) -
TOTAL (B(i)) - - B(ii) Income Tax relating to items that will be reclassified to
Profit /(Loss)TOTAL (B(ii)) - -
Note No. 37 : TAX EXPENSE
CURRENT TAX Income Tax Provision - 8656.75Income Tax relating to earlier years 842.18 472.18Deferred Tax Account 2295.83 (667.91)TOTAL 3138.01 8461.02
Notes to the Standalone Financial Statements (Contd...)
(H in lakh)Particulars For the year ended
31st March, 2020 For the year ended
31st March, 2019
F-49
103
Note No. 39 : GENERAL NOTES ON ACCOUNTS1. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)
(i) Contingent Liabilities: -a. Claims against the company not acknowledged as debt : 2019-20
(J in lakh)2018-19
(J in lakh)i. Disputed VAT / CST / Entry Tax 3516.76 3347.51ii. Disputed Excise Duty 2947.97 5747.41iii. Disputed Income Tax / Provident Fund 23113.43 11101.54iv. Other Demand 39110.70 34578.47SUB-TOTAL (A) 68688.86 54774.93b. Other money for which the company is contingently liable :i. Bank Guarantee 2767.54 2585.42ii. Letter of Credit 53.26 1894.47iii. Bill discounting - 6636.44SUB-TOTAL (B) 2820.80 11116.33GRAND TOTAL (A+B) 71509.66 65891.26
(ii) Commitments:-Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of advance and deposit)
73913.51 86661.55
Details of Claims against the Company not acknowledged as debt (of 1(i)(a) above)
VAT/CST/ENTRY TAX
There are demand notices totaling to Gross Demand of H3516.76 lakh (Previous Year H3347.51 lakh) from various State Revenue Authorities regarding VAT/CST/Entry Tax against which the company has deposited under protest H620.44 lakh (Previous Year H610.33 lakh). The company is contesting the demand and the management as well as the legal advisors/consultants are of the opinion that its contention will likely to be upheld by the Appellate Authorities. The company also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the company.
EXCISE DUTY There are demand notices totaling to Gross Demand of H2947.97 lakh (Previous Year H5747.41 lakh) from Central Excise
Authorities regarding Excise Duty against which the company has deposited under protest H68.37 lakh (Previous Year H30.34 lakh). The company is contesting the demand and the management as well as the legal advisors/consultants are of the opinion that its contention will likely to be upheld by the Appellate Authorities. The company also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the company.
INCOME TAX/PROVIDENT FUND There are Income Tax demand notices totaling to Gross Demand of H23113.43 lakh (Previous Year H11101.54 lakh). The
management as well as the income tax consultant are of the opinion that its contention will likely to be upheld by the Appellate Authorities/High Court. The company also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the company.
OTHER DEMAND of J38685.29 lakh (Previous Year J34578.47 lakh) The major pending litigation cases are as follows:
a. The Municipal Council, Malanjkhand, raised a demand on Malanjkhand Copper Project (MCP) amounting to H7046.64 lakh on account of penalty on Terminal Tax for the periods from financial year 2000-01 to 2005-06 on the ground of short payment of Terminal Tax by adopting higher assessable value as well as higher of Metal in Ore
Notes to the Standalone Financial Statements (Contd...)
NOTES FORMING PART OF ACCOUNTS
F-50
104
(MIO) produced and Metal in Concentrate (MIC) despatched. The matter was contested by the company before the Hon’ble High Court, Jabalpur, M.P. and the company paid H352.33 lakh towards penalty Terminal Tax as per the order of Hon’ble High Court, Jabalpur, M.P. Subsequently the matter was turned down by the Hon’ble High Court, Jabalpur, M.P. The Company filed writ petition before the Hon’ble Supreme Court of India. The Hon’ble Supreme Court vide its order dated 29.07.2011 directed the Company to deposit an ad-hoc amount of H1000.00 lakh to Municipal Council, Malanjkhand which has since been deposited by the company and shown as ‘Deposits with Court’ and also ordered that the matter may be heard on the ground of merit by the Civil Court, Baihar. Further a demand of H18867.56 lakh for the periods from 2006-07 to 2011-12 was also raised on the above ground for which the appeal by the company is pending before the Hon’ble Supreme Court. Pending final decision, the full amount of H25914.20 lakh has been disclosed under ‘Contingent Liability’.
b. The Deputy Registrar, Khetri, Rajasthan issued demands on KCC for H4819.27 lakh on account of re-assessment of land tax for Khetri, Kolihan & Chandmari mines for several years. The company has already paid H2211.61 lakh against the same. The matter is contested by the company before the Assessing Authority. Pending final decision, the full amount of H4819.27 lakh has been disclosed under ‘Contingent Liability’.
c. The Municipal Council, Malanjkhand, Madhya Pradesh issued demands on MCP for H558.24 lakh on account of Property Tax for several years against which the company filed writ petitions before the Hon’ble Madhya Pradesh High Court, Jabalpur challenging the demand notice. The amount of H558.24 lakh has been included under ‘Contingent Liability’.
d. There was a trade dispute with M/S Bhagawati Gases Ltd (BGL) in connection with an agreement to supply of gaseous oxygen at Khetri Copper Complex. The dispute was referred to Arbitration. The claim of BGL is for an amount of H1079.80 lakh with a corresponding counter claim of H534.62 lakh by the company. The arbitral award went against the company. The company had filed an appeal before the Hon’ble High Court of Rajasthan and the same was admitted for hearing. The Company preferred appeal before the Hon’ble Rajasthan High Court regarding interim deposit of arbitral award pending disposal of original appeal, but the same was dismissed. Thereafter the Company had preferred appeal before Hon’ble Supreme Court and the Hon’ble Supreme Court passed the order directing the Company to deposit the entire decrial amount along with interest amounting to H1733.50 lakh in the form of Fixed Deposit. The Company deposited the said amount and shown the same as Deposit in Current assets. Pending decision of the original appeal against arbitral award before the Hon’ble Rajasthan High Court, the said amount of H1733.50 lakh has been disclosed under ‘Contingent Liability’.
e. There was a demand from M/S Uttkal Moulders amounting to H1662.72 lakh regarding interest for delayed payment against supply of grinding media balls at Malanjkhand Copper Project. The case is pending before the Sole Arbitrator. Pending final decision, the said amount of H1662.72 lakh has been disclosed under ‘Contingent Liability’.
f. In addition there are number of pending litigation cases against the company claiming demand of H3997.36 lakh by retired employees, third parties etc. which the company is contesting before different Legal Forums / Courts.
The management as well as the legal advisors/consultants are of the opinion that its position will likely to be upheld in the appellate proceedings. The company also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the company.
2. During the year, the company has incurred loss and hence not provided any liability towards Performance Related Pay payable to the executives (Previous Year H1145.00 lakh) as per terms of DPE guidelines.
3. Lease premium paid for land for mining purposes including payment for Net Present Value (NPV) of forest area paid to forest department is capitalized under the head Prepaid Expenses shown under Note No. 9(d) & 16(g).
4. The lease agreements of Kendadih and Rakha Mining Lease at ICC has been renewed and executed by the Govt of Jharkhand in respect of leasehold lands valid upto 02.06.2023 and 28.08.2021 respectively. In respect of Surda Mining Lease, the lease agreement has expired on 31.03.2020 and the company has applied for extension of the lease agreement which is under active consideration of the Govt of Jharkhand.
Notes to the Standalone Financial Statements (Contd...)
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5. The commercial operation of Smelter, Refinery and Sulphuric Acid Plant at Khetri Copper Complex (KCC) were suspended since December 2008. The Company suffered loss on account of impairment of the said plants valued by an independent consultant in earlier years and consequently a total sum of H464.01 lakh was provided in the accounts for impairment loss in compliance with the guidelines of IND AS 36 on “Impairment of Assets” as on 31.03.2020. Total inventory valued H33.21 lakh (Previous Year H33.21 lakh) which remained as process material in the above Plant is included in the Inventory of the company. The management is of the opinion that such inventories consisting mainly of metal content and having realizable value at least equal to the amount at which they are stated.
6. The title deeds for Freehold and Leasehold Land and Building acquired in respect of Gujarat Copper Project (GCP) with book value of H5578.11 lakh are yet to be executed (Previous year H5859.97 lakh).
7. At ICC, Pollution Control Plant under Package I & III amounting to H2100.50 lakh have not been capitalized for want of completion of trial / guarantee run as per terms of contract. As a matter of prudence, full provision for the same has been made in the accounts to take care of efflux of time over the years.
8. Confirmation letters of majority of balances under the heads Sundry Creditors, Claims Recoverable, Loans & Advances, Sundry Debtors and Deposits from and with various parties/ Government Departments have been sent but in number of cases such confirmation letters from the parties are yet to be received.
9. During the year, the company has spent a sum of H331.01 lakh on account of Corporate Social Responsibility (CSR) expenses.
Amount spent during the year on:Sl. No. Particulars in cash In cash Yet to be paid Total(i) Construction/acquisition of any asset - - -(ii) On purposes other than (i)above H331.01 lakh - H331.01 lakh
10. Information related to Micro, Small and Medium Enterprises Development Act, 2006 is disclosed hereunder:
a) i) Principal amount remaining unpaid to any supplier at the end of the financial year H961.60 lakhii) Interest due on above H248.49 lakh
b) Amount of interest paid by the buyer in terms of Section 16 of the Act, along with amount of payment made beyond the appointed date during the year
-
c) Amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the due date during the year) but without adding the interest specified under the Act
H730.36 lakh
d) Amount of interest accrued and remaining unpaid at the end of the financial year H978.85 lakhe) Amount of further interest remaining due and payable even in the succeeding years, until
such date when the interest dues as above are actually paid to the Small enterprise, for the purpose of disallowance as a deductible expenditure under Section 23 of the Act
H NIL
The information has been given of such vendors to the extent they could be identified as “Micro and Small” enterprises on the basis of information available to the Company.
Notes to the Standalone Financial Statements (Contd...)
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11. During the year the Company has written back old liabilities / provisions amounting to H2280.83 lakh (Previous Year H1095.29 lakh) in the accounts, the details of which are as under :-
Sl. No. PARTICULARS J in lakh REASONS FOR REVERSAL1. Excess provision on account of shortage, non-
moving & obsolete Stores & Spares written back in respect of MCP – H0.15 lakh, GCP – H66.57 lakh & KCC – H199.82 lakh
266.54 Consequent to physical verification conducted and on reconciliation with book records during the year, the excess provision at the end of the year has been written back to revenue.
2. Excess provision for doubtful debts no longer required is written back in TCP – H41.24 lakh & KCC – H15.33 lakh
56.57 The relevant amount of debts were recovered from the customers/parties and hence the provision for doubtful debts created in earlier years has been written back.
3. Excess provision created for transportation of copper concentrate from KCC to the load port
179.56 The excess provision created for transportation of copper concentrate has been written back
4. Write back of provision against feasibility study of Concentrator Plant at MCP
827.46 The provision against Capital Work in Progress has been written back to Revenue and equivalent amount has also been charged to Revenue resulting NIL impact in the profitability of the company.
5. Excess provision for interest on MSME is written back in TCP – H0.38 lakh & MCP – H263.63 lakh
264.01 Excess provision for interest on MSME created in earlier years has been written back.
7. Liability for unclaimed EMD, SD & Sundry Creditors for more than 5 years written back at ICC – H42.81 lakh, KCC – H78.15 lakh, MCP – H563.80 lakh & RSOW – H1.93 lakh
686.69 The unclaimed liability for EMD, SD & Sundry Creditors unmoved for more than 5 years has been written back
TOTAL 2280.83
12. Management has not become aware of any instance of fraud by the company or any fraud on the company by its officers and employees during the current financial year.
13. The Company has closed / suspended many of its mining operations located at various places, Fertilizer Plant at Khetri in different years due to their uneconomic operations. As per requirement of IND AS 105 on “Non-current Assets Held for Sale and Discontinued Operations” the following information for the year are furnished:
(H in lakh)(Previous year figures in brackets)
MSB GROUP OF MINES
RCP CCP DCP Fertilizer Plant
i) Initial disclosure event (Year of closure)
1997 to 2003 2001 2002 1994 2001
ii) Carrying amount of Assets
No separate records maintained
490.05(503.89)
-(-)
-(-)
No separate records are maintainediii) Liabilities to be settled 137.17
(137.17)73.04
(73.04)3.38
(3.38)iv) Amount of income -
(-)-
(-)-
(-)-
(-)v) Amount of expenses -
(-)34.70*(34.70)
-(-)
vi) Gain on sale of assets (Included in iv above)
-(-)
-(-)
-(-)
-(-)
* This is included in cash generated from operations in the Cash Flow Statement.
Notes to the Standalone Financial Statements (Contd...)
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14. Since the company is primarily engaged in the business of manufacture and sale of copper products, the same is considered to be the only primary reportable business segment and accordingly has been reported. As the Company operates predominantly within the geographical limits of India, no secondary segment reporting has been considered as per IND AS 108 “Operating Segments”.
15. Sales for the period include FOB value of Export Sales:-2019-20 2018-19
Qty (MT) J in lakh Qty (MT) J in lakhAnode Slime 25.040 1995.90 19.800 2004.64Copper Reverts 265.347 815.91 670.934 2027.10Copper Concentrate (CMT) 10647.339 43317.52 19571.433 80235.59Total 46129.33 84267.33
16. In terms of IND AS 24 on “Related Party Disclosures”: The company does not have any Advances provided to its Subsidiary and Joint Venture Company as at the year-end
except as is disclosed below:
Transactions with Related Party during the year and balance outstanding as on 31.03.2020H in lakh
Name of Related Party Nature of Relationship
Type of Transaction Year ended31.03.20 31.03.19
Chhattisgarh Copper Limited (CCL) Subsidiary Investment in shares as on 18.50 18.50Advances given as on 6.50 6.50
Name of Related Party Nature of Relationship
Type of Transaction Year ended31.03.20 31.03.19
Khanij Bidesh India Limited (KABIL) Joint Venture Investment in shares as on 3.00 -Advances given as on 72.00 -
The remuneration of Key Management Personnel are given below:Particulars Key Management Personnel Total Remuneration
Functional Directors Year ended 2019-20 Year ended 2018-19
Receiving of Services
1. Sri Arun Kumar Shukla Chairman-cum-Managing Director
12.37(w.e.f. 01.01.2020)
-
2. Sri Santosh Sharma Chairman-cum-Managing Director
44.31(upto 31.12.2019)
66.45
3. Sri K D Diwan Chairman-cum-Managing Director
1.55(Arrear PRP)
21.11(Arrear Gratuity & PRP)
4. Sri Anupam Anand Director (Personnel)
10.55(upto 04.08.2019)
59.01
5. Sri S K Bhattacharya Director (Mining)
93.70(upto 31.12.2019)
49.03
6. Sri S K Bandyopadhyay Director (Finance)
52.41 32.55
7. Sri Arun Kumar Shukla Director (Operations)
35.70(upto 31.12.2019)
21.92
OTHER THAN FUNCTIONAL DIRECTORS8. Sri C S Singhi Company Secretary
51.28 43.80
Notes to the Standalone Financial Statements (Contd...)
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INDEPENDENT DIRECTORS
Smt Simantini Jena – Date of appointment – 17.11.2015 & Re-appointed on 17.11.2018 to 16.11.2019
Sri Hemant Mehtani - Date of appointment – 17.11.2015 & Re-appointed on 17.11.2018 to 16.11.2019
Sri D R S Chaudhary - Date of appointment – 01.12.2015 & Re-appointed on 01.12.2018 to 30.11.2019
Sri Subhash Sharma – Date of appointment – 18.02.2018
Sri Pawan Kumar Dhawan – Date of appointment – 22.07.2019
Sri Balwinder Singh Canth – Date of appointment – 22.07.2019
Sri Kalyansundaram – Date of appointment – 22.07.2019
Sl. No. Payment to Independent Directors Year ended 31.03.2020 Year ended 31.03.2019 1. Sitting Fees 12.75 10.35
Balance Outstanding with Key Managerial Personnel as on 31.03.2020Sl. No. Particulars As on 31.03.2020 As on 31.03.2019 1. Amount payable Nil Nil2. Amount receivable Nil Nil
17. In terms of IND AS 33 on “Earning per Share” :(H in lakh)
BASIC DILUTEDProfit / (Loss) After Tax (-) 56935.41
(14551.05)(-) 56935.41
(14551.05)Denominator used: Weighted average number of Equity Shares of H5/- (Previous year H5/- each) outstanding during the period.
925218000(925218000)
925218000(925218000)
Earning Per Share (H) (-) 6.154(1.573)
(-) 6.154(1.573)
18. The Company has accounted for Deferred Tax in accordance with the guidelines of IND AS 12 on “Income Taxes” issued by The Institute of Chartered Accountants of India. The Deferred tax balances are set out below:-
DEFERRED TAX ASSET (NET): - (H in lakh)
Particulars Deferred Tax Asset/ (Liability) as at 01.04.2019
Credit/(Charge)
during 2019-20
Deferred Tax Asset/ (Liability) as at 31.03.2020
Deferred Tax Asset :-Difference between provision made in accounts and claims made as per I. T Act
9243.90 (3379.68) 5864.22
9243.90 (3379.68) 5864.22Deferred Tax Liability :-Difference between net book value of depreciable capital assets vis-a-vis WDV as per IT Act
(2998.28) 1083.85 (1914.43)
(2998.28) 1083.85 (1914.43)Deferred Tax Asset (Net) – Recognised in Statement of Profit & Loss
6245.62 (2295.83) 3949.79
Deferred Tax Asset (Net) - Defined Benefit Plan – Recognised in OCI
585.74 755.28 1341.02
Total Deferred Tax Asset (Net) 6831.36 (1540.55) 5290.81
Notes to the Standalone Financial Statements (Contd...)
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19. PROVISIONS FOR CONTINGENCIES: -(H in lakh)
Particulars Discarded Fixed Assets
Capital WIP & Advance
Mines Development Expenditure
Others TOTAL
Carrying amount as at 01.04.2019
1838.56 4088.49 4664.86 16400.84 26992.75
Amount provided during the year
- - - 27549.44 27549.44
Amounts utilized against provision
- 695.58 - 11675.31 12370.89
Carrying amount as at 31.03.2020
1838.56 3392.91 4664.86 32274.97 42171.30
20. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS IN TERMS OF Ind AS 19 :
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded through Life Insurance Corporation of India, SBI Life Insurance Co. Ltd. and India First Life Insurance and are managed by separate trust. The Company has also funded through Life Insurance Corporation of India and SBI Life Insurance Co. Ltd towards leave encashment. Expenses recognized in Statement of Profit & Loss and Other Comprehensive Income amounting to H3450.73 lakh in respect of Gratuity, Leave Encashment and Leave Travel Concession which have been provided for as stated below.
The following tables summarize the components of net benefit expense recognized in the Statement of Profit and Loss, Other Comprehensive Income and Mine Development Expenditure and the funded status and amounts recognized in the balance sheet for the respective plans.
(H in lakh)Gratuity
(Funded plan)Leave Encashment (Partially funded
Plan)
Leave Travel Concession (Non-
funded Plan)(i) Changes in Present Value of Obligation
Present Value of obligation as on last valuationCurrent service costInterest costTotal Actuarial gain/loss Benefits PaidPresent value of obligation as on valuation date
(ii) Changes in Fair Value of Plan AssetsFair value of Plan Assets at Beginning of periodInterest IncomeEmployer ContributionsBenefits paidReturn on Plan Assets excluding Interest IncomeFair value of Plan Assets at End of measurement period
(iii) Table Showing Reconciliation to Balance SheetFunded StatusFund AssetFund Liability
13501.90813.77709.06
3000.955353.13
12672.55
21811.521512.30
-5353.13
-
17970.69
5298.1417970.6912672.55
12901.17994.66752.32
(1190.91)2830.70
10626.54
3334.27246.46
2830.262830.70
-
3580.29
(7046.24)3580.30
10626.54
171.93
129.64103.54198.03
Notes to the Standalone Financial Statements (Contd...)
F-56
110
Notes to the Standalone Financial Statements (Contd...)
(H in lakh)Gratuity
(Funded plan)Leave Encashment (Partially funded
Plan)
Leave Travel Concession (Non-
funded Plan)(iv) Expenses recognized in the Statement of Profit
and Loss AccountCurrent service costNet Interest costActuarial (gain)/loss Benefit Cost (Expense Recognized in Statement of Profit/loss)
(v) Other Comprehensive IncomeTotal Actuarial (gain)/lossReturn on Plan Asset, Excluding Interest IncomeBalance at the end of the PeriodNet(Income)/Expense for the Period Recognized in OCI
(vi) Table Showing Plan AssumptionsDiscount RateExpected Return on Plan AssetRate of Compensation Increase (Salary Inflation) etcAverage expected future service (Remaining working Life)Mortality TableSuperannuation at age-MaleSuperannuation at age-FemaleEarly Retirement & Disablement (All Causes Combined)
813.77(803.24)
-10.53
3000.95-
3000.953000.95
6.55% p.a.7.50%,7.00%,6.50%
6.00% p.a.10 years
IALM 2006-2008 ULTIMATE
60 years60 years1% p.a.
994.66505.86
(1190.91)309.61
----
6.55% p.a.7.00%,7.50%
6.00% p.a.10 years
IALM 2006-2008 ULTIMATE
60 years60 years1% p.a.
129.64129.64
6.55% p.a.--
10 yearsIALM 2006-2008
ULTIMATE60 years60 years1% p.a.
The details of the plan assets as on 31.03.2020 towards gratuity & leave encashment are as follows:
(H in lakh)Investment in Life Insurance Corporation of India 2778.47Investment in SBI Life Insurance Co. Ltd 18154.63Investment in India First Life Insurance 615.83Fund with Gratuity Trust Savings Bank Accounts 2.06Total 21550.99
Actual Return on Plan Assets during the year - H1758.76 lakh.The estimates of future salary increases were considered in actuarial valuation after taking into account inflation, seniority, promotion and other relevant factors. Further, the expected return on plan assets is determined considering several applicable factors mainly the composition of plan assets held, assessed risk of asset management and historical returns from plan assets.
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21. Financial Instrument1. Derivatives not designated as hedging instruments
The Company uses Commodity Futures Contracts to manage its commodity price risk . The Commodity Futures Contracts are not designated as hedging instrumnets and are entered into for periods consistent with commodity price risk exposure of the underlying transactions, generally from one to four months. However in the year FY 19-20, the Company has not entered into any Commodity Futures Contract.The Company uses foreign exchange forward contracts to manage some of its transaction exposures. The foreign exchange forward contracts are not designated as cash flow hedges and are entered into for periods consistent with foreign currency exposure of the underlying transactions, generally from one to four months. Commodity price riskThe Company purchases copper blister/ anode on an ongoing basis for its operating activities in its Gujarat Copper Project (GCP) plant for the production of cathode. To hedge itself against the volatility in LME copper prices in the international market has led to the decision to enter into commodity future contracts. However in the year FY 19-20, the Company has not purchased any such copper blister/ anode for its plant in GCP.These contracts, which commenced in August 2016, are expected to reduce the volatility attributable to price fluctuations of copper. Hedging the price volatility of copper purchases is in accordance with the Risk Management Policy approved by the Board of Directors. The hedging relationships are for a period between 1 and 4 months based on existing purchase agreements. The Company designated only the spot-to-spot movement of the entire commodity purchase price as the hedged risk. It has been decided by the company not to follow the hedge accounting for these instruments. As at 31 March 2020, the fair value of the open position of commodity future contracts is nil.
2. Financial Instruments by CategoriesThe carrying value and fair value of financial instruments by categories were as follows:Set out below, is a comparison by class of the carrying amounts and fair value of the Company’s financial instruments, other than those with carrying amounts that are reasonable approximations of fair values:
(Amount in H lakh)Particulars Total carrying
value as at March 31, 2020
Total carrying value as at
March 31, 2019
Fair Value as at March 31, 2020
Fair Value as at March
31, 2019Financial Assets at FV through Statement of Profit & LossMutual Funds 7.84 7.84 9.48 8.85Derivatives not designated as hedgesFuture Contract Receivable on commodity - - - - Total of Financial Assets 7.84 7.84 9.48 8.85Financial LiabilitiesDerivatives not designated as hedgesForward Cover Contract Liability - - - -Total of Financial Liabilities - - - -
3. The Management considered the Service fees of H15 lakh paid on the Exim Bank Term loan amounting to H30000 lakh drawn on 29.05.2018 as immaterial, as the amount of service fee was only 0.019% of the Turnover (FY 2019-20) of the company and hence the same was not considered as a transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further, the Management assessed that for the purpose of IND AS 109, the carrying value of loan is considered as its fair value as no loan could be provided at a rate lower that the rate of interest of Exim Bank loan for similar terms and conditions of the loan at that point of time.
Similarly, the Management considered the total of Upfront fees & Other charges of H245.33 lakh paid on the SBI ECB loan amounting to H17734.75 lakh drawn during July 2018 to January 2019 as immaterial, as the amount of such fees/charges was only 0.305% of the Turnover (FY 2019-20) of the company and hence the same was not considered as a transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further, the
Notes to the Standalone Financial Statements (Contd...)
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Management assessed that for the purpose of IND AS 109, the carrying value of loan is considered as its fair value as no loan could be provided at a rate lower that the rate of interest of SBI ECB loan for similar terms and conditions of the loan at that point of time.
The Management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:
The Company enters into derivative financial instruments with various counterparties, principally with financial institutions having Investment grade credit ratings. Foreign exchange forward contracts and commodity futures contracts are valued using valuation techniques, which employs the use of market observable inputs. The most frequently applied valuation techniques include forward pricing .
4. Fair Value Hierarchy● Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) in active
markets.● Level 2 - Level 2 hierarchy includes financial instruments measured using inputs other than quoted prices
included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
● Level 3 - Level 3 hierarchy includes financial instruments measured using inputs that are not based on observable market data (unobservable inputs).
The following table presents fair value hierarchy of assets and liabilities measured at fair value
Particulars Date of Valuation Level 1 Level 2 Level 3 TotalFinancial Assets at FV through Statement of Profit & LossNon-derivative financial assets Mutual funds 31/Mar/2020 9.48 - - 9.48Derivative financial assets Future Contract Receivable on commodity 31/Mar/2020 - - - - "Liabilities measured at fair value: Derivative financial liabilities"Forward Cover Contract Liability 31/Mar/2020 - - - -Assets measured at FV through OCI 31/Mar/2020 - - - -
Particulars Date of Valuation Level 1 Level 2 Level 3 TotalFinancial Assets at FV through Statement of Profit & LossNon-derivative financial assets Mutual funds 31/Mar/2019 8.85 - - 8.85Derivative financial assets Future Contract Receivable on commodity 31/Mar/2019 - - - - "Liabilities measured at fair value: Derivative financial liabilities"Forward Cover Contract Liability 31/Mar/2019 - - - - Assets measured at FV through OCI 31/Mar/2019 - - - -
Notes to the Standalone Financial Statements (Contd...)
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5. Financial Risk ManagementFinancial risk factorsThe Company's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company's primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. Risk Exposure arising from Measurement ManagementMarket risk- Foreign Exchange
Future commercial transactions, Recognised financial assets and financial liabilities
Sensitivity analysis
Forward foreign exchange contracts and natural hedge as sales are also demoniated in foreign excchange.
Market-Commodity Price Risk
Purchase of Copper Price Sensitivity Commodity Futures Contract
Credit risk Trade receivables Ageing analysis Sales are mainly done against Advance or Letters of Credit
Liquidity risk Borrowings and other liabilities Rolling cash flow forecasts
Cash flow management
a) Market Risk i) Foreign Currency RiskThe Company operates at international level which exposes the company to foreign currency risk arising from foriegn currency transaction primarily from Imports,exports and foreign currency borrowing. Foreign currency risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency other than INR as on reporting date.
(Amount in J lakh as of March 31,2020)Particulars J In lakhCash & cash equivalents -Trade Receivables 7114.00Trade Payables -Loans (55664.08)Others (if any) -Net Assets/ (-) Liabilities (48550.08)
(Amount in J lakh as of March 31,2019)Particulars J In lakhCash & cash equivalents -Trade Receivables 32203.00Trade Payables -Loans (68007.12)Others (if any) -Net Assets/ (-) Liabilities (35804.12)
Sensitivity The sensitivity of profit or loss to changes in exchange rate arises mainly from foreign currency denominated financial instrument. Particulars Impact on profit before tax
March 31, 2020 March 31, 2019Increase by 5% 2,783.20 3,400.36 Decrease by 5 % (2,783.20) (3,400.36)
ii) Commodity Price RiskThe company's exposure to Commodity price from copper price fluctuation in international market does not arise as the company hedges all its imports through Future contracts at LME.
Notes to the Standalone Financial Statements (Contd...)
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b) Credit RiskCredit risk refers to the risk of default on its obligation by the Debtors resulting in a financial loss. The company sells majority of its products either against Advance from Customers or Letters of Credit. Accordingly, credit risk from Trade receivables has not been cosidered as credit risk.
Credit risk exposureAn analysis of age of Trade receivables at each reporting date is summarized as follows:
(Amount in H lakh)Particulars 31-Mar-2020 31-Mar-2019
Gross GrossNot past due - -Past not more than six months 5712.45 29162.70Past due more than six months but not more than one year 553.20 2247.62More than one year 2910.21 5687.28Total 9175.86 37097.60Less Allowances for Bad & Doubtful Debts 886.51 942.77Net Debtors 8289.35 36154.83
Customer credit risk is managed by each business unit subject to the Company's established Marketing policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored and any shipments to major customers are generally covered by letters of credit or other forms of credit insurance. The maximum exposure to credit risk at the reporting date is H886.51 lakh for which full provision has been made in the accounts as disclosed in Note No 12.
Other financial assetsCredit risk relating to cash and cash equivalents is considered negligible because our counterparties are scheduled banks. We consider the credit quality of Term deposits with such banks as good as these banks are under the regulartory framework of Reserve Bank of India. We review these banking relationships on an ongoing basis.
c) Liquidity RiskOur liquidity needs are monitored on the basis of monthly and yearly projections. The company's principal sources of liquidity are cash and cash equivalents and cash generated from operations.We manage our liquidity needs by continuously monitoring cash inflows and by striving to maintain adequate cash and cash equivalents. Net cash requirements are compared to available cash in order to determine any shortfall. Short term liquidity requirements consists mainly of Loans, Sundry creditors, Expense payable, Employee dues arising during the normal course of business as of each reporting date. We strive to maintain a sufficient balance in cash and cash equivalents to meet our short term liquidity requirements.The table below provides details regarding the contractual maturities of financial liabilities. The table has been drawn up based on the undisclosed cash flows of financial liabilities based on the earliest date on which the company can be required to pay.
(Amount in H lakh as of March 31, 2020)Particulars On
DemandLess than 3
months3 months to 1 year
1-3 years 3-5 years 5-7 years
Total
Short term borrowings (cash credit)
13603.41 - - - - - 13603.41
Short term borrowings (Others)
- 36800.00 19500.00 - - - 56300.00
Long Term Borrowings - 2175.00 10515.79 61548.29 12225.00 - 86464.08Total 13603.41 38975.00 30015.79 61548.29 12225.00 - 156367.49
Notes to the Standalone Financial Statements (Contd...)
F-61
115
(Amount in H lakh as of March 31, 2020)Particulars On
DemandLess than 3
months3 months to 1 year
1-3 years 3-5 years 5-7 years Total
Short term borrowings (cash credit)
16503.81 - - - - - 16503.81
Short term borrowings (Others)
- 22702.84 - - - - 22702.84
Long Term Borrowings - 756.51 9982.04 32467.53 23147.58 1450.62 67804.28Total 16503.81 23459.35 9982.04 32467.53 23,147.58 1,450.62 107010.93
NB: 1. Under RBI Notification No. RBI/2019-20/186 dated 27.03.2020 the scheduling of loan instalments has been given as per approval received from banks under COVID-19- Regulatory Package.2. Under RBI Notification No. RBI/2019-20/244 dated 23.05.2020, the company has applied for deferral of loan instalments amounting to H25350.00 lakh for a period of 3 months. The approvals are in process and hence effect of the same is not considered above. This is as per COVID-19- Regulatory Package.
6. Capital Management For the purpose of the Company's capital management, capital includes issued equity capital and all other equity
reserves attributable to the Company. The primary objective of the Company's capital management is to maximise the shareholder value.
22. With effect from April, 2019, the company has adopted Ind AS 116. However, since the company has no lease liabilities at present, Ind AS 116 has no financial impact on the accounts of the company during the current financial year.
23. The physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all the units (ICC, KCC, MCP, TCP & GCP) at the end of the current year by a duly approved committee. Although, work orders were issued to independent agencies in all the units for carrying out physical stock verification of WIP and Finished Goods at the end of the financial year, due to PAN INDIA lockdown for COVID 19 pandemic the same could not be completed at KCC & ICC since the work orders are issued to out-station parties through tendering process. However, the same have been completed in TCP,GCP & MCP since work orders are awarded to local firms in the said units.
In respect of stores and spares, physical verification has been conducted by the external agencies, located in and around the project site, in all the units during the year. Shortages/ (Excesses) identified on such physical verification have been duly adjusted in the books of accounts.
24. The physical verification of fixed assets which is required to be conducted every year so that all the units/offices are covered once in a block of three years interval. During the year, physical verification of fixed assets is to be conducted by external agencies in ICC, RCP, MCP & GCP. Although, work orders were issued to independent agencies, the work is not completed due to PAN INDIA lockdown for COVID 19 pandemic in ICC & RCP unit since the work orders are issued to outstation parties. However, the same has been completed at MCP & GCP unit.
25. INFORMATION IN RESPECT OF SUBSIDIARY, ASSOCIATE & JOINT VENTURE (FORM AOC 1)(Pursuant to Section 129(3) of Companies Act 2013 read with Rule 5 of Companies (Accounts) Rules, 2014)
PART – A - SUBSIDIARYSl. No. Particulars Year ended 31.03.20201 Name of the subsidiary Chhattisgarh Copper Limited (CCL)2 Reporting period for the subsidiary concerned, if different from the
holding company’s reporting periodNA
3 Reporting currency INR4 Equity Share Capital H25,00,0005 Other equity H(28,56,096)6 Total assets H5,31,3007 Total liabilities H8,87,3968 Investments Nil
Notes to the Standalone Financial Statements (Contd...)
F-62
116
PART – B – ASSOCIATE/ JOINT VENTURESl. No. Particulars Year ended 31.03.20201 Name of the Associate/Joint Venture Khanij Bidesh India
Limited (KABIL)2 Latest audited Balance Sheet Date 31.03.20203 Date on which the Associate/Joint Venture was associated or acquired 01.08.20194 Shares of Associate/Joint Venture held by the company on the year end
Nos. 30,000Amount of investment in Associate/Joint Venture H3,00,000Extent of holding (%) 30%
5 Description of how there is significant influence Controlling 30% shareholding
6 Reason why the Associate/Joint Venture is not consolidated Not applicable7 Net Worth attributable to shareholding as per latest audited Balance Sheet H47,35,8488 Profit/(Loss) for the year H(92,13,841)
Considered in consolidation H(27,64,152)Not considered in consolidation H(64,49,689)
Note :1. KABIL is yet to commence operations.2. The associate/joint venture has neither been liquidated nor sold during the year.
Pursuant to Section 186(4) of the Companies Act, 2013, details of investment made and advance given to subsidiary & joint venture have been shown under Note No. 5 & 17 respectively. However no loan have been given to the subsidiary and joint venture during the year.
26. The income tax expense for the year can be reconciled to the accounting profit as follows :(H in lakh)
Year ended 31.03.2020
Year ended 31.03.2019
Profit / (Loss) before Tax (53771.43) 23034.64Income Tax expense calculated at 25.168% (34.944%) - 8049.22Effect of Deferred Tax balances due to the change in income tax rates 1534.21 (60.05)Income Tax effect of earlier years 842.18 472.18Others (net) 761.62 (0.33)Income Tax expense recognized in profit or loss 3138.01 8461.02
Notes to the Standalone Financial Statements (Contd...)
Sl. No. Particulars Year ended 31.03.20209 Total Income from operations (net) Nil10 Profit/(Loss) from ordinary activities before tax H(3,76,269)11 Tax expense Nil12 Profit/(Loss) from ordinary activities after tax H(3,76,269)13 Proposed Dividend Nil14 % of shareholding 74%
Note : 1. CCL is yet to commence operations. 2. The subsidiary has neither been liquidated nor sold during the year.
F-63
117
The company elected to exercise the option permitted under Section 115BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment Act, 2019). Accordingly the company has recognised Provision for Income Tax for the year ended 31.03.2020 and remeasured its deferred tax assets/(liabilities) basis the rates prescribed in the said section.
27. The value of assets, other than fixed assets and non-current assets, have realizable value at least equal to the amount at which they are stated.
28. Gujarat Copper Project of the Company consists of three units namely, Anode furnace (Smelter), Refinery and Kaldo Furnace having aggregate book value of H24536.34 lakh as at March 31,2020. The Anode Furnace and Refinery unit has been commissioned in October 2016 while Kaldo unit is commissioned on 25.05.2020. Since commissioning, the Anode Furnace and Refinery units are being operated at a sub optimal level for want of feed stock. GCP being a secondary smelter, the feed stock are copper scrap, copper blister, liberator cathode etc. The Company has not been able to source these materials in the required quantity resulting in suboptimal operations. Management is exploring various alternative source to make the plant operative.
29. Copper ore tailing (COT) beneficiation plant was set up at MCP unit for extraction of valuable minerals and metals from copper ore tails with a capacity of 10000 tonnes per day (TPD) at an estimated cost of H20000 lakh. The intermittent trial run failed on number of occasions (chockage/ spillage, stoppages, cleaning etc) and the quality and quantity of products achieved at various stages are not as per the parameters envisaged in contract agreement. A preliminary notice was issued to the party to complete the project and commission the same. The party agreed to commission the plant, but the progress of the work at site was stopped due to lockdown for COVID-19 pandemic. Under this circumstances, the company thinks it prudent to extend the timeline upto 31.08.2020 for supply, erection of the thickener and commission of the plant.
30. During the year, a Joint Venture Company (JVC) named Khanij Bidesh India Limited (KABIL) was formed on 01.08.2019 among National Aluminium Company (NALCO), Hindustan Copper Limited (HCL) and Mineral Exploration Corporation Limited (MECL) to identify, explore, acquire, develop, process primarily strategic minerals overseas for supply to India for meeting domestic requirements and for sale to any other countries for commercial use. HCL holds 30% equity in JVC. HCL has invested 30,000 equity shares of H10.00 each totaling to H3.00 lakh. Further, an advance of H72.00 lakh is lying in the books of accounts at the year end for allotment of 7,20,000 shares of H10.00 each.
31. In MCP unit, there is Mill Scat of 2379816.031 MT (estimated quantity) containing metal content of 4112.322 CMT (estimated quantity) which is generated during the milling process. The Scat quantity had been stored over the years of production and needs to be reprocessed for recovering the active metal with the involvement of secondary crushing and grinding. The expected recovery from Scat having average grade of 0.18% copper would be around 75 to 80%. Further, the scope for beneficiation of the existing Mill Scat metal through processes and treatment is not possible due to non-availability of existing matching concentrator plant. Since the Mill Scat of 2379816.031 MT (estimated quantity) (4112.322 CMT) have low grade of copper percentage and do not have any realisable value at present, the in-house team of MCP considers that it is prudent to make a provision amounting to H12010.05 lakh in the books of accounts. Also the in-house team of the unit considers that it is prudent to make a provision for lean ore of 2567.255 CMT (estimated quantity), having grade of 0.29%, amounting to H6321.75 lakh since the entire quantity of lean ore cannot be processed for production of concentrate independently without mixing with crusher ore having high grade in order to achieve the average cut-off grade. Based on all the above aspects, full provision for Mill Scat and Lean Ore amounting to H18331.80 lakh (H12010.05 lakh + H6321.75 lakh) has been made in the current year.
KCC unit have also reconciled the closing stock of Work in Progress & Finished Goods and identified the differences in respect of copper content as 323.987 CMT valuing H1126.34 lakh (considering stock valuation rate as on 31.03.2020) arising out of mismatch of copper content based on Delivery Order quantity and actual copper content as per R&D report for the period 2016-17 to 2019-20 and also identified the differences in respect of copper content as 481.262 CMT valuing H1673.11 lakh (considering stock valuation rate as on 31.03.2020) arising out of reconciliation of difference of handling losses during dispatch of copper concentrate from discharge point to bedding building for storage through loader, loss through tyres of loading equipments during dispatch and to and fro movement of trucks till the final weighment clearance for the period 2009-10 to 2019-20 which are duly checked and certified by an independent Chartered Accountant firm. Moreover, in-house team of KCC has identified that 850.000 CMT of copper concentrate valuing H2955.04 lakh (considering stock valuation rate as on 31.03.2020) is lying at the bottom of bedding building
Notes to the Standalone Financial Statements (Contd...)
F-64
118
which is mixed with floor concrete, impurities, stones etc. as well as partially oxidized and there is also heavy lump formation over a period of several years which is not suitable for pyro-metallurgical plant, making it unrealizable and hence the same is being treated as dead stock. Based on all the above aspects, 1655.249 CMT (323.987 CMT + 481.262 CMT + 850.000 CMT) valuing H5754.49 lakh (H1126.34 lakh + H1673.11 lakh + H2955.04 lakh) has been written off during the current year as one-time adjustment of closing stock.
ICC unit have also reconciled the closing stock of Work in Progress & Finished Goods and identified the differences in respect of copper content as 3837.429 CMT valuing H9953.90 lakh (considering stock valuation rate as on 31.03.2020) against receipt of copper concentrate from MCP arising out of mismatch of copper content based on provisional data of MCP and actual copper content as per analysis done at ICC for the period 2008-09 to 2019-20 and also reconciled the differences in respect of copper content as 3149.000 CMT valuing H8168.20 lakh (considering stock valuation rate as on 31.03.2020) being the difference of average metal loss considered in inventory valuation vis-à-vis actual average metal loss in Granulated Copper Dump Slag for the period 2008-09 to 2019-20 which are duly checked and certified by an independent CA firm. Moreover, in-house team of ICC has identified 706.965 CMT of copper concentrate valuing H1833.80 lakh (considering stock valuation rate as on 31.03.2020) mixed with impurities as well as partially oxidized over a period of several years, making it unrealizable and hence the same is being treated as dead stock. Based on all the above aspects, 7693.394 CMT (3837.429 CMT + 3149.000 CMT + 706.965 CMT) valuing H19955.90 lakh (H9953.90 lakh + H8168.20 lakh + H1833.80 lakh) has been written off during the current year as one-time adjustment of closing stock.
Based on all the above facts, the closing stock as on 31.03.2020 is reduced by H25710.39 lakh (H5754.49 lakh + H19955.90 lakh) due to one-time write off of closing stock of KCC & ICC respectively. Further provision amounting to H18331.80 lakh has been made against Mill Scat and Lean Ore at MCP, which are not presently in use and have no realisable value at present.
The company has modified the Standard Operating Procedure (SOP) on Inventory Management, duly verified and certified by an independent CA firm, addressing all the above issues to strengthen the reconciliation of inventory as an ongoing activity.
32. Consequent upon the Judgment of Common Cause dated 02.08.2017, which is applicable only to the mining leases of iron and manganese ore, passed by the Apex court in the case of Common Cause Vs UOI and others, a demand of H4353.78 lakh was raised by the District Mining Officer of Jamshedpur for running the Surda mine without valid environment clearance (EC) although Surda mine has a valid mining lease, forest clearance and it has adhered to the terms of approved mining plan and it was working on valid Consent to Operate. Based on the Revision Application filed by the company, the Revisional Authority of the Ministry of Mines, after hearing at length both parties had issued specific direction against the District Mining Officer (DMO) not to take any coercive measures in terms of recovery of the said demand. On revision of demand from H4353.78 lakh to H12690.49 lakh by the office of the District Mining Officer and subsequently revised to H92940.06 lakh by the State Government, the company again appealed before the Revisional Authority and hearing was held on 14.11.2019 and interim stay is granted by the Revisional Authority till the next date of hearing. Since at present mining leases of copper ore are not included under Common Cause Judgement, the Management, based on the legal opinion, is of the view that the same has not to be shown as Contingent Liability as on 31.03.2020.
33. The spread of Covid 19 has affected the business operations of the company in all the units due to lock down declared by the Government. The company has taken various measures in consonance with the Government advisories to contain the pandemic, which included closing of mining and operational activities across the company. However, Government has allowed to resume its operation in all the units during April 2020 & May 2020.
Given the uncertainty of quick turnaround to normalcy, post lifting of the closure, the company has carried out a comprehensive assessment of possible impact on its business operations, financial assets, contractual obligations and its overall liquidity position, based on the internal and external sources of information and application of reasonable estimates. Management will continue to monitor any material changes arising due to the impact of this pandemic on financial and operational performance of the company and take necessary measures to address the situation.
34. The previous year’s figures have been regrouped / rearranged, wherever necessary.
Notes to the Standalone Financial Statements (Contd...)
F-65
119
Not
e N
o. 3
9 : G
EN
ER
AL
NO
TES
ON
AC
CO
UN
TSA
ddit
iona
l inf
orm
atio
n fo
rmin
g pa
rt o
f acc
ount
s fo
r ye
ar e
nded
Mar
ch 3
1, 2
020
39.1
Cap
acit
ies,
pro
duct
ion,
sto
cks
and
sale
s(F
igur
es in
bra
cket
s pe
rtai
n to
thos
e of
pre
viou
s ye
ar)
Cla
ss o
f goo
dsU
nit
Lice
nsed
ca
paci
tyIn
stal
led
capa
city
(As
cert
ified
by
man
agem
ent)
Act
ual
prod
ucti
onO
peni
ng S
tock
Clo
sing
Sto
ckSa
les
Issu
ed fo
r in
tern
al
cons
umpt
ion/
inte
rmed
iate
P
rodu
cts
and
othe
rs
Qua
ntit
y
Qua
ntit
yV
alue
Qua
ntit
yV
alue
Qua
ntit
yV
alue
J in
lakh
J in
lakh
J in
lakh
Man
ufac
turi
ng A
ctiv
ities
a : M
ain
prod
ucts
1. W
ire
bar *
MT
3940
0 39
400
--
--
--
--
(394
00)
(394
00)
(-)(-)
(-)(-)
(-)(-)
(-)(-)
2. W
ire
rod
MT
6000
0 60
000
4108
16
0 65
3.63
21
83
.00
4247
18
989.
96
-
(600
00)
(600
00)
(138
66)
(51)
(226
.02)
(160
)(6
53.6
3)(1
3756
)(6
3861
.13)
(-)
3. C
atho
de in
clud
ing
MT
9950
0 68
500*
*53
40
290
1206
.61
2 7.
06
1492
66
08.0
9 41
37
T
oll S
mel
ted
Cath
ode
(995
00)
(685
00)
(162
15)
(440
)(1
648.
41)
(290
)(1
206.
61)
(256
4)(1
1870
.82)
(138
01)
4. M
etal
in C
once
ntra
teCM
T26
502
1678
6 39
933.
39
1034
0 33
292.
12
1266
9 50
824.
96
2027
9
(324
39)
(208
50)
(478
59.2
8)(1
6786
)(3
9933
.39)
(219
53)
(910
87.8
0)(1
4549
)
b : B
y pr
oduc
ts
1. G
old
KG
264
698
--
--
--
--
(264
)(6
98)
(-)(-)
(-)(-)
(-)(-)
(-)(-)
2. S
ilver
KG
4763
98
68
--
--
--
--
(476
3)(9
868)
(-)(-)
(-)(-)
(-)(-)
(-)(-)
3. N
icke
l sul
phat
eM
T25
0 39
0 -
--
--
--
-
(250
)(3
90)
(-)(-)
(-)(-)
(-)(-)
(-)(-)
4. S
elen
ium
KG
1000
0 14
600
--
--
--
--
(100
00)
(146
00)
(-)(-)
(-)(-)
(-)(-)
(-)(-)
5. S
ulph
uric
aci
dM
T23
6000
23
6000
59
43
1266
98
.36
976
59.2
0 55
14
294.
52
718
(236
000)
(236
000)
(154
45)
(169
6)(8
2.16
)(1
266)
(98.
36)
(144
14)
(912
.36)
(146
1)
c : A
llied
and
sem
i- Fi
nish
ed
prod
ucts
1. A
node
slim
eM
T N
A -
5 25
13
93.8
6 5
610.
34
25
1996
.80
-
(NA)
(-)
(48)
(6)
(289
.27)
(25)
(139
3.86
)(2
9)(3
291.
45)
(-)
2. C
oppe
r mou
ldM
T N
A -
- -
- -
- -
- -
(NA)
(-)
(-)(-)
(-)(-)
(-)(-)
(-)(-)
Notes to the Standalone Financial Statements (Contd...)
F-66
120
Notes to the Standalone Financial Statements (Contd...)(F
igur
es in
bra
cket
s pe
rtai
n to
thos
e of
pre
viou
s ye
ar)
Cla
ss o
f goo
dsU
nit
Lice
nsed
ca
paci
tyIn
stal
led
capa
city
(As
cert
ified
by
man
agem
ent)
Act
ual
prod
ucti
onO
peni
ng S
tock
Clo
sing
Sto
ckSa
les
Issu
ed fo
r in
tern
al
cons
umpt
ion/
inte
rmed
iate
P
rodu
cts
and
othe
rs
Qua
ntit
y
Qua
ntit
yV
alue
Qua
ntit
yV
alue
Qua
ntit
yV
alue
J in
lakh
J in
lakh
J in
lakh
3. K
yani
teM
T N
A -
--
--
--
--
(NA)
(-)
(-)(-)
(-)(-)
(-)(-)
(-)(-)
4. O
ther
sM
T N
A -
--
1602
.32
****
*
(NA)
(-)
(-)(-)
(432
0.29
)
d : W
ork
in p
rogr
ess
i) M
etal
in O
re31
131
5762
88
42.3
2 40
080
5901
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- -
(318
7)
(358
81)
(654
1)(7
209.
48)
(576
2)(8
842.
32)
- -
(366
61)
ii) O
ther
WIP
7297
.28
***
2458
5.60
***
*
(164
47.5
7)(7
297.
28)
GR
AN
D T
OTA
L59
425.
45
6453
9.03
80
316.
65
(737
62.1
9)(5
9425
.45)
(175
343.
85)
Not
e :
* D
ue to
chan
ge in
pro
duct
dem
and,
the
Com
pany
is n
o lo
nger
mak
ing
this
pro
duct
.**
Alth
ough
the
Inst
alle
d Ca
paci
ty o
f Cat
hode
is s
how
n as
995
00 M
T (K
CC -
3100
0 M
T &
ICC
- 185
00 M
T, G
CP -
5000
0 M
T), d
ue to
eco
nom
ic co
nsid
erat
ion
the
Com
pany
sus
pend
ed K
CC
Sm
elte
r & R
efine
ry fr
om D
ecem
ber 2
008.
Cop
per
Sulp
hate
Rev
erts
Libe
rato
r/
Ele
ctro
wn
Cat
hode
Mag
neti
c/
Red
/Cop
per
Jam
Ano
de S
lag
Ano
de in
flo
or/A
node
in
cel
l
Scra
pO
ther
sT
otal
***
Ope
ning
Wor
k in
pro
gres
s in
clud
esCu
rren
t yea
r10
.58
611.
25 -
70.7
11.
3133
48.5
969
2.23
2562
.62
7297
.28
Prev
ious
yea
r17
8.97
2076
.64
9.35
4.93
1743
.48
2577
.63
1304
.64
8551
.93
1644
7.57
****
Clo
sing
Wor
k in
pro
gres
s in
clud
esCu
rren
t yea
r10
.63
642.
17 -
11.6
40.
8587
2.09
229.
9122
818.
3124
585.
60Pr
evio
us y
ear
10.5
861
1.25
- 70
.71
1.31
3348
.59
692.
2325
62.6
272
97.2
8
****
*Oth
er S
ales
val
ue
incl
udes
C
oppe
r Su
lpha
teR
ever
tsLi
bera
tor/
E
lect
row
n C
atho
de
Mag
neti
c/
Red
/Cop
per
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Ano
de S
lag
Gra
nula
ted
Slag
Cop
per
Dus
tC
oppe
r A
sh/
Res
idue
Oth
ers
TO
TA
L
Curr
ent y
ear
217.
7081
5.98
22.3
2 -
0.06
401.
217.
5669
.54
67.9
516
02.3
2Pr
evio
us Y
ear
717.
0420
27.1
095
.54
30.3
58.
2234
6.95
139.
25 7
8.89
87
6.95
4320
.29
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Notes to the Standalone Financial Statements (Contd...)
39.2 Raw materials consumed
Quantity ValueYear ended 2019-2020
Year ended 2018-2019
Year ended 2019-2020
Year ended 2018-2019
CMT CMT (J in lakh) (J in lakh)Concentrate own production 5948 14549 16060.14 33438.35 Concentrate excluding own production - - - -Cathode - - - -
39.3 Imported and indigenous raw materials, stores spare parts and components consumed (as certified by the management)RAW MATERIALS: % %Imported 95 92 461.39 5741.43 Indigenous 5 8 21.90 528.14
100.00 100.00 483.29 6269.57 STORES & SPARES:(Direct and Stores & Spares booked in Mine Development, Shut-down and Fuel)Imported 1 4 157.95 882.50Indigenous 99 96 16298.30 20448.64
100.00 100.00 16456.25 21331.14
39.4 C.I.F. value of importsRaw Material 461.39 5741.43Components, spare parts and stores 226.60 1444.00
687.99 7185.43
39.5 Expenditure in foreign currencyTravelling 67.84 85.64Others 753.39 7185.52
821.23 7271.16
39.6 Earning in foreign ExchangeExport of Goods (FOB) 46129.33 84267.33
46129.33 84267.33
39.7 Payment to Whole Time DirectorsSalaries and allowances 153.84 186.11Company's contribution to provident and other funds 13.18 13.99Re-imbursement of Medical expenses 1.06 0.53Leave Encashment 32.83 13.23Gratuity 20.00 10.00Other Benefits 29.68 26.21
250.59 250.07
Note :
In addition, the Whole Time Directors are allowed the use of company car for private purpose and have been provided with residential accommodation as per terms of their appointment/Government guidelines
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Independent Auditor’s Report
ToThe Members of Hindustan Copper Limited
Report on the Audit of the Consolidated Financial Statements
OpinionWe have audited the accompanying Consolidated Financial Statements of Hindustan Copper Limited (hereinafter referred to as the “Holding company”) and its one subsidiary company (Holding and its subsidiary together referred to as “the Group”) and its one jointly controlled entity, which comprise the Consolidated Balance Sheet as at March 31, 2020, the consolidated Statement of Profit and Loss (including Other Comprehensive Income), the consolidated Statement of Changes in Equity and the consolidated Statement of Cash Flows for the year ended on that date, and notes to the Consolidated Financial Statements including a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “the Consolidated Financial Statements”).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Consolidated Financial Statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the consolidated state of affairs of the Group and its jointly controlled entity as at March 31, 2020, and its consolidated loss (including Other Comprehensive loss), consolidated changes in equity and its consolidated cash flows for the year ended on that date.
Basis for OpinionWe conducted our audit of the Consolidated Financial Statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group and its jointly controlled entity in accordance with the ethical requirements that are relevant to our audit of the Consolidated Financial Statements in India in terms of the Code of Ethics issued by Institute of chartered Accountants of India and the relevant provisions of the Companies Act, 2013, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained and audit evidence obtained by other auditors in terms of their report as referred in “Other Matters” paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the Consolidated Financial Statements.
Emphasis of MattersWe draw attention to the following matters:
a) Note No. 39 (1) “Contingent liabilities” of the accompanying Consolidated Financial Statements which describes the uncertainty related to the outcome of the lawsuits filed and demands raised against the Group and its jointly controlled entity by various parties and Government authorities;
b) Note No. 39 (6) of the accompanying Consolidated Financial Statements which states the title deeds for freehold and leasehold land and building acquired in respect of Gujarat Copper Project (GCP) of Holding company with book value of H5578.11 Lakh (PY:- H5859.97 Lakh) are yet to be executed in favor of the Holding company. Title deeds for other leasehold and freehold lands available with the Holding company or other evidences of title are pending to be reconciled with the financial records at Holding company.
c) Note No. 39 (8) of the accompanying Consolidated Financial Statements wherein, balances under the head Claims Recoverable, Loans & Advances, Deposits with various parties and certain balances of receivables, payables and other current liabilities at Holding company have not been confirmed as at March 31, 2020.Consequential impact upon receipt of such confirmation/reconciliation/adjustments of such balances, if any is not ascertainable at this stage;
d) Note No. 39 (29) the accompanying Consolidated Financial Statements regarding Gujarat Copper project at Holding company valuing H24536.34 Lakh (PY:- H27214.50 Lakh) has not been able to operate profitably due to various constraint, viability assessment needs to be done to evaluate and adjust for possible impairment loss, if any.
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Independent Auditor’s Report (Contd...)
e) Note No.39 (32) which states that Closing stock as at 31st March, 2020 at Holding company has been reduced aggregately by H25710.39 Lakh due to one-time adjustment through write-off in value of closing stock arising as a result of, reconciliation of metal content in copper concentrate on inter-unit transfer and sales, assessment of metal loss in generation of granulated Dump Slag, handling losses and old & oxidized concentrate. Further low grade Lean Ore and Mill Scat not presently in use in manufacturing process, for which provision of H18331.80 Lakh has been made in the books of accounts as at March 31, 2020 by the Holding company’s management. As mentioned in the referred note, the Holding company has modified its Standard Operating Procedure on Inventory Management to strengthen the reconciliation of inventory as an ongoing activity and identification and segregation of unused stock for better control; and
f) Note No.39 (34) which describes the uncertainties and the assessment of possible impact of COVID-19 pandemic on its Group’s business operations, financial assets, contractual obligations and its overall liquidity position as at March 31, 2020 by the Group and its jointly controlled entity. The Group’s management will continue to monitor in future any material changes arising on financial and operational performance of the Group and its jointly controlled entity due to the impact of this pandemic and necessary measure to address the situation.
Our opinion is not modified in respect of these matters.
Key Audit MattersKey audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Consolidated Financial Statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.Sl. No. Key Audit Matters Auditor’s Response1. Assessment of Stripping Ratio and charging of
overburden expenditure during production stage of surface mines to Mines Development Expenditure and Profit and Loss account
Referred in Note No.2 (11) and Note No.9 of the Consolidated Financial Statements.
Assessment of Stripping Ratio is technically estimated initially at the beginning of the Mines and later on periodically assessed for which no standards written policy are there. Normally review done within a period of 3 to 4 years as informed to us.
In case of open cast mines, the expenditure on removal of waste and overburden, is capitalized and the same is depleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodically based on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines.
Assessment of Stripping Ratio is uniquely applied under the Mining industries which involves significant judgment to determine the ratio and that also keep on change from time to time. This ratio has been changed subsequently based on the actual output of overburden and Ore exposed during the production stage of the mines.
We have identified this area as key audit matter due to its nature as industry specific and involvement of technical assumptions and judgments in calculation of stripping ratio. Further it has a material impact on the financial statements being this year the Group has amortized H23904.06 Lakh (PY:-20074.56 Lakh) as Mine development expenditure in respect of open cast mines at Holding company.
Principal Audit Procedures
Our audit approach consisted testing of the design and operating effectiveness of the internal controls and substantive testing as follows:
• We went through the current status of the mining at different mines
• We discussed with the management about the stripping procedure adopted in the industry as well practice followed by the Company
• Procedure followed by the management towards Identification of expenditures incurred in surface mines during production stage
• Understanding the computation of Stripping ratio initially made and documents made available to us.
• We have checked the stripping ratio to be charged under amortization for mine development expenditure for balance period of mines
• Discussion with the core technical team involve in this process
• Reliance is placed on the representations of the management.
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Independent Auditor’s Report (Contd...)
2. Modified Audit Procedures carried out in light of COVID-19 outbreak:
Due to COVID-19 pandemic, Nation-wide lockdown and travel restrictions imposed by Central / State Government / Local Authorities during the period of our audit wherever physical access was not possible, audit could not be conducted by visiting the Plants/Projects/Regional Sales offices. As we could not gather audit evidence in person/ physically/ through discussions and personal interactions with the officials at the Plants/Projects/Regional Sales offices, we have identified such modified audit procedures as a Key Audit Matter. Accordingly, our audit procedures were modified to carry out the audit remotely.
Principal Audit Procedures
Due to the outbreak of COVID-19 pandemic that caused nationwide lockdown and other travel restrictions imposed by the Central and State Governments/local administration during the period of our audit, we could not travel to the Plants/Projects/Regional Sales offices and carry out the audit processes physically at the respective Plants/Projects/Regional Sales offices. Wherever physical access was not possible, necessary records/ reports/ documents/ certificates were made available to us by the management of the respective Plants /Projects / Regional Sales offices through E-Mail and to the extent generated from the ORACLE system at Head office, Kolkata. To this extent, the audit process was carried out on the basis of such documents, reports and records made available to us on which were relied upon as audit evidence for conducting the audit and reporting for the current period.
Accordingly, we modified our audit procedures as follows:
a) Conducted verification of necessary records/ documents/Trial Balances and other relevant application software electronically through remote access/emails in respect of Plants/Projects/Regional Sales offices wherever physical access was not possible.
b) Carried out verification of scanned copies of the documents, records, certificates, deeds etc. made available to us through emails and remote access over secure network of the Company.
c) Making enquiries and gathering necessary audit evidence through telephonic communication and e-mails.
Information Other than the Consolidated Financial Statements and Auditor’s Report ThereonThe Holding company’s Board of Directors is responsible for the other information. The other information comprises the information included in the Report of the Board of Directors, Management Discussion and Analysis Report, Report on CSR activities, Business Responsibility Report, Corporate Governance Report and other annexure to Directors Report including Shareholder’s Information, but does not include the Consolidated Financial Statements and our auditor’s report thereon. The Report of the Board of Directors including annexures and other related statements forming part of the Company’s annual report is expected to be made available to us after the date of this audit report.
Our opinion on the Consolidated Financial Statements does not cover the other information and we do not express any form of assurance conclusion thereon.
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In connection with our audit of the Consolidated Financial Statements, our responsibility is to read the other information when it becomes available only and, in doing so, consider whether the other information is materially inconsistent with the Consolidated Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information; we are required to report that fact.
When we read the Report of the Board of Directors including annexures and other related statements form part of the annual report and made available to us after the date of this audit report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.
Responsibility of Management and Those Charged with Governance for the Consolidated Financial StatementsThe Holding Company’s Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013 (“The Act”) with respect to the preparation of these Consolidated Financial Statements that give a true and fair view of the consolidated financial position, consolidated financial performance, changes in equity and consolidated cash flows of the Group and its jointly controlled entity in accordance with the accounting principles generally accepted in India, including the accounting Standards specified under Section 133 of the Act. The respective Board of Directors of the companies included in the Group and its Jointly controlled entity are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and its Jointly controlled entity and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Consolidated Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of the preparation of the Consolidated Financial Statements by the Directors of the Holding company, as aforesaid..
In preparing the Consolidated Financial Statements, the respective Board of Directors of the companies included in the Group and its jointly controlled entity are responsible for assessing the ability of the Group and its Jointly controlled entity to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group and its jointly controlled entity or to cease operations, or has no realistic alternative but to do so.
The respective Board of Directors of the companies included in the Group and its jointly controlled entity is also responsible for overseeing the financial reporting process of the Group and its jointly controlled entity.
Auditor’s Responsibilities for the Audit of the Consolidated Financial StatementsOur objectives are to obtain reasonable assurance about whether the Consolidated Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Consolidated Financial Statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Group to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the companies within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the audit of the financial statements of the companies included in the consolidated financial statements of which we are the Independent auditors. For the other companies included in the consolidated financial statements, which have been audited by the other auditors, such other auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion.
Materiality is the magnitude of misstatements in the Consolidated Financial Statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the Consolidated Financial Statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the Consolidated Financial Statements.
We communicate with those charged with governance of the Holding company regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Independent Auditor’s Report (Contd...)
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Other MattersWe did not audit the financial statements / financial information of one Subsidiary company and one jointly controlled entity, whose financial statements / financial information reflect total assets of H5.31 Lakh as at March 31, 2020, Group’s share of total revenue of HNil for the period from 1st April 2019 to 31st March, 2020 and net cash out flows amounting to H4.96 lakh for the year ended on that date, as considered in the Consolidated Financial Statements. These financial statements / financial information of subsidiary company and jointly controlled entity have been audited by other auditors whose reports have been furnished to us by the Holding company’s management and our opinion on the Consolidated Financial Statements, in so far as it relates to the amounts and disclosures included in respect of these subsidiary company and jointly controlled entity, and our report in terms of sub-sections (3) and (11) of Section 143 of the Act, in so far as it relates to the aforesaid subsidiary company and jointly controlled entity, is based solely on the reports of the other auditors.
Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements1) The Companies (Auditor’s Report) Order, 2016 (“the Order”), issued by the Central Government of India in terms of
sub-section (11) of section 143 of the Companies Act, 2013 is not applicable to the Consolidated Financial Statements as referred in Proviso to Para 2 of the said Order.
2) As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid Consolidated Financial Statements except as reported in Clause (b) & (c) of the “Emphasis of Matters” paragraph above;
b) In our opinion, proper books of account as required by law relating to the preparation of the aforesaid Consolidated Financial Statements have been kept so far as it appears from our examination of those books and reports of the other auditors.
c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss including Other Comprehensive Income, Consolidated Statement of Changes in Equity and the Consolidated Cash Flow Statement dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of preparation of the Consolidated Financial Statements.
d) In our opinion, the aforesaid Consolidated Financial Statements comply with the Ind AS specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2015 as amended;
e) In pursuance to the Notification No. G.S.R 463(E) dated 05-06-2015 issued by the Ministry of Corporate affairs, Section 164(2) of the Companies Act, 2013 pertaining to disqualification of Directors, is not applicable to the Government Companies.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Group and its jointly controlled entity the operating effectiveness of such controls, refer to our separate Report in “Annexure-A”;
g) As per Notification No. GSR 463(E) dated 05-06-2015 issued by the Ministry of Corporate Affairs, Government of India, Section 197 of the Act is not applicable to the Government Companies. Accordingly, reporting in accordance with requirement of provisions of Section 197(16) of the Act is not applicable.
h) With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Consolidated Financial Statements disclose the impact of pending litigations on its consolidated financial position of the Group and its jointly controlled entity.–[Refer Note No.39 (1) to the accompanying Consolidated Financial Statements];
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ii. The Group and its jointly controlled entity did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;
iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund at the Holding company. While there were no amount, required to be transferred, to the Investor Education and Protection Fund by the subsidiary company and jointly controlled entity as reported by respective auditors of those companies within the Group.
3) As required by Section 143(5) of the Act, we give in the “Annexure-B”, a statement on the matters specified in the Directions issued by the Comptroller and Auditor General of India in respect of the Group and its jointly controlled entity. This statement has been prepared incorporating the comments of the Auditors’ of the subsidiary company and jointly controlled entity as reported.
For Chaturvedi & Co. Chartered Accountants (Firm’s Registration No.302137E)
Place: Kolkata CA R.K. NandaDate: July 21, 2020 Partner (Membership No.510574)
UDIN: 20510574AAAABI8371
Independent Auditor’s Report (Contd...)
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Annexure - A to the Independent Auditor's Report (Contd...)
{Referred to in paragraph 2(f) under ‘Report on Other Legal and Regulatory Requirements’ section of our Independent Auditor’s Report to the Members of Hindustan Copper Limited}Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)
In conjunction with our audit of the Consolidated Financial Statements of the Group and its jointly controlled entity as of and for the year ended March 31, 2020, we have audited the internal financial controls over financial reporting of Hindustan Copper Limited (hereinafter referred as “the Holding company”) as of March 31, 2020 and considered the report of auditor of the subsidiary company and its jointly controlled entity as of that date.
Management’s Responsibility for Internal Financial ControlsThe respective Board of Directors of the Holding company, subsidiary company and its jointly controlled entity are responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Group and its jointly controlled entity 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. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to respective company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.
Auditor’s ResponsibilityOur responsibility is to express an opinion on the internal financial controls over financial reporting of the Group and its jointly controlled entity based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained and audit evidence obtain by the Other auditors in terms of their reports referred to in the “Other Matters” paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the Group’s internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial ReportingA company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial ReportingBecause of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are
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subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
OpinionIn our opinion, to the best of our information and according to the explanations given to us, the Group has, in all material respects, internal financial controls system over financial reporting and such internal financial controls over financial reporting were generally operating effectively as at March 31, 2020, based on the internal control over financial reporting criteria established by the Group and its jointly controlled entity 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. However as reported in Audit report of Holding company in certain areas where design documentation need further improvement like Manual on Fixed Assets verification, Implementation of Centralized data base for Title deeds/lease deeds/ other evidences of titles in respect of both freehold and leasehold lands and Buildings, Fund Management including Cash and Bank and controls over issuance of Bank Guarantees shown as contingent liabilities, Comprehensive delegation of power, adequate departmental work allocation process, job rotation policy etc., Inventory Management, Receivable Management, Expenditure on CSR, Payable Management incorporating the process flow by which the transactions are initiated, authorized, processed, recorded and reported at department level at Plants/Projects as well as for financial reporting process. Modification of finance/accounts manual at Holding company needs to be done incorporating the Indian Accounting Standards requirements to have effective internal controls over financial reporting. System integration to capture the transactions that relates to financial statements and events/conditions and other transactions significant to the financial statement has to be designed properly so as to fulfill the objectives of control criteria established by the Holding company.
Internal controls over financial reporting process as well as testing of such control activities at Holding company has to be further improved considering the discrepancies noticed in physical verification of fixed assets like non availability of prescribed format of reporting, reconciliation of mismatches out of such physical verification, timely adjustment of discrepancies noticed, team structure etc. and maintenance of Fixed Asset Register to be further improved. Identification of old account balances and action taken to settle/adjust the account balances after due assessments and reconciliation of account balances has to be carried out periodically. Utilization certificate related to funds disbursed at Holding company under CSR programme have not been received in proper format explaining the date wise disbursements by company, various mode of spending the amount within a project, details of agency involved with their name, amount paid etc for better control. Further various control activities in Inventory management at Holding company have to be established looking into the size of the Company and nature of its business especially like non-availability of defined formats of reporting upon completion of physical verification, fixing any tolerance limit for stock adjustment, Quantification of process stock and assessment of its quality, delay identification of unused stock lying on floor and its segregation process, Improper monitoring and recording of standard and actual average metal loss during manufacturing process, handling losses during the dispatch of copper concentrate from discharge point to bedding building for storage and reconciliation of metal content in copper concentrate on inter-unit transfer and sales. As reported, the Holding company has modified its Standard Operating Procedure on Inventory Management to strengthen the reconciliation of differences arise in physical verification process as an ongoing activity and identification and segregation of unused stock for better control. However, our opinion is not qualified in the above respect.
Other MattersOur aforesaid report under Section 143(3)(i) of the Act, on the adequacy and operating effectiveness of the internal financial controls over financial reporting, is so far as it relates to the one subsidiary company and its jointly controlled entity, is based on the corresponding report of the auditors of such companies, companies incorporated in India.
For Chaturvedi & Co. Chartered Accountants (Firm’s Registration No.302137E)
Place: Kolkata CA R.K. NandaDate: July 21, 2020 Partner (Membership No.510574)
UDIN: 20510574AAAABI8371
Annexure - A to the Independent Auditor's Report (Contd...)
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Annexure B” to the Independent Auditor’s Report
(Referred to in Paragraph 3 under ‘Report on Other Legal and Regulatory Requirements’ section of our Independent Auditor’s Report to the Members of Hindustan Copper Limited)
Sl. No.
Details/Directions Auditors’ Reply Action Taken and Impact on Accounts and Financial
statements1. Whether the company has system in
place to process all the accounting transactions through IT System? If yes, the implications of processing of accounting transactions outside IT system on the integrity of the accounts along with financial implications, if any may be stated.
Yes, the Group and its jointly controlled entity has system in place to process all the accounting transactions through IT System.
There is no impact on the accounts and Consolidated Financial Statements.
2. Whether there is any restructuring of any existing loan or cases of wavier/write off of debts/loans/interest etc. made by a lender to the company due to the company’s inability to repay the loan? If yes, the financial impact may be stated.
Based on the information available to us, there is no restructuring of any existing loan or cases of wavier/write off of debts/loans/interest etc. made by a lender to the company during FY: 2019-20. However, the Holding company has written back aggregate amount of H2280.83 Lakh towards trade liabilities pending since long and excess provisions made in accounts during the normal course of business, as stated under Note No. 39 (11) of the Consolidated Financial Statements.
Impact on the accounts and financial statements to the tune of H1453.37 Lakh has already been considered.
Amount of H827.46 Lakh towards provision against feasibility study of Concentrator Plant at MCP of Holding company has been written back and equivalent amount of Capital work in progress has also charged to revenue resulting Nil impact in the accounts of the Holding company as well as in Consolidated Financial Statements.
3. Whether funds received/receivable for specific schemes from Central/State agencies were properly accounted for / utilized as per its term and conditions? List the cases of deviation.
No funds received/receivable for specific schemes from Central/State agencies during FY 2019-20.
There is no impact on the accounts and Consolidated Financial Statements.
For Chaturvedi & Co. Chartered Accountants (Firm’s Registration No.302137E)
Place: Kolkata CA R.K. NandaDate: July 21, 2020 Partner (Membership No.510574)
UDIN: 20510574AAAABI8371
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COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION 143(6)(b) READ WITH SECTION 129(4) OF THE COMPANIES ACT, 2013 ON THE CONSOLIDATED FINANCIAL STATEMENTS OF HINDUSTAN COPPER LIMITED FOR THE YEAR ENDED 31 MARCH 2020
The preparation of consolidated financial statements of Hindustan Copper Limited for the year ended 31 March 2020 in accordance with the financial reporting framework prescribed under the Companies Act, 2013 (Act) is the responsibility of the management of the company. The statutory auditor appointed by the Comptroller and Auditor General of India under Section 139(5) read with section 129(4) of the Act is responsible for expressing opinion on these financial statements under section 143 read with section 129(4) of the Act based on independent audit in accordance with the standards on auditing prescribed under section 143(10) of the Act. This is stated to have been done by them vide their Audit Report dated 21 July 2020.
I, on behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit of the consolidated financial statements of Hindustan Copper Limited for the year ended 31 March 2020 under Section 143(6)(a) read with section 129(4) of the Act. We conducted a supplementary audit of the financial statements of Hindustan Copper Limited and its subsidiary company Chhattisgarh Copper Limited for the year ended on that date. This supplementary audit has been carried out independently without access to the working papers of the statutory auditors and is limited primarily to inquiries of the statutory auditors and company personnel and a selective examination of some of the accounting records.
On the basis of my supplementary audit nothing significant has come to my knowledge which would give rise to any comment upon or supplement to statutory auditors’ report under Section 143(6)(b) of the Act .
For and on the behalf of the Comptroller & Auditor General of India
(Suparna Deb)Place : Kolkata Director General Audit (Mines)Date : 03 September 2020 Kolkata
F-80
134
Consolidated Balance Sheet as at 31st March 2020
PARTICULARS Note No. As at 31st March, 2020
As at 31st March, 2019
ASSETS(1) NON-CURRENT ASSETS(a) Property, Plant and Equipment 3A & 3B 29427.52 31653.72(b) Capital Work In Progress 4 123177.57 102211.31(c) Financial Assets
(i) Investments 5 3.00 - (ii) Others 6 26.36 12.47
(d) Deferred Tax Assets (Net) 7 5290.81 6831.36(e) Non-Current Tax Assets (Net) 8 689.82 620.33(f) Other Non-Current Assets 9 49269.28 53268.78(2) CURRENT ASSETS(a) Inventories 10 51982.72 64366.77(b) Financial Assets
(i) Investments 11 9.48 8.85(ii) Trade receivables 12 8289.35 36154.83(iii) Cash and cash equivalents 13 1134.86 663.53(iv) Bank Balances other than above 14 452.52 424.19(v) Others 15 2686.41 3279.93
(c) Current Tax Assets (Net) 16 1845.39 - (d) Other current assets 17 37491.49 32103.30
Total Assets 311776.58 331599.37EQUITY AND LIABILITIES
(1) Equity(a) Equity Share Capital 18 46260.90 46260.90(b) Other Equity 19 49734.19 117417.99
Attributable to Non Controlling Interest (a) Equity Share Capital 6.50 6.50(b) Other Equity (6.45) (6.45)Liabilities
1 NON-CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 20 63617.53 57065.73(ii) Other financial liabilities 21 843.53 843.53
(b) Provisions 22 6565.93 5471.59(2) CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 23 92749.96 49945.20(ii) Trade Payables 24 23374.42 20229.08(iii) Other financial liabilities 25 8582.21 7600.37
(b) Other current liabilities 26 16984.81 18883.94(c) Provisions 27 3063.04 6297.03(d) Current Tax Liabilities (Net) 28 - 1583.96
Total Equity & Liabilities 311776.58 331599.37Corporate Information 1 Significant Accounting Policies 2 General Notes on Accounts 39 The notes referred to above form an integral part of the Financial Statements.
(H in lakh)
In terms of our report of even date attached. For and on behalf of the Board of Directors
For Chaturvedi & Co. C. S. Singhi Sukhen Kumar Bandyopadhyay Arun Kumar ShuklaChartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEOFRN 302137E (M No. FCS 2570) (DIN : 08173882) (DIN : 03324672)
CA R K NANDAPartner(M No. 510574)
Place : KolkataDated : 21st July, 2020
F-81
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Consolidated Statement of Profit and Loss for the year Ended 31st March 2020
(H in lakh except EPS)
Particulars Note No.
For the year ended 31st March, 2020
For the year ended 31st March, 2019
INCOMEI Revenue from Operations 29 83185.25 181625.72II Other Income 30 5696.22 3665.87III Total Income (I+II) 88881.47 185291.59IV EXPENSES
Cost of Materials Consumed 31 628.24 6493.41Changes in Inventories of Finished Goods,Semi-Finished and Work-In-Process 32 (5113.58) 14336.74Employees Benefit Expense 33 25962.31 31651.48Finance Cost 34 6041.89 5546.10Depreciation and Amortisation Expense 35 28862.06 25289.40General,Administration & Other Expenses 36 86257.39 78964.61Total Expenses (IV) 142638.31 162281.74
V PROFIT /(LOSS) BEFORE EXCEPTIONAL ITEMS AND TAX (III-IV) (53756.84) 23009.85VI Exceptional items - - VII PROFIT /(LOSS) BEFORE TAX (V-VI) (53756.84) 23009.85VIII TAX EXPENSE 37
1) Current Tax 842.18 9128.932) Deferred Tax 2295.83 (667.91)IX PROFIT /(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS
AFTER TAX (VII-VIII) (56894.85) 14548.83
IX(A) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Owners (IX-IX(B))
(56894.85) 14555.28
IX(B) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Non Controlling Interest
- (6.45)
X Profit/(Loss) from discontinued operations (34.70) (34.70)XI Tax expense of discontinued operations (8.73) (12.13)XII PROFIT/(LOSS) FROM DISCONTINUED OPERATIONS AFTER TAX (X -XI) (25.97) (22.57)XIII PROFIT /(LOSS) FOR THE PERIOD AFTER TAX (IX+XII) (56920.82) 14526.26XIV Share of Profit/(Loss) of Joint venture/ Associate (27.64) - XV NET PROFIT /(LOSS) FOR THE PERIOD AFTER TAX & SHARE OF
PROFIT/(LOSS) OF JV/ASSOCIATE (XIII+XIV)(56948.46) 14526.26
XV(A) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Owners (XV-XV(B))
(56948.46) 14532.71
XV(B) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Non Controlling Interest
- (6.45)
XVI OTHER COMPREHENSIVE INCOME /(LOSS) 38 A(i) Items that will not be reclassified to Profit / (Loss) (3000.95) (1676.21)A(ii) Income Tax relating to items that will not be reclassified to Profit / Loss 755.28 585.74 B(i) Items that will be reclassified to Profit / (Loss) - - B(ii) Income Tax relating to items that will be reclassified to Profit/ (Loss) - - XVII TOTAL COMPREHENSIVE INCOME /(LOSS) FOR THE PERIOD (XIII+XIV)
(Comprising Profit/(Loss) and Other Comprehensive Income for the period)
(59194.13) 13435.79
XVIII Earning per equity share (for continuing operations)1 BASIC (H) (6.152) 1.5732 DILUTED (H) (6.152) 1.573
XIX Earning per equity share (for discontinued operations)1 BASIC (H) (0.003) (0.002)2 DILUTED (H) (0.003) (0.002)
XX Earning per equity share (for discontinued & continuing operations)1 BASIC (H) (6.155) 1.5712 DILUTED (H) (6.155) 1.571
Corporate Information 1 Significant Accounting Policies 2General Notes on Accounts 39 The notes referred to above form an integral part of the Financial Statements.
In terms of our report of even date attached. For and on behalf of the Board of Directors
For Chaturvedi & Co. C. S. Singhi Sukhen Kumar Bandyopadhyay Arun Kumar ShuklaChartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEOFRN 302137E (M No. FCS 2570) (DIN : 08173882) (DIN : 03324672)
CA R K NANDAPartner(M No. 510574)
Place : KolkataDated : 21st July, 2020
F-82
136
Stat
emen
t of C
hang
es in
Equ
ity
A .
Equ
ity
Shar
e C
apit
al(H
in la
kh)
Bala
nce
at th
e be
ginn
ing
of th
e re
port
ing
peri
od 0
1.04
.201
8Ch
ange
s in
equ
ity s
hare
capi
tal d
urin
g th
e ye
arBa
lanc
e at
the
end
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e re
port
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peri
od 3
1.03
.201
946
260.
90 -
4626
0.90
B. O
ther
Equ
ity(H
in la
kh)
Par
ticu
lars
Gen
eral
R
eser
veC
apit
al
Res
erve
Cor
pora
te S
ocia
l R
espo
nsib
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R
eser
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losu
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s
Cur
renc
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uctu
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eser
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l
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port
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1.04
.201
989
65.9
721
166.
24 -
163.
0015
5.94
8696
0.39
1174
11.5
4 D
ivid
ends
& D
ivid
end
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- -
- (5
800.
08)
(580
0.08
)Pr
ofit f
or th
e Ye
ar A
fter T
ax -
Atri
buta
ble
to O
wne
rs -
- -
(569
48.4
6)(5
6948
.46)
Profi
t for
the
Year
Afte
r Tax
- At
ribu
tabl
e to
Non
Co
ntro
lling
Inte
rest
-
-
Oth
er C
ompr
ehen
sive
Inco
me
(net
of t
ax)
(224
5.67
)(2
245.
67)
Amou
t add
ition
dur
ing
the
year
- 7
5.00
(2
764.
59)
(268
9.59
)Am
out u
sed
duri
ng th
e ye
ar -
- -
- -
- Ba
lanc
e at
the
end
of th
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port
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peri
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1.03
.202
089
65.9
721
166.
24
- 2
38.0
0 (2
608.
65)
2196
6.18
4972
7.74
A .
Equ
ity
Shar
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9Ch
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arBa
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d 31
.03.
2020
4626
0.90
- 46
260.
90
B. O
ther
Equ
ity
(H in
lakh
)P
arti
cula
rsG
ener
al
Res
erve
Cap
ital
R
eser
veC
orpo
rate
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ial
Res
pons
ibili
ty
Res
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Min
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losu
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s
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ion
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-
- 76
313.
1010
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Div
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ds &
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x -
- -
(278
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Profi
t for
the
Year
Afte
r Tax
- At
ribu
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Ow
ners
- -
- -
- 14
532.
71
1453
2.71
Pr
ofit f
or th
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ar A
fter T
ax -
Atri
buta
ble
to N
on C
ontr
ollin
g In
tere
st
(6.4
5)(6
.45)
Oth
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ompr
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me
(net
of t
ax)
(109
0.47
)(1
090.
47)
Amou
t add
ition
dur
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year
163
.00
155
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- 31
8.94
Am
out u
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ar -
- (2
2.78
) -
- (2
2.78
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lanc
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end
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port
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peri
od 3
1.03
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989
65.9
721
166.
24 -
163.
0015
5.94
8696
0.39
1174
11.5
4
In te
rms
of o
ur re
port
of e
ven
date
att
ache
d.
For a
nd o
n be
half
of th
e Bo
ard
of D
irec
tors
For
Cha
turv
edi &
Co.
C. S
. Sin
ghi
Sukh
en K
umar
Ban
dyop
adhy
ay
Aru
n K
umar
Shu
kla
Char
tere
d Ac
coun
tant
s Co
mpa
ny S
ecre
tary
D
irec
tor (
Fina
nce)
& C
FO
Chai
rman
and
Man
agin
g D
irec
tor &
CEO
FRN
302
137E
(M
No.
FCS
257
0)
(DIN
: 08
1738
82)
(DIN
: 03
3246
72)
CA
R K
NA
ND
APa
rtne
r(M
No.
510
574)
Plac
e : K
olka
taD
ated
: 21
st J
uly,
202
0
Consolidated Statement of Changes in Equity for the year Ended 31st March 2020
F-83
137
Consolidated Cash Flow Statement for the year Ended 31st March 2020
(H in lakh)
For the year ended 31st March 2020
For the year ended 31st March 2019
A. CASH FLOW FROM OPERATING ACTIVITIES : NET PROFIT/ (LOSS) BEFORE TAX AS PER PROFIT AND
LOSS ACCOUNT(53756.84) 23009.85
Adjusted for :Depreciation 3590.33 3662.30Provisions charged 18866.24 1900.97Provisions written back (2280.83) (1095.29)Interest expense 6041.89 5546.10Amortisation 25271.73 21627.10Interest income (1021.90) (334.49)Loss / (Profit) on disposal of fixed assets 2.04 (48.24)Share of Profit / (Loss) in Joint Venture (27.64) -
OPERATING PROFIT/ (LOSS) BEFORE WORKING CAPITAL CHANGES
(3314.98) 54268.30
Adjusted for :Decrease/ (Increase) in Trade & other Receivables 27921.74 (28004.35)Decrease/ (Increase) in Inventories (5682.60) 14412.96 Decrease/ (Increase) in Current & Non-Current assets (3781.12) (7008.79)Increase/ (Decrease) in Current & Non-Current Liabilities (2121.72) (2833.18)
CASH GENERATED FROM OPERATIONS 13021.32 30834.94Tax Refund received - 1106.54 Taxes paid (4423.72) (6730.75)
NET CASH FROM OPERATING ACTIVITIES (A) 8597.60 25210.73B. CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of Fixed Assets (22094.87) (40039.91)Sale of Fixed Assets 12.03 80.07 Interest received 1015.68 415.71 Advance for / (Recovery of advance) for Capital expenditure - 260.68 Investment in Joint Venture (3.00) - Mine Development Expenditure (B) (21913.69) (19369.43)
NET CASH USED IN INVESTING ACTIVITIES (42983.85) (58652.88)C. CASH FLOW FROM FINANCING ACTIVITIES
Non-Current borrowings / (Loan repaid) 15895.20 52669.68 Dividends paid (4811.14) (2313.05)Tax on Dividend (988.94) (475.45)Interest paid (5895.91) (5422.90)Increase in Other Equity (C) - 6.50
NET CASH USED IN FINANCING ACTIVITIES 4199.21 44464.78NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) (30187.04) 11022.63CASH AND CASH EQUIVALENTS - opening balance (38113.46) (49136.09)CASH AND CASH EQUIVALENTS - closing balance (68300.50) (38113.46)(details in Annexure - A)
In terms of our report of even date attached. For and on behalf of the Board of Directors
For Chaturvedi & Co. C. S. Singhi Sukhen Kumar Bandyopadhyay Arun Kumar ShuklaChartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEOFRN 302137E (M No. FCS 2570) (DIN : 08173882) (DIN : 03324672)
CA R K NANDAPartner(M No. 510574)
Place : KolkataDated : 21st July, 2020
F-84
138
(H in lakh)1. CASH AND CASH EQUIVALENTS - opening balance 01/04/2019 01/04/2018
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 663.53 879.67ii) Current Financial Assets - Bank Balance other that above (Note 14) 408.33 379.16
(Excluding Unpaid Dividend of H15.86 Lakh)
iii) Current Financial Assets - Investments (Note 11) 8.85 8.18iv) Non-current Financial Assets - Others (Note 6) 12.47 1.44v) Current Financial Liabilities - Borrowings (Note 23) (39206.64) (50404.54)
(38113.46) (49136.09)
CASH AND CASH EQUIVALENTS - closing balance 31/03/2020 31/03/2019i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 1134.86 663.53ii) Current Financial Assets - Bank Balance other that above (Note 14) 432.21 408.33
(Excluding Unpaid Dividend of H20.31 Lakh)
iii) Current Financial Assets - Investments (Note 11) 9.48 8.85iv) Non-current Financial Assets - Others (Note 6) 26.36 12.47v) Current Financial Liabilities - Borrowings (Note 23) (69903.41) (39206.64)
(68300.50) (38113.46)
Consolidated Cash Flow Statement for the year Ended 31st March 2020 (Contd...)
ANNEXURE - A
2. The Cash Flow Statement has been prepared as set out in Indian Accounting Standard (IND AS) 7 : STATEMENT OF CASH FLOWS, as amended by Companies (Indian Accounting Standards) (Amendment) Rules 2016.
This is the Cash Flow Statement referred to in our report of even date attached.
F-85
139
Notes to Consolidated Financial Statements
1. Corporate Information Hindustan Copper Limited, established in 1967 and domiciled in India is a Central public sector undertaking under
the administrative control of Ministry of Mines, Government of India. The registered office of the Company is situated at Kolkata. The principal activities of the Company are exploration, exploitation, mining of copper and copper ore including beneficiation of minerals, smelting and refining. The Company has copper mines & concentrator plants in Malanjkhand Copper Project at Madhya Pradesh (MCP), Khetri Copper Complex at Rajasthan (KCC) and Indian Copper Complex, Ghatsila at Jharkhand (ICC). The Company is operating Smelter & Refinery in ICC and Gujarat Copper Project, Gujarat (GCP) for production of copper cathode. Further, cathode is converted into copper wire rod at Copper wire rod plant at Taloja Copper Project, Taloja, Maharashtra (TCP). The Company is listed with BSE Ltd. and National Stock Exchange of India Ltd.
Chhattisgarh Copper Limited (CCL), established on 21.05.2018 and domiciled in India, is a Joint Venture Company (JVC) formed between Hindustan Copper Limited (HCL) and Chhattisgarh Mineral Development Corporation (CMDC) for exploration, mining and beneficiation of copper and its associated minerals in the State of Chhattisgarh. Since HCL holds 74% equity in JVC, it is also a Subsidiary of HCL as per Section 2(87) of the Companies Act, 2013.
2. Significant Accounting Policies
2.1 Basis of Accounting The financial statements are prepared under historical cost convention from the books of accounts maintained
under accrual basis except for certain financial instruments which are measured at fair value and in accordance with the Indian Accounting Standards prescribed under Companies Act, 2013.
2.2 Basis of consolidation2.2.1 Subsidiaries
Subsidiaries are all entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date when control ceases.
The acquisition method of accounting is used to account for business combinations by the Company.
The Company combines the financial statements of the parent and its subsidiaries line by line adding together like items of assets, liabilities, equity, cash flows, income and expenses, Intercompany transactions, balances and unrealized gains on transactions between companies are eliminated.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of profit and loss, consolidated statement of changes in equity and balance sheet respectively.
2.2.2 Joint Ventures Joint Ventures are those joint arrangements whereby the Company is having rights to the net assets of the arrangements.
Interests in joint ventures are accounted for using the equity method, after initially being recognised at cost.
2.2.3 Equity method Under the equity method of accounting, the investments are initially recognized at cost and adjusted thereafter
to recognize the Company’s share of post-acquisition profit or losses of the investee in profit and loss, and the Company’s share of Other Comprehensive Income of the investee in the Other Comprehensive Income.
2.3 Application of Indian Accounting Standards (Ind-AS) The Group adopted Indian Accounting Standards (Ind AS) from April 1,2016 and accordingly the financial
statements have been prepared in accordance with the recognition and measurement principles as notified by MCA under the Companies (Indian Accounting Standards) Rules, 2015 (“Ind AS Rules”), as amended and other relevant provisions of the Companies Act, 2013.
The Group has complied all the Ind AS as applicable and relevant to the Group.
2.4 Use of Estimates The preparation of the Group’s financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying F-86
140
Notes to Consolidated Financial Statements (Contd...)
disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Revision to accounting estimates are recognised in the period on which the estimates are revised and, if material their effects are disclosed on the notes to the financial statements.
2.5 Current and Non-current Classification The Group presents assets and liabilities in the Balance sheet based on current/non-current classification. An asset
are treated as current by the Group when:
a) its expects to realize the asset, or intends to sell or consume it in its normal operating cycle;b) it holds the assets primarily for the purpose of trading;c) it expects to realize the asset within twelve months after the reporting date; ord) the asset is cash or cash equivalent (as defined under Ind AS 7) unless the asset is restricted from being
exchanged or used to settle a liability for at least twelve months after the reporting period.Except the above, all other assets are classified as Non-current.
A liability is treated as current by the Group when:
a) its expects to settle the liability realize the asset, or intends to sell or consume it in its normal operating cycle;b) it expects to settle the liability in its normal operating cycle; c) it holds the liability primarily for the purpose of trading; d) the liability is due to be settled within twelve months after the reporting period; or e) it does not have an unconditional right to defer settlement of the liability for at least twelve months after the
reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
Except the above, all other liabilities are classified as non-current.
2.6 Revenue Recognition Revenue is measured at the fair value of the consideration received or receivable and fair value has been defined
taking into account contractually defined terms of payment. Operating revenue recognized is net of all promotional expenses and discounts, rebates and/or any other incentive to customers.
Sale of ProductsAn entity shall account for a sale contract with a customer only when all of the following criteria are met:(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customary
business practices) and are committed to perform their respective obligations;(b) the entity can identify each party’s rights regarding the goods to be transferred;(c) the entity can identify the payment terms for the goods to be transferred;(d) the contract has commercial substance i.e the risk, ownership, timing or amount of the entity’s future cash
flows etc is expected to change as a result of the contract; and(e) it is probable that the entity will collect the consideration to which it will be entitled in exchange for the goods
that will be transferred to the customer.
In case of sale of Copper Concentrate, Copper Reverts, Anode Slime etc. and tolling of Copper Concentrate of Khetri and Malanjkhand origin, sales / tolling at the end of the accounting period are recorded on provisional basis as per standard parameters for want of actual specifications and differential sales value are recorded only on receipt of actual. This is as per consistent practice followed by the Group.
Sale of Services Income from conversion of job work is accounted for on the basis of actual quantity dispatched. When the outcome of
a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shall be recognized by reference to the stage of completion (Percentage of Completion Method) of the transaction at the end of the reporting period.
Advances received from the customers are reported as customer’s deposits unless the above conditions for revenue recognition are met.
F-87
141
Notes to Consolidated Financial Statements (Contd...)
Other Operating Revenuesa. Sale of Scrap Sale of Scrap is accounted for on delivery of material.
b. Interest from Customers In case of credit sales, interest up to the date of Balance Sheet on all outstanding bills is accounted for on
accrual basis.
c. Interest from Contractors against mobilisation advance for mining operations Interest up to the date of Balance Sheet on all mobilisation advances for mining operations is accounted for on
accrual basis.
d. Penalty and Liquidated Damages Penalty and liquidated damages are accounted for as and when these are realised by the company as per
contract terms.
Other Incomea. Claims Claims are recognized in the Statement of Profit & Loss (Net of any payable) including receivables from
Government towards subsidy, cash incentives, reimbursement of losses, etc, when there is certainty of realisation of such claim and that can be measured reliably.
b. Dividend and Interest from Investments Dividend income from Investments is recognised in the Statement of Profit and Loss when the right to receive
the dividend has been established and it is certain that the economic benefits will flow to the Group and the amount of income can be measured reliably.
Interest Income from a financial asset is recognised using Effective Interest Method. When it is probable that the economic benefits will flow to the Group and the amount of income can be measured reliably.
c. Profit on Sale of Investment Profit on sale of investment is recognised upon transfer of title by the Group and is determined as the difference
between the sales price and the then carrying value of the investment.
d. Provisions not required written back Provisions/Liabilities created from business activities in earlier years no longer required are accounted for.
e. Others Any other income is recognised on accrual basis.
2.7 Employees Benefit Retirement benefit costs and termination benefits
Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest), is reflected immediately in the statement of financial position with a charge or credit recognized in other comprehensive income in the period in which they occur. Re-measurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to Statement of Profit or Loss. Past service cost is recognized in Statement of Profit or Loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:
i. Service cost (including current service cost, past service cost, etc.);ii. Net interest expense or income; andiii. Re-measurement.
The Group presents the first two components of defined benefit costs in profit or loss in the line item ‘employee benefits expense’.
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The retirement benefit obligation recognized in the statement of financial position represents the actual deficit or surplus in the Group defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.
A liability for a termination benefit is recognized at the earlier of when the Group can no longer withdraw the offer of the termination benefit and when the Group recognises any related restructuring costs.
Short-term and other long-term employee benefits A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick
leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.
Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the Group in respect of services provided by employees up to the reporting date.
Deficit in Provident Fund Deficit, if any, in the accounts of Provident Fund Trust ascertained on the basis of last audited accounts of the Trust
is accounted for as a charge to Revenue.
2.8 Borrowing Cost Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily
takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest expenses calculated using the effective interest method and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs
2.9 Taxation Income tax expense represents the sum of current tax and deferred tax.
Current tax The current tax payable is based on taxable profit for the year as determined from net profit before tax as represented
in Statement of Profit and Loss and Other Comprehensive Income, in line with different provisions under Income Tax Act 1961.Current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in
the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
Current and Deferred Tax for the year Current and deferred tax are recognized in Statement of Profit or Loss, except when they relate to items that are
recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity respectively.
Notes to Consolidated Financial Statements (Contd...)
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2.10(a) Property Plant and Equipments (PPE) The cost of an item of PPE is recognized as an asset if and only if, it is probable that future economic benefits
associated with the item will flow to the Group and the cost of the item can be measured reliably. The cost of an item of PPE is the cash price equivalent at the recognition date. The cost of an item of PPE comprises:
i. Purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates.
ii. Costs directly attributable to bringing the PPE to the location and condition necessary for it to be capable of operating in the manner intended by management.
iii. The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which the Group incurs either when the PPE is acquired or as a consequence of having used the PPE during a particular period for purposes other than to produce inventories during that period.
The Group has chosen the cost model of recognition and this model is applied to an entire class of PPE. After recognition as an asset, an item of PPE is carried at its cost less any accumulated depreciation and any accumulated impairment losses.
Pending reconciliation/receipt of the final bills against capital items, capitalization is done on the basis of cost booked and depreciation is charged accordingly. Price differences, if any, are adjusted in the year of finalization of bills.
In respect of expenditure during construction/development of a new unit/project in a new location, all direct capital expenditure as well as all indirect expenditure incidentals to construction are capitalized allocating to various items of PPE on an appropriate basis. Expansion programme involving construction concurrently run with normal production activities in an existing unit, all direct capital expenditure in relation to such expansion are capitalized but indirect expenditure are charged to revenue. Borrowing costs that are attributable to the acquisition or construction of qualifying asset are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.
Expenses incurred for implementation of new projects are carried forward against respective projects till execution. Expenses rendered in fructuous projects abandoned subsequently are provided for in the Statement of Profit & Loss.
Physical verification of PPE is conducted every year so that all the units/offices are covered once in a block of three years interval. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification.
Depreciation and Amortization The Group has used the exemption available in Ind AS 101 with respect to recognition of Plant, Property and
Equipment (PPE) and Intangible Assets at their carrying value being deemed cost.
The depreciable amount of an item of PPE is allocated on a straight line basis over its useful life prescribed in Part C of Schedule II of the Companies Act,2013 or actual useful life of assets assessed by the Technical Committee of the Group, whichever is lower. The residual value and the useful life of an asset are reviewed, at each financial year-end. Each part of an item of PPE with a cost that is significant in relation to the total cost of the item is depreciated separately. Depreciation on all such items have been provided from the date they are ‘Put to Use’ till the date of sale and includes amortization of intangible assets and lease hold assets. Freehold land is not depreciated. The residual value of all such items is taken at 5% of the original cost of individual asset.
An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Certain consumable items of small value whose useful life is very limited are directly charged to revenue in the year of purchase.
From the date Ind AS came into effect, the carrying amount of an asset is depreciated over the remaining useful life of the asset as per estimate of remaining useful life. Wherever, the remaining useful life of an asset is nil, the carrying amount is recognized in the opening balance of retained earnings after retaining the residual value.
2.10(b) Intangible Assets Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets
acquired in a business combination is their fair value at the date of acquisition. Following initial recognition,
Notes to Consolidated Financial Statements (Contd...)
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intangible assets are carried at cost less any accumulated amortisation (calculated on a straight-line basis over their useful lives) and accumulated impairment losses, if any.
Internally generated intangibles, excluding capitalised development costs, are not capitalised. Instead, the related expenditure is recognised in the statement of profit and loss and other comprehensive income in the period in which the expenditure is incurred. An internally generated intangible asset arising from development is recognized if all the conditions stipulated in “Ind AS 38-Intangible Asset” are met. The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.
An intangible asset with an indefinite useful life is not amortised but is tested for impairment at each reporting date and its useful life is reviewed in each reporting period to determine whether events and circumstances continue to support an indefinite useful life estimate.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss.
Intangible Assets other than Software are amortized over estimated useful life which is equivalent to license period, generally not more than 5 years.
Cost of Software recognized as intangible asset, is amortised on straight line method over a period of legal right to use with a nil residual value. Otherwise the cost of software will be charged in the year of incurrence.
2.11 Capital Work in Progress Assets in the course of construction are included under capital work –in-progress and are carried at cost, less
any recognized impairment loss. Such capital work-in-progress, on completion, is transferred to the appropriate category of property, plant and equipment.
2.12(a) Mine Development Expenditure In case of underground mines : The expenditure on development of a new mine in all cases and on subsequent
development of a working mine is capitalized and depleted on the basis of ore raised during the year and the mineable ore reserves estimated from time to time.
In case of working mines, where development activities are going on simultaneously: Expenses are apportioned between capital and revenue on the basis of in-house technical estimates.
In respect of open cast mines : The expenditure on removal of waste and overburden, is capitalized and the same is depleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodically based on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines. Subsequently, If any ore is reclaimed from overburden, the same is included in inventory at a value based on opening rate of mine development expenditure with a corresponding credit in Mine development expenditure.
Expenditure incurred on development of new deposits are capital in nature and is included in mine development expenditure. If subsequently the development activities are found to be not viable, the expenditure on such development work included in mine development expenditure is written off in the year in which it is decided to abandon the project.
If a working mine is closed due to economic reasons, the un-depleted value of Mine Development Expenditure related to that mine is provided in the books of accounts in the year in which it is decided to close or suspend operation of the mine. If later on, the closed / suspended mines are re-opened and the Group remains the owner of the mines, the unamortized Mine Development Expenditure which was fully provided in the year of closure will be written back in the books of accounts in the year of re-opening and the Group will be depleting it year wise based on the estimated remaining life of that mine.
2.12(b) Mineral Exploration and Evaluation Expenditures 2.12(b)(i) Pre-exploration costs
Pre-exploration costs are expensed in the period in which they are incurred.
Notes to Consolidated Financial Statements (Contd...)
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2.12(b) (ii) Exploration and Evaluation Assets (E & E Assets) Once the legal right to explore a property has been acquired, costs directly related to exploration and evaluation
expenditures are recognized and capitalized, in addition to the acquisition costs. These direct expenditures include such costs as acquisition of rights to explore, materials used, topographical, geological, geochemical and geophysical evaluation, surveying costs, sampling, drilling costs, activities in relation to evaluation of technical feasibility and commercial viability of extracting a mineral resource, consultancy cost, payments made to contractors etc. during the exploration phase. Costs not directly attributable to exploration and evaluation activities are expensed in the period in which they occur.
Administrative and general overhead cost that are directly attributable to the assets are capitalized as E & E Assets.
E & E Assets may be tangible or intangible. To the extent that a tangible asset is consumed in developing an intangible asset, the amount reflecting that consumption may be part of the cost of the intangible asset created. However, the asset being used remains a tangible asset.
When a project is deemed to no longer have commercially viable prospects for the Group, exploration and evaluation expenditures in respect of that project are deemed to be impaired. As a result, those exploration and evaluation expenditure costs, in excess of estimated recoveries, are written off to Statement of Profit &Loss.
The Group assesses exploration and evaluation assets for impairment when facts and circumstances suggest that the carrying amount of an asset may exceed its recoverable amount.
Once the technical feasibility and commercial viability of extracting the mineral resource has been determined, the property is considered to be a mine under development and is classified as “mines under construction”.
Exploration and evaluation Assets are also tested for impairment before the assets are transferred to development properties.
As the Group currently has not commenced commercial operations, any incidental revenues, including receipt of input tax credit receivables, earned in connection with exploration activities are applied as a reduction to capitalized exploration costs.
An impairment loss is reversed if there is an indication that there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had been recognized.
2.13 Overhauling Expenses Revenue expenditure attributable to overhaul of smelter and/ or refinery is charged off to the Statement of Profit
& Loss in the year of incurrence.
2.14 Mine Closure Expenditure & Decommissioning/Site restoration liability Financial implications towards final mine closure plans under relevant Acts and Rules are technically estimated
and Mine Closure Reserve is created based on the estimated life of the mines over the period by charging the same to Statement of Profit and Loss.
2.15 Non-Current Assets Held for Sale The Group classifies a non-current asset (or disposal group of assets) as held for sale if its carrying amount
will be recovered principally through a sale transaction rather than through continuing use. Immediately before the initial classification of the asset (or disposal group) as held for sale, the carrying amounts of the asset (or all the assets and liabilities in the group) are to be measured in accordance with applicable Indian Accounting Standards. The sale should be expected to qualify for recognition as a completed sale within one year from the date of classification except as permitted by Ind AS 105.
2.16 Inventories Stocks of stores and spare parts, loose tools and materials-in-transit are valued at the lower of the net realizable
value and cost. The raw materials are also valued at the lower of the net realizable value and weighted average cost to the unit if the finished goods in which they will be incorporated are expected to be sold below cost. Loose tools when issued are charged off to revenue.
Notes to Consolidated Financial Statements (Contd...)
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Finished goods and work-in-process are valued at the lower of the net realizable value and weighted average cost to the unit. The cost is exclusive of financing cost, such as, interest, bank charges, administration overhead, etc. Ore is valued at cost since its realisable value cannot be ascertained. The value of slag under work-in-process is taken at equivalent value to the extent credited to the process, where the said products have been generated. The reverts under work- in-process are valued at lower of cost (equivalent value of concentrate) and net realizable value.
The stock of anode slime arising from treatment and refining processes are stated at realizable value based on the year end London Metal Exchange price for gold and silver after making due adjustments of their physical recovery and the treatment and refining charges.
The inventories out of inter-unit transfers (material in transit) at the close of the year are valued and accounted in the books of the transferor unit on the basis of cost plus transportation to the transferee unit or net realisable value whichever is lower.
Imported materials are valued at the lower of the net realizable value and weighted average cost. In the event where final price is not determined valuation is made on provisional cost. Variations are accounted for in the year of finalization.
Provision is made in the accounts every year, for non-moving stores and spares (other than insurance spares) which have not moved for more than five years. Insurance spares are fully provided for on the expiry of the life of the relevant Property Plant and Equipments.
Physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all the units at reasonable intervals during the year by a duly approved committee. Also, physical stock verification of WIP and Finished Goods is undertaken by a duly approved committee at the end of every financial year alongwith an independent agency once in a block of three years. In respect of Stores and Spares, physical verification is carried out by external agencies once in every year covering all the units. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification
2.17 Government Grants All government grants are recognized as deferred income and it will be taken to Statement of Profit and Loss over
the period of time in accordance with the pattern in which the obligations are met.
2.18 Impairment of Assets (Other than Financial Assets) The Group assesses at the end of each reporting period whether there is any indication that an asset may be
impaired. If any such indication exists, the Group estimates the recoverable amount of the asset. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in Statement of Profit and Loss, unless the relevant asset is carried at a revalue amount, in which case the impairment loss is treated as a revaluation decrease.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
2.19 Foreign Exchange Transactions Transactions in currencies other than the Group’s functional currency (foreign currencies) are recognized at the
rates of exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are re-translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Notes to Consolidated Financial Statements (Contd...)
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Foreign currency monetary items (except overdue recoverable where realizability is uncertain) are converted using the closing rate as defined in the Ind AS-21- The effects of changes in Foreign Exchange Rates. Non-monetary items are reported using the exchange rate at the date of the transaction. The exchange difference gain/loss is recognized in the Statement of Profit and Loss.
In case of long term foreign currency monetary items outstanding as of 31st March 2016, liability in foreign currency loans relating to acquisition of fixed assets is converted using the closing rate as defined in Ind AS 21-The effects of changes in Foreign Exchange Rates and the difference in exchange is recognized in terms of exemptions given in paragraph D13AA of Appendix D to Ind AS-101, where the effect of exchange differences on foreign currency loans of the Group is accounted for by addition or deduction to the cost of the assets so far it relates to the depreciable capital assets and shall be depreciated over the balance life of the assets.
Other long term foreign currency monetary items are accumulated in ‘Equity Component of Foreign Currency asset/liability Account’ and amortized over the balance period of the asset/liability by recognition as income or expense in each of such periods as stated under Para 29A of Ind As 21.
2.20 Provisions, Contingent Liabilities & Contingent Assets Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past
event and it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
Wherever no reliable estimate could be made, a disclosure is made as contingent liability. A disclosure for a contingent liability is also made when there is a possible obligation or a present obligation that may but probably will not require an outflow of resources.
When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.
Contingent Liabilities are disclosed in the General Notes forming part of the accounts.
Contingent Assets are not recognised in the financial statements but are disclosed in Notes to the Accounts. Such assets occur when the inflow of economic benefits is probable. Such contingent assets are assessed continuously, if it’s virtually certain that inflow of economic benefits will arise then such assets and the relative income will be recognised in the financial statements.
2.21 Leasing Assets held under lease, in which a significant portion of the risks and rewards of ownership are transferred to
lessee are classified as finance leases. All other leases are classified as operating leases.
Depreciation expenses are recorded if asset held under finance lease is depreciable.
Finance expenses are recognized immediately in the statement of profit and loss if they are not directly attributable to qualifying assets, otherwise they are capitalised in accordance with the Group’s general policy on borrowing costs.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term.
2.22 Financial Instruments Non Derivative Financial Instruments
(i) Initial Recognition Financial assets and financial liabilities are recognized when the Group becomes a party to the contractual
provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.
Notes to Consolidated Financial Statements (Contd...)
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(ii) Subsequent Recognition a. Financial assets
Financial assets are subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss.
b. Financial Liabilities Financial liabilities are subsequently measured at amortized cost using Effective Interest Rate (EIR)
method except for derivatives, which are measured at fair value.
Derivative Financial Instruments All derivatives are recognized and measured at fair value with changes in fair value being recognized in profit or
loss for the period.
Impairment of financial assets At each reporting date, assessment is made whether the credit risk on a financial instrument has increased
significantly or not since initial recognition.
If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance is measured for that financial instrument at an amount equal to 12 month expected credit losses. If the credit risk on that financial instrument has increased significantly since initial recognition, the loss allowance is measured for a financial instrument at an amount equal to the lifetime expected credit losses.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date is recognised as an impairment gain or loss in the statement of profit and loss.
2.23 Events Occurring after the Reporting Period The Group adjusts the amount recognized in its financial statements to reflect adjusting material events after
the reporting period and does not adjust the amount to reflect non-adjusting events after the reporting period. However where retrospective restatement is not practicable for a particular prior period then the circumstances that lead to the existence of that condition and the description of how and from where the error is corrected are disclosed in Notes on Accounts.
2.24 Dividends Final dividend on shares are recorded as a liability on the date of approval by the shareholders in general meeting
and interim dividends are recorded as a liability on the date of declaration by the directors in the meeting of the Board of Directors.
2.25 Cash and Cash Equivalents Cash and cash equivalent in the Balance Sheet comprise cash at bank and on hand and short term deposit with
an original maturity of three months or less which are subject to insignificant risk of changes in value.
2.26 Rounding of amounts Amounts in these financial statements have, unless otherwise indicated, have been rounded off to ‘Rupees in lakh’
upto two decimal points.
Notes to Consolidated Financial Statements (Contd...)
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Notes to Consolidated Financial Statements (Contd...)N
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Net
Car
ryin
g A
mou
nt a
s at
31.
03.2
019
2446
.58
4686
.15
2066
1.90
21
8.01
10
4.34
83
9.00
19
5.85
20
99.6
5 40
2.24
31
653.
72
Gro
ss C
arry
ing
Am
ount
Gro
ss C
arry
ing
Amou
nt a
s at
01.
04.2
019
2446
.58
6728
.85
2658
8.06
32
3.47
16
8.24
18
26.3
9 29
3.86
28
78.2
2 44
4.21
41
697.
88
Add
ition
s -
14.
47
1,6
26.1
8 8
4.29
5
7.73
-
- 4
1.52
-
1,8
24.1
9 In
ter-
head
Tra
nsfe
r In
/(Out
) -
- -
- -
- -
- -
- Tr
ansf
er F
rom
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- Tr
ansf
er T
o D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
Dis
posa
ls -
- (1
3.59
) (0
.01)
(0.4
5) -
- (0
.02)
- (1
4.07
)Im
pair
men
t Los
ses
Prov
. Trf
to D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
Adju
stm
ents
- -
0.5
8 (0
.01)
- 0
.01
- (0
.01)
- 0
.57
Gro
ss C
arry
ing
Am
ount
as
at 3
1.03
.202
024
46.5
8 67
43.3
2 28
201.
23
407.
74
225.
52
1826
.40
293.
86
2919
.71
444.
21
4350
8.57
A
ccum
ulat
ed D
epre
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ion
& I
mpa
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Accu
mul
ated
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reci
atio
n as
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9 -
2042
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5926
.16
105.
46
63.9
0 98
7.39
98
.01
778.
57
41.9
7 10
044.
16
Dep
reci
atio
n ch
arge
dur
ing
the
year
- 52
2.27
28
46.0
5 44
.36
29.
44
325
.17
32.
67
222
.95
13.
99
4036
.90
Inte
r-he
ad T
rans
fer I
n /(O
ut)
- -
- -
- -
- -
- -
Tran
sfer
Fro
m D
isca
rded
Ass
ets
- -
- -
- -
- -
- -
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sfer
To
Dis
card
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sset
s -
- -
- -
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- -
- Im
pair
men
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- -
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posa
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- -
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- -
- -
- A
ccum
ulat
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epre
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Im
pair
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.202
0 -
2564
.97
8772
.21
149.
82
93.3
4 13
12.5
6 13
0.68
10
01.5
2 55
.96
1408
1.06
N
et C
arry
ing
Am
ount
as
at 3
1.03
.202
024
46.5
8 41
78.3
5 19
429.
02
257.
93
132.
18
513.
84
163.
18
1918
.19
388.
25
2942
7.52
Not
e : H
CL h
as u
sed
the
exem
ptio
n av
aila
ble
in In
d AS
101
with
res
pect
to r
ecog
nitio
n of
Pro
pert
y, P
lant
, Equ
ipm
ents
(PPE
) and
Inta
ngib
le A
sset
s at
thei
r car
ryin
g va
lue.
F-96
150
Not
e : 3
(B) P
rope
rty,
Plan
t and
Equ
ipm
ent (
Dis
card
ed A
sset
s)(H
in la
kh)
DE
SCR
IPTI
ON
Free
Hol
d &
Lea
se
Hol
d La
nd
Bui
ldin
gs
incl
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g Sa
nita
ry
and
Wat
er S
uppl
y Sy
stem
Pla
nt,
Mac
hine
ry
and
Min
ing
Equ
ipm
ent
Furn
itur
e &
Fix
ture
s &
Offi
ce
Equ
ipm
ent
Veh
icle
sR
oads
, B
ridg
es
and
Cul
vert
s
Rai
lway
Si
ding
Ele
ctri
cal
Equ
ipm
ent
and
Inst
alla
tion
Shaf
ts
and
Incl
ines
Tota
l
Gro
ss C
arry
ing
Am
ount
Gro
ss C
arry
ing
Am
ount
as
at 0
1.04
.201
83.
64
181.
45
372.
93
6.26
4.
03
24.9
3 -
58.1
7 91
.70
743
.11
Add
ition
s -
- -
- -
- -
- -
- In
ter-
head
Tra
nsfe
r In
/(Out
) -
- -
- -
- -
- -
- Tr
ansf
er F
rom
Act
ive
Ass
ets
- 0
.46
1,0
39.1
6 3
3.30
1
9.26
-
- 4
.11
0.6
0 1
,096
.89
Tran
sfer
To
Act
ive
Asse
ts -
- (0
.60)
- (0
.20)
- -
- -
(0.8
0)D
ispo
sals
- -
(0.6
4) -
- -
- -
- (0
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Impa
irm
ent L
osse
s -
- (4
64.0
1) -
- -
- -
- (4
64.0
1)Ad
just
men
ts -
- -
- -
- -
- -
- G
ross
Car
ryin
g A
mou
nt a
s at
31.
03.2
019
3.64
18
1.91
94
6.84
39
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9 24
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0.00
62
.28
92.3
0 13
74.5
5 A
ccum
ulat
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epre
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& I
mpa
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Accu
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ated
Dep
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n as
at 0
1.04
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8 -
- -
- -
- -
- -
- D
epre
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char
ge d
urin
g th
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ar -
- -
- -
- -
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- In
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Tra
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r In
/(Out
) -
- -
- -
- -
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- Tr
ansf
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Dis
card
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o D
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Ass
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s -
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- -
- -
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Acc
umul
ated
Dep
reci
aton
& I
mpa
irm
ent a
s at
31.
03.2
019
- -
- -
- -
- -
- -
Net
Car
ryin
g A
mou
nt a
s at
31.
03.2
019
3.64
18
1.91
94
6.84
39
.56
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9 24
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- 62
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92.3
0 13
74.5
5 Le
ss P
rovi
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s fo
r D
isca
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Ass
ets
1374
.55
Net
Car
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mou
nt (N
et o
f Pro
visi
ons)
as
at 3
1.03
.201
9 -
Gro
ss C
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Am
ount
Gro
ss C
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Amou
nt a
s at
01.
04.2
019
3.64
18
1.91
94
6.84
39
.56
23.0
9 24
.93
- 62
.28
92.3
0 13
74.5
5A
dditi
ons
- -
- -
- -
- -
- -
Inte
r-he
ad T
rans
fer I
n /(O
ut)
- -
- -
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- -
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Tran
sfer
Fro
m A
ctiv
e A
sset
s -
- -
- -
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ansf
er T
o A
ctiv
e As
sets
- -
- -
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- -
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posa
ls -
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- Im
pair
men
t Los
ses
- -
- -
- -
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Adj
ustm
ents
- -
- -
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- -
Gro
ss C
arry
ing
Am
ount
as
at 3
1.03
.202
03.
64
181.
91
946.
84
39.5
6 23
.09
24.9
3 0.
00
62.2
8 92
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1374
.55
Acc
umul
ated
Dep
reci
atio
n &
Im
pair
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tA
ccum
ulat
ed D
epre
ciat
ion
as a
t 01.
04.2
019
- -
- -
- -
- -
- -
Dep
reci
atio
n ch
arge
dur
ing
the
year
- -
- -
- -
- -
- -
Inte
r-he
ad T
rans
fer I
n /(O
ut)
- -
- -
- -
- -
- -
Tran
sfer
Fro
m D
isca
rded
Ass
ets
- -
- -
- -
- -
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sfer
To
Dis
card
ed A
sset
s -
- -
- -
- -
- -
- Im
pair
men
t Los
ses
- -
- -
- -
- -
- -
Dis
posa
ls -
- -
- -
- -
- -
- A
ccum
ulat
ed D
epre
ciat
on &
Im
pair
men
t as
at 3
1.03
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0 -
- -
- -
- -
- -
- N
et C
arry
ing
Am
ount
as
at 3
1.03
.202
03.
64
181.
91
946.
84
39.5
6 23
.09
24.9
3 0.
00
62.2
8 92
.30
1374
.55
Less
Pro
visi
ons
for
Dis
card
ed A
sset
s13
74.5
5 N
et C
arry
ing
Am
ount
(Net
of P
rovi
sion
s) a
s at
31.
03.2
020
-
Not
e : H
CL h
as u
sed
the
exem
ptio
n av
aila
ble
in In
d AS
101
with
res
pect
to r
ecog
nitio
n of
Pro
pert
y, P
lant
, Equ
ipm
ents
(PPE
) and
Inta
ngib
le A
sset
s at
thei
r car
ryin
g va
lue.
Notes to Consolidated Financial Statements (Contd...)
F-97
151
Note No. 4 : CAPITAL WORK IN PROGRESS
i) Building 163.27 24.22ii) Plant & Machinery 34389.11 33836.57iii) Others including Mine Expansion 92018.10 72439.01
126570.48 106299.80Less: Provision 3392.91 4088.49Total 123177.57 102211.31
ii) Non Trade Investment in Debentures 0.17 0.17Less : Provision for diminution in value 0.17 - 0.17 -
TOTAL 3.00 -
AGGREGATE BOOK VALUE - UNQUOTED 3.00 -
AGGREGATE BOOK VALUE - QUOTED Nil Nil
MARKET PRICE OF QUOTED INVESTMENT - -
Details of JVCPrincipal Activity and place of incoporation Principal place of
business Proportion of ownership interest / voting rights held by the Company as on 31.03.2020
To identify, explore, acquire, develop, process primarily strategic minerals overseas for supply to India for meeting domestic requirements and for sale to any other countries for commercial use.
New Delhi 30%
Note No. 5 : NON - CURRENT FINANCIAL ASSETS - INVESTMENTS
i) Investments in equity instruments - (classified as at cost)A Joint Venture Company (JVC) named Khanij Bidesh India Limited (KABIL) was formed on 01.08.2019 among National Almunium Company (NALCO), Hindustan Coper Limited (HCL) and Mineral Exporated Corporations Limited (MECL)Investment in JV Company - Khanij Bidesh India Limited (KABIL) 3.00 -(Investment in KABIL 30,000 Nos. (Previous Year Nil) of equity shares of H10 (Previous Year H Nil) each fully paid up as at 31.03.2020)
Notes to Consolidated Financial Statements (Contd...)
Note No. 6 : NON - CURRENT FINANCIAL ASSETS - OTHERS
Bank deposits with more than 12 months maturity- With scheduled banks 26.36 12.47Total 26.36 12.47
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-98
152
Note No. 7 : DEFERRED TAX ASSETS (NET)
i) DEFERRED TAX ASSETOPENING BALANCE 9243.90 8780.81Adjustment/Credit during the year (3379.68) 463.09 CLOSING BALANCE 5864.22 9243.90
ii) DEFERRED TAX LIABILITYOPENING BALANCE (2998.28) (3203.10)Adjustment/Credit during the year 1083.85 204.82 CLOSING BALANCE (1914.43) (2998.28)
i)-ii) DEFERRED TAX ASSETS / (LIABILITIES) (Net) 3949.79 6245.62iii) DEFINED BENEFIT PLANS
OPENING BALANCE 585.74 - Adjustment/Credit during the year 755.28 585.74CLOSING BALANCE 1341.02 585.74
DEFERRED TAX ASSETS / (LIABILITIES) (Net) including OCI 5290.81 6831.36(Refer Note No. 39 General Notes on Accounts Point No. 18)
Notes to Consolidated Financial Statements (Contd...)
Note No. 8 : NON-CURRENT TAX ASSETS (NET)
Income Tax (including advance income tax, TDS & excluding current tax liability) Unsecured - Considered good
689.82 620.33
TOTAL 689.82 620.33
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-99
153
Note No. 9 : OTHER NON-CURRENT ASSETS
a) MOBILISATION ADVANCESi) Secured (considered good) 1632.12 2178.89ii) Unsecured (considered good)
– Against Bank Guarantee - - – Others - -
iii) Unsecured (considered doubtful) 0.02 0.02Less: Provisions for Capital Advances * 0.02 - 0.02 -
b) Other Loans & AdvancesReceivable from MPSEB - 828.53
c) Mine Development ExpenditureAs per Last Balance Sheet 51115.82 53068.54Add: Expenditure during the Year (as per Note Below) 22505.21 19898.22
73621.03 72966.76Less: Value of Ore recovered during Mine Development 144.95 223.84Less: Amortisation during the Year 25271.73 25416.68 21627.10 21850.94
48204.35 51115.82Less: Provision 4664.86 4664.86Total 43539.49 46450.96Note: MINE DEVELOPMENT EXPENDITURE DURING THE YEAR
i) Salaries, Wages, Allowances 2655.31 2182.50ii) Contribution to Provident & Other Funds 211.43 170.84iii) Workmen & Staff Welfare Expenses 9.68 9.03iv) Stores, Spares & Tools Consumed 1963.75 2369.33v) Power, Fuel & Water 655.21 475.32vi) Royalty 11.03 16.10vii) Repair & Maitenance 4352.83 4222.59viii) Insurance 1.17 1.76ix) Overburden Removal Expenditure 11275.24 9711.09x) Depreciation 446.57 304.95xi) Other Expenses 922.99 434.71
Total 22505.21 19898.22
The above expenditure is in addition to the expenses shown under the respective natural head of accounts indicated and charged in the Statement of Profit and Loss Account for the year and in the relevant schedules thereof.
Amortisation during the year is in relation to the expenses incurred on mines which are under operation/production and does not include expenditure on prospecting of minerals in new mines area.
Notes to Consolidated Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-100
154
d) Right to UseRent for Leasehold Land 4097.67 3810.40TOTAL 4097.67 3810.40TOTAL (a+b+c+d) 49269.28 53268.78
PROVISIONS FOR CAPITAL ADVANCES *OPENING BALANCE 0.02 0.02Additions during the year - - Amount used during the year - - CLOSING BALANCE 0.02 0.02
Note No. 10 : INVENTORIES
i) Raw Materials - - ii) Semi-Finished and In-Process (at lower of cost or net
realisable value)64456.03 58249.42
Less: Provision for Semi-Finished and In-Process* 18454.83 46001.20 123.03 58126.39iii) Finished Goods (at lower of cost or net realisable value) 83.00 1176.03iv) Stores and spares 7646.10 7371.35
Stores in transit/ pending inspection 603.30 309.038249.40 7680.38
Less: Provision for Obsolete Stores & Spares ** 2350.88 5898.52 2616.03 5064.35TOTAL 51982.72 64366.77PROVISION FOR SEMI-FINISHED AND IN-PROCESS*OPENING BALANCE 123.03 123.03Additions during the year 18331.80 - Amount used during the year - - CLOSING BALANCE 18454.83 123.03PROVISION FOR OBSOLETE STORES & SPARES **OPENING BALANCE 2616.03 2534.25Additions during the year 1.40 106.81Amount used during the year 266.55 25.03CLOSING BALANCE 2350.88 2616.03(Refer Note No. 39 General Notes on Accounts Point No. 23)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
Notes to Consolidated Financial Statements (Contd...)
F-101
155
Note No. 11 : CURRENT FINANCIAL ASSETS - INVESTMENTS
Investments in Mutual Fund (Maturity within 3 months from date of original investments)
Number of units
NAV (in H)
UTI MONEY MARKET - GROWTH 51.736(51.736)
2267.76(2112.55)
1.17 1.09
SBI ULTRA SHORT TERM DEBT FUND - GROWTH
132.117(132.117)
4479.65(4169.40)
5.92 5.51
CANARA REBECO LIQUID FUND - GROWTH
38.993(38.993)
2389.98(2258.68)
0.93 0.88
IDBI LIQUID FUND - GROWTH 68.469(68.469)
2130.97(2002.99)
1.46 1.37
TOTAL 9.48 8.85AGGREGATE BOOK VALUE - UNQUOTED
Nil Nil
AGGREGATE BOOK VALUE - QUOTED
7.84 7.84
MARKET PRICE OF QUOTED INVESTMENT
9.48 8.85
Notes to Consolidated Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
Note No. 12 : CURRENT FINANCIAL ASSETS - TRADE RECEIVABLES
DEBTS OUTSTANDING i) - Secured - Considered good 8289.35 36154.83ii) - Unsecured - Considered good - -iii) - Considered doubtful 886.51 942.77
9175.86 37097.60Less: Allowances for bad & doubtful debts * 886.51 8289.35 942.77 36154.83
TOTAL 8289.35 36154.83ALLOWANCES FOR BAD & DOUBTFUL DEBTS *OPENING BALANCE 942.77 935.89Additions during the year 0.31 22.46Amount used during the year 56.57 15.58 CLOSING BALANCE 886.51 942.77
Explanatory Note: - Debt due by Directors or other officers of the company or any of them either severally or jointly with any other person or debts due by firms or private companies respectively in which any Director of the Company is a partner or a Director or a member amounts to H Nil (Previous year H Nil).
F-102
156
Note No. 13 : CURRENT FINANCIAL ASSETS - CASH & CASH EQUIVALENTS
I. CASH AND CASH EQUIVALENTS i. Cash on hand including imprest 0.25 0.25ii. Balance with Banks
-Current Account 1134.61 663.28II. OTHER BALANCES WITH BANK
Bank deposits upto 3 months maturity from date of original investment- With scheduled banks - - Total 1134.86 663.53
Note No. 14 : CURRENT FINANCIAL ASSETS - BANK BALANCE OTHER THAN CASH & CASH EQUIVALENTS
I. Other Balances with Bank - In Dividend Balance Account 20.31 15.86
II. Bank deposits with more than 3 months and upto 12 months maturity- With scheduled banks 432.21 408.33Total 452.52 424.19
Notes to Consolidated Financial Statements (Contd...)
Note No. 15 : CURRENT FINANCIAL ASSETS - OTHERS
a) ADVANCES*Employees - Secured (considered good) 112.55 69.84- Unsecured (considered doubtful) 2.03 2.03Less : Provisions for doubtful Advances* 2.03 2.03
112.55 69.84b) INTEREST ACCRUED ONi) LC from Customers - 0.78ii) Investments 10.66 9.16 iii) Deposits 29.64 23.92iv) Others 0.36 40.66 0.58 34.44c) CLAIMS RECOVERABLE
Claims recoverable from different agencies 2712.61 3308.75Less: Provision for Doubtful Claims ** 179.41 2533.20 133.10 3175.65TOTAL (a+b+c) 2686.41 3279.93DETAILS OF PROVISIONS"PROVISION FOR DOUBTFUL ADVANCES *"OPENING BALANCE 2.03 2.03Additions during the year - - Amount used during the year - - CLOSING BALANCE 2.03 2.03
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-103
157
Note No. 17 : OTHER CURRENT ASSETS
a) Advances to contractors / suppliers - Secured (considered good) 239.21 218.29- Unsecured (considered good)
– Against Bank Guarantee - - – Others 1127.08 2099.84
- Unsecured (considered doubtful) 679.54 723.332045.83 3041.46
b) Other Advances- secured (considered good) 50.90 50.90- Unsecured (considered doubtful) 13.93 13.93
64.83 64.832110.66 3106.29
Less : Provision for Doubtful Loans and Advances * 693.47 737.261417.19 2369.03
c) Advance to JV-KABIL 72.00 - Add/(Less): Group Share of Profits/(Loss) in Jv/Associates upto 31.03.2020
27.64 -
44.36 - d) DEPOSITS
Other Deposits 10136.08 9392.51Less : Provision for Doubtful Deposits ** 75.56 75.56
10060.52 9316.95e) OTHER CURRENT ASSETS
Other Current Assets 211.52 277.33Less: Provision for Other Current Assets *** 3.52 3.52
208.00 273.81
Note No. 16 : CURRENT TAX ASSETS (Net)
Income Tax (including advance income tax, TDS & excluding current tax liability) Unsecured - Considered good
1845.39 -
Total 1845.39 -
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019"PROVISION FOR DOUBTFUL CLAIMS**"OPENING BALANCE 133.10 133.14Additions during the year 46.31 - Amount used during the year - 0.04CLOSING BALANCE 179.41 133.10Explanatory Note: - PARTICULARS OF LOANS AND ADVANCES DUE FROM DIRECTORS
i) Amount due at the end of the year H Nil H Nilii) Advance due by firms or private companies in which any Director of the Company is a Partner or a director or a member amounts to H Nil (Previous year H Nil)
Notes to Consolidated Financial Statements (Contd...)
F-104
158
f) OTHER RECOVERABLESIGST/CGST & SGST 25554.81 20002.22
g) RIGHT TO USERent for Leasehold Land 206.61 141.29TOTAL 37491.49 32103.30DETAILS OF PROVISIONSPROVISION FOR DOUBTFUL LOANS AND ADVANCES*OPENING BALANCE 737.26 728.63Additions during the year 2.52 8.63Amount used during the year 46.31 - CLOSING BALANCE 693.47 737.26PROVISIONS FOR DEPOSITS **OPENING BALANCE 75.56 75.56Additions during the year - - Amount used during the year - - CLOSING BALANCE 75.56 75.56PROVISION FOR OTHER CURRENT ASSETS ***OPENING BALANCE 3.52 3.52Additions during the year - - Amount used during the year - - CLOSING BALANCE 3.52 3.52
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
Notes to Consolidated Financial Statements (Contd...)
F-105
159
Note No. 18 : EQUITY SHARE CAPITAL
a) AUTHORISED SHARE CAPITAL - Equity Share Capital 1800000000 90000.00 1800000000 90000.00- 7.50% Non-Cum. Redeemable Preference Shares 2000000 20000.00 2000000 20000.00
b) PAR VALUE PER EQUITY SHARE (in J) 5.00 5.00c) PAR VALUE PER PREFERENCE SHARE (in J) 1000.00 1000.00d) NO. OF SHARES ISSUED, SUBSCRIBED
AND FULLY PAID UP- Equity Share Capital 925218000 46260.90 925218000 46260.90- 7.50% Non-Cum. Redeemable Preference Shares - - - - Total 46260.90 46260.90
e) RECONCILIATION OF NO. OF SHARES & SHARE CAPITAL OUTSTANDING: No. of Shares (J in lakh) No. of Shares (J in lakh)OUTSTANDING AS ON 01.04.2019 925218000 46260.90 925218000 46260.90Add: Share Capital issued/ subscribed during the year
- - - -
Less: Reduction in Share Capital - - - -OUTSTANDING AS ON 31.03.2020 925218000 46260.90 925218000 46260.90
f) TERMS/RIGHTS ATTACHED TO EQUITY SHARES
The Company has only one class of Equity Shares having par value of H5/- each and is entitled to one vote per share.
g) SHARES IN THE COMPANY HELD BY EACH SHAREHOLDER HOLDING MORE THAN 5 PERCENT OF THE NUMBER OF SHARES
In No. In (%) In No. In (%)
- President of India 703587852 76.05% 703587852 76.05%- Life Insurance Corporation of India 105685666 11.42% 112338152 12.14%For Subsidiary - HCL 185000 74.00% 185000 74.00%- CMDC LTD 65000 26.00% 65000 26.00%
(H in lakh) PARTICULARS As at 31st March, 2020 As at 31st March, 2019
In No. (J in lakh) In No. (J in lakh)
Notes to Consolidated Financial Statements (Contd...)
F-106
160
Note No. 19 : OTHER EQUITY
a) CAPITAL RESERVE *AS PER LAST BALANCE SHEET 21166.24 21166.24
b) GENERAL RESERVEAS PER LAST BALANCE SHEET 8965.97 8965.97
c) CORPORATE SOCIAL RESPONSIBILITY FUNDAS PER LAST BALANCE SHEET - 22.78 Add: During the year - - Less: Amount reversed during the year - - Less: Amount used during the year - 22.78 AS AT BALANCE SHEET DATE - -
d) MINE CLOSURE RESERVEAS PER LAST BALANCE SHEET 163.00 - Add: During the year 75.00 163.00 Less: Amount reversed during the year - - Less: Amount used during the year - - AS AT BALANCE SHEET DATE 238.00 163.00
e) CURRENCY FLUCTUATION RESERVE **AS AT BALANCE SHEET DATE 155.94 - Add: Equity Component of Foreign Currency Loan (2764.59) 155.94 Less: Amount reversed during the year - - Less: Amount used during the year - - AS AT BALANCE SHEET DATE (2608.65) 155.94
f) RETAINED EARNING *** 21972.63 86966.84Total 49734.19 117417.99Details of Retained Earning ***Profit /(Loss) for the period after tax as per statement of Profit and Loss
(56920.82) 14526.26
Add/(Less): Group Share of Profits/(Loss) in Jv/Associates
(27.64) -
Less : Profit /(Loss) for the period after tax - Attributable to Non Controlling Interest
- (6.45)
Profit /(Loss) for the period after tax - Attributable to Owners
(56948.46) 14532.71
Other Comprehensive Income /(Loss) as per Statement of Profit and Loss (net of tax)
(2245.67) (1090.47)
Total Comprehensive Income /(Loss) for the period (59194.13) 13435.79Total Comprehensive Income for the period- Attributable to Owners
(59194.13) 13442.24
Balance brought forward 86966.84 76313.10BALANCE AVAILABLE FOR APPROPRIATION 27772.71 89755.34
i) Less :Dividend 4811.14 2313.05 ii) Less :Tax on Dividend 988.94 475.45
BALANCE CARRIED FORWARD 21972.63 86966.84* Capital Reserve is created from the Grant received from the Government of India during the approval of Financial Re-structuring proposal by Ministry of Mines and out of Capital Profits over the years.This Reserve is not created out of Revenue Profits of the Company.** Currency Fluctuation Reserve is not created out of Revenue Profits of the Company.
Notes to Consolidated Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-107
161
Note No. 20 : NON-CURRENT FINANCIAL LIABILITIES - BORROWINGS
LONG TERM LOANS• From Banks/ FIs
- Secured- EXIM Bank (Loan I) - 5443.02
First charge over the entire movable Fixed Assest of Gujarat Coppr project, both present out future
(The title deeds for Freehold and Leasehold Land and Building acquired in respect of Gujarat Copper Project are yet to be executed. Pending the same, the title deeds of land of TCP has been submitted as an alternate security over which no hypothecation has been created.)
- EXIM Bank (Loan II) 22647.53 28215.21(First pari-passu charge on movable fixed assets, both present and future of the Company, excluding GCP and TCP)
- SBI 18975.00 17407.50(First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
- UBI 9800.00 - (First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
- HDFC(First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
9500.00 -
- AXIS(First pari-passu charge on immovable fixed assets of the Company located at MCP, both present and future, excluding leasehold land/property)
2695.00 -
- Unsecured- Axis Bank - 6000.00
Total 63617.53 57065.73
Note No. 21 : NON-CURRENT FINANCIAL LIABILITIES - OTHERS
Others (Compensation received from Govt of Jharkhand for repair of township)
843.53 843.53
TOTAL 843.53 843.53
Notes to Consolidated Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-108
162
Note No. 22 : NON - CURRENT - PROVISIONS
PROVISION FOR EMPLOYEE BENEFITSi) PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 10920.32 11930.19Additions during the year - - Amount used during the year 1887.66 1009.87CLOSING BALANCE 9032.66 10920.32
ii) PROVISION FOR GRATUITY AS PER LAST BALANCE SHEET (5448.73) (3743.46)Additions during the year 2982.00 1094.73Amount used/funded during the year 0.00 2800.00CLOSING BALANCE (2466.73) (5448.73)Total 6565.93 5471.59(Refer Note No. 39 General Notes on Accounts Point No. 20)
Note No. 23 : CURRENT FINANCIAL LIABILITIES - BORROWINGS
SHORT TERM LOANS- Cash Credit- From Banks/ FIs 13603.41 16503.81- WCDL- From Banks/ FIs 16300.00 - - Secured (Secured by hypothecation of Stock-in-Trade,Stores
& Spare Parts and Book Debts, both present and future of the Company)
- Working Capital Term Loan (Unsecured)- Axis Bank 22000.00 9702.84- Kotak Mahindra Bank 5000.00 - - HDFC Bank 10500.00 13000.00- IOB 1250.00 - - UBI 1250.00 - LONG TERM LOANS• Due in next 1 year
- EXIM Bank (Loan I) 5933.16 5443.04- EXIM Bank (Loan II) 8108.39 1795.51- Axis Bank 8105.00 3500.00- HDFC Bank 500.00 - - UBI Bank 200.00 -
Total 92749.96 49945.20
Note No. 24 : CURRENT FINANCIAL LIABILITIES - TRADE PAYABLE
i) Total outstanding dues of micro entreprises and small enterprises 961.60 535.45ii) Total outstanding dues of creditors other than micro enperprises
and small enterprises22412.82 19693.63
Total 23374.42 20229.08
Notes to Consolidated Financial Statements (Contd...)
(H in lakh)PARTICULARS As at 31st March, 2020 As at 31st March, 2019
F-109
163
Note No. 25 : CURRENT FINANCIAL LIABILITIES - OTHERS
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019i) Interest accrued but not due on borrowings & term loans 505.95 359.97ii) Unpaid dividend 20.31 15.86iii) Deposits/ Retention money 6361.34 5885.05iv) Other liabilities 1694.61 1339.49
Total 8582.21 7600.37
Note No. 26 : OTHER CURRENT LIABILITIES
i) Statutory dues payables 5763.29 4665.09ii) Advances from Customers 3105.82 1977.75iii) Other Liabilities 8115.70 12241.10
Total 16984.81 18883.94
Note No. 27 : CURRENT - PROVISIONS
a) PROVISION FOR EMPLOYEE BENEFITSi) PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 1980.85 741.60Additions during the year - 1239.25Amount used during the year 386.97 - CLOSING BALANCE 1593.88 1980.85
ii) PROVISION FOR GRATUITY AS PER LAST BALANCE SHEET (2860.89) (3513.13)Additions during the year 29.48 652.24 Amount used during the year - - CLOSING BALANCE (2831.41) (2860.89)
iii) PROVISION FOR LEAVE TRAVEL CONCESSION (LTC)AS PER LAST BALANCE SHEET 171.93 139.11Additions during the year 26.10 32.82Amount used during the year - - CLOSING BALANCE 198.03 171.93
iv) PROVISION FOR PRP/INCENTIVEAS PER LAST BALANCE SHEET 1727.00 882.00Additions during the year - 1145.00Amount used during the year 582.00 300.00CLOSING BALANCE 1145.00 1727.00
v) PROVISION FOR WAGE REVISIONAS PER LAST BALANCE SHEET 4258.27 5621.17Additions during the year - -
Notes to Consolidated Financial Statements (Contd...)
(H in lakh)Particulars As at
31st March, 2020As at
31st March, 2019
F-110
164
Amount used during the year 2379.40 1362.90CLOSING BALANCE 1878.87 4258.27
b) OTHERSi) DIVIDEND
AS PER LAST BALANCE SHEET - - Additions during the year 4811.14 2313.05Amount used during the year 4811.14 2313.05CLOSING BALANCE - -
ii) TAX ON DIVIDENDAS PER LAST BALANCE SHEET - - Additions during the year 988.94 475.45 Amount used during the year 988.94 475.45 CLOSING BALANCE - -
iii) PROVISION - OTHERSAS PER LAST BALANCE SHEET 1019.87 1366.75Additions during the year 329.76 33.59Amount used during the year 270.96 380.47CLOSING BALANCE 1078.67 1019.87Total 3063.04 6297.03 (Refer Note No. 39 General Notes on Accounts Point No. 19 & 20)
Note No. 28 : CURRENT TAX LIABILITIES (Net)
Additions during the year - 8644.62Less : Refund pertaining to earlier years - 310.58 Less : Advance Income Tax & TDS - 6750.08Current Tax Liabilities (Net of Advance Tax & TDS) - 1583.96
(H in lakh)PARTICULARS As at 31st March, 2020 As at 31st March, 2019
Notes to Consolidated Financial Statements (Contd...)
F-111
165
Note No. 29 : REVENUE FROM OPERATIONS
SALE OF PRODUCTS- Domestic 34187.32 91076.52- Export 46129.33 84267.33
80316.65 175343.85Less : Discount & Rebate - 14.55SALES (Net of Discounts) (A) 80316.65 175329.30SALE OF SERVICES (B) 310.79 455.70OTHER OPERATING INCOME (C) -Sale of Scrap 329.54 987.36 -Interest from Customers 116.11 246.35-Interest from Contractors against mobilization advances for mining operations
252.49 262.80
- Penalty & Liquidated Damages 1920.36 1752.00Less : Refunded during the year 60.69 1859.67 203.57 1548.43-Excess Electricity Charges earlier paid adjusted by MPSEB against current Electricity bills
- 2795.78
TOTAL (C) 2557.81 5840.72TOTAL (A+B+C) 83185.25 181625.72
Note No. 30 : OTHER INCOME
- Claims Received 8.80 10.44- Interest from Term Deposits 29.63 96.62- Interest - Others 992.27 237.87- Profit on sale of Assets - 48.24 - Profit on Fair Value of Investment 0.63 0.67 - Others 2384.06 2176.74- Provisions not required written back # 2280.83 1095.29Total 5696.22 3665.87Details of Provisions not required written back # (Refer Note No.39 General Notes on Accounts Point No.11)Bad and doubtful Debts,advances/deposits & claims 56.57 16.56 Excess provisions on account of shortage,non-moving, obselete & insurance Stores & Spares and finished goods (net)
266.54 26.93
Provision for Discarded Assets no longer required - 1.16 Prov Written back for feasibility study of Concentrator plant at MCP
827.46 -
Provision for CSR no longer required Written Back - 30.59 Provision for Interest on MSME 264.01 169.94 Provision for MP Rural Infrastructure & Road Development Tax & Water Charges
- 370.78
Excess Provision created for Transportation of Copper Concentrate from KCC to load port
179.56 -
Old Liability Written Back for S.Creditors, SD & EMD more than 5 years and Others
686.69 479.33
Total 2280.83 1095.29
(H in lakh)PARTICULARS For the year ended
31st March, 2020 For the year ended
31st March, 2019
Notes to Consolidated Financial Statements (Contd...)
F-112
166
Note No. 32 : CHANGES IN INVENTORIES OF FINISHED GOODS, SEMI-FINISHED AND WORK- IN-PROCESS
A. OPENING STOCK:Finished Goods 1176.03 257.24Semi-Finished and In-Process 58249.42 73504.95TOTAL OPENING STOCK 59425.45 73762.19
B. CLOSING STOCK:Finished Goods 83.00 1176.03Semi-Finished and In-Process 64456.03 58249.42TOTAL CLOSING STOCK 64539.03 59425.45(INCREASE)/ DECREASE (A-B) (5113.58) 14336.74
Note No. 34 : FINANCE COST
- Interest on Cash Credit 2001.93 1339.00- Others (including Term Loans) 4039.96 4207.10Total 6041.89 5546.10
Note No. 33 : EMPLOYEES BENEFIT EXPENSE
Salaries, Wages & Allowances 21806.24 23320.29Bonus/Ex-gratia/Performance Related Pay 104.00 1426.21Contribution to Provident & Other Funds 2186.55 2263.98Workmen & Staff Welfare Expenses 1568.32 1696.74Gratuity & Leave Encashment 297.20 2944.26Total 25962.31 31651.48 Explanatory Note: - The detail of Remuneration paid/payable to Directors as included in above payments are as follows: - (i) Salaries & Allowances 153.84 186.11(ii) Contribution to Provident & Other Funds 13.18 13.99(iii) Re-imbursement of Medical Expenses 1.06 0.53(iv) Leave Encashment 32.83 13.23(v) Gratuity paid 20.00 10.00(vi) Other Benefits 29.68 26.21Total 250.59 250.07
In addition the Whole-time Directors are allowed the use of company car for private purpose and have been provided with residential accommodation as per terms of their appointment / Government guidelines and the charges are recovered at the rates prescribed by the Government.
Note No. 31 : COST OF MATERIALS CONSUMED
Raw Materials Consumed 483.29 6269.57Value of Ore Raised During Mine Development 144.95 223.84Total 628.24 6493.41
(H in lakh)PARTICULARS For the year ended
31st March, 2020 For the year ended
31st March, 2019
Notes to Consolidated Financial Statements (Contd...)
F-113
167
Note No. 35 : DEPRECIATION AND AMORTISATION EXPENSE
A. DEPRECIATIONDepreciation for the year 4036.90 3967.25Less: Depreciation transferred to Mine Development Expenditure
446.57 304.95
SUB TOTAL (A) 3590.33 3662.30B. AMORTISATION
Amortisation during the year * 25271.73 21627.10SUB TOTAL (B) 25271.73 21627.10TOTAL (A+B) 28862.06 25289.40
* Amortisation during the year is in relation to the expenses incurred on mines which are under operation/production and does not include expenditure on prospecting of minerals in new mines area
Note No. 36 : OTHER EXPENSES
A. OTHER MANUFACTURING EXPENSES- Stores, Spares& Tools Consumed 10618.82 11706.53- Consumption of Power, Fuel & Water 17757.59 22186.57- Royalty, Cess & Decretal amount 7717.04 9803.47- Contractual Job for Process 16744.17 13905.88- Handling & Transportation 2975.64 6811.67- Expenses for Leasehold Land 206.61 141.29SUB TOTAL (A) 56019.87 64555.41
B. REPAIRS & MAINTENANCE & MAJOR OVERHAUL EXPENSES- Building 145.54 195.08- Machinery 4003.83 4889.34- Others 817.77 681.86SUB TOTAL (B) 4967.14 5766.28
C. ADMINISTRATION EXPENSES- Insurance 383.85 204.77- Rent 133.26 137.83- Rates and Taxes 1132.38 766.15- Security Expenses 804.49 970.41- Travelling and Conveyance 410.12 562.57- Telephone, Telex and Postage 129.93 144.03- Advertisement and Publicity 246.45 174.90- Printing and Stationery 70.15 125.70- Books & Periodicals 1.81 3.63- Consultancy Charges - Indigenous 1006.15 757.67- Loss on Sale of Assets(Net) 2.04 - - MTM Debit/(Credit) Foreign Exchange (20.80) 1071.48- Exchange Rate Variation (Net) - 0.17 - Corporate Social Responsibility Expenses 331.01 185.38- Hire Charges 299.78 389.86- Audit Expenses (Refer detail below at Sl 1) 42.41 30.28- Independent Directors Expenses 12.75 10.35- Bank Charges 176.93 155.01- Other General Expenses 1241.43 1051.91SUB TOTAL (C) 6404.14 6742.10
D. PROVISIONS (Refer detail below at Sl 2) 18866.24 1900.82
TOTAL (A+B+C+D) 86257.39 78964.61
(H in lakh)PARTICULARS For the year ended
31st March, 2020 For the year ended
31st March, 2019
Notes to Consolidated Financial Statements (Contd...)
F-114
168
Explanatory Note: - 1) Detail of Audit Expenses are as under: -
i) Statutory Auditors- Statutory Audit Fees 16.65 11.15- Tax Audit Fees 5.16 0.89- In Other Capacity 14.95 8.65- Reimbursement of Expenses 2.29 39.05 5.81 26.50
ii) Cost Auditors- Cost Audit Fees 0.70 0.61- Reimbursement of Expenses 0.47 1.17 0.86 1.47
iii) Internal Auditors- Audit Fees 0.65 0.65- Reimbursement of expenses 1.54 2.19 1.66 2.31
Total 42.41 30.282) Detail of Provisions are as under: -
Doubtful debts 0.31 - Doubtful advances / deposits 2.52 9.82Provisions for Obsolete /Non-moving Stores 1.05 108.71Provisions for WIP & Finished Goods 18331.80 - Provisions for Capital Work In Progress 131.88 695.58Provisions for Loss of Assets - 631.54Interest on MSMED 323.68 291.03Provision for Mine Closure Expenditure 75.00 163.00Provision for Others - 1.14
Total 18866.24 1900.82
Note No. 37 : TAX EXPENSE
CURRENT TAX Income Tax Provision - 8656.75Income Tax relating to earlier years 842.18 472.18Deferred Tax Account 2295.83 (667.91)Total 3138.01 8461.02
Note No. 38 : OTHER COMPREHENSIVE INCOME
A(i) Items that will not be reclassified to Profit/(Loss) Acturial gain/loss recognised in the year for employees : Gratuity (3000.95) (1676.21)TOTAL (A(i)) (3000.95) (1676.21)
A(ii) Income Tax relating to items that will not be reclassified to Profit /(Loss)
755.28 585.74
TOTAL (A(ii)) 755.28 585.74 B(i) Items that will be reclassified to Profit/(Loss) -
TOTAL (B(i)) - - B(ii) Income Tax relating to items that will be reclassified to
Profit / (Loss)TOTAL (B(ii)) - -
(H in lakh)PARTICULARS For the year ended
31st March, 2020 For the year ended
31st March, 2019
Notes to Consolidated Financial Statements (Contd...)
F-115
169
Note No. : 39 GENERAL NOTES ON ACCOUNTS
1. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)(i) Contingent Liabilities: -
a. Claims against the Group not acknowledged as debt: 2019-20 (J in lakh)
2018-19 (J in lakh)
i. Disputed VAT / CST / Entry Tax 3516.76 3347.51ii. Disputed Excise Duty 2947.97 5747.41iii. Disputed Income Tax / Provident Fund 23113.43 11101.54iv. Other Demand 39110.70 34578.47
SUB-TOTAL (A) 68688.86 54774.93b. Other money for which the Group is contingently liable :
i. Bank Guarantee 2767.54 2585.42ii. Letter of Credit 53.26 1894.47iii. Bill discounting - 6636.44
SUB-TOTAL (B) 2820.80 11116.33GRAND TOTAL (A+B) 71509.66 65891.26
(ii) Commitments:-Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of advance and deposit)
73913.51 86661.55
Details of Claims against the Group not acknowledged as debt (of 1(i)(a) above)
VAT/CST/ENTRY TAX There are demand notices totaling to Gross Demand of H3516.76 lakh (Previous Year H3347.51 lakh) from various State
Revenue Authorities regarding VAT/CST/Entry Tax against which the Group has deposited under protest H620.44 lakh (Previous Year H610.33 lakh). The Group is contesting the demand and the management as well as the legal advisors/consultants are of the opinion that its contention will likely to be upheld by the Appellate Authorities. The Group also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the Group.
EXCISE DUTY There are demand notices totaling to Gross Demand of H2947.97 lakh (Previous Year H5747.41 lakh) from Central
Excise Authorities regarding Excise Duty against which the Group has deposited under protest H68.37 lakh (Previous Year H30.34 lakh). The Group is contesting the demand and the management as well as the legal advisors/consultants are of the opinion that its contention will likely to be upheld by the Appellate Authorities. The Group also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the Group.
INCOME TAX/PROVIDENT FUND There are Income Tax demand notices totaling to Gross Demand of H23113.43 lakh (Previous Year H11101.54 lakh). The
management as well as the income tax consultant are of the opinion that its contention will likely to be upheld by the Appellate Authorities/High Court. The Group also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the Group.
OTHER DEMAND of J38685.29 lakh (Previous Year J34578.47 lakh) The major pending litigation cases are as follows:
a. The Municipal Council, Malanjkhand, raised a demand on Malanjkhand Copper Project (MCP) amounting to H7046.64 lakh on account of penalty on Terminal Tax for the periods from financial year 2000-01 to 2005-06 on the ground of short payment of Terminal Tax by adopting higher assessable value as well as higher of Metal in Ore (MIO) produced and Metal in Concentrate (MIC) despatched. The matter was contested by the Group before the Hon’ble High Court, Jabalpur, M.P. and the Group paid H352.33 lakh towards penalty Terminal Tax as per the order of Hon’ble High Court, Jabalpur, M.P. Subsequently the matter was turned down by the Hon’ble High Court,
NOTE FORMATING PART OF ACCOUNTS
Notes to Consolidated Financial Statements (Contd...)
F-116
170
Jabalpur, M.P. The Group filed writ petition before the Hon’ble Supreme Court of India. The Hon’ble Supreme Court vide its order dated 29.07.2011 directed the Group to deposit an ad-hoc amount of H1000.00 lakh to Municipal Council, Malanjkhand which has since been deposited by the Group and shown as ‘Deposits with Court’ and also ordered that the matter may be heard on the ground of merit by the Civil Court, Baihar. Further a demand of H18867.56 lakh for the periods from 2006-07 to 2011-12 was also raised on the above ground for which the appeal by the Group is pending before the Hon’ble Supreme Court. Pending final decision, the full amount of H25914.20 lakh has been disclosed under ‘Contingent Liability’.
b. The Deputy Registrar, Khetri, Rajasthan issued demands on KCC for H4819.27 lakh on account of re-assessment of land tax for Khetri, Kolihan & Chandmari mines for several years. The Group has already paid H2211.61 lakh against the same. The matter is contested by the Group before the Assessing Authority. Pending final decision, the full amount of H4819.27 lakh has been disclosed under ‘Contingent Liability’.
c. The Municipal Council, Malanjkhand, Madhya Pradesh issued demands on MCP for H558.24 lakh on account of Property Tax for several years against which the Group filed writ petitions before the Hon’ble Madhya Pradesh High Court, Jabalpur challenging the demand notice. The amount of H558.24 lakh has been included under ‘Contingent Liability’.
d. There was a trade dispute with M/S Bhagawati Gases Ltd (BGL) in connection with an agreement to supply of gaseous oxygen at Khetri Copper Complex. The dispute was referred to Arbitration. The claim of BGL is for an amount of H1079.80 lakh with a corresponding counter claim of H534.62 lakh by the Group. The arbitral award went against the Group. The Group had filed an appeal before the Hon’ble High Court of Rajasthan and the same was admitted for hearing. The Group preferred appeal before the Hon’ble Rajasthan High Court regarding interim deposit of arbitral award pending disposal of original appeal, but the same was dismissed. Thereafter the Group had preferred appeal before Hon’ble Supreme Court and the Hon’ble Supreme Court passed the order directing the Group to deposit the entire decrial amount along with interest amounting to H1733.50 lakh in the form of Fixed Deposit. The Group deposited the said amount and shown the same as Deposit in Current assets. Pending decision of the original appeal against arbitral award before the Hon’ble Rajasthan High Court, the said amount of H1733.50 lakh has been disclosed under ‘Contingent Liability’.
e. There was a demand from M/S Uttkal Moulders amounting to H1662.72 lakh regarding interest for delayed payment against supply of grinding media balls at Malanjkhand Copper Project. The case is pending before the Sole Arbitrator. Pending final decision, the said amount of H1662.72 lakh has been disclosed under ‘Contingent Liability’.
f. In addition there are number of pending litigation cases against the Group claiming demand of H3997.36 lakh by retired employees, third parties etc. which the Group is contesting before different Legal Forums / Courts.
The management as well as the legal advisors/consultants are of the opinion that its position will likely to be upheld in the appellate proceedings. The Group also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financial position of the Group.
2. During the year, the Group has incurred loss and hence not provided any liability towards Performance Related Pay payable to the executives (Previous Year H1145.00 lakh) as per terms of DPE guidelines.
3. Lease premium paid for land for mining purposes including payment for Net Present Value (NPV) of forest area paid to forest department is capitalized under the head Prepaid Expenses shown under Note No. 9(d) & 16(g).
4. The lease agreements of Kendadih and Rakha Mining Lease at ICC has been renewed and executed by the Govt of Jharkhand in respect of leasehold lands valid upto 02.06.2023 and 28.08.2021 respectively. In respect of Surda Mining Lease, the lease agreement has expired on 31.03.2020 and the Group has applied for extension of the lease agreement which is under active consideration of the Govt of Jharkhand.
5. The commercial operation of Smelter, Refinery and Sulphuric Acid Plant at Khetri Copper Complex (KCC) were suspended since December 2008. The Group suffered loss on account of impairment of the said plants valued by an independent consultant in earlier years and consequently a total sum of H464.01 lakh was provided in the accounts for impairment loss in compliance with the guidelines of IND AS 36 on “Impairment of Assets” as on 31.03.2020. Total inventory valued H33.21 lakh (Previous Year H33.21 lakh) which remained as process material in the above Plant is included in the Inventory of the Group. The management is of the opinion that such inventories consisting mainly of metal content and having realizable value at least equal to the amount at which they are stated.
6. The title deeds for Freehold and Leasehold Land and Building acquired in respect of Gujarat Copper Project (GCP) with book value of H5578.11 lakh are yet to be executed (Previous year H5859.97 lakh).
Notes to Consolidated Financial Statements (Contd...)
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171
7. At ICC, Pollution Control Plant under Package I & III amounting to H2100.50 lakh have not been capitalized for want of completion of trial / guarantee run as per terms of contract. As a matter of prudence, full provision for the same has been made in the accounts to take care of efflux of time over the years.
8. Confirmation letters of majority of balances under the heads Sundry Creditors, Claims Recoverable, Loans & Advances, Sundry Debtors and Deposits from and with various parties/ Government Departments have been sent but in number of cases such confirmation letters from the parties are yet to be received.
9. During the year, the Group has spent a sum of H331.01 lakh on account of Corporate Social Responsibility (CSR) expenses.
Amount spent during the year on:Sl. No. Particulars in cash In cash Yet to be paid Total(i) Construction/acquisition of any asset - - -(ii) On purposes other than (i)above H331.01 lakh - H331.01 lakh
10. Information related to Micro, Small and Medium Enterprises Development Act, 2006 is disclosed hereunder:a) i) Principal amount remaining unpaid to any supplier at the end of the financial year H961.60 lakh
ii) Interest due on above H248.49 lakhb) Amount of interest paid by the buyer in terms of Section 16 of the Act, along with amount of
payment made beyond the appointed date during the year-
c) Amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the due date during the year) but without adding the interest specified under the Act
H730.36 lakh
d) Amount of interest accrued and remaining unpaid at the end of the financial year H978.85 lakhe) Amount of further interest remaining due and payable even in the succeeding years, until such
date when the interest dues as above are actually paid to the Small enterprise, for the purpose of disallowance as a deductible expenditure under Section 23 of the Act
H NIL
The information has been given of such vendors to the extent they could be identified as “Micro and Small” enterprises on the basis of information available to the Group.
Notes to Consolidated Financial Statements (Contd...)
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11. During the year the Group has written back old liabilities / provisions amounting to H2280.83 lakh (Previous Year H1095.29 lakh) in the accounts, the details of which are as under :-Sl. No. PARTICULARS J in lakh REASONS FOR REVERSAL1. Excess provision on account of shortage, non-
moving & obsolete Stores & Spares written back in respect of MCP – H0.15 lakh, GCP – H66.57 lakh & KCC – H199.82 lakh
266.54 Consequent to physical verification conducted and on reconciliation with book records during the year, the excess provision at the end of the year has been written back to revenue.
2. Excess provision for doubtful debts no longer required is written back in TCP – H41.24 lakh & KCC – H15.33 lakh
56.57 The relevant amount of debts were recovered from the customers/parties and hence the provision for doubtful debts created in earlier years has been written back.
3. Excess provision created for transportation of copper concentrate from KCC to the load port
179.56 The excess provision created for transportation of copper concentrate has been written back
4. Write back of provision against feasibility study of Concentrator Plant at MCP
827.46 The provision against Capital Work in Progress has been written back to Revenue and equivalent amount has also been charged to Revenue resulting NIL impact in the profitability of the Group.
5. Excess provision for interest on MSME is written back in TCP – H0.38 lakh & MCP – H263.63 lakh
264.01 Excess provision for interest on MSME created in earlier years has been written back.
7. Liability for unclaimed EMD, SD & Sundry Creditors for more than 5 years written back at ICC – H42.81 lakh, KCC – H78.15 lakh, MCP – H563.80 lakh & RSOW – H1.93 lakh
686.69 The unclaimed liability for EMD, SD & Sundry Creditors unmoved for more than 5 years has been written back
TOTAL 2280.8312. Management has not become aware of any instance of fraud by the Group or any fraud on the Group by its officers and
employees during the current financial year.
13. The Group has closed / suspended many of its mining operations located at various places, Fertilizer Plant at Khetri in different years due to their uneconomic operations. As per requirement of IND AS 105 on “Non-current Assets Held for Sale and Discontinued Operations” the following information for the year are furnished:
(H in lakh)(Previous year figures in brackets)
MSB GROUP OF MINES
RCP CCP DCP Fertilizer Plant
i) Initial disclosure event (Year of closure)
1997 to 2003 2001 2002 1994 2001
ii) Carrying amount of Assets
No separate records maintained
490.05(503.89)
-(-)
-(-)
No separate records are maintainediii) Liabilities to be settled 137.17
(137.17)73.04
(73.04)3.38
(3.38)iv) Amount of income -
(-)-
(-)-
(-)-
(-)v) Amount of expenses -
(-)34.70*(34.70)
-(-)
vi) Gain on sale of assets (Included in iv above)
-(-)
-(-)
-(-)
-(-)
* This is included in cash generated from operations in the Cash Flow Statement.
Notes to Consolidated Financial Statements (Contd...)
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14. Since the Group is primarily engaged in the business of manufacture and sale of copper products, the same is considered to be the only primary reportable business segment and accordingly has been reported. As the Group operates predominantly within the geographical limits of India, no secondary segment reporting has been considered as per IND AS 108 “Operating Segments”.
15. Sales for the period include FOB value of Export Sales:-2019-20 2018-19
Qty (MT) J in lakh Qty (MT) J in lakhAnode Slime 25.040 1995.90 19.800 2004.64Copper Reverts 265.347 815.91 670.934 2027.10Copper Concentrate (CMT) 10647.339 43317.52 19571.433 80235.59Total 46129.33 84267.33
16. In terms of IND AS 24 on “Related Party Disclosures”: The Group does not have any Advances provided to its Subsidiary and Joint Venture Company as at the year-end
except as is disclosed below:Transactions with Related Party during the year and balance outstanding as on 31.03.2020
H in lakhName of Related Party Nature of
RelationshipType of Transaction Year ended
31.03.20 31.03.19Chhattisgarh Copper Limited (CCL) Subsidiary Investment in shares as on 18.50 18.50
Advances given as on 6.50 6.50
Name of Related Party Nature of Relationship
Type of Transaction Year ended31.03.20 31.03.19
Khanij Bidesh India Limited (KABIL) Joint Venture Investment in shares as on 3.00 -Advances given as on 72.00 -
The remuneration of Key Management Personnel are given below:Particulars Key Management Personnel Total Remuneration
Year ended 2019-20 Year ended 2018-19FUNCTIONAL DIRECTORS
Receiving of Services
1. Sri Arun Kumar Shukla Chairman-cum-Managing Director
12.37(w.e.f. 01.01.2020)
-
2. Sri Santosh Sharma Chairman-cum-Managing Director
44.31(upto 31.12.2019)
66.45
3. Sri K D Diwan Chairman-cum-Managing Director
1.55(Arrear PRP)
21.11(Arrear Gratuity & PRP)
4. Sri Anupam Anand Director (Personnel)
10.55(upto 04.08.2019)
59.01
5. Sri S K Bhattacharya Director (Mining)
93.70(upto 31.12.2019)
49.03
6. Sri S K Bandyopadhyay Director (Finance)
52.41 32.55
7. Sri Arun Kumar Shukla Director (Operations)
35.70(upto 31.12.2019)
21.92
OTHER THAN FUNCTIONAL DIRECTORS8. Sri C S Singhi Company Secretary
51.28 43.80
INDEPENDENT DIRECTORS Smt Simantini Jena – Date of appointment – 17.11.2015 & Re-appointed on 17.11.2018 to 16.11.2019Sri Hemant Mehtani - Date of appointment – 17.11.2015 & Re-appointed on 17.11.2018 to 16.11.2019Sri D R S Chaudhary - Date of appointment – 01.12.2015 & Re-appointed on 01.12.2018 to 30.11.2019Sri Subhash Sharma – Date of appointment – 18.02.2018Sri Pawan Kumar Dhawan – Date of appointment – 22.07.2019Sri Balwinder Singh Canth – Date of appointment – 22.07.2019Sri Kalyansundaram – Date of appointment – 22.07.2019
Notes to Consolidated Financial Statements (Contd...)
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Sl. No. Payment to Independent Directors Year ended 31.03.2020 Year ended 31.03.2019 1. Sitting Fees 12.75 10.35
Balance Outstanding with Key Managerial Personnel as on 31.03.2020Sl. No. Particulars As on 31.03.2020 As on 31.03.2019 1. Amount payable Nil Nil2. Amount receivable Nil Nil
17. In terms of IND AS 33 on “Earning per Share” :(H in lakh)
BASIC DILUTEDProfit / (Loss) After Tax (-) 56948.46
(14526.26)(-) 56948.46
(14526.26)Denominator used: Weighted average number of Equity Shares of H5/- (Previous year H5/- each) outstanding during the period.
925218000(925218000)
925218000(925218000)
Earning Per Share (H) (-) 6.155(1.571)
(-) 6.155(1.571)
18. The Group has accounted for Deferred Tax in accordance with the guidelines of IND AS 12 on “Income Taxes” issued by The Institute of Chartered Accountants of India. The Deferred tax balances are set out below:-
DEFERRED TAX ASSET (NET): - (H in lakh)
Particulars Deferred Tax Asset/ (Liability) as at 01.04.2019
Credit/(Charge)
during 2019-20
Deferred Tax Asset/ (Liability) as at 31.03.2020
Deferred Tax Asset :-Difference between provision made in accounts and claims made as per I. T Act
9243.90 (3379.68) 5864.229243.90 (3379.68) 5864.22
Deferred Tax Liability :-Difference between net book value of depreciable capital assets vis-a-vis WDV as per IT Act
(2998.28) 1083.85 (1914.43)
(2998.28) 1083.85 (1914.43)Deferred Tax Asset (Net) – Recognised in Statement of Profit & Loss
6245.62 (2295.83) 3949.79
Deferred Tax Asset (Net) - Defined Benefit Plan – Recognised in OCI
585.74 755.28 1341.02
Total Deferred Tax Asset (Net) 6831.36 (1540.55) 5290.81
19. PROVISIONS FOR CONTINGENCIES: -(H in lakh)
Particulars Discarded Fixed Assets
Capital WIP & Advance
Mines Development Expenditure
Others TOTAL
Carrying amount as at 01.04.2019
1838.56 4088.49 4664.86 16400.84 26992.75
Amount provided during the year
- - - 27549.44 27549.44
Amounts utilized against provision
- 695.58 - 11675.31 12370.89
Carrying amount as at 31.03.2020
1838.56 3392.91 4664.86 32274.97 42171.30
20. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS IN TERMS OF Ind AS 19 : The Group has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a
gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded through Life Insurance Corporation of India, SBI Life Insurance Co. Ltd. and India First Life Insurance and are managed by separate trust. The Group has also funded through Life Insurance Corporation of India and SBI Life Insurance Co.
Notes to Consolidated Financial Statements (Contd...)
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Ltd towards leave encashment. Expenses recognized in Statement of Profit & Loss and Other Comprehensive Income amounting to H3450.73 lakh in respect of Gratuity, Leave Encashment and Leave Travel Concession which have been provided for as stated below.
The following tables summarize the components of net benefit expense recognized in the Statement of Profit and Loss, Other Comprehensive Income and Mine Development Expenditure and the funded status and amounts recognized in the balance sheet for the respective plans.
(H in lakh)Gratuity
(Funded plan)Leave Encashment (Partially funded
Plan)
Leave Travel Concession
(Non-funded Plan)(i) Changes in Present Value of Obligation
Present Value of obligation as on last valuationCurrent service costInterest costTotal Actuarial gain/loss Benefits PaidPresent value of obligation as on valuation date
(ii) Changes in Fair Value of Plan AssetsFair value of Plan Assets at beginning of periodInterest IncomeEmployer ContributionsBenefits paidReturn on Plan Assets excluding Interest IncomeFair value of Plan Assets at end of measurement period
(iii) Table Showing Reconciliation to Balance SheetFunded StatusFund AssetFund Liability
(iv) Expenses recognized in the Statement of Profit and Loss AccountCurrent service costNet Interest costActuarial (gain)/loss Benefit Cost (Expense Recognized in Statement of Profit/loss)
(v) Other Comprehensive IncomeTotal Actuarial (gain)/lossReturn on Plan Asset, Excluding Interest IncomeBalance at the end of the PeriodNet(Income)/Expense for the Period Recognized in OCI
(vi) Table Showing Plan AssumptionsDiscount RateExpected Return on Plan AssetRate of Compensation Increase (Salary Inflation) etcAverage expected future service (Remaining working Life)Mortality TableSuperannuation at age-MaleSuperannuation at age-FemaleEarly Retirement & Disablement (All Causes Combined)
13501.90813.77709.06
3000.955353.13
12672.55
21811.521512.30
-5353.13
-
17970.69
5298.1417970.6912672.55
813.77(803.24)
-10.53
3000.95-
3000.953000.95
6.55% p.a.7.50%,7.00%,6.50%
6.00% p.a.10 years
IALM 2006-2008 ULTIMATE
60 years60 years1% p.a.
12901.17994.66752.32
(1190.91)2830.70
10626.54
3334.27246.46
2830.262830.70
-
3580.29
(7046.24)3580.30
10626.54
994.66505.86
(1190.91)309.61
----
6.55% p.a.7.00%,7.50%
6.00% p.a.10 years
IALM 2006-2008 ULTIMATE
60 years60 years1% p.a.
171.93
129.64103.54198.03
129.64129.64
6.55% p.a.--
10 yearsIALM 2006-2008
ULTIMATE60 years60 years1% p.a.
Notes to Consolidated Financial Statements (Contd...)
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176
The details of the plan assets as on 31.03.2020 towards gratuity & leave encashment are as follows: in H lakh
Investment in Life Insurance Corporation of India 2778.47Investment in SBI Life Insurance Co. Ltd 18154.63Investment in India First Life Insurance 615.83Fund with Gratuity Trust Savings Bank Accounts 2.06Total 21550.99
Actual Return on Plan Assets during the year - J 1758.76 lakh.
The estimates of future salary increases were considered in actuarial valuation after taking into account inflation, seniority, promotion and other relevant factors. Further, the expected return on plan assets is determined considering several applicable factors mainly the composition of plan assets held, assessed risk of asset management and historical returns from plan assets.
21. Financial Instrument1. Derivatives not designated as hedging instruments
The Group uses Commodity Futures Contracts to manage its commodity price risk . The Commodity Futures Contracts are not designated as hedging instrumnets and are entered into for periods consistent with commodity price risk exposure of the underlying transactions, generally from one to four months. However in the year FY 19-20, the Group has not entered into any Commodity Futures Contract.The Group uses foreign exchange forward contracts to manage some of its transaction exposures. The foreign exchange forward contracts are not designated as cash flow hedges and are entered into for periods consistent with foreign currency exposure of the underlying transactions, generally from one to four months.
Commodity price riskThe Group purchases copper blister/ anode on an ongoing basis for its operating activities in its Gujarat Copper Project (GCP) plant for the production of cathode. To hedge itself against the volatility in LME copper prices in the international market has led to the decision to enter into commodity future contracts. However in the year FY 19-20, the Group has not purchased any such copper blister/ anode for its plant in GCP.These contracts, which commenced in August 2016, are expected to reduce the volatility attributable to price fluctuations of copper. Hedging the price volatility of copper purchases is in accordance with the Risk Management Policy approved by the Board of Directors. The hedging relationships are for a period between 1 and 4 months based on existing purchase agreements. The Group designated only the spot-to-spot movement of the entire commodity purchase price as the hedged risk. It has been decided by the Group not to follow the hedge accounting for these instruments. As at 31 March 2020, the fair value of the open position of commodity future contracts is nil.
2. Financial Instruments by CategoriesThe carrying value and fair value of financial instruments by categories were as follows:Set out below, is a comparison by class of the carrying amounts and fair value of the Group’s financial instruments, other than those with carrying amounts that are reasonable approximations of fair values:
(Amount in H lakh)Particulars Total carrying
value as at March 31, 2020
Total carrying value as at
March 31, 2019
Fair Value as at March
31, 2020
Fair Value as at March
31, 2019Financial Assets at FV through Statement of Profit & LossMutual Funds 7.84 7.84 9.48 8.85Derivatives not designated as hedgesFuture Contract Receivable on commodity - - - - Total of Financial Assets 7.84 7.84 9.48 8.85Financial LiabilitiesDerivatives not designated as hedgesForward Cover Contract Liability - - - -Total of Financial Liabilities 0.00 0.00 0.00 0.00
Notes to Consolidated Financial Statements (Contd...)
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177
3. The Management considered the Service fees of Rs 15 lakh paid on the Exim Bank Term loan amounting to H30000 lakh drawn on 29.05.2018 as immaterial, as the amount of service fee was only 0.019% of the Turnover (FY 2019-20) of the Group and hence the same was not considered as a transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further, the Management assessed that for the purpose of IND AS 109, the carrying value of loan is considered as its fair value as no loan could be provided at a rate lower that the rate of interest of Exim Bank loan for similar terms and conditions of the loan at that point of time.
Similarly, the Management considered the total of Upfront fees & Other charges of Rs 245.33 lakh paid on the SBI ECB loan amounting to H17734.75 lakh drawn during July 2018 to January 2019 as immaterial, as the amount of such fees/charges was only 0.305% of the Turnover (FY 2019-20) of the Group and hence the same was not considered as a transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further, the Management assessed that for the purpose of IND AS 109, the carrying value of loan is considered as its fair value as no loan could be provided at a rate lower that the rate of interest of SBI ECB loan for similar terms and conditions of the loan at that point of time.
The Management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:
The Group enters into derivative financial instruments with various counterparties, principally with financial institutions having Investment grade credit ratings. Foreign exchange forward contracts and commodity futures contracts are valued using valuation techniques, which employs the use of market observable inputs. The most frequently applied valuation techniques include forward pricing .
4. Fair Value Hierarchy● Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) in active
markets.● Level 2 - Level 2 hierarchy includes financial instruments measured using inputs other than quoted prices
included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
● Level 3 - Level 3 hierarchy includes financial instruments measured using inputs that are not based on observable market data (unobservable inputs).
The following table presents fair value hierarchy of assets and liabilities measured at fair value
(Amount in H lakh)Particulars Date of Valuation Level 1 Level 2 Level 3 TotalFinancial Assets at FV through Statement of Profit & LossNon-derivative financial assets Mutual funds 31/Mar/2020 9.48 - - 9.48Derivative financial assets Future Contract Receivable on commodity 31/Mar/2020 - - - - Liabilities measured at fair value: Derivative financial liabilitiesForward Cover Contract Liability 31/Mar/2020 - - - -Assets measured at FV through OCI 31/Mar/2020 - - - -
Notes to Consolidated Financial Statements (Contd...)
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(Amount in H lakh)Particulars Date of Valuation Level 1 Level 2 Level 3 TotalFinancial Assets at FV through Statement of Profit & LossNon-derivative financial assets Mutual funds 31/Mar/2019 8.85 - - 8.85Derivative financial assets Future Contract Receivable on commodity 31/Mar/2019 - - - - Liabilities measured at fair value: Derivative financial liabilitiesForward Cover Contract Liability 31/Mar/2019 - - - - Assets measured at FV through OCI 31/Mar/2019 - - - -
5. Financial Risk ManagementFinancial risk factorsThe Group's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Group's primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.Risk Exposure arising from Measurement ManagementMarket risk- Foreign Exchange
Future commercial transactions, Recognised financial assets and financial liabilities
Sensitivity analysis
Forward foreign exchange contracts and natural hedge as sales are also demonstrated in foreign exchange.
Market-Commodity Price Risk
Purchase of Copper Price Sensitivity Commodity Futures Contract
Credit risk Trade receivables Ageing analysis Sales are mainly done against Advance or Letters of Credit
Liquidity risk Borrowings and other liabilities Rolling cash flow forecasts
Cash flow management
a) Market Risk i) Foreign Currency RiskThe Group operates at international level which exposes the Group to foreign currency risk arising from foriegn currency transaction primarily from Imports, exports and foreign currency borrowing. Foreign currency risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency other than INR as on reporting date.
(Amount in J lakh as of March 31, 2020)Particulars J In lakhCash & cash equivalents -Trade Receivables 7114.00Trade Payables -Loans (55664.08)Others (if any) -Net Assets/ (-) Liabilities (48550.08)
(Amount in J lakh as of March 31,2019)Particulars J In lakhCash & cash equivalents -Trade Receivables 32203.00Trade Payables -Loans (68007.12)Others (if any) -Net Assets/ (-) Liabilities (35804.12)
Sensitivity
Notes to Consolidated Financial Statements (Contd...)
F-125
179
The sensitivity of profit or loss to changes in exchange rate arises mainly from foreign currency denominated financial instrument. Particulars Impact on profit before tax
March 31, 2020 March 31, 2019Increase by 5% 2,783.20 3,400.36 Decrease by 5 % (2,783.20) (3,400.36)
ii) Commodity Price RiskThe Group's exposure to Commodity price from copper price fluctuation in international market does not arise as the Group hedges all its imports through Future contracts at LME
b) Credit RiskCredit risk refers to the risk of default on its obligation by the Debtors resulting in a financial loss. The Group sells majority of its products either against Advance from Customers or Leters of Credit. Accordingly, credit risk from Trade eceivables has not been considered as credit risk.
Credit risk exposureAn analysis of age of Trade receivables at each reporting date is summarized as follows:
(Amount in H lakh)Particulars 31-Mar-20 31-Mar-19
Gross GrossNot past due - -Past not more than six months 5712.45 29162.70Past due more than six months but not more than one year 553.20 2247.62More than one year 2910.21 5687.28Total 9175.86 37097.60Less Allowances for Bad & Doubtful Debts 886.51 942.77Net Debtors 8289.35 36154.83
Customer credit risk is managed by each business unit subject to the Group's established Marketing policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored and any shipments to major customers are generally covered by letters of credit or other forms of credit insurance.
The maximum exposure to credit risk at the reporting date is H886.51 lakh for which full provision has been made in the accounts as disclosed in Note No 12.
Other financial assetsCredit risk relating to cash and cash equivalents is considered negligible because our counterparties are scheduled banks. We consider the credit quality of Term deposits with such banks as good as these banks are under the regulartory framework of Reserve Bank of India. We review these banking relationships on an ongoing basis.
c) Liquidity RiskOur liquidity needs are monitored on the basis of monthly and yearly projections. The Group's principal sources of liquidity are cash and cash equivalents and cash generated from operations.
We manage our liquidity needs by continuously monitoring cash inflows and by striving to maintain adequate cash and cash equivalents. Net cash requirements are compared to available cash in order to determine any shortfall.
Short term liquidity requirements consists mainly of Loans, Sundry creditors, Expense payable, Employee dues arising during the normal course of business as of each reporting date. We strive to maintain a sufficient balance in cash and cash equivalents to meet our short term liquidity requirements.
The table below provides details regarding the contractual maturities of financial liabilities. The table has been drawn up based on the undisclosed cash flows of financial liabilities based on the earliest date on which the Group can be required to pay.
Notes to Consolidated Financial Statements (Contd...)
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(Amount in H lakh as of March 31, 2020)Particulars On
DemandLess than 3
months3 months to 1 year
1-3 years 3-5 years 5-7 years
Total
Short term borrowings (cash credit)
13603.41 - - - - - 13603.41
Short term borrowings (Others)
- 36800.00 19500.00 - - - 56300.00
Long Term Borrowings - 2175.00 10515.79 61548.29 12225.00 - 86464.08Total 13603.41 38975.00 30015.79 61548.29 12225.00 0.00 156367.49
(Amount in H lakh as of March 31, 2019)Particulars On
DemandLess than 3
months3 months to 1 year
1-3 years 3-5 years 5-7 years Total
Short term borrowings (cash credit)
16503.81 - - - - - 16503.81
Short term borrowings (Others)
- 22702.84 - - - - 22702.84
Long Term Borrowings - 756.51 9982.04 32467.53 23147.58 1450.62 67804.28Total 16503.81 23459.35 9982.04 32467.53 23,147.58 1,450.62 107010.93
NB: 1. Under RBI Notification No. RBI/2019-20/186 dated 27.03.2020 the scheduling of loan instalments has been given as per approval received from banks under COVID-19- Regulatory Package.
2. Under RBI Notification No. RBI/2019-20/244 dated 23.05.2020, the company has applied for deferral of loan instalments amounting to Rs 25350.00 lakh for a period of 3 months. The approvals are in process and hence effect of the same is not considered above. This is as per COVID-19- Regulatory Package.
6. Capital Management For the purpose of the Group's capital management, capital includes issued equity capital and all other equity
reserves attributable to the Group. The primary objective of the Group's capital management is to maximize the shareholder value.
22. With effect from April, 2019, the Group has adopted Ind AS 116. However, since the Group has no lease liabilities at present, Ind AS 116 has no financial impact on the accounts of the Group during the current financial year.
23. The physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all the units (ICC, KCC, MCP, TCP & GCP) at the end of the current year by a duly approved committee. Although, work orders were issued to independent agencies in all the units for carrying out physical stock verification of WIP and Finished Goods at the end of the financial year, due to PAN INDIA lockdown for COVID 19 pandemic the same could not to be completed at KCC & ICC since the work orders are issued to out-station parties through tendering process. However, the same have been completed in TCP,GCP & MCP since work orders are awarded to local firms in the said units.
In respect of stores and spares, physical verification has been conducted by the external agencies, located in and around the project site, in all the units during the year. Shortages/ (Excesses) identified on such physical verification have been duly adjusted in the books of accounts.
24. The physical verification of fixed assets which is required to be conducted every year so that all the units/offices are covered once in a block of three years interval. During the year, physical verification of fixed assets is to be conducted by external agencies in ICC, RCP, MCP & GCP. Although, work orders were issued to independent agencies, the work is not completed due to PAN INDIA lockdown for COVID 19 pandemic in ICC & RCP unit since the work orders are issued to outstation parties. However, the same has been completed at MCP & GCP unit.
Notes to Consolidated Financial Statements (Contd...)
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25. INTEREST IN OTHER ENTITIES a) Subsidiary
Name of Entity Nature of relationship
Proportion of shareholding
Country of incorporation
Chhattisgarh Copper Limited (CCL) Subsidiary 74% India
b) Associate/Joint VentureName of Entity Nature of
relationshipProportion of shareholding
Country of incorporation
Khanij Bidesh India Limited (KABIL) Joint Venture 30% India
(i) Commitments and contingent liabilities in respect of Associate/Joint Venture – NIL
(c) Summarized financial information for Associate/Joint Venture(H)
Summarized Balance Sheet KABIL31.03.2020
Cash & Cash Equivalents 1,58,39,059Total Assets 1,58,39,059Equity Share Capital 2,50,00,000Other Equity (92,13,841)Other Current Liabilities 52,900Total Equity and Liabilities 1,58,39,059
(H)Summarized Statement of Profit and loss KABIL
31.03.2020Total Income NilOther Expenses 92,13,841Total Expenses 92,13,841Profit/(Loss) Before Tax for the period (92,13,841)Profit/(Loss) After Tax for the period (92,13,841)
26. The income tax expense for the year can be reconciled to the accounting profit as follows :H in lakh
Year ended 31.03.2020 Year ended 31.03.2019Profit / (Loss) before Tax (53756.84) 23009.85Income Tax expense calculated at 25.168% (34.944%) - 8040.56Effect of Deferred Tax balances due to the change in income tax rates
1534.21 (60.05)
Income Tax effect of earlier years 842.18 472.18Others (net) 761.62 8.33Income Tax expense recognized in profit or loss 3138.01 8461.02
The Group elected to exercise the option permitted under Section 115BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment Act, 2019). Accordingly the Group has recognised Provision for Income Tax for the year ended 31.03.2020 and remeasured its deferred tax assets/(liabilities) basis the rates prescribed in the said section.
Notes to Consolidated Financial Statements (Contd...)
F-128
182
27. During the year Nil (Previous year 65,000 nos.) equity shares of face value H10/- each have been issued to Chattisgarh Mineral Development Corporation Limited by Chattisgarh Copper Limited for providing consultancy services and no consideration has been received in cash. This represents 26% of the share capital of Chhattisgarh Copper Limited.
28. The value of assets, other than fixed assets and non-current assets, have realizable value at least equal to the amount at which they are stated.
29. Gujarat Copper Project of the Group consists of three units namely, Anode furnace (Smelter), Refinery and Kaldo Furnace having aggregate book value of H24536.34 lakh as at March 31,2020. The Anode Furnace and Refinery unit has been commissioned in October 2016 while Kaldo unit is commissioned on 25.05.2020. Since commissioning, the Anode Furnace and Refinery units are being operated at a sub optimal level for want of feed stock. GCP being a secondary smelter, the feed stock are copper scrap, copper blister, liberator cathode etc. The Group has not been able to source these materials in the required quantity resulting in suboptimal operations. Management is exploring various alternative source to make the plant operative.
30. Copper ore tailing (COT) beneficiation plant was set up at MCP unit for extraction of valuable minerals and metals from copper ore tails with a capacity of 10000 tonnes per day (TPD) at an estimated cost of H20000 lakh. The intermittent trial run failed on number of occasions (chockage/ spillage, stoppages, cleaning etc) and the quality and quantity of products achieved at various stages are not as per the parameters envisaged in contract agreement. A preliminary notice was issued to the party to complete the project and commission the same. The party agreed to commission the plant, but the progress of the work at site was stopped due to lockdown for COVID-19 pandemic. Under this circumstances, the Group thinks it prudent to extend the timeline upto 31.08.2020 for supply, erection of the thickener and commission of the plant.
31. During the year, a Joint Venture Company (JVC) named Khanij Bidesh India Limited (KABIL) was formed on 01.08.2019 among National Aluminium Company (NALCO), Hindustan Copper Limited (HCL) and Mineral Exploration Corporation Limited (MECL) to identify, explore, acquire, develop, process primarily strategic minerals overseas for supply to India for meeting domestic requirements and for sale to any other countries for commercial use. HCL holds 30% equity in JVC. HCL has invested 30,000 equity shares of H10.00 each totaling to H3.00 lakh. Further, an advance of H72.00 lakh is lying in the books of accounts at the year end for allotment of 7,20,000 shares of H10.00 each against which a provision of H27.64 lakh has been made towards share of loss in Joint Venture.
32. In MCP unit, there is Mill Scat of 2379816.031 MT (estimated quantity) containing metal content of 4112.322 CMT (estimated quantity) which is generated during the milling process. The Scat quantity had been stored over the years of production and needs to be reprocessed for recovering the active metal with the involvement of secondary crushing and grinding. The expected recovery from Scat having average grade of 0.18% copper would be around 75 to 80%. Further, the scope for beneficiation of the existing Mill Scat metal through processes and treatment is not possible due to non-availability of existing matching concentrator plant. Since the Mill Scat of 2379816.031 MT (estimated quantity) (4112.322 CMT) have low grade of copper percentage and do not have any realisable value at present, the in-house team of MCP considers that it is prudent to make a provision amounting to H12010.05 lakh in the books of accounts. Also the in-house team of the unit considers that it is prudent to make a provision for lean ore of 2567.255 CMT (estimated quantity), having grade of 0.29%, amounting to H6321.75 lakh since the entire quantity of lean ore cannot be processed for production of concentrate independently without mixing with crusher ore having high grade in order to achieve the average cut-off grade. Based on all the above aspects, full provision for Mill Scat and Lean Ore amounting to H18331.80 lakh (H12010.05 lakh + H6321.75 lakh) has been made in the current year.
KCC unit have also reconciled the closing stock of Work in Progress & Finished Goods and identified the differences in respect of copper content as 323.987 CMT valuing H1126.34 lakh (considering stock valuation rate as on 31.03.2020) arising out of mismatch of copper content based on Delivery Order quantity and actual copper content as per R&D report for the period 2016-17 to 2019-20 and also identified the differences in respect of copper content as 481.262 CMT valuing H1673.11 lakh (considering stock valuation rate as on 31.03.2020) arising out of reconciliation of difference of handling losses during dispatch of copper concentrate from discharge point to bedding building for storage through loader, loss through tyres of loading equipments during dispatch and to and fro movement of trucks till the final weighment clearance for the period 2009-10 to 2019-20 which are duly checked and certified by an independent Chartered Accountant firm. Moreover, in-house team of KCC has identified that 850.000 CMT of copper concentrate
Notes to Consolidated Financial Statements (Contd...)
F-129
183
valuing H2955.04 lakh (considering stock valuation rate as on 31.03.2020) is lying at the bottom of bedding building which is mixed with floor concrete, impurities, stones etc. as well as partially oxidized and there is also heavy lump formation over a period of several years which is not suitable for pyro-metallurgical plant, making it unrealizable and hence the same is being treated as dead stock. Based on all the above aspects, 1655.249 CMT (323.987 CMT + 481.262 CMT + 850.000 CMT) valuing H5754.49 lakh (H1126.34 lakh + H1673.11 lakh + H2955.04 lakh) has been written off during the current year as one-time adjustment of closing stock.
ICC unit have also reconciled the closing stock of Work in Progress & Finished Goods and identified the differences in respect of copper content as 3837.429 CMT valuing H9953.90 lakh (considering stock valuation rate as on 31.03.2020) against receipt of copper concentrate from MCP arising out of mismatch of copper content based on provisional data of MCP and actual copper content as per analysis done at ICC for the period 2008-09 to 2019-20 and also reconciled the differences in respect of copper content as 3149.000 CMT valuing H8168.20 lakh (considering stock valuation rate as on 31.03.2020) being the difference of average metal loss considered in inventory valuation vis-à-vis actual average metal loss in Granulated Copper Dump Slag for the period 2008-09 to 2019-20 which are duly checked and certified by an independent CA firm. Moreover, in-house team of ICC has identified 706.965 CMT of copper concentrate valuing H1833.80 lakh (considering stock valuation rate as on 31.03.2020) mixed with impurities as well as partially oxidized over a period of several years, making it unrealizable and hence the same is being treated as dead stock. Based on all the above aspects, 7693.394 CMT (3837.429 CMT + 3149.000 CMT + 706.965 CMT) valuing H19955.90 lakh (H9953.90 lakh + H8168.20 lakh + H1833.80 lakh) has been written off during the current year as one-time adjustment of closing stock.
Based on all the above facts, the closing stock as on 31.03.2020 is reduced by H25710.39 lakh (H5754.49 lakh + H19955.90 lakh) due to one-time write off of closing stock of KCC & ICC respectively. Further provision amounting to H18331.80 lakh has been made against Mill Scat and Lean Ore at MCP, which are not presently in use and have no realisable value at present.
The Group has modified the Standard Operating Procedure (SOP) on Inventory Management, duly verified and certified by an independent CA firm, addressing all the above issues to strengthen the reconciliation of inventory as an ongoing activity.
33. Consequent upon the Judgment of Common Cause dated 02.08.2017, which is applicable only to the mining leases of iron and manganese ore, passed by the Apex court in the case of Common Cause Vs UOI and others, a demand of H4353.78 lakh was raised by the District Mining Officer of Jamshedpur for running the Surda mine without valid environment clearance (EC) although Surda mine has a valid mining lease, forest clearance and it has adhered to the terms of approved mining plan and it was working on valid Consent to Operate. Based on the Revision Application filed by the Group, the Revisional Authority of the Ministry of Mines, after hearing at length both parties had issued specific direction against the District Mining Officer (DMO) not to take any coercive measures in terms of recovery of the said demand. On revision of demand from H4353.78 lakh to H12690.49 lakh by the office of the District Mining Officer and subsequently revised to H92940.06 lakh by the State Government, the Group again appealed before the Revisional Authority and hearing was held on 14.11.2019 and interim stay is granted by the Revisional Authority till the next date of hearing. Since at present mining leases of copper ore are not included under Common Cause Judgement, the Management, based on the legal opinion, is of the view that the same has not to be shown as Contingent Liability as on 31.03.2020.
34. The spread of Covid 19 has affected the business operations of the Group in all the units due to lock down declared by the Government. The Group has taken various measures in consonance with the Government advisories to contain the pandemic, which included closing of mining and operational activities across the Group. However, Government has allowed to resume its operation in all the units during April 2020 & May 2020.
Given the uncertainty of quick turnaround to normalcy, post lifting of the closure, the Group has carried out a comprehensive assessment of possible impact on its business operations, financial assets, contractual obligations and its overall liquidity position, based on the internal and external sources of information and application of reasonable estimates. Management will continue to monitor any material changes arising due to the impact of this pandemic on financial and operational performance of the Group and take necessary measures to address the situation.
35. The previous year’s figures have been regrouped / rearranged, wherever necessary.
Notes to Consolidated Financial Statements (Contd...)
F-130
184
39.G
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Notes to Consolidated Financial Statements (Contd...)
F-131
185
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9
Notes to Consolidated Financial Statements (Contd...)
F-132
186
Additional information forming part of accounts for year ended March 31, 202039.2 Raw materials consumed
Quantity ValueYear ended2019-2020
Year ended2018-2019
Year ended2019-2020
Year ended2018-2019
CMT CMT (J in lakh) (J in lakh)Concentrate own production 5948 14549 16060.14 33438.35 Concentrate excluding own production - - - -Cathode - - - -39.3 Imported and indigenous raw materials, stores spare parts and components consumed(as certified by the management)RAW MATERIALS: % %Imported 95 92 461.39 5741.43 Indigenous 5 8 21.90 528.14
100.00 100.00 483.29 6269.57 STORES & SPARES:(Direct and Stores & Spares booked in Mine Development, Shut-down and Fuel)Imported 1 4 157.95 882.50Indigenous 99 96 16298.30 20448.64
100.00 100.00 16456.25 21331.14
39.4 C.I.F. Value of importsRaw Material 461.39 5741.43Components, spare parts 226.60 1444.00and stores
687.99 7185.43
39.5 Expenditure in foreign currencyTravelling 67.84 85.64Others 753.39 7185.52
821.23 7271.16
39.6 Earning in foreign ExchangExport of Goods (FOB) 46129.33 84267.33
46129.33 84267.33
39.7 Payment to Whole Time DirectorsSalaries and allowances 153.84 186.11Company's contribution to provident and other funds 13.18 13.99Re-imbursement of Medical expenses 1.06 0.53Leave Encashment 32.83 13.23Gratuity 20.00 10.00Other Benefits 29.68 26.21
250.59 250.07
Note :In addition, the Whole Time Directors are allowed the use of company car for private purpose and have been provided with residential accomodation as per terms of their appointment/Government guidelines
Notes to Consolidated Financial Statements (Contd...)
F-133
62
ToThe Members ofHindustan Copper Limited
Report on the Audit of the Standalone Financial Statements
Opinion
We have audited the accompanying standalone financial statements of Hindustan Copper Limited (“the Company”),which comprise the Balance Sheet as at March 31, 2019 and the Statement of Profit and Loss (including OtherComprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on thatdate, and notes to the standalone financial statements including a summary of the significant accounting policies andother explanatory information (hereinafter referred to as “the standalone financial statements”).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalonefinancial statements give the information required by the Companies Act, 2013 in the manner so required and give atrue and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act readwith the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principlesgenerally accepted in India, of the state of affairs of the Company as at March 31, 2019, and its profit (including OtherComprehensive Income), changes in equity and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing (SAs)specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Standalone Financial Statements section of our report. Weare independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountantsof India (ICAI) together with the ethical requirements that are relevant to our audit of the standalone financial statementsunder the provisions of the Companies Act, 2013 and the Rules made thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.
Emphasis of Matters
We draw attention to the following matters:
a) Note No.38 Para 1 “Contingent liabilities” of the accompanying standalone financial statements which describes theuncertainty related to the outcome of the lawsuits filed and demand raised against the company by various partiesand Government authorities;
b) Note No.38 Para 4 & 6 of the accompanying standalone financial statements which states that the title deeds,conveyance deeds etc. in respect of certain freehold lands at Indian Copper Complex acquired through nationalizationin accordance with Indian Copper Corporation (Acquisition of Undertaking) Act, 1972 are not in possession of thecompany and title deeds in some locations at Gujarat Copper Project, Delhi and Jaipur office are yet to be executedin favor of the Company. Title deeds for leasehold and freehold lands or other evidences of title are pending to bereconciled with financial records.
c) Note No.38 Para 8 of the accompanying standalone financial statements wherein,balances under the head ClaimsRecoverable, Loans & Advances, Deposits with various parties and certain balances of receivables, payables andother current liabilities have not been confirmed as at March 31, 2019.Consequential impact upon receipt of suchconfirmation/reconciliation/adjustment of such balances, if any is not ascertainable at this stage;
d) We refer Note No. 38 Para 30 of the accompanying standalone financial statements regarding Gujarat Copper Projectvaluing 27214.50 lakh where the company has not been able to operate profitably due to various constraint, viabilityassessment needs to be done to evaluate and adjust for possible impairment loss, if any.Our opinion is not modified in respect of these matters.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of thestandalone financial statements of the current period. These matters were addressed in the context of our audit of the
INDEPENDENT AUDITOR’S REPORT
F-134
63
standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinionon these matters. We have determined the matters described below to be the key audit matters to be communicated inour report.
Assessment of Stripping Ratio and charging ofoverburden expenditure during productionstage of surface mines to Mines DevelopmentExpenditure and Profit and Loss account
Referred in Note No.2 (11) and Note No.9 of theStandalone Financial Statements.
Assessment of Stripping Ratio is technicallyestimated initially at the beginning of the Mines andlater on periodically assessed for which no standardswritten policy are there. Normally review donewithin a period of 3 to 4 years as informed to us.
In case of Open cast mines, the expenditure onremoval of waste and overburden, is capitalizedand the same is depleted in relation to actual oreproduction during the year on the stripping ratiowhich is re-assessed periodically based on theestimated ore reserve as well as the quantity ofwaste excavation in respect of open cast mines.
Assessment of Stripping ratio is uniquely appliedunder the Mining industries which involvessignificant judgment to determine the ratio and thatalso keep on change from time to time. This ratiohas been changed subsequently based on the actualoutput of overburden and Ore exposed during theproduction stage of the mines.
We have identified this area as key audit matterdue to its nature as industry specific andinvolvement of technical assumptions andjudgments in calculation of stripping ratio. Furtherit has a material impact on the financial statementsbeing this year company has amortized ` 20074.56lakh (PY:- ` 11970.45 lakh) as Mine developmentexpenditure for open cast mines.
Impact of Change in Accounting Policy
During the year company has changed its accountingpolicy in respect of provision for Mines closureexpenditure as per the regulatory require-ments.Refer Note No.38 (25) of the standalonefinancial statements
We have considered this as Key Audit Matter as non-implementation of the change in accounting policyin the system may have significant impact on thefinancial statements.
Principal Audit Procedures
Our audit approach consisted testing of the designand operating effectiveness of the internal controlsand substantive testing as follows:
� We went through the current status of the miningat different mines
� We discussed with the management about thestripping procedure adopted in the industry aswell practice followed by the company
� Procedure followed by the management towardsIdentification of expenditures incurred in surfacemines during production stage
� Understanding the computation of Stripping ratioinitially made and documents made available tous.
� We have checked the stripping ratio to be chargedunder amortization for mine developmentexpenditure for balance period of mines
� Discussion with the core technical team involvein this process
� Reliance is placed on the representations of themanagement.
Principal Audit Procedures
� We have discussed the change in accounting policywith the management and
� Verify the implementation of the change in thebooks of accounts.
Key Audit Matters Auditor’s ResponseSl.No.
1
INDEPENDENT AUDITOR’S REPORT (Contd.)
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Information Other than the Standalone Financial Statements and Auditor's Report ThereonThe Company's Board of Directors is responsible for the other information. The other information comprises the informationincluded in theReport of the Board of Directors, Management Discussion and Analysis Report, Report on CSR activities,Business Responsibility Report, Corporate Governance Report and other annexure to Directors Report includingShareholder's Information, but does not include the standalone financial statements and our auditor's report thereon.Our opinion on the standalone financial statements does not cover the other information and we do not express any formof assurance conclusion thereon.In connection with our audit of the standalone financial statements, our responsibility is to read the other informationand, in doing so, consider whether the other information is materially inconsistent with the standalone financialstatements or our knowledge obtained in the audit or otherwise appears to be materially misstated.If, based on the work we have performed, we conclude that there is a material misstatement of this other information; weare required to report that fact. We have nothing to report in this regard.Responsibility of Management and Those Charged with Governance for the Standalone Financial StatementsThe Company's Board of Directors is responsible for the matters stated in section 134(5) of the Companies Act, 2013("The Act") with respect to the preparation of these standalone financial statements that give a true and fair viewof the financial position, financial performance, changes in equity and cash flows of the Company in accordance withthe accounting principles generally accepted in India, including the accounting Standards specified under Section 133of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with theprovisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities; selection and application of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that wereoperating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparationand presentation of the standalone financial statements that give a true and fair view and are free from materialmisstatement, whether due to fraud or error.In preparing the standalone financial statements, the Board of Directors is responsible for assessing the Company'sability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the goingconcern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations,or has no realistic alternative but to do so.Those Board of Directors are also responsible for overseeing the Company's financial reporting process.Auditor's Responsibilities for the Audit of the Standalone Financial StatementsOur objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are freefrom material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions ofusers taken on the basis of these standalone financial statements.As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticismthroughout the audit. We also:� Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient andappropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraudis higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.
� Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriatein the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whetherthe Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
� Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and relateddisclosures made by management.
� Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the auditevidence obtained, whether a material uncertainty exists related to events or conditions that may cast significantdoubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, weare required to draw attention in our auditor's report to the related disclosures in the standalone financial statementsor, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtainedup to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continueas a going concern.
INDEPENDENT AUDITOR’S REPORT (Contd.)
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� Evaluate the overall presentation, structure and content of the standalone financial statements, including thedisclosures, and whether the standalone financial statements represent the underlying transactions and events in amanner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing ofthe audit and significant audit findings, including any significant deficiencies in internal control that we identify duringour audit.We also provide those charged with governance with a statement that we have complied with relevant ethical requirementsregarding independence, and to communicate with them all relationships and other matters that may reasonably bethought to bear on our independence, and where applicable, related safeguards.From the matters communicated with those charged with governance, we determine those matters that were of mostsignificance in the audit of the standalone financial statements of the current period and are therefore the key auditmatters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about thematter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our reportbecause the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits ofsuch communication.Report on Other Legal and Regulatory Requirements1) As required by the Companies (Auditor's Report) Order, 2016 ("the Order"), issued by the Central Government of
India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the “Annexure-A”, astatement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.
2) As required by Section 143(3) of the Act, we report that:a) We have sought and obtained all the information and explanations which to the best of our knowledge and
belief were necessary for the purposes of our audit except as reported in Clause (b) & (c) of the "Emphasis ofMatters" paragraph above;
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appearsfrom our examination of those books.
c) The Balance Sheet, the Statement of Profit and Loss including Other Comprehensive Income, Statement ofChanges in Equity and the Statement of Cash Flow dealt with by this Report are in agreement with the relevantbooks of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified underSection 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015 as amended.
e) In pursuance to the Notification No. G.S.R 463(E) dated 05-06-2015 issued by the Ministry of Corporate affairs,Section 164(2) of the Companies Act, 2013 pertaining to disqualification of Directors, is not applicable to theGovernment Company.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and theoperating effectiveness of such controls, refer to our separate Report in "Annexure-B";
g) With respect to the other matters to be included in the Auditors' Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according tothe explanations given to us:
i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financialstatements.-[Refer Note No.38 (1) to the accompanying standalone financial statements];
ii. The Company did not have any long-term contracts including derivative contracts for which there were any materialforeseeable losses;
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund bythe Company.
3) As required by Section 143(5) of the Act, we give in the "Annexure-C", a statement on the matters specified in theDirections issued by the Comptroller and Auditor General of India in respect of the Company.
For Chaturvedi & Co.Chartered Accountants
(Firm's Registration No.302137E)
CA S.C.ChaturvediPartner
(Membership No. 012705)Place: New DelhiDate: May 28, 2019
INDEPENDENT AUDITOR’S REPORT (Contd.)
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[Referred to in Paragraph 1 of “Report on Other Legal and Regulatory Requirements” section of ourIndependent Auditor’s Report]
(i) In respect of its fixed assets:
(a) The Company has maintained proper records showing full particulars, including quantitative details and situationof fixedassets. Further asset identification numbers and codifications of some movable tangible assets alongwith make/model no., needs to be assigned to the assets and to be updated in fixed assets register. Locationdetails and area of freehold and leasehold land held by the Company at different locations needs to be updatedin the fixed asset register to the extent of holding and location of the land and further needs to be reconciledwith the financial records. Further quantity in case of few old assets along with their description, particulars ofdepreciation, amortization or impairment has also not been properly disclosed in the fixed asset register.
(b) According to the information and explanations given to us, the fixed assets of the Company have been physicallyverified by the management at reasonable intervals in a phased manner so as to generally cover all the assetsonce in a block of three years. As per the phased programme, during the year, the Company has conducted thephysical verification at Taloja Copper Project and Regional Sales office (West), which in our opinion, is reasonablehaving regard to the size of the Company and nature of its assets. Discrepancies noticed on such verificationwhich were not material as per Company, pending for adjustment/settlement in the books of account. Theprocess of physical verification at Plant/office should be further improved by having the list of assets with theirnumbers and amount as per Fixed Asset Register duly mapped with physically assets verified and also havinga well defined manual of physical verification especially looking into the various locations, quantum of assetsphysically available at each of the Plant/office locations.
(c) According to the information and explanations given to us and on the basis of our examination of the records ofthe Company, title deeds or lease deeds of leasehold land measuring 90.30 acres amounting of ` 374.93 lakhacquired during the year at Indian Copper Complex and total leasehold land measuring 7.83 acres of` 51.48 lakh available at Taloja Copper project, have been verified by us and are held in the name of theCompany.As stated in Note No.38 Para 4 & 6 of the accompanying standalone financial statements the titledeeds, conveyance deeds etc. in respect of certain freehold lands at Indian Copper Complex acquired throughnationalization in accordance with Indian Copper Corporation (Acquisition of Undertaking) Act, 1972 are not inpossession of the company and title deeds in respect of land at Scope complex, Delhi and Jaipur valuing` 58.47 lakh and lands (both freehold and leasehold) and Building acquired in respect of Gujarat Copper Projecthaving book value of ` 5859.97 lakh are yet to be executed in favor of the Company.Further to as stated above,the management has not been able to produce title deeds/lease deeds/other evidence of title for rest of the lands& buildings for which the company has to identify and reconcile the value of the leasehold and freehold lands &buildings shown under Note No. 3A & 3B (for freehold lands) and Note No. 9 &16 (for leasehold lands) of thestandalone financial statements with their respective land records.
(ii) The inventories of Finished Goods, Semi finished and in-Process stock, stock of Raw materials and Stores andSpares have been physically verified by the management during the year. The discrepancies between physical stocksand book records arising out of physical verification, which were not material as per the management, have beenproperly dealt with in the books of account.
(iii) According the information and explanations given to us, the Company has not granted any loans, secured or unsecuredto Companies, firms, Limited Liability Partnership or other parties, covered in the register maintained under section189 of the Companies Act, 2013.
(iv) According the information and explanations given to us ,the company has not given any loan, guarantee or providedany security in connection with such loan and given/made any loan /investment within the meaning of Sections 185and 186 of the companies Act, 2013 and as such, reporting under this clause is not applicable to the company.
(v) The Company has not accepted deposits during the year and does not have any unclaimed deposits as at March 31,2019 and as such, provision of paragraph 3(v) of the said order are not applicable to the company.
(vi) According to the information and explanations given to us, the maintenance of cost records has been specified by theCentral Government under section 148(1) of the Companies Act, 2013 in respect of mining activities of the Company.We have broadly reviewed such cost records and are of the opinion that prima facie' the prescribed accounts andrecords have been made and maintained.
ANNEXURE - A TO THE INDEPENDENT AUDITOR'S REPORT
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(vii) In respect of statutory dues:
a) According to the information and explanations given to us and on the basis of our examination of books ofaccount, the Company has been generally regular in depositing the undisputed statutory dues, including ProvidentFund, Employees' State Insurance, Income Tax, Goods and Service Tax, Customs Duty, Cess and other materialstatutory dues as applicable to it with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts payable in respect of ProvidentFund, Employees' State Insurance, Income Tax, Goods and Service Tax, Customs Duty, Cess and other materialstatutory dues were in arrears as at March 31, 2019 for a period of more than six months from the date theybecame payable .
b) According to the information and explanations given to us and as per the records of the company examined byus, following dues of Income Tax, Sales Tax/Value Added Tax, Provident Fund and Excise Duty which were inarrears as at March 31, 2019 on account of dispute:
Name of Nature of Dues Period to which Forum wherethe Statue the amount relates dispute is pending
Central Sales Tax Act Central Sales Tax 2007-08,2008-09 & Commissioner of 1679.472010-11 (ICC) Commercial Taxes,
Jamshedpur
Central Excise Act Central Excise 1985-86 (ICC) CESTAT 60.60
Central Excise Act Central Excise 1997-98 TO 1999-00 (ICC) CESTAT 203.52
Central Excise Act Central Excise 1995-96 (ICC) CESTAT 15.65
Central Excise Act Central Excise 2000-01 TO 2003-2004 (ICC) CESTAT 1501.76
Central Excise Act Central Excise 2000-2001 TO 2001-2002 (ICC) CESTAT 283.40
Central Excise Act Central Excise 1996-97 (ICC) CESTAT 1.46
Central Excise Act Central Excise 1998 (ICC) Supreme Court of India 16.00
Central Excise Act Central Excise 2014-15 to 2016-17 (ICC) High Court of Jharkhand 560.60
Central Excise Act Central Excise 2015-16 (ICC) Commissioner (Appeals) 55.02Central Excise (Appeals),Jamshedpur
EPF & MP Act 1952 Provident Fund 2014-15 to 2016-17 (ICC) Regional PF Commissioner, 268.95Jamshedpur
Madhya Pradesh Entry Tax 1994-95 (MCP) Commissioner (Appeals) *5.38Value Added Tax Act, Jabbalpur
Madhya Pradesh State Sales Tax/ VAT 2009-2010 (MCP) Sales tax Authority *34.47Value Added Tax Act, (Bhopal)
Madhya Pradesh State Sales Tax/ VAT 2011-2012 (MCP) Sales tax Authority *16.66Value Added Tax Act, (Bhopal)
GrossDisputeAmount(` in lakh)
ANNEXURE - A TO THE INDEPENDENT AUDITOR'S REPORT (Contd.)
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Name of Nature of Dues Period to which Forum wherethe Statue the amount dispute is
relates pending
Madhya Pradesh State Sales Tax/ VAT 2012-13 (MCP) Sales tax Authority *99.89Value Added Tax Act, (Bhopal)
Central Excise Act Central Excise 2005-06 TO 2007-08 (MCP) Commissioner Central 64.19Excise (Bhopal)
Central Excise Act Central Excise 2013-14 TO 2015-16 (MCP) CESTAT *859.07
Rajasthan Value Central Excise 2007-08 TO 2014-15 (KCC) Dy.Commissioner *581.71Added Tax Act, Appeal (Bikaner)
Central Excise Act Central Excise 1998-99 TO 2018-19 (KCC) Commissioner Central 2025.18 Excise, (Bikaner)
Central Excise Act Central Excise 2018-19 (KCC) CESTAT *95.70
Income Tax Act Income Tax 2016-17 & 2017-18 (KCC) Commissioner of Income *1.15Tax ,Jaipur
Maharashtra Value State Sales Tax/ VAT 1994-95,2011-12 , 2012-13 Joint Commisioner *929.93Added Tax Act, & 2013-14 (TCP) (Sales Tax),Maharashtra
Central Excise Act Central Excise 2010-11 (TCP) CESTAT 5.26
Income Tax Act Income Tax 2001-02,2002-03,2003-04, High Court of Kolkata 10320.522005-06,2006-07,2007-08 (HO)
Income Tax Act Income Tax 2011-12,2012-13,2007-08 (HO) Commissioner of Income, *510.92Tax (Appeals), Kolkata
Water (Prevention and Water Cess 1999-2000 Water Resources 1416.64Control of Pollution) Department, GovernmentCess Act, 1977 of Jharkhand
GRAND TOTAL 20196.46
GrossDisputeAmount(` in lakh)
*Aggregate amount of ` 712.98 lakh have been deposited against the cases and shown as "Deposit with Government authorities" underNote No.-16 "Other current Assets".
(viii) According to the information and explanations given to us, the Company has not defaulted in repayment of loans orborrowings to financial institutions, banks and government and dues to debenture holders during the year.
(ix) According to the information and explanations given to us, the Company has not raised moneys by way of initialpublic offer or further public offer (including debt instruments) during the year. Based on the information available,the term loan has applied for the purpose for which they were obtained.
(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by theCompany or no fraud on the Company by its officers or employees has been noticed or reported during the year.
(xi) As per notification no. GSR 463(E) dated 5th June 2015 issued by the Ministry of Corporate Affairs, Government ofIndia, Section 197 for managerial remuneration is not applicable to the Government Company and as such, provisionof paragraph 3(xi) of the said order are not applicable to the company.
ANNEXURE - A TO THE INDEPENDENT AUDITOR'S REPORT (Contd.)
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(xii) According to the information and explanations given to us, the Company is not a Nidhi Company and as suchprovisions of paragraph 3(xii) of the said order are not applicable to the company.
(xiii) According to the information and explanations given to us and based on our examination of books of accounts,transactions with the related parties are in compliance with Section 177 and 188 of the Companies Act, 2013 whereapplicable and the details of such transactions have been disclosed in the standalone financial statements asrequired by the applicable accounting standards.
(xiv) According to the information and explanations given to us, the Company has not made any preferential allotmentor private placement of shares or fully or partly paid convertible debentures and hence reporting under this clauseis not applicable to the company.
(xv) According to the information and explanations given to us and based on our examination of books of accounts, theCompany has not entered into any non-cash transactions with its Directors or persons connected to its directorsand hence provisions of Section 192 of the Companies Act, 2013 are not applicable to theCompany.
(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and assuch reporting under this clause is not applicable to the company.
For Chaturvedi & Co.
Chartered Accountants
(Firm's Registration No.302137E)
CA S.C. Chaturvedi
Partner
(Membership No. 012705)
Place: New Delhi
Date: May 28, 2019
ANNEXURE - A TO THE INDEPENDENT AUDITOR'S REPORT (Contd.)
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Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 ofSection 143 of the Companies Act, 2013 (“the Act”)
We have audited the internal financial controls over financial reporting of Hindustan Copper Limited (hereinafterreferred as “the Company”) as of March 31, 2019 in conjunction with our audit of the standalone financial statementsof the Company for the year ended on that date.
Management's Responsibility for Internal Financial Controls
The Board of Directors of the Company is responsible for establishing and maintaining internal financial controls basedon the internal control over financial reporting criteria established by the Company considering the essential componentsof internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issuedby the Institute of Chartered Accountants of India. These responsibilities include the design, implementation andmaintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficientconduct of its business, including adherence to respective company's policies, the safeguarding of its assets, the preventionand detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparationof reliable financial information, as required under the Companies Act, 2013.
Auditor's Responsibility
Our responsibility is to express an opinion on the internal financial controls over financial reporting of the Companybased on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial ControlsOver Financial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India and the Standardson Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internalfinancial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internal financial controls over financialreporting included obtaining an understanding of internal financial controls over financial reporting, assessing the riskthat a material weakness exists, and testing and evaluating the design and operating effectiveness of internal controlbased on the assessed risk. The procedures selected depend on the auditor's judgment, including the assessment of therisks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinionon the internal financial controls system over financial reporting of the Company.
Meaning of Internal Financial Controls Over Financial Reporting
A company's internal financial control over financial reporting is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financial control over financial reportingincludes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accuratelyand fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements in accordance with generally acceptedaccounting principles, and that receipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) provide reasonable assurance regarding preventionor timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a materialeffect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility ofcollusion or improper management override of controls, material misstatements due to error or fraud may occur and notbe detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periodsare subject to the risk that the internal financial control over financial reporting may become inadequate because ofchanges in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Company has, in allmaterial respects, an adequate internal financial controls system over financial reporting and such internal financial
ANNEXURE - B TO THE INDEPENDENT AUDITOR'S REPORT
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controls over financial reporting were operating effectively as at March 31, 2019, based on the internal control overfinancial reporting criteria established by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India. However certain areas need further improvement in designing the "Documentation on InternalFinancial Controls" of the Company by way of improving the fixed assets accounting, cash and bank management,payable management, receivable management,inventory management, elaborating the process flow by which thetransactions are initiated, authorized, processed, recorded, and reported at department level. System integration tocapture the transactions that relates to financial statements and events/conditions and other transactions significant tothe financial statements has to be designed properly so as to fulfill the objectives of control criteria established by theCompany. Further modification of finance/accounts manual needs to be done incorporating the Indian Accounting Standardrequirements to have effective internal control over financial reporting.
However, our opinion is not qualified in the above respect.
For Chaturvedi & Co.
Chartered Accountants
(Firm's Registration No.302137E)
CA S.C. Chaturvedi
Partner
(Membership No. 012705)Place: New Delhi
Date: May 28, 2019
ANNEXURE - B TO THE INDEPENDENT AUDITOR'S REPORT (Contd.)
F-143
72
Directions under Section 143(5) of Companies Act 2013
Sl. Details/ Directions Auditors' Reply Action Taken andNo. Impact on Accounts &
Financial Statements
Yes, the Company has systemin place to process all theaccounting transactionsthrough IT system.
As informed to us, there is nosuch case of restructuring of anexisting loan or loan/interestetc. made by a lender to thecompany.
However the Company haswritten back the liabilities of` 1095.29 lakh during the yearwhich as per the Company, nolonger payable in nature.
Based on the informationavailable and according to theinformation and explanationsgiven to us, the company has notreceived any fund for specificschemes from central/ stateagencies during the year.
Whether the company has systemin place to process all theaccounting transactions throughIT system? If yes, the implicationsof processing of accountingtransactions outside IT system onthe integrity of the accounts alongwith the financial implications, ifany, may be stated.
Whether there is anyrestructuring of an existing loanor cases of waiver/write off of debts/loans/interest etc. made by alender to the company due to thecompany's inability to repay theloan? If yes, the financial impactmay be stated.
Whether funds received/receivable for specific schemesfrom central/ state agencies wereproperly accounted for/ utilized asper its term and conditions? Listthe cases of deviation.
No impact on the accounts andfinancial Statements.
Liabilities of ` 1095.29 lakhwere written back during theyear and impact of it has beenin increase of profit by theamount.
No impact on the accounts andfinancial Statements.
ANNEXURE - C TO THE INDEPENDENT AUDITOR'S REPORT
For Chaturvedi & Co.Chartered Accountants
(Firm's Registration No.302137E)
CA S.C. ChaturvediPartner
(Membership No. 012705)Place: New Delhi
Date: May 28, 2019
1.
2.
3.
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For and on the behalf of the
Comptroller & Auditor General of India
Place : KolkataDate : 24 June 2019
(Suparna Deb)Director General of Commercial Audit& Ex-officio Member, Audit Board-I,
Kolkata
COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION143(6)(b) OF THE COMPANIES ACT, 2013 ON THE FINANCIAL STATEMENTS OF HINDUSTANCOPPER LIMITED FOR THE YEAR ENDED 31 MARCH 2019
The preparation of financial statements of Hindustan Copper Limited for the year ended 31 March 2019 in
accordance with the financial reporting framework prescribed under the Companies Act, 2013 (Act) is the responsibility
of the management of the company. The statutory auditor appointed by the Comptroller and Auditor General of India
under Section 139(5) of the Act is responsible for expressing opinion on these financial statements under Section 143 of
the Act based on independent audit in accordance with the standards on auditing prescribed under section 143(10) of the
Act. This is stated to have been done by them vide their Audit Report dated 28 May 2019.
I, on behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit of the
financial statements of Hindustan Copper Limited for the year ended 31 March 2019 under Section 143(6)(a) of the Act.
This supplementary audit has been carried out independently without access to the working papers of the statutory
auditor and is limited primarily to inquiries of the statutory auditor and company personnel and a selective examination
of some of the accounting records.
On the basis of my supplementary audit nothing significant has come to my knowledge which would give rise
to any comment upon or supplement to statutory auditors’ report under Section 143(6)(b) of the Act.
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(` in lakh)
PARTICULARS Note No. As at As at31st March, 2019 31st March, 2018
ASSETS(1) NON-CURRENT ASSETS(a) Property, Plant and Equipment 3A & 3B 31648.77 33199.74(b) Capital Work In Progress 4 102211.31 65954.68(c) Financial Assets
(i) Investments 5 18.50 -(ii) Others 6 12.47 1.44
(d) Deferred Tax Assets (Net) 7 6245.62 5577.71(e) Non-Current Tax Assets (Net) 8 620.33 983.43(f) Other Non-Current Assets 9 53268.78 57303.93(2) CURRENT ASSETS(a) Inventories 10 64366.77 78861.51(b) Financial Assets
(i) Investments 11 8.85 8.18(ii) Trade receivables 12 36154.83 8157.36(iii) Cash and cash equivalents 13 658.42 879.67(iv) Bank Balances other than above 14 424.19 391.54(v) Others 15 3279.93 4703.55
(c) Other current assets 16 32108.63 22725.94
Total Assets 331027.40 278748.68
EQUITY AND LIABILITIES
(1) Equity(a) Equity Share Capital 17 46260.90 46260.90
(b) Other Equity 18 116850.59 106468.09Liabilities
1 NON-CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 19 57065.73 10208.27(ii) Other financial liabilities 20 843.53 923.57
(b) Provisions 21 5471.59 8186.73(2) CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 22 49945.20 55486.81(ii) Trade Payables 23 20229.08 22613.35(iii) Other financial liabilities 24 7600.37 5609.32
(b) Other current liabilities 25 18880.70 17150.64(c) Provisions 26 6295.75 5237.50(d) Current Tax Liabilities (Net) 27 1583.96 603.50
Total Equity & Liabilities 331027.40 278748.68
Corporate Information 1Significant Accounting Policies 2General Notes on Accounts 38
STANDALONE BALANCE SHEET AS AT 31ST MARCH 2019
The notes referred to above form an integral part of the Financial Statements.In terms of our report of even date attached.For Chaturvedi & Co.Chartered AccountantsFRN 302137E(CA S C Chaturvedi)Partner(M No. 012705)
Place : New DelhiDated : 28th May, 2019
For and on behalf of the Board of DirectorsSanjay Kumar Bhattacharya
Director (Mining)( DIN : 07276836)
C.S.SinghiCompany Secretary(M No. FCS 2570)
Sukhen Kumar BandyopadhyayDirector (Finance) & CFO
( DIN : 08173882)
Santosh SharmaChairman and Managing Director
& CEO ( DIN : 07431945)
F-146
75
Particulars Note No. For the year ended For the year ended31st March 2019 31st March 2018
I Revenue from Operations 28 181625.72 170590.88II Other Income 29 3665.87 4106.56
III Total Income (I+II) 185291.59 174697.44IV EXPENSES
Cost of Materials Consumed 30 6493.41 41138.01Changes in Inventories of Finished Goods,Semi-Finished and Work-In-Process 31 14336.74 (724.65)Employee Benefits Expense 32 31651.48 32788.84Finance Costs 33 5546.10 2128.65Depreciation and Amortisation Expense 34 25288.75 16465.25General,Administration & Other Expenses 35 78940.47 70697.80Total Expenses (IV) 162256.95 162493.90
V PROFIT /(LOSS) BEFORE EXCEPTIONAL ITEMS AND TAX (III-IV) 23034.64 12203.54VI Exceptional items – –
VII PROFIT /(LOSS) BEFORE TAX (V-VI) 23034.64 12203.54VIII TAX EXPENSE 36
1) Current Tax 9128.93 4639.682) Deferred Tax (667.91) (419.36)IX PROFIT /(LOSS) FOR THE PERIOD FROM
CONTINUING OPERATIONS AFTER TAX (VII-VIII) 14573.62 7983.22X Profit/(Loss) from discontinued operations (34.70) (34.70)
XI Tax expense of discontinued operations (12.13) (12.01)XII PROFIT/(LOSS) FROM DISCONTINUED
OPERATIONS AFTER TAX (X -XI) (22.57) (22.69)XIII PROFIT /(LOSS) FOR THE PERIOD AFTER TAX (IX+XII) 14551.05 7960.53XIV OTHER COMPREHENSIVE INCOME 37A(i) Items that will not be reclassified to Profit or Loss (1676.21) 499.52
A(ii) Income Tax relating to items that willnot be reclassified to Profit or Loss – –
B(i) Items that will be reclassified to Profit or Loss – –B(ii) Income Tax relating to items that will be reclassified
to Profit or Loss – –XV TOTAL COMPREHENSIVE INCOME FOR THE PERIOD (XIII+XIV)
(Comprising Profit/(Loss) and Other Comprehensive Income for the period) 12874.84 8460.05XVI Earning per equity share (for continuing operations)
1 BASIC (`) 1.575 0.8632 DILUTED (`) 1.575 0.863
XVII Earning per equity share (for discontinued operations)1 BASIC (`) (0.002) (0.002)2 DILUTED (`) (0.002) (0.002)
XVIII Earning per equity share (for discontinued & continuing operations)1 BASIC (`) 1.573 0.8612 DILUTED (`) 1.573 0.861
Corporate Information 1Significant Accounting Policies 2General Notes on Accounts 38The notes referred to above form an integral part of the Financial Statement.
STANDALONE STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH 2019
(` in lakh except EPS)
In terms of our report of even date attached.
For Chaturvedi & Co.Chartered AccountantsFRN 302137E
(CA S C Chaturvedi)Partner(M No. 012705 )
Place : New DelhiDated : 28th May, 2019
For and on behalf of the Board of Directors
Sanjay Kumar BhattacharyaDirector (Mining)( DIN : 07276836)
C.S.SinghiCompany Secretary(M No. FCS 2570)
Sukhen Kumar BandyopadhyayDirector (Finance) & CFO
( DIN : 08173882)
Santosh SharmaChairman and Managing Director
& CEO ( DIN : 07431945)
F-147
76
STANDALONE STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31ST MARCH 2019B.
Oth
er E
quit
y
Part
icul
ars
Gen
eral
Capi
tal
Corp
orat
e So
cial
Min
eCu
rren
cyR
etai
ned
Tota
lR
eser
veR
eser
veR
espo
nsib
ility
Clos
ure
Fluc
tuat
ion
Earn
ing
Res
erve
Res
erve
sR
eser
ves
Bala
nce
at th
e be
ginn
ing
of th
e re
port
ing
perio
d 01
.04.
2017
8965
.97
2116
6.24
222
.90
- -
7008
0.18
1004
35.2
9
Divi
dend
& D
ivid
end
Tax
- -
-(2
227.
13)
(222
7.13
)
Prof
it fo
r the
Yea
r -
- -
7960
.53
7960
.53
Othe
r Com
preh
ensiv
e In
com
e49
9.52
499.
52
Amou
nt a
dditi
on d
urin
g th
e ye
ar -
- -
Amou
nt u
sed
durin
g th
e ye
ar -
-(2
00.1
2) -
- (2
00.1
2)
Bala
nce
at th
e en
d of
the
repo
rtin
g pe
riod
31.0
3.20
1889
65.9
721
166.
2422
.78
- -
7631
3.10
1064
68.0
9
Stat
emen
t of
Cha
nges
in E
quit
yA
. E
quit
y Sh
are
Cap
ital
4626
0.90
462
60.9
0
(` in
lakh
)
Stat
emen
t of C
hang
es in
Equ
ity
A . E
quit
y Sh
are
Capi
tal
Bala
nce a
t the
begi
nnin
g of t
he re
port
ing p
eriod
01.0
4.20
17Ch
ange
s in
equi
ty sh
are
capi
tal d
urin
g th
e ye
ar-
Bala
nce
at th
e en
d of
the
repo
rtin
g pe
riod
31.0
3.20
18
Bala
nce a
t the
begi
nnin
g of t
he re
port
ing p
eriod
01.0
4.20
18Ch
ange
s in
equi
ty sh
are
capi
tal d
urin
g th
e ye
ar-
Bala
nce
at th
e en
d of
the
repo
rtin
g pe
riod
31.0
3.20
19
4626
0.90
462
60.9
0
(` in
lakh
)
B. O
ther
Equ
ity
Part
icul
ars
Gen
eral
Capi
tal
Corp
orat
e So
cial
Min
eCu
rren
cyR
etai
ned
Tota
lR
eser
veR
eser
veR
espo
nsib
ility
Clos
ure
Fluc
tuat
ion
Earn
ing
Res
erve
Res
erve
sR
eser
ves
Bala
nce a
t the
beg
inni
ng of
the r
epor
ting
perio
d 01
.04.20
1889
65.9
721
166.
24 2
2.78
- -
7631
3.10
1064
68.0
9Di
vide
nd &
Div
iden
d Ta
x -
- -
(278
8.50
)(2
788.
50)
Prof
it fo
r the
Yea
r -
- -
1455
1.05
1455
1.05
Othe
r Com
preh
ensiv
e In
com
e(1
676.
21)
(167
6.21
)Am
ount
add
ition
dur
ing
the
year
163
.00
155
.94
318
.94
Amou
nt u
sed
durin
g th
e ye
ar -
- (2
2.78
) -
- (2
2.78
)Ba
lanc
e at
the
end
of th
e re
port
ing
perio
d 31
.03.
2019
8965
.97
2116
6.24
-
163
.00
155
.94
8639
9.44
1168
50.5
9
In te
rms
of o
ur r
epor
t of e
ven
date
att
ache
d.Fo
r C
hatu
rved
i & C
o.C
hart
ered
Acc
ount
ants
FRN
302
137E
(CA
S C
Cha
turv
edi)
Part
ner
(M N
o. 0
1270
5 )
Plac
e : N
ew D
elhi
Dat
ed :2
8th
May
, 201
9
For
and
on b
ehal
f of t
he B
oard
of D
irec
tors
Sanj
ay K
umar
Bha
ttac
hary
aD
irec
tor
(Min
ing)
( DIN
: 07
2768
36)
C.S
.Sin
ghi
Com
pany
Sec
reta
ry(M
No.
FCS
257
0)
Sukh
en K
umar
Ban
dyop
adhy
ayD
irec
tor
(Fin
ance
) & C
FO( D
IN :
0817
3882
)
Sant
osh
Shar
ma
Cha
irm
an a
nd M
anag
ing
Dir
ecto
r&
CE
O (
DIN
: 07
4319
45)
-
F-148
77
A. CASH FLOW FROM OPERATING ACTIVITIES :NET PROFIT/ (LOSS) BEFORE TAX AS PER STATEMENT OF PROFIT AND LOSS 23034.64 12203.54Adjusted for :
Depreciation 3661.65 3272.02Provisions charged 1899.68 1022.14Provisions written back (1095.29) (1376.96)Interest expense 5546.10 2128.65Dividend declared - 1850.44Dividend tax payable - 376.70Amortisation 21627.10 13193.23Interest income (334.49) (1706.74)Loss / (Profit) on disposal of fixed assets (48.24) 1.71
OPERATING PROFIT/ (LOSS) BEFORE WORKING CAPITAL CHANGES 54291.15 30964.73Adjusted for :
Decrease/ (Increase) in Trade & other Receivables (28004.35) 8348.78Decrease/ (Increase) in Inventories 14412.96 3316.59Decrease/ (Increase) in Current & Non-Current assets (7008.79) (10664.58)Increase/ (Decrease) in Current & Non-Current Liabilities (2836.41) 6376.23
CASH GENERATED FROM OPERATIONS 30854.56 38341.75Tax Refund received 1106.54 3637.10Taxes paid (6730.75) (4800.00)
NET CASH FROM OPERATING ACTIVITIES (A) 25230.35 37178.85
B. CASH FLOW FROM INVESTING ACTIVITIES :Purchase of Fixed Assets (40039.64) (39748.56)Sale of Fixed Assets 80.07 32.60Interest received 415.71 2467.98Advance for / (Recovery of advance) for Capital expenditure 260.68 99.27Investment in Subsidiary (18.50) -Mine Development Expenditure (19369.43) (18601.96)
NET CASH USED IN INVESTING ACTIVITIES ( B ) (58671.11) (55750.67)C. CASH FLOW FROM FINANCING ACTIVITIES :
Non-Current borrowings / (Loan repaid) 52669.68 (5207.41)Dividends paid (2313.05) (1850.43)Tax on Dividend (475.45) (376.71)Interest paid (5422.90) (2170.95)
NET CASH USED IN FINANCING ACTIVITIES ( C ) 44458.28 (9605.50)NET INCREASE IN CASH AND CASH EQUIVALENTS ( A + B + C ) 11017.52 (28177.32)CASH AND CASH EQUIVALENTS - opening balance (49136.09) (20958.77)CASH AND CASH EQUIVALENTS - closing balance (38118.57) (49136.09)(Details in Annexure - A)
(` in lakh)
For the year ended31st March 2019
For the year ended31st March 2018
STANDALONE CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH 2019
In terms of our report of even date attached.
For Chaturvedi & Co.Chartered AccountantsFRN 302137E(CA S C Chaturvedi)Partner(M No. 012705 )
Place : New DelhiDated : 28th May, 2019
For and on behalf of the Board of Directors
Sanjay Kumar BhattacharyaDirector (Mining)( DIN : 07276836)
C.S.SinghiCompany Secretary(M No. FCS 2570)
Sukhen Kumar BandyopadhyayDirector (Finance) & CFO
( DIN : 08173882)
Santosh SharmaChairman and Managing Director
& CEO ( DIN : 07431945)
F-149
78
ANNEXURE - A
(` in lakh)
CASH AND CASH EQUIVALENTS - Opening Balance 01/04/2018 01/04/2017
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 879.67 121.22ii) Current Financial Assets - Bank Balance other that above (Note 14) 379.16 5362.70
(Excluding Unpaid Dividend of ` 12.38 lakh)iii) Current Financial Assets - Investments (Note 11) 8.18 0.05iv) Non-current Financial Assets - Others (Note 6) 1.44 266.33v) Current Financial Liabilities - Borrowings (Note 22) (50301.84) (26130.71)
vi) Current Financial Liabilities - Borrowings (Note 22) (102.70) (578.36)
(49136.09) (20958.77)
CASH AND CASH EQUIVALENTS - Closing Balance 31/03/2019 31/03/2018
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 658.42 879.67ii) Current Financial Assets - Bank Balance other that above (Note 14) 408.33 379.16
(Excluding Unpaid Dividend of ` 15.86 lakh)iii) Current Financial Assets - Investments (Note 11) 8.85 8.18iv) Non-current Financial Assets - Others (Note 6) 12.47 1.44v) Current Financial Liabilities - Borrowings (Note 22) (39300.01) (50301.84)
vi) Current Financial Liabilities - Borrowings (Note 22) 93.37 (102.70)
(38118.57) (49136.09)
STANDALONE CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH 2019 (Contd.)
The Cash Flow Statement has been prepared as set out in Indian Accounting Standard (IND AS) 7 : STATEMENTof CASH FLOWS, as amended by Companies (Indian Accounting Standards) (Amendment) Rules 2016.
This is the Cash Flow Statement referred to in our report of even date attached.
F-150
79
NOTES TO THE STANDALONE FINANCIAL STATEMENTS
1. Corporate Information
Hindustan Copper Limited,established in 1967 and domiciled in India is a Central public sector undertaking under theadministrative control of Ministry of Mines, Government of India. The registered office of the company is situated atKolkata. The principal activities of the company are exploration, exploitation, mining of copper and copper ore includingbeneficiation of minerals, smelting and refining. The Company has copper mines & concentrator plants in MalanjkhandCopper Project at Madhya Pradesh (MCP), Khetri Copper Complex at Rajasthan (KCC) and Indian Copper Complex,Ghatsila at Jharkhand (ICC). The company is operating Smelter & Refinery in ICC and Gujarat Copper Project, Gujarat(GCP) for production of copper cathode. Further, cathode is converted into copper wire rod at Copper wire rod plant atTaloja Copper Project, Taloja, Maharashtra (TCP). The Company is listed with BSE Ltd. and National Stock Exchange ofIndia Ltd.
2. Significant Accounting Policies
2.1 Basis of Accounting
The financial statements are prepared under historical cost convention from the books of accounts maintained underaccrual basis except for certain financial instruments which are measured at fair value and in accordance with theIndian Accounting Standards prescribed under Companies Act, 2013.
2.2 Application of Indian Accounting Standards (Ind-AS)
The Company adopted Indian Accounting Standards (Ind AS) from April 1,2016 and accordingly the financial statementshave been prepared in accordance with the recognition and measurement principles as notified by MCA under theCompanies (Indian Accounting Standards) Rules, 2015 ("Ind AS Rules"), of the Companies Act, 2013.
The Company has adopted all the Ind AS as applicable and relevant to the Company.
2.3 Use of Estimates
The preparation of the Company's financial statements requires management to make judgements, estimates andassumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanyingdisclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could resultin outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.Revision to accounting estimates are recognised in the period on which the estimates are revised and, if material, theireffects are disclosed on the notes to the financial statements.2.4 Current and Non-current ClassificationThe Company presents assets and liabilities in the Balance Sheet based on current/non-current classification.An asset istreated as current by the company when:
a) its expects to realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it holds the assets primarily for the purpose of trading;c) it expects to realize the asset within twelve months after the reporting date; ord) the asset is cash or cash equivalent (as defined under Ind AS 7) unless the asset is restricted from being exchanged
or used to settle a liability for at least twelve months after the reporting period.Except the above, all other assets are classified as Non-current.A liability is treated as current by the company when:
a) its expects to settle the liability realize the asset, or intends to sell or consume it in its normal operating cycle;b) it expects to settle the liability in its normal operating cycle;c) it holds the liability primarily for the purpose of trading;
d) the liability is due to be settled within twelve months after the reporting period; ore) it does not have an unconditional right to defer settlement of the liability for at least twelve months after the
reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by theissue of equity instruments do not affect its classification.
Except the above, all other liabilities are classified as non-current.F-151
80
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
2.5 Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable and fair value has been defined takinginto account contractually defined terms of payment. Operating revenue recognized is net of all promotional expensesand discounts, rebates and/or any other incentive to customers.
Sale of Products
An entity shall account for a sale contract with a customer only when all of the following criteria are met:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customarybusiness practices) and are committed to perform their respective obligations;
(b) the entity can identify each party's rights regarding the goods to be transferred;
(c) the entity can identify the payment terms for the goods to be transferred;
(d) the contract has commercial substance i.e the risk, ownership, timing or amount of the entity's future cash flowsetc is expected to change as a result of the contract; and
(e) it is probable that the entity will collect the consideration to which it will be entitled in exchange for the goods thatwill be transferred to the customer.
In case of sale of Copper Concentrate, Copper Reverts, Anode Slime etc. and tolling of Copper Concentrate of Khetri andMalanjkhand origin, sales / tolling at the end of the accounting period are recorded on provisional basis as per standardparameters for want of actual specifications and differential sales value are recorded only on receipt of actual. This is asper consistent practice followed by the company.
Sale of Services
Income from conversion of job work is accounted for on the basis of actual quantity dispatched. When the outcome of atransaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shallbe recognized by reference to the stage of completion (Percentage of Completion Method) of the transaction at the end ofthe reporting period.
Advances received from the customers are reported as customer's deposits unless the above conditions for revenuerecognition are met.
Other Operating Revenues
a. Sale of ScrapSale of Scrap is accounted for on delivery of material.
b. Interest received from CustomersIn case of credit sales ,interest up to the date of Balance Sheet on all outstanding bills is accounted for on accrualbasis.
c. Interest from Contractors against mobilisation advance for mining operationsInterest up to the date of Balance Sheet on all mobilisation advances for mining operations is accounted for onaccrual basis.
d. Penalty and Liquidated DamagesPenalty and liquidated damages are accounted for as and when these are realised by the company as per contractterms.
Other Income
a. Claims
Claims are recognized in the Statement of Profit & Loss (Net of any payable) including receivables from Governmenttowards subsidy, cash incentives, reimbursement of losses,etc, when there is certainty of realisation of such claimand that can be measured reliably.
b. Dividend and Interest from Investments
Dividend income from Investments is recognised in the Statement of Profit and Loss when the right to receive theF-152
81
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
dividend has been established and it is certain that the economic benefits will flow to the company and the amountof income can be measured reliably.
Interest Income from a financial asset is recognised using Effective Interest Method. When it is probable that theeconomic benefits will flow to the Company and the amount of income can be measured reliably.
c. Profit on Sale of Investment
Profit on sale of investment is recognised upon transfer of title by the company and is determined as the differencebetween the sales price and the then carrying value of the investment.
d. Provisions not required written back
Provisions/Liabilities created from business activities in earlier years no longer required are accounted for.
e. Others
Any other income is recognised on accrual basis.
2.6 Employees Benefit
Retirement benefit costs and termination benefitsPayments to defined contribution retirement benefit plans are recognized as an expense when employees have renderedservice entitling them to the contributions.For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit creditmethod, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprisingactuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets(excluding interest), is reflected immediately in the statement of financial position with a charge or credit recognized inother comprehensive income in the period in which they occur. Re-measurement recognized in other comprehensiveincome is reflected immediately in retained earnings and will not be reclassified to Statement of Profit or Loss. Pastservice cost is recognized in Statement of Profit or Loss in the period of a plan amendment. Net interest is calculated byapplying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costsare categorized as follows:
i. Service cost (including current service cost, past service cost, etc.);ii. Net interest expense or income; and
iii. Re-measurement.The company presents the first two components of defined benefit costs in profit or loss in the line item 'employee benefitsexpense'.The retirement benefit obligation recognized in the statement of financial position represents the actual deficit or surplusin the company defined benefit plans. Any surplus resulting from this calculation is limited to the present value of anyeconomic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.A liability for a termination benefit is recognized at the earlier of when the company can no longer withdraw the offer ofthe termination benefit and when the company recognises any related restructuring costs.Short-term and other long-term employee benefitsA liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick leavein the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchangefor that service.Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefitsexpected to be paid in exchange for the related service.Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimatedfuture cash outflows expected to be made by the company in respect of services provided by employees up to the reportingdate.Deficit in Provident Fund
Deficit, if any, in the accounts of Provident Fund Trust ascertained on the basis of last audited accounts of the Trust isaccounted for as a charge to Revenue. F-153
82
2.7 Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes asubstantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All otherborrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest expenses calculatedusing the effective interest method and other costs that an entity incurs in connection with the borrowing of funds.Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs
2.8 Taxation
Income tax expense represents the sum of current tax and deferred tax.
Current tax
The current tax payable is based on taxable profit for the year as determined from net profit before tax as represented inStatement of Profit and Loss and Other Comprehensive Income, in line with different provisions under Income Tax Act1961.Current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reportingperiod.
Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financialstatements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generallyrecognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporarydifferences to the extent that it is probable that taxable profits will be available against which those deductible temporarydifferences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent thatit is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which theliability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enactedby the end of the reporting period.
Current and Deferred Tax for the year
Current and deferred tax are recognized in Statement of Profit and Loss, except when they relate to items that arerecognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are alsorecognized in other comprehensive income or directly in equity respectively.
2.9 (a) Property Plant and Equipment (PPE)
The cost of an item of PPE is recognized as an asset if and only if, it is probable that future economic benefits associatedwith the item will flow to the company and the cost of the item can be measured reliably. The cost of an item of PPE is thecash price equivalent at the recognition date. The cost of an item of PPE comprises:
i. Purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts andrebates.
ii. Costs directly attributable to bringing the PPE to the location and condition necessary for it to be capable ofoperating in the manner intended by management.
iii. The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located,the obligation for which the company incurs either when the PPE is acquired or as a consequence of having used thePPE during a particular period for purposes other than to produce inventories during that period.
The company has chosen the cost model of recognition and this model is applied to an entire class of PPE. After recognitionas an asset, an item of PPE is carried at its cost less any accumulated depreciation and any accumulated impairmentlosses.
Pending reconciliation/receipt of the final bills against capital items, capitalization is done on the basis of cost bookedand depreciation is charged accordingly. Price differences, if any, are adjusted in the year of finalization of bills.
In respect of expenditure during construction/development of a new unit/project in a new location, all direct capitalexpenditure as well as all indirect expenditure incidentals to construction are capitalized allocating to various items ofPPE on an appropriate basis. Expansion programme involving construction concurrently run with normal production
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-154
83
activities in an existing unit, all direct capital expenditure in relation to such expansion are capitalized but indirectexpenditure are charged to revenue. Borrowing costs that are attributable to the acquisition or construction of qualifyingasset are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial periodof time to get ready for its intended use.
Expenses incurred for implementation of new projects are carried forward against respective projects till execution.Expenses rendered in fructuous projects abandoned subsequently are provided for in the Statement of Profit and Loss.
Physical verification of PPE is conducted every year so that all the units/offices are covered once in a block of three yearsinterval. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts inthe year of identification.
Depreciation and Amortization
The company has used the exemption available in Ind AS 101 with respect to recognition of Plant, Property and Equipment(PPE) and Intangible Assets at their carrying value being deemed cost.
The depreciable amount of an item of PPE is allocated on a straight line basis over its useful life prescribed in Part C ofSchedule II of the Companies Act,2013 or actual useful life of assets assessed by the Technical Committee of the company,whichever is lower. The residual value and the useful life of an asset are reviewed, at each financial year-end. Each partof an item of PPE with a cost that is significant in relation to the total cost of the item is depreciated separately. Depreciationon all such items have been provided from the date they are 'Put to Use' till the date of sale and includes amortization ofintangible assets and lease hold assets. Freehold land is not depreciated. The residual value of all such items is taken at5% of the original cost of individual asset.
An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the continueduse of the asset. Certain consumable items of small value whose useful life is very limited are directly charged to revenuein the year of purchase.
From the date Ind AS came into effect, the carrying amount of an asset is depreciated over the remaining useful life of theasset as per estimate of remaining useful life. Wherever, the remaining useful life of an asset is nil, the carrying amountis recognized in the opening balance of retained earnings after retaining the residual value.
2.9 (b) Intangible Assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquiredin a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets arecarried at cost less any accumulated amortisation (calculated on a straight-line basis over their useful lives) andaccumulated impairment losses, if any.
Internally generated intangibles, excluding capitalised development costs, are not capitalised. Instead, the relatedexpenditure is recognised in the Statement of Profit and Loss and other comprehensive income in the period in which theexpenditure is incurred. An internally generated intangible asset arising from development is recognized if all the conditionsstipulated in "Ind AS 38-Intangible Asset" are met. The useful lives of intangible assets are assessed as either finite orindefinite. Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairmentwhenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisationmethod for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changesin the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset areconsidered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates.The amortisation expense on intangible assets with finite lives is recognised in the Statement of Profit and Loss.
An intangible asset with an indefinite useful life is not amortised but is tested for impairment at each reporting date andits useful life is reviewed in each reporting period to determine whether events and circumstances continue to support anindefinite useful life estimate.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposalproceeds and the carrying amount of the asset and are recognised in the Statement of Profit and Loss.
Intangible Assets other than Software are amortized over estimated useful life which is equivalent to license period,generally not more than 5 years.
Cost of Software recognized as intangible asset, is amortised on straight line method over a period of legal right to usewith a nil residual value. Otherwise the cost of software will be charged in the year of incurrence.
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-155
84
2.10 Capital Work in Progress
Assets in the course of construction are included under capital work -in-progress and are carried at cost,less any recognizedimpairment loss. Such capital work-in-progress, on completion, is transferred to the appropriate category of property,plant and equipment.
2.11 Mine Development Expenditure
In case of underground mines : The expenditure on development of a new mine in all cases and on subsequentdevelopment of a working mine is capitalized and depleted on the basis of ore raised during the year and the mineableore reserves estimated from time to time.
In case of working mines, where development activities are going on simultaneously: Expenses are apportioned betweencapital and revenue on the basis of in-house technical estimates.
In respect of open cast mines : The expenditure on removal of waste and overburden, is capitalized and the same isdepleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodicallybased on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines. Subsequently,if any ore is reclaimed from overburden, the same is included in inventory at a value based on opening rate of minedevelopment expenditure with a corresponding credit in Mine development expenditure.
Expenditure incurred on development of new deposits are capital in nature and is included in mine developmentexpenditure. If subsequently the development activities are found to be not viable, the expenditure on such developmentwork included in mine development expenditure is written off in the year in which it is decided to abandon the project.
If a working mine is closed due to economic reasons, the un-depleted value of Mine Development Expenditure related tothat mine is provided in the books of accounts in the year in which it is decided to close or suspend operation of the mine.If later on, the closed / suspended mines are re-opened and the company remains the owner of the mines, the unamortizedMine Development Expenditure which was fully provided in the year of closure will be written back in the books ofaccounts in the year of re-opening and the company will be depleting it year wise based on the estimated remaining lifeof that mine.
2.12 Overhauling Expenses
Revenue expenditure attributable to overhaul of smelter and/ or refinery is charged off to the Statement of Profit andLoss in the year of incurrence.
2.13 Mine Closure Expenditure
Financial implications towards final mine closure plans under relevant Acts and Rules are technically estimated andMine Closure Reserve is created based on the estimated life of the mines over the period by charging the same to Statementof Profit and Loss.
2.14 Non-Current Assets Held for Sale
The company classifies a non-current asset (or disposal group of assets) as held for sale if its carrying amount will berecovered principally through a sale transaction rather than through continuing use. Immediately before the initialclassification of the asset (or disposal group) as held for sale, the carrying amounts of the asset (or all the assets andliabilities in the group) are be measured in accordance with applicable Indian Accounting Standards. The sale should beexpected to qualify for recognition as a completed sale within one year from the date of classification except as permittedby Ind AS 105.
2.15 Inventories
Stocks of stores and spare parts, loose tools and materials-in-transit are valued at the lower of the net realizable valueand cost. The raw materials are also valued at the lower of the net realizable value and weighted average cost to the unitif the finished goods in which they will be incorporated are expected to be sold below cost. Loose tools when issued arecharged off to revenue.
Finished goods and work-in-process are valued at the lower of the net realizable value and weighted average cost to theunit. The cost is exclusive of financing cost, such as, interest, bank charges, administration overhead, etc. The value ofslag under work-in-process is taken at equivalent value to the extent credited to the process, where the said productshave been generated. The reverts under work- in-process are valued at lower of cost (equivalent value of concentrate)and net realizable value.
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-156
85
The stock of anode slime arising from treatment and refining processes are stated at realizable value based on theyearend London Metal Exchange price for gold and silver after making due adjustments of their physical recovery andthe treatment and refining charges.
The inventories out of inter-unit transfers (material in transit) at the close of the year are valued and accounted in thebooks of the transferor unit on the basis of cost plus transportation to the transferee unit.
Imported materials are valued at the lower of the net realizable value and weighted average cost. In the event wherefinal price is not determined valuation is made on provisional cost. Variations are accounted for in the year of finalization.
Provision is made in the accounts every year, for non-moving stores and spares (other than insurance spares) which havenot moved for more than five years. Insurance spares are fully provided for on the expiry of the life of the relevantProperty Plant and Equipments.
Physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all theunits at reasonable intervals during the year by a duly approved committee. Also, physical stock verification of WIP andFinished Goods is undertaken by a duly approved committee at the end of every financial year alongwith an independentagency once in a block of three years. In respect of Stores and Spares, physical verification is carried out by externalagencies once in every year covering all the units. Shortage/(Excesses), if any, identified on such physical verification isduly adjusted in the books of accounts in the year of identification
2.16 Government Grants
All government grants are recognized as deferred income and it will be taken to Statement of Profit and Loss over theperiod of time in accordance with the pattern in which the obligations are met.
2.17 Impairment of Assets (Other than Financial Assets)
The Company assesses at the end of each reporting period whether there is any indication that an asset may be impaired.If any such indication exists, the Company estimates the recoverable amount of the asset. If the recoverable amount of anasset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in Statement ofProfit and Loss, unless the relevant asset is carried at a revalue amount, in which case the impairment loss is treated asa revaluation decrease.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, theestimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects currentmarket assessments of the time value of money and the risks specific to the asset for which the estimates of future cashflows have not been adjusted.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increasedto the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carryingamount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit)in prior years. A reversal of an impairment loss is recognized immediately in Statement of Profit and Loss, unless therelevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluationincrease.
2.18 Foreign Exchange Transactions
Transactions in currencies other than the company's functional currency (foreign currencies) are recognized at the ratesof exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the ratesprevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are re-translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measuredin terms of historical cost in a foreign currency are not retranslated.
Foreign currency monetary items (except overdue recoverable where realizability is uncertain) are converted using theclosing rate as defined in the Ind AS-21. The effects of changes in Foreign Exchange Rates, non-monetary items arereported using the exchange rate at the date of the transaction. The exchange difference gain/loss is recognized in theStatement of Profit and Loss.
In case of long term foreign currency monetary items outstanding as of 31st March 2016,liability in foreign currencyloans relating to acquisition of fixed assets is converted using the closing rate as defined in Ind AS 21. The effects of
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-157
86
changes in Foreign Exchange Rates and the difference in exchange is recognized in terms of exemptions given in paragraphD13AA of Appendix D to Ind AS-101, where the effect of exchange differences on foreign currency loans of the company isaccounted for by addition or deduction to the cost of the assets so far it relates to the depreciable capital assets and shallbe depreciated over the balance life of the assets.
Other long term foreign currency monetary items are accumulated in 'Equity Component of Foreign Currency asset/liability Account' and amortized over the balance period of the asset/liability by recognition as income or expense in eachof such periods as stated under Para 29A of Ind AS 21.
2.19 Provisions, Contingent Liabilities & Contingent Assets
Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past eventand it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of theamount of the obligation.
Wherever no reliable estimate could be made, a disclosure is made as contingent liability. A disclosure for a contingentliability is also made when there is a possible obligation or a present obligation that may but probably will not require anoutflow of resources.
When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote,no provision or disclosure is made.
Contingent Liabilities are disclosed in the General Notes forming part of the accounts.
Contingent Assets are not recognised in the financial statements but are disclosed in Notes to the Accounts. Such assetsoccur when the inflow of economic benefits is probable. Such contingent assets are assessed continuously, if it is virtuallycertain that inflow of economic benefits will arise then such assets and the relative income will be recognised in thefinancial statements.
2.20 Leasing
Assets held under lease, in which a significant portion of the risks and rewards of ownership are transferred to lessee areclassified as finance leases. All other leases are classified as operating leases.
Depreciation expenses are recorded if asset held under finance lease is depreciable.
Finance expenses are recognized immediately in the Statement of Profit and Loss if they are not directly attributable toqualifying assets, otherwise they are capitalised in accordance with the company's general policy on borrowing costs.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term.
2.21 Financial InstrumentsNon Derivative Financial Instruments
(i) Initial RecognitionFinancial assets and financial liabilities are recognized when the company becomes a party to the contractualprovisions of the instruments.Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directlyattributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets andfinancial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financialassets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to theacquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediatelyin profit or loss.
(ii) Subsequent Recognitiona. Financial assets
Financial assets are subsequently measured at amortised cost, fair value through other comprehensive incomeor fair value through profit or loss.
b. Financial Liabilities
Financial liabilities are subsequently measured at amortized cost using Effective Interest Rate (EIR) methodexcept for derivatives, which are measured at fair value.
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-158
87
Derivative Financial Instruments
All derivatives are recognized and measured at fair value with changes in fair value being recognized in profit or loss forthe period.
Impairment of financial assets
At each reporting date, assessment is made whether the credit risk on a financial instrument has increased significantlyor not since initial recognition.
If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance ismeasured for that financial instrument at an amount equal to 12 month expected credit losses. If the credit risk on thatfinancial instrument has increased significantly since initial recognition, the loss allowance is measured for a financialinstrument at an amount equal to the lifetime expected credit losses.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date isrecognised as an impairment gain or loss in the Statement of Profit and Loss.
2.22 Events Occurring after the Reporting Period
The company adjusts the amount recognized in its financial statements to reflect adjusting material events after thereporting period and does not adjust the amount to reflect non-adjusting events after the reporting period. However,where retrospective restatement is not practicable for a particular prior period then the circumstances that lead to theexistence of that condition and the description of how and from where the error is corrected are disclosed in Notes onAccounts.
2.23 Dividend
Final dividend on shares is recorded as a liability on the date of approval by the shareholders in general meeting andinterim dividend is recorded as a liability on the date of declaration by the directors in the meeting of the Board ofDirectors.
2.24 Cash and Cash Equivalents
Cash and cash equivalent in the Balance Sheet comprise cash at bank and on hand and short term deposit with anoriginal maturity of three months or less which are subject to insignificant risk of changes in value.
2.25 Rounding of amounts
Amounts in these financial statements have, unless otherwise indicated, have been rounded off to ‘` in lakh’ upto twodecimal points.
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-159
88
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
Gros
s Car
ryin
g Am
ount
as a
t 01.
04.2
017
2446
.58
6547
.15
2344
3.61
443.
7020
3.72
1818
.91
293.
8726
47.2
644
4.81
3828
9.61
Exch
ange
Diff
eren
ces
- -
- -
- -
- -
- -
Addi
tions
-20
1.17
1405
.85
17.6
0 -
7.47
-28
.31
-16
60.4
0In
ter-h
ead
Adju
stm
ents
- -
- -
- -
- -
- -
Asse
ts cl
assif
ied
as h
eld
for s
ale
- -
5.67
- -
- -
- -
5.67
Disp
osal
s -
-(6
64.7
1) -
(14.
32)
- -
- -
(679
.03)
Tran
sfers
- -
- -
- -
- -
- -
Gro
ss C
arry
ing
Amou
nt a
s at
31.
03.2
018
2446
.58
6748
.32
2419
0.42
461.
3018
9.40
1826
.38
293.
8726
75.5
744
4.81
3927
6.65
Accu
mul
ated
Dep
recia
tion
& Im
pairm
ent
Accu
mul
ated
Dep
recia
tion
as a
t 01.
04.2
017
-38
7.61
1834
.75
65.4
912
.29
315.
2532
.67
202.
6113
.99
2864
.66
Depr
ecia
tion
char
ge d
urin
g th
e yea
r -
521.
2125
91.1
090
.32
34.5
933
8.24
32.6
724
2.22
13.9
938
64.3
4Im
pairm
ent L
osse
s -
-(1
2.40
) -
- -
- -
-(1
2.40
)Ex
chan
ge D
iffer
ence
s -
- -
- -
- -
- -
-In
ter-h
ead
Adju
stm
ents
- -
- -
- -
- -
- -
Asse
ts cl
assif
ied
as h
eld
for s
ale
- -
5.03
- -
- -
- -
5.03
Disp
osal
s -
-(6
31.1
2) -
(13.
60)
- -
- -
(644
.72)
Accu
mul
ated
Dep
recia
ton
& Im
pairm
ent a
s at 3
1.03.2
018
- 9
08.8
2 3
,787
.36
155
.81
33.
28 6
53.4
9 6
5.34
444
.83
27.
98 6
,076
.91
Net
Car
ryin
g Am
ount
as
at 3
1.03
.201
824
46.5
858
39.5
020
403.
0630
5.49
156.
1211
72.8
922
8.53
2230
.74
416.
8333
199.
74Gr
oss C
arry
ing
Amou
ntGr
oss C
arry
ing
Amou
nt a
s at 0
1.04
.201
824
46.5
867
48.3
224
190.
4246
1.30
189.
4018
26.3
829
3.87
2675
.57
444.
8139
276.
65Ex
chan
ge D
iffer
ence
s -
- -
- -
- -
- -
0.00
Addi
tions
-28
5.97
2667
.66
45.2
2 -
- -
88.8
5 -
3087
.70
Inte
r-hea
d T
rans
fer I
n /(O
ut)
-(3
01.0
0) 3
37.9
0(1
55.0
0) -
- -
118
.10
-0.
00Tr
ansfe
r Fro
m D
iscar
ded
Asse
ts -
- 0
.60
- 0
.20
- -
- -
0.80
Tran
sfer T
o Di
scar
ded
Asse
ts -
(0.4
6)(1
039.
16)
(33.
30)
(19.
26)
- -
(4.1
1)(0
.60)
(109
6.89
)Di
spos
als
- -
(29.
34)
(0.2
1)(2
.11)
- -
(0.1
7) -
(31.
83)
Impa
irmen
t Los
ses P
rov.
Trf
to D
iscar
ded
Asse
ts -
-46
4.01
- -
- -
- -
464.
01Ad
just
men
ts -
(3.9
8)(4
.03)
(0.1
4)0.
010.
01(0
.01)
(0.0
2) -
(8.1
6)G
ross
Car
ryin
g Am
ount
as
at 3
1.03
.201
924
46.5
867
28.8
526
588.
0631
7.87
168.
2418
26.3
929
3.86
2878
.22
444.
2141
692.
28Ac
cum
ulat
ed D
epre
ciatio
n &
Impa
irmen
tAc
cum
ulat
ed D
epre
ciatio
n as
at 0
1.04
.201
8 -
908.
8237
87.3
615
5.81
33.2
865
3.49
65.3
444
4.83
27.9
860
76.9
1De
prec
iatio
n ch
arge
dur
ing
the y
ear
-52
6.38
2749
.59
59.3
030
.62
333.
9032
.67
220.
1513
.99
3966
.60
Inte
r-hea
d T
rans
fer I
n /(O
ut)
-60
7.50
(610
.79)
(110
.30)
- -
-11
3.59
- -
Tran
sfer F
rom
Disc
arde
d As
sets
- -
- -
- -
- -
- -
Tran
sfer T
o Di
scar
ded
Asse
ts -
- -
- -
- -
- -
-Im
pairm
ent L
osse
s -
- -
- -
- -
- -
-Ex
chan
ge D
iffer
ence
s -
- -
- -
- -
- -
-Di
spos
als
- -
- -
- -
- -
- -
Accu
mulat
ed D
epre
ciato
n &
Impa
irmen
t as a
t 31.0
3.201
9 -
2042
.70
5926
.16
104.
8163
.90
987.
3998
.01
778.
5741
.97
1004
3.51
Net
Car
ryin
g Am
ount
as
at 3
1.03
.201
924
46.5
846
86.1
520
661.
9021
3.06
104.
3483
9.00
195.
8520
99.6
540
2.24
3164
8.77
Not
e : H
CL h
as u
sed
the e
xem
ptio
n av
aila
ble i
n In
d AS
101
with
resp
ect t
o rec
ogni
tion
of P
rope
rty,
Pla
nt, E
quip
men
t (PP
E) a
nd In
tang
ible
Ass
ets a
t the
ir ca
rryi
ng va
lue.
Desc
riptio
nFr
ee H
oldLa
ndBu
ildin
gs in
clu-
ding S
anita
ryan
d Wat
er S
upply
Syste
m
Plan
t,M
achi
nery
and M
inin
gEq
uipm
ent
Furn
iture
& Fi
xtur
es&
Offic
eEq
uipm
ent
Vehi
cles
Road
s,Br
idges
and
Culve
rts
Railw
aySi
ding
Elec
trica
lEq
uipm
ent
and
Insta
llatio
n
Shaft
san
dIn
cline
sTo
tal
Not
e: 3
(A) P
rope
rty,
Plan
t and
Equ
ipm
ent (
Activ
e As
sets
)
Gros
s Car
ryin
g Am
ount
(` in
lakh
)
F-160
89
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
Gros
s Car
ryin
g Am
ount
as a
t 01.
04.2
017
3.64
181.
4537
2.93
6.26
4.03
24.9
3 -
58.1
791
.70
743.
11Ex
chan
ge D
iffer
ence
s -
- -
- -
- -
- -
-Ad
ditio
ns -
- -
- -
- -
- -
-In
ter-h
ead
Adju
stm
ents
- -
- -
- -
- -
- -
Asse
ts cl
assif
ied
as h
eld
for s
ale
- -
- -
- -
- -
- -
Disp
osal
s -
- -
- -
- -
- -
-Tr
ansfe
rs -
- -
- -
- -
- -
-G
ross
Car
ryin
g Am
ount
as
at 3
1.03
.201
83.
6418
1.45
372.
936.
264.
0324
.93
-58
.17
91.7
074
3.11
Accu
mul
ated
Dep
recia
tion
& Im
pairm
ent
Accu
mul
ated
Dep
recia
tion
as a
t 01.
04.2
017
- -
- -
- -
- -
- -
Depr
ecia
tion
char
ge d
urin
g th
e yea
r -
- -
- -
- -
- -
-Im
pairm
ent L
osse
s -
- -
- -
- -
- -
-Ex
chan
ge D
iffer
ence
s -
- -
- -
- -
- -
-In
ter-h
ead
Adju
stm
ents
- -
- -
- -
- -
- -
Asse
ts cl
assif
ied
as h
eld
for s
ale
- -
- -
- -
- -
- -
Disp
osal
s -
- -
- -
- -
- -
-Ac
cum
ulat
ed D
epre
ciato
n &
Impa
irmen
t as a
t 31.0
3.201
8 -
- -
- -
- -
- -
-N
et C
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3.64
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4537
2.93
6.26
4.03
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58.1
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.70
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ss P
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sions
for D
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Pro
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-Gr
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83.
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936.
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-58
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91.7
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3.11
Exch
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Diff
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ces
- -
- -
- -
- -
- -
Addi
tions
- -
- -
- -
- -
- -
Inte
r-hea
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rans
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n /(O
ut)
- -
- -
- -
- -
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sfer F
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ive A
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0.4
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39.1
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.30
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26 -
- 4
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0.6
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96.8
9Tr
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sets
- -
(0.6
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(0.2
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- -
-(0
.80)
Disp
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s -
-(0
.64)
- -
- -
- -
(0.6
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pairm
ent L
osse
s -
-(4
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- -
- -
-(4
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1) A
djus
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- -
- -
- -
- -
-G
ross
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ryin
g Am
ount
as
at 3
1.03
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93.
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1.91
946.
8439
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.93
-62
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- -
- -
- -
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n ch
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- -
- -
- -
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- -
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- -
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sets
- -
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o Di
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- -
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- -
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ence
s -
- -
- -
- -
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- -
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- -
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Accu
mul
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& Im
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- -
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Net
Car
ryin
g Am
ount
as
at 3
1.03
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93.
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1.91
946.
8439
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924
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-62
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74.5
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ss P
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sions
for D
iscar
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Asse
ts13
74.5
5Ne
t Car
ryin
g Am
ount
(Net
of P
rovi
sions
) as a
t 31.0
3.201
9 -
Not
e : H
CL h
as u
sed
the
exem
ptio
n av
aila
ble
in In
d AS
101
with
resp
ect t
o re
cogn
ition
of P
rope
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Pla
nt, E
quip
men
t (PP
E) a
nd In
tang
ible
Ass
ets a
t the
ir ca
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ng v
alue
.
Desc
riptio
nFr
ee H
oldLe
ase H
oldLa
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ings
inclu
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g San
itary
and W
ater
Sup
plySy
stem
Plan
t,M
achi
nery
and M
inin
gEq
uipm
ent
Furn
iture
& Fi
xtur
es&
Offic
eEq
uipm
ent
Vehi
cles
Road
s,Br
idges
and
Culve
rts
Railw
aySi
ding
Elec
trica
lEq
uipm
ent
and
Insta
llatio
n
Shaft
san
dIn
cline
sTo
tal
Not
e: 3
(B) P
rope
rty,
Pla
nt a
nd E
quip
men
t (D
isca
rded
Ass
ets)
Gros
s Car
ryin
g Am
ount
(` in
lakh
)
F-161
90
ii) Non Trade Investment in Debentures 0.17 0.17
Less : Provision for diminution in value 0.17 - 0.17 -
TOTAL 18.50 -
AGGREGATE BOOK VALUE - UNQUOTED 18.50 -
AGGREGATE BOOK VALUE - QUOTED - -
MARKET PRICE OF QUOTED INVESTMENT - -
(` in lakh) As at As at
31st March, 2019 31st March, 2018
i) Building 24.22 168.04
ii) Plant & Machinery 33836.57 26737.53iii) Others including Mine Expansion 72439.01 42442.02
106299.80 69347.59Less: Provision 4088.49 3392.91TOTAL 102211.31 65954.68
Note No 5 NON - CURRENT FINANCIAL ASSETS - INVESTMENTS
i) Investments in equity instruments - (classified as at cost)Investment in Subsidiary Company - 18.50Chhattisgarh Copper Limited (CCL)
(Investment in CCL 185,000 Nos. (Previous Year Nil) ofequity shares of `10 (Previous Year Nil) each fullypaid up as at 31.03.2019)
Note No 6 NON - CURRENT FINANCIAL ASSETS - OTHERS
Bank deposits with more than 12 months maturity 12.47 1.44
TOTAL 12.47 1.44
Note No 4 CAPITAL WORK IN PROGRESS
PARTICULARS
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
Details of Subsidiary
Principal Activity and place Principal place of business Proportion of ownershipof incoporation interest / voting rights held
by the Company as on 31.03.2019
Exploration & Mining and benefication of copper Chhattisgarh 74%& its associated minerals
F-162
91
i) DEFERRED TAX ASSET
OPENING BALANCE 8780.81 8484.26Adjustment/Credit during the year 463.09 296.55CLOSING BALANCE 9243.90 8780.81
ii) DEFERRED TAX LIABILITYOPENING BALANCE (3203.10) (3325.92)Adjustment/Credit during the year 204.82 122.81CLOSING BALANCE (2998.28) (3203.10)
iii) DEFERRED TAX ASSETS / (LIABILITIES) (Net) (i-ii) 6245.62 5577.71(Refer Note No. 38 General Notes on Accounts Point No. 20)
Note No 7 DEFERRED TAX ASSETS (NET)
Income Tax (including advance income tax, TDS &excluding current tax liability) Unsecured - Considered good 620.33 983.43
TOTAL 620.33 983.43
Note No 8 NON-CURRENT TAX ASSETS (NET)
As at As atPARTICULARS 31st March, 2019 31st March, 2018
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-163
92
Note No 9 OTHER NON - CURRENT ASSETS
a) MOBILISATION ADVANCESi) Secured (considered good) 2178.89 2439.57ii) Unsecured (considered good)
– Against Bank Guarantee - - – Others - -
iii) Unsecured (considered doubtful) 0.02 0.02Less: Provisions for Capital Advances * 0.02 - 0.02 -
b) Other Loans & AdvancesReceivable from MPSEB 828.53 2822.26
c) Mine Development ExpenditureAs per Last Balance Sheet 53068.54 47067.49Add: Expenditure during the year (as per Note Below) 19898.22 19226.73
72966.76 66294.22Less: Value of Ore recovered during Mine Development 223.84 32.45Less: Amortisation during the Year 21627.10 21850.94 13193.23 13225.68
51115.82 53068.54Less: Provision 4664.86 4664.86
TOTAL 46450.96 48403.68
Note: MINE DEVELOPMENT EXPENDITURE DURING THE YEAR
i) Salaries, Wages, Allowances 2182.50 2444.39ii) Contribution to Provident & Other Funds 170.84 202.97
iii) Workmen & Staff Welfare Expenses 9.03 26.33iv) Stores, Spares & Tools Consumed 2369.33 3258.57v) Power, Fuel & Water 475.32 663.90
vi) Royalty 16.10 2.37vii) Repair & Maitenance 4222.59 1585.88
viii) Insurance 1.76 2.34ix) Overburden Removal Expenditure 9711.09 9939.12x) Depreciation 304.95 592.32
xi) Other Expenses 434.71 508.54
TOTAL 19898.22 19226.73
d) Prepaid ExpensesExpenses on Leasehold Land 3810.40 3638.42
TOTAL 3810.40 3638.42
TOTAL (a+b+c+d) 53268.78 57303.93
PROVISIONS FOR CAPITAL ADVANCES *
OPENING BALANCE 0.02 0.02Additions during the year - -Amount used during the year - -CLOSING BALANCE 0.02 0.02
The above expenditure is in addition to the expenses shown under the respective natural head of accounts indicatedand charged in the Statement of Profit and Loss Account for the year and in the relevant schedules thereof.Amortisation during the year is in relation to the expenses incurred on mines which are under operation/production and does not include expenditure on prospecting of minerals in new mines area.
As at As atPARTICULARS 31st March, 2019 31st March, 2018
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-164
93
(` in lakh)
As at As at31st March, 2019 31st March, 2018
Note No 10 INVENTORIES
i) Raw Materials - 69.21ii) Semi-Finished and In-Process 58249.42 73504.95
(at lower of cost or net realisable value)Less: Provision for Semi-Finished and In-Process* 123.03 58126.39 123.03 73381.92
iii) Finished Goods (at lower of cost or net realisable value) 1176.03 257.24iv) Stores and spares 7371.35 7197.51
Stores in transit/ pending inspection 309.03 489.887680.38 7687.39
Less: Provision for Obsolete Stores & Spares ** 2616.03 5064.35 2534.25 5153.14
TOTAL 64366.77 78861.51
PROVISION FOR SEMI-FINISHED AND IN-PROCESS *OPENING BALANCE 123.03 136.27Additions during the year - -Amount used during the year - 13.24
CLOSING BALANCE 123.03 123.03
PROVISION FOR OBSOLETE STORES & SPARES **OPENING BALANCE 2534.25 2512.18Additions during the year 106.81 40.00Amount used during the year 25.03 17.93
CLOSING BALANCE 2616.03 2534.25
Particulars
Note No 11 CURRENT FINANCIAL ASSETS - INVESTMENTS
Investments in Mutual Fund Number of units NAV (in `)(Maturity within 3 monthsfrom date of original investments)UTI MONEY MARKET - GROWTH 51.736 2112.55 1.09 1.01
(51.736) (1949.74)SBI ULTRA SHORT TERM DEBT FUND - GROWTH 132.120 4169.40 5.51 5.08
(132.120) (3843.07)CANARA REBECO LIQUID FUND - GROWTH 38.993 2258.68 0.88 0.82
(38.993) (2101.53)IDBI LIQUID FUND - GROWTH 68.469 2002.99 1.37 1.27
(68.469) (1860.48)
TOTAL 8.85 8.18
AGGREGATE BOOK VALUE - UNQUOTED Nil Nil
AGGREGATE BOOK VALUE - QUOTED 7.84 7.84
MARKET PRICE OF QUOTED INVESTMENT 8.85 8.18
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-165
94
DEBTS OUTSTANDINGi) - Secured - Considered good 36154.83 8157.36ii) - Unsecured - Considered good - -iii) - Considered doubtful 942.77 935.89
37097.60 9093.25Less: Allowances for bad & doubtful debts* 942.77 36154.83 935.89 8157.36
TOTAL 36154.83 8157.36
ALLOWANCES FOR BAD & DOUBTFUL DEBTS *
OPENING BALANCE 935.89 934.59Additions during the year 22.46 1.30Amount used during the year 15.58 -
CLOSING BALANCE 942.77 935.89
Explanatory Note: -Debt due by Directors or other officers of the company or any of them either severally or jointly with any other person ordebts due by firms or private companies respectively in which any Director of the Company is a partner or a Director ora member amounts to ` Nil (Previous year ` Nil).
Note No 12 CURRENT FINANCIAL ASSETS - TRADE RECEIVABLES
Particulars
(` in lakh)
As at As at31st March, 2019 31st March, 2018
Note No 13 CURRENT FINANCIAL ASSETS - CASH & CASH EQUIVALENTS
I. CASH AND CASH EQUIVALENTS
i. Cash on hand including imprest 0.25 0.25ii. Balance with Banks
-Current Account 658.17 614.53
II. OTHER BALANCES WITH BANKBank deposits upto 3 months maturity fromdate of original investment- with scheduled banks - 264.89
TOTAL 658.42 879.67
Note No 14 CURRENT FINANCIAL ASSETS - BANK BALANCE OTHER THAN CASH & CASH EQUIVALENTS
I. Other Balances with Bank- in Dividend Balance Account 15.86 12.38
II. Bank deposits with more than 3 months and upto 12 months maturity- with scheduled banks 408.33 379.16
TOTAL 424.19 391.54
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-166
95
Note No 15 CURRENT FINANCIAL ASSETS - OTHERSa) ADVANCES
Employees- Secured (considered good) 69.84 71.89- Unsecured (considered doubtful) 2.03 2.03Less : Provisions for doubtful advances * 2.03 2.03
69.84 71.89b) INTEREST ACCRUED ONi) LC from Customers 0.78 6.38ii) Investments 9.16 -iii) Deposits 23.92 37.21iv) Others 0.58 34.44 72.07 115.66
c) CLAIMS RECOVERABLEClaims recoverable from different agencies 3308.75 4649.14Less: Provision for Doubtful Claims ** 133.10 3175.65 133.14 4516.00
TOTAL (a+b+c) 3279.93 4703.55
DETAILS OF PROVISIONSPROVISION FOR DOUBTFUL ADVANCES *OPENING BALANCE 2.03 -Additions during the year - 2.03Amount used during the year - -
CLOSING BALANCE 2.03 2.03
PROVISION FOR DOUBTFUL CLAIMS **
OPENING BALANCE 133.14 133.14
Additions during the year - -Amount used during the year 0.04 -
CLOSING BALANCE 133.10 133.14
Explanatory Note: -PARTICULARS OF LOANS AND ADVANCES DUE FROM DIRECTORSi) Amount due at the end of the year ` Nil ` Nilii) Advance due by firms or private companies in which any Director
of the Company is a Partner or a director or a member amounts to `Nil (Previous year `Nil)
Particulars As at 31st March, 2019 As at 31st March, 2018(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-167
96
(` in lakh)
a) Advances to contractors / suppliers- Secured (considered good) 218.29 695.91- Unsecured (considered good)
– Against Bank Guarantee - - – Others 2099.84 967.26
- Unsecured (considered doubtful) 723.33 714.713041.46 2377.88
b) Other Advances- secured (considered good) 50.90 41.07- Unsecured (considered doubtful) 13.93 13.93
64.83 55.003106.29 2432.88
Less : Provision for Doubtful Loans and Advances * 737.26 728.632369.03 1704.25
c) Advance to Subsidiary-CCL 6.50 -
d) DEPOSITSOther Deposits 9392.51 8813.05Less : Provision for Doubtful Deposits ** 75.56 75.56
9316.95 8737.49e) OTHER CURRENT ASSETS
Other Current Assets 277.33 419.67Less: Provision for Other Current Assets *** 3.52 3.52
273.81 416.15f) OTHER RECOVERABLES
IGST/CGST & SGST 20001.05 11753.73
g) PREPAID EXPENSESRent for Leasehold Land 141.29 114.32
TOTAL 32108.63 22725.94
DETAILS OF PROVISIONS
PROVISION FOR DOUBTFUL LOANS AND ADVANCES *
OPENING BALANCE 728.63 220.51
Additions during the year 8.63 510.15Amount used during the year - 2.03
CLOSING BALANCE 737.26 728.63
PROVISIONS FOR DOUBTFUL DEPOSITS **
OPENING BALANCE 75.56 75.56Additions during the year - -Amount used during the year - -
CLOSING BALANCE 75.56 75.56
PROVISION FOR OTHER CURRENT ASSETS ***
OPENING BALANCE 3.52 3.52Additions during the year - -Amount used during the year - -
CLOSING BALANCE 3.52 3.52
Note No 16 OTHER CURRENT ASSETS
Particulars As at 31st March, 2019 As at 31st March, 2018
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-168
97
Note No 17 EQUITY SHARE CAPITAL
Particulars As at 31st March, 2019 As at 31st March, 2018
In No. (` in lakh) In No. (` in lakh)a) AUTHORISED SHARE CAPITAL
- Equity Share Capital 1800000000 90000.00 1800000000 90000.00- 7.50% Non-Cum. Redeemable Preference Shares 2000000 20000.00 2000000 20000.00
b) PAR VALUE PER EQUITY SHARE (in `) 5.00 5.00c) PAR VALUE PER PREFERENCE SHARE (in `) 1000.00 1000.00
d) NO. OF SHARES ISSUED, SUBSCRIBED AND FULLY PAID UP
- Equity Share Capital 925218000 46260.90 925218000 46260.90
- 7.50% Non-Cum. Redeemable Preference Shares - - - -
TOTAL 46260.90 46260.90
e) RECONCILIATION OF NO. OF SHARES & SHARE CAPITAL
OUTSTANDING: No. of Shares (` in lakh) No. of Shares (` in lakh)
OUTSTANDING AS ON 01.04.2018 925218000 46260.90 925218000 46260.90Add: Share Capital issued/ subscribed during the year - - - -Less: Reduction in Share Capital - - - -
OUTSTANDING AS ON 31.03.2019 925218000 46260.90 925218000 46260.90
f) TERMS/RIGHTS ATTACHED TO EQUITY SHARES
The Company has only one class of Equity Shares having par value of 5/- each and is entitled to one vote per share.
g) SHARES IN THE COMPANY HELD BY EACH SHAREHOLDER
HOLDING MORE THAN 5 PERCENT OF THENUMBER OF SHARES In No. (%) In No. (%)
- President of India 703587852 76.05% 703587852 76.05%- Life Insurance Corporation of India 112338152 12.14% 112338152 12.14%
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-169
98
a) CAPITAL RESERVE *AS PER LAST BALANCE SHEET 21166.24 21166.24
b) GENERAL RESERVE
AS PER LAST BALANCE SHEET 8965.97 8965.97
c) CORPORATE SOCIAL RESPONSIBILITY FUNDAS PER LAST BALANCE SHEET 22.78 222.90Add: During the year - -Less: Amount reversed during the year - -Less: Amount used during the year 22.78 200.12
AS AT BALANCE SHEET DATE - 22.78
d) MINE CLOSURE RESERVEAS PER LAST BALANCE SHEET - -Add: During the year 163.00 -Less: Amount reversed during the year - -Less: Amount used during the year - -AS AT BALANCE SHEET DATE 163.00 -
f) CURRENCY FLUCTUATION RESERVE **AS PER LAST BALANCE SHEET - -Add: Equity Component of Foreign Currency Loan 155.94 -Less: Amount reversed during the year - -Less: Amount used during the year - -AS AT BALANCE SHEET DATE 155.94 -
g) RETAINED EARNING *** 86399.44 76313.10
TOTAL 116850.59 106468.09
Details of Retained Earning ***Profit for the year as per Statement of Profit and Loss 14551.05 7960.53Other Comprehensive Income as per Statement of Profit and Loss (1676.21) 499.52Total Comprehensive Income for the period 12874.84 8460.05Balance brought forward 76313.10 70080.18BALANCE AVAILABLE FOR APPROPRIATION 89187.94 78540.23
i) Less :Dividend 2313.05 1850.43ii) Less :Tax on Dividend 475.45 376.70
BALANCE CARRIED FORWARD 86399.44 76313.10
* Capital Reserve is created from the Grant received from the Government of India during the approval of Financial Re-structuring proposal by Ministry of Mines and out of Capital Profits over the years.This Reserve is not created out ofRevenue Profits of the Company.
** Currency Fluctuation Reserve is not created out of Revenue Profits of the Company.
Note No 18 OTHER EQUITY
Particulars As at 31st March, 2019 As at 31st March, 2018
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
(` in lakh)
F-170
99
Note No 19 NON-CURRENT FINANCIAL LIABILITIES - BORROWINGS
Particulars As at 31st March, 2019 As at 31st March, 2018
(` in lakh)
LONG TERM LOANS• From Banks/ FIs
- Secured- EXIM Bank (Loan I) 5443.02 10208.27
- EXIM Bank (Loan II) 28215.21 -(First pari-passu charge on movable fixed assets, both present andfuture of the Company, excluding GCP and TCP) - SBI 17407.50 -(First pari-passu charge on immovable fixed assets of the Companylocated at MCP, both present and future , excluding leaseholdland/property)- Unsecured- Axis Bank 6000.00 -TOTAL 57065.73 10208.27
(The title deeds for Freehold and Leasehold Land and Building acquiredin respect of Gujarat Copper Project are yet to be executed. Pending thesame, the title deeds of land of TCP has been submitted as an alternatesecurity over which no hypothecation has been created.)
Note No 20 NON-CURRENT FINANCIAL LIABILITIES - OTHERS
OTHERS (Compensation received from Govt of Jharkhand 843.53 923.57for repair of township)
TOTAL 843.53 923.57
Note No 21 NON-CURRENT PROVISIONS
PROVISION FOR EMPLOYEE BENEFITS
i) PROVISION FOR LEAVE ENCASHMENTAS PER LAST BALANCE SHEET 11930.19 9499.65Additions during the year - 2430.54Amount used during the year 1009.87 -
CLOSING BALANCE 10920.32 11930.19
ii) PROVISION FOR GRATUITYAS PER LAST BALANCE SHEET (3743.46) (1570.92)Additions during the year 1094.73 (772.54)Amount used/funded during the year 2800.00 1400.00
CLOSING BALANCE (5448.73) (3743.46)
TOTAL 5471.59 8186.73
(Refer Note No. 38 General Notes on Accounts Point No. 22)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-171
100
SHORT TERM LOANSi) From Banks/ FIs
- Secured (Secured by hypothecation of Stock-in-Trade,Stores & Spare Parts and Book Debts, both present andfuture of the Company) 16503.81 9480.56
ii) Working Capital Term Loan (Unsecured)- Axis Bank 9702.84 25045.72- Kotak Mahindra Bank - 8027.29- HDFC Bank 13000.00 -
iii) Buyers' Credit - 7850.97
LONG TERM LOANS• Due in next 1 yeari) EXIM Bank (Loan I) 5443.04 5082.27ii) EXIM Bank (Loan II) 1795.51 -iii) Axis Bank 3500.00 -
TOTAL 49945.20 55486.81
Note No 23 CURRENT FINANCIAL LIABILITIES - TRADE PAYABLE
i) Total outstanding dues of micro entreprises and small enterprises 535.45 596.98ii) Total outstanding dues of creditors other than micro
enterprises and small enterprises 19693.63 22016.37
TOTAL 20229.08 22613.35
Note No 24 CURRENT FINANCIAL LIABILITIES - OTHERS
i) Interest accrued but not due on borrowings & term loans 359.97 236.77ii) Unpaid dividend 15.86 12.38iii) Deposits/ Retention money 5885.05 4718.95iv) Other liabilities 1339.49 641.22
TOTAL 7600.37 5609.32
Note No 25 OTHER CURRENT LIABILITIES
i) Statutory dues payables 4664.42 4594.81ii) Advances from Customers 1977.75 4204.92iii) Sundry Creditors - Others 12238.53 8350.91
TOTAL 18880.70 17150.64
Note No 22 CURRENT FINANCIAL LIABILITIES - BORROWINGS
Particulars As at 31st March, 2019 As at 31st March, 2018
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-172
101
Note No 26 CURRENT PROVISIONS
Particulars As at 31st March, 2019 As at 31st March, 2018
(` in lakh)
a) PROVISION FOR EMPLOYEE BENEFITSi) PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 741.60 2131.53Additions during the year 1239.25 -Amount used during the year - 1389.93CLOSING BALANCE 1980.85 741.60
ii) PROVISION FOR GRATUITYAS PER LAST BALANCE SHEET (3513.13) (4037.88)Additions during the year 652.24 524.75Amount used during the year - -CLOSING BALANCE (2860.89) (3513.13)
iii) PROVISION FOR LEAVE TRAVEL CONCESSION (LTC)AS PER LAST BALANCE SHEET 139.11 103.63Additions during the year 32.82 35.48Amount used during the year - -CLOSING BALANCE 171.93 139.11
iv) PROVISION FOR PRP/INCENTIVEAS PER LAST BALANCE SHEET 882.00 375.00Additions during the year 1145.00 582.00Amount used during the year 300.00 75.00CLOSING BALANCE 1727.00 882.00
v) PROVISION FOR WAGE REVISIONAS PER LAST BALANCE SHEET 5621.17 5953.00Additions during the year - 720.00Amount used during the year 1362.90 1051.83CLOSING BALANCE 4258.27 5621.17
b) OTHERSi) DIVIDEND
AS PER LAST BALANCE SHEET - -Additions during the year 2313.05 1850.43Amount used during the year 2313.05 1850.43CLOSING BALANCE - -
ii) TAX ON DIVIDENDAS PER LAST BALANCE SHEET - -Additions during the year 475.45 376.70Amount used during the year 475.45 376.70CLOSING BALANCE - -
iii) PROVISION - OTHERSAS PER LAST BALANCE SHEET 1366.75 2221.50Additions during the year 32.31 3594.89Amount used during the year 380.47 4449.64CLOSING BALANCE 1018.59 1366.75
TOTAL 6295.75 5237.50
(Refer Note No. 38 General Notes on Accounts Point No. 21)
Additions during the year 8644.62 4639.68Less : Refund pertaining to earlier years 310.58 -Less : Advance Income Tax & TDS 6750.08 4036.18Current Tax Liabilities (Net of Advance Tax & TDS) 1583.96 603.50
Note No 27 CURRENT TAX LIABILITIES (Net)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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Note No 28 REVENUE FROM OPERATIONS
SALE OF PRODUCTS- Domestic 91076.52 130721.75- Export 84267.33 34068.94
175343.85 164790.69
Less : Discount & Rebate 14.55 1322.37SALES (Net of Discounts) (A) 175329.30 163468.32
SALE OF SERVICES (B) 455.70 150.69
OTHER OPERATING INCOME (C)-Sale of Scrap 987.36 1415.89-Interest received from Customers 246.35 229.79-Interest received from Contractors against mobilizationadvances for mining operations 262.80 297.07- Penalty & Liquidated Damages 1752.00 495.32Less : Refunded during the year 203.57 1548.43 584.72 (89.40)-Excess Electricity Charges earlier paid adjusted byMPSEB against current Electricity bills 2795.78 4572.98(Refer Note No. 38 General Notes on Accounts Point No.12)- Exchange Rate Variation (Net) - 545.54TOTAL (C) 5840.72 6971.87 TOTAL (A+B+C) 181625.72 170590.88
Note No 29 OTHER INCOME- Claims Received 10.44 28.32- Interest from Term Deposits 96.62 346.17- Interest - Others 237.87 833.71- Profit on sale of Assets 48.24 -- Profit on Sale of Investment - 7.79- Profit on Fair Value of Investment 0.67 0.34- Others 2176.74 1513.27- Provisions not required written back # 1095.29 1376.96TOTAL 3665.87 4106.56
Details of Provisions not required written back #(Refer Note No.38 General Notes on Accounts Point No.13)Bad and doubtful Debts,advances/deposits & claims 16.56 0.12Excess provisions on account of shortage,non-moving,Obsolete & insurance Stores & Spares and finished goods 26.93 30.17Provision for Discarded Assets no longer required 1.16 0.64Provision for CSR no longer required Written Back 30.59 -Provision for Interest on MSME 169.94 143.45Provision for MP Rural Infrastructure & RoadDevelopment Tax & Water Charges 370.78 -Old Liability Written Back for S.Creditors, SD & EMDmore than 5 years and Others 479.33 6.66Provision for Impairment Loss - 12.40Liability for DMF & NMET on Royalty earlier provided no longer required - 1183.52TOTAL 1095.29 1376.96
Particulars
(` in lakh)For the year ended
31st March, 2019For the year ended
31st March, 2018
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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Particulars
(` in lakh)For the year ended
31st March, 2019For the year ended
31st March, 2018
Raw Materials Consumed 6269.57 41105.56
Value of Ore Raised During Mine Development 223.84 32.45
TOTAL 6493.41 41138.01
Note No 31 CHANGES IN INVENTORIES OF FINISHED GOODS,SEMI-FINISHED AND WORK- IN-PROCESS
A. OPENING STOCK:Finished Goods 257.24 6090.23Semi-Finished and In-Process 73504.95 66947.31TOTAL OPENING STOCK 73762.19 73037.54
B. CLOSING STOCK:Finished Goods 1176.03 257.24Semi-Finished and In-Process 58249.42 73504.95TOTAL CLOSING STOCK 59425.45 73762.19
(INCREASE)/ DECREASE (A-B) 14336.74 (724.65)
Note No 32 EMPLOYEES BENEFIT EXPENSE
Salaries, Wages & Allowances 23320.29 23931.35Bonus/Ex-gratia/Performance Related Pay 1426.21 749.68Contribution to Provident & Other Funds 2263.98 2337.91Workmen & Staff Welfare Expenses 1696.74 1710.95Gratuity & Leave Encashment 2944.26 4058.95
TOTAL 31651.48 32788.84
Explanatory Note: -The detail of Remuneration paid/payable to Directors as included in above payments are as follows: -
(i) Salaries & Allowances 212.32 123.20(ii) Contribution to Provident & Other Funds 13.99 10.70(iii) Re-imbursement of Medical Expenses 0.53 0.86(iv) Leave Encashment 13.23 24.09(v) Gratuity paid 10.00 14.42
TOTAL 250.07 173.27
In addition the Whole-time Directors are allowed the use of company car for private purpose and have been provided withresidential accomodation as per terms of their appointment / Government guidelines and the charges are recovered at the ratesprescribed by the Government.
Note No 33 FINANCE COST
- Interest on Cash Credit 1339.00 533.62- Others ( including Term Loans) 4207.10 1595.03
TOTAL 5546.10 2128.65
Note No 30 COST OF MATERIALS CONSUMED
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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Note No 34 DEPRECIATION AND AMORTISATION EXPENSE
Particulars
(` in lakh)For the year ended
31st March, 2019For the year ended
31st March, 2018
A. DEPRECIATIONDepreciation for the year 3966.60 3864.34Less: Depreciation transferred to Mine Development Expenditure 304.95 592.32SUB TOTAL (A) 3661.65 3272.02
B. AMORTISATIONAmortisation during the year * 21627.10 13193.23SUB TOTAL (B) 21627.10 13193.23TOTAL (A+B) 25288.75 16465.25
* Amortisation during the year is in relation to the expenses incurred on mines which are under operation/productionand does not include expenditure on prospecting of minerals in new mines area.
Note No 35 OTHER EXPENSES
A. OTHER MANUFACTURING EXPENSES- Stores, Spares & Tools Consumed 11706.53 11594.58- Consumption of Power, Fuel & Water 22186.57 21120.53- Royalty, Cess & Decretal amount 9803.47 8766.16- Contractual Job for Process 13905.88 9287.06- Handling & Transportation 6811.67 7224.71- Tolling Charges - 82.71- Expenses for Leasehold Land 141.29 114.32SUB TOTAL (A) 64555.41 58190.07
B. REPAIRS & MAINTENANCE & MAJOR OVERHAUL EXPENSES- Building 195.08 139.45- Machinery 4889.34 2711.59- Others 681.86 366.61SUB TOTAL (B) 5766.28 3217.65
C. ADMINISTRATION EXPENSES- Insurance 204.77 131.91- Rent 134.42 180.50- Rates and Taxes 766.15 1176.06- Security Expenses 970.41 679.60- Travelling and Conveyance 562.57 405.71- Telephone, Telex and Postage 143.77 129.93- Advertisement and Publicity 174.90 100.89- Printing and Stationery 125.70 52.57- Books & Periodicals 3.63 9.40- Consultancy Charges - Indigenous 751.17 275.71- Loss on Sale of Assets(Net) - 1.71- Exchange Rate Variation(Net) 0.17 -- Bad debts / advances/ claims written off - 56.83- MTM Debit Foreign Exchange 1071.48 211.68- MTM Debit/Credit & Hedging Expenses 821.07- Research & Development Expenses 157.59- Corporate Social Responsibility Expenses 185.38 142.83- Hire Charges 387.75 286.81- Audit Expenses (Refer detail below at Sl 1) 30.13 29.46- Independent Directors Expenses 10.35 3.60- Bank Charges 155.01 229.38- Other General Expenses 1041.33 1051.23SUB TOTAL (C) 6719.09 6134.47
D. Excise Duty - 3542.72Net impact of Excise Duty on Closing Stock - (1409.25)SUB TOTAL (D) - 2133.47
E. PROVISIONS (Refer detail below at Sl 2) 1899.68 1022.14TOTAL (A+B+C+D+E) 78940.47 70697.80
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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Note No 35 OTHER EXPENSES (Contd.)
Particulars For the year ended31st March, 2019
For the year ended31st March, 2018
Explanatory Note: -1) Detail of Audit Expenses are as under: -
i) Statutory Auditors- Statutory Audit Fees 11.00 8.35- Tax Audit Fees 0.89 0.89-In Other Capacity 8.65 8.01- Reimbursement of Expenses 5.81 26.35 8.27 25.52
ii) Cost Auditors- Cost Audit Fees 0.61 0.61- Reimbursement of Expenses 0.86 1.47 0.78 1.39
iii) Internal Auditors- Audit Fees 0.65 0.65- Reimbursement of expenses 1.66 2.31 1.90 2.55TOTAL 30.13 29.46
2) Detail of Provisions are as under: -Doubtful debts - 1.30Doubtful advances / deposits 9.82 510.26Prov. For Obsolete /Non-moving Stores 108.71 7.85Prov. For Discrepency of Stores & Spares - 32.15Prov. For Capital Work in Progress 695.58 -Prov. For Assets 631.54 0.44Interest on MSMED 291.03 232.09Provision for Mine Closure Expenditure 163.00 -Provision for Others - 238.05TOTAL 1899.68 1022.14
Note No 36 TAX EXPENSE
CURRENT TAX Income Tax Provision 8656.75 4639.68 Income Tax relating to earlier years 472.18 -Deferred Tax Account (667.91) (419.36)
TOTAL 8461.02 4220.32
Note No 37 OTHER COMPREHENSIVE INCOME
A (i) Items that will not be reclassified to Profit/LossActurial gain/loss recognised in the year for employees :Gratuity (1676.21) 499.52
TOTAL (A(i)) (1676.21) 499.52A (ii) Income Tax relating to items that will not be
reclassified to Profit & Loss - -TOTAL (A(ii)) - -
B (i) Items that will be reclassified to Profit/Loss -
TOTAL (B(i)) - -
B (ii)Income Tax relating to items that will be reclassified to Profit & Loss - -
TOTAL (B(ii)) - -
Explanatory Note: -1) Detail of Audit Expenses are as under: -
i) Statutory Auditors- Statutory Audit Fees 11.00 8.35- Tax Audit Fees 0.89 0.89-In Other Capacity 8.65 8.01- Reimbursement of Expenses 5.81 26.35 8.27 25.52
ii) Cost Auditors- Cost Audit Fees 0.61 0.61- Reimbursement of Expenses 0.86 1.47 0.78 1.39
iii) Internal Auditors- Audit Fees 0.65 0.65- Reimbursement of expenses 1.66 2.31 1.90 2.55TOTAL 30.13 29.46
2) Detail of Provisions are as under: -Doubtful debts - 1.30Doubtful advances / deposits 9.82 510.26Prov. For Obsolete /Non-moving Stores 108.71 7.85Prov. For Discrepency of Stores & Spares - 32.15Prov. For Capital Work in Progress 695.58 -Prov. For Assets 631.54 0.44Interest on MSMED 291.03 232.09Provision for Mine Closure Expenditure 163.00 -Provision for Others - 238.05TOTAL 1899.68 1022.14
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-177
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38 GENERAL NOTES ON ACCOUNTS
1.CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)
(i) Contingent Liabilities:
Details of Claims against the Company not acknowledged as debt (of 1(i)(a) above)VAT/CST/ENTRY TAX
There are demand notices totaling to Gross Demand of 3347.51 lakh (Previous Year ` 2072.32 lakh) from various StateRevenue Authorities regarding VAT/CST/Entry Tax against which the company has deposited under protest of` 610.33 lakh (Previous Year ` 610.33 lakh). The company is contesting the demand and the management as well as thelegal advisors/consultants are of the opinion that its contention will likely to be upheld by the Appellate Authorities. Thecompany also believes that ultimate outcome of these proceedings will not have a material adverse impact on the financialposition of the company.
EXCISE DUTY
There are demand notices totaling to Gross Demand of ` 5747.41 lakh (Previous Year ` 5250.33 lakh) from CentralExcise Authorities regarding Excise Duty against which the company has deposited under protest of ` 30.34 lakh(Previous Year ` 20.77 lakh). The company is contesting the demand and the management as well as the legal advisors/consultants are of the opinion that its contention will likely to be upheld by the Appellate Authorities. The company alsobelieves that ultimate outcome of these proceedings will not have a material adverse impact on the financial position ofthe company.
INCOME TAX & PROVIDENT FUND
There are Income Tax & Provident Fund demand notices totaling to Gross Demand of ` 11101.54 lakh (Previous Year` 10560.28 lakh) against which the company has deposited under protest of ` 72.31 lakh (Previous Year ` Nil). Thecompany is contesting the said demands before the High Court and Appellate Authorities. The management as well asthe income tax /provident fund consultant are of the opinion that its contention will likely to be upheld by the AppellateAuthorities. The company also believes that ultimate outcome of these proceedings will not have a material adverseimpact on the financial position of the company.
i. Disputed VAT / CST / Entry Tax 3347.51 2072.32ii. Disputed Excise Duty 5747.41 5250.33
iii. Disputed Income Tax / Provident Fund 11101.54 10560.28iv. Other Demand 34578.47 34152.67
SUB-TOTAL (A) 54774.93 52035.60b. Other money for which the company is contingently liable :i. Bank Guarantee 2585.42 2671.66
ii. Letter of Credit 1894.47 2063.09iii. Bill discounting 6636.44 200.24
SUB-TOTAL (B) 11116.33 4934.99GRAND TOTAL (A+B) 65891.26 56970.59
(ii) Commitments:-Estimated amount of contracts remaining to be executed on capitalaccount and not provided for (Net of advance and deposit) 86661.55 125671.75
a. Claims against the company not acknowledged as debt : 2018-19(` in lakh)
2017-18 (` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-178
107
OTHER DEMAND of ` 34578.47 lakh (Previous Year ` 34152.67 lakh)The major pending litigation cases are as follows:a. The Municipal Council, Malanjkhand, raised a demand on Malanjkhand Copper Project (MCP) amounting to 7046.64
lakh on account of penalty on Terminal Tax for the periods from financial year 2000-01 to 2005-06 on the ground ofshort payment of Terminal Tax by adopting higher assessable value as well as higher of Metal in Ore (MIO) producedand Metal in Concentrate (MIC) despatched. The matter was contested by the company before the Hon'ble HighCourt, Jabalpur, M.P. and the company paid ` 352.33 lakh towards penalty Terminal Tax as per the order of Hon'bleHigh Court, Jabalpur, M.P. Subsequently the matter was turned down by the Hon'ble High Court, Jabalpur, M.P.The Company filed writ petition before the Hon'ble Supreme Court of India. The Hon'ble Supreme Court vide itsorder dated 29.07.2011 directed the Company to deposit an ad-hoc amount of ` 1000.00 lakh to Municipal Council,Malanjkhand which has since been deposited by the company and shown as 'Deposits with Court' and also orderedthat the matter may be heard on the ground of merit by the Civil Court, Baihar. Further a demand of ` 18867.56lakh for the periods from 2006-07 to 2011-12 was also raised on the above ground for which the appeal by thecompany is pending before the Hon'ble Supreme Court. Pending final decision, the full amount of ` 25914.20 lakhhas been disclosed under 'Contingent Liability'.
b. The Municipal Council, Malanjkhand, Madhya Pradesh issued demands on MCP for ` 558.24 lakh on account ofProperty Tax for several years against which the company filed writ petitions before the Hon'ble Madhya PradeshHigh Court, Jabalpur challenging the demand notice. The amount of 558.24 lakh has been included under 'ContingentLiability'.
c. There was a trade dispute with M/s Bhagawati Gases Ltd (BGL) in connection with an agreement to supply ofgaseous oxygen at Khetri Copper Complex. The dispute was referred to Arbitration. The claim of BGL is for anamount of ` 1079.80 lakh with a corresponding counter claim of ` 534.62 lakh by the company. The arbitral awardwent against the company. The company had filed an appeal before the Hon'ble High Court of Rajasthan and thesame was admitted for hearing. The Company preferred appeal before the Hon'ble Rajasthan High Court regardinginterim deposit of arbitral award pending disposal of original appeal, but the same was dismissed. Thereafter theCompany had preferred appeal before Hon'ble Supreme Court and the Hon'ble Supreme Court passed the orderdirecting the Company to deposit the entire decrial amount along with interest amounting to ` 1733.50 lakh in theform of Fixed Deposit. The Company deposited the said amount and shown the same as Deposit in Current Assets.Pending decision of the original appeal against arbitral award before the Hon'ble Rajasthan High Court, the saidamount of ` 1733.50 lakh has been disclosed under 'Contingent Liability'.
d. There was a demand from M/s Uttkal Moulders amounting to ` 1662.72 lakh regarding interest for delayed paymentagainst supply of grinding media balls at Malanjkhand Copper Project. The case is pending before the Sole Arbitrator.Pending final decision, the said amount of ` 1662.72 lakh has been disclosed under 'Contingent Liability'.
e. In addition there are number of pending litigation cases against the company claiming demand of ` 4709.81 lakh byretired employees, third parties etc. which the company is contesting before different Legal Forums / Courts.The management as well as the legal advisors/consultants are of the opinion that its position will likely to be upheldin the appellate proceedings. The company also believes that ultimate outcome of these proceedings will not have amaterial adverse impact on the financial position of the company.
2. During the year, the company has made a provision amounting to ` 1145.00 lakh (Previous Year ` 582.00 lakh) interms of DPE guidelines towards Performance Related Pay payable to the executives for F.Y. 2018-19 which is shownunder 'Employees Benefit Expense'.
3. Lease premium paid for land for mining purposes including payment for Net Present Value (NPV) of forest area paidto forest department is capitalized under the head Prepaid Expenses shown under Note No. 9(d) & 16(g).
4. At Indian Copper Complex (ICC) certain freehold lands acquired through nationalization in accordance with IndianCopper Corporation (Acquisition of Undertaking) Act, 1972, for which title deeds, conveyance deeds etc. are not in thepossession of the company. The lease agreements of Kendadih, Rakha and Surda Mining Lease at ICC with the StateGovernment has been renewed in respect of leasehold lands valid upto 31.03.2020.
5. The commercial operation of Smelter, Refinery and Sulphuric Acid Plant at Khetri Copper Complex (KCC) weresuspended since December 2008. The Company suffered loss on account of impairment of the said plants valued byan independent consultant and consequently a total sum of 464.01 lakh (Previous Year 482.97 lakh) was providedin the accounts for impairment loss in compliance with the guidelines of IND AS 36 on "Impairment of Assets" as on31.03.2019. Total inventory valued ` 33.21 lakh (Previous Year ` 86.40 lakh) after provision of ` 4.55 lakh (PreviousYear ` 4.55 lakh) which remained as process material in the above Plant is included in the Inventory of the company.The management is of the opinion that such inventories consisting mainly of metal content and having realizablevalue at least equal to the amount at which they are stated.
6. The title deeds in respect of office flat at SCOPE Complex, Delhi & Jaipur office with total book value of ` 58.47 lakh(Previous year ` 62.88 lakh) are yet to be executed. Further, the title deeds for Freehold and Leasehold Land andBuilding acquired in respect of Gujarat Copper Project (GCP) with book value of 5859.97 lakh are yet to be executed(Previous year ` 6138.52 lakh).
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-179
108
a) ` 535.45 lakh
` 182.18 lakh
b) ` 0.36 lakh
c) ` 737.00 lakh
d) ` 919.18 lac
e)NIL
7. At ICC, Pollution Control Plant under Package I & III amounting to ` 2100.50 lakh have not been capitalized forwant of completion of trial / guarantee run as per terms of contract. As a matter of prudence, full provision for the samehas been made in the accounts to take care of efflux of time over the years.8. Confirmation letters of majority of balances under the heads Sundry Creditors, Claims Recoverable, Loans & Advances,Sundry Debtors and Deposits from and with various parties/ Government Departments have been sent but in number ofcases such confirmation letters from the parties are yet to be received.9. Like last year, considering the present scenario of MCP mines and to sustain the planned production, managementduring the year also decided to process the lean ore along with the normal ore produced from the mine. At the end of theyear, the value of closing lean ore was 2321.95 lakh (Previous Year ` 3013.44 lakh). The physical verification of lean orehas been conducted by the Malanjkhand Mining Department.10. During the year, the company has spent a sum of ` 208.16 lakh on account of Corporate Social Responsibility (CSR)expenses out of which ` 185.38 lakh is charged to Statement of Profit & Loss and the balance amount of ` 22.78 lakh hasbeen utilized out of unspent balance of CSR Fund.Amount spent during the year on:
Srl. No. Particulars in cash In cash Yet to be paid Total
(i) Construction/acquisition of any asset - - -(ii) On purposes other than (i) above ` 208.16 lakh - ` 208.16 lakh
11. Information related to Micro, Small and Medium Enterprises Development Act, 2006 is disclosed hereunder:
i) Principal amount remaining unpaid to any supplier at the end of the financial year
ii) Interest due on above
Amount of interest paid by the buyer in terms of Section 16of the Act, along with amount of payment made beyond theappointed date during the year
Amount of interest due and payable for the period of delay inmaking payment (which have been paid but beyond the duedate during the year) but without adding the interest specifiedunder the Act
Amount of interest accrued and remaining unpaid at the endof the financial year
Amount of further interest remaining due and payable even inthe succeeding years, until such date when the interest duesas above are actually paid to the Small enterprise, for thepurpose of disallowance as a deductible expenditure underSection 23 of the Act
The information has been given of such vendors to the extent they could be identified as "Micro and Small" enterpriseson the basis of information available to the Company.
12. Consequent to the decision of the Hon'ble Supreme Court vide its order dated 10.11.2016 in favour of the Company inrespect of appeal filed, a total amount of ` 12315.10 lakh is receivable from M.P. State Electricity Board (nowrenamed as MPVVNL) on account of excess charge of electricity bills paid in earlier periods. However, on conservativebasis, against such excess charge of electricity bills receivable, the Company has taken the balance credit of 2795.78lakh on the basis of adjustment against bills raised by MPVVNL during the year 2018-19.
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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13. During the year the Company has written back old liabilities / provisions amounting to ` 1095.29 lakh (PreviousYear ` 1376.96 lakh) in the accounts, the details of which are as under :-
Sl.No.
Particulars ` in lakh Reasons for reversal
Consequent to physical verificationconducted and on reconciliation with bookrecords during the year, the excessprovision at the end of the year has beenwritten back to revenue.
The relevant amount of debts and claimswere recovered from the customers/partiesand hence the provision for doubtful debts& claims created in earlier years has beenwritten back.
Sale of assets during the year for whichprovision already existed has been writtenback.
The excess provision for MP RuralInfrastructure & Road Development Taxhas been written back
Excess provision for interest on MSMEcreated in earlier years has been writtenback.
The excess provision for Water Bill hasbeen written back
The unclaimed liability for EMD, SD &Sundry Creditors unmoved for more than5 years has been written back
Excess provision for CSR created in earlieryears has been written back.
The excess liability created in earlier yearshas been written back.
1.
2.
3.
4.
5.
6.
7.
8.
9.
26.93
16.56
1.16
316.76
169.94
54.02
476.44
30.59
2.89
1095.29TOTAL
14. No fraud by the company or any fraud on the company by its officers and employees has been noticed or reportedduring the current financial year.
15. The Company has closed / suspended many of its mining operations located at various places, Fertilizer Plant atKhetri in different years due to their uneconomic operations. As per requirement of IND AS 105 on "Non-currentAssets Held for Sale and Discontinued Operations" the following information for the year are furnished:
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
Excess provision on account of shortage,non-moving, obsolete and insuranceStores & Spares written back in respectof MCP - ` 25.03 lakh & KCC - ` 1.90lakh
Excess provision for doubtful debts &claims no longer required is written backin TCP - 7.70 lakh, RSOW - 8.83 lakh& KCC - ` 0.03 lakh
Excess provision for discarded assets nolonger required is written back in KCC -` 0.63 lac, RSOW - ` 0.42 lakh & ICC -` 0.11 lakh
Excess provision created for MP RuralInfrastructure & Road Development Taxno longer required in MCP
Excess provision for interest on MSMEis written back in KCC - ` 70.67 lakh &MCP - ` 99.27 lakh
Excess provision created for Water Billis written back at MCP
Liability for unclaimed EMD, SD &Sundry Creditors for more than 5 yearswritten back at ICC - ` 262.82 lakh &HO - ` 213.62 lakh
Excess provision for CSR created inearlier years is written back in ICC -` 21.34 lakh & HO - ` 9.25 lakh
Excess liability created during the earlieryears in HO
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MSB RCP CCP DCP FertilizerGroup Plant
of Mines
i) Initial disclosure event (Year of closure) 1997 to 2003 2001 2002 1994 2001
ii) Carrying amount of Assets 503.89 - - (538.59) (-) (-)
iii) Liabilities to be settled 137.17 73.04 3.38(137.17) (73.04) (3.38)
iv) Amount of income - - - -(-) (-) (-) (-)
v) Amount of expenses - 34.70* - -(-) (34.70) (-) (-)
vi) Gain on sale of assets - - - -(Included in iv above) (-) (-) (-) (-)
* This is included in cash generated from operations in the Cash Flow Statement.
(` in lakh) (Previous year figures in brackets)
Pending fulfillment of conditions as set out in paragraphs 6 to 8 of IND AS 105 "Non-current Assets Held for Sale andDiscontinued Operations" the aforesaid assets held under disposal group and inadvertently shown as "Non-currentAssets Held for Sale" for the previous year has now been re-classified under Discarded Assets category and shown inNote No. 3B of the financial statements.
16. Since the company is primarily engaged in the business of manufacture and sale of copper products, the same isconsidered to be the only primary reportable business segment and accordingly has been reported. As the Companyoperates predominantly within the geographical limits of India, no secondary segment reporting has been consideredas per IND AS 108 "Operating Segments".
17. Sales for the period include FOB value of Export Sales:-
2018-19 2017-18Qty (MT) ` in lakh Qty (MT) ` in lakh
Anode Slime 19.800 2004.64 61.800 5524.15Copper Reverts 670.934 2027.10 - -Copper Concentrate (CMT) 19571.433 80235.59 7564.476 28544.79
Total 84267.33 34068.94
No separaterecords
maintainedNo separate
recordsmaintained
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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18. In terms of IND AS 24 on "Related Party Disclosures":The company does not have any Advances provided to its Subsidiary as at the year-end except as is disclosed below:
Transactions with Related Party
Name of Nature of Type of Year endedRelated Party Relationship Transaction 31.03.19 31.03.18
Chhattisgarh Subsidiary Investment 18.50 -Copper Limited in shares as on
Advances given 6.50 -as on
The remuneration of Key Management Personnel are given below:
Particulars Key Management Personnel Total Remuneration
FY 2018-19 FY 2017-18
FUNCTIONAL DIRECTORS
Receiving 1. Sri Santosh Sharma 66.45 41.08of Services Chairman-cum-Managing Director
2. Sri K D Diwan 21.11 48.50Chairman-cum-Managing Director
(Arrear Gratuity & PRP)
3. Sri Anupam Anand 59.01 48.07Director (Personnel)
4. Sri S K Bhattacharya 49.03 38.38Director (Mining)
5. Sri S K Bandyopadhyay 32.55 -Director (Finance) (w.e.f. 09.07.18)
6. Sri Arun Kumar Shukla 21.92 -Director (Operations) (w.e.f. 01.10.18)
7. Sri Subhendra Nanda - 2.76Director (Operations) (Arrear Salary & PRP)
8. Sri V V Venugopal Rao - 12.42Director (Finance)
9. Sri Avijit Ghosh - 10.47Director (Mining) (Terminal Benefits)
OTHER THAN FUNCTIONAL DIRECTORS
10. Sri C S Singhi 43.80 34.53Company Secretary
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
(` in lakh)
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INDEPENDENT DIRECTORS
Smt Simantini Jena - Date of appointment - 17.11.2015 & Re-appointed on 17.11.2018Sri Hemant Mehtani - Date of appointment - 17.11.2015 & Re-appointed on 17.11.2018Sri D R S Chaudhary - Date of appointment - 01.12.2015 & Re-appointed on 01.12.2018Sri Subhash Sharma - Date of appointment - 18.02.2018
Sl. No. Payment to Independent Directors FY 2018-19 FY 2017-18
1. Sitting Fees 10.35 3.60
Balance Outstanding with Key Managerial Personnel as on 31.03.2019
Sl. No. Particulars As on 31.03.2019 As on 31.03.20181. Amount payable Nil Nil2. Amount receivable Nil Nil
19. In terms of IND AS 33 on "Earning per Share" : (` in lakh)
BASIC DILUTED
Profit After Tax 14551.05 14551.05(7960.53) (7960.53)
Denominator used: Weighted average number of Equity 925218000 925218000Shares of ` 5/- (Previous year ` 5/- each) outstanding (925218000) (925218000)during the period.
Earning Per Share (` ) 1.573 1.573(0.861) (0.861)
20. The Company has accounted for Deferred Tax in accordance with the guidelines of IND AS 12 on "Income Taxes"issued by The Institute of Chartered Accountants of India. The Deferred tax balances are set out below:-
Deferred Tax Asset (Net)
Deferred Tax Asset :-
Difference between provision made in 8780.81 - 463.09 9243.90accounts and claims made as per I. T Act
8780.81 - 463.09 9243.90
Deferred Tax Liability :-
Difference between net book value of depreciable (3203.10) - 204.82 (2998.28)capital assets vis-a-vis WDV as per IT Act
Adjustment for fair value of Investment - - - -
(3203.10) - 204.82 (2998.28)
Deferred Tax Asset (Net) 5577.71 - 667.91 6245.62
Deferred TaxAsset/(Liability)as at 01.04.2018
Adjustment Credit/(Charge)during2018-19
Deferred TaxAsset/(Liability)as at 31.03.2019
(` in lakh)
Particulars
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
(` in lakh)
(` in lakh)
F-184
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21. PROVISIONS FOR CONTINGENCIES: -(` in lakh)
Particulars
Carrying amount as at 01.04.2018 743.11 3392.91 4664.86 17960.47 26761.35
Amount provided during the year 1096.26 695.58 - 7122.75 8914.59
Amounts utilized against provision 0.81 - - 8682.38 8683.19
Unused amounts released during the year. - - - - -
Carrying amount as at 31.03.2019 1838.56 4088.49 4664.86 16400.84 26992.75
DiscardedFixed Assets
CapitalWIP &
Advance
MineDevelopmentExpenditure
TOTALOthers
22. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS IN TERMS OF Ind AS 19 :
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service getsa gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is fundedthrough Life Insurance Corporation of India, SBI Life Insurance Co. Ltd. and India First Life Insurance and are managedby separate trust. During the year, the Company has also funded through Life Insurance Corporation of India and SBILife Insurance Co. Ltd towards leave encashment. Expenses recognized in Statement of Profit & Loss, Other ComprehensiveIncome and Mine Development Expenditure amounting to ` 4732.36 lakh in respect of Gratuity, Leave Encashment andLeave Travel Concession which have been provided for as stated below.
The following tables summarize the components of net benefit expense recognized in the Statement of Profit and Loss,Other Comprehensive Income and Mine Development Expenditure and the funded status and amounts recognized in thebalance sheet for the respective plans.
Gratuity Leave Leave Travel(Funded plan) Encashment Concession
(Partially (Non-fundedfunded Plan) Plan)
(i) Changes in Present Value of ObligationPresent Value of obligation as on last valuation 16287.25 12671.78 139.11Current service cost 826.82 995.51 -Interest cost 960.87 820.94 -Total Actuarial gain/loss 1676.21 1265.18 127.25Benefits Paid 6249.25 2852.24 94.43Present value of obligation as on valuation date 13501.90 12901.17 171.93
(ii) Changes in Fair Value of Plan AssetsFair value of Plan Assets at Beginning of period 23543.84 2911.19Interest Income 1716.93 223.48Employer Contributions 2800.00 3051.84Benefits paid 6249.25 2852.24Return on Plan Assets excluding Interest Income - -Fair value of Plan Assets at End of measurement period 21811.52 3334.27
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-185
114
Gratuity Leave Leave Travel(Funded plan) Encashment Concession
(Partially (Non-fundedfunded Plan) Plan)
(iii) Table Showing Reconciliation to Balance SheetFunded Status 8309.62 (9566.90)Fund Asset 21811.52 3334.27Fund Liability 13501.90 12901.17
(iv) Expenses recognized in the Statement of Profit and Loss AccountCurrent service cost 826.82 995.51Net Interest cost (756.06) 597.45Actuarial (gain)/loss - 1265.18 127.25Benefit Cost (Expense Recognized in Statement of Profit & Loss) 70.76 2858.14 127.25
(v) Other Comprehensive IncomeTotal Actuarial (gain)/loss 1676.21 -Return on Plan Asset, Excluding Interest Income - -Balance at the end of the Period 1676.21 -Net(Income)/Expense for the Period Recognized in OCI 1676.21 -
(vi) Table Showing Plan AssumptionsDiscount Rate 7.30% p.a. 7.30% p.a. 7.30% p.a.Expected Return on Plan Asset 8.00%,7.50%,7.27% 8.00%, 7.50% -Rate of Compensation Increase (Salary Inflation) 6.00% p.a. 6.00% p.a. -Average expected future service (Remaining working Life) 8 years 8 years 8 yearsMortality Table IALM 2006-2008 IALM 2006-2008 IALM 2006-2008
ULTIMATE ULTIMATE ULTIMATESuperannuation at age-Male 60 years 60 years 60 yearsSuperannuation at age-Female 60 years 60 years 60 yearsEarly Retirement & Disablement (All Causes Combined) 1% p.a. 1% p.a. 1% p.a.
The details of the plan assets as on 31.03.2019 towards gratuity & leave encashment are as follows:
Investment in Life Insurance Corporation of India 2580.64Investment in SBI Life Insurance Co. Ltd 20448.28Investment in India First Life Insurance 700.31Fund with Gratuity Trust Savings Bank Accounts 1416.56
Total 25145.79
(` in lakh)
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-186
115
Actual Return on Plan Assets during the year - ` 1940.41 lakh.
The estimates of future salary increases were considered in actuarial valuation after taking into account inflation, seniority,promotion and other relevant factors. Further, the expected return on plan assets is determined considering several applicablefactors mainly the composition of plan assets held, assessed risk of asset management and historical returns from plan assets.
23. The physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in allthe units at the end of the current year by a duly approved committee. Also, physical stock verification of WIP andFinished Goods is undertaken by an independent agency in all the units at the end of the financial year. In respect ofstores and spares, physical verification has been conducted by the external agencies once during the year. Shortages/(Excesses) identified on such physical verification have been duly adjusted in the books of accounts.
24. The physical verification of fixed assets which is required to be conducted every year so that all the units/offices arecovered once in a block of three years interval. Physical verification of fixed assets has been conducted by externalagencies in ICC, RCP, MCP, GCP, Bangalore Sales Office & H.O. during FY 2016-17, in KCC & Delhi Sales Office in2017-18 and TCP & Mumbai Sales Office during the year. Shortages/(Excesses) identified on such physical verificationhave been duly adjusted in the books of accounts.
25. As per Ind As requirement, Mine Closure Expenditure is assessed to provide reliable and more relevant information.Accordingly Accounting Policy No. 2.13 has been modified and consequently profit of the Company is reduced by` 163.00 lakh which includes past as well as current period expenses. However, the other changes in Significant AccountingPolicies relating to Property, Plant & Equipment, Intangible Assets, Inventory etc are made to provide reliable and morerelevant information without any financial impact on the accounts of the company.
26. Financial Instrument
1. Derivatives not designated as hedging instruments
The Company uses Commodity Futures Contracts to manage its commodity price risk . The Commodity Futures Contractsare not designated as hedging instruments and are entered into for periods consistent with commodity price risk exposureof the underlying transactions, generally from one to four months.
The Company uses foreign exchange forward contracts to manage some of its transaction exposures. The foreign exchangeforward contracts are not designated as cash flow hedges and are entered into for periods consistent with foreign currencyexposure of the underlying transactions, generally from one to four months.
Commodity price riskThe Company purchases copper blister/ anode on an ongoing basis for its operating activities in its Gujarat CopperProject plant for the production of cathode. To hedge itself against the volatility in LME copper prices in the internationalmarket has led to the decision to enter into commodity future contracts.
These contracts, which commenced in August 2016, are expected to reduce the volatility attributable to price fluctuationsof copper. Hedging the price volatility of copper purchases is in accordance with the Rsk Management Policy approved bythe Board of Directors. The hedging relationships are for a period between 1 and 4 months based on existing purchaseagreements. The Company designated only the spot-to-spot movement of the entire commodity purchase price as thehedged risk. It has been decided by the company not to follow the hedge accounting for these instruments.
As at 31 March 2019, the fair value of the open position of commodity future contracts is nil.
2 . Financial Instruments by Categories.
The carrying value and fair value of financial instruments by categories were as follows:
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-187
116
Particulars
Financial Assets at FV throughStatement of Profit & LossMutual Funds 7.84 7.84 8.85 8.18Derivatives not designated as hedgesFuture Contract Receivable on commodity - - - -Total of Financial Assets 7.84 7.84 8.85 8.18Financial LiabilitiesDerivatives not designated as hedgesForward Cover Contract Liability - - - -Total of Financial Liabilities - - - -
Total carryingvalue as at
March 31, 2019
Total carryingvalue as at
March 31, 2018
Fair Valueas at
March 31, 2019
Fair Valueas at
March 31, 2018
3. The Management considers the Service fees of ` 15 lakh paid on the Exim Bank Term loan amounting to` 30000 lakh drawn on 29.05.2018 as immaterial, as the amount of service fee was only 0.009% of the Turnover (FY2018-19) of the company and hence the same was not considered as a transaction cost in terms of fair valuation atinitial recognition under INDAS 109. Further, the Management assessed that for the purpose of IND AS 109, thecarrying value of loan is considered as its fair value as no loan could be provided at a rate lower than the rate ofinterest of Exim Bank loan for similar terms and conditions of the loan at that point of time.
Similarly, the Management considers the total of Upfront fees & Other charges of ` 245.33 lakh paid on the SBIECB loan amounting to ` 17734.75 lakh drawn during July 2018 to January 2019 as immaterial, as the amount ofsuch fees/charges was only 0.140% of the Turnover (FY 2018-19) of the company and hence the same was notconsidered as a transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further, theManagement assessed that for the purpose of IND AS 109, the carrying value of loan is considered as its fair valueas no loan could be provided at a rate lower than the rate of interest of SBI ECB loan for similar terms and conditionsof the loan at that point of time.
The Management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts andother current liabilities approximate their carrying amounts largely due to the short-term maturities of theseinstruments.
The fair value of the financial assets and liabilities is included at the amount at which the instrument could beexchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The followingmethods and assumptions were used to estimate the fair values:
The Company enters into derivative financial instruments with various counterparties, principally with financialinstitutions having Investment grade credit ratings. Foreign exchange forward contracts and commodity futurecontracts are valued using valuation techniques, which employs the use of market observable inputs. The mostfrequently applied valuation techniques include forward pricing .
4. Fair Value Hierarchy
� Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) in activemarkets.
� Level 2 - Level 2 hierarchy includes financial instruments measured using inputs other than quoted pricesincluded within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly(i.e. derived from prices).
� Level 3 - Level 3 hierarchy includes financial instruments measured using inputs that are not based on observablemarket data (unobservable inputs).
Set out below, is a comparison by class of the carrying amounts and fair value of the Company’s financial instruments, otherthan those with carrying amounts that are reasonable approximations of fair values:
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-188
117
Particulars Date of Valuation Level 1 Level 2 Level 3 Total
Financial Assets at FV throughStatement of Profit & Loss
Non-derivative financial assets
Mutual funds 31/Mar/2019 8.85 - - 8.85
Derivative financial assets
Future Contract Receivable on commodity 31/Mar/2019 - - - -
Liabilities measured at fair value:
Derivative financial liabilities
Forward Cover Contract Liability 31/Mar/2019 - - - -
Assets measured at FV through OCI 31/Mar/2019 - - - -
5. Financial Risk Management
Financial risk factors
The Company's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company'sprimary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on itsfinancial performance.
(Amount in ` lakh)
Particulars Date of Valuation Level 1 Level 2 Level 3 Total
Financial Assets at FV throughStatement of Profit & Loss
Non-derivative financial assets
Mutual funds 31/Mar/2018 8.18 - - 8.18
Derivative financial assets
Future Contract Receivable on commodity 31/Mar/2018 - - - -
Liabilities measured at fair value: Derivativefinancial liabilities
Forward Cover Contract Liability 31/Mar/2018 - - - -
Assets measured at FV through OCI 31/Mar/2018 - - - -
Risk Exposure arising from Measurement Management
Market risk- Future commercial Sensitivity analysis Forward foreign exchangeForeign Exchange transactions, Recognised contracts
financial assets andfinancial liabilities
Market-Commodity Price Risk Purchase of Copper Price Sensitivity Commodity Futures Contract
Credit risk Trade receivables Ageing analysis Sales are mainly doneagainst Advance or
Letters of CreditLiquidity risk Borrowings and other Rolling cash flow forecasts Cash flow management
liabilities
(Amount in ` lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
The following table presents fair value hierarchy of assets and liabilities measured at fair value
F-189
118
a) Market Risk
i) Foreign Currency Risk
The Company operates at international level which exposes the company to foreign currency risk arising from foriegncurrency transaction primarily from Imports and foreign currency borrowing. Foreign currency risk arises from futurecommercial transactions and recognised assets and liabilities denominated in a currency other than INR as on reportingdate.
Particulars ` in lakh
Cash & cash equivalents -
Trade Payables -
Loans 68007.12
Others (if any) -
Net Assets/ (-) Liabilities (-) 68007.12
Particulars ` In lakh
Cash & cash equivalents -
Trade Payables -
Loans 56214.52
Others (if any) -
Net Assets/ (-) Liabilities (-) 56214.52
(As of March 31, 2019 )
(As of March 31,2018 )
Sensitivity
The sensitivity of profit or loss to changes in exchange rate arises mainly from foreign currency denominated financial instrument.
Particulars Impact on profit before tax
March 31, 2019 March 31, 2018
Increase by 5% (3400.36) (2810.73)
Decrease by 5 % 3400.36 2810.73
ii) Commodity Price Risk
The company's exposure to security price from copper price fluctuation in international market does not arise as thecompany hedges all its imports through Future contracts at LME.
b) Credit Risk
Credit risk refers to the risk of default on its obligation by the Debtors resulting in a financial loss. The company sellsmajority of its products either against Advance from Customers or Letters of Credit. Accordingly, credit risk from Tradereceivables has not been cosidered as credit risk.
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-190
119
Credit risk exposure
An analysis of age of Trade receivables at each reporting date is summarized as follows:
Particulars 31-Mar-19 31-Mar-18
Gross Gross
Not past due - -
Past due more than three months but not more than six months 29162.70 6452.99
Past due more than six months but not more than one year 2247.62 471.03
More than one year 5687.28 2169.23
Total 37097.60 9093.25
Less Allowances for Bad & Doubtful Debts 942.77 935.89
Net Debtors 36154.83 8157.36
(Amount in ` lakh)
Customer credit risk is managed by each business unit subject to the Company's established Marketing policy, proceduresand control relating to customer credit risk management. Outstanding customer receivables are regularly monitored andany shipments to major customers are generally covered by letters of credit or other forms of credit insurance.
The maximum exposure to credit risk at the reporting date is ` 942.77 lakh for which full provision has been made in theaccounts as disclosed in Note No 12.
Other financial assets
Credit risk relating to cash and cash equivalents is considered negligible because our counterparties are scheduledbanks. We consider the credit quality of Term deposits with such banks as good as these banks are under the regulartoryframework of Reserve Bank of India. We review these banking relationships on an ongoing basis.
c) Liquidity Risk
Our liquidity needs are monitored on the basis of monthly and yearly projections. The company's principal sources ofliquidity are cash and cash equivalents, cash generated from operations.
We manage our liquidity needs by continuously monitoring cash inflows and by maintaining adequate cash and cashequivalents. Net cash requirements are compared to available cash in order to determine any shortfall.
Short term liquidity requirements consists mainly of Sundry creditors, Expense payable, Employee dues arising duringthe normal course of business as of each reporting date. We maintain a sufficient balance in cash and cash equivalents tomeet our short term liquidity requirements.
The table below provides details regarding the contractual maturities of financial liabilities. The table has been drawnup based on the undisclosed cash flows of financial liabilities based on the earliest date on which the company can berequired to pay.
(Amount in ` lakh as of March 31, 2019)
Particulars On Demand Less than 3 months 1-3 years 3-5 years 5-7 years Total 3 months to 1 year
Short term borrowings (cash credit) 16503.81 - - - - - 16503.81
Short term borrowings (Others) - 22702.84 - - - - 22702.84
Long Term Borrowings - 756.51 9982.04 32467.53 23147.58 1450.62 67804.28
Forex forward Contract - - - - - - -
Total 16503.81 23459.35 9982.04 32467.53 23147.58 1450.62 107010.93
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-191
120
Short term borrowings (cash credit) 9480.56 - - - - - 9480.56
Short term borrowings (Others) - 40923.98 - - - - 40923.98
Long Term Borrowings - - 5082.27 10208.27 - - 15290.54
Forex forward Contract - - - - - - -
Total 9480.56 40923.98 5082.27 10208.27 - - 65695.08
Particulars On Demand Less than 3 months 1-3 years 3-5 years 5-7 years Total 3 months to 1 year
(Amount in ` lakh as of March 31, 2018)
6. Capital Management
For the purpose of the Company's capital management, capital includes issued equity capital and all other equity reservesattributable to the Company. The primary objective of the Company's capital management is to maximise the shareholdervalue.
27. INFORMATION IN RESPECT OF SUBSIDIARIES (FORM AOC 1)(Pursuant to Section 129(3) of Companies Act 2013 read with Rule 5 of Companies (Accounts) Rules, 2014)
Sl. No. Particulars1 Name of the subsidiary Chhattisgarh Copper Limited2 Reporting period for the subsidiary concerned, if different from
the holding company's reporting period NA3 Reporting currency INR4 Equity Share Capital ` 25,00,0005 Other equity ` (24,79,827)6 Total assets ` 11,22,7807 Total liabilities ` 11,02,6078 Investments Nil9 Total Income from operations (net) Nil
10 Profit/(Loss) from ordinary activities before tax ` (24,79,827)11 Tax expense Nil12 Profit/(Loss) from ordinary activities after tax ` (24,79,827)13 Proposed Dividend Nil14 % of shareholding 74%
Note :
1. Chhattisgarh Copper Limited is yet to commence operations.
2. The subsidiary has neither been liquidated nor sold during the year.
Pursuant to Section 186(4) of the Companies Act, 2013, details of investment made on subsidiary and advance given to subsidiaryhas been shown under Note No. 5 & 16 respectively. However no loan has been given to the subsidiary during the year.
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-192
121
Year ended Year ended 31.03.2019 31.03.2018
Profit / (Loss) before Tax 23034.64 12203.54Income Tax expense calculated at 34.944% (34.608%) 8049.22 4223.40Effect of Deferred Tax balances due to the change in income tax rates (60.05) -Income Tax effect of earlier years 472.18 -Others (net) (0.33) (3.08)Income Tax expense recognized in profit or loss 8461.02 4220.32
29. The value of assets, other than fixed assets and non-current assets, have realizable value at least equal to the amountat which they are stated.
30. Gujarat Copper Project of the Company consists of three units namely, Anode Furnace (Smelter), Refinery and KaldoFurnace valuing 27214.50 lakh as at March 31,2019. The Anode Furnace and Refinery unit has been commissionedin October 2016 while Kaldo unit is yet to be commissioned. Since commissioning, the Anode Furnace and Refineryunits are being operated at a sub optimal level for want of feed stock. GCP being a secondary smelter, the feed stockare copper scrap, copper blister, liberator cathode etc. The Company has not been able to source these materials inthe required quantity resulting in suboptimal operations.The profit margin of GCP will essentially come from the operation of Kaldo furnace which has the ability to processall types of secondary copper material including scrap. The second phase of refurbishment at GCP includes Kaldofurnace, converter, slag granulation, ETP, etc. which is completed during the current FY 2018-19 and test run hasalso being successfully completed with the low quality raw material copper content as low as 30% copper which isgenerated internally in other units.Management is trying to make the project viable and exploring to source the scrap materials directly from the worldmarket. It is expected that scrap materials will be available during the FY 2019-20 to perform at the desired level.
31. The previous year's figures and comparative are not applicable, being first reporting period of consolidated financialstatements.
28. The income tax expense for the year can be reconciled to the accounting profit as follows :
Particulars
(` in lakh)
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-193
122
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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F-194
123
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
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F-195
124
Year ended Year ended Year ended Year ended2018-2019 2017-2018 2018-2019 2017-2018
CMT CMT ( ` in Lakh) (`(`(`(`(` in Lakh)
Concentrate own production 14549 15564 33438.35 31786.20Concentrate excluding own production - - - -Cathode - - - -
38.3 Imported and indigenous raw materials, storesspare parts and components consumed( as certified by the management )
RAW MATERIALS: % %Imported 92 95 5741.43 38950.22Indigenous 8 5 528.14 2155.34
100.00 100.00 6269.57 41105.56
STORES & SPARES:(Direct and Stores & Sparesbooked in Mine Development,Shut-down and Fuel)
Imported 4.14 0.27 882.50 59.93Indigenous 95.86 99.73 20448.64 22179.54
100.00 100.00 21331.14 22239.47
38.4 C.I.F. value of importsRaw Material 5741.43 33578.95Components, spare parts 1444.00 210.08and stores
7185.43 33789.03
38.5 Expenditure in foreign currencyTravelling 85.64 41.94Others 7185.52 33789.03
7271.16 33830.97
38.6 Earning in foreign ExchangeExport of Goods (FOB) 84267.33 34068.94
84267.33 34068.94
38.7 Payment to Whole Time Directors Salaries and allowances 186.11 123.20Company's contribution to provident and other funds 13.99 10.70Re-imbursement of Medical expenses 0.53 0.86Leave Encashment 13.23 24.09Gratuity 10.00 14.42Other Benefits 26.21 28.41
250.07 201.68
Note :
In addition, the Whole Time Directors are allowed the use of company car for private purpose and have beenprovided with residential accomodation as per terms of their appointment/Government guidelines
38. GENERAL NOTES ON ACCOUNTS (Contd.)Additional information forming part of accounts for year ended March 31, 2019
38.2 Raw materials consumedValueQuantity
NOTES TO THE STANDALONE FINANCIAL STATEMENTS (Contd.)
F-196
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INDEPENDENT AUDITOR’S REPORT
ToThe Members ofHindustan Copper Limited
Report on the Audit of the Consolidated Financial Statements
Opinion
We have audited the accompanying consolidated financial statements of Hindustan Copper Limited (“the HoldingCompany”) and its one subsidiary company(Holding company and its subsidiary company together hereinafter referredto as “the Group”), which comprise the Consolidated Balance Sheet as at March 31, 2019 and the Consolidated Statementof Profit and Loss (including Other Comprehensive Income), the Consolidated Statement of Changes in Equity and theConsolidated Cash Flow Statement for the year ended on that date, and notes to the Consolidated Financial Statementsincluding a summary of the significant accounting policies and other explanatory information (hereinafter referred to as“the Consolidated Financial Statements”).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidatedfinancial statements give the information required by the Companies Act, 2013 in the manner so required and give atrue and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act readwith the Companies (Indian Accounting Standards) Rules, 2015, as amended, ("Ind AS") and other accounting principlesgenerally accepted in India, of the consolidated state of affairs of the Group as at March 31, 2019, and itsconsolidatedprofit (including Other Comprehensive Income), consolidated changes in equity and its consolidated cash flows for theyear ended on that date.
Basis for Opinion
We conducted our audit of the consolidated financial statements in accordance with the Standards on Auditing (SAs)specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report.We are independent of the Group in accordance with the Code of Ethics issued by the Institute of Chartered Accountantsof India (ICAI) together with the ethical requirements that are relevant to our audit of the consolidated financial statementsunder the provisions of the Companies Act, 2013 and the Rules made thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence obtainedby us and the audit evidence obtained by other auditors in terms of their report referred to in “Other Matters” Paragraphbelow, are sufficient and appropriate to provide a basis for our audit opinion on the consolidated financial statements.
Emphasis of Matters
We draw attention to the following matters:
a) Note No.38 Para 1,"Contingent liabilities" of the accompanying standalone financial statements which describes theuncertainty related to the outcome of the lawsuits filed and demand raised against the company by various partiesand Government authorities;
b) Note No.38 Para 4 & 6 of the accompanying consolidated financial statements which states that title deeds forleasehold and freehold lands or other evidences of title are pending to be reconciled with financial records. As per theGroup's management, the title deeds, conveyance deeds etc. in respect of certain freehold lands at Indian CopperComplex acquired through nationalization in accordance with Indian Copper Corporation (Acquisition of Undertaking)Act, 1972 are not in possession of the Group and title deeds in some locations at Gujarat Copper Project, Delhi andJaipur office are yet to be executed in favor of the Group.
c) Note No.38 Para 8 of the accompanying consolidated financial statements wherein,balances under the head ClaimsRecoverable, Loans & Advances, Sundry Debtors, Deposits with various parties and certain balances of Sundrycreditors and other current liabilities have not been confirmed as at March 31, 2019.Consequential impact uponreceipt of such confirmation/reconciliation/adjustment of such balances, if any is not ascertainable at this stage;
d) We refer Note No. 38 Para 32 of the accompanying consolidated financial statements regarding Gujarat Copperproject valuing 27214.50 lakh where the company has not been able to operate profitably due to various constraint,viability assessment needs to be done to evaluate and adjust for possible impairment loss, if any.
Our opinion is not modified in respect of these matters.
F-197
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Assessment of Stripping Ratio and charging ofoverburden expenditure during productionstage of surface mines to Mines DevelopmentExpenditure and Profit and Loss account
Referred in Note No.2 (11) and Note No.9 of theconsolidated financial statements.Assessment of Stripping Ratio is technicallyestimated initially at the beginning of the Mines andlater on periodically assessed for which no standardswritten policy are there. Normally review donewithin a period of 3 to 4 years as informed to us.In case of Open cast mines, the expenditure onremoval of waste and overburden, is capitalized andthe same is depleted in relation to actual oreproduction during the year on the stripping ratiowhich is re-assessed periodically based on theestimated ore reserve as well as the quantity of wasteexcavation in respect of open cast mines.Assessment of Stripping ratio is uniquely appliedunder the Mining industries which involvessignificant judgment to determine the ratio and thatalso keep on change from time to time. This ratiohas been changed subsequently based on the actualoutput of overburden and Ore exposed during theproduction stage of the mines.We have identified this area as key audit matterdue to its nature as industry specific andinvolvement of technical assumptions andjudgments in calculation of stripping ratio. Furtherit has a material impact on the consolidated financialstatements being this year company has amortized` 20074.56. lakh (PY: - ` 11970.45 lakh) as Minedevelopment expenditure for open cast mines.Impact of Change in Accounting PolicyDuring the year the Group has changed itsaccounting policy in respect of provision for Minesclosure expenditure as per the regulatoryrequirements. Refer Note No.38 (25) of theconsolidated financial statements.We have considered this as Key Audit Matter as non-implementation of the change in accounting policyin the system may have significant impact on thefinancial statements.
Key Audit Matters Auditor’s ResponseSl.No.
1
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of theconsolidated financial statements of the current period. These matters were addressed in the context of our audit of theconsolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separateopinion on these matters. We have determined the matters described below to be the key audit matters to be communicatedin our report.
Principal Audit ProceduresOur audit approach consisted testing of the designand operating effectiveness of the internal controlsand substantive testing as follows:� We went through the current status of the mining
at different mines
� We discussed with the management about thestripping procedure adopted in the industry as wellpractice followed by the company
� Procedure followed by the management towardsIdentification of expenditures incurred in surfacemines during production stage
� Understanding the computation of Stripping ratioinitially made and documents made available tous.
� We have checked the stripping ratio to be chargedunder amortization for mine developmentexpenditure for balance period of mines
� Discussion with the core technical team involve inthis process
� Reliance is placed on the representations of themanagement.
Principal Audit Procedures� We have discussed the change in accounting policy
with the management and� Verify the implementation of the change in the
books of accounts.
2
INDEPENDENT AUDITOR’S REPORT (Contd.)
F-198
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Information Other than the Consolidated Financial Statements and Auditor's Report Thereon
The Company's Board of Directors is responsible for the other information. The other information comprises the informationincluded in the Report of the Board of Directors, Management Discussion and Analysis Report, Report on CSR activities,Business Responsibility Report, Corporate Governance Report and other annexure to Directors Report includingShareholder's Information, but does not include the consolidated financial statements and our auditor's report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express anyform of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other informationand, in doing so, consider whether the other information is materially inconsistent with the consolidated financialstatements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information; weare required to report that fact. We have nothing to report in this regard.
Responsibility of Management and Those Charged with Governance for the Consolidated FinancialStatements
The Holding Company's Board of Directors is responsible for the matters stated in section 134(5) of the CompaniesAct, 2013 ("The Act") with respect to the preparation of these consolidated financial statements that give a true andfair view of the consolidated financial position, consolidated financial performance, changes in equity and consolidatedcash flows of the Group in accordance with the accounting principles generally accepted in India, including theaccounting Standards specified under Section 133 of the Act. The respective Board of Directors of the companies includedin the Group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the Group and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; anddesign, implementation and maintenance of adequate internal financial controls, that were operating effectively forensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of theconsolidated financial statements that give a true and fair view and are free from material misstatement, whether dueto fraud or error, which have been used for the purpose of the preparation of the consolidated financial statements by theDirectors of the Holding company ,as aforesaid..
In preparing the consolidated financial statements, the respective Board of Directors of the companies included in theGroup are responsible for assessing the ability of the Group to continue as a going concern, disclosing, as applicable,matters related to going concern and using the going concern basis of accounting unless the Board of Directors eitherintends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
The respective Board of Directors of the companies included in the Group is also responsible for overseeing the financialreporting process of the Group.
Auditor's Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole arefree from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAswill always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions ofusers taken on the basis of these consolidated financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticismthroughout the audit. We also:
� Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraudor error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficientand appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.
� Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriatein the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whetherthe Company has adequate internal financial controls system in place and the operating effectiveness of such controls.
INDEPENDENT AUDITOR’S REPORT (Contd.)
F-199
128
INDEPENDENT AUDITOR’S REPORT (Contd.)
� Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and relateddisclosures made by management.
� Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the auditevidence obtained, whether a material uncertainty exists related to events or conditions that may cast significantdoubt on the ability of the Group to continue as a going concern. If we conclude that a material uncertainty exists, weare required to draw attention in our auditor's report to the related disclosures in the consolidated financial statementsor, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtainedup to the date of our auditor's report. However, future events or conditions may cause the Group to cease to continueas a going concern.
� Evaluate the overall presentation, structure and content of the consolidated financial statements, including thedisclosures, and whether the consolidated financial statements represent the underlying transactions and events in amanner that achieves fair presentation.
� Obtain sufficient appropriate audit evidence regarding the financial information of the companies within the Group toexpress an opinion on the consolidated financial statements. We are responsible for the direction, supervision andperformance of the audit of the financial statements of the companies included in the consolidated financial statementsof which we are the Independent auditors. For the other companies included in the consolidated financial statements,which have been audited by the other auditors, such other auditors remain responsible for the direction, supervisionand performance of the audits carried out by them. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing ofthe audit and significant audit findings, including any significant deficiencies in internal control that we identify duringour audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirementsregarding independence, and to communicate with them all relationships and other matters that may reasonably bethought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of mostsignificance in the audit of the consolidated financial statements of the current period and are therefore the key auditmatters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about thematter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our reportbecause the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits ofsuch communication.
Other Matters
We did not audit the financial statements of one subsidiary company included in the consolidated quarterly financialresults and consolidated year to date financial results, whose financial statements reflect total assets of ` 11.23 lakh asat 31st March 2019 and cash inflows of ` 5.11 lakh for the year ended on that date as considered in the consolidatedfinancial statements of the Holding company. These financial statements and other financial information have beenaudited by other auditors whose reports have been furnished to us by the Holding company's management, and ouropinion on the consolidated financial statements, so far as it related to the amounts and disclosures included in respectof this subsidiary company and our report in terms of sub-section (3) of Section 143 of the Act, in so far as it relates to thesubsidiary company, is based solely on the reports of other auditors. Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements
1) The Companies (Auditor's Report) Order, 2016 ("the Order"), issued by the Central Government of India in terms ofsub-section (11) of section 143 of the Companies Act, 2013 is not applicable to the consolidated financial statementsas referred in Proviso to Para 2 of the said Order.
2) As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and beliefwere necessary for the purposes of our audit of the aforesaid consolidated financial statements except as reportedin Clause (b) & (c) of the "Emphasis of Matters" paragraph above;
b) In our opinion, proper books of account as required by law relating to the preparation of the aforesaid consolidatedfinancial statements have been kept so far as it appears from our examination of those books and reports of theother auditors.
F-200
129
For Chaturvedi & Co.Chartered Accountants
(Firm's Registration No.302137E)
CA S.C.ChaturvediPartner
(Membership No. 012705)
Place: New Delhi
Date: May 28, 2019
c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss including Other ComprehensiveIncome, Consolidated Statement of Changes in Equity and the Consolidated Cash Flow Statement dealt with bythis Report are in agreement with the relevant books of account maintained for the purpose of preparation of theconsolidated financial statements.
d) In our opinion, the aforesaid consolidated financial statements comply with the Ind AS specified underSection 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.
e) In pursuance to the Notification No. G.S.R 463(E) dated 05-06-2015 issued by the Ministry of Corporate affairs,Section 164(2) of the Companies Act, 2013 pertaining to disqualification of Directors, is not applicable to theGovernment Companies.
f) With respect to the adequacy of the internal financial controls over financial reporting of the Group and theoperating effectiveness of such controls, refer to our separate Report in "Annexure-A";
g) With respect to the other matters to be included in the Auditors' Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according tothe explanations given to us:
i. The consolidated financial statements disclose the impact of pending litigations on its consolidated financialposition of the Group.-[Refer Note No.38 (1) to the accompanying consolidated financial statements];
ii. The Group did not have any long-term contracts including derivative contracts for which there were anymaterial foreseeable losses;
iii. There were no amounts which were required to be transferred to the Investor Education and ProtectionFund by the Holding company and its subsidiary company.
3) As required by Section 143(5) of the Act, we give in the "Annexure-B", a statement on the matters specified in theDirections issued by the Comptroller and Auditor General of India in respect of the Holding company. This statementhas been prepared incorporating the comments of the Auditors' of the subsidiary company mentioned in their reports.
INDEPENDENT AUDITOR’S REPORT (Contd.)
F-201
130
Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 ofSection 143 of the Companies Act, 2013 (“the Act”)
In conjunction with our audit of the consolidated financial statements of the Group as of and for the year ended March 31,2019, we have audited the internal financial controls over financial reporting of Hindustan Copper Limited (hereinafterreferred as “the Holding company”) as of March 31, 2019 and considered the report of auditor of the subsidiarycompany as of that date.
Management's Responsibility for Internal Financial Controls
The respective Board of Directors of the Holding company and subsidiary company are responsible for establishing andmaintaining internal financial controls based on the internal control over financial reporting criteria established by theGroup considering the essential components of internal control stated in the Guidance Note on Audit of Internal FinancialControls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilitiesinclude the design, implementation and maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the orderly and efficient conduct of its business, including adherence to respective company's policies, thesafeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of theaccounting records, and the timely preparation of reliable financial information, as required under the Companies Act,2013.
Auditor's Responsibility
Our responsibility is to express an opinion on the internal financial controls over financial reporting of the Group basedon our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting (the "Guidance Note") issued by the Institute of Chartered Accountants of India and the Standardson Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internalfinancial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financialreporting was established and maintained and if such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controlssystem over financial reporting and their operating effectiveness. Our audit of internal financial controls over financialreporting included obtaining an understanding of internal financial controls over financial reporting, assessing the riskthat a material weakness exists, and testing and evaluating the design and operating effectiveness of internal controlbased on the assessed risk. The procedures selected depend on the auditor's judgment, including the assessment of therisks of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained and audit evidence obtain by the Other auditors in terms of theirreports referred to in the "Other Matters" paragraph below, is sufficient and appropriate to provide a basis for our auditopinion on the Group's internal financial controls system over financial reporting.
Meaning of Internal Financial Controls Over Financial Reporting
A company's internal financial control over financial reporting is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of financial statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financial control over financial reportingincludes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accuratelyand fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements in accordance with generally acceptedaccounting principles, and that receipts and expenditures of the company are being made only in accordance withauthorizations of management and directors of the company; and (3) provide reasonable assurance regarding preventionor timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a materialeffect on the financial statements.
Inherent Limitations of Internal Financial Controls over Financial Reporting
Because of the inherent limitations of internal financial controls over financial reporting, including the possibility ofcollusion or improper management override of controls, material misstatements due to error or fraud may occur and notbe detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periodsare subject to the risk that the internal financial control over financial reporting may become inadequate because ofchanges in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
ANNEXURE - A TO THE INDEPENDENT AUDITOR'S REPORT
F-202
131
ANNEXURE - A TO THE INDEPENDENT AUDITOR'S REPORT (Contd.)
Opinion
In our opinion, to the best of our information and according to the explanations given to us, the Group has, in all materialrespects, an adequate internal financial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at March 31, 2019, based on the internal control over financialreporting criteria established by the Group considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountantsof India. However at Holding company, certain areas need further improvement in designing the "Documentation onInternal Financial Controls" of the Holding company by way of improving the fixed assets accounting, cash and bankmanagement, payable management, receivable management, inventory management, elaborating the process flow bywhich the transactions are initiated, authorized, processed, recorded, and reported at department level. System integrationto capture the transactions that relates to financial statements and events/conditions and other transactions significantto the financial statements has to be designed properly so as to fulfill the objectives of control criteria established by theHolding company. Further modification of finance/accounts manual needs to be done incorporating the Indian AccountingStandard requirements to have effective internal control over financial reporting.
However, our opinion is not qualified in the above respect.
Other Matters
Our aforesaid report under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internalfinancial controls over financial reporting, is so far as it relates to the one subsidiary company, is based on the correspondingreport of the auditors of such company, a company incorporated in India.
For Chaturvedi & Co.Chartered Accountants
(Firm's Registration No.302137E)
CA S.C.ChaturvediPartner
(Membership No. 012705)
Place: New Delhi
Date: May 28, 2019
F-203
132
For Chaturvedi & Co.
Chartered Accountants
(Firm's Registration No.302137E)
CA S.C. Chaturvedi
Partner
(Membership No. 012705)
Place: New Delhi
Date: May 28, 2019
Directions under Section 143(5) of Companies Act 2013
ANNEXURE - B TO THE INDEPENDENT AUDITOR'S REPORT
Details/ Directions Auditors' Reply Action Taken andImpact onConsolidated Accounts&Consolidated FinancialStatements
Sl.
No.
Whether the company has systemin place to process all theaccounting transactions throughIT system? If yes, the implicationsof processing of accountingtransactions outside IT system onthe integrity of the accounts alongwith the financial implications, ifany, may be stated.
Whether there is any restructuringof an existing loan or cases ofwaiver/write off of debts /loans/interest etc. made by a lender tothe company due to the company'sinability to repay the loan? If yes,the financial impact may be stated.
Whether funds received/receivablefor specific schemes from central/state agencies were properlyaccounted for/ utilized as per itsterm and conditions? List the casesof deviation.
Yes, the Holding company and itssubsidiary company have systemin place to process all theaccounting transactions throughIT system.
As informed to us, there is no suchcase of restructuring of an existingloan or loan/interest etc. made bya lender to the Holding companyand its subsidiary company.
However the Holding company haswritten back the liabilities of` 1095.29 lakh during the yearwhich as per the Holding company,no longer payable in nature.
Based on the information availableand according to the informationand explanations given to us, theHolding company and itssubsidiary company has notreceived any fund for specificschemes from central/ stateagencies during the year.
No impact on the consolidatedaccounts and consolidated financialStatements.
Liabilities of ` 1095.29 lakh werewritten back during the year andimpact of it has been in increase ofprofit by the amount.
No impact on the consolidatedaccounts and consolidated financialstatements.
1.
2.
3.
F-204
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COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION143(6)(b) READ WITH SECTION 129(4) OF THE COMPANIES ACT, 2013 ON THE CONSOLIDATEDFINANCIAL STATEMENTS OF HINDUSTAN COPPER LIMITED FOR THE YEAR ENDED31 MARCH 2019
The preparation of consolidated financial statements of Hindustan Copper Limited for the year ended
31 March 2019 in accordance with the financial reporting framework prescribed under the Companies Act, 2013 (Act) is
the responsibility of the management of the company. The statutory auditor appointed by the Comptroller and Auditor
General of India under Section 139(7) read with section 129(4) of the Act is responsible for expressing opinion on these
financial statements under section 143 read with section 129(4) of the Act based on independent audit in accordance with
the standards on auditing prescribed under section 143(10) of the Act. This is stated to have been done by them vide their
Audit Report dated 28th May 2019.
I, on behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit of the
consolidated financial statements of Hindustan Copper Limited for the year ended 31 March 2019 under Section 143(6)(a)
read with section 129(4) of the Act. We conducted a supplementary audit of the financial statements of Hindustan Copper
Limited and its subsidiary company Chhattisgarh Copper Limited for the year ended on that date. This supplementary
audit has been carried out independently without access to the working papers of the statutory auditors and is limited
primarily to inquiries of the statutory auditors and company personnel and a selective examination of some of the accounting
records.
On the basis of my supplementary audit nothing significant has come to my knowledge which would give rise
to any comment upon or supplement to statutory auditors’ report under Section 143(6)(b) of the Act .
For and on the behalf of the
Comptroller & Auditor General of India
Place : KolkataDate : 24 June 2019
(Suparna Deb)Director General of Commercial Audit& Ex-officio Member, Audit Board-I,
Kolkata
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CONSOLIDATED BALANCE SHEET AS AT 31st MARCH 2019
(` in lakh)
PARTICULARS Note No. As at 31st March, 2019
ASSETS(1) NON-CURRENT ASSETS(a) Property, Plant and Equipment 3A & 3B 31653.72(b) Capital Work In Progress 4 102211.31(c) Financial Assets
(i) Investments 5 -(ii) Others 6 12.47
(d) Deferred Tax Assets (Net) 7 6245.62(e) Non-Current Tax Assets (Net) 8 620.33(f) Other Non-Current Assets 9 53268.78(2) CURRENT ASSETS(a) Inventories 10 64366.77(b) Financial Assets
(i) Investments 11 8.85(ii) Trade receivables 12 36154.83(iii) Cash and cash equivalents 13 663.53(iv) Bank Balances other than above 14 424.19(v) Others 15 3279.93
(c) Other current assets 16 32103.30
Total Assets 331013.63
EQUITY AND LIABILITIES(1) Equity(a) Equity Share Capital 17 46260.90(b) Other Equity 18 116832.25
Attributable to Non Controlling Interest(a) Equity Share Capital 6.50(b) Other Equity (6.45)Liabilities
(2) NON-CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 19 57065.73(ii) Other financial liabilities 20 843.53
(b) Provisions 21 5471.59(3) CURRENT LIABILITIES(a) Financial Liabilities
(i) Borrowings 22 49945.20(ii) Trade Payables 23 20229.08(iii) Other financial liabilities 24 7600.37
(b) Other current liabilities 25 18883.94(c) Provisions 26 6297.04(d) Current Tax Liabilities (Net) 27 1583.96
Total Equity & Liabilities 331013.63
Corporate Information 1Significant Accounting Policies 2General Notes on Accounts 38
The notes referred to above form an integral part of the Financial Statements.
In terms of our report of even date attached.For Chaturvedi & Co.Chartered AccountantsFRN 302137E(CA S C Chaturvedi)Partner(M No. 012705 )
Place : New DelhiDated: 28th May, 2019
For and on behalf of the Board of DirectorsSanjay Kumar Bhattacharya
Director (Mining)( DIN : 07276836)
C.S.SinghiCompany Secretary(M No. FCS 2570)
Sukhen Kumar BandyopadhyayDirector (Finance) & CFO
( DIN : 08173882)
Santosh SharmaChairman and Managing Director
& CEO ( DIN : 07431945)
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PARTICULARS Note No. For the year ended 31st March, 2019
I Revenue from Operations 28 181625.72II Other Income 29 3665.87
III Total Income (I+II) 185291.59
IV EXPENSESCost of Materials Consumed 30 6493.41Changes in Inventories of Finished Goods,
Semi-Finished and Work-In-Process 31 14336.74Employees Benefit Expense 32 31651.48Finance Cost 33 5546.10Depreciation and Amortisation Expense 34 25289.40General,Administration & Other Expenses 35 78964.61
Total Expenses (IV) 162281.74
V PROFIT /(LOSS) BEFORE EXCEPTIONAL ITEMS AND TAX (III-IV) 23009.85VI Exceptional items -
VII PROFIT /(LOSS) BEFORE TAX (V-VI) 23009.85VIII TAX EXPENSE 36
1) Current Tax 9128.932) Deferred Tax (667.91)IX PROFIT /(LOSS) FOR THE PERIOD FROM CONTINUING 14548.83
OPERATIONS AFTER TAX (VII-VIII)IX(A) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Owners (IX-IX(B)) 14555.28IX(B) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Non Controlling Interest (6.45)
X Profit/(Loss) from discontinued operations (34.70)XI Tax expense of discontinued operations (12.13)
XII PROFIT/(LOSS) FROM DISCONTINUED OPERATIONS AFTER TAX (X -XI) (22.57)
XIII PROFIT /(LOSS) FOR THE PERIOD AFTER TAX (IX+XII) 14526.26
XIII (A) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Owners (XIII-XIII(B)) 14532.71XIII (B) PROFIT /(LOSS) FOR THE PERIOD AFTER TAX - Attributable to Non Controlling Interest (6.45)
XIV OTHER COMPREHENSIVE INCOME 37A(i) Items that will not be reclassified to Profit or Loss (1676.21)
A(ii) Income Tax relating to items that will not be reclassified to Profit or Loss -B(i) Items that will be reclassified to Profit or Loss -
B(ii) Income Tax relating to items that will be reclassified to Profit or Loss -XV TOTAL COMPREHENSIVE INCOME FOR THE PERIOD (XIII+XIV)
(Comprising Profit/(Loss) and Other Comprehensive Income for the period ) 12850.05XVI Earning per equity share (for continuing operations)
1 BASIC (`) 1.5732 DILUTED (`) 1.573
XVII Earning per equity share (for discontinued operations)1 BASIC (`) (0.002)2 DILUTED (`) (0.002)
XVIII Earning per equity share (for discontinued & continuing operations)1 BASIC (`) 1.5712 DILUTED (`) 1.571
Corporate Information 1Significant Accounting Policies 2General Notes on Accounts 38The notes referred to above form an integral part of the Financial Statements.
(` in lakh except EPS)
CONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH 2019
In terms of our report of even date attached.For Chaturvedi & Co.Chartered AccountantsFRN 302137E(CA S C Chaturvedi)Partner(M No. 012705 )Place : New DelhiDated: 28th May, 2019
For and on behalf of the Board of DirectorsSanjay Kumar Bhattacharya
Director (Mining)( DIN : 07276836)
C.S.SinghiCompany Secretary(M No. FCS 2570)
Sukhen Kumar BandyopadhyayDirector (Finance) & CFO
( DIN : 08173882)
Santosh SharmaChairman and Managing Director
& CEO ( DIN : 07431945)
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136
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31ST MARCH 2019A
. E
quit
y Sh
are
Cap
ital
Bal
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at t
he b
egin
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of t
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4626
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-46
260.
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Part
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eser
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Fluc
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sR
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Bal
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at t
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1.04
.201
889
65.9
721
166.
24 2
2.78
- -
7631
3.10
1064
68.0
9
Div
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- -
(278
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)(2
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Prof
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ar A
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- Atr
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- -
1453
2.71
1453
2.71
Prof
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r th
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ar A
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- Atr
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able
to N
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ontr
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g In
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st(6
.45)
(6.4
5)
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(167
6.21
)(1
676.
21)
Am
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add
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dur
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the
year
163
.00
155
.94
-31
8.94
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use
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year
- -
(22.
78)
- -
(22.
78)
Bal
ance
at t
he e
nd o
f the
rep
ortin
g pe
riod
31.
03.2
019
8965
.97
2116
6.24
-
163
.00
155
.94
8637
4.65
1168
25.8
0
( ` in
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Sanj
ay K
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irec
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( DIN
: 07
2768
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.Sin
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In te
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date
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705
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8th
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9
For
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Sukh
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O (
DIN
: 07
4319
45)
F-208
137
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH 2019
(` in lakh)
For the year ended31st March 2019
A. CASH FLOW FROM OPERATING ACTIVITIES :NET PROFIT/ (LOSS) BEFORE TAX AS PER PROFIT AND LOSS ACCOUNT 23009.85Adjusted for :
Depreciation 3662.30Provisions charged 1900.97Provisions written back (1095.29)Interest expense 5546.10Dividend declared 0.00Dividend tax payable 0.00Amortisation 21627.10Interest income (334.49)Loss / (Profit) on disposal of fixed assets (48.24)
OPERATING PROFIT/ (LOSS) BEFORE WORKING CAPITAL CHANGES 54268.30Adjusted for :
Decrease/ (Increase) in Trade & other Receivables (28004.35)Decrease/ (Increase) in Inventories 14412.96Decrease/ (Increase) in Current & Non-Current assets (7008.79)Increase/ (Decrease) in Current & Non-Current Liabilities (2833.18)
CASH GENERATED FROM OPERATIONS 30834.94Tax Refund received 1106.54Taxes paid (6730.75)
NET CASH FROM OPERATING ACTIVITIES (A) 25210.73B. CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of Fixed Assets (40045.24)Sale of Fixed Assets 80.07Interest receivedAdvance for / (Recovery of advance) for Capital expenditure 260.68Investment in Subsidiary 0.00Mine Development Expenditure (19369.43)
NET CASH USED IN INVESTING ACTIVITIES ( B ) (58658.21)C. CASH FLOW FROM FINANCING ACTIVITIES :
Non-Current borrowings / (Loan repaid) 52669.68Dividends paid (2313.05)Tax on Dividend (475.45)Interest paid (5422.90)Increase in Other Equity 6.50
NET CASH USED IN FINANCING ACTIVITIES ( C ) 44464.78NET INCREASE IN CASH AND CASH EQUIVALENTS ( A + B + C ) 11017.30CASH AND CASH EQUIVALENTS - opening balance (49136.09)CASH AND CASH EQUIVALENTS - closing balance (38113.46)
( details in Annexure - A )
In terms of our report of even date attached.For Chaturvedi & Co.Chartered AccountantsFRN 302137E(CA S C Chaturvedi)Partner(M No. 012705 )
Place : New DelhiDated: 28th May, 2019
For and on behalf of the Board of DirectorsSanjay Kumar Bhattacharya
Director (Mining)( DIN : 07276836)
C.S.SinghiCompany Secretary(M No. FCS 2570)
Sukhen Kumar BandyopadhyayDirector (Finance) & CFO
( DIN : 08173882)
Santosh SharmaChairman and Managing Director
& CEO ( DIN : 07431945)
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138
ANNEXURE - A
(` in lakh)
CASH AND CASH EQUIVALENTS - opening balance 01/04/2018
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 879.67ii) Current Financial Assets - Bank Balance other that above (Note 14) 379.16
(Excluding Unpaid Dividend of Rs. 12.38 Lakh)iii) Current Financial Assets - Investments (Note 11) 8.18iv) Non-current Financial Assets - Others (Note 6) 1.44v) Current Financial Liabilities - Borrowings (Note 22) (50301.84)
vi) Current Financial Liabilities - Borrowings (Note 22) (102.70)
(49136.09)
CASH AND CASH EQUIVALENTS - closing balance 31/03/2019
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) 663.53ii) Current Financial Assets - Bank Balance other that above (Note 14) 408.33
(Excluding Unpaid Dividend of Rs. 15.86 Lakh)iii) Current Financial Assets - Investments (Note 11) 8.85iv) Non-current Financial Assets - Others (Note 6) 12.47v) Current Financial Liabilities - Borrowings (Note 22) (39300.01)
vi) Current Financial Liabilities - Borrowings (Note 22) 93.37
(38113.46)
The Cash Flow Statement has been prepared as set out in Indian Accounting Standard (IND AS) 7 : STATEMENTof CASH FLOWS, as amended by Companies (Indian Accounting Standards) (Amendment) Rules 2016.
This is the Cash Flow Statement referred to in our report of even date attached.
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH 2019 (Contd.)
F-210
139
HINDUSTAN COPPER LIMITED
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. Corporate Information
Hindustan Copper Limited,established in 1967 and domiciled in India is a Central public sector undertaking under theadministrative control of Ministry of Mines, Government of India. The registered office of the company is situated atKolkata. The principal activities of the company are exploration, exploitation, mining of copper and copper ore includingbeneficiation of minerals, smelting and refining. The Company has copper mines & concentrator plants in MalanjkhandCopper Project at Madhya Pradesh (MCP), Khetri Copper Complex at Rajasthan (KCC) and Indian Copper Complex,Ghatsila at Jharkhand (ICC). The company is operating Smelter & Refinery in ICC and Gujarat Copper Project, Gujarat(GCP) for production of copper cathode. Further, cathode is converted into copper wire rod at Copper wire rod plant atTaloja Copper Project, Taloja, Maharashtra (TCP). The Company is listed with BSE Ltd. and National Stock Exchange ofIndia Ltd.
Chhattisgarh Copper Limited (CCL), established on 21.05.2018 and domiciled in India, is a Joint Venture Company(JVC) formed between Hindustan Copper Limited (HCL) and Chhattisgarh Mineral Development (CMDC) for exploration,mining and beneficiation of copper and its associated minerals in the State of Chhattisgarh. Since HCL holds74% equity in JVC, it is also a Subsidiary of HCL as per Section 2(87) of the Companies Act, 2013.
2. Significant Accounting Policies
2.1 Basis of Accounting
The financial statements are prepared under historical cost convention from the books of accounts maintained underaccrual basis except for certain financial instruments which are measured at fair value and in accordance with theIndian Accounting Standards prescribed under Companies Act, 2013.
2.2 Basis of consolidation
2.2.1 Subsidiaries
Subsidiaries are all entities over which the Company has control. The Company controls an entity when the Company isexposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect thosereturns through its power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the dateon which control is transferred to the Company. They are deconsolidated from the date when control ceases.
The acquisition method of accounting is used to account for business combinations by the Company.
The Company combines the financial statements of the parent and its subsidiaries line by line adding together like itemsof assets, liabilities, equity, cash flows, income and expenses, Intercompany transactions, balances and unrealized gainson transactions between group companies are eliminated.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement ofprofit and loss, consolidated statement of changes in equity and balance sheet respectively.
2.2.2 Equity method
Under the equity method of accounting, the investments are initially recognized at cost and adjusted thereafter to recognizethe Company's share of post acquisition profit or losses of the investee in profit and loss, and the Company's share ofOther Comprehensive Income of the investee in the Other Comprehensive Income.
2.3 Application of Indian Accounting Standards (Ind-AS)
The Company adopted Indian Accounting Standards (Ind AS) from April 1,2016 and accordingly the financial statementshave been prepared in accordance with the recognition and measurement principles as notified by MCA under theCompanies (Indian Accounting Standards) Rules, 2015 ("Ind AS Rules"), of the Companies Act, 2013.
The Company has adopted all the Ind AS as applicable and relevant to the Company.
2.4 Use of Estimates
The preparation of the Company's financial statements requires management to make judgements, estimates and
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
F-211
140
assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanyingdisclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could resultin outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.Revision to accounting estimates are recognised in the period on which the estimates are revised and, if material theireffects are disclosed on the notes to the financial statements.
2.5 Current and Non-current Classification
The Company presents assets and liabilities in the Balance Sheet based on current/non-current classification.An asset istreated as current by the company when:
a) its expects to realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it holds the assets primarily for the purpose of trading;
c) it expects to realize the asset within twelve months after the reporting date; or
d) the asset is cash or cash equivalent (as defined under Ind AS 7) unless the asset is restricted from being exchangedor used to settle a liability for at least twelve months after the reporting period.
Except the above, all other assets are classified as Non-current.
A liability is treated as current by the company when:
a) its expects to settle the liability realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it expects to settle the liability in its normal operating cycle;
c) it holds the liability primarily for the purpose of trading;
d) the liability is due to be settled within twelve months after the reporting period; or
e) it does not have an unconditional right to defer settlement of the liability for at least twelve months after thereporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by theissue of equity instruments do not affect its classification.
Except the above, all other liabilities are classified as non-current.
2.6 Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable and fair value has been defined takinginto account contractually defined terms of payment. Operating revenue recognized is net of all promotional expensesand discounts, rebates and/or any other incentive to customers.
Sale of Products
An entity shall account for a sale contract with a customer only when all of the following criteria are met:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customarybusiness practices) and are committed to perform their respective obligations;
(b) the entity can identify each party's rights regarding the goods to be transferred;
(c) the entity can identify the payment terms for the goods to be transferred;
(d) the contract has commercial substance i.e the risk, ownership, timing or amount of the entity's future cash flowsetc is expected to change as a result of the contract; and
(e) it is probable that the entity will collect the consideration to which it will be entitled in exchange for the goods thatwill be transferred to the customer.
In case of sale of Copper Concentrate, Copper Reverts, Anode Slime etc. and tolling of Copper Concentrate of Khetri andMalanjkhand origin, sales / tolling at the end of the accounting period are recorded on provisional basis as per standardparameters for want of actual specifications and differential sales value are recorded only on receipt of actual. This is asper consistent practice followed by the company.
Sale of Services
Income from conversion of job work is accounted for on the basis of actual quantity dispatched. When the outcome of a
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-212
141
transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shallbe recognized by reference to the stage of completion (Percentage of Completion Method) of the transaction at the end ofthe reporting period.
Advances received from the customers are reported as customer's deposits unless the above conditions for revenuerecognition are met.
Other Operating Revenues
a. Sale of Scrap
Sale of Scrap is accounted for on delivery of material.
b. Interest received from Customers
In case of credit sales ,interest up to the date of Balance Sheet on all outstanding bills is accounted for on accrualbasis.
c. Interest from Contractors against mobilisation advance for mining operations
Interest up to the date of Balance Sheet on all mobilisation advances for mining operations is accounted for onaccrual basis.
d. Penalty and Liquidated Damages
Penalty and liquidated damages are accounted for as and when these are realised by the company as per contractterms.
Other Income
a. Claims
Claims are recognized in the Statement of Profit & Loss (Net of any payable) including receivables from Governmenttowards subsidy, cash incentives, reimbursement of losses,etc, when there is certainty of realisation of such claim andthat can be measured reliably.
b. Dividend and Interest from Investments
Dividend income from Investments is recognised in the Statement of Profit and Loss when the right to receive thedividend has been established and it is certain that the economic benefits will flow to the company and the amount ofincome can be measured reliably.
Interest Income from a financial asset is recognised using Effective Interest Method. When it is probable that the economicbenefits will flow to the Company and the amount of income can be measured reliably.
c. Profit on Sale of Investment
Profit on sale of investment is recognised upon transfer of title by the company and is determined as the differencebetween the sales price and the then carrying value of the investment.
d. Provisions not required written back
Provisions/Liabilities created from business activities in earlier years no longer required are accounted for.
e. Others
Any other income is recognised on accrual basis.
2.7 Employees Benefit
Retirement benefit costs and termination benefits
Payments to defined contribution retirement benefit plans are recognized as an expense when employees have renderedservice entitling them to the contributions.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit creditmethod, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprisingactuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets(excluding interest), is reflected immediately in the statement of financial position with a charge or credit recognized in
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-213
142
other comprehensive income in the period in which they occur. Re-measurement recognized in other comprehensiveincome is reflected immediately in retained earnings and will not be reclassified to Statement of Profit or Loss. Pastservice cost is recognized in Statement of Profit or Loss in the period of a plan amendment. Net interest is calculated byapplying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costsare categorized as follows:
i. Service cost (including current service cost, past service cost, etc.);
ii. Net interest expense or income; and
iii. Re-measurement.
The company presents the first two components of defined benefit costs in profit or loss in the line item 'employee benefitsexpense'.
The retirement benefit obligation recognized in the statement of financial position represents the actual deficit or surplusin the company defined benefit plans. Any surplus resulting from this calculation is limited to the present value of anyeconomic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.
A liability for a termination benefit is recognized at the earlier of when the company can no longer withdraw the offer ofthe termination benefit and when the company recognises any related restructuring costs.
Short-term and other long-term employee benefits
A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick leavein the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchangefor that service.
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefitsexpected to be paid in exchange for the related service.
Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimatedfuture cash outflows expected to be made by the company in respect of services provided by employees up to the reportingdate.
Deficit in Provident Fund
Deficit, if any, in the accounts of Provident Fund Trust ascertained on the basis of last audited accounts of the Trust isaccounted for as a charge to Revenue.
2.8 Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes asubstantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All otherborrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest expenses calculatedusing the effective interest method and other costs that an entity incurs in connection with the borrowing of funds.Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs
2.9 Taxation
Income tax expense represents the sum of current tax and deferred tax.
Current tax
The current tax payable is based on taxable profit for the year as determined from net profit before tax as represented inStatement of Profit and Loss and Other Comprehensive Income, in line with different provisions under Income Tax Act1961.Current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reportingperiod.
Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financialstatements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generallyrecognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporarydifferences to the extent that it is probable that taxable profits will be available against which those deductible temporarydifferences can be utilized.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-214
143
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent thatit is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which theliability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enactedby the end of the reporting period.
Current and Deferred Tax for the year
Current and deferred tax are recognized in Statement of Profit and Loss, except when they relate to items that arerecognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are alsorecognized in other comprehensive income or directly in equity respectively.
2.10 (a) Property Plant and Equipment (PPE)
The cost of an item of PPE is recognized as an asset if and only if, it is probable that future economic benefits associatedwith the item will flow to the company and the cost of the item can be measured reliably. The cost of an item of PPE is thecash price equivalent at the recognition date. The cost of an item of PPE comprises:
i. Purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts andrebates.
ii. Costs directly attributable to bringing the PPE to the location and condition necessary for it to be capable of operatingin the manner intended by management.
iii. The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located,the obligation for which the company incurs either when the PPE is acquired or as a consequence of having used thePPE during a particular period for purposes other than to produce inventories during that period.
The company has chosen the cost model of recognition and this model is applied to an entire class of PPE. After recognitionas an asset, an item of PPE is carried at its cost less any accumulated depreciation and any accumulated impairmentlosses.
Pending reconciliation/receipt of the final bills against capital items, capitalization is done on the basis of cost bookedand depreciation is charged accordingly. Price differences, if any, are adjusted in the year of finalization of bills.
In respect of expenditure during construction/development of a new unit/project in a new location, all direct capitalexpenditure as well as all indirect expenditure incidentals to construction are capitalized allocating to various items ofPPE on an appropriate basis. Expansion programme involving construction concurrently run with normal productionactivities in an existing unit, all direct capital expenditure in relation to such expansion are capitalized but indirectexpenditure are charged to revenue. Borrowing costs that are attributable to the acquisition or construction of qualifyingasset are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial periodof time to get ready for its intended use.
Expenses incurred for implementation of new projects are carried forward against respective projects till execution.Expenses rendered in fructuous projects abandoned subsequently are provided for in the Statement of Profit & Loss.
Physical verification of PPE is conducted every year so that all the units/offices are covered once in a block of three yearsinterval. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts inthe year of identification.
Depreciation and Amortization
The company has used the exemption available in Ind AS 101 with respect to recognition of Plant, Property and Equipment(PPE) and Intangible Assets at their carrying value being deemed cost.
The depreciable amount of an item of PPE is allocated on a straight line basis over its useful life prescribed in Part C ofSchedule II of the Companies Act,2013 or actual useful life of assets assessed by the Technical Committee of the company,whichever is lower. The residual value and the useful life of an asset are reviewed, at each financial year-end. Each partof an item of PPE with a cost that is significant in relation to the total cost of the item is depreciated separately. Depreciationon all such items have been provided from the date they are 'Put to Use' till the date of sale and includes amortization ofintangible assets and lease hold assets. Freehold land is not depreciated. The residual value of all such items is taken at5% of the original cost of individual asset.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-215
144
An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the continueduse of the asset. Certain consumable items of small value whose useful life is very limited are directly charged to revenuein the year of purchase.
From the date Ind AS came into effect, the carrying amount of an asset is depreciated over the remaining useful life of theasset as per estimate of remaining useful life. Wherever, the remaining useful life of an asset is nil, the carrying amountis recognized in the opening balance of retained earnings after retaining the residual value.
2.10 (b) Intangible Assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquiredin a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets arecarried at cost less any accumulated amortisation (calculated on a straight-line basis over their useful lives) andaccumulated impairment losses, if any.
Internally generated intangibles, excluding capitalised development costs, are not capitalised. Instead, the relatedexpenditure is recognised in the Statement of Profit and Loss and other comprehensive income in the period in which theexpenditure is incurred. An internally generated intangible asset arising from development is recognized if all the conditionsstipulated in "Ind AS 38-Intangible Asset" are met. The useful lives of intangible assets are assessed as either finite orindefinite. Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairmentwhenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisationmethod for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changesin the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset areconsidered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates.The amortisation expense on intangible assets with finite lives is recognised in the Statement of Profit and Loss.
An intangible asset with an indefinite useful life is not amortised but is tested for impairment at each reporting date andits useful life is reviewed in each reporting period to determine whether events and circumstances continue to support anindefinite useful life estimate.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposalproceeds and the carrying amount of the asset and are recognised in the Statement of Profit and Loss.
Intangible Assets other than Software are amortized over estimated useful life which is equivalent to license period,generally not more than 5 years.
Cost of Software recognized as intangible asset, is amortised on straight line method over a period of legal right to usewith a nil residual value. Otherwise the cost of software will be charged in the year of incurrence.
2.11 Capital Work in Progress
Assets in the course of construction are included under capital work -in-progress and are carried at cost,less any recognizedimpairment loss. Such capital work-in-progress, on completion, is transferred to the appropriate category of property,plant and equipment.
2.12 (a) Mine Development Expenditure
In case of underground mines : The expenditure on development of a new mine in all cases and on subsequentdevelopment of a working mine is capitalized and depleted on the basis of ore raised during the year and the mineableore reserves estimated from time to time.
In case of working mines, where development activities are going on simultaneously: Expenses are apportionedbetween capital and revenue on the basis of in-house technical estimates.
In respect of open cast mines : The expenditure on removal of waste and overburden, is capitalized and the same isdepleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodicallybased on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines. Subsequently,if any ore is reclaimed from overburden, the same is included in inventory at a value based on opening rate of minedevelopment expenditure with a corresponding credit in Mine development expenditure.
Expenditure incurred on development of new deposits are capital in nature and is included in mine developmentexpenditure. If subsequently the development activities are found to be not viable, the expenditure on such developmentwork included in mine development expenditure is written off in the year in which it is decided to abandon the project.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-216
145
If a working mine is closed due to economic reasons, the un-depleted value of Mine Development Expenditure related tothat mine is provided in the books of accounts in the year in which it is decided to close or suspend operation of the mine.If later on, the closed / suspended mines are re-opened and the company remains the owner of the mines, the unamortizedMine Development Expenditure which was fully provided in the year of closure will be written back in the books ofaccounts in the year of re-opening and the company will be depleting it year wise based on the estimated remaining lifeof that mine.
2.12 (b) Mineral Exploration and Evaluation Expenditures
2.12 (b) (i) Pre-exploration costs
Pre-exploration costs are expensed in the period in which they are incurred.
2.12 (b) (ii) Exploration and Evaluation Assets (E & E Assets)
Once the legal right to explore a property has been acquired, costs directly related to exploration and evaluationexpenditures are recognized and capitalized, in addition to the acquisition costs. These direct expenditures include suchcosts as acquisition of rights to explore, materials used, topographical, geological, geochemical and geophysical evaluation,surveying costs, sampling, drilling costs, activities in relation to evaluation of technical feasibility and commercial viabilityof extracting a mineral resource, consultancy cost, payments made to contractors etc. during the exploration phase. Costsnot directly attributable to exploration and evaluation activities are expensed in the period in which they occur.
Administrative and general overhead cost that are directly attributable to the assets are capitalized as E & E Assets.
E & E Assets may be tangible or intangible. To the extent that a tangible asset is consumed in developing an intangibleasset, the amount reflecting that consumption may be part of the cost of the intangible asset created. However, the assetbeing used remains a tangible asset.
When a project is deemed to no longer have commercially viable prospects for the Company, exploration and evaluationexpenditures in respect of that project are deemed to be impaired. As a result, those exploration and evaluation expenditurecosts, in excess of estimated recoveries, are written off to Statement of Profit &Loss.
The Company assesses exploration and evaluation assets for impairment when facts and circumstances suggest that thecarrying amount of an asset may exceed its recoverable amount.
Once the technical feasibility and commercial viability of extracting the mineral resource has been determined, theproperty is considered to be a mine under development and is classified as "mines under construction".
Exploration and evaluation Assets are also tested for impairment before the assets are transferred to developmentproperties.
As the Company currently has not commenced commercial operations, any incidental revenues, including receipt of inputtax credit receivables, earned in connection with exploration activities are applied as a reduction to capitalized explorationcosts.
An impairment loss is reversed if there is an indication that there has been a change in the estimates used to determinethe recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does notexceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had beenrecognized.
2.13 Overhauling Expenses
Revenue expenditure attributable to overhaul of smelter and/ or refinery is charged off to the Statement of Profit andLoss in the year of incurrence.
2.14 Mine Closure Expenditure & Decommissioning / Site restoration liability
Financial implications towards final mine closure plans under relevant Acts and Rules are technically estimated andMine Closure Reserve is created based on the estimated life of the mines over the period by charging the same to Statementof Profit and Loss.
2.15 Non-Current Assets Held for Sale
The company classifies a non-current asset (or disposal group of assets) as held for sale if its carrying amount will berecovered principally through a sale transaction rather than through continuing use. Immediately before the initialclassification of the asset (or disposal group) as held for sale, the carrying amounts of the asset (or all the assets and
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-217
146
liabilities in the group) are be measured in accordance with applicable Indian Accounting Standards. The sale should beexpected to qualify for recognition as a completed sale within one year from the date of classification except as permittedby Ind AS 105.
2.16 Inventories
Stocks of stores and spare parts, loose tools and materials-in-transit are valued at the lower of the net realizable valueand cost. The raw materials are also valued at the lower of the net realizable value and weighted average cost to the unitif the finished goods in which they will be incorporated are expected to be sold below cost. Loose tools when issued arecharged off to revenue.
Finished goods and work-in-process are valued at the lower of the net realizable value and weighted average cost to theunit. The cost is exclusive of financing cost, such as, interest, bank charges, administration overhead, etc. The value ofslag under work-in-process is taken at equivalent value to the extent credited to the process, where the said productshave been generated. The reverts under work- in-process are valued at lower of cost (equivalent value of concentrate) andnet realizable value.
The stock of anode slime arising from treatment and refining processes are stated at realizable value based on the yearend London Metal Exchange price for gold and silver after making due adjustments of their physical recovery and thetreatment and refining charges.
The inventories out of inter-unit transfers (material in transit) at the close of the year are valued and accounted in thebooks of the transferor unit on the basis of cost plus transportation to the transferee unit.
Imported materials are valued at the lower of the net realizable value and weighted average cost. In the event wherefinal price is not determined valuation is made on provisional cost. Variations are accounted for in the year of finalization.
Provision is made in the accounts every year, for non-moving stores and spares (other than insurance spares) which havenot moved for more than five years. Insurance spares are fully provided for on the expiry of the life of the relevantProperty Plant and Equipments.
Physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all theunits at reasonable intervals during the year by a duly approved committee. Also, physical stock verification of WIP andFinished Goods is undertaken by a duly approved committee at the end of every financial year alongwith an independentagency once in a block of three years. In respect of Stores and Spares, physical verification is carried out by externalagencies once in every year covering all the units. Shortage/(Excesses), if any, identified on such physical verification isduly adjusted in the books of accounts in the year of identification
2.17 Government Grants
All government grants are recognized as deferred income and it will be taken to Statement of Profit and Loss over theperiod of time in accordance with the pattern in which the obligations are met.
2.18 Impairment of Assets (Other than Financial Assets)
The Company assesses at the end of each reporting period whether there is any indication that an asset may be impaired.If any such indication exists, the Company estimates the recoverable amount of the asset. If the recoverable amount of anasset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in Statement ofProfit and Loss, unless the relevant asset is carried at a revalue amount, in which case the impairment loss is treated asa revaluation decrease.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, theestimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects currentmarket assessments of the time value of money and the risks specific to the asset for which the estimates of future cashflows have not been adjusted.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increasedto the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carryingamount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit)in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the relevant asset iscarried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-218
147
2.19 Foreign Exchange Transactions
Transactions in currencies other than the company's functional currency (foreign currencies) are recognized at the ratesof exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the ratesprevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are re-translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measuredin terms of historical cost in a foreign currency are not retranslated.
Foreign currency monetary items (except overdue recoverable where realizability is uncertain) are converted using theclosing rate as defined in the Ind AS-21. The effects of changes in Foreign Exchange Rates, non-monetary items arereported using the exchange rate at the date of the transaction. The exchange difference gain/loss is recognized in theStatement of Profit and Loss.
In case of long term foreign currency monetary items outstanding as of 31st March 2016, liability in foreign currencyloans relating to acquisition of fixed assets is converted using the closing rate as defined in Ind AS 21-The effects ofchanges in Foreign Exchange Rates and the difference in exchange is recognized in terms of exemptions given in paragraphD13AA of Appendix D to Ind AS-101, where the effect of exchange differences on foreign currency loans of the company isaccounted for by addition or deduction to the cost of the assets so far it relates to the depreciable capital assets and shallbe depreciated over the balance life of the assets.
Other long term foreign currency monetary items are accumulated in 'Equity Component of Foreign Currency asset/liability Account' and amortized over the balance period of the asset/liability by recognition as income or expense in eachof such periods as stated under Para 29A of Ind AS 21.
2.20 Provisions, Contingent Liabilities & Contingent Assets
Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past eventand it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of theamount of the obligation.
Wherever no reliable estimate could be made, a disclosure is made as contingent liability. A disclosure for a contingentliability is also made when there is a possible obligation or a present obligation that may but probably will not require anoutflow of resources.
When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote,no provision or disclosure is made.
Contingent Liabilities are disclosed in the General Notes forming part of the accounts.
Contingent Assets are not recognised in the financial statements but are disclosed in Notes to the Accounts. Such assetsoccur when the inflow of economic benefits is probable. Such contingent assets are assessed continuously, if it is virtuallycertain that inflow of economic benefits will arise then such assets and the relative income will be recognised in thefinancial statements.
2.21 Leasing
Assets held under lease, in which a significant portion of the risks and rewards of ownership are transferred to lessee areclassified as finance leases. All other leases are classified as operating leases.
Depreciation expenses are recorded if asset held under finance lease is depreciable.
Finance expenses are recognized immediately in the Statement of Profit and Loss if they are not directly attributable toqualifying assets, otherwise they are capitalised in accordance with the company's general policy on borrowing costs.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term.
2.22 Financial Instruments
Non Derivative Financial Instruments
(i) Initial Recognition
Financial assets and financial liabilities are recognized when the company becomes a party to the contractual provisionsof the instruments.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-219
148
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributableto the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilitiesat fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financialliabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financialassets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.
(ii) Subsequent Recognition
a. Financial assetsFinancial assets are subsequently measured at amortised cost, fair value through other comprehensive income orfair value through profit or loss.
b. Financial LiabilitiesFinancial liabilities are subsequently measured at amortized cost using Effective Interest Rate (EIR) methodexcept for derivatives, which are measured at fair value.
Derivative Financial Instruments
All derivatives are recognized and measured at fair value with changes in fair value being recognized in profit or loss forthe period.
Impairment of Financial Assets
At each reporting date, assessment is made whether the credit risk on a financial instrument has increased significantlyor not since initial recognition.
If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance ismeasured for that financialinstrument at an amount equal to 12 month expected credit losses. If the credit risk on thatfinancial instrument has increased significantly since initial recognition, the loss allowance is measured for a financialinstrument at an amount equal to the lifetime expected credit losses.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date isrecognised as an impairment gain or loss in the Statement of Profit and Loss.
2.23 Events Occurring after the Reporting Period
The company adjusts the amount recognized in its financial statements to reflect adjusting material events after thereporting period and does not adjust the amount to reflect non-adjusting events after the reporting period. Howeverwhere retrospective restatement is not practicable for a particular prior period then the circumstances that lead to theexistence of that condition and the description of how and from where the error is corrected are disclosed in Notes onAccounts.
2.24 Dividend
Final dividend on shares are recorded as a liability on the date of approval by the shareholders in general meeting andinterim dividends are recorded as a liability on the date of declaration by the directors in the meeting of the Board ofDirectors.
2.25 Cash and Cash Equivalents
Cash and cash equivalent in the Balance Sheet comprise cash at bank and on hand and short term deposit with anoriginal maturity of three months or less which are subject to insignificant risk of changes in value.
2.26 Rounding of amounts
Amounts in these financial statements have, unless otherwise indicated, have been rounded off to ‘ in lakh’ upto twodecimal points.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-220
149
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
Not
e : 3
(A
) Pro
pert
y,P
lant
and
Equ
ipm
ent (
Act
ive
Ass
ets)
DESC
RIPT
ION
Free
Hol
dLa
nd
Build
ings
incl
udin
gSa
nita
ry a
nd W
ater
Supp
ly S
yste
m
Plan
t,M
achi
nery
and
Min
ing
Equi
pmen
t
Furn
iture
&Fi
xtur
es &
Offic
eEq
uipm
ent
Railw
aySi
ding
Vehi
cles
Road
s,Br
idge
s and
Culv
erts
Elec
tric
alEq
uipm
ent
and
Inst
alla
tion
Shaf
ts a
ndin
clin
esTo
tal
Gro
ss C
arry
ing
Amou
nt
Gros
s Car
ryin
g Amo
unt
as
at 01
.04.20
1824
46.58
6748
.3224
190.4
246
1.30
189.4
018
26.38
293.8
726
75.57
444.8
139
276.6
5Ex
chan
ge D
iffer
ence
s-
--
--
--
--
-Ad
dition
s
-
285.9
726
67.66
50.82
--
-88
.85 -
3093
.30In
ter-h
ead
Tran
sfer I
n /(O
ut)
-(30
1.00)
3
37.90
(155.0
0)-
- -
118.1
0 -
-Tr
ansfe
r Fro
m D
iscar
ded A
ssets
--
0.60
-0.2
0-
- -
-0.8
0Tr
ansfe
r To D
iscar
ded A
ssets
-(0.
46)
(1039
.16)
(33.30
)(19
.26)
--
(4.11
)(0.
60)
(1096
.89)
Disp
osals
-
-
(29.34
)(0.
21)
(2.11
) -
-
(0.17
) -
(31.83
)Im
pairm
ent L
osse
s Pro
v.Tr
f to D
iscar
ded A
ssets
-
-
464.0
1
-
-
- -
- -
464.0
1Ad
justm
ents
-(3.
98)
(4.03
)(0.
14)
0.01
0.01
(0.01
)(0.
02)
-(8.
16)
Gros
s Car
ryin
g Am
ount
as a
t 31.0
3.201
924
46.58
6728
.8526
588.0
632
3.47
168.2
418
26.39
293.8
628
78.22
444.2
141
697.8
8
Accu
mul
ated
Dep
reci
atio
n &
Impa
irmen
t
Accu
mulat
ed D
epre
ciatio
nas
at 0
1.04.2
018
-90
8.82
3787
.3615
5.81
33.28
653.4
965
.3444
4.83
27.98
6076
.91De
prec
iation
char
gedu
ring t
he ye
ar -
526.3
827
49.59
59.95
30.62
333.9
032
.6722
0.15
13.99
3967
.25In
ter-h
ead
Tran
sfer I
n /(O
ut)
-60
7.50
(610.7
9)(11
0.30)
- -
-11
3.59
--
Tran
sfer F
rom
Disc
arde
d Ass
ets -
-
- -
- -
--
--
Tran
sfer T
o Disc
arde
d Ass
ets-
-
- -
- -
--
--
Impa
irmen
t Los
ses
-
-
-
- -
- -
--
-Ex
chan
ge D
iffer
ence
s
-
-
--
- -
--
--
Disp
osals
-
-
-
- -
- -
--
-
Accu
mul
ated
Dep
reci
aton
&Im
pairm
ent a
s at 3
1.03.2
019
-
2042
.7059
26.16
105.4
663
.9098
7.39
98.01
778.5
741
.9710
044.1
6
Net C
arry
ing
Amou
nt
as a
t 31.0
3.201
924
46.58
4686
.1520
661.9
021
8.01
104.3
483
9.00
195.8
520
99.65
402.2
431
653.7
2
Note
: HCL
has u
sed t
he ex
empt
ion av
ailab
le in
Ind A
S 101
with
resp
ect t
o rec
ogni
tion o
f Pro
perty
, Plan
t, Eq
uipm
ent (
PPE)
and I
ntan
gible
Asse
ts at
their
carry
ing v
alue.
(` in
lakh
)
F-221
150
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)DE
SCRI
PTIO
NFr
ee H
old
Land
Build
ings
incl
udin
gSa
nita
ry a
nd W
ater
Supp
ly S
yste
m
Plan
t,M
achi
nery
and
Min
ing
Equi
pmen
t
Furn
iture
&Fi
xtur
es &
Offic
eEq
uipm
ent
Railw
aySi
ding
Vehi
cles
Road
s,Br
idge
s and
Culv
erts
Elec
tric
alEq
uipm
ent
and
Inst
alla
tion
Shaf
ts a
ndin
clin
esTo
tal
Gro
ss C
arry
ing
Amou
nt
Gros
s Car
ryin
g Amo
unt
as a
t 01.0
4.201
83.6
418
1.45
372.9
36.2
64.0
324
.93-
58.17
91.70
743.1
1Ex
chan
ge D
iffer
ence
s-
--
--
--
--
-Ad
dition
s-
--
--
--
--
-In
ter-h
ead
Tran
sfer I
n /(O
ut)
--
--
--
--
--
Tran
sfer F
rom
Acti
ve A
ssets
-
0
.4610
39.16
33.30
19.26
--
4.11
0.60
1096
.89Tr
ansfe
r To A
ctive
Ass
ets-
-(0.
60)
-(0.
20)
--
--
(0.80
)Di
spos
als
-
-(0.
64)
--
--
--
(0.64
)Im
pairm
ent L
osse
s-
-(46
4.01)
--
--
--
(464.0
1)Ad
justm
ents
--
--
--
--
--
Gros
s Car
ryin
g Am
ount
as a
t 31.0
3.201
93.6
418
1.91
946.8
439
.5623
.0924
.930.0
062
.2892
.3013
74.55
Accu
mul
ated
Dep
reci
atio
n
& Im
pairm
ent
Accu
mulat
ed D
epre
ciatio
n as
at 0
1.04.2
018
-
-
-
- -
- -
--
-De
prec
iation
char
gedu
ring t
he ye
ar -
-
- -
- -
--
--
Inter
-hea
d Tr
ansfe
r In /
(Out
)-
-
- -
- -
--
--
Tran
sfer F
rom
Disc
arde
d Ass
ets -
-
- -
- -
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F-222
151
(` in lakh)
PARTICULARS As at31st March, 2019
Note No 4 CAPITAL WORK IN PROGRESS
i) Building 24.22ii) Plant & Machinery 33836.57
iii) Others including Mine Expansion 72439.01106299.80
Less: Provision 4088.49TOTAL 102211.31
Note No 5 NON - CURRENT FINANCIAL ASSETS - INVESTMENTS
i) Non Trade Investment in Debentures 0.17Less : Provision for diminution in value 0.17 -
TOTAL -
AGGREGATE BOOK VALUE - UNQUOTED Nil
AGGREGATE BOOK VALUE - QUOTED -
MARKET PRICE OF QUOTED INVESTMENT -
Note No 6 NON - CURRENT FINANCIAL ASSETS - OTHERS
Bank deposits with more than 12 months maturity 12.47
TOTAL 12.47
Note No 7 DEFERRED TAX ASSETS (NET)
i) DEFERRED TAX ASSET
OPENING BALANCE 8780.81
Adjustment/Credit during the year 463.09
CLOSING BALANCE 9243.90
ii) DEFERRED TAX LIABILITY
OPENING BALANCE (3203.10)
Adjustment/Credit during the year 204.82
CLOSING BALANCE (2998.28)
i)-ii) DEFERRED TAX ASSETS / (LIABILITIES) (Net) 6245.62
(Refer Note No. 38 General Notes on Accounts Point No. 20)
Note No 8 NON-CURRENT TAX ASSETS (Net)
Income Tax (including advance income tax, TDS& excluding current tax liability) Unsecured - Considered good 620.33
TOTAL 620.33
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-223
152
(` in lakh)PARTICULARS As at
31st March, 2019
Note No 9 OTHER NON - CURRENT ASSETSa) MOBILISATION ADVANCESi) Secured (considered good) 2178.89
ii) Unsecured (considered good)– Against Bank Guarantee -– Others -
iii) Unsecured (considered doubtful) 0.02Less: Provisions for Capital Advances * 0.02 -
b) Other Loans & AdvancesReceivable from MPSEB 828.53
c) Mine Development ExpenditureAs per Last Balance Sheet 53068.54Add: Expenditure during the year (as per Note Below) 19898.22
72966.76Less: Value of Ore recovered during Mine Development 223.84Less: Amortisation during the Year 21627.10 21850.94
51115.82Less: Provision 4664.86TOTAL 46450.96Note: MINE DEVELOPMENT EXPENDITURE DURING THE YEAR
i) Salaries, Wages, Allowances 2182.50ii) Contribution to Provident & Other Funds 170.84
iii) Workmen & Staff Welfare Expenses 9.03iv) Stores, Spares & Tools Consumed 2369.33v) Power, Fuel & Water 475.32
vi) Royalty 16.10vii) Repair & Maitenance 4222.59
viii) Insurance 1.76ix) Overburden Removal Expenditure 9711.09x) Depreciation 304.95
xi) Other Expenses 434.71TOTAL 19898.22
The above expenditure is in addition to the expenses shown under the respective natural head of accounts indicated andcharged in the Statement of Profit and Loss Account for the year and in the relevant schedules thereof.Amortisation during the year is in relation to the expenses incurred on mines which are under operation/productionand does not include expenditure on prospecting of minerals in new mines area.
d) Prepaid ExpensesExpenses on Leasehold Land 3810.40TOTAL 3810.40TOTAL (a+b+c+d) 53268.78PROVISIONS FOR CAPITAL ADVANCES *OPENING BALANCE 0.02Additions during the year -Amount used during the year -CLOSING BALANCE 0.02
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-224
153
(` in lakh)PARTICULARS As at
31st March, 2019Note No 10 INVENTORIES
i) Raw Materials -
ii) Semi-Finished and In-Process (at lower of cost or
net realisable value) 58249.42
Less: Provision for Semi-Finished and In-Process * 123.03 58126.39
iii) Finished Goods (at lower of cost or net realisable value) 1176.03
iv) Stores and spares 7371.35
Stores in transit/ pending inspection 309.03
7680.38
Less: Provision for Obsolete Stores & Spares ** 2616.03 5064.35
TOTAL 64366.77
PROVISION FOR SEMI-FINISHED AND IN-PROCESS *
OPENING BALANCE 123.03
Additions during the year -
Amount used during the year -
CLOSING BALANCE 123.03
PROVISION FOR OBSOLETE STORES & SPARES **
OPENING BALANCE 2534.25
Additions during the year 106.81
Amount used during the year 25.03
CLOSING BALANCE 2616.03
Note No 11 CURRENT FINANCIAL ASSETS - INVESTMENTS
Investments in Mutual Fund
(Maturity within 3 months from
date of original investments) Number of units NAV (in `)
UTI MONEY MARKET - GROWTH 51.736 2112.55 1.09
SBI ULTRA SHORT TERM DEBT FUND - GROWTH 132.120 4169.40 5.51
CANARA REBECO LIQUID FUND - GROWTH 38.993 2258.68 0.88
IDBI LIQUID FUND - GROWTH 68.469 2002.99 1.37
TOTAL 8.85
AGGREGATE BOOK VALUE - UNQUOTED Nil
AGGREGATE BOOK VALUE - QUOTED 7.84
MARKET PRICE OF QUOTED INVESTMENT 8.85
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-225
154
Note No 12 CURRENT FINANCIAL ASSETS - TRADE RECEIVABLESDEBTS OUTSTANDING
i) - Secured - Considered good 36154.83
ii) - Unsecured - Considered good -iii) - Considered doubtful 942.77
37097.60
Less: Allowances for bad & doubtful debts * 942.77 36154.83
TOTAL 36154.83ALLOWANCES FOR BAD & DOUBTFUL DEBTS *OPENING BALANCE 935.89
Additions during the year 22.46
Amount used during the year 15.58CLOSING BALANCE 942.77
Explanatory Note: -
Debt due by Directors or other officers of the company or any of them either severally or jointly with any other person ordebts due by firms or private companies respectively in which any Director of the Company is a partner or a Director ora member amounts to ` Nil (Previous year ` Nil).
Note No 13 CURRENT FINANCIAL ASSETS - CASH & CASH EQUIVALENTSI. CASH AND CASH EQUIVALENTS
i. Cash on hand including imprest 0.25
ii. Balance with Banks
-Current Account 663.28II. OTHER BALANCES WITH BANK
Bank deposits upto 3 months maturity from date of original investment- with scheduled banks -TOTAL 663.53
Note No 14 CURRENT FINANCIAL ASSETS - BANK BALANCEOTHER THAN CASH & CASH EQUIVALENTS
I. Other Balances with Bank
- in Dividend Balance Account 15.86
II. Bank deposits with more than 3 months and upto 12 months maturity- with scheduled banks 408.33TOTAL 424.19
(` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-226
155
Note No 15 CURRENT FINANCIAL ASSETS - OTHERS
a) ADVANCESEmployees- Secured (considered good) 69.84- Unsecured (considered doubtful) 2.03Less : Provisions for doubtful advances * 2.03TOTAL 69.84
b) INTEREST ACCRUED ONi) LC from Customers 0.78
ii) Investments 9.16iii) Deposits 23.92iv) Others 0.58 34.44
c) CLAIMS RECOVERABLEClaims recoverable from different agencies 3308.75Less: Provision for Doubtful Claims ** 133.10 3175.65
TOTAL (a+b+c) 3279.93
DETAILS OF PROVISIONS
PROVISION FOR DOUBTFUL ADVANCES *
OPENING BALANCE 2.03Additions during the yearAmount used during the year -CLOSING BALANCE 2.03
PROVISION FOR DOUBTFUL CLAIMS **
OPENING BALANCE 133.14Additions during the year -Amount used during the year 0.04CLOSING BALANCE 133.10
Explanatory Note: -
PARTICULARS OF LOANS AND ADVANCES DUE FROM DIRECTORSi) Amount due at the end of the year ` Nilii) Advance due by firms or private companies in which any Director of the Company is a Partner or adirector or a member amounts to ` Nil
(` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-227
156
Note No 16 OTHER CURRENT ASSETS
a) Advances to contractors / suppliers- Secured (considered good) 218.29- Unsecured (considered good) - – Against Bank Guarantee – Others 2099.84- Unsecured (considered doubtful) 723.33
3041.46b) Other Advances
- secured (considered good) 50.90- Unsecured (considered doubtful) 13.93
64.833106.29
Less : Provision for Doubtful Loans and Advances * 737.262369.03
c) DEPOSITSOther Deposits 9392.51Less : Provision for Doubtful Deposits ** 75.56
9316.95d) OTHER CURRENT ASSETS
Other Current Assets 277.33Less: Provision for Other Current Assets *** 3.52
273.81e) OTHER RECOVERABLES
IGST/CGST & SGST 20002.22f) PREPAID EXPENSES
Rent for Leasehold Land 141.29TOTAL 32103.30DETAILS OF PROVISIONSPROVISION FOR DOUBTFUL LOANS AND ADVANCES *OPENING BALANCE 728.63Additions during the year 8.63Amount used during the year -CLOSING BALANCE 737.26PROVISIONS FOR DOUBTFUL DEPOSITS **OPENING BALANCE 75.56Additions during the year -Amount used during the year -CLOSING BALANCE 75.56PROVISION FOR OTHER CURRENT ASSETS ***OPENING BALANCE 3.52Additions during the year -Amount used during the year -CLOSING BALANCE 3.52
(` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-228
157
Note No 17 EQUITY SHARE CAPITAL
a) AUTHORISED SHARE CAPITAL
- Equity Share Capital 1800000000 90000.00
- 7.50% Non-Cum. Redeemable Preference Shares of HCL 2000000 20000.00
b) PAR VALUE PER EQUITY SHARE (in `) ` 5
c) PAR VALUE PER PREFERENCE SHARE (in `) for HCL 1000.00
d) NO. OF SHARES ISSUED, SUBSCRIBED AND FULLY PAID UP- Equity Share Capital of HCL 925218000 46260.90
- 7.50% Non-Cum. Redeemable Preference Shares of HCL - -
TOTAL 46260.90
e) RECONCILIATION OF NO. OF SHARES & SHARE CAPITALOUTSTANDING: No. of Shares (` in lakh)
OUTSTANDING AS ON 01.04.2018 925218000 46260.90
Add: Share Capital issued/ subscribed during the year - -
Less: Reduction in Share Capital - -
OUTSTANDING AS ON 31.03.2019 925218000 46260.90
f) TERMS/RIGHTS ATTACHED TO EQUITY SHARES
The Company has only one class of Equity Shares having par value of ` 5/- each and is entitled to onevote per share.
g) SHARES IN THE COMPANY HELD BY EACH SHAREHOLDER HOLDING MORE THAN 5 PERCENTOF THE NUMBER OF SHARES
In No. (%)
For HCL
- President of India 703587852 76.05%
- Life Insurance Corporation of India 112338152 12.14%
For Subsidiary
- HCL 185000 74.00%
- CMDC LTD 65000 26.00%
In No. (` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-229
158
Note No 18 OTHER EQUITY
a) CAPITAL RESERVE *AS PER LAST BALANCE SHEET 21166.24
b) GENERAL RESERVEAS PER LAST BALANCE SHEET 8965.97
c) CORPORATE SOCIAL RESPONSIBILITY FUNDAS PER LAST BALANCE SHEET 22.78Add: During the year -Less: Amount reversed during the year -Less: Amount used during the year 22.78AS AT BALANCE SHEET DATE -
d) MINE CLOSURE RESERVESAS PER LAST BALANCE SHEET -Add: During the year 163.00Less: Amount reversed during the year -Less: Amount used during the year -AS AT BALANCE SHEET DATE 163.00
f) CURRENCY FLUCTUATION RESERVE **AS PER LAST BALANCE SHEETAdd: Equity Component of Foreign Currency Loan 155.94Less: Amount reversed during the year -Less: Amount used during the year -AS AT BALANCE SHEET DATE 155.94
g) RETAINED EARNING *** 86381.10TOTAL 116832.25
Details of Retained Earning ***Profit /(Loss) for the period after tax - Consolidated 14526.26Less : Profit /(Loss) for the period after tax - Attributable to Non Controlling Interest (6.45)Profit /(Loss) for the period after tax - Attributable to Owners 14532.71Other Comprehensive Income as per Statement of Profit and Loss (1676.21)Total Comprehensive Income for the period 12850.05Total Comprehensive Income for the period- Attributable to Owners 12856.50Balance brought forward 76313.10BALANCE AVAILABLE FOR APPROPRIATION 89169.60
i) Less :Dividend 2313.05ii) Less :Tax on Dividend 475.45
BALANCE CARRIED FORWARD 86381.10* Capital Reserve is created from the Grant received from the Government of India during the approval of FinancialRe-structuring proposal by Ministry of Mines and out of Capital Profits over the years.This Reserve is not created out ofRevenue Profits of the Company.** Currency Fluctuation Reserve is not created out of Revenue Profits of the Company.
(` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-230
159
Note No 19 NON-CURRENT FINANCIAL LIABILITIES - BORROWINGS
LONG TERM LOANS • From Banks/ FIs - Secured - EXIM Bank (Loan I) 5443.02(The title deeds for Freehold and Leasehold Land and Building acquired in
respect of Gujarat Copper Project are yet to be executed. Pending the same, thetitle deeds of land of TCP has been submitted as an alternate security over whichno hypothecation has been created.)
-EXIM Bank (Loan II) 28215.21(First pari-passu charge on movable fixed assets, both present and future of theCompany, excluding GCP and TCP)
- SBI 17407.50(First pari-passu charge on immovable fixed assets of the Company located at
MCP, both present and future , excluding leasehold land/property)- Unsecured - Axis Bank 6000.00TOTAL 57065.73
Note No 20 NON-CURRENT FINANCIAL LIABILITIES - OTHERS OTHERS (Compensation received from Govt of Jharkhand for repair of township) 843.53TOTAL 843.53
Note No 21 NON - CURRENT - PROVISIONSPROVISION FOR EMPLOYEE BENEFITS
i) PROVISION FOR LEAVE ENCASHMENTAS PER LAST BALANCE SHEET 11930.19Additions during the year -Amount used during the year 1009.87CLOSING BALANCE 10920.32
ii) PROVISION FOR GRATUITYAS PER LAST BALANCE SHEET (3743.46)Additions during the year 1094.73Amount used/funded during the year 2800.00CLOSING BALANCE (5448.73)TOTAL 5471.59(Refer Note No. 38 General Notes on Accounts Point No. 22)
(` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-231
160
Note No 22 CURRENT FINANCIAL LIABILITIES - BORROWINGSSHORT TERM LOANSi) From Banks/ FIs- Secured (Secured by hypothecation of Stock-in-
Trade,Stores & Spare Parts and Book Debts, both presentand future of the Group) 16503.81 ii) Working Capital Term Loan (Unsecured)
- Axis Bank 9702.84- Kotak Mahindra Bank -- HDFC Bank 13000.00iii) Buyers' Credit -
LONG TERM LOANS • Due in next 1 yeari) EXIM Bank (Loan I) 5443.04
ii) EXIM Bank (Loan II) 1795.51iii) Axis Bank 3500.00
TOTAL 49945.20
Note No 23 CURRENT FINANCIAL LIABILITIES - TRADE PAYABLE
i) Total outstanding dues of micro entreprises and small enterprises 535.45
ii) Total outstanding dues of creditors other than microenterprises and small enterprises 19693.63TOTAL 20229.08
Note No 24 CURRENT FINANCIAL LIABILITIES - OTHERSi) Interest accrued but not due on borrowings & term loans 359.97
ii) Unpaid dividend 15.86iii) Deposits/ Retention money 5885.05iv) Other liabilities 1339.49
TOTAL 7600.37
Note No 25 OTHER CURRENT LIABILITIES
i) Statutory dues payables 4665.09ii) Advances from Customers 1977.75
iii) Sundry Creditors - Others 12241.10TOTAL 18883.94
(` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-232
161
Note No 26 CURRENT - PROVISIONSa) PROVISION FOR EMPLOYEE BENEFITSi) PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 741.60Additions during the year 1239.25Amount used during the year -CLOSING BALANCE 1980.85
ii) PROVISION FOR GRATUITYAS PER LAST BALANCE SHEET (3513.13)Additions during the year 652.24Amount used during the year -CLOSING BALANCE (2860.89)
iii) PROVISION FOR LEAVE TRAVEL CONCESSION (LTC)AS PER LAST BALANCE SHEET 139.11Additions during the year 32.82Amount used during the year -CLOSING BALANCE 171.93
iv) PROVISION FOR PRP/INCENTIVEAS PER LAST BALANCE SHEET 882.00Additions during the year 1145.00Amount used during the year 300.00CLOSING BALANCE 1727.00
v) PROVISION FOR WAGE REVISIONAS PER LAST BALANCE SHEET 5621.17Additions during the year -Amount used during the year 1362.90CLOSING BALANCE 4258.27
b) OTHERSi) DIVIDEND
AS PER LAST BALANCE SHEET -Additions during the year 2313.05Amount used during the year 2313.05CLOSING BALANCE -
ii) TAX ON DIVIDENDAS PER LAST BALANCE SHEET -Additions during the year 475.45Amount used during the year 475.45CLOSING BALANCE -
iii) PROVISION - OTHERSAS PER LAST BALANCE SHEET 1366.75Additions during the year 33.60Amount used during the year 380.47CLOSING BALANCE 1019.88TOTAL 6297.04(Refer Note No. 38 General Notes on Accounts Point No. 21)
Note No 27 CURRENT TAX LIABILITIES (Net)Additions during the year 8644.62Less : Refund pertaining to earlier years 310.58Less : Advance Income Tax & TDS 6750.08Current Tax Liabilities (Net of Advance Tax & TDS) 1583.96
(` in lakh)PARTICULARS As at
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-233
162
Note No 28 REVENUE FROM OPERATIONSSALE OF PRODUCTS- Domestic 91076.52- Export 84267.33
175343.85Less : Discount & Rebate 14.55SALES (Net of Discounts) (A) 175329.30SALE OF SERVICES (B) 455.70OTHER OPERATING INCOME (C)-Sale of Scrap 987.36-Interest received from Customers 246.35-Interest received from Contractors against mobilization advances for mining operations 262.80-Penalty & Liquidated Damages 1752.00Less : Refunded during the year 203.57 1548.43-Excess Electricity Charges earlier paid adjusted by MPSEB against current Electricity bills 2795.78(Refer Note No. 38 General Notes on Accounts Point No.12)- Exchange Rate Variation -TOTAL (C) 5840.72TOTAL (A+B+C) 181625.72
Note No 29 OTHER INCOME- Claims Received 10.44- Interest from Term Deposits 96.62- Interest - Others 237.87- Profit on sale of Assets 48.24- Profit on Sale of Investment -- Profit on Fair Value of Investment 0.67- Others 2176.74- Provisions not required written back # 1095.29TOTAL 3665.87Details of Provisions not required written back # (Refer Note No.38 GeneralNotes on Accounts Point No.13)Bad and doubtful Debts, advances / deposits & claims 16.56Excess provisions on account of shortage, non-moving,Obsolete & insurance Stores & Spares and finished goods 26.93Provision for Discarded Assets no longer required 1.16Provision for CSR no longer required Written Back 30.59Provision for Interest on MSME 169.94Provision for MP Rural Infrastructure & Road Development Tax & Water Charges 370.78Old Liability Written Back for S.Creditors, SD & EMD more than 5 years and Others 479.33TOTAL 1095.29
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
(` in lakh)PARTICULARS For the year ended
31st March, 2019
F-234
163
Note No 30 COST OF MATERIALS CONSUMEDRaw Materials Consumed 6269.57Value of Ore Raised During Mine Development 223.84TOTAL 6493.41
Note No 31 CHANGES IN INVENTORIES OF FINISHED GOODS,SEMI-FINISHED AND WORK- IN-PROCESS
A. OPENING STOCK:Finished Goods 257.24Semi-Finished and In-Process 73504.95TOTAL OPENING STOCK 73762.19
B. CLOSING STOCK:Finished Goods 1176.03Semi-Finished and In-Process 58249.42TOTAL CLOSING STOCK 59425.45(INCREASE)/ DECREASE (A-B) 14336.74
Note No 32 EMPLOYEES BENEFIT EXPENSESalaries, Wages & Allowances 23320.29Bonus/Ex-gratia/Performance Related Pay 1426.21Contribution to Provident & Other Funds 2263.98Workmen & Staff Welfare Expenses 1696.74Gratuity & Leave Encashment 2944.26TOTAL 31651.48Explanatory Note: -The detail of Remuneration paid/payable to Directors as included in above payments are as follows: -
(i) Salaries & Allowances 212.32(ii) Contribution to Provident & Other Funds 13.99
(iii) Re-imbursement of Medical Expenses 0.53(iv) Leave Encashment 13.23(v) Gratuity paid 10.00
TOTAL 250.07In addition the Whole-time Directors are allowed the use of company car for private purpose and have been provided withresidential accomodation as per terms of their appointment / Government guidelines and the charges are recovered atthe rates prescribed by the Government.Note No 33 FINANCE COST
- Interest on Cash Credit 1339.00- Others ( including Term Loans) 4207.10TOTAL 5546.10
Note No 34 DEPRECIATION AND AMORTISATION EXPENSEA. DEPRECIATION
Depreciation for the year 3967.25Less: Depreciation transferred to Mine Development Expenditure 304.95SUB TOTAL (A) 3662.30
B. AMORTISATIONAmortisation during the year * 21627.10SUB TOTAL (B) 21627.10TOTAL (A+B) 25289.40
* Amortisation during the year is in relation to the expenses incurred on mines which are under operation/productionand does not include expenditure on prospecting of minerals in new mines area.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
(` in lakh)PARTICULARS For the year ended
31st March, 2019
F-235
164
Note No 35 OTHER EXPENSESA. OTHER MANUFACTURING EXPENSES
- Stores ,Spares& Tools Consumed 11706.53- Consumption of Power, Fuel & Water 22186.57- Royalty, Cess & Decretal amount 9803.47- Contractual Job for Process 13905.88- Handling & Transportation 6811.67- Tolling Charges -- Expenses for Leasehold Land 141.29SUB TOTAL (A) 64555.41
B. REPAIRS & MAINTENANCE & MAJOR OVERHAUL EXPENSES- Building 195.08- Machinery 4889.34- Others 681.86SUB TOTAL (B) 5766.28
C. ADMINISTRATION EXPENSES- Insurance 204.77- Rent 137.83- Rates and Taxes 766.15- Security Expenses 970.41- Travelling and Conveyance 562.57- Telephone, Telex and Postage 144.03- Advertisement and Publicity 174.90- Printing and Stationery 125.70- Books & Periodicals 3.63- Consultancy Charges - Indigenous 757.67- Loss on Sale of Assets(Net) -- Exchange Rate Variation(Net) 0.17- Bad debts / advances/ claims written off- MTM Debit Foreign Exchange 1071.48- MTM Debit/Credit & Hedging Expenses -- Research & Development Expenses -- Corporate Social Responsibility Expenses 185.38- Hire Charges 389.86- Audit Expenses (Refer detail below at Sl 1) 30.28- Independent Directors Expenses 10.35- Bank Charges 155.01- Other General Expenses 1051.91SUB TOTAL (C) 6742.10
D. Excise Duty -Net impact of Excise Duty on Closing Stock -SUB TOTAL (D) -
E. PROVISIONS (Refer detail below at Sl 2) 1900.82TOTAL (A+B+C+D+E) 78964.61
(` in lakh)PARTICULARS For the year ended
31st March, 2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-236
165
Note No 35 OTHER EXPENSES (Contd.)Explanatory Note: -
1) Detail of Audit Expenses are as under: -i) Statutory Auditors
- Statutory Audit Fees 11.15- Tax Audit Fees 0.89 -In Other Capacity 8.65- Reimbursement of Expenses 5.81 26.50
ii) Cost Auditors- Cost Audit Fees 0.61- Reimbursement of Expenses 0.86 1.47
iii) Internal Auditors- Audit Fees 0.65- Reimbursement of expenses 1.66 2.31TOTAL 30.28
2) Detail of Provisions are as under: -Doubtful debts -Doubtful advances / deposits 9.82Prov. For Obsolete /Non-moving Stores 108.71Prov. For Discrepency of Stores & Spares -Prov. For Capital Work in Progress 695.58Prov. For Assets 631.54Interest on MSMED 291.03Provision for Mine Closure Expenditure 163.00Provision for Others 1.14TOTAL 1900.82
Note No 36 TAX EXPENSECURRENT TAXIncome Tax Provision 8656.75Income Tax relating to earlier years 472.18Deferred Tax Account (667.91)TOTAL 8461.02
Note No 37 OTHER COMPREHENSIVE INCOMEA(i) Items that will not be reclassified to Profit/Loss
Acturial gain/loss recognised in the year for employees : Gratuity (1676.21)TOTAL (A(i)) (1676.21)
A(ii) Income Tax relating to items that will not be reclassified to Profit & Loss -TOTAL (A(ii)) -
B(i) Items that will be reclassified to Profit/LossTOTAL (B(i)) -
B(ii) Income Tax relating to items that will be reclassified to Profit & LossTOTAL (B(ii)) -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
(` in lakh)PARTICULARS For the year ended
31st March, 2019
F-237
166
38 GENERAL NOTES ON ACCOUNTS
1. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)
(i) Contingent Liabilities: -
a. Claims against the Group not acknowledged as debt : 2018-19(` in lakh)
i. Disputed VAT / CST / Entry Tax 3347.51ii. Disputed Excise Duty 5747.41iii. Disputed Income Tax / Provident Fund 11101.54iv. Other Demand 34578.47SUB-TOTAL (A) 54774.93
b. Other money for which the Group is contingently liable :i. Bank Guarantee 2585.42ii Letter of Credit 1894.47iii Bill discounting 6636.44SUB-TOTAL (B) 11116.33GRAND TOTAL (A+B) 65891.26
(ii) Commitments:-Estimated amount of contracts remaining to be 86661.55executed on capital account and not provided for(Net of advance and deposit)
Details of Claims against the Group not acknowledged as debt (of 1(i)(a) above)
VAT/CST/ENTRY TAXThere are demand notices totaling to Gross Demand of ` 3347.51 lakh from various State Revenue Authorities regardingVAT/CST/Entry Tax against which the company has deposited under protest of ` 610.33 lakh. The Group is contestingthe demand and the management as well as the legal advisors/consultants are of the opinion that its contention willlikely to be upheld by the Appellate Authorities. The Group also believes that ultimate outcome of these proceedings willnot have a material adverse impact on the financial position of the Group.EXCISE DUTYThere are demand notices totaling to Gross Demand of ` 5747.41 lakh from Central Excise Authorities regarding ExciseDuty against which the company has deposited under protest of ` 30.34 lakh. The Group is contesting the demand andthe management as well as the legal advisors/consultants are of the opinion that its contention will likely to be upheld bythe Appellate Authorities. The Group also believes that ultimate outcome of these proceedings will not have a materialadverse impact on the financial position of the Group.INCOME TAX & PROVIDENT FUNDThere are Income Tax & Provident Fund demand notices totaling to Gross Demand of 11101.54 lakh against which thecompany has deposited under protest of ` 72.31 lakh. The Group is contesting the said demands before the High Courtand Appellate Authorities. The management as well as the income tax /provident fund consultant are of the opinion thatits contention will likely to be upheld by the Appellate Authorities. The Group also believes that ultimate outcome ofthese proceedings will not have a material adverse impact on the financial position of the Group.OTHER DEMAND of ` ` ` ` ` 34578.47 lakhThe major pending litigation cases are as follows:a. The Municipal Council, Malanjkhand, raised a demand on Malanjkhand Copper Project (MCP) amounting to 7046.64
lakh on account of penalty on Terminal Tax for the periods from financial year 2000-01 to 2005-06 on the ground ofshort payment of Terminal Tax by adopting higher assessable value as well as higher of Metal in Ore (MIO) producedand Metal in Concentrate (MIC) despatched. The matter was contested by the Group before the Hon'ble High Court,Jabalpur, M.P. and the Group paid ` 352.33 lakh towards penalty Terminal Tax as per the order of Hon'ble HighCourt, Jabalpur, M.P. Subsequently the matter was turned down by the Hon'ble High Court, Jabalpur, M.P. TheGroup filed writ petition before the Hon'ble Supreme Court of India. The Hon'ble Supreme Court vide its order dated29.07.2011 directed the Group to deposit an ad-hoc amount of ` 1000.00 lakh to Municipal Council, Malanjkhand
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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which has since been deposited by the Group and shown as 'Deposits with Court' and also ordered that the matter maybe heard on the ground of merit by the Civil Court, Baihar. Further a demand of ` 18867.56 lakh for the periods from2006-07 to 2011-12 was also raised on the above ground for which the appeal by the Group is pending before theHon'ble Supreme Court. Pending final decision, the full amount of 25914.20 lakh has been disclosed under 'ContingentLiability'.
b. The Municipal Council, Malanjkhand, Madhya Pradesh issued demands on MCP for ` 558.24 lakh on account ofProperty Tax for several years against which the Group filed writ petitions before the Hon'ble Madhya Pradesh HighCourt, Jabalpur challenging the demand notice. The amount of ` 558.24 lakh has been included under 'ContingentLiability'.
c. There was a trade dispute with M/s Bhagawati Gases Ltd (BGL) in connection with an agreement to supply of gaseousoxygen at Khetri Copper Complex. The dispute was referred to Arbitration. The claim of BGL is for an amount of` 1079.80 lakh with a corresponding counter claim of 534.62 lakh by the Group. The arbitral award went against theGroup. The Group had filed an appeal before the Hon'ble High Court of Rajasthan and the same was admitted forhearing. The Group preferred appeal before the Hon'ble Rajasthan High Court regarding interim deposit of arbitralaward pending disposal of original appeal, but the same was dismissed. Thereafter the Group had preferred appealbefore Hon'ble Supreme Court and the Hon'ble Supreme Court passed the order directing the Group to deposit theentire decrial amount along with interest amounting to ` 1733.50 lakh in the form of Fixed Deposit. The Groupdeposited the said amount and shown the same as Deposit in Current assets. Pending decision of the original appealagainst arbitral award before the Hon'ble Rajasthan High Court, the said amount of 1733.50 lakh has been disclosedunder 'Contingent Liability'.
d. There was a demand from M/s Uttkal Moulders amounting to ` 1662.72 lakh regarding interest for delayed paymentagainst supply of grinding media balls at Malanjkhand Copper Project. The case is pending before the Sole Arbitrator.Pending final decision, the said amount of ` 1662.72 lakh has been disclosed under 'Contingent Liability'.
e. In addition there are number of pending litigation cases against the Group claiming demand of ` 4709.81 lakh byretired employees, third parties etc. which the Group is contesting before different Legal Forums / Courts.
The management as well as the legal advisors/consultants are of the opinion that its position will likely to be upheld inthe appellate proceedings. The Group also believes that ultimate outcome of these proceedings will not have a materialadverse impact on the financial position of the Group.2. During the year, the Group has made a provision amounting to ` 1145.00 lakh in terms of DPE guidelines towards
Performance Related Pay payable to the executives for F.Y. 2018-19 which is shown under 'Employees' BenefitExpenses'.
3. Lease premium paid for land for mining purposes including payment for Net Present Value (NPV) of forest area paidto forest department is capitalized under the head Prepaid Expenses shown under Note No. 9(d) & 16(g).
4. At Indian Copper Complex (ICC) certain freehold lands acquired through nationalization in accordance with IndianCopper Corporation (Acquisition of Undertaking) Act, 1972, for which title deeds, conveyance deeds etc. are not in thepossession of the group. The lease agreements of Kendadih, Rakha and Surda Mining Lease at ICC with the StateGovernment has been renewed in respect of leasehold lands valid upto 31.03.2020.
5. The commercial operation of Smelter, Refinery and Sulphuric Acid Plant at Khetri Copper Complex (KCC) weresuspended since December 2008. The Group suffered loss on account of impairment of the said plants valued by anindependent consultant and consequently a total sum of ` 464.01 lakh was provided in the accounts for impairmentloss in compliance with the guidelines of IND AS 36 on "Impairment of Assets" as on 31.03.2019. Total inventoryvalued ` 33.21 lakh after provision of ` 4.55 lakh which remained as process material in the above Plant is includedin the Inventory of the Group. The management is of the opinion that such inventories consisting mainly of metalcontent and having realizable value at least equal to the amount at which they are stated.
6. The title deeds in respect of office flat at SCOPE Complex, Delhi & Jaipur office with total book value of ` 58.47 lakhare yet to be executed. Further, the title deeds for Freehold and Leasehold Land and Building acquired in respect ofGujarat Copper Project (GCP) with book value of ` 5859.97 lakh are yet to be executed.
7. At ICC, Pollution Control Plant under Package I & III amounting to ` 2100.50 lakh have not been capitalized forwant of completion of trial / guarantee run as per terms of contract. As a matter of prudence, full provision for thesame has been made in the accounts to take care of efflux of time over the years.
8. Confirmation letters of majority of balances under the heads Sundry Creditors, Claims Recoverable, Loans & Advances,Sundry Debtors and Deposits from and with various parties/ Government Departments have been sent but in numberof cases such confirmation letters from the parties are yet to be received.
9. Like last year, considering the present scenario of MCP mines and to sustain the planned production, managementduring the year also decided to process the lean ore along with the normal ore produced from the mine. At the end ofthe year, the value of closing lean ore was ` 2321.95 lakh. The physical verification of lean ore has been conducted bythe Malanjkhand Mining Department.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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10. During the year, the Group has spent a sum of ` 208.16 lakh on account of Corporate Social Responsibility (CSR)expenses out of which ` 185.38 lakh is charged to Statement of Profit & Loss and the balance amount of ` 22.78 lakhhas been utilized out of unspent balance of CSR Fund.
Amount spent during the year on:
Sl. Particulars in cash In cash Yet to be paid TotalNo.(i) Construction/acquisition of any asset - - -(ii) On purposes other than (i)above ` 208.16 lakh - ` 208.16 lakh
11. Information related to Micro, Small and Medium Enterprises Development Act, 2006 is disclosed hereunder:
a) i) Principal amount remaining unpaid to any supplier at the ` 535.45 lakhend of the financial year
ii) Interest due on above ` 182.18 lakh
b) Amount of interest paid by the buyer in terms of Section 16 ` 0.36 lakhof the Act, along with amount of payment made beyond theappointed date during the year
c) Amount of interest due and payable for the period of delay in ` 737.00 lakhmaking payment (which have been paid but beyond the duedate during the year) but without adding the interest specifiedunder the Act
d) Amount of interest accrued and remaining unpaid at the endof the financial year ` 919.18 lakh
e) Amount of further interest remaining due and payable even in NILthe succeeding years, until such date when the interest duesas above are actually paid to the Small enterprise, for thepurpose of disallowance as a deductible expenditure underSection 23 of the Act `
The information has been given of such vendors to the extent they could be identified as "Micro and Small" enterpriseson the basis of information available to the Group.12. Consequent to the decision of the Hon'ble Supreme Court vide its order dated 10.11.2016 in favour of the Group in
respect of appeal filed, a total amount of 12315.10 lakh is receivable from M.P. State Electricity Board (now renamedas MPVVNL) on account of excess charge of electricity bills paid in earlier periods. However, on conservative basis,against such excess charge of electricity bills receivable, the Group has taken the balance credit of ` 2795.78 lakh onthe basis of adjustment against bills raised by MPVVNL during the year 2018-19.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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Excess provision on account of shortage,non-moving, obsolete and insurance Stores& Spares written back in respect of MCP -` 25.03 lakh & KCC - ` 1.90 lakh
Excess provision for doubtful debts & claimsno longer required is written back in TCP -` 7.70 lakh, RSOW - ` 8.83 lakh & KCC -`0.03 lakh
Excess provision for discarded assets nolonger required is written back in KCC -` 0.63 lakh, RSOW - ` 0.42 lakh & ICC -` 0.11 lakh
Excess provision created for MP RuralInfrastructure & Road Development Tax nolonger required in MCP
Excess provision for interest on MSME iswritten back in KCC - ` 70.67 lakh & MCP- ` 99.27 lakh
Excess provision created for Water Bill iswritten back at MCP
Liability for unclaimed EMD, SD & SundryCreditors for more than 5 years writtenback at ICC - 262.82 lakh & HO - 213.62lakh
Excess provision for CSR created in earlieryears is written back in ICC - ` 21.34 lakh& HO - ` 9.25 lakh
Excess liability created during the earlieryears in HO
Total
Consequent to physical verification conducted andon reconciliation with book records during the year,the excess provision at the end of the year has beenwritten back to revenue.
The relevant amount of debts and claims wererecovered from the customers/parties and hence theprovision for doubtful debts & claims created inearlier years has been written back.
Sale of assets during the year for which provisionalready existed has been written back.
The excess provision for MP Rural Infrastructure &Road Development Tax has been written back
Excess provision for interest on MSME created inearlier years has been written back.
The excess provision for Water Bill has been writtenback
The unclaimed liability for EMD, SD & SundryCreditors unmoved for more than 5 years has beenwritten back
Excess provision for CSR created in earlier yearshas been written back.
The excess liability created in earlier years has beenwritten back.
Sl. No. PARTICULARS ` in lakh REASONS FOR REVERSAL
1.
2.
3.
4.
5.
6.
7.
8.
9.
26.93
16.56
1.16
316.76
169.94
54.02
476.44
30.59
2.89
1095.29
14. No fraud by the Group or any fraud on the Group by its officers and employees has been noticed or reported duringthe current financial year.
13. During the year the Group has written back old liabilities / provisions amounting to ` 1095.29 lakh in the accounts,the details of which are as under :-
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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Pending fulfillment of conditions as set out in paragraphs 6 to 8 of IND AS 105 "Non-current Assets Held for Sale andDiscontinued Operations" the aforesaid assets held under disposal group and inadvertently shown as "Non-current AssetsHeld for Sale" for the previous year has now been re-classified under Discarded Assets category and shown in Note No.3B of the financial statements.
16. Since the Group is primarily engaged in the business of manufacture and sale of copper products, the same is consideredto be the only primary reportable business segment and accordingly has been reported. As the Group operatespredominantly within the geographical limits of India, no secondary segment reporting has been considered as perIND AS 108 "Operating Segments".
17. Sales for the period include FOB value of Export Sales:-
15. The Group has closed / suspended many of its mining operations located at various places, Fertilizer Plant at Khetriin different years due to their uneconomic operations. As per requirement of IND AS 105 on "Non-current AssetsHeld for Sale and Discontinued Operations" the following information for the year are furnished:
2018-19Qty (MT) ` ` ` ` ` in lakh
Anode Slime 19.800 2004.64Copper Reverts 670.934 2027.10Copper Concentrate (CMT) 19571.433 80235.59Total 84267.33
(` in lakh)
MSB GROUP OFMINES
RCP CCP DCP Fertilizer Plant
i) Initial disclosure event (Yearof closure)
1997 to 2003 2001 2002 1994 2001
ii) Carrying amount of Assets No separater e c o r d smaintained
503.89 – – No separaterecordsmaintainediii) Liabilities to be settled 137.17 73.04 3.38
iv) Amount of income – – – –
v) Amount of expenses – 34.70* ––
vi) Gain on sale of assets (Included in iv above)
– – – –
* This is included in cash generated from operations in the Cash Flow Statement.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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The remuneration of key Management personnel are gives below:
Particulars Key Management Personnel Total Remuneration (` in lakh)
FY 2018-19
A. FUNCTIONAL DIRECTORS
Receivingof Services
1. Sri Santosh Sharma 66.45Chairman-cum-Managing Director
2. Sri K D Diwan 21.11Chairman-cum-Managing Director (Arrear Gratuity & PRP)
3. Sri Anupam Anand 59.01Director (Personnel)
4. Sri S K Bhattacharya 49.03Director (Mining)
5. Sri S K Bandyopadhyay 32.55Director (Finance) (Part of the year)
6. Sri Arun Kumar Shukla 21.92Director (Operations) (Part of the year)
7. Sri C S Singhi 43.80Company Secretary
OTHER THAN FUNCTIONAL DIRECTORS
Sl. No. Payment to Independent Directors FY 2018-19
1. Sitting Fees 10.35
Sl. No. Particulars As on 31.03.20191. Amount payable Nil2. Amount receivable Nil
18. In terms of IND AS 24 on "Related Party Disclosures":The Holding Company does not have any Advances provided to its Subsidiary as at the year-end except as is disclosedbelow:Transactions with Related Party
Name of Nature of Type of Year ended Related Party Relationship Transaction 31.03.19
Chhattisgarh Subsidiary Investment in 18.50Copper Limited shares as on
Advances given as on 6.50
(` in lakh)
Balance Outstanding with Key Managerial Personnel as on 31.03.2019
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
(` in lakh)
INDEPENDENT DIRECTORS
Smt Simantini Jena - Date of appointment - 17.11.2015 & Re-appointed on 17.11.2018
Sri Hemant Mehtani - Date of appointment - 17.11.2015 & Re-appointed on 17.11.2018
Sri D R S Chaudhary - Date of appointment - 01.12.2015 & Re-appointed on 01.12.2018
Sri Subhash Sharma - Date of appointment - 18.02.2018
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19. In terms of IND AS 33 on "Earning per Share" :
BASIC DILUTED
Profit After Tax 14526.26 14526.26
Denominator used: Weighted average number of Equity 925218000 925218000Shares of `5/- (Previous year `5/- each) outstanding during theperiod.
Earning Per Share (`) 1.570 1.570
(`in lakh)
20. The Group has accounted for Deferred Tax in accordance with the guidelines of IND AS 12 on "Income Taxes" issuedby The Institute of Chartered Accountants of India. The Deferred tax balances are set out below:-
DEFERRED TAX ASSET (NET): -
Deferred Tax Asset :-
Difference between provision made 8780.81 - 463.09 9243.90in accounts and claims madeas per I. T Act
8780.81 - 463.09 9243.90Deferred Tax Liability :-
Difference between net book value of (3203.10) - 204.82 (2998.28)depreciable capital assets vis-a-visWDV as per IT Act
Adjustment for fair value of Investment - - - -
(3203.10) - 204.82 (2998.28)
Deferred Tax Asset (Net) 5577.71 - 667.91 6245.62
Deferred TaxAsset/ (Liability)as at 01.04.2018
Adjustments Credit/ (Charge)during2018-19
Deferred TaxAsset/ (Liability)as at 31.03.2019
Particulars
21. PROVISIONS FOR CONTINGENCIES: -
Carrying amount as at 01.04.2018 743.11 3392.91 4664.86 17960.47 26761.35
Amount provided during the year 1096.26 695.58 - 7124.04 8915.88
Amounts utilized against provision 0.81 - - 8682.38 8683.19
Unused amounts released during the year. - - - - -
Carrying amount as at 31.03.2019 1838.56 4088.49 4664.86 16402.13 26994.04
DiscardedFixedAssets
CapitalWIP &Advance
MinesDevelopmentExpenditure
Others Total
(`in lakh)
(`in lakh)
22. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS IN TERMS OF Ind AS 19 :The Group has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets agratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is fundedthrough Life Insurance Corporation of India, SBI Life Insurance Co. Ltd. and India First Life Insurance and are managedby separate trust. During the year, the Group has also funded through Life Insurance Corporation of India and SBI LifeInsurance Co. Ltd towards leave encashment. Expenses recognized in Statement of Profit & Loss, Other ComprehensiveIncome and Mine Development Expenditure amounting to ` 4732.36 lakh in respect of Gratuity, Leave Encashment andLeave Travel Concession which have been provided for as stated below.
Particulars
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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Present Value of obligation as on last valuation 16287.25 12671.78 139.11Current service cost 826.82 995.51 –Interest cost 960.87 820.94 –Total Actuarial gain/loss 1676.21 1265.18 127.25Benefits Paid 6249.25 2852.24 94.43Present value of obligation as on valuation date 13501.90 12901.17 171.93
(ii) Changes in Fair Value of Plan AssetsFair value of Plan Assets at Beginning of period 23543.84 2911.19Interest Income 1716.93 223.48Employer Contributions 2800.00 3051.84Benefits paid 6249.25 2852.24Return on Plan Assets excluding Interest Income – –Fair value of Plan Assets at End of measurement period 21811.52 3334.27
(iii) Table Showing Reconciliation to Balance SheetFunded Status 8309.62 (9566.90)Fund Asset 21811.52 3334.27Fund Liability 13501.90 12901.17
(iv) Expenses recognized in the Statement of Profit and Loss AccountCurrent service cost 826.82 995.51Net Interest cost (756.06) 597.45Actuarial (gain)/loss – 1265.18 127.25Benefit Cost (Expense Recognized in Statement of Profit/loss) 70.76 2858.14 127.25
(v) Other Comprehensive IncomeTotal Actuarial (gain)/loss 1676.21 –Return on Plan Asset, Excluding Interest Income – –Balance at the end of the Period 1676.21 –Net (Income)/Expense for the Period Recognized in OCI 1676.21
(vi) Table Showing Plan AssumptionsDiscount Rate 7.30% p.a. 7.30% p.a. 7.30% p.a.Expected Return on Plan Asset 8.00%,7.50%,7.27% 8.00%, 7.50% –Rate of Compensation Increase (Salary Inflation) 6.00% p.a. 6.00% p.a.Average expected future service (Remaining working Life) 8 years 8 years 8 yearsMortality Table IALM 2006-2008 IALM 2006-2008 IALM 2006-2008
ULTIMATE ULTIMATE ULTIMATESuperannuation at age-Male 60 Years 60 Years 60 YearsSuperannuation at age-Female 60 Years 60 Years 60 YearsEarly Retirement & Disablement (All Causes Combined) 1% p.a. 1% p.a. 1% p.a.
LeaveEncashment(Partiallyfunded Plan)
Gratuity(Funded plan)
Leave TravelConcession(Non-fundedPlan)
The following tables summarize the components of net benefit expense recognized in the Statement of Profit and Loss,Other Comprehensive Income and Mine Development Expenditure and the funded status and amounts recognized in thebalance sheet for the respective plans. (`in lakh)
(i) Changes in Present Value of Obligation
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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The details of the plan assets as on 31.03.2019 towards gratuity & leave encashment are as follows:
Investment in Life Insurance Corporation of India 2580.64
Investment in SBI Life Insurance Co. Ltd 20448.28Investment in India First Life Insurance 700.31Fund with Gratuity Trust Savings Bank Accounts 1416.56
Total 25145.79
Actual Return on Plan Assets during the year - ` 1940.41 lakh.
The estimates of future salary increases were considered in actuarial valuation after taking into account inflation, seniority,promotion and other relevant factors. Further, the expected return on plan assets is determined considering severalapplicable factors mainly the composition of plan assets held, assessed risk of asset management and historical returnsfrom plan assets.
23. The physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally inall the units at the end of the current year by a duly approved committee. Also, physical stock verification of WIP andFinished Goods is undertaken by an independent agency in all the units at the end of the financial year under review.In respect of stores and spares, physical verification has been conducted by the external agencies once during theyear. Shortages/ (Excesses) identified on such physical verification have been duly adjusted in the books of accounts.
24. The physical verification of fixed assets which is required to be conducted every year so that all the units/offices arecovered once in a block of three years interval. Physical verification of fixed assets has been conducted by externalagencies in ICC, RCP, MCP, GCP, Bangalore Sales Office & H.O. during FY 2016-17, in KCC & Delhi Sales Office in2017-18 and TCP & Mumbai Sales Office during the year. Shortages/(Excesses) identified on such physical verificationhave been duly adjusted in the books of accounts.
25. As per Ind As requirement, Mine Closure Expenditure is assessed to provide reliable and more relevant information.Accordingly Accounting Policy No. 2.14 has been modified and consequently profit of the Group is reduced by` 163.00 lakh which includes past as well as current period expenses. However, the other changes in SignificantAccounting Policies relating to Property, Plant & Equipment, Intangible Assets, Inventory etc are made to providereliable and more relevant information without any financial impact on the accounts of the Group.
(`in lakh)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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26. Financial Instrument
1. Derivatives not designated as hedging instruments
The Group uses Commodity Futures Contracts to manage its commodity price risk . The Commodity Futures Contractsare not designated as hedging instrumnets and are entered into for periods consistent with commodity price risk exposureof the underlying transactions, generally from one to four months.
The Group uses foreign exchange forward contracts to manage some of its transaction exposures. The foreign exchangeforward contracts are not designated as cash flow hedges and are entered into for periods consistent with foreign currencyexposure of the underlying transactions, generally from one to four months.
Commodity price risk
The Group purchases copper blister/ anode on an ongoing basis for its operating activities in its Gujarat Copper Projectplant for the production of cathode. To hedge itself against the volatility in LME copper prices in the internationalmarket has led to the decision to enter into commodity future contracts.
These contracts, which commenced in August 2016, are expected to reduce the volatility attributable to price fluctuationsof copper. Hedging the price volatility of copper purchases is in accordance with the Rsk Management Policy approved bythe Board of Directors. The hedging relationships are for a period between 1 and 4 months based on existing purchaseagreements. The Group designated only the spot-to-spot movement of the entire commodity purchase price as the hedgedrisk. It has been decided by the company not to follow the hedge accounting for these instruments.
As at 31 March 2019, the fair value of the open position of commodity future contracts is nil.
2 . Financial Instruments by Categories
The carrying value and fair value of financial instruments by categories were as follows:
Set out below, is a comparison by class of the carrying amounts and fair value of the Group’s financial instruments, otherthan those with carrying amounts that are reasonable approximations of fair values:
Particulars Total carrying value Fair Value as atas at March 31, 2019 March 31, 2019
Financial Assets at FV through Statement of Profit & Loss
Mutual Funds 7.84 8.85
Derivatives not designated as hedges
Future Contract Receivable on commodity - -
Total of Financial Assets 7.84 8.85
Financial Liabilities
Derivatives not designated as hedges
Forward Cover Contract Liability - -
Total of Financial Liabilities - -
(Amount in ` lakh)
3. The Management considers the Service fees of `15 lakh paid on the Exim Bank Term loan amounting to ` 30000 lakhdrawn on 29.05.2018 as immaterial, as the amount of service fee was only 0.009% of the Turnover (FY 2018-19) of theGroup and hence the same was not considered as a transaction cost in terms of fair valuation at initial recognition underINDAS 109. Further, the Management assessed that for the purpose of IND AS 109, the carrying value of loan is consideredas its fair value as no loan could be provided at a rate lower than the rate of interest of Exim Bank loan for similar termsand conditions of the loan at that point of time.
Similarly, the Management considers the total of Upfront fees & Other charges of ` 245.33 lakh paid on the SBI ECBloan amounting to ` 17734.75 lakh drawn during July 2018 to January 2019 as immaterial, as the amount of such fees/charges was only 0.140% of the Turnover (FY 2018-19) of the company and hence the same was not considered as a
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further, the Management assessedthat for the purpose of IND AS 109, the carrying value of loan is considered as its fair value as no loan could be providedat a rate lower that the rate of interest of SBI ECB loan for similar terms and conditions of the loan at that point of time.
The Management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts and othercurrent liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchangedin a current transaction between willing parties, other than in a forced or liquidation sale. The following methods andassumptions were used to estimate the fair values:
The Group enters into derivative financial instruments with various counterparties, principally with financial institutionshaving Investment grade credit ratings. Foreign exchange forward contracts and commodity futures contracts are valuedusing valuation techniques, which employs the use of market observable inputs. The most frequently applied valuationtechniques include forward pricing .
4. Fair Value Hierarchy
Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) in active markets.
Level 2 - Level 2 hierarchy includes financial instruments measured using inputs other than quoted prices includedwithin Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e.derived from prices).
Level 3 - Level 3 hierarchy includes financial instruments measured using inputs that are not based on observablemarket data (unobservable inputs).
The following table presents fair value hierarchy of assets and liabilities measured at fair value.
(` in lakh)
5. Financial Risk Management
Financial risk factors
The Company's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company'sprimary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on itsfinancial performance.
Particulars Date of Valuation Level 1 Level 2 Level 3 Total
Financial Assets at FV through Statementof Profit & Loss
Non-derivative financial assets
Mutual funds 31/Mar/2019 8.85 - - 8.85
Derivative financial assets
Future Contract Receivable on commodity 31/Mar/2019 - - - -
Liabilities measured at fair value:“Derivative financial liabilities”
Forward Cover Contract Liability 31/Mar/2019 - - - -
Assets measured at FV through OCI 31/Mar/2019 - - - -
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
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Risk Exposure arising from Measurement Management
Market risk- Future commercial Sensitivity analysis Forward foreignForeign Exchange transactions, Recognised exchange contracts
financial assets and financial liabilities
Market-Commodity Purchase of Copper Price Sensitivity Commodity FuturesPrice Risk Contract
Credit risk Trade receivables Ageing analysis Sales are mainly doneagainst Advance or Letters of Credit
Liquidity risk Borrowings and other Rolling cash flow forecasts Cash flow managementliabilities
a) Market Risk
i) Foreign Currency Risk
The Group operates at international level which exposes the company to foreign currency risk arising from foriegncurrency transaction primarily from Imports and foreign currency borrowing. Foreign currency risk arises from futurecommercial transactions and recognised assets and liabilities denominated in a currency other than INR as on reportingdate.
(As of March 31, 2019 )
Particulars ` In lakh
Cash & cash equivalents -
Trade Payables -
Loans 68,007.12
Others (if any) -
Net Assets/ (-) Liabilities (-) 68,007.12
Sensitivity
The sensitivity of profit or loss to changes in exchange rate arises mainly from foreign currency denominated financialinstrument.
Particulars Impact on profit before taxMarch 31, 2019
Increase by 5% (3400.36)
Decrease by 5 % 3400.36
ii) Commodity Price Risk
The Group's exposure to security price from copper price fluctuation in international market does not arise as thecompany hedges all its imports through Future contracts at LME.
b) Credit Risk
Credit risk refers to the risk of default on its obligation by the Debtors resulting in a financial loss. The company sellsmajority of its products either against Advance from Customers or Letters of Credit. Accordingly, credit risk from Tradereceivables has not been cosidered as credit risk.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-249
178
Customer credit risk is managed by each business unit subject to the Group's established Marketing policy, proceduresand control relating to customer credit risk management. Outstanding customer receivables are regularly monitored andany shipments to major customers are generally covered by letters of credit or other forms of credit insurance.The maximum exposure to credit risk at the reporting date is ` 942.77 lakh for which full provision has been made in theaccounts as disclosed in Note No 12.Other financial assetsCredit risk relating to cash and cash equivalents is considered negligible because our counterparties are scheduledbanks. We consider the credit quality of Term deposits with such banks as good as these banks are under the regulartoryframework of Reserve Bank of India. We review these banking relationships on an ongoing basis.c) Liquidity RiskOur liquidity needs are monitored on the basis of monthly and yearly projections. The company's principal sources ofliquidity are cash and cash equivalents, cash generated from operations.We manage our liquidity needs by continuously monitoring cash inflows and by maintaining adequate cash and cashequivalents. Net cash requirements are compared to available cash in order to determine any shortfall.Short term liquidity requirements consists mainly of Sundry creditors, Expense payable, Employee dues arising duringthe normal course of business as of each reporting date. We maintain a sufficient balance in cash and cash equivalents tomeet our short term liquidity requirements.The table below provides details regarding the contractual maturities of financial liabilities. The table has been drawnup based on the undisclosed cash flows of financial liabilities based on the earliest date on which the company can berequired to pay.
Credit risk exposure
An analysis of age of Trade receivables at each reporting date is summarized as follows: (` in lakh)
Particulars 31-Mar-19
Gross
Not past due -
Past due more than three months but not more than six months 29162.70
Past due more than six months but not more than one year 2247.62
More than one year 5687.28
Total 37097.60
Less Allowances for Bad & Doubtful Debts 942.77
Net Debtors 36154.83
6. Capital ManagementFor the purpose of the Group's capital management, capital includes issued equity capital and all other equity reserves attributableto the Group. The primary objective of the Group's capital management is to maximise the shareholder value.
(` ` ` ` ` in lakh as of March 31, 2019)
Particulars On Demand Less than 3 months 1-3 years 3-5 years 5-7 years Total 3 months to 1 year
Short term borrowings (cash credit) 16503.81 - - - - - 16503.81
Short term borrowings (Others) - 22702.84 - - - - 22702.84
Long Term Borrowings - 756.51 9982.04 32467.53 23147.58 1450.62 67804.28
Forex forward Contract - - - - - -
Total 16503.81 23459.35 9982.04 32467.53 23147.58 1450.62 107010.93
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-250
179
28. THE INCOME TAX EXPENSE FOR THE YEAR CAN BE RECONCILED TO THE ACCOUNTING PROFIT AS FOLLOWS :
Year ended 31.03.2019Profit / (Loss) before Tax 23009.85Income Tax expense calculated at 34.944% (34.608%) 8040.56Effect of Deferred Tax balances due to the change in income tax rates (60.05)Income Tax effect of earlier years 472.18Others (Net) 8.33Income Tax expense recognized in profit or loss 8461.02
(` in lakh)
29. DISCLOSURE OF INTEREST IN SUBSIDIARY
Name of Subsidiary Nature of relationship Proportion of shareholding Country of incorporation
Chhattisgarh Subsidiary 74% IndiaCopper Limited
30. During the year 65,000 equity shares of face value `10/- each have been issued to Chattisgarh Mineral DevelopmentCorporation Limited by Chattisgarh Copper Limited for providing consultancy services and no consideration hasbeen received in cash. This represents 26% of the share capital of Chhattisgarh Copper Limited.
31. The value of assets, other than fixed assets and non-current assets, have realizable value at least equal to theamount at which they are stated.
32. Gujarat Copper Project of the Group consists of three units namely, Anode Furnace (Smelter), Refinery and KaldoFurnace valuing 27214.50 lakh as at March 31,2019. The Anode Furnace and Refinery unit has been commissionedin October 2016 while Kaldo unit is yet to be commissioned. Since commissioning, the Anode Furnace and Refineryunits are being operated at a sub optimal level for want of feed stock. GCP being a secondary smelter, the feed stockare copper scrap, copper blister, liberator cathode etc. The Group has not been able to source these materials in therequired quantity resulting in suboptimal operations.The profit margin of GCP will essentially come from the operation of Kaldo furnace which has the ability to processall types of secondary copper material including scrap. The second phase of refurbishment at GCP includes Kaldofurnace, converter, slag granulation, ETP, etc. which is completed during the current FY 2018-19 and test run hasalso being successfully completed with the low quality raw material copper content as low as 30% copper which isgenerated internally in other units.Management is trying to make the project viable and exploring to source the scrap materials directly from the worldmarket. It is expected that scrap materials will be available during the FY 2019-20 to perform at the desired level.
33. The previous year's figures and comparative are not applicable, being first reporting period of consolidated financialstatements.
27. INTEREST IN OTHER ENTITIES
SUBSIDIARYThe Group's Subsidiary at 31.03.2019 is set out below:Unless otherwise stated, Subsidiary has Share Capital consisting solely of Equity Shares that are held directly bythe Group and the proportion of ownership interests held equals the voting rights held by the Group. The country ofincorporation or registration is also its principal place of business.
Name of Entity Place of business / Ownership interest Ownership held byCountry of incorporation held by the Group non-controlling interests
31.03.19 31.03.19
Chhattisgarh Copper Limited India 74% 26%
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-251
180
38.G
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F-252
181
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
38.G
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F-253
182
Quantity Value
Year ended Year ended2018-2019 2018-2019
CMT (` in lakh)
Concentrate own production 14549 33438.35Concentrate excluding own production - -Cathode - -
38.3 Imported and indigenous raw materials, storesspare parts and components consumed ( as certified by the management )
RAW MATERIALS: %Imported 91.58 5741.43Indigenous 8.42 528.14
100.00 6269.57
STORES & SPARES:(Direct and Stores & Sparesbooked in Mine Development, %Shut-down and Fuel)Imported 4.14 882.50Indigenous 95.86 20448.64
100.00 21331.1438.4 C.I.F. value of imports
Raw Material 5741.43Components, spare parts and stores 1444.00
7185.4338.5 Expenditure in foreign currency
Travelling 85.64Others 7185.52
7271.1638.6 Earning in foreign Exchange
Export of Goods (FOB) 84267.33
84267.3338.7 Payment to Whole Time Directors
Salaries and allowances 186.11Company's contribution to provident and other funds 13.99Re-imbursement of Medical expenses 0.53Leave Encashment 13.23Gratuity 10.00Other Benefits 26.21
250.07
38. GENERAL NOTES ON ACCOUNTS (Contd.)Additional information forming part of accounts for year ended March 31, 2019 38.2 Raw materials consumed
Note :In addition, the Whole Time Directors are allowed the use of company car for private purpose and have been providedwith residential accomodation as per terms of their appointment/Government guidelines.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd.)
F-254
(1) revrtlIell *1117
HINDUSTAN COPPER LIMITED www.hindustancopper.com
CIN : L27201VVB1967001028825
55f; alart
*Magi*
71111
1179' ti trot ffiT A GOVT. OF INDIA ENTERPRISE
No. HCL/SCY/SE/ 2016
7.4.2021
The Sr. General Manager The Vice President
Dept. of Corporate Services
Listing Department HE Limited
National Stock Exchange of India Ltd Phiroze Jeejeebhoy Towers Exchange Plaza, C-1, Block G
Dalai Street
Bandra-Kurla Complex, Bandra(East) Mumbai 400 001
Mumbai 400 051 BSE Scrip Code: 513599
NSE Symbol: HINDCOPPER
Sub: Approval of the Condensed Interim Unaudited Financial Statements (Standalone and Consolidated) for the nine months period ended December 31, 2020
Sir/ Madam,
We wish to inform you that the Board of Directors of the Company at its meeting held today i.e. April 7, 2021 has, inter alia, considered and approved the condensed interim unaudited financial statements (Standalone and Consolidated) as of and for the nine months period ended December 31, 2020 comprising the Balance Sheet as at December 31, 2020, Profit and Loss Account, Statement of other comprehensive income, Statement of Cash Flows and Statement of Changes in Equity for the nine months ended December 31, 2020, along with the notes thereto (the "Condensed Financial Information") and the Limited Review Report of the Statutory Auditors of the Company thereon for special purpose.
The Condensed Financial Information are annexed herewith and have been made available on the website of the Company at www.hindustancopper.com.
Further, the Condensed Financial Information as mentioned above are being issued on a one time basis only and should not be considered as (a) any practice for disclosure of financial information that will be followed by the Company going forward; and (b) being made under Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended.
The meeting of the Board commenced at 9:30 AM and concluded at 0 ; .3/3 AM.
We request you to take the above on record and the same be treated as compliance under the applicable provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended.
Thanking you, Yours faithfully,
(C S Singhi) ED (Co Secretary)
Encl. As stated
Tkifu 3115iF chief fog : ,ausialg tflM4Y ttii Ai:1.10224,0 evvi -700 019 Registered & Head Office : Tamra Bhavan, 1, Ashutosh Chowdhury Avenue, P.B. NO. 10224, Kolicata-700 019
cruet Tel : 2283-2226 (Hunting), e50Sci Fax : (033) 2283-2478/2640, taka. E-mail : hol_hoOhindustancopper.com F-359
CHATURVEDI & CO. CHARTERED ACCOUNTANTS
Park Centre, 14 Park Street, kolkata - 700 016. Phone: 2229 2229, 4601 2507
chaturvernol®hotrnail.coin: chaturvedisc573ataxi.co in (HO. Kolkata. Stanches : Delhi. Mtunbai. Chennai . LucknoWi
Report on Review of the Condensed Standalone Unaudited Interim Financial Statements
To The Board of Directors of Hindustan Copper Limited
Kolkata
Introduction
1) We have reviewed the accompanying Condensed Standalone Unaudited Balance Sheet of Hindustan Copper Limited (hereinafter referred to as "The Company") as on 31 December 2020 and the related Condensed Standalone Unaudited Profit and Loss Account, Condensed Standalone Unaudited Cash Flows Statement and Condensed Standalone Unaudited Statement of Changes in Equity of the Company for the nine months period then ended, and a summary of significant accounting policies and other respective select explanatory notes (hereinafter referred to as the "Condensed Standalone Unaudited Interim Financial
Statements").
2) The management of the Company is responsible for the preparation and fair presentation of these Condensed Standalone Unaudited Interim Financial Statements in accordance with the measurement and recognition principles of Indian Accounting Standard 34-"Interim Financial Reporting" prescribed under Section 133 of Companies Act, 2013 read with relevant rules issued there-under and other accounting principles generally accepted in India. The Condensed Standalone Unaudited Interim Financial Statements are the responsibility of the
Company's management and have been approved by the Board of Directors. Our
responsibility is to express a conclusion on this Condensed Standalone Unaudited Interim
Financial Statements based on our review.
Scope of Review 3) We conducted our review in accordance with the Standard on Review Engagements (SRE)
2410-"Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Institute of Chartered Accountants of India. A review of interim financial information consists of making inquiries, primarily of people responsible for financial and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on
Page 1 of 3
F-360
Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that can be identified in an audit. Accordingly, we do not
express an audit opinion.
Emphasis of Matter
4) Without qualifying our conclusion, we draw attention to the following matters:
a) Title deeds for freehold and leasehold land and building acquired in respect of Gujarat Copper Project (GCP) with book value of INR 5365.75 Lakh are yet to be executed in favour of the company. Title deeds for freehold and leasehold lands or other evidences of title in respect of lands at KCC,MCP and ICC as stated by the management is in the process of the reconciliation with financial records; and
b) Gujarat Copper project valuing INR 27559.37 Lakh where the project is not operating due to various constraints, viability assessment needs to be done to evaluate and
adjust for possible impairment loss, if any.
Our conclusion is not modified in respect of these matters.
Conclusion
5) Based on our review conducted as above, subject to limitation in scope as mentioned in paragraph 2 above, nothing has come to our attention that causes us to believe that the accompanying Condensed Standalone Unaudited Interim Financial Statements are not prepared, in all material respects, in accordance with the recognition and measurement principles of Indian Accounting Standard 34-"Interim Financial Reporting" prescribed under Section 133 of Companies Act, 2013 read with relevant rules issued there-under and other
accounting principles generally accepted in India.
Page 2 of 3
F-361
Restriction on Distribution and Use
6) This review report Is issued for the internal use of the Board or Directors of the Company for the purpose of inclusion in the Preliminary Placement Document and the Placement Document to be filed with the Securities and Exchange Board of India, Registrar of Companies and Stock Exchanges with regards to the proposed Qualified Institutional Placement of equity share of the Company as referred to in Note No.39 (30) of the Condensed Standalone Unaudited Interim Financial Statements and should not be used by any other person for any other purpose, We neither accept nor assume any duty or liability for any other purpose or to any other party to whom our report is shown or in whose hands It may come without our prior consent in writing.
For Chaturvedi & Co. Chartered Accountants Firm Registration No.:402137E
R.K. Honda
Partner hi No.:-510574
Place:-Koikata
Dated:- 01-444 Aril/ 2024-
1.016”- 21510 Stif AAA-AA1-6209
F-362
For and on behalf of the Board of Director,
Sather. Kumar Bandyopadhyay Men Kumar ShuMa
Company Seaetary
Directo (Finance) CFO
Chekmen and Managing Director & CEO
(6.4 No. FCS 2570)
( DIN :08173082)
(DIN : 03324672)
It
HINDUSTAN COPPER (BAITED
(A GOVT. OF INDIA ENTERPRISE)
Regd. Office : Tarnra Shawn I. Ashutosh Chowdhury Avenue, Kolkata -700 019.
GIN :L27201111,113106700I028825 CONDENSED INTERIM UNAUDITED STANDALONE BALANCE SHEET AS AT 31ST DECEMBER 2020
(T in lath)
PARTICULARS Note No.
Mat 31s1 December ,2020 (Unaudited) Reviewed
As at 31st March, 2020 (Aunkedl
ASSETS (1) NONCURRENT ASSETS (a) Property, Plant and Equipment 3A A 3B 38743.75 29423.55
09 Copan Work in Progress
(c) Financial Assets (i) investments
4
6
123814.15
58.55
123177.57
3.15
90 ahem 6 470.57 26.36
(d) Deferred Tax Assets (Net) 7 9153.18 5264.51
(a) Non-Carrion Tel Assets (Net) e 686.82 669.62
(1) Other Nan-Current Assets 8 45221.51 4928028
(2) CURRENT ASSETS
(e) Inventories 10 1067197 51982.72
119 Financial Arnett
(01mosiments 11 9.87 9.48
(i) Trade receivables 12 13118.69 8259.35
01) Cash end cash equivalents 13 2638.29 113431
Q1 Bank Balances other then above 14 15.58 452.52
(v1 Others 15 5215.12 2866.41
(c) Current Tea Assets (Net) 16 lasses 1545.39
00 Other current assets 17 40298.39 37524.43
Total Assets 300985.04 311905.55
EQUITY AND LIABILITIES
(1) Equity
(0) &Pity Share Caplet 18 46260.90 46260.90
03) Other Equity 19 84958.69 49765.59
Liabilities 1 NONCURRENT LIABILITIES (e) Mnancial liabilities
@ Borrowings 20 84731.11 6381753
(8) Other financial ilabiHes 21 843.53 84353
09 Provisions 22 8215.93 6585.93
(2) CURRENT LIABILITIES (a) Financial Habakies
(I) Bomovrings 23 42310.73 92749.96
(0 Trade Payables 24 1628120 23374.42
Oil Other financial liatailks 25 9068.11 855221
(b) Other current latikties 26 21087.72 18982.65
In Pm:anions 27 3396.12 3062.63
(d) Current Tar LlabiWes (Nell 28 3832.00
Total Equity er Ilabnilties 300966.04 31180
Corporate Inf emotion 1
Signifkarn Accounting Polkiee 2
General Notes on Accounts 39
The notes Marred to above form an Integral pan of the Financial Statements
As per our lenited review report of even date attached.
For Chaturyedld Co. Chartered Accountants
FRN 102137E
(CAR K NANDA ) Partner (M No. 510574)
Place : Hellcat+ Dated : , 0 4 , 2,021
F-363
HINDUSTAN COPPER LIMITED
(A GOVT. OF INDIA ENTERPRISE) Regd. Office: Tanya !Mayan 1. Ashutosh Chowdhury Avenue. Kefluta -700019.
CIN:1272011X131967001025125 CONDENSED INTERIM UNAUDITED STANDALONE STATEMENT OF PROFIT AND LOSS FOR THE NINE MONTHS ENDED 31st DECEMBER 2020
IT In lakh except EPS)
Partkula rs Note No.
Forth. Nine Months ended 31st December , 2020
(Unaudited) Reviewed
Forth. year ended 31st March. 2020 (Audited)
INCOME
1 Revenue from Operations 29 128452.05 83185.25
II Other Income 30 2553.83 589822
II Total Income (10) 129005.68 888111.47
N EXPENSES
Cost of Materials Consumed 31 181.07 e28.24
Charges In Inventories of Finished Goods.
Semi-Wished and Work-In-Process 32 32517.81 (5113.50)
Empisyves BeneM Expense 33 191621.98 25082.31
Finance Cost 34 5103.52 0041.89
Depreciation and Al1100111tien ExperlSe 35 20178.90 2e961.09
GeneralAdmInisaation & Other Egoenses 36 38377.19 86272.95
Total Expenses in)) 113960.47 142652.00
v PROFIT ((LOSS) BEFORE EXCEPTIONAL ITEMS AND TAX (II- 15045.21 153771.430 IV)
VI Exceptional items
VII PROFIT ((LOSS) BEFORE TAX IV.VII 1504511 ($3771.43)
VIII TAX EXPENSE 37
1) Current Tto 393200 842.15
2) Deferred Tat (3484.85) 2295,83
D( PROFIT 1(1055) FOR THE PERIOD FROM CONTINUING 14698.05 (56909.44) OPERATIONS AFTER TAX (VI-V0)
X Profit/(LoSS) from discontinued °Motion' (28.14) (34.70)
XI Tax expense of discontinued operalions (9.58) 18 73)
(v, PROFIT/MOSS) FROM DISCONTINUED OPERATIONS AFTER (19.56) (25.37) TAX IX .X.1)
XIII PROFIT ((LOSS) FOR THE PERIOD AFTER TAX 0%4%11) 1467850 ( 9 41)
XIV OTHER COMPREHENSIVE INCOME ((3.OSS) 39
An) tents that will not be reclassified to Froth / (Loss) (1500.00) 13000.95)
Income Tax relating to Xenia that will not be feClaSSITICI to A0)
377.52 755.29 Profit ft Loss)
OR items that will be reciassifkul to Profit / (Loss) income Tax relating to items that will be reclassified to
EXT) Profit ((Leas) TOTAL COMPREHENSIVE INCOME( 'LOSS) FOR THE
XV PERIOD 0111•XN) (Comprising Profitt(Loss) and Other Comprehensive Income 13556.02 (59181.08i faiths period )
XVI Earning pet mot( share (for continuing operations)
1 BASIC (T) 1.589 (6.151)
2 DILUTED 0) 1.539 (6.151)
VII Earring per egulty share ((or (iconinued OP Ts) 1 BASIC (T) 10.002) (0.003)
2 DILUTED (T) 10.002) (0.003)
Mt Earning per equity shore ((or discontinued & continuing operettas)
1 BASIC (7) 1.587 16.154)
2 DILUTED (T) 1.587 16.1541
Corporate Information Significant Accounting Policies
2
General Notes on ACCOLINS 39
The notes referred to above form an Integral part of the Financial Statiariards.
As per our limited review report of even date attached. i Farina on behalf oldie Board of DIfIld011
Ca- • cl/CAA"1/4"....46. Arun Kumar Shukla
Chairmen and Managing Difeeillf & CEO (DIN :03324672)
(CA R K NANDA I Panne, (M No.510574 )
Place : Monteith Dated: 07, 0 4 , 2-02-\
For Chaturvedi & Co. Chartered ACCOUntentti
FRN 302137E
CI Kumar BandyopadhyaY
Company Secretary DImdor (Finance) & CFO
(3d No. FCS 2570) ( DIN : 091738132)
F-364
6
Hindustan Copper Limited Condensed Interim Unaudited Standalone Statement of Changes in Equity for the period ended 31st December 2020
A . Equity Share Capital ( Z in lakh)
Balance at the beginning of the reporting period 01.04.2019
Changes in equity share capital during the year Balance at the end of the reporting period 31.03.2020
46260.90 46260.90
B. Other Equity Particulars General Reserve Capital
Reserve Corporate Social Responsibilit v Reserve
Mine Closure Reserves
Currency Fluctuation
Reserve
Retained Earnings Total
Balance at the beginning of the reporting period 01.04.2019
8965.97 21166.24 - 163.00 155.94 86985.19 117436.34
Dividends & Dividend Tax - - (5800.08) (5800.08)
Profit for the Year (56935.41) (56935.41)
Other Comprehensive Income (net of tax) (2245.67) (2245.67)
Amout addition during the year 75.00 (2764.59) (2689.59)
Amout used during the year Balance at the end of the reporting period 31.03.2020
8965.97 21166.24 238.00 (2608.65) 22004.03 49765.59
Statement of Changes in Equity A . Equity Share Capital ( t in lakh)
Balance at the beginning of the reporting period 01.04.2020
Changes in equity share capital during the period Balance at the end of the reporting period 31.12.2020
46260.90 - 46260.90
B. Other Equity Particulars General Reserve Capital
Reserve Corporate Social Responsibilit y Reserve
Mine Closure Reserves
Currency Fluctuation
Reserve
Retained Earnings Total
Balance at the beginning of the reporting period 01.04.2020
8965.97 21166.24 238.00 (2608.65) 22004.03 49765.59
Dividends & Dividend Tax -
Profit for the Year 14678.50 14678.50
Other Comprehensive Income (net of tax) (1122.48) (1122.48)
Amout addition during the year 1637.08 1637.08
Amout used during the year Balance at the end of the reporting period 31.12.2020
8965.97 21166.24 - 238.00 (971.57) 35560.05 64958.69
As per our limited review report
For Chaturvedi & Co. Chartered Accountants FRN 302137E
of even date attached.
ii L.
tit ilt:Inta Sukhen Kumar Company Secretary Director (M No. ECS 2570) (
(Finance) DIN : 08173882)
Bandyopadhyay
For and on behalf of the Board of Directors
A _ Arun Kumar Shukla
& CFO Chairman and Managing Director & CEO ( DIN : 03324672)
- ..
(CA R K NANDA ) Partner (M No. 510574 )
Place : Kolkata Dated: oT• o)l. 202-1
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7
HINDUSTAN COPPER LIMITED (A GOVT. OF INDIA ENTERPRISE)
Regd. Office : Tamra Bhavan 1, Ashutosh Chowdhury Avenue, Kolkata -700 019. CIN: L27201WB1967001028825
Condensed Interim Unaudited Standalone Statement of Cash Flow for the Nine Months Period ended 31st December 2020 (r in lakh)
Nine months period Year ended 31st ended 31st Dec 2020 March, 2020 (Unaudited) (Audited) Reviewed
A. CASH FLOW FROM OPERATING ACTIVITIES : NET PROFIT/ (LOSS) BEFORE TAX AS PER STATEMENT OF PROFIT AND LOSS 15,045.21 (53,771.43) Adjusted for :
Depreciation 3,105.23 3,589.34 Provisions charged 591.37 18,884.59 Provisions written back (981.69) (2,280.83) Interest expense 5,103.52 6,041.89 Amortisation 17,073.67 25,271.73 Interest income (25.95) (1,021.90) Loss / (Profit) on disposal of fixed assets - 2.04
OPERATING PROFIT/ (LOSS) BEFORE WORKING CAPITAL CHANGES 39,911.36 (3,284.57) Adjusted for:
Decrease/ (Increase) in Trade & other Receivables (5,893.42) 27,921.74 Decrease/ (Increase) in Inventories 32,310.75 (5,682.60) Decrease/ (Increase) in Current & Non-Current assets (5,206.07) (3,808.73) Increase/ (Decrease) in Current & Non-Current Liabilities (545.66) (2,119.57)
CASH GENERATED FROM OPERATIONS 60,576.96 13,026.27 Taxes paid - (4,423.72)
NET CASH FROM OPERATING ACTIVITIES (A) 60,576.96 8,602.55
B. CASH FLOW FROM INVESTING ACTIVITIES: Purchase of Fixed Assets (13,275.51) (22,082.84) Interest received 27.38 1,015.68
Investment in Joint Venture / Subsidiary (55.40) (3.00) Mine Development Expenditure (12,926.38) (21,913.69)
NET CASH USED IN INVESTING ACTIVITIES ( B ) (26,229.91) (42,983.85)
C. CASH FLOW FROM FINANCING ACTIVITIES Non-Current borrowings! Loan repaid 23,664.35 15,895.21 Dividends paid - (4,811.14) Tax on Dividend - (988.94) Interest paid (5,142.50) (5,895.91)
NET CASH USED IN FINANCING ACTIVITIES ( C ) 18,521.85 4,199.22 52,868.90 (30,182.08) NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C)
CASH AND CASH EQUIVALENTS - opening balance (68,300.65) (38,118.57) CASH AND CASH EQUIVALENTS - closing balance (15,431.75) (68,300.65)
( Details in Annexure - A)
Notes This is the Cash Flow Statement referred to in our limited review report of even date. The above Condensed Interim Unaudited Standalone Cash Flow Statement should be read in conjunction with the accompanying notes.
For and lb
(ILL
•
on behalf of the Board of Directors
a. For Chaturvedi & Co. C.S.Singhi Sukhen Kumar Bandyopadhyay Arun K Shukla Chartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEO ERN 302137E (M No. FCS 2570) ( DIN : 08173882) ( DIN : 03324672)
-; CAR K NANDA Partner (M No. 510574 )
Place : Kolkata Dated: 07, 01). 2,02,1
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CASH AND CASH EQUIVALENTS - Opening Balance
i) Current Financial Assets-Cash & Cash Equivalents
ii) Current Financial Assets - Bank Balance other that above (Excluding Unpaid Dividend of Z20.31 lakh)
Hi) Current Financial Assets - Investments iv) Non-current Financial Assets - Others v) Current Financial Liabilities - Borrowings
Long Term Loans of! 22846.55 lakh)
01/04/2020
1,134.71
432.21
9.48 26.36
(69,903.41)
ANNEXURE - A in lakh
01/0412019
658.42
408.33
8.85 12.47
(39,206.64)
(Excluding (68,300.65) (38,118.57)
CASH AND CASH EQUIVALENTS - Closing Balance
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) ii) Current Financial Assets - Bank Balance other that above (Note 14
(Excluding Unpaid Dividend oft 15.56 lakh)
Hi) Current Financial Assets - Investments (Note - 11) iv) Non-current Financial Assets - Others (Note No. 6) v) Current Financial Liabilities - Borrowings (Note No.23)
Long Term Loans of! 23760.25 lakh)
31/12/2020
2,638.29
9.87 470.57
(18,550.48)
31/03/2020
1,134.71 432.21
9.48 26.36
(69,903.41)
(Excluding (15,431.75) (68,300.65)
The Cash Flow Statement has been prepared as set out in Indian Accounting Standard (IND AS) 7: STATEMENT OF CASH FLOWS, as amended by Companies (Indian Accounting Standards) (Amendment) Rules 2016.
This is the Cash Flow Statement referred to in our report of even date attached.
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HINDUSTAN COPPER LIMITED
NOTES TO CONDENSED INTERIM UNAUDITED STADALONE FINANCIAL STATEMENTS
1.Corporate Information
Hindustan Copper Limited, established in 1967 and domiciled in India is a Central public sector undertaking under the administrative control of Ministry of Mines, Government of India. The registered office of the company is situated at Kolkata. The principal activities of the company are exploration, exploitation, mining of copper and copper ore including beneficiation of minerals, smelting and refining. The Company has copper mines & concentrator plants in Malanjkhand Copper Project at Madhya Pradesh (MCP), Khetri Copper Complex at Rajasthan (KCC) and Indian Copper Complex, Ghatsila at Jharkhand (ICC). The company is operating Smelter & Refinery in ICC and Gujarat Copper Project, Gujarat (GCP) for production of copper cathode. Further, cathode is converted into copper wire rod at Copper wire rod plant at Taloja Copper Project, Taloja, Maharashtra (TCP). The Company is listed with BSE Ltd. and National Stock Exchange of India Ltd.
2.5ignificant Accounting Policies
2.1 Basis of Accounting
The financial statements are prepared under historical cost convention from the books of accounts maintained under accrual basis except for certain financial instruments which are measured at fair value and in accordance with the Indian Accounting Standards prescribed under Companies Act, 2013.
2.2 Application of Indian Accounting Standards (Ind-AS)
The Company adopted Indian Accounting Standards (Ind AS) from April 1,2016 and accordingly the financial statements have been prepared in accordance with the recognition and measurement principles as notified by MCA under the Companies (Indian Accounting Standards) Rules, 2015 ("Ind AS Rules"), as amended and other relevant provisions of the Companies Act, 2013.
The Company has adopted all the Ind AS as applicable and relevant to the Company.
2.3 Use of Estimates
The preparation of the Company's financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Revision to accounting estimates are recognised in the period on which the estimates are revised and, if material their effects are disclosed on the notes to the financial statements.
2.4 Current and Non-current Classification
The Company presents assets and liabilities in the Balance sheet based on current/non-current classification. An asset are treated as current by the company when:
a) its expects to realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it holds the assets primarily for the purpose of trading;
c) it expects to realize the asset within twelve months after the reporting date; or
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d) the asset is cash or cash equivalent (as defined under Ind AS 7) unless the asset is restricted t o from being exchanged or used to settle a liability for at least twelve months after the reporting period.
Except the above, all other assets are classified as Non-current.
A liability is treated as current by the company when:
a) its expects to settle the liability realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it expects to settle the liability in its normal operating cycle;
c) it holds the liability primarily for the purpose of trading;
d) the liability is due to be settled within twelve months after the reporting period; or
e) it does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
Except the above, all other liabilities are classified as non-current.
2.5 Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable and fair value has been defined taking into account contractually defined terms of payment. Operating revenue recognized is net of all promotional expenses and discounts, rebates and/or any other incentive to customers.
Sale of Products
An entity shall account for a sale contract with a customer only when all of the following criteria are met:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are committed to perform their respective obligations;
(b) the entity can identify each party's rights regarding the goods to be transferred;
(c) the entity can identify the payment terms for the goods to be transferred;
(d) the contract has commercial substance i.e the risk, ownership, timing or amount of the entity's future cash flows etc is expected to change as a result of the contract; and
(e) it is probable that the entity will collect the consideration to which it will be entitled in exchange for the goods that will be transferred to the customer.
In case of sale of Copper Concentrate, Copper Reverts, Anode Slime etc. and tolling of Copper Concentrate of Khetri and Malanjkhand origin, sales / tolling at the end of the accounting period are recorded on provisional basis as per standard parameters for want of actual specifications and differential sales value are recorded only on receipt of actual. This is as per consistent practice followed by the company.
Sale of Services
Income from conversion of job work is accounted for on the basis of actual quantity dispatched. When the outcome of a transaction involving the rendering of services can be estimated reliably,
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revenue associated with the transaction shall be recognized by reference to the stage of completion (Percentage of Completion Method) of the transaction at the end of the reporting period.
Advances received from the customers are reported as customer's deposits unless the above conditions for revenue recognition are met.
Other Operating Revenues
a. Sale of Scrap
Sale of Scrap is accounted for on delivery of material.
b. Interest from Customers
In case of credit sales ,interest up to the date of Balance Sheet on all outstanding bills is accounted for on accrual basis.
c. Interest from Contractors against mobilisation advance for mining operations
Interest up to the date of Balance Sheet on all mobilisation advances for mining operations is accounted for on accrual basis.
d. Penalty and Liquidated Damages
Penalty and liquidated damages are accounted for as and when these are realised by the company as per contract terms.
Other Income
a. Claims
Claims are recognized in the Statement of Profit & Loss (Net of any payable) including receivables from Government towards subsidy, cash incentives, reimbursement of losses, etc, when there is certainty of realisation of such claim and that can be measured reliably.
b. Dividend and Interest from Investments
Dividend income from Investments is recognised in the Statement of Profit and Loss when the right to receive the dividend has been established and it is certain that the economic benefits will flow to the company and the amount of income can be measured reliably.
Interest Income from a financial asset is recognised using Effective Interest Method. When it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably.
c. Profit on Sale of Investment
Profit on sale of investment is recognised upon transfer of title by the company and is determined as the difference between the sales price and the then carrying value of the investment.
d.Provisions not required written back
Provisions/Liabilities created from business activities in earlier years no longer required are accounted for.
e. Others
Any other income is recognised on accrual basis.
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F)-
2.6 Employees Benefit
Retirement benefit costs and termination benefits
Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest), is reflected immediately in the statement of financial position with a charge or credit recognized in other comprehensive income in the period in which they occur. Re-measurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to Statement of Profit or Loss. Past service cost is recognized in Statement of Profit or Loss in the period of a plan amendment. Net
interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:
i. Service cost (including current service cost, past service cost, etc.); ii. Net interest expense or income; and iii. Re-measurement.
The company presents the first two components of defined benefit costs in profit or loss in the line item 'employee benefits expense'.
The retirement benefit obligation recognized in the statement of financial position represents the actual deficit or surplus in the company defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.
A liability for a termination benefit is recognized at the earlier of when the company can no longer withdraw the offer of the termination benefit and when the company recognises any related restructuring costs,
Short-term and other long-term employee benefits
A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.
Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the company in respect of services provided by employees up to the reporting date.
Deficit in Provident Fund
Deficit, if any, in the accounts of Provident Fund Trust ascertained on the basis of last audited accounts of the Trust is accounted for as a charge to Revenue.
A)ser
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2.7 Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest expenses calculated using the effective interest method and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs
2.8 Taxation
Income tax expense represents the sum of current tax and deferred tax.
Current tax
The current tax payable is based on taxable profit for the year as determined from net profit before tax as represented in Statement of Profit and Loss and Other Comprehensive Income, in line with different provisions under Income Tax Act 1961.Current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
Current and Deferred Tax for the year
Current and deferred tax are recognized in Statement of Profit or Loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity respectively.
2.9(a) Property Plant and Equipments (PPE)
The cost of an item of PPE is recognized as an asset if and only if, it is probable that future economic benefits associated with the item will flow to the company and the cost of the item can be measured reliably. The cost of an item of PPE is the cash price equivalent at the recognition date. The cost of an item of PPE comprises:
i. Purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates.
U. Costs directly attributable to bringing the PPE to the location and condition necessary for it to be capable of operating in the manner intended by management.
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iii. The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which the company incurs either when the PPE is acquired or as a consequence of having used the PPE during a particular period for purposes other than to produce inventories during that period.
The company has chosen the cost model of recognition and this model is applied to an entire class of PPE. After recognition as an asset, an item of PPE is carried at its cost less any accumulated depreciation and any accumulated impairment losses.
Pending reconciliation/receipt of the final bills against capital items, capitalization is done on the basis of cost booked and depreciation is charged accordingly. Price differences, if any, are adjusted in the year of finalization of bills.
In respect of expenditure during construction/development of a new unit/project in a new location, all direct capital expenditure as well as all indirect expenditure incidentals to construction are capitalized allocating to various items of PPE on an appropriate basis. Expansion programme involving construction concurrently run with normal production activities in an existing unit, all direct capital expenditure in relation to such expansion are capitalized but indirect expenditure are charged to revenue. Borrowing costs that are attributable to the acquisition or construction of qualifying asset are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.
Expenses incurred for implementation of new projects are carried forward against respective projects till execution. Expenses rendered in fructuous projects abandoned subsequently are provided for in the Statement of Profit & Loss.
Physical verification of PPE is conducted every year so that all the units/offices are covered once in a block of three years interval. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification.
Depreciation and Amortization
The company has used the exemption available in Ind AS 101 with respect to recognition of Plant, Property and Equipment (PPE) and Intangible Assets at their carrying value being deemed cost.
The depreciable amount of an item of PPE is allocated on a straight line basis over its useful life prescribed in Part C of Schedule II of the Companies Act,2013 or actual useful life of assets assessed by the Technical Committee of the company, whichever is lower. The residual value and the useful life of an asset are reviewed, at each financial year-end. Each part of an item of PPE with a cost that is significant in relation to the total cost of the item is depreciated separately. Depreciation on all such items have been provided from the date they are 'Put to Use' till the date of sale and includes amortization of intangible assets and lease hold assets. Freehold land is not depreciated. The residual value of all such items is taken at 5% of the original cost of individual asset.
An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Certain consumable items of small value whose useful life is very limited are directly charged to revenue in the year of purchase.
From the date Ind AS came into effect, the carrying amount of an asset is depreciated over the remaining useful life of the asset as per estimate of remaining useful life. Wherever, the remaining useful life of an asset is nil, the carrying amount is recognized in the opening balance of retained earnings after retaining the residual value.
2.9(b) Intangible Assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is their fair value at the date of acquisition.
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Following initial recognition, intangible assets are carried at cost less any accumulated amortisation (calculated on a straight-line basis over their useful lives) and accumulated impairment losses, if any.
Internally generated intangibles, excluding capitalised development costs, are not capitalised. Instead, the related expenditure is recognised in the statement of profit and loss and other comprehensive income in the period in which the expenditure is incurred. An internally generated intangible asset arising from development is recognized if all the conditions stipulated in "Ind AS 38-Intangible Asset" are met. The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.
An intangible asset with an indefinite useful life is not amortised but is tested for impairment at each reporting date and its useful life is reviewed in each reporting period to determine whether events and circumstances continue to support an indefinite useful life estimate.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss.
Intangible Assets other than Software are amortized over estimated useful life which is equivalent to license period, generally not more than 5 years.
Cost of Software recognized as intangible asset, is amortised on straight line method over a period of legal right to use with a nil residual value. Otherwise the cost of software will be charged in the year of incurrence.
2.10 Capital Work in Progress
Assets in the course of construction are included under capital work -in-progress and are carried at cost, less any recognized impairment loss. Such capital work-in-progress, on completion, is transferred to the appropriate category of property, plant and equipment.
2.11 Mine Development Expenditure
In case of underground mines : The expenditure on development of a new mine in all cases and on subsequent development of a working mine is capitalized and depleted on the basis of ore raised during the year and the mineable ore reserves estimated from time to time.
In case of working mines, where development activities are going on simultaneously: Expenses are apportioned between capital and revenue on the basis of in-house technical estimates.
In respect of open cast mines : The expenditure on removal of waste and overburden, is capitalized and the same is depleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodically based on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines. Subsequently, If any ore is reclaimed from overburden, the same is included in inventory at a value based on opening rate of mine development expenditure with a corresponding credit in Mine development expenditure.
Expenditure incurred on development of new deposits are capital in nature and is included in mine development expenditure. If subsequently the development activities are found to be not viable, the expenditure on such development work included in mine development expenditure is written off in the year in which it is decided to abandon the project.
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If a working mine is closed due to economic reasons, the un-depleted value of Mine Expenditure related to that mine is provided in the books of accounts in the year decided to close or suspend operation of the mine. If later on, the closed / suspended opened and the company remains the owner of the mines, the unamortized Mine Expenditure which was fully provided in the year of closure will be written back in accounts in the year of re-opening and the company will be depleting it year wise estimated remaining life of that mine.
Development in which it is mines are re-Development the books of based on the
6
2.12 Overhauling Expenses
Revenue expenditure attributable to overhaul of smelter and/ or refinery is charged off to the Statement of Profit & Loss in the year of incurrence. 2.13 Mine Closure Expenditure
Financial implications towards final mine closure plans under relevant Acts and Rules are technically estimated and Mine Closure Reserve is created based on the estimated life of the mines over the period by charging the same to Statement of Profit and Loss.
2.14 Non-Current Assets Held for Sale
The company classifies a non-current asset (or disposal group of assets) as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. Immediately before the initial classification of the asset (or disposal group) as held for sale, the carrying amounts of the asset (or all the assets and liabilities in the group) are to be measured in accordance with applicable Indian Accounting Standards. The sale should be expected to qualify for recognition as a completed sale within one year from the date of classification except as permitted by Ind AS 105.
2.15 Inventories
Stocks of stores and spare parts, loose tools and materials-in-transit are valued at the lower of the net realizable value and cost. The raw materials are also valued at the lower of the net realizable value and weighted average cost to the unit if the finished goods in which they will be incorporated are expected to be sold below cost. Loose tools when issued are charged off to revenue.
Finished goods and work-in-process are valued at the lower of the net realizable value and weighted average cost to the unit. The cost is exclusive of financing cost, such as, interest, bank charges, administration overhead, etc. Ore is valued at cost since its realisable value cannot be ascertained. The value of slag under work-in-process is taken at equivalent value to the extent credited to the process, where the said products have been generated. The reverts under work- in-process are valued at lower of cost (equivalent value of concentrate) and net realizable value.
The stock of anode slime arising from treatment and refining processes are stated at realizable value based on the yearend London Metal Exchange price for gold and silver after making due adjustments of their physical recovery and the treatment and refining charges.
The inventories out of inter-unit transfers (material in transit) at the close of the year are valued and accounted in the books of the transferor unit on the basis of cost plus transportation to the transferee unit or net realisable value whichever is lower.
Imported materials are valued at the lower of the net realizable value and weighted average cost. In the event where final price is not determined valuation is made on provisional cost. Variations are accounted for in the year of finalization.
Provision is made in the accounts every year, for non-moving stores and spares (other than insurance spares) which have not moved for more than five years. Insurance spares are fully provided for on the expiry of the life of the relevant Property Plant and Equipments.
F-375
Physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all the units at reasonable intervals during the year by a duly approved committee. Also, physical stock verification of WIP and Finished Goods is undertaken by a duly approved committee at the end of every financial year alongwith an independent agency once in a block of three years. In respect of Stores and Spares, physical verification is carried out by external agencies once in every year covering all the units. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification
2.16 Government Grants
All government grants are recognized as deferred income and it will be taken to Statement of Profit and Loss over the period of time in accordance with the pattern in which the obligations are met.
2.17 Impairment of Assets (Other than Financial Assets)
The Company assesses at the end of each reporting period whether there is any indication that an asset may be impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in Statement of Profit and Loss, unless the relevant asset is carried at a revalue amount, in which case the impairment loss is treated as a revaluation decrease.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
2.18 Foreign Exchange Transactions
Transactions in currencies other than the company's functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are re-translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Foreign currency monetary items (except overdue recoverable where realizability is uncertain) are converted using the closing rate as defined in the Ind AS-21- The effects of changes in Foreign Exchange Rates. Non-monetary items are reported using the exchange rate at the date of the transaction. The exchange difference gain/loss is recognized in the Statement of Profit and Loss.
In case of long term foreign currency monetary items outstanding as of 31st March 2016,liability in foreign currency loans relating to acquisition of fixed assets is converted using the closing rate as
R
F-376
defined in Ind AS 21-The effects of changes in Foreign Exchange Rates and the difference in exchange is recognized in terms of exemptions given in paragraph D13AA of Appendix D to Ind AS-101, where the effect of exchange differences on foreign currency loans of the company is accounted for by addition or deduction to the cost of the assets so far it relates to the depreciable capital assets and shall be depreciated over the balance life of the assets.
Other long term foreign currency monetary items are accumulated in 'Equity Component of Foreign Currency asset/liability Account' and amortized over the balance period of the asset/liability by recognition as income or expense in each of such periods as stated under Para 29A of Ind As 21.
2.19 Provisions, Contingent Liabilities & Contingent Assets
Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past event and it is probable that the company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
Wherever no reliable estimate could be made, a disclosure is made as contingent liability. A disclosure for a contingent liability is also made when there is a possible obligation or a present obligation that may but probably will not require an outflow of resources.
When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.
Contingent Liabilities are disclosed in the General Notes forming part of the accounts.
Contingent Assets are not recognised in the financial statements but are disclosed in Notes to the Accounts. Such assets occur when the inflow of economic benefits is probable. Such contingent assets are assessed continuously, if it's virtually certain that inflow of economic benefits will arise then such assets and the relative income will be recognised in the financial statements.
2.20 Leasing
Assets held under lease, in which a significant portion of the risks and rewards of ownership are transferred to lessee are classified as finance leases. All other leases are classified as operating leases.
Depreciation expenses are recorded if asset held under finance lease is depreciable.
Finance expenses are recognized immediately in the statement of profit and loss if they are not directly attributable to qualifying assets, otherwise they are capitalised in accordance with the company's general policy on borrowing costs.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term.
2.21 Financial Instruments
Non Derivative Financial Instruments
(i) Initial Recognition
Financial assets and financial liabilities are recognized when the company becomes a party to the contractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate,
40-
F-377
ffi on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.
(ii) Subsequent Recognition
a. Financial assets Financial assets are subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss.
b. Financial Liabilities Financial liabilities are subsequently measured at amortized cost using Effective Interest Rate (EIR) method except for derivatives, which are measured at fair value.
Derivative Financial Instruments
All derivatives are recognized and measured at fair value with changes in fair value being recognized in profit or loss for the period.
Impairment of financial assets
At each reporting date, assessment is made whether the credit risk on a financial instrument has increased significantly or not since initial recognition.
If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance is measured for that financial instrument at an amount equal to 12 month expected credit losses. If the credit risk on that financial instrument has increased significantly since initial recognition, the loss allowance is measured for a financial instrument at an amount equal to the lifetime expected credit losses.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date is recognised as an impairment gain or loss in the statement of profit and loss.
2.22 Events Occurring after the Reporting Period
The company adjusts the amount recognized in its financial statements to reflect adjusting material events after the reporting period and does not adjust the amount to reflect non-adjusting events after the reporting period. However where retrospective restatement is not practicable for a particular prior period then the circumstances that lead to the existence of that condition and the description of how and from where the error is corrected are disclosed in Notes on Accounts.
2.23 Dividends
Final dividend on shares are recorded as a liability on the date of approval by the shareholders in general meeting and interim dividends are recorded as a liability on the date of declaration by the directors in the meeting of the Board of Directors.
2.24 Cash and Cash Equivalents
Cash and cash equivalent in the Balance Sheet comprise cash at bank and on hand and short term deposit with an original maturity of three months or less which are subject to insignificant risk of changes in value.
2.25 Rounding of amounts
Amounts in these financial statements have, unless otherwise indicated, have been rounded off to 'Rupees in lakh' upto two decimal points.
F-378
Note : 3 (A) Standalone Propertv.Plant and Equipment (Active AssetS1 (Z in lakh)
DESCRIPTION Free Hold Land
burr/rings Including
Sanitary and Water Supply
Cuctem
Plant.Machiner y and Mining Equipment
Furniture & Fixtures 6( Office
Equipment Vehicles Roads. (Ridges
d C an ulverts Railway siding Electrical
Equipment and installation
Shafts and Inclines Total
Gross Camino Amount
Gross Carrying Amount as at 01.04.2019 2006.58 67213.85 26588.06 317.87 168.24 1826.39 293.86 2878.22 444.21 41692.28 Exchange Differences Additions inter-head Transfer In ((Out)
14.47 1626.18 89.29 57.73 41.52 1820.19
Transfer From Discarded Assets • - - • - Transfer To Discarded Assets - • • • Disposals (13.59) (0.01) (0.45) (0.02) (14.07) Transfer • Adjustments 0.58 (0.011 - 0.01 (0.01) 0.57
Gross Carrying Amount as at 31.03.2020 2046.58 6743.32 28201.23 002.14 225.52 1826.00 293.86 2919.71 940.21 03502.97
Accumulated DeoreClatien & Impairment
Accumulated Depreciation as at 01.04.2019 2042.70 5926.16 104.81 63.90 987.39 98.01 778.57 41.97 10043.51 Depreciation charge dogma the year 522.27 2846.05 43.37 29.44 325.17 32.67 722.95 13.99 4035.91 Inter-head Transfer in /(Out) Transfer From Discarded Assets • • Transfer To Discarded Assets • - Impairment Losses Exchange Differences DispoSals Tranfer
Accumulated Depreciaton & impairment as at 31.03.2020 2569.97 8772.21 148.18 93.34 1312.56 130.68 1001.52 55.96 14079.42
Net Carrying Amount as at 31.03.2020 2446.58 0178.35 19429.02 253.96 132.18 513.84 163.18 1918.19 388.25 29923.55
GASS Carratina Amount
Gress Carrying Amount as at 01.04.2020 2446.58 6743.32 28201.23 402.14 225.52 1826.40 293.86 2919.71 444.21 43502.97 Exchange Differences Additions • 226.95 12,411.50 1.19 • - 12639.09 intenhead Transfer In /(Out) • Transfer From Discarded Assets Transfer To Discarded Assets • Disposals (0.32) (0.32) Transfer • Adjustments (0.02) (0.02)
Gross Carrying Amount as at 31.12.2020 2446.58 6969.77 40612.73 403.28 225.18 1826.40 293.86 2919.71 444.21 56101.72
Accumulated Depredation & impairment
Accumulated Depreciation as at 01.04.2020 2564.97 8772.71 148.18 93.30 1312.56 130.68 1001.52 55.96 14079.42 Depreciation charge during the year • 401.39 2597.48 92.58 29.43 100.17 20.62 112.35 10.54 3318.56 Inter-head Transfer in /(Out) Transfer From Discarded Assets • • - Transfer To Discarded Assets • • Impairment Losses • • Exchange Differences • Disposals • . Transfer
Accumulated Depreciaton 6 Impairment as at 31.12.2020 2966.36 11369.69 190.76 172.77 1412.73 155.30 1113.87 66.50 17397.98
Net Carrying Amount as at 31.12.2020 2406.58 4003.41 29243.04 212.53 102.41 413.67 138.56 1805.84 377.71 38743.75 Note HCL has used the exemption available in Ind AS 101 with respect to recognition of Property. Plant. Equipments (PPE) and intangible Assets at their Carrying value.
F-379
Note : 3 (B) Standalone Property,Plant and Equipment (Discarded Assets} (!in lakh)
DESCRIPTION Free Hold & Lease Hold
Land
mornings including
Sanitary and Water Supply
qvstem
Plant,Machiner y and Mining Equipment
Furniture & Fixtures 6, Office
Equipment Vehicles Roads Bridoes
and Culve ' - $ rt Railway Siding Electrical
Equipment and installation
Shafts and inclines Total
Gross Canvina Amount
364 181 91 946.84 39.56 23.09 24 93 62.28
000
92
0.00
30 1.374,55 Gross Carrying Amount as at 0104.2019 Exchange Differences Additions inter-head Transfer In flout) Transfer From Active Assets Transfer To Active Assets Disposals Impairment Losses Adjustments
Gross Carrying Amount as at 31.03.2020 3.64 181.91 946.84 39.56 23.09 24.93 62.28 92.30 1374.55
Accumulated Depreciation & Impairment
Accumulated Depreciation as at 01.04.2019 Depreciation charge during the year Inter-head Transfer In /(Out) Transfer From Discarded Assets Transfer To Discarded Assets Impairment Losses Exchange Differences Disposals
Accumulated Depreciaton & Impairment as at 3 03.2020 . Net Carrying Amount as at31.03.2020 3.64 181.91 946.84 39.56 23.09 24.93 62.28 92.30 1374.55 Less Provisions for Discarded Assets 1374.55 Net Carrying Amount (Net of Provisions) as at 31.03.2020
Gross Camilna Amount
3.64 181.91 946.84 39 56 23.09 24 93 62 28 92.30 1374.55 Gross Carrying Amount as at 01.04.2020 Exchange Differences Additions Inter-head Transfer In flout) Transfer From Active Assets Transfer To Active Assets Disposals Impairment Losses Adjustments
Gross Carrying Amount as at 31.12.2020 3.64 181.91 946.84 39.56 23.09 24.93 62.28 92.30 1374.55 Accumulated Depreciation & Impairment
Accumulated Depreciation as at 01.04.2020 Depreciation charge during the year Inter-head Transfer In /(Out) Transfer From Discarded Assets Transfer To Discarded Assets Impairment LOSSeS Exchange Differences Disposals
Accumulated Depreciaton & Impairment as at 31.12.2020
. .
Net Carrying Amount as at 31.13.2010 I 3.64 I 181.91 I 946.84 I 39.56 I 23.09 I 24.93 I 62.28 92.30 13/4.55 'Less Provisions for Discarded Assets 1374.55 Net Carrying Amount (Net or Provisions) as at 31.11.1021)
Note : HCL has used the exemption available in Ind AS 101 with respect to recognition of Property, Plant, Equipments (PPE) and Intangible Assets at their carrying value.
F-380
As al 31st December 2020 As .631st MINI:L.2020
(Unaudited) Reviewed (Audited) PARTICULARS
Sank deposits with more than 12 morals matt* - With scheduled banks 470.57 26.15
26.36 470.57 TOTAL
54.55 3.1 TOTAL
AGGREGATE BOOK VALUE- UNOUOTED
AGGREGATE BOOK VALUE • QUOTED
MARKET PRICE OF QUOTED INVESTMENT
PARTICULARS
As at 31st December 2020 As at 31st March. 2020
lUnaudned) Reviewed (Audited)
18.50 33.30
10.35
11.19 015
Investm•Ms In equity Instruments -Iclassffied es at cost) investment in Subsidiary Company- ChhetTailadi Conner Limited (CCL) (Investment in CCL 333,000 Na,. (Previous roar 185,000Nos) of equity shares of CIO (Previous Year tiro each fully paid up as at 31.122020) Less : Provision Mr share of Loss at Investment kr Subeltkary uplo 31.032020 TOTAL
0.17 0.17
0.17 0.17
15) Non Trod. Investment in Debentures Less Provision tor dminufion M value
3.00 75.00
2784
Principal Activity And place of inuoPoratien principal place of business
Proportion of ownership interest I voting rights held by the Company as on 31.03.2020
Exploralice 8 IANng and beneficebon of cOPPOI Lb assouldlad minerals
okhatosgadi 74%
M Investments in equity instruments - (classified seen coal'
A Joint Venture Company(SC) named Kframi Utah In.:1a Limited (KAB1L) was formed on 01.08.2019 among National Almunlum Company (NALCO) .1-Lodustm Copper Urriged (HCL) end Mineral Exploration Corporation Limited (T.ECL)
Investment M N Company - KherijBidesh India Limited (KASS) (Invest:non' In KABIL75,000 Nos, (Previous Year 30,000 Nos.) of equity shares of TIO (Previous Veer! 10) each fully paid up as at 31,12.2020) Less: PRIVaion far share of Loss of Investment in Joint Venture upto 31.032020
47.36 3.00 TOTAL
--v.-- PrincipalActivityand place of incoporalion Principal place of
business Proportion of ownership Interest / voting rights held by On.
Company as on 31.03.2030
To Identify . explore, acquire, develop. Process PlimaNY strategic minerals overseas Mr supply to India for ineatin0 domestic requirements and for sale to en) other countries for commercial use.
New Delhi 30%
58.55 3.16
Nil Nil
Note No 6 NON -CURRENT FINANCIAL ASSETS -OTHERS IT hi kh)
Note No 4 CAPITAL WORK IN PROGRESS In lath)
As .' 31st December 2020 As et 31st March, 2020 PARTICULARS (Unaudited' Reviewed (Audited'
I) Buddha
M Plant 8 Machnery 5.) Others including Mine ExPension
Las: Proton
24.22 183.27
21630.87 31389.11
105551 07 92018.10
127207.06 126570.48
3392.01 3392.91
TOTAL 1211114.15 123177.57
Note No 5 NON -CURRENT FINANCLAL ASSETS -INVESTMENTS (t In lakh)
F-381
Note No 0 OTHER NON -CURRENT ASSETS (2 in la
As 00 3151 December .2020
As let 3151 Mardi, 2020 PARTICULARS udited) Review.]
(NA OS)
1631.96
- Ageinst Bank Guarantee - Others
Unsecued (considered NOMA) 002 0.02
Less: Provisions for CeMtal Advances • 0.02 0.02
Mine Davelopmeni Expenditure As per Last Balance Sheet 4020435 5111502
Add: Expenditure dude% the Year las per Note Below) 13100.76 2250021
61505.13
Las: Value at Ore recovered during Mina NivelopMent 561.07 144.95
Less: Amortisadon duxes° the Year 1707167 17234.74 25271.73
44270.25 4504.50 Las: Provision
TOTAL 39605.53
Note: MINE DEVELOPMENT ESPENDITURE DURING THE YEAR Names, Weges, Allowences 1726.15
COndibuliOn to Provident it Other Funds 134.58
Workmen A Stafr Welters EspenSeS 2.15
Stores, Spares A Tools Consumed 1E1.04
Power. Fuel 6 Weer 420.20
RoyetlY 11.71
Repair IS Meantime. 239903
Insurante 1.33
Overburden Remo's! Expendibire 6790.10
DePrecislOOn 213.33
Other Exegete. 372.90
TOTAL Innen
The above expenditure Is In addition lots. expenses shown under the respectivw natural head of accounts Indicated and charged In Cie Statement al Profft and
Loss Account Mr the year sod In the relevant schedules thereof.
turtorttegion during the yam is hi relation to the eXpense Incurred On minty 'Alen are wider operatIcii/production and does not irmhtde expenditure cm
pospecling of minerals In new ad na area.
I) Right to Use Red ion Leasehold Lend TOTAL
0
a) MOBILISATION ADVANCES
0 Secured (considered good) 10 unsecured (considered good)
Ii)
200402 3904.03
4097.67 4097.67
1632.12
73621.03
2541661
40204.15 6,56.06
41539.40
26553) 21143
0.08 050370 050.21 11.03
435283 1.17
11275 24 440.57 022.90
22505.21
(A in lath) o iv. •
PARTICULARS As at 31st December X20
(Unaudited) Reviewed As et 31st 2320
(Audited)
I) DEFERRED TAX ASSET OPENING BALANCE 5604.22 8243.90
AdjustmentlGredit dudm2 the yeer 350005 13371681
CLOSING BALANCE 0365.17 5864.22
I) DEFERRED TAX LIABILITY OPENING BALANCE 0914.431 (2908.28)
AdjustmenifCredit dude() the leer 06.101 100315
CLOSING BALANCE (1930.53) /1914 43)
ON) DEFERRED TAX ASSETS! (0ABILMES) NO 7434.04 39412E
El) DEFINED BENEFIT PLANS OPENING BALANCE 1341.02 565.74
Adjustmen0Credit during the year 377.52 755.29
CLOSING BALANCE 1718 134155
9N-curacy I MA .0.....0 la i twilit,. mei Melt NWILIOIng nut
9153.18 530081
(Refer Note No. 39 email Notes on AeOnurfs PQM No. 10)
Nate No a NONCURRENT TAX ASSETS NET] 0 in Lath)
As le 31.1 December .2020 As it 31st March. 2020 PARTICULARS (UnaudE3411 Reviewed (Aullted)
Income Tax (including !Sumas Income tux, TDS 6 excluthng
num., tan liabOltY) Unsecured - Considered good 66182 689.92
TOTAL 689212 41182
TOTAL WINN.
PROWSIONS FOR CAPITAL ADVANCES OPENING BALANCE MdOtnS dunng Ins yew Amount Neel dudng he year CLOSING BALANCE
45221 51 45289.25
0.02 002
0.02 0.62
F-382
It In lath' CURRENT FINANCIAL ASSETS - INVESTMENTS
PARTICULARS
AB it 3191 °combo:2020 As it 3101 Matra, 2020
(Unaudited' ReHmed (Audited)
(T in lakh) No 10 OWENTORIES
PAR1100LARS As .131st December 2020 As at 3151 Maros, 2020
I unaudited) Reviewed (Audked)
ii Raw Matedals
Semi-FinIshed and h+Procest (at bow of casino net reellsoble value)
31930.22 6445803
Less, Provision for Semi-Finished and In-Process . 18454.83 1345329 16454.83 4080120
iii) Finished Goods let lower or cosi or net realisable value) 83.00 83.00
iv) Stores and sperm 7432.91 764810
Stores is transiU Inspection pending 1023 55 803 30 845848 8249.40
Less. ProvIslon for Obsofele Stores & Sperm 8 2350 98 1310506 2350 19 5558 .52
19671 97 519E3. TOTAL
PROVISION FOR SEMI-FINISHED AND 1N-PROCESS ' OPENING BALANCE 13454.63 123.03
Additions doing the year 16331.00
Amount used doing the year 1945443 19454.03
CLOSING BALANCE
PROVISION FOR OBSOLETE STORES a SPARES - OPENING BALANCE 2350.88 2618.03
Addillons during the year 0.00 1.40
Amount used doing the year 0.00 296.55
235023 2358.00 CLOSING 13MANCE
Investments 1) Mutual Fund "limber clf NAV On 31 (Matunty within 3 months from dale of miisnal investments) units L.71 MONEY MARKET -GROWTH 51.736 2367.78 1.21 2.17
(51.738) (211205)
SEX U_TRA SHORT TERM DEBT FUND - GROWTH 132.117 4479.65 0.72 592
(132 1171 (4155485
GROWTH 38.993 23E19.98 0.95 0.03
(33 9931 (7256.65) 68.489 2120.07 1.40
(60.4091 (2802.01) 9.87
Nil
7.64
9.87
(T in lakli) No 12 CURRENT FINANCIAL 855 TRADE RECEIVABLES
PARTCULARS
As *131st December ,2320 MM 3101 March, 2020
(Unaudited) Reviemel "Andkedl
DEBTS OUTSTANDING 1) - Secured - Considered good 13118.69 828035
II) - Unsecured - Considered geed -
Kg - Considered doubthel 1064.03 886.51 14182_71 9175.96
Loss: Alkmences for bad ft doubtful debts • 106408 13118.69 885.51 8289.35
1064.03 MI6
Explanatory Note: - Debt due by Diredors or other office% of the company trees of them either severally or NOW veth any other person of detis due by trrns 01 private corri any Dream of the Company is • partner or • Dirac-Me on a number amounts to Nil (Previous year NUL
it mhich
13110.69 6239
888.51 942.77
177.61 0.31
0.04 56S1
TOTAL
ALLOWANCES FOR BAD S DOUBTFUL DEBTS OPENING BALANCE Add/Sons during the year Amount used dodo, the year CLOSING BALANCE
REBECO LIQUID FUND CANARA -
ID/31 LIQUID FUND - GROWTH
TOTAL
AGGREGATE BOOK VALUE -UNQUOTE°
AGGREGATE BOOK VALUE- QUOTED
MARKET PRICE OF QUOTED INVESTMENT
9.48
MI
7.84
943
F-383
IT in lath) Is No 15 CURRENT FINANCLAL ASSETS. OTHERS
PARTICULARS
As at 31•1 December 2020 Al it 31St MlrtFk 2020
(Unaudited) Reviewed (Audited)
PARTICULARS
As .131st December 2020 As st 3110 Mara 2020
(Unaudited, RaI•vmd (Audited)
TOTAL 1134.71
As M 31•10nrober •131st Math. 2020
'Unaudited) Rev (Audited) PARTICULARS
n. 432.21
15.58 20.31
Cthe Belentes with Bank
- In DIvid•nd Saline, Account
Bank depoas vddi inix• then 3 months and upto 12 months inanity - With scteduled banks
CASH MID CASH EQUIVALENTS
I. Cash at hand Including impreM 0.35
Balance With Banks -Current Account 2838.04 113446
It OTHER BALANCES WITH BARK Bank deposds upto 3 months maturity from date sO neigreot investneM - WISe scheduled banks
Note No 14 CURRENT FINN4CIAL ASSETS - BANR BALANCE OTHER THAN CASKS CASH EQUIVALENTS IT In lakhl
15.55 452.52
el ADVANCE' Employees - Secured Rionsidered good) - Unseated (considered &NMI) Len: Provisbns for doutthd Advances' 2-03 2.03
13254 112.55
A) INTEREST ACCRUED ON Ii LC from CustOMen
fl 00
Ii) investment. 16.74 1065
II) DeposRs 20.31
66 Others 0.18 20.23 036 4206
CI CLAIMS RECOVERABLE Clans recoveraMe from dire( font agencies 5223.05 271281
Less' Provision for Doubtful Clans " 170.41 5043.25 175.41 2533.30
TOTAL (eftwo) 521E12 2166.41
RETAL FaDLE_LOL_I.0241S
PROVISION FOR DOUBTFUL ADVANCES •
3.03 2.03 OPENING BALANCE &ketone doling the year Amount used during the y...
2.03 303 CLOSING BALANCE
PROVISION FOR DOUBTFUL CLAIMS"
179.41 133 10 OPENING BALANCE
000 48.31 Additions doing the yeaf ?mount used dining the year
179.41 170.41 CLOSNO BALANCE
ExpIantory Note: -
PARTICULARS OF LOANS AND ADVANCES DUE FROM DIRECTORS 0 Amount due st the sod 011ie year 1161 ?NW
it Adam,* due by ferns or prhuite commies 6 tOich any 01re0e1 of th•Compeny the Partner or • director or • member amounts Oaf Idd (Previous yew Mil
112 55 2.03
132 64 2-03
Note No 13 CURRENT FINANCIAL ASSETS -CASH & CASH EQUIVALENTS IT In lakhl
F-384
As it 31st Norther .2020 As M 31st March, 2021
naudItsrl) RsvIsynd (Au8ese1) PARTICULARS
Irroomt Tax (815111609 .4001006 means tsx, TDS & paluding currant tax Rehitty) Unsecured - Considered porel
1866.82 1845 39
TOTAL 1088.62 1045.39
IT In lak h) Not. No 17 OTHER CURRTNT ASSETS
PARTICULARS
As it 3151 dumb, .2020 As it 31.1 Hareh. 2020
(Unaudited) Reviewed (ALOIS)
01 Advances to conlrectors / suppliers - Seared (considered good) 388.30 22 921
- Unsecured (considHed good) -Against Bank Guanntee
-Others 1023.02 1127.08
- Unsecured (considered doubtful) 018.08 87954
Iii) other Advances
2088.50 2045.63
- secured (considered goal) 50.90 5090
Unsecured (considered doubtftd) - 1393 13.93
64.83 04.83
215393 2110.66
Provision for Doubtful Loans and Advances • Less i 692.61 603.47
1480 72 1417.19
850 C) Advance to Subsidiary-CCL
dt Advance to Rd-KARR 72.00
5/ DEPOSITS
Other Deposits 10780.65 10138.08
Less: Provision for Doubtful Dep8085 75.58 75.56
10665.09 0088052
1) OTHER CURRENT ASSETS
Other Current Assets 210.68 211.52
Lew Pro/lion for Other Current ;Hoes ii" 3.52 3 52
207.14 206 00
91 OTHER RECOVERABLE&
h)
1657/COSTS SOOT
RIGHT TO USE
27704.00 25553.01
Rent for LessehoId Land 113054 206.81
TOTAL 40298.39
PETARS OF PROVISIGH2
PROVISION FOR DOUISTFUL LOANS MID ADVANCES '
OPENING BALANCE 623.47 737.28
AddAiom Owing the yam 0.26 292
Amount durin9 the used yew 1.12 40.31
CLOSING BALANCE 802.01 693.47
PROVISIONS FOR DEPOSITS
OPENING BALANCE 75.50 75.50
Additions during the year Amount used du/t101115 year
76.56 75 CLOSING BALANCE
PROVISION FOR OTHER CURRENT ASSETS
OPENING BALANCE 3.52 3.52
Additions dues; the year Amount used during the year
352 CLOSING BALANCE
f 1
2-4
Hots 040 18 CURRENT TAX ASSETS ( In Gbh)
F-385
PARTICULARS
As ei 31st Drieernber 2020 As M 314t March. 2020
(llnaudilwl) Reviewed (Audit•d)
703587852
105005000
7005% 703557552 7605%
1142% 105685656 11.42%
a) AUTreUHISE000IARE CAPHAL
No. ) InNo. IRinlacI
• Equity Shore Capital 1800000000 90000.00 1500000000 90000.00
- 700% Non-Cum. Redeemable Preference Sheen 2800000 2000000 200 2000
13) PAR VALUE PER EOUITY SHARE (In!) 5.00 5.00
CI PAR VALUE PER PREFERENCE SHARE (In!) 1000.00 1000.00
, dlnu. annrtca laaLMIJ, OVINUIllOCid NOW rULLIP rI•PJ Din
- &wit/ Share Capital 925218000 40200.90 925218000 4(260.90
- 7.50% Non-Corn. Redeamable Preference Sham
TOTAL 46260.90 48
C) RECONCILIATION OF NO. OF SHARES S SHARE CAPITAL
OUTSTANDING. o of Sher (Tin lath) Hoot Stern 08 in tat
OUTSTANDING AS ON 01.041019 925210000 00 925218000 4(260.90
Add Share Capti81 Issued/ subsaibed dying the year
Less' Reductiori In Share Capital
OUTSTANDING AS ON 51.032020 925215000 46200.00 925210000
TERMS/RIGHTS ATTACHED TO EQUITY SHARES The company hes any one class of Emily Shares haL•ing pat value Mr 51- ma) end Is entided to on. role per sham.
, SHARES IN THE COMPANY HELD BY EACH g' SHAREHOLDER
HOLDING MORE THAN 5 PERCENT Of THE NUMBER OF SHARES
- President of MI.
• Life insurance Corporation of India
In No. In 9%) in No In (%)
Note No 15 EOUITY SHARE CAPITAL IT in lakh)
F-386
As at 31st December ,20281 As at 31st Mamb. 2020
(unaudtted) Reviewed lAtialtaril RWIT1CULARS
(971.57)
35560 05
(20013 65)
2200403
64958.69 4075559
(5693541) 14678.50
11122.48) (2245.671
1355202 159181.001
22034.03 86055.19
35560.05 27604.11
2-S
010 WRIER EQUITY
si CAPITAL RESERVE AS PER LAST BALANCE SHEET 2116624 2118824
h) GENERAL RESERVE
AS PER LAST BALANCE SHEET 0005.57 606597
ci MINE CLOSURE RESERVE
AS PER LAST BALANCE SHEET 230.00 163.00
Add- Diulu the year 75.00
Lest AD10011 refined doing the year
Less: Amount used during Si year
AS AT BALANCE SHEET DATE 230.00 238 00
d) CURRENCY FLUCTUATION RESERVE —
AS AT BALANCE SHEET DATE (2608.65)
MN Equity Component 0! Foreign Currency LOMA 1637.09
Less: AMOUllt reversed dudng the year
Less: Amount used during use year
AS AT BALANCE SHEET DATE
IN RETAINED EARNING
'5594
(2764 513)
4011.14 Lt. 'Dividend
Ii) Less :Tax on Dividend
BALANCE CARRIED FORWARD 15560.05 22004.03
• Capital Reserve Is created front the Grant receded Born the Clovernment el India during the approval of Fittenclal RwatiucturIng propneal by Ministry of Mow and out of Capital Profits over the yeenyTtils Reserve is not created out of Revenue Plaits of the Company. ^ Currency Fluctuation Rewrite Is not crested out of Revenue Profits of the Company.
TOTAL
Details of Retained Earning Profit 'Ross) after tax for the period es per Slalernerft of Profit and Loss other Comprehensnie IncorneftLoss) as per Statement of Peed and Loss (net solar) Total Comprehensive Income iftloss) for the Wood Balance brought forward
BALANCE AVAILABLE FOR APPROPRIATION
F-387
Al at 31st December 2026 As el 31st March. 2020
(Unaudited) Ri-ironed (Audited) PARTICULARS
(2458 73)
1575 00
(5448 73)
2082 .00
in I No 20 NON-CURRENT FINANCIAL LLABILIT 'BORROWINGS
As at 31sit December 3020 AS *531st Mortar, 2020
(unaudited) Reviewed (Audited) PART1CUU1RS
16660 .00
1705611 2264753
15410 00 15675.00
965000 0600 00
0000.10 060010
8147.00 21825.00
LONG TERM LOAN
• From Banker Els
- EOM Bent (Loan II)
(First panwessu charge on movable fixed ands, both present mid future 00 the Camthany. excluding COP and TOP)
- CBI
Tint Parl-pesiu charge on immovable teed assets of the Company located at MCP, both present and future excluding leasehold land/prepeny)
(First pari-passu chaise on immovable fixed eases of the Canon located Et MCP, both present end 'Wire , excluding leasehold land/property)
- tEl
- NDFC
(First periwassu charge on immenble aced insets of the Comptny located et MCP, both present NW Uwe . excluding leasehold Ithdprisperty)
-AXIS
(First peripessu chine on immovaN• lbwd assets of the Company located Si MCP. both prnant end future excluding kasahold land/properly)
- Federal Bent lErst pan-pony chans• on immovable fwed easels of the Company located or KCC, both present end More. excluding kesehold lend/prooentrl
- Unsecured
- Exim Bank 8003.00
TOTAL 84731.11 63817.53
IT In lac) An to Alitt At 00 .5500 00000, asidU'
(Unaudttedl Rnlevied (Alltatadi
043.53 843 53 Others (Compthsedion received horn Gout of Jharkhand for repair of township)
443.53 643.5 TOTAL
ale No 21 NON-CURRENT FINANCIAL UABILMES -0
(Tin lath) NM* No 21 NON CUR PROVISIONS
(801.73) (2430.73)
PROVISION FOR EMPLOYEE BENEFITS
I) PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 9032E5 1562032
Motions during the you 75.00
Amount ined during the year 1087.65
CLOSING BALANCE 0107330 003208
(Refer Note No. 39 General Notes tel Accounts Point No. 20)
8215.03
01 PROVISION FOR GRANDY
AS PER LAST BALANCE SHEET
Addthons during the year
Amount rimers-Wed duing the year
CLOSING BALANCE
TOTAL
F-388
PARTICULARS
As M 310 December .2020 Al at 31st Mock. 2020
(Unaudited( Fftvlewed (Audited)
42310.73 0574096 TOTAL
(Tin lath/ ate No 24 CURRENT FINANCIAL LIABILITIES -TRADE PAYABLE
PARTICULARS
As a131et December (1010 As at 3lat March. 2020
(Unaudited) Reviewed (AGO
TOTAL 161131.20 23374.41
Total outslending dues of micro entreprises and small enterprises
TOW outstanding dues of orators other than mkro en0erPenes end smell enterprises
733.04 95180
33412.02 15550 26
25 CURRENT FINANCIAL LIABILITIES OTHERS
As at 31st December 9020 As st 3151 March. 1020
(Unaudited) Reviewed (ALKIIINI)
I) Inherit accrued but nal due on borrovAnge & tenn Naas 46597 005,06
.3) Unpeid dividend 15,00 20,31
ail Deposits/ Retention money 6993.48 636134
iv) COW liabilities 15)2,10 1694 61
90W3 11 5581.11
No 25 OTHER CURS! MT LIABIUTI
I) stalartory dues peyables 5235.60 5763.20
NI Advanoes from Customers 5470.50 310592
191 sundry Credbrs Others 9372.53 6113 74
TOTAL 21067.72 16602,65
We No 23 CURRENT FINANCIAL LIABILITIES - BORRO NOS (1 in lath)
PARTICULARS
40 11 31st Dezember .7020 turn at Mat March, 2010
(Unaudited) Reviewed (Audited)
SHORT TERM LOANS
• Cash Credit- From Bob) Fin 4000.48 1302341
• WC01.- ROM Benton Fin 16300.00
- secured (Secured by hypotheation of Stock-In-Tred9Slores 5 Spare Pans and Book Debts. Oath preset and future of the Company)
- Working Capita/ Term Loan (Unsew red) - Aids Bank 4550.00 22000.03
- NONE kkahndra Bank - 0020.02
• HC Bank 10500.00
1250.00
- UBI 1000000 1250.00
LONG TERM LOANS
• Due m next 1 year
EXJM Bank (Loan 11 207625 003316
- EXIM Bank (Loon III 0000 00 610039
-A9cs Sank 250000 8105.00
• HDFC Bank 750.00 600.50
-US' Bark 300.00 200 .00
• EV ECU 2020.00
- Federal Rens 3322.00
• EXIM Bank 2000.00
F-389
e No n CURRENT - PROVISIO n lath)
PARTICULARS
As et 31st December .2020 Ass 31s0 march, 2020
(Unwanted) Reviewed (Audited)
el PROVISION FOR EMPLOYEE BENEFITS
I) PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 1503.85 1903 85
Additions during the year
Amain used during the year an 07
CLOSING BALANCE 1593.86 1593.85
PROVISION FOR GRATUITY
AS PER LAST BALANCE SKEET (2831.41) (2500.80)
AddMens dming the year 2040
Amount used during the year
CLOSING BALANCE (2E31.41) (2631.41)
Di) PROVISION FOR LEAVE TRAVEL CONCESSION (LTC)
AS PER LAST BALANCE SHEET 168.03 171.93
Additions during the year 2510
Amount Lead during the year
CLOSING BALANCE 198.03 Ind]
W) PROVISION FOR PRWINCENTNE
AS PER LAST BALANCE SHEET 1145.03 1727.00
Addlions during the yew 176.00
Amon used clvrIng the year 582.00
cLosaia BALANCE 1321.00 1145.03
I) PROVISION FOR WAGE REVISION
AS PER LAST BALANCE SHEET 1670.87 429827
Adonons dung the yew
Amounl used during the year 0.00 2370 40
CLOSING BALANCE 1126.07 1878117
OTHERS
I) DIVIDEND
AS PER LAST BALANCE SHEET
Additions durum the year 0.00 4811 14
.411101111i LUIS ailing the year
CLOSING BALANCE
ID TAX ON DIVIDEND
AS PER LAST BALANCE SHEET
Adddions then; the year 085.94
Minn used dud ru the year 088.94
CLOSING BALANCE
1011.14
1010.50
320.40
1235.75 107829
Ii)) PROVISION -OTHERS
AS PER LAST BALANCE SHEET
1075.20
Addition s dung the year 157.65
Amount used during the yr 0.16
CLOSING BALANCE
TOTAL
3306.12 3082413
(Rent Note No. 39 General Notes on Accounts Pon No 10428)
ot. No n CURRENT TAX LLABIUTIES (Net)
lath)
As st 31st December 3020 As M 31s1 March. 2020 PARTICULARS
(Unedited) Reviewed (Audnedi
Addition during the year Lest: Refund prtaInIng to !Radler years Leas Aitonce Inosme Tax & IDS
382280
Current Tu Llabillne (NM el Advance Tax & TOSI
6331.00
F-390
2,2
lash) • No 20 REVENUE FROM OPEPA110
PARTICULARS
or the Months ended Mat Daember • 2020
(Unaudited) Iltalwad
For ta year 31 March. 2020 (Ml ted)
5878295 34187 32 6832509 45129 33
SALE OF PRODUCTS • DomesbC • Export
Less : Discoal 5 Rebate SALES (Net of Discounts) (Al
SALE OF SERVICES (B)
125108.84 9031565
125105.84 80318.
78.55 310.79
OTHER OPERATING INCOME (C) 1.15 00 Scrap -interest horn Customers
aterest from Contractors egotist mobihzation advances for minim operations - Peaky 8 Liquidated Damages Las Refunded during the year
514.00 22054
2.313 115.11
58 99 25249
1920.38
68901 00.69 1E150.87
TOTAL IC) 126458 .81
59160 2.09
120452.05 831852 TOTAL (AUElit)
(2 in lahl Mae ni, T• v•nz-n 4••••••
For the Nine Months mad 3100 For the yam ended 3101 Mama 2020 PAR11CULARS December . 2020 (Audited'
(Unaudited( Thailand
-Claims Received 3.42 850
- Interest from Tarn Deposits 32.79 29.53
- interest • gars 3.16 092.27
• Proill on ate of Assets - •
- Profit on Fag Value GI investment 039 0.83
• Others 1542.19 2384.08
- Provisions not required written back 0 981.89 2250.83
TOTAL 255343 5495.32
Details ol Provisions not rocalred written back I (Refit Note No.39 General Naas on Amounts Pant No.111
Bad and doubtful Debts,advanceadepositt IS Sims 000 55.57
Excess provisions on account oithorlaim.nommoving,obselote (0.011 266.54 & insurance Stoves & Spares and finished goods
PliTiSi011 fit Dizcartled Assets no lofty?"' required Prey Wain bark for feasibility study of Concentrator pant at P27.46 MCP Provision for CSR no tonon required argon Back
-
Provision for Interest on MSME 224.85 264.01
Provision for MP Rural infreMacture 8 Road Development Tax . a Water chimes Excess Provision carted I or Transportation of Copper 17058 Concentrate horn MCC to load port ON Liability Wntten Back for S.Crediton. SD 6 DAD mire than 75590 846 59 5 years and Others TOTAL 901.07 2280.83
F-391
Note No 31 COST OF MATERIALS CONSUMED
PARTICULARS
Forties Nine Month. wad 31st December. 2020
(Unaudited) Reviewed
(Tin lath)
For the par ended 31st March, 2020 (Awned)
New Materiels Consumed
Van odor. Raised Dana Mint DemblImen1 161.07 144.95
TOTAL 181.07 525-34
(Tin lath)
Font- Nine Month. ended 3151 December • 202O
(Unaudited) FallVitYlOCI
For the 'rescinded 3196 March, 2020 (Audited)
A OPENING STOCK: Fhished Gads 63.00 1176.03
Semi-Finished and In-Process 54456 03 55340.42
TOTAL OPENING STOCK 64539.03 50425.45
B CLOSING STOCK: Mailed Goods 03.00 8300
Seni-Finished end In-Process 3193822 6445603
TOTAL CLOSING STOCK 32021.22 64539.03
(INCREASE)/ DECREASE (A-OS 32517.81 (5113.511
Tin LAM now no ...i cairmil cc. Drama,. F-n.r......-
PARTICULARS
for the Nina month. ended 31s0 FIX the year ended 31.1 March, 2020 December . 2929
(Unaudited] Reviewed (Audited)
Salaries, Wages 8 Allowances 14964.54 1100624
Bonus/Ex-prananerlamenCe Related Pay 202.53 104.00
Contribution to PIOViNflt 8 Other Funds 1456.34 210805
Mennen 8 Staff Welfare EXPSIMS 894.94 1568.12
Greatly &Leave ErnasNact 2043.63 297.20
TOTAL 19521.96 25952.31
Explanatory Note: - The detail of Remuneration peinpayable to Cirectors as 'nada in above payments are as blows: -
ii I Sanas 8 Allowances 15284 153.84
6 Contnnuan to Pradent & other Facts 13.18 13.18
Iii) Rambinsement of medal Expenses 1.05 1.03
Fe) Lave Encashment 32.83 3251
1 Gr'GRY Paid 20.00 20.00
vli Other Been's 29.63 29.58
TOTAL 250.59 250.08
In oration the Wholaime Directors are sawed the use of convoy car for private purpose and have Men provided nth residential ammodnan as per leas of lair appointment / Government guidelines and the charges are recovered at the also presaibed bribe Government_
F-392
TOTAL (A•13) 20178.00 21081.08
PARTICULARS
Forth. lane Months ended 310 DeWitt!, 2020
(Unaudited) Reviewed
Forth. year eaded 31s1 March, 2020 (Padded)
403) 92
44061
350.35
3210.50
21233
310523
1707367 25271 73
1707307 25271.73
O. DEPRECIADON Depredation for the year Less. Depreciallan transferred to Mine Development Expenditure SUB TOTAL (A)
AMORTISAllON Amorthation dicks [Pe year • SUB TOTAL (B)
• Amortisation during the year Is In retatIon to the expenses Incurred on 111111H etich ITO under operatloodproduchon and does not Include expenditure on
prospecting of minerals in new mines MIL
Ne44 No 34 FINANCE COST
PARTICULARS
Form. Nine Months ended 31st December .2020
(UnaudIted) Reviewed
(To lalch)
For the year ended 31•1 Mack 2020 (Aid Ned )
- Interest on Cash credit - Others ( Including Term Learn)
1339.00 376452
2001.93 4039.06
TOTAL 5103.32 004129
Note He 35 DEPRECIATION AND AMORTISAllON EXPENSE It In lakh)
(7 In lath) OS* p.o 10 .1 prEss**
PARTICULARS
For the Nina Months ended 31.1 December , 2020
( audited) Reviewed
For the year ended 31st lunch. 2020 (Audited)
A. OTHER MANUFACTURING EXPENSES
- Snores .Sparn& Tools Consumed 434185 1010.82
- Consumption of Powtt. Foe A Wate4 0024.34 17757 59
• Royalty. Gess 0 Dacretal amount 5252.52 7717.04
- Contracbm1Job for Process e810.32 1674417
- Herding A Tranalledeaon 2017.32 267564
Eseenses fa Leasehold Land - 134.41 20301
SUB TOTAL IA) 30450 16 5501917
B. REPAIRS A MAINTENANCE El MAJOR OVERHAUL EXPENSES
• Balding 22 30 145 54
- Machinery 1940 21 400313
20560 817 77
SUB TOTAL (5) 2264.19 4087.14
C. ADM:N[300110N EXPENSES
-Insurance 400 04 21305
8390 13167
- Rates and TeXeS 270.51 1132.30
• Security Expenses 1041.02 004.42
-Traveling and Conveyance 11094 410.12
-Telephone Telex and Postage 6713 129.e9
-Advertisement and Publicity 45.34 24645
• Panting end Stationery 18.33 70.15
- Books & Palodiceb 0.54 1. el
- Consultancy Cherges • Indigeious 205.25 102615
-Loss on Sale of Assets(Net) 0.00 2.04
.p.170 D40teCre61) Fortis)) Exchange (03.33) -20.80
- - -Exchange Rote Variaeon (Net)
- Corporate Seal ReSpOMItibly etp.Sell 40.47 331.01
-1.fire Charges 130.03 280.03
- Audit Expanses (Refer detail below/ itt SI 1) 15.213 41.03
• Independent I:tractors Expenses 1320 12.75
- Bank charge 73.05 170.93
Other General Expenses - 015.0 124108
SUB TOTAL (C) 3071.47 6401-30
D. PROVISIONS (Refer detail below al 80 0) 591.37 15844.59
TOTAL 041340.0) 77.1) 8627196
F-393
Nate No 37 TAX EXPENSE For the Nine Months ended 3150
Elecambee 2020 tUrIlUdO•di Reviewed
(Ito Lath)
Forth. yew ended 31. March. 2020 (Audited)
CURRENT TAX Income Tax Prodeon Income Too r&osngttter6efyaS
Deferred Tent A.M.
TOTAL 347.15 3131,01
3832.00
3404.651
842.18
3295.83
Note No 35 OTHER EXPENSES T in lakhl
paw.'
PARTICULARS
For the NIn• Mordhs ended 31st December , 2020
(Oneuditeell Reviewed
Forth. year ended 31s0 March. 2020 (Audited)
Explanatory Note: • 1(0.0.11 of Audit Expenses onto. under •
0 Statutory Auditors
• Ststutory Audit Fen 0.60 10.20
-Tex Au. Fe. 3.30 5.16
in Gther Capacity 11.03 14.96
• Ralentorsernent of Eepenses 0.27 14.60 2.20 38.60
((Coal Auditors
-Cost Audit Fees 0.70
• RellIbUneMent of Emenees
li) Internal Auditors
0.01 0.01 0,47 1.17
- AUCIII FOOS
- FteltnialrieMent of expanses 065 035 164 2.19
TOTAL 15.26 41.011
23 Detail of Provisions ere as under •
Doubtful debts 177.60 0.31
Doubtful advances I dePesles 262
Provisions for °Pao.. /Non4reevIng Stores 1.05
Pro... for WIP & Finished Goods 18.331 80
PISS/MIS for Capital WO* In Progress 131.88
Provisions or Loss of Assets 0.00
Intern/ on MSMED 192.37 323.68
Prorteon for lAine Closure Expenditure 75.03
PrOVISIOrt for Loss of Joint Venture 27.64 -
ProviSlon footstool Subsidiary 3.76 18.35
TOTAL 591.37 18484.59
IT in lakld Now No ea or New cUMrKtnL.notonoua
For theNine Mon*. ended 3106 Oscomber • 2020
(Unsuditedi Reviewed
Forth. wax ended 31s0 March. 2020 (Audited)
Ali)
A0 11
BO)
BOO
Dews that will not be reclassified to ProfitIlLoill
11500001 (3'900.95) Actudd gain/loss recognised In the year sr employees '
Gratuity
TOTAL ledi() 1560.001 (3000.96)
Income Tax relating to Items that wig 000 6. reclassified to Prof% ((Loss)
377.62 706.20
TOTAL (AOC) 377.52 755.28
Ream that will te rechnsified to Profit( (L.. TOTAL (B(I))
Income Tax refuting to tterne that will In reClanified to P001151 Lae.) TOTAL (13(11))
r2,
F-394
NOTES TO CONDENSED INTERIM UNAUDITED STADALONE FINANCIAL STATEMENTS
39 GENERAL NOTES ON ACCOUNTS
1. CON11NGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)
(i) Contingent Liabilities: -
a. Claims against the company not acknowledged as debt :
9 months ended 31.12.2020
(!in lakh)
2019-20
(Z in lakh) i Disputed VAT / CST / Entry Tax 3516.76 3516.76 ii. Disputed Excise Duty 2947.97 2947.97 iii. Disputed Income Tax 23113.43 23113.43 iv. Other Demand 43634.72 39110.70
SUB-TOTAL (A) 73212.88 68688.86 b. Other money for which the company is contingently liable :
i Bank Guarantee 1534.33 2767.54 U. Letter of Credit 93.17 53.26 iii. Bill discounting - -
SUB-TOTAL (B) 1627.50 2820.80 GRAND TOTAL (A+B) 74840.38 71509.66
ii) Commitments:-
Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of advance and deposit) 67835.44 73913.51
2. During the nine months ended 31.12.2020, the company has made a provision amounting to 176.00 lakh (Previous Year Nil) in terms of DPE guidelines towards Performance Related
Pay payable to the executives which is shown under 'Employee Benefit Expense'.
3. Lease premium paid for land for mining purposes including payment for Net Present Value (NPV) of forest area paid to forest department is capitalized under the head Right to Use shown under Note No. 9(c) & 17(h).
4. The lease agreements of Kendadih and Rakha Mining Lease at ICC has been renewed and executed by the Govt of Jharkhand in respect of leasehold lands valid upto 02.06.2023 and 28.08.2021 respectively. In respect of Surda Mining Lease, the lease agreement has expired on 31.03.2020 and the company has applied for extension of the lease agreement with the Govt of Jharkhand. Govt of Jharkhand has issued Letter of Intent (L01) for extension of the lease vide letter dated 05.08.2020. Formal letter of extension of the lease is under active consideration of the Department of Mines & Geology, Govt of Jharkhand, Ranchi.
5. The commercial operation of Smelter, Refinery and Sulphuric Acid Plant at Khetri Copper Complex (KCC) were suspended since December 2008. The Company suffered loss on account of impairment of the said plants valued by an independent consultant in earlier years and consequently a total sum of 464.01 lakh was provided in the accounts for impairment loss in compliance with the guidelines of IND AS 36 on "Impairment of Assets" as on 31.12.2020. Total inventory valued 8.06 lakh (Previous Year 33.21 lakh) which remained as process material in the above Plant is included in the Inventory of the company. The management is of the opinion that such inventories consisting mainly of metal content and having realizable value at least equal to the amount at which they are stated.
F-395
6. The title deeds for Freehold and Leasehold Land and Building acquired in respect of Gujarat Copper Project (GCP) with book value of! 5365.75 lakh are yet to be executed (Previous year 5578.11 lakh).
7. At ICC, Pollution Control Plant under Package I & III amounting to 2100.50 lakh have not been capitalized for want of completion of trial / guarantee run as per terms of contract. As a matter of prudence, full provision for the same has been made in the accounts to take care of efflux of time over the years.
8. During the nine months ended 31.12.2020, the company has spent a sum of 46.47 lakh on account of Corporate Social Responsibility (CSR) expenses.
Amount spent during the year on:
Srl. No.
Particulars in cash In cash Yet to be paid Total
(i) Construction/acquisition of any asset - -
(ii) On purposes other than (i)above
! 46.47 lakh - Z46.47 lakh
9. Information related to Micro, Small and Medium Enterprises Development Act, 2006 as on 31.12.2020 is disclosed hereunder:
a) i) Principal amount remaining unpaid to any supplier at the end of the financial year
! 384.43 lakh
ii) Interest due on above ! 299.00 lakh b) Amount of interest paid by the buyer in terms of Section 16
of the Act, along with amount of payment made beyond the appointed date during the year
c) Amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the due date during the year) but without adding the interest specified under the Act
! 837.34 lakh
d) Amount of interest accrued and remaining unpaid at the end of the financial year
! 1136.34 lakh
e) Amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid to the Small enterprise, for the purpose of disallowance as a deductible expenditure under Section 23 of the Act
! NIL
The information has been given of such vendors to the extent they could be identified as "Micro and Small" enterprises on the basis of information available to the Company.
F-396
10. During the nine months ended 31.12.2020, the Company has written back old liabilities / provisions amounting to 981.69 lakh (Previous Year! 2280.83 lakh) in the accounts, the details of which are as under :-
SI. No.
PARTICULARS ? in lakh
REASONS FOR REVERSAL
1. Excess provision for doubtful debts no longer required is written back in TCP -! 0.04 lakh
0.04 The relevant amount of debts were recovered from the customers/parties and hence the provision for doubtful debts created in earlier years has been written back.
2. Excess provision for doubtful advances no longer required is written back in KCC -! 0.86 lakh
0.86 The relevant amount of advances were recovered from the parties and hence the provision for doubtful advances created in earlier years has been written back.
3. Excess provision for interest on MSME is written back in TCP - Z 0.07 lakh & MCP -! 224.81 lakh
224.88 Excess provision for interest on MSME created in earlier years has been written back.
4. Liability for unclaimed EMD, SD, Sundry Creditors & Advance from customers for more than 5 years written back at HO - Z 10.81 lakh, RSON - Z 39.66 lakh, MCP - Z 425.01 lakh, TCP - Z 0.65 lakh, RSOW - Z 64.03 lakh, RSOS - Z 26.23 lakh & RSOE -! 189.52 lakh
755.91 The unclaimed liability for EMD, SD & Sundry Creditors unmoved for more than 5 years has been written back
TOTAL 981.69
11. Management has not become aware of any instance of fraud by the company or any fraud on the company by its officers and employees during the current nine months ended 31.12.2020.
12. The Company has closed / suspended many of its mining operations located at various places, Fertilizer Plant at Khetri in different years due to their uneconomic operations. As per requirement of IND AS 105 on "Non-current Assets Held for Sale and Discontinued Operations" the following information for nine months ended 31.12.2020 are furnished:
(Z in lakh) Previous year fi ures in brackets)
MS8 GROUP OF MINES
RCP CCP DCP Fertilizer Plant
i) Initial disclosure event 1997 to 2001 2002 1994 2001 (Year of closure) 2003
H) Carrying amount of No separate 470.49 - - No separate Assets records (490.05) (-) (-) records are
Hi) Liabilities to be settled maintained 137.17 73.04 3.38 maintained (137.17) (73.04) (3.38)
iv) Amount of income - - - (-) (-) (-) (-)
v) Amount of expenses - 26.14* - - (-) (34.70) (-) (-)
vi) Gain on sale of assets - - (Included in iv above) (-) (-) (-) (-) *This is included in cash generated from operations In the Cash Flow Statement.
F-397
13. Since the company is primarily engaged in the business of manufacture and sale of copper products, the same is considered to be the only primary reportable business segment and accordingly has been reported. As the Company operates predominantly within the geographical limits of India, no secondary segment reporting has been considered as per IND AS 108 "Operating Segments".
14. Sales for the period include FOB value of Export Sales:-
2020-21 (9 months) 2019-20 Qty (MT) tin lakh Qty (MT) tin lakh
Anode Slime 4.600 649.58 25.040 1995.90 Copper Reverts 198.211 808.72 265.347 815.91 Copper Concentrate (CMT) 14118.833 66867.39 10647.339 43317.52 Total 68325.69 46129.33
15. In terms of IND AS 24 on "Related Party Disclosures":
The company does not have any Advances provided to its Subsidiary and Joint Venture Company as at 31.12.2020 except as is disclosed below:
Transactions with Related Party during the year and balance outstanding as on 31.12.2020 in lakh
Name of Related Party
Nature of Relationship
Type of Transaction
9 months ended Year ended 31.12.20 31.03.20
Chhattisgarh Copper Limited (CCL)
Subsidiary Investment in shares as on
33.30 18.50
Advances given as on
- 6.50
Name of Related Party
Nature of Relationship
Type of Transaction
9 months ended Year ended 31.12.20 31.03.20
Khanij Bidesh India Limited
(KABIL)
joint Venture Investment in shares as on
75.00 3.00
Advances given as on
72.00
The remuneration of Key Management Personnel are given below:
Particulars Key Management Personnel Total Remuneration For 9 months ended 31.12.20
Year ended 2019-20
FUNCTIONAL DIRECTORS
Receiving of Services
1. Sri Arun Kumar Shukla Chairman-cum-Managing Director
1.01.2020)
37.97 12.37 (wet.
0 2. Sri Santosh Sharma
Chairman-cum-Managing Director 44.31
(upto 31.12.2019) 3. Sri K D Diwan
Chairman-cum-Managing Director 1.55
(Arrear PRP)
4. Sri Anupam Anand Director (Personnel)
26.03 10.55 (upto 04.08.2019)
5. Sri S K Bhattacharya Director (Mining)
93.70 (upto 31.12.2019)
6. Sri S K Bandyopadhyay Director (Finance)
40.15 52.41
7. Sri Arun Kumar Shukla 35.70 Director (Operations)
- (upto 31.12.2019)
OTHER THAN FUNCTIONAL DIRECTORS 8. Sri CS Singh'
Company Secretary 36.24 51.28
F-398
INDEPENDENT DIRECTORS Sri Subhash Sharma - Date of appointment - 18.02.2018 Sri Pawan Kumar Dhawan - Date of appointment - 22.07.2019 Sri Balwinder Singh Canth - Date of appointment - 22.07.2019 Sri Kalyansundaram - Date of appointment - 22.07.2019
SI. No. Payment to Independent Directors For 9 months ended
31.12.2020
Year ended 31.03.2020
1. Sitting Fees 13.20 12.75
Balance Outstanding with Key Managerial Personnel as on 31.12.2020
SI. No. Particulars As on 31.12.2020
As on 31.03.2020
1. Amount payable Nil Nil 2. Amount receivable _ Nil Nil
16 In terms of IND AS 33 on Earning per are" torY months en e . . . Z in lakh)
BASIC DILUTED Profit / (Loss) After Tax 14678.50 14678.50
(-)56935.41 (-) 56935.41 Denominator used: Weighted average number of Equity Shares of Z 5/- 925218000 925218000 (Previous year Z 5/- each) outstanding during the period.
(925218000) (925218000)
Earning Per Share (Z) 1.587 1.587 (-)6.154 (-) 6.154
17. The Company has accounted for Deferred Tax in accordance with the guidelines of IND AS 12 on "Income Taxes" issued by The Institute of Chartered Accountants of India. The Deferred tax balances are set out below:-
Z in lakh) —.-...— .......__. ,.._.,. Particulars Deferred Tax
Asset/ (Liability) as at
01.04.2020
Credit/ (Charge)
during the nine months
ended 31.12.2020
Deferred Tax Asset/ (Liability)
as at 31.12.2020
Deferred Tax Asset :- Difference between provision made in accounts and claims made as per I. T Act
5864.22 3500.95 9365.17
5864.22 3500.95 9365.17 Deferred Tax Liability :- Difference between net book value of depreciable capital assets vis-a-vis WDV as per IT Act
(1914.43) (16.10) (1930.53)
(1914.43) (16.10) (1930.53)
Deferred Tax Asset (Net) - Recognised in Statement of Profit 64 Loss
3949.79 3484.85 7434.64
Deferred Tax Asset (Net) - Defined Benefit Plan - Recognised in OCI
1341.02 377.52 1718.54
Total Deferred Tax Asset (Net) 5290.81 3862.37 9153.18
11 0
!Sri-
F-399
18. PROVISIONS FOR CONTINGENCIES (For 9 months ended 31.12.2020 : - (!in lakh)
Particulars Discarded Fixed Assets
Capital WIP & Advance
Mines Development Expenditure
Others TOTAL
Carrying amount as at 01.04.2020
1838.56 3392.91 4664.86 32274.97 42171.30
Amount provided - during the year
- - 2161.51 2161.51
Amounts utilized against provision
- - 1.33 1.33
Carrying amount as at 31.03.2020
1838.56 3392.91 4664.86 34435.15 44331.48
19. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS IN TERMS OF Ind AS 19:
The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded through Life Insurance Corporation of India, SBI Life Insurance Co. Ltd. and India First Life Insurance and are managed by separate trust. The Company has also funded through Life Insurance Corporation of India and SBI Life Insurance Co. Ltd towards leave encashment. Expenses recognized in Statement of Profit & Loss and Other Comprehensive Income for 9 months ended 31.12.2020 amounting to Z 3584.66 lakh in respect of Gratuity and Leave Encashment is on estimation basis based on the actuarial valuation report of the preceding year.
21. With effect from April, 2019, the company has adopted Ind AS 116. However, since the company has no lease liabilities at present, Ind AS 116 has no financial impact on the accounts of the company during the 9 months ended 31.12.2020.
22. INFORMATION IN RESPECT OF SUBSIDIARY, ASSOCIATE & JOINT VENTURE (FORM AOC 1) (Pursuant to Section 129(3) of Companies Act 2013 read with Rule 5 of Companies (Accounts) Rules, 2014)
PART — A - SUBSIDIARY
SI. No.
Particulars 9 months ended 31.12.2020
1 Name of the subsidiary Chhattisgarh Copper Limited (CCL)
2 Reporting period for the subsidiary concerned, if different from the holding company's reporting period
NA
3 Reporting currency INR 4 Equity Share Capital Z 45,00,000 5 Other equity Z (38,88,139) 6 Total assets Z 8,96,515 7 Total liabilities Z 2,84,654 8 Investments Nil 9 Total Income from operations (net) Nil 10 Profit/(Loss) from ordinary activities before tax Z (2,33,805) 11 Tax expense Nil 12 Profit/(Loss) from ordinary activities after tax Z (2,33,805) 13 Proposed Dividend Nil 14 % of shareholding 74%
F-400
Note: 1. CCL is yet to commence operations. 2. The subsidiary has neither been liquidated nor sold during the nine months ended
31.12.2020.
PART - B - ASSOCIATE/ JOINT VENTURE
SI. No.
Particulars 9 months ended 31.12.2020
1 Name of the Associate/joint Venture Khanij Bidesh India Limited (KABIL)
2 Latest audited Balance Sheet Date 31.03.2020 3 Date on which the Associate/joint Venture was
associated or acquired 01.08.2019
4 Shares of Associate/joint Venture held by the company on the year end Nos. 7,50,000 Amount of investment in Associate/joint Venture Z 75,00,000 Extent of holding (c/o) 30%
5 Description of how there is significant influence Controlling 30% shareholding
6 Reason why the Associate/joint Venture is not consolidated
Not applicable
7 Net Worth attributable to shareholding as per latest audited Balance Sheet
Z 47,35,848
8 Profit/(Loss) for the 9 months ended 31.12.2020 Not applicable Considered in consolidation Not applicable Not considered in consolidation Not applicable
Note: 1. KABIL is yet to commence operations. 2. The associate/joint venture has neither been liquidated nor sold during the year.
Pursuant to Section 186(4) of the Companies Act, 2013, details of investment made to subsidiary & joint venture have been shown under Note No. 5. However no loan have been given to the subsidiary and joint venture during the 9 months period ended 31.12.2020.
23. The income tax expense for the year can be reconciled to the accounting profit as follows : Z in lakh
9 months ended 31.12.2020
Year ended 31.03.2020
Profit / (Loss) before Tax 15045.21 (53771.43) Income Tax expense calculated at 25.168% 3786.58 - Effect of Deferred Tax balances due to the change in income tax rates
1534.21
Income Tax effect of earlier years - 842.18
Others (net) 45.42 761.62 Income Tax expense recognized in profit or loss 3832.00 3138.01
The company elected to exercise the option permitted under Section 115BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment Act, 2019). Accordingly the company has recognised Provision for Income Tax for the 9 months ended 31.12.2020 and remeasured its deferred tax assets/(liabilities) basis the rates prescribed in the said section.
41,e-
2-
F-401
24. The value of assets, other than fixed assets and non-current assets, have realizable value at least equal to the amount at which they are stated.
25. Gujarat Copper Project of the Company consists of three units namely, Anode furnace (Smelter), Refinery and Kaldo Furnace having aggregate book value of Z 22704.69 lakh as at 31.12.2020. The Anode Furnace and Refinery unit has been commissioned in October 2016 while Kaldo unit is commissioned on 25.05.2020. Since commissioning, the plant is being operated at a sub optimal level for want of feed stock. GCP being a secondary smelter, the feed stock are copper scrap, copper blister, liberator cathode etc. The Company has not been able to operate profitably the plant due to various constraints. However, the company has floated an 'Expression of Interest for Long Term Leasing or Outright Sale of the Gujarat Copper Project located at Bharuch'.
F-402
26. Financial instrument
1. Derivatives not designated as hedging instruments The Company uses Commodity Futures Contracts to manage its commodity price risk . The Commodity Futures Contracts are not designated as hedging instnannets and are entered into for periods consistent with commodity price risk exposure of the underlying transactions, generaly from one to four months. However during the nine month ended 31st December 2020, the Cornpany has not entered into any Commodity Futures Contract
The Company uses foreign exchange forward contacts to manage sonic of Its transaction exposures. The foreign exchange forward contracts are not designated as cash flow hedges arid are entered Into for periods consistent with foreign currency exposure of the underlying transactions, generaly from we to four months.
Commodity price risk
The Company purchases capper blister/ anode on an ongoing basis for Its operating activities in its Gujarat Copper Project (GCP) plant for the production of cathode. To hedge itself against the yolataity in LME copper prizes In the International market has led to the decision to enter into commodity future contracts. Haweverduring the nine month ended 31st December 2020, the Company has not purchased any such copper bfisterl anode for Its gent in GCP.
These contracts, which commenced in August 2016, are expected to reduce the volatility attributable to mice fluctuations of copper. Hedging the price votatitry of copper purchases lain accedence with the Risk Management Poky approved by the Board of Directors. The hedging relationships are for a period between 1 and 4 months based on existing purchase agreements. The Company designated only the spoktospot movement of the entire commodity purchase price as the hedged deli It has been decided by the company not to follow the hedge aoocunting for these instruments.
As at 31st December 2020, the fair value of the open position of commodity future contracts is nil.
2. Financial Instruments by Categories The carrying value and fair yedue of financial instruments by categories were as follows: Set out below, is a comparison by class of the carrying amounts and fair value of the Campania financial Mstruments, other than those with caning amounts that are reasonable approximations of Fair values:
Amount In T lath
Particulars Total carrying value seat
December 31,2020 Total carrying value as at March
31,2020 Fair Value as at
December 31,2020 Fat Value as at Match 31,2020
Financial Assets at FV through Statement of Profit Oil oss
Mutual Funds 7.84 7.84 9.87 9.48
Derivatives not designated as hedges Future Contract Receivable on commodity
Total of Financial Assets 7.84 7.84 9.87 9.48
Financial Liabilities
DerivaUves not designated as hedges
Forward Cover Contract Liability
Total of Financial Liabilities
3, The Management considered the Service fees of Rs 15 lath paid an the Exim Bank Tam loan amounting to Rs. 30000 lath drawn on 29.05.2018 as immaterial, as the amount of service fee %vas only 0.012% of the Turnover for 9 months ended 31.12.2020 of the company and hence the same was not considered as a transaction cost in terms of fair valuation at Millet recognition under INCAS 109, Further, the Management assessed that for the purpose of INC AS 109, the carrying value of loan is considered as its fair value as no loan could be provided at a rate lower that the rate of interest of Exim Bank loan for similar terms and conditions of the loan at that point of time.
Simiady, the Management considered the total of Upfront fees 8 Other charges of Rs 245.33 lath paid on the 581ECB loan amounting to Rs. 17734.75 takh drawn during My 2018 to January 2019 as Immaterial, as the amount of such fees/charges was only 0.196% of the Turnover for 9 months ended 31.12.2020 of the company and hence the same was not considered as a transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further, the Management assessed that for the purpose of INC AS 109. the carrying value of loan Is considered as its lair value as no loan could be provided at a rate lower that the rare of Interest of SSIECB loan for simfiar terms and conditions of the loan at that point of tine.
The Management assessed that Cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liablities approximate their carrying amounts largely due to the short-term maturities of these Instruments.
The fair value of the financial assets and kabilities is Included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or fiquidation sale. The following methods and assumptions were used to estimate the fair values:
The Company enters into derivative financial instruments with various counterparties, principally with financial Institutions having Investment grade credit ratings. Foreign exchange forward contracts and commodity futures contracts are valued using valuation techniques, which employs the use of market observable inputs. The most frequently applied valuation techniques lackede forward pdoing 4. Fair Value Hierarchy
. Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) In active markets. Level 2- Level 2 hierarchy includes financial instruments measured using inputs other than quoted prices Included within Level 1 that are observable for the asset or lability, either directly (i.e. 83
prices) or Indirectly (i.e. dotted from prices). • Level 3' Level 3 hierarchy includes financial instruments measured using Inputs that are not based on observable market data (unobservable inputs).
39k--
F-403
The following table presents fair value hierarchy of assets and liabilities measured at fair value Amount In ? lakh )
Particulars.- .,4!"., D te of V !widen e I . .. .,...,:a,„ L il Le vel 2-
c:r.
L - 3 otal
Financial Assets at FV through Statement of Profit 8, Loss
Non-derivative financial assets Mutual funds 31-Dec-2020 9.87 9.87
Derivative financial assets Future Contract Receivable on commodity 31-Dec-2020
Liabilities measured at fair value: Derivative financial liabilities
Forward Cover Contract Liability 31-Dec-2020
Assets measured at FV through CICI 31-Dec-2020 -
Amount In lakh
Pa caters wr,- --,,,, 'Date of Valuation - a. ,- — , Level ,-----e. -:.^,-• Level 2 --,,-. -,',---t---. Level 3 ,---rPr ,MalaTotalra Financial Assets at FV through Statement of Profit & Loss
Non-derivative financial assets Mutual funds 31-Mar-2020 9.48 9.48
Derivative financial assets Future Contract Receivable on commodiW 31-Mar2020
Liabilities measured at fair value: Derivative financial liabilities
Forward Cover Contract Liability 314tar-2020
Assets measured at FV through OCI 31-mar-2020
5. Financial Risk Management Financial risk factors
The Companys activities expose it to a variety of financial risks: market risk, credit risk arid liquidity risk. The Comp nys primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.
RISK Exposure arising from Measurement Management'
Market risk- Foreign Exchange
Future commercial transactions, Recognised
financial assets and financial liabifilies
Sensitivity analysis Forward foreign exchange contracts and
natural hedge as sales are also demoniated in foreign excehange.
Market-Commodity Price Risk Purchase of Copper Price Sensitivity Commodity Futures Contract
Credit risk Trade receivables Ageing analysis Sales are mainly done against Advance or
Letters of Credit
Liquidity nsk Borrowings and other
liabilities Roffing cash flow forecasts Cash flow management
F-404
Impact on profit before taxiceignig Rtritr:March 312020 December 31, 2020 Particulars rrn,
2.783.20 2,407.22 Increase by 5% (2,783.20) (2,407.22) Decrease by 5 %
a) Market Risk I) Foreign Currency Risk The Company operates at international level which exposes the company to foreign currency risk arising from foriegn currency transaction primarily from Imports,exports and foreign currency borrowing. Foreign currency risk arises from future commercial transactions and recognised assets and liabilities denominated in a currency other than INR as on reporting date.
s of December 312020 )
Particulars
ramount In lath Rs. In Iskhr.)):IRMBISOMMIR
Cash & cash equivalents Trade Receivables EXPORT 6589.01
Trade Payables Loans
4814436
Others In any) -41555.35 Net Assets/ (-) Liabilities
Amount in lakh as of March 31.2020)
Particulars ji,. Rs. In lakhirrrcesstrgemgm,.
Cash 8 cash equivalents Trade Receivables EXPORT
7114.00
Trade Payables -55664.08 Loans Others (if any) 48550.08 Net Assets/ (.) Liabilities
Sensitivity The sensitivity of profit or loss to changes in exchange rate arises mainly from foreign currency denominated financial instrument.
In Commodity Price Risk The company's exposure to Commodity price from copper price fluctuation in International market does root arise a the company hedges at its imports through Future contracts at LME.
b) Credit Risk Credit risk refers to the risk of default on its obligation by the Debtors resulting in a financiM loss. The company sells majority of its products either against Advance from Customers or Letters of Credit. Accordingly, credit risk from Trade receivables has not been cosidered as credit risk.
Credit risk exposure An anahrsis of age of Trade receivables at each reporting date is summarized as follows: A:MUM In Mkh
Particulars 31-Dec-20 31•Mar-20
Gross Gross
Not past due Past not more than Mx months 6360.07 5712.45
Past due mom than six months but not more than one year 6040.11 553.2
More than one year 1782.59 2910.21
Total 14182.77 9175.86
Less Allowances for Bad a Doubtful Debts 1064.08 886.51
Net Debtors 13118.69 8289.35
Customer credit risk Is managed by each business unit subject to the Cornparhes established Marketing policy, procedures and control relating to customer credit risk management Outstanding customer receivables are regularly monitored and any shipments to major customers are generally covered by tatters of credit or other forms of great Insurance. The maximum exposure to credit risk at the reporting date is Rs 1064.08 lakh for which ful provision has been made in the accounts as disclosed In Note No 12.
Other financial assets Credit risk relating to cash and cash equivalents Is considered negligible because our counterparties are scheduled banks. We consider the credit quality of Term deposits with such banks as good as these banks are under the regulariory framework of Reserve Bank of India. We review these banking relationshMs on an ongoing basis.
LMuidity Risk Ott liquidity needs are monitored on the basis of monthly and yearly projections. The company's principal sources of liquidity are cash and cash equivalents and cash generated MOM operations.
We manage our liquidly needs by continuously monitoring cash inflows and by striving to maintain adequate cash and cash equivalents. Net cash requirements are compared to available cash in
Short term Gquidity requirements consists mainly of Loans, Sundry am:Mors, Expense payable. Employee dues arising during the normal course of businesses of each reposing date. We strive to order to determine any shortfall.
maintain a sufficient balance in trace and cash equivalents to meet our short term liquidity regUrements.
The table below provides detals regarding the contractual maturities of financial liablities. The table has been drawn up based on the undisclosed cash flows of friancial liabigies based on the
eeriestdate on which the company can be required to pay. of December 31 2020
Months year Particulars On Demand 1-3 years 3.5 years 5-7 years Total
remount in! lakh as
Less than 3 3 months to 1
Shm1 term borrowings (cash credit) 4000.48 0.00 0.00 0.00 0.00 0.130 4000 48
Short term borrovAnos (Others) 0.00 7050.03 7500.00 0.00 0.00 0.00 14550.00
Lona Term ROWOWinOS 0.00 250.00 27001.00 68043.00 13197.36 0.013 10849136
Total 4000.48 7300.00 34501.00 68043.00 13197.36 0.00 127041.84
in lakh as of M rch 31 2020)
Particulars On Demand Less than 3 3 months to 1
months year 1-3 years 3-5 years Total
Short term borrowings (cash credit) 13603.41 13603.41
Short term borrowings (Others) 36806.00 I8500.00 55300.00
Long Term Borrowings 251500 10515.78 01548.20 12225.00 • 86464.05
Total 13603.41 38975.00 30015.79 61548.29 12,225.00 - 156367.49 - n ....cr..- ... on nnionnioce rins n 73 05 2020 the schediiino of Man instalme Is has been given as per approval
NB: Under RBI Notification No. RBll201S-ZO1t* osteo hum. received from banks under COVID-19- Regulatory Package.
6. Capital Management For the purpose of the Company's capital management, capital irmludes issued equity capital and al other equity reserves attributable to the Company. The primary objective of the Company's
capital management Is to martinis° the shareholder value.
F-405
27. Copper ore tailing (COT) beneficiation plant was set up at MCP unit for extraction of valuable minerals and metals from copper ore tails with a capacity of 10000 tonnes per day (TPD) at an estimated cost of 20000 lakh. The intermittent trial run failed on number of occasions (chockage/ spillage, stoppages, cleaning etc) and the quality and quantity of products achieved at various stages are not as per the parameters envisaged in contract agreement. A preliminary notice was issued to the party to complete the project and commission the same. The party agreed to commission the plant, but the progress of the work at site was stopped due to lockdown for COVID-19 pandemic. The company has extended the timeline upto 31.08.2020 for supply, erection of the thickener and commission of the plant. But the party failed to execute the contract and the contract got terminated with efflux of time.
28. Consequent upon the Judgment of Common Cause dated 02.08.2017, which is applicable only to the mining leases of iron and manganese ore, passed by the Apex court in the case of Common Cause Vs U01 and others, a demand of 4353.78 lakh was raised by the District Mining Officer of Jamshedpur for running the Surda mine without valid environment clearance (EC) although Surda mine has a valid mining lease, forest clearance and it has adhered to the terms of approved mining plan and it was working on valid Consent to Operate. Based on the Revision Application filed by the company, the Revisional Authority of the Ministry of Mines, after hearing at length both parties had issued specific direction against the District Mining Officer (DMO) not to take any coercive measures in terms of recovery of the said demand. On revision of demand from 4353.78 lakh to 12690.49 lakh by the office of the District Mining Officer and subsequently revised to 92940.06 lakh by the State Government, the company again appealed before the Revisional Authority and hearing was held on 14.11.2019 and interim stay is granted by the Revisional Authority till the next date of hearing. Since at present mining leases of copper ore are not included under Common Cause Judgement, the Management, based on the legal opinion, is of the view that the same has not to be shown as Contingent Liability as on 31.12.2020.
29. The cost of production per unit has gone up owing to low volume of production during the nine months ended 31.12.2020 due to measures taken by the Government of India to contain COVID-19 pandemic situation prevalent in the country. Post unlocking of the lockdown, the Company's operations are gradually stabilizing. The Company has considered the possible effects that may result from COVID-19 in the preparation of these financial results including recoverability of carrying amounts of financial and non-financial assets. The Company will continue to closely monitor any material changes arising out of future economic conditions and the resultant impact on its business.
30. The company has not changed any accounting policies during preparation of Condensed Interim Unaudited Financial Statements for Nine months ended 315t December 2020 w.r.t to accounting policies of previous financial year. This Condensed Interim Unaudited Financial Statements has been prepared by the company for internal use with regards to the proposed Qualified Institutional Placement of equity share of the Group. Accordingly , this financial statement should not be used, referred to or distributed for any other purpose.
31. The previous year's figures are not comparable with the current period figures since the current period consists of 9 months. The previous year's figures have been regrouped / rearranged, wherever necessary.
47
F-406
CHATURVEDI & CO. CHARTERED ACCOUNTANTS
Park Centre, 24 Park Street, Kolkata - 700 014. Phone: 2229 2229, 4601 2507
chaturvedikol@hotmaitcrint chatuniedisctitlahno.co in (PIA Kialkata. Branches at: Delhi. Altnnbai. Chennai . Lueknina)
Report on Review of the Condensed Consolidated Interim Financial Statements
To The Board of Directors of Hindustan Copper Limited Kolkata
Introduction 1) We have reviewed the accompanying Condensed Consolidated Unaudited Balance Sheet
of Hindustan Copper Limited (hereinafter referred to as "The Parent Company) and its one subsidiary company (Parent company and Subsidiary together referred to as "The Group") and its jointly controlled entity as on 31st December 2020 and the related Condensed Consolidated Unaudited Profit and Loss Account, Condensed Consolidated Unaudited Cash Flows Statement and Condensed Consolidated Unaudited Statement of Changes in Equity of the Company for the nine months period then ended, and a summary of significant accounting policies and other respective select explanatory notes (hereinafter referred to as the "Condensed 'Consolidated Unaudited Interim Financial Statements").
2) The Parent's management is responsible for the preparation and fair presentation of these Condensed Consolidated Unaudited Interim Financial Statements in accordance with the measurement and recognition principles of Indian Accounting Standard 34-"Interim Financial Reporting" prescribed under Section 133 of Companies Act, 2013 tread with relevant rules issued there-under and other accounting principles generally accepted in India. The Condensed Consolidated Unaudited Interim Financial Statements are the responsibility of the Company's management and have been approved by the Board of Directors. Our responsibility is to express a conclusion on this Condensed Consolidated Unaudited Interim Financial Statements based on our review.
Scope of Review 3) We conducted our review in accordance with the Standard on Review Engagements
(SRE) 2410- "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Institute of Chartered Accountants of India. A review of interim financial information consists of making inquiries, primarily of people responsible for financial and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable us to obtain
Page 1 of 3
F-407
assurance that we would become aware of all significant matters that can be identified in tot,
an audit Accordingly, we do not express an audit opinion.
The Group 4) The Condensed Consolidated Unaudited Interim Financial Statements include the
unaudited interim financials of its one Subsidiary Company named as "Chhattisgarh Copper Limited" (74% holding) which have been reviewed by Other auditors within the Group and unaudited results of its one Joint Venture company named as %hang Bidesh India Limited" (30% holding) duly certified by the Parent's management for the nine
months period ended 31st December 2020.
Emphasis of Matter 5) Without qualifying our conclusion, we draw attention to the following matters of the
Parent Company: a) Title deeds for freehold and leasehold land and building acquired in respect of
Gujarat Copper Project (GCP) with book value of INR 5365.75 Lakh are yet to be executed in favour of the company. Title deeds for freehold and leasehold lands or other evidences of title in respect of lands at KCC,MCP and ICC as stated by the management is in the process of the reconciliation with financial records; and
b) Gujarat Copper project valuing INR 27559.37 Lakh where the project is not operating due to various constraints, viability assessment needs to be done to evaluate and adjust for possible impairment loss, if any.
Our conclusion is not modified in respect of these matters.
Conclusion 6) Based on our review conducted as above, subject to limitation in scope as mentioned in
paragraph 3 & 4 above, nothing has come to our attention that causes us to believe that the accompanying Condensed Consolidated Unaudited Interim Financial Statements are not prepared, in all material respects, in accordance with the recognition and measurement principles of Indian Accounting Standard 34-interim Financial Reporting" prescribed under Section 133 of Companies Act, 2013 read with relevant rules issued there-under and other accounting principles generally accepted in India.
Limitation in Scope 7) We did not review the interim financial information/financial results of its Subsidiary
Company included in the Condensed Consolidated Unaudited Interim Financial Statements whose interim financial information / financial results reflect the total revenue of Nil, total net loss after tax of INR 0.87 Lakh and INR 10.32 Lakh and total comprehensive loss of INR 0.87 Lakh and INR 10.32 Lakh for the quarter and nine
Page 2 of 3
F-408
Restriction on Distribution and Use
8) This review report is issued for the internal use of the Board of Directors of tre Company for the purpose of inclusion in the Praliminary Placement Document and the Placement Document In be filed with the Securities and Exchange Bowd of India,
Registrar of Companies and Stock Exchanges with regards to the proposed Qualified Institutional Placement of equity share of the Company as referred to in Note No39 (31) e the Condensed Consolidated Unaudited Interim Financial Statements end should not be used by any other person for any other purpose. We neither accept not assume any duty or liabilifty for any other purpose or to any other party to whom our report is shown Olin whose hands ft may come without our prior consent in writing
For Cnaturvedl & Co.
Chartered Accountants
Firm Registration No.:-302137E
RAC Nang a
Partner
M NO.:-510574
Place:•Kolketa
Dated:- olnAfrirt, 7024
tiDth3:-.2.1.510S714PtAAAAms9s9
Pay/ 3dS
F-409
HINDUSTAN COPPER LIMITED
(A GOVT. OF INDIA ENTERPRISE) Regd. Office : Tamra Shaven 1, Ashutosh Chcnvdhury Avenue, Kolkata - 700 019.
CIN :L272131W191987G01028825 CONDENSED INTERIM UNAUDITED CONSOLIDATED BALANCE SHEET AS AT 31ST DECEMBER 2020
(T In lakh)
PARTICULARS Note No.
As at 31st December ,2020 (Unaudited) Reviewed
As at 31st March, 2020 (Audited)
ASSETS (1) NONCURRENT ASSETS (a) Property, Plant and Equipment 3A S 3B
(Limited Review)
38746.89
(Audited)
29427.52
(b) Capital Work In Progress
(c) Financial Assets (I) Investments
4
5
123814.15
47.36
123177.57
3.00
(it) Others 6 470.57 2836
(d) Deterred Tax Assets (Net) 7 9153.18 5290.81
(e) Non-Current Tax Assets (Net) 8 689.82 689.82
01 Other Non-Current Assets 9 45221.51 49269.28
(2) CURRENT ASSETS
(a) Inventories
(b) Financial Assets 10
11
19671.97
9.87
51982.72
9.48 (i) Investments (ii) Trade receivables 12 13118.69 6289.35
(ii) Cash and cash equivalents 13 2641.38 1134.86
(Iv) Bank Balances other than above 14 15.56 452.52
(v) Others 15 5215.12 2686.41
(c) Current Tax Assets (Net) 16 1866.62 1845_39
(6) Other current assets 17, 40301.14 37491.49
Total Assets 309983.82 311776.58
EQUITY AND LIABILITIES (1) Equity (a) Equity Share Capital 18 46260.90 46260.90
(b) Other Equity 19 64952.03 49734.19
Attributable to Non Controlling Interest (a) Equity Share Capital 11.70 6.50
(b) Other Equity (10.11) (6.45)
Liabilities 1 NONCURRENT LIABILITIES (a) Financial Liabillies
(I) Borrowings 20 8.4731.11 63617.53
(ii) Other financial liabilities 21 64153 843.53
(b) Provisions 22 8215.93 6666.93
(2) CURRENT LIABILITIES
(a) Financial LiatAkties (i) Sorra...Inge 23 42310.73 92749.96
(5) Trade Payables 24 16281.20 23374.42
Qh Other financial Gabilities 25 9868.11 8582.21
(b) Other current (Wallies 26 21090.57 16984.81
(c) Provisions 27 3398.12 3063.04
(d) Current Tax Liabilities (Net) 28 3832.00
Total Equity & Liabilities 300983.82 31 776. 8
Corporate Information 1
Significant Accounting Policies 2
General Notes on Accounts 39
The notes referred to above form an Integral part of the Financial Statements.
As per our limited review report of even date attached. For and on behalf of the Board of Directors
teLtitepic ri/.1.11A 0,_ .LC"-'ki C-CP
For Chaturvedi & Co. C.S.Sffight Sulthen Kumar Bandyopadhyay Awn Kumar Shukla
Chartered Accountants Company Secretary Director (Finance) 8 CFO Chairman and Managing Director 8 CEO
FRN 302137E (M No. FCS 2570) ( DIN : 08173882) ( DIN :03324672)
(CA R K NANDA ) Partner (M No. 510574 )
Place : Kolkata
Dated CI; • Ott 2.0
F-410
INDUSTAN COPPER LOOTED
(A GOVT. OF INDIA ENTERPRISE) Regd.Office : Tema BRavan I. Ashutosh Chowdbury Avenue Kolkata -706 OIL
CIN1_27201W01967001026825 CONDENSED INTERIM UNAUDITED CONSOUDATEJ3 STATEMENT OF PROFIT AND LOSS FOR THE NINE MONTHS ENDED 31,1 DECEMBER 2020
CT in lakh except EN) Forth. NIp. Motions ended 31.1
December .2020 (Unavdited) Reviewed
For Ote year ended 3151 March, 2020 (Audited) Particulars
Note
(Limited Review) INCOME
I Revenue From Operations
II Other Income
III Total Income 110111
IV EXPENSES
Cost ir{ Materials consigned 31 161.07 628 24
Changes in Inventories al Finished Goo*
Semi-Finished and Wort-in-Process 32 32517.81 (5113.58)
Employees Beteg Esperrse 33 19621.98 25962.31
Finance Cat 34 5103.52 6041 89
Depreciation and Amortisafion Expense 35 20179.63 28862 06
Generallerreestrahon 6 Other Expenses 36 36355.39 66257.39
29
126452 05
30
255363
129005.68
6318525
8695.22
118881.47
Total Expenses 11V) 113939.39 142629.
PROFIT /(LOSS) BEFORE EXCEPTIONAL ITEMS AND
15060.29 (53758.84) TAX 1111419 VI Exceptional iterns
VII PROFIT WOW) BEFORE TAX (V.V11 150615.29 93756.84)
VIII TAX EXPENSE 37
I) Current Tax 383200 642.18 2) Deterred Tax (3484.85) 2295.83 IX PROFIT ((LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS AFTER TAX (V114111) 14719.14 (50894.851
0(1A) PROFIT 4LOSS) FOR THE PERIOD AFTER TAX -Attributable to Owners 11X-IX(13)) 1472260 (56894.85) D(B) PROFIT 1(10055 FOR THE PERIOD AFTER TAX- Attributable to Non Ccetrolling Interest 13.66)
X Profit/(Loss) from discontinued operations (26.14) (31.70)
XI Tax expense of disakitelled operations (6-58) (8.73) )01 PROFIT/(LOSS' FROM DISCONTINUED OPERATIONS AFTER TAX (X -XI) (19.56) (25.97) Mil PROFIT KLOSS) FOR THE PERIOD AFTER TAX 11X.X11( 14699.53 (5592012) XIV Shen of Profit/1ton) of Joint venture! Associate (27.64)
NET PROFIT /KASS) FOR THE PERIOD AFTER TAX It XV SHARE OF PROFIT/GOSS) OF JP:ASSOCIATE 14699.58 (5eoutais)
ocin.x nn /MA) PROFIT 4105$) FOR THE PERIOD AFTER TAX- Attributable Oa °gnats 1)(111401(13)) 14703.24 (56948.46) 20.00) PROFIT 4105$) FOR THE PERIOD AFTER TAX -Attributable to Non Controlling Interest (3.86)
XIV OTHER COMPREHENSIVE INCOME I(LOSS) 36 gi) gems that wIll not be reclassified to Profit ((loss) (150000) 13000.951
Income Tax renting to items that will not be An)
337.52 75528 feclassirtad to Profit / Loss
Bli) Items that will ba reclassinee to Profit/ (Loss)
O ( a) Income Tax telating to items that will be reclassified to Prof IV Goss) TOTAL CO1APREHENS(VE INCOME )(LOSS) FOR THE XV PERIOD 1X111.X1V1 (Compds)ng ProfltfiLoss) and other Comprehensive
13577.10 (59194.13) Income for the period AttrIbUtable to Owners of the Company 1305035 (59194.1) Non COntroffing Interest (3.65)
XVI Earning per epuky snare (for continue° operations) 1 BASIC (El 2 DILUTED IT)
VII Earning per eluty share (Ior dkcmrlinued operations)
I BASIC It) 2 DILUTED (7)
Eamirg per entity 'hare (for d'
8 continuing epergnes)
1 BASIC (0) 2 DILUTED M
Conotate Inks Matron 1
Significant Accounting Ponies 2
General Notes on Accounts 39
The notes referred to stove form an Integral part of the Financial Statements.
XVIII
1.591
(0.032) (0.002)
1.519 1.589
(6.152)
(5.1521
(0.003) (0.003)
(6.155) (6.155)
per OW Meted review report of even data attached. For and on lot gie Board of Cannon
For Chaining & Ca Chalon AinnuMants FRN 302137E
C.S.SI Company Secretary (d he. P002570)
suldten K mat Bandy padhysy Director (Finance) 8. CFO
I DIN: 0517388 I
ArtIll Kumar Shinn Chairman and Managing Director ft CEO
I DIN ' 033246721
CAR K DA) Pall ne 11A No 510574 )
Dad oT.
F-411
Hindustan Copper Limited c_3 Condensed Interim Unaudited Consolidated Statement of Changes in Equity for the period ended 31st December 2020
A . Equity Share Capital (tin lakh)
Balance at the beginning of the reporting period 01.04.2019
Changes in equity share capital during the period Balance at the end of the reporting period 3103.2020
46260.90 96260.90
B. Other Equity Particulars General Reserve Capital
Reserve Corporate Social Responsibilit v ReServe
Mine Closure Reserves
Currency Fluctuation
Reserve
Retained Earnings Total
Balance at the beginning of the reporting period 01.04.2019 8965.97 21166.24 163.00 155.94 86960.39 117411.54
Dividends & Dividend Tax (5800.08) (5800.08) Profit for the Year After Tax - Atributable to Owner (56948.46) (56948.46) Profit for the Year After Tax - Atributable to Non Controlling Interest Other Comprehensive Income (net of tax) (2245.67) (2245.67) Amout addition during the year 75.00 (2764.59) (2689.59) Amout used during the year Balance at the end of the reporting period 31.03.2020 8965.97 21166.24 238.00 (2608.65) 21966.18 49727.74
Statement of Changes In Equity A. Equity Share Capital (tin lakh)
Balance at the beginning of the reporting period 01.04.2020
Changes in equity share capital during the year Balance at the end of the reporting period 31.12.2020
46260.90 46260.90
B. Other Equity Particulars General Reserve Capital
Reserve Corporate Social Responsibilit y Reserve
Mine Closure Reserves
Currency Fluctuation
Reserve
Retained Earnings
Total
Balance at the beginning of the reporting period 01.04.2020 8965.97 21166.24 238.00 (2608.65) 21966.18 49727.74
Dividends & Dividend Tax Profit for the Year After Tax• Atributable to Owner 14703.24 14703.24 Profit for the Year After Tax' Atributable to Non Controlling Interest (3.66) (3.66)
Other Comprehensive Income (net of tax) (1122.48) (1122.48) Amaut addition during the year 1637.08 1637.08 Amout used during the year Balance at the end of the reporting period 31.12.2020
8965.97 21166.24 238.00 (971.57) 35543.28 64941.92
As per our limited review report of even date attached. For and on behalf of the Board of Directors
For Chaturvedi & Co. Chartered Accountants FRN 302137E
Oc:141; C.S.Sing
Company Secretary (11 No. PCS 2570)
31-51J Sukhen Kumar Bandyopadhyay
Director (Finance) & CFO ( DIN : 08173882)
Arun Kumar Shukla Chairman and Managing Director & CEO
( DIN: 03324672)
(CA R K NANDA ) Partner M No. 510574
Place : Kolkata Dated: 04. f20
F-412
HINDUSTAN COPPER LIMITED ( (A GOVT. OF INDIA ENTERPRISE) _
Regd. Office: Tamra Bhavan 1, Ashutosh Chowdhuly Avenue, Kolkata - 700 019. CIN: L27201WB1967G01028825
Condensed Interim Unaudited Consolidated Statement of Cash Flow for the Nine Months Period ended 31st December 2020 g in lakh) Nine MOntris period Year ended 31st ended 31st Dec 2020 March, 2020
(Unaudited) (Audited) Reviewed
A. CASH FLOW FROM OPERATING ACTIVITIES : NET PROFIT/ (LOSS) BEFORE TAX AS PER PROFIT AND LOSS ACCOUNT 15066.29 -53756.84
Adjusted for: Depreciation 3105.96 3590.33
Provisions charged 559.97 18866.24
Provisions written back (981.69) (2280.83)
Interest expense 5103.52 6041.89
Amortisation 17073.67 25271.73
Interest income (25.95) (1021.90)
Loss! (Profit) on disposal of fixed assets 2.04
Share of Profit / (Loss) in Joint Venture - (27.64)
OPERATING PROFIT/ (LOSS) BEFORE WORKING CAPITAL CHANGES 39901.77 (3314.98)
Adjusted for: Decrease/ (Increase) in Trade & other Receivables -5893.42 27921.74
Decrease/ (Increase) in Inventories 32310.75 (5682.60)
Decrease/ (Increase) in Current & Non-Current assets (5208.01) (3781.12)
Increase/ (Decrease) in Current & Non-Current Liabilities (551.68) (2121.72)
CASH GENERATED FROM OPERATIONS 60559.41 13021.32
Tax Refund received - 0.00
Taxes paid - (4423.72)
NET CASH FROM OPERATING ACTIVITIES (A) 60559.41 8597.60
B. CASH FLOW FROM INVESTING ACTIVITIES: Purchase of Fixed Assets (13271.37) (22094.87)
Sale of Fixed Assets 0.11 12.03
Interest received 27.38 1015.68
Advance for / (Recovery of advance) for Capital expenditure - 0.00
Investment in Joint Venture (44.36) (3.00)
Mine Development Expenditure (12926.38) (21913.69)
NET CASH USED IN INVESTING ACTIVITIES ( B ) (26214.62) (42983.86)
C. CASH FLOW FROM FINANCING ACTIVITIES
Non-Current borrowings! (Loan repaid) 23664.35 15895.20
Dividends paid 0.00 (4811.14)
Tax on Dividend 0.00 (988.94)
Interest paid (5142.50) (5895.91)
Increase in Other Equity 5.20 0.00
NET CASH USED IN FINANCING ACTIVITIES ( C ) 18527.05 4199.21
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+13+C) 52871.84 (30187.04)
CASH AND CASH EQUIVALENTS - opening balance (68300.50) (38113.46)
CASH AND CASH EQUIVALENTS - closing balance (15428.66) (68300.60)
( details in Annexure - A)
Notes This is the Cash Flow Statement referred to in our limited review report of even date. The above Condensed Interim Unaudited Standalone Cash Flow Statement should be read in conjunction with the accompanying notes.
For and on behalf of the Board of Directors
a p . ---- For Chaturvedl 8 Co. C.S.S1 hi Sukhen Kumar Bandyopadhyay Arun K Shukla
Chartered Accountants Company Secretary Director (Finance) & CFO Chairman and Managing Director & CEO
FRN 302137E (M No. FCS 2570) ( DIN :08173682) ( DIN :03324672) ...
:.:.. ..
CA R K NANDA Partner (M No. 510574 )
Place: Kolkata Dated: 0 T i 0 Li . Ea 2_1
F-413
CASH AND CASH EQUIVALENTS - closing balance
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) ii) Current Financial Assets - Bank Balance other that above (Note 14)
(Excluding Unpaid Dividend of Z 20.31 Lakh) iii) Current Financial Assets - Investments (Note 11) iv) Non-current Financial Assets - Others (Note 6) v) Current Financial Liabilities - Borrowings (Note 23)
(Excluding Long Term Loans of Z 23760.25 lakh)
ANNEXURE - A zIn lam
01/04/2020 01104/2019
1134.86 663.53 432.21 408.33
9.48 8.85 26.36 12.47
(69903.41) (39206.64)
68300.50 (38113.46)
31/12/2020 31/03/2020
2641.38 1134.86 432.21
9.87 9.48 470.57 26.36
(18550.48) (69903.41)
15428.66 (68300.50)
1. CASH AND CASH EQUIVALENTS - opening balance
i) Current Financial Assets - Cash & Cash Equivalents (Note 13) ii) Current Financial Assets - Bank Balance other that above (Note 14)
(Excluding Unpaid Dividend of 15.56 Lakh) iii) Current Financial Assets - Investments (Note 11) iv) Non-current Financial Assets - Others (Note 6) v) Current Financial Liabilities - Borrowings (Note 23)
(Excluding Long Term Loans of 22846.55 lakh)
2. The Cash Flow Statement has been prepared as set out in Indian Accounting Standard (IND AS) 7 : STATEMENT OF CASH FLOWS, as amended by Companies (Indian Accounting Standards) (Amendment) Rules 2016.
This is the Cash Flow Statement referred to in our report of even date attached
F-414
HINDUSTAN COPPER LIMITED
NOTES TO CONDENSED INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1.Corporate Information
Hindustan Copper Limited, established in 1967 and domiciled in India is a Central public sector undertaking under the administrative control of Ministry of Mines, Government of India. The registered office of the Company is situated at Kolkata. The principal activities of the Company are exploration, exploitation, mining of copper and copper ore including beneficiation of minerals, smelting and refining. The Company has copper mines & concentrator plants in Malanjkhand Copper Project at Madhya Pradesh (MCP), Khetri Copper Complex at Rajasthan (KCC) and Indian Copper Complex, Ghatsila at Jharkhand (ICC). The Company is operating Smelter & Refinery in ICC and Gujarat Copper Project, Gujarat (GCP) for production of copper cathode. Further, cathode is converted into copper wire rod at Copper wire rod plant at Taloja Copper Project, Taloja, Maharashtra (TCP). The Company is listed with BSE Ltd. and National Stock Exchange of India Ltd.
Chhattisgarh Copper Limited (CCL) ,established on 21.05.2018 and domiciled in India, is a Joint Venture Company (JVC) formed between Hindustan Copper Limited (HCL) and Chhattisgarh Mineral Development (CMDC) for exploration, mining and beneficiation of copper and its associated minerals in the State of Chhattisgarh. Since HCL holds 74% equity in ]VC, it is also a Subsidiary of HCL as per Section 2(87) of the Companies Act, 2013.
2.Sionificant Accounting Policies
2.1 Basis of Accounting
The financial statements are prepared under historical cost convention from the books of accounts maintained under accrual basis except for certain financial instruments which are measured at fair value and in accordance with the Indian Accounting Standards prescribed under Companies Act, 2013.
2.2 Basis of consolidation
2.2.1 Subsidiaries
Subsidiaries are all entities over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date when control ceases.
The acquisition method of accounting is used to account for business combinations by the Company.
The Company combines the financial statements of the parent and its subsidiaries line by line adding together like items of assets, liabilities, equity, cash flows, income and expenses, Intercompany transactions, balances and unrealized gains on transactions between Company companies are eliminated.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of profit and loss, consolidated statement of changes in equity and balance sheet respectively.
F-415
2.2.2 Joint Ventures
Joint Ventures are those joint arrangements whereby the Company is having rights to the net assets of the arrangements. Interests in joint ventures are accounted for using the equity method, after initially being recognised at cost.
2.2.3 Equity method
Under the equity method of accounting, the investments are initially recognized at cost and adjusted thereafter to recognize the Company's share of post-acquisition profit or losses of the investee in profit and loss, and the Company's share of Other Comprehensive Income of the investee in the Other Comprehensive Income.
2.3 Application of Indian Accounting Standards (Ind-AS)
The Group adopted Indian Accounting Standards (Ind AS) from April 1,2016 and accordingly the financial statements have been prepared in accordance with the recognition and measurement principles as notified by MCA under the Companies (Indian Accounting Standards) Rules, 2015 ("Ind AS Rules"), as amended and other relevant provisions of the Companies Act, 2013.
The Group has adopted all the Ind AS as applicable and relevant to the Group.
2.4 Use of Estimates
The preparation of the Group's financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Revision to accounting estimates are recognised in the period on which the estimates are revised and, if material their effects are disclosed on the notes to the financial statements.
2.5 Current and Non-current Classification
The Group presents assets and liabilities in the Balance sheet based on current/non-current classification. An asset are treated as current by the Group when:
a) its expects to realize the asset, or intends to sell or consume it in its normal operating cycle;
b) it holds the assets primarily for the purpose of trading;
c) it expects to realize the asset within twelve months after the reporting date; or
d) the asset is cash or cash equivalent (as defined under Ind AS 7) unless the asset is restricted from being exchanged or used to settle a liability for at least twelve months after the
reporting period.
Except the above, all other assets are classified as Non-current.
A liability is treated as current by the Group when:
a) its expects to settle the liability realize the asset, or intends to sell or consume it in its normal
operating cycle;
b) it expects to settle the liability in its normal operating cycle;
c) it holds the liability primarily for the purpose of trading; Sri--
F-416
d) the liability is due to be settled within twelve months after the reporting period; or
e) it does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting period. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.
Except the above, all other liabilities are classified as non-current.
2.6 Revenue Recognition
Revenue is measured at the fair value of the consideration received or receivable and fair value has been defined taking into account contractually defined terms of payment. Operating revenue recognized is net of all promotional expenses and discounts, rebates and/or any other incentive to customers.
Sale of Products
An entity shall account for a sale contract with a customer only when all of the following criteria are met:
(a) the parties to the contract have approved the contract (in writing, orally or in accordance with other customary business practices) and are committed to perform their respective obligations;
(b) the entity can identify each party's rights regarding the goods to be transferred;
(c) the entity can identify the payment terms for the goods to be transferred;
(d) the contract has commercial substance i.e the risk, ownership, timing or amount of the entity's future cash flows etc is expected to change as a result of the contract; and
(e) it is probable that the entity will collect the consideration to which it will be entitled in exchange for the goods that will be transferred to the customer.
In case of sale of Copper Concentrate, Copper Reverts, Anode Slime etc. and tolling of Copper Concentrate of Khetri and Malanjkhand origin, sales /tolling at the end of the accounting period are recorded on provisional basis as per standard parameters for want of actual specifications and differential sales value are recorded only on receipt of actual. This is as per consistent practice followed by the Group.
Sale of Services
Income from conversion of job work is accounted for on the basis of actual quantity dispatched. When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shall be recognized by reference to the stage of completion (Percentage of Completion Method) of the transaction at the end of the reporting period.
Advances received from the customers are reported as customer's deposits unless the above conditions for revenue recognition are met.
Other Operating Revenues
a. Sale of Scrap
Sale of Scrap is accounted for on delivery of material. Si--
F-417
b. Interest from Customers
In case of credit sales ,interest up to the date of Balance Sheet on all outstanding bills is accounted for on accrual basis.
c. Interest from Contractors against mobilisation advance for mining operations
Interest up to the date of Balance Sheet on all mobilisation advances for mining operations is accounted for on accrual basis.
d. Penalty and Liquidated Damages
Penalty and liquidated damages are accounted for as and when these are realised by the company as per contract terms.
Other Income
a. Claims
Claims are recognized in the Statement of Profit & Loss (Net of any payable) including receivables from Government towards subsidy, cash incentives, reimbursement of losses, etc, when there is certainty of realisation of such claim and that can be measured reliably.
b. Dividend and Interest from Investments
Dividend income from Investments is recognised in the Statement of Profit and Loss when the right to receive the dividend has been established and it is certain that the economic benefits will flow to the Group and the amount of income can be measured reliably.
Interest Income from a financial asset is recognised using Effective Interest Method. When it is probable that the economic benefits will flow to the Group and the amount of income can be measured reliably.
c. Profit on Sale of Investment
Profit on sale of investment is recognised upon transfer of title by the Group and is determined as the difference between the sales price and the then carrying value of the investment.
d.Provisions not required written back
Provisions/Liabilities created from business activities in earlier years no longer required are accounted for.
e. Others
Any other income is recognised on accrual basis.
2.7 Employees Benefit
Retirement benefit costs and termination benefits
Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service entitling them to the contributions.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Re-measurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest), is reflected
t4"--
F-418
immediately in the statement of financial position with a charge or credit recognized in other he comprehensive income in the period in which they occur. Re-measurement recognized in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to Statement of Profit or Loss. Past service cost is recognized in Statement of Profit or Loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorized as follows:
i. Service cost (including current service cost, past service cost, etc.);
ii.Net interest expense or income; and
iii. Re-measurement. The Group presents the first two components of defined benefit costs in profit or loss in the line item 'employee benefits expense'.
The retirement benefit obligation recognized in the statement of financial position represents the actual deficit or surplus in the Group defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.
A liability for a termination benefit is recognized at the earlier of when the Group can no longer withdraw the offer of the termination benefit and when the Group recognises any related restructuring costs.
Short-term and other long-term employee benefits
A liability is recognized for benefits accruing to employees in respect of wages and salaries, annual leave and sick leave in the period the related service is rendered at the undiscounted amount of the benefits expected to be paid in exchange for that service.
Liabilities recognized in respect of short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in exchange for the related service.
Liabilities recognized in respect of other long-term employee benefits are measured at the present value of the estimated future cash outflows expected to be made by the Group in respect of services provided by employees up to the reporting date.
Deficit in Provident Fund
Deficit, if any, in the accounts of Provident Fund Trust ascertained on the basis of last audited accounts of the Trust is accounted for as a charge to Revenue.
2.8 Borrowing Cost
Borrowing costs directly attributable to the acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the cost of the asset. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest expenses calculated using the effective interest method and other costs that an entity incurs in connection with the borrowing of funds. Borrowing cost also includes exchange differences to the extent regarded as an adjustment to the borrowing costs
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61 2.9Taxation
Income tax expense represents the sum of current tax and deferred tax.
Current tax
The current tax payable is based on taxable profit for the year as determined from net profit before tax as represented in Statement of Profit and Loss and Other Comprehensive Income, in line with different provisions under Income Tax Act 1961.Current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
Deferred tax
Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilized.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
Current and Deferred Tax for the year
Current and deferred tax are recognized in Statement of Profit or Loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity respectively.
2.10(a) Property Plant and Equipments (PPE)
The cost of an item of PPE is recognized as an asset if and only if, it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The cost of an item of PPE is the cash price equivalent at the recognition date. The cost of an item of PPE comprises:
Purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates.
U. Costs directly attributable to bringing the PPE to the location and condition necessary for it to be capable of operating in the manner intended by management.
iii. The initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which the Group incurs either when the PPE is acquired or as a consequence of having used the PPE during a particular period for purposes other than to produce inventories during that period.
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The Group has chosen the cost model of recognition and this model is applied to an entire class of PPE. After recognition as an asset, an item of PPE is carried at its cost less any accumulated depreciation and any accumulated impairment losses.
Pending reconciliation/receipt of the final bills against capital items, capitalization is done on the basis of cost booked and depreciation is charged accordingly. Price differences, if any, are adjusted in the year of finalization of bills.
In respect of expenditure during construction/development of a new unit/project in a new location, all direct capital expenditure as well as all indirect expenditure incidentals to construction are capitalized allocating to various items of PPE on an appropriate basis. Expansion programme involving construction concurrently run with normal production activities in an existing unit, all direct capital expenditure in relation to such expansion are capitalized but indirect expenditure are charged to revenue. Borrowing costs that are attributable to the acquisition or construction of qualifying asset are capitalized as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial period of time to get ready for its intended use.
Expenses incurred for implementation of new projects are carried forward against respective projects till execution. Expenses rendered in fructuous projects abandoned subsequently are provided for in the Statement of Profit & Loss.
Physical verification of PPE is conducted every year so that all the units/offices are covered once in a block of three years interval. Shortage/(Excesses), if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification.
Depreciation and Amortization
The Group has used the exemption available in Ind AS 101 with respect to recognition of Plant, Property and Equipment (PPE) and Intangible Assets at their carrying value being deemed cost.
The depreciable amount of an item of PPE is allocated on a straight line basis over its useful life prescribed in Part C of Schedule II of the Companies Act,2013 or actual useful life of assets assessed by the Technical Committee of the Group, whichever is lower. The residual value and the useful life of an asset are reviewed, at each financial year-end. Each part of an item of PPE with a cost that is significant in relation to the total cost of the item is depreciated separately. Depreciation on all such items have been provided from the date they are 'Put to Use' till the date of sale and includes amortization of intangible assets and lease hold assets. Freehold land is not depreciated. The residual value of all such items is taken at 5% of the original cost of individual asset.
An item of PPE is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Certain consumable items of small value whose useful life is very limited are directly charged to revenue in the year of purchase.
From the date Ind AS came into effect, the carrying amount of an asset is depreciated over the remaining useful life of the asset as per estimate of remaining useful life. Wherever, the remaining useful life of an asset is nil, the carrying amount is recognized in the opening balance of retained earnings after retaining the residual value.
2.10(b) Intangible Assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business combination is their fair value at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation (calculated on a straight-line basis over their useful lives) and accumulated impairment losses, if
any. joie_
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63 Internally generated intangibles, excluding capitalised development costs, are not capitalised. Instead, the related expenditure is recognised in the statement of profit and loss and other comprehensive income in the period in which the expenditure is incurred. An internally generated intangible asset arising from development is recognized if all the conditions stipulated in "Ind AS 38-Intangible Asset" are met. The useful lives of intangible assets are assessed as either finite or indefinite. Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each reporting period. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are considered to modify the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in the statement of profit and loss.
An intangible asset with an indefinite useful life is not amortised but is tested for impairment at each reporting date and its useful life is reviewed in each reporting period to determine whether events and circumstances continue to support an indefinite useful life estimate.
Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss.
Intangible Assets other than Software are amortized over estimated useful life which is equivalent to license period, generally not more than 5 years.
Cost of Software recognized as intangible asset, is amortised on straight line method over a period of legal right to use with a nil residual value. Otherwise the cost of software will be charged in the year of incurrence.
2.11 Capital Work in Progress
Assets in the course of construction are included under capital work -in-progress and are carried at cost, less any recognized impairment loss. Such capital work-in-progress, on completion, is transferred to the appropriate category of property, plant and equipment.
2.12 (a) Mine Development Expenditure
In case of underground mines : The expenditure on development of a new mine in all cases and on subsequent development of a working mine is capitalized and depleted on the basis of ore raised during the year and the mineable ore reserves estimated from time to time.
In case of working mines, where development activities are going on simultaneously: Expenses are apportioned between capital and revenue on the basis of in-house technical estimates.
In respect of open cast mines : The expenditure on removal of waste and overburden, is capitalized and the same is depleted in relation to actual ore production during the year on the stripping ratio which is re-assessed periodically based on the estimated ore reserve as well as the quantity of waste excavation in respect of open cast mines. Subsequently, If any ore is reclaimed from overburden, the same is included in inventory at a value based on opening rate of mine development expenditure with a corresponding credit in Mine development expenditure.
Expenditure incurred on development of new deposits are capital in nature and is included in mine development expenditure. If subsequently the development activities are found to be not viable, the expenditure on such development work included in mine development expenditure is written off in the year in which it is decided to abandon the project.
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If a working mine is closed due to economic reasons, the un-depleted value of Mine Development Expenditure related to that mine is provided in the books of accounts in the year in which it is decided to close or suspend operation of the mine. If later on, the closed / suspended mines are re-opened and the Group remains the owner of the mines, the unamortized Mine Development Expenditure which was fully provided in the year of closure will be written back in the books of accounts in the year of re-opening and the Group will be depleting it year wise based on the estimated remaining life of that mine.
2.12(b) Mineral Exploration and Evaluation Expenditures
2.12(b)(i) Pre-exploration costs
Pre-exploration costs are expensed in the period in which they are incurred.
2.12(b) (ii) Exploration and Evaluation Assets (E & E Assets)
Once the legal right to explore a property has been acquired, costs directly related to exploration and evaluation expenditures are recognized and capitalized, in addition to the acquisition costs. These direct expenditures include such costs as acquisition of rights to explore, materials used, topographical, geological, geochemical and geophysical evaluation, surveying costs, sampling, drilling costs, activities in relation to evaluation of technical feasibility and commercial viability of extracting a mineral resource, consultancy cost, payments made to contractors etc. during the exploration phase. Costs not directly attributable to exploration and evaluation activities are expensed in the period in which they occur.
Administrative and general overhead cost that are directly attributable to the assets are capitalized as E & E Assets.
E & E Assets may be tangible or intangible. To the extent that a tangible asset is consumed in developing an intangible asset, the amount reflecting that consumption may be part of the cost of the intangible asset created. However, the asset being used remains a tangible asset.
When a project is deemed to no longer have commercially viable prospects for the Group, exploration and evaluation expenditures in respect of that project are deemed to be impaired. As a result, those exploration and evaluation expenditure costs, in excess of estimated recoveries, are written off to Statement of Profit &Loss.
The Group assesses exploration and evaluation assets for impairment when facts and circumstances suggest that the carrying amount of an asset may exceed its recoverable amount.
Once the technical feasibility and commercial viability of extracting the mineral resource has been determined, the property is considered to be a mine under development and is classified as "mines under construction".
Exploration and evaluation Assets are also tested for impairment before the assets are transferred to development properties.
As the Group currently has not commenced commercial operations, any incidental revenues, including receipt of input tax credit receivables, earned in connection with exploration activities are applied as a reduction to capitalized exploration costs.
An impairment loss is reversed if there is an indication that there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation, if no impairment loss had been recognized.
2.130verhauling Expenses
Revenue expenditure attributable to overhaul of smelter and/ or refinery is charged off to the
•40.114 Statement of Profit & Loss in the year of incurrence.
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6C 2.14 Mine Closure Expenditure & Decommissioning/Site restoration liability
Financial implications towards final mine closure plans under relevant Acts and Rules are technically estimated and Mine Closure Reserve is created based on the estimated life of the mines over the period by charging the same to Statement of Profit and Loss.
2.15Non-Current Assets Held for Sale
The Group classifies a non-current asset (or disposal group of assets) as held for sale if its carrying amount will be recovered principally through a sale transaction rather than through continuing use. Immediately before the initial classification of the asset (or disposal group) as held for sale, the carrying amounts of the asset (or all the assets and liabilities in the group) are to be measured in accordance with applicable Indian Accounting Standards. The sale should be expected to qualify for recognition as a completed sale within one year from the date of classification except as permitted by Ind AS 105.
2.16Inventories
Stocks of stores and spare parts, loose tools and materials-in-transit are valued at the lower of the net realizable value and cost. The raw materials are also valued at the lower of the net realizable value and weighted average cost to the unit if the finished goods in which they will be incorporated are expected to be sold below cost. Loose tools when issued are charged off to revenue.
Finished goods and work-in-process are valued at the lower of the net realizable value and weighted average cost to the unit. The cost is exclusive of financing cost, such as, interest, bank charges, administration overhead, etc. Ore is valued at cost since its realisable value cannot be ascertained. The value of slag under work-in-process is taken at equivalent value to the extent credited to the process, where the said products have been generated. The reverts under work- in-process are valued at lower of cost (equivalent value of concentrate) and net realizable value.
The stock of anode slime arising from treatment and refining processes are stated at realizable value based on the yearend London Metal Exchange price for gold and silver after making due adjustments of their physical recovery and the treatment and refining charges.
The inventories out of inter-unit transfers (material in transit) at the close of the year are valued and accounted in the books of the transferor unit on the basis of cost plus transportation to the transferee unit or net realisable value whichever is lower.
Imported materials are valued at the lower of the net realizable value and weighted average cost. In the event where final price is not determined valuation is made on provisional cost. Variations are accounted for in the year of finalization.
Provision is made in the accounts every year, for non-moving stores and spares (other than insurance spares) which have not moved for more than five years. Insurance spares are fully provided for on the expiry of the life of the relevant Property Plant and Equipments.
Physical verification of Semi-Finished and In-Process (WIP) and Finished Goods is conducted departmentally in all the units at reasonable intervals during the year by a duly approved committee. Also, physical stock verification of WIP and Finished Goods is undertaken by a duly approved committee at the end of every financial year alongwith an independent agency once in a block of three years. In respect of Stores and Spares, physical verification is carried out by external agencies once in every year covering all the units. Shortage/(Excesses). if any, identified on such physical verification is duly adjusted in the books of accounts in the year of identification rsitio_
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2.17Government Grants
All government grants are recognized as deferred income and it will be taken to Statement of Profit and Loss over the period of time in accordance with the pattern in which the obligations are met.
2.18Impairment of Assets (Other than Financial Assets)
The Group assesses at the end of each reporting period whether there is any indication that an asset may be impaired. If any such indication exists, the Group estimates the recoverable amount of the asset. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognized immediately in Statement of Profit and Loss, unless the relevant asset is carried at a revalue amount, in which case the impairment loss is treated as a revaluation decrease.
Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
When an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
2.19Foreign Exchange Transactions
Transactions in currencies other than the Group's functional currency (foreign currencies) are recognized at the rates of exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are re-translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Foreign currency monetary items (except overdue recoverable where realizability is uncertain) are converted using the closing rate as defined in the Ind AS-21- The effects of changes in Foreign Exchange Rates. Non-monetary items are reported using the exchange rate at the date of the transaction. The exchange difference gain/loss is recognized in the Statement of Profit and Loss.
In case of long term foreign currency monetary items outstanding as of 31st March 2016,liability in foreign currency loans relating to acquisition of fixed assets is converted using the closing rate as defined in Ind AS 21-The effects of changes in Foreign Exchange Rates andthe difference in exchange is recognized in terms of exemptions given in paragraph D13AA of Appendix D to Ind AS-101, where the effect of exchange differences on foreign currency loans of the Group is accounted for by addition or deduction to the cost of the assets so far it relates to the depreciable capital assets and shall be depreciated over the balance life of the assets.
Other long term foreign currency monetary items are accumulated in 'Equity Component of Foreign Currency asset/liability Account' and amortized over the balance period of the asset/liability by recognition as income or expense in each of such periods as stated under Para 29A of Ind As 21.
NiOs—
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2.20Provisions, Contingent Liabilities & Contingent Assets
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event and it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
Wherever no reliable estimate could be made, a disclosure is made as contingent liability. A disclosure for a contingent liability is also made when there is a possible obligation or a present obligation that may but probably will not require an outflow of resources.
When there is a possible obligation or a present obligation in respect of which likelihood of outflow of resources is remote, no provision or disclosure is made.
Contingent Liabilities are disclosed in the General Notes forming part of the accounts.
Contingent Assets are not recognised in the financial statements but are disclosed in Notes to the Accounts. Such assets occur when the inflow of economic benefits is probable. Such contingent assets are assessed continuously, if it's virtually certain that inflow of economic benefits will arise then such assets and the relative income will be recognised in the financial statements.
2.21 Leasing
Assets held under lease, in which a significant portion of the risks and rewards of ownership are transferred to lessee are classified as finance leases. All other leases are classified as operating leases.
Depreciation expenses are recorded if asset held under finance lease is depreciable.
Finance expenses are recognized immediately in the statement of profit and loss if they are not directly attributable to qualifying assets, otherwise they are capitalised in accordance with the Group's general policy on borrowing costs.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term.
2.22 Financial Instruments
Non Derivative Financial Instruments
(i) Initial Recognition
Financial assets and financial liabilities are recognized when the Group becomes a party to the contractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. 30_
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(ii) Subsequent Recognition 6 ?5
a. Financial assets Financial assets are subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss.
b. Financial Liabilities Financial liabilities are subsequently measured at amortized cost using Effective Interest Rate (EIR) method except for derivatives, which are measured at fair value.
Derivative Financial Instruments
All derivatives are recognized and measured at fair value with changes in fair value being recognized in profit or loss for the period.
Impairment of financial assets
At each reporting date, assessment is made whether the credit risk on a financial instrument has increased significantly or not since initial recognition.
If the credit risk on a financial instrument has not increased significantly since initial recognition, the loss allowance is measured for that financial instrument at an amount equal to 12 month expected credit losses. If the credit risk on that financial instrument has increased significantly since initial recognition, the loss allowance is measured for a financial instrument at an amount equal to the lifetime expected credit losses.
The amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date is recognised as an impairment gain or loss in the statement of profit and loss.
2.23Events Occurring after the Reporting Period
The Group adjusts the amount recognized in its financial statements to reflect adjusting material events after the reporting period and does not adjust the amount to reflect non-adjusting events after the reporting period. However where retrospective restatement is not practicable for a particular prior period then the circumstances that lead to the existence of that condition and the description of how and from where the error is corrected are disclosed in Notes on Accounts.
2.24Dividends
Final dividend on shares are recorded as a liability on the date of approval by the shareholders in general meeting and interim dividends are recorded as a liability on the date of declaration by the directors in the meeting of the Board of Directors.
2.25 Cash and Cash Equivalents
Cash and cash equivalent in the Balance Sheet comprise cash at bank and on hand and short term deposit with an original maturity of three months or less which are subject to insignificant risk of changes in value.
2.26 Rounding of amounts
Amounts in these financial statements have, unless otherwise indicated, have been rounded off to 'Rupees in lakh' upto two decimal points.
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Note : 3 (A) Consolidated Prooestv.Plant and Eouinment (Active Assets) (T in lakh)
DESCRIPTION Free Hold Land
Buildings including Flant,Machlner
Sanitary and Water Supply
[yarn.,
y and Mining Equipment
Fixtures & Office Equipment
Vehicles Furniture 6 Electrical
Road anBridges ' an Culverts Railway Siding Equipment and
Installation
Shafts and inclines
Total
Gross CarryInd ArnOurB
2446.58
•
•
6728.85
14.47
• •
26588.06
1626.18
• -
(13.59)
0.58
323.97
84.29
(0.01)
(0.01)
Transfer From Discarded Assets-
•
168.24
57.73
• -
(0.45)
-
1026.39
•
0.01
293.86 2878.22
41.52
(0.02)
(0.01)
444.21
-
•
•
41697.88
1824.19
-
(14.07)
0.57
Gross Carrying Amount as at 01M41019 Exchange Differences Additions Inter-head Transfer in /(Out)
Transfer To Discarded Assets
Disposals Transfer Adjustments
Gross CarryIng Amount as at 31.03.2020 2446.58 6793.32 28201.23 007.74 225.52 1826.40 293.86 2919.71 494.21 43508.57
Accumulated DePreclation & Impairment
•
2042.70 522.27
-
•
5926.16 2846.05
•
105.46 44.36
•
Inter-head Transfer in Bout) -
63.90 29.94
- •
987.39 325.17
98.01 32.67
- -
•
778,57 222.95
•
41.97 13.99
•
10044.16 4036.90
-•
•
Accumulated Depreciation as at 01.04.2019 Depreciation charge during the year
Transfer From Discarded Assets Transfer To Discarded Assets Impairment Losses Exchange Differences Disposals Transfer
Accumulated Depreciaton 6 Impairment as 2564.97 8772.21 149.82 93.34 1312.56 130.68 1001.52 55.96 14081.06
at 31.03.2020 Net Carrying Amount as at 31.03.2020 2046.58 4178.35 19429.02 257.93 132.18 513.84 163.18 1918.19 388.25 29427.52
Gross Carrying Amount
2446.58
•
6743.32
226.45
28201.23
12,411.50
907.74
1.14
-
(0.19)
(0.02)
225.52
(0.32)
•
1826.40 293.86
•
2919.71
•
494.21
•
43508.57
12639.09
(0.32)
(0.19)
(0.02)
Gross Carrying Amount as at 01.04.2020 Exchange Differences Additions inter-head Transfer in /Put) Transfer From Discarded Assets Transfer To Discarded Assets Disposals
Transfer -
Adjustments
Carrying Amount as at 31.121020 Gross 2406.58 6969.77 40612.73 408.67 225.20 1826.40 293.86 2919.71 444.21 56147.13
Accumulated Depreciation A Impairment
2564.97 401.39
•
8772.21 2597.48
149.82 43.31
(0.09)
93.34 29.43
•
1312.56 100.17
-
-
130.68 24.62
-
1001.52 112.35
•
••
55.96 10.54
-
19081.06 3319,29
•
(0.09)
Accumulated Depreciation as at 01.04,2020 Depreciation charge during the year Inter-head Transfer In /(Out) Transfer From Discarded Assets Transfer To Discarded Assets impairment Losses Exchange Differences Disposals Transfer
Accumulated Depreciaton bi impairment as at 31.12.2020
2966.36 11369.69 193.03 122.77 1412.73 155.30 1113.87 66.50 17400.25
Amount as at 31.121020 2446.58 4003.41 29203.04 215.64 102.03 413.67 138.56 1805.84 377.71 38746,88 Net Carrying
Note : HCL has used the exemption available In Ind AS 101 with respect to recogni on of Property, Plant, Equipments 9
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Note : 3 ili) Consolidated PrOPerltffIant and EQUipmen/ (Discarded ASSe/s1 (tin Iakh)
DESCRIPTION Free Hold & Leasehold
Land
Buildings including Sanitary and Water Supply
System
PlantsMachiner y and Mining Equipment
Furniture & Fixtures & Office
Equipment Vehicles Roads Bridges Roads. Bridges and Culverts
Siding Electrical
Equipment and Installation
Shafts and Inclines
Total
Gross Carrying AMPUnt
Gross Carrying Amount as at 01.04.20/9 Exchange Differences Additions Inter-head Transfer In /10ut) Transfer From Active Assets Transfer To Active Assets Disposals Transfer Adjustments
364 181 91 946 84 39 56 23 09 24 93 62.28
0 00
92
0
30
00
1,374
1374.55
55
brass Carrying Amount at 31.03.2020 as 3.64 181.91 946.84 39.56 23.09 24.93 62.28 92.30
Accumulated Depreciation & Impairment
Accumulated Depreciation as at 01.04.2019 Depreciation charge during the year Inter-head Transfer In Rout) Transfer Ff0111 Discarded Assets Transfer To Discarded Assets Impairment Losses Exchange Differences Disposals Transfer
Accumulated Depreciaton & Impairment as . . .
1374.55 at 91,03.2020 Net Carrying Amount as at 31.03.2020 3.64 181.91 946.84 39.56 23.09 24.93 - 62.28 92.30
1374.55 'Less Provisions for Discarded Assets Net Carrying Amount (Net of Provisions) as at 31.03.2010
Gross Carrvina Amo_unt
Gross Carrying Amount as at 01.04.2020 Exchange Differences Additions Inter-head Transfer In /(Out) Transfer From Active Assets Transfer To Active Assets Disposals Transfer Adjustments
364 181.91 946.84 39 56 2309 24.93 62 20 92 3D 1374.55
1374.55 Carrying Amount at 31.12,2020 GfOSS as 3.64 181.91 946.84 39.56 23.09 24.93 62.28 92.30
Accumulated Depreciation Eat_pn ai r_r___..tent
Accumulated Depreciation as at 01.04.2020 Depreciation charge during the year Inter-head Transfer In gout) Transfer From Discarded Assets Transfer To Discarded Assets Impairment Losses Exchange Differences Disposals Transfer
Accumulated Depreciaton & Impairment as .
2020 pt 31.17
Carrying Amount as at 31.12.2020 I 3.64 181.91 946.84 39.56 23.09 I 24.93 I 62.28 92.30 1374.55 Net Less Provisions for Discarded Assets
1374.55
Net arrying Provisions) as at 31.12.2010
Note : HCL has used the exemption available in Ind AS 101 with respect to recognition of Property, Plant, Equipments (PPE) and Intangible Assets at their carrying value.
-43
F-429
PARTICULARS
As at 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
0 Investments In equity instruments - (classified as at cost) A Joint Venture Company (NC) named Khan( Bidesh India Lim6ed (KABIL) was formed on 01.08.2019 among National Mmunium Company (NALCO) ,Hindustan Copper Limited (MCI.) and Mineral Exploration Corporation Limited (MECL) Investment in JV Company - Khanij Bidesh India Limded 75.00 (HABIL) (Investment In KABIL.75,000 Nos. (Previous Year 30,000 Nos. ) of equity shares of flU (Previous Year 10) each fully paid up as at 31.12.2020) Addl(Less): Group Share of Profdsf(Lass) hi JvfAssociates upto 31.03.2020 TOTAL
27.64
3.00
47.36 3.00
Details of JVC Principal Activity and place of Incoporation Principal place of
business Proportion of ownership interest / voting rights held by the
Company as on 31.03.2020
To identify , explore, acquire, develop, process primarily strategic minerals overseas for supply to India for meeUng domestic requkements and for sale to any other counties for commercial use.
New Delhi 30%
I) Non Trade Investment in Debentures Less : Provision for diMillUti011 in value
0.17
0.17 0.17
0.17
TOTAL
AGGREGATE BOOK VALUE -UNOUOTED
AGGREGATE BOOK VALUE . QUOTED
MARKET PRICE OF QUOTED INVESTMENT
47.35 3.00
47.36 3.00
Nil Nil
PARTICULARS
As at 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
Bank deposits vdth more than 12 months maturity - With scheduled banks
TOTAL
470.57 26.36
470.57 26.36
Note No 4 CAPITAL WORK IN PROGRESS VI
(6 in lakh)
PARTICULARS
As at 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
i) Building 24.22 ii) Plant 8 Machinery 21630.87 ii) Others Magna Mine Expansion 106551.97
163.27 34389.11 92018.10
127207.136 126570.48
3392.91 3392.91
123814.15 123177.57
Less: Provision
TOTAL
Note No 5 NON - CURRENT FINANCIAL ASSETS - INVESTMENTS
(2 in lakh)
NOW No 6 NON CURRENT FINANCIAL ASSETS -OTHERS in Mich)
F-430
PARTICULARS
As at 3141 December .2020 Mat 31.5 Math. 2020
(Unaudited) Reviewed (Audited)
CLOSVIG BALANCE 9385.17 688422
II DEFERRED TM LIMILMY OPENING BALANCE (1014.43) 251629)( Ad}ustnenVeredil durin the year (18.10) 100385 CLOSING BALANCE (1930.53) (1014.43)
Dail DEFERRED TM ASSETS/ (LIABILRIES) (Nell 7434.84 3919.70
IS DEFINED BENEFIT PIANO OPENING BALANCE 1341.02 585.74 Min:Mennen* duping toe year 377.52 75520 CLOSING BALANCE 17lE51 1341.02
}NM) DEFERRED TM ASSETS I (UABIUTIES) 9153.10 Including OCI
(Rd nr Note No.30 General Notes on AccouMs Pcint No 10)
8 DEFERRED TAX ASSET OPEMND BALANCE 588422 9243.90 MashnenVCardt Wing the year 3500.95 (3379.061
As 8( 31st Macrh 2020 (Audited} PARTICULARS
As 31st December .2020 Ornaudamb
Income Tex (inducing advence income In. MS excluding current In Unseond • Osmadsred
689.82 689.02
68982 619 8 TOTAL
PARTICULARS Soot 31st her 9020 As at 31st March, 2020
(UnaUclasd1 Ft (Audis)
a) HOIMISATION ADVANCES 0 i)
Secured }considered good) Unsecured (considered gcal)
163706 1632 12
A0nrst Bank Guano*.
Cl Unmarred (coneldened dOIMM) 0.02 0.02
b)
tat Pranions too Captal Pstnnon •
Mine Development Expenditure
0.02 0.02
M per lest Silence Shea 48204.35 511(5.82
Add: ExpencRum during OH Year (as per Note Benxi 13300.78 22505.21 61S0513 73621 03
Lest Vine Sot. recanted Owing Mine Envelopment 161.07 144.95
Len Amorfnalon during De Year 17073.67 1723474 25271.73 25416.68
44270.30 40204 35
Len ProvIslon 4664.68 488468
TOTAL 39305.63 0539.10
Now PUNE DEVELOPMENT EXPENDITURE DURING THE YEAR
0 i)
SanrIes, Warms, Manna, Conn:Mon to ProMeM & Other Funds
1726.15 134.58
2655.31 211.43
I) Workmen & Steel Welfare Expenes 2.35 998
in) Dorn Spars II Tools Commed 1221.04 196370
Power. Fuel& Water 420.20 655.21
Royally 11.71 1)03
90 ROM Mannam}e 2300.09 4352_83
nod) insurance 1.33 1.17
Onthorden Reenovel Emmen!. 6790.10 11275.24
Otprecinon 213.33 440.57
sr) Other Expenses 372.90 92219
TOTAL 11300.78 23000.2
Th• above expenditure Is n sdditron to the nprines shown under the respective natural had of amounts [Skated and charged In the Statement of Pete and Loss Monied 101 the ow and In the Meant schedule thereof.
AM016.111011dUSIO the year 15 In reation It the expanses ircuirv4 on mines Mkh no under operatIon/proluctIon and doss nol Include expenditure on prospering of minerals In one mines area
cl Right to tne Rent for Leaserhold land 3984.02 4097.67
TOTAL 3984.02 4007.67
TOTAL Mahn) 45221.51 49280.20
PROVISIONS FOR CAPITAL ADVANCES • OPENING BALANCE 002
Addibans during Me yen Amount seed dung Me year CLOSING BALANCE 0.02 082
ole No 7 DEFERRED TAX ASSETS (NET)
Not NONCURRENT MX ASSETS (NM gin lath)
0 OTHER NON -CURRENT ASSETS R in la
F-431
PARTICULARS
As at 3141 December .2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
Number of NAV Ce t) units Investments in Mutual Fund (MaturityWhin 3 months from date of original Investments)
I INOUJC in lakh) Note No 12 l'Uniwn niu4inaHI- m0001°
UT1 MONEY MARKET -GROWTH 51.736 2267.76 1.21 1.17
(51.736) (2112.55) $IBI ULTRA SHORT TERM DEBT FUND - GROWTH 132.117 4479.65 6.22 5.92
(132117) (4169.40) CANARA REBECO LIQUID FUND - GROWTH 38.993 238998 0.95 0.93
(38.993) (22513.68)
68.469 2130.97 1.49 1.48
9.41
Nil
AGGREGATE BOOK VALUE • QUOTED
MARKET PRICE OF QUOTED INVESTMENT
FUND IDBILIOUID -GROWTH
TOTAL
AGGREGATE BOOK VALUE' UNQUOTED
(38.459) (2002.99) 9.87
NV
7.84
9.87
7.84
9.48
As at 31st December 2020 As .031st March, 2020 PARTICULARS (Unaudited) Reviewed (Audited)
DEBTS OUTSTANDING 0 • Secured • considered good II) • Unsecured - Considered good Ili) - Considered doubtful
13118.69
1064.00
8289.35
e68.51 14182.77 9175.86
Less: Mlowances for bad 8 doubtful debts ' 1064.08 13118.69 886.51 8289.35
TOTAL 13118.69 8289.35
ALLOWANCES FOR BAD & DOUBTFUL DEBTS • OPENING BALANCE 886.51 942.77
Additions during the year 177.61 0.31
Amount used during the year 0.04 56.57
CLOSWG BALANCE 1064.08 1385.51
Explanatory Note:.
Debt doe by ()nectars or other officers of the company or any of them ether severally or Johilly with any other person or debts due by firms or private companies respectively In 'Mich any Director of the Company Is 5 partner ore Director or a member amounts to N4 (Previous year
ole No 10 INVENTORIES It in lakh)
As at 31st December ,2020 PARTICULARS (Unaudited) Reviewed
0 Raw Materials
Send-Finished and In-Process (al lower of cost or net JO realisable value) 31938.22 64456.03
Less: ProNsion tor Sem191thsbed and In-Process ' 18454 83 13483.39 18454.83
iii) Finished Goods (al lower of cost or nal realisable value) 83.00
iv) Stores and spares 7432.91 7646.10 Stores in transit/ pending Inspection 1023.55 603.30
6456.46 8249.40 Less: Provision for Obsolete Stores & Spares 2350.88 6105.58 2350.88
TOTAL 19671.97
PROVISION FOR SEMI-FINISHED AND IN.PROCESS OPENING BALANCE 18454.03 Additions during the year Amount used during the year CLOSING BALANCE 18454.63
PROVISION FOR OBSOLETE STORES & SPARES** OPENING BALANCE 2350.88 Additions during the year 0.00 Amount used during the year 0.09
CLOSING BALANCE 2350.88
As at 31st march, 2020 (Audited]
4600120
83.00
5898.52
61902.71
123.03 18331.80
18454.03
2616.03 1.40
268.55 2350.68
Note Nail CURRENT FINANCIAL ASSETS - INVESTMENTS (tin lakh)
F-432
PARTICULARS
As at 31st December 2020 As at 31.1 March, 2020
(Unaudited) Reviewed (Audited)
Other Balances with Bank
• in Dividend Balance ACCOurit
Bank deposes with more than 3 months and unto 12 months maturity - With scheduled banks
15.56 20.31
43221
15.56 452.52
Note No 13 CURRENT FINANCIAL ASSETS CASH 8. CASH EQUIVALENTS
(T in lakh)
PARTCULARS
As 51 31.6 December ,2020 As .131st Mirth, 2020
(Unaudited) Reviewed (Audited)
CASH AND CASH EQUIVALENTS
Cash on hand including Imprint
0.25 0.25 I. Balance wIlh Banks
-Current Account
2641.13 1134.61 It. OTHER BALANCES WITH BANK
Bank deposits upta 3 months maturity from dale of origins! investmen1 • With scheduled banks
TOTAL 2641.38 1134.86
Note No 14 CURRENT FINANCIAL ASSETS BANK BALANCE OTHER THAN CASH &CASH EQUIVAI-E In lath)
Note No 15 CURRENT FINANCIAL ASSETS - OTHERS 18 in lakh)
PARTICULARS
As at 31st December ,2020 As at 31s1 March, 2020
(Unaudited) Reviewed (Audited)
a) ADVANCES. Employees - secured (considered good) - Unsecured (considered doubtful) Less : Provisions for doubtful Advances'
0) INTEREST ACCRUED ON LC front Customers • •
it) investments 1514 10.66
Deposits 20.31 29.64
Fr) Others 0.18 3923 0.36 40.66
C) CLAIMS RECOVERABLE Maims recoverable from different agencies 5222.66 2712.61
Less: Prorislon for Doubtful Claims ‘" 179.41 504325 179.41 2533.20
TOTAL (art•c) 5215.12 2586.41
RETAILS OF PROVISIONS
PROVISION FOR DOUBTFUL ADVANCES •
OPENING BALANCE 2.03 2.03
AcKtIons during the year Amount used during the year CLOSING BALANCE 2.03 2,03
PROVISION FOR DOUBTFUL CLAIMS w
OPENING BALANCE 179.41 133.10
Additions dudng the year 0.00 46.31
&Miura used during the year CLOSING BALANCE 179.41 179.41
Explanatory Note: -
PARTICULARS OF LOANS AND ADVANCES DUE FROM DIRECTORS I) Amount due at the end of the year T NO
11) Advance due by frms or private companies In which any Director close Company lie Penner ore director or a member amounts to MI (Previous year NII)
132,64 2.03 2.03
112.55 2.03 2.03
132.64
112.55
40-
F-433
7 C (3 in latch) Note No 16 CURRENT TAX ASSETS (Net)
PARTICULARS As at 31st March, 2020 (Audited)
As at 31st December 2020 (Unaudited) Reviewed
1866.62 1845.39 Income Tax (incithrs advance income tax, TDS & excluding current Lax liablity) Unsecured - Considered good
TOTAL 1866.62 1,845.39
PARTICULARS
As at 31st December ,2020 As at 31st March, 21:020
(Unaudited) Reviews (Audited)
Note No 17 OTHER CURRENT ASSETS (ff in latch)
a) Advances to contractors I suppliers - Secured (considered good) 388.30 239.21 - Unsecured (considered good)
- Agahst Bank Guarantee -Others 1023.52 1127.08
- Unsecured (considered doubtful) 678.68 679.54
b) Other Advances
2088.50 2045.63
- secured (considered good) 50.90 50.90 - Unsecured (considered doubtful) 13.93 13.93
64.83 64.83 2153.33 2110.66
Less: Provision for Doubtful Loans and Advances • 692.61 693.47 1480.72 1417.19
c) Advance to JV44ABIL 72.00 Addl(Less): Group Share of Profits/(Loss) in 27.64 JWAssociates upto 31.03.2020
d) DEPOSITS
44.36
Other Deposits 10760.85 10136.08 Less: Provision for Doubtful Deposits'* 75.56 75.56
e) OTHER CURRENT ASSETS 10685.09 10050.52
Other Current Assets 213.41 211.52
Less: Provision for Other Current Assets ••• 3.52 3.52 209.89 208.00
5 OTHER RECOVERABLES
g)
IGSTfCGST 8 SGST
RIGHT TO USE
27784.90 25554.81
Rent for Leasehold Land 160.54 206.81
TOTAL 40301.14 37491.49
DETAILS OF PROVISIONS
PROVISION FOR DOUBTFUL LOANS AND ADVANCES OPENING BALANCE 693.47 737.26
Additions during the year 0.26 2.52
Amount used during the year 1.12 46.31
CLOSING BALANCE 692.61 693.47
PROVISIONS FOR DEPOSITS •• OPENING BALANCE 75.56 75.56
Additions during the year Amount used during the year CLOSING BALANCE 75.56 76.56
PROVISION FOR OTHER CURRENT ASSETS •••
OPENING BALANCE 3.52 3.52
Additions during the year Amount used during the year CLOSING BALANCE 152 3.62
F-434
PARTICULARS
As at 31st December 2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
18110000000 90000.00 1800000000 90000.00
2000000 20000.00 2000000 20000.00
In No. in lakh) In No. CT In lakh)
d) NO. OF SHARES ISSUED, SUBSCFUBED AND FULLY PAID UP - Equity Share Capita! 925218000 46260.90 925218000 46260.90 - 7.50% Non-Cum. Redeemable Preference Shams
TOTAL 46260.90 46260.90
RECONCILIATION OF NO. OF SHARES & SHARE e) CAPITAL
OUTSTANDING: No. of Shares IT in lakh) No. of Shares (T In lakh)
OUTSTANDING AS ON 01.04.2019 925218000 46260 90 925218000 46260.90
Add: Share Capital issued/ subscribed during the year
Less: Reduction in Share Capital
OUTSTANDING AS ON 31.03.2020 925218000 46260.90 925218000 46260 90
TERMS/RIGHTS ATTACHED TO EQUITY SHARES
a) AUTHORISED SHARE CAPITAL
- Equity Share Capital
- 7.50% Non-Cum, Redeemable Preference Shares
b) PAR VALUE PER EQUITY SHARE (In T)
c) PAR VALUE PER PREFERENCE SHARE (In 2)
5.00 5.00
1000.00 1000.00
Note No 18 EQUITY SHARE CAPITAL
(Tin lakh)
SHARES IN THE COMPANY HELD BY EACH SHAREHOLDER
The Company has or one class of Equity Shares having par value of T 51- each and is entitled to one vote per share.
HOLDING MORE THAN 5 PERCENT OF THE NUMBER In No. In (%) In No. In (%) OF SHARES
- President of India 703587852 76.05% 703587852 76.05%
-Life Insurance Corporation of India 105685655 11.42% 105585666 11.42%
For Subsidiary
- HCL 185000 74.00% 185000 74.00%
- CMDC LTD 65000 26.00 65000 26.00
F-435
Note No 19 OTHER EQUITY (Tin lakh)
PARTICULARS
As at 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
a) CAPITAL RESERVE ' AS PER LAST BALANCE SHEET
b) GENERAL RESERVE
AS PER LAST BALANCE SHEET
21166.24 21188.24
8985,97 8965.97
C) CORPORATE SOCIAL RESPONSIBIUTY FUND
AS PER LAST BALANCE SHEET
Add: During the year
Less: Amount reversed during the year
Less: Amount used during the year
AS AT BALANCE SHEET DATE
40
0
St
MINE CLOSURE RESERVE
AS PER LAST BALANCE SHEET
Add: During the year
Less: Amount reversed during the year
Less: Amount used during the year
AS AT BALANCE SHEET DATE
CURRENCY FLUCTUATION RESERVE
AS AT BALANCE SHEET DATE
Add: Equity Component of Foreign Currency Loan
Less: Amount reversed during the year
Less: Amount used during the year
AS AT BALANCE SHEET DATE
RETAINED EARNING •••
TOTAL
238.00 163,00
75.00
23E100
(2608.65)
1637.08
238,00
155,94
(2764.59)
(971.57)
35553.39
(2608,85)
21972.63
64952.03 49714.19
Details of Retained Earning ••• Profit ((Loss) for the period after tax as per statement of 14699.58 (56920.82) Profit and Loss Add/(Less): Group Share of Profits/(Loss) in (27.64) At/Associates Less : Profit /(Loss) for the period after tax - Attnbutable to (3.66) Non Controlling Interest Profit /(Loss) for the period after tax - Attributable to 14703.24 (56948.46) Owners Other Comprehensive Income f(Loss) as per Statement of (1122.48) (2245.67) Profit and Loss (net of tax) Total Comprehensive Income ((Loss) for the period 13577.10 (59194.13)
Total Comprehensive Income for the period- Attributable to Owners
13580.78 (59194.13)
Balance brought forward 21972.63 86966.84
BALANCE AVAILABLE FOR APPROPRIATION 35553.39 27772.71
Less :Dividend 4811.14
Ii) Less :Tax on Dividend 988.94
BALANCE CARRIED FORWARD 35553.39 21972.53
• Capital Reserve Is created from the Grant received from the Government of India during the approval of Financial Re-structuring proposal by Ministry of Mines and out of Capital Profits over the years.Thls Reserve Is not created out of Revenue Profits of the Company.
•• Currency Fluctuation Reserve Is not created out of Revenue Profits of the Company.
F-436
LONG TERM LOANS
• From Banks/ Hs
• Seo.sred - EYJM Bank (Lean II)
(First pan-passu charge on movable fixed assets, both present and future of the Company, excluding GCP and TCP)
SBI
(First pari-passu charge on immovable lived assets of the Company located at MCP, both present and future , excluding leasehold land/properly)
- U81
(First parkpassu charge on immovable feed assets of the Company located at MCP. both present and future , excluding leasehold land/property)
11CIFC
(First parkpassu charge on Immovable Fixed assets of the Company located at MCP, both present and future , exciudng leasehold land/property)
• AXIS
(First paritassu charge on immovable rued assets of the Company located at MCP, both present and future , excluding leasehold land/property)
- Federal Bank (First parkpassu charge on immovable feed assets of the Company located at KCC, both present and future , excluding leasehold land/property)
- Unsecured
- Exlm Bank
17856.11 22647.53
15410.00 18975.00
9650.00 9800.00
9000.00 9500.00
8147.00 2695.1:0
16668 00
8000.013
PARTICULARS
As at 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
TOTAL
84731.11 63617.53
As al 31st December .2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
Others (Compensation received from Govt of Jharichand for repair of township) 843.53 843.53
TOTAL
843.53 843.53
PARTICULARS
As at 31st December •2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
9107.66 9032.66
PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 9032.66 10920.32
Additions during the year 75.00
Amount used during the year 188746
CLOSING BALANCE
PROVISION FOR EMPLOYEE BENEFITS
PROVISION FOR GRATUITY
AS PER LAST BALANCE SHEET (2466.73) (5448.73)
1575.00 2982.00 Additions during the year
Amount used/funded during the year
CLOSING BALANCE
TOTAL
(891.73) (2468.73)
8215.03 e565.93
(Refer Nola Na. 39 General Notes on Accounts Point No. 20)
NON-CURRENT FINANCIAL UABILITIF-S • Note No 20 BORROWINGS n lakh)
Note No 21 NONCURRENT FINANCIAL LIABILITIES - OTHERS g in lac)
Note No 22 NON - CURRENT -PROVISIONS (Z in lakh)
F-437
PARTICULARS
As at 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
I)
fri
Total outstanding dues of mkro entreprises and small enterprises
Total outstanding dues of crecntors other than micro enperprises and smell enterprises
730.94 961.60
15550.26 22412.82
TOTAL
16281.20 23 74.42
As at 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Audited)
I) Interest accrued but not due on borrowings & term loans 466.97 505.95
It) Unpaid dividend 15.56 20.31 iii) Deposits( Retention money 6993.48 6361.31 iv) Other liabilities 1592.10 1694,61
9068.11 8582.21
Note No 23 CURRENT FINANCIAL UABILMES - BORROWINGS (T in lakh)
PARTICULARS As at 31st December ,2020 (Unaudited) Reviewed
As at 31st March, 2020 (Audited) ?j
SHORT TERM LOANS
- Cash Credit- From Banks/ Fls 4000.48 13603.41
- WCDL- From Banks/ Fla 16300.00 - Secured (Secured by hypothecation of Stock-In-
Trade,Stores & Spare Parts and Book Debts, both present and future of the Company)
- Working Capital Term Loan (Unsecured) - AldS Bank 4550.00 221300.00
- Kotak Mahindra Bank 5000.00
- HDFC Bank 10500.00
• 106 1250.00
- DEO 10000.00 1250.00
LONG TERM LOANS
• Due in next 1 year
- EXIM Bank (Loan I) 2879.25 5933.16
- EXIM Bank (Loan II) 9000.00 8109.39
- Ads Bank 2500.00 8105.00
- HDFC Bank 750.00 500.00
- Vol Bank 300.00 200.00
- SBI ECB 3000.00
- Federal Bank 3332.00
- EXIM Bank 2000.00
TOTAL
42310.73 92749.96
Note No 24 CURRENT FINANCIAL LIABILITIES - TRADE PAYABLE n lakh)
Note No 25 CURRENT FINANCIAL LIABILITIES OTHERS (!in lakh)
Note No 26 OTHER CURRENT LIABIUTIES IT in lakh)
PARTICULARS
Mat 31st December ,2020 As at 31st March, 2020
(Unaudited) Reviewed (Auditedi
6235.60 5763.29
5479.59 3105.82
9375.38 8115.70
16384.81
I) Statutory dues payables
ip Advances from Customers
it) Sundry Creditors - Others
TOTAL
F-438
PARTICULARS
As .131st December 2020 As at 31s1 March, 2020
(Unaudited) Reviewed (Audited)
Additions during the year Len: Refund pedalling to eadier years Less :Advance Income Tax &TOS
Current Tax Liabilities (Net of Advance Tax & TDS)
3832.00
3932.00
Note No!? CURRENT PROVISIONS (tin lath)
PARTICULARS
As at 31s1 December ,202-0 As at 31st March. 2020
(Unaudited) Reviewed (Audited) g
a) PROVISION FOR EMPLOYEE BENEFITS
0 PROVISION FOR LEAVE ENCASHMENT
AS PER LAST BALANCE SHEET 150188 1980.85
Additions during the year
Amounl used during the year 386.97
CLOSING BALANCE 1593.83 159388
Ii) PROtASION FOR GRATUITY
AS PER LAST BALANCE SHEET (2E131.41) (2135039)
Additions during 1he year 29.48
Amount used dtergig the year
CLOSING BALANCE (2831.41) (2831.41)
111) PROVISION FOR LEAVE TRAVEL CONCESSION (LTC)
AS PER LAST BALANCE SHEET 198.03 171.93
Additions during the year 26.10
Amount used dudng the year
CLOSING BALANCE 195.03 198.03
iv) PROVISION FOR PRPANCENTIVE
AS PER LAST BALANCE SHEET 1145.00 1727.00
Additions during the year 176.00
Amount used during the year 58200
CLOSING BALANCE 1321.00 1145.00
v) PROVISION FOR WAGE REVISION
AS PER LAST BALANCE SHEET 1878.87 4256.27
Additions during the year
Amount used during the year 2379.40
CLOSING BALANCE 1878.87 1878.87
OTHERS
DIVIDEND
AS PER LAST BALANCE SHEET
Additions during the year
Amount used during the year
CLOSING BALANCE
ID TAX ON DIVIDEND
AS PER LAST BALANCE SHEET
Additions during the year 988.94
Amount used during The year 988.94
CLOSING BALANCE
110 PROVISION • OTHERS
AS PER LAST BALANCE SHEET 1078.67 1019.67
Additions during the year 157.65 329.76
Amount used during the year 0.57 270.96
CLOSING BALANCE 1215.75 1075.67
4811.14
4811.14
TOTAL
(Refer Note No. 39 General Wes on Accounts Point No. 19 & 20)
3398.12 3063.04
Nate No 28 CURRENT TAX LIABILITIES (Net) IT In lakhl
F-439
Note No 29 REVENUE FROM OPERATIONS 2 j (, In lakh)
PARTICULARS For the Nine Months ended 31st
December , 2020 (Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
SALE OF PRODUCTS -Domestic 56782.95 34187.32 - Export 68325.69 46129.33
125108.64 80316.65 Less : Discount & Rebate - SALES (Net of Discounts) (A) 125108.84 80316.65
SALE OF SERVICES (B) 78.55 310.79
OTHER OPERATING INCOME (C) -Sale of Scrap 514.00 329.54 -Interest from Customers
-Interest from Contractors against mobilization for mining operations
advances 2.36
5699
116.11
252.49
- Penalty & Liquidated Damages 691.60 1920.36 Less : Refunded during the year 2.09 689.51 60.69 1859.67
TOTAL (C) 1264.86 2557.81
TOTAL (MIN-C) 126462.05 83185.25
Note No 30 OTHER INCOME (tin lakh)
PARTICULARS For the Nine Months ended 31st
December , 2020 (Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
- Claims Received 3.42 8.80
- Interest from Term Deposfts 22.79 29.63
- Interest - Others 3.16 992.27
- Profit on sale of Assets •
- Profit on Fair Value of Investment 0.38 0.63
.Others 1542.19 2384.06
- Provisions not required written back # 981.69 2280.83
TOTAL 2663.83 5696.22
Details of Provisions not required written back 0 (Refer Note No.39 General Notes on Accounts Point No.11)
Bad and doubtful Debts,advancesideposits & claims 0.90 56.57
Excess provisions on account of shortagenon- moving,obselete & insurance Stores & Spares and finished goods
(0.01) 266.54
Provision for Discarded Assets no longer required - -
Pray Written back for feasibility study of Concentrator plant at MCP
827.46
Provision for CSR no longer requied Written Beek • -
Provision for Interest on MSME 224.88 264.01 PrOviSidl for MP Rural Infrastructure & Road Development . Tax & Water Charges Excess Provision created for Transportation of Copper 0.00 17656 Concentrate from KCC to load port
Old Liability Written Back for S.Creditors, SD & EMD more than 5 years MA Others
755.90 686.69
TOTAL 081.67 2280.83
F-440
g2- (T In lakh) Note No 31 COST OF MATERIALS CONSUMED
PARTICULARS For the Nine Months ended 31st
December, 2020 (Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
Raw Materials Consumed
483.29
Vake of Ore Raised During Mine Development
161.07
144.95
TOTAL
161.07
628.24
Note No 32 CHANGES IN INVENTORIES OF FINISHED GOODS, SEMI-FINISHED AND WORK- IN-PROCESS IT in lakh)
For the Nine Months ended 31st December, 2029
(Unaudited) Reviewed
For the year ended 315t March, 2029 (Audited)
A. OPENING STOCK: Finished Goods 83.00 1176.03
Semi-Finished and In-Process 64456.03 58249.42
TOTAL OPENING STOCK 64639.03 59426.45
B. CLOSING STOCK: Finished Goods 83.00 83.00
Semi-Finished and In-Process 3193922 6445603
TOTAL CLOSING STOCK 32021.22 64639.03
(INCREASEK DECREASE (A-B) 32517.81 (5113.58)
ENEFTT EXPENSE (t in lakh)
PARTICULARS For the Nine Months ended 3151 For the year ended 31st March, 2020 December , 2020 (Audited)
(Unaudited) Reviewed
Salaries, Wages & Allowances 149E4.54 218015.24
Bonus/Ex-gratia/Perfonnance Related Pay 262.53 104.00
Contribution to Provident & Other Funds 1458.34 2166.55
Workmen & Staff Welfare Expenses 894.94 1568.32
Gratuity & Leave Encashment 2043.63 297.20
TOTAL 19621.98 25962.31
Explanatory Note: - The detail of Remuneration pan/payable to Directors as included in above payments are as follows: -
(i) Salaries & Allowances 153.84 153.84
(ii) Contribution to Provident & Other Funds 13.18 13.18
gig Re-imbursement of Medical Expenses 1.06 1.06
(iv) Leave Encashment 32.83 32.83
(v) Gratuity paid 20.00 20,00
(vi) Other Benefits 29.68 29.68
TOTAL 250.59 250.59
In ad&tion the VVnole-time Directors are allowed the use of company car for private purpose and have been provided with residential accornodation as per terms of their appointment / Government guidelines and the charges am recovered at the rates prescribed by the GovemmenL
F-441
IT in lath) Note No 34 FINANCE COST
PARTICULARS For the Nine months ended 31st
December. 2020 (Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
2001.93 4039.96
1339.00 3764.52
• Interest on Cash Credt - Others ( induding Term Loans)
TOTAL 6041.89 5103.52
PENSE IT in lath)
PARTICULARS For the Nine Months ended 31st
December , 2020 (Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
A. DEPRECIATION Depreciation for the year 3319.29 4036.90
Less: Depredation transferred to Mine Development 213.33 446.57 Expenditure SUB TOTAL (A) 3105.96 3590.33
B. AMORTISATION Amortisation during the year • 17073.67 25271.73
SUB TOTAL (B) 17073.67 25271.73
TOTAL (A4B) 20179.63 26662.06
• Amortisation during the year Is In relation to the expenses Incurred on mines which are under operation/production and does not include expenditure on prospecting of minerals In new mines area.
(Tin lakh)
PARTICULARS
For the Nine Months ended 31st December, 2020
(Unaudited) Reviewed
For the year ended 31st March, 2920 (Audited)
A OTHER MANUFACTURING EXPENSES
- Stores ,Spere58 Tools Consumed 484125 10618.82
- Consumption of Power. Fuel 8 Water 8624.34 17757.59
-Royalty, Coss & Decretal amount 8222.52 7717.04
Contradual Job for Process - 8810.32 16744.17
- Handing & Transportation 2817.32 2975.64
- Expenses for Leasehold Land 134.41 206.61
SUB TOTAL (A) 30450.16 5601927
8. REPAIRS & MAINTENANCE 8 MAJOR OVERHAUL EXPENSES
- Bonding 22.30 145.54
• Machinery 1946.21 41303.83
- Others 295.68 817.77
SUB TOTAL (2) 2264.19 4967.14
C. ADMINISTRATION EXPENSES
• Insurance 409.04 383.85
• Rent 85.29 133.213
- Rates and Taxes 278.51 1132.38
- SeoJdty Expenses 1041.92 804.49
- TravdIMg and Conveyance 110.94 410.12
- Telephone, Telex and Postage 67.13 129.93
- Advertisement and PubAcIty 45.34 246.45
- Printing and Stationery 10.38 70.15
-Books 8 Periodicals 0.54 1.81
- Consultancy Charges- Indigenous 213.21 1006.15
- Less on Sale of Assets(Net) 0.06 2.134
- MTM Debiti(Credig Foreign Exchange (83.33) -20.60
-Exchange Rate Variation (Net) -
- Corporate Social Responsibility Expenses 46.47 331.01
- Hire Charges 130.03 29918
- Audi Expenses (Refer detail below at 55 1) 15.41 42.41
- Independent Directors Expenses 13.20 12.75
- Bank charges 73.06 176.93
- Other General Expenses 615.06 1241.43
SUB TOTAL (C) 3081.06 6404.14
D. PROVISIONS (Refer detail below at S4 2) 559.97 18866.24
TOTAL (A 13•C D) 3e355_38 862 7.39
F-442
For the Nine Months ended 31st December, 2020
(Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
CURRENT TAX
Income Tax Provision
Income Tax relating to earlier years
Deferred Tax ACO3l1111
TOTAL 347.15 3138.01
38321)0
(34134.85)
842.18
2295.83
Note No 36 OTHER EXPENSES
(Contd.)
R In lath)
PARTICULARS For the Nine Months ended 31st
December 2020 , (Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
Explanatory Note: -
1) Detail of Audit Expenses are as under -
i) Statutory Auditors
- Statutory Audit Fees 0.00 16.65
- Tax Audi Fees 3.30 5.16
-In Other Capacity 11.18 14.95
- Reimbursement of Expenses
ii) Cost Auditors
0.27 14.75 2.29 39.05
- Cost Audit Fees • 0.70
- Reimbursement of Expenses
iii) Internal Auditors
0.01 0.01 0.47 1.17
• Audit Fees - 0.65
• Reimbursement of expenses 0.65 0.65 1.54 2.19
TOTAL 15.41 42.41
2) Detail of Provisions are as under: -
Doubtful debts 177.60 0.31
Doubtful advances) deposits 0.00 2.52
Provisions for Obsolete /Non-moving Stores 0.00 1.05
Previsions for WIP 8 Finished Goods 0.00 18,331.80
Provisions for Capital Work In Progress 0.00 131.68
Provisions for Loss of Assets . 0.00
Interest on MSMED 382.37 323.88
Provision for Mine Closure Expenditure 75.00
Provision for Others - -
TOTAL 559.97 18866.24
Note No 37 TAX EXPENSE
(T in 15th)
Note No 38 OTHER COMPREHENSIVE INCOME
(T In latch) For the Nine Months ended 31st
December , 2020 (Unaudited) Reviewed
For the year ended 31st March, 2020 (Audited)
A(i)
A91)
B(9
B(E)
Items that win not be reclassified to Profit/fLoss)
(1500.00) (3020.95)
Adurial galrYloss recognised in the year for employees :
Gratuity
TOTAL (A(i)) (1500.00) (3000.95)
Income Tax relating to items that not be reclassified to Profit !(Loss)
377.52 75828
TOTAL (A(II)) 377.52 755.25
Items that wig be reclassiffed to Profit/(Loss) TOTAL (BM)
Income Tax relating to items that will be reclassified to Profit l(Loss) TOTAL (13(11)) -
F-443
NOTES TO CONDENSED INTERIM UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS a
39 GENERAL NOTES ON ACCOUNTS
1. CONTINGENT LIABILMES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)
(i) Contingent Liabilities: -
a. Claims Claims against the Group not acknowledged as debt :
9 months ended 31.12.2020
(Z in lakh)
2019-20
(!in lakh) i. Disputed VAT / CST / Entry Tax 3516.76 3516.76 H. Disputed Excise Duty 2947.97 2947.97 iii. Disputed Income Tax 23113.43 23113.43 iv. Other Demand 43634.72 39110.70
SUB-TOTAL (A) 73212.88 68688.86 b. Other money for which the Group is contingently liable :
i. Bank Guarantee 1534.33 2767.54 ii. Letter of Credit 93.17 53.26 Hi. Bill discounting -
SUB-TOTAL (B) 1627.50 2820.80 GRAND TOTAL (A+B) 74840.38 71509.66
ii) Commitments:-
Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of advance and deposit) 67835.44 73913.51
2. During the nine months ended 31.12.2020, the Group has made a provision amounting to 176.00 lakh (Previous Year Nil) in terms of DPE guidelines towards Performance Related Pay payable to the executives which is shown under 'Employee Benefit Expense'.
3. Lease premium paid for land for mining purposes including payment for Net Present Value (NPV) of forest area paid to forest department is capitalized under the head Right to Use shown under Note No. 9(c) & 17(h).
4. The lease agreements of Kendadih and Rakha Mining Lease at ICC has been renewed and executed by the Govt of Jharkhand in respect of leasehold lands valid upto 02.06.2023 and 28.08.2021 respectively. In respect of Surda Mining Lease, the lease agreement has expired on 31.03.2020 and the Group has applied for extension of the lease agreement with the Govt of Jharkhand. Govt of Jharkhand has issued Letter of Intent (L01) for extension of the lease vide letter dated 05.08.2020. Formal letter of extension of the lease is under active consideration of the Department of Mines & Geology, Govt of Jharkhand, Ranch'.
5. The commercial operation of Smelter, Refinery and Sulphuric Acid Plant at Khetri Copper Complex (KCC) were suspended since December 2008. The Group suffered loss on account of impairment of the said plants valued by an independent consultant in earlier years and consequently a total sum of 464.01 lakh was provided in the accounts for impairment loss in compliance with the guidelines of IND AS 36 on "Impairment of Assets" as on 31.12.2020. Total inventory valued Z 8.06 lakh (Previous Year 33.21 lakh) which remained as process material in the above Plant is included in the Inventory of the Group. The management is of the opinion that such inventories consisting mainly of metal content and having realizable value at least equal to the amount at which they are stated.
F-444
6. The title deeds for Freehold and Leasehold Land and Building acquired in respect of c Gujarat Copper Project (GCP) with book value of 5365.75 lakh are yet to be executed 0 (Previous year 5578.11 lakh).
7. At ICC, Pollution Control Plant under Package I & Ill amounting to! 2100.50 lakh have not been capitalized for want of completion of trial / guarantee run as per terms of contract. As a matter of prudence, full provision for the same has been made in the accounts to take care of efflux of time over the years.
8. During the nine months ended 31.12.2020, the Group has spent a sum of! 46.47 lakh on account of Corporate Social Responsibility (CSR) expenses.
Amount spent during the year on:
Srl. No.
Particulars in cash In cash Yet to be paid Total
(i) Construction/acquisition of any asset -
(ii) On purposes other than (i)above
Z 46.47 lakh - ! 46.47 lakh
9. Information related to Micro, Small and Medium Enterprises Development Act, 2006 as on 31.12.2020 is disclosed hereunder:
a) i) Principal amount remaining unpaid to any supplier at the end of the financial year
! 384.43 lakh
ii) Interest due on above Z 299.00 lakh
b) Amount of interest paid by the buyer in terms of Section 16 of the Act, along with amount of payment made beyond the appointed date during the year
-
c) Amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the due date during the year) but without adding the interest specified under the Act
Z 837.34 lakh
d) Amount of interest accrued and remaining unpaid at the end of the financial year
! 1136.34 lakh
e) Amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues as above are actually paid to the Small enterprise, for the purpose of disallowance as a deductible expenditure under Section 23 of the Act
! NIL
The information has been given of such vendors to the extent they could be identified as "Micro and Small" enterprises on the basis of information available to the Group.
F-445
10. During the nine months ended 31.12.2020, the Group has written back old liabilities / provisions amounting to 981.69 lakh (Previous Year 2280.83 lakh) in the accounts, the details of which are as under :-
SI. S No.
PARTICULARS Z in lakh
REASONS FOR REVERSAL
1. Excess provision for doubtful debts no longer required is written back in TCP -! 0.04 lakh
0.04 The relevant amount of debts were recovered from the customers/parties and hence the provision for doubtful debts created in earlier years has been written back.
2. Excess provision for doubtful advances no longer required is written back in KCC -! 0.86 lakh
0.86 The relevant amount of advances were recovered from the parties and hence the provision for doubtful advances created in earlier years has been written back.
3. Excess provision for interest on MSME is written back in TCP - Z 0.07 lakh & MCP -! 224.81 lakh
224.88 Excess provision for interest on MSME created in earlier years has been written back.
4. Liability for unclaimed EMD, SD, Sundry Creditors & Advance from customers for more than 5 years written back at HO - Z 10.81 lakh, RSON - ! 39.66 lakh, MCP - Z 425.01 lakh, TCP - Z 0.65 lakh, RSOW - ! 64.03 lakh, RSOS - Z 26.23 lakh & RSOE -! 189.52 lakh
755.91 The unclaimed liability for EMD, SD & Sundry Creditors unmoved for more than 5 years has been written back
TOTAL 981.69
11. Management has not become aware of any instance of fraud by the Group or any fraud on the Group by its officers and employees during the current nine months ended 31.12.2020.
12. The Group has closed / suspended many of its mining operations located at various places, Fertilizer Plant at Khetri in different years due to their uneconomic operations. As per requirement of IND AS 105 on "Non-current Assets Held for Sale and Discontinued Operations" the following information for nine months ended 31.12.2020 are furnished:
(Z in lakh) Previous year fi ures in brackets)
MSB GROUP OF MINES
RCP CCP DCP Fertilizer Plant
i) Initial disclosure event 1997 to 2001 2002 1994 2001 (Year of closure) 2003
ii) Carrying amount of No separate 470.49 - - No separate Assets records (490.05) (-) (-) records are
iii) Liabilities to be settled maintained 137.17 73.04 3.38 maintained (137.17) (73.04) (3.38)
iv) Amount of income - - - (-) (-) (-) (-)
v) Amount of expenses - 26.14* - - (-) (34.70) (-) (-)
vi) Gain on sale of assets - - (Included in iv above) (-) (-)_ . (-) (-) _ _. *This is included in cash generated from operations in the Cash Flow Statement.
F-446
13. Since the Group is primarily engaged in the business of manufacture and sale of copper products, the same is considered to be the only primary reportable business segment and accordingly has been reported. As the Group operates predominantly within the geographical limits of India, no secondary segment reporting has been considered as per IND AS 108 "Operating Segments".
14. Sales for the period include FOB value of Export Sales:-
2020-21 (9 months) 2019-20 Qty (MT) Z in lakh Qty (MT) Z in lakh
Anode Slime 4.600 649.58 25.040 1995.90
Copper Reverts 198.211 808.72 265.347 815.91
Copper Concentrate (CMT) 14118.833 66867.39 10647.339 43317.52
Total 68325.69 46129.33
15. In terms of IND AS 24 on "Related Party Disclosures": The Group does not have any Advances provided to its Subsidiary and Joint Venture Company as at 31.12.2020 except as is disclosed below:
Transactions with Related Party during the year and balance outstanding as on 31.12.2020 in lakh
Name of Related Party
Nature of Relationship
Type of Transaction
9 months ended Year ended 31.12.20 31.03.20
Chhattisgarh Copper Limited (CCL)
Subsidiary Investment in shares as on
33.30 18.50
Advances given as on
- 6.50
Name of Related Party
Nature of Relationship
Type of Transaction
9 months ended Year ended 31.12.20 31.03.20
Khanij Bidesh India Limited
(KABIL)
Joint Venture Investment in shares as on
75.00 3.00
Advances given as on
- 72.00
The remuneration of Key Management Personnel are given below:
Particulars Key Management Personnel Total Remuneration For 9 months ended 31.12.20
Year ended 2019-20
FUNCTIONAL DIRECTORS
Receiving of Services
1. Sri Arun Kumar Shukla Chairman-cum-Managing Director
37.97 12.37 (w.e.f.
01.01,2020)
2. Sri Santosh Sharma Chairman-cum-Managing Director
44.31 (upto 31.12.2019)
3. Sri K D Diwan Chairman-cum-Managing Director
- 1.55 (Arrear PRP)
4. Sri Anupam Anand Director (Personnel)
26.03 10.55 (upto 04.08.2019)
5. Sri S K Bhattacharya - Director (Mining)
93.70 (upto 31.12.2019)
6. Sri S K BandyopadhyaY Director (Finance)
40.15 52.41
7. Sri Arun Kumar Shukla 35.70 Director (Operations)
- (upto 31.12.2019)
OTHER THAN FUNCTIONAL DIRECTORS 8. Sri CS Singh'
Company Secretary 36.24 51.28
F-447
INDEPENDENT DIRECTORS Sri Subhash Sharma - Date Sri Pawan Kumar Dhawan - Sri Balwinder Singh Canth - Sri Kalyansundaram - Date
of appointment - 18.02.2018 Date of appointment - 22.07.2019 Date of appointment - 22.07.2019 of appointment - 22.07.2019
83
SI. No. Payment to Independent Directors For 9 months ended
31.12.2020
Year ended 31.03.2020
1. Sitting Fees 13.20 12.75
Balance Outstanding with Key Managerial Personnel as on 31.12.2020
SI. No. Particulars As on 31.12.2020
As on 31.03.2020
1. Amount payable Nil Nil
2. Amount receivable Nil Nil
16. In terms of IND AS 33 on "Earning per Share" for 9 months ended 31.12.2020: (Z in lakh)
BASIC DILUTED
Profit / (Loss) After Tax 14703.24 (-)56948.46
14703.24 (-) 56948.46
Denominator used: Weighted average number of Equity Shares of Z 5/- 925218000 925218000
(Previous year Z 5/- each) outstanding during the period.
(925218000) (925218000)
Earning Per Share (Z) 1.589 (-)6.155
1.589 (-) 6.155
_ .. . 17. The Group has accountedor UeTerreo
on "Income Taxes" issued by The Institute of Chartered Accountants of India. The Deferred tax balances are set out below:-
Z in lakh) UtrCISISCIJ I /AA tAa.Ji- I
Particulars Deferred Tax Asset/ (Liability)
as at 01.04.2020
Credit/ (Charge) during the
nine months ended
31.12.2020
Deferred Tax Asset/ (Liability)
as at 31.12.2020
Deferred Tax Asset :- Difference between provision made in accounts and claims made as per I. T Act
5864.22 3500.95 9365.17
5864.22 3500.95 9365.17
Deferred Tax Liability :-
Difference between net book value of depreciable capital assets vis-a-vis WDV as per IT Act
(1914.43) (16.10) (1930.53)
(1914.43) (16.10) (1930.53)
Deferred Tax Asset (Net) - Recognised in Statement of Profit & Loss
3949.79 3484.85 7434.64
Deferred Tax Asset (Net) - Defined Benefit Plan - Recognised in OCI
1341.02 377.52 1718.54
Total Deferred Tax Asset (Net) 5290.81 iscsk.
3862.37 9153.18
F-448
18. PROVISIONS FOR CONTINGENCIES (For 9 months ended 31.12.2020: - (!in lakh)
Particulars Discarded Fixed Assets
Capital WIP & Advance
Mines Development Expenditure
Others TOTAL
Carrying amount as at 01.04.2020
1838.56 3392.91 4664.86 32274.97 42171.30
Amount provided during the year
- - 2161.51 2161.51
Amounts utilized against provision
- - 1.33 1.33
Carrying amount as at 31.03.2020
1838.56 3392.91 4664.86 34435.15 44331.46
19. GRATUITY AND OTHER POST-EMPLOYMENT BENEFIT PLANS IN TERMS OF Ind AS 19:
The Group has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded through Life Insurance Corporation of India, SBI Life Insurance Co. Ltd. and India First Life Insurance and are managed by separate trust. The Group has also funded through Life Insurance Corporation of India and SBI Life Insurance Co. Ltd towards leave encashment. Expenses recognized in Statement of Profit & Loss and Other Comprehensive Income for 9 months ended 31.12.2020 amounting to 3584.66 lakh in respect of Gratuity and Leave Encashment is on estimation basis based on the actuarial valuation report of the preceding year.
21. With effect from April, 2019, the Group has adopted Ind AS 116. However, since the Group has no lease liabilities at present, Ind AS 116 has no financial impact on the accounts of the Group during the 9 months ended 31.12.2020.
22. INTEREST IN OTHER ENTITIES
a) Subsidiary
Name of Entity Nature of relationship Proportion of shareholding
Country of incorporation
India Chhattisgarh Copper Limited(CCL)
Subsidiary 74%
b) Associate/Joint Venture
Name of Entity Nature of relationship Proportion of shareholding
30%
Country incorporation
India
of
Khanij Bidesh Limited (KABIL)
India Joint Venture
(i) Commitments and contingent liabilities in respect of Associate/Joint Venture - NIL
(c) Summarized financial information for Associate/Joint Venture as on 31.03.2020 z
Summarized Balance Sheet KABIL Cash & Cash Equivalents 1,58,39,059 Total Assets 1,58,39,059 Equity Share Capital 2,50,00,000 Other Equity (92,13,841) Other Current Liabilities 52,900 Total Equity and Liabilities 1,58,39,059
0
F-449
z Summarized Statement of Profit and Loss KABIL Total Income Nil Other Expenses 92,13,841 Total Expenses 92,13,841 Profit/(Loss) Before Tax for the period (92,13,841) Profit/(Loss) After Tax for the period (92,13,841)
23. The income tax expense for the year can be reconciled to the accounting profit as follows : in lakh
9 months ended 31.12.2020
Year ended 31.03.2020
Profit / (Loss) before Tax 15066.29 (53756.84) Income Tax expense calculated at 25.168% 3791.88 - Effect of Deferred Tax balances due to the change in income tax rates
1534.21
Income Tax effect of earlier years - 842.18 Others (net) 40.12 761.62 Income Tax expense recognized in profit or loss 3832.00 3138.01
The Group elected to exercise the option permitted under Section 115BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment Act, 2019). Accordingly the Group has recognised Provision for Income Tax for the 9 months ended 31.12.2020 and remeasured its deferred tax assets/(liabilities) basis the rates prescribed in the said section.
24. During the nine months ended 31.12.2020 52,000 nos. ( Previous year Nil) equity shares of face value 10/- each have been issued to Chattisgarh Mineral Development Corporation Limited by Chattisgarh Copper Limited for providing consultancy services and no consideration has been received in cash. This represents 26% of the share capital of Chhattisgarh Copper Limited.
25. The value of assets, other than fixed assets and non-current assets, have realizable value at least equal to the amount at which they are stated.
26. Gujarat Copper Project of the Group consists of three units namely, Anode furnace (Smelter). Refinery and KaIdo Furnace having aggregate book value of 22704.69 lakh as at 31.12.2020. The Anode Furnace and Refinery unit has been commissioned in October 2016 while Kaldo unit is commissioned on 25.05.2020. Since commissioning, the plant is being operated at a sub optimal level for want of feed stock. GCP being a secondary smelter, the feed stock are copper scrap, copper blister, liberator cathode etc. The Group has not been able to operate profitably the plant due to various constraints. However, the Group has floated an 'Expression of Interest for Long Term Leasing or Outright Sale of the Gujarat Copper Project located at Bharuch'.
01
F-450
27. Financial Instrument
1. Derivatives not designated as hedging Instruments The Group uses Commodity Futures Contracts to manage its commodity price risk . The Commodity Futures Contracts are not designated as hedging instrumnets and are entered into for periods consistent with commodity price risk exposure of the underlying transactions, generally from one to four months. However during the nine month ended 31st December 2020, the Group has not entered into any Commodity Futures Contract.
The Group uses foreign exchange forward contracts to manage some of its transaction exposures. The foreign exchange forward contracts are not designated as cash flow hedges and are entered into for periods consistent with foreign currency exposure of the underlying transactions, generally from one to four months.
Commodity price risk
The Group purchases copper blister( anode on an ongoing basis for Its operating activities In its Gujarat Copper Project (GCP) plant for the production of cathode. To hedge itself against the volatility in LME copper prices in the international market has led to the decision to enter into commodity future contracts. Howeverduring the nine month ended 31st Decanter 2020, the Group has not purchased any such copper blister/ anode for its plant in GCP.
These contacts, which commenced in August 2016, are expected to reduce the volatlity attributable to price fluctuations of copper. Hedging the price volatility of copper purchases is in accordance with the Risk Management Policy approved by the Board of Directors. The hedging relationships are for a period between 1 and 4 months based on existing purchase agreements. The Group designated only the spot-to-spat movement of the entire commodity purchase price as the hedged risk. It has been decided by the Group not to follow the hedge accounting for these instruments.
Mat 31st December 2020, the fair value of the open position of commodity future contracts is nil.
2. Financial Instruments by Categories The carrying value and fair value of financial instruments by categories were as follows: Set out below, is a comparison by class of the carrying amounts and fair value of the Group's financial instruments, other than those with carrying amounts that are reasonable approximations of fair values:
Amount in ? latch
Particulars Total carrying value as at
December 31,2020 Total carrying value as at March
31,2020 Fair Value as at
December 31,2020 Fair Value as at March 31,2020
Financial Assets at FV through Statement of Profit & Loss
Mutual Funds 7.84 7.84 9.87 9.48
Derivatives not designated as hedges Future Contract Receivable on commodity
Total of Financial Assets 7.84 7.84 9.87 9.48
Financial Liabilities
Derivatives not designated as hedges
Forward Cover Contract Liabiffiv
Total of Financial Liabilities
3. The Management considered the Service fees of Rs 15 lakh paid on the Exim Bank Term loan amounting to Rs. 30300 lath drawn on 29.05.2018 as immaterial, as the amount of service fee was only 0.012% of the Turnover for 9 months ended 31.12.2020 of the Group and hence the same was not considered as a transaction cost in terms of fair valuation at Initial recognition under INDAS 109. Further, the Management assessed that for the purpose of IND AS 109, the carrying value of loan is considered as its fair value as no loan could be provided at a rate lower that the rate of interest of Exim Bank loan for similar terms and conditions of the loan at that point of time.
Similarly, the Management considered the total of Upfront fees & Other charges of Rs 245.33 lath paid on the SW ECB loan amounting to Rs. 17734.75 lath drawn during July 2018 to January 2019 as immaterial, as the amount of such fees/charges was only 0.196% of the Tumover for 9 months ended 31.12.2020 of the Group and hence the same was not considered as a transaction cost in terms of fair valuation at initial recognition under INDAS 109. Further. the Management assessed that for the purpose of IND AS 109, the carrying value of loan is considered as its fair value as no loan could be provided at a rate lower that the rate of interest of SBI ECB loan for similar terms and conditions of the loan at that point of time.
The Management assessed that cash and cash equivalents, trade receivables, trade payables, batik overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.
The fair value of the financial assets and liabilities is Included at the amount at which the instrument could be exchanged in a current transaction between vrilling parties, other than in a forced or
liquidation sale. The following methods and assumptions were used to estimate the fair values:
The Group enters Into derivative financial instruments with various counterparties, principally with financial institutions having Investment grade credit ratings. Foreign exchange forward contracts and
commodity futures contracts are valued using valuation techniques. which employs the use of market observable Inputs. The most frequently applied valuation techniques include forward pricing .
4. Fair Value Hierarchy
Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) In active Markets. Level 2- Level 2 hierarchy includes financial instruments measured using inputs other than quoted prices Included within Level 1 that are observable for the asset or liability, either directly (i.e. as
prices) or indirectly (i.e. derived from prices). Level 3 - Level 3 hierarchy Includes financial instruments measured using Inputs that are not based on observable market data (unobservable inputs).
F-451
5 7>
The following table presents fair value hierarchy of assets and liabilities measured at fair value Amount In t lath
Partieulara vo 'Date of Valuation ii- :W--"V:7•Et7.71:.:itft 4—
r,,Levol 1 Level 2 7 Le el 3 ,ll Mi
Financial Assets at FV through Statement & Loss of Profit
Non financial assets -derivative Mutual funds 31-Dec-2020 9.87 9.87
financial assets Derivative Future Contract Receivable on commodity 31-Dec-2020
Liabilities measured at fair value: Derivative financial liabilities Forward Cover Contract Liability 31-Dec-2020
at FV through OCI Assets measured 31-Dec-2020
Amount In lath
w----: --- - ww_wwwwwParticularreseftwww‘y -w- Date of Valuation --,:-:. t:, .-- Level 1 Iwttyt :tteff Level 2 510 tnLevel 3 NS. allgotalefia.
Financial Assets at FV through Statement Loss of Profit &
financial assets Non-derivative funds Mutual 31-Mar-2020 9.48 9.48
financial assets Derivative Future Contract Receivable on commodity 31-Mar-2020
Liabilities measured at fair value: Derivative financial liabilities
Forward Cover Contract Liability 31-Mar-2020 -
at FV through OC1 Assets measured 31-Mar-2020
5. Financial Risk Management Financial risk factors The Group's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Group's p imary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.
- Risk : . - .,.. Exposure arising from . Measurement : : . - Management St
Market risk- Foreign Exchange
Future commercial transactions, Recognised
financial assets and financial liabilities
snsftivity analysis Forward foreign exchange contracts and
natural hedge as sales are also demoniated in foreign excchange.
Market-Commodity Price Risk Purchase of Copper Rica Sensitivity Commodity Futures Contract
Credit risk Trade receivables Ageing analysis Sales are mainly done against Advance or
Letters of Credit
Liquidity risk Borrowings and other
liabilities Rolling cash flow forecasts Cash flow management
F-452
Particulars
Loans -41144.25
?mount inn! lah as al Member 31,2020 Rs. In Iran 'i 764-1:Walra;
Cash & Ann egravelents Trade Recerables EXPORT 6589.01
Trade Prayables
Man (if any) Net Assets/ (-) Uablkhes -41555.35
Rain lab Particulars Cash .1 cash equivalents
751400 Trade Renewable, EXPORT Trade Payables
.55554.08 Loans Ottras Oil any)
-48550.08 Net Assets/ 61 Urairaes
at Market Rok It Fenian Currency Risk The Group operates al intern/Moral level which %Tones the Group% foreign currency risk Irking Mra fraegn crar•tcYllem07-505 raratS7 "or. RrIPEds.eractE and lEreran c.ffe"M b0"01.111 Foreign currency risk pram. from future commercial transactions and recognised essets and 11.bl%. denonvnaled in • currency other then AIR es on reporting data.
'Amount In 7 lakh as of March 31.2020
Sensitiviti lira sensitivity el profit or loss to changers In exchange rate arises mainly horn foreign currency denominatd financial instrument.
P len " impact on profit before taxorraild6
Marimbas 31.2020 l x Myra 3612020
increase by 5% 2,407 22 2703.20
Decrease by 5% 12.407221 M NG 201
Ill Commodity Price Risk Tine Group's exposure to Commodity price horn copper price Pucbation In IrdeMationsl market does net Mira 15th Group hedge% as its imports through Future contracts et LME.
bi Credit Risk Creckt risk refers to the risk ot default on an Motion by the Debtors resulting ki • financial Ihn The &cup sets mMonty of Its products either %Rind Advance Rom Customers or Leeten of Credit Accordingly credit risk horn Trade receivables has not been cosidered swank risk
Credit risk exposure An analysts siege ol trade receivables at each reporting date is summarized es blows:
Amount In 7 Min
Particulars 31-Dec-20 31-Mar-20 Bran Gross
Nat past due Past not more than six montin 6280.07 5712.45
Past due more than EX months hut not more than one year 8040.11 553 2
More than one year 1753.50 2010.21
Total 14182 77 0175.88
Less Allowances for Bed 6 Doubtful Debts 108408 08 51
Net Debtors 13118.50 8289.35
Curious, credit risk IS managed by each bulkiest unit sublectto the GrOup's estsbashed Markebrig poky. procedures and control relating to custOMer cracht rink men% errant Grastandem curtomer rerzeinbln are iegulsrly monitored and any shipments to major customers are genera% covered by letters or cred4 o Odra forms of credk insurance The maximan exposure to crodit irak at the reporting data is Rs 10154.011 Iran lor which (dl provision has been made In the @enougds ais disclosed in Note No 12
Other financial assets Cradl risk relating to cash and cash equivalents is considered neglgible because our COunierpartles are SchedUled banks We consider the me& quality ndTerm depasira with suds banks es mod as these banks are under the regulartory framework Cil Reserve Flank of India We review these banking relationships on an ongoing basis
0) Liquidity Risk Our Rquidity needs are monitored on the bash of mralNy and randy projectIOnS„ The Group'spdndp& trances ol !quirky era crab and cash equivalent:I and cash generated from operations.
We manage our timidity needs by continurasly monitoring cash kraoras and by striving to maInran ednomste cash and cash ratintsients. Net cash requirements are compered to availed' cash in
adorns determine any shortfall. Shoal rain Iquidly requirements annals% mainly ol LoanS. Sundry aerators. Emirate payable, Employee dues *thin Outing the nem% course ot business not each reporting data. We stave to
maintain a sufficient balance in cash and cora equivalents to meet our Short term liquidity requiraMents.
The table brew/ provides details regarding the contractual maturities olfinencial bahaihen. The table he been drawn p based on the undisclosed cash darn of financial labilkies Pined on the sergest date mraitich Ina Group can be required to pain Amount in t' irah as of December 31. 2020
Particulars On Demand thari 3 Less ! month
3 mo ran to 1 veer
1-3 years 3-5 rams 5-7 yens Total
Short term borrowings (cash credos 400048 0.00 0.00 0.08 0.00 0.00 4000 48
Shad term borrowings Mineral 0.06 7050.00 7500.00 0.00 0.00 0.00 14550.00
Lane Tenn Borrowings 0.00 250.00 27001 00 8004200 13107.38 000 105491 35
Total 4000.48 7300.00 3493100 0043110 13197.35. 000 127041.61
Aries t in 7 lakn as of M rub 31, 2020
Particulars On Dem Less then 3
month, 3 months to 1
and veer 1-3 years 3-5 pare Total
Short term borrowings lash credit) 1280341 13503.41
Short term borrowings (Others) %MO 00 5900060 553130.00
Long Term Sonoran°, 2175.40 1051679 41518.70 1112507 85484.013
Total 1360241 38075.00 30015.79 61545.79 12225.00 155357.40
Natfication No R131/2010-20.185 dated 27.03.2020s meived ran un et COVID-I6 Regulatery Package .
5. tiaras. Management For the purpose cil the Group's capital management capital includes issued equity caplal and al other amity reserves atributabi• to lhe Group. The primer/ obieravra of the Groupa caplet
management into maximise the shareholder value.
F-453
28. Copper ore tailing (COT) beneficiation plant was set up at MCP unit for extraction of valuable minerals and metals from copper ore tails with a capacity of 10000 tonnes per day (TPD) at an estimated cost of 20000 lakh. The intermittent trial run failed on number of occasions (chockage/ spillage, stoppages, cleaning etc) and the quality and quantity of products achieved at various stages are not as per the parameters envisaged in contract agreement. A preliminary notice was issued to the party to complete the project and commission the same. The party agreed to commission the plant, but the progress of the work at site was stopped due to lockdown for COVID-19 pandemic. The Group has extended the timeline upto 31.08.2020 for supply, erection of the thickener and commission of the plant. But the party failed to execute the contract and the contract got terminated with efflux of time.
29. Consequent upon the Judgment of Common Cause dated 02.08.2017, which is applicable only to the mining leases of iron and manganese ore, passed by the Apex court in the case of Common Cause Vs U01 and others, a demand of 4353.78 lakh was raised by the District Mining Officer of Jamshedpur for running the Surda mine without valid environment clearance (EC) although Surda mine has a valid mining lease, forest clearance and it has adhered to the terms of approved mining plan and it was working on valid Consent to Operate. Based on the Revision Application filed by the Group, the Revisional Authority of the Ministry of Mines, after hearing at length both parties had issued specific direction against the District Mining Officer (DMO) not to take any coercive measures in terms of recovery of the said demand. On revision of demand from 4353.78 lakh to 12690.49 lakh by the office of the District Mining Officer and subsequently revised to 92940.06 lakh by the State Government, the Group again appealed before the Revisional Authority and hearing was held on 14.11.2019 and interim stay is granted by the Revisional Authority till the next date of hearing. Since at present mining leases of copper ore are not included under Common Cause Judgement, the Management, based on the legal opinion, is of the view that the same has not to be shown as Contingent Liability as on 31.12.2020.
30. The cost of production per unit has gone up owing to low volume of production during the nine months ended 31.12.2020 due to measures taken by the Government of India to contain COVID-19 pandemic situation prevalent in the country. Post unlocking of the lockdown, the Group's operations are gradually stabilizing. The Group has considered the possible effects that may result from COVID-19 in the preparation of these financial results including recoverability of carrying amounts of financial and non-financial assets. The will continue to closely monitor any material changes arising out of future economic conditions and the resultant impact on its business.
31. The Group has not changed any accounting policies during preparation of Condensed Interim Unaudited Financial Statements for Nine months ended 31st December 2020 w.r.t to accounting policies of previous financial year. This Condensed Interim Unaudited Financial Statements has been prepared by the Group for internal use with regards to the proposed Qualified Institutional Placement of equity share of the Group. Accordingly ,this financial statement should not be used ,referred to or distributed for any other purpose.
32. The previous year's figures are not comparable with the current period figures since the current period consists of 9 months. The previous year's figures have been regrouped / rearranged, wherever necessary.
F-454
205
DETAILS OF PROPOSED ALLOTTEES
The names of the proposed Allottees and the percentage of post-Issue share capital (assuming that the Equity Shares
are Allotted to them pursuant to the Issue) that may be held by them, is set forth below:
Sr.
No.
Name of the proposed Allottees Percentage of the post-Issue
share capital held (%)^*
1 LIFE INSURANCE CORPORATION OF INDIA 11.7910
2 SBI MAGNUM COMMA FUND 0.1038
3 SBI PSU FUND 0.0865
4 SBI LONG TERM EQUITY FUND 0.4323
5 SBI INFRASTRUCTURE FUND 0.0432
6 SBI LARGE & MIDCAP FUND 0.2992
7 ICICI PRUDENTIAL BUSINESS CYCLE FUND 0.1614
8 ICICI PRUDENTIAL BHARAT CONSUMPTION FUND - SERIES 1 0.0530
9 ICICI PRUDENTIAL BHARAT CONSUMPTION FUND-SERIES 3 0.0072
10 ICICI PRUDENTIAL MANUFACTURE IN INDIA FUND 0.0513
11 ICICI PRUDENTIAL COMMODITIES FUND 0.1006
12 ASHOKA INDIA OPPORTUNITIES FUND 0.3918
13 WHITE OAK INDIA EQUITY FUND 0.0979
14 KUBER INDIA FUND 0.3594
15 TARA EMERGING ASIA LIQUID FUND 0.0432
16 INDIAN BANK 0.1816
17 PUNJAB NATIONAL BANK 0.0605
18 BANK OF INDIA 0.0242
19 YES BANK LIMITED 0.0216
20 VIKASA INDIA EIF I FUND 0.2228
21 AURIGIN MASTER FUND LIMITED 0.1782
22 GOLDMAN SACHS (SINGAPORE) PTE. - ODI 0.0692
23 CITIGROUP GLOBAL MARKETS MAURITIUS PRIVATE LIMITED - ODI 0.0346
24 NOMURA SINGAPORE LIMITED 0.0364
25 THE NEW INDIA ASSURANCE COMPANY LIMITED 0.2427
26 QUANT MUTUAL FUND - QUANT ACTIVE FUND 0.1384
27 QUANT MUTUAL FUND - QUANT SMALL CAP FUND 0.1155
28 QUANT CAPITAL TRUSTEE LTD A/C QUANT MUTUAL FUND-TAX PLAN 0.0191
29 QUANT MUTUAL FUND - QUANT MID CAP FUND 0.0026
30 QUANT MUTUAL FUND - QUANT ABSOLUTE FUND 0.0046
31 QUANT MUTUAL FUND - QUANT MULTI ASSET FUND 0.0041
32 QUANT MUTUAL FUND - QUANT ESG EQUITY FUND 0.0026
33 QUANT MUTUAL FUND - QUANT FOCUSED FUND 0.0036
34 QUANT MUTUAL FUND A/C QUANT INFRASTRUCTURE FUND 0.0044
35 QUANT MUTUAL FUND - QUANT CONSUMPTION FUND 0.0006
36 CENTRAL BANK OF INDIA 0.3578
37 IDBI LONG TERM VALUE FUND 0.0062
38 IDBI DIVIDEND YIELD FUND 0.0062
39 MORGAN STANLEY ASIA (SINGAPORE) PTE. 0.0178
^ Based on the beneficiary position as on April 9, 2021 (adjusted for Equity Shares Allocated in the Issue).
*The post-Issue shareholding pattern (in percentage terms) of the proposed Allottees has been disclosed on the basis
of their respective PAN, except in case of Mutual Funds, Insurance Companies and FPIs (investing through different
sub-accounts having common PAN across such sub-accounts) wherein their respective DP ID and Client ID has been
considered.
206
DECLARATION
Our Company certifies that all relevant provisions of Chapter VI read with Schedule VII of the SEBI ICDR
Regulations have been complied with and no statement made in this Placement Document is contrary to the provisions
of Chapter VI and Schedule VII of the SEBI ICDR Regulations and that all material approvals and permissions
required to carry on our Company’s business have been obtained, are currently valid and have been complied with .
Our Company further certifies that all the statements in this Placement Document are true and correct.
Signed by:
_____________
ARUN KUMAR SHUKLA
CHAIRMAN AND MANAGING DIRECTOR
Date: April 12, 2021
Place: Kolkata
207
DECLARATION
We, the Board of Directors of the Company, certify that:
(i) the Company has complied with the provisions of the Companies Act, 2013 and the rules
made thereunder;
(ii) the compliance with the Companies Act, 2013 and the rules thereunder does not imply that
payment of dividend or interest or repayment of preference shares or debentures, if
applicable, is guaranteed by the Central Government;
(iii) the monies received under the offer shall be used only for the purposes and objects
indicated in the Placement Document (which includes disclosures prescribed under Form
PAS-4).
SIGNED OF BEHALF OF THE BOARD OF DIRECTORS
Signed by:
_________________
ARUN KUMAR SHUKLA
CHAIRMAN AND MANAGING DIRECTOR
Date: April 12, 2021
Place: Kolkata
I am authorized by the Board of Directors of the Company, vide resolution dated April 12, 2021 to sign this form and
declare that all the requirements of Companies Act, 2013 and the rules made thereunder in respect of the subject matter
of this form and matters incidental thereto have been complied with. Whatever is stated in this form and in the
attachments thereto is true, correct and complete and no information material to the subject matter of this form has
been suppressed or concealed and is as per the original records maintained by the promoters subscribing to the
Memorandum of Association and the Articles of Association.
It is further declared and verified that all the required attachments have been completely, correctly and legibly attached
to this form.
Signed by:
_________________
ARUN KUMAR SHUKLA
CHAIRMAN AND MANAGING DIRECTOR
Date: April 12, 2021
Place: Kolkata
208
SAMPLE APPLICATION FORM
An indicative format of the Application Form is set forth below:
Hindustan Copper Limited
APPLICATION FORM
Name of the Bidder ____________
Form. No._____________________
Date: ______________
Hindustan Copper Limited (the “Company” or the “Issuer”) was incorporated as a government
company under the provisions of the Companies Act, 1956 as Hindustan Copper (Private) Limited by a certificate of incorporation dated November 9, 1967 from the Registrar of Companies, Jaipur,
Rajasthan. Subsequently, our Company became a public limited company pursuant to a
shareholders’ resolution dated February 27, 1968 and the name of our Company was changed to Hindustan Copper Limited and our Company received a fresh certificate of incorporation on March
26, 1968.
Registered and Corporate Office: Tamra Bhavan, 1, Ashutosh Chowdhury Avenue, Kolkata 700
019, West Bengal, India. Telephone:+91 33 22832224; Facsimile:+91 33 2283 2478;
E-mail: : singhi_cs@hindustancopper.com; Website: www.hindustancopper.com ;
CIN: L27201WB1967GOI028825
QUALIFIED INSTITUTIONS PLACEMENT OF UP TO [●] EQUITY SHARES OF FACE VALUE ₹ 5 EACH (THE “EQUITY SHARES”)
FOR CASH, AT A PRICE OF ₹ [●] PER EQUITY SHARE (THE “ISSUE PRICE”), INCLUDING A PREMIUM OF ₹ [●] PER EQUITY
SHARE, AGGREGATING UP TO ₹ [●] LAKH UNDER CHAPTER VI OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE
OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2018, AS AMENDED (THE “SEBI ICDR REGULATIONS”) AND
SECTION 42 OF THE COMPANIES ACT, 2013, AS AMENDED (THE “COMPANIES ACT”), READ WITH RULE 14 OF THE COMPANIES
(PROSPECTUS AND ALLOTMENT OF SECURITIES) RULES, 2014, AS AMENDED (THE “PAS RULES”) AND OTHER APPLICABLE
PROVISIONS OF THE COMPANIES ACT, 2013 AND RULES FRAMED THEREUNDER, EACH AS AMENDED BY THE COMPANY AND
SUCH ISSUE, (THE “ISSUE”). Only Qualified Institutional Buyers (“QIBs”) as defined under the SEBI ICDR Regulations and which: (a) are not excluded pursuant to
Regulation 179(2)(b) of the SEBI ICDR Regulations; (b) are not restricted from participating in the Issue under SEBI ICDR Regulations and
other applicable laws; (c) hold a valid and existing registration under the applicable laws in India (as applicable); and (d) are eligible to invest
in the Issue and submit this Application Form. The Equity Shares have not been and will not be registered under the U.S. Securities Act of 1933,
as amended (the “Securities Act”) or the state securities laws of any state of the United States and, unless so registered, may not be offered, sold
or delivered within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of
the Securities Act and applicable U.S. state securities laws. Accordingly, the Equity Shares are being offered and sold outside the United States
in ‘offshore transactions’ (as defined in Regulation S under the Securities Act) in reliance on Regulation S and the applicable laws of the
jurisdiction where those offers and sales are made. You should note and observe the solicitation and distribution restrictions contained in the
sections entitled “Selling Restrictions” and “Transfer Restrictions” in the accompanying preliminary placement document dated April 7, 2021
(the “PPD”). ELIGIBLE FPIs ARE PERMITTED TO PARTICIPATE IN THE ISSUE IN TERMS OF SCHEDULE II OF THE FOREIGN EXCHANGE
MANAGEMENT (NON-DEBT INSTRUMENTS) RULES, 2019 (“FEMA RULES”). ELIGIBLE FPIs ARE PERMITTED TO BID FOR
EQUITY SHARES IN THE ISSUE SUBJECT TO COMPLIANCE WITH ALL APPLICABLE LAWS AND SUCH THAT THE
SHAREHOLDING OF THE ELIGIBLE FPIs DOES NOT EXCEED SPECIFIED LIMITS AS PRESCRIBED UNDER APPLICABLE LAWS
IN THIS REGARD. PURSUANT TO PRESS NOTE NO. 3 (2020 SERIES), DATED APRIL 17, 2020, ISSUED BY THE DEPARTMENT FOR
PROMOTION OF INDUSTRY AND INTERNAL TRADE, GOVERNMENT OF INDIA, AND RULE 6 OF THE FEMA RULES,
INVESTMENTS BY AN ENTITY OF A COUNTRY WHICH SHARES LAND BORDER WITH INDIA OR WHERE THE BENEFICIAL
OWNER OF SUCH INVESTMENT IS SITUATED IN OR IS A CITIZEN OF SUCH COUNTRY, MAY ONLY BE MADE THROUGH THE
GOVERNMENT APPROVAL ROUTE. ALLOTMENTS MADE TO AIFs AND VCFs IN THE ISSUE SHALL REMAIN SUBJECT TO THE
RULES AND REGULATIONS APPLICABLE TO EACH OF THEM RESPECTIVELY, INCLUDING THE FEMA RULES. FVCIs, NON-
RESIDENT MULTILATERAL AND BILATERAL DEVELOPMENT FINANCIAL INSTITUTIONS AND ANY OTHER NON-RESIDENT
INVESTORS (OTHER THAN ELIGIBLE FPI THROUGH SCHEDULE II OF THE FEMA RULES) ARE NOT PERMITTED TO
PARTICIPATE IN THE ISSUE.
To,
The Board of Directors
Hindustan Copper Limited
Tamra Bhavan, 1, Ashutosh Chowdhury Avenue, Kolkata
700 019, West Bengal, India
Dear Sirs/Madam,
On the basis of the serially numbered PPD of the Company
provided to us and subject to the terms and conditions
contained therein, and in this Application Form, we hereby submit our Bid for the Allotment of the Equity Shares in the
Issue, on the terms and price indicated below. We confirm
that we are an eligible QIB in terms of Regulation 2(1)(ss) of the SEBI ICDR Regulations and are not: (a) excluded
pursuant to Regulation 179(2)(b) of the SEBI ICDR
Regulations; and (b) restricted from participating in the Issue under SEBI ICDR Regulations and other applicable laws and that we are not a promoter of the Company (as defined in the SEBI ICDR Regulations), or any person related to the promoters of the Company, directly or indirectly. Further, we
STATUS (Insert ‘✓’ for applicable category)
FI Scheduled Commercial Banks and Financial Institutions
IC Insurance Companies
MF Mutual Funds VCF Venture Capital
Funds*
NIF National Investment Fund FPI Eligible Foreign
Portfolio Investor**
IF Insurance Funds AIF Alternative*
Investment Fund
SI-
NBFC
Systemically Important Non-Banking
Financial Companies
OTH Others
_____________
(Please specify)
* Sponsor and Manager should be Indian owned and controlled. **Foreign portfolio investors as defined under the Securities and Exchange Board of
India (Foreign Portfolio Investors) Regulations, 2019, as amended
209
confirm that we do not have any right under a shareholders’ agreement or voting agreement entered into with promoters or persons related to promoters of the Company, veto rights or right to appoint any nominee director on the board of the Company. We confirm that we are either a QIBs which is
resident in India, or an Eligible FPIs, participating through Schedule II of the FEMA Rules. We confirm that we are neither a FVCI nor a non-resident
multilateral or bilateral development financial institution. We confirm that the application size / aggregate number of the Equity Shares applied for by us, and which may be Allocated to us thereon does not exceed the relevant regulatory or approved limits applicable to us and further confirm that our Bid does not result in triggering an open offer under the
Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended (the “SEBI Takeover
Regulations”).
We further agree and consent that (i) our names, address, contact details, PAN and bank account details will be recorded by the Company in the format
prescribed in terms of the PAS Rules; (ii) in the event that any Equity Shares are Allocated to us in the Issue, our names (as proposed Allottees) and the percentage of our post-Issue shareholding in the Company will be disclosed in the Placement Document pursuant to the requirements under Form PAS-
4 of the PAS Rules; and (iii) in the event that Equity Shares are Allotted to us in the Issue, the Company will place our name in the register of members
of the Company as a holder of such Equity Shares that may be Allotted to us and in the Form PAS-3 filed by the Company with the Registrar of Companies, West Bengal at Kolkata (the “RoC”) as required in terms of the PAS Rules. Further, we are aware and agree that if we are Allotted more
than 5% of the Equity Shares in the Issue, the Company will disclose our name and the number of Equity Shares Allotted to us on the websites of the
National Stock Exchange of India Limited and BSE Limited (together referred to as the “Stock Exchanges”), and we consent to such disclosure. We confirm, that we have a valid and existing registration under applicable laws and regulations of India, and undertake to acquire, hold, manage or
dispose of any Equity Shares that are Allotted to us in accordance with Chapter VI of the SEBI ICDR Regulations and undertake to comply with the SEBI ICDR Regulations, and all other applicable laws, including any reporting obligations. We confirm that, in relation to our application, each foreign
portfolio investor (“FPI”) as defined under the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019, as amended
(other than individuals, corporate bodies, and family offices), and including persons who have been registered under these regulations (such FPIs, “Eligible FPIs”), have submitted separate Application Form, and asset management companies of mutual funds or custodians of mutual funds have
specified the details of each scheme for which the application is being made along with the price and amount to be Allotted under each such scheme. We
undertake that we will submit all such documents, provide such documents and do all such acts, if any, necessary on our part to enable us to be registered as the holder(s) of the Equity Shares that may be Allotted to us. We confirm that the signatory is authorized to apply on behalf of the Applicant and the
Applicant has all the relevant approvals for applying in the issue. We authorise to place our name in the register of members of the Company as holders
of the Equity Shares that may be Allotted to us. We note that the Board of Directors of the Company, or any duly authorized committee thereof, is entitled, in consultation with IDBI Capital Market & Securities Limited and SBI Capital Markets Limited (the “BRLMs”), in their absolute discretion,
to accept or reject this Application Form without assigning any reason thereof. By signing and/or submitting this Application Form, we hereby confirm and agree that the representations and warranties as provided in the “Notice to
Investors”, “Representations by Investors”, “Issue Procedure”, “Selling Restrictions” and “Transfer Restrictions” sections of the PPD and this
Application Form and the terms, conditions and agreements therein are true and correct and acknowledge and agree that these representations, warranties and undertakings are given by us for the benefit of the Company and the BRLMs, each of which is entitled to rely on and is relying on these
representations, warranties and undertakings in consummating the Issue. By signing and/or submitting this Application Form, we hereby represent, warrant, acknowledge and agree as follows: (1) we have been provided a
serially numbered copy of the PPD along with the Application Form, have read it in its entirety including in particular, the section titled “Risk Factors”
therein and we have relied only on the information contained in the PPD and not on any other information obtained by us either from the Company, the
BRLMs or from any other source, including publicly available information; (2) we will abide by the PPD and the Placement Document, this Application
Form, the CAN and the terms, conditions and agreements contained therein; (4) that if we are participating in the Issue as an Eligible FPI, we are not an
individual, corporate body, or family office, (4) that if Equity Shares are Allotted to us pursuant to the Issue, we shall not sell such Equity Shares otherwise than on the floor of a recognised stock exchange in India for a period of one year from the date of Allotment; (5) we will not have the right to
withdraw our Bid or revise our Bid downwards after the Issue Closing Date; (6) we will not trade in the Equity Shares credited to our beneficiary account
maintained with the Depository Participant until such time that the final listing and trading approvals for the Equity Shares are issued by the Stock Exchanges; (7) Equity Shares shall be Allocated and Allotted at the discretion of the Company in consultation with the BRLMs and the submission of
this Application Form and payment of the corresponding Application Amount by us does not guarantee any Allocation or Allotment of Equity Shares to
us in full or in part; (8) in terms of the requirements of the Companies Act, upon Allocation, the Company will be required to disclose names and percentage of our post-Issue shareholding of the proposed Allottees in the Placement Document; however, disclosure of such details in relation to us in
the Placement Document will not guarantee Allotment to us, as Allotment in the Issue shall continue to be at the sole discretion of the Company, in consultation with the BRLMs; (9) the number of Equity Shares Allotted to us pursuant to the Issue, together with other Allottees that belong to the same
group or are under common control, shall not exceed 50% of the Issue. For the purposes of this representation: The expression ‘belong to the same
group’ shall derive meaning from Regulation 180(2) of the SEBI ICDR Regulations i.e. entities where (i) any of them controls, directly or indirectly, through its subsidiary or holding company, not less than 15% of the voting rights in the other; (ii) any of them, directly or indirectly, by itself, or in
combination with other persons, exercise control over the others; or (iii) there is a common director, excluding nominee and independent directors,
amongst the Eligible QIBs, its subsidiary or holding company and any other QIB; and ‘control’ shall have the same meaning as is assigned to it under Regulation 2(1)(e) of the SEBI Takeover Regulations;
We agree to accept the Equity Shares applied for, or such lesser number of Equity Shares as may be Allocated to us, subject to the provisions of the memorandum of association and articles of association of the Company, applicable laws and regulations, the terms of the PPD and the Placement
Document, this Application Form, the CAN upon its issuance and the terms, conditions and agreements mentioned therein and request you to credit the
same to our beneficiary account with the Depository Participant as per the details given below. The amount payable by us as Application Amount for the Equity Shares applied for has been/will be remitted to the designated bank account set out in this Application Form through electronic mode, along
with this Application Form within the Issue Closing Date and such Application Amount has been/will be transferred from a bank account maintained in
our name and in case we are joint holders, from the bank account of the person whose name appears first in the Application Form. We acknowledge and agree that we have not/shall not make any payment in cash or cheque. We are aware that (i) Allocation and Allotment in the Issue shall be at the sole
discretion of the Company, in consultation with the BRLMs; and (ii) in the event that Equity Shares that we have applied for are not Allotted to us in
full or at all, and/or the Application Amount is in excess of the amount equivalent to the product of the Equity Shares that will be Allocated to us and the Issue Price, or the Company is unable to issue and Allot the Equity Shares offered in the Issue or if there is a cancellation of the Issue, or in case of
rejection of Bids or non-allocation of Equity Shares, or if the Application Amount per Equity Shares exceeds the Issue Price per Equity Share, the
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Application Amount or a portion thereof, as applicable, will be refunded to the same bank account from which the Application Amount has been paid by us. Further, we agree to comply with the rules and regulations that are applicable to us, including in relation to the lock-in requirements. In this regard,
we authorize the Company to issue instructions to the depositories for such lock-in requirements, as may be applicable to us. We acknowledge that the Equity Shares have not been and will not be registered under the Securities Act, and may not be offered or sold within the
United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable
state securities laws. By signing this Application Form and checking the applicable box above, we hereby represent that we are located outside the United States and purchasing the Equity Shares in an “offshore transaction” (as defined in Regulation S) in reliance on Regulation S of the Securities Act and
the applicable laws of the jurisdiction where those offers and sales are made. We confirm that we have read the representations, warranties and agreements
contained in the sections entitled “Selling Restrictions” and “Transfer Restrictions” of the PPD.
By signing and/or submitting this Application Form, we further represent, warrant and agree that we have such knowledge and experience in financial
and business matters that we are capable of evaluating the merits and risks of the prospective investment in the Equity Shares and we understand the risks involved in making an investment in the Equity Shares. No action has been taken by us or any of our affiliates or representatives to permit a public offering
of the Equity Shares in any jurisdiction. We satisfy any and all relevant suitability standards for investors in Equity Shares, have the ability to bear the
economic risk of our investment in the Equity Shares, have adequate means of providing for our current and contingent needs, have no need for liquidity with respect to our investment in Equity Shares and are able to sustain a complete loss of our investment in the Equity Shares. We acknowledge that once
a duly filled Application Form is submitted by an Eligible QIB, whether signed or not, and the Application Amount has been transferred to the Escrow
Account, such Application Form constitutes an irrevocable offer and cannot be withdrawn or revised downwards after the Issue Closing Date. In case Bids are being made on behalf of the Eligible QIB and this Application Form is unsigned, we confirm that we are authorized to submit this Application
Form and provide necessary instructions for transfer of the Application Amount to the Escrow Account, on behalf of the Eligible QIB.
BIDDER DETAILS (In Block Letters)
NAME OF APPLICANT*
NATIONALITY
REGISTERED ADDRESS
CITY AND CODE
COUNTRY
PHONE NO. FAX
NO.
MOBILE NO.
FOR FPIs** SEBI FPI REGISTRATION NO.
FOR MFs SEBI MF REGISTRATION NO.
FOR AIFs*** SEBI AIF REGISTRATION NO.
FOR VCFs*** SEBI MF/VCF REGISTRATION NO.
FOR FVCIs*** SEBI FVCI REGISTRATION NO.
FOR SI-NBFCs RBI REGISTRATION DETAILS
FOR Insurance Companies IRDAI REGISTRATION DETAILS
*Name should exactly match with the name in which the beneficiary account is held. Application Amount payable on Equity Shares applied for by joint holders shall be paid from the bank account of the person whose name appears first in the application. Mutual Fund bidders are requested to provide
details of the bids made by each scheme of the Mutual Fund. Each Eligible FPI is required to fill a separate Application Form. Further, any discrepancy
in the name as mentioned in this Application Form with the depository records would render the application invalid and liable to be rejected at the sole discretion of the Company and the BRLMs.
**In case you are an Eligible FPI holding a valid certificate of registration and eligible to invest in the Issue, please mention your SEBI FPI Registration
Number. ***Allotments made to FVCIs, AIFs and VCFs in the Issue are subject to the rules and regulations that are applicable to each of them respectively,
including in relation to lock-in requirement. FVCIs, AIFs and VCFs should independently consult their own counsel and advisors as to investment in and
related matters concerning the Issue.
We are aware that the number of Equity Shares in the Company held by us, together with the number of Equity Shares, if any, Allocated to us in the Issue
will be aggregated to disclose the percentage of our post-Issue shareholding in the Company in the Placement Document in line with the requirements under PAS-4 of the PAS Rules. For such information, the BRLMs have relied on the information provided by the Registrar for obtaining details of our shareholding
and we consent and authorize such disclosure in the Placement Document.
DEPOSITORY ACCOUNT DETAILS
Depository Name (please ‘✓’) National Securities Depository
Limited
Central Depository Services (India) Limited
Depository Participant Name
DP – ID I N
Beneficiary Account Number (16-digit beneficiary A/c. No. to be mentioned above)
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DEPOSITORY ACCOUNT DETAILS
The demographic details like address, bank account details etc., will be obtained from the Depositories as per the beneficiary account given above. However,
for the purposes of refund, if any, only the bank details as mentioned below, from which the Application Amount shall be remitted for the Equity Shares
applied for in the Issue, will be considered.
ESCROW ACCOUNT - BANK ACCOUNT DETAILS FOR PAYMENT OF APPLICATION AMOUNT - REMITTANCE BY WAY OF
ELECTRONIC FUND TRANSFER
REMITTANCE BY WAY OF ELECTRONIC FUND TRANSFER BY 3:00 P.M. (IST), APRIL [●], 2021
Name of the Account HINDUSTAN COPPER LIMITED QIP ESCROW ACCOUNT
Name of the Bank State Bank of India
Address of the Branch of the Bank Capital Market Branch, Mumbai, Main Branch Building, 3rd Floor, Mumbai Samachar Marg, Fort, Mumbai-
400023
Account Type Escrow Account
Account Number 40072486076
IFSC code SBIN0011777
MICR Code 400002224
Tel No. 022 2271 9102
E-mail sbi.11777@sbi.co.in
Kindly make your payment only by way of electronic fund transfers, towards the Escrow Account. Payment of the entire Application Amount should be made
along with the Application Form on or before the closure of the Issue Period i.e. within the Issue Closing Date. All payments must be made in favor of “HINDUSTAN COPPER LIMITED QIP ESCROW ACCOUNT”. The payment for subscription to the Equity Shares to be allotted in the Issue shall be
made only from the bank account of the person subscribing to the Equity Shares and in case of joint holders, from the bank account of the person whose name
appears first in the Application Form. You are responsible for the accuracy of the bank details mentioned below. You are aware that the successful processing of refunds if, any, shall be dependent on the accuracy of the bank details provided by you. The Company and the BRLMs shall not be liable in any manner for
refunds that are not processed due to incorrect bank details.
RUPEE BANK ACCOUNT DETAILS (FOR REMITTANCE)
Bank Account Number
IFSC Code
Bank Name Bank Branch Address
NO. OF EQUITY SHARES BID FOR PRICE PER EQUITY SHARE (RUPEES)
(In Figures) (In Words) (In Figures) (In Words)
TOTAL APPLICATION AMOUNT (RUPEES)
(In Figures) (In Words)
DETAILS OF CONTACT PERSON
Name:
Address:
Tel. No: Fax
No:
Email: ____________________________________________
OTHER DETAILS ENCLOSURES ATTACHED
PAN** Attested / certified true copy of the following:
Date of Application
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OTHER DETAILS ENCLOSURES ATTACHED
Signature of Authorized Signatory
(may be signed either physically or
digitally)
Copy of the PAN Card or PAN Allotment Letter
FIRC
Copy of FPI registration Certificate / MF registration certificate / SEBI registration certificate for AIFs/VCF/SI-
NBFC/IC/IF/FVCI
Certified copy of the certificate of registration issued by the
RBI as an SI-NBFC / a Scheduled Commercial Bank
Copy of notification as a public financial institution
Copy of the IRDAI registration certificate
Certified true copy of power of attorney
Intimation of being part of the same group
Others, please specify________________
*A physical copy of the Application Form and relevant documents as required to be provided along with the Application Form shall be submitted as soon as
practicable. *Please note that the Applicant should not submit the GIR number or any other identification number instead of the PAN as the application is liable to be
rejected on this ground.
*The application form is liable to be rejected if any information provided is incomplete or inadequate at the discretion of the Company in consultation with the BRLM
**Please note that the Bidder should not mention the GIR number or any other identification number instead of the PAN, unless the Bidder is exempted from
requirement of obtaining a PAN under the Income-tax Act, 1961,as the application is liable to be rejected on this ground
Note 1: Capitalized terms used but not defined herein shall have the same meaning as ascribed to them in the PPD and the Placement Document.
Note 2: The Application Form is liable to be rejected if any information provided is incomplete or inadequate at the discretion of the Company and BRLMs.
The Application Form, the PPD sent to you and the Placement Document which will be sent to you, either in physical form or in electronic form or both, are
specific to you and you may not distribute or forward the same and are subject to the disclaimers and restrictions contained or accompanying these documents.
(Note: The format of the Application Form included herein above is indicative and for the illustrative purposes only and no Bids in this Issue can be made
through the sample Application Form. Our Company, in consultation with the BRLMs, shall identify Eligible QIBs and circulate serially numbered copies of this Preliminary Placement Document and the Application Form, specifically addressed to such Eligible QIBs. Any application to be made in the Issue should
be made only upon receipt of serially numbered copies of this Preliminary Placement Document and the Application Form and not on the basis of the indicative
format above.)
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HINDUSTAN COPPER LIMITED
CIN: L27201WB1967GOI028825
Registered and Corporate Office
Tamra Bhavan, 1, Ashutosh Chowdhury Avenue
Kolkata 700 019
West Bengal, India
Telephone: +91 33 2283 2226
Fax: +91 33 2283 2478
E-mail: singhi_cs@hindustancopper.com
Website: www.hindustancopper.com
DETAILS OF COMPLIANCE OFFICER
C.S. Singhi
ED (Company Secretary)
Tamra Bhavan, 1, Ashutosh Chowdhury Avenue
Kolkata 700 019
West Bengal, India
Tel: +91 33 2283 2676
Fax: +91 33 2283 2478
Email: singhi_cs@hindustancopper.com
BOOK RUNNING LEAD MANAGER
IDBI Capital Markets & Securities Limited SBI Capital Markets Limited
6th Floor, IDBI Tower,
World Trade Centre, Cuffe Parade,
Mumbai 400 005
Maharashtra, India
202, Maker Tower ‘E’
Cuffe Parade
Mumbai – 400 005
Maharashtra, India
LEGAL ADVISOR TO THE ISSUE
J. Sagar Associates
Vakils House
18 Sprott Road
Ballard Estate
Mumbai – 400 001
Tel: +91 22 4341 8600
Fax: +91 22 4341 8617
INTERNATIONAL LEGAL COUNSEL TO THE BOOK RUNNING LEAD MANAGERS WITH RESPECT
TO SELLING AND TRANSFER RESTRICTIONS
Squire Patton Boggs Singapore LLP
1 Marina Boulevard
#21-01 One Marina Boulevard
Singapore 018989
Republic of Singapore
STATUTORY AUDITOR TO OUR COMPANY
Chaturvedi & Co.
Chartered Accountants
2nd Floor Park Centre, 24, Park Street
Kolkata – 700 016
West Bengal, India