CHAPTER 3.

FINANCE DEPARTMENT

3.1 Essar Steel Ltd.

3.1.1 P&L account

Particular Amt.
(Rs. In Lakh)
Revenue
Revenue from operation 1,788,609
Other income 102,047
Total revenue 1,890,656
Expenses
License and spectrum fees 161,632
Employee benefit expenses 1,359,678
Finance cost 199,110
Depreciation and amortisation expense 662,914
Other expenses 1,057,280
Total expenses 3,440,614
Loss before tax (1,549,958)
Tax expense
Current tax -
Loss of the year (1,549,958)
Other comprehensive income
Items that will not be reclassified to the
statement of profit or loss
Remeasurment of post employment benefit (9,217)
obligation(net of tax)
Total other comprehensive income (expense)
for the year, net of taxes
Total comprehensive income (expense)for the (1,559,175)
year
Loss of the year attributable to
Owner of the company (1,549,958)
Non controlling interest -
Other comprehensive income for the year
attributable to
Owner of the company (9,217)
Non controlling interest -
Total comprehensive income/(expenses) for
the year attributable to
Owner of the company (1,559,175)
Non controlling interest -
Loss per equity share (Inr) (31.00)
Basic and diluted (nominal value of shares Inr 10
each)
Table 3.1

3.1.2 Balance sheet

Particular Amt. (Rs.

Lakh)
Assets
Non-Current Assets
Property, plant and equipment 9,364,158
Capital work in progress 566,756
Intangible assets 574,567
Intangible assets under development 1,500
Rights of use assets 375,463
Financial assets
(1) Investments -
(2) Loans 243
(3) Other financial assets 30,793
Deferred tax assets (net) -
Other non current assets 76,641
Total non current assets 10,990,121
Current assets
Inventories 140,813
Financial assets
(1) Investments -
(2) Trade receivables 502,219
(3) Cash and cash equivalents 212,574
(4) Bank balance other than above 24,645
(5) Loans 47
(6) Other financial assets 1,721,398
Current tax assets(net) 44,669
Other current assets 389,944
Assets held for sale 649,372
Total current assets 3,685,681
Total assets 14,675,802
Equity and Liability
Equity
Equity share capital 500,000
Other equity 5,413,982
Total equity 5,913,982
Liabilities
 Non current liabilities
Financial liabilities
(1) Borrowing 2,428,595
(2) Lease liabilities 305,283
(3) Other financial liabilities 258,975
Provisions 87,132
Other non current liabilities 52,596
Total non current liabilities 3,132,581
Current liabilities
Financial liabilities
(1) Borrowing 212,647
(2) Lease liabilities 78,794
(3) Trade payables
- Total outstanding dues of micro 110,190
enterprises and small enterprises
- Total outstanding dues of creditors other 1,357,261
than micro enterprises and small
enterprises
(4) Other financial liabilities 2,780,830
Other current liabilities 1,059,714
Provision 29,803
Total current liabilities 5,629,239
Total liabilities 8,761,820
Total equity and liabilities 14,675,802
Table 3.2

3.1.3 Ratio
1) Current Ratio:
Formula: Current Ratio = Current Assets/ Current Liabilities

Particular Amount
Current Assets 3,685,961.00
Current Liabilities 5,629,235.00
Current Ratio 0.6548
 2) Liquid Ratio:
Formula: Liquid Ratio = Current Assets – Inventories / Current Liabilities

Particular Amount
Current Assets 3,685,961.00
Inventories 59,503.00
Current Liabilities 5,629,235.00
Liquid Ratio 0.6442

3) Fixed Assets Turnover Ratio:

Formula: Fixed Assets Turnover Ratio = Total Revenue / Total Fixed Assets

Particular Amount
Total Revenue 1,890,656.00
Total Fixed Assets 9,364,158.00
Fixed Assets Turnover Ratio 0.2019

4) Debt Ratio:

Formula: Debt Ratio = Total Liabilities / Total Assets

Particular Amount
Total Liabilities 8,761,816.00
Total Assets 14,676,081.00
Debt Ratio 0.5970

5) Net Profit Ratio:

Formula: Net Profit Ratio = Net Profit / Net Sales

Particular Amount
Net Profit -1,549,952.00
Net Sale 1,890,656.00
Net Profit Ratio -0.8198
 6) Interest Coverage Ratio:

Formula: Interest Coverage Ratio = Operating Income / Interest Expenses

Particular Amount
Operating Income -1,549,952.00
Interest Expenses -196,882.00
Interest Coverage Ratio 7.8725

7) Net Working Capital:

Formula: Net Working Capital = Current Assets – Current Liabilities

Particular Amount

Current Assets 3,685,961.00

Current Liabilities 5,629,235.00
Net Working Capital -1943274.00

8) Fixed Assets to Net Worth:

Formula: Fixed Assets to Net Worth = Fixed Assets / Net Worth

Particular Amount
Fixed Assets 9,364,158.00
Net Worth -1,549,952.00
Fixed Assets to Net Worth -6.0416

9) Return on Equity:

Formula: Return on Equity = Net Income / Shareholder's Equity

Particular Amount
 Net Income -1,549,952.00
Shareholder's Equity 5,914,265.00
Return on Equity -0.2621

3.1.4 Financial statement

During the year under review , the total income of the Company was `0.32 lakhs as
against `100.54 lakhs in the previous financial year. The Essar Steel Company has
incurred net loss of `18.61 lakhs as against net profit of `71.56 lakhs in the previous
financial year. The Company’s performance and outlook for the year under review has
been discussed in detail in Management Discussion and Analysis which forms a part of
this Report.

Amount transferred to reserves

The Directors do not propose to transfer any amount to reserves for the financial year
ended March 31,2020.

Share capital

There was no change in the capital structure of the Company during the financial year
under review. The paid up share capital as on March 31, 2020 was `14,28,77,540/-
comprising of 1,42,87,754 Equity Shares of `10/- each.

Dividend

The Directors do not recommend any dividend for the financial year ended March 31,
2020.

Investor education and protection fund

In terms of Section 124(5) of Companies Act, 2013, the Company has transferred
unpaid/unclaimed dividend amount aggregating to `9,85,302/- pertaining to the financial
year 2010-11 to the Investor Education and Protection Fund (IEPF) during the financial
year under review. Pursuant to Section 124(6) of Companies Act, 2013 read with Investor
Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund)
Rules, 2016, the Company has transferred 5,25,016 shares in respect of which the
dividend mentioned aforesaid has remained unpaid or unclaimed for a period of seven
consecutive years to IEPF demit account during the financial year under review.The
members, whose unclaimed dividends/shares have been transferred to IEPF , may claim
the same by making an application to the IEPF Authority, in Form No. IEPF-5 available
on www.iepf.gov.in.

3.1.5 CSR and the expenses :

CSR Activities Expenses:

Essar  Foundation bagged an award for Best Corporate Social Responsibility Practices at
the Global CSR Excellence & Leadership Awards. The Awards were part of the 4th
World CSR Congress which was held in Mumbai on February 17, 2015. Essar Steel
Vizag also won an award under the Women Empowerment category for Sahaj, the low-
cost sanitary napkin initiative. Essar supports the production of the sanitary napkins by
women of a local self-help group in Dantewada district in Chhattisgarh state. 

The World CSR Congress shares best practices in CSR and sustainability, and awards
organizations and individuals that are making a difference in society. It is guided by
sustainability executives, experts and media from around the globe.
At another event organized earlier on February 14, Mr Deepak Arora, CEO, Essar
Foundation, won the award for ‘Leadership Excellence in Corporate Social
Responsibility’. Mr Arora bagged the honour at the Greatest Corporate Leaders of India.

3.1.6 A listed company. If yes, then where and since how long?
 Yes, Essar steel is listed company in The Stock Exchange, Mumbai , National Stock
Exchange of India Ltd

Year Ending Month May

AGM Date (Month) Sep

Book Closure Date (Month) Sep

Face Value Of Equity Shares 10

Market Lot Of Equity Shares 1

BSE Code 500627

NSE Code 0

BSE Group B1