MIRA INFORM REPORT

Report Date :

03.10.2011

IDENTIFICATION DETAILS

Name :	JSW Steel Limited (w.e.f. 16.06.2005)
Formerly Known As :	JINDAL VIJAYNAGAR STEEL LIMITED
Registered Office :	Jindal Mansion, 5A, Dr. G. Deshmukh Marg, Mumbai – 400 026, Maharashtra
Country :	India
Financials (as on) :	31.03.2011
Date of Incorporation :	15.03.1994
Com. Reg. No.:	11-152925
Capital Investment / Paid-up Capital :	Rs.5631.800 millions
CIN No.: [Company Identification No.]	L27102MH1994PLC152925
TAN No.: [Tax Deduction & Collection Account No.]	MUMJ05285A / PNEJ05353F
PAN No.: [Permanent Account No.]	AAACJ4323N / AACT4323N
Legal Form :	A Public Limited Liability Company. The Company's Shares are Listed on the Stock Exchanges.
Line of Business :	Manufacturer, Exporter and Importer of Steel Plates.
No. of Employees :	8925 (Approximately)

RATING & COMMENTS

MIRA’s Rating :

A (66)

RATING		STATUS	PROPOSED CREDIT LINE
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large

Maximum Credit Limit :	USD 690000000
Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear
Comments :	Subject is a well established and a reputed company having fine track. Financial position of the company appears to be sound. Fundamentals are strong and healthy. Trade relations are reported as fair. Business is active. Payments are reported to be regular and as per commitments. The company can be considered normal for business dealings at usual trade terms and conditions.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

INFORMATION PARTED BY

Name :	Mr. Ketan Patel
Designation :	Vice President in Finance
Contact No.:	91-22-43437262
Date :	29.09.2011

LOCATIONS

Registered Office / Regional Office:	Jindal Mansion, 5A, Dr. G. Deshmukh Marg, Mumbai – 400 026, Maharashtra, India
Tel. No.:	91-22-23513000 / 23520980 / 43437199 / 43437262
Fax No.:	91-22-23526400 / 23522600
E-Mail :	jvsl.blr@sm3.sprintrpg.ems.vsnl.net.in admin.vijayanagar@jvsl.com lancy.varghese@jsw.in jvsl@jvsl.com ketan.patel@jsw.in
Website :	http://www.jsw.in
Corporate Office 1:	JSW Foundation: Victoria House, 2^nd Floor, Pandurang Budhkar Marg, Lower Parel, Mumbai – 400013, Maharashtra, India
Tel No. :	91-22-24927000/ 43437800
Fax No. :	91-22-24917960
Email :	natalie.barretto@jsw.in
Corporate Office 2:	The Enclave, Maratha Udhog Bhavan, New Prabhadevi Road, Prabhadevi, Mumbai – 400025, Maharashtra, India
Tel No. :	91-22-6783 8000
Fax No. :	91-22-2432 0740
Factory 1 :	Vijayanagar Works P.O. Vidyanagar, Toranagallu Village, Sandur Taluk, Bellary District, Karnataka - 583 275, India
Tel. No.:	91-8395-250120 to 30
Fax No.:	91-8395-250138 / 250665
Factory 2 :	Vasind Works Shahapur Taluk, Thane District, Maharashtra - 421 604, India
Tel. No.:	91-2527-220022 to 025
Fax No.:	91-2527-220020 / 84 / 92
Factory 3 :	Tarapur Works MIDC Boisar, Thane District, Maharashtra – 401 506, India
Tel. No.:	91-2525-270147 / 270149
Fax No.:	91-2525-270148
Factory 4 :	Salem Works Pottaneri, M. Kalipatti Village, Mecheri Post, Mettur Taluk, Salem District, Tamilnadu - 636 453, India
Tel. No.:	91-4298-278400 to 404
Fax No.:	91-4298-278618
Factory 5 :	Vijayanager Minerals Private Limited P.O. Vidyhanager, Toranagallu, Distrcit Ballary- 583275, Karnataka, India
Tel. No.:	91-8395-350120
Fax No.:	91-8395-240365
Factory 4 :	JSW Bengal Steel Limited Tower A 3^rd Floor, DLF IT Park, 8 Major Arterial Road, New Town Kolkata-700156, West Bengal, India
Tel. No.:	91-33-400002020
Fax No.:	91-33-40002021
Factory 5 :	Jindal Praxair Oxygen Company Private Limited Post Box No. 16, Vidyangar, District Ballary – 583275, Karnataka, India
Tel. No.:	91-8395-250856 to 858
Fax No.:	91-8395-250781
Factory 6 :	South West Port Limited 1^st Floor, Port Users Complex, Mormugao Harbour, Goa-403803, India
Tel. No.:	91-832-2523000
Fax No.:	91-832-2523006
Factory 7 :	JSW Aluminium Limited Opposited NSTL, 58-17-1/1, Sanjevaya Nagar, Near NAD Kotha Road Junction, Visakahpatnam-530009, India
Factory 8 :	JSW Energy – Ratnagiri Limited Ambassador Plaza, 1^st Floor, Malnaka, Ratnagiri-415612, Maharashtra, India
Factory 9:	Raj West Power 308-311, Gitanjali Towers, Bomba Walo Ka Baug, Ajmer Road, Jaipur-302006, Rajasthan, India
Factory 10 :	JSW Cement Limited R O Vidyanagar, Torangallu District Ballary-583275, Karnataka, India
Tel. No.:	91-8395-250120 to 30
Fax No.:	91-8395-250138/ 250665
Branches :	Located at :- · Karnataka · Tamilnadu · Andhra Pradesh · Coimbatore · New Delhi · Madhya Pradesh
Additional Main Office :	Located at: · Mumbai · Bangalore · Rajasthan
Overseas Office :	JSW Steel (USA) Inc. 5200 East Mc Kinney Road, Baytown , TEXAS 77523, U.S.A. Office : 1 - 281 - 383 - 5100 Fax : 1 - 281 - 383 - 1803 Website : www.jswsteelusa.com JSW Steel Service Centre (UK) Limited Lake Road , Leeway Industrial Estate, Newport, NP19 4WN, United Kingdom Tel: 44 - 1633290260 Fax: 44 - 1633290911 Website: www.jswsteel.co.uk

DIRECTORS

As on 31.03.2011

Name :	Mrs. Savitri Devi Jindal
Designation :	Chairperson
Name :	Mr. Sajjan Jindal
Designation :	Vice Chairman and Managing Director
Name :	Mr. Seshagiri Rao M.V.S.
Designation :	Joint Managing Director and Group Chief Finance Officer
Date of Birth/Age :	15.01.1958
Qualification :	AICWA, LCS, CAIIB, Diploma in Business Finance.
Expertise in specific functional area :	Mr. Seshagiri Rao MVS joined the Company in 1997 as Chief Financial Officer and has played an active role in the growth strategies of the Company. Prior to joining the Company he has worked with various reputed organisations like VST industries, Andhra Bank, ESSAR Steel Limited and Nicholas Piramal India Limited in various Capacities. He possesses rich experience spanning over three decades in the areas of Corporate Finance and Banking. In his present capacity as Joint Managing Director and Group CFO. Mr. Rao is responsible for the overall Operations of the Company, Strategic initiatives related to business development, expansion of existing businesses, joint ventures, mergers and acquisitions and cost management.
Date of Appointment :	06.04.1999
Other Directorship :	lspat Industries Limited
Name :	Dr. Vinod Nowal
Designation :	Director and Chief Finance Officer
Name :	Mr. Jayant Acharya
Designation :	Director (Commercial and Marketing)
Date of Birth/Age :	25.01.1963
Qualification :	BE (Chemical), M. Sc (Physics), MBA (Marketing).
Expertise in specific functional area :	Mr. Jayant Acharya is a Chemical Engineer with a Masters in Physics from BITS, Pilani in the year 1986, He has done his MBA in Marketing from the lndore University. Mr. Acharya has 24 years of experience in the steel induslry spanning the entire range of flat and long steel products. He has worked in various capacities and locations in India. His extensive experience includes startup operations, development and execution of strategies for penetrating new markets and customers, creation of strong brand equity for the Company in the domestic and international markets and introduction of innovative marketing concepts.
Date of Appointment :	07.05.2009
Other Directorship :	· JSW Steel Processing Centres Limited · JSW Building Systems Limited · JSW Severfield Structures Limited · JSW Structural Metal Decking Limited
Name :	Mr. M. Maheshwar Rao, IAS
Designation :	Nominee Director of KSIIDC
Name :	Mr. Yasushi Kurokawa
Designation :	Nominee Director of JFE Steel Corporation, Japan
Name :	Mrs. Zarin Dariwala
Designation :	Nominee Director of ICICI Bank Limited
Name :	Dr. S K Gupta
Designation :	Director
Name :	Mr. Anthony Paul Pedder
Designation :	Director
Name :	Dr. Vijay Kelkar
Designation :	Director
Name :	Mr. Uday M Chitale
Designation :	Director
Name :	Mr. Sudipto Sarkar
Designation :	Director
Date of Birth/Age :	21.03.1946
Qualification :	B.Sc. (Maths - Hons), BA (Law Tripos), LLM (International Law), MA (Law) Barrister, Gray’s Inn. London.
Expertise in specific functional area :	He is presently practicing as a senior advocate in the Calcutta High Court and has wide experience in Commercial Law particularly Company Law, lntellectul Property and Shipping Laws. He is a B.Sc. (Mathematics) from the Presidency College, Kolkata, BA (Law Tripos) LL.M. (International Law), M.A. (Law), University of Cambridge and Barrister, Gray’s Inn, London. He also has several publications to his credit and is the collaborating editor of the Ramaiya’s Guide to the Companies Act and contributor to several volumes of International Law Reports (Cambridge).
Date of Appointment :	09.05.2005
Other Directorship :	· Vesuvius India Limited · Bombay Stock Exchange Limited · EIH Associated Hotels Limited · Descon Limited · B and A Limited · Eveready Industries India Limited · Island Hotel Maharaj Limited · B and A Packaging India Limited
Name :	Mr. Kannan Vijayaraghavan
Designation :	Director
Date of Birth/Age :	04.05.1959
Qualification :	Fellow Member of the Institute of Chartered Accountants of India, Certified Management Consultant and Fellow of the Institute of Management Consultants.
Expertise in specific functional area :	Mr. Kannan Vijayaraghavan, is a Fellow Member of the Institute of Chartered Accountants of India, a Certified Management Consultant and a Fellow of the Institute of Management Consultants. He is the Director and founder of Sathguru Management Consultants Private Limited, Hyderabad, a large consultancy and policy advisory firm founded in the year 1985. He is also Partner of DFK International, a worldwide firm of accountants and business advisors, a Visiting Fellow and Faculty, Executive Education, Cornell University, Ithaca. NY and a Regional Coordinator for Comet University Research Programs in South Asian! South East Asian Region. Over the last twenty six years, he has handled over 300 assignments in the area of Strategic Planning, Mergers and Acquisitions and Organisational Growth in Emerging Market Related Environment. He also has wide exposure to overseas environment with Consulting exposure to large Multinational and Emerging National companies. Global companies consulted include 20 Fortune 500 companies, about 100 Mid Cap Enterprises and NASDAQ listed companies.
Date of Appointment :	16.06.2008

KEY EXECUTIVES

Name :	Mr. Lancy Varghese
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 30.06.2011

Category of Shareholders	No. of Shares	% of total No. of Shares
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	3,969,585	1.80
Central Government / State Government(s)	907,952	0.41
Bodies Corporate	73,560,512	33.43
Sub Total	78,438,049	35.65
(2) Foreign
Bodies Corporate	5,704,612	2.59
Sub Total	5,704,612	2.59
Total shareholding of Promoter and Promoter Group (A)	84,142,661	38.24
(B) Public Shareholding
(1) Institutions
Mutual Funds / UTI	1,276,973	0.58
Financial Institutions / Banks	9,490,567	4.31
Central Government / State Government(s)	1,237,500	0.56
Foreign Institutional Investors	53,870,858	24.48
Sub Total	65,875,898	29.94
(2) Non-Institutions
Bodies Corporate	7,538,625	3.43
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 million	14,104,357	6.41
Individual shareholders holding nominal share capital in excess of Rs.0.100 million	2,097,864	0.95
Any Others (Specify)	46,271,981	21.03
Trusts	1,927,556	0.88
Foreign Corporate Bodies	41,201,389	18.73
Overseas Corporate Bodies	40,712	0.02
Non Resident Indians	3,102,324	1.41
Sub Total	70,012,827	31.82
Total Public shareholding (B)	135,888,725	61.76
Total (A)+(B)	220,031,386	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	-	-
(1) Promoter and Promoter Group	-	-
(2) Public	3,085,814	-
Sub Total	3,085,814	-
Total (A)+(B)+(C)	223,117,200	-

Shareholding belonging to the category "Promoter and Promoter Group"

Sl. No.	Name of the Shareholder	Number	As a % of
1	Jindal South West Holdings Limited	17,284,923	7.75
2	Jsw Energy Investments Private Limited	13,764,364	6.17
3	Jsw Power Trading Company Limited	7,003,835	3.14
4	Jsw Investments Private Limited	6,559,365	2.94
5	Nalwa Sons Investments Limited	4,548,537	2.04
6	Sun Investments Private Limited	3,332,042	1.49
7	Jindal Holdings Limited	3,077,704	1.38
8	Gagan Trading Company Limited	2,239,085	1.00
9	Beaufield Holdings Limited	1,922,797	0.86
10	Vrindavan Services Private Limited	1,869,581	0.84
11	Jindal Steel And Alloys Limited	1,656,758	0.74
12	Sajjan Jindal	1,654,336	0.74
13	Jindal Equipment Leasing and Consultancy Services Limited	1,594,571	0.71
14	Hexa Securities and Finance Co Limited	1,455,098	0.65
15	Jsw Investments Private Limited	1,298,800	0.58
16	Nalwa Investments Limited	1,231,475	0.55
17	Reynold Traders Private Limited	1,222,006	0.55
18	Mansarover Investments Limited	1,180,122	0.53
19	Stainless Investments Limited	946,228	0.42
20	Colorado Trading Company Limited	908,318	0.41
21	Karnataka State Industrial Investment And Developm	907,952	0.41
22	Abhinandan Investments Limited	692,113	0.31
23	Sajjan Jindal	674,744	0.30
24	Ever Plus Securities and Finance Limited	526,785	0.24
25	Heston Securities Limited	425,239	0.19
26	Jargo Investments Limited	425,000	0.19
27	Sarmento Holdings Limited	421,957	0.19
28	Mendeza Holdings Limited	421,809	0.19
29	Nacho Investments Limited	420,738	0.19
30	Templar Investments Limited	420,652	0.19
31	Pentel Holding Limited	416,657	0.19
32	Estrela Investment Company Limited	416,007	0.19
33	Vavasa Investments Limited	413,756	0.19
34	Hexa Securities And Finance Co Limited	376,859	0.17
35	Tarini Jindal	350,000	0.16
36	Tanvi Jindal	350,000	0.16
37	Parth Jindal	350,000	0.16
38	Hexa Securities And Finance Co Limited	296,958	0.13
39	Sangita Jindal	204,813	0.09
40	Renuka Financial Services Limited	197,807	0.09
41	Manjula Finance Limited	195,964	0.09
42	Tarini Jindal	141,389	0.06
43	Tanvi Jindal	138,363	0.06
44	Goswamis Credits and Investment Limited	61,888	0.03
45	Urmila Bhuwalka	25,227	0.01
46	Ratan Jindal	14,857	0.01
47	Meredith Traders Private Limited	12,305	0.01
48	Prithvi Raj Jindal	7,379	0.00
49	Wachovia Investments Limited	6,196	0.00
50	Rishikesh Finlease Investments Private Limited	6,000	0.00
51	Sminu Jindal	5,589	0.00
52	Deepika Jindal	5,462	0.00
53	Urvi Jindal	5,082	0.00
54	Abhyuday Jindal	5,078	0.00
55	Tripti Jindal	5,034	0.00
56	Savitri Devi Jindal	5,026	0.00
57	Ratan Jindal	3,818	0.00
58	P. R. Jindal (H.U.F.)	3,726	0.00
59	Baltimore Trading Private Limited	3,666	0.00
60	Kamshet Investments Private Limited	4,177	0.00
61	Aras Overseas Limited	2,890	0.00
62	Musuko Trading Private Limited	2,714	0.00
63	Girish Jhunjhnuwala	2,187	0.00
64	Parth Jindal	2,000	0.00
65	Savitri Devi Jindal	1,848	0.00
66	Girish Jhunjhnuwala	1,813	0.00
67	Naveen Jindal	1,633	0.00
68	Aiyush Bhuwalka	1,400	0.00
69	Jindal Saw Limited	1,362	0.00
70	Arti Jindal	1,092	0.00
71	Naveen Jindal	1,071	0.00
72	Ratan Jindal	1,071	0.00
73	Prithvi Raj Jindal	1,071	0.00
74	M/S Naveen Jindal and Sons Huf	776	0.00
75	M/S S K Jindal and Sons Huf	776	0.00
76	M/S Prithvi Raj Jindal Huf	776	0.00
77	Ratan Jindal	700	0.00
78	Savitri Devi Jindal	600	0.00
79	Ratan Jindal	400	0.00
80	Saroj Bhartia	139	0.00
81	Prithvi Raj Jindal	53	0.00
82	Nirmala Goel	51	0.00
83	Nirmala Goel	21	0.00
84	Navin Kumar Jindal	8	0.00
85	Naveen Kumar Jindal	8	0.00
86	R K Jindal Karta R K Jindal Huf	8	0.00
87	Savitri Devi Jindal	8	0.00
88	Savitri Devi Jindal	8	0.00
89	Savitri Devi Jindal	8	0.00
90	Savitri Devi Jindal	8	0.00
91	Ratan Jindal	8	0.00
92	Ratan Jindal	8	0.00
93	Ratan Jindal	8	0.00
94	Savitri Devi Jindal	8	0.00
95	Savitri Devi Jindal	8	0.00
96	Jindal Equipment Leasing and Cons Serv Limited	8	0.00
97	Sh P R Jindal	8	0.00
98	Savitri Devi Jindal	8	0.00
99	Ratan Jindal	8	0.00
100	Arti Jindal	8	0.00
101	Tripti Jindal	8	0.00
102	Tripti Jindal	8	0.00
103	Tripti Jindal	8	0.00
104	Arti Jindal	8	0.00
105	Tripati Jindal	8	0.00
106	Jindal Coated Steel Private Limited	4	0.00
107	Naman Enterprises Private Limited	4	0.00
108	Deepikal Jindal	4	0.00
109	Madhur Goel	4	0.00
110	Nirmala Goel	4	0.00
111	Nirmala Goel	4	0.00
	Total	84,142,661	37.71

Shareholding belonging to the category "Public" and holding more than 1% of the Total No. of Shares

Sl. No.	Name of the Shareholder	No. of Shares	Shares as % of Total No. of Shares
1	Jfe Steel Corporation	32,982,704	14.78
2	Janus Contrarian Fund	5,109,636	2.29
3	Duferco Coke Investments Limited	5,035,241	2.26
4	Mavi Investment Fund Limited	4,417,000	1.98
5	Life Insurance Corporation Of India	4,175,363	1.87
6	Lotus Global Investments Limited	4,170,965	1.87
7	The Indiaman Fund (Mauritius) Limited.	3,935,000	1.76
8	Somerset Emerging Opportunities Fund	3,916,000	1.76
9	Minerals Euroasia Limited	3,183,444	1.43
10	Citibank N.A. New York, Nyadr Department	3,085,814	1.38
	Total	70,011,167	31.38

Details of Locked-in Shares

Sl. No.	Name of the Shareholder	No. of Shares	Locked-in Shares as % of Total No. of Shares
1	Jfe Steel Corporation	32,982,704	14.78
	Total	32,982,704	14.78

Details of Depository Receipts (DRs)

Sl. No.	Type of Outstanding DR (ADRs, GDRs, SDRs, etc.)	No. of Outstanding DRs	No. of Shares Underlying Outstanding DRs	Shares Underlying Outstanding DRs as % of Total No. of Shares
1	GDR	3,085,814	3,085,814	1.38
	Total	3,085,814	3,085,814	1.38

BUSINESS DETAILS

Line of Business :

Manufacturer, Exporter and Importer of Steel Plates.

Products :

Item Code No.(ITC Code)	Product Description
72.08	Hot Rolled Steel Strips/ Sheets/ Plates
72.09	MS Cold Rolled Coils/ Sheet
72.10	MS Galvanized Plain/ Corrugated/Colour coated Coils/ Sheet
720690	Steel Billet
721490	Bar And Rods

Exports :

Products :

Steel

Countries :

Dubai

Imports :

Products :

· Raw Material

· Finished Goods

Countries :

· China

· Japan

Terms :

Selling :

Cash and Credit

Purchasing :

Cash and Credit

PRODUCTION STATUS (AS ON 31.03.2011)

Particulars	Unit	Installed Capacity	Actual Production
Ms Slabs	Tonnes	6800000	5042838
Hot Rolled Coils/Steel Plated/Sheets	Tonnes	6700000	4787770
Hot Rolled Steel Plates	Tonnes	320000	151739
Cold Rolled Coils / Sheet	Tonnes	1825000	1669884
Galvanised/Galvalum Coils / Sheet	Tonnes	900000	908498
Colour Coating Coils/Sheets	Tonnes	232000	159583
Steel Billets And Bloom	Tonnes	2500000	1384107
Long Rolled Products	Tonnes	2200000	1134004

NOTE:

1. Licensed capacity is not applicable in view of the Company’s products having been delicensed as per the licensing policy of the Government of India.

2. Installed capacity is as certified by the management and accepted by auditors, being a technical matter.

3. Production of Galvanized/ Galvalume Coils/ Sheets includes 85381 tonnes from third parties on a job work basis.

GENERAL INFORMATION

Customers :

· Retailers

· End Users

· OEM’s

No. of Employees :

8925 (Approximately)

Bankers :

· Allahabad Bank

· Bank of Baroda

· Bank of India

· ICICI Bank Limited

· IDBI Bank Limited

· Indian Bank

· Indian Overseas Bank

· Punjab National Bank

· State Bank of India

· State Bank of Indore

· State Bank of Mysore

· State Bank of Patiala

· Union Bank of India

· Vijaya Bank

Facilities :

Secured Loans	31.03.2011 Rs. in Millions	31.03.2010 Rs. In Millions
Debentures
7.10% Non Convertible Debentures of Rs.1.000 Million each	5000.000	0.000
8% Non Convertible Debentures of Rs.1.000 Million each	0.000	2500.000
8.10% Non Convertible Debentures of Rs.1.000 Million each	0.000	2500.000
10.10% Non Convertible Debentures of Rs.1.000 Million each	10000.000	10000.000
10.20% Non Convertible Debentures of Rs.1.000 Million each	409.500	487.500
10.20% Non Convertible Debentures of Rs.1.000 Million each	314.100	397.800
10.25% Non Convertible Debentures of Rs.1.000 Million each	5000.0000	5000.000
10.60% Non Convertible Debentures of Rs.1.000 Million each	3500.00	3500.000
Total	24223.600	24385.300
From Banks
Rupee Term Loans	30419.200	43959.500
Foreign Currency Term Loans	18257.800	19992.600
Total	48677.000	63952.100
From Financial Institutions
Rupee Term Loans	515.200	954.900
Working Capital Loans from Banks	3342.400	582.800
Total	76758.200	89875.100

NOTES:

1. Terms of Redemption

· The 7.10% Redeemable Secured NCDs of Rs.1.000 million each aggregating to Rs.5000.000 Millions are redeemable as under:

- Rs.2500.000 millions on 15.04.2011.

- Rs.2500.000 millions on 18.04.2011.

· The 10.10% Redeemable Secured NCDs of Rs.1.000 million each aggregating to Rs.10000.000 Millions are partly redeemable in 16 quarterly installments of Rs.312.500 millions each from 041.02.2014 to 04.11.2017 and partly redeemable in 16 quarterly installments of Rs.312.500 millions each from 15.06.2014 to 15.03.2018.

· The 10.20% Redeemable Secured NCDs of Rs.1.000 million each aggregating Rs.409.500 millions are redeemable in 21 quarterly installments of Rs.19.500 Millions each from 15.04.2011 to 15.04.2016.

· The 10.20% Redeemable Secured NCDs of Rs.1.000 million each aggregating Rs.314.100 millions are redeemable in 15 quarterly installments of Rs.20.900 Millions each from 01.07.2011 to 01.01.2015.

· The 10.25% Redeemable Secured NCDs of Rs.1.000 million each aggregating Rs.5000.000 millions are redeemable in 3 equal annual installments of Rs.1666.700 Millions each from 17.02.2016 to 17.02.2018.

· The 10.60% Redeemable Secured NCDs of Rs.1.000 million each aggregating Rs.3500.000 millions are partly redeemable in 8 half yearly installments of Rs.218.750 Millions each from 02.01.2016 to 02.07.2019 and partly redeemable in 8 half yearly installments of Rs.218.750 Millions each from 02.08.2016 to 02.02.2020.

2. Details of Security

· The 7.10% NCDs aggregating Rs.5000.000 millions are secured by pari passu first charge by way of legal mortgage on land situated in the State of Gujarat.

· The 10.10% NCDs aggregating Rs.10000.000 millions are secured/ to be secured by:

- pari passu first charge by way of legal mortgage on all immovable properties both present and future located at Tarapur Works and Vasind Works in the State of Maharashtra.

- pari passu first charge on all immovable properties and movable assets both present and future located at Salem Works in the State of Tamil Nadu.

· The 10.20% NCDs aggregating Rs.409.500 millions are secured by:

- pari passu first charge by way of legal mortgage on a flat situated at Mumbai, in the State of Maharashtra.

- pari passu first charge by way of equitable mortgage of the Company’s immovable properties relating to the 100MW and 130MW Power Plants at Toranagallu village in the State of Karnataka.

· The 10.20% NCDs aggregating Rs.314.100 millions are secured by:

- First charge on land situated in the State of Gujarat.

- Second charge on Fixed Assets situated at Salem Works in the state of Tamil Nadu.

· The 10.25% NCDs aggregating Rs.5000.000 millions are secured by way of mortgage in respect of all immovable and movable properties both present and future located at Tarapur Works and Vasind works in the State of Maharashtra.

· The 10.60% NCDs aggregating Rs.3500.000 millions are secured/to be secured by:

- pari passu first charge by way of legal mortgage on land situated in the State of Gujarat.

- pari passu first charge by way of equitable mortgage on fixed assets of the new 5 mtpa Hot Strip Mill at Toranagallu village in the State of Karnataka.

· The Rupee Term Loans from Banks aggregating Rs.753.800 millions, Rupee Term Loan from financial Institution aggregating Rs.38.200 millions and Foreign Currency Term Loans from Banks aggregating Rs.2366.500 millions are secured by:

- pari passu first charge by way of equitable mortgage in respect of immovable properties of Upstream Division situated at Vaddu, Kurekuppe and Toranagallu villages in the State of Karnataka and

- pari passu first charge by way of hypothecation of movable properties of Upstream Division both present and future excluding inventories and book debts.

· The Rupee Term Loans from banks aggregating Rs.200.900 millions and Foreign Currency Term Loans from banks aggregating Rs.1857.700 millions are secured by a first charge supported by an equitable/registered Mortgage of movable and immovable properties and assets situated at Salem Works in the state of Tamil Nadu and a second pan passu charge on the current assets at Salem Works.

· Rupee Term Loans from Banks/Foreign Currency Term Loan from Bank are secured/to be secured as under:

- Rupee Term Loans aggregating Rs.2717.500 millions and Foreign Currency Term Loans aggregating Rs.2902.300 millions by exclusive first charge by way of equitable mortgage in respect of all movable and immovable properties of Cold Rolling Mill Complex at Toranagallu village in the State of Karnataka.

- Rupee Term Loans aggregating Rs.297.000 millions and Foreign Currency Term Loans aggregating Rs.3195.000 millions by exclusive first charge by way of equitable mortgage in respect of all movable and immovable properties both present and future of 2.8 mtpa expansion project at Toranagallu village, in the State of Karnataka.

- Foreign Currency Term Loans aggregating Rs.7813.800 millions by exclusive first charge by way of equitable mortgage in respect of all movable and immovable properties of Hot Strips Mill at Toranagallu village in the State of Karnataka.

- Rupee Term Loans aggregating Rs.233.500 millions by pari passu first charge by way of legal mortgage in respect of all movable and immovable properties both present and future, first charge/Assignment of all the assets and first charge on all the Bank Accounts of 3.2 mtpa expansion project at Toranagallu village in the State of Karnataka.

- Rupee Term Loan aggregating Rs.150.000 millions by exclusive first mortgage and charge on all movable and immovable properties both present and future, and first charge on the Bank Accounts of the 300 MW Power Plant - CPP IV at Toranagallu village in the State of Karnataka.

- Rupee Term Loan aggregating Rs.2950.000 millions by first mortgage and charge of all immovable properties both present and future, and a first charge by way of hypothecation of all movable properties both present and future of the Beneficiation Plant (6 x 500 tph) and Pellet Plant (4.2 mtpa) at Toranagallu village in the State of Karnataka.

· Foreign Currency Term Loans from Bank aggregating Rs.122.500 millions are secured by way of equitable mortgage in respect of all immovable and movable properties both present and future located at Tarapur Works and Vasind Works, in the State of Maharashtra.

· Rupee Term Loan from Financial Institution aggregating Rs.477.000 millions are secured by exclusive first charge by way of hypothecation of Bombardier Challenger 300 aircraft.

· Working capital loans aggregating Rs.3342.400 millions by:

- pari passu first charge by way of hypothecation of Stocks of Raw Materials, Finished Goods, Work-in-Progress, Consumable Stores and Spare and Book Debts / Receivables of the Company, both present and future.

- pari passu second charge on movable properties and immovable properties forming part of the Fixed/Blocked assets of the Company, both present and future except such properties as may be specifically excluded.

· Certain Working capital loans are collaterally secured by pari passu second charge on the immovable property of a third party.

3. Out of the above, Foreign Currency Term Loan from Banks aggregating Rs.122.500 millions along with interest there on are personally guaranteed by the Vice Chairman and Managing Director of the Company.

Unsecured Loans	31.03.2011 (Rs. in Millions)	31.03.2010 (Rs. In Millions)
2,744 Zero Coupon Foreign Currency Convertible Bonds (FCCB) of USD 1,00,000 each	12252.000	12386.400
Long Term Advances From a Customer (Repayable within a year Rs.693.600 Millions)	5595.300	6288.900
Term Loan from Banks (Repayable within a year Nil	12000.000	5100.000
Foreign Currency Loans from Banks (Repayable within a year Rs.8442.600 millions)	11791.400	1084.100
Sales Tax Deferral	1116.500	1116.500
Total	42755.200	25975.900

NOTE:

The FCCB’s are convertible into Equity Shares at the option of the bondholders at any time on or after 7 August, 2007 and prior to the close of business on 21 June, 2012 at Rs.40.28 = 1 US $.

Banking Relations :	--
Auditors :
Name :	Statutory Auditors Deloitte Haskins and Sells Chartered Accountants
Joint Ventures :	· Vijayanagar Minerals Private Limited · Rohne Coal Company Private Limited · Gourangdih Coal Limited · Toshiba JSW Turbine and Generator Private Limited · MJSJ Coal Limited · JSW Severfield Structures Limited Address : 302, Naman Centre, Plot No. C-31, G-Block, Bandra Kurla Complex, Bharat Nagar, Mumbai, Maharashtra, India
Subsidiaries:	· JSW Steel (UK) Limited · JSW Steel Service Centre (UK) Limited · Argent Independent Steel (Holdings) Limited · JSW Natural Resources Limited · JSW Natural Resources Mozambique Limitada · JSW Steel (Netherlands) B.V. · JSW Steel Holding (USA) Inc. · JSW Steel (USA) Inc. · Periama Holdings LLC (West Virginia LLC) (w.e.f. 03.05.2010) · Planck Holdings LLC (w.e.f. 03.05.2010) · Rolling S Augering LLC (w.e.f. 03.05.2010) · Carreta Minerals LLC (w.e.f. 03.05.2010) · Periama Handling LLC (w.e.f. 03.05.2010) · Lower Hutchinson Minerals LLC (w.e.f. 03.05.2010) · Purest Energy LLC (w.e.f. 03.05.2010) · Meadow Creek Minerals LLC (w.e.f. 03.05.2010) · Keenan Minerals LLC (w.e.f. 03.05.2010) · Hutchinson Minerals LLC (w.e.f. 03.05.2010) · RC Minerals LLC (w.e.f. 03.05.2010) · Peace Leasing LLC (w.e.f. 03.05.2010) · Prime Coal LLC · JSW Panama Holdings Corporation · Inversiones Eurosh Limitada · Santa Fe Mining · Santa Fe Puerto S.A. · JSW Steel Processing Centres Limited · JSW Jharkhand Steel Limited · JSW Bengal Steel Limited · Barbil Benefication Company Limited · JSW Building Systems Limited · JSW Natural Resources India Limited · JSW ADMS Carvo Limitada
Associates:	· Jindal Praxair Oxygen Company Private Limited. · JSW Energy (Bengal) Limited · Ispat Industries Limited (w.e.f. 24.01.2011)
Enterprises over which Key Management Personnel and Relatives of such personnel exercise significant influences :	· JSW Energy Limited · JSL Limited · JSW Realty and Infrastructure Private Limited · Jindal Saw Limited · Jindal Steel and Power Limited · Jindal South West Holdings Limited · JSOFT Solutions Limited · Jindal Industries Limited · JSW Energy (Ratnagiri) Limited · JSW Cement Limited · JSW Jaigarh Port Limited · Nalwa Sons and Investments Limited · JSW Investments Private Limited · Reynold Traders Private Limited · Raj West Power Limited · JSW Power Trading Company Limited · JSW Aluminium Limited · P Jindal Foundation · JSW Infrastructure and Logistic Limited · South West Port Limited · JSW Techno Projects Management Limited · Sapphire Technologies Limited

CAPITAL STRUCTURE

As on 31.03.2011

Authorised Capital :

No. of Shares	Type	Value	Amount
2000000000	Equity shares	Rs.10/- each	Rs.20000.000 millions
1000000000	Preference Shares	Rs.10/- each	Rs.10000.000 millions
	Total		Rs.30000.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
223117200	Equity shares	Rs.10/-each	Rs.2231.200 millions
	Add: Equity shares Forfeited		Rs. 610.300 millions
279034907	10% Cumulative Redeemable Preference Shares	Rs.10/-each	Rs.2790.300 millions
	Total		Rs.5631.800 millions

NOTES:

· 7,70,27,049 equity shares are allotted as fully paid-up pursuant to Schemes of Arrangement and/or Amalgamation without payment being received in cash as follows:

a) 4,39,98,500 equity shares to the shareholders of erstwhile Jindal Iron and Steel Company Limited.

b) 65,57,070 equity shares to the shareholders of erstwhile Euro Ikon Iron and Steel Private Limited.

c) 50,35,767 equity shares to the shareholders of erstwhile Euro Coke and Energy Private Limited.

d) 64,00,000 equity shares to the shareholders of erstwhile JSW Power Limited.

e) 1,50,35,712 equity shares to the shareholders of erstwhile Southern Iron and Steel Company Limited.

· 3085814 equity shares represent the shares underlying outstanding Global Depository Receipts (GDRs). Each GDR represents 1 underlying equity share.

· The 10% Cumulative Redeemable Preference Shares are redeemable at par in four equal quarterly installments commencing 15^th December, 2017.

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2011	31.03.2010	31.03.2009
SHAREHOLDERS FUNDS
1] Share Capital		5631.800	5271.100	5370.100
2] Share Application Money		0.000	0.000	0.000
3] Share Warrants		5293.800	0.000	0.000
4] Reserves & Surplus		161327.100	91792.300	74222.400
5] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		172252.700	97063.400	79592.500
LOAN FUNDS
1] Secured Loans		76758.200	89875.100	82146.100
2] Unsecured Loans		42755.200	25975.900	30580.200
TOTAL BORROWING		119513.400	115851.000	112726.300
DEFERRED TAX LIABILITIES		23170.400	19649.500	14211.600
TOTAL		314936.500	232563.900	206530.400
APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		211021.500	168661.400	130864.400
Capital work-in-progress		61690.500	66842.700	92420.600
INVESTMENT		40988.100	17683.500	12501.100
DEFERREX TAX ASSETS		0.000	0.000	0.000
CURRENT ASSETS, LOANS & ADVANCES
	Inventories	41384.100	25857.700	20514.200
	Sundry Debtors	8386.500	5632.500	3981.400
	Cash & Bank Balances	18868.800	2871.100	4199.600
	Other Current Assets	0.000	0.000	172.400
	Loans & Advances	33244.300	21233.900	17448.800
Total Current Assets		101883.700	55595.200	46316.400
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	20306.500	15893.500	16444.300
	Other Current Liabilities	76366.800	57683.200	58318.500
	Provisions	3974.000	2642.200	809.300
Total Current Liabilities		100647.300	76218.900	75572.100
Net Current Assets		1236.400	(20623.700)	(29255.700)
MISCELLANEOUS EXPENSES		0.000	0.000	0.000
TOTAL		314936.500	232563.900	206530.400

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2011	31.03.2010	31.03.2009
	SALES
		Net Turnover	231632.400	182024.800	140012.500
		Other Income	2826.400	5290.800	2595.600
		TOTAL (A)	234458.800	187315.600	142608.100
Less	EXPENSES
		Materials	142541.000	104606.800	84501.000
		Employees’ Remuneration and Benefits	5344.700	3652.000	2887.500
		Manufacturing and Other Expenses	38011.400	31037.000	24292.900
		Exceptional Items	0.000	0.000	7901.300
		TOTAL (B)	185897.100	139295.800	119582.700
Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		48561.700	48019.800	23025.400
Less	NET FINANCE CHARGES (D)		6951.800	8589.200	7972.500
	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		41609.900	39430.600	15052.900
Less/ Add	DEPRECIATION/ AMORTISATION (F)		13787.100	11234.100	8276.600
	PROFIT BEFORE TAX (E-F) (G)		27822.800	28196.500	6776.300
Less	TAX (H)		7716.100	7969.100	2191.300
	PROFIT AFTER TAX (G-H) (I)		20106.700	20227.400	4585.000
Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		53277.800	38831.500	35058.600
Less	APPROPRIATIONS
		Transfer to Debenture Redemption Reserve	0.000	1250.000	(204.500)
		Transfer to Capital Redemption reserve	0.000	99.000	0.000
		Dividend on Preference Shares	279.000	289.200	289.900
		Proposed Final Dividend on Equity Shares	2733.200	1777.000	187.100
		Corporate Dividend Tax	488.700	343.100	81.100
		Transfer to General Reserve	42000.000	2022.800	458.500
	BALANCE CARRIED TO THE B/S		27883.600	53277.800	38831.500
	EARNINGS IN FOREIGN CURRENCY
		FOB Value of Exports	33282.500	26837.800	41131.500
		Sale of Carbon Credits	386.700	602.100	485.800
		Interest Income	457.600	280.300	329.700
	TOTAL EARNINGS		34126.800	27720.200	41947.000
	IMPORTS
		Capital Goods	14829.900	19358.500	16040.000
		Raw Materials	87326.400	63337.200	60321.900
		Stores and Spare Parts	2784.400	1728.200	1825.600
	TOTAL IMPORTS		104940.700	84423.900	78187.500
	Earnings Per Share (Rs.) Basic Diluted		97.17 96.33	106.34 105.94	22.70 22.70

QUARTERLY RESULTS

PARTICULARS	30.06.2011 Unaudited
Net Sales	70693.800
Total Expenditure	56754.900
PBIDT (Excl OI)	13938.900
Other Income	168.800
Operating Profit	14107.700
Interest	1966.100
Exceptional Items	0.000
PBDT	12141.600
Depreciation	3878.900
Profit Before Tax	8262.700
Tax	2479.500
Provisions and contingencies	0.000
Profit After Tax	5783.200
Extraordinary Items	0.000
Prior Period Expenses	0.000
Other Adjustments	0.000
Net Profit	5783.200

KEY RATIOS

PARTICULARS		31.03.2011	31.03.2010	31.03.2009
PAT / Total Income	(%)	8.58	10.80	3.22
Net Profit Margin (PBT/Sales)	(%)	12.01	15.49	4.84
Return on Total Assets (PBT/Total Assets}	(%)	8.89	12.57	3.82
Return on Investment (ROI) (PBT/Networth)		0.16	0.29	0.09
Debt Equity Ratio (Total Liability/Networth)		1.28	1.98	2.37
Current Ratio (Current Asset/Current Liability)		1.01	0.73	0.61

LOCAL AGENCY FURTHER INFORMATION

DETAILS OF SUNDRY CREDITORS

Particulars	As on 31.03.2011 Rs. in millions	As on 31.03.2010 Rs. in millions	As on 31.03.2009 Rs. in millions
Total Outstanding dues of micro enterprises and small enterprises	159.200	381.500	307.900
Total Outstanding dues of creditors other than micro enterprises and small enterprises	20147.300	15512.000	16136.400
Total	20306.500	15893.500	16444.300

Sr. No.	Check List by Info Agents
1.	Year of Establishment	YES
2.	Locality of the firm	YES
3.	Constitutions of the firm	YES
4.	Premises details	YES
5.	Type of Business	YES
6.	Line of Business	YES
7.	Promoter’s background	--
8.	No. of employees	YES
9.	Name of person contacted	YES
10.	Designation of contact person	YES
11.	Turnover of firm for last three years	YES
12.	Profitability for last three years	NO
13.	Reasons for variations <> 20%	NO
14.	Estimation for coming financial year	NO
15.	Capital in the business	YES
16.	Details of sister concerns	YES
17.	Major Suppliers	NO
18.	Major Customers	NO
19.	Payment terms	YES
20.	Export / Import details (is applicable)	YES
21.	Market information	--
22.	Litigation that the firm / promoter involved in	--
23.	Banking Details	YES
24.	Banking facility details	NO
25.	Conduct of the banking account	--
26.	Buyer visit details	--
27.	Financials, if provided	NO
28.	Incorporation details, if applicable	--
29.	Last accounts filed at ROC	--
30.	Major Shareholders, is available	--

FINANCIAL RESULTS

The Company achieved a favourable product mix during the year, mainly due to increase in rolled products, with the rolling of most of the available cast products. This helped in reducing the sale of semis (cast products) in the overall product mix to around 6%(vis-a-vis 22% in last year) which in turn helped in improvement in blended sales realization compared to that of with previous year.

The Company achieved a volume growth over previous year of 7% in crude steel production during the current year. It had achieved crude steel production of 6.427 Million tones (the overall production was 6.506 Million tonnes, considering trial run production from the expansion project) and volume of sales of 6.099 million tonnes.

The interest cost has come down due to prepayment and repayment of high cost debt out of proceeds of equity investment by strategic investor JFE Corporation, Japan.

The Gross Turnover and Net Turnover for the year stood at Rs.251307.600 millions and Rs.231632.400 millions, respectively, showing a growth of 29% and 27% over the previous year mainly driven by growth in volumes and improved product mix and increase in blended sales realizations.

The EBIDTA for the year was Rs.48561.700 millions and EBIDTA margin for the year was20.8%. The Company posted PAT of Rs.20106.700 millions.

Pursuant to Accounting Standard AS-21 issued by the Institute of Chartered Accountants of India, consolidated financial statements presented by the Company include financial information of its subsidiaries. In the context of globalising Indian economy and the increase in the number of subsidiaries, the Ministry of Corporate Affairs, vide its General Circular No. 2/2011 dated 08.02.2011 has granted General Exemption to all companies from attaching the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies to the Balance Sheet of the Company subject to fulfilment of certain standard conditions generally prescribed while giving specific approvals. The Company will make available these documents/details upon request by any member or investor of the Company/subsidiary companies. Further, the Annual Accounts of the subsidiary companies will be kept open for inspection by any investor at the registered office of the Company and also that of the subsidiary companies.

Consolidated Financial Statements also reflect minority interest in associates as per Accounting Standard (AS) - 23 on "Accounting for Investments in Associates in Consolidated Financial Statements" and proportionate share of interest in Joint Venture as per Accounting Standard (AS) - 27 on "Financial Reporting of Interests in Joint Ventures".

As per the Consolidated Financial Statements, the Gross Turnover, Net Turnover, EBIDTA and PAT of the Company are Rs.258678.000 millions, Rs.239002.400 millions, Rs.49467.700 millions and Rs.17539.800 millions, respectively. The PAT on consolidated basis was lower than the standalone net profit, due to losses in overseas subsidiaries attributable to slow recovery from global meltdown.

SCHEME OF ARRANGEMENT AND AMALGAMATION

The Company concluded the Scheme of Arrangement and Amalgamation approved by the Hon’ble High Courts of Bombay and Karnataka vide order dated 3rd September, 2004 and 20th January, 2005 respectively with the merger of steel business of Jindal Iron and Steel Company Limited with the Company.

The merger, undertaken to unleash value for shareholders, has created India’s third largest Integrated Steel manufacturer with competitive synergies across the entire value chain (iron ore to pre-painted galvanized products) of the steel industry.

The Directors are optimistic that this merged entity possesses attractive economies of scale, cost, gearing and synergy straddling a whole value chain; this will enable the Company to compete successfully across periods, segments and geographies.

PROJECTS AND EXPANSION PLANS

The status of progress made on various Projects of the Company was as follows:

VIJAYANAGAR WORKS

(a) Projects commissioned during FY 2010-11

· The implementation of the state-of-the art new Hot Strip Mill with a capacity of 5mtpa was taken up in two phases. Phase-I with a capacity of 3.5 mtpa was successfully commissioned on March 28, 2010. After successful trial runs, the Mill commenced commercial loperations on April 10, 2010. Phase II implementation is progressing well.

· The 3.2 mtpa expansion project at Vijayanagar Works is progressing in full swing.The overall crude steel capacity of the Company will go upto 11 mtpa on completion of this project. The following facilities were commissioned / part commissioned during the year:

• Ladle Heating Furnace-3 and 4, Converter-3 and 4 and Caster-3 and 4 were commissioned in phases by March 2011.
• Sinter plant 3 (5.75 mtpa capacity) was commissioned in February 2011 – the largest such facility in India.
• 300MW captive power plant (CPP 3) was commissioned in September 2010.
• Two of the four batteries (Battery A and B) of coke oven 4 (1.95 mtpa capacity) were commissioned in December 2010. Battery C was commissioned in the month of April 2011while heating of Battery D is underway.

• First phase of the 20 mtpa beneficiation plant was commissioned in phases in April 2011.

(b) Projects under Progress

Following projects are under different stages of implementation:

· The balance units of 3.2 mtpa expansion project viz, Blast Furnace 4, Lime plant, Water pipeline will be commissioned by June 2011.

· Second phase (capacity of 1.5 mtpa) of the new HSM, taking the rolling capacity of this facility to 5 mtpa by September 2012.

· Pellet plant 2 (capacity 4.2 mtpa) expected to be commenced by June 2011.

· Second phase of the Beneficiation plant by November 2011, taking the total capacity of beneficiation to 20 mtpa.

· 300 MW Captive Power Plant (CPP4) at Vijayanagar, to be commissioned by December 2011.

(c) Projects proposed

New Cold Rolling Mill Complex

The Company has decided to set-up a new Cold Rolling Mill Complex of 2.3 mtpa in twophases at its Vijayanagar Works, considering the growing demand from consumer durable andautomobile segment for CRCA products. The proposed complex will have 2.3 mtpa of Picklingcum coupled tandem Cold Rolling Mill, 1.9 mtpa (two lines of 0.95 mtpa each) of State ofthe art Continuous Annealing lines and 0.4 mtpa of Galvanising cum Galvannealing line.

Total investment is about Rs.40250.00 millions, and is proposed to be funded by a debt equity ratio of 2:1. The target date of completion is 01 2013-14 for Phase-I and 012014-15 for Phase-II.

Augmenting crude steel capacity from 10 mtpa to 12 mtpa at Vijayanagar works

The Company has made assessment of the existing facilities at Vijayanagar Works andbased on the Endings, it has been decided to increase the capacity by an additional 2mtpa.

The proposed project cost is about Rs.26950.000 millions and is to be financed out of cash accruals of Rs.9450.000 millions and the balance by debt and is expected to be commissioned by June 2013.

SALEM WORKS

(a) Projects commissioned during FY 2010-11

Phase I of the Blooming Mill (capacity 0.25 mtpa) was commissioned in September 2010.

(b) Projects under progress

Phase II of the Blooming Mill (capacity 0.25 mtpa) is in progress and the same isexpected to be commissioned by September 2011. On completion of phase II the Company willhave matching rolling capacity for cast product at Salem unit.

VASIND WORKS

Projects under progress

· Railway siding project is in an advanced stage of completion.

· Project RLNG to replace expensive fuel usage, is expected to be completed by June 2011.

SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES

INDIAN SUBSIDIARIES

JSW Bengal Steel Limited (JSW Bengal), its Subsidiaries Barbil Beneficiation Company Limited, JSW Natural Resources India Limited and its Associate JSW Energy (Bengal) Limited(JSWEBL)

JSW Bengal Steel Limited was incorporated for setting up an Integrated Steel Plant in the State of West Bengal. The Company has already acquired and is in possession of Land required for this project. Boundary wall work at Salboni site has been completed to amajor extent. The Company has also started construction of a residential complex by the name "Ankurfi' for the employees stay during construction of the plant. All the major survey work has already been completed at site. Power as well as water for construction is already tied up. Drilling and 3 Dimensional High Resolution Seismic Survey (3 DHRSS) arein progress at Kulti-Sitarampur Coal block by JSW Natural Resources India Limited.

JSW Bengal is planning to invest Rs.160000.000 millions in phase I of this project. The Company is drawing up plans for achieving financial closure.

JSW Jharkhand Steel Limited

JSW Jharkhand Steel Limited was incorporated for setting up a steel plant in the State of Jharkhand. Approvals for setting up the project are being pursued.

JSW Steel Processing Centres Limited (JSWSPCL)

JSWSPCL is a 100% subsidiary of the Company. The subsidiary company was set up as Steel Service Centre consisting of HR/ CR Slitter and cut to length facility with annual slitting capacity of 5,00,000 tonnes. The Company processed 4,97,112 tonnes of steelduring the FY 2010-11, as compared to 3,04,718 tonnes in the previous year.

During the previous year, JSWSPCL purchased 3 Slitting Lines and 1 Multi Strand Blanking lines from its fellow subsidiary JSW Steel Service Centre (UK) Limited.

JSW Building Systems Limited (JSWBSL)

JSWBSL, a 100% subsidiary, was incorporated with its main object as to design, make, prepare, develop, create, alter, replace, repair pre-fabricated building systems and technologies.

OVERSEAS SUBSIDIARIES

· JSW Steel (Netherlands) B.V. (JSW Netherlands)

JSW Netherlands is a holding Company for USA, UK and Chile based subsidiaries. It hasparticipation in 49% equity of Georgia based Geo Steel LLC, incorporated under the laws ofGeorgia. The Company has also invested in plate and pipe mill in USA, Coal mining assetsin USA, iron ore mining concessions in Chile and Service Centres (since shutdown) at UKthrough the following step down subsidiaries.

JSW Steel Holding (USA) Inc. and its subsidiaries viz. JSW Steel (USA) Inc - Plateand Pipe Mill Operation and Periama Holdings LLC and its subsidiaries - West Virginia, USAbased Coal Mining Operation.

Plate and Pipe Mill operation

For the year 2010-11, the Subsidiary Company produced 119,887 net tonnes of Plates and42,148 net tonnes of Pipes and achieved capacity utilization of 11% and 8% respectively. Considering the signs of improvement in US economy, it is expected that plate and pipe mills performance should improve during FY 2011-12.

Coal Mining operation

During the previous year, JSW Steel Holding (USA) Inc. acquired 100% equity interest inWest virginia, USA based coal mining concessions along with barge load out facility.

Out of the total seven mines acquired, one mine is currently operational. For other mines, process of getting statutory clearance/permits is at an advanced stage of approval.

It is expected to produce approximately 0.50 million tonnes of Coal in the FY 2011-12subject to receipt of requisite permits, which is planned to be ramped up to 3 million tonnes in over 3 years.

JSW Steel (UK) Limited and its Subsidiaries namely Argent Independent Steel (Holdings) Limited and JSW Steel Service Centre (UK) Limited

While the European economy is still struggling to come out of recessionary condition, there is growth of Auto and Consumer Durables Industry in India and there is a logical growth of 'Steel Stockholding and Service Centre Industry' in India. In these circumstances, Plant and Machinery of UK Service Centre consisting of 3 Slitting Linesand 1 Multi Strand Blanking lines was sold to JSW Steel Processing Centres Limited, a subsidiary of the Company for relocation and use in India.

JSW Panama Holdings Corporation and its Chilean subsidiaries namely Inversiones Eurosh Limitada (lEL), Santa Fe Mining (SFM) and Santa Fe Puerto S.A (SFP)

During the financial year 2010-11, SFM commenced the contract mining activity through dry process route with a capacity of 1 mtpa. The first shipment of Iron ore concentrate was made in April 2011.

Work on putting up a wet beneficiation plant of 2.5 mtpa is currently being examinedand necessary statutory and environmental approvals are being applied for.

SFP, a subsidiary of SFM received maritime concession in April 2011 for developing acape size port in North Caldera. The environmental and other regulatory approvals areapplied for and are in progress.

· JSW Natural Resources Limited (JSWNRL) and its Subsidiaries JSW Natural Resources Mozambique Limitada (JSWNRML), JSW ADMS Carvao Limitada

JSW Natural Resources Limited was incorporated in Mauritius to pursue acquiring coalassets/other assets relating to steel business.

JSW Natural Resources Limited formed a wholly owned subsidiary - JSW Natural Resources Mozambique Limitada in Mozambique to acquire Coal assets and engaging in the business of prospecting and exploration of Coal, Iron Ore and Manganese.

In one of the mining concession where coal is found, Company has started with detailed drilling activities to establish JORC compliant reserve estimates.

JSW Natural Resources Mozambique LImitada incorporated JSW ADMS Carvao Lda on October 8,2010 wherein 85% stake is owned by JSWNRML and remaining 15% stake is with minority shareholder. It has a mining concession in Zumbo District Tete Province. The Company hasinitiated drilling activities to prove and confirm the quality and quantity of coalreserve.

JOINT VENTURE COMPANIES

Geo Steel LLC

Georgia based Joint Venture Geo Steel LLC in which your Company holds 49% equitythrough JSW Steel (Netherlands) B.V, has set up a steel rolling mill in Georgia withannual production capacity of 175,000 tonnes across 13.50 hectares in the industrial areaof Rustavi in Georgia. The plant became operational during year 2009-10. It is designed toproduce rebar through hot rolling process by using steel billets produced through theElectric Arc Furnace Route.

Geo Steel produced 85,449 tonnes of Rebar and 95,901 tonnes of Billets during the FY2010-11.

Rohne Coal Company Private Limited

The Company holds 49% equity in Rohne Coal Company Private Limited. (JSW group is holding 69.01%, including that of the Company), which is a Joint Venture with three other partners (two partners from outside the Group). Forest clearance and Mining lease proposal is beingpursued with Government authorities.

MJSJ Coal Limited

In terms of the Joint Venture Agreement to develop Utkal - A and Gopal Prasad (West)thermal coal block in Orissa, the Company agreed to participate in the 11% equity ofnewly formed MJSJ Coal Limited, Orissa along with four other partners. The Government of India has decided to allot 1,522 acres of Gopal Prasad west area to MJSJ Coal Limited. Mahanadi Coalfields Limited, a Public sector company holds 60% of the equity. Land acquisition process is under progress.

Gourangdih Coal Limited

Gourangdih Coal Limited (GCL) is a 50:50 Joint Venture between JSW Steel Limited and Himachal EMTA Power Corporation Limited (HEPL) incorporated for development and mining of coalfrom Gourangdih ABC Thermal coal block in the state of West Bengal. It is currently progressing on pre mining activities.

Toshiba JSW Turbine and Generator Private Limited

Toshiba JSW Turbine and Generator Private Limited has been incorporated with a shareholding of 75% by Toshiba Corporation Limited, Japan, 20% by JSW Energy Limited and 5% by the Company, to design, manufacture, marketing and maintenance services of mid to large sized Supercritical Steam Turbines and Generators of size 500 MW to 1,000 MW.

Trial production of blades started on March 2011. The construction and erection of main plant equipment erection is progressing well.

Vijayanagar Minerals Private Limited (VMPL)

During the financial year 2010-11, VMPL supplied 2.20 million tonnes of Iron Ore from Thimmappanagudi Iron Ore Mines, vis-a-vis 1.76 million tonnes in the last FY 2009-10. VMPL has planned to supply 3.00 million tonnes during the next FY 2011-12.

JSW Severtield Structures Limited and its Subsidiary JSW Structural Metal DeckingLimited

JSW Severfield Structures Limited (JSSL) has set up a Greenfield project for design, fabrication and erection of structural steelwork and ancillaries, including decking for construction projects with a total plant Capacity of 35,000 tonnes per annum at Bellary in Karnataka. The commercial production of the first fabrication line commenced in November2010 and the second fabrication line was commissioned in March 2011. The Company hasproduced a total of 3425 tonnes during the year. The order book of the Company stood at Rs.1200.000 millions (8370 tonnes) as on March 31, 2011.

JSW Structural Metal Decking Limited (JSWSMD), a subsidiary company of JSSL is engaged in business of the design, roll forming and installation of structural metal decking and ancillaries, including shear connectors, for construction projects with a total plant capacity of 10,000 tonnes per annum at Bellary in the State of Karnataka and started its commercial production in October 2010.

ASSOCIATE COMPANIES

Jindal Praxair Oxygen Company Private Limited (JPOCPL)

The oxygen plants of JPOCPL have been working satisfactorily primarily to meet the requirement of the steel plant operations at Vijayanagar Works. During the financial year 2010-11, the combined production of the oxygen plant module #1 and module # 2 of JPOCPL was: Gaseous oxygen - 1003.17 million Nm3; Gaseous nitrogen - 361.26 million Nm3; Liquid oxygen - 23.06 million Nm3; Liquid nitrogen - 30.25 million Nm3 and Argon - 11.01 millionNm3.

Ispat Industries Limited (IIL)

IIL re-started its operations in December 2010. It produced 0.729 million tonnes of HR Coils during the Quarter January to March 2011, and capacity utilization achieved was 88%.The volume of sales including downstream products improved to 0.712 million tonnes with an EBIDTA of Rs.4070.000 millions. Rejecting the synergies of acquisition, IIL turned into a profit making Company reporting a net profit of Rs.700.000 millions.

The Board of Directors have taken note of the matters to which the Auditors of IIL have drawn attention in their report, regarding overdue sundry debtors amounting to Rs.5716.000 millions, non-reconciliation of credit balances of Rs.1186.900 millions and raw material in-transit amounting to Rs.1048.300 millions.

The Board of Directors have also taken note of the confidence expressed by the management of IIL confirming that these matters will not have any material impact on the financial statements of IIL and relying on this, no provisioning has been considered necessary by the Board in respect of these items.

ACQUISITION OF MAJORITY STAKE IN ISPAT INDUSTRIES LIMITED

Ispat Industries Limited (IIL), with a production capacity of 3.3 mtpa, is inherentlyseen as a pioneering company that brought new technologies into India like the Twin Shell Con Arc furnace and Thin Slab Casting facility. The Twin Shell Con Arc furnace provides the steel making facility with a great amount of fiexibility. Along with the state-of-the-art Compact Strip Mill, Ispat also has an in-house jetty, with a cargo handling capacity of 12mtpa, which gives it an added advantage.

IIL has been incurring losses constrained by inadequate working capital, lack of integration and expensive debt and has been looking for a strategic investor to carry forward the business and growth of the Company. The Company in turn has been looking at growth opportunities/expansions to reach 34 mtpa by 2020 and has plans to further expand steel making capacity in West Bengal and Jharkhand with 10 mtpa capacity each. Any green field project has a gestation period of about 3-4 years. While many green field projects have been announced and MOUs executed, however due to challenges towards land acquisition, environmental and various other Government clearances, not many Green field projects are expected to get into operations in the near future.

Considering the synergies and strategic fit, the Company initiated dialogue with the management of IIL for strategic collaboration and arrived at a proposal whereby the Company would acquire a majority stake in IIL.

Accordingly, in accordance with the Subscription cum Shareholders Agreement dated December 20, 2010, the Company has acquired 1,08,66,49,874 equity shares of Ispat Industries Limited (IIL) on January 24, 2011 (aggregating to 45.53% of the equity share capital of IIL as on date).

In view of the above, the Company also made a mandatory open offer for the shares of IIL ("Open Offerfi') under Regulations 10 and 12 of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997("Takeover Regulations"). The Open Offer was made to the shareholders of IIL to acquire 64,72,38,458 Equity Shares of IIL of face value of Rs.10 each representing in the aggregate 20% of the Fully Diluted Equity Share Capital of IIL at a price of Rs.20.54(Rupees twenty and paise fifty four only) per fully paid up equity share, which was further revised to Rs.22.25 (Rupees twenty two and paise twenty five only) per fully paid up equity share on March 24, 2011.

The Offer was open from March 17, 2011 to April 05, 2011 during which time the Company received valid applications for sale of 8,99,40,890 equity shares from the shareholders of IIL. The Company has accepted all such valid applications and transferred the full amount of the purchase consideration to the Special Account opened for payment to the successful applicants on April 8, 2011.

Post the above acquisition, the Company holds 1,17,65,90,764 shares representing 49.30%of the total paid-up capital of Ispat Industries Limited as on that date.

The Company has also put in a systematic plan to turnaround Ispat Industries by developing synergies in the competitive steel market. The Company will also facilitate sourcing of key inputs like coke, pellet and power which will bring down the cost of production substantially. The Company's extensive Pan India Network will provide IIL with better market penetration. By improving the levels of efficiency and by rationalizing the sourcing of Iron ore lumps and fines, the Company will reduce the cost of production.

AWARDS AND ACCOLADES

The Company and its employees received the following awards during the year:

· PM's Trophy Award: (Runners-up Trophy known as Steel Minister's Trophy) for thebest performing integrated Steel Plant in the country for the year 2007-08, awarded on July 31, 2010.

· National Award for Excellence in Energy Management 2010: Excellent Energy Efficient Unit Award 2010 at National Award for Excellence in Energy Management 2010conducted by CII - Godrej GBC on September 1 and 2, 2010 at Chennai Trade Centre, Chennai.

· National Sustainability Award 2010: First Prize amongst the Integrated Steel Plants Category. The award was presented at 48th National Metallurgists' Day Celebrations and 64th Annual Technical Meeting of Indian Institute of Metals, on November 14, 2010 at Bangalore.

· CII-EXIM Award 2010: "Commendation Certificate for Significant Achievement" for Business Excellence by Confederation of Indian Industries, on November 14, 2010 at Bangalore.

· National Award for Excellence in Water Management 2010: Excellent Water Efficient Unit Award 2010 at National Award for Excellence in Water Management 2010 conducted by CII, on December 10 and 11, 2010 at Hyderabad.

· IMC Ramkrishna Bajaj National Quality Award 2010: Commendation Certificate in the manufacturing category on March 16, 2011 at Mumbai.

· Global HR Excellence Award 2010 for Innovative HR Practices at Asia Pacific HRMCongress held on September 3, 2010 at Bangalore.

· Best Practices in Talent Management Award at Talent 2010 hosted by Osney Media Limited on November 10 and 11, 2010 at London.

· "Institution Building Award" at Global HR Excellence Awards World HR hosted by World HR Congress on February 11, 2011 at Taj Lands End, Mumbai.

MANAGEMENT DISCUSSION AND ANALYSIS

ECONOMY AND STEEL SECTOR

GLOBAL ECONOMY

Overview

The global economy expanded by 5.0% in 2010 as against 0.5% in 2009. This recovery was characterised by:

· Moderate growth in advanced economies, spurred by stimulus measures. Private consumption which fell sharply during the crisis picked up.

· Growth in emerging and developing economies remained robust buoyed by resurgent capital inflows due to abundant global liquidity and strong domestic demand.

· Global liquidity improved, credit spreads narrowed, equity and debt capital markets opening up enabling several corporations to raise capital to meet funding requirements.

Challenges

Pockets of vulnerability persisted; real-estate markets and household incomes remained weak in some major advanced economies. Volatility and uncertainty re-emerged in Euro area.

Concerns about banking sector losses and fiscal sustainability triggered by crisis in Ireland, Spain, Greece and Portugal led to unprecedented widening of credit spreads for these countries.

The turmoil in mid-2010 in the Euro zone led to a spike in global risk aversion and scaling back of capital allocation by fund managers to emerging markets. However, during the recent bout of turbulence, the financial stress was limited primarily to the periphery of the Euro area. Quantitative easing and stimulus packages by several countries created huge liquidity in financial markets and Central banks in emerging economies faced the challenge of high inflation and started pursuing a hawkish monetary policy by raising reserve ratios and hiking policy rates.

Natural disasters across the globe posed a significant challenge for global economicg rowth. Floods, earthquakes and drought among others took a massive toll on human life, resulting in wealth erosion.

Estimates for 2011

The global economy is on a recovery path while Advanced economies are expected to pickup growth momentum. The emerging economies will consolidate with moderate growth as the focus is shifted to contain inflation rather then pursuing growth.

Advanced economies: The growth is projected at 2.6% in 2012. The new fiscal packages passed in late 2010 in the US and Japan will boost economic growth in 2011.Although growth in the periphery of the euro area is marked down for 2011, this will off set by an upward revision in economic growth in Germany, owing to stronger domestic demand.

Emerging and developing economies: In 2011, growth in emerging and developing economies is expected to be at 6.5%, a modest drop from 7.30% registered in 2010.Developing Asia will continue with its rapid growth. Other emerging regions are expected to continue their strong rebound; notably, growth in sub-Saharan Africa - projected at5.5% in 2011 - higher than the economic growth in all other regions, except developing Asia.

GLOBAL STEEL INDUSTRY

The CY 2010 could be rated as the year of 'broad based recovery', in terms of economic revival, steel production, trade and consumption, except the threat of sovereign defaults in parts of Europe. Besides, weather extremities namely, extreme heat and cold waves, drought, floods, cyclones, among others are also causes of concern.

The Global Steel Industry reached a new high in 2010 after a disastrous 2008. The global demand growth was at 13% after a steep fall in 2008. Asia was the leading steel producer with a 64% share in the global crude steel production. China was the largest producer with a 44% share, India ranked fifth in world crude steel production.

The steel demand in advanced economies recovered, stimulated from social spending by governments, the demand in rest of the world, including China continued to expand.

The contribution of emerging economies to the growth in world steel production and consumption is evident as stated hereunder:

World crude steel production	: +184 MnT (+15% YoY) with advanced market economies contributing ~45% while emerging market economies excl. China at 26% and China at 29%.
World finished steel consumption	: +149 MnT (+13.1% YoY) with advanced market economies contributing 41% while emerging market economies excl. China at 40% and China at 19%.

Surplus production from China and advanced economies was absorbed by growing imports from rest of the emerging world.

Production

In 2010, global steel production grew 15%, to 1,414 MnT. The growth is significant considering the huge downslide in steel production and consumption in the last quarter of2008 (due to the global economic crisis). The growth in 2010 exceeded the previous record set in 2007. Interestingly, the most significant rise in steel production in 2010 was in those geographies where it had contracted the maximum in 2008 and 2009, namely North America, Europe and Japan.

INDIAN ECONOMY

The Indian economy was one of the fastest growing economies to recover from the economic crisis, registering a second year of accelerated growth. The Indian economy grewat a robust rate of 8.50% in 2010-11 (8% in 2009-10).

Year 2010-11 witnessed fairly strong economic growth at 8.50% contributed by a strong growth in agriculture at 6.60%. Industry witnessed a moderation in growth from at 8% in2009-10 to 7.90% in 2010-11. Services continued to support the overall economic growth contributing around 58% to overall GDP.

Private consumption expenditure grew significantly in 2010-11, as a consequence of increasing disposable income. The growth was 22% and 26% respectively in consumer durables and passenger car segments.

In 2010-11, exports grew 37% to USD 246 billion against USD 179 billion in 2009-10; imports grew 22.6% to USD 351 billion in 2010-11 against USD 288 billion in 2009-10 -resulting in a trade deceit of USD 104 billion in 2010-11 against USD 109 billion in2009-10.

The confidence in the Indian growth story was rejected by the record Fll infiows into the economy and the revival in investor confidence, helping the Indian stock markets regain pre-crisis record levels. Net capital infiows increased to US$ 36.7 bn as on March31, 2010; foreign exchange reserves grew by US$ 20 bn to US$ 303.50 bn.

Challenges

Even though the macro economic data displayed a strong performance, they were marked by significant volatility, as evident from the data points and the sentiments primarily driven by global clues and policy responses to moderate inflation.

The headline inflation witnessed a relentless rise during the first half of 2010 and remained in double digits for almost five months in 2010. The uneven monsoon during 2009and domestic supply side constraints coupled with rising international food grain prices pushed the prices of primary food articles, manufactured goods and services.

As India witnessed robust growth, it was simultaneously challenged by rising commodity prices - both domestically and internationally. This was partially mitigated by timely intervention of the government through fiscal and monetary policy responses.

Optimism for 2011-12

Given the strong underlying growth momentum of the Indian economy, the outlook remains positive with a sustained increase in service sector growth, normalising agricultural output due to expected favourable monsoon and robust private consumption. Further, the substantial governmental outlays on building physical and social infrastructure with thrust on PPP model of development is expected to lead to sustained growth in industrial sector.

Economic activity is expected to take a step forward towards a high growth trajectory with GDP expected to grow at around 8.8% during 2011, as private demand gathers momentum and supports overall growth process.

INDIAN STEEL INDUSTRY

Snapshot (2010-11)

Overview

The Indian steel industry ranks fifth in the world with an estimated crude steel production of 63 MnT in FY 2010-11. Integrated steel producers contributed 55% of th etotal crude steel production in 2010-11 and 45% by secondary producers.

During the period from 1997-98 to 2000-01, steel production witnessed a marginal growth of 3% CAGR. However, during 2001-02 to 2007-08, owing to a boom in the infrastructure and auto mobile sectors, the industry witnessed a sharp turnaround and registered a steep hike of 12% CAGR.

In 2010-11, steel consumption grew at a healthy 10% from 59 MnT in 2009-10 to 66 MnT, owing to strong demand from the infrastructure, construction, automobile, and industrial sectors. Rising production capacities has reduced India's import dependency from 13% in2009-10 to about 10% in 2011-12.

Capacity addition programme

According to estimates by the Ministry of Steel, India is slated to add around 200 MnT of capacity during the next decade, increasing overall crude steel capacity from 78 MnT in2010-11 to around 280-290 MnT by 2020. Certain estimates suggest that India would emerge as the world's second largest steel producer by 2015-16.

Per Capita Consumption

India presents a high growth potential with its per capita finished steel consumption of 54 kg, compared with 430 kg in China and 187 kg globally. Interestingly, India's per capita steel consumption in rural locations is only 13 kg, with 70% of Indians residing in these areas. The government is making efforts to leave adequate income in the hands of the rural masses through attractive procurement prices for agricultural produce and NREGA scheme. Rural markets are expected to emerge as a huge opportunity for increasing steel consumption in the coming years.

India's Per Capita apparent steel consumption comparison C.Y. 2010/ FY 2010-11

i) Construction and Infrastructure

Infrastructure is the key to sustain India's economic growth. The challenge of successfully leaping over the "double digit growth barrier", can be over come only through higher investment in infrastructure.

The Eleventh Five Year Plan emphasised the importance of investment in infrastructure for achieving a sustainable growth of 9 to 10% in GDP over the next decade. In this context, it envisaged an increase in investment in physical infrastructure from about 5%of GDP witnessed during the Tenth Plan to about 9% of GDP by 2011-12 (terminal year of the Eleventh Plan). This requires an estimated investment of Rs.20561500.000 millions (US$ 514 bn) during the Eleventh Plan period as compared to an estimated investment of Rs.8714450.000 millions (US$ 218 bn) during the Tenth Plan period. An ambitious target of Rs.40992400.000 millions (US$ 1,025 bn) has been set for the Twelfth Five Year Plan.

Investment in infrastructure in the first 3 years of the Eleventh Plan Period well exceeded the target of Rs.9811190.000 millions. The actual investment was Rs.10658280.000 millions, which is 7.1% of the GDP and 9% over the planned expenditure. Investments in the power, telecommunications, irrigation and Oil and Gas pipelines have exceeded the target during this period.

The total bank lending to infrastructure has gone up from 12.5% of total nonfood credit at end-March 2010 to 14.4% by end-Feb, 2011, registering an impressive growth of 34%.

ii) Capital Goods

The development of a strong and vibrant engineering and capital goods sector has been at the core of the industrial strategy in India, since the planning process was initiated in 1951. The emphasis that this sector received was primarily influenced by the erstwhile Soviet Union model, though rapid state-led industrialisation, by developing the core engineering and capital goods sector. Following the liberalization of Indian economy in1991, private sector participation increased manifold in this sector thus accelerating the strong momentum.

India has a strong engineering and capital goods base today. The Indian capital goods sector is characterised by a large range of products (almost all major capital goods are domestically manufactured) - a legacy of the import substitution policy. Even nations with technologically advanced capital goods sectors do not produce the entire range of capital goods, but instead focus on segments, or sub segments.

The engineering sector employs about 2.6 million people directly, which accounts for 29% of the total workforce engaged in the organised sector. The industry is largely dominated by organised players, as the sector demands a high level of investment.

India's contribution to engineering exports constitute only 0.8% of the world. Total exports of engineering products grew from about US$ 13.2 billion in 2004-05 to US$ 60.15billion constituting around 25% of total exports from India registering a growth of 29%. A target of US$ 125 billion for engineering exports was set by the Ministry of commerce for the year 2013-14.

The growing industrialisation and demand from the various infrastructure sectors synergised the growth of the capital goods industry. The capital goods sector in the country registered a growth of 15% in 2010-11.

Since 100% FDI is permitted through the automatic route and considering the growth potential in India, several international players entered the Indian engineering sector, thereby increasing the competitiveness of the industry.

iii) Auto and Auto Components

In India, there are 100 people per vehicle, compared to 82 in China. The Indian automobile industry is expected to achieve mass motorisation status by 2014-15.

The brilliant performance of the automotive sector is attributed to improving infrastructure, excise duty reduction on passenger vehicles, easy financing of second hand vehicles, access to finance in rural and semi-urban areas and the emergence of India as a manufacturing hub for the automotive industry. Some of the unique features of the Indian automobile Industry are as under:

· India is emerging as a potential automobile hub.

· Foreign players are investing in the auto industry to create additional capacities.

· Two- wheeler motorcycles contribute 80% of the segment size.

· Unlike in the USA, the Indian auto industry is dominated by Passenger cars.

· 2/3rd of auto components production is directly consumed by the OEM's.

· India is the largest three-wheeler market in the world.

· India is the second largest two- wheeler manufacturer in the world.

· India is the 2nd largest tractor manufacturer in the world.

· India is the 7th largest commercial vehicle manufacturer in the world.

· India is the 4th largest car maker in Asia.

· India ranks 6th in passenger vehicles in the world after China, Japan, Germany,Korea and Brazil.

Subsequent to liberalisation, the automobile sector has been aptly described as the'sunrise sector' of the Indian economy since it has witnessed tremendous growth. At present 100% FDI is permissible under automatic route in this sector. The FDI in slows into this sector is around US$ 6 billion during 2010-11 (Apr-Feb). Since 1991, the number of manufacturing facilities in the automobile sector in India has grown progressively in line with the growing demand in the country. The auto manufacturers are investing to increase manufacturing capacity from present 3.6 Mn units to 4.5 Mn units.

The domestic sales of auto industry achieved a growth of 26% during 2010-11. Exports constitute around 12% of total sales, registering a growth of 30% in 2010-11.

Challenges

Iron ore: Although, India has the world's 8th largest reserve of iron ore and is the 4th largest iron ore producer globally, it exports about 54% of its production to other steel making nations - draining the nation of this precious natural resource and simultaneously importing steel from other countries. Since iron ore mines are not allotted to steel producers or approval for mining leases are delayed inordinately for value addition, no meaningful investment on the ground in the steel sector is happening to add new steel capacities.

Coking coal: A primary ingredient for steel making, is in short supply. It accounts for only 12% of India's total coal reserves. Further, government delays in allotting coal blocks for captive consumption by steel manufacturers is severely impacting the competitive edge of the Indian steel sector. India's coking coal imports surged 39%between 2009-10 to 2010-11. This refelects the import dependency of 62% in 2010-11. The import of coking coal is expected to go up to 42 MnT by 2011-12 from the current level of32 MnT. As an alternative solution, Indian steel producers acquired or on the lookout to acquire coal assets globally. As the operationalization of these assets takes considerable time, steel producers are beset with the problem of shortage of coking coal and they are constrained to import most of this coking coal requirement at exhorbitant prices.

Water: 1 tonne of steel production requires around 2.6 cubic metres of water, depending upon recycling of efficiency levels. Accordingly, water as a resource, isimmensely significant for producing steel.

Logistics: Every 1 tonne of steel generates a traffic of around 5 tonnes including the inbound and outbound material fiow. Accordingly, logistic infrastructure is of immense importance for the Indian steel sector for a number of reasons 1) raw material needs to bemet largely through imports, 2) steel consumption is widely dispersed across the country involving transportation of finished steel to consumption locations and 3) high logistics costs make transportation a huge challenge. The Indian railway network is in adequate; rakes are in short supply and port infrastructure is unable to cope up with increased volumes. Increasing fuel prices makes road transport costs prohibitive.

Expansion clearances: Land allocation, Mining leases, Environment and Forest clearances and Infrastructure connectivity for Greenfield expansions remain the major challenges impacting the creation of new capacities.

Product development: India's steel industry expenditure in R and D is still below1% of its total turnover. As the economy matures there is a growing need for special grades of steel like Boiler quality, API, Auto grade, requiring greater attention on technology and R & D.

Based on the recommendations of the Working Group on Steel Industry, a new scheme i.e., Scheme for Promotion of R and D in Iron and Steel Sector has begun with an outlay of Rs.1180.000 millions for the 11th Five Year plan. Under this scheme, R and D is being pursued in three major areas namely:

i) Development of innovative/path breaking technologies.

ii) Beneficiation and utilising of Indian iron ore fines and non-coking coal.

iii) Improvement of steel quality produced through induction furnace route.

Environment: Environment management and energy efficiency constitute an important benchmark for assessing any sector or company performance, both globally and in India. The Ministry of Steel through various schemes and regulations by the government is facilitating reduction in energy consumption and emission levels.

Subject has taken steps in each of these areas to remain competitive as explained in the following sections.

STEEL MAKING AT JSW

Operational Performance

Subject is India's leading steel manufacturer, with a steel manufacturing capacity of 7.8 mtpa.(which will increase to 11 mtpa by Q1 2011-12). The Company has four manufacturing facilities at the following locations: Vijayanagar (6.8 mtpa integratedsteel facility), known as the upstream unit, Tarapur and Vasind (for value-added flatproducts), referred to as downstream facilities and Salem (1 mtpa integrated steelfacility for long products of high value and special steels). The Company is among the few coveted integrated steel producers, with a presence across the entire value chain in flats and longs segment, and offers a variety of product basket.

Performance, 2010-11

The Company registered an improved performance in 2010-11, rejected in an increase in output - hot metal production increased by 8.5%, crude steel production increased by 7.4%and HR coil/sheets production increased by 41%. New facilities were commissioned, capacity was added, new products and new customers were introduced.

At Vijayanagar, ore availability improved from captive mines. As a result of stabilisation of operations at HSM 2, the volume of HR products has increased significantly. Salem Works emerged as the largest special steels unit in India following the commissioning of a blooming mill. Products from these units received approvals from a number of global OEMs. The downstream (Tarapur and Vasind) units recorded a higher production to address a significant demand in increase for coated products from the automotive and white goods sectors. A new 300 MW power generation facility was commissioned in 2010-11 at Vijayanagar.

Vijayanagar Works

Vijayanagar Works, which is subject's flagship unit has an annual capacity of 6.8mtpa which will increase to 10 mtpa in Q1 2011-12. It is Karnataka's only integrated steel facility and is widely acknowledged as a centre of steel making innovation.

This state-of-the-art facility is driven by a simple philosophy: 'Question every convention, replace the often quoted 'why' with the bolder 'why not''. The facility possesses contemporary technologies, has produced 5.77 million tonnes of steel (5.04million tonnes flat and 0.73 million tonnes long) in 2010-11 and redefined a number of global steel manufacturing benchmarks.

Different league

The Vijayanagar Works is the only landlocked integrated steel plant in the world with an annual capacity of 6.8 mtpa (will become 10 mtpa by Q1 2011-12). It is the largest steel manufacturing facility at a single location in India. The facility comprises the best technologies, the most cost-efficient global steel plant, zero discharge and extensive greenary that has increased local rainfall.

Preparatory section

Considering declining raw material volumes from any one vendor and deteriorating input quality, the beneficiation plant will play a very critical role in upgrading the inferior iron ore to superior feed for iron making units.

Highlights, 2010-11

· Witnessed a 16% increase of in-house manufactured coke from 2.32 million tones in 2009-10 to 2.70 million tonnes, reducing dependancy on high-cost imported coke.

· Commissioned a pilot coke oven facility to blend coal for sustaining coke quality and productivity.

· Entered into long-term arrangements for the sale of tar and sulphur.

· Enhanced pellet production by 14% from 3.17 million tonnes in 2009-10 to 3.62million tonnes in 2010-11.

· Commissioned the beneficiation plant for up-gradation of Iron ore quality.

· Increased sinter production by 13% from 4.62 million tonnes in 2009-10 to 5.24million tonnes; sinter quality improved considerably.

Key initiatives, 2010-11

The preparatory segment undertook a number of initiatives:

· Optimised coal cake charge in coke ovens 1 and 2, enhancing coke productivity.

· Reduced coal cake height, facilitating gas penetration throughout the cake; educed losses from the cake's core (not completely coked), improving coke yield and coke quality.

· Increased the semi soft-coking coal content in the coal cakes to 10%; optimized coal blend by using US coals for the first time.

· Improved utilisation of coke oven gas commissioning of the gas mixing station.

· Eliminated coke screening at coke oven; thereby improving usable coke yield.

· Altered the pellet making process, which eliminated dust generation in the pellet making process - a positive impact on the environment.

· Improved feed quality from beneficiation plants II and process modification, enhancing pellet production.

· Stabilised operations of sinter plant 3, the largest such facility in India; achieved a capacity utilisation of 66% within six weeks of commissioning.

· Ground and homogenised the sinter unit feed to the right size.

· Increased the quantum of mill scale into the sinter feed; increased process waste volume in sinter, reducing cost.

· Revamped the ESP at the sinter plant 1 for improved environment management.

Road ahead, 2011-12

· Commission the second phase of beneficiation plant II to process low grade fines to reduce costs.

· Modernise beneficiation plant I in line with the technology of beneficiation plant II, enabling it to upgrade iron ore quality.

Iron making zone

This segment constitutes the largest cost component in steel manufacture and its criticality lies in maximising the plant availability and optimising costs.

Highlights, 2010-11

· Witnessed a 11% increase in Hot metal production from 5.57 million tonnes in2009-10 to 6.19 million tonnes in 2010-11.

· Commissioned a coal briquetting unit to reduce hot metal production cost.

· Registered the highest metal production through BF 1 and 2 at 2.12 million tonnes (1.93 million tonnes in 2009-10).

· Stabilised BF3 operations and reported the highest monthly production of 9018TPD (March 2011), which is higher than the rated capacity.

· Achieved continuous tapping practice at BF3 for 30 hours every day (both taps functional 24 hours and some additional time of simultaneous operation); plant availability increased from 90% in 2009-10 to 97.5% in 2010-11.

· Manufactured and supplied more than 150,000 tonnes of API X grade steel (for pipe manufacturing) to domestic and international markets.

Key initiatives, 2010-11

The team undertook a number of productivity enhancement and cost optimization initiatives:

· Sustained optimum operation parameters in the corex units despite using coal from diverse sources.

· Reduced slag generation, increased hot metal production and reduced the fuel rate.

· Commissioned additional bunkers in the stock house for material storage; increased the minimum stock level in the bunkers which reduced fines generation when material was stored in bunkers.

· Installed one turbo blower which will act as standby for both Blast furnace 1and 2.

· Replaced the electrical actuated system used for operating stoves in BF 1 with hydraulic systems; this provided consistent air fiow to the furnace and improved productivity.

· Replayed thermo couples (instruments used to measure the temperature in the furnace with a usable life of around 6 months) in the stove dome with pyrometers(indefinite life), improving furnace availability.

· Upgraded the boiler control in BF 1 from manual to PLC-based control, improving furnace availability.

· Replaced calibrated ore with sinter in the furnace feed in BF 1 and 2, saving costs.

· Developed an ore washing facility in BF 3 which washed out the fines from the furnace feed, improving furnace productivity.

· Replaced single chamber tuyere by double chamber tuyere in BF 3 - a buffer arrangement that eliminated the need of furnace shutdowns/ process interruptions due to tuyere burning.

· Altered the nut coke screen in BF 3, enhancing net nut coke consumption and lowering the cost of screening fines.

· Reused blow water from BF gear box, secondary cooling circuit of BF 3, in GCP, saving 500 m3/day of make-up water; replaced industrial water with seepage water in slag granulation unit which saved 200 m3/day of make-up water.

Road ahead, 2011-12

· Convert the burden distribution technology in BF 2, expected to improve productivity.

· Measure the carbon footprint of every product and process, a European regulation expected to cascade to the Indian environment.

Steel melting shop

This zone converts hot metal to steel in various grades, each grade with a specific chemical composition that will allow its use for that particular application. Hence, in the steel melting shop, better productivity (through higher plant availability) and value-addition remain the team's focus.

Highlights, 2010-11

Produced 5.77 million tonnes of crude steel from the SMS facilities, 11% higherthan crude steel production in 2009-10; reduced hot metal handling loss from 1.68% in April 2010 to 1.62% in March 2011.

Key initiatives, 2010-11

· Enhanced converter utilisation, increasing average heats per day from 70 in2009-10 to 73 in 2010-11.

· Introduced lime fine injection at the desulphurising station, reducing overall calcium carbide consumption in the SMS facilities.

· Installed the auto scaring equipment which prevents oxygen contact with slab surface, minimising scale formation and enhancing surface quality.

· Developed 32 new grades of value-added steel.

· Improved gas recovery from 0.168 Gcal/TIs in 2009-10 to an average 0.176Gcal/Tls, which was used in generating power and other processes.

Road ahead, 2011-12

Commission SMS 2 with additional caster in Q1 2011-12.

Rolling section

These facilities add value to basic steel forms to create user-convenient forms; product grades (thickness and sizes) are customised to user applications; mill productivity is of prime importance to product quality and organisational profitability.

Highlights, 2010-11

· Recorded an increase in the proportion of HR products in the HSM 1 –thinner gauge products accounted for 32% of the production against 27% in 2009-10.

· Rolled 17 new product grades in HSM 1, catering to diverse user requirements.

· Commissioned HSM 2 with single furnace operations; achieved optimum capacity utilisation with single furnace; commissioned second furnace in February 2011, taking the mill's operational capacity to 3.5 mtpa.

· Received JFE Audit Certification at HSM 2 for being perfectly suited for rolling auto grade steel.

· Production at CRM increased by 18% from 0.735 million tonnes in 2009-10 to 0.87million tonnes in 2010-11.

· Commenced rolling special grades for leading automobile OEMs namely Ford Motors, Ashok Leyland, M&M and GM, among other leading brands; increased supplies to Hyundai Motors significantly.

· Developed new products, namely, steel for welding electrodes and leaded grade steel (exported to the US).

· Developed special TMT bars (500 ys and 550 ys grade) suited for infrastructure projects.

· Received the BIS Certification for welding grade steel and for TMT rods, expected to strengthen product acceptance for projects by institutional clients.

Key initiatives, 2010-11

Hot strip mill: The Company has two hot strip mills with a total cumulative label capacity of 6.7 mtpa. The first unit is capable of rolling products up to 1,350 mm width while the second HSM unit is the widest mill in India, equipped with sizing presses and an automatic line inspection facility, which makes it the first mill-of-its-kind in India. The combination of these two mills allows the Company to roll the widest range of HR coils in India.

· Improved operation and maintenance practices in HSM 1 strengthened plant utilisation from 84.9% in 2009-10 to 86.08% in 2010-11; prime yield also improved from94.67% in 2009-10 to 95.66% in 2010-11, bringing non prime/NCO to the new benchmark level of below 2.5%.

· Developed 17 new grades of steel to cater to diverse end user segments.

Cold rolling mill: The cold rolling mill is a state-of the-art mill with contemporary technology, the first-of-its-kind in India with complete automation. This is the first global instance of a single-stand skin pass mill (capacity 0.875 mtpa) in theelectrolytic line. The shape metre in the tail end of the skin pass mill for superior fatness to the rolled products is a pioneering technology in India and a rare feature in the global steel industry. The mill performance exceeded projections, resulting insizeable value-addition for the Company. During the year, the Company undertook the following improvements for superior performance:

· Increased jumbo HR coils feed in the cold roll mill; reducing material feeding time and improving mill productivity.

· Developed 13 new product grades, namely low carbon grades (extra deep drawn and deep drawn), IF grades, dual-phase trip steel (980 mpa strength) and HRPO 400/440, among others.

· Improved checklist and enhanced preventive care, resulting in better equipment utilisation; from 83% in 2009-10 to 86% in 2010-11.

· Optimised automatic sequence to increase productivity (from 121 tonnes per hour to about 129 tonnes per hour) and safety.

· Achieved crane centre marking; eliminating operational delay and enhancing productivity.

· Optimised packing cost though unique initiatives in packing practices.

Wire rod mill: The Company's wire rod mill is the fastest of its kind in India(drawing wire at 110m/sec); developing the largest product range (5.5 mm -22 mm) and roviding the maximum yield. It is also the only mill in India with an air cooling conveyor, allowing it to roll high carbon steel seamlessly. The team undertook the following improvements:

· Formed 25 cross functional teams within the wire rod mill for identifying and arresting minor problem areas in the mill.

· Reduced the overall gas consumption 13.7% by altering furnace temperature inline with the product thickness being rolled (low thickness products would imply low temperature in the furnace); it also reduced scaling on the billet.

· Reduced cobbles in the final product by undertaking timely preventive maintenance of the equipment.

· Reduced process wastage due to cobble, by pushing the billet nearest to the furnace exit door back into the furnace on the detection of a cobble.

Bar rod mill: This is the highest speed and widest range bar rod mill in India, capable of manufacturing a wide product mix (TMT, angle, square, engineered rounds, square round corners) and in multiple sizes (from 8mm to 40mm). The versatility extends to the product strength - the mill can develop products up to a maximum strength capability of1150 mpa. In 2010-11, the team implemented a number of mill improvement measures for improving the value-proposition from this facility:

· Augmented cooling facilities for converting the entire TMT production to 500grade TMT products (earlier about 75% was the 415 grade TMT).

· Developed the 50x50x6 angles and engineering round (4 sizes) for the first time- these products found strong acceptance from user segments.

· Adhered strictly to preventive maintenance schedules and minor process improvements, increasing yield from 93.5% in 2009-10 to about 96% in January 2011 and reducing the conversion cost in the bar rod mill.

Road ahead, 2011-12

The road ahead for the rolling mills would be towards productivity enhancement, developing superior product grades and optimising operational expenses:

In the hot rolling section, the team is working to ramp up the operations of the recently commissioned HSM 2 unit which will primarily roll high strength steel to be used in niche automotive applications.

The blueprint for the cold rolling section encompasses the following measures, enabling the Company to scale the value chain and cater to quality-stringent customers:

· Further enhance yield in the mills.

· Develop new product grades namely, EDD and IF grades skin panel for catering to MNC automobile clients.

· Roll substrata sourced from JFE facilities for meeting the requirements of global automotive players.

· Establish an electrolyte line for superior surface qualities.

· Set up the new 2.3 mtpa cold rolling mill which will roll high end products demanded by the automotive sector, namely dual-phase steel and strip steel.

The wire rod mill expects to enhance capacity utilisation, which was impacted in2010-11 owing to the non-availability of billets. The bar rod mill is working on upgradingTMT production to 100% 500D grade from the present 500 grade, strengthening realisations. As a branding exercise, the team expects to add equipment which will engrave the JSW brand and grade on the TMT product.

Salem, India's largest special steel plant

India's largest single location dedicated special steel facility is at the bottom oft he J-curve with a promise of accelerated growth in business and profitability growth.

Achievements, 2010-11

Operations

· Successfully stopped the production of TMT bars in December 2009 which wasre placed with special steels completely.

· Improved overall coke yield from 69.18% in 2009-10 to 69.98% in 2010-11; reduced coke fine generation.

· Achieved record coal fines injection of 139 kg per tonne of hot metal in the blast furnace in October 2010.

Products and markets

· Received product approvals from leading global automotive giants.

· Developed creep resistant boiler grade steel (T-11).

· Received approval for products developed for Indian Railways.

Key Initiative, 2010-11

· Modified the waste heat boiler of the coke oven plant which allowed 10% more waste heat to be recovered for onward power generation.

· Improved the stamp charging technique, increasing the BF coke percentage chargeable to the blast furnace from 90% in 2009-10 to 91.5% in 2010-11.

· Developed the Basket Test equipment to predict coke quality from coal blends, resulting in superior coke manufacture.

· Introduced a chemical binder in the sinter (when using large quantity of ore super fines as input); used granulated steel slag as the hearth layer in the sinter plant. These improvements enhanced sinter productivity from 2,800 tonnes per day in 03 2010-11 to about 3,100 tonnes per day in 04 2010-11.

· Increased the proportion of sinter in the blast furnace input from an average 57% in 2009-10 to an average 62% in 2010-11, reducing the use of coke and calibrated ore in the blast furnace which optimised production costs.

· Increased the injection of coal fines and dust to optimise costs.

· Injected chemical fluxes with coal fines in the blast furnace, reducing silicavariations in the hot metal and improving productivity in the steel making shop, a first for the Indian Steel Industry.

· Blended bed-recovered coal (coal spillage at various plant locations) with coal fines for injection as PCI in the blast furnace.

· Developed a unique air-conditioner which performed very well in dust-prone areas- example, hot metal zones, crane cabins, resulting in improved working conditions and productivity.

· Developed in-house, a unique burden probe mechanism that checked temperature and air flow at the top of the blast furnace (essential for monitoring complete combustion of the blast furnace burden) at a third of the prevailing cost.

· Optimised processes with minimal variations; modified process parameters in the ladle furnace, reducing oxygen in steel by 3 ppm and nitrogen by 8 ppm. This helped develop a larger number of grades and guarantee steel with an oxygen content <12 ppm(an international benchmark).

· Modified the billet caster to cast longer billets suited for the Vijayanagar wire rod and bar mills. This initiative minimised billet shortfall in Vijayanagar and what was sold as billets was now marketed as rolled products.

· Increased mill scale utilisation in the sinter manufacturing process as a cost effective replacement for iron ore without impacting product quality.

Products and clients

Developed more than 100 product grades for diverse customer requirements, largely focused on the automotive and auto-component sectors; each grade being customised for a specific customer.

Road ahead, 2011-12

· Implement modifications in the waste heat recovery boilers at the coke ovens for cost-effective power generation.

· Design a simplified test for determining coke fluidity from coal blends, which is expected to reduce testing time.

· Work with automotive OEMs to develop high-strength steel for leaf springs, reducing steel consumption and increasing fuel consumption per vehicle.

· Accelerate product approvals from OEMs.

· Work closely to develop automotive gear steels for application which are being imported.

· Implement automated testing facility for steel bar, thereby avoiding operator bias for OEM.

Environment management at Salem

· Replaced two-thirds of river sand used in the blast furnace runner with EOF slagfines, facilitating waste recycling.

· Introduced flue dust from the blast furnace as an additive in cement manufacture, which improved cement productivity for the cement company and dispose aprocess waste for the steel maker.

Downstream units focused on brand building

Subject’s Tarapur and Vasind facilities focus on value-addition, providing a wide product range (HR Pickled and Oiled coils, HR plates, CRCA products, galvanised, plain and corrugated products and colour-coated products) for multi-sectoral applications.

Subject possesses India's largest galvanised steel capacity; it has the prestigious Galvalume Certification of BIEC International Inc.; its colour-coated facility offers more than 200 shades of colour-coated galvanised products; it provides any shade of materialon-demand within three weeks.

Highlights, 2010-11

· Renamed Jindal Vishwas as JSW Vishwas and Jindal Vishwas Plus as JSW VishwasPlus to strengthen the JSW recall.

· Achieved the highest plant load factor of 102.56% (December 2010) in the newly commissioned 30 MW power plant at Tarapur.

· Increased the production of thinner gauges (< 0.20 mm) at Tarapur for export.

· Launched Pragati, a new product with lower zinc and paint coating for roofing application; this product was launched in West Bengal, Maharashtra and Gujarat.

· Conducted 1,000 hours of salt-spray test on the anti-finger print galvalume product.

Key initiatives, 2010-11

'Where change is constant' - This phrase fits best for the company team, where the labeled capacity is only the start to great achievements. The ability to see things differently and draw more from equipment is what sets JSW apart from other players in the Indian steel industry. In keeping with this passion, the teams operating the downstream units undertooka number of improvement/modification initiatives resulting in superior products, productivity and profitability.

Tarapur

· Replaced DC drives with AC drives in one galvanising line, saving 4 units of power per tonne and reducing breakdowns.

· Increased handling capacity at the entry section of the two colour-coated lines from 10 tonnes per coil to 25 tonnes, resulting into productivity and yield improvement.

· Commissioned the Trapezoidal Profile facility.

· Introduced the Eloguard chemical in the water used in the boiler, reducing DM water consumption in the power plant by 40%.

· Commissioned the Ammonia Injection system to ensure the SPM level from stack remains within the permissible incase of non-functioning of the ESP - an important environment management initiative.

· Commissioned a dry fog system in the coal and ash handling system to control coal and ash dust emissions.

· Installed islanding relay at the 11KV grid incoming feeder; completed relay setting with proper protection coordination for the successful islanding of the power plant against disturbances in the 132KV state power grid.

Vasind

· Commissioned the 1220 mm wide sophisticated Senfung machine, which provides multiple proxies to galvanised sheets. The equipment is equipped with flying-type profile shear, hydraulic system with variable speed and automatic roller type stacker arrangement which can cut up to 16 ft length sheets. This equipment generates scratch-free sheets with uniform profile and precise length accuracy.

· Installed and designed a plate length measuring device in the hot rolling plate mill, resulting in precise finished plate lengths with minimal rejections.

· Installed permanent electro-magnets in two cranes in the hot rolling plate mill for secure material lifting, enhancing the safety quotient in the plant.

· Commissioned new belt wrapper assembly in the galvanising line which reduced the scratches in the tail end of the coil, maintained coil tension right throughout winding, resulting in superior surface quality and improved yield of galvanised products.

· Developed and installed an auto soot blowing system in a waste heat recovery boiler for superior operations.

· Replaced existing electrical drives with energy efficient variants.

· Replaced flat belts for pulley drives leading to energy savings; replaced conventional acid pumps with energy-efficient variants.

· Established an environment control laboratory to check ambient air, stack and in-plant sampling, drinking water and effluents.

Road map, 2011-12

The downstream unit teams will draw up blueprints comprising, capacity addition and modifications to existing facility, enhancing value from downstream units.

Tarapur

· Upgrade the TM2 mill for higher production (output of 5000 t/ month CR > 0.25mm); install Thyristor drive in the mill, entry tension reel, delivery tension reel and pay-off reel.

· Modify the flux line in the 'heat to coat' furnace continuous coating line, boosting production by around 2,900 tonnes a month.

· Install Regenarating Re-generative Thermal Oxidiser in the colour coating line(CCL1) to reduce LPG consumption.

· Enhance the furnace capacity of CSD1 from 12 TPH (full hearth) to 16.5 TPH, permitting the team to develop new product grades.

· Install a Mangalorian Tile Profile machine to eliminate the need for external job working.

Vasind

· Commission the railway siding at Vasind.

· Commissioning of Natural gas project (from LPG/Furnace oil to natural gas); the gas pipeline is being routed by GAIL. The fuel conversion will be at the HR plate mill(furnace oil to natural gas) and the galvanising facility (from LPG to natural gas).

· Initiate product diversification, adding value-added produces to the product basket namely, galvanised products (EDD grades) for automobile and appliances and colour-coated sheets for structural application and appliances.

· Modification of CG1 for manufacturing EDD grade products to be value-added in new coating lines.

OUTLOOK

On macro scale, 2011 could be viewed as the year continuing to witness economic recovery, revival, resurgence, challenge of surging commodity prices, inflation and sovereign crisis. International Monetary Fund - IMF has projected Global Economic growth rate to marginally slow down from 5% in 2010 to 4.4% in quantitative terms the world output is estimated to grow by US $ 5.7 trillion. Advanced world as well as the Emerging and the Developing world are slated to witness a marginal reduction in economic growth rates at 2.4% and 6.5% respectively.

The year commenced with an unprecedented wrath of the natural calamities including the historic 3/11 catastrophe in Japan leading to a supply shortage in commodities as well as inputs for automobile and few downstream industries.

Steel Industries having strong linkages to the profile and growth rates of global economic expansion, is slated to show growth both in production and demand. However there is expected to be a marginal imbalance between the production rate vis-a-vis demand. China, with its 12th Five Year Plan activated, plans to focus on its domestic consumption with increasing emphasis on restructuring and development.

World Steel Association has projected the World Steel Demand growing by 77-MnT / 6% to1360-MnT, while China is expected to continue its Global dominance at 44% while growing at5% to 605-MnT. Advanced World is slated to witness demand growth at 5.3% while the Emerging and Developing world at 6.3%.

Indian Steel will see capacity additions to meet the accelerating domestic demand led by rising investments and consumption supplemented by growing export opportunities for value-added engineering products. As per the projection of world steel, Indian steel demand is estimated to grow on a strong footage @ 13.3% in CY 2011, while witnessing a growth of10.6% in production to 66-MnT in FY 2010-11.

Major challenges for Global Steel Industry in near term shall be sustainability of demand under rising inflationary pressure while cost pressures stueezing the margins. On the other hand, the bigger challenge going forward for the Global Steel Producers shall be to explore innovative technologies and processes for iron and steel making adapting alternate energy solutions with improved energy efficiency and low emission intensity.

UNAUDITED FINANCIAL RESULTS FOR THE QUARTER ENDED 30^TH JUNE, 2011

(Rs. In Millions)

Particulars	Standalone Unaudited Quartet Ended
	30.06.2011
1. Income
Domestic Turnover	62877.600
Export Turnover	13391.500
Sale of Carbon Credits	0.000
Total	76269.100
Less: Excise Duty	5623.400
Net Sales	70645.700
2. Other Operating Income	48.100
3. Total Income (1+2)	70693.800
4. Expenditure
a) (Increase) / Decrease in stock in trade and work in progress	(3563.700)
b) Consumption of raw materials	45931.600
c) Purchase of Traded Goods	775.000
d) Power and Fuel	4055.800
e) Employee’s cost	1765.600
f) Depreciation	3878.900
g) Other expenditure	7790.600
Total	60633.800
5. Profit from operations before other income and Net Finance Charges (3-4)	10060.000
6. Other income	168.800
7. Profit before Net Finance Charges (5+6)	10228.800
8. Net Finance Charges	1966.100
9. Profit before tax (7-8)	8262.700
10. Tax expense	2479.500
11. Net Profit after tax (9-10)	5783.200
12. Paid up equity share capital (Face value of Rs.10/- per share)	2231.200
13. Reserves excluding revaluation reserves
14. Earning per share (EPS)
(a) Basic (Rs.)	25.56
(b) Diluted (Rs.)	25.54
15. Public shareholding
- Number of shares	138974539
- Percentage of shareholding	62.29%
16. Promoters and Promoters group Shareholding	84142661
a) Pledged /Encumbered
Number of shares	23688055
Percentage of shares (as a % of total shareholding of the promoter and promoter group)	28.15%
Percentage of shares (as a % of total share capital of the company)	10.62%
b) Non Encumbered
Number of shares	60454606
Percentage of shares (as a % of total shareholding of the promoter and promoter group)	71.85%
Percentage of shares (as a % of total share capital of the company)	27.09%

SEGMENT-WISE REVENUE, RESULTS AND OTHER INFORMATION

(Rs. In Millions)

Particulars	Standalone Unaudited Quartet Ended
	30.06.2011
1. Revenue by Business Segment
Steel	73925.200
Power	4809.300
Total	78734.500
Less : Inter segment revenue	8040.700
Total Income	70693.800
2. Segment results before Net Finance charges and tax
Steel	9312.000
Power	757.600
Total	10069.600
Less : Unallocable items
Net Finance Charges	1966.100
Unallocable expense net of unallocable income	(159.200)
Profit before tax	8262.700
3. Segment Capital Employed (Segment assets less Segment liabilities)
Steel	254813.600
Power	19810.000
Unallocated	(96698.500)
Total	177925.100

Notes

· During the quarter, the Company has made additional investments aggregating Rs.2371.600 millions in subsidiary, associate and joint venture companies.

· During the quarter, the Company has acquired 8,99,40,890 equity shares of JSW Ispat Steel Limited (erstwhile Ispat Industries Limited) pursuant to the mandatory open offer in terms of SEBI (SAST) Regulations, 1997 at an aggregate value of Rs.2001.200 millions.

· Consolidated financial results for the quarter do not include the results of JSW Ispat Steel limited and its subsidiaries as its financials are not presently available.

· Paid up equity share capital does not include an amount of Rs.610.300 millions being the amount originally paid up on the equity shares forfeited in an earlier year.

· Comparative financial information has been regrouped and reclassified, wherever necessary, to correspond to the figures of the current quarter.

· Information on investor complaints (numbers)

• Pending at beginning of the quarter
• Received during the quarter 164
• Resolved/ replied during the quarter 164
• Unresolved at end of the quarter

· The auditors of the Company have carried out a Limited Review of the Standalone Financial Results for the quarter ended 30 June 2011 in compliance with Clause 41 of the Listing Agreement The Standalone and Consolidated financial results have been reviewed by the Audit Committee and approved by the Board of Directors at its meeting held on 26 July 2011

CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF (As on 31.03.2011)

A) Bills Discounted Rs.26218.600 Millions

B) Guarantees provided to banks on behalf of subsidiaries (including step down subsidiaries) and others Rs.16205.100 Millions

C) Disputed statutory claims/levies including those pending in courts (excluding interest, if any), in respect of:

(i) Excise Duty Rs.1797.000 Millions

(ii) Customs Duty Rs.2428.700 Millions

(iii) Income Tax Rs.124.700 Millions

(iv) Sales Tax/Special Entry tax Rs.723.600 Millions

(v) Service Tax Rs.451.800 Millions

(vi) Miscellaneous Rs.0.500 Millions

(vii) Levies by local authorities Rs.30.400 Millions

D) Claims by Suppliers and other third parties not acknowledged as debts Rs.2074.100 Millions

FIXED ASSETS

· Freehold Land

· Leasehold Land

· Building

· Plant and Machinery

· Furniture And Fixtures

· Vehicles and Aircrafts

· Software

WEBSITE DETAILS

PROFILE

JSW is part of US $10 billion O.P.Jindal Group. It has grown to US$ 5 billion in little over a decade and has presence across various sectors – Steel, Energy, Minerals, Port & Infrastructure, Cement, Aluminium and IT.

Subject, the flagship company of the JSW Group, is today an integrated steel manufacturer. Subject is the largest private sector steel manufacturer in terms of installed capacity.

The Group set up its first steel plant in 1982 at Vasind near Mumbai. Soon after, it acquired Piramal Steel Limited, which operated a mini steel mill at Tarapur in Maharashtra. The Jindals, who had wide experience in the steel industry, renamed it as Jindal Iron and Steel Company Limited (JISCO). In 1994, in order to achieve the vision of moving up the value chain and building a strong, resilient company, Jindal Vijayanagar Steel Limited (JVSL) was setup, with its plant located at Toranagallu in the Bellary-Hospet area of Karnataka, the heart of the high-grade iron ore belt and spread over 3,700 acres of land. It is just 340 kms from Bangalore, and is well connected with both the Goa and Chennai ports. In 2005, JISCO and JVSL merged to form subject.

Subject is one of the lowest cost steel producers in the world. It has established a strong presence in the global value-added steel segment with the acquisition of steel mill in US and a service center in UK. Subject has also formed a joint venture for setting up a steel plant in Georgia. The Company has also tied up with JFE Steel Corp, Japan for manufacturing the high grade automotive steel. Subject has recently acquired a majority stake in Ispat Industries Limited. This will make subject India’s largest steel producer with a combined capacity of 14.3 MTPA by March 2011. The Company has also acquired mining assets in Chile, USA and Mozambique.

Subject offers the entire gamut of steel products – Hot Rolled, Cold Rolled, Galvanized, Galvalume, Pre-painted Galvanised, Pre-painted Galvalume, TMT Rebars, Wire Rods and Special Steel Bars, Rounds and Blooms. Subject has manufacturing facilities at Toranagallu in Karnataka, Vasind and Tarapur in Maharashtra and Salem in Tamil Nadu.

By 2020, the Company aims to produce 34 million tons of steel annually with Greenfield integrated steel plants coming up in West Bengal and Jharkhand.

PRESS RELEASE

JSW STEEL COMPELLED TO SCALE DOWN PRODUCTION TO 30%

· JSW Steel plant at Vijaynagar is compelled to scale down production to 30% of its capacity due to abrupt stoppage of Iron ore ;

· Supply disruptions of Iron ore since July 2011 have been causing irrecoverable damage to steel industry in this region;

· Honorable Apex Court directive to provide 2.5 Million Ton per month Iron ore supply to steel industry by NMDC / from Stock piles is yet to be achieved

· Loss of Steel production in the region due to acute shortage of Iron ore will lead to 0.5% impact on India’s GDP, lower revenue to the exchequer (Rs.100000.000 MILLIONS) and loss of jobs to lakhs of people.

New Delhi, September 26: The country’s leading steel producer, JSW Steel has been compelled to scale down steel production to 30% from Saturday after the Honorable Apex Court’s order directing to sell Iron ore produced by NMDC through E-Auction by Monitoring Committee irrespective of Long Term Contracts. The abrupt disruption of supplies to JSW Steel (long term Customer) by NMDC cut the lifeline to run the furnaces in safe condition.

The Honorable Apex Court vide its order dated 29^th July 2011, concerned with rampant illegal mining ordered to suspend all mining activities in Bellary district of Karnataka. Thereafter, keeping in view the severe iron ore crunch being faced by the industry Honorable Apex Court has ordered to release 1 Million Ton per month Iron ore vide its order dated 5th August 2011 from NMDC mines and thereafter has ordered further release of 1.5 Million Ton per month by E-Auction through Monitoring Committee vide its order dated 2^nd September 2011 from already mined material.

The Honorable Apex Court’s directive on 5^th August 2011 to supply 1 Million Ton per month to steel industry by NMDC even after a lapse of 50 days is yet to be fulfilled. The steel industry in Karnataka region was very appreciative of the Apex court order of 2^nd September 2011, to release 1.5 Million Ton per month out of stock piles through E-Auction. This measure has not given any relief as 31% of the total auctioned material was not bought by any of the participants in the E-Auction due to improper pricing for low grade ore. Further, out of the balance 69% of the auctioned material, only 10% was dispatched to the industry till date due to several procedural delays. When there is scarcity of Iron ore to the steel industry, certain grades of Iron ore in the auction was bought at a higher price due to abnormal market conditions.

When the Steel industry in the region has not got the relief granted by the Apex court either from supplies from NMDC, or through release of ore from stock pile through E-Auction, adding NMDC production also through E-Auction by Monitoring Committee will stifle the Steel production further. And artificial scarcity of material may result in the prices of the raw material increasing to unnatural levels.

NMDC determines the price of Iron ore for long term customers in India following the finalization of long term prices with Japanese Steel Mills. The price for long term customers in India is being revised from time to time based on fluctuations in the Iron ore price in the international market. The low grade Iron ore is auctioned by NMDC in a transparent manner through MSTC, the same agency as recommended for E-Auction of Iron Ore in the Karnataka region approved by the Honorable Apex Court. Hence, NMDC sets the selling price of Iron ore on pan India basis and is applicable across all regions and customers. While all long term customers across India are procuring Iron ore from NMDC directly at the Long term price fixed by NMDC from time to time, sale of Iron ore from NMDC mines in Karnataka region through E-Auction will put the steel producers in Karnataka region at a disadvantage, even if supplies of required quantity and quality are available.

In these circumstances even continuing steel production at the current levels is very challenging unless Iron ore supply of required quality and quantity is restored expeditiously.

JSW Steel, as directed by Honorable Apex Court is representing to Central Empowered Committee and Monitoring Committee to ensure adequate supply of Iron ore at Fair Price to restore normal production as early as possible.

The Steel industry in the Karnataka region is contributing 0.5% to GDP, taxes over Rs.100000.000 millions to Exchequer and providing Employment to lakhs of people. If the steel production is not continuing with timely supply of Iron ore to these industries, the slowing Indian economy will be further burdened from loss of steel production in Karnataka region.

JSW STEEL POSTS 6.64 LAKH TONS CRUDE STEEL PRODUCTION - AUGUST’2011

JSW Steel Limited reported Crude Steel production of 6.64 lacs tons, with a growth of 23% for August’ 2011 compared to that of corresponding month in the last fiscal year. Higher production is mainly attributable to the commencement of 3.2 MTPA expansion project at Vijayanagar Works on 20^th July 2011

The break-up of production is as below:

Product	Production (Lakh Tons)
	Aug’11	Aug’10	Growth
Crude Steel	6.64	5.39	23%
Rolled Products : Flat	4.84	4.46	8%
Rolled Products : Long	1.25	0.87	44%

Consequent to suspension of mining and transportation of Iron ore in Bellary district by the Honourable Supreme Court of India vide its order dt. 29/07/2011, the Company had to cut its production due to shortage of Iron ore.

Since, the Honurable Supreme Court of India gave ruling on 05/08/2011 by allowing NMDC to mine to the extent of 1 million tons per month from 06/08/2011, the Company restored production to 80% of installed capacity. Subsequently, the extension of order dt. 29/07/2011 suspending the mining and transportation of Iron ore in Bellary district by the Honourable Supreme Court to the districts Chitradurga and Tumkur on 26/08/2011, further restricted Iron ore supplies to the Company impacting the steel production. Thus the Vijaynagar plant on an average operated at 75% of installed capacity in August 2011. The production in August 2011, would have been higher had the suspension and transportation of mining of Iron ore not been there.

Considering the hardship faced by the Steel Industry in the region, the Honourable Supreme Court of India, vide its order dt. 02/09/2011 accepted the recommendation of the Central Empowered Committee to release 1.5 Million tons of Iron ore per month to the Steel Industry in the region from the existing stock. As the supply of Iron ore from this stock is yet to resume, the crude steel production in September 2011 is severely impacted. This cut in production is expected to continue till the resumption of the Iron ore supplies from the e-auction by ‘Monitoring Committee’ in terms of Honourable Supreme Court order dt. 02/09/20111.

JSW Steel Limited, belonging to JSW group, part of the O P Jindal Group, is one of the lowest cost steel producers in the world. The group has diversified interest in mining, carbon steel, power, industrial gases, port facilities, Aluminium, Cement and Information Technology. JSW Steel Limited is engaged in manufacture of flat and long products viz. H R Coils, C R Coils, Galvanised products, Galvalume Products, auto grade / white goods grade CRCA Steel, Bars and Rods. Incorporated in 1994, it has grown to US $ 9 billion in little over fifteen years. JSW Steel Limited has the largest galvanizing and colour coating production capacity in the country and is the largest exporter of galvanized products with presence in over 100 countries across five continents.

CMT REPORT (Corruption, Money Laundering & Terrorism]

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

1] INFORMATION ON DESIGNATED PARTY

No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

2] Court Declaration :

No records exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

3] Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

4] Record on Financial Crime :

Charges or conviction registered against subject: None

5] Records on Violation of Anti-Corruption Laws :

Charges or investigation registered against subject: None

6] Records on Int’l Anti-Money Laundering Laws/Standards :

Charges or investigation registered against subject: None

7] Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

8] Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

9] Compensation Package :

Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

10] Press Report :

No press reports / filings exists on the subject.

CORPORATE GOVERNANCE

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

Our Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

CONTRAVENTION

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.48.93
UK Pound	1	Rs.76.52
Euro	1	Rs.66.65

SCORE & RATING EXPLANATIONS

SCORE FACTORS	RANGE	POINTS
HISTORY	1~10	6
PAID-UP CAPITAL	1~10	7
OPERATING SCALE	1~10	7
FINANCIAL CONDITION
--BUSINESS SCALE	1~10	8
--PROFITABILIRY	1~10	8
--LIQUIDITY	1~10	8
--LEVERAGE	1~10	7
--RESERVES	1~10	8
--CREDIT LINES	1~10	7
--MARGINS	-5~5	--
DEMERIT POINTS
--BANK CHARGES	YES/NO	YES
--LITIGATION	YES/NO	NO
--OTHER ADVERSE INFORMATION	YES/NO	NO
MERIT POINTS
--SOLE DISTRIBUTORSHIP	YES/NO	NO
--EXPORT ACTIVITIES	YES/NO	YES
--AFFILIATION	YES/NO	YES
--LISTED	YES/NO	YES
--OTHER MERIT FACTORS	YES/NO	YES
TOTAL		66

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
-	NB	New Business	-

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.