Tata-Steel-Ir-2018-19-220619.Pdf
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Integrated Report & Annual Accounts 2018–19 112th Year Contents STRATEGIC REPORT Our Leadership Our Business Our Strategy Our Capitals 1 WeAlsoMakeTomorrow 14 Organisational Overview 24 Strategy 40 Our Capitals 3 Year at a Glance 16 Products and Markets 28 Stakeholder Engagement 42 Financial Capital 4 Board of Directors 18 Approach to Value Creation 30 Material Issues 46 Manufactured Capital 6 From the Chairman’s Desk 20 Business Model 32 Risks and Opportunities 52 Intellectual Capital 8 Management Speak 36 Corporate Governance 58 Human Capital 68 Natural Capital STATUTORY REPORTS FINANCIAL STATEMENTS 76 Social and Relationship Capital 90 Board’s Report 195 Financial Highlights 88 Awards and Recognitions 109 Annexures 199 Standalone 293 Consolidated 419 Notice ABOUT THIS REPORT Our Approach to Reporting Scope and Boundary Forward Looking Statements This is the fourth Integrated Report of Tata Steel Limited This Report covers information on Tata Steel, including Certain statements in this report regarding our business (Tata Steel). Our Integrated Report provides quantitative the Tata Steel plants (at Jamshedpur, Jharkhand and operations may constitute forward-looking statements. and qualitative disclosures on our relationships with Kalinganagar, Odisha), Raw Materials Division, and Profit These include all statements other than statements of the stakeholders and how our leadership, culture and Centers. historical fact, including those regarding the financial strategy are aligned to deliver value while managing risks position, business strategy, management plans and and changes to the external environment. Our Report Approach to Materiality objectives for future operations. continues to evolve towards enhanced disclosures The Report presents an overview of our business and to meet the requirements of our investors and other associated activities that help in long-term value creation. Forward-looking statements can be identified by words stakeholders. Report content and presentation is based on material such as ‘believes’, ‘estimates’, ‘anticipates’, ‘expects’, issues to Tata Steel and its stakeholders. Material issues ‘intends’, ‘may’, ‘will’, ‘plans’, ‘outlook’ and other words Reporting Principle are gathered from multiple channels and forums of of similar meaning in connection with a discussion of The financial and statutory data presented in this Report engagement across the organisation and from external future operational or financial performance. is in line with the requirements of the Companies Act, stakeholders. In Finanacial Year 2018-19, Tata Steel Forward-looking statements are necessarily dependent 2013 (including the rules made thereunder), Indian updated its Environmental, Social and Governance (ESG) on assumptions, data or methods that may be Accounting Standards, the Securities and Exchange material issues and incorporated them in its long- incorrect or imprecise and that may be incapable of Board of India (Listing Obligations and Disclosure term plans. being realised, and as such, are not intended to be a Requirements) Regulations, 2015 and the Secretarial guarantee of future results, but constitute our current Standards. The Report is prepared in accordance with Management Responsibility expectations based on reasonable assumptions. Actual the framework of the International Integrated Reporting To optimise governance oversight, risk management and results could differ materially from those projected in Council (IIRC) and discloses performance against the Key controls, the contents of this Report have been reviewed any forward-looking statements due to various events, Performance Indicators (KPIs) relevant to Tata Steel, as by the senior executives of the Company, including the risks, uncertainties and other factors. We neither assume per the Global Reporting Initiative (GRI), the Securities Chief Executive Officer and Managing Director, Executive any obligation nor intend to update or revise any and Exchange Board of India (SEBI) and World Steel Director and Chief Financial Officer, Vice President Safety, forward-looking statements, whether as a result of new Association (worldsteel). Health & Sustainability and Company Secretary & Chief information, future events or otherwise. Legal Officer (Corporate & Compliance). Reporting Period The information is reported for the period April 1, 2018 to Independent Assurance March 31, 2019. For KPIs, comparative figures for the last Assurance on financial statements has been provided by three to five years have been incorporated in the Report independent auditors Price Waterhouse & Co. Chartered to provide a holistic view to our stakeholders. Accountants LLP and non-financial statements by KPMG. The certificate issued by KPMG is available on our website at www.tatasteel.com or can be accessed at https://bit.ly/2WQGHe8. The steel we produce is used in making iconic structures, smarter FY 2018-19 cities, and cleaner and safer automotive solutions. We are Highlights exploring uncharted territories in (Consolidated) new technologies and materials to develop new businesses and value-added products while 26.80 MnT acting responsibly to ensure a Deliveries long-lasting positive impact on the society and environment. www.wealsomaketomorrow.com `1,57,669 Cr. Turnover `29,770 Cr. EBITDA `9,098 Cr. Profit After Tax (PAT) Our steel has gone into the making of futuristic structures and buildings across the globe. Taipei 101, Taipei, Taiwan The London Eye, London Marina Bay Sands, Singapore Bogibeel Bridge, Assam, India Kempegowda International Airport, Bengaluru, India 2 INTEGRATED REPORT & ANNUAL ACCOUNTS 2018-19 | 112TH YEAR YEAR AT A GLANCE* Achievements of today for a brighter tomorrow Turnover EBITDA Margin Profit After Tax (PAT) ₹70,611 Cr. 29% ₹10,533 Cr. CAPEX Crude Steel Production Total Sales ₹3,677 Cr. 13.23 MnT 12.7 MnT Enriched/Value-added Products Revenue from By-products Savings through Shikhar25 8.6 MnT ₹3,426 Cr. ₹2,801 Cr. GHG Emissions Intensity Lost Time Injury Frequency Rate (LTIFR) Customer Satisfaction Index (Steel) (Out of 100) 2.34 tCO e/tcs 0.29 2 81.6 Solid Waste Utilisation Specific Water Consumption CSR Outreach 99% 3.5 m3/tcs >1.1 million * All figures are on a Standalone basis as on March 31, 2019 Ownership Principal activities structure and revenue streams 50.30% 16.58% 93.7% 5.7% Institutions Retail Shareholders Steel Value Chain Raw Materials Value Chain 33.12% Promoter and Promoter Group 0.6% Other Businesses Tata Steel acquires Tata Steel group acquires Bhushan Steel Usha Martin Steel Business During Financial Year 2018-19, Tata Steel acquired Bhushan Tata Steel group acquired the steel business of Usha Martin Limited Steel Limited. This acquisition has significantly added to our through one of its subsidiaries. This move helps the Company to steel business and helped expand our footprint in India. create a globally competitive long products business focussed on value-added and differentiated products while achieving cost competitiveness. 3 BOARD OF DIRECTORS (As on April 25, 2019) Guiding the path to tomorrow Mr. Ratan N. Tata Chairman Emeritus BOARD COMMITTEES Standing (Left to Right) 1. Audit T. V. Narendran V. K. Sharma Peter Blauwhoff 2. Nomination and Remuneration Chief Executive Officer and Non-Executive Director Independent Director 3. Corporate Social Responsibility Managing Director and Sustainability 3 4 5 6 5 6 1 4 6 4. Risk Management 5. Stakeholders' Relationship Sitting (Left to Right) 6. Safety, Health and Environment Aman Mehta N. Chandrasekaran Member Chairperson Independent Director Chairman of the Board and Parvatheesam K Non-Executive Director Company Secretary & Chief Legal Officer 1 4 2 (Corporate & Compliance) 4 INTEGRATED REPORT & ANNUAL ACCOUNTS 2018-19 | 112TH YEAR STRATEGIC REPORT | 1-88 STATUTORY REPORTS | 89-194 FINANCIAL STATEMENTS | 195-418 Deepak Kapoor Saurabh Agrawal Koushik Chatterjee Independent Director Non-Executive Director Executive Director and Chief Financial Officer 1 3 5 1 4 3 4 5 Mallika Srinivasan O. P. Bhatt Independent Director Independent Director 2 6 1 2 3 5 FROM THE CHAIRMAN’S DESK Well positioned to capitalise on opportunities Dear Stakeholders, It is a privilege to write to you as the Chairman of the Board of Tata Steel. Financial Year 2018-19 was a good year for your Company, wherein your Company executed well on its strategic roadmap and delivered a strong financial performance. Last year in my communication to you, I shared with you the Company’s strategy to leverage the growth potential of the Indian economy by pursuing both organic and inorganic growth opportunities. I am happy to share with you that your Company has made significant progress in this regard. Your Company undertook the following tangible steps to strengthen and expand the India operations. 6 INTEGRATED REPORT & ANNUAL ACCOUNTS 2018-19 | 112TH YEAR STRATEGIC REPORT | 1-88 STATUTORY REPORTS | 89-194 FINANCIAL STATEMENTS | 195-418 Financial Year 2018-19 was a good year for your Company, wherein your Company executed well on its strategic roadmap and delivered a strong financial performance. Your Company successfully completed On a consolidated basis, your Company demand for industries such as steel. India the acquisition of Bhushan Steel (now achieved the highest ever levels of revenues also has a large natural resource base and named Tata Steel BSL) under the Insolvency and EBITDA this year. I am happy to report skilled manpower to be one of the most and Bankruptcy Code process. This was that the Company has generated