The Directors take pleasure in presenting the eighteenth Annual Report
 of your Company, together with the Standalone and Consolidated Audited
 Statement of Financial Accounts for the year ended March 31, 2012.
 
 1.  FINANCIAL RESULTS
 
                                                       (Rs. in crores)
 
 Particulars                                          Standalone
 
                                                  F. Y.         F.Y.
                                                 2011-12      2010-11
 
 Gross Turnover                                34,658.48    25,092.09
 
 Less : Excise duty                             2,598.01     1,967.52
 
 Net Turnover                                  32,060.47    23,124.57
 
 Add: Other Operating Revenues                     62.19       242.54
 
 Revenue from operations                       32,122.66    23,367.11
 
 Operating EBIDTA                               5,630.80     4,776.90
 
 Add: Other Income                                179.30       234.51
 
 Less: Finance costs                            1,186.41       854.17
 
 Less: Depreciation and amortization            1,708.17     1,378.71
 
 Profit before Exceptional Items and Tax        2,915.52     2,778.53
 
 Less: Exceptional Items                          820.96            -
 
 Profit before Tax (PBT)                        2,094.56     2,778.53
 
 Less: Tax expense                                468.70       767.86
 
 Profit after Taxation but before minority 
 interests and share of                         1,625.86     2,010.67
 profits/loss of Associates
 
 Less: Share of Profit / (Losses) of Minority
 
 Add: Share of (Losses) / Profit from 
 Associates (net)
 
 Excluding exceptional items
 
 Exceptional items
 
 Profit for the year (PAT)                      1,625.86    2,010.67
 
 Add: Balance in profit and loss account        2,788.36    5,327.78
 
 Amount available for Appropriation             4,414.22    7,338.45
 Less: Appropriations:
 
 Transfer from Debenture Redemption Reserve       125.00
 
 Dividend on Preference Shares                    (27.90)     (27.90)
 
 Proposed Final Dividend on Equity Shares        (167.34)    (273.32)
 
 Corporate Dividend Tax                           (31.68)     (48.87)
 
 Transfer to General Reserve                   (2,325.00)  (4,200.00)
 
 Closing balance                                1,987.30    2,788.36
 
 2.  FINANCIAL HIGHLIGHTS
 
 (A) Standalone Results
 
 The year under review was challenging due to non-availability of Iron
 ore caused by imposition of ban on Iron ore mining by the Honourable
 Supreme Court of India in the State of Karnataka. Inspite of this
 constraint the Company achieved a volume growth over previous year of
 16% in crude steel production during the current year. It had achieved
 crude steel production of 7.429 million tonnes and volume of sales of
 7.815 million tonnes. The growth in volumes could be achieved due to
 commissioning of the 3.2 mtpa Crude Steel Expansion Project at
 Vijayanagar Works in Q2 of 2011-12 enhancing the Crude Steel
 manufacturing capacity to 10 mtpa. The overall steel manufacturing
 capacity of the Company Stood at 11 mtpa. With the completion of this
 expansion project, the Company has scaled new heights as a leading
 player in the steel industry in the country. The Expansion facilities
 stabilized quickly and achieved hot metal production of 1.135 million
 tonnes during the current year, which worked out to around 72% of the
 Installed capacity.
 
 The Gross Turnover and Net Turnover for the year stood at Rs. 34,658
 crores and Rs. 32,060 crores, respectively, showing a growth of 38% and
 39% over the previous year mainly driven by growth in volumes.
 
 The operating EBIDTA for the year was Rs. 5,631 crores and operating
 EBIDTA margin for the year was 17.53%. Your Company posted PAT of Rs.
 1,626 crores after considering exceptional item (Foreign exchange loss)
 of Rs. 821 crores. Due to the unusual depreciation in the value of the
 Rupee against US Dollar during the previous fi scal, the net loss of Rs.
 821 crores on restatement of foreign currency monetary items at close
 of the year has been considered by the Company to be exceptional in
 nature.
 
 In view of the rulings viz permitting National Mineral Development
 Corporation (NMDC) to mine 1 million tonne per month to be supplied to
 steel industry and sale of around 25 million tonnes of Iron ore stock
 pile through E-Auction, the Company could operate the plant at about
 80% capacity in the year under review.  Had the constraints of Iron ore
 supply not been there, the performance could have been much higher.
 
 (B) Consolidated Results
 
 As per the Consolidated Financial Statements, the Gross Turnover, Net
 Turnover, operating EBIDTA and PAT of the Company are Rs. 36,720 crores,
 Rs. 34,124 crores, Rs. 6,102 crores and Rs. 538 crores, respectively.
 
 In accordance with the Accounting Standards AS-21, on Consolidated
 Financial Statements read with Accounting Standard AS-23 on Accounting
 for Investment in Associates and AS-27 on Financial Reporting of
 Investment in Joint Ventures, the audited Consolidated Financial
 Statements are provided in the Annual Report.
 
 3.  DIVIDEND
 
 The Board has, subject to the approval of the Members at the ensuing
 Annual General Meeting, recommended dividend at the stipulated rate of
 Rs.1.00 per share on the 27,90,34,907, 10% Cumulative Redeemable
 Preference Shares of Rs.10 each of the Company, for the year ended March
 31, 2012.
 
 The Board has also, considering the Company''s performance and financial 
 position for the year under review, recommended a dividend of Rs.
 7.50 (75%) per fully paid-up Equity Share of Rs.10 each of the Company,
 for the year ended March 31, 2012, subject to the approval of the
 Members at the ensuing Annual General Meeting.
 
 Together with Corporate Tax on dividend, the total outflow on account
 of equity dividend will be Rs. 194.49 crores, vis-à-vis Rs. 317.66 crores
 paid for fiscal 2010-11.
 
 4.  PROSPECTS
 
 Indian GDP is estimated at 7.6% in FY 2012-13 as per Prime Minister''s
 Economic Advisory Council (PMEAC). Indian steel demand is also expected
 to track GDP growth supported by easing interest rate cycle and
 resultant revival in infrastructure, construction, industrial and
 manufacturing sectors.  Prediction of good monsoon in the current year,
 declining commodity prices globally, lower interest rates are positives
 to spur economic activity in the country. Notwithstanding, fragile
 recovery in US, Sovereign debt crisis in Europe and slow down in China,
 domestic demand/consumption is one of the primary drivers of Indian
 Economy, to be optimistic to show a GDP growth of above 7%. The Company
 expects opening of category ''A'' Iron ore mines in the near future
 followed by category ''B'' mines improving the availability of Iron ore
 and consequently improve performance of the company.
 
 5.  PROJECTS AND EXPANSION PLANS
 
 The progress made on various projects were as follows:
 
 Vijayanagar Works
 
 (a) Projects commissioned during FY 2011-12
 
 The 3.2 mtpa expansion project at Vijayanagar works was completed and
 commissioned during the last financial year.
 
 Other projects completed during the year include:
 
 - 4.2 mtpa - Pellet Plant 2.
 
 - 300 MW - Captive Power Plant (CPP 4).
 
 (b) Projects under progress
 
 - 2.3 mtpa – Cold Rolling Mill Complex, being executed in two phases,
 the first phase is expected to be commissioned in FY 2013-14 and
 second phase in FY 2014-15.
 
 - 2nd Phase (1.5 mtpa) of New Hot Strip Mill, taking the rolling
 capacity to 5 mtpa by September 2012.
 
 - 2nd Phase of Beneficiation Plant 2, taking total capacity to 20 mtpa
 by FY 2012-13 in phased manner.
 
 (c) Projects proposed
 
 - The Company has assessed the existing facilities at Vijayanagar works
 and started working on increasing plant capacity from 10 mtpa to 12
 mtpa. Total project cost is about Rs. 2,695 crores The project is
 expected to be commissioned in FY 2013-14.
 
 Salem Works
 
 (a) Projects commissioned during F.Y. 2011-12
 
 - Blooming mill phase 2 commissioned in June 2011, taking the total
 capacity to 0.5 mtpa. Ramping up of production is under progress.
 
 (b) Projects under progress
 
 - Installation of reducing and sizing block for capacity and quality
 enhancement of bar and rod Mill. Expected to be commissioned in Mar 13.
 
 - Automatic inspection for blooming mill products to cater to reputed
 customers.  Expected to be commissioned in Feb 13.
 
 Vasind Works
 
 (a) Projects commissioned during FY 2011-12
 
 - Natural Gas pipeline project (completed during Feb, 2012)
 
 Gas pipe line of 7.6 km was laid down along the National Highway,
 replacing use of natural gas in lieu of LPG/Furnace oil.
 
 (b) Projects under progress
 
 - Colour Coating Line Project
 
 Two colour coating line with an aggregate capacity of 0.225 mtpa are in
 progress and to be commissioned in FY 2012-13.
 
 Tarapur Works
 
 Upcoming Projects in 2012-13
 
 - Upgradation of Cold Rolling Mill (TM1) to enhance production capacity
 from 0.05 mtpa to 0.225 mtpa.
 
 - New Galvanizing Line (CSD5) with dual products of Galvanised and
 Galvalume Steel with an annual capacity of 0.2 mtpa.
 
 - Upgradation of Cold Rolling Mill (TM2) to enhance production capacity
 from 0.06 mtpa to 0.1 mtpa.
 
 - Upgradation of Colour Coating Lines (CCL-1 & CCL-2) to enhance
 production capacity from 0.180 mtpa to 0.276 mtpa.
 
 6.  SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES
 
 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.
 
 Details of major Subsidiaries, Joint Venture and Associate Companies
 are given below:
 
 A.  Indian subsidiaries
 
 1. JSW Bengal Steel Limited (JSW Bengal), its Subsidiaries Barbil
 Beneficiation Company Limited, JSW Natural Resources India Limited and
 JSW Energy (Bengal) Limited (JSWEBL)
 
 JSW Bengal Steel Limited achieved good progress in connection with
 setting up an integrated steel plant in the State of West Bengal. While
 33 Kms boundary wall work was completed over 4300 acres of land at
 Salboni, JSWBSL commenced construction of residential complex named
 Ankur for employees to be accommodated during plant construction and
 operation. All major survey work has already been completed at the
 site. Power as well as water for construction are available at the
 site.  A reputed Canadian and Chinese joint venture company, M/s.
 HATCH-CISDI International is preparing basic design and plant layout
 for a 10 mtpa integrated steel plant along with a 1,620 mw power plant
 at Salboni. The Company already received 75 mgd water allocation letter
 for sourcing water from Rupnarayana river and the route for laying a
 water pipeline has also been fi nalised. The work of ROW for the
 proposed 68 Kms water pipeline is in progress.
 
 The drilling as well as three dimensional High Resolution Seismic
 Survey (3 DHRSS) have been successfully completed at Kulti-Sitarampur
 coal block by JSW Natural Resources India Ltd. In line with the MoEF
 clearance that has already been received for the steel plant, it is
 proposed to implement the project in phases, subject to satisfactory
 tie up of iron ore, to enable financial closure and approval of MoEF
 for mining activities.
 
 Target date for start of first phase of commercial production in
 Bengal projects is FY 2015-16.
 
 2.  JSW Jharkhand Steel Limited
 
 JSW Jharkhand Steel Limited was incorporated to set up a steel plant in
 the State of Jharkhand.  The Company is pursuing to obtain various
 approvals/clearances for raw material linkages, land acquisition,
 environmental clearances, among others, for this project.
 
 3.  JSW Steel Processing Centres Limited (JSWSPCL)
 
 JSW Steel Processing Centres Limited (JSWSPCL) is a 100% subsidiary of
 the Company. JSWSPCL was set up as a Steel Service Centre comprising
 HR/CR Slitter and cut to length facility with an annual slitting
 capacity of 5,00,000 tonnes. The Company processed 4,99,218 tonnes of
 steel during the FY 2011-12, as compared to 4,97,112 tonnes in the
 previous year.
 
 During the previous year, JSWSPCL purchased three Slitting Lines and
 one Multi Strand Blanking lines from its fellow subsidiary JSW Steel
 Service Centre (UK) Limited. Out of which, the Company is in the
 process of commissioning one slitting line and identifying a suitable
 location to commission the remaining equipment.
 
 4.  Amba River Coke Limited (ARCL)
 
 The Company has acquired 100% holding in ARCL to set up a 1 mtpa Coke
 oven to be supplied to JSW Ispat Steel Ltd. (JISL) under long term take
 or pay contract with return on equity of 25% to the Company. These
 projects are expected to be commissioned by March 2014.
 
 It is also proposed to set up a 4 mtpa pellet plant in ARCL at an
 estimated project cost of Rs. 835 crores on similar terms as that of
 coke oven project. These projects will be taken up for implementation
 on receipt of requisite clearance and commissioned in 30 months.
 
 B.  Overseas Subsidiaries
 
 1.  JSW Steel (Netherlands) B.V. (JSW Netherlands)
 
 JSW Netherlands is a holding Company for USA, UK, Chile and Kanya based
 subsidiaries. It also has 49% equity holding of Georgia-based Geo Steel
 LLC, incorporated under the laws of Georgia. The Company also invested
 in the plate and pipe mill in the US, coal mining assets in the US,
 iron ore mining concessions in Chile and fixed assets at UK through
 the following step down subsidiaries.
 
 (a) JSW Steel Holding (USA) Inc. and its subsidiaries viz.  JSW Steel
 (USA) Inc – Plate and Pipe Mill Operation and Periama Holdings LLC and
 its subsidiaries – West Virginia, USA based Coal Mining Operation.
 
 Plate and Pipe Mill operation
 
 During FY 2011-12, the Plate and Pipe Mill performance in the US has
 improved significantly as compared to that during previous year,
 mainly due to improvement in economic scenario, resulting in better
 capacity utilisation. In 2011- 12, the 3,31,763 net tones of plates and
 66,168 net tones of pipes were produced with capacity utilisation of
 33% and 12% respectively.
 
 The Subsidiary Company undertook various debottlenecking and corrective
 measures in the production process, due to which it is expected that US
 operations would show improved performance.
 
 Coal mining operation
 
 JSW Steel Holding (USA) Inc. has 100% equity interest in coal mining
 concessions and barge load out facility in USA.
 
 While some of the mines are currently operational, statutory
 clearance/permits for other mines are in advanced stage of approval.
 
 It is expected to produce around 0.50 million tonnes of coal in the
 next financial year subject to approvals.
 
 (b) JSW Panama Holdings Corporation and Chilean subsidiaries namely
 Inversiones Eurosh Limitada (IEL), Santa Fe Mining (SFM) and Santa Fe
 Puerto S.A (SFP)
 
 During FY 2011-12, contract mining activity with a capacity of 1mtpa
 through dry process route was undertaken. The Company shipped twelve
 shipments of iron ore concentrate aggregating to 0.6 million tonnes. It
 is expected to produce around 1 million tonnes of iron ore concentrate
 in the next financial year.
 
 Work on establishing a wet beneficiation plant is currently being
 pursued and necessary statutory and environmental approvals are
 awaited.
 
 SFP, a subsidiary of SFM received maritime concession in April 2011 to
 develop a cape size port in North Caldera. The environmental and other
 regulatory approvals have been applied for and are being pursued with
 Authorities Concerned.
 
 (c) JSW Steel East Africa Limited (JSWSEAL)
 
 JSWSEAL was formed with the object of exploring mineral resources
 (manganese, iron ore and coal) and developing them to export in
 value-added form.
 
 JSW Steel Netherlands BV holds 99% stake in JSWSEAL and JSW Steel (UK)
 Ltd holds the balance stake of 1%.
 
 JSWSEAL, signed MOU on January 11, 2012 for exploration of manganese
 ore with Government of Kenya. The agreement gives it the right to
 explore manganese ore in the Coastal Province of Kenya (around 22,000
 sq. km.).
 
 2. JSW Natural Resources Limited (JSWNRL) and its subsidiaries JSW
 Natural Resources Mozambique Lda (JSWNRML), JSW ADMS Carvao Lda
 
 JSW Natural Resources Limited was incorporated in Mauritius to acquire
 coal assets/other assets relating to the steel business.
 
 JSW Natural Resources Limited formed a wholly- owned subsidiary – JSW
 Natural Resources Mozambique Lda in Mozambique to acquire coal assets
 and engage in prospecting and exploring coal, iron ore and manganese.
 
 JSW Natural Resources Mozambique Lda incorporated JSW ADMS Carvão Lda
 on October 8, 2010 wherein 85% stake is owned by JSWNRML. It has a
 mining licence in Zumbo District Tete Province. The Company initiated
 drilling exploration activities in this area.
 
 C.  Joint Venture Companies
 
 1.  Geo Steel LLC
 
 Georgia-based Joint Venture Geo Steel LLC, in which your Company holds
 49% equity through JSW Steel (Netherlands) B.V. set up a steel rolling
 mill in Georgia with a production capacity of 175,000 tonnes in
 Georgia. Geo Steel produced 113453 tonnes of rebars and 117818 tonnes
 of billets during 2011-12. The net turnover was USD 79.43 million.
 
 2.  Rohne Coal Company Private Limited
 
 Your Company holds 49% equity in Rohne Coal Company Pvt. Ltd. (JSW
 Group holds 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 are being pursued
 with government authorities.
 
 3.  MJSJ Coal Limited
 
 In terms of the Joint Venture Agreement to develop Utkal – A Gopal
 Prasad (West) thermal coal block in Odisha, your Company agreed to
 participate in the 11% equity of MJSJ Coal Limited, Odisha along with
 four other partners.  The Government of India has allotted 1,520 acres
 of Gopal Prasad west area to MJSJ Coal Limited. Mahanadi Coalfi elds
 Ltd, a public sector company holds 60% of the equity.
 
 4.  Gourangdih Coal Limited
 
 Gourangdih Coal Ltd (GCL) is a 50:50 Joint venture between JSW Steel
 Limited and Himachal EMTA Power Corporation Ltd (HEPL) incorporated to
 develop and mine coal from Gourangdih, ABC thermal coal block in West
 Bengal. It is currently working on pre-mining activities. A mining plan
 was submitted to government authorities and is under consideration.
 
 5.  Toshiba JSW Turbine and Generator Private Limited
 
 Toshiba JSW Turbine & Generator Pvt. Ltd is a Joint Venture with a
 shareholding of 75% by Toshiba Corporation Ltd., Japan, 21.33% by JSW
 Energy Ltd. and 3.67% by the Company, to design, manufacture, market
 and maintain services of mid to large-size supercritical steam turbines
 and generators of size 500 MW to 1000 MW.
 
 The main plan was inaugurated for operation in February 2012.
 
 6.  Vijayanagar Minerals Private Limited (VMPL)
 
 During 2011-12, VMPL supplied 0.66 million tonnes of iron ore from
 Thimmappanagudi Iron Ore Mines (TIOM), vis-à-vis 2.2 million tonnes in
 the last FY 2010-11.
 
 As per the Honourable Supreme Court''s directive to stop all iron ore
 mining operations in Karnataka, mining activity of TIOM mines operated
 by VMPL has been stopped since July 29, 2011. VMPL''s operations and 
 financial results were affected due to the above reasons.
 
 7.  JSW Severfield Structures Limited and its subsidiary JSW
 Structural Metal Decking Limited
 
 JSW Severfield Structures Ltd (JSSL) set up a Greenfield project to
 design, fabricate and erect structural steelwork and ancillaries,
 including decking for construction projects with a total plant capacity
 of 35,000 tpa at Bellary in Karnataka. The Company produced a total of
 20,384 tonnes during the year. The Company''s order book stood at Rs. 178
 crores (33,916 tonnes) as on March 31, 2012.
 
 JSW Structural Metal Decking Limited (JSWSMD), a subsidiary company of
 JSSL is engaged in the business of designing, roll forming and
 installation of structural metal decking and ancillaries, including
 shear connectors, for construction projects with a total plant capacity
 of 10,000 tpa at Bellary in Karnataka. It started its commercial
 production in October 2010. The Company has orders of around 1,33,914
 square meters.
 
 8.  JSW MI Steel Service Center Private Limited (MISI JV)
 
 JSW Steel and Marubeni-Itochu Steel signed a Joint Venture Agreement on
 September 23, 2011 to set up Steel Service Centers in India.
 
 The JV Company, JSW MI Steel Service Center Pvt Ltd, proposes to set-up
 its first Steel Service Center in North India (NCR) with an initial
 installed capacity of 180,000 tpa (Phase-I) which will subsequently be
 enhanced to 500,000 tpa.  The estimated project cost for Phase-I is
 pegged at Rs. 122 crores and the estimated completion time is 12 months
 from date of completion of land acquisition.
 
 The service centre will be equiped to process fl at products such as
 hot rolled and coated products with a view to offer just in time
 solutions to the automative, white goods, construction and other value
 added segments.
 
 D.  Associate Companies
 
 1.  Jindal Praxair Oxygen Company Private Limited (JPOCPL)
 
 The oxygen plants of JPOCPL have been working satisfactorily primarily
 to meet the requirements of steel plant operations at Vijayanagar
 Works.  During 2011-12, the combined production of the oxygen plant
 module #1 and module # 2 of JPOCPL was: gaseous oxygen – 836 million
 Nm3; gaseous nitrogen – 275 million Nm3; Liquid oxygen – 25 million
 Nm3; Liquid nitrogen – 23 million Nm3 and Argon – 10 million Nm3.
 
 2.  JSW Ispat Steel Limited (JISL)
 
 As approved by its members, the name of the Company was changed from
 Ispat Industries Limited to ''JSW Ispat Steel Limited'' w.e.f.
 28.06.2011.
 
 During the year under review, the Company produced 2.39 million tonnes
 of HR coils and capacity utilisation achieved was 73%. The sales volume
 was 2.75 million tonnes with EBITDA of Rs. 1,126 crores. The Net Loss for
 the corresponding periods after considering Exceptional items was Rs.
 1,930 crores.
 
 The Board of Directors has taken note of the matters to which the
 Auditors of JISL has drawn attention in their report, regarding overdue
 trade receivables amounting to Rs. 255.61 crores.  The Board of Directors
 have also taken note that the management of JISL is confident of
 recovery and relying on this, no provisioning has been considered
 necessary by the Board in respect of this item.
 
 7.  CREDIT RATING
 
 The credit rating for the long-term debt/ facilities / NCDs of your
 Company continues to be AA by credit rating agency Credit Analysis &
 Research Ltd. (CARE). The short-term debt/ facilities continue to be
 rated at the highest level of A1  by CARE.
 
 The long-term rating was placed under credit watch in view of the ban
 imposed on iron ore mining in Karnataka by the Honourable Supreme
 Court.
 
 The rating continues to derive strength from your Company''s significant 
 presence in the steel sector, management capability and well- diversified 
 mix of value-added products.
 
 AA rating by CARE indicates a high safety for timely servicing of
 debt obligations and lowest credit risk.
 
 A1  rating is the highest rating in the category and indicates a
 strong capacity for timely payment of short-term debt obligations and
 lowest credit risk.
 
 8.  FIXED DEPOSITS
 
 Your Company has not accepted any fixed deposits from the public and
 is therefore not required to furnish information in respect of
 outstanding deposits under Non-Banking Non- Financial Companies
 (Reserve Bank) Directions, 1966 and Companies (Acceptance of Deposits)
 Rules, 1975.
 
 9.  SHARE CAPITAL
 
 There was no change in the share capital of the Company during the 
 financial year under review.
 
 At the end of 2011-12, your Company''s paid up equity share capital
 remained at Rs. 2,23,11,72,000 (comprising of 22,31,17,200 equity shares
 of Rs. 10 each).
 
 10.  WARRANTS ISSUED ON A PREFERENTIAL BASIS
 
 Pursuant to the decisions taken in the Board meeting held on May 03,
 2010 and the Extra Ordinary General Meeting held on June 02, 2010, the
 Share Allotment Committee of Directors of the Company, in its meeting
 held on June 16, 2010, had allotted 1,75,00,000 (One crore seventy five 
 lakhs) Warrants on a preferential basis, to a Promoter Group Entity.
 
 As per the terms of issue of these warrants, upon payment of Exercise
 Price of Rs.1,210 per warrant, as reduced by the 25% upfront money paid
 at the time of allotment of warrants, the warrant holder was entitled
 to apply for and obtain allotment of one equity share of Rs.10 each
 against each warrant held. The last date for the exercise of the
 conversion right of the Warrant holder was December 15, 2011 (within 18
 months from the date of their allotment).
 
 As the Warrant Holder (Promoter Group Entity) did not exercise its
 option to convert the aforesaid 1,75,00,000 warrants allotted to it
 into equity shares of the Company, the amount of Rs.529,37,50,000 being
 the initial 25% of the total consideration of Rs.2117,50,00,000 received
 by the Company has been forfeited.
 
 11.  TECHNICAL COLLABORATION WITH JFE STEEL CORPORATION, JAPAN
 
 Pursuant to the execution of several definitive technical
 collaboration agreements on July 27, 2010 between the Company and JFE
 Steel Corporation (JFE), one of the largest integrated steel
 manufacturers in Japan, for the supply of certain technology and the
 provision of certain technical assistance to the Company, including
 foreign collaboration agreements, technical assistance agreement for
 automotive steel and general technical assistance agreement for plant
 performance improvement, JFE continues to be a foreign collaborator of
 the Company.
 
 The collaboration helps the Company to achieve operational excellence
 and also move up in the value chain with access to cutting-edge
 technology.
 
 The Company plans to set up an electrical steel manufacturing facility
 of 0.6 mtpa capacity at its integrated steel works at Vijayanagar.
 Initially, this facility will produce 0.4-0.5 mtpa of Cold Rolled
 Non-grain Oriented (CRNO) grade electrical steel.
 
 The Company will also produce Cold Rolled Grain Oriented (CRGO) grade
 in the future.  Implemented in a phased manner, your Company envisages
 becoming the largest electrical steel producer in the country. This
 will be taken up on finalisation of terms of technical collaboration
 arrangement.
 
 12.  IRON ORE STATUS
 
 In 2011, the Honourable Supreme Court banned iron ore mining in
 Bellary, Chitradurga and Tumkur districts of Karnataka citing
 environmental violations, and asked the Central Empowered Committee
 (CEC) to carry out an environmental impact assessment.
 
 Following the ban, the Honourable Supreme Court of India on 29th July
 2011, based on the representation made by the Steel Industry in
 Karnataka, gave the following relief:
 
 i. By permitting the National Mineral Development Corporation (NMDC) to
 mine 1 million tonne Iron Ore per month to be made available to the
 Steel Companies through E.auction.
 
 ii. By permitting to E.auction 1.5 million tonnes of Iron Ore per month
 from the total stock pile of 25 million tonnes lying with various
 mining companies.
 
 Eventhough the E.auction commenced on 14th September 2011, there were
 several procedural, logistics and pricing constraints due to which the
 Steel Companies could not get supply of Iron Ore in adequate
 quantities.
 
 The Honourable Supreme court, Central Empowered Committee (CEC),
 Monitoring Committee and State Government took several steps to
 smoothen the process of E-Auction and quick dispatch of auction
 material.
 
 After taking into account the Iron Ore auctioned and yet to be
 received, balance Iron Ore to be auctioned from stock piles & supplies
 from NMDC, Vijayanagar unit''s requirement can be met for 2 to 3 months.
 It is therefore essential that the Hon''ble Supreme Court lifts the ban
 on Iron Ore Mines in the Karnataka region to ensure additional supplies
 of Iron Ore for continuation of steel production in the region.
 
 Subsequently, in April 2012 on recommendation of CEC, the Supreme Court
 allowed the resumption of mining in Category ''A'' mines subject to
 certain conditions. It is expected that some of the category ''A'' mines
 may resume mining operations in the month of Jul / Aug 2012.
 
 It is expected that category ''B'' mines will also be permitted to resume
 mining in line with CEC recommendations during the course of current 
 financial year.
 
 The CEC has further recommended cancellation of Category ''C'' mines and
 auction them based on a scheme to be presented by State Government and
 to be approved by Apex Court.  The Company will have an opportunity to
 participate in the bidding to get some of these mines.
 
 13.  SEARCH & SEIZURE OPERATIONS BY INCOME TAX AUTHORITIES
 
 Further to the Search & Seizure operations by the Income-tax
 Authorities in March 2011, the Department issued Notice u/s 153A (a) of
 the Income Tax Act, 1961 dated October 24, 2011 for submission of
 Income Tax Returns u/s 153A (a) from Assessment Year 2005-06 to 2010-
 11 in pursuance of the search conducted u/s 132 of the Income Tax Act,
 1961. Accordingly, the Company filed Income Tax Returns for the above
 assessment years and the assessments are in progress.
 
 14.  FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBs)
 
 During FY 2007-2008, your Company issued 3,250 Zero Coupon Foreign
 Currency Convertible Bonds (FCCBs) of US$ 100,000 each due 2012 (ISIN
 XS0302937031), aggregating to US$ 325 million to international
 investors to part finance the capital expenditure programme of the
 Company. Each bond is convertible into equity shares of the face value
 of Rs.10 each of the Company at a conversion price of Rs. 953.40 per share,
 at any time on or after August 7, 2007 until the close of business on
 June 21, 2012, unless previously redeemed, converted or purchased and
 cancelled. The bonds, which are not redeemed, converted or purchased
 and cancelled, are redeemable on June 28, 2012 at an amount equal to
 the principal amount of the bonds multiplied by 142.801 per cent.
 
 The principal amount of FCCBs outstanding after conversion of 8 bonds
 and repurchase and cancellation of 15.36% of the remaining outstanding
 FCCBs aggregating to US$ 49.80 million, is US$ 274.40 million.
 
 15.  EXTERNAL COMMERCIAL BORROWING OF US$ 275 MILLION (INCLUDING A
 GREEN SHOE OPTION OF US MILLION) WITH A CONVERTIBILITY OPTION
 
 The Finance Committee, a duly authorised sub- committee of the Board of
 Directors of the Company, has at its meeting held on February 20, 2012,
 approved to avail an external commercial borrowing (ECB) of US $ 275
 million which includes a green shoe option of US $ 75 million.  The
 Company has entered into an indicative, non-binding term sheet with an
 arranger for the ECB. The term of the ECB is 5 years plus 1 day from
 the date of drawdown.
 
 Financial closure is subject to each party receiving all necessary
 approvals and compliance by the Company with certain conditions,
 including (without limitation) the execution of satisfactory
 documentation.
 
 The ECB will be utilised for one or more of the following: (a) Buyback
 of outstanding Foreign Currency Convertible Bonds, (b) Redemption of
 outstanding Foreign Currency Convertible Bonds and (c) Capital
 expenditure.
 
 The lenders of the ECB facility shall have an option to convert in
 whole or in part the outstanding ECB into fully paid equity shares of
 face value of Rs. 10 each, with full voting rights (Equity Shares) or
 GDRs with underlying Equity Shares.
 
 16.  DIRECTORS
 
 Mr. Sajjan Jindal, Dr. Vinod Nowal and Dr. S K Gupta, Directors, retire
 by rotation at the forthcoming Annual General Meeting and being
 eligible, offer themselves for re-appointment.
 
 Your Directors have in their meeting held on January 20, 2012
 reappointed Dr. Vinod Nowal as a Whole time Director of your Company
 designated as ''Director & CEO'' for a period of five years with effect
 from April 30, 2012, subject to your approval. Your Directors have also
 in their meeting held on May 14, 2012, reappointed Mr. Sajjan Jindal as
 the Managing Director the Company for a period of five years with
 effect from July 7, 2012, subject to your approval.
 
 The proposals regarding the re-appointment of the aforesaid Whole Time
 Director and Managing Director are placed for your approval.
 
 Other changes in the Board of Directors of your Company during the year
 under review are as follows:
 
 Smt. Savitri Devi Jindal has, on account of her pre-occupation, stepped
 down from the Board with effect from October 21, 2011 as Chairperson
 and as Director.
 
 Subsequent to her cessation as Chairperson and Director, she continues
 to be associated with the Company as Chairperson Emeritus with effect
 from October 21, 2011.
 
 Mr. Sajjan Jindal was appointed by the Board as its Chairman with
 effect from October 21, 2011.
 
 JFE Steel Corporation nominated Mr. Yasushi Kurokawa as its nominee on
 the Board of the Company, in place of Mr. Shigeru Ogura with effect
 from May 16, 2011.
 
 Karnataka State Industrial Infrastructure and Development Corporation
 Limited (KSIIDC) nominated Mr. Raj Kumar Khatri, IAS as its nominee on
 the Board of your Company in place of Mr. M Maheshwar Rao, IAS with
 effect from June 17, 2011. Subsequently, KSIIDC nominated Dr. Rajneesh
 Goel, IAS as its nominee on the Board of your Company in place of Mr.
 Raj
 
 Kumar Khatri, IAS with effect from November 17, 2011.
 
 Your Directors place on record their deep appreciation of the valuable
 services rendered by Smt. Savitri Devi Jindal, Mr. Shigeru Ogura, Mr. M
 Maheshwar Rao and Mr. Raj Kumar Khatri during their tenure as Directors
 of the Company.
 
 17.  AUDITORS AND AUDITOR''S REPORT
 
 M/s. Deloitte Haskins & Sells, Chartered Accountants, auditors of the
 Company, retire at the conclusion of the ensuing Annual General Meeting
 and have expressed their willingness to act as auditors of the Company,
 if appointed, and have further confirmed that the said appointment
 would be in conformity with the provisions of Section 224 (1B) of the
 Act.
 
 Explanation to Auditor''s Comment:
 
 Auditors have in their report, drawn attention to note no. 26(4) of
 accounts for the year, relating to the Company''s assessment that no
 provision against the carrying amounts of its long term strategic
 investment and loans extended to its subsidiary, JSW Steel (USA) Inc.
 of Rs. 1,948.41 crores is presently necessary.
 
 In the opinion of the Board of Directors, considering an independent
 valuation of a significant portion of the underlying tangible assets,
 review and assessment of business plans and expected future cash flows
 of JSW Steel (USA) Inc., the decline in carrying amounts of investment
 and loans is temporary and no provision is required.
 
 18.  PARTICULARS REGARDING CONSERVATION OF ENERGY AND TECHNOLOGY
 ABSORPTION
 
 Information in accordance with the provisions of Section 217(1)(e) of
 the Companies Act, 1956 read with Companies (Disclosure of Particulars
 in the Report of the Board of Directors) Rules, 1988 regarding
 conservation of energy, technology absorption and foreign exchange
 earnings and outgo is given in the statement annexed (Annexure A)
 hereto forming part of the report.
 
 19.  ENVIRONMENTAL INITIATIVES
 
 The Company has undertaken various measures to address safety and
 environmental issues at its plant locations:
 
 Vijayanagar
 
 - Installed a fume exhaust system at the finishing stand in HSM 1 to
 capture dust generated.
 
 - Installed a waste heat recovery mechanism in the sinter cooling areas
 of sinter plants 1, 2 and 3, to generate steam for use in the blast
 furnace and other shop-floor processes.
 
 - Commissioned a 0.2 mtpa mill-scale briquetting facility, which will
 be used as a coolant in steelmaking.
 
 Salem
 
 - Reduced raw water consumption for coke quenching to 0.55 m3/tonnes
 from 0.64 m3/tonnes by increasing recycled water usage and modifying
 the quenching technique.
 
 - Increased EOF/steelmaking slag recycling to 22 kg/tonne of steel from
 12 kg/tonnes of steel at salem.
 
 - Converted EOF steelmaking slag to useful products (15,000
 tonnes/month) namely road making, cement making flux, sinter feed and
 recovery of metal values.
 
 - Established 100% disposal of fl y ash from CPP to reduce
 environmental concerns.
 
 - Initiated co-processing of external wastes in the sinter plant
 sourced from Kerala Metals & Minerals Ltd after receiving CPCB approval
 on the in-house designed innovative process to utilise hazardous waste.
 
 Vasind & Tarapur
 
 - Celebrated World Environment Day on June 5, 2011 and 360 saplings
 were planted in garden areas of the Vasind plant and colony.
 
 - Bio-digester plant of capacity 1 T per day was commissioned in colony
 no. 2 and 30 households were supplied with bio-gas. The organic waste
 from households is treated through this plant.
 
 20.  PARTICULARS OF EMPLOYEES
 
 The information required under Section 217(2A) of the Companies Act,
 1956 read with the Companies (Particulars of Employees) Rules, 1975 is
 set out in the Annexure to the Directors Report. Having regard to the
 provisions of section 219(1)(b)(iv) of the said Act, the Annual Report
 excluding the aforesaid information is being sent to all the members of
 the Company and others entitled thereto. Any member interested in
 obtaining such particulars may write to the Company Secretary for a
 copy.
 
 21.  CERTIFICATION & RECOGNITION
 
 Your Directors have pleasure in informing you that all the Company''s
 Vijayanagar townships viz. Vidyanagar, Vijay Vittal Nagar and
 Shankargudda Colony townships have been accredited for quality,
 environment systems, safety and health systems in operations and
 maintenance of residential townships. The townships received the
 following certifications:
 
 1) ISO 9001 – 2008
 
 2) ISO 1401 2004 cor.1:2008
 
 3) BSOHSAS 18001 - 2007
 
 22.  AWARDS AND ACCOLADES
 
 Your Company and its employees received the following awards during the
 year:
 
 1.  EEPC National Award for Export Excellence awarded by EEPC Kolkata:
 Gold Trophy for top Exporter for the year 2009-10, received on November
 03, 2011.
 
 2.  EEPC National Award for Export Excellence awarded by EEPC Kolkata:
 Star Performer for the year 2010-11 received on March 24, 2012.
 
 3.  FKCCI Export Excellence Awards awarded by FKCCI Karnataka: Best
 District Exporter Award for the year 2010-11, awarded on June 15, 2011.
 
 4.  Visvesvaraya Industrial Trade Centre State Award awarded by VITC
 Karnataka for the year 2009-10 & 2010-11 Gold Trophy for Best Exporter,
 received on March 23, 2012.
 
 5.  SPJIMR Marketing Impact Awards (SMIA) 2012 awarded by SP Jain
 Institute of Management and Research: Second Prize for Best Practices &
 Current Thinking in Marketing, awarded on January 14, 2012.
 
 6.  Dun & Bradstreet Information Services: Best Company in Steel sector
 based on Total Income, Net Profit, Net Worth, Export, Market
 Capitalisation, Net Profit Margin, Return on Net Worth, received on
 April 26, 2011.
 
 7.  Ashok Leyland: Outstanding Performance Award for the year 2010-11
 received on April 20, 2011.
 
 8.  Whirlpool: Certificate of Appreciation for the year 2010-11,
 received in November 2011.
 
 9.  Brakes India: Certificate of Performance for the year 2010-11
 received on November 11, 2011.
 
 10.  Hyundai: Appreciation Award for the year 2011- 12 received on
 March 22, 2012.
 
 11.  National Sustainability Award awarded by Indian Institute of
 Metals: 2nd prize in Integrated Steel Plants category for the year
 2010-11 received on November 14, 2011.
 
 12.  CII-EXIM award 2011 awarded by Confederation of Indian Industries
 (CII): Commendation certificate for significant achievement, received
 on December 01, 2011.
 
 13.  International Convention on Quality Circle Chapters (ICQCC):
 Distinguished Category Award to Genius Quality Circle from SMS-1
 received on September 14, 2011.
 
 14.  Spot Light Awards (Global Communication Competition) awarded by
 League of American Communication Professionals for its 2010-11 Annual
 Report- Bronze Award for excellence within its Competition Class.
 
 15.  EXIM Achievement Awards in the Category of Top 3 Exporter awarded
 by the Tamil Chamber of Commerce.
 
 Individual and Team Recognitions:
 
 16.  1st Prize to Ms. Anita Dunga for Oral Presentation in ''Iron &
 Steel'' Category for ''Study on Ladle Nozzle Choking during Liquid Steel
 Pouring from Ladle to Tundish at Continuous Casting'' at 65th Annual
 Technical Meeting, on November 16, 2011, at Hyderabad.
 
 17.  3rd Prize to Mr. Pranav Kumar Tripathi for Poster Presentation in
 ''Iron & Steel'' Category for ''Optimisation of Submerged Entry Nozzle
 Design through ''Mathematical Modelling'' at the 65th Annual Technical
 Meeting, on November 16, 2011 at Hyderabad.
 
 23.  CORPORATE GOVERNANCE
 
 Your Company has complied with the requirements of Clause 49 of the
 Listing Agreement regarding Corporate Governance. A report on the
 Corporate Governance practices, the Auditors'' Certificate on
 compliance of mandatory requirements thereof and Management Discussion
 and Analysis are given as annexure to this report.
 
 24.  DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirements under Section 217 (2AA) of the Companies
 Act, 1956, your Directors hereby state and confirm that:
 
 (i) in the preparation of the annual accounts, the applicable
 accounting standards have been followed along with proper explanation
 relating to material departures;
 
 (ii) they have selected such accounting policies and applied them
 consistently and made judgements and estimates that are reasonable and
 prudent so as to give a true and fair view of the state of affairs of
 the Company at the end of the financial year and of the profit or
 loss of the Company for that period;
 
 (iii) they have taken proper and sufficient care for the maintenance
 of adequate accounting records in accordance with the provisions of
 this Act for safeguarding the assets of the Company and for preventing
 and detecting fraud and other irregularities;
 
 (iv) they have prepared the annual accounts on a going concern basis.
 
 25.  APPRECIATION
 
 Your Directors take this opportunity to express their appreciation for
 the cooperation and assistance received from the Government of India,
 Republic of Chile, Central Government of Kenya, Mauritius, Mozambique,
 USA and UK; the State Government of Karnataka, Maharashtra, Tamil Nadu,
 West Bengal and Jharkhand; the financial institutions, banks as well
 as the shareholders and debenture holders during the year under review.
 The Directors also wish to place on record their appreciation of the
 devoted and dedicated services rendered by all employees of the
 Company.
 
                           For and on behalf of the Board of Directors
 
                                                         Sajjan Jindal
 
 Date : May 14, 2012                                          Chairman