The Directors submit the following report on Financial Results for the
 year ended 31 st March, 2012:
 
 Financial Results:            For the year ended     For the year ended
                                  31st March 2012        31st March 2011
                                     (Rs. in lacs)           (Rs.in lacs)
 
 Turnover                               10,055.62              15,214.41
 
 Profit / (Loss) 
 before depreciation                    (6,433.95)             (6,866.96)
 
 Depreciation (net of 
 revaluation adjustment)                 1,218.07               1,436.63
 
 Exceptional Items                         530.91                  -
 
 Profit / (Loss) before tax             (8,182.93)             (8,303.59)
 
 Tax for earlier years                     190.79                  -
 
 Provision for Deferred 
 Tax - Assets                            1,846.98               3,017.23
 
 Profit / (Loss) after tax              (6,526.74)             (5,286.36)
 
 Surplus /(Deficit) brought 
 forward from previous year            (12,233.66)             (6,947.30)
 
 Surplus /(Deficit) carried 
 forward to Statement of 
 Profit & Loss                         (18,760.40)            (12,233.66)
 
 Performance
 
 Your Company incurred heavy losses in this year too due to
 un-remunerative selling price of finished products and high cost of
 iron ore and coal prevailing throughout the year leading to a situation
 where higher production meant higher loss. As a result, production was
 at the lowest in the history of the Company and was limited to 42,872
 MT in the sponge iron unit (17.15 % capacity utilization) and was 6,778
 MT in the billet unit (6.78 % capacity utilization). Revenue from power
 sales dropped substantially from Rs. 1,259.54 lacs in 2010-11 to Rs. 365.49
 lacs in 2011-12 due to lower capacity utilization in the sponge iron
 unit. Production will not be remunerative until the cost of iron ore
 and coal reduce and selling price of finished product improves.
 
 Your Company had approached its lenders for a corporate debt
 restructuring to address the irregularity in the borrowings in view of
 difficult market situations which is under consideration.
 
 Your Company is confident to receive forest clearance and permission to
 mine from the iron ore mines allotted to the Company shortly.
 Availability of iron ore from captive mines will vastly improve both
 production and profitability. Availability of coal from captive mine
 will still take a few years and will result in even higher
 profitability.
 
 Open offer formalities are over, which will help consolidate Company''s
 planning and operations.
 
 Subsidiary Company
 
 Bamra Iron & Steel Company (India) Ltd. is a wholly owned subsidiary of
 the Company. As the Company has not started operations and project is
 under implementation, consolidated financial statement has not been
 prepared.
 
 Dividend
 
 Your Directors regret their inability to recommend any dividend for the
 year in view of losses.
 
 Project & Engineering Division
 
 Project and Engineering (P & E) Division has supplied process know-how
 and basic engineering to M/s. Super Smelters Limited, Durgapur for 350
 TPD DRI Plant which has been commissioned in August, 2011 and running
 successfully. The second unit of the said Company is also being built
 under OSIL Technology. 100,000 TPA Sponge Iron Plant, 16 MW Power Plant
 and 100,000 TPA Steel Billet Plant of M/s. Crackers India (Alloys)
 Limited, Barbil, Keonjhar is being built under overall consultancy
 services of this Division. Consultancy and supervisory services for
 renovation, up-gradation and re- commissioning of the mini steel plant
 with Sponge Iron, Power and Steel Mill Shop and Rolling Mill of
 Dinabandu Steel & Power Ltd., Kalinganagar, Odisha, have been completed
 during the year.
 
 The P & E Division supplied process know-how, basic and detailed
 engineering, erection and commissioning, supervision as well as
 operational training for three units of 350 TPD plant to M/s. Usha
 Martin Ltd., which was funded by the World Bank (IFC) and German
 Development Bank (DEG) after worldwide technology selection. The third
 kiln recently completed 600 days of continuous operation.
 
 The P & E Division is also carrying out technical audit of Company''s
 plant health, process health, quality, safety, energy efficiency, and
 environment protection, on a regular basis and recommending corrective
 measures.
 
 Community Development
 
 In line with your Company''s philosophy, your Company continues to
 pursue a comprehensive program of Community Development covering
 education, immunization, agricultural & horticultural extension, mother
 & child care etc. directly and also through OSIL TRFI Community
 Services Trust.  Quality Your Company continues to follow the Quality
 Management System for production and supply of Sponge Iron and Steel
 Billets and possesses Certificate of Registration of ISO 9001:2008 from
 British Certification Inc. Your Company is proud of maintaining the
 clean environment in the vicinity of the Plant and your Company''s
 Environmental Management System applicable to production and supply of
 Sponge Iron and Steel Billets has been certified under ISO 14001:2004
 by British Certification Inc. The Occupational Health and Safety
 Management System of your Company has also been certified by the same
 Agency and your Company complies with the requirements of OHSAS
 18001:2007.
 
 Orissa Sponge Iron & Steel Limited
 
 Listing Fees
 
 The annual listing fees have been paid to the Stock Exchanges where the
 Company''s shares are listed. Your Company''s application to National
 Stock Exchange (NSE) for listing and Calcutta Stock Exchange for
 de-listing is pending before the respective Exchanges.
 
 Reconciliation of Share Capital
 
 As directed by Securities and Exchange Board of India (SEBI),
 Reconciliation of Share Capital is being carried out quarterly by a
 Practising Company Secretary. The findings of the Reconciliation of
 Share Capital were satisfactory.
 
 Directors
 
 Mr. P. C. Mohanty was nominated by Industrial Promotion & Investment
 Corporation of Orissa Ltd (IPICOL) as Additional Director with effect
 from 23.11.2011.  Mr. A. K. Mukherjee was appointed as Additional
 Director with effect from 04.08.2012. Having been appointed as
 Additional Directors.  Mr. P. C. Mohanty and Mr. A. K. Mukherjee shall
 be vacating their office at the ensuing Annual General Meeting. Notices
 under Section 257 of the Companies Act, 1956 have been received from
 some members proposing the candidature of Mr. P. C. Mohanty and Mr. A.
 K.  Mukherjee as Directors in the ensuing Annual General Meeting.
 
 Mr. S. N. Nayak and Mr. M. A. Khan shall retire by rotation at the
 ensuing Annual General Meeting and being eligible offer themselves for
 re-appointment.  Conservation of energy, technology absorption, foreign
 exchange earning and outgo
 
 The information required under Section 217 (1) (e) of the Companies
 Act, 1956 read with the Companies (Disclosure of Particulars in the
 Report of Board of Directors) Rules, 1988 as amended are set out in
 Annexure, which forms part of this Report.
 
 Particulars of Employees
 
 There were no employees drawing the requisite remuneration whose names
 are required to be disclosed as required under sub-section 2A of
 Section 217 of the Companies Act, 1956 read with the Companies
 (Particulars of Employees) Rules 1975 as amended from time to time.
 
 Directors'' Responsibility Statement
 
 In accordance with the provisions of sub-section 2AA of Section 217 of
 the Companies Act, 1956, your Directors state that:
 
 (a) In the preparation of the Annual Accounts, the applicable
 accounting standards had been followed along with proper explanation
 relating to material departures.
 
 (b) Accounting policies selected are applied consistently. Judgments
 and estimates that are reasonable and prudent are made, so as to give a
 true and fair view of the state of affairs of the Company as at 31 st
 March, 2012 and of the Profit/ Loss of the Company for the year ended
 on that date.
 
 (c) Proper and sufficient care has been taken for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956 for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities.
 
 (d) The Accounts for the financial year ended 31st March 2012 have been
 prepared on a ''going concern'' basis.
 
 Auditors
 
 The Statutory Auditors, M/s L. N. More & Co., Chartered Accountants,
 Cuttack, will retire at the conclusion of the ensuing Annual General
 Meeting and being eligible offer themselves for re-appointment.
 
 The Audit Committee and the Board has recommended their re-appointment.
 The necessary resolution is being placed before the shareholders for
 approval. The Company has received confirmation that their appointment
 will be within the limits prescribed under Section 224(1 B) of the
 Companies Act, 1956.
 
 Auditors'' Report
 
 There are no qualifications or adverse remarks in the Auditor''s Report
 which require any clarification/explanation. The Notes on Financial
 Statements are self explanatory and needs no further explanation.
 
 Cost Auditors
 
 Pursuant to the provision of Section 233B of the Companies Act,1956 and
 The Companies (Cost Accounting Records) Rules, 2011, M/s. B. Ray &
 Associates, Cost Accountants, Kolkata was reappointed as Cost Auditor
 of the Company for the year 2012-13 to conduct audit of cost records
 maintained by the Company.
 
 Corporate Governance
 
 Pursuant to Clause 49 of the Listing Agreement with the Stock
 Exchanges, the following form part of the Annual Report:
 
 (i) Management Discussion and Analysis
 
 (ii) Report on Corporate Governance along with Certificate for
 compliance of conditions of Corporate Governance.
 
 (iii) Managing Director''s declaration regarding compliance of Code of
 Conduct by Board Members and Senior Management personnel.
 Acknowledgement and Appreciation
 
 The Directors acknowledge with gratitude the co-operation extended by
 Indian Renewable Energy Development Agency Ltd. (IREDA), Banks, State
 Government, Suppliers, Customers and Shareholders and solicit their
 continued support. The Directors also wish to place on record their
 sincere appreciation of the dedicated services put in by the Company''s
 workers, staff and executives under difficult conditions.
 
 For and on behalf of the                Board Munir Mohanty, Director
 
 Place: Kolkata                       Dr. P. K. Mohanty, Vice Chairman
 
 Dated: 4th August, 2012                           & Managing Director