Industry in general and Sponge Iron industry in particular, are at the
 crossroads of recovery. The year 2010-11 started on a positive note and
 was greeted with guarded optimism. By the time we stepped into the new
 fiscal, economic meltdown was a thing of the past and business was
 expected to be on an upswing. But the world was besieged by another
 crisis across Middle East and North Africa as the year progressed. The
 disturbances pushed up energy prices significantly. The European
 plummet and a collapse of the Chinese bubble, might set the stage for a
 world-wide recession. In addition, supply side shortage of food items
 kept inflation rising across the economies, specially the developing
 ones.
 
 Coal and iron ore prices have been on the rise in the recent past,
 setting in spectre of raw material shortage in the entire sector.
 However it is heartening that despite these constraints your company
 performed well. I am happy to inform you that in 2010-11, your company
 broke many barriers to set new standards on every front.  Your company
 clocked a record production of 3,83,002 tonnes. The company could
 actually realise 98.2 per cent of its installed capacity, its highest
 ever capacity utilization: truly a commendable feat. Despatches were
 also higher by 19,066 tonnes over the previous year. Power generation
 during the period also witnessed a jump of 10 million units to reach
 191 million units and the sale of 134 million units of surplus power
 supported the additional revenue growth.
 
 Challenges notwithstanding, the Profit Before Tax (PBT) of the company
 rose to Rs 150.28 crore and the Profit After Tax (PAT) to Rs.101.34
 crore, coming close to its best ever financial performance. It remains
 a company with zero debt and a positive EVA. The Board has therefore
 recommended a dividend of Rs 8 per equity share (i.e. 80%).
 
 Your company could achieve this, thanks to superior planning and
 internal management, increasing thrust on Total Plant Maintenance
 (TPM), belief in business process management through Tata Business
 Excellence Model (TBEM) philosophy and practice, engagement of
 employees in a far more meaningful way, intensive training and good
 corporate governance.
 
 As a responsible corporate citizen, concern for the ecology and the
 community has always been prime concern of your company. The company
 succeeded in bringing down levels of Suspended Particulate Matter
 (SPM), Respirable Suspended Particulate Matter (RSPM) and water
 consumption not only at the plant but also at the township as part of
 the companys Daily Work Management. The company could also reduce the
 overall carbon footprint. The two captive power plants of 18.5MW and
 7.5MW, continued to generate power from waste heat. Waste fly ash was
 converted to fly ash bricks. The company has examined possible
 investment in a power plant to recycle waste char (from kilns) to
 generate power through the AFBC boiler based power plant.  The efforts
 of the company in environment management have been awarded by State
 Pollution Control Board of Orissa.
 
 Let me take this opportunity to acknowledge the unstinted support of
 all stakeholders- our shareholders, employees and management,
 suppliers, the community and the state/central government agencies
 -across the 28 years of our existence, and hope for its sustained
 continuance.
 
 
 
 
                                                            A. M. Misra 
                                                               Chairman
 
 
 Jamshedpur 
 6th May, 2011