The Directors take pleasure in presenting the Twenty-eighth Annual
 Report on the business and operations of the company and its financial
 results for the year ended 31st March, 2011.
 
 FINANCIAL RESULTS
 
                                           Current year  Previous year
                                              (Rs. Lac)      (Rs. Lac)
 
 2.  (i) Sales (Net of Excise Duty) and 
     other income                                 69487          54194
 
 (ii) Profit before depreciation                  16880          14560
 
 (iii) Depreciation and other non-cash expenses    1852           1938
 
 (iv) Profit before taxes                         15028          12622
 
 (v) Provision for Current Tax                     5560           4608
 
 (vi) Provision for Deferred Tax                  (666)          (440)
 
 (vii) Fringe Benefit Tax                             -              2
 
 (viii) Profit after tax                          10134           8452
 
 (ix) Profit brought forward from previous year    1232            917
 
 (x) Profit available for appropriation           11366           9369
 
 (xi) Dividend: 80% (2009-2010: 80%)               1232           1232
 
 (xii) Tax on Dividend                              200            205
 
 (xiii) Transfer to General Reserve                8500           6700
 
 (xiv) Surplus carried to Balance Sheet            1434           1232
 
 
 DIVIDEND
 
 3.  The Board has recommended a dividend of Rs.8/- per share (i.e. 80%)
 on 1,54,00,000 equity shares of Rs.10 each for the financial year ended
 31st March, 2011, subject to approval of the shareholders at the
 ensuing Annual General Meeting. The total outgo on account of dividend
 (excluding dividend distribution tax) will be Rs. 1232 lac.
 
 OPERATIONS
 
 4.  During the year, all three kilns were in operation and achieved the
 highest ever production of 3,83,002 MT of sponge iron compared to
 3,59,333 MT in the previous year. The capacity utilisation was 98 % as
 compared to 92% in the previous year, i.e. an increase of 6%.
 
 Iron ore and coal are two major raw materials for making sponge iron in
 rotary kilns. Tata Steel Ltd supplied entire quantity of iron ore. Coal
 India supplied negligible coal against linkages. The company had to
 largely source coal from domestic sources through e-auctions and
 imports. The indigenous coal was optimally used along with imported
 coal. Improved operating practices resulted into longer campaign life
 of Kilns. Substantial reduction in down time of kilns for repairs and
 maintenance was achieved by focussing on modern project management
 techniques.
 
 The despatch of sponge iron during the year was the highest ever at
 3,80,273 MT as compared to 3,61,207 MT in the previous year, i.e. an
 increase of 5%.
 
 POWER
 
 5.  During the year, both the power plants (of 7.5MW and 18.5 MW
 capacity) together produced 191.37 million kwh of power and 133.77
 million kwh of surplus power was sold compared with generation of
 181.39 million kwh and sale of 125.01 million kwh in the previous year.
 There was improvement in supply of power from various power plants to
 State-Grid. This led to reduction in price of power during course of
 the year.
 
 The Board in its meeting held in March, 2011, has approved the
 installation of an AFBC boiler based power plant with a capacity of 25
 MW to utilise the solid waste. The project will be financed with
 internal generation and borrowings. This is subject to obtaining
 necessary approvals / clearances etc.
 
 FINANCE
 
 6.  The market for steel and therefore sponge iron was normal with
 seasonal fluctuations in demand and prices. Prices of iron ore and coal
 gradually firmed up during the year and these reflected in the price of
 product too. Earning per share increased to Rs.65.80 as compared to
 previous year (Rs. 54.88). The company remained debt free during the
 year
 
 DEVELOPMENT OF COAL BLOCK
 
 7.  The work in connection with development of coal block at Radhikapur
 (East) and Utkal-F in Talcher coalfields was started in 2006-07. The
 Company made significant progress in land acquisition and has deposited
 requisite money with Government of Orissa for 1st phase of land
 requirement. Depending upon the money needed, the financial tie-up for
 the coal block will be completed in next few months. The coal block is
 expected to become operational from 2012-13.
 
 TATA BUSINESS EXCELLENCE MODEL (TBEM)
 
 8. Further efforts were made by the company to improve its business
 processes across all functions. During the year the company
 participated in JRD-QV duality Award competition and scored over 550
 marks thereby declared as Emerging Industry Leader. During the year,
 the spirit of achieving excellence was reinforced across the
 organisation through appropriate training and communication by the
 management.
 
 INTEGRATED MANAGEMENT SYSTEM (IMS) FOR QMS.EMS.ANDOKSAS:
 
 9.  The company continued to maintain Integrated Management System
 (IMS) comprising of Quality Management System(ISO : 9001), Environment
 Management System(ISO:14001) and Occupational Health, Safety &
 Accountability Management System(ISO: 18001). The performance on these
 fronts has been mentioned in the Triple Bottom Line report given
 elsewhere in the Annual Report.
 
 AWARDS
 
 10.  In recognition of companys effective pollution control measures
 with adoption of sound environment management practices, the Orissa
 State Pollution Control Board has conferred the company with Pollution
 Control Appreciation Award for2010.
 
 11.; The Company continues to maintain high product quality standards.
 During the year it won, yet again, the prestigious Oil (Eastern Region)
 Quality award for the year 2010. The company was also certified as a
 Model TQM Company for 2010 in an industry wide contest.
 
 LISTING FEES
 
 12. The Annual Listing Fee for the year 2010-11 had been paid to those
 StockExchanges whece the companys shares are listed.  
 
 DIRECTORS
 
 13.  Mr. K.K. Varughese retires by rotation and, being eligible, offers
 himself for re-appointment.
 
 14.  Mr. Arun Misra retires by rotation and, being eligible, offers
 himself for re-appointment.
 
 15.  Mr. P. K. Lahiri, who is also due to retire at the forthcoming
 Annual General Meeting, had informed the company that he does not wish
 to seek reappointment. A resolution pursuant to Section 256 of the
 Companies Act, 1956, for not filling the vacancy caused by the
 retirement of Mr. P. K. Lahiri has been included in the Notice of the
 28th Annual General Meeting.
 
 The Board placed on record its deep appreciation of the sincere
 services and invaluable advice rendered to the company by Mr. P. K.
 Lahiri during his long association as a Director of the company.
 
 CORPORATE SUSTAINABILITY
 
 16.  As a member of Tata Group and as a responsible corporate citizen,
 the company has been undertaking steps towards welfare of society
 around it, community initiatives, periphery development, environment
 protection and improvement in harmony with the normal business and
 contributing to exchequer through various taxes/duties etc. At the same
 time, the company continued its focus on employees health and safety,
 skill development and superior living conditions. The company has taken
 a serious note of threat of global warming and climate change. Through
 a specific study, the company has measured carbon foot prints and is
 taking steps to reduce the Green House Gas emissions.
 
 Corporate sustainability is aligned with Triple Bottom Line approach by
 complying with -
 
 - The UN Global Compact by addressing its ten principles
 
 - Guidelines of Tata Council for Community Initiatives (TCCI)
 
 A detailed report on Corporate Sustainability based on Triple Bottom
 Line approach is appearing elsewhere in the Annual Report.
 
 INCLUSIVE GROWTH
 
 17.  The concept of inclusive growth through Affirmative Action has
 been adopted by the company in the past.  Further efforts have been
 made by the company during the year to strengthen this concept.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS AND OUTGO.
 
 18.  As required under Sub-section 1 (e) of Section 217 of the
 Companies Act, 1956, read with the Companies (Disclosure of Particulars
 in the Report of Board of Directors) Rules, 1988, particulars regarding
 conservation of energy, technology absorption, foreign exchange
 earnings and outgo are annexed to this report.
 
 PARTICULARS OF EMPLOYEES
 
 19.  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, the particulars of such employees
 are given in a statement annexed to this report.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 20.  Pursuant to Section 217(2AA) of the Companies Act, 1956, the
 Directors, based on the representations received from the Operating
 Management, confirm that: -
 
 (i) in the preparation of annual accounts, the applicable accounting
 standards have been followed and that there are no material departures;
 
 (ii) they have, in the selection of accounting policies, consulted the
 statutory Auditors and have 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 2010-11 and of the profit of the company for that
 period;
 
 (iii) they have taken proper and sufficient care, to the best of their
 knowledge and ability, 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;
 
 (iv) they have prepared the annual accounts on a going concern basis.
 
 REPORT ON CORPORATE GOVERNANCE
 
 21.  Pursuant to Clause 49 of the Listing Agreements with the Stock
 Exchanges, the followings form part of this Annual Report:
 
 (i) Managing Directors declaration regarding compliance of Code of
 Conduct by Board Members and Senior Management personnel;
 
 (ii) Management Discussion and Analysis;
 
 (iii) Report on the Corporate Governance;
 
 (iv) Auditors Certificate regarding compliance of conditions of
 Corporate Governance.
 
 VOLUNTARY DELISTING OF THE COMPANYS EQUITY SHARES FROM CERTAIN STOCK
 EXCHANGES
 
 22.  The Equity Shares of the company have been voluntarily delisted
 from The Stock Exchange, Ahmedabad and The Delhi Stock Exchange
 Association Ltd. during 2004-05, from Bhubaneswar Stock Exchange during
 2006-07 and from Calcutta Stock Exchange Association Ltd. during the
 year 2008-09.
 
 Shares of the company are actively traded in the National Stock
 Exchange of India Ltd. and Bombay Stock Exchange Ltd.
 
 AUDITORS
 
 23.  The Auditors, Messrs Deloitte Haskins & Sells, Chartered
 Accountants, retire at the conclusion of the ensuing Annual General
 Meeting and, being eligible, offer themselves for reappointment.
 
 ACKNOWLEDGEMENT
 
 The Board takes this opportunity to sincerely thank all its
 stakeholders namely, shareholders, customers, suppliers/contractors,
 bankers, employees, government agencies, local authorities, and the
 immediate society for their unstinted support and co-operation during
 the year.
 
 
 
 
                                  On behalf of the Board of Directors
 
 
                                                         (A.M. Misra)
                                                             Chairman
 
 Jamshedpur, 
 6th May, 2011