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Star Cement Ltd. के निदेशक की रिपोर्ट

Mar 31, 2025

Your Directors have pleasure in presenting Twenty-fourth (24^th) Annual Report of the Company together with the
Audited Standalone & Consolidated Balance Sheet as at March 31, 2025 and the Statement of Profit & Loss for the year
ended on that date.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the financial year ended March 31, 2025 as compared
to the previous financial year are as under:

Particulars	Consolidated		Standalone
Particulars	2024-25	2023-24	2024-25	2023-24
Total Income	3,17,396.13	2,93,713.22	2,00,621.13	2,93,338.83
Profit before Interest, Depreciation and Tax and exceptional items	58,920.77	58,277.79	12,323.39	43,363.79
Finance Cost	3,162.31	1,260.12	1,986.55	1,295.27
Depreciation and Amortization Expense	33,191.05	14,659.77	18,813.96	8,174.64
Profit before exceptional items and tax	22,567.41	42,357.90	(8,477.12)	33,893.88
Exceptional Items	-	-	-	-
Profit before Tax	22,567.41	42,357.90	(8,477.12)	33,893.88
Provision for taxation:
- Current Tax	5,986.33	7,859.94	-	5,922.15
- Tax for earlier years	0.03	(585.36)	-	(487.76)
- Deferred Tax	(301.15)	5,572.29	(2,630.62)	6,389.70
Net Profit after Tax	16,882.26	29,511.03	(5,846.50)	22,069.79
Other comprehensive income for the year	(5.68)	(136.96)	(13.80)	(131.99)
Total comprehensive income for the year	16,876.58	29,374.07	(5,860.30)	21,937.80
Net profit attributable to:
Owners of the company	16,900.27	29,511.03	-	-
Non-controlling interest	(18.01)	-	-	-
Total	16,882.26	29,511.03	-	-
Other Comprehensive Income attributable to:
Owners of the company	(5.68)	(136.96)	-	-
Non-controlling interest	-	-	-	-
Total	(5.68)	(136.96)	-	-
Total Comprehensive Income attributable to:
Owners of the company	16,894.59	29,374.07	-	-
Non-controlling interest	(18.01)	-	-	-
Total	16,876.58	29,374.07	-	-

OVERVIEW AND OPERATIONAL REVIEW

India''s cement industry is indeed a major player globally,
contributing significantly to the world''s production
capacity. The country''s large limestone reserves make it
an ideal location for cement manufacturing.

India''s cement industry has seen steady growth over the
past few decades, supported by an increasing demand
for housing, infrastructure, commercial construction and

support from the Government. The market is expected
to grow as both urbanization and industrialization
are increasing and the Government also focuses on
infrastructure projects like "Housing for All" and "Smart
Cities" etc.,

In the FY 2024-25, the Indian Government has
implemented several initiatives to bolster the cement
industry, focusing on infrastructure development,

innovation and sustainability. The Government has
committed to an H11 lakh crore capital expenditure
plan aimed at modernizing India''s infrastructure. This
substantial investment is expected to drive demand
for cement and other building materials, providing a
significant boost to the industry.

Recognizing the importance of technological
advancement, the Government has allocated H20,000
crore to foster innovation across various sectors,
including the cement industry. This funding is
intended to accelerate the development and adoption
of green cement solutions, promoting sustainability and
innovation within the sector.

To facilitate infrastructure development at the state level,
the Government has provided H1.5 lakh crore in 50-year
interest-free loans to states. These funds are designated
for capital expenditure on infrastructure projects, which
are anticipated to stimulate demand for cement and
related materials.

Despite the immense potentiality for growth, the sector
faces challenges such as rising fuel and transportation
costs, environmental regulations and supply chain issues.
However, opportunities for innovation in sustainable
production, such as the development of low-carbon
cements and energy-efficient technologies are on the
rise. The increased demand from infrastructure projects,
including roads, railways and airports, continues to be a
major driving force for growth in the industry.

India is also one of the top cement exporters globally. It
exports to neighboring countries in Asia, the Middle East
and Africa. This international demand helps to stabilize
the sector and gives companies more global exposure.

The Indian cement industry is projected to grow by
6-7.5% in fiscal year 2025-26 (FY26), according to recent
industry reports. This anticipated growth will be largely
driven by a rebound in infrastructure development and
housing construction, with a notable push coming from
rural sector activity.

During the year under review, your Company has
manufactured 14,87,226 MT. of Cement Clinker as against
7,60,300 MT. recorded during the FY 2023-24. Company''s
subsidiary M/s. Star Cement Meghalaya Limited has
produced 16,35,763 MT. of Clinker as against 20,44,837
MT. during the FY 2023-24. On consolidated basis total
clinker production during the year was at 31,22,989 MT. as
against 28,05,137 MT. during FY 2023-24. Your Company
recorded overall growth in its performance during the
year.

In terms of capacity utilization, clinkerization unit of your
Company was able to utilize 36% of its installed capacity
as against 76% during the FY 2024-25. M/s. Star Cement
Meghalaya Limited has utilized 82% of its installed capacity
during the FY 2024-25 as against more than 100% during
FY 2023-24. On consolidated basis clinkerization units
utilized 51% of its installed capacity during the FY 2024-25
and fully utilized in FY 2023-24.

Your Company has been able to maintain the performance
on grinding front too. During the year under review, total
cement production on consolidated basis was at 46,96,885
MT. as against 44,44,538 MT. during the FY 2023-24.

Similarly, your Company has been able to achieve sales
volume of 46,51,326 MT. of Cement as against 44,04,208
MT. during the previous financial year.

Although production performance of the Company
improved during the year, however, the Company''s
financial results fell short of expectations. This was
mainly due to the delayed stabilization of the second line
of clinker production. As a result, the Company had to
rely on market purchases of clinker during this interim
period, which exerted pressure on profit margins and
negatively impacted the bottom line.

UPCOMING/NEW PROJECTS

During the year your Company has successfully
commenced commercial production on April 21,
2024, from its'' New Clinker Line of 3.3 MTPA Capacity
situated at Lumshnong, Meghalaya and successfully
commissioned its 12.5 MW WHR projects. Star Cement
North East Limited, a subsidiary Company''s project for 2
MTPA cement plant in Silchar with Railway siding is in
progress and is expected to be commissioned by FY 26.
Another grinding unit of 2 MTPA at Upper Assam location
is in pipeline. Upon completion of the projects, the overall
capacity of cement will increase to 11.7 MTPA.

Besides this, the Company has been declared as the
preferred bidder for limestone mines at Dima Hasao,
Assam with mines reserves of 192.36 million tons. M/s Star
Cement Meghalaya Limited, a Wholly Owned Subsidiary
of the Company, has also been declared as the ''Preferred
Bidder'' for Composite License of Boro Hundong
Limestone Block over an area of 400 hectares with
estimated limestone resource of 146.75 million tonnes.
M/s Star Cement North East Limited, a Wholly Owned
Subsidiary of the Company, has also been declared as the
''Preferred Bidder'' Limestone Blocks situated in Beawer
District, Rajasthan over an area of ~ 95.6823 hectares with
estimated limestone resource of ~ 63.90 million tonnes.

In segment of Other Building Materials, M/s. Star Smart
Building Solutions Limited, [formerly Star Cement (I)
Limited] subsidiary of the Company is commissioning
a AAC Block plant & a chemical plant which is at the
completion stage and the commencement of commercial
production of AAC Block is likely to start by first quarter of
2025-26.

DIVIDEND

The Board of Directors of your company, after
considering holistically the requirement of funds for
Company''s and its subsidiary''s upcoming projects at
Jorhat and Silchar and the relevant circumstances has
decided that it would be prudent not to recommend any
Final Dividend for the FY 2024-25 (PY NIL).

INDIAN ECONOMY AND OUTLOOK - AT
A GLANCE

India''s GDP growth rate of 6.5% for the fiscal year 2024Â¬
25 aligns with the forecasts made by various institutions
like the Reserve Bank of India (RBI), World Bank and IMF,
which had projected growth in the range of 6.3% to 6.8%.
This moderate growth reflects the resilience of the Indian
economy amid global uncertainties, inflation pressures,
geopolitical tensions. This deceleration is attributed to
a weaker manufacturing sector and subdued corporate
investments. Despite this slowdown, the service sector
remains resilient, contributing significantly to the
nation''s economic stability. Additionally, there has been
an improvement in rural demand, which is expected to
support consumption in the coming months.

The retail inflation rate in India for the FY 2024-25 was
4.6% driven by a decline in food prices. This reduction in
inflationary pressures has opened the door for interest
rate cuts by the Reserve Bank of India (RBI), aiming to
stimulate economic growth.

US President Donald Trump has imposed the steepest
American tariffs in a century, escalating trade tensions
and sending ripples through the global economy. India,
among the hardest-hit countries, now faces a 26% tariff on
its exports to the US. However, the temporary reduction
of the tariff to 10% for a three-months period has offered
significant relief to the industry and afforded the country
valuable time for negotiations.

While India has been affected, the impact is somewhat
milder compared to some other Asian nations.
Nonetheless, key export-driven sectors such as textiles,
chemicals and steel could be strained. However, India''s
relatively inward-looking economy and diverse domestic
market position is well to navigate these challenges.
Instead of escalating the trade dispute, India is likely to
engage in diplomatic negotiations with the US. While
short-term market reactions may be negative, the
economy is expected to stabilize and rebound in the latter
half of the year.

In summary, Trump''s aggressive trade stance may
inadvertently create space for India to strengthen its
global trade presence, as long as it stays adaptable and
business-friendly.

India''s economic outlook for the FY 2025-26 is
characterized by moderate growth projections, strategic
policy initiatives and external challenges. The Reserve
Bank of India (RBI) has adopted a growth-supportive
stance, reducing interest rates to stimulate economic
activity and face challenges.

The 2025 Union Budget introduces several growth-
oriented measures, with a strong emphasis on agriculture
sector. Key initiatives such as the Prime Minister Dhan-
Dhaanya Krishi Yojana and enhanced access to credit
through the Kisan Credit Card (KCC) are aimed at
supporting farmers and promoting self-reliance in pulse
production.

These strategic policy interventions contribute to a
cautiously optimistic economic outlook for FY 2025Â¬
26, with GDP growth projected around 6.5%. The focus
on innovation, rural development and agricultural
infrastructure is expected to stimulate broader economic
activity. However, challenges such as global trade
uncertainties, Russian Ukraine war, unrest middle east,
inflation management and the health of the Banking
sector remain areas of concern.

However, the increased emphasis on rural infrastructure
and agricultural development is likely to have a positive
impact on cement demand in the coming period.

CEMENT INDUSTRY OVERVIEW

India occupies a significant position as the second-
largest producer of cement globally, contributing over 8%
of the world''s total installed capacity. This highlights the
country''s considerable role in addressing global cement
demand.

The domestic infrastructure and construction sectors
are poised for substantial expansion, supported by
government-led initiatives such as the Smart Cities
Mission, Housing for All, AMRUT and PMGAY etc. These
developments are anticipated to drive sustained growth
in cement consumption. Additionally, the increasing
demand for rural housing and the steady resurgence of
the industrial sector continue to serve as key drivers of
cement demand, reflecting the broader recovery of the
Indian economy.

The industry''s growth is further underpinned by the
abundant availability of essential raw materials, including
limestone and coal. This accessibility facilitates a stable
supply chain, lowers production costs and enhances the
overall competitiveness of the sector.

Despite these positive trends, significant capacity
additionsâestimated at 35 to 40 million tonnes,
particularly in eastern and southern regionsâare
expected to moderate volume growth. Consequently,
pan-India average capacity utilization levels are projected
to be constrained at approximately 72% over the medium
term.

In recent years, the cement industry has experienced
robust volume growth, largely driven by strong demand
from the housing sector and numerous large-scale
infrastructure initiatives, including the construction of
roads, expressways, airports, metro rail systems and rural
development projects.

However, going forward, cement volume growth is
expected to moderate to a compound annual growth
rate (CAGR) of approximately 7-8% over FY 2025-26 .
This moderation is attributed to the high base of growth
recorded in the preceding three fiscal years. In particular,
demand from rural housing is expected to soften,
following a period of accelerated growth supported by
the Pradhan Mantri Awas Yojana - Gramin (PMAY-G)
scheme.

Nevertheless, continued Government expenditure
on infrastructure, increased construction activity and
ongoing residential projects are expected to support
growth in cement demand. During the first quarter
of FY 25, growth remained modest at 2-3%, partially
influenced by the electoral environment.

Over the next three fiscal years, cement demand from
the housing construction segment is anticipated to
moderate to approximately 4-5%, whereas demand from
the infrastructure segment is expected to exhibit stronger
growth.

The Union Budget 2025 further reinforces this outlook,
with a significant capital outlay of H11.11 lakh crore
allocated under the "Viksit Bharat @ 2047" vision for
infrastructure development. Additionally, the launch
of PMAY-Urban 2.0, aimed at addressing the housing
needs of one crore urban poor and middle-class families
through an investment of H10 lakh crore, is expected to
further bolster cement demand.

The launch of the PM Gati Shakti initiative is aimed at
enhancing multimodal connectivity and establishing a
world-class transportation network across India. This
program is expected to significantly stimulate cement
demand, particularly through infrastructure projects
related to logistics and transportation.

Further affirming the Government''s commitment to
urban development, substantial allocations have been
made under the Urban Rejuvenation Mission (AMRUT),
the Smart Cities Mission and the Swachh Bharat Mission.
These initiatives are likely to contribute to sustained urban
infrastructure development, thereby driving additional
cement consumption.

Despite these positive developments, the cement
industry in India continues to face several operational
and structural challenges that could affect its growth
and profitability. Rising diesel prices and a 5% increase
in railway freight rates in 2024 have led to higher
transportation costs, thereby compressing industry
margins. In the eastern region, logistical delays caused
by a shortage of railway wagons and underdeveloped
infrastructure further disrupt supply chains.

Moreover, intense pricing competition from ultraÂ¬
low-cost regional players has put pressure on larger
manufacturers, affecting their profitability. Environmental
regulations, especially the national drive towards net-zero
emissions, may also result in increased production costs
as companies invest in cleaner and more sustainable
technologies.

Nonetheless, these challenges are counterbalanced by
the Government''s proactive infrastructure push and
policy support. Initiatives like PM Gati Shakti, the Smart
Cities Mission and housing schemes such as PMAY-
Urban 2.0 present a favorable environment for private-
sector cement companies.

Continued Government support through budgetary
allocations and industry-friendly policies is expected to
further catalyze this growth, making the cement industry
an attractive avenue for long-term investment.

EAST & NORTHEAST SCENARIO - GATEWAY
OF OPPORTUNITIES

The Government of India has placed significant emphasis
on the development of the North Eastern Region (NER),
recognizing its strategic importance and untapped
potential. A range of initiatives have been launched
to enhance health, education, infrastructure and
industrialisation in the region, with the aim of improving
socio-economic conditions and promoting balanced
regional growth.

The Ministry of Road Transport and Highways has played
a crucial role in expanding the region''s road infrastructure.
Between 2015 and 2024, a total of 4,950 kilometers of
National Highways were developed in the North East at
an investment of H41,459 crore. Complementing these
efforts, the Ministry for Development of the North Eastern
Region (DoNER) has sanctioned 105 road projects under
schemes such as the North East Special Infrastructure
Development Scheme (NESIDS) and the North East Road
Sector Development Scheme (NERSDS), amounting to
H5,174.59 crore.

NESIDS alone has been approved with a total outlay of
H8,139.50 crore for the period 2023-2026, and in FY 2024Â¬
25, a dedicated allocation of H2,282.85 crore has been made
for both road and non-road infrastructure components.
These initiatives collectively reflect the Government''s
focused strategy to transform the North East into a well-
connected and economically vibrant region.

To further enhance connectivity and promote regional
development in the North East, the Government of India
has allocated H10,376 crore in the Union Budget 2024-25
towards the improvement of railway infrastructure in
the region. As part of this initiative, 60 railway stations in
the Northeast are being redeveloped into Amrit stations
projects, equipped with world-class amenities and
modern facilities.

Additionally, the Union Cabinet has approved the
Uttar Poorva Transformative Industrialization Scheme
(UNNATI), 2024, aimed at stimulating industrial growth
and generating employment in the region. The scheme
carries a financial outlay of H10,037 crore over a period of
ten-year. Under the scheme, eligible industrial units are
required to commence production or operations within
four years from the date of registration.

In terms of state-level budget allocations, West Bengal
has received H6,859 crore for the Pradhan Mantri Awas
Yojana - Rural (PMAY-G), H5,108 crore for capital outlay
on roads and bridges and H2,846 crore for assistance
to local bodies, municipal corporations and urban
development authorities. Similarly, Bihar''s allocations

include H5,092 crore under the Mahatma Gandhi National
Rural Employment Guarantee Scheme (MGNREGS),
H2,071 crore for the Pradhan Mantri Gram Sadak Yojana
(PMGSY), H2,103 crore for PM Awas Yojana - Urban
(PMAY-U), H640 crore for the Smart Cities Mission, and
H3,189 crore for capital expenditure on roads and bridges.
These allocations reflect the Government''s commitment
to holistic regional development, infrastructure
enhancement and inclusive economic growth in the
eastern and north eastern regions of the country.

The Government of India has approved a series of large-
scale infrastructure projects aimed at enhancing regional
connectivity and fostering economic development,
particularly in Bihar, Jharkhand and West Bengal.
Among these, 37 rural works division projects have
been sanctioned, involving road construction spanning
19,876 kilometers at an estimated cost of H17,266 crore.
Additionally, the Patna-Arrah-Sasaram Corridor Project,
with a budget of H3,712 crore, is scheduled for completion
by March 2029. Another notable project is the Kosi-Mechi
Link Irrigation Project, valued at H6,282 crore, being
implemented under the Pradhan Mantri Krishi Sinchai
Yojana - Accelerated Irrigation Benefits Programme
(PMKSY-AIBP).

To enhance interstate connectivity, an elevated flyover
is currently under construction on NH-19, aimed at
strengthening the linkage between Jharkhand and West
Bengal. This project involves an investment of H1,130
crore. Additionally, the Kalyani Expressway is being
upgraded to a 4/6-lane corridor, supported by a budgetary
allocation of H1,652.70 crore. These initiatives are expected
to significantly improve regional connectivity, facilitate
smoother trade, mobility and catalyze economic growth
across the region.

Importantly, such large-scale construction and
infrastructure initiatives are projected to drive substantial
growth in cement demand across the region. This is
likely to have a positive impact on cement manufacturers
operating in Eastern India, providing them with
opportunities for increased sales, market expansion and
long-term investment prospects.

Market Development

Cement demand in Eastern India is projected to
grow at a compound annual growth rate (CAGR) of
approximately 8% during the period 2025-2027. Among
the eastern states, West Bengal and Bihar are the leading
consumers, collectively accounting for over one-fourth
of the region''s total cement demand. West Bengal''s
consumption is estimated at around 24.3 million tonnes,
while Bihar''s stands at approximately 23.6 million tonnes.
Year-on-year, cement demand in West Bengal and Bihar
has increased by 5% and 4%, respectively. With continued
emphasis on infrastructure development, these states
are expected to experience robust demand growth in the
coming years.

The North Eastern Region (NER) remained a key focus
market for the Company during the year. However, the
region exhibited modest growth trends. Cement demand
in the NER declined by 3.8% in the first half of the year but
recovered to grow by 3.7% in the second half, resulting
in an overall marginal growth of 0.3% for FY 2024-25
compared to FY 2023-24. This is notably lower than the
estimated all-India average growth of approximately 7%.

During the year under review, the Company achieved
total cement sales of 4.65 million tonnes, as compared to
4.40 million tonnes recorded in FY 2023-24.

As the market leader in the North East, the Company
continued to strengthen its distribution network. The
Company now maintains a strong presence with
approximately 2,000 plus dealers and 11,000 plus subÂ¬
dealers across the region, further reinforcing its market
leadership and accessibility. The Company is running
mobile application for dealers, influencers, sales, branding
and technical team as follows:

i. Star Saathi App for Dealers ;

ii. Star Saathi App for Rising Star Authorized Retailers ;

iii. Customer Web Portal for Dealers ;

iv. Star Saathi Rewards-Loyalty program for Dealers ;

v. Star Saathi Rewards-Loyalty Program for Rising Star
Authorized Retailers;

vi. Star Link App for Mason and Contractors ;

vii. Star Stellar App for Engineers;

viii. Sales Force Automation App for Sales, Branding,
Technical department & Logistics;

Major achievements of your Company during the year
are follows:

> At NER Star Cement has grown by 8.2% and overall
industry has grown by 0.3 % only in FY 24-25;

> At NER Star Cement Non Trade sales has grown by
40% in FY 24-25 over FY 23-24;

> Focused on Premium product sales hence resulted
growth by 82%;

> Added 2000 plus cement counters during FY 24-25;

> Launch of Dhalai Master Cement in Premium
Category

> First ever Rising Star Authorised Retailer Conference
in NER with over 600 Participants;

During the FY 2024-25 we have launched Star Dhalai
Master Cement, a premium product developed to address
the evolving demands of modern construction replacing
Star Anti Rust Cement. The Brand name ''Dhalai Master''
which was tested during market research showed as a
preferred choice since consumers associate Dhalai with
casting. The term Master was also tested.

To promote the product, we have launched Star Dhalai
Master TVC through TV ads, Cable & Press ads and Digital
campaign through Facebook, Instagram & YouTube and
garner News Coverage through press releases. We also
initiated retail branding with Signage, Inshop branding,
Shop Painting etc. to increase visibility in all our retail
counters. We also continued with the promotion of Star
Weather Shield, the super-premium cement though TV
ads, Cable ad & digital campaigns in all our Social Media
platforms.

Star Cement has always been credited for doing
innovating branding and promotional campaign from
time to time. Featuring celebrities such as Olympic
Medallist & Weightlifter, Saikhom Mirabai Chanu for the
first in the series under the banner of "Har Ghar Mein Star",
the second TVC was launched with the promising, young
& dynamic, the first Indian Cricketer from North East,
Riyan Parag and the third TVC in the series was launched
with the Olympian Ace boxer Lovelina Borghoain. We
also intend to release the fourth TVC under the banner
with the Star Indian Footballer and former National
Football Team Captain Baichung Bhutia whose journey
is one of grit, strength & unshakable foundations-just like
Star Cement.

This year we also initiated a digital marketing campaign
called "Har Ghar Mein Star" Durga Puja Contest & "Har
Ghar Mein Star" Diwali Decoration Contest and continued
with "Happy Pic Lucky Pic Contest" for our Facebook
and Instagram users. The total engagement we had
generated was for more than 80 million users in Facebook
& Instagram from these campaigns.

PRODUCTION AND COST DEVELOPMENTS
Fly Ash

Blended cement presents sustainable option than
the Ordinary Portland Cement (OPC) on account
of its reduced environmental impact and improved
performance. Blended cement production requires
less energy and emits less carbon dioxide compared
to Ordinary Portland cement. Replacing Clinker with
Thermal Power Plants'' generated waste product fly ash
significantly lowers the overall carbon emission and
results into significantly lower carbon footprints as
compared to production of Ordinary Portland Cement
and thus presents an environmentally friendly option.
Moreover, replacement of clinker by fly ash also results
into lower mineral requirement which results into
conservation of scarce mineral resources in form of
Limestone and Coal.

During the year under review too, your company
continued its focus on producing environmentally
friendly blended Pozzolanic Portland Cement (PPC)
along with its premium products like Dhalai Master,
Weather Shield and Anti-Rust products. The proportion
of blended cement produced was around 88% of total
manufactured cement during the year under review.

Your company shall continue to produce blended
cement in future years too.

On the cost front, during the later part of the year under
review, Railway has further enhanced the discounting on
railway freight of Fly Ash resulting into overall reduction
of fly ash cost. Coupled with this, your company has
made efforts to further rationalize the lead distance of fly
ash sources as well as blend of conditioned and Dry Fly
ash.

Logistics & Freight

Your Company successfully navigated market challenges
to ensure uninterrupted supply while maintaining strict
control over logistics costs.

Logistics cost efficiency was further enhanced through
sustained focus on key initiatives such as daily and
monthly e-bidding, PTPK outlier correction mechanisms,
and implementation of Wheeler-wise and Segment-
wise freight strategies. These efforts helped to sustain
the weighted average lead distance which increased
marginally from 220 km to 225 km.

Reaffirming its commitment to providing efficient and
timely delivery services, the Company implemented
several strategic initiatives. During the lean season, a
Jugglery Rake was also strategically utilized to enhance
rake utilization and dispatch efficiency. To meet the
growing needs of institutional customers and enhance
customer centricity, bulk cement carriers (Bulkers) were
deployed to ensure reliable, efficient and dust-free
delivery solutions.

To further strengthen logistics operations and driver
productivity, a Driver Management Centre was
established within the Fleet Division in subsidiary, in
collaboration with OEM partners.

To further enhance serviceability and respond to rising
customer demand, 100 new 16-wheelers and 20 new
small fleet vehicles were procured. These fleets are now
fully operational and have significantly contributed
to improving the subsidiary''s Fleet Division''s overall
productivity, while ensuring uninterrupted clinker
availability at optimized market freight rates to the
Guwahati Grinding Units.

Power cost

During the year under review, your Company continued
to meet the power requirements of its Lumshnong unit
through its wholly owned subsidiary, M/s. Star Cement
Meghalaya Limited, under a long-term arrangement
ensuring reliable supply of quality power at competitive
rates.

To mitigate the impact of rising fuel costs, particularly
due to the increase in coal prices and to optimize overall
power costs, your Company has sourced power for its
Grinding Unit at Guwahati and the integrated cement
plant at Lumshnong also through the Indian Energy
Exchange (IEX).

In line with its commitment to sustainability, your
Company has progressively increased procurement of
renewable power such as solar and wind energy, through
IEX. Additionally, the use of biomass and bamboo
as alternative energy sources has further reduced
dependence on fossil fuel-based electricity.

The Company has also entered into a new Fuel Supply
Agreement (FSA) with Coal India Limited for a period
of 10 years for its new clinker line, which will help to
ensure cost stability in coal procurement. Furthermore,
the successful commissioning of new Waste Heat
Recovery Boiler (WHRB) project is expected to contribute
significantly towards controlling power costs. The full
benefits of these initiatives will be realized in the years to
come.

KEY PERFORMANCE HIGHLIGHTS

> Consolidated cement production was at 46.97 lakh
MT. during the year as against 44.44 lakh MT. during
the previous financial year.

> Consolidated net sales at H2987.79 Crores during the
year under review as compared to H2888.17 Crores
during the FY 2023-24.

> Consolidated EBIDTA was at H589.21 Crores during
the year under review as compared to H582.77 Crores
during the immediate previous FY before exceptional
items.

> Consolidated profit before tax during the FY 2024-25
was at H225.67 Crores as against a profit of H423.57
Crores in the FY 2023-24.

> Consolidated Exceptional items during the FY was
NIL as against NIL recorded in previous FY.

OPPORTUNITIES & THREATS, RISKS AND
CONCERNS

Marketing strength of Star Cement lies on strong dealers
network. Company''s aggressive marketing strategies and
strong branding network also contributed to establish its
position as the market leader in the region. Company''s
new projects alongwith expansion plan would contribute
to strengthen its position in the market. Locational
advantages helped to procure raw materials at affordable
prices.

Opportunities:

(a) Growing Infrastructure Demand of the country led
by ongoing Government projects like Smart Cities,
PMAY (Pradhan Mantri Awas Yojana) and enhanced
focus on road, rail and port development are driving
demand of cement. The National Infrastructure
Pipeline (NIP) and initiatives like "Make in India"
have significantly opened plethora of opportunities
before cement industry. Increasing adoption of green
cement and low-carbon manufacturing processes
offers opportunity for innovation and market
leadership.

(b) Rising population and affordable housing initiatives
boost consumption of cement.

(d) Higher Central budget allocations for roads, railways
and industrial expansion fuel growth of the industry.

(e) Rapid Growth in rural infrastructure, warehousing
and small-town leads to increase in demand of
cement.

Threats:

(a) Cement and power industry is dependent on
availability of raw materials at affordable prices.

(b) The price volatility of coal, pet coke, gypsum and
limestone poses a threat to profitability of cement and
power industry. Stricter environmental compliances
and emission norms increasing manufacturing
costs and which may require significant capital
investments.

(c) The Indian cement market is highly competitive, with
both large-scale players and regional manufacturers,
leading to pricing pressure. Any macroeconomic
slowdown or disruptions (such as a global recession
or geopolitical tensions) may impact construction
activity and demand.

(d) The industry needs to adapt to new sustainable
practices such as alternative fuels, carbon capture
and digitalization to stay competitive.

(e) Cement plants often face social opposition due
to environmental and social impacts, requiring
companies to engage in responsible corporate
practices.

Risks & Concerns

As far risk is concerns cement and power manufacturing is
energy-intensive therefore it is vulnerable to fluctuations
in fuel prices. High logistics and transportation costs,
especially in a geographically vast country like India
impacted bottom line. Foreign trade policy could impact
domestic competitiveness. Distuptions due to extreme
weather conditions or disasters can affect the supply
chain and production facility.

(a) Cement is one of the largest contributors to CO2
emissions and increasing pressure to meet climate
goals raises sustainability concerns. Any major
changes in Environmental and Forest Laws may
impact availability of coal for the industry.

(b) The industry is capital-intensive requiring large
investments for capacity expansion, modernization
and compliance with sustainability norms.

(c) Uneven infrastructure development and housing
demand across the States can lead to underutilization
of capacities in certain regions.

(d) Despite the dominance of a few large players, a
fragmented market with many small-scale operators
leads to inconsistent quality and pricing issues.

(e) The industry''s growth is highly dependent on
Government policies and spending on infrastructure,
making it vulnerable to fiscal constraints.

Addressing these risks through sustainable practices,
innovation and regulatory compliances are essential for
the long-term viability and sustainability of the cement
industry.

Your Company has evolved a risk management
framework to identify, assess and mitigate the key risk
factors of the business. The Board of Directors of the
Company is kept informed about the risk management
of the Company. The Board of Directors have formed a
Risk Management Committee inter alia, to oversee the
risk assessing and mitigation process of the Company
and advice the management in this regard.

SHARE CAPITAL

The paid up Equity Share Capital of the Company as on
March 31, 2025 was H40,41,80,417 divided into 40,41,80,417
equity shares of H1 each. During the year under review, the
Company has neither issued any shares with differential
voting rights nor granted stock options or sweat equity
shares.

SHARES IN SUSPENSE ACCOUNT

Disclosures of the shares lying in Company''s Unclaimed
Shares Suspense Account are given in the Report of
Corporate Governance.

INVESTOR EDUCATION AND PROTECTION FUND

As per Companies Act 2013, dividends that are unclaimed/
unpaid for a period of seven (7) years from the date of
their transfer are required to be transferred to the Investor
Education and Protection Fund (''IEPF'') administered by the
Central Government.

The tentative date for transfer of unclaimed and unpaid
dividends to the IEPF, declared by the Company are as
under:

Financial Year	Date of	Tentative Date for
Financial Year	Declaration	transfer to IEPF
2017-18 (Final)	31^st July, 2018	6^th September, 2025
2019-20 (Interim)	6^th February,	14^th March, 2027
	2020

of IEPF Authority (IEPF) (Accounting, Audit, Transfer
and Refund) Rules, 2016 (''IEPF Rules''), the Company has
uploaded the details of unpaid and unclaimed amounts
lying with the Company as on September 26, 2024 (date
of the last AGM) on the website of the Company at www.
starcement.co.in and also on the website of the Ministry
of Corporate Affairs at www.mca.gov.in.

Further, pursuant to the provisions of Section 124 of the
Act, read with the relevant Rules made thereunder, shares
on which dividend has not been paid or claimed for
seven (7) consecutive years or more shall be transferred
to the IEPF Authority as notified by the Ministry of
Corporate Affairs. Accordingly, Dividend declared for the
FY 2017-18 which was unpaid for Seven (7) consecutive
years aggregating to H4,66,384 and the 54,877 equity
shares in respect of which dividend entitlements has
not been paid or claimed for seven (7) consecutive years
or more will be transferred by the Company to the IEPF
Authority after following the required provisions of Rules
on or before 6^th October, 2025. The Company is in the
process of sending intimation letters to the members and
will publish the advertisement in the newspapers. The
details will be available on the web site of the Company at
www.starcement.co.in

The Interim Dividend declared for the FY 2015-16 and
the underlying equity shares of the Company were
transferred to the IEPF Authroity. The details are available
on the web site of the Company at www.starcement.co.in

Further, the fractional shares entitlement account for
the FY 2016-17 aggregating to H50,460.50/- on which
the amount has not been paid or claimed for seven (7)
consecutive years or more has been transferred to the
IEFP Authority as notified by the Ministry of Corporate
Affairs.

The shareholders whose dividend/Fractional shares
amount/shares have been/ will be transferred to the IEPF
Authority may claim the shares or apply for refund by
making an application to the IEPF Authority by following
the procedure as detailed in the IEPF Rules and as
enumerated on the website of IEPF Authority at http://
www.iepf.gov.in/IEPF/refund.html.

ANNUAL RETURN

In terms of requirement of section 134(3)(a) read
with Section 92(3) of the Companies Act, 2013, the
Annual return of the Company has been placed on
the Company''s website and can be accessed at the
web link: https://www.starcement.co.in/pdf/investor-
information/Annual-Return-2024-25.pdf

MEETINGS OF THE BOARD

During the year four (4) Board Meetings and four (4) Audit
Committee Meetings were convened and held on 22^ndMay, 2024, 09^th August, 2024, 8^th November, 2024 and 30^thJanuary, 2025 respectively. The intervening gap between
the Meetings was within the period prescribed under the
Companies Act, 2013 and SEBI (LODR) Regulations, 2015.

The details of the Board meeting and the Committee
meeting are provided in the Corporate Governance
Report.

MEETING OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent
Directors was held on 13^th March, 2025 wherein the
performance of the Non-Independent Directors and the
Board as a whole, its committees were reviewed. The
Independent Directors at their meeting also inter alia
assessed the quality, quantity and timeliness of flow of
information between the Company''s management and
the Board of Directors of the Company.

COMMITTEES OF THE BOARD

The composition and terms of reference of the Audit
Committee, Nomination and Remuneration Committee,
Corporate Social Responsibility Committee, Stakeholders
Relationship Committee, Risk Management Committee
and Finance Committee have been furnished in the
Corporate Governance Report forming part of this
Annual Report. There has been no instance where the
Board has not accepted the recommendations of the
Audit Committee and Nomination and Remuneration
Committee.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Whistle Blower Policy/ Vigil
Mechanism as required under Section 177 of the
Companies Act, 2013 and as per Listing Obligations
and Disclosures Requirements Regulations, 2015
formulated by Securities and Exchange Board of India
(SEBI). The Vigil (Whistle Blower) mechanism provides a
channel to the employees and Directors to report to the
management, concerns about unethical behavior, actual
or suspected fraud or violation of the Code of Conduct or
policy. The mechanism provides for adequate safeguards
against victimization of employees and Directors to avail
the mechanism and also provide for direct access to the
Chairman of the Audit Committee in exceptional cases.
The said policy may be referred to at the Company''s
website at the web link: https://www.starcement.co.in/
pdf/investor-information/VigilMechanism.pdf

POLICY ON APPOINTMENT AND
REMUNERATION OF DIRECTORS, KEY
MANAGERIAL PERSONNEL AND SENIOR
MANAGEMENT EMPLOYEES

shareholder interests, industry standards and relevant
Indian corporate regulations. The details on the same
are given in the Corporate Governance Report. The said
policy may be referred to at the Company''s website at the
web link: https://www.starcement.co.in/pdf/investor-
information/RemunerationPolicy.pdf

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Listing Regulations, your
Board has framed and adopted a Dividend Distribution
Policy. The object of the policy is to sharing profit of the
Company with the shareholders appropriately and also to
ensure funds are available for the growth of the Company.
The policy inter-alia describes the circumstances under
which the shareholders may or may not expect dividend,
the financial parameters that shall be considered while
declaring dividend, internal and external factors that
shall be considered for declaration of dividend, policy for
utilization of retained earnings and the parameters with
respect to different classes of shares for the purpose of
declaration of dividend. The said policy may be referred
to at the Company''s website at the web link: https://
www.starcement.co.in/pdf/investor-information/
DividendDistributionPolicy.pdf

CODE OF CONDUCT

With intent to enhance integrity, ethics & transparency
in governance of the Company your Company
had adopted a Code of Conduct for Directors and
Senior Management Personnel. The Code has been
displayed on the Company''s website at https://
www.starcement.co.in/pdf/investor-information/
SeniorMangementCodeofConductPolicy.pdf

COMPLIANCE WITH THE SECRETARIAL

STANDARDS AND INDIAN ACCOUNTING

STANDARDS (IND AS)

The Company has complied with the applicable
Secretarial Standards as recommended by the Institute
of Company Secretaries of India. The Company has also
complied with all relevant Indian Accounting Standards
(IND AS) referred to in Section 133 of the Companies Act,
2013 read with Companies (Indian Accounting Standards)
Rules, 2015 while preparing the financial statements.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134(3)(c) read with
Section 134 (5) of the Companies Act, 2013, the Directors
hereby confirm and state that:

> In the preparation of Annual Accounts, the applicable
Accounting Standards have been followed along with
the proper explanation relating to material departures,
if any;

> The Directors have selected such accounting policies
and have applied them consistently and made
judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state

of affairs of the Company as at 31^st March, 2025 and
of the loss of the Company for the year under review;

> The Directors 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;

> The Directors have prepared the annual accounts on
going concern basis;

> The Directors have devised proper systems to ensure
compliance with the provisions of all applicable laws
and that such systems were adequate and operating
effectively.

> The Directors have laid down internal financial
controls to be followed by the Company and that
such internal financial controls are adequate and
were operating effectively.

AUDITORS & AUDITORS'' REPORT
Statutory Auditors

M/s. Singhi & Co., Chartered Accountants (Firm
Registration Number: 302049E), Statutory Auditors of the
Company have been appointed by the members at the
Twenty-First Annual General Meeting of the members of
the Company and shall hold office for a period of 5 years
from the date of such meeting held on 27^th September,
2022.

The Statutory Auditors'' Report "with an unmodified
opinion", given by M/s. Singhi & Co., on the Standalone
and Consolidated Financial Statements of the Company
for the Financial Year ended 31^st March, 2025, is appended
in the Financial Statements forming part of this Annual
Report.

The notes to the accounts referred to in the Auditors''
Report are self-explanatory and therefore, do not call for
any further comments.

Cost Auditors

Pursuant to Section 148 of the Companies Act,
2013 read with the Companies (Cost Records and
Audit) Amendment Rules, 2014, the cost audit
records maintained by the Company in respect of its
manufacturing activity is required to be audited. Your
Directors have, on the recommendation of the Audit
Committee, appointed M/s. B. G. Chowdhury & Co., Cost
Accountants, (Firm Registration Number: 000064) as Cost
Auditors of the Company for the financial year ended
31^st March, 2025 in the Board Meeting held on 22^nd May,
2024. The remuneration proposed to be paid to them for
the FY 2024-25, as recommended by audit committee,
was ratified in the meeting of shareholders held on 26^thSeptember, 2024.

M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm
Registration Number: 000064) have expressed their

willingness to be re-appointed as Cost Auditors of the
Company for ensuing financial year. The Board, on
recommendation of the audit committee has re-appointed
M/s. B. G. Chowdhury & Co., Cost Accountants, as Cost
Auditors of the Company for the FY 2025-26 subject to
ratification of their remuneration by shareholders in the
General Meeting of the Company.

As per the provisions of the Companies Act, 2013, the
remuneration payable to the Cost Auditors is placed before
the Members in a General Meeting for their ratification.
Accordingly, a Resolution seeking Members'' ratification
for the remuneration payable to M/s. B. G. Chowdhury &
Co., Cost Auditors for the FY 2025-26 is included in the
Notice convening the Annual General Meeting.

The Cost Audit report for the FY 2023-24 was filed with
the Ministry of Corporate Affairs on 7^th September, 2024.

Secretarial Auditors

The Audit Committee and the Board of Directors at
their respective meetings held on 21^st May, 2025 have
considered and recommended the appointment
of M/s. MKB & Associates, a firm of Practicing
Company Secretaries, (Firm Registration Number.:
P2010WB042700) as the Secretarial Auditors of the
Company to conduct the secretarial audit, subject to the
approval of the members of the Company and to hold
office for a period of 5 (five) years from 1^st April, 2025 to
31^st March, 2030 in terms of amended requirement of
the SEBI (Listing Obligations & Disclosure Requirement)
Regulations, 2015.

M/s. MKB & Associates, a firm of Practising Company
Secretaries, is a peer reviewed firm and they have given
their consent for the proposed appointment as Secretarial
Auditors of the Company.

The Secretarial Audit Report for the FY 2024-25 is annexed
herewith and marked as Annexure-1. The report is selfÂ¬
explanatory and do not call for any further comments.

In terms of Regulation 24A of Listing Regulations, Star
Cement Meghalaya Limited, a material subsidiary is under
secretarial audit and report submitted by the Secretarial
Auditors for the FY 2024-25 is annexed herewith and
marked as Annexure - 1A. The report is self-explanatory
and do not call for any further comments.

REPORTING OF FRAUD

The Auditors of the Company have not reported any
fraud as specified under Section 143(12) of the Companies
Act, 2013.

BUSINESS RESPONSIBILITY AND
SUSTAINABILITY REPORT

As required under Regulation 34 of Listing Regulations,
the Business Responsibility and Sustainability Report of
the Company for the financial year ended March 31, 2025
is attached as part of the Annual Report.

PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS

During the year under review, your Company has not
made any investment or provided guarantee or security
in connection with a loan to any person exceeding the
limit specified in Section 186 of the Companies Act, 2013.

Details of Guarantees and Investments covered under
the provisions of Section 186 of the Companies Act, 2013
are given in notes to the financial statements.

RELATED PARTY TRANSACTIONS

All related party transactions are entered on arm''s
length basis, in the ordinary course of business and
are in compliance with the applicable provisions of the
Companies Act, 2013. There are no materially significant
related party transactions made by the Company with
Promoters, Directors, Key Managerial Personnel or
other Designated Persons which may have a potential
conflict with the interest of the Company at large. In
terms of Section 134 of the Act read with Rule 8 of the
Companies (Accounts) Rules, 2014, the particulars of the
material contract or arrangement entered into by the
Company with related parties as referred to in Section 188
in form AOC-2 is attached as Annexure-2 of this report.
However, the details of the transactions with the Related
Party are provided in the Company''s financial statements
in accordance with the Indian Accounting Standards.

All Related Party Transactions are presented to the Audit
Committee and the Board. Omnibus approval is obtained
for the transactions which are foreseen and repetitive
in nature. A statement of all related party transactions
is presented before the Audit Committee on a quarterly
basis, specifying the nature, value and terms and
conditions of the transactions.

A policy on ''Related Party Transactions'' has been
devised by the Company which may be referred to
at the Company''s website at the weblink: https://
www.starcement.co.in/pdf/investor-information/
RelatedPartyTransactionsPolicy.pdf

RESERVES

During the year under review no amount was transferred
to reserves.

ENERGY CONSERVATION, TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO

The information on conservation of energy, technology
absorption and foreign exchange earnings and outgo as
stipulated in Section 134(3)(m) of the Act and rules framed
there under is mentioned below:

(A) Steps taken toward Conservation of energy:

The Company remains committed to sustainable
and energy-efficient operations. During FY 2024Â¬
25, several initiatives were undertaken to optimize
energy usage and reduce carbon footprint:

1. Commissioning of 12 MW Waste Heat Recovery
System (WHRS) thereby utilizing waste gases from
the kiln and clinker cooler to generate electricity.
This initiative significantly reduces dependency
on fossil fuels-based power sources, reduction
power cost and reduction in carbon foot print;

2. Installation of Variable Frequency Drives (VFDs)
across multiple process areas to optimize fan
operations and reduce energy demand:

> Mill Reject Bag Filter Fan (561FN1): 30 KW
VFD - savings 10KW/hr.(running at 30Hz);

> Mill Feed Circuits (531FN1 & 531FN2): 2X 37
KW VFDs - saving 16 KW/hr;

> Fly Ash Circuit (K21FNE & K21FNA): 30 KW &
37 KW VFDs - saving 13 KW/hr;

> Clinker Unloading Bag Filters (491FN5 &
491FN1): 30 KW & 55 KW VFDs - savings 28
KW/hr;

> (This saving is against to Damper based
control Vs RPM Based Control on Draft
maintain -137mmwc);

3. Improvement in Power Factor from 0.9860 to
0.9945 by installing APFC panels;

4. Operational Efficiency:

> RABH RA Fan operation shifted to differential
pressure mode, reducing daily run-time by
3.5-4 hours and cutting excess energy usage.

5. Energy-Efficient HVAC:

> Replaced conventional air conditioners with
inverter-based 1.5T and 2.0T units, resulting
in estimated energy savings of ~ 120,000
units/year.

6. Reactive Power Compensation:

Installed LT capacitor banks to enhance KVAR
and maintain PF at 0.99, resulting in energy bill
rebates.

B. Steps taken toward Technical Absorption:

(i) Steps taken towards Technical Innovation:

a. Installation of bin weighing system for bulk
cement loading bins, enhancing operational
accuracy and efficiency.

b. Installation of 55 KW VFD for Cement Mill
1 Main Bag Filter Fan, improving airflow
regulation and reducing power consumption.

c. Commissioned 2 Nos. Air Dryers to eliminate
moisture from compressed air systems,
enhancing pneumatic reliability in the
cement mill and packing plant .

d. Kiln Cooler DCS upgraded with high-speed
CPU and IO modules for better real-time
response.

e. Roller Press PLC software modified in
collaboration with OEM to improve drive
synchronization and minimizing downtime.

(ii) Steps taken towards Technical Absorption:

Replacement of obsolete MV Drive with a new
2700 KW MV Drive for the Bag House Fan,
improving reliability and reducing downtime.

(iii) Steps taken towards Technical Adoption:

Modified tachometer mounting on clinker and
gypsum weigh feeders, reducing maintenance
and preventing frequent stoppages.

Installed RCBOs (Residual Current Breaker with
Overcurrent protection) in colony electrical
distribution for enhanced personnel safety.

> The Company has developed a Research
& Development cell for carrying out R&D
Projects in the plant with specific objective of
development of advanced systems for quality
improvement. During the year under review,
your Company incurred Capital expenditure
of H186.97 Lakhs (P.Y. H9.35 Lakhs) and
Revenue Expenditure of NIL (P.Y. H0.37 Lakhs)
in Research & Development.

(B) Foreign Exchange Earnings And Outgo:

During the period under review, Foreign Exchange
Earning was NIL (PY - NIL) and the Foreign Exchange
Outgo was H789.05 Lakhs (PY H808.43 Lakhs).

CORPORATE SOCIAL RESPONSIBILITY
INITIATIVES (CSR)

Star Cement Ltd has consistently been a frontrunner in
Corporate Social Responsibility (CSR) initiatives across
the North-Eastern and Eastern regions of the country.
Since its inception, the Company has adopted a CSR
policy that emphasizes need-based, sustainable and
holistic development of the surrounding communities.
In line with this commitment, Star Cement continues
to provide a range of community welfare services in the
areas of Health, Education, Livelihood, Environment
and Biodiversity, Rural Infrastructure Development and
Emergency Response. Throughout the FY 2024-25, these
efforts aim to enhance the quality of life and overall wellÂ¬
being of residents in the vicinity of its plant operations.

Your Company has always been a pioneer in various
social welfare initiatives, consistently undertaking
meaningful activities aimed at the betterment of
the community at large. In its pursuit of long-term
stakeholder value creation, the Company remains
committed to respecting the interests of and being
responsive to its key stakeholders - particularly
communities from socially and economically
disadvantaged backgrounds including women, children,
the elderly and other underprivileged and marginalized
groups.

Importantly, the Company''s CSR initiatives extend well
beyond statutory obligations, as evidenced by the fact
that any excess contributions made in previous years are
not set off against future CSR liabilities. This underscores
the Company''s genuine commitment to inclusive,
sustainable development rather than mere compliance.

Pursuant to Section 135 of the Companies Act, 2013 read
with Schedule VII thereof and Rules made thereunder,
your Company''s social responsibility policy is offering
number of community welfare services in the field
of Health, Education, Livelihood, Environment and
Biodiversity, Rural infrastructure development and
emergency response etc., for the local inhabitants of plant
operational areas to improve the quality and standard of
living. Your Company undertook various activities during
the FY 2024-25 under review in line with its CSR Policy.

The composition of CSR Committee of your Company,
attendance at the said Meeting, terms of reference of the
CSR Committee and other relevant details have been
provided in the Corporate Governance Report forming
part of the Annual Report. The CSR Committee has
confirmed that the implementation and monitoring
of CSR Policy is in conformity with CSR objectives and
policy of the Company and in compliance with Section
135 of the Companies Act, 2013.

Your Company''s Policy on Corporate Social Responsibility
can be accessed on the Company''s website at httpsV/www.
starcement.co.in/pdf/investor-information/CSRPolicy.pdf

Annual Report on CSR as required to be annexed in terms
of requirement of Section 135 of Companies Act, 2013
and rules framed thereunder is annexed herewith and
marked Annexure-3.

EVALUATION OF THE BOARD''S PERFORMANCE

In accordance with the requirements of the Companies
Act 2013, the performance evaluation of the Board was
carried out during the year under review. The Board
follows a formal mechanism for the evaluation of the
performance of the Board as well as Committee. The
evaluation reflected the overall engagement of the Board
and the Committee.

A structured questionnaire was prepared after taking
into consideration inputs received from the Directors,
covering various aspects of the Board''s functioning such
as adequacy of the composition of the Board and its
Committees, Board culture, execution and performance
of specific duties, obligations and governance etc.

The Nomination and Remuneration Committee at its
meeting established the criteria based on which the
Board evaluate the performance of the Directors.

judgment, safeguarding the interest of the Company
and its minority shareholders, etc. The performance
evaluation of the Non-Independent Directors and Board
as a whole was also carried out by the Independent
Directors.

The Directors had expressed their satisfaction over the
evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review Mr. Rajendra Chamaria,
Vice Chairman & Managing Director of the Company
have resigned from the post w.e.f. close of business hours
of 27^th January, 2025. The board record their appreciation
for the valuable services, guidance and contributions
given by him during his association with the Company
as the member of the Board.

The tenure of Mr. Amit Kiran Deb and Mr. Deepak Singhal
Independent Directors of the Company were due to expire
on 31^st March, 2025 and 28^th June, 2025 respectively. On
the recommendation of Nominaton & Remuneration
Committee, the Board at its meeting held on 09^th August,
2024, re-appointed Mr. Amit Kiran Deb and Mr. Deepak
Singhal as the Independent Directors of your Company
for further period of three years with effect from 1^st April,
2025 and 29^th June, 2025 till 31^st March, 2028 and 28^th June,
2028 respectively. The Company in its Annual General
Meeting held on 26^th September, 2024 has taken approval
of the shareholders for the above re-appointments.

In accordance with the provisions of Companies Act,
2013 and in terms of the Memorandum and Articles of
Association of the Company, Mr. Sanjay Agarwal (DIN:
00246132) and Mr. Pankaj Kejriwal (DIN: 00383635) will
retire by rotation and being eligible, offer themselves for
re-appointment. In view of their considerable experience,
your Directors recommend the re-appointment of
Mr. Sanjay Agarwal and Mr. Pankaj Kejriwal as Directors
of the Company.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that
they meet the criteria of independence as laid down
under Section 149(6) of the Companies Act, 2013 and they
have complied with the Code for Independent Directors
prescribed in Schedule IV to the Act and the Listing
Regulations. Mr. Nirmalya Bhattacharyya, Mrs. Ibaridor
Katherine War, Mrs. Plistina Dkhar, Mr. Amit Kiran Deb,
Mr. Deepak Singhal, Mr. Vivek Chawla, Mr. Jagdish
Chandra Toshniwal and Mr. Ramit Budhraja are
Independent Directors on the Board of your Company.
In the opinion of the Board and as confirmed by these
Directors, they fulfill the conditions specified in section
149 of the Act and the Rules made thereunder and the
Listing Regulations about their status as Independent
Director of the Company.

Your Board of Directors formed an opinion that the
Independent Directors of the Company are maintaining

highest standard of integrity and possessing expertise,
requisite qualifications and relevant experience in the
fields of Administration, General management, Accounts
& Finance, Audit , Internal Audit, Taxation, Risk, Board
procedures, Governance etc., for performing their role
as Independent Directors of the Company. Regarding
proficiency, all Independent Directors have registered
themselves in the Data Bank maintained with the Indian
Institute of Corporate Affairs (IICA), Manesar. In terms of
Section 150 of the Companies Act, 2013 read with Rule
6(4) of the Companies (Appointment and Qualification
of Directors) Rules, 2014, all the Independent Directors
of the Company have confirmed that they have a valid
registration with the Independent Directors'' databank
maintained by the Indian Institute of Corporate Affairs
(IICA) and have also completed the online proficiency
test conducted by the IICA, if not exempted.

FAMILIARIZATION PROGRAMME FOR
INDEPENDENT DIRECTORS

In order to enable the Independent Directors to
perform their duties optimally, the Board has devised a
familiarization programme for the Independent Directors
to familiarize them with the Company, their roles, rights,
responsibilities in the Company, nature of the industry
in which the Company operates, business model of the
Company, etc. They are periodically updated about the
development which takes place in the Company. Periodic
presentations are made at the Board and Committee
Meetings, updates of the Company, business strategy and
risks involved. Site visits are arranged, whenever required.
At the time of appointment of an Independent Director,
the Company issues a formal letter of appointment
setting out in detail, the terms of appointment, duties,
responsibilities and commitments etc. The familiarization
program is available on the Company''s website under the
web link: https://www.starcement.co.in/pdf/investor-
information/FamilarizationProgrammePolicy.pdf

BOARD DIVERSITY

Your Company believes that a diverse Board is essential
for success of an organization. A diverse Board influences
eradicating differences in knowledge, skills, gender, age,
geographical differences, cultural background etc., this
ultimately effects competitive advantages. The Board
has adopted the Board Diversity Policy which sets out
the approach to the diversity of the Board. The said
Policy is available on your Company''s website at https://
www.starcement.co.in/pdf/investor-information/
BoardDiversityPolicy.pdf

SUBSIDIARIES AND ASSOCIATE COMPANY

M/s. Star Cement Meghalaya Limited, M/s. Star Century
Global Cement Private Limited, M/s. Star Smart Building
Solutions Limited [formerly, Star Cement (I) Limited], and
M/s. Star Cement North East Limited continue to remain
subsidiaries of the Company.

Further, during the year under review M/s. Ri Pnar Cement
Private Limited and M/s. Kopili Cement (I) Private Limited
have been incorporated as the wholly owned subsidiary
companies.

M/s. Star Cement Meghalaya Limited, a material
subsidiary, is engaged in manufacturing of Cement
Clinker and has a Clinkerization plant with an installed
capacity of 1.8 MTPA. During the year under review,
the Company manufactured of 16,35,763 MT clinker as
against 20,44,837 MT in FY 2023-24.

M/s. Star Cement North East Limited, a subsidiary
Company having 2 MTPA Cement Grinding plant, during
the year under review, the Company manufactured
of 17,97,591 MT of cement as against 88,328 MT in
FY 2023-24.

M/s. Star Century Global Cement Private Limited, a
wholly-owned subsidiary in Myanmar, M/s. Ri Pnar
Cement Private Limited & M/s. Kopili Cement (I) Private
Limited are yet to commence operations.

M/s. Star Smart Building Solutions Limited [formerly, Star
Cement (I) Limited] subsidiary is commissioning a AAC
Block plant and a chemical plant. AAC Block plant which
is in completion stage and commercial production is
expected to start by first quarter of FY 26

CHANGES IN NATURE OF BUSINESS, IF ANY

There has not been any change in the nature of business.

BOARD POLICIES

The Board of Directors of your Company, from time to
time have framed and revised various Polices as per the
applicable Acts, Rules, Regulations and Standards for
better governance and administration of the Company.
The Policies are made available on the website of the
Company at https://www.starcement.co.in/investors-
information/codes-and-policies. The policies are
reviewed periodically by the Board and updated based on
need and requirements.

AUDITED FINANCIAL STATEMENTS OF THE
COMPANY''S SUBSIDIARIES

Pursuant to Section 129(3) of the Act, the statement
containing the salient features of the financial statement
for the year ended 31^st March, 2025 for each of the
Company''s subsidiaries viz. M/s. Star Cement Meghalaya
Limited, M/s. Star Century Global Cement Private Limited,
M/s. Star Smart Building Solutions Limited [formerly, Star
Cement (I) Limited], M/s Star Cement North East Limited,
M/s. Ri Pnar Cement Private Limited and M/s. Kopili
Cement (I) Private Limited are annexed in the Form AOC
- 1 and marked as Annexure-4.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company
have been prepared in accordance to requirements of the

Companies Act, 2013 and IND AS as prescribed by the
Institute of Chartered Accountants of India and has been
included as a part of this Annual Report.

The detailed financial statements and audit reports of
each of the subsidiaries of the Company are available
for inspection at the Registered Office of the Company
during office hours between 11:00 A.M. and 01:00 P.M. The
Company will arrange to send the financial statements of
the subsidiaries upon written request from a shareholder
to the registered address of the said shareholder.

In accordance with Section 136 of the Act, the audited
financial statements, including consolidated financial
statements and related information of your Company and
audited accounts of each of its subsidiaries, are available
on website of your Company at www.starcement.co.in.

DEPOSITS

During the year under review, the Company has not
accepted any deposits from public or from any of the
Directors of the Company or their relatives falling under
ambit of Section 73 of the Companies Act, 2013.

SIGNIFICANT MATERIAL ORDERS PASSED BY
THE COURTS / TRIBUNAL OR REGULATORS

(i) The Company had filed Compounding Application
before the Regional Controller of Mines, Indian
Bureau of Mines (IBM), Guwahati for compounding
of certain alleged offences for contravention
of Rule 11(1) of MCDR, 2017 in respect of Wah-
Pynkon Limestone Mine. Accordingly, the Regional
Controller of Mines, Indian Bureau of Mines (IBM),
Guwahati vide its order dated 26^th March, 2025
has compounded the alleged offence. The total
compounding fees of H10,00,000 (Rupees Ten Lakhs),
has been paid by the Company.

(ii) The Company had received a demand notice
dated February 19, 2020 from the Director of
Mineral Resources, Meghalaya, for payment of
royalty, MEPRF, VAT/GST for H4,184.06 lakhs in
pursuance to the National Green Tribunal (NGT)
order dated January 17, 2020 for alleged illegal coal
procurement. By passing the said order NGT had
accepted the recommendation of 5^th Interim Report
of the Independent Committee set up by NGT, which
then suggested imposition of penalty on cement
companies and thermal power plants in Meghalaya.

The Company did not purchase any illegal coal and
had complied with all disclosure requirements of
the various Government Departments. The Report
of NGT Committee was based on the assumptions
& views of the Committee and not on hard facts.
Moreover neither the Company has been issued
a show-cause nor was any opportunity of being
heard given to the Company before submitting the
Interim reports by the Independent Committee to
NGT. Further NGT did not serve any notice on the

Company before passing the impugned order which
is a clear violation of principles of natural justice.

In the previous year on an appeal by the Company,
the Apex Court vide it''s order dated May 2, 2023
restored the proceeding back to NGT, at the stage, as
it stood prior to the passing of the judgement dated
January 17, 2020. Subsequently the matter has been
transferred to the NGT, Eastern Zone Bench, and the
Company has filed necessary affidavits and the matter
is subjudice. No provision has been considered
necessary at this stage . [Refer Note No 45(a) of Notes
to Accounts].

(ii) As reported in the earlier year, the Company
had received a demand notice dated March 20,
2023 from the Divisional Mining Officer (DMO),
Directorate of Mineral Resources, Meghalaya, Jowai
towards outstanding dues of royalty & Cess on Coal,
Sandstone, Clay and Shale procured/consumed by
the Company in certain specific periods between F.Y.
2009-10 to F.Y. 2022-23 amounting to H2650.31 lakhs
(including H1552.61 lakhs towards Penal Interest)
against which a provision amounting to H439.92 lakhs
had been made in the books of accounts till the last
years on account of abundant precaution. As per the
provisions of the Mines and Minerals (Development
and Regulation) Act, 1957, the liability for payment of
royalty in respect of any mineral removed/ consumed
from the mining lease area arises on the holder of
the mining lease and not on the purchaser of such
mined minerals. Hence, there is no obligation of the
Company to pay royalty/cess in case the minerals are
procured from third party vendors. Further during the
year, the office of DMO has withdrawn and issued no
dues certificates towards its demand for payment of
Royalty & Cess on Clay and Sandstone and waived off
/reduced the penal interest on Sandstone and coal
respectively. Thereby the above demand amounting
to H2650.31 lakhs (including H1552.61 lakhs towards
Penal Interest) has been reduced to amounting to
H549.90 lakhs (including H109.98 lakhs towards Penal
Interest). Based on the same and since the liability
to pay royalty & cess itself is not applicable to the
company, no provision of demand on royalty on coal
of H109.98 lakhs has been provided and shown as
contingent liability.

The office of DMO in its correspondences during the
year, has again raised the demand towards Royalty
& Cess on Shale & Clay amounting to H428.97 lakhs
for the period Feb''2020 to May''2024 without giving
detailed breakup of the same. Even though, the same
office of DMO has already withdrawn and issued no
dues certificates towards its demand for payment
of Royalty & Cess on Clay and Shale for the period
Feb''2020 to Dec''2022 and Feb''2020 to Jan''2024
respectively before raising the above demand.
Since the company had already applied for no due
certificate for the remaining period and expected to

receive in due course, no provision has been made in
the books of accounts in this regard.

Based on the legal opinion received in this regard, the
Company has disputed the demand and believe that
the said demand is not tenable and the matter shall be
disposed of in the favour of the Company. [Refer Note
No 45 (b) of Notes to Accounts].

(iii) The Company had received a demand notice
from the Director General of Goods & Service Tax
Intelligence (DGGI), Shillong towards non-payment
of GST under reverse charge mechanism (RCM)
amounting to H861.23 Lakhs on payment of Royalty,
DMF, NMET & Mineral cess and H239.23 Lakhs
towards ineligible input tax credit (ITC) availed by the
company under RCM during certain specific periods
between July 2017 to December 2018 (along with
penalty amounting to H861.23 & 239.23 Lakhs and
interest thereon).

The Company has made the adequate payment of
GST under RCM amounting to H239.23 Lakhs @ 5%
applicable rate, before the issuance of demand notice,
which has not been taken in cognizance by DGGI and
imposed a demand of H861.23 Lakhs based on a higher
rate of 18% based on CBIC circular no. 164/20/2021-
GST dated 6^th October 2021 with retrospective effect.
By giving a reference of a Tribunal decision on a
similar case in the favour of assessee, the company
has submitted its reply to DGGI and sought for disposal
of the matter in its favour and no communication has
been received from DGGI since then and the matter is
pending. The company considers the above demand
non tenable and deserves to be set aside. Based on
the legal opinion received, the Company believes that
it has a good case in this matter and no provision is
required at this stage. [Refer Note No 45(c) of Notes to
Accounts].

Other than the aforesaid, there have been no
significant and material orders passed by the Courts/
Regulators impacting the going concern status and
future operations of the Company.

MATERIAL CHANGES AND COMMITMENTS
AFFECTING THE FINANCIAL POSITION OF
THE COMPANY

No material changes or commitments have occurred
between the end of the financial year and the date of
this Report which affect the financial statements of the
Company in respect of the reporting year.

CREDIT RATINGS

Your Company enjoys a sound reputation for its prudent
financial management and its ability to meet financial
obligations. CRISIL has re-affirmed the short term & long
term fund based limits rating as CRISIL A1 (pronounced
as CRISIL A One Plus) and ''CRISIL AA/Stable'' (pronounced
CRISIL double A). The outlook for long term fund based
limits are stable.

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System,
commensurate with the size, scale and complexity of its
operations. To maintain its objectivity and independence,
the Internal Audit function reports to the Chairman of the
Audit Committee of the Board.

The Board of Directors of the Company on the
recommendation of the Audit Committee, appointed
an in-house team of employees headed by Mr. Anik
Chakrabarty, Chartered Accountant as the Internal
Auditors of the Company to conduct Internal Audit for the
FY 2024-25. The Internal Auditors monitors and evaluates
the efficacy and adequacy of internal control system in
the Company, its compliance with operating systems,
accounting procedures and policies at all locations of the
Company. Based on the report of internal audit function,
process owners undertake corrective action in their

respective areas and thereby strengthen the controls.
Significant audit observations and recommendations, if
any, along with corrective actions thereon are presented
to the Audit Committee of the Board.

INTERNAL CONTROL OVER FINANCIAL
REPORTING

The Company has in place adequate internal financial
controls commensurate with the size, scale and
complexity of its operations. During the year, such
controls were tested and no reportable material weakness
in the design or operations were observed. The Company
has policies and procedures in place for ensuring proper
and efficient conduct of its business, the safeguarding
of its assets, the prevention and detection of frauds
and errors, the accuracy and completeness of the
accounting records and the timely preparation of reliable
financial information.

DETAILS OF SIGNIFICANT CHANGES (I.E., CHANGES OF 25% OR MORE) IN KEY FINANCIAL RATIO
AND CHANGE IN RETURN ON NETWORTH ALONGWITH DETAILED EXPLANATIONS

Key Financial ratios	FY 2024-25	FY 2023-24	% change	Explanation for Significant Changes
Debtors Turnover ratio	16.26	27.43	(40.70)	Decrease due to lower sales and higher debtors during the year.
Inventory Turnover ratio	12.90	20.03	(35.61)	Decrease due to lower sales and higher inventory during the year.
Interest Coverage ratio	6.20	33.48	(81.48)	Decrease on account of lower EBITDA achieved during the year
Current ratio	0.68	0.51	31.70	Increase in current assets by 34.86% mainly due to increase in inventories.
Debt Equity ratio	0.26	0.05	374.47	Increase due to higher debt level by 357.95%.
Operating Profit Margin (%)	(3.26)	12.16	(126.81)	Decrease on account of lower EBITDA achieved during the year.
Net Profit Margin (%)	(3.03)	7.68	(139.45)	Change on account of loss incurred durig the year.
Return on Net Worth (%)	(3.54)	14.03	(125.20)	Change on account of loss incurred durig the year.

MANAGERIAL REMUNERATION AND
PARTICULARS OF EMPLOYEES

The disclosures with respect to the remuneration of
Directors and employees as required under Section 197 of
Companies Act, 2013 read with Rule 5 (1) of the Companies
(Appointment and Remuneration of Managerial
Personnel) Rules, 2014 along with a statement containing
particulars of employees as required under Section 197
of Companies Act, 2013 read with Rule 5 (2) and (3) of
the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 is annexed herewith
and marked as Annexure- 5 and forms part of this report.

DETAILS OF APPLICATION MADE OR ANY
PROCEEDING PENDING UNDER THE
INSOLVENCY AND BANKRUPTCY CODE, 2016

There was no application made or proceeding pending
against the company under the Insolvency and
Bankruptcy Code, 2016, during the year under review.

DETAILS OF DIFFERENCE IN VALUATION

The requirement to disclose the details of difference
between amount of the valuation done at the time of
onetime settlement and the valuation done while taking
loan from the Banks or Financial Institutions along with
the reasons thereof, is not applicable.

POLICY ON PREVENTION OF SEXUAL
HARASSMENT

The Company values the integrity and dignity of its
employees. The Company has put in place a ''Policy
on Prevention of Sexual Harassment'' as per the Sexual
Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013 ("Sexual Harassment
Act") and has constituted the Committee with internal
and external members. We affirm that adequate access
has been provided to any complainants who wish to
register a complaint under the policy. No complaint was
received during the year.

The policy on Prohibition, Prevention & Redressal of
Sexual Harassment is available on the website of the
Company at https://www.starcement.co.in/investors-
information/codes-and-policies

CORPORATE GOVERNANCE

The Company has complied with the corporate
governance requirements as stipulated under the Listing
Obligations and Disclosures Requirements Regulations,
2015 formulated by Securities and Exchange Board of
India (SEBI). A separate section on corporate governance,
along with a certificate from the auditors confirming the
compliance, is annexed and forms part of the Annual
Report. This certificate will be forwarded to the Stock
Exchanges along with the Annual Report of the Company.

DY. MANAGING DIRECTOR (DMD) /CHIEF
FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the Listing
Obligations and Disclosures Requirements Regulations,
2015 formulated by Securities and Exchange Board
of India (SEBI), the DMD/CFO certification has been
submitted to the Board and a copy thereof is contained in
this Annual Report.

RISK MANAGEMENT

Risk management refers to the practice of identifying
potential risks in advance, analyzing them and taking
precautionary steps to reduce the risk. The Company
has evolved a risk management framework to identify,
assess and mitigate the key risk factors of the business.
The Board of the Company is kept informed about the
risk management of the Company.

The Risk Management policy is available on the website
of the Company at https://www.starcement.co.in/pdf/
investor-information/RiskManagementPolicy.pdf

HUMAN RESOURCE DEVELOPMENT &
INDUSTRIAL RELATIONS

At Star Cement Limited, our people remain the
cornerstone of our success. In FY 2024-25, the Human
Resources function undertook several strategic and
employee-centric initiatives to enhance capability,

engagement and workplace culture across the
organization.

In line with our focus on digital transformation, we
introduced HR Digi Buddyâan AI-powered employee
engagement platform. This tool enables real-time
feedback and insights into employee sentiments,
empowering HR and business leaders to take timely and
data-driven actions to improve engagement.

A critical priority for the year was to build a strong internal
and external talent pool aligned with future business
needs. We onboarded Executive Trainees through a
structured manpower planning, hiring and onboarding
process bringing in fresh talent with the potential to
evolve into future leaders. To enhance the quality of
hiring decisions, we implemented Competency-Based
Hiring Interviews.

Celebrating milestones and loyalty, we felicitated 52
employees with Long Service Awards acknowledging
their dedication, loyalty, and sustained contribution to the
organization during the Independence Day celebration
reinforcing our value of appreciation and recognition.

We have taken significant strides to embed a culture of
continuous learning across all levels of the organization.
A structured Integrated Learning Platform was
institutionalized to capture the developmental needs of
employees. This platform offered targeted skill-specific
learning interventions.

Our consistent efforts towards fostering an inclusive,
engaging and progressive work environment have
been widely recognized. Star Cement Limited has been
recognized as a ''Most Preferred Workplace for FY 2024Â¬
25'' by India Today in association with Business Standard
â a prestigious honor that reflects our unwavering
commitment to a people-first philosophy and an
inclusive, high-performing work culture. We were also
recognized as one of the ''Top 50 Happy Companies to
Work For'' by the World HRD Congress, reaffirming our
commitment to employee well-being, engagement and
organizational culture.

Industrial Relations have been effective with several
interventions & good practices. During the year gone
by, there has not been any material changes in human
resources and industrial relations as proactively employee
welfare related aspects across plant locations were
addressed and taken care of.

AWARDS AND ACCOLADES

Star Cement not only believes in selling high quality
cement but also believes in high ethics and values. The
company is recognized as the most employee friendly
company across the industry and has been awarded as
the one of the Top 50 Preferred Workplace for FY 2024-25
at 33 World HRD Congress held in Mumbai. Additionally,
during the years Star Cement has garnered several

other awards which includes Red Carpet Experiential
Marketing Awards for Best Use of Technology for Dhalai
Master Cement Launch; Best Online Entertainment for
Star Cement Theme Song; Best Product Launch for Star
Weather Shield Cement Launch Campaign; Best Use of AI
in Experiences for Star Weather Shield Cement Launch.
In 2024 Star Cement Ltd was also honoured to win three
prestigious awards at the 11^th Edition of Exchange 4Media
Indian Marketing Awards 2024! The Awards are:

Gold - Brand Identity/Packaging (Star Weather Shield
Cement)

Silver - Category Creation (Star Weather Shield Cement -
Super Premium Cement)

Silver - Best Use of Segmentation (Star Weather Shield
Cement)

Additionally, The brand has also won awards such as Best
Dealer Meet - ADC Star Cement "Sitaron Ka Milan 2024",
Mumbai; Indian Marketing Awards 2024; Most Effective
Campaign for Return on Investment on Branding at the
3^rd Influencer Awards 2024; Best CSR Performance 2024
award at the 2^nd North East CSR Forum 2024; India''s Most
Admired & Valuable Company in Corporate Governance
2024 & the Inspiring Business Leadership Award at the
13^th Annual ILC Power Brand Awards 2024; Brand of the
Decade Awards 2024 in the cement category; "India''s
Rising Star Award & Social Impact Award; Assam Rising
Award for Corporate Social Responsibility 2023-24.

GREEN INITIATIVES IN CORPORATE
GOVERNANCE

Ministry of Corporate Affairs has permitted Companies
to send copies of Annual report, Notices, etc., electronically
to the email IDs of shareholders. Your Company has
arranged to send the soft copies of these documents to
the registered email IDs of the shareholders, wherever
applicable. In case, any shareholder would like to receive
physical copies of these documents, the same shall be
forwarded upon receipt of written request in this respect.

The Ministry of Corporate Affairs has taken ''Green
Initiative in the Corporate Governance'' by allowing
paperless compliances by the Companies and has
issued circulars stating that service of notice/documents
including Annual Report can be sent by e-mail to
its members for the financial year 31^st March, 2025.

A newspaper advertisement in this regard is being
published.

Your Company prefers e-demand module for
transportation of material through Indian Railways
which helps for carbon saving. It is the amount of saving
of carbon emission in Tonnes of CO2 on account of
transportation of goods by railways instead of road.

CAUTIONARY STATEMENT

Statements in this report describing the Company''s
objectives, expectations or predictions, may be forward
looking within the meaning of applicable securities laws
and regulations. Actual results may differ materially from
those expressed in the statement. Important factors that
could influence the Company''s operations include: global
and domestic demand and supply conditions affecting
selling prices, new capacity additions, availability of
critical materials and their cost, changes in Government
policies and tax laws, economic development of the
country, our business, the businesses of our customers,
vendors and partners and other factors which are material
to the business operations of the Company.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their
deep sense of gratitude to Banks, Central and State
Governments and their departments and the local
authorities, customers, vendors, business partners/
associates for their continued guidance and support.

Your Directors would also like to place on record their
sincere appreciation for the commitment, dedication
and hard work put in by every member of the Company
and dedicates the credit for the Company''s achievements
to them. Last but not least, your Directors express
their gratitude to the shareholders of the Company for
reposing their confidence and faith in the Management
of the Company and look forward for their support in
future.

For and on behalf of the Board of Directors

Sajjan Bhajanka

Place: Kolkata Chairman & Managing Director

Date: 21^st May, 2025 (DIN: 00246043)

Mar 31, 2024

Your Directors have pleasure in presenting Twenty-Third Annual Report of the Company together with the Audited Standalone & Consolidated Balance Sheet as at March 31, 2024 and the Statement of Profit & Loss for the year ended on that date.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the financial year ended March 31, 2024 as compared to the previous financial year are as under:

(H in Lakhs)

Particulars	Consolidated		Standalone
	2023-24 \|	2022-23	2023-24 \|	2022-23
Total Income	2,93,713.22	2,75,692.95	2,93,338.83	2,73,415.39
Profit before Interest, Depreciation and Tax and exceptional items	58,277.79	52,047.47	43,363.79	33,886.92
Finance Cost	1,260.12	969.50	1,295.27	1251.13
Depreciation and Amortization Expense	14,659.77	13,111.22	8,174.64	7,751.63
Profit before exceptional items and tax	42,357.90	37,966.75	33,893.88	24,884.16
Exceptional Items	-	-	-	-
Profit before Tax	42,357.90	37,966.75	33,893.88	24,884.16
Provision for taxation:
- Current Tax	7,859.94	6,721.57	5,922.15	4,397.01
- Tax for earlier years	(585.36)	(759.74)	(487.76)	(772.82)
- Deferred Tax	5,572.29	7,244.51	6,389.70	4,857.92
Net Profit after Tax	29,511.03	24,760.41	22,069.79	16,402.05
Other comprehensive income for the year	(136.96)	33.76	(131.99)	30.94
Total comprehensive income for the year	29,374.07	24,794.17	21,937.80	16,432.99
Net profit attributable to:
Owners of the company	29,511.03	24,760.41	-	-
Non-controlling interest	-	-	-	-
Total	29,511.03	24,760.41	-	-
Other Comprehensive Income attributable to:
Owners of the company	(136.96)	33.76	-	-
Non-controlling interest	-	-	-	-
Total	(136.96)	33.76	-	-
Total Comprehensive Income attributable to:
Owners of the company	29,374.07	24,794.17	-	-
Non-controlling interest	-	-	-	-
Total	29,374.07	24,794.17	-	-

OPERATIONAL REVIEW

The Indian cement market is poised for significant growth in the years to come. As of 2023, the India cement market stood at 396.7 Million Tons. It is anticipated that growth in the market, estimating to reach 599.7 Million Tons by 2032. This indicates a Compound Annual Growth Rate (CAGR) of 4.7% during the period of 2024-2032.

Various Government initiatives like "Housing for All" and the Smart Cities Mission provide a structured framework for development, creating sustained demand for cement. Increasing Government initiatives and investments in infrastructure projects play a crucial role in boosting the demand for cement. Large-scale infrastructure projects

such as the National Infrastructure Pipeline (NIP), Bharatmala Pariyojana and development of roads, bridges, railways, airports, and housing schemes will not only improve connectivity but also stimulate demand for cement across different regions of the country. Ongoing innovations in cement production techniques contribute to the efficiency and sustainability of cement industries. Adoption of advanced technologies enhances productivity and reduces environmental impact. Growing awareness of environmental concerns, particularly related to carbon emissions and sustainability, is driving the adoption of greener cement production methods. Regulatory measures aimed at reducing carbon footprint and promoting sustainable practices also influence market dynamics.

The announcement of cement corridors under the Indian Railways represents a strategic initiative aimed at improving logistics efficiencies, reducing transportation costs, and promoting sustainable multimodal connectivity in the cement industry.

Overall, the positive outlook for the Indian cement industry is underpinned by a combination of demographic trends, urbanization, and government-led initiatives aimed at fostering growth and development.

Despite the growth prospects, challenges such as fluctuating raw material prices, regulatory hurdles, and intense competition within the industry could impact market dynamics.

During the year under review, your Company has manufactured 7,60,300 MT. of Cement Clinker as against 7,59,263 MT. recorded during the FY 2022-23. Company''s subsidiary M/s. Star Cement Meghalaya Limited has produced 20,44,837 MT of Clinker as against 19,62,393 MT. during the FY 2022-23. On consolidated basis total clinker production during the year was at 28,05,137 MT. as against 27,21,656 MT. during FY 2022-23. Your Company recorded overall growth in its performance during the year.

In terms of capacity utilization, clinkerization unit of your Company was able to utilize 76% of its installed capacity as against 75.93% during the FY 2022-23. M/s. Star Cement Meghalaya Limited has fully utilized its capacity during the FY 2023-24 like FY 2022-23 On consolidated basis clinkerization units was fully utilized its capacity during the FY 2023-24 and 97.20% utilisation in FY 2022-23.

Your Company has been able to maintain the performance on grinding front too. During the year under review, total cement production on consolidated basis was at 44,44,538 MT. as against 40,56,452 MT. during the FY 2022-23.

Similarly, your Company has been able to achieve sales volume of 44,04,208 MT of Cement as against 40,13,643 MT. during the previous financial year.

UPCOMING/NEW PROJECTS

The Company has successfully commenced commercial production on April 21, 2024, from its'' New Clinker Line of 3.3 MTPA Capacity situated at Lumshnong, Meghalaya. Company''s 12.5 MW WHRB projects in Lumshnong is underway. The 2 MTPA Cement Grinding unit of the Company''s subsidiary M/s Star Cement North East Limited at Sonapur, Assam has started its commercial operation on the 12^th Day of March, 2024. Star Cement North East Limited, a subsidiary Company''s project for 2 MTPA cement plant in Silchar with Railway sliding is in progress. Upon completion of the projects overall strength and position of your Company in cement market will be improved.

DIVIDEND

The Board of Directors of your company, after considering holistically the requirement of funds for Company''s and its subsidiary''s upcoming projects at Lumshnong and Silchar and the relevant circumstances has decided that it would be prudent, not to recommend any Final Dividend for the Financial Year 2023-24 (Previous year NIL).

INDIAN ECONOMY AND OUTLOOK - AT A GLANCE

India''s economic journey is indeed remarkable. Despite facing significant challenges such as the COVID-19 pandemic and existing macroeconomic imbalances, the country has maintained a strong growth trajectory. With a current GDP estimate of $3.7 trillion for FY24, India has emerged as the fifth-largest economy in the world.

Moody''s, a global rating agency, has revised its GDP growth projection for India in the calendar year 2024 to 6.8 percent, an increase from the earlier projection of 6.1 percent. This adjustment is primarily attributed to India''s strong economic performance in 2023 and the reduction in global economic challenges due to certain geopolitical issues.

India''s economy outperformed expectations during the October-December quarter, with growth reaching 8.4 percent, surpassing analysts'' forecasts of 6.6 percent. This growth was fueled by increased government capital spending and robust manufacturing activity.

Looking ahead, India''s ambition to achieve a $5 trillion GDP by 2027 is driven by continued economic reforms, infrastructure development, and leveraging its demographic dividend. If successful, this growth trajectory will position India as the third-largest economy in the world, further solidifying its status as a major global economic player.

Strong domestic demand remains the main strenght for the growth. Higher reliance on domestic demand

cushioned India from multiple external headwinds. With strong domestic demand, India remains the fastest growing major economy in the world.

It is anticipated that India will maintain its position as the fastest-growing economy amongst G-20 nations.

India''s interim budget for financial year 2024- 2025 targets a capital expenditure allocation of H11.1 lakh crore, representing 3.4 percent of GDP, which is 16.9 percent higher than the estimates for financial year 2023- 2024.

India''s successful hosting of the G20 Summit in 2023 has bolstered its position on the global market, enhancing stability and fostering optimism for its future growth prospects. The country continues to be an attractive investment destination, supported by its vast market size, diverse operational opportunities, abundant skilled workforce and advancements in technology and innovation.

In parallel, India has undertaken substantial reforms to improve its ease of doing business environment. These reforms have focused on simplifying and digitizing regulatory compliance processes across the entire business lifecycle from incorporation to the cessation of operations.

The sector mix within the industry comprises the housing sector (57%-59%), infrastructure sector (27%-29%), and industrial/commercial (13%-15%) sector. The housing segment demand is expected to be moderate over the next five years and will remain a key contributor for the development of the cement sector. Even as housing will continue to be the key volume contributor, infrastructure will expand its share in the next five years. The production-linked incentive (PLI) schemes implemented by the Government of India have played a significant role in revitalizing the manufacturing sector. These schemes have facilitated the development of critical value chains and industrial clusters. The Government is considering extending the PLI scheme to additional sectors, likely labor-intensive industries to foster growth and development in the segments.

The Interim Budget for 2024-25 increased the target under PMAY-(G) by 20 million houses for next five years under the Government''s initiative for rural low-cost housing. This would contribute for incremental cement demand of at least 15 MTPA.

The Government has allocated substantial funds for the construction of highways, railways, airports and advancement of other critical infrastructure development projects. This investment is expected to create new business opportunities, employment generation, enhance connectivity and stimulate economic growth of the Country. More cities will get Namo Bharat and Metro Rail infrastructure projects, to promote the e-vehicle ecosystem, charging infrastructure will be supported by the Government.

The aforesaid initiatives will have positive impact on cement demand of the country in the period to come.

CEMENT INDUSTRY OVERVIEW

India holds a significant position as the second-largest producer of cement globally with more than 8% of the world''s installed capacity. This indicates the country''s substantial contribution towards meeting global demand for cement.

India''s infrastructure and construction sectors are poised for substantial development, which is expected to drive demand for cement. Initiatives of the Government like development of smart cities contribute to this growth trajectory, creating opportunities for increased cement consumption. Cement consumption in India has been consistently growing, partly fueled by increasing demand for rural housing. Strong expansion in industrial sector acts as a key driver for cement demand, reflecting the broader economic recovery of the country.

The ready availability of essential raw materials such as limestone and coal further supports the growth of the cement industry. This ensures a stable supply chain and reduces production costs, enhancing the industry''s competitiveness.

Significant capacity additions and moderation in cement volume growth are expected to constrain Pan India average capacity utilization levels below 70% over the medium term.

In recent years, the cement industry has benefitted from high volume growth, majorly driven by good demand from the housing sector, numerous infrastructure projects such as construction of roads, expressways, airports, metro rail, and generous rural demand.

Cement volume growth is expected to moderate to 5% to 6.5% compounded annual growth rate over FY25 and FY26 on the high base of earlier three fiscals. The slowdown in demand growth is also from rural housing with a high base of growth observed over the recent past on account of the PMAY-(G) scheme.

Cement demand from housing construction is expected to be moderate at around 4-5% over the next three fiscal years while demand from infrastructure is expected to grow

In the latest Budget 2024 announcement, a substantial increase in the allocation of H11.11 lakh crore for infrastructure development would boost the cement demand. The Pradhan Mantri Awas Yojana has the second-highest allocation in 2024-25 at H80,671 crore, an increase of 49.1% over the revised estimate of 2023-24.

The launch of PM Gati Shakti aims to enhance multimodal connectivity and develop a world-class transport network in India. This initiative is anticipated to boost demand for cement, particularly in infrastructure projects related to transportation and logistics.

The allocation of funds for Urban Rejuvenation Mission (AMRUT), Smart Cities Mission, and Swachh Bharat Mission underscores the Government''s focus on urban development.

Overall, aforesaid Government initiatives signal a favorable environment for private sector cement companies, providing them with opportunities for growth and investment in line with the country''s infrastructure development goals. The combination of factors such as infrastructure development, rising demand, industrial recovery, foreign investment, and raw material availability etc., posed India''s cement sector for sustained growth in the long term. Continued Government budgetary support and conducive policies can further catalyze this growth trajectory, making the industry a promising investment opportunity.

EAST & NORTHEAST SCENARIO - GATEWAY OF OPPORTUNITIES

The Government of India prioritizes North-east development due to its strategic location. Various initiatives have been launched, leading to improved health, education, infrastructure, and industrialization. These efforts are aiming to uplift these regions and enhance their infrastructure and socio-economic prospects.

The Ministry of Road Transport and Highways has played a pivotal role in enhancing the road network across the North Eastern Region. Over the past nine years (20142023), a total of 4,950 km of the National Highway Network has been developed for H41,459 crores. In addition, the Ministry of Development of the North Eastern Region has sanctioned 77 road projects under schemes like NESIDS and NERSDS, amounting to H3,372.58 crore.

The North East Special Infrastructure Development Scheme (NESIDS) has received a total approved outlay of H8,139.50 crore for the period spanning from 2023 to 2026. In 2023-24, allocation of H2491.00 crore has been designated for both the NESIDS-Road and NESIDS-Other Than Road Infrastructure components.

Infra projects with a length of 1,772 km of H45,090 crores are planned for 2024-25. A four-lane connectivity to Itanagar with a length of 166 km has been awarded for H5,481 crore with 162 km completed so far. Further, a four-laning Numaligarh - Dibrugarh highway of 183 km has been approved with a budget of H5,653 crores with 129 km completed so far. Additionally a 4-lane bridge is under construction over the Brahmaputra River between Dhubri and Phulbari on NH 127B with a total length of 19 km for H4,997 crore.

With the objective of improving railway connectivity, in 2023-24, a budget of H10,269 crores have been allocated, highlighting the government''s dedication to advancing rail infrastructure in the region. 60 stations in the Northeast are being redeveloped with world-class amenities and facilities.

The Union Cabinet has approved the Uttar Poorva Transformative Industrialization Scheme (UNNATI), 2024 to foster industrial growth and employment generation in the northeast. The scheme''s total cost is H10,037 crores, covering 10 years with an additional 8 years for committed liabilities. All eligible Industrial Units are to commence their production or operation within 4 years from the grant of registration.

As per the Union Budget (2024-25) of West Bengal, a total of H6,859 crores have been allocated for PMAY - Rural, H5,108 crore has been allocated for capital outlay on roads and bridges and H2,846 crore has been allocated for assistance to local bodies corporations, urban development authorities. The government had also announced a major investment of H2,550 crores for the Kolkata Metro Rail. Under PMAY 1,164,782 houses are still under construction.

As per the union Budget of Bihar, H5,092 crore has been allocated towards MGNREGS, H2,071 crore has been allocated towards Pradhan Mantri Gram Sadak Yojana. H2,103 crore has been allocated towards PM Awas Yojana-Urban, H640 crore has been allocated towards the Smart City Mission and H3,819 crore has been allocated for capital outlay on roads and bridges. Under PMAY 88,483 houses are still under construction.

The aforesaid projects will help to increase cement demand in the Region which is likely to have positive impact on the Companies operating in the Region.

Market Development

East India cement demand is expected to grow with a CAGR of 9% by 2024-2026 estimated. West Bengal and Bihar is the strongest cement consuming state in the eastern-region accounts with more than one-fourth of the region''s total demand at ~23 million tonnes and 22 million tonnes estimated respectively. Cement demand in West Bengal and Bihar has grown by 1% YOY, however with ongoing thrust on infrastructure these States are likely to witness strong demand in the years to come.

North East Market continued to be the focus market for your company. Cement demand was good throughout the year. Demand increased by 7.5% in NER against an all India average of ~7% estimated.

During the year under review your company was able to sell overall 4.40 Million Tonnes. of cement as against 4.02 Million Tonnes during the FY 23-24.

Overall Cement demand in North East accounted for 14 Mn Tonnes in FY 23-24 as against 13 Mn Tonnes in FY 22-23.

As a market leader in NER your Company has further consolidated dealers and sub dealer''s network. Currently your Company is associated with 2,000 dealers and 11,000 sub dealers.

Company is running mobile application for dealers, influencers, sales, branding and technical team as follows:

i) Star Saathi App for Dealers

ii) Star Saathi App for Rising Sub Dealers

iii) Customer Web Portal for Dealers

iv) Loyalty program for Dealers

v) Star Link App for Mason and Contractors

vi) Star Steller App for Engineers

vii) Sales Force Automation App for Sales, Branding and Technical department.

Major achievements of your Company during the year are follows:

Q At NER Star Cement has grown by 13% and overall industry has grown by 7.5 % in FY 23-24

Q At NER Star Cement Non Trade sales has grown by 34% in FY''23-24 over FY''22-23

Q Focused on Premium product sale and resulted grown by 53%

Q Added 1900 plus cement counters during FY''23-24

Q Launch of Weather Shield Super premium Cement

Q First ever International Annual Dealer Conference

This year your Company launched the Maverick Product Star Weather Shield -the super-premium product developed with water resistant properties for the tough weather conditions of North East & Eastern region. This product likely to set a new standard in cement industry.

As a part of the digital initiative, an Artificial Intelligence based greeting card was launched for our network to send out personalized e-greeting card to their friends & families which is again one of its kind used by any Cement Brand in the industry.

This year we also initiated a digital marketing campaign called "Best Ethnic Dress Contest & continued with "Happy Pic Lucky Pic Contest" for our Facebook and Instagram users. The total engagement we had generated was for more than 6 million users in Facebook & Instagram from these campaigns.

PRODUCTION AND COST DEVELOPMENTS Fly Ash

Increased Flyash procurement was done as the sales target of FY''24 were higher as compared to the previous years. In the process we have procured 13.1 Lakh MT of Fly Ash which is 3% higher as compared to FY''23.

Various cost saving initiatives were implemented through out the year to negate the impact of Rail freight subsidy reduction in North Eastern Region. Sourcing from other sources with lower landed cost as well as cost reduction of existing sources enabled the Company to maintain optimum cost.

Logistics & Freight

Your company steered through these challenges to ensure that supplies to market are ensured while keeping the cost in control.

Logistics Cost Efficiency was further improved through sustained efforts of key initiatives such as monthly and daily e-bidding, PTPK Outlier corrections, Wheeler Wise & Segment Wise freight. Weighted average lead distance continued to remain at 220 KM range.

Your Company has always focused on giving best Logistics services to our customers for timely delivery at the most economical costs & for the same many new initiatives were implemented such as Stock on Wheels (SoW) at all locations, Enhanced Bidding Portal, GPS enabled fleet monitoring as well as Juggler rake for wagon wise delivery at various sidings. To further enhance the serviceability and efficiency for customer demand, 20 no. new small fleet were ordered whereas as 100 no. new 16 Wheelers were ordered to ensure continued clinker availability at optimized market freight at our Grinding units.

Power cost

During the year under review, your Company continued to source its power requirement for its Lumshnong unit from its wholly owned subsidiary M/s. Meghalaya Power Limited (merged with Star Cement Meghalaya Limited) under long term arrangement for supply of quality power at competitive rates and thus, has been able to reduce dependency on State utility/grid power. Cost of coal has a direct bearing on fuel cost. In view of increasing fuel cost due to increase in price of coal and to optimize the power cost and to reduce dependency on State utility / grid power, your Company has been able to source its power requirement of its Grinding Unit at Guwahati and integrated cement plant at Lumshnong from Indian Energy Exchange (IEX). The blend of sourcing has not only reduced power cost for your Company but also its quality and dependability. By inclining towards procurement of Renewable Power like Solar & Wind from Indian Energy Exchange, your company has shown its commitment towards promotion of renewable resources and reduction of consumption of electricity generated from fossil based fuel. Use of bio mass and bamboo also helped to reduce dependence on traditional sources.

Sourcing of Coal through FSA for 10 years period was successfully allotted to your company The Company also procured good quantity of Coal on spot auctions from CIL during the year, keeping the overall cost in control.

KEY PERFORMANCE HIGHLIGHTS

Q Consolidated cement production was at 44.45 Lakhs MT during the year as against 40.56 Lakhs MT during the previous financial year.

Q Consolidated net sales at H2888.17 Crores during the year under review as compared to H2,575.55 Crores during the financial year 2022-23.

Q Consolidated EBIDTA was at H582.77 Crores during the year under review as compared to H520.47 Crores during the immediate previous financial year before exceptional items.

Q Consolidated profit before tax during the year 202324 was at H423.57 Crores as against a profit of H379.67 Crores in the year 2022-23.

Q Consolidated Exceptional items during the year was Nil as against Nil recorded in previous year.

OPPORTUNITIES & THREATS, RISKS AND CONCERNS

Marketing strength of Star Cement lies on strong dealers network. Company''s aggressive marketing strategies and strong branding network also contributed to establish its position as the market leader in the region. Company''s new projects alongwith expansion plan would contribute to strengthen its position in the market. Locational advantages helped to procure raw materials at affordable prices.

Company''s dependence on domestic market and business concentration on regional market for a longer period of time may adversely affect the growth of the Company. Increased input cost and logistical costs impacts profitability of the Company. Environmental impact and other force majure events may affect the operations of the Company. To overcome from the problem accumulated due to regional concentration, the Company is also planning to reach in other region of the country.

Government''s budgetary allocation and various initiatives like Make in India, Housing for all, development of Ports, Roads and Highways, dam & irrigation project, National Highway Development programme, Bharat Nirman Yojana, dedicated Freight Corridors, Gauge conversion Projects undertaken by Railways, development in the area of alternative source of energy viz. Hydro and Solar Power and other infrastructure projects is expected to boost Cement and Power Demand of the country. Government''s special drive for development of the North Eastern Region has been helping the sustained development of the region.

Competition in the cement industry is very high apart from the large players there are also small players in the market. Competition from the foreign players may lead to tougher competition to the domestic players. This allows limited market share in the industry. Constant increase in diesel costs leads to high transportation cost. Availability of coal at a affordable cost became a constraint factor. The industry currently is very dependent on uninterrupted supply of coal which might create problem in the procurement process. In order to tackle the situation

your Company optimally utilising its reserved coal and entering Fuel Supply Agreement with various suppliers. Cement Industry is highly fragmented and it is also highly regionalized, transportation of low volume of cement over long distances become uneconomical.

Cement and power industry being majorly dependent upon availability of raw materials at affordable cost. Policies of the Government as well as Central and State Laws may adversely affect the availability of lime stone, coal etc. Any major changes in Government''s Environmental and Forest regulations may affect limestone and coal availability to cement plants. However, your Company is sourcing raw materials from alternate sources so that raw materials availability risks is mitigated. Company''s vast dealer''s network across the States also helping to mitigate the risk. Rising concern of carbon emissions due to cement sectors, is pushing the industry to come up with cleaner/greener processes. As the Government is looking for regulations to reduce carbon emissions it will further make things difficult for small players to compete with the larger Companies. Therefore, companies are focusing on green cement which will be produced by various techniques to reduce carbon emissions.

Your Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of Directors of the Company is kept informed about the risk management of the Company. The Board of Directors have formed a Risk Management Committee inter alia, to oversee the risk assessing and mitigation process of the Company and advice the management in this regard.

SHARE CAPITAL

The paid up Equity Share Capital of the Company as on March 31, 2024 was H40,41,80,417 divided into 40,41,80,417 equity shares of H1 each. During the year under review, the Company has neither issued any shares with differential voting rights nor granted stock options or sweat equity shares.

SHARES IN SUSPENSE ACCOUNT

Disclosures of the shares lying in Company''s Unclaimed Shares Suspense Account are given in the Report of Corporate Governance.

INVESTOR EDUCATION AND PROTECTION FUND

As per Companies Act, dividends that are unclaimed/ unpaid for a period of seven (7) years from the date of their transfer are required to be transferred to the Investor Education and Protection Fund (''IEPF'') administered by the Central Government.

The tentative date for transfer of unclaimed and unpaid dividends to the IEPF, declared by the Company are as under:

Financial Year	Date of	Tentative Date
	Declaration	for transfer to
		IEPF
2017-18 (Final)	31.07.2018	06.09.2025
2019-20 (Interim)	06.02.2020	14.03.2027

Members who have not encashed their dividend so far in respect of the aforesaid periods are requested to make their claims to Maheshwari Datamatics Private Limited, Registrar and Share Transfer Agent of the Company (''RTA'') or to the Company Secretary of the Company, at the Company''s Registered Office/ Corporate Office, well in advance of the above due dates. Pursuant to the provisions of IEPF Authority (IEPF) (Accounting, Audit, Transfer and Refund) Rules, 2016 (''IEPF Rules''), the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on September 28, 2023 (date of the last AGM) on the website of the Company at www. starcement.co.in and also on the website of the Ministry of Corporate Affairs at www.mca.gov.in.

The Interim Dividend declared for the Financial year 201516 and the underlying equity shares of the Company were transferred to the IEPF Authroity. The details are available on the web site of the Company at www.starcement.co.in

Further, the fractional shares entitlement account on which the amount has not been paid or claimed for seven (7) consecutive years or more shall be transferred to the IEFP Authority as notified by the Ministry of Corporate Affairs. Accordingly, the fractional share entitlement account for the FY 2017-18 which was unpaid for seven consecutive years aggregating to H50,460.50 will be transferred by the Company to the IEPF Authority after following the required provisions of the Rules on or after 06^th September, 2024.

The shareholders whose dividend/Fractional share amount/shares have been/ will be transferred to the IEPF Authority may claim the shares or apply for refund by making an application to the IEPF Authority by following the procedure as detailed in the IEPF Rules and as enumerated on the website of IEPF Authority at http:// www.iepf.gov.in/IEPF/refund.html.

ANNUAL RETURN

In terms of requirement of section 134 (3) (a) read with Section 92(3) of the Companies Act, 2013, the Annual return of the Company has been placed on the Company''s website and can be accessed at the web link: https://www.

starcement.co.in/upload/images/files/Annual-Return-

FY-23-24.pdf

MEETINGS OF THE BOARD

During the year four (4) Board Meetings and four (4) Audit Committee Meetings were convened and held on 19^thMay, 2023, 08^th August, 2023, 9^th November, 2023 and 07^thFebruary, 2024 respectively. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. The details of the Board meeting and the Committee meeting are provided in the Corporate Governance Report.

MEETINGS OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent Directors was held on 27^th March, 2024 wherein the performance of the Non-Independent Directors and the Board as a whole, its committees were reviewed. The Independent Directors at their meeting also inter alia assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.

COMMITTEES OF THE BOARD

The composition and terms of reference of the Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee, Risk Management Committee and Finance Committee have been furnished in the Corporate Governance Report forming part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee and Nomination and Remuneration Committee.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Whistle Blower Policy/ Vigil Mechanism as required under Section 177 of the Companies Act, 2013 and as per Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). The Vigil (Whistle Blower) mechanism provides a channel to the employees and Directors to report to the management, concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said policy may be referred to at the Company''s website at the web link: https://www.starcement.co.in/ upload/images/files/Whistle-Blower-Policy-4.pdf

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT EMPLOYEES

The Board has framed a Remuneration Policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management Employees. The remuneration policy aims to enable the Company to attract, retain and motivate highly qualified members for the Board and at other executive levels. The remuneration policy seeks to enable the Company to provide a well-balanced and performance-related compensation package, taking into account shareholder interests, industry standards and relevant Indian corporate regulations. The details on the same are given in the Corporate Governance Report. The said policy may be referred to at the Company''s website at the web link: https: //www. starcement. co .in/upload/images/files/ Remuneration-Policy.pdf

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Listing Regulations, your Board has framed and adopted a Dividend Distribution Policy. The object of the policy is to sharing profit of the Company with the shareholders appropriately and also to ensure funds are available for the growth of the Company. The policy inter alia describes the circumstances under which the shareholders may or may not expect dividend, the financial parameters that shall be considered while declaring dividend, internal and external factors that shall be considered for declaration of dividend, policy for utilization of retained earnings and the parameters with respect to different classes of shares for the purpose of declaration of dividend. The said policy may be referred to at the Company''s website at the web link: https://www. starcement.co.in/upload/images/files/Dividend-policy.pdf

CODE OF CONDUCT

With intent to enhance integrity, ethics & transparency in governance of the Company your Company had adopted a Code of Conduct for Directors and Senior Management Personnel. The Code has been displayed on the Company''s website www.starcement.co.in

COMPLIANCE WITH THE SECRETARIAL STANDARDS AND INDIAN ACCOUNTING STANDARDS (IND AS)

The Company has complied with the applicable Secretarial Standards as recommended by the Institute of Company Secretaries of India. The Company has also complied with all relevant Indian Accounting Standards (Ind AS) referred to in section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards) Rules, 2015 while preparing the financial statements.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

Q In the preparation of Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures, if any;

Q The Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2024 and of the profit of the Company for the year under review;

Q The Directors 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;

Q The Directors have prepared the annual accounts on going concern basis;

Q The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Q The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

AUDITORS & AUDITORS'' REPORT

M/s Singhi & Co., Chartered Accountants (Firm Registration Number: 302049E), Statutory Auditors of the Company have been appointed by the members at the Twenty-First Annual General Meeting of the members of the Company and shall hold office for a period of 5 years from the date of such meeting held on 27^th September, 2022.

The Statutory Auditors'' Report "with an unmodified opinion", given by M/s. Singhi & Co., on the Standalone and Consolidated Financial Statements of the Company for the Financial Year ended 31^st March, 2024, is appended in the Financial Statements forming part of this Annual Report.

The notes to the accounts referred to in the Auditors'' Report are self-explanatory and, therefore, do not call for any further comments.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its manufacturing activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, appointed Messrs B. G. Chowdhury & Co., Cost Accountants, (Firm Registration Number: 000064) as Cost Auditors of the Company for the financial year ended 31^st March, 2024 in the Board Meeting held on 19^thMay, 2023. The remuneration proposed to be paid to them for the Financial year 2023-24, as recommended by audit committee, was ratified in the meeting of shareholders held on 28^th September, 2023.

M/s B. G. Chowdhury & Co., Cost Accountants, (Firm Registration Number: 000064) have expressed their willingness to be re-appointed as Cost Auditors of the Company for ensuing financial year. The Board, on recommendation of the audit committee has reappointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration Number: 000064) as Cost Auditors of the Company for the Financial year 2024-25 subject to ratification of their remuneration by shareholders in the General Meeting of the Company.

As per the provisions of the Companies Act, 2013, the remuneration payable to the Cost Auditors is placed before the Members in a General Meeting for their ratification. Accordingly, a Resolution seeking Members'' ratification for the remuneration payable to M/s. B. G. Chowdhury & Co., Cost Auditors for the Financial year 2024-25 is included in the Notice convening the Annual General Meeting.

The Cost Audit report for the Financial Year 2022-23 was filed with the Ministry of Corporate Affairs on 7^thSeptember, 2023.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. MKB & Associates, a firm of Practising Company Secretaries, (Firm Registration Number: P2010WB042700) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith and marked Annexure-1. The report is self-explanatory and do not call for any further comments.

In terms of Regulation 24A of LODR, Star Cement Meghalaya Limited, a material subsidiary is under secretarial audit and report submitted by the Secretarial Auditors is annexed herewith and marked Annexure -1A. The report is self-explanatory and do not call for any further comments.

REPORTING OF FRAUD

The Auditors of the Company have not reported any fraud as specified under section 143(12) of the Companies Act, 2013.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

As required under Regulation 34 of SEBI Listing Regulations 2015, the Business Responsibility and Sustainability Report of the Company for the financial year ended March 31, 2024 is attached as part of the Annual Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, your Company has not made any investment or provided guarantee or security in connection with a loan to any person exceeding the limit specified in Section 186 of the Companies Act, 2013.

Details of Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in notes to the financial statements.

RELATED PARTY TRANSACTIONS

All related party transactions are entered on arm''s length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. In terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, the particulars of the material contract or arrangement entered into by the Company with related parties as referred to in section 188 in form AOC-2 is attached as Annexure - 2 of this report. However, the details of the transactions with the Related Party are provided in the Company''s financial statements in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

A policy on ''Related Party Transactions'' has been devised by the Company which may be referred to at the Company''s website at the weblink: https://www. starcement.co.in/upload/images/files/Revised-Related-Party-Policy.pdf

RESERVES

During the year under review no amount was transferred to reserves.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated in section 134 (3) (m) of the Act and rules framed there under is mentioned below:

(A) Steps taken toward Conservation of energy:

Q Replacement of overrated Tertiary Crusher motor from 400 kW to 325 kW, resulted in annual savings of 1,22,640 kWh (units).

Q Installation of 45 kW VFD in Material Handling bag filter fans, resulted in annual savings of 69,120 kWh (units).

Q Installation of 132 kW VFD in the bulker unloading compressor, resulted in annual savings of 150,356 kWh (units).

Q Installation of 110 kW VFD in the Mill compressor, resulted in annual savings of 73,669 kWh (units).

Q Replacement of 110 kWh compressor by 55 kW VFD-operated compressor for packer operation, resulted in annual savings of 28,600 kWh (units).

(B) Steps taken toward Technical Absorption:

a. Steps taken towards technical innovation: -

Q Installation of 5.5 kW VFD for the SCL kiln thruster pump to regulate kiln thruster pressure effectively.

Q Installation of the standby VFDs at the coal mill vent fan and Cement Mill-2 dynamic

Q Separator.

Q Installation of 4 kW Variable Frequency Drives (VFDs) in the travel drive of 10 Truck Loaders, helped in reducing breakdowns, and enhanced machine performance.

Q Implemented hardware interlocks in 38 bag filter and air slide fan enclosures, saving 38,304 kWh of power in FY-23-24.

b. Steps taken towards technical absorption: -

Q Installation of Solid-State Relays (SSRs) in place of power contactors for the hydraulic motor drive of Truck Tipplers No-1 & 2, resulting in smoother operation and reduced downtime.

Q Replacement of 3 kW drum motors with 2.2 kW Geared Motors, resulting in fewer breakdowns of Truck Loaders.

Q Frequent tripping of Intelligent Motor Control Centre (IMCC) drives due to communication failures mitigated by replacing 100mbps switches with 1Gbps switches, leading to improved communication speed and eliminating further stoppages.

c. Steps taken towards technical adoption: -

Q Upgradation of the coal mill static separator with a dynamic separator to enhance performance.

Q Installed a 500 KVAR / 200/100 KVAR APFC capacitor bank panel in LT loads and distribution transformers, improving the power factor from 0.989 to 0.994. This resulted in an additional rebate of H8.97 lakhs in the financial year 23-24.

Q The modification of the 220-volt AC power line communication system in the packer, using the Devolo Kit, has effectively reduced the occurrence of frequent communication faults within the power circuit

Q Installation of on-line cleaning of lubrication oil unit in Mill main gear box and Roller lubrication system resulted in increased life of oil by 2 years.

Q The Company has developed a Research & Development cell for carrying out R&D Projects in the plant with specific objective of development of advanced systems for quality improvement. During the year under review, your Company incurred Capital expenditure of H9.35 Lakhs (PY. H6.70 Lakhs) and Revenue Expenditure of H0.37 Lakhs (PY H22.74 Lakhs) in Research & Development.

During the period under review, Foreign

Exchange Earning was NIL (Previous Year - NIL)

and the Foreign Exchange Outgo was H808.43

Lakhs (Previous Year H2,597.86 Lakhs).

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES (CSR)

Star Cement Ltd has continually been the precursor of CSR performance in North-Eastern and Eastern region of the country. The Company''s CSR policy mainly focuses on the need based sustainable holistic development of the neighbouring society since the day of its commencement. The Company''s social responsibility approach is offering several community welfare services in the ground of Health, Education, Livelihood, Environment and Biodiversity, Rural infrastructure development and emergency response for the local inhabitants of plant operational areas throughout the year 2023-24 to progress the excellence and standard of living.

Your Company is always pioneer in various social welfre activities and has been undertaking several welfare activities for the benefit of the community at large. Towards achieving long term stakeholder value creation, the Company continues to respect the interests of and be responsive towards our key stakeholders -the communities, especially those from socially and economically backward Groups, the underprivileged and marginalized. Your Company''s CSR activities always goes beyond the statutory requirements for the reasons excess contributions made every year are never set off against the CSR liability.

Pursuant to Section 135 of the Companies Act, 2013 read with Schedule VII thereof and Rules made thereunder, your Company''s social responsibility policy is offering number of community welfare services in the field of Health, Education, Livelihood, Environment and Biodiversity, Rural infrastructure development and emergency response etc., for the local inhabitants of plant operational areas during the year 2023-24 to improve the quality and standard of living. Your Company undertook various activities during the year 2023-24 under review in line with its CSR Policy.

The composition of CSR Committee of your Company, attendance at the said Meeting, terms of reference of the CSR Committee and other relevant details have been provided in the Corporate Governance Report forming part of the Annual Report. The CSR Committee has confirmed that the implementation and monitoring of CSR Policy is in conformity with CSR objectives and policy of the Company and in compliance with Section 135 of the Companies Act, 2013.

Your Company''s Policy on Corporate Social Responsibility can be accessed on the Company''s website at https:// www.starcement.co.in/upload/images/files/CSR-Policy-2021-1.pdf

Annual Report on CSR as required to be annexed in terms of requirement of Section 135 of Companies Act, 2013 and rules framed thereunder is annexed herewith and marked Annexure- 3.

EVALUATION OF THE BOARD''S PERFORMANCE

In accordance with the requirements of the Companies Act 2013, the performance evaluation of the Board was carried out during the year under review. The Board follows a formal mechanism for the evaluation of the performance of the Board as well as Committee. The evaluation reflected the overall engagement of the Board and the Committee.

A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance etc.

The Nomination and Remuneration Committee at its meeting established the criteria based on which the Board evaluate the performance of the Directors.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders, etc. The performance evaluation of the Non-Independent Directors and Board as a whole was also carried out by the Independent Directors.

The Directors had expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The tenure of Mr. Sajjan Bhajanka, Mr. Rajendra Chamaria, Mr. Sanjay Agarwal Mr. Prem Kumar Bhajanka, Managing Directors of the Company and Mr. Pankaj Kejriwal, Executive Director of the Company were due to expire on 31^st March, 2024. On the recommendation of Nominaton & Remuneration Committee, the Board at its meeting held on 08^th August, 2023, re-appointed Mr. Sajjan Bhajanka, Mr. Rajendra Chamaria, Mr. Sanjay Agarwal Mr. Prem Kumar Bhajanka as the Managing Directors of your Company and Mr. Pankaj Kejriwal, as Executive Director of the Company for further period of three years with effect from 1^st April, 2024 till 31^st March, 2027. The Company in its Annual General Meeting held on 28^thSeptember, 2023 has taken approval of the shareholders for the above re-appointments.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors in its meeting held on 8^th August, 2023, appointed Mr. Tushar Bhajanka (DIN: 09179632) as an Additional Director in Executive category and designated as the Deputy Managing Director of the Company with effect from 8^thAugust, 2023 for a period of 3 years till 7^th August, 2026. In terms of Regulation 17(1C) of the Listing Regulations, the listed entity is required to obtain approval of the shareholders for the appointment of new Director at the next General Meeting or within a time period of three months from the date of appointment, whichever is earlier. Accordingly, The Company in its Annual General Meeting held on 28^th September, 2023 has taken approval of the shareholders for the above appointment.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors in its meeting held on 9^th November, 2023, appointed Mr. Keshav Bhajanka (DIN: 03109701) as an Additional Director in Non-Executive category of the Company with effect from 9^th November, 2023. In terms of Regulation 17(1C) of the Listing Regulations, the listed entity is required to obtain approval of the shareholders for the appointment of new Director at the next General Meeting or within a time period of three months from the date

of appointment, whichever is earlier. Accordingly, The Company by way of special resolution through Postal Ballot dated 19^th January, 2024 has taken approval of the shareholders for the above appointment.

In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Brij Bhushan Agarwal (DIN: 01125056) and Mr. Prem Kumar Bhajanka (DIN: 00591512) will retire by rotation and being eligible, offer themselves for re-appointment. In view of their considerable experience, your Directors recommend the re-appointment of Mr. Brij Bhushan Agarwal and Mr. Prem Kumar Bhajanka as Directors of the Company.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and they have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and the Listing Regulations. Mr. Nirmalya Bhattacharyya, Mrs. Ibaridor Katherine War, Mrs. Plistina Dkhar, Mr. Amit Kiran Deb, Mr. Deepak Singhal, Mr. Vivek Chawla, Mr. Jagdish Chandra Toshniwal and Mr. Ramit Budhraja are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in section 149 of the Act and the Rules made thereunder and the Listing Regulations about their status as Independent Director of the Company.

Your Board of Directors formed opinion that the Independent Directors of the Company are maintaining highest standard of integrity and possessing expertise, requisite qualifications and relevant experience in the fields of Administration, General management, Accounts & Finance, Audit , Internal Audit, Taxation, Risk, Board procedures, Governance etc., for performing their role as Independent Directors of the Company. Regarding proficiency, all Independent Directors have registered themselves in the Data Bank maintained with the Indian Institute of Corporate Affairs (IICA), Manesar. In terms of Section 150 of the Act read with Rule 6(4) of the Companies (Appointment & Qualification of Directors) Rules, 2014, the Independent Directors are required to undertake online proficiency self- assessment test conducted by the IICA within a period of 2 (two) years from the date of inclusion of their names in the data bank. Mr. Amit Kiran Deb, Mrs. Ibaridor Katherine War, Mrs. Plistina Dkhar, Mr. Deepak Singhal, Mr. Vivek Chawla, Mr. Jagdish Chandra Toshniwal and Mr. Ramit Budharaja, Independent Directors are exempted from qualifying ''online proficiency test'' due to their relevant experience in listed companies and the Companies with Paid up equity Capital is H10 crores and more. Mr. Nirmalya Bhattacharyya had appeared in ''online proficiency test'' within the period of 2 (two) years from

the date of inclusion of his names in the data bank and have successfully qualified the test.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

In order to enable the Independent Directors to perform their duties optimally, the Board has devised a familiarization programme for the Independent Directors to familiarize them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. They are periodically updated about the development which takes place in the Company. Periodic presentations are made at the Board and Committee Meetings, updates of the Company, business strategy and risks involved. Site visits are arranged, whenever required. At the time of appointment of an Independent Director, the Company issues a formal letter of appointment setting out in detail, the terms of appointment, duties, responsibilities and commitments etc. The familiarization program is available on the Company''s website under the web link:

https://www.starcement.co.in/upload/images/files/

Familiarization-Programme.pdf

SUBSIDIARIES AND ASSOCIATE COMPANY

M/s. Star Cement Meghalaya Limited, M/s. Star Century Global Cement Private Limited, M/s. Star Cement (I) Limited (formerly, Star Cement Lumshnong Limited) and M/s. Star Cement North East Limited continue to remain subsidiaries of the Company.

Star Cement Meghalaya Limited, a material subsidiary, is engaged in manufacturing of Cement Clinker and has a Clinkerization plant with an installed capacity of 1.8 MTPA. During the year under review, the Company manufactured of 20,44 837 MT clinker as against 19,62,393 MT in FY 2022-23.

Star Cement North East Limited, a subsidiary Company having 2 MTPA Cement Grinding plant has started its commercial operation on the 12^th Day of March, 2024, the Company manufactured 88,328 MT of cement during the year.

Star Century Global Cement Private Limited a wholly-owned subsidiary in Myanmar is yet to commence its operations.

M/s. Star Cement (I) Limited (formerly, Star Cement Lumshnong Limited) subsidiary is yet to start commercial operations.

In terms of the Scheme of Amalgamation filed before the Hon''ble National Company Law Tribunal, Guwahati bench by M/s. Meghalaya Power Limited, Megha Technical & Engineers Private Limited and NE Hills Hydro Limited (Transferor Companies) and Star Cement Meghalaya Limited (Transferee Company) and as per order passed by the Hon''ble National Company Law Tribunal dated

10^th May, 2024, the respective Transferor Companies have been merged with the Star Cement Meghalaya Limited. The Scheme of Amalgamation has been effective on 20^thMay, 2024 with effect from the Appointed date i.e. 01^stApril, 2023.

CHANGES IN NATURE OF BUSINESS, IF ANY

There has not been any change in the nature of business.

AUDITED FINANCIAL STATEMENTS OF THE COMPANY''S SUBSIDIARIES

Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement for the year ended 31^st March, 2024 for each of the Company''s subsidiaries viz. Star Cement Meghalaya Limited (SCML), Star Century Global Cement Private Limited (SCGCPL), Star Cement (I) Limited (formerly, Star Cement Lumshnong Limited) and Star Cement North East Limited are annexed in the Form AOC - 1 and marked as Annexure-4.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company have been prepared in accordance to requirements of the Companies Act, 2013 and Ind AS as prescribed by the Institute of Chartered Accountants of India and has been included as a part of this Annual Report.

The detailed financial statements and audit reports of each of the subsidiaries of the Company are available for inspection at the Registered Office of the Company during office hours between 11:00 A.M. and 01:00 P.M. The Company will arrange to send the financial statements of the subsidiaries upon written request from a shareholder to the registered address of the said shareholder.

DEPOSITS

During the year under report, the Company has not accepted any deposits from public or from any of the Directors of the Company or their relatives falling under ambit of Section 73 of the Companies Act, 2013.

SIGNIFICANT MATERIAL ORDERS PASSED BY THE COURTS OR REGULATORS

(i) The Company (along with present and former Directors, Key Managerial Personnel and former Statutory Auditors) had submitted applications with the Registrar of Companies, North Eastern Region, under Section 441 of the Companies Act, 2013 (the "Act") for compounding of certain alleged offences u/s 134, 129 read with AS-4, 92 and 143(3) of the Companies Act, 2013. Accordingly, The Regional Director (North Eastern Region), vide its orders dated February 6, 2024, has compounded the alleged

offences. The total compounding fees of H14,50,000 (Rupees Fourteen Lakhs Fifty Thousands), which comprises of H2,00,000 (Rupees Two Lakh) in respect of the Company and H50,000 (Rupees Fifty Thousand) each of the present and former Directors, Key Managerial Personnel and former Statutory Auditors has been paid.

(ii) In respect of demand notice dated 19^th February, 2020 received by the Company from Director of Mineral Resources, Meghalaya, for payment of royalty, MEPRF, VAT/GST for H4,184.06 Lakhs in pursuance to the National Green Tribunal (NGT) order dated 1701-2020 passed in O.A. No. 110(TCH)/2012 for alleged illegal coal procurement. By passing the said order NGT has accepted the Recommendation of the 5^thInterim Report of the Independent Committee set up by NGT, which has suggested imposition of penalty on Cement Companies and Thermal Power Plants in Meghalaya.

The Company did not purchase any illegal coal and had complied with all disclosure requirements of the various Government Departments. The Report of NGT Committee has been founded on the basis of assumptions and views of the Committee and not on hard facts. Further to note, that neither the Company has been issued a show-cause nor any opportunity of being heard was given to the Company before submitting the Interim reports by the Independent Committee to NGT. Even NGT has not served any notice on the Company before passing the impugned order dated 17-01-2020 which is clear violation of principles of natural justice.

Accordingly, the Company had preferred an appeal, being C.A. No.3280 of 2020, before the Apex Court. The Apex court vide it''s order dated 02.05.2023 restored the proceeding in relation to the Company back to the file of the NGT, at the stage, at which they stood prior to the passing of the judgement dated 17.01.2020.

Subsequently the matter was transferred to the NGT, Eastern Zone Bench and re-numbered as OA No. 154/2023/EZ. The Company has appeared in the case through it''s counsel and filed Affidavit in the case and the said case is now listed for hearing before the NGT, Kolkata on 02.08.2024 . (Refer Note No 46(a) of Notes to Accounts).

(iii) During the previous year the Company had received a demand notice dated 20^th March, 2023 from the Divisional Mining Officer (DMO), Directorate of Mineral Resources, Meghalaya, Jowai towards outstanding dues of royalty & Cess on Coal,

Sandstone, Clay and Shale procured/consumed by the Company in certain specific periods between F.Y. 2009-10 to F.Y. 2022-23 amounting to H2650.31 Lakhs (including H1552.61 Lakhs towards Penal Interest). As per the provisions of the Mines and Minerals (Development and Regulation) Act, 1957, the liability for payment of royalty in respect of any mineral removed/ consumed from the mining lease arises on the holder of the mining lease and not on the purchaser of such mined minerals. Hence, there is no obligation of the Company to pay royalty/cess in case the minerals are procured from third party vendors. On 27^th February 2024, the Office of DMO has issued the no dues certificates for payment of Royalty and Cess on Shale purchased from Local suppliers during the period from Dec, 2019 to Jan, 2024, and as such, the Department has admitted that there is no liability of the Company towards payment of Royalty and Cess on Shale. Accordingly the company has written back Cess liability on Shale lying in the books of accounts amounting to H47.96 lakhs during the year and reduced contingent liability pertaining to Royalty and cess on Shale amounting to H601.12 lakhs (including penal interest amounting to H260.07 lakhs). However, as an abundant precaution, the Company has kept liability towards Royalty & Cess on others mineral products amounting to H439.92 Lakhs. Since the liability to pay royalty & Cess itself is not applicable to the Company, hence provision for differential amount of demand amounting to H268.77 Lakhs and penal interest amounting to H1292.54 Lakhs has not been provided and shown as contingent liability. The Company shall contest the above demand and based on the legal opinion obtained in this regard, it believes the said demand raised by the DMO is not tenable and the matter shall be disposed off in the favour of the Company. (Refer Note No 46(b) of Notes to Accounts).

Other than the aforesaid, there have been no significant and material orders passed by the Courts/ Regulators impacting the going concern status and future operations of the Company.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes or commitments have occurred between the end of the financial year and the date of this Report which affect the financial statements of the Company in respect of the reporting year.

CREDIT RATINGS

Your Company enjoys a sound reputation for its prudent financial management and its ability to meet financial obligations. On the request of the Company ICRA Limited, has withdrawn its working capital ratings assigned to the Company''s short term and the long term fund based limits. The CRISIL ratings for the Long term and Short Term fund based limits are in force. CRISIL has affirmed the short term fund based limits rating as CRISIL A1 (pronounced as CRISIL A One Plus). CRISIL Ratings for the long term fund based limits has been upgraded from ''CRISIL AA-/Positive'' (pronounced CRISIL double A minus) to ''CRISIL AA/Stable'' (pronounced CRISIL double A).

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Board of Directors of the Company on the recommendation of the Audit Committee, appointed an inhouse team of employees headed by Mr. Anik Chakrabarty, Chartered Accountant as the Internal Auditors of the Company to conduct Internal Audit for the Financial Year 2023-24. The Internal Auditors monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations, if any, along with corrective actions thereon are presented to the Audit Committee of the Board.

INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design or operations were observed. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

DETAILS OF SIGNIFICANT CHANGES (I.E., CHANGES OF 25% OR MORE) IN KEY FINANCIAL RATIO AND CHANGE IN RETURN ON NETWORTH ALONGWITH DETAILED EXPLANATIONS

Key Financial ratios	F. Y. 2023-24	F. Y. 2022-23	% change	Explanation for Significant Changes
Debtors Turnover ratio	27.43	23.15	18.47	Increase on account of higher sales
Inventory Turnover ratio	20.03	19.81	1.11	NA
Interest Coverage ratio	33.48	27.09	23.58	Increase on account of higher net profit achieved during the year.
Current ratio	0.51	0.96	(46.46)	NA
Debt Equity ratio	0.05	0.03	113.89	Change is due to increase in borrowings during the year.
Operating Profit Margin (%)	12.16	9.65	26.01	Change on account of higher profit before interest and tax
Net Profit Margin (%)	7.68	6.26	22.74	Change on account of higher Profit durig the year.
Return on Net Worth (%)	14.03	11.87	18.15	NA

MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES

The disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 along with a statement containing particulars of employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith and marked Annexure- 5 and forms part of this report.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

There was no application made or proceeding pending against the company under the Insolvency and Bankruptcy Code, 2016, during the year under review.

DETAILS OF DIFFERENCE IN VALUATION

The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Act") and has constituted the Committee with internal and external members. We affirm that adequate access has been provided to any complainants who wish to register a complaint under the policy. No complaint was received during the year.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements as stipulated under the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). A separate section on corporate governance, along with a certificate from the auditors confirming the compliance, is annexed and forms part of the Annual Report. This certificate will be forwarded to the Stock Exchanges along with the Annual Report of the Company.

CHIEF EXECUTIVE OFFICER (CEO) /CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI), the CEO/CFO certification has been submitted to the Board and a copy thereof is contained in this Annual Report.

RISK MANAGEMENT

Risk management refers to the practice of identifying potential risks in advance, analyzing them and taking precautionary steps to reduce the risk. The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.

HUMAN RESOURCE DEVELOPMENT & INDUSTRIAL RELATIONS

As the custodian of Star Cement''s values and aspirations, Human Resource department remains steadfast in its commitment to fostering a positive and engaging work environment that propels us towards our collective goals.

Throughout the past year, we have dedicated ourselves to initiatives aimed at nurturing our most valuable asset -people. Our efforts have revolved around Talent Management, Training & Development, Reward & Recognition, HR Automation, and Employee Wellbeing, all in alignment with the overarching vision of our company.

With an objective of nurturing talent and building talent pipeline, a leadership development program PACE (People Advancement - Curating Excellence) was launched where a cohort of high potential employees were identified, assessed and taken through a leadership development journey by way of coaching, mentoring and assigning action learning projects.

To foster a learning culture and leverage expertise & knowledge, we rolled out Star Gurukul program in which internal talents who are subject matter experts were identified, groomed and certified as "Trainers" to share their knowledge and skills to the larger team.

Recognizing the vital role of employee engagement in our success, we introduced initiatives like the "Employee of the Quarter" program and integrated gratitude and appreciation into our workplace culture through ''Thank You'' cards.

In line with our theme of "Better & Faster," we streamlined HR operational processes through automation, ensuring efficiency and data-driven decision-making across the employee lifecycle.

Our commitment to employee wellbeing remains unwavering. This year, we prioritized health with the introduction of Pre-Employment and Annual Health Check-ups, alongside various wellness activities like zumba classes and yoga sessions.

In our pursuit of hiring the best talent, we introduced graded psychometric assessments to ensure cultural fit and alignment with Star Cement''s ethos.

With proactive measures taken to address welfare-related concerns across all plant locations our employee relations have remained robust.

As we look ahead, we wish to continue to uphold the values that define us and strive for excellence in all our endeavours.

Industrial Relations have been effective with several interventions & good practices. During the year gone by, there has not been any material changes in human resources and industrial relations as proactively employee welfare related aspects across plant locations were addressed and taken care of.

AWARDS AND ACCOLADES

During the year Star Cement was awarded the prestigious "Entrepreneur Influencer Award 2023 in Best Use of Video Content" for the Brand Journey video of Star Cement Ltd which was showcased during "Star Sitaron ka Milan 2023 Annual Dealers Conference Meet" held at Pattaya, Thailand. This year Star Cement has been awarded Brand of the Decade 2024 by BARC Asia in cement category nationwide.

GREEN INITIATIVES IN CORPORATE GOVERNANCE

Ministry of Corporate Affairs has permitted Companies to send copies of Annual report, Notices, etc., electronically to the email IDs of shareholders. Your Company has arranged to send the soft copies of these documents to the registered email IDs of the shareholders, wherever applicable. In case, any shareholder would like to receive physical copies of these documents, the same shall be forwarded upon receipt of written request in this respect.

The Ministry of Corporate Affairs has taken ''Green Initiative in the Corporate Governance'' by allowing paperless compliances by the Companies and has issued circulars stating that service of notice/documents including Annual Report can be sent by e-mail to its members for the financial year 31^st March, 2024. A newspaper advertisement in this regard is being published.

Your Company prefers e demand module for transportation of material through Indian Railways which helps for carbon saving. It is the amount of saving of carbon emission in Tonnes of CO2 on account of transportation of goods by railways instead of road.

CAUTIONARY STATEMENT

Statements in this report describing the Company''s objectives, expectations or predictions, may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Company''s operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in Government policies and tax laws, economic development of the country, our business, the businesses of our customers,

vendors and partners and other factors which are material to the business operations of the Company.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their deep sense of gratitude to Banks, Central and State Governments and their departments and the local authorities, customers, vendors, business partners/ associates for their continued guidance and support.

to them. Last but not least, your Directors express their gratitude to the shareholders of the Company for reposing their confidence and faith in the Management of the Company and look forward for their support in future.

For and on behalf of the Board of Directors

Sajjan Bhajanka

Place: Lumshnong Chairman

Date: 22^nd May, 2024 (DIN: 00246043)

Mar 31, 2023

Your Directors have pleasure in presenting Twenty-Second Annual Report of the Company together with the Audited Standalone & Consolidated Balance Sheet as at 31st March, 2023 and the Statement of Profit & Loss for the year ended on that date.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the financial year ended 31st March, 2023 as compared to the previous financial year are as under:

(Rs. in Lakhs)
Particulars	Consolidated		Standalone
	FY 22-23	FY 21-22	FY 22-23	FY 21-22
Total Income	2,75,692.95	2,25,519.07	2,73,120.85	2,21,913.06
Profit before Interest, Depreciation and Tax and exceptional items	52,047.47	37,862.33	33,886.92	25,488.56
Less: Finance Cost	969.50	1,334.03	1,251.13	1,236.19
Less: Depreciation and Amortization Expense	13,111.22	12,162.95	7,751.63	7,214.85
Profit before exceptional items and tax	37,966.75	24,365.35	24,884.16	17,037.52
Exceptional Items	-	-	-	-
Profit before Tax	37,966.75	24,365.35	24,884.16	17,037.52
Tax expense:
- Current Tax	6,721.57	3,951.72	4,397.01	2,907.27
- Tax for earlier years	(759.74)	(2.46)	(772.82)	(4.92)
- Deferred Tax	7,244.51	(4,261.39)	4,857.92	(3,497.00)
Net Profit after Tax	24,760.41	24,677.48	16,402.05	17,632.17
Other comprehensive income for the year	33.76	(14.17)	30.94	2.33
Total comprehensive income for the year	24,794.17	24,663.31	16,432.99	17,634.50
Net profit attributable to:
Owners of the Company	24,760.41	24,677.48	-	-
Non-controlling interest	-	-	-	-
Total	24,760.41	24,677.48	-	-
Other Comprehensive Income attributable to:
Owners of the Company	33.76	(14.17)	-	-
Non-controlling interest	-	-	-	-
Total	33.76	(14.17)	-	-
Total Comprehensive Income attributable to:
Owners of the Company	24,794.17	24,663.31	-	-
Non-controlling interest	-	-	-	-
Total	24,794.17	24,663.31	-	-

OPERATIONAL REVIEW

India accounted for 7% of global cement installed capacity and ranked second in the world. India has a high quantity and quality of limestone deposits and having a large untapped cement market therefore, cement industry promises huge potential for growth in the country.

Currently, Installed capacity of cement in India is 622 MTPA with production of 362 MTPA. The Government have been supporting cement industry in various ways.

As per Union Budget for FY 23-24, the Government of India has allocated USD 26.74 Bn in developing road infrastructure and USD 18.84 Bn in railways which is expected to enhance cement demand of the country.

During the year under review, your Company has manufactured 7,59,263 MT. of Cement Clinker as against 5,20,517 MT. recorded during the FY 21-22. Companyâs subsidiary M/s. Star Cement Meghalaya Limited has produced 19,62,393 MT. of Clinker as against 16,54,582 MT. during the FY 21-22. On consolidated basis total clinker production during the year was at 27,21,656 MT. as against 21,75,099 MT. during FY 2122. Your Company recorded overall growth in its performance during the year.

In terms of capacity utilisation, clinkerisation unit of your Company was able to utilise 95.87% of its installed capacity as against 65.72% during the FY 21-22. M/s. Star Cement Meghalaya Limited has fully utilised its capacity during

the FY 22-23 as against 88.01% during the FY 21-22. On consolidated basis, clinkerisation units fully utlilized its capacity during the FY 22-23 as against 85.60% during FY 21-22.

Your Company has been able to maintain the performance on grinding front too. During the year under review, total cement production on consolidated basis was at 40,56,452 MT. as against 34,05,671 MT. during the FY 21-22.

Similarly, your Company has been able to achieve sales volume of 40,13,643 MT. of Cement as against 33,92,185 MT. during the previous financial year.

During the year your Company has obtained the Envirtonment clearance for 42 hectres limestone mines Your Company has implemented SAP in its business system which facilitates seamless and speedy data processing and flow of information with accountability.

During the year, your Company has taken various initiatives towards the cost cutting. In order to curb escalation of costs, the Company appointed Boston Consulting Group. Actions are being taken as per their advice. This year its efficacy has also been seen.

UPCOMING PROJECTS

Your Companyâs new projects for establishing a 3 MTPA clinkerisation plant and 10.8 MW WHRB at Lumshnong is underway. Star Cement North East Limited, a subsidiary Company initiated for establishing 2 MTPA cement plant in Sonapur, Assam and Star Cement (I) Limited, a subsidiary Companyâs project for 2 MTPA cement plant in Silchar with Railway sliding are in progress. Commissioned and Trial run for Star Cement Meghalaya Limited, a subsidiary Companyâs WHRB project for 12.5 MW are in progress. Upon completion of the projects overall strength and position of your Company in cement market will be improved.

DIVIDEND

The Board of Directors of your Company, after considering holistically the requirement of funds for Companyâs and its subsidiaryâs upcoming projects at Lumshnong, Sonapur and Silchar and the relevant circumstances has decided that it would be prudent, not to recommend any Final Dividend for the Financial Year 2022-23 (Previous year NIL).

INDIAN ECONOMY AND OUTLOOK - AT A GLANCE

Inspite of significant economic and geopolitical challenges remain in global environment, Indian economy remains one of the fastest growing economy of the world.

Indian economy posed to recover from contraction due to pandemic, Russian-Ukraine conflict and high rate of inflation. The economy is placing to overall growth across the sectors and expected to position itself to the pre-pandemic growth in

Financial year 2023-24. Capital expenditures undertaken by the Government and the private sectors are leading factors for the growth of Indian economy. Private consumption was high and it has led to increase in production and consumption. GDP growth rate is expected to be within the range of 6-6.8% in coming Financial year 2023-24. The World Bank revised its GDP forecast for India to 6.3 percent which is mainly due to slower consumption and present geopolitical scenario. However, control of inflation within the range be a challenging task. The Reserve Bank of India has implemented certain measures to restraint inflation. Government of India is likely to meet its fiscal deficit target of 5.9 percent of GDP in Financial year 2023-24 in other hand, the current account deficitis projected to narrow to 2.1 percent of GDP from an estimated 3 percent.

As per report of IMF during the Financial year 2022-23, the world economy had suffered setbacks, due to Russia Ukraine war volatile climate changes and its impact, which has increased the cost of food and energy thus escalating prices and increasing rates of interest.

Budget FY 22-23 focused on growth oriented policies and consistency. For which overall countryâs future prospects are looking positive. The Union Budget has allocated 3% and more of GDP to capital expenditures, support for the manufacturing and agricultural sectors, focus on regional connectivity through airports and railways and easing of various compliances, promoting the ''green budgetâ for climate action. These factors will be the key governing factors for inclusive growth of the country in the period to come. Indiaâs strive towards being ''Aatmanirbharâ presents a positive outlook for its future economic prospects focusing on supporting domestic industries and promoting local production. It is anticipated that with these efforts, India will emerge as the worldâs fasted growing economy.

The Government of India has taken certain initiatives to improve economic stability of the country.

With the aim to ''ease of doing businessâ the Government has reduced over 39,000 compliances and decriminalised over 3,400 legal provisions, this will help the Corporates to fous on its core areas and will reduce cost and effectively manage time thus will increase efficiency of business. Governmentâs initiatives e.g., ''Shree Anna Global Hub for Milletsâ programme will help export potential of the agriculatural sector. The Union Budget has made provisions to modernise agriculture through investment in agri-tech, this will help the farmers. In the Budget the Government has announced various measures to promote the manufacturing sector this is expected to increase employment opportunities for the youth.

The Budget made provisions for infrastructure development which will increase the efficiency of goods and services delivery, helping businesses to reach a larger customer base.

Futher, the Government has allocated a capital outlay of '' 2.40 Lakhs Crore for railways, which will help to improve the countryâs transportation infrastructure. The development of transportation infrastructure will provide employment opportunities in the country.

CEMENT INDUSTRY OVERVIEW

Indian cement industry is the second largest in the world. Country has a lot of potential for development in cement sector. Cement demand of the Country has been created through construction boom, pick-up in housing construction (60-63% share of total cement demand) and unprecedented infrastructure spending (~25-30% demand share). Countryâs cement industry promises huge potential for growth. Countryâs cement production capacity stood at 622 MT. p.a. and currently producing 362 Mn tonnes (MT.) in FY 22- 23 estimated. The Indian cement industry is likely to add ~80 Mn tonnes (MT) capacity by FY 23-24. Cement demand to register a CAGR of 9% between FY23-27 through infrastructure investments and healthy housing demand. During the Financial year 2022-23, due to geo political disturbances, Indian cement industry witnessed rise in energy prices which leads to high input costs and also impacted freight cost.

During last quarter 2022-23, domestic and international pet coke and coal prices have been moderated. In other hand imported coal from South Africa and Australia also witnessed a sharp decline of 35% and 44% q-o-q, respectively.

The Indian government is continuously focusing on infrastructure development for economic growth and is striving for full infrastructure coverage to establish 100 smart cities. The government plans to increase the capacity of railways and the facilities for handling and storage to enable the transfer of cement and cut out on transportation costs. These measures are expected to result in an increased construction activity in the country, thereby boosting demand for cement. The National Infrastructure Protection Plan, Bharatmala projects, mission "Home for All," rapid urbanisation, rising rural incomes and historically low interest rates on housing loans are one of the major factors driving long-term cement demand. Government has introduced schemes such as MGNREGA, PM Garib Kalyan Rozgar Abhiyan, PM Awas Yojana etc. which have aided cement demand of the Country.

In the Budget FY 23-24, Government highlighted its intention for the development of infrastructure sector and effective capital expenditure has been increased by 30%. Allocated Capex for Ministry of Road Transport and Highways increased by 25%. Allocation for PM Awas Yogana has been increased which will directly help the cement industry of the country. Budget for Metro cities has also been been increased by 25%. 50 new air ports will be made and 100 critical transport

infrastructure will be developed. The government has allocated a capital outlay of '' 2.40 Lakh Crore for railways, which will help to improve the countryâs transportation infrastructure. This investment in the railway sector will improve regional connectivity and increase the efficiency of goods and services. The Indian Railways aims to rapidly redevelop the infrastructure of more than 1,000 stations under the AMRUT Bharat Station scheme. The governmentâs ''Aatmanirbharâ or self-reliant strategy has been a central theme of the budget, with a focus on supporting domestic industries and promoting local production In view of increasing demand in various sectors such as housing, commercial construction and industrial construction, Countryâs cement industry is expected to reach 420 Mn tonnes per annum (MTPA) by FY 26-27. Eastern states are likely to contribute for the development of the region as their untapped markets are likely to be explored.

EAST & NORTHEAST SCENARIO - GATEWAY OF OPPORTUNITIES

The development of North East remains a major priority of the Government due to its locational and geo political features. For the purpose the Government of India has initiated in various fonts for overall development of North Eastern Region of the country. On a range of indicators, the rate of development now a days is on the rise, with notable improvements in health, education, infrastructure development and industrialisation which contributed in development of socio economic standard of the Region.

The Union budget has approved continuation of Schemes of Ministry of Development of North Eastern Region , with an outlay of '' 12,882.2 Crore, for the balance period of the 15th Finance Commission (FY 22-23 to FY 25-26). Government has announced a package of '' 550 Crore to illuminate border villages of Arunachal Pradesh. North East Gas Grid (NEGG) project of '' 9,265 Crore is underway and will improve economy in NER.

The Prime Ministerâs Development Initiative for North East Region (PM-DevINE) Scheme was announced in the Union Budget FY 22-23. The Scheme with 100% Central funding, will have a total outlay of '' 6,600 Crore for the 4 year period from FY 22-23 to FY 25-26. The projects are in implementation stage.

Numerous efforts have been made for infrastructure development in the region and improving the connectivity of railways, air, telecom, and waterways is the main focus. The outlay for the North East Special Infrastructure Scheme (NESIDS) will be '' 8,139.5 Crore including committed liabilities of ongoing projects. Government also approved '' 1,540 Crore for special packages for Bodo Territorial Council (BTC), Dima Hasao Autonomous Territorial Council (DHATC) and Karbi Anglong Autonomous Territorial Council (KAATC) in

Assam. The Five pillars of the Atmanirbhar Bharat Abhiyan for self-reliant India, namely, Economy, Infrastructutre, System, Vibrant Demography and Demand will get a push through the scheme.

Towrads the objective of improving railway connectivity, '' 51,019 Crore have been spent since 2014 additionally 19 new projects worth '' 77,930 Crore have been sanctioned.

For improving road connectivity, 375 projects worth '' 1.05 Lakh Crore are under way. Under Assam Secondary Road Network Improvement Project, 247 KM have been taken up with an outlay of Rs 3,519 Crore. The road includes Dhodor Ali. 312.5 km road construction have been taken up with an outlay of Rs 3,994 Crore. 135 km road development work in Golaghat District with an outlay of Rs 1,252.14 Crore. Dhubri Fulbari bridge connecting Palashbari with Sualkuchi has been sanctioned for Rs 3,197.20 Crore. Construction of bridge over river Brahmaputra connecting Jorhat with Majuli with a cost of '' 925 Crore has been allocated. There are important flyovers proposed for construction in Guwahati, Jorhat, Amolapatty, Mancotta, Dibrugarh, Silchar (Kalain). Rabindra Bhawan at Guwahati will be reconstructed with 5,000 capacity Auditorium. New medical college will be constructed at Karimganj and Sivasagar.

For improving telecom connectivity in the North East Region from the year 2014''3,466 Crore have been spent.

Air connectivity has also improved massively. In 68 years north east had only 9 airports, it jumped to 17 in a short span of eight years, to further give a boost to air connectivity, '' 2,000 Crore will be invested in civil aviation in North East region.

Waterways are integral to life and culture of North East. Recently '' 6,000 Crore have been sanctioned for the development of national waterway 2 and national waterway 16.

The State government of West Bengal has launched a project ''Rastashree'' for the construction of new roads revamping existing roads. A total of 11,500 km of rural roads has been taken up under the project and the total allocation for the scheme is close to '' 3000 Crore.Indian Government has announced a major investment of Rs 2,550 Crore for the Kolkata Metro Rail in the union budget FY 23-24.

As per Union Budget of Bihar, 157 new nursing college to be established in the state. Centre will spend '' 44,950 Crore in FY 23-24 in Bihar under Bharatmala, a centrally funded project which aims to build a network of roads, highways and expressways across India.

The aforesaid projects will help to increase cement demand in the Region which is likely to have positive impact on the Companies operating in the Region.

Market Development

East India cement demand is expected to grow with a CAGR of 8% to 9% by FY 23-25 estimated. West Bengal and Bihar is the strongest cement consuming state in the eastern-region accounts with more than one-fourth of the region''s total demand at ~19 Mn tonnes and 20 Mn tonnes estimated respectively. Cement demand in West Bengal and Bihar has also grown in the last five years with the help of central government''s ''housing for all'' as well as rapid infrastructure development in rural and urban sectors.

As a strategy, the North East Market continued to be the focus market for your Company. Cement demand was good throughout the year. Demand increased by 9% in NER against an all India average of ~8% estimated.

During the year under review your Company was able to sell overall 4.01 Mn Tonnes. of cement as against 3.4 Mn Tonnes during the FY 21-22.

Overall Cement demand in North East accounted for 13 Mn Tonnes in FY 22-23 as against 12 Mn Tonnes in FY 21-22.

As a market leader in NER your Company has further consolidated dealers and sub dealer''s network. Currently your Company is associated with 1,600 dealers and 12,000 sub dealers.

Company is running mobile application for dealers, influencers, sales, branding and technical team as follows:

i) Star Saathi App for Dealers

ii) Customer Web Portal for Dealers

iii) Digital Displays in Dealer counters

iv) Star Lotus App for Contractors

v) Star Steller App for Engineers

vi) Sales Force Automation App for Sales, Branding and Technical department.

During the year Star Cement Limited continued with the Brand Television Commercial with Akshay Kumar as brand Ambassador, one of the biggest Stars of Bollywood. Association of Akshay Kumar being the brand ambassador caused an uplift on the brand perceptions and has had a positive impact on the saliency of Star Cement as a brand. The Brand Campaign with the key message that Star Cement ready for accepting all challenges depicted with the tagline "Hain Tayyar Hum". The TV commercial is being seen across all major regional news channels in North East, West Bengal, Sikkim & Bihar. The commercial also have presence in the Digital medium and a heavy BTL presence through Surrogate boards, Hoardings, Wall Painting & Dealer/Retailer branding across North East, West Bengal, Sikkim & Bihar. The campaign hence has visible across 360 degrees in multiple mediums. This year we also initiated a digital marketing campaign called "Happy Pic Lucky Pic Contest" for our Facebook and

Instagram users. The total engagement we had was for more than 2 Lakhs users and the campaign helped us to increase our Facebook likes by 17% and Instagram followers by 2700%.

PRODUCTION AND COST DEVELOPMENTS Fly Ash

FYâ23 Target of above 40 Lakh MT resulted in increased production of Portland Pozzolana Cement (PPC) as well. As a result we could consume higher quantity of Fly Ash which is otherwise an environment hazard. In the process we could procure 12.7 Lakh MT of Fly Ash which is 44% higher as compared to FYâ22.

In order to bring down the cost of Fly Ash, various cost saving initiatives were taken throughout the year. Almost all Fly Ash transportation through rakes were done through BOXN after complying with all environmental norms, resulting in lower freight cost. We sourced Bagged FlyAsh at our Siliguri Plant resulted in cost saving & continuous availability of FlyAsh.

Logistics & Freight

The freight cost in NE continued to be impacted in Guwahati - Shillong - Silchar route due to damage on Dwarksuid bridge along Shillong Bypass.

Your Company steered through these challenges to ensure that supplies to Market are ensured while keeping the cost in control. FYâ23 saw Rail Siding getting operational at our Siliguri plant which ensured the market are served with reduced Order to Delivery Time and increase market penetration. Availability of Rake dispatches from Siliguri Plant enabled to dispatch approx. 22,500 MT through rake in the peak month of Marâ23 which is mainly impacted by Potato Harvesting Season.

Logistics Cost Efficiency was further improved through sustained efforts of key initiatives such as month e bidding, PTPK Outlier corrections & levers. Weighted average lead distance continued to remain at 220 KM range.

Integrated Vehicle Access Control cum Logistics Management System (IVL) was soft launched on Decâ22 and which is in process of implementation. Once fully commissioned IVL would completed automate & digitise the End to End Logistics Operation and Bill Processing activities. Your Company has always focused on giving best Logistics services to our customers for timely delivery at the most economical costs & for the same 150 GPS enabled dedicated fleets were inducted for enhanced customer serviceability. These fleet ensured every highest dispatch from Siliguri Plant during the Potato season wherein availability of fleet is a major concern.

Power cost

Meghalaya Power Limited continues to be a wholly owned subsidiary of the Company. During the year under review too, your Company continued to source its power requirement for its Lumshnong unit from its wholly owned subsidiary M/s. Meghalaya Power Limited under long term arrangement for supply of quality power at competitive rates and thus, has been able to reduce dependency on State utility/grid power. Cost of coal has a direct bearing on fuel cost. In view of increasing fuel cost due to increase in price of coal and to optimise the power cost and to reduce dependency on State utility /grid power, your Company has been able to source its power requirement of its Grinding Unit at Guwahati and integrated cement plant at Lumshnong from Indian Energy Exchange (IEX). The blend of sourcing has not only reduced power cost for your Company but also its quality and dependability. By inclining towards procurement of Renewable Power like Solar & Wind from Indian Energy Exchange, your Company has shown its commitment towards promotion of renewable resources and reduction of consumption of electricity generated from fossil based fuel. Use of bio mass and bamboo also helped to reduce dependence on traditional sources.

Coal availability from local sources remained constrained. Sourcing of Coal was done majorly from Coal India Limited (CIL) through FSA and Domestic/ International Traders. The Company also procured good quantity of Coal supplies on spot auctions from CIL during the year, keeping the overall cost in control.

KEY PERFORMANCE HIGHLIGHTS

â¢ Consolidated cement production was at 40.56 Lakhs MT during the year as against 34.06 Lakhs MT during the previous financial year.

â¢ Consolidated net sales at '' 2,575.55 Crore during the year under review as compared to '' 2,090.19 Crore during the financial year 2021-22.

â¢ Consolidated EBIDTA was at '' 520.47 Crore during the year under review as compared to '' 378.62 Crore during the immediate previous financial year after exceptional items.

â¢ Consolidated profit before tax during the year 2022-23 was at '' 379.67 Crore as against a profit of '' 243.65 Crore in the year 2021-22.

â¢ Consolidated Exceptional items during the year was Nil as against Nil recorded in previous year.

OPPORTUNITIES & THREATS, RISKS AND CONCERNS

Marketing strength of Star Cement lies on strong dealers network. Companyâs aggressive marketing strategies and strong branding network also contributed to establish its position as the market leader in the region. Locational advantages helped to procure raw materials at affordable prices.

Companyâs dependence on domestic market and business concentration on regional market for a longer period of time may adversely affect the growth of the Company. Environmental impact and other force majure events may affect the operations of the Company.

Governmentâs budgetary allocation and various initiatives like Make in India, Housing for all, development of Ports, Roads and Highways, dam & irrigation project, National Highway Development programme, Bharat Nirman Yojana, dedicated Freight Corridors, Gauge conversion Projects undertaken by Railways, development in the area of alternative source of energy viz. Hydro and Solar Power and other infrastructure projects is expected to boost Cement and Power Demand of the country. Governmentâs special drive for development of the North Eastern Region has been helping the sustained development of the region.

Competition in the cement industry is very high apart from the large players there are also small players in the market. Competition from the foreign players may lead to tougher competition to the domestic players. This allows limited market share in the industry. Constant increase in diesel costs leads to high transportation cost. Availability of coal at a affordable cost became a constraint factor. In order to tackle the situation your Company optimally utilising its reserved coal and entering Fuel Supply Agreement with various suppliers. Cement Industry is highly fragmented and it is also highly regionalised, transportation of low volume of cement over long distances become uneconomical.

Cement and power industry being majorly dependent upon availability of raw materials at affordable cost. Policies of the Government as well as Central and State Laws may adversely affect the availability of lime stone, coal etc. Any major changes in Governmentâs Environmental and Forest regulations may affect limestone and coal availability to cement plants. However, your Company is sourcing raw materials from alternate sources so that raw materials availability risks is mitigated. Companyâs vast dealerâs network across the States also helping to mitigate the risk. Your Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of Directors of the Company is kept informed about the risk management of the Company. The Board of Directors have formed a Risk Management Committee inter alia, to oversee the risk assessing and mitigation process of the Company and advice the management in this regard.

SHARE CAPITAL

The paid up Equity Share Capital of the Company as on 31st March, 2023 was '' 40,41,80,417 divided into 40,41,80,417 equity shares of '' 1 each. During the year under review, the Company has neither issued any shares with differential voting rights nor granted stock options or sweat equity shares.

SHARES IN SUSPENSE ACCOUNT

Disclosures of the shares lying in Companyâs Unclaimed Shares Suspense Account are given in the Report of Corporate Governance.

INVESTOR EDUCATION AND PROTECTION FUND

As per Companies Act, dividends that are unclaimed/unpaid for a period of seven (7) years from the date of their transfer are required to be transferred to the Investor Education and Protection Fund (''IEPFâ) administered by the Central Government.

The tentative date for transfer of unclaimed and unpaid dividends to the IEPF, declared by the Company are as under:

Financial Year	Date of Declaration	Tentative Date for transfer to IEPF
FY 17-18 (Final)	31st July, 2018	6th September, 2025
FY 19-20 (Interim)	6th February, 2020	14th March, 2027

Members who have not encashed their dividend so far in respect of the aforesaid periods are requested to make their claims to Maheshwari Datamatics Private Limited, Registrar and Share Transfer Agent of the Company (''RTAâ) or to the Company Secretary of the Company, at the Companyâs Registered Office/ Corporate Office, well in advance of the above due dates. Pursuant to the provisions of IEPF Authority (IEPF) (Accounting, Audit, Transfer and Refund) Rules, 2016 (''IEPF Rulesâ), the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on September 27, 2022 (date of the last AGM) on the website of the Company at www.starcement.co.in

and also on the website of the Ministry of Corporate Affairs at www.mca.gov.in.

years or more have been transferred by the Company to the IEPF Authority on 20th July, 2022, after following the required provisions of Rules. 40,158 equity shares of the Company were transferred to the IEPF Authroity on 3rd August, 2022, 6th August, 2022, 12th August, 2022 and 13th August, 2022 respectively. The details are available on the web site of the Company at www.starcement.co.in The shareholders whose dividend/shares have been/ will be transferred to the IEPF Authority may claim the shares or apply for refund by making an application to the IEPF Authority by following the procedure as detailed in the IEPF Rules and as enumerated on the website of IEPF Authority at http://www.iepf.gov.in/IEPF/refund.html.

ANNUAL RETURN

In terms of requirement of section 134 (3) (a) read with Section 92(3) of the Companies Act, 2013, the Annual return of the Company has been placed on the Companyâs website and can be accessed at the web link: https://www.starcement. co.in/upload/images/files/Annual-Return-2022-23.pdf

MEETINGS OF THE BOARD

During the year four (4) Board Meetings and four (4) Audit Committee Meetings were convened and held on 17th May, 2022, 2nd August, 2022, 14th November, 2022 and 3rd February, 2023 respectively. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. The details of the Board meeting and the Committee meeting are provided in the Corporate Governance Report.

MEETINGS OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent Directors was held on 17th March, 2023 wherein the performance of the Non-Independent Directors and the Board as a whole, its committees were reviewed. The Independent Directors at their meeting also inter alia assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.

COMMITTEES OF THE BOARD

The composition and terms of reference of the Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee, Risk Management Committee and Finance Committee have been furnished in the Corporate Governance Report forming part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee and Nomination and Remuneration Committee.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Whistle Blower Policy/ Vigil Mechanism as required under Section 177 of the Companies Act, 2013 and as per Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). The Vigil (Whistle Blower) mechanism provides a channel to the employees and Directors to report to the management, concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct or policy. The mechanism provides for adequate safeguards against victimisation of employees and Directors to avail the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said policy may be referred to at the Companyâs website at the web link: https://www.starcement.co.in/upload/images/ files/Whistle-Blower-Policy-4.pdf

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT EMPLOYEES

The Board has framed a Remuneration Policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management Employees. The remuneration policy aims to enable the Company to attract, retain and motivate highly qualified members for the Board and at other executive levels. The remuneration policy seeks to enable the Company to provide a well-balanced and performance-related compensation package, taking into account shareholder interests, industry standards and relevant Indian corporate regulations. The details on the same are given in the Corporate Governance Report. The said policy may be referred to at the Companyâs website at the web link: https://www.starcement.co.in/upload/images/ files/Remuneration-Policy.pdf

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Listing Regulations, your Board has framed and adopted a Dividend Distribution Policy. The object of the policy is to sharing profit of the Company with the shareholders appropriately and also to ensure funds are available for the growth of the Company. The policy inter alia describes the circumstances under which the shareholders may or may not expect dividend, the financial parameters that shall be considered while declaring dividend, internal and external factors that shall be considered for declaration of dividend, policy for utilisation of retained earnings and the parameters with respect to different classes of shares for the purpose of declaration of dividend. The said policy may be referred to at the Companyâs website at the web link: https://www. starcement.co.in/upload/images/files/Dividend-policy.pdf

CODE OF CONDUCT

With intent to enhance integrity, ethics & transparency in governance of the Company your Company had adopted a Code of Conduct for Directors and Senior Management Personnel. The Code has been displayed on the Companyâs website www.starcement.co.in

COMPLIANCE WITH THE SECRETARIAL STANDARDS AND INDIAN ACCOUNTING STANDARDS (IND AS)

The Company has complied with the applicable Secretarial Standards as recommended by the Institute of Company Secretaries of India. The Company has also complied with all relevant Indian Accounting Standards (Ind AS) referred to in section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards) Rules, 2015 while preparing the financial statements.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

â¢ In the preparation of Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures, if any;

â¢ The Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2023 and of the profit of the Company for the year under review;

â¢ The Directors 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;

â¢ The Directors have prepared the annual accounts on going concern basis;

â¢ The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

â¢ The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

AUDITORS & AUDITORS'' REPORT

Messrs Singhi & Co., Chartered Accountants (Firm Registration Number: 302049E), Statutory Auditors of the Company have been appointed by the members at the

Twenty-First Annual General Meeting of the members of the Company and shall hold office for a period of 5 years from the date of such meeting held on 27th September, 2022.

The Statutory Auditorsâ Report "with an unmodified opinionâ, given by M/s. Singhi & Co., on the Standalone and Consolidated Financial Statements of the Company for the Financial Year ended 31st March, 2023, is appended in the Financial Statements forming part of this Annual Report.

The notes to the accounts referred to in the Auditorsâ Report are self-explanatory and, therefore, do not call for any further comments.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its manufacturing activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, appointed Messrs B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the financial year ended 31st March, 2023 in the Board Meeting held on 17th May, 2022. The remuneration proposed to be paid to them for the Financial year 2022-23, as recommended by audit committee, was ratified in the meeting of shareholders held on 27th September, 2022.

Messrs B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) have expressed their willingness to be re-appointed as Cost Auditors of the Company for ensuing financial year. The Board, on recommendation of the audit committee has re-appointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the Financial year 2023-24 subject to ratification of their remuneration by shareholders in the General Meeting of the Company.

As per the provisions of the Companies Act, 2013, the remuneration payable to the Cost Auditors is placed before the Members in a General Meeting for their ratification. Accordingly, a Resolution seeking Membersâ ratification for the remuneration payable to M/s. B. G. Chowdhury & Co., Cost Auditors for the Financial year 2023-24 is included in the Notice convening the Annual General Meeting.

The Cost Audit report for the Financial Year 2021-22 was filed with the Ministry of Corporate Affairs on 31st August, 2022.

SECRETARIAL AUDIT

Company. The Secretarial Audit Report is annexed herewith and marked Annexure-1. The report is self-explanatory and do not call for any further comments.

In terms of Regulation 24A of LODR, Star Cement Meghalaya Limited, a material subsidiary is under secretarial audit and report submitted by the Secretarial Auditors is annexed herewith and marked Annexure-IA. The report is selfexplanatory and do not call for any further comments.

REPORTING OF FRAUD

The Auditors of the Company have not reported any fraud as specified under section 143(12) of the Companies Act, 2013.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

As required under Regulation 34 of SEBI Listing Regulations 2015, the Business Responsibility and Sustainability Report of the Company for the financial year ended 31st March, 2023 is attached as part of the Annual Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, your Company has not made any investment or provided guarantee or security in connection with a loan to any person exceeding the limit specified in Section 186 of the Companies Act, 2013.

Details of Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in notes to the financial statements.

RELATED PARTY TRANSACTIONS

All related party transactions are entered on armâs length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. In terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, the particulars of the material contract or arrangement entered into by the Company with related parties as referred to in section 188 in form AOC-2 is attached as Annexure-2 of this report. However, the details of the transactions with the Related Party are provided in the Companyâs financial statements in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis,

specifying the nature, value and terms and conditions of the transactions.

A policy on ''Related Party Transactionsâ has been devised by the Company which may be referred to at the Companyâs website at the weblink: https://www.starcement.co.in/ upload/images/files/Revised-Related-Party-Policy.pdf

RESERVES

During the year under review no amount was transferred to reserves.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

(A) Steps taken toward Conservation of energy:

â¢ Cement Mill 1 production, mix & circuit optimised, by which annual power saving achieved.

â¢ Primary Air blower installed VFD by which control the rpm of blower as per process requirement and saved the energy 86,000 kWh per year.

â¢ Due to replacement of existing HPSV lights by LED fittings a total 54,000 kwh power was saved during the year.

â¢ Optimisation of RABH purging operation done which leads to Total power saving of 2,80,000 kwh per year.

â¢ Modification of lighting system of packing plant, Mill Building, Hopper Building from "Always on" in Night hours to need based lighting system. This Lights are controlled from CCR as per requirement.

â¢ Packing plant Packer 1,2 & 3 Bag Filter Fan 30 KW Installation of VFD in place of DOL starter resulted in reduction in power.

â¢ 02 noâs of 37 kW VFD installation in feeding group bag filter fans has reduced power consumption of 94960 KWH per year.

â¢ Mixing of Grinding Aid in cement production started to Increase mill output and decrease Mill SPC (Specfic power consumption). For PPC SPC decrease up to 0.5 Kwh/MT & Mill output increase up to 10 TPH.

â¢ Installed 2 Nos 100 KVAR Capacitor bank at fly ash IMCC and water pump IMCC panels. Improved power factor up to .995.

â¢ Installation of 90 KW VFD in Clinker tippler bag filter fan. Saving of 8.0 KW per hour.

â¢ Installation of VFD in --110 KW in Air compressor. Saving 17 kw per hour.

132 KW VFD in Fly ash Air compressor. Saving of

41 Kw per hour.

Maintained MD below 8000KVA by tripping of noncritical drives of plants.

(B) Steps taken toward Technical Absorption:

a. Steps taken towards Technical innovation:-

i. Installation of 5.5KW VFD for kiln thruster pump to control the pressure of kiln thruster pump.

ii. New Yaskawa GA700 VFD Drives communication with Plant PLC is done by using Modbus communication. Communication was done by changing data type from Hexadecimal to Integer which required data conversion module set up .

iii. Modified the lighting circuits of packing plant truck loader and packer area. When there is no loading Stopping 330 lights. Installed 12 Nos 150 watts emergency lights for illumination during stopping of said lights. Saved 19008 kwh power in last six months.

iv. Optimisation of HAG operation hence reducing the fuel cons by 30%. Annual Saving 7437 ltrs fuel.

b. Steps taken towards technical absorption:-

i. For smooth operation of Truck loaders installed Solid state Relay (SSR) in place of power contactors for Long belt, Loading belt, Luffing drive, this helped in reducing down time of truck loader. Failure rate of Power Contactors are 10 times more than SSR and also cost wise SSR is 30% cheaper

ii. Installation of 3.7 KW VFD in grinding Aid dosing pump. This helped in savings of grinding aid by adjusting dosing from CCR as per process requirement.

iii. Mixing of Grinding Aid in cement started up to 1 Kwh/MT for increase mill output and decrease Mill SPC.

iv. Optimised bag house air purging system. Saved 32400 KWH power in last six months.

v. Providing hardware interlock in 38 Nos bag filter & air slide fanâs enclosures exhaust fans. Saved 38300 KWH in last six months.

vi. Operation of belt conveyor (K21BC4) with modified control circuit of divertor ( K21DG1).

c. Steps taken towards technical adoption :-

i. Development of Test bench PLC set up with spare CPU and modules. This will help in two ways. Firstly, new purchased Module in terms of functionality can be checked. Secondly different communication protocol like Modbus, Profibus and others which caters training to all engineers can be tested.

ii. Use of alternative fuel Pyro oil in place of High-speed diesel.

â¢ The Company has developed a Research & Development cell for carrying out R&D Projects in the plant with specific objective of development of advanced systems for quality improvement. During the year under review, your Company incurred Capital expenditure of '' 6.70 Lakhs (P.Y. '' 8.12 Lakhs) and Revenue Expenditure of '' 22.74 Lakhs (P.Y. '' 52.31 Lakhs) in Research & Development.

During the period under review, Foreign Exchange Earning was NIL (Previous Year - NIL) and the Foreign Exchange Outgo was '' 2,597.86 Lakhs (Previous Year '' 5.24 Lakhs).

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES (CSR)

Star Cement Limited has constantly been the forerunner of CSR activities in north-eastern and eastern region of the country. The Companyâs CSR policy primarily focuses on the need based sustainable holistic development of the neighbouring society since the day of its inception. Towards achieving long term stakeholder value creation, the Company continues to respect the interests of and be responsive towards our key stakeholders - the communities, especially those from socially and economically backward Groups, the underprivileged and marginalised and the society at large. Your Company is always pioneer in various social welfare activities and has been undertaking several welfare activities for the benefit of the community at large. Towards achieving long term stakeholder value creation, the Company continues to respect the interests of and be responsive towards our key stakeholders - the communities, especially those from socially and economically backward Groups, the underprivileged and marginalised. Your Companyâs CSR activities always goes beyond the statutory requirements for the reasons excess contributions made every year are never set off against the CSR liability.

Pursuant to Section 135 of the Companies Act, 2013 read with Schedule VII thereof and Rules made thereunder, your

Companyâs social responsibility policy is offering number of community welfare services in the field of Health & Sanitation, Education, Disaster relief, Environment sustainability & Biodiversity, Animal welfare, Sustainable Livelihood & Skills building, Sports upliftment, Rural & infrastructure development for the local inhabitants of plant operational areas during the year 2022-23 to improve the quality and standard of living. Your Company undertook various activities during the year 2022-23 under review in line with its CSR Policy.

The composition of CSR Committee of your Company, attendance at the said Meeting, terms of reference of the CSR Committee and other relevant details have been provided in the Corporate Governance Report forming part of the Annual Report. The CSR Committee has confirmed that the implementation and monitoring of CSR Policy is in conformity with CSR objectives and policy of the Company and in compliance with Section 135 of the Companies Act, 2013.

Your Companyâs Policy on Corporate Social Responsibility can be accessed on the Companyâs website at https://www. starcement.co.in/upload/images/files/CSR-Policy-2021-1. pdf

Annual Report on CSR as required to be annexed in terms of requirement of Section 135 of Companies Act, 2013 and rules framed thereunder is annexed herewith and marked Annexure-3.

EVALUATION OF THE BOARD''S PERFORMANCE

In accordance with the requirements of the Companies Act 2013, the performance evaluation of the Board was carried out during the year under review. The Board follows a formal mechanism for the evaluation of the performance of the Board as well as Committee. The evaluation reflected the overall engagement of the Board and the Committee.

A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Boardâs functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance etc.,.

The Nomination and Remuneration Committee at its meeting established the criteria based on which the Board evaluate the performance of the Directors.

Independent Directors

The Directors had expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors through circular resolution dated 29th June, 2022, had appointed Mr. Deepak Singhal (DIN: 00957347) as an Additional Director of the Company in the Independent category with effect from 29th June, 2022, for a period of 3 years till 28th June, 2025 which was duly approved by the shareholders at the Annual General Meeting held on 27th September, 2022.

Mr. Deepak Singhal aged about 63 years is an IAS (Retired). He is Graduate in Engineering from IIT, Roorkee (Gold Medalist) and Post Graduate from IIT, Delhi. He is the winner of World Water Award from Sotckholm. He is having 40 years of rich and varied experiences in diverse fields. He was Chief Secretary of Govt. of Uttar Pradesh and was District Magistrate of Nainital, Bareilly and Meerut and was also Vice Chancellor of Meerut University, Chairman & Managing Director of Uttar Pradesh, Power Corporation, Principal Secretary-Home, Principal Secretary- Irrigation, Joint Secretary-Fertilisers, Govt of India, Sales Tax Commissioner and Vice Chairman of Meerut & Kanpur Development Authority etc. At present he is in the Board of Instrumentation Automation Surveillance & Communication Sector Skill Council.

Mr. Pramod Kumar Shah, Independent Director retired from the Board with effect from close of the business hours of 31st March, 2023 due to completion of his second and final terms of appointment as an Independent Director. Your Board of Directors record their appreciation for the valuable services and guidances rendered/given by Mr. Pramod Kumar Shah during his association with the Company as a member of the Board and various Committees.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors at its meeting held on 3rd February, 2023, appointed Mr. Vivek Chawla (DIN: 02696336) as an Additional Director in the Independent category with effect from 1st April, 2023 for a period of 3 years till 31st March, 2026 subject to approval of the shareholders.

Mr. Vivek Chawla aged about 62 years is BE (Hons.) in Mining Engineering from National Institute of Technology, Raipur, MP and Diploma in Business Management from IGNOU having rich and varied experience over 41 years in the industry across functions such as management, operations, manufacturing, strategy sales & marketing, projects, logistics, commercial and Mining.

Mr. Chawla has led and nurtured large businesses and managed some of the plants of ACC/ Hindalco etc. He is pioneered in large scale transformation programs in sales, logistics and manufacturing, led strategic initiative into captive

coal blocks, obtained additional limestone mining leases for future growth of the Company, conceptualised and executed large-scale capital investments including acquisitions and has managed large work forces, trade unions and external stakeholders. Presently, he is heading the Paper business of Emami Group as Whole-time Director & CEO of Emami Paper Mills Limited. He is also associated as Director with NU Vista Limited, Sanjeeva Town Welfare Association and Prakruti Prerana Foundation. His association as Director would be beneficial to the Company.

Mr. Chawla has given his consent for appointment and has confirmed that he retains his status as Independent Director and does not suffer from any disqualifications for appointment.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors through circular resolution dated 20th March 2023, appointed Mr. Jagdish Chandra Toshniwal (DIN: 01539889) as an Additional Director of the Company in Independent category with effect from 1st April, 2023 for a period of 3 years till 31st March, 2026 subject to approval of the shareholders.

Mr. Jagdish Chandra Toshniwal holds a B.E. Degree in Mechanical Engineering from Birla Institute of Technology & Science, Pilani (Rajasthan). He has nearly 45 years of experience in Cement Industry with visionary leadership, high achievement orientation, innovative capabilities, strong business acumen, a thorough cement professional having exposure in Plant operations, Green Field /Brown Field Project, Marketing, Procurement and Business Development. He has worked with Ambuja Cement Limited, Heidelberg Cement India Private Limited and different other Cement Companies. Currently, He is associated as Director with Shiva Cement Limited and Jindal Panther Cement Private Limited. Mr. Toshniwal has also worked as a Managing Director in Wonder Cement Limited. He was responsible for managing entire business of the Company including plant operations, project planning and execution, sales and marketing across nine states, setting up processess, developing the organisation for rapid growth of the Company, developing business strategies. His association as Director would be beneficial to the Company.

Mr. Toshniwal has given his consent for appointment and has confirmed that he retains his status as Independent Director and does not suffer from any disqualifications for appointment.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors through circular resolution dated 27th April, 2023, appointed Mr. Ramit Budhraja (DIN: 00053723) as an Additional Director of the Company in Independent category with effect from 1st May, 2023 for a period of 3 years till 30th April, 2026 subject to approval of the shareholders.

Mr. Ramit Budhraja, about 63 years old, has a Business Administration (MBA) Degree from Indian Institute of Management (IIM), Bangalore and B-Tech in Chemical Engineering from Indian Institute of Technology (IIT), New Delhi. He is an expert practitioner in Strategy, Marketing, Transformation, Innovation and Mergers. Mr. Budhraja has attended numerous developmental programs in India, Switzerland, and USA.

A veteran with over 30 years of experience in the Cement industry, he has motivated and led teams across the globe based out of India, Switzerland, Germany, France and Bangladesh. He has served as a Director on the Boards of ACC Concrete Limited, Alcon Cement Private Limited, Shiva Cement Limited, Bulk Cement Corporation (India) Limited and Holcim Bangladesh Limited He commissioned and took to market over 5 Mn tons of cement capacity, achieving over 34% growth in sales per year. He is credited with achieving peak performance and implementing growth strategies through mergers and acquisitions.

Mr. Ramit Budhraja has given his consent for appointment and has confirmed that he retains his status as Independent Director and does not suffer from any disqualifications for appointment.

In terms of Regulation 17(1C) of the Listing Regulations, the listed entity is required to obtain approval of the shareholders for the appointment of new Director at the next General Meeting or within a time period of three months from the date of appointment, whichever is earlier. Accordingly, the shareholders of the Company were need to approve the appointment of Mr. Vivek Chawla, Mr. Jagdish Chandra Toshniwal and Mr. Ramit Budhraja as Independent Directors of the Company, by way of special resolution through postal ballot by way of voting through electronic means or by the ensuing General Meeting whichever is earlier.

The approval of the shareholders for the appointment of Mr. Vivek Chawla, Mr. Jagdish Chandra Toshniwal and Mr. Ramit Budhraja as Independent Directors of the Company for above mentioned tenures respectively have been sought by way of special resolution through postal ballot by way of voting through electronic means.

Mr. Sajjan Bhajanka resigned as Chief Executive Officer and Key Managerial Personnel of the Company with effect from close of the business hours of 19th May, 2023, however he will continue as Chairman & Managing Director of the Company. The Board places on record its appreciation for the services rendered and guidance given by Mr. Sajjan Bhajanka during his tenure as Chief Executive Officer of the Company. On the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on 19th May, 2023 has appointed Mr. Vinit Kumar Tiwari, as

Chief Executive Officer and Key Managerial Personnel of the Company with effect from 20th May, 2023.

In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Sanjay Agarwal (DIN: 00246132) and Mr. Rajendra Chamaria (DIN: 00246171) will retire by rotation and being eligible, offer themselves for re-appointment. In view of their considerable experience, your Directors recommend the re-appointment as Directors of the Company.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and they have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and the Listing Regulations. Mr. Nirmalya Bhattacharyya, Mrs. Ibaridor Katherine War, Mrs. Plistina Dkhar, Mr. Amit Kiran Deb, Mr. Deepak Singhal (w.e.f. 29.06.2022), Mr. Vivek Chawla (w.e.f. 01.04.2023), Mr. Jagdish Chandra Toshniwal (w.e.f. 01.04.2023) and Mr. Ramit Budhraja (w.e.f. 01.05.2023) are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in section 149 of the Act and the Rules made thereunder and the Listing Regulations about their status as Independent Director of the Company.

Your Board of Directors formed opinion that the Independent Directors of the Company are maintaining highest standard of integrity and possessing expertise, requisite qualifications and relevant experience in the fields of Administration, General management, Accounts & Finance, Audit , Internal Audit, Taxation, Risk, Board procedures, Governance etc., for performing their role as Independent Directors of the Company. Regarding proficiency, all Independent Directors have registered themselves in the Data Bank maintained with the Indian Institute of Corporate Affairs (IICA), Manesar. In terms of Section 150 of the Act read with Rule 6(4) of the Companies (Appointment & Qualification of Directors) Rules, 2014, the Independent Directors are required to undertake online proficiency self- assessment test conducted by the IICA within a period of 2 (two) years from the date of inclusion of their names in the data bank. Mr. Amit Kiran Deb, Mrs. Ibaridor Katherine War, Mrs. Plistina Dkhar, Mr. Deepak Singhal, Mr. Vivek Chawla, Mr. Jagdish Chandra Toshniwal and Mr. Ramit Budharaja, Independent Directors are exempted from qualifying ''online proficiency testâ due to their relevant experience in listed companies and the Companies with Paid up equity Capital is '' 10 Crore and more. Mr. Pramod Kumar Shah and Mr. Nirmalya Bhattacharyya had appeared in ''online proficiency testâ within the period of 2 (two) years from the date of inclusion of their names in the data bank and have successfully qualified the test.

FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS

In order to enable the Independent Directors to perform their duties optimally, the Board has devised a familiarisation programme for the Independent Directors to familiarise them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. They are periodically updated about the development which takes place in the Company. Periodic presentations are made at the Board and Committee Meetings, updates of the Company, business strategy and risks involved. Site visits are arranged, whenever required. At the time of appointment of an Independent Director, the Company issues a formal letter of appointment setting out in detail, the terms of appointment, duties, responsibilities and commitments etc. The familiarisation program is available on the Companyâs website under the web link:

https://www.starcement.co.in/upload/images/files/

Familiarization-Programme.pdf

SUBSIDIARIES AND ASSOCIATE COMPANY

M/s. Star Cement Meghalaya Limited, M/s. Megha Technical & Engineers Private Limited, M/s. Meghalaya Power Limited, M/s. NE Hills Hydro Limited and M/s. Star Century Global Cement Private Limited, M/s. Star Cement (I) Limited (formerly, Star Cement Lumshnong Limited) and M/s. Star Cement North East Limited continue to remain subsidiaries of the Company.

Star Cement Meghalaya Limited, a material subsidiary, is engaged in manufacturing of Cement Clinker and has a Clinkerisation plant with an installed capacity of 1.8 MTPA. During the year under review, the Company manufactured 19,62,393 MT of clinker as against 16,54,582 MT in FY 21-22. Megha Technical & Engineers Private Limited, a wholly-owned subsidiary, is engaged in the manufacture of cement. During the year under review, the Company produced 40,526 MT of Cement.

Meghalaya Power Limited, a wholly-owned subsidiary, is engaged in generation of Power. During the year under review the Company generated 181 Mn units of power.

NE Hills Hydro Limited, wholly owned subsidiary of your Company is currently not operational.

Star Century Global Cement Private Limited a wholly-owned subsidiary in Myanmar is yet to commence its operations. M/s. Star Cement (I) Limited (formerly, Star Cement Lumshnong Limited) and M/s. Star Cement North East Limited, subsidiaries are yet to start commercial operations.

The Board of Directors of Star Cement Meghalaya Limited, Meghalaya Power Limited, Megha Technical & Engineers

Private Limited and NE Hills Hydro Limited at their respective meetings held on 2nd February, 2023 and 18th May, 2023 have approved a Scheme of Amalgamation under Sections 230 to 232 read with other applicable provisions of the Companies Act 2013, involving amalgamation of Star Cement Meghalaya Limited, Transferee Company and Meghalaya Power Limited, Megha Technical & Engineers Private Limited & NE Hills Hydro Limited, Transferor Companies and their respective shareholders and creditors, with effect from Appointed date, 1st April, 2023. The Scheme is subject to necessary approvals, including sanction of the Scheme by the Honâble National Company Law Tribunal, Guwahati Bench.

CHANGES IN NATURE OF BUSINESS, IF ANY

There has not been any change in the nature of business.

AUDITED FINANCIAL STATEMENTS OF THE COMPANY''S SUBSIDIARIES

Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement for the year ended 31st March, 2023 for each of the Companyâs subsidiaries viz. Star Cement Meghalaya Limited (SCML), Megha Technical & Engineers Private Limited (MTEPL), Meghalaya Power Limited (MPL), NE Hills Hydro Limited (NHHL), Star Century Global Cement Private Limited (SCGCPL), Star Cement (I) Limited (formerly, Star Cement Lumshnong Limited) and Star Cement North East Limited are annexed in the Form AOC - 1 and marked as Annexure-4.

CONSOLIDATED FINANCIAL STATEMENTS

The detailed financial statements and audit reports of each of the subsidiaries of the Company are available for inspection at the Registered Office of the Company during office hours between 11:00 A.M. and 01:00 PM. The Company will arrange to send the financial statements of the subsidiaries upon written request from a shareholder to the registered address of the said shareholder.

DEPOSITS

SIGNIFICANT MATERIAL ORDERS PASSED BY THE COURTS OR REGULATORS

(i) The Director of Mineral resources, Meghalaya, Shillong vide its Demand notice dated 19th February, 2020

raised a demand against the Company for payment of royalty, MEPRF, VAT/GST for an amount of '' 4184.06 Lakhs in pursuance to the National Green Tribunal (NGT) order dated 17.01.2020 passed in O.A. No. 110 (THC)/2012 against the Company and other Cement and Power Companies in Meghalaya for alleged illegal coal procurement.

The Company has not purchased any illegal coal and has complied with all disclosure requirements of the various Government departments. The report of NGT Committee has been founded on the basis of assumptions and not on hard facts. The Company backed by the legal opinions, believed that it has a good case in the matter as the said order was issued on the basis of certain hypothetical assumptions and without giving any opportunity of being heard to the Company. Accordingly, the Company had preferred an appeal before the Apex Court. The Apex court vide itâs order dated 02.05.2023 remand back the file to the NGT, at the stage, at which they stood prior to the passing of the judgement dated 17.01.2020 and set aside the judgement dated 17.01.2020. As the matter is pending no provision has been made in the accounts.(Refer Note no. 46(b) of Notes to Accounts).

(ii) In respect of demand letter received from Central Excise authority for refund of Education Cess and Secondary & Higher Education Cess amounting to '' 566.05 Lakhs, the Company has filed a writ petition before the Honâble Meghalaya High Court for quashing of demand notice, the Meghalaya High Court has stayed the said demand notice matter is sub-judice and final hearing of the case is yet to be conducted, therefore, no provision have been taken in the books of account. No further development took place during the year. (Refer Note no. 46(a) of Notes to Accounts).

(iii) During the year the Company has received a demand notice dated 20th March, 2023 from the Divisional Mining Officer (DMO), Directorate of Mineral Resources, Meghalaya, Jowai towards outstanding dues of royalty & Cess on Coal, Sandstone, Clay and Shale procured/ consumed by the Company in certain specific periods between F.Y. 2009-10 to F.Y. 2022-23 amounting to '' 2,650.31 Lakhs (including '' 1,552.61 Lakhs towards Penal Interest). As per the provisions of the Mines and Minerals (Development and Regulation) Act, 1957, the liability for payment of royalty in respect of any mineral removed/ consumed from the mining lease arises on the holder of the mining lease and not on the purchaser of such mined minerals. Hence, there is no obligation of the Company to pay royalty/cess in case the minerals are procured from third party vendors. However, as an

abundant precaution, the Company has kept liability towards Royalty & Cess on above mineral products amounting to '' 487.88 Lakhs (including net additional provision of '' 89.79 lakhs during the year). Since the liability to pay royalty & Cess itself is not applicable to the Company, hence provision for differential amount of demand amounting to '' 609.82 Lakhs and penal interest amounting to '' 1,552.61 Lakhs has not been provided as a matter of prudence and shown as contingent liability. The Company shall contest the above demand and based on the legal opinion obtained in this regard, it believes the said demand raised by the DMO is not tenable and the matter shall be disposed off in the favour of the Company (Refer Note no. 46(c) of Notes to Accounts).

Other than the aforesaid, there have been no significant and material orders passed by the Courts/ Regulators impacting the going concern status and future operations of the Company.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes or commitments have occurred between the end of the financial year and the date of this Report which affect the financial statements of the Company in respect of the reporting year.

CREDIT RATINGS

Your Company enjoys a sound reputation for its prudent financial management and its ability to meet financial obligations. ICRA Limited, has reaffirmed the Companyâs short term rating to [ICRA]A1 (pronounced ICRA A one plus) and the long term rating to [ICRA]AA- (pronounced as ICRA double A minus) The outlook on the long term rating is ''Positiveâ. CRISIL Ratings, has affirmed the long term rating to

''CRISIL AA-/Positiveâ (pronounced CRISIL double A minus). The outlook on the long-term rating is ''Positiveâ

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design or operations were observed. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

DETAILS OF SIGNIFICANT CHANGES (I.E., CHANGES OF 25% RETURN ON NETWORTH ALONGWITH DETAILED EXPLANATIONS			OR MORE) IN KEY FINANCIAL RATIO AND CHANGE IN
Key Financial ratios	FY 22-23	FY 21-22	% change	Explanation for Significant Changes
Debtors Turnover ratio	23.13	16.19	42.84	Change on account of increase in sales by 23% and reduction in trade receivables
Inventory Turnover ratio	19.79	22.01	(10.10)	NA
Interest Coverage ratio	20.89	14.78	41.34	Increase on account of higher net profit achieved during the year and reduction of substantial borrowings.
Current ratio	1.31	1.63	(19.60)	NA
Debt Equity ratio	0.03	0.06	(56.21)	Change is due to major repayment of Long term borrowings during the year.
Operating Profit Margin (%)	12.53	11.61	7.96	Change on account of higher profit before interest and tax
Net Profit Margin (%)	6.27	8.38	(25.23)	Change on account of higher taxes
Return on Net Worth (%)	11.87	13.70	(13.32)	NA

MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES

The disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 along with a statement containing particulars of employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith and marked Annexure-5 and forms part of this report.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

There was no application made or proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016, during the year under review.

DETAILS OF DIFFERENCE IN VALUATION

The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

The Company values the integrity and dignity of its employees. The Company has put in place a ''Policy on Prevention of Sexual Harassmentâ as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("Sexual Harassment Act") and has constituted the Committee with internal and external members. We affirm that adequate access has been provided to any complainants who wish to register a complaint under the policy. No complaint was received during the year.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements as stipulated under the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). A separate section on corporate governance, along with a certificate from the auditors confirming the compliance, is annexed and forms part of the Annual Report. This certificate will be forwarded to the Stock Exchanges along with the Annual Report of the Company.

CHIEF EXECUTIVE OFFICER (CEO) /CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI), the CEO/ CFO certification has been submitted to the Board and a copy thereof is contained in this Annual Report.

RISK MANAGEMENT

Risk management refers to the practice of identifying potential risks in advance, analyzing them and taking precautionary steps to reduce the risk. The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.

HUMAN RESOURCE DEVELOPMENT & INDUSTRIAL RELATIONS

Human Resource (HR) supports and upholds Star Cementâs overall goals, vision & mission by fostering a positive and engaging work environment. HR ensures that employees are engaged and motivated to help the Company succeed. Human resources at Star Cement is responsible for a productive and thriving workforce that is engaged and motivated. HR ensures that employees feel safe, valued and properly supported to unleash their full potential and contribute towards achievement of companyâs overall goals and vision.

The year 2022-23 started off with the new mission of providing HR support to all stakeholders underlying the theme "Better & Faster"- delivering HR services "Better" than it was done and "Faster" than earlier. Transformative journey of HR commenced through heightened employee engagement, standardised processes, and increased service effectiveness and efficiency across locations

New and competitive salary structure was also introduced to give employees the flexibility to choose the best fit which is both market competitive and employee friendly. Major aim was also bring in uniformity, standardisation and fairness in CTC structure across all the locations.

It was critical to homogenise key talent acquisition processes across the organisation as a part of the Talent Acquisition strategy and tactics to meet the future challenges of the competitive Talent landscape. In our endeavor to ensure that we have the right people, at the right time in the right positions, we standardised the Talent Acquisition process through thoughtfully designed recruitment tools / formats which are now being used across locations to develop candidate pools and proactively court high-quality talent.

One of the major breakthrough was working towards introduction of "better and faster" HR Automation tool with the objective of providing quality employee experience offering seamless transactions across all HR workflows/ employee self service through an intuitive, easy to use interface available both on web and mobile.

We were able to sustain our Reward & Recognition initiatives by way of recognising employees instantly for their contributions and also recognising valuable suggestions from them having a positive impact towards the growth/ benefit of organisation.

Towards the journey of Business Excellence, HR contributed through partnering with business at various touch points and one major achievement was introduction 5S (a workplace organisation method) at our Lumshnong and Siliguri plant through anchoring the initiative and driving awareness on the same through all relevant stakeholders.

Training and Development initiatives were more robust and business oriented catering to both organisation and individual needs. Proper tracking of capability development initiatives helped to identify the impact of training across department in terms of mandays and coverage which in turn was an input towards Talent Development Strategy.

Industrial Relations have been effective with several interventions & good practices. During the year gone by, there has not been any material changes in human resources and industrial relations as proactively employee welfare related aspects across plant locations were addressed and taken care of.

AWARDS AND ACCOLADES

During the year Star Cement was also awarded with Rotary RMB Connect 2022 Award in association with The Telegraph T2 for the most trusted invaluable service and excellence in the category of Cement Industry in 2022.

GREEN INITIATIVES IN CORPORATE GOVERNANCE

Ministry of Corporate Affairs has permitted Companies to send copies of Annual report, Notices, etc., electronically to the email IDs of shareholders. Your Company has arranged to send the soft copies of these documents to the registered email IDs of the shareholders, wherever applicable. In case, any shareholder would like to receive physical copies of these documents, the same shall be forwarded upon receipt of written request in this respect.

The Ministry of Corporate Affairs has taken ''Green Initiative in the Corporate Governanceâ by allowing paperless compliances by the Companies and has issued circulars stating that service of notice/documents including Annual

Report can be sent by e-mail to its members for the financial year 31st March, 2023. A newspaper advertisement in this regard is being published.

CAUTIONARY STATEMENT

Statements in this report describing the Companyâs objectives, expectations or predictions, may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companyâs operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in Government policies and tax laws, economic development of the country, our business, the businesses of our customers, vendors and partners and other factors which are material to the business operations of the Company.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their deep sense of gratitude to Banks, Central and State Governments and their departments and the local authorities, customers, vendors, business partners/associates for their continued guidance and support.

Your Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Company and dedicates the credit for the Companyâs achievements to them. Last but not least, your Directors express their gratitude to the shareholders of the Company for reposing their confidence and faith in the Management of the Company and look forward for their support in future.

For and on behalf of the Board of Directors

SAJJAN BHAJANKA

Place: Kolkata CHAIRMAN

Date: 19th May, 2023 (DIN: 00246043)

Mar 31, 2022

Your Directors have pleasure in presenting Twenty-First Annual Report of the Company together with the Audited Standalone & Consolidated Balance Sheet as at 31st March, 2022 and the Statement of Profit & Loss for the year ended on that date.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the financial year ended 31st March, 2022 as compared to the previous financial year are as under:

('' in Lakhs)
Particulars	Consolidated		Standalone
	FY 21-22	FY 20-21	FY 21-22	FY 20-21
Total Income	2,25,519.07	1,74,815.28	2,20,102.21	1,68,516.16
Profit before Interest, Depreciation and Tax and exceptional items	37,862.33	36, 082.08	25,488.56	26,214.64
Interest & Finance Charges	1,334.03	698.86	1,236.19	1,255.87
Depreciation	12,162.95	8,999.41	7,214.85	4,773.29
Profit before exceptional items and tax	24,365.35	26,383.81	17,037.52	20,185.48
Exceptional Items	-	6,457.42	-	2,931.36
Profit/(Loss) before Tax	24,365.35	19,926.39	17,037.52	17,254.12
Provision for taxation:
- Current Tax	252.42	1,725.98	-	1,725.98
- Income tax for earlier years	(2.46)	9.56	(4.92)	-
- Deferred Tax	(562.09)	(522.14)	(589.73)	(199.07)
Net Profit after Tax	24,677.48	18,712.99	17,632.17	15,727.21
Other comprehensive income for the year, net of tax	(14.17)	14.45	2.33	5.42
Total comprehensive income for the year	24,663.31	18,727.44	17,634.50	15,732.63
Net profit attributable to:
Owners of the Company	24,677.48	18,712.99	-	-
Non-controlling interest	-	-	-	-
Total	24,677.48	18,712.99	-	-
Other Comprehensive Income attributable to:
Owners of the Company	(14.17)	14.45	-	-
Non-controlling interest	-	-	-	-
Total	(14.17)	14.45	-	-
Total Comprehensive Income attributable to:
Owners of the Company	24,663.31	18,727.44	-	-
Non-controlling interest	-	-	-	-
Total	24,663.31	18,727.44	-	-

OPERATIONAL REVIEW

During the year, the Government undertaken certain crucial steps and initiations which helped the entire nation to overcome from the pandemic situation. Vaccination played a curicial role in reducing number of deaths and restoring normalisation in daily life which contributed towards reestablishing confidence in the economy. We have also organised vaccination camp across all our locations and spontaneous response received from the employees and their families.

Lockdown led cement demand disruption in first quarter of the year. The lock down period thrown huge challenge before the manufacturing sectors. However, during the period cement industry withnesseth huge growth in terms of volume and prices. Better availability of labour, increase in construction of infrastructure alongwith low cost housing pushed the cement demand of the country.

During the year under review, your Company has manufactured 5,20,517 MT. of Cement Clinker as against 4,35,053 MT. recorded during the FY 20-21. Companyâs subsidiary M/s. Star Cement Meghalaya Limited has produced 16,54,582 MT. of Clinker as against 14,75,660 MT. during the FY 20-21. On consolidated basis total clinker production during the year was at 21,75,099 MT. as against 19,10,713 MT. during FY 2021. Your Company recorded overall growth in its performance during the year.

In terms of capacity utilisation, clinkerisation unit of your Company was able to utilise 55% of its installed capacity as against 54.93% during the FY 20-21. Similarly, the capacity utilisation of clinkerisation unit of its subsidiary M/s. Star Cement Meghalaya Limited was at 88.01% during FY 2122 as against 84.37% during the FY 20-21. On consolidated basis, the capacity utilisation of clinkerisation units was at 85.60% during the FY 21-22 as against 75.20% during FY 2021.

Your Company has been able to maintain the performance on grinding front too. During the year under review, total cement production on consolidated basis was at 34,05,671 MT. as against 26,36,338 MT. during the FY 20-21.

Similarly, your Company has been able to achieve sales volume of 33,92,185 MT. of Cement as against 26,44,048 MT. during the previous financial year.

BUY -BACK OF SHARES

During the year under review your Company has bought back 82,48,580 Equity Shares of '' 1 each from all the existing shareholders/ beneficial owners of the Company as on record date i.e., 26th August, 2021 on a proportionate basis through tender offer route at a price of '' 150 each for an aggregate amount of '' 1,23,72,87,000 (Rupees One Hundred Twenty Three Crore Seventy Two Lakhs and Eighty Seven Thousand only). The payments have been made to all the eligible shareholders on 13th October, 2021, subsequently the bought back shares have been extinguished resulting in reduction of paid up share capital to '' 40,41,80,417 divided into 40,41,80,417 equity shares of '' 1 each.

In accordance with Section 69 of the Companies Act, 2013, during the year ended 31st March, 2022, the Company has created a Capital Redemption Reserve of '' 82,48,580 equal to the nominal value of Shares bought back as an appropriation from General Reserves.

DIVIDEND

The Board of Directors of your Company, after considering holistically the requirement of funds for Companyâs upcoming project at Lumshnong and Sonapur Plant and the relevant circumstances has decided that it would be prudent, not to recommend any Final Dividend for the Financial Year 21-22 (Previous year NIL).

INDIAN ECONOMY AND OUTLOOK - AT A GLANCE

After struggling with Covid for consecutive two years, when the world economy was poised for recovery Russia-Ukraine conflict has rattled the world and clouds for uncertainilty again covered the global economy. Due to outbreak of war crude oil prices rising day to day and the war has pushed up prices of gas, edible oil, metals and food crops etc. The share of Russia in Indiaâs total trade is 1%, however indirect impact of war through market is huge. Inflation has reached a record high and the manufacturerers have started increasing prices and passing on higher input cost to the consumers. The cost of coal reached to a new height which has a direct bearing on fuel cost. The higher oil prices will lead to current account deficiency. The impact of war on Indian economy will be seen in this fiscal and it will be very challenging to overcome from the current scenario.

After contraction of economy in FY 20-21, Indian GDP recorded a growth @ 8.7%. Private sector investment is likely to increase to support recovery of economy.

The Governmentâs revenue receipt has been increased considerably. GST collection has been reached at record high. Gross tax revenue has also been increased. Overall impact of economic development reflects in controlling budget deficit. There has been increase of Govt. debt due to support system provided to the poor class people for covid -19, but with the sign of recovery of the economy the same is expected to decline.

The Government of India has taken certain initiatives to improve economic stability of the country.

The Union Budget FY 22-23 prioritised four wings like PM Gati Shakti, Inclusive development, Productivity enhancement and financing of investment by which capital expenditure is expected to rise by 27%. The increased Government expenditures will attract private investment. Under Atma Nirbhar Bharat production linked incentive scheme will extend to 14 sectors. The Governement to invest in PLI scheme for domestic solar cells of '' 24,000 Crore. The Government announced allocation of '' 44,720 Crore to BSNL as capital investment for 4G spectrum. The Government initiative under PLI scheme for manufacturing advanced chemistry cell batteries which would attract domestic and foreign investments worth '' 45,000 Crore. There will be investment of '' 2.38 lakh Crore in Indian Railways. To boost competitiveness the Governement decided to revamp SEZ. The macro economic stability of the country indicates that country is prepared to meet the challenges for FY 22-23. Countryâs large foreign exchange reserve, on going foreign investment and expanding exports revenue will progress the country towards development.

CEMENT INDUSTRY OVERVIEW

India is the second largest producer of cement in the world. Country has a lot of potential for development in cement sector. The infrastructure and construction sector are the major contributors for development of the sector. In view of deregulation, the sector had attracted huge investment from within the country and abroad.

Countryâs cement industry promises huge potential for growth. Countryâs cement production capacity stood at 545 MT. p.a. and currently producing 294 Mn tonnes (MT.) in F.Y. 2021. The Indian cement industry is likely to add ~80 Mn tonnes (MT) capacity by FY24, the highest since the last 10 years. Cement demand to register a CAGR of 8% between FY21-24 through infrastructure investments and healthy housing demand. Per-capita income and per capita cement consumption of the eastern and central regions are well below Pan-India numbers and thus provides huge scope for potential growth.

East India demand is expected to grow by 28% with a CAGR of 9% by FY 25-26. West Bengal and Bihar is the strongest cement consuming state in the eastern-region accounts with more than one-fourth of the regionâs total demand at ~22 Mn tonnes and 18 Mn tonnes respectively. Cement demand in West Bengal and Bihar has also grown in the last five years with the help of central governmentâs housing for all as well as rapid infrastructure development in rural and urban sectors. In order to help the industry, the Government of India has taken various initiatives which will likely to boost cement demand in the country. The Union Budget allocated '' 13,750 Crore for Urban Rejuvenation Mission like AMRUT and Smart Cities Mission and Swachh Bharat Mission. Under the housing for all segment, 8 Mn households will be identified according to the Budget FY 22-23 with '' 48,000 Crore set aside for PM Awas Yojana.

NHAI plans to construct 25,000 kilometres of national highways in FY 22-23 at a pace of 50 km per day. As per the Union Budget FY 22-23, the government approved an outlay of '' 1,99,107 Crore for the Ministry of Road Transport and Highways. The Government of India has allocated ''111 lakh Crore under the National Infrastructure Pipeline for FY 19-25. The roads sector is likely to account for 18% capital expenditure over FY 19-25.

Under Phase-I of Bharatmala Pariyojana, the Ministry has approved implementation of 34,800 km of national highways in 5 years with an outlay of '' 5,35,000 Crore. Under this scheme, 22 Greenfield projects (8,000 kms length) are being constructed; this is worth '' 3.26 lakh Crore.

Prime Minister also launched the ''PM Gati Shakti - National Master Plan (NMP)â for multimodal connectivity. Gati Shakti will bring synergy to create a world-class, seamless multimodal transport network in India. This will boost the demand for cement in the future.

In order to boost up demand of cement industry Government plans to spend '' 1.97 lakh Crore in next 5 years for PLI schemes in 13 Sectors.

In view of increasing demand in various sectors such as housing, commercial construction and industrial construction, Countryâs cement industry is expected to reach 420 Mn tonnes per annum (MTPA) by FY 2027. Eastern states are likely to contribute for the development of the region as their untapped markets are likely to be explored.

EAST & NORTHEAST SCENARIO - GATEWAY OF OPPORTUNITIES

The Government of India has initiated in various fonts for overall development of North Eastern Region of the country. On a range of indicators, the rate of development now a days is on the rise, with notable improvements in health, education, infrastructure development and industrialisation which contributed in development of socio economic standard of the Region.

As per Budget FY 22-23, Centre will fund infrastructure improvement and social development projects in North East Region which will create job opportunities and help improvement in employment sector in the Region. A new scheme PM-DIVINE will be implemented which will fund infrastructure and social development.

On the initiatives of the Prime Minister, Ministry of Road Transport and Highways has taken up an ambitious Special Accelerated Road Development Programme (SARDP-NE) for development of road network in the north eastern States of the Country. The Total Length identified under SARDP-

NE is 892.822 Km. There are 4(four) Numbers of projects with a total length of 263.364 km amounting to '' 1994.90 cr to be Implemented by National Highways Infrastructure Development Corporation Limited (N.H.I.D.C.L.).

As per the Union Budget 2022, a new scheme, Prime Minister''s Development Initiative for NorthEast, PM-DevINE, will be implemented through the North-Eastern Council. It will fund infrastructure, in the spirit of PM GatiShakti, and social development projects based on felt needs of the North-East. This will enable livelihood activities for youth and women, filling the gaps in various sectors. An initial allocation of Rs 1,500 Crore will be made.

Under PM-DEVINE construction of Aizal By- pass will be made at a cost of '' 500 Crore, a pilot projects have been undertaken for construction of bamboo linked road at different locations in Mozoram at a cost of '' 100 Crore.

During Covid, Oxygen plant was set up in Arunachal Pradesh and '' 250 Crore was sanctioned for health care facilities in North East Region.

Gross Budget Allocation for Northeast Frontier Railway (NFR) is '' 11,428.86 Crore. Budget Allotment for the FY 22-23 for the North-eastern States is 44% more than previous year''s allotment ('' 6,913 Crore) and 370% more than the average of FY 09-14 allotment. As per policy of the Indian Railways work for 100% electrification of NFR routes are also going on which will boost the economy of North Eastern states and it will bring N.F. Railway at par with other Electrified Railway. Electrification work is already complete in 766 RKM in NFR and work is going on in 210 RKM section in NFR which is likely to be completed by FY''22. Work in remaining 3216 RKM is planned to be completed by March, 2024. This will impart efficient, pollution free transportation needs of N. E. States. Under the North East Special Infrastructure Development Scheme (NESIDS), since 1st January, 2021, 30 projects worth '' 413.63 Crore have been sanctioned in various North Eastern States under North East Special Infrastructure Development Scheme (NESIDS), which include 17 health projects worth '' 231.19 Crore sanctioned for strengthening health infrastructure of NE States and combating outbreak of COVID-19.

Development of new Greenfield Airports at Holongi and Tezu in Arunachal Pradesh; Dibrugarh, Guwahati and Silchar Airports in Assam; Imphal Airport in Manipur; Barapani Airport in Meghalaya and Agartala Airport in Tripura, etc are ongoing projects in the NER.

As per Union Budget, West Bengal awarded high way project for '' 25,000 Crore. The Government of West Bengal facilitating road connectivity across the State. In the State budget, the Government allocated '' 4,546 Crore for development of roads and bridges. As per report of IBEF, in November 2020, the World Bank approved a USD 105 Mn project to improve

inland water transport infrastructure in Kolkata. In December 2020, the State government approved construction of a deep sea port in Tajpur, which will be built for '' 15,000 Crore (USD 2,028 Mn)

Implementation of aforesaid projects and initiatives of the Government will contribute in all round development in NER which will pool cement demand and lead to increase in per capita consumption of cement and would help the Company to increase its market share in the Region.

MARKET DEVELOPMENT

As a strategy, the North East Market continued to be the focus market for your Company. Cement demand was good throughout the year. Demand increased by 17% in NER against an all India average of 8%.

During the year under review your Company was able to sell 25,45,545 MT. of cement in NER market as against 21,07,800 MT. during the FY 20-21. During the year under review, around 20% of the total Cement demand in NER was catered to by the industry through imports from other regions including Bangladesh and Bhutan.

Overall Cement Sales accounted for 3.4 Mn Tonnes in FY 2122 as against 2.64 Mn Tonnes in FY 20-21.

In order to meet the clinker demand for the Siliguri Plant, during the year your Company has not made any export of clinker. (Previous year 46,526 MT.).

As a market leader in NER your Company has further consolidated dealers and sub dealer''s network. Currently your Company is associated with 2,100 dealers and 12,000 sub dealers. The Company has introduced a mobile application for dealers for payments, order booking, printouts of invoices and ledgers. This initiative is helping dealers in timely submission of GST returns.

During the year Star Cement Limited continued with the Brand Television Commercial with Akshay Kumar as brand Ambassador, one of the biggest Stars of Bollywood. Association of Akshay Kumar being the brand ambassador caused an uplift on the brand perceptions and has had a positive impact on the saliency of Star Cement as a brand. The Brand Campaign has the key message of highest one day strength which makes Star Cement ready for all challenges depicted with the tagline "Hain Tayyar Hum". The TV commercial is being seen across all major regional news channels in North East, West Bengal, Sikkim & Bihar. The commercial also have presence in the Digital medium and a heavy BTL presence through Surrogate boards, Hoardings, Wall Painting & Dealer/Retailer branding across North East, West Bengal, Sikkim & Bihar. The campaign hence has visible across 360 degrees in multiple mediums.

PRODUCTION AND COST DEVELOPMENTS Fly Ash

Your Company focused upon increase in production of Portland Pozzolana Cement (PPC). As a result we could consume higher quantity of Fly Ash which is otherwise an environment hazard. In the process we could consume 9,30,501 MT of Fly Ash which is 30% higher as compared to FY''21.

In order to bring down the cost of Fly Ash, various cost saving initiatives were taken throughout the year. All Fly Ash transportation through rakes were done through BOXN resulting in lower freight cost. We also established new partnerships with new sources Hindalco at Krishnashila & Odisha Power at Jharsuguda leading to sustained material availability and cost efficiency.

Logistics & Freight

The first quarter of the year marred by COVID disruptions which impacted the complete supply chain. Diesel prices reached to historical highs during the month of Nov''21 which resulted in increased pressure on freight cost. The freight cost in NE was also majorly impacted due to Overload restriction in Assam and recurrence of bridge damage in Meghalaya. Your Company steered through these challenges to ensure that supplies to Market are ensured while keeping the cost in control. FY''22 saw our Siliguri plant operated in full-fledged throughout the year which ensured the market are served with reduced Order to Delivery Time and increase market penetration. The year also saw cement dispatches through rake at 2.8 Lakh MT which was 48% higher as compared to FY''21 to mitigate the impact of high road logistics cost. Logistics Cost efficiency was further improved through sustained efforts of key initiatives such as month e auction, PTPK outlier, Wheeler & Segment wise freight implementation. Construction of rake siding through PPP mode at SGU is towards completion and expected to commission by May''22. With Siliguri Plant & Other key Initiatives implemented, Wtd. Avg. Freight cost reduced to '' 979 Per MT. (YTD Feb''22) from '' 1,140 per MT. recorded in previous year. Wtd. Avg. Lead distance reduced to 221 KM from 258 KM recorded in the year before.

Your Company has always focused on giving best Logistics service to the consumers at the most economical costs. Various efforts were taken up to improve on Service Levels towards which additional 14 SOW''s were opened across NE, West Bengal & Bihar. 190 no. of 16 Wheelers trucks were also inducted in our organisation for continuous movement of Raw material and to reduce impact of market fleet fluctuations. Warehouse optimisation continued across the year for better servicing the customers resulting in increased customer satisfaction.

Your Company received Prestigious "CM SCALE Award" for Excellence in Supply Chain Management 3rd time in Row.

Power cost

Coal availability from local sources remained constrained. Sourcing of Coal was done majorly from Coal India Limited (CIL) and Imported Coal from South Africa. We successfully participated in auction of CIL & procured FSA of 1.26 lakh MT/ annum. The Company also procured good quantity of Coal supplies on spot auctions from CIL during the year, keeping the overall cost in control.

KEY PERFORMANCE HIGHLIGHTS

â¢ Consolidated cement production was at '' 34.06 Lakhs MT during the year as against 26.36 Lac MT during the previous financial year.

â¢ Consolidated net sales at '' 2218.74 Crore during the year under review as compared to '' 1,748.15 Crore during the financial year 20-21.

â¢ Consolidated EBIDTA was at '' 378.62 Crore during the year under review as compared to '' 296.25 Crore during the immediate previous financial year after exceptional items.

â¢ Consolidated profit before tax during the year FY 21-22 was at '' 243.65 Crore as against a profit of '' 199.26 Crore in the year FY 20-21.

â¢ Consolidated Exceptional items during the year was NIL as against '' 64.57 Crore recorded in previous year

OPPORTUNITIES & THREATS, RISKS AND CONCERNS

Marketing strength of Star Cement lies on strong dealers network. Locational advantages helped to procure raw materials at affordable prices. Company''s aggressive marketing strategies and strong branding network also contributed to establish its position as the market leader in the region. Company''s new Siliguri plant will also contribute to expand the market in eastern region of the county. Company''s dependence on domestic market and business concentration on regional market for a longer period of time may adversely affect the growth of the Company. Environmental impact and other force majure events may affect the operations of the Company. A less than optimal demand growth in the region may lower revenues of the Company.

Governmentâs various initiatives like Make in India, Housing for all, development of Ports, Roads and Highways, dam & irrigation project, National Highway Development programme, Bharat Nirman Yojana, dedicated Freight Corridors, Gauge conversion Projects undertaken by Railways, development in the area of alternative source of energy viz. Hydro and Solar Power and other infrastructure projects is expected to boost Cement and Power Demand of the country. Governmentâs special drive for development of the North Eastern Region will also help the sustained development of the industry. Various positive moves on the policy front, in areas related to ease of doing business, promoting start-ups, rationalising the tax structure, administration, and opening up more areas for foreign investment through the automatic route will also increase the demand of cement and power.

Competition in the cement industry is very high apart from the large players there are also small players in the market. Competition from the foreign players may lead to tougher competition to the domestic players. This allows limited market share in the industry. Constant increase in fuel costs leads to high transportation cost. Availability of coal at a affordable cost became a constraint factor. In order to tackle the situation your Company optimally utilising its reserved coal and entering Fuel Supply Agreement with various suppliers. Cement Industry is highly fragmented and it is also highly regionalised, transportation of low volume of cement over long distances become uneconomical.

Cement and power industry being majorly dependent upon availability of raw materials at affordable cost. Policies of the Government as well as Central and State Laws may

adversely affect the availability of lime stone, coal etc. Any major changes in Governmentâs Environmental and Forest regulations may affect limestone and coal availability to cement plants. However, your Company is sourcing raw materials from alternate sources so that raw materials availability risks is mitigated. Companyâs vast dealerâs network across the States also help to mitigate the risk.

Your Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of Directors of the Company is kept informed about the risk management of the Company. The Board of Directors have formed a Risk Management Committee inter alia, to oversee the risk assessing and mitigation process of the Company and advice the management in this regard.

SHARE CAPITAL

The paid up Equity Share Capital of the Company as on 31st March, 2022 was '' 40,41,80,417 divided into 40,41,80,417 equity shares of '' 1 each. Consequent upon bought back of 82,48,580 Equity Shares of '' 1 each the paid up Equity Share Capital of the Company has been reduced during the Financial year ended 31st March, 2022 to that extent. During the year under review, the Company has neither issued any shares with differential voting rights nor granted stock options or sweat equity shares.

SHARES IN SUSPENSE ACCOUNT

Disclosures of the shares lying in Companyâs Unclaimed Shares Suspense Account are given in the Report of Corporate Governance.

INVESTOR EDUCATION AND PROTECTION FUND

As per Companies Act, dividends that are unclaimed/unpaid for a period of seven (7) years from the date of their transfer are required to be transferred to the Investor Education and Protection Fund (''IEPFâ) administered by the Central Government.

The tentative date for transfer of unclaimed and unpaid dividends to the IEPF, declared by the Company are as under:

Financial Year	Date of Declaration	Tentative Date for transfer to IEPF
2015-16 (Interim)	9th June, 2015	18th July, 2022
2017-18 (Final)	31st July, 2018	6th September, 2025
2019-20 (Interim)	6th February, 2020	14th March, 2027

above due dates. Pursuant to the provisions of IEPF Authority (IEPF) (Accounting, Audit, Transfer and Refund) Rules, 2016 (''IEPF Rulesâ), the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on 30th September, 2021 (date of the last AGM) on the website of the Company at www.starcement.co.in and

also on the website of the Ministry of Corporate Affairs at www.mca.gov.in.

Further, pursuant to the provisions of Section 124 of the Act, read with the relevant Rules made thereunder, shares on which dividend has not been paid or claimed for seven (7) consecutive years or more shall be transferred to the IEPF Authority as notified by the Ministry of Corporate Affairs. Accordingly, Interim Dividend declared for the Financial year 15-16 which was unpaid for Seven (7) consecutive years aggregating to '' 2,96,158 and the 40,158 equity shares in respect of which dividend entitlements has not been paid or claimed for seven (7) consecutive years or more will be transferred by the Company to the IEPF Authority after following the required provisions of Rules as on 18th July, 2022. The Company has sent intimation letters to the members and published advertisement in the newspapers. The details are available on the web site of the Company at www.starcement.co.in

The shareholders whose dividend/shares have been/ will be transferred to the IEPF Authority may claim the shares or apply for refund by making an application to the IEPF Authority by following the procedure as detailed in the IEPF Rules and as enumerated on the website of IEPF Authority at http://www.iepf.gov.in/IEPF/refund.html.

ANNUAL RETURN

MEETINGS OF THE BOARD

During the year four (4) Board Meetings and four (4) Audit Committee Meetings were convened and held on 9th June, 2021, 13th August, 2021, 01st November, 2021 and 25th January, 2022. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. The details of the Board meeting and the Committee meeting are provided in the Corporate Governance Report.

MEETINGS OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent Directors was held on 25th March, 2022 wherein the performance of the Non-Independent Directors and the Board as a whole was reviewed. The Independent Directors at their meeting also inter alia assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.

COMMITTEES OF THE BOARD

The composition and terms of reference of the Audit Committee, Nomination and Remuneration Committee,

Corporate Social Responsibility Committee, Stakeholders Relationship Committee, Risk Management Committee and Finance Committee have been furnished in the Corporate Governance Report forming part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee and Nomination and Remuneration Committee.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Whistle Blower Policy/ Vigil Mechanism as required under Section 177 of the Companies Act, 2013 and as per Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). The Vigil (Whistle Blower) mechanism provides a channel to the employees and Directors to report to the management, concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct or policy. The mechanism provides for adequate safeguards against victimisation of employees and Directors to avail the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said policy may be referred to at the Companyâs website at the web link: https://www.starcement.co.in/upload/images/ files/Whistle-Blower-Policy-4.pdf

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT EMPLOYEES

The Board has framed a Remuneration Policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management Employees. The remuneration policy aims to enable the Company to attract, retain and motivate highly qualified members for the Board and at other executive levels. The remuneration policy seeks to enable the Company to provide a well-balanced and performance-related compensation package, taking into account shareholder interests, industry standards and relevant Indian corporate regulations. The details on the same are given in the Corporate Governance Report. The said policy may be referred to at the Companyâs website at the web link: https://www.starcement.co.in/upload/images/ files/Remuneration-Policy.pdf

DIVIDEND DISTRIBUTION POLICY

of dividend, policy for utilisation of retained earnings and the parameters with respect to different classes of shares for the purpose of declaration of dividend. The said policy may be referred to at the Companyâs website at the web link: https:// www.starcement.co.in/upload/images/files/Dividend-policy. pdf.

CODE OF CONDUCT

With intent to enhance integrity, ethics & transparency in governance of the Company your Company had adopted a Code of Conduct for Directors and Senior Management Personnel. The Code has been displayed on the Companyâs website www.starcement.co.in

COMPLIANCE WITH THE SECRETARIAL STANDARDS AND INDIAN ACCOUNTING STANDARDS

The Company has complied with the applicable Secretarial Standards as recommended by the Institute of Company Secretaries of India. The Company has also complied with all relevant Indian Accounting Standards (Ind AS) referred to in section 133 of the Companies Act, 2013 read with Companies (Indian Accounting Standards) Rules, 2015 while preparing the financial statements.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

â¢ In the preparation of Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures, if any;

â¢ The Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2022 and of the profit of the Company for the year under review;

â¢ The Directors have prepared the annual accounts on going concern basis;

â¢ The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

â¢ The Directors have laid down internal financial controls to be followed by the Company and that such internal

financial controls are adequate and were operating effectively.

AUDITORS & AUDITORS'' REPORT

M/s. D. K. Chhajer & Co., Chartered Accountants (Firm Registration no. 304138E) were appointed as the Statutory Auditors of the Company to hold office for five consecutive years starting from the conclusion of the 16th Annual General Meeting (AGM) held on 11th September, 2017 until the conclusion of the 21st Annual General Meeting of the Company to be held during the Financial year 21-22. The term of office of M/s. D. K. Chhajer & Co., as Statutory Auditors of the Company will conclude from the close of the forthcoming AGM of the Company.

Subject to the approval of the members of the Company, the Audit Committee and the Board of Directors during their respective meetings held on 17th May, 2022 have considered and recommended the appointment of M/s. Singhi & Co., Chartered Accountants (Firm Registration Number: 302049E) as the Statutory Auditors of the Company, to hold office from the conclusion of the 21st Annual General Meeting until the conclusion of the 26th Annual General Meeting of the Company to be held in the year 2027.

M/s. Singhi & Co., Chartered Accountants (Firm Registration Number: 302049E) have given their consent for the proposed appointment as Statutory Auditors of the Company from the conclusion of the ensuing Annual General Meeting of the members of the Company. They have further confirmed that the said appointment, if made, would be within the prescribed limits under the Companies act, 2013 and that they are not disqualified for appointment.

The notes to the accounts referred to in the Auditorsâ Report are self-explanatory and, therefore, do not call for any further comments.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its manufacturing activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, appointed Messrs B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the financial year ended 31st March, 2022 in the Board Meeting held on 9th June, 2021. The remuneration proposed to be paid to them for the Financial year 21-22, as recommended by audit committee, was ratified in the meeting of shareholders held on 30th September, 2021.

Messrs B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) have expressed their willingness to be re-appointed as Cost Auditors of

the Company for ensuing financial year. The Board, on recommendation of the audit committee has re-appointed Messrs M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the Financial year 22-23 subject to ratification of their remuneration by shareholders in the General Meeting of the Company.

As per the provisions of the Companies Act, 2013, the remuneration payable to the Cost Auditor is placed before the Members in a General Meeting for their ratification. Accordingly, a Resolution seeking Membersâ ratification for the remuneration payable to M/s. B. G. Chowdhury & Co., Cost Auditors for the Financial year 22-23 is included in the Notice convening the Annual General Meeting.

The cost audit report for the Financial Year 20-21 was filed with the Ministry of Corporate Affairs on 22nd October, 2021.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. MKB & Associates, a firm of Company Secretaries in Practice, (Firm Registration no. P2010WB042700) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith and marked Annexure-1. The report is self-explanatory and do not call for any further comments.

In terms of Regulation 24A of LODR, Star Cement Meghalaya Limited, a material subsidiary is under secretarial audit and report submitted by the Secretarial Auditors is annexed herewith and marked Annexure - 1A. The report is selfexplanatory and do not call for any further comments.

REPORTING OF FRAUD

The Auditors of the Company have not reported any fraud as specified under section 143(12) of the Companies Act, 2013.

BUSINESS RESPONSIBILITY REPORT

As required under Regulation 34 of SEBI Listing Regulations 2015, the Business Responsibility Report of the Company for the financial year ended 31st March, 2022 is attached as part of the Annual Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, your Company has not made any investment or provided guarantee or security in connection with a loan to any person exceeding the limit specified in Section 186 of the Companies Act, 2013.

Details of Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in notes to the financial statements.

RELATED PARTY TRANSACTIONS

All related party transactions are entered on armâs length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. In terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, the particulars of the material contract or arrangement entered into by the Company with related parties as referred to in section 188 in form AOC-2 is attached as Annexure- 2 of this report. However, the details of the transactions with the Related Party are provided in the Companyâs financial statements in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

A policy on ''Related Party Transactionsâ has been devised by the Company which may be referred to at the Companyâs website at the weblink:

https://www.starcement.co.in/upload/images/files/

Revised-Related-Party-Policy.pdf

RESERVES

During the year under review no amount was transferred to reserves. However, in accordance with Section 69 of the Companies Act, 2013, the Company has created a Capital Redemption Reserve of '' 82,48,580 equal to the nominal value of Shares bought back as an appropriation from General Reserves.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

(A) Steps taken toward Conservation of energy:

â¢ PPC Cement production rate increased by 3-5 Tph due to addition of Fly ash at Mill outlet, so that leads to annual power saving @ 2 Kwh/Mt Cement.

â¢ Primary Air blower Pulley diameter increased, so

that RPM reduced by 293, due to that power saving

0. 48 Kwh per year.

â¢ Due to replacement of existing street lights by LED fittings a total 1.995 Lakhs Kwh power was saved during the year.

â¢ HAG Dilution Air Fan Installation of VFD in place of DOL starter resulted in reduction in power and Savings of 14,400 KW per month and approx. '' 95,000 per Month.

â¢ 22 Watt LED Lights replaced with 36 watt CFL at CCR Building offices resulting in reduction in consumption by 39% will save approximately '' 3,000 per month.

â¢ Use of Bio Mass helped in reducing over reliance on conventional fuel.

â¢ Installation of waste heat recovery boiler enabled to reduce waste and energy consumption and increase the efficiency.

(B) Steps taken toward Technical Absorption:

a. Steps taken towards Technical Innovation:-

1. Packing plant Packer 1, 2 & 3 Bag Printing Machine Bag sensing Proximity Switch, replaced with Visible Infrared Type Sensor. This increased the availability of machine and also frequent cleaning and adjustment/ replacement of Sensor.

ii. ABB & Mitsubishi VFD Drives communication with Plant PLC is done by using Modbus communication instead of Hardwiring.

b. Steps taken towards technical absorption:-

i. For smooth operation of Truck loaders installed VFD in Trolley drive, this helped us in reducing down time of truck loader.

ii. 531-BC3 Motor and VFD of 7.5 KW replaced with 15 KW. Frequent tripping of Belt due to Overload is eliminated.

c. Steps taken towards technical adoption :-

i. Replacement of Old 3 star AC with New Inverter AC 5 star. This helped in energy savings and better cooling and operation.

ii. Replacement of Guide roller with Pipe pieces in Truck loader Rope for Hassle free operation, as guide roller was getting stucked during operation.

iii. 2 No. Drum motor is replaced with Geared motor, as drum motor mounting bracket was getting damaged frequently in Truck Loader Long belt.

â¢ The Company has developed a Research & Development cell for carrying out

R&D Projects in the plant with specific objective of development of advanced systems for quality improvement. During the year under review, your Company incurred Capital expenditure of '' 8.12 Lakhs (P.Y. '' 96.47 Lakhs) and Revenue Expenditure of '' 44.50 Lakhs (P.Y. '' 31.35 Lakhs) in Research & Development.

During the period under review, Foreign Exchange Earning was NIL (Previous Year - NIL) and the Foreign Exchange Outgo was '' 5.24 Lakhs (Previous Year '' 43.22 Lakhs).

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES (CSR)

Star Cement Limited has constantly been the pioneer of CSR activities in north-eastern and eastern region of the country. The Companyâs CSR policy primarily focuses on the need based sustainable holistic development of the neighbouring society since the day of its inception. Towards achieving long term stakeholder value creation, the Company continues to respect the interests of and be responsive towards our key stakeholders - the communities, especially those from socially and economically backward Groups, the underprivileged and marginalised and the society at large. Your Company is known for its philantrophic activities and actively taking several activities under its Corporate Social Responsibility Initiatives. Your Company feels that meeting obligations of CSR is not a statutory requirements but it goes beyond any parameters. Pursuant to Section 135 of the Companies Act, 2013 read with Schedule VII thereof and Rules made thereunder, your Companyâs social responsibility policy is offering number of community welfare projects in the field of Health & Sanitation, Education, Eradication of hunger & proverty, Environment sustainability, Sustainable Livelihood & Skills building, Rural & infrastructure development for the local inhabitants of plant operational areas during the year FY 21-22 to improve the quality and standard of living. Your Company undertook various activities during the year FY 2122 under review in line with its CSR Policy.

The composition of CSR Committee of your Company, attendance at the said Meeting, terms of reference of the CSR Committee and other relevant details have been provided in the Corporate Governance Report forming part of the Annual Report. The CSR Committee has confirmed that the implementation and monitoring of CSR Policy is in conformity with CSR objectives and policy of the Company and in compliance with Section 135 of the Companies Act, 2013.

Your Companyâs Policy on Corporate Social Responsibility can be accessed on the Companyâs website at https://www. starcement.co.in/upload/images/files/CSR-Policy-2021-1. pdf

Annual Report on CSR as required to be annexed in terms of requirement of Section 135 of Companies Act, 2013 and rules framed thereunder is annexed herewith and marked Annexure- 3.

EVALUATION OF THE BOARD''S PERFORMANCE

In accordance with the requirements of the Companies Act 2013, the performance evaluation of the Board was carried out during the year under review. The Board follows a formal mechanism for the evaluation of the performance of the Board as well as Committee. The evaluation reflected the overall engagement of the Board and the Committee.

The Nomination and Remuneration Committee at its meeting established the criteria based on which the Board evaluate the performance of the Directors.

The Directors expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

On the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on 13th August, 2021 appointed Mr. Prem Kumar Bhajanka, Non -Executive Director as the Managing Director of the Company with effect from 13th August, 2021 upto 31st March, 2024, which was duly approved by the shareholders of the Company by way of special resolution passed in the Annual General Meeting held on 30th September, 2021.

Mr. Santanu Ray, Independent Director retired from the Board with effect from close of the business hours of 31st March, 2022 due to completion of his second and final terms of appointment as Independent Director. Your Board of Directors record their appreciation for the valuable services and guidances rendered/given by Mr. Santanu Ray during his association with the Company as a member of the Board and various Committees.

Mr. Sanjay Kumar Gupta, Chief Executive Officer and Key Managerial Personnel of the Company has resigned from the services of the Company with effect from close of the business hours of 31st January, 2022. The Board places on record its appreciation for the services rendered by Mr. Sanjay Kumar Gupta during his association with the Company. On the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on 25th January, 2022 has appointed Mr. Sajjan Bhajanka, Chairman & Managing Director of the Company as the Chairman, Managing Director & Chief Executive Officer and Key Managerial Personnel of the Company with effect from 01st February, 2022.

Mrs. Ibaridor Katherine War (DIN: 03107920) and Mrs. Plistina Dkhar (DIN: 01375361) were appointed as the Independent Directors of the Company for a period of 5 (five) years by the shareholders of the Company upto 31st March, 2022. On the recommendation of the Nomination & Remuneration Committee and based on the performance evaluation, the Board of Directors at its meeting held on 25th January, 2022 re-appointed Mrs. Ibaridor Katherine War and Mrs. Plistina Dkhar as the Independent Directors for a second and final term of 5 (five) consecutive years effective from 1st April, 2022 upto 31st March, 2027, which were duly approved by the shareholders of the Company by way of special resolutions passed through postal ballot by way of voting through electronic means concluded on 15th April, 2022.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors at its meeting held on 25th January, 2022 appointed Mr. Nirmalya Bhattacharyya (DIN: 09037566) as an Additional Director in Independent category for a period of 5 (five) years effective from 1st February, 2022 upto 31st January, 2027. In terms of Regulation 17(1C) of the Listing Regulations, the listed entity is required to obtain approval of the shareholders for the appointment of new Director at the next General Meeting or within a time period of three months from the date of appointment, whichever is earlier. Accordingly, the shareholders of the Company approved the appointment of Mr. Nirmalya Bhattacharyya as an Independent Director of the Company for an intital term of 5 (five) consecutive years effective from 1st February, 2022 upto 31st January, 2027, by way of special resolution passed through postal ballot by way of voting through electronic means concluded on 15th April, 2022.

Mr. Nirmalya Bhattacharyya, aged 72 years, is a First Class Master Degree holder in Statistics having more than 51 years of rich experience in Banking, Finance, Accounts, Administration and Social services. He is an Executive Director of Friends of Tribal Society and also an Administrator of MBIT sets of instruments. His association as Director would be beneficial to the Company.

Mr. Nirmalya Bhattacharyya has given his consent for appointment and has confirmed that he retains his status as Independent Director and does not suffer from any disqualifications for appointment.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors at its meeting held on 25th January, 2022, appointed Mr. Brij Bhushan Agarwal (DIN: 01 125056) as an additional director in Non-Executive category of the Company. In terms of Regulation 17(1C) of the Listing Regulations, the listed entity is required to obtain approval of the shareholders for the appointment of new Director at the next General Meeting or within a time period of three months from the date of appointment, whichever is earlier. Accordingly, the shareholders of the Company approved the appointment of Mr. Brij Bhushan Agarwal as a Non-Executve Director of the Company, by way of special resolution passed through postal ballot by way of voting through electronic means concluded on 15th April, 2022.

Mr. Brij Bhushan Agarwal, aged about 50 years, is a commerce graduate from University of Calcutta and having more than 3 decades of experience in managing business, strategic planning, future expansion, business development, marketing, human resources and corporate affairs etc.,

Mr. Brij Bhushan Agarwal has given his consent for appointment and has confirmed that he does not suffer from any disqualifications for appointment.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors at its meeting held on 25th January, 2022, appointed Mr. Pankaj Kejriwal (DIN: 00383635), Non-Executive Director of the Company, as a Wholetime Director and Chief Operating Officer (COO) of the Company with effect from 1st February, 2022 upto 31st March, 2024, which was duly approved by the shareholders of the Company by way of special resolution passed through postal ballot by way of voting through electronic means concluded on 15th April, 2022.

In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Prem Kumar Bhajanka and Mr. Pankaj Kejriwal will retire by rotation and being eligible, offer himself for re-appointment. In view of his considerable experience, your Directors recommend his re-appointment as Director of the Company.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and they have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and the Listing Regulations. Mr. Pramod Kumar Shah, Mr. Nirmalya Bhattacharyya (w.e.f. 1st February, 2022), Mrs. Ibaridor Katherine War, Mrs. Plistina Dkhar and Mr. Amit Kiran Deb are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in section 149 of the Act and the Rules made thereunder and the Listing Regulations about their status as Independent Director of the Company.

Your Board of Directors formed opinion that the Independent Directors of the Company are maintaining highest standard of integrity and possessing expertise, requisite qualifications and relevant experience in the fields of Administration, General management, Accounts & Finance, Audit , Internal Audit, Taxation, Risk, Board procedures, Governance etc., for performing their role as Independent Directors of the Company. Regarding proficiency, all Independent Directors have registered themselves in the Data Bank maintained with the Indian Institute of Corporate Affairs (IICA), Manesar. In terms of Section 150 of the Act read with Rule 6(4) of the Companies (Appointment & Qualification of Directors) Rules, 2014, the Independent Directors are required to undertake online proficiency self- assessment test conducted by the IICA within a period of 2 (two) years from the date of inclusion of their names in the data bank. Mr. Santanu Ray, Mr. Amit Kiran Deb, Mrs. Ibaridor Katherine War, Mrs. Plistina Dkhar, Independent Directors are exempted from qualifying ''online proficiency testâ due to their relevant experience in listed companies and the Companies with Paid up equity Capital is '' 10 Crore and more. Mr. Pramod Kumar Shah was appeared in ''online proficiency testâ within the period of 1 (one) year from the date of inclusion of his name in the data bank and has successfully qualified the test. Mr. Nirmalya Bhattacharyya (appointed w.e.f. 01st February, 2022) will appear in ''online proficiency testâ within the period of 2 (two) years from the date of inclusion of his name in the data bank.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

In order to enable the Independent Directors to perform their duties optimally, the Board has devised a familiarisation programme for the Independent Directors to familiarise them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. They are periodically updated about the development which takes place in the Company. At the time of appointment of an Independent Director, the Company issues a formal letter of appointment setting out in detail, the terms of appointment, duties, responsibilities and commitments etc. The familiarisation program is available on the Companyâs website under the web link:

https://www.starcement.co.in/upload/images/files/

Familiarization-Programme.pdf

SUBSIDIARIES AND ASSOCIATE COMPANY

Star Cement Meghalaya Limited is engaged in manufacturing of Cement Clinker and has a Clinkerisation plant with an installed capacity of 1.75 MTPA. During the year under review, the Company manufactured 16,54,582 MT of clinker as against 14,75,660 MT in FY 20-21.

Megha Technical & Engineers Private Limited is engaged in the manufacture of cement. During the year under review, the Company produced 3450 MT of Cement.

Meghalaya Power Limited, a wholly-owned subsidiary, is engaged in generation of Power. During the year under review the Company generated 123 Mn units of power.

NE Hills Hydro Limited, wholly owned subsidiary of your Company is currently not operational.

CHANGES IN NATURE OF BUSINESS, IF ANY

There has not been any change in the nature of business.

AUDITED FINANCIAL STATEMENTS OF THE COMPANY''S SUBSIDIARIES

Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement for the year ended 31st March, 2022 for each of the Companyâs subsidiaries viz. Star Cement Meghalaya Limited (SCML), Megha Technical & Engineers Private Limited (MTEPL), Meghalaya Power Limited (MPL), NE Hills Hydro Limited (NHHL), Star Century Global Cement Private Limited (SCGCPL), Star Cement (I) Limited (formerly, Star Cement Lumshnong Limited) and Star Cement North East Limited are annexed in the Form AOC - 1 and marked as Annexure-4.

CONSOLIDATED FINANCIAL STATEMENTS

The detailed financial statements and audit reports of each of the subsidiaries of the Company are available for inspection at the Registered Office of the Company during office hours between 11 A.M. and 1 PM. The Company will arrange to send the financial statements of the subsidiaries upon written request from a shareholder to the registered address of the said shareholder.

DEPOSITS

SIGNIFICANT MATERIAL ORDERS PASSED BY THE COURTS OR REGULATORS

(i) The Director of Mineral resources, Meghalaya, Shillong vide its Demand notice dated 19th February, 2020 raised a demand against the Company for payment of royalty, MEPRF, VAT/GST for an amount of '' 4184.06 Lakhs in pursuance to the National Green Tribunal (NGT) order dated 17th January, 2020 passed in O.A. No. 110 (THC)/2012 against the Company and other Cement and Power Companies in Meghalaya for alleged illegal coal procurement.

Accordingly, the Company has preferred an appeal before the Appex Court which is pending and accordingly no provisions has been made in the accounts. (Refer Note no. 48(a)b of Notes to Accounts).

Other than the aforesaid, there have been no significant and material orders passed by the Courts/ Regulators impacting the going concern status and future operations of the Company.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes or commitments have occurred between the end of the financial year and the date of this Report which affect the financial statements of the Company in respect of the reporting year.

CREDIT RATINGS

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Board ofDirectors of the Company on the recommendation of the Audit Committee, re-appointed M/s. Anita Sahal & Associates, Chartered Accountants, as the Internal Auditors of the Company for the Financial Year 22-23 under section 138 of the Companies Act, 2013. M/s. Anita Sahal & Associates, have confirmed about their re-appointment. The Internal Auditors monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations, if any, along with corrective actions thereon are presented to the Audit Committee of the Board.

INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design or operations were observed. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

DETAILS OF SIGNIFICANT CHANGES (I.E., CHANGES OF 25% OR MORE) IN KEY FINANCIAL RATIO AND CHANGE IN RETURN ON NETWORTH ALONGWITH DETAILED EXPLANATIONS
Key Financial ratios	FY 21-22	FY 20-21	% change	Explanation for Significant Changes
Debtors Turnover ratio	16.74	13.96	19.91	NA
Inventory Turnover ratio	16.00	12.79	25.11	Due to increase in demand in comparison with last year
Interest Coverage ratio	20.62	18.54	11.22	NA
Current ratio	1.96	2.27	(13.59)	NA
Debt Equity ratio	0.06	0.10	(38.77)	Due to repayment of unseucred loan
Operating Profit Margin (%)	7.33	11.61	(36.86)	Due to increase in raw materials & power fuel cost.
Net Profit Margin (%)	8.11	9.47	(14.36)	NA
Return on Net Worth (%)	13.57	12.33	10.05	NA

MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES

The disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 along with a statement containing particulars of employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith and marked Annexure- 5 and forms part of this report.

DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016

There was no application made or proceeding pending against the Company under the Insolvency and Bankruptcy Code, 2016, during the year under review.

DETAILS OF DIFFERENCE IN VALUATION

The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements as stipulated under the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). A separate section on corporate governance, along with a certificate from the auditors confirming the compliance, is annexed and forms part of the Annual Report. This certificate will be forwarded to the Stock Exchanges along with the Annual Report of the Company.

CHIEF EXECUTIVE OFFICER (CEO) /CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI), the CEO/ CFO certification has been submitted to the Board and a copy thereof is contained in this Annual Report.

RISK MANAGEMENT

Risk management refers to the practice of identifying potential risks in advance, analysing them and taking precautionary steps to reduce the risk. The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.

HUMAN RESOURCE DEVELOPMENT & INDUSTRIAL RELATIONS

The year 20-21 saw the outbreak of COVID 19 Pandemic and organiations were affected globally and were forced to change their strategies to survive through the Pandemic. At Star Cement, HR was extremely proactive in managing the crisis and ensuring the safety and wellbeing of its employees. With the beginning of the new Financial Year 21-22, the COVID-19 pandemic was far from over, but there was the light at the end of the tunnel as more and more people got vaccinated and HR helped in organising free vaccinations camps for employees across locations.

With the objective of creating new benchmarks in adherence to Safety standards and have Quick Response Team in case of fire exigencies and accidents, a series of Fire Safety and First Aid Certification Training Programs were conducted at Lumshnong, Sonapur and Siliguri Plants.

Talent acquisition strategy and processes were re-looked at. In order to attract best talent, employer branding was focused on, wherein innovative ways of using social media were explored. In these challenging times, HR was successful in getting on board the required Manpower at the newly commissioned Siliguri Grinding Unit.

Towards making the organisation more progressive and future looking, HR proactively and systematically reviewed existing policies and accordingly revised them in accordance with the industry standards and employee needs.

Group Mediclaim Policy gives financial security for self and family members against any medical emergency. HR worked in evaluating and designing most appropriate GMC policy for the employees of Star Cement which has been implemented from May, 2022.

With the focus on performance and productivity, the Performance Management System (PMS) has been revamped. People Development goals have been introduced to create a culture of employee development and feedback. The Performance Linked Incentive (PLI) is made sharper and simpler.

Over the last few months, HR has taken some significant steps towards making the HR function futuristic by way of structural, systemic improvements and changes. A major milestone has been the tax friendly salary re-structuring, followed by the standardisation of salary structures across locations leading to equity, simplicity and greater visibility.

Industrial Relations have been effective with several interventions & good practices. During the year gone by, there has not been any material changes in human resources and industrial relations as proactively employee welfare related aspects were addressed and taken care of.

AWARDS AND ACCOLADES

During the year under review, your Company was felicitated with the prestigious SCALE 2020 (Supply Chain and Logistics Excellence) award by the Confederation of Indian Industry (CII) for outstanding achievement in the cement categorydriving innovation and transformation consistently for the second consecutive year.

Additionally, Star Cement was also awarded with Rotary RMB Connect 2021 Award in association with The Economic Times for the most trusted invaluable service and excellence in the category of Cement Industry in 2021.

GREEN INITIATIVES IN CORPORATE GOVERNANCE

Ministry of Corporate Affairs has permitted Companies to send copies of Annual report, Notices, etc., electronically to the email IDs of shareholders. Your Company has arranged to send the soft copies of these documents to the registered email IDs of the shareholders, wherever applicable. In case, any shareholder would like to receive physical copies of these documents, the same shall be forwarded upon receipt of written request in this respect.

Pursuant to the MCA and SEBI circulars, in view of the prevailing situation of the Pandemic, owing to the difficulties involved in dispatching of the physical copies of the Notice of the 21st AGM and the Annual report of the Company for the financial year ended 31st March, 2022 are being sent only by email to the Members. A newspaper advertisement in this regard is being published.

CAUTIONARY STATEMENT

Statements in this report describing the Companyâs objectives, expectations or predictions, may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companyâs operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in Government policies and tax laws, economic development of the country, potential impact of the ongoing COVID-19 pandemic and related public health issues on economy of country, our business, the businesses of our customers, vendors and partners and other factors which are material to the business operations of the Company.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their deep sense of gratitude to Banks, Central and State Governments and their departments and the local authorities, customers, vendors, business partners/associates for their continued guidance and support.

The Directors regret the loss of life due to Covid-19 pandemic and are deeply grateful and have immense respect for every person who risked their life and safety to fight this pandemic.

Your Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Company and dedicates the credit for the Companyâs achievements to them. Last but not least, your Directors express their gratitude to the shareholders of the Company for reposing their confidence and faith in the Management of the Company and look forward for their support in future.

For and on behalf of the Board of Directors

SAJJAN BHAJANKA

Place: Kolkata CHAIRMAN

Date: 17th May, 2022 (DIN: 00246043)

Mar 31, 2018

Dear Memberâs

The Directors have pleasure in presenting Seventeenth Annual Report of the Company together with the Audited Balance Sheet as at March 31, 2018 and the Statement of Profit & Loss for the year ended on that date.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the financial year ended March 31, 2018 as compared to the previous financial year are as under:

(Rs. in Lacs)

Particulars	Consolidated		Standalone
	2017-18	2016-17	2017-18	2016-17
Net Sales / Income	1,63,349.21	1,55,427.61	1,48,759.25	1,34,558.25
Profit before Interest, Depreciation and Tax	52,573.74	41,076.99	32,872.77	18,259.92
Interest & Finance Charges	5,245.74	7,806.14	4,343.37	5,615.49
Depreciation	12,068.65	11,791.15	5,745.45	4,035.36
Profit/(Loss) before Tax	35,259.36	21,479.70	22,783.95	8,609.07
Provision for taxation:
- Current Tax	7,326.93	4,177.11	4,877.74	1,706.63
- Deferred Tax	(5,685.62)	(2,787.28)	(3,171.44)	(1,100.00)
Net Profit after Tax	33,618.05	20,089.87	21,077.65	8,002.44
Other comprehensive income for the year, net of tax	(28.29)	5.16	(13.18)	9.10
Total comprehensive income for the year	33,589.76	20,095.03	21,064.47	8,011.54
Net profit attributable to:
Owners of the company	33,065.62	19,472.35	-	-
Non-controlling interest	552.43	617.52	-	-
Total	33,618.05	20,089.87	-	-
Other Comprehensive Income attributable to:
Owners of the company	(27.43)	5.93	-	-
Non-controlling interest	(0.86)	(0.77)	-	-
Total	(28.29)	5.16	-	-
Total Comprehensive Income attributable to:
Owners of the company	33,038.19	19,478.28	-	-
Non-controlling interest	551.56	616.76	-	-
Total	33,589.76	20,095.03	-	-
Proposed Dividend:
Proposed Dividend @ Rs.1/- per share	4,192.29	-	4,192.29	-

INDIAN ACCOUNTING STANDARDS

As per notification dated 16th February, 2015 issued by the Ministry of Corporate Affairs, the Company has adopted the Indian Accounting Standards (âInd ASâ) notified under the Companies (Indian Accounting Standards) Rules, 2015 with effect from 1st April, 2017. Accordingly, Financial statements for the year ended 31st March, 2017 have been restated to conform to Ind AS. The reconciliations and descriptions of the effect of the transition from IGAAP to Ind AS have been provided in the notes to accounts in both the Standalone and Consolidated Financial Statements.

OPERATIONAL REVIEW

Despite challenges faced by the economy on account of introduction of Goods & Service Tax (GST) during first two quarters of the financial year, your company has been able to maintain the operational performance. During the year under review, your Company has manufactured 5,15,350

MT of Cement Clinker as against 5,67,241 MT recorded during the FY 2016-17. Companyâs subsidiary M/s. Star Cement Meghalaya Limited produced 15,41,945 MT of Clinker as against 15,79,345 MT during the FY 2016-17. On consolidated basis total clinker production during the year was at 20,57,295 MT as against 21,46,586 MT during FY 2016-17.

There has been recorded decrease in volume of sales but sharp improvement in profit. During the year under review the Company has received subsidies from the Central Government under Capital Subsidy Scheme and the said amount has been utilized towards prepayment of loan. It is expected that your Company will be a debt free Company in next year.

In terms of capacity utilization, clinkerization unit of your Company was able to utilize 65.07% of its installed capacity as against 71.60% during the FY 2016-17. Similarly, the capacity utilization of clinkerization unit of its subsidiary M/s. Star Cement Meghalaya Limited was at 88.16% during FY 2017-18 as against 90.30% during the FY 2016-17. On consolidated basis, the capacity utilization of clinkerization units was at 80.96% during the FY 2017-18 as against 84.48% during FY 2016-17.

Your Company has been able to maintain the performance on grinding front too. During the year under review, total cement production on consolidated basis was at 24,07,955 MT (including volume from hired grinding units) as against 27,08,430 MT during the FY 2016-17.

Similarly, your Company has been able to achieve sales volume of 24,04,423 MT of Cement as against 27,37,437 MT during the previous financial year.

Due to sluggish market demand, devastating flood in Bihar, Assam, North Bengal and reverse sand availability in Bihar there was fall in volume of sales and under utilisation of capacity. However, your Company expects to improve its operational performance during the ensuing financial year.

DIVIDEND

Your Directors are pleased to recommend a Final dividend @ 100% i.e., RS.1/- each per Equity Share of Face Value of RS.1/-each (exclusive of applicable Dividend Distribution Tax) for the Financial Year ended 31st March, 2018.The Final dividend, subject to approval of members at the ensuing Annual General Meeting, will be paid within the statutory period.

AMALGAMATION

Your Company has taken a proposal for merger of Megha Technical & Engineers Private Limited, a wholly owned subsidiary Company with the Company with effect from 1st April, 2018, i.e., the Appointed Date. The Scheme is subject to necessary statutory and regulatory approvals including approval of the Honâble National Company Law Tribunal. Since both the Companies are engaged in the business of cement manufacturing, upon the scheme becoming effective the business of both the Company can be carried more efficiently and economically as one entity.

INDIAN ECONOMY AND OUTLOOK - AT A GLANCE

Indian economy has been appeared as the fastest growing economy in the world as per report of Central Statistics Office and International Monetary Fund. Over the next 10-15 years, Indian economy is expected to be one of the top 3 economic powers of the world. With the Governmentâs thrust to reform, GDP have increased to 6.6% and it is expected to grow around 7.3% in 2018-19. There has been significant growth in tax collection figures. Foreign Direct Investment reached to USD 208.99 billion during April 2014-December 2017 and foreign exchange reserve was USD 422.53 billion till week ended March 23, 2018.

The Union Budget for the financial year 2018-19 mainly focused on strengthening agricultural sector, health care for under privileged sector, infrastructure development and education of the Country. There has been all time high budget allocations for rail and road sectors and budgetary allocation for infrastructure sector has been set to RS.5.97 lakh crore. Government allocation of RS.4,200 crore towards Green Energy Corridor Project alongwith other wind and solar power projects.

Government initiatives for âMake in Indiaâ and âDigital Indiaâ attracts foreign companies for setting up their business in India. âMake in Indiaâ initiative boost the manufacturing sector as a result helping development of the country. Contributions from the manufacturing sector expected to rise to 25% of GDP from present level of 17%.

With the initiatives of the Government by way of globaisation, digitization and reforms, countryâs Gross Domestic Product is expected to reach USD 6 trillion by the Financial Year 2027. For the reasons India is expected to be third largest consumer economy in the world.

CEMENT INDUSTRY OVERVIEW

India is occupying second position amongst the cement producer countries in the world and the industry plays a vital role in the development of the countryâs economy. Post deregulation, sector attracted huge investment from the country and abroad and thereby created a large number of direct and indirect employment.

The country has a huge scope for development in cement sector as there are lot of potential for development in housing and construction sector. Governmentâs initiatives for development of âSmart citiesâ and âHousing for allâ will boost the development of the cement sector. Governmentâs focus for development of infrastructure sector is expected to grow cement industry in 6-7%. However, countryâs per capital consumption of cements still at around 225 kg. The Government has launched missions like the Pradhan Mantri Awas Yojana, Atal Mission for Rejuvination and Urban Transformation and Swachh Bharat Mission in order to ensure living habitation for poor. In view of increasing domestic demand in certain specified sector like industrial construction, commercial construction and housing sector, the capacity of the cement industry of the country is expected to reacRs.500-600 MTPA by 2025.

NORTHEAST SCENARIO - GATEWAY OF OPPORTUNITIES

The North Eastern Region of the Country comprising of eight states are very rich in natural resources. Post-independence era and after partition the region became land locked and lost its easy access to ports and rest parts of the country. As a result, it witnessed lack of development in comparison with other states of the country. The Government of India has taken several measures to accelerate growth of the North East Region (NER).

On the infrastructure fonts, long awaited attention has been given for the development. The total budgetary allocation for the NER for the financial year 2018-19 has been set RS.47,994.88 crores which is significantly higher of RS.7,023.19 crores for the financial year 2017-18. The budget of Development of North Eastern Region (DoNER) Ministry has also been hiked from RS.2,737 crores for the financial year 201718 to RS.3,060 crores. As a result, certain mega infrastructure projects, roads, bridges, expansion of existing power projects have been undertaken in the region. A total of 20 major railway projects for laying of 13 new rail lines, gauge conversions, laying of double tracks, construction of new stations have been initiated. The budget also provided RS.1,014.09 crores under UDAN scheme for construction of new and expansion of present and revival of defunct airports, heliports and advanced landing grounds. Under the Bharatmala Pariyojana, construction of 5301 km of roads have been approved and out of whicRs.3,246 km road for development of Economic Corridor in NER. Works for India-Myanmar-Thailand Trilateral Highway has been awarded in December, 2017. New 92 routes will be opened under the UDAN Scheme. Educational and medical facilities have improved a lot in the region during last few years. Connectivity within NER States and with rest of India has also improved with initiatives taken towards infrastructure development. This has resulted into improved purchasing power with people at large in the Region.

The aforesaid developments and initiatives present a promising future for cement industry in the North East Region.

Market Development

North East Market as a strategy continued as focus market for your company. Cement demand was good in 1st quarter but was impacted during the 2nd quarter after implementation of GST. Your company organized seminars for dealers and sub dealers giving training on GST and enabled them to understand the benefits of GST. The Second half of FY 201718 was very positive and the Company recorded growth of approximately 7% YOY Your company was able to maintain volume in NER, and closed a little higher compared to the previous year. During the year under review your company was able to sell 17,51,508 MT of cement in NER market as against 17,39,263 MT during the FY 2016-17. During the year under review around 14 % of the total cement demand in NER was catered to by the industry through imports from other regions including Bangladesh and Bhutan.

Clinker demand was good in Eastern Nepal and Bhutan. Your company grabbed this opportunity and has achieved export of 1,38,508 MT Cement Clinker during the entire year under review as against 51,406 MT recorded in previous year.

As a market leader in NER your company has further consolidated dealers and sub dealerâs network. Sub dealers were given status as âRising Starâ with a nominal security deposit. All such sub dealers are linked with a particular dealer. This exercise is yielding good results and further strengthening our reach throughout our areas of operation.

During the year under review your Company has undertaken various marketing initiatives in order to make the brand âStar Cementâ more visible and attain top of mind recall. A unique Brand Campaign named âBhaag North East Bhaagâ was launched in North East. This was North Eastâs first International Half Marathon and people in thousands participated in the event with the Honourable Chief Minister of Assam Mr. Sarbananda Sonowal and Bollywood Star Bipasha Basu flagging off the event. The uniqueness was that all participants were offered 50% discounts on groceries to encourage people to participate. The Half Marathon also has a social cause of âClean Indiaâ associated with it. Other initiatives included retail and mass branding initiatives in the form of retail boards, cuboids, hoarding at shop, TV, Radio, Print and OOH ads. To make the brand more visible in remote areas, a block level branding campaign was undertaken through wall wraps, rural vans and rural theatres.

PRODUCTION AND COST DEVELOPMENTS Fly Ash

Your Company continued to promote environment friendly blended cement using fly ash and produced 17,01,504 MT of Portland Pozzolana Cement (PPC) (including from hired grinding units) on consolidated basis out of total production of 24,07,955 MT of cement during FY 2017-18. Usage of fly ash in cement is not friendly to environment only but also provides cost optimization. Your Company has been able to utilize the fly ash generated by power plant of its subsidiary M/s. Meghalaya Power Limited and such close access to fly ash provides competitive edge to your Company in term of cost. In addition, your Company has also made arrangements with major power plants like NTPC, Tata Power and few others to ensure its long term requirement of fly ash.

Power cost

During the year under review too, your Company continued to source its power requirement for its Lumshnong unit from its subsidiary M/s. Meghalaya Power Limited under long term arrangement for supply of quality power at competitive rates and thus, has been able to reduce dependency on grid power. To optimize the power cost and to reduce dependency on State supplied grid power, your Company has been able to source its power requirement of its Grinding Unit at Guwahati from Indian Energy Exchange (IEX), in addition to sourcing of power from State Grid. The blend of sourcing has not only reduced power cost for your Company but also its quality and dependability.

Logistics and Freight

Logistics function faced serious cost pressures during the year under review. Diesel price increased by 17% during the year. Such cost pressures were braved out by re-aligning distribution network resulting in 14% reduction in Wtd. Avg. Lead to 283 KM as against 329 KM during previous year. Wtd. Avg. Freight marginally increase by 1.8% to RS.1,133/- as against RS.1,113/- during previous year.

As a new initiative, cost effective âInland Water Transportâ was used as a pilot project in collaboration with IWAI for transportation of cement from Guwahati plant to various destination. Inauguration of such maverick effort of IWAI and your company was done by The Union Transport Minister Sri Nitin Gadkari and The Chief Minister of Assam Sri Sarbananda Sonowal. Such efforts are being taken forward and more movement by Waterways are undertaken.

Construction of Railway Siding at Guwahati Grinding Unit is at very advance stage and expected to commission by Julyâ18. Once the private siding gets operational, it would have a distinct cost advantage in logistic operations of the company.

KEY PERFORMANCE HIGHLIGHTS

- Consolidated cement production (including purchase from hired grinding units) was at 24.07 Lac MT during the year as against 27.08 Lac MT during the previous financial year.

- Consolidated net sales at RS.1,633.49 Crores during the year under review as compared to RS.1,554.27 Crores during the financial year 2016-17.

- Consolidated EBIDTA was at RS.525.73 Crores during the year under review as compared to RS.410.76 Crores during the immediate previous financial year.

- Consolidated profit before tax during the year 2017-18 was at RS.352.59 Crores as against a profit of RS.214.79 Crores in the year 2016-17, registering a growth of 64%.

OPPORTUNITIES AND THREATS, RISKS AND CONCERNS

India stood second position in cement producing countries in the world. Countryâs cement industry is expected to grow at CAGR of 9-10% during the financial year 2014-15 to 2018-19. Per capita cement consumption is much lower than the world per capita consumption. Government several initiatives in the areas of development of Ports, Roads and Highways, dedicated Freight Corridors, Gauge conversion Projects undertaken by Railways, development in the area of alternative source of energy viz. Hydro and Solar Power and other infrastructure projects is expected to boost Cement and Power Demand of the country. Make in India initiatives, positive moves on the policy front, in areas related to ease of doing business, promoting start-ups, rationalising the tax structure and administration, and opening up more areas for foreign investment through the automatic route will also increase the demand of cement and power.

Cement demand is very much linked to the economic growth and development of infrastructure and housing sector. In case growth rates affected by any unforeseen reasons, cement demand may also be affected. Cement and power industry being majorly dependent upon availability of raw materials at affordable cost. Policies of the Government as well as Central and State Laws may adversely affect the availability of lime stone, coal etc. Any major changes in Governmentâs Environmental and Forest regulations may affect limestone availability to cement plants. Competition from the foreign players may lead to tougher competition to the domestic players. The Company enjoys various subsidies from the Government, roll back of any subsidies may have a negative impact on the profitability.

LISTING OF SHARES AND SHARE CAPITAL

Your Company got listed with National Stock Exchange of India Limited and BSE Limited with effect from 16th June, 2017.

Pursuant to merger of erstwhile Star Ferro and Cement Limited into the Company, the Authorized Share Capital of the Company has increased to RS.83,00,00,000 divided into 83,00,00,000 Equity Shares of RS.1/- each. In line with terms of Scheme of Amalgamation, 29,54,90,077 (Twenty Nine Crore Fifty Four Lakh Ninety Thousand Seventy Seven) equity shares of the Company were allotted on 8th April, 2017 to the shareholders of erstwhile Star Ferro and Cement Limited in the ratio of 1.33 equity shares of RS.1 each of the Company for every 1 (one) equity share of RS.1 each of erstwhile Star Ferro and Cement Limited held by them as on the record date i.e. 3rd April, 2017. After the said allotment the total number of equity shares of the Company has aggregated to 41,92,28,997 of RS.1 each.

The paid up Equity Share Capital of the Company as on March 31, 2018 was RS.41,92,28,997/- divided into 41,92,28,997 equity shares of RS.1/- each.. During the year under review, the Company has neither issued any shares with differential voting rights nor granted stock options or sweat equity shares.

EXTRACT OF ANNUAL RETURN

In terms of requirement of section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual return in form MGT-9 is annexed herewith and marked Annexure-1.

MEETINGS OF THE BOARD

During the year six (6) Board Meetings and four (4) Audit Committee Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. The details of the Board meeting and the Committee meeting are provided in the Corporate Governance Report.

MEETINGS OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent Directors was held on 06th March, 2018 wherein the performance of the Non-Independent Directors and the Board as a whole was reviewed. The Independent Directors at their meeting also inter alia assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.

COMMITTEES OF THE BOARD

The composition and terms of reference of the Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee have been furnished in the Corporate Governance Report forming part of this Annual Report. There has been no instance where the Board has not accepted the recommendations of the Audit Committee and Nomination and Remuneration Committee.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Whistle Blower Policy/ Vigil Mechanism as required under Section 177 of the Companies Act, 2013 and as per Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). The Vigil (Whistle Blower) mechanism provides a channel to the employees and Directors to report to the management, concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said policy may be referred to at the Companyâs website at the web link: http://starcement.co.in/wp-content/uploads/Whistle-Blower-Policy.pdf

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT EMPLOYEES

The Board has framed a Remuneration Policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management Employees. The remuneration policy aims to enable the Company to attract, retain and motivate highly qualified members for the Board and at other executive levels. The remuneration policy seeks to enable the Company to provide a well-balanced and performance-related compensation package, taking into account shareholder interests, industry standards and relevant Indian corporate regulations. The details on the same are given in the Corporate Governance Report. The said policy may be referred to at the Companyâs website at the web link: http://starcement.co.in/wp-content/uploads/ Remuneration-policy.pdf

DIVIDEND DISTRIBUTION POLICY

In terms of Regulation 43A of the Listing Regulations, your Board has framed and adopted a Dividend Distribution Policy. The object of the policy is to share profit of the Company with the shareholders appropriately and also to ensure funds are available for the growth of the Company. The policy inter alia describes the circumstances under which the shareholders may or may not expect dividend, the financial parameters that shall be considered while declaring dividend, internal and external factors that shall be considered for declaration of dividend, policy for utilization of retained earnings and the parameters with respect to different classes of shares for the purpose of declaration of dividend. The said policy may be referred to at the Companyâs website at the web link: http:// starcement.co.in/wp-content/uploads/Dividend-policy.pdf

COMPLIANCE WITH THE SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards as recommended by the Institute of Company Secretaries of India.

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

- In the preparation of Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures, if any;

- The Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2018 and of the profit of the Company for the year under review;

- The Directors 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;

- The Directors have prepared the annual accounts on going concern basis;

- The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

- The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

AUDITORS AND AUDITORSâ REPORT

M/s. D. K. Chhajer & Co., Chartered Accountants (Firm Registration no. 304138E) Statutory Auditors of the Company, have been appointed by the members at the Sixteenth Annual General Meeting and shall hold office for a period of 5 years from the date of such meeting held on 11th September, 2017.

The notes to the accounts referred to in the Auditorsâ Report are self-explanatory and, therefore, do not call for any further comments.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its manufacturing activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, re-appointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the financial year ended 31st March, 2018 in the Board Meeting held on 30th May, 2017. The remuneration proposed to be paid to them for the financial year 2017-18, as recommended by audit committee, was ratified in the meeting of shareholders held on 11th September, 2017.

M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) have expressed their willingness and confirmed their eligibility to be appointed as Cost Auditors of the Company for ensuing financial year. The Board, on recommendation of the Audit Committee, has appointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the financial year 2018-19 subject to ratification of their remuneration by shareholders in the General Meeting of the Company.

The cost audit report for the Financial Year 2016-17 was filed with the Ministry of Corporate Affairs on 23.09.2017.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. MKB & Associates, a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith and marked Annexure-2. The report is self-explanatory and do not call for any further comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, your Company has not given any loan to any person falling under ambit of Section 186 of the Companies Act, 2013.

Details of Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 and the loans received from the Directors of the Company are given in the notes to the Financial Statements.

RELATED PARTY TRANSACTIONS

Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Accordingly, no transactions are being reported in Form AOC-2 in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014. However, the details of the transactions with the Related Party are provided in the Companyâs financial statements in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

A policy on âRelated Party Transactionsâ has been devised by the Company which may be referred to at the Companyâs website at the web link http://starcement.co.in/wp-content/ uploads/Related-Party-policy.pdf

RESERVES

During the year under review no amount was transferred to reserves.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

(A) Steps taken toward Conservation of energy:

- Expansion joints of Pre-heater outlet, raw mill inlet duct, coal mill hot air and Coal Mill booster fan inlet replaced resulting in a saving of 1 Kwh /MT of Clinker.

- Replacement of HPSV Light fitting with LED light fittings resultant saving of 1.85 lacs Kwh Per year

- Modification of EBC -05 Belt (Clinker feeding belt) leading to direct saving of drive Power of Clinker Bucket Elevator.

- Modified the shale hopper for easy flow of material to minimize the quality variation.

- Reduce Air requirement in raw mill discharge Bucket Elevator air slide by optimizing air material ratio, resulting one air blower stopped in the circuit.

- Installation of capacitor 50 KVAR in all 3 compressors

- Installation of 100 nos. LED for street lighting reducing wattage from 15 KW to 5 KW

(B) Steps taken toward Technical Absorption:

- National Counsel for cement and building material conducted diagnostic study for minimizing kiln builds ups Cement rotary kiln.

- Online monitoring of all 3 Compressors parameter through Modbus on plant SCADA

- The Company has developed a Research & Development cell for carrying out R&D Projects in the plant with specific objective of development of advanced systems for quality improvement. During the year under review, your Company incurred Capital expenditure of RS.6.38 Lacs and Revenue Expenditure of RS.34.43 Lacs in Research & Development.

During the period under review, Foreign Exchange Earning was NIL (Previous Year - NIL) and the Foreign Exchange Outgo was RS.914.60 Lacs (Previous Year RS.1203.01 Lacs).

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES (CSR)

As a responsible corporate citizen, Companyâs CSR initiatives have been playing a significant role in bringing steady transformation of the society with special focus on marginalized and underprivileged section. Business decisions of the company have always linked to the ethical values of âdo good for the communityâ and respect for people, communities and environment around the operational area and in nearby localities. Under the CSR purview, your Company along with its subsidiaries had prioritized need of the community under the following verticals:

SUSTAINABLE LIVELIHOOD

Your company has taken up sustainable livelihood programs in village areas where employment opportunities barely exist. These programmes were initiated to enhance the source of secondary income of individual households in Meghalaya and Assam. The component broadly includes the following interventions for ensuring sustainable livelihood for farm families

- Bee keeping project has been taken up in Sonapur and Lumshnong area as skill oriented initiative with low investment and high employment potential.

- Pig rearing project was initiated in Lumshnong and Sonapur area. Beneficiary households were supported with low cost pigsty in a shared value mode with distribution of high breed piglets (at free of cost) including training and veterinary support to enable the farmers for earning substantial income.

- Support to Eri Silk farmers in Assam with scientific trainings, linkages with provision of seed, seedling and eggs for silk worm production

- Training in Tailoring and Embroidery were offered to unemployed needy women of Sonapur and Lumshnong area in technical collaboration with M/s Usha International Ltd. for providing professional training.

- Development of backyard ponds to develop as fisheries under Fishery Project of Sonapur area as a source of food security and sustainable livelihood.

HEALTH AND SANITATION

Your Company as a good corporate citizen provided basic health care services in and around plant location.

- Periodic Health camps were organised to diagnose health problems and patients were supported with basic drugs for minor ailments needed for taking care of essential health needs of men, women and children. Company had taken up necessary measures to render eye care services in Assam and Meghalaya where free medicines, spectacles were distributed to the needy patients. Surgeries were carried out free of cost for proper eye care to the neighboring needy people in Assam and Meghalaya.

- Company has made drinking water supply system to the households of Chamata Pathar village

EDUCATION

Your Company had made necessary contribution in the area of education by extending the necessary support to the educational institutes in nearby plant areas of Assam and Meghalaya:

- Supporting one teacher School i.e. Ekal Vidyalaya for augmenting primary education for children of remote areas. The projects aims to reach the education to every doorstep of the country. The Company has contributed to the Gyan Sagar Foundation.

- Company had rendered necessary financial support for hiring teachers.

- Company had taken up students support program targeting to encourage the students to attend their classes on regular basis. Under Students Support Program students were supported with exercise books, dictionaries and pencil boxes etc.

- To promote quality education in and around plant operational area, your company has organised remedial classes for HSLC appearing students

- Company has initiated for developing a computer fitted Bus for ensuring computer literacy among students and youths during journey.

EMERGENCY RELIEF

Your Company has supported the flood affected people by providing foods, drinking water, medicines etc., in Assam, North Bengal as a part of flood relief programme.

Annual Report on CSR as required to be annexed in terms of requirement of Section 135 of Companies Act, 2013 and rules framed thereunder is annexed herewith and marked Annexure- 3.

EVALUATION OF THE BOARDâS PERFORMANCE

In accordance with the requirements of the Companies Act 2013, the performance evaluation of the Board was carried out during the year under review. The Board follows a formal mechanism for the evaluation of the performance of the Board as well as Committee. The evaluation reflected the overall engagement of the Board and the Committee.

The Nomination and Remuneration Committee at its meeting established the criteria based on which the Board evaluate the performance of the Directors.

The Directors expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Manindra Nath Banerjee resigned as Independent Director with effect from 6th September, 2017.

The Board places on record its appreciation for the services rendered by Mr. Banerjee during his tenure with the Company.

On the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on 13th November, 2017 appointed Mr. Pramod Kumar Shah (DIN: 00343256) as Additional Director in the Independent category with effect from 13th November, 2017 for a term of 3 years subject to regularization/approval of the shareholders in the ensuing Annual General Meeting.

Mr. Manoj Agarwal resigned as Company Secretary and Key Managerial Personnel with effect from 2nd August, 2017. The Board places on record its appreciation for the services rendered by Mr. Agarwal during his tenure as Company Secretary. On the recommendation of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on 3rd August, 2017 appointed Mr. Debabrata Thakurta as Company Secretary and Key Managerial Personnel of the Company.

Mr. Dilip Kumar Agarwal resigned as Chief Financial Officer and Key Managerial Personnel with effect from 13th November, 2017. The Board places on record its appreciation for the services rendered by Mr. Agarwal during his tenure with the Company. On the recommendation of the Audit Committee and Nomination and Remuneration Committee, the Board of Directors at its meeting held on 13th November, 2017 appointed Mr. Manoj Agarwal as Chief Financial Officer and Key Managerial Personnel of the Company.

The tenure of Mr. Sajjan Bhajanka, Mr. Rajendra Chamaria and Mr. Sanjay Agarwal, Managing Directors of the Company were due to expire on 31st March, 2018. The Board at its meeting held on 6th February, 2018, on the recommendations of Nomination and Remuneration Committee, re-appointed Mr. Sajjan Bhajanka, Mr. Rajendra Chamaria and Mr. Sanjay Agarwal as the Managing Directors of your Company for further period of three years with effect from 1st April, 2018 subject to necessary approvals of the shareholders at the ensuing Annual General Meeting.

In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Prem Kumar Bhajanka will retire by rotation and being eligible, offer himself for re-appointment. In view of his considerable experience, your Directors recommend his re-appointment as Director of the Company.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013. Mr. Mangilal Jain, Mr. Pramod Kumar Shah, Mr. Santanu Ray, Mrs. Ibaridor Katherine War and Mrs. Plistina Dkhar are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in section 149 of the Act and the Rules made thereunder about their status as Independent Director of the Company.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

In order to enable the Independent Directors to perform their duties optimally, the Board has devised a familiarization programme for the Independent Directors to familiarize them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. They are periodically updated about the development which takes place in the Company. At the time of appointment of an Independent Director, the Company issues a formal letter of appointment setting out in detail, the terms of appointment, duties, responsibilities and commitments etc. The familiarization program is available on the Companyâs website under the web link: http://starcement.co.in/wp-content/uploads/Familiarization-Programme.pdf

SUBSIDIARIES AND ASSOCIATE COMPANY

M/s. Star Cement Meghalaya Limited, M/s. Megha Technical & Engineers Private Limited, M/s. Meghalaya Power Limited, M/s. NE Hills Hydro Limited and Star Century Global Cement Private Limited continue to remain subsidiaries of the Company.

Star Cement Meghalaya Limited is engaged in manufacturing of Cement Clinker and has a Clinkerization plant with an installed capacity of 1.75 MTPA. During the year under review, the Company manufactured 15,41,945 MT of clinker as against 15,79,345 MT in FY 2016-17.

Megha Technical & Engineers Private Limited is engaged in the manufacture of cement. During the year under review, the Company produced 33,004 MT of Cement.

Meghalaya Power Limited is engaged in generation of Power. During the year under review the Company generated 1,901 KWH Lac units of power.

NE Hills Hydro Ltd., wholly owned subsidiary of your Company is currently not operational.

Star Century Global Cement Private Limited a wholly-owned subsidiary in Myanmar is yet to commence its operations.

AUDITED FINANCIAL STATEMENTS OF THE COMPANYâS SUBSIDIARIES

Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement for the year ended March 31, 2018 for each of the Companyâs subsidiaries viz. Star Cement Meghalaya Limited (SCML), Megha Technical & Engineers Private Limited (MTEPL), Meghalaya Power Limited (MPL), NE Hills Hydro Limited (NHHL) and Star Century Global Cement Private Limited (SCGCPL) are annexed in the Form AOC - 1 and marked as Annexure-4.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company have been prepared in accordance to the requirement of Indian Accounting Standards, as prescribed by the Institute of Chartered Accountants of India and has been included as a part of this Annual Report.

The detailed financial statements and audit reports of each of the subsidiaries of the Company are available for inspection at the Registered Office of the Company during office hours between 11 A.M. and 1 P.M. The Company will arrange to send the financial statements of the subsidiaries upon written request from a shareholder to the registered address of the said shareholder.

DEPOSITS

CHANGES IMPACTING GOING CONCERN STATUS AND COMPANYâS OPERATIONS

During the year under review, there have been no material orders passed by the Regulators/Courts impacting materially the going concern status or future operations of the Company.

There were no material changes and commitments affecting the financial position of the Company during the period under review.

CREDIT RATINGS

Your Company enjoys a sound reputation for its prudent financial management and its ability to meet financial obligations. ICRA Limited, has upgraded the Companyâs short term rating to [ICRA]A1 (pronounced ICRA A one plus) and reaffirmed the long term rating at [ICRA]A (pronounced ICRA A plus). The outlook on the long-term rating has been revised from âStableâ to âPositiveâ.

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations, if any, along with corrective actions thereon are presented to the Audit Committee of the Board.

INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design or operations were observed. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES

The disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 along with a statement containing particulars of employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith and marked Annexure-5 and forms part of this report.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

The Company values the integrity and dignity of its employees. The Company has put in place a âPolicy on Prevention of Sexual Harassmentâ as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (âSexual Harassment Actâ). We affirm that adequate access has been provided to any complainants who wish to register a complaint under the policy. No complaint was received during the year.

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements as stipulated under the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). A separate section on corporate governance, along with a certificate from the auditors confirming the compliance, is annexed and forms part of the Annual Report. This certificate will be forwarded to the Stock Exchanges along with the Annual Report of the Company.

CHIEF EXECUTIVE OFFICER (CEO) /CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI), the CEO/ CFO certification has been submitted to the Board and a copy thereof is contained in this Annual Report.

RISK MANAGEMENT

Risk management refers to the practice of identifying potential risks in advance, analyzing them and taking precautionary steps to reduce the risk. The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.

HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS

Ever since the inception, Star Cement has been a benchmark of unprecedented success over the past decade and the voyage has been momentous with glorious milestones and incredible feats. The company today is not only the market leader and the most preferred brand in North Eastern India, but is also the fastest growing company in Eastern India. Our dedicated Human Capital, best of its kind Practices and Innovative Processes are the cornerstones which have contributed in paving the path to the zenith of success, thus making Star Cement one of the most sought after places to work in the cement sector in Eastern India.

With an objective to develop a strong employer value proposition and enhance the brand awareness and reputation, hiring at leadership positions is being done from other leading Cement Companies .Campus recruitment from some of the Best B Schools of Eastern India including IIM Shillong, IIM Ranchi and IIM Bodh Gaya also plays an integral role to help in differentiating the employer brand.

It has been a constant endeavor of Human Resource Department of Star Cement to create a high performing organization. A structured and robust Performance Management System has helped in aligning the workforce, building competencies, improving employee performance and development, and driving better business results. It has also created a work environment that empowers employees to work to the best of their abilities. Over the years, people have grown and evolved with the organization and has been bestowed with the best of rewards, accolades, compensation and benefits, both fixed and variable.

Another area is the blue collared workforce management, especially the Local employees in our Plants, has witnessed transformational changes in their existing People Practices and gives a whole new dimension to employee life cycle management. Several interventions in the areas of Performance tracking and enhancement, Training, Performance Coaching for local employees and dedicated Counseling have led to a dynamic change in the culture of the organization and mindset of local employees, resulting in a marked improvement in the productivity and overall engagement levels.

During the year under review, there has not been any material changes in human resources and industrial relations.

GREEN INITIATIVES IN CORPORATE GOVERNANCE

Ministry of Corporate Affairs has permitted Companies to send copies of Annual report, Notices, etc., electronically to the email IDs of shareholders. Your Company has arranged to send the soft copies of these documents to the registered email IDs of the shareholders, wherever applicable. In case, any shareholder would like to receive physical copies of these documents, the same shall be forwarded upon receipt of written request in this respect.

CAUTIONARY STATEMENT

Statements in this report describing the Companyâs objectives, expectations or predictions, may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companyâs operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in Government policies and tax laws, economic development of the country and other factors which are material to the business operations of the Company.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their deep sense of gratitude to Banks, Central and State Governments and their departments and the local authorities, customers, vendors, business partners/associates for their continued guidance and support.

Your Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Company and dedicates the credit for the Companyâs achievements to them. Last but not least, your Directors express their gratitude to the shareholders of the Company for reposing their confidence and faith in the Management of the Company.

For and on behalf of the Board of Directors

Sajjan Bhajanka

Place: Kolkata Chairman

Date: 17 May, 2018 (DIN: 00246043)

Mar 31, 2017

Dear Shareholders,

The Directors have pleasure in presenting Sixteenth Annual Report of the Company together with the Audited Balance Sheet as at 31st March, 2017 and the Statement of Profit & Loss for the year ended on that date.

CHANGE OF NAME

Pursuant to shareholdersâ approval obtained at the Extra-ordinary General Meeting held on 24th May, 2016, the name of the Company was changed from âCement Manufacturing Company Limitedâ to âStar Cement Limitedâ with effect from 21st June, 2016.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the financial year ended 31st March, 2017 as compared to the previous financial year are as under:

(Rs. in Lacs)

Particulars	Consolidated		Standalone
Particulars	2016-17	2015-16	2016-17	2015-16
Net Sales / Income	173,019.21	171,633.40	140,226.60	141,692.78
Profit before Interest, Depreciation, Tax and extra ordinary items	41,097.11	40,069.11	18,196.51	16,618.59
Exceptional Items	1.00	(53.14)	35.36	(55.00)
Profit before Interest, Depreciation and Tax	41,098.11	40,015.97	18,231.87	16,563.59
Interest & Finance Charges	(7,797.36)	(8,336.76)	(5,631.68)	(4,913.04)
Depreciation	(14,120.54)	(17,149.21)	(4,669.26)	(6,064.49)
Profit/(Loss) before Tax	19,180.21	14,530.00	7,930.93	5,586.06
Provision for taxation:
- Current Tax	(4,175.35)	(3,231.89)	(1,706.63)	(1,195.58)
- Less: MAT credit entitlement	4,007.02	2,973.55	1,706.63	1,195.58
- Net Current Tax	(168.33)	(258.34)	-	-
- Income Tax for earlier years	(753.03)	(34.79)	393.87	(41.59)
- Deferred Tax	(505.69)	(302.49)	228.61	85.90
-Minority Interest	(589.82)	(530.59)	-	-
Net Profit after Tax (after minority)	17,163.34	13,403.79	7,308.45	5,630.36

SCHEME OF AMALGAMATION AND SHARE CAPITAL

The Honâble National Company Law Tribunal at Guwahati vide its order dated 7th February, 2017, approved amalgamation of erstwhile holding company M/s. Star Ferro and Cement Limited with your Company effective from 22nd February, 2017. The appointed date for amalgamation was 1st April, 2016.

Pursuant to merger of erstwhile Star Ferro and Cement Limited into the Company, the Authorized Share Capital of the Company has increased to Rs.83,00,00,000 divided into 83,00,00,000 Equity Shares of Rs.1/- each. In line with terms of Scheme of Amalgamation, 29,54,90,077 (Twenty Nine Crore Fifty Four Lakh Ninety Thousand Seventy Seven) equity shares of the Company were allotted on 8th April, 2017 to the shareholders of erstwhile Star Ferro and Cement Limited in the ratio of 1.33 equity shares of Rs.1 each of the Company for every 1 (one) equity share of Rs.1 each of erstwhile Star Ferro and Cement Limited held by them as on the record date i.e. 3rd April, 2017. After the said allotment the total number of equity shares of the Company has aggregated to 41,92,28,997 of Rs.1 each. Your Company has initiated steps to list its shares with National Stock Exchange of India Limited and BSE Limited.

During the year under review, the Company has neither issued any shares with differential voting rights nor granted stock options or sweat equity shares.

EXTRACT OF ANNUAL RETURN

In terms of requirement of section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual return in form MGT-9 is annexed herewith and marked Annexure-1.

MEETINGS OF THE BOARD

During the year eight (8) Board Meetings and six (6) Audit Committee Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. The details of the Board meeting and the Committee meeting are provided in the Corporate Governance Report.

MEETINGS OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent Directors was held on 18th March, 2017 wherein the performance of the Non-Independent Directors and the Board as a whole was reviewed. The Independent Directors at their meeting also inter alia assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.

COMMITTEES OF THE BOARD

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company has a Whistle Blower Policy/ Vigil Mechanism as required under Section 177 of the Companies Act, 2013 and as per Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). The Vigil (Whistle Blower) mechanism provides a channel to the employees and Directors to report to the management, concerns about unethical behavior, actual or suspected fraud or violation of the Code of Conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases. The said policy may be referred to at the Companyâs website at the web link: http://starcement.co.in/wp-content/uploads/Whistle-Blower-Policy.pdf

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT EMPLOYEES

The Board has framed a Remuneration Policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management Employees. The remuneration policy aims to enable the Company to attract, retain and motivate highly qualified members for the Board and at other executive levels. The remuneration policy seeks to enable the Company to provide a well-balanced and performance-related compensation package, taking into account shareholder interests, industry standards and relevant Indian corporate regulations. The details on the same are given in the Corporate Governance Report. The said policy may be referred to at the Companyâs website at the web link: http://starcement.co.in/wp-content/uploads/ Remuneration-policy.pdf

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

- In the preparation of Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures, if any;

- The Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2017 and of the profit of the Company for the year under review;

- The Directors have prepared the annual accounts on going concern basis;

- The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

- The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

AUDITORS & AUDITORSâ REPORT

M/s. Kailash B. Goel & Co., Chartered Accountants (Firm Registration no. 322460E), Statutory Auditors of the Company, have completed their tenure of two terms of five consecutive years and also an additional window period of 3 years as stipulated under section 139 of the Companies Act, 2013. Therefore, the terms of office of the existing Statutory Auditors will conclude from the close of the forthcoming Annual General Meeting of the Company.

The Board of Directors places on record its appreciation for the services rendered by M/s Kailash B. Goel & Co. as the Statutory Auditors of the Company.

M/s. D. K. Chhajer & Co., Chartered Accountants (Firm Registration no. 304138E) have expressed their willingness to be appointed as Statutory Auditors of the Company and have confirmed that their appointment, if made, would be within the limits mentioned under section 141(3)(g) of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014.

Subject to the approval of shareholders, the Audit Committee and the Board of Directors of the Company have recommended the appointment of M/s. D. K. Chhajer & CO., Chartered Accountants (Firm Registration no. 304138E), as Statutory Auditors of the Company pursuant to Section 139 of the Companies Act, 2013 for a period of five years commencing from the conclusion of 16th Annual General Meeting till the conclusion of 21st Annual General Meeting, subject to the ratification of their appointment by the members at every Annual General Meeting.

The Auditorsâ Report to the Shareholders for the year under review does not contain any qualification.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records maintained by the Company in respect of its manufacturing activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, appointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the financial year ended 31st March, 2017 in the Board Meeting held on 2nd May, 2016. The remuneration proposed to be paid to them for the financial year 2016-17, as recommended by audit committee, was ratified in the meeting of shareholders held on 22nd August, 2016.

M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) have expressed their willingness and confirmed their eligibility to be appointed as Cost Auditors of the Company for ensuing financial year. The Board, on recommendation of the Audit Committee, has appointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the financial year 2017-18 subject to ratification of their remuneration by shareholders in the General Meeting of the Company.

The cost audit report for the Financial Year 2015-16 was filed with the Ministry of Corporate Affairs on 21st September 2016.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. MKB & Associates, a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith and marked Annexure-2. The report is self-explanatory and do not call for any further comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, your Company has not given any loan to any person falling under ambit of Section 186 of the Companies Act, 2013.

RELATED PARTY TRANSACTIONS

All related party transactions are entered on armâs length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Accordingly, no transactions are being reported in Form AOC-2 in terms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014. However, the details of the transactions with the Related Party are provided in the Companyâs financial statements in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

RESERVES

During the year under review no amount was transferred to reserves.

DIVIDEND

In order to conserve resources for future operations, your Directors do not recommend any dividend for the Financial Year 2016-17.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

(A) Steps taken toward Conservation of energy:

- Change in mode of operation of Bag Filters from timer to differential pressure has resulted into reduction in consumption of compressed air.

- Installation of Grizzly in Raw Mill outlet has resulted into steady coal flow and reduction in flushing from FK pump, thereby reducing downtime of Kiln.

- Arrest of false air from pyro and mill circuit resulted into reduction in fuel and power consumption.

- Automation of plant lights and centralized control from CCR resulted into reduced power consumption in plant lighting.

(B) Steps taken toward Technical Absorption:

- Installation of Pre-Grinder unit with existing Ball Mill for Clinker Grinding has resulted into lower specific power consumption.

- Installation of new roto-packer at Guwahati Grinding Unit with Human Manual Interface (HMI) system has resulted into reduced human errors in packing operations.

- Installation of Ethernet based intelligent relays in place of device net based relays has made it possible to programme from remote.

- Installation of dry fly-ash cutting and feeding system to a newly constructed steel hopper has resulted into reduction in fly ash feeding circuit length.

- Installation of belt conveyors from truck tippler - 2 has resulted into reduction in material handling.

- Use of grinding aid has resulted into increase in grinding efficiency and better fly ash absorption.

- The Company has developed a Research & Development cell for carrying out R&D Projects in the plant with specific objective of development of advanced systems for quality improvement. During the year under review, your Company incurred Capital expenditure of Rs.2.20 Lacs and Revenue Expenditure of Rs.56.25 Lacs in Research & Development.

(C) Foreign Exchange Earnings And Outgo

During the period under review, Foreign Exchange Earning was Rs.79.99 Lacs (Previous Year Rs.15.50 Lacs and the Foreign Exchange Outgo was Rs.888.51 Lacs (Previous Year Rs.8,030.64 Lacs).

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES (CSR)

As a responsible corporate citizen, Companyâs CSR initiatives have been playing a significant role in bringing steady transformation of the society with special focus on marginalized and underprivileged section. Business decisions of the Company have always linked to the ethical values of âdo good for the communityâ and respect for people, communities and environment around the operational area and in nearby localities. Under the CSR purview, your Company along with its subsidiaries had prioritized need of the community under the following verticals:

Sustainable Livelihood

The Company has taken up livelihood enhancement projects through Agriculture Allied Sector intervention in Meghalaya and Assam. The component broadly includes following interventions for enhancement of secondary source of income:

- Bee keeping in Sonapur area as eco-friendly initiative with high employment potential;

- Pig rearing project was initiated in Lumshnong area to enhance income of farmers;

- Support to Eri Silk farmers with know-how, trainings, monitoring, linkages and providing seed, seedling and eggs for silk worm production;

- Providing Vocational training to build and upgrade skills of youth to better compete with the emerging needs of different sectors.

Promoting Preventive Healthcare and Sanitation

Your Company has provided effective healthcare solution to the rural people in and around the plant locations and nearby region as a whole through the following means:

- Contribution towards Swachh Bharat Abhiyan by constructing more than 100 toilets in Sonapur and Lumshnong area;

- The Company has organized series of awareness programs on Public Health Promotion and WASH Programs, family planning in Lumshnong and Sonapur;

- Providing medical aid to communities and other medical support;

- Providing safe drinking water into local areas.

Education

Your Company has contributed towards rural education infrastructure for ensuring quality education. Overall initiatives revolved around contributing towards effective learning. The major initiatives undertaken during the year are as follows:

- Supporting One Teacher School i.e. Ekal Vidyalaya for augmenting primary education for children of remote areas of Eastern India;

- Your Company continued providing support to Guwahati Blind School in managing their hygiene and sanitation facilities;

- Construction and maintenance of school buildings, providing learning materials for students and Induction of teachers & financial support for managing the schools.

Emergency Relief & Rural Development

Your Company participated actively in efforts by Dorbar Shnong of village Lumshnong in Meghalaya and other local institutions by addressing basic requirements of rural community at Lumshnong village. The major activities carried out during the year are as follows:

- Construction of bus stands, concrete steps, shops and outlets for enhancement of local livelihood and drainage facility within the village habitation;

- Development of playground for development of rural sports;

- Basic relief items to the people of Assam and Bihar in time of devastating flood.

Annual Report on CSR as required to be annexed in terms of requirement of Section 135 of Companies Act, 2013 and rules framed thereunder is annexed herewith and marked Annexure- 3.

EVALUATION OF THE BOARDâS PERFORMANCE

In accordance with the requirements of the Companies Act 2013, the performance evaluation of the Board was carried out during the year under review. The Board follows a formal mechanism for the evaluation of the performance of the Board as well as Committee. The evaluation reflected the overall engagement of the Board and the Committee.

The Nomination and Remuneration Committee at its meeting established the criteria based on which the Board evaluate the performance of the Directors.

The Directors expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. B. B. Agarwal and Mrs. Clara Suja resigned as Director with effect from 7th June, 2016 and 5th April, 2017 respectively. The Board places on record its appreciation for the services rendered by Mr. B. B. Agarwal and Mrs. Clara Suja during their tenure with the Company.

The Board of Directors at its meeting held on 8th April, 2017, appointed Mr. Santanu Ray (DIN: 00642736), Mrs. Ibaridor Katherine War (DIN: 03107920) and Mrs. Plistina Dkhar (DIN: 01375361) as Additional Directors in the Independent category with effect from 8th April, 2017 for a term of 5 years subject to regularization/approval of the shareholders in the ensuing Annual General Meeting.

In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Sanjay Agarwal will retire by rotation and being eligible, offer himself for re-appointment. In view of his considerable experience, your Directors recommend his re-appointment as Director of the Company.

The following personnel are Key Managerial person of the Company:

1. Mr. Sajjan Bhajanka : Managing Director

2. Mr. Rajendra Chamaria : Managing Director

3. Mr. Sanjay Agarwal : Managing Director

4. Mr. Sanjay Kumar Gupta : Chief Executive Officer

5. Mr. Dilip Kumar Agarwal : Chief Financial Officer

6. Mr. Manoj Agarwal : Company Secretary

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013. Mr. Mangilal Jain, Mr. Manindra Nath Banerjee, Mr. Santanu Ray, Mrs. Ibaridor Katherine War and Mrs. Plistina Dkhar are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in section 149 of the Act and the Rules made thereunder about their status as Independent Director of the Company.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

In order to enable the Independent Directors to perform their duties optimally, the Board has devised a familiarization programme for the Independent Directors to familiarize them with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, etc. They are periodically updated about the development which takes place in the Company. At the time of appointment of an Independent Director, the Company issues a formal letter of appointment setting out in detail, the terms of appointment, duties, responsibilities and commitments etc. The familiarization program is available on the Companyâs website under the web link: http://starcement.co.in/wp-content/uploads/Familiarization-Programme.pdf

SUBSIDIARIES AND ASSOCIATE COMPANY

M/s. Star Cement Meghalaya Limited, M/s. Megha Technical & Engineers Private Limited, M/s. Meghalaya Power Limited and M/s. NE Hills Hydro Limited continue to remain subsidiaries of the Company.

Star Cement Meghalaya Limited is engaged in manufacturing of Cement Clinker and has a Clinkerization plant with an installed capacity of 1.75 MTPA. During the year under review, the Company manufactured 15,79,345 MT of clinker as against 16,29,025 MT in FY 2015-16.

Megha Technical & Engineers Private Limited is engaged in the manufacture of cement. During the year under review, the Company produced 3,17,161 MT of Cement.

Meghalaya Power Limited is engaged in generation of Power. During the year under review the Company generated 2,016.24 Lac units of power.

NE Hills Hydro Ltd., wholly owned subsidiary of your Company is currently not operational.

During the year, the Company incorporated a wholly-owned subsidiary Star Century Global Cement Private Limited in Myanmar on 28th June, 2016 and the Company is yet to commence its operations.

AUDITED FINANCIAL STATEMENTS OF THE COMPANYâS SUBSIDIARIES

Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement for the year ended March 31, 2017 for each of the Companyâs subsidiaries viz. Star Cement Meghalaya Limited (SCML), Megha Technical & Engineers Private Limited (MTEPL), Meghalaya Power Limited (MPL), NE Hills Hydro Limited (NHHL) and Star Century Global Cement Private Limited (SCGCPL) are annexed in the Form AOC - 1 and marked as Annexure-4.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company have been prepared as per Accounting Standards- AS 21, as prescribed by the Institute of Chartered Accountants of India and has been included as a part of this Annual Report.

The detailed financial statements and audit reports of each of the subsidiaries of the Company are available for inspection at the Registered Office of the Company during office hours between 11 A.M. and 1 P.M. The Company will arrange to send the financial statements of the subsidiaries upon written request from a shareholder to the registered address of the said shareholder.

DEPOSITS

CHANGES IMPACTING GOING CONCERN STATUS AND COMPANYâS OPERATIONS

During the year under review, there have been no material orders passed by the Regulators/Courts impacting materially the going concern status or future operations of the Company.

There were no material changes and commitments affecting the financial position of the Company during the period under review.

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design or operations were observed. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES

The disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 along with a statement containing particulars of employees as required under Section 197 of Companies Act, 2013 read with Rule 5 (2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith and marked Annexure- 5 and forms part of this report.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

CORPORATE GOVERNANCE

The Company has complied with the corporate governance requirements as stipulated under the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI). A separate section on corporate governance, along with a certificate from the auditors confirming the compliance, is annexed and forms part of the Annual Report. This certificate will be forwarded to the Stock Exchanges along with the Annual Report of the Company.

CHIEF EXECUTIVE OFFICER (CEO) /CHIEF FINANCIAL OFFICER (CFO) CERTIFICATION

As required under Regulation 17(8) of the Listing Obligations and Disclosures Requirements Regulations, 2015 formulated by Securities and Exchange Board of India (SEBI), the CEO/ CFO certification has been submitted to the Board and a copy thereof is contained in this Annual Report.

RISK MANAGEMENT

Risk management refers to the practice of identifying potential risks in advance, analyzing them and taking precautionary steps to reduce the risk. The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.

HUMAN RESOURCE DEVELOPMENT & INDUSTRIAL RELATIONS

Star Cementâs journey over the past decade has been a momentous one, fringed with success stories and glorious feats. The Company has not only established itself as the market leader and most preferred brand in North Eastern India, but is also steadily propelling forward as the fastest growing company in Eastern India.

Star Cement owes its burgeoning Success Story to its highly talented pool of human assets who have strived incessantly to redefine the standard of excellence through unparalleled hard-work and unmatched determination. Living true to its Mission Statement, Star Cement respects the dignity of its employees and aspires to be respected for the highest level of integrity and human values in the corporate arena of Eastern India. Over the years, people have grown and evolved with the organization and has been bestowed with the best of rewards, accolades, compensation and benefits.

Besides getting an opportunity to work in an extremely stimulating environment and enriching functional domains, Star employees are proud to belong to an organization which offers them a galore of opportunities - in terms of enhancing their learning curve, continuous upgradation of their skill-sets, professional development as per identified training needs, cross-functional career options, leadership training programs, competency assessment and robust succession plan.

Star Cement promotes a fair and transparent work culture and believes in providing equal opportunities to all its employees. While hiring candidates, race, colour, religion, national origin, citizenship, geographical positioning, age, gender, marital status, ancestry, social standing, physical or mental disability, medical condition, socio-economic background or sexual orientation are not taken into consideration. The organization provides a conducive environment for its people to thrive in harmony and deliver collectively towards achieving the organizational goal.

AWARDS AND ACCOLADES

Your Directors are pleased to report that during the year under review, your Company was awarded National runner up -Driving Positive Change in Mahindra Transport Excellence Awards, 2016 under Construction and mining segment at a ceremony held at New Delhi.

GREEN INITIATIVES IN CORPORATE GOVERNANCE

Ministry of Corporate Affairs has permitted Companies to send copies of Annual report, Notices, etc., electronically to the email IDs of shareholders. Your Company has arranged to send the soft copies of these documents to the registered email IDs of the shareholders, wherever applicable. In case, any shareholder would like to receive physical copies of these documents, the same shall be forwarded upon receipt of written request in this respect.

CAUTIONARY STATEMENT

Statements in this report describing the Companyâs objectives, expectations or predictions, may be forward looking within the meaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companyâs operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in Government policies and tax laws, economic development of the country and other factors which are material to the business operations of the Company.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their deep sense of gratitude to Banks, Central and State Governments and their departments and the local authorities, customers, vendors, business partners/associates for their continued guidance and support.

Your Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Company and dedicates the credit for the Companyâs achievements to them. Last but not least, your Directors express their gratitude to the shareholders of the Company for reposing their confidence and faith in the Management of the Company.

For and on behalf of the Board of Directors

Place: Kolkata Sajjan Bhajanka

Date: 30th May, 2017 Chairman

(DIN: 00246043)

Mar 31, 2016

Dear Shareholders,

The Directors have pleasure in presenting Fifteenth Annual Report of the Company together with the Audited Balance Sheet as at 31st March, 2016 and the Statement of Profit & Loss for the year ended on that date.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the Financial Year ended 31st March, 2016 as compared to the previous financial year are as under:

(Rs, In Lacs)

Particulars	Consolidated		Standalone
	2015-16	2014-15	2015-16	2014-15
Net Sales / Income	171,633.40	143,120.91	141,692.78	111,408.52
Profit before Interest, Depreciation, Tax and extra ordinary items	40,069.11	43,723.31	16,618.59	17,599.61
Exceptional Items	(53.14)	1.83	(55.00)	(1.31)
Profit before Interest, Depreciation and Tax	40,015.97	43,725.14	16,563.59	17,598.30
Interest & Finance Charges	(8,336.76)	(8,738.44)	(4,913.04)	(4,452.40)
Depreciation	(17,149.21)	(22,374.29)	(6,064.49)	(8,645.70)
Profit/(Loss) before Tax	14,530.00	12,612.41	5,586.06	4,500.19
Provision for taxation:
- Current Tax	(3,231.89)	(2,640.09)	(1,195.58)	(953.27)
- Less: MAT credit entitlement	2,973.55	2,640.09	1,195.58	953.27
- Net Current Tax	(258.34)	-1	-	-
- Income Tax for earlier years	(34.79)	16.52	(41.59)	-
- Deferred Ta x	(302.49)	(496.65)	85.90	102.44
- Minority Interest	(530.59)	(266.88)	-	-
Net Profit after Tax (after minority)	13,403.79	11,865.39	5,630.36	4,602.63
Add: Balance as per the last financial statement	60,284.57	52,443.43	36,836.29	36,257.92
Profit available for appropriation	73,688.36	64,308.82	42,466.65	40,860.54
Appropriations:
Proposed Dividend on Equity Shares	-	(3,353.71)	-	(3,353.71)
Corporate Dividend Tax	-	(670.55)	-	(670.55)
Total	-	(4,024.26)	-	(4,024.26)
Balance carried forward to Balance Sheet	73,688.36	60,284.57	42,466.65	36,836.29

OPERATIONAL PERFORMANCE

Operational Performance of manufacturing units of your Company and its subsidiaries recorded growth over previous year. During the year under review clinker production of Lumshnong unit of the Company was at 492,055 MT as against 330,010 MT during FY 2014-15. Similarly, Companyâs subsidiary M/s. Star Cement Meghalaya Limited produced 1,629,025 MT of Clinker as against 1,549,349 MT during the FY 2014-15. On consolidated basis total clinker production during the year was at 2,121,080 MT as against 1,879,359 MT during FY 2014-15 recording a growth of 12.9%. In terms of capacity utilization, clinkerization unit of your Company was able to utilize 62.1% of its installed capacity as against 41.7% during the FY 2014-15. Similarly, the capacity utilization of clinkerization unit of its subsidiary M/s. Star Cement Meghalaya Limited was at 93.1% during FY 2015-16 as against 88.5% during the FY 2015-16. On consolidated basis, the capacity utilization of clinkerization units was at 83.4% during the FY 2015-16 as against 73.9% during FY 2014-15.

On the grinding front too, operations of grinding units have registered growth over previous year. During the year under review, total cement production on consolidated basis was at 2,670,287 MT (including hired grinding units) as against 2,171,666 MT during the FY 2014-15, recording a growth of 23%.

On sales side too your Company has been able to record growth in volume sold during the year under review. During the

FY 2015-16, you Company has been able to achieve sales volume of 2,629,695 MT of Cement as against 2,169,251 MT during the previous Financial Year, thus recording a growth of 21.2% over previous year.

With improvement in outlook of economy, your Company expects to improve its operational performance during the ensuing financial year.

ECONOMIC SCENARIO AND OUTLOOK

India as an economy fared well during the Financial Year 201516 as compared to most of the developing economies as also compared to developed economies. The signs of consolidation of Indian Economy which started reflecting during October-December Quarter of FY 2014-15 were sustained and confirmed during the year under review. During the quarter ended December 2014, the annual growth rate of Gross Domestic Product (GDP) was seen to improve at 7.5% as against 6.4% in the same quarter of 2013. As against 7.2% of GDP growth during Financial Year 2014-15, Indian Economy is expected to register GDP Growth rate of 7.6% during the FY 2015-16.Despite a weak monsoon for a second consecutive year, agriculture grew by 1.1% during the year under review. Food grain production is estimated to have increased by 0.5% in FY 2015-16, though there was lower production of rice, coarse cereals, oilseeds, and sugarcane. Improvement in private consumption was witnessed largely on account of a pickup in urban consumption, while rural consumption remained subdued as a result of two consecutive weak monsoons. Government consumption growth also stayed tepid as the Central Government boosted capital expenditure and curtailed current expenditure. Increase in capital expenditure undertaken by the Central Government helped investment growth to improve further during the year under review as compared to previous Financial Year.

Inflationary pressures were largely under control mainly on account of sharp fall witnessed in the prices of oil as also on account of base rate effect and softening of food prices. Wholesale Price Index (WPI) remained in negative territory during large part of the year under review whereas the retail inflation measured by Consumer Price Index (CPI) eased to a record low of 3.66% in August 2015. As against 2% of inflation witnessed in Wholesale Price Index (WPI) during the FY 2014-15, the year under review is likely to close in negative territory. Similarly, inflation rate measured in form of Consumer Price Index was at 5.18% as of February, 2016 against 6.4% during FY 2014-15.

Growth is expected to pick up during the ensuing Financial Year, helped by the Governmentâs strengthening of public sector banksâ capital and operations, private investment benefitting from corporate deleveraging, the financing of stalled projects and an uptick in bank credit.

As against this, Global economic growth slowed in FY 2015-16 to its weakest pace since the year 2008-09. This was mainly led by slower growth in emerging economies. Chinaâs real GDP growth was witnessed at 6.9% during the year 2015 which is one of the slowest in last 25 years reflecting a weaker growth in countryâs industrial sector. Growth in other emerging economies also slowed in 2015 and more particularly in commodity producing countries. All major developed economies are expected to see the growth momentum picking up. Despite expectations of a more robust recovery, developed economies continue to face considerable headwinds from the legacies of the global financial crisis, including subdued employment levels, elevated private and public sector debt, and financial sector fragilities.

CEMENT SCENARIO IN INDIA

India is one of the largest producer of Cement in world and only second to China. It accounts for nearly 8% of the total global production having close to 400 Million MT per annum installed capacity. The cement industry capacity doubled in the last decade, with about 70 Million MT added in the last three years alone. Cement, being a bulk commodity, is a freight intensive industry and transporting it over long distances can prove to be uneconomical. This has resulted in cement being largely a regional play with the industry divided into five main regions viz. North, South, West, East and the Central region. The Southern region of India has the highest installed capacity, accounting for about one-third of the countryâs total installed cement capacity.

On the consumption side, India has witnessed sustained growth in cement consumption since 2001. However, consumption growth has slowed down in last 4-5 years mainly on account of a slump in housing, infrastructure and commercial sector. The gap in the pace between capacity additions and actual demand has led to an excess capacity situation in the industry, resulting in sub-optimal utilization rates.

On Per Capita consumption front, cement in India still remains substantially low at about 195 kg which is less than 50% as compared with the world average and thus underlines the tremendous scope for growth in the Indian cement industry in the long term.

Cement is a cyclical commodity with a high correlation with GDP The housing sector is the biggest demand driver of cement, accounting for about two-thirds of the total consumption. The other major consumers of cement include infrastructure, commercial construction and industrial construction.

First half of FY 2015-16 witnessed slowdown in consumption and demand growth. However, second half of the Financial Year started with up-tick in demand which further consolidated during the last quarter of the financial year. Housing sector is the major demand driver. The slow growth in cement sector is expected to remain a short-term phenomenon with the Governmentâs focus on constructing 50 million houses under âHousing for Allâ scheme by 2022. Governmentâs other initiatives such as 100 smart cities, AMRUT cities, affordable housing as well as initiatives undertaken towards development of ports, roads, bridges, freight corridor, etc. are likely to provide further impetus to cement demand in India. This also gets reflected with Governmentâs intention to unshackle the impediments in economic and infrastructural growth. The years ahead are expected to bring more cheers for Indian Cement Industry.

On the cost front power, fuel and logistic costs are the major cost drivers. Cost, quality and availability of coal are major cost driver for power as well as fuel so far as cement industry is concerned. Indian cement industry continued to face challenges on this front, both in terms of quality as well as prices. However, with all time low Baltic Dry Index (BDI), the landed cost of imported Petroleum Coke has been seen to be more cost effective for cement industry in terms of its cost as well as consistency in quality parameters. With unblocking of coal blocks and Governments intent to bring perceptible difference in power supply situation, both in terms of quantity and quality, it is expected that in years to come, the challenges currently being faced by Indian cement industry will be eased out.

SEVEN SISTERS AND EASTERN INDIA - A LAND OF OPPORTUNITIES FOR INDIAN CEMENT INDUSTRY

North Eastern India comprises of contiguous Seven Sister States namely Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, and Tripura and the Himalayan state of Sikkim and located in eastern most part of country.

Indiaâs North East Region (NER) is endowed with huge untapped natural resources. However, despite being endowed with vast natural resources in terms of forests, biological diversity, hydroelectricity, the region has remained largely underdeveloped on account of poor infrastructure and limited connectivity, both within the region as well as with the rest of the country. The region, connected to the rest of India by a narrow stretch of land called the âchickenâs neckâ, needs infrastructure to support. Large Hydro potential that exists in NER and if exploited, has potential to export power to the power deficit northern and western regions of the country. This under development of the region presents a lot of opportunities for industrial and infrastructure growth within the region. Development of infrastructure such as roads, communications, and electricity supply to remote hilly area will result in better quality of life. The improvement in power generation will in turn help in establishing industries by annulling the effects of high transportation costs. Owing to proximity of the region with neighboring countries such as Bangladesh and Myanmar, the region has potential of augmenting trade.

On the socio-economic front, the region stands way below in comparison with the rest of India. Underdeveloped infrastructure has been one of major bottlenecks in development of region on socio-economic front. During recent years the Government has taken several steps to overcome these infrastructural bottlenecks to induce sustainable development in the region. The strong focus on roads, airports and hydropower developments are some of the key steps in this direction.

Realizing these opportunities your Company had started setting up its first cement plant in the State of Meghalaya of NER with a very small capacity of 0.3 Million MT more than a decade ago and started its commercial operations during later part of the FY 2004-05. The product and brand was well accepted in the markets of North East. Looking at the potential of the market, your Company kept on adding the capacity which has reached to the level of 2.60 Million MT per annum of Cement Clinker and around 3 Million MT of Cement in North East alone. With passage of time, your Company has been able to spread its foot print in the entire North Eastern Region in terms of its distribution network and enjoys a premium brand reputation commanding highest market share in North Eastern Region. Owing to the vast opportunities, markets of North Eastern Region continued to remain the focus market for your Company.

During the year under review the region witnessed infrastructure growth story getting realized on the ground with two major highway projects dedicated to NER on 1st May, 2015. Shillong Bye-pass Highway Project and four-lane Jorabat - Barapani section of NH-40 was opened for public on its completion. This has helped decongest the traffic in the city of Shillong from trucks and heavy vehicles coming from or moving towards North Eastern parts of Assam, Mizoram and Tripura apart from significant reduction in travel time and also ease of logistic operations for cement industry like your Company having factory in Meghalaya. Much awaited broad gauge conversion work of Silchar-Lumding railway line on a stretch of 210 Kms was completed and opened for Goods and Passenger Traffic during the year under review. Similarly, the capital town of the landlocked State of Tripura appeared on a broad-gauge railway network connecting Tripura with the rest of the country. The project consists of 79 major bridges, 340 minor bridges and 21 tunnels. The rail line brings Assamâs underdeveloped but strategically important Barak Valley as well as State of Tripura on the broad gauge map. During the year under review, the State of Arunachal Pradesh was presented with second Broad Gauge connectivity with the commissioning of Balipara - Bhalukpong gauge conversion. Similarly, North Lakhimpur - Murkongselek and Balipara - Bhalukpong sections into broad-gauge. Commissioning of newly converted North Lakhimpur - Murkongselek section marked the completion of Rangiya - Murkongselek Gauge Conversion project running all along the North Bank of Brahmaputra. There are other major railway projects which are on a fast track of completion.

All the above developments present a promising future for cement industry in North East Region.

Simultaneous with expanding its horizon in the markets of North Eastern Region, your Company which started its network expand in the markets of West Bengal and Bihar during the latter part of Financial Year 2013-14 has further consolidated its presence in these markets during the year under review. States of West Bengal and Bihar have also remained under developed as compared to rest of India and has tremendous growth opportunities in infrastructure and housing sector, two major demand drivers of cement. During the year under review your Company has successfully driven the marketing campaign in these States to bring the recall of its brand âSTAR CEMENTâ at the top of peopleâs mind. Looking at opportunities in these markets, your Company has further augmented its capacity in form of arrangements with grinding units in the State of West Bengal.

MARKET DEVELOPMENT

Despite slowdown in cement demand in rest of the country, growth in cement demand in North East was close to countryâs

GDP growth rate. During the year under review, cement demand in NER has grown by more than 7% over previous Financial Year. Over a period of time, cement import to NER from outside region has also reduced considerably. During the year under review less than 15% of cement was imported in the region from outside as against more than 17% during previous Financial Year. During the year under review your Company was able to sale 1,703,415 MT of cement in the markets of NER as against 1,498,380 MT during the FY 2014-15 and thus recording a growth of 13.7% over previous year.

Your Directors are pleased to report that markets of West Bengal and Bihar where brand âStar Cementâ is relatively a new player as compared to its positioning in the markets of North Eastern Region, has fared well during the year under review. Your Company has been able to sale 926,280 MT of cement during the Financial Year 2015-16 in these markets as against 670,871 MT during the Financial Year 2014-15 registering a growth of 38% over previous year. To augment its capacity further in these markets, your company has made arrangements with one more grinding unit in the State of West Bengal during the year under review. With this arrangement, your Company has grinding arrangement of close to 1 Million MT of cement per annum. The capacity augmentation will help further in cutting down the logistic time to make the product available in these markets.

In line with Companyâs endeavor to focus trade segment of the business, your Company continued adding dealer and retail network across length and breadth of the North East Region as well as in the States of West Bengal and Bihar to make its foot prints more visible in these markets. At the close of the fiscal, your Company had dealer and retail network of more than 6000 spread across entire North East Region and 4000 in the States of West Bengal and Bihar.

During the year under review your Company has undertaken various marketing initiatives in order to make the brand âSTAR CEMENTâ more visible and attain top of mind recall. In the markets of North Bengal and Bihar, your Company launched its premium product âStar Anti-Rust Cementâ. Marketing Campaign called âKismat Ki Boriâ was launched in various markets of North Eastern Regions and outside the region too. During the year under review your Companyâs branding initiative in form of âLargest Idol of Goddess Durgaâ was a huge success story. To make the brand more visible in remote areas, a block level branding campaign was undertaken. In addition, your Company has conducted various knowledge sharing events mainly related to construction techniques in form of âEngineersâ Workshopâ and âStar Techâ to impart training to engineers. Your Company has also conducted more than 50 âMason Certification Programmeâ wherein masons were trained and their construction skills were certified jointly by your Company and local engineering institutes. These initiatives has helped your Company to promote the brand âSTAR CEMENTâ in a more effective manner in these markets and has also resulted into creation of better informed category of masons and engineers.

PRODUCTION AND COST DEVELOPMENTS

During the year under review, your Company has been able to leverage on the fixed cost on account of better volumes of production and sales and better capacity utilization.

FLY ASH

Your Company continued to promote environment friendly blended cement using fly ash and produced 1,873,424 MT of Portland Pozzolana Cement (PPC) (including from hired grinding units) on consolidated basis out of total production of 2,670,287 MT of cement during FY 2015-16. Usage of fly ash in cement is not friendly to environment only but also provides cost optimization. Your Company has been able to utilize the fly ash generated by power plant of its subsidiary M/s. Meghalaya Power Limited and such close access to fly ash provides competitive edge to your Company in term of cost. In addition, your Company has also made arrangements with major power plants like NTPC, Tata Power and few others to ensure its long term requirement of fly ash.

POWER COST

LOGISTICS & FREIGHT

During the year under review, Companyâs initiative of re-aligning its distribution network by servicing long lead consumption markets through new grinding arrangements in West Bengal has resulted into reduction of weighted average lead distance which has further optimized freight cost while ensuring reduction in execution lead time.

Major thrust given on Railway transportation has resulted into better Rail co-efficient. Opening of new broad gauge connectivity in goods traffic in North Eastern Region during the year under review is expected to further optimize the Rail Road Mix of total load being transported. Effective utilization of Railway Sidings, containerized movement of cement to long lead destinations, augmentation in warehousing and transporters network were other major initiatives undertaken during the year under review.

Few of the major highlights of the performance are:

KEY PERFORMANCE HIGHLIGHTS

- Consolidated cement production was 2,670,287 MT during the year as against 2,171,666 MT during the previous financial year, registering a growth of 23%.

- Consolidated net sales wereRs,171,502.94 Lacs during the year under review as compared toRs,143,042.78 Lacs during the financial year 2014-15, registering a growth of 19.8 %.

- Consolidated EBIDTA was atRs,40,069.11 Lacs as compared toRs,43,723.31 Lacs during the immediate previous Financial Year.

- Consolidated profit before tax during the year 2015-16 was atRs,14,530.00 Lacs as against a profit ofRs,12,612.41 Lacs in the year 2014-15.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2016 was atRs,4,192.14 Lacs. During the year under review, each equity share ofRs,10/- was sub-divided into ten equity shares ofRs,1/each as per approval of shareholders in the meeting held on 28th March, 2016. During the year under review, the Company has not issued any shares with differential voting rights nor granted stock options or sweat equity shares.

EXTRACT OF ANNUAL RETURN

In terms of requirement of Section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual return in form MGT-9 is annexed herewith and marked Annexure-1.

MEETINGS OF THE BOARD

During the year six (6) Board Meetings were convened and held on 28^th April, 2015; 7^th May, 2015; 22^nd July, 2015; 24^th September, 2015; 2^nd November, 2015 and 8^th February, 2016. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

The composition of the Board and the attendance details of the members of the Board are given below:

Name of the Director	Category		No. of Meetings
		Held	Attended
Mr. Sajjan Bhajanka	Managing Director	6	6
Mr. Sanjay Agarwal	Managing Director	6	4
Mr. Rajendra Chamaria	Managing Director	6	2
Mr. B.B. Agarwal	Non-Executive Director	6	2
Mr. Prem Kumar Bhajanka	Non-Executive Director	6	4
Mr. Pankaj Kejriwal	Non-Executive Director	6	2
Mrs. Clara Suja	Non-Executive Director	6	1
Mr. Mangilal Jain	Independent Director	6	6
Mr. Manindra Nath Banerjee	Independent Director	6	5

MEETINGS OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent Directors was held on 21st March, 2016 wherein the performance of the Non-Independent Directors and the Board as a whole was reviewed. The Independent Directors at their meeting also inter alia assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

- In the preparation of Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures, if any;

- The Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2016 and of the profit of the Company for the year under review;

- The Directors have prepared the annual accounts ongoing concern basis;

- The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013. Mr. Manindra Nath Banerjee and Mr. Mangilal Jain are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in Section 149 of the Companies Act, 2013 and the Rules made there under about their status as Independent Director of the Company.

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS

The remuneration policy seeks to enable the Company to provide a well-balanced and performance-related compensation package, taking into account shareholder interests, industry standards and relevant Indian corporate regulations.

AUDITORS & AUDITORSâ REPORT

M/s. Kailash B. Goel & Co., Chartered Accountants (Firm Registration No. 322460E), Statutory Auditors of the Company, have been appointed by the members at the previous Annual General Meeting and shall hold office for a period of 2 years from the date of such meeting held on 26th May, 2015. The Board, in terms of Section 139 of the Companies Act, 2013 on recommendation of the Audit Committee, has recommended for the ratification of the appointment of Statutory Auditors from the conclusion of the ensuing AGM till the conclusion of the Sixteenth Annual General Meeting.

Members are requested to approve and ratify their appointment. Members are also requested to empower the Board for fixation of Auditorsâ Remuneration. The Auditorsâ Report to the Shareholders for the year under review does not contain any qualification.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules,

2014, the cost audit records maintained by the Company in respect of its manufacturing activity is required to be audited. Your Directors have, on the recommendation of the Audit Committee, appointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration Number 000064) as Cost Auditors of the Company for the Financial Year ended 31st March, 2016 in the Board Meeting held on 28th April, 2015. The remuneration proposed to be paid to them for the Financial Year 2015-16, as recommended by audit committee, was ratified in the meeting of shareholders held on 26th May, 2015.

M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration Number 000064) have expressed their willingness to be appointed as Cost Auditors of the Company for ensuing financial year. The Board, on recommendation of the Audit Committee has appointed M/s. B. G. Chowdhury & Co., Cost Accountants, (Firm Registration number 000064) as Cost Auditors of the Company for the Financial Year 2016-17 subject to ratification of their remuneration by shareholders in the General Meeting of the Company.

The cost audit report for the Financial Year 2014-15 was filed with the Ministry of Corporate Affairs on 26th September, 2015.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act,

2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Manoj Kumar Banthia, Practicing Company Secretary, of M/s. MKB & Associates, a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith and marked Annexure-2. The report is self-explanatory and do not call for any further comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, your Company has not given any loan to any person falling under ambit of Section 186 of the Companies Act, 2013.

Details of Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

RELATED PARTY TRANSACTIONS

All related party transactions are entered on armâs length basis, in the ordinary course of business and are in compliance with the applicable provisions of the Companies Act, 2013. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Accordingly, no transactions are being reported in Form AOC-2 in terms of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014. However, the details of the transactions with the Related Party are provided in the Companyâs financial statements in accordance with the Accounting Standards.

All Related Party Transactions are presented to the Audit Committee and the Board. Omnibus approval is obtained for the transactions which are foreseen and repetitive in nature. A statement of all related party transactions is presented before the Audit Committee on a quarterly basis, specifying the nature, value and terms and conditions of the transactions.

RESERVES

During the year under review no amount was transferred to reserves.

DIVIDEND

In order to conserve resources for future operations, your Directors do not recommend any dividend for the Financial Year 2015-16.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated in Section 134 (3) (m) of the Companies Act, 2013 and rules framed there under is mentioned below:

(A) Steps taken toward Conservation of energy:

- Replacement of worn out plates in coal mill main bag filter to arrest false air;

- Replacement of Damaged dip tubes in cyclone has increased the efficiency of cyclone;

- Installation of VFD in primary crusher bag filter fan, tertiary crusher bag filter fan, New CSP compressor, new CSP top bag filter fan;

- Additional Capacitor Banks were added in HT motor circuit which resulted into improvement in power factor;

- LT Motors were optimized into Star-Delta connection resulting into reduction in power consumption;

- Higher Capacity Compressors were replaced with lower capacity to optimize the usage and power consumption;

- Replacement of higher capacity motor with lower capacity motors for cooler hydraulic drive and root blower ;

- Leakages were arrested in compressor airline;

- Replacement of conventional lights with LED bulbs.

(B) Steps taken toward Technical Absorption:

- Installation of vibrating screen before additive crusher has resulted into reduction into crusher jamming;

- Usage of Anti-Coating Bricks in Kiln has resulted into reduction in coating in Kiln;

- Installation of Dry Fly Ash Feeding System into classifier of Vertical Roller Mill instead of feeding fly ash at table of the mill has resulted into increase in efficiency of the Mill;

- Installation of new roto-packer with Human Manual Interface (HMI) system has resulted into less human errors in packing operations;

- The Company has developed a Research & Development cell for carrying out R&D Projects in the plant with specific objective of development of advanced systems for quality improvement. During the year under review, your Company incurred Capital expenditure ofRs,18.25 Lacs and Revenue Expenditure ofRs,53.05 Lacs in Research & Development.

During the period under review, Foreign Exchange Earning wasRs,15.50 Lacs and the Foreign Exchange Outgo was Rs,8,030.64 Lacs.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES (CSR)

Your Company as a responsible corporate citizen has created a separate CSR vertical within the Organization to focus upon CSR activities with the objective to create a more sustainable business model with participation of all stakeholders including community at large and has also aligned its practices in accordance with Schedule VII of the Companies Act, 2013.

CSR strategy of your Company has been designed which establishes strategic relationship with the State and Society in order to understand specific requirement of communities, to evaluate the same and to address the requirement for overall benefit of the society and community at large.

Your Company believes that human health condition and development of human resource is interrelated. Preventive and curative health care is the prime requirement of the pubic residing in Lumshnong Village area. During the year under review, your Company has contributed towards providing necessary health care services to the neighboring community. Special attention was given in the areas of ortho-care, gynecological treatment and pediatric care. Keeping in view lack of modern medical facilities in village area of Lumshnong, measures were taken to bring health care within the reach of villagers of Lumshnong Village. During the year under review your Company organized multi-specialty and theme based health camps from time to time for treatment in and around Lumshnong village in the State of Meghalaya and Sonapur in Assam for well-being of people residing in these villages. In the peripheral areas of plant locations, i.e. Lumshnong and Chamata Pathar, general health care clinics are being operated to provide preventive and curative health care services to the neighboring villagers round the year. Additionally, in line with the National Agenda of Swachh Bharat Abhiyan, your Company had contributed for creating awareness on health and hygiene by constructing low cost toilets in Chamata Pathar Village of Sonapur area.

Your Company believes that Education is the strongest and the most effective tool to bring substantial social change. Education allows every child to acquire the knowledge, skills, attitudes and values necessary to shape a sustainable future for himself as well as for society. Moreover, Education for Sustainable Development incorporates key environmental challenges like climate change into core subjects. Students are thus able to relate what they learn in the classroom to their real life actions and will increasingly be in a better position to take the lead in changing behaviors and adopting sustainable lifestyles. Keeping these objectives into mind, your Company imparts education in most modern newly built class-rooms to the under-privileged children of the nearby villages with complete free-ship. Lumshnong and Guwahati Grinding Unit being located in remote areas, your Company had contributed to foster educational environment by creating educational infrastructure, induction of tutorial classes , improvement of class rooms infrastructure etc. During the year under review, your Company offered Financial Aids and grants to few schools. Around 2000 students across 8 villages were touched by improving the quality and environment of educational institutes and their premises. Tutorial Classes and sessions were organized in Sonapur area to support students appearing State Board Examination, Assam-2016.

To support the challenges faced by differently-abled children, your Company offered its helping hand in form of meaningful financial aid to Guwahati Blind School, Assam and to encourage the effort of the school has also participated in felicitation of school students. Understanding the need of support during the hours it is actually required by people and offering helping hand during those testing times is always meaningful. During the year under review, your Company extended its support to community suffering from flood by organizing flood relief camps and distributing essentials in various districts of Assam. Similarly, in the State of Nagaland, your Company extended its help to families affected by fire.

In the area of development of rural infrastructure, during the Financial Year 2015-16, your Company, in consultation with Durbar Shnong in Meghalaya and Development Committee in Sonapur, Assam, initiated work in 7 villages. These rural infrastructure initiatives are targeted for development and construction of roads, bridges, drainage facilities, community halls, Elaka Hall, Linking bridge and roads leading to schools and villages, play-ground, water storage facility, water distribution system and rural electrification & maintenance for overall welfare of local populace. Efforts were initiated to make villages self-sufficient and self-reliant in their requirements.

Efforts were made to provide primary education through One Teacher School i.e. Ekal Vidyalaya in the vicinity of plants and many other areas through the Implementing Agency. Your Company also contributed in Yoga for General Public for promotion of positive health under Preventive healthcare.

Annual Report on CSR as required to be annexed in terms of requirement of Section 135 of Companies Act, 2013 and rules framed there under is annexed herewith and marked Annexure-3.

EVALUATION OF THE BOARDâS PERFORMANCE

In accordance with the requirements of the Companies Act 2013, the performance evaluation of the Board was carried out during the year under review. The Board follows a formal mechanism for the evaluation of the performance of the Board as well as Committee. The evaluation reflected the overall engagement of the Board and the Committee.

The Nomination and Remuneration Committee at its meeting established the criteria based on which the Board evaluate the performance of the Directors.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Non-Independent Directors and Board as a whole was also carried out by the Independent Directors.

The Directors expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Rajendra Chamaria and Mr. Pankaj Kejriwal will retire by rotation and being eligible, offer themselves for re-appointment. In view of their considerable experience, your Directors recommend their re-appointment as Directors of the Company.

The following personnel are Key Managerial person of the Company:

1. Mr. Sajjan Bhajanka : Managing Director

2. Mr. Rajendra Chamaria : Managing Director

3. Mr. Sanjay Agarwal : Managing Director

4. Mr. Sanjay Kumar Gupta : Chief Executive Officer

5. Mr. Dilip Kumar Agarwal : Chief Financial Officer

6. Mr. Manoj Agarwal : Company Secretary

HOLDING, SUBSIDIARIES AND ASSOCIATE COMPANY

Star Ferro and Cement Limited continues to remain the Holding Company with a stake of 70.48% in your Company.

M/s. Star Cement Meghalaya Limited, M/s. Megha Technical & Engineers Private Limited, M/s. Meghalaya Power Limited and M/s. NE Hills Hydro Limited continue to remain subsidiaries of the Company.

Star Cement Meghalaya Limited is engaged in manufacturing of Cement Clinker and has a Clinkerization plant with an installed capacity of 1.75 MTPA. During the year under review, the Company manufactured 1,629,025 MT of clinker as against 1,549,349 MT in FY 2014-15.

Megha Technical Engineers Private Limited is engaged in the manufacture of cement and generation of power. During the year under review, the Company produced 255,422 MT of Cement.

Meghalaya Power Limited is engaged in generation of Power. During the year under review the Company generated 1831.14 Lac units of power.

NE Hills Hydro Ltd., wholly owned subsidiary of your Company is currently not operational.

AUDITED FINANCIAL STATEMENTS OF THE COMPANYâS SUBSIDIARIES

Pursuant to sub-section (3) of Section 129 of the Companies Act, 2013, the statement containing the salient features of the financial statement for the year ended March 31, 2016 for each of the Companyâs subsidiaries viz. Star Cement Meghalaya Limited (SCML), Megha Technical & Engineers Private Limited (MTEPL), Meghalaya Power Limited (MPL) and NE Hills Hydro Limited (NHHL) are annexed in the in Form AOC - 1 and marked as Annexure-4.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company have been prepared as per Accounting Standards-AS 21, as prescribed by the Institute of Chartered Accountants of India and has been included as a part of this Annual Report.

The detailed financial statements and audit reports of each of the subsidiaries of the Company are available for inspection at the Registered Office of the Company during office hours between 11 A.M. and 1 PM. The Company will arrange to send the financial statements of the subsidiaries upon written request from a shareholder to the registered address of the said shareholder.

DEPOSITS

CHANGES IMPACTING GOING CONCERN STATUS AND COMPANYâS OPERATIONS

During the year under review, there have been no material orders passed by the Regulators/Courts impacting materially the going concern status or future operations of the Company.

There were no material changes and commitments affecting the financial position of the Company during the period under review.

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

INTERNAL CONTROL OVER FINANCIAL REPORTING

The Company has in place adequate internal financial controls commensurate with the size, scale and complexity of its operations. During the year, such controls were tested and no reportable material weakness in the design or operations were observed. The Company has policies and procedures in place for ensuring proper and efficient conduct of its business, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

RISK MANAGEMENT

Risk management refers to the practice of identifying potential risks in advance, analyzing them and taking precautionary steps to reduce the risk. The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.

COMMITTEES OF THE BOARD

The details of composition of the Committees of the Board of Directors are as under:

a. Audit Committee

During the year, the Meetings were held on 28th April, 2015, 22nd July, 2015, 2nd November, 2015 and 8th February, 2016. The composition of the Committee and the attendance details of the members are given below:

Name of the Director	Category	Chairman/ Members	No. of Meetings
			Held	Attended
Mr. Mangilal Jain	Independent	Chairman	4	4
Mr. Manindra Nath Banerjee	Independent	Member	4	4
Mr. Sajjan Bhajanka	Non-Independent	Member	4	4

- Vigil mechanism

A Vigil (Whistle Blower) mechanism provides a formal mechanism to the Employees and Directors to report to the Management, concerns about unethical behavior, actual or suspected fraud or violation of the Codes of conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases.

b. Nomination & Remuneration Committee

In accordance with the requirements of Section 178 of the Companies Act, 2013, the Committee identifies, screens and review individuals to assess eligibility of individual to be appointed as Director, Key Managerial Personnel and Senior Management staff, as and when required. The Committee also makes recommendations to the Board for such appointment and removal and carries out performance evaluation of all the directors.

During the year, the Committee met on 28^th April, 2015. The composition of the Committee and the attendance details of the members are given below:

Name	Category	Chairman/ Members	No. of Meeting
			Held	Attended
Mr. Mangilal Jain	Independent	Chairman	1	1
Mr. Manindra Nath Banerjee	Independent	Member	1	1
Mr. B.B. Agarwal	Non-Executive	Member	1	1

c. Corporate Social Responsibility Committee

The Corporate Social Responsibility Committee is responsible for the implementation / monitoring and review of the policy and the activities undertaken under the CSR policy as framed by the Company.

During the year, the Committee met on 12th February, 2016. The composition of the Committee and the attendance details of the members are given below:

Name	Category	Chairman/ Members	No. of Meeting
			Held	Attended
Mr. Sanjay Agarwal	Non-Independent	Chairman	1	1
Mr. B.B. Agarwal	Non-Independent	Member	1	1
Mr. Mangilal Jain	Independent	Member	1	1

HUMAN RESOURCE DEVELOPMENT & INDUSTRIAL RELATIONS

The core of achieving business excellence lies in a committed, talented and focused workforce. People are the foremost stakeholders and are considered the building blocks of an organization. For achievement of business objectives, it is imperative to have a dedicated and talented pool of people.

The Company has always provided a congenial atmosphere for work to all sections of society. It has provided equal opportunities of employment to all irrespective to their caste, religion, colour, marital status and sex. The Company believes that human capital of the Company is its most valuable assets and its human resource policies are aligned towards this objective of the Company.

The Company adopts latest techniques in evaluating the potential and training needs of the employees at all levels. Designing of tailor-made training programs that fill the knowledge/skill gap and imparting in-house training in addition to utilizing external programs are significant functions of HR Department of the Company.

PARTICULARS OF EMPLOYEES

Disclosure pertaining to the remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) of The Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 framed there under in respect of the information on employees who were in receipt of remuneration of not less thanRs,60 Lacs during the year orRs,5 Lacs per month during any part of the year forms part of this report and will be provided to any Member on a written request to the Company Secretary.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their deep sense of gratitude to the Banks, Central and State Governments and their departments and the Local Authorities, Customers, Vendors, Business Partners/Associates and Holding Company for their continued guidance and support.

Your Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Company and dedicates the credit for the Companyâs achievements to them. Last but not least, your Directors express their gratitude to the shareholders of the Company for reposing their confidence and faith in the Management of the Company.

For and on behalf of the Board of Directors

SAJJAN BHAJANKA

Place: Kolkata Chairman

Date: 2^nd May, 2016 (DIN: 00246043)

Mar 31, 2015

Dear Shareholders,

Your Directors have pleasure in presenting Fourteenth Annual Report of the Company together with the Audited Balance Sheet as at 31st March, 2015 and the Statement of Profit & Loss for the year ended on that date.

FINANCIAL PERFORMANCE

The highlights of the financial performance of the Company for the financial year ended 31st March, 2015 as compared to the previous financial year are as under:

(Rs,in Lacs)

Particulars	Consolidated		Standalone
	2014-15	2013-14 1	2014-15	2013-14
Net Sales / Income	143,120.91	103,060.96	111,408.52	73,675.38
Profit before Interest, Depreciation, Tax and extra ordinary items	43,723.31	23,650.50	17,599.61	6,595.92
Extraordinary Items	1.83	(102.39)	(1.31)	(108.11)
Profit before Interest, Depreciation and Tax	43,725.14	23,548.11	17,598.30	6,487.81
Interest & Finance Charges	(8,738.44)	(8,344.19)	(4,452.40)	(3,486.25)
Depreciation	(22,374.29)	(15,683.18)	(8,645.70)	(4,531.79)
Profit/(Loss) before Tax	12,612.41	(479.26)	4,500.19	(1,530.23)
Provision for taxation:
- Current Tax	2,640.09	87.87	953.27	-
- Less: MAT credit entitlement	(2,640.09)	-	(953.27)	-
- Net Current Tax	-	(87.87)	-	-
-MAT Credit entitlement of earlier years	-	(26.61)	-	-
- Income Tax for earlier years	16.52	0.40	-	-
- Deferred Tax	(496.65)	247.62	102.44	(39.15)
-Minority Interest	(266.88)	(74.15)	-	-
Net Profit after Tax (after minority)	11,865.39	(419.88)	4,602.63	(1,569.38)
Add: Balance as per the last financial statement	52,443.43	54,209.46	36,257.92	39,173.45
Profit available for appropriation	64,308.82	53,789.58	40,860.54	37,604.06
Appropriations:
General Reserve	-	(120.00)	-	(120.00)
Proposed Dividend on Equity Shares	(3,353.71)	-	(3,353.71)	-
Corporate Dividend Tax	(670.55)	(178.11)	(670.55)	(178.11)
Interim Dividend	-	(1,048.03)	-	(1,048.03)
Total	(4,024.26)	(1,346.15)	(4,024.26)	(1,346.15)
Balance carried forward to Balance Sheet	60,284.57	52,443.43	36,836.29	36,257.92

OPERATIONAL PERFORMANCE

FY 2014-15 has been more a year of consolidation for operations of your Company and its subsidiaries. The operational performance of clinkerisation unit of subsidiary M/s. Star Cement Meghalaya Limited and grinding unit at Guwahati was further stabilized. M/s. Star Cement Meghalaya Limited has been able to produce 15,49,349 MT of clinker during FY 2014-15 as against 11,02,905 MT during FY 2013-14 registering a growth of 40%. In terms of capacity utilization, the unit was able to utilize close to 89% of its installed capacity in FY 2014-15 as against 63% during FY 2014-15. Similarly, the grinding unit at Guwahati produced 14,44,955 MT of Cement during FY 201415 as against 954,679 MT registering a growth of 51% over previous year. On capacity utilization front too, the Guwahati grinding unit was able to operate at 90% of its installed capacity during FY 2014-15 as against 60% during FY 2013-14.

On Consolidated basis total clinker production was at 18,79,359 MT during FY 2014-15 as against 13,78,616 MT during FY 2013-14, registering a growth of 36%. Your Company has made arrangements with grinding units in West Bengal also to supplement its market requirement. The total cement production on Consolidated basis (including the hired Grinding units) was at 21,71,666 MT during FY 2014-15 as against 16,64,037 MT during FY 2013-14 registering a growth of 31%.

On the sales side too, your Company has been able to register highest ever sales volume during FY 2014-15. Your Company has been able to sale 21,69,251 MT of Cement in FY 2014-15 as against 16,31,048 MT during FY 2013-14, registering a growth of 33% over previous year.

With improved outlook of economy during the ensuing financial years, your Company expects to improve its performance on operational side even better.

INDIAN ECONOMY AND GLOBAL CONDITIONS

After prolonged stagnation observed in Indian Economy in recent past, year 2014-15 started showing indications of consolidation and recovery. This is getting reflected through various indicators like annual growth rate of Gross Domestic Product (GDP) was seen to improve to 7.5 per cent in the last October-December quarter as against 6.4 per cent in the October-December quarter of 2013. GDP growth in the first three quarters of the FY15 has averaged at 7.4 per cent, year on year basis.

On the inflation side, sustained efforts by Government to control price rise coupled with falling crude prices resulted into lower inflationary pressure. Food Inflation index has fallen tremendously from 9.66 per cent around April, 2014 to 4.78 per cent by December, 2014. Retail inflation (CPI-Consumer Price Index) has also moderated. It declined to all time low of 5 per cent in Q3 of 2014-15 after having remained stubbornly stuck around at 9-10 percent for last 2 years. The Rupee remained relatively stable, and the Current Account Deficit (CAD) is continuously shrinking from 2 per cent of GDP in Q4 of 2013-14 to 1.6 per cent in Q3 of 2014-15.

Initiatives undertaken by Government in the areas of unblocking of Coal Blocks, allocation of Telecom Spectrum, deregulation of diesel prices resulting into reduced cost of import bills and visible intent of New Government at Centre to bring reforms in Financial and Economic Sectors has boosted overall confidence of investors in Indian Economy which is well reflected by data of Foreign Direct Investment that has increased from USD 2133 million by March, 2014 to USD 5502 Million by January,

2015.The Business confidence index has been continuously rising from 49.90 in Q4 of 2013-14 to 56.40 in Q4 of 201415. The Consumer confidence index also shows positive signs.

On the other hand performance of other economies of the globe was uneven and mixed. In Europe and Advanced European countries there are signs of pickup and some positive momentum in the euro area, reflecting lower oil prices and supportive financial conditions, but risks of prolonged low growth and low inflation remain. Economic activity softened in emerging and developing Europe last year, and more countries slipped into deflation. External demand remains subdued and high corporate debt continues to weigh on investment. Asiaâs growth is forecast to hold steady in 2015, and the region is expected to continue outperforming the rest of the world over the medium term. While the Chinese economy is shifting to a more sustainable pace, growth is projected to pick up elsewhere in the region. This reflects the boost from lower world oil prices, strengthening external demand, and still-accommodative financial conditions despite some recent tightening. Growth in Latin America and the Caribbean slowed to 1.3 percent in 2014 and is projected to soften to an even lower rate in 2015.

INDIAN CEMENT INDUSTRY - RETROSPECT AND OUTLOOK

In line with trend of recovery in Indian Economy as a whole, Indian Cement Industry has also shown trend of recovery during FY 2014-15. After witnessing an all-time low demand and profitability during the previous financial year, in the first nine months of FY 2014-15 cement productions has grown by 7.90% as against 3.70% in corresponding period last year and 3% in FY 2013-14. Apart from other economic factors which helped the economy as a whole to grow, the delayed monsoons which extended the window for continuation of construction activities helped cement industry in particular to grow during the year under review.

The recent past has witnessed a slowdown in the new capacity addition in cement industry due to demand constraints. Between FY 2010-11 to FY 2013-14 the industry added 65 MTPA cement capacity as against 92 MTPA in the preceding three-year period of FY 2007-08 - FY 2010-11.

The slowdown in demand resulted into lower capacity utilization from 77% in FY 12 to 72% in FY 14 despite slowdown in fresh capacity addition.

The growth outlook for Indian cement industry remains positive on the back of rising infrastructure activities, increasing demand from Housing Sectors and recovery witnessed in construction industry. Recent developments in the industry supported by Governments initiatives in form of considerable thrust and importance assigned for the development of Infrastructure, Roads, Urban and Rural Housing, Ports, Ultra Mega Power Projects etc., the demand outlook remains positive in the years to come. During next three years it is expected that demand would grow by more than 8% leading to increase in rate of capacity utilization from 72% in FY 14 to 75% in FY 16. The capacity utilization is likely to further improve to 79% in FY 17.

The major cost drivers of cement industry being logistic cost, power and fuel remained under pressure. Falling crude oil prices in international market coupled with deregulation of diesel prices in the country resulted into availability of diesel at lower prices. However, the increase in rates of railway freight has offset this benefit. Timely availability of Railway Rakes was another constraint which industry as a whole had to face on logistic front. Price and availability of quality coal remained a constraint for the industry during the year under review too. Non-availability of coal to power plants resulted into restricted power supply which had implication on power cost too. However, unblocking of coal blocks in recent past is likely to help the power and cement industry both.

CEMENT SCENARIO - EAST

Looking at huge potential and opportunities in the North Eastern Region (NER) as a whole, NER Markets continue to remain the focus market for your Company. In line with trend of slowdown in economic activities in rest of the country, the economic activities in NER also witnessed to grow at a slower pace but still faster than rest of country owing to its under developed status in recent years. NER represents 9 per cent of Indiaâs geographical area and contributes 3 per cent to the countryâs gross domestic product (GDP). In relative terms, it is one of Indiaâs economically under-developed regions. However, given its natural resources base and strategic location, NER has the potential to become Indiaâs "powerhouseâ in terms of trade and investment. Although the NER is rich in resources like hydrocarbons and other minerals and has immense potential to produce hydroelectricity, absence of adequate infrastructure has impeded its development.

Owing to its geographical location, NER is unique in terms of the economic opportunities it offers. About 98 per cent of the region borders form Indiaâs international boundaries. It shares borders with China, Bangladesh, Bhutan and Myanmar. Given its strategic location, the region has potential to be developed as a base for Indiaâs growing economic links not only with the Association of Southeast Asian Nations (ASEAN) but also with neighboring countries, viz. Bangladesh, Bhutan, and Nepal.

The North East Region (NER) is a land of opportunities, with huge potential for growth and development. On the Hydro Power Front, the region of North East is said to be ''The Power House of Indiaâ. It has been estimated that North Eastern States including Sikkim have the potential of 84,000 MW of hydro power which is about 43 per cent of the total hydro power generation capacity in the country. Conversely, only five per cent of its potential has been harnessed so far. The Central Government is promoting private sector in the region to boost investment in power sector and about 14,000 MW has already been allotted to private players in NER as part of "50,000 MW hydro initiativeâ.

Road is an important mode of travel in the hilly areas as other mode of travel is either too expensive or difficult. The road infrastructure is relatively deficient in the NER. To address this, The Ministry of Road Transport and Highways has been paying special attention to the development of national highways in the region. The ministry has earmarked 10% of the total allocation for the NE region. There has also been a special thrust in building the road infrastructure. Sufficient funds have also been allocated in building the road infrastructure in the NE states.

The coverage of Railway still remains poor in the region. The Ministry of Railways has undertaken a lot of gauge conversion and new line projects in the North Eastern Region. At present, there are 7 new lines, 6 gauge conversion, 2 doubling and 3 railway electrification ongoing railway projects under North Eastern Railway. New railway lines on Azra-Byrnihat, Dudhnoi-Mehendi Pather and Byrnihat-Shillong routes in Meghalaya are under construction. The construction of the extension of a vital broad gauge rail link between Bairabi rail terminus on the Mizoram-Assam border and Sairang, a village 20 km west of Aizawl, is in progress. In Sikkim rail connectivity is being created between Rangpoo and Siliguri in West Bengal. A railway track is also to be laid for connecting Agartala with Akhaura in Bangladesh.

All above infrastructure development projects is expected to convert in huge cement demand in NER. On the retail side of demand, with increased focus on housing sector, retail demand in the region is likely to get a boost. Per Capita Cement consumption in NER is lowest in the country presenting huge potential for cement demand. In line with trend of Indian Economy, the per capita income and disposable surplus has seen a rising trend in NER also. This has led to a boost in retail housing sector too.

In the backdrop of above, NER presents huge opportunities for cement demand in the North Eastern Region. As mentioned earlier, your Company has been able to register a growth of 5.78% in sale of Cement in NER during the year under review over previous year. On the capacity side, there is no major cement capacity in pipeline in NER and in the backdrop of potential demand growth expected to come in NER owing to ongoing and upcoming infrastructure projects coupled with surge in retail demand, your Company enjoys strategic advantage of having its surplus capacity in the region.

Keeping strong foothold intact in the markets of NER and consolidating its position further, your Company is expanding its reach in other parts of Eastern India in the States of West Bengal and Bihar. As compared to rest of India, the Eastern Part is still under-developed in terms of infrastructure and also in housing sector. The per capita consumption of Cement in West Bengal, Bihar and Jharkhand is much lower to rest of India. Capitalizing on the growth opportunities existing in these States of East, your Company had launched its product during later part of FY 2013-14 and during the year under review has been able to make the presence of its brand "STAR CEMENTâ felt in these States. To augment on the capacity front, your Company has made arrangements with few grinding units in West Bengal. With strategically located clinker manufacturing facility in the State of Meghalaya having reach to quality limestone and quality fuel at relatively lower cost, the grinding unit arrangement in West Bengal presents strategic advantage to your Company to compete with relatively more established players in these States. The Company is expecting even better volumes in these markets in the ensuing financial year and years to come.

MARKET DEVELOPMENT

During FY 2014-15, your Company continued to enjoy Brand-Leadership position in the Markets of North Eastern Region (NER). With more stabilized operations of newly commissioned Cement Grinding Unit at Sonapur, Guwahati and Clinkerisation unit at Lumshnong in Meghalaya coupled with concerted marketing efforts, your Company was able to achieve highest ever volume in the markets of NER. During the year under review, the total sale in NER was at 14,98,380 MT as against 14,16,426 MT in FY 2013-14 registering a growth of 5.78% over previous year. During the first half of year under review, there was slowdown in cement demand in NER which started picking up in third quarter and the last quarter of the year closed at very healthy note in terms of demand pick-up. Companyâs focused approach to expand its reach in urban and semi-urban markets of NER resulted into consolidating the presence of your brand "STAR CEMENTâ and company was able to further improve its market share during the year under review.

Your Company has also added its product portfolio with value added feature and has recently launched its newly developed "Anti-Rust Cementâ in the markets of NER. The product is presently under test marketing and is expected to present a better volume in years to come.

As reported last year, your Company had launched its product in the same brand name "STAR CEMENTâ in the markets of West Bengal & Bihar. Your Directors are pleased to report that markets of West Bengal and Bihar have responded well for your product "STAR CEMENTâ in terms of demand and acceptability both. During the year under review, your Company has been able to achieve sale of 6,70,871 MT of Cement in these markets as against 214,622 MT during the FY 2013-14 registering more than 200% growth. In order to cater to the needs of markets of West Bengal, Bihar and adjoining State Jharkhand, your Company has tied up with two grinding units in West Bengal to augment its capacity, in addition to supplying cement to these markets from its own units located in Assam and Meghalaya.

The expansion of dealer and retail network in NER and more particularly in Rural and Semi-Urban Areas of the Region has remained to be focus area of your Company during the year under review too. Your Company has added more than 500 dealers and more than 1000 sub-dealers to the family. The strong dealer and retail network in NER and in the markets of West Bengal & Bihar coupled with huge branding activities has resulted into better product placement, acceptability and top of mind recall for your product "STAR CEMENTâ. On the back of strong dealer and retail network with consistency in product quality followed up by branding activities, your Company expects to put much improved performance at market place in the ensuing financial year.

PRODUCTION AND COST DEVELOPMENTS

Your Company has been able to further optimize on production and cost sides. With increased volumes during the FY 2014-15, your Company has been able to have advantage of spread of its fixed costs on increased volumes. In addition, the close proximity of coal and limestone added further to its cost effectiveness.

Fly Ash

Your Company continued to promote environment friendly blended cement using fly ash and produced 17,45,710 MT of Portland Pozzolana Cement (PPC) (including from hired grinding units) on consolidated basis out of total production of 21,71,666 MT of cement during FY 2014-15. Usage of fly ash in cement is not friendly to environment only but also provides cost optimization. Your Company has been able to utilize the fly ash generated by power plant of its subsidiary M/s. Meghalaya Power Limited and such close access to fly ash provides competitive edge to your Company in term of cost. In addition, your Company has also made arrangements with major power plants like NTPC, Tata Power and few others to ensure its long term requirement of fly ash.

Power cost

With more stabilized operations of its power subsidiary M/s. Meghalaya Power Limited, your Company has been able to reduce its dependency on state supplied grid power. Your Company has made long term arrangement with its subsidiary for supply of quality power at competitive rates. During the year under report, your Company has been able to capitalize on the opportunity of availability of reliable and quality power sourced from Indian Energy Exchange (IEX) for its grinding unit at Guwahati and has been able to reduce the power cost too by optimizing the source mix between power supplied by IEX and Grid.

Logistics & Freight

On Logistics front your Company has expanded distribution network in the states of West Bengal, Bihar & Jharkhand besides reaching out to interior most areas of North East India. Warehousing network was increased substantially during the year.

Railway siding near Guwahati Grinding Unit was constructed and commissioned in record time giving boost to Railway Rake handling capacity for inbound and outbound traffic while ensuring cost saving on Transportation and handling expenses.

Freight cost came under pressure during the year under review due to increase in Railway Freight and Road Freight in North East. Railway freight increased by 6.5% during July, 14. Your Company braved such inflationary situations through various innovative measures and using the right mix of mode of transportation through Rail, Road, Container and Bulkers. Your Company used online reverse auction for freight finalization ensuring competitive freights. Freight discount offered by railway on empty flow direction helped Company to partially neutralize the effect of increase in railway freight.

Railway network in North East has increased with commissioning of Broad Gauge Link from Lumding to Badarpur and Rangia to Silapathar. Your Company is geared up for taking best advantage of such developments.

Few of the major highlights of the performance are:

KEY PERFORMANCE HIGHLIGHTS

- Consolidated cement production was 21,71,666 MT during the year as against 16,64,037 MT during the previous financial year, registering a growth of 31%.

- Consolidated net sales wereRs,1,43,042.78 Lacs during the year under review as compared toRs,102,798.95 Lacs during the financial year 2013-14, registering a growth of 39%.

- Consolidated EBIDTA was 85% higher atRs,43,723.31 Lacs, as compared toRs,23,650.50 Lacs during the immediate previous financial year.

- Consolidated profit before tax during the year 2014-15 was atRs,12,612.41 Lacs as against a loss ofRs,479.26 Lacs in the year 2013-14.

SHARE CAPITAL

The paid up Equity Share Capital as on 31st March, 2015 wasRs,4,192.14 Lacs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options or sweat equity shares.

EXTRACT OF ANNUAL RETURN

In terms of requirement of Section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual return in form MGT-9 is annexed herewith and marked Annexure 1.

MEETINGS OF THE BOARD

During the year six (6) Board Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

MEETINGS OF INDEPENDENT DIRECTORS

During the year under review, a meeting of Independent Directors was held on 19th March, 2015 wherein the performance of the Non-Independent Directors and the Board as a whole was reviewed. The Independent Directors at their meeting also assessed the quality, quantity and timeliness of flow of information between the Company management and the Board of Directors of the Company.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to requirement of Section 134 (3) (c) read with Section 134 (5) of the Companies Act, 2013, the Directors hereby confirm and state that:

- In the preparation of Annual Accounts, the applicable Accounting Standards have been followed along with the proper explanation relating to material departures, if any;

- The Directors have selected such accounting policies and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2015 and of the profit of the Company for the year under review;

- The Directors have prepared the annual accounts ongoing concern basis;

- The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013. Mr. Manindra Nath Banerjee and Mr. Mangilal Jain are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfill the conditions specified in Section 149 of the Act and the Rules made there under about their status as Independent Director of the Company.

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS

The Board has framed a Remuneration Policy for selection, appointment and remuneration of Directors, Key Managerial Personnel and Senior Management staff. The remuneration policy aims to enable the Company to attract, retain and motivate highly qualified members for the Board and at other executive levels. The remuneration policy seeks to enable the Company to provide a well-balanced and performance-related compensation package, taking into account shareholder interests, industry standards and relevant Indian corporate regulations.

AUDITORS & AUDITORS'' REPORT

M/s. Kailash B. Goel & Co., Chartered Accountants, Statutory Auditors (Firm Registration no. 322460E) of the Company, will retire at the conclusion of the ensuing Annual General Meeting of the Company. Being eligible, they have offered themselves for re-appointment and have confirmed that their appointment, if made, will be in accordance to the provisions of Section 141 read with Section 139 of the Companies Act, 2013 and the rules framed there under for re-appointment of Auditors. Members are requested to approve and ratify their appointment. Members are also requested to empower the Board for fixation of Auditorsâ Remuneration.

The Auditorsâ Report to the Shareholders for the year under review does not contain any qualification.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules,

The Board, on recommendation of Audit Committee, has appointed M/s. B. G. Chowdhury & Co., Cost Accountants, for audit of cost records for the ensuing financial year. The remuneration proposed to be paid to them as recommended by Audit Committee requires ratification of the shareholders of the Company. In view of this, your ratification for payment of remuneration to Cost Auditors is being sought at the ensuing AGM.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Manoj Kumar Banthia, Practising Company Secretary, M/s. MKB & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith marked Annexure 2. The report is self-explanatory and do not call for any further comments.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, your Company has not given any loan to any person falling under ambit of Section 186 of the Companies Act, 2013.

Details of Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year under review were entered on an armâs length basis and in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

A Statement of all related party transactions is presented before the Audit Committee on quarterly basis. The details of transactions entered into with the Related Parties are annexed herewith and marked Annexure 3.

RESERVES

During the year under review no amount was transferred to reserves.

DIVIDEND

Your Directors are pleased to recommend a Final Dividend of 80% (H8/- per equity share ofRs,10/- each) (Previous year: Interim Dividend @ 25%, i.e.,Rs,2.50 per equity share ofRs,10/- each). Total payout on account of Dividend for the year under review amounts toRs,4,024.26 Lacs including Dividend Distribution Tax ofRs,670.55 Lacs.

CONSERVATION OF ENERGY (STEPS TAKEN / IMPACT ON CONSERVATION OF ENERGY, STEPS TAKEN FOR UTILISING ALTERNATE SOURCES OF ENERGY, CAPITAL INVESTMENT IN ENERGY CONSERVATION EQUIPMENTS)

Your Company has taken following steps towards Conservation of Energy during the year under review:

- Optimization of Load on incoming transformers;

- Generation pressure of compressor was reduced;

- Leakages in compressed air line of cement mill and CSP were arrested;

- Dampers were removed to avoid pressure loss in RABH fan;

- RPM of Cement Mill Pump was reduced;

- Removal of Damper to avoid pressure loss across fans in Raw Mill Silo;

- Modification was carried out in Coal Mill inlet chute by fixing polymer liner;

- Feed opening of the Inlet chute of Coal Mill was increased, to arrest frequent of the chute;

TECHNOLOGICAL ABSORPTION:

- Development of New Product with Anti-Rust properties;

- Replacement of Mill Scale with Laterite Clay in Raw Mill;

- Trial on optimization of Fly Ash Mix;

- Trial on automation of Fly Ash feeding system.

EXPENDITURE ON RESEARCH & DEVELOPMENT

The Company has developed a Research & Development cell for carrying out R&D Projects in the plant with specific objective of development of advanced systems for quality improvement.

During the year under review, your Company incurred Capital expenditure ofRs,40.28 Lacs and Revenue Expenditure ofRs,38.38 Lacs in Research & Development.

FOREIGN EXCHANGE EARNINGS AND OUTGO

During the period under review, Foreign Exchange Earning wasRs,51.58 Lacs and the Foreign Exchange Outgo wasRs,9,213.37 Lacs.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES (CSR)

Your Company is committed to communities in remote areas of its geographical presence where the Company essentially operates and gives prime importance to sustainable development of the entire region. With an aim to make CSR a progressive model, the Company, has aligned its CSR policy & practices in accordance with Schedule VII of Companies Act, 2013.

Your Companyâs CSR strategy ensures compliance with ethical standards in business practices; minimizing environmental impacts and waste; addresses the challenges of improved access to education, health, sports, drinking water, sanitation and livelihood opportunities; and helping underprivileged communities to become resilient and self-reliant.

The Companyâs quest for improved literacy and education in Lumshnong region saw the advent of CMCL VidyaMandir, which is imparting quality education up to secondary level under CBSE affiliation. Extension of school building is being undertaken in full pace to upgrade the school to higher secondary level in the forthcoming years. The school is actively reaching out to the locals of surrounding communities by providing free-ships to the underprivileged. Additionally, your Company is also supporting few government affiliated schools of the periphery villages by meeting their infrastructural and day-to-day educational needs.

The Company has been actively participating in socio-economic development of Lumshnong region and other surrounding villages and has been one of the key contributors to the Local Villages and NarpuhElaka (local territory) Development Funds. A need based strategy has been followed in consultation with local headman in constructing a community hall and few internal concrete roads in Lumshnong village. With a view to increase access to livelihood opportunities, your Company has been engaging local people as suppliers of limestone, coal, river sand etc.

The Company is providing quality health care facilities through CMCL hospital. With its qualified team of doctors and support staff, the hospital is facilitating out and in-patient medical care, pathology, x-ray, dispensary and ambulance facility to meet any emergency condition. During the year under review several free community health check-up and vaccination camps were conducted by your Company.

The Company is also a frontrunner in nurturing local sporting talent. During the year under review local football team from Lumshnong village has been actively supported with infrastructural requirements and equipments.

To reinforce its commitments as a responsible corporate citizen, your Company has a dedicated team to implement, monitor & evaluate community engagement programmes. Your Company has plans to set a benchmark to sustainable development of Community and local area through its cutting edge CSR programme. Over the years, CMCL has been efficiently able to hold on to what is good; hold on to what it believed; hold on to what it must do to promote itself from a doerâs to enablerâs.

Annual Report on CSR as required to be annexed in terms of requirement of Section 135 of Companies Act, 2013 and rules framed there under is annexed herewith and marked Annexure- 4.

EVALUATION OF THE BOARD''S PERFORMANCE

In accordance with the Companies Act 2013, the performance evaluation of the Board was carried out during the year. The Board follows a formal mechanism for the evaluation of the performance of the Board as well as Committee. The evaluation reflected the overall engagement of the Board and the Committee.

The Nomination and Remuneration Committee at its meeting established the criteria based on which the Board will evaluate the performance of the Directors.

The Directors expressed their satisfaction over the evaluation process and results thereof.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The shareholders have ratified the appointment of Mr. Manindra Nath Banerjee as Independent Director who was appointed as Additional Director with effect from 15th July, 2014 by the Board as also appointment of Mr. Mangilal Jain as Independent Director at the Annual General Meeting held on 10th September, 2014 for a period of five years.

Further, Mr. Sanjay Agarwal was appointed as Managing Director of the Company with effect from 1st August, 2014 which was ratified by the shareholders at their Annual General Meeting held on 10th September, 2014. Also, Mr. Sajjan Bhajanka, Mr. Rajendra Chamaria and Mr. Sanjay Agarwal were re-appointed as Managing Director for a further period of 3 years subject to the ratification in the ensuing General Meeting.

In accordance with the provisions of Companies Act, 2013 and in terms of the Memorandum and Articles of Association of the Company, Mr. Prem Kumar Bhajanka and Mrs. Clara Suja will retire by rotation and being eligible, offers themselves for re-appointment. In view of their considerable experience, your Directors recommend their re-appointment as Directors of the Company.

During the year under review, the Board on the recommendation of the Nomination and Remuneration Committee appointed Mr. Dilip Kumar Agarwal as Chief Financial Officer with effect from 20th September, 2014 and Mr. Sanjay Kumar Gupta was appointed as Chief Executive Officer with effect from 26th March, 2015.

The following personnel are Key Managerial person of the Company:

1. Mr. Sajjan Bhajanka : Managing Director

2. Mr. Rajendra Chamaria : Managing Director

3. Mr. Sanjay Agarwal : Managing Director

4. Mr. Sanjay Kumar Gupta : Chief Executive Officer

5. Mr. Dilip Kumar Agarwal : Chief Financial Officer

6. Mr. Manoj Agarwal : Company Secretary

HOLDING, SUBSIDIARIES AND ASSOCIATE COMPANY

Star Ferro and Cement Limited continue to remain the Holding Company with a stake of 70.48% in your Company.

M/s. Star Cement Meghalaya Limited, M/s. Megha Technical & Engineers Private Limited, M/s. Meghalaya Power Limited and M/s. NE Hills Hydro Limited continue to remain subsidiaries of the Company.

Star Cement Meghalaya Limited is engaged in manufacturing of Cement Clinker and has a Clinkerisation plant with an installed capacity of 1.75 MTPA. During the year under review, the Company manufactured 15,49,349 MT of clinker as against 11,02,905 MT in FY 2013-14.

Megha Technical & Engineers Private Limited is engaged in the manufacture of cement and generation of power. During the year under review, the Company produced 3,20,836 MT of Cement.

Meghalaya Power Limited is engaged in the generation of Power. During the year under review the Company generated 1679.23 Lacs units of power

NE Hills Hydro Ltd., wholly owned subsidiary of your Company is currently not operational.

AUDITED FINANCIAL STATEMENTS OF THE COMPANY''S SUBSIDIARIES

Pursuant to sub-section (3) of Section 129 of the Act, the statement containing the salient feature of the financial statement for the year ended 31st March, 2015 for each of the Companyâs subsidiaries viz. Star Cement Meghalaya Limited (SCML), Megha Technical & Engineers Private Limited (MTEPL), Meghalaya Power Limited (MPL) and NE Hills Hydro Limited (NHHL) are annexed in the Form AOC - 1 and marked as Annexure-5.

CONSOLIDATED FINANCIAL STATEMENTS

The detailed financial statements and audit reports of each of the subsidiaries of the Company are available for inspection at the registered office of the Company during office hours between 11 A.M. and 1 P.M. The Company will arrange to send the financial statements of the subsidiaries upon written request from a shareholder to the registered address of the said shareholder.

DEPOSITS

CHANGES IMPACTING GOING CONCERN STATUS AND COMPANY''S OPERATIONS

During the year under review, there have been no material orders passed by the Regulators/Courts impacting materially the going concern status or future operations of the Company.

ADEQUACY OF INTERNAL FINANCIAL CONTROL

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board.

RISK MANAGEMENT

The Company has evolved a risk management framework to identify, assess and mitigate the key risk factors of the business. The Board of the Company is kept informed about the risk management of the Company.

COMMITTEES OF THE BOARD

The details of composition of the Committees of the Board of Directors are as under:-

a. Audit Committee

Your Company has an Audit Committee at the Board level, which acts as a link between the management, the statutory and internal auditors and the Board of Directors to oversee the financial reporting process. During the year the Audit Committee was reconstituted as per the requirements of Section 177 (2) of the Companies Act, 2013.

The Composition of the Committee is as mentioned below:
Sl. No.B Name of the Director	Category	Chairman/ Members
1. Mr. Mangilal Jain	Independent	Chairman
2. Mr. Manindra Nath Banerjee	Independent	Member
3. Mr. Sajjan Bhajanka	Non-Independent	Member

During the year, the Committee met on 17th May, 2014, 7th July, 2014, 15th October, 2014, 13th January, 2015.

- Vigil mechanism

Pursuant to the requirement of the Act, the Company has established vigil mechanism. The Board has framed a Vigil Mechanism Policy of the Company. A Vigil (Whistle Blower) mechanism provides a channel to the Employees and Directors to report to the Management, concerns about unethical behavior, actual or suspected fraud or violation of the Codes of conduct or policy. The mechanism provides for adequate safeguards against victimization of employees and Directors to avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in exceptional cases.

b. Nomination & Remuneration Committee

The Board of company has also constituted a Committee for appointment and remuneration of Directors, Key Managerial Personnel and Senior Management staff. The Committee was reconstituted during the year under review as per the requirements of Section 178(1) of the Companies Act, 2013 with the following members:

Sl. No.	Name	Category	Chairman/ Members
1.	Mr. Mangilal Jain	Independent	Chairman
2.	Mr. Manindra Nath Banerjee	Independent	Member
3.	Mr. Brij Bhushan Agarwal	Non-Independent	Member

During the year, the Committee met on 6th July, 2014, 18th September, 2014 and 25th March, 2015.

a. Corporate Social Responsibility Committee

During the year under review the Company has constituted

Corporate Social Responsibility Committee as per the requirements of Section 135 of the Companies Act, 2013. The Committee is headed by Mr. Sanjay Agarwal, Director of your Company and consists of members as stated below:

HUMAN RESOURCE DEVELOPMENT & INDUSTRIAL RELATIONS

Sl. No.	\| Name of the Director	Category	Chairman/ Members
1.	Mr. Sanjay Agarwal	Non-Independent	Chairman
2.	Mr. Brij Bhushan Agarwal	Non-Independent	Member
3.	Mr. Mangilal Jain	Independent	Member

During the year under report, your Company completed 10 successful years since it commenced its commercial operations. Your Company recognized the association of all those employees who have completed ten successful years with your Company in a function held at all factories and offices of the Company.

PARTICULARS OF EMPLOYEES

The information required under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the employees of the Company is as mentioned below:

Name	Mr. Sanjay Kumar Gupta
Remuneration (Gross)	H73,72,000/-
Designation & Nature of Employment	Chief Executive Officer*
Qualification and total experience	Chartered Accountant
Date of commencement of employment	10.03.2003
Total experience	22 years
Age	45 years
Last employment	Vinaya Cement Ltd.

*Designated as Chief Executive Officer w.e.f. 26.03.2015.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their deep sense of gratitude to the Banks, Central and State Governments and their departments and the local authorities, customers, vendors, business partners/associates and Holding Company for their continued guidance and support.

Your Directors would also like to place on record their sincere appreciation for the commitment, dedication and hard work put in by every member of the Company and dedicates the credit for the Companyâs achievements to them. Last but not least, your Directors express their gratitude to the shareholders of the Company for reposing their confidence and faith in the Management of the Company.

For and on behalf of the Board of Directors

Place: Kolkata SAJJAN BHAJANKA

Date: 28th April, 2015 Chairman

(DIN: 00246043)

Mar 31, 2014

Dear Members,

2013-14 - CHALLENGES - A JOURNEY IN RETROSPECT AND OUTLOOK Indian Economic Environment and Global conditions

The global growth outlook has largely remained unchanged during the year 2013. Growth is likely to be in the region of

3.5 per cent in 2014, about half a percentage point higher than in 2013. The expansion is expected to be led by advanced economies, especially the US. Accommodative monetary policy and reforms in the aftermath of the global financial and the euro zone crises have slowly started bearing fruit in advanced economies. After a soft patch at the start of the year 2013, US economic activity is expected to pick up during 2014 on the back of strong corporate financials, favorable financing conditions, smaller fiscal drag and strong price competitiveness. Moreover, after prolonged recession, the euro zone area is expected to contribute positively to global growth in 2014.

Emerging Markets and developing economies, however, had to face inflationary pressures, though actions in tightening monetary policy and slack in output are expected to generate some disinflationary momentum. These economies also face new risks on account of more tightened monetary policies. Although, growth picked up in these markets, momentum looked weak as compared to advanced economies.

On the back of above, India''s GDP growth for 2013-14 is expected at 4.6 per cent, close to the decade-low growth of 4.5 per cent clocked in 2012-13. However, GDP growth for 201415 is expected to hover around little above 5%. Consumer price inflation still remains an important challenge, and is expected to trend down. Further tightening of the monetary stance might be needed for a durable reduction in inflation and inflation expectations.

Mining and Infrastructure Sectors performed better in recent past. Key Indicators suggest that Manufacturing Sector continues to be an area of concern with the sector, registering a decline of 3.7 per cent in February 2014, against stagnant production in January. Recent IIP estimates also suggest revival may turn out to be a protracted process. The sector''s dismal performance has been driven largely by the fall in domestic demand. Private final consumption expenditure grew by 2.5 per cent in 2013-14, as against 9.6 per cent 2011-12 implying that domestic-demand-driven industries are seeing sustained weakness.

However, business sentiments are expected to revive with formation of "stable governmentâ and normal monsoon and country is expected to perform better in time to come on economic front in general and on industrial front in particular.

Indian Cement Industry

On the backdrop of continued recessionary conditions prevailing in Indian economy, Indian Cement Industry has witnessed flat growth during the fiscal 2013-14 which has been largely on account of adverse macro environment prevailing almost through the year. Slowdown in infrastructure sector and prolonged monsoon added further woos for the industry. Lower than expected growth in consumption pattern of cement was mainly on account of higher lending rates in housing sector, a virtual halt in government spending on infrastructure sector as also higher borrowing cost in commercial segment.

The recent years witnessed huge capacity addition in cement industry. Lower than expected growth in demand on account of reasons mentioned above, has resulted into lower capacity utilization. Lower capacity utilization has resulted into pressure on absorption of fixed costs, on the other hand, inflationary conditions have resulted into higher variable cost in form of increase in freight, power and raw material costs. All factors taken together have resulted into contraction in margins and bottom lines of companies.

Key highlights 2013 -14

- Consolidated cement production was 16,64,037 MT during the year as against 10,67,465 MT during the previous financial year, registering a growth of 56%.

- Consolidated net sales were H102,798.95 Lacs during the year under review as compared to H59,497.13 Lacs during the financial year 2012-13, registering a growth of 73%.

- Consolidated EBIDTA was 96% higher at H23,650.50 Lacs as compared to H12,047.69 Lacs during the immediate previous financial year.

Financial results (Rs,in Lacs)

Particulars	Consolidated		Standalone
	2013-2014	2012-2013	2013-2014	2012-2013
Net Sales / Income	103, 060.96	59,687.70	73,675.38	36,200.22
Profit before Interest, Depreciation, Tax and extra-ordinary items	23,650.50	12,047.69	6,595.92	6,773.23
Extraordinary Items	(102.39)	9.80	(108.11)	118.46
Profit before Interest, Depreciation and Tax	23,548.11	12,057.49	6,487.81	6,891.69
Interest & Finance Charges	(8,344.19)	(2,682.36)	(3,486.25)	(1,699.20)
Depreciation	(15,683.18)	(4,477.46)	(4,531.79)	(2,083.80)
Profit/(Loss) before Tax	(479.26)	4,897.67	(1,530.23)	3,108.69
Provision for taxation:
- Current Tax	(87.87)	(1,417.72)	-	(623.35)
- Less: MAT credit entitlement	-	1,417.72	-	623.35
- Net Current Tax	(87.87)	-	-	-
-MAT Credit entitlement of earlier years	(26.61)	-	-	-
- Income Tax for earlier years	0.40	-	-	-
- Deferred Tax	247.62	(578.68)	(39.15)	(40.13)
-Minority Interest	(74.15)	(28.07)	-	-
Net Profit after Tax (after minority)	(419.88)	4,290.92	(1,569.38)	3,068.55

- Consolidated loss before tax during the year 2013-14 was at H479.26 Lacs as against a profit of H4,897.67 Lacs in the year 2012-13. This was mainly on account of higher interest charge and depreciation during the year under review.

- Average net sales realization during the year under review has grown by 3% during the year under review as compared to previous year.

OPERATIONAL PERFORMANCE

FY 2013-14, although an year marked with inflation, slowdown in economy and flat demand growth of cement, has been an year of stabilization of operation for your company. Your company has been able to stabilize operation of its newly set up Grinding Unit at Guwahati which was commissioned during last quarter of Financial Year 2012-13. The operation of newly commissioned Clinker Manufacturing Unit of subsidiary M/s Star Cement Meghalaya Limited at Lumshnong (Meghalaya) also has largely been stabilized during the year under review.

FY 2013-14 was first full year of operation for both the newly commissioned units. However, amid the challenges posed by macro-economic conditions which prevailed throughout the year under review, your company has been able to stabilize its operation of its new units and has been able to manufacture 13,78,616 MT of Clinker on consolidated basis as against 835,576 MT during the FY 2012-13, registering a growth of 65% over last year.

Your company produced 16,64,037 MT of cement during the year under review on consolidated basis as against 10,67,465 MT during FY 2012-13 registering a growth of 56%. Cement dispatch on consolidated basis was 16,53,279 MT during the year under review as against 10,69,489 MT during FY 201213, registering a growth of 55% over previous year. Similarly, sale of cement grew from 10,65,097 MT on consolidated basis during last year to 16,31,048 MT during the FY 2013-14, registering a growth of 53%.

In the first full year of operation, both of the newly commissioned units have been able to achieve around two-third of its capacity utilization. Grinding unit at Guwahati produced 954,679 MT of cement during the year under review which accounts for 60% (approx.) of installed capacity. Similarly, the clinkerisation unit of subsidiary M/s. Star Cement Meghalaya Limited has achieved a capacity utilization of 63% and has manufactured 11,02,905 MT of Clinker during its first full year of operation. With more stabilized operation, your company expects larger volumes of clinker and cement production from next financial year onward.

DIVIDEND

Your Company has declared and paid an interim dividend at the rate of 25% (RS,2.50 per equity share of RS,10/- each) during the month of January, 2014. Total outgo on account of dividend for the year under review amounts to RS,1,226.15 Lacs including dividend distribution tax of RS,178.11 Lacs.

To meet the operational requirement of funds, your directors do not recommend any further dividend for the year under review.

MARKET DEVELOPMENTS

With commissioning of new units, your company has been able to capitalize on potential of markets of North Eastern Region (NER). Despite flat demand growth in the markets of North East, your company has been able to grow its sales volume by 37% in the region. Your Company sold 14,16,426 MT of cement on consolidated basis in the markets of NER during the year under review as against 10,32,839 MT during the last financial year. The market share of your company further improved from 18% during last financial year to 23% during the year under review. This has been achieved by concentrating on more focused approach to expand its reach in rural and semi-urban market of NER. This was further supported by increased brand visibility and focused campaigning of your brand "STAR CEMENTâ in remotest areas of the region. Company''s Brand "STAR CEMENTâ continues to enjoy leadership position in the region.

Apart from intensifying its effort in NER market, your company is pleased to inform that product of your company under the same brand "STAR CEMENTâ has successfully been placed in the markets of West Bengal and Bihar. Keeping in view the short time frame since your company launched its product in these market, the efforts put in the markets of West Bengal & Bihar have started bearing fruits for the company. Your company has been able to cloak a sales volume of 2,14,622 MT of Cement in a very short span of time in these markets during the year under review as compared to 32,258 MT during the immediate preceding financial year which accounts for more than five times growth during the year under review over previous year.

While in NER, the dealer and retail network has been under expansion during the year under review to further consolidate its feet in the region; your company has started appointing dealer and retailers in the markets of West Bengal & Bihar too. A dedicated team has already been placed for these new and upcoming market areas to strengthen its retail network. A huge marketing and visibility campaign has been put in place to have a better brand visibility and top of mind recall amongst the users of cement in all these markets.

With sustained marketing efforts on continued basis, your company expects to put a much better performance during the ensuing year. In addition, your company is also exploring possibility of placing its product in the markets of neighboring countries viz. Nepal, Bhutan and Bangladesh. Your company, through its subsidiary M/s Star Cement Meghalaya Limited is already exporting clinker to these neighboring countries. Your company is exploring avenues to export cement too in these markets.

PRODUCTION AND COSTS DEVELOPMENTS

Your company has undertaken cost reduction measures as major thrust area during the year under review. We could achieve reduction of input cost on almost all major raw materials with only exception being packing materials which rose due to rise in global crude prices.

We have successfully implemented "Online Reverse Auctionâ of major purchased items achieving considerable reduction on cost. Inventory reduction drive was taken up as a measure focus area in order to liquidate redundant and dead stock items of Stores and Spares.

Cost of Lime Stone and Shale largely remained unchanged. Cost increase on explosives was offset by better utilization factor of same.

Coal

Coal being a major cost driver for cement industry has got a very important role in overall cost composition of cement produced. Purchase price of Coal reduced considerably to H3442/- PMT during the year under review as against H4,872/- PMT during previous year. However, Coal consumption has also reduced from 17.69% of Clinker manufactured during last financial year to 17.11% during the year under review. This was achieved on account of better quality of coal received. However, specific heat consumption has gone up marginally from 788 Kcal/Kg of Clinker during the last financial year to 806 Kcal/Kg of Clinker during the year under review.

Fly Ash

Cement blended with Fly Ash has got dual advantage. On the one side, usage of fly ash is friendly to environment and on the other hand, it results into achieving cost optimization and energy saving. Your Company has been able to source fly ash from multiple sources which has given an edge in terms of optimization of blending and cost both. Your company has made long term arrangements with major power plants of NTPC, Tata Power and WBPDCL. In addition, your company has also made arrangement with its subsidiary M/s Meghalaya Power Limited for supply of fly ash. This blend of source has not only given an advantage of less dependence on one source but has also resulted into advantage on cost front. Usage of fly ash of subsidiary company has not only reduced average landed cost but also dependence on availability of railway rakes and uncertainty related thereto has reduced to a great extent. During the year under review, your company has produced 14,75,331 MT of fly ash based Portland Pozzolana Cement (PPC) as against 9,71,098 MT during immediate previous year.

Logistics & Freight

During the year under review, Logistical needs of the organization increased many fold with commissioning of Guwahati Grinding Unit and Clinkerisation unit of subsidiary M/s Star Cement Meghalaya Limited. The expansion of market to areas outside the North East Region also warranted a mix of Road and Rail movement. While additional capacity was to be distributed in the market, we were subjected to inter unit dispatches of Clinker and increased needs of input and raw materials. Your company braved all challenges and prudent planning put in place ensured smooth availability of trucks and wagons.

During the year under review Freight Cost reduced to RS,1322 per MT as against RS,1362 per MT during previous year. This was achieved despite increase in cost of Diesel by 14% in addition to increase in other input costs for transportation industry. With increased capacities, distribution network was developed in West Bengal and Bihar with 24 Warehouses across these two states. Cost effective Railway mode of Transportation was used to a big extent with dispatch of 1.91 Lakh MT by Rail to Bengal & Bihar. Clinker Export to Bangladesh was started during the year by both River Barges and Road Transport.

Your company continued to focus on Infrastructure development and in the process construction of a Railway Siding was initiated which is expected to be commissioned in the ensuing financial year. Company has tied-up arrangement to ensure availability of over 400 trucks to work dedicatedly for its transportation needs. Warehouse and Logistics Infrastructure development was also undertaken for Export of Clinker to neighboring countries.

Power Cost

With commissioning of Clinkerisation unit of its subsidiary M/s Star Cement Meghalaya Limited at Lumshnong and Company''s Grinding Unit at Guwahati, on consolidated basis total requirement of power has gone up considerably during the year under review. Moreover, in the ensuing year and onward with expected improvement in capacity utilization of all the plants including of subsidiaries, the power requirement on consolidated basis is set to grow. The availability of grid power remained a concern both in terms of quality and quantity during the year under review coupled with increase in tariff and minimum demand charges. Keeping this into mind, as also the status of availability of Grid Power from State Electricity Boards, your company has advanced its efforts to towards reducing its dependence for supply of power on State Electricity Boards. Your company has made long term arrangement for supply of power with its subsidiary M/s Meghalaya Power Limited which has already started its commercial operation with expanded capacity of 51 MW. In addition, Grinding Unit at Guwahati has also been granted permission to purchase power through Indian Energy Exchange (IEX) under Open Access Mode. Although the power cost has gone up from RS,5.72 Per Kwh during the FY 2012-13 to RS,6.47 Per Kwh during the year under review but on account of reduced dependency for power on State Electricity Board, plant operation remained unaffected. However, increase in cost of power has impacted margins of the Company.

INDIAN CEMENT INDUSTRY - GROWTH PERSPECTIVE AND OUTLOOK

Despite slowdown in nation''s economy in recent years, as a developing and emerging economy, India still have great potential in infrastructure sector and cement plays a critical role in the growth and development of the country. As a country, our nation is placed second in terms of production of cement in the world. The cement industry has been expanding on the back of increasing infrastructure activities and demand from housing sector over the past many years. Although there has been flat growth in cement demand during the year 2013-14, on the expectation of increased government spending in infrastructure sector a growth of 5-6 per cent is expected during next fiscal. This is also supported by an expected increase in demand from the rural sector and tier II and tier III cities. Cement production in India is expected to touch 400 million tonnes (MT) by 2020. In next few years Cement consumption in India is expected to rise by 8 to 9 per cent on a year to year basis and industry is expected to regain its momentum and witness a steady market.

As a nation, our country has the potential of becoming world''s third largest construction hub in next 8 to 10 years. Apart from infrastructure sector, a major consumption segment of cement in India has been housing sector. Government has also been focused on promotion of low-cost affordable housing. Expected leap in infrastructure and housing sector to boost economic growth and with a plan to increase investment in infrastructure sector to US $ 1 trillion in the 12th Five Year Plan (2012-17), the industry is expected to add a sizable capacity.

On the capacity utilization front, in the short to medium term, the industry is expected to operate at a level of 70 to 80 percent of its capacity. However, in the longer term the industry looks promising after a prolonged muted growth years.

On the cost front Coal, Power and freight cost are the major cost drivers for the cement industry. Although prices of coal has stabilized in North Eastern Region with a bias towards reduction, prices and quality of coal in rest of country still poses challenges for the cement industry. Stringent environment and forest regulations are other major challenges affecting availability of coal in general and other critical minerals like limestone in particular for cement industry which may ultimately lead to higher mining and procurement cost. To overcome this situation, many of cement plants have started importing coal from countries like Australia and Indonesia and are also exploring possibility of using alternate fuel. Fluctuating Rupee with bias towards depreciation in its value through the year under review has taken a toll on the prices of diesel too leading to increase in freight cost. Railways have been increasing its freight rates from time to time. Timely availability of railway rakes has been another bottleneck.

On the power front, availability of grid power both in terms of quality and quantity has remained a concern for cement industry. Poor availability of coal to power plants has resulted into lower capacity utilization and reduced output. Recent developments on allocation of coal blocks and consequential halt on its allocation to coal consuming industries has also affected power generating units across country. On the tariff front, state owned electricity supplying companies have been increasing their tariff and minimum demand charges and despite that they have not been able to meet their Actual Revenue Requirement (ARR).

However, on the back of expected growth in country''s economy,

India presents a better and promising future ahead for cement industry.

CEMENT SCENERIO IN NORTHEAST - A VIEW IN RETROSPECT AND OUTLOOK

Still with potential of huge investment in infrastructure and housing sector in North Eastern Region, the muted and flat growth in cement demand during the year under review has not left the region untouched. The demand growth was close to 4% in the North Eastern Region during the year under review. This was mainly on account of slowdown in spending in infrastructure sector and increased lending rates in housing sector. Overall inflationary conditions also resulted into lowering down the resources at disposal of consumers at large, thereby decreasing their spending capacity. Increasing costs of construction coupled with depressed resources and uneasy access to funds from financial institutions have resulted in a slowdown in demand for cement from the housing as well as infrastructure sector in the North Eastern Region too. Restrained expenditure in current Infrastructure projects by the Government and drying up of fund allocation for new projects has resulted in the sector stagnating which resulted into flat demand for cement in the sector.

North Eastern Region (NER) even though being rich in mineral resources, lacks in various indicators of development as compared to rest of India. Off-late, the Central Government has renewed its endeavor of providing fillip to the development of infrastructure in the region by constituting a monitoring committee, comprising of representatives from North Eastern States to improve the region''s coordination with the Central Government on development of infrastructure in the region. Several ambitious road development projects like Trans Arunachal Highway Programme and special accelerated road development projects have since been cleared by the Central Government and bottlenecks in implementation of these projects have since been removed. Though, there has been a sedate growth in demand for cement during the year under review, on the back of several ambitious infrastructure projects lined up for implementation in the region, the demand for Cement is expected to firm up. Moreover, with the economy expected to pick up in the short term and with rise in sentiments, the major consumption areas like housing, road and rail will drive the demand of cement further in the region.

Although, market share of cement imported from outside the region has reduced over the years, still a significant quantity is still being pushed in the markets of North East from the cement players from outside the region. This provides another opportunity to cement industries of North Eastern Region to further consolidate on their market share. In terms of volume, your company has been able to achieve sale of 14,16,426 MT of Cement in the region during the year under review as against 10,32,839 MT during the previous year registering a growth of 37% as against growth of 4% in Cement demand. Market share of your company has increased to 23% as against 18% during the previous financial year in the region. Your Company continues to enjoy brand leadership position in the market of North East. With the stabilization of operations of its newly commissioned units, your Company expects to further strengthen its feet in the Region.

SUBSIDIARIES COMPANIES

Operations of M/s Star Cement Meghalaya Limited, subsidiary of your Company which commenced commercial production of Cement Clinker during last quarter of FY 2012-13 have largely been stabilized.

M/s Meghalaya Power Limited, Lumshnong which expanded its capacity during FY 2012-13 is under process of stabilization of its operations.

M/s Star Cement Meghalaya Limited, M/s Meghalaya Power Limited, M/s Megha Technical & Engineers Private Limited and M/s NE Hills Hydro Limited continue to remain subsidiaries of your company.

The statement pursuant to Section 212 of the Companies Act, 1956 relating to subsidiaries is annexed to this report. The Board of Directors has given their consent for not attaching the financial statements of the subsidiaries referred to in the aforesaid annexed statement, pursuant to General Circular No. 2/2011 dated 8^th February, 2011 of the Ministry of Corporate Affairs, Government of India. However, the annual account of Subsidiary Companies and the related detailed information shall be made available to the shareholders of the company and that of subsidiaries seeking such information at any point of time. The annual accounts of subsidiaries are also available for inspection by any share holder at the corporate office of the company and that of its'' subsidiary.

CONSOLIDATED FINANCIAL STATEMENTS

Your Company has also prepared the Consolidated Financial Statement in accordance with Accounting Standards 21 issued by the Institute of Chartered Accountant of India, which comprises of the financial statement of the Company and the subsidiaries Megha Technical & Engineers Private Limited, Star Cement Meghalaya Limited, Meghalaya Power Limited, and NE Hills Hydro Limited. The audited consolidated financial statements together with Auditors'' Report form part of the Annual Report.

The consolidated net Loss of the Company and its subsidiaries stood at RS,421.39 Lacs for the financial year ended on 31^st March, 2014 as compared to RS,1,569.38 Lacs for the Company on a standalone basis.

HOLDING COMPANY

The Scheme of Arrangement between holding company Century Plyboards (India) Limited and Star Ferro and Cement Limited and their respective shareholders to transfer the Ferro Alloys and Cement Businesses of holding company to Star Ferro and Cement Limited which was pending for approval by Hon''ble High Court of Calcutta was approved on 17^th May, 2013. Consequent to approval, M/s Century Plyboards (India) Limited has ceased to be the holding company of your company with effect from appointed date, i.e. 1^st April, 2012 and M/s Star Ferro and Cement Limited has become holding company of your company effective from the same date.

M/s Star Ferro & Cement Limited holds 70.48% of equity in your company.

As informed by holding company, demerger will enable the holding company to carry out its core business of Plyboards and laminates more conveniently and advantageously on the one side, and such demerger and transfer will also unlock the potential of each of the businesses to raise and access larger funds for running, growth and expansion thereof on the basis of their individual strength and operating parameters and independent valuation, on the other side.

INTERNAL CONTROL SYSTEMS

The Company has adequate level of internal control system in place commensurate with size and nature of its business. Regular Internal Audits are conducted by an external firm of Chartered Accountants for all the major processes which ensures reliability of transactions being recorded which in turn ensures reliability of financial reporting, timely feedback on operational efficiencies, compliances of processes, policies, laws and regulations which have a bearing on the business and sustenance of your company.

The Internal Audit function reviews the efficacy of internal control system in place from time to time to ensure that company''s business and operations remain protected under changing business environment and needs as also with frequent changes in legal and regulatory framework governing the business and operations of your company.

The Internal Audit and internal control systems have also been designed in the manner that it provides early signal of any lapse or loss of control in the control mechanism affecting operations in any manner.

The report of internal auditors is periodically reviewed by Audit Committee. The Audit Committee reviews the effectiveness of the internal controls and checks in place for processes and the risk management mechanism employed by the Company and suggests, changes, as and when required.

PARTICULARS OF EMPLOYEES

The Company has no employee whose salary exceeds the limit prescribed under section 217(2A) of the Companies Act, 1956. Hence, information required to be given under the said section read with Companies (Particular of Employees) Rules, 1975 as amended has not been provided in this report.

HUMAN RESOURCE AND INDUSTRIAL RELATIONS

Human Capital has always been critical and one of most important and most valuable element for any organization. Employees with high moral and engagement deliver unexpected benefits to the organization. To keep the morale high, besides adopting standard HR management processes, your company has created a favorable work environment that encourages innovation and meritocracy by aligning the growth of individual talent with Organizational objectives to meet the strategic needs of the organization as also ensures fulfillment of individual and team aspirations. The Organizational Objectives cascaded to Department, Team and Individuals as their targets are reviewed periodically.

Continuous learning of employees has remained of prime significance for your company. We believe that this is necessary not only for company''s own sustainability and growth as an organization; but also for enabling professional development of employees. Leadership development at every level is core part of our In-house, external and internal training programme in addition to build & develop required competencies on functional and behavioral aspects as well. For contractual employees, your company has also started a systematic training programme before and after they are engaged at work.

Mentoring local employees to inculcate industrial work culture amongst them is our continuous effort and delivering desired results.

Your Company strives towards attracting best possible talent through employee referrals, open market and campus recruitment. This provides a blend of ideas & knowledge at work place.

To maintain the work life balance, social gatherings and competitions are organized across the organization and various festivals are celebrated with active participation of employees and their family members.

Your Company continues to enjoy a good and harmonious Industrial relation and congenial environment across the organization.

OCCUPATIONAL HEALTH AND SAFETY

Safety has always been a top priority area for your company. Your Company has been focusing not only on creating safe environment to work at work place, but has also been endeavoring to build a mindset amongst its employees and stake holders which is one of the most essential input for creating safe working environment at work place and outside too. If one carries out a root cause analysis of any accident or near-miss, the instances where the accident has occurred on account of avoidable human errors will be observed the most. This happens mostly on account of ignorance or tendency to ignore prescribed safety norms to be adopted during execution in a particular kind of job either at work place or even otherwise. To avoid such instances, your company has been consistently conducting awareness programme involving all employees and other stake holders across the organization in form of regular EHS Gate Meetings, Safety Drills, quiz Competition. During the year under review, to create awareness on Fire Safety, a fire safety day was observed wherein mock drills were conducted and demonstrated to share the knowledge about actions to be taken in the eventuality of any fire. A monthly Gate Meeting on environment health and safety is arranged wherein participation is ensured across all levels and departments and incidents are discussed and analysis is carried out to create awareness amongst the participants to avoid repetition of such incidents. Periodical and surprise safety audits are carried out to check the level of prescribed safety norms being followed during execution of different works. A behavioral based safety audit was also conducted during the year under review by an external agency amongst managerial employees. An emergency control room has been put in place to attend any eventuality. Your company has also started a safety induction programme for all new employees and contractual workers.

As a measure towards environment protection and to make its campus the greenest, your company has adopted "Akira Miyawakiâ, a method which aims at planting a dense forest instead of planting a tree. Company at its unit has planted 2700 saplings of 14 native species on a single day on 20.09.2013.

DIRECTORS

Mr. Brij Bhushan Agarwal and Mr. Pankaj Kejriwal will retire by rotation at the forthcoming Annual General Meeting in accordance with the provisions of the Companies Act, 1956 and Company''s Articles of Association and being eligible, offer themselves for reappointment.

The Board recommends their reappointment.

DIRECTOR''S RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 as amended, the Board of Directors hereby confirms:

1. That in the preparation of Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

2. That the Director''s have selected appropriate accounting policies and have applied them consistently and have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2014 and of the Statement of Profit & Loss and Cash Flow of the Company for year ended 31^st March, 2014.

3. That the Directors have taken proper and sufficient care 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.

4. That the Directors have prepared the annual accounts on going concern basis.

CORPORATE CITIZENSHIP

Your Company believes in principal of inclusive growth and considers the growth of community along with the growth of the Company as an important aspect of business ethics. With an aim of giving back to the society, the Company, as a responsible corporate citizen, has been proactively undertaking social welfare activities for the benefit of local people and all around development of local area.

Your Company maintains a school, equipped with modern educational facilities, for providing better educational facilities at the local area at Lumshnong Village. The School is affiliated to Central Board of Secondary Education and imparts education up to 10th Standard and is staffed with well-trained teaching and non-teaching staff. Plans have been put in place to upgrade the school to 12th Standard of education in the coming years. During the year under review, your company has actively contributed in construction of new school building and classes have started from the newly constructed building. The school provides free-ships to poor and needy students of local and surrounding villages.

The Company has been actively participating in social and economic development of the local village and the surrounding areas and has been one of the key contributors to the Village Area Development Fund. During the year under review, your Company has started several skill development programs for the youth of the area. With a view to increase the means of livelihood for local people and for uplifting their social status and with a view to encourage local entrepreneurship, your Company has been engaging local people as suppliers of limestone, coal, river sand etc. The Company has continued to maintain street lights of the village. Potable drinking water has been made available to the people of the local village and adjoining areas through a dedicated fleet of tanks maintained by the Company.

The Company has also been actively involved on the health front and maintains a well-equipped hospital to take care of day to day medical, diagnostic and emergency requirements of local residents. The Company also maintains dedicated fleet of ambulances fitted with modern facilities and equipment to cater to all kind of medical emergencies round the clock. During the year under review, several free medical health check-ups, eye check-ups and vaccination camps were conducted by your Company. Doctor on call facility has also been put in place for the welfare of the local people.

To further strengthen its social responsibilities, your company has plans to put in place a committee dedicated towards monitoring and implementation of its responsibilities as a responsible corporate citizen.

AUDIT COMMITTEE

Your Company has an audit committee at the Board level, which acts as a link between the management, the statutory and internal auditors and the Board of Directors and oversees the financial reporting process. The Committee comprises of Mr. Sajjan Bhajanka, Mr. Brij Bhushan Agarwal and Mr. Prem Kumar Bhajanka with Mr. Sajjan Bhajanka as its Chairman. The Constitution of the Audit Committee also meets the requirements under section 292A of the Companies Act, 1956. Four meetings of the Committee were held during the year i.e. on 19^th April, 2013, 17^th July, 2013, 28^th October, 2013 and 8^th January, 2014.

The Audit Committee, inter-alia, reviews:

- Quarterly, half-yearly and yearly Financial Statements before submission to the Board for approvals.

- Significant related party transactions.

- Audit Reports including Internal Audit Reports and report of internal audit team of the Company.

- The Company''s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

- Recommendation to the Board, the appointment, reappointment of auditor, and fixation of audit fees.

- Changes, if any, in accounting policies and practices and reason for the same.

The Audit Committee so constituted advises the management on the areas where internal audit can be improved. The minutes of the meetings of the audit committee are placed before the Board.

AUDITORS'' REPORT

The observations made in the auditor''s note are self-explanatory and therefore do not call for any further comments under section 217 (3) of the Companies Act, 1956.

APPOINTMENT OF COST AUDITORS

Your Company has appointed M/s B.G. Chowdhury & Company, Cost Accountants to audit the Cost Records of the Company for the financial year ended on 31^st March, 2014 in terms of Section 233B of the Companies Act, 1956.

AUDITORS

M/s. Kailash B. Goel & Co., Chartered Accountants, Statutory Auditors of the Company, will retire at the conclusion of the ensuing Annual General Meeting of the Company. Being eligible, they have offered themselves for re-appointment and have confirmed that their appointment, if made, will be in accordance to the provisions of section 141 read with section 139 of the Companies Act, 2013. In terms of requirement of section 177 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, the audit committee of the company in their meeting dated 17^th May, 2014. have recommended their appointment as statutory auditors for the year 2014-15 to Board of Directors. Members are requested to approve and ratify the appointment. Members are also requested to empower the Board of Directors for fixation of Auditor''s Remuneration.

Term Plans, objectives, prospects and opportunities may be forward looking. Such Statements have been made on the basis of experience so far and are contingent upon various factors like legislative and regulatory developments, macro economic and political trends, domestic demand and supply conditions affecting selling prices, new capacity additions which are material to the business operation of the Company and actual performance may differ materially from those expressed in the said statements.

APPRECIATION

Your directors take this opportunity to express deep sense of gratitude to the banks, Central and State Governments and their departments, the local authorities and business associates for their continued guidance and support. We would also like to place on record our sincere appreciation for the total commitment, dedication and hard work put in by every member of the CMCL family. To them goes the credit for the company''s achievements. Your Company also wishes to convey its sincere thanks and appreciation to the villagers of Lumshnong village and other villages in Narpuh Elaka and also to the villagers of Chamta Pathar, Sonapur, Guwahati for their continuous and ever strengthening support. And to you our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.

FORWARD LOOKING STATEMENTS

In the Management Discussion and Analysis and Directors'' Report, statements given while describing Company''s Long

For and on behalf of the Board of Directors

Place : Kolkata Sajjan Bhajanka

Dated: 17^th May, 2014 Chairman and Managing Director

Mar 31, 2013

INDIAN ECONOMY AND REST OF GLOBE

Fiscal 2012-13, once again remained full of challenges on global economic front. European countries have been trying to come out of last fiscalâs Euro zone Crisis but monetary unionâs fundamental problem of low potential growth, ongoing recession, loss of competitiveness and large stocks of public and private debts are yet to be resolved. If we see beyond Euro zone, United Kingdom has been seen struggling to restore growth owing to the damage caused by front-loaded fiscal-consolidation efforts. Chinaâs economic model remains unstable. Japan is trying a new economic experiment to stop deflation, boost economic growth and restore business and consumer confidence. Middle East, which remains an arc of instability and Turkey faces many challenges of its own. Its bid to join the European Union is currently stalled, while euro zone recession dampens its growth. Its current-account deficit remains large. In backdrop of above, United States of America has experienced several positive economic trends. Job creation is improving, rising labour cost in Asia and the event of robotics and automation are underpinning a manufacturing resurgence. Aggressive quantitative easing is helping both the real economy and financial markets. But unemployment and household debt still remains stubbornly high. Amongst advanced economies, the United

Directorsâ Report

States of America is in the best economic shape followed by Japan. Euro zone and UK remain mired in recessions made worse by tight monetary and fiscal policies. Amongst emerging economies China could face a hard landing in years to come if critical structural reforms are further postponed.

India story has not remained untouched with what happened in rest of the globe. GDP growth of 5% is one of the lowest in last 10 years. The only contention has been that 5% GDP growth rate also is much higher than G-7 Countries. Inflation is at all time high. Indiaâs exports, which had surpassed pre-crisis levels within a year in 2010-11 with a record 40.50% growth, continued growing even in 2011-12, but were finally affected by the global slowdown in 2012-13 with exports declining even more at - 4.90% in the first ten months than the - 3.50% recorded during 2009-10. The decline in export growth is mainly on account of external factors and changes in exchange rates. Slowdown in the GDP growth of Partner Countries is also seen as a major factor in decline of export. Infrastructure and Industrial Projects did not perform up to the mark. Domestic savings and consumption were badly affected on account of high inflation and depreciating rupee. Structural bottlenecks, slow policy movement, stubborn interest rates on account of high inflation, declining exports, low non-food credit growth, declining industrial growth and subdued demand for both consumption and investment has led to the systematic decline in the overall economic growth of the country in FY 201213.

However, it is expected that economy will revive in the coming fiscal and GDP growth is expected to rise to 6% from 5%. The expectation would ride on the back of normal monsoon giving a good harvest to farmers, increase in investment with favorable interest regime and with gradual recovery in industrial production and exports. Economy looks at Government initiatives to start spending on capital projects which have been hitherto stalled on account of fiscal constraints. With increase in consumption demand and higher capital investments, industrial activity is expected to improve. Average Annual inflation is also likely to ease further during FY 2013-14. With improvements in growth prospects as well as continuation of FIIs inflow, investorsâ confidence and investment climate are set to receive a fillip.

INDIAN CEMENT INDUSTRY

Despite slowdown seen in global as well as Indian economic scenario during FY 2012 13, Indian Cement Industry fared well during the first half of the year under review. As against growth of 6% in Fiscal 2011-12, first half of calendar year 2012 witnessed growth of 10%. Poor monsoon affected harvest to a great extent but helped cement industry. Monsoon season which is normally considered a low season for cement industry on account of poor construction activities, lack of rain has allowed construction companies to continue working as usual and pushed up demand for cement. However, second half of the year witnessed drastic fall in cement demand on account of slowdown in construction industry. The growth achieved during first half was largely set-off by slowdown in demand during the second half of the year. Shortage of construction material like sand, bricks and water also affected pace of construction industry resulting into low demand of cement and lower capacity utilization by cement industry during second half.

On capacity front, Indian Cement Industry added more than 35 Million Tonnes during the year under review which accounts for 10% growth in the capacity over previous year. However, on account of sluggish demand during second half, capacity utilization remained low.

On cost front, Cement Industry witnessed challenges during the year under review. Freight, being one of the major cost drivers, has gone up considerably with an increase of more than 20% in railway freight. Series of hikes in the prices of diesel has led to considerable increase in cost of transportation of raw material and finished goods. Cost of coal was also north bound during the year under review.

KEY HIGHLIGHTS 2012-13

- Consolidated cement production was 10,67,465 MT during the year as against 11,03,800 MT during the previous financial year.

- Consolidated net sales was Rs, 59,497.13 Lacs during the year under review as compared to Rs, 56,495.95 Lacs during the financial year 2011-12.

- Consolidated EBIDTA was 20.25% lower at Rs, 12,047.69 Lacs.

- Consolidated profit before tax declined during the year 2012-13 to Rs, 4,897.67 Lacs as against Rs, 9,097.31 Lacs in the year2011-12.

- Consolidated profit after tax was lower at Rs, 4,290.92 Lacs in FY 2012-13 as against Rs, 8,982.47 Lacs in FY 2011-12.

- Average net sales realization has gone up by 15% over previous year.

Despite various challenges on the economic front and slowdown in cement demand during second half of FY 2012-13, your Company has been able to sustain its operation almost at last fiscalâs level. During the year under review, your company has produced 758,175 MT of Cement Clinker on standalone basis as against 714,780 MT during the last financial year on standalone basis, registering a growth of 6.07% over last year. During last quarter of FY 2012-13 new grinding unit of your Company at Guwahati and new Cement Clinker manufacturing unit of M/s. Star Cement Meghalaya Limited, subsidiary of your Company have also commenced their commercial operation and their operations are getting stabilized. On consolidated basis, your Company has been able to produce 835,576 MT of Cement Clinker register a growth of 16.90% over last year.

Your Company has produced 10,67,465 MT of cement during the year under review on consolidated basis as against 11,03,800 MT during last financial year, a drop of little over 3% over previous year. This has been mainly on account of the facts that unlike previous year, during the year under review, your Company has not made any substantial purchase of clinker from outside and has been able to sustain the level of cement production almost at the level of last year on the basis of its own clinker. During the year under review, your Company has been able to maintain almost same level of sales volume as during previous year and has sold 10,65,097 MT of Cement as against 11,06,422 MT during the previous year. The marginal drop of 4% approx is on account of lower production volume as mentioned above.

\| Particulars	CONSOLIDATED		STANDALONE
	2012-13	2011-12	2012-13	2011-12
Net Sales / Income	59,687.70	56,729.00	36,200.34	33,789.15
Profit Before Interest, Depreciation, Tax and Extra Ordinary Items	12,047.69	14,548.29	6,773.23	7,272.73
Extraordinary Items	9.80	(741.73)	118.46	(350.13)
Profit Before Interest, Depreciation and Tax	12,057.49	13,806.56	6,891.69	6,922.60
Interest & Finance Charges	(2,682.36)	(1,898.38)	(1,699.20)	(1,182.83)
Depreciation	(4,477.46)	(2,810.87)	(2,083.80)	(1,723.58)
Profit Before Tax	4,897.67	9,097.31	3,108.69	4,016.19
Provision For Taxation:
Current Tax	(1,417.72)	(1,900.04)	(623.35)	(830.40)
Less: MAT Credit entitlement	1,417.72	1,879.56	623.35	830.40
Net Current Tax	-	(20.49)	-	-
MAT credit entitlement of earlier years	-	(195.88)	-	-
Short Provision Of Income Tax	-	(83.21)	-	-
Deferred Tax	(578.68)	46.42	(40.13)	31.37
Minority Interest	(28.07)	138.32	-	-
Net Profit After Tax (After Minority)	4,290.92	8,982.47	3,068.55	4047.56

OPERATIONAL PERFORMANCE

DIVIDEND

In view of increased activities with commencing of new Grinding unit at Guwahati and new Cement Clinker unit by its subsidiary and with a view to conserve resources to meet operational requirement of funds, your directors do not recommend any dividend for the year under review.

MARKET DEVELOPMENTS

Despite intense competitive scenario which emerged in the markets of North Eastern

Region (NER) during the year under review, your Company has been able to sustain its operation in NER almost on the same level of previous year. On consolidated basis, your Company has sold 10,65,097 MT of Cement during the year under review as against 11,06,422 MT during last financial year. The marginal drop of less than 4% has been on account of lower production. Your Company has commenced commercial production of its grinding unit at Guwahati only towards end of the year under review and its full impact would be seen in the coming year. Companyâs Brand âSTAR CEMENTâ continues to enjoy its brand leadership position in the market of NER.

In its efforts towards further consolidating its base in the markets and remote areas of NER, your Company has further added 184 direct dealers and number of total dealer has gone up to 803 as against 619 during the previous financial year. During the year under review Company has added 792 retail counters.

With commencement of its new grinding unit at Guwahati, your Company has started to explore the neighboring markets in the States of Bihar & West Bengal and further, our product is expected to be launched in these two states, outside NER shortly.

PRODUCTION AND COSTS DEVELOPMENTS

During the year under review there has been all round increase on costs front. Cost parameters have undergone major changes during the FY2012-13. The FY2012-13was another year in sequence wherein the costs have increased in all areas of operations.

Coal

Coal being a major cost driver for cement industry has got a very important role in overall cost of cement produced. During the year under review, coal prices remained volatile through-out the year with a bias towards increase. Average Landed Cost per Ton of Coal went up from Rs, 4,081/- PMT during last financial year to Rs, 4,872/- PMT, which accounts for 19.38% increase over previous year. Increase in rate of Royalty further added to the woos. Royalty on Coal has increased from Rs, 290/- PMT to Rs, 675/-PMT. Coal consumption has also gone up from 17% during last financial year to 17.69% during the year under review on account of quality parameters. Specific Heat Consumption has also gone up marginally from 785 Kcal/Kg of Clinker during the last financial year to 788 Kcal/Kg of Clinker during the year under review.

FlyAsh

Blending of Fly Ash in manufacturing of Cement has got multiple inherent advantages. India as a country largely dependent on usage of fossil fuel coal for generation of power by thermal power plants which generates huge volume of fly ash. Despite intense efforts of Government to encourage use of fly ash in various products like bricks, pavers, cement etc., barring its usage in blended cement, fly ash has yet not found application in manufacturing of other products and disposal of surplus fly ash still remains a concern. Usage of fly ash in cement ensures not only better environment but also results into conservation of energy and higher output of Cement Grinding Mills resulting into optimization of overall cost of production of cement. Your company has been blending fly ash for production of cement since inception in its effort to extend a helping hand towards better environment and energy conservation. At the same time company has been able to optimize its operations by blending fly ash in production of cement as per BIS guidelines year after year.

Fly Ash being a waste product of thermal power plants is normally disposed-off by power generating companies either free of cost or at a very nominal price. Off take, most of power plants have started charging some price for fly ash, although some of the power plants not well placed logistically are even incentivizing lifting of fly ash. The only cost factor which matters in cost buildup of fly ash is its safe and secured handling, protecting environment and its transportation cost. Through optimizing source mix, your Company has been able to maintain the landed cost of fly ash during the year under review at the same level as of previous year. This has been achieved despite increase in cost of Rail and Road Transportation.

Power Cost

State Electricity Board supply has again remained a constraint during the year under view. There has been only marginal improvement in availability of grid power. During FY 2012-13 MeECL could supply only 42% of total power required asagainst38% during the previous financial year on consolidated basis. Much awaited Myntdu-Leshka project which was commissioned fully in 2012-13 is yet to stabilize its operation towards achieving full efficiencies and has not helped in improvement in power supply position in the State. Your Company has sustained its operation by sourcing its power from the power generation unit of its subsidiary, M/s. Meghalaya Power Limited and with the help of standby Diesel Generating Sets reducing Companyâs dependency on grid power. The dependency of Company is likely to further reduce on grid power in coming years.

MeECL increased power tariff just before the beginning of the financial year under review from Rs, 3.61 per KVAH to Rs, 4.10 per KVAH with effect from February 2012 and the same has remained unchanged thereafter. Cost of power from subsidiary of the Company has also gone up on account of higher generation cost as a result of increase in landed cost of coal.

Logistics & Freight

Logistics in North Eastern has always been a challenge. With infrastructure development and implementation of various innovative cost control measures undertaken, your Company has been able to ensure distribution of its product to end users and channel partners in more cost effective manner.

Despite increase in cost of diesel and railway freight, your Company has been able to reduce freight cost from Rs, 1,562/-PMT to Rs, 1,362/- PMT, a decrease of 13% over previous year. Such efficiency could be brought in by implementing a better destination mix for marketing of its product which also helped in bringing improvement in realization per ton of Cement. In order to support the marketing efforts in new areas, such as Bihar and West Bengal, your Company is expanding its logistical reach by tieing up with various logistics & freight service providers and opening up stock points in these states.

INDIAN CEMENT INDUSTRY - GROWTH PERSPECTIVE AND OUTLOOK

India being a fast developing country and Cement being one of the core industry plays a vital role in the growth and development of a nation. Indian Cement Industry occupies an important place in the Indian economy. Indian Cement Industry has transited itself into a more advanced industry, keeping in line with the technological world and is currently positioned second globally. This has offered advantages to the Industry. There are 139 large cement plants and over 365 mini cement plants in India, with currently more than 40 players in the industry.

Rapid development in real estate, construction and infrastructure sector coupled with the ever increasing industrial activities, in addition to the onset of various Special Economic Zones (SEZs) being developed across the country, there is a huge demand for cement. The industry is not only meeting the requirements arising within the domestic market but also fulfilling the burgeoning demands of the international arena. India is also exporting good amount of cement clinker and by products of cement. The cement sector has also attracted foreign direct investments.

In the backdrop of above, the growth momentum in Indian Cement Industry is likely to continue in years to come. The Cement Industry of India is expected to add 30-40 million tonnes perineum (MTPA) of capacity. The industry has a current capacity of 360 MTPA and operates at 7580% capacity utilization. It is anticipated that the cement industry will continue to increase its annual cement output in coming years. India would require overall cement capacity of around 480 MT. The industry will have to add another 120 MT of capacity during the period, according to the latest report from the working group on the industry for the 12th Five Year Plan (2012-17).

The Indian construction industry has shown significant development over the years with eminent and efficient engineers at the helm and is among the best in the world. The private sector is expected to contribute a major role into total projected spend on roads and highways over the Twelfth Five Year Plan (2012-17) period.

On the cost front, Coal, Power and transportation cost has always remained a concern for the industry. Ever increasing trend of Coal price during last few years has been posing challenges to Indian Cement Industry. Power being a major input has also been a bottleneck due to its intermittent supply coupled with poor quality of supply and transmission infrastructure. Increase in prices of coal has also impacted the cost of generation of power. Recent hike in railway freight and most recent government decision to deregulate diesel prices for bulk consumers and gradual increase in retail diesel prices will have large impact in increasing cost of transportation of raw material and finished goods in coming years.

Despite all above, Indian Cement Industry presents a better future ahead on the back of growing consumption demand in housing and infrastructure sector. Government of India has initiated several measures to boost housing and infrastructure sector. Lower growth in GDP during the year under review presents still better opportunities of all round growth which will further help to the industry. Road Sector is also now coming out as an area where application of cement is expected to grow year after year. On the back of these growth prospects, we visualize a bright future ahead for Indian cement industry in general and for your company in particular.

CEMENT SCENERIO IN NORTHEAST - A PROMISING FUTUREAHEAD

Indiaâs North Eastern Region is still far behind as far as connectivity by Rail and Road is concerned as compared to other states of our country. However, NER being rich with natural resources has not been able to catch up with the pace of development which has taken place in rest of India. Important parameters like Per Capita Gross State Domestic Product (GSDP), Per Capita Electricity Consumption, Per Capita income of NER as compared to rest of India also suggests that a lot of efforts are still required to be put for the socioeconomic development of the region. Keeping this wide gap into consideration, the Central Government, in the recent past, has been focusing on the development of NER and budgetary allocation for development of the region has seen increasing trend year after year.

During the year under review, there has been modest increase in Cement Demand in NER. However, we firmly believe that the demand of cement will again surpass the growth compared to national demand in coming years as many infrastructure projects have now started in real term. The Assam - Manipur Rail link work is in full swing. Hydel Power Projects of Central Government as well as Private Sector are also coming up as per plan. Major consumption area like housing, road, airport and rail will further drive the demand for cement in NER.

The demand supply gap of cement in NER shall reduce with the capacity expansion by your Company. The one-third of its total demand was being catered by import of cement from other States like Chhattisgarh, Madhya Pradesh and West Bengal but same is now expected to reduce due to increased availability within the region. The major benefit of demand is expected to come to your Company due to its strong presence in entire North Eastern Region.

SUBSIDIARY COMPANIES

M/s. Star Cement Meghalaya Limited, subsidiary of your Company has commenced commercial production of its Cement Clinker unit w.e.f. 30th January, 2013.

M/s. Meghalaya Power Limited, Lumshnong has also increased its production capacity during year under review.

M/s. Star Cement Meghalaya Limited, M/s. Meghalaya Power Limited, M/s. Megha Technical & Engineers Private Limited and M/s. NE Hills Hydro (P) Limited continue to remain subsidiaries of your Company.

The statement pursuant to Section 212 of the Companies Act, 1956 relating to subsidiaries is annexed to this report. The Board of Directors has given its consent for not attaching the financial statements of the subsidiaries referred to in the aforesaid annexed statement, pursuant to general circular no. 2/2011 dated 8th February, 2011 of the Ministry of Corporate Affairs, Government of India. However, the annual account of Subsidiary Companies and the related detailed information shall be made available to the shareholders of the Company and that of subsidiaries seeking such information at any point of time. The annual accounts of subsidiaries are also available for inspection by any share holder at the corporate office of the company and that of its âsubsidiary.

CONSOLIDATED FINANCIAL STATEMENTS

Your Company has also prepared the Consolidated Financial Statement in accordance with Accounting Standard - 21 issued by The Institute of Chartered Accountant of India, which comprises of the financial statement of the Company and its subsidiaries, Megha Technical & Engineers Private Limited, Star Cement Meghalaya Limited, Meghalaya Power Limited and NE Hills Hydro Private Limited. The audited consolidated financial statements together with Auditorsâ Report form part of the Annual Report.

The consolidated net profit of the Company and its subsidiaries amounted to Rs, 4,290.92 Lacs for the financial year ended on 31st March, 2013 as compared to Rs, 8,982.47 Lacs for the Company on a standalone basis.

NEW PROJECTS

The project of 1.60 MTPA cement grinding unit at Sonapur, Guwahati in Assam has commenced its commercial operation w.e.f. 31stJanuary, 2013.

The project of 1.75 MTPA Clinkerisation unit of its subsidiary M/s. Star Cement Meghalaya Limited has commenced its commercial operation with effect from 30th January, 2013.

M/s. Meghalaya Power Limited, subsidiary of your Company has increased production capacity of its 51 MW power plant during the year under review.

HOLDING COMPANY

Century Plyboards (India) Ltd (CPIL) remains the Holding Company of your Company, with a stake of 70.48% in your Company.

In compliance of order passed by Honâble High Court at Calcutta, M/s. Century Plyboards (India) Limited, holding company of your Company, convened an Extraordinary General Meeting of its shareholders on 13th February, 2013 at Kolkata for the purpose of considering and if thought fit, approving, with or without modification, the Scheme of Arrangement between the holding company Century Plyboards (India) Limited and Star Ferro and Cement Limited and their respective shareholders to transfer the Ferro Alloys and Cement Businesses of holding company to Star Ferro and Cement Limited. As informed by the holding company, demerger of Ferro and Cement business will enable the holding company to carry out its core business of Ply boards and laminates more conveniently and advantageously on the one side, and such demerger will also unlock the potential of each of the businesses to raise and access larger funds for running, growth and expansion thereof on the basis of their individual strength and operating parameters and independent valuation, on the other side.

As informed, Scheme of Arrangement stands approved in the above said meeting of the shareholders of the holding company. Once the scheme is approved by the Honâble High Court of Calcutta, the same would get effective retrospectively from 1st April, 2012 and your Company will become subsidiary of Star Ferro and Cement Limited.

INTERNAL CONTROL SYSTEMS

Your Company has in place adequate level of internal control system commensurate with size and nature of its business. Internal Audits are conducted on regular basis by an external firm of Chartered Accountants in different areas of operations depending on its size, criticality to business and risk potential.

Internal Control Systems have been designed and put to use in such a manner that all operational and related activities are performed efficiently and effectively. Significant financial information that is relevant is accurate and reliable and is provided in a time bound manner. The system in place ensures that resources are acquired economically, used efficiently and safeguarded adequately. It also ensures that employeesâ actions are in accordance with policy framework of the Company and in conformity of statutory provisions applicable from time to time. Opportunities identified during audits and reviews of control systems are discussed and if found effective are implemented.

The internal control systems are periodically reviewed by audit committee and suggestions on its adequacy and effectiveness for further improvements are adopted.

PARTICULARS OF EMPLOYEES

The information required under Section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 as amended, in respect of the employees of the Company is provided in the Annexure II forming part of this Report.

HUMAN RESOURCE AND INDUSTRIAL RELATIONS

Human Resource Development is a vital area for Company because ideas for innovation, quality and continuous improvement, as well as other critically important inputs needed to compete in the modern, highly competitive business world, come from people and not from machines. The need to develop human resources on an ongoing basis has always been an area of priority for your Company. The need for both the Company and employee to understand the role of human resource development has been a focus area all around.

Our Human Resource Policy favours developing internal talent to meet strategic needs of business. To reinforce this goal, your Company added Graduate Engineers & Diploma Engineers to the talent pool during the year under review and have the mentoring system in place for grooming local fresherâs, which aligns the various people management processes, respecting and valuing the core belief of Company which is composed of Vision, Values, Aspirations, Management Beliefs and Principles of Sustainability of the community around us.

Mentoring local employees is an initiative taken up for inducing Industrial culture among the local youths employed in your Company. All efforts are being put to bring them to industrial mainstream.

Policies are being reviewed from time to time to make them more employee friendly and recently new policy with regard to Benevolent Fund was introduced to meet the emergency needs of employees in case of hospitalization, untimely death and unforeseen accidents.

Social gatherings are being organized in the Club for creating a forum wherein employees and their family members can interact with higher officials for sharing of ideas and addressing their issues which shows transparency in the system. The Company have organized such gatherings on the occasion of Holi, Diwali, Navratri Puja, New Year function and Advance Christmas.

Behavioral training programs in the area of Discipline at Work, Time Management, Problem Solving, Communication, Safety Health & Hygiene and Leadership were conducted with internal faculties for bringing behavioral changes amongst employees.

OCCUPATIONAL HEALTH AND SAFETY

Occupational Health and Safety is a cross-disciplinary area concerned with protecting the safety, health and welfare of employee and workmen engaged in manufacturing environment. The goals of occupational safety and health programs include to foster a safe and healthy work environment. It also protects co-workers, family members, employers, customers, and many others who might be affected by the workplace environment.

Occupational safety and health can be important for moral, legal, and financial reasons. Company understands its duty of care to ensure that employees and any other person who may be affected remain safe at all times. Measures undertaken towards Occupational Health and Safety also reduce employee injury and illness related costs, including medical care, sick leave and disability benefit costs. OSH may involve interactions among many subject areas, including occupational medicine, occupational hygiene, public health, safety engineering, industrial engineering, chemistry, health physics, ergonomics and occupational health psychology. Towards achieving these goals and objectives, your Company has initiated various initiatives on sustained basis year after year to ensure that an effective Health and Management System is always in place around the work place and is more focused towards employees and workmen, apart from other persons who have potential of getting affected. Recognizing human error being root cause of large number of accidents and near-misses, negligence and ignoring the Standard Operating Procedures, your Company has been proactively imparting trainings and focusing on need of inculcating the habit of working securely at work place as also outside amongst employees, workmen and other potential impact group.

In its efforts towards the same, your Company has celebrated 42nd National Safety Week from 26th February to 4th March 2013 to generate, develop and sustain a voluntary movement on HSE at the National Level aimed at educating and influencing society to adopt appropriate policies, practices and procedures that prevent and mitigate human suffering and economic loss arising from all types of accidents. Different kinds of competitions ware arranged to create awareness among our employees towards Industrial Safety and occupational Health like Safety Poster Making Competition, Safety Slogan Writing competition, Safety Drawing competition, Safety Quiz competition, Best Safety Conscious Workmen Award, Best Safety Suggestion Award, Safety Debate Competition and Best House Keeping Award.

Your Company won the Silver Award in the category of Large Business Organization in 11th Greentech Safety Award 2012 from Greentech Foundation, New Delhi for outstanding achievement in Safety Management.

World Environment Day was celebrated on 5th June, 2012 to mark the importance of diverse life forms for the well being of humanity. During the FY2012-13, a âGreen Beltâ has been developed in and around the plant and colony. Company also received ICC Environment Excellence Award-2012 in Silver Category of Large Business Organization from Indian Chamber of Commerce, Kolkata.

Fire Service Day was celebrated on 14^th April 2012. One day in-house training programme was conducted on âUsing of Fire Extinguishersâ and âfire fighting demonstrationâ was also conducted. Safety awareness programme was organized on 11th July 2012 with collaboration of Inspectors of Boilers and Factories, Shillong.

Well equipped Emergency control room is available to attend any type of disaster/emergency. Periodically mock drills are conducted to attend any time of emergency.

Systems and Processes of OHSAS - 18001 were complied continuously during the year under review too.

DIRECTORS

Mr. Prem Kumar Bhajanka, Mr. Mangi Lal Jain and Mrs. Clara Suja, directors of the Company, retire by rotation at the forthcoming Annual General Meeting in accordance with the provisions of the Companies Act, 1956 and Companyâs Articles of Association and being eligible, offer themselves for re-appointment.

The Board recommends to the members for the re-appointment of retiring Directors.

DIRECTORâS RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 as amended, the Board of Directors hereby confirms :

1. That in the preparation of Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

2. That the Directorâs have selected appropriate accounting policies and have applied them consistently and have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the Statement of Profit & Loss and Cash Flow of the Company for year ended 31st March, 2013.

4. That the Directors have prepared the annual accounts ongoing concern basis.

CORPORATE CITIZENSHIP

Your Company has always been proactive in discharging its responsibilities towards well being of society as corporate citizen. Looking beyond the perspective of growth in shareholdersâ value, your Company, over a period, has developed a well designed social welfare activities for the benefit of local village and local people.

On education front, your company has completed construction of school building at Lumshnong having modern educational facilities in its efforts towards providing better education to children of villages in and around the factory, apart from education to children of its employees. School has now been affiliated with Central Board of Secondary Education for imparting education up to 10th Standard. Your Company has plans to have facilities and affiliation for imparting education up to 12th Standard in years to come. Your Company has also started recruiting well trained teaching and non-teaching staff in its efforts to provide better standard of education with modern educational techniques to the students of the school. The needy and poor students of local and surrounding villages are offered free-ship.

On the social front, your company, has been contributing to Village Area Development Fund for development of local village. During the year under review, your Company has continued to maintain street lights of the local village. The Drinking water requirement of village is also met by making the water available right at the village door step through dedicated water tanks on regular basis.

On health services front, your Company has been conducting medical and vaccination camps in and around the local village. Free medicines are distributed. Well equipped Companyâs Hospital remains open round the clock to take care of any medical emergencies and to provide medical and health diagnostic facilities to local people. Dedicated ambulances have been pressed into service to ensure that any health exigencies are immediately addressed.

On the economic front, your Company continues to provide opportunity to local people for supply of mineral like coal, limestone, river sand, wood etc. as a mean of livelihood. Your Company has also provided small shops inside the premises to villagers to sale daily needs and to earn their livelihood.

AUDITCOMMITTEE

Your Company has an audit committee at the Board level, which acts as a link between the management, the statutory and internal auditors and the Board of Directors and oversees the financial reporting process. The Committee comprises of Mr. Sajjan Bhajanka, Mr. Brij Bhushan Agarwal and Mr. Prem Kumar Bhajanka with Mr. Sajjan Bhajanka as its Chairman. The Constitution of the Audit Committee also meets the requirements under Section 292A of the Companies Act, 1956. Four meetings of the Committee were held during the year i.e. on 21st April 2012, 18th July, 2012, 19th October, 2012 and 18th January, 2013.

The Audit Committee, inter-alia, reviews :

- Quarterly, half- yearly and yearly Financial Statements before submission to the Board for approvals.

- Significant related party transactions.

- Audit Reports including Internal Audit Reports and report of internal audit team of the Company.

- The Companyâs financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

- Recommendation to the Board, the appointment, re-appointment of auditor, and, fixation of audit fees.

- Changes, if any, in accounting policies and practices and reason for the same.

The Audit Committee so constituted advises the management on the areas where internal audit can be improved. The minutes of the meetings of the audit committee are placed before the Board.

AUDITORSâ REPORT

The observations made in the auditorâs note are self-explanatory and therefore do not call for any further comments under Section 217 (3) of the Companies Act, 1956.

APPOINTMENT OF COST AUDITORS

Your Company has appointed M/s. B. Chowdhury& Company, Cost Accountants to audit the Cost Record of the Company for the financial year ended on 31st March, 2013 in terms of Section 233B of the Companies Act, 1956.

AUDITORS

M/s. Kailash B Goel & Co., Chartered Accountant, Auditors of the Company, will retire at the forthcoming Annual General Meeting and are eligible for re-appointment. The Directors recommend their reappointment for the year 2013-14. The members are requested to appoint the Auditors and authorize the Board of Directors to fix their remuneration.

FORWARD LOOKING STATEMENTS

In the Management Discussion and Analysis and Directorsâ Report statements given while describing Companyâs Long Term Plans, objectives, prospects and opportunities may be forward looking. Such Statements have been made on the basis of experience so far and are contingent upon various factors like legislative and regulatory developments, macro economic and political trends, domestic demand and supply conditions affecting selling prices, new capacity additions which are material to the business operation of the Company and actual performance may differ materially from those expressed in the said statements.

APPRECIATION

Your directors take this opportunity to express deep sense of gratitude to the banks, Central and State Governments and their departments, the local authorities and business associates for their continued guidance and support. We would also like to place on record our sincere appreciation for the total commitment, dedication and hard work put in by every member of the CMCL family. To them goes the credit for the companyâs achievements. Your Company also wishes to convey its sincere thanks and appreciation to the villagers of Lumshnong village and other villages in Narpuh Elaka for their continuous and ever strengthening support. And to you our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.

For and on behalf of Board

Sajjan Bhajanka

Lumshnong, 24th April, 2013 Chairman and Managing Director

Mar 31, 2012

INDIA-FASTEST ECONOMIC GROWTH AMID ALL CHALLENGES

Global Financial Turmoil and Indian Economy

Globally Fiscal 2011-12 has been a year of financial turmoil for most of the nations and more particularly for European countries. The American subprime crisis that began with the bursting of the US housing bubble, the Euro zone crisis was next big cause of concern for global economies. The US subprime mortgage crisis saw rise in subprime mortgage defaults and foreclosures. The Euro Zone crisis has impacted economies of even nations with a robust economic growth. India which has been witnessing a steady growth in GDP in recent years also got impacted on accounts of these developments and fiscal 2011-12 remained full of challenges for the country. Throughout the fiscal inflation continued to pose challenges before us largely contributed by sharp depreciation in rupee coupled with increase in price of crude petroleum and other imported components. With timely intervention of the Apex Bank the one way direction of inflationary trend was arrested to some extent through credit control mechanism and by implementing very tight monetary policy.

Country witnessed decline in growth rate of the investment in the economy significantly, largely because of sharp increase in borrowing costs. High Borrowing Costs and increase in other costs have significantly impacted profitability and internal accruals of trade and industry. Slowdown in Indian economy was largely due to global factors as mentioned above and also because of domestic factors. However, in spite of all challenges Services Sector has grown by 9.4% and the Farm Sector growth rate was 2.5% during the fiscal. India continued to remain among the fastest growing economy of the world.

With these mixed cues, the country delivered economic growth rate of 6.9% for the fiscal year 2011-12 as against 8.6% for the fiscal 2010-11. However, this slowdown is being seen as a short-term phenomenon. In the near-term there may be slowdown in growth rate but with continued implementation of reform agenda on the back of sustainable economic growth, country would be in a position to attain high growth ultimately benefitting the whole trade and commerce. Fiscal Policy initiatives by Government and monetary policy measures undertaken by Apex Bank, the Indian economy is expected to grow at 7.5% in Financial Year 2012-13.

Indian Cement Industry

In spite of all challenges faced by Indian economy in general and Cement Industry in particular, Indian Cement Industry registered a growth of 6% in Fiscal 2011-12. Cement Sales registered a growth of 7% and production registered a growth of 6%. The growth rate in fiscal 2011-12 largely remained same as in the fiscal 2010-11. However, fiscal 2011-12 began with a positive outlook for cement industry but the same could not materialize due to slowdown in infrastructure and housing sector coupled with global recessionary trends.

There has been slow down in supply side as well largely attributed to lower capacity addition during the fiscal coupled with lower than expected growth in demand which resulted into lower capacity utilization by various Cement producing companies.

Costs and margins remained under pressure for the entire year. Prices of Coal being one of the major costs for cement industry increased significantly. Steep hike of 70% in the prices of Coal supplied by Coal India Limited, cost of imported coal becoming dearer every day on account of depreciation in value of rupee with increase in other input and cost of logistics and distribution affected performance of Cement

FINANCIAL RESULTS

(Rs, in Lacs)


PARTICULARS	CONSOLIDATED		STANDALONE
	2011-2012	2010-2011	2011-2012	2010-2011

Net Sales / Income	56,729.00	49,263.37	33,789.15	32,759.71
Profit before Interest, Depreciation, Tax and extra ordinary items	14,548.29	15,147.22	7,272.73	10,131.23
Extraordinary Items	(741.73)	168.17	(350.13)	69.07
Profit before Interest, Depreciation and Tax	13,806.56	15,315.39	6,922.60	10,200.30
Interest & Finance Charges	(1,898.38)	(1018.14)	(1,182.83)	(410.69)
Depreciation	(2,810.87)	(2,566.67)	(1,723.58)	(1,312.15)
Profit before Tax		11,730.58 4,016.19		8,477.46
Provision for taxation:
â Current Tax	(1,900.04) (2,423.61)		(830.40)	(1,692.73)
â Less: MAT credit entitlement	1,879.56	2,423.61	830.40	1,692.73
â Net Current Tax	(20.49)	â	â	â
â MAT Credit entitlement of earlier years	(195.88)	909.65	â	â
â Short provision of Income Tax	(83.21)	â	â	â
â Deferred Tax	46.42	(118.28)	31.37	(131.62)
Net Profit after Tax (after minority)	8,982.47	12,062.04	4047.56	8,345.83

Industry during the fiscal 2011-12. Hike in prices of coal by Coal India affected prices of Local Coal too.

KEY HIGHLIGHTS 2011 -12

- Consolidated cement production increased to 11,03,800 MT during the year from 9,63,715 MT in FY

2010-11. The cement production and sales volumes increased by 14.53 % and 13.96 % respectively.

- Consolidated net sales grew from

Rs,49,032.56 Lacs to Rs,56,495.95 Lacs, recording an increase of 15.22% during the year 2011-12.

- Consolidated EBIDTA was 3.95% lower at Rs,14,548.29 Lacs.

- Consolidated profit before tax declined during the year 2011-12 to Rs,9,097.31 Lacs as against Rs,11,730.58 Lacs in the year 2010-11.

- Consolidated profit after tax was lower at Rs,8,982.47 Lacs in FY 2011-12 as against Rs,12062.04 Lacs in FY 2010-11.

- Average net sales realization has gone down by 3.76% over previous year.

Operational Performance

Your Company continued to focus upon its core marketing area of North East Region (NER) during financial year 2011â12. The Company has broken its own record by clocking highest ever cement production on consolidated basis at 11,03,800 MT during the current year as against 9,63,715 MT of cement during the last financial year. Your Company has recorded highest ever sale of cement during the FY 2011â12 on combined basis. As compared to 9,70,913 MT during the last financial year, your company has sold 11,06,422 MT of Cement during the FY 2011â12. Company has registered growth of 14.53% in Cement Production and 13.96% in sale of cement over last financial year. Your Company has achieved highest ever growth in Cement Dispatch during the FY 2011â12. The Cement dispatches on combined basis were higher by 15.55% compared to previous financial year.

Dividend

Keeping in view the operational requirement of funds and ongoing projects of the company and its subsidiary, your directors do not recommend any dividend for the year under review.

Market Developments

Company has further consolidated its presence in the market of North Eastern Region (NER). On consolidated basis your Company has sold 11,06,422 MT of Cement during the financial year 2011â12. The consolidated sale volume has grown by 13.96% as compared to last year. The companyâs market share has also grown from 17.6% during the

FY 2010â11 to 18.7% during FY 2011â12. Growth in market share with growth in demand reflects companyâ s strong foothold in the market of North Eastern Region (NER) and âSTAR CEMENTâ as a brand continued to remain at the top of mind recall amongst the retail as well as institutional consumer segment.

Growth Rate of demand of cement in NER has now moderated almost on line of national growth rate in Cement Demand. During the FY 2011â12 Cement Demand in NER has grown by close to 8% as against close to 7% growth nationally.

During FY 2011â12 your company has further widened its dealer and retail network in the market of NER.

Company has added 115 new direct dealers and 676 retail counters. With this total number of direct dealers have gone up to 619 during FY 2011â12 as compared to 504 during the previous financial year. Similarly, number of retail counters has increased to 3180 during FY 2011â12 compared to 2504 during FY 2010â11. The additional footâprint in the market will further improve the position of brand in NER.

Production and Costs Developments

Keeping all the challenges aside, your company has been able to achieve growth in cement production on sustained basis during the year under review. However, the some cost parameters have undergone major changes during the financial year 2011â12. Input cost and also cost of fuel has increased manifold. Increase in cost of working capital has further added to the woes.

Coal

During the year under review Companyâs selective approach in procurement of Coal resulted into availability of better quality of Coal.

Due to seasonal variation in quality and prices because of moisture and availability, company has adopted the policy of making bulk purchase of coal during season from October to March which resulted into availability of coal with low moisture content and better and consistent in quality. Although average landed cost ''Per Ton has gone up from Rs, 3,528/â during the FY 2010â 11 to Rs,4,081/â PMT during FY 2011â12 but better quality of coal coupled with energy conservation measures undertaken has resulted into lower consumption of coal per Ton of Clinker produced. During the FY

2011â12 factor of Raw Coal consumed to clinker manufactured is 17% as compared to 18.76% during the FY

2010â11. Specific heat consumption has also gone down marginally to 785 K Cal/Kg of clinker during the financial year 2011â12 as compared to 799 K Cal/Kg of clinker during the financial year 2010â11. Reduction in Specific Heat Consumption indicates operational improvement resulting into stabilization of overall coal cost for the company.

Fly Ash

During the financial year 2011â12 company has been able to bring improvement in sourcing of Fly Ash. Improved sourcing arrangement has, although, resulted into slightly higher landed cost but at the same time availability has been ensured. Availability of railway rakes, however, continued to remain a concern for NER. With improved sourcing arrangements from more locations company has been able to partially offset the uncertainty of availability of railway rakes for NER and continued usage of fly ash almost at the same level as during the last financial year without compromising on quality and strength of the final product in its effort to remain environment friendly, fly ash being major national concern from environment point of view.

On the cost side, landed cost of fly ash has gone up almost by 16.5% during the FY 2011â12 compared to FY 2010â11. The increase in cost has been mainly on account of increase in Road and Rail Freight.

Power Cost

During the financial year 2011â12 there has been only marginal improvement in availability of grid power. Quality of supply of grid power again continued to remain a concern. During the FY 2011â12 also MECL could supply only 38% of total power required on consolidated basis. The scenario of grid power supply has not changed significantly keeping in view the spurt in requirement of power on account of increase in industrial activity in Meghalaya and more particularly in the district of Jaintia Hills.

However, your company has been able to maintain the level of operation on sustained basis by having captive power generation source in form of arrangement with itsâ subsidiaries for supply of power and by keeping the DG Sets in standby.

On the cost side, cost per Kwh of grid

power supply continued to remain largely at last yearâs level excepting last two months of the year when MECL increased the tariff of grid power from existing Rs,3.61 per Kwh to Rs,4.10 per Kwh effective from 1st February, 2012 and its full impact will be felt in the financial year 2012â13.However, due to increased efficiency in the cost of generation of power by subsidiaries coupled with lower usage of DG Set power and with marginal increase in supply of low cost grid power, overall power cost has reduced by 136 paisa in terms of unit rate per Kwh on standalone basis and 50 paisa on combined basis.

Logistics & Freight

Logistical Challenges of North East India are unique in nature. This year has been testing time for Logistics operations under the difficult conditions of North East region. We braved all such challenges and ensured dispatch of 11.08 Lacs MT cement Ex-Plant as against 9.59 Lacs MT last year. Company has added new godowns nearer to market places to ensure lesser lead time and timely supply of cement to customers and end users.

During the FY 2011â12 your company started transporting of fly ash through waterways on trial basis to understand the cost and operational efficiencies and has successfully transported 2350 MT of fly ash through this alternate logistics arrangement. During the next financial year your company has plans to optimize the cost and operational parameters of this alternate mode of transport and once the same are achieved, a major chunk of its fly ash requirement is planned to be transported through water ways.

At the fag end of the financial year Government of India announced hike in railway freight of commodities like cement, clinker, coal and other raw materials. The hike which has been made effective from 6th March, 2012, just before the Railway and Union Budget, is as severe as 24% on cement and clinker and between 18% to 24% on coal and other raw materials. Even before this hike, the average freight cost has seen a rise of 14% during the year under review as compared to last financial year largely on account of hike in the prices of Crude Petroleum in the international market and continued load restriction on National Highway. The hike in railway freight will make the situation further worse in terms of freight cost and its full impact will be felt in the next financial year. Freight cost is one of the major cost components in total cost of cement.

Indian Cement Industry â Retrospect and Outlook

During the FY 2011â12 Indian Cement Industry has started showing signs of recovery. Compared to dismal sales growth of less than 5% during the FY

2010â11, the industry has put up a better performance during the year under review. The financial year started with a sluggish demand mainly on account of global slowdown but demand revived in the second half of the FY.

During the FY 2011â12 the Indian Cement Industry added 20 MTPA of new capacity and total installed capacity as at the end of FY 2011â12 has gone up to 330 MTPA. On the Sales side industry sold more than 223 million tons during the FY 2011â12 as against 210 million tons during the last financial year achieving a growth of more than 6% over previous year. The major part of growth was seen during the second half of the FY with strong revival in demand. During the first half of the FY the industry managed to grow by merely 3.23%.

The outlook for Indian Cement Industry looks promising with increased focus of Government on Infrastructure and Housing Sector. Interest rate on housing loan and inflation is likely to soften during the FY 2012â13. GDP Growth is likely to be in the range of 7.5% to 8% during the financial year 2012â13 on the back of expected increase in industrial production and other economic activities. Spending of Government on infrastructure and low cost housing is likely to increase manifold in coming years. The proposed allocation for Rural Infrastructure Development Fund has been increased to Rs,20,000 Crore for creating warehousing facilities in the recently presented Union Budget for the FY 2012â13. Government has presented various proposals to address the shortage of housing for low income groups in major cities and towns including allowing ECBs for low cost housing projects and setting up of a credit guarantee trust fund. Keeping in view all these developments industry expects Cement Demand to grow by 8% during the FY 2012â13.

However, on the cost front, the industry continues to face challenges. The input cost has increased manifold. Landed cost of coal, being one of the major cost drivers in the total manufacturing cost of cement has been a major concern for the cement industry and recent steep hike of more than 60% in the prices of Coal by Coal India has further added to the woes of industry as a whole. Freight cost being one of another major cost has also gone up substantially. Both Railway freight and Road freight have increased substantially during the FY 2011â12 as compared to last financial year. All these developments have put substantial pressure on the margins of industry as a whole.

Cement Scenario In Northeast â Retrospect, Outlook and Opportunity

Indiaâs North Eastern region is a ârainbow country ...extraordinarily diverse and colorful, mysterious when seen through parted cloudsâ. It stretches from the foothills of the Himalayas in the eastern range and is surrounded by Bangladesh, Bhutan, China, Nepal and Myanmar. The region is rich in natural resources, covered with dense forests, has the highest rainfall in the country, with large and small river systems nesting the land.

However, NER so rich with natural resources has not been able to catch up with the pace of development which has taken place in rest of India. Important parameters like Per Capita Gross State Domestic Product (GSDP), Per Capita Electricity Consumption, Per Capita income of NER as compared to rest of India also suggests that a lot of efforts are still required to be put for the socioâeconomic development of the region. Keeping this wide gap into consideration, the Central Government, in the recent past, has been focusing on the development of NER and budgetary allocation for development of the region has seen increasing trend year after year.

Recognizing the wide opportunity presented by NER, your company was pioneer in setting up an integrated Cement Manufacturing facility in one of industrially backward district of Jaintia Hills in the State of Meghalaya way back in the year 2002 and thereafter has never looked back and has been able to successfully position its brand âSTAR CEMENTâ as market leader and âSTAR CEMENTâ as a brand has consolidated its position in the market of NER in last eight years. The FY 2011â12 has been one of most successful year for the brand and your company has been able to achieve market share of 19% on consolidated basis.

The demand supply gap of cement in NER continues as no major capacity has build up in NER during the FY 2011â12. Cement demand in NER has grown by 8% in FY 2011â12 and still oneâthird of its total demand is being catered by import of cement from other States like Chhattisgarh, Madhya Pradesh and West Bengal. Recognizing this wide gap your company started setting up 1.75 MTPA Clinkerisation unit through its subsidiary Star Cement Meghalaya Limited at Lumshnong and a clinker grinding Unit at Sonapur, Guwahati.

Both these projects are under advanced stage of implementation and are likely to commence commercial production during the FY 2012â13.

Subsidiaries Companies

Megha Technical & Engineers Private Limited (MTEPL) having cement grinding unit at Lumshnong, Meghalaya in which your Company owns 99.96% shareholding and Star Cement Meghalaya Limited (SCML), wherein your Company is having 100% shareholding continues to be the subsidiaries of your Company during the year under review.

Meghalaya Power Limited, which is setting up 51 MW power plants at Lumshnong and NE Hills Hydro Limited (NEHHL) also continued to remain subsidiaries of your company.

The statement pursuant to Section 212 of the Companies Act,1956 relating to subsidiaries is annexed to this report. The Board of Directors has given its consent for not attaching the financial statements of the subsidiaries referred to in the aforesaid annexed statement, pursuant to general circular no. 2/2011 dated 8th February, 2011 of the Ministry of Corporate Affairs, Government of India. However, the annual account of Subsidiary Companies and the related detailed information shall be made available to the shareholders of the company and that of subsidiaries seeking such information at any point of time. The annual accounts of subsidiaries are also available for inspection by any share holder at the corporate office of the company and that of itsâ subsidiary.

Consolidated Financial Statements

Your Company has also prepared the Consolidated Financial Statement in accordance with Accounting Standards 21 issued by Institute of Chartered Accountant of India, which comprises of the financial statement of the Company and the subsidiaries MTEPL,SCML,MPL, and NEHHL.

The audited consolidated financial statements together with Auditors'' Report form part of the Annual Report.

The consolidated net profit of the Company and its subsidiaries amounted to Rs,8,982.47 Lacs for the financial year ended on 31st March, 2012 as compared to Rs,4,047.56 Lacs for the Company on a standalone basis.

New Projects

The upcoming project of cement grinding unit at Sonapur, Guwahati in Assam is progressing at satisfactory pace and this unit is likely to commence its commercial production during the FY 2012â13.

The project progress of upcoming 1.75 MTPA Clinkerisation unit of its subsidiary Star Cement Meghalaya Limited has also been satisfactory during the FY 2011â12 and project is now under advanced stage of completion. This unit is also expected to commence its commercial production during the FY 2012â13.

Holding Company

Century Plyboards (India) Ltd (CPIL) remains the Holding Company of your Company, with a stake of 70.48 % in your Company.

Internal Control Systems

Internal Control Systems have been designed and put to use in such a manner that all operational and related activities are performed efficiently and effectively. Significant financial information that is relevant is accurate and reliable and is provided in a time bound manner. The system in place ensures that resources are acquired economically, used efficiently and safeguarded adequately. It also ensures that employeesâ actions are in accordance with policy framework of the company and in conformity of statutory provisions applicable from time to time. Opportunities identified during audits and reviews of control systems are discussed and if found effective are implemented.

The internal control systems are periodically reviewed by audit committee and suggestions on its adequacy and effectiveness for further improvements are adopted.

Particulars of Employees

The Particulars of employees as required u/s 217 (2A) of the Companies Act, 1956 are not given as none of the employees were in receipt of remuneration exceeding the limits specified therein.

Human Resource and Industrial Relations

Your Company has been strong believer of the fact that Human Asset is the biggest asset for any organization to grow successfully and recognizes people as the primary source of its competitiveness, and continues to focus on people development by leveraging technology and developing a continuously learning human resource base to unleash their potential and fulfill their aspirations.

The company has been growing year after year in terms of volume and profit margins on the strength of its strong human assets. The human resources team has been continually focusing on the means to achieve the companyâs goals of meeting such growth targets through external recruitment & right skilling and by improving the capabilities of existing people through people development initiatives.

During the FY 2011â12 the company continued to maintain industrial harmony and peace and industrial relations remained normal.

Occupational Health and Safety

In the changing environment it has become essential that an effective Health and Management System is in place around the work place which ensures improvement of performance through less accident rates and by improving employeesâ morale. Health and safety is one of the most important aspects of an organizationâs smooth and effective functioning. Good health and safety performance ensures an accident free industrial environment.

Keeping the above objective into mind your company has been taking various initiatives to ensure that an effective Health and Management System is always in place around the work place which is more focused towards employees and workmen. It has been widely accepted that a large number of accidents and nearâmisses take place out of human error, negligence and ignoring the Standard Operating

Procedures. This kind of complacency normally develops in absence of regular discussion, analysis and awareness programme amongst the employees and workmen. Keeping in view these facts into mind, your company has been regularly conducting awareness programmes in various forms. During the FY 2011â12 too, a number of such programmes were conducted. An EHS gate meeting is conducted every month to enhance general awareness on various aspects of occupational health and safety management system. Prizes are distributed for âBest Suggestionâ and âBest Safety Conscious Workmen of the monthâ. Similarly, an EHS Committee Meeting is conducted every month in which participation of all the departments is ensured and all safety related matters are discussed and measures implemented are reviewed.

Operational area and Project Sites have been subjected to safety audits periodically and any deficiency observed are discussed and complied. Regular Safety Visits are carried out and employees and workmen are made aware of benefits of using protective equipments.

Your company has conducted training programmes amongst employees and workmen in form of Pep Talk, 5S, and Disaster Management Plan.

To create awareness from time to time your company has been celebrating various events. Apart of various other celebrations, National Safety Week was celebrated from 4th March to 10th March.

World Environment Day was celebrated on 4th June, 2011 to mark the importance of diverse life forms for the well being of humanity. During the FY 2011â12 a âGreen Beltâ has been developed in and around the plant and colony. Company also received ICC Environment Awardâ2011 in Silver Category of Large Business Organization from Indian Chamber of Commerce, Kolkata.

The Company continued to comply with systems and processes of OHSAS -18001.

Directors

Mr. Brij Bhushan Agarwal, Mr. Sanjay Agarwal and Mr. Rajendra Chamaria, retire by rotation at the forthcoming Annual General Meeting in accordance with the provisions of the Companies Act, 1956 and Company''s Articles of Association and being eligible, offer themselves for reappointment.

The Board recommends to the members the reappointment of retiring Directors.

During the year under review Mr. Sajan Kumar Bansal and Mr. S.B.Roongta have resigned from the Board. Board acknowledges their contribution to successful operation of the Company during their tenure.

Director''s Responsibility Statement

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 as amended, the Board of Directors hereby confirms:

1. That in the preparation of Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

2. That the Director''s have selected appropriate accounting policies and have applied them consistently and have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2012 and of the Profit & Loss Account and Cash Flow of the Company for year ended 31stMarch''2012.

4. That the Directors have prepared the annual accounts ongoing concern basis.

Corporate Citizenship

The Company has retained a collective focus on various areas of corporate sustainability that impact people, the environment and society at large. The company has been firm believer of the philosophy that society is not just another stakeholder, but the prime purpose of its business, the Company, across its various operations, is committed to making a positive contribution in a number of ways. The Company believes passionately that good corporate citizenship and good business performance go hand in hand and nurture each other through good times and bad.

During the year under review company has actively contributed in various ways towards benefit of local people and society at large. For upliftment of education in the local area company has been contributing to various local charitable institutions, School and Colleges in form of donation to Village Welfare Fund of the local Village as well as villages in surrounding viz. Tongseng, Nongsder, Barapani, Byndihati, Police Public School, Jowai, Government Boysâ Secondary School, Jowai, Dorbar of Elaka Narpuh and so on.

Similarly, to promote sports amongst youth of local village and Narpuh Elaka, company has contributed through various local sports body and youth organizations viz. Elaka Narpuh Sports Association, Lumshnong Social Sports Club, Durbar Shnong, Umkiang, Federation of Khasi, Jaintia and Garo people and so on.

In addition to above, company through its charitable trust namely Lumshnong Village Local Area Welfare Trust (LVLAWT) has started imparting charitable activity and one of the most important project which the trust has undertaken is construction of new school building of CMCL Vidya Bharti School for the benefit of students of local village and Elaka at large, in addition to children of employees of the Company. The school building is under advanced stage of completion and is likely to shift in the new building during the FY 2012â13. CMCL Vidya Bharti Schools presently has facility up to standard Eighth and during the Financial Year 2012â13 IXth and Xth Standard are proposed to be added.

The school has already initiated the process of affiliation with Central Board of Secondary Education (CBSE).

During the FY 2011â12 your company has made contribution for providing primary education to tribal children. Guwahati Blind School continued to get financial support during the year under review too.

Company has not restricted its activity only to local village or Elaka but has also extended its helping hand to society at large in other parts of the NER. For the benefit of tribal society company has constructed public toilets in different parts of the State of Meghalaya during the FY 2011â12. Company has been organizing medical camps, vaccination and health camps in and around the local village and in other areas too. During the financial year 2011â12 also company organized such camps and also a health camp in Ambubachi Mela at Kamakhya Temple in Guwahati. Company also organized a free eye operation camp at Guwahati Nethralaya for 25 persons.

For economic upliftment of local people your company has created business opportunities in various forms. Coal, Lime Stone, River Sand etc are procured from local people. Company has provided infrastructures in form of small shops wherein local people can earn their livelihood by vending various daily need articles. Company supplies cement to the people of local village at subsidized rates as a helping hand in their dream of constructing a house in life time true.

Audit Committee

Your Company has an audit committee at the Board level, which acts as a link between the management, the statutory and internal auditors and the Board of Directors and oversees the financial reporting process. The Committee comprise of Mr. Sajjan Bhajanka, Mr. Brij Bhushan Agarwal and Mr. Prem Kumar Bhajanka with Mr. Sajjan Bhajanka as its Chairman. The Constitution of the Audit Committee also meets the requirements under Section 292A of the Companies Act, 1956. Four meetings of the Committee were held during the year i.e. on 27th April 2011, 31st August 2011, 20th October, 2011 and 21st Januaryâ2012.

The Audit Committee, interâalia, reviews:

- Quarterly, halfâ yearly and yearly Financial Statements before submission to the Board for approvals.

- Significant related party transactions.

- Audit Reports including Internal Audit Reports and report of internal audit team of the Company.

- The Companyâs financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

- Recommendation to the Board, the appointment, reâappointment of auditor, and, fixation of audit fees.

- Changes, if any, in accounting policies and practices and reason for the same.

The Audit Committee so constituted advises the management on the areas where internal audit can be improved. The minutes of the meetings of the audit committee are placed before the Board.

Auditors'' Report

The observations made in the auditor''s note are selfâexplanatory and therefore do not call for any further comments under section 217 (3) of the Companies Act, 1956.

Appointment of Cost Auditors

Your Company has appointed M/s. B. Chowdhury & Company, Cost Accountants to audit the Cost Record of the Company for the financial year ended on 31st March 2012 in terms of Section 233B of the Companies Act, 1956. The Report shall be placed before the Audit Committee as and when submitted.

Auditors

M/s. Kailash B Goel & Co., Chartered Accountant, Auditors of the Company, will retire at the forthcoming Annual General Meeting and are eligible for reâappointment. The Directors recommend their reâappointment for the year 2012â13. The members are requested to appoint the Auditors and authorize the Board of Directors to fix their remuneration.

Forward Looking Statements

Appreciation

Your directors take this opportunity to express deep sense of gratitude to the banks, Central and State Governments and their departments, the local authorities and business associates for their continued guidance and support. Your Directors would like to place on record the valuable contribution of Mr. Sajan Kumar Bansal and Mr. S.B.Roongta who have resigned from the Board during the FY 2011â12. We would also like to place on record our sincere appreciation for the total commitment, dedication and hard work put in by every member of the CMCL family. To them goes the credit for the company''s achievements. Your Company also wishes to convey its sincere thanks and appreciation to the villagers of Lumshnong village and other villages in Narpuh Elaka for their continuous and ever strengthening support. And to you our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.

For and on behalf of the Board

Sajjan Bhajanka

Chairman and Managing Director

Place : Kolkata,

Date: 21st day of April''2012

Mar 31, 2011

DIRECTORSâ REPORT

Dear Members, 2010-11 â India Growth Story Back On Track

The fiscal year 2011 witnessed a faster and broader recovery in the Indian economy. Robust growth and steady fiscal consolidations have been the hallmark of the Indian economy in the year 2010-11. The GDP growth rate has been 8.6% during the current year and is expected to be around 9% in the next fiscal year. The growth has been broad-based with a rebound in the agriculture sector which has grown at 5.4%. Manufacturing and services sector have registered impressive gains. Domestic demand, however, continued to hold the key to broad-based growth. Despite the gradual withdrawal of stimulus measures which were introduced in 2008, private consumption and investment, two important domestic demand drivers, recovered strongly in 2010-11 as the confidence of consumers and investors was restored.

While the growth outlook remains strong, in the near term, there are number of challenges facing our economy such as double digit food inflation, higher commodity prices and hardening global energy prices. Concerted and coordinated monetary, fiscal and policy measures are required to tackle these challenges, head on.

The world economy has also been gradually coming out of a downturn and showing signs of recovery. Most of the economic indicators out of the US have improved, signaling the pick-up in recovery, but state of economies of many developed countries in the Euro zone is a cause of concern with severe sovereign debt crisis. The robust growth in India and China has provided an impetus to the ongoing recovery of the world economy.

Despite the risks of global events, such as volatility in commodity prices like crude oil exacerbated by political turmoil in the Middle-East, the Indian economy seems poised to scale greater heights in terms of macroeconomic indicators. The long-term growth prospects of the economy seem bright given the strong fundamentals of the economy and India is well positioned to attain a sustainable high growth trajectory.

While there has been marginal growth in cement demand during the fiscal 2010-11 of around 6%, there have been significant cement capacity additions leading to lower capacity utilization of barely 80%. Industry had to contend with decline in cement prices across all regions simultaneous with a surge in costs of major inputs like coal, fly ash, gypsum etc., which led to decline in profitability. Despite overall subdued demand growth at a pan-India level, cement demand in the North East remained buoyant during the year except for the monsoon period. Growth in domestic cement demand is expected to remain strong, given the revival in the housing markets, continued Government spending on the rural sector, and the gradual increase in the number of infrastructure projects being executed by the private sector. Thus, the trend in demand growth seen during the last five years is expected to continue over the medium term. Also, with the Government targeting an over 8% GDP growth rate, cement demand should grow at 8-10% over the next few years.

Key Highlights 2010-11

- The clinker production increased by 18.64% to 7,14,500 MT in FY 2010-11 and consolidated cement production increased to 9,63,715 MT during the year from 9,17,853 MT in FY 200910. The cement production and sales volumes increased by 5% and 4.69% respectively on consolidated basis.

- Consolidated net sales grew from '' 45,130.87 lacs to Rs, 48,592.50 lacs, recording an increase of 7.67% during the year 2010-11.

- Consolidated EBIDTA was 4.47% lower at Rs, 15,236.44 lacs.

- Consolidated profit before tax declined during the year 2010-11 to Rs, 11,761.73 lacs as against Rs, 12,900.47 lacs in the year 2009-10.

- Consolidated profit after tax was flat at Rs, 12,062.05 lacs in FY 2010-11 as against Rs, 12,315.59 lacs in FY 2009-10.

Financial Results

(Rs,in lacs)

Particulars	Consolidated		Standalone
	2010-2011	2009-2010	2010-2011	2009-2010
Net Sales/Income	48,592.50	45,130.87	32,458.46	30,562.86
Profit before Interest, Depreciation and Tax	15,236.44	15,949.65	10,149.48	11,496.03
Interest & Finance Charges	(908.04)	(886.96)	(340.08)	(453.19)
Depreciation	(2,566.67)	(2,162.30)	(1,312.15)	(1,477.09)
Profit Before Tax	11,761.73	12,900.39	8,497.25	9,565.74
Prior Period Adjustments (Net)	(4.11)	(0.25)	(4.10)	0.24
Provision for Taxation:
- Current Tax	(2,450.65)	(2,245.95)	(1,708.43)	(1,646.06)
- Less: MAT Credit Entitlement	(3,333.26)	1,625.74	1,692.73	1,625.74
- Net Current Tax	882.61	(620.21)	(15.70)	(20.32)
- Deferred Tax	(118.28)	36.82	(131.62)	26.74
- Excess Provision for Income Tax
Written back	-	-	-	-
- Fringe Benefit Tax	-	-	-	-
Net Profit After Tax (after Minority)	12,062.05	12,315.59	8,345.83	9,572.41
Gross Cash Accruals	15,211.90	14,567.85	9,794.61	11,118.41
Balance (Dr)/Cr Brought forward	31,729.36	24,092.22	26,566.86	21,672.90
Amount Available for Appropriation	43,791.41	36,407.81	34,912.69	31,245.31
Appropriation:
Interim Dividend	(838.43)	(3,144.10)	(838.43)	(3,144.10)
Proposed Dividend	(838.43)	-	(838.43)	-
Tax on Distributed Profit	(278.50)	(534.34)	(278.50)	(534.34)
Transfer to General Reserve	(900.00)	(1,000.00)	(900.00)	(1,000.00)
Balance (Dr)/Cr carried to Balance Sheet	40,936.05	31,729.36	32,057.33	26,566.86

Operational Performance

The primary market and geographical presence of your Company continues to remain in North East Region (NER). Your Company, during the year 2010-11 has achieved the highest ever production of 7,14,500 MT of clinker as against 6,02,220 MT during the last financial year. The Company has achieved highest cement production on consolidated basis at 9,63,715 MT during the current year as against 9,17,853 MT of cement during the last financial year. Your Company has recorded highest ever sale of cement and clinker during the FY 2010-11 on combined basis. As compared to 9,10,664 MT during the last financial year, your Company has sold 9,70,913 MT of cement and clinker during the FY 2010-11. Your Company has registered growth of 18.64% in clinker production, 5% in cement production and 4.69% in sale of cement over the last financial year.

Dividend

During the year, your Company has paid interim dividend of 20% (Rs, 2.00 per share) and also proposed a final dividend of 20% (Rs, 2.00 per share) involving total outgo of Rs, 1,955.36 lacs (including dividend distribution tax of Rs, 278.50 lacs) as against Rs, 3,678.44 lacs (including dividend distribution tax of Rs, 534.34 lacs) in the previous year. This represents payout ratio of around 20%.

Market Developments

FY 2010-11 has been the year of highest ever sales volume achieved by the Company on consolidated basis. The Company has further strengthened its presence in North East Region (NER). The Company, on consolidated basis, has sold 9,70,913 MT of cement and clinker during the financial year 2010-11. The consolidated sale volume has grown by 4.69% as compared to last year with a market share of approximately 17%, thereby making the

Star brand, the undisputed leader in terms of market share and revenue generation in North East India. The presence of the brand in the retail segment as well as in all the major infrastructural development projects was the major driver in achieving this feat. The North East''s cement demand is continuing to grow at a much faster pace than the all-India cement demand in view of upcoming large scale infrastructural projects in hydel power generation, roadways, railways, defense and rural and urban infrastructure by both Central and State Governments.

The Company has further deepened its roots in all the rural and urban areas with its retail chain which comprises of 504 direct dealers and 2504 retail counters in almost all major towns/cities of the North East. The focus being the individual house builders, for whom a specially designed after sales service has been incorporated with a motto to have a satisfied and happy customer.

The focus has also been on value addition for which routine ''Guest Lecturer Series'' are conducted for technocrats towards experience and expertise sharing and thereby leading to better understanding of Civil Engineering aspects for building a better tomorrow.

The brand enjoys a favored status in prestigious Government departments, naming a few like BHEL, NTPC, NHPC, NEEPCO, BCPL, BRPL, POWER GRID, NHAI, NFR, CPWD etc.

Production and Costs Development

Your Company has recorded its highest-ever production of cement in the FY 2010-11. Cement production in FY 2010-11 has increased by 5% over FY 2009-10. Cost of inputs sourced from the market such as fly ash, gypsum and mill scale has increased, as compared to last year.

Coal

The quality of Meghalaya coal continued to remain a challenge. There has been no significant improvement in its quality. There has been only a marginal change in consumption of coal as percentage of clinker produced. Specific heat consumption has gone down to 799 kcal/kg of clinker during the financial year 2010-11 compared to 834 kcal/kg of clinker during the FY 2009-10. Reduction in specific heat consumption indicates operational improvement.

Fly Ash

Your Company continued using fly ash during the FY 2010-11. Disposal of fly ash generated by thermal power plants in the country has been a major national concern from an environment point of view. During the FY 2010-11, your Company has been able to further optimize fly ash consumption and the same has increased by 1% over the previous year without compromising on quality and strength of the final product.

However, availability of rakes for NER continued to pose a challenge during the current financial year also. Increase in road and rail freight has further added to the total landed cost of fly ash.

Power Cost

Supply of grid power by Meghalaya Energy Corporation Limited (MECL) continued to remain a concern both in terms of quality as well as quantity. MECL could supply only one third of total power required on consolidated basis. The industrial activities in Meghalaya and more particularly in the district of Jaintia Hills has increased manifold in the recent past without corresponding increase in power generation and supply by MECL. Your Company has been able to maintain the level of operation on a sustained basis by having captive power generation source in the form of DG Set and arrangement with its subsidiary company for supply of power. MERC has increased the power tariff from '' 3.20 per Kwh to Rs, 3.61 per Kwh with effect from September 1, 2010. However, on the brighter side, the specific power consumption of the Company has further reduced from 95.33 units in 2009-10 to 90.64 units during the current financial year.

Logistics & Freight

Logistical challenges have been one of the major concerns for your Company during the FY 2010-11. Apart from the inherent logistical challenge of the North East on account of its difficult terrain, the recent implementation of restriction on overloading has further aggravated the problem. The number of vehicles required has gone up substantially for movement of same quantity of raw material and finished goods on account of overload restrictions on highways. This has the impacted industry two folds. On the one hand, cost of freight has gone up substantially; on the other hand, availability of increased number of vehicles has become a concern. Road freight has gone up also on account of worsening crude price in international market from USD 85 prevailing at the close of FY 2009-10 to more than USD 110 at the close of FY 2010-11. This has resulted in significant increase in freight cost for input and finished goods, both.

Your Company has been able to address these concerns significantly by entering into a long-term arrangement with transporters having a large size of fleet at their disposal. Such an arrangement has resulted in the availability of a dedicated fleet at the disposal of your Company for transportation of raw material and finished goods. However, paucity of railway wagons for NER continued to remain a concern.

During the year under review, the Company faced a steep rise in major input costs, coupled with a sharp rise in freight cost, both on inward and outward movements, of material resulting in lower profitability. However, the impact of spiralling cost on the profitability has been somewhat negated by a slew of operational efficiencies on all fronts, such as reduction in specific heat consumption, increase in cement mill output and reduction in specific power consumption. The performance demonstrated the strength and resilience of our long term strategy and our vertical integration across the value chain.

Industry Outlook

There have been significant cement capacity additions of about 30 million tonnes in India during the year 2010-11. As a result of which, the total industry capacity has increased to around 300 million tonnes. These capacities are likely to put pressure on the prices in the short term. However, the long-term outlook for the industry continues to remain positive as India progresses to achieve a stronger economic position in the world scenario. The Government has indicated its commitment for achieving a sustained

GDP growth of 8-9% which would call for sustained double digit growth in cement consumption.

India is the second-largest cement producer in the world, with an installed capacity close to 300 million tonnes (MT) in 2010-2011. The sector is expected to add an additional capacity of 92.3 million tonnes (MT) by 2013. As a result, the industry will have a total installed capacity of close to 400 million tonnes (MT) by March, 2013. The total cement production for April-January 2010-11 reached 136.51 MT as compared to 130.85 MT over the corresponding period last fiscal. Further, cement despatches also witnessed an upsurge from 130.09 MT during April-January 2009-10 to 135.56 MT during April-January 2010-11. According to the latest research report âIndian Cement Industry Forecast to 2012â, produced by RNCOS, cement production in India has grown at a brisk pace during the last few years. Despite recession, the Indian cement industry performed incredibly well amid a recent boom in the infrastructure and housing markets. In view of the upcoming massive infrastructure projects, manufacturers are aggressively increasing their production capacities and the study foresees a 10.5% CAGR growth in cement production during FY 2010-FY 2014. According to a press release, the push in cement demand during the last fiscal was attributed to revival of infrastructure and real estate projects, especially in rural areas.

The cement industry is pushing for increased use of cement in highway and road construction. The Ministry of Road Transport and Highways has planned to invest USD 354 billion in road infrastructure by 2012. Housing, infrastructure projects and the nascent trend of concrete roads would continue to accelerate the consumption of cement. Increased infrastructure spending has been a key focus area. In the Union Budget 2011-12, Rs, 1.73 lac crores has been allocated for infrastructure projects, which is 46% of total plan outlay.

However, increase in input, power and freight cost would remain a concern for the Indian cement industry in the medium term. Availability of grid power, good quality of coal nearer to the manufacturing locations and availability of railway rakes for transportation of input and finished goods are other major challenges before the industry.

Cement Scenario in the North East

The North East Region (NER) continues to remain a focus area in fiscal policies of the Central Government for development of infrastructure. The growth rate of NER economy has outpaced the all-India CAGR. Cement demand has registered a growth of 13% in NER compared to 4.82% on pan-India basis. NER continues to remain a deficit zone in terms of cement supply. The cement demand of NER continues to be catered by import of cement from other states like Chhatisgarh and West Bengal.

The demand of cement in NER is driven largely by infrastructure projects undertaken by the Government as also by consumption in retail segment. There are numerous ongoing infrastructure projects in NER. Bongaigaon thermal power project (Assam), Palatana power project (Tripura), gauge conversion work undertaken by the railways in different regions of NER, a new railway line between Harmuty and Nahargaon, greenfield airports in Arunachal and other NER locations are a few of the important infrastructure projects undertaken by the Government in NER.

With development on the infrastructure front, the economy of NER has also grown and consumption of cement in housing and other retail segment has grown over the years, resulting in growth in demand of cement. During the FY 2010-11, no significant capacity addition has been seen in NER and hence, the prospect of the cement industry in NER continues to remain promising in the foreseeable future.

Subsidiary Companies

Megha Technical & Engineers Private Limited (MTEPL) having a 0.67 MTPA grinding unit at Lumshnong, Meghalaya in which your Company owns 99.96% shareholding and Star Cement Meghalaya Limited (SCML), wherein your Company is having 100% shareholding continue to be the subsidiaries of your Company, during the year under review. However, during the year under review, the Company has increased its shareholding in its erstwhile associate company Meghalaya Power Limited (MPL), which is having an 8 MW power plant and supplying power exclusively to the Company and its subsidiaries

MTEPL & SCML, from 49% to 51% to make MPL as its subsidiary w.e.f April 1, 2010. Further to this, the Company also acquired the whole of paid-up equity of NE Hills Hydro Limited (NEHHL) to make NEHHL as its 100% subsidiary w.e.f February 3, 2011 for participating in the upcoming Hydel Projects in the North East.

The statement pursuant to Section 212 of the Companies Act, 1956 relating to subsidiaries is annexed to this report. The Board of Directors has given its consent for not attaching the financial statements of the subsidiaries referred to in the aforesaid annexed statement, pursuant to general circular no. 2/2011 dated February 8, 2011 of the Ministry of Corporate Affairs, Government of India. However, the annual account of the subsidiary companies and the related detailed information shall be made available to the shareholders of the Company and that of its subsidiaries, seeking such information at any point of time. The annual accounts of subsidiaries are also available for inspection by any shareholder at the corporate office of the Company and that of its subsidiaries.

Consolidated Financial Statements

Your Company has also prepared the Consolidated Financial Statement in accordance with Accounting Standard 21 issued by Institute of Chartered Accountants of India, which comprises of the financial statement of the Company and the subsidiaries MTEPL, MPL, NEHHL & SCML. The audited consolidated financial statements together with Auditors'' Report form a part of the Annual Report. The consolidated net profit of the Company and its subsidiaries amounted to Rs, 12,062.05 lacs for the financial year ended on March 31, 2011 as compared to Rs, 8,345.83 lacs for the Company on standalone basis.

Expansion and New Projects

Your Company has completed the expansion of clinker manufacturing facility during the year under review and commercial production has started with enhanced capacity of kiln. The installed capacity for manufacture of clinker has increased from 1,800 TPD to 2,400 TPD.

The project work of the clinkerisation project of the subsidiary Star Cement Meghalaya Limited at Lumshnong, Meghalaya and the Company''s split location cement grinding unit project at Guwahati, Assam is advancing at a satisfactory pace.

Holding Company

Century Plyboards (India) Ltd (CPIL) remains the Holding Company of your Company, wherein the Holding Company has a stake of 70.48% in your Company.

Internal Control Systems

Your Company has a well-defined internal control system to support efficient business operations and statutory compliance. A team of external firms of chartered accountants appointed to carry out the internal audit function adds to the stability of the internal control systems. Suitable internal checks have been built-in to cover all monetary transactions with proper delineation of authority, which provides for checks and balances at every stage.

Your Company''s internal control system provides high level of system-based checks and controls. Regular internal audits and checks ensure that responsibilities are executed efficiently. The Company has an Audit Committee of Directors to review financial statements to shareholders. The Audit Committee reviews the adequacy and effectiveness of internal control system and suggests improvement for strengthening them from time to time.

Particulars of Employees

The particulars of employees as required u/s 217 (2A) of the Companies Act, 1956 are not given as none of the employees were in receipt of remuneration exceeding the limits specified therein.

Personnel & Human Resource and Industrial Relations

Employees of the Company are the key assets and your Company continuously strives towards the development of its employees, to upgrade their skills and to boost the motivation levels of its human resources through various mechanisms. Employees are motivated and team spirit strengthened through various departmental quality circles and other awareness programs being organized from time to time. Your Company continues to maintain a healthy working environment and cordial industrial relations throughout the year.

Occupational Health and Safety

The Company continued its focus on health and safety of employees at the workplace as an area of priority. During the year under review, a Mass Communication Meeting was started which takes place every month for awareness of workmen and employees, on environment health and safety-related aspects. A safety committee meeting is held every month to identify the area-wise unsafe aspects, if any, and to review the preventive and corrective actions of already identified areas. A root cause analysis (RCA) is conducted in respect of each and every incident/near-misses as well as of other unsafe/unhealthy aspects and shared in monthly mass communication meetings to bring awareness and to ensure participation of all. The Company has also ensured initial and periodic medical examination of its employees and workmen. The Company continued to comply with systems and processes of OHSAS - 18001. During the year under review, National Safety Day was observed on a larger scale to bring awareness among all.

Directors

Prem Kumar Bhajanka, Pankaj Kejriwal and Sajan Kumar Bansal, Directors, retire by rotation at the forthcoming Annual General Meeting in accordance with the provisions of the Companies Act, 1956 and Company''s Articles of Association and being eligible, offer themselves for re-appointment.

The Board recommends to the members the reappointment of retiring Directors.

Directorsâ Responsibility Statement

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 as amended, the Board of Directors hereby confirms:

1 That in the preparation of Annual Accounts, the applicable Accounting Standards have been followed and that there are no material departures.

2 That the Directors have selected appropriate accounting policies and have applied them consistently and have made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2011 and of the Profit & Loss Account and Cash Flow of the Company for year ended March 31, 2011.

3 That the Directors have taken proper and sufficient care 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.

4 That the Directors have prepared the annual accounts on good going basis.

Corporate Social Responsibility (CSR)

Your Company has consistently demonstrated its commitment to have positive and meaningful relations with communities in and around the Company''s plant. They are a large and significant stakeholder group, and our excellent relations with them is one of our strengths. This approach is integrated in our core values and business ethics. Your Company works with community stakeholders, balancing their expectations and concerns with our business needs. Our strong relations with the community are built and strengthened on the basis of mutual respect and trust.

During the current financial year, your Company has donated an ambulance for the benefit of residents of the local village. The Company has organized medical camps and Pulse Polio Vaccination Camp during the current financial year also for the benefit of villagers of the local as well as neighboring villages and elaka. For the development of the local village, the Company has been contributing to Village Welfare Fund on a regular basis. To take care of educational needs of students of local and surrounding villages, your Company has been donating funds to Durbar Shnong of Lumshnong Village and Tongseng Village School.

During the FY 2010-11, your Company has established the Lumshnong Village Local Area Welfare Trust (LVLAWT). This trust is charitable in nature and has been created with the sole objective of carrying out welfare activity towards the benefit of the local village and its residents thereof. Your Company has also donated the corpus fund to the trust in order to carry out the charitable work for the village. The trust has started its activity and is presently engaged in bringing up a new school building of CMCL Vidya Bharti School for better education of the students of the local village and company employees. Your Company has donated land to the trust and has also undertaken to incur the cost of the new school building.

During the FY 2010-11, your Company has contributed substantially for development of Nan Kasari Kur Dkhar Thaw Thang Sati Park at Lawmuslang, Jowai. Guwahati Blind School continued to get financial support from your Company during the last financial year also. Your Company has sponsored eminent architects and engineers of the North East to attend a seminar on disaster management, conducted overseas with an objective to disseminate the knowledge acquired among people of the North East towards better disaster management.

Audit Committee

Your Company has an audit committee at the Board level, which acts as a link between the management, the statutory and internal auditors and the Board of Directors and oversees the financial reporting process. The Constitution of the Audit Committee also meets the requirements under Section 292A of the Companies Act, 1956. Four meetings of the Committee were held during the year i.e. on April 14, 2010, July 15, 2010, October 20, 2010 and January 13, 2011.

The Audit Committee, inter-alia, reviews:

- Quarterly, half-yearly and yearly Financial Statements before submission to the Board for approvals.

- Significant related party transactions.

- Audit Reports including Internal Audit Reports and report of internal audit team of the Company.

- The Company''s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

- Recommendation to the Board, the appointment, re-appointment of auditors, and, fixation of audit fees.

- Changes, if any, in accounting policies and practices and reason for the same.

The Audit Committee so constituted, advises the Management on the areas where internal audit can be improved. The minutes of the meetings of the audit committee are placed before the Board.

Auditorsâ Report

The observations made in the Auditors'' Note are self-explanatory and therefore do not call for any further comments under Section 217(3) of the Companies Act, 1956.

Auditors

M/s Kailash B Goel & Co., Chartered Accountant, Auditors of the Company, will retire at the forthcoming Annual General Meeting and are eligible for re-appointment. The Directors recommend their reappointment for the year 2011-12. The members are requested to appoint the Auditors and authorize the Board of Directors to fix their remuneration.

Appreciation

Your Directors deeply acknowledge the continued support and co-operation received from banks, Central and State Governments, local authorities and business associates towards one more successful year of operation. Your Directors also place on record their sincere appreciation for the total commitment, dedication and hard work put in by every member of Star Parivar. Your Directors take this opportunity to convey their sincere thanks and appreciation to the villagers of Lumshnong village and other villages in Norpoh elaka for their continuous and ever strengthening support. They feel deeply grateful for the confidence and faith that the shareholders have always reposed in them.

For and on behalf of Board Sajjan Bhajanka

CH AIRMAN AND MANAGING DIRECTOR

Kolkata, April 28, 2011

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Star Cement Ltd. के निदेशक की रिपोर्ट

FINANCIAL PERFORMANCE

OVERVIEW AND OPERATIONAL REVIEW

UPCOMING/NEW PROJECTS

DIVIDEND

INDIAN ECONOMY AND OUTLOOK - ATA GLANCE

CEMENT INDUSTRY OVERVIEW

EAST & NORTHEAST SCENARIO - GATEWAYOF OPPORTUNITIES

Market Development

PRODUCTION AND COST DEVELOPMENTSFly Ash

Logistics & Freight

Power cost

KEY PERFORMANCE HIGHLIGHTS

OPPORTUNITIES & THREATS, RISKS ANDCONCERNS

Opportunities:

Threats:

Risks & Concerns

SHARE CAPITAL

SHARES IN SUSPENSE ACCOUNT

ANNUAL RETURN

MEETINGS OF THE BOARD

AUDITORS & AUDITORS'' REPORTStatutory Auditors

Cost Auditors

Secretarial Auditors

REPORTING OF FRAUD

BUSINESS RESPONSIBILITY ANDSUSTAINABILITY REPORT

PARTICULARS OF LOANS, GUARANTEES ORINVESTMENTS

RELATED PARTY TRANSACTIONS

RESERVES

ENERGY CONSERVATION, TECHNOLOGYABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO

(A) Steps taken toward Conservation of energy:

B. Steps taken toward Technical Absorption:

(B) Foreign Exchange Earnings And Outgo:

CORPORATE SOCIAL RESPONSIBILITYINITIATIVES (CSR)

EVALUATION OF THE BOARD''S PERFORMANCE

DECLARATION BY INDEPENDENT DIRECTORS

FAMILIARIZATION PROGRAMME FORINDEPENDENT DIRECTORS

BOARD DIVERSITY

SUBSIDIARIES AND ASSOCIATE COMPANY

CHANGES IN NATURE OF BUSINESS, IF ANY

BOARD POLICIES

AUDITED FINANCIAL STATEMENTS OF THECOMPANY''S SUBSIDIARIES

CONSOLIDATED FINANCIAL STATEMENTS

DEPOSITS

SIGNIFICANT MATERIAL ORDERS PASSED BYTHE COURTS / TRIBUNAL OR REGULATORS

MATERIAL CHANGES AND COMMITMENTSAFFECTING THE FINANCIAL POSITION OFTHE COMPANY

CREDIT RATINGS

POLICY ON PREVENTION OF SEXUALHARASSMENT

CORPORATE GOVERNANCE

DY. MANAGING DIRECTOR (DMD) /CHIEFFINANCIAL OFFICER (CFO) CERTIFICATION

RISK MANAGEMENT

HUMAN RESOURCE DEVELOPMENT &INDUSTRIAL RELATIONS

AWARDS AND ACCOLADES

GREEN INITIATIVES IN CORPORATEGOVERNANCE

CAUTIONARY STATEMENT

ACKNOWLEDGEMENT

FINANCIAL PERFORMANCE

OPERATIONAL REVIEW

UPCOMING/NEW PROJECTS

DIVIDEND

INDIAN ECONOMY AND OUTLOOK - AT A GLANCE

CEMENT INDUSTRY OVERVIEW

EAST & NORTHEAST SCENARIO - GATEWAY OF OPPORTUNITIES

Market Development

PRODUCTION AND COST DEVELOPMENTS Fly Ash

Logistics & Freight

Power cost

KEY PERFORMANCE HIGHLIGHTS

OPPORTUNITIES & THREATS, RISKS AND CONCERNS

SHARE CAPITAL

SHARES IN SUSPENSE ACCOUNT

INVESTOR EDUCATION AND PROTECTION FUND

ANNUAL RETURN

MEETINGS OF THE BOARD

MEETINGS OF INDEPENDENT DIRECTORS

COMMITTEES OF THE BOARD

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT EMPLOYEES

DIVIDEND DISTRIBUTION POLICY

CODE OF CONDUCT

INDIAN ECONOMY AND OUTLOOK - AT
A GLANCE

EAST & NORTHEAST SCENARIO - GATEWAY
OF OPPORTUNITIES

PRODUCTION AND COST DEVELOPMENTS
Fly Ash

OPPORTUNITIES & THREATS, RISKS AND
CONCERNS

AUDITORS & AUDITORS'' REPORT
Statutory Auditors

BUSINESS RESPONSIBILITY AND
SUSTAINABILITY REPORT

PARTICULARS OF LOANS, GUARANTEES OR
INVESTMENTS

ENERGY CONSERVATION, TECHNOLOGY
ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO

CORPORATE SOCIAL RESPONSIBILITY
INITIATIVES (CSR)

FAMILIARIZATION PROGRAMME FOR
INDEPENDENT DIRECTORS

AUDITED FINANCIAL STATEMENTS OF THE
COMPANY''S SUBSIDIARIES

SIGNIFICANT MATERIAL ORDERS PASSED BY
THE COURTS / TRIBUNAL OR REGULATORS

MATERIAL CHANGES AND COMMITMENTS
AFFECTING THE FINANCIAL POSITION OF
THE COMPANY

POLICY ON PREVENTION OF SEXUAL
HARASSMENT

DY. MANAGING DIRECTOR (DMD) /CHIEF
FINANCIAL OFFICER (CFO) CERTIFICATION

HUMAN RESOURCE DEVELOPMENT &
INDUSTRIAL RELATIONS

GREEN INITIATIVES IN CORPORATE
GOVERNANCE