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EQUITY - MARKET SCREENER

Hindustan Motors Ltd
Industry :  Automobiles - Passenger Cars
BSE Code
ISIN Demat
Book Value()
500500
INE253A01025
-0.867776
NSE Symbol
P/E(TTM)
Mar.Cap( Cr.)
HINDMOTORS
36.13
346.79
EPS(TTM)
Face Value()
Div & Yield %
0.46
5
0
 

As on: Mar 29, 2024 05:42 PM

<dhhead>DIRECTORS’ REPORT </dhhead>

TO THE MEMBERS

Your Directors present their Eighty-first (81st) Annual Report together with audited financial statements of the Company for the year ended March 31, 2023.

Financial Results / Performance

During the year under review, the Company's revenue/Other Income are Rs.3.79 Crores compared to Rs.14.58 Crores in the previous financial year. The following table gives a summary of the performance.

(Rs in crores )

Particulars

2022-23

2021-22

Gross Revenue from Operations/Other Income

3.79

14.58

Net Revenue from Operations

3.79

14.58

Profit/(Loss) before Exceptional items and Tax

(2.02)

7.32

Exceptional items (Net)

1.00

13.03

Profit/(Loss) before Tax

(1.02)

20.35

Tax Expenses

(1.07)

1.70

Net Profit/ (Loss) after tax

0.05

18.65

Other Comprehensive Income

0.05

(0.07)

a) Item that will not be reclassified to profit or loss

0.10

(0.07)

b) Tax on Comprehensive Income

-

0.02

Total Comprehensive Income for the year (Comprising Profit/(Loss) for the year (after tax) and Other Comprehensive Income (after tax)

0.10

18.60

 

The revenue account shows a profit of Rs.0.10 Crores after providing Rs.0.53 Crores for depreciation & amortisation expense. There is a deficit of Rs.148.45 Crores after adjusting revaluation reserve for land and building in the Statement of Profit and Loss as at the end of the current year as against Rs.148.55 Crores in the last year.

A Cash Flow Statement for the year under review is also attached to the enclosed Annual Accounts.

The Company is not having any subsidiary / associate company and therefore consolidated accounts of the Company have not been prepared.

DIVIDEND

There is no operational profit in the Statement of Profit & Loss after taking into account the results for the year under review. As such, Board of Directors of the Company has not considered recommending any dividend on the equity shares of the Company.

TRANSFER TO RESERVES

Since there is no reserve created during the financial year 2022-23, there is no transfer.

Review of Operations

There has been no change during the period under review in the nature of business of the Company.

As reported earlier that due to low productivity, growing indiscipline, shortage of funds and lack of demand for products, the Company was compelled to declare "Suspension of work" at its Uttarpara Plant with effect from 24th May, 2014 and the suspension of work is continuing due to no change in the situation.

No material changes or commitments or any significant and material adverse orders or rulings passed by the regulators or Courts or Tribunals impacting the going concern status and Company's operations in future have occurred between end of the financial year of the company and date of this report.

A detailed Management Discussion & Analysis Report forms part of this report is annexed as Annexure-1.

Outlook for 2023-24

In an effort to revive operations, the Company has been continuously rationalising the cost, post suspension of work at Uttarpara plant. It has reduced the fixed cost including employee cost considerably and continuously working on further reducing its fixed cost. The accumulated losses of the Company was brought down to Rs.14845.52 Lacs as on 31st March, 2023 as compared to Rs.25218.00 Lacs as on 31st March, 2017. The management is putting continuous effort in scouting for tie-ups & Potential investment/strategic partners who can introduce new products & infuse capital in the company. The Company is considering various measures including alternative use of Fixed Assets to generate revenue. The particular process has been affected adversely due to the COVID-19 pandemic situation for last two years. However, the situation is taking a positive turn with recent developments:

> The Company has entered into a Memorandum of Understanding (MOU) to extend the Electric Vehicle (EV) domain across the border to enhance the production of eco-friendly electric vehicle. However, the project is stalled at the moment due to Notice from Government of West Bengal on resumption of Uttarpara Land.

> The Company has alternate plans to facilitate and generate additional revenue and realize adequate fund required, after the resumption issue is resolved.

Thus, the Company will facilitate and generate additional revenue and realize adequate fund required.

Implication of COVID-19

In view of the outbreak of COVID-19 which has been declared as a pandemic by World Health Organisation and subsequent lockdown imposed by the Central and State Government(s) in India, the Company is closely monitoring the impact of this pandemic and believes that there has been no significant adverse impact on its financial position for the financial year ended 31st March, 2023 as its manufacturing plant located at Uttarpara, West Bengal had already been under "Suspension of Work" prior to imposition of lockdown.

Change in the nature of business, if any :

There was no change in the nature of the business of the Company during the year under report.

Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report :

No material changes and commitments affecting the financial position of the company occurred between the end of the financial year of the company to which the financial statements relate and the date of the report.

Details of significant and material orders passed by the Regulators/ Courts/Tribunals impacting the going concern status and company's operation in future :

No significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

Particulars of Loans, Guarantees or Investments

There are no Loans, Guarantees and Investments made under the provisions of Section 186 of the Companies Act, 2013 during the year under review.

Related Party Transactions

There are no contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013. The details of other transactions entered into with the Related Parties are given in the note-35 to the Financial Statements.

Deposits

Your Company has not accepted any deposit within the meaning of Section 73 of the Companies Act, 2013 and the Rules made thereunder and therefore, no amount of principal or interest was outstanding as on the date of Balance Sheet.

Corporate Social Responsibility

In view of no operating profit, provisions of Section 135 of the Companies Act, 2013 related to Corporate Social Responsibility is not applicable to the Company.

Risks and Concerns and its Management

The Company exposed to some internal risks to generate liquidity to meet the existing liability of the Company and day to day activities as the Uttarpara Plant of the Company is still under suspension of work.

In order to identify and mitigate risks, the Company has constituted a Corporate Risk Management Committee. The Company has a Corporate Risk Management Charter to identify the nature and magnitude of risk associated with the Company and to take steps for mitigating the impact of such risks. The Corporate Risk Management Committee continuously identify and prioritize the risks associated with the functioning of the Company, lays down mitigation plan for identified risks with assigning responsibilities and adequately monitoring and managing the same. These are reviewed periodically.

Industrial Relations

As reported earlier, the Company has declared "Suspension of Work" at its Uttarpara Plant in Hooghly District of West Bengal with effect from 24th May, 2014. The general industrial relation at the plant is sensitive but being managed. The number of employees as on 31st March, 2023 is 269 which was 292 as on 31st March, 2022.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2023 is available on the Company's website at hindmotor.com..

Meetings of the Board and Audit Committee

During the year, Four Board Meetings and four Audit Committee Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. The Audit Committee comprises of Independent Directors namely, Smt. Mou Mukherjee (Chairperson) and Shri Raj Kamal Johri, and a Non-Executive Non-Independent Director namely, Shri A. Sankaranarayanan. All the recommendations made by the Audit Committee were accepted by Board. Further details regarding Board Meetings and Audit Committee Meetings are given in the Corporate Governance Report which forms part of the Board's Report.

Corporate Governance

The Company continues to remain committed to high standards of corporate governance. The report on corporate governance as per the requirement of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this report is annexed as Annexure-2. The Company has complied with all the requirements of corporate governance. The certificate from the Auditors of the Company confirming compliance to the conditions of the corporate governance requirements is also annexed.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

Business Responsibility and Sustainability Report (BRSR) is not applicable to the Company.

Directors' Responsibility Statement

In terms of the requirement of Section 134 of the Companies Act, 2013, Directors' Responsibility Statement is annexed as Annexure-3 to this report.

Information on Remuneration

Information as per the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as Annexure-4 and Annexure-5 to this report.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

Additional Information relating to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section 134(3)(m) of the Companies Act, 2013 is annexed as Annexure-6 to this report.

Internal Financial Controls System

The Company has comprehensive and adequate internal financial controls system for all major processes including financial statements to ensure reliability of reporting. The system also helps management to have timely data/feedback on various operational parameters for effective review. It also ensures proper safeguarding of assets across the Company and its economical use. The internal financial controls system of the Company is commensurate with the size, scale and complexity of its operations. The systems and controls are periodically reviewed and modified based on the requirement. The Company has an internal audit function which is empowered to examine the adequacy and compliance with policies, plans and statutory requirements. It is also responsible for assessing and improving the effectiveness of risk management, control and governance process. The scope of Internal Audit is well defined and documented and the audit committee reviews the observations of the Internal Audit critically. The composition and working of the audit committee forms part of the Corporate Governance Report.

Auditors

The Report by the Auditors is self-explanatory. The Statutory Auditors of the Company, M/s. Ray & Ray, Chartered Accountants (Registration No.301072E), were appointed in the Seventy-seventh Annual General Meeting of the Company held on 18th September, 2019, as Statutory Auditors of the Company until the conclusion of Eighty-second Annual General Meeting to be held in 2024 i.e., for the financial years 2019-20 till 2023-24.

Further, with regard to preparation of accounts on going concern basis, the Auditors have made some observations under "Emphasis of Matter" appearing in the Auditors' Report which the management has responded in note-42 to the audited financial statements for the year ended 31st March, 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. R.B.M. & Associates, a firm of Company Secretaries in Practice (CP No.20376) to undertake the Secretarial Audit of the Company.

The Report of the Secretarial Auditor is annexed herewith as Annexure-7. There are no qualifications or observations or remarks made by Secretarial Auditor in his report.

Subsidiary/Joint Venture/Associate

Your Company has no subsidiaries or Joint Venture or Associate company.

Declaration by Independent Directors

Shri Raj Kamal Johri, Smt. Mou Mukherjee and Shri Om Prakash Gupta are Independent Directors on the Board of your Company. In the opinion of the Board and as confirmed by these Directors, they fulfil the conditions specified in Section 149 of the Companies Act, 2013 and the Rules made thereunder about their status as Independent Directors of the Company.

Independent Directors Database

MCA vide its Notification dated 1st December, 2019 introduced new Rules called the Companies (Appointments and Qualification of Directors) 5th Amendment Rules, 2019 for person eligible and willing to be appointed as an Independent Director. Rule states that the compliances to be carried out before appointment of Independent Director as well as for those who are already appointed.

All our Independent Directors have already registered their names in the Independent Directors database.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS

The details of familiarization programme for Independent Directors has been disclosed on the website of the Company www.hindmotor. com and web link thereto is http://www.hindmotor.com/files/Familiarisation-Programme-for-Independent-Directors.pdf.

Directors

There are no changes in the Board of Directors of the Company during the year under report.

At the ensuing Annual General Meeting, Mr. Uttam, Bose, Director of the Company, retires by rotation and being eligible offers himself for re-appointment.

Information about the Director proposed to be reappointed as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is provided in the Report on Corporate Governance forming part of this Report.

Key Managerial Personnel

Shri Prakash Sahu is continuing as the Chief Executive Officer of the Company.

Shri Mahesh Kumar Kejriwal is continuing as the Chief Financial Officer of the Company.

Mrs. Vishakha Gupta is continuing as the Company Secretary of the Company.

Policy on Appointment of Director and Remuneration

The Nomination and Remuneration Committee identifies and ascertains the integrity, qualification, expertise, skills, knowledge and experience of the person for appointment as Director and Key Managerial Personnel. The appointment of a Director as recommended by the Nomination and Remuneration Committee requires approval of the Board.

The remuneration / compensation / commission etc. to the Directors and Key Managerial Personnel is proposed by the Nomination and Remuneration Committee in compliance with requirements of the Companies Act and recommended to the Board for it's approval. Approval of Shareholders is obtained, if required.

The Directors receive remuneration by way of fees for attending meetings of the Board or committees thereof.

At the time of appointing an Independent Director, a formal letter of appointment is given to the candidate, which inter-alia, explains the role, functions, duties and responsibilities expected of the person as an Independent Director of the Company. The Independent Director is also explained in detail the compliance required from him under the Companies Act, 2013 and other relevant regulations. The independence of Director is decided as per provisions of the Companies Act, 2013.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for remuneration of Directors, Key Managerial Personnel and Senior Management. The said Remuneration Policy is posted on the website of the Company www.hindmotor.com. The web link is as follows:- http://www.hindmotor.com/files/HML-Remuneration-Policy-29052019.pdf

Board Evaluation

The Board of Directors evaluated the annual performance of the Board as a whole, its committees and the directors individually in accordance with the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, in the following manner:-

i. Structured evaluation forms, as recommended by the Nomination and Remuneration Committee, 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, for evaluation of the performance of the Board, its Committees and each director were provided to all the members of the Board.

ii. The members of the Board were requested to evaluate by filling the evaluation forms and the duly filled in evaluation forms were required to be sent to the Company Secretary in a sealed envelope or personally submitted to the Chairman at the concerned meeting.

iii. Based on the individual evaluation of the Directors, the Board initiated a detailed discussion at the concerned meeting on the performance of the Board/Committee/Individual Director, and formulated a final collective evaluation of the Board. The Board also provided an individual feedback to the concerned director on areas of improvement if any.

A separate meeting of Independent Directors was held on 10th November, 2022 to evaluate the performance evaluation of the Chairman of the meeting of Board of Directors (as there is no chairman of the Board), the Non-Independent Directors, the Board and flow of information from management.

Three new updated policies namely, (1) Policy on materiality of related party transactions and also on dealing with related party transactions, (2) Whistle Blower Policy and (3) Policy for determination of materiality of an event or information for disclosure to Stock Exchanges were adopted at the Board Meeting of the Company held on 8th February, 2023.

Vigil Mechanism/Whistle Blower Policy

As per Section 177(9) of the Companies Act, 2013 read with Rule 7 of Companies (Meetings of Board and its Powers) Rules, 2014 and Clause 49 of the Equity Listing Agreement, the Company has established an effective vigil mechanism named Whistle Blower Policy ("the Policy") which is also in conformity with the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with a view to provide a mechanism for Directors and Employees of the Company inter alia to raise genuine concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any financial statements and reports, etc. The Company encourages its employees to use the mechanism and has made provision for direct access to the Chairman of the Audit Committee in appropriate and exceptional cases. Adequate safeguards against victimization of the persons who use such mechanism are provided in the policy. The policy is posted on the website of the Company www.hindmotor.com.

Fraud

No case of any fraud has been reported during the year under report.

Share Capital

There has been no change in the share capital of the Company during the year under report. The paid up equity share capital of the Company as on 31st March, 2023 was Rs 104.41 Crores.

Disclosure under The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has in place a policy for prevention of sexual harassment in accordance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The Company did not receive any complaint during the year 2022-23.

Cost Audit Record

The Company is not required to maintain Cost Audit records in term of Section 148 (1) of the Companies Act, 2013.

Secretarial Standards

The Board of Directors hereby affirms that your Company in general has adhered to the Secretarial Standards as prescribed by the Institute of Company Secretaries of India during the financial year.

Other disclosures:

a) The Company has not entered into any one-time settlement proposal with any Bank or financial institution during the year.

b) As per available information, no application has been filed against the Company under the Insolvency and Bankruptcy Code, 2016 nor any proceedings thereunder is pending as on 31.03.2023.

Appreciation

Your Directors acknowledge and thank the Company's customers, shareholders, state government authorities, business associates, banks and financial institutions for the support extended to the Company. Your Directors also record their appreciation for the commitment and dedication of the employees of your Company.

For and on behalf of the Board of Directors
Uttam Bose A. Sankaranarayanan
Kolkata Director Director
08th May, 2023 (DIN- 02340000) (DIN- 00385632)