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Asian Hotels (North) Ltd Directors Report

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Jul 19, 2024|09:44:52 AM

Asian Hotels (North) Ltd Share Price directors Report

To the Members of

Asian Hotels (North) Limited ("the Company or AHNL")

Your Directors are pleased to submit their Forty second (42nd) Report together with the Audited Financial Statements for the financial year ended on 31st March, 2023 ("year under review").

FINANCIAL RESULTS & THE STATE OF COMPANYS AFFAIRS

The summary of the financial performance of the Company for the financial year ended 31st March, 2023 as compared to the previous financial year on Standalone Basis is as below:

(Amount Rupees in Lakhs)

Particulars FY 2022-23 FY 2021-22
Revenue from Operations (Net) 25,577.99 13,052.54
Other Income 166.58 409.12
Total Income 25,744.57 13,461.66
Profit/(Loss) before exceptional items and tax (8,482.06) (12,481.15)
Exceptional Items -
Profit/(Loss) before Tax (8,482.06) (12,481.15)
Provision for Tax (net of write backs)including Deferred Tax Assets (Net) -
Net Profit/(Loss) (8,482.06) (12,481.15)
Earning per share - Basic & Diluted (Rs.) (43.60) (64.16)

Companys Performance

Total revenue from operations for the financial year 2022-23 was higher at Rs. 25577.99 lakhs as compared to Rs. 13,052.54 lakhs in the previous financial year, showing an increase of 95.96% over the previous financial year.

Combined revenue from Food & Beverage including Wines & Liquor registered a significant increase of 83.74% and the room revenue increased by 134.61% during the year under review, as compared to the previous financial year.

The Total Income for this year was Rs. 25744.57 lakhs, which was higher by 91.24% than the previous years Total Income of Rs. 13461.66 lakhs.

Further, the Company reported a Net Loss of Rs. 8,482.06 lakhs in this year in comparison to the Net Loss of Rs. 12,481.15 lakhs for previous financial year.

TRANSFER TO RESERVES

No amount was transferred to the General Reserve for the year under review.

DIVIDEND

In view of the loss suffered by the Company, your Directors are constrained not to recommend/declared any dividend during/for the year under review.

FINANCIAL STATEMENTS

In accordance with the provisions of Section 129 of the Companies Act, 2013 ("the Act") read with rules thereunder and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations"), your Directors have presented the financial statements of the Company for the financial year 2022-23, as part of this Annual Report.

In accordance with the provisions of Section 136 of the Act, Balance sheet, statement of profit & loss, cash flow statement, statement of changes in equity and notes to accounts are open for inspection by the members at the registered office of the Company, copies of which may be furnished, if desired by any member.

MATERIAL CHANGES AND COMMITMENTS IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY BETWEEN THE END OF THE FINANCIAL YEAR UNDER REVIEW TO WHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THIS REPORT.

During the year under review Lexon Hotel Ventures Limited, Mauritius ("Lexon"), a step down subsidiary of the Company, gets under the process of liquidation according to the applicable provisions of the Mauritius Law.

Lexon is a 80% subsidiary of Fineline Hospitality & Consultancy Pte. Ltd. ("FHCPL"). Since Lexon was the only asset under FHCPL and was under liquidation, therefore, liquidation proceedings were also initiated for FHCPL.

It may be noted that FHCPL and Lexon are not a material subsidiary of Asian Hotels (North) Limited.

Further, the ultimate subsidiary company, i.e., Leading Hotels Limited is still under Corporate Insolvency Resolution Process (CIRP).

Furthermore, under One Time Restructuring (OTR), while the OTR stands implemented there are few litigations with the lenders, wherein interim orders in favour of the Company are in operation. There are certain impediments in the OTR compliance which is being considered at the Joint lenders meeting (JLM). These factors and expected future improvement in business operations will be critical for the Company to continue as a Going Concern.

The Company will continue to monitor the material changes in future economic conditions and would recognize any significant impact of these changes affecting the Company, in the financial statements, as and when these conditions arise.

Save as otherwise stated above, your Directors would like to inform that no other material changes and commitments have occurred between the end of the financial year under review and the date of this report that may adversely affect the financial position of the Company.

Shopping Arcade

In a significant decision, your Directors in their meeting held on 23rd May, 2020 decided to revoke all existing license agreements in respect of the shops in Hotel Hyatt Regencys Shopping Arcade.

In pursuance of the aforesaid decision, revocation notices were issued to all the licensees and thereafter they moved to the Delhi High Court. The status quo of the litigation initiated by the licensees with regard to Shopping Arcade area continued the same.

AHNL has filed an application under Section 8 of the Arbitration and Conciliation Act, 1996 before the Delhi High Court. This application pertains to 27 pending cases involving shop owners. Section 8 of the aforementioned act stipulates that a judicial authority, based on the arbitration agreement between the involved parties, is empowered to instruct the parties to engage in arbitration and the matter is now reserved for orders. Additionally, there are 8 related cases of shop owners currently awaiting resolution through arbitration.

Further your Company is making efforts positively to conclude all the legal cases and henceforth in many cases the Company has reached the suitable amicable settlements with most of the parties. In addition renovation has started in 8 shops of Shopping Arcade.

Restructuring Plan

The Covid-19 situation, had adversely impacted the performance of the Company, which resulted in cash flow constraints. Subsequently, the Board of Directors of the Company in 2020-21 considered, and approved the submission of draft restructuring plan to its bankers.

The company filled application regarding OTR of its credit facilities with all the lenders, subsequently invocation of OTR was done on 09th Dec 2020 and Inter creditor agreement was signed on 23rd December 2020 by all the lenders.

Further, to the amended terms of OTR, the Company executed and implemented a Master Amendment Agreement on 7th June, 2021, which forms an integral part of the OTR scheme. Pursuant to the Master Amendment Agreement the lenders agreed that there shall be a moratorium on any instalments due and payable by the Company to lenders for the period between 1st September, 2020 and 30th March, 2022.

However, during the moratorium period few banks declared the Company as NPA, this act of the banks were challenged by the Company before the High Court of Delhi. Subsequently, the Honble Delhi High Court has stayed the illegal declaration of the Companys account as NPA. The stay granted by the High Court has now been extended to all other lenders of the Company. The High Court has also stayed any recovery action against the Company by any banks.

The Company also received Recall Notices issued by other lenders and also challenged those Recall Notices. The Court by order dated 2nd March 2023 has restrained each of the lenders of the Company from initiating any action to recover any amounts from the Company. This order is also still in force as on date.

There are certain impediments in the OTR compliance which is being considered at the Joint Lenders Meeting (JLM). These factors and expected future improvement in business operations will be critical for the Company to continue as a Going Concern.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

During the year under review or between the end of that financial year and the date of this report, no significant or material orders were passed by the Regulators or Courts or Tribunals which may impact the going concern status and future operations of the Company.

FOREIGN EXCHANGE RECEIPTS

The Companys earnings in foreign exchange for the year under review amounted to Rs. 4517.18 lakhs as compared to Rs. 1603.72 lakhs during the previous financial year.

CAPITAL STRUCTURE

The Authorised Share Capital of the Company is Rs. 70,00,00,000 (Rupees Seventy Crores Only) divided into 4,00,00,000 equity shares of Rs. 10 each and 3,00,00,000 preference shares of Rs. 10 each. The Issued/ Subscribed and Paid up share capital of the Company, as on 31st March, 2023, was Rs. 19,45,32,290 divided into 1,94,53,229 equity shares of Rs. 10 each.

There is no change in the Companys capital structure since the last report.

During the year under review, the Company has neither issued equity shares with differential rights as to dividend, voting or otherwise, nor has it issued shares to its employees under any scheme (including sweat equity shares). The Company does not have any outstanding warrants/depository receipts/other convertible securities as on 31st March, 2023 or the date of this report.

The shares are actively traded on BSE and NSE and have not been suspended from trading.

UN-CLAIMED SHARES

There are no shares in the Demat suspense account or unclaimed suspense account of the Company.

During the year under review, no shares in respect of which dividend remained unpaid/unclaimed consecutively for a period of seven years were transferred to IEPF Authority in accordance with Section 124(6) of the Act read with the Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended or re-stated from time to time.

PROMOTERS

The Company was promoted by the Jatia Group, comprising inter-alia, Mr. Shiv Kumar Jatia, Mr. Amritesh Jatia and in turn the companies held by them namely Fineline Holdings Ltd., Mauritius, Yans Enterprises (H.K.) Ltd., Mauritius and Asian Holdings Pvt. Ltd. Such persons directly or indirectly own and control various operating companies of the Jatia Group viz. Asian Hotels (North) Limited and Leading Hotels Limited. All the said constituents singularly and collectively, including the operating companies comprise the Jatia Group. Some of the said constituents exercise control over the Company as directors and/or shareholders.

Presently, the promoters and promoter group stake stands at 50.69% of the total paid-up capital.

SUBSIDIARIES

Your Company holds 100% equity as well as preference capital in Fineline Hospitality and Consultancy Pte. Ltd., Mauritius (FHCPL). FHCPL holds 80% equity stake in Lexon Hotel Ventures Ltd., Mauritius (Lexon), and Lexon in turn holds 99.76% equity stake in Leading Hotels Limited (Leading), an Indian subsidiary.

Thus, FHCPL has 79.81% economic interest in Leading.

It may be noted that FHCPL and Lexon are not a material subsidiary of Asian Hotels (North) Limited.

Further your Directors may inform you that under the provisions of the Mauritius Law, FHCPL a wholly owned subsidiary and Lexon, a step down subsidiary of the Company, are under the process of liquidation. Lexon is a 80% subsidiary of FHCPL. Since Lexon was the only asset under FHCPL and under liquidation, liquidation proceedings were also initiated for FHCPL.

In respect of ultimate subsidiary company, i.e., Leading Hotels Limited, an Order under section 7 of Insolvency & Bankruptcy Code 2016, read with rule 4 of the Insolvency & Bankruptcy (Application to Adjudicating Authority) Rules, 2016 passed on June 25, 2021 for initiating Corporate Insolvency Resolution Process (CIRP).

During the year under review, no company became a subsidiary or joint venture or associate of the Company. Similarly, no company ceased to be a subsidiary or joint venture or associate during the year under review.

Performance and financial position of the subsidiaries

The subsidiaries of the Company namely Fineline Hospitality and Consultancy Pte. Ltd., Mauritius (FHCPL) and Lexon Hotel Ventures Ltd., Mauritius (Lexon) have been admitted for liquidation under the provisions of Mauritius Law. Accordingly, the Consolidated Financials are not required to be prepared and therefore the Statement containing salient features of the financial statements of Companys subsidiaries in Form AOC-1 pursuant to Section 129(3) of the Act read with Rule 5 of the Companies (Accounts) Rules, 2015 is not annexed to the financial statement as it is not applicable on the Company.

STATUTORY AUDITORS & THEIR REPORT

M/s. V.V. Kale & Company, Chartered Accountants (Firm Registration Number: 000897N), were appointed as the statutory auditors of the Company in the 39th Annual General Meeting to hold office from the conclusion of that meeting till the conclusion of the 44th Annual General Meeting of the Company.

The Statutory Auditors Report for FY 2022-23 is self-explanatory and does not contain any qualification, reservation or adverse remark or disclaimer, the same forms part of this Annual Report.

No frauds have been reported under Section 143(12) of the Act by the Auditors of the Company.

INTERNAL FINANCIAL CONTROLS OVER FINANCIAL REPORTING

The Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2023 based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.

In the opinion of the Statutory Auditors of the Company, as expressed by them in their report, the Company has adequate internal financial control systems over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2023.

INTERNAL AUDITORS

During the year under review, M/s. Virendra & Associates, Chartered Accountants, New Delhi, the internal auditors of the Company conducted periodic audits of the Company. The Audit Committee reviews the detailed Internal Audit reports submitted by the Internal Auditors and takes note of the actions taken on the observations and recommendations made by them.

Your Directors are confident that there are adequate internal financial control systems and procedures which are being followed and complied with.

No frauds have been reported under Section 143(12) of the Act by the Internal Auditors of the Company.

SECRETARIAL AUDITORS & THEIR REPORT

M/s. Chandrasekaran Associates, Company Secretaries, the Secretarial Auditors of the Company, have submitted their report for the financial year ended on 31st March, 2023 which is annexed as Annexure ‘A and forms part of this Report.

Secretarial Auditors in their Report dated 26th May, 2023, has expressed qualified opinion in respect of the following points and the management reply are also mentioned below correspondence to that points:

1. As on 31st March, 2022, the Company falls under the category of top 2000 listed entities on the basis of market capitalization and consequent upon the resignation of Mr. Rajeev Uberoi, the Company is not having minimum number of Directors as prescribed in Regulation 17(1)(c) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 from 10.04.2022 till 06.07.2022.

Management Reply: The casual vacancy arised due to resignation of Mr. Rajeev Uberoi, Independent Director which was filled within 3 months from the date of resignation. Since then the minimum number of Directors are as per the prescribed limit. Company has adhered to the optimum combination of Board of Directors as per Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

2. Since Company does not have any regular non-executive chairperson and consequent upon the resignation of Mr. Rajeev Uberoi, Independent Director, the minimum number of Independent Director on the Board of the Company falls below prescribed limit as per Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, from 10.04.2022 till 06.07.2022.

Management Reply: The casual vacancy arised due to resignation of Mr. Rajeev Uberoi, Independent Director which was filled within 3 months from the date of resignation. Since then the Independent Directors are as per the prescribed limit. Company has adhered to the optimum combination of Board of Directors as per Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

Further, no frauds have been reported under Section 143(12) of the Act by the Secretarial Auditors of the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review, Mr. Rajeev Uberoi, Director (DIN: 01731829) due to his professional preoccupation resigned from the office of Director of the Company with effect from 10th April, 2022.

During the year under review, Ms. Saumya Goel, Company Secretary and Compliance Officer (KMP) resigned from the Company with effect from 20th May, 2022.

During the year under review, Ms. Mita Namonth Jha, Director (DIN: 07258314) appointed as an Additional Director in the category of Independent Director of the Company to hold office upto date of forthecoming AGM with effect from 7th July, 2022.

During the year under review, Mr. Tarun Srivastava appointed as Company Secretary and Compliance Officer (KMP) of the Company with effect from 9th August, 2022.

During the year under review, Mr. Amritesh Jatia, Managing Director (DIN: 02781300) was appointed as the Chairman of the Company w.e.f. 22nd September, 2022

During the year under review, Mr. Akhilesh Bhuwalka, Director (DIN: 02764273) re-appointed as Director of the Company, liable to retire by rotation.

During the year under review, Mr. Amritesh Jatia (DIN: 02781300) with the approval of shareholders, appointed as Managing Director of the Company for five years with effect from 23rd October, 2021 to 22nd October, 2026.

During the year under review, Mr. Ashish Dhanuka (DIN: 07220876), with the approval of shareholders, appointed as Director of the Company from an Additional Director.

During the year under review, Mr. Ashish Dhanuka (DIN: 07220876) with the approval of shareholders, appointed as Whole Time Director designated as Executive Director and Chief Financial Officer of the Company with effect from 23rd October, 2021 to 22nd October, 2024.

During the year under review, Ms. Preeti Gandhi (DIN: 08552402) with the approval of shareholders, re-appointed as an Independent Director of the Company with effect from 13th September, 2022 to 12th September, 2025.

During the year under review, Mr. Sanjeev Agarwala (DIN: 09342150) with the approval of shareholders, appointed as an Independent Director of the Company with effect from 4th October, 2021 to 3rd October, 2023.

During the year under review, Ms. Mita Namonth Jha (DIN: 07258314) with the approval of shareholders, appointed as an Independent Director of the Company with effect from 7th July, 2022 to 6th July, 2023.

Further the Board of Directors of the Company has recommended the re-appointment of Ms. Mita Namonth Jha (DIN: 07258314) as an Independent Director of the Company for term of six months with effect from 7th July, 2023 subject to the approval of the shareholders at the 42nd AGM.

During the year under review, except as stated above, there was no change in the Directors or Key Managerial Personnel of the Company

DIRECTORS RESPONSIBILITY STATEMENT UNDER SECTION 134(5) OF THE COMPANIES ACT, 2013

Pursuant to Section 134(5) of the Act, your Directors confirm as under:

- that in the preparation of the annual accounts for the year ended 31st March, 2023, the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

- that the Directors have selected such accounting policies and 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 at the end of the financial year under review and of the loss of the Company for that year;

- that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

- that the Directors have prepared the annual accounts for the Financial year ended 31st March, 2023 on a going concern basis;

- that the Directors have laid down internal financial controls that are being followed by the Company and that such internal financial controls are adequate and are operating effectively; and

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

Significant accounting policies followed by the Company, and the required disclosures are detailed in the Notes to the Financial Statements. Further, applicable Ind AS and related presentation and disclosure norms have been complied with.

INFORMATION REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO

The information required in terms of Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, pertaining to the conservation of energy, technology absorption and foreign exchange earnings and outgo, to the extent possible in the opinion of your Directors, and forming part of this Report, is given in Annexure ‘B.

PARTICULARS OF EMPLOYEES & DISCLOSURES UNDER SECTION 197(12) OF THE ACT READ WITH RULE 5 OF THE COMPANIES (APPOINTMENT & REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

The information pursuant to Section 197(12) of the Act, read with Rules 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of directors, key managerial personnel and employees of the Company is given in Annexure ‘C and Annexure ‘D respectively, and forms part of this Report.

CORPORATE GOVERNANCE

Save as otherwise stated above, the Company has complied with the requirements of corporate governance as stipulated in the Listing Regulations.

Pursuant to the provisions of the Listing Regulations, the Corporate Governance Report, together with the Auditors Certificate thereon, is annexed hereto as Annexure ‘E and Annexure ‘F respectively.

CORPORATE SOCIAL RESPONSIBILITY

Due to heavy losses incurred by the Company since FY 2014-15, the Company was not obliged to make any contribution towards CSR activities from the financial years 2014-15 to 2022-23 as per Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014.

During the year, Board of Directors dissolved the Corporate Social Responsibility Committee (CSR Committee) in its meeting held on 28th May, 2022 and the Corporate Social Responsibility (CSR) policy is no longer effective. Henceforth the requirement of attachment of details about the policy developed and implemented by the Company on Corporate Social Responsibility initiatives taken during the year is no longer applicable to the Company.

RISK MANAGEMENT

The Company has a well-defined Risk Management framework, which is designed to enable risk to be identified, assessed and mitigated appropriately. This framework seeks to create transparency, minimize adverse impact on business objective and enhance Companys competitive advantage. The Company is faced with different types of risks, each risk is carefully mapped and each of such risk requires different approaches for mitigation. The Risk Management Policy lays down the process for identification and mitigation of risks. The policy is available on the website of the Company and can be assessed at http://www.asianhotelsnorth.com/pdf/RiskManagementPolicv11082011 8Sep2021.pdf

Further, based on the market capitalization of the Company, the provisions relating to the formation of a Risk Management Committee is not applicable to the Company.

MEETINGS OF THE BOARD OF DIRECTORS

During the year under review, Four (4) Board meetings were held, details of which are given in the Corporate Governance Report annexed to this Report as Annexure ‘E.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations. The Company has established a vigil mechanism and the Board of Directors of the Company had approved and adopted a Whistle Blower Policy which is uploaded on the website of the Company and can be accessed at http://www.asianhotelsnorth.com/pdf/WhistleBlowerPolicyefl:ective01042019.pdf

The Whistle Blower Policy provides that all employees and directors of the Company are eligible to make protected disclosures to the competent authority i.e. the Chairman of the Audit Committee with respect to any improper activity concerning the Company. The policy provides for direct access to the Chairman of the Audit Committee. 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.

During the year under review, neither any case was reported under the Whistle Blower Policy nor was anyone denied access to the said competent authority or the Audit Committee.

ANNUAL RETURN

In terms of Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return of the Company is available on the website of the Company and can be accessed at https://www.asianhotelsnorth.com/annual-returns.html

The aforesaid Annual Return will be filed with the Ministry of Corporate Affairs post annual general meeting, within the prescribed timelines in prescribed form MGT-7 (including form MGT-8). Thereafter, the final Form MGT-7 and Form MGT-8 would be uploaded on the Companys website at the above mentioned link.

BOARD EVALUATION

Annual evaluation of the performance of the Board, its Committees and of individual directors has been made by the Board. The Board followed the following mechanism for evaluating the performance of the Board, its Committees and individual directors including the Chairman and independent Directors of the Company:

a. the Independent Directors through their exclusive meeting evaluate the performance of Non-Independent Directors, the Chairman and the Board as a whole;

b. the Nomination and Remuneration Committee considers the views of the Independent Directors through their exclusive meeting regarding the performance of Non-Independent Directors and based there-upon makes its recommendations to the Board about their performance;

c. the Nomination and Remuneration Committee evaluates the performance of Independent Directors and makes its recommendations to the Board about their performance; and

d. the Board finally evaluates the performance of all individual directors, the Chairman, the Board as a whole and Committees of the Board thereof. While evaluating the performance of the Board, it considers the views of the Independent Directors through their exclusive meeting.

The Board of Directors of the Company has in place an evaluation criteria for assessment of its own performance, that of the committees of the Board and the individual directors. Leadership abilities, understanding the business dynamics, strategic planning for sustainable growth and protection of minority shareholders interest are the essential criteria of the performance evaluation of the Directors.

The Board in its meeting held on 29th May, 2023, has discussed its overall performance and concluded that the Board and its Committees have been performing satisfactorily. Further, based on the feedback received from fellow directors, the Board also evaluated the performance of the individual directors (including the Chairman) and found it satisfactory.

The details of the evaluation criteria are enumerated in the Nomination, Remuneration and Evaluation Policy which can be accessed at: http://www.asianhotelsnorth.com/pdf/NominationRemunerationandEvaluationPolicvefl:ective01042019.pdf

DECLARATION BY INDEPENDENT DIRECTORS

During the year under review, all the Independent Non-executive Directors have confirmed and submitted declaration to the effect that they meet the criteria of independence as laid down under Section 149 and 150 of the Act read with rules framed thereunder and other applicable provisions of the Act read with relevant regulations of the Listing Regulations. Independent Non-Executive Directors have also submitted declarations for the financial year 2023-24 confirming that they continue to meet the criteria of independence as laid down under aforesaid provisions.

Further, they have confirmed that they have obtained registration with the Indian Institute of Corporate Affairs as an Independent Director and such registration continues to be valid; and that they shall ensure renewal of such registration within a period of thirty days from the date of its expiry, as applicable; and that they shall pass the Online Proficiency Self-Assessment Test conducted by the abovenamed institute within a period of two years from the date of inclusion of their respective names in the databank, if applicable, in pursuance of Section 150 of the Act read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and the Companies (Creation and Maintenance of Databank of Independent Directors) Rules, 2019.

Further, in terms of Regulation 25(8) of the Listing Regulations, they have confirmed that they are not aware of any circumstance or situation which exists or may be reasonably anticipated that could impair or impact their ability to discharge their duties with an objective of independent judgment and without any external influence.

Reliance was placed on these confirmations/declarations while ascertaining the adequacy of number of independent directors for the purposes of compliance with Regulation 17 and other applicable regulations of the Listing Regulations.

All the Independent Directors have also confirmed that they have complied with the Companys code of conduct. Based on the declarations received, in the opinion of the Board, all the independent non-executive directors fulfill the conditions specified under Section 149 of the Act and the Listing Regulations, as amended, and that they are independent of the management. The Board also recommends their continued association with the Company as an independent directors.

In the opinion of the Board of Directors of the Company, all Independent Directors of the Company possess requisite expertise and experience (including the proficiency) and are the person of high integrity and repute as prescribed under section 149(6) of the Act and the Companies (Appointment and Disqualification of Directors) Rules, 2014 read with the Companies (Accounts) Rules, 2014 (including amendment thereof).

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts, arrangements or transactions entered in to by the Company during the financial year 2022-23, were in the ordinary course of business and were at an arms length basis. Relevant Related Party Disclosures under the provisions of the Act and the Listing Regulations, as applicable, are provided in the Note no. 39 to the financial statements.

For all foreseeable repetitive related party transactions, prior omnibus approval of the Audit Committee is obtained as per applicable laws, on yearly basis, considering that such approval is in the interest of the Company.

During the year under review, the Company had not entered into any contract, arrangement or transaction with related parties which could be considered material in accordance with the Companys policy on materiality of related party transactions read with the provisions of the Listing Regulations. Accordingly, there are no transactions which are required to be reported in Form AOC-2 in pursuance of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014.

The Policy on the related party transactions is available on the Companys website at

https://www.asianhotelsnorth.com/pdf/FY2223/Policv%20for%20Related%20Partv%20Transactions%20as%20on%2001.04.2022.pdf

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Your Company has not given any Loans, Guarantees or made any investments under the provisions of section 186 of the Companies Act, 2013 during the year under review.

NOMINATION, REMUNERATION AND EVALUATION POLICY

The roles, responsibilities, powers and terms of reference of the Nomination and Remuneration Committee were in conformity with Section 178 of the Act and Rules made there-under, and Regulation 19 of the Listing Regulations and relevant Schedule thereto, as amended or re-stated from time to time, during the year under review. Moreover, the Board of Directors has ensured that the said policy enumerates the criteria laid down for nomination/selection, appointment, evaluation and remuneration of the directors and key managerial personnel; and determines qualifications, positive attributes and independence of directors and/or key managerial personnel, and is uploaded on the website of the Company at https://www.asianhotelsnorth.com/pdf/ NominationRemunerationandEvaluationPolicyeffective01042019.pdf

The salient features of the said policy are as under:

a) Role of the Nomination and Remuneration Committee

• Ensure diversity of Board;

• Formulate criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board their appointment;

• Identify persons who are qualified to become Directors and/or Senior Management Personnel (SMP) and recommend to the Board their appointment;

• Recommend to the Board a remuneration policy for the directors, key managerial/senior management personnel; and

• Specify the manner for effective evaluation of performance of the Board, its committees and each category of directors

b) Appointment of Directors/KMPs/SMPs as per criteria set-out in the Nomination, Remuneration and Evaluation Policy

c) Guiding principles for quantum and composition of remuneration, remuneration structure for whole-time directors and nonexecutive directors

d) Criteria for evaluation of performance of whole-time directors, non-executive directors and independent non-executive directors

COMMITTEES OF THE BOARD

The Company has following committees, which have been established as a part of the corporate governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Corporate Social Responsibility Committee (dissolved w.e.f. 28th May, 2022)

The details with respect to the compositions, powers, roles, terms of reference and number of meetings held during the year of relevant committees are given in detail in the Corporate Governance Report of the Company, which forms part of this Directors Report.

CHANGE IN THE NATURE OF BUSINESS

During the year under review, there has been no change in the nature of business of the Company.

DEPOSITS

During the year under review, the Company has not invited or accepted or renewed any deposits covered under section 73 of the Companies Act, 2013 and the Rules made thereunder. Further, no amount of principal or interest are outstanding at the end of financial year 2022-23.

LISTING ON STOCK EXCHANGES

The equity shares of the Company are listed on The National Stock Exchange of India Limited and BSE Limited. Further, your Directors would like to inform that the Company has paid up to date Annual Listing Fees to the respective Stock Exchanges.

SECRETARIAL STANDARDS

The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

MAINTENANCE OF COST RECORDS

The Company is not required to maintain cost records as per sub-section (1) of Section 148 of the Companies Act, 2013.

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Para B of Schedule V to the Listing Regulations, the Management Discussion and Analysis Report is given below:

INDUSTRY STRUCTURE & DEVELOPMENTS AND OPPORTUNITIES & OUTLOOK

The Indian economy is expected to grow at 5.9% during the year 2023-24, while the global growth is estimated to be 3.0% in 2023 and 2024 according to a report by the International Monetary Fund.

The Indian hospitality sector is expected to witness high growth over the long term. Domestic travel, high disposable income and the advent of better locations are expected to drive this growth. India is expected to have 1,00,000 start-ups by the year 2025 which will not only create employment for millions of people, but also provide an impetus to business travel and related events. The travel market in India is projected to reach US$ 125 billions by FY 2027 from an estimated US$ 75 billion in FY 2020. International tourist arrivals are expected to reach 30.5 million by 2028.

The Indian tourism and hospitality industry has emerged as one of the key drivers of growth among the services sector in India. Tourism in India has significant potential considering the rich cultural and historical heritage, variety in ecology, terrains and places of natural beauty spread across the country. Another factor is Indias emergence as a destination to avail world class medical facilities at competitive cost.

Tourism is also a potentially large employment generator besides being a significant source of foreign exchange for the country.

The deepening penetration of internet usage and smart phones in India has led to increased booking of hotels through online portals and applications in recent times. This is also expected to significantly enlarge the size of the Indian online hotel industry in the coming years.

Travel and tourism are two of the largest industries in India, with a total contribution of about US$ 178 billion to the countrys GDP.

The hotel industry in India is significantly under-served. Various policies are being introduced to promote the tourism and hospitality sectors to meet the demand of new tourists in the coming years. US$ 2.1 billion is allocated to Ministry of Tourism in budget 2023-24 as the sector holds huge opportunities for jobs and entrepreneurship for youth. Under the Union Budget 2023-24, an outlay of US$ 170.85 million has been allocated for the Swadesh Darshan Scheme. 68 destinations/sites have been identified in 30 States/UTs for development under the PRASHAD Scheme as on March 31, 2022.

According to World Travel and Toursim Council (WTTC), India is ranked 10th among 185 countries in terms of travel & tourisms total contribution to GDP in 2019. During 2019, contribution of travel & tourism to GDP was 6.8% of the total economy, Rs. 1,368,100 crore (US$ 194.30 billion). In 2020, the Indian tourism sector accounted for 39 million jobs, which was 8% of the total employment in the country.

In 2021, the travel & tourism industrys contribution to the GDP was US$ 178 billion; this is expected to reach US$ 512 billion by 2028. In India, the industrys direct contribution to the GDP is expected to record an annual growth rate of 7-9% between 2019 and 2030. In 2020, the travel & tourism industrys contribution to the GDP was US$ 121.9 billion.

The travel market in India is projected to reach US$ 125 billion by FY27 from an estimated US$ 75 billion in FY20. The Indian airline travel market was estimated at US$ 20 billion and is projected to double in size by FY27 due to improving airport infrastructure and growing access to passports. The Indian hotel market including domestic, inbound and outbound was estimated at US$ 32 billion in FY20 and is expected to reach US$ 52 billion by FY27, driven by the surging demand from travellers and sustained efforts of travel agents to boost the market.

By 2028, international tourist arrivals are expected to reach 30.5 billion and generate revenue over US$ 59 billion. However, domestic tourists are expected to drive the growth, post pandemic. International hotel chains are increasing their presence in the country, and it will account for around 47% share in the tourism and hospitality sector of India by 2020 and 50% by 2022.

As per the Ministry of Tourism, Foreign Tourist Arrivals (FTAs) in February 2023 were 865,779 with a positive growth rate of 259.4% as compared to 240,896 in February 2022.

FTAs during the period January-February 2023 were 1,733,939 as compared to 442,442 in January-February, 2022.

The percentage share of Foreign Tourist Arrivals in India during February 2023 among the top 15 source countries was highest from Bangladesh (20.3%) followed by the USA (16.4%), UK (11.1%), Canada (5.8%), Australia (3.7%), Malaysia (3.0%), Sri Lanka (2.8%), Russian Federation (2.7%), Germany (2.5%), France (2.4%), Nepal (1.9%), Thailand (1.7%), Singapore (1.5%), Italy (1.2%) and Japan (1.2%).

THREATS, RISKS AND CONCERNS

Rapidly changing customer demands and a boom in guest-facing connected technologies are among the factors changing the risk landscape for hospitality companies. Travel and hospitality is a lucrative industry. Over the years, the industry witnessed a tremendous rise in business. However, despite the gains, inevitable challenges in the accommodation sector make running hotel businesses a little more difficult.

Talent management is a major challenge for the hospitality sector. Every hotel requires quality staff on all fronts; be it administration, maintenance, kitchen, housekeeping, or frontdesk. Lack of skill in the educated youths graduating from education houses is also proving to be a major challenge in the hotel industry.

Price inflation of daily use products, eatables, and other supplies has risen steeply in the last few years. While that has affected all industries, it takes a huge portion of the issues and challenges faced by the tourism and hospitality industry.

Another increased threat in the Industry is the Security threat. While our data security methods have advanced considerably, so have the possibilities of data leaks and virus attacks. Threats of digital data theft and confidential data leaks are a matter of concern for hoteliers globally.

These days, more and more property owners are renting out their rooms or property occasionally. Homestays and vacation rentals promise an authentic local experience besides being convenient. Owing to this, travelers prefer to choose those homestays over hotels and resorts. Other than that, new hotels are entering the market every day. This growing number of homestays and competition is one of the challenges in the hospitality industry.

Every industry is prone to challenges and pitfalls, and the hospitality industry is no exception.

The last couple of years is accurate proof of it. But that same period is also proof that theres nothing the industry cant overcome. The way the industry has got back on its feet is indeed commendable.

COMPANYS STRATEGY FOR SUSTAINED GROWTH IN MEDIUM TO LONG TERM

For the sustained growth of an organization, it is imperative that the Company keeps exploring newer opportunities of growth either through expansion or venturing into new projects. Few of the major focus and attention is on the following:

• Confirmation of minimum one head of state for the G20 summit in September along with other high paying delegations from GCC Countries.

• Identification of EMC/PCOs to be targeted for Pharma/Automobile/Medical/Sports associations events in Quarter 3 & 4 2023 as per city calendar.

• Target on Tourism Boards / Airline/Cruise events for Q4 and Q1 next year.

• Continued focus on Diplomatic community and Ministry to capture future visits and delegation - Confirmed business from Ministries, Embassies, other corporate group. Pipeline from World Health Organization and International Labour Organization.

• Focus to increase on PSU accounts, Gurgaon market. Touch base with all LNR contracted companies for next year.

• Identification of Wedding planners across PAN India, targeting higher APC by selling at minimum revenue. Focus to be on Residential weddings on all auspicious dates. We are working on intercultural weddings on non Saya dates.

• High focus to increase penetration from OTAs through online presence at an optimum price mix data.

• Identification of long staying and regular accounts of Competition hotels, to focus on immediate basis.

REVIEW OF OPERATIONAL AND FINANCIAL PERFORMANCE

The Company achieved aggregate revenue of Rs. 25,577.99 lakhs from operations for the year ended 31st March, 2023. The said revenue in the prior year was Rs. 13,052.54 lakhs. Detailed discussions are given under Financial Results & the State of Companys Affairs herein-above.

SIGNIFICANT CHANGES IN KEY FINANCIAL RATIOS

Key financial ratios for the year under review vis-a-vis prior year are as under:

Key Financial Ratio FY 2022-23 FY 2021-22
Operating Profit Margin (%) 21.27 4.60
Net Profit Margin (%) (32.95) (92.72)
Debtors Turnover 23.00 18.16
Inventory Turnover 34.51 23.31
Current Ratio 0.10 0.07
Debt Equity Ratio 6.66 4.32
Interest Coverage Ratio 0.14 0.02
Return on Net Worth (%) (52.23) (50.50)

Remarks for change in ratio by more than 25% with respect to previous year:-

Operating Profit Margin Ratio

There is improvement in ratio as there is recovery in business during FY 2022-23.

Net Profit Margin Ratio

Ratio is adverse due to losses incurred by company. There is improvement in ratio as company has made operational profit during the year.

Debtors Turnover Ratio

Ratio has become more favorable as compared to previous year because last year due to COVID- 19 pandemic operations of hotels & restaurants halted for some months which resulted in delay in collection from corporate clients.

Inventory Turnover Ratio

Ratio has become more favorable as compared to previous year because last year due to COVID- 19 pandemic operations of hotels & restaurants closed for substantial period during year which resulted in ineffective utilization of inventory.

Current Ratio

There is improvement in ratio due to increase in current assets as there is improvement in business operations.

Debt-Equity Ratio

Ratio is adverse because of continuous increase in Debts (due to capitalization of Interest & Creation of FITL) and decrease in Equity due to continuous loss.

Interest Coverage Ratio

Ratio is adverse as company unable to generate enough cash to service its outstanding Debts. There is improvement in ratio due to recovery in the business.

Return on Net Worth Ratio

Ratio is marginally adverse as company has continuously suffered losses from previous years.

SEGMENT WISE PERFORMANCE

During the year under review, the Company operates only in one major reportable segment, i.e. Hospitality / Hotel Business. Other business segments i.e. power generation operations & Real Estate operations are governed by different set of risks and returns. However, the respective revenue streams and net profit / (loss) related to those segments though not material for disclosure purposes as separate reportable segment, but, as per condition laid down by Lenders of the Company in One Time Restructuring (OTR) Scheme requires a separate disclosure. Accordingly, in compliance with conditions laid down by the said lenders, the Company has done Segment reporting for Hospitality / Hotel Business, power generation operations & Real Estate operations.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has standard operating procedures for each operational area. It has in place adequate reporting systems in respect of financial performance, operational efficiencies and reporting with respect to compliance of various statutory and regulatory matters. As detailed above, the Internal Auditors have regularly conducted exhaustive audits pertaining to different operational areas and their reports detailing their findings and observations were periodically placed before the Audit Committee. The Audit Committee also takes status of the actions taken on the observations of and recommendations made by the Internal Auditors.

The Company has in place adequate internal controls and systems and these are operating effectively.

HUMAN RESOURCES AND INDUSTRIAL RELATIONS

An organizations success depends largely on its human resources, its management and good industrial relations. Your Company has always viewed human resource development as a critical activity for achieving its business goals. The Company has maintained cordial industrial relations during the year, and continued to provide comprehensive welfare facilities to its employees to take care of their health, efficiency, economic betterment, etc. and to enable them to give their best at the workplace. It has always supported participative culture in the management of the enterprise through a consultative approach with the collectives, establishing a harmonious relationship for industrial peace leading to higher productivity. Employees participation is also ensured through information-sharing with collectives and employees on a regular basis while seeking their support, suggestions and cooperation.

The Company has in place a Policy against Sexual Harassment and has also formed an Internal Complaints Committee (ICC) in compliance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the year under review, no complaint was received or outstanding at the end of the year under review in pursuance of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company enjoys harmonious relationship with its employees. The Company had 644 employees on its rolls as on 31st March, 2023 (previous year end 620)

AWARDS AND RECOGNITIONS

The awards we win years after years validate our efforts and encourage us to continue to lead by example. The Hotel Hyatt Regency Delhi is recognised for its dining and entertainment experience at award-winning restaurants including: Cafe an all-day dining restaurant; The China Kitchen - the authentic Chinese restaurant; La Piazza for traditional Italian, TKs Oriental Grill serving Far East Oriental cuisine, Polo Lounge the traditional lounge bar; Latitude 66 ? the Pop-up restaurant serving innovative Indian cuisine with a select beverage list on offer and Sidewalk, the pastry and confectionary store.

The details of awards received during the year are as follows:

Times Food and Nightlife Award - Syrah - Best Middle eastern - Premium Dining restaurant Best Business Hotel - Iconic Awards

Indian Restaurant Awards - The China Kitchen - Best Independent Restaurant #3 Everyday Eats in India by Tripadvisor Travelers Choice Best of the Best Awards - Syrah HT City Hall of Fame Awards - La Piazza - Exemplary Italian Restaurant - La Piazza HT City Hall of Fame Awards - World-Class Eastern Mediterranean - Syrah HT City Hall of Fame Awards - Iconic Chinese Restaurant - The China Kitchen

DISCLOSURE OF CERTAIN TYPES OF AGREEMENTS BINDING LISTED ENTITIES

No agreement subsists as on the date of notification of clause 5A to para A of part A of schedule III of Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

PROCEEDING UNDER INSOLVENCY AND BANKRUPTCY CODE, 2016

The Company has not made any application or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) ("IBC Code") during the year. Further, at the end of the year, Company does not have any proceedings related to IBC Code, therefore the same is not applicable.

THE DETAILS OF DIFFERENCE BETWEEN AMOUNT OF THE VALUATION DONE AT THE TIME OF ONE TIME SETTLEMENT AND THE VALUATION DONE WHILE TAKING LOAN FROM THE BANKS OR FINANCIAL INSTITUTIONS ALONG WITH THE REASONS THEREOF

During the year under review, the Company has not made one time settlement therefore, the same is not applicable.

ACKNOWLEDGEMENT

Your Directors place on record their sincere appreciation and gratitude to the Companys valued customers, the Government of India, State Government of Delhi, and the Financial Institutions and Banks for their continued support and confidence in the Company.

Your Directors also place on record their sincere gratitude to Hyatt International for their co-operation and guidance. Your Directors also commend the sincere efforts put in by the employees at all levels for the growth of the Company.

For and on behalf of
Asian Hotels (North) Limited
Ashish Dhanuka Amritesh Jatia
Place : New Delhi Executive Director & CFO Chairman and Managing Director
Dated: 10th August, 2023 DIN:07220876 DIN:02781300

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