hemisphere properties india ltd share price Directors report


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<dhhead>BOARD’S REPORT</dhhead>

Dear Members,

Your Directors have pleasure in presenting the 19 th Annual Report together with the Audited Financial Statements of your Company for the financial year ended on March 31, 2023.

1. PERFORMANCE HIGHLIGHTS

1.1 Summary of performance

The highlights of performance of your Company for the financial year 2022-23, with comparative position of previous year’s performance, were as under:

Rs. in lakhs

Financial Results

(

Financial Year 2022-23

Financial Year 2021-22

( Rs.)

( Rs.)

Revenue from operations

200.20

-

Other income

652.64

315.98

Total Income

852.84

315.98

Expenses

1653.85

2179.84

Net Profit/Loss (before tax)

: (801.01)

(1863.86)

Current Tax

-

-

Deferred Tax

(153.70)

(377.81)

Net Profit/(Loss) after tax

(647.31)

-(1486.05)

1.2 Financial performance & State of Affairs of the Company

This year your Company recorded net loss of Rs 647.31 lakhs as against the loss of Rs. 1486.05 lakhs during the previous financial year. The Company is in loss due to steady revenue generation in the Company. The detailed expenditures incurred during the year can be seen on the Financial statements annexed to this report.

The Company has initiated generation of activities for generation of income from available resources. The Company has generated income from rentals in financial year 2022-23 is Rs. 200.20 lakhs.

The Company has initiated the activities for Pune Land parcel and approval with several Competent Authorities is pending for Chattarpur land. The Company is working to utilise the land parcel of total 739.69 acres located in 4 states and 5 locations in India.

1.3 Business Performance

The objective of is to construct, acquire, hold, manage, develop, administer, protect, reserve and to deal in any other manner with properties, including sale and purchase thereof, whether such properties are in the nature of land or building (semi-constructed or fully constructed) or partially land and partially buildings, anywhere in India. The intent of incorporation of your Company is to transfer the surplus land of erstwhile Videsh Sanchar Nigam Limited into your Company and develop these land under the objectives set out Memorandum of Association.

Objects of our Company covers follows:

1. To construct, acquire, hold, manage, develop, administer, protect, reserve and to deal in any other manner with properties, including sale and purchase thereof, whether such properties are in the nature of land or building (semi- constructed or fully constructed) or partially land and partially buildings, any where in India and if permitted by applicable legislations, outside India as well.

2. To collect and settle revenue, rental, lease charges and such other charges as may be payable by any entity against legitimate use of such properties by persons, companies, agencies and administrations for the services provided and to utilise the same for furtherance of activities of the Company.

3. To carry out business of developing, holding, owing, leading or licensing real estate, consultancy in real estate and property of all kinds and for this purpose acquiring by purchase or through lease, license, barter, exchange, hire purchase or otherwise, land or other immovable property of any description or tenure or interest in immovable property.

4. To carry out the business of building construction and development of commercial building, industrial shed, offices, houses, buildings, apartment, structures, hotels or other allied works of every description on any land acquired howsoever by the company, whether on ownership basis or as a lessee or licensee and to deal with such construction or developed or built premises by letting out, hiring or selling the same by way of outright sale, lease, license, usufructuary mortgage or other disposal of whole or part of such construction or development or built premises.

The Company in pursuant to the order passed by National Company Law Tribunal and Ministry of Corporate Affairs in August, 2019 transferred with the 739.69 acres of land located in Delhi, Pune, Chennai and Kolkata. The Company on the recommendations in Due Diligence report further advertised to ascertain the market demand of farmhouses in Chattarpur land parcel of 58 acres the application for approval of change in permissible land use pending with the Competent Authority. During the period under review, the company has updated its land records for Chattarpur land parcel with Municipal Corporation of Delhi.

Further to generate revenue, the Company empanelled Real Estate Companies for providing Transaction Advisory Services to Company. The Company is floating Request for Proposal for engaging Transaction advisor in Pune Land parcel.

HPIL during the year is receiving rental income from Tata Communications Limited, STT Global, Data Centre for using land in Pune for access.

Further, there are two Building located in Pune, which are under renovation for realising immediate rental incomes.

The Company during the period under review completed the mutation for Pune Land Records and Chennai Land parcel. The stamp duty of Rs. 7.73 crores has been paid for Chennai land parcel and the updation in Land records is pending with Competent Authority of Padianullur, Chennai.

The application for Kolkata mutation has been filed and is with concerned Block Land Records Office.

The Company in May, 2022 conducted the valuation of land parcels of Company through Insolvency and Bankruptcy Board of India, Registered Valuers. It is informed that the rate is as per the fair market value based on various approved valuation approaches. The valuation is as under:

S.No. Land

Fair Value( Rs. in crores)

1 Padianullar, Chennai

417.16

2 Halisahar, Kolkata

90.25

3 Dighi, Pune

2,263.99

4 Greater Kailash, New Delhi

7,101.94

5 Chattarpur, New Delhi

728.63

Total

10,601.97

2. TRANSFER TO RESERVES

During the year under review, no amount has been transferred to General Reserve.

3. DIVIDEND

Due to losses incurred by the company, the directors do not recommend any dividend payable to the shareholders for the year ended March 31, 2023.

4. CAPITAL EXPENDITURE

Capital Expenditure of Rs. 68.51 lakhs approx. was incurred during the year mainly on maintain the land.

5. SHARE CAPITAL

The authorized share capital of the Company was Rs. 100,000,000,000 (Rupees Ten Thousand Crores only) of Rs. 10/- (Rupees 10)each under which 9,000,000,000 (Nine Hundred Crore) are Equity shares and 1,000,000,000 (One Hundred Crore) Preference shares as on March 31, 2023.

During the year, there is no change in paid up Share Capital of Company which is Rs. 415,00,00,000 (Rupees Four Hundred and Fifteen Crores only)

The Company has 13 crore 0.01% Non-Cumulative Redeemable Preference shares of Rs. 10 each to the Promoter i.e President of India acting through Ministry of Housing & Urban affairs in Board meeting held on 17.05.2021 and 12.11.2021.

The Listed Equity Paid up share capital of Company is Rs. 285,00,00,000 (Rupees Two Eighty Five Crores only) of 28,50,00,000 (Twenty Crore Fifty Lakhs only) equity shares of Rs. 10/- (Rupees 10)

There is no other change in the authorized, issued, subscribed and paid-up equity share capital of the Company during the year. Further, the Company has not issued any shares with differential voting right/ Sweat Equity Shares during the year underreport.

6. LISTING OF SHARES AND PAYMENT OF LISTING FEE

The Company has paid annual listing fee for the financial year 2023-24 in respect of its equity shares listed at BSE Limited(BSE) and National Stock Exchange of India Limited (NSE).

7. TRANSFER OF UNCLAIMED DIVIDEND AND SHARES TO INVESTOR EDUCATION & PROTECTION FUND

As equity shares of the Company were got listed in October 2020, in compliance of the provisions of Section 124 and125 of the Companies Act, 2013, Company is not required to transfer any amount of dividend remained unpaid or unclaimed to Investor Education & Protection Fund (IEPF), as a period of 7 years has not elapsed from the date it became due for payment. Accordingly, no shares were required to be transferred to IEPF account.

However, the Company allotted shares to IEPF account as per the Scheme of Arrangement and Reconstruction.

8. CONTRIBUTION TO NATIONAL EXCHEQUER

During the financial year 2022-23, the Company contributed an amount of Rs. 25.99 lakhs to the National Exchequer, which included Rs. 17.60 lakhs towards direct taxes and Rs.8.39 lakhs towards GST. In the previous financial year, the total contribution to the National Exchequer was Rs. 39.27 lakhs.

9. DEPOSITS

During the year under review, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

10. CHANGE IN NAME OF THE COMPANY

During the year under review, there was no change in the name of the Company.

11.CHANGE IN THE NATURE OF BUSINESS

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

12. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE

FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

There have been no material changes and commitments, which affects the financial position of the Company, that have occurred between the end of the financial year to which the financial statements relates and the date of the report.

The Company received loan of Rs. 10 crore (Rupees Ten crore only) in Financial Year 2021-22 from the Government of India (GoI) at the suggested rate of interest by the GoI and other terms & conditions.

Besides abovementioned points, there is no material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which the financial statements relate and as on the date of this report.

13. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE

During period under review, there was not any significant and material orders passed by the regulators/courts/ Tribunal.

14. DISINVESTMENT BY GOVERNMENT OF INDIA

There was not any disinvestment by the Government of India (GOI) in the company during the financial year 2022-23.The President of India through Ministry of Housing & Urban Affairs is holding as on March 31, 2023 was 14,56,96,885 equity shares i.e. 51.12% of total paid up equity share capital of the Company.

15. PRESIDENTIAL DIRECTIVE(S)

No Presidential Directives issued by Govt. were received by HPIL during the last three years.

16.MANAGEMENT EXPLANATION ON STATUTORY AUDITOR’S REPORT

The Statutory Auditors have audited the standalone financial statements of the Company for the financial year 2022-23 and have given their report without any qualification, reservation, adverse remark or disclaimer. However, they have drawn

18. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report (MDAR) as required under Regulation 34 read with Schedule V to the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘LODR’) for the year under review, is presented in a separate section, forming part of the Annual Report as Annexure I.

19. DETAILS OF SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any Subsidiary/ Joint Venture/Associate Company hence details of financial performance of Subsidiary/ Joint Venture/Associate Company is not required to be attached to this report.

20. DIRECTORS AND KEY MANAGERIAL PERSONNEL

i. During period under review, the Company as on March 31, 2023, has 7 Directors and following is the detail of the Board of Directors:

S. Name No

DIN

Appointments

Cessation

1. Smt D Thara

01911714

18.11.2019

2. Smt.Priya Mahadevn

08026476

14.06.2021

18.04.2022

3. Shri Rajeev Kumar Das

07730466

14.06.2021

-

4. Shri Ravi Kumar Arora

09217881

28.06.2021

-

5. Shri Suvasish Das

09826037

15.12.2022

6. Dr.Madhu Rani Teotia

09352906

12.10.2021

15.12.2022

7. Dr.Sunita Chandra

09415680

29.11.2021

-

8. Shri G R Kanakavidu

09471091

20.01.2022

-

The Strength of Board of Directors of the Company as on March 31, 2023 was 7 (Seven) Directors comprising of 5 (Executive & Non-Executive Director) and 2 NonExecutive Independent Directors.

In terms of provisions under SEBI Regulations and DPE guidelines, HPIL being a listed Company and having an executive Chairman, 50% of its Board of Directors should comprise of independent directors, however, the Company was not having attention to certain matters under "Emphasis of Matters" which is reported in Auditors’ Report and forming part of this report.

17. ANNUAL RETURN

In term of provision of Companies Act, 2013 as amended, the return is available on website of Company on https: / /www.hpil.co.in/annual-report/.

requisite number of these directors during the year. The Secretarial Auditor has also given observations in this respect in their report. In this respect, as Directors on the Board are appointed by Government, HPIL had regularly requested Ministry of Housing & Urban Affairs for appointment of requisite number of independent directors/independent woman director to comply with the applicable requirements under SEBI (LODR) Regulations, DPE Guidelines and Companies Act and the same was also informed to Stock Exchanges.

The Company conducts session for the Directors to keep them abreast of the latest insights into the industry and also share the future strategy. The session was very insightful and the Board reciprocated with key insights of future goals.

None of the Company’s directors are disqualified from being appointed as a director as specified in Section 164 of the Act. For details about the directors, please refer to the Corporate Governance Report.

ii. Details of Key Managerial Personnel

The following are the Key Managerial Personnel of the Company for the financial

year 2022-23 are:

• Ms. D Thara ,

Chairperson & Managing Director

• Sh. Bhavesh Singla

Chief Financial Officer

• Ms Lubna

Company Secretary

iii Independent Directors

The Ministry of Housing & Urban Affairs vide its order dated 29.11.2021 & 20.01.2022 appointed Dr.Sunita Chandra (DIN 09415680 ) & Shri G R Kanakavidu (DIN : 09471091) as Independent Director on the Board of Company.

iv. Retirement of Directors by Rotation:

As per the Companies Act, 2013 the provisions in respect of retirement of Directors by rotation will not be applicable to Independent Directors and as per Articles of Association of Company, the Chairman also not liable to retire by rotation, in view of this, Independent Director & CMD is not considered to be retiring by rotation but all other directors will be retiring by rotation. Accordingly, one third among all other directors are liable to retire by rotation and being eligible, offer themselves for reappointment . Shri Ravi Kumar Arora shall be eligible to retire by rotation and offers to re-appoint.

21. DECLARATION BY INDEPENDENT DIRECTORS AND MEETING OF INDEPENDENT DIRECTORS

Pursuant to the provisions of Section 149 of the Act and Regulation 25(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘SEBI Listing Regulations’), the Independent Directors have submitted declarations that each of them fulfill the criteria of independence as provided in Section 149(6) of the

Act along with the rules framed thereunder and Regulation 16(1)(b) of the SEBI Listing Regulations. There has been no change in the circumstances affecting their status as Independent Directors of the Company. In the opinion of the Board, the Independent Directors are competent, experienced, proficient and possess necessary expertise and integrity to discharge their duties and functions as Independent Directors.

All Independent Directors of your Company have confirmed that they meet the criteria of Independence as prescribed under both the Companies Act, 2013 and the SEBI Listing Regulations. The Independent Directors have also confirmed that they have complied with the “Code of Business Conduct and Ethics for Board Members and Senior Management” of the Company. A Separate Meeting of Independent Directors in accordance with the provisions of the Companies Act, 2013 was held on 10 February, 2023 and all the Independent Directors were present.

22. RETIRING DIRECTOR(S) AND SEEKING APPOINTMENT REAPPOINTMENT AT THE AGM

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Shri Ravi Kumar Arora, Director shall retire by rotation at the ensuing 19th AGM of the Company and being eligible, offers himself for re-appointment. Brief resume and other particulars of Shri Ravi Kumar Arora, Director is annexed to the Notice of AGM forming part of this Annual Report.

23. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT.

The Listing Regulations mandates the inclusion of the Business Responsibility and Sustainability Report part of the Annual Report for the top 1000 listed entities based on market capitalization. A detailed report of BRSL is annexed forming part of this Annual Report as Annexure II.

24. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

Meetings of the Board were held 6 (Six) times during the financial year 2022-23 For further details of the number and dates of meetings of the Board thereof held during the financial year 2022-23 indicating the number of meetings attended by each Director, please refer to the Report on Corporate Governance as which forms part of this Report.

25. EVALUATION OF BOARD OF DIRECTORS/INDEPENDENTDIRECTORS

As per the statutory provisions, a listed company is required to disclose in its Board’s Report, a statement indicating the manner in which formal annual

evaluation of the performance of the Board, its Committees and individual Directors has been made and the criteria for performance evaluation of its Independent Directors, as laid down by the Nomination and Remuneration Committee.

However, the Ministry of Corporate Affairs vide its notification dated June 5, 2015 has, inter alia, exempted Government companies from the above requirement, in case the Directors are evaluated by the Ministry or Department of the Central Government which is administratively in charge of the company, as per its own evaluation methodology. Further, MCA vide notification dated July 5, 2017, also prescribed that the provisions relating to review of performance of Independent Directors and evaluation mechanism prescribed in Schedule IV of the Companies Act, 2013, is not applicable to Government companies.

Accordingly, Further, in line with above exemptions, Sub-Sections (2), (3) & (4) of Sec. 178 regarding appointment, performance evaluation and remuneration shall not apply to Directors of Government Companies, the Company is inter-alia exempted in terms of the above notifications, as the evaluation of performance of all members of the Board of the Company is being done by the Administrative Ministry.

26. COMMITTEES OF THE BOARD

During the period under review, the Company has following Committee(s) of the Board of Directors, which were reconstituted from time to time to comply with the applicable provisions :

i. Audit Committee

ii. Nomination & Remuneration Committee.

iii. Stakeholder & Relationship Committee.

iv. Risk Management Committee

The Details of Committee, the Constitution and composition of Committees applicable as per Companies Act, 2013 and SEBI (LODR) 2015.Please refer to the Report on Corporate Governance which forms part of this Report.

27. VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has in place a “Whistle Blower Policy”, in compliance of the provisions of the Companies Act, 2013, SEBI LODR Regulations and DPE Guidelines on Corporate Governance. The Whistle Blower Policy enables and ensures transparency in functioning of Company and it enables the employee to bring notice of such incidents and activities those are the violation of any policies of Company. It also provides safety for the protection to the complainant from victimization for whistling any violations and malpractices in the Company. This vigil mechanism enables the employees and Directors of Company to raise the concern where there is reason to believe that there has been serious malpractice, fraud, impropriety, abuse or wrong doing within the Company. The policy on

Whistle Blower Policy can be accessed at website of the Company on www.hpil.co.in.

28. CORPORATE SOCIAL RESPONSIBILITY (CSR) & SUSTAINABLE DEVELOPMENT

The provisions of Companies Act, 2013 for Corporate Social Responsibility are not applicable on the Company and accordingly policies and initiatives are not applicable.

29. INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY WITH REFERENCE TO FINANCIAL STATEMENTS

Your Company has adequate Internal Financial Controls (IFC) system for ensuring, the orderly and efficient conduct of its business, adherence with the laid down policies ,procedures, safeguard of assets of the Company, prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information commensurate with the operations of the Company.

Your Company is committed to ensure that its operations are carried out within a well-defined internal control framework, good governance, robust systems and processes, a vigilant finance function and an independent Internal Audit function are the foundations of the internal control systems.

The Company has in place adequate internal financial control with reference to financial statements.

The Internal Financial Controls of the Company were reviewed by Internal Auditors appointed. According to them, the Company has, in all material respects, laid down internal financial controls (including operational controls) and that such controls are adequate and operating effectively during the year ended 31 st March, 2023.

30. CONSERVATION OF ENERGY,TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

During period under review, there are no significant particulars, relating to conservation of energy and technology absorption as your Company does not own any manufacturing unit/ facility, however energy conscious organization, has taken various initiatives in the direction of energy conservation on a continuous basis. Further, the Company has neither absorbed any technology indigenous/ imported, during the year, nor imported any technology during the last three years.

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts)Rules, 2014, is given in Annexure -IV to this report.

31. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The Company has not made any investment, given guarantee and securities during the year under review. Therefore, the relevant section 186 of Companies Act, 2013 is not applicable during period under review.

32. CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

During the year under review, the Company have entered with the related party on arm length basis and in ordinary course of business. The details of which are mentioned in the financial statement of the Company forming part of this report.

The policy on materiality of related party transactions is available on the Company’s website, at the www.hpil.co.in.

All related party transactions that were entered into during the financial year ended 31st March, 2023 were on an arm’s length basis and in the ordinary course of business. The Company obtained approval of shareholders on all the material related party transactions in accordance to SEBI Listing Regulations, 2015 , Companies Act, 2013 and rules made thereunder to the extent applicable. The disclosure of transactions with related party for the year, as per IND Accounting Standard-24 Related Party Disclosures is mentioned in notes of Financial Statements as on 31st March, 2023. The particulars of Related Party Transactions required to be disclosed in Form AOC-2 for the financial year 2022-23 is annexed to this Report.

33. RISK MANAGEMENT

The Company identified that it is exposed to various unseen risks and uncertainties which are built-in for Realty estate Companies. The Company has risk management committee to identify the external and internal risks which may impact the day to day and future objectives of Company.

Risk management forms an integral part of the business planning and review cycle. The Company’s risk management initiatives are designed to overview the main risks known to your Company, which could hinder it in achieving its strategic and financial business objectives. The objectives are met by integrating management control into the daily operations, by ensuring compliance with legal requirements and by safeguarding the integrity of the Company’s financial reporting and its related disclosures like businesses, objectives, revenues, income, assets, liquidity or capital resources. The risk factors are specified in Management Discussion and Analysis Report annexed with the Annual report.

34. DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 134(5) of the Companies Act, 2013, your Directors, to the best of their knowledge confirm that:-

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(ii) 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 and of the profit and loss of the company for that period;

(iii) 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;

(iv) The directors have prepared the annual accounts on a going concern basis;

(v) 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.

(vi) 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.

35. CORPORATE GOVERNANCE

The Company has taken several initiatives towards Corporate Governance & its practices are appreciated by various stakeholders and believes in the principle that Corporate Governance establishes a positive organizational culture and it is evident by responsibility, accountability, consistency, fairness and transparency towards its stakeholders. As required under SEBI Listing Regulations and DPE guidelines on Corporate Governance, a separate report on Corporate Governance practices followed by the Company forms part of this Report at Annexure-III.

A Practicing Company Secretary has examined and certified your Companys compliance with respect to conditions enumerated in SEBI (LODR) Regulations and DPE guidelines on Corporate Governance. The certificate required in DPE guidelines and SEBI (LODR) Regulations forms part of this Report.

As a responsible corporate citizen and to reduce carbon foot print, your Company has actively supported the implementation of ‘Green Initiative’. Electronic delivery of notice of Postal Ballot, notice of Annual General Meeting (AGM) and Annual Report along with other communications is being done to those shareholders whose email ids are already registered with the respective.

Unless otherwise desired by the shareholders, the Company sends all documents to the shareholders viz. Notice, Audited Financial Statements, Directors’ and Auditors’ Report, etc. in electronic form to their registered e-mail addresses. In respect of financial year 2022-23, in terms of exemption granted by MCA vide General Circular No. 02/2022, dated 05.05.2022 read with General Circular No. 02/2021 dated 13th January, 2021, General Circular No. 20/2020 dated 5th May, 2020; General Circular No. 14/2020 dated 8th April, 2020 and General Circular No. 17/2020 dated13th April, 2020 and by SEBI Circular no. SEBI/HO/CFD/CMD1/CIR/P/2020/79 dated 12th May, 2020,

SEBI/HO/CFD/CMD2/CIR/P/2021/11 dated 15th January, 2021 and SEBI/HO/CFD/CMD2/CIR/P/2022/62 dated 13th May, 2022, Annual Reports are being circulated among the members whose email IDs are available with the Company through electronic mode. Accordingly, no physical copies of the Annual Reports are being circulated among the members of the Company.

36. AUDITORS

Statutory Auditors

The Comptroller and Auditor General of India under Companies Act 2013, appointed 2022-23, M/s Dhruv Aggarwal& Co LLP (FRN N500365/ 005469N) ,Statutory Auditors of your Company for the financial year 2022-23 by the Comptroller & Auditor General (C&AG) of India. The Statutory Auditors have audited the Financial Statements of the Company for the financial year ended March 31, 2023.

Further, the Statutory Auditors for the financial year 2022-23, M/s Dhruv Aggarwal & Co LLP is appointed by the Comptroller & Auditor General (C&AG) of India. Approval of the Members of the Company will be obtained in ensuing Annual General Meeting, to authorize the Board of Directors of the Company, to fix the remuneration of Statutory Auditors for the financial year 2022-23, as may be appointed by C&AG.

The notes on the financial statements referred to in the Auditors’ Report are selfexplanatory and do not call for any further comments.

• Reporting of frauds by Auditors

During the year under review, no fraud has been reported by the Auditors under section 143(12) of the Companies Act, 2013 read with Rule 13 of the Companies (Audit and Auditors) Amendment Rules, 2015

• Cost Auditors

The Cost audit of the Company has not been conducted for the financial year 2021 -22 as provisions of Section 148 of the Companies Act, 2013 are not applicable on the Company.

• Secretarial Auditors

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 Kumar Naresh Sinha & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report from the auditor is annexed as to this report.

The Secretarial Auditor as well as the Auditor who has given Corporate Governance Compliance certificate had given observations in their report regarding matters during the year related to board composition, not having adequate number of independent directors and non compliance with Regulation 25 (10) SEBI (LODR) Regulations, 2015.

A

37. MANAGEMENT’S COMMENTS ON THE AUDITORS’ REPORT

The management’s reply to the observations of the Secretarial Auditors is as under:

Observation of Secretarial Auditors

Management’s Reply

1. Half of the board of directors of the company was not independent including one women independent director as required under Regulation 17(1) of SEBI (LODR) Regulations, 2015 and para 3.1.4 of DPE Guidelines on Corporate Governance with regard to Composition of the Board of Directors.

HPIL is a Government Company and the power to appoint Directors on the Board of the Company vests with the President of India, acting through the Administrative Ministry, i.e., the Ministry of Housing & Urban Affairs, Government of India and the Company has no role in the appointment of Directors on its Board.

The Company has been requesting & following up with the Ministry of Housing & Urban Affairs, Government of India, for appointment of requisite number of Independent Director on its Board.

2. The company has not taken D&O insurance for the Independent Directors appointed on the Board of the Company as required under Regulation 25(10) of SEBI (LODR) Regulations, 2015.

Accordingly as on March 31, 2023, the composition of Board which require presence of at least half of the strength of Independent Directors, was not in conformity with the applicable statutory provisions. The Company will be in due compliance with the applicable provisions of SEBI (LODR) 2015, on appointment of 3 Independent Directors on the Board of Company.

The Company is considering to comply with the Regulation 25 (10) of SEBI Listing Regulations, 2015 and it is assured that the same shall be adhered.

38. COMMENTS OF COMPTROLLER AND AUDITOR GENERAL OF INDIA (CAG)

The Comptroller & Auditor General (C&AG) of India, vide letter(s) dated August 03, 2023 have given ‘NIL’ comments on the Audited Financial Statements of the Company for the financial

year ended March 31, 2023 under Section 143(6)(a) of the Companies Act, 2013. The comments of C&AG for the financial year 2022-23 have been placed along with the report of Statutory Auditors of the Company in this Annual Report

39. CODE OF BUSINESS CONDUCT & DECLARATION BY THE CHAIRPERSON & MANAGING DIRECTOR (CMD)

To comply with the requirements of Regulation 17(5) of the Listing Regulation, the Company has adopted Code of Conduct for Board of Directors and Senior Management Personnel (“the Code”). All Board members and senior management personnel have confirmed compliance with the Code for the year 2022-23.

The code requires directors and employees to act honestly, fairly, ethically and with integrity, conduct themselves in professional, courteous and respectful manner. The code is displayed on the Company’s website www.hpil.co.in. A declaration by CMD on compliance of the “Code of Business Conduct and Ethics for Board Members and Senior Management” for the year 2022-23 is placed as Annexure to Corporate Governance Report.

40. CEO/CFO CERTIFICATION

As required by Regulation 17 (8) of the SEBI (LODR) Regulations, 2015, the Compliance Certificate as specified in Part B of Schedule II of the said Regulation duly signed by Sh. Bhavesh Singla, CFO was placed before the Board of Directors. The same is enclosed as Annexure of Corporate Governance Report.

41. GREEN INITIATIVE

The Companies Act, 2013 permits companies to send documents like Notice of Annual General Meeting, Annual Report etc. through electronic means to its members at their registered email addresses. As a responsible corporate citizen, the Company has actively supported the implementation of ‘Green Initiative’ of the Ministry of Corporate Affairs (MCA) and effected electronic delivery of Notices and Annual Reports to shareholders, whose email ids are registered.

Further, pursuant to Section 108 of the Companies Act,2013 read with Rule 20 of the Companies (Management

and Administration) Rules, 2014, the Company is providing e-voting facility to all members to enable them to cast their votes electronically in respect of resolutions set forth in the Notice of Annual General Meeting (AGM). The Company will also be conducting the AGM this year through videoconferencing / other audio-visual means. Members can refer to the detailed instructions for e-voting and electronic participation in the AGM, as provided in the Notice of AGM. Members, who have not registered their e-mail addresses so far, are requested to register their e-mail addresses with the Registrar and Share Transfer Agent (R&TA) of the Company or their respective Depository Participant (DP) and take part in the green initiative of Company.

41. PREVENTION, PROHIBITION AND REDRESSAL AGAINST HARASSMENT OF WOMEN EMPLOYMENT

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition &Redressal) Act, 2013 (‘Act’) and rules made there under. The Prevention of Sexual Harassment (POSH) do not applicable on your company. However, the Company would take every complaint seriously and there are no complaints on sexual harassment at workplace received during the period under review.

42. RIGHT TO INFORMATION

Right to Information (RTI) Act, 2005 has empowered the Indian citizen to access information from public authorities, resulting in transparency and accountability to the working of the authorities. Your Company has appropriate mechanism to provide information to citizens under the provisions of Right to Information (RTI) Act, 2005.

The status of RTI received during the year is as follows:

RTI Application Received

Rejected

Information

provided

Returned

to

Applicant

Pending

Pending

Applications

1

0

1

1

0

43. HUMAN RESOURCE

As on date the Company has 5 (five) full time employee engaged on contractual basis.

Further the Company being a Central Government Public Sector Undertaking needs to observe/ have Reservation policy for engagement or appointment of employees in the Company. However, the Company as on date does not have any permanent employees and in future the reservation policy for various categories such as SC/ST/OBC/ PwDs/ Ex-servicemen shall be duly followed.

44. OTHER DISCLOSURES

i. There was no change in the nature of business of the Company during the financial year 2022-23.

ii. The Company has not accepted any public deposits during the financial year 2022-23

iii. Information on composition, terms of reference and number of meetings of the Board and its Committees held during the year, establishment of Vigil Mechanism/Whistle Blower Policy and web-links for familiarization programmes of Directors, Policy on Materiality ofRelated Party Transactions and Dealing with Related Party Transactions, Policy for determining Material Subsidiaries, compensation to Key Managerial Personnel, sitting fees to

Directors etc. have been provided in the ‘Report on Corporate Governance’, prepared in compliance with the provisions of SEBI (Listing Obligations & Disclosure Requirements)Regulations, 2015 and DPE Guidelines on Corporate Governance, 2010, as amended from time to time, which forms part of this Annual Report.

iv. The Company has not bought back any of its securities during the year under review.

v. The Company has not issued any sweat equity shares during the year under review.

vi. No bonus shares were issued during the year under review.

vii. The Company has not provided any stock option scheme to the employees.

viii. Insolvency And Bankruptcy Code, 2016 : No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 during the year along with their status as at the end of the financial year is not applicable

ix. Compliance with Secretarial Standards: The Company adhered to the provisions of applicable Secretarial Standards I & II during the financial year 2022-23

x. The provisions of Section 197 of the Companies Act,2013 and Rules made thereunder relating to managerial remuneration are not applicable to Government companies, therefore no disclosure is required to be made.

xi. During the year under review, the statutory auditors/secretarial auditors have not reported to the Audit Committee, any instances of fraud committed against the Company by its officers or employees.

xii. The Independent Directors of the Company are nominated / appointed by the President of India acting through the Administrative Ministry. Accordingly, the appointing authority considers the integrity, expertise and experience of the individual to be nominated/appointed. In the opinion of the Board, the Independent Directors appointed during the year, are persons of integrity and possess the relevant expertise, proficiency and experience to contribute effectively to the Company. Further, during the year, all the Independent Directors have met the requirements specified under Section 149(6) of the

Companies Act, 2013 and necessary declaration from each Independent Director was also received as required.

xiii. Statutory and Other Information Requirements

Information required to be furnished as per the Companies Act, 2013, SEBI (Listing Obligations & Disclosure Requirements) Regulations,

2015 and other applicable statutory provisions is annexed to this report.

45. ANNEXURES TO BOARD’S REPORT

In terms of the provisions of SEBI (Listing Obligations & Disclosure requirements) Regulations, 2015 and other applicable statutory provisions, separate sections containing Management Discussion & Analysis Report, Report on Corporate Governance, Business Responsibility &Sustainability Report, are enclosed to this Board’s Report. Various statutory reports, information, certificates etc., in terms of the Companies Act, 2013, SEBI (Listing Obligations &Disclosure Requirements)

Regulations, 2015, DPE Guidelines on Corporate Governance for CPSEs, 2010 and other applicable statutory provisions, are enclosed to the Board’s Report

46 ACKNOWLEDGEMENT

Your Directors also acknowledges gratefully the shareholders for their support and confidence reposed on your Company. The Directors hereby wish to place on record their appreciation of the efficient and loyal services rendered by each and every employee, without whose whole-hearted efforts, the overall satisfactory performance would not have been possible. We thank the Government of India, Ministry of Corporate Affairs, Ministry of Finance, the Ministry of Corporate Affairs, the Central Board of Direct Taxes, the Central Board of Indirect Taxes and Customs, GST authorities, the Reserve Bank of India, Securities and Exchange Board of India (SEBI), our banker & advisors etc. and look forward to their continued support. Your Directors look forward to the long term future with confidence.

For and on behalf of the Board of Directors of Hemisphere Properties India Limited

Sd/- D Thara

Chairman, Managing Director

Place: New Delhi Date: 11.08.2023

(DIN: 01911714)

Management Discussion and Analysis Report

l.Economy & Industry Outlook

i. Global Economy

The world is becoming normal after 2 year of COVID outbreak, the global economy is gaining momentum but yet uncertain due to rising inflation, aggressive monetary policy by the Central bank.Global real GDP is forecasted to grow by 2.7 percent in

2023, down from 3.3 percent in 2022. We expect further slowing to 2.4 percent in

2024. Economic growth is moderating under the weight of still high inflation and monetary policy tightening. Rather than a global recession, we expect a relatively subdued economic outlook. Growth is generally strongest in emerging Asian economies, and weakest in Europe and the US.Rapid monetary policy tightening over the last year or so led to weakening in global housing, bank lending, and the industrial sector. However, this weakness has been more than offset by strength in other sectors, most notably service-sector activities, which is visible in labor markets. Strong consumer spending and the fading impact of shocks of recent years have been difficult to assess, leading to ongoing forecast revisions. Nonetheless, recent data point to moderation of these positive trends, leading to slower global growth in the second half of 2023 and early 2024.

The rise in central bank rates to fight inflation and Russia’s war in Ukraine continue to weigh on economic activity. The estimates of International Monetary Fund(IMF), the global growth should bottom out at 2.8percent this year and expected to rise to 3 percent in2024. Further, slowdown is concentrated in advanced economies especially United Kingdom and the Euro area, whereas Emerging and Developing countries are already showing signs of recovery and are expected to grow faster.

ii. Indian Economy

During 2022-23, India was one of the fastest growing economies amidst a slowing global economy. Inflationary trends, both globally and in India, caused central banks to raise policy rates which had some impact on businesses during the period.The Indian economy’s growth slowed to 7.2% in the financial year 2022-23, as compared to a 9.1% rise in the previous fiscal year, official data. The gross domestic product (GDP) grew 6.1% in the fourth quarter of 2022-23 and that led to a rise in the annual GDP growth rate, data showed

Rising borrowing costs and slower income growth are weighing on private consumption growth, and government consumption is projected to grow at a slower pace due to the withdrawal of pandemic-related fiscal support measures. Despite this, India will remain one of the fastest growing economies in a challenging global environment.

After two years affected by COVID, Tier 2 and Tier 3 cities have arisen as fresh major real estate trends in 2022, and the real estate market has set unprecedented benchmarks which continued its growth momentum from 2021 amid the global slowdown. The real estate market in India had impressive progress in 2022, setting new sales records of 68% YoY (approx.), further demonstrating the industrys prominence as one of Indias fastest-growing industries.Further, the rising star, the co-working industry, has successfully adapted to changing work requirements and will continue to service the needs of young growing India. The co-working sector in India is expected to cross 50 million sqft by the end of the year 2023 which would be a YOY 15% increase. Managed Office spaces shall continue growing at 10% in 2023. According to a recent JLL report, the net absorption of office space in 2022 across the top seven cities (Mumbai, Delhi-NCR, Bengaluru, Hyderabad, Chennai, Kolkata and Pune) has been 38.25 million sqft,)

In FY 2022-23,the real estate sector has welcomed the Reserve Bank of India’s (RBI’s) decision to keep the key policy rate unchanged. The home loan rates have been hovering around 9%, following the central bank’s six consecutive rate hikes totalling 250 basis points since May last year. The RBI MPC (Monetary Policy Committee) decision to keep a pause on rate hike is positive for the housing market as it reduces the uncertainty and volatility associated with interest rate fluctuations. The home loan interest rates have gone up from 6.5% to around 8.75% with a series of rate hikes in the past and the move to pause will give a temporary reprieve and support the existing growth momentum in the real estate sector. Loans which form about 70% of asset book of banks in India are largely floating in nature. Also, the base interest rates in India are higher than global peers, making the sensitivity of investments to mark-to-market losses relatively lower.The union budget presented this year wasvery supportive of the long-term growth of the real estate sector in India through its focus on urban infrastructure andthe digital economy.

The demand and supply dynamics would evolve and change. On the brighter side, the real estate sector has been quick to respond to changes and adapt to new technologies; this is apparent that due to digitalization there is and will be major shift in investment preferences that will continue to outlive the pandemic.

iii. Real Estate Trend in India

The Real estate market is resilient which is evident in the past years, the residential segment witnessed strong performance, commercial office sector continues to remain sluggish with demand not yet reaching the pre-pandemic levels. Real estate is expected to act as an investment vehicle, and assets will thus be created for investment and money-making. Traditionally touted as an investment, both buying a home for personal use and securing one solely for investment are two different asset classes in the real estate industry. As the industry matures, certain assets like commercial real estate, which drives income for investors, have taken over residential real estate as the primary destination for investors. In contrast, the latter

is now being reserved for private use only.India Ratings and Research (Ind-Ra) predicts that Indias housing market will continue to grow in the current financial year 2023-24, with sales expected to increase by 9 per cent compared to the previous year. The growth is supported by a steady and healthy demand, although factors such as a potential global recession and inflation may slightly dampen the demand soon. However, the market is expected to withstand any pressure due to supply consolidation and improved affordability compared to historical standards.

The demand growth in the housing market will be uneven, with top-tier players likely to see sales growth of about 15 per cent-18 per cent in 2023-24 and enjoy better liquidity than lower-tier players. Homebuyers are becoming more cautious of underconstruction projects, leading to a formalisation of the sector, with top-tier and strong local players gaining market share and customer preference.

According to data from LiasesForas, residential sales in the top eight cities in India, including Mumbai, Bengaluru, Chennai, Hyderabad, NCR, Pune, Ahmedabad, and Kolkata, increased by 18 per cent in 2022-23, reaching 392 million square feet. This growth was driven by consistent and healthy demand, as well as renewed interest and improved perceptions from homebuyers following the pandemic.

Residential Real Estate

• India’s residential property market witnessed a record-breaking year in FY23, with the value of home sales reaching an all-time high of Rs.3.47 lakh crore , marking a robust 48% year-on-year increase, Anarock Property Consultants. Year 2023 was a milestone year for the Indian Real estate sector with all-time high sales. The sector showed healthy growth on the back of a high base achieved in fiscal 2022.

• The demand pick-up seen in the second half of fiscal 2021 has continued into fiscal 2023 and is expected to continue in fiscal 2024.Preference for larger sized apartments, inclination towards reputed developers and a rising demand for townships projects are just some of the emerging trends.

• As per Knight & Frank Report, Development activity has risen in tandem with the improved demand despite the increasing costs of input material and labour across markets. As many as 160,806 units were launched during H1 2021, a 56% increase YoY. Even in sequential terms, launch volumes were a substantial 25% higher than the relatively unaffected H2 2021 period.

• Demand momentum was strong across markets in YoY terms in H1 2022 and Kolkata was the only market which saw sales volumes drop in sequential terms. With the second largest share of sales, NCR was the biggest mover among all the markets with sales volumes vaulting by 154% YoY during the period. Mumbai accounted for 28% of the total sales, highest among all markets. Among other large markets, Bengaluru had a similar strong showing with sales growing 80% YoY in H1 2022 to 26,667 units. Increased hiring and steady income growth in the Information Technology (IT) sector dominated markets such as Bengaluru, also buoyed homebuyer demand.

• Consistent with the upward trend seen in the past three periods, the share of sales in the INR 10 mn and above ticket-size grew significantly to 25% in H1 2022 compared to 20% a year ago. This can be attributed to the homebuyers’ need to upgrade to larger living spaces with better amenities, and to the fact

that pandemic-induced income disruptions did not impact higher income categories as they did for the others.

• The growth in sales volumes during H1 2022 is more significant considering that it has occurred along with very encouraging price growth across all markets. Prices have grown in YoY termsacross all markets for the first time since H22015. Prices increased in the range of 3- 9% YoYacross markets with prices in the larger markets of Mumbai, NCR and Bengaluru moving at the top of this growth band at 6%, 7% and 9% YoY respectively. Albeit, increasing instances of developers offering greater value adds such as better finished/furnished apartments were also observed especially towards the end of H1 2022.

• Bengaluru, Mumbai & Delhi NCR contributed more than 60% of sales in 2022.Bengaluru and Mumbai jointly led the annual sales in 2022 as they clocked more than 46,000 units (22% share each) followed by Delhi NCR at 38,000 units (18% share). It is interesting to note that Kolkata, along with the two bigger markets of Mumbai, and Bengaluru witnessed the highest yearly growth in sales. In the second half of the year (H2 2022), sales accounted for 51% share of the overall sales in 2022. The high sales volumes in H2 2022 show that sales were still robust despite the recent challenges underlining the strength of the residential market in India and the increasing importance of home ownership post-pandemic.

Further, Despite the steep rise in the mortgage rates, demand trends exhibited sustained momentum as they were well supported by multiple factors including Improving affordability, Desire to own homes, Aspirational lifestyle and need to upgrade to larger homes with better amenities, Rising urbanisation, Limited supply of quality products, Increasing consolidation in favour of larger & credible developers etc.

Commercial market Segment

• According to research reports, office leasing activity exhibited nearly equal demand levels as compared to the pre-pandemic period. As per Savills research, the gross absorption for CY 2022 was recorded at ~5.09 million square meters (msm) [~54.8 million square feet (msf)] reflecting a Y-o-Y growth of 48.5% while the new supply added during the same period was ~4.96 msm (~53.4 msf), a Y-o-Y change of 45%. One notable trend observed in this segment was the lower than anticipated growth in the second half owing to global economic uncertainties. Year 2022 was a volatile year for the Indian Commercial market which was dented by fears of global economic slowdown. These global headwinds not just weighed down growth projections for the Indian economy, it also weighed on some leasing transactions. Nevertheless, the Corporate space space market concluded with a significant 36% YoY growth in transaction

• India holds potential for huge growth in data centres, driven by policy initiatives, widening customer base and expanding corporate requirements for data storage. The ‘Digital India’ campaign by the government, has also given a fillip to this segment. There is synergy between rising demand for data centres and demand for commercial real estate.

• According to a report by Cushman and Wakefield, the amount of data stored in India is expected to skyrocket from 40,000 petabytes in 2010 to 2.3 million

petabytes in 2020. This has led to a flurry of investment across the nation. The demand for hyper-scale data centres is on the rise, as a result of the government’s push, in terms of the national E-commerce Policy and proposed policy on DC parks

Retail Segment

• The retail segment outperformed with sustained growth momentum continuing across the country. As per CBRE research, the retail segment recorded a 21% Y-o-Y growth in leasing activity with ~0.44 msm (~4.7 msf) of absorption in the calendar year.

• Industry research expects a robust demand and supply for organized malls in the coming years with an expected supply of ~0.93 msm (~10 msf) in the next year.

• Market growth approaches have undisputedly indicated Grade-A office properties yielding some of the highest returns across the commercial real estate segment. The stereotypical processing of this fact was best exemplified by an impressive rise in the demand for office space, which witnessed an unprecedented 50% growth in 2022. . Commercial real estate funds are making their presence felt in the market as the idea of earning passive income from safe real estate investment has found a lot of excitement among small-time investors. The coming year may bring a lot more options for such investors who do not have portfolios in crores.

Government Initiates

i. Budget 2023

The real estate sector had several expectations from the Union Budget 2023 given that the past year had witnessed a significant recovery from the pandemic period and expectation was that long standing demands from a tax perspective would be addressed in the Budget so as to sustain the recovery in the sector.The Budget 2023 has highlighted several measures that will impact real estate development in India. Experts have given mixed opinions on the budget’s impact, but the favorable measures announced have drawn attention to India’s real estate services industry. The followings are the key takeaways from the budget and their impact on real estate:

• Economic Boosters

The budget has announced Rs. 5.54 lakh crore allocation for the infrastructure sector, which is expected to support economic growth and create more business opportunities. These measures are expected to witness real estate growth in India, as it relies heavily on economic growth.

• Emphasis on Urban Planning

The budget has emphasized urban planning in Tier 2 and Tier 3 cities, boosting real estate development in these areas. The government’s focus on developing these cities will lead to better infrastructure, attracting more investments in the real estate sector.

The government has allocated funds for the development of smart cities, affordable housing schemes, and infrastructural development in these

regions. Moreover, the government has increased the allocation for the PMAY-U scheme by almost 66% to Rs 79,000 crores in the Union Budget 2023.

• Emphasis on Affordable Housing

The Pradhan Mantri Awas Yojana (PMAY) has been extended, and additional funding has been allocated. This affordable housing scheme will provide reasonable housing to millions of Indians. PMAY houses are a crucial aspect of this scheme, and the government has made efforts to ensure the completion of the remaining 1.5 crores of PMAY houses

• Infrastructural Development

The Budget 2023 has allocated additional funds for infrastructure development in India, which is expected to boost the real estate industry. Better roads, airports, and railways will improve connectivity and attract investment in the Indian real estate sector

OUTLOOK AND STRATEGY

In 2002, the Government of India conducted a disinvestment exercise in respect of 25% of its shareholding in the equity share capital of VSNL (currently known as Tata Communications Limited), wherein in terms of the bid for the disinvestment required a separate value to be ascribed to lands to be retained with VSNL and to exclude the value of certain Land parcels, held by VSNL. Panatone was the successful bidder in the disinvestment process and subsequently, entered into the VSNL SPA and the VSNL SHA. In terms of the disinvestment bid, the VSNL SHA and VSNL SPA, the Land parcels identified were required to be hived off or demerged into a separate entity.

As a result, Hemisphere Properties India Limited was incorporated in 2005 as a real estate company. During FY 2012-13, Government of India acquired 51.12% equity stake in HPIL after the decision of Cabinet. Earlier, the Company was in administration of Department of Telecommunications and further after the Cabinet decision dated April 06th, 2018 the administration of HPIL was transferred from Department of Telecommunication to Ministry of Housing & Urban Affairs. The Mumbai Bench of National Company Law Tribunal and Ministry of Corporate Affairs approved Scheme of Arrangement & Reconstruction between Tata Communications Limited & Hemisphere Properties India Limited on 12.07.2018 and 05.08.2018 respectively.

The Land located in 4 major cities i.e. Delhi, Pune, Chennai and Kolkata were transferred under the Scheme. The Promoter of the company i.e. President of India holds 51.12% shares.

In terms of the Scheme of Arrangement, following transferred:

1. All rights, title and interest in the Land parcels were transferred to our Company;

2. All assets and liabilities pertaining to the Land parcels were transferred to our Company at their book value;

3. All debts, liabilities, taxes, duties and obligations pertaining to the Land parcels were transferred to our Company, except for any property taxes arising prior to the effective date, which would continue to be the liability of TCL;

The main objects of our Company are as follows:

i. To construct, acquire, hold, manage, develop, administer, protect, reserve and to deal in any other manner with properties, including sale and purchase thereof, whether such properties are in the nature of land or building (semi- constructed or fully constructed) or partially land and partially buildings, any where in India and if permitted by applicable legislations, outside India as well.

ii. To collect and settle revenue, rental, lease charges and such other charges as may be payable by any entity against legitimate use of such properties by persons, companies, agencies and administrations for the services provided and to utilise the same for furtherance of activities of the Company.

iii. To carry out business of developing, holding, owing, leading or licensing real estate, consultancy in real estate and property of all kinds and for this purpose acquiring by purchase or through lease, license, barter, exchange, hire purchase or otherwise, land or other immovable property of any description or tenure or interest in immovable property.

iv. To carry out the business of building construction and development of commercial building, industrial shed, offices, houses, buildings, apartment, structures, hotels or other allied works of every description on any land acquired howsoever by the company, whether on ownership basis or as a lessee or licensee and to deal with such construction or developed or built premises by letting out, hiring or selling the same by way of outright sale, lease, license, usufructuary mortgage or other disposal of whole or part of such construction or development or built premises.

Business Development

The Company has taken over the possession of land parcel and appointed CPWD for land maintenance &security for preventing any kind of encroachments. The Company has registered its name for Pune, Chattarpur & registration charges are paid for Chennai & Kolkata. The applications are pending before the Competent Authorities.

HPIL has conducted the due diligence for all the land parcel in FY 2021-22 and its was decided to move forward with Chattarpur land parcel. The demand discovery through expression of Interest was conducted for ascertaining demand of Farmhouses. The Company has obtained sufficient response to go ahead. Application for change in land use was filed with the Competent Authority and same is pending.

The Management with the concurrence of Ministry of Housing and Urban Affair will evaluate each land parcel and examine all available options available for further development of the Land. We will consider the proposals for growth in order to generate maximum revenue.

The Company received in-principle approval from Ministry of Finance for Rs. 751.00 crores for the payment towards stamp duty to give effect transfer of Title in the name of our Company and meet the need of other working capital requirements in due course of business. The Company till date has received Rs.180 crore in form of equity and loan, the remaining money shall be received in tranches or in lumpsum as per the decision of Ministry of Finance.

Further, the Company has initiated the process of engagement of Transaction advisor for Pune land parcel .The Company during financial year 2022 -23 generated revenue from rental income of Rs 200.20 lakhs from Pune land parcel.

SEGMENT-WISE PERFORMANCE

The Company does not have any other segment.

DEVELOPMENT OPPORTUNITIES Opportunities

Over the past few years, the government has supported in the development of India and promoted business opportunities within the country, including various policies made and initiatives, such as relaxation in Foreign Direct Investments (FDI) limits, improving ease of doing business, Housing for All, Make in India, Smart City and Start-up India. The major opportunities for our land parcel are:

1. Housing Demand 2 Sector Consolidation

3. Demand of vacant land in metro cities

4. Minimum Litigation

5. Direct Administration of MoHUA

The Company is in under the administrative control of MoHUA and board of directors has been appointed by MoHUA, who are excelled in handling the work related to estate and property. The Company will thrive on formulation of plans which are in pipe line.

Following are the sectors which are high in Demand:

Retail Space

i. Rise in demand due to foray of FDI in multi brand retail.

ii. Organized retail sector is growing by 25-30% annually.

iii. The retail segment is expected to remain steady in the medium to long term backed by strong supply pipeline and growth in absorption rate.

Housing Space

i. GOI aiming “Housing for All by 2022”- robust housing demand and has increased its focus on PradhanMantriAwaasYojana,especially in rural areas

ii. Rise in transition of kuccha housing to puccka housing in rural areas.

iii. Public-Private Partnership policy contributing to address the rise in housing shortage in cities at affordable rates.

iv. Growth in population and rapid urbanization.

v. Rise in disposable income.

vi. Easy availability of finance.

vii. Developers are focusing more on affordable and mid range categories to meet the huge demand.

Hospitality Space

i. Indian and International hotel chains are expanding. Expansion is

expected to boost the sector.

ii. Service apartments along with hotel rooms, business parks and even

retail arcade are rising under make in India programme.

iii. Tax incentives for hotels and higher Floor Space Index (FSI) are helping in

the growth of the hospitality space.

iv. Government’s efforts to promote tourism especially in Tier2 and Tier3 cities are generating a strong demand for hotels, especially budget hotels.

Commercial Space

i. India’s commercial space is one of the most well-organized markets in the

Asia- Pacific region, with the introduction of Real Estate Investment Trust (REITs) structure it will become more efficient.

ii. Few large players with pan India presence dominate the market.

iii. Change in operating model - shift from sales to lease and maintenance

iv. Rapid growth in service sector driving demand.

v. Increase in demand for commercial space due to robust business growth

and optimism in Indian economy, especially in tier-II cities.

vi. It is the most preferred asset classes in real estate by the investors over

the last few years and has attracted about 80% of the total investment made

in the sector.

Digital Real Estate Space

Digital marketing has emerged as an important tool for real estate developers for their sales and customer outreach. Post-pandemic, the marketing activities are not just limited to tap new customers or brand recognition, but establishing a personal touch through digital means.

With the tech-enabled tools to close real estate purchases online, developers have been able to record healthy sales even during the lockdown. Digital collaboration tools can be leveraged by the developers to interact with potential customers,

showcase project brochures, facilitate virtual site tours, and focus on NRIs to propel the sales. Going ahead, it will be imperative for the developers to adapt to a tech- savvy future and the proportion of real estate business generated online is expected to only rise further.

RISKS AND CONCERNS

The Company is exposed to a number of risks such as economic, regulatory, taxation and environmental risks as well as sectorial investment outlook.

Some risks that may arise in the normal course of business and could impact their ability to address future developments, comprise credit risk, liquidity risk, counterparty risk, regulatory risk, commodity inflation risk and market risk. The Company’s strategy of focusing on key products and geographical segments is exposed to economic and market conditions.

The Company continues to implement robust risk management policies that set-out the tolerance for risk management and the requisite mitigation, plans. The major risk and concerns are as under:

i. Statutory Approval

Registration of Titles in Name Of Company

The land is demerged into HPIL through order of Demerger and in land records maintained by various Revenue Authorities, the Land parcels continue to be registered in the name of the erstwhile VSNL or its successor entity, TCL, including in the registers of various registrars, sub-registrars and other land records at the respective locations.

The Scheme of Arrangement has directed the transfer of all Land parcels recorded in the Scheme of Arrangement to our Company, including all title to such Land parcels, we may be required to undertake additional compliances in order to transfer the Land parcels to the name of our Company and to perfect our title to the Land parcels.

Approval from Changing the Land Use

The real estate sector in India is heavily regulated by the central, state and local governments. Real estate developers are required to comply with a number of laws and regulations, including policies and procedures established and implemented by local authorities in relation

to land acquisition, transfer of property, registration and use of land. These laws often vary from state to state. Several of your Company’s projects are in preliminary stages of planning and any delay in obtaining approvals could warrant revised scheduling of project timelines

Exposure due to on-going Litigations

The land parcel of HPIL are subjected to certain disputes with regard to title and other claims. If any of these claims are determined adversely against our Company or our interests, we may be required to relinquish claims to all or part of the Land parcels or may be required to pay compensation to such claimants. Any such

adverse determination would impact our ability to develop or transfer the Land and any amounts to be paid out may require additional infusion of funds from our Promoter or from other sources, which may not be available to us on commercially viable terms or at all.

We may not be able to assess or identify all the risks and liabilities associated with such land, such as faulty or disputed title, unregistered encumbrances or adverse possession rights. In addition, title insurance is not available in India to guarantee title or development rights in respect of land. The absence of title insurance, together with the challenges involved in verifying title to land, may increase our exposure to third party claims to such land. As a result, the uncertainty of title to land makes acquisition and real estate development projects more complex and may impede the transfer of title, expose us to legal disputes and adversely affect the valuation of the land involved. In addition, we may also face the risk of illegal encroachments on the land parcels owned by us. We may be required to incur additional costs and face delays in our project development schedule in order to clear such encroachments. Disputes relating to land title can take several years and considerable expense to resolve if they become the subject of legal proceedings and their outcome can be uncertain. If we, are unable to resolve such disputes, the title to and/ or interest in,such land may be affected. An inability to obtain good title to any plot of land may adversely affect the development of a project for which such plot of land is critical and this may result in the write-off of expenses incurred in relation to such development. As a result, our business, financial condition and results of operations could be materially and adversely affected.

Further, in the event of any loss of contiguity of the land parcels constituting the Land on account of any adverse determination, we may not be able to maximise the value of the Land, or seek any premium that may be available for a single large parcel of land as compared to multiple smaller parcels. Failure to retain or acquire and provide such parcels of land may cause a delay or force us to abandon or modify our development of Land parcels. Additionally, we may be asked to pay premium amounts for acquiring certain large parcels of land. If we experience delay in or are unable to acquire the remaining undivided rights from other co-owners, we may not be able to develop such land. Accordingly, our inability to acquire or maintain and offer continuguous parcels of land may adversely affect our business prospects, financial condition and results of operations.

Financial Risk

There has been a contrasting trend in real estate lending over the past few years wherein reputed, low leveraged developers continued to enjoy easy access to liquidity as lenders remained selective and weaker developers struggled with limited sources of capital. Real estate sector performance is closely linked to economic recovery and its monetary policies. The Reserve Bank of India has so far maintained accommodative stance as it tries to support

economic recovery. However, going ahead we expect to see monetary tightening as the central bank tries to control inflation in the country. A nascent economic recovery along with rising interest rates could impact the real estate sector in the near term as cost of housing loans shoots up with rise in the cost of funding for the developers, who are already facing margin pressure due to commodity cost inflation.

Market Demand for largest Pune land parcel

Our largest parcel of Land parcels, aggregating to 524 acres is currently located in the PMR. As a result, our business, financial condition and results of operations will be heavily dependent on the performance of, and the prevailing conditions affecting, the real estate markets in the PMR. The real estate markets in these regions may be affected by various factors outside our control, including prevailing local and economic conditions, changes in the supply and demand for properties comparable to those we develop, changes in the applicable governmental regulations, demographic trends, employment and income levels and interest rates, among other facto Rs. These factors may contribute to fluctuations in real estate prices and the availability of land in the PMR and may adversely affect our business, financial condition and results of operations. These factors can also negatively affect the demand for and valuation of our Land.

Collaborator / Partner

Our ability to identify suitable partners or customers for development of the Land is a vital element of our business and involves certain risks, including appropriate financial resources and creditworthiness. We will be required to carry out independent assessment processes for identification of potential partners or customers for the Land which may include a due diligence exercise to assess the creditworthiness of any potential partner or customer, prior experience in developing such projects, suitability for development, development potential and ability to market. Our assessment processes will be required to be based on information that is available or accessible to us either through publicly available means or our diligence and assessment exercises. There can be no assurance that such information is accurate, complete or updated. Any decision based on inaccurate, incomplete or outdated information may result in certain risks and liabilities, which could adversely affect our business, financial condition and results of operations.

Fall in the Prices of Land and Development rights

The availability of developable land, has been increasing across real estate markets in India and therefore, alternative or cheaper land as compared to the Land in each of the markets where we own Land poses substantial challenges.

In addition, the use and development of land is subject to regulations by various local authorities. For example, if a specific parcel of land has been deemed as agricultural land, no commercial or residential development is permitted without the prior approval of the local authorities. Such restrictions could lead to further limitation of development of the Land parcels.

Joint development agreements and similar agreements with third parties.

We may enter into joint development agreements, joint venture arrangements, development management agreements, and similar arrangements with third parties for the development of some of the Land parcels and we by virtue of such agreements, may cede development rights to a portion or all of the Land parcels.

We may have limited ability to impose conditions on the developing agencies or joint venture partners, including for timely payment of consideration. In the event that we are unable to agree to commercially suitable terms or find joint venture or joint development partners who are unwilling to meet our commercial and other terms, we may be unable to develop or transfer the Land parcels or portions thereof. Moreover, development agreements that we enter into or the leases in respect of leasehold lands may impose certain liabilities and obligations on us or may be subject to fulfilment of certain conditions. For instance, in some cases, we may be required to

obtain the necessary legal and regulatory approvals for the execution of a project.We may enter into joint ventures and other similar arrangements with third parties for the joint development of the Land parcels in the future. The terms of some of these agreements may require us and our partner to take the responsibility for different aspects of the project. For instance, we may be required to incur certain costs related to development of the project while our joint venture partner may be responsible for obtaining the regulatory approvals for the project. In the event that any of the conditions to which we are subject pursuant to the joint development agreements are not satisfied, the land may not be developed in a timely manner or at all.

The success of the development of the Land parcels will be significantly dependent on the satisfactory performance by our joint development and joint venture partners. If these entities fail to perform their obligations satisfactorily, we may be required to make additional investments, become liable or responsible for the obligations of these entities in the project or be subject to litigation by such partners, which could result in reduced profits or, in some cases, significant losses and a diversion of our management’s attention and time.

The inability of a joint development or joint venture partner to continue with a project due to financial or legal difficulties could mean that we would bear increased, or possibly sole, responsibility for the development of the relevant project. This may have a material adverse effect on our business, financial condition and results of operations.

We are subject to extensive government regulation and if we fail to obtain, maintain or renew our statutory and regulatory licenses, permits and approvals required to operate our business, our business and results of operations may be adversely affected

HUMAN RESOURCE DEVELOPMENT

Our Company as on date only has Five employees and on boarded few consultants for handling work. However, with we are planning to engage more human resource for smooth functioning of operations.

DISCLOSURE OF ACCOUNTING TREATMENT

The financial statements of the Company have been prepared in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014. Our Company has not taken any treatment which is different from the applicable Ind AS. The fact has been disclosed in Standalone Financial statements

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

HPIL has in place adequate internal financial controls with reference to financial reporting in compliance with the provisions of Section 134(5) (e) of the Companies Act, 2013 and such internal financial controls over financial controls were operating effectively. Internal Financial Controls over

FINANCIAL PERFORMANCE

The following table sets forth certain information with respect to our results of operations as per our Financial Statements for the periods indicated:

( Rs. in Lakhs)

Particulars

:FY 2022-23

:FY 2021-22

:FY 2020-21

Amt

% of Total Revenue

Amt

% of Total Revenue

Amt

% of Total Revenue

REVENUE

Revenue from operations

200.20

23.47

-

-

-

-

Other income

652.64

76.53

315.98

100

36.5

100

Total Revenue

852.84

100

315.98

100

36.5

100

EXPENDITURE

Employee benefitsexpenses

34.48

4.04

26.00

8.23

10.80

29.58

Finance cost

668.50

78.39

581.97

184.18

131.68

360.76

Depreciation, amortization expenses and Other expenses

950.87

111.49

1571.88

497.47

902.39

2472.30

Total Expenses

1653.85

193.92

2179.84

689.87

1044.88

2862.68

Profit before exceptional and extraordinary items and tax

(801.01)

(1863.86)

(1008.38)

Exceptional items

-

-

Tax Expenses

-

-

Current tax

-

-

Deferred tax

(153.70)

(377.81)

(263.04)

Total Tax expenses

(153.70)

(377.81)

(263.04)

Profit for the Period

(647.31)

(1486.05)

(745.34)

KEY FINANCIAL RATIOS

The details of Financial Performance with respect to Operational Performance has been fully explained in the Directors’ Report

Information pursuance to schedule-V of SEBI (LODR) Regulations 2015 - (i) There is no significant changes (change of 25% or more as compared to the immediately previous financial year) in key financial ratios viz. Debtors Turnover Ratio , Inventory Turnover Ratio), Interest Coverage Ratio, Current Ratio (Debt-Equity Ratio,

Operating profit margin and Net profit margin during the year 2022 -23 as compared to the previous year 2021-22.

ii. The Key ratios are as under:

Particulars

Financial Ratios

Explanation

FY 2022-23

FY 2021-22

Debtors Turnover

-2247.71

-

-

Inventory Turnover

-

-

-

Interest Coverage Ratio

(0.19)

(2.20)

The company has generated revenue from operations during the FY 2022-23. Interest Coverage Ratio has decreased due to decrease in loss before tax. The loss before tax is reduced .

Current Ratio

0.19:1

0.23:1

The current ratio has changed due to utilising the funds to meet working capital requirements.

Debt Equity Ratio

1.942:1

1.959:1

The debt equity ratio is declining due to discharge of liabilities of the Company..

Operating Profit Margin(%)

Net Profit Margin (%)

(323.33)

The Company has generated the revenue in FY 2022-23. There was no revenue in FY 2021-22.

CAUTIONARY STATEMENT

The above Management Discussion and Analysis contains certain forward-looking statements within the meaning of applicable security laws and regulations. These pertain to the Company’s future business prospects and business profitability, which are subject to several risks and uncertainties and the actual results could materially differ from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties, regarding fluctuations in earnings, our ability to manage growth, competition, economic growth in India, ability to attract and retain highly skilled professionals, time and cost over-runs on contracts, Government policies and actions with respect to investments, fiscal deficits, regulations etc. In accordance with the Regulations on Corporate Governance as approved by the Securities and Exchange Board of India, shareholders and readers are cautioned that in the case of data and information external to the Company, no representation is made on its accuracy or comprehensiveness, though the same are based on sources thought to be reliable. The Company does not undertake to make any announcement in case any of these forward-looking statements become materially incorrect in future or update on any forward-looking statements made from time to time on behalf of the Company.