High Ground Enterprise Ltd Directors Report.

To,

The Members,

Your Directors have pleasure in presenting the 33rd Annual Report on the business and operations of the Company, together with the audited financial statements for the financial year ended March 31,2018.

HIGHLIGHTS OF FINANCIAL RESULTS

The Companys financial performance, for the year ended March 31,2018 is summarized below:

Particulars

Year ended March 31, 2018 (Rs. In Lacs)

Year ended March 31,2017 (Rs. In Lacs)

Consolidated Standalone Consolidated Standalone
Net Revenue from operations:
Engineering Procurement Construction Management (EPCM) 41,924.86 41,924.86 27,275.07 25,865.02
Media, Consulting and allied services 11,810.12 11,805.27 4,972.53 4,887.86
Total Revenue from operations 53,734.98 53,730.13 32,247.60 30,752.88
Other Income 84.23 78.82 11.72 11.58
Total expense other than Finance Cost, Depreciation and amortization 50,443.96 50,412.75 29,871.70 28,248.25
Earnings before Finance Cost, Depreciation, amortization and tax (EBIDTA) 3375.25 3396.20 2,387.62 2,516.21
Depreciation & amortization 176.72 176.42 116.10 115.38
Earnings before Finance Cost and Tax 3198.53 3219.78 2,271.52 2,400.83
Finance costs (net) 679.86 679.37 483.89 483.63
Profit before tax (PBT) 2518.67 2540.41 1,787.63 1,917.20
Tax expenses 910.67 910.67 665.19 663.50
Profit after tax (PAT) 1608.00 1629.74 1,120.60 1,251.61
Basic earnings per share (?) 1.39 1.42 0.98 1.09
Diluted earnings per share 1.39 1.42 0.98 1.09

DIVIDEND

The Board of Directors of the Company at their meeting held on May 30, 2018 have recommended a dividend of Re. 0.10/- (Ten Paisa) per equity share of Re. 1/- (i.e.10% on the face value of the shares) as final dividend for the financial year 2017-18.

The dividend will be paid to members whose names appear in the Register of Members as on September 18, 2018 and in respect of shares held in dematerialized form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners as on that date.

CORPORATE GOVERNANCE

The Company has vigorously taken steps to follow the best corporate governance practices aimed at building

trust among the key stakeholders, shareholders, employees, customers, suppliers and other stakeholders on four key elements of corporate governance - transparency, fairness, disclosure and accountability and the Certificate from Practicing Company Secretary forms a part of this Report.

OPERATIONS AND BUSINESS PERFORMANCE:

Turnover

During the year ended March 31, 2018 the Companys total revenue is Rs.53,730.13 Lacs as against Rs. 30,752.88 lacs in the previous period.

Analysis of Income from Operations

During the year under review, income from Engineering Procurement and Construction Management was Rs. 41,924.86 Lacs as compared to Rs. 25,865.02 Lacs during the previous year. During the year under review, income from Media consulting and allied services was Rs. 11,805.27 Lacs as compared to Rs 4,887.86 Lacs during the previous year.

Financial Year Sales / Turnover (Rs. In Lakhs)

Percentage of Total Turnover (%)

EPCM Media & Entertainment
2016-17 30.752.88 84.11 15.89
2017-18 53,730.13 78.03 21.97

Other Income

Other income for the year is Rs. 78.82 Lacs against Rs. 11.58 Lacs in the previous year. As was the case last year, for the year under review, Income from foreign exchange fluctuations and interest income are major contributors to other income of the Company.

Other expenses

During the year, other expenses were Rs. 1054.16 Lacs as against Rs. 846.79 Lacs in the previous period. DIRECTORS

Pursuant to sections 149, 152 and other applicable provisions, if any, of the Companies Act, 2013, one-third of such of the Directors are liable to retire by rotation and shall retire every year and, if eligible, offer themselves for re-appointment at every AGM. Consequently, Mr. Sandeep R. Arora (DIN: 02587811), Director will retire by rotation at the ensuing AGM, and being eligible, offer himself for re-appointment in accordance with the provisions of the Companies Act, 2013.

Further during the year under review following directors of the Company have resigned from the Directorship of the Company:

Sr. No. Name of the Director Date of Resignation
1. Mr. Paul Taylor June 9, 2017

The Board places on record its appreciation to the resigned directors, for his valuable guidance provided during his tenure as Director of the Company.

DECLARATION BY INDEPENDENT DIRECTORS: {SECTION 134 (3)(D)}

The Independent Directors of the Company are not associated with the Company in any manner as stipulated under section 149(6) of Companies Act, 2013 and at same time possess relevant expertise and experience that are additive to the Board of the Company for delivering higher growth and higher value.

The brief resume of the Directors being appointed/ reappointed, the nature of their expertise in specific functional areas, names of companies in which they have held Directorships, Committee Memberships/ Chairmanships, their shareholding etc., are furnished in the explanatory statement to the notice of the ensuing AGM.

The Directors recommend their appointment/re-appointment at the ensuing AGM.

Pursuant to the provisions under Section 134(3)(d) of the Companies Act, 2013, with respect to statement on declaration given by Independent Directors under Section 149(6) of the Act, the Board hereby confirms that all the Independent Directors of the Company have given a declaration and have confirmed that they meet the criteria of independence as provided in the said Section 149(6).

KEY MANAGERIAL PERSONNEL

The Key Managerial Personnel (KMP) in the Company as per Section 2(51) and 203 of the Companies Act, 2013 are as follows:

Sandeep Ramkrishna Arora Chairman & Managing Director
Chintan Kapadia Whole time Director & Chief Financial Officer
Arunkumar Tyagi Whole - Time Director
*Unnati A Amodwala Company Secretary & Compliance Officer
#Neha Kothiyal Company Secretary & Compliance Officer

*Ms. Unnati Amodwala has resigned from the post of Company Secretary & Compliance Officer w.e.f. March 31,2018 #Ms. Neha Kothiyal was appointed as a Company Secretary & Compliance Officer w.e.f. April 17, 2018.

PARTICULARS OF REMUNERATION OF DIRECTORS/ KMP/ EMPLOYEES

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, there are NIL employees drawing remuneration in excess of the limits prescribed in the Act.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as ‘Annexure -A which forms part of this report.

BOARD MEETINGS

During the financial year 2017-18, the Board of Directors met 11 (Eleven) times and the date of Board Meeting were May 30, 2017, June 7, 2017, June 20, 2017, August 9, 2017, September 2, 2017, September 11,2017, September 15, 2017, November 13, 2017, December 14, 2017, February 14, 2018, and March 31,2018. The gap between any two meetings has been less than 120 days.

Details of the Board of Directors and Attendance Record of Directors during the financial year ended March 31,2018 is as under:

Name Board Meetings held Board Meetings attended
Sandeep Ramkrishna Arora 11 11
Chintan Arvind Kapadia 11 11
Arunkumar Tyagi 11 11
Anupam Kumar 11 05
Mataprasad Bulakidas Sharma 11 09
Sudhir Vinayak Yashwantrao 11 09
Sonia Khenduja 11 09
*Paul Anthony Taylor 11 00

* Paul Anthony Taylor, has resigned from the Directorship of the Company w.e.f June 9, 2017

SHARE CAPITAL

During the year under review the Company has not issued any securities. The entire share capital of the Company is listed and traded on BSE Limited and National Stock Exchange of India Limited.

Remuneration Policy

The Companys Remuneration Policy for Directors, Key Managerial Personnel, and other employees is available on the website of the Company i.e. www.highgroundenterprise.com

Familiarization Programme

The Company has established a Familiarization Programme for Independent Directors.

As per Reg. 25(7) of SEBI (LODR) In which the Board briefed them about the following points:

a) Nature of the industry in which the Company operates

b) Business model of the Company

c) Roles, rights, responsibilities of independent directors

d) Any other relevant information

RELATED PARTIES TRANSACTIONS

All the transactions with related parties are in the ordinary course of business and on arms length basis. The details of the transactions entered into between the Company and the related parties are given in AOC-2 as Annexure B to this report.

Your attention is drawn to the Related Party disclosures set out in Note no. 2.(15) of the Standalone Financial Statements.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013

During the year under review the Company has not entered into any transactions under section 186 of the Companies Act, 2013. However previous year Un-Quoted Non - Current Investment made by the Company is as follows:

Sr. No. Name of the Entity Particulars of Transaction Amount in Rs.Lacs (2017-18) Amount in Rs. Lacs (2016-17)
1. HGEL Integrated Private Ltd. Investment in Subsidiary Company at cost 1.00 1.00
2. Color Bar Private Ltd. Investment in Subsidiary Company at cost 1.00 1.00
3. Chitra Talent Management Pvt.ltd. Investment in Associate Company at cost 0.49 0.49
4. HGEL International Pte Ltd Investment in Wholly Owned Subsidiary Company- at cost 4.97 3.86

MATERIAL EVENTS THAT HAVE OCCURRED AFTER THE BALANCE SHEET DATE

There is no material Event that have occurred after the Balance sheet date.

SIGNFICANT / MATERIAL ORDERS PASSED IMPACTING ON GOING CONCERN STATUS AND COMPANYS OPERATIONS

There had been no significant / material orders passed against the Company, which shall impact the going concern status.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013 with respect to the directors responsibility statement, it is hereby confirmed that:

(a) in the preparation of the annual accounts for the year ended March 31,2018 the applicable Accounting standards had been followed along with proper explanation relating to the material departures;

(b) the Directors of the Company had 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, as at March 31,2018 and profit of the Company for the year ended March 31,2018.

(c) the Directors of the Company had taken proper and sufficient care for the maintenance of proper accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the Directors of the Company had prepared the accounts of the Company for the financial year ended March 31,2018 on a going concern basis and;

(e) the Directors of the Company had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

STATUTORY AUDITORS AND THEIR REPORT

Pursuant to Section 139 of the Companies Act, 2013, the tenure 5 (Five) years of the Statutory Auditor M/s. Jain Chowdhary & Co., Chartered Accountants (Firms Registration No. 113267W), have been concluded at this Annual General Meeting. The Board of Directors of the Company upon recommendation from the Audit Committee have decided to re-appoint the Statutory Auditor for a further period of 5 years (i.e) the second consecutive term of their appointment as per the provision of section 139(2) of the Companies Act 2013 read with relevant rules mad therein under.

M/s. Jain Chowdhary & Co., have given their consent & eligibility for re-appointment and have stated that their appointment if made at the ensuing Annual General Meeting, would be in accordance within the limit of the Act & that they are not disqualified from being appointed as statutory auditor of the Company.

AUDITORS QUALIFICATION AND BOARDS COMMENT

The Statutory auditors of the Company have not made any adverse remark in their report on the standalone and consolidated financial statements of the Company and the other remark and information mentioned in the auditor report are self explanatory in nature and does not call for any explanation from the Board of Directors.

SECRETARIAL AUDITORS AND THEIR REPORT

Mr. Amit R. Dadheech, Company Secretaries, was appointed as Secretarial Auditors of the Company for the financial year 2017-18. Pursuant to Section 204 of the Companies Act, 2013. The Secretarial Audit Report submitted by them in the prescribed form MR- 3 is attached as Annexure C and forms part of this report.

There are qualifications, observations and other remarks of the Secretarial Auditors in the Report issued by them for the financial year 2017-18 which are self explanatory in nature and does not call for any explanation from the Board of Directors.

NATURE OF BUSINESS

Presently the Company operates in two divisions namely:

Division 1: EPCM (Engineering Procurement and Construction Management)

a) Oil & Gas sector

b) Infra & support services / Consulting Division 2: Allied media services (M&A)

There has been no change in the nature of business of the Company carried out by the Company during the year under review.

SUBSIDIARIES:

The Company two wholly owned subsidiaries, the details of the same are set below:

Sr. No Name of the Subsidiary Date of incorporation Country Business
1. Colour Bar Private Limited March 12, 2015 India Post Production
2. HGEL Integrated Pvt. Ltd January 19, 2015 India infra -projects viz. mining & exploration of natural resources & Stone Mining
3. HGEL International Pte Ltd. January 23,2017 Singapore General Wholesale trade (including general Importers and Exporters)

The statement containing salient features of the financial statement of the above subsidiaries in Form AOC-1 is given in Annexure-D.

These documents shall also be available for inspection at the registered office of the Company during business hours up to the date of the ensuing AGM.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

Pursuant to provisions of Section 134 of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 the details of Conservation of Energy, Technology Absorption, are not applicable to the Company.

Details of Foreign Earning & Outflow are stated below: (Rs. In lakh)

Amount 2017-18 Amount 2016-17
Foreign Earnings 6.77 -15.18
Foreign Exchange Out-flow Nil Nil

CHANGE IN CAPITAL STRUCTURE AND LISTING OF SHARES

The Companys shares are listed on the Bombay Stock Exchange (BSE) Limited & The National Stock Exchange of India Limited. The details of the same are mentioned below as on March 31,2018:

Name of the Stock Exchange Number of shares (Equity) listed on the stock exchange
BSE Ltd (BSE) 115115949
National Stock Exchange of India Limited (NSE) 115115949

The Company has regularly paid all the listing fees to the stock exchange and custodial fees to the depositories. EXTRACT OF THE ANNUAL RETURN

An extract of the Annual Return for the year ended March 31,2018 as provided under sub-section (3) of Section 92 and prescribed under Rule 12 of Companies (Management & Administration) Rules, 2014 is attached as Annexure-E and forms part of this report. However the same is also available st the website of the Company viz. www.highgroundenterprise.com .

CORPORATE GOVERNANCE

As required by the existing Regulation 34(3) of the Listing Regulation, a detailed report on Corporate Governance is included in the Annual Report. The certificate from a practicing company secretary have been obtained for compliance of the requirements of Corporate Governance in terms of Regulation 34(3) of the Listing Regulation and the same is annexed to the Report on Corporate Governance.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Social Welfare Activities has been an integral part of the Company since inception. The Company is committed to fulfill its social responsibility as a good corporate citizen. The Company fulfills the criteria set out in the section 135 of the Companies Act, 2013 and relevant rules stating applicability of the section. However, the Board of Directors of the Company has constituted a CSR Committee under review with 3 (three) of its Board members. Contents of Corporate Social Responsibility Policy in the Boards report are given in the report on CSR activities in Annexure F.

MANAGERIAL REMUNERATION:

Disclosures of the ratio of the remuneration of each director to the median employees remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is within the limits as prescribed under the Companies Act, 2013.The disclosure as required under section 134 of the Companies Act, 2013 read with relevant rules made therein under, is attached as Annexure - A and form part of this report

BOARD COMMITTEES

The Company has the following Committees of the Board:

• Audit Committee

• Stakeholders Relationship Committee

• Nomination & Remuneration Committee

• CSR Committee

The composition of each of the above Committees, their respective role and responsibility is as detailed in the Report of Corporate Governance.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Board of Directors of High Ground Enterprise Limited is committed to maintain the highest standard of honesty, openness and accountability and recognize that employees have important role to play in achieving the goal. The Companys Vigil Mechanism Policy encourages Directors and employees to bring to the Companys attention, instances of unethical behavior and actual or suspected incidents of fraud or violation of the conduct that could adversely impact the Companys operations, business performance and / or reputation. The Policy provides that the Company investigates such incidents, when reported, in an impartial manner and takes appropriate action to ensure that the requisite standards of professional and ethical conduct are always

upheld. It is the Companys Policy to ensure that no employee is victimized or harassed for bringing such incidents to the attention of the Company. The practice of the Vigil Mechanism Policy is overseen by the Board of Directors and no employee has been denied access to the Committee.

INTERNAL FINANCIAL CONTROL

The Company believes that internal control is a necessary concomitant of the principle of prudent business governance that freedom of management should be exercised within a framework of appropriate checks and balances. The Company remains committed to ensuring an effective internal control environment that inter alia provides assurance on orderly and efficient conduct of operations, security of assets, prevention and detection of frauds/errors, accuracy and completeness of accounting records and the timely preparation of reliable financial information.

In compliance of the provision of the Act, the Company has appointed M/s. Kataruka & Associates, Chartered Accountants, as its internal auditor of the Company for the financial year 2017-18.

The Companys independent and Internal Audit processes, both at the Business and Corporate levels, provide assurance on the adequacy and effectiveness of internal controls, compliance with operating systems, internal policies and regulatory requirements.

The Financial Statements of the Company are prepared on the basis of the Significant Accounting Policies that are carefully selected by management and approved by the Board. These, in turn are supported by a set of divisional Delegation Manual & Standard Operating Procedures (SOPs) that have been established for individual units/ areas of operations.

The Company has in place adequate internal financial controls with reference to the Financial Statements. Such controls have been tested during the year and no reportable material weakness in the design or operation was observed. Nonetheless the Company recognizes that any internal financial control framework, no matter how well designed, has inherent limitations and accordingly, regular audit and review processes ensure that such systems are reinforced on an ongoing basis.

RISK & MITIGATION

The Company has identified various risks faced by the Company from different areas. As per the provision of the Companies Act, 2013 and listing agreements, the, the Board had adopted a risks management policy whereby a proper framework is set up. Appropriate structures are present so that risks are inherently monitored and controlled. A combination of policies and procedures attempts to counter risks as and when they evolve.

COST AUDITORS

As the Company is operating in the service industry, cost audit is not applicable to the Company and hence no reporting is required.

DISCLOSURE ON DEPOSIT UNDER CHAPTER V

The Company has neither accepted nor renewed any deposits during the Financial Year 2017-18 in terms of Chapter V of the Companies Act, 2013

DISCLOSURE AS REQUIRED UNDER SECTION 22 OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company is committed to provide a protective environment at workplace for all its women employees. To ensure that every woman employee is treated with dignity and respect and as mandated under The Sexual

Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013" the Company has in place a formal policy for prevention of sexual harassment of its women employees.

The following is the summary of sexual harassment complaints received and disposed off during the current financial year.

Number of Complaints received: NIL Number of Complaints disposed off: NIL

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERNS STATUS AND COMPANYS OPERATIONS IN FUTURE

The Company has not received any significant or material orders passed by any Regulatory Authority, Court or Tribunal which shall impact the going concern status and Companys operations in future.

INDUSTRIAL RELATIONS:

The Company maintained healthy, cordial and harmonious industrial relations at all levels the enthusiasm and unstinting efforts of employees have enabled the company to remain at the leadership position in the industry it has taken various steps to improve productivity across organization.

ACKNOWLEDGEMENTS:

Your Directors place on record their gratitude to the Central Government, State Governments and Companys Bankers for the assistance, co-operation and encouragement they extended to the Company. Your Directors also wish to place on record their sincere thanks and appreciation for the continuing support and unstinting efforts of investors, vendors, dealers, business associates and employees in ensuring an excellent all around operational performance.

Date: September 1,2018 Place: Mumbai

Regd. Office:

Office No. 2, Om Heera Panna Mall, 2nd Floor, Oshiwara,

Andheri (West)

Mumbai- 400053

By Order of the Board

For High Ground Enterprise Limited

Sd/-

Sandeep R. Arora

Chairman & Managing Director (DIN: 02587811)