hindoostan mills ltd Directors report

Dear Members,

Your Directors are pleased to present the 119^th Annual Report together with the Audited Financial Statements for the year ended March 31, 2023.

FINANCIAL RESULTS

The Companys financial performance, for the year ended March 31, 2023 is summarized below: (Rs. in lakhs)

	Current Year	Previous Year
	Ended	Ended
	31.03.2023	31.03.2022
Gross Profit/(Loss) before	(246.21)	483.81
Interest, Depreciation, and Tax
Less: Interest Cost	43.14	14.97
Gross Profit/(Loss) afterinterest	(289.35)	468.84
but before Depreciation and tax
Less: Depreciation	391.14	535.30
Profit/(Loss) beforeTax	(680.49)	(66.46)
Less: Tax adjustment of earlier	0.00	(259.85)
years
Profit/Loss after Tax	(680.49)	(326.31)
Other comprehensive income/	4.96	10.20
(Loss)
Total comprehensive income/	(675.53)	(316.11)
(Loss)	=========	=========

REVIEW OF OPERATIONS

The revenue from operations of the Company for the financial year 2022-23 was Rs. 9908.60 Lacs as against Rs. 10,374.43 Lacs of the previous year.

Textile companies are facing the situation of under utilization and poor margin realization. Rising inflation and interest rate in the economy has led to reduction in consumer spending. Continuous drop in demand of fabrics led to lower utilization of spinning mills. This has double effect on profitability price corrections on sale of fabrics and yarn were necessitated due to competition in the market. One of the major raw materials of the Company is cotton waste generated from spinning mills. Lower utilization of spinning mills has reduced the supply of cotton waste which led to increase in price of raw materials. Labour issue has also affected utilization of installed capacity. The ongoing legal matter and disciplinary actions relating to labour are moving at a slow and steady pace. However, this remains one of the biggest challenges for the Company in the short term.

Continuous war of Russia and Ukraine has reduced international trade; Export markets continued to be at an all time low in terms of demand and asking prices and were unsustainable thereby hitting hard in terms of low utilisation.

Trading sales have been steady with renewed focus on developing new customers. The share of value added products has been maintained in the range of 15-20%. The scope of performance will increase more once we see better demand and resolve the Labour issues.

The Company had followed with the Ministry for subsidy of electricity which was stopped since December 2021 and it succeeded in getting credit of Rs.75 Lacs of the subsidy during the year under review and will be adjusted in the electricity bills which shall be due with effect from February 2023. Engineering division has established ECK Haubold & Laxmi (EHL) brand in Calendar Machine in textile and paper industries including technical textiles. EHL brand made strong foot print in Gujarat, Maharashtra and Tamilnadu market in Premium Calendar Machine sector. It has strengthened its design and service team. The Company participated in India Textiles Machinery Exhibition from December 08, 2022 to December 13, 2022 with live demonstration of Calendar Machine with Cotton Rolls, Polyamide rolls, CHL rolls, Wool paper rolls manufactured by us. The Company has received good response during the said exhibitions and order position is strengthened.

DIVIDEND

In view of losses incurred during the year under review, the

Directors have not recommended dividend for the year ended

March 31, 2023.

FIXED DEPOSITS of the Company. The The Company has not accepted any deposits from the public during the year under review. There are no outstanding deposits remaining unpaid / unclaimed as on March 31, 2023.

DIRECTORS

Mr. Khushaal C. Thackersey, Director of the Company retires by rotation at 119th Annual General Meeting and being eligible offered himself for re-appointment as a Director of the Company. His brief profile as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is part of the Notice convening the Annual General Meeting.

Mr. Chandrahas K. Thackersey has passed away on 06-01-2023.

Board of directors had noted his involvement in the Company for more than fifty years.

Mr. Ashok Desai, the Independent Directors term was up to August 07, 2022. He did not opt for reappointment. The Board appreciated his contributions during the tenure of his director.

COMMITTEES OF THE BOARD

Details of all the Committees, their composition and meetings held during the year are provided in the Corporate Governance

Report, a part of this Annual Report.

INDUSTRIAL RELATIONS

The Company has taken disciplinary action against workers for absenteeism during Covid period from May 08, 2020 till January 18, 2021. Workers have resorted to the Court against the said action.

TRANSFER TO INVESTOR EDUCATION AND

PROTECTION FUND (IEPF)

Your Company has, during the year under review, transferred unpaid dividend of Rs.1,30,880/- pertaining to the financial year

2014-15 which was unclaimed for more than seven years to Investor Education and Protection Fund in compliance with the provisions of Section 125 of the Companies Act, 2013. The Company transferred 1105 equity shares pertaining to unpaid dividend of 2014-15 which was unpaid for more than seven years to IEPF on 24-04-2023.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis. Form AOC-2 giving details of transactions with related parties referred to in sub-section (1) of section 188 is herewith enclosed, marked as Annexure I. The policy on Related Parties Transactions as approved by the Board is uploaded on the Companys website.

COMPLIANCE UNDER THE COMPANIES ACT

1) Annual return

Annual return referred to in sub-section (3) of section 92 has been placed on website of the Company, website address https://www.hindoostan.com/downloads/#Annual-Return

2) No. of Board meetings

Five Board Meetings were held during the year.

3) Directors Responsibility Statement

Pursuant to the provisions of Section 134(3) (c) and 134(5) of the Companies Act 2013, the Directors confirms to the best of their knowledge and belief: office (a) that in the preparation of the annual accounts, the applicable accounting standards had been followed and there are no material departures;

(b) that the directors 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 at the end of the financial year and of the profit and loss of the Company for that period;

(c) that the directors had taken proper and for the maintenance of adequate 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) that the directors have prepared the annual accounts on a going concern basis; (e) that the directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; and (f) 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.

4) Declaration from Independent directors

All the Independent Directors have given declarations that they meet with the criteria of Independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and under SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015.

5) Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy on directors appointment and remuneration including criteria for determining qualifications, positive attributes, of a director, appointment of Directors, Key Managerial Personnel, Senior Management and to fix/review their remuneration. Policy is on the Companys website www. hindoostan.com.

6) Particulars of Loans, Guarantees or Investments

The Company has not given any loan and guarantee nor made any investments under Section 186 of the Companies

Act, 2013.

7) Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit Committee, Stakeholder Relationship Committee and Nomination & Remuneration Committee.

8) Information under section 197 i. The information required pursuant to Section 197 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given below: There was no employee drawing remuneration of Rs. one Crore and two Lacs during the year or Rs.8,50,000/- per month for a part of the year covered under Section

197 of the Companies Act, 2013 read with Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. ii. The ratio of the remuneration of the Executive Directors to the median remuneration of the employees of the

Company for the financial

Mr. Khushaal Thackersey	18.5
Mr. Abhimanyu Thackersey	18.5

iii. The percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any, in the financial year.

Directors, Chief Executive	% increase in
Officer, Company Secretary	remuneration in
or Manager	the financial year
Mr. Khushaal C. Thackersey,	0.00
Executive Director
Mr. Abhimanyu J. Thackersey,	0.00
Executive director
Ms. Shraddha Shettigar, CFO	5.30
Mr. Kaushik N. Kapasi, CS	4.60

iv. The percentage increase in the median remuneration of employees in the financial year: 4.4% v. The number of permanent employees on rolls of the Company:

- 274 employees as on March 31, 2023 vi. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.

Average Salary Increase for KMPs	1.50%
Average Salary Increase for non-KMPs	4.74%

vii. Affirmation that the remuneration is as per the Remuneration policy of the Company.

The remuneration paid to employees of the Company is as per the remuneration policy of the Company. viii. The statement containing names of top ten employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rules 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in a separate Annexure forming part of this Report and the accounts are being sent to the .

Members excluding the aforesaid Annexure. In terms of Section 136 of the Act, the said Annexure is open for inspection at the Registered Office of the Company. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary.

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

A. Conservation of energy i. Steps taken by the Company for utilizing alternate sources of energy: -

- Nil ii. The Capital investment on energy conservation equipment.

- Nil

B. T echnology absorption

i) the efforts made towards technology absorption

- Nil

ii) the benefits derived like product improvement, cost reduction, product development or import substitution;

- Nil

C. For eign Exchange Earnings & Outgo:

Particulars	31.03.2023	31.03.2022
Foreign exchange earned (Rs. Lacs)	839.10	1578.41
Foreign exchange used (Rs. Lacs)	484.31	199.72

RISK MANAGEMENT POLICY

The Company has evolved risk management policy identifying primary risk and secondary risk. Primary risk includes manpower development, product efficiency, fluctuation in price of raw materials and competition. Although the profitability of the Company may be affected on account of these risk factors, Board has not identified any risk which threatens the existence of the Company. Financial risk management is mentioned in Note no. 33 (VII) of Notes to Accounts, please refer page no. 96 to 100 of the Annual Report.

CORPORATE GOVERNANCE

The Company is maintaining the standards of Corporate Governance and adheres to the corporate governance requirements set out by SEBI. The Report on Corporate

Governance as stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is an integral part of this Report. The requisite certificate from M/s. K.

C. Nevatia & Associates, Practicing Company Secretaries confirming compliance with the conditions of corporate governance is attached to the Report on Corporate Governance.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

In terms of the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors of your Company has reconstituted a Corporate Social Responsibility (CSR) Committee consisting of Mr Khushaal C. Thackersey, Mr. Sujal A. Shah and Mr. . Bhavesh V Panjuani. The Committee has formulated and . recommended to the Board a CSR Policy indicating the activities to be undertaken by the Company, which has been approved by the Board and the same is available on your Companys website, www.hindoostan.com.

In view of the loss during the immediately preceding financial year i.e. 2021-22, the Company was not required to spend any amount on CSR activities during the FY 2022-23. Since there was no CSR activity, annual report on CSR activities is not enclosed.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / COURTS, IF ANY

There is no significant material order passed by the Regulators / Courts which would impact the going concern status of your Company and its future operations.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work perform by the internal, statutory and secretarial auditors, including audit of internal financial controls over financial reporting by the statutory auditors, and the reviews performed by the Audit Committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during financial year 2022-23.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. The Vigil Mechanism Policy is available on your Companys website https://www. hindoostan.com/downloads/#Policies-download .

AUDITORS Statutory Auditors

The Board has duly reviewed the Statutory Auditors Report on the Accounts. The observations and comments appearing in the Auditors Report are self-explanatory and do not call for any further explanation / clarification by the Board.

Cost Auditors

The Board has re-appointed Mr. Pranav J. Taralekar, Cost Auditor to conduct cost audit of the cost records of the Company for FY 2023-24 on the remuneration of Rs.1,05,000/-. The Board has recommended to the Members to ratify the said remuneration.

Secretarial Audit

The Board has appointed M/s. PRS & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure-II. The observations and comments appearing in the Secretarial Auditors Report are self-explanatory and do not call for any further explanation / clarification by the Board.

SEXUAL HARASSMENT

The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year under review, there were no cases filed pursuant to Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

ACKNOWLEDGEMENT

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the Banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Companys executives, staff and workers.

For and on behalf of the Board of Directors,

Abhimanyu J. Thackersey	Khushaal C. Thackersey
Executive Director	Executive Director
DIN: 00349682	DIN: 02416251

Place: Mumbai Date: 16-05-2023

Annexure-I Form No. AOC-2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto

1. Details of contracts or arrangements or transactions not at arms length basis - Nil

2. Details of material contracts or arrangement or transactions at arms length basis

a Name(s) of the related party and nature of relationship	Bhor Chemical and Plastics Private Limited (Bhor) Relationship Mr. Abhimanyu Thackersey, Executive director is a director/ shareholder of Bhor	Bhor Chemical and Plastics Private Limited (Bhor) Relationship Mr. Abhimanyu Thackersey, Executive director is a director/shareholder of Bhor	Bhor Chemical and Plastics Private Limited (Bhor) Relationship Mr. Abhimanyu Thackersey, Executive director is a director/shareholder of Bhor	Bhor Chemical and Plastics Private Limited (Bhor) Relationship Mr. Abhimanyu Thackersey, Executive director is a director/shareholder of Bhor	Bhor Chemical and Plastics Private Limited (Bhor) Relationship Mr. Abhimanyu Thackersey, Executive director is a director/shareholder of Bhor
b Nature of contracts/ arrangements / transactions-	Sale, purchase or supply of any goods or materials, properties, rendering any service, for Bhor, to get any service from Bhor and to get job work done by Bhor,	To undertake Job work for weaving, warping, pultrusion etc.	To sale machineries in tranches, the book value of which is of Rs.42.38 Lacs as on September 30, 2022	To sale Carbon fabrics and other products of the Company to Bhor and To purchase the required yarn and packing materials from Bhor in ordinary course of business and on an Arms Length basis;	To offer sale of Machineries and other assets in tranches , the book value of which are of Rs. 113.58Lacs as on January 20, 2023
c Duration of the contracts / arrangements / transactions-	One year from 1-04- 2022 to 31-03-2023	One year from 1-04- 2022 to 31-03-2023	Not applicable since transaction is not of continuous nature	One year from 01.04.2022 to 31.03.2023	Not applicable since transaction is not of continuous nature
d Salient terms of the contracts or arrangements or transactions including the value, if any:	Omnibus approval for Rs. One Crore during the financial year 2022- 23 plus reimbursement of expenses that may be incurred by Bhor on behalf of HML on an Arms Length basis	Approval up to Rs. Two crores plus reimbursement of expenses that may be incurred by Bhor on behalf of HML on an Arms Length basis	At consideration totaling Rs. 47 Lacs, the fair value of which as per the valuer is of Rs.46 Lacs	For sale of carbon fabrics up to Rs.500 Lacs; for purchase of yarn and packing materials upto Rs. 25 Lacs	At consideration not less than present value of machineries and other assets aggregating to Rs. 117.68 Lacs
e Date(s) of approval by the Board, if any:	08-02-2022	08-02-2022	12-11-2022	02-01-2023	09-02-2023
f Amount paid as advances, if any:	nil	nil	nil	nil	nil