Hindustan Fluoro Carbons Ltd Directors Report

Your Board of Directors takes pleasure in presenting their 43^rd Annual Report on the performance of the Company, together with the Audited Annual Accounts for the year ended 31^st March, 2026 and reports of the Statutory Auditors and the Comptroller and Auditor General of India thereon.

1. FINANCIAL RESULTS

The financial performance of the Company for the year ended 31^st March, 2026 is summarized below: (Rs. in lacs)

Particulars	2025-26	2024-25
Revenue from operations	0.00	0.00
Other income	145.61	212.45
Total Income	145.61	212.45
Total expenditure	114.38	169.98
Profit/(Loss) before tax from discontinued operations	31.23	42.47
Other Comprehensive income/(loss)	0.00	0.00
Total comprehensive income/(Loss)	31.23	42.47

2. RESERVES

Company has not transferred any amount to reserves due to continuous losses.

3. DIVIDEND

The Board of Directors did not recommend any dividend on the equity shares for the year ended 31^st March, 2026 as HFL had stopped its operations and in the process of closure.

4. OPERATIONS AND OVERALL PERFORMANCE

Pursuant to CCEA order for closure and shutting of operations, HFL had stopped its operations.

5. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION OF THE COMPANY:

i. DECISION FOR CLOSURE OF HFL

HFL Board at its meeting held on 30.07.2019, after considering all options, concluded that sustainable operations of HFL is not feasible and recommended for closure of the unit subject to approval of the administrative Ministry. The Board of HOCL, parent company of HFL, at its meeting on 09.08.2019 has also given ‘in principle approval for closure of HFL subject to approval of Administrative Ministry.

ii. CCEA APPROVAL

HFL had received letter from Ministry of Chemicals and Fertilizers, Department of Chemicals and Petro chemicals vide File. No. 9-5101506/2019-Ch.III dated 29.01.2020 informing the decision of Cabinet Committee on Economic Affairs (CCEA) for closure and shutting of operations of HFL.

HFL has received approval of shareholders for the shutting down of the plant/unit and closure of the company and to sell or otherwise dispose of the whole or substantially the whole of the undertaking of the company through postal ballot notice dated February 10, 2020.

iii. SALE/DISPOSAL OF HFL FREEHOLD LAND

HFL is in the process of sale of land and the subject to receipt of NOC from TSICC/TS Govt.

iv. PLANT AND MACHINERY AND OTHER MOVABLE ASSETS

Sale of Plant & Machinery and other movable assets was done through MSTC as per decision taken by CCEA on 29.01.2020 and was executed as per DPE guidelines. HFL has only one plant/unit located at Rudraram, District Sangareddy in Telangana.

v. RECEIPT OF GOI INTEREST FREE LOAN

HFL had received for interest free loan of Rs.75.87 crore from GoI for closure related activities. As per GoI order HFL to utilize funds for payment of liabilities viz. VRS/VSS to existing employees, Clearing liabilities of Ex- employees, Statutory dues and secured / unsecured creditors, etc. related to shutting down of plant / unit of HFL as per CCEA decision dated 29.01.2020. vi. VRS 2020 SCHEME The VRS-2020 scheme is implemented in the company vide Part-I Order No.01/2020, Dated: 19.02.2020, accordingly the employees were relieved on 30-May-2020 (30), 30-Jun-2020 (25) 20 -Jul-2020(9) and 31.07.2021 (1), 16 employees got superannuated, one employee left the organisation on lien, 02 employees were resigned and other 05 employees were transferred to Hindustan Organic Chemicals Limited (HOCL). vii. Delisting The equity shares of HFL has been delisted from the stock exchange i.e BSE w.e.f 06.02.2026.

6. SHARES

There was no change in the equity share capital of the company during the year. The Authorized Share Capital of the company is Rs. 21,00,00,000 and the paid-up capital of the company is Rs.19,59,91,000. During the period under review, the company has not: (i) bought back any of its securities (ii) issued any sweat equity shares (iii) issued any bonus shares (iv) provided any stock option scheme to employees.

7. THE RIGHT TO INFORMATION ACT, 2005.

In consonance with the provisions of the Right to information Act, 2005, Company has appointed Appellate Authorities/ Public Information officer at the office of the company to respond effectively to the request of the applicants under the acts in synchronization with the direction of Central Information Commission (CIC), for promotion of Institutional transparency within the public authority through proactive and effective implementation of section 4 of the RTI Acts, 2005.

The number of RTI applications received and disposed off during the year 2025-26 is given below:

Total number of RTI applications received during the year 2025-26	Nil
Applications rejected during the year 2025-26, if any	Nil
Information submitted during the year 2025- 26	Nil
Pending to reply as on 31.03.2026	Nil

8. INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

The company was not required to transfer any amount towards IEPF

9. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW

The Board of Directors met six (6) times during the financial year 2025-26 on: 15^th May, 2025; 7^th July 2026; 12^th August, 2025; 12^th November, 2025; 29^th January, 2026 and 11^th February, 2026.

10. BOARD OF DIRECTORS

Changes in the Board of Directors during the year is given below:

Shri Sangram Kumar Mishra was given additional charges as Managing Director w.e.f 08.10.2025. Pursuant to the provisions of Section 203 of the Companies Act, 2013 the Key Managerial Personnel of the Company as on March 31, 2025 are: 1. Shri. P O Luise, Chief Financial Officer; 2. Shri Subramonian H, Company Secretary.

11. COMPANYS POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION The Company being a CPSE, appointment of all the Directors on the Board of the Company are made by the Government of India/President of India and under the supervision, control and directions of the Department of Chemicals & Petr-Chemicals (DCPC) and by parent company (HOCL) and the prescribed DPE Guidelines are also followed.

12. COMPANYS POLICY RELATING TO APPOINTMENT AND PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES OF KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES

Company being a CPSE, appointments of all the Directors on the Board of the Company are made by the Govt. of India/President of India and under the supervision, control and directions of the Department of Chemicals & Petrochemicals and the prescribed DPE Guidelines are being followed.

13. FORMAL ANNUAL EVALUATION OF PERFORMANCE OF BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

The Company being a CPSU is governed by the DPE Guidelines and the Annual Evaluation of Performance of Board, its committees and of individual Directors are carried out by the Administrative Ministry.

14. RATIO OF DIRECTORS REMUNERATION TO MEDIAN EMPLOYEES REMUNERATION AND OTHER PRESCRIBED ELABORATE DISCLOSURES AND DETAILS

The Company being a CPSE which is under the supervision, control and direction of the Administrative Ministry the prescribed DPE Guidelines are being followed in respect of employees remunerations and DPE Guidelines are being followed, as regards other prescribed Perquisites 15. TRAINING OF BOARD OF DIRECTORS: The company furnishes set of documents and booklets to the Directors on their joining the Board. This includes important data about the performance of the Company, Memorandum & Articles of Association, Corporate Governance guidelines, Delegation of powers, Product line brochures etc. A copy of the monograph on position, duties and liabilities of Directors is also circulated among the Directors. Besides, the Directors also attend various training/workshops organized by the Department of Public Enterprises (DPE).

16. INDEPENDENT DIRECTORS DECLARATION

There were no Independent Directors on the Board during the year under review. Accordingly, the provisions of Section 149(7) of the Companies Act, 2013, relating to declarations by Independent Directors, were not applicable to the Company.

17. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO: Information in accordance with the provisions required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 Regarding Conservation of energy, Technology Absorption and Foreign Exchange Earning and outgo are given at Annexure I, Form A and B to this Report.

18. RESEARCH & DEVELOPMENT:

As the company is in the process of closure of operations, R&D operations were not carried out during the period.

19. INDUSTRIAL RELATIONS

As on 31.3.2026, there are no employees in the rolls of your company.

20. ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 of the Companies Act 2013, read with Section 92 (3) and Rule 12 of the Companies (Management and Administration) Rules, 2014 an extract of the

Annual Return as at March 31, 2026 is available in the website of the company at http://www.hfl.co.in/investors

21. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with the provisions of Companies Act read with DPE guidelines, the Management Discussion and Analysis Report is annexed hereto in Annexure II and forms part of the Directors Report.

22. DIRECTORS RESPONSIBILITY STATEMENT

In accordance with the provisions of Section 134(5) of the Companies Act, 2013 the Board hereby submit its responsibility statement:

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

b) 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;

c) 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;

d) Cabinet Committee on Economic Affairs [CCEA], Government of India has approved the closure and shut down of operations of the Company. Accordingly, company is no longer a Going Concern Entity and

e) 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. Internal financial control means the policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of its business including adherence to Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation of reliable financial information.

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

23. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES The Company do not have any Subsidiary, Joint venture or Associate Company.

24. DEPOSITS

The Company has neither accepted nor renewed any deposits during the year under review and the company has not accepted any deposits during the previous years

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

There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

26. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

There were no contract or arrangements made with related parties as defined under Section 188 of the Companies Act, 2013 during the year under review accordingly disclosure in form AOC 2 is not required.

27. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS U/S 143 OTHER THAN THOSE REPORTABLE TO CENTRAL GOVERNEMENT:

During the year, no frauds were reported by the auditors and the same is not applicable to the company.

28. CORPORATE SOCIAL RESPONSIBILITY:

As the Company is making Continuous losses and the company is in the process of closure the provision of Section 135 of the Companies act related to the CSR is not applicable to the Company for the financial year 2025-26.

29. RISK MANAGEMENT

As the company is in the process of closure, risk management and risk management committee is not applicable for the Company.

30. VIGILANCE

With the approval of the Ministry, an officer of the company has been nominated as "Vigilance Officer" (Part time) from amongst the Officers of the Company to take care of Vigilance functions. Vigilance activities have mainly been directed to check the improvements in the existing systems and procedures through periodic checks and to encourage preventive vigilance. The instructions of the Central Vigilance Commission received from time to time have been implemented to strengthen the vigilance machinery in the company. There is part time Vigilance Chief Vigilance Officer in HFL.

31. MATERIAL ORDERS OF JUDICIAL BODIES/ REGULATORS

In the case of Rockwell Industries Limited vs. HFL, the High Court vide Order Dated: 02.11.2022 (Case No. COM.C.A. 16/2020) has directed HFL (Appellant) permitted to dispose of the plant, machinery and other equipment through Metal Scrap Trading Corporation Limited, a Central Government corporation. The appellant shall furnish the inventory of plant, machinery and other equipment to decree holder and decree holder shall also be put on advance notice of date of conducting of auction. After successful auction, the appellant shall inform the amount realised from out of the sale proceeds to the decree holder; shall open a separate bank account and the proceeds of auction shall be kept in a fixed deposit in said bank account and said bank account shall not be operated without orders of this Court. As per the directions of the High Court, the sale proceeds of Plant & Machinery are kept in separate bank account. On 12.06.2025, Case No. COM.C.A. 16/2020 was allowed by the Honble Hight Court. HFL is following up with the advocates for facilitating the early disposal of this litigation.

32. AUDITORS:

The Statutory Audit for the FY 2025-26 of your Company was conducted by M/s. AVRSK & Associates LLP, Chartered Accountants who were appointed as Statutory Auditors for the Financial year 2023-24 by Comptroller and Auditor General of India (C&AG) as per Section 139(5) of the Companies Act, 2013, Auditors Report on the Accounts of the Company for the financial year ended 31^st March, 2026 forms part of Annual Report. The fee towards statutory audit is Rs.1,15,000/-. For the FY 2025-26. 33. EXPLANATIONS IN RESPONSE TO AUDITORS QUALIFICATIONS

The Statutory Auditors has given unqualified report. The comments of the Comptroller and Auditor General of India u/s 143(6)(b) of the Companies Act, 2013 on the accounts of the company for the year 2024-25 is annexed to the Annual Report. C&AG have decided not to undertake the supplementary audit on the financial statements of the Company.

34. COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has generally complied with the Secretarial Standards issued by the Institute of Company Secretaries of India.

35. THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITIONAND REDRESSAL Act, 2013

The company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. Company has not received any case relating to the sexual harassment of women at work place.

Annual Report for the year 2025 The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013-:

No. of complaints received:	Nil
No. of complaints disposed of:	Nil
No. of cases pending for more than 90 days:	Nil

36. HEALTH AND ENVIRONMENT

Your Company has shut down the factory/plant. There are no production activities. Therefore, compliance relating to pollution norms are not applicable.

37. IMPLMENTATION OF OFFCIAL LANGUAGE POLICY

During the year under report, your Company continued to promote Hindi as official Language in day to day working in line with the Government policies for its intensive and extensive efforts for progressive use of the official language.

38. PARTICULARS OF EMPLOYEES:

There are no employees in HFL. Therefore, this disclosure is not applicable.

39. LEGAL COMPLAINCE

The Company has complied with all the applicable legal provisions effectively during the year 2025-26.

40. TRADING AND DEMAT FACILITIES FOR SHARES

This is not applicable, as the equity shares of the company is delisted from BSE.

41. COMPLIANCE OF DPE GUIDELINES & POLICIES

The Guidelines & policies issued by the Department of Public Enterprises from time to time are being complied with and implemented with the approval of the Board of Directors/ Competent Authority.

42. CODE OF CONDUCT

The Company has adopted "Code of Conduct and Ethics" for the Directors and Senior Executives of the Company as per DPE guidelines and as per HOCL (Parent Company). The object is to conduct the Companys business ethically and with responsibility, integrity, fairness, transparency and honesty.

43. ACKNOWLEDGEMENTS

I place on record my appreciation and gratitude to all the employees and others who had extended their support and co-operation during the year to achieve the targeted goals of the Company. In particular I am grateful to various officials of the Govt of India, especially from the Ministry of Chemicals & Fertilizers, Department of Chemicals and Petrochemicals, the Finance Ministry, Ministry of Environment, Forest and Climate Change, Govt. of India, Govt of Telangana, Promoter Company i.e. HOCL and Board Members. I would like to convey my sincere appreciation to our valued customers, suppliers, Statutory Bodies, Investors, our bakers State Bank of India, Statutory/Govt Auditors etc. for the continued support.

	For and on behalf of the Board of Directors
	Sd/-
	Sangram Kumar Mishra
	Managing Director
Place: Kochi, Kerala
Date: 06.08.2026