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Hindusthan Engineering & Industries Limited Unlisted Shares

Annual Report: 2021

Year: 2021

Annual Report Summary

The 2020-2021 Annual Report for Hindusthan Engineering & Industries Limited details the company's financial performance and key activities during the fiscal year ending March 31, 2021. The company has prepared standalone and consolidated financial statements in compliance with the Companies Act, 2013 and relevant accounting standards.

Financial Performance: The report highlights operating results, both standalone and consolidated. The standalone operating results of the company for the year 2020-2021 includes:

  • Profit for the year before depreciation and taxation: Rs. 89,63,98,000 compared to Rs. 51,60,93,000 in 2019-2020.
  • Depreciation for the current year: Rs. 33,21,23,000.
  • Profit Before Tax: Rs. 56,42,75,000 compared to Rs. 19,03,40,000 in 2019-2020.
  • Provision for Income Tax: Rs. 17,92,11,000 (Current Tax) with some adjustments for earlier years and deferred tax.
  • Net Profit after Tax: Rs. 40,15,32,000 compared to Rs. 22,55,60,000 in 2019-2020.
  • Other Comprehensive Income (Net of Tax): Rs. (5,71,20,000).
  • Total Comprehensive Income: Rs. 34,44,12,000 compared to Rs. 24,31,59,000 in 2019-2020.
  • The Board did not recommend a dividend to conserve company resources.

Operational Performance:

  • The company adopted Indian Accounting Standards (IND AS) effective April 1, 2016.
  • The Engineering Division experienced lower sales and profit compared to the previous year.
  • Hindusthan Chemicals Company, the chemical division, achieved higher sales and profit.
  • Dalhousie Jute Company, the jute division, recorded higher sales but lower profit.
  • The COVID-19 pandemic severely disrupted the company's operations.

Corporate Structure & Governance:

  • The paid-up equity share capital as of March 31, 2021, was Rs. 15,00,07,820.
  • Hindusthan Vidyut Corporation Limited (HVCL) is a wholly-owned subsidiary, formed to set up a power plant but has not commenced business activities.
  • The report includes a Directors' Responsibility Statement confirming adherence to accounting standards, policies, and internal controls.
  • Details of changes in Directors and Key Managerial Personnel are provided, including the retirement of Shri R.P. Mody and the passing of Shri Biswajit Choudhuri. Shri Anil Kumar Damari Singh was re-appointed.

Corporate Governance Committees: The report details the composition and attendance of the following committees:

  • Audit Committee
  • Nomination & Remuneration Committee
  • Stakeholders Relationship Committee
  • Corporate Social Responsibility (CSR) Committee
  • An Independent Director's Meeting was held on March 15, 2021.

Corporate Social Responsibility:

  • The company has a CSR policy, focusing on education.
  • The annual report on CSR activities is included as Annexure-1.
  • Rs. 82.50 Lacs was spent for the financial year, primarily on education of girl child in Rajasthan.

Auditors Report:

  • M/s. S. Rastogi & Associates were appointed as Statutory Auditors for a 5-year term.
  • The Auditor's Report includes qualifications related to certain amounts claimed by authorities, loans, trade receivables and advances, and certain reliefs and concessions.

Other Key Highlights:

  • The company is taking steps to recover loans, trade receivables, and advances.
  • No frauds were reported by Auditors.
  • M/s. S. K. Sahu & Associates and Shri Than Mal Rathi have been appointed as Cost Auditors.
  • M/s. MKB & Associates has been appointed as Secretarial Auditor.
  • The Board has adopted a Nomination & Remuneration Policy.
  • The company has formulated a Vigil Mechanism Policy and a Risk Management Policy.
  • 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.

Other Annexures:

  • Annexure-1 details Corporate Social Responsibility Activities
  • Annexure -2 is the Secretarial Audit Report
  • Annexure-3 provides information relating to Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo. The company is exploring the possibilities for use of solar power. The Company has successfully absorbed and adapted technology for the manufacture of various chemicals. Foreign Exchange outgo in terms of actual outflows was Rs. 73,09,50.
  • Net earnings for the Company totalled Rs. 26.77 per share.

In conclusion, the Annual Report reflects a year marked by operational challenges due to the global pandemic, along with increased focus on sustainable practices and responsible corporate governance.

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