H. S. India Ltd

To,

The Members,

Your Directors are pleased to present the 35^th Annual Report of your Company together with the Audited Financial Statements and Auditors' Report for the year ended 31^st March, 2024.

1. FINANCIAL RESULTS: (' in Lakh)

2. OPERATIONS:

The total revenue of your Company for the year 2023-24 was increased to Rs. 2636.96 lakh as against Rs. 2461.68 lakh of the previous year. The Company reported net profit after tax of Rs. 133.16 lakh for the year 2023-24 in comparison with a net profit after tax of Rs. 103.50 lakh of the previous year.

During the year, there is no change in nature of business of the Company.

3. TRANSFER TO RESERVE:

For the financial year ended 31^st March, 2024, the Board has not proposed to transfer any amount to Reserves.

4. DIVIDEND:

In order to conserve resources, your Directors have not recommended any dividend on equity shares of the Company.

5. PUBLIC DEPOSITS:

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014 during the year ended on 31^st March, 2024.

6. SHARE CAPITAL:

During the year under review, your Company has not issued any securities.

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):

As on 31^st March, 2024, your Company has Six (6) Directors, which includes Two (2) Executive Directors, One (1) Non-Executive Director (Woman) and Three (3) Independent Directors.

Mr. Ramesh Bansal, Managing Director and CFO (DIN-00086256) of the Company, who retires by rotation and being eligible, was reappointed as a Director in 34^th AGM held on 21.09.2023.

Mrs. Sangita Bansal, Director (DIN-01571275) of the Company is liable to retire by rotation at the forthcoming 35^th AGM and being eligible, offers herself for re-appointment.

On the recommendation of the Nomination and Remuneration Committee, the Board at their meeting held on 05th August, 2024 has proposed to appoint Mr. Mehul Narendrakumar Hingu (DIN-10404685) as Non-executive Independent Director for the period of 5 years w.e.f. 11^th September, 2024 subject to approval o f the members in the forthcoming AGM, who is highly renowned professionals drawn from diverse fields, who bring with their a wide range of skills and experiences to the Board, which enhances the quality of the Board's functioning and its decision making process. The Company and the Board have immensely benefitted from its vast experience, knowledge and strategic insights on various matters relating to Company's business. Considering the enormous contributions of the Directors to the functioning and performance of the Company, the Board was of the unanimous view that it will be in the best interest of the Company to appoint him as Non-executive Independent Director for a term of 5 (five) years and shall not retire by rotation.

Mr. Ramesh Bansal, Managing Director (DIN-00086256) of the Company re-appointed as Managing Director for further period of 3 years w.e.f. 1^st August, 2025 in forthcoming 35^th AGM.

Mr. Pradeep Dhawan (DIN-00519455) Non-executive Independent Director of the Company whose second term shall be completed and ceased to be independent director and chairperson/member of various committees of the Company w.e.f. 11th September, 2024.

Mr. Ramesh Bansal is a Managing Director/CFO, Mr. Pushpendra Bansal is a Managing Director of the Company and Mr. Hitesh Limbani is a Company Secretary of the Company. Hence, the Company has all KMPs as per the provisions of Section 203 of the Companies Act, 2013.

Particulars as per Regulation 36(3) of the Listing Regulations and Secretarial Standard-2 of the General Meeting are enclosed as an Annexure with the notice of 35^th AGM.

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, that he meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16 (1)(b) and Regulation 25 of the Listing Regulations. All the Independent Directors of the Company have registered their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.

As per Regulation 25 (7) of the Listing Regulations, Familiarisation Program has been carried out by the Company for the Independent Directors details of which has been posted on Company's website http://hsindia.in/wp-content/iiploads/2024/2/Final_HSTL_Familiarize_ Program_for_ID_13.02.24.pdf

The Management Discussion and analysis as required under Regulation 34 (2) (e) of the Listing Regulations is annexed as Annexure-1 herewith and forms a part of this report.

In compliance with Regulation 34 (3) of the Listing Regulations, a separate report on Corporate Governance along with a certificate from the Auditors on its compliance is annexed as Annexure-2, forms an integral part of this report.

The information required under Section 197 of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as Annexure-3.

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 Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed as Annexure-4.

As provided under Section 92(3) and 134(3)(a) of the Act, read with Rule 12 of the Companies (Management and Administration) Amendment Rules, 2020, Annual Return in Form MGT-7 for the financial year 2023-24 is uploaded on the Company's website http://hsindia.in/wp- content/uploads/2024/07/MGT-7-2023-24.pdf

During the year under review, 4 (Four) Board Meetings were held as per the requirements of the Act, Listing Regulation, Secretarial Standards and circulars/notifications issued thereon. The details of Board Meetings are given in the Corporate Governance Report.

Details pertaining to the composition of Audit Committee and Other Committees and all meetings were held during the year 2023-24, are given in the Corporate Governance Report.

Pursuant to the provisions of Section 134 (3)(c) of the Companies Act, 2013, the Board of Directors hereby confirms that:

(i) in the preparation of the annual accounts for the financial year ended 31^st March, 2024, the applicable accounting standards have been followed and no material departures have been made for the same.

(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 ended on 31^st March, 2024 and of the profit of the Company for the year ended on that date.

(iii) the Directors have taken proper and sufficient care 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.

(iv) the Directors have prepared the accounts for the financial year ended 31^st March, 2024, on a ‘going concern' basis.

(v) the Directors had laid down internal financial control to be followed by the Company and that such internal financial controls are adequate and operating effectively.

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

Your directors confirm that the Secretarial Standards issued by the Institute of Company Secretaries of India, have been complied with.

The Company's policy relating to Nomination and Remuneration of Directors, Key Managerial Personnel and other Employees as stipulated under Section 178 (4) of the Companies Act, 2013, has been disclosed in the Corporate Governance report.

M/s. K. K. Haryani & Co., Chartered Accountants (Firm Reg. No.-121950W), was appointed as a Statutory Auditors of the Company for a period of 5 years w.e.f. conclusion of the 32 ^nd AGM of the Company till the conclusion of the 37^th AGM of the Company.

The Auditors in their report have referred to the notes forming part of the accounts. The said notes are self-explanatory and do not contain any qualification, reservation or adverse remark or disclaimer. No offence of fraud reported by them under Section 143 (12) of the Act.

M/s. J. Bhavsar & Co., Chartered Accountants (Firm Reg. No. 115613W) at Surat, the Internal Auditors of the Company have conducted periodic audit of all operations of the Company. The Audit Committee has reviewed the findings of Internal Auditors regularly and their repo rts have been well received by the Audit Committee.

Pursuant to the provisions of Section 204 of the Companies Act, 2013, your Company had appointed Mr. Manish R Patel, Company Secretary in Practice at Surat to undertake the Secretarial Audit of the Company for the Financial Year 2023-24. The Secretarial Audit Report (Form No. MR-3) is annexed herewith as Annexure-5. The report does not contain any qualifications, reservation or adverse remarks. No offence of fraud reported by them under Section 143 (12) of the Act.

During the year, your Company does not have any Subsidiaries, Joint Ventures or Associate Companies.

During the year, your Company has not given any loans or guarantees covered under the Provisions of Section 186 of the Companies Act, 2013. The details of the Investment made by the Company are given in the Note no. 3 to the financial statements.

All related party transactions that were entered into during the financial year were in the ordinary course of business and at arm's length basis. All related party transactions were placed before the Audit Committee and the Board for approval. Prior omnibus approval of the Audit Committee has been obtained for the transactions which are of a foreseen and in repetitive nature. Policy on transactions with related parties as approved by the Board is uploaded on the Company's website http://hsindia.in/wp-content/uploads/2021/05/Policy_of_Related_Party_ Transactions_1.pdf

Disclosure of related party transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is annexed as Annexure-8. Suitable disclosure as required under AS-18/Ind-AS-24 has been made in Note no. 35 to the Financial Statement.

25. LISTING ON STOCK EXCHANGE:

The Company's shares are listed with the BSE Limited and the Company has paid the necessary listing fees and custody fees for the Financial Year 2023-24 and 2024-25.

26. MATERIAL CHANGES AND COMMITMENTS:

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

27. REPORT ON CONSERVATION OF ENERGY, ABSORPTION OF TECHNOLOGY AND FOREIGN EXCHANGE EARNING AND OUTGO:

In accordance with the requirement of Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014, your Directors furnish hereunder the additional information as require d.

A. Conservation of Energy:

Your Company has made all possible efforts to closely monitor power consumption on daily basis so as to reduce wastage. The Company is also trying to find ways and means to reduce power consumption and thus reduce the overall energy cost.

Your Company is using PNG (Pipelines Natural Gas) in the Kitchen and other operational areas. Your Company is also using solar panel for water heater, power savers in electric panels and in Guest Rooms with LED fittings. Your Company is also using DG set for utilising alternate sources of energy. During the year, your Company does not have any capital investment on energy conservation equipment.

B. Technology Absorption:

The project of your Company has no technology absorption, hence no particulars are offered.

C. Total Foreign Exchange Earning and Outgo:

28. RISK MANAGEMENT:

Although not mandatory, the Company has constituted a Risk Management Committee as a measure of good governance. The details of the Committee and its terms of reference are set out in the Corporate Governance Report.

A Risk Management Policy was framed and approved by the Board. The objective of this policy is to minimize the adverse impact of various risks attached with the business goals and objectives and to enhance the value of stakeholders.

The Management has put in place adequate and effective system and man power for the purposes of risk management.

Pursuant to the provisions of Companies Act, 2013 and Regulation 17(10) of the Listing Regulations, the Board has carried out an annual performance evaluation of its own performance, Committees and the Directors individually. The manner in which the evaluation has been carried out, detailed below:

The performance evaluation of the Board as a whole, Chairperson and Non Independent Directors was carried out by the Independent Directors. The Independent directors evaluated the parameters viz., level of engagement, duties, responsibilities, performance, obligations and governance safeguarding the interest of the Company. The performance evaluation of Independent directors was carried out by the entire Board.

A diverse Board enables efficient functioning through differences in perspective and skill, and also fosters differentiated thought process at the back of varied industrial and management expertise, gender and knowledge. The Board recognizes the importance of diverse composition and has adopted a Board Diversity Policy which sets out the approach to diversity. The Board Diversity Policy is available on our website http://hsindia.in/wp- content/uploads/2021/05/BoardDiversityPolicy_1.pdf

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is well defined in the organisation. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of Internal Audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and corrective actions suggested are presented to the Audit Committee of the Board.

The Company has adopted Vigil Mechanism / Whistle Blower Policy in accordance with Section 177 (9) of the Companies Act, 2013 and Regulation 22 of the Listing Regulations to deal with instances of fraud and mismanagement, if any. The Vigil Mechanism / Whistle Blower Policy is available on the Company's website http://hsindia. in/wp- content/uploads/2021/05/VigilMechanism.pdf

The Company has complied with the applicable provisions of the POSH Act, and the rules framed thereunder, including constitution of the Internal Complaints Committee.

During the year, the Company has submitted the annual report as per the requirement of Section 21(1) of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to Assistant Labour Commissioner, Surat.

During the year, the Company had not received any complaints and no complaints were pending as on 31^st March, 2024.

During the year, no significant and material order has been passed by the Regulators, Courts and Tribunals impacting the going concern status and Company's operations in future.

Your Company is not required to maintain cost records as specified by the Central Government under Section 148(1) of the Companies Act, 2013.

Provisions relating to Corporate Social Responsibility under Section 135 of the Companies Act, 2013 are not applicable to the Company.

During the year, there were no instances of Onetime Settlement with any Banks or Financial Institutions.

During the year, there was no application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) .

During the period under review, the relations with the most valuable human resources of the Company remained cordial and peaceful. Your Directors wish to place on record their appreciation for the devoted services rendered by the staff of the Company.

Your Directors would like to express their appreciation for the assistance and co-operation received from the Financial Institutions, the Bankers, Government authorities, customers, vendors and shareholders during the year under review. Your Directors also wish to record their recognition of the customer support and patronage by the corporate houses in and around Surat.

Your Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers and staff, which enable the Company to deliver a good all-round record performance.