Directors Report of Hindustan Organic Chemicals Ltd.

Mar 31, 2025

The Board of Directors presents herewith the 64^th Annual Report of your
Company along with the Audited Statement of Accounts for the financial year
2024-25.

1. FINANCIAL RESULTS

The financial results for the year ended 31.03.2025 with the comparative
figures of company''s operations for the previous year is as under:

(Rs. in Lakhs)

Particulars	2024-25	2023-24
Revenue from operations	53,586.76	70,389.00
Other Income	2,275.11	1,669.10
Total	55,861.87	72,058.10
Expenditure	66,650.12	77,589.80
Profit/ (loss) before exceptional item & Tax	(10,788.25)	(5,531.70)
Less: Exceptional items	50,275.38	-
Profit /(Loss) before Tax	39,487.13	(5,531.70)
Less: Tax expenses	333.00	-
Profit/(Loss) after Tax	39,154.13	(5,531.70)
Other Comprehensive Income for the year, net of tax	(378.44)	5,919.70
Total Comprehensive Income for the year	38,775.69	388.00

2. MEMORANDUM OF UNDERSTANDING WITH GOVERNMENT OF
INDIA

Company has been exempted from submitting Memorandum of
Understanding (MOU) with the Ministry of Chemicals & Fertilizers,
Government of India, for the financial year 2024-25.

3. CONSOLIDATED FINANCIAL STATEMENT

In accordance with the provisions of the Companies Act, 2013 (“the
Act”) and IND AS 110 - Consolidated Financial Statement, the audited
consolidated financial statement for the period ending 31.03.2025 is
provided in the Annual Report.

4. DIVIDEND

During the current year, HOCL has earned profit mainly due to writing
off of Government of India dues amounting to Rs. 1,351.37/- crore.
Accordingly, the profit achieved is not from the revenue generated
through the business. Hence, the Board of Directors do not recommend
any Dividend for the year under review.

5. CHANGE IN NATURE OF BUSINESS IF ANY

There was no change in the nature of business of the Company during
the FY 2024-25.

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.370 crores
and the paid-up equity capital of the company is Rs.67.27 crores. The
company''s equity shares are listed in BSE (Scrip ID: 500449). 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.
The Government of India dues including the Preference Shares were
waived off on 21.03.2025. Accordingly, company is in the process of
reducing preference shares from the total paid-up capital.

7. FINANCIAL HIGHLIGHTS

During the year 2024-25, the company has achieved a Gross Income
of Rs.558.61/- crore against Rs.720.58/- crore during the previous year
registering a decline of 22.47%.

8. RESERVES

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

9. NUMBER OF MEETINGS OF BOARD

During the year the Nine (9) Board Meetings were held on the following
dates:

Sl No.	Board Meeting no.	Date of Board meeting
1.	411	23.04.2024
2.	412	22.05.2024
3.	413	13.06.2024
4.	414	09.08.2024
5.	415	15.10.2024
6.	416	08.11.2024
7.	417	18.12.2024
8.	418	29.01.2025
9.	419	12.02.2025

The details of the meetings attended by each Directors are given in the
Corporate Governance Report provided as Annexure I to this Report.

10. EXTRACT OF 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, 2025 is available in the website of the company at www.
hoclindia.com/annual-return

11. SUBSIDIARY COMPANY

Your company has one (1) subsidiary company namely; Hindustan
Fluorocarbons Limited [HFL]. Ministry of Chemicals and Fertilizers,
Department of Chemicals & Petrochemicals vide No. P. 51015/06/2019-
Ch. III (Vol.II) dated 29^th January, 2020 informed the decision of Cabinet
Committee on Economic Affairs, directing closure of HFL, which was
approved by the shareholders on 30^th March, 2020. Pursuant to Section
129(3) of the Companies Act, 2013 read with Rule 5 of the Companies
(Accounts) Rules, 2014, a statement containing salient features of the
financial statements of subsidiary company in Form AOC-1 is attached
as Annexure II to the Board''s Report.

12. RELATED PARTY TRANSACTIONS

All the Related Party Transactions that were entered into during the
financial year were on arm''s length basis and were in ordinary course of
business. There were no materially significant transactions with Related
Parties during the financial year 2024-2025 which were in conflict with
the interest of the Company. Suitable disclosures as required under IND
AS-24 have been made in Note No.36 of the Notes to the Standalone
Financial Statements.

Particulars of contract/arrangements/transactions made with related
parties, pursuant to Section 188(1) of the Companies

Act, 2013 in the prescribed form AOC-2 is appended as
Annexure III which forms part of this report.

13. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The details in this regard forms part as Annexure IV to the Board''s
Report.

14. CORPORATE GOVERNANCE AS PER SEBI REGULATIONS

Due to non-availability of One Women Director for the whole financial
year 2024-25 and requisite Independent Directors from 23.12.2024,
there has been non-compliance to that extent with various requirements
of Corporate Governance under the provisions of Companies Act,
2013 and SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 and various Rules/ Regulations made there under.
The details in this regard forms part of Corporate Governance report to
the Annual Report. The requisite certificate from the practicing company
secretaries confirming with the conditions of Corporate Governance is
attached to the report on Corporate Governance.

15. COMPLIANCE OF CORPORATE GOVERNANCE GUIDELINES
ISSUED BY DEPARTMENT OF PUBLIC ENTERPRISES

Department of Public Enterprises [DPE], Government of India, has laid
down certain parameters for the purpose of grading the CPSEs on the
basis of their compliance with guidelines on Corporate Governance
and this report needs to be submitted to the Ministry of Chemicals &
Fertilizers, Government of India on Quarterly basis. Company has been
complying with the Guidelines on Corporate Governance for CPSEs
laid down by DPE and regularly submits reports to the Ministry of
Chemicals & fertilizers, Government of India. Applicable grade of 4^th
Quarter/year ended 31.03.2024 is “Excellent”. The requisite certificate
from the practicing company secretaries confirming with the conditions
of DPE Corporate Governance guidelines is attached to the report on
Corporate Governance.

16. BOARD EVALUATION:

The provisions of Section 134 (3)(p) of Companies Act, 2013 are
exempted for Government Companies as the performance evaluation
of the Directors are carried out by the Ministry, which is administratively
in charge of the Company as per its own evaluation methodology.

17. KEY MANAGERIAL PERSONNEL:

The following are Key Managerial Personnel of the Company during the
year under review:

a) Shri Sajeev B - Chairman & Managing Director [DIN: 09344438]

b) Shri Yogendra Prasad Shukla - CFO & Director (Finance) [DIN:
09674122]

c) Shri Subramonian H - Company Secretary & Compliance Officer
[ACS: 28380]

18. DETAILS OF DIRECTORS OR KMP’S WHO WERE APPOINTED,
CEASED OR HAVE RESIGNED DURING THE YEAR:

a) Dr Bharat J Kanabar and Shri Pratyush Mandal, have ceased as
Independent Directors of the company due to completion of their
tenure on 23.12.2024.

b) Shri Kanish Kant Srivastava has ceased as Government Nominee
Director w.e.f 30.03.2025.

c) Shri Subodh Kumar was appointed as Non-Official Independent
Director for a period of three years w.e.f 21.05.2025.

d) Shri Sajeev B has ceased as Chairman & Managing Director due
to superannuation on 31.05.2025.

e) Shri Vinay Kumar Sharma was appointed as Non-Official
Independent Director for a period of one year w.e.f 05.06.2025.

f) Ms Vandana was appointed as Government Nominee Director for
a period of three years w.e.f 10.06.2025.

19. PARTICULARS OF EMPLOYEES

Information regarding particulars of employees drawing remuneration
in excess of the limit specified under Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014 is not
applicable as none of the employees of the Company has drawn
remuneration in excess of the stipulated limit, during the year
under review.

20. COMPOSITION OF AUDIT COMMITTEE AND NON-ACCEPTANCE
OF ANY RECOMMENDATIONS OF AUDIT COMMITTEE.

During the FY 2024-25, all the recommendations of the Audit Committee
were accepted by Board of Directors. Details of Composition, meetings
of Audit Committee/Sub-Committee are provided in Corporate
Governance Report which forms part of this Report.

21. COMMITTEES OF THE BOARD

The Company''s Board has the following Committees:

i. Audit Committee

ii. Nomination and Remuneration Committee

iii. Stakeholder Relationship Committee

iv. Corporate Social Responsibility Committee (CSR)

22. SECRETARIAL STANDARDS

The Company complies with the applicable Secretarial Standards
issued by the Institute of Company Secretaries of India [ICSI].

23. DIRECTOR’S RESPONSIBILITY STATEMENT

The financial statements are prepared in accordance with the Indian
Accounting Standards (IND AS), the provisions of Companies Act,
2013 and guidelines issued by SEBI. The IND AS are prescribed under
Section 133 of Companies Act, 2013 read with Rule 3 of the Companies
(Indian Accounting Standards) Rules, 2015 and relevant amendments,
rules issued thereafter. Your Directors make the following statement in
terms of Section 134(5) of the Companies Act, 2013 -

(a) That in the preparation of the annual accounts for the year ended
31^st March, 2025; the applicable accounting standards had
been followed along with proper explanation relating to material
departures.

(b) That such accounting policies as mentioned in the Notes on
Accounts had been applied 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 the
financial year ended 31^st March, 2025 and the profit or loss of the
Company for that period.

(c) That proper and sufficient care had been taken 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) That the annual accounts for the year ended 31^st March, 2025 had
been prepared on a going concern basis.

(e) Directors have laid down internal financial controls to be followed
by the company and such internal financial controls are adequate
and are operating effectively and

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

24. INDEPENDENT DIRECTORS DECLARATION

The Company has received necessary declaration from each of the
Independent Directors that he meets the criteria of independence laid
down under section 149 (6) of the Companies Act, 2013 and listing
regulations.

25. DISCLOSURE ON REAPPOINTMENT OF INDEPENDENT
DIRECTORS

No reappointment of Independent Directors was made during the year
under review.

26. COMPANY’S POLICY ON DIRECTOR’S APPOINTMENT AND
REMUNERATION INCLUDING CRITERIA FOR DETERMINING
QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF
DIRECTORS ETC.

As per notification dated 5^th June, 2015 issued by Ministry of Corporate
Affairs, provision of section 134(3) (e) of the Companies Act, 2013
regarding disclosure of its policy on Director''s appointment and
remuneration including criteria for determining qualifications, positive
attributes, independence of a Director and other matter provided under
sub- section (3) of section 178 of the Companies Act, 2013 are not
applicable to a Government company.

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. The Terms and Conditions of appointment of
Independent Directors and other directors, are as per the Government
Orders are disclosed on the Company''s website.

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

The provisions of Section 134 (3)(e) of the Act are not applicable to
a Government Company. Consequently, details on Company''s policy
on Directors'' appointment and other matters are not provided under
Section 178 (3) of the Act. Similarly, Section 197 of the Act is also
exempt for a Government Company. Consequently, disclosure of the
ratio of the remuneration of each Director to the median employee''s
remuneration and other such details including the statement showing
the names and other particulars of every employee of the Company,
who if employed throughout/ part of the financial year, was in receipt
of remuneration in excess of the limits set out in the Rules are not
provided in terms of Section 197 (12) of the Act read with Rule 5 (1) /
(2) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014. The Chairman & Managing Director and the
Whole-time Director of the Company did not receive any remuneration
or commission from any of its Subsidiaries. HOCL, being a Government
Company, its Directors are appointed/nominated by the Government
of India as per the Government/DPE Guidelines which also include
fixation of pay criteria for determining qualifications and other matters.

28. AUDITORS

a) Statutory Auditors

M/s. Balan & Co, Chartered Accountants, Kochi was appointed as
Statutory Auditors of your Company for FY 2024-2025 by C&AG.

The auditors have furnished a declaration confirming their
independence as well as their arm''s length relationship with the
Company as well as declaring that they have not taken up any
prohibited non-audit assignments for the Company. The Audit
Committee reviews the independence and objectivity of the
Auditors and the effectiveness of the audit process. The auditors
attend the Annual General Meeting of the Company. The Auditors
in their report for the year have not reported any instances of fraud
committed by the officers/employees of the company.

b) Cost Auditors

The Board of Directors had appointed M/s. B.B.S Associates as
Cost Auditors of your Company for FY 2024-25. In the 63^rd AGM
held on 25^th September, 2024 the members have ratified the
remuneration payable to the Cost Auditors. Company has made &
maintained Cost Records as specified by the Central Government
under Section 148 of the Companies Act, 2013.

c) Internal Auditors

M/s. Suneel Maggo and Associates, A-60, 2^nd Floor S-9, Sector-2,
NOIDA, U P, 201301 were appointed by the Board of Directors
as Internal Auditor of your Company for Kochi unit and Mumbai
office for FY 2024-25. They have submitted quarterly reports for
FY 2024-25. The are no pending major observations from Internal
Auditors.

d) CAG Auditors

Supplementary Audit of financial statements (Standalone
& Consolidated) is conducted by Principal Director of Audit
(Shipping), Mumbai. The Comptroller & Auditor General of India
(CAG) has conducted the supplementary audit of the financial
statements of HOCL for the year ended 31.03.2025 and issued
‘Nil'' comment statements for both standalone & consolidated
financials. The report of CAG under Section 143(6)(b) of the
Companies Act, 2013 forms part of the annual report.

e) Secretarial Auditors

The Board of Directors had appointed M/s. J K Das & Associates.,
Practising Company Secretaries to conduct Secretarial Audit for
the FY 2024-25. The Secretarial Audit Report in accordance with
Section 204 of Companies Act, 2013 for the Financial Year ended
31^st March, 2025 is annexed to this Report. The observations in
the Secretarial Audit report and the management response thereof
are given below:

Observation	Management Response
The Company shall have at least one women director for the financial year 2024-25 as required under section 149(1) of Companies Act, 2013.	HOCL is a CPSE under the administrative control of the Ministry of Chemicals & Fertilizers, Dept. of Chemicals and Petro Chemicals (DCPC), Government of India. Hence, as per Company''s Articles of Association (AOA), the powers to appoint the Board of Directors of HOCL company vest with the GOI/Administrative Ministry. During the financial year 2024-25, there was vacancy of one Women Director in HOCL. Company has frequently requested DCPC to appoint a woman director. Consequent to this, vide order dated 10.06.2025 Ms Vanadana was appointed a Government Nominee Director in HOCL Board.
Composition of the Board and Committees of the Board viz. Audit Committee and Nomination and Remuneration Committee were not in terms of Section 149(4) of the Companies (Appointment and Qualification of Directors) Rules, 2014 and Section 177(2) of the Companies Act, 2013, due to non-appointment of requisite number Independent Director on the Board.	HOCL is a CPSE under the administrative control of the Ministry of Chemicals & Fertilizers, Dept. of Chemicals and Petro Chemicals (DCPC), Government of India. Hence, as per Company''s Articles of Association (AOA), the powers to appoint the Board of Directors of HOCL company vest with the GOI/Administrative Ministry. Due to non-availability of requisite Independent Directors on Board, w.e.f 23.12.2024, composition of all Board committees were not proper. However, subsequent to the appointment of Independent Directors, w.e.f 19.06.2025 all the committees were properly re¬ constituted.

Meeting of independent director not hold during the financial year under review.

Company has held one meeting in the calendar year 2024.

There is no equal opportunity policy for Disabled Persons as required under Disability Law. According to Section 21 of The Rights of Person with Disabilities Act, 2016 along with The Rights of Persons with Disables Rules, 2017 (together the “Disability Law”), Every establishment shall notify equal opportunity policy detailing measures proposed to be taken by it in pursuance of the provisions of this Law. This policy must be published for PwDs preferably on the establishment''s website or at conspicuous places in their premises.

In accordance with the provisions of the Rights of Persons with Disables Rules, 2017 Company had already notified in its premises the relevant details including the facility available to the persons with disabilities.

29. Details of vigilance cases for the Financial Year 2024-25

Opening balance	Vigilance cases received	Disposed	Balance
as on 01.04.2024	during 01.04.2024 to	off
	31.03.2025
NIL	2	1	1

30. STATUS OF PENDING CAG PARAS AND MANAGEMENT
REPLIES: Nil

31. SAFETY, HEALTH AND ENVIRONMENT

HOCL is certified for IMS (Integrated Management System) which is
comprising of Quality Management System (ISO-9001), Environment
Management System (ISO-14001) and Occupational Health and
Safety Management System (ISO 45001). Company is also certified for
Energy Management System (ISO-50001).

1. SAFETY

The company has achieved 1232239 safe man hours for the year
2024 with no lost time accidents. Since last reportable incident
our organisation has achieved 5 million safe man hours worked
without any lost time accident reported. The Company has
implemented several new measures to improve the safety culture
in addition to the normal systems and procedures.

• During the April 2024 shutdown, the majority of pipelines,
critical valves, equipment spares and structures were
replaced to ensure both process efficiency and employee
safety. The sulfuric acid unloading hose was adjusted to
prevent spillage following tanker unloading

• Motor stopping delay relays were integrated for numerous
pumps to prevent tripping during power dips, resulting in
production savings. This improvement also enhances safety
by minimizing operator exposure to chemicals during start up
and shutdown operations.

• Four LPG online leak detection sensors was installed around
LPG spheres and bullets and these were integrated into
the Remote Sensing Enabled Online Chemical Emergency
Response System (ROCERS), monitored by F&B, Kerala to
handle emergency situation and guiding public.

The company has its own online work permit system integrating 6
separate work permits viz, Hot work, Cold work, Confined space
entry, Work at height, Excavation and Radiography. HOCL has
developed benchmark in Accident /incident investigation through
a 29-point accident investigation checklist. The company has
implemented Near Miss reporting system whereby employees
can report any unsafe acts/conditions and corrective actions shall
accordingly to prevent accidents. The best HSE suggestions
received in the year has been implemented after evaluations
through which employees could get the health benefits and
additional health check-ups could be introduced and gained
considerable safety improvements. The best suggestions received
in the year has been implemented after evaluations.

Refresher training sessions on Fire and safety were imparted to
the employees. Additional safety training for truck drivers were
given for creating a safety culture in driving.

Various competitions were organized for creating more awareness
on safety among employees, observed National Safety day,
National fire service week, Road safety week, Electrical Safety
Week etc.

An online HSE compliance system has been established.
Corrective action is taken by the top management after review
and analysis.

In order to promote young minds on safety Plant visits/Internships
were permitted to students pursuing the B.Tech/Diploma/M.Sc .
In addition, visits permitted to participants of Supervisory training
course as per Sec 41C(b) of Factories Act 1948.

M/s. Kaju Thakur (C/o. Mr.Jose- Civil Contractor) working in
HOCL bagged “Best Safety Guest Worker” from the Department
of Factories and Boilers, Government of Kerala; Category I (Very
Large Factories); Sub Category VI . Since the inception of the
Best Safety Guest Worker Awards, it was for the First time HOCL
was the recipient of this award.

HOCL won Abhinandan Pathra from M/s. National Safety
Council- Kerala Chapter on achieving commendation in Medium
Industries (Chemicals) during the year 2024. Our employees have
participated in the State level competitions conducted by M/s.
National Safety Council, Kerala Chapter held in connection with
National Safety day and won prizes.

In 2024, the company successfully conducted one of the largest
Annual Shutdown activities, during which a comprehensive
range of maintenance tasks were scheduled. Over 687 contract
employees were engaged to perform various critical tasks during
this period. To ensure the safety of all workers, awareness
sessions were conducted focusing on the hazards associated with
the chemicals used within the plant and the required Personal
Protective Equipment (PPE). Additionally, Toolbox Talks were held
by the HOCL supervisor before the commencement of each task,
emphasizing the importance of safety and the proper use of PPEs
specific to the jobs being carried out.

To further ensure safety standards were upheld, surprise
inspections were conducted by the Fire and Safety Department.
Throughout this extensive shutdown, more than 5075 permits
were issued for various jobs, reflecting the scale and complexity of
the operations. Remarkably, despite the high number of contract
workers and the large-scale activities, there were no reportable
accidents or incidents during this period, showcasing the effective
safety measures and proactive management of the shutdown
process.

Introduced Compressed Air Foam System (CAFS) an advanced
fire suppression system that combines water, foam concentrate,

and compressed air to create a highly effective firefighting foam.
The foam is deployed to smother fires, offering superior coverage
compared to water alone. CAFS has the advantage of using less
water. Its non-conductive foam makes it safe for use on electrical
fires.

Considering the nature of the chemicals and their storage, mock
drills are conducted periodically to raise employee awareness.

2. HEALTH

In the areas of Health, Hygiene and Environment, the company
has undertaken periodic medical examination as well as statutory
requirements of fitness check-up were carried out during the year
2024 for our employees. Audiometry tests were carried out for
those who are exposed with higher noise levels and Benzene
handlers. Auto toxicity tests were carried out for the Benzene
handlers apart from other statutory regular check-ups. Urine
Phenol Test was added for Benzene Handlers.

¦ Free Dental checkup, eye checkup, Blood Tests, Body Mass
Index Measurement, Ideal Body Weight Evaluation etc were
conducted for employees.

¦ Periodic Awareness Sessions for the benefit of employees
on Fatty Liver, Kidney etc. were conducted.

¦ PSA test were conducted for all male employees above 40
years of age. Also PAP Smear, Transvaginal USG, USG
Breast, Mammogram, USG Abdomen - were conducted for
female staff.

¦ For canteen employees - BC, LFT, RFT, FLP, URE, FBS,
Uric Acid, HbAIC, Stool RE etc. were conducted.

¦ Physical examination including Pulse, BP, Blood Sugar, ECG
were conducted for Housekeeping staff.

¦ Organized 120 days Health Challenge (Weight loss) for the
employees having higher BMI.

¦ In order to motivate employees about the importance
of health, Cycle Rally, Walkathon, Mass run etc. were
organized.

¦ Vitamin D levels were checked and supplementations were
given to employees.

¦ Awareness session on TB was conducted as part of National
TB Elimination programme, High risk employees were
identified and they were screened for TB, HIV, Malaria.

¦ Occupational Health Centre was renovated.

3. ENVIRONMENT

In alignment with our commitment to environmental protection and
sustainability, HOCL has undertaken a series of proactive initiatives
to minimize its ecological footprint and promote environmental
awareness. We are proud to report that the level of pollutants
emitted from our factory and the surrounding areas remains well
below the permissible limits prescribed by regulatory authorities.
As part of our environmental stewardship, we have conducted
various awareness sessions, competitions, and cleanliness drives
under the Swachh Bharat initiative. Plant premises have been
beautified with the active participation of all employees, reinforcing
a sense of ownership and responsibility toward the environment.

Our commitment extended beyond the plant as we organized
cleanliness activities in nearby schools and public roads. These
efforts aim to instil environmental values in the community and
enhance the surroundings.

World Environment Day 2024 was commemorated through
the planting of saplings and organizing a range of competitions
centered around the theme “Land Restoration, Desertification
and Drought Resilience." The event saw enthusiastic participation
from employees across all departments.

Demonstrating our commitment to plastic waste management,
HOCL has registered under the Extended Producer Responsibility
(EPR) scheme with the Central Pollution Control Board (CPCB)
as a brand owner, ensuring accountability in recycling and
responsible disposal.

To ensure regulatory compliance, we have implemented a 24x7
online Effluent Monitoring and Stack Monitoring System, in
adherence to CPCB and Kerala State Pollution Control Board
guidelines. Regular safety inspections and “Safety Walks” by the
Safety Committee, coupled with daily patrols by the Fire & Safety
crew, serve as key mechanisms for continual environmental and
safety improvements. Additionally, compliance with internal and
external audits under the ISO 14001 (Environmental Management
System) as part of our Integrated Management System (IMS)
reflects our rigorous adherence to environmental standards.

Feedback from near-miss reports and HSE suggestions are
systematically addressed, underscoring HOCL''s unwavering
commitment to environmental protection and continual
improvement.

32. RESERVATION AND OTHER WELFARE MEASURES FOR
SCHEDULED CASTES/SCHEDULED TRIBES/ OTHER BACKWARD
CLASSES AND PERSONS WITH BENCHMARK DISABILITIES.

All guidelines laid down in respect of Reservation and other welfare
measures for Scheduled castes/Scheduled Tribes/Other Backward
Classes are complied with. The provisions for special arrangement for
Persons with Disabilities at work place have been complied with.

Representation of SC, ST, OBC, PwBD and Women in employment
position as on 31 03 2025

Category	Total	SC	ST	OBC	PwBD	WOMEN
A	94	10	6	21	2	12
B	26	4	2	6		-
C	52	10	1	10	1	2
D	10	1	-			-
Total	182	25	9	37	3	14

33. IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY.

During the year under report, the company continued its efforts to
promote Hindi as Official Language in its day to day official activities.
Our Executive Director & UIC attended Regional Joint Conference
on Official Language conducted by Dept of Official Language (OL)
at Mysore on 04^th January 2025 and received the First prize for best
performance in OL from Hon. Minster of State for Home Affairs and
Hon. Governor of Bihar.

Our officers attended fourth All India Rajbhasha conference organized
by Dept of OL, Ministry of Home Affairs at Bharat Mandapam, New
Delhi, on 14 & 15 September 2024. Hindi Fortnight organized
from 14^thto 29^th September 2024 in Our Unit. During Hindi Fortnight
celebrations, various competitions were organized and large number
of employees participated. Competitions were also conducted for the
students of GGHSS, Thripunitura and for children''s of employees
during this celebrations.

HOCL bagged Regional OL Award - First Prize in PSU category in
Region “C” for best performance in OL implementation from Dept of
OL, Ministry of Home Affairs for the year 2023-24. HOCL also bagged
First prize for the best implementation of OL policy from Town official
language Implementation Committee (TOLIC) for the year 2023-24 and
consolation prize for its e-magazine “Pehachan”.

For popularising Official Language Hindi, an outreach programme
named Rajbhasha Chetna Karykram was continued this year also for
BA/MA Hindi students of various Colleges and Universities of Calicut
and Palakkad districts of Kerala during the month of August and
September 2024. Seminar on OL were organised in five colleges during
this programme. Around 500 students participated in this OL awareness
programme/Seminar. In addition, a full day OL Orientation Programme
was also conducted for the MA students of Regional Centre of SSUS,
,Tirur on 06.02.2025.

An Official language Management programme was organised
exclusively for HOD''s of the company on 13.06.2024. Besides a
Technical Workshop was conducted exclusively for the Members of
Official language implementation Committee (OLIC) of the company
on 26.03.2025. Our officers and employees attended various OL
seminars organized by Powergrid Corporation, Directorate of Coco and
Cashew, FACT, HPCL, Cochin Shipyard at Kochi in association with
TOLIC(PSU), Kochi.

The inauguration of Joint Hindi Fortnight celebrations 2024 of
TOLIC (PSU), Kochi was organised in our company on 05.02.2025.
Shri. Yogendra Prasad Shukla, Director (Finance) inaugurated the
programme. Mr. M J Jagadeesh, Executive Director & UIC presided
over the function. Three competitions viz. Calligraphy, Translation,
Noting and Drafting and Technical Terminology competitions were
conducted in our office on 05.02.2025. Our office has actively
participated in various programmes conducted by TOLIC (PSU), Kochi
during the period under report.

To make awareness about the importance of Hindi among students,
World Hindi Day was celebrated on 10^th January 2025 at Sri Sankara
College, Kalady, Ernakulam along with classes on Rajbhasha Hindi
and organised Quiz competition during the programme. An interactive
session on OL and Career was also conducted at Dept of Hindi,
MA College, Kothamangalam, Ernakulam on 09.01.2025. On the
occasion of International Mother Language Day on 21 February 2025,
competitions were conducted for employees.

Two issues of e-magazine “Pehachan” published and uploaded in the
website of Rajbhasha Vibhag by the company during the period under
report. All documents under section 3(3) of OL Act 1963 were issued
both in Hindi and English. The Website of the company is available both
in Hindi and English.

Practical computer training was imparted to the officers and employees
of the company on 21.09.2024 and from 11^th to 13^th March 2025.
Incentive Scheme for doing original work in Hindi was already
implemented in our Unit. 15 employees participated in this programme
and received their cash incentives. Various promotional schemes
including for better implementation of Official Language have been
adopted by our organization. Our officer attended five days Translation
refresher course conducted by CTB, New Delhi. To familiarize the
Hindi words and its equivalent English words are being circulated daily
among all ministerial employees in the name of Aaj Ka Shabd.

4 meetings of OLIC were conducted during the year and Our ED &UIC
attended the two TOLIC Meetings held at Ernakulam. OL inspection
by the DCPC, Ministry of Chemical & Fertilizer was carried out and OL
inspections of all Sections/Depts at Kochi unit were conducted during
the year. In connection with various Day celebrations organised in our
Unit, competitions were also organised in Hindi to promote the use of
Hindi.

34. CITIZEN’S CHARTER, PUBLIC GRIEVANCE REDRESSAL (PG),
CUSTOMER CARE SYSTEM (CCS) & RIGHT TO INFORMATION
(RTI)

In line with the provisions of RTI Act 2005 to promote transparency and
accountability, our organisation has taken efforts to handle the Right to
Information sought for. Company has laid down procedure to provide

information through Public Information Officer/CPIO and Appellate
Authority.

The number of RTI applications received and disposed off during the
year 2024-25 is given below:

Total number of RTI applications received during the	42
year 2024-25
Applications rejected during the year 2024-25, if any	0
Information submitted during the year 2024-25	43*
Pending to reply as on 31.03.2025	0

* Reply to RTI application pending during previous year submitted
during this year.

35. MICRO, SMALL & MEDIUM ENTERPRISES (MSME)

In line with the Government''s directive to procure items from MSMEs,
the company has implemented necessary procedures in all tenders to
ensure MSMEs'' eligibility for participation. We have removed restrictive
clauses and modified tender conditions to facilitate greater involvement
of MSMEs, particularly SC/ST MSMEs, in the procurement process.
Our purchase policy complies with these directives. HOCL regularly
updates procurement data on the MSME Sambandh and Samadhan
portals and is registered on the TREDs platform. Additionally, we
actively participatedin the vendor development program conducted
by the MSME Development & Facilitation Office in Thrissur, Kerala,
aimed at enhancing procurement through the GeM portal and MSMEs.
However, 95% of HOCL''s purchases by value are petroleum products
(such as LPG, Benzene, Furnace Oil, and Hydrogen), supplied by M/S
BPCL via pipeline transfer, which are not manufactured by MSMEs
and are not available on the GeM portal. To further support MSMEs,
we have launched a campaign promoting the ZED (Zero Defect Zero
Effect) and Lean certifications, which are designed to improve product
quality competitiveness, and provide access to government benefits.
We have sent detailed information to over 80 MSME vendors and
emphasized the benefits of these certifications during site visits. To
encourage adoption, we have included information regarding ZED and
Lean certifications in our tender documents and will provide information
on our website and social media platforms. We are also committed to
offer continuous support to vendors throughout the certification process

36. SOCIAL, ENVIRONMENTAL AND ECONOMIC RESPONSIBILITIES
AND BUSINESS RESPONSIBILITY REPORT

SEBI (Listing Obligations and Disclosure Requirement) Regulations,
2015 with regard to disclosure of Business Responsibility Report is not
applicable to your company. However, Hindustan Organic Chemicals
Limited has adopted and realizes the benefits of Management Principles
into daily activities to achieve the goals of the organization. These
Management Principles will provide a foundation to continually improve
upon the Organization''s performance. The organization believes the
following principles to align with the business processes.

1. Customer focus

2. Leadership

3. Utilization of resources with improved information flow within the
organization

4. Process approach; &its Continual improvement,

5. Risk & opportunity and real time decisions

6. Developing internal resources & maintaining better human
relations at work.

We have adopted the “Process Approach” into daily operations
including the PDCA Cycle. We have considered the utilization of
Risk-Based Thinking when developing, implementing, and improving

the effectiveness in most of our Management System. This approach
enables Hindustan Organic Chemicals Limited to enhance the
overall performance of the Organization by effectively controlling the
interrelationships and the interdependencies among the processes.

The understanding and consistency with achieving customer specific
requirements;

• The consideration of our processes in terms of added value;

• The achievement of effective process performance;

• Improvement of our processes based on real time data and
information.

We also effectively plan and implement various actions to address risks
and opportunities to maximize the outcomes including, but not limited
to achieving improved results and preventing negative effects of our
products, Operations, services.

Our businesses provide goods and services that are safe and contribute
to sustainability throughout their life cycle and to promote the wellbeing
of all employees, respect the interests of the stake holders, responsive
towards all stake holders, especially those who are disadvantaged,
vulnerable and marginalized. Our businesses respect, protect, and
make efforts to restore the environment in a safe and better manner
by complying with the relevant Statutory regulations. Our businesses
also support and provide value to their customers and consumers in a
responsible manner.

37. DETAILS OF CSR ACTIVITIES DURING THE YEAR

Company since its inception is very much aware about its social
responsibility. For over five decades, as a socially responsible and
sensitive corporate, your Company continues to remain committed to
social thought and action to serve society through providing basic civic
amenities to the neighbouring villages, rendering assistance in different
forms.

HOCL has incurred continues losses during the financial years 2021-22,
2022-23, 2023-24. Accordingly, provisions of CSR were not applicable
to HOCL during the FY 2023-24 & 2024-25. About financial year 2024¬
25 there was profit after tax primarily due to waiver of Government of
India dues. As is typical with such waivers, the impact is reflected in
the Profit and Loss Account for FY 2024-25 as a one-time exceptional
item, resulting in a reported profit for the year. However, during financial
year 2024-25 there was no actual operational profit. Accordingly, HOCL
is not required to carry out any CSR activities during the year under
review. However, Company has recognized its social obligations and
done the following activities:

i. HOCL has provided a Sanitary Napkin Incinerator to Government
Vocational Higher Secondary School, Ambalamugal for helping
the students to manage waste efficiently and also to serve as an
educational tool to teach about the responsible waste disposal
and environmental conservation.

ii. HOCL has provided 15 Nos. of Rain coats to nearby Police
Station.

iii. HOCL has provided two Personal Computers to Kuzhikkad
Government High School on the occasion of beginning of the new
academic year 2024-25 and one Personal Computer to Kakkad
Grameena Vayanasala to assist the digitalization of the resources
of the Vayanasala.

Other activities during the year under review.

¦ Based on the theme “Viksit Bharat Ka Mantra, Bharat ho Nashe

se Swatantra” on 12^th August and all the employees on duty took
the pledge from their respective work places and have participated
in the e-pledge also.

¦ Under the aegis of “Har Ghar Tiranga” to further honour our
National Flag and invoke the feeling of patriotism in the hearts
of the citizen and promote awareness about the National Flag,
distributed the Indian National Flag to our employees and other
stakeholders and requested to hoist the same at their houses
during the Independence week.

¦ Celebrated the 78^th Independence Day with various programmes.
HOCL has organized a mass run on Independence Day with the
Slogan “SAY NO TO DRUGS”.

¦ Constitution Day was observed in our organization to
commemorate the adoption of the ‘Constitution of India''.
‘Preamble'' of the Constitution was read out by our Chairman and
Managing Director and all employees were joined in the reading of
the Preamble.

¦ World Environment Day 2024 celebrations at HOCL were formally
inaugurated by CMD, saplings were planted at various places
inside our premises on the occasion and conducted various
competitions like plant a sapling and take a selfie contest, slogan
writing and painting contest etc.

¦ International Yoga Day was celebrated with an awareness session
followed by a practical Yoga session for employees and family on
the eve of Yoga Day at HOCL Community Hall.

¦ Yoga training session was arranged for HOCL employees and
the students of Govt. High School, Ambalamedu on 21.06.2024
at our Training Centre and wide publicity was given through
banners, social media etc. T-Shirts with Logo were distributed to
participants.

¦ International Women''s Day 2025 was celebrated by WIPS
(Forum of Women In Public Sector), HOCL with various cultural
programmes

¦ Vigilance Awareness Week was observed with Integrity Pledge,
interactive session on Ethics and Governance, CDA Rules &
Vigilance Matters etc. and conducted various competitions like,
Essay writing, Elocution competition on “Culture of Integrity for
Nation''s Prosperity”, Quiz etc.

¦ The birth Anniversary of Sardar Vallabhbai Patel, the architect of
the national integration of independent India is observed as “The
Rashtriya Ekta Diwas” started with a pledge to foster and reinforce
our dedication to preserve and strengthen the unity, integrity and
security of the nation.

¦ Conducted an awareness session on POSH Act for our newly
recruited personnel by Dr.Raseena Padmam, Retd. Professor &
former Director of School of Behavioural Science, M G University,
Kottayam.

¦ Swachhata Diwas celebrations: HOCL has celebrated swachhta
Diwas in a befitting manner on the auspicious day of the birth
anniversary of our father of the Nation. Mr. H Kam Suanthang,
Joint secretary of DCPC was the chief guest for the swachhata
Diwas celebrations at HOCL.

¦ HOCL celebrated the Swachhta Pakhwada from 01.09.2024 to
15.09.2024 by administration of Swachhata Pledge. Conducted
various competitions, cleanliness drives, webinars, awareness
classes etc. on the same. As part of Swachhata Ki Bhagidari we
were conducted various competitions visz., Painting, Essay and
Quiz for the school Children of Govt. High School, Ambalamedu,
Ernakulam.

38. INDUSTRIAL RELATIONS:

Your company continued to maintain the overall Industrial Relation

situation to be peaceful and cordial during the year 2024-25. There

was no strike or lockout during the year. All employees continued to

contribute their best to the company during the year.

39. MANPOWER STATUS:

The manpower strength of the Company as on 31^st March, 2025 was
182 consisting of 120 Officers and 62 non-officer''s category.

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

There are no loans, guarantees, or investments made by the company
under Section 186 of the Companies Act 2013 during the year under
review and hence said provisions are not applicable.

41. EXPLANATION OR COMMENTS ON QUALIFICATIONS,
RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS
MADE BY THE STATUTORY AUDITORS

There are no qualifications, reservations of adverse remarks made by
the statutory auditors in their report.

42. MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING
THE FINANCIAL POSITION OF THE COMPANY OCCURRED
BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS
FINANCIAL STATEMENTS RELATE AND THE DATE OF THE
REPORT

Nil

43. THE DETAILS IN RESPECT OF ADEQUACY OF INTERNAL
FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL
STATEMENTS:

Company ensures existence of adequate internal controls through
documented policy and procedures laid down in the manuals to be
followed by the executives at various levels. Internal controls are
supported by periodical internal audits and management reviews. The
management is keen on these issues and initiated various measures
such as upgrading the IT infrastructure, evaluating and implementing
ERP software, web-based application and establishing connectivity
amongst manufacturing units, Corporate office and branch offices for
effective and proactive services and businesses.

Audit Committee/Board periodically reviews the internal controls, audit
programme, financial results and recommendations, the replies of the
management to Government Audit and internal audit etc.

The Company has maintained adequate financial control system,
commensurate with the size, scale and complexity of its operations
and ensures compliance with various policies, practices and statutes
in keeping with the organization''s pace of growth and increasing
complexity of operations.

44. CONSERVATION ENERGY, TECHNOLOGY ABSORPTION,
FOREIGN EXCHANGE EARNINGS AND OUTGO

A. The steps taken and impact on conservation of energy:

Major Energy Conservation Activities / Projects Implemented in
2024-25

• Replacement of conventional lights with LED lights: Electrical
energy saving Rs.6.57 lakhs/year

• Replacement of Old AC with New 5star rating ACs: Electrical
energy saving Rs.0.63 lakhs/year

• Replacement of conventional fan with Energy Efficient BLDC
fans: Electrical energy saving Rs.0.66 lakhs/year

• Replacement of conventional motor with energy efficient IE3
motor: Electrical energy savings Rs.1.35 lakhs/year

B. Technology Absorption

The specific consumption of raw materials and chemicals has
been reduced by optimising their usage through an in-house
technology.

i. The efforts made towards technology absorption: Nil

ii. The benefits derived like product improvement, cost
reduction, product development or import substitution:

• MOC of the DNET section pipe lines changed from CS
to PTFE in order to avoid the plant down time due to
leakage resulting from corrosion.

• A Proposal put forwarded for the recovery of ACP from
TAR

• New Air compressor purchase is in progress with a
payback period of 1.7 years. And an expected savings
of RS -18765780 /- per year as compared to the existing
compressor

iii. In case of imported technology (imported during the last
three years reckoned from the beginning of the financial
year): Nil

(a) the details of technology imported; NA

(b) the year of import; NA

(c) whether the technology been fully absorbed; NA

(d) if not fully absorbed, areas where absorption has not
taken place, and the reasons thereof; and

iv. the expenditure incurred on Research and Development: Nil

C. FOREIGN EXCHANGE EARNINGS AND OUTGO: NIL

45. STATEMENT CONCERNING DEVELOPMENT AND
IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE
COMPANY

Key Threats include:

• Competition from domestic / imports and fluctuation in the input
prices

• High input costs

• High utility costs

• High overheads

• Limited availability of anti-dumping support for the main products
Phenol and Acetone.

• High interest cost.

Some risks and concerns:

• High manpower cost per ton of finished product.

• Depreciated plants, requiring high maintenance cost.

• Dumping in main products Phenol / Acetone.

• Volatility in main input Benzene.

• Restriction in taking up new ventures

46. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
WHICH HAVE BECOME OR CEASED TO BE.

Ministry of Chemicals and Fertilizers, Department of Chemicals &
Petrochemicals vide No. P. 51015/06/2019-Ch. III dated 29-01-2020
informed the decision of Cabinet Committee on Economic Affairs,
directing closure of Hindustan Fluorocarbons Limited (HFL), subsidiary
company of HOCL, which was approved by the shareholders on
30.03.2020.

Consequent to the decision of the Govt. of India for closure of Subsidiary
Company Hindustan Fluorocarbons Ltd., an amount of Rs.75.87 crore
has been released as loan from Govt. of India to meet the expenses
related to VRS/VSS to employees and settling dues to Bank and other
liabilities. HFL is under the process of Delisting and closure.

47. DEPOSITS:

During the period under review, the Company has not invited or
accepted any deposits from the directors, shareholders and public.

48. THE DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED
BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING
THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS
IN FUTURE:

Nil

49. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT
WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL)
ACT, 2013

As per the requirement of The Sexual Harassment of Women at
Workplace (Prevention, Prohibition & Redressal) Act, 2013 (‘Act'')
and rules made there under, the Company has adopted a Sexual
Harassment Policy for women to ensure healthy working environment
without fear of prejudice, gender bias and sexual harassment. The
policy has been widely disseminated. A Complaint Committee is in
existence as per the Act. The Board states that there were no cases
or complaints filed pursuant to the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013.

In connection with observance of Sexual Harassment of Women at
workplace Prevention week 2023, various programmes were conducted
viz., Pledge, a Street Play on POSH Act was carried out by our women
employees, Women''s Walkathon Competition, an Awareness session
on POSH Act etc.

Annual Report for the year 2023 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

50. VIGILANCE MECHANISM:

Hindustan Organic Chemicals Limited, being a Government Company,
a Vigilance Department is already existing in pursuance of CVC
Guidelines headed by Chief Vigilance Officer (CVO), HOCL. The
Vigilance Mechanism is being handled by the Vigilance Department and
the Company has already adopted a Vigilance Manual in pursuance of
CVC Guidelines. Vigilance Manual is available on Company''s Website.

51. INTEGRITY PACT

Adoption of Integrity Pact already implemented in HOCL through two
(2) no(s) of Independent External Monitor(s)to maintain, foster most
ethical and corruption free business environment.

The Integrity Pact Policy adopted by the Company is applicable in
respect of all tenders with estimated value above Rs.50 lakhs (excluding
export). Your Company has also conducted structured meetings of the
Independent External Monitor with Chairman & Managing Director and
other Executives. Integrity Pact is being updated as per CVC circulars.
Integrity Pact Policy is available on the web site of the Company.

52. WHISTLE BLOWER POLICY

As per the Regulation 22 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and as per section 177(9) of the
Companies Act, 2013, every listed companies shall formulate a vigil
mechanism/ Whistle Blower Policy for directors and employees to
report genuine concerns. Your Company has adopted a Whistle Blower
Policy to provide appropriate avenues to all permanent employees to
make protected disclosure as per the whistle blower policy. The Policy
provides for adequate Safeguards against victimization of employees
who avail the mechanism and also provides for direct access to the
Chairman of the Audit Committee. It is affirmed that no personnel of
the Company have been denied access to the Chairman of the Audit
Committee and that no complaints were received during the year in
this regard. The Whistle Blower Policy is placed in the website of the
company.

53. GENERAL

No disclosure or reporting is required in respect of the following matters
as there were no transactions on these matters during the year under
review:

• Issue of equity shares with differential rights as to dividend, voting
or otherwise.

• Issue of shares (including sweat equity shares) to employees of
the Company under any scheme.

• The Company does not have any scheme of provision of money
for the purchase of its own shares by employees or by trustees for
the benefit of employees.

• Neither the Managing Director nor the Whole-time Directors of the
Company receive any remuneration or commission from any of its
subsidiaries.

• No significant or material orders were passed by the Regulators
or Courts or Tribunals which impact the going concern status and
Company''s operations in future.

• No fraud has been reported by the Auditors to the Audit Committee
or the Board.

• There is no Corporate Insolvency Resolution Process initiated
under the Insolvency and Bankruptcy Code, 2016.

54. AWARDS & RECOGNITION

• HOCL received Abhinandan Patra among medium industries from
M/s.National Safety Council, Kerala Chapter. This prestigious
award recognizes our organization''s outstanding commitment to
workplace safety and health, setting exemplary standards within
the industry. The dedication to implementing best practices and
proactive risk management strategies has not only ensured the
well-being of our employees but has also contributed significantly
to fostering a culture of safety across the sector.

• HOCL has received the Best Guest Safety Worker Award among
Category I from the Department of Factories and Boilers, Govt of
Kerala during the year 2024.

• HOCL received Regional Rajbhasha Puraskar for the year 2023¬
24, the First prize for the best implementation of the Official
Language Policy,

• HOCL bagged the First prize from the Town Official Language
Implementation Committee (PSU), Kochi for best implementation
of Official Language policy in the company for the year 2023-24.

• HOCL bagged Consolation prize for its house Journal ‘Pehchaan''
under the ‘Best Home Magazine Award'' for the year 2023-24 from
the Town Official Language Implementation Committee (PSU),
Kochi.

55. ACKNOWLEDGEMENT

The Board of Directors are extremely thankful to all officials of
Department of Chemicals & Petro-chemicals, Ministry of Chemicals
& Fertilizers, Government of India for the continued support extended
to HOCL. The Directors thank the Company''s employees, customers,
vendors, investors and other stake holders for their continuous support.
The Directors also express their grateful appreciation for the support
and co-operation from officials of Governments of Maharashtra,
Government of Kerala, and other Government departments and
agencies, Banks, financial institutions, local bodies and all Auditors of
the company. The Board places on record its gratitude to the members
of the Company for their support and confidence in the management.
The Directors appreciate and value the contribution made by each
member of the Hindustan Organic Chemicals Limited family.

For and on behalf of the Board of Directors of Hindustan Organic

Chemicals Limited

Sd/-

Yogendra Prasad Shukla
Chairman and Managing Director
DIN:09674122

Date: 13.08.2025

Place: Ernakulam, Kerala

---

Mar 31, 2024

The Board of Directors presents herewith the 63^rd Annual Report of your Company along with the Audited Statement of Accounts for the financial year 2023-24.

1. FINANCIAL RESULTS

The financial results for the year ended 31.03.2024 with the comparative figures of company''s operations for the previous year is as under:

(Rs in lakhs)

Particulars	2023-24	2022-23
Revenue from operations	70,389.00	63,143.56
Other Income	1,669.10	1,154.60
Total	72,058.10	64,298.16
Expenditure	77,589.80	69,320.57
Profit/ (loss) before exceptional item & Tax	(5,531.70)	(5,022.41)
Less: Exceptional items	-	-
Profit /(Loss) before Tax	(5,531.70)	(5,022.41)
Less: Tax expenses	-	-
Profit/(Loss) after Tax	(5,531.70)	(5,022.41)
Other Comprehensive Income for the year, net of tax	5,919.70	782.78
Total Comprehensive Income for the year	388.00	(4,239.63)

2. MEMORANDUM OF UNDERSTANDING WITH GOVERNMENT OF INDIA

Company has been exempted from submitting Memorandum of Understanding (MOU) with the Ministry of Chemicals & Fertilizers, Government of India, for the year 2023-24.

3. CONSOLIDATED FINANCIAL STATEMENT

In accordance with the provisions of the Companies Act, 2013 (“the Act”) and IND AS 110 - Consolidated Financial Statement, the audited consolidated financial statement for the period ending 31.03.2024 is provided in the Annual Report.

4. DIVIDEND

In view of the loss incurred during the current year, the Board of Directors do not recommend any Dividend for the year under review.

5. CHANGE IN NATURE OF BUSINESS IF ANY

There was no change in the nature of business of the Company during the FY 2023-24.

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.370 crores and the paid-up equity capital of the company is Rs.67.27 crores and preference share capital is Rs.270 crores respectively. The company''s shares are listed in BSE (Scrip ID: 500449). 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. FINANCIAL HIGHLIGHTS

During the year 2023-24, the company has achieved a Gross Income of Rs.720.58 crore registering an increase of 12.07% as against the Previous Year Gross Income of Rs.642.98 Crore.

8. RESERVES

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

9. NUMBER OF MEETINGS OF BOARD & COMMITTEES

During the year the six (6) Board Meetings were held on the following dates:

Sl No.	Board Meeting no.	Date of Board meeting
1.	405	18.05.2023
2.	406	01.06.2023
3.	407	08.08.2023
4.	408	09.11.2023
5.	409	15.12.2023
6.	410	09.02.2024

During the year the Committee Meetings were held on the following dates:

Audit Committee meeting

Sl No.	Audit Committee Meeting no.	Date of Board meeting
1.	91	18.05.2023
2.	92	08.08.2023
3.	93	09.11.2023
4.	94	09.02.2024

Stakeholders Relationship Committee Meeting

9^th Stakeholders Relationship Committee meeting held on 9^th November, 2023

Nomination & Remuneration Committee meeting

7^th Nomination & Remuneration Committee meeting held on 09^th February, 2024

The details of the meetings attended by each Directors are given in the Corporate Governance Report provided as Annexure I to this Report.

10. EXTRACT OF 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, 2024 is available in the website of the company at www. hoclindia.com/annual-return

11. SUBSIDIARY COMPANY

Your company has one (1) subsidiary company namely; Hindustan Fluorocarbons Limited [HFL]. Ministry of Chemicals and Fertilizers, Department of Chemicals & Petrochemicals vide No. P. 51015/06/2019-Ch. III (Vol.II) dated 29^th January, 2020 informed the decision of Cabinet Committee on Economic Affairs, directing closure of HFL, which was approved by the shareholders on 30^th March, 2020. Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of subsidiary company in Form AOC-1 is attached as Annexure II to the Board''s Report.

12. RELATED PARTY TRANSACTIONS

All the Related Party Transactions that were entered into during the financial year were on arm''s length basis and were in ordinary course of business. There were no materially significant transactions with Related Parties during the financial year 2023-2024 which were in conflict with the interest of the Company. Suitable disclosures as required under IND AS-24 have been made in Note No.36 of the Notes to the Standalone Financial Statements.

Particulars of contract/arrangements/transactions made with related parties, pursuant to Section 188(1) of the Companies Act, 2013 in the prescribed form AOC-2 is appended as Annexure III which forms part of this report.

13. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The details in this regard forms part as Annexure IV to the Board''s Report.

14. CORPORATE GOVERNANCE AS PER SEBI REGULATIONS

Due to non-availability of One (1) Independent Women Director for the FY 2023-24, there has been non-compliance to that extent with various requirements of Corporate Governance under the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and various Rules/ Regulations made there under. The details in this regard forms part of Corporate Governance report to the Annual Report. The requisite certificate from the practicing company secretaries confirming with the conditions of Corporate Governance is attached to the report on Corporate Governance.

15. COMPLIANCE OF CORPORATE GOVERNANCE GUIDELINES ISSUED BY DEPARTMENT OF PUBLIC ENTERPRISES

Department of Public Enterprises [DPE], Government of India, has laid down certain parameters for the purpose of grading the CPSEs on the basis of their compliance with guidelines on Corporate Governance and this report needs to be submitted to DPE through online mode on Quarterly basis. Company has been complying with the Guidelines on Corporate Governance for CPSEs laid down by DPE and regularly submits reports to the Ministry of Chemicals & fertilizers, Government of India. Applicable grade of 4^th Quarter/year ended 31.03.2024 is “Excellent”. The requisite certificate from the practicing company secretaries confirming with the conditions of DPE Corporate Governance guidelines is attached to the report on Corporate Governance.

16. BOARD EVALUATION:

The provisions of Section 134 (3)(p) of Companies Act, 2013 are exempted for Government Companies as the performance evaluation of the Directors are carried out by the Ministry, which is administratively in charge of the Company as per its own evaluation methodology.

17. KEY MANAGERIAL PERSONNEL:

The following are Key Managerial Personnel of the Company:

a) Shri Sajeev B - Chairman & Managing Director [DIN: 09344438]

b) Shri Yogendra Prasad Shukla - CFO & Director (Finance) [DIN: 09674122]

c) Shri Subramonian H - Company Secretary & Compliance Officer [ACS: 28380]

18. DETAILS OF DIRECTORS OR KMP’S WHO WERE APPOINTED OR HAVE RESIGNED DURING THE YEAR:

Ministry of Chemicals & Fertilizers, Department of Chemicals & Petrochemicals vide OM.No.P-51015/12/2014-CHEM.IM-CPC dated 22-11-2023, appointed Shri Manoj Sethi, Joint Secretary and Financial Advisor, Ministry of Chemicals & Fertilizers as Government Nominee Director of HOCL in place of Shri Sanjay Rastogi.

19. PARTICULARS OF EMPLOYEES

The provisions of Section 134(3)(e) of the Companies Act, 2013 are not applicable to a Government Company. Accordingly, details on Company''s policy on Directors'' appointment and other matters as required under Section 178 (3) of the Act, are not provided.

20. COMPOSITION OF AUDIT COMMITTEE AND NON-ACCEPTANCE OF ANY RECOMMENDATIONS OF AUDIT COMMITTEE.

During the FY 2023-24, all the recommendations of the Audit Committee were accepted by Board of Directors. As on 31^st March, 2024 Audit Committee has 3 members in compliance with Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Details of Composition, meetings of Audit Committee/Sub-Committee are provided in Corporate Governance Report which forms part of this Report.

21. COMMITTEES OF THE BOARD

The Company''s Board has the following Committees:

i. Audit Committee

ii. Nomination and Remuneration Committee

iii. Stakeholder Relationship Committee

iv. Corporate Social Responsibility Committee (CSR)

22. SECRETARIAL STANDARDS

The Company complies with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India [ICSI].

23. DIRECTOR’S RESPONSIBILITY STATEMENT

The financial statements are prepared in accordance with the Indian Accounting Standards (IND AS), the provisions of Companies Act, 2013 and guidelines issued by SEBI. The IND AS are prescribed under Section 133 of Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendments, rules issued thereafter. Your Directors make the following statement in terms of Section 134(5) of the Companies Act, 2013 -

(a) That in the preparation of the annual accounts for the year ended 31^st March, 2024; the applicable accounting standards had been followed along with proper explanation relating to material departures.

(b) That such accounting policies as mentioned in the Notes on Accounts had been applied 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 the financial year ended 31^st March, 2024 and the profit or loss of the Company for that period.

(c) That proper and sufficient care had been taken 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) That the annual accounts for the year ended 31^st March, 2024 had been prepared on a going concern basis.

(e) Directors have laid down internal financial controls to be followed by the company and such internal financial controls are adequate and are operating effectively and

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

24. INDEPENDENT DIRECTORS DECLARATION

The Company has received necessary declaration from each of the Independent Directors that he meets the criteria of independence laid down under section 149 (6) of the Companies Act, 2013 and listing regulations.

25. DISCLOSURE ON REAPPOINTMENT OF INDEPENDENT DIRECTORS

No reappointment of Independent Directors was made during the year under review.

26. COMPANY’S POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF DIRECTORS ETC.

As per notification dated 5^th June, 2015 issued by Ministry of Corporate Affairs, provision of section 134(3) (e) of the Companies Act, 2013 regarding disclosure of its policy on Director''s appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matter provided under sub- section (3) of section 178 of the Companies Act, 2013 are not applicable to a Government company.

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. The Terms and Conditions of appointment of Independent Directors and other directors, are as per the Government Orders are disclosed on the Company''s website.

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

The provisions of Section 134 (3)(e) of the Act are not applicable to a Government Company. Consequently, details on Company''s policy on Directors'' appointment and other matters are not provided under Section 178 (3) of the Act. Similarly, Section 197 of the Act is also exempt for a Government Company. Consequently, disclosure of the ratio of the remuneration of each Director to the median employee''s remuneration and other such details including the statement showing the names and other particulars of every employee of the Company, who if employed throughout/ part of the financial year, was in receipt of remuneration in excess of the limits set out in the Rules are not provided in terms of Section 197 (12) of the Act read with Rule 5 (1) / (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Chairman & Managing Director and the Whole-time Director of the Company did not receive any remuneration or commission from any of its Subsidiaries. HOCL, being a Government Company, its Directors are appointed/nominated by the Government of India as per the Government/DPE Guidelines which also include fixation of pay criteria for determining qualifications and other matters.

28. AUDITORS

a) Statutory Auditors

M/s. Paulson & Co, Chartered Accountants, was appointed as Statutory Auditors of your Company for FY 2023-2024 by C&AG.

The auditors have furnished a declaration confirming their independence as well as their arm''s length relationship with the Company as well as declaring that they have not taken up any prohibited non-audit assignments for the Company. The Audit Committee reviews the independence and objectivity of the Auditors and the effectiveness of the audit process. The auditors attend the Annual General Meeting of the Company. The Auditors in their report for the year have not reported any instances of fraud committed by the officers/employees of the company.

b) Cost Auditors

The Board of Directors had appointed R.M Bansal & Co., Cost Accountants, Kanpur having branch office at TC 49/620(2) SafnamMrwa 61-A, Malliyidom, Thiruvanathapuram, Kerala as Cost Auditors of your Company for FY 2023-2024. In the 62^nd AGM held on 26^th September, 2023 the members have ratified the remuneration payable to the Cost Auditors. Company has made & maintained Cost Records as specified by the Central Government under Section 148 of the Companies Act, 2013.

c) Internal Auditors

M/s. Isaac & Suresh, Chartered Accountants, Ernakulam, Kerala were re-appointed by the Board of Directors as Internal Auditor of your Company for Kochi unit and Mumbai office for FY 2023-2024. They have submitted quarterly reports for FY 2023-24. There are no major observations from Internal Auditors.

d) CAG Auditors

Supplementary Audit of financial statements (Standalone; Consolidated) is conducted by Principal Director of Audit (Shipping), Mumbai. The Comptroller; Auditor General of India (CAG) has decided not to conduct the supplementary audit of the financial statements of HOCL for the year ended 31.03.2024. The report of CAG dated 29.07.2024 under Section 143(6)(b) of the Companies Act, 2013 forms part of the annual report.

e) Secretarial Auditors

The Board of Directors had appointed M/s. J K Das & Associates., Practising Company Secretaries to conduct Secretarial Audit for the FY 2023-2024. The Secretarial Audit Report in accordance with Section 204 of Companies Act, 2013 for the Financial Year ended 31^st March, 2023 is annexed to this Report. The observations in the Secretarial Audit report and the management response thereof are given below:

Observation

Management Response

The Board of Directors of the Company was not duly constituted as the Company does not have requisite number of Independent Directors on its Board. It was observed that during the period under review from 01 st April, 2023 to 31st March, 2024 Company has a vacancy of one (1) Independent Woman Director on its Board.

HOCL is a CPSE (Central PSU/PSE) under the administrative control of the Ministry of Chemicals & Fertilizers (MoC&F), Dept. of Chemicals and Petro Chemicals (DCPC), Government of India. Hence, the MoC&F is the administrative ministry and as per Company''s Articles of Association (AOA), the powers to appoint the Board of Directors of HOCL company vest with the GOI/Administrative Ministry. Presently, there is vacancy of one (1) Independent Women Director in HOCL. In order to fill the vacancy, Company vide letter dated 16th June, 2022 and 13th September, 2022 and e-mail dated 10th January, 2023 and again on 15th June, 2023, 13th November, 2023, 19th February, 2024 and 31st May, 2024 requested the Administrative Ministry to appoint one (1) Women Independent Director on HOCL Board. Company is awaiting necessary orders from the ministry in this regard.

29. Details of vigilance cases for the Financial Year 2023-24

Opening balance	Vigilance cases received	Disposed	Balance
as on 01.04.2023	during 01.04.2023 to	off
	31.03.2024
NIL	0	0	NIL

30. STATUS OF PENDING CAG PARAS AND MANAGEMENT REPLIES: Nil

31. SAFETY, HEALTH AND ENVIRONMENT

HOCL is certified for IMS (Integrated Management System) which is comprising of Quality Management System (ISO-9001), Environment Management System (ISO-14001) and Occupational Health and Safety Management System (ISO 45001). Company is also certified for Energy Management System (ISO-50001). HOCL is continuing the “Eat Right Campus” certification with five-star rating by FSSAI for its industrial canteen.

1. SAFETY

We are privileged to inform that HOCL bagged Kerala Industrial Safety Awards 2023 for outstanding performance in Industrial Safety and Occupational Health; Category II (Large Factories employing 251 -500 workers); Sub Category I (Chemicals, Petroleum, Petrochemicals, General Engineering/ Automobile Repairing) by Factories and Boilers Department, Government of Kerala. Kerala Industrial Safety Awards 2023 for Best Safety Committee (Individual Awards) by Factories and Boilers Department, Government of Kerala. Kerala Industrial Safety Awards 2023 for Best Safety Worker (Sri. Suresh Kumar- QC dept) by Factories and Boilers Department, Government of Kerala. Since the inception, it was for the First time HOCL received the awards for the Best Safety Committee and Best Safety Worker Awards. Our employees have participated in the State level competitions conducted by M/s. National Safety Council, Kerala Chapter held in connection with National Safety day and won prizes. HOCL also bagged Abhinandan Pathra from M/s. National Safety Council- Kerala Chapter on achieving

commendation in Medium Industries (Chemicals) during the year 2023. The company has achieved 866232 safe man hours for the year 2023 with no lost time accidents in the organization. The Company has implemented several new measures to improve the safety culture in addition to the normal safety systems and procedures. Ensured the Representation of contract workers in Safety committee. Contract workers are encouraged to report near miss incidents also.

Conducted awareness class regarding hazards associated with the chemicals used inside the plant and respective PPEs to be used. Tool box talk is ensured by the HOCL supervisor before starting any work emphasizing the importance of safety and usage of PPEs for carrying out specific jobs. Surprise inspections are done by Fire and Safety Department to ensure the safety of contract workers. During patrolling Fire and Safety Department ensures the work is being carried out with valid work permit. Safety walk is also carried out by the Safety Committee members in this aspect. Specific training is imparted to the workers during shut down prior to commencement of the work. The workers are allowed to enter the plant premises by the security only after wearing required PPEs and after a briefing given on general safety and security aspects. Awareness class given to Canteen staff on LPG and LNG safety.

Participation in the competition held in connection with safety including Road Safety Week, Fire week and Electrical Safety Week. Conducted awareness class to the truck drivers including participation in the Road Safety Week awareness/competition. As part of observance of World Eye Sight Day (12^th Oct 2023) class on the importance of eye safety along with selection of appropriate eye wear was conducted for the employees. An online HSE compliance system has been established. Corrective action is taken by the top management after review and analysis.

To nurture young minds awareness session on handling e-waste to students of the nearby school carried out. A session on Lab safety was also handled by our Officers to the 11^th & 12^th class students and relevant PPES while doing the analysis of chemicals at Chemistry lab also provided to students.

Additional measures during 2023:

1. Established a Standard Operating Procedure for Scaffolding:

Scaffolding implementation involved establishing a proper framework which involved preparation of Scaffolding Manual, Erection and Procedure and checklist prepared for maintaining safety in works related with scaffolding.

2. Safety Innovation:

Modifications have been made in High Mast light towers for safety of person during hoisting and lowering of the light panel bracket based on a real time accident occurred in the Airport.

3. Job Safety Analysis (JSA):

Job Safety Analysis is a proactive approach to safety management that helps organizations prevent workplace injuries and illnesses by systematically identifying and addressing potential hazards before they cause harm. It promotes a safer work environment and enhances overall safety awareness among workers. JSA was carried out for major works.

4. FABSAFE:

Company has enabled a real time vehicle locating tracking system for monitoring and surveillance of transport of Hazardous chemicals across the sate in association with the Department of Factories and Boilers, GoK.

5. ROCERS (Remote Sensing Enabled Online Chemical Emergency Response System):

Our Company has been part of ROCERS, a joint project by the Department of Factories & BOILERS, GoK, NRSC (National remote sensing Centre) and Indira Gandhi Centre for Atomic Research, Kalpakkam. This is in place to warn nearby residents about an impending Industrial accident. LPG Sensors installed would enable an early detection and early warning system to

the Dept of Factories & Boilers, the reporting is instantaneous.

The system helps the District Administration, Police and State Disaster Management Centre to get all information of a chemical emergency in the hazardous installations.

a) HSE suggestion scheme

The new initiative which aims to encourage the employees to put forward their creative and potential ideas that could lead to considerable improvements in Safety, Reduction in wastages, Health of employees, protecting the flora and fauna or the natural resources through operational controls and Best practices. Also, to acquire inputs on HSE where otherwise we wouldn''t receive. The best suggestions received in the year has been implemented after evaluations through which employees could get the health benefits and additional health check-ups could be introduced and gained considerable safety improvements.

b) Behavioural Based Safety (BBS)

Psychology is the study of human behaviour, and individual behaviour is a recognised impediment to upholding high standards of health and safety. Many people know what they are doing is incorrect, but they still choose to do it anyway. Other people make mistakes unintentionally, and those people can be instructed in behavioural safety. In order to prevent and control human behaviour and prevent accidents, behaviour-based safety program has gained importance.

The company has its own Online work permit system integrating 6 separate work permits viz, Hot work, Cold work, Confined space entry, Work at height, Excavation and Radiography. HOCL has developed benchmark in Accident /incident investigation through a 29-point accident investigation checklist. The company has implemented Near Miss reporting system whereby employees can report any unsafe acts/conditions and corrective actions shall be taken after a review to prevent accidents.

Refresher training sessions on Fire and safety were imparted to the employees. Additional safety training for truck drivers were given for creating a safety culture in driving.

Fire Safety awareness and practical training imparted to nearby school students to inculcate a safety culture in the young minds.

Various competitions were organized for creating more awareness on safety among employees, observed National Safety day, National fire service week, Road safety week, Electrical safety week etc in association with concerned Statutory Authorities .

In order to promote young minds on safety Plant visits/ Internships were permitted to students pursuing the B.Tech/ Diploma/M.Sc . In addition, visits permitted to participants of Supervisory training course as per Sec 41C(b) of Factories Act 1948.

2. HEALTH

In the areas of Health, Hygiene and Environment, the company has undertaken periodic medical examination, as well as statutory requirements of fitness check-up were carried out during the year 2023 for our employees. Audiometry tests were carried out for those who are exposed with Noise and Autotoxicity tests were carried out for the Benzene handlers apart from other statutory regular check-ups.

¦ Free eye checkup camp organized for employees.

¦ Periodic awareness session for the benefit of employees on Ayurveda and healthy diet, diabetics, Liver, Heart etc.

¦ In connection with the cancer awareness week observance, a cancer awareness session was conducted for the employees.by renowned Oncologist. PSA- test introduced for all male employees above 40 years of age. Also introduced, PAP Smear, Transvaginal USG - for female staff above 40 years of age.

¦ USG Breast, Mammogram, USG Abdomen- for all female staff.

¦ For canteen employees- CBC, LFT, RFT, FLP, URE, FBS, Uric acid, HbAIC, Stool RE. These additional tests are outcome of HSE suggestions received and awarded during the previous year.

¦ Organised a 120-day health challenge (weight loss, belly lose) for the employees having higher BMI.

¦ In order to motivate employees about the importance of health, Cycle rally, Walkathon, Mass run etc. were organized for the employees, provided assistance to the women employees in a Midnight Run organized at Kochi jointly by a media house and a leading bank.

¦ Financial assistance given to the clubs for organizing a Swimming class for the wards of employees during the mid-summer vacation.

¦ A running club was started in HOCL with participation of 50 numbers of employees. As part of it, in order to promote the employees for a healthy living lifestyle for both physically and mentally, financial assistance given to the clubs for purchasing two bicycles for providing to the employees residing at HOCL Township.

¦ Introduction of new instruments at Quality Control Laboratory minimised exposure to chemicals by the laboratory personnel.

3. ENVIRONMENT

In our commitment to Environment, we have ensured that the level of pollutants from the Factory and nearby surroundings was much below the permissible levels. As part of protecting the environment, awareness sessions, competitions, Swachh Bharat activities, promoting employees for vegetable cultivation under a “Green Mission”, Beautification of the plant premises involving the entire employees of the organization were carried out. As part of cleanliness drive, Swachhta activities carried out at nearby schools, Hill Palace Heritage museum etc.

World Environmental day 2023 was observed by planting of saplings in addition organising various competitions related to theme “Beat Plastic Pollution” with wide participation of employees.

On-line Effluent Monitoring and stack monitoring system is implemented to comply with the Central Pollution Control Board /Kerala State Pollution Control Board regulations. Periodic inspections and safety walk were carried out by the Safety Committee members in addition to the daily patrolling of Fire crew as a continual improvement. Daily monitoring of the Laboratory analysis by the concerned ensures compliances with the stipulated parameters/norms. Compliances to observations and corrective actions as per the internal /surveillance audits of ISO 14001(Environment Management System) audits as part of IMS, compliances to Near miss and HSE suggestion points related to Environment ensures HOCL taking due care for Protecting the nature.

32. RESERVATION AND OTHER WELFARE MEASURES FOR SCHEDULED CASTES/SCHEDULED TRIBES/ OTHER BACKWARD CLASSES AND PERSONS WITH BENCHMARK DISABILITIES.

All guidelines laid down in respect of Reservation and other welfare measures for Scheduled castes/Scheduled Tribes/Other Backward Classes are complied with. The provisions for special arrangement for Persons with Disabilities at work place have been complied with.

Representation of SC, ST, OBC, PwBD and Women in employment position as on 31.03.2024

Category	Total	SC	ST	OBC	PwBD	WOMEN
A	93	11	6	12	2	10
B	27	5	2	8	-	-
C	58	11	2	30	1	4
D	10	1	-	1	-	-
Total	188	28	10	51	3	14

33. IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY.

During the year under report, the company continued its efforts to promote Hindi as Official Language in its day to day official activities. 08 Hindi workshops were conducted during the year including a special session on Annual Programme 2023-24 on Official language for HOD’s and Senior Officers of Corporate office, Kochi. Hindi week and Hindi Fortnight were organized from 14 to 29^th September 2023. Our officers attended Third All India Rajbhasha Seminar organized by Dept of OL, Ministry of Home Affairs at Pune, Maharashtra on 14 & 15 September 2023. During Hindi Fortnight celebrations, various competitions were organized and large number of employees participated. HOCL bagged Regional OL Award - Second Prize in PSU category in Region “C” for best performance in OL implementation from Dept of OL, Ministry of Home Affairs for the year 2022-23. HOCL bagged third prize for best implementation of OL Policy from Hon’ Minister of Chemicals and Fertilizers for the year 2022-23. HOCL Kochi Unit also bagged First prize for the best implementation of OL policy from Town official language Implementation Committee (TOLIC) for the year 2023-24 and third prize for e-magazine “Pahachan”. Our office has actively participated in various programmes conducted by TOLIC (PSU), Kochi. One Day OL seminar for exclusively Hindi Staff of TOLIC’s (Central Govt and PSU) of Kochi was conducted on 18 August 2023 in our office premises. Two days technical workshops for employees and students of Universities were conducted on 14 & 15 December 2023. Our officers have attended various OL seminars organized by FACT, HPCL, IOCL, BPCL, Kochi TOLIC (PSU) and Kochi TOLIC (Bank). Our Executive Director & UIC attended Regional Joint Conference on Official Language conducted by Dept of OL at Bengaluru on 19 January 2024 and received the Award from Hon Minster of State for Home Affairs. Translation and Noting and Drafting and Technical Terminology competitions were conducted in our office during Joint Hindi celebration 2023 of Kochi TOLIC (PSU). To make awareness among students the importance of Hindi, celebrated World Hindi Day on 10^th January 2024 at our training centre for Students of St Peters College, Kolencherry and Sree Sankara Vidyapeetom College, Airapuram, Ernakulam. Competitions and awareness sessions were conducted during the full day programme. On the occasion of International Mother Language Day on 21 February 2024, competitions were conducted for employees. Two issues of e-magazine “Pahchan” were published by the company during the period under report. All documents under section 3(3) of OL Act 1963 were issued both in Hindi and English. The Website of the company is available both in Hindi and English. Practical computer training was imparted to the officers and employees of the company on 28.09.2023 and 26.03.2024. Our company sponsored a World Environment Day celebration by Green literary Centre, CUSAT organised at Dept of Hindi, CUSAT. An interactive session on OL and Career was conducted at GVHSS, Thripunitura and Dept of Hindi, CUSAT, Kochi on 20.10.2023 and 21.12.2024 respectively. Incentive Scheme for doing original work in Hindi was already implemented in our Unit. Various promotional schemes including for better implementation of Official Language have been adopted by our organization. For popularising Official Language Hindi, an outreach programme named Rajbhasha Chetna Karykram was organised for BA/MA Hindi students of various Colleges and Universities of Kannur and Kasargod districts of Kerala during the month of February and March 2024. Awareness sessions on OL were organised during the 6 days programme. 350 students participated in this OL awareness programme.

34. CITIZEN’S CHARTER, PUBLIC GRIEVANCE REDRESSAL (PG), CUSTOMER CARE SYSTEM (CCS) & RIGHT TO INFORMATION (RTI)

In line with the provisions of RTI Act 2005 to promote transparency and accountability, our organisation has taken efforts to handle the Right to Information sought for. Company has laid down procedure to provide information through Public Information Officer/CPIO and Appellate Authority.

The number of RTI applications received and disposed off during the year 2023-24 is given below:

Total number of RTI applications received during the	46
year 2023-24
Applications rejected during the year 2023-24, if any	0
Information submitted during the year 2023-24	45
Pending to reply as on 31.03.2024	1*

• Reply to RTI application has been submitted in the subsequent quarter.

35. MICRO, SMALL & MEDIUM ENTERPRISES (MSME)

Company is taking all efforts to comply with the Government Directive to procure items specified for procurement from MSMEs. Necessary procedures have been made in all tenders re-stating the eligibility of MSMEs so as to participate in tenders. We have removed the restricted clauses in the tender conditions and modified the same which will help in greater participation of MSMEs and especially SC/ST MSMEs in the procurement processes. Company has modified the purchase policy also to comply with the directions.

HOCL always takes efforts to fulfill the requirements. HOCL diligently updates its procurement data on the MSME Sambandh Portal monthly. HOCL has actively participated in the vendor development programme conducted by MSME-Development & Facilitation Office, Thrissur, Kerala to enhance the procurement thru GeM portal & from MSMEs. HOCL''s 95% of the purchases by value are petroleum products (LPG, Benzene, Furnace Oil, Hydrogen which are our raw materials.) supplied by M/S. BPCL through pipeline transfer. These items are not manufactured by MSMEs and not available in GeM portal.

36. SOCIAL, ENVIRONMENTAL AND ECONOMIC RESPONSIBILITIES AND BUSINESS RESPONSIBILITY REPORT

SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015 with regard to disclosure of Business Responsibility Report is not applicable to your company. However, Hindustan Organic Chemicals Limited has adopted and realizes the benefits of Management Principles into daily activities to achieve the goals of the organization. These Management Principles will provide a foundation to continually improve upon the Organization''s performance. The organization believes the following principles to align with the business processes.

1. Customer focus

2. Leadership

3. Utilization of resources with improved information flow within the organization

4. Process approach; &its Continual improvement,

5. Risk & opportunity and real time decisions

6. Developing internal resources & maintaining better human relations at work.

We have adopted the “Process Approach” into daily operations including the PDCA Cycle. We have considered the utilization of Risk-Based Thinking when developing, implementing, and improving the effectiveness in most of our Management System. This approach enables Hindustan Organic Chemicals Limited to enhance the overall performance of the Organization by effectively controlling the interrelationships and the interdependencies among the processes.

The understanding and consistency with achieving customer specific requirements;

• The consideration of our processes in terms of added value;

• The achievement of effective process performance;

• Improvement of our processes based on real time data and information.

We also effectively plan and implement various actions to address risks and opportunities to maximize the outcomes including, but not limited to achieving improved results and preventing negative effects of our products, Operations, services.

Our businesses provide goods and services that are safe and contribute to sustainability throughout their life cycle and to promote the wellbeing of all employees, respect the interests of the stake holders, responsive towards all stake holders, especially those who are disadvantaged, vulnerable and marginalized. Our businesses respect, protect, and make efforts to restore the environment in a safe and better manner by complying with the relevant Statutory regulations. Our businesses also support and provide value to their customers and consumers in a responsible manner.

37. DETAILS OF CSR ACTIVITIES DURING THE YEAR

Company since its inception is very much aware about its social responsibility. For over five decades, as a socially responsible and sensitive corporate, your Company continues to remain committed to social thought and action to serve society through providing basic civic amenities to the neighbouring villages, rendering assistance in different forms.

As the average of three immediately preceding financial year is net loss, your Company is not required to carry out any CSR activities during the year under review. However, Company has recognized its social obligations and extended the following during the year 2023-24.

• Continued drinking water supply to nearby local residents.

• The Haritha Karma Sena members of Vadavukode Grama Panchayat were honoured by HOCL for their relentless and dedicated service to the society.

Other activities.

SWACHH BHARAT ABHIYAN

• Celebrated the Swachhta Pakhwada from 01.09.2023 to 15.09.2023 and conducted various competitions, cleanliness drives, webinars, awareness classes etc.

• Conducted a cleanliness campaign at a nearby Government School (GVHSS, Ambalamugal) by our employees, apprentices and trainees and Organized an awareness session for students on Scientific Management of E-waste and pin badge were supplied for the students with “e-waste awareness motto” and donated Stainless Steel Lunch plates for the students.

• Celebrated the Swachhta Hi Seva 2023 from 15.09.2023 and conducted various cleaning activities viz., waste collection drives in households/HOCL Township to give vide publicity of the theme “Garbage Free India”

• A Mass Cleaning Campaign was conducted on Swachhta Diwas at Hill Palace Museum, a famous tourist spot, Tripunithura led by our CMD and with the participation of ex-servicemen, employees, apprentices, trainees etc.

• HOCL is declared as “Plastic Free Zone” by eliminating single use plastic items. Eliminated the plastic packets of milk in canteen by converting to large volume cans.

• Swachhta activities were conducted by different departments from 01.09.2023 onwards. Segregation and weeding out of old records, enlisting and keeping the same is still going on.

• Awareness session conducted by the Company Medical Officer on Better Hygiene to the House keeping staff, Security personnel etc.

• Various Competitions (in English/ Hindi/ Malayalam) were organized for the employees, apprentices/trainees & High School and College going students.

• Swachhta cleaning activities done at Township with participation of wards, residents, employees and contract workers.

AZADI KA AMRIT MAHOTSAV

As part of Azadi Ka Amrit Mahotsav conducted various cleaning activities in our premises, Stickers prepared on Azadi Ka Amrit Mahotsav and pasted in all official correspondences. Celebrations are organized with various activities till August 2023.

World Environment Day

Celebrated the World Environment day with various programmes like Marathon - “Run for Nature” by HOCL Fraternity including family members from HOCL Township to HOCL Factory premises.

INTERNATIONAL YOGA DAY

Yoga Day was celebrated on 21^st June 2023, Common Yoga protocols were widely circulated for the information of all employees through our portal and social media. International Yoga Day was celebrated with a talk on the importance of Yoga in our daily life followed by a practical session conducted by a Yoga Acharya for our employees.

38. INDUSTRIAL RELATIONS:

Your company continued to maintain the overall Industrial Relation situation to be peaceful and cordial during the year 2023-24. There was no strike or lockout during the year. All employees continued to contribute their best to the company during the year.

39. MANPOWER STATUS:

The manpower strength of the Company as on 31^st March, 2024 was 188 consisting of 120 Officers and 68 non-officer''s category.

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

There are no loans, guarantees, or investments made by the company under Section 186 of the Companies Act 2013 during the year under review and hence said provisions are not applicable.

41. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE STATUTORY AUDITORS

The management response for the qualification made by the Statutory Auditors in their audit report for the Financial Year 2023-24 is given below:

Qualification	Management Response
We draw attention to note no. 11	The outstanding loan advanced
of the accompanying Standalone	by HOCL to HFL (subsidiary
Financial Statements regarding	company) amounts to Rs.
the waiver of interest chargeable	3197.08 lakhs as at 31.03.2024.
on loans amounting to Rs.	The loans were advanced to
453.01 lakhs advanced to its	HFL between the FY 2004-05
subsidiary. As per the provisions	to 2009-10 in tranches. The
of Section 186(7) of the	outstanding loan consists of
Companies Act, 2013, no loan	Rs.2744.07 lakhs as interest
shall be given at a rate of interest	free loan and Rs.453.01 lakhs as
lower than the prevailing yield of	interest bearing loan with interest
one year, three-year, five year or	rates ranging from 10.25% p.a to
ten- year Government Security	14.5% p.s. HOCL waived off the
closest to the tenor of the loan.	interest on the interest-bearing
In our opinion, the Company has	loans with effect from 01.04.2023,
violated the provisions of section	as per the recommendation
186(7) of the Companies Act,	of Inter-Ministerial Committee
2013.	Meeting dated 20.12.2022. All
Had the impact of the above	the loans advanced to HFL were
qualification been considered,	prior to the commencement
as of 31st March 2024, ‘Interest	of the Companies Act, 2013.
Receivables from Related	Further, the Companies Act,
Parties'' under ‘Other Financial	2013 does not restrict the
Assets'' would have increased	company to make any change in
by Rs. 57.26 lakhs, ‘Statutory	the interest rates on the existing
Receivables - Duties & Taxes,	loans appeared in the books
Prepaid Taxes'' under ‘Other	of the company and there is
Current Assets'' would have	no explicit provision/clause in
increased by Rs. 6.36 lakhs,	the said section that restricts
shareholder funds would have	waiver of loan/interest thereon.
increased by Rs. 63.62 lakhs,	Therefore, HOCL waived off the
and for the year ended on that	interest on the interest-bearing
date, ‘Interest Income on Loan	loan considering the operations
to Subsidiary Company'' and net	of HFL have already been closed
income would have increased by	as per CCEA approval dated 29th
Rs. 63.62 lakhs.	Jan 2020. Hence company has not violated the provision of section 186(7) of the companies act 2013.

42. MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

Nil

43. THE DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

Company ensures existence of adequate internal controls through documented policy and procedures laid down in the manuals to be

followed by the executives at various levels. Internal controls are supported by periodical internal audits and management reviews. The management is keen on these issues and initiated various measures such as upgrading the IT infrastructure, evaluating and implementing ERP software, web-based application and establishing connectivity amongst manufacturing units, Corporate office and branch offices for effective and proactive services and businesses.

Audit Committee/Board periodically reviews the internal controls, audit programme, financial results and recommendations, the replies of the management to Government Audit and internal audit etc.

The Company has maintained adequate financial control system, commensurate with the size, scale and complexity of its operations and ensures compliance with various policies, practices and statutes in keeping with the organization''s pace of growth and increasing complexity of operations.

44. CONSERVATION ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A. The steps taken and impact on conservation of energy:

Major Energy Conservation Activities / Projects Implemented in 202324

• Replacement of conventional lights with LED lights: Electrical energy saving Rs.2.89 lakhs/year

• Replacement of Old AC with New 5star rating ACs: Electrical energy saving Rs.0.66 lakhs/year

• Replacement of conventional fan with Energy Efficient BLDC fans: Electrical energy saving Rs.0.55 lakhs/year

• Replacement of conventional motor with energy efficient IE3 motor: Electrical energy savings Rs.1.71 lakhs/year

Company is availing open access power trading, resulting in a saving of Rs.132 lakhs on power cost for the year 2023-24. There is no capital investment on energy conservation equipment''s.

B. Technology Absorption

The specific consumption of raw material has been reduced resulting in a saving of Rs.4186 Lakhs on Raw Material cost through an in-house technology for the year 2023 - 2024.

i. The efforts made towards technology absorption: Nil

ii. The benefits derived like product improvement, cost reduction, product development or import substitution:

• MOC of the DNET section pipe lines changed from CS to PTFE in order to avoid the plant down time due to leakage resulting from corrosion.

• A Proposal put forwarded for the recovery of ACP from TAR

• New Air compressor purchase is in progress with a payback period of 1.7 years. And an expected savings of RS -18765780 /- per year as compared to the existing compressor

iii. In case of imported technology (imported during the last three years reckoned from the beginning of the financial year): Nil

(a) the details of technology imported; NA

(b) the year of import; NA

(c) whether the technology been fully absorbed; NA

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and

iv. the expenditure incurred on Research and Development: Nil

C. FOREIGN EXCHANGE EARNINGS AND OUTGO: NIL

45. STATEMENT CONCERNING DEVELOPMENTAND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

Key Threats include:

• Competition from domestic / imports and fluctuation in the input prices

• High input costs

• High utility costs

• High overheads

• Limited availability of anti-dumping support for the main products Phenol and Acetone.

• High interest cost.

Some risks and concerns:

• High manpower cost per ton of finished product.

• Depreciated plants, requiring high maintenance cost.

• Dumping in main products Phenol / Acetone.

• Volatility in main input Benzene.

• Restriction in taking up new ventures

46. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES WHICH HAVE BECOME OR CEASED TO BE.

Ministry of Chemicals and Fertilizers, Department of Chemicals & Petrochemicals vide No. P 51015/06/2019-Ch. III dated 29-01-2020 informed the decision of Cabinet Committee on Economic Affairs, directing closure of Hindustan Fluorocarbons Limited (HFL), subsidiary company of HOCL, which was approved by the shareholders on 30.03.2020.

Consequent to the decision of the Govt. of India for closure of Subsidiary Company Hindustan Fluorocarbons Ltd., an amount of Rs.75.87 crore has been released as loan from Govt. of India to meet the expenses related to VRS/VSS to employees and settling dues to Bank and other liabilities. HFL is under the process of closure.

47. DEPOSITS:

During the period under review, the Company has not invited or accepted any deposits from the directors, shareholders and public.

48. THE DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE:

Nil

49. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 (‘Act'') and rules made there under, the Company has adopted a Sexual Harassment Policy for women to ensure healthy working environment without fear of prejudice, gender bias and sexual harassment. The policy has been widely disseminated. A Complaint Committee is in existence as per the Act. The Board states that there were no cases or complaints filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

In connection with observance of Sexual Harassment of Women at workplace Prevention week 2023, various programmes were conducted viz., Pledge, a Street Play on POSH Act was carried out by our women employees, Women''s Walkathon Competition, an Awareness session on POSH Act etc.

Annual Report for the year 2023 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

50. VIGILANCE MECHANISM:

Hindustan Organic Chemicals Limited, being a Government Company, a Vigilance Department is already existing in pursuance of CVC Guidelines headed by Chief Vigilance Officer (CVO), HOCL. The Vigilance Mechanism is being handled by the Vigilance Department and the Company has already adopted a Vigilance Manual in pursuance of CVC Guidelines. Vigilance Manual is available on Company''s Website.

51. INTEGRITY PACT

Adoption of Integrity Pact already implemented in HOCL through two (2) no(s) of Independent External Monitor(s)to maintain, foster most ethical and corruption free business environment.

The Integrity Pact Policy adopted by the Company is applicable in respect of all tenders with estimated value above Rs.50 lakhs (excluding export). Your Company has also conducted structured meetings of the Independent External Monitor with Chairman & Managing Director and other Executives. Integrity Pact is being updated as per CVC circulars. Integrity Pact Policy is available on the web site of the Company.

52. WHISTLE BLOWER POLICY

As per the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and as per section 177(9) of the Companies Act, 2013, every listed companies shall formulate a vigil mechanism/ Whistle Blower Policy for directors and employees to report genuine concerns. Your Company has adopted a Whistle Blower Policy to provide appropriate avenues to all permanent employees to make protected disclosure as per the whistle blower policy. The Policy provides for adequate Safeguards against victimization of employees who avail the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company have been denied access to the Chairman of the Audit Committee and that no complaints were received during the year in this regard. The Whistle Blower Policy is placed in the website of the company.

53. GENERAL

No disclosure or reporting is required in respect of the following matters as there were no transactions on these matters during the year under review:

• Issue of equity shares with differential rights as to dividend, voting or otherwise.

• Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

• The Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

• Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

• No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

• No fraud has been reported by the Auditors to the Audit Committee or the Board.

• There is no Corporate Insolvency Resolution Process initiated under the Insolvency and Bankruptcy Code, 2016.

54. ACKNOWLEDGEMENT

The Board of Directors are extremely thankful to all officials of Department of Chemicals & Petro-chemicals, Ministry of Chemicals & Fertilizers, Government of India for the continued support extended to HOCL. The Directors thank the Company''s employees, customers, vendors, investors and other stake holders for their continuous support. The Directors also express their grateful appreciation for the support and co-operation from officials of Governments of Maharashtra, Government of Kerala, and other Government departments and agencies, Banks, financial institutions, local bodies and all Auditors of the company. The Board places on record its gratitude to the members of the Company for their support and confidence in the management. The Directors appreciate and value the contribution made by each member of the Hindustan Organic Chemicals Limited family.

For and on behalf of the Board of Directors of Hindustan Organic Chemicals Limited

Sd/-

Date: 09.08.2024 Sajeev B.

Place: Kochi, Kerala Chairman and Managing Director

---

Mar 31, 2023

The Board of Directors presents herewith the 62^ndAnnual Report of your Company along with the Audited Statement of Accounts for the financial year 2022-23.

1. FINANCIAL RESULTS

The financial results for the year ended 31.03.2023 with the comparative figures of company''s operations for the previous year is as under:

	(Rs. in Lakhs)
	Particulars	2022-23	2021-22
	Revenue from operations	63,143.56	43,367.39
	Other Income	1,154.60	3,142.73
	Total	64,298.16	46,510.12
	Expenditure	69,320.57	49,128.94
	Profit/ (loss) before exceptional item & Tax	(5,022.41)	(2,618.82)
	Less: Exceptional items	-	-
	Profit /(Loss) before Tax	(5,022.41)	(2,618.82)
	Less: Provision of Tax	-	-
	Profit/(Loss) after Tax	(5,022.41)	(2,618.82)
	Other Comprehensive Income for the year, net of tax	782.78	1,602.93
	Total Comprehensive Income for the year	(4,239.63	(1,015.89)

2. RESERVES [Section 134(3)(i)]

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

3. MEMORANDUM OF UNDERSTANDING WITH GOVERNMENT OF INDIA

Company has been entering into a Memorandum of Understanding (MOU) with the Ministry of Chemicals & Fertilizers, Government of India, setting the performance parameters and targets every year. Company secured “Good” rating for the year 2022-23.

4. CONSOLIDATED FINANCIAL STATEMENT

In accordance with the provisions of the Companies Act, 2013 (“the Act”) and IND AS 110 -Consolidated Financial Statement, the audited consolidated financial statement for the period ending 31.03.2023 is provided in the Annual Report.

5. DIVIDEND

In view of the loss incurred during the current year, the Board of Directors do not recommend any Dividend for the year under review.

6. CHANGE IN NATURE OF BUSINESS IF ANY

Consequent to the decision of the Govt. of India for closure of Subsidiary Company Hindustan Fluorocarbons Ltd., an amount of Rs.75.87 crore has been released to the subsidiary company as interest free loan from Govt. of India to meet the expenses related to VRS/VSS to employees and settling dues to Bank and other liabilities.

7. SHARES

The Authorized Share Capital of the company is Rs.3700000000 and the paid-up capital of the company is Rs.3371731000. The company''s shares are listed in BSE (Scrip ID:500449). 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.

8. FINANCIAL HIGHLIGHTS

During the year 2022-23, the company has achieved a Gross Income of Rs.642.98 crore registering an increase of 6.42 % as against the Previous Year Gross Income of Rs.465.10 Crore.

9. NUMBER OF MEETINGS OF BOARD (including the dates of Board and committee meetings indicating the number of meetings attended by each director in every financial year)

During the year the Board Meetings were held on the following dates:

26^th May, 2022, 4^th August, 2022, 9^th November, 2022 and 31^st January, 2023.

During the year the Committee Meetings were held on the following dates:

Audit Committee meeting

26^th May, 2022, 4^th August, 2022, 9^th November, 2022 and 31^st January, 2023.

Stakeholders Relationship Committee Meeting 9^th November, 2022

Nomination & Remuneration Committee meeting 29^th March, 2023

Other details are furnished in the Corporate Governance Report provided asAnnexure I to this Report.

10. EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 of the Companies Act 2013, read with Rule 12 of the Companies(Management and Administration) Rules, 2014 an extract of the Annual Return as at March 31, 2023 is available at www.hoclindia.com/annual-return

11. SUBSIDIARY COMPANY

Your company has one (1) subsidiary company namely; Hindustan Fluorocarbons Limited [HFL]. Ministry of Chemicals and Fertilizers, Department of Chemicals & Petrochemicals vide No. P. 51015/06/2019-Ch. III dated 29^th January, 2020 informed the decision of Cabinet Committee on Economic Affairs, directing closure of HFL, which was approved by the shareholders on 30^th March, 2020. Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of subsidiary company in FormAOC-1 is attached as Annexure II to the Board''s Report.

12. RELATED PARTY TRANSACTIONS

All the Related Party Transactions that were entered into during the financial year were on arm''s length basis and were in ordinary course of business. There were no materially significant transactions with Related Parties during the financial year 2022-2023 which were in conflict with the interest of the Company. Suitable disclosures as required under IND AS-24 have been made in Note No.38 of the Notes to the Standalone Financial Statements.

Particulars of contract/arrangements/transactions made with related parties, pursuant to Section 188(1) of the Companies Act, 2013 in the prescribed form AOC-2 is appended as Annexure IIIwhich forms part of this report.

13. MANAGEMENT DISCUSSION & ANALYSIS REPORT

The details in this regard forms part of Corporate Governance Report as Annexure IV to the Board''s Report.

14. CORPORATE GOVERNANCE

Due to non-availability of One (1) Independent Women Director for the substantial period of FY 2022-23, there has been non-compliance to that extent with various requirements of Corporate Governance under the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and various Rules/ Regulations made there under. The details in this regard forms part of Corporate Governance report to the Annual Report. The requisite certificate from the practicing company secretaries confirming with the conditions of Corporate Governance is attached to the report on Corporate Governance.

15. COMPLIANCE OF CORPORATE GOVERNANCE GUIDELINES ISSUED BY DEPARTMENT OF PUBLIC ENTERPRISES

Department of Public Enterprises [DPE], Government of India, has laid down certain parameters for the purpose of grading the CPSEs on the basis of their compliance with guidelines on Corporate Governance and this report needs to be submitted to the Ministry of Chemicals & Fertilizers, Government of India on Quarterly basis. Company has been complying with the Guidelines on Corporate Governance for CPSEs laid down by DPE and regularly submits reports to the Ministry of Chemicals & fertilizers, Government of India. Applicable grade of 4^thQuater/year ended 31.03.2023 is “Excellent”.The requisite certificate from the practicing company secretaries confirming with the conditions of DPE Corporate Governance guidelines is attached to the report on Corporate Governance.

16. MANNER IN WHICH FORMAL ANNUAL EVALUATION OF PERFORMANCE OF BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS HAS BEEN CARRIED OUT:

The provisions of Section 134 (3)(p) of the Act shall not apply to a Government Company in case the Directors are evaluated by the Ministry, which is administratively in charge of the Company as per its own evaluation methodology. HOCL, being a Government Company, the performance evaluation of the Directors is carried out by the Administrative Ministry (MoC&F), Government of India, as per applicable Government guidelines.

17. KEY MANAGERIAL PERSONNEL:

The following are Key Managerial Personnel of the Company:

a) Shri Sajeev B - Chairman & Managing Director[DIN: 09344438]

b) Shri Yogendra Prasad Shukla-CFO & Director (Finance)[DIN: 09674122]

c) Shri Subramonian H - Company Secretary & Compliance Officer[ACS: 28380]

18. DETAILS OF DIRECTORS AND/OR KMP’SWHO HAVE BEEN APPOINTED OR RESIGNED DURING THE YEAR:

i. As per Govt. of India, Ministry of Chemicals & Fertilizers, Department of Chemicals & Petrochemicals Order No.P-51011/2/2020-CHEM.III-CPC dated 22-06-2022., Shri Yogendra Prasad Shukla was appointed as Director (Finance) of HOCL for a period of five years w.e.f date of his assumption of charge of the post or till date of his superannuation or until further orders whichever is the earliest.Accordingly, Director (Finance) assumed charge with effect from 4th July, 2022.

ii. As per Govt. of India, Ministry of Chemicals & Fertilizers, Department of Chemicals & Petrochemicals OM.No.P-51015/12/2014-CHEM.III-CPC dated 14-10-2022, Shri Sanjay Pandey, Joint Secretary and Financial Advisor, Ministry of Social Justice and

Empowerment, Additional Charge JS&FA, Ministry of Chemicals & Fertilizers was appointed as Government Nominee Director of HOCL in place of Shri Satendra Singhwho has been appointed as Additional Secretary, Cabinet Secretariat.

iii. As per Govt. of India, Ministry of Chemicals & Fertilizers, Department of Chemicals & Petrochemicals OM No..P-51015/12/2014-CHEM.III-CPC dated 13-12-2022., Shri Sanjay Rastogi was nominated as Government Nominee of HOCL in place of Shri Sanjay Pandey.

19. PARTICULARS OF EMPLOYEES

Information regarding particulars of employees drawing remuneration in excess of the limit specified under Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is not applicable as none of the employees of the Company has drawn remuneration in excess of the stipulated limit, during the year under review.

20. COMPOSITION OF AUDIT COMMITTEE (AC) AND NON-ACCEPTANCE OF ANY RECOMMENDATIONS OF AC (only for publicand listed companies).

During the FY 2022-23, all the recommendations of the Audit Committee were accepted by Board of Directors.

As on 31^st March, 2023 Audit Committee has 3 members in compliance with Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Details of Composition, meetings of Audit Committee/Sub-Committee are provided in Corporate Governance Report in Annexure IV to this Report.

21. COMMITTEES OF THE BOARD

The Company''s Board has the following Committees:

i. Audit Committee

ii. Nomination and Remuneration Committee

iii. Stakeholder Relationship Committee

iv. Corporate Social Responsibility Committee (CSR)

22. SECRETARIAL STANDARDS

The Company complies with all applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

23. DIRECTOR’S RESPONSIBILITY STATEMENT

The financial statements are prepared in accordance with the Indian Accounting Standards (IND AS), the provisions of Companies Act, 2013 and guidelines issued by SEBI. The IND AS are prescribed under Section 133 of Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and relevant amendments, rules issued thereafter. Your Directors make the following statement in terms of Section 134(5) of the Companies Act, 2013 -

i. That in the preparation of the annual accounts for the year ended 31^st March, 2023; the applicable accounting standards had been followed along with proper explanation relating to material departures.

ii. That such accounting policies as mentioned in the Notes on Accounts had been applied 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 the financial year ended 31^st March, 2023 and the profit or loss of the Company for that period.

iii. That proper and sufficient care had been taken 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.

iv. That the annual accounts for the year ended 31^st March, 2023 had been prepared on a going concern basis.

v. Directors have laid down internal financial controls to be followed by the company and such internal financial controls are adequate and are operating effectively and

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

24. INDEPENDENT DIRECTORS DECLARATION -

The Company has received necessary declaration from each of the Independent Directors that he meets the criteria of independence laid down under section 149 (6) of the Companies Act, 2013 and listing regulations.

25. DISCLOSURE ON REAPPOINTMENT OF INDEPENDENT DIRECTORS

No reappointment of Independent Directors was made during the year under review. (FY 20222023).

26. COMPANY’S POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF DIRECTORS ETC.

As per notification dated 5^th June, 2015 issued by Ministry of Corporate Affairs, provision of section 134(3) (e) of the Companies Act, 2013 regarding disclosure of its policy on Director''s appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a Director and other matter provided under sub- section (3) of section 178 of the Companies Act, 2013 are not applicable to a Government company.

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. The Terms and Conditions of appointment of Independent Directors and other directors, are as per the Government Orders are disclosed on the Company''s website.

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

The provisions of Section 134 (3)(e) of the Act are not applicable to a Government Company. Consequently, details on Company''s policy on Directors'' appointment and other matters are not provided under Section 178 (3) of the Act. Similarly, Section 197 of the Act shall not apply to a Government Company. Consequently, disclosure of the ratio of the remuneration of each Director to the median employee''s remuneration and other such details including the statement showing the names and other particulars of every employee of the Company, who if employed throughout / part of the financial year, was in receipt of remuneration in excess of the limits set out in the Rules are not provided in terms of Section 197 (12) of the Act read with Rule 5 (1) / (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.The Chairman & Managing Director and the Whole-time Directors of the Company did not receive any remuneration or commission from any of its Subsidiaries. HOCL, being a Government Company, its Directors are appointed / nominated by the Government of India as per the Government / DPE Guidelines which also include fixation of pay criteria for determining qualifications and other matters.

28. AUDITORS

a) Statutory Auditors

M/s. Balan & Co, Chartered Accountants, was appointed as Statutory Auditors of your Company for Corporate Office and Kochi Unit for FY 2022-2023 by C&Ag.

The auditors have furnished a declaration confirming their independence as well as their arm''s length relationship with the Company as well as declaring that they have not taken up any prohibited non-audit assignments for the Company. The Audit Committee reviews the independence and objectivity of the Auditors and the effectiveness of the audit process. The auditors attend the Annual General Meeting of the Company.

The Auditors in their report for the year have not reported any instances of fraud committed by the officers/employees of the company.

b) Cost Auditors

The Board of Directors had appointed R.M Bansal & Co., Cost Accountants, Kanpur having branch office at Tc 49/620(2) safnamMrwa 61-A, Malliyidom, Thiruvanathapuram - 695009 as Cost Auditors of your Company for FY 2022-2023. In the 61^st AGM held on 29^th September, 2023 the members have ratified the remuneration payable to the Cost Auditors.

c) Internal Auditors

M/s. Isaac & Suresh, Chartered Accountants were re-appointed as Internal Auditor of your Company for Corporate office and Kochi unit for FY 2022-2023.

d) CAG Auditors

Supplementary Audit is conducted by Principal Director of Audit (Shipping), Mumbai. CAG vide letter dated 8th August, 2023 issued Non-Review Report for Standalone and Consolidated financial statements for the year ended 30th March, 2023.

e) Secretarial Auditors

The Board of Directors had appointed D. S. Momaya & Co., Practising Company Secretaries to conduct Secretarial Audit for the FY 2022-2023. The Secretarial Audit Report for the Financial Year ended 31^st March, 2023 is annexed to this Report as and complied with Section 204 of Companies Act and Regulation 24A of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015. The Company has also obtained Annual Secretarial Compliance Report form the PCS D. S. Momaya& Co. for the year 2022-23 under Regulation 24A of Listing Regulation. The observations in the Secretarial Audit report and the management response thereof are given below;

Sl No.	Observation	Management Response
1.	The Board of Directors of the Company was not duly constituted for the FY 2022-23, due to vacancy of One (1) Independent Women Director on Company''s Board.	HOCL is a CPSE (Central PSU/PSE) under the administrative control of the Ministry of Chemicals & Fertilizers (MoC&F), Dept. of Chemicals and Petro Chemicals (DCPC), Government of India. Hence, the MoC&F is the administrative ministry and as per Company''s Articles of Association (AOA), the powers to appoint the Board of Directors of HOCL company vest with the GOI/ Administrative Ministry. Presently, there is vacancy of one (1) Independent Women Director in HOCL. In order to fill the vacancy, Company vide letter dated 16th June, 2022 and 13th September, 2022 and e-mail dated 10th January, 2023 and again on 15th June, 2023 requested the Administrative Ministry to appoint one (1) Women Independent Director on HOCL Board. Company is awaiting necessary orders from the ministry in this regard.

		Sl No.	Observation			Management Response
		2.	The Company, during the period under review, has maintained Structured Digital Database (herein after referred to as “SDD” or the “Database”) but as required under Regulation 3(5) & 3(6) of PIT Regulations, 2015 with respect to the time stamping, audit trails and non-tampering of the data could not be established.			In HOCL, financial results are identified as UPSI. Accordingly, the department concerned is informed about the compliance requirement as per SEBI (Prohibition of Insider Trading) Regulations, 2015. In compliance of Reg 3(5), Company is maintaining SDD and have recorded necessary details stipulated in the Reg 3(5) and the digital signature of Company secretary is affixed to record time stamp and to avoid any non -tampering of data. Once the UPSI is shared, recorded in the database and finalized, digital signature is affixed by the Company Secretary which contains the system generated date and time. After completion of entry is made in the SDD and DSC is affixed, data cannot be tampered. Digital signature serves the purpose of both Time Stamping and Audit Trail to prevent any unauthorized modifications. Accordingly, a mechanism is in place to ensure records in the database is not editable after affixing the DSC in database.The access to such database is strictly with the Company Secretary and very limited access to such database is permitted. Further, SEBI PIT Regulations is silent about the procedure on how such database has to be maintained and it is the discretion of the Company for handling and maintenance of such database. Accordingly, no software is maintained by the company for recording SDD.
30. Details of vigilance cases for the Financial Year 2022-23
	Opening balance as on 01.04.2022				Vigilance cases received during 01.04.2022 to 31.03.2023			Disposed off	Balance
	NIL				0			0	NIL
31.	Status of pending CAG Paras and Management Replies
	Name of the Audit Para			Brief of the para			Reporting status
	Para No.2.1 of C&AG Report No.13 of 2014			Irregularities in the transfer of autonomous management of HOCL school to Mahatma Education Society and unauthorized favors to Mahatma Education Society for expanding its activities and also failed to recover lease rent of Rs.6.54 crore.			HOCL has entered into an agreement on 16.10.2006 to lease the infrastructure facilities to Mahatma Education Society(MES) for managing the school for a period of 30 years. The management of MES in order to start professional courses has constructed new buildings and facilities in the premises in contravention of the terms of agreement. The Company has sent a notice for termination as per the terms of the agreement with MES. MES has filed a petition challenging the termination notice in the Dist. Magistrates Court Alibag. MES has filed petition in the Bombay High Court for appointment of Arbitrator in the dispute between HOCL and MES. The District Court has granted stay pending the final disposal of the Arbitration petition of MES. Company has filed a petition to vacate the stay granted by the District Court in the Bombay High Court. At present, the petitions are pending before the Hon''ble Bombay High court to be heard.

32. SAFETY, HEALTH AND ENVIRONMENT

In the areas of Health, Hygiene and Environment, the company has undertaken periodic medical examination, as well as statutory requirements of fitness check-up were carried out during the year 2022 forour employees. Audiometry tests were carried out for those who are exposed with Noise and Autotoxicity tests were carried out for the Benzene handlers apart from other statutory regular check-ups.

Periodic awareness session on Hygiene, Healthy living, Covid precautions and guidelines were imparted.

In our commitment to Environment, we have ensured that the level of pollutants from the Factory and nearby surroundings was much below the permissible levels.

As part of protecting the environment, awareness sessions, competitions, Swachh Bharat activities, promoting employees for vegetable cultivation under a “Green Mission”, Beautification of the plant premises involving the entire employees of the organization were carried out. Online Effluent Monitoring and stack monitoring system is implemented to comply withthe Central Pollution Control Board regulations. Periodic inspections and safety walk were carried out by the Safety Committee members in addition to the daily patrolling of Fire crew as a continual improvement

HOCL is an IMS (Integrated Management System) certified organisation comprising of Quality Management System (ISO-9001), Environment Management System (ISO-14001) and Occupational Health and Safety Management System (ISO 45001). Company is also certified for Energy Management System (ISO-50001).

The Company has implemented severalnew measures to improve the safety culture in addition to the normal systems and procedures.

1. HSE suggestion scheme

A new initiative which aims to encourage the employees to put forward their creative and potential ideas that could lead to considerable improvements in Safety, Reduction in wastages, Health of employees, protecting the flora and fauna or the natural resources through operational controls and Best practices. Also, to acquire inputs on HSE where others wise we wouldn''t receive.

2. Pre-Start-up Safety Review (PSSR)

PSSRs are built to avoid workplace incidents and resultant equipment damage or employee harm. It is a safety checklist covering check points related to electrical, mechanical, instrumentation, fire & safety, production and utility departments. PSSR is carried out for the following types of start-ups

a. New equipment

b. Modified existing equipment

c. Process changes

d. Major turnaround (28 days and above)

3. Portable Appliance Testing (PAT)

PAT is the process of checking electrical appliances for safety through a series of visual inspections and electronic tests. This is the best way of ensuring that appliances are safe to operate.

Our Quality Control Department introduced PAT system on electrical equipment before taking it in a stream of analysis. Electrical Department or Shift In charge (QC) will carry out Portable Appliance Test and marked ''''TESTED OK'''' with date on the equipment

4. Behavioural Based Safety (BBS)

Psychology is the study of human behaviour, and individual behaviour is a recognised impediment to upholding high standards of health and safety. Many people know what they are doing is incorrect, but they still choose to do it anyway. Other people make mistakes unintentionally, and those people can be instructed in behavioural safety. In order to prevent and control human behaviour and prevent accidents, behaviour-based safety program has gained importance.

The company has its own online work permit system integrating 6 separate work permits viz, Hot work, Cold work, Confined space entry, Work at height, Excavation and Radiography. HOCL has developed benchmark in Accident /incident investigation through a 29-point accident investigation checklist. The company has implemented Near Miss reporting system whereby employees can report any unsafe acts/conditions and corrective actions shall be taken after a review to prevent accidents.

Refresher training sessions on Fire and safety were imparted to the employees. Additional safety training for truck drivers were given for creating a safety culture in driving. Awareness programs related to Fire & Safety were conducted for nearby public in association with the Department of Factories and Boilers, Govt of Kerala. Fire Safety awareness and practical training imparted to nearby school students to inculcate a safety culture in the young minds.Also, provided Fire Extinguishers for the School building. Various competitions were organized for creating more awareness on safety among employees, observed National Safety day,National fire service week, Road safety week etc.

Awareness sessions on Healthy food habits were conducted and the campus has been declared as “Eat Right Campus” by FSSAI. A Bio gas plant is commissioned in the canteen for treating food waste as part of Cleanliness Mission and Swachhta action by Govt. of India. Many initiatives have been taken in reducing food waste, Cooking Oil, safe disposal of used cooking oil through authorised agencies.

HOCL bagged “First Prize in Kerala State Industrial SafetyAward 2022” from the Department of Factories and Boilers, Government of Kerala and received “SurakshaPuraskar Award 2022” for the 4^th consecutive year from M/s. National Safety Council, Kochi Chapter. Our employees have participated in the State level competitions conducted by M/s. National Safety Council,Kerala Chapter held in connection with National Safety day and won prizes.The company has achieved 797392 safe man hours for the year 2022 with no lost time accidents in the organization.

33. RESERVATION AND OTHER WELFARE MEASURES FOR SCHEDULED CASTES/ SCHEDULED TRIBES/ OTHER BACKWARD CLASSES AND PERSONS WITH DISABILITIES.

All guidelines laid down in respect of Reservation and other welfare measures for Scheduled castes/Scheduled Tribes/Other Backward Classes are complied with. The provisions for special arrangement for Persons with Disabilities at work place have been complied with.

Representation of SC, ST and Women in employment position as on 31.03.2023
	Category	Total	SC	ST	WOMEN
	A	76	8	5	6
	B	22	5	3	-
	C	75	13	2	8
	D	10	1		-
	Total	183	27	10	14

34. IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY.

During the year under report, the company continued its efforts to promote Hindi as Official Language in its day to day official activities. 09 Hindi workshops were conducted during the year including a special session on Annual Programme 2022-23 on Official language for HOD''s and Senior Officers of Corporate office and Kochi. Hindi week and Hindi Fortnight were organized at Corporate office and Kochi units on 14^th - 21^st September and 14^th- 29^th September respectively. Our officers attended second All India Rajbhasha Seminar organized by Dept of OL, Ministry of Home Affairs at Surat, Gujrat on 14 & 15 September 2022. During Hindi Week/Fortnight celebrations, various competitions were also organized and large number of employees participated. Our company received Third prize for best implementation of OL Policy from Hon'' Minister of Chemicals and Fertilizers. HOCL, Kochi Unit also bagged First prize for the best implementation of OL policy by Town official language Implementation Committee (TOLIC). Our Corporate and Kochi Unit were inspected by the First sub-committee of the Parliamentary Committee on Official Language at Mumbai and Kochi on 11.07.2022 & 15.10.2022 respectively. Our both offices were actively participated in various programmes conducted by TOLIC (PSU). One Day OL seminar for exclusively Hindi Staff of TOLIC''s (Central Govt and PSU) of Kochi was conducted on 15 November 2022 in our office premises. Our officers were attended various OL seminars organized by FACT, HPCL, Cochin Shipyard, Kochi TOLIC (PSU) and Kochi TOLIC (Bank) attended Regional Joint Conference on Official Language conducted by Dept of OL at Thiruvananthapuram. Hindi Quiz competition organized in our office during Joint Hindi celebration of Kochi TOLIC(PSU). To make awareness among students the importance of Hindi, celebrated World Hindi Day on 10^th January 2023 at Govt Girls HSS, Tripunitura, Ernakulam. An e-magazine “Pahachan” was published by the company during the period. All documents under section 3(3) of OL Act 1963 were issued both in Hindi and English. The Website of the company is available both in Hindi and English. Various promotional scheme including incentives for better implementation of Official Language has been adopted by our organization.

35. CITIZEN’S CHARTER, PUBLIC GRIEVANCE REDRESSAL (PG), CUSTOMER CARE SYSTEM (CCS) & RIGHT TO INFORMATION (RTI)

In line with the provisions of RTI Act 2005 to promote transparency and accountability, our organisation has taken efforts to handle the Right to Information sought for. Company has laid down procedure to provide information through Public Information Officer/CPIO and Appellate Authority.

RTI applications-Summary

The organization believes the following principles to align with the business processes.

1. Customer focus

2. Leadership

3. Utilization of resources with improved information flow within the organization

4. Process approach; &its Continual improvement,

5. Risk & opportunity and real time decisions

6. Developing internal resources & maintaining better human relations at work.

We have adopted the “Process Approach” into daily operations including the PDCA Cycle. We have considered the utilization of Risk-Based Thinking when developing, implementing, and improving the effectiveness in most of our Management System. This approach enables Hindustan Organic Chemicals Limited to enhance the overall performance of the Organization by effectively controlling the interrelationships and the interdependencies among the processes. The understanding and consistency with achieving customer specific requirements;

• The consideration of our processes in terms of added value;

• The achievement of effective process performance;

• Improvement of our processes based on real time data and information.

We also effectively plan and implement various actions to address risks and opportunities to maximize the outcomes including, but not limited to achieving improved results and preventing negative effects of our products, Operations, services.

Our businesses provide goods and services that are safe and contribute to sustainability throughout their life cycle and to promote the wellbeing of all employees, respect the interests of the stake holders, responsive towards all stake holders, especially those who are disadvantaged, vulnerable and marginalized. Our businesses respect, protect, and make efforts to restore the environment in a safe and better manner by complying with the relevant Statutory regulations. Our businesses also support and provide value to their customers and consumers in a responsible manner.

38. DETAILS OF CSR POLICY AND ITS IMPLEMENTATION DURING THE YEAR

Company since its inception is very much aware about its social responsibility. For over five decades, as a socially responsible and sensitive corporate, your Company continues to remain committed to social thought and action to serve society through providing basic civic amenities to the neighbouring villages, rendering assistance in different forms.

As the average of three immediately preceding financial year is net loss, your Company is not required to carry out any CSR activities during the year under review. However, Company has recognized its social obligations and extended the following during the year 2022-23.

The number of RTI applications received and disposed off during the year 2022-23 is given below:

	Total number of RTI applications received during the year 2022-23	48
	Applications rejected during the year 2022-23, if any	0
	Information submitted during the year 2022-23	45
	Pending to reply as on 31.03.2023	31
* Reply to RTI application has been submitted subsequently.

36. MICRO & SMALL ENTERPRISES

All efforts have been taken to comply with the Government Directive to procure items specified for procurement from MSMEs. Necessary procedures have been made in all tenders re-stating the eligibility of MSMEs so as to participate in tenders. We have removed the restricted clauses in the tender conditions and modified the same which will help in greater participation of MSMEs and especially SC/ST MSMEs in the procurement processes. Company has modified the purchase policy also to comply with the directions.

HOCL always takes efforts to fulfill the requirements. Our 95% of the purchases by value are petroleum products (LPG, Benzene, Furnace Oil, Hydrogen which are our raw materials.) supplied by M/S. BPCL through pipeline transfer. These items are not manufactured by MSME''^s and not available in GeM portal.

37. SOCIAL, ENVIRONMENTAL AND ECONOMIC RESPONSIBILITIES AND BUSINESS RESPONSIBILITY REPORT

SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015 with regard to disclosure of Business Responsibility Report is not applicable to your company. However, Hindustan Organic Chemicals Limited has adopted and realizes the benefits of Management Principles into daily activities to achieve the goals of the organization. These Management Principles will provide a foundation to continually improve upon the Organization''s performance.

Circulars issued to avoid single use plastic items and declared as “Plastic free zone”. Swachhta activities were conducted by different departments from 01.09.2022 onwards. Segregation and weeding out of old records, enlisting and keeping the same is still going on.

Awareness session conducted by the Company Medical Officer on Better Hygiene to the House keeping staff, Security personnel etc.

Various Competitions (in English/ Hindi/ Malayalam) were organized for the employees, apprentices/trainees &High School and College going students.

Swachhta cleaning activities done at Township with participation of wards, residents, employees and contract workers.

39. INDUSTRIAL RELATIONS:

The overall Industrial Relation situation continues to be peaceful and cordial during the year 2022-23. There was no strike or lockout during the year.

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

There are no loans, guarantees, or investments made by the company under Section 186 of the Companies Act 2013 during the year under review and hence said provisions are not applicable.

Consequent to the decision of the Govt. of India for closure of Subsidiary Company Hindustan Fluorocarbons Ltd., an amount of Rs.75.87 crore has been released as loan from Govt. of India to meet the expenses related to VRS/VSS to employees and settling dues to Bank and other liabilities.

41. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND PRACTISING COMPANY SECRETARY IN THEIR REPORTS

There are no qualifications, reservations or adverse remarks made by the Statutory Auditors in their audit report for the Financial Year 2022-23.

The Secretarial Auditors of the company have submitted their Secretarial Audit Report for the year 2022-23. Reply to observations of Secretarial auditors is given in the director''s report.

42. MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

Nil

43. THE DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS:

Company ensures existence of adequate internal controls through documented policy and procedures laid down in the manuals to be followed by the executives at various levels. Internal controls are supported by periodical internal audits and management reviews. The management is keen on these issues and initiated various measures such as upgrading the IT infrastructure, evaluating and implementing ERP software, web-based application and establishing connectivity amongst manufacturing units, Corporate office and branch offices for effective and proactive services and businesses.

Board periodically reviews the internal controls, audit programme, financial results and recommendations, the replies of the management to Government Audit and internal audit etc. The Company has maintained adequate financial control system, commensurate with the size, scale and complexity of its operations and ensures compliance with various policies, practices and statutes in keeping with the organization''s pace of growth and increasing complexity of operations.

44. CONSERVATION ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A. The steps taken and impact on conservation of energy:

Major Energy Conservation Activities / Projects Implemented in 2022-23

• Replacement of conventional lights with LED lights: Electrical energy saving Rs.6.78 lakhs/year

• Replacement of Old AC with New 5star rating ACs: Electrical energy saving Rs.0.11 lakhs/year

• Replacement of conventional fan with Energy Effcient BLDC fans: Electrical energy saving Rs.0.33 lakhs/year

• Replacement of conventional motor with energy efficient IE3 motor: Electrical energy savings Rs.0.43 lakhs/year

• Contract demand reduction of Township: annual saving of Rs.1.31Lakhs/year

Company is availing open access power trading, resulting in a saving of Rs.59 lakhs on power cost for the year 2022-23.

B. Technology Absorption

The specific consumption of raw material has been reduced resulting in a saving of Rs 1330 Lakhs on Raw Material cost through an in-house technology for the year 2022 - 2023

i. the efforts made towards technology absorption: Nil

ii. the benefits derived like product improvement, cost reduction, product development or import substitution: Nil

iii. in case of imported technology (imported during the last three years reckoned from the beginning of the financial year): Nil

(a) the details of technology imported;

(b) the year of import;

(c) whether the technology been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and

iv. the expenditure incurred on Research and Development: Nil

C. FOREIGN EXCHANGE EARNINGS AND OUTGO: NIL

45. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

Key Threats include:

• Competition from domestic / imports and fluctuation in the input prices

• High input costs

• High utility costs

• High overheads

• Continued availability of anti-dumping support for the main products Phenol and Acetone.

• Working Capital availability for continuous operations

• High interest cost and employee remuneration.

Some risks and concerns:

• High manpower cost per ton of finished product.

• Depreciated plants, requiring high maintenance cost.

• Dumping in main products Phenol / Acetone.

• Volatility in main input Benzene.

• COVID-19 impact on downstream industries.

46. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES WHICH HAVE BECOME OR CEASED TO BE.

Ministry of Chemicals and Fertilizers, Department of Chemicals & Petrochemicals vide No. P. 51015/06/2019-Ch. III dated 29-01-2020 informed the decision of Cabinet Committee on Economic Affairs, directing closure of Hindustan Fluorocarbons Limited, Subsidiary of HOCL, which was approved by the shareholders on 30-03-2020.

Consequent to the decision of the Govt. of India for closure of Subsidiary Company Hindustan Fluorocarbons Ltd., an amount of Rs.75.87 crore has been released as loan from Govt. of India to meet the expenses related to VRS/VSS to employees and settling dues to Bank and other liabilities.

47. DEPOSITS: NIL

During the period under review, the Company has not invited or accepted any deposits from the directors, shareholders and public

48. THE DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS

OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY’S OPERATIONS IN FUTURE:

Nil

49. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition &Redressal) Act, 2013 (''Act'') and rules made there under, the Company has adopted a Sexual Harassment Policy for women to ensure healthy working environment without fear of prejudice, gender bias and sexual harassment. The policy has been widely disseminated. A Complaint Committee is in existence as per the Act. The Board states that there were no cases or complaints filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Annual Report for the year 2022 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

50. VIGILANCE MECHANISM: (Under Sec.177(9) of Companies Act,2013)

Hindustan Organic Chemicals Limited, being a Government Company, a Vigilance Department is already existing in pursuance of CVC Guidelines headed by Chief Vigilance Officer (CVO),HOCLTheVigilance Mechanism is being handled by the Vigilance Department and the Company has already adopted a Vigilance Manual in pursuance of CVC Guidelines. Vigilance Manual(latest) is available on Company''s Website.

51. INTEGRITY PACT

Adoption of Integrity Pact alreadyimplemented in HOCL through two (2) no(s) of Independent External Monitor(s)to maintain, foster most ethical and corruption free business environment. The Integrity Pact Policy adopted by the Company is applicable in respect of all tenders with estimated value above Rupees Fifty Lakh (excluding export). Your Company has also conducted structured meetings of the Independent External Monitor with Chairman & Managing Director and other Executives. Integrity Pact Policy has been uploaded on the web site of the Company.

52. WHISTLE BLOWER POLICY

As per the Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and as per section 177(9) of the Companies Act, 2013, every listed companies shall formulate a vigil mechanism/ Whistle Blower Policy for directors and employees to report genuine concerns. Your Company has adopted a Whistle Blower Policy to provide appropriate avenues to all permanent employees to make protected disclosure as per the whistle blower policy. The Policy provides for adequate Safeguards against victimization of employees who avail the mechanism and also provides for direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company have been denied access to the Chairman of the Audit Committee and that no complaints were received during the year in this regard. The Whistle Blower Policy is placed in the website of the company.

53. GENERAL

No disclosure or reporting is required in respect of the following matters as there were no transactions on these items during the year under review:

• Issue of equity shares with differential rights as to dividend, voting or otherwise.

• Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

• The Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefit of employees.

• Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

• No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future save and except mentioned above during previous year.

• No fraud has been reported by the Auditors to the Audit Committee or the Board.

• There is no Corporate Insolvency Resolution Process initiated under the Insolvency and Bankruptcy Code, 2016.

54. ACKNOWLEDGEMENT

Board places on record its gratitude to the members of the Company for their continued support and confidence in the management

The Directors thank the Company''s employees, customers, vendors, investors and other stake holders for their continuous support. The Directors also thank the Department of Chemicals and Fertilizers, Ministry of Chemicals and Fertilizers, Government of India, Governments of Maharashtra and Government of Kerala, and other Government departments and agencies, Banks, financial institutions for their co-operation. The Directors regret the loss of life due to COVID-19 pandemic and are deeply grateful and have immense respect for every person who risked their life and safety to fight this pandemic. The Directors appreciate and value the contribution made by each member of the Hindustan Organic Chemicals Limited family.

For and on behalf of the Board of Directors of Hindustan Organic Chemicals Limited

1

Extended vocational training facilities to the students of Engineering/Science/Management colleges for imparting practical knowledge.

• Advanced training imparted to students who have completed their graduation in various disciplines to equip them to take up jobs in industries.

• Factory visits are permitted for the students undergoing courses relevant to Chemical/ petrochemical industry to provide them a First-hand knowledge of the industry

• Engaged professional students of CS/CMA who have completed intermediate level as trainees for imparting practical knowledge.

• Installed 3 Nos. of Napkin Incinerators at Factory and Township Other activities.

SWACHH BHARAT ABHIYAN

Conducted various activities in connection with the SwachhtaPakhwada 2022. Cleanliness drives were conducted outside the Company also. A Cleanliness drive was conducted by HOCL employees at a nearby Government School (Govt. UP School, Puttumanoor). “A Safety awareness class for the students and parents” were also conducted and donated DCP Fire Extinguishers to the School.

---

Mar 31, 2018

The Board of Directors presents herewith the 57^th Annual Report of your Company along with the Auditors statement of Accounts for the financial year 2017-18.

A. FINANCIAL RESULTS

The financial results for the year ended 31.03.2018 with the comparative figures of Company’s operations for the previous year is as under:

(Rs. In Lakhs)

Particulars	2017-18	2016-17
Revenue from operations	24232.94	14330.51
Other Income	6630.47	627.59
Total	30863.41	14958.10
Expenditure	50129.82	39255.36
Profit before Depreciation & Tax	(-)19266.41	(-)24297.26
Less Depreciation	680.54	1260.20
Profit /(Loss) before Exceptional Items and Tax	(-)19946.95	(-)25557.46
Less : Exceptional Items	-	-
Less : Provision of Tax (1) Current Tax	-	-
(2) Deferred Tax	-	-
Profit/(Loss) for the Period	(-)19946.95	(-)25557.46
Other Comprehensive Income :
(i). Items that will not be classified to Profit or Loss	12478.07	-
a). Revaluation of Plant , Property & Equipment’s	(2793.25)	357.33
Less : Deferred Tax Assets	873.02	-
b). Changes in defined benefit plan
Other Comprehensive Income for the year, Net of Tax	10557.84	357.33
Total Other Comprehensive Income for the year	(9389.11)	(25200.13)

B. DIVIDEND

In view of the continuous losses during the current year as well as in the previous years, the Board of Directors do not recommend any Dividend for the current year under review.

C. CHANGE IN NATURE OF BUSINESS IF ANY

As per the approval of Government of India, the operation of the all the plants at Rasayani Unit (except C NA / N204 plant along with the manpower transferred to ISRO) has been closed. In Kochi Unit, two plants (Phenol and Hydrogen plant) is operational.

Further Government has approved sale of 442 acre of land at Rasayani to BPCL for Rs.618.80 crore. Out of the 442 acre, sale of 251 acre has been completed for which an amount of Rs.351.40 crore has been received from BPCL and in addition, a bridge loan of Rs.360.26 crore has been received from GoI, which has been utilized to clear liabilities partially and for implementation of VRS to the employees of the Rasayani unit of the company.

D. FINANCIAL HIGHLIGHTS

During the year 2017-18 the Company registered an impressive growth of 106 % under Revenue .The Gross income of the Company stood at Rs.308.63 crore as against Rs.149.58 crore achieved during the previous year. The Loss before Tax for the year 2017-18 was (-) Rs.199.47 crore as against (-) Rs.255.57 crore incurred during the corresponding period of last year.

E. NUMBER OF MEETINGS OF BOARD (including the dates of Board and committee meetings indicating the number of meetings attended by each director in every financial year)

During the year the Board Meetings were held on the following dates:

29^th May 2017, 19^th July 2017, 26^th July 2017, 12^th September 2017, 11^th December 2017, 9^th February 2018 and 16^th March 2018.

OTHER DETAILS ARE FURNISHED IN THE Corporate Governance Report in Annexure VI to this Report.

F. MANNER IN WHICH FORMAL ANNUAL EVALUATION OF PERFORMANCE OF BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS HAS BEEN CARRIED OUT :

HOCL being CPSU governed by the DPE Guidelines the Annual Evaluation of Performance of Board, its committees and of individual Directors have been carried out by the Administrative Ministry (DCPC).

G. However, as the appointment of adequate number (2/3) of independent directors on Company’s Board was taken place only during Feb., 2017 resulting in reconstitution of the Board committee/s only in March, 2017 (and thereafter), Board Committees’ evaluation during the year did not arise.

H. DETAILS OF DIRECTORS AND/OR KMP’S WHO HAVE BEEN APPOINTED OR RESIGNED DURING THE YEAR

None

I. COMPOSITION OF AC AND NON ACCEPTANCE OF ANY RECOMMENDATIONS OF AC

(only for public and listed companies)

The Audit Committee has been reconstituted during the year; - No such cases.

J. DIRECTOR’S RESPONSIBILITY STATEMENT

Your Directors make the following statement in terms of Section 134(5) of the Companies Act, 2013 -

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

b. That such accounting policies as mentioned in the Notes of Accounts had been applied 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 financial year ended 31st March, 2018 and the profit or loss of the Company for that period.

c. That proper and sufficient care had been taken 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. That the annual accounts for the year ended 31st March, 2018 had been prepared on a going concern basis.

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

K. INDEPENDENT DIRECTORS DECLARATION - submitted on appointment.

L. DISCLOSURE ON REAPPOINTMENT OF INDEPENDENT DIRECTORS -not applicable.

M. COMPANIES POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF DIRECTORS ETC.

Company being a CPSE and appointment 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 directors of the DC&PC; the prescribed DPE Guidelines are being followed. The Terms and Conditions of appointment of Independent and other directors as disclosed in the Company’s website are given in Annexure to this Report.

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

Company being a CPSE which is under the supervision, control and directors of the DC&PC, the prescribed DPE Guidelines are being followed in respect of employee’s remunerations and DPE Guidelines as well as CVC Guidelines are being followed, as regards other prescribed perquisites

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

There are no loans, Guarantees, or investments made by the company under Section 186 of the Companies Act 2013 during the year under review and hence said provisions are not applicable.

However, the cumulative investment on the Subsidiary Company Hindustan Fluorocarbons ltd., 31.3.2018 stood at Rs.11.06 Crore. In addition, the company has given Secure Loan of Rs.35.10 Crores to HFL [on the security of HFL Land] and Company has also extended Corporate Guarantee to the working Capital loan to the subsidiary company HFL and investments made in HFL and HOC Chematur Ltd., during earlier years under section 186 of the Companies Act 2013, were shown in the financial statements.

P. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

- None

1. Details of Contracts or arrangement or transactions not at arm’s length basis:

a) Name(s) of related party and nature of relationship

b) Nature of Contracts/arrangements/transactions

c) Duration of contracts/arrangements/transactions

d) Salient terms of the contracts or arrangements or transactions including the including the value if any

e) Justification for entering into such contracts or arrangements or transactions date (s) of approval by the Board

f) Amount paid as advances, if any

g) Date on which a special resolution was passed in general meeting as required under first proviso to section 188

2. Details of material contracts or arrangements or transactions at arm’s length basis; : -None.

(a) Name(s) of related party and nature of relationship

b) Nature of contracts/arrangements/transactions

c) Duration of contracts/arrangements/transactions

d) Salient terms of the contracts or arrangements or transactions including the value, if any:

e) Date(s) of approval by the Board if any:

f) Amount paid as advance, if any:

Q. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND PRACTISING COMPANY SECRETARY IN THEIR REPORTS

There were no qualifications, reservations or adverse remarks made by the Auditors in their Audit report. The replies to the observations of the auditors are forming part of the Directors Report.

The Secretarial Auditors of the company have submitted their Secretarial Audit Report for the year 2017-18 and management replies to the audit observations thereof are annexed to the Directors’ Report and forming part of 57^th Annual Report of the Company.

The observations of the auditors and notes to accounts are self - explanatory, and are forming part of the Directors’ Report.

R. AMOUNTS IF ANY WHICH IT PROPOSES TO CARRY TO RESERVES

None - In view of the accumulated losses and loss incurred during the year.

S. MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEENT THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

The closure of all the non-viable plants at Rasayani Unit and transfer to the CNA/ N204 plant to ISRO as per the approval of the Government of India, GoI released bridge loan of Rs.360.26 crore and the matured Bonds have been paid off and all statutory liabilities has been cleared out of the bridge loan. Further out of 442 acre of land sale approved by GoI, 251 acre has been registered and received Rs.351.40 crore as consideration. The VRS has been implemented at Rasayani and all employees except the skeletal 15 and staff retained 8 have been relieved and their dues have been settled. The working capital loan availed from SBI and Canara Bank has been repaid.

T. The details in respect of adequacy of internal financial controls with reference to the Financial statements :

Company ensures existence of adequate internal controls through documented policy and procedures laid down in the manuals to be followed by the executives at various levels. Internal controls are supported by periodical internal audits and management reviews. The management is keen on these issues and initiated various measures such as upgrading the IT infrastructure, evaluating and implementing ERP software, web based application and establishing connectivity amongst manufacturing units and branch offices for effective and proactive services and businesses.

Board periodically reviews the internal controls, audit programme, financial results and recommendation of the replies of the management to Government Audit and internal audit etc.

U. CONSERVATION ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A) Conservation of energy : Nil

i. The steps taken or impact on conservation of energy : Nil

ii. The steps taken by the company for utilizing alternate sources of energy and : Nil

iii. The capital investment on energy conservation equipments : Nil

B) Technology Absorption : Nil

(i) the efforts made towards technology absorption : Nil

(ii) the benefits derived like product improvement, cost reduction, product development or import substitution : Nil

(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) : Nil

(a) the details of technology imported;

(b) the year of import;

(c) whether the technology been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and

(iv) the expenditure incurred on Research and Development : Nil

V. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

Key Threats include :

o Competition from Imports and fluctuation in the input prices

o High input costs

o High utility costs

o High overheads

o Continued availability of anti-dumping support for the main products Phenol and Acetone.

o Acute working capital shortage affecting continuous operations

o High interest cost and employee remuneration.

Some risks and concerns :

o High manpower cost per ton of finished product.

o Depreciated plants, requiring high maintenance cost.

o Dumping in main products Phenol / Acetone.

o Volatility in main input Benzene.

W. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES WHICH HAVE BECOME OR CEASED TO BE:

HOC Chematur Ltd., a Joint Venture subsidiary abandoned due to non-achievement of the financial closure for the proposed MDI Project and Company has applied to for striking of the name under Early Exit scheme of MCA and ROC has approved the striking of the name of the Company and necessary Gazette notification is awaited.

X. DETAILS OF CSR POLICY AND ITS IMPLEMENTATION DURING THE YEAR

Company has recognized its social obligations and extends the following:

o On closure of Rasayani Unit, Company’s Library Books at Rasayani Unit Library were donated to Dr.Babasaheb Ambedkar Marathwada University, Aurangabad.

o As a part of social obligation the company is extending need based assistance to deserving students along with SC/ST students for their School / Graduate education.

o Vocational training facilities to the wards of employees of the company in the nearby Engineering / Management colleges for enhancing skill / knowledge.

o Engaging professional students of ICAI / ICSI who have completed intermediate level as trainees for imparting practical knowledge of company working by paying stipend.

Y. DISCLOSURES PRESCRIBED IN TERMS OF SECTION 67 (only for public and listed companies)- N.A.

Z. DEPOSITS : Nil

During the period under review, the Company has not invited or accepted any deposits either from the directors or from shareholders of the Company.

The details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company’s operations in future: None

Under Sec.177(10) of Companies Act,2013:

VIGILANCE MECHANISM:

Hindustan Organic Chemicals Limited, being a Government Company, a Vigilance Department is already existing in pursuance of CVC Guidelines. And therefore, Vigilance Mechanism is being handled by the Vigilance Department and the Company has already adopted a Vigilance Manual in pursuance of CVC Guidelines. Vigilance Manual is available on Company’s Website.

Q. ACKNOWLEDGEMENT

Board places on record its gratitude to the members of the Company for their continued support and confidence in the management

For and on behalf of the Board of Directors of

Hindustan Organic Chemicals Limited

Sd/-

Date : 10-08-2018 S.B. Bhide

Place: CBD Belapur Chairman and Managing Director

---

Mar 31, 2016

To the Members of

HINDUSTAN ORGANIC CHEMICALS LIMITED

Dear Shareholders

The Board of Directors presents herewith the 55th Annual Report of your Company along with the Auditors statement of Accounts for the financial year 2015-16.

A. FINANCIAL RESULTS

The financial results for the year ended 31.03.2016 with the comparative figures of Company''s operations for the previous year is as under:

Particulars	2015-16	2014-15
Revenue from operations	10914.77	15013.24
Other Income	489.21	833.03
Total	11403.98	15846.27
Expenditure	27938.55	36515.42
Profit before Depreciation & Tax	(16534.57)	(20669.15)
Less Depreciation	856.49	879.62
Profit /(Loss) before Tax	(17391.06)	(21548.77)
Less : Provision of Tax	0	0
Profit/(Loss) after Tax	(17391.06)	(21548.77)

B. DIVIDEND

In view of continuous incurring of losses during the current year as well as in the previous years, the Board of Directors did not recommend any Dividend for the current year under review.

Status of the Company at BIFR under SIC(SP)Act, 1985 :-

As per BIFR Summary Record of Proceedings of the Hearing of HOCL Case No.501/2014 Held on 22-07-2015 before the Bench, BIFR declared the Company as Sick under Section 3(1)(o) of the Act and appointed State Bank of India as the Operating Agency with directions to prepare a viability study report and revival scheme for the Company, if feasible, keeping in view the provisions of Section 18 of the Act and the guidelines given. BIFR also directed the Company to submit the Draft Rehabilitation Proposal (DRP) with in period of 8 weeks considering the Cut Off Date(COD) as 31-3-2015. BIFR directions also include among other directions, that OA to submit its report thereof before the next date of the hearing (on 4-112015) and to examine the DRP on its receipt from the Company etc. Accordingly during September, 2015 Company had submitted HOCL Revival Study Report of the consultants, M/s. JPS Consultants Pvt. Ltd. to the Administrative Ministry for consideration and a copy thereof to the OA, SBI as per directions. As at the BIFR Board, consequent to demitting of office by Hon''ble Member, all Hearings w.e.f.28^th October, 2015 listed before the Bench of BIFR were postponed till further orders and hence the matter of HOCL was pending in BIFR till a Bench is constituted in BIFR. Later at BIFR, the Bench is constituted and hearing is resumed in April, 2016. Company is at present awaiting further directions from the Ministry as well as from the BIFR.

C. CHANGE IN NATURE OF BUSINESS IF ANY : None

D. FINANCIAL HIGHLIGHTS

The Gross income of the Company stood at Rs.114.04 crore as against Rs.158.46 crore achieved during the previous year. The loss for the year 2015-16 was Rs.173.91 crore as against the loss of Rs.215.48 crore of the corresponding period of last year.

E. NUMBER OF MEETINGS OF BOARD (including the dates of Board and committee meetings indicating the number of meetings attended by each director in every financial year)

During the year the Board Meetings were held on the following dates:

28/04/2015, 28/05/2015, 25/06/2015, 11/08/2015, 03/09/2015, 12/11/2015, 11/02/2016 and 08/03/2016

F. MANNER IN WHICH FORMAL ANNUAL EVALUATION OF PERFORMANCE OF BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS HAS BEEN CARRIED OUT :

HOCL being a CPSU governed by the DPE Guidelines the Annual Evaluation of Performance of Board, its committees and of individual Directors has been carried out by the Administrative Ministry (DCPC).

However, Board Committees evaluation during the year did not arise in view of non existence of Independent Directors during the year under review, on Company''s Board.

G. DETAILS OF DIRECTORS AND/OR KMP’S WHO HAVE BEEN APPOINTED OR RESIGNED DURING THE YEAR.

Government has appointed Shri Samir Kumar Biswas , Joint Secretary (Chemicals), as Official, part time (Govt. Nominee) Director on the Board of the Company, w.e.f. 02/09/2015 in place of Dr. A.J.Vara Prasad, JS

Government has appointed Shri Vinod Kumar Thakral, SS&FA, (C&F), as Official, part time (Govt. Nominee) Director on the Board of the Company, w.e.f. 17/09/2015 in place of Shri Rajiv Yadav, SS&FA.

Government has appointed Shri Sunil Kumar Sharma, Director (Chemicals), as Official, part time (Govt. Nominee) Director on the Board of the Company, w.e.f. 06/05/2016 in place of Shri Vinod Kumar Thakral, SS&FA.

Government has appointed Ms. Pushpa Trivedi, Professor, HSS Dept., IIT Bombay, Powai, Mumbai, as Part time Non Official (Independent &woman) Director on the Board of the Company, w.e.f. 15/06/2016 for a period of 3 years or till further orders, whichever is earlier.

Government, vide Order No. 23011/9/2015-Org.Estt. approved the pre-mature termination of tenure of Shri V.B.Ramchandran Nair, as CMD, HOCL with immediate effect from 22/02/2016 (by payment of 3 moths'' notice pay).

Government, vide order dated 25-02-2016 directed Shri S.B.Bhide, Director (Technical) to hold the additional charge of CMD, HOCL for a period of 3 months which later was extended for further period of 3 months up to 24-08-2016 or till further orders whichever is earlier.

As Director (Finance) Shri Sureshkumar R. was continuous remained absent himself from all the board meetings of the Company for the period of 12 months from March, 2015 to 29/02/2016 . The position of Director (Fin.) of Mr. Sureshkumar has become vacant w.e.f. 01-03-2016. Pursuant to application of Sect. 167 of the Company''s Act , 2013. The company has communicated the facts as such to the Administrative Ministry.

Vide Government Order dated 03-08-2016 The President has approved the non extension of the tenure of Mr. J.N.Suryawanshi, as Director Marketing of the Co. with immediate effect from 03-08-2016. (A.N.)

H. COMPOSITION OF AC AND NON ACCEPTANCE OF ANY RECOMMENDATIONS OF AC None. - Not Applicable.(during the year under review.)

I. DIRECTOR’S RESPONSIBILITY STATEMENT

Your Directors make the following statement in terms of Section 134(5) of the Companies Act, 2013 -

a. That in the preparation of the annual accounts for the year ended 31st March, 2016; the applicable accounting standards had been followed along with proper explanation relating to material departures.

b. That such accounting policies as mentioned in the Notes of Accounts had been applied 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 financial year ended 31st March, 2016 and the profit or loss of the Company for that period.

c. That proper and sufficient care had been taken 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. That the annual accounts for the year ended 31st March, 2016 had been prepared on a going concern basis.

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

f. That, during the year under review, in view of sick unit status of the Company, pending revival, the employees'' salary dues and corresponding statutory dues were unpaid and outstanding for the last 13 Months (March, 2015 to March, 2016 and to that extent various compliances by the KMPs and Directors have not been complied with.

J. DISCLOSURE ON REAPPOINTMENT OF INDEPENDENT DIRECTORS

Not Applicable during the year under review, in view of non-existence of independent directors on the Board of the Company.

K. COMPANIES POLICY ON DIRECTOR’S APPOINTMENT AND REMUNERATION INCLUDING CRITERIA FOR DETERMINING QUALIFICATIONS, POSITIVE ATTRIBUTES, INDEPENDENCE OF DIRECTORS ETC.

Company being a CPSE and appointment 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 DC&PC, the prescribed DPE Guidelines are being followed. The Terms and Conditions of appointment of Independent and other directors as disclosed in the Company''s web site are given in Annexure to this Report.

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

Company being a CPSE which is under the supervision, control and directions of the DC&PC, the prescribed DPE Guidelines are being followed in respect of employees remunerations and DPE Guidelines as well as CVC Guidelines are being followed, as regards other prescribed elaborate disclosures and details.

M. 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 said provisions are not applicable.

However, cumulative total as on 31-03-2016 of the particulars of Secured Loans to its subsidiary Co., viz. HFL, Company''s Rs.11.03 crore, Corporate Guarantee extended to its subsidiary Co., Hindustan Fluorocarbons Ltd.[HFL], or investments made in earlier years in its subsidiary companies viz. in HFL and in HOC Chematur Ltd., etc. under section 186 of the Companies Act, 2013 all were shown in the financial statements. Guarantees including Rs.100 crore 4 year Government Guarantee, Rs. 150 crore, 3 year Government Guarantee renewable on year to year basis , both granted by the Government of India for the issue of respectively, Rs.100 crore and Rs.150 crore Bonds.

N. PARTICULARS OF CONTRACTS OR ARRANGEMENTS MADE WITH RELATED PARTIES

1. Details of Contracts or arrangement or transactions not at arm''s length basis: During the year, NIL.

2. Details of material contracts or arrangements or transactions at arm''s length basis : NIL during the year under review. However, cumulative total as on 31-032016 of the particulars of contracts or arrangements of the previous years'' made with the subsidiaries, were shown in the financial statements.

O. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS AND PRACTISING COMPANY SECRETARY IN THEIR REPORTS

In view of the non-existence of adequate number of Independent directors and woman directors on the Board of the Co., suitable Management Replies to the auditors'' observations in the Secretarial Audit Report -2015 were furnished during the year under review and were considered by the secretarial auditors, M/s. SNA & Co., the PCS. The Secretarial Audit Report annexed hereto, forms part of the Annual Report- 2015-16 of the Company.

P. AMOUNTS IF ANY WHICH IT PROPOSES TO CARRY TO RESERVES.

None - in view of the accumulated losses incurred by the Company.

Q. MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEENT THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT

Ongoing financial crisis in the Company, pending revival of the Company etc.

R. The details in respect of adequacy of internal financial controls with reference to the Financial statements. Internal controls are supported by Internal Audit and Management Reviews. Company ensures existence of adequate internal control through documented policy and procedures to be followed by the executives at various levels. The Management is keen on these issues and initiated various measures such as upgrading IT infrastructure, evaluating & implementing ERP software, web based application and establishing connectivity amongst manufacturing units and branch offices for effective & proactive services and business benefits.

With the objective of improving the systems and removing bottlenecks, systems review is carried out and policies and procedure manuals are amended.

Board periodically reviews the internal controls, Audit Programmes, Financial Results, Recommendations of the Auditors and Management''s Replies to those Recommendations etc.

S. CONSERVATION ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A) Conservation of energy

(i) the steps taken or impact on conservation of Energy : Nil

(ii) the Steps taken by the company for utilizing alternate source of energy :

We have already identified the Administrative Building roof top admeasuring @1500 sq.m for installation of grid connected Solar Roof Top photovoltaic panels. However, due to the financial constraints that your company is facing at present, the scheme is not being implemented.

(iii) the capital investment on energy conservation equipments - NIL

B. Technology Absorption

(i) the efforts made towards technology absorption - NIL

(ii) the benefits derived like product improvement, cost reduction, product development or import substitution : NIL

(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) - NIL

(a) the details of technology imported;

(b) the year of import;

(c) whether the technology been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof; and

(iv) the expenditure incurred on Research and Development.- NIL

T. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK

MANAGEMENT POLICY OF THE COMPANY

KEY THREATS INCLUDE

- Tough competition in Petro sector along with downward movement in prices.

- Availability of cheaper imported chemicals

- High raw material costs

- BIFR has declared the company Sick Company under the provisions of SICA (Special Provisions) Act and pending and delays in revival of the Company had worsened the financial status of the Company led to non-payment of employee dues for over 13 months during the period under review.

- Availability of Anti-dumping support for Phenol and Acetone manufactures at Kochi unit.

- The Company is facing acute working capital shortage which has affected the operations and payment obligations.

- High interest burden, high employees'' remuneration.

SOME RISKS & CONCERNS.

- The man power cost per ton of finished product remains very high.

- Old depreciated plants, requires high maintenance cost.

- Huge investments required for revamp/replacement/modernization of the old plants.

- In view of the fact that as on 31.03.2016 as the Company has been declared as Sick Unit, pending revival of the Company, markets for the finished products, customers credentials have lost.

- Dumping of cheap imports chemical products to the detriment of domestic chemical industry.

- Volatility in the raw material prices mainly Benzene prices.

- Excess manpower of non-operative plants.

U. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES WHICH HAVE BECOME OR CEASED TO BE : HOC Chematurl Ltd. a J.V Subsidiary of one abandoned MDI Project proposed to exit under MCA''s Early Exit Scheme.

V. DETAILS OF CSR POLICY AND ITS IMPLEMENTATION DURING THE YEAR Company right from its inception is cognizant about its social responsibilities. To promote School Education Company is giving need based assistance to the deserving students along with SC/ST students for their school/ graduate education. Company also extends vocational training facilities to the wards of employees in company as well as nearby Engineering/ Management Colleges for enhancing their particular skill/ knowledge. Company also engages ICWA Trainees, CS Trainees and vocational Trainees as a part of their curriculum for imparting practical training by paying stipend.

W. DISCLOSURES PRESCRIBED IN TERMS OF SECTION 67.

X. DEPOSITS: None / Nil.

During the period under review, the Company has not invited or accepted any deposits either from the directors or from shareholders of the Company.

Y. The details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future : NONE

Z. EXTRACT OF ANNUAL RETURN

Form No. MGT -9 EXTRACTS OF ANNUAL RETURN

As on the financial year ended 31.03.2016

I. REGISTRATION AND OTHER DETAILS

i)	CIN	L99999MH1960G0I011895
ii)	Registration Date	12/12/1960
iii)	Name of the Company	HINDUSTAN ORGANIC CHEMICALS LTD.,
iv)	Cateqorv/Sub-Cateqorv of the Company	PSU
v)	Address of the Registered Office and contact Details	P.O. Rasayani, Dist. Raigad PIN 410 207
vi)	Whether Listed Company	Yes
vii)	Name, Address and contact details of Registrar and Share Transfer Agent, if any	M/s. Bigshare Pvt. Ltd.,E-2/3 Ansa Indl. Estate, Saki Vihar Road,Saki Naka, Andheri (E), Mumbai 400 072; Email id.: [e-mail]:

II. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

Sl. No	Name and address of the company	CIN/GIN	Holding/ subsidiary/ Associate	% of shares held	Applicable section
1	HINDUSTAN FLUORO CARBON Ltd.	L25206AP1983PLC004037	Subsidiary	56.43
2	HOC-CHEMATUR LTD.	U24100MH1997PLC112652	Subsidiary	60

III. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY: Manufacturing - C6 -100%

Sl. No.	Name and description of main products/services	NIC Code of the product/service	% of total turnover of the company
1	Phenol		40
2	Acetone		16
3	Dinitrogen Tetroxide (N2O4)		17
4	Hydrogen Peroxide (H2O2)		20

IV. SHAREHOLDING PATTERN:

i. Category- wise Share Holding

Category of shareholders	No. of Shares held at the beginning of the year				No. of Shares held at the end of the year				0/ % Change during the year
	Demat	Physical	Total	% of Total Shares	Demat	Physical	Total	% of Total Shares
A. Promoters
(1) Indian
a) Individual/HUF
b) Central Govt	39481500		39481500	58.78	39481500		39481500	58.78
c) State Govt (s)
d) Bodies Corp.
e) Banks / FI
l) any other
Sub-total (A) (1):-	39481500		39481500	58.78	39481500		39481500	58.78
2) Foreign
a) NRIs - Individuals	22805193		22805193	33.95	818035		818035	1.22
b) Other - Individuals	839632		839632	1.25
c) Bodies Corp.	1100		1100	0.01	1100		1100	0.01
d) Banks / FI
e) Any other
Sub-total (A) (2):-
Total shareholding of Promoter (A) = (A)(1) (A)(2)
B. Public Shareholding
1. Institutions
a) Mutual Funds	11600		11600	0.02	11600		11600	0.02
b) Banks / FI	9900		9900	0.01	3900		3900	0.01
c) Central Govt
d) State Govt(s)
e) Venture Capital Funds
f) Insurance Companies
g) FIIs	1800		1800	0.00	1800		1800	0.00
h) Foreign Venture Capital Funds
i) Others (specify) Trust	159669		159669	0.24	159669		159669	0.24
Sub-total (B)(1):-

2. Non-Institutions
a) Bodies Corp. i) Indian ii) Overseas	3862706		3862706	5.75	3540528		3540528	5.27
b) Individuals
i) Individual shareholders holding nominal share capital upto Rs. 1 lakh					19605511		17833828	26.55
ii) Individual shareholders holding nominal share capital in excess of Rs 1 lakh					3549457		3549457	5.28
Sub-total (B)(2):-	27691600		27691600	41.22	27674300		25903615	38.56
Total Public Shareholding (B)=(B) (1) (B)(2)					27691600		25919917	38.59
C. Shares held by Custodian for GDRs & ADRs
Grand Total (A B C)

ii) Shareholding of Promoters:

Sr. No.	Shareholder’s Name	Shareholding	at the beginning of the year		Share holding at the end of the year
		No. of Shares	% of total Shares of the company	%of Shares Pledged / encumbered to total shares	No. of Shares	% of total Shares of the company	%of Shares Pledged / encumbered to total shares	% change in share holding during the year
1	Promoters	39481500		58.78	39481500			58.78
2
	Total

iii) Change in Promoter''s Shareholding (please specify, if there is no change)

Sr. No.		Shareholding at the beginning of the year		Cumulative Shareholding during the year
		No of shares	% of total shares of the Company	No of shares	% of total shares of the Company
(i)	At the beqinninq of the year	39481500	58.78	39481500	58.78
(ii)	Date wise Increase / Decrease in Promoters Share holding during the year specifying the reasons for increase / decrease (e.g. allotment/ transfer / bonus/ sweat equity etc):	N.A.
p)	At the End of the year	39481500	58.78	39481500	58.78

iv) Shareholding Pattern of top ten shareholders( other than Directors, Promoters and Holders of GDRs and ADRs)

Sr. no.		Shareholding beginning at the of The year		Cumulative Shareholding during the year
	For Each of the Top 10 Shareholders	No. of shares	% of total shares of the company	No. of shares	% of total shares of the company
	At the beginning of the year
	Date wise Increase /Decrease in Share holding during the year specifying the reasons for increase / decrease (e.g. allotment / transfer / bonus / sweat equity etc):
	At the End of the year (or on the date of separation, if separated during the year)

Shareholding of Directors and Key Managerial Personnel:

Sl. No.		Shareholding of at the beginning The year		Cumulative Shareholding during the year
	For Each of the Directors and KMP	No. of shares	% of total shares of the company	No. of shares	% of total shares of the company
	At the beginning of the year: 1) J.N.Suroavanshi, Director (Mktg.) 2) Mrs. S.S.Kulkarni, CS	200 200		200 200	---n.a.--
	Date wise Increase / Decrease in Share holding during the year specifying the reasons for increase / decrease (e.g. allotment / transfer / bonus / sweat equity etc): 1) J.N.Suryavanshi, Director (Mktg.) 2) Mrs.S.S.Kulkarni, CS	N.A.		N.A.

	At the End of the year ( or on the date
	of separation, if separated during	200		200
	the year):	200		200
	1) J.N.Suryavanshi, Director (Mktg.)
	2) Mrs.S.S.Kulkarni, CS

II. INDEBTEDNESS :

Indebtedness of the Company including interest outstanding/accrued but not due for payment : as on 31-03-2016

Rs. in Lakhs

	Secured Loans excluding deposits	Unsecured Loans	Deposits	Total Indebtedness
Indebtedness at the beginning of the financial year
i) Principal Amount	9018.23	31185.00	0.00	40203.23
ii) Interest due but not paid	0.00	6379.90	0.00	6379.90
iii) Interest accrued but not due	29.45	1688.90	0.00	1718.35
Total (i ii iii)	9047.68	39253.80	0.00	48301.48
Change in Indebtedness during the financial year
Addition	240.69	2461.00	0.00	2701.69
Reduction	0.00	0.00	0.00	0.00
Indebtedness at the end of the financial year
i) Principal Amount	9258.92	33646.00	0.00	42904.92
ii) Interest due but not paid	0.00	7379.15	0.00	7379.15
iii) Interest accrued but not due	24.29	1904.06	0.00	1928.35
Total (i ii iii)	9283.21	42929.21	0.00	52212.42

III. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:

A. Remuneration to Whole time Director, Managing Director and/or Manager:

SI.	Particulars of	Name of Whole-time Director/Director				Total Amount
No.	Remuneration	i) Sri V. B. Ramachandran Nair, Chairman and Managing Director (up to 22.02.2016)	ii) Sri S.B. Bhide, Director (Technical) / Acting CMD w.e.f. 25.02.2016	iii) Sri J. N. Suryawanshi, Director (Marketing)	iv) Sri R. Suresh Kumar, Director (Finance) -CFO - up to 29-02-2016	( Rs. in lakhs)
1	Gross Salary a)Salary as per provisions contained in section 17(1) of Income Tax Act, 1961	16.00	19.40	20.09	7.85	63.34
	b) Value of perquisites u/s 17(2) of Income Tax Act, 1961	-	-	-	-	-
	c) Profits in lieu of salary u/s 17(3) of Income Tax Act, 1961	-	-	-	-	-
2	Stock Option	-	-	-	-	-
3	Sweat Equity	-	-	-	-	-
4	Commission - As % of profit - Others, specify	-	-	-	-	-
5	Others - retirement benefits	7.40	2.44	2.51	1.20	13.55
	Total (A)	23.40	21.81	22.60	9.05	76.89
	Ceiling as per the Act	-	-		-	-

b. Remuneration to other Directors:

Sl. No.	Particulars of Remuneration	Name of the Directors				Total Amount
		-	-	-	-
1.	Independent Director - Fee for attending board committee meetings - Commission - Others, please specify	N.A.
	Total (1)
2.	Other Non-Executive Directors - Fee for attending board committee meetings - Commission - Others, please specify
	Total (2)
	Total (B)(1 2)
	Total Managerial Remuneration
	Overall Ceiling as per the Act

B. Remuneration to Key Managerial Personnel other than MD/Manager/WTD:

Sl. No.	Particulars of Remuneration	Key Managerial Personnel
		CEO	Company Secretary Smt. Susheela S. Kulkarni	CFO : Mr. P.O.Luise, DGM(Fin.) appointed on 20-05-2016.	Total Amount ( Rs.in lakhs)
1.	Gross Salary a) Salary as per provisions contained in section 17(1) of Income Tax Act, 1961	-	12.73	16.00	28.73
	b) Value of perquisites u/s 17(2) of Income Tax Act, 1961	-	-	-	-
	c) Profits in lieu of salary u/s 17(3) of Income Tax Act, 1961	-	-	-	-
2.	Stock Option	-	-	--	-
3.	Sweat Equity	-	-	-	-
4.	Commission - As % of profit - Others, specify	-	-	-	-
5.	Others - retirement benefits	-	1.60	2.15	3.75
	Total	-	14.33	18.15	32.48

V. PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCES : None

[as waived off on submission of explanations.]

Type	Section of the Companies Act	Brief Description	Details of Penalty/ Punishment Compounding fees imposed	Authority [RD/NCLT/ COURT]	Appeal made, if any(give details)
A. COMPANY
Penalty
Punishment
Compounding
B. DIRECTORS
Penalty
Punishment
Compounding
C. OTHER OFFICERS IN DEFAULT
Penalty
Punishment
Compounding

Q. ACKNOWLEDGEMENT

Board places on record its gratitude to the members of the Company for their continued support and confidence in the management.

For and on behalf of the Board of Directors of

Hindustan Organic Chemicals Ltd.

Sd/-

Date: 05-08-2016 S. B. Bhide

Place: Rasayani Acting Chairman & Managing Director & Dir. (Tech.)

---

Mar 31, 2015

Dear Members,

The Directors are pleased to present the 54th Annual Report and the Audited Annual Accounts of the Company for the financial year ended 31st March, 2015.

The financial performance of the Company for the year ended March 31, 2015 is summarized below:

(Rs.inLacs)

Year ended Year ended 31/03/2015 31/03/2014

Sales 16719.40 23679.73

Operating Profit/(Loss) (11460.02) (11498.14)

Less: Interest 5217.14 4261.94

Depreciation 879.61 1841.33

Profit/(Loss) before tax (17466.77) (17601.41)



Less: Provision for taxation - -

Less: Prior Period adjustments & Exceptional 4081.99 83.37

Items

Profit/(Loss) after tax & Prior period adjustments, (21548.76) (13798.91)

Provisions and Exceptional Items

[Note: Previous year's figures have been regrouped wherever necessary in the Current year]

In view of continuous incurring of losses during the current year as well as in the previous years, the Board of Directors did not recommend any Dividend for the current year under review.

Status of the Company at BIFR under SIC(SP)Act, 1985 :-

As per BIFR Summary Record of Proceedings of the Hearing of HOCL Case No.501/2014 Held on 22-07-2015 before the Bench, BIFR declared the Company as Sick under Section 3(1)(o) of the Act and appointed State Bank of India as the Operating Agency with directions to prepare a viability study report and revival scheme for the Company, if feasible, keeping in view the provisions of Section 18 of the Act and the guidelines given. BIFR also directed the Company to submit the Draft Rehabilitation Proposal (DRP) with in period of 8 weeks considering the Cut Off Date(COD) as 31-3-2015. BIFR directions also include among other directions, that OA to submit its report thereof before the next date of the hearing (on 4-11-2015) and to examine the DRP on its receipt from the Company etc., [Previous year, as on 31st March, 2015, we have already reported the fact of HOCL as a Sick Unit to BIFR and the company has been registered as a sick company vide BIFR Order No. Case No.501/2014 dated 30.9.2014].

RESULTS OF OPERATIONS :

During the year under review the Company has suffered Net loss of Rs. 215.49 crore, as against the Net Loss of the previous year of Rs. 176.85 crore .

As regards the unit wise performance, the Net Loss of Kochi Unit was Rs.72.58 crore as compared to the previous year's Loss of Rs.69.15 crore. The Rasayani Unit recorded a Net Loss of Rs. 142.90 crore as compared with the previous year's loss of Rs. 107.70 crore.

OPERATIONS :

During the year under report your company achieved a sales turnover of Rs. 16709.40 lacs as against Rs.23679.73 lacs of the previous year.

The high labour cost and high incidence of cost on closed plants at Rasayani Unit are the major concerns. Company decided to operate those plants, which were giving contribution. Your company has continued its cost cutting measures to counter these problems and in order to be competitive and improve performance and profitability.

Due to cash losses, the Company was not able to make payments to raw material suppliers of both the units which resulted in stoppage of raw material supplies and therefore the operations were affected. The Company could however successfully mobilise Rs.150 crore by issuing Redeemable, Non-convertible Unsecured Bonds with the Sovereign Guarantee issued by the Government of India in the month of September 2014 to clear the dues to raw material suppliers and other working capital payments. The company could once again restart the production at Kochi with BPCL resuming the raw material supplies.

PRODUCTION :

Kochi Unit:

During the year your company's Kochi unit could achieve 46476 MTs of production as against the previous year production of 51253 MTs. The capacity utilization for the year was 29.40 % [Installed capacity-158090]

Rasayani Unit:

During the year your company's Rasayani unit could achieve 1227 MTs of production as against the previous year production of 2564 MTs. The capacity utilization for the year was 0.88 %. Capacity utilization is affected due to high fixed cost & finance constrains. [Installed Capacity- 138725]

MARKETING :

The chemical market for various basic chemicals are volatile in the domestic market and in the international market.. There is stiff competition for HOC main products from domestic manufacturers as well importers. During the year 2014-15, the company has achieved the sales turnover of Rs. 150.13 crore ( net of excise duty) only as against Rs. 211.16 crores (net of excise duty) of the previous year(2013-14) and the sales volume during the year 2014-15 was 26474 MTs as against 32184 MTs for the previous year 2013-14.

The projected Sale Turnover & Sale Volume could not be achieved, because of shortage of working capital, easy availability of imported material at cheaper rate, increased price for major raw materials and less margin in selling prices. Even though the company could clear the raw material supplier's dues in the month of October 2014 and restart the operation of Plant at Kochi, due to drastic fall in international crude prices which resulted in sharp decline in the finished product prices as well as main raw material prices, company recovered only contribution on selling of high cost material. This has resulted the stoppage of Kochi Unit operations. This has resulted the loss on the value of inventory holdings as the stock had to be disposed of at market prices.

CURRENT / PRESENT SCENARIO.

The Kochi unit of the Company which was making profits continuously, year after year up to 2011-12 , but during the current year under review, for the third time (in the span of 10 years), the Kochi Unit has incurred a loss to the tune of Rs.72.58 Crores (during the current year). The main reason for the loss suffered by the unit was due to shortage of working capital and withdrawal of Anti-Dumping Duty on the Phenol and Acetone manufactured at Kochi unit, resulting in large scale import of /dumping of those imported products and forcing the company to reduce the prices to match the imported price of Phenol and Acetone. The company has filed review petition & fresh application for Anti-Dumping Duty to the concerned Authority, which will help to improve and better realisation. Due to the pursuance of the Company and also due to change in international scenario, anti-dumping duty has been imposed by GOI.

STATUS OF FUTURE PLANS & TURNAROUND / REVIVAL PLAN

Future Course of Action / Revival Plan:

The Company is declared as sick unit by BIFR in Company's reference and registration with BIFR under Case No. 501/2014. due to 100% erosion of its net worth.

Further, apart from BIFR appointing SBI as Operating Agency with directions to submit the revival plan , the appointed new Consultant M/s. J P S Associates (P) Ltd., have prepared the revival plan and submitted their report to the Board which is under consideration.

HOCL Plans to replace the catalyst of Cumene plant from SPA to Zeolite which will bring down the cost of production.

ENERGY CONSERVATION/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Installed energy efficient H T motor of Siemens in place of old, rewound NGEF makes motor of the same capacity in H2O2 plant. Energy saved due to this modification is 18KW. Future Plans:

Installation of online BOD, COD & TSS analyser in treated effluent discharge line and transmission of these data to Kerala State Pollution Control Board / Central Pollution Control Board server.

Information in accordance with the provisions required to be disclosed under Section 217(2)(e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, Technology Absorption and Foreign Exchange Earning and outgo, are given at Annexure II to this Report.

RESEARCH & DEVELOPMENT

After initial trial runs on pilot scale the 'In-house' developed vapour phase continuous process for ISRO's specific grade of Kerosene (Isrosene) was fine tuned. A model developed on laboratory scale was also verified on pilot plant scale. Regular runs with optimized parameters in 'scaled down version' of HOC's commercial plant were successfully completed. The product quality from these runs has been re-affirmed and the capacity of the plant has also been established, based on these runs. The technology is now ready for implementation in HOC's available commercial plant. In this regard meeting with ISRO was held. The detailed proposal was sent to ISRO. Company's further contribution in IPR field is maintained and grant of three nos. of Indian patents has been obtained during this year.

HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS:

The Company has recognized the importance of Human Resource since its inception. The Company continues to recognize that human asset is very much valuable for the continual improvements in the performance of the Company, particularly in the context of competition all around. Since it is very vital resource, Company is upgrading the skills of their employees by systematically identifying training need of employees. The position relating to SC/ST/Women personnel in the Company is given in Annexure - III to the Directors' Report.

II. Training:

During the Financial Year 2014-15 at Kochi Unit, training was imparted to employees based on operational requirement/needs identifications with the allocated resources to enhance Soft Skills, Technical and Managerial Skills. Due importance was given and constant efforts were made to impart Health, Safety and Environment aspects considering the nature of hazards in our Unit. During the year under review, company has organized training programmes both Internal/External covering 505 mandays with the help of Internal/External Experts. Specific user training in functional module of ERP was also imparted to the employees so as to make the SAP system more users friendly. Regular refresher course in Safety and Environmental Management were organized. Apart from employees training our Company has extended the facilities and resources to students coming from different Engineering Colleges, Management Institutions to enhance their practical knowledge/for experiential learning. Company also engages Graduate/Technical/Trade/Vocational Apprentices to undergo Apprenticeship Training in different discipline under the Apprentices Act 1961.

III. Industrial Relations :

Industrial Relation climate in HOC Kochi Unit during the year 2014-15 was satisfactory.

IV. Suggestion Scheme:

The Suggestion Scheme is in existence in HOCL, Kochi Unit. All employees and Company Trainees are eligible to participate in this scheme. The Suggestions received from the employees are evaluated by a Suggestion Committee and the selected suggestions are awarded with Cash Prizes ranging from Rs.100/- to Rs.5000/-.

PARTICULARS OF EMPLOYEES - INFORMATION REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956 .

No employee of the Company has drawn the remuneration during the year 2014-15 or any part thereof, in excess of the limits specified under the Company's (Particulars of Employees) Rules 1975.

Accordingly particulars of employees' remuneration prescribed u/sec 217 (2A) of the Companies Act, 1956 are not furnished.

VIGILANCE

The Vigilance Department, headed by Chief Vigilance Officer, appointed by Government of India on deputation, has three main functional officers, one each at Rasayani (Raigad) in Maharashtra, and at Ambalamugal (Kochi) in Kerala and third at Corporate office, CBD Belapur, Navi Mumbai. Keeping in view of the Principles of Corporate Governance, the main focus of the Vigilance Department has been to help the sincere, dedicated and honest personnel working in the Organization to discharge their duties effectively and efficiently so that the target of optimum turnover and profitability are achieved in a transparent manner. More emphasis is given in improving the functioning of all sections and maintaining transparency.

The Vigilance department takes appropriate and timely action in respect of complaints received. There is a comprehensive complaint handling policy and prescribed punitive action is duly suggested, after conducting fair and impartial investigation/enquiry, where ever required. The Annual Property Returns of the officers are periodically scrutinized and inspection of departmental activities are undertaken to detect deviations, if any, and suggest corrective measures. Vigilance Awareness Programmes, as per guidelines issued by the CVC, are observed and awareness sessions are conducted for the personnel regarding vigilance related matters as well as in respect of CDA Rules, RTI Act, PIDPI (Whistle Blowers Act) etc. The vigilance department has been instrumental in updating the existing manuals and policies i.e. the Purchase Policy, the Works Policy, the Marketing Manual, the Vigilance manual etc., so that the laid down procedures, policies, rules, regulations etc., of the Company and that of Central Vigilance Commission are duly followed.

The Vigilance Department maintains close interaction with CVC, CBI and other Government agencies. The Vigilance wing has been sincerely and consistently helping all personnel of the Organization in improving their efficiency and effectiveness and, in turn, achieving the set goals of the Organization.

CORPORATE SOCIAL RESPONSIBILITY

Company right from its inception is conscious about its social responsibilities. To fulfill this, Company has provided basic civic amenities to the neighboring villages, rendering assistance to the neighborhood in different forms viz. financial assistance, drinking water supply, medicines etc.

To promote School Education, Company is giving scholarship to X and XII standard students. Company extends need based assistance to the deserving SC/ST students in the nearby villages for their graduate education.

Company also extends vocational training facilities to the wards of employees in nearby Engineering/ Management Colleges for enhancing their practical knowledge. Company also engages ICWA Trainees, CS Trainees and Vocational Trainees, as a part of their curriculum for imparting practical training.

HEALTH, ENVIRONMENT, FIRE & SAFETY

Health :

* Physical Check-up, the Special Certificate of Fitness in Form No. 23 and ascertaining Health Status in Form No. 7 of all employees have been carried out by the Certifying Surgeon for the year 2013.

* Periodic Medical Check-up and regular monitoring of health records of all employees was done. Various health awareness training programmes were carried out by specialist doctors for the benefit of employees.

Environment:

* Our Laboratory has participated in the Proficiency Testing conducted by CPCB for the laboratories recognized under E.P. Act and other laboratories.

* To ascertain that the level of pollutants are maintained within acceptable limits, ambient air quality monitoring, Stack emissions, Noise monitoring, workplace monitoring & analysis of inorganic and organic chemicals is being carried out a various locations in plants and in other locations.

* Testing of Flammable gases for issue of hot permit under safety policy especially for plants held for disposal under idle assets #1.

Security System :

Kochi Unit of HOCL has been classified as 'MAJOR ACCIDENT HAZARD INSTALLATION' by the Govt. of Kerala. The security requirements are met from the agencies sponsored by the Director General (re-settlement), Ministry of Defense, Govt. of India. Security Guards are posted in the identified areas inside the Factory premises and also in Township round the clock. At present the strength of the security personnel is as under: Security Officer : 01; Security Supervisor : 03; Security Guards: 65 In view of the increased threat perception in Kochi, the Unit has been advised to take suitable measures for upgrading the security by the concerned authorities. Action is being taken to install CCTV Surveillance system.

IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY .

During the year under report, your Company continued its intensive and extensive efforts for progressive use of the official language. To promote Hindi as official language is day to day working in line with the Government policies. In Compliance with Section 3(3) of the Official Language Act, 1963 and Official Language Rules 1976 framed there under, Company has implemented various measures effectively given in annual program during the year under review. All documents coming under Section 3(3) like Resolutions, General Orders, Rules, Notifications, Reports Press Communiques, Contracts, Agreements, Licenses Permits, Tender Notices, Forms of Tender, Reports/ Papers submitted to the Parliament & Company letters like Part-I Orders, Part-II Orders, Circulars, transfer etc. were issued bilingually. The all Hindi Letters received are being replied in Hindi to comply with Rule 5 of Official Language Rule 1976. All name plates, sign-boards, visiting cards, Demi Official letter heads etc. are prepared in bilingual form. Our Company participated in all the programs organized by Mumbai town Official Language Implementation Committee. Hindi Workshops were conducted in every quarter to impart training in the working knowledge of Hindi to Officers as well as employees. The Official Language implementation Committee Meetings were held at both the Units to review the progressive use of Hindi for the Official purpose. Hindi Fortnight was organized at both Rasayani and Kochi Units and in the Corporate Office. During this period various competitions were organized & large number of Employees participated in this competitions. The other activities of the Company which was organized through the medium of Official Language was Vigilance Week, Security Week and Environment Day during the year. For the progressive use of Information Technology through medium of Hindi all the Computers are being loaded with Unicode.

Kochi Unit received Second prize for the best implementation of Official Language from Kochi Town Official Language Implementation Committee.

* Web site of the Company is prepared to Hindi also www.hocl.hindi.gov.in

* To improve the Hindi word power of the employees, every day one bilingual word being exhibited in the presto Board kept in the reception and the list of the same is being circulated in the end of the month.

* To comply with the Official Language Policy of the Government, Workshops on Official Language are regularly conducted for the employees who possesses working knowledge in Hindi so as to encourage them to use Hindi in their day to day office work. 7 Workshops were conducted during the period under the report.

* Out of the total amount spent for purchase of books for library, nearly 50% of the amount was spent for the purchase of Hindi Books. Hindi Newspaper and magazines are also subscribed in the Unit.

* The Official Language implementation Committee has been constituted for review of the OL implementation work in the Unit and the OLIC meets regularly.

Every year effort are made to fulfill the targets set in the Annual program issued by Department of Official Language Ministry of Home Affairs.

ISO CERTIFICATION :

HOCL Kochi unit is an ISO 9001: 2008 (Quality Management System) and ISO 14001: 2004 (Environmental Management System) certified company. The existing certificate for ISO 9001 & ISO 14001 is valid up to 2014.

BVCI Conducted routine surveillance audit periodically for both the systems.

INSURANCE

All properties and insurable interest of the Company including building, plant and machinery and goods are adequately insured. As required under Public liability Insurance Act, 1991 the company has taken necessary insurance cover.

FIXED DEPOSITS

With regard to Fixed Deposits, nothing is outstanding towards FDR for the Financial Year 2014-15.

DEPOSITORY SYSTEM

As the members are aware your company's shares are tradable compulsorily in electronic form and your Company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the enormous advantages offered by the Depository system, Members are requested to avail the facility of dematerialisation of the Company's shares on either of the depositories as aforesaid. E-Voting facilities are available at the depositories and in respect of 54th AGM, Company has provided the e-voting facilities for the Shareholders of the Company at CDSL

MANAGEMENT DISCUSSION AND ANALYSIS REPORT.

In accordance with the listing agreement, the Management Discussion and Analysis Report is annexed hereto in Annexure V and forms part of the Directors' Report. CORPORATE GOVERNANCE

The Company has complied with the various requirements of Corporate Governance. The details in this regard form part of this report in Annexure VI.

RESPONSIBILITY STATEMENT

The Directors confirm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) that they 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 or loss of the company for that period;

c) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the New Companies Act, 2013 & Companies Act, 1956, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) that they have prepared the annual accounts on a going concern basis.

Subsidiary Companies :

HINDUSTAN FLUOROCARBONS LIMITED [HFL] : (Subsidiary) .

OPERATION AND OVERALL PRODUCTION AND MARKETING PERFORMANCE:

During the year, HFL has made Net loss of Rs.377.46 lacs from operations as against the net loss of Rs. 2482.47 lacs of the previous year. During the year, the sales turnover (net) was Rs.2915.07 lacs as against Rs.2788.92 lacs in the previous year. This is mainly due to employee benefits against wage revision, Decrease in sales realization of main product PTFE and discontinuation of CDM Project in international market. During the year under report production of PTFE was 107 Metric Tons as against 184 Metric Tons in the previous year. During the year, 726.58 Metric Tons of CFM-22 was sold in the market against 555.17 Metric Tons in the previous year and balance quantity was used as feed stock to manufacture various products including Fluoro Specialty Chemicals. Accordingly, during the year 45.80 Metric Tons of Tetra Fluoro Etylene (TFE) was used to manufacture Telomere. Quality of all company's products continued to be well accepted by our customers. Company has achieved 88% capacity utilization as against 86% in the previous financial year. In spite of better physical performance, financial performance was badly affected due to the reasons mentioned above.

Considering the Company's financial health, during the year on the recommendations of the BODs, though your Company has put up its proposals to (its Subsidiary,) HFL, demanding for the repayment of part of secured loan amount fallen due for payment (to HOCL) out of the proceeds of land sale (HFL Land sold to CIEPET), HFL had expressed its inability to repay to HOCL amount overdue stating that the funds not available due to Capex Programme.

CLEAN DEVELOPMENT MECHANISM (CDM) PROJECT:

In absence of buyers from European Union, CER prices was drastically come down, hence company is not generating CERs.

HOC CHEMATUR LTD. [Subsidiary JV)- Abandoned Project :

The subsidiary Co. HOC Chematur Ltd. existing only on records as it was incorporated as a Public Ltd. Co. under the Companies ACT and is subject to audit both by the statutory auditors appointed by the C&AG, and by the Govt. Audit, The statement of Profit & Loss is approved and audited as prescribed under the provisions of Companies Act, 2013 and are e-filed to the MCA/ROA authorities.

The Statement Pursuant to Sec. 129(3) of the Companies Act, 1956 is given in Annexure I & Annexure IA in respect of HOC Chematur Ltd.

Form AOC-I

Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014 , Form AOC-I is given in Annexure IB

AUDITORS

In terms of provisions of Section 619(2) of the Companies Act,1956, the Comptroller & Auditor General of India, under its letter No.CA. V/COY/CENTRAL GOVT,HOCL(2)/225 dated 30/7/2014 has appointed M/s FORD RHODES PARKS & CO, Chartered Accountants, Mumbai as Auditors of the Company to audit the accounts of the Rasayani unit and to audit the consolidated accounts of the company. Vide CAG under its letter No.CA. V/COY/CENTRAL GOVT. HOCL (2)/225 dated 30/7/2014 has appointed M/s AYYAR & CHERIAN Chartered Accountants, Cochin as Branch Auditors to audit the accounts of Cochin unit for the year ended 31st March, 2015.

The remarks of the Board of Directors on the Auditors' Report to the members are furnished in Annexure IV.

The report of the Comptroller & Auditor General of India under section 619(4) of the Companies Act, 1956, on the Accounts of the Company for 2013-14 is annexed to the Statutory Auditors' Report in the Annual Report.

Pursuant to directions from the Ministry of Company Affairs for appointment of Cost Auditors, Board of Directors of the company appointed M/s V.J.Talati & Co. as the Cost Auditors of Rasayani Unit and also as Lead Auditors for the Year 2014-2015 for cost audit of Company's Sulphuric Acid, Aniline, Formaldehyde, Caustic Soda, Nitro Benzene products (of Rasayani unit) and M/s Panikar & Company as Cost Auditors of Kochi Unit for the year 2014-15 for Kochi Unit products viz. Phenol, Acetone & Polypropylene products.

DIRECTORS

During the Financial Year 2014-15, GOI has appointed also Shri. Rajiv Yadav, Additional Secretary & Financial Advisor in the Ministry of Chemicals & Fertilizers as part-time Government Nominee Director in place of Dr. V.K. Subburaj, SS&FA, on the Board of HOCL, vide GOI Order No. 51/11/95-Ch-NI-(Vol.N) dated 23rd June, 2014.

During the year 2015, in the month of May, 2015 (21-5-2015, the tenure of one Independent Director, Dr. N.J. Gaikwad from Nagpur, ( Non official part time Director on the Board of HOCL ) on the Board of the Company was ended on 21st May, 2015.

In terms of Article 76(4) of the Articles of the Association of the Company, as on date of this Report ( 11-8-2015) the Government Nominee Directors, viz. Shri Rajiv Yadav, Special Secretary & Financial Advisor and Dr. A.J.V.Prasad, Joint Secretary, will retire at this 54th AGM in 2015 and are eligible for reappointment. Company is awaiting the necessary orders of the Government regarding reappointment of the said two Govt. Nominee Directors.

ACKNOWLEDGMENT

Your Directors gratefully acknowledge the valuable guidance, support and directions given by the Government of India. Your Directors also gratefully acknowledge the support and co-operation extended by the State Governments, by the valued and esteemed customers, shareholders, suppliers, bankers, Statutory/Internal/Cost and Tax Auditors, Bondholders, and Investors at large.

Your Directors place on record their appreciation for the whole hearted efforts and contribution from all the employees and also acknowledge the support and co-operation of the entire Workers' Unions and Employees' Unions and their members for the smooth functioning of the Company's operations.

For and on behalf of the Board of Directors of Hindustan Organic Chemicals Limited

Sd/- Place : Mumbai V.B. Ramachandran Nair Date 11 / 08 / 2015 Chairman & Managing Director

---

Mar 31, 2014

Dear Shareholders

The Directors are pleased to present the 53rd Annual Report and the Audited Annual Accounts of the Company for the financial year ended 31st March, 2014.

The financial performance of the Company for the year ended March 31, 2014 is summarized below:

(Rs. in Lacs)

Year ended Year ended 31/03/2014 31/03/2013

Sales 23679.73 62419.40

Operating Profit/(Loss) (11498.14) (8411.98)

Less: Interest 4261.94 2824.15

Depreciation 1841.33 2232.95

Profit/(Loss) before tax (17601.41) (13469.08)

Less: Provision for taxation - -

Less: Prior Period adjustments & Exceptional Items 83.37 (329.83)

Profit/(Loss) after tax & Prior period (17685.28) (13798.91) adjustments, Provisions and Exceptional Items.

[Note: Previous years figures have been regrouped wherever necessary in the Current year]

In view of continuous incurring of losses during the current year as well as in the previous years, the Board of Directors did not recommend any Dividend for the current year under review.

Reporting to BIFR under SIC(SP)Act, 1985 :-

As on 31st March, 2014, we have already reported the fact of HOCL as a Sick Unit to BIFR and have submitted required information and details in Form AA and are awaiting the Registration No. for the same on Registration of HOCL as a Sick Company.

RESULTS OF OPERATIONS :

During the year under review the Company has suffered Net loss of Rs. 176.85 crores, as against the Net Loss of the previous year of Rs. 137.99 crores.

As regards the unit wise performance, the Net Loss of Kochi Unit was Rs.69.15 crores as compared to the previous year''s loss of Rs.36.05 crores. The Rasayani Unit recorded a Net Loss of Rs. 107.70 crores as compared with the previous year''s loss of Rs. 101.94 crores.

OPERATIONS :

During the year under report your company''s Rasayani unit achieved a sales turnover of 3142MTs valuing Rs. 1254 lacs as against 55562 MTs valuing Rs. 16164 lacs registering a 94 % decrease in sales.

During the year under report your company''s Kochi unit achieved a sales turnover of 29042 MTs valuing Rs. 19862 Lacs as against 55242 MTs valuing Rs. 39337 Lacs of the previous year.

With the production of 53817 MTs during the year 2013-14 as against the production of 150979 MTs in 2012-13, your company could achieve an overall capacity utilization of 18.13% during the year. Your company has recorded the sale of 32184 MTs during the year (previous year 110804 MTs) valuing Rs21116 lacs (previous year Rs. 55501 lacs). The high labour cost and high incidence of cost on closed plants at Rasayani Unit are the major concerns. Company decided to operate those plants, which were giving contribution. Your company has continued its cost cutting measures to counter these problems and in order to be competitive and improve performance and profitability.

Due to cash losses, the Company was not able to make payments to raw material suppliers of both the units which resulted in stoppage of raw material supplies and therefore the operations were affected.

PRODUCTION :

Kochi Unit:

During the year your company''s Kochi unit could achieve 51253 MTs of production as against the previous year production of 100003 MTs. The capacity utilization for the year was 32.42 %

Rasayani Unit:

During the year your company''s Rasayani unit could achieve 2564 MTs of production as against the previous year production of 50976 MTs. The capacity utilization for the year was 1.85 %. Capacity utilization is affected due to high fixed cost & finance constrains.

MARKETING :

The chemical market for various basic chemicals are volatile and most competitive. There is stiff competition for HOC main products which were available at cheaper rate from domestic manufacturers, as well as importers, considering the logistic advantage to the importers & domestic manufacturers and increase in raw material prices. During the year 2013-14, the company has achieved the sales turnover of Rs. 211.16 crore (net of excise duty) only as against Rs. 555.01 crores (net of excise duty) of the previous year (2012-13) and the sales volume during the year 2013-14 was 32184 MTs as against 1,10,804 MTs for the previous year 2012-13. The projected Sale Turnover & Sale Volume could not be achieved, because of funds constraint, cheaper importer''s selling prices, increase in major raw material prices and less margin in selling prices. During the last quarter of the financial year there was a good demand for the Company''s products, but Company could not run all the plants continuously due non availability of working capital.

CURRENT / PRESENT SCENARIO.

The Kochi unit of the Company which was making profits continuously, year after year for the last (gap of) 10 years, but during the current year under review, for the second time (in the span of 10 years), the Kochi Unit has incurred a loss to the tune of Rs.69.15 Crores. The main reason for the loss suffered by the unit was due to withdrawal of Anti-Dumping Duty on the Phenol and Acetone manufactured at Kochi unit, resulting in large scale import of /dumping of those imported products and forcing the company to reduce the prices to match the imported price of Phenol and Acetone. The raw material cost also went up drastically which increased the cost of production. The company has filed review petition & fresh application for Anti-Dumping Duty to the concerned Authority, which will help to improve the better realisation. Due to the pursuance of the Company and also due to change in international scenario, anti-dumping duty has been imposed by GOI.

STATUS OF OPERATIONS AND FUTURE PLANS & TURNAROUND / REVIVAL PLAN

Status of Operations -

During the year, the operations of the Company, both at Kochi Unit and Rasayani Unit, suffered badly due to erosion of working capital.

As per the decision of the Board, several cost cutting measures were implemented. The Company had also introduced VRS during the year to reduce the manpower cost. However due to shortage of funds all the employees who had opted VRS could not be relieved during the financial year 2013-14.

The Company had entrusted FEDO to conduct a revival study .

The Company had done necessary planning to restore its operations to normal level by raising working capital through issue of Bonds of Rs. 150 Crore, backed by Government of India Guarantee. The Company had already received Government of India Guarantee for raising Rs. 150 Crore through Bond issue.

Further Tripartite Agreement will be executed between the Company, GOI and Trustee for this bond

Future Course of Action / Revival Plan:

The Company is referred to BIFR for restructuring due to 100% erosion of its net worth. The Company had already appointed M/s FEDO as consultant for preparing suitable revival plan for long term sustainability of the Company.

HOCL plans to lease about 60 acres of land at Rasayani to M/s CONCOR to set up a multi model logistic park and have a revenue sharing arrangement also. With the completion of CNA plant refurbishment HOCL proposes to meet the requirement of ISRO for supply of N2O4.

HOCL Plans to replace the catalyst of Cumene plant from SPA to Zeolite which will bring down the cost of production.

ENERGY CONSERVATION/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions required to be disclosed under Section 134(3m) of the Companies Act, 2013 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules thereon, regarding conservation of energy, Technology Absorption and Foreign Exchange Earning and outgo, are given at Annexure II to this Report.

RESEARCH & DEVELOPMENT

After initial trial runs on pilot scale the ''In-house'' developed vapour phase continuous process for ISRO''s specific grade of Kerosene (Isrosene) was fine tuned. A model developed on laboratory scale was also verified on pilot plant scale. Regular runs with optimized parameters in ''scaled down version'' of HOC''s commercial plant were successfully completed. The product quality from these runs has been re-affirmed and the capacity of the plant has also been established, based on these runs. The technology is now ready for implementation in HOC''s available commercial plant. Company''s further contribution in IPR field is maintained and grant of three nos. of Indian patents has been obtained during this year.

HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS:

I. The Company has recognized the importance of Human Resource since its inception. The Company continues to recognize that human asset is very much valuable for the continual improvements in the performance of the Company, particularly in the context of competition all around. Since it is very vital resource, Company is upgrading the skills of their employees by systematically identifying training need of employees. The position relating to SC/ST/Women personnel in the Company is given in Annexure - III to the Directors'' Report.

II. Training:

Rasayani Unit:

During the Financial Year 2013-14 total 65 in-house training programmes were conducted in Company''s Training Centre. Total man-days trained are 976.5. Further, under Value Addition Programme (VAP) total 13 employees were trained against the assigned objective of atleast 8 front line supervisors to be trained under VAP. Total five technical presentations were organized and conducted to create operational awareness about working systems against the assigned objective of atleast four no. of presentations to be conducted during the year.

Training Section Team of the Company had made presentations on behalf of HOCL in the Best HR Practises Competition conducted by National Institute of Personnel Management, Raigad Chapter, Western Region and won the cash prize with certificate and trophy.

Kochi Unit:

Training was imparted to employees based on operational requirement/needs identifications with the allocated resources to enhance Soft Skills, Technical and Managerial Skills. Due importance was given and constant efforts were made to impart Health, Safety and Environment aspects considering the nature of hazards in the Unit. During 2012-13 the unit had organized training programmes both Internal/External covering 505 mandays with the help of Internal/ External Experts. Specific user training in functional module of ERP was also imparted to the employees so as to make the SAP system more users friendly. Regular refresher course in Safety and Environmental Management were organized.

Apart from employees training the Company had extended the facilities and resources to students coming from different Engineering Colleges, Management Institutions to enhance their practical knowledge/for experiential learning. Company also engages Graduate / Technical / Trade / Vocational Apprentices to undergo Apprenticeship Training in different discipline under the Apprentices Act 1961.

III. Industrial Relations :

Industrial Relation climate in the Company during the year 2013-14 also continued to remain cordial on all fronts.

IV. Suggestion Scheme:

The Suggestion Scheme is in existence in HOCL, Kochi Unit. All employees and Company Trainees are eligible to participate in this scheme. The Suggestions received from the employees are evaluated by a Suggestion Committee and the selected suggestions are awarded with Cash Prizes ranging from Rs.100/- to Rs.5000/-.

PARTICULARS OF EMPLOYEES - INFORMATION REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956.

No employee of the Company has drawn the remuneration during the year 2013-14 or any part thereof, in excess of the limits specified under the Company''s (Particulars of Employees) Rules 1975.

Accordingly particulars of employees'' remuneration prescribed u/sec 217 (2A) of the Companies Act, 1956 are not furnished.

VIGILANCE

The Vigilance Department, headed by Chief Vigilance Officer, appointed by Government of India on deputation, has three main functional officers, one each at Rasayani (Raigad) in Maharashtra, and at Ambalamugal (Kochi) in Kerala and third at Corporate office, CBD Belapur, Navi Mumbai. Keeping in view of the Principles of Corporate Governance, the main focus of the Vigilance Department has been to help the sincere, dedicated and honest personnel working in the Organization to discharge their duties effectively and efficiently so that the target of optimum turnover and profitability are achieved in a transparent manner. More emphasis is given in improving the functioning of all sections and maintaining transparency.

The Vigilance department takes appropriate and timely action in respect of complaints received. There is a comprehensive complaint handling policy and prescribed punitive action is duly suggested, after conducting fair and impartial investigation/enquiry, where ever required. The Annual Property Returns of the officers are periodically scrutinized and inspection of departmental activities are undertaken to detect deviations, if any, and suggest corrective measures. Vigilance Awareness Programmes, as per guidelines issued by the CVC, are observed and awareness sessions are conducted for the personnel regarding vigilance related matters as well as in respect of CDA Rules, RTI Act, PIDPI (Whistle Blowers Act) etc. The vigilance department has been instrumental in updating the existing manuals and policies i.e. the Purchase Policy, the Works Policy, the Marketing Manual, the Vigilance manual etc., so that the laid down procedures, policies, rules, regulations etc., of the Company and that of Central Vigilance Commission are duly followed.

The Vigilance Department maintains close interaction with CVC, CBI and other Government agencies. The Vigilance wing has been sincerely and consistently helping all personnel of the Organization in improving their efficiency and effectiveness and, in turn, achieving the set goals of the Organization.

CORPORATE SOCIAL RESPONSIBILITY

Company right from its inception is conscious about its social responsibilities. To fulfill this, Company has provided basic civic amenities to the neighboring villages, rendering assistance to the neighborhood in different forms viz. financial assistance, drinking water supply, medicines etc.

To promote School Education, Company is giving scholarship to X and XII standard students. Company extends need based assistance to the deserving SC/ST students in the nearby villages for their graduate education.

Company also extends vocational training facilities to the wards of employees in nearby Engineering/ Management Colleges for enhancing their practical knowledge. Company also engages ICWA Trainees, CS Trainees, and Vocational Trainees, as a part of their curriculum for imparting practical training.

HEALTH, ENVIRONMENT, FIRE & SAFETY

Health :

* Physical Check-up, the Special Certificate of Fitness in Form No. 23 and ascertaining Health Status in Form No. 7 of all employees have been carried out by the Certifying Surgeon for the year 2013.

* Periodic Medical Check-up and regular monitoring of health records of all employees was done. Various health awareness training programmes were carried out by specialist doctors for the benefit of employees.

Environment:

* Revenue generation by Health and Hygiene department giving analytical support and technical support to nearby industries, as well as miscellaneous income amounting to total Rs. 5.6 lakhs.

* Our Laboratory has participated in the Proficiency Testing conducted by CPCB for the laboratories recognized under E.P. Act and other laboratories. It has undertaken outside samples analysis for physical and chemical parametres on chargeable basis generating a revenue to the tune of R. 22,000/-.

* To ascertain that the level of pollutants are maintained within acceptable limits, ambient air quality monitoring, Stack emissions, Noise monitoring, workplace monitoring & analysis of inorganic and organic chemicals is being carried out at various locations in plants and in other locations.

* Testing of Flammable gases for issue of hot permit under safety policy especially for plants held for disposal under idle assets was carried out.

Security System :

Kochi Unit of HOCL has been classified as ''MAJOR ACCIDENT HAZARD INSTALLATION'' by the Govt. of Kerala. The security requirements are met from the agencies sponsored by the Director General (re-settlement), Ministry of Defense, Govt. of India. Security Guards are posted in the identified areas inside the Factory premises and also in Township round the clock. At present the strength of the security personnel is as under:

Security Officer : 01 Security Supervisor : 03 Security Guards : 65

In view of the increased threat perception in Kochi, the Unit has been advised to take suitable measures for upgrading the security by the concerned authorities. Action is being taken to install CCTV Surveillance system. HOCL being a hazardous installation, National Security Guard (NSG) has conducted reconnaissance in this Unit form 7/11/2013 to 9/11/2013.

IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY .

Rasayani Unit:

During the year under report, your Company continued its intensive and extensive efforts for progressive use of the official language. To promote Hindi as official language in day to day working in line with the Government policies. In Compliance with Section 3(3) of the Official Language Act, 1963 and Official Language Rules 1976 framed there under, Company has implemented various measures effectively given in annual programme for 2013-14. All documents coming under Section 3(3) like Resolutions, General Orders, Rules, Notifications, Reports Press Communiques, Contracts, Agreements, Licences Permits, Tender Notices, Forms of Tender, Reports/ Papers submitted to the Parliament & Company letters like Part-I Orders, Part-II Orders, Circulars, transfer etc. were issued bilingually. The all Hindi Letters received are being replied in Hindi to comply with Rule 5 of Official Language Rule 1976. All name plates, sign-baords, visiting cards, Demi Official letter heads etc. are prepared in bilingual form. Our Company participated in all the programmes organized by Mumbai town Official Language Implementation Committee. Hindi Workshop were conducted in every quarter to impart training in the working knowledge of Hindi to Officers as well as employees. The Official Language implementation Committee Meetings were held at both the Units to review the progressive use of Hindi for the Official purpose. Hindi Fortnight was organized at both Rasayani and Kochi Units and in the Corporate Office in Mumbai from 14th September, 2013 to 28th September, 2013. Hindi Day celeberated on 14th September, 2013. During this period 11 various competitions were organized & large number of Employees participated in this competitions. To fulfill the target set in the Annual Programme issued by Department of Official Language, Ministry of Home Affairs CMD has himself participated in the Hindi Salahkar Committee Meeting of Chemical & Fertilizers Ministry in the year 2013. The other activities of the Company which was organized through the medium of Official Language was Vigilance Week, Security Week and Environment Day during the year. For the progressive use of Information Technology through medium of Hindi all the Computers are being loaded with Unicode.

Kochi Unit:

Kochi Unit received Second prize for the best implementation of Official Language from Kochi Town Official Language Implementation Committee.

1) All documents coming Under Sec. 3(3) of the Official Language Act, 1963 are issued in bilingual form.

2) The Hindi letters received are being replied in Hindi to comply with the rule 5 of Official Language Rules 1976. All nameplates, Sign Board, Visiting Cards, Demi-Official letters heads are prepared is bilingual form.

3) Web site of the Company is prepared in Hindi also www.hocl.hindi.gov.in

4) To improve the Hindi word power of the employees, every day one bilingual word being exhibited in the presto Board kept in the reception and the list of the same is being circulated in the end of the month.

5) Cash Incentive Scheme for doing original work in Hindi is existing in the unit and during September 2012 to August 2013, 15 employees have received the incentive.

6) To comply with the Official Language Policy of the Government, Workshops on Official Language are regularly conducted for the employees who possesses working knowledge in Hindi so as to encourage them to use Hindi in their day to day office work. 7 Nos. Workshops were conducted during the period under the report.

7) Out of the total amount spent for purchase of books for library, nearly 50% of the amount was spent for the purchase of Hindi Books. Hindi Newspaper and magazines are also subscribed in the Unit.

8) The Official Language implementation Committee has been constituted for review of the OL implementation work in the Unit and the OLIC meets regularly.

Every year effort are made to fulfill the targets set in the Annual programme issued by Department of Official Language Ministry of Home Affairs.

ISO CERTIFICATION :

HOCL, Rasayani Unit, has been awarded ISO-9001:2008 certificate on 11.01.2011. This certificate has been awarded by M/s Bureau Veritas Certification (India) Pvt. Ltd. and is valid till 9/02/2017.

HOCL Kochi unit is having ISO 9001: 2008 (Quality Management System) and ISO 14001: 2004 (Environmental Management System) Certification. The existing certificate for ISO 9001 & ISO 14001 is valid up to 2017.

BVCI Conducted routine surveillance and recertification audits periodically for both the systems.

INSURANCE

All properties and insurable interest of the Company including building, plant and machinery and goods are adequately insured. As required under Public liability Insurance Act, 1991 the company has taken necessary insurance cover.

FIXED DEPOSITS

With regard to Fixed Deposits, nothing is outstanding towards FDR for the Financial Year 2013-14.

DEPOSITORY SYSTEM

As the members are aware your company''s shares are tradable compulsorily in electronic form and your Company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the enormous advantages offered by the Depository system, Members are requested to avail the facility of dematerialisation of the Company''s shares on either of the depositories as aforesaid.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with the listing agreement, the Management Discussion and Analysis Report is annexed hereto in Annexure V and forms part of the Directors'' Report. CORPORATE GOVERNANCE

The Company has complied with the various requirements of Corporate Governance. The details in this regard form part of this report in Annexure VI.

RESPONSIBILITY STATEMENT

The Directors confirm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) that they 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 or loss of the company for that period;

c) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the New Companies Act, 2013 & Companies Act, 1956, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) that they have prepared the annual accounts on a going concern basis.

HINDUSTAN FLUOROCARBONS LIMITED : (Subsidiary)

OPERATION AND OVERALL PRODUCTION AND MARKETING PERFORMANCE:

During the year, the sales turnover (net) was Rs.2788.92 lacs as against Rs.4080.31 lacs in the previous year. During the year under report production of PTFE was 183.96 Metric Tons as against 154.78 Metric Tons in the previous year. During the year, 555.17 Metric Tons of CFM-22 was sold in the market against 244.73 Metric Tons in the previous year and balance quantity was used as feedstock to manufacture various products including Fluoro Specialty Chemicals. Accordingly, during the year 22.38 Metric Tons of Tetra Fluoro Etylene (TFE) was used to manufacture TFE-ETHER. Quality of all company''s products continued to be well accepted by our customers. Company has achieved 86% capacity utilization for CFM-22 for this year.

The Statement Pursuant to provision under Sec. 129(3) of the Companies Act, 2013 is given in Annexure I.

AUDITORS

In terms of provisions of Section 619(2) of the Companies Act,1956, the Comptroller & Auditor General of India, under its letter No.CA. V/COY/CENTRAL GOVT,HOCL(2)/225 dated 8/8/2013 has appointed M/s FORD RHODES PARKS & CO, Chartered Accountants, Mumbai as Auditors of the Company to audit the accounts of the Rasayani unit and to audit the consolidated accounts of the company. Vide CAG under its letter No.CA. V/COY/CENTRAL GOVT.HOCL (2)/225 dated 8/8/2013 has appointed M/s SASI VIJAYAN & RAJAN, Cochin as Branch Auditors to audit the accounts of Cochin unit for the year ended 31st March, 2014.

The remarks of the Board of Directors on the Auditors'' Report to the members are furnished in Annexure IV.

The report of the Comptroller & Auditor General of India under section 619(4) of the Companies Act, 1956, on the Accounts of the Company for 2013-14 is annexed to the Statutory Auditors'' Report in the Annual Report.

Pursuant to directions from the Ministry of Company Affairs for appointment of Cost Auditors, Board of Directors of the company appointed M/s V.J.Talati & Co. as the Cost Auditors of Rasayani Unit and also as Lead Auditors for the Year 2013-2014 for cost audit of Company''s Sulphuric Acid, Aniline, Formaldehyde, Caustic Soda, Nitro Benzene products (of Rasayani unit) and M/s Panikar & Company as cost Auditors of Kochi Unit for the year 2013-14 for Kochi Unit products viz. Phenol, Acetone & Polypropylene.

DIRECTORS

During the Financial Year 2013-14, in the month of June, 2013, the Government of India, vide its Order ( GOI Order No. P 51011/8/2012-32-CH.III ) dated 13th June, 2013 has appointed Shri. V.B. Ramachandran Nair, Chief General Manager, HOCL as Chairman- cum- Managing Director (CMD), on the Board of HOCL who has assumed the charge of CMD HOCL (from ACMD Shri J.N.Suryawanshi, DM) on 17/6/2013 (F.N.) for the period of five years or till the date of superannuation or till further orders, whichever is earlier. Shri. J.N. Suryawanshi, Director (Marketing) HOCL held the additional charge of Chairman & Managing Director from 1st May, 2013, in addition to his duties & responsibilities as Director (Marketing), as per GOI Order No. P.51011/01/2013-32-Ch-III dated 30/4/2013 upto 17-06-2013.(F.N.)

Further, GOI has appointed also Shri. Rajiv Yadav, Additional Secretary & Financial Advisor in the Ministry of Chemicals & Fertilizers as part-time Government Nominee Director in place of Dr. V.K. Subburaj, SS&FA, on the Board of HOCL, vide GOI Order No. 51/11/95-Ch-III-(Vol.II) dated 23rd June, 2014.

In terms of Article 76(4) of the Articles of the Association of the Company, Government Nominee Directors, viz. Shri Rajiv Yadav, Additional Secretary & Financial Advisor and Dr. A.J.V.Prasad, Joint Secretary, will retire at this 53rd AGM in 2014 and are eligible for reappointment. Company has placed its request letter to the Government for reappointing Shri Rajiv Yadav, AS&FA and Dr. A.J. V.Prasad, JS from the ensuing 53rd AGm of 2014 and till the holding of the next A.G.M. of the Company to be held in 2015 or till further Orders(whichever is earlier as per GOI Order).

ACKNOWLEDGMENT

Your Directors gratefully acknowledge the valuable guidance, support and directions given by the Government of India. Your Directors also gratefully acknowledge the support and co-operation extended by the State Governments, by the valued and esteemed customers, shareholders, suppliers, bankers, Statutory/Internal/Cost and Tax Auditors, Bondholders, and Investors at large.

Your Directors place on record their appreciation for the whole hearted efforts and contribution from all the employees and also acknowledge the support and co-operation of the entire Workers'' Unions and Employees'' Unions and their members for the smooth functioning of the Company''s operations.

For and on behalf of the Board of Directors of Hindustan Organic Chemicals Limited,

Sd/-

Place : Mumbai V.B. Ramachandran Nair Date : 13/08/2014 Chairman & Managing Director

---

Mar 31, 2013

To the Members of HINDUSTAN ORGANIC CHEMICALS LIMITED

Dear Shareholders

The Directors are pleased to present the 52nd Annual Report and the Audited Annual Accounts of the Company for the fi nancial year ended 31st March, 2013.

The financial performance of the Company for the year ended March 31, 2013 is summarized below:

(Rs.in Lacs)

Year ended Year ended

31/03/2013 31/03/2012

Sales 62419.40 60636.71

Operating Profit/(Loss) (8411.98) (2880.50)

Less: Interest 2824.15 2474.33

Depreciation 2232.95 2335.98

Profit/(Loss) before tax (13469.08) (7690.81)

Less: Provision for taxation

Less: Prior Period adjustments & Exceptional Items (329.83) (116.04)

Profi t/(Loss) after tax & Prior period adjustments,

Provisions and Exceptional Items (13798.91) (7806.85)

[Note: Previous years fi gures have been regrouped wherever necessary in the Current year]

In view of continuous incurring of losses during the current year as well as in the previous years, the Board of Directors did not recommend any Dividend for the current year under review.

Reporting to BIFR under SIC(SP)Act, 1985 :

In view of the fact that as on 31-03-2013 as the Company''s Accumulated Losses have resulted into 100% erosion of Net worth, Company is taking necessary steps for making a reference to Board for Industrial & Financial Reconstruction (BIFR) under prescribed Section of the Sick Industrial Companies (Special Provisions) Act, 1985.

RESULTS OF OPERATIONS :

During the year under review the Company has suffered Net loss of Rs. 137.99 crores, as against the Net Loss of the previous year of Rs. 78.07 crores .

As regards the unit wise performance, the Net Loss of Kochi Unit was Rs.36.05 crores as compared to the previous year''s profi t of Rs.26.02 crores. The Rasayani Unit recorded a Net Loss of Rs. 101.94 crores as compared with the previous year''s loss of Rs. 104.10 crores.

OPERATIONS :

During the year under report your company''s Rasayani unit achieved a sales turnover of 55562 MTs valuing Rs.16164 lacs as against 51268 MTs valuing Rs.11627 lacs registering a 39 % increase in sales.

During the year under report your company''s Kochi unit achieved a sales turnover of 55242 MTs valuing Rs.39337 Lacs as against 64298 MTs valuing Rs.43200 Lacs of the previous year.

With the production of 150979 MTs during the year 2012-13 as against the production of 178792 MTs in 2011-12, your company could achieve an overall capacity utilization of 37% during the year. Your company has recorded the sale of 110804MTs during the year (previous year 115566 MTs) valuing Rs55501 lacs (previous year Rs. 54827 lacs). The high labour cost and high incidence of cost on closed plants at Rasayani Unit are the major concerns. Company decided to operate those plants which were giving contribution. Your company has continued its cost cutting measures to counter these problems and in order to be competitive and improve performance and profi tability.

PRODUCTION : Kochi Unit:

During the year your company''s Kochi unit could achieve 100003 MTs of production as against the previous year production of 126076 Mts. The capacity utilization for the year was 65 %.

Rasayani Unit:

During the year your company''s Rasayani unit could achieve 50976 MTs of production as against the previous year production of 52716 MTs. The capacity utilization for the year was 20 %. Capacity utilization is affected due to high fi xed cost & fi nance constrains. MARKETING :

The chemical market is very much volatile, slow down demand of HOC main products as well as downstream products based on HOC products & stiff competition from import of HOC ''s main products at cheaper rate, increased raw material prices, during the Year 2012-13, Company has achieved in the highly competitive market , the sales turnover of Rs. 555.01 Crores (net of excise duty) as against Rs548.27 crores (net of excise duty) of the previous year(2011-12). The sale value could be achieved because of continued support from its valuable customers and due to excellent quality products produced at Kochi and Rasayani Units. The sales volume during year 2012-13 was 1,10,804 MTs as against 1,15,566 MTs for the year 2011-12. During last quarter of the fi nancial year there was good demand for Company''s products due to improved market conditions.

CURRENT / PRESENT SCENARIO.

The Kochi unit of the Company which was making profi ts continuously, year after year for the last (gap of) 10 years , but during the current year under review, for the fi rst time (in the span of 10 years), the Kochi Unit has incurred a loss of Rs.36.05 Crores (during the current year) . The main reason for the loss suffered by the unit was due to withdrawal of Anti-Dumping Duty on the Phenol and Acetone manufactured at Kochi unit, resulting in large scale import of /dumping of those imported products and forcing the company to reduce the prices to match the imported price of Phenol and Acetone. The raw material cost also went up drastically which increased the cost of production. The company has fi led review petition & fresh application for Anti-Dumping Duty to the concerned Authority, which will help to improve the better realisation.

STATUS OF OPERATIONS AND FUTURE PLANS & TURNAROUND/REVIVAL PLAN

Future course of Action/Revival Plan

The following are the future course of action planned for revival of the company.

Rasayani Unit

Retrofi tting of Conc. Nitric Acid plant (C.N.A), where N2O4 is produced has been completed in January 2013 and production has started whereby 500 TPA of N2O4 for ISRO could be produced. This will reduce the cost of production of C.N.A which is used as input in Nitrobenzene and Aniline Plants.

Approval has been obtained for disposal of non performing (closed) plant and machinery at Rasayani Unit to generate funds to the tune of Rs 12.51 Crore (Rounded off). This amount will be utilized for clearing the outstanding Working Capital dues.

The Tankage facility in the 5 Acres leased land at JNPT to be operated on BOT basis with a third party investment with the approval from JNPT authorities.

It is proposed to carryout retrofi tting of Nitrobenzene and Aniline Plant at a cost of Rs 12 Crore (Approx) whereby the turnover could increase by Rs 60 Crore from the increased production and also reduction in cost of production to improve the margins.

In order to raise resources for repayment of Rs 100 Crore bonds and to meet working capital requirement, it is proposed to dispose of 8 Acre of temporary township land at Panvel, with the approval from the Govt of Maharashtra and Govt of India.

In connection with investment in future expansion plans, it is proposed to dispose of 50 acres of land at Rasayani.

Kochi Unit

HOCL Kochi Unit is using LSFO as fuel for boilers, Hot oil furnace and CPP. GAIL has laid pipeline network for the supply of gas and have already installed the metering station for LNG in HOCL premises. Kochi Unit has modifi ed its burner and other accessories in boiler, hot oil unit to suit LNG and LSFO (duel fi red) during the annual shutdown in the month of June''2013.The supply of LNG is expected to commence from September 2013. The replacement of LSFO by LNG as a fuel will give substantial cost reduction and savings to the company. The estimated annual saving on expenditure is Rs. 10 crore per annum.

The de-bottlenecking of Hydrogen peroxide plant at Kochi has been completed at the cost of Rs. 2 crores, which will increase the production capacity of the plant by 4000 MTPA (40% increase) and increase in turnover by Rs. 12 crores.

ENERGY CONSERVATION/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions required to be disclosed under Section 217(2)(e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, Technology Absorption and Foreign Exchange Earning and outgo, are given at Annexure II to this Report. RESEARCH & DEVELOPMENT

Our R&D efforts for the ''in-house'' development vapour phase continuous process for ISRO-specifi c grade kerosene by name ''ISROSENE'' have succeeded in scale up of the laboratory scale process (developed during the previous year) to the pilot plant (HOC''s multi-purpose pilot plant) scale. Initial runs and samples from the same meet the desired specifi cation. Further runs to establish the plant scale process Parameters are also successful. Optimization of the same is being done to establish technology for commercial scale implementation. Two nos. of Indian patents have been granted to our Company in the area of Intellectual Property Rights (IPR). We earned a royalty of Rs. 11.5 lakhs based on the MOU for joint technological development of improved chrome- free copper oxide catalyst, with M/s Sud - Cheme (I) Pvt. Ltd.

HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS:

Human Resource is a vital resource and Company has recognized the importance of the same. To meet the challenges of global competitive environment, the Company is up grading the skills of their employees by systematically identifying training need of employees. Accordingly, Company is arranging in house training programmes at its Training Centre and also sponsoring employees for outside training programmes. The position relating to SC/ST/Women personnel in the Company is given in Annexure - III to the Directors'' Report.

II. Training:

Training were imparted to employees based on operational requirement/needs identifi cations with the allocated resources to enhance Soft Skills, Technical and Managerial Skills. Due importance was given and constant efforts were made to impart Health, Safety and Environment aspects considering the nature of hazards in our Unit. During 2012-13 we have organized training programmes both Internal/External covering 505 mandays with the help of Internal/External Experts. Specifi c user training in functional module of ERP was also imparted to the employees so as to make the SAP system more user friendly. Regular refresher course in Safety and Environmental Management were organized.

Apart from employees training our Company has extended the facilities and resources to students coming from different Engineering Colleges, Management Institutions to enhance their practical knowledge/for experiential learning. Company also enages Graduate/Technical/Trade/Vocational Apprentices to undergo Apprenticeship Training in different discipline under the Apprentices Act 1961.

III. Industrial Relations :

By and large the climate of harmonious and cordial Industrial Relations was maintained in the Company throughout the year.

IV. Suggestion Scheme:

The Suggestion Scheme is in existence in the Company. All employees and Company Trainees are eligible to participate in this scheme. The Suggestions received from the employees are evaluated by a Suggestion Committee and the selected suggestions are awarded with Cash Prizes also.

CORPORATE SOCIAL RESPONSIBILITY

Company since its inception is very much aware about its social responsibility. For over fi ve decades , as a socially responsible and sensitive corporate, your Company continuous to remain committed to social thought and action to serve society. Company has provided basic civic amenities to the neighbouring villages, rendered assistance in different forms, drinking water, etc. Company has also undertaken tree plantation programme in the surrounding area. Company is also giving medicines to the needy poor persons in and around the area through Dr. Kasbekar Memorial Trust.

To promote the School education, Company is giving scholarship to SC/ST students studying in X and XIIth Stds.

Company has also constructed and maintained a hall in the name of Bharatratna Dr. Babasaheb Ambedkar with a view to provide a platform for discussion/ seminar/symposiums on principles/ teaching of Dr. Babasaheb Ambedkar.

Kochi Unit has donated Rain Coats to Ambalamedu Police Station for the use of Police personnel.

During the current year under review, as per Department of Public Enterprise (DPE)

Guideline on Corporate Social Responsibility (CSR), Company has constituted Board level Corporate Social Responsibility (CSR) and Sustainability (SD) Committee comprising of Independent Director & other two Directors from the Board of the Company.

The terms of reference of the said CSR&SD Committee included among others set up of the Committee with existence of the two tier organization structure with mandatory membership of an Independent Director on the Board level committee, frequency of meeting, range of decision, staff / stakeholder involvement etc.

PARTICULARS OF EMPLOYEES - INFORMATION REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956 .

No employee of the Company has drawn the remuneration during the year 2012-13 or any part thereof, in excess of the limits specifi ed under the Company''s (Particulars of Employees) Rules 1975.

Accordingly particulars of employees'' remuneration prescribed u/sec 217 (2A) of the Companies Act, 1956 are not furnished.

VIGILANCE

The Vigilance Department, headed by Chief Vigilance Offi cer, appointed by Government of India on deputation, has three main functional offi cers, one each at Rasayani (Raigad) in Maharashtra, and at Ambalamugal (Kochi) in Kerala and third at Corporate offi ce, Mumbai. Keeping in view of the Principles of Corporate Governance, the main focus of the Vigilance Department has been to help the sincere, dedicated and honest personnel working in the Organization to discharge their duties effectively and effi ciently so that the target of optimum turnover and profi tability are achieved in a transparent manner. More emphasis is given in improving the functioning of all sections and maintaining transparency.

The Vigilance department takes appropriate and timely action in respect of complaints received. There is a comprehensive complaint handling policy and prescribed punitive action is duly suggested, after conducting fair and impartial investigation/enquiry, where ever required. The Annual Property Returns of the offi cers are periodically scrutinized and inspection of departmental activities are undertaken to detect deviations, if any and suggest corrective measures. Vigilance Awareness Programmes, as per guidelines issued by the CVC, are observed and awareness sessions are conducted for the personnel regarding vigilance related matters as well as in respect of CDA Rules, RTI Act, PIDPI (Whistle Blowers Act) etc. The vigilance department has been instrumental in updating the existing manuals and policies i.e. the Purchase Policy, the Works Policy, the Marketing Manual, the Vigilance manual etc., so that the laid down procedures, policies, rules, regulations etc., of the Company and that of Central Vigilance Commission are duly followed.

The Vigilance Department maintains close interaction with CVC, CBI and other Government agencies. The Vigilance wing has been sincerely and consistently helping all personnel of the Organization in improving their effi ciency and effectiveness and, in turn, achieving the set goals of the Organization.

HEALTH, ENVIRONMENT, FIRE & SAFETY Health :

- Physical Check-up, the Special Certifi cate of Fitness in Form No. 23 and ascertaining Health Status in Form No. 7 of all employees have been carried out by the Certifying Surgeon for the year 2012.

- Periodic Medical Check-up of all employees as well as various health awareness training programmes were carried out by specialist doctors for the benefi t of employees.

- No Complains are noticed among the employees working in the various plants.

Environment, Fire & Safety :

Revenue generation by Health and Hygiene department giving analytical support and technical support to nearby industries, as well as miscellaneous income amounting to total Rs. 5.36 lakhs.

- Our Laboratory is recognized by CPCB, undertaken outside samples analysis for physical and chemical parameter on chargeable basis generating a revenue to the tune of Rs.1 lakh.

- To ascertain that the level of pollutants are maintained within acceptable limits, ambient air quality monitoring, Stack emissions, Noise monitoring, workplace monitoring & analysis of inorganic and organic chemicals is being carried out a various locations in plants and in other locations.

- Testing of Flammable gases for issue of hot permit under safety policy.

The Company pays special attention to ensure safety of the factory and workers employed therein.

The Company accords the same priority attention to safety aspects as it does to production and productivity, be it in a personal safety, process safety, environmental safety or product stewardship and allocated adequate resources of men, machine, money, time and energy to maintain the standards. Thus performance during the year is very good.

The company continued to maintain good safety record without any major accident or Fire. Consistent safety training, safety audit, safety inspection and Hazop studies were performed to keep the safety standard high. The company is taking active participation in Off-site Emergency drills, Local and District Crisis group activities. In order to augment our fi re fi ghting capacity, mutual and scheme for emergency help between HOCL, BPCL- KR & FACT (CD) is in existence.

HOC is a signatory to "Responsible Care" movement. We are committed to the concept of self-realization and improvement in all aspects of safety.

Emergency Response Centre (ERC), a voluntary commitment undertaken by Rasayani unit to tackle emergencies arising out of road transportation of hazardous chemicals is functioning quite well and this effort is acknowledged by general public as well as government authorities.

Our employees have bagged maximum awards in zonal level safety competitions. HOC is a major contributor to Mutual aid Response Group - Khopoli, Rasayani, Patalganga zone (MARG-KRAPA).

The Company has made it mandatory to have fi re and safety training for all employees.

HOCL Kochi unit could maintain the quality of treated effl uent, stack emission and ambient air quality well within the limits stipulated by statutory authorities throughout the year.

HOC Kochi unit received pollution control award among very large scale industries from Kerala State Pollution Control Board for substantial and sustained efforts in pollution control in 2012.

The following improvements carried out in the fi eld of environment control.

a) Dewatering system is installed in effl uent treatment plant for fi ltering excess biological sludge bleed off from the system.

b) Installed system hardware at our main control room with software for online transmission of treated effl uent pH analyser data to KSPCB / CPCB server.

c) Recorders in effl uent treatment plant are changed to paperless recorder system. It help to retrieve the old data.

d) Level instruments with recorder is provided for Mixing Tank and Raw Effl uent Sump at ETP control room for better process control in ETP.

HOC Kochi unit received safety awards from Dept. of Factories & Boilers, Govt. of Kerala for outstanding performance in industrial safety for the year 2012.

Security System :

Kochi Unit of HOCL has been classifi ed as ''MAJOR ACCIDENT HAZARD INSTALLATION'' by the Govt. of Kerala. The security requirements are met from the agencies sponsored by the Director General (re-settlement), Ministry of Defense, Govt. of India. Security Guard are posted in the identifi ed areas inside the Factory premises and also in Township round the clock.

In view of the increased threat perception in Kochi, the Unit has been advised to take suitable measures for upgrading the security by the concerned authorities. Action is being taken to upgrade the present security system.

IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY .

During the year, your Company continued its intensive and extensive efforts for progressive use of the offi cial language. To promote Hindi as offi cial language is day to day working in line with the Government policies, Offi cial Language Implementation Cell of the Company continued to function effectively. Various cash incentive schemes have been introduced in the Company. Hindi workshops are being conducted regularly. Offi cial Language Implementation Committee meetings are arranged every quarter. Comprehensive programme like Hindi FORTNIGHT was organized at both Rasayani & Kochi units and the Corporate Offi ce in Mumbai during Sept. 2012. Several periodical meetings, training programmes, workshops, essay writing, noting & drafting, Hind Typing, Quiz Recitation, Word formation, Passage etc. Competitions were organized to progress the use of Hindi. Rasayani unit received a symbol for the best Hindi work done in year 2011-12 on "B" Region on behalf of Hindi advisory committee of Parliament. Kochi Unit received fi rst prize for the best implementation of Offi cial Language from Kochi Town Offi cial Language Implementation Committee.

1) All documents coming Under Sec. 3(3) of the Offi cial Language Act, 1963 are issued in bilingual form.

2) The Hindi letters received are being replied in Hindi to comply with the rule 5 of Offi cial Language Rules 1976. All nameplates, Sign Board, Visiting Cards, Demi- Offi cial letters heads are prepared is bilingual form.

3) Web site of the Company is prepared to Hindi also www.hocl.hindi.gov.in

4) Every day one bilingual word being exhibited in the pest Board.

Every year effort are made to fulfi ll the targets set in the Annual programme issued by Department of Offi cial Language Ministry of Home Affairs.

ISO CERTIFICATION :

HOCL, Rasayani Unit, has been awarded ISO-9001:2008 certifi cate on 11.01.2011. This certifi cate has been awarded by M/s Bureau Veritas Certifi cation (India) Pvt. Ltd. and is valid till 9/02/2014.

Second Surveillance Audit was carried out under ISO-9001:2008 standard on 24th & 25th January, 2013 by M/s. BVCI.

HOCL Kochi unit is an ISO 9001: 2008 (Quality Management System) and ISO 14001:

2004 (Environmental Management System) certifi ed company. The existing certifi cate for ISO 9001 & ISO 14001 is valid up to 2014.

BVCI Conducted routine surveillance audit periodically for both the systems.

INSURANCE

All properties and insurable interest of the Company including building, plant and machinery and goods are adequately insured. As required under Public liability Insurance Act, 1991 the company has taken necessary insurance cover.

FIXED DEPOSITS

With regard to Fixed Deposits, nothing is outstanding towards FDR for the Financial Year 2012-13.

DEPOSITORY SYSTEM

As the members are aware your company''s shares are tradable compulsorily in electronic form and your Company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the enormous advantages offered by the Depository system, Members are requested to avail the facility of dematerialisation of the Company''s shares on either of the depositories as aforesaid.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with the listing agreement, the Management Discussion and Analysis Report is annexed hereto in Annexure V and forms part of the Directors'' Report.

CORPORATE GOVERNANCE

The Company has complied with the various requirements of Corporate Governance. The details in this regard form part of this report in Annexure VI.

RESPONSIBILITY STATEMENT

The Directors confi rm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) that they 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 fi nancial year and of the profi t or loss of the company for that period;

c) that they have taken proper and suffi cient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) that they have prepared the annual accounts on a going concern basis.

HINDUSTAN FLUOROCARBONS LIMITED: (Subsidiary)

OPERATION AND OVERALL PRODUCTION AND MARKETING PERFORMANCE:

During the year, the sales turnover (net) was Rs.4080.31 lacs as against Rs.6282.93 lacs in the previous year. During the year under report production of PTFE was 154.78 Metric Tons as against 143.83 Metric Tons in the previous year. During the year, 244.73 Metric Tons of CFM-22 was sold in the market against 291.77 Metric Tons in the previous year and balance quantity was used as feed stock to manufacture various products including Fluoro Specialty Chemicals. Accordingly, during the year 156.14 Metric Tons of Tetra Fluoro Etylene (TFE) was used to manufacture TFE-ETHER. Quality of all company''s products continued to be well accepted by our customers. Company has achieved 82% capacity utilization for CFM-22 for this year.

CLEAN DEVELOPMENT MECHANISM (CDM):

Company has received payment of second and Third issuance during the fi nancial year.

Main customer for CERs was European Union, but due to various reasons they have banned the trading of CERs generated from R-23 Project.

Hence it is not economically viable to generate CER from R-23 Project.

The Statement Pursuant to Sec. 212 of the Companies Act, 1956 is given in Annexure I.

AUDITORS

In terms of provisions of Section 619(2) of the Companies Act,1956, the Comptroller & Auditor General of India, under its letter No.CA. V/COY/CENTRAL GOVT,HOCL(2)/76 dated 27/7/2012 has appointed M/s FORD RHODES PARKS & CO, Chartered Accountants, Mumbai as Auditors of the Company to audit the accounts of the Rasayani unit and to audit the consolidated accounts of the company. Vide CAG under its letter No.CA. V/COY/CENTRAL GOVTHOCL (2)/76 dated 27/7/2012 has appointed M/s SASI VIJAYAN & RAJAN, Cochin as Branch Auditors to audit the accounts of Cochin unit for the year ended 31st March, 2013.

The remarks of the Board of Directors on the Auditors'' Report to the members are furnished in Annexure IV

The report of the Comptroller & Auditor General of India under section 619(4) of the Companies Act, 1956, on the Accounts of the Company for 2012-13 is annexed to the Statutory Auditors'' Report in the Annual Report.

Pursuant to directions from the Ministry of Company Affairs for appointment of Cost Auditors, Board of Directors of the company appointed M/s VJ.Talati & Co. as the Cost Auditors of Rasayani Unit and also as Lead Auditors for the Year 2012-2013 for cost audit of Company''s Sulphuric Acid, Aniline, Formaldehyde, Caustic Soda, Nitro Benzene products (of Rasayani unit) and M/s Panikar & Company as cost Auditors of Kochi Unit for the year 2012-13 for Kochi Unit products viz. Phenol, Acetone & Polypropylene products .

DIRECTORS

Recently during the current FY 2013-14, during June, 2013, the Government of India, vide its Order ( GOI Order No. P 51011/8/2012-32-CH.III ) dated 13th June, 2013 has appointed Shri. V.B. Ramachandran Nair, Chief General Manager, HOCL as Chairman- cum- Managing Director (CMD), on the Board of HOCL. Shri. V.B. Ramachandran Nair, has assumed charge (from Shri J.N.Suryawanshi, DM&ACMD) on 17/6/2013 (FN.) for the period of fi ve years or till the date of superannuation or till further orders, whichever is earlier.

Earlier, on 30-04-2013, Shri R.N. Madangeri , Chairman & Managing Director, HOCL was retired on superannuation from the services of the Company in terms of GOI''s Order(of 9th June, 2011) and Shri. J.N. Suryawanshi, Director (Marketing) HOCL held the additional charge of Chairman & Managing Director, in addition to his duties & responsibilities as Director (Marketing), as per GOI Order No. P.51011/01/2013-32-Ch-III dated 30/4/2013 upto 17-06-2013.(Forenoon).

Further, GOI has appointed also Shri. V.K. Subburaj, Additional Secretary & Financial Advisor in the Ministry of Chemicals & Fertilizers as part-time Government Director in place of Dr. V. Rajagopalan, SS&FA, on the Board of HOCL, vide GOI Order No. 51/11/95-Ch-III-(Vol.II) dated 14th May, 2013.

During the previous year, during April, 2012 GOI has appointed [vide its Order dated 9th April, 2012] Dr. N.J. Gaikwad from Nagpur, as Non offi cial part time Director on the Board of HOCL who took the charge on 22nd May, 2012.

Further, in the same year 2012, GOI has appointed Director Shri Suresh Kumar R. , {ex GM(Fin.)Kochi Unit] as Director (Finance) on the Board of HOCL( vide GOI Order No. 51/18/2011-Ch-III dated 11th May, 2012) w.e.f.11-05-2012. And GOI has GOI has also appointed Shri S.B. Bhide, Chief General Manager, as Director (Technical) on the Board of HOCL [vide GOI Order No. 51/14/2011-Ch-III dated 14th June, 2012] w.e.f.14-06-2012.

In terms of Article 76(4) of the Articles of the Association of the Company, Government Nominee Directors, viz. Shri V.K. Subburaj, Additional Secretary & Financial Advisor and Dr. A.J.V.Prasad, Joint Secretary, will retire at this 52nd AGM in 2013 and are eligible for reappointment. Company has placed its request letter to the Government for reappointing Shri V.K. Subburaj AS&FA and Dr. A.J. V.Prasad , JS from the ensuing 52nd AGM of 2013 and till the holding of the next A.G.M. of the Company to be held in 2014 or till further Orders(which ever is earlier as per GOI Order).

ACKNOWLEDGMENT

Your Directors gratefully acknowledge the valuable guidance, support and directions given by the Government of India. Your Directors also gratefully acknowledge the support and co-operation extended by the State Governments, by the valued and esteemed customers, shareholders, suppliers, bankers, Statutory/Internal/Cost and Tax Auditors, Bondholders, and Investors at large.

Your Directors place on record their appreciation for the whole hearted efforts and contribution from all the employees and also acknowledge the support and co-operation of the entire Workers'' Unions and Employees'' Unions and their members for the smooth functioning of the Company''s operations.



For and on behalf of the Board

of Directors of Hindustan Organic Chemicals Limited,



Sd/-

Place : Mumbai V.B. Ramachandran Nair

Date : 05/08/2013 Chairman & Managing Director

---

Mar 31, 2012

To the Members of HINDUSTAN ORGANIC CHEMICALS LIMITED

Dear Shareholders

The Directors are pleased to present the 51st Annual Report and the Audited Annual Accounts of the Company for the financial year ended 31st March, 2012.

The financial performance of the Company for the year ended March 31, 2012 is summarized below: (Rs.in Lacs)

Year ended Year ended 31/03/2012 31/03/2011

Sales 60636.71 73803.91

Operating Profit/(Loss) (2,801.42) 7285.91

Less: Interest 2373.78 2138.86

Depreciation 2304.51 2517.74

Profit/(Loss) before tax (7,479.71) 2629.31

Less: Provision for taxation - -

Less: Prior Period adjustments & Exceptional Items (327.14) 57.72

Profit/(Loss) after tax & Prior period adjustments, Provisions and Exceptional Items. (7,806.86) 2571.59

Results of Operations

During the year under review the Company was under Net loss of Rs. 78.07 crores, while the Net profit during the previous year was Rs. 25.72 crores .

As regards the unit wise performance, the Net Profit of Kochi Unit was Rs.26.02 crores which was much lesser as compared to the previous year's profit of Rs.130.08 crores. The Rasayani Unit recorded a Net Loss of Rs. 104.10 crores as compared with the previous year's loss of Rs. 104.37 crores.

Reporting to BIFR under SIC(SP)Act, 1985 .

In view of the fact that as on 31-03-2012 as the Company's Accumulated Losses have resulted into erosion of more than 50% of the Peak net worth (of the immediately preceding 4 years), Company is taking necessary steps under Section 23(c) of SIC (SP)Act,1985.

OPERATIONS :

During the year under report your company's Kochi unit achieved a sales turnover of 64298 MTs valuing 43200 Lacs as against 84082 MTs valuing 58120 Lacs of the previous year.

With the production of 178792 MTs during the year 2011-12 as against the production of 251007 MTs in 2010-11, your company could achieve an overall capacity utilization of 42% during the year. Your company has recorded the sale of 115566 MTs during the year (previous year 145173 MTs) valuing Rs.54827 lacs ( previous year Rs. 66736 lacs).

The high labour cost and high incidence of cost on closed plants at Rasayani Unit are the major concerns . Company decided to operate those plants which are giving contribution. Your company has continued its cost cutting measures to counter these problems and in order to be competitive and improve performance and profitability.

PRODUCTION :

Kochi Unit:

During the year your company's Kochi unit could achieve 126076 MTs of production as against the previous year's production of 167886 MTs. The capacity utilization for the year was 82 %. Rasayani Unit:

During the year your company's Rasayani unit could achieve 52716 MTs of production as against the previous year's production of 66798 MTs. The capacity utilization for the year was 27 %.

MARKETING :

In the highly volatile chemical market, sluggish demand & stiff competition from import of HOC's main products, during the Year 2011-12, Company has achieved the sales turnover of Rs. 548.27 Crores (net of excise duty) as against Rs. 667.36 crores (net of excise duty) of the previous year(2010-11) . The sale value achieved because of continued support from its valuable customers and due to excellent quality products produced at Kochi and Rasayani Units. The sales volume during year 2011-12 was 1,15,566 MTs against 1,45,173.65 MTs for the year 2010-11. STATUS OF OPERATIONS AND FUTURE PLANS Refurbishment of CNA/N2O4 Plant - Ph. II is in progress with implementation of new DCS and will be completed during F.Y.2012-13.

Hydrogen Peroxide Plant capacity will be enhanced to the targeted capacity of 14,000MT/p.a. from installed capacity of 10450MT/p.a. by carrying out in house de-bottlenecking.

ENERGY CONSERVATION/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions required to be disclosed under Section 217(2)(e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, Technology Absorption and Foreign Exchange Earning and outgo, are given at Annexure II to this Report. RESEARCH & DEVELOPMENT

R&D efforts this year too have continued in the IPR (Intellectual Property Rights) portfolio as regards filing of new patents is concerned. Three numbers of Indian Patents were granted this year. After successful laboratory scale development of vapour phase continuous process for ISRo specific grade kerosene fuel, pilot plant scale study is being started. Various process parameter are being correlated by a model.

HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS:

Our strength is our Human Resource. The Company continues to recognize that human asset is very much valuable for the continual improvements in the performance of the company, particularly in the context of competition all around. The company greatly values their contribution and dedication and is committed to the development and growth of this vital resource. In order to attain the twin objective of reducing manpower and restructuring of human resources for optimum utilization of available man power. Company continues to implement Government Policy of Reservation for SC/ST and other categories. The position relating to SC/ST/Women personnel in the Company is given in Annexure - III to the Directors' Report.

II. Training

A developed human resource is an asset for the enterprise. Company gives utmost importance to enhance the skills of our employees through Training & Development Programmes. Training is imparted based on identification of Training Needs in areas such as Safety, Advanced Technology, Modern Management Techniques, Soft Skills, Energy and Environment Management Systems, First Aid, Participative Management and Workers Education, Information Technology etc. During the Financial Year 2011 - 2012 at Kochi Unit, Company has organised various Training Programmes both Inhouse and External covering 537 mandays with the help of External/Internal Experts based on requirement and identification of Training Needs. At Rasayani Unit, In house as well as outside training programs have been arranged for the benefit of the employees. During the year 2011-2012, in all 74 training programs were conducted,1239 mandays were trained through inhouse training programs, 356 mandays were trained by sponsorship i.e. outside training and 248 mandays were trained through on job training. Thus, total 1843 mandays were trained during the year.

As part of the implementation of ERP in HOCL at Kochi Unit much emphasis was given in imparting training to the employees. ERP training imparted in various levels, that is Core Committee Training, Steering Committee Training and Functional Heads Training and Core User Training. Training was imparted in general as well as for the Core functionalities, Usage of Employees Self Service etc. End user training on different modules are also imparted so as to keep the system more user friendly.

Regular Refresher courses were arranged in Safety & ISO implementations. First Aid Recertification course was also arranged during this year.

Considering the importance of Energy conservation, training on Energy conservation by experienced faculty members from Petroleum Conservation Research Association Mumbai was conducted.

In Chemical Industry, First Aid training to the employees is of prime importance in safety point of view. Accordingly, 75 employees at Rasayani Unit were trained by Life Line Institute of First Aid &Emergency Medicine, Thane, Mumbai.

III.Industrial Relations

By and large the climate of harmonious and cordial industrial relation was maintained in the Company throughout the year.

IV. Suggestion Scheme

The Suggestion Scheme is in existence in the Company. All employees in the Company are eligible to participate in this scheme. The Suggestions received from the employees are evaluated by a Suggestion Committee and the selected suggestions are awarded with Cash Prizes ranging from Rs.100/ - to Rs. 5000/- CORPORATE SOCIAL RESPONSIBILITY The company is very much conscious about its social responsibility, right from its inception. To fulfill this, company has provided basic civic amenities to the neighboring villages, rendering assistance to the neighborhood in different forms viz. Financial assistance, drinking water supply, medicine, etc.

To promote school education, company is giving scholarship to X and XII Std. Students. Company extends need based assistance to deserving SC/ST students in the nearby villages of their graduate education. Company also extends vocational training facilities to the wards of employees studying in nearby engineering colleges/ and Management institutes for enhancing their practical knowledge. Company also engages diploma (sandwich course) apprentices as a part of their curriculum for imparting practical training.

Company has also constructed and maintained a hall in the name of Bharatratna Dr. Babasaheb Ambedkar with a view to provide a platform for discussion / seminars/ symposiums on principles / teachings of Dr. Babasaheb Ambedkar.

HOCL, Kochi Unit has sponsored Medical Equipments to Govt. Taluk Headquarters Hospital, Tripunithura at a total cost of Rs.8,70,000/-. Kochi Unit has donated Rain Coats to Ambalamedu Police Station for the use of Police Personnel and Uniforms to the poor students of Mar Athanesius High School, Kakkanad .

PARTICULARS OF EMPLOYEES - INFORMATION REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

No employee of the Company has drawn the remuneration during the year 2011-12 or any part thereof, in excess of the limits specified under the Company's (Particulars of Employees) Rules 1975.

Accordingly particulars of employees' remuneration prescribed u/sec 217 (2A) of the Companies Act, 1956 are not furnished.

VIGILANCE

The Vigilance Department, headed by Chief Vigilance Officer, appointed by Government of India on deputation, has three main functional Offices, one at Rasayani (Raigad) in Maharashtra, and at Ambalamugal (Kochi) in Kerala and another at Corporate office, Mumbai. Keeping in view of the Principles of Corporate Governance, the main focus of the Vigilance department has been to help the sincere, dedicated and honest personnel working in the Organization to discharge their duties effectively and efficiently so that the target of optimum turnover and profitability are achieved in a transparent manner. More emphasis is given in improving the functioning of all sections and maintaining transparency.

The Vigilance department takes appropriate and timely action in respect of complaints received. There is a comprehensive complaint handling policy and prescribed punitive action is duly suggested, after conducting fair and impartial investigation/ enquiry, where ever required. The Annual Property Returns of the Officers are periodically scrutinized and inspection of departmental activities are undertaken to detect deviations, if any, and suggest corrective measures. Various Vigilance Awareness Programmes, as per guidelines issued by the CVC, are observed and awareness sessions are conducted for the personnel regarding vigilance related matters as well as in respect of CDA Rules, RTI Act, PIDPI (Whistle Blowers Act) etc. from time to time. The vigilance department has been instrumental in updating the existing manuals and policies i.e. the Purchase Policy, the Works Policy, the Marketing Manual, the Vigilance Manual etc., so that the laid down procedures, policies, rules, regulations etc., of the Company and that of the Central Vigilance Commission are duly followed.

HEALTH, ENVIRONMENT, FIRE & SAFETY Health :

- Based on the toxicity of chemicals periodic medical examination of all the employees is carried out by doctors specially trained in occupational health and hygiene at Company's Health Centers at both the units.

- Various health awareness training programs were carried out by specialist doctors (both external and internal) for the benefit of employees. Large number of employees attended the same.

Environment, Fire & Safety:

The Company pays special attention to ensure safety of the factory and workers employed therein.

The Company accords the same priority attention to safety aspects as it does to production and productivity, be it in a personal safety, process safety, environmental safety or product stewardship and allocated adequate resources of men, machine, money, time and energy to maintain the standards. Thus performance during the year is very good. During the year under review, Company has Nil reportable accidents.

The company continued to maintain good safety record without any major accident of Fire. Consistent safety training, safety audit, safety inspection and Hazop studies were performed to keep the safety standard high. The company is taking active participation in Off-site Emergency drills, Local and District Crisis group activities. In order to augment our fire fighting capacity, mutual aid scheme for emergency help between HOCL, BPCL - KR & FACT (CD) is in existence.

HOC is a signatory to "Responsible Care" movement. We are committed to the concept of self-realization and improvement in all aspects of safety.

Emergency Response Centre (ERC), a voluntary commitment undertaken by Rasayani unit to tackle emergencies arising out of road transportation of hazardous chemicals is functioning quite well and this effort is acknowledged by general public as well as government authorities.

Our employees have bagged maximum awards in zonal level safety competitions. HOC is a major contributor to Mutual aid Response Group - Khopoli, Rasayani, Patalganga zone (MARG-KRAPA). HOCL Kochi unit could maintain the quality of treated effluent, stack emission and ambient air quality well with in the limits stipulated by statutory authorities through out the year.

HOC Kochi unit received safety awards from Dept. of Factories & Boilers, Govt. of Kerala for outstanding performance in industrial safety for the year 2011.

The Company has made it mandatory to have fire and safety training for all employees.

ISO CERTIFICATION :

HOCL, Rasayani Unit, has been awarded ISO-9001:2008 certificate on 11.01.2011. This certificate has been awarded by M/s Bureau Veritas Certification (India) Pvt. Ltd. and is valid till 9/02/2014.

First Surveillance Audit was carried out under ISO-9001:2008 standard on 10th & 11th January, 2012 by M/s. BVCI.

HOC Kochi unit is an ISO 9001: 2008 (Quality Management System) and ISO 14001: 2004 (Environmental Management System) certified unit.

BVCI conducted recertification audit of ISO 9001: 2008 and recertification is valid up to 18th June 2014.

BVCI recertified HOC Kochi unit for ISO 14001:2004, Environmental Management System and certificate is valid up to 19th November 2014.

IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY

In compliance of section 3(3) of the Official Language Act, 1963 and Official Language Rules 1976 framed thereunder, Company has implemented various measures effectively given in the annual programme for 2011-12. All documents coming under Section 3(3) like Part I Orders, Part II Orders, Circulars, Administrative and other Records, Press-Release etc. were issued bilingually. All Hindi Letters were answered in Hindi only. Our Company participated in all the programmes organized by Mumbai Town Official Language Implementation Committee.

To comply with the provision of Official Language Act 1963 and Rules there under we have implemented various items at both Units as per the Annual Program for the year 2011-12

1. The Hindi letters received are being replied in Hindi to comply with the rule 5 of Official Language Rules 1976. All name plates, Sign Boards, Visiting Cards, daily Official Letters and letter heads are prepared in Bilingual form. All documents that are issued under rule 3(3) of Official Language Act 1963 are prepared in bilingual form.

2. Cash Incentive scheme for doing original work in Hindi is existing in our Units and during September 2010 to August 2011-12 employees have received the incentive. To improve the Hindi word power of the employees, one bilingual word is being exhibited in the presto board kept in the reception and the list of the same is being circulated in the end of the month.

3. To comply with the Official Language Policy of the Government, Workshops on Official language are regularly conducted for the employees who possess working knowledge in Hindi so as to encourage them to use Hindi in their day to day office work. 5 workshops and One Unicode training were conducted during the period under report.

4. Kochi Unit received Third Prize for Best Implementation of OL from Kochi Town Official Language Implementation Committee.

5. Hindi Fortnight was organized at both Rasayani and Kochi Units and in the Corporate Office in Mumbai from 14th September, 2011 to 28th September, 2011. During this period various competitions were organized. Employees were actively participated in these competitions.

6. Efforts are being made to fulfil the target set in the Annual Programme issued by Department of Official Language, Ministry of Home Affairs. CMD has himself participated in the Hindi Salahakar Committee Meeting of the Chemicals & Fertilizers Ministry in the year 2011.

7. A five days Hindi Translation Training programme was organized with the help of HTS Mumbai. For the progressive use of Information Technology through medium of Hindi all the computers are being loaded with Unicode.

INSURANCE

All properties and insurable interest of the Company including building, plant and machinery and goods are adequately insured. As required under Public liability Insurance Act, 1991 the company has taken necessary insurance cover.

FIXED DEPOSITS

With regard to Fixed Deposits, nothing is outstanding towards Fixed Deposits for the Financial Year 2011-12.

DEPOSITORY SYSTEM

As the members are aware your company's shares are tradable compulsorily in electronic form and your Company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the enormous advantages offered by the Depository system, Members are requested to avail the facility of dematerialisation of the Company's shares on either of the depositories as aforesaid.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with the listing agreement, the Management Discussion and Analysis Report is annexed hereto in Annexure V and forms part of the Directors' Report.

CORPORATE GOVERNANCE

The Company has complied with the various requirements of Corporate Governance. The details in this regard form part of this report in Annexure VI.

RESPONSIBILITY STATEMENT

The Directors confirm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) that they 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 or loss of the company for that period;

c) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956, for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) that they have prepared the annual accounts on a going concern basis.

HINDUSTAN FLUOROCARBONS LIMITED :

(Subsidiary).

OPERATION AND OVERALL PRODUCTION AND MARKETING PERFORMANCE:

During the year, the sales turnover was Rs.4557.30 lacs as against Rs.3039.38 lacs in the previous year. During the year under report production of PTFE was 139.19 MTs as against 124.58 MTs in the previous year. During the year, 291.77 MTs of CFM-22 was sold in the market and balance quantity was used as feed stock to manufacture various products including Fluoro Specialty Chemicals. Accordingly, during the year 265.17 MTs of Tetra Fluoro Etylene (TFE) was used to manufacture TFE-ETHER. Quality of company's all products continued to be well accepted by the customers. Company has achieved 100% capacity utilization consecutively for this year also and produced 1265 MTs. This will enhance revenue earning from CDM for the next year.

CLEAN DEVELOPMENT MECHANISM (CDM):

Company has successfully implemented the CDM Project and earned Rs.17.47 Crore against first issuance. It is expected that during the financial year 2012-13 also, company will get CDM Income.

The Statement Pursuant to Sec. 212 of the Companies Act, 1956 is given in Annexure I.

AUDITORS

In terms of provisions of Section 619(2) of the Companies Act,1956, the Comptroller & Auditor General of India, under its letter No. CA V/COY/CENTRAL G0VT,H0CL(2)/102 dated 18/ 8/2011 has appointed M/s FORD RHODES PARKS & CO, Chartered Accountants, Mumbai as Auditors of the Company to audit the accounts of the Rasayani unit and to audit the consolidated accounts of the company. Further, C&AG under its letter No. CA V/COY/CENTRAL GOVT.HOCL (2)/102 dated 18/ 8/2011 has appointed M/s SASI VIJAYAN & RAJAN, Cochin as Branch Auditors to audit the accounts of Cochin unit for the year ended 31st March, 2012.

The remarks of the Board of Directors on the Auditors' Report to the members are furnished in Annexure IV.

The report of the Comptroller & Auditor General of India under section 619(4) of the Companies Act, 1956, on the Accounts of the Company for 2011-12 is annexed to the Statutory Auditors' Report in the Annual Report.

Pursuant to directions from the Ministry of Company Affairs for appointment of Cost Auditors, Board of Directors of the company appointed M/s V.J.Talati & Co. as the Cost Auditors of Rasayani Unit for 2011-2012 for Sulphuric Acid, Aniline, Formaldehyde, Caustic Soda, Nitro Benzene Products and M/s Panikar & Company as cost Auditors of Kochi Unit for the year 2011-12 for Phenol, Acetone & Polypropylene products .

DIRECTORS

The Tenure of all the Independent Directors had expired in the previous year and as no fresh appointment by the Government of new Independent Directors has been received by the Company, as on 31st March, 2012, there are no Non Official Independent Directors [NOIDs] on the Board of HOCL. However, during May, 2012, Company has received an order from the Govt. of India appointing Dr, N.J.Gaikwad from Nagpur, as Non official part time Director on the Board. We are awaiting the appointment of 4/5 Independent Directors from GOI.

The GOI has appointed vide GOI Order No. 51/05/2009-Ch-III dated 30th April, 2011, Shri J.N. Suryawanshi, CGM(Marketing) HOCL as Director Marketing, HOCL w.e.f. 30th April, 2011, the date of Assumption of Charge.

GOI has appointed Director Shri Suresh Kumar R. , General Manager (Finance), HOCL as Director (Finance) on the Board of HOCL vide GOI Order No. 51/18/2011-Ch-III dated 11th May, 2012 w.e.f.11-05-2012.

GOI has appointed Dr. N.J.Gaikwad, Professor &Head,Deptt. Dept. of Pharmaceutical Science, Rashtrasant Tukadoji Maharaj Nagpur University, for second term as part time non official Director on the Board of HOCL (from the date of assumption of the the charge i.e. from 22nd May, 2012 ) , vide GOI Order No. P.51/011/1/2012-32-Ch-III dated 9th April, 2012.

GOI has appointed Shri S.B. Bhide, Chief General Manager, HOCL as Director (Technical) on the Board of HOCL vide GOI Order No. 51/14/2011-Ch-III dated 14th June, 2012 w.e.f.14-06- 2012.

During the Year, Shri M.K.Mittal has relinquished the charge as Director (Finance), in HOCL on 28th July, 2011,(AN) to enable him to repatriate to his parent Organisation viz. REC Ltd.

With the above position of the Composition of the Board of Directors, the Company is partially complying with the provisions of Clause 49 of the Listing Agreement with Stock Exchanges, as on 31.03.2012.

In terms of Article 76(4) of the Articles of the Association of the Company, Government Nominee Directors, viz. Dr. V. Rajagopalan, Special Secretary &Financial Advisor and Dr. A.J.VaraPrasad, Joint Secretary, will retire at this 51st AGM in 2012 and are eligible for reappointment. Company has received letter dtd.13/08/2012 from the Government reappointing Dr. V. Rajagopalan SS&FA and Dr. A. J. Vara Prasad, JS from ensuing 51st A.G.M. of 2012 and till the holding of the next A.G.M. of the Company to be held in 2013 or till futher Orders.

ACKNOWLEDGMENT

Your Directors gratefully acknowledge the valuable guidance, support and directions given by the Government of India. Your Directors also gratefully acknowledge the support and co- operation extended by the State Governments, by the valued and esteemed customers, shareholders, suppliers, bankers, Statutory/Internal and Tax Auditors, Bondholders, and Investors.

Your Directors place on record their appreciation for the whole hearted efforts and contribution from all the employees and also acknowledge the support and co-operation of the entire Workers' Unions and Employees' Unions and their members for the smooth functioning of the Company's operations.

For and on behalf of the Board of Directors of

Hindustan Organic Chemicals Limited,

Sd/-

Place : Mumbai R. N. Madangeri

Date : 08/08/2012 Chairman & Managing Director

---

Mar 31, 2011

Dear Shareholders

The Directors are pleased to present the 50th Annual Report and the Audited Annual Accounts of the Company for the financial year ended 31st March, 2011.

The financial performance of the Company for the year ended March 31, 2011 is summarized below.

(Rs. in Lacs)

Year ended Year ended

31/03/2011 31/03/2010

Gross Sales 73803.91 52071.24

Operating Profit(Loss) 7235.40 (3456.57)

Less: Interest 2088.35 2323.10

Less: Depreciation 2517.74 2652.28

Profit/(Loss) before tax 2629.31 (8431.95)

Less: Provision for taxation

Less: Prior Period adjustments 57.72 (124.16)

Profit/(Loss) after tax & Prior period 2571.59 (8307.79)

adjustments/ Provisions,

However, in view of accumulated losses as at the end of the Financial Year 2010-11 are carried forward, your Directors do not recommend any dividend on equity shares for the year ended 31 st March, 2011.

RESULTS OF OPERATIONS

During the year under review the Company was able to generate the Net profit of Rs. 25.72 crores during the year, while the Net Loss during the previous year was Rs. 83.08 crores.

As regards the unit wise performance, the Net Profit of Kochi Unit was Rs. 130.08 crores which was much higher as compared to the previous year's profit of Rs.14.74 crores. The Rasayani Unit recorded a Net Loss of Rs. 104.37 crores as compared with the previous year's loss of Rs. 97.82 crores.

OPERATIONS :

During the year under Report, your Company's Kochi unit, achieved a sales turnover of 84082 MTs valuing Rs.58120.81 lacs as against 72172 MTs valuing Rs. 38032.63 lacs of the previous year.

With the production of 234684 MTs (main products) during the year 2010-11 as against the production of 221249 MTs (main products) in 2009-10, your Company could achieve an overall capacity utilization of 58% during the year. Your Company has recorded the sale of 129021.09 MTs during the year (last year 125512.48 MTs) valuing Rs.64142.59 lacs (last year Rs.45940.24 lares).

The high labour cost and high incidence of cost on closed plants at Rasayani unit are the major concerns. Your Company has continued its cost cutting measures to counter these problems and in order to be competitive and improve performance and profitability.

PRODUCTION :

Kochi Unit:

During the year, your Company's Kochi Unit could achieve 166886 MTs of production (main products) which was higher than previous year production (main products) of 137730 MTs. The capacity utilization for the year 2010-11 was 109%.

Rasayani Unit:

During the year, Rasayani unit of your Company could achieve only 67798 MTs (main products) of production as against 83520 MTs production (main products) of the previous year. The capacity utilization for the year 2010-11 was 27%.

MARKETING :

HOC continued to enjoy support from all its valuable customers during the year 2010-11 due to excellent quality of its products manufactured at Kochi and Rasayani. It has achieved sales turnover of Rs.667.36 Crores (net of excise duty) as against Rs. 478.63 crores (net of excise duty) of the previous year. The sales volume during year 2010-11 was 1,45,173.65 MTs against 1,43,747.48 MTs for the year 2009-10, registering an increase in sales realization for the year amounting to Rs. 188.73 crores as compared to previous years sales of Rs. 478.63 crores.

STATUS OF OPERATIONS AND FUTURE PLANS

HOCL has signed the Gas transmission Agreement with M/s GAIL. With the availability of Natural Gas from GAIL, the Company has changed over the feed stock of Hydrogen from Naphtha to Natural Gas to reduce the cost of production. Further for boiler operation, natural gas is used in place of furnace oil to reduce steam cost.

ENERGY CONSERVATION/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions required to be disclosed under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, Technology Absorption and Foreign Exchange Earning and outgo, are given at Annexure II to this Report.

RESEARCH & DEVELOPMENT

R&D continues to do good job in Research. Over the years, it has adopted to changing times and has been contributing with the current needs of the Company by maximum utilization of its existing resources. It has endeavored to generate revenues by way of Royalty through its catalyst development and various developments in processes. To generate revenues through licensing of intellectual property, it has displayed different process technologies developed by the R&D Dept. It is actively involved in research program with Sud-Chemie India Private Limited for re-use of spent catalyst by repelletization of FD catalyst/ Aniline catalyst.

R&D Dept. is developing vapour face process of Kerosene fuel and also accelerated method for in process monitoring of aromatic in Kerosene for ISRO.

HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS:

Company has recognised the importance of human resource and as a plan of upgrading skills and knowledge of the employees, emphasis is continued to be given for training by organising inhouse training programmes and deputing employees to attend training programmes. During the year 2010-11, in all 43 training programmes were conducted, 734 mandays were trained through inhouse training programme, 510.5 mandays were trained by sponsorship (outside) training and 509.5 mandays were trained through on job training.

Thus, total mandays trained were 1754. Further, ISO & computer awareness programmes were conducted for employees. First Aid awareness programmes from outside faculty were also arranged for our employees.

As part of the implementation of ERP in HOCL, Kochi much emphasis was given in imparting training to the employees at Kochi Unit. In Kochi Unit regular Refresher courses were arranged in Safety & ISO implementations. First Aid Recertification course was also arranged during this year.

CORPORATE SOCIAL RESPONSIBILITY

Company right from its inception is conscious about its social responsibilities. To fulfil this, Company is providing basic civic amenities to the neighbouring villages, rendering assistance to the neighbourhood in different forms the details are given hereunder:

Company has provided land to Gulsunda Grampanchayat for construction of cremation shed at Turade village.

Company is giving scholarship to SC/ST students studying in X and XII std. The Company also extends need based assistance to deserving SC/ST students in the nearby villages for their graduation and post graduation.

Company is also extending vocational training facilities to the wards of employees, provides the facilities to carry out project work for students of nearby Engineering Colleges, Management Institutions for enhancing their practical knowledge.

Company has been active in doing peripheral development works for the betterment of villages around the factory area.

HOCL, Kochi Unit has extended support to the initiative taken by the City Police, Kochi towards a fool proof Security to the Citizens and safeguarding the critical installations of Kochi.

Kochi Unit has provided 03 Sodium Vapour Lamps to the newly constructed Bus Stand-cum-shopping complex of Chottanikkara Grama Panchayat.

Kochi Unit has sponsored the READ, Rotary Emplowerment against Aids and Drugs, a project of Rotary International for Higher Secondary School Students. The project was implemented at Govt.

Boys' Higher Secondary School, Tripunithura.

Kochi Unit extended financial support to the family Welfare Programme for the empowerment of Women of Vadavucode Grama Panchayat to supply School Kits for the visually impaired children and Diabetic Awareness Programme of Govt. Ayurveda College, Tripunithura.

PARTICULARS OF EMPLOYEES - INFORMATION REQUIRED

UNDER SECTION 217(2A) OFTHE COMPANIES ACT, 1956

No employee of the Company has drawn the remuneration during the year 2010-11 or any part thereof, in excess of the limits specified under the Companies (Particulars of Employees) Rules 1975.

Accordingly particulars of employees' remuneration prescribed u/sec 217 (2A) of the Companies Act, 1956 are not furnished.

VIGILANCE

The Vigilance Department headed by Chief Vigilance Officer, has two main functional Offices, one at Rasayani (Raigad) in Maharashtra and another at Ambalamugal (Kochi) in Kerala. Keeping in view of the Principles of Corporate Governance, the main focus of the Vigilance department has been to help the sincere, dedicated and honest personnel working in the Organisation to discharge their function effectively and efficiently so that the target of optimum turnover and profitability are achieved in a transparent manner.

The Vigilance department takes prompt action in respect of complaints received. There is a comprehensive complaint handling policy and prescribed punitive action is duly suggested, after conducting fair and impartial investigation/enquiry, where ever required. The Annual Property Returns of the Officers are periodically scrutinized and inspection of various transactions/activities are undertaken to detect deviation, if any, and advise corrective measures. Various Vigilance Awareness Programmes, as per guidelines issued by the CVC, are observed and awareness sessions are conducted for the personnel regarding vigilance related matters as well as in respect of CDA Rules, RTI Act, PIDPI (Whistle Blowers Act) etc. The vigilance department has been instrumental in revising the existing manuals and policies i.e. the Purchase Policy, the Works Policy, the Marketing Manual etc. so that the laid down procedures, policies, rules, regulations etc. of the Company and that of the Central Vigilance Commission are duly followed.

The vigilance department maintains close interaction with CVC, CBI and other government agencies. The personnel working in the vigilance department have undergone training in organization like CBI academy at Ghaziabad, Institute of Secretariat Training & Management at New Delhi etc. The vigilance wing has been sincerely and consistently helping all personnel of the Organisation in improving their efficiency and effectiveness and, in turn, achieving the set goals of the Organisation.

HEALTH, ENVIRONMENT, FIRE & SAFETY Health :

- Physical Check-up, the Special Certificate of Fitness in Form No. 23 and ascertaining Health Status in Form No. 7 of all employees have been carried out by the Certifying Surgeon for the year 2010-2011.

- The Industrial Health Centre is provided at both the Units and is well maintained to provide services and facilities to employees. This Industrial Health Centre is maintained in good order with services and facilities as per scale laid down.

- No complaints are noticed among the employees working in the various plants.

Environment, Fire & Safety:

The Company pays special attention to ensure safety of the factory and workers employed therein.

The Company accords the same priority attention to safety aspects as it does to production and productivity, be it in a personal safety, process safety, environmental safety or product stewardship and allocated adequate resources of men, machine, money, time and energy to maintain the standards. Thus performance during the year is very good. Your Company's both Units could maintain the quality of treated effluent, stack emission and ambient air quality well within the limits stipulated by statutory authorities through out the year.

The Company continued to maintain good safety record without any major accident of Fire. Consistent safety training, safety audit, safety inspection and Hazop studies were performed to keep the safety standard high at both Kochi and Rasayani units.

In order to augment our fire fighting capacity at Kochi unit, mutual aid scheme for emergency help between HOCL, BPCL - KR & FACT (CD) is in existence.

HOCL Rasayani Unit is a signatory to "Responsible Care" movement.

We are committed to the concept of self realization and improvement in all aspects of safety.

Emergency Response Centre (ERC), a voluntary commitment undertaken by Rasayani Unit to tackle emergencies arising out of road transportation of hazardous chemicals is functioning quite well and this effort is acknowledged by general public as well as government authorities.

The Company has made it mandatory to have fire and safety training for all employees.

HOC Kochi unit received safety awards from National Safety Council (Kerala Chapter) and Dept. of Factories & Boilers, Govt, of Kerala for outstanding performance in industrial safety during the year 2010.

Security System :

Kochi Unit of HOCL has been classified as 'MAJOR ACCIDENT HAZARD INSTALLATION' by the Govt, of Kerala. The security requirements are met from the agencies sponsored by the Director General (re-settlement), Ministry of Defense, Govt, of India. Security Guards are posted in the identified areas inside the Factory premises and also in Township round the clock.

In view of the increased threat perception in Kochi, the Unit has been advised to take suitable measures for upgrading the security by the concerned authorities. Action is being taken to upgrade the present security system.

IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY

In compliance of section 3 (3) of the Official Language Act, 1963 and Official Language Rules 1976 framed thereunder, Company has implemented various measures effectively given in the annual programme for 2010-11. All documents coming under Section 3(3) like Part I Orders, Part II Orders, Circulars, Administrative and other Reports, Press-Release etc. were issued bilingually. All Hindi Letters were answered in Hindi only. Our Company participated in all the programmes organized by Mumbai Town Official Language Implementation Committee. Hindi Fortnight was organized at both Rasayani and Kochi Units and in the Corporate Office in Mumbai from 14th September, 2010 to 28th September, 2010. During this period various competitions were organized. Employees actively participated in this competitions. Annual Report of the Company was translated in Hindi and was printed bilingually. Efforts are being made to fulfil the target set in the Annual Programme issued by Department of Official Language, Ministry of Hon. Affairs. Website of the Company is prepared in Hindi also.

At Kochi Unit to comply with the official language Policy of the Government, Workshops on Official language are regularly conducted for the employees who possess working knowledge in Hindi so as to encourage them to use Hindi in their day to day office work. Total 10 workshops were conducted during the Year 2010 in which more than 100 employees were trained.

At Kochi Unit the Official Language Implementation Committee has been constituted for review of the Hindi Implementation at the Unit and the said committee meets regularly.

ISO CERTIFICATION :

HOCL, Rasayani Unit, has been awarded ISO-9001:2008 certificate on 11.01.2011. This certificate has been awarded by M/s Bureau Veritas Certification (India) Pvt. Ltd. and is valid till 9.02.2014. MS of Kochi Unit ISO-9001-2008 is recertified and is valid upto June, 2014. ISO-14001-2004 is valid up to November 2011.

INSURANCE

All properties and insurable interest of the Company including building, plant and machinery and goods are adequately insured. As required under Public liability Insurance Act, 1991 the Company has taken necessary insurance cover.

DEPOSITORY SYSTEM

As the members are aware your Company's shares are tradable compulsorily in electronic form and your Company has established connectivity with both the depositories i.e. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL). In view of the enormous advantages offered by the Depository system, Members are requested to avail the facility of dematerialisation of the Company's shares on either of the depositories as aforesaid.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with the listing agreement, the Management Discussion and Analysis Report is annexed hereto in Annexure V and forms part of the Directors' Report.

CORPORATE GOVERNANCE

The Company has complied with the various requirements of Corporate Governance. The details in this regard form part of this report in Annexure VI.

RESPONSIBILITY STATEMENT

The Directors confirm:

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) that we 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 or loss of the Company for that period;

c) that we have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that we have prepared the annual accounts on a going concern basis.

HINDUSTAN FLUOROCARBONS LIMITED : (Subsidiary)

During the year, the sales turnover was Rs. 3352.42 lacs as against Rs. 1927.06 lacs in the previous year. During the year under report production of PTFE was 124.58 MTs as against 85.88 MTs in the Previous year. Company has achieved 100% capacity utilization of CFM-22 plant and produced 1265 MT as against 940.5 MTs in the previous year. This wilt significantly improve the revenue from CDM.

During the year, 405.49 MT of CFM-22 was sold in the market and balance quantity was used as feed stock to manufacture various products including Fluoro Speciality Chemicals.

STATUS OF CLEAN DEVELOPMENT MECHANISM (CDM) PROJECT AT HFL:

The Company has received first lot of 210142 CERs from UNFCCC. Verification of second lot is in progress and issuance is expected in FY 2011-2012.

The Statement Pursuant to Sec. 212 of the Companies Act, 1956 is given in Annexure I.

AUDITORS

In terms of provisions of Section 619(2) of the Companies Act,1956, the Comptroller & Auditor General of India, under its letter No. CA V/COY/CENTRAL GOVT.HOCL(2)/1172 dated 31/8/2010 has appointed M/s NBS & Co. Chartered Accountants, Mumbai as Auditors of the Company to audit the accounts of the Rasayani Unit and to audit the consolidated accounts of the Company. Vide CAG under its letter No. CA V/COY/CENTRAL GOVT.HOCL(2)/8 dated 12/7/2010 has appointed M/s Sasi Vijayan & Rajan, Cochin as Branch Auditors to audit the accounts of Cochin Unit for the year ended 31 st March, 2011.

The replies of the Management/the Board of Directors on the Auditors Qualification in the Auditors' Report to the members are furnished in Annexure IV

The report of the Comptroller & Auditor General of India under section 619(4) of the Companies Act, 1956, on the Accounts of the Company for 2010-11 is annexed in this Annual Report.

Pursuant to directions from the Ministry of Corporate Affairs for appointment of Cost Auditors, Board of Directors of the Company appointed M/s V.J.Talati & Co. as the Cost Auditors of Rasayani Unit for 2010-2011 for Sulphuric Acid, Aniline, Formaldehyde, Caustic Soda, Nitro Benzene and M/s Panikar & Company as cost Auditors of Kochi Unit for the year 2010-11 for Phenol, Acetone & Polypropylene products.

DIRECTORS

During the year 2010-11, the tenure of Dr. B.D. Kulkarni, & Dr. Sukumar Devotta, Non-Official Independent Directors expired on 27th May, 2010.

Consequent to the superannuation of Shri A.S. Didolkar, CMD, HOCL on 31-8-2010, as per Govt. Order No. 51/14/2009-CH-lll dated 30th August, 2010, and other subsequent Orders, Shri R.N.

Madangeri, D(Tech) has assumed the additional charge of the office of Chairman & Managing Director, Hindustan Organic Chemicals Ltd. (HOCL) in addition to his duties and responsibilities as Director (Tech) up to 31st May, 2011. Further in pursuance of Article 76(1) of the Articles of Association of HOCL vide Govt. Order No.

51/14/2009-CH-lll dated 9th June, 2011, President has appointed Shri R.N. Madangeri, Director (Technical), HOCL as Chairman-cum- Managing Director,(CMD), HOCL for a period of 5 years from the date of assumption of charge on 9th June, 2011 or till date of his superannuation or till further order which ever is the earliest.

The Tenure of other 2 Independent Directors viz. Mr. Madan Verma and Dr. N.J. Gaikwad (NOID) was expired on 7-1-2011.

Later, during the Current Year 2011-12, Shri J.N. Suryawanshi, CGM(Marketing) HOCL, has been appointed as Director (Marketing) w.e.f. 30/04/2011 vide GOI Order No. 51/05/2009-Ch-lll dated 30th April, 2011.

In terms of Article 76(4) of the Articles of the Association of the Company, Government Directors, Shri S.C. Gupta, Joint Secretary and Dr. V. Rajagopalan, Additional Secretary and Financial Advisor, will retire at this 50th AGM in 2011. Company is awaiting for their re- appointment or for further orders on new appointment by the Govt. of India

ACKNOWLEDGMENT

Your Directors gratefully acknowledge the valuable guidance, support and directions given by the Government of India. Your Directors also gratefully acknowledge the support and co-operation extended by the State Governments, by the valued and esteemed customers, shareholders, suppliers, bankers, Statutory / Internal / Cost and Tax Auditors, Bondholders, and Investors.

Your Directors place on record their appreciation for the whole hearted efforts and contribution from all the employees and also acknowledge the support and co-operation of all the Workers' Unions and Employees' Unions and their members for the smooth functioning of the Company's operations.

For and on behalf of the Board of Directors of

Hindustan Organic Chemicals Limited



Place: Mumbai R. N. Madangeri

Date: 18th July, 2011 Chairman & Managing Director

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Mar 31, 2010

The Directors are pleased topresent the 49th Annual Report and the Audited Annual Accounts of the Company for the financial year ended 31st March, 2010.

FINANCIAL HIGHLIGHTS

The financial performance of the Company for the year ended March 31, 2010 is summarized below: Rs.in Lacs

Year ended Year ended 31/03/2010 31/03/2009

Sales and Other Income 52071.24 62090.54

Operating Profit/(Loss) (3456.57) 2316.98

Less: Interest 2323.10 2210.37

Depreciation 2652.28 2680.12

Profit/(Loss) before tax (8431.95) (2573.51)

Less: Provision for taxation - -39.49

Less: Prior Period adjustments (124.16) -85.42 ProfiV(Loss) after tax & Prior period

adjustments/Provisions. (8,307.79) (2527.58)

However, in view of accumulated losses as at the end of the Financial Year 2009-10 are carried forward, your Directors donot recommend any dividend on equity shares for the year ended 31st March, 2010.

RESULTS OF OPERATIONS

During the year uncfer review, the post effects of global melt down during the Year 2009 had adverse impact on the Companys performance. The Company had however taken the best pos- sible measures both in cost reduction as well as in other areas to have a minimal effect of these unavoidable circumstances on its financial performance. In addition to the effects of global melt down, there was statutory necessity of making increased provision for leave encashment of employees Despite this, the Company was able to contain the Net Loss at Rs., 83.08 crores during the year, while the Net Loss during the previous year was Rs. 25.27 crores.

As regards the unit wise performance, the Net Profit of Kochi Unit was Rs. 14.74 crores which was lower as compared to the previous years profit of Rs.20 crores. The Rasayani Unit re- corded a Net Loss of Rs. 97.82 crores as compared with the previous years loss of Rs. 45.28 crores.

OPERATIONS :

During the year under Report, your Companys Kochi unit, achieved a sales turnover of 72171 MTs valuing Rs.38032.63 lacs as against 80210 MTs valuing Rs. 42796.42 racs of the previous year.

With the production of 221249 MTs (main products) during the year 2009-10 as against the production of 245192 MTs {main products) in 2008-09, your Company could achieve an overall capacity utilization of 55% during the year. Your Company has recorded the sale of 125512.48 MTs during the year (last year 132814.79 MTs) valuing Rs.45940.24 lacs (last year Rs.52669.52 lacs).

The high labour cost and high incidence of cost on closed plants at Rasayani unit are the major concerns. Your Company has continued its cost cutting measures to counter these prob- lems and in order to be competitive and improve performance and profitability.

PRODUCTION : Kochi Unit :

"During the year, your Companys Kochi unit could achieve 137730 MTs of production which was marginally less than pre- vious year production (main products) of 164436 MTs. The ca- pacity utilization for the year 2009-10 was 90%.

Basayani Unit :

During the year, Rasayani unit of your Company could achieve only 83519 MTs (main products) of production as against 80756 MTs production (main products) of the previous year. The ca- pacity utilization for the year 2009-10 was 33%.

MARKETING :

HOC continued to enjoy support from all its valuable custom- ers during the year 2009-10 due to excellent quality of its prod- ucts manufactured at Kochi and Rasayani. It has achieved sales turnover of Rs.478.63 Crores (net of excise duty) as against Rs.-546.54 crores (net of excise duty) of the previous year. The sales volume during year 2009-10 was-1,43,747.48 MTs against 1,50,188.69 MTs for the year 2008-09, registering a lower sales realization for the year amounting to Rs. 478.63 crores, which was mainly due to global meltdown and poor price realization.

The company could not export bulk parcels of Phenol during 2009-10 due to un remunerative prices of these products in the export market. The marketing strategy was mainly focused on domestic customers to maximize the market share by adopting flexible marketing-strategies which helped in meeting the threat posed by the importers and the domestic competitors as well.

STATUS OF OPERATIONS AND FUTURE PLANS

1. HOCL has signed the Gas transmission Agreement with M/s GAIL with the availability of Natural Gas-from GAIL, the Company would change the feed stock of Hydrogen from Naphtha to Natural Gas and also for boiler operation in place of furnace oil natural gas would be used. *

2. Further, with- the availability of natural gas, company also plans to put up Captive Power Plant based on Natural Gas to economize on the operation.

ENERGY CONSERVATION/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information in accordance with the provisions required to be. disclosed under Section 217(2) (e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988, regarding conservation of energy, Technology Absorption and Foreign Exchange Earning and outgo, are given at Annexure II to this Report.

RESEARCH & DEVELOPMENT

R&D Division contuinues o deliver goods through innovative developments. Its is actively involved in collab6rative research programme with Sud-Chemie India Private Limited for re-use of spent catealyst by repelletization. This will lead to cost re- duction of the product, and more importantly disposal of the waste catalyst will be possible through green chenustry route. It is also continuing its development work for a specific fuel for ISRO. R&D has also fucused its -activities in creating Intellec-. tual Property Rights by filing ten patents in India and US under PCT.

HUMAN RESOURCE DEVELOPMENT & INDUSTRIAL RE- LATIONS :

Company strongly believes that Human Resources are the only appreciating resources amongst all Other resources. To meet the challenges of global competitive environment, the Com- pany is upgrading the skills of their employees by systemati-

cally identifying training need of employees. Accodingly, in house training programmes are arranged and employees are also de- puted to attend the outside training programmes.

Company continued to implemtn Government Policy of reser- vation for SC/ST. Analysis relating to SC/ST Woment personnel in the Company is given in Annexure-lll.

CORPORATE SOCIAL RESPONSIBILITY :

I. Recognizing the.obligation to the society both in the areas . of environment protection and social development, Com- pany has taken up several initiatives towards implementing welfare Schemes for uplifting the quality of living of the community surrounding the Factory area. To fulfill this, Company is providing basic civic amenities to the neigh- boring villages, rendering assistance to the neighbourhood in different forms viz. financial assistance, building mate- rial, furniture, computers, laboratory equipments etc. to the neighboring schools, construction of approach roads and toilet blocks, drinking water supply, medicines, etc.

II: to promote school education, Company is giving scholar- ship to X and XII Std. Students. Company extends need based assistance to deserving SC/ST students in the nearby villages for their graduate and post graduate education. Company also extends vocational training facilities to the wards to employees, provides the facilities to carry out project work for students studying in nearby Engineering Colleges and Management Institutes for enhancing their practical knowledge.

III. Company has also maintained a hall in thename of Bharatratna Dr. Babasaheb Ambedkar with a view to pro- vide a platform for discussions /seminars / symposiums on principles / teachings of Dr. Babasaheb Ambedkar.

PARTICULARS OF EMPLOYEES - INFORMATION RE- QUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

No employee of the Company has drawn the remuneration during the year 2009-10 or any part thereof, in excess of the limits specified under the Companys (Particulars of Employ- ees) Rules 1975.

Accordingly particulars of employees remuneration prescribed u/sec 217 (2A) of the Companies Act, 1956 are not furnished.

VIGILANCE

The Vigilance wing of HOCL is headed by a Chief Vigilance Officer. At present an IRS officer of 1988 batch, on deputation, is holding the post. Vigilance plays a pivotal role in protecting Governments property. It also ensures that prescribed rules and guidelines are followed by the personnel of HOCL A major thrust of this department has been towards system study and systems improvement to ensure the implementation of the laid down procedures, policies, rules, regulations etc. of the Com- pany and that of the Central Vigilance Commission. As a result of the efforts of vigilance initiatives, new Marketing Policy is approved. Besides, Work Policy and Purchase Policy are also amended to incorporate the latest circulars and guidelines of the Central Vigilance Commission. These policies have been approved by the Board. The Vigilance department takes imme- diate action regarding complaint received from various sources. The Vigilance wing of HOCL is not only prompt in investigation of complaints but also effective in ensuring that action, based on recommendations, is taken against rule violators. The peri- odic and surprise inspections conducted by the Vigilance de- partment have helped in bringing improvements in the field of tendering, transportation, general administration and overall functioning of the organization.

Vigilance department carries out periodic inspections to identify corruption prone areas and take corrective steps in respect of errors / blunders, if any. The Annual Property, Returns of the officers are scrutinized. The Vigilance Wing has ensured that all relevant information regarding Company and especially related to tenders are duly put on the web site to ensure transparency. Awareness programmes have been organized.for the HODs and other personnel.

During Vigilance Awareness Week 2009; efforts were focused on educating employees in respect of relevant circulars and guide- lines of the Commission. Special emphasis was given on the PIDPI or the whistle blower resolution.

The Vigilance Department has been maintaining close liaison with other government agencies i.e. CBI and CVC to ensure that there is no delay in taking appropriate action against any corrupt personnel. The main emphasis of the Vigilance wing has been on the preventive vigilance and system improvement.

The Vigilance wing has helped the management in cost cutting exercise by highlighting the apparent errors and suggesting , solutions. Vigilance wing has taken up many other activities to help the organization.

The Vigilance Personnel have been trained by the CBI / CVO and all of them take keen interest in all activities of the organiza- tion. Thus the Vigilance Wing is sincerely and consistently help- ing all other personnel improve their working and, in turn, en- sure increased productivity.

HEALTH AND ENVIRONMENT (HE) :

1.. The Management has taken the great responsibilities for continuous monitoring and protecting the Health and En- vironment as per statutory compliance of the Maharashtra Factory Rules 1963, especially maintaining the performance of its employees in manufacturing processes of nitro and amino aromatic organic and inorganic bulk chemicals. .

2. The environment is maintained clean as per standard emis- sions norms and with respect to noise pollution norms prescribed by Central Pollution Control Board and under guidelines of Ministry of Environment and Forests, Govt.. of India.

3. The Health record of employees working in Production Division is maintained in the Health Register in Form 7 and these employees are certified for the fitness to work in hazardous process by the Certifying Surgeon for the year 2010 as per Statutory requirement of Director of Industrial Health and Safety, Govt, of Maharashtra.

FIRE & SAFETY PERFORMANCE DURING 2009-2010

The Company pays special attention to ensure safety of the factory and workers employed therein.

The Company accords the same priority attention to safety aspects as it does to production and productivity, be it in a personal safety, process safety, environmental safety or prod- uct stewardship and allocated adequate resources of men, ma- chine, money, time and energy to maintain the standards. Thus performance during the year is very good.

The company continued to maintain good safety record with- out any major accident of Fire. The year 2009 is a Zero acci- dent year as there are no Accidents during the year, which is a record achievement in the history of HOCL, Rasayani Unit. Consistent safety training, safety audit, safety inspection and Hazop studies were performed to keep the safety standard high. The company is taking active participation in Off site Emergency drills, Local and District Crisis group activities. The , Company has conducted NDMA Offsite Mock drill very suc- cessfully which was appreciated by NDMA, DISH, Civil Authori- ties and others.

HOC is a signatory to "Responsible Care" movement. We are committed to the concept of self realization and improvement in all aspect s of safety.

Emergency Response Centre (ERC), a voluntary commitment undertaken by Rasayani unit to tackle emergencies arising out of road transportation of hazafdous chemicals is functioning quite well and this effort is acknowledged by- general public as well as government authorities.

Our employees have bagged maximum awards in zonal level safety competitions. HOC is a major contributor to Mutual aid Response Group - Khopoli, Rasayani, Patalganga zone (MARG- KRAPA),

The Company has made it mandatory to have fire and safety training for all employees.

IMPLEMENTlON OF OFFICIALLANGUAGE POLICY

¦During the year under report, your Company continued its intensive and extensive efforts for progressive use of the official language. To Promote Hindi as Official Language in day to day working in line with the Government policies, Official Lan- , guage Implementation Cell of the Company continued to func- tion effectively. Various Cash Incentive Schemes have been introduced in the Company. Hindi.Workshops are being con- ducted regularly. Official Languagelmplementation Committee meetings are arranged every quarter. Comprehensive programme like HINDI FORTNIGHT was organized at both Rasayani and Kochi units and in the Corporate Office in Mumbai during September, 2009. Several periodical meetings, training programmes, workshops, essay writings, noting and drafting competitions were organized to propagate the use of HINDI. All documents coming under Sec. 3 (3) of the Official Language Act, 1963 are issued in bilingual form. Efforts are being made to fulfill the targets set in the Annual Programme issued by Depart- ment of Official Language, Ministry of Home Affairs. Website of the Company is prepared in Hindi also.

ISO CERTIFICATION :

Quality Management System (QMS) of Rasayani Unit was recer- tified in January, 2008 and we are in the process of upgrading to ISO-9001 : 2008 standards by end November, 2010 as per the requirements of the standards.

GMS of Kochi was upgraded in June 2009 to ISO - 9001 : 2008 standards. This is valid up to June, 2011. ISO - 14001 : 2004 was recertified in October, 2008. This is valid up to November, 2011:

INSURANCE

All properties and insurable interest of the Company including building, plant and machinery and goods are adequately in- sured. As required under Public liability Insurance Act, 1991 the company has taken necessary insurance cover.

FIXED DEPOSITS

The outstanding deposits worth Rs. 18.04 lakhs as on 31.3.2009 have been settled in the year 2009-10 and nothing is remained unpaid as on 31.3.2010.

DEPOSITORY SYSTEM

As the members are aware your companys shares are tradable compulsorily in electronic form and your Company has estab- lished connectivity with both the depositories i.e. National Se- curities Depository Limited (NSDL) and Central Depository Ser- vices (India) Limited (CDSL). )In view of the enormous advan- tages offered by the Depository system, Members are requested to avail the facility of dematerialisation of the Companys shares on either of the depositories as aforesaid.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In accordance with the listing agreement, the Management Dis- cussion and Analysis Report is annexed hereto in Annexure and forms part of the Directors.Report.

CORPORATE GOVERNANCE

The Company has complied with the various requirements of Corporate Governance. The details in this regard form part of this report in Annexure VI

RESPONSIBILITY STATEMENT

The Directors confirm:

a) That in the p/eparation of the annual accounts, the appli- cable accounting standards have been followed and that no material departures have been made from the same;

b) That they have selected such accounting policies and ap- plied them consistently and made judgments and esti- mates 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 ofthe financial year and of. the profit or loss of the company for that period;

c) That they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956, for safe- guarding the assets of the company and for preventing and detecting fraud and other irregularities;

d} That they have prepared the annual accounts on a going concern basis.

HINDUSTAN FLUOROCARBONS LIMITED (Subsidiary) :

During the year under review HFL has achieved production of 85.88 MTs of PTFE & 940.50 MTs of CFM-22 as against 21.73 MTs of PTFE and 890.17 MTs of CFM 22 in the previous year. HFL posted a Net profit Of Rs.306.27 Lakhs in the current year under review as compared to Net profit of Rs. 55.51 lakhs of the previous year. .

STATUS OF CDM

Key Project Mile Stones :

Projeet Registration Date -14.11.2008

Pre-verification meeting at HFL between HFL, SRF & PWC - 29.12.2009

- First Phase Thermal Oxidation-from 15.1.2010to28.2.2010 -Total quantity incinerated is"36.881 MT.

Second phase of Thermal Oxidation - from 22.3.2010 to 28.3.2010 - Total quantity Incinerated is 5.787 MT

Reasons for delay :

The first verification period was permitted by DOE as 14.11.2008 to 28.2.2010 as per UNFCCC. Thus, the verifica- tion exercise could only start in March, 2010.

Prior to verification, the verifier(SGS) has pointed out cer- tain issues with the registered PDD in form of corrective action request/clarification request (CAR/CL) Which needs- to justify. To expedite this activity, meeting was held at SRF, Gurgaon between SRF, HFL and PWC on 17.3.2010. *To . response formulation to CAR/CL raised by DOE require LONG TERM APPROACH TO ENSURE THE CERTAINITY in view CER by document collection so as to response CAR/CL and also addressing larger issues such as revision of monitoring plan of the registered PDD.

As per recent UNFCCC guidelines Part 13 (EB52) it has been made mandatory to public monitoring report on UNFCCC website interface at least two.weeks prior toundertaking the verification site visit. This notification came around Feb,2010.

Considering the above additional activities, enclosed schedule is made.

The audited accounts along with Auditors report and Directors report are appended which are subject to the audit of CAG u/ sec.619(4) of the Companies Act, 1956.

The Statement Pursuant to Sec. 212 of the Companies Act, 1956 is given in Annexure I.

AUDITORS

In terms of provisions of Section 619(2) of the Companies Act, 1956. The Comptroller & Auditor General of India, under its letter No. CA V/COY/CENTRAL GOVT.HOCL(2)/26 dated 12/8/ 2009 has appointed M/s NBS & Co. Chartered Accountants, Mumbai as Auditors of the Company to audit the accounts of the Rasayani unit and to audit the consolidated accounts of the company and M/s. Elias George & Co., Cochin as Branch Auditors to audit the accounts of Cochin unit for the year ended 31st ,March ,2010.

The remarks of the Board of Directors on the Auditors Report to the members are furnished in Annexure IV.

The report of the Comptroller & Auditor General of India under section 619(4) of the Companies Act, 1956, on the Accounts of the Company for 2009-10 is annexed to the Statutory Auditors Report in the Annual Report .

Pursuant to directions from the Ministry of Company Affairs for appointment of Cost Auditors, Board of Directors of the com- pany appointed. M/s V.J.Talati & Co. as the Cost Auditors for Sulphuric Acid for 2009-2010.

DIRECTORS

During the year 2009-10 (w.e.f. 8-12-2009) Shri Mahesh Kumar Mittal has been appointed as Director (Finance), HOCL. Fur- ther, Shri. S.C. Gupta, IAS, Joint Secretary Dept. of Chemical & Petrochemical, Govt, of India has been appointed (w.e.f. 7-01- 2010) as Govt. Nominee Director, in place of Shri. BR Pandey, IAS, Joint Secretary. Later, during the Current Year 2010-11, Dr. V. Rajagopalan, AS&FA has been appointed (w.e.f. 4/5/2010) as Govt. Nominee Director, in place of Shri Mathew C. Kunnumkal,. SS&FA.

In terms of Article 76(4) of the Articles of the Association of the Company, Government Directors, Shri S.C. Gupta, Joint Secretary and Dr. V. Rajagopalan, Additional Secretary and Financial Advisor, will retire at this AGM and are eli- gible for re-appointment as per Government letter dated 6th July 2010.

ACKNOWLEDGMENT

Your Directors .gratefully acknowledge the valuable guidance, support and directions given by the Government of India. Your Directors also gratefully acknowledge the support and co-op- eration extended by the State Governments, by the valued and esteemed customers, shareholders, suppliers, bankers, Statu- tory/Internal and Tax Auditors, Bondholders, and Fixed Deposit holders.

Your Directors place on record their appreciation for the whole hearted efforts and contribution from all the employees and also acknowledge the support and co-operation of all the Work- ers Unions and Employees Unions and their members for the smooth functioning of the Companys operations.

Emergency Response Centre (ERC), a voluntary commitment undertaken by Rasayani unit to tackle emergencies arising out of road transportation of hazardous chemicals is functioning quite well and this effort is acknowledged by general public as well as government authorities.

Our employees have bagged maximum awards in zonal level safety competitions. HOC is a major contributor to Mutual Aid Response Group - Khopoli, Rasayani, Patalganga zone (MARG -KRAPA).

The Company has made it mandatory to have fire and safety training for all employees.

For and on behalf of the Board of Directors of

Hindustan Organic Chemicals Limited.

Place : Mumbai A.S DIDOLKAR

DAte : 13th July 2010 Chairman & MAnaging Director