2. Overall Performance

The Company recorded net sales of H2137.34 Crore
during the financial year 2024-25 as compared to
H2,379.82 Crore in the previous financial year. The Net
Profit during the financial year 2024-25 was H101.31
Crore as compared to a net profit of H231.54 Crore in
financial year 2023-24 translating to Basic Earnings Per
Share at H5.25 for the financial year 2024-25 as against
H12.00 in financial year 2023-24.

3. State of Company's Affairs

The analytical review of the Company's performance
and its businesses, including initiatives in the areas of

Human Resources and Corporate Social Responsibility
have been presented in the section of Management
Discussion and Analysis of this Annual Report.

Electrode Sector

According to data from the World Steel Association,
total global steel production remained largely
unchanged in CY 2024 compared to CY2023, at 1,882.6
mmt versus 1,897.9 mmt, indicating no significant
year-on-year growth.

Steel production outside of China was recorded at
approximately 877.5 mmt in CY2024, broadly in line
with 875.4 mmt in CY2023.

China's steel production declined by 1.7% to 1,005.1
mmt in 2024 from 1,022.5 mmt in 2023, primarily due
to sustained weak domestic demand.

Owing to this, Chinese steel exports increased
significantly to 110.7 mmt in 2024, up from 90.3 mmt
in 2023 and 67 mmt in 2022, thereby intensifying
competitive pressures on global steel producers.

Among major steel-producing regions, the United
States registered a 2.4% decline in production,
totalling 79.5 mmt in 2024 compared to 81.4 mmt
in 2023.

India, now firmly established as the world's
second-largest steel producer, reported a 6.3%
increase in production, reaching 149.6 mmt in 2024,
supported by robust domestic demand—particularly
from the infrastructure and real estate sectors.
It is noteworthy that in India, steel production is
predominantly conducted via the blast furnace route,
with a substantial portion also produced through
induction furnaces, which do not fall within our
customer base.

Owing to subdued industrial and manufacturing
activity, steel prices remained under pressure across
most key consuming markets throughout the year.

Despite ongoing pricing pressures on graphite
electrode demand, the Company operated at a
utilization rate of 77% in 2024-25, the highest among
all western graphite electrode manufacturers.

Needle coke prices remained stable during the year
and expected to remain at similar level for the first half
of 2025-26.

While short-term prospects for graphite electrodes
remain muted—primarily due to geopolitical
uncertainties impacting industrial activity in
developed markets—the long-term outlook remains
positive, driven by the global shift toward EAF-based
steelmaking.

To date, more than 100 mmt of new greenfield
EAF capacity has been announced globally. Of this,
approximately 11 mmt is operational, and an additional
54 mmt is expected to come online between 2025
and 2027.

We anticipate that graphite electrode demand will
gradually increase by 190,000-200,000 mt by 2030,
representing a significant rise over the current Ultra
High Power (UHP) demand (ex-China) of approximately
500,000-600,000 mt.

We remain among the most cost-competitive and
high-quality producers of graphite electrodes
globally. With our extensive customer base, we are
fully prepared to capture emerging opportunities.

Power Generation

The Company has captive power generation capacity
of 86 MW (comprising two thermal power plants and
a hydroelectric power facility).

The thermal plants remained closed for most of the
year 2024-25 due to un-economical price of coal
generated power.

Company currently buys its power needs from MP
state electricity board and hydro power generated is
sold in the market through IEX and bipartite power
purchase agreement with open access to consumers.

The turnover of the Power Segment marginally
decreased to H32.66 crore in FY 2024-25 from H33.83
crore in FY 2023-24.

4. Change in Share Capital

During the FY 2024-25, pursuant to the approval of
Shareholders through Postal Ballot on September 20,
2024, the Authorized Share Capital of the Company
stood sub-divided/ split as per below details:

Authorized Share Capital before sub-division/split:
H70,00,00,000 (Rupees Seventy Crores) divided into:

(a) 5,50,00,000 (Five Crore Fifty Lac) Equity Shares of
H10/- (Rs. Ten) each, and

(b) 15,00,000 (Fifteen Lac) Preference Shares of
H100/- (Rs. One hundred) each.

Authorized Share Capital after sub-division/split:
H70,00,00,000 (Rupees Seventy Crores) divided into:

(a) 27,50,00,000 (Twenty Seven Crores Fifty Lakhs)
Equity Shares of H2/- (Rs. Two) each, and

(b) 15,00,000 (Fifteen Lakhs) Preference Shares of
H100/- (Rs. One Hundred) each.

During the year under review, the Issued, Subscribed
and Paid-up Equity Share Capital of your Company
was re-organized from H38,59,55,060/-(Rupees Thirty
Eight Crore Fifty Nine Lakhs Fifty Five Thousand and
Sixty Only) divided into 3,85,95,506 (Three Crore
Eighty Five Lakhs Ninety Five Thousand Five hundred
and Six Only) Equity Shares of Face Value of H10/-
(Rupees Ten Only) each to H38,59,55,060/-(Rupees
Thirty Eight Crore Fifty Nine Lakhs Fifty Five Thousand
and Sixty Only) divided into 19,29,77,530 (Nineteen

Crore Twenty Nine Lakh Seventy Seven Thousand
Five Hundred Thirty) Equity Shares of Face Value of
H2/- (Rupees Two Only) each due to sub-division/split
of 1 (One) Equity Share of the Company of the face
value of H10/- (Rupees Ten Only) each fully paid into
5 (Five) Equity Shares of the Company of face value of
H2/- (Rupee Two Only) each fully paid up.

5. Material Changes and Commitments

No material changes and commitments affecting
the financial position of the Company have occurred
between the end of the financial year of the Company
to which the financial statements relate and the date
of the report.

6. Change in the Nature of Business

There is no change in the nature of business during
the financial year 2024-25.

7. Significant Developments

The Board of Directors of the Company at its meeting
held on 22 May 2024 had approved the Composite
Scheme of Arrangement amongst HEG Limited ("the
Company") and HEG Graphite Limited ("Resulting
Company") and Bhilwara Energy Limited ("Transferor
Company") and their respective shareholders and
creditors ("Scheme").

The proposed Scheme inter alia provides for:

(a) the demerger of the Demerged Undertaking
(i.e. Graphite Business) from the Company into
the Resulting Company on a going concern
basis and issue of equity shares by the Resulting
Company to the shareholders of the Company in
consideration thereof, and

(b) amalgamation of the Transferor Company with
the Company and issue of equity shares by the
Company to the shareholders of the Transferor
Company (except the Company itself) in
consideration thereof. The Appointed Date for
the Scheme is 1^st April 2024.

Thereafter, the Company had filed the requisite
application with the stock exchanges (viz. BSE Limited
and National Stock Exchange of India Limited) under
Regulation 37 of the listing Regulations ("Regulation
37 Application").

Taking into consideration the business needs, the
board of directors of the Transferor Company vide
its resolution dated 10 March 2025 has approved the
execution of definitive agreements in connection with
the issue of further shares to proposed investors.

In view of the aforesaid, the companies involved in
the Scheme have modified the Scheme basis SEBI's
observation, after taking into account, inter alia, the
updated valuation reports issued by the registered
valuer and fairness opinion issued by the merchant
banker on the modified scheme.

The Company has thereafter filed fresh Regulation 37
application with the stock exchanges in relation to the
modified Scheme. The Scheme is, inter alia, subject to
receipt of approval from the statutory and regulatory
authorities, including BSE Limited, National Stock
Exchange of India Limited, jurisdictional National
Company Law Tribunal and the shareholders and
creditors (as applicable) of the Companies involved in
the Scheme.

Pending receipt of final approvals, no adjustments
have been made in the financial results for the year
ended 31^st March 2025.

8. Subsidiary, Associate Companies or Joint Ventures

a) Subsidiary Company

The Company has the following 3 (Three) Wholly
Owned Subsidiaries (WOS):

i. TACC Limited

TACC Limited had no business operations during
the financial year 2024-25 and Net Loss was
H0.21 Crore.

ii. HEG Graphite Limited

HEG Graphite Limited had no business operations
during the financial year 2024-25 and Net Loss
was H0.04 Crore.

iii. Bhilwara Infotechnology Limited

Bhilwara Infotechnology Limited had a
consolidated turnover (Revenue from
Operations) of H25.37 crore and Profit after Tax
was H0.87 crore as per their audited consolidated
financial statements for the financial year ended
31^st March, 2025.

In terms of provisions of Section 136(1) of the
Companies Act, 2013, the audited financial
statements of TACC Limited, HEG Graphite
Limited and Bhilwara Infotechnology Limited
WOS of HEG Limited, have been placed on the
website of the Company and are not being
annexed in this Annual Report.

The financial statements of the subsidiary
companies are kept for inspection by the
shareholders at the registered office of the

Company. The Company shall provide, the copy
of the financial statements of its subsidiary
companies to the shareholders free of cost upon
their request.

The Managing Director of the Company does not
receive any remuneration or commission from its
subsidiary except the sitting fee.

b) Associate Companies or Joint Ventures

There is One Associate of the Company namely
Bhilwara Energy Limited.

Bhilwara Energy Limited had a consolidated turnover
(Revenue from Operations) of H577.71 crore and
Net Profit (attributable to owners of the parent) was
H32.18 crore as per their audited consolidated financial
statements for the financial year ended 31^st March, 2025.

The Company has no Joint Ventures.

During the FY 2024-25, Bhilwara Infotechnology
Limited ("BIL") an associate company have become
the Wholly Owned Subsidiary Company pursuant
to purchase of the remaining shares of BIL by the
Company from the existing shareholders of BIL.

No Company has become/ceased to be Joint Venture
during the financial year 2024-25.

Performance of Associate Company & Subsidiary
Companies and their contribution to overall
performance of the Company has been mentioned in
the Notes to Accounts to the consolidated financial
statements.

Pursuant to the provisions of Section 129(3) of the
Companies Act, 2013, a statement containing the
salient features of financial statements of subsidiary
and associate companies is annexed in the Form
AOC-1 to the consolidated financial statements and
hence not repeated here for the sake of brevity.

9. Consolidated Financial Statements

The Consolidated Financial Statements have been
prepared by the Company in accordance with
applicable provisions of the Companies Act, 2013,
Accounting Standards and SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015.
The audited consolidated financial statements
together with Auditors' Report form part of the Annual
Report. The Auditor's Report does not contain any
qualification, reservation or adverse remarks.

10. Dividend

Your Directors are pleased to recommend a final
dividend at the rate of H1.80/- per equity share on

19,29,77,530 equity shares of face value of H2 each
for the financial year ended 31^st March, 2025 subject
to the approval of the Shareholders at the ensuing
53^rd Annual General Meeting (AGM) of the Company.
The dividend, if declared by the Shareholders in the
AGM will be subject to deduction of tax at source at
applicable rates.

As per Regulation 43A of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015,
the Dividend Distribution Policy is attached as
Annexure-IV, which form part of this report and is also
available on the website of the Company.

11. Corporate Governance

A report on Corporate Governance forms part of
this Report along with the Auditors' Certificate
on Corporate Governance as required under SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015. The Auditors' Certificate for
the financial year 2024-25 does not contain any
qualifications, reservations or adverse remarks.

12. Management Discussion and Analysis

Management Discussion and Analysis Report as
required under the SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015 forms
part of the Annual Report.

13. Business Responsibility & Sustainability Report
(BRSR)

As per Regulation 34 of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015,
a Business Responsibility & Sustainability Report
describing the initiatives taken by the Company from
an environmental, social and governance perspective
is attached as part of the Annual Report.

14. Internal Control / Internal Financial Control
Systems and Adequacy Thereof

The Company has an adequate internal control
system commensurate with the size and nature of its
business. An internal audit programme covers various
activities and periodical reports are submitted to the
top management. The Company has a well-defined
organisational structure, authority levels and
internal rules and guidelines for conducting business
transactions.

Further, the Internal Financial Control framework is
under consistent supervision of Audit Committee,
Board of Directors and also Independent Statutory
Auditors. During the year, no reportable material
weakness in the design or operations was observed.

15. Personnel

a) Industrial relations

The industrial relations during the period under review
generally remained cordial at all the plants of the
Company.

b) Particulars of employees

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

16. Public Deposits

Your Company has not invited any deposits from
public/ shareholders in accordance with Chapter V of
the Companies Act, 2013.

17. Significant and Material Orders Passed By the
Regulators or Courts or Tribunals

There were no significant material orders passed by
the Regulators/Courts/Tribunals during the financial
year 2024-25 which would impact the going concern
status of the Company and its future operations.

18. Conservation Of Energy, Technology Absorption,
Foreign Exchange Earnings and Outgo

The information with regard to Conservation of
Energy, Technology Absorption, Foreign Exchange
Earnings and Outgo in accordance with the provisions
of Section 134(3)(m) of the Companies Act, 2013 read
with Rule 8 of the Companies (Accounts) Rules, 2014,
is given as Annexure-II forming part of this Report.

19. Directors and Key Managerial Personnel
i. DIRECTORS

(a) Appointment/ Cessation

Dr. Nand Gopal Khaitan (DIN: 00020588),
Shri Sandip Somany (DIN: 00053597) and
Shri Priya Shankar Dasgupta (DIN: 00012552)
were appointed as Independent Directors by
the Shareholders through Postal Ballot on
September 20, 2024 for a period of first term of
five consecutive years w.e.f. August 13, 2024 till
August 12, 2029 (both days inclusive).

Shri Manish Gulati (DIN:08697512) was
re-appointed by the shareholders as Whole Time
Director designated as Executive Director, liable
to retire by rotation in terms of Sections 152 of
the Act, through Postal Ballot on December 27,
2024 for a period of five years with effect from
March 1,2025 to February 28, 2030. Shri Manish

Gulati, will continue to act as Key Managerial
Personnel of the Company in terms of Section
2(51) of the Companies Act, 2013 and rules
thereto.

Shri Jayant Davar (DIN: 00100801) was re¬
appointed as an Independent Director in 52^nd
AGM held on 7^th August, 2024 for the second
term of five consecutive years with effect from
14^th August, 2024 upto 13^th August, 2029.

Shri Davinder Kumar Chugh, Independent
Director, resigned from the Board with effect
from May 22, 2024.

Dr. Kamal Gupta has completed his second term
as Independent Director on August 29, 2024.
Dr. Kamal Gupta was appointed as Non-Executive
Non-Independent Director w.e.f. November 14,
2024 and the Shareholders have approved the
same through Postal Ballot on December 27, 2024.

(b) Retire by Rotation/Continuation of Director

Shri Riju Jhunjhunwala (DIN: 00061060) and
Shri Shekhar Agarwal (DIN: 00066113) shall
retire by rotation at the ensuing Annual General
Meeting and being eligible, offer themselves
for re-appointment. The Board hereby
recommends their re-appointment for approval
of shareholders in the ensuing Annual General
Meeting.

Smt. Vinita Singhania (Presently Aged: 73 Years
2 Months) (DIN: 00042983), Director of the
Company will attain the age of 75 years in FY
2026-2027, therefore upon the recommendation
of Nomination & Remuneration Committee,
the Board has recommended continuation
of Smt. Vinita Singhania (DIN: 00042983) as
Non-Executive Non-Independent Director
subject to approval of shareholder by passing
special resolution pursuant to Regulation 17(1A)
of SEBI (LODR) Regulations, 2015.

The Board confirms that independent directors
appointed during the year possess the desired integrity,
expertise and experience. The Independent Directors
of the Company stated that they are in compliance
with the Section 150 of the Companies Act, 2013 read
with Rule 6 (1) & (2) of the Companies (Appointment &
Qualification of Directors) Rules, 2014.

All Independent Directors have given declarations that
they meet the criteria of independence as laid down
under Section 149(6) of the Companies Act, 2013

and Regulation 16 of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations,
2015. They have also complied with the Code for
Independent Directors prescribed in Schedule IV of
the Companies Act, 2013.

In the opinion of Board, Independent Directors fulfil
the conditions specified in the Companies Act, 2013
read with schedules and rules thereto as well as the
SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 and Independent Directors are
independent of management.

The Company has a Code of Conduct for the Directors
and Senior Management Personnel. This Code is
a comprehensive code applicable to all Directors
and members of the Senior Management. A copy of
the Code has been put on the Company's website
www.hegltd.com.

The brief profile, pursuant to Regulation 36 of the SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015 and Secretarial Standards-2, of the
Directors eligible for appointment/re-appointment
forms part of the Notice of Annual General Meeting
and Corporate Governance Report.

ii. KEY MANAGERIAL PERSONNEL

The following are the Key Managerial Personnel of the
Company as on 31^st March, 2025:

a) Shri Ravi Jhunjhunwala, Chairman, Managing
Director & CEO

b) Shri Manish Gulati, Executive Director

c) Shri Ravi Kant Tripathi, Chief Financial Officer

d) Shri Vivek Chaudhary, Company Secretary

20. Board Evaluation

The Board has carried out an annual evaluation of its
own performance, the Directors individually as well
as the evaluation of the working of its Committees,
in the manner as enumerated in the Nomination and
Remuneration Policy, in accordance with the provisions
of the Companies Act, 2013 and the SEBI (Listing
Obligations and Disclosure Requirements) Regulations,
2015. The evaluation exercise covered various aspects
of the Board's functioning such as composition of the
Board & Committee(s), their functioning & effectiveness,
contribution of all the Directors and the decision
making process by the Board.

Your Directors express their satisfaction with the
evaluation process and inform that the performance of
the Board as a whole, its Committees and its member
individually were adjudged satisfactory.

21. Nomination and Remuneration Policy

The Nomination & Remuneration Policy of the
Company is in place and is attached as Annexure-III
to this Report.

22. Meetings of the Board

The Board of Directors met seven times in the financial
year 2024-2025 through Physical Meeting / Video
Conferencing as permitted by relevant MCA circulars
& SEBI Circulars read with Rule 3 of the Companies
(Meetings of Board and its Powers) Rules, 2014 under
provisions of the Companies Act, 2013. The intervening
period between any two consecutive Board Meetings
was within the maximum time gap prescribed under
the Companies Act, 2013, Regulation 17 of the SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015 and SS-1 issued by ICSI. The details
of the Board Meetings and the attendance of the
Directors are provided in the Corporate Governance
Report.

23. Contracts and Arrangements with Related Parties

The Board of Directors of the Company, acting upon
the recommendation of its Audit Committee of
Directors, has approved the policy and procedures
with regard to Related Party Transactions for
reviewing, approving and ratifying Related Party
transactions and in providing disclosures with
respect to the above transactions, as required under
the Companies Act, 2013, SEBI (Listing Obligations
Disclosure Requirements) Regulations, 2015 ("Listing
Regulations") as amended from time to time and other
applicable provisions, rules and regulations made
thereunder.

All related party contracts/arrangements/ transactions
that were entered into during the financial year were
on an arm's length basis and were in the ordinary
course of business.

All Related Party Transactions are placed before
the Audit Committee for approval. Prior omnibus
approval of the Audit Committee was obtained for
the transactions which are of a foreseen and repetitive
nature. The statement of transactions entered into

pursuant to the omnibus approval so granted is
placed before the Audit Committee for approval on
a quarterly basis. The statement is also supported
by a Certificate from the Internal Auditor and Chief
Financial Officer.

The updated policy on Related Party Transactions as
approved by the Board is uploaded on the Company's
website, the weblink of which is as under:
https://hegltd.com/wp-content/uploads/2022/05/
HEG_RPT-Policy_09.02.2022.pdf

There are no pecuniary relationships or transactions
of Non-Executive Directors vis-a-vis the Company
that have a potential conflict with the interests of the
Company.

In terms of Regulation 23 of the SEBI (Listing Obligations
and Disclosure Requirements) Regulations, 2015, the
Company has submitted the half yearly disclosure of
related party transactions to the BSE Ltd. and National
Stock Exchange of India Ltd.

Since No material Related Party Transactions were
entered during the financial year of the Company.
Accordingly, the disclosure of Related Party
Transactions as required under Section 134(3)(h) of the
Companies Act, 2013 in Form AOC-2 is not applicable.

24. Committees of the Board

The Board has following statutory committees:

• Audit Committee

• Nomination and Remuneration Committee

• Stakeholders Relationship Committee

• Corporate Social Responsibility Committee and
ESG Committee*

• Risk Management Committee

*Name of Corporate Social Responsibility Committee has
been changed as "Corporate Social Responsibility and ESG
Committee” with effect from February 11,2025.

Details of all the committees, along with their charters,
composition and meetings held during the year, are
provided in the Report on Corporate Governance, as
part of this Annual Report.

All the recommendations of the Committees were
accepted by the Board during the financial year
2024-25.

25. Auditors

M/s SCV & Co LLP having (Firm Registration No-
000235N/N500089), Chartered Accountants, the
Statutory Auditors of the Company had been re¬
appointed as the Statutory Auditors for a second
term of 5 consecutive years from the conclusion of 50^th
Annual General Meeting (AGM) held on 1^st September,
2022 till conclusion of 55^th AGM of the Company,
on such remuneration as may be mutually agreed
between the Board of Directors of the Company and
the Statutory Auditors from time to time.

Further the Auditors have confirmed their eligibility
under Section 141 of the Companies Act, 2013 read
with rules made thereunder.

The Auditors' Report read along with Notes to
Accounts is self-explanatory and therefore does not
call for any further comments.

The Auditors' Report does not contain any qualification,
reservation or adverse remark.

No fraud has been reported by the Statutory Auditors
under Section 143(12) of the Companies Act, 2013 and
the rules made thereunder.

26. Cost Auditors

In terms of sub-section (1) of Section 148 of the
Companies Act, 2013 read with the Companies (Cost
Records and Audit) Rules, 2014, as amended from time
to time, the Company is required to maintain the cost
records. Accordingly, such accounts and records have
been maintained by the Company.

The Cost Audit for financial year ended 31^st March, 2024
was conducted by M/s. N.D. Birla & Co. (M. No. 7907). The
said Cost Audit Report was filed on 10^th September, 2024.

No fraud has been reported by the Cost Auditors
under Section 143(12) of the Companies Act, 2013 and
the rules made thereunder.

Based on the recommendation of Audit Committee
at its meeting held on 19^th May, 2025, the Board has
approved the re-appointment of M/s. N.D. Birla & Co.
(M. No. 7907), as the Cost Auditors of the Company
for the financial year 2025-2026 on a remuneration
of H3,00,000/- plus applicable taxes and out of pocket
expenses that may be incurred by them during the
course of audit.

As required under the Companies Act, 2013, the
remuneration payable to the Cost Auditor is required
to be placed before the Members in a general meeting
for their ratification. Accordingly, a resolution seeking
Member's ratification for the remuneration payable to
M/s. N.D. Birla & Co., Cost Auditors is included in the
Notice convening the ensuing Annual General Meeting.

27. Secretarial Auditor

Pursuant to the provisions of Section 204 of the
Companies Act, 2013 read with the Companies
(Appointment and Remuneration of Managerial
Personnel) Rules, 2014 and Regulation 24A of the SEBI
(Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Company had appointed
M/s. GSK & Associates, a firm of Company Secretaries
in Practice to undertake the Secretarial Audit of the
Company for the financial year 2024-25. The Secretarial
Audit Report is annexed herewith as Annexure-V.

No fraud has been reported by the Secretarial Auditors
under Section 143 (12) of the Companies Act, 2013 and
the rules made thereunder.

Further, in terms of the SEBI (Listing Obligations
& Disclosure Requirements) (Third Amendment)
Regulation, 2024, the Board upon the recommendation
of Audit Committee has recommended appointment
of M/s. GSK & Associates as the Secretarial Auditors of
the Company for a term of five consecutive financial
years commencing from the financial year 2025-26 till
the financial year 2029-30. The appointment will be
subject to shareholder's approval at the ensuing AGM
and therefore is included in the notice convening the
ensuing Annual General Meeting.

28. Qualification, Reservation or Adverse Remark in
the Audit Reports

There is no qualification, reservation or adverse remark
made by the Statutory or Cost or Secretarial Auditors
in their Audit Reports issued by them.

29. Business Risk Management

The objective of risk management at the Company is
to protect shareholders value by minimizing threats or
losses, and identifying and maximizing opportunities.
An enterprise-wide risk management framework is
applied so that effective management of risk is an
integral part of every employee's job.

The Risk Management Policy of the Company is in
place. The Company's risk management strategy is
integrated with the overall business strategies of
the organization and is communicated throughout
the organization. Risk management capabilities aide
in establishing competitive advantage and allow
management to develop reasonable assurance
regarding the achievement of the Company's
objectives.

The annual strategic planning process provides
the platform for identification, analysis, treatment
and documentation of key risks. It is through this
annual planning process that key risks and risk
management strategies are communicated to
the Board. The effectiveness of risk management
strategies is monitored both formally and informally
by management and process owners. There is no
major risk which may threaten the existence of the
Company.

The Company has duly constituted Risk Management
Committee inter-alia to oversee Risk Management
framework of the Company. The details pertaining to
the composition, meetings and terms of reference of
the Risk Management Committee are included in the
Report on Corporate Governance which forms part of
the Annual Report.

30. Corporate Social Responsibility (CSR)

As part of its initiatives under Corporate Social
Responsibility (CSR), the Company has undertaken
CSR projects directly and/or through implementation
agencies in the areas of promotion of education,
eradicating hunger & poverty, initiatives towards
Community Service and Rural Development,
Healthcare, Plantation & Environment Development,
Protection of National heritage, Art, Culture etc.
These projects were in accordance with the CSR Policy
of the Company and Schedule VII of the Companies
Act, 2013.

The Company has a policy on CSR and has constituted
a CSR Committee for undertaking CSR activities.
The Composition of Committees & other details are
provided in the Corporate Governance Report which
forms part of the Annual Report. During the year,
the name of CSR Committee has been changed to
Corporate Social Responsibility and ESG Committee
and also new members from Board have been inducted
in the Committee. Shri Manish Gulati, Executive
Director will also act as Chief Sustainability Officer.

The CSR policy may be accessed on the Company's
website at the link mentioned below:
https://hegltd.com/wp-content/uploads/2021/06/
amended-csr-policy.pdf

The various CSR projects inter-alia undertaken
will bring qualitative changes in the lives of the
community around the plant location. One of the
Key project is that the Company has established first
mega kitchen "Akshaya Patra" in MP- Akshaya Patra
in Bhopal. The Kitchen has been serving meals to
900 schools feeding 50,000 children every day under
Central and MP Government Mid Day Meal Scheme
and number of meal served till today is 1.60 Crores .
Another key project is the empowerment of farmers
by encouraging farmers to change to fruit cropping
under NGO called Global Vikas Trust in the states of MP
and Maharashtra which is resulting in improvement
in their income between 8 to 10 times resulting in
bringing them out of poverty and higher familial
and societal status. The Company also runs Graphite
school at Mandideep, Bhopal, which is CBSE affiliated
and run by the Trust funded by the Company and is
a testament to our commitment to education and
community welfare. It has a modern facility that offers
a superior educational environment for approximately
1,900 students.

The Annual Report on CSR activities as required under
the Companies (Corporate Social Responsibility Policy)
Rules, 2014 is enclosed as Annexure-VI, forming part
of this report.

31. Internal Auditors

Pursuant to the provisions of Section 138 of
the Companies Act, 2013 and based on the
recommendation of Audit Committee, the Board has
approved the re-appointment of M/s. S.L. Chhajed &
Co. LLP, as the Internal Auditors of the Company for
the financial year 2025-2026.

32. Directors Responsibility Statement
The Directors confirm that:

i) In preparation of the annual accounts, the
applicable accounting standards have been
followed and there are no material departures
from the same;

ii) They have selected such accounting policies and
applied them consistently and made judgements
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 2024-25 and of the profit of the Company
for the year under review;

iii) They have taken proper and sufficient care for
maintenance of adequate accounting records in
accordance with the provisions of the Companies
Act, 2013 for safe guarding the assets of the
Company and for preventing and detecting
frauds and other irregularities;

iv) They have prepared the annual accounts on a
going concern basis;

v) They have laid down internal financial controls
to be followed by the Company and that such
internal financial controls are adequate and are
operating effectively; and

vi) They have devised proper systems to ensure
compliance with the provisions of all applicable
laws and that such systems are adequate and
operating effectively.

33. Vigil Mechanism /Whistle Blower Policy

The Company has a vigil mechanism named
"Whistle Blower Policy", which is overseen by the
Audit Committee. The Policy inter-alia provides
safeguards against victimization of the Whistle Blower.
Employees and other stakeholders have direct access
to the Chairperson of the Audit Committee for lodging
concerns if any, for review. The policy is posted on
the website of the Company, the web link of which is
as under:

https://hegltd.com/wp-content/uploads/2018/07/

Whistle-Blower-Policy-08.05.2018.pdf

34. Particulars of Loans, Guarantees or Investments

Details of Loans, Guarantees and Investments covered
under the provisions of Section 186 of the Companies
Act, 2013 form part of the notes to the financial
statements provided in the Annual Report.

35. Investor Education and Protection Fund (IEPF)

As required under Section 124 of the Companies
Act, 2013 the unclaimed interim dividend amount
aggregating to H80.21 Lakh lying with the Company
for a period of seven years pertaining to the financial
year ended on 31^st March, 2018, was transferred
during the Financial Year 2024-25, to the Investor
Education and Protection Fund established by
the Central Government. The details of same are
given in Corporate Governance Report under head
Shareholder Information.

36. Insider Trading

In compliance with the Securities and Exchange Board
of India (Prohibition of Insider Trading) Regulations,
2015 (Regulations), your Company has adopted the
following-

i) Code of Conduct for Regulating, Monitoring and
Reporting of Trading by Insiders- The said Code
lays down guidelines, which advise Insiders on
the procedures to be followed and disclosures
to be made in dealing with the shares of the
Company and cautions them on consequences
of non-compliances.

ii) Code of Practices and Procedures of Fair
Disclosures of Unpublished Price Sensitive
Information- The Code ensures fair disclosure of
events and occurrences that could impact price
discovery in the market.

iii) Policy for dealing with Unpublished Price
Sensitive Information (UPSI) and Whistle Blower
Policy for employees to report any leak or
suspected leak of UPSI- The policy aims to enable
the employees of the Company to report any leak
or suspected leak of UPSI, procedures for inquiry
in case of leak of UPSI or suspected leak of UPSI
and initiate appropriate action and informing the
SEBI promptly of such leaks, inquiries and results
of such inquiries.

iv) Internal Control Mechanism to prevent Insider
Trading- The Internal Control Mechanism
is adopted to ensure compliances with the
requirements given in the regulations and to
prevent Insider Trading. The Audit Committee
also review compliance with the provision of
regulations periodically.

37. Annual Return

In terms of the Section 92 (3) of Companies Act, 2013
as amended, the Annual Return of the Company is
placed on the website of the Company
https://hegltd.com/annual-general-meeting

38. General Disclosure

a) The Company has maintained Cost Records in
accordance with Section 148(1) of the Companies
Act, 2013.

b) The Company has a group policy in place against
Sexual Harassment in line with the requirements
of the Sexual Harassment of Women at the
Workplace (Prevention, Prohibition & Redressal)
Act, 2013. Internal Complaints Committee (ICC)

has been set up to redress complaints received
regarding sexual harassment. The Company
has complied with the provisions of above
said act. The Company has undertaken 23
workshops or awareness programmes against
sexual harassment of women at the workplace.
No complaint of Sexual Harassment was received
during the financial year 2024-25.

c) The Company is in compliance of all applicable
secretarial standards issued by The Institute of
Company Secretaries of India from time to time.

d) The details of difference between amount of
the valuation done at the time of one-time
settlement and the valuation done while taking
loan from the Banks or Financial Institutions
along with the reasons thereof: Not Applicable.

e) The details of application made or any
proceeding pending under the Insolvency and
Bankruptcy Code, 2016 (31 of 2016) during the
year along with their status as at the end of the
financial year: Not Applicable.

39. Key Initiatives with respect to Stakeholder
relationship, Customer relationship, Environment,
Sustainability, Health and Safety

The Company has duly constituted Stakeholders
Relationship Committee with broad terms of
reference, the details of which is provided in the
Corporate Governance Report which forms part of the
Annual Report.

As a responsible corporate citizen, the Company
supports the 'Green Initiative' undertaken by the
Ministry of Corporate Affairs, Government of India,
enabling electronic delivery of documents including
the Annual Report etc. to shareholders at their e-mail
address registered with the Depository Participants
and Registrar & Transfer Agent.

To support the 'Green Initiative' and in compliance
of Rule 18 of the Companies (Management and
Administration) Rules, 2014, as amended from time
to time, Members who have not yet registered their
email addresses or want to update a fresh email
id are requested to register the same with their
Depository Participant in case the shares are held
by them in electronic form and with Company's
Registrar & Transfer Agents (RTA) in case the shares
are held by them in physical form for receiving all
communications, including Annual Report, Notices,
Circulars, etc., from the Company electronically.

The Company has also sent the communication to the
concerned shareholders with regard to registration of
their email address etc. with the Registrar and Share
Transfer Agent/ Depository Participants in connection
with service of documents through electronic mode.

Further, as permitted by MCA Circulars and SEBI
Circulars issued from time to time, the Notice of the
53^rd AGM and the Annual Report of the Company for
the financial year ended 31^st March, 2025 including
therein the Audited Financial Statements for the year
2024-25, are being sent only by email to the Members.

The Company remained agile to emerging market
opportunities by remaining connected with all its
customers across the lean period. This effort allowed
it to improve its capacity utilization better than most
peers in this space. A higher utilization helped in
better absorption of costs which improved cash flow.
The Company stays in contact with its customers
on a regular basis. The IT department is developing
solutions for increased transparency in business
operations and better connectivity with customers.

The Company is committed to protecting the
environment. The R&D team works closely with some
reputable research institutes to develop environment

friendly approaches for sustainable growth which
involves identifying alternative/ regenerative carbon
feedstock.

The Company supports the principles of inclusive
growth and equitable development through not
just its corporate social responsibility initiates but
through its core business as well. The Company's
social upliftment initiatives focus around healthcare,
education, removing hunger, community
development and environmental conservation, which
facilitates in bettering lives and improving livelihood,
amongst others.

40. Acknowledgements

Your Directors wish to place on record, their
appreciation for the valuable assistance and support
received by your Company from banks, financial
institutions, the Central Government, the Government
of Madhya Pradesh, the Government of Uttar Pradesh
and their departments. The Board also thanks the
employees at all levels, for the dedication, commitment
and hard work put in by them. The Directors appreciate
and value the contribution made by every member of
the HEG family.

For and on behalf of the Board of Directors
Ravi Jhunjhunwala

Date: 19^th May, 2025 Chairman, Managing Director & CEO

Place: Noida (U.P.) DIN: 00060972