HMT Limited has received a fine of Rs. 14,23,080 from both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) for failing to comply with various provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR Regulations). The fine pertains to violations related to the composition of the Board of Directors and Committees, along with issues related to quorum for Board and Committee meetings during the quarter ending December 31, 2024.

Non-Compliance Details

The company was found to be non-compliant with several SEBI regulations, including:

• Regulation 17(1): Requires the composition of the board to have at least one-third independent directors.
• Regulation 17(2A): Pertains to the appointment of an independent director on the board.
• Regulation 18(1): Relates to the composition of the Audit Committee.
• Regulation 19: Pertains to the Nomination and Remuneration Committee.
• Regulation 20: Concerns the Stakeholders’ Relationship Committee.
• Regulation 21(2): Addresses the Risk Management Committee.

The primary issue cited was that there were no independent directors on the board of HMT Limited, which is a requirement under these regulations.

Steps Taken by HMT Limited

HMT Limited, which is a Government Company, has stated that all directors are appointed by the Government of India under the company’s Articles of Association. In light of this, the company has formally requested the Administrative Ministry to appoint the required number of Independent Directors, including one Independent Woman Director, to comply with the aforementioned SEBI regulations.

Application for Waiver

In addition, HMT Limited has begun the process of applying for a waiver of the imposed fines. The SOP Circular issued by the Stock Exchanges allows for the possibility of such waivers, and the company is actively pursuing this option.

The fine of Rs. 14.23 lakh (inclusive of GST) was imposed due to the non-compliance for the quarter ended December 31, 2024, specifically related to the Board composition and quorum issues. The company is taking steps to ensure full compliance with all necessary SEBI regulations and is working with the Government of India to resolve the matter swiftly.

About HMT Limited

HMT Limited is one of the oldest and most reputed Government of India undertakings, primarily engaged in the manufacturing of industrial machinery, clock and watch manufacturing, and precision engineering products. The company’s corporate office is located in Bengaluru, Karnataka.

As a public sector company, HMT is governed by the regulations and guidelines set by the Government of India. The company has been making concerted efforts to restructure and modernize its operations to remain competitive in a rapidly evolving industrial landscape.

The imposition of the fine highlights the importance of regulatory compliance for all companies listed on stock exchanges, particularly concerning the composition of their boards and adherence to the provisions of SEBI’s LODR regulations.

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