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You can view full text of the latest Director's Report for the company.

BSE: 500048ISIN: INE258A01016INDUSTRY: Auto - Construction Vehicles

BSE   ` 3183.50   Open: 3213.15   Today's Range 3176.45
3215.55
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4139.40
Year End :2023-03 

Your Board of Directors has pleasure in presenting 59th Annual Report of the Company along with Audited Financial Statement for the year ended 31.03.2023 as under:

Value of Production is ?3802 crore as against ?3993 crore in the previous year, down by 4.79%.

Financial results:

(Rs. in Crs)

Particulars

2022-23

2021-22

Revenue from Sale of Products & Services

3839

4143

Revenue from Operations

3899

4337

Value of Production

3802

3993

Profit before Depreciation, Interest and Tax

389

321

Finance costs

46

49

Depreciation and amortization expense

64

66

Profit Before Tax

279

206

Tax Expense

120

71

Profit After Tax

159

135

Other Comprehensive Income

(19)

(27)

Total Comprehensive Income

140

108

Profit available for appropriations

550

437

Net worth

2395

2307

With increased business contribution and continued focus on cost control, your Company registered a Profit before Tax of ?279 crore as against of ?206 crore in the previous financial year, up by 35.41%.

Revenue from Operations & Profitability:

During year, Revenue from Operations was ?3899 crore as against ?4337 crore in the previous year, down by 10%.

Revenue from Operations

Improvements/ achievements in other financial/ operational parameters are provided hereunder:

• Defence Business registered a revenue growth of 3.43 % over the previous year.

• Mining & Construction Business registered a revenue growth of 1.78 % over the previous year.

• Spare parts business has achieved Revenue of ? 956.58 crore registering a growth of 2.64 % over the previous year.

• Working capital has reduced by 12%.

• Value added per employee is f33 lakhs as

against ?31 lakhs in the previous year, a jump of 6.45%.

• Trade Receivables have reduced by 34%. Exports:

Your company made exports aggregating ?830.14 crore (which includes physical exports of ?178.42 crore and deemed export of ?651.72 crore) and got export incentive of ?1.92 crore during FY 2022-23 as against exports of ?564.74 crore (which includes physical exports of ?48.75 crore and deemed exports of ?515.99 Crore) and export incentive of ?1.11 Crore during the previous year.

Order Book Position:

The order book position of your Company as on 01.04.2023 is ?8570 crore as against ?9,192 crore in the previous year. The Order book comprises of three business verticals, i.e., Mining & Construction, Defence & Aerospace and Rail & Metro.

Performance vis-a-vis MoU:

In terms of the Memorandum of Understanding (MoU) signed with the Department of Defence Production, Ministry of Defence (MoD), Government of India,

performance of your Company was rated as 'Very Good' for the financial year 2021-22 and the rating for the financial year 2022-23 is under self-evaluation.

Transfer to General Reserve:

During the year under review, your Company has not transferred any amount to General Reserve.

Dividend:

Your Board of Directors approved an interim dividend of ?5/- per equity share i.e., 50% on equity shares of ?10/- each on 10.02.2023 which was distributed among the eligible shareholders. Further, the Board of Directors have recommended a final dividend of ?5/- per equity share i.e., 50% on equity share of ?10/-each, aggregating to a total dividend of ?10/-(i.e. 100% on equity share capital) for FY 2022-23 keeping in view the future prospects of the Company and at the same time meeting the aspirations of the shareholders.

Your Company formulated a 'Dividend Distribution Policy' which includes the parameters and circumstances in determining the distribution of dividend to its shareholders and/or retaining profits earned by the Company in terms of Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The said policy is posted on the Company's website https://alumni.bemlindia.in/writereaddata/D ownloads/201806251810Dividend%20Distrib ution%20Policy.pdf

Change in the Nature of Business:

There was no change in the nature of business of the Company during the year.

Material Change/ Commitment affecting the Financial Position:

No material change/ commitment has

occurred affecting the financial position of the Company subsequent to the financial year ended 31.03.2023 till the date of this report.

Capital Structure:

There was no change in paid up share and authorized capital of the company during the year.

Finance:

The working capital requirements were met from the internal accruals and credit facilities availed from banks. There was no overdue instalment of principal and/or interest to the banks.

M/s Care Ratings have reaffirmed CARE A ; Stable for fund based facilities and CARE A ;Stable & CARE A1 for non-fund based bank guarantee & letter of credit facilities for an amount of Rs. 5,500 crores (where Rs. 4,500 crores are Secured Working Capital limits and Rs. 1000 crore are Unsecured Working Capital limits).

ICRA & Brickwork Ratings have withdrawn their ratings assigned to company's bank facilities, commercial paper and nonconvertible debentures during the year, at the request of the company.

Any change in the credit ratings is being communicated to Stock Exchanges and the same is placed on Company's website https://www.bemlindia.in/investors/credit-rating/

Further, the Company had issued Nonconvertible Debentures (NCDs) of Rs. 300 crores during 2012, out of which Rs. 100 crores was redeemed on 18.05.2022 being the 3rd and final tranche (1st and 2nd tranches of Rs. 100 crores each were redeemed on 18.05.2020 and18.05.2021 respectively). With this redemption, the Company has paid the entire NCD amount along with interest to the debenture holders.

Pursuant to SEBI notification and BSE Circular, BEML is identified as Large Corporate (LC) for the year 2022-23 as per the framework provided. As mandated by the Ministry of Corporate Affairs, the financial statements for the year ended 31.03.2023 has been prepared in accordance with the Indian Accounting Standards (IND AS) notified under Section 133 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014. The estimates and judgments relating to the Financial Statements are made on a prudent basis, so as to reflect in a true and fair manner, the form and substance of transactions and reasonably present the Company's state of affairs, profits and cash flows for the year ended 31.03.2023.

The Company's contribution to Central and State Exchequers was in the order of Rs. 746.56 crores during the year by way of Corporate tax, Customs Duty, GST, Dividend etc.

Internal Financial Controls:

The Company has various manuals such as Accounts, Cost Accounting and Pricing, Stores, Purchase, Audit etc. For easy reference, the manuals are available in 'BEML Bulletin Board" portal, so that the same can be viewed and complied easily by employees and officers concerned for carrying out various activities in a transparent manner. The manuals are in line with the delegation of powers and are being updated periodically. The changes made, if any, to the manuals are circulated and also updated in the portal. No instance of material weakness in the process has been observed.

The internal audit process is designed to review the adequacy of internal control checks in the system and covers all significant areas of the Company's operations. Further the company has put in place adequate Internal Financial Controls (IFCs) with respect to Financial Statements.

The adequacy of IFCs over financial reporting is covered by the Statutory Auditors in their Audit Report. In addition, the details of the IFCs are included under the heading 'Internal control systems and their adequacy' in the Management Discussion & Analysis Report which forms part of this report

Fixed Deposits:

The Company did not accept any fixed deposits during the year, and there was no outstanding Fixed Deposits at the beginning/ end of the year. Accordingly, there was no default in payment of deposits/ interest thereon.

Particulars of Loans, Guarantees or Investments:

As per the provisions of Section 186 of the Companies Act, 2013, the details of Loans, Guarantees and Investments are given in the notes to the Financial Statement.

Strategic Disinvestment:

Ministry of Defence (MoD) vide its letter dated 01.12.2016 communicated that Cabinet Committee on Economic Affairs (CCEA) had accorded "in-principle" approval for strategic disinvestment of 26% equity in the Company, out of Government of India shareholding of 54.03% along with management control. Inter-Ministerial Group (IMG) was constituted by the competent authority. Department of Investment & Public Asset Management (DIPAM) has appointed M/s SBI Capital Markets Limited as Transaction Advisor (TA) & M/s Crawford Bayley as Legal Advisor (LA) and Ministry of Defence (MoD) has appointed M/s RBSA Valuation Advisers LLP, Ahmedabad as Asset Valuer (AV) respectively. Further based on the advice of Inter-Ministerial Group (IMG), road shows were completed and Preliminary Information Memorandum (PIM) was published on 04.01.2021 for global invitation of Expression of Interest (EOI). EOI from

interested bidders have been received and evaluated by TA.

VDR (Virtual Data Room) has been set up by the Company and required data has been provided to TA for due diligence by qualified bidders.

Based on IMG advice, BEML had appointed M/s Deloitte Haskins & Sells LLP, as consultants for advising, undertaking and implementing the Demerger of identified surplus/ non-core assets of the Company which are not part of BEML strategic disinvestment. For demerger, transfer and vesting of identified surplus/ noncore assets, BEML incorporated "BEML Land Assets Limited".

Later on, Petition were filed with MCA for approval of Scheme of Arrangement and on

28.07.2022, MCA had passed order approving Scheme of Arrangement for demerger of "BEML Land Assets Limited" (Resulting Company).

In compliance with MCA order, BEML Limited had fixed 09.09.2022 as record date for issuing share of Resulting Company in the ratio of 1:1 and same were issued to all shareholders whose name were recorded in the Register of Member on above date. Further, the said shares were listed on both stock exchanges (BSE & NSE) and trading has started on 19.04.2023.

Directors & Key Managerial Personnel:

(1) Appoi ntment/re-a ppo i ntment of Independent Directors

During the year 2022-23, Shri Bipin Kumar Gupta (DIN: 00293673), appointed as Independent Director (ID) on the Board of the Company. In terms of section 149 of the Companies Act, 2013, the provisions of section 152(6) and (7) in respect of retirement of directors by rotation shall not be applicable to IDs. Pursuant to Schedule IV of the Companies Act, 2013, the appointment/ re-appointment of the Independent Directors would be formalized through a letter of appointment setting out the terms and conditions in case of their appointment, which is also placed on the web-site of the Company at www.bemlindia.in.

(2) Statement on declaration by Independent Directors

Independent Directors had furnished necessary declarations, in terms of Section 149(7) of the Companies Act, 2013, stating that they had fulfilled the criteria of independence as provided under Section 149(6) of the said Act and Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014 subject to the exemptions granted to the Government Companies. The Board reviewed the said declarations and noted the same.

(3) Change of Key Managerial Personnel

In terms of Article 97 of the Articles of Association of the Company, the President of India is vested with the power to appoint the Directors of the Company from time to time and also shall determine the term of office of such Directors. Accordingly, the following appointments on the Board of your Company were effected during 2022-23 as per the directives of the President of India:

(i) Dr. Shri G. Jawahar (DIN: 10043602), appointed as Director (Human Resources) of the Company vide MoD letter No.8(7)/2019-D(BEML), dated

06.01.2023. He took charge on

11.01.2023.

(ii) Shri Bipin Kumar Gupta (DIN: 00293673), appointed as Independent Director (ID) on the Board of the Company vide MoD letter No.8(6)/2021-D(BEML), dated 10.02.2023. He took charge on 10.02.2023.

(iii) Shri Shantanu Roy (DIN: 10053283), appointed as Director (Mining & Construction Business) of the Company vide MoD letter No.8 (3)/2021-D (BEML), dated 17.02.2023. He took charge on

17.02.2023.

Shri Ajit Kumar Srivastav (DIN: 08741858) Director (Defence) and Shri Anil Jerath (DIN: 09543904) Director (Finance) are liable to retire by rotation at the ensuing annual general meeting and being eligible, offer themselves for reappointment.

Shri MV Rajasekhar, (DIN: 087467141) Director (Mining & Construction), ceased to be Directors consequent upon attaining the age of superannuation w.e.f.

31.10.2022. Further, Shri Arvind Kumar Arora (DIN 07409509) and Smt. Balmuri Vanitha (DIN 08679028), ceased to be Independent Director consequent upon completion of his/ her tenure of three years on 10.07.2022 and 21.01.2023 respectively. The Board placed on record its deep appreciation for invaluable services rendered by the Shri MV Rajasekhar, Shri Arvind Kumar Arora and Smt. Balmuri Vanitha on the Board.

(4) Remuneration of Director:

As per the provision of section 197(12) of Companies Act, 2013 read with rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rule, 2014, every listed company is required to disclose the ratio of remuneration of each Director to the

median employees' remuneration and details of employees receiving remuneration exceeding limit as prescribed from time to time in the Board Report.

However, as per notification dated June 5th, 2015 issued by MCA, Government Companies are exempted from complying with the provision of section 197 of Companies Act, 2013. Therefore, such particulars have not been included in Board Report.

Government Nominee Directors were neither paid any remuneration nor sitting fee for attending Board/ Committee meetings.

Independent Directors are paid sitting fee of ?20,000 per meeting of the Board/ Committee of the Board attended by them.

Neither there was payment of commission to the Board of Directors nor any stock option scheme offered to them during the year. Further, none of the Directors had any pecuniary relationship nor entered into any related party transactions with the Company during the year.

(5) Number of meetings of Board:

During the year, nine meetings of the Board were held on 22.04.2022,

27.05.2022, 04.08.2022, 24.08.2022,

09.11.2022, 13.12.2022, 09.01.2023, 1 0 . 0 2 . 2 0 2 3 a n d 2 3 . 0 3 . 2 0 2 3 . Requirements on number and frequency of meetings, in terms of Section 173(1) of the Companies Act, 2013, Regulation 17(2) of Listing Regulations, and Para 3.3.1 of the DPE Guidelines, were complied with in full.

(6) Directors' Responsibility Statement:

Pursuant to section 134(3)(c) and 134(5)

of the Companies Act, 2013, your

Directors state that,

(a) in the preparation of the annual accounts for the year ended

31.03.2023, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) the directors had 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 2022-23 and of the profit of the Company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis;

(e) the directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) 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.

(7) Board Evaluation:

The Board of Directors of the Company comprises Functional Directors, Government Nominee Directors and Independent Directors appointed by the Government of India from time to time pursuant to Article 97 of Articles of Association of the Company. Further, the Government communication also indicates the detailed terms and conditions of their appointment based on applicability of the relevant rules of the Company.

In view of the above, the performance of all Functional Directors and Government Nominee Directors is being evaluated by the Administrative Ministry every year based on own evaluation methodology. Further, considering the educational qualifications, age, rich and varied experience of the applicants, the Administrative Ministry/ Department would appoint the IDs on the Board on the recommendation of Search Committee after obtaining approval of competent authority. In addition, the assessment/ evaluation of performance of Independent Directors who will be completing their tenure/ seeking extension was undertaken by the Department of Public Enterprises through Administrative Ministry periodically. As per requirement of SEBI (LODR), Independent Directors in their meeting held on 26.12.2022 undertook the evaluation of performance of functional directors and the minutes of said meeting were placed in the subsequent Board Meeting for information of the Board.

Committees of the Board

The following mandatory Committees required under Companies Act, Listing Regulations, DPE guidelines/ MoD Directives are constituted by the Board to function according to their respective roles and defined scope:

• Audit Committee

• Nomination and Remuneration

Committee

• Stakeholders' Relationship Committee

• Risk Management Committee

• Corporate Social Responsibility and

Sustainability Committee.

• Procurement Committee

• Share Certificate Committee

The details of the Committees along with their composition, number of meetings held and attendance at the meetings are provided in the Corporate Governance Report as annexure to the Board Report.

Enterprise Risk Management:

It terms of Section 134 of the Companies Act, 2013, Regulation 17 & 21 of the Listing Regulations and Chapter 7 of DPE Guidelines, your Company has constituted Risk Management Committee (RMC) and implemented Board approved "Risk Management Policy (RMP)" Further, the composition, reconstitution and the terms of reference in line with quorum, minimum number of meetings, gap between two meetings of RMC and Powers, roles and responsibilities of RMC a s d u l y a pproved by the Boa rd a re incorporated/ amended in the RMP as per the SEBI Listing Regulations. With the induction of Independent Director, all Business Group Directors, Director (Finance), Director (HR) and Independent Director will be the members of the Committee and senior most Functional Director will head the Committee. During the year, two meetings of RMC was held on 04.08.2022 and 30.01.2023.

The Corporate Risk Committee prepares the key risks along with mitigation plans and report to the Risk Management Committee

constituted in terms of Regulation 21 of the Listing Regulations. The said key risks and mitigation plans will be placed before Audit Committee, which recommends it for review and approval of the Board.

The Board reviews the key risks along with mitigation plans and monitor the status on risk management periodically. The RMP is placed on the Company's website https://alumni.bemlindia.in/writereaddata/D ownloads/202107051916Risk Management Policv.pdf

Related Party Transactions:

Pursuant to Regulation 23 of the Listing Regulations, your Company has formulated a "Policy on Related Party Transactions", to regulate transactions entered into between the Company and its related parties. Further, in terms of Regulation 46(2)(g) of the Listing Regulations, the said policy is placed on the website of the Company at https://alumni.bemlindia.in/writereaddata/D ownloads/202003301756Related Party Tran sactions Policy.pdf

During the year 2022-23, all transactions that were entered into with the related parties were fair, transparent and at arm's length basis and also in the ordinary course of business of the Company. The said related party transactions were also duly considered and noted by the Audit Committee. Information as required under section 188 in Form AOC-2, pursuant to Section 134(3)(h) of the Companies Act,2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, is attached to this report as Annexure-II.

Compliance of applicable Secretarial Standards:

Your Company has complied with the provisions of applicable secretarial standards

with respect to Meetings of Board of Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company Secretaries of India in terms of Section 118(10) of the Companies Act 2013. Further, as stipulated in Standard 9 of SS-1, a statement on compliances of applicable Secretarial Standards is included in the Report of the Board of Directors.

Corporate Governance Report:

In terms of Regulation 34 of the Listing Regulations and Chapter 8 of the DPE Guidelines, a report on Corporate Governance (CG) compliance is included in the Board's Report. M/s V N Associates, Practicing Company Secretaries (PCS) have issued a Compliance Certificate on the same. In terms of Para 8.2.3 of the DPE Guidelines of CPSEs, the Company's compliance level as per the grading report on Corporate Governance is rated at 'Excellent' with 97.10% (average for 4 quarters) for FY 2022-23 based on selfevaluation. The aforesaid report on Corporate Governance along with Compliance Certificate is placed at Annexure-III.

Management Discussion and Analysis Report:

In terms of Regulation 34 of Listing Regulations and Chapter 7 of the DPE Guidelines, report on Management Discussion and Analysis Report is placed at Annexure-IV.

Business Responsibility & Sustainability Report:

A Business Responsibility & Sustainability Report (BRSR) for FY 2022-23 in terms of Regulation 34 of Listing Regulations, describing the initiatives taken by the Company on environmental, social and governance perspective, in the format as specified by SEBI from time to time is placed at

Annexure-V.

Corporate Social Responsibility & Sustainability Committee:

Your Company has constituted Corporate Social Responsibility & Sustainability (CSR) Committee and implemented Board approved "CSR Policy" pursuant to Section 135 of the Companies Act, 2013, read with Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended from time to time and DPE Guidelines on MoU. Further, the composition, reconstitution and enhanced terms of reference as duly approved by the Board are incorporated in the CSR Policy.

On 31.03.2023, the Committee comprises of Shri Siva Makutam, Independent Director as Chairperson, Shri Ajit Kumar Srivastav, Director (Defence Business) and Shri Anil Jerath, Director (Finance) as members. The CSR Committee met twice during the year on 24.05.2022 and 09.02.2023. An amount of ?4.28 crore was spent during FY 2022-23 towards CSR activities which was more than 2% which is ?2.15 crore as stipulated under the Companies Act, 2013 and was in line with the Board's approved purposes and the same was certified by the Chief Financial Officer/ Director (Finance). Annual Report on CSR activities for FY 2022-23 is placed at Annexure-VI.

Quality:

Your Company views quality improvement as a business strategy and hence remains proactive in the areas of product and service quality. At BEML, Corporate Quality Policy emphasizing Total Quality Management (TQM), ensures that, Products, Services and Processes meet stringent standards and requisite performance criteria. A separate Quality Department spearheads the thrust towards Total Quality Management.

All manufacturing divisions have been certified for Quality Management System (QMS) to ISO 9001:2015 Standard. Also, all the manufacturing divisions are certified for Environmental Management System (EMS) to ISO 14001: 2015 Standard.

Further, Bengaluru Complex is certified for Occupational Health & Safety standard, as per ISO 45001: 2018. BEML Aerospace manufacturing division (ASMD), Mysore complex is certified to AS9100D Aerospace standard.

BEML has been awarded "EEPC India Quality Award for outstanding performance" under the PSU category".

Key initiatives/ actions taken during the year for continuous improvement towards Quality Assurance, are as under:

• Quality Assurance system is being continuously monitored across all the manufacturing divisions to ensure Quality improvements in Design, Processes and Systems. Few initiatives taken through Cross Functional Team (CFT), towards Quality Improvement across the divisions are as under.

i. 421 Kaizen projects were implemented across the divisions.

ii. 140 Quality Improvement projects were implemented to reduce rejection and overcome field issues.

i ii. 77 nos. Jigs & Fixture were added and upgraded to improve manufacturing Quality.

i v. 138 Vendor visits and Vendor process Audits were carried out to improve Incoming Material Quality.

• Division level Field Failure review meetings are being held regularly based

on Quality/ service issues reported. Actions are initiated to address the issues and close the issues at the earliest.

Make in India Initiative and Indigeniza-tion of products:

BEML recognizes indigenization activity (Atmanirbhar Bharat) as one of the strategic tools to achieve cost benefits and also complement the strengths of private sector to build a strong industrial base.

BEML has achieved level of indigenization of, over 90% in the mainline M&C products and Rail coaches & EMU's, over 84% in High Mobility vehicles (HMV) and over 65% in Metro cars. Further efforts are underway to reach higher levels.

BEML has nominated a Chief Indigenisation officer for Make in India drive and list of items for indigenization are hosted on Srijan portal website: www.srijan.gov.in.

Under this initiative Company has designed and developed products in all Business Verticals.

New Initiatives:

• BEML handed over the first rake of indigenously built Rail Grinding machine (RGM96) to M/s LORAM Maintenance BY WAY, USA from its manufacturing facility located in KGF Rail Coach Unit-II. This is the first time RGM96 is being manufactured outside of USA.

• Further during the year 2022-23, your Company had set a target of 335 items for indigenization under Atmanirbhar Bharat, wherein 66 items has been indigenized.

Renewable Energy Development, Energy Conservation, Research & Development, Technology Absorption and foreign exchange earnings and outgo:

In terms of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, the information on energy conservation, technology absorption and foreign exchange earnings and outgo including the products developed by the Company during the year is placed at Annexure-I.

Vigilance:

The Company has a Vigilance Department headed by an independent & full-time Chief Vigilance Officer. The Vigilance Activities were carried out in a holistic manner and covered prevention, detection and enforcement.

Vigilance is basically and admittedly a managerial function and, therefore, it is an integral part of the duties of an executive. CVO advises management on all matters pertaining to Vigilance. As an extended arm of the Central Vigilance Commission in its exercise of superintendence over Vigilance Administration of the Company, CVO provides the link to the Administrative Ministry and the CBI.

Complaints received by the Vigilance Department were handled as per Complaint Handling Policy of the Company & CVC guidelines. Such complaints were registered after owning and investigated only after determining 'Vigilance Angle'. The registered complaints are disposed after detailed investigation. During the year 2022-23 (April to March), one (01) registered complaint was Carried forward from 2021-22 and five (05) fresh complaints were received, out of which three (03) complaints were disposed during the year. After due verification/ investigation,

recommendations were made to the Management.

Surprise checks, periodic checks, scrutiny of purchase orders/ contracts, Scrutiny of TA/DA & Medical reimbursement claims, scrutiny of Annual Property Returns, ten (10) CTE type of in-house inspections and fifteen (15) system studies were conducted during the fiscal year 2022-23. Based on the outcome of these, Systemic Improvements were recommended to management & implemented, which mainly pertain to process improvements, management of procurement activities, contract, stores/ inventory, Vendor assessment, weigh bridge operation, processing of OSP claims (union members), clearing of bills, quality of products/ aggregates etc.

From April 2022 to March 2023, 4343 vigilance clearances have been processed on-line (and some special cases off-line) for executives and employees of BEML on the 'SAMPARK' Portal.

MAJOR IT INITIATIVES IN 2022-23:

• SRM IMPROVEMENTS: Improvements in

the linking processes between SAP and SRM systems to make the processes more automated and reduce manual work and also building better user experience while vendor onboarding. Auto selection of vendors is enabled. Tracking & Protecting tender documents while downloading from public.

• Network Management & Monitoring

Software.

• Implementation of Firewalls for VCs.

• Re-Design of BEML Website.

• Hyper Converged Virtual Servers Infrastructure Set-up for Non-SAP Applications.

• Extraction of VC clearance data with latest date of VC receipt from HR.

• Providing one more option "Vigilance status/ statement" in VC clearance.

• Provision for maintaining the Sensitive post sub area in SAP system.

Vigilance Awareness Week-2022 (VAW-2022) with the theme "Corruption free India for a developed Nation" was observed in the Company during 31st October 2022 to 6th November 2022 in line with the directives by Central Vigilance Commission (CVC). Citizens Integrity pledge was also administered to the Staff of BEML Limited as well as students and staff at schools and colleges and in some Gram Sabhas where the Company had organized events as part of observance of VAW-2022. Also, many Guest Lectures by eminent personalities in relevant field with topics of current relevance were organized by Vigilance Dept at the respective locations.

Central Vigilance Commission has appreciated two Vigilance officers Mr. Subash R -AGM(Vig.) and Mr. Srivatsa GY - AGM(Vig.) for their contribution towards preventive vigilance.

Sensitization programme had been conducted by in-house faculties on the eve of VAW-22 across BEML Ltd and at some vendor premises too.

A 'Vendor Meet' was organised at Corporate Office of BEML on 28th October 2022 virtually & simultaneously across all divisions of BEML linked through Video Conferencing facility with Corporate/ Divisional Executives and Vendors. There was active participation from vendors (around 80 vendors participated). CMD, CVO, all functional Directors and other senior

officers of BEML have addressed the queries/ grievance raised by vendors online.

Whistle Blower policy:

In terms of the provisions of Section 177 of the Companies Act, 2013, Regulation 22 of the Listing Regulations and Chapter 4 of the DPE Guidelines, your Company has formulated "Vigil Mechanism/ Whistle Blower Policy" for directors and employees to report genuine concerns. The said policy is placed on the Company's website https://www.bemlindia.in/wp-content/uploads/2023/05/Whistle Blower Policy.pdf

The policy provides for adequate safeguards against victimization of director/s or employee/s or any other person who avail the said mechanism and also provides for direct access to the Chairperson of the Audit Committee in appropriate or exceptional cases. The Audit Committee reviews the functioning of the whistle blower mechanism periodically as per Schedule II (A)(18) of Listing Regulations and Chapter 4 of DPE Guidelines, As per the said policy, none of the employees have been denied access to Audit Committee.

Integrity Pact

Pursuant to the directives from Central Vigilance Commission and Ministry of Defence, Integrity pact is being adopted with all Vendors/ Supplier's/ Contractor's/ service providers for all orders/ contracts of value of Rs.1 crore and above.

The pact essentially envisages an agreement between the prospective vendors/bidders and the Company, committing the persons/officials of both sides, not to resort to any corrupt practices in any aspect/ stage of the contract.

Only those vendors/bidders, who commit themselves to such a pact with the principal, would be considered competent to participate in the bidding process.

Integrity pact, in respect of a particular contract, would be operative from the stage of invitation of bids till the completion of contracts. Any violation of the same would entail disqualification of bidders and exclusion for future business dealings.

Two Independent External Monitors (IEMs) have been appointed to review the cases on bimonthly or quarterly basis.

During the FY 2022-23, Rs. 1003.72 crores of purchase orders were entered into Integrity pact out of total purchase orders value of Rs 1696.60 crores

e-Procurement:

BEML Supplier Relationship Management (SRM) is aiming to establish web based seamless relationship and collaboration of procurement process with its Global business partners.

BEML endeavors to procure materials and services through e-procurement platform on ERP system. BEML upgraded the e-procurement software i.e. SRM version from SRM-5 to SRM-7, which is having encryption facility for better security.

"Online Vendor payment tracking option" provides facility to check status of payments against supplier/ services/ payment orders.

Tender status updates are provided through automatic emails to bidders with reasons for rejections.

After opening of the price bids, all technically qualified/ pre-qualified bidders will be able to see the price details of other bids submitted against the tender.

During the year, about 88% of the total requirement was sourced through e-procurement.

Procurement through GeM:

Government e-Marketplace (GeM) is implemented by the Government with the aim to transform the way in which procurement of goods and services is done by Government Ministries & departments, Public sector undertakings and other apex autonomous bodies of the Central Government. Procurement throu g h GeM ha s been authorized by General Financial Rules by making necessary changes in government rules. GeM is a completely paperless, cashless and system driven e-market place that enables procurement of common use goods and services with minimal human interface.

During the year 2022-23, materials worth Rs 993.88 crores has been procured through GeM against the target value of Rs 527 crores (MoU parameter) i.e. 25% of previous year procurement. The same is being reviewed by Audit Committee & Board regularly.

Micro and Small Enterprises:

Company is procuring materials required for production & for others through Micro & Small Enterprises (MSE's). 358 items which are reserved for MSEs, are being procured exclusively from MSEs.

Appropriate weightage has been given for MSEs in the MoU from the year 2015-16 onwards.

As per the directive of Government, minimum 25% (Notified from 9th Nov' 2018) of procurements have to be procured from MSE's amended from 20% earlier, provided a minimum 3% reservation be kept for women owned MSE's and 4% for SC/ST Enterprises.

Further MSE procurement data is uploaded on "MSME SAMBANDH" portal on monthly basis.

During the year 2022-23, Company has procured Rs 558.75 Crores from MSE's out of Rs.1750.55 Crores local procurement, which constitutes 32% from MSE's

Vendor Development:

Vendor development is a continuous process to identify and develop new vendors to bring in competition among the vendors and to reduce costs. The following methods are generally followed to identify potential new vendors.

• Publication of Expression of Interest (Eol) in BEML Website

• Uploading of imported items in Srijan portal for Indigenisation

• Participation in exhibitions and seminars (Including Virtual)

• Organize Vendor meets (Including Virtual)

Further to encourage parts development, following EoI's has been published

Eol's Published: (For Vendor Development/ Make in India)

• Open ended Expression of Interest (Eol) has been published in BEML website for registering the new vendors.

• Eol for development of the critical items.

• Import items have been uploaded in

Srijan portal to identify potential Vendors for indigenization.

The procurements from Single source are being reviewed bi-monthly by Audit Committee & Board.

The objective of Outsourcing & Vendor Development policy is to achieve cost

effectiveness & improve competitiveness of Company in global market.

BEML recognizes outsourcing as one of the strategic tools to achieve cost benefits and also complement the strengths of private sector to build a strong industrial base. BEML is well on its journey to become a system integrator by outsourcing a substantial part of manufacturing activities from Indian vendors, enabling BEML to enhance the capacity, attain cost effectiveness and improve competitiveness in the global market. As a policy BEML is not making any capital investments where facilities are available in the Indian industry. To facilitate outsourcing, the company has well established policies, procedures and guidelines.

• New vendors are supported by way of imparting knowledge on manufacturing processes, specifications, quality plans, etc.

• BEML also extends its testing facilities to its vendors wherever required.

• To enhance transparency in all its

procurement processes, BEML has well established e-Procurement Portal.

Further as per the directives of Ministry of Defence, BEML has framed an "Outsourcing and Vendor Development Policy" as duly approved by the Board. The objective of the policy is to enhance cost effectiveness and improve competitiveness of the Company in Global market. The other significant objective of this Outsourcing and Vendor Development Policy is to build a manufacturing eco system in the Country to attain self-reliance. On the other hand, participation of Indian private industry will be an enabler in building technological and manufacturing capability

inside the country. Based on the policy so framed, a Road Map for Vendor Development has been prepared with yearly targets and monitored at the Board level periodically.

Rajbhasha:

The Hindi cell is functioning in the Corporate office of the Company and also in all Complexes & Divisions. It is responsible for ensuring the compliance of the Official Languages Act, the Rules made there under and the administrative instructions regarding use of Hindi received from the Ministry of Defence and the Department of Official Language from time to time, under its manufacturing complexes and Regional/ District Offices.

Compliance of Section 3(3) of Official Languages (OL) Act, 1963

Section 3(3) of Official Languages Act, 1963 has been complied with fully during the period under review and all the documents covered under this section have been issued bilingually. The position of the same is being monitored through the quarterly meetings of the Official Language Implementation Committee.

Hindi Fortnight Celebrations: -

Hindi Fortnight was observed in the Corporate Office, all Complexes and ROs/DOs from September 14, 2022 to September 28, 2022. During this period, executives and employees were motivated to do their maximum work in Hindi and competitions such as Hindi Crossword, Hindi Administrative Terminology, Hindi Quiz, Hindi Antakshari and Hindi Essay Competitions were organised. Instructions were issued to all offices to take the pledge on Hindi Day i.e. on September 14, 2022 in accordance with the guidelines issued by the Ministry of Defence and Department of Official

Language, Ministry of Home Affairs.

Hindi Training :-

• Training in Hindi Prabodh, Praveen and

Pragya courses were conducted during January-May, 2022 and July-November, 2022 and a total of 200 executives/ employees (Prabodh:25; Praveen: 75 and Pragya: 100) have been trained in these two sessions.

Incentive scheme for original work in Hindi:-

• Cash incentive scheme for original work in Hindi has been implemented in the Company.

Hindi Online Workshop:-

• In continuation of the practice of conducting all India level Hindi workshop through Online by BEML, the Corporate office and other offices on turn basis have conducted a total of 9 Hindi workshops and a total of 446 executives/ employees across BEML were trained.

Parliamentary Committee on Official Language

Inspection:-

• The first Sub-committee of the

Parliamentary Committee on Official Language inspected our District Office (DO), Udaipur on 17th January, 2023 on Official Language aspects and the Committee has expressed its satisfaction over the progress made in Official Language in DO, Udaipur and across BEML.

MOD inspection on Official language:-

• The Joint Director, DDP, MoD, New Delhi inspected our Regional Office, Nagpur on 27th April, 2022 on Official Language aspects and suggested some more

implementation measures for the progressive use of Official Language Policy.

Internal Rajbhasha Inspection: -

• A total of 5 internal Official Language

Inspections have been conducted by Sr. Executives of Corporate office at various offices of BEML during the year 2022-23. Detail as follows:

S.

No.

Date of Inspection

Inspection

Officer

Office

1

21.04.2022

MK

RO, Singrauli

2

08.09.2022

K

DO, Bhubaneshwar

3

16.09.2022

KPO

DO, Ahmedabad

4

22.09.2022

ED(M)

RO, Dhanbad

5

22.11.2022

K

DO, Ahmedabad

Awards and Accolades:

• Shri Sudipt sen, Sr. Manager (Parts) and Shri Pandurang Korade, Manager (Service) of District office, Bhilai have been awarded with Rajbhasha Vishisht Seva Samman and First Prize respectively by Town Official Language Implementation Committee, Bhilai-Durg for their best performance in implementing Hindi in DO, Bhilai for the year 2021-22.

Bilingual Equipment Manuals:

• The manuals of High Mobility Vehicles Sarvatra Drivers' manual, Global positioning system of Command Post Vehicle, Navigational SAT Satellite Handbook, Manuals of Rugged Workstation, RLCD and Monitor Changeover Switch, received from PPI, Palakkad Complex.

Other achievements:

• Hindi version of the Questionnaire has

been prepared for submission to the

Committee on study visit of the parliamentary standing committee on industry.

• Translation work of Company's Annual report for FY 2021-22 was completed and submitted on time.

• All translation work and Hindi typing work relating to Annual Reports, Comptroller and Auditor General Audit Paras, Technical Reports, Memorandum of Understanding, Reports on SC/ST, RTI, Reservation policy, Standing orders, Product Profiles, Advertisement Materials

and important standard forms were printed and published bilingually.

Manpower:

The number of employees of the Company as on 31.03.2023 stood at 5197 as against 5574 of the previous year resulting in over 6.76% reduction.

The category-wise number of SC/ ST and ExServicemen employees as on 01.01.2023 and representation of SC/ ST and Ex-servicemen as of the same date as compared to total strength is as under:

Category/

Group

Total Strength as on

No. of SC/ST and Ex-Servicemen

31.3.2023

31.3.2022

SC

ST

Ex-Servicemen

31.3.2023

31.3.2022

31.3.2023

31.3.2022

31.3.2023

31.3.2022

Group - A*

1816

1859

340

345

102

104

19

19

Group - B

86

50

14

11

2

2

0

0

Group - C

3283

3653

772

833

208

218

192

211

Group - D

6

7

4

5

0

0

0

0

Total

5191

5569

1130

1194

312

324

211

230

* Excluding Board Level Executives

Recruitment of SC/ ST/ OBC/ Economically weaker Section (EWS)

The Company has adopted the best practices for providing equal opportunities and harmonious environment for advancement of SC, ST, OBC and EWS. During the year, 26 employees were appointed under Group A and 50 employees on contract basis belonging to SC, ST, OBC and EWS.

Particulars of Employees

There were no employees of the Company who received remuneration in excess of the limits prescribed under Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

Industrial Relations:

The transparent and continuous communication with all Employees in the shop floor is the driving mantra of smooth and peaceful Industrial Relations scenario in the Company. The thrust was given to participatory culture which was instrumental in maintaining a constructive harmonious relationship between the Management and the Unions/ Associations. Regular Meetings with the representatives of the recognized Unions/ Officers Associations at the Divisional, Complex and Corporate Levels were held and employee related issues were resolved amicably. The functioning of various bi-partite Committees at Complex level focused on

improvement of overall performance of the Company and resolved the issues in production related matters.

Skill Development Initiatives (SDI)

Employees and their Knowledge & Skills are the key factors for retaining the Competitive edge. Thus, Training has become a vital part of every business activity at BEML and its importance would increase with the fastchanging technology, product life and market requirements.

The Highlights of Skill Development initiatives during 2022-23:

a. DPE Sponsored Training Programmes &

Workshops:

• Department of Public Enterprises (DPE), Ministry of Finance takes initiative to tie-up with top Academic institutions (including IIMs, IITs, ASCI) and Professional Bodies (ICMI, NPC, NIFM etc.) for Training Programmes & Workshops (through Classroom & on-line sessions).

• The above process involves deep scanning of PMS/ TNI data, ADC Reports, HOD inputs & approval process, post-which the registration process involves Adhaar seeding, OTP verification, seats availability (among the 300 participating organisations).

• As approved, total 46 Executives have been nominated for various programmes (15 Training Programmes & 8 Workshops) and registered through OTNS.

b. Mission Raksha Gyan Shakti (MRGS)'

initiative by GoI:

• With increasing impetus on indigeni-

sation ('Atmanirbhar Bharat'), under the "Mission Raksha Gyan Shakti (MRGS)" initiative by MoD, BEML has

been directed to provide Intellectual Property Rights (IPR)Training.

• BEML has achieved the target for the FY 2022-23 as appended below:

Description

No. of personnel to be trained

Target

Achieved

Awareness Programme on IPR by Virtual/ Physical Mode

100

167

E-certification course on COLT Platform

100

109

c. Assessment Development Centre (ADC):

• The concept of ADC was implemented in BEML during 2014 and presently it is linked to promotion policy as well as used as a base for developing Leadership pipeline (Succession Planning).

• During 2022-23, total 17 batches of ADC have been conducted and Post-ADC, 11 batches of Individual Development Plan (IDP) workshops have been organized encompassing 250 Senior Management level Executives (AGM & above).

d. Mentoring Scheme "BANDHAN"

• During 2022-23, two batches of Mentors have undergone 2-days Certification programme on 'Mentoring" through M/s Dale Carnegie. With this, total 54 No. of senior Executives are certified as "Mentors'.

e. Training Programme for SC/ ST Welfare

Association Office Bearers:

• 3-days Residential Training Programme on 'Reservation Policy for SC/ST & Maintenance of Roster' for SC/ST Welfare Association Office Bearers were organized during February, 2023 at IPE, Hyderabad.

f. Induction Programme for Management

Trainees:

• Induction process plays a vital role in integrating new joinees to BEML family. The Management Trainees (MTs) are provided orientation/ induction programme at all Manufacturing Complexes (Bangalore, Mysore, Palakkad & KGF Complexes).

• In addition to the above, 3-days special Technical Focused Training was organized for Technical MTs and Non-technical MTs and exposed to 3-days exclusive familiarisation in their domain at KGF Complex.

• At Corporate Office, the HODs of all Functions have made presentation apart from Behavioural Training programme organised through M/s Dale Carnegie.

g. Knowledge Sharing Sessions:

• In order to leverage the knowledge & skills acquired by the participants after attending DPE Sponsored Training Programmes, Knowledge Sh a ri n g Sessi on (KSS) were organized on every Friday for the Bemlians to embrace the change and sustain the Journey towards Excellence. The KSS on topics like Supply Chain Management, Industrial Artificial Intelligence in Industry 4.0, Risk Management, Building Competencies for Personal Excellence, Corporate Branding in Digital Era, Project Planning & Monitoring, Contract Management/ Safeguards in tendering, public procurement and contracting with special focus to Public Procurement Policy for Micro and Small Enterprises (MSEs) etc.

h. Centre of Excellence (CoE):

• BEML established its Centres for Excellence (CoE) at all major manufacturing Complexes to continuously learn, train and improve the technology, be it in field of Engine development, Metro Coach Fabrication, Aerospace etc. BEML also believes in developing people capability across the value chain including the Contract Workmen to retain their relevance and employability.

KGF Complex: At KGF, School of Hydraulics & Welding is specialized in Hydraulic System and Welding Process Training for various Equipments.

Bangalore Complex: CoE at Bangalore

Complex imparts Training in Stainless Steel Welding and Wire-Harnessing to support the Metro Car manufacturing. This CoE also provides Skill Training on Crane operations to Contract Operators & BEML Employees.

Mysore Complex: Mysore Complex houses specialized CoE in Electrical & Electronics systems for heavy equipments like Dumper, Motor Grader etc. The Centre also provides intensive practical & theorical Training on Calibration, Wire-Harnessing, Trouble Shooting of Equipments.

Palakkad Complex: CoE at Palakkad specializes on Power-Train mechanism including Axle, Engine, Transmission, Differential Assembly & Electrical system of heavy vehicles like TATRA and other equipments used for Defence Applications.

i. Apprenticeship Mela:

• Ministry of Skill Development & Entrepreneurship (MSDE) has organized "Apprentices Mela" at different locations towards developing Technical manpower for the industry by providing opportunities to the Apprentices.

• BEML has actively participated in this unique initiative of MSDE Apprenticeship Mela, to engage candidates as apprentices under the Apprentice Act, 1961.

j. Azadi Ka Amrit Mahotsav (AKAM):

• As per Ministry directives, various programmes conducted towards celebrating the occasion of 'Azadi Ka Amrit Mahotsav (AKAM)' as appended below:

♦ Debate/ Slogan/ Extempore Competition on "Empowerment of Women and Children" by Executives/Employees (inclusive of Apprentices),

* Circulation of Pamplets/ Brochure on "Unity of Country" through

digital mode to all Executives & Employees including Apprentices (IT Announcement)

♦ Lecture on "Language (Bhasha) of India for Executives/ Employees/ Apprentices

♦ Organise webinars on Shram Dhaan move by Executives/ Employees/ Apprentices on 'Swachta'

♦ Lecture on "Health and Wellness (with emphasis on Ayush)" for E x e c u t i v e s / E m p l o y e e s / Apprentices or Lecture on "Health and Wellness (with emphasis on Ayush)" for BEML Family members.

♦ Skill competition on 'Atmanirbhar Bharat' for Executives/Employees/ Apprentices

k. Apart from the regular training programmes at all locations (KGF, Bangalore, Mysore, Palakkad Complexes, Marketing Division & Corporate Office), the Executives/ Employees participated in the specific training programmes are as follows:

Sl

No

Title of the programme

From

To

No. of Days

Venue/

Platform

Orgnaniser

No.

attended

1

GeM

19-04-2022

19-04-2022

0.5

Hotel Le

Meridien,

Delhi

Hotel Le

Meridien,

Delhi

2

2

Interactive workshop on 'Drafting Charter party Contracts'

22-04-2022

23-04-2022

2

Delhi

Delhi

5

3

Training programme on

'Parliamentary

Procedures'

26-04-2022

27-04-2022

2

New Delhi

New Delhi

6

4

Prevention of Sexual Harassment (POSH)

21-04-2022

21-04-2022

0.5

MC

Minerva

Solutions

5

Sl

No

Title of the programme

From

To

No. of Days

Venue/

Platform

Orgnaniser

No.

attended

5

Training on Developing positive attitude/ value for better performance

11-04-2022

12-04-2022

2

KGF

IIPM

46

6

Risk Mgmt requirements and

implementation in Labs

13-04-2022

13-04-2022

1

Online

Quality Council of India, New Delhi

3

7

Uncertainty of measurement and decision rule as per ISO/ IEC 17025:2017

21-04-2022

22-04-2022

2

Online

M/s.Quality Council of India, New Delhi.

2

8

49th IFTDO World Conference & Exhibition

19-05-2022

21-05-2022

3

Vigyan Bhawan & Hotel Le-Meridien , New Delhi

Vigyan Bhawan & Hotel Le-Meridien , New Delhi

4

9

Training programme on 'Preventive Vigilance'

25-05-2022

27-05-2022

2

NFSU,

Gujarat

CVC, New Delhi

1

10

CNC Part Programming

24- 05-2022

25- 05-2022

24- 05-2022

25- 05-2022

Centre of excellence

M/s.IIPM,

Odisha

20

11

Hydraulics Basics Session-1

21-05-2022

21-05-2022

online

Mktg.

99

12

Contract Management & Arbitration

25-05-2022

25-05-2022

online

Mktg.

63

13

Communication Skills & Corporate Etiquette

27-05-2022

27-05-2022

online

Mktg.

321

14

BG825 Shift Tower, Function, Error Codes, Diagnosis, Trouble shooting

27-05-2022

27-05-2022

online

Mktg.

67

15

Two days Training on Electrical Safety

27-06-2022

28-06-2022

2

Hotel

Ashraya

International

M/s.National

Safety

Council,

Mumbai

2

16

ISO 14001:2015 Internal Auditor Training on EMS

01-07-2022

02-07-2022

2

PC

IR Class, Chennai

15


Compliance under Persons with Disabilities Act, 1995:

In terms of various provisions under The Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 (PWD Act), your Company has ensured reservation of vacancies for the posts identified for each disability and carry forward

of vacancies which could not be filled up due to non-availability of suitable persons with disability during the year.

Grievance Redressal System for SCs/STs:

The Company has constituted SC/ST Cell at all Complexes/ Divisions in terms of Department of Personnel & Training (DOPT) guidelines and Cell Officers are nominated at each

Complexes, wherein the HR heads, being Liaison Officers of the respective Complex/ Division are conducting periodical meetings with respective representatives of SC/ ST Employees Welfare Associations to redress the grievances/ issues appropriately. Further, the Chief Liaison Officer who is in the rank of Executive Director/ Chief General Manager/ General Manager meets all the Cell Officers, Liaison Officers and Office Bearers of SC/ST Welfare Associations periodically and monitor the status on redressal of grievances.

Public Grievance Redressal through CPGRAMS:

The Department of Administrative Reforms and Public Grievances under the Ministry of Personnel, Public Grievances and Pensions has initiated Centralized Public Grievance Redress and Monitoring System (CPGRAMS), which is the platform based on web technology primarily aims to enable submission of grievances by the aggrieved citizens for scrutinizing and acting for speedy redressal of these grievances. For this purpose, your Company has nominated General Manager -HR as the Nodal Officer to deal with various public grievances and to ensure prompt and proper feedback to the concerned persons.

Prohibition of Sexual Harassment of Women at Workplace:

Internal Complaints Committee (ICC) has been constituted as per Sec 4(1) of the Sexual Harassment of Women at Work Place (Prevention, Prohibition & Redressal) Act, 2013. The same is functional in all the Complexes/Divisions for receiving complaints of Sexual Harassment if any, and it has been displayed in all the prominent locations across the Complex/ Divisions for the information of all the Women employees. No Complaint has been received under this Act, during the year 2022-23.

Also, the Sexual Harassment of Women at Work place is notified as Misconduct as per

BEML CDA Rules, 2019 applicable to Officers and Certified Standing Orders applicable to Workmen.

Environment and Pollution Controli) Joint Tree Plantation Program:

Your Company in association with the State Forest Department had undertaken planting of saplings at its Manufacturing Complexes and Townships on a regular basis. During the period from April 2022 to March, 2023 a total of 3305 Nos. of Tree Saplings have been planted at Corporate Office, KGF, Bengaluru, Mysuru and Palakkad Complexes.

ii) Energy use and Conservation Measures:

The Company's 5MW Windmill at Gadag and 18 MW Windmill at Bagalkot Districts in Karnataka have contributed towards ensuring clean energy by mitigating 23704 Tons (approx) of Carbon up to March, 2023.

iii) "PAVI" distribution of solar LED Tube lights:

The company has distributed Solar LED light in Nabaguba village, Phulbani (Kandhama), Odhisha, under the project "PAVI" through the parichay Foundation. The Solar lights will help the Communities make use of sustainable and green energy as there is scarcity of electricity in the village.

Swachh Bharat Abhiyan:

The Company in continuing with its endeavor towards being a Socially Responsible entity had undertaken the various initiatives under Swachh Bharat Campaign & Swachh Vidyalaya Abhiyaan during the current year 2022-23. Important Swachh Bharat Initiatives at BEML Limited for 2022-23 are as under:

i. Swachh Bharat Initiatives:

BEML has adopted all Swachh Bharat initiatives like pledge taking, conducting public awareness programmes on cleanliness, Swachh Vidyalaya, Environment protection, public awareness on cleaning nearby areas, arranged for fixing of awareness boards, participation of employees/ officers in 'Shramadaan' (100 Hrs in a year) to ensure cleanliness of the work area & surroundings, Training programme on waste management, importance of cleanliness, walkathon, organizing skit/ street play to create awareness on cleaning and cleanliness, construction of toilets, vermi-compost bins, painting of buildings, extensive cleaning of hangars, clean my street, continuous House-keeping & renovation of toilets, fogging & eradication of mosquito menace, focus on creating plastic free zones etc.

ii. Celebration of Ninth Anniversary of Swachh Bharat Campaign & Birth Anniversary of Mahatma Gandhi:

BEML had organized "Celebration of Birth Anniversary of Mahatma Gandhi" on 2nd Oct, 2022. The Company paid its tribute to The Father of the Nation in all the Divisions/ Complexes at Bangalore, KGF, Mysore, Palakkad and at Regional & District Offices. In addition, Swachhta Pledge was taken by all present and the need to strive towards Clean India, the dream of Mahatma Gandhi was emphasized among all the employees/ officers of the Company.

iii. Annual Action Plan for Swachh Bharat Activities:

In addition, BEML has undertaken various activities as per the Annual Action Plan based on the recommendations of the

Group of Secretaries (GoS) on 'Swachh Bharat & Ganga Rejuvenation' during the year 2022-23. The main activities are: Conducting awareness programmes, Construction of Toilet Blocks under Swachh Vidyalaya Campaign, Collection, Segregation and Disposal of Waste specially Plastic waste Horticultural activities, Planting and distribution of Tree Saplings in association with the State Forest Department and cleanliness activities within the Factory premises, Townships and Public places.

iv. Outdoor Cleanliness Campaign during the period from 2nd to 31st October, 2022.

Under the Special Campaign 2.0, Outdoor cleanliness was undertaken in BEML Regional/ District offices of Hyderabad, Bilaspur, Ranchi, Neyveli and Kolkatta. The Special Campaign was carried out in two phases viz., Preparatory and Implementation phase. In the Preparatory phase from 14th to 30th September, 2022, sites were identified for carrying out the outdoor cleanliness drive and in the Implementation phase, the outdoor cleanliness activity was carried out with much publicity towards creating awareness among the general Public and the surrounding communities.

v. Celebration of Swachh Bharat Pakhwada:

BEML had organized 'Swachh Bharat Pakhwada' from 1st to 15th Dec, 2022. Various activities in line with the Action plan was held at Corporate Office, Manufacturing Complexes, Townships and Regional & District Offices. The following activities were conducted across the Company, as per the calendar of activities/ events:

• Oath Taking ceremony and March Past in the complex for spreading the awareness about cleanliness

• Display of posters and Banners in the complex for spreading the awareness about cleanliness among the employees, their families and common public.

• Cleanliness Drive in the public places like shopping complex, children parks, Townships etc.

• Organising Plogging like activities (picking of Single Use Plastic during Jogging) and collection of plastic waste

• Disposing off scrap material in the factory premises and storage in organized manner

• Weeding out of old files and office equipments. Cleaning of Furniture and fittings of offices

• Sapling distribution/ plantation in the Company's township/ residential complexes and Factory premises etc

• Painting/ Drawing competition on the subject of importance of cleanliness for Employees/ Officers and their children and contract personnel

• Organise seminar, display of posters & banners to create awareness among the people for reducing uses of Single Use Plastic & other Plastics.

• Seminar on importance of cleanliness in daily life and making plastic free Zone. Collection of plastic waste in Factory premises and residential complexes.

• Fumigation of insecticides in the township for prevention of mosquitoes and other insects.

• Essay competition on the subject of importance of cleanliness for Employees/ Officers and their children and contract personnel

• Disposal of e-wastes in Administrative offices & Plastic Waste collected in Township

• Cleanliness drive of the drainage

systems in Factory premises and residential complexes.

• Organising Mini-Marathon for employees and their families to spread the message of cleanliness

• Branding and Publicity of Pakhwada activities in electronic and print media platforms at both field and central level. The need to make use of social media such as myGov, Twitter and Facebook extensively for the purpose.

• Concluding ceremony and distribution of prizes. Organized a press conference.

Medical/ Healthcare & Nutritioni) The Medical facilities to Ex-BGML Employees and their Dependents:

The Company has been extending free medical facilities by conducting free Mobile Medical camps to the Ex-BGML Employees and their families after the closure of BGML Hospital. The Company is also extending Out-patient medical facilities by deputing Doctor and Paramedical staff to BGML areas such as Marikuppam, Champion Reef and Oorgaum. Medicines prescribed by the Doctors are being dispensed free of cost for general illness.

On 14th Nov, the World Diabetes day,

Medical camp was conducted at Koorgalli village in Mysore district, Karnataka. Diabetes Rally was also conducted in and around the village to create awareness among the communities. Banners, Placards and slogans on diabetes were

displayed. Around 113 patients suffering from various illnesses and chronic diseases viz respiratory illness, UTI, gastritis, colitis, viral fever diabetes mellitus, Hypertension, IHD etc., were treated at the Camp. The patients were educated about Diabetes mellitus, early diagnoses, maintaining optimal blood sugar level, life style modifications, Medicine Compliance etc., during the Camp.

ii) Medical Assistance:

Medical Centers for employees and dependent family members at all the three Manufacturing Units viz., Bangalore, Mysore and KGF are operational, Medical facilities are also extended to the villagers in Company adopted Dasarahosahalli, Ajjapalli village near KGF. Medical facilities are also being extended to all the Contract Labour, in the Company Medical Centre.

The Company is also extending the Medical Insurance facilities for the benefit of retired Employees/ Officers & their spouses for Medical treatment/ Hospitalization.

iii) Establishing Women Healthcare Center

The Company has associated with My Home India for establishing Women Healthcare Center at Bhadohi District in Uttar Pradesh for providing quality healthcare especially for women. The Villages covering the suriyawan Block in Bhadohi district have very poor healthcare facilities and do not meet the needs of the communities due to distance. The Women in these village are not sensitized with regard to Healthcare and approach the centers only in case of emergencies/ critical health conditions.

The Healthcare centers will not only provide the medical needs of the Women but also sensitize women with regard to Healthcare in association with Health service providers like Aangan Wadi, ASHA and ANM.

iv) Support for Mid-Day Meals:

The Company in association with the Akshaya Patra Foundation has

provided support for food distribution vehicle for the Mid-Day meals programme for the Government Schools in Mysore District, Karnataka. The program avoids classroom hunger, increases school enrolment & attendance, addresses malnutrition and also empowers women through employment.

The Company has also provided Mid-Day Meals to the Specially Challenged Children and the aged of 'The United Orphanage for the disabled' at Coimbatore, in Tamil Nadu. This program will provide nutritious and healthy meals for children and the aged who require the special care.

Contribution to Armed Forces Flag Day Fund:

Keeping in view the sacrifice of the war heroes of the country, the Company has contributed towards the 'Vocational Training Grant of Widows'. The Company has expressed its solidarity for the welfare of the family of the War Heroes.

Educationi) Educational Programme :

BEML runs one Junior College and two Primary & Nursery Schools at KGF and one at Bangalore. These Institutions, although meant primarily for the children of the employees but also caters to a large extent to the Local population. BEML also

runs a Kendriya Vidyalaya at KGF, for the benefit of the employees' children and also for the local population. The Company also provided School building, Furniture, Attender for Mid-day Programme and Security Personnel for the Government English Model Higher Primary School. For the Academic Year 2022-23, the Company is providing education to 3020 students, out of which 1897 non-BEML Students have enrolled at BEML Schools for their education during the current academic year and have availed online education.

ii) Promotion of Health, welfare, and allround development of orphan and poor children and youth- enhancing employability through vocational and skill development training :

The Company has associated with Matru Chaya to promote Health, welfare, and all-round development of orphan and poor children and youth-enhancing employability through vocational and skill development training. In this endeavour, Grameen Kousal Vikas Kendra is established in Guntur District of Andhra Pradesh in association with Matru Chaya to empower and enhance employability through vocational and skill development training to underprivileged youth of the surrounding villages.

Welfare Activities:

Welfare Activities like Medical facilities, Housing facilities, Canteen facilities at Complexes, Educational facilities at KGF and Bengaluru for Employee's children, Facility for Sports events etc. have been extended for welfare of Employees. Moreover, various Schemes are in operation for benefit of Executives and Employees including Insurance benefits viz., BEML Executive Superannuation (Pension) Scheme, BEML Post Superannuation Medical Benefit Scheme, Group Insurance

Scheme, BEML Life Risk Coverage Insurance Scheme, BEML Death Relief Fund (DRF) etc.

The Company has extended all help and support to the Labour Welfare Funds (LWF) functioning in the production units for the benefits of Employees, their dependents and local population. The LWF conducted training programmes in Tailoring, Driving, Computer, Typing/ Shorthand course, diploma course in Laboratory Technology, Para-medical, Job Oriented courses, Music/ Dance classes, spoken English Course, Summer camps for art/ painting and sports and various entertainment activities.

Compliance under the Right to Information Act, 2005

The information required to be provided to citizens under Section 4(1)(b) of RTI Act, 2005 is available on your company website, i.e., www.bemlindia .in It contains general information about the Company, its functions and duties, powers and duties of employees/ officers, decision making process, relevant rules, regulations, manuals & records held by BEML, directory of the Company's officers, pay scales of officers/ employees etc., and procedure for seeking information and inspection of Records. The Company has nominated a Central Public Information Officer, Appellate Authority, Transparency Officer and Six Central Assistant Public Information Officers representing for Complex/ Divisions to attend to the Applications & Appeals. Further, during the year 2022-23 the Company received 258 Applications seeking information pertaining to human resources, recruitment, contracts, tenders, business related matters etc., and the same were disposed of.

Digital Transformation Initiatives:

Company has embarked to implement the digital transformation (DT) initiatives for the business processes covering all the 3 business verticals.

DT initiatives in the areas of Infrastructure, Cyber Security, Business Applications & Systemic Improvements have been fully implemented and all the projects have positive impact on business both top-line and bottomline while aligning people and processes.

Some of the initiatives implemented during 2022-23 are viz., Industry 4.0 at H&P Division, KGF Complex, Improvements in FLM System, HCI Server for Non-SAP Applications, IT Tools deployed for managing IT Assets like Network & Desktop monitoring, EPS Applications for declaration and display, Monthly cyber security awareness security training sessions and Daily cyber Security Tips.

DT Roadmap for next 3 years:

1. Upgrade & Re-implement SAP ERP ECC6.0 to SAP S4HANA: Current ERP version reaching End-of-Life by Dec' 2026, thereby we need to upgrade to HANA for better productivity.

2. Upgrade OS, PC & Switches: To comply with cyber security norms & MoD Guidelines.

3. Industry 4.0: Implementation at all Manufacturing Complexes in phased manner to achieve Overall Equipment Effectiveness (OEE) with real time data.

4. GeM procurement using Alternate Part Nos: This project will update the Part no in SAP for all trading spare parts.

5. SAP HCM/SAP success factor solution: This project will replace Net based PMS and HR Portal there by no dependency on 3rd party vendors.

Report on the performance and financial position of subsidiaries and Joint Venture Company

Subsidiary Companies:

(i) M/s Vignyan Industries Limited (VIL):

MoD vide letter dated 10.09.2021

informed that the union cabinet has accorded approval for closure of VIL. Accordingly, Members of the Company at its Extraordinary General Meeting held on 11.10.2021 accorded approval for Voluntary Liquidation and appointed Shri Venkataraman Jayagopal as liquidator. Realization of Assets and settlement of accounts by the liquidator is under process.

(ii) M/s MAMC Industries Limited (MIL):

Your Company entered into a Consortium Agreement with M/s. Coal India Limited (CIL) and M/s. Damodar Valley Corporation (DVC) on 08.06.2010 for acquiring specified assets of M/s. Mining and Allied Machinery Corporation Limited (under liquidation). The agreement, inter-alia, provided for formation of a Joint Venture Company (JV) with a shareholding pattern of 48:26:26 among BEML, CIL and DVC respectively. The Company has paid the proportionate share of ?48 crore towards the total bid consideration of ?100 crore for the said acquisition, based on the order passed by the Hon'ble High Court of Calcutta. The said assets were taken possession by the MAMC Consortium. Further up to 202223, the Company has incurred a sum of ?23.98 crore (Previous Year- ?20.27 crore), towards maintenance, security and other related expenditure. The total sum of ?71.98 crore (Previous Year ?68.27 crore) is disclosed as 'Advance to MAMC Consortium' due to delay in conversion of MIL into a JV.

In the meantime, a company in the name of 'MAMC Industries Limited' (MIL) was formed and incorporated by your Company as a wholly owned subsidiary for the intended purpose of JV formation. Shareholders' agreement, as duly approved by the Boards of all three members of the consortium, has been submitted to MoD for necessary approval.

Further, MoD has directed to submit 'Business Plan' and 'Financial Viability Report' of the proposed JV. Preparation of the said report has not materialized due to exorbitant fee quoted by the consultant firms.

Further, it was proposed to register all properties in the name MAMC Industries Limited' and accordingly, M/s Fox & Mondal Advocates & Solicitors have prepared the final draft sale deed of the Mining and Allied Machinery Corporation Limited properties at different locations for registration purpose. The same shall be submitted to the Official Liquidator for his concurrence. However, to proceed for collaboration agreement, CIL support on partnership basis or assured orders on nomination basis was requested. Later on, GoI has taken up strategic disinvestment of BEML and it is in advance stage of formation of Joint Venture, BEML has requested to CIL and DVC to take back the shares of BEML and settle the value of properties purchase by BEML during court auction. Reply is awaited from both parties.

Joint Venture Company -(i) M/s BEML Midwest Limited (BMWL):

BMWL was formed and registered with the Registrar of Companies at Hyderabad on 18.04.2007. BEML holds 45% share and M/s Midwest Granite Pvt. Ltd. (MGPL) and P T Sumber Mitra Jaya of Indonesia as partners hold the balance 55% share. The Company was established to capitalize on the growing business opportunities in the contract mining segment. However, due to certain unauthorized transactions and the oppression and mismanagement by the nominees of MGPL, your Company had filed an application before Hon'ble Company Law Board (CLB) seeking for suitable relief. As a counter measure, MGPL had also filed a petition on the matter. CLB vide its common order dated 01.06.2012 directed the Central Government to appoint an inspector to investigate the

affairs of BMWL and take appropriate action. Based on the legal advice, your Company preferred two appeals before Hon'ble High Court of Andhra Pradesh at Hyderabad against the said common order of CLB. The Hon'ble High Court passed the order on 19.08.2013, thereby setting aside the said common order and directing CLB to proceed with a fresh enquiry, and decide the issue in accordance with law and merits, also taking into consideration the report of investigation as directed by CLB and pass appropriate orders without getting influenced by the impugned common order of CLB. In the meanwhile, the Government has constituted National Company Law Tribunal (NCLT) by dissolving CLB and notified that the jurisdiction is shifted to Hyderabad from Chennai. The case files were transferred to NCLT. Regional Director-MCA has submitted the investigation report dated 29.03.2022 to NCLT. Regular hearings are taking place at NCLT, Hyderabad.

Ceased to be Subsidiary, Joint Venture or Associate during the yearBEML Land Assets Limited:

During year, BEML Land Assets Limited ceased to be a subsidiary as per the Scheme of arrangement approved by the MCA vide order dated 28.07.2022. Listing of shares of BEML Land Assets Limited had taken place on both Stock exchange (BSE & NSE) and trading has started on 19.04.2023.

There was no company which became or ceased to be a subsidiary, joint venture or associate of the Company during the year except mentioned above.

A separate section on report on the performance and financial position of each of the Subsidiaries, Joint Venture Company are placed under Form AOC-1 provided in the consolidated financial statement of the Company, in terms of section 129(3) of the Companies Act, 2013 read with rule 5 of Companies (Accounts) Rules, 2014.

Consolidated Financial Statement:

Your Company has prepared the Consolidated Financial Statement of its subsidiaries in terms of Section 129(3) of the Companies Act, 2013, excepting consolidation with respect to JV Company, M/s BEML Midwest Limited due to complete cessation of activities as the matter is sub-judice, which is attached to this report.

Statutory Auditors:

M/s Sundaram & Srinivasan, Chartered Accountants, Bengaluru, were appointed as the Statutory Auditors for the financial year 2022-23 by the Comptroller & Auditor General of India.

Observations made in the Independent Auditors' Report on the financial statement including consolidated financial statement and the reply of the Board of Directors thereto are placed by way of an addendum at page No 304 to the annual report.

Cost Auditors:

In terms of Section 148 of Companies Act, 2013, read with the Companies (Cost Records and Audit) Rules, 2014, M/s R M Bansal and Co, Cost Accountants, Bengaluru, were appointed as Cost Auditors for the year 202223 to conduct the audit of the cost records of the Company. The Company maintains Cost records as specified by the Central Government under section 148(1) of the Companies Act, 2013, in respect of the Railway and Rolling Stocks (Bengaluru Complex), other Machinery (Truck, Engine, EM, H&P Divisions) and Power (EM Division).

Further, as required under the said Rules, the remuneration payable to the Cost Auditor for FY 2022-23 was ratified by the members in the 58th Annual General Meeting held on 23.09.2022.

Secretarial Auditors:

In terms of Section 204 of the Companies Act, 2013 read with the Companies (Appointment

and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed M/s V N Associates, Practicing Company Secretaries (PCS), Bengaluru, to undertake the Secretarial Audit of the Company for the year 2022-23. The Secretarial Audit Report issued by the PCS and the replies to the observations made in the said Report are annexed to the Board's Report as Annexure-VII.

In addition, an Annual Secretarial Compliance Report issued by the PCS has been filed with the Stock Exchanges within the due date from the end of financial year 2022-23.

C&AG Audit:

The Comments of the Comptroller & Auditor General of India under section 143(6)(b) of the Companies Act, 2013 on the financial statement including consolidated financial statement and reply thereto, if any, are appended at page No 216 & 306 to the annual report.

Frauds Reported by Auditor:

No frauds are reported by the auditors which fall under the purview of sub-section 12 of section 143 of Companies Act, 2013.

General disclosure:

Your Directors confirm that no disclosure or reporting is required in respect of the following items as there was no transaction on these items during the year under review:

i. No Significant and Material order was passed by any regulators or courts or tribunals that may impact the going concern statues and company's operations in future.

ii. No application made or any proceeding p e n d i n g u n d e r I n s o l v e n cy a n d Bankruptcy Code, 2016 as at the end of the Financial Year 2022-23.

iii. Details of difference between the amount of valuation at the time of one time settlement and valuation done while taking loan from banks or financial institutions are not applicable to the company.

Extract of Annual Return

An extract of the Annual Return in the prescribed form in terms of Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014, is placed at https://www.bemlindia.in/investors/annual-reports/

Acknowledgements

Your Directors express their hearty thanks to the Company's valued customers, Government of India, Administrative Ministry, the Ministry of Defence and in particular, the Department of Defence Production, M/s Coal India Limited and its Subsidiaries, M/s Singareni Collieries Company Limited, M/s Steel Authority of India Limited, Railway Board, M/s Delhi Metro Rail Corporation Limited, M/s Bengaluru Metro Rail Corporation Limited, M/s Jaipur Metro Rail Corporation, M/s Kolkata Metro Rail Corporation, M/s Maha Metro Rail Corporation Limited, Integral Coach Factory-Chennai, M/s Bharat Electronics Limited, M/s Bharat Dynamics Limited, Ordnance Factory Board, Defence Research & Development Organization (DRDO), M/s Brahmos Aerospace Pvt. Ltd., Indian Space Research Organization, M/s Hindustan Aeronautics Limited, Aeronautical Develop-

ment Agency for their patronage and confidence reposed in the Company. The Directors also acknowledge and thank all collaborators, vendors and other service providers for their valuable assistance and cooperation extended to the Company.

The Directors express their appreciation to the members of Company's Consortium of Banks and other Bankers and Financial Institutions for their continued support to the Company's operations. The Directors also thank all the shareholders/ investors for reposing continued confidence in the Company.

The Directors wish to thank the Comptroller & Auditor General of India, the Principal Director of Commercial Audit & Ex-officio Member, Audit Board and Statutory Auditors for their valued co-operation.

The Directors also acknowledge the valuable support and assistance received from various Ministries of Government, in particular Ministry of Defence, Ministry of Coal, Ministry of Mines, Ministry of Steel, Ministry of Railways, Ministry of Housing and Urban Affairs, Ministry of External Affairs and Ministry of Home Affairs. The Directors are also grateful to the Government of Karnataka and Kerala for the support and co-operation extended to the Company.

Your Directors take this opportunity to place on record their appreciation for the invaluable contribution made and excellent co-operation extended by the employees and executives at all levels for the continued progress and prosperity of the Company.