Bharat Heavy Electricals Limited (BHEL), a Government of India undertaking, has been fined by both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) for non-compliance with board composition regulations. The fines, totaling Rs 10.86 lakh, were imposed due to the company's failure to maintain the required number of independent directors on its board.

Regulatory Non-Compliance

BHEL received notices dated November 28, 2025, from both BSE and NSE, each imposing a fine of Rs 5,42,800 (inclusive of GST). The penalties were levied for non-compliance with Regulation 17(1) of SEBI (LODR) Regulations, 2015, which pertains to the composition of the Board of Directors.

Reason for Non-Compliance

The company failed to maintain the required 50% independent directors on its board for the quarter ending September 2025. As a result, BHEL's board composition fell short of the regulatory requirements set by the Securities and Exchange Board of India (SEBI).

BHEL's Response

In response to the fines, BHEL has stated its intention to seek a waiver of the penalties imposed by the stock exchanges. The company cited the following reasons for its non-compliance:

1. As a Government Company, BHEL's directors, including independent directors, are appointed by the Government of India.
2. BHEL has been regularly communicating with the Government of India regarding the appointment of the requisite number of independent directors.

Steps Towards Compliance

BHEL has assured stakeholders that it is actively working with the Government of India to ensure the appointment of the required number of independent directors. This step aims to bring the company into compliance with SEBI regulations and avoid future penalties.

Financial Impact

The total fine imposed on BHEL is significant, as detailed in the table below:

Implications for Investors

While BHEL is seeking a waiver of the fines, this incident highlights the importance of corporate governance and regulatory compliance for listed companies. Investors should monitor the situation closely, as the resolution of this issue may impact BHEL's governance structure and potentially its stock performance.

BHEL's management has emphasized its commitment to resolving the non-compliance issue promptly. The company's ability to secure the necessary appointments and maintain regulatory compliance will be crucial for its reputation and relationship with regulatory bodies going forward.

Bharat Heavy Electricals Limited (BHEL), a Maharatna public sector undertaking, has initiated a significant move to amend its Articles of Association, aiming to enhance its powers for establishing joint ventures and subsidiaries. The company has issued a postal ballot notice seeking shareholder approval through a special resolution to modify Article 69 of its Articles of Association.

Key Points of the Amendment

The proposed amendment seeks to replace the existing clause 22 under Article 69, which currently limits BHEL's investment capabilities based on its previous Navratna status. The new clause, if approved, will read:

"To establish Joint Ventures and Subsidiaries in India or abroad and divest shareholding in joint ventures and subsidiaries, subject to compliance of Government guidelines issued from time to time."

This change aims to align BHEL's powers with its Maharatna status, granted in 2013, providing more flexibility in establishing joint ventures and subsidiaries.

Comparison of Old and New Clauses

Voting Process and Timeline

• E-voting Period: November 19, 2025 (9:00 AM IST) to December 18, 2025 (5:00 PM IST)
• Results Declaration: On or before December 20, 2025
• Scrutinizer: Shri Sachin Agarwal, Company Secretary (FCS no. 5774, CP no. 5910)

Implications for BHEL

This amendment, if approved, could potentially enhance BHEL's strategic flexibility in forming partnerships and expanding its business operations. It may allow the company to respond more effectively to market opportunities and challenges, both domestically and internationally.

Shareholders are advised to carefully review the postal ballot notice and cast their votes through the remote e-voting system provided by National Securities Depository Limited (NSDL). The outcome of this resolution could have significant implications for BHEL's future growth strategies and operational capabilities.

Note: Shareholders should ensure their email addresses are updated with the company or depositories to receive the postal ballot notice and participate in the e-voting process.