Regulation 62L - Corporate governance requirements with respect to unlisted material subsidiary of HVDLE - Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015

1 [Corporate governance requirements with respect to unlisted material subsidiary of HVDLE 62L . (1) At least one independent director, on the board of directors of the HVDLE, shall be a director on the board of directors of an unlisted material subsidiary, whether incorporated in India or not. Explanation : For the purposes of this regulation, the term material subsidiary shall mean a subsidiary, whose income or net worth exceeds twenty per cent. of the consolidated income or net worth respectively, of the listed entity and its subsidiaries in the immediately preceding accounting year. (2) The audit committee of the HVDLE shall also review the financial statements and in particular, the investments made by the unlisted material subsidiary. (3) The minutes of the meetings of the board of directors of the unlisted material subsidiary shall be placed at the meeting of the board of directors of the HVDLE. (4) The management of the unlisted material subsidiary shall periodically bring to the notice of the board of directors of the HVDLE, a statement of all significant transactions and arrangements entered into by the unlisted material subsidiary. Explanation : For the purpose of this regulation, the term significant transaction or arrangement shall mean any individual transaction or arrangement that exceeds or is likely to exceed ten per cent. of the total revenues or total expenses or total assets or total liabilities, as the case may be, of the unlisted material subsidiary for the immediately preceding financial year. (5) A HVDLE shall not dispose of shares in its unlisted material subsidiary resulting in reduction of its shareholding (either on its own or together with other subsidiaries) to less than or equal to fifty per cent. or relinquish the control over the subsidiary without passing a special resolution in its General Meeting except in cases where such divestment is made under a scheme of arrangement duly approved by a Court/Tribunal, or under a resolution plan duly approved under section 31 of the Insolvency Code and such an event is disclosed to the recognized stock exchanges within one day of the resolution plan being approved. (6) Selling, disposing and leasing of assets amounting to more than twenty per cent. of the assets of the unlisted material subsidiary on an aggregate basis during a financial year shall require prior approval of shareholders by way of special resolution, unless the sale/disposal/lease is made under a scheme of arrangement duly approved by a Court/Tribunal, or under a resolution plan duly approved under section 31 of the Insolvency Code and such an event is disclosed to the recognized stock exchanges within one day of the resolution plan being approved. (7) Where a HVDLE has a listed subsidiary, which is itself a holding company, the provisions of this regulation shall apply to the listed subsidiary in so far as its subsidiaries are concerned. ] **************** NOTES:- 1 . Inserted vide F. No. SEBI/LAD-NRO/GN/2025/239 dated 27-03-2025