InGovern opposes Sameer Hiremath as Hikal chairman and MD, 2 other advisers back him

Proxy advisory firm InGovern has recommended that shareholders of Hikal Ltd. vote against the appointment of Sameer Hiremath as Chairman and Managing Director, as well as the remuneration proposed for him, ahead of the company’s 38th Annual General Meeting on September 23.

However, two other proxy advisory firms — Institutional Investor Advisory Services (IiAS) and Stakeholders Empowerment Services (SES) — have recommended that shareholders support the resolution. IiAS backed the proposal, citing Hiremath’s long association with the company, while SES recommended his appointment, stating that it had identified no major governance concerns.

InGovern has opposed the board-backed proposal to appoint Hiremath as Chairman and Managing Director for three years from October 1, 2026, arguing that combining the two roles in a promoter-family executive could reduce the separation between executive management and board oversight.

The proxy adviser said Hikal has not proposed an independent chair, lead independent director or any other formally defined mechanism to ensure independent board leadership and oversight of the CMD.

InGovern has also flagged concerns over the remuneration proposal. It said the resolution allows for minimum remuneration in the event of inadequate profits but does not disclose a maximum annual or aggregate remuneration payable during the approval period.

According to InGovern, the proposal also includes broad perquisites, reimbursements, benefits, schemes and awards that may be determined by the board without a specific monetary cap or detailed shareholder disclosure.

The firm further said Hikal has not disclosed the fixed-pay structure, variable-pay opportunity, performance metrics, threshold, target and maximum performance conditions, peer benchmarking, or malus and clawback provisions.

The recommendation comes against the backdrop of a weaker financial performance in FY26. Hikal swung to a net loss of ₹49 crore from a net profit of ₹91 crore a year earlier. Revenue declined 8% to ₹1,695 crore, while EBITDA fell 18.5% to ₹268 crore from ₹328 crore in FY25.

Hiremath’s total remuneration also declined sharply to ₹1.34 crore in FY26 from ₹6.04 crore a year earlier, according to data compiled from Hikal’s annual report.

Hiremath directly holds 390,975 equity shares in Hikal and an additional 187,500 shares through Sameer Trust. As of June 2026, promoter entities collectively held 68.85% of the company, while public shareholders held the remaining 31.15%.

InGovern also cited what it described as revenue-recognition irregularities, employee document alteration, the statutory auditor’s ADT-4 filing, audit-trail exceptions, US Food and Drug Administration (FDA) remediation and unresolved environmental litigation.

The proxy adviser said these circumstances warrant stronger independent governance and a more transparent, performance-linked executive remuneration framework before the Chair and MD roles are combined.

Hikal’s board, at a meeting on August 26, proposed Hiremath’s appointment as Chairman and Managing Director, effective October 1, 2026, along with the remuneration payable to him, subject to shareholder approval at the AGM.

The recommendation marks a fresh proxy-advisory intervention ahead of the AGM. InGovern has previously raised governance concerns at Hikal amid the dispute between the Hiremath and Kalyani promoter groups.