Abstract We report the results from analysis of six observations of Cygnus X-1 by Large Area X-ray Proportional Counter (LAXPC) and Soft X-ray Telescope (SXT) onboard AstroSat, when the source was in the hard spectral state as revealed by the broad-band spectra. The spectra obtained from all the observations can be described by a single-temperature Comptonizing region with disc and reflection components. The event mode data from LAXPC provides unprecedented energy dependent fractional root mean square (rms) and time-lag at different frequencies which we fit with empirical functions. We invoke a fluctuation propagation model for a simple geometry of a truncated disc with a hot inner region. Unlike other propagation models, the hard X-ray emission (>4 keV) is assumed to be from the hot inner disc by a single-temperature thermal Comptonization process. The fluctuations first cause a variation in the temperature of the truncated disc and then the temperature of the inner disc after a frequency dependent time delay. We find that the model can explain the energy dependent rms and time-lag at different frequencies.