Your Directors have pleasure in presenting their 7th Annual Report together with theAudited Statement of Accounts for the year ended on 31st March 2017.
1. Operations and State of Affairs of the Company:
Rs ( In Crores)
| || |
Stand Alone basis
|For the year ended 31st March || |
|Profit for the year before Interest Depreciation and Tax ||634.84 ||988.24 ||616.26 ||1012.20 |
|Adjusting therefrom: || || || || |
|Interest (net) ||2.23 ||2.37 ||4.20 ||3.68 |
|Depreciation ||82.90 ||71.86 ||82.97 ||72.21 |
|Provision for taxation ||119.08 ||215.28 ||122.19 ||216.12 |
|Share of Loss of Associates Joint Venture Non-controlling Interest & ||(2.13) ||(0.41) ||(5.87) ||(0.56) |
|Other Comprehensive Income || || || || |
|Total Comprehensive Income ||428.50 ||698.33 ||401.03 ||719.63 |
|Share of Reserves in Associates & Joint Venture ||- ||- ||- ||(8.26) |
|Adding thereto: || || || || |
|Balance brought forward from previous year ||657.69 ||338.37 ||713.62 ||381.26 |
|The amount available is ||1088.32 ||1037.10 ||1116.69 ||1101.30 |
|Appropriating there from: || || || || |
|Dividend paid on Equity Shares during the year ||75.41 ||65.98 ||75.41 ||65.98 |
|Corporate Dividend tax paid during the year ||15.35 ||13.43 ||15.35 ||13.43 |
|Transfer to General Reserve ||300.00 ||300.00 ||300.00 ||300.00 |
|Balance carried forward to Balance Sheet ||697.56 ||657.69 ||726.02 ||713.62 |
The break-up of consolidated sales including export incentives is as under:
( Rs In Crores)
|Particulars || || |
| || || |
|Formulations ||India ||1254.47 ||1175.96 |
| ||International ||1236.29 ||1461.50 |
|API ||India ||57.66 ||50.52 |
| ||International ||582.51 ||474.42 |
|Total || ||3130.93 ||3162.40 |
The Company has prepared the Standalone and Consolidated Financial Statements inaccordance with the Companies (Indian Accounting Standards) Rules 2015 prescribed underSection 133 of the Companies Act 2013. The Company has adopted the Indian AccountingStandards (Ind AS) from 1st April 2016. The comparative financial information of theCompany for the year ended 31st March 2016 have also been restated to comply with Ind AS.
2. Transfer to Reserves:
An amount of RS 300 Crores from the net profits for the financial year under review isproposed to be carried to General Reserves.
Your Directors recommend Dividend on Equity Shares at RS 4.00 per share (i.e. 200%) offace value RS 2/- per share for the financial year ended 31st March 2017 as against RS4.00 per share (i.e. 200%) for the financial year ended 31st March 2016.
4. Management Discussion and Analysis Report:
The Management Discussion and Analysis Report as required under Schedule V of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 is included in thisAnnual Report. Certain Statements in the said report may be forward looking. Many factorsmay affect the actual results which could be different from what the Directors envisagein terms of the future performance and outlook.
5. Subsidiaries Associates and Joint Venture:
In accordance with third proviso of Section 136(1) of the Companies Act 2013 theAnnual Report of the Company containing therein its standalone and the consolidatedfinancial statements has been placed on the website of the Companywww.alembicpharmaceuticals.com. Further as per fourth proviso of the said sectionaudited annual accounts of each of the subsidiary companies have also been placed on thewebsite of the Company www.alembicpharmaceuticals. com. Shareholders interested inobtaining a physical copy of the audited annual accounts of the subsidiary companies maywrite to the Company Secretary at the Company's registered office.
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Mr. Pranav
Amin Managing Director of the Company will retire by rotation at the ensuing AnnualGeneral Meeting and is eligible for re-appointment.
7. Key Managerial Personnel:
Mr. Chirayu Amin Executive Chairman & CEO Mr. Pranav Amin Managing Director Mr.Shaunak Amin Managing Director Mr. R. K. Baheti Director - Finance & CFO and Mr.Ajay Kumar Desai Vice President - Finance & Company Secretary are Key ManagerialPersonnel of the Company.
8. Meetings of the Board:
Four (4) Board Meetings were held during the financial year ended 31st March 2017. Thedetails of the Board Meetings with regard to their dates and attendance of each of theDirectors thereat have been provided in the Corporate Governance Report.
9. Independent Directors:
The Independent Directors of the Company have given the declaration to the Company thatthey meet the criteria of independence as provided in of Section 149(6) of the CompaniesAct 2013.
10. Performance Evaluation:
Pursuant to the provisions of the Companies Act 2013 and the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 the Board has carried out the annualperformance evaluation of the Directors individually as well as evaluation of the workingof the Board and of the Committees of the Board by way of individual and collectivefeedback from Directors.
The following were the Evaluation Criteria: (a) For Independent Directors:
- Knowledge and Skills
- Professional conduct
- Duties Role and functions
(b) For Executive Directors:
- Performance as Team Leader/Member
- Evaluating Business Opportunity and analysis of Risk Reward Scenarios
- Key Set Goals and Achievements
- Professional Conduct and Integrity
- Sharing of Information with the Board
The Directors expressed their satisfaction with the evaluation process.
11. Audit Committee:
The Audit Committee consists of Independent Directors with Mr. Paresh Saraiya asChairman Mr. Pranav Parikh Mr. Milin Mehta and Dr. Archana Hingorani as members. TheCommittee inter alia reviews the Internal Control System Reports of Internal Auditors andCompliance of various regulations. The Committee also reviews the financial statementsbefore they are placed before the Board.
12. Vigil Mechanism
Pursuant to the provisions of Section 177(9) & (10) of the Companies Act 2013 andthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 a VigilMechanism or Whistle Blower Policy' for directors employees and other stakeholdersto report genuine concerns has been established. The same is also uploaded on the websiteof the Company.
13. Internal Control Systems:
The Company's internal control procedures which includes internal financial controlsensure compliance with various policies practices and statutes and keeping in view theorganization's pace of growth and increasing complexity of operations. The internalauditors team carries out extensive audits throughout the year across all locations andacross all functional areas and submits its reports to the Audit Committee of the Board ofDirectors.
14. Corporate Social Responsibility:
Alembic Group has been proactively carrying out CSR activities since more than fiftyyears. Alembic Group has established nurtured and promoted various Non ProfitOrganisations focusing on three major areas Education Healthcare and RuralDevelopment.
In compliance with requirements of Section 135 of the Companies Act 2013 the Companyhas laid down a CSR Policy. The composition of the Committee contents of CSR Policy andreport on CSR activities carried out during the financial year ended 31st March 2017 inthe format prescribed under Rule 9 of the Companies (Corporate Social ResponsibilityPolicy) Rules 2014 is annexed herewith as Annexure A.
15. Policy on Nomination and Remuneration:
The contents of Nomination and Remuneration Policy of the Company prepared inaccordance with the provisions of Section 178 of the Companies Act 2013 and Regulation 19of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 areprovided in the Corporate Governance Report.
16. Related Party Transactions:
Related party transactions that were entered into during the financial year were onarm's length basis and were in ordinary course of business. There are no materiallysignificant related party transactions made by the Company which may have potentialconflict with the interest of the Company.
There are no material related party transactions which are not in ordinary course ofbusiness or which are not on arm's length basis and hence there is no information to beprovided as required under Section 134(3)(h) of the Companies Act 2013 read with Rule8(2) of the Companies (Accounts) Rules 2014.
The Board has approved a policy for related party transactions which has been uploadedon the Company's website. The web-link as required under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is as under:http://www.alembicpharmaceuticals.com/wp-content/ uploads/2016/07/05APL-RPT-policy.pdf
17. Corporate Governance:
The Report on corporate governance as stipulated under Schedule V of the SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 forms part of the AnnualReport.
The requisite certificate from M/s. Samdani Shah & Kabra Practising CompanySecretaries confirming compliance with the conditions of corporate governance asstipulated under the aforesaid Schedule V is attached to the Report on CorporateGovernance.
18. Fixed Deposits:
As on 31st March 2017 there were unclaimed deposits amounting to RS 0.07 Crore from18 deposit holders which have been transferred to current liabilities. There has been nodefault in repayment of deposits or interest thereon. In F.Y. 2016-17 the Company has notaccepted/renewed any deposits.
19. Listing of shares:
The Equity Shares of the Company are listed on the BSE Limited (BSE) with scrip codeNo. 533573 and on National Stock Exchange of India Limited (NSE) with scrip code ofAPLLTD. The Company confirms that the annual listing fees to both the stock exchanges forthe financial year 2017-18 have been paid.
20. Loans Guarantees or Investments:
Details of Loans granted Guarantees given and Investments made during the year underreview covered under the provisions of Section 186 of the Companies Act 2013 is annexedherewith as Annexure B.
(a) Statutory Auditors:
In compliance with the Companies (Audit and Auditors) Rules 2014 M/s. K. S. Aiyar& Co. Chartered Accountants has been appointed as Statutory Auditors of the Companytill the conclusion of Annual General Meeting for the F. Y. 2018-19 as approved bythe members at their 4th Annual General Meeting held on 28th July 2014.
Further pursuant to the requirement of Section 139 of the Companies Act 2013 theappointment of Statutory Auditors is to be ratified by the members at every Annual GeneralMeeting. Members are requested to ratify their appointment for the F. Y. 2017-18.
The Auditor's Report for the financial year 2016-17 does not contain any qualificationreservation or adverse remark. The Auditor's Report is enclosed with the financialstatement in this Annual Report
(b) Secretarial Auditors:
The Board of Directors of the Company appointed M/s. Samdani Shah & KabraPractising Company Secretaries Vadodara to conduct Secretarial Audit for the F.Y.2017-18.
The Secretarial Audit Report of M/s. Samdani Shah & Kabra Practising CompanySecretaries for the financial year ended 31st March 2017 is annexed herewith as AnnexureC.
The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
(c) Cost Auditors:
Mr. H. R. Kapadia Cost Accountant Vadodara Cost Auditor of the Company has beenappointed as Cost Auditor for conducting audit of the cost accounts maintained by theCompany relating to Bulk Drugs and Formulations for the F.Y. 2017-18.
(d) Internal Auditors:
The Board of Directors appointed M/s. Ernst & Young LLP Chartered Accountants asInternal Auditors of the Company for the F. Y. 2017-18.
22. Risk Management
The Company has voluntarily constituted Risk Management Committee and formulatedEnterprise Risk Management Policy which functions as a guiding tool in fulfilling themanagement's responsibility towards risk management. Major risks identified by thebusinesses and functions are systematically addressed through mitigating actions on acontinuing basis. These are discussed at the meetings of the Risk Management CommitteeAudit Committee and the Board of Directors of the Company.
23. Directors' Responsibility Statement:
In terms of the provisions of Companies Act 2013 the Directors state that:
(a) in preparation of the annual accounts for the financial year ended 31st March2017 the applicable accounting standards have been followed along with proper explanationrelating to material departures;
(b) the directors have selected such accounting policies as listed in Note 2 to thefinancial statements and applied them consistently and made judgments and estimates thatare reasonable and prudent so as to give true and fair view of the state of affairs of theCompany at the end of the financial year as on 31st March 2017 and of the profit of theCompany for that period;
(c) the directors have taken proper and sufficient care for maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
(d) the directors have prepared the annual accounts on a going concern basis; and
(e) the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
(f) the directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
24. Material Changes:
There have been no material changes and commitments affecting the financial position ofthe Company since the close of financial year i.e. since 31st March 2017. Further it ishereby confirmed that there has been no change in the nature of business of the Company.
25. Extracts of Annual Return:
The extract of Annual Return required under Section 134(3(a) of the Companies Act 2013read with Rule 12(1) of the Companies (Management and Administration) Rules 2014 isannexed herewith as Annexure D.
26.Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo:
The information required under Section 134(3)(m) of the Companies Act 2013 read withRule 8(3) of the Companies (Accounts) Rules 2014 is annexed herewith as AnnexureE.
27.Particulars of employees and related disclosures:
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is annexed herewith as Annexure F.
A statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out in Rules 5(2) and 5(3) of the aforesaid Rulesare provided in the Annual Report. The Annual Report is being sent to the members of theCompany excluding the aforesaid information. The said information is available forinspection at the registered office of the Company during working hours and the same willbe furnished on request in writing to the members.
28. Details of Unclaimed Suspense Account:
Disclosure pertaining to Unclaimed Suspense Account as required under Schedule V of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is annexedherewith as Annexure G. The voting rights on the equity shares which are transferred toUnclaimed Suspense Account shall remain frozen till the rightful owner of such equityshares claims the shares.
|On behalf of the Board of Directors |
|Chirayu Amin |
|Chairman & CEO |
|3rd May 2017 |
|Alembic Pharmaceuticals Limited |
|Regd. Office: Alembic Road Vadodara - 390 003 |
|Tel: 0265-2280550 Fax: 0265-2282506 |
|Web: www.alembicpharmaceuticals.com |
|Email Id: firstname.lastname@example.org |
|CIN: L24230GJ2010PLC061123 |