To the Members
Your Directors are pleased to present the 29th Annual Report and the Audited Statementsof Account for the year ended 31 March 2016.
Performance of the Company
The Companys financial performance for the year ended 31 March 2016 issummarised below:
| || ||INR in Crs |
| || |
|Sales and Other Income ||257.45 ||335.60 |
|Profit / (Loss) before tax ||(175.46) ||(212.07) |
|Profit / (Loss) after tax ||(147.87) ||(183.68) |
|Balance in profit & loss account ||(133.69) ||14.19 |
State of Companys Affairs
Please refer Management Discussion & Analysis dealing with the State ofCompanys Affairs at length.
Consolidated Financial Statements
In accordance with the Companies Act 2013 ("the Act") and AccountingStandard (AS) - 21 on Consolidated Financial Statements read with AS - 23 on Accountingfor Investments in Associates and AS - 27 on Financial Reporting of Interests in JointVentures the audited consolidated financial statement is provided in the Annual Report.These consolidated financial statements provide financial information about the Companyand its subsidiaries as a single economic entity and form part of this Annual Report. Forthe year ended 31 March 2016 the consolidated revenue stood at INR 2603 Crs against INR2737.88 Crs of previous year.
Extract of Annual Return
The extract of the Annual Return of the Company in Form MGT-9 is annexed herewith asAnnexure "A" to this report.
Number of Meetings of the Board
During the Financial Year 2015-16 Six (6) Board
Meetings were held details of which are given in the Corporate Governance Reportsection.
Directors Responsibility Statement
Pursuant to the requirement under the Section 134(5) of the Companies Act 2013 withrespect to the Directors Responsibility Statement it is hereby confirmed that:
a. in the preparation of the annual accounts for the financial year ended 31 March2016 the applicable accounting standards had been followed and there are no materialdeviations from the same;
b. the directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at 31 March 2016 and of the loss ofthe Company for the year ended on that date;
c. the directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities;
d. the accounts for the financial year ended 31 March 2016 have been prepared on agoing concern basis;
e. the directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively;
f. the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.
Particulars of Loans Guarantees and Investments under section 186 of the CompaniesAct 2013
Particulars of Loans guarantees and investments covered under Section 186 of theCompanies Act 2013 form part of the notes to the financial statement provided in thisAnnual Report. These loans/guarantees are primarily granted for the furtherance ofbusiness of the borrowing companies.
Contracts and Arrangements with Related Parties
All contracts/ arrangements/ transactions entered by the Company with related partieswere in the ordinary course of business and on an arms length basis. Suchtransactions form part of the notes to the financial statements provided in this AnnualReport.
During the year the Company has not entered into any contract/ arrangement/transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions. The Policy onmateriality of related party transactions and dealing with related party transactions asapproved by the Board may be accessed on the Companys website at www.bilcare.com.
Pursuant to Section 134 of the Companies Act 2013 read with Rule 8(2) of the Companies(Accounts) Rules 2014 the particulars of such transactions are provided in Form AOC-2which is annexed herewith as Annexure "B" to this report.
In the absence of profits the Directors are not recommending any Dividend for thefinancial year ended 31 March 2016.
The paid-up Equity Share Capital as on 31 March 2016 stood at INR 235452310. Duringthe year under review the Company has not issued shares with differential voting rightsnor has granted any stock options or sweat equity. As on 31 March 2016 none of theDirectors of the Company hold instruments convertible into equity shares of the Company.
Material Changes and Commitments if any affecting the financial position of theCompany
No material changes and commitments affecting the financial position of the Companyhave occurred from the end of the financial year 2015-16 till the date of this report.Further there was no change in the nature of business of the Company.
Conservation of Energy Technology Absorption and Foreign exchange earnings & outgo
A. Conservation of Energy i. Steps taken for Conservation of Energy:
The effort to maintain the electrical power factor to unity was sustained andthis has resulted in savings of Rs. 39.90 lacs per annum (Apr 15-Mar 16).
Optimization of 105TR and 100TR chilling system and using cooling towers insteadof chillers during the winter season has given a saving of Rs. 4.80 Lacs and Rs. 8.00 Lacsrespectively in terms of electricity consumption.
ii. The Capital investment on energy conservation equipment:
No major investment was made during this financial year.
B. Technology Absorption Adaptation and Innovation
Bilcares R&D activities are ongoing and some of the benefits derived as aresult of the R&D efforts not only comprise newer innovative products and technologiesbut also has yielded significant improvement in existing products and realization of costreduction measures in the manufacturing processes as under:
Developed and established overt UV ink with reverse printing anti-counterfeitfeatures in Alu-Alu product
Developed suppository film locally and ran successfully on the imported machineat one of the customers. Commercial order received for the same.
Developed packaging film supplied for the stability study of the opthalmictablet for one of the reputed customers.
Developed process for Bilcare patina using state of the art duplex laminationmachine which is installed recently.
Developed process of making Paper/Foil lamination and then heat seal lacquercoating in one pass on state of the art triplex machine. Benefits derived:
Improved version of Bilcare Armour having cost effective solution and propertiesare comparable with conventionally available and expensive material.
Developed and commercialized solvent based offline primer system for PVDCcoating which results in sparing the additional free capacity for PVDC coating machinewithout compromising the quality.
During the financial year the company filed 2 new Patent applications related to itsinnovative products and technologies and 1 Patent applied earlier was granted.
Expenditure on Research & Development
|Particulars ||Rs. in Crores |
|Capital || |
|Recurring ||1.34 |
|Total ||1.34 |
|R&D expenditure as a percentage of total turnover ||0.52% |
|On a consolidated basis total R&D expenditure as a percentage of consolidated turnover is 0.05% || |
C. Foreign Exchange Earnings & Outgo
| ||Rs. in Crores |
|Foreign exchange earned ||108.50 |
|Foreign exchange outgo ||144.64 |
Corporate Social Responsibility (CSR)
The Corporate Social Responsibility and Governance Committee (CSR &G Committee) hasformulated and recommended to the Board a Corporate Social Responsibility Policy (CSRPolicy) which has been approved by the Board.
The CSR Policy may be accessed on the Companys website at the link:www.bilcare.com. The Company would also undertake other need based initiatives incompliance with Schedule VII to the Act.
The Annual Report on CSR activities is annexed herewith marked as Annexure"C".
The audit committee comprises of Mr. Avinash S. Joshi (Chairman) Mr. Rajendra B.Tapadia Mr. Mohan H. Bhandari as members. All the recommendations made by the committeewere accepted by the Board.
Pursuant to the provisions of the Companies Act 2013 and Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBIListing Regulations") the Board has carried out an annual performance evaluation ofits own performance the Directors individually as well as the evaluation of the workingof its Committees. Performance evaluation has been carried out as per the Nomination andRemuneration Policy.
Independent Directors Meeting
In accordance with the provisions of Schedule IV (Code for Independent Directors) ofthe Companies Act 2013 and SEBI Listing Regulations a meeting of the IndependentDirectors of the Company was held on 5 February 2016 without the attendance ofNon-Independent Directors and Members of the Management.
Details of Directors & Key Managerial Personnel
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed both undersubsection (6) of Section 149 of the Companies Act 2013 and under SEBI ListingRegulations.
As required under SEBI Listing Regulations the information on the particulars ofDirectors proposed for appointment/reappointment has been given in the Report onCorporate Governance.
Information about Subsidiary/JV/ Associate Company
During the year two new wholly owned subsidiaries were formed viz. Bilcare GCSLimited UK Bilcare GCS Inc. USA. Bilcare Singapore Pte. Ltd. (BSPL) has been underjudicial Management appointed by the Court in Singapore. The Judicial Managers formulatedthe Scheme of Arrangement with the BSPL creditors by which there was an asset &business sale of BSPL and the amount received as consideration for such sale wasdistributed among creditors of BSPL.
As a part of this Scheme of Arrangement all step-down subsidiaries of BSPL weretransferred to Bilcare Packaging Limited on September 2 2015 for a consideration of SGD1 each. Subsequently during the year these subsidiaries were closed and BilcareTechnologies Singapore Pte. Ltd. (BSTPL) was transferred to Bilcare Limited for a saleconsideration of SGD 1 to become a directly owned subsidiary of Bilcare Limited.
Consolidated Financial Statements of the Company are inclusive of the results of thesaid subsidiaries. Further a statement containing the particulars for each of thesubsidiaries is also enclosed. Copies of
21 annual accounts and related information of all the subsidiaries can also besought by any member of the Company or its subsidiaries by making a written request to theCompany Secretary at the Registered Office of the Company. The annual accounts of thesubsidiary companies are also available for inspection at the Registered Office of theCompany and that of the respective subsidiary companies. The Company has Six (6) whollyowned subsidiaries viz. Bilcare Mauritius Ltd. Mauritius Bilcare Packaging LimitedMauritius Bilcare Singapore Pte. Ltd. Singapore Bilcare Technologies Singapore Pte.Ltd. Singapore Bilcare GCS Limited UK and Bilcare GCS Inc. USA. Some of thesesubsidiaries in turn have their respective step down subsidiaries.
A statement containing the salient features of the financial statement of thesubsidiaries in the prescribed format AOC-1 is presented in a separate section formingpart of the financial statement. The Policy for determining Materialsubsidiaries has been displayed on the Companys website at www.bilcare.com.
Given below are the details of deposits covered under Chapter V of the Companies Act2013: i. Deposits accepted during the year: Nil ii. Deposits remaining unpaid or unclaimedas at the end of the year: Rs. 4130000 /-iii. Whether there has been any default inrepayment of deposits or payment of interest thereon during the year and if so number ofsuch cases and the total amount involved: The Company has obtained an order from theHonourable Company Law Board (CLB) for making payments on a deferred schedule. Hence thereare no defaults in the deposits as stated below: a. At the beginning of the year: Nil b.Maximum during the year: Nil c. At the end of the year: Nil
Significant and Material Orders
There are no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and Companys operations in future.
Internal Financial Controls
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weaknesses in the design or operation were observed.
The Company has in place Whistle Blower Policy wherein the Employees/ Directors/Stakeholders of the Company are free to report any unethical or improper activity actualor suspected fraud or violation of the Companys Code of Conduct. This mechanismprovides safeguards against victimization of Employees who report under the saidmechanism. During the year under review the Company has not received any complaints underthe said mechanism. The Whistle Blower Policy may be accessed on the Companyswebsite at www.bilcare.com
A report on Corporate Governance is given in this Annual Report. The requisitecertificate from the Auditors of the Company confirming compliance with the conditions ofcorporate governance is attached to the report on Corporate Governance.
The Internal Auditors M/s. V.S. Rawat & Co.
Chartered Accountants Pune have conducted internal audits periodically and submittedtheir reports to the Audit Committee. Their reports have been reviewed by StatutoryAuditors and the Audit Committee.
At the Annual General Meeting held on 30 September 2014 M/s. R. L. Rathi & Co.Chartered Accountants were appointed as Statutory Auditors of the Company to hold officetill the conclusion of the Annual General Meeting to be held in the year 2017. In terms ofthe first proviso to Section 139 of the Companies Act 2013 the appointment of theAuditors shall be placed for ratification at every Annual General Meeting. Accordinglythe appointment of M/s. R. L. Rathi & Co. Chartered Accountants as Statutory Auditorsof the Company will be placed for ratification by the Shareholders. In this regard theCompany has received a certificate from the Auditors to the effect that if theirappointment if ratified it would be in accordance with the provisions of Section 141 ofthe Companies Act 2013.
The observations and comments given by the Statutory Auditors in their report readtogether with notes thereon are selfexplanatory and hence do not call for any furthercomments.
The Cost Audit Report under The Companies (Cost Audit Report) Rules 2011 for the year2014-15 was duly filed with the Ministry of Corporate Affairs on 27 October 2015.
The Board has appointed M/s. Shekhar Ghatpande & Co Company Secretaries toconduct Secretarial Audit for the financial year 2015-16. The Secretarial Audit Report forthe financial year ended 31 March 2016 is annexed herewith marked as Annexure"D" to this Report. The Secretarial Audit Report does not contain anyqualification reservation or adverse remark.
Particulars of Employees & Related Disclosures
In terms of the provisions of Section 197(12) of the Companies Act (herein referred asAct) read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 statement showing the names and other particulars of theemployees drawing remuneration in excess of the limits set out in the said rules formspart of the Annual Report.
Disclosure pertaining to remuneration and other details as required under Section197(12) of the Act read with Rules 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 forms part of the Annual Report. However as per theprovisions of Section 136(1) of the Act the Report and Accounts are being sent to themembers excluding the aforesaid information. Any member interested in obtaining suchparticulars may inspect the same at the Registered Office of the Company during workinghours up to the date of the Annual General Meeting.
For the financial year ended 31 March 2016 the compliance report is provided in theCorporate Governance section of this Annual Report. The Auditors Certificate oncompliance with the mandatory recommendations of the committee is annexed to this report.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Issue of equity shares with differential rights as to dividend voting or otherwise.
2. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and except ESOS referred to in this Report.
3. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.
4. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Companys operations in future.
Disclosure under the Sexual Harassment of Women at workplace (Prevention Prohibitionand Redressal) Act 2013
In terms of provisions of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013 the Company has formulated a Policy to preventSexual Harassment of Women at Workplace.
Your Directors state that during the year under review there were no cases filedpursuant to the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013.
We thank our domestic and international customers vendors investors bankingcommunity investment bankers and rating agencies for their continued support during theyear.
Your Directors also wish to place on record their deep sense of appreciation for thecommitted services of the employees at all levels worldwide.
We thank the Governments of various countries where we have our operations and alsothank Central Government various State Governments and other Government agencies fortheir positive co-operation and look forward to their continued support in future.Finally we wish to express our gratitude to the members and shareholders for their trustand support.
For and on behalf of the Board of Directors
Mohan H. Bhandari
Chairman & Managing Director
Pune: 30 May 2016