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Coral Laboratories Ltd.

BSE: 524506 Sector: Health care
NSE: N.A. ISIN Code: INE683E01017
BSE LIVE 14:00 | 07 Dec 600.00 -0.05
(-0.01%)
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605.00

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NSE LIVE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 600.00
PREVIOUS CLOSE 600.05
VOLUME 1371
52-Week high 650.00
52-Week low 373.10
P/E 15.54
Mkt Cap.(Rs cr) 214.20
Buy Price 600.00
Buy Qty 20.00
Sell Price 605.00
Sell Qty 28.00
OPEN 600.00
CLOSE 600.05
VOLUME 1371
52-Week high 650.00
52-Week low 373.10
P/E 15.54
Mkt Cap.(Rs cr) 214.20
Buy Price 600.00
Buy Qty 20.00
Sell Price 605.00
Sell Qty 28.00

Coral Laboratories Ltd. (CORALLABS) - Director Report

Company director report

Dear Members

Your Directors have pleasure in presenting the 33rd Annual Report together with theAudited Statement of Accounts for the year ended 31st March 2015.

FINANCIAL RESULTS:

The performance during the period ended 31st March 2015 has been as under:

(Rs. in Lacs)
Particulars 2014-15 2013-14
Income 6201.45 5201.64
Expenditure 4980.46 4204.47
Earning before Tax 1220.99 997.16
Provision for Tax 257.55 200.00
Provision for Deferred Tax 6.42 6.29
Less: Income Tax Adjustments of earlier years Nil 4.10
Earnings after Tax 957.02 786.77
Less: Proposed Dividend Tax on Dividend and Transfer to General Reserves 107.50 143.59
Balance Brought forward 4279.91 3636.73
Balance carried forward to Balance Sheet 5129.44 4279.91

DIVIDEND:

Your Directors are pleased to recommend dividend for the financial year 2014-2015 onthe Equity Shares of the Company of face value of Rs.10/- each at the rate of Rs.2.50/-(i.e. 25%) per equity share of the Company.

PERFORMANCE:

During the year under review the company posted Revenue of Rs.6201.46 lacs as comparedto previous year Rs.5201.64 lacs. However the earnings after tax stood at Rs.957.02 lacsas compared to Rs. 786.77 lacs during the previous year.

TRANSFER TO RESERVES:

Your Company does not proposes to transfer any amount to the general reserve. An amountof Rs.849.53 lacs is proposed to be retained in the Statement of Profit and Loss.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND:

The Company has transferred a sum of Rs.95954/- in respect of unpaid/unclaimeddividend for the Financial Year 2006-07 to the Investor Education And Protection Fund(IEPF).

Dividend for the Financial Year ended 2007-08 and thereafter which remain unclaimedfor a period of seven years will be transferred to IEPF. Members who have not encasheddividend warrant(s)/instrument(s) for the said years are requested to obtain duplicatewarrant(s) for the said years are requested to obtain duplicate warrant(s)/demand draftsby writing to the Company’s Registrar and Transfer Agent.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

As required under Clause 49 of the Listing Agreements with Stock Exchanges theManagement Discussion and Analysis Report is enclosed as a part of this report.

LISTING WITH STOCK EXCHANGES:

The Equity Shares of the Company continues to be listed at Bombay Stock Exchange. Thescrip code number of the Equity shares of the Company on BSE is 524506. The trading in theSecurities of the Company has been resumed in "T" group. The Company confirmsthat it has paid the Annual Listing Fees for the year 2015-16 to BSE where theCompany’s Shares are listed.

DEMATERIALIZATION:

The Equity shares of the Company can be held in dematerialized form. The Company hassigned the tripartite agreement with National Securities Depository Limited and CentralDepository Services (India) Limited and existing Registrar & Transfer Agent fordematerialization of existing holding of the shareholders.

The International Securities Identification Number allotted to the Company isINE683E01017. The equity shares of the Company are listed at Bombay Stock Exchange Limited(BSE).

85.46% of the company’s paid up Equity Share Capital is in dematerialized form ason 31st March 2015 and balance 14.54% is in physical form. The Company’s Registrarsare Link Intime India Private Limited C-13 Pannalal Silk Mills Compound L. B. S. MargBhandup (West) Mumbai - 400 078.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

During the financial Year 2014-2015 the Company has not made any contribution toCorporate Social Responsibility as the Company was identifying the right avenue. TheCompany has as on the date of signing the report initiated the policy of contributingtowards Corporate Social Responsibility.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO:

Information required under section 134(3)(m) of the Companies Act 2013 read with Rule8 of the Companies (Accounts) Rules 2014 is given in the Annexure - A to this report.

STATE OF AFFAIRS

During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Your Company has taken adequate steps to adhere to all the stipulations laid down inClause 49 of the Listing Agreement. A report on Corporate Governance is included as a partof this Annual Report. Certificate from the M/s. Uma Lodha & Co. Practicing CompanySecretary confirming the compliance with the conditions of Corporate Governance asstipulated under Clause 49 of the Listing Agreement is included as a part of this report.

PUBLIC DEPOSIT:

Your Company has neither accepted nor renewed any deposit within the meaning of Section73 and other applicable provisions if any of the Companies Act 2013 and the necessaryrules made there under during the year ended 31st March 2015.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:

The particulars of loans guarantees and investment have been disclosed in the notes tothe financial statements.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

(i) Changes in Directors and Key Managerial Personnel (KMP):

(a) At the Board meeting held on 05th February 2015 your Company has appointed Mrs.Meeta S. Sheth as ‘Chief Financial Officer (CFO)’ and ‘Key ManagementPersonnel (KMP)’ of the Company.

(b) In accordance with the provision of Section 152(6)(a) of the Companies Act 2013and the Articles of Association of the Company Mr. Kishor R. Mehta (DIN: 00235120) of theCompany retires by rotation at the ensuing Annual General Meeting and being eligibleoffers himself for re-appointment. Your Board recommends his reappointment.

(ii) Appointment of Independent Director:

(a) At the Annual General Meeting of the members of the Company held on 29th September2014 your Company has appointed the following persons as the Independent Directors of theCompany:

Sr. No. Name of the Director DIN Designation Independent Director Date of Appointment as
1. Mr. Rajesh R. Parikh 02527339 Independent Director 29th September 2014
2. Mrs. Sheela R. Kamdar 06948522 Independent Director 29th September 2014

DECLARATION OF INDEPENDENCE:

Your Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the provisions ofCompanies Act 2013 read with the Schedules and Rules issued there under as well as Clause49 of the Listing Agreement.

BOARD EVALUATION:

The Board of Directors has carried out an annual evaluation of its own performanceBoard committees and individual Directors pursuant to the provisions of the Act and theCorporate Governance Requirements as prescribed by Securities and Exchange Board of India("SEBI") under Clause 49 of the Listing Agreements ("Clause 49").

The performance of the Board was evaluated by the Board after seeking inputs from allthe Directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning etc.

The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.

The Board and the Nomination and Remuneration Committee ("NRC") reviewed theperformance of the individual Directors on the basis of the criteria such as thecontribution of the individual Director to the Board and committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc.

In a separate meeting of independent Directors performance of non-independentDirectors performance of the board as a whole and performance of the Chairman wasevaluated taking into account the views of executive Directors and non-executiveDirectors. The same was discussed in the board meeting that followed the meeting of theindependent Directors at which the performance of the Board its committees andindividual Directors was also discussed.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Your company has an effective internal control and risk – mitigation system whichare constantly assessed and strengthened with new/revised standard operating procedures.The Company’s internal control system is commensurate with its size scale andcomplexities of its operations. The internal and operational audit is entrusted to M/s. RJ Mehta & Associates a Chartered Accountants firm. The main thrust of internal auditis to test and review controls appraisal of risks and business processes besidesbenchmarking controls with best practices in the industry.

The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The Company has a robust Management Information System which is an integral part ofthe control mechanism.

The Audit Committee of the Board of Directors Statutory Auditors and the BusinessHeads are periodically apprised of the internal audit findings and corrective actionstaken. Audit plays a key role in providing assurance to the Board of Directors.Significant audit observation and corrective actions taken by the management are presentedto the Audit Committee of the Board. To maintain its objectivity and independence theinternal Audit function reports to the Chairman of the Audit Committee.

DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL ANDPARTICULARS OF EMPLOYEES:

In accordance with Section 178 and other applicable provisions if any of the CompaniesAct 2013 read with the Rules issued there under and Clause 49 of the Listing Agreementthe Board of Directors at their meeting held on 12th AUGUST 2014 formulated the Nominationand Remuneration Policy of your Company on the recommendations of the Nomination andRemuneration Committee. The salient aspects covered in the Nomination and RemunerationPolicy covering the policy on appointment and remuneration of Directors and other mattershave been outlined in the Corporate Governance Report which forms part of this Report.

The information required under Section 197 of the Companies Act 2013 read withCompanies Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofDirectors/ employees of your Company is set out in "Annexure [D]" to thisReport.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act 2013 Directors of your Companyhereby state and confirm that

(a) In the preparation of the annual accounts for the year ended 31st March 2015 theapplicable accounting standards had been followed along with proper explanation relatingto material departures;

(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 at the end of the financial year and ofthe profit and loss of the company for that period;

(c) The Directors had taken proper and sufficient care for the 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 had prepared the annual accounts on a going concern basis; and

(e) The Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

(f) They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

COMMITTEES:

(i) Audit Committee:

The Board has constituted a well-qualified Audit Committee with majority of them areIndependent Directors including Chairman. They possess sound knowledge on accounts auditfinance taxation internal controls etc. Mr. Rajesh R. Parikh Director acts as Chairmanto the Audit committee.

(a) (i) The Composition of Audit Committee comprises the following:

Sr. No. Name of the Director Designation in Committee Nature of Directorship
1. Mr. Rajesh R. Parikh Chairman Non Executive (Independent)
2. Mrs. Sheela R. Kamdar Member Non Executive (Independent)
3. Mr. Kishor R. Mehta Member Executive

(ii) Nomination and Remuneration Committee:

The Composition of Nomination and Remuneration Committee comprises the following:

Sr. No. Name of the Director Designation in Committee Nature of Directorship
1. Mr. Rajesh R. Parikh Chairman Non Executive (Independent)
2. Mrs. Sheela R. Kamdar Member Non Executive (Independent)
3. Mr. Navin B. Doshi Member Non Executive

(iii) Stakeholders Relationship Committee:

The Composition of Stakeholders Relationship Committee comprises of the following:

Sr. No. Name of the Director Designation in Committee Nature of Directorship
1 Mr. Rajesh R. Parikh Chairman Non Executive (Independent)
2. Mr. Navin B. Doshi Member Non Executive

AUDITORS AND AUDITORS’ REPORT:

STATUTORY AUDITORS:

M/s. Shah Sanghvi & Co. Chartered Accountants having (Firm Registration number109794W) Baroda the Statutory Auditors of the Company hold the office up to theconclusion of the ensuing Annual General Meeting and being eligible offers themselves forre-appointment for the financial year 2015-2016. Your Company has received written consentand a certificate stating that they satisfy the criteria provided under Section 141 of theCompanies Act 2013 read with the Companies (Audit and Auditors) Rules 2014 and that theappointment if made shall be in accordance with the applicable provisions of theCompanies Act 2013 and rules issued there under.

As required under Clause 49 of the Listing Agreement M/s. Shah Sanghvi & Co.Chartered Accountant have also confirmed that they hold a valid certificate issued by thePeer Review Board of ICAI. The Audit Committee and the Board of Directors recommend theappointment of M/s. Shah Sanghvi & Co. Chartered Accountants as the Auditors of yourCompany for the financial year 2015- 16 till the conclusion of the next AGM. TheAuditors’ Report for the financial year 2014-15 does not contain any qualificationreservation or adverse remark.

AUDITORS’ REPORT/ SECRETARIAL AUDIT REPORT:

The Auditors have referred to certain routine matters in their report and therespective notes to the accounts are self-explanatory.

As required under Section 204 of the Companies Act 2013 read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 your Company hasappointed M/S Uma Lodha & Co. Practicing Company Secretary to conduct the SecretarialAudit of your Company. Certain reservations and observations made in the report withregard to non-appointment of Company Secretary. The Company is still looking for the rightprofessional and that 100 percent of Promoters Shares are not in Demat form. The Companyhas already initiated the process of demating the balance physical holding ofPromoter’s Shares. However the Company would ensure in future that all theprovisions are complied with to the fullest extent.

SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 your Companyhas appointed M/s. Uma Lodha & Co. Practicing Company Secretary to conduct theSecretarial Audit of your Company. The Secretarial Audit Report is annexed herewith as"Annexure - [C]" to this Report.

COST AUDIT:

The Board of Director of Your Company has appointed M/s. Ketki D. Visariya & Co.Cost Accountants to conduct audit of your Company’s cost records for the FinancialYear 2015-16 at a remuneration of Rs.60000 (Rupees Sixty Thousand only). As requiredunder the provisions of Companies Act 2013 the remuneration of Cost Auditor as approvedby the Board of Directors is subject to ratification by the shareholders at the ensuingAnnual General Meeting.

The Cost Audit Report will be filed within the prescribed period of 180 days from theclose of the Financial Year.

EXTRACT OF THE ANNUAL RETURN:

Pursuant to Section 92(3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management and Administration) Rule 2014 the Extract of Annual Return (Form No. MGT-9)as on the financial year ended on 31st March 2015 is enclosed as "Annexure –[B]" to the Directors’ Report.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS AND AUDIT COMMITTEES

Your Board of Directors has duly met six (6) times during the financial year i.e. on30th May 2014 12th August 2014 20th August 2014 29th September 2014 31st October 2014and 05th February 2015 respectively in respect of which proper notices were given and theproceedings were properly recorded and signed in the Minute Book maintained for thepurpose. The intervening gap between the Meetings was within the period prescribed underthe Companies Act 2013.

The Audit Committee has duly met six (6) times during the financial year i.e. on 30thMay 2014 20th August 2014 22nd September 2014 31st October 2014 27th January 2015 and05th February 2015 respectively in respect of which proper notices were given and theproceedings were properly recorded and signed in the Minute Book maintained for thepurpose.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for Directors and employees to report genuine concerns has beenestablished.

The purpose of the "Whistle Blower Policy" is to allow employees to raiseconcerns about unacceptable improper or unethical practices being followed in theorganization. They will be protected against any adverse action and/or discrimination as aresult of such a reporting provided it is justified and made in good faith. The Chairmanof the Audit Committee has been designated for the purpose of receiving and recording anycomplaints under this policy.

The Vigil Mechanism Policy has been uploaded on the website of the Company athttp://www.corallab.com/pdf/Whistle-Blower-Policy.pdf under investors.

RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financial year were inthe ordinary course of the business. There are no materially significant related partytransactions made by the company with Promoters Key Managerial Personnel or otherdesignated persons which may have potential conflict with interest of the company atlarge.

Transactions with related parties entered by the Company in the normal course ofbusiness are periodically placed before the Audit Committee for its omnibus approval andthe particulars of contracts entered during the year as per Form AOC-2 is enclosed asAnnexure-E. The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 the Rulesthere under and the Listing Agreement. This Policy was considered and approved by theBoard has been uploaded on the website of the Company at athttp://www.corallab.com/pdf/Related-Party-Transaction-Policy.pdf under investors.

CODE OF CONDUCT:

The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe company. The Company believes in "Zero Tolerance" against briberycorruption and unethical dealings / behaviours of any form and the Board has laid down thedirectives to counter such acts. The code laid down by the Board is known as "code ofbusiness conduct" which forms an Appendix to the Code. The Code has been posted onthe Company’s website http://www.corallab.com/pdf/Code-of-Conduct-Coral-Lab.pdf underinvestors.

The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. The Code gives guidance through examples on the expectedbehavior from an employee in a given situation and the reporting structure.

All the Board Members and the Senior Management personnel have confirmed compliancewith the Code. All Management Staff were given appropriate training in this regard.

RISK MANAGEMENT:

Pursuant to section 134 (3) (n) of the Companies Act 2013 & Clause 49 of thelisting agreement the Company has constituted a business risk management committee. Thedetails of the committee and its terms of reference are set out in the corporategovernance report forming part of the Boards report.

At present the company has not identified any element of risk which may threaten theexistence of the company.

PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company’s shares andprohibits the purchase or sale of Company shares by the Directors and the designatedemployees while in possession of unpublished price sensitive information in relation tothe Company and during the period when the Trading Window is closed. The Board isresponsible for implementation of the Code.

All Board Directors and the designated employees have confirmed compliance with theCode.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS:

There are no significant/material orders passed by the Regulators or Courts orTribunals impacting the going concern status of your Company and its operations in future.

General a) Your Company has not issued Equity Shares with differential rights as todividend voting or otherwise; and b) Your Company does not have any ESOP scheme for itsemployees/Directors.

DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013:

The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy against sexual harassment in line with the provisions of Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 and the rules framedthereunder.

During the financial year 2014-15 the company has not received any complaints onsexual harassment and hence no complaints remain pending as of 31st March 2015.

ACKNOWLEDGMENT:

We take this opportunity to express our deep sense of gratitude to Securities andExchange Board of India Bombay Stock Exchange Limited Registrar of Companies NationalSecurities Depository Limited Central Depository Services (India) Limited M/s. LinkIntime India Private Limited Bankers and other Government Agencies for their continuedsupport.

By Order of the Board
For Coral Laboratories Limited
sd/- sd/-
Place: Mumbai Navin B. Doshi Kishor R. Mehta
Date: 29th July 2015 Chairman/Director Whole-Time Director

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