The Board of Directors of your Company has pleasure in presenting the Twentieth AnnualReport on the affairs of the Company together with the Audited Accounts of the Companyfor the year ended 31ST March 2016.
1. FINANCIAL RESULTS:
The Financial Results for the year under review vis--vis the financial results forthe previous year are as under:
(Rs. In millions)
|Particulars ||2015-16 ||2014-15 |
|Gross Sales ||831 ||2399 |
|Profit before Depreciation Interest & Tax (PBDIT) ||(3507) ||(1265) |
|Financial Expenses ||1076 ||987 |
|Depreciation ||225 ||238 |
|Balances Written Off || || |
|Profit before Tax (PBT) ||(4808) ||(2490) |
|Provision for Taxation: || || |
|-Current Tax || || |
|-Deferred Tax ||44 ||1303 |
|Profit after Tax (PAT) ||(4852) ||(3793) |
|Profits available for equity shareholders || || |
|Appropriation: ||- ||- |
|Proposed Dividend on Equity Shares ||- ||- |
|Corporate Dividend Tax ||- ||- |
|Balance carried to Balance Sheet ||(4852) ||(3793) |
|Earnings per Share (Basic) Rupees ||(78.39) ||(61.29) |
|Earnings per Share (Diluted)Rupees ||(78.39) ||(61.29) |
FINANCIAL ANALYSIS AND REVIEW OF OPERATIONS:
Your Directors are hereby reporting performance of the business operations as follows:-
Sales and Export: During the year under review your Company hasregistered a turnover of Rs. 831 million as compared to Rs. 2399 million in the previousyear showing thereby a decrease of 65%. The Export turnover of manufactured API productshas also been lower at Rs. 326 million as compared to 1115 million in the previous year.Total exports including trading of products have been at Rs. 378 million as compared toRs. 1143 million in previous year. There was overall decrease in domestic sales andexports due to paucity of required working capital funds.
Profitability: The Company incurred loss before depreciation interestand tax (EBDIT) of Rs. 3507 million as compared to a loss of Rs. 1265 million in theprevious year .The Company incurred loss before tax (PBT) of Rs. 4808 million as comparedto a loss of Rs. 2490 million in the previous year. After tax adjustment/write backs ofRs. 44 million the net loss worked out to Rs. 4852 million as compared to a net loss ofRs. 3793 million in the previous year.
Assets: The net fixed assets (including work-in-progress) as at 31stMarch 2016 were Rs. 3777 million as compared to Rs. 4017 million in the previous year.
Pursuant to the provisions of Section 152 of the Companies Act 2013 and in accordancewith the Articles of Association of the Company Mr. Pranav Gupta Director of the Companyretires by rotation at the forthcoming Annual General Meeting and being eligible offerhimself for re-appointment. Notice convening the Annual General Meeting includes theproposal for his re-appointment as the Director. Mr. Arun Mathur (Independent & Non-Executive) Director on the Board of Directors of the Company had resigned from the Boardw.e.f. 22.09.2015. Mr. Sanjeev Kumar was appointed as Additional Director (Independent& Non-Executive) on the Board of Directors of the Company w.e.f 17.12.2015. During theperiod under review the Board appointed Ms. Mallika Seth as the Company Secretary of theCompany w.e.f 14.12.2015. However she resigned from the post of Company Secretary w.e.f.13.02.2016.
Mr. Sandeep Sharma and Ms. Ishrat Gill were appointed as Chief financial officer andCompany secretary respectively. In terms of the provisions of Section 203 of CompaniesAct 2013 Mr. Pranav Gupta Managing Director Mr. Sandeep Sharma CFO and Ms. Ishrat GillCompany Secretary are the KMPs of the Company.
Statement on Declaration by Independent Directors
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both under theSection 149(6) of the Companies Act 2013 and Clause 49 of the Listing Agreement with theStock Exchange.
The Company has two wholly owned subsidiary Companies namely M/s. Parabolic ResearchLabs Limited and M/s. Ziven Life Sciences Limited. The consolidated Financial Statementsof these subsidiaries and the
Company shall be laid before the Annual General Meeting of the Company.
As required pursuant to Section 129 of the Companies Act 2013 a separate statementcontaining the salient features of the Financial Statements of its subsidiary is attachedalong with the Financial Statements of the Company.
4. SHARE CAPITAL:
During the year under review the Authorized Share Capital of the Company remainedunchanged at Rs. 72 Crores (divided into 72000000 Equity Shares of Rs. 10 each).
The Promoters/Promoters Associates had contributed Rs 260 million as theiradditional contribution towards equity share capital for the allotment of 18055556equity shares at a price of Rs. 14.40/-(face value Rs.10 and premium Rs.4.40) per equityshare in terms of sanctioned CDR package. The allotment of said shares to the proposedallottees is pending for want of the in-principle approval of the Stock Exchanges requiredunder the Listing Agreements due to non-receiving of NOC from the lead bank for theallotment of shares to promoter and promoter group. The Authorized Share Capital of theCompany was increased from Rs. 72 crores to Rs. 82 crores vide resolution passed in AnnualGeneral Meeting of the members of the company held on 29th September 2015 but the companyhas not notified the Registrar of companies by Filing form SH-7 prescribed under theCompanies General Rules & Forms due to non-receiving of NOC from the lead bank for theallotment of shares to promoter and promoter group.
5. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis of financial conditions and result of operations ofthe Company for the Financial Year 2015-16 as required under Clause 49 of the ListingAgreement are annexed hereto as a separate statement in the Annual Report.
6. CORPORATE GOVERNANCE REPORT:
The Company aimed to conduct its affairs in ethical manner and has in place a system ofCorporate Governance. A separate report on Corporate Governance forming a part of theAnnual Report is annexed hereto. A certificate from the Statutory Auditors of the Companyregarding the compliance of conditions of Corporate Governance as stipulated under Clause49 of the Listing Agreement is annexed to the report on Corporate Governance.
Pursuant to the provisions of Section 139 of the Companies Act 2013 every companyat its first Annual General Meeting has to appoint an individual or a firm as an auditorwho shall hold office from the conclusion of that meeting till the conclusion of its sixthAnnual General Meeting. No listed company or a company belonging to such class or classesof companies as may be prescribed shall appoint or re-appoint an audit firm as auditorsfor more than two terms of five consecutive years. However a time of three years has beengiven for the compliance of the said provisions. The Board had re-appointed M/s. S.K.Bansal & Company Chartered Accountants Chandigarh for a period of one year i.e. from29th September 2016 to 28th September
2017. Accordingly their office shall stand vacated at the conclusion of 21st AnnualGeneral Meeting of the Company.
8. AUDITORS' REPORT:
The Auditors' Report on the Accounts of the Company for the year under review isself-explanatory and requires no comments.
9. SECRETARIAL AUDITORS REPORT:
Mr. R.K Bhalla & Associates were appointed as the Secretarial Auditors of thecompany who has submitted their report to the Board of Directors. The said report is self-explanatory and requires no comments.
10. APPOINTMENT OF COST AUDITOR:
The Board of Directors has approved the appointment of M/s. Anil Sharma & Co.Cost Accountants Chandigarh as the Cost Auditors of the Company for the Financial Year2016-17 subject to the approval of the Members in the ensuing Annual General Meeting ofthe Company. The cost audit report for the Financial Year 2015-16 will be forwarded to theCentral Government as required under Law.
11. INTERNAL CONTROL SYSTEM:
The Company has well defined internal control system. The Company takes abundant careto design review and monitor the working of internal control system. Internal Audit inthe organization is an independent appraisal activity and it measures the efficiencyadequacy and effectiveness of other controls in the organization. All significant issuesare brought to the attention of the Audit Committee of the Board.
12. FIXED DEPOSITS:
During the year 2015-16 the Company has not accepted any deposits from the public interms of the provisions of Sections 73 of the Companies Act 2013.
In view of the loss incurred by the Company during the year under review the Board ofDirectors has not recommended any dividend for the Financial Year 2015-16.
14. PERSONNEL AND HUMAN RESOURCES:
Your Company continues to lay emphasis on continued qualitative growth of its humanresources by providing a congenial and conducive work environment in consonance with itsbelief that the real strength of its organization lies in its employees.
15. INDUSTRIAL RELATIONS:
The Industrial Relations between the employees and the management remained peacefuland cordial throughout the year at all the units of the Company.
16. STATEMENT OF PARTICULARS OF EMPLOYEES: A statement of Particulars of Employeespursuant to the provisions of Section 134 of the Companies Act 2013 is enclosed andforms a part of this report.
The Company inter-alia with the following entities constitutes a group as definedunder the Monopolistic and Restrictive Trade Practices Act 1969: a) PNG Trading PrivateLimited b) Parabolic Infrastructure Private Limited
18. MEETINGS OF BOARD OF DIRECTORS:
The Board of Directors met eight times during the
Financial Year 2015-16 on 28th April 2015 18th May 2015 14th August 2015 22ndSeptember 2015 14th November 2015 17th December 2015 13th February 2016 and 17thFebruary 2016 besides a separate meeting of the Independent Directors of the Companywhich was held on 4th March 2015.
19. DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act 2013 the Directors confirm that:- a.in the preparation of the annual accounts the applicable accounting standards have beenfollowed along with proper explanation relating to material departures;
b. appropriate accounting policies have been selected and applied consistently andhave 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 31st March 2016 and of the profitand loss of the Company for the year ended on 31st March 2016;
c. proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting frauds and other irregularities;and
d. the annual accounts have been prepared on a going concern basis.
e. adequate internal financial controls to be followed by the Company have been laiddown and such controls were operating effectively.
f. proper and adequate systems to ensure compliance with the provisions of allapplicable laws have been devised and such systems were operating effectively.
20. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:Energy conservation continues to be an area of major emphasis in our Company. TheCompany has adopted the strategy of bringing about a general awareness amongst allregarding energy conservation.
Particulars with respect to conservation of energy and other areas as per Section 134(3) (m) of the Companies Act 2013 read with the Companies (Disclosure of Particulars inthe Report of Board of Directors) Rules1988 are annexed hereto and form part of thisreport.
21 . MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITIONOF THE COMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TOWHICH THE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT:
There are no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the financial year of the Company i.e.March 31 2016 and the date of the Directors Report i.e. August 13 2016.
22. REFERENCE TO THE BOARD FOR INDUSTRIAL
AND FINANCIAL RECONSTRUCTION:
The Company has been registered by the Honble BIFR as Case No. 82/2015 vide itsletter dated 02.07.2015. The last date of hearing was fixed on 02.03.2016 but proceedingsdid not take place because the bench was not available. The next date of hearing has notbeen fixed as yet.
23. REMUNERATION TO DIRECTORS/EMPLOYEES AND RELATED ANALYSIS:
During the period under review no employee of the Company received salary in excess ofthe limits as prescribed under the Act. Accordingly no particulars of employees are beinggiven pursuant to Section 134 of the Companies Act 2013 read with Rule 5(2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014. The detailspertaining to the ratio of the remuneration of each director to the median employeesremuneration and other prescribed details as required under Section 197(12) of theCompanies Act 2013 read with Rule 5(1) of the Companies (Appointment And Remuneration ofManagerial Personnel) Rules 2014 are annexed herewith and form part of the Directors'Report as Annexure I.
24. EXTRACT OF THE ANNUAL RETURN:
Pursuant to sub-section 3(a) of Section 134 and subsection (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of the Companies (Management and Administration)Rules 2014 the extracts of the Annual Return as at March 31 2016 forms part of thisreport
25 . VIGIL MECHANISM/WHISTLE BLOWER POLICY:
Pursuant to the provisions of Section 177 (9) & (10) of the Companies Act 2013 andClause 49(II) of the Listing Agreement a Vigil Mechanism/Whistle Blower Policy forDirectors and employees to report genuine concerns has been established
26. CORPORATE SOCIAL RESPONSIBILITY (CSR):
The provisions of Section 135 of Companies Act 2013 are not applicable to the Company.
27. NOMINATION AND REMUNERATION POLICY: The Companys Nomination andRemuneration Policy formulated by the Nomination and Remuneration Committee deals with theappointment and remuneration of Directors and KMPs of the Company. The policy also coversthe criteria for determining qualifications positive attributes independence of aDirector and KMP. In terms of Section 134(3)(e) of Companies Act 2013 the Nomination andRemuneration Policy of the Company is annexed herewith and forms part of the Directors'Report.
28. RISK MANAGEMENT POLICY:
Your Company has a Risk Management Policy in place duly approved by the Board ofDirectors wherein all material risks faced by the Company are identified and assessed.For each of the Risks identified corresponding controls are assessed and policies andprocedure are put in place for monitoring mitigating and reporting risk on a periodicbasis.
29 . LISTING / DE-LISTING OF SHARES:
The Shares of your Company are presently listed on The Bombay Stock Exchange LimitedMumbai (BSE) and National Stock Exchange (NSE).
30 . RELATED PARTY TRANSACTIONS:
Particulars of contracts or arrangements with related parties referred to in Section188(1) of the Companies Act 2013 in the prescribed Form AOC -2 is appended as Annexure2 to the Boards report. Your directors also draw attention of members to Note no.25(24) annexed to the Balance Sheet.
31. PERFORMANCE EVALUATION OF THE BOARD:
The Companies Act 2013 and revised Clause 49 of the Listing Agreement entered with theStock Exchanges stipulates the performance evaluation of the Directors includingChairperson Board and its Committees. Considering the said provisions the Company hasdevised the process and the criteria for the performance evaluation which has beenrecommended by the Nomination & Remuneration Committee and approved by the Board attheir meetings held on 18th January 2016.
32 . ACKNOWLEDGEMENT:
Your Directors are pleased to place on record their sincere gratitude to GovernmentBankers and Business Constituents for their continued and valuable cooperation and supportto the Company. Your Directors also express their deep appreciation for the devoted andsincere services rendered by workers staff and executives at all levels of operations ofthe Company during the year and we are confident that our Company will continue to receivesuch co-operation from them in future also.
| ||FOR AND ON BEHALF OF THE BOARD |
| ||Sd/- |
|PLACE: Chandigarh ||PRANAV GUPTA |
|DATED: 13.08.2016 ||CHAIRMAN & MANAGING DIRECTOR |