Your Directors have pleasure in presenting the 36th Annual Report and the AuditedStatement of Accounts for the year ended 31st March 2017.
The performance during the period ended 31st March 2017 has been as under:
| || ||(Rs. In Lakhs) |
|Particulars ||31st March 2017 ||31st March 2016 |
|Sales & Other Income ||2064.22 ||2214.00 |
|Operating profit before || || |
|Financial Charges & Depreciation ||70.90 ||75.12 |
|Financial Charges ||0.85 ||1.06 |
|Profit before Depreciation ||70.05 ||74.06 |
|Depreciation ||44.03 ||49.56 |
|Profit / (Loss) before taxes ||26.02 ||24.49 |
|Prior Period Expenses ||0.00 ||0.00 |
|Provision for Taxation of Current Year ||14.27 ||14.49 |
|Deferred Tax for the Current Year ||0.00 ||0.00 |
|Net profit after taxes ||11.74 ||4.17 |
|Profit/(Loss) brought forward from previous year ||4.17 ||13.96 |
|Dividend (including tax on Dividend) ||0.00 ||0.00 |
|Balance of profit brought forward ||11.74 ||4.17 |
STATE OF COMPANY'S AFFAIRS:
During the year under review the gross revenue of the Company was Rs.2064.22 Lakhscompared to Rs.2214.00 Lakhs in the-previous year. However Profit after tax for the yearincreased to Rs. 11.74 Lakhs as compared to Rs. 4.17 Lakhs in the previous year.
The Company is looking forward in expansion of its products segments and widening ofits domestic market segments in the narrow future we expect a healthy growth in theupcoming financial years.
The authorised capital of the company stand unchanged from previous year at Rs.100000000/- (Rupees Ten Crores) the Issued Subscribed and Paid up Capital of theCompany as on March 31 2017 is Rs.68269600/-(Rupees Six Crores Eighty Two Lakhs SixtyNine Thousand and Six Hundred) divided into 6826960 equity shares of Rs.10/- (RupeesTen) each.
The company has not declared the dividend during the financial year under review.
TRANSFERS TO RESERVES:
An amount of Rs. 11739327- has been transferred to the Reserves being the profitearned during the financial year 2016-17.
NUMBER OF MEETING OF THE BOARD:
The Board of Directors duly met 5 (Five) times on 27-05-2016 11-08-2016 26-09-201614-11-2016 and 14-02-2017 in respect of which meetings proper notices were given and theproceedings were properly recorded and signed in the Minutes Book maintained for thepurpose.
DIRECTORS AND KEY MANAGERIAL PERSONNEL.
Mr. Vinay R. Sapte Director retires by rotation at the forthcoming Annual GeneralMeeting and being eligible offer himself for reappointment.
Mr. Abhishek Wakchaure a qualified Company Secretary was appointed as the CompanySecretary & Compliance Officer of the Company w.e.f 11th August 2016.
Mr. Pravin Hegde (DIN : 01404954) was appointed as an Additional Non-ExecutiveIndependent Director of the Company by the B'oard in their meeting held on 14.02.2017 whoshall hold office upto the date of the ensuing Annual General Meeting of the Company. Themembers of the Company are requested to regularize the appointment of Mr. Pravin Hegde atthe forthcoming Annual General Meeting of the Company.
During the year under review Mr. Bhupinder Garg Independent Director resigned from theBoard of the Company.
DIRECTORS RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 134(5) OF THE COMPANIESACT 2013:
In compliance of section 134 (5) of the Companies Act 2013 your directors o t thebest of their knowledge and belief confirm:
a) That in the preparation o^ the annual accounts the appVicaWe accounting standardshave been followed along with proper explanation relating to material departures;
b) That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit or loss of the company for the year under review;
c) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the company and for preventing and detecting fraud andother irregularities;
d) The Annual Accounts for the year ended 31st March 2017 has been prepared on a goingconcern basis.
e) that the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial control to be followed by the company areadequate and were operating effectively.
f) that the Directors has devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
The Company has received necessary declarations from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 that the Independent Directors ofthe Company meet the criteria of their independence as laid down in Section 149(6) of theCompanies Act 2013.
PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is as under. Further there were no employees who were drawing salary ofmore than INR 8.5 Lakhs per month or INR 102 Lakhs per annum.
a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:
|Executive Directors ||Ratio to Median remuneration |
|Yallapragada Naga Bhaskara Rao ||3.31:1 |
|Maneesh Ramakant Sapte ||Nil |
b. The percentage increase in remuneration of each directors Chief Executive OfficerChief Financial Officer Company Secretary in the financial year:
|Directors CEO CFO and Company Secretary ||% increase in Remuneration in the Financial Year. |
|Maneesh Ramakant Sapte ||Nil |
|Y.N. Bhaskara Rao ||14.29% |
|Vinay Ramakant Sapte ||Nil |
|Bharat Merchant Bachubai ||Nil |
|Bhupinder Narendra Garg ||Nil |
|Rashmi Vinay Sapte ||Nil |
|Pravin Hegde ||Nil |
c. The percentage increase in the median remuneration of employees in the financialyear: 10 %
d. The number of permanent employees on the rolls of Company: 37 Employees
e. Variations in the market capitalization of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year and percentageincrease over decrease in the market quotations of the shares of the Company in comparisonto the rate at which the Company came out with the last public offer in case of listedcompanies and in case of unlisted companies the variations in the net worth of theCompany as at the close of the current financial year and previous financial year.
|Sr. No ||PARTICULARS ||As at March 31st2017 ||As at March 31st 2016 |
|1. ||Market Capitalization ||119130452 ||215049240 |
|2. ||Price Earnings Ratio ||102.65:1 ||525:1 |
Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase inthe managerial remuneration:
Average percentile increase in the salaries of the employees other than the managerialpersonnel in the last financial year is 10% Average percentile increase in the Managerialremuneration in the last financial year is 14.29%
g. Comparison of each remuneration of the key managerial personnel against theperformance of the Company:
|Particulars ||Maneesh R. Sapte ||Y.N. Bhaskara Rao |
| ||Managing Director ||Whole-Time Director |
|Remuneration in FY 2016-17 || ||12800007- |
|Revenue || ||2064223297- |
|Remuneration as % of revenues ||No Remuneration paid ||0.62% |
|Profit before Tax (PBT) Remuneration || ||26015657- |
|(as % of PBT) || ||49.20% |
POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION:
The Company hasframed policy on Directors' appointment and remuneration and othermatters provided in section 178(3) of the Act and is referred to while taking decisionsunder its purview.
Audit Committee of the Company meets the requirements of section 177 of the CompaniesAct 2013. During the year under review the Board has accepted all the recommendations ofthe Audit Committee The details of the composition of the Audit Committee as requiredunder the provisions of Section 177(8) of the Companies Act2013is given below.
|Mr. Bharat B. Merchant ||Chairman |
|Mr. Y.N. Bhaskara Rao ||Member |
|Mr. Pravin Hegde ||Member |
NOMINATION AND REMUNERATION COMMITTEE:
Nomination and Remuneration Committee meets the requirements of section 178 of theCompanies Act2013. During the year under review the Board has accepted all therecommendations of the Nomination and Remuneration Committee. The details of thecomposition of the Nomination and Remuneration Committee is furnished as below:
|Mr. Bharat B. Merchant ||Chairman |
|Mr. Vinay R. Sapte ||Member |
|Mr. Pravin M. Hegde ||Member |
CORPORATE SOCIAL RESPONSIBILITY
The provisions w.r.t. CSR are not applicable to the Company therefore the Company hadnot constituted CSR committee during the year 2016-17.
Annual evaluation has been carried out by the Board of Directors of its ownperformance board committees and individual directors pursuant to the provisions of theapplicable Actrules and guidelines.
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 committeeswas 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 reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings like preparedness onthe issues tobediscussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role. n I a separatemeeting of independent directors performance of non-independent directors performance ofthe Board as a whole and performance of the chairman was evaluated taking into accountthe views of executive directors and non-executive directors. The same was discussed inthe board meeting that followed the meeting of the independent directors at which theperformance of the Board its committees and individual directors was also discussed.Performance evaluation of independent directors was done by the entire board excludingthe independent director being evaluated. The overall performance of the ChairmanExecutive Directors and Non-Executive Directors of the company is satisfactory. The reviewof performance was based on the criteria of performance knowledge analysis quality ofdecision making etc.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICHTHE FINANCIAL STATEMENTSRELATEAND 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 and the date of thereport.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE COURTS/ REGULATORS:
During the year under review there are no significant and material orders passed by theCourts or Regulators against the Company.
EXTRACT OF ANNUAL RETURN
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) ofCompanies (Management and Administration) Rules 2014 an extract of annual return in FormMGT-9 as a part of this annual report is annexed as Annexure I.
REPLIES TO AUDITORS REPORT:
With reference to observations made inAuditor's Report the notes of account areself-explanatory and therefore do not calls for any further comments under section 134(5)of Companies Act 2013.
SECRETARIAL AUDIT REPORT:
In terms of section 204 of the Companies Act and Rules made there under theSecretarial Audit Report as provided by Mr. Manoj Kumar Koyalkar of M/ s. AGR Reddy &Co Practicing Company Secretaries. The Secretarial Audit Report is enclosed asAnnexure II to this report. The Secretarial auditor has highlighted few points in thesecretarial audit report. The Board wants to place before the members its comments on theobservations of the Secretarial auditor which are as below: The delay mentioned in thesecretarial audit report with respect to ESI PF TDS and Service Tax were madeinadvertently. These were later deposited and filed with interest and penalties. TheCompany is taking appropriate steps to avoid these in future.
The Company has a team which monitors the effectiveness of the internal controlsystems. It reports to the Audit Committee about the adequacy and effectiveness of theinternal control system of your Company. The Company has appointed M/s. Thirupathi &Associates Chartered Accountants to carry out internal audit.
The recommendations of the internal audit team on improvements in the operatingprocedures and control systems are also presented to the Audit Committee and the businessto use these as tools for strengthening the operating procedures.
DETAILS OF SUBSIDIARY/ASSOCIATE /JOINT VENTURE COMPANY
At present your Company does not have any Subsidiary/Associate/Joint Venture Company
The Company has not accepted any deposit from the public under Chapter V of the Act orunder the corresponding provisions of Section 73 and 74 of the Companies Act 2013 and noamount of principal or interest was outstanding as on the Balance Sheet date.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
The Company has not given/done any Loans Guarantees and investments covered under theprovisions of section 186 of the Companies Act 2013 during the reporting period.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The details regarding transaction with related parties covered under section 188 of theCompanies Act 2013 is given in 'Annexure III' and forms part of this report. Therelated Parties disclosure pursuant to SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 are as per point no 27.3 of the financial statements ofthe Company.
LISTING WITH STOCK EXCHANGE
The equity shares of the Company are listed on Bombay Stock Exchange (BSE). The annuallisting fee for the financial year 2017-18 is paid to the stock exchange.
CONSERVATION OF ENERGY FOREIGN EXCHANGE ETC: (A) Conservation Of Energy
(i) The steps taken or impact on conservation of energy: Nil (ii) The steps taken bythe company for utilizing alternate sources of energy: Nil (iii) The capital investment onenergy conservation equipments: Nil
(B) Technology absorption
(i) The efforts made towards technology absorption;
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution; (iii) In case of imported technology (imported during the lastthree years reckoned from the beginning of the financial year) (a) The details oftechnology imported; (b) The year of import; (c) Whether the technology been fullyabsorbed; (d) If not fully absorbed areas where absorption has not taken place and thereasons thereof;
Wo technology is imported during financial year 2016-17
(iv) The expenditure incurred on Research and Development: Nil
(C) Foreign exchange earnings and Outgo
Foreign Exchange Inflows: NIL Foreign Exchange Outflows: NIL
INTERNAL FINANCIAL CONTROL SYSTEMS
The Company has adequate Internal Financial Controls consistent with the nature ofbusiness and size of the operations to effectively provide for safety of its assetsreliability of financial transactions with adequate* checks and balances adherence toapplicable statues accounting policies approval procedures and to ensure optimum use ofavailable resources. These systems are reviewed and improved on a regular basis. It has acomprehensive budgetary control system to monitor revenue and expenditure against approvedbudget on an ongoing basis.
The Properties and assets of your Company are adequately insured.
The Company has laid down the procedure for risk assessment and its mitigation throughan internal Risk Committee. Key risks and their mitigation arising out of reviews by theCommittee are assessed and reported to the Audit Committee on a periodic basis. The RiskManagement Policy details the Company's objectives and principles of Risk Management alongwith an overview of the Risk Management processes procedures and related roles andresponsibilities.
WHISTLE BLOWER POLICY/VIGIL MECHANISM:
In line with requirement of the CompaniesAct 2013 Vigil Mechanism/Whistle BlowerPolicy has been formulated for Directors and employees to report concerns about unethicalbehaviour actual or suspected fraud or violation of Company's Code of Conduct etc. Thesaid Policy provides for adequate safeguard against victimization of directors/employeeswho avail of such mechanism and provides access to the Chairman of Audit Committee inexceptional cases. It is affirmed that no person has been denied access to the AuditCommittee.
During the year there were no Whistle Blower complaints received.
As per regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Compliance of Corporate Governance norms are not applicable to yourCompany hence the disclosures under the Corporate Governance requirement have not beenmentioned in the Annual Report. Though the provisions of Corporate Governance are notapplicable o t the Company the operations and transactions of the Company are done n i atransparent manner.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis Report pursuant to Regulation 34 reads withSchedule V of Securities and Exchange Board of India (Listing Obligation and DisclosureRequirement) Regulations 2015 forms part of this report and the same is annexed.
ISO 9001- 2008 CERTIFICATION:
Your Company continues to hold ISO 9001 - 2008 Certification by meeting all therequirements of certification from time to time.
SEXUAL HARASSMENT POLICY:
The Company as required under the provisions of "The Sexual Harassment of Women atWorkplace (Prohibition Prevention and Redressal) Act 2013" has framed a Policy onProhibition Prevention and Redressal of Sexual Harassment of Women at Workplace andmatters connected therewith or incidental thereto. Internal Complaints Committee (ICC) hasbeen set up to redress complaints received regarding sexual harassment. All employees(permanent contractual temporary trainees) are covered under this policy. In the yearunder review the Company has not received any complaint under this Policy. Your Directorsplace on record their appreciation for the services rendered by the employees. Therelation between the management and the employees has been cordial throughout the year.
Your Directors are pleased to record their sincere appreciation of the contribution bythe workmen and staff at all levels inthe improved performance of the Company.
None of the employees are drawing Rs. 850000/- and above per month or Rs.102000007- and above in aggregate per annum as remuneration the limits prescribedunder provisions of the Companies Act 2013.
Your Directors wish to place on record their appreciation of the contribution made bythe employees at all levels to the continued growth and prosperity of your Company.
Your Directors also wish to place on record their appreciation of businessconstituents banks and other financial institutions and shareholders of the Company fortheir continued support and patronage.
|For and on behalf of the Board of Directors |
|For Phaarmasia Limited || |
|Sd/- ||Sd/- |
|Maneesh R. Sapte ||Y. N. Bhaskara Rao |
|Managing Director ||Whole-time Director |
|DIN: 00020450 ||DIN: 00019052 |
|Place: Hyderabad || |
|Date: 22nd August 2017 || |
FORM NO. AOC.2
Form for disclosure of particulars of contracts/arrangements entered into by thecompany with related parties referred to in sub-section (1) of section 188 of theCompanies Act 2013 including certain arms length transactions under third proviso thereto(Pursuant to clause (h) of sub-section (3)of section 134 of the Act and Rule 8(2) of theCompanies (Accounts) Rules 2014)
1. Details of contracts or arrangements or transactions not at arm's lengthbasis
(a) Name(s) of the related party and nature of relationship - N.A
(b) Nature of contracts/arrangements/transactions - N.A
(c) Duration of the contracts/arrangements/transactions - N.A
(d) Salient terms of the contracts or arrangements or transactions including the valueif any- N.A
(e) Justification for entering into such contracts or arrangements or transactions -N.A
(f) date(s) of approval by the Board - N.A (g) Amount paid as advances if any: - N.A
(h) Date on which the special resolution was passed in general meeting as requiredunder first proviso to section 188 - N.A
2. Details of material contractsor arrangementor transactions at arm's lengthbasis
(a) Name(s) of the related party and nature of relationship - Maneesh PharmaceuticalsLimited (Holding Company) (b) Nature of contracts/arrangements/transactions - Sale /Purchase transactions (c) Duration of the contracts/arrangements/transactions - FY 2016-17(d) Salient terms of the contracts or arrangements or transactions including the value ifany:
Goods Sold - Rs. 54169241-
Goods purchased - Rs. 31987003/-(e) Date(s) of approval by the Board if any:N.A (f) Amount paid as advances if any: Nil
|For and on behalf of the Board of Directors || |
|For Phaarmasia Limited || |
|Sd/- ||Sd/ - |
|Maneesh R.Sapte ||Y.N.Bhaskara Rao |
|Managing Director ||Whole-tim e Director |
|DIN: 00020450 ||DIN : 00019052 |
|Place: Hyderabad || |
|Date: 22nd August 2017 || |