Your Directors have pleasure in presenting their 112th Annual Reporttogether with the Audited Statement of Accounts for the year ended on 31stMarch 2019.
1 Operations and State of Affairs of the Company:
| || ||(Rs. In lacs) |
|For the year ended 31st March ||2019 ||2018 |
|Profit for the year before Interest Depreciation and Tax ||4754 ||4812 |
|Adjusting therefrom: || || |
|Interest (net) ||22 ||17 |
|Depreciation ||263 ||378 |
|Provision for deferred tax liabilities or (assets) ||(83) ||30 |
|Provision for current tax ||442 ||209 |
|Profit for the year ||4111 ||4178 |
|Add: || || |
|Balance brought forward from previous year ||11331 ||7798 |
|Total amount available for Appropriations ||15442 ||11976 |
|Other Appropriations ||(246) ||2 |
|Less: || || |
|Dividend paid on Equity Shares during the year ||514 ||534 |
|Corporate Dividend tax paid during the year ||105 ||109 |
|Transfer to General Reserve ||- ||- |
|Balance carried forward to next year's accounts ||15069 ||11331 |
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.
2 Transfer to Reserve:
During the year under review the Company has not proposed any amount to be transferredto General Reserve out of the net profits of the Company for the financial year2018-19.
Your Directors recommend Dividend at Rs. 0.20 per equity share (face value Rs. 2/-each) (i.e. 10%) for the financial year ended 31st March 2019 as against Rs.0.20 per equity share (i.e. 10%) for the financial year ended 31 st March2018.
4 Demerger of Identified Real Estateundertaking:
The Board of Directors of the Company had at their meeting held on 3rdNovember 2018 approved the Composite Scheme of Arrangement comprising of the transfer andvesting of the Identified Real Estate Undertaking of Alembic Limited ('the Company' or'the First Demerged Company' or 'Alembic') comprising of a real estate developmentproject along with related real estate interest and Project Management Consultancybusiness into Shreno Limited ('the First Transferee Company' or 'the Second DemergedCompany' or 'Shreno') and transfer and vesting of Engineering Division and
Investment Division of Shreno Limited into Nirayu Private Limited ('the SecondTransferee Company' or 'Nirayu') and their respective shareholders (the Scheme')with effect from the Appointed Date i.e. 1st November 2018. The equityshareholders secured creditors and unsecured creditors of Alembic Limited have at theirrespective meetings held on 9th April 2019 approved the aforesaid Scheme.
The Scheme has been sanctioned by the Hon'ble National Company Law Tribunal AhmedabadBench (NCLT') vide its order dated 26th July 2019. The Scheme is noweffective upon filing of the certified copy of order of the NCLT sanctioning the Schemewith the Registrar of Companies Gujarat at Ahmedabad by way of filing required e-formswith Ministry of Corporate Affairs' portal.
Pursuant to the Scheme equity shareholders of Alembic Limited will receive 1 (one)fully paid up 7% Non-Convertible Cumulative Redeemable Preference Shares - I of Rs. 2/-each at a premium of Rs. 14.50/- per share of Shreno Limited the First Transferee Companyfor every 1 (one) fully paid up equity share of Rs. 2/- each held in Alembic the FirstDemerged Company.
5 Management Discussion and Analysis Report:
The Report on Management Discussion and Analysis Report as required under Schedule V ofthe SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is annexedherewith as Annexure A.
6 Subsidiaries Associates and Joint ventures:
A statement containing the salient features of the financial statements of subsidiaryand associates companies as per Section 129(3) of the Companies Act 2013 are part ofthe consolidated financial statements.
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.alembiclimited.com. Further as per fourth proviso of the said section audited annualaccounts of the subsidiary company has also been placed on the website of the Company.Shareholders interested in obtaining a physical copy of the audited annual accounts of thesubsidiary companies may write to the Company Secretary requesting for the same.
In accordance with the provisions of the Companies Act 2013 and the Articles ofAssociation of the Company Mrs. Malika Amin Managing Director & CEO and Mr. ChirayuAmin Chairman of the Company will retire by rotation at the ensuing Annual GeneralMeeting and being eligible offer themselves for re-appointment.
The first term of office of Mr. Sameer Khera as Independent Director will expire on25th February 2020. The Nomination and Remuneration Committee and the Board ofDirectors at their respective meetings held on 15th May 2019 has recommendedhis re-appointment as Independent Director of the Company for a second term of 5 (five)consecutive years subject to the approval of the members by way of special resolution atthe ensuing Annual General Meeting.
The first term of Mr. R. C. Saxena as an Independent Director got completed on 12thAugust 2019. In view of his pre-occupations Mr. R. C. Saxena had requested the Board notto consider his candidature for the second term as an Independent Director.
During the year under review Mr. Milin Mehta Independent Director resigned from theBoard of the Company w.e.f. 30th January 2019 (close of working hours).
The Board has appointed Mr. Mayank Amin as an Additional Director (Independent) w.e.f.15th May 2019 and Ms. Rati Desai as an Additional Director (Independent)w.e.f. 13th August 2019. Both Mr. Mayank Amin and Ms. Rati
Desai hold office up to the ensuing Annual General Meeting of the Company. The Companyhas received a notice under Section 160 of the Companies Act 2013 from members of theCompany proposing the candidature of Mr. Mayank Amin and Ms. Rati Desai for the office ofan Independent Director for a term of 5 consecutive years upto 14th May 2024and 12th August 2024 respectively.
8 Key Managerial personnel:
Mrs. Malika Amin Managing Director and CEO Mr. Rasesh Shah CFO and Mr. DrigeshMittal Company Secretary are Key Managerial Personnel of the Company.
9 Meetings of the board:
Five (5) Board Meetings were held during the financial year ended 31stMarch 2019. The details of the Board Meetings with regard to their dates and attendanceof each of the Directors thereat have been provided in the Corporate Governance Report.
10 Independent Directors:
The Independent Directors of the Company have given the declaration and confirmation tothe Company as required under Section 149(7) of the Companies Act 2013 and Regulation25(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015confirming that they meet the criteria of independence and that they are not aware of anycircumstance or situation which exist or may be reasonably anticipated that could impairor impact their ability to discharge their duties with an objective independent judgmentand without any external influence.
11 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
- Fulfillment of the Independence Criteria and independence from the management
(b) For Non-Executive Non-Independent Directors:
- Knowledge and Skills
- Professional conduct
- Duties Role and functions
(c) 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.
12 Audit Committee:
During the year the Audit Committee consisted of Independent Directors with Mr. MilinMehta as Chairman and Mr. C. P. Buch and Mr. R. C. Saxena as members. After theresignation of Mr. Milin Mehta the Board of Directors at its meeting held on 15thMay 2019 reconstituted the Audit Committee and appointed Mr. C. P. Buch as the Chairmanand inducted Mr. Sameer Khera as a member. Further due to the retirement of Mr. R. C.Saxena on 12th August 2019 the Board of Directors at its meeting held on 13thAugust 2019 inducted Mr. Mayank Amin as a member. The Committee inter alia reviews theInternal Control System Reports of Internal Auditors and Compliance of variousregulations. The Committee also reviews at length the financial statements before they areplaced before the Board of Directors.
13 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 stakeholders toreport genuine concerns has been established. The same is also uploaded on the website ofthe Company.
14 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 withthe organization's pace of growth and increasing complexity of operations. The internalauditors' teams carry out extensive audits throughout the year across all locations andacross all functional areas and submits its reports to the Audit Committee.
15 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 31 stMarch 2019 in the format prescribed under Rule 9 of the Companies (Corporate SocialResponsibility Policy) Rules 2014 is annexed herewith as Annexure B.
16 policy on Nomination and Remuneration:
In compliance with the requirements of Section 178 of the Companies Act 2013 andRegulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the Company has laid down a Nomination and Remuneration policy which has beenuploaded on the Company's website. The web-link as required under Companies Act 2013 isas under: https://www.alembiclimited.com/policy/AL-NRC%20Policy. pdf The salient featuresof the NRC Policy are as under:
1) Setting out the objectives of the Policy.
2) Definitions for the purposes of the Policy.
3) Policy for appointment and removal of Director KMP and Senior Management.
4) Policy relating to the Remuneration for the Managerial Personnel KMP SeniorManagement Personnel & other employees.
5) Remuneration to Non- Executive / Independent Director.
During the year the Company has made changes in the policy to bring them in line withthe amendments in the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015.
17 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. In accordance with theapproval obtained from the members through Postal Ballot on 22nd March 2019the Company has entered into transactions with Alembic Pharmaceuticals Limited relatedparty. However no related party transactions have any potential conflict with theinterest 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.alembiclimited.com/AL-RPT%20Policy.pdf
18 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 Practicing CompanySecretaries confirming compliance with the conditions of corporate governance asstipulated under the aforesaid Schedule V is annexed to the Report on CorporateGovernance.
19 listing of shares:
The Equity Shares of the Company are listed on the BSE Limited (BSE) and National StockExchange of India Limited (NSE) with security ID/symbol of ALEMBICLTD. The Companyconfirms that the annual listing fees to both the stock exchanges for the financial year2019-20 have been paid.
20 loans Guarantee 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 C.
(a) Statutory Auditors:
M/s. CNK & Associates LLP Chartered Accountants (Firm Registration No. 10196W)were appointed as Statutory Auditors of the Company to hold office till the conclusion of115th AGM.
The Auditor's Report for financial year 2018-19 does not contain any qualificationreservation or adverse remark. The Auditor's Report is enclosed with the financialstatements 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.2019-20.
The Secretarial Audit Report of M/s. Samdani Shah & Kabra Practising CompanySecretaries for the financial year ended 31st March 2019 is annexed asAnnexure D.
The Secretarial Audit Report does not contain any qualification reservation or adverseremark.
During the year under review the Company has generally complied with all theapplicable provisions of the Secretarial Standards.
(c) Cost Auditors:
M/s. Santosh Jejurkar & Associates Cost Accountant Vadodara Cost Auditor of theCompany has been appointed as Cost Auditor for conducting audit of the cost accountsmaintained by the Company relating to Bulk Drugs and Real Estate Division for theFinancial Year 2019-20. The Company has made and maintained the cost records as specifiedby the Central Government under Section 148(1) of the Companies Act 2013.
(d) Internal Auditors:
The Board of Directors has appointed M/s. Sharp & Tannan Associates CharteredAccountants as Internal Auditors of the Company for the Financial Year 2019-20. TheCompany has in place a mechanism to identify assess monitor and mitigate various risksto key business objectives. Major risks identified by the businesses and functions aresystematically addressed through mitigating actions on a continuing basis. These arediscussed at the meetings of the Audit Committee and the Board of Directors of theCompany.
22 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 2019.Further it is hereby confirmed that there has been no change in the nature of business ofthe Company.
23 Extracts of Annual Return:
The extract of Annual Return required under Section 134(3) (a) of the Companies Act2013 read with Rule 12(1) of the Companies (Management and Administration) Rules 2014 isannexed herewith as Annexure E and has been uploaded on the Company's website. Theweb-link as required under Companies Act 2013 is as under:https://www.alembiclimited.com/#services
24 Conservation of Energy Technology Absorption Foreign Exchange Earnings andOutgo:
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 Annexure F.
25 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 G.
A statement showing the names and particulars of the employees falling within thepurview of Rules 5(2) and 5(3) of the aforesaid Rules are provided in the Annual Report.The Annual Report is being sent to the members of the Company excluding the aforesaidinformation. The said information is available for inspection at the Registered Office ofthe Company during working hours and the same will be furnished on request in writing tothe members.
26 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 H. 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.
27 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 31stMarch 2019 the applicable accounting standards have been followed along with properexplanation relating to material departures;
(b) the directors had selected such accounting policies as listed in Note 1 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 2019 and of theprofit of the Company for that period;
(c) the directors had 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 had prepared the annual accounts on a going concern basis; (e) thedirectors had laid down internal financial controls to be followed by the Company and thatsuch internal financial controls are adequate and were operating effectively; and
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
28 Other Disclosures:
(a) The Company does not have any scheme of provision of money for the purchase of itsown shares by employees or by trustees for the benefit of employees.
(b) The Managing Director of the Company has not received any remuneration orcommission from its subsidiary.
(c) No fraud has been reported by the Auditors to the Audit Committee or the Board.
(d) No significant Regulators or Courts or Tribunals which impact the going concernstatus and Company's operations in future.
(e) The Company has not invited/accepted any deposits from public.
(f) The Company has complied with the provisions relating to the constitution ofInternal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 to redress complaints received regardingsexual harassment.
| ||For and on behalf of the Board of Directors |
| ||Sd/- |
| ||Chirayu Amin |
| ||Chairman |
|Registered Office: ||(DIN: 00242549) |
|Alembic Road Vadodara - 390 003 || |
|Tel: +91 265 2280550 || |
|Fax: +91 265 2282506 || |
|Web: www.alembiclimited.com || |
|Email Id: email@example.com || |
|CIN: L26100GJ1907PLC000033 || |
|Date: 13th August 2019 || |
|Place : Vadodara || |