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Ambalal Sarabhai Enterprises Ltd.

BSE: 500009 Sector: Health care
NSE: AMBASARABH ISIN Code: INE432A01017
BSE 00:00 | 28 Feb 17.80 -0.90
(-4.81%)
OPEN

18.95

HIGH

19.00

LOW

17.80

NSE 05:30 | 01 Jan Ambalal Sarabhai Enterprises Ltd
OPEN 18.95
PREVIOUS CLOSE 18.70
VOLUME 42388
52-Week high 21.60
52-Week low 9.05
P/E 48.11
Mkt Cap.(Rs cr) 136
Buy Price 17.80
Buy Qty 200.00
Sell Price 17.80
Sell Qty 600.00
OPEN 18.95
CLOSE 18.70
VOLUME 42388
52-Week high 21.60
52-Week low 9.05
P/E 48.11
Mkt Cap.(Rs cr) 136
Buy Price 17.80
Buy Qty 200.00
Sell Price 17.80
Sell Qty 600.00

Ambalal Sarabhai Enterprises Ltd. (AMBASARABH) - Director Report

Company director report

To

The Shareholders

The Directors hereby present their 40th Annual Report together with the AuditedFinancial Statements of the Company for the year ended March 31 2018.

(Rs. lakh)
2017-18 2016-17
(Consolidated accounts)
Turnover (Net) 12562 13634
Other Income 2504 622
Total Income 15066 14256
Financial Cost 336 471
Depreciation 212 427
Profit/Loss before extra ordinary Income 796 (1362)
Net Profit/(Loss) before taxation 796 (1362)
Net Profit (Loss) 110 (1911)

Your directors regret their inability to recommend payment of any dividend.

Consolidated Results :

The Company's strategy of moving each business into a focused subsidiary has led tobetter growth and has seen success over the past few years. While the Company shows aslight decrease in sales considering other income the Company has shown a profit of Rs7.96 crores. As a result of the IND AS the sales of our joint venture company are now notincluded in overall sales.

Sarabhai Chemicals (India) Pvt. Ltd.

Sarabhai Chemicals a subsidiary company has made inroads in the domestic market withkey strategic products in Oncology Infertility and Uro-gynaec areas. These threesub-division of the company are marketing speciality pharmaceutical products under theSarabhai house mark across India

Asence Group

Asence Inc a wholly-owned subsidiary of the Company specializes in the supply ofquality pharmaceuticals preparations (Finished Dosage Forms and Active PharmaceuticalIngredients) to the international markets.

Asence is concentrating on its exports business along with its domestic sales andsetting up a new finished dosage manufacturing plant which will be operational in the 1stquarter of the year 2019.

Suvik Hitek Pvt. Ltd.

Suvik a wholly owned subsidiary of the Company is manufacturing Pharmaceuticalproducts and marketing various generic products and veterinary products in the domesticmarket.

Synbiotics Limited

Synbiotics is a USFDA inspected manufacturing company in the fermentation area. Itmanufactures an antifungal active ingredient product which has an expanding global market.

Systronics (India ) Limited

It has two divisions Systronics & Telerad.

SYSTRONICS is a leading manufacturer of Analytical and Test & Measuringinstruments distributing its products in India.

TELERAD is one of the oldest representatives of SONY in India promoting Broadcast andProfessional Video/Audio products of various international companies.

Sarabhai M. Chemicals Ltd.

Sarabhai M Chemicals ltd a wholly owned subsidiary company will start its Vitamin Ccoated products manufacturing in the year 2019.

Joint Venture Companies:

Vovantis Laboratories Pvt. Ltd.

Vovantis a joint venture company is a USFDA inspected effervescent productmanufacturing company with increased focus on the USA and European markets.

Cosara Diagnostics Pvt.Ltd .

Cosara Diagnostics is a new company promoted by Synbiotics Limited in partnership withCo-diagnostics of USA to manufacture and market molecular diagnostics products globally.

Corporate Governance:

Pursuant to provisions of SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 Management Discussion and Analysis Report Corporate Governance Reportand Auditors' Certificate regarding Compliance of Conditions of Corporate Governance aremade part of the Annual Report.

Subsidiaries:

The Company has 8 owned subsidiaries and two joint venture and one associate company.Their performance is integrated in the consolidated accounts.

Consolidated financial Statement:

In compliance of the Accounting Standard AS-21 on Consolidated Financial Statement theConsolidated Financial Statements which from part of the Annual Report and Accounts areattached herewith.

Directors and Key Managerial Personnel:

Pursuant to the provisions of Section 152 of the Companies Act 2013 Mr. K. Mohandaswho retires by rotation and being eligible offers himself for the appointment.

The three whole time directors namely Mr. Anil. H. Parekh Ms. Chaula Shastri and Mr.Kartikeya. V. Sarabhai have been reappointed by the Board for a further period of threeyears. These resolutions are proposed for your approval in the ensuing AGM.

Declaration by Independent Directors:

The independent Directors have submitted the declaration of independence as requiredpursuant to Section 149(7) of the Companies Act 2013 stating that they meet the criteriaof independence as provided in sub-section(6)

The five year term of Independent directors will come to an end on 31st March 2019.Theresolutions for reappointment for a further term of five years in respect of Mr. Ashwin PHathi Mr. Chandra Shekhar Bohra and Mr.G D Zalani are proposed for your approval .

Annual 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 Board of India (SEBI) underListing Regulations.

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 committees meetings etc.

The Board and the Nomination and Remuneration Committee (NRC) reviewed the performanceof the individual Directors on the basis of the criteria such as the contribution of theindividual Director to the Board and Committee Meetings like preparedness on the issued tobe discussed meaningful and constructive contribution and inputs in meetings etc Inaddition the Chairman was also evaluated on the key aspects of his role.

Particulars of Loans Guarantees or Investments:

Information regarding loans guarantees and Investments covered under the provisions ofsection 186 of the Companies Act 2013 are detailed in the financial statements.

Related Party Transactions:

Since all the related party transactions are carried out in the ordinary course ofbusiness on arm's length basis such transactions entered into by the Company during thefinancial year did not attract the provisions of Section188 of the Companies Act 2013 .There is no material related party transaction. The detail to be disclosed in Form AOC-2is attached.

During the year 2017-18 pursuant to section 177 of the Companies Act213 and SEBI(LODR) Regulations 2013 all RPTs were placed before Audit Committee for its prior/omnibus approval.

Material Changes and Commitments:

There have been no material changes and commitments affecting the financial positionof the Company which have occurred between the end of the financial year of the Companyand the date of this Report.

Number of Meetings of the Board:

There were 7 meetings of the Board held during the year. Detailed information is givenin the Corporate Governance Report.

Extract of Annual Return:

Extract of Annual Return as provided under sub-section (3) of section 92of theCompanies Act 2013 in the prescribed form MGT-9 is annexed to this Report.

Policy on Director's Appointment and Remuneration and other details:

The Company's policy on director's appointment and remuneration and other mattersprovided in Section 178(3) of the Act has been followed by Nomination and RemunerationCommittee while recommending appointment of Directors or key Managerial Personnel. Theyhave fixed criteria for appointment of directors and key Managerial Persons. Every yeartheir performance is evaluated by the committee and accordingly suitable recommendationsare made.

Internal Financial Control Systems and their adequacy:

The Company has an Internal Control System commensurate with size scale and complexityof its operations. The Company has appointed an Independent internal Auditor who carriesout Internal auditing works according to policies and rules framed to monitor and controlfinancial transactions within the company and submits his report at every quarter which isput before the Audit Committee for their perusal.

Audit Committee:

The details pertaining to composition of Audit Committee are included in the CorporateGovernance Report with forms part of this report.

Auditors' Report and Secretarial Auditors' Report:

Auditors' report does not contain any qualifications reservations or adverse remarks.Report of the Secretarial Auditor is given as an annexure which forms part of this report.

Risk Management:

The Audit committee of the Company is assigned the task to frame implement and monitorthe risk management plan for the Company. The Committee is responsible for reviewing therisk management plan and ensuring its effectiveness. The Audit Committee has additionaloversight in the area of financial risks and controls. Major risks identified by thebusiness and functions are systematically addressed through mitigating actions on acontinuing basis.

Corporate Social Responsibility:

Since Company incurred losses for the last financial year (2016-17) and has no profitsfrom its business operations during last three years the provisions relating to corporatesocial Responsibility are not attracted.

Particulars of Employees:

The information required under Section 197 of the Act read with the rule 5(1) of theCompanies (Appointment and Remuneration of Management Personnel) Rules 2014 will beprovided upon request in terms of section 136 of the Act the reports and accounts arebeing sent to the members and others excluding the information on employees' particularswhich is available for inspection by members at the registered office of the companyduring 2.00 p.m. to 4.00 p.m. on working days of the Company upto the date of AGM. If anymember is interested in obtaining a copy thereof he/she may write to SecretarialDepartment of the Company. There is no employee drawing salary in excess of limitprescribed in Rule 5(2) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014.

Fixed Deposits:

The Company has not accepted any fixed deposit during the year neither there was anyunpaid/unclaimed amount of deposit at the beginning of the year or at the end of the year.

Details of Significant Orders passed by Regulators or Courts:

There is no significant or material order passed by any regulators or courts during thefinancial year.

Disclosure Pursuant o section 197(14) of the Companies Act 2013:

No Whole time director of the company was in receipt of any remuneration or commissionfrom the company's holding or subsidiary companies during the financial year.

Details of Establishment of Vigil Mechanism:

The company has formulated a Whistle Blower Policy to establish a vigil mechanism fordirectors and employees of the company to report concerns about unethical behaviouractual or suspended fraud or violation of company's code of conduct policy.

Disclosure under Sexual Harrassment of Women at Workplace (Prevention Prohibition andRedressal ) Act 2013:

The company has established Internal Complaints committee to redress the complaintsreceived from any woman employee of the company as required under the provisions of Act.

Fraud Reporting:

There was no fraud reporting by the Auditors of the company under section 143(12) ofthe Companies Act 2013 to the Audit Committee or the Board of Directors during the yearunder review.

Energy Conservation Technology Absorption and Foreign Exchange earnings and outgo:

Particulars of Energy Conservation Technology Absorption and foreign Exchange Earningsand outgo required to be given are given in the Annexure to this Report in the prescribedformat.

Directors' Responsibility Statement:

As required under Section 134(5) of the Companies Act 2013 we hereby state:

(i) That in the preparation of the annual accounts the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures if any.

(ii) That the Director have selected such accounting policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive true and fair view of the state of affairs of the Company as at 31st March 2018.

(iii) That the Directors have taken proper and sufficient care of the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act forsafeguard in the assets of the Company and for preventing and detecting fraud and otherirregularities.

(iv) That the Directors have prepared the annual accounts on a going concern basis.

(v) That the directors have laid down Internal Financial Controls to be followed by theCompany and that such Internal Financial Controls are adequate and were operatingeffectively.

(vi) That the Directors have devised proper system to ensure compliances with theprovisions of all applicable laws and the systems are adequate and operating effectively.

Insurance:

Building Plant and machinery and stocks have been adequately insured. The companycarries a risk for certain assets like goods in transit in respect of which any lossresulting from non-insurance is small because of fairly large drop in production andsales.

Statutory Auditors:

Pursuant to Section 139 of the Companies Act 2013 and the Rules made there under M/sKhandhar & Associates are appointed as Auditors by the member in their last AGM heldon 29-9-2017 to hold office until the conclusion of the 44th Annual General Meeting to beheld in the year 2021-22.

Acknowledgement:

Your Directors would like to take this opportunity to express their deep sense ofgratitude to the banks Government Authorities Customers and Shareholders for theircontinuous guidance and support. Further they would also like to place on record theirsincere appreciation for the dedication and hard work put in by one and all members ofSarabhai Pariwar including workers.

For and on behalf on the Borad
Ahmedabad Kartikeya V Sarabhai
14-8-2018 Chairman