BDH INDUSTRIES LIMITED
Your Directors have pleasure in presenting 27th Annual Report and AuditedFinancial Statements for the year ended 31st March 2017.
FINANCIAL RESULTS :
The financial performance of the Company is summarized below :-
| || ||(` in Lakhs) |
|Particulars ||2016-17 ||2015-16 |
|Sales (Gross) ||4463.21 ||4672.82 |
|Sales (Net) ||4367.64 ||4612.87 |
|Other Income ||124.40 ||179.57 |
|Total Income ||4492.04 ||4792.44 |
|Profit before Interest and Depreciation ||604.90 ||587.90 |
|Less : Interest ||34.76 ||33.42 |
|Depreciation ||71.66 ||73.40 |
|Profit before tax ||498.48 ||481.08 |
|Less : Provision for Taxation ||172.82 ||162.91 |
|Deferred Taxation ||(8.00) ||(4.45) |
|Net Profit After Tax ||333.66 ||322.62 |
REVIEW OF OPERATIONS :
During the year 2016-17 Company achieved Sales (Net) of ` 4367.64 Lakhs as compared to` 4612.87 Lakhs in the previous year registering decline by 5.31% over previous year. TheOperating Profit of the Company i.e. Profit before Interest and Depreciation has increasedfrom ` 587.90 lakhs in previous year to ` 604.88 lakhs in 2016-17. The Company earned NetProfit after Tax of ` 333.66 lakhs during the year as against ` 322.62 lakhs as inprevious year a growth of 3.4% over previous year. An amount of ` 50 Lakhs fromthe netprofit of the financial year of the year under review is transferred to the GeneralReserve.
MATERIAL CHANGES AND COMMITMENTS AFTER THE END OF THE FINANCIAL YEAR:
No material changes or commitments affecting the financial position of the Company haveoccurred between the end of the financial year to which financial statements in thisreport relate and the date of the report.
CHANGE IN THE NATURE OF BUSINESS IF ANY:
The Company continues to operate in one segment i.e. pharmaceuticals and there is nochange in the nature of business of the Company.
Your Directors are pleased to recommend dividend of ` 2/- per equity share of ` 10/-each (previous year ` 2/- per share) for the financial year ended on 31stMarch 2017. The dividend on Equity Shares is subject to the approval of the shareholdersat the Annual
General Meeting. The total cash outflow on account of dividend payment includingdistribution tax will be ` 139.59 lakhs.
DIRECTORS AND KEY MANAGERIAL PERSONNEL :
There were no changes in the Directors and Key Management Personnel during the year.The Board of Directors at present has six members Ms. Jayashree Nair is the Chairpersonand Managing Director of the Company. Mr. S. C. Kachhara is the Joint Managing
Director and Chief Financial Officer of the Company. There are three independentdirectors on the Boardof the Company Mr. A. V.
Menon Dr. Dinesh Variar and Mr. Bhagirath Singh Sihag. There is one Non-ExecutiveDirector on the Board of the Company Ms. Karthika Nair who retires by rotation atthe forthcoming Annual General Meeting being eligible and offer herself forre-appointment. Accordingly the Board recommends her re-appointment. Ms. Jayashree NairManaging Director Mr. S. C. Kachhara Joint Managing
Director and Chief Financial Officer and Ms. Nikita Phatak Company Secretary of theCompany are the Key Managerial Personnel of the Company. During the year five Boardmeetings were held details of which are given in the Corporate Governance Report.
DECLARATION BY INDEPENDENT DIRECTORS:
The Independent Directors of the Company Mr. A. V. Menon Dr. Dinesh Variar andMr. Bhagirath Singh Sihag have submitted declaration complying with the criteria ofindependence as provided in Section 149(6) of the Companies Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 134(5) of the Companies Act 2013 the Directors state that :-
(a) In the preparation of the annual accounts the applicable accounting standards havebeen followed alongwith proper explanation relating to 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 as at 31st March 2017 and ofthe
Profit of the Company for the year ended 31st March 2017.
(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) adequate and were operating effectively.
(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.
The Company has complied with the requirements of Corporate Governance. A report onCorporate Governance together with a
. A declaration from Managing Director under regulation 34 of SEBI
(Listing Obligations and Disclosure Requirements) Regulations 2015 is also attached tothis report.
LISTING WITH STOCK EXCHANGE:
The equity shares of the Company are listed on BSE Limited. The listing fee for year2017-2018 has been paid by the Company.
NOMINATION AND REMUNERATION POLICY:
The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The details of the Nomination and Remuneration Policy are covered in theCorporate Governance Report. The said policy has also uploaded on the Company's website atwww.bdhind.com.
RISK MANAGEMENT POLICY:
The Company has adopted a Risk Management Policy to identify and categorize variousrisks implement measures to minimize impact of these risks and a process to monitor themon regular basis.
RELATED PARTY TRANSACTIONS:
There were no materially significant related party transactions during the year thathave potential conflict with the interests of the
Company. The transactions with related parties are disclosed in the notes to thefinancial statements the Companies Act 2013 and Companies (Accounts) Rules 2014 isfurnished as Annexure V to this report. The Policy on Related Party Transactions is alsohosted on the website of the Company www.bdhind.com.
The Company has established a Vigil Mechanism i.e. Whistle Blower Policy to enable thethe Directors and employees to report to the Audit Committee genuine concerns unethicalbehavior and irregularities if noticed by them in the Company which could adverselyaffect Company's operations. The Whistle Blower Policy is also hosted on the website ofthe Company www.bdhind.com. During the year no concerns or irregularities have beenreported by the employees or directors.
FORMAL ANNUAL EVALUATION:
As required under the Schedule IV of the Companies Act 2013 and Clause 49(II) (B)(6) ofthe Listing Agreement the Independent Directors at their separate meeting held on 14thNovember 2016 evaluated the performance of the non-independent directors and the Board asa whole. They also reviewed the performance of the Chairperson of the Company taking intoaccount the views of the
Executive Director and also assessed the quality quantity and timeliness of flow ofinformation between the Company management and the Board that was necessary for the Boardto effectively and reasonable perform their duties.
The Board assessed the performance of the independent directors as per the criterialaid down and have recommended their continuation on the Board. The Board of Directorsassessed the performance of individual directors on the Board based on parameters such asrelevant experience and skills focus on shareholder value creation governance standardsknowledge of business processes and procedures followed integrity relationship withManagement impact on key management decisions etc.
INTERNAL FINANCIAL CONTROLS:
The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation were observed.
The Company has not invited / accepted any deposits during the year under review asenvisaged under sections 73 74 and 76 of the
Companies Act 2013.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
The Company has not made any loans to any third party as envisaged under section 186 ofthe Companies Act 2013. The Company has not given any guarantee other than bank guaranteein the normal course of business to meet the contractual obligations. The Board ofDirectors have authorized the Company to invest the surplus in deposits with Banks.
SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS:
During the year under review there have been no significant and material orders passedby any regulators / courts / tribunals that could impact the going concern status and theCompany's operations in future.
CONSERVATION OF ENERGY AND TECHNOLOGY UPGRADATION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:
Pursuant to Section 134(3)(m) of the Companies Act 2013 read with Rule 8 of theCompanies (Accounts) Rules 2014 particulars of energy conservation technology absorptionand foreign exchange earnings and outgo are appended hereto as Annexure IV and forms partof the Annual Report.
The properties and assets of your Company are adequately insured.
The Company has maintained cordial and harmonious relations with all its employees.
RESEARCH & DEVELOPMENT :
Research & Development is crucial for the sustained growth of the Company. TheCompany added investments for R&D facility to keep pace with changing domestic andglobal scenario. The Company is also planning to apply for recognition of R&D Centrewith
Department of Scientific and Industrial Research (DSIR). With qualified and experiencedresearch team the Company has focused its thrust on development of new dosage forms anddrug delivery systems improvement in processes and yield and cost reduction.
ENVIRONMENT HEALTH & SAFETY:
The Company is committed to environment protection and industrial safety. Ourmanufacturing facility has been accredited with WHO-GMP and complies with applicableenvironment regulations of Maharashtra Pollution Control Board (MPCB). Our manufacturingfacility is accredited with ISO 9001:2015 certification from SGS United Kingdom Limited.The Company conducts medical check-up programs first aid sessions and fire safetysessions for employees.
NEW PROJECTS : a. The Company has entered into power generation business and theinstallation of two units of wind turbines 0.8 MW each has been completed at Jaisalmerdistrict Rajasthan. However the Power Purchase Agreement (PPA) is yet to be executed byState of Rajasthan and hence commercial operations shall commence after signing of PPA. b.The Company has also entered into agro products business. The plantation of cashew mangoand coconut grafts has been completed and construction of warehouse at Kudal Sindhudurgdistrict in Maharashtra has been completed. The commercial operations are yet to commence.
EXTRACT OF ANNUAL RETURN:
The Extract of Annual Return of the Company as on 31st March 2017 isattached herewith as Anexure I to this report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
The Management Discussion and Analysis Report as required under Schedule V of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 is included in thisAnnual Report.
AUDITORS AND AUDITORS' REPORT: STATUTORY AUDIT:
M/s. L. J. Kothari & Co. Chartered Accountants (Firm Registration No. 105313W)retire at the ensuing Annual General Meeting and pursuant to the provisions of the section139(2) of the Companies Act 2013 they are not eligible to be re-appointed as the Auditorsof the Company. The Board places on record its appreciation for the services rendered byM/s. L. J. Kothari & Co. Chartered Accountants as Statutory Auditors of the Companyfor all these years.
In their place it is proposed by the Company to appoint M/s. CLB & AssociatesChartered Accountants (Firm Registration No.
124305W) as the Statutory Auditors of the Company for a period of 5 years till theconclusion of the Company's 32nd Annual General Meeting and the necessaryresolution in this regard is proposed to be passed by the members of the Company at theensuing Annual General Meeting.
The Auditors Report read with the notes to accounts are self-explanatory. There are noqualifications reservations or adverse remarks made by the Auditors.
Pursuant to the provisions of section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Mangerial
Personnel) Rules 2014 M/s JHR & Associates Practising Company Secretaries wereappointed as the Secretarial Auditors for auditing secretarial records maintained by theCompany for the financial year ended on 31st March 2017. The Secretarial AuditReport is annexed herewith to the Directors Report in Annexure II. There are noqualifications reservations or adverse remarks made by the
RATIO OF REMUNERATION:
As required under Section 197(12) of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnal) Rules 2014 the required detailsare given below
|a. Directors ||Ratio to median Remuneration |
|Ms. Jayashree Nair ||26:1 |
|Mr. S. C. Kachhara ||26:1 |
|Mr. A. V. Menon ||0.40:1 |
|Dr. Dinesh Variar ||0.31:1 |
|Mr. Bhagirath Singh Sihag ||0.40:1 |
|Ms. Karthika Nair ||0.31:1 |
b. The percentage increase in remuneration of Ms. Jayashree Nair Managing Director is10% Mr. S. C. Kachhara Joint Managing Director and Chief Financial Officer is 10% (asapproved by members in 23rd Annual General Meeting) and Ms. Nikita PhatakCompany Secretary is 9%. c. The median remuneration of employees increased by 9% in thefinancial year. d. There are 135 permanent employees on the rolls of the Company. e. TheCompany's PAT increased from ` 322.62 lakhs to ` 333.66 lakhs an increase of 3.4% againstwhich the average increase in remuneration is 9% and this increase is aligned with theCompany's Remuneration Policy. f. The aggregate remuneration of key managerial personnel(KMP) is ` 108.66 lakhs revenue of the Company during the year is
` 4463.21 lakhs and the remuneration of KMP is 2.43% of revenue. g. The marketcapitalization of the Company as on 31st March 2017 was ` 45.08 crores and ason 31st March 2016 was ` 47.79 crores. The PE ratio of the Company as on 31stMarch 2017 was 13.50 and as on 31st March 2016 was 14.82. The Company madepublic offer of equity shares (of face value ` 10/- each share) at premium (of ` 30/- eachshare) in the year 1995. h. The average percentile increase in salaries of employees otherthan managerial personnel is 9% and increase in managerial remuneration is 10% as approvedby members at the 23rd Annual General Meeting. i. There is no variablecomponent linked to various parameters financial and non-financial in the remunerationavailed by directors. j. During the year there was no employee who is not a director ofthe Company and received remuneration in excess of the highest paid directors. k. Weaffirm that the remuneration paid is as per Remuneration Policy of the Company.
The Company has an internal complaints committee under the Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 for prevention and redressalof complaints of sexual harassment at workplace. The Company has not received anycomplaint during the year pursuant to the said Act.
Your Directors thank statutory authorities and bankers for co-operation extended bythem to the Company. Your Directors place on record their sincere appreciation of thecontinued support by the employees and finally thank the shareholders for the trust placedby them with the Company.
| ||FOR AND ON BEHALF OF THE BOARD |
|Place : Mumbai ||Jayashree Nair |
|Date : 29th May 2017 || |
Chairperson & Managing Director
Registered Office :
Nair Baug Akurli Road Kandivli (East) Mumbai 400101
Tel. No. :022-61551234 l Fax No. :022-28868349
Email firstname.lastname@example.org l Website : www.bdhind.com