BDH Industries Limited
Your Directors have pleasure in presenting 31st Annual Report and AuditedFinancial Statements for the year ended 31st March 2021.
FINANCIAL RESULTS :
The financial performance of the Company is summarized below:-
| || ||(Rs. in Lakhs) |
|Particulars ||2020-21 ||2019-20 |
|Sales (Net) ||5745.23 ||5947.73 |
|Other Income ||130.24 ||79.56 |
|Total Income ||5875.47 ||6027.29 |
|Profit before Interest and Depreciation ||981.68 ||977.16 |
|Less : Interest ||28.20 ||68.90 |
|Depreciation ||78.94 ||96.24 |
|Profit before tax ||874.54 ||812.02 |
|Less : Provision for Taxation ||244.69 ||277.39 |
|Deferred Taxation ||(6.09) ||(9.61) |
|Net Profit After Tax ||635.94 ||594.24 |
The standalone financial statements are prepared in accordance with Indian AccountingStandards (Ind-AS) as prescribed under section 133 of the Companies Act 2013 (the Act)read with Rule 3 of the Companies (Indian Accounting Standards) Rules 2015 and theCompanies (Indian Accounting Standards) Amendment Rules 2016.
REVIEW OF OPERATIONS :
During the year 2020-21 Company achieved Sales (Net) of Rs. 5745.23 Lakhs as comparedto Rs. 5947.73 Lakhs in the previous year registering reduction of 3.40% over previousyear. The Operating Profit of the Company i.e. Profit before Interest and Depreciation hasincreased from Rs. 977.16 lakhs in previous year to Rs. 981.68 lakhs in 2020-21. TheCompany earned Net Profit after Tax of Rs. 635.94 lakhs during the year as against Rs.594.24 lakhs as in previous year a growth of 7% over previous year. An amount of Rs.95.39 Lakhs is transferred to the General Reserve from the net profit of the financialyear 2020-21.
Your Directors are pleased to recommend dividend of Rs. 3/- per equity share of facevalue Rs. 10/- each (previous year Rs. 2.50/- per share) for the financial year ended on31st March 2021. The dividend on Equity Shares is subject to the approval ofthe shareholders at the 31st Annual General Meeting. The total cash outflow onaccount of dividend payment will be Rs. 172.72 lakhs.
During the year under review the paid up equity share capital of the Company is asfollows:-
|Subscribed and Paid up share capital ||31st March 2021 ||31st March 2020 |
|5757300 Equity Shares of Rs. 10/- each fully paid up ||575.73 ||575.73 |
|Add : Forfeited Shares 364200 Equity Shares of Rs. 10/- each paid up to the extent of Rs. 5/- each ||18.21 ||18.21 |
Cancellation of equity shares forfeited by the Company:- In the past the Board ofDirectors had forfeited 364200 equity shares of Rs. 10/- each for non-payment of callmoney.While showing details of the equity share capital in the Balance sheet the detailsof forfeited shares also needs to be shown till the time these shares are either re-issuedor cancelled. Considering small quantum of the shares it is proposed to cancel theseshares. In such case The Board shall cancel the forfeited shares and transfer the amountreceived on such shares to capital reserve as per the applicable provisions of the IndianAccounting Standards and Companies Act 2013.
MATERIAL CHANGES & 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.
DIRECTORS AND KEY MANAGERIAL PERSONNEL :
The Board of Directors has six members. Ms. Jayashree Nair is the Chairperson andManaging Director of the Company. Mr. S. C. Kachhara is the Joint Managing Director andChief Financial Officer of the Company. There are three independent directors on the Boardof the Company Dr. Dinesh Variar Mr. Bhagirath Singh and Mr. Kairav Trivedi. There isone Non-Executive Director on the Board of the Company - Ms. Karthika Nair who retires byrotation at the forthcoming Annual General Meeting being eligible and offers herself forre-appointment. Accordingly the Board recommends her re-appointment. Ms. Jayashree NairManaging Director Mr. S. C. Kachhara Joint Managing Director and Chief Financial Officerand Ms. Nikita Phatak Company Secretary of the Company are the Key Managerial Personnelof the Company. During the year five Board meetings were held details of which are givenin the Corporate Governance Report.
DECLARATION BY INDEPENDENT DIRECTORS:
The Independent Directors of the Company - Dr. Dinesh Variar Mr. Bhagirath Singh andMr. Kairav Trivedi have submitted declaration complying with the criteria of independenceas provided in Section 149(6) of the Companies Act 2013. They have registered their namesin the Independent Directors data base. Based on the disclosures provided by them none ofthem are disqualified from being appointed as Director under section 164 of the Act andare independent from the Management.
CONFIRMATION ON INDEPENDENCE OF INDEPENDENT DIRECTORS
The Board of Directors confirm that the independent directors of the Company fulfillthe conditions specified in SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 and are independent of the management of the company.
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 have 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 2021 and ofthe Profit of the Company for the year ended 31st March 2021.
(c) The Directors have 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 have prepared the annual accounts on a going concern basis and
(e) The Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.
(f) The Directors have 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 certificate from Statutory Auditor forms part of thisAnnual Report. A declaration from Managing Director under regulation 34 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 is also attached to this report.
LISTING WITH STOCK EXCHANGE:
The equity shares of the Company are listed on BSE (Bombay Stock Exchange). The listingfee for year 2021-2022 has been paid by the Company.
NOMINATION AND REMUNERATION POLICY:
The Board has on the recommendation of the Nomination & 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 is hosted 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 relatedparties are disclosed in the notes to the financial statements. Form AOC-2 prescribedunder the Companies Act 2013 and Companies (Accounts) Rules 2014 is furnished as AnnexureV to this report. The Policy on Related Party Transactions is also hosted on the websiteof the Company www.bdhind.com.
VIGIL MECHANISM :
The Company has established a Vigil Mechanism i.e. Whistle Blower Policy to enable theDirectors 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 28thDecember 2020 evaluated the performance of the nonindependent directors and the Board as awhole. They also reviewed the performance of the Chairperson of the Company taking intoaccount the views of the Joint Managing Director and also assessed the quality quantityand timeliness of flow of information between the Company management and the Board thatwas necessary for the Board to 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.
FIXED DEPOSIT :
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.
INDUSTRIAL RELATIONS :
The Company has maintained cordial and harmonious relations with all its employees.
RESEARCH & DEVELOPMENT CENTRE :
R&D Centre of the Company is recognized and registered with Department of Scienceand Industrial Research (DSIR) Ministry of Science & Technology Government of India.The R&D centre is also approved under section 35 (2AB) of the Income Tax Act 1961 forthe purpose of weighted tax deduction. Research & Development being useful for thesustained growth of the Company investments in R&D are carried out to keep pace withchanging domestic and global scenario.With qualified and experienced research team theCompany has focused its thrust on development of new dosage forms and drug deliverysystems 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. Our manufacturing facilityis accredited with ISO 9001:2015 certification from SGS United Kingdom Limited. TheCompany conducts annual medical check-up programs first aid and fire safety sessions foremployees.
a. The Company has entered into power generation business and installation of two unitsof wind turbines 0.8 MW each has been completed at Jaisalmer district Rajasthan. SincePower Purchase Agreement (PPA) is not yet signed by State Government of Rajasthanalternate commercial proposals are being evaluated.
b. The Company has also entered into agro products business. The plantation of cashewmango and coconut grafts has been completed. The existing lease agreement was terminatedin July 2019 and the Company has invited applications for lease of the warehouse at MIDCKudal.
CORPORATE SOCIAL RESPONSIBILITY :
TheCompany is committed to good corporate citizenship. As a part of Corporate SocialResponsibility the Company has undertaken activities in the field of education. The CSRPolicy of the Company is placed on the website of the Company www.bdhind.com. During theyear the Company has supported educational projects undertaken by charitable trusts andsponsored a Research Project for translating lab-ideas into market ready products.Pursuant to the provisions of the Section 135(2) of the Companies Act 2013 the Report onCSR activities is enclosed as Annexure I of this report.
The Annual Return of the Company as on 31st March 2021 is placed on itswebsite at https://bdhind.com/pdf/Form- MGT-7-29-07-29.pdf
TRANSFER OF UNPAID/UNCLAIMED DIVIDEND AMOUNT AND SHARES TO INVESTOR EDUCATION ANDPROTECTION FUND (IEPF):
Pursuant to sections 124 and 125 of the Companies Act 2013 read with Investor Educationand Protection Fund (Accounting Audit Transfer and Refund) Rules 2016 (IEPF Rules)dividends if not claimed for a consecutive period of 7 years from the date of transfer tounpaid dividend account of the Company are liable to be transferred to the InvestorEducation and Protection Fund. Further shares in respect of such dividend which have notbeen claimed for a period of 7 consecutive years are also liable to be transferred to thedemat account of the IEPF Authority. As a proactive measure to safeguard the interest ofthe shareholders the Company sends reminder to the shareholders to claim their dividendsbefore transferring the same to IEPF Authority. Notices in this regard are also publishedin the newspapers uploaded on BSE website and the details of unclaimed dividend ofshareholders whose shares are liable to be transferred to the IEPF Authority are uploadedon the Company's website www.bdhind.com
The unclaimed dividend & shares transferred to IEPF during the year 2020-21 are asfollows:
|Financial Year ||Amount of unclaimed dividend transferred ||Number of shares transferred |
|2012-13 ||Rs. 514252/- ||338670 |
The Company has also uploaded the details of abovementioned shares on the website ofIEPF Authority www.iepf.gov.in The voting rights on the shares transferred to IEPFAuthority shall remain frozen till the rightful owner claims the shares.
Members may note that the shares and unclaimed dividend transferred to IEPF Authoritycan be claimed by filing online application in prescribed form no. IEPF 5 available onwww.iepf.gov.in and sending physical copy of same duly signed to the Company alongwithrequisite documents.
The unpaid/unclaimed dividend for the financial year 2013-14 onwards will betransferred to IEPF as given below:-
|Financial Year ||Date of Declaration ||Due date for transfer to IEPF |
|2013-14 ||17/09/2014 ||20/10/2021 |
|2014-15 ||28/09/2015 ||02/11/2022 |
|2015-16 ||22/09/2016 ||28/10/2023 |
|2016-17 ||27/09/2017 ||02/11/2024 |
|2017-18 ||25/09/2018 ||31/10/2025 |
|2018-19 ||18/09/2019 ||24/10/2026 |
|2019-20 ||27/08/2020 ||30/09/2027 |
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:
M/s. CLB & Associates Chartered Accountants (Firm Registration No. 124305W) arethe Statutory Auditors of the Company for a period of 5 years till the conclusion of theCompany's 32nd Annual General Meeting. The Auditors Report read with the notesto accounts are self-explanatory. There are no qualifications reservations or adverseremarks made by the Auditors. The Statutory Auditors have submitted No DisqualificationCertificate for the financial year 2021-22 to the Board of Directors of the Company.
Pursuant to the provisions of section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 M/s JHR &Associates Practicing Company Secretaries were appointed as the Secretarial Auditors forauditing secretarial records maintained by the Company for the financial year ended on 31stMarch 2021. The Secretarial Audit Report is annexed herewith to the Directors Report inAnnexure II. There are no qualifications reservations or adverse remarks made by theSecretarial Auditors.
Pursuant to the provisions of section 148 of the Companies Act 2013 and Companies(Audit and Auditors) Rules 2014 M/s. Krishna & Associates Cost Accountants (FirmRegistration No. 100939) were appointed as cost auditors to conduct the audit of the costrecords of the Company for the financial year 2020-21.The Cost Audit Report for financialyear 2019-20 was filed with Ministry of Corporate Affairs on 22 January 2021 within theprescribed time. The Cost Audit Report for the financial year 2020-21 shall be filed withMinistry of Corporate Affairs within the prescribed time.
RATIO OF REMUNERATION:
As required under Section 197(12) of the Companies Act 2013 read with Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the required detailsare given below:
|Directors ||Ratio to Median Remuneration |
|Ms. Jayashree Nair ||29:1 |
|Mr. S. C. Kachhara ||29:1 |
|Ms. Karthika Nair ||0.29:1 |
|Dr. Dinesh Variar ||0.39:1 |
|Mr. Bhagirath Singh ||0.50:1 |
|Mr. Kairav Trivedi ||0.50:1 |
b. There was no increase in remuneration of Ms. Jayashree Nair Managing Director andMr. S. C. Kachhara Joint Managing Director and Chief Financial Officer and percentageincrease in remuneration of Ms. Nikita Phatak Company Secretary is 13%
c. The median remuneration of employees increased by 17% in the financial year.
d. There are 128 permanent employees on the rolls of the Company.
e. The Company's PAT increased from Rs. 594.24 lakhs to Rs. 635.94 lakhs an increaseof 7% against which the average increase in median remuneration is 10% and this increaseis aligned with the Company's Remuneration Policy.
f. The aggregate remuneration of key managerial personnel (KMP) is Rs. 160.87 lakhsrevenue of the Company during the year is Rs. 5875.47 lakhs & the remuneration of KMPis 2.73% of revenue.
g. The market capitalization of the Company as on 31st March 2021 was Rs.53.17 crores as compared to Rs. 30.83 crores as on 31st March 2020 it was. ThePE ratio of the Company as on 31st March 2021 was 8.35 and as on 31stMarch 2020 it was 5.19. The Company made public offer of equity shares (of face value Rs.10/- each share) at premium (of Rs. 30/- each share) in the year 1995.
h. The average percentile increase in salaries of employees other than managerialpersonnel is 10% and there was no increase in remuneration of Ms. Jayashree Nair ManagingDirector and Mr. S. C. Kachhara Joint Managing Director and Chief Financial Officer andpercentage increase in remuneration of Ms. Nikita Phatak Company Secretary is 13%.
i. There is no variable component linked to various parameters - financial andnon-financial in the remuneration availed by the directors.
j. During the year there was no employee who is not a director of the Company andreceived remuneration in excess of the highest paid directors.
k. We affirm 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 work place. The Company has not received anycomplaint during the year ended 31st March 2021 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 |
| ||Jayashree Nair |
|Mumbai 28th June 2021 ||Chairperson & Managing Director |