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Beta Drugs Ltd.

BSE: 535022 Sector: Health care
NSE: BETA ISIN Code: INE351Y01019
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Beta Drugs Ltd. (BETA) - Director Report

Company director report

To

The Members of

BETA DRUGS LIMITED

Your Directors take pleasure in presenting the 13thAnnual Report of theCompany together with the Audited Accounts for the financial year ended on 31stMarch 2018. The Management Discussion anc Analysis has also been incorporated in thisreport.

• FINANCIAL SUMMARY/HIGHLIGHTS:

The brief financial results are as under:

PARTICULARS YEAR ENDED 31.03.2018 YEAR ENDED 31.03.2017
Revenue from Operations 505667871.26 416526679.29
Other Income 2443898.26 290363.06
Total Revenue 508111769.52 416817042.35
Less: Other expenses excluding depreciation 421248142.91 351923268.22
Less: Depreciation & Preliminary expenses written off 18506706.56 12383943.36
Profit / (loss) before Taxation 68356920.05 52509830.77
Less : Provision for Taxation
Current Tax 0 10706151.00
Deferred Tax 720255.20 (888233.00)
Profit/ (loss) after Taxation 67636664.85 42691912.77

• DIVIDEND:

In order to conserve the financial resources for the future requirement of the companythe Board of Directors has not recommended any dividend for the year.

• TRANSFER TO RESERVE:

Profit of Rs. 67636664.85 was transferred to surplus a/c.

• STATEMENT OF COMPANY'S AFFAIRS

During the year Revenue of the Company increased by 21.90% i.e. from Rs. 4168.17 lakhsto Rs.5081.11 lakhs. Profit before tax increase by 30.17% i.e. from Rs. 525.09 lakhs toRs.683.56 lakhs. Profit after tax increase by 58.42% to Rs. 676.36 lakhs from Rs. 426.91lakhs.

• CHANGE IN THE NATURE OF BUSINESS:

During the year the Company has not changed its business.

• MATERIAL CHANGES:

The company had came out with a public issue of 2296000 equity shares at a price ofRs. 85 each including a share premium of Rs. 75 per equity share. The IPO was a hugesuccess and the resulting shares have been listed on the NSE emerge platform of NSEMumbai. Other than this there are no Material change occurred between the end of thefinancial year of the company to which the financial statements related and the date ofthe report which is affecting the financial position of the company.

• SUBSIDIARY COMPANIES/JOINT VENTURE COMPANY/ASSOCIATE COMPANY:

The Company does not have any Subsidiary Companies or Joint Venture Company orAssociate Company.

• REASONS FOR REVISION OF FINANCIAL STATEMENT OR REPORT:

During the year the financial statement or report was not revised. Hence furtherdetails are not applicable.

• INCREASE IN AUTHORISED SHARE CAPITAL:

During the year under review the Company has increased authorised share capital fromRs. 10100000 (Rupees One Crore one lac only) divided in to 1010000 (Ten lac tenthousand) Equity Shares of Rs. 10 each ; to Rs. 100000000 (Rupees Ten Crore only)divided in to 10000000 (One Crore) Equity Shares of Rs. 10 each.

• ALLOTMENT OF SHARES UNDER BONUS ISSUE:

The Company has allotted 4949000 Equity Shares of Rs. 10 each during the year underreview as Bonus share in the ratio of 4.9 Equity Shares of Rs. 10 each for every 1 Equityshares of Rs. 10 each held by the existing Shareholders of the Company.

• ALLOTMENT OF SHARES UNDER RIGHT ISSUE:

The Company has allotted 394500 Equity Shares of Rs. 10 each during the year underreview as Right Issue at a price of Rs 74/- each including premium of Rs 64/- per share ofan aggregate value of Rs. 29193000 (Rupees Two Crore Ninety One Lac Ninety Threethousand only).

• CONVERSION OF THE COMPANY:

During the year the company has been converted from Private Limited Company to PublicLimited Company and necessary fresh certificate to that effect has been issued by theRegistrar of Companies Himachal Pradesh dated 11th August 2017. Consequent toconversion of the company the name of the company has been changed from Beta Drugs PrivateLimited to Beta Drugs Limited.

• SUCCESSFUL INITIAL PUBLIC OFFERING:

During the year under review the Company came out with an Initial Public Offer (IPO)of 2296000 Equity Shares of Rs. 10/- each for cash at a price of Rs. 85/- per EquityShare including a share premium of Rs.75/- per Equity Share vide prospectus dated 19thSeptember2017 with a lot size of 1600 shares. The Company has successfully completed theInitial Public Offering (IPO) during the year pursuant to the applicable SEBI Rules andRegulations. The IPO opened on 29th September 2017 and closed on 4thOctober 2017. The IPO of the Company received an encouraging response from the investorsand the public issue was oversubscribed. The Equity Shares of the Company have been listedon SME Platform of NSE Limited w.e.f 12th October 2017. The Equity shares ofthe Company as listed on SME platform of NSE Limited have a regular and continuoustrading. The Company confirmed it has paid Annual Listing Fees due to the National StockExchange for the year 2018-19.

• DEPOSITORY SYSTEM

As the Members are aware your Company's shares are trade-able compulsorily inelectronic form and your Company has established connectivity with both NationalSecurities Depository Limited (NSDL) and Central Depository Services (India) Limited(CDSL). In view of the numerous advantages offered by the depository system the membersare requested to avail the facility of dematerialization of the Company's shares on NSDL& CDSL. The ISIN allotted to the Company's Equity shares is INE351Y01019.

• UTILISATION OF IPO PROCEED:

Utilization of proceed by the Company till March 2018 raised from IPO is detailedbelow:

PARTICLUAR HEAD AMOUNT
AMOUNT RECEIVED - SHARE CAPITAL AND PREMIUM 195160000.00
EXPENSES
IPO EXPENSES ISSUE EXPENSES 29850000.00
IPO EXPENSES GENERAL CORPORATE EXPENES 7094316.00
TRFD. TO VIJAYA C/C (FOR WORKING CAPITAL) WORKING CAPITAL 30000000.00
BALANCE WITH AXIS BANK UNUTILISED 7536952.50
BALANCE RBL BANK UNUTILISED 4878742.91
BALANCE WITH ICICI BANK UNUTILISED 1690558.59
FDR WITH AXIS UNUTILISED 72000000.00
FDR WITH SIDBI GENERAL CORPORATE EXPENES 3400000.00
FDR WITH VIJAYA UNUTILISED 9000000.00
BUILDING CIVIL CONSTRUCTION 6466264.00
GENERAL CORPORATE EXPENES GENERAL CORPORATE EXPENES 2750661.00
MACHIENRY PAYMENT (ADVANCE) PURCHASE OF MACHINERY (ADVANCE) 9898700.00
MACHIENRY CAPITALISED PURCHASE OF MACHINERY 8344785.00
LAND GENERAL CORPORATE EXPENES 2249020.00
fOTAL 195160000

• DIRECTORS & KEY MANAGERIAL PERSONNEL:

Pursuant to the provisions of Section 152 of the Companies Act 2013 Mr. Rahul Batra(DIN: 02229234) and Mr. Balwant Singh (DIN: 01089968) Directors of the Company retires byrotation at the ensuing Annual General Meeting and being eligible has offeredhimself/herself to be reappointed as Directors of the Company.

The Board recommends the re-appointment of Mr. Rahul Batra (DIN: 02229234) and Mr.Balwant Singh (DIN: 01089968) as Directors of the Company liable to retire by rotation.

During the year under review Mr Rohit Parti (DIN:-07889944) Mr. Nipun Arora (DIN:05333399) & Mr Manmohan Khanna (DIN :-07888319) were appointed as Additional Directoras well as Independent Directors of the Company for 5 years w.e.f. 26th July2017 at the Board of Directors Meeting subject to the approval of shareholders in theensuing Annual General Meeting.

Mrs. Rajni Brar was appointed as Company Secretary and Mr. Jayant Kumar was appointedas CFO of the Company w.e.f. 17th July 2017.

• DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the requirement of section 134(5) of the Companies Act 2013 with respectto Directors' Responsibility Statement it is hereby confirmed:

1. that in the preparation of the annual accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures;

2. that the Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are 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 that period;

3. that the Directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

4. that the Directors had prepared the annual accounts on a going concern basis; and

5. that the directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

6. that the directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.

• FORMAL EVALUATION BY BOARD OF ITS OWN PERFORMANCE:

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 thecommittees was evaluated by the board after seeking inputs from the committee members onthe basis of the criteria such as the composition of committees effectiveness ofcommittee 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 on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role.

In a separate meeting of independent directors performance of non-independentdirectors performance of the board as a whole and performance of the chairman wasevaluated taking into account the views of executive directors and non-executivedirectors. Performance evaluation of independent directors was done by the entire boardexcluding the independent director being evaluated.

• NUMBER OF MEETINGS OF BOARD:

During the FY 2017-18 the Board of Directors met ten times viz. 1st May2017 28th June 2017 17th July 2017 26th July 201714th August 2017 17th August 2017 19th September2017 10th October 2017 3rd January 2018 & 14thMarch 2018.

Name of the Director Number of Board Meetings Attended
Vijay Kumar Batra 10
Rahul Batra 10
Varun Batra 10
Balwant Singh 10
Neeraj Batra 10
Rohit Parti 2
Nipun Arora 2
Manmohan Khanna 2

Last Annual General Meeting of the company was held on 24th July 2017 andfollowing shareholders were present in the meeting:-

Name of the Shareholder Number of Equity Shares held
Vijay Kumar Batra 1004200
Rahul Batra 2500
Varun Batra 2500
Neeraj Batra 500
Balwant Singh 100
Aditi Batra 100
Heena Batra 100

Total 3 Extraordinary General Meeting was held during the FY 2017-18 viz 26thJune 2017 10th August 2017 & 17th August 2017.

• DECLARATION BY INDEPENDENT DIRECTORS:

The Company has received necessary Declaration from each Independent Director/s undersection 149(7) of the Companies Act 2013 that they meets the criteria of Independencelaid down in section 149(6) of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.

• ISSUE OF EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS / SWEAT EQUITY SHARES /EMPLOYEE STOCK OPTION SCHEME:

During the year the Company has not issued any equity shares with differential votingrights or sweat equity shares or shares under employee stock option scheme. Hencedisclosure regarding the same is not given.

• AUDITORS' REPORT:

M/s Kalra Rai & Associates Chartered Accountants Chandigarh Firm RegistrationNumber 008859N have issued their Report for the Financial Year ended 31st March 2018.Thereis no qualification reservation adverse remark or disclaimer by the Statutory Auditorsin their report and hence no explanation or comments of the Board is required in thismatter.

• COMMENTS ON AUDITOR'S REPORT

The notes referred to in the Auditor Report are self-explanatory and they do not callfor any further explanation as required under section 134 of the Companies Act 2013.

• SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company hasappointed

Mr Dinesh Bhandari Company Secretary in Practice to undertake the Secretarial Audit ofthe Company. The Secretarial Audit Report is annexed herewith as "Annexure-1".

• COMPANY REPLY TO THE SECRETARIAL AUDITOR QUALIFICATION

QUALIFICATION COMPANY REPLY
1. Non Registration of creation of charge u/s 7778 of Companies Act 2013 by way of hypothecation of vehicle against vehicle loan of Rs. 43 lakhs taken from HDFC Bank Limited on 13.06.2017 and application for seeking extension of time for registration of creation of charge not filed u/s 87 of Companies Act 2013. The company is in process of filing of Application for seeking extension of time for registration of creation of charge u/s 87 of Companies Act 2013 and will be filed shortly.

• INTERNAL AUDIT CONTROLS AND THEIR ADEQUACY

The Company has a proper and adequate system of internal controls commensurate withthe size scale and complexity of its operations. This ensures that all transactions areauthorized recorded and reported correctly and assets are safeguarded and protectedagainst loss from unauthorized use or disposition. In addition there are operationalcontrols and fraud risk controls covering the entire spectrum of internal financialcontrols.

To maintain its objectivity and independence the Internal Audit function reports tothe Chairman of the audit committee of the Board and to the Chairman and ManagingDirector. The internal Audit department monitors and evaluate the efficiency and adequacyof the internal control system in the Company its compliance with operating systemsaccounting procedures and policies at all locations of the Company. Based on the report ofinternal audit functions process owner undertake corrective actions in their respectiveareas and thereby strengthen the controls. Significant audit observations andrecommendations along with corrective actions thereon are presented to the Audit Committeeof the Board.

• ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIALSTATEMENTS

The Company has internal Auditors and the Audit Committee constituted are in place totake care of the same. During the year the Company continued to implement theirsuggestions and recommendations to improve the control environment. Their scope of workincludes review of processes for safeguarding the assets of the Company review ofoperational efficiencyeffectiveness of systems and processes and assessing the internalcontrol strengths in all areas. Internal Auditors findings are discussed with the processowners and suitable corrective actions taken as per the directions of Audit Committee onan ongoing basis to improve efficiency in operations.

• AUDIT COMMITTEE:

As required under the provisions of section 177 of the Companies Act 2013 and Rulesmade there under the Board of Director at its meeting held on 26th July 2017constituted the Audit Committee. The Audit Committee comprises of the following members:

1. Mr. Rohit Parti Chairperson
2. Mr. Vijay Kumar Batra Member
3. Mr. Manmohan Khanna Member
4. Mr Nipun Arora Member

During the year Audit Committee has met two times details of the same are as follows:

Date of Meeting Strength of Committee No. of Members Present
03.01.2018 4 4
14.03.2018 4 4

The term of references of audit committee are to recommend for appointment of statutoryauditor approve related party transactions examination of financial statements andauditor's report scrutinize inter corporate loans and investments evaluation of internalfinancial control and risk management review and monitor auditors independence andperformance and effectiveness of audit process.

Term of Reference of the Committee

1. Oversight of the Company's financial reporting process and the disclosure of itsfinancial information to ensure that the financial statement is correct sufficient andcredible.

2. Recommending to the Board the appointment re-appointment and if required thereplacement or removal of the statutory auditor and the fixation of audit fees.

3. Approval of payment to statutory auditors for any other services rendered by thestatutory auditors

4. Reviewing with the management the annual financial statements before submission tothe board for approval with particular reference to:

i. Matters required to be included in the Director's Responsibility Statement to beincluded in the Board's report in terms of clause (c) of sub-section 3 of section 134 ofthe Companies Act 2013;

ii. Changes if any in accounting policies and practices and reasons for the same;

iii. Major accounting entries involving estimates based on the exercise of judgment bymanagement;

iv. Significant adjustments made in the financial statements arising out of auditfindings;

v. Compliance with listing and other legal requirements relating to financialstatements;

vi. Disclosure of any related party transactions;

vii. Qualifications in the draft audit report.

5. Reviewing with the management the half yearly financial statements beforesubmission to the board for approval.

6. Reviewing with the management the statement of uses / application of funds raisedthrough an issue (public issue right issue preferential issue etc.) the statement offunds utilized for purposes other than those stated in the offer document/DraftProspectus/ Prospectus /notice and the report submitted by the monitoring agencymonitoring the utilization of proceeds of a public or rights issue and making appropriaterecommendations to the Board to take up steps in this matter.

7. Review and monitor the auditor's independence performance and effectiveness ofaudit process.

8. Approval or any subsequent modification of transactions of the company with relatedparties;

9. Scrutiny of inter-corporate loans and investments;

10. Valuation of undertakings or assets of the company wherever it is necessary;

11. Evaluation of internal financial controls and risk management systems;

12. Reviewing with the management performance of statutory and internal auditorsadequacy of the internal control systems

13. Reviewing the adequacy of internal audit function if any including the structureof the internal audit department staffing and seniority of the official heading thedepartment reporting structure coverage and frequency of internal audit.

14. Discussion with internal auditors any significant findings and follow up there on.

15. Reviewing the findings of any internal investigations by the internal auditors intomatters where there is suspected fraud or irregularity or a failure of internal controlsystems of a material nature and reporting the matter to the board.

16. Discussion with statutory auditors before the audit commences about the nature andscope of audit as well as post-audit discussion to ascertain any area of concern.

17. To look into the reasons for substantial defaults in the payment to the depositorsdebenture holders shareholders (in case of non payment of declared dividends) andcreditors.

18. To oversee and review the functioning of the vigil mechanism which shall providefor adequate safeguards against victimization of employees and directors who avail of thevigil mechanism and also provide for direct access to the Chairperson of the AuditCommittee in appropriate and exceptional cases.

19. Call for comments of the auditors about internal control systems scope of auditincluding the observations of the auditor and review of the financial statements beforesubmission to the Board;

20. Approval of appointment of CFO (i.e. the whole-time Finance Director or any otherperson heading the finance function or discharging that function) after assessing thequalifications experience & background etc. of the candidate.

21. To investigate any other matters referred to by the Board of Directors;

22. Carrying out any other function as is mentioned in the terms of reference of theAudit Committee.

The Audit Committee shall mandatorily review the following information:

a. Management discussion and analysis of financial information and results ofoperations;

b. Statement of significant related party transactions (as defined by the AuditCommittee) submitted by the management;

c. Management letters / letters of internal control weaknesses issued by the statutoryauditors;

d. Internal audit reports relating to internal control weaknesses; and

e. The appointment removal and terms of remuneration of the chief internal auditorshall be subject to review by the Audit Committee.

• NOMINATION & REMUNERATION COMMITTEE:

As required under the provisions of section 178 of the Companies Act 2013 and Rulesmade there under the Board of Director at its meeting held on 26th July 2017constituted the Nomination and Remuneration Committee. The Nomination and RemunerationCommittee consists of the following members:

Mr. Rohit Parti Chairperson
Mr. Vijay Kumar Batra Member
Mr. Manmohan Khanna Member
Mr Nipun Arora Member

During the year one meeting of the nomination and remuneration committee was held.Details of the Meeting are as follows:

Date of Meeting Strength of Committee No. of Members Present
03.01.2018 4 4

(i) Term of Reference of the Committee

• To identify persons who are qualified to become Directors and who may beappointed in senior management in accordance with the criteria laid down recommend to theBoard their appointment and removal and shall carry out evaluation of every Director'sperformance.

• To formulate the criteria for determining qualifications positive attributesand independence of a Director and recommend to the Board a policy relating to theremuneration for the Directors Key Managerial Personnel and other employees.

• The Nomination and Remuneration Committee shall while formulating the policyensure that:

(i) the level and composition of remuneration is reasonable and sufficient to attractretain and motivate Directors of the quality required to run the Company successfully;

(ii) relationship of remuneration to performance is clear and meets appropriateperformance benchmarks; and

(iii) remuneration to Directors Key Managerial Personnel and senior managementinvolves a balance between fixed and incentive pay reflecting short and long-termperformance objectives appropriate to the working of the company and its goals:

• Regularly review the Human Resource function of the Company.

• Discharge such other function(s) or exercise such power(s) as may be delegatedto the Committee by the Board from time to time.

• Make reports to the Board as appropriate.

• Review and reassess the adequacy of this charter periodically and recommend anyproposed changes to the Board for approval from time to time.

• Any other work and policy related and incidental to the objectives of thecommittee as per provisions of the Act and rules made there under.

(ii) Remuneration Policy:

Website link :-

http://www.betadrugslimited.com/pdfs/betapolicies/PolicvonRemunerationNominationa

ndBoarDiversitv.PDF

(a) Remuneration to Executive Directors:

The remuneration paid to executive directors of the Company is recommended by theNomination and Remuneration Committee of the Company and then Board of the Company approvein their duly held meeting. The remuneration of executive directors are decided byconsidering various criteria like qualification experience responsibilities valueaddition to the Company and financial position of the Company. Board is taking permissionof the members if required at any time for paying remuneration to executive directors.

(b) Remuneration to Non-Executive Directors:

Company is not paying any remuneration to non-executive and independent directors ofthe Company except sitting fees of Rs 5000/- per meeting.

• STAKEHOLDERS RELATIONSHIP COMMITTEE:

As required under the provisions of section 178 of the Companies Act 2013 and Rulesmade there under the Board of Director at its meeting held on 26th July 2017constituted the Stakeholders Relationship Committee. The Stakeholders RelationshipCommittee consists of the following members:

1. Mr. Rohit Parti Chairperson
2. Mr. Vijay Kumar Batra Member
3. Mr. Manmohan Khanna Member
4. Mr Nipun Arora Member

The Company has not received any complaints during the year. There was no valid requestfor transfer of shares pending as on 31st March 2018. During the year no meeting of theStakeholders Relationship Committee was held.

Mrs.Rajni Brar Company Secretary is the Compliance Officer for the above purpose.

Term of Reference of the Committee

i. Efficient transfer of shares; including review of cases for refusal of transfer /transmission of shares and debentures;

ii. Redressal of security holder's/investor's complaints Efficient transfer of shares;including review of cases for refusal of transfer / transmission of shares and debentures;

iii. Reviewing on a periodic basis the approval/refusal of transfer or transmission ofshares debentures or any other securities;

iv. Issue of duplicate certificates and new certificates onsplit/consolidation/renewal;

v. Reference to statutory and regulatory authorities regarding investor grievances; and

vi. To otherwise ensure proper and timely attendance and redressal of investor queriesand grievances;

vii. To take note of Dematerialisation and Rematerialisation requests received from theshareholders of the company.

viii. Any other power specifically assigned by the Board of Directors of the Company

• POLICY ON PRESERVATION OF THE DOCUMENTS

The Company has formulated a Policy pursuant to Regulation 9 of the Securities ExchangeBoard of India (Listing obligations and Disclosure Requirements) Regulations 2015("Regulations") on Preservation of the Documents to ensure safe keeping of therecords and safeguard the Documents from getting manhandled while at the same timeavoiding superfluous inventory of Documents.

• POLICY ON CRITERIA FOR DETERMINING MATERIALITY OF EVENTS

The Policy is framed in accordance with the requirements of the Regulation 30 ofSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 (Regulations). The objective of the Policy is to determine materialityof events or information of the Company and to ensure that such information is adequatelydisseminated in pursuance with the Regulations and to provide an overall governanceframework for such determination of materiality.

• RISK MANAGEMENT POLICY/PLAN:

It may please be noted that as our Company is not falling in the applicability criteriaprescribed as mentioned in the SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015.

Hence the company has not developed and implemented any risk management policy/planbut the Company has adequate internal control systems and procedures to combat the risk.

• VIGIL MECHANISM:

It may please be noted that as our Company is not falling in the applicability criteriaprescribed as mentioned in the SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015.

Hence there is no vigil mechanism in the company.

• CODE OF BUSINESS CONDUCT AND ETHICS:

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations 1992read with SEBI (Prohibition of Insider Trading) Regulations 2015 as amended from time totime the code of Internal Procedures and code for prevention of insider trading("Code of Conduct") as approved by the Board from time to time are in force bythe Company. The objective of this Code of Conduct is to protect the interest ofshareholders at large to prevent misuse of any price sensitive information and to preventany insider trading activity by dealing in shares of the Company by its Directorsdesignated employees and other employees.

The Company also adopts the concept of Trading Window Closure to prevent itsDirectors Officers designated employees and other employees from trading in thesecurities of Beta Drugs Limited at the time when there is unpublished price sensitiveinformation. The COC is available on the website of the Company www.betadrugslimited.com .

• DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION.PROHIBITION AND REDRESSAL) ACT. 2013:

The company has a policy and it provides for protection against sexual harassment ofwoman at work place and for prevention and redressal of such complaints. The Company haszero tolerance on Sexual Harassment at workplace. During the year under review nocomplaints were received against the sexual harassment at workplace.

• 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 Company's shareholders may refer the Company's website for the detailed Nomination& Remuneration Policy of the Company on the appointment and remuneration of Directorsincluding criteria for determining qualifications positive attributes independence of aDirector; and other matters provided under sub-section (3) of section 178.

The Company's remuneration policy is directed towards rewarding performance based onreview of achievements periodically.

The remuneration policy is in consonance with the existing industry practice.

• ANALYSIS OF REMUNERATION:

The details of remuneration paid to Directors and Key Managerial Personnel is given inextract of Annual Return attached with this report.

Disclosure/details pursuant to provisions of Section 197(12) of the Companies Act 2013read with Companies (appointment and Remuneration of managerial personnel) Rules 2014 aregiven as follows:

1) The percentage increase in Remuneration of each Director Chief Financial Officerand Company Secretary in the financial year 2017-18 and ratio of remuneration of each keymanagerial personnel (KMP) against the performance are as under:-

Name of Director/KMP and Designation Remuneration of Director/KMP for the Financial Year 2018-18 (In Rs.) % age Increase in Remuneration for the Financial Year 2017-18 Ratio of Remuneration of each director to the Median Remuneration of Employees
Mr.Vijay Kumar Batra Chairman cum Managing Director NIL NIL NIL
Mrs. Neeraj Batra Whole Time Director 2400000 Nil 13.46
Mr. Varun Batra Whole Time Director 2400000 Nil 13.46
Mr Balwant Singh Whole Time Director 1452000 43.20% 8.14
Mr. Rahul Batra Whole Time Director NIL NIL NIL
Mr Manmohan Khanna Independent Director Only Sitting Fee of Rs 10000/- NIL NIL
Mr. Rohit Parti Independent Director Only Sitting Fee of Rs 10000/- NIL NIL
Mr. Nipun Arora Independent Director Only Sitting Fee of Rs 10000/- NIL NIL
Mrs Rajni Brar Company Secretary 277701 Appointed w.e.f. 17th July 2018 1.56
Mr Jayant Kumar CFO 667164 Appointed as CFO w.e.f. 17th July 2018 3.74

2) The Median Remuneration of Employees of the Company during the financial year2017-18 was Rs. 178356/-

3) There was an increase of 8.22% in median remuneration of employees during thefinancial year.

4) The number of permanent employees on the rolls of the Company is 165 for the yearended March 31 2018.

5) There was an increase of 45.44% in salaries of employees other than the managerialpersonnel during the financial year 2017-18 .

6) It is affirmed that remuneration paid during the year ended March 31st 2018 is asper the Remuneration Policy of the Company.

• PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES:

• There was no employee drawing remuneration in excess of limits prescribed undersection 197(12) of the Companies Act 2013 read with Rule 5(2) and 5(3) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014. The Disclosurepertaining to remuneration as required under section 197(12) of the Companies Act 2013read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Amendment Rules 2016 are as per Annexure - 2.

• REGULATORY ORDERS:

During the year there were no significant and material orders passed by the regulatorsor courts or tribunals impacting the going concern status and Company's operations infuture.

• CSR COMMITTEE:

During the year under review CSR Committee is not applicable to the Company no furtherdetails/disclosure required to be given in this regard. In the Financial Year 2018-19company has constitute a CSR Committee comprising following members:

Mr Vijay Kumar Batra Chairman
Mr Rahul Batra Member
Mr Rohit Parti Member

• DETAILS ON CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION. FOREIGN EXCHANGEEARNINGS AND OUTGO:

The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of The Companies (Accounts) Rules 2014.

(A) CONSERVATION OF ENERGY

(i) the steps taken or impact on conservation of energy The Company accords high priority to conservation of energy. However there are no specific steps taken in this regard.
(ii) the steps taken by the company for utilizing alternate sources of energy The Company is not utilizing alternate sources of energy.
(iii) the capital investment on energy conservation equipments NIL

(B) TECHNOLOGY ABSORPTION

(i) the efforts made towards technology absorption NIL
(ii) the benefits derived like product improvement cost reduction product development or import substitution NIL
(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year) (a) the details of technology imported; The Company has not imported any technology during the year. Hence there are no details to be furnished under this clause.
(b)the year of import;
(c)whether the technology been fully absorbed;
(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof; and
(iv) the expenditure incurred on Research and Development There are no expenditure incurred on Research and Development by the Company.

(C) Foreign exchange earnings and Outgo:

The Foreign Exchange earned in terms of actual inflows during the year and the ForeignExchange outgo during the year in terms of actual outflows are given below :

Particulars Amt. as on 31.3.2018 Amt. as on 31.3.2017
Earnings in Foreign Exchange 14415249.91 33690510.52
Foreign Exchange Outgo 10846771 NIL

• INTERNAL FINANCIAL CONTROL:

The Company has a well placed proper and adequate internal financial control systemwhich ensures that all the assets are safeguarded and protected and that the transactionsare authorized recorded and reported correctly.

The internal audit covers a wide variety of operational matters and ensures compliancewith specific standard with regards to availability and suitability of policies andprocedures. During the year no reportable material weakness in the design or operationwere observed.

The Directors has laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and have been operatingeffectively.

• DEPOSITS:

The Company has not invited/ accepted any deposits from the public during the yearended March 31 2018. There were no unclaimed or unpaid deposits as on March 31 2018.However the detail of unsecured loan from Directors of the company is as follows:-

Name Amount As on31.3.2018 Amount As on 31.3.2017
Mr Varun Batra Whole Time Director 0 100000
Mr Balwant Singh Whole Time Director 0 100000
Mr Vijay Kumar Batra Managing Director 0 22965840
Total 0 23165840

• CORPORATE GOVERNANCE:

It may please be noted that as our Company is not falling in the applicability criteriaprescribed as mentioned in the SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015.

Hence the Report on Corporate Governance is not forming part of the Directors' Report.

• TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).

• EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT- 9 is annexedherewith as "Annexure -3"

• PARTICULARS OF LOANS. INVESTMENTS OR GUARANTEES UNDER SECTION 186 OF THECOMPANIES ACT. 2013:

There are no Loans Investments or Guarantees /Security given by the Company during theyear under section 186 of the Companies Act 2013; hence no particulars are required tobe given.

• RELATED PARTY TRANSACTIONS:

The particulars of every contract or arrangements entered into by the Company withrelated parties referred to in sub-section (1) of section 188 of the Companies Act 2013including certain arms length transactions under third proviso Form No. AOC -2 givenbelow:

Related Party Transactions:

Particulars of contracts or arrangements with related parties referred to insub-section (1) of section 188 in the form AOC-2:

All related party transactions that were entered into during the financial year were onan arm's length basis and were in the ordinary course of business.

Information Pursuant to clause (h) of sub-section (3) of section 134 of the Act andRule 8(2) of the Companies (Accounts) Rules 2014:

1. Details of contracts or arrangements or transactions not at Arm's length basis.

Particulars Details
Name (s) of the related party & nature of relationship NIL
b) Nature of contracts/arrangements/transaction -
c) Duration of the contracts / arrangements /transaction
d) Salient terms of the contracts or arrangements or transaction including the value if any
e) Justification for entering into such contracts or arrangements or transactions'
f) Date of approval by the Board "
g) Amount paid as advances if any "
h) Date on which the special resolution was passed in General meeting as required under first proviso to section 188

2. Details of material contracts or arrangements or transactions at Arm's length basis.

Particulars Details
a) Name (s) of the related party & nature of relationship Adley Lab Limited
b) Nature of contracts/Arrangements /transaction Purchase of Goods
c) Duration of the contracts/Arrangements /transaction
d) Salient terms of the contracts or arrangements or transaction including the value if any Total amount involved during the year is Rs 35985763/-
e) Date of approval by the Board 1st May 2017
f) Amount paid as advances if any -
SL. No.2 Particulars Details
a) Name (s) of the related party & nature of relationship Adley Formulations
b) Nature of contracts/ arrangements /transaction i) Sale of Goods-Rs 340652 ii) Purchase of Goods-Rs 1231200 iii) Repayment of Loan-Rs 854636
c) Duration of the contracts/Arrangements /transaction
d) Salient terms of the contracts or arrangements or transaction including the value if any Total amount involved during the year is Rs 2426488/-
e) Date of approval by the Board 1st May 2017
f) Amount paid as advances if any -
Particulars Details
a) Name (s) of the related party & nature of relationship BT Associates Pvt Ltd.
b) Nature of contracts /arrangements /transaction Payment of Building Rent
c) Duration of the contracts /arrangements /transaction
d) Salient terms of the contracts or arrangements or transaction including the value if any Total amount involved during the year is Rs 1823918/-
e) Date of approval by the Board 1st May 2017
f) Amount paid as advances if any -
SL.No.4 Particulars Details
g) Name (s) of the related party & nature of relationship Kedge Pharmacia (India) Pvt Ltd.
h) Nature of contracts /arrangements /transaction Sale of Goods
i) Duration of the contracts /arrangements /transaction
j) Salient terms of the contracts or arrangements or transaction including the value if any Total amount involved during the year is Rs 496371/-
k) Date of approval by the Board 1st May 2017
1) Amount paid as advances if any -
SL.No.5 Particulars Details
a) Name (s) of the related party & nature of relationship Heena Batra
b) Nature of contracts /arrangements /transaction Salary to Director wife
c) Duration of the contracts /arrangements /transaction
d) Salient terms of the contracts or arrangements or transaction including the value if any Payment of salary @ Rs 40000/- p.m. total amounting Rs 200000/- i.e. from 1st April 2017 to 31st August 2017
e) Date of approval by the Board 1st May 2017
f) Amount paid as advances if any -
SL.No.6 Particulars Details
m) Name (s) of the related party & nature of relationship Aditi Batra
n) Nature of contracts/arrangements / transaction Salary to Director wife
) Duration of the contracts /arrangements /transaction
P) Salient terms of the contracts or arrangements or transaction including the value if any Payment of salary @ Rs 40000/- p.m. total amounting Rs 200000/- i.e. from 1st April 2017 to 31st August 2017.
q) Date of approval by the Board 1st May 2017
r) Amount paid as advances if any -

• MANAGEMENT DISCUSSION AND ANALYSIS:

As per Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements)Regulation 2015 the Management Discussion and Analysis Report is given in Annexure - 4.

• APPRECIATION:

Your Directors wish to place on record their sincere appreciation for significantcontribution made by the employees at all the levels through their dedication hard workand commitment thereby enabling the Company to boost its performance during the yearunder report.

Your Directors also take this opportunity to place on record the valuable co-operationand continuous support extended by its valued business associates Practicing CompanySecretary Auditors Supplier Customers Banks / Financial Institutions Governmentauthorities and the shareholders for their continuously reposed confidence in the Companyand look forward to having the same support in all its future endeavors.

Dated: 17.08.2018 By Order of the Board of Directors
Place: Baddi
Registered Office: sd/-
Village Nandpur Lodhimajra Road Vijay Kumar Batra
Baddi Distt Solan H.P. Chairman & Managing Director
(DIN:01083215)