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Caplin Point Laboratories Ltd.

BSE: 524742 Sector: Health care
NSE: CAPLIPOINT ISIN Code: INE475E01026
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OPEN 695.00
CLOSE 693.20
VOLUME 5116
52-Week high 1034.00
52-Week low 626.30
P/E 28.68
Mkt Cap.(Rs cr) 5,387
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Caplin Point Laboratories Ltd. (CAPLIPOINT) - Director Report

Company director report

To the Members

The Directors present their 30th Annual Report on the business andoperations of the Company and the accounts for the Financial Year ended March 31 2021.

1. FInanCIaL HIgHLIgHts

Rs. In Lakhs

Financial results

standalone

Consolidated

particulars 2020-21 2019-20 2020-21 2019-20
Revenue from Operations 48267.96 52782.53 106129.04 86320.17
Other Income 1861.80 6597.13 2354.22 4133.37
total Income 50129.76 59379.66 108483.26 90453.54
Profit Before Interest Depreciation and Tax 23254.29 27296.37 35217.93 30140.14
Less: Finance cost 16.67 18.50 158.96 31.97
Less : Depreciation and amortisation expenses 2244.08 1965.38 3697.12 3161.92
Profit Before Tax 20993.53 25312.49 31361.85 26946.25
Less: Tax Expenses 5371.55 5548.64 6218.82 5437.88
Profit After Tax 15621.98 19763.85 25143.03 21508.37
Less: Non-controlling Interest - - 916.41 7.57
Net profit attributable to the shareholders of the Company 15621.98 19763.85 24226.62 21500.80

2. operatIons reVIeW /perFormanCe

The Company has on standalone basis registered total revenue of Rs. 48267.96 Lakhs(Total Income Rs. 50129.76 Lakhs) from operations during the year under review as againstRs. 52782.53 Lakhs (Total Income Rs. 59379.66 Lakhs) in the previous Financial Year. TheProfit After Tax was Rs. 15621.98 Lakhs during the year under review as against Rs.19763.85 Lakhs in the previous Financial Year.

The Company has on consolidated basis registered total revenue of Rs. 106129.04Lakhs (Total Income Rs. 108483.26 Lakhs) from operations during the year under review asagainst Rs. 86320.17 Lakhs (Total Income Rs. 90453.54 Lakhs) in the previous FinancialYear.

3. management DIsCUssIon anD anaLYsIs

In compliance with Regulation 34 of the SEBI (Listing Obligations and

Disclosure Requirements) Regulations 2015 (Listing Regulations) separate Section onManagement Discussion and Analysis as approved by the Board which includes details onthe state of affairs of the Company along with operational performance / review formspart of this Annual Report.

4. DIVIDenD

The Board of Directors at their Meeting held on May 06 2021 declared an InterimDividend of Rs. 1.50 (75%) per equity share of Rs.2/- each for the Financial Year 2020-21and was paid to those shareholders whose name appeared in the Register of Members andbeneficial Further the Board of Directors at their meeting held on August 5 2021 haverecommended a Final Dividend of Rs.1.50 (75%) per equity share of Rs. 2 /- each for theFinancial Year 2020-21 subject to the approval of the shareholders at the ensuing AnnualGeneral Meeting (AGM). If approved the total dividend for the Financial Year 2020-21would amount to Rs.3/- per equity share (150%) of Rs 2/- each.

In compliance with Regulation 43A of the Listing Regulations the Dividend DistributionPolicy is uploaded on the Company’s website athttp://www.caplinpoint.net/investor.aspx

5. transFer to reserVes

The Board of Directors have decided to retain the entire amount of profits for theFinancial Year 2020-21 in profit and loss account.

6. SUBSIDIARIES

Details of subsidiaries have been covered under Extract of Annual Return which canbe accessed on the following link. http://www.caplinpoint.net/investor.aspx

During the Financial Year there were no material development in the status ofsubsidiary companies.

Caplin Steriles Limited and Caplin Point Far East Limited Hongkong are the materialsubsidiaries of the Company.

Pursuant to Section 129(3) of the Act 2013 a statement containing the salientfeatures of the financial statements of subsidiaries in the prescribed Form AOC-1 isannexed as Annexure - I to this Report.

7. ConsoLIDateD FInanCIaL statements

Pursuant to Section 129(3) of the Act 2013 and Listing Regulations the ConsolidatedFinancial Statements prepared in accordance with the Indian Accounting Standardsprescribed by the Institute of Chartered Accountants of India are attached to thisreport.

Pursuant to the provisions of Section 136 of the Act 2013 the financial statements ofthe Company consolidated financial statements along with relevant documents and separateaudited financial statements in respect of the subsidiaries are available on the websiteof the Company.

8. DeposIts

The Company did not accept any deposits from the public within the meaning of Chapter Vof the Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014 for theyear ended March 31 2021.

9. BUSINESS RESPONSIBILITY REPORT

Pursuant to Regulation 34 of the Listing Regulations a Business Responsibility Reportis attached as Annexure - VII to this Report.

10. sHare CapItaL

The paid up share capital as on March 31 2021 stood at Rs.151285500/- consistingof 75642750 equity shares of Rs.2/- each.

11. partICULars oF Loans gUarantees or InVestments UnDer seCtIon 186 oF tHe aCt 2013

Particulars of loans guarantees and investments as on March 31 2021 are given in theNote No. 3 3A 4 6 & 10 to the standalone financial statements.

12. NUMBER OF MEETINGS OF THE BOARD

The number of Board meetings held during the Financial Year 2020-21 are providedas part of Corporate Governance Report prepared in terms of the Listing Regulations.

13. DIreCtors anD KeY managerIaL personneL

a. Directors

As on March 31 2021 the Board consisted of a Non- Executive Chairman an ExecutiveDirector six Independent Directors and a Non-Executive - Non- Independent Director.

During the year under review Dr. Sridhar Ganesan (DIN: 06819026) was re-appointed asthe Managing Director of the Company for a further period of two years effective August25 2020 by the shareholders at their AGM held on September 28 2020.

Dr. R Ravichandran (DIN: 01920603) Independent Director retired on May 11 2021 (closeof business hours) upon completion of his tenure. The Board wishes to place on record thevaluable guidance and directions provided during his tenure as a Director of the Company.

b. Company Secretary and Compliance Officer

During the year Mr. Vinod Kumar S Company Secretary Key Managerial Personnel (KMP)and Compliance Officer of the Company resigned from the services of the Company effectiveFebruary 5 2021.

Consequent to Mr. Vinod Kumar’s resignation the Board had appointed Mr. Dinesh RG as the Company Secretary KMP and Compliance Officer of the Company effective May 62021.

c. retirement by rotation

Pursuant to Section 152 (6) of the Act 2013 Mr. C C Paarthipan (DIN: 01218784)Non-Executive Non-Independent Director retires by rotation and being eligible offershimself for re-appointment.

d. Kmp

Pursuant to Sections 2(51) and 203 of the Act 2013 Dr. Sridhar GanesanManaging Director Mr. D Muralidharan Chief Financial Officer and Mr. Dinesh R G CompanySecretary are the KMP of the Company.

14. DECLARATION BY INDEPENDENT DIRECTORS

Pursuant to Section 149(7) of the Act 2013 all Independent Directors have declaredthat they meet the criteria of independence as provided under Section 149(6) of the Act2013 and Regulation 25 of the Listing Regulations and the Board confirmsthat they areindependent of the management.

15. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act 2013 the Directors confirm that:

a. In the preparation of the annual accounts the applicable accounting standards (INDAS) had been followed along with 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 March 31 2021 and of the profit ofthe Company for that period;

c. The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d. The Directors had prepared the annual accounts on a going concern basis;

e. The Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

f. The Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

16. materIaL CHanges anD CommItments IF anY aFFeCtIng tHe FInanCIaL posItIon oF tHeCompanY

There were no material changes and commitments affecting the financial position of theCompany which have occurred between the end of the Financial Year of the Company to whichthe financial statements relate and the date of the report.

17. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN eXCHange earnIngs anD oUtgo

Pursuant to Section 134 (3)(m) of the Act 2013 read with Rule 8 (3) of the Companies(Accounts) Rules 2014 particulars of conservation of energy technology absorptionforeign exchange earnings and outgo as are given asAnnexure - II to thisDirectors’ Report.

18. ANNUAL EVALUATION OF THE BOARD ITS COMMITTEES AND

InDIVIDUaL DIreCtors

Pursuant to the provisions of the Act 2013 and Regulation 4 of the

Listing Regulations the Board of Directors has carried out annual performanceevaluation of its own performance the Directors Individually as well as the evaluation ofthe working of its Committees.

The manner in which the evaluation was carried out has been explained in the CorporateGovernance Report which forms part of this report.

19. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Pursuant to the provisions of Section 135 of the Act 2013 read with CSR Rules theCompany has constituted CSR Committee and based upon the recommendations of the CSRCommittee the Board of Directors have approved CSR Policy.

Disclosure under Companies Corporate Social Responsibility Policy 2014 is annexed as anAnnexure - III to this report.

20. BOARD COMMITTEES

Pursuant to the Act 2013 and the Listing Regulations the Company has formed all thestatutory Committees namely the Audit Committee the Nomination and RemunerationCommittee the Corporate Social Responsibility Committee the Stakeholders’Relationship Committee and the Risk Management Committee.

Detailed information about these Committees and relevant information for the year underreview are given in the Corporate Governance Report.

There have been no instances where the Board did not accept the recommendations of itsCommittees including the Audit Committee.

21. InternaL FInanCIaL ControLs

Details in respect of adequacy of internal financialcontrols concerning the FinancialStatements are stated in the Management Discussion and Analysis section which forms partof this Annual Report.

22. VIgIL meCHanIsm

The Company has established a vigil mechanism through a Whistle Blower Policy whereDirectors and employees can voice their genuine concerns or grievances about any unethicalor unacceptable business practice. A whistle-blowing mechanism not only helps the Companyin detection of fraud but is also used as a corporate governance tool leading toprevention and deterrence of misconduct. It provides direct access to the employees of theCompany to approach the Compliance Officer or the Chairman of the Audit Committee wherenecessary. The Company ensures that genuine Whistle Blowers are accorded completeprotection from any kind of unfair treatment or victimization.

The Vigil mechanism policy is disclosed on the website of the Company athttp://www.caplinpoint.net/investor.aspx

23. aUDItors

a. statutory auditors

The Company at its 26th AGM held on September 21 2017 had re-appointed M/s.CNGSN & Associates LLP Chartered Accountants Chennai as Statutory Auditors of theCompany to hold officefor the second term of five consecutive years from the conclusionof 26th AGM till the conclusion of 31st AGM.

The Statutory Auditors will continue to hold office for the 5th year in thesecond term of five consecutive years from the conclusion of this AGM.

The Company has obtained necessary certificate under Section 141 of the Act 2013conveying their eligibility for being the Statutory Auditors of the Company for theFinancial Year 2021-22.

The Auditors’ Report for the Financial Year 2020-21 does not contain anyqualification reservation or adverse remark and the same is attached with the annualfinancial statements.

b. secretarial auditors

Pursuant to Section 204 of the Act 2013 and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company is required to appoint aSecretarial Auditor for auditing secretarial and related records of the Company.

The Secretarial Audit Report for the Financial Year 2020-21 given by M/s. GRamachandran & Associates Company Secretaries Chennai is attached as Annexure -IV to this Report.

The Secretarial Audit Report does not contain any qualification reservation or otherremarks.

Pursuant to Regulation 24A of Listing Regulations a listed entity shall annex with itsAnnual Report the Secretarial Audit Report of its material unlisted subsidiaryincorporated in India. Caplin Steriles Limited being a material unlisted subsidiary of theCompany the Secretarial Audit Report is annexed as Annexure - IV-A to thisDirectors Report.

c. Internal auditors

Pursuant to Section 138 of the Act 2013 the Board at its meeting held on May 6 2021had re-appointed M/s. TBL & Associates as Internal Auditors for carrying out internalaudit of the Company for the Financial Year 2021-22. The internal audit for the FinancialYear 2020-21 was completed as per the scope defined by the Audit Committee from time totime.

24. REPORTING OF FRAUDS BY AUDITORS

Pursuant to provisions of the Section 143(12) of the Act 2013 neither the StatutoryAuditors nor the Secretarial Auditors has reported any incident of fraud to the AuditCommittee during the year under review.

25. Corporate goVernanCe

Pursuant to Regulation 34 of Listing Regulations a Report on Corporate Governance isgiven separately which forms a part of this Annual Report.

26. annUaL retUrn

Pursuant to Section 92(3) and 134(3)(a) of the Act 2013 read with Rule 12 of ChapterVII Rules of the Companies (Management and Administration) Amendment Rules 2020 AnnualReturn in Form MGT-7 for FY 2020-21 is uploaded on the website of the Company and can beaccessed at http://www.caplinpoint.net/investor.aspx

27. rIsK management

The Company has constituted a Risk Management Committee in compliance with therequirements of Regulation 21 of the Listing Regulations. The details of this Committeeand its terms of reference are set out in Corporate Governance Report which forms part ofthis Annual Report.

The Company has in place a Risk Management framework to identify evaluate and monitorbusiness risks and challenges across the Company that seek to minimise the adverse impacton business objectives and capitalise on opportunities. The Company’s success as anorganisation largely depends on its ability to identify such opportunities and leveragethem while mitigating the risks that arise while conducting its business.

28. empLoYee stoCK optIon pLan

The Company has two stock options in force (i.e) Caplin Point Employee Stock OptionPlan -2015 and Caplin Point Employee Stock Option Plan – 2017. The Company hasgranted 281000 options under Caplin Point Employee Stock Option Plan -2015 out of which92750 options has been exercised and allotted as on March 31 2021. The Company hasgranted 490000 options under Caplin Point Employee Stock Option Plan-2017 as on March31 2021. The details required under Rule 12 (9) of Companies (Share Capital andDebentures) Rules 2014 and as required to be provided under the SEBI Guidelines as onMarch 31 2021 forms part of this Report and is available athttp://www.caplinpoint.net/investor.aspx

The Company believes that equity based compensation schemes are an effective tool toreward the employees in the growth of the Company to attract new talents to retain thekey resources in the organisation and for the benefit of the present and future employeesof the Company. In view of the above the Board of Directors approved the formulation andimplementation of Caplin Point Employee Stock Option Plan - 2021 (ESOP 2021 Plan).Resolution seeking approval of the shareholders for ESOP 2021 Plan has been incorporatedin the Notice of the AGM.

29. partICULars oF empLoYees reLateD DIsCLosUres

The statements required under Section 197 of the Act 2013 read with Rule 5(2) and5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014as amended form part of this Report and will be made available to any shareholder onrequest as prescribed therein.

The prescribed particulars of employees required under 5(1) of the said Rules are isannexed as anAnnexure - V to this Report.

Pursuant to Section 197(12) of the Act 2013 read with the Rule 5 of the Companies(Appointment of Managerial Personnel) Rules 2014 no employee who drew a remuneration ofmore than Rs.1.02 crores per annum or Rs. 8.50 lakhs per month was employed throughoutthe Financial Year or part of the Financial Year.

30. partICULars oF ContraCts or arrangements WItH reLateD partIes

All Related Party Transactions which were entered into during the year under reviewwere on arm’s length basis and in the ordinary related party course of business.There were no materially significant transactions made by the Company with the PromotersDirectors and KMP which may have a potential conflict with the interests of the Company atlarge.

All Related Party Transactions are placed before the Audit Committee for review andapproval. Prior omnibus approval of the Audit Committee is obtained on an annual basis forthe transactions which are planned/repetitive in nature. Related Party Transactionsentered pursuant to the omnibus approval so granted are placed before the Audit Committeefor its review on a quarterly basis specifying the nature value and terms and conditionsof the transactions. All the Related Party Transactions under Ind AS-24 have beendisclosed at Note No. 44 to the standalone financial statements forming part of thisAnnual Report.

Particulars of transactions with related parties in prescribed form AOC-2 is enclosedas Annexure - VI to this Report.

Approval of the shareholders is being sought under Regulation 23 of the ListingRegulations for the material Related Party Transactions and the proposal along withdetailed explanatory statement is given as part of the Notice to Shareholders for theensuing AGM.

The related party transaction policy and material related party transactions have beenuploaded on the website of the Company at http://www.caplinpoint.net/investor.aspx

31. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS

by the Regulators Thereare no significant or Courts or Tribunals which would impact thegoing concern status of the Company.

32. DIsCLosUre UnDer seXUaL Harassment oF Women at tHe WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013

Pursuant to the provisions of Sexual Harassment of Women at the Workplace (PreventionProhibition and Redressal) Act 2013 the Company has put in place a Policy on Preventionof Sexual Harassment at Workplace and Internal Complaints Committees (ICC) has been set upto redress complaints. There were no complaints relating to sexual harassment pending atthe beginning of Financial Year received during the year and pending as on the end of theFinancial Year 2020-21.

33. InVestor eDUCatIon anD proteCtIon FUnD

Pursuant to Sections 124 and 125 of the Act 2013 the amount of dividends remainingunpaid or unclaimed for a period of seven years from the date of transfer to the unpaidaccount is required to be transferred to the Investor Education and Protection Fund(IEPF) of the Central Government.

During the year under review the Company has credited 203625 unclaimed equity sharesof Rs.2/- each to IEPF pertaining to those shareholders who have not encashed/claimedtheir dividends for a period of seven consecutive years. The voting rights on the sharesoutstanding in the IEPF Authority as on March 31 2021 shall remain frozen till therightful owner of such shares claims the shares.

Pursuant to Sections 124 and 125 of the Act 2013 the unpaid or unclaimed dividend forthe Financial Year 2013-14 has to be transferred to IEPF. Members who have not yeten-cashed or claimed the dividends that are yet to be transferred to the IEPF arerequested to contact the Company’s Registrar and Share Transfer Agent at theearliest.

Members are requested to take note of the same and claim their unclaimed dividendsimmediately to avoid transfer of the underlying shares to the IEPF Account. The sharestransferred to the IEPF Account can be claimed back by the concerned Members from IEPFAuthority after complying with the procedure prescribed under the Rules.

34. sHIFtIng oF regIstereD oFFICe

The Company shifted its registered office of the Company from

"Narbavi" No.3 Lakshmanan Street T Nagar Chennai-600 017 to "AshvichTowers" 3rd Floor No.3 Developed Plots Industrial Estates PerungudiChennai -600 096 effective July 092020.

35. otHer DIsCLosUres

a. There has been no change in the nature of business of the Company during the yearunder review.

b. Pursuant to Section 197 (14) of the Act 2013 the Managing Director of the Companydid not receive any remuneration or commission from any of its subsidiaries.

c. The Company maintains cost records as per Companies (Cost Records and Audit) Rules2014.

d. The Board confirms the compliance of the provisions of the Secretarial Standardsnotified by the Institute of Company Secretaries of India New Delhi.

36. aCKnoWLeDgement

The Board of Directors wishes to place on record its sincere appreciation to thecustomers suppliers business partners and subsidiaries and shareholders for theirsupport. The Directors would like to thank the Bankers and financial Institutions as well.The Directors would take this opportunity to appreciate and sincerely acknowledge thededication and hard work of the employees for the growth of the Company.

FOR AND ON BEHALF OF THE BOARD
Place: Chennai C C paartHIpan
Date: August 5 2021 Chairman

.