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Coral Laboratories Ltd.

BSE: 524506 Sector: Health care
NSE: N.A. ISIN Code: INE683E01017
BSE 00:00 | 23 Apr 357.80 9.30
(2.67%)
OPEN

348.50

HIGH

358.00

LOW

348.00

NSE 05:30 | 01 Jan Coral Laboratories Ltd
OPEN 348.50
PREVIOUS CLOSE 348.50
VOLUME 164
52-Week high 648.00
52-Week low 295.20
P/E 8.88
Mkt Cap.(Rs cr) 128
Buy Price 348.00
Buy Qty 10.00
Sell Price 357.00
Sell Qty 10.00
OPEN 348.50
CLOSE 348.50
VOLUME 164
52-Week high 648.00
52-Week low 295.20
P/E 8.88
Mkt Cap.(Rs cr) 128
Buy Price 348.00
Buy Qty 10.00
Sell Price 357.00
Sell Qty 10.00

Coral Laboratories Ltd. (CORALLABS) - Director Report

Company director report

To

The Members of Coral Laboratories Limited

Dear Member(s)

Your Directors have pleasure in presenting the 36 Annual Report together with theAudited Financial Statements for the year ended 31 March 2018.

FINANCIAL RESULTS:

The performance during the period ended 31 March 2018 has been as under:

(Rs in Lacs)

Particulars 2017-18 2016-17
Income 9694.07 9883.72
Expenditure 7889.12 7395.07
Earnings before Tax 1804.94 2488.65
Provision for Tax 550.00 822.00
Provision for Deferred Tax 10.36 4.74
Less: Income Tax Adjustments of earlier years 32.34
Earnings after Tax 1244.58 1629.58
Other Comprehensive Income (net of tax) (311.77) 2467.40
Total Comprehensive Income 932.81 4096.98
Add: IND-AS Adjustment
Add: Balance Brought forward 10137.99 6240.14
Less: Dividend Paid (including Dividend Distribution tax) (214.99)
Deferred tax liability (199.13)
Balance carried forward to Balance Sheet 10855.82 10137.99

DIVIDEND:

Your Directors are pleased to recommend dividend for the financial year 2017-2018 onthe Equity Shares of the Company of face value of Rs.10.00/- each at the rate of 20% i.e.Rs.2/-per equity share of the Company.

PERFORMANCE:

During the year under review the company posted Revenue of Rs. 9694.07 lacs ascompared to previous year Rs. 9883.73 lacs. However the earnings after tax stood at Rs.1244.59 lacs as compared to Rs.1629.58 lacs during the previous year.

TRANSFER TO RESERVES:

Your Company does not propose to transfer any amount to the general reserve.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

As required under Regulation 34 of SEBI (Listing Obligations and DisclosureRequirements) REGULATIONS 2015 entered with Stock Exchanges the Management Discussionand Analysis Report is enclosed as a part of this report.

DISCLOSURE IN COMPLIANCE WITH THE ACCOUNTING STANDARD ON “RELATED PARTYDISCLOSURES:

As required under Regulation 34 of SEBI (Listing Obligations and DisclosureRequirements) REGULATIONS 2015 with Stock Exchanges the disclosure in compliance withthe accounting standard on “related party disclosures” are enclosed as a part ofthis report.

LISTING WITH STOCK EXCHANGES:

The Equity Shares of the Company continues to be listed at Bombay Stock Exchange. Thescrip code number of the Equity shares of the Company on BSE is 524506.The Companyconfirms that it has paid up to date listing fees to Bombay Stock Exchanges.

DEMATERIALIZATION:

The Equity shares of the Company can be held in dematerialized form. The Company hassigned the tripartite agreement with National Securities Depository Limited and CentralDepository Services (India) Limited and existing Registrar & Transfer Agent fordematerialization of existing holding of the shareholders.

The International Securities Identi cation Number allotted to the Company isINE683E01017. The equity shares of the Company are listed at Bombay Stock Exchange Limited(BSE).

95.61% of the company's paid up Equity Share Capital is in dematerialized form as on 31March 2018 and balance 4.39% is in physical form. The Company's Registrar and sharetransfer agents are Link Intime India Private Limited C-101 247 Park L.B. S MargVikhroli (West) Mumbai - 400 083.

CORPORATE SOCIAL RESPONSIBILITY (CSR):

During the financial Year 2017-2018 the Company has not made any contribution toCorporate Social Responsibility as the Company was identifying the right avenue. TheCompany has as on the date of signing the report initiated the policy of contributingtowards Corporate Social Responsibility.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO:

Information required under section 134(3)(m) of the Companies Act 2013 read with Rule8 of the Companies (Accounts) Rules 2014 is given in the Annexure - A to this report.

STATE OF AFFAIRS:

During the year under review your Company enjoyed cordial relationship with workersand employees at all levels.

INVESTOR EDUCATION AND PROTECTION FUND(IEPF):

As per the provisions of section 124 & 125 read with rules namely “InvestorEducation and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules2016” unpaid dividends if any will be transferred to the Investor Education andProtection Fund of the Central Government pursuant to the provisions of Companies Actafter completion of seven years from the date of its transfer to unpaid dividend account.Further Ministry of Corporate Affairs has recently noti ed new Rules namely “InvestorEducation and Protection Fund Authority (Accounting Audit Transfer and Refund) Rules2016” which have come into force from September 7 2016. The said Rules amongstother matters contain provisions for transfer of all shares in respect of which dividendhas not been paid or claimed for seven consecutive years in the name of IEPF SuspenseAccount. The details of unpaid / unclaimed dividend are available on our website:www.corallab.com.

During the Financial Year 2017-2018 the company has transferred to the InvestorEducation and Protection Fund (IEPF) following amount of unclaimed dividend andcorresponding shares thereto as stated below:

Particulars Amount of dividend transferred (in Rs.) No. of shares transferred
For the year 2008-2009 Rs. 106025 22712 Shares
For the year 2009-2010 Rs.106890 1661 Shares

CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:

Your Company has taken adequate steps to adhere to all the stipulations laid down inRegulation 34(3) read with Schedule V of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015. A report on Corporate Governance is included as a part ofthis Annual Report. Certificate from the M/s. Uma Lodha& Co. Practicing CompanySecretaries confirming the compliance with the conditions of Corporate Governance asstipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015is included as a part of this report.

Your Company has also been enlisted in the new SEBI compliant redressal system (SCORES)enabling the investors to register their complaints if any for speedy redressal.

PUBLIC DEPOSIT:

Your Company has neither accepted nor renewed any deposit within the meaning of Section73 and other applicable provisions if any of the Companies Act 2013 and the necessaryrules made there under during the year ended 31 March 2018.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:

The particulars of loans guarantees and investment have been disclosed in the notes tothe financial statements.

DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

(i) Changes in Directors and Key Managerial Personnel (KMP):

There were changes in Directors or Key Managerial Personnel (KMP) in the financial year2017-2018 as follows:

At the Board Meeting dated 26 May 2017Mr. Navin Doshi (Director) Mr. Kishor Mehta(Whole-Time Director) and Mrs. Meeta Sheth (ChiefFinancial officer) tendered theirresignation.

Mr. Girish Dhameja (DIN: 07798455) was appointed as an Additional Director of theCompany. Accordingly the Board appointed him as Whole-Time Director w.e.f. 26 May 2017subject to approval by the Members of the Company. At the AGM held on 19 September 2017members approved his appointment.

Mr. Chetan Doshi (DIN: 00319134) was appointed as an Additional Director of the Companyw.e.f. 26 May 2017 subject to approval by the Members of the Company. At the AGM held on19 September 2017 members approved his appointment.

Mr. Sanket Mehta (DIN:05309112)was appointed as an Additional Director and IndependentDirector of the Company

w.e.f. 26 May 2017 subject to approval by the Members of the Company. At the AGM heldon 19 September2017 members approved his appointment.

Mrs. Sushma C. Chinchane (DIN:07791735) was appointed as an Additional Director andChief Financial officer of the Company w.e.f. 26 May 2017. At the AGM held on 19September 2017 members approved her appointment.

Ms. Nirali Mehta has been appointed as Company Secretary and Compliance officer of thecompany with effect from 10 August 2017.

DECLARATION OF INDEPENDENCE:

Your Company has received declarations from all the Independent Directors confirmingthat they meet the criteria of independence as prescribed under the provisions ofCompanies Act 2013.

BOARD EVALUATION:

The Board of Directors has carried out an annual evaluation of its own performanceBoard committees and individual Directors pursuant to the provisions of the CompaniesAct2013 and as per Regulation 17(1) of the SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.

The performance of the Board was evaluated by the Board after seeking inputs from allthe Directors on the basis of the criteria such as the Board composition and structureeffectiveness of board processes information and functioning etc.

The performance of the committees was evaluated by the Board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.

The Board and the Nomination and Remuneration Committee (“NRC”) reviewed theperformance of the individual Directors based on the criteria such as the contribution ofthe individual Director to the Board and committee meetings like preparedness on theissues to be discussed meaningful and constructive contribution and inputs in meetingsetc.

In a separate meeting of independent Directors performance of Non-IndependentDirectors performance of the board as a whole and performance of the Chairperson wasevaluated taking into account the views of Executive Directors and Non-ExecutiveDirectors. The same was discussed in the board meeting that followed the meeting of theindependent Directors at which the performance of the Board its committees andindividual Directors was also discussed.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Your company has an effective Internal Control and Risk Mitigation System which areconstantly assessed and strengthened with new/revised standard operating procedures. TheCompany's Internal Control System is commensurate with its size scale and complexities ofits operations. The internal and operational audit is entrusted to M/s. Hardik Shah &Associates a Chartered Accountants rm. The main thrust of internal audit is to test andreview controls appraisal of risks and business processes besides benchmarking controlswith best practices in the industry.

The Audit Committee of the Board of Directors actively reviews the adequacy andeffectiveness of the internal control systems and suggests improvements to strengthen thesame. The Company has a robust Management Information System which is an integral part ofthe control mechanism.

The Audit Committee of the Board of Directors Statutory Auditors and the BusinessHeads are periodically apprised of the internal audit ndings and corrective actions taken.Audit plays a key role in providing assurance to the Board of Directors. Significant auditobservation and corrective actions taken by the management are presented to the AuditCommittee of the Board. To maintain its objectivity and independence the internal Auditfunction reports to the Chairperson of the Audit Committee.

DISCLOSURE RELATING TO REMUNERATION OF DIRECTORS KEY MANAGERIAL PERSONNEL ANDPARTICULARS OF EMPLOYEES:

The information required under Section 197 of the Companies Act 2013 read withCompanies Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect ofDirectors/ employees of your Company is set out in “Annexure [D]” to thisReport.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to Section 134(3)(c) of the Companies Act 2013 Directors of your Companyhereby state and confirm that

(a) In the preparation of the Annual Accounts for the year ended 31st March 2018 theapplicable accounting standards had been followed along with proper explanation relatingto 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 at the end of the financial year and ofthe pro t and loss of the 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 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) The Directors had laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively.

(f) They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

COMMITTEES:

(i) Audit Committee:

The Board has constituted a well-qualified Audit Committee with majority of them areIndependent Directors including Chairperson of the committee. They possess sound knowledgeon accounts audit finance taxation internal controls etc. Mr. Rajesh R. Parikh acts asChairman to the Audit committee.

The Composition of Audit Committee comprises the following:

Sr.No. Name of the Director Designation in Committee Nature of Directorship
1. Mr. Rajesh R. Parikh Chairman Non-Executive (Independent)
2. Mrs. Sheela R. Kamdar Member Non-Executive(Independent)
3. Mrs. Sushma Chinchane (w.e.f. 26 May 2017) Member Non- Executive Non-Independent

(i) Nomination and Remuneration Committee:

The Composition of Nomination and Remuneration Committee comprises the following:

Sr.No. Name of the Director Designation in Committee Nature of Directorship
1. Mr. Rajesh R. Parikh Chairman Non-Executive (Independent)
2. Mrs. Sheela R. Kamdar Member Non-Executive(Independent)
3. Mrs. Sushma Chinchane (w.e.f. 26 May 2017) Member Non- Executive Non-Independent

(ii) Stakeholders Relationship Committee:

The Composition of Stakeholders Relationship Committee comprises the following:

Sr.No. Name of the Director Designation in Committee Nature of Directorship
1. Mr. Rajesh R. Parikh Chairman Non-Executive (Independent)
2. Mrs. Sushma Chinchane (w.e.f. 26 May 2017) Member Non- Executive Non-Independent

(iii) Corporate Social Responsibility Committee:

The Composition of Corporate Social Responsibility Committee comprises the following:

Sr.No. Name of the Director Designation in Committee Nature of Directorship
1. Mr. Rajesh R. Parikh Chairman Non-Executive (Independent)
2. Mrs. Sheela R. Kamdar Member Non-Executive(Independent)
3. Mrs. Sushma Chinchane (w.e.f. 26 May 2017) Member Non- Executive Non-Independent

AUDITORS AND AUDITORS' REPORT:

STATUTORY AUDITORS:

M/s. SPVM & CO. Chartered Accountants (FRN: 136751W)the Statutory Auditors ofthe Company hold the office up to the conclusion of the ensuing Annual General Meeting andbeing eligible offers themselves for re-appointment for the financial year 2018-2019. YourCompany has received written consent and a certificate stating that they satisfy thecriteria provided under Section 141 of the Companies Act 2013 read with the Companies(Audit and Auditors) Rules 2014 and that the appointment if made shall be in accordancewith the applicable provisions of the Companies Act 2013 and rules issued there under.

As required under Regulation 18 read with Part C of Schedule II of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Audit Committee and theBoard of Directors recommend the appointment of M/s. SPVM & CO. CharteredAccountants (FRN: 136751W) as Auditors of your Company for the financial year 2018- 19from the conclusion of this Annual General Meeting (AGM) till the conclusion of theupcoming Annual General Meeting of the Company (subject to ratification of theirappointment at every AGM).

The Auditors' Report for the financial year 2017-18 does not contain anyqualification reservation or adverse remark.

SECRETARIAL AUDITOR /SECRETARIAL AUDIT REPORT:

Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 your Companyhas appointed M/S Uma Lodha & Co. Practicing Company Secretary to conduct theSecretarial Audit of your Company. The Secretarial Audit Report is annexed herewith as“Annexure - [C]” to this Report.

Certain reservations and observations made in the secretarial audit report with regardto following:

Non- engagement of graduate/ technician apprentices as prescribed under The Apprentices(Amendment) Act 1973 1986 & 2014.

Non-compliance regarding publication under Regulation 47 of SEBI (Listing obligationsand Disclosure Requirements) Regulations 2015.

However the Company would ensure in future that all the provisions are complied withto the fullest extent and the website of the Company is updated regularly.

COST AUDIT:

The Board of Director of Your Company has re-appointed M/s. Ketki D. Visariya & Co.Cost Accountants to conduct audit of your Company's cost records for the Financial Year2018-2019 at a remuneration of Rs. 60000/- (Rupees Sixty Thousand only). As requiredunder the provisions of Companies Act 2013 the remuneration of Cost Auditor as approvedby the Board of Directors is subject to ratification by the shareholders at the ensuingAnnual General Meeting.

The Cost Audit Report will be led within the prescribed period of 180 days from theclose of the Financial Year.

WEB ADRESS OF ANNUAL RETURN:

Pursuant to Section 92(3) of the Companies Act 2013 and the Extract of Annual Return(Form No. MGT-9) as on the financial year ended on 31st March2018 has been uploaded onthe website of the Company and weblink of the same is www.corallab.com.

NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS AND AUDIT COMMITTEES:

Your Board of Directors has duly met 4(Four) times during the financial year i.e. on 26May 2017 10 August 2017 06 November 2017 and 25 January 2018 respectively in respect ofwhich proper notices were given and the proceedings were properly recorded and signed inthe Minute Book maintained for the purpose. The intervening gap between the Meetings waswithin the period prescribed under the Companies Act 2013.

The Audit Committee has duly met 4 (Four) times during the financial year i.e. 26 May2017 10 August 2017 06 November 2017 and 25 January 2018 respectively in respect ofwhich proper notices were given and the proceedings were properly recorded and signed inthe Minute Book maintained for the purpose.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

In pursuant to the provisions of section 177(9) & (10) of the Companies Act 2013and Regulation 22 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 a Vigil Mechanism for Directors and employees to report genuineconcerns has been established.

The purpose of the “Whistle Blower Policy” is to allow employees to raiseconcerns about unacceptable improper or unethical practices being followed in theorganization. They will be protected against any adverse action and/or discrimination as aresult of such a reporting provided it is justified and made in good faith. The Chairmanof the Audit Committee has been designated for receiving and recording any complaintsunder this policy.

The Vigil Mechanism Policy has been uploaded on the website of the Company athttp://www.corallab.com/pdf/Whistle-Blower-Policy.pdf

RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financial year were inthe ordinary course of the business. There are no materially significant related partytransactions made by the company with Promoters Key Managerial Personnel or otherdesignated persons which may have potential conflict with interest of the company atlarge.

Transactions with related parties entered by the Company in the normal course ofbusiness are periodically placed before the Audit Committee for its omnibus approval andthe particulars of contracts entered during the year as per Form AOC-2 is enclosed asAnnexure-E. The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 the Rulesthere under and the SEBI (Listing Obligation and Disclosure Requirements) Regulation2015. This Policy was considered and approved by the Board has been uploaded on thewebsite of the Company at http://www.corallab.com/pdf/Related-Party-Transaction-Policy.pdf

CODE OF CONDUCT:

The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees during day to day business operations of thecompany. The Company believes in “Zero Tolerance” against bribery corruptionand unethical dealings / behavior of any form and the Board has laid down the directivesto counter such acts. The code laid down by the Board is known as “code of businessconduct” which forms an Appendix to the Code. The Code has been posted on theCompany's website http://www.corallab.com/pdf/Code-of-Conduct-Coral-Lab.pdf

The Code lays down the standard procedure of business conduct which is expected to befollowed by the Directors and the designated employees in their business dealings and inparticular on matters relating to integrity in the work place in business practices andin dealing with stakeholders. The Code gives guidance through examples on the expectedbehavior from an employee in a given situation and the reporting structure.

All the Board Members and the Senior Management personnel have confirmed compliancewith the Code. All Management Staff were given appropriate training in this regard.

RISK MANAGEMENT:

Pursuant to section 134 (3) (n) of the Companies Act 2013 & Regulation 21 of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 the Company isnot required to constitute a business risk management committee. Hence it is notapplicable to the Company for the year under review.

At present the company has not identified any element of risk which may threaten theexistence of the company.

PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a viewto regulate trading in securities by the Directors and designated employees of theCompany. The Code requires pre-clearance for dealing in the Company's shares and prohibitsthe purchase or sale of Company shares by the Directors and the designated employees whilein possession of unpublished price sensitive information in relation to the Company andduring the period when the Trading Window is closed. The Board is responsible forimplementation of the Code.

All Board Directors and the designated employees have confirmed compliance with theCode.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS:

There are no significant/material orders passed by the Regulators or Courts orTribunals impacting the going concern status of your Company and its operations in future.

General

a) Your Company has not issued Equity Shares with differential rights as to dividendvoting or otherwise; and

b) Your Company does not have any ESOP scheme for its employees/Directors.

DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013:

The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy against sexual harassment in line with the provisions of Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013 and the rules framedthereunder.

During the financial year 2017-18 the company has not received any complaints onsexual harassment and hence no complaints remain pending as of 31 March 2018.

ACKNOWLEDGMENT:

We take this opportunity to express our deep sense of gratitude to Securities andExchange Board of India Bombay Stock Exchange Limited Registrar of Companies NationalSecurities Depository Limited Central Depository Services (India) Limited M/s. LinkIntime India Private Limited Bankers Shareholders and other Government Agencies fortheir continued support.

By Order of the Board

For Coral Laboratories Limited

Sd/- Sd/- Sd/-
Chetan Doshi Girish Dhameja Sushma Chinchane
Chairman & Director Whole-Time Director CFO & Director
(DIN: 00319134) (DIN: 07798455) (DIN: 07791735)
Place : Mumbai
Date : 8 August 2018