You are here » Home » Companies » Company Overview » Denis Chem Lab Ltd

Denis Chem Lab Ltd.

BSE: 537536 Sector: Health care
NSE: N.A. ISIN Code: INE051G01012
BSE 11:57 | 03 Dec 61.75 -0.90
(-1.44%)
OPEN

62.05

HIGH

62.05

LOW

61.75

NSE 05:30 | 01 Jan Denis Chem Lab Ltd
OPEN 62.05
PREVIOUS CLOSE 62.65
VOLUME 1434
52-Week high 95.60
52-Week low 34.95
P/E 14.77
Mkt Cap.(Rs cr) 86
Buy Price 61.60
Buy Qty 10.00
Sell Price 61.75
Sell Qty 45.00
OPEN 62.05
CLOSE 62.65
VOLUME 1434
52-Week high 95.60
52-Week low 34.95
P/E 14.77
Mkt Cap.(Rs cr) 86
Buy Price 61.60
Buy Qty 10.00
Sell Price 61.75
Sell Qty 45.00

Denis Chem Lab Ltd. (DENISCHEMLAB) - Director Report

Company director report

Dear Members

Your Directors are pleasured to present the 40th ANNUAL REPORT together withthe Audited Financial Statements for the Financial Year 2020-21 ended 31st March2021.

1. FINANCIAL RESULTS :

(Rs. in Lakh)

Particulars 2020-21 2019-20
Operating Profit (Before Interest & Depreciation) 1059.93 1528.28
Less : Interest/Finance Cost 155.35 289.18
Profit before Depreciation 904.58 1239.10
Less: Depreciation and amortization expenses 595.86 666.45
Profit before Tax 308.72 572.65
Less: Current Tax 110.50 122.00
Less / (Add): Deferred Tax Liability / (Asset) (34.32) 28.83
Less: Short provision of earlier years 6.10 0.42
Profit after Tax 226.44 421.40

There are no material changes and commitment affecting the financial position of theCompany which have occurred between 1st April 2021 and date of this report.

2. DIVIDEND:

The Board of Directors is pleased to recommend for your approval a final dividend ofRs. 0.75 per equity share on the face value of Rs.10/- each for the year ended 31stMarch 2021. The total final dividend amounts to Rs. 104.08 Lakhs. You are requested toapprove the same. The final dividend if declared shall be payable subject to deductionof tax at source as applicable.

3. OPERATIONS:

The revenue from operations i.e. transfusion solution in Bottles and Plastic Bottlesstood at Rs. 109.32 Crores during the financial year 2020-21 under review compared to Rs.136.14 Crores of previous year 2019-20. The Company s manufacturing license is valid tillDecember 2022.

During the year under review the export market was explored in more detail and I.V.products in plastic bottles were exported to new destinations. Further efforts areunderway for increasing exports to various countries. The Company is also activelyenhancing it s product baskets in the Injectable space via 3rd PartyManufacturing so that the company s existing distribution infrastructure can be utilizedmore optimally.

4. NEW PROJECTS:

During FY 2021 the company initiated an expansion in 100 ML Eurohead Aquapulse .Thesame was completed in June 2021 adding a capacity of 1200000 bottles per month.

Due to the continuous COVID Pandemic certain growth plans of the company were kept onhold. However once normalcy is restored the company intends to pursue its growth plans andalso increase its focus on cost cutting measures.

5. COVID-19 PANDEMIC:

Due to outbreak of Covid-19 globally and in India the Company s management has madeinitial assessment of likely adverse impact on business and financial risks on account ofCovid-19. There is slow down in the business of the Company due to lockdown which hadimpact on operations. However the management does not see any medium to long term risksin the Company s ability to continue as a going concern and meeting its liabilities andcompliance with the debt covenants applicable if any.

6. LISTING:

The Equity Shares of the Company are listed on BSE Limited. The Company is regular inpayment of Annual Listing Fees. The Company has paid Listing fees up to the year 2021-22.

7. SHARE CAPITAL:

The paid up Share Capital of the Company as on 31st March 2021 was Rs.1387.67 Lakhs. As on 31st March 2021 the Company has not issued shares withdifferential voting rights nor granted stock options nor sweat equity and none of theDirectors of the Company hold any convertible instruments.

8. RESERVES:

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

9. DIRECTORS:

9.1 The Shareholders at the 39th Annual General Meeting (AGM) held on 28thSeptember 2020 have appointed Mr. Hemendrakumar C. Shah as Independent Director for aterm of five consecutive years w.e.f. 24th February 2020 to 23rdFebruary 2025.

9.2 The Shareholders at the 39th Annual General Meeting (AGM) held on 28thSeptember 2020 have re-appointed Dr. Himanshu C. Patel as Managing Director of theCompany for a period of three years w.e.f 1st August2020 to 31stJuly 2023.

9.3 Mr. Dinesh B. Patel retires by rotation in terms of the Articles of Association ofthe Company.

However being eligible offers himself for re-appointment.

9.4 The Company has received necessary declaration from each Independent Director ofthe Company under Section 149(7) of the Companies Act 2013 (the Act) that they meet withthe criteria of their independence laid down in Section 149(6) of the Act.

9.5 In terms of provisions of Section 150 of the Companies Act 2013 read with Rule6(4) of the Companies (Appointment & Qualification of Directors) Amendment Rules 2019the Independent Directors of the Company have registered themselves with the IndianInstitute of Corporate Affairs Manesar ( IICA ).

9.6 Brief profile of the Directors being appointed /re-appointed as required underRegulations 36(3) of Listing Regulations 2015 and Secretarial Standard on GeneralMeetings are provided in the Notice for the forthcoming AGM of the Company.

9.7 The Board of Directors duly met 7 times during the financial year under review. Thedetails of Board Meeting convened and held are given in the Corporate Governance Report.The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013 and circulars and regulations issued under SEBI (LODR) Regulations2015 as amended from time to time.

9.8 Formal Annual Evaluation:

The Nomination and Remuneration Committee adopted a formal mechanism for evaluating theperformance of the Board of Directors as well as that of its Committees and individualDirectors including Chairman of the Board Key Managerial Personnel/ Senior Managementetc. The exercise was carried out through an evaluation process covering aspects such ascomposition of the Board experience competencies governance issues etc.

9.9 DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the requirement of Section 134 of the Companies Act 2013 it is herebyconfirmed:

(i) that in the preparation of the annual accounts the applicable accountingstandards had been followed along with proper explanation relating to material departures;

(ii) 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 31st March2021 being end of the financial year 2020-21 and of the profit of the Company for theyear;

(iii) that the Directors had taken proper and sufficient care for maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

(iv) that the Directors had prepared the annual accounts on a going concern basis.

(v) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively.

(vi) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.

10. INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY:

The Board has adopted policies and procedures for ensuring the orderly and efficientconduct of its business including adherence to the Company s policies safeguarding ofassets prevention and detection of frauds and errors accuracy and completeness of theaccounting records and the timely preparation of reliable financial disclosures.

11. MANAGERIAL REMUNERATION:

Sr. No. Name of the Director & Designation Remuneration for the year 2020-21 % increase over last year Parameters Median of Employees Remuneration Ratio Commission received from Holding/ Subsidiary
1. Dr. Himanshu C. Patel - Managing Director Rs. 84.97 lakh - Higher responsibility and time involvement due to current expansion & modernisation Rs. 273060/- 29.83 N.A.

The Board of Directors has framed a Remuneration Policy that assures the level andcomposition of remuneration is reasonable and sufficient to attract retain and motivateDirectors Key Managerial Personnel and Senior Management to enhance the quality requiredto run the Company successfully. All the Board Members and Senior Management personnelhave affirmed time to time implementation of the said Remuneration policy.

The Nomination and Remuneration Policy are available on the Company s websitewww.denischemlab.com

12. KEY MANAGERIAL PERSONNEL:

% INCREASE IN REMUNERATION OF DIRECTORS AND KMP:

Name of the Director & KMP Designation Percentage Increase (If any)
1. Dr. Himanshu C. Patel Managing Director -
2. Mr. Nirmal Patel CEO -
3. Mr. Vikram Joshi CFO -
4. Ms. Anal R. Desai Company Secretary -

13. PERSONNEL AND H. R. D.:

13.1 INDUSTRIAL RELATIONS

The industrial relations continued to remain cordial and peaceful and your Companycontinued to give ever increasing importance to training at all levels and other aspectsof H. R. D. The number of Employees of the Company are 191. The relationship betweenaverage increase in remuneration and Company s performance is as per the appropriateperformance benchmarks and reflects short and long term performance objectives appropriateto the working of the Company and its goals.

13.2 PARTICULARS OF EMPLOYEES:

There is no Employee drawing remuneration requiring disclosure under Rule 5(2) ofCompanies Appointment & Remuneration of Managerial personnel) Rules 2014.

14. RELATED PARTY TRANSACTION AND DETAILS OF LOANS GUARANTEES INVESTMENT &SECURITIES PROVIDED:

Details of Related Party Transactions and Details of Loans Guarantees and Investmentscovered under the provisions of Section 188 and 186 of the Companies Act 2013respectively are given in the notes to the Financial Statements attached to the DirectorsReport.

All transactions entered by the Company during the financial year with related partieswere in the ordinary course of business and on an arm s length basis. During the year theCompany had not entered into any transactions with related parties which could beconsidered as material in accordance with the policy of the Company on materiality ofrelated party transactions.

The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may be accessed on the Company s website atwww.denischemlab.com

15. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO:

The information required under Section 134(3)(m) of the Companies Act 2013 and Rule8(3) of Companies (Accounts) Rules 2014 relating to the conservation of Energy andTechnology Absorption forms part of this report and is given by way of Annexure- A.

16. CORPORATE GOVERNANCE AND MDA:

As per Regulation 34 (3) read with Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 Report on Corporate Governance ManagementDiscussion and Analysis (MDA) and a certificate regarding compliance with the conditionsof Corporate Governance are appended to the Annual Report as Annexure - B.

17. SECRETARIAL AUDIT REPORT:

Your Company has obtained Secretarial Audit Report as required under Section 204(1) ofthe Companies Act 2013 from M/s. Kashyap R. Mehta & Associates Company SecretariesAhmedabad. The said Report is attached with this Report as Annexure – D. The remarksof Auditor are self explanatory.

18. CORPORATE SOCIAL RESPONSIBILITY (CSR):

The Company has constituted a Corporate Social Responsibility ( CSR ) Committee interms of the provisions of Section 135 of the Companies Act 2013 consisting of threeDirectors viz. Mr. Gaurang Dalal (as Chairman) Ms. Anar H. Patel and Dr. Himanshu C.Patel as members and has laid down a Corporate Social Responsibility Policy (CSR Policy).The CSR Policy is available on the Company s website at www.denischemlab.com.

Some of the core areas identified by the Committee are Education Health Environmentwomen empowerment Animal Welfare Hungeretc. The Company spent Rs. 8.75 lakh towards CSRfor the year 2020-21.

As per Rule 8(1) of Companies (Corporate Social Responsibility Policy) Rules 2014 theAnnual Report on CSR Activities has been attached herewith as Annexure – E.

19. ANNUAL RETURN:

The Annual Return as required under Section 92(3) of the Companies Act 2013 and Rule12 of the Companies (Management and Administration) Rules 2014 is available on thewebsite of the Company and can be accessed at www.denischemlab.com.

20. AUDIT COMMITTEE/ NOMINATION AND REMUNERATION COMMITTEE/ STAKEHOLDERS' RELATIONSHIPCOMMITTEE:

The details of various committees and their functions are part of Corporate GovernanceReport.

21. INSIDER TRADING POLICY:

As required under the Insider Trading Policy Regulations of SEBI your Directors haveframed and approved Insider Trading Policy for the Company i.e. Code of Practices andProcedures for Fair Disclosure of Unpublished Price Sensitive Information and Code ofConduct for Regulating Monitoring and Reporting of Trading by Designated Persons/Insiders. The Policy is available on the company s website.

22. AUDITORS:

STATUTORY AUDITORS:

At the 36th Annual General Meeting held on 26th September 2017M/s. H. K. Shah & Co. Chartered Accountants Ahmedabad were appointed as StatutoryAuditors of the Company to hold office for the period of 5 years i.e. for the financialyears 2017-18 to 2021-22.

The remarks of Auditor are self explanatory and have been explained in Notes onAccounts. COST AUDITORS: As per the requirement of Central Government and pursuant toSection 148 of the Companies Act 2013 read with the Companies (Cost Records and Audit)Rules 2014 as amended from time to time the Company has been carrying out audit of costrecords every year.

The Board of Directors on the recommendation of Audit Committee has appointed M/s.Kiran J. Mehta & Co. Cost Accountants (Firm Registration Number 000025) as CostAuditor to audit the cost accounts of the Company for the financial year 2021-22.

As required under the Companies Act 2013 a resolution seeking Shareholders approvalfor the remuneration payable to the Cost Auditor forms part of the Notice convening theAnnual General Meeting for their ratification.

23. GENERAL:

23.1. INSURANCE:

The movable and immovable properties of the Company including plant and Machinery andstocks wherever necessary and to the extent required have been adequately insured againstthe risks of fire riot strike malicious damage etc. as per the consistent policy of theCompany.

23.2 FIXED DEPOSITS:

The Company has not accepted any fixed deposits from the public within the meaning ofSection 73 of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules2014.

23.3 SUBSIDIARIES/ ASSOCIATES/ JVS:

The Company does not have any Subsidiaries/ Associates Companies / Joint VentureCompany. 23.4 RISK MANAGEMENT POLICY: The Company has a risk management policy which fromtime to time is reviewed by the Audit Committee of Directors as well as by the Board ofDirectors. The Policy is reviewed quarterly by assessing the threats and opportunitiesthat will impact the objectives set for the Company as a whole. The Policy is designed toprovide the categorization of risk into threat and its cause impact treatment andcontrol measures. As part of the Risk Management policy the relevant parameters forprotection of environment safety of operations and health of people at work and monitoredregularly with reference to statutory regulations and guidelines defined by the Company.

23.5 CODE OF CONDUCT:

The Board of Directors has laid down a Code of Conduct applicable to the Board ofDirectors and Senior Management. All the Board Members and Senior Management personnelhave affirmed compliance with the code of conduct.

23.6 SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

There has been no significant and material order passed by any regulators or courts ortribunals impacting the going concern status of the Company and its future operations.

23.7 ENVIRONMENT AND SAFETY:

The Company is conscious of the importance of environmentally clean and safeoperations. The Company s policy requires conduct of operations in such a manner so as toensure safety of all concerned compliances of environmental regulations and preservationof natural resources.

23.8 DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013:

The Company has in place an Anti Sexual Harassment Policy in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013. During the year under review the Company did not receive anycomplaint.

23.9 GRATUITY:

The Company has entered in to an agreement with Life Insurance Corporation of India forcovering its Gratuity Liability and has thus provided for the same. A Gratuity Trust Fundhas been created with Life Insurance Corporation of India.

23.10 INSTANCES OF FRAUD IF ANY REPORTED BY THE AUDITORS:

There have been no instances of fraud reported by the Auditors under Section 143(12) ofthe Companies Act 2013.

23.11 SECRETARIAL STANDARDS:

The Company complies with the Secretarial Standards issued by the Institute of CompanySecretaries of India which are mandatorily applicable to the Company.

24. DISCLOSURE OF ACCOUNTING TREATMENT:

In the preparation of the financial statements the Company has followed the AccountingStandards referred to in Section 133 of the Companies Act 2013. The significantaccounting policies which are consistently applied are set out in the Notes to theFinancial Statements.

25. DEMATERIALISATION OF EQUITY SHARES:

Shareholders have an option to dematerialise their shares with either of thedepositories viz NSDL and CDSL. The ISIN No. allotted is INE051G01012.

26. FINANCE:

26.1 The Company s Income-tax Assessment has been completed up to the Assessment Year2020-21 and Sales tax Assessment is completed up to the Financial Year 2017-18.

26.2 The Company is enjoying Working Capital facilities Corporate Loan and Term Loanfrom Axis Bank Limited and Bank of India. The Company is generally regular in payment ofinterest and principal.

27. ACKNOWLEDGMENT:

Your Directors express their sincere thanks and appreciation to Promoters andShareholders for their constant support and co operation. Your Directors also place onrecord their grateful appreciation and co operation received from Bankers FinancialInstitutions Government Agencies and employees of the Company.

For and on behalf of the Board
Place : Ahmedabad Dinesh B. Patel
Date : 26th July 2021 Chairman
DIN-00171089

.