Your Director's have pleasure in presenting the Directors' Report and the AuditedStatement of Accounts of the Company for the Financial Year ended 31st March 2021.
1. FINANCIAL SUMMARY/HIGHLIGHTS:
The performance of the Company during the year has been as under:
(Rs. in lakhs)
|Particulars ||2020-2021 ||2019-2020 |
|Revenue from Operations ||103.19 ||194.33 |
|Other Income (Including Exceptional Items) ||-- ||-- |
|Total Expenses ||198.72 ||182.68 |
|Profit Before Tax ||(95.53) ||11.65 |
|Less: Provision for Taxation ||(1.55) ||3.56 |
|Profit / (Loss) After Tax ||(93.98) ||8.09 |
|Other Comprehensive Income ||-- ||-- |
|Total Comprehensive Income ||(93.98) ||8.09 |
|Earning per Equity Share- Basic & Diluted (in Rs.) ||(0.92) ||0.08 |
REVIEW OF OPERATIONS/ STATE OF COMPANY'S AFFAIRS:
The total revenue of the Company for the Financial Year2020-21 under review was Rs.103.19 lakhs as against Rs.194.33 lakhs for the Previous Financial Year2019-20. Thecompany recorded a net loss of Rs.93.98 for the Financial Year 2020-21 as against the netprofit of Rs. 8.09 lakhs for the Previous Financial Year 2019-20.
2. IMPACT OF COVID 19:
The COVID-19 created havoc in the world economy and severely affected the health ofpeople at large and held the world at its standstill. Accordingly the lockdowns that wereannounced from time to time across India resulting in temporary suspension of operationsand temporary closure of offices and plants/manufacturing facilities of the Company inline with the government/local authorities' directions.
However during the lockdown your Company continued to provide support to customerswith the invaluable support of Employees/workers and Management at various levels.
3. CHANGE IN THE NATURE OF THE BUSINESS IF ANY
During the period under review and the date of Board's Report there was no change inthe nature of Business.
Pursuant to provisions of Section 134 (3) (j) of the Companies Act 2013 the companyhas not proposed to transfer any amount to general reserves account of the company duringthe year under review.
However the Closing balance of reserves of the Company as at March 31st 2021 is Rs.(89462039)/-
Keeping the Company's expansion and growth plans in mind your Directors have decidednot to recommend dividend for the Financial Year.
6. MATERIAL CHANGES & COMMITMENT AFFECTING THE FINANCIAL POSITION OF THECOMPANY
There are no major material changes and commitments affecting the financial position ofthe Company after the end of the financial year and up to date of this report.
7. BOARD MEETINGS
The Board of Directors duly met five (5) times during the Financial Year from 1st April2020 to 31st March 2021.
The dates on which the Board Meetings were held are 30.06.2020 31.07.2020 03.09.202031.10.2020 and 30.01.2021.
8. APPOINTMENT / RE-APPOINTMENT / RESIGNATION / RETIREMENT OF DIRECTORS /CEO/CFO AND KEY MANANGERIAL PERSONNEL
Mrs. Uma Jampana (DIN: 00912376) retires by rotation and being eligible offers herselffor reappointment.
Mr. Venkata Rama Mohan Raju Jampana (DIN: 00060800) is being re-appointed as ManagingDirector of the Company.
As required under regulation 36 (3) of the SEBI (LODR) Regulations 2015 briefparticulars of the Directors seeking appointment/re-appointment are given as under:
|Name of the Director ||Uma Jampana ||Venkata Rama Mohan Raju Jampana |
|Date of Birth ||15/05/1959 ||01/03/1958 |
|Qualification ||B.Com ||B.Com |
|Expertise in specific functional areas ||She has vast experience in M/s. Siris Limited. ||He has got more than 40 years of experience in pharma Industry. He started his career with M/s. Siris Limited one of the reputed pharma company in Andhra Pradesh before starting his own Indenting company M/s. Hindustan Overseas Corporation catering to the n e e d s o f p h a r m a companies in India by sourcing API Bulk Drugs P h a r m a c e u t i c a l r a w materials from China and Japan. Later he is the founder of Hindustan Biosciences Limited and is holding the position of Chairman and Managing Director for the past 20 year. |
|Names of Listed entities in which the person also holds the Directorship and the membership of Committees of the board || || |
|Shareholding of non-executive Directors/executive Directors. ||600 Equity Shares ||962091 Equity Shares |
|Inter se relationship with any Director ||Spouse of Mr.Venkata Rama Mohan Raju Jampana Managing director and mother of JampanaVarunVarma Director ||Spouse of Mrs. Uma Jampana Director and father of Jampana VarunVarma Director. |
9. DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
The Company has received declarations from Mr. Ramachandra Rao Bommaraju Mr.Ramachandra Raju Kalidindi and Mr. Mantena Satyanarayana Raju Independent Directors ofthe Company to the effect that they are meeting the criteria of independence as providedin SubSection (6) of Section 149 of the Companies Act 2013 and Regulation 25 of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
The Independent Directors have also confirmed that they have complied with theCompany's Code of Conduct.
In terms of Regulations 25(8) of the Listing Regulations the Independent Directorshave confirmed that they are not aware of any circumstance or situation which exists ormay be reasonably anticipated that could impair or impact their ability to dischargetheir duties with an objective independent judgment and without any external influence.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
Independent Directors are familiarized about the Company's operations and businesses.Interaction with the Business heads and key executives of the Company is also facilitated.Detailed presentations on important policies of the Company is also made to the directors.Direct meetings with the Chairman are further facilitated to familiarize the incumbentDirector about the Company/its businesses and the group practices.
10. POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION AND OTHER DETAILS
The assessment and appointment of Members to the Board is based on a combination ofcriterion that includes ethics personal and professional stature domain expertisegender diversity and specific qualification required for the position. The potential BoardMember is also assessed on the basis of independence criteria defined in Section 149(6) ofthe Companies Act 2013 and Regulation 27 of SEBI (LODR) Regulations 2015.
In accordance with Section 178(3) of the Companies Act 2013 and Regulation 19(4) ofSEBI (LODR) Regulations 2015 on the recommendations of the Nomination and RemunerationCommittee the Board adopted a remuneration policy for Directors Key Management Personnel(KMPs) and Senior Management. The Policy is attached a part of Corporate GovernanceReport.
We affirm that the remuneration paid to the Directors is as per the terms laid down inthe Nomination and Remuneration Policy of the Company.
11. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 134(3)(c) and 134(5) of the Companies Act 2013and on the basis of explanation given by the executives of the Company and subject todisclosures in the Annual Accounts of the Company from time to time we state as under:
1. That in the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanation relating to material departures;
2. That the Directors have selected such accounting policies and applied themconsistently and made judgment and estimates that are reasonable and prudent so as to givea true and fair view of the state of affairs of the Company at the end of the financialyear and of the profit or loss of the Company for that period;
3. That the Directors have 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 have prepared the annual accounts on a going concern basis:
5. That the Directors have lain down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
6. That the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems are adequate and operatingeffectively.
12. INVESTOR EDUCTION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of Section 124 of the Act Investor Education and ProtectionFund Authority (Accounting Audit Transfer and Refund) Rules 2016 ("IEPFRules") read with the relevant circulars and amendments thereto the amount ofdividend remaining unpaid or unclaimed for a period of seven years from the due date isrequired to be transferred to the Investor Education and Protection Fund("IEPF") constituted by the Central Government.
During the Year no amount of dividend was unpaid or unclaimed for a period of sevenyears and therefore no amount is required to be transferred to Investor Education andProvident Fund under the Section 125(1) and Section 125(2)of the Act.
13. NAMES OF THE COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES JOINTVENTURES OR ASSOCIATE COMPANIES DURING THE YEAR
During the year under review no Company has become or ceased to become itssubsidiaries joint ventures or associate Company.
14. INFORMATION ABOUT THE FINANCIAL PERFORMANCE / FINANCIAL POSITION OF THESUBSIDIARIES / ASSOCIATES/ JOINT VENTURES
During the Financial Year under review the Company does not have any subsidiariesjoint ventures or associate Companies.
15. ANNUAL RETURN
As required pursuant to Section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an annual return in MGT 7 isdisclosed on the website of the company www.hindustanbiosciences.in
a. Statutory Auditors
The members of the Company in accordance with Section 139 of the Companies Act 2013have passed a resolution for appointment of M/s. C Ramachandram& Co. CharteredAccountants Hyderabad (Firm Number 002864S) as Statutory Auditors of the Company for aperiod of 5 years in the 25thAGM held on 29.09.2017 to hold office up to the conclusion of30th Annual General Meeting of the Company.
Statutory Auditors Report
The Board has duly reviewed the Statutory Auditor's Report on the Accounts for the yearended March 31 2021 and has noted that the same does not have any reservationqualification or adverse remarks. However the Board decided to further strengthen theexisting system and procedures to meet all kinds of challenges and growth in the comingyears.
b. Secretarial Auditor
Pursuant to the provisions of Section 134(3) (f) &Section 204 of the Companies Act2013 the Board has appointed Mr.V.B.S.S.Prasad Practicing Company Secretary (C.P. No:4605) has undertaken Secretarial Audit of the Company for financial year ending31.03.2021. The report of the Secretarial Auditor is enclosed herewith vide Annexure-I ofthis Report.
Secretarial Audit Report
The Board has duly reviewed the Secretarial Audit Report for the year ended March 312021 on the Compliances according to the provisions of Section 204 of the Companies Act2013. and the comments of Board on observations in the Secretarial Audit Report aredetailed below:
i. For non compliance of provisions of Regulation 34 31 and 27 the Board has maderepresentations to the stock exchange to waive of the penalty imposed and the response ofstock exchange is awaited.
ii. Penalty imposed by stock exchange under regulation 17(1) of SEBI (LODR)
Regulations 2015 was wrongly imposed as the composition of Board is in accordance tothe Regulation 17(1) and accordingly company has made its representations and reply ofstock exchange is awaited.
iii. The penalty imposed under regulation 23(9) of SEBI (LODR)
Regulations 2015 amounting Rs. 501500/- has been paid and the company has takeneffective steps to avoid such non-compliances.
c. Cost Auditor
In terms of the provisions of Section 148 of the Companies Act 2013 read with Rule 3& 4 of The Companies (Cost Record and Audit) Rules 2014 and all other applicableprovisions of the Companies Act 2013 the Cost Audit is not applicable to the Company.
d. Internal Auditor
The Company has appointed Mr. G.B.K Vishwanadam as an Internal Auditor of the Companyfor the Financial Year 2020-2021.
17. DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SUB SECTION
(12) OF SECTION 143 OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT
There have been no frauds reported by the auditor's u/s 143(12).
18. INTERNAL AUDIT AND FINANCIAL CONTROLS
The Company has adequate internal controls consistent with the nature of business andsize of the operations to effectively provide for safety of its assets reliability offinancial transactions with adequate checks and balances adherence to applicable statuesaccounting policies approval procedures and to ensure optimum use of available resources.These systems are reviewed and improved on a regular basis. It has a comprehensivebudgetary control system to monitor revenue and expenditure against approved budget on anongoing basis.
19. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given loans Guarantees or made any investments (except for parkingexcess funds in FDs with Scheduled banks as and when required) during the year underreview.
20. RELATED PARTY TRANSACTIONS
Company has formulated a policy on related party transactions which is also availableon Company's website. This policy deals with the review and approval of related partytransactions.
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of business. There were no materialsignificant related party transactions made by the Company with the Promoters DirectorsKey Managerial Personnel or the Senior Management which may have a potential conflict withthe interest of the Company at large.
Particulars of contracts or arrangements with related parties referred to in Section188(1) of the Companies Act 2013 in the prescribed Form AOC-2 is appended as Annexure IIwhich forms part of this Report.
21. DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY TECHNOLOGYABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as prescribed under Section 134(3) (m) of the Companies Act 1956 readwith Companies (Accounts) Rules 2014 are enclosed as Annexure III.
(I). AUDIT COMMITTEE
The Audit Committee of the Company is constituted in line with the provisions ofRegulation
18(1) of SEBI (LODR) Regulations with the Stock Exchanges read with Section 177 of theCompanies Act 2013 are included in the Corporate Governance report which forms part ofthis report.
(II). NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee of the Company is constituted in line withthe provisions of Regulation 19(1) of SEBI (LODR) Regulations with the Stock Exchange readwith Section 178 of the Companies Act 2013 are included in the Corporate Governancereport which forms part of this report.
(III). STAKEHOLDERS RELATIONSHIP COMMITTEE
The Stakeholders Relationship Committee of the Company is constituted in line with theprovisions of Regulation 20 of SEBI (LODR) Regulations with the Stock Exchange read withSection 178 of the Companies Act 2013 are included in the Corporate Governance reportwhich forms part of this report.
23. VIGIL MECHANISM/WHISTLE BLOWER POLICY
In pursuant to the provisions of Section 177(9) & (10) of the Companies Act 2013read with Regulation 22 of SEBI (LODR) Regulations 2015 a vigil Mechanism for Directorsand employees to report genuine concerns has been established. It also provides fornecessary safeguards for protection against victimization for whistle blowing in goodfaith.
Vigil Mechanism Policy has been established by the Company for directors and employeesto report genuine concerns pursuant to the provisions of section 177(9) & (10) of theCompanies Act 2013. The same has been placed on the website of the Company.
24. CORPORATE SOCIAL RESPONSIBILITY (CSR COMPOSITION OF CSR COMMITTEE AND CONTENTS OFCSR POLICY)
Section 135 of the Companies Act 2013 provides the threshold limit for applicabilityof the CSR to a Company i.e. (a) net worth of the Company to be Rs.500 crore or more; or(b) turnover of the company to be Rs.1000 crore or more; or (c) net profit of the companyto be Rs.5 crore or more. As the Company does not fall under any of the threshold limitsgiven above the provisions of section 135 are not applicable to the Company.
25. PUBLIC DEPOSITS
Your Company has not accepted any deposits falling within the meaning of Sec.73 74& 76 of the Companies Act 2013 read with the Rule 8(v) of Companies (Accounts) Rules2014 during the financial year under review.
26. SIGNIFICANT & MATERIAL ORDERS PASSED BY COURTS / REGULATORS / TRIBUNALS
There are no significant and material orders passed by the regulators /courts thatwould impact the going concern status of the Company and its future operations.
27. DISCLOSURE OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS
The Internal Financial Controls with reference to financial statements as designed andimplemented by the Company are adequate. The Company maintains appropriate system ofinternal control including monitoring procedures to ensure that all assets aresafeguarded against loss from unauthorized use or disposition. Company policiesguidelines and procedures provide for adequate checks and balances and are meant toensure that all transactions are authorized recorded and reported correctly.
During the period under review there is no material or serious observations have beennoticed for inefficiency or inadequacy of such controls.
The properties and assets of your Company are adequately insured.
29. CREDIT & GUARANTEE FACILITIES
The Company has not availed any Working Capital facilities and Term Loan from Banksduring the year under review.
30. SHARE CAPITAL
The authorized share capital of the Company stands at Rs.110000000/- divided into11000000 equity shares of Rs.10/- each.
The paid-up share capital of the Company stands at Rs. 102508000/- divided into10250800 equity shares of Rs.10/- each.
31. CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION:
The Company has implemented all of its major stipulations as applicable to the Company.As stipulated under Regulation 34 read with schedule V of SEBI (LODR) Regulations 2015 areport on Corporate Governance duly audited is appended as Annexure IVfor information ofthe Members. A requisite certificate from the Secretarial Auditors of the Companyconfirming compliance with the conditions of Corporate Governance is attached to theReport on Corporate Governance.
32. MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT:
The Management Discussion and Analysis Report pursuant to Schedule Vof SEBI (ListingObligation and Disclosure Requirements) Regulation 2015 provides an overview of theaffairs of the Company its legal status and autonomy business environment mission &objectives sectoral and segment-wise operational performance strengths opportunitiesconstraints strategy and risks and concerns as well as human resource and internalcontrol systems is appended as Annexure V for information of the Members.
The SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 mandatedthe formulation of certain policies for all listed companies. All the policies areavailable on our website https://www.hindustanbiosciences.in/investors.php#tab10.
34. ENVIRONMENTS AND HUMAN RESOURCE DEVELOPMENT:
Your Company always believes in keeping the environment pollution free and is fullycommitted to its social responsibility. The Company has been taking upmost care incomplying with all pollution control measures from time to time strictly as per thedirections of the Government.
We would like to place on record our appreciation for the efforts made by themanagement and the keen interest shown by the Employees of your Company in this regard.
35. STATUTORY COMPLIANCE:
The Company has complied with the required provisions relating to statutory compliancewith regard to the affairs of the Company in all respects.
36. STATEMENT SHOWING THE NAMES OF THE TOP TEN EMPLOYEES IN TERMS OF REMUNERATION DRAWNAND THE NAME OF EVERY EMPLOYEE AS PER RULE 5(2) & (3)OF THE COMPANIES(APPOINTMENT& REMUNERATION) RULES 2014:
A table containing the particulars in accordance with the provisions of Section 197(12)of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is appended as Annexure VI(a) to this Report.
A statement showing the names of the top ten employees in terms of remuneration drawnand the name of every employee is annexed to this Annual report as Annexure VI(b).
During the year NONE of the employees is drawing a remuneration of Rs.10200000/-and above per annum or Rs.850000/- and above in aggregate per month the limitsspecified under the Section 197(12) of the Companies Act2013 read with Rules 5(2) and5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
37. RATIO OF REMUNERATION TO EACH DIRECTOR
Under section 197(12) of the Companies Act 2013 and Rule 5(1) (2) & (3) of theCompanies (Appointment & Remuneration) Rules 2014 read with Schedule V of theCompanies Act 2013 the ratio of remuneration of Managing Director (Mr.Venkata Rama MohanRaju Jampana) to the median remuneration of the employees is 0.935 respectively.
38. CODE OF CONDUCT COMPLIANCE:
All Members of the Board and Senior Management have affirmed compliance to the Code ofConduct for the Financial Year 2020-21. A declaration signed by the Managing Directoraffirming compliance with the Company's Code of Conduct by the Board of Directors andSenior Management for the Financial Year 2020-21 as required under Regulation 26(3) of theSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is included inthe Corporate Governance Report which is appended as Annexure VII' and forms part ofthis Report.
39. MECHANISM FOR EVALUATION OF THE BOARD
The Nomination and Remuneration Committee lays down the criteria for performanceevaluation of Independent Directors Board of Directors and Committees of the Board.
The criteria for performance evaluation is based on the parameters like attendance andparticipation at the meetings of the Board and Committees thereof contribution tostrategic decision making review of financial statements business performance.
The evaluation of Board of Directors is performed by the Board after seeking all theinputs from the Directors and the Board Committees by seeking inputs from the Committeemembers.
The performance evaluation of the individual directors is done by the Nomination andRemuneration Committee.
The performance evaluation of non-independent directors the Board as a whole and theChairman is done by a separate meeting of Independent Directors after taking inputs fromthe Executive directors.
40. SECRETARIAL STANDARDS
The Company is in compliance with the applicable secretarial standards.
41. EVENT BASED DISCLOSURES
During the year under review the Company has not taken up any of the followingactivities except as mentioned:
1. Issue of sweat equity share: NA
2. Issue of shares with differential rights: NA
3. Issue of shares under employee's stock option scheme: NA
4. Disclosure on purchase by Company or giving of loans by it for purchase of itsshares: NA
5. Buy back shares: NA
6. Disclosure about revision: NA
7. Preferential Allotment of Shares: NA
42. REDUCTION OF THE SHARE CAPITAL:
The Board has approved the Reduction of Share Capital from Rs. 102508000/-(RupeesTen crores twenty five lakhs eight thousand only) divided into 10250800 (one crore twolakhs fifty thousand eight hundred) equity shares of Rs 10/- (Rupees Ten only) each fullypaid-up to Rs. 20501600/- (Rupees Two crores five lakhs one thousand six hundred only)divided into 10250800 (one crores two lakhs fifty thousand eight hundred) Equity sharesof Rs 2/- (Rupees Two only) each fully paid-up by reducing face value of each equity sharefrom Rs 10/- to Rs 2/- subject to the approval of the members and Hon'ble National CompanyLaw Tribunal.
In this regard the Company has received a no objection letter dated 08.06.2021 fromBSE Limited.
43. CORPORATE INSOLVENCY RESOLUTION PROCESS INITIATED UNDER THE
INSOLVENCY AND BANKRUPTCY CODE 2016 (IBC):
There is no application filed for corporate insolvency resolution process by afinancial or operational creditor or by the company itself under the IBC before the NCLT.
44. CEO/ CFO CERTIFICATION:
The Managing Director cum CEO and CFO certification of the financial statements for theyear 2020-2021 is annexed in this Annual Report as Annexure VIII.
44. CODE OF CONDUCT FOR THE PREVENTION OF INSIDER TRADING:
The Board of Directors has adopted the Insider Trading Policy in accordance with therequirements of the SEBI (Prohibition of Insider Trading) Regulation 2015 and AmendedRegulations 2018. The Insider Trading Policy of the Company lays down guidelines andprocedures to be followed and disclosures to be made while dealing with shares of theCompany as well as the consequences of violation. The policy has been formulated toregulate monitor and ensure reporting of deals by employees and to maintain the highestethical standards of dealing in Company securities.
The Insider Trading Policy of the Company covering code of practices and procedures forfair disclosure of unpublished price sensitive information and code of conduct for theprevention of insider trading is available on our websitehttps://www.hindustanbiosciences.in
Your Directors wish to place on record their appreciation of the contribution made bythe employees at all levels to the continued growth and prosperity of your Company. YourDirectors also wish to place on record their appreciation of business constituents banksand other financial institutions and shareholders of the Company for their continuedsupport for the growth of the Company.
| ||For and on behalf of the Board of |
| ||Hindustan Bio Sciences Limited |
| ||Sd/- |
| ||Venkata Rama Mohan Raju Jampana |
|Place: Hyderabad ||Managing Director |
|Date: 18.06.2021 ||(DIN: 00060800) |