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Ipca Laboratories Ltd.

BSE: 524494 Sector: Health care
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OPEN 2584.85
52-Week high 2767.10
52-Week low 1786.05
P/E 32.58
Mkt Cap.(Rs cr) 31,664
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Sell Price 0.00
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OPEN 2584.85
CLOSE 2569.90
52-Week high 2767.10
52-Week low 1786.05
P/E 32.58
Mkt Cap.(Rs cr) 31,664
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Ipca Laboratories Ltd. (IPCALAB) - Director Report

Company director report


Your Directors have pleasure in presenting the 71st Annual Report andAudited Financial Statements for the financial year ended 31st March2021.


(Rs. crores)

Rs. ( crores)



Year ended 31.3.2021 Year ended 31.3.2020 Year ended 31.3.2021 Year ended 31.3.2020
Sales and other Income 5201.40 4432.12 5482.83 4715.71
Profit before finance cost and depreciation 1575.82 979.45 1599.49 965.89
Less : Finance cost 8.14 15.79 9.04 16.50
Depreciation and Amortisation 187.72 178.69 209.17 210.50
Profit before tax 1379.96 784.97 1381.28 738.89
Less : Provision for taxation
Current Tax 244.98 137.98 248.65 140.59
Short / (Excess) provision of taxes for_earlier years - - (0.01) 0.52
Deferred Tax Asset (5.79) (5.47) (8.50) (5.78)
Net Profit 1140.77 652.46 1141.14 603.56


The Company does not propose to transfer any amount to the general reserve out of theamount available for appropriation.


The standalone and consolidated financial statements are prepared in accordance withthe Indian Accounting Standards (Ind-AS) as prescribed under Section 133 of the CompaniesAct 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules 2015 andCompanies (Indian Accounting Standards) Amendment Rules 2016.

In accordance with Indian Accounting Standard (Ind AS-110) the audited consolidatedfinancial statements are also provided in the Annual Report.


During the year under report CARE Ratings has re-affirmed CARE AA; Stable / Care A1 +(Double A; Outlook: Stable / A One Plus) ratings to the Company’s long term / shortterm bank facilities (fund based / non-fund based) amounting to Rs. 1140 crores.

CRISIL has re-affirmed ‘CRISIL A1+’ rating for Rs. 50 crores commercial paperprogramme of the Company.


The Covid-19 Pandemic has caused / continue to cause un-precedented disruption in theglobal economic activities. Several countries and central banks are implementing stimuluspackages to revive their respective economies and GDP growth.

Several countries worldwide have implemented lockdowns and other containment measuresto restrict the spread of coronavirus. The available healthcare resources andinfrastructure facilities are also majorly devoted for Covid-19 treatment.

The coronavirus pandemic is a healthcare as well as economic crisis that has shaken theglobal economy and has forced countries across the globe to take measures to correctunder-investment in the healthcare infrastructure. Going forward this pandemic will alsochange the way we operate. The consumer behavior and consumption pattern will also undergochanges.

Being manufacturers of pharmaceuticals and hence provider of essential services theoperations of the Company continued unabated albeit with challenges such as logisticstimely availability of raw materials and manpower shortages. The Company has initiatedvarious measures at its facilities and continue to vigorously follow the guidelines issuedby local authorities from time to time such as social distancing masking sanitizationetc.

The continued and uninterrupted manufacturing and supply of active pharmaceuticalingredients and dosage forms to our customers across the globe spanning over 100 countriesin these testing times and most challenging conditions have re-inforced the customerconfidence in your Company.

Overall there was no impact until now of the pandemic on the Company’s financialperformance. In the financial year 2020-21 the domestic and emerging market brandedformulations business got impacted due to lock-downs and lower patient footfall in thedispensaries OPDs and hospitals. However this got compensated by the growth in thegeneric and institutional formulations as well as Active Pharmaceutical Ingredients (APIs)business especially of Hydroxychloroquine Sulphate and Chloroquine Phosphate since thesemolecules were considered to be useful in the treatment of Covid-19 disease in the initialperiod of coronavirus outbreak.

There is no denying that we may face many more Covid-19 related uncertainties andchallenges in days to come. However your Company is confident that the inherent businessmodel of the Company which is to a great extent resilient to such market disturbanceswill navigate the challenges which are ahead of us and that the ongoing covid-19 pandemicgenerally is not expected to negatively impact our capital and financial resourcesassets profitability and liquidity position.


a. Industry Structure and Development

The global pharmaceutical market is estimated to be about US$ 1.35 trillion and washitherto growing at a CAGR of about 4%. However it is to be seen how the Covid -19pandemic which has caused unprecedented economic disruption and has put tremendouspressure on healthcare system globally will impact this industry going forward.

Though the pharmaceutical industry is developing at a rapid pace this growthwon’t come easily for the industry that is heavily influenced by healthcare reformscost pressure economic and political fluidity public demand for lower cost treatmenteconomic consolidation increased competition and changing regulatory landscape withincreased scrutiny.

The growth in the pharmaceutical industry globally is driven by ageing population aswell as about 1% increase in the global population at the same time. Improvement in thepurchasing power and increased access to healthcare system and medicines world overincluding emerging markets are also driving the growth. As population ages due toincreasing life expectancy people require pharmaceuticals to treat their chronic illnessthus increasing the demand for industry products.

Thanks to advances in science and technology the research based pharmaceuticalindustry is entering an exciting new era in medicine development. The research methods areevolving and the innovative pharmaceutical industry aims to turn fundamental research intoinnovative treatments that are widely available and accessible to patients.

b. Outlook Risks and Concerns

The Indian pharmaceuticals industry is globally respected and is one of the successfulindustries in the country. It has contributed significantly to the healthcare by ensuringquality accessible and affordable generic medicines around the globe. It has alsoimmensely contributed to India’s economic growth.

The low cost of production and R&D benefited the competitiveness of the Indianpharma industry in the international market. The Government of India has recently approvedproduction linked incentives (PLI) Scheme for the pharmaceuticals sector which willfurther improve the competitiveness of the Indian Pharma Industry and will also attractadditional investment in the sector. Indian pharmaceutical companies have also carved outa niche in both the Indian and world market with expertise in reverse engineering newprocesses for manufacturing of pharmaceuticals at low cost which became the advantage forthis industry. India is amongst the largest provider of generic drugs and vaccinesglobally and is known as the pharmacy of the world.

Although economic woes of certain geographies are impending the pharmaceutical marketgrowth the long term outlook for the industry remains positive. The industry growth isdriven by ageing population and ever growing middle income group in emerging economiesboosting demand for the pharmaceuticals. Additionally the emergence of new viruses thelatest being SARS-CoV-2 and drug resistant infections biological agents immunetherapies etc. will spur research and development activities providing the industry withmore products in their drug pipeline with revenue and growth streams.

The Indian pharmaceuticals market is the third largest in terms of volume. India is thebiggest provider of generic medications globally and enjoys a strong position in the worldpharmaceuticals sector. The country also has a huge talent pool and scientists having thecapability to steer this industry forward to a much greater degree. The cost efficiencyalso continues to create opportunities for Indian pharmaceutical companies in the emergingglobal economies. The Indian pharmaceutical industry is expected to outperform the globalpharmaceutical industry and grow in the next couple of years and thereby emerge as one ofthe top 10 pharmaceutical market globally by absolute value size.

Indian pharmaceutical companies are focusing on global generic and API businessR&D activities and contract research and manufacturing alliances. India is also fastemerging as a preferred pharmaceuticals manufacturing location. Increasing use ofpharmaceutical generics in developed markets to reduce healthcare cost will also provideattractive growth opportunities to Indian generic formulations manufacturers and thusIndian pharmaceutical industry is poised for an accelerated growth in the coming years.However poor public healthcare funding and infrastructure low per capita consumption ofmedicines in developing and under developed countries including India currencyfluctuations regulatory issues government mandated price controls inflation andresultant all round increase in input costs are few causes of concern.

During the year under report there was no change in the nature of Company’sbusiness.

c. Financial Performance and Operations Review

During the financial year under report the Company registered on a standalone basis atotal income of Rs. 5201.40 crores as against Rs. 4432.12 crores in the previous year agrowth of 17.36%. On a consolidated basis the total income of the Company has increasedby 16.27% to Rs. 5482.83 crores as against Rs. 4715.71 crores in the previous financialyear.

During the financial year under report the Earnings before interest depreciation andtaxation on a standalone basis amounted to Rs. 1575.82 crores as against Rs. 979.45 croresin the previous financial year. The operations have resulted in a net profit of Rs.1140.77crores during the financial year under report as against Rs. 652.46 crores in the previousfinancial year a growth of 74.84%.

On a consolidated basis the Earnings before interest depreciation and taxationamounted to Rs. 1599.49 crores as against Rs. 965.89 crores in the previousfinancial year. The consolidated operations have resulted in a net profit of Rs. 1141.14crores during the financial year under report as against Rs. 603.56 crores in the previousfinancial year a growth of 89.07%.

Break-up of Sales (standalone) (Rs. Crores)



Domestic Exports Total Growth Domestic Exports Total Growth
Formulations 1981.67 1597.19 3578.86 14% 1912.61 1221.55 3134.16 16%
APIs & Intermediates 386.33 1120.00 1506.33 28% 250.93 922.20 1173.13 33%
Total Sales 2368.00 2717.19 5085.19 18% 2163.54 2143.75 4307.29 20%
Growth 9% 27% 18% 17% 24% 20%

d. Key Financial Ratios (standalone)

31st March 2021 31st March 2020
1. Debtors Turnover Ratio 6.30 5.86
2. Inventory Turnover Ratio 2.77 3.11
3. Interest Coverage Ratio 188.51 62.91
4. Current Ratio 3.08 2.18
5. Debt Equity Ratio 0.03 0.11
6. Operating Profit Margin (%) 25.01% 17.19%
7. Net Profit Margin (%) 21.93% 14.72%
8. Return on Net Worth (%) 24.00% 17.74%

Due to increase in the sales and improvement in operational performance and efficiencywhich has resulted into increased profitability most of the above key financial ratioshave improved substantially. e. International Business

The products of the Company are now exported to over 100 countries across the globe.During the financial year under report the international business amounted to Rs. 2717.19crores as against Rs. 2143.75 crores in the previous year a growth of 27%. Formulationexports of the Company increased by 31% to Rs. 1597.19 crores and exports of APIs and DrugIntermediates increased by 21% to Rs. 1120.00 crores.

The Company’s formulations manufacturing sites at Silvassa and SEZ Indore and APIsmanufacturing site at Ratlam continue to be under US FDA import alert.

The Company has implemented comprehensive remedial measures at all its manufacturingsites to ensure quality and regulatory compliances. These remedial measures includedreview of all processes and procedures revamping of training system recruitment ofsenior quality personnel as well as automation of quality control laboratories. TheCompany is committed to its philosophy of highest quality in manufacturing operationssystems integrity and cGMP culture. These manufacturing sites are awaiting re-inspectionby US FDA.

Except US FDA import alert on three of its manufacturing sites none of theCompany’s manufacturing sites have any outstanding regulatory or compliance issueswith any other regulatory agency.

Continent-wise Exports (Rs. Crores)



Continent Formulations APIs and ntermediates Total % to exports Formulations APIs and Intermediates Total % to exports
Europe 496.26 260.63 756.89 28% 390.95 244.53 635.48 30%
Africa 476.78 55.81 532.59 20% 308.93 34.00 342.93 16%
Americas 173.94 398.48 572.42 21% 119.56 312.20 431.76 20%
Asia 105.92 369.66 475.58 17% 76.87 309.64 386.51 18%
CIS 163.99 24.95 188.94 7% 167.33 17.16 184.49 9%
Australasia 180.30 10.47 190.77 7% 157.91 4.67 162.58 7%
Total 1597.19 1120.00 2717.19 100% 1221.55 922.20 2143.75 100%

Formulation Exports – Therapeutic Contribution

Therapeutic Group 2020-21 2019-20
Cardiovasculars & Anti-diabetics 23% 31%
Pain Management 28% 20%
Anti-malarials 26% 19%
Anti-bacterials 5% 6%
Anthelmintics 5% 8%
Central Nervous System (CNS) products 5% 6%
Gastro Intestinal (G.I) products 4% 4%
Cough Preparations 2% 2%
Others 2% 4%
TOTAL 100% 100%


The Company achieved European export sales of Rs. 756.89 crores during the financialyear under report as against sales of Rs. 635.48 crores in the previous year a growth of19%.

The Company has developed and submitted 62 generic formulation dossiers forregistration in Europe out of which 61 dossiers are registered. The Company has alsoobtained certificate of suitability (COS) of 47 APIs from European Directorate for QualityMedicines. The Company has started marketing generic formulations in the United Kingdom inits own label.


The Company achieved export sales of Rs. 532.59 crores to Africa during the financialyear under report as against Rs. 342.93 crores in the previous year a growth of 55%.

The Company exports branded and generic formulations as well as APIs to many Africancountries. The Company markets branded formulations in Africa through dedicated fieldforce. The Company also supplies generics formulations to South Africa.

The Company is expanding its branded formulations business in this continent throughexpansion of geographical coverage and increase in the number of branded formulationsmarketed. The Company is also continuously filing new formulation dossiers forregistration in the African countries.


The Company achieved sales of Rs. 572.42 crores in this continent as against Rs. 431.76crores in the previous year a growth of 33%. As reported earlier the US formulations andAPIs business continues to be impacted due to ongoing US FDA import alert for three of theCompany’s manufacturing facilities.

46 ANDA applications of generic formulations developed by the Company are filed with USFDA out of which 18 ANDA applications are granted till date. 45 DMFs of the Company arealso currently filed with US FDA.


The Asian business (excluding India) recorded sales of Rs. 475.58 crores as against Rs.386.51 crores in the previous year a growth of 23%. The Company exports formulations aswell as APIs to several Asian countries. In countries like Nepal Sri Lanka MyanmarPhilippines and Vietnam the Company markets its branded formulations through dedicatedfield force.

Confederation of Independent States (CIS)

The Company’s CIS business recorded sales of Rs. 188.94 crores as against Rs.184.49 crores in the previous year a growth of 2%. Most of the business is from brandedformulation sales in Russia Ukraine Kazakhstan and Belarus. The Company’s brandedformulations are marketed in this continent by its own field force appointed through itsnon-trading offices.


The Company exports APIs to Australia and formulations to Australia and New Zealand inthis sub-continent. The business from this continent was Rs. 190.77 crores during thefinancial year under report as against Rs. 162.58 crores in the previous year a growth of17%. The Company has developed and submitted 75 generic formulation dossiers forregistration in this market out of which 72 dossiers are registered.

f. Domestic Formulations Business

The Company’s branded formulations business in India now comprises of 16 marketingdivisions focusing on key therapeutic segments with a portfolio of about 145 brands. YourCompany is now the 19th largest in the domestic formulations market as perIQVIA - MAT March 2021.

During the financial year under report the domestic formulations business recorded agrowth of 4% at Rs. 1981.67 crores as against Rs. 1912.61 crores in the previous year.

As a part of containment measures to restrict the spread of coronavirus apart fromlockdowns the available healthcare resources and infrastructure facilities were alsomajorly devoted by the local administration across the country for Covid-19 treatmentduring most part of the financial year 2020-21. This resulted in reduced patient footfallin dispensaries OPDs and hospitals for routine ailments as well as re-scheduling ofnon-critical surgeries which impacted prescriptions launch of new products field forceactivities and thus impacted business growth in the Domestic branded formulations market.

At the same time the Company’s APIs and formulations business ofHydroxychloroquine Sulphate and Chloroquine Phosphate significantly improved in thefinancial year during the initial phase of Covid-19 outbreak since these molecules werethen considered to be useful in the treatment of Covid-19 disease.

Domestic Branded Formulations - Therapeutic Contribution

Therapeutic segment 2020-21 2019-20
% to sales % to sales
Pain Management 52% 47%
Cardiovasculars & Anti-diabetics 19% 18%
Anti-malarials 4% 6%
Anti-bacterials 6% 8%
Dermatology 5% 5%
Gastro Intestinal (G I) products 3% 3%
Cough Preparations 3% 4%
Neuro Psychiatry 3% 3%
Urology 3% 3%
Neutraceuticals 1% 1%
Others 1% 2%
Total 100% 100%

g. Active Pharmaceutical Ingredients (APIs) and Intermediates Business

During the financial year under report the APIs and Intermediates business recordedsales of Rs. 1506.33 crores as against Rs. 1173.13 crores in the previous financialyear a growth of 28.40%. Nearly 79% of the APIs and Intermediates business is fromexports. As informed earlier the APIs business of the Company during the financial yearalso benefited from the sales of APIs Hydroxychloroquine Sulphate and ChloroquinePhosphate being molecules considered to be beneficial for the treatment of Covid-19 inthe initial phase of its outbreak.

The Company exports its APIs across the globe. Most of the international customers ofthe Company are end user formulations manufacturers including several multinationalcompanies.

Your Company is in the process of commercializing new APIs for the global market.

h. New APIs manufacturing unit at Dewas (M.P.)

The Company is in the process of setting up a new APIs manufacturing unit at Dewas(M.P.) with an initial capital outlay of about Rs. 250 crores. The land for this projecthas been acquired and the Company has already obtained all the necessary environmentalapprovals. Currently civil work for this project is ongoing at the site.

i. Intellectual Property Protection

The Company has created intellectual property management group within the Research andDevelopment centers to deal with management and protection of intellectual property. TheCompany has filed many patent applications till date in India USA and other countries.These applications relate to novel and innovative manufacturing processes for themanufacture of APIs and pharmaceutical formulations.

j. Internal Control Systems and its adequacy

The Company has adequate internal control systems including suitable monitoringprocedures commensurate with its size and the nature of the business. The internal controlsystems provide for all documented policies guidelines authorization and approvalprocedures. The Company has an internal audit department which carries out auditsthroughout the year. The statutory auditors while conducting the statutory audit reviewand evaluate the internal controls and their observations are discussed with the Auditcommittee of the Board.

k. Human Resources

The human resource plays a vital role in the growth and success of an organization. TheCompany has maintained cordial and harmonious relations with employees across variouslocations.

During the year under review various training and development workshops were conductedto improve the competency level of employees with an objective to improve the operationalperformance of individuals. The Company has built a competent team to handle challengingassignments. The Company strives to enhance the technical work related and general skillsof employees through dedicated training programs on a continuous basis.

The Company has 14574 permanent employees (including 729 overseas employees) as on 31stMarch 2021 out of which 6987 employees are engaged in the marketing and distributionactivities.

l. Cautionary Statement

Certain statement in the management discussion and analysis may be forward lookingwithin the meaning of applicable securities law and regulations and actual results maydiffer materially from those expressed or implied. Factors that would make differences toCompany’s operations include competition price realization currency fluctuationsregulatory issues changes in government policies and regulations tax regimes economicdevelopment within India and the countries in which the Company conducts business andother incidental factors.


No material changes or commitments affecting the financial position of the Company haveoccurred between the end of the financial year to which financial statements in thisreport relate and the date of this report.


The paid-up share capital of the Company as at 31st March 2021 was126852109 equity shares of Rs. 2/- each aggregating to Rs. 25.37 crores.

During the financial year pursuant to the approval of the shareholders at the ExtraOrdinary General Meeting held on 24th October 2019 in-principleapproval received from the Stock Exchanges and pursuant to applications received from theallottees to convert the warrants allotted to them into equity shares the Board ofDirectors of the Company at their meeting held on 2nd September 2020have allotted 500000 Equity shares of Rs. 2/- each fully paid-up for cash at a price ofRs. 955/- per equity share including a premium of Rs. 953/- per share aggregating to Rs.47.75 crores to members of the Promoters / Promoter Group of the Company. The proceedsfrom issue of these shares are utilized for the purposes for which the issue was made.


The Company has a scheme - Ipca Laboratories Ltd. Employees Stock Option Scheme –2014 (ESOS) approved by the Board of Directors as well as Company’s shareholders.This ESOS is in compliance with SEBI (Share Based Employee Benefits) Regulations 2014.There was no change made in this ESOS Scheme during the financial year under report.

However currently there are no outstanding options issued under the Company’sESOS.

The necessary disclosure pursuant to Regulation 14 of SEBI (Share Based EmployeeBenefits) Regulations 2014 is furnished on the website of the Company


There has been no material change in the nature of the business of the subsidiaries.The Company has no subsidiary which can be considered as material within the meaning ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

In accordance with the provisions of Section 136(1) of the Companies Act 2013 thefollowing have been placed on the website of the Company :

a) Annual Report of the Company containing therein its standalone and the consolidatedfinancial statements; and

b) Audited annual accounts of each of the subsidiary companies.

As required the financial data of the subsidiaries joint venture and associatecompanies is furnished in the prescribed Form AOC-1 as an Annexure to the consolidatedfinancial statements.

Pursuant to the provisions of Section 129(3) of the Companies Act 2013 theconsolidated financial statements of the Company are attached.


The Company has always considered Research and Development (R&D) as crucial for thesustained growth of the Company. In the recent years the Company has stepped-upinvestments in R&D to keep pace with the changing domestic and global scenario. TheCompany has R&D centers at Mumbai Ratlam Athal (Silvassa) and Ranu (Vadodara) areduly recognized by the Government of India Ministry of Science and Technology Departmentof Scientific & Industrial Research (DSIR). The R&D expenditure of the Companyduring the financial year was Rs. 126.67 crores (2.49% of the turnover) as against Rs.101.04 crores (2.35% of the turnover) in the previous year.

With qualified and experienced research scientists and engineers manning the researchand development activities the Company has focused its thrust on new and innovativeprocess and product development for the manufacture of APIs with non-infringing processes.Apart from development of new dosage forms and drug delivery systems improvement inprocesses and yield as well as cost reduction are also focus areas.


Your directors have already announced and paid in the month of December 2020 an interimdividend of Rs. 8/- per share (400%) for the financial year under report. It is now notproposed to declare any further dividend for the financial year ended 31stMarch 2021. The interim dividend paid for the financial year under report is in line withthe Company’s dividend distribution policy which is placed on the Company’swebsite

The dividend amounting to Rs. 101.48 crores paid as interim dividend will beappropriated out of the profits for the year.


The Company has transferred to the Investors Education and Protection Fund (IEPF) allthe unpaid dividend amounts required to be so transferred on or before the due date(s) forsuch transfer. The Company has also transferred to IEPF such of the Company’s equityshares in respect of which the dividend declared has not been paid or claimed for sevenconsecutive years.

The details of the unpaid / unclaimed dividends for the last seven financial years areavailable on the website of the Company

The Company has appointed its Company Secretary as the nodal officer under theprovisions of IEPF.


Mr. Premchand Godha and Mr. Prashant Godha retire by rotation at the ensuing AnnualGeneral Meeting and being eligible offer themselves for re-appointment. Mr. PrashantGodha is also proposed to be re-appointed as the Executive Director of the Company for afurther period of 5 years with effect from 16th August 2021.

Mr. Anand T. Kusre and Mr. Dev Parkash Yadava were re-appointed as IndependentDirectors for a second term of five consecutive years from 1st April 2019 andDr. (Mrs.) Manisha Premnath was re-appointed as Independent Director for a second term offive consecutive years from 21st September 2019 through postal ballot on 27thMarch 2019. The shareholders have also approved the appointment of Mr. Kamal Kishore Sethas an Independent Director for a period of 5 years from 29th March 2019.

Mr. Anand Kusre Mr. Dev Parkash Yadava Dr. (Mrs.) Manisha Premnath and Mr. KamalKishore Seth who are independent directors have submitted declaration that each of themmeets the criteria of independence as provided in Section 149(6) of the Companies Act2013 and SEBI (LODR) Regulations and there has been no change in the circumstances whichmay affect their status as independent directors during the year.

None of the directors of the Company are debarred from holding the office of Directorby virtue of any SEBI order or order by any other competent authority.

In the opinion of the Board the independent directors possess appropriate balance ofskills experience and knowledge as required. A brief note on Directors retiring byrotation and eligible for re-appointment is furnished in the Report on CorporateGovernance annexed herewith.


During the financial year under report the following persons continue to be the KeyManagerial Personnel of the Company:

Mr. Premchand Godha - Chairman & Managing Director/CEO
Mr. Ajit Kumar Jain - Joint Managing Director / CFO
Mr. Pranay Godha - Executive Director
Mr. Prashant Godha - Executive Director
Mr. Harish P. Kamath - Corporate Counsel & Company Secretary

There was no change in the Key Managerial Personnel during the financial year underreport.


The Nomination and Remuneration Committee has laid down the criteria forDirectors’ appointment and remuneration including criteria for determiningqualification positive attributes and independence of a Director. The followingattributes/criteria for selection have been laid by the Board on the recommendation of theCommittee: l the candidate should possess the positive attributes such asleadership entrepreneurship business advisor or such other attributes which in theopinion of the Committee are in the interest of the Company; l the candidate shouldbe free from any disqualification as provided under Sections 164 and 167 of the CompaniesAct 2013; l the candidate should meet the conditions of being independent asstipulated under the Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 in case of appointment as an independent director; and lthe candidate should possess appropriate educational qualification skills experience andknowledge in one or more fields of finance law management sales marketingadministration research corporate governance technical operations infrastructuremedical social service professional teaching or such other areas or disciplines whichare relevant for the Company’s business.


The Nomination and Remuneration Committee lays down the criteria for performanceevaluation of independent directors Board of Directors and Committees of the Board. Thecriteria for performance evaluation is based on the various parameters like attendance andparticipation at meetings of the Board and Committees thereof contribution to strategicdecision making review of risk assessment and risk mitigation review of financialstatements business performance and contribution to the enhancement of brand image of theCompany. The Board has carried out evaluation of its own performance as well as that ofthe Committees of the Board and all the Directors. The annual evaluation was carried outin the following manner:

Performance evaluation of Performance evaluation performed by
1. Board and individual directors Board after seeking inputs from all directors
2. Board Committees Board seeking inputs from all committee members
3. Individual Directors Nomination and Remuneration committee
4. Non-independent directors Board as a whole and the Chairman Separate meeting of independent directors after taking views from executive directors
5. Board its Committees and individual Directors At the board meeting held after the meeting of the independent directors based on evaluation carried out as above.


All the independent directors of the Company have registered their names in thedatabase maintained by the Indian Institute of Corporate Affairs Manesar Haryana. Thoseof the independent directors who are not otherwise exempted shall appear for the commonproficiency test conducted by the said institute within the prescribed time.


The objective and broad framework of the Company’s Remuneration Policy is toconsider and determine the remuneration based on the fundamental principles of payment forperformance for potential and for growth. The Remuneration Policy reflects on certainguiding principles of the Company such as aligning remuneration with the longer terminterests of the Company and its shareholders promoting a culture of meritocracy andcreating a linkage to corporate and individual performance and emphasising on lineexpertise and market competitiveness so as to attract the best talent. It also ensures theeffective recognition of performance and encourages a focus on achieving superioroperational results. The Nomination and Remuneration Committee recommends the remunerationof Directors and Key Managerial Personnel which is approved by the Board of Directorssubject to the approval of shareholders where necessary. The level and composition ofremuneration shall be reasonable and sufficient to attract retain and motivate thedirectors key managerial personnel and other employees of the quality required to run theCompany successfully. The relationship of remuneration to performance should be clear andmeet appropriate performance benchmarks. The remuneration to directors key managerialpersonnel and senior management personnel should also involve a balance between fixed andincentive pay reflecting short and long term performance objectives appropriate to theworking of the Company and its goals. The Remuneration Policy is placed on theCompany’s website

Information about elements of remuneration package of individual directors is providedin the Annual Return as provided under Section 92(3) of the Companies Act 2013 which isplaced on the website of the Company.


Details of the familiarisation programs for independent directors are disclosed on thewebsite of the Company


This information has been furnished under Report on Corporate Governance which isannexed.


Your Directors confirm:

i) that in the preparation of the annual accounts the applicable accounting standardshave been followed alongwith proper explanation relating to material departures;

ii) that your Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year March 31 2021 and of the profit of the Company for the financial year;

iii) that your Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

iv) that your Directors have prepared the annual accounts on a going concern basis;

v) that your Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively; and

vi) that your Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.


As per the requirement of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Company has complied with the requirements of Corporate Governancein all material aspects.

A report on Corporate Governance (Annexure 1) together with a certificate of itscompliance from a Practising Company Secretary forms part of this report.


During the year under review the Company has not accepted any fixed deposits and assuch no amount of principal or interest on deposits from public was outstanding as on thedate of the balance sheet.


Details of the Audit Committee along with its constitution and other details areprovided in the Report on Corporate Governance.


M/s. G. M. Kapadia & Co. Chartered Accountants (Firm Registration No. 104767W)were appointed as the Statutory Auditors at the 67th Annual GeneralMeeting (AGM) of the Company for a term of 5 (Five) years i.e. till the conclusion of 72ndAGM and this appointment was also ratified by the members of the Company at the 68thAnnual General Meeting held on Thursday 9th August 2019.

The Auditors’ Report read with the notes to the accounts referred to therein areself-explanatory and therefore do not call for any further comments. There are noqualifications reservations or adverse remarks made by the Auditors.


Pursuant to the provisions of Section 148 of the Companies Act 2013 M/s. ABK &Associates Cost Accountants (Firm Registration No. 000036) were appointed as theCost Auditors to conduct audit of cost records of the Company for the financial year2020-21.

The Cost Audit Report for the financial year 2019-20 which was due to be filed withthe Ministry of Corporate Affairs by 8th September 2020 was filed on 7thSeptember 2020.

The Company has maintained the cost accounts and cost records as specified by theCentral Government under sub-section (1) of Section 148 of the Companies Act 2013.


Pursuant to the provisions of Section 204 and other applicable provisions if any ofthe Companies Act 2013 M/s. Parikh & Associates Practising Company Secretaries wereappointed as the Secretarial Auditors for auditing the secretarial records maintained bythe Company for the financial year 2020-21.

The Secretarial Auditors’ Report is annexed hereto. There are no qualificationsreservations or adverse remarks made by the Secretarial Auditors.


The Company is committed to good corporate citizenship. As a part of its corporatesocial responsibility the Company continues to undertake a range of activities includinghealthcare and education to improve living conditions of the needy people. The CSR policyof the Company is placed on the website of the Company( Responsibility_Policy.pdf).

During the year under report the Company has also supported healthcare and educationalprojects undertaken by charitable institutions and organizations.

In May 2021 your Company has facilitated the district administration in setting upwithin the premises of its upcoming bulk drugs manufacturing unit at Dewas MadhyaPradesh a 50000 sq. ft. 250 bedded covid care centre including oxygen beds with in-houseoxygen generation plant. This is apart from various other initiatives undertaken by theCompany for covid care including distribution of oxygen concentrators PPE Kits andmedicines.

In accordance with the provisions of Section 135 of the Companies Act 2013 anabstract on Company’s CSR activities is furnished as Annexure 2 to this report.


The Company considers safety environment and health as the management responsibility.Regular employee training programmes are carried out in the manufacturing facilities onsafety environment and health.


The Company has not given any loans or guarantees or made any investments incontravention of the provisions of the Section 186 of the Companies Act 2013. The detailsof the loans and guarantees given and investments made by the Company are provided in thenotes to the financial statements.


All related party transactions that were entered into during the financial year were onarm’s length basis and were in the ordinary course of Company’s business. TheCompany has not entered into any contract arrangement or transaction with any relatedparty which could be considered as material as defined under SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015.

The Board has approved a policy for related party transactions which has been uploadedon the website of the Company.(

All the related party transactions are placed before the Audit Committee as well as theBoard for approval on a quarterly basis. Omnibus approval was also obtained from the AuditCommittee and the Board on an annual basis for repetitive transactions.

Related party transactions under Indian Accounting Standard – Ind AS 24 aredisclosed in the notes to the financial statements. Prescribed Form No. AOC-2 pursuant toclause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies(Accounts) Rules 2014 is furnished as Annexure 3 to this report.


Pursuant to the provisions of Section 197 of the Companies Act 2013 read with Rule 5of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 astatement showing the names and other particulars of the employees drawing remunerationand other details as set out in the said Rules is furnished under Annexure 4 to thisreport.

However having regard to the provisions of the first proviso to Section 136(1) of theAct and as advised the Annual Report excluding the aforesaid information is being sent tothe members of the Company. The said information is available for inspection at theregistered office of the Company during working hours excluding Saturdays and any memberinterested in obtaining such information may write to the Company Secretary and the samewill be furnished on request. The full Annual Report including the aforesaid informationis available on the Company’s website


The Board has laid down a code of conduct for board members and senior managementpersonnel of the Company. The code also incorporates the duties of independent directorsas laid down in the Companies Act 2013. The said code of conduct is posted onCompany’s website The Board members and senior management personnelhave affirmed compliance with the said code of conduct. A declaration in this regardsigned by the Chairman & Managing Director / CEO is given at the end of the CorporateGovernance Report.


There is a Whistle Blower Policy in the Company and that no personnel have been deniedaccess to the Chairman of the Audit Committee. The policy provides for adequate safeguardsagainst victimization of persons who use vigil mechanism. The Whistle Blower Policy isposted on the website of the Company


The Company has also adopted a code of conduct for prevention of insider trading. Allthe Directors senior management employees and other employees who have access to theunpublished price sensitive information of the Company are governed by this code. Duringthe year under Report there has been due compliance with the said code of conduct forprevention of insider trading. The Board has adopted a revised Code of Prevention ofInsider Trading based on the SEBI (Prohibition of Insider Trading) Regulations 2015. Thesame has been placed on the website of the Company


The Company has adopted a policy in line with the requirements of Prevention of SexualHarassment of Women at the Workplace and a Committee has been set-up to redress sexualharassment complaints received. The necessary annual report has been submitted to thecompetent authority in this regard.


Pursuant to the provisions of Section 134 of the Companies Act 2013 the Company hasconstituted a Risk Management Committee. The details of the Committee and its terms ofreference are provided in the Report on Corporate Governance which is annexed.


There are no significant or material orders passed by any regulator tribunal orcourt that would impact the going concern status of the Company and its future operations.


In accordance with the requirements of Section 134 of the Companies Act 2013statement showing particulars with respect to conservation of energy technologyabsorption and foreign exchange earnings and outgo is furnished as Annexure 5 to thisreport.


In accordance with the requirements of Section 92 (3) of the Companies Act 2013 andrule 12 (1) of the Companies (Management and Administration) Rules 2014 copy of AnnualReturn in Form MGT-7 is placed on the Company’s website (weblink:


The Business Responsibility Report of the Company for the financial year ended 31stMarch 2021 forms part of this Report. The same is also uploaded on the Company’swebsite as a part of the Annual Report.


The Company has complied with all the applicable Secretarial Standards issued by theInstitute of Company Secretaries of India.


Your Directors place on record their appreciation for the continued co-operation andsupport extended to the Company by the bankers and financial institutions. Your Directorsalso thank the medical profession the trade and consumers for their patronage of theCompany’s products. Your Directors also place on record their profound admiration andsincere appreciation of the continued hard work put in by employees at all levels.

For and on behalf of the Board
Mumbai Premchand Godha
28th May 2021 Chairman & Managing Director