Kimia Biosciences Limited
The Directors have the pleasure of presenting the Twenty Eighth (28th)Annual Report together with the Audited Financial Statement and Auditor's Report of yourCompany for the year ended 31st March 2021.
| || ||(Rupees in Lakhs) |
|Particulars ||Year ended March 31 2021 ||Year ended March 31 2020 |
|Net Sales/ Income from operation ||13271.38 ||10628.63 |
|Total Income ||13517.00 ||10725.00 |
|Expenses ||12963.56 ||10602.40 |
|Profit before Tax ||553.44 ||122.60 |
|Less: Tax Expenses ||43.00 ||(15.51) |
|Profit After Tax ||510.44 ||138.11 |
|Other comprehensive income for the year ||(3.99) ||(116) |
|Total Comprehensive income for the year ||506.45 ||136.95 |
|Earnings per Share (Basic) ||1.08 ||0.32 |
|Earnings per Share (Diluted) ||1.08 ||0.28 |
As we march into a post-pandemic world the next few months will be challenging butyour company's robust business model strong financials and deep relationships withcustomers will play a critical role in keeping us ahead of the curve. Your company ispoised to embrace the change and take the business to new heights. A humanitarian crisisof the scale of the COVID-19 pandemic presents times of great uncertainty and change.While industries and individuals are grappling with the challenges the globalpharmaceutical industry has taken center stage in the fight against COVID-19 itscontribution ranging from vaccine development research on repurposed and novel medicinesproduction of testing kits and support to frontline workers and the needy.
The COVID-19 pandemic has disrupted economies across the world and the pharmaceuticalindustry is at the forefront in the fight against the global pandemic. The industry hasquickly adapted itself to the changed dynamics and has ensured continuity of supply sothat patients continue to get access to their medications.
The industry has also stepped in to supply medicines for the treatment of COVID-19symptoms and other associated ailments. Some of the pharmaceutical companies havedeveloped COVID-19 vaccines in record time. The pandemic is accelerating a significantchange across the healthcare ecosystem in various countries and forcing public and privatehealth systems to adapt and innovate at a pace like never before. Governments across theworld have increased spending on healthcare to counter the pandemic. There is also anincreasing realisation in middle and low income economies that healthcare relatedinvestments need to be increased which will lead to better/earlier diagnosis andappropriate treatment for patients. Another area of focus is making the supply chainresilient. This will require striking a pragmatic balance between outsourcing andself-sufficiency. Recognising the important role of the pharmaceutical industry and tostrengthen its competitiveness the Government of India has floated Production-LinkedIncentive (PLI) Schemes. The objective of these schemes is to enhance India'smanufacturing capabilities to meet global scale apart from encouraging higher investmentin R&D for the development of innovative and complex products that will enable theIndian pharmaceutical industry to meet the global demand of pharmaceutical products.
In light of the COVID-19 pandemic the pharma industry will also witness massive shiftsin R&D supply chain operations digital adoption and talent management. we are usingthis challenge as an opportunity to become more resilient more efficient and more focusedon bringing quality affordable treatments to market faster to help improve outcomes forpatients. Being a part of Essential Services the pharma industry has been particularlyresponsive to the disruption caused by COVID-19 and taken exemplary and expedited steps toensure business continuity. In fact the Operations model of pharma companies has become aready working model for resumption of manufacturing operations across industries.Overcoming input material disruptions and logistic challenges our commercial andoperational teams at Kimia are working closely with our customers and government agenciesto ensure that we are able to maintain a consistent supply of our products includingthose for the treatment of COVID-19
CHANGE IN ACCOUNTING TREATMENT
There has been no change in the accounting policies during the period under review.
The Share Capital structure of the company is as follows:
i. Authorized share capital:
|Particulars ||Amount (Rs.) |
|Equity Shares 77331680 of face value of Re. 1/- each ||77331680 |
|Compulsory Convertible Preference Share 6518320 of Re. 1/-each ||6518320 |
|0.1% Redeemable Non-Convertible Cumulative Preference Share 8000000 of Rs. 10/-each ||80000000 |
|Total Authorized Share Capital || |
ii. Issued Subscribed and Paid-up Share capital
|Particulars ||Amount (Rs.) |
|47312741Equity Shares of Re. 1/- each ||47312741 |
|80000000.1% Redeemable Non-Convertible Cumulative Preference Share of Rs. 10/- each ||80000000 |
|Total Paid-up Share Capital ||127312741 |
1. As at the end of the financial year the issued subscribed paid-up share capitalremains as above.
2. During the year the Company has converted 958790 compulsory convertible preferenceshares into equity share pursuant to Scheme of Amalgamation approved by Hon'ble NCLTChandigarh. After conversion each holder of equity shares have the same rights and shallrank pari-pasu with existing equity shares of Re. 1/- each.
3. Each preference shareholder is eligible for equal amount of dividend in casedividend is declared by the company on other class of shares. Preference shares shall ranksenior to all present and future preference shares and/or equity shares issued by theCompany. 4000000 Preference shares shall be redeemed at the option of the Company atany time within a period not exceeding ten years from the date of allotment on May 172016 and 4000000 Preference shares shall be redeemed at the option of the Company atany time within a period not exceeding ten years from the date of allotment on 07.10.2019under the provisions of the Companies Act 2013 and Rules made thereunder.
HOLDING SUBSIDIARY ASSOCIATE COMPANIES
During the period under review company has no ssubsidiary holding or Associatecompany.
Your Directors have decided to reinvest the earnings in the growth of business and forthis reason have decided to not to recommend any amount for declaration of Dividend forthe year under review Further there were no amounts of unclaimed dividend to betransferred to Investor Education & Protection Fund (IEPF) as per the provisions ofInvestor Education and Protection Fund Authority (Accounting Audit Transfer and Refund)Rules 2016.
TRANSFER TO RESERVES
Entire amount of Net Profit of Rs. 510.44 has been transferred to the Reserves. Noamount has been transferred or proposed to be transferred to any other reserves.
Your Company has not accepted any deposits from public and as such no amount onaccount of principal or interest on deposits from public was outstanding as on the date ofthe balance sheet.
LOANS GUARANTEES AND INVESTMENTS
In compliance with provisions of Section 134(3)(g) of the Actparticulars of loans guarantees investments and securities given under Section 186 ofthe Act are given in the notes to the Financial Statements forming part of this AnnualReport.
STATE OF COMPANY'S AFFAIRS
The company has achieved turnover of Rs. 13271.38 Lakhs during the financialyear with a year to year growth of 25% with a net profit of Rs. 510.44 lacs.The net profit has increased compare to previous year due to extra demand of API inpharmaceutical market..
The Company has been consistently practicing prudent finance and working capitalmanagement. The strong focus on working capital and liquidity management has helpedtimely generation of sufficient internal cash flow to invest in long term strategicobjectives of the Company.
The Company has revamped its Plant in accordance with Good Manufacturing Practice (GMP)Standards for pharmaceutical productions in past & got certification from StateFDA Haryana and continuously upgrading it to meet the international regulatoryrequirements. During the year the in addition to above company has also beengranted certificate in relation to Bilastine Briveracetam Azelnidipine and ObeticholicAcid. Also company is having a written authorization/confirmation from DGCI regardingVildagliptin Obeticholic acid and Fimasartan which plays very important role in ourExport Business.
Relevance of such license to the listed entity-
The Company shall initiate the process of manufacturing final product bulk drugs -Active Pharmaceutical Ingredients (APIs) and can market its products overseas maketscovering WHO certifications.
The Company has Research & Development (R&D) at its plant located atVillage Bhondsi Tehsil Sohna Distt. Gurgaon Haryana-122102.
The Company has planned capital expenditure to the tune of approx. 10-12 Crores duringFinancial Year 202122 for providing and upgrading facilities such as new equipments Cleanrooms (Powder processing units) separate quality and upgrading of utilities to meet withenhanced manufacturing. The ongoing expenditure is to aim at achieving the vision of thecompany for enhancement of capacities and expand the export market globally.
CHANGE IN NATURE OF BUSINESS
There has been no change in nature of business activity of the Company.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS
No significant and material orders were passed during the period under review.
The Company's philosophy on Corporate Governance aims to ensure establishing andpracticing a sound system of good corporate governance which will not only meet Company'sobjectives but will render assistance to the management in managing the company's businessin an ethical compliant efficient and transparent manner for achieving the corporateobjectives so as to provide services to the utmost satisfaction of the customer and toconduct business in a manner which adds value to the Company's brand and all itsstakeholders like shareholders employees customers suppliers vendors etc.
CORPORATE GOVERNANCE REPORT
In terms of Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 (hereinafter referred as Listing Regulations) the Paid-up Equity ShareCapital of the Company is less than 10 crore and the Net worth is less than Rs. 25 croreas on March 31 2020 as well as on March 31 2021. Thus the requirement to submitCorporate Governance Report is not applicable on the Company.
The Company has entered into an agreement with the National Securities DepositoryLimited (NSDL) as well as the Central Depository Services (India) Limited (CDSL) to enableshareholders to hold shares in dematerialized form. The Company also offers simultaneousdematerialization of the physical shares lodged for transfer.
The ISIN of the Equity Shares is INE285U01025.
The Equity Shares of your Company are listed on BSE Limited having Scrip Code 530313.
Further the Company timely paid the Annual Listing Fees to BSE Limited.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the year under review following changes took place;
1. Mr. Vipul Goel who was appointed as an additional director (liable toretire by rotation) on the Board of the company w.e.f. 07/10/2019under Non-Executive Category was regulrised as Non Executive Director on the Boardby approval of members in its 27th Annual General Meeting held on 28.09.2020.
2. Mr. Sameer Goel (DIN: 00161786) Chairman & Managing Director of theCompany who was appointed in Board meeting dated 29.03.2016 for the period of 5 years andwho has completed his tenure on 28.03.2021. Upon receiving recommendation from Nominationand remuneration committee the board has reappointed Mr. Sameer Goel as Chairman andManaging direcor of the company for the period of 5 years in its Board meeting dated25.03.2021 and who shall hold office till 28.03.2026 subject to approval of terms andconditions by members of the company in its ensuing Annual General Meeting.
3. Mr. Jagdeep Dhawan (DIN: 00778235) Indipendent Director of the Company who wasappointed in Board meeting dated 29.03.2016 for the period of 5 years and who hascompleted his tenure on 28.03.2021. Upon receiving recommendation from Nomination andremuneration committee the Board has reappointed Mr. Jagdeep Dhawan in its Board meetingdated 25.03.2021 as an Indipendent direcor of the company for the period of 5 years andwho shall hold office till 28.03.2026 subject to approval by members of the company in itsensuing Annual General Meeting.
4. Mrs. Richa Gupta (DIN: 07481646) Indipendent Woman Director of the Company whowas appointed in Board meeting dated 29.03.2016 for the period of 5 years and who hascompleted her tenure on 14.04.2021. Upon receiving recommendation from Nomination andremuneration committee the Board has reappointed Mrs. Richa Gupta in its Board meetingdated 25.03.2021 as an Indipendent woman direcor of the company for the period of 5 yearsand who shall hold office till 14.04.2026 subject to approval by members of the company inits ensuing Annual General Meeting.
The Board of Directors ("Board") comprises of optimum number of ExecutiveNon-Executive and Independent Directors as required under applicable legislations. As ondate of this Report the Board consists of four (4) Directors comprising one (1) ExecutiveManaging Director and one (1) Non-Executive Director and two (2) Independent Directorsincluding one (1) Independent Woman Director as required under Section 149 of theCompanies Act 2013 & rules made thereunder and Regulation 17 of the ListingRegulations.
During the year Ten (10) Board Meetings were held on 13.04.2020 30.05.202026.06.2020 18.08.2020 01.09.2020 05.11.2020 23.11.2020 11.02.2021 05.03.2021 and25.03.2021.
|Name of Director ||Designation/ Category ||Number of other director ship held ||Number of other Board Committees of which member/ chairperson ||Number of Board Meetings held during the tenure ||Board Meetings attended ||Attendance at the last AGM |
|Mr. Sameer Goel ||Chairman & Managing Director/ED ||4 ||NIL ||10 ||10 ||Yes |
|Mr.JagdeepDhawan ||Independent Director ||1 ||NIL ||10 ||10 ||Yes |
|Mrs. Richa Gupta ||Independent Director ||NIL ||NIL ||10 ||10 ||Yes |
|Mr. Vipul Goel ||Director/ NED ||5 ||NIL ||10 ||10 ||Yes |
DECLARATION OF INDEPENDENCE
The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet with the criteria of independence as prescribed undersub-section (6) of Section 149 of the Companies Act 2013 and SEBI Listing Regulations2015.
COMMITTEES OF BOARD AUDIT COMMITTEE
The constitution of the Committee is in compliance with the provisions of Section 177of the Companies Act 2013. During the year under review Nine (9) meetings of the AuditCommittee were held on 13.04.2020 30.05.2020 26.06.2020 18.08.2020 01.09.202005.11.2020 23.11.2020 11.02.2021 and 05.03.2021.
The composition of the Committee is given in the table below:
|Name & Designation ||Category of Directorship |
|Mr. JagdeepDhawan ||NED ID |
|Mrs. Richa Gupta ||NED ID |
|Mr. Sameer Goel ||MD |
The Chairman of the Committee attended the last AGM of the Company. The CompanySecretary acted as the Secretary to the Committee. The Statutory Auditors InternalAuditors Secretarial Auditors and other related functional executives of the Company alsoattended the meeting when required. Further the Board has accepted all the recommendationof Audit Committee during the period.
NOMINATION AND REMUNERATION COMMITTEE
The Nomination and Remuneration Committee recommends the appointment of Directors andremuneration of such Directors other than Independent Directors. During the year underreview five meetings of the Committee were held on 13.04.2020 26.06.2020 18.08.202001.09.2020 and 25.03.2021.
The composition of the Committee is given below:
|Name & Designation ||Category of Directorship |
|Mr. Jagdeep Dhawan ||NED-ID |
|Mrs. Richa Gupta ||NED ID |
|Mr. Vipul Goel ||NED |
The Company Secretary provided the secretarial support to the Committee.
NOMINATION AND REMUNERATION POLICY
In compliance with Section 178(3) of the Act the Board framed a "NominationRemuneration and Evaluation Policy" on director's appointment and remunerationincluding criteria for determining qualifications positive attributes independence of adirector. Your Directors ensures that the Company follows a Policy on Remuneration ofDirectors and Senior Management Employees. The main objective of the said policy is toensure that the level and composition of remuneration is reasonable and sufficient toattract retain and motivate the Directors KMP and Senior Management employees.
The policy of the Company on Director's appointment and remuneration is uploaded on tothe Company's website and the same is available at www.kimiabiosciences.com at thefollowing path:https://www.kimiabiosciences.com/wp-content/uploads/2020/10/1567424605Nomination-and-Remuneration-Policy.pdf.
STAKEHOLDERS RELATIONSHIP COMMITTEE
The Securities Transfer & Stakeholders Relationship Committee considers andoversees resolution of grievances of security holders and investors of the Company.
During the year the Committee met Six (6) times on 13.04.2020 26.06.2020 18.08.202005.11.2020 11.02.2021 and 25.03.2021.Company effectuated all requests for transfer ofshares consolidation and issue of duplicate share certificate within prescribed timelimits.
The composition of the Committee is given in the table below:
|Name & Designation ||Category of Directorship |
|Mr. JagdeepDhawan ||NED ID |
|Mrs. Richa Gupta ||NED ID |
|Mr. Vipul Goel ||NED |
Company Secretary provided secretarial support to the Committee.
VIGIL MECHANISM/WHISTLE-BLOWER POLICY
In compliance with the provisions of Section 177(9) &(10) ofthe Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules2014 and Regulation 22 of Listing Regulations Company formulated a vigil Mechanism forDirectors and employees to report concerns including any unethical behavior actual orsuspected frauds taking place in the Company for appropriate action thereon.
The Whistleblower policy has been hosted on Company's website viz. www.kimiabiosciences.com.
RISK MANAGEMENT POLICY
The Company has developed and implemented the Risk Management Policy and the AuditCommittee of the Company reviewed the same periodically.The Company recognizes thatrisk is an integral and unavoidable component of business and hence is committed tomanaging the risk in a proactive and effective manner. The Company'sManagement systems organizational structures processes standards code of conduct andbehaviors together form the Risk Management System of the Company and are managedaccordingly.
The common risks faced by the Company include Raw Material Procurement RiskEnvironment & Safety Risk Market Risk Technology risk Business Operational RiskReputation Risk Regulatory & Compliance Risk Human Resource Risk Working Capital andBusiness continuity Risk. Your Company has well defined processes and systems toidentify assess & mitigate the key risks. A platform for exception reportingof violations is in place which is reviewed regularly and remedial measures are beingundertaken immediately.
In compliance with the provisions of Section 134(3)(p) of the Act read with Rule 8(4)of the Companies (Accounts) Rules 2014 the Board carried out annual evaluation of itsown performance that of its Committees and individual directors.
The performance of the Board and its committees and individual directors were evaluatedby the Board after seeking inputs from all the Directors on the basis of criteria such ascomposition and structure of the Board quality of deliberations effectiveness of theprocedures adopted by the Board participation of the Board and committee meetings andgovernance reviews etc.
FAMILIARIZATION PROGRAMME OF INDEPENDENT DIRECTORS-
The Independent Directors of the Company have been updated with their roles rights andresponsibilities in the company to enable them to familiarize with Company's proceduresand practices.
The Company endeavors to familiarize the Independent Directors with the strategyoperations and functioning of the Company and also with changes in the regulatoryenvironment having significant impact on the operations of company and the PharmaceuticalIndustry as a whole.
RELATED PARTY TRANSACTIONS
All the related party transactions entered into by the Company during the year were onarm's length basis and in the ordinary course of business. Summarizedparticulars of contracts or arrangements entered into by the company with related partiesare disclosed in Notes to Financial Statements for the year.
DIRECTOR'S RESPONSIBILITY STATEMENT
a) That in preparation of the Annual Accounts for the year ended March 31 2021 theapplicable accounting standards had been followed along with proper explanation relatingto material departures if any;
b) That the directors had selected such accounting policies and applied consistentlyand made judgments and estimates that were reasonable and prudent so as to give true andfair view of the state of affairs of the Company at the end of the financial year endedMarch 31 2021 and the profits of the Company for the year under review;
c) That proper and sufficient care has been taken for the maintenance of adequateaccounting records for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;
d) That the annual accounts for the year ended March 31 2021 have been prepared on agoing concern basis.'
e) That proper internal financial control was in place and that such internal financialcontrols are adequate and were operating effectively.
f) That proper systems to ensure compliance with the provisions of all applicable lawswere in place and that such systems were adequate and operating effectively.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
Your Company strongly believes in providing a safe and harassment free workplace foreach and every individual working for the Company through various interventions andpractices. It is the continuous endeavour of the Management of the Company to create andprovide an environment to all its employees that is free from discrimination andharassment including sexual harassment. The Company has adopted a policy on preventionprohibition and redressal of sexual harassment at workplace in line with the provisions ofthe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013 and the Rules made thereunder. The Company has arranged various interactive awarenessworkshops in this regard for the employees at the manufacturing sites R & D set ups& corporate office during the year under review.
The Policies on Code of Conduct and Prevention of Workplace Harassment is displayed oncompany's website viz. www.kimiabiosciences.com. Your Directors state thatduring the year under review no cases were filed pursuant to the Sexual Harassment ofWomen at Work Place (Prevention Prohibition and Redressal) Act 2013. Your Company hascomplied with provisions relating to the constitution of Internal Complaints Committeeunder the Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal)Act 2013
DETAILS OF CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS ANDOUTGO
The disclosures to be made under sub-section (3) (m) ofSection 134 of the Companies Act 2013 read with Rule 8 (3) of the Companies(Accounts) Rules 2014 by your Company are explained as under:
(A) CONSERVATION OF ENERGY-
|(i) the steps taken or impact on conservation of energy ||The Company has pharmaceutical manufacturing unit for Bulk Drug Intermediates APIs formulations requires |
|(ii) the steps taken by the company for utilizing alternate sources of energy ||normal consumption of electricity. The Company takes all necessary steps to reduce the consumption of energy. |
|(iii) the capital investment on energy conservation equipment || |
|(B) TECHNOLOGY ABSORPTION- || |
|(i) the efforts made towards technology absorption ||The Company is engaged in the process of updating latest Technology (ies). |
| ||Processes developed for APIs: |
|(ii) the benefits derived like product improvement cost reduction product development or import substitution ||Brivaracetam Anticonvulsant |
| ||Dapagliflozin propane diol anti-diabetic |
| ||Delafloxacin meglumin antibiotic |
| ||Phenylephrine.HCl decongestant |
|(iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)- ||Rivaroxaban Bilastine ||anticoagulant antihistamine |
| ||Cost Improvements: |
|(a) the details of technology imported; ||Benidipine HCl vildagliptin ||calcium channel blocker anti-diabetic |
|(b) the year of import; (c) whether the technology been fully absorbed; ||Luliconazole ||antifungal |
| ||Key raw materials made In-House: |
|(d) if not fully absorbed areas where absorption has not taken place and the reasons thereof; and ||INB-Acetoacetate (Azelnidipine) |
| ||OBI-6-Ene acid (Obeticholic acid) |
| ||Prucalopride KSM-2 (Prucalopride) |
| ||Bilastine KSM [Bil oxo] Bilastine |
| ||Fima KSM [PYRIMIDINE AMIDE] Fimasartan |
| ||Glycidyl phthalimide (Rivaroxaban) |
| ||TPI-BOC (Tenligliptin) 3-Hydroxy acetophenone [Lab] |
| ||(Phenylephrine) Ethyl 2-Aminothiazole-4-carboxylate (Acotiamide) |
|(iv) the expenditure incurred on Research and Development ||Revenue Expenditure ||616.02 (in lakhs) |
| ||Capital Expenditure ||269.73 (in lakh) |
(C) FOREIGN EXCHANGE EARNINGS AND OUTGO-
The total foreign exchange used and the total foreign exchange earned during the yearas compared to the previous financial year has been provided hereunder:
|Foreign Exchange Earnings & Outgo ||Current Year ||Previous Year |
| ||(2020-21) ||(2019-20) |
|Inflow ||1966593 USD ||447.23 Lakhs (USD 6.29 Lakh) |
|Outflow ||8075765 USD ||6096.99 lakhs( USD- |
| ||83748 EURO ||85.14 lakhs) |
Your Company firmly believes that human resources are invaluable assets of the Company.Over the time the Company has changed to adapt and evolve with the changing economiclandscape while keeping its core value firmly entrenched. The Human ResourceDepartment of the organization has strategic and functional responsibilities for all ofthe Human Resource disciplines in the changing scenario.
On the Industrial front the Company continued to foster cordial Industrial Relationswith its workforce during the year.
COMPLIANCE WITH SECRETARIAL STANDARDS
The Institute of Company Secretaries of India a Statutory Body has issued SecretarialStandards on Board and General Meetings. The Company has complied with all the applicableprovisions of the Secretarial Standards (SS-1 and SS-2).
CORPORATE SOCIAL RESPONSIBILITY
During the year under review the provisions of Section 135 of the Companies Act 2013are not applicable to the Company.
PARTICULARS OF EMPLOYEES
The information as required under Section 197(12) of the Companies Act 2013 read withRule 5(1) &(2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 in respect of employees of the Company forms part of this report asAnnexure-V-A
DECLARATION ON COMPLIANCE WITH CODE OF CONDUCT
The Board of Directors has laid down Code of Conduct for all Board Members and SeniorManagement of the Company. The copy of Code of Conduct as applicable to the Directors(including Senior Management of the Company) is uploaded on the website of the Companywww.kimiabiosciences.com.
The Managing Director of the Company has issued a Declaration that the Members of theBoard of Directors and Senior Management Personnel have affirmed compliance with the Codeof Conduct of Board of Directors and Senior Management. As there is no Chief ExecutiveOfficer in the Company this Declaration has been issued by the Managing Director of theCompany. The Declaration is appended to this Report at the end of Management Discussionand Analysis Report as Annexure IV.
In accordance with the Regulation 17 (8) read with Part B of Schedule II to theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 pertaining to corporate governance norms. As the Company has no post ofCEO the said Certificate has been signed by the Managing director of the Company alongwith CFO. The said certificate forms an integral part of this Annual Report as AnnexureIII. The certificate has been reviewed by the Audit Committee and taken on record bythe Board of Directors.
CODE FOR PREVENTION OF INSIDER TRADING
The Company has instituted a comprehensive Code of Conduct for Prevention of InsiderTrading in compliance with Securities and Exchange Board of India (Prohibition of InsiderTrading) Regulations 2015. Further a Code of Fair Disclosure and Prevention of InsiderTrading Code under Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 2015 have been adopted and displayed on the website of the Companywww.kimiabioscences.com.
These Codes lay down guidelines vide which it advises the designated employees andconnected people on procedures to be followed and disclosures to be made while dealingwith the shares of the Company and caution them of the consequences of violations.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
In compliance with Regulation 34(3) read with Schedule V(B) of SEBI(Listing Obligations& Disclosure Requirements) Regulations 2015 a Management Discussion and Analysisforms part of this report as Annexure-I.
AUDIT AND AUDITOR'S OUTLOOK
STATUTORY AUDITORS THEIR REPORT AND NOTES TO FINANCIAL STATEMENTS
In the 24th Annual General Meeting held on 28th September 2017M/s. Singhi & Co. Chartered Accountants New Delhi (FRN302049E) had been appointed as Statutory Auditors of the Company for a period offive (5) years until the conclusion of 29th Annual GeneralMeeting.
The report of the Statutory Auditors along with Notes on Financial Statements for theyear ended March 31 2021 is enclosed with this report which is self-explanatoryand do not call for any further comments. There is no qualified opinion in AuditReport.
Further during the year the Auditors' has not reported any fraud u/s 143(12) of theCompanies Act 2013 and rules made there under.
INTERNAL FINANCIAL CONTROLS
The internal financial controls with reference to the Financial Statements commensuratewith the size and nature of business of the Company. Your Company continuously invests instrengthening the internal control processes and systems. The internal control process andsystems provide a reasonable assurance in respect of providing financial and operationalinformation complying with applicable statutes safeguarding of assets of the Company andensuring compliance with corporate policies. Procedures to ensure conformance with thepolicies processes and standards have been put in place covering all activities.
Implementations of recommendations from various audit reports are regularly monitoredby the senior management. Internal and statutory audit reports and findings includingcomments by the management if any are periodically placed before the Audit Committee ofthe Board of Directors.
Apart from in-house Internal Audit function to strengthen and maintain transparencythe Company has also appointed M/s. JKVS & Co. Chartered Accountants (FRNNo. 318086E) as Internal Auditors of the Company in accordance with Section138 of the Companies Act 2013 to examine the effectiveness of internal control system.
SECRETARIAL AUDITOR'S REPORT
In terms of Section 204 of the Companies Act 2013 and Rules made there under M/s. VLA& Associates Practicing Company Secretaries New Delhi has been appointed asSecretarial Auditors of the Company for the financial year 2020-21.
The report of the Secretarial Auditors for the year ended March 31 2021 is enclosed asAnnexure-II to this report.
As to other the report is self-explanatory and do not call for any further comments.
The Board of Directors on the recommendation of the Audit Committee appointed M/s.Mahesh Singh & Co Cost Accountants (FRN: 100441) as the Cost Auditors of the Companyfor the Financial Year 2021-22 under Section 148 of the Companies Act 2013.
M/s Mahesh Singh & Co Cost Accountants(FRN:100441) have confirmed that theirappointment is within the limits of Section 141(3) (g) of the Companies Act 2013 and havealso certified that they are free from any disqualifications specified under Section141(3) and proviso to Section 148(3) read with Section 141(4) of the Companies Act 2013.
The Company has also maintained relevant cost accounts and records as specified underSection 148(1) of the Companies Act 2013.
As per the provisions of the Companies Act 2013 the remuneration payable to the CostAuditors is required to be placed before the members in a General Meeting for theirratification. Accordingly a resolution seeking members' ratification for the remunerationpayable to M/s.Mahesh Singh & Co Cost Accountants is included in the noticeconvening the 28th Annual General Meeting.
MATERIAL CHANGES AND COMMITMENT
The provisions of the section 135 i.e. Corporate Social Responsibility (CSR) are nowapplicable to the company as the net profit of the company exceeds amount prescribed undersection 135 of the Act. Therefore the Board has duly constituted CSR Committee in itsmeeting held on 12.08.2021 to recommend and formulation of policy and action plan of theCSR spending for the FY 2021-22. Details pertaining to CSR Policy and composition of CSRCommittee can be accessed from the Company's website www.kimiabiosciences.com.
Ministry of Corporate affairs has approved reclassification of Authorised share capitalon 27.08.2021. Consequently Writ Petition No. WPC 4187/2020 filed before Honble Delhi HighCourt has become infructuous and company is in process to withdraw the said writ petition.
Except as mentined above there are no material changes and commitments affecting thefinancial position of the Company between the end of financial year of the Company and thedate of this report.
Pursuant to Section 92(3) and 134(3)(a) of the Companies Act 2013 fthe Ad') andRule 12(1) of the Companies (Management and Administration) Rules 2014 Annual Return ofthe Company is available on the website under Investor Relations' section of thecompany website i.e. WWW.kimiabiOSCiences.com and same can be accessed at the givenlink i.e.
The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review. The Board ofDirectors also wish to place on record its deep sense of appreciation for the committedservices by the Company's executives staff and workers.
Your Company has been able to operate efficiently during the year financial yearbecause of the culture of professionalism creativity integrity and continuousimprovement in all functions and areas as well as the efficient utilisation of theCompany's resources for sustainable and profitable growth. To them goes the credit for allof the Company's achievements.
And to you our Shareholders we are deeply grateful for the confidence and faith thatyou have always reposed in us.
| || ||For and on behalf of the Board |
| || ||KIMIA BIOSCIENCES LTD |
| ||Sd/- ||Sd/- |
|Place : New Delhi ||SAMEER GOEL ||VIPUL GOEL |
|Date : 28 August 2021 ||Chairman & Managing Director ||Director |
| ||(DIN: 00161786) ||(DIN: 00064274) |