Your Directors are pleased to present the 35th Annual Report of the Company along withthe Audited Financial Statements for the Financial Year ended March 31 2020.
The financial performance of the Company for the year ended 31st March 2020 issummarised below:
(Rs. in Lacs)
|Particulars ||As at ||As at |
| ||March 31 ||March 31 |
| ||2020 ||2019 |
|Sales ||2547.10 ||2450.01 |
|Other Income ||10.19 ||19.29 |
|Profit before Finance Cost || || |
|Depreciation and Tax ||273.03 ||221.04 |
|Finance Cost ||36.11 ||38.55 |
|Depreciation ||92.79 ||89.49 |
|Profit before Tax ||144.13 ||93.00 |
|Provision for Taxation || || |
|(Deferred & Current Tax) ||49.14 ||27.19 |
|Profit after Taxation ||94.99 ||65.81 |
During the year under review your Company has earned net revenue of Rs. 2557.29 Lacs asagainst Rs. 2469.29 Lacs in the previous year. The Profit before finance cost anddepreciation amounted to Rs. 273.03 Lacs as against Rs. 221.04 in the previous year.Profit after tax during the year worked out to Rs. 94.99 Lacs as compared to Rs. 65.81Lacs in the previous year.
As the world faces one of its biggest challenges caused by the CoVID-19 relateddisruptions the chemicals sector remains relatively stable from demand point of viewthough it had to face some issues related to supply chain disruptions. Presently theCompany has resumed operations and is adhering to strict safety measures and Governmentguidelines. Though the CoVID-19 related uncertainties persist the impact of the pandemicon operations of the Company is expected to be minimal. The sudden changes brought aboutby CoVID-19 has also not resulted in any significant modifications to the internalfinancial controls over financial reporting and thereby there is no impact on thefinancial statements of the Company for the financial year ended 31st March 2020.
TRANSFER TO RESERVES:
The Company does not propose to transfer any amount to the general reserve out of theamount available for appropriation.
The Board of Directors of your company after considering holistically the relevantcircumstances has decided that it would be prudent not to recommend any Dividend for theyear under review.
The paid-up Equity Share Capital of the Company as on March 31 2020 was Rs. 444.06Lacs comprising of 4440568 equity shares of Rs. 10/- each. During the year under reviewyour Company has neither issued any shares with differential voting rights nor has grantedany stock options or sweat equity. The Company has paid Listing Fees for the FinancialYear 2020-21 to the Stock Exchanges where its equity shares are listed.
CHANGE IN THE NATURE OF BUSINESS IF ANY:
There is no change in the nature of business during the financial year 2019-20.
Regulation 27 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 in connection with Corporate Governance are not applicable to theCompany since the paidup capital of the Company is less than Rs. 10 Crore and NetWorth of the Company is below Rs. 25 Crore.
MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING FINANCIAL POSITION OF THECOMPANY FROM THE END OF THE FINANCIAL YEAR TILL THE DATE OF THIS REPORT:
There has been no material change and commitment affecting the financial performanceof the Company which occurred between the end of the Financial Year of the Company towhich the financial statements relate and the date of this Report except for the impactarising out of COVID-19 which is detailed elsewhere in this Report.
Your Company does not have any subsidiary/subsidiaries within the meaning of theCompanies Act 2013.
MANAGEMENT DISCUSSION AND ANALYSIS:
A. Industry Structure and Developments: The Company is engaged in the manufacturingand selling of organic intermediates which are used in pharmaceuticals agro andspeciality chemical industries.
B. Opportunities and Threats: The Company does not envisage much competition inview of involvement of specialized technology. Tendency of sudden increase in raw materialprices due to crude price fluctuations poses a threat.
In view of your Company's Endeavour to make timely delivery of quality products to itscustomers it enjoys edge over its competitors. The Company has long standing relationshipwith many of its customers and vendors. It also recognizes the important contributions ofemployees at all levels.
C. Performance: While adhering to the provisions of stringent environmental lawsthe Company has successfully utilized the existing capacity and fared well.
D. Outlook: Your Company has been successful in executing major orders which hasresulted into repeat orders from customers. It also endeavors to reach to new customers byadopting new marketing approach. Combined efforts would result to achieving increase inturnover and profits in coming years.
E. Risks and Concerns:
A depreciated rupee has increased price of imported products. Delay in receivingclearances of competent authorities could impact the execution of the projects and couldhave negative influence on the production.
F. Internal Control Systems and their Adequacy:
The Company has an adequate system of internal control to ensure compliance withpolicies and procedures. The internal audit is done by an independent firm of CharteredAccountants. Internal audits are regularly carried out to review the internal controlsystems. The internal audit reports along with recommendations contained therein arereviewed by the Audit Committee of the Board.
G. Development in Human Resource and Industrial Relation:
The Board wishes to place on record its appreciation to all its employees for theirsustained efforts and valuable contribution. Your Company is very much concerned for theemployees so as to provide them with safe and accident free environment with a motto"Safety First" at the work place. The total employee strength of the Company ason March 31 2020 stood at 85.
EXTRACT OF ANNUAL RETURN :
Extract of Annual Return in Form MGT-9 as on 31.03.2020 is appended to this Report as Annexure"A". In compliance with Section 134(3)(a) of the Act Annual Return of theCompany can be accessed at http://linkpharmachem.co.in.
The Company has complied with the provisions for holding Board Meetings and the gapbetween any two meetings did not exceed 120 days. During the financial year under reviewfive Board Meetings were held viz. on May 30 2019 August 12 2019 September 27 2019November 14 2019 and February 14 2020.
DIRECTORS' RESPONSIBILITY STATEMENT:
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013.
(a) that in the preparation of the annual accounts for the year ended March 312020 the applicable accounting standards have been followed along with proper explanationrelating to material departures; if any;
(b) that the Directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at March 31 2020 andof the profit of the Company for the year ended on that date;
(c) that the Directors had taken proper and sufficient care for the maintenanceof adequate accounting records in accordance with the provisions of the Companies Act2013 for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(d) that the Directors had prepared the annual accounts on a going concernbasis;
(e) that the Directors had laid down internal financial controls to be followedby the Company and that such internal financial controls are adequate and were operatingeffectively; and
(f) that the Directors had devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
INDEPENDENT DIRECTOR'S DECLARATION:
The Company has received the necessary declaration from each Independent Director inaccordance with Section 149(7) of the Act that he/she meets the criteria of independenceas laid out in Section 149(6) of the Act and the Listing Regulations.
EVALUATION OF THE BOARD'S PERFORMANCE:
Pursuant to the amendments in the Companies Act 2013 and Listing Regulations theBoard has amended the Nomination and Remuneration Policy. The Board has carried out anannual performance evaluation of its own performance the Directors individually as wellas the evaluation of the working of its Committees. The Board of Directors expressed theirsatisfaction with the evaluation process.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
The Board of your Company is duly constituted in accordance with the requirements ofthe Companies Act 2013 read with the Listing Regulations.
In accordance with the provisions of Companies Act 2013 and the Articles ofAssociation of the Company Mr. Satish G. Thakur (DIN: 00292129) Director of the Companyretires by rotation at the ensuing Annual General Meeting and being eligible has offeredhimself for re-election.
Ms. Sayali Sohoni has resigned from the office of
Independent Director of the Company w.e.f 15th June 2020 due to pre-occupation. Mr.Balvant V. Retarekar has resigned from the office of Executive Chairman and Director ofthe Company w.e.f 22nd June 2020 due to preoccupation. The Board places on record theirappreciation and gratitude for their guidance and contribution during their associationwith the Company.
The Board of Directors of the Company at their meeting held on 24th June 2020 haveappointed Mr. Satish G. Thakur as a Whole-time Director of the Company for the period 3years. Appropriate resolution for the appointment of Mr. Satish G. Thakur as a Whole-timeDirector of the Company is being placed for the approval of shareholders of the Company atthis AGM. The brief resume and other related information has been detailed in the Noticeconvening 35th AGM of the Company.
Pursuant to the provisions of the Section 161(1) of the Companies Act 2013 read withthe Articles of Association of the company Mr. Rishikesh S. Thakur was appointed asAdditional Director and she shall hold office only up to the date of this Annual GeneralMeeting and being eligible offer himself for re-appointment as Director. Appropriateresolution for the reappointment of Mr. Rishikesh S. Thakur as a Director of the Companyis being placed for the approval of shareholders of the Company at this AGM. The briefresume and other related information has been detailed in the Notice convening 35th AGM ofthe Company.
RELATED PARTY TRANSACTIONS:
Related party transactions that were entered during the financial year were on an arm'slength basis and were in the ordinary course of business. Transactions with relatedparties entered by the Company in the normal course of business are periodically placedbefore the Audit Committee for its omnibus approval and the particulars of contractsentered during the year as per Form AOC-2 is enclosed as Annexure "B".
PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO:
Information required under Section 134(3)(m) of the Companies Act 2013 read with Rule8 of the Companies Accounts) Rules 2014 is given in the Annexure "C" tothis report.
DISCLOSURE UNDER RULE 5 OF COMPANIES (APPOINTMENT & REMUNERATION) RULES 2014:
Disclosures required under Section 197 of the Companies Act 2013 read with Rule 5 ofthe Companies (Appointment & Remuneration) Rules 2014 have been annexed as Annexure"D".
VIGIL MECHANISM/WHISTLE BLOWER POLICY:
In pursuant to the provisions of Section 177(9) & (10) of the Companies Act 2013a Vigil Mechanism for directors and employees to report genuine concerns has beenestablished.
(A) STATUTORY AUDITOR:
Under Section 139 of the Companies Act 2013 and the Rules made thereunder it ismandatory to rotate the statutory auditors on completion of the maximum term permittedunder the provisions of Companies Act 2013. In line with the requirements of theCompanies Act 2013 M/s. Sanjay Soni & Associates Chartered Accountants (Firmregistration number: 113251W) was appointed as the statutory auditors of the Company tohold office for a period of five consecutive years from the conclusion of the 32nd AGM ofthe Company till the conclusion of the 37th AGM to be held in the year 2022. Therequirement for the annual ratification of auditors' appointment at the AGM has beenomitted pursuant to Companies (Amendment) Act 2017 notified on May 7 2018. Hence theresolution seeking ratification of the members for their appointment is not being placedat the ensuing Annual General Meeting.
The Auditors' Report to the Members on the Accounts of the Company for the year endedMarch 31 2020 is a part of the Annual Report. The said Audit Report does not contain anyqualification reservation or adverse remark.
(B) SECRETARIAL AUDIT:
Pursuant to the provisions of Section 204 of the Act and rules made thereunder theCompany has appointed M/s. Vijay Bhatt & Co Practicing Company Secretaries (C.P. No.2265) to undertake the Secretarial Audit of the Company. The Secretarial Audit Report isannexed as Annexure "E" and forms an integral part of this Report. Thereis no secretarial audit qualification for the year under review.
The Company complies with the all applicable mandatory secretarial standards issued bythe Institute of Company Secretaries of India.
CORPORATE SOCIAL RESPONSIBILITY:
Your Company does not fall within the purview of Section 135 of the Companies Act2013.
The Company has not accepted any fixed deposits and accordingly no amount wasoutstanding as on the date of the Balance Sheet.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
There are no loans guarantees or investments falling under Section 186 of theCompanies Act 2013. However investments not falling under purview of this made by theCompany are given in the Notes to the financial statements.
RISK MANAGEMENT POLICY AND INTERNAL FINANCE CONTROL ADEQUACY:
The Company has in place a mechanism to identify assess monitor and mitigate variousrisks in achieving key objectives of the Company. The Company has developed andimplemented Risk Management Policy of the Company to identify & evaluate businessrisks and opportunities. This framework seeks to create transparency minimize adverseimpact on the business objectives and enhance the Company's competitive advantage.
The internal control systems are commensurate with the nature size and complexity ofthe business of the Company.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION PROHIBITION& REDRESSAL) ACT 2013:
The Company has safe and healthy work environment that enables its employees to workwithout fear prejudices gender bias and sexual harassment and also set up guideline inline with the requirement of The Sexual Harassment of Women at workplace (Prevention
Prohibition & Redressal) Act 2013. During the financial year 2019-20 no complaintwas received under the policy.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALSIMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE:
There are no significant or material orders which were passed by the Regulators orCourts or Tribunals which impact the going concern status and the Company's
Operations in future.
APPRECIATION AND ACKNOWLEDGEMENT:
Your Directors take this opportunity to thank the employees customers vendorsinvestors and bankers of the Company and the communities in which the Company operatesfor their unstinted co-operation and valuable support extended during the year. YourDirectors appreciate and value the contributions made by each and every members of theCompany.
| ||BY ORDER OF THE BOARD OF DIRECTORS |
| ||FOR LINK PHARMA CHEM LIMITED |
| ||SATISH G. THAKUR |
|DATE: 05/08/2020 ||CHAIRMAN |
|PLACE: VADODARA ||(DIN: 00292129) |