Your Directors are pleased to present the Annual Report along with the auditedfinancial statements for the financial year ended March 31 2020 ("year underreview").
Summary of Financial Results
(Rs. in million)
| ||2019-20 ||2018-19 |
|Revenue from Operations ||4382.5 ||4906.8 |
|Total Income ||4743.9 ||5689.4 |
|Profit before Tax ||286.4 ||857.7 |
|Profit for the year ||100.8 ||517.7 |
|Other Comprehensive Income for the year ||(197.3) ||16.2 |
|Balance brought forward from previous year ||7474.6 ||7238.4 |
|Available for appropriation || || |
|The Directors have made the following appropriations: || || |
|Dividend ||246.9* ||246.9 |
|Dividend distribution tax ||50.8* ||50.8 |
|Buy-back of equity shares ||0 ||0 |
|Amount transferred to Capital Redemption Reserve ||0 ||0 |
|Carry forward ||7080.4 ||7474.6 |
* Note : Di vidend and Dividend distribution tax relates to FY 2018-19 paid during FY2019-20
The Board has recommended payment of dividend at Rs. 10 per equity share of Rs. 5 eachfor the financial year 2019-20. The said dividend if approved by the members at theAnnual General Meeting ("AGM") will result in a cash outflow of Rs. 247million. The Board continues to support a steady dividend policy and the recommendeddividend is in accordance with the Dividend Distribution Policy of the Company. A copy ofthe said Policy is available on the website of the Company at www.novartis.in.
Management Discussion and Analysis
For the year under review the business operations of the Company comprisesPharmaceuticals.
a. Economy Industry and developments
India's economic growth in terms of GDP for Financial Year 2019-20 has significantlydeclined to around 4.2 percent which is at its lowest in 11 years. This is primarily dueto lower consumer sentiment lack of growth in demand and plummeting of capacityutilization levels. Reduction in corporate tax rates and stabilizing of interest rates byReserve Bank of India had only a limited boost to growth rates. Even annual consumerprice inflation was increased to 4.8 per cent in FY 2019-20 from 3.4 per cent in FY2018-19.
Decelerating manufacturing sector rising unemployment and slowing wage growth in ruralareas were some of the concerns for slow economic growth.
A stable government at the Centre presents an opportunity to push further reforms butexecution of these reforms at the ground level will remain key to their success. TheGovernment is expected to continue to prioritize welfare policies and programs includingimproving housing and expanding access to healthcare. While potential impact of thepandemic on the economy is yet to be ascertained some of the fiscal and monetary stimulusmeasures if implemented properly could accelerate India's growth prospects in future.
India's healthcare system still remains inadequate to provide care to a population of1.3 billion especially in rural areas. The National Health Policy (NHP) 2017 callsfor an increase in the government's contribution to healthcare spending to 2.5% of GDP by2025 which is still a long way to go. The government aspires to increase it to 3% but tofulfill such aspirations it requires serious and focused intent by the governmenttogether with targeted spends to build and improve healthcare infrastructure in primaryand secondary care centers. There is also a need to make the overall ecosystem swiftincluding making research and healthcare institutions more contemporary and adaptive tonewer domains of technology. Covid-19 is expected to have a less prominent impact on thepharmaceutical sector as compared to other industries. Nevertheless there were supplychain challenges during the nationwide lockdown and patients have postponed their visitsto healthcare professionals and institutions which had some impact on the sector.However it is important to note that this pandemic has also presented many opportunitiesfor change as can be seen from an emerging trend of increase in e-pharmacies telemedicineand teleconsultation platforms along with adoption of various digital tools forinteractions with healthcare professionals patients pharmacies and pharmaceuticalcompanies. Building new commercial operating models new capabilities and leveraging ondigital transformation could become key differentiators for pharmaceutical players.
It is encouraging to note that the Pradhan Mantri Jan Arogya Yojana (PMJAY) thenational health protection scheme under Ayushman Bharat' is gradually increasingcoverage for secondary and tertiary care to poor and vulnerable people thereby expandinghealthcare reach of the country. Expansion of PMJAY to other sections of people viz.middle class would have a positive impact on the industry.
The Indian Pharma Market ("IPM") is forecast to grow at a Compounded AnnualGrowth Rate (CAGR) of 9.3%* (+/- 2.0%) over the next four years to reach Rs. 2396.2billion by 2024. However it continues to be a highly fragmented and a competitive marketwith a large number of players spread across therapeutic segments.
Revenue from operations for the year ended March 31 2020 was Rs. 4382.5 millionrepresenting a decrease of 10.7% over the previous year.
Profit before tax for the year stood at Rs. 286.4 million representing a decrease of66.6% over the previous year. The previous financial year 2018-19 included extraordinaryincome of Rs. 307.3 million from the sale of certain assets classified under Assets heldfor sale. In addition the current year had a reduction in interest income of Rs. 90million due to reduced interest rates.
Covid-19 pandemic and nationwide lockdown / restrictions had some impact on businessdue to limited operations at contract manufacturing sites. There were instances of delayin import clearances and in local supply chain activities which affected the suppliesinitially. Due to limited supplies there was product substitution at local pharmacylevels. In addition many patients have postponed their visits to healthcareprofessionals many OPDs / Nursing homes were non-operational during this period and allthese resulted in no new prescription generation. Even a national agency like the NationalOrgan and Tissue Transplant Organisation (NOTTO) has temporarily suspended the livingdonor transplant program due to associated high risk. While restrictions are easing outgradually the Company continues to devote significant resources and management attentionto ensure business continuity and uninterrupted supplies to patients and customers. TheCompany is also leveraging various digital platforms and technology to engage with all itsstakeholders especially its patients. The incredible agility and resilience shown by ouremployees in switching to new digital ways of working ensured that we could continue tooperate during this challenging period.
c. Operational performance
The Pharmaceuticals business registered Net Revenue from Operations of Rs. 4382.5million representing a decrease of 10.7% over the previous year. Among the factorsthat affected results for the year under review were global divestment of a fewophthalmologic products by the brand owner transition of a marketing partner in CentralNervous System (CNS) portfolio to in-house promotion and certain supply constraints. TheCompany's other operating income from consignment services clinical research supportservices and field force support services was affected due to optimization of businessesin those verticals. To mitigate the impact of decline in revenues and protect theCompany's operating profits cost containment measures were undertaken during the year.
However the Pain and Transplant portfolio has recorded a growth during the year underreview resulting from focused sales and increased marketing efforts. The Company isextensively involved in scientific engagement with healthcare professionals and keyinstitutions to drive awareness on prevention of infections and has developed a robustdigital strategy for customer engagements and for enhancing brand reach.
The Company's Voveran group of products continues to be one of the top brands in theNon-Steroidal Anti-Inflammatory Drugs (NSAID) market and ranks among the top 3 in India.With new products Voveran 1ml AQ already in the market the Company expectsto further strengthen its position by serving more patients while continuing to havescientific engagements and leveraging digital strategic initiatives with its stakeholders.
The following brands hold key positions in major therapeutic areas such as:
|Therapeutic Area ||Therapeutic Area Product |
|Central Nervous System ||Tegrital Exelon |
|Pain & Inflammation ||Voveran |
|Transplantation/Immunology ||Simulect Certican Myfortic Sandimmun |
| ||Neoral |
d. K ey Financial Indicators
|Operating profit margin (%) ||(0.3) ||1.9 |
|Net profit margin (%) ||2.3 ||10.6 |
|Debtors turnover ratio ||10.5 ||11.0 |
|Current ratio ||3.5 ||4.4 |
|Return on Net Worth ||1.4 ||6.8 |
|Inventory turnover ratio ||7.4 ||8.4 |
|Interest coverage ratio ||NA ||NA |
|Debt equity ratio ||NA ||NA |
Reasons for change compared to the previous financial year in some of the key financialratios is as follows:
Operating profit margin
Operating profit margin is a profitability or performance ratio used to calculate thepercentage of profit a company produces from its operations. It is calculated by dividingthe operating earnings before interest and tax by turnover. The operating margins areimpacted due to lower Sales during the year under review.
Profit Net margin
The net profit margin is equal to how much net income or profit is generated as apercentage of revenue. It is calculated by dividing profit for the year by turnover. Netprofit margin in FY 2019-20 is lower compared to FY 2018-19. Previous FY 2018-19 includesextraordinary income of Rs. 307.3 million on disposal of certain assets classified underAssets held for sale. In addition current financial year 2019-20 had a reduction ininterest income of Rs. 90 million due to reduced interest rates.
Debtors turnover ratio
It is calculated by dividing turnover by average trade receivables to quantify acompany's effectiveness in collecting its receivables. The change is driven mainly due todecrease in revenue.
The current ratio is a liquidity ratio that measures a company's ability to payshort-term obligations or those due within one year. It is calculated by dividing thecurrent assets by current liabilities. Since the Company had higher otherfinancial liabilities' as at March 31 2020 it led to lower current ratio.
Return on Net Worth
Return on Net Worth is a measure of profitability of a company expressed in percentage.It is calculated by dividing profit for the year by total equity. Return on net worth inFY 2019-20 is lower compared to previous year as FY 2018-19 had extraordinary income onaccount of sale of assets.
Inventory turnover ratio
Inventory turnover is the number of times a company sells and replaces its inventoryduring a period. It is calculated by dividing turnover by average inventory. Lower salesin FY 2019-20 consequently led to lower turnover ratio.
Interest coverage ratio
The interest coverage ratio measures how many times a company can cover its currentinterest payment with its available earnings. It is calculated by dividing profit beforeinterest and tax by finance cost. The Company does not have any debts as at March31 2020 and March 31 2019 and hence this ratio is not given in the table.
Debt equity ratio
The ratio is used to evaluate a company's financial leverage. It is a measure of thedegree to which a company is financing its operations through debt versus wholly ownedfunds. The Company does not have any debts as at March 31 2020 and March 31 2019 andhence this ratio is not given in the table.
Control of prices of certain drugs under the Drug Price Control Order (DPCO) continuesto affect the profitability of the pharmaceutical industry. Revision of the National Listof Essential Medicines (NLEM) could result in expansion of price controls under the DPCOwhich would put further downward pressure on drug prices. Building investments innon-traditional opportunities coupled with heightened competition and a rising cost oftalent will result in margin pressures.
The Indian Pharma Market (IPM) is dominated by generic medicines and these drugsaccount for nearly 75% of the pharma industry. Prescription by generic names could alsohave an impact on pharma companies and it could necessitate a change in the Company'spromotional strategies. Regulations to cap trade margins on non-scheduled products couldimpact the business model for trade generics.
Novartis AG which is the Company's holding company owns directly or indirectlyseveral companies in Novartis Group worldwide including various brands and patents.Therefore any merger acquisition divestment or restructuring by Novartis AG or itssubsidiaries would have an influence on the Company's operations in India as well.
The Government at the centre has a strong mandate and this works in the country'soverall favour as it means more stability. In addition it also becomes relatively easierto continue to prioritise welfare programs such as those aimed at providing support tofarmers improving housing conditions and expanding access to healthcare. However theeffectiveness of such programs may be undermined by problems in their implementation aswell as funding shortfalls. Government's aspiration to contribute upto 3% of GDP onhealthcare by 2025 expansion of PMJAY and new regulations for operation of e-pharmaciestelemedicine and the like is encouraging to note but the key remains timely executionfocused approach and targeted spends in improving health infrastructure.
The ongoing crisis due to the Covid-19 pandemic has impacted the short term outlook forthe economy. The pharmaceutical industry is to some extent in a slightly better placegiven the increased focus on health. However there are various parameters such asavailability of healthcare infrastructure emerging new commercial models adoption of newtechnologies new policy reforms together with several macro-economic factors like changesin crude oil prices commodity inflation potential disruptions due to global eventsproblem of non-performing assets a below normal monsoon etc. which could have an impacton GDP growth in future.
g. Internal control systems and their adequacy
The Company maintains appropriate systems of internal control including monitoringprocedures to ensure that all assets are safeguarded against loss from unauthorized useor disposal. Company policies guidelines and procedures provide for adequate checks andbalances and are meant to ensure that all transactions are authorized recorded andreported correctly.
The Head of Internal Audit together with external audit consultants reviews theeffectiveness and efficiency of these systems and procedures to ensure that all assets areprotected against loss and that the financial and operational information is accurate andcomplete in all respects. The Audit Committee approves and reviews audit plans for theyear based on internal risk assessment. Audits are conducted on an ongoing basis andsignificant deviations are brought to the notice of the Audit Committee of the Board ofDirectors following which corrective action is recommended for implementation. All thesemeasures facilitate timely detection of any irregularities and early remedial steps.During the year the Company conducted a detailed review of its internal control systemsevaluated the internal financial control systems with the Audit Committee and discussedrelevant issues with internal and statutory auditors. Based on the recommendations of theAudit Committee the Board has stated in its responsibility statement that the Companyfollowed proper internal financial controls and that such internal financial controls areadequate and were operating effectively.
h. Vigil Mechanism
The Company has established a Vigil Mechanism and Whistleblower policy that enables theDirectors and employees to report genuine concerns. The said Policy provides for (a)adequate safeguards against victimization of persons who use the Vigil Mechanism; and (b)direct access to the Chairperson of the Audit Committee of the Board of the Company inappropriate or exceptional cases. Details of the Vigil Mechanism and Whistleblower policyare made available on the Company's website www.novartis.in.
Industrial Relations scenario continued to be cordial. The Company regards itsemployees as a great asset and accords high priority to training and development ofemployees. Number of employees as on March 31 2020 was 552.
T he information required pursuant to Section 197 of the Companies Act 2013 ("theAct") read with Rule 5 of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 in respect of employees of the Company will be provided uponrequest. In terms of Section 136 of the Act the Report and Accounts are being sent to themembers and others entitled thereto excluding the information on employees' particularswhich is available for inspection by the members. If any member is interested in obtaininga copy thereof such member may write to the Company Secretary & Compliance Officer ofthe Company in this regard.
Corporate Social Responsibility
The Company continues to support various initiatives in the areas of health educationand environment. The CSR Policy adopted by the Board of Directors is available on theCompany's website www.novartis.in.
Health: India has around 60% of the world's leprosy caseload and leprosy continuesto be an area of focus for the Company's CSR work in India. The Leprosy Post ExposureProphylaxis (LPEP) project was launched in the union territory of Dadra & Nagar Haveliin March 2015 and was completed in July 2019. Over the duration of the project 55197people were screened for leprosy with a prophylactic dose for prevention of transmissionof leprosy being given to 39933 eligible persons. 291 new cases of leprosy were detected.Two full day workshops were conducted in Delhi and Telangana for 60 District LevelOfficers of the National Leprosy Eradication Programme to share learnings.
The Company also continued to support a non-profit organization in Telangana to set upan integrated health management system which will result in digitization of over 22000leprosy records in the hope that this data will eventually serve to drive early diagnosisof leprosy. The Company continued its health awareness initiative through its HealthyFamilies program Arogya Parivar reaching out to more than 9.55 million individualsacross rural India and conducted 237927 health education programs and 7309 health campsin the year under review.
The Company initiated a much-needed programme centered on health awareness to reducethe incidence of non-communicable diseases for low-income families and slum dwellers in 13municipal wards of Mumbai.
Education: Lack of education is a huge drawback for children coming fromimpoverished backgrounds serving to strengthen the cycle of poverty. Education takes aback seat as parents prefer their children to contribute to the family income rather thango to school. The Company supported the continuation of learning for 250 children byupgrading a school damaged by the Kerala floods in 2018 work for which was completedduring the year under review.
Environment: The absence of adequate green cover and with it open spaces continuesto be a sore point for the city of Mumbai. The Company has continued with its contributionin this area by supporting the upkeep of a beautiful garden in the heart of the city.
Community Partnership Week has been growing from strength to strength as can be seenfrom the growing number of employees who participate in a meaningful way. Activities thatare supported range from painting the interiors of a home for people suffering from cancerto creating educational aids for less privileged schools to donating blood for childrensuffering from thalassemia.
The Annual Report on Corporate Social Responsibility Activities is annexed herewith as
Related Party Transactions
The Audit Committee and the Board approved all Related Party Transactions entered intoduring the year under review from time to time.
The Audit Committee has granted omnibus approval for Related Party Transactions as perthe provisions and restrictions contained in the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015. ("SEBI ListingRegulations").
The Company has formulated a policy on materiality of Related Party Transactions and ondealing with Related Party Transactions. The policy is available on the Company's websitewww.novartis.in.
Further in terms of the provisions of section 188(1) of the Act read with theCompanies (Meetings of Board and its Powers) Rules 2014 and Regulation 23 of the SEBIListing Regulations all contracts/arrangements/ transactions entered into by the Companywith its related parties during the year under review were:
in "ordinary course of business" of the Company;
on "an arm's length basis"; and
All transactions with related parties are in accordance with the policy on relatedparty transactions formulated by the Company.
Pursuant to Clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014 the particulars of contracts/arrangements enteredinto by the Company with related parties referred to in sub-section(1) of Section 188 ofthe Act including certain arm's length transactions under third proviso thereto arerequired to be disclosed in Form AOC2. Form AOC2 envisages disclosure ofmaterial contracts or arrangement or transactions on arm's length basis.
Details of the material Related Party Transactions in financial year 2019-20 as perthe Policy on dealing with Related Parties adopted by the Company are disclosed in AnnexureB. The transactions disclosed in the Annexure relates to material Related PartyTransactions with Novartis Pharma AG for purchase transfer or receipt of products goodsactive pharmaceutical ingredients materials services other obligations as approved bymembers under erstwhile Clause 49(VII)(E) of the listing agreement at the 67thAnnual General Meeting of the Company held on July 23 2015.
The Company has devised and implemented a mechanism for risk management and hasdeveloped a Risk Management Policy. The Policy provides for constitution of a RiskManagement Committee. The Committee has created a Risk Register and works towards reviewand identification of internal and external risks and implementation of risk mitigationsteps. The Company provides updates on risk management to the Audit Committee of the Boardof Directors of the Company on a regular basis.
The Company has not accepted deposits from the public falling within the ambit ofSection 73 of the Companies Act 2013 and the rules framed thereunder.
Particulars of Loans Guarantees or Investments
As on March 31 2020 there were no outstanding loans or guarantees covered under theprovisions of Section 186 of the Act. The details of changes in the Loans Guarantees andInvestments covered under the provisions of Section 186 of the Act are given in the notesto the Financial Statements.
Board of Directors and Key Managerial Personnel
During the year under review the Board of Directors based on the recommendation ofthe Nomination & Remuneration Committee appointed Mr. Sanjay Murdeshwar as ViceChairman & Managing Director of the Company with effect from June 15 2019. Members ofthe Company through an Ordinary resolution at the 71st AGM of the Company heldon August 9 2019 approved the aforesaid appointment for a period of 5 years. The term ofDr. Rajendra Nath Mehrotra as Independent Director of the Company ended on March 31 2020.
The Board of Directors based on the recommendation of the Nomination and RemunerationCommittee and after considering the integrity expertise and experience (including theproficiency) of Mr. Sanker Parameswaran has approved his appointment as AdditionalDirector (Independent and Non-Executive) of the Company to hold office for a period of 5consecutive years with effect from June 22 2020. Appointment of Mr. Parameswaran as anIndependent Director of the Company will be subject to the approval of the shareholders ofthe Company. Ms. Monaz Noble has been functioning on the Board of the Company in aNon-Executive and Non-Independent capacity effective June 1 2019. Ms. Noble retires byrotation and being eligible offers herself for re-appointment. Necessary resolutions forthe appointment and re-appointment of Directors together with details for appointment andre-appointment have been included in the Notice convening the ensuing AGM.
The Company has received necessary declaration from each Independent Director of theCompany stating that they meet the criteria of independence as provided in section 149(6)of the Act and Regulation 16(1)(b) of the SEBI Listing Regulations. Based on thedeclarations received from independent directors and in the opinion of the Board ofDirectors the Independent Directors of the Company fulfill the conditions of independenceand are independent of the management.
Appropriate details on Board and Committee composition number of meetings of the Boardand Committees and other Corporate Governance matters are elaborated in the Report onCorporate Governance which forms part of this Annual Report and other CorporateGovernance matters are elaborated in the Report on Corporate Governance which forms partof this Annual Report.
Pursuant to the provisions of Section 203 of the Act the Key Managerial Personnel ofthe Company as on March 31 2020 are:
i. Mr. Sanjay Murdeshwar - Managing Director;
ii. Mr. Felix Doss - Chief Financial Officer; and
iii. Mr. Trivikram Guda - Company Secretary & Compliance Officer.
Based on the recommendation of the Nomination and Remuneration Committee the AuditCommittee and the Board of Directors at its meeting held on May 23 2019 appointed Mr.Felix Doss as Chief Financial Officer of the Company with effect from June 1 2019. Saidappointment is in accordance with the applicable provisions of the Act and the SEBIListing Regulations.
Directors' Responsibility Statement
The audited financial statements of your Company for the year under review("financial statements") are in conformity with the requirements of theCompanies Act 2013 read with the rules made thereunder and the Accounting Standards. Thefinancial statements fairly reflect the form and substance of transactions carried outduring the year under review and reasonably present your Company's financial condition andresults of operations.
Pursuant to Section 134 of the Act the Board of Directors to the best of itsknowledge and ability confirm that:
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures if any;
(b) appropriate accounting policies have been selected and applied consistently andhave made judgments and estimates that are reasonable and prudent so as to give a trueand fair view of the state of affairs of the Company as at March 31 2020 and of theprofit and loss of the Company for the year ended March 31 2020;
(c) proper and sufficient care has been taken for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
(d) the annual accounts have been prepared on a going concern basis;
(e) proper internal financial controls were laid down and followed by the Company andsuch internal financial controls are adequate and were operating effectively;
(f) proper systems are devised to ensure compliance with the provisions of allapplicable laws and that such systems are adequate and operating effectively.
Familiarization programme for Independent Directors
The Company keeps its Directors informed of the activities of the Company itsmanagement and operations and provides an overall industry perspective on issues beingfaced by the industry including changes in regulatory landscape in a proactive manner.Details of familiarization provided to the Directors of the Company are available on theCompany's website www.novartis.in.
Auditors and Auditors' Reports
During the year under review no frauds in terms of the provisions of section 143(12)of the Act have been reported by the statutory auditor and secretarial auditor in theirreport for the year under review.
(i) Statutory auditor
Pursuant to provisions of Section 139 of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014 M/s. Deloitte Haskins & Sells LLP
(Firm Registration No. 117366W/W-100018) were appointed as Statutory Auditors of theCompany for a term of five years to hold office from the conclusion of the 69thAnnual General Meeting till the conclusion of the 74th Annual General Meetingof the Company.
The requirement of seeking ratification of the members for continuance of StatutoryAuditors appointment has been withdrawn consequent to changes in the Companies (Amendment)Act 2017 w.e.f. May 7 2018. Hence the resolution seeking ratification of themembers for their appointment is not being placed at the ensuing Annual GeneralMeeting.
The Auditors' Report to the Members on the Accounts of the Company for the year endedMarch 31 2020 does not contain any qualification reservation or adverse remark. Duringthe year under review the Auditors had not reported any matter under Section 143(12) ofthe Act; therefore no detail is required to be disclosed under Section 134(3) (ca) of theAct.
Statutory Audit and other fees paid to Statutory Auditors:
During FY 2019-20 the total fees for the statutory audit rendered by the StatutoryAuditors are given below:
|(including Goods and Service tax where applicable) || || |
| ||2019-20 ||2018-19 |
|Audit Fees ||8.4 ||7.7 |
|Tax Audit Fees ||1.3 ||1.3 |
|Reimbursement of expenses ||0.3 ||0.3 |
|Total ||10.0 ||9.3 |
(ii) Secretarial Audit
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board has appointed Mr. K.G. Saraf from Saraf & Associates Practicing Company Secretary for conductingsecretarial audit of the Company for the Financial Year 2019-20.
The Secretarial Audit Report is annexed herewith as Annexure C. The SecretarialAudit
Report does not contain any qualification reservation or adverse remark.
Compliance with Secretarial Standards
During the Financial Year 2019-20 the Company has complied with the applicableSecretarial Standards issued by the Institute of Company Secretaries of India.
Annual Secretarial Compliance Report
The Company has undertaken an examination of all applicable compliances as per theSecurities and Exchange Board of India Regulations and Circulars/Guidelines issuedthereunder for the Financial Year 2019-20.
The Annual Secretarial Compliance Report as issued by the Practising Company Secretaryhas been submitted to the stock exchange within stipulated time. The Report does notcontain any adverse remark.
Energy Technology Absorption and Foreign Exchange
Information required under Section 134(3)(m) of the Act read with Rule 8(3) of theCompanies (Accounts) Rules 2014 with respect to conservation of energy technologyabsorption and foreign exchange earnings/outgo is included in
The Company is committed to follow best practices of corporate governance and is incompliance with the provisions on corporate governance specified in the SEBI ListingRegulations and Novartis Group corporate governance norms.
A certificate of compliance from Dr. K. R. Chandratre Practicing Company Secretary andthe report on Corporate Governance form part of this Directors' Report.
All necessary details as required under the Act and Rules made thereunder aredisclosed including in the Corporate Governance Report of this Annual Report.
Prevention of Sexual Harassment Policy
The Company has in place a Prevention of Sexual Harassment policy in line withthe requirements of the Sexual Harassment of Women at the Workplace (PreventionProhibition and Redressal) Act 2013. An Internal Committee has been set up to redresscomplaints received regarding sexual harassment. All persons whether employed aspermanent contractual temporary or trainees are covered under this policy.
During the Financial Year 2019-20 one complaint was received by the Company related tosexual harassment and the same was addressed.
Extract of Annual Return
Pursuant to the provisions of sections 92(3) and 134(3)(a) of the Act and the Companies(Management and Administration) Rules 2014 an extract of the annual return inForm no. MGT-9 is annexed as Annexure E to this Report and is also availableon the website of the Company i.e. www.novartis.in.
The Board appreciates and places on record the contribution made by all stakeholdersparticularly employees shareholders customers the medical fraternity and all businesspartners during the year under review and acknowledges the support received from theparent Company Novartis AG.
The statements forming part of the Directors' Report may contain certain forwardlooking remarks within the meaning of applicable securities laws and regulations. Manyfactors could cause the actual results performances or achievements of the Companyto be materially different from any future results performances or achievements that maybe expressed or implied by such forward looking statements.