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Parmax Pharma Ltd.

BSE: 540359 Sector: Health care
NSE: N.A. ISIN Code: INE240T01014
BSE 00:00 | 30 Nov 35.50 -0.40
(-1.11%)
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35.90

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36.80

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NSE 05:30 | 01 Jan Parmax Pharma Ltd
OPEN 35.90
PREVIOUS CLOSE 35.90
VOLUME 1001
52-Week high 70.90
52-Week low 26.35
P/E
Mkt Cap.(Rs cr) 13
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 35.90
CLOSE 35.90
VOLUME 1001
52-Week high 70.90
52-Week low 26.35
P/E
Mkt Cap.(Rs cr) 13
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Parmax Pharma Ltd. (PARMAXPHARMA) - Director Report

Company director report

Dear Shareholders

The Board of Directors are pleased to present their 28th Annual Report onthe business and operations of the Company and the Audited financial accounts for the Yearended 31st March 2022.

Financial Results:

(Rs. In lacs.)
Particulars For the year ended on 31st March 2022 For the year ended on 31st March 2021
Net Total Income 1831.39 2629.34
Less: Operating and Admin. Exps. 1607.85 2314.34
Profit before depreciation and Taxes 223.54 315.00
Less: Depreciation 193.21 194.16
Less: Extraordinary/Exceptional Items 0 0
Net Profit/(Loss) on sale of Fixed Assets 0 0
Profit before Tax (PBT) 30.33 120.84
Less: Taxes (including deferred tax and fringe benefit tax)
Profit after Tax (PAT) 14.32 75.44
Balance Available for appropriation 150.88 136.73
Which the Directors propose to appropriate as under:
(i) Proposed Dividend 0 0
(ii) Corporate Dividend Tax 0 0
Surplus Carried to Balance Sheet 30.32 75.44
Earnings Per Equity Share
Basic 0.38* 2.02*
Diluted 0.38* 2.02*

*- Amount of EPS is in Rs.

Highlights of Performance:

The company has posted a satisfactory performance for the year under review. The totalrevenue of the Company has decreased from Rs. Rs. 2629.34 lacs to Rs. 1831.39 lacs. Theprofit before tax of the Company has decreased from Rs. 120.84 lacs to Rs. 30.32 lacs. Andthe net profit after tax has also decreased from Rs. 75.44 lacs to Rs. 14.15 lacs. Weremained resolute and relentless in our quest for strengthening our cost-competivenessbetter management of working capital and operational excellence across all businesses.

Dividend:

Keeping in view the financial results and in order to conserve financial resources forthe future requirement of the fund your directors do not recommend any dividend duringthe year under review

Public Deposits:

The Company had accepted deposits of Rs. 25 Lakh from Relative of Directors andPromoters and hence the directives issued by the Reserve Bank of India and the provisionsof Sections 73 to 76 or any other relevant provisions of the Act and the Companies(Acceptance of Deposit) Rules 2015 with regard to the deposits accepted from the relativeof Director contravenes.

Subsidiary/ Joint Venture/ Associate Company:

As on 31st March 2022 Your Company has Nil Subsidiary/Joint Venture/Associate Company.

INTERNAL CONTROL SYSTEMS

Your Company has a robust system of internal controls commensurate with the size of theCompany and the nature of its business which ensures that transactions are recordedauthorised and reported correctly apart from safeguarding its assets against loss fromwastage unauthorised use and disposition. The internal control systems are supplementedby well documented policies guidelines and procedures which are in line with the internalfinancial control framework requirements. There is an extensive programme of internalaudit by a firm of chartered accountants followed by periodic management reviews.

The Audit Committee actively reviews the adequacy and effectiveness of the internalcontrol systems and suggests improvements to strengthen the same.

RISK MANAGEMENT

Your Company considers that risk is an integral part of its business and therefore ittakes proper steps to manage all risks in a proactive and efficient manner. The Companymanagement periodically assesses risks in the internal and external environment andincorporates suitable risk treatment processes in its strategy and business and operatingplans. The details of practices being followed by the Company in this regard form part ofthe Corporate Governance Report. There are no risks which in the opinion of the Boardthreaten the very existence of your Company. However some of the challenges faced by ithave been dealt with under Management Discussion and Analysis which forms part of thisReport.

Depository System:

As members are aware the company's shares are compulsorily tradable in the electronicform. As on March 31 2022 almost 70.36% of the Company's total paid-up capitalrepresenting 2632670 shares were in dematerialized form. In view of the numerousadvantages offered by the Depository system members holding shares in physical mode areadvised to avail of the facility of dematerialization on either of the Depositories.

BOARD MEETINGS HELD DURING THE YEAR:

Sr. No. Date on which board Meetings were held Total Strength of the Board No. of Directors Present
1 26.04.2021 4 4
2 11.05.2021 4 4
3 29.06.2021 4 4
4 29.07.2021 4 4
5 14.08.2021 4 4
6 13.11.2021 3 3
7 14.02.2022 3 3

Attendance of Directors at Board Meetings:

Sr. No. Name of Directors No. of Meeting entitled to attend No. of Meeting Attended
1. Dr. Umang Gosalia 7 7
2. Mrs. Asha Daftary 5 5
3. Mr. Pramay Chhatra 7 7
4. Ms. Ami Shah 7 7

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

> In terms of Section 152 of the Companies Act 2013 Mr. Umang Alkesh Gosalia (DIN:005173830) is liable to retire by rotation at forthcoming AGM and being eligible offershimself for re-appointment.

> A brief resume of director being re-appointed with the nature of their expertisetheir shareholding in the Company as stipulated under as required under Regulation 36(3)of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 is annexed tothis Notice of the ensuing Annual General Meeting.

> The Company has received necessary declaration from each independent directorunder Section 149(7) of the Companies Act 2013 that he/she meets the criteria ofindependence laid down in Section 149(6) of the Companies Act 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

> All the directors of the Company have confirmed that they are not disqualifiedfrom being appointed as directors in terms of Section 164 of the Companies Act 2013.

MATTERS AS PRESCRIBED UNDER SUB-SECTIONS (1) AND (3) OF SECTION 178 OF THE COMPANIESACT 2013:

The policy of the Company on directors' appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a directorand other matters provided under Sub section (3) of Section 178 of the Companies Act2013 adopted by the Committee is appended in the Corporate Governance Report.

EXTRACT OF ANNUAL RETURN AS PER SECTION 92 (3) OF COMPANIES ACT 2013:

The Annual Return as required under Section 92 and Section 134 of the Companies Act2013 read with Rule 12 of the Companies (Management and Administration) Rules 2014 isavailable on the website of the Company and the web-link for the same ishttps://www.parmaxpharma.com/investor relations.php

KEY FINANCIAL RATIOS:

Key Financial Ratios for the financial year 2021-22 with comparatives for the year2020-21 are disclosed in Financial Statements.

BOARD EVALUATION:

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual evaluation of its own performance the directors individually as well as theevaluation of the working of its Committees. At the meeting of the Board all the relevantfactors that are material for evaluating the performance of individual Directors theBoard and its various committees were discussed in detail. A structured questionnaire eachfor evaluation of the Board its various Committees and individual Directors was preparedand recommended to the Board by Nomination & Remuneration Committee for doing therequired evaluation after taking into consideration the input received from the Directorscovering various aspects of the Board's functioning such as adequacy of the composition ofthe Board and its Committees execution and performance of specific duties obligationsand governance etc.

AUDITORS:

> Statutory Auditors

Company had appointed M/s B.A. Shah S.R. Mehta & Co. Chartered Accountants for thepurpose of carrying out Statutory Audit of the Company.

> Secretarial Auditor

Mr. Samsad Alam Khan Practicing Company Secretaries is re-appointed to conduct thesecretarial audit of the Company for the financial year 2021-22 as required under Section204 of the Companies Act 2013 and Rules thereunder. Your Company has received consentfrom Mr. Samsad Alam Khan to act as the auditor for conducting audit of the Secretarialrecords for the financial year ending 31st March 2023. The secretarial audit report forFY 2021-22 forms part of the Annual Report as 'Annexure B' to the Board's report.

Directors Response to Secretarial Audit Report and Audit Report:-

Your Board of Directors would like to clarify the qualification remarks made inSecretarial Audit Report as under:-

Qualification/ Adverse Remark Explanation :
1. Company has not complied with the provisions of Section 74 of the Companies Act 2013 regarding acceptance of deposits. 1. The Board is in process of complying with Section 74 of Companies Act 2013 regarding Acceptance of deposits.
However Board assures to comply with the Act and Regulations.

Directors Response to Statutory Audit Report:-

Qualification/ Adverse Remark Explanation :
The Company has accepted deposits of Rs. 25 Lakh from Relative of Directors and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules 2015 with regard to the deposits accepted from the relative of Director is contravening. The Board is in process of complying with Section 74 of Companies Act 2013 regarding Acceptance of deposits.
Company has not maintained the Fixed Asset Register Company Management is in process of maintaining Fixed Asset Register.

• Internal Auditors:

The Board appointed M/s. B A Shah & Associates. Chartered Accountants (FirmRegistration Number:- 109493W) hereby appointed as Internal Auditor of the company for thefinancial year 2021-22. The report prepared by the Internal Auditors is to be reviewed bythe Statutory Auditors & Audit Committee.

• Internal Financial Control System and their Adequacy:

The details in respect of internal financial control and their adequacy are included inthe Management Discussion & Analysis Report which forms part of this report.

• Particulars of Loans Guarantees or Investments under Section 186:

Details of Loans Guarantees and Investments under the provisions of Section 186 of theCompanies Act 2013 are not applicable to the Company.

• Audit Committee:

The composition and the functions of the Audit Committee of the Board of Directors ofthe Company is disclosed in the Report on Corporate Governance which is forming a part ofthis report.

• Related Party Transactions:

All the related party transactions entered into during the financial year were on anarm's length basis and were in the ordinary course of business. Accordingly thedisclosure of related party transactions as required under Section 134(3) (h) of theCompanies Act 2013 in Form AOC 2 is attached in "Annexure C".

• Significant and Material Orders passed by the Regulators or Courts:

There is no proceeding pending under the Insolvency and Bankruptcy Code 2016. Therewas no instance of onetime settlement with any Bank or Financial Institution.

• Policy against Sexual Harassment at Workplace

The Company values the dignity of individuals and is committed to provide anenvironment which is free of discrimination intimidation and abuse. The Company has putin place a policy on redressal of Sexual Harassment and a Policy on redressal of WorkplaceHarassment as per the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 ("Sexual Harassment Act"). As per the policy any employeemay report his/ her complaint to the Redressal Committee formed for this purpose or theirManager or HR personnel. The company has also constituted an Internal Complaints Committeeto inquire into complaints of sexual harassment and recommendation for appropriate action.No complaints have been filed/ disposed of/ pending during the financial year ended 31stMarch 2022.

• Material changes:

There are no material changes and commitments that would affect financial position ofthe company from the end of the financial year of the company to which the financialstatements relate and the date of the directors report.

• Reserves:

The Company has proposed to transfer Rs.1415132/- profit of the Company to theGeneral Reserve for this year.

• Employee Stock Option:

The Company has not issued any Employee Stock Option.

• Cash Flow analysis:

The Cash Flow Statement for the year under reference in terms of Regulation 34(2) (c)of the SEBI (Listing Obligations And Disclosure Requirements) Regulations 2015 with thestock exchanges forms part of the Annual Report.

• Conservation of energy research and development technology absorption foreignexchange earnings and outgo:

A) Conservation of Energy:

Your company is serious in conserving energy by reducing consumption of power byimplementing closed monitoring over plan running and adequate maintenance of electriccomponents of plants and other machinery.

In FY 2021-22 the Company has initiated the installed the made any capital investmentor not taken any other steps for conservation of energy or the clause is not applicable.

B) Technology absorption:

Your company has not made any efforts towards technology absorption and neitherimported any technology nor made any expenditure on research and developments.

C) Foreign Exchange earnings and outgo:

Foreign Exchange inflow (Rs.): 13133

Foreign Exchange outflow (Rs.): NIL

• Corporate Governance:

The Company is committed to maximise the value for its stakeholders by adopting theprinciples of good Corporate Governance in line with the provisions of law andparticularly those stipulated in the Listing Regulations. Its objective and that of itsmanagement and employees is to manufacture and market the Company's products in a way soas to create value that can be sustained over the long term for consumers shareholdersemployees business partners and the national economy in general.

Certificate from the auditors of the Company regarding compliance of the conditions ofCorporate Governance as stipulated in the Listing Regulations is enclosed.

MANAGEMENT DISCUSSION AND ANALYSIS:

Economic Scenario:

Indian pharmaceuticals value added output is forecast to grow more than 6% annually in2022 and in 2023 due to the ongoing rollout of Covid-19 vaccinations a rebound innon-Covid related medical treatments and a surge in generic drug exports. However in H1of 2022 drug producers still face pressure on gross margins due to high commodity andtransport costs. Domestic wholesalers and pharmacies continue to generate low but stablemargins.

While generic drugs still account for about 70% of output the pandemic has spurredIndian drug producers to substantially increase their R&D spending. Due to a serioussupply disruption in 2020 Indian drug producers intend to increase local production ofActive Pharmaceutical Ingredients (APIs) in order to reduce their reliance on Chinesedeliveries. Those imports have meanwhile rebounded but are not yet back to pre-pandemiclevels. The government has announced a large incentive scheme (e.g. with tax exemptions)to boost local API production which will last until 2030.

We expect the domestic drug market to grow steadily in the coming years due todemographic trends and rising household income. The growing middle class can increasinglyafford high quality drugs while demand for treatments (and related drugs) ofcardiovascular diseases and other chronic diseases will increase.

The balance sheets of most Indian pharmaceutical businesses and their capacity togenerate cash are strong. Both gearing and dependence on bank finance are low. Paymentbehaviour has been good over the past two years and we expect the number of protractedpayments and business failures to remain low in 2022. Given the benign credit risksituation of most businesses and good growth prospects in the coming years ourunderwriting stance is open for all segments.

This Management Discussion and Analysis statement of the Annual Report has beenincluded in adherence to the spirit enunciated in the code of corporate governanceapproved by the Securities and Exchange Board of India. Statement in the ManagementDiscussion and Analysis describing Company's objectives projections estimatesexpectation may be forward-looking statements within the meaning of applicable securitieslaws and regulations. Actual result could differ materially from those expressed orimplied. Important factors that could make a difference to the Company's operation includeeconomic conditions affecting demand/supply and price conditions in the Governmentregulations tax laws and other status and other incidental factors. Further thediscussion following herein reflects the perceptions on major issues as on date and theopinion expressed here are subject to change without notice. The Company undertakes noobligations to publicly update or revise any of the opinions of forward looking statementsexpressed in this report consequent to new information future events or otherwise.

Readers are hence cautioned not to place undue reliance on these statements and areadvised to conduct their own investigation and analysis of the information contained orreferred to this statement before taking any action with regard to specific objectives.

RISK MANAGEMENT:

A. Risk Management Committee

The Company has not constituted any risk management committee. However the Board as andwhen required reviews the Risk Management Policy.

B. Major risks affecting the existence of the company

Business Risk

• Operating Environment

• Ownership Structure

• Competitive position

• Management Systems and Strategy governance structure

Financial Risk

• Asset Quality

• Liquidity

• Profitability

• Capital Adequacy

C. Steps taken to mitigate the risks:

Company has framed formal risk management policy. However Board of directors areconstantly trying to avoid the risks by way of planning developing strategies to remainin the market reviewing government policies and procedures and doing marketingactivities to remain in the market.

CORPORATE SOCIAL RESPONSIBILITY:

This clause is not applicable.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability state the following:

> That in the preparation of the annual financial statements for the year endedMarch 31 2022 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;

> That such accounting policies as mentioned in Notes to the Financial Statementshave been selected and applied consistently and judgement and estimates have been madethat are reasonable and prudent so as to give a true and fair view of the state of affairsof the Company as at 31st March 2022 and of the profit of the Company for theyear ended on that date;

> That 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;

> That the annual financial statements have been prepared on a going concern basis.

> That proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.

> That systems to ensure compliance with the provisions of all applicable laws werein place and were adequate and operating effectively.

KEY MANAGERIAL PERSONNEL:

As at end of the year Dr. Umang Gosalia Managing Director Mr. Keyur D Vora ChiefFinancial Officer and CS Yash Vora Company Secretary were the Key Managerial Personnel ofthe Company.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

Your Company is committed to highest standards of ethical moral and legal businessconduct. Accordingly the Board of Directors have formulated a Whistle Blower Policy whichis in compliance with the provisions of Section 177(10) of the Companies Act 2013 andRegulation 22 of the SEBI (LODR) Regulations 2015. It is framed for employees andDirectors of the company to report to the management instances of unethical behaviouractual or suspected fraud or violation of the company's code of conduct. This policyenables the employees or directors of Company to approach the Chairman of Audit Committee.

Further the whistle blower policy is available at the website of our company athttp://www.parmaxpharma.com/policies.php

THE CHANGE IN NATURE OF BUSINESS:

There is no material change in the business of the Company during the year underreview.

PARTICULARS OF EMPLOYEES:

A statement containing the names and other particulars of employees in accordance withthe provisions of section 197(12) of the Companies Act 2013 read with rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is appendedas "Annexure - D" to this report.

No employee has received remuneration in excess of the limits set out in rules 5(2) and5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014during FY 2021-22.

ACKNOWLEDGMENT:

The Directors wish to place on record their appreciation to the devoted services of theworkers staff and the officers who largely contributed to the efficient management of theCompany in the difficult times. The Directors place on record their appreciation for thecontinued support of the shareholders of the Company. The Directors also take thisopportunity to express their grateful appreciation for assistance and cooperation receivedfrom the bankers vendors and stakeholders including financial institutions Central andState Government authorities other business associates who have extended their valuablesustained support and encouragement during the year under review.

By and order of Board Of Directors
For Parmax Pharma Limited
Date: 12th August 2022 Dr. Umang Gosalia
Place: Rajkot Managing Director
DIN:05153830

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