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Samrat Pharmachem Ltd.

BSE: 530125 Sector: Health care
NSE: N.A. ISIN Code: INE103E01016
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NSE 05:30 | 01 Jan Samrat Pharmachem Ltd
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VOLUME 20
52-Week high 170.40
52-Week low 49.00
P/E 12.49
Mkt Cap.(Rs cr) 40
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Sell Price 0.00
Sell Qty 0.00
OPEN 130.00
CLOSE 130.00
VOLUME 20
52-Week high 170.40
52-Week low 49.00
P/E 12.49
Mkt Cap.(Rs cr) 40
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Samrat Pharmachem Ltd. (SAMRATPHARMA) - Director Report

Company director report

To

The Members

Samrat Pharmachem Limited

The Directors are pleased to present the 25th Annual Report on the business andoperations of the company and the financial accounts for the year ended 31 March 2017

FINANCIAL PERFORMANCE

Particulars 31 March 2017 31 March 2016
Rs. Rs.
Turnover 710650378 618551697
Profit before tax (PBT) 24933322 4487188
Provision for tax -10094608 -1488304
Other tax adjustments -376539 -12000
Net Deferred Tax Liability for current year 1193562 26274
Profit after tax (PAT) 15655737 3013158
Profit & Loss account
Opening Balance 106663951 103650793
Profit of the current year after tax 15655737 3013158
Balance carried forward to Balance Sheet 122319688 106663951

OPERATIONS

Your company has performed reasonably well during the year. In a highlycompetitive business environment your Company achieved a turnover of Rs. 7106.50 Lakhs asagainst Rs. 6185.51 Lakhs achieved last year - an increase of around 14.89%. Production of514.07 tons of pharmaceutical chemicals was achieved during the year.

DIVIDEND

In order to conserve the resources your Directors do not recommend payment of Dividendfor the financial year ended 31st March 2017.

EXPORTS

During the year 2016-17 your company's export division registered FOB sales of Rs.1034.48 Lacs from Rs. 1179.83 Lacs acheived last year. Your Company has initiated severalexport promotion measures to increase exports. The products of your Company have been wellaccepted in the international market and the Company expects better export turnover in thecoming years.

DEMATERIALISATION

The equity shares of the Company have been dematerialized by joining the depositoriesviz. National Securities Depository Limited (NSDL) & Central Depository Services(India) Limited (CDSL). The ISIN (International Securities Identification Number) No.allotted to the Company is INE103E01016.

LISTING OF SHARES

The Company's shares are listed on the Bombay Stock Exchange Ltd. It has paid thelisting fees of BSE Limited for the period upto 31st March 2018. Your Company has notbeen delisted on this exchange for non-payment of listing fees.

INSURANCE

The assets of the company have been adequately insured against all possible risks withICICI Lombard General Insurance Co Ltd & United India Insurance Co. Ltd.

WEBSITE

Your company's website address is www.samratpharmachem.com. The performance of theCompany is regularly updated and made available on this website. The website providesother vital information about the Company.

SAFETY HEALTH & ENVIRONMENT (SHE) POLICY

As a responsible corporate citizen the Company is fully aware of its responsibilitiesfor protection of the environment and to provide its employees a safe and hazard free workplace. The Company has adopted a Safety Health & Environment Policy that applies toall employees and activities. The work culture encourages total involvement and commitmentof the employees to the SHE Policy.

Some of the activities carried out during the year are as follows.

Safety:

Providing necessary equipments and apparatus required for the safe operation of themanufacturing activities

Observing the rules and regulations with regard to safety & precaution

Consulting emergency control management team to monitor the safety of the plant

Conducting regular safety audit

Encouraging the workforce to use protective equipments and maintain cleanliness

Conducting seminars to impart knowledge to employees on safe operations

Organising safety week to create safety awareness Health:

• Conducting medical health check up for all the employees of the Companyperiodically

• Conducting lecture meetings for providing guidance and counselling on matters ofhealth diet and exercise

• Conducting seminars to impart knowledge on meditation yoga and anti-stresstherapy

Environment:

Ensuring smooth functioning of the effluent treatment plant with respect to air waterand solid waste.

Updating the ETP plant to make it more nature friendly

Proper monitoring of the pollution levels in and around the plants

Planting trees in and around the factory

Complying with the prescribed norms of pollution control

PERSONNEL

As on 31st March 2017 the total number of employees on the payroll of thecompany were 30. Industrial relations with employees at various levels continue to becordial.

DIRECTORS & KEY MANAGERIAL PERSONNEL

In pursuance to the provisions of the Companies Act 2013 and Articles of Associationof the company Mr. Megh Mehta Director retires by rotation and being eligible has offeredhimself for re-appointment.

During the year Mr. Lalit Mehta Mr. Rajesh Mehta and Mr. Megh Mehta were re-appointedas Executive Directors for a period of 3 years from 1st April 2017 to 31st March 2020subject to approval of members at the ensuing Annual General Meeting of the Company.

The company has received declaration from all the independent directors confirming thatthey meet the criteria of independence as prescribed under section 149(6) of the CompaniesAct 2013.

The company has devised a policy for the performance evaluation of independentdirectors Board committees and other individual directors which include criteria forperformance evaluation of non-executive directors and executive directors. The manner inwhich the evaluation is carried out has been explained in the Corporate Governance Report.

SUBSIDIARIES JOINT VENTURES OR ASSOCIATE COMPANIES

Your company has no subsidiaries joint ventures or any associate companies during theyear.

MEETING OF THE BOARD

During the year under review seven (7) Board Meetings were held. The intervening gapbetween the meetings was within the period prescribed under the Companies Act 2013. Forfurther details please refer to the Corporate Governance Report attached to this AnnualReport.

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee comprises of the 3 Directors namely Mr.Samir Kothary (Chairman) and Mr. Mahendra Pipalia and Ms. Renu Dharod as other members ofthe committee.

This committee recommends and reviews the appointment and remuneration of Directors. Ithas adopted a policy which deals with the appointment and remuneration of directors andkey managerial personnel. The adopted policy decides about the manner of selection ofexecutive directors key managerial personnel and independent directors. The policy alsodecides about the criteria to be followed for recommending the remuneration of directorsand key managerial personnel.

BOARD EVALUATION

The Board of Directors have carried out an annual evaluation of its own performanceBoard Committees and individual directors pursuant to the provision of Act and theCorporate Governance requirement as prescribed by Securities and Exchange Board of India(SEBI) (Listing Obligations and Disclosure Requirements) Regulations 2015 ("SEBIListing Regulations"). The performance of Board was evaluated by the Board ofDirectors after seeking inputs from all directors on the basis of criteria such as BoardComposition & Structure Effectiveness of Board Process Information and functioningetc.

In separate meeting of Independent directors' performance of Non-Independent Directorsperformance of the Board as whole and performance of Chairman was evaluated taking intoaccount the views of executive directors and non-executive directors.

POLICIES

We seek to promote and follow the highest level of ethical standards in all ourbusiness transactions guided by our value system. The SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 mandated the formulation of certain policiesfor all listed companies. All our corporate governance policies are available on ourwebsite (www.samratpharmachem.com). These policies are reviewed periodically by the Boardand updated based on need and new compliance requirement.

Policies adopted by the Company:

Name of the policy Web link
Archival Policy http://www.samratpharmachem.com/archival-policy/
Appointment of Independent Directors Policy http://www.samratpharmachem.com/independent-director- terms-and-conditions-of-appointment/
Related Party Transactions & its Materiality Policy http://www.samratpharmachem.com/policy-on-related-party- transactions-and-its-materiality/
Whistle-blower Policy http://www.samratpharmachem.com/whistleblower-policy/
Materiality of Events Policy http://www.samratpharmachem.com/policies/materiality-of- events-policy/
Preservation of Documents Policy http://www.samratpharmachem.com/policy-on-preservation-of- documents/
Insider Trading Policy http://www.samratpharmachem.com/insider-trading- policy/
Privacy Policy http://www.samratpharmachem.com/policies/privacy-policy/
Quality Policy http://www.samratpharmachem.com/quality-policy-2/
SHE Policy http://www.samratpharmachem.com/policies/she-policy/
Corporate Social Policy http://www.samratpharmachem.com/policies/corporate-social- policy/

REMUNERATION RATIO OF THE DIRECTORS / KEY MANAGERIAL PERSONNEL (KMP) / EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 are givenbelow:

Name & Designation Remuneration Remuneration Increase in remuneration from previous year Ratio/Times per Median of employee remuneration
Paid FY Paid FY
2016-17 2015-16
1 Mr. Lalit Mehta CMD 1500000 1500000 0 10.73
2 Mr. Rajesh Mehta ED 1440000 1440000 0 10.30
3 Mr. Megh Mehta ED 420000 210000 210000 3.01

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors reportthat: -

1. That the preparation of accounts for the Financial Year ended 31st March 2017 theapplicable accounting standards read with requirements set out under Schedule III of theAct have been followed along-with proper explanation relating to material departures;

2. That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive true and fair view of the state of affairs of the Company at the end of the FinancialYear and the Profit or Loss of the Company for the year on that date;

3. That the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

4. That the Directors' have prepared the accounts for the financial year ended 31stMarch 2017 on a going concern basis.

5. That the Directors have laid down internal financial control to be followed by thecompany and that such internal financial controls are adequate and are operatingeffectively; and

6. That the Directors have devised proper systems to ensure compliance with theprovisions of all applicable laws and that such system are adequate and operatingeffectively

Based on the framework of internal financial controls and compliance systemsestablished and maintained by the Company work performed by the internal statutory andsecretarial auditors and external consultants and the reviews performed by the managementand the relevant board committees including the audit committee the Board is of theopinion that the company's internal financial controls were adequate and effective duringthe financial year 2016-17.

MANAGEMENT DISCUSSION & ANALYSIS REPORT

As required under regulation 34 of SEBI (Listing Obligations and DisclosuresRequirements) Regulations 2015 the Management Discussion and Analysis Report is enclosedas a part of this report.

CORPORATE GOVERNANCE & SHAREHOLDERS INFORMATION

Pursuant to Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements)

Regulations 2015 ("SEBI Listing Regulations") the Company has executed freshListing Agreement with the Stock

Exchanges. Though the regulation nos. 17 to 27 of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 are not applicable to the Company due to itspaid up capital & net worth remain below threshold limit yet the company has providedcorporate governance report voluntarily as a good corporate practice.

SEXUAL HARASSMENT OF WOMEN AT WORK PLACE

During the year under review there were no cases reported pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

AUDIT COMMITTEE

The Audit committee comprises 3 Directors namely

Mr. Mahendra Pipalia (Chairman)

Mr. Samir Kothary (Member) &

Ms. Renu Dharod (Member).

All the recommendations made by the Audit Committee was accepted by the Board.

AUDITORS

M/s. Shah & Savla LLP Chartered Accountants who are the Statutory Auditors of theCompany to hold office till the conclusion of 29th AGM to be held in the Calender Year2021 are eligible for re-appointment. Pursuant to the provisions of Section 139 of theCompanies Act 2013 and the Rules framed thereunder it is proposed to ratify appointmentof M/s. Shah & Savla LLP as statutory auditors of the Company for the Financial year2017-18.

AUDITORS REPORT

The report of auditors is self explanatory and do not require any further elucidation.

SECRETARIAL AUDITOR

Pursuant to provisions of Section 204 of the Companies Act 2013 and The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the company hasappointed M/s. A. A. Mulla & Associates a firm of company Secretaries in practice toundertake the Secretarial Audit of the Company for the financial year 2016-17. TheSecretarial Audit Report submitted by the Secretarial Auditor is enclosed herewith as apart of this report and shown as Annexure I.

RELATED PARTY TRANSACTION / DISCLOSURE

There are no related party transactions made by the company during the year. AOC-2report is attached to this report as Annexure II.

EXTRACT OF ANNUAL RETURN

As provided under Section 92(3) of the Act the extract of annual report is given inthe Annexure III in the prescribed Form MGT-9 which forms part of this report.

LOANS GUARANTEES AND INVESTMENTS

Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Companies Act 2013 are given in the notes to the Financial Statements.

PARTICULARS OF EMPLOYEES

Under the provision of Section 197(12) of the Companies Act 2013 read with Rule 5(2)and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) 1956read with Companies (Particulars of Employees) Rules 2014 the particulars of theemployees as required to be mentioned in the Annual Report is not applicable to thecompany.

SHARES ISSUED UNDER EMPLOYEE STOCK OPTION SCHEME (ESOS)

No shares have been issued to the employees under Employee Stock Option Scheme (ESOS)during the year.

PUBLIC DEPOSITS

The Company has not invited and accepted deposits from the public during the financialyear ended 31st March 2017.

DISCLOSURE OF PARTICULARS RELATING TO CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION& FOREIGN EXCHANGE EARNING & OUTGO

The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed pursuant to the provisions ofSection 134 of the Act read with Rule 8 of the Companies (Accounts Rules) 2014 is givenhereunder.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

Your Company continues to explore & implement measures that will help inconservation and saving of energy.

Measures taken & benefits derived are as follows:

Hot water coming from steam traps is recycled & used as boiler feed water.

Using economiser effectively to pre-heat boiler feed water.

Timely & routine preventive maintenance of boiler.

Improvement in unit operations leading to reduction in processing time in reactorcentrifuge drier & other equipments to minimize use of electricity.

Hot water coming from steam traps is recycled & used as boiler feed water.

TECHNOLOGY ABSORPTION

The management has focused on productivity and quality improvement in order to optimizemanufacturing costs. This has helped in achieving optimum manufacturing costs improvedquality of products and consequently enhanced customer satisfaction. The company usesindigenous technology.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Foreign exchange earned Rs. 103448091
F.O.B. Value of export of finished goods
(Previous year Rs. 117983540)
Foreign exchange used Rs. 588103620
Import of raw materials
(Previous year Rs. 509754052)

ACKNOWLEDGEMENTS

The Directors wish to place on record their appreciation towards all associatesincluding customers suppliers financial institutions bankers employees consultantsshareholders and to all those who have extended their committed support to the progress ofthe Company.

By order of the Board of Directors
For Samrat Pharmachem Limited
Place : Mumbai
Date : 30 May 2017
Lalit Mehta
Chairman & Managing Director
DIN : 00216681