The Members Phaarmasia Limited
Your Directors have pleasure in presenting the 38th Annual Report together with and theAudited Statement of Accounts for the year ended 31st March 2019.
1. Financial summary or highlights/Performance of the Company
The performance during the period ended 31st March 2019 has been as under:
(Rs. In Lakhs)
|Particulars ||31st March 2019 ||31st March 2018 |
|Sales & Other Income ||2625.90 ||2193.65 |
|Operating profit before Financial Charges & Depreciation ||132.95 ||118.73 |
|Financial Charges ||3.68 ||4.22 |
|Profit before Depreciation ||129.27 ||114.51 |
|Depreciation ||46.16 ||46.57 |
|Profit / (Loss) before taxes ||83.11 ||67.94 |
|Prior Period Expenses ||0.00 ||0.00 |
|Provision for Taxation of Current Year ||25.23 ||17.11 |
|Deferred Tax for the Current Year ||(19.87) ||(6.45) |
|Net profit after taxes ||77.74 ||57.28 |
|Other comprehensive income ||1.65 ||(20.80) |
|Dividend (including tax on Dividend) ||0.00 ||0.00 |
|Balance of profit brought forward ||79.39 ||36.48 |
2. BRIEF DESCRIPTION OF THE COMPANY'S WORKING DURING THE YEAR/STATE OF COMPANY'SAFFAIRS:
During the year under review the gross revenue of the Company increased to Rs.2625.90 Lakhs as compared to Rs. 2193.65 Lakhs in the previous year. Profitafter tax for the year increased to Rs. 77.74 Lakhs as compared to Rs. 57.28Lakhs in the previous year.
3. SEBI GUIDELINES FOR STRENGTHENING AND RAISING INDUSTRY STANDARDS
SEBI Circular No. SEBIHO / MIRSDIDOP1/CIR/P/2018/73 dated 20.04.2018 with regards toStrengthening the Guidelines and Raising Industry standards for RTA Issuer Companies andBanker to an Issue to issue the Intimation letter to the Shareholders of the Companycalling for their bank mandate by way of cancelled cheque along with PAN and otherdetails. Necessary intimation in this regards for shareholder is enclosed herewith.
4. FUTURE OUTLOOK:
Continuing positively from the FY 2018-19 The Company is expecting consolidate itstrength and develop a state of art manufacturing facility and expand its productssegments and widening of its domestic market segments in the narrow future we expectsteady and continuous growth in the financial years ahead.
5. SHARE CAPITAL:
The authorised capital of the company stand unchanged from previous year at Rs.100000000/- (Rupees Ten Crores) the Issued Subscribed and Paid up Capital of theCompany as on March 31 2019 is Rs. 68269600/- (Rupees Six Crores Eighty Two LakhsSixty Nine Thousand and Six Hundred) divided into 6826960 equity shares of Rs.10/-(Rupees Ten) each.
The company has not declared the dividend during the financial year under review.
7. TRANSFERS TO RESERVES:
No Profits during the year were transferred to Reserves during the financial year2018-19. However profit for the year forms part of surplus.
The Company confirms that it has paid the Annual Listing Fees for the year 2018-2019 toBSE where the Company's Shares are listed.
9. MEETING OF THE BOARD:
The Board of Directors duly met 5 (Five) times on 30-05-2018 18-07-2018 14-08-201814-11-2018 and 14-02-2019 in respect of which meetings proper notices were given and theproceedings were properly recorded and signed in the Minutes Book maintained for thepurpose.
The intervening gap between the Meetings was not more than 120 days as prescribed underthe Companies Act 2013.
10. DIRECTORS AND KEY MANAGERIAL PERSONNEL.
Mr. Vinay R. Sapte Director retires by rotation at the forthcoming Annual GeneralMeeting and being eligible offer himself for reappointment.
Mr. Ajit G. Jamkhandikar was appointed as the Additional Director by the Board ofDirector of the Company w.e.f from 14.08.2018. The Board of Directors of the Company inconsultation of committees of Board of the Company recommends for regularization ofAppointment of Mr. Ajit Jamkhandikar as Independent Director of the Company for period of5 year.
The Board of Directors of the company ("the Board)") at its meeting held onAugust 14 2019 based upon recommendation of nomination and remuneration committedsubject to approval of members reappointed Mr. Yallapragada Naga Bhaskara Rao (DIN:00019052) as a whole Time Director for a further period of 5 (Five) years from the expiryof his present term that is August 14 2019.
11. DIRECTORS RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 134(5) OF THECOMPANIES ACT 2013:
In compliance of section 134 (5) of the Companies Act 2013 your directors confirm:
a) That in the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanation relating to material departures;
b) That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit or loss of the company for the year under review;
c) 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;
d) The directors have prepared the annual accounts on a going concern basis;
e) that the Directors had laid down internal financial controls to be followed by thecompany and that such internal financial control to be followed by the company areadequate and were operating effectively.
f) that the Directors has devised proper systems to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingeffectively.
12. DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
The Company has received necessary declarations from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 that the Independent Directors ofthe Company meet the criteria of their independence as laid down in Section 149(6) of theCompanies Act 2013.
13. PARTICULARS OF EMPLOYEES:
The information required pursuant to Section 197 read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is as under. Further there were no employees who were drawing salary ofmore than INR 8.5 Lakhs per month or INR 102 Lakhs per annum.
a. The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year:
|Executive Directors ||Ratio to Median remuneration |
|Yallapragada Naga Bhaskara Rao ||9.7:1 |
|Maneesh Ramakant Sapte ||Nil |
|Other Directors ||Nil |
b. The percentage increase in remuneration of each directors Chief Executive OfficerChief Financial Officer Company Secretary in the financial year:
|Directors CEO CFO and Company Secretary ||% increase in Remuneration in the Financial Year. |
|Maneesh Ramakant Sapte ||Nil |
|Y.N. Bhaskara Rao ||20% |
|Vinay Ramakant Sapte ||Nil |
|Rashmi Vinay Sapte ||Nil |
|Ajit Jamkhandikar ||Nil |
|Pravin Hegde ||Nil |
|N.E.V. Prasad Rao ||10% |
|Abhishek Wakchaure ||Nil |
c. The percentage increase in the median remuneration of employees in the financialyear: 10 %
d. The number of permanent employees on the rolls of Company 26 Employees
e. Variations in the market capitalization of the Company price earnings ratio as atthe closing date of the current financial year and previous financial year and percentageincrease over decrease in the market quotations of the shares of the Company in comparisonto the rate at which the Company came out with the last public offer in case of listedcompanies and in case of unlisted companies the variations in the net worth of theCompany as at the close of the current financial year and previous financial year.
|Sr. No ||Particular ||As at March 31 2019 ||As at March 31 2018 |
|1. ||Market Capitalization ||115034276 ||250890780 |
|2. ||Price Earnings Ratio ||14.78:1 ||43.75 : 1 |
f. Average percentile increase already made in the salaries of employees other than themanagerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration:
Average percentile increase in the salaries of the employees other than the managerialpersonnel in the last financial year is 10%
g. Directors hereby affirm that the remuneration is as per the remuneration policy ofthe company.
14. POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION:
The Company has framed policy on Directors' appointment and remuneration and othermatters provided in section 178(3) of the Act and is referred to while taking decisionsunder its purview.
15. BOARD EVALUATION
The Board of Directors of the Company carried out the Annual evaluation of its ownperformance board committees and individual directors pursuant to the provisions of theapplicable Act rules and guidelines.
The performance of the Board was evaluated by the Board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The Board and the Nomination and Remuneration committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings like preparedness on the issues tobe discussed meaningful and constructive contribution and inputs in meetings etc. Inaddition the chairman was also evaluated on the key aspects of his role.
In a separate meeting of independent directors performance of non-independentdirectors performance of the Board as a whole and performance of the chairman wasevaluated taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting of theindependent directors at which the performance of the Board its committees andindividual directors was also discussed. Performance evaluation of independent directorswas done by the entire board excluding the independent director being evaluated.
The overall performance of the Chairman Executive Directors and Non-ExecutiveDirectors of the company is satisfactory. The review of performance was based on thecriteria of performance knowledge analysis quality of decision making etc.
16. MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY WHICH HAVE OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR OF THE COMPANY TO WHICHTHE FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORT
There are no material changes and commitments affecting the financial position of theCompany which have occurred between the End of the Financial Year and the date of thereport.
17. EXTRACT OF ANNUAL RETURN
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) ofCompanies (Management and Administration) Rules 2014 an extract of annual return isplaced on the website of the Company.
18. STATUTORY AUDITORS
M/s. Sathuluri & Co Chartered Accountants were appointed as Statutory Auditorsfor 5 years at the 36th AGM held on 22nd September 2017. The Board of Directors in theirmeeting held on 14.08.2019 ratified the same. M/s. Sathuluri & Co have confirmed thatthey are not disqualified to acts as Statutory Auditors of the Company.
19. REPLIES TO AUDITORS REPORT:
With reference to observations made in Auditor's Report the notes of account areself-explanatory and therefore do not calls for any further comments under section 134(5)of Companies Act 2013.
20. SECRETARIAL AUDIT REPORT:
In terms of Section 204 of the Act and Rules made there under Mr. N.V.S.S.Suryanarayana Practicing Company Secretary has been appointed as Secretarial Auditor ofthe Company for the financial year under review.
Secretarial Audit Report as provided by Shri N. V. S. S. Suryanarayana Rao PracticingCompany Secretary is enclosed as Annexure I to this report. The Secretarial auditor hashighlighted few points in the secretarial audit report. The Board wants to place beforethe members its comments on the observations of the Secretarial auditor which are asbelow:
a) The delay mentioned in the secretarial audit report with respect to delay in filingof Form MGT-15 was made inadvertent. The Company had duly filed form MGT-15 with Registrarof Companies subsequent to the AGM of the Company and generated necessary Challan forpayment of fees towards statutory fees payable which is nominal. However erroneously theChallan payment for the nominal statutory fees was missed by the Company due to humanerror. The same was paid later with additional fees
21. COST AUDITORS
The provisions of Section 148 of the Companies Act 2013 does not apply to the Companyand hence no Cost Auditors are appointed.
22. REPORTING OF FRAUDS BY AUDITORS
During the year under review neither the statutory auditors nor the Secretarialauditor has reported to the audit committee under Section 143 (12) of the Companies Act2013 any instance of fraud committed against the Company by its officers or employeesthe details of which would need to be mentioned in the Board's report.
23. INTERNAL AUDIT & CONTROLS
The Company has appointed M/s. Thirupathi & Associates as its Internal Auditors forthe financial year 2018-19. Their scope of work includes review of processes forsafeguarding the assets of the Company review of operational efficiency effectiveness ofsystems and processes and assessing the internal control strengths in all areas. InternalAuditors findings are discussed with the process owners and suitable corrective actionstaken as per the directions of Audit Committee on an ongoing basis to improve efficiencyin operations.
24. VIGIL MECHANISM:
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.
25. RISK MANAGEMENT POLICY
The Risk Management Policy is in place in the Company enables the Company toproactively take care of the internal and external risks of the Company and ensures smoothbusiness operations.
The Company's risk management policy ensures that all its material risk exposures areproperly covered all compliance risks are covered and the Company's business growth andfinancial stability are assured. Board of Directors decide the policies and ensure theirimplementation to ensure protection of Company from any type of risks.
26. SECRETARIAL STANDARDS
The Company complies with Secretarial Standard-1 and Secretarial Standard-2 withrespect to Board and General Meetings respectively issued by The Institute of CompanySecretaries of India
27. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS ORTRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE
No other significant and material order has been passed by the regulators courtstribunals impacting the going concern status and Company's operations in future.
The Company has not accepted any deposit from the public under Chapter V of the Act orunder the corresponding provisions of Section 73 and 74 of the Companies Act 2013 and noamount of principal or interest was outstanding as on the Balance Sheet date.
29. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS UNDER SECTION 186:
The Company has not given/done any Loans Guarantees and investments covered under theprovisions of section 186 of the Companies Act 2013 during the reporting period.
30. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:
The details regarding transaction with related parties covered under section 188 of theCompanies Act 2013 are given in Annexure II' and forms part of this report.
31. CONSERVATION OF ENERGY FOREIGN EXCHANGE ETC: -
(A) Conservation Of Energy
(i) The steps taken or impact on conservation of energy: Nil
(ii) The steps taken by the company for utilizing alternate sources of energy: Nil
(iii) The capital investment on energy conservation equipments: Nil
(B) Technology absorption
(i) The efforts made towards technology absorption;
(ii) The benefits derived like product improvement cost reduction product developmentor import substitution;
(iii) In case of imported technology (imported during the last three years reckonedfrom the beginning of the financial year)
(a) The details of technology imported;
(b) The year of import;
(c) Whether the technology been fully absorbed;
(d) If not fully absorbed areas where absorption has not taken place and the reasonsthereof;
No technology is imported during financial year 2018-19
(iv) The expenditure incurred on Research and Development: Nil
(C) Foreign exchange earnings and Outgo
Foreign Exchange Inflows: --------- NIL
Foreign Exchange Outflows: INR 83.41 Lakhs
32. Internal Financial Control Systems
The Company has adequate Internal Financial Controls consistent with the nature ofbusiness and size of the operations to effectively provide for safety of its assetsreliability of financial transactions with adequate checks and balances adherence toapplicable statues accounting policies approval procedures and to ensure optimum use ofavailable resources. These systems are reviewed and improved on a regular basis. It has acomprehensive budgetary control system to monitor revenue and expenditure against approvedbudget on an ongoing basis.
The Properties and assets of your Company are adequately insured.
34. CORPORATE GOVERNANCE:
As per regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the Compliance of Corporate Governance norms are not applicable to yourCompany hence the disclosures under the Corporate Governance requirement have not beenmentioned in the Annual Report. Though the provisions of Corporate Governance are notapplicable to the Company the operations and transactions of the Company are done in atransparent manner.
35. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
Management Discussion and Analysis Report pursuant to Regulation 34 reads withSchedule V of Securities and Exchange Board of India (Listing Obligation and DisclosureRequirement) Regulations 2015 forms part of this report and the same is annexed.
36. CORPORATE SOCIAL RESPONSIBILITY
The provisions w.r.t. CSR are not applicable to the Company therefore the Company hadnot constituted CSR committee during the year 2018-19.
37. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND
Your Company did not have any funds lying unpaid or unclaimed for a period of sevenyears. Therefore there were no funds which were required to be transferred to InvestorEducation and Protection Fund (IEPF).
38. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE(PREVENTION PROHIBITION AND REDRESSAL) ACT 2013
The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at the Workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints
Committee (ICC) has been set up to redress complaints received regarding sexualharassment. All employees (permanent contractual temporary trainees) are covered underthis policy. No complaints were received during the year.
39. EMPLOYEE RELATIONS:
Your Directors are pleased to record their sincere appreciation of the contribution bythe workmen and staff at all levels in the improved performance of the Company.
None of the employees are drawing Rs. 850000/- and above per month or Rs.10200000/- and above in aggregate per annum as remuneration the limits prescribedunder provisions of the Companies Act 2013.
40. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The detailed Management Discussion and Analysis Report on the affairs and prospect ofthe Company is enclosed as Annexure III
Your Directors wish to place on record their appreciation of the contribution made bythe employees at all levels to the continued growth and prosperity of your Company.
Your Directors also wish to place on record their appreciation of businessconstituents banks and other financial institutions and shareholders of the Company fortheir continued support and patronage.
| ||By the order of the Board of Directors || |
| ||For Phaarmasia Limited || |
| ||Sd/- ||Sd/- |
| ||Maneesh R. Sapte ||Y. N. Bhaskara Rao |
|Place: Hyderabad ||Managing Director ||Whole Time Director |
|Date: 14th August 2019 ||DIN: 00020450 ||DIN: 00019052 |