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Directors Report of Aarey Drugs & Pharmaceuticals Ltd.

Mar 31, 2015

To,

The Shareholders,

The Directors have pleasure in presenting the Twenty Fifth Annual Report together with Audited Accounts for the year-ended 31st March, 2015.

FINANCIAL RESULTS:

(In Rs.) (In Rs.)

Particular 31st March 2015 31st March'2014

Income 2160325604.00 2013051137.00

Expenditure 2146225747.00 1999640910.00

(Loss )/ Profit Before Exceptional Item & Tax 14099857.00 13410227.00

Profit Before Tax 14099857.00 13410227.00

(Less)/Add: Tax Expenses (3216293.00) (2900382.00)

Balance Carried To Balance Sheet 10883564.00 10509845.00

REVIEW OF OPERATIONS & FUTURE OULLOOK

CREATING NEW CAPACITIES: Our Company proposes to launch new products i.e. Tinidazole which is a forward integration & Glyxol which is a backward. Our Company intends to purchase specialized equipments for expanding the existing products capacity i.e. Metronidazole (MTZ) to 70 M.T, Tinidazole (TNZ) to 25 M.T, Glyaxol to 300 M.T, Metronidazole Benzoate (MBO) to 20 M.T. (MBO) and Ammonium Sulphate (AMS) to 600M.T. The Company has decided to convert the effluent of the company (which the company drains away) into Ammonium Sulphate.

DIVIDEND

Your directors do not recommend any dividend for the year ended 31st March, 2015.

DEPOSITS

The Company has not accepted the deposits from the public as per the Section 58Aof the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975.

CORPORATE SOCIAL RESPONSIBILITY

Since the Company's turnover, net profit and net worth does not exceed the limits mentioned under Section 135 of Companies Act, 2013, the provisions of Corporate Social Responsibility is not applicable to the Company.

DIRECTOR

Mr. Jagdish KShah, Director of the company is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.

To regularize the appointment of Smt. Damiyanti PGhatalia who was appointed by Board as a Woman Director vide its Board Meeting dated 14th February, 2015.

At present, your Company has 3 (Three) Non-Executive Directors out of which two are Independent Directors pursuant to the provisions of the Clause 49 of the Listing Agreement. Pursuant to Section 149 of the Companies Act, 2013, every listed company shall have at least one-third of its total strength of the Board of Directors as Independent Directors. Based on the present composition of the Board of Directors and the number of Independent Directors, the Company complies with this requirement.

During this Annual General Meeting, it is proposed to confirm the appointment of all the present Independent Directors to bring their appointment in tune with the provisions of the Companies Act, 2013. Pursuant to the provisions of the Companies Act, 2013, the period of appointment of Independent Directors shall be 5 (Five) consecutive years from the date of their appointment at Annual General Meeting and they are not liable to retire by rotation.

The Company has received notices under Section 160 of the Companies Act, 2013 (Section 257 of the Companies Act, 1956) proposing appointment of 2 (Two) Independent Directors.

In the opinion of your Directors, your Company will continue to benefit from Mr. Chetan K. Mehta and Mr. Satish M.Sheth, Non-Executive Independent Directors in their capacity as Director of your Company. Your Directors, therefore, recommend that the proposed resolutions relating to appointment of these Directors be passed.

DIRECTORS RESPONSIBILITY STATEMENT

As referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, the Directors hereby confirm:

i) that in preparation of the Annual Accounts for the year ended 31st March, 2015, the applicable accounting standards had been followed along with proper explanation relating to material departures , if any;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give true and fair view of the state of affairs of the company at the end of financial year ended 31st March, 2015 and the profit/(Loss) of the Company for the year under review;

(iii) that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(iv) that the annual accounts for the year ended 31st March,2015 have been Prepared on a" going concern basis"

ANNUAL RETURN

As per section 92(3)of the Companies Act, 2013, the extract of the Annual Return is annexed here to as Annexure A.

AUDITORS

M/s. DMKH & Company, who were appointed as Auditors to hold office until the conclusion of the 29th Annual General Meeting to be held in the calendar year 2019 are eligible for re-appointment. The Company has received the Certificate from them to this effect.

SECRETARIAL AUDIT REPORT

Pursuant to Section 204 of the Companies Act, 2013, the Board of Directors had appointed Mr. Virendra Bhatt, Practising Company Secretaries as the Secretarial Auditor of the Company for the financial year 2014-15.

Accordingly, the Secretarial Auditors have given their report, which is annexed hereto as Annexure B. The comments of the Board on the observations of the Secretarial Auditors are given after Annexure B above.

BOARD MEETINGS

The details pertaining to the composition, terms of reference, etc. of the Board of Directors of the Company and the meetings thereof held during the financial year are Given in the Report on Corporate Governance section forming part of this Annual Report.

DECLARATION OF INDEPENDENCE BY INDEPENDENT DIRECTOR

The Board confirms that all Independent Directors of the Company have given a Declaration to the Board that they meet the criterion of independence as prescribed under Section 149 of the Companies Act, 2013.

COMMITTEES OF THE BOARD

The details of the powers, functions, composition and meetings of the Committees of the Board held during the year are given in the Report on Corporate Governance section forming part of this Annual Report.

AUDIT COMMITTEE

The details pertaining to the composition, terms of reference, etc. of the Audit Committee of the Board of Directors of the Company and the meetings thereof held during the financial year are given in the Report on Corporate Governance section forming part of this Annual Report. The recommendations of the Audit Committee were accepted by the Board of Directors of the Company from time to time.

CORPORATE GOVERNANCE

A separate report on Corporate Governance is produced as a part of the Annual Report along with the Auditors statement on its compliance.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO:

Your Company has made the necessary disclosures in this Report in terms of Section 134(3) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is given in Annexure C and forms part of this report.

RELATED PARTY TRANSACTIONS:

Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arm's length transactions under third proviso thereto (Pursuant to clause (h) of sub-section (3)of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014) Details of material contracts or arrangement or transactions at arm's length basis

EMPLOYEES:

There were no employees coming under the purview of Section 197(12) of the Act read with Rules 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and the rules frame there under.

REMUNERATION:

As per Section 197 of the Companies Act, 2013, the ratio of remuneration of each director to the median remuneration of the employees of the company for the financial year:

Name of the Director Ratio to Median employees

Mihir R Ghatalia, Managing Director 5:3

DISCLOSURE UNDER SECTION 164

None of the Directors of the company are disqualified for being appointed as Directors as specified under section 164 of the Companies Act, 2013.

ACKNOWLEDGEMENTS

Your Directors wish to place on record, the appreciation for the continued support of the customers, Bankers and Suppliers. Your Directors acknowledge and thank the employees for their valuable contribution and involvement.

For and on behalf of the Board of Directors

Jagdish K.Shah

CHAIRMAN

Place: Mumbai

Date : 30th May, 2015


Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Twenty Fourth Annual Report together with Audited Accounts for the year-ended 31st March, 2014.

FINANCIAL RESULTS:

(In Rs.) (In Rs.) Particular 31st March'' 2014 31st March'' 2013

Income 2013051137.00 1725120473.00

Expenditure 1999640910.00 1716095267.00

(Loss )/ Profit

Before Exceptional Item & Tax 13410227.00 9025206.00

Profit Before Tax 13410227.00 9025206.00

(Less)/Add: Tax Expenses (2900382.00) (2442690.00)

Balance Carried To Balance Sheet 10509845.00 6582517.00

REVIEW OF OPERATIONS & FUTURE OUTLOOK

CREATING NEW CAPACITIES: Our Company proposes to launch new products i.e. Tinidazole which is a forward integration & Glyxol which is a backward. Our Company intends to purchase specialized equipments for expanding the existing products capacity

i.e. Metronidazole (MTZ) to 70 M.T, Tinidazole (TNZ) to 25 M.T, Glyaxol to 300 M.T, Metronidazole Benzoate (MBO) to 20 M.T. (MbO) and Ammonium Sulphate (AMS) to 600M.T. The Company has decided to convert the effluent of the company (which the company drains away) into Ammonium Sulphate.

DEMERGER: The Company is in process of demerger of its DEF Division, i.e. business of Acetic Acid, Butyl Acrly Monomer, Tolune and Vinaly Acitate Monomer, with Enam Organics India Limited under Clause 24(f) of the listing agreement under the scheme of Arrangement for Demerger u/s 391 to 394 of the Companies Act, 1956. The Company has already filed an application for the same with BSE on 3rd December, 2013.

DIVIDEND

Your directors do not recommend any dividend for the year ended 31st March, 2014.

DEPOSITS

The Company has not accepted the deposits from the public as per the Section 58A of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975.

DIRECTOR

Mr. Lalit R Tulsiani, Director of the company is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.

DIRECTORS RESPONSIBILITY STATEMENT

As required under the provisions of Section 217 (2AA) of the Companies Act, 1956, the Directors hereby confirm:

i) that in preparation of the Annual Accounts for the year ended 31st March, 2014, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;

ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give true and fair view of the state of affairs of the company at the end of financial year ended 31st March, 2014 and the profit/(Loss) of the Company for the year under review;

iii) that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) that the annual accounts for the year ended 31st March,2014 have been prepared on a "going concern basis"

AUDITORS

M/s. DMKH & Company, who were appointed as Auditors to hold office until the conclusion of the ensuing Annual General Meeting are eligible for re-appointment. The Company has received the Certificate from them to this effect.

AUDIT COMMITTEE

The Company has formed the Audit Committees as per Section 292A of the Companies Act, 1956. The Members of the Committees are experts in finance matters, company law and general business practice.

CORPORATE GOVERNANCE

A separate report on Corporate Governance is produced as a part of the Annual Report along with theAuditors statementon its compliance.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information in accordance with the provisions of Section 217(1)(e) of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in annexure and forms part of this report.

EMPLOYEES:

There were no employees coming under the purview of Section 217(2A) of the Companies Act, 1956 and the rules frame there under.

DISCLOSURE UNDER SECTION 274

None of the Directors of the company are disqualified for being appointed as Directors as specified under section 274 of the Companies Act, 1956 as amended by the Companies (Amendment)Act, 2000.

ACKNOWLEDGEMENTS

Your Directors wish to place on record, the appreciation for the continued support of the customers, Bankers and Suppliers. Your Directors acknowledge and thank the employees for their valuable contribution and involvement.

For and on behalf of the Board of Directors Jagdish K.Shah CHAIRMAN

Place: Mumbai Date : 30th MAY,2014


Mar 31, 2012

To, The Shareholders,

The Directors have pleasure in presenting the Twenty Second Annual Report together with Audited Accounts for the year-ended 31st March, 2012.

FINANCIAL RESULTS:

(In Rs) (In Rs. )

Particular 31st March' 2012 31st March' 2011

Income 1306165678 678404953

Expenditure 1302054450 668449763

(Loss )/ Profit Before Exceptional 4111228 9955190 Item & Tax

Profit Before Tax 4111228 9955190

(Less)/Add: Balance Brought 47981323 40075767

Forward From Previous Year

Less: Income Tax Provision 1272506 2049635

Balance Carried To Balance Sheet 51224923 47981322

During the year the Company has issued the Rights Shares in the ratio of 2:1 at a price of Rs. 25.00 pershare (including premium of Rs.15.00 per share).

REVIEW OF OPERATIONS & FUTURE OUTLOOK

1. PROFIT FROM WASTE : Company plans to manufacture Ammonium Sulphate from effluent, which at present is drained away, additional investment of Rs. 95.22 lacs is required, the company has already invested Rs. 90 lacs from internal accruals & Share application money, company has already placed order for required machinery & expects to start productions by 31st March'2013. This will add to profitability of company.

2. CREATING NEW CAPACITIES : Company plans to increase capacity by app. 80% of existing capacity of Metronidazole (MTZ) and Metronidazole Benzoate (MBO) i.e. from 35 M.T. (MTZ) to 65 M.T.(MTZ) and from 10.50 M.T. (MBO) to 20 M.T. (MBO) respectively, Additional investment of Rs.177.76 lacs is required the Company has already invested Rs. 160 lacs through internal accruals & Share application money. Company has already placed order for required machinery & expects to starts production by 31st March'2013.

3. EXPANDING PRODUCT BASKET: Company plans to add new products i.e. Tinidazole, Glyoxal and Sildenafil Citrate. The total requirement for addition of this 3 products is Rs.875.76 lacs out of which the company has already invested Rs.672.91 lacs towards expansion. This investment is done through Internal accruals & Share application money. Company has already placed order for required machinery & expects to starts production by September'2013

DIVIDEND

Your directors do not recommend any dividend for the year ended 31st March, 2012.

BONUSISSUE

The Company has declared bonus shares in the ratio of 1:5, i.e. one bonus share for every five equity shares held as on the record date, during the month of June, 2012.

DEPOSITS

The Company has not accepted the deposits from the public as per the Section 58Aof the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975. .

DIRECTOR

Mr. Satish Sheth, Director of the company is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.

DIRECTORS RESPONSIBILITY STATEMENT

As required under the provisions of Section 217 (2AA) of the Companies Act, 1956, the Directors hereby confirm:

i) that in preparation of the Annual Accounts for the year ended 31st March, 2012, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any;

ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give true and fair view of the state of affairs of the company at the end of financial year ended 31st March,2012 and the profit/(Loss) of the Company for the year under review;

iii) that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) that the annual accounts for the year ended 31st March,2012 have been prepared on a "going concern basis"

AUDITORS

M/s. DMKH & Company, who were appointed as Auditors to hold office until the conclusion of the ensuing Annual General Meeting are eligible for re-appointment. The Company has received the Certificate from them to this effect.

AUDIT COMMITTEE

The Company has formed the Audit Committees as per Section 292Aof the Companies Act, 1956. The Members of the Committees are experts in finance matters, company law and general business practice.

CORPORATE GOVERNANCE

A separate report on Corporate Governance is produced as a part of the Annual Report along with the Auditors statement on its compliance.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information in accordance with the provisions of Section 217(1)(e) of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in annexure and forms part of this report.

EMPLOYEES:

There were no employees coming under the purview of Section 217(2A) of the Companies Act, 1956 and the rules frame there under.

DISCLOSURE UNDERSECTION 274

None of the Directors of the company are disqualified for being appointed as Directors as specified under section 274 of the Companies Act, 1956 as amended by the Companies (Amendment)Act, 2000.

ACKNOWLEDGMENTS

Your Directors wish to place on record, the appreciation for the continued support of the customers, Bankers and Suppliers. Your Directors acknowledge and thank the employees for their valuable contribution and involvement.

For and on behalf of the Board of Directors

Jagdish K.Shah

CHAIRMAN

Place: Mumbai

Date : 06th September, 2012


Mar 31, 2010

The Directors have pleasure in presenting the Twentieth Annual Report together with Audited Accounts for the year-ended 31st March, 2010.

FINANCIAL RESULTS:

Particular 31sl March 20101 31 st March, 2009

Income 466466632.00 275682698.21

Expenditure 456955200.39 266570478.06

(Loss )/ Profit Before Exceptional Item & Tax 9511431.61 9112220.15

Profit Before Tax 9511431.61 9118609.88

(Less)/Add: Balance Brought Forward From Previous Year 31970732.23 24235226.35

Balance Carried To Balance Sheet 40075766.84 31970732.23

The Board of Directors has already under proceeds issuing the Rights Shares in the ratio of 2:1 at a price of Rs.25.00 per share (including premium of Rs. 15.00 per share or such other price as may be decided by the board.

REVIEW OF OPERATIONS & FUTURE OULLOOK

1. PROFIT FROM WASTE : Company plans to manufacture Ammounium Sulphate from effluent, which at present is drained away, additional investment of Rs.60 lacs is required which is invested from internal accruals, company has already placed order for required machinery & expects to start productions by 31s1 March2011 This will add to profitability of company.

2. CREATING NEW CAPACITIES : Company plans to increase capacity by appx. 80 % of existing capacity of Metronidazole (MTZ) and Metronidazole Benzoate (MBO) i.e.from 35 M.T. (MTZ) to 65 M.T.(MTZ) and from 10.5 M.T. (MBO) to 20 M.T. (MBO) respectively, the company plans to increase capacity by 31st March2011. Appx. Rs. 160 lakhs required will be invested through internal accruals & from bank/financial institution.

3. EXPANDING PRODUCT BASKET : Company plans to add new products i.e. Tinidazole and Glyoxal. Which ill commence production by June2011. Additional investment of Rs. 300 lakhs, would be funded from bank / financial institution.

DIVIDEND

Your directors do not recommend any dividend for the year ended 31s1 March, 2010.

DEPOSITS

The Company has not accepted the deposits from the public as per the Section 58Aof the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975.

DIRECTOR

Mr. Jagdish K. Shah & Mr. Chetan K. Mehta Directors of the company are liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

DIRECTORS RESPONSIBILTY STATEMENT

As required under the provisions of Section 217 (2AA) of the Companies Act, 1956, the Directors hereby confirm:

i) that in preparation of the Annual Accounts for the year ended 31s1 March,2010, the applicable accounting standards had been followed along with proper explanation relating to material departures , if any;

ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give true and fair view of the state of affairs of the company at the end of financial year ended 31st March,2010 and the profit/(Loss) of the Company for the year under review;

iii) that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act ,1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) that the annual accounts for the year ended 31st March,2010 have been prepared on a "going concern basis"

AUDITORS

M/s. Atul Dave & Company, Chartered Accountants, Pune who were appointed as Auditors to hold office until the conclusion of the ensuing Annual General Meeting are eligible for re-appointment. The Company has received the Certificate from them to this effect.

AUDIT COMMITTEE

The Company has formed the Audit Committees as per Section 292A of the Companies Act, 1956. The Members of the Committees are experts in finance matters, company law and general business practice.

CORPORATE GOVERNANCE

A separate report on Corporate Governance is produced as a part of the Annual Report along with the Auditors statement on its compliance.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information in accordance with the provisions of Section 217(1)(e) of the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in annexure and forms part of this report.

EMPLOYEES:

There were no employees coming under the purview of Section 217(2A) of the Companies Act, 1956 and the rules frame there under.

DISCLOSURE UNDER SECTION 274

None of the Directors of the company are disqualified for being appointed as Directors as specified under section 274 of the Companies Act, 1956 as amended by the Companies (Amendment) Act, 2000.

ACKNOWLEDGEMENTS

Your Directors wish to place on record, the appreciation for the continued support of the customers, Bankers and Suppliers. Your Directors acknowledge and thank the employees for their valuable contribution and involvement.

For and on behalf of the Board of Directors

Jagdish K.Shah

Chairman

Place : Mumbai

Date : 27th August, 2010





 
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