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Directors Report of Bafna Pharmaceuticals Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Twentieth Annual Report of your Company together with Audited Accounts for the Financial Year ended 31st March, 2015.

Financial Performance

The summarized Audited Financial Results for the year ended 31st March, 2015 along with comparative figures for the previous year is as under:

(Rs. In 000)

Standalone

Particulars 31st March, 31st March, 2015 2014

Total Income 14,36,553.02 17,89,445.90

Total Expenditure 12,96,506.57 1,683,959.02

Profit before Depreaati°n & 140,046.45 105,486.88 Taxation

Less: Depreciation 52,375.87 83,235.79

Less: Exceptional Items - -

Profit before Tax 60,789.57 22.251.09

Less: Provision for Taxation (22,587.38) (4,200.00)

Less: Provision for Deferred Tax 22,871.05 (4,689.69)

Minority Interest (Loss) -

Profit after Tax for the year 61,073.34 13,361.40

Consolidated

Particulars 31st March, 31st March, 2015 2014

Total Income 1,436,815.13 1,871,940.30

Total Expenditure 1,287,946.12 1,757,089.94

Profit before Depreaati°n & 148,869.01 114,850.36 Taxation

Less: Depreciation 59,854.65 89,938.37

Less: Exceptional Items 28,342.57 -

Profit before Tax 60,671.79 24,911.99

Less: Provision for Taxation (22,587.38) (4,700.00)

Less: Provision for Deferred Tax 24,113.06 (5,767.72)

Minority Interest (Loss) (423.68) (408.14)

Profit after Tax for the year 61,773.79 14,036.14

Consolidated Operating Results

The consolidated sales and operating income decreased to Rs. 143.68 Cr from Rs. 187.19 Cr in the previous year yielding a decline in growth of 23.24% due to sale of Brand happened during the year. The consolidated operating profit for the year was Rs. 14.89 Cr as against Rs. 11.49 Cr in the previous year. The consolidated net profit for the year 2015 was Rs. 6.18 Cr as against FY 2014 of Rs. 1.40 Cr.

Standalone Operating Results

The sales and operating income decreased to Rs. 143.66 Cr from Rs. 178.94 Cr in the previous year decline rate of 19.72%. The operating profit for the year under review is Rs. 14.00 Cr as against Rs. 10.55 Cr in the previous year. The profit after tax for the year under review is Rs. 6.11 Cr as against Rs. 1.34 Cr in the previous year.

The company is in growth/expansion mode requiring further investment; your company is therefore evaluating various options to raise additional funds for which shareholders approval may be sought as and when things are finalized.

Subsidiary Company & Consolidated Financial Results

The consolidated financial results comprise of M/s. Bafna Pharmaceuticals Limited and its subsidiary M/s. Bafna Lifestyles Remedies Limited. Consolidated Financial Statements for the year ended 31st March, 2015 forms part of the Annual Report.

As required under the Listing Agreements entered into with the Stock Exchanges, consolidated financial statements of the Company and its subsidiary are attached. The consolidated financial statements have been prepared in accordance with the relevant accounting standards as prescribed under section 133 of the Companies Act, 2013. The consolidated financial statements disclose the assets, liabilities, income, expenses and other details of the Company and its subsidiaries.

Material/significant changes in subsidiary, during the year the subsidiary company has discontinued the marketing activities.

A statement pursuant to Section 129 of the Companies Act, 2013, relating to subsidiary companies is attached and forms part of the report.

Change in Capital Structure

(Rs. In 000)

Particulars 31st March, 2015 31st March, 2014

Authorized Capital 400,000.00 400,000.00

Issued, Subscribed & Paid up Capital 186,563.35 186,563.35

Fixed Deposits

The company has not accepted / invited any deposits from the public in terms of Section 73 of the Companies Act, 2013

Dividend

The Company wishes to conserve the resources, hence your directors do not recommend any dividend for the Financial Year.

Directors

During the year Ms. K.Sabitha was appointed as an Additional director / women director in the Board meeting held on 27th March 2015. Your Board recommends for appointment of Ms. K. Sabitha as a Director.

The Composition of Board and number of meetings attended by them are given in the corporate governance report.

Pursuant to Section 149, 152 and other applicable provisions of the Companies Act, 2013 read with Rules thereon, Shri V. Rajamani, Shri R. Dwarakanathan, Shri B. Kamlesh Kumar & Shri Sunil Bafna were appointed as Independent Directors for five consecutive years in the Nineteenth AGM held on 10.09.2014 upto 09.09.2019. Accordingly all the Independent Directors were appointed in the last AGM to align with the requirement of the Companies Act, 2013. The necessary declarations were also obtained from the Independent Directors on yearly

Directors liable to retire by rotation

Shri. Bafna Mahaveer Chand, Chairman & Managing Director & Shri. Paras Bafna, Whole Time Director are not liable to retire by rotation as per their terms of appointment / Articles Of Association of the company. However, they are subject to retire by rotation as per the provisions of Section 149 & 152 of the Companies Act, 2013. All Directors in the Board are Independent except Shri. Bafna Mahaveer Chand & Shri. Paras Bafna and as Independent Directors are not liable to retire by rotation, Shri. Bafna Mahaveer Chand & Shri. Paras Bafna will retire by rotation in terms of Section 152 of the Companies Act, 2013 and being eligible they have offered themselves for re-appointment. Upon re-appointment as Director Shri. Bafna Mahaveer Chand shall continue to hold office as the Chairman and Managing Director of the Company.

The brief resume of the Directors seeking appointment / reappointment and other information have been detailed in the Notice. Your Board recommends the above appointments /reappointment of Directors in the best interest of the Company.

Auditors

M/s. Abhay Jain & Co., Chartered Accountants, Chennai who are the statutory auditors of the Company, were reappointed for a period of 3 years ( from 2014 to 2017), subject to ratification by the members at every AGM. Hence, ratification has been sought for, from the members as per the terms of appointment made during 2014. M/s. Abhay Jain & Co., Chartered Accountants, Chennai have given their consent for re-appointment and also confirmed that their appointment would be within the prescribed limits under Section 141 of the Companies Act, 2013.

Accordingly, the ratification of re-appointment of M/s. Abhay Jain & Co., Chartered Accountants, Chennai, as the Statutory Auditors, is being proposed as an Ordinary Resolution.

The Board recommends ratification of re-appointment as Statutory Auditors of the Company. The report of Auditors and notes forming part of the Accounts are attached along with the Annual Report.

There is no observation made in the Auditors' Report for the period and hence no further comments required under Section 134 of the Companies Act, 2013.

Cost Audit

The Board of Directors of the Company appointed M/s Thanigaimani & Associates, Cost Accountants (FRN No.101899) as the Cost Auditor of the Company for audit of cost accounts relating to formulations for the year ended 31st March 2015. The Cost Audit report for the year ended 31st March 2014 was filed on 26.11.2014 and the Cost Audit Compliance Report was filed on 26.11.2014. The Cost Audit Report & Cost Audit Compliance Report for the year ended 31st March, 2015 shall be submitted to the Central Government in due course.

As per Section 148 read with Companies (Audit and Audit) Rules, 2014 and other applicable provisions if any of the Companies Act, 2013, the Board of Directors of the Company has appointed M/s Thanigaimani & Associates, Cost Accountants as Cost Auditor of the Company for the financial year 2015-16. The remuneration proposed to be paid to the Cost Auditors, subject to the ratification by the members at the ensuing Annual General Meeting, would be Rs. 45,000/- (Rupees Forty Five Thousand Only) plus applicable taxes and out of pocket expenses.

Listing

The Company's shares are listed at (i) Bombay Stock Exchange Limited (BSE) with Scrip Code No. 532989 and at (ii) National Stock Exchange of India Limited with Scrip symbol BAFNAPHARM; the necessary Listing Fees have been paid to the stock exchanges.

Particulars of employees

a) Details of employees, employed throughout the financial year, was in receipt of remuneration for that financial year, in the aggregate, was not less than Rs. 60 lakhs. -Nil-

b) Details of employees, employed for a part of the financial year, was in receipt of remuneration for any part of that year, at a rate which, in the aggregate, was not less than five lakh rupees per month -Nil -

c) Details of employees, if employed throughout the financial year or part thereof, was in receipt of remuneration in that year which, in the aggregate, or as the case may be, at a rate which, in the aggregate, is in excess of that drawn by the managing director or whole-time director or manager and holds by himself or along with his spouse and dependent children, not less than two percent of the equity shares of the company. — Nil -

Foreign Exchange earnings and outgo

The particulars in respect of Foreign Exchange Earnings and Outgo as required under Section 134) of the Companies Act, 2013 and Rule 8(3) of the Companies ( Accounts) Rules 2014, are given as in Annexure to this report.

Human Resource, Industrial Relations, Environment, Occupational Health and Safety

The Company is continuously focusing on managing talent and increasingly systematizing the HR processes. We have excellent industrial relations across all facilities including corporate office and strongly believe that the workers will continue to work towards profitable and productive company.

The number of employees as on 31st March, 2015 was 251 as against 677 during FY2013-14, a net decrease of 426 employees. This is was largely due transfer of Domestic Branded division during the year.

Conservation of energy, Technology Absorption & Research and Development (R & D)

The company is conscious of its responsibility to conserve the energy and has taken measures in relation to conservation of energy and technology absorption. The particulars in respect to conservation of energy, Technology Absorption & Research and Development were given in the annexure to the Board's Report.

Insider Trading Regulations

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 2005, as amended from time to time, the code of conduct for prevention of insider trading and the code for corporate disclosures are in force. The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated persons of the Company, as per SEBI (Prohibition of Insider Trading) Regulations, 2015.

Corporate Governance

Report on Corporate Governance and Certificate of the Auditors of your Company regarding compliance of the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement with the Stock Exchanges, are enclosed elsewhere in the Annual Report and forms part of this report.

Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Board of Directors has approved policy as per the said Act. And an Internal Complaints Committee was constituted, with following members:

(i) Ms. Hemalatha, Commercial Manager - Chairperson

(ii) Mr. Meenakshi Sundaram, HR - Member

(iii) Ms. Sundari, HR Executive - Member

The committee placed certificate before the Board of Directors on the status of compliance of the Act. As per the certificate provided by the said committee no complaints were received during the year & that there are no complaints pending as on 31st March, 2015.

Corporate Social Responsibility

The applicability of Corporate Social Responsibility under Sec 135 of the Companies Act, 2013 is not applicable to the Company. But however Company is committed to improve the quality of life of the workforce and their families and also the community and society at large. The Company believes in undertaking business in such a way that it leads to overall development of all stake holders and society.

Secretarial Audit for the FY 2015-16

In terms of Section 204 of the Companies Act, 2013, the rules made thereunder & other applicable provisions, if any, the company is required to appoint Secretarial Auditor to carry out Secretarial Audit of the Company. Your Board of Directors has appointed M/s. A.K. Jain & Associates, Practicing Company Secretaries, Chennai for purpose of Secretarial Audit for the FY 2015-16 at the Board Meeting held on 29.05.2015.

As required under section 204 (1) of the Companies Act, 2013 the Company has obtained a secretarial audit report and contains one qualification for non-appointment of CFO for the Company. The copy of the Secretarial Audit report in MGT 3 is attached as an annexure to the Director's Report.

Reply to the qualification: The Company is taking necessary steps to appoint the Chief Financial Officer.

Re-appointment of Mr. Gaurav Jain, Chartered Accountant, Chennai as Internal Auditors & approved their Scope, Functions, Periodicity & Methodology

In terms of Section 138 of the Companies Act, 2013 & other applicable provisions, if any, Board of Directors at the Board Meeting held on 29.05.2015 has appointed Mr. Gaurav Jain, Chartered Accountant, and Chennai as Internal Auditors and further approved their Scope, Functions, and Periodicity & Methodology.

"Audit Committee"

In terms of Section 177 of the Companies Act, 2013 and other applicable provisions if any and as per the clause 49 of the Listing agreement the Audit committee comprises of 4 Directors out of which 3 are Non-Executive Independent Directors. The terms of reference of Audit Committee includes matters specified in section 177 of the Companies Act 2013 and Clause 49 of the Listing Agreement (as revised with effect from 1.10.2014). The Board has accepted all the recommendations of the audit committee made during the year

"Nomination & Remuneration Committee"

In terms of Section 178 of the Companies Act, 2013 & other applicable provisions, if any, Board of Directors at the Board Meeting held on 30.05.2014 has renamed the existing "Remuneration Committee" of the Board of Directors as "Nomination & Remuneration Committee". There was no change in the members of the Committee. The Policy of Nomination & remuneration committee were given in the corporate governance report.

"Stakeholders Relationship Committee"

In terms of Section 178 of the Companies Act, 2013 & other applicable provisions, if any, Board of Directors at their meeting held on 30.05.2014 renamed the existing "Investor Grievance & Share Transfer Committee" as "Stakeholders Relationship Committee".

Management Discussion and Analysis Report

Management Discussion and Analysis Report, as required under the Listing Agreement with the Stock Exchange is enclosed elsewhere in the Annual Report and forms part of this Report. Certain Statements in the report may be forward-looking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of future performance & outlook.

Extract of Annual Return;

The details forming part of the extract of the Annual Return in form MGT-9 is annexed along with the Director's Report.

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 employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and others entitled thereto, excludingthe information on employees' particulars which is available for inspection by the members at the Registered office of the company during business hours on working days of the company up to the date of ensuing Annual General Meeting. If any member is interested in inspecting the same, such member may write to the company secretary in advance.

Directors Responsibility Statement

Your Directors wish to inform that the Audited Accounts contains Financial Statements for the financial year ended 31st March, 2015 are in full conformity with the requirements of the Companies Act, 2013. They believe that the Financial Statements reflect fairly the form and substance of transaction carried out during the year and reasonably present your Company's financial conditions and result of operations.

Your Directors further confirm that in preparation of the Annual Accounts:

* The applicable accounting standards had been followed and wherever required, proper explanations relating to material departures have been given;

* The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

* Proper and sufficient care has been taken for the 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;

* The Accounts have been prepared on a "going concern" basis.

* The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

* The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively

Acknowledgement and Appreciation

Your Directors would like to thank Company's Bankers - SBI, EXIM, DBS, DCB, BOC & IDBI for their continued support and they would also like to express their gratitude for the co-operation and assistance extended to the Company by its Customers, Suppliers, Technical Consultants, Contractors, Government and Local Authorities, etc. The Directors also wish to thank all its Shareholders for their unstinted support. The Directors would like to sincerely thank and place on record their appreciation of the consistent and dedicated services of the employees at all levels who have immensely contributed to the performance of the Company during the period under review.

On behalf of the Board of Directors For Bafna Pharmaceuticals Limited (CIN L24294TN1995PLC030698)

Place : Chennai Paras Bafna Bafna Mahaveer Chand Date: 29.05.2015 (DIN: 01933663) (DIN: 01458211) Whole Time Director Chairman & Managing Director


Mar 31, 2012

The Directors have pleasure in presenting the Seventeenth Annual Report of your Company together with Audited Accounts for the Financial Year ended 31st March, 2012.

Financial Performance

The summarized Audited Financial Results for the year ended 31st March, 2012 along with comparative figures for the previous year is as under:

Rupees in Lakhs

PARTICULARS Standalone Consolidated 2012 2011 2012

Total Income 1250082.36 1019243.03 1301111.96

Total Expenditure 1136737.07 941314.95 1183049.62

Profit before Depreciation & Taxation 113345.29 77928.08 118062.34

Less: Depreciation 58380.11 27690.70 55034.44

Less: Exceptional Items 1311.28 0 1320.34

Profit before Tax 53653.90 50237.38 53714.10

Less: Provision for Taxation 10500.00 10658.90 10500.00

Less: Provision for Deferred Tax 22413.01 6096.57 24159.38

Minority Interest (Loss) - - (647.19) Profit after Tax for the year 20740.89 33481.91 18407.53

The Company's revenue for the year FY'12 is Rs.1250082.36 (Rs. '000) as against Rs.1019243.03 (Rs. '000) in FY'11 registering a YOY growth of 22.64%.

Awards & Achievements

IDMA - Gold Award - Quality Excellence Award

Category: Formulations Units - Companies with total annual turnover above Rs. 100 Crores Subsidiary Company & Consolidated Financial Results

The consolidated results of the Company comprise of M/s. Bafna Pharmaceuticals Limited and its subsidiary M/s. Bafna Lifestyles Remedies Limited. Consolidated Financial Statements for the year ended March 31, 2012 forms part of the Annual Report.

The consolidated financial statements prepared in accordance with Accounting Standard - 21 issued by the Institute of Chartered Accountants of India forming part of this Annual Report include the financial information of the subsidiary company.

A statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary companies is attached to the accounts.

Change in Capital Structure

Amount in Rs

Particulars 31.03.2012 31.03.2011

Authorized Capital 40,00,00,000 20,00,00,000

Issued, Subscribed & Paid up Capital 18,38,13,350 17,48,13,350

The company has allotted 9, 00,000 Equity shares on 13.01.2012.

Fixed Deposits

Your company has not accepted any deposits from the public during the year under report.

Dividend

Considering the resource requirements for working capital, the company wishes to conserve the resources and so your Directors do not recommend any dividend for the Financial Year.

Depository system

Company's shares are under compulsory demat mode and members are requested to dematerialize their share for operational convenience.

Directors

Shri. A. Sahasranaman and Shri.R. Dwarakanathan, Directors are liable to retire by rotation. They being eligible offer themselves for re-appointment.

Auditors

M/s. Abhay Jain & Co., Chartered Accountants, Chennai the Auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

Cost Audit

The Board of Directors of the Company appointed M/s. Sivasubramanian & Co., Cost Accountants, as the Cost Auditor of the Company for audit of cost accounts relating to formulations the year ended 31st March 2012. The Cost Audit report for the year ended 31st March 2012 shall be submitted to the Central Government in due course.

Preferential Issue of Shares & Warrants

The company in accordance with Statutory provisions including SEBI {Issue of Capital and Disclosure Requirements} Regulations, 2009, Listing Agreement entered into with the Stock Exchange and with the approval of members has issued and allotted on 13th day of January, 2012, 9,00,000 Equity shares of Rs.10/- each at a premium of Rs.40/- per share and 25,00,000 warrants convertible into 25,00,000 Equity shares of Rs.10/- each at a premium of Rs.40/- per share. The aforesaid shares and warrants are subject to lock-in period as prescribed under SEBI Guidelines. With respect to allotment of warrants the company has received

25% of the warrant price on subscription and the balance issue price is payable upon exercise of the right to apply for Equity Shares within a period of 18 months from the date of issue of warrants.

The Statement of utilization of proceeds of 9,00,000 Equity shares and 25,00,000 warrants convertible into 25,00,000 Equity shares:

1. Nature of Issue

Issue of 9,00,000 Equity Shares of Rs.10/- each at a premium of Rs.40/- per share and 25,00,000 warrants convertible into 25,00,000 Equity Shares of Rs.10/- each at a premium of Rs.40/- on preferential basis as per SEBI {Issue of Capital and Disclosure Requirements} Regulations, 2009.

2. Size of the issue

9, 00,000 Equity Shares and 25, 00,000 warrants convertible into 25, 00,000 Equity Shares.

3. Aggregate amount of the issue size

Rupees in Lakhs

SI No Particulars Amount

1 9,00,000 Equity Shares 450.00

2 25,00,000 warrants convertible into 25,00,000 Equity Shares 312.50

TOTAL 762.50

4. Objects of the issue

To augment and achieve the long term plans of the Company and to meet the funds requirements for expansion, product and market diversification, brand acquisition(s), repayment of Term Loan(s) / Debt, working capital and general corporate purposes.

5. Utilisation of the issue Funds raised have been utilized as per the objects of the issue as stated below:

Rupees in Lakhs SI No Particulars Amount

1 For expansion 412.50

2 For working capital 350.00

TOTAL 762.50

Outstanding warrants

The Board of Directors allotted 23,18,000 warrants convertible into 23,18,000 equity shares on 17.03.2011; the said warrants are yet to be converted into Equity Shares. And further allotted 25,00,000 warrants convertible into 25, 00,000 equity shares on 13.01.2012, the said warrants are yet to be converted into Equity Shares.

Listing

The Company shares are listed at Bombay Stock Exchange Limited and the necessary Listing Fees have been paid to the stock exchange. The company has made an application to National Stock Exchange of India Limited for Listing the Equity Shares.

Revised Schedule VI

The revised Schedule VI has become applicable to the company for presentation of Financial Statements for the year ended 31st March, 2012 accordingly previous year / period figures have been regrouped / reclassified wherever necessary.

Particulars of employees

There are no employees covered under the provisions of Section 217(2A) of the Companies Act, 1956 and the Rules made there under. Therefore a statement giving particulars of employees in pursuance to the above referred section is not enclosed.

Foreign Exchange

Your company earned foreign exchange of Rs.385883.60 (Rs.'000) (previous year Rs.240451.23 (Rs.'000)) from exports and the foreign exchange outgo was Rs. 43012.41 (Rs.'000) (previous year Rs.34191.62 (Rs.'000)) on account of international travel and purchase of foreign currency during the year ended 31st March, 2012.

Human Resource, Industrial Relations, Environment, Occupational Health and Safety

The Company is continuously focusing on managing talent and increasingly systematizing the HR processes. We have excellent industrial relations across all facilities including corporate office and strongly believe that the workers will continue to work towards profitable and productive company.

During the economic downturn, the Human resources played a key role of strategic influencer, and in alignment with business goals, delivered on numerous initiatives. We believe that employee's engagement with higher expectations leads to maximum contributions. Acquisition and retention of talent continues to be a major thrust area. With an eye on long term, the company has begun several programmes and engages employees to enhance their knowledge / skills in line with company's goals.

As on 31st March, 2012 the number of employees were 358 including managerial staff.

Conservation of energy

The company is conscious of its responsibility to conserve the energy and has taken measures in relation to conservation of energy and technology absorption. The company has taken few measures in relation to conservation of energy and technology absorption. In production process we are using steam boilers in addition to use of certain drying system. This together with other measures that are taken by the Company is expected to result in conservation of energy consumed and reduction in power and fuel charges.

Corporate Governance

The company has complied with the provisions of the Clause 49 of the Listing Agreement related to Corporate Governance except for placing of subsidiary details before Board & Audit Committee during September & December, 2011 quarter and the same were placed before the Audit committee & Board along with Audited Financial Results for March, 2012. Certificate from the Auditor is enclosed and forms part of the Annual Report.

Management Discussion and Analysis Report

Management Discussion and Analysis Report, as required under the Listing Agreement with the Stock Exchange is enclosed and forms part of Annual Report.

Directors Responsibility Statement

Your Directors wish to inform that the Audited Accounts contains Financial Statements for the financial year ended 31st March, 2012 are in full conformity with the requirements of the Companies Act, 1956. They believe that the Financial Statements reflect fairly the form and substance of transaction carried out during the year and reasonably present your Company's financial conditions and result of operations.

Your Directors further confirm that in preparation of the Annual Accounts:

- The applicable accounting standards had been followed and wherever required, proper explanations relating to material departures have been given;

- The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

- Proper and sufficient care has been taken for the 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;

- The Accounts have been prepared on a "going concern" basis.

Acknowledgement and Appreciation

Your Directors would like to thank Company's Bankers - State Bank of India, Export & Import Bank of India, DBS Bank & IDBI Bank for their continued support and they would also like to express their gratitude for the co-operation and assistance extended to the Company by its Customers, Suppliers, Technical Consultants, Contractors, Government and Local Authorities, etc. The Directors also wish to thank all its Shareholders for their unstinted support. The Directors would like to sincerely thank and place on record their appreciation of the consistent and dedicated services of the employees at all levels who have immensely contributed to the performance of the Company during the preview under review.

On behalf of the Board of Directors For Bafna Pharmaceuticals Limited

Paras Bafna Bafna Mahaveer Chand

Whole Time Director Chairman & Managing Director

Place: Chennai

Date : 30.05.2012


Mar 31, 2010

The Directors have pleasure in presenting the Fifteenth Annual Report of your Company together with Audited Accounts for the Financial Year ended 31St March, 2010.

Financial Performance:

The summarized Audited Financial Results for the year ended 31st March, 2010 along with comparative figures for the

previous year is as under: In INR lakhs

Particulars 2009 2010

Total income 4525.20 760O.05

Total Expenditure 4140.51 7029,74

Profit before Depreciation & Taxation 384.69 570.31

Less: Depreciation 137.16 173.79

Profit before Tax 247.53 396.52

Less: Provision for Taxation 28.31 50.40

Less: FBT 1.30 -

Less: Provision for Deferred Tax 111,17 97.98

Profit after Tax for the year 106.75 248.13



The companys revenue for the FY 10 is Rs. 76-00 crore as against Rs. 45.25 crore in FY 09 registering a YOY growth of 68%. The companys performance for this financial year is a clear indicator of the growth path that the company plans to achieve in the coming years. The revenue from UK market has contributed significantly to the growth in the revenue. The current 11 site variation approvals and the 6 in pipeline will continue to support this trend.

Awards and Achievements:

* International Organization for Standardization (ISO) certification renewed to ISO 9001:2008

* Indian Drug Manufacturers Association (IDMA) has Awarded Golden Quality Excellence Award 2009 for its Grantlyon Unit. World Health Organization (WHO) - GMP certificate has been Renewed

* Successful inaugural of Research & development wing on April 26th 2010

Fixed Deposits;

Your Company has not accepted any deposits from the public during the year under report.

Compliance Certificate:

As the Company has a Company Secretary in whole time employment, your company is not required to obtain Compliance Certificate in terms of Section 383(A) of the Companies Act, 1956.

Dividend:

Considering the resource requirements for the planned activities particularly Capital expenditures and product application for export, the company wishes to conserve the resources and so your Directors do not recommend any dividend for the Financial Year

Listing:

The Company Shares are listed at Bombay Stock Exchange Limited and the necessary listing fees have been paid to the stock exchange.

Depository System:

Companys Shares are under compulsory demat mode and members are requested to dematerialize their shares for operational convenience.

Directors:

Directors, Shri A. Sahasranaman and Shri R. Dwarakanathan, retire by rotation. They being eligible, seek reappointment.

The Board of Directors at their Meeting held on 26.04.2010 had re-appointed Shri Bafna Mahaveer Chandas Managing Director w.e.f 01,07.2010 and the Shareholders approval for his re-appointment is being sought at this General Meeting.

The Board of Directors at their Meeting held on 26.04.2010 had re-appointed Shri Paras Bafna as Whole Time Director w.e.f. 01.07.2010 and the Shareholders approval for his re-appointment is being sought at this General Meeting.

Auditors:

M/s. Abhay Jain & Co., Chartered Accountants, Chennai, the auditors of the Company retire at the conclusion of the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. The replies to the observations of the Audit report are

SI No Particulars Reply 1 Point no(l)(a) of Annexure to Audit Report The company has updated the same subsequently*

2 Point no, 3(b) of Notes to Accounts The company is taking steps to comply with the provi sions of the Gratuity Act.

Particulars of Employees:

There are no employees covered under the provisions of section 217(2A) of the Companies Act, 1956 and the Rules made there under. Therefore a statement giving particulars of employees in pursuance to the above referred section is not enclosed.

Foreign Exchange:

Your Company earned foreign exchange of Rs.2293.62 lakhs (previous year Rs.1285.57 lakhs) from exports and the foreign exchange outgo was Rs 164.67 lakhs (previous year Rs.117.42 lakhs) on account of international travel and purchase of foreign currency during the year ended 31st March, 2010.

Human Resources, Industrial Relations, Environment, Occupational Health and Safety:

The directors would like to thank the employees for their constant support and contribution to the growth of the company, Continuous initiatives are undertaken to improve the support systems for better Human Resource management to face the challenges that may erupt during the robust growth phase of the company- The company enjoys good industrial relations in the areas, where the facilities and offices are situated. Also, the manufacturing units comply with all relevant government regulations relating to Environment, Safety and Health. We would like to add that no major incidents have occurred at any of our plants that have led to any environmental liabilities.

As on 31st March, 2010 the number of employees were 267 which includes managerial staff.

Conservation of Energy:

The Company is conscious of its responsibility to conserve the energy and has taken measures in relation to conservation of energy and technology absorption, for instance, the steam boilers and the use of certain drying system are used to conserve energy and reduce the fuel consumption during production.

Corporate Governance:

The company has complied with the provisions of Clause 49 of the listing agreement related to Corporate Governance* This Annual Report carries a Section on the Corporate Governance and compliances. (Enclosed as Annexure 1).

Directors Responsibility Statement:

Your Directors wish to inform that the Audited Accounts contains Financial Statements for the financial year ended 315t March, 2010 are in full conformity with the requirements of the Companies Act, 1956. They believe that the Financial Statements reflect fairly the form and substance of transactions carried out during the year and reasonably present your Companys financial conditions and results of operations.

Your Directors further confirm that in preparation of the Annual Accounts,

* the applicable accounting standards had been followed and wherever required, proper explanations relating to material departures have been given,

* the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period,

* proper and sufficient care has been taken for the 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,

* the Accounts have been prepared on a "going concern" basis.

Acknowledgement and Appreciation:

Your Directors would like to thank Companys Bankers - State Bank of India, for their continued support and they would also like to express their gratitude for the co-operation, and assistance extended to the Company by its Customers, Suppliers, Technical Consultants, Contractors, Government and Local Authorities etc.,. The Directors also wish to thank all its Shareholders for their unstinted support- The Directors would like to sincerely thank and place on record their appreciation of the consistent and dedicated services of the employees at all levels who have immensely contributed to the performance of the Company during the year under review.

On behalf of the Board of Directors for

Bafna Pharmaceuticals Limited

Bafna Mahaveer Chand

Chairman & Managing Director

Date:28/05/2010

Place: Chennai

 
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