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Directors Report of Celestial Biolabs Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Seventeenth Annual Report of your Company along with the audited Statement of Accounts for the financial year ended 31st March 2015. The Report also includes the Management Discussion and Analysis Report in accordance with the Guidelines on Corporate Governance and consolidated Financial Statements.

The highlights of the financial results for the year 2014-15 in comparison to the year 2013-14 are as follows:

(Rs.In Lakhs)

Particulars 2014-15 2013-14

Sales 2745.07 2350.34

Profit before Depreciation 828.81 553.48

Depreciation 705.89 498.23

Profit Before Tax 122.92 55.25

Deferred Tax (30.11) (39.68)

Provision for MAT 23.43 10.53

Provision for FBT NIL NIL

Net Profit for the year 129.60 84.40

Profit & Loss Account balance brought forward 2261.48 2185.52

Dividend NIL NIL

Corporate Dividend Tax NIL NIL

Performance

We have been able to achieve a turnover of Rs. 2745.07 Lacs. The percentage increase in the turnover is 17% and increase in net profit is 54% respectively when compared to that of previous year.

Future Outlook

Celestial has already launched Coalmine Gae (a drug to treat arthritis) in collaboration with CMFRI Cochin(a prestigious ICAR Institute). Coalmine anti-diabities natural drug shall be launched shortly Celestial plans to advertise these two product in addition to biovita ( A natural health Drink) and trem ( A fairness herbal cream) in the leading newspaper in ten states to increase the business volume.

Dividend:

The Company has not declared any dividend during the year.

Corporate Governance:

As per Clause 49 of the Listing Agreement with the Stock exchanges, a separate section on Corporate Governance is enclosed herewith which forms part of the Annual Report. A certificate from the Auditors of the Company on compliance with the conditions of Corporate Governance as stipulated under the Clause 49 of the Listing Agreement is annexed to this Report.

Management Discussion and Analysis:

A detailed section of the Management Discussion and Analysis for the period under review as required under Clause 49 of the Listing Agreement is given as a separate statement forming part of the Annual Report.

Directors' Responsibility Statement:

Pursuant to the requirement under Section 134 of the Companies Act, 2013 with respect to the Director's Responsibility Statement, it is hereby confirmed. i. that in the preparation of the accounts for the financial year ended 31st March 2015, the applicable accounting standards have been followed along with proper explanations for marking all departures, if any. ii. that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as 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 or loss of the company for the year under review. iii. that the directors have taken proper and sufficient care 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 from preventing and detecting fraud and other irregularities.

iv. that the directors have prepared the accounts for the financial year ended 31st March 2015 on a going concern basis v. the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and vi. the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively Directors & Key Managerial Personnel (KMP) Directors

In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Smt. Padma Singh retired by rotation and being eligible has offered herself for re-appointment. During the period under review, Dr. Sivakumar Bhattiprolu, Director resigned from the Board with effect from 15.11.2014. The Board places on record his appreciation and gratitude for his guidance and contribution during his association with the Company.

Key Managerial Personnel

The company is taking steps to appoint Key Managerial Personnel as required under Section.203 of the Companies Act, 2013

Declaration from Independent directors on Annual Basis

Pursuant to the provisions of Section 149 of the Act, which came into effect from April 1, 2014, Dr.Jeetainder Roy Gour (DIN 02810147) and Dr. D C Sastri (DIN 02682897) were appointed as independent directors at the annual general meeting of the Company held on November 15th, 2014. The terms and conditions of appointment of independent directors are as per Schedule IV of the Act. They have submitted a declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as independent director during the year

Number of meetings of the board Seven meetings of the board were held during the year. For details of the meetings of the board, please refer to the corporate governance report, which forms part of this report

Board Evaluation

The board of directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India ("SEBI") under Clause 49 of the Listing Agreements ("Clause 49"). The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The Board and the Nomination and Remuneration Committee ("NRC") reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role. In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual directors was also discussed.

Policy on directors' appointment and remuneration and other details

The Company's policy on directors' appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the corporate governance report, which forms part of the directors' report Disclosure as required under Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014

The Disclosure as required under Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is given in Annexure - A to the Board Report.

Particulars of contracts or arrangements with related parties referred in Sub - Section (1) of Section 188 Details of transactions with related parties falling under the scope of Section 188(1) of the Act & Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 (Form No. AOC.2) is given in Annexure - B to the Board Report.

Auditors

Pursuant to the provisions of Section 139 of the Act and the rules framed there under, M/s Lakshmi Purna & Associates, Chartered Accountants, were appointed as statutory auditors of the Company from the conclusion of the sixteenth annual general meeting (AGM) of the Company held on November 15, 2014 till the conclusion of the ninteenth Annual General Meeting to be held in the year 2017, subject to ratification of their appointment at every AGM.

Secretarial Auditor

Pursuant to the provisions of Section 204 of the Act and the rules framed there under, M/s.GMVDR & Associates, Company Secretaries were appointed as Secretarial Auditors of the Company and the Secretarial Audit Report issued by them for the financial year 2014-15 is made a part of this Report.

Cost Audit

Cost Audit for financial year 2014-15 is not applicable in view of the Cost Audit Amendment Rules, 2014, Government of India, Ministry of Corporate Affairs, Notification, New Delhi, dated 31.12.2014

Extract of the annual return of the Company

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

Qualifications in Auditors' report and secretarial auditors' report

The auditors' report does not contain any qualifications, reservations or adverse remarks. Replies to qualifications in Secretarial Audit Report are annexed to this report.

Particulars of loans, guarantees or investments

The particulars of loans, guarantees and investments have been disclosed in the financial statements

Material changes and commitments if any affecting the financial position of the company

There are no material changes and commitments affecting the financial position of the Company from the date of closure of financial year to the date of Board Report.

Charges

The Company has not availed loans from any Bank / Financial Institutions during the financial year under review.

Fixed Deposits

The Company has not accepted any fixed deposits during the year under review. As such no amount of principal or interest was outstanding on the date of the Balance Sheet.

Unpaid / Unclaimed Dividend

Dividend which is unclaimed for a period of 7 years shall be transferred to Investor Education & Protection Fund (IEPF).

Internal Control

Your Company has established a robust system of internal controls to ensure that assets are safeguarded and transactions are appropriately authorized, recorded and reported. The Audit Committee of the Board addresses significant issues raised by both, the Internal Auditors and the Statutory Auditors. The Company believes that the overall internal control system is dynamic and reflects the current requirements at all times, hence ensuring that appropriate procedures and controls, in operating and monitoring practices are in place. Your Company is proactively identifying the areas for further improvement which shall remain an ongoing process.

Risk Management

The Board of the Company has formed a risk management committee to frame, implement and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The development and implementation of risk management policy has been covered in the management discussion and analysis, which forms part of this report.

Vigil Mechanism

Your Company has adopted a Whistle Blower Policy to report to the management about instances of unethical behaviours, actual or suspected fraud or violation of the Company's code of conduct or ethics policy. Under the policy, the employees can approach Company's Ethics Counsellor/ Chairman of Audit Committee directly.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo:

Additional information on conservation of energy, technology absorption and foreign exchange earnings and outgo as required to be disclosed in terms of Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is given in Annexure - D and forms part of this report.

Employee Relations

During the year under review, the company has enjoyed cordial relationship with all section of employees. The company believes that the employees play a vital role in increasing the turnover and profitability of the company and the strength of the company lie in harnessing the manpower in achieving sustained long-term growth in all spheres.

Acknowledgements

Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your company wishes to place on record its appreciation of employees at all levels for their dedicated contribution towards growth of the company.

For and on behalf of the Board of Directors

For Celestial Biolabs Limited

Place: Hyderabad Dr A N Singh

Date : 22.10.2015 (Chairman & Managing Director)

DIN: 01756827


Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Sixteenth Annual Report of your Company along with the audited Statement of Accounts for the financial year ended 31st March 2014. The Report also includes the Management Discussion and Analysis Report in accordance with the Guidelines on Corporate Governance and consolidated Financial Statements. The highlights of thefinancial results for the year 2013-14 in comparison to the year 2012-13 are as follows:

(Rs. In Lakhs)

Particulars 2013-14 2012-13

Sales 235034 2119.55

Profit before Depreciation 553.48 504.38

Depreciation 498.23 473.23

Profit Before Tax 55.25 31.15

Deferred Tax (39.68) (45.64)

Provision for MAT 10.53 5.94

Provision for FBT NIL NIL

Net Profit for the year 84.40 70.85

Profit & Loss Account balance brought forward 2185.52 2121.75

Dividend NIL NIL

Corporate Dividend Tax NIL NIL

Performance

We have been able to achieve a turnover of Rs. 2350.34 Lacs. The percentage increase in the turnover is 11% and increase in net profit is 19% respectively when compared to that of previous year.

Future Outlook:

We have 55 approved herbal formulations and we are in the process of validating our efficacy claim by introducing Animal model preclinical and clinical research trail as applicable by regulatory authorities. We have already started making effort to take our most of the products to OTC route so that our products can be available and taken across retail counters in India.. Our objective is to introduce at least one Research product every year in the market. Cadalmin Gae to treat Arthritis has already been launched in Indian market and we have extremely good response from the consumers

Corporate Governance:

As per Clause 49 of the Listing Agreement with the Stock exchanges, a separate section on Corporate Governance is enclosed herewith which forms part of the Annual Report. A certificate from the Auditors of the Company on compliance with the conditions of Corporate Governance as stipulated under the Clause 49 of the Listing Agreement is annexed to this Report.

Management Discussion and Analysis:

A detailed section of the Management Discussion and Analysis for the period under review as required under Clause 49 of the Listing Agreement is given as a separate statement forming part of the Annual Report.

Employee Relations:

During the year under review, the company has enjoyed cordial relationship with almost all section of employees. The company believes that the employees play a vital role in increasing the turnover and profitability of the company and the strength of the company lie in harnessing the manpower in achieving sustained long-term growth in all spheres. Retaining Good and Efficient manpower is an challenge and management has decided to offer company shares to the employees by taking a view of their contribution and Nos of years they have served the company. The company is also planning to reward its business associates who are with the company from longer duration.

Corporate Social responsibility

Through the years, Celestial Biolabs Limited has strived to make the world around it a better place. Corporate Social Responsibility (CSR) is an integral part of our business. The Company undertakes all its operations with a high concern and sincerity for environment and its surroundings as well as the safety and health of people. Apart from regular medical initiatives, we have also been working in the domain of rural development. It works closely towards the development of society, in line with its philosophy of creating happier and healthier society. The Company regularly takes initiatives in providing medicines at free of cost to the poor villagers. The company conducting this program with the help of AWAKE RESEARCH AND SERVICE FOUNDATION an voluntary service organization that create awareness about health and water and energy conservation among the people

Directors:

a. Dr B Siva Kumar retired by rotation and he expressed his un willing ness to be re-appointed. Hence the shareholders may decide on the vacancy caused.

b. Pursuant to Section 149(4) of the Companies Act, 2013, it is proposed that Dr. Jeetainder Roy Gour be appointed as Independent Director with effect from 1-4-2014 and shall hold office up to 31-03-2019. The company has received requisite notice for the Director in writing from members proposing his name as Independent Director. The company has received declaration from the Independent Director of the company confirming that he meet the criteria of independence as prescribed under Sub Section 5 of Section 149 of Companies Act, 2013

c. Pursuant to Section 149(4) of the Companies Act, 2013, it is proposed that D C Sastri be appointed as Independent Director with effect from 15.11-2014 and shall hold office up to 14.11-2019. The company has received requisite notice for the Director in writing from members proposing his name as Independent Director. The company has received declaration from the Independent Director of the company confirming that he meet the criteria of independence as prescribed under Sub Section 5 of Section 149 of Companies Act, 2013

Auditors:

The existing Statutory Auditors, M/s. Lakshmi Purna & Associates, Chartered Accounts retire at the ensuing Annual General Meeting and has confirmed their eligibility and willingness to accept office, if re-appointed.

Internal Control Systems:

Your Company has established a robust system of internal controls to ensure that assets are safeguarded and transactions are appropriately authorized, recorded and reported. The Audit Committee of the Board addresses significant issues raised by both, the Internal Auditors and the Statutory Auditors. The Company believes that the overall internal control system is dynamic and reflects the current requirements at all times, hence ensuring that appropriate procedures and controls, in operating and monitoring practices are in place. Your Company is proactively identifying the areas for further improvement which shall remain an ongoing process.

Directors'' Responsibility Statement:

Pursuant to the requirement under section 217 (2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility statement, it is hereby confirmed.

i. that in the preparation of the accounts for the financial year ended 31st March 2014, the applicable accounting standards have been followed along with proper explanations for marking all departures, if any. ii. that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as 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 or loss of the company for the year under review. iii. that the directors have taken proper and sufficient care 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 from preventing and detecting fraud and other irregularities. iv. that the directors have prepared the accounts for the financial year ended 31st March 2014 on a going concern basis.

Particulars of employees

The Information required under section 217(2A) of the Companies Act, 1956 read with the companies (Particulars of Employees) (Amendment ) Rules 2002, be treated as NIL as none of the employees of the company draw remuneration in excess of Rs.5,00,000 P.M.

Fixed deposits

The Company has not accepted any deposits within the meaning of Section 58A of the Companies Act 1956 and the Rules made there under.

Acknowledgments

Your Company places on record their appreciation of the continued support and co-operation received from Government of Andhra Pradesh, State Bank of India and ICICI Bank Limited for their kind cooperation. Your company also thanks vendors, customers, consultants, auditors and other who have been assisting and guiding the company in various facts of operation. Your company wishes to place on record its appreciation of employees at all levels for their dedicated contribution towards growth of the company.

For and on behalf of the Board of Directors

Place: Hyderabad Dr A N Singh Date : 14.10.2014 (Chairman & Managing Director) DIN: 01756827


Mar 31, 2013

Dear Members,

The Directors have pleasure in presenting the Fifteenth Annual Report of your Company along with the audited Statement of Accounts for the financial year ended 31st March 2013. The Report also includes the Management Discussion and Analysis Report in accordance with the Guidelines on Corporate Governance and consolidated Financial Statements.

The highlights of the financial results for the year 2012-13 in comparison to the year 2011-12 are as follows:

(Rs. In Lakhs)

Particulars 2012-13 2011-12

Sales 2119.55 2102.20

Profit before Depreciation 504.38 401.71

Depreciation 473.23 373.30

Profit Before Tax 31.15 28.41

Deferred Tax (45.64) (70.67)

Provision for MAT 5.94 7.57

Provision for FBT NIL NIL

Net Profit for the year 70.85 91.51

Profit & Loss Account balance brought forward 2121.75 2039.39

Dividend NIL NIL

Corporate Dividend Tax NIL NIL



Performance

We have been able to achieve a turnover of Rs.2119.55 Lacs. The percentage increase in the turnover is 3% and decrease in net profit is 17% respectively when compared to that of previous year. The Performance has not been satisfactory because of returned stocks and certain bad debts.

Future Outlook:

Although, we have passed through a very tough time, but we have achieved tremendous success in product development, product formulation, standardization etc. Cadalmin introduction in Indian market shall bring the desired result as there is huge demand across India. Every effort is being made to ensure the availability of this product in all the states in India. In view of the need of the products, it has been priced very reasonably so that people can afford to opt for effective treatment. Normally, to treat arthritis. An individual spends on an average of about Rs 5000 to Rs 6000 per month, but cadalmin may cost about Rs 1200/ per month. This product do not have any side effect and the improvement shall be visible from first month of usage. The company is very confident of building a very decent business volume in due course of time..Our effort shall be to penetrate in south east Asian and African market with Cadalmin and Biovita very soon.

Corporate Governance:

As per Clause 49 of the Listing Agreement with the Stock exchanges, a separate section on Corporate Governance is enclosed herewith which forms part of the Annual Report. A certificate from the Auditors of the Company on compliance with the conditions of Corporate Governance as stipulated under the Clause 49 of the Listing Agreement is annexed to this Report.

Management Discussion and Analysis:

A detailed section of the Management Discussion and Analysis for the period under review as required under Clause 49 of the Listing Agreement is given as a separate statement forming part of the Annual Report.

Employee Relations:

During the year under review, the company has enjoyed cordial relationship with almost all section of employees. The company believes that the employees play a vital role in increasing the turnover and profitability of the company and the strength of the company lie in harnessing the manpower in achieving sustained long-term growth in all spheres. Retaining Good and Efficient manpower is an challenge and management has decided to offer company shares to the employees by taking a view of their contribution and Nos of years they have served the company. The company is also planning to reward its business associates who are with the company from longer duration.

Sweat Equity Shares:

It is proposed to allot Sweat Equity shares to Dr.A.N Singh for the balance amount of Rs.4.91 crores (approx.)

Corporate Social responsibility

Through the years, Celestial Biolabs Limited has strived to make the world around it a better place. Corporate Social Responsibility (CSR) is an integral part of our business. The Company undertakes all its operations with a high concern and sincerity for environment and its surroundings as well as the safety and health of people. Apart from regular medical initiatives, we have also been working in the domain of rural development. It works closely towards the development of society, in line with its philosophy of creating happier and healthier society. The Company regularly takes initiatives in providing medicines at free of cost to the poor villagers. The company conducting this program with the help of AWAKE RESEARCH AND SERVICE FOUNDATION an voluntary service organization that create awareness about health and water and energy conservation among the people

Directors:

Smt. Padma Singh retired by rotation and being eligible has offered herself for re-appointment. The brief profiles of the director seeking appointment/reappointment at the ensuing Annual General Meeting are presented in the Annual Report.

Auditors:

The existing Statutory Auditors, M/s. Lakshmi Purna & Associates, Chartered Accounts retire at the ensuing Annual General Meeting and has confirmed their eligibility and willingness to accept office, if re-appointed.

Internal Control Systems:

Your Company has established a robust system of internal controls to ensure that assets are safeguarded and transactions are appropriately authorized, recorded and reported. The Audit Committee of the Board addresses significant issues raised by both, the Internal Auditors and the Statutory Auditors. The Company believes that the overall internal control system is dynamic and reflects the current requirements at all times, hence ensuring that appropriate procedures and controls, in operating and monitoring practices are in place. Your Company is proactively identifying the areas for further improvement which shall remain an ongoing process.

Directors'' Responsibility Statement:

Pursuant to the requirement under section 217 (2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility statement, it is hereby confirmed.

i. that in the preparation of the accounts for the financial year ended 31st March 2013, the applicable accounting standards have been followed along with proper explanations for marking all departures, if any.

ii. that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as 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 or loss of the company for the year under review.

iii. that the directors have taken proper and sufficient care 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 from preventing and detecting fraud and other irregularities.

iv. that the directors have prepared the accounts for the financial year ended 31st March 2013 on a going concern basis.

Particulars of employees

The Information required under section 217(2A) of the Companies Act, 1956 read with the companies (Particulars of Employees) (Amendment ) Rules 2002, be treated as NIL as none of the employees of the company draw remuneration in excess of Rs.5,00,000 P.M.

Fixed deposits

The Company has not accepted any deposits within the meaning of Section 58A of the Companies Act 1956 and the Rules made there under.

Acknowledgements

Your Company places on record their appreciation of the continued support and co-operation received from Government of Andhra Pradesh, State Bank of India and ICICI Bank Limited for their kind cooperation. Your company also thanks vendors, customers, consultants, auditors and other who have been assisting and guiding the company in various facts of operation.

Your company wishes to place on record its appreciation of employees at all levels for their dedicated contribution towards growth of the company.



For and on behalf of the Board of Directors

Place: Hyderabad Dr A N Singh

Date: 14.08.2013 (Chairman & Managing Director)


Mar 31, 2012

Dear Members,

The Directors have pleasure in presenting the Fourteenth Annual Report of your Company along with the audited Statement of Accounts for the financial year ended 31st March 2012. The Report also includes the Management Discussion and Analysis Report in accordance with the Guidelines on Corporate Governance and consolidated Financial Statements.

The highlights of the financial results for the year 2011-12 in comparison to the year 2010-11 are as follows:

(Rs. In Lakhs)

Particulars 2011-12 2010-11

Sales 2102.20 2532.86

Profit before Depreciation 401.71 592.71

Depreciation 373.30 315.51

Profit Before Tax 28.41 278.79

Deferred Tax (70.67) (20.22)

Provision for MAT 7.57 56.86

Provision for FBT NIL NIIL

Net Profit for the year 91.51 242.15

Profit & Loss Account balance brought forward 2039.39 1821.46

Dividend NIL NIL

Corporate Dividend Tax NIL NIL

Performance

We have been able to achieve a turnover of Rs.2102.20 Lakhs. The percentage decrease in the turnover is 17% and decrease in net profit is 62% respectively when compared to that of previous year. The Performance has not been satisfactory because of returned stocks and certain bad debts.

Future Outlook:

The company Products have been very well accepted in 8 states of Indian market. Products in the categories of Herbal, Allopathic and Feed supplements of Alpha amylase and Phytase combinations have created very good demand among users. Our products like Biovita, Celdigest, Rhumacel, Bioliv, Celclear, Gynocel, O-kof, C-kaps, Trem and Relifin in Herbal range and Equibact, Kcvin-500, Nitfur-SR, Entilin,Cel- D-Zyme, Knitcream and Lysirin in allopathic range and Celzyme phytase, Celzyme-MLBP and Celzyme- CELCAF in Enzyme Feed supplement have created very positive impact in the market. We are making every effort to meet the demand and trying to expand in all the states to increase the volume and capture a healthy market share.

We are also trying to modify, revamp and update, healthcare portal Celsanjeevani and also Healthcare ERP products to increase online and offline sale of Software and healthcare products. The company shall be immensely benefitted with these updated versions. Our Corporate and product development facility at Nacharam ( Hyderabad city) is operational and we are likely to increase the working strength in Celsanjeevani.

Our Production facility at Genome valley shall be operational by Nov- December 2012 and we are arranging suitable resources to complete the facility. This facility shall be one of the best in Andhra Pradesh to accommodate Biopharmaceuticals formulations. After the facility is ready, importers from African countries as well as south East Asian countries shall validate our production facility and Export of formulations will commence and thus our volume and profitability shall increase.

Corporate Governance:

As per Clause 49 of the Listing Agreement with the Stock exchanges, a separate section on Corporate Governance is enclosed herewith which forms part of the Annual Report. A certificate from the Auditors of the Company on compliance with the conditions of Corporate Governance as stipulated under the Clause 49 of the Listing Agreement is annexed to this Report.

Management Discussion and Analysis:

A detailed section of the Management Discussion and Analysis for the period under review as required under Clause 49 of the Listing Agreement is given as a separate statement forming part of the Annual Report.

Employee Relations:

During the year under review, the company has enjoyed cordial relationship with almost all section of employees. The company believes that the employees play a vital role in increasing the turnover and profitability of the company and the strength of the company lie in harnessing the manpower in achieving sustained long-term growth in all spheres. Retaining Good and Efficient manpower is an challenge and management has decided to offer company shares to the employees by taking a view of their contribution and Nos of years they have served the company. The company is also planning to reward its business associates who are with the company from longer duration and are likely to contribute in the growth of the company.

Corporate Social responsibility

The company also decided to distribute some medicines free of cost to poor villagers who cannot afford to buy the essential medicines. The company shall be distributing through AWAKE RESEARCH and SERVICE FOUNDATION an voluntary service organization that create awareness about health and water and energy conservation among the people.

Directors:

Dr D C Sastry has resigned from the Board of the Company in the Board meeting held on 03.09.2012. Dr. B. Siva Kumar and Dr. Jeetainder Roy Gour, retire by rotation and being eligible have offered themselves for re-appointment. The brief profiles of the director(s) seeking appointment/reappointment at the ensuing Annual General Meeting are presented in the Annual Report.

Auditors:

The existing Statutory Auditors, M/s. Lakshmi Purna & Associates, Chartered Accounts retire at the ensuing Annual General Meeting and has confirmed their eligibility and willingness to accept office, if re-appointed.

Registered office of the Company:

The Company has shifted its registered office from Banjara Hills to Tech park of IDA Nacharam wherein it has its own premises during the financial year under consideration.

Internal Control Systems:

Your company has well-established procedures for internal control system commensurate with its size and operations. The organization is adequately staffed with qualified and experienced personnel for implementing and monitoring the internal control environment.

Directors' Responsibility Statement:

Pursuant to the requirement under section 217 (2AA) of the Companies Act, 1956, with respect to Directors' Responsibility statement, it is hereby confirmed.

i. That in the preparation of the accounts for the financial year ended 31st March 2012; the applicable accounting standards have been followed along with proper explanations for marking all departures, if any.

ii. That the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as 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 or loss of the company for the year under review.

iii. That the directors have taken proper and sufficient care 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 from preventing and detecting fraud and other irregularities.

iv. That the directors have prepared the accounts for the financial year ended 31st March 2012 on a going concern basis.

Particulars of employees

The Information required under section 217(2A) of the Companies Act, 1956 read with the companies (Particulars of Employees) (Amendment ) Rules 2002, be treated as NIL as none of the employees of the company draw remuneration in excess of Rs.5,00,000 P.M.

Fixed deposits

The Company has not accepted any deposits within the meaning of Section 58A of the Companies Act 1956 and the Rules made there under.

Acknowledgements

Your Company places on record their appreciation of the continued support and co-operation received from Government of Andhra Pradesh, State Bank of India and ICICI Bank Limited for their kind cooperation. Your company also thanks vendors, customers, consultants, auditors and other business associates who have been assisting and guiding the company in various facts of operation.

Your company wishes to place on record its appreciation of employees at all levels for their dedicated contribution towards growth of the company.

For and on behalf of the Board of Directors

Place: Hyderabad Dr A N Singh

Date: 03.09.2012 (Chairman & Managing Director)


Mar 31, 2010

The Directors have pleasure in presenting the Twelfth Annual Report of your Company along with the audited Statement of Accounts for the financial year ended 31st March 2010. The Report also includes the Management Discussion and Analysis Report in accordance with the Guidelines on Corporate Governance and consolidated Financial Statements.

The highlights of the financial results for the year 2009-10 in comparison to the year 2008-09 are as follows:

(Rs. In Lakhs)

Particulars 2009-10 2008-09

Sales 2183.41 1925.10

Profit before Depreciation 315.88 626.12

Depreciation 50.20 27.40

Profit Before Tax 265.68 598.71

Deferred Tax 6.87 2.97

Provision for MAT 38.87 67.83

Provision for FBT Nil 2.85

Net Profit for the year 233.69 531.00

Profit & Loss Account balance brought

forward 1821.46 1611.14

Dividend Nil 55.97

Corporate Dividend Tax Nil 9.51

Future Outlook

The sale of herbal and synthetic products have already been established and enzyme marketing net work is being created. Nutraceuticals formulations with the composition of natural products, herbal and enzymes have been completed and production is in progress. Nutraceuticals shall be marketed in India and overseas. The company is also looking to diversify the services in healthcare domain in India and USA. Research Products in cosmetic range to take care of Vitiligo, anti wrinkles and Tan shall be lunched shortly.

Transfer of IPRs - allotment of Sweat Equity Shares and Listing of the same

During the period under review DrAN.Singh was allotted 5,89,000 equity shares of Rs.10/- each (as first tranche) for transfer of the ownership rights of the Intellectual Property Assets developed and owned by him to the Company after obtaining the consent of members in the postal ballot. These shares were listed on The National Stock Exchange of India w.e.f 2nd July 2010 and Mumbai Stock Exchange w.e.f 5th July 2010.

The IPRs transferred to the company has generated revenue of Rs 5.75 crores till 31st march 2010 and after upgradation of the products approximate revenue expected are about Rs 15 crore in next 5years.

Patents The following patents under the herbal and enzyme formulation category had been filed with the Chennai Patent Office.

1. Novel lipase from mutated a strain - the lipases are enzymes used in oil processing, detergents, diagnostics etc. The present funding will provide and unique combination to her a major positive impact in detergent industry.

2. A combinatorial synergistic formulation for the treatment of generalized stable jeucoderma comprisin - A unique product to take care of vitiligo patients.

3. A cream using a peptide and phyto chemicals formation for improving the skin tan.

4. Production of cellulose from aspergillus sp. Rcal5 for Biopolishing, bioscouring and denim fading fo.

5. Cel-Digest- It is in unique herbal based formulation and composition to improve the digestion in human.

6. Term Plus-A natural breakthrough in complexion.

7. Infantaal Syrup - A polyherbal formulation for toning up of overall growth and strengthening immunity in children.

8. O-Kof Syrup -A polyherbal composition for relief from bronchial congestion, nasal blocks.

The patents which are in pipeline (1) Venti layer (2) Bio-power (3) Bio-vita (4) Bio-sleep (5) Hemo-plus (6) Lung-care (7) Cardio-care (8) Kidney-care (9) Neuro-care and few other nutraceuticals.

Corporate Governance

As per Clause 49 of the Listing Agreement with the Stock exchanges, a separate section on Corporate Governance is enclosed herewith which forms part of the Annual Report. A certificate from the Auditors of the Company on compliance with the conditions of Corporate Governance as stipulated underthe Clause 49 of the Listing Agreement is annexed to this Report.

Management Discussion and Analysis

A detailed section of the Management Discussion and Analysis for the period under review as required under Clause 49 of the Listing Agreement, is given as a separate statement forming part of the Annual Report.

Change in the name of the Company

It may be recalled that the Company had obtained the consent of the members in their Extraordinary General Meeting held on 14.12.2009 for changing the name of the Company from"Celestial Labs Limited to Celestial Biolabs Limited." Accordingly the company made an application to the Central Government for effecting the change in the name of the Company. The Registrar of Companies had approved the change in the name w.e.f 23.12.2009.

Increase in the Share Capital of the Company

The Authorised Share Capital of the Company has been enhanced from Rs..14.00 Crores to Rs.17.00 Crores.The paid up capital of the company has been enhanced from Rs.11,19,40,000 to Rs.11,78,30,000 by allotment of 5,89,000 equity shares of Rs.10/- each to Dr A N Singh, Chairman and Managing Director in lieu of compensation for transfer of the ownership rights of the Intellectual Property Assets (Software Programmes-worth of Rs.8.17 Cr.) developed and, owned by him to the Company.

Employee Relations

During the year under review, the company has enjoyed cordial relationship with almost all section of employees. The company believes that the employees play a vital role in increasing the turnover and profitability of the company and the strength of the company lie in harnessing the manpower in achieving sustained long-term growth in all spheres.

Directors

Dr B Siva Kumar and Dr Jeetainder Roy Gour, retire by rotation and being eligible have offered themselves for re-appointment.

The tenure of Dr A N Singh as Chairman & Managing Director of the Company expires on 30.09.2010. Considering the need for his valuable guidance, knowledge and support for the Company to reach the heights of excellence your Board of directors propose his reappointments this annual general meeting.

The brief profiles of the director(s) seeking appointment/reappointment at the ensuing Annual General Meeting are presented in the Annual Report.

Auditors

The existing Statutory Auditors, M/s. G.V. Rao & Company, Chartered Accounts retire at the ensuing Annual General Meeting and has confirmed their eligibility and willingness to accept office, if re-appointed.

Internal Control Systems

Your company has well-established procedures for internal control system commensurate with its size and operations. The organization is adequately staffed with qualified and experienced personnel for implementing and monitoring the internal control environment.

Conservation of Energy, Research, Development and Innovation

Information as required under Section.217 (1)(e) of the Companies Act, 1956 is annexed and forms part of this report

DirectorsResponsibility Statement

Pursuant to the requirement under section 217 (2AA) of the Companies Act, 1956, with respect to Directors Responsibility statement, it is hereby confirmed.

i. that in the preparation of the accounts for the financial year ended 31st March 2010, the,applicable accounting standards have been followed along with proper explanations for marking all departures, if any.

ii. that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as 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 or loss of the company for the year under review.

iii. that the directors have taken proper and sufficient care 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 from preventing and detecting fraud and other irregularities.

iv. that the directors have prepared the accounts for the financial year ended 31 st March 2010 on a going concern basis.

PARTICULARS OF EMPLOYEES

The Information required under section 217(2A) of the Companies Act, 1956 read with the companies (Particulars of . Employees) (Amendment) Rules 2002, be treated as NIL as none of the employees of the company draw remuneration in excess of Rs. 2,00,000 P.M.

FIXED DEPOSITS

The Company has not accepted any deposits with in the meaning of Section 58A of the Companies Act 1956 and the Rules made there under.

Reply to Auditors observations:

Replies of the Company forming part of the Directors Report to the members under Section 217 (3) of the Companies Act 1956.

AUDlTORS QUAUFICATIONS/OBSERVATIONS REPLY BY THE BOARD OF DIRECTORS

UNDER. SECTION. 217 (3)

The internal control procedures are not adequate The Management is taking necessary measures to improve

commensurate with the size of company and nature of its the internal control procedures and have assigned the

business for the purchase of store, raw materials including internal audit to Mr Pavan Kumar CA components, plant and Machinery, equipment and other assets and for the sale of goods, the management needs to strengthen the internal control system.

Acknowledgement

Your Company places on record their appreciation of the continued support and co-operation received from Government of Andhra Pradesh, State Bank of India and ICICI Bank Limited for their kind cooperation. Your company also thanks vendors, customers, consultants, auditors and other who have been assisting and guiding the company in various facts of operation,

Your company wishes to place on record its appreciation of employees at all levels for their dedicated contribution towards growth of the company.

For and on behalf of the Board of Directors

Place: Hyderabad Dr A. N.Singh

Date: 12.08.2010 (Chairman & Managing Director)



 
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