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Directors Report of Kilitch Drugs(I) Ltd.

Mar 31, 2023

The Board of Directors take pleasure in presenting 31^st Annual Report on the business and operations of Kilitch Drugs (India] Limited ("the Company"] along with its standalone and consolidated financial statements for the financial year ended 31^st March, 2023

1. Financial Performance (Standaloneand Consolidated):

Key highlights of standalone and consolidated financial performance for the year ended 31^st March, 2023 are summarized asunder:

[Rs. in Lakhs]
Particulars	Standalone		Consolidated
	2022-23	2021-22	2022-23	2021-22
Revenue from Operations	11,778.35	10,515.98	13,959.90	11,423.42
Other Income	459.76	455.90	291.80	290.93
Total Income	12,238.11	10,971.88	14,251.70	11,714.35
Total Expenses	10,293.25	9,579.06	13,050.27	10,752.91
Profit/(Loss) before exceptional and extraordinary items and tax	1,944.86	1,392.82	1,201.43	961.44
Exceptional Items	-	-	-	-
Profit/(Loss) before tax from continuing operation	1,944.86	1,392.82	1,201.43	961.44
Tax Expenses
- Current Tax	419.76	363.37	419.76	363.37
- Deferred Tax	(46.63]	(23.32]	(46.60]	(23.30]
Net Profit/(Loss) continuing operations	1,571.73	1,052.77	828.27	621.37
Other Comprehensive Income (after tax]	(31.75]	198.15	(31.75]	198.15
Total Comprehensive Income	1,539.98	1,250.92	796.52	819.52
Paid up Equity Share Capital (Face Value Rs. 10/- per Share]	1,558.23	1,558.23	1,558.23	1,558.23
Earnings per share (Amount in Rs.]
- Basic	10.09	6.76	6.71	4.73
- Diluted	10.09	6.76	6.71	4.73

2. State of Co m pa nyâs Affai rs

The financial statements for the year ended 31^st March, 2023 has been prepared in accordance with the Indian Accounting Standards (IndAS) notified under section 133 of the Companies Act, 2013 (hereinafter referred to as âthe Act"] read with the Companies (Accounts) Rules, 2014. The estimates and judgments relating to the financial statements are made on a prudent basis so as to reflect true and fair manner, the form and substances of transactions and reasonably present the state of affairs.

2.1 Standalone Financial Results

During the year under review, the Company achieved income from operations of Rs. 1 1,778.35 lakh as compared to Rs. 10,515.98 lakh in the previous year. The total comprehensive income was Rs. 1,539.98 lakh for the year ending 31^st March, 2023 as compared to Rs. 1,250.92 lakh in the previousyear.

During the year under review, there was no change in the nature of the business of the Company.

2.2 Consolidated Financial Results

During the year under review, the Company achieved income from operations of Rs. 13,959.90 lakh as compared to Rs. 11,423.42 lakh in the previous year. The total comprehensive income was Rs. 796.52 lakh for the year ending 31^st March, 2023 as compared to Rs. 819.52 lakh in the previous year.

3. Dividend and Reserves

In order to conserve the resources for the further growth of the Company, your Directors think fit not to recommend any dividend forthe year under review. The Board of Directors has decided to retain the entire a mount of profits in the profit and loss account.

4. Share Capital

During the year there were no changes in the Paid-up capital of the Company. The Company has not issued shares with differential voting rights, employee stock options and sweat equity shares. As on 31^st March, 2023, the Paid-up Equity Share Capital of the Company stood Rs.15,58,23,190/- comprising of 1,55,82,319 Equity Shares of Rs.10each.

The shareholders of the Company at their meeting held on Thursday, 29^th day of September, 2022 approved, by way of ordinary resolution, increase in the Authorised Share Capital of the Company from Rs. 20,00,00,000/-(Rupees Twenty Crore only) divided into 2,00,00,000 (Two Crore] Equity Shares of Rs. 1 ?/- (Rupees Ten only) each to Rs. 25,00,00,000 (Rupees Twenty Five Crore only] divided into 2,50,00,000 (Two Crore Fifty Lakh) Equity Shares of Rs. 10/- each (Rupees Ten only).

Paid up capital as on 31⁵'' March, 2023 is Rs. 15,58,23,190/-

The Company has paid Listing Fees for the financial year 2022-23 to each of the Stock Exchanges, where its equity shares are listed.

5. Annual Return

Pursuant to Notification dated 28^th August, 2020 issued by the Ministry of Corporate Affairs as published in the Gazette of India on 28^th August, 2020, the details forming part of the extract of Annual Return in Form MGT-9 is not required to be annexed herewith to this report. However, the Annual Return will be made available at the website of the Companyatwww.kilitch.com.

6. Management Discussion and Analysis Report

The Management Discussion and Analysis report including the result of operations of the Company for the year as required under Schedule IV of SEBI (Listing Obligation and Disclosure Requirements] Regulations, 2015 is appended to the Annual Report as Annexure -1

7. Detailsof Subsidiary Companies

As on 31^st March, 2023, the Company has two subsidiaries namely Monarchy Healthserve Private Limited and Kilitch Estro Biotech. In line with the requirements of the Act and Listing Regulations, the Company has formulated a policy for determining Material Subsidiaries and the same can be accessed on the Companyâs website atwww.kilitch.com

According to Section 129(3] of the Companies Act, 2013, financial statements of the Company are prepared in accordance with the relevant Indian Accounting Standard specified under the Act and the rules thereunder. A statement containing the salient features of the financial statements of the Companyâs subsidiaries in Form no. AOC-1 is appended as Annexure - II to the Board Report. The statement also provides the details of performance and financial position of each subsidiary.

8. Directorsand Key Managerial Personnel8.1 Appointments or Re-appointment and Cessation of Directorsand Key Managerial Personnel

Pursuantto the provisions of Section 152 of the Act, Mr. Mukund Mehta (DIN: 00147876] retires by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment.

Mr. Vasudev Krishnamurti (DIN: 00567672] was reappointed as a Non-Executive & Independent Director of the Company for a further term of 5 years with effect from 16^th March, 2023 as perthe recommendation made by Nomination and Remuneration Committee of the Company and same was approved by the members at the Extra-ordinary General Meeting of the Company held on Tuesday, 11^th April, 2023.

Mr. Venkita Subramanian Rajan (DIN: 00059146] was re-appointed as a Non-Executive & Independent Director of the Company for a further term of 5 years with effect from 28^th June, 2023 as per the recommendation made by Nomination and Remuneration Committee of the Company and same was approved by the members at the Extra-ordinary General Meeting of the Company held on Tuesday, 11^thApril, 2023.

Mr. Bhavin Mehta (DIN: 00147876) was re-appointed as a Wholetime Director of the Companyforafurtherterm of 5 years to hold office upto 31⁵¹ August, 2027 as perthe recommendation made by Nomination and Remuneration Committee of the Company and same was approved by the members at the Extra-ordinary General Meeting of the Company held on Tuesday, 11^thApril, 2023.

Based on the recommendation of Nomination and Remuneration Committee and Board of Directors of the Company, members at their meeting held on Tuesday, 11^th April, 2023 approved continuation of holding of office of Managing Director by Mr. Mukund Mehta (DIN: 00147876] upon attaining the age of 70^th years on 10^thAugust, 2023.

Ms. Princy Asati, Company Secretary and Key Managerial Personnel of the Company had resigned from the Company with effect from 15^th April, 2022 and Ms. Pushpa Nyoupane, an associate member of the Institute of CompanySecretariesof India was appointed as Company Secretary and Key Managerial Personnel of the Company with effect from 5^th May, 2022.

8.2 Key Managerial Personnel

As on 31^st March, 2023, the following were Key Managerial Personnel (KMP] of the Company in accordance with the provisions of Section 203 of the Act.

a] Mr. Mukund Mehta, Managing Director

b] Mr. Bhavin Mehta, Wholetime Director

c] Mrs. Mira Mehta, Wholetime Director

d] Mr. Sunil Jain, Chief Financial Officer

e] Ms. Pushpa Nyoupane, Company Secretary

During the year under review, Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company other than sitting fees, commission, and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board/Committee(s) ofthe Company.

9. Board of Directorsand No. of Meeting

The Board of Directors ofthe Company is comprised of eminent persons with proven competence and integrity. Besides the experience, strong financial acumen, strategic astuteness and leadership qualities, they have a significant degree of commitment towards the Company and devote adequate time to the meetings and preparation. In terms of the requirement of the Listing Regulations, the Board has identified core skills, expertise, and competencies ofthe Directors in the context of the Company''s businesses for effective functioning, which are detailed in the Corporate Governance Report.

During the year under review, 6 meetings of the Board of Directors were held. Details of the meetings of the Board and its Committee are furnished in the Report on Corporate Governance which forms part of this report.

Pursuantto provisions of part VII ofthe Scheduled IV of the Companies Act, 2013 and Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirement) Regulation, 2015, one meeting of Independent Director was held on 14^th June, 2022.

10. Declaration by Independent Director

Pursuant to Section 149(7] of the Companies Act, 2013 read with the rules made thereunder, all the Independent Directors of the Company have given the declaration that they meet the criteria of independence as laid down in section 149(6) of the Act and regulation 16(1 ](b] of the SEB I (Listing Obligations and Disclosure Requirements) Regulations, 2015

11. Annual Evaluation of Board, its Committee and Individual Directors

The Company has formulated a Policy for performance evaluation of the Board, Committees and other individual Director (including independent directors] which includes criteria for performance evaluation of

Non-Executive Directorand Executive Director.

In pursuant of section 134(3](p] of the Companies Act, 2013 read with rules made thereunder and the SEBI (Listing Obligations and Disclosure Requirements] Regulations, 2015, the Board of Directors carried out the performance evaluation of the Board as a whole and of its Committees and individual directors. A structured questionnaire was prepared after taking into consideration the various aspects of the Boardâs functioning, composition of the Board and its Committees, culture, execution and performance of specificduties, obligations and governance etc.

The Board of Directors took note of the observations on board evaluation carried out during the year as follows;

a) Observation of board evaluation carried out for the year - there were no observations in the Board Evaluation carried forthe year

b) Previous yearâs observations and actions taken -there were no observations of the Board for the last financialyear

c) Proposed actions based on current yearobservation -Not applicable

12. Audit Committee

The Committee has adopted a Charter for its functioning. The primary objective of the Committee is to monitor and provide effective supervision of the Managementâs financial reporting process, to ensure accurate and timely disclosures, with the highest levels of transparency, integrity, and quality of financial reporting.

The Composition of the Audit Committee is in line with the provisions of Section 177 of the Act read with Regulation 18 of SEBI Listing Regulations. Chairman of the Audit Committee is an Independent Director. The details of the composition of the Audit Committee are given in the Corporate Governance Report which is part of this report.

13. Nomination and Remuneration Committee

In accordance with Section 178 and all other applicable provisions, if any, of the Act read with the rules issued thereunder and regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements] Regulations, 2015, the Board of Directors have duly constituted Nomination and Remuneration Committee. Further, the Board of Directors on the recommendations of the Nomination and Remuneration Committee, have put in place a Nomination and Remuneration Policy of the Company.

The Companyâs remuneration policy is driven by the success and performance of the individual employees, senior management, executive directors of the Company and other relevant factors including the following criteria;

a] The level and composition of remuneration is reasonable and sufficientto attract, retain and motivate Directors and employees.

b] Relationship of remuneration to performance is clear and meets appropriate performance industry benchmarks; and

clRemuneration to Directors, Key Managerial Personnel and Senior Management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.

14. Particulars of Employees and Related Disclosures

The information required under section 197 of the Act read with the Rule 5(1](l] of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company and Directors is enclosed as Annexure - III and forms part of this Report.

Further, as perthe provisions specified in Chapter XI11 of Companies (Appointment & Remuneration of Managerial Personnel] Amendment Rules, 2016 none of the employees of the Company are in receipt of remuneration exceeding Rs. 1,02,00,000/- per annum, if employed for whole of the year or Rs. 8,50,000/- per month if employed for part of the year.

15. Stakeholders Relationship Committee

Your Board has constituted a Stakeholders Relationship Committee to specifically look into the mechanism of redressal of grievances of shareholders etc. The Committee reviews Shareholderâs / Investorâs complaints like non-receipt of Annual Report, physical transfer/ transmission/transposition, split/ consolidation of share certificates, issue of duplicate share certificates, etc. This Committee is also empowered to consider and resolve the grievance of other stakeholders of the Company including security holders.

The Committee met 1 (one] time during the year, the details of which are given in the Corporate Governance Report along with composition of the Committee and theirattendance.

16. Directors Responsibility Statement

Pursuantto Section 134(3](c] & 134(5] of the Companies Act, 2013, the Board of Directors of the Company hereby confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) appropriate accounting policies been selected and applied them consistently and made judgments and estimates that are 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 and loss of the companyforthat period;

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

(d) annual accounts have been prepared on a going concern basis;

(e) internal financial controls were in place and that such internal financial controls are adequate and were operating effectively; and

(f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

17. Statutory Auditors and Audit Report

Atthe 29^th Annual General Meeting of the Company held on Wednesday, 29^th September, 2021, the members had approved the appointment of M/s Suryaprakash Maurya & Co, Chartered Accountants (FRN:147410W] as Statutory Auditors of the Company for a period of five year to hold office from the conclusion of 29^th AGM till the conclusion of thirty fourth AGM to be held in the year 2026.

The Statutory Audit Report for the financial year 202223 on the financial statements of the Company forms part of the annual report. Auditors have expressed their unmodified opinion on the Standalone and Consolidated Financial Statements and their reports do not contain any qualifications, reservations, adverse remarks, ordisclaimer.

The Statutory Auditors of the Company have not

reported anyfraud as specified underSection 143(12] of the Act, intheyearunderreview.

18. Secretarial Auditors and Audit Report

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Deep Shukla & Associates, Company Secretary in Practice as the Secretarial Auditor of Company to carry out the Secretarial Audit of the Company for a period of 5 years i.e. for the Financial Year2020-21 to FinancialYear2025-26.

The Report of the Secretarial Auditor for financial year 2022-23 is attached herewith as Annexure - IV. There are no qualifications, observations or adverse remarks, ordisclaimer in the said report.

19. Annual Secretarial Compliance Report

M/s. Deep Shukla & Associates, Practicing Company Secretaries, have been appointed to give Annual Secretarial Compliance Certificate. The Annual Compliance Certificate is enclosed as Annexure V to this report.

20. Inte rnal Audit&Controls

The Company has in place adequate internal financial controls with reference to the financial statement. The Audit Committee of the Board periodically reviews the internal control systems with the management, Internal Auditors and Statutory Auditors. Significant internalaudit findings are discussed and follow-ups are taken thereon.

Further, Mr. Agnel Fernandes was appointed as Internal Auditors of the Company pursuantto section 138 of the Companies Act, 2013.

21. Cost Auditors and Cost Audit

The Board of Directors of the Company (''the Boardâ] at the meeting held on 11^th August, 2023, based on the recommendation of the Audit Committee, approved the re-appointment of M/s Arvind Kumar & Co. Cost Accountants (Firm Registration No. 000646], as a Cost Auditor, to conduct audit of Cost Records maintained by the Company forthe financialyear 2023-24. Resolution for ratification of remuneration of the cost auditors by member has been set out in the notice of 31^st annual general meeting.

They have confirmed that their appointment is in accordance with the applicable provisions of the Act and

Rules framed thereunder.

22. Particulars of Loans, Investment and Guarantees

The particulars of loans, guarantee, and investments covered under the provisions of Section 186 of the Act have been disclosed in notes of the financial statements of the Company forming partofthe annual report.

23. Particulars of Contracts and Arrangements with related parties.

During the year under review, all Related Party Transactions (RPTs) entered into by the Company were on an arms'' length basis and in the ordinary course of business. These RPTs did not attract provisions of Section 188 of the Companies Act, 2013 and were also not material RPTs under Regulation 23 of the Listing Regulations. All related party transactions were approved by the Audit Committee and are periodically reported to the Audit Committee. Prior approval of the Audit Committee was obtained periodically for the transactions which were planned and/or repetitive in nature and omnibus approvals were also taken as per the policy laid down for unforeseen transactions.

None of the transactions with related parties falls under the scope of Section 188(1] of the Act. The information on transactions with related parties pursuant to Section13A(3](h] of the Act read with Rule 8(2] of the Companies (Accounts] Rules, 2014. in Form AO C-2 does not apply to the Com pa ny for the FY 2022-23 and hence the same is not provided. The disclosure of the transactions with related parties during financial year 2022-23 as required under IndAS have been made in notes of the financial statements of the Company forming part of the annual report.

In line with the requirements of the Act and the Listing Regulations, the Company has formulated a Policy on Related Party Transactions and the same can be accessed on the Companyâs website atwww.kilitch.com

2Â£. Material Changes and Commitments affecting the financial position of the company

There was no material change / commitment affecting the financial position of the Company during the period from the end of the financial year under review to the date of the report.

25. Particulars of Energy Conservation, Technology Absorption, and Foreign Exchange Earnings and Outgo [PursuantTo Companies (Accounts) Rules, 2016]

25.1 Conversation of Energya) steps taken or impact on conservation of energy;

The use of energy is being optimized through improved operational methods. Continuous efforts are being made to optimize and conserve energy by improvement in production process. Even though its operations are not energy-intensive, significant measures are taken to reduce energy consumption by using energy-efficient equipment. The Company regularly reviews power consumption patterns in its all locations and implements requisite improvements/changes in the process in order to optimize energy/ power consumption and thereby achieve cost savings.

b) Steps taken for utilizing alternate sources of energy;

The Company has not made any investment for utilizing alternate source of energy.

c) Capital investment on energy conservation equipment;

The Company has taken adequate measures to conserve energy by wayof optimizing usage of power.

25.2 Absorption of Technology:a) The efforts made towards technology absorption:

The Company has been engaging with various Suppliers, Research Institutes, Analytical Service providers and technology providers for technical collaborations for product & process development, new packaging development, research-oriented projects, and analytical service support. Technical discussions were held to identify the appropriate technologies, solutions and development and process improvement support. This drives development of distinctive new products, ever improving quality standards and more efficient processes.

The Company uses the service of in-house designers as well as those of free-lancers in developing product designs as per the emerging market trends. The Company uses innovation in design as well as in technology to develop new products.

b) Benefitsderivedasa result of the above efforts:

As a result of the above, the following benefits have been achieved:

â¢ Betterefficiency in operations,

â¢ Reduced dependence on external sources for technology for developing new products and upgrading existing products,

â¢ Expansion of product range and cost reduction,

â¢ Greater precision,

â¢ Retention of existing customers and expansion of customerbase,

â¢ Lower inventory stocks resulting in low carrying costs.

c) The Company has not imported any technology during the year under review;

d] The Company has not expended any expenditure towards Research and Development during the year under review.

25.3 Foreign Exchange Earning And Outgo:

	[Rs.	in Lakhs]
Particulars	2022-23	2021-22
Foreign Exchange Earned	6,021.27	5,088.34
Foreign Exchange Outgo	1,607.35	584.94

26. Corporate Social Responsibility Policy

Pursuant to the section 135 of the act, the Corporate Social Responsibility Committee of the Company has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy] indicating the activities to be undertaken by the Company which has been approved by the Board. The CSR Policy is displayed on the website of the Company at www.kilitch.com. Report on CSR activities undertaken by the Company is appended to this report as Annexure - VI. Detailed composition of the CSR Committee and its meeting is given in detailed in the Report on Corporate Governance which forms part of the Annual Report.

27. Vigil Mechanism / Whistler Blower Policy

Pursuant to the provisions of Section 177 of the Companies Act, 2013 read with the rules made thereunder, the Company has formulated and implemented Vigil Mechanism/ Whistle Blower Policy for disclosing of any unethical behavior, actual or suspected fraud or violation of companyâs code of conduct and other improper practices or wrongful conduct by employees or directors of the Company. The salient features of the policy have been detailed in the Report on Corporate Governance forming part of this Report. The Vigil Mechanism/ Whistle Blower Policy has been posted and is available on the website of the Companyatwww.kilitch.com

28. Risk Management Policy

Pursuant to section 134(3)(n) of the Act, the Company has a Risk Management (RM] framework to identify, monitor, evaluate business risks and opportunities. The framework seeks to create transparency, minimize adverse impact on the business objectives and enhance the Company''s competitive advantage.

The risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. The framework helps in identifying risk trend, exposure and potential impact analysis at a Company Level. The Board shall from time-to-time monitor and review the said policy.

29. Disclosure As Per The Sexual Harassment Of Women At Workplace (prevention, Prohibition And Redressall Act, 2013

As per the provisions of Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal] Act, 2013, the Company has constituted an Internal Complaints Committee for redressal of complaints against sexual harassment.

There were no complaint relating to sexual harassment pending at the beginning of the financial year, received during the year and pending at the end of the financial year 2022-23.

30. Significant And Materials Orders Passed By The Regulators Or Courts

There were no significant and material orders passed by the Regulators / Courts which impact the going concern status of the Company and its future operations.

31. Internal Financial Control Systems And Their Adequacy

The Board has adopted policies and procedures for the governance of orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding its assets, prevention, and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures. The Companyâs internal control systems are commensurate with the nature of its business, the size and complexity of its operations and such internal financial controls concerning the Financial Statements are adequate.

The Management evaluates the efficacy and adequacy of internal control system in the Company, its compliance with the operation systems, accounting policies and procedures of the Company.

32. Deposit From Public

The Company has not accepted any deposits from the public during the year under review. No amount on account of principal or interest on deposits from the public was outstanding as on 31⁵¹ March, 2023.

33. Prevention Of Insider Trading

The Company has adopted a Code of Conduct for Prevention of Insider Trading in compliance with SEBI (Prohibition & Insider Trading) Regulation, 2015 duly amended and approved at its board meeting with a view to regulate trading in securities by Directors and Designated Employees of the Company.

34. Corporate Governance Report

We ensure that, we evolve and follow the corporate governance guidelines and best practices sincerely, not only to boost long-term shareholder value, but also to respect minority rights. We consider it as our inherent responsibility to disclose timely and accurate information regarding our operations and performance, as well as the leadership and governance of the Company.

Pursuant to the Listing Regulations, the Corporate Governance Report along with the Certificate from a Practicing Professionals regarding compliance of conditions of Corporate Governance, is annexed as Annexure VII and forms part of this Report.

35. SecretarialStandards

The Institute of Company Secretaries of India has mandated compliance with the Secretarial Standards on board meetings and general meetings. During the year under review, the Company has complied with the applicable Secretarial Standards.

36. Investor Education And Protection Fund (IEPF)

Pursuant to the provisions of Section 124 of the Act read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund] Rules, 2016, as amended (''IEPF Rulesâ], total amount of dividend remained unpaid / unclaimed for a period of seven consecutive years or more from the date of transfer to the Unpaid Dividend Account of the Company are liable to be transferred to the Investor Education

and Protection Fund.

Further, all the shares (excluding the disputed cases having specific orders of the Court, Tribunal or any Statutory Authority restraining such transfer] on which dividends remain unpaid or unclaimed for a period of seven consecutive years or more from the date of transfer of dividend to Unpaid Dividend Account shall also be transferred to the demat account of the IEPF Authority as notified by the Ministry of Corporate Affairs within statutorytimelines.

The following tables provides the details regarding unclaimed dividend and their corresponding shares would become due to transferred to the IEPF on the dates mentioned below;

Financial

Year

Ended

Date of Declaration of Dividend

Last date for claiming unpaid dividend

Due date for transfer to IEPF

2017-18

27/09/2018

02/1 1/2025

02/12/2025

2018-19

30/09/2019

05/1 1/2026

05/11/2026

37. EmployeeStockOptionScheme1. EmployeeStockOption Scheme, 2007

During the year under review, there has been no material change inESOPScheme.TheESOPSchemeis in compliance with Securities and Exchange Board of India (Share Based Employee Benefit] Regulations, 2014. The disclosures relating to ESOPs required to be made underthe provisions of Rule 12 ofthe Companies (Share Capital and Debentures) Rules, 2014 is as follows:

Sr. No.	Particulars	Options
a.	Options Outstanding at the beginning of the year	17,526
b.	options granted	-
c.	options vested	17,526
d.	options exercised / settled	-
e.	the total number of shares arising as a result of exercise of option	-
f.	options lapsed	-
g-	the exercise price	-
h.	variation of terms of options	-
i.	money realized by exercise of options	-

j-	total number of options in force	17,526
k.	employee wise details of options granted to:-
	(I] key managerial personnel
	1. Sunil Jain-Chief Financial Officer	-
	2. Pushpa Nyoupane- Company Secretary & Compliance Officer	-
	(ii] any other employee who receives a grant of options in any one year of option amounting to five per cent or more of options granted during the year	-
	(iii) identified employees who were granted option, during any one year, equal to or exceeding one per cent of the issued capital (excluding outstanding warrants and conversions] of the company at the time of the grant	-

2. Employee Stock Option Scheme, 2020

During the year under review, there has been no material change in ESOP Scheme. The ESOP Scheme is in compliance with Securities and Exchange Board of India (Share Based Employee Benefit] Regulations, 2014. The disclosures relating to ESOPs required to be made underthe provisions of Rule 12 of the Companies (Share Capital and Debentures] Rules, 2014 is as follows:

Sr. No.	Particulars	Options
a.	options outstanding at the beginning of the year	1,05,264
b.	options granted	-
c.	options vested	1,05,264
d.	options exercised / settled	-
e.	the total number of shares arising as a result of exercise of option	-
f.	options lapsed	-
g-	the exercise price	-
h.	variation of terms of options	-
i.	money realized by exercise of options	-
j-	total number of options in force	1,05,264

k.	employee wise details of options granted to:-
	(i] key managerial personnel
	1. Sunil Jain-Chief Financial Officer	-
	2. Pushpa Nyoupane- Company Secretary & Compliance Officer	-
	(ii] any other employee who receives a grant of options in any one year of option amounting to five per cent or more ol options granted during the year
	(iii] identified employees who were granted option, during any one year, equal to or exceeding one per cent of the issued capital (excluding outstanding warrants and conversions] of the company at the time of the grant	-

38. Insurance

The properties/assets of the Company are adequately insured.

39. Reporting of Fraud

There have been no instances of fraud reported by the auditors under section 143(12) of the Act, and Rules framed thereunder either to the Company or to the Central Government.

40. Acknowledgement

The Directors wish to convey their appreciation to a lithe investors, customers, vendors, employees, and consultants/advisors of the Company for their collective contribution to the Companyâs performance as well as sincere and dedicated services toward achievement of the Vision of the Company. The Directors take pleasure to thank the Central Government, State Governments, Government of other Countries and concerned Government departments for their continuous co-operation. The Directors appreciate and value the contribution made by every member, employee, and their families Kilitch Drugs (India] Group.

Mar 31, 2018

To,

The Members,

KILITCH DRUGS (INDIA) LIMITED

The Directors have pleasure in presenting their 26^th Annual Report on the business and operations of your Company for the year ended 31^st March 2018.

1. FINANCIAL RESULTS:

The summarized financial performance (Standalone & Consolidation) of the Company for the financial year ended 31^st March 2018 and 31^st March 2017, are given below:

[Amount in Rs. Lakhs]

Particulars	Standalone		Consolidated
Particulars	2017-18	2016-17	2017-18	2016-17
Revenue from Operations	5,045.78	2813.91	5,101.18	2865.25
Other Income	277.91	113.79	287.54	113.79
Total Revenue	5,323.69	2,927.70	5,388.72	2,979.04
Total Expenses	4,608.05	2,973.70	4,777.45	3,910.56
Profit/(Loss) before exceptional and extraordinary	715.64	(46.00)	611.27	(931.52)
items and tax
Exceptional Items	-	-	-	-
Extraordinary Items	-	-	-	-
Net Profit Before Tax	715.64	(46.00)	611.27	(931.52)
Provision for Tax
- Current Tax	33.48	-	33.48	-
- Deferred Tax (Liability)/Assets	62.57	42.36	62.55	42.56
Net Profit After Tax	619.59	(3.64)	515.24	(888.96)
Profit/(Loss) from continuing operations	619.59	(3.64)	515.24	(888.96)
Other Comprehensive Income (After Tax)	66.81	235.49	66.81	235.49
Total Comprehensive income for the period	686.40	231.85	582.05	(653.47)
(Comprising Profit (Loss) and Other Comprehensive
Income for the period)
Paid up Equity Share Capital (Face Value Rs. 10/- per	1,373.18	1,323.18	1,373.18	1,323.18
Share)
Other Equity	11,746.37	10,578.96	9,829.55	8,796.73
Earning per share (for continuing operation) (Amount in â)
- Basic	4.68	(0.03)	3.89	(6.72)
- Diluted	4.40	(0.03)	3.66	(6.72)

2. REVIEW OF OPERATIONS:

Standalone: -

During the year under review, the Company has posted total Income of Rs. 5,323.69 Lakhs as against Rs. 2,927.70 Lakhs for the corresponding previous year.

Further, total Comprehensive income for the period was Rs. 686.40 Lakhs as against Rs. 231.85 Lakhs for the corresponding previous year.

Consolidated: -

During the year under review, the Company has posted total Income of Rs. 5,388.72 Lakhs as against Rs. 2,979.04 Lakhs for the corresponding previous year.

Further, total Comprehensive income for the period was Rs. 582.05 Lakhs as against Net Loss of Rs. 653.47 Lakhs for the corresponding previous year.

3. STATEMENT OF AFFAIRS AND FUTURE OUTLOOK:

We consider Africa as the bestow of our success & accordingly we are enhancing our presence in most of the African countries. As your are aware, we are building a State of art facility at Addis Ababa, Ethiopia to cater not only Ethiopia but all surrounding countries in incremental way. As per the latest information on our Ethiopian operation, we are glad to inform you that around 45-50% construction work is complete as on date hopefully we should start commercial production in early 2019-20.

With the objective of growing and going forward, the company is recognizing the need to improve R&D productivity, increase the efficiency of operations, adopt a more flexible approach to pricing, invest in developing medicines the market wants to buy and develop marketing and sales functions that are fit for the future and a knowledge based commercial organization.

Standing to this belief and expecting your support, the company shall able to claim a share in the African market by leveraging its strengths and enhancing its regulatory and technical maturity thereby achieving all time highest export sales of our organization.

4. MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report, which gives a detailed state of affairs of the Companyâs operations forms part of this Annual Report .

5. DIVIDEND AND RESERVES:

The Board of Directors of the Company has recommend dividend @ 5% on per Fully Paid ordinary Share of the Company, at their meeting held on 25^th May 2018, subject to the approval of the members at their ensuing Annual General Meeting.

The Register of Members and Share Transfer Books of the Company will remain closed from Thursday 20^th September 2018 to Thursday 27^th September 2018 (both days inclusive) for the purpose of payment of dividend for the Financial Year ended 31^st March 2018 and the AGM.

6. SHARE CAPITAL:

The Paid-up Equity Share Capital of the Company as on 31^st March 2018 is Rs. 1,373.18 Lakhs, comprising of 13731828 Equity Shares of Rs. 10/- each as against Rs. 1,323.18 Lakhs, comprising of 13231828 Equity Shares of Rs. 10/- each in the previous year.

The Board of Directors at their meeting held on 20^th September 2017 approved the allotment of 21, 00,000 Warrants on preferential basis after taking approval of the Members of the Company through Postal Ballot.

Further, the Board has allotted 5,00,000 Equity Shares to the promoters of the Company on conversion of warrants issued by the Company on 29^th March 2018.

7. EMPLOYEE STOCK OPTION SCHEME:

The Company, under the Scheme (KDIL ESOS 2007) approved by the shareholders vide a special resolution as on 29^th September 2007 and amended from time to time with their approval grants share based benefits to eligible employees with a view to attracting and retaining the best talent, encouraging employees to align individual performances with Company Objectives, and promoting increased participation by them in the growth of the Company.

The said scheme is in compliance with SEBI (Share-based Employee Benefits) Regulations, 2014 and at 25^th Annual General Meeting held on 29^th September 2017, altered various clause of said scheme by passing special resolution, such as exercise price of option which would be Rs. 10, maximum number of options may be granted to each employee upto to 1,00,000 options, exercise period upto 5 years from the date of grant, etc..

The following disclosures are being made upto 31^st March 2018 as required under Rule 12 of the Companies (Share Capital and Debentures) Rules, 2014:

Sr. No.	Particulars	Options
a	Options Outstanding at the beginning of the year	175243
b	options granted	0
c	options vested	0
d	options exercised / settled	0
e	the total number of shares arising as a result of exercise of option
f	options lapsed	0
g	the exercise price	Rs. 10/-
h	variation of terms of options	1. Exercise price of option which would be Rs. 10. 2. Maximum number of options may be granted to each employee upto to 1,00,000 options, 3. Exercise period upto 5 years from the date of grant.
i	money realized by exercise of options	-
j	total number of options in force	175243
k	employee wise details of options granted to:-
	(i) key managerial personnel	2856

	( ii ) any other employee who receives a grant of options in any one year of option amounting to five per cent or more of options granted during the year
(iii) identified employees		-
who were granted
option, during any
one year, equal to or
exceeding one per
cent of the issued
capital (excluding
outstanding
warrants and
conversions) of the
company at the time
of the grant

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Inductions / Appointment or Re-appointment of Director

At the 25^th Annual General Meeting held on 29^th September 2017, Mrs. Mira Bhavin Mehta was re-appointed as the Whole-time Director of the Company liable to retire by rotation. Also, Mr. Bhavin Mehta was re-appointed as the Whole-time Director of the Company w.e.f. 1^st September 2017 for a period of 5 years.

Further on the recommendations of the Nomination and Remuneration Committee, the Board of Directors had appointed Prof. Vasudev Krishna Murti and Mr. Venkita Subramanian Rajan as an Additional (Independent) Directors in their meeting held on 16^th March 2018 and 28^th June 2018, respectively, in pursuant to section 161 of the Companies Act, 2013 read with Articles of Association of the Company, who shall hold the office until 26^th Annual General Meeting.

The resolutions for confirming the appointment of Prof. Vasudev Krishna Murti and Mr. Venkita Subramanian Rajan as an Independent Director, forms part of the Notice convening the 26^th Annual General Meeting (âAGMâ) scheduled to be held on 27^th September 2018. We seek your support and hope you will enthusiastically vote in confirming his appointment to the Board.

Cessation

Further, Mr. Mukesh Shah and Mr. Pankaj Kamdar, Independent Directors, has tendered their resignations from office of directorship of the Company with effect from 2^nd April 2018.

The Board expresses its gratitude towards Mr. Mukesh Shah and Mr. Pankaj Kamdar for their contributions to the Company. The Board acknowledges that the Company has immensely benefitted from their profound knowledge and experience in the Pharma industry.

Retire by Rotation

In accordance with section 152(6) of the Companies Act, 2013 and in terms of Articles of Association of the Company Mr. Mukund Mehta (DIN:00147876), Managing Director of the Company, retires by rotation and being eligible; offers himself for re-appointment at the forthcoming 26^th Annual General Meeting. The Board recommends the said reappointment for shareholdersâ approval.

All the directors of the Company have confirmed that they satisfy the fit and proper criteria as prescribed under the applicable regulations and that they are not disqualified from being appointed as directors in terms of Section 164(2) of the Companies Act, 2013.

Key Managerial Personnel

During the year under review, Mr. Dharmendra Makwana was appointed as the Company Secretary in Whole time employment w.e.f. 30^th May 2017 and subsequently he tendered his resignation from post of Company Secretary with effect from 31^st August 2017.

Further, The Board has appointed Ms. Jill Gada as the Company Secretary in Whole time employment w.e.f. 20^th September 2017 and, she tendered her resignation as the Company Secretary with effect from 22^nd December 2017.

Further, The Board has appointed Mr. Harshal Patil as the Company Secretary in Whole time in employment w.e.f. 14^th February 2018.

Pursuant to Section 203 of the Companies Act, 2013, Key Managerial Personnel of the Company as on 31^st March 2018, details are as under are:

Sr. No.	Name of KMP	Designation
1.	Mr. Mukund Prataprai Mehta	Managing Director
2.	Mr. Bhavin Mukund Mehta	Whole-time Director
3.	Mrs. Mira Bhavin Mehta	Whole-time Director
4.	Mr. Harshal Anant Patil	Company Secretary and compliance officer
5.	Mr. Shailesh Shivram Mirgal	Chief Financial Officer

9. INDEPENDENT DIRECTORS

The Independent Director(s) have submitted their disclosure to the Board that they fulfill all the requirements as to qualify for their appointment as Independent Director, under the provisions of section 149 of the Companies Act, 2013 as well as Regulation 17 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements] Regulations, 2015.

10. DISCUSSIONS WITH INDEPENDENT DIRECTORS

The Boardâs policy is to regularly have separate meetings with Independent Directors, to update them on all business related issues, new initiatives and changes in the industry specific market scenario. At such meetings, the Executive Directors and other Members of the Management make presentations on relevant issues.

The policy for Familiarisation Programme for Independent Directors is available on our website www.kilitch.com.

11. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees. The Directors expressed satisfaction with the evaluation process. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

12. NUMBER OF BOARD MEETINGS

A calendar of meetings is prepared and circulated in advance to the Directors. During the year, 9 (Nine) Board Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015.

Further, Committees of the Board usually meet on the same day of formal Board Meeting, or whenever the need arises for transacting business. The recommendations of the Committees are placed before the Board for necessary approval and noting.

13. COMPOSITION OF AUDIT COMMITTEE

Your Company has formed an Audit Committee as per the Companies Act, and the Listing Agreement / SEBI (LODR) Regulations, 2015. All members of the Audit Committee possess strong knowledge of accounting and financial management.

Further, the Audit Committee is functional as per the provision of Section 177 of Companies Act, 2013 and Rules made thereunder and as per Regulation 18 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The other details of the Audit Committee are given in the Corporate Governance Report, appearing as a separate section in this Annual Report.

14. COMPOSITION OF NOMINATION & REMUNERATION COMMITTEE

Your Company has formed a Nomination & Remuneration Committee to lay down norms for determination of remuneration of the executive as well as non-executive directors and executives at all levels of the Company.

The other details of the Nomination & Remuneration Committee are given in the Corporate Governance Report, appearing as a separate section in this Annual Report.

15. NOMINATION AND REMUNERATION POLICY

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors. This policy also lays down criteria for selection and appointment of Board Members. The details of this policy are provided as Annexure- I to this Report and also available on the website of the Company www.kilitch.com.

Details of remuneration paid to Directors and Key Managerial Personnel are given in the Corporate Governance Report along with shareholding in a Company.

16. COMPOSITION OF STAKEHOLDERS RELATIONSHIP COMMITTEE

The other details of the Stakeholders Relationship Committee are given in the Corporate Governance Report, appearing as a separate section in this Annual Report.

17. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) & 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are 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 and loss of the company for that period;

(c) the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors have prepared the annual accounts on a going concern basis; and

(e) the directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

18. PARTICULARS OF EMPLOYEES AN RELATED DISCLOSURE

The information required pursuant to Section 197 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 in respect of employees of the Company, is enclosed as Annexure II and forms part of this Report.

Further, no employee of the Company is earning more than the limits as prescribed pursuant to Section 197 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 in respect of employees of the Company.

Further, the names of top ten employees in terms of remuneration drawn are disclosed in Annexure III and forms part of this Report.

19. EXTRACT OF ANNUAL RETURN

The details forming part of the Extract of the Annual Return in Form MGT-9, as required under Section 92 of the Companies Act, 2013 is included in this Report as Annexure IV and forms part of this Report.

20. DETAILS OF SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES

The Company has 2 subsidiaries as on 31^st March 2018. During the year, the Board of Directors reviewed the affairs of material subsidiaries. In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared consolidated financial statements of the Company and all its subsidiaries, which form part of the Integrated Report. Further, the report on the performance and financial position of each subsidiary and salient features of the Financial Statements in the prescribed Form AOC-1 is annexed to this report as an Annexure V.

In accordance with the provisions of Section 136 of the Companies Act, 2013 and the amendments thereto, the audited Financial Statements, including the consolidated financial statements and related information of the Company and financial statements of the subsidiary companies will be available on our website www. kilitch.com. These documents will also be available for inspection during business hours at the Registered Office of the Company.

None of the company have become or ceased to be subsidiaries, joint ventures and associates during the year under review.

21. STATUTORY AUDIT

Under Section 139 of the Companies Act, 2013 and the Rules made thereunder, it is mandatory to rotate the statutory auditor on completion of the maximum term permitted under the said section. In line with the requirement of the Companies Act, 2013, M/s. A. M. Ghelani & Co., Chartered Accountants (Firm Registration No. 103173W) were appointed as the statutory auditor of the Company to hold office for a period of four consecutive years from the conclusion of the 25^th Annual General Meeting of the Company held on 29^th September 2017, till the conclusion of the 29^th Annual General Meeting to be held in the year 2021.

In terms of the provisions relating to statutory auditors forming part of the Companies Amendment Act, 2017, notified on 7^th May 2018, ratification of appointment of Statutory Auditors at every Annual General Meeting is no more a legal requirement. However, pursuant to Ordinary Resolution passed at the 25^th Annual General Meeting, appointment shall subject to ratification at every annual general meeting.

Hence, the Notice convening the ensuing 26^th Annual General Meeting contained a resolution on ratification of appointment of Statutory Auditors. Further, M/s. A. M. Ghelani & Co., Chartered Accountants (Firm Registration No. 103173W), has confirmed that they are eligible to continue as Statutory Auditors of the Company to audit the books of accounts of the Company for the Financial Year ending 31^st March 2019 and they will continue to be the Statutory Auditors of the Company for Financial Year ending 31^st March 2021.

The Notes on financial statement referred to in the Auditorsâ Report are self-explanatory and do not call for any further comments. The Auditorsâ Report does not contain any qualification, reservation, adverse remark or disclaimer.

22. SECRETARIAL AUDIT

In terms of Section 204 of the Act and Rules made there under, M/s. Deep Shukla, Practicing Company Secretary, have been appointed Secretarial Auditors of the Company. The Secretarial Audit Report is enclosed as Annexure VI to this report.

The Secretarial Auditorsâ Report does not contain any qualification, reservation, adverse remark or disclaimer.

23. COST AUDIT

As per the Cost Audit Orders and in terms of the provisions of Section 148 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, Cost Audit is not applicable to our Company.

24. INTERNAL AUDIT & CONTROLS

The Company has in place adequate internal financial controls with reference to the financial statement. The Audit Committee of the Board periodically reviews the internal control systems with the management, Statutory Auditors. Significant internal audit findings are discussed and follow-ups are taken thereon.

Further, M/s. Milind Mehta & Co., Chartered Accountants, having Membership No. 47739 were appointed as Internal Auditors of the Company but he resigned as internal auditor of the Company.

The Board of Directors has appointed M/s. ABB & Associates, Chartered Accountants, (Firm Registration No: 116615W), as an Internal Auditor of the Company in place of M/s. Milind Mehta & Co., to carry out the Internal Audit for the financial year 2017-18 w.e.f. 14^th November 2017.

25. VIGIL MECHANISM

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.kilitch. com. The employees of the Company are made aware of the said policy at the time of joining the Company.

26. RISK MANAGEMENT POLICY

The Company has laid down the procedure to inform the Board about the risk assessment and minimization procedures. These procedures are reviewed by the Board annually to ensure that there is timely identification and assessment of risks, measures to mitigate them, and mechanisms for their proper and timely monitoring and reporting.

The Company does not fall under the ambit of top 100 listed entities, determined on the basis of market capitalisation as at the end of the immediately preceding financial year. Hence, compliance under Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is not applicable.

27. DEPOSITS

The Company has neither accepted nor renewed any fixed deposits during the year under review under Section 76 of the Companies Act, 2013. There are no unclaimed deposits, unclaimed / unpaid interest, refunds due to the deposit holders or to be deposited to the Investor Education and Protection Fund as on 31^st March 2018.

28. LOANS & GUARANTEES

During the year under review, the Company has given a loan and made an Investment which are covered under the provisions of Section 186 of the Companies Act, 2013 to any person or other body corporate, however, no guarantee given and security provided by the Company.

29. INSURANCE

The properties/assets of the Company are adequately insured.

30. RELATED PARTY TRANSACTIONS

During Financial Year 2017-18, the Company entered into certain Related Party Transactions which are in the ordinary course of business and at armâs length basis, with approval of the Audit Committee. The Audit Committee grants omnibus approval for the transactions which are of foreseen and repetitive nature. A detailed summary of Related Party Transactions is placed before the Audit Committee and the Board of Directors for their review every quarter.

There are no materially significant Related Party Transactions executed between the Company and its Promoters, Directors, key Managerial Personnel or other designated persons, that may have a potential conflict with the interest of the Company at large.

Since all Related Party Transactions entered into by the Company were in ordinary course of business and were on an armâs length basis, the particulars as required in form AOC-2 have not been furnished.

In the preparation of financial statements, the Company has followed the applicable Accounting Standards. The significant accounting policies that are applied have been set out in the Notes to Financial Statements.

31. CORPORATE GOVERNANCE CERTIFICATE

We ensure that, we evolve and follow the corporate governance guidelines and best practices sincerely, not only to boost long-term shareholder value, but also to respect minority rights. We consider it our inherent responsibility to disclose timely and accurate information regarding our operations and performance, as well as the leadership and governance of the Company.

In compliance with Regulation 34(3) read with Schedule V(C) of the SEBI (LODR) Regulations, 2015, a Report on Corporate Governance forms part of this Annual Report. The Certificate as issued by Practicing Company Secretary certifying compliance with the conditions of corporate governance as prescribed under Schedule V(E) of the SEBI (LODR) Regulations, 2015, is annexed to the Corporate Governance Report.

32. CORPORATE SOCIAL RESPONSIBILITY

As per audited financial statement for the year ended 31^st March 2018, the company requires to constitute a Corporate Social Responsibility Committee of the Board consisting of three or more directors, out of which at least one director shall be an independent director.

Hence, the Board of Directors at their meeting held on 25^th May 2018, constituted Corporate Social Responsibility Committee to discharge their social responsibility as a corporate citizen,in pursuant Section 135 of Companies Act, 2013, read with the Companies (Corporate Social Responsibility Policy) Rules, 2014.

The Corporate Social Responsibility Committee has formulated the CSR Policy of the Company. The same is annexed to this report as Annexure VII and is available on our website www.kilitch.com.

Details of composition of the Committee are as under:

Sr. No.	Name of Directors	Executive/NonExecutive Independent
1.	Mr. Bhavin Mehta	Executive
2.	Mrs. Mira Mehta	Executive
3.	Mr. Murti Vasudev Krishna	Non-Executive Independent

33. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

(A) Conservation of Energy:

i. steps taken or impact on conservation of energy;

The use of energy is being optimized through improved operational methods. Continuous efforts are being made to optimize and conserve energy by improvement in production process. Even though its operations are not energy-intensive, significant measures are taken to reduce energy consumption by using energy-efficient equipments. The Company regularly reviews power consumption patterns in its all locations and implements requisite improvements/changes in the process in order to optimize energy/ power consumption and thereby achieve cost savings.

ii. Steps taken for utilizing alternate sources of energy;

The steps taken by the Company for utilizing alternate sources of energy: The Company is using electricity as the main source of energy and is currently not exploring any alternate source of energy.

iii. Capital investment on energy conservation equipment;

Our Company firmly believes that our planet is in dire need of energy re-sources and conservation is the best policy.

(B) Absorption of Technology:

i. The efforts made towards technology absorption:

The Company values innovation and applies it to every facet of its business. This drives development of distinctive new products, ever improving quality standards and more efficient processes.

The Company has augmented its revenues and per unit price realization by deploying innovative marketing strategies and offering exciting new products. The depth of designing capabilities was the core to our success over the years.

ii. Benefits derived as a result of the above efforts:

As a result of the above, the following benefits have been achieved:

a. Better efficiency in operations,

b. Reduced dependence on external sources for technology for developing new products and upgrading existing products,

c. Expansion of product range and cost reduction,

d. Greater precision,

e. Retention of existing customers and expansion of customer base,

f. Lower inventory stocks resulting in low carrying costs.

iii. The Company has not imported any technology during the year under review;

iv. The Company has not expended any expenditure towards Research and Development during the year under review.

34. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of the Companies Act, 2013 read with The Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended, (âRulesâ), the dividends, unclaimed for a consecutive period of seven years from the date of transfer to the Unpaid Dividend Account of the Company are liable to be transferred to IEPF. Further, the shares (excluding the disputed cases having specific orders of the Court, Tribunal or any Statutory Authority restraining such transfer) pertaining to which dividend remains unclaimed for a period of continuous seven years from the date of transfer of the dividend to the unpaid dividend account are also mandatorily required to be transferred to the IEPF established by the Central Government. Accordingly, the Company has transferred eligible Shares to IEPF Demat Account maintained by the IEPF authority within statutory timelines.

The Company has sent individual communication to the concerned shareholders at their registered address, whose dividend remained unclaimed and whose shares were liable to be transferred to the IEPF by 31^st October 2017. The communication was also published in national English and local Marathi newspapers.

Any person whose unclaimed dividend and shares pertaining thereto, matured deposits, matured debentures, application money due for refund, or interest thereon, sale proceeds of fractional shares, redemption proceeds of preference shares, amongst others has been transferred to the IEPF Fund can claim their due amount from the IEPF Authority by making an electronic application in e-form IEPF-5. Upon submitting a duly completed form, Shareholders are required to take a print of the same and send physical copy duly signed along with requisite documents as specified in the form to the attention of the Nodal Officer, at the Registered Office of the Company. The e-form can be downloaded from the website of Ministry of Corporate Affairs www.iepf.gov.in.

Dates of declaration of dividends since 2010-11 and the corresponding dates when unclaimed dividends are due to be transferred to the Central Government are given in the below table.

Financial Year Ended	Date of declaration of Dividend	Amount Remaining unclaimed/ Unpaid as on 31.03.2018 (Rs.)	Last date for claiming unpaid dividend amount (before)	Last date for transfer to IEPF
2010-2011	10/09/2011	4,72,019	14.10.2018	12.11.2018
2011-2012	29/09/2012	85,35,450	02.11.2019	01.12.2019

Shareholders are requested to get in touch with the RTA for encashing the unclaimed dividend/interest/principal amount, if any, standing to the credit of their account.

35. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment at workplace (Prevention, prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year ended 31^st March 2018, Company has not received any complaint of harassment.

36. LISTING WITH STOCK EXCHANGE

The Company confirms that it has paid the Annual Listing Fees for the year 2018-19 to BSE and NSE where the Companyâs Shares are listed.

37. SECRETARIAL STANDARDS

The Company has in place proper systems to ensure compliance with the provisions of the applicable secretarial standards issued by The Institute of Company Secretaries of India and such systems are adequate and operating effectively.

38. HUMAN RESOURCES

Your Company treats its âhuman resourcesâ as one of its most important assets.

Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company thrust is on the promotion of talent internally through job rotation and job enlargement.

39. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

There are no significant and material orders passed by the Regulators / Courts / Tribunals which would impact the going concern status of the Company and its future operations.

40. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

During the year under review, there have been no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report.

Further, the Board of Directors at their meeting held on 29^th March 2018 allotted 500000 equity shares to Promoters of the Company against the conversion of warrants issued on preferential basis.

41. ACKNOWLEDGEMENT

The Directors would like to thank all shareholders, customers, bankers, medical professionals, business associates, suppliers, distributors and everybody else with whose help, cooperation and hard work the Company is able to achieve the results. The Directors would also like to place on record their appreciation of the dedicated efforts put in by the employees of the Company.

For & on behalf of the Board of Directors of

Kilitch Drugs (India) Limited

Mukund Mehta Bhavin Mehta

[DIN: 00147876] [DIN: 00147895]

Managing Director Whole-Time Director

Place: Mumbai

Date: 13^th August 2018

Mar 31, 2016

DIRECTORSâ REPORT

To,

The Members,

KILITCH DRUGS (INDIA) LIMITED

The Directors have pleasure in presenting their 24^th Annual Report on the business and operations of your Company for the year ended March 31, 2016.

1. FINANCIAL RESULTS

The summarized financial performance of the Company for the FY 2015-16 and FY 2014-15 is given below:

[Amount in Rs. Lacs]

Particulars	Standalone		Consolidated
Particulars	2015 2016	2014 2015	2015 2016	2014 2015
Gross Income	2375.66	2171.75	2376.98	2174.48
Profit Before Tax, Interest and Depreciation	(87.71)	(100.95)	(158.13)	(90.55)
Finance Charges	NIL	NIL	NIL	NIL
Provision for Depreciation	161.25	185.39	1004.74	185.39
Net Profit/ (Loss) Before Tax	(248.96)	(84.44)	(1162.87)	(94.84)
Provision for Tax	43.61	65.90	43.78	65.90
Net Profit/ (Loss) After Tax	(205.35)	(18.54)	(1119.09)	(28.94)
Balance of Profit brought forward	6188.52	6207.07	6188.52	(10.39)
Balance available for appropriation	5983.17	6188.52	5983.17	884.48
Proposed Dividend on Equity Shares	NIL	NIL	NIL	NIL
Tax on proposed Dividend	NIL	NIL	NIL	NIL
Transfer to General Reserve	NIL	(6.75)	NIL	NIL
Surplus carried to Balance Sheet	5983.17	6188.52	5983.17	884.48

2. REVIEW OF OPERATIONS

During the year under review, the Company has posted total Income of Rs. 2375.66 Lacs as against Rs. 2171.75 Lacs for the corresponding previous year.

Further, Net Loss after tax for the year under review was Rs. (205.35) Lacs as against Net Loss of Rs. (18.54) Lacs for the corresponding previous year.

3. STATE OF AFFAIRS AND FUTURE OUTLOOK

The environment in which Pharmaceutical and Life Sciences companies operate is increasingly challenging, being driven by a more and more demanding healthcare agenda.

The global need for innovative, cost effective medicines continues to rise whilst regulators, payers, health care providers and patients are demanding greater value for money, proven effectiveness of products, more transparency and access to information. This global scenario has also affected us in a major way .

To meet these demands we are seeking ways to improve R&D productivity, increase the efficiency of our operations, rationalize spending on sales and marketing and enhance the financial performance.

With the backup of the seasoned professional management we have taken up the set up of 2 manufacturing units at Ethiopia and Burkina Faso primarily for the nutraceutical manufacturing. Up gradation of the manufacturing unit with state of the art machines and technology up gradation we are now ready to reach upcoming markets across the globe .

New markets, new product portfolio , innovative marketing techniques, new branding concepts have increased the momentum of the sales and expect the same to grow enormously in the coming year .

4. DIVIDEND AND RESERVES

In order to conserve the resources for the further growth of the Company, your Directors think fit not to recommend any dividend for the financial year under review.

5. SHARE CAPITAL

The Paid-up Equity Share Capital of the Company as on 31^st March, 2016 is Rs. 1323.18 Lacs, comprising of 13231828 shares of Rs. 10/- each. During the year under review, the Company has not issued any equity shares.

6. EMPLOYEE STOCK OPTION SCHEME:

As per Employee stock option Scheme (Kilitch ESOS 2007), each option is convertible into one equity shares of Rs.10/-each at exercise price of Rs.47.50 per share. During the year under review, fresh options were not granted and employees did not exercise any options. The employee compensation cost on account of this grant applicable for the year is Rs. Nil [P. Y. Rs. NIL].

7. DIRECTORS AND KEY MANAGERIAL PERSONNEL

At the 23^rd Annual General Meeting held on September 30, 2015, Mr. Mukund Mehta was re-appointed as the Director of the Company, liable to retire by rotation.

Further, Mr. Pankaj Kamdar and Mr. Hemang Engineer were appointed as Independent Directors of the Company to hold office for a period of 5 (five) consecutive years at the 23^rd Annual General Meeting.

The said Independent Directors fulfils the conditions specified in the Companies Act, 2013 and the Rules made there under and they are independent of the management and have submitted the declarations as prescribed under Section 149(6) of the Companies Act, 2013.

In accordance with section 152(6) of the Companies Act, 2013 and in terms of Articles of Association of the Company Mr. Deepu Panankattil (DIN: 03514959), Director of the Company, retires by rotation and being eligible; offers himself for re-appointment at the forthcoming 24^th Annual General Meeting. The Board recommends the said reappointment for shareholdersâ approval.

Further, Mr. Mukund Mehta is proposed to be reappointed as the Managing Director of the Company w.e.f. 30^th September 2016 for a period of 5 (five) years.

Also, Mr. Paresh Mehta resigned as the Jt. Managing Director of the Company w.e.f. 13^th April 2016.

Further, the Office of CFO became vacant due to untimely death of Mr. C.S. Kirshnan w.e.f. 12^th April 2016.

Also, Ms. Keerti Acharya was appointed as the Company Secretary in Whole time in employment w.e.f. 31^st March 2016 and, Mr. Nirmal Kumar tendered his resignation as the Company Secretary with effect from 15^th December, 2015.

8. DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) & 134(5) of the Companies Act, 2103, the Board of Directors of the Company hereby confirm that:

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(d) the directors have prepared the annual accounts on a going concern basis; and

(e) the directors have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

9. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURE

Further, the names of top ten employees in terms of remuneration drawn are disclosed in Annexure II and forms part of this Report.

10. NUMBER OF BOARD MEETINGS

A calendar of meetings is prepared and circulated in advance to the Directors. During the year, 6 (Six) Board Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and the Listing Agreement.

11. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and the Listing Agreement / SEBI (LODR) Regulations, 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees. The Directors expressed satisfaction with the evaluation process. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

12. INDEPENDENT DIRECTORS

13. NOMINATION AND REMUNERATION POLICY

14. EXTRACT OF ANNUAL RETURN:

The details forming part of the Extract of the Annual Return in Form MGT-9, as required under Section 92 of the Companies Act, 2013 is included in this Report as Annexure III and forms part of this Report.

15. DETAILS OF SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES

The Statement AOC-1 pursuant to the provisions of Section 129 (3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014 regarding Subsidiary Company is enclosed as Annexure IV to this Report.

16. STATUTORY AUDIT

At the Annual General Meeting held on 30^th September, 2014, M/s A.M. Ghelani & Co, Chartered Accountant were appointed as Statutory Auditors of the Company to hold office till the conclusion of the Annual General Meeting to be held in Calendar year 2016. In the terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the Auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s A.M. Ghelani & Co, Chartered Accountants, as Statutory Auditors of the Company, is placed for ratification by the Shareholders. In regard to the Company has received a Certificate from the Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

Auditors Report as issued by M/s A.M. Ghelani & Co, Chartered Accountants, Auditors of the Company is self explanatory and need not call for any explanation by your Board.

17. SECRETARIAL AUDIT

EXPLANATION(S)/ COMMENT(S) PURSUANT TO SECTION 134(3)(f)(ii), OF THE COMPANIES ACT, 2013:

1. Due to some technical reasons, the website of the Company faced some difficulties in proper functioning; however the said issues were sorted out and the website is working effectively.

2. The Company has faced technical difficulties in filing eforms on MCA portal and hence the same were pending. However the pending forms were subsequently filed by the company.

18. COST AUDIT

19. INTERNAL AUDIT & CONTROLS

The Company has in place adequate internal financial controls with reference to the financial statement. The Audit Committee of the Board periodically reviews the internal control systems with the management, Statutory Auditors. Significant internal audit findings are discussed and follow-ups are taken thereon. Further, M/s. Rishi Sekhri & Associates, Chartered Accountants, M.No.126656 were appointed as Internal Auditors of the Company.

20. COMPOSITION OF AUDIT COMMITTEE

Your Company has formed an Audit Committee as per the Companies Act, 2013 and the listing agreement / SEBI (LODR) Regulations, 2015. All members of the Audit Committee possess strong knowledge of accounting and financial management.

Further, the Audit Committee is functional as per the provision of Section 177 of Companies Act, 2013 and Rules made there under and as per Regulation 18 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The other details of the Audit Committee are given in the Corporate Governance Report, appearing as a separate section in this Annual Report.

21. VIGIL MECHANISM

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.kilitch.com. The employees of the Company are made aware of the said policy at the time of joining the Company.

22. RISK MANAGEMENT POLICY

The Company does not fall under the ambit of top 100 listed entities, determined on the basis of market capitalization as at the end of the immediately preceding financial year. Hence, compliance under Regulation 21 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is not applicable.

23. DEPOSITS

24. LOANS & GUARANTEES

During the year under review, the Company has not provided any loan, guarantee, security or made any investment covered under the provisions of Section 186 of the Companies Act, 2013 to any person or other body corporate.

25. INSURANCE

The properties/assets of the Company are adequately insured.

26. RELATED PARTY TRANSACTIONS

During FY 2015-16, the Company entered into certain Related Party Transactions which are in the ordinary course of business and at armâs length basis, with approval of the Audit Committee. The Audit Committee grants omnibus approval for the transactions which are of foreseen and repetitive nature. A detailed summary of Related Party Transactions is placed before the Audit Committee and the Board of Directors for their review every quarter.

Since all Related Party Transactions entered into by the Company were in ordinary course of business and were on an armâs length basis, Form AOC-2 is applicable to the Company and is enclosed a Annexure V to this report.

27. CORPORATE GOVERNANCE CERTIFICATE

28. CORPORATE SOCIAL RESPONSIBILITY

The Company does not meet the criteria of Section 135 of Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 so there is no requirement to constitute Corporate Social Responsibility Committee and frame a policy thereof.

29. MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report, which gives a detailed state of affairs of the Companyâs operations forms part of this Annual Report.

30. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

(A) Conservation of Energy:

i. steps taken or impact on conservation of energy;

ii. steps taken for utilizing alternate sources of energy;

The steps taken by the Company for utilizing alternate sources of energy: The Company is using electricity as the main source of energy and is currently not exploring any alternate source of energy.

iii. capital investment on energy conservation equipments; Our Company firmly believes that our planet is in dire need of energy resources and conservation is the best policy.

(B) Absorption of Technology:

I. The efforts made towards technology absorption:

The Company values innovation and applies it to every facet of its business. This drives development of distinctive new products, ever improving quality standards and more efficient processes.

II. Benefits derived as a result of the above efforts:

As a result of the above, the following benefits have been achieved:

a) Better efficiency in operations,

b) Reduced dependence on external sources for technology for developing new products and upgrading existing products,

c) Expansion of product range and cost reduction,

d) Greater precision,

e) Retention of existing customers and expansion of customer base,

f) Lower inventory stocks resulting in low carrying costs.

III. The Company has not imported any technology during the year under review;

IV. The Company has not expended any expenditure towards Research and Development during the year under review.

FOREIGN EXCHANGE EARNING AND OUTGO:

a) Earnings in Foreign Currency (Rs. In Lacs)

Earnings In Foreign	2015-2016	2014-2015
Currency
Export Sale	1460.81	951.31

b) Expenditure in foreign currency

(Rs. In Lacs)

Expenses In Foreign Currency	2015-2016	2014-2015
Business Promotion & Travelling	30.70	47.24
Export Registration	147.09	131.29
Export Expenses	0.06	0.61

31. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

As per the provision of Section 125 of the Companies Act, 2013 read with rule 4 of Companies (Declaration and Payment of Dividend) Rules, 2014, Dividend which remain unclaimed for the period of seven years are required to be transferred to the Investor Education Protection Fund administered by the Central Government.

Dates of declaration of dividends since 2008-2009 and the corresponding dates when unclaimed dividends are due to be transferred to the Central Government are given in the below table.

Financial Year Ended	Date of declaration of Dividend	Amount Remaining unclaimed/ Unpaid as on 31.03.2016 (Rs.)	Last date for claiming unpaid dividend amount (before)	Last date for transfer to IEPF
2008 2009	22.09.2009	3,33,103	31.07.2017	30.09.2017
2009 2010	20.10.2010	3,81,280	31.07.2018	30.09.2018
2010 2011	10.09.2011	4,75,219	31.07.2019	30.09.2019
2011 2012	29.09.2012	86,76,450	31.07.2020	30.09.2020

Members are requested to note that after completion of seven years, no claims shall lie against the said fund or company for the amounts of dividend so transferred, nor shall any payment be made in respect of such claims.

32. GENERAL

During the year ended 31^st March, 2016, there were no cases filed /reported pursuant to the Sexual Harassment of women at workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and Companyâs operations.

33. HUMAN RESOURCES

Your Company treats its âhuman resourcesâ as one of its most important assets.

34. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:

There are no significant and material orders passed by the Regulators / Courts / Tribunals which would impact the going concern status of the Company and its future operations.

35. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There have been no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report.

36. ACKNOWLEDGEMENT

For and on behalf of the Board of Directors

MUKUND MEHTA BHAVIN MEHTA

MANAGING

WHOLE-TIME DIRECTOR DIRECTOR

[DIN: 00147876] [DIN:00147895]

Place: Mumbai

Date: August 12, 2016

Mar 31, 2015

The Directors have pleasure in presenting their 23rd Annual Report on the Audited Statement of Accounts of the Kilitch Drugs (India) Limited ["Company"] for the Financial Year ended March 31, 2015.

1. FINANCIAL RESULTS

The summarized fnancial performance of the Company for the FY 2014-15 and FY 2013-14 is given below:

[Rs,in lacs]

Particulars Standalone Consolidated

2014- 2015 2013-2014 2014-2015

Gross Income 2171.76 2118.92 2174.82

Proft Before 100.95 250.28 90.55 Tax, Interest and Depreciation

Finance Charges 0.00 0.00 0.00 Provision for 185.39 143.97 185.39 Depreciation

Net Proft/ (Loss) (84.44) 106.29 (94.84) Before Tax

Tax Expense 65.90 11.35 65.90

Net Proft/ (Loss) After (18.55) 117.64 (28.94) Tax

Balance of Proft (18.55) 117.64 - brought forward

Balance available for NIL 117.64 - appropriation

Proposed Dividend on NIL NIL - Equity Shares

Tax on proposed NIL NIL - Dividend

Transfer to General NIL NIL - Reserve

Surplus carried to (18.55) 117.64 (28.94) Balance Sheet

2. REVIEW OF OPERATIONS

During the year under review, the Company has posted total Income of Rs, 2171.76 Lacs as against Rs, 2118.92 Lacs for the corresponding previous year.

Further, Net Loss after tax for the year under review was Rs, (18.55) Lacs as against a Net Proft of Rs, 117.64 Lacs for the corresponding previous year.

3. DIVIDEND AND RESERVES

In order to conserve the resources for the further growth of the Company, your Directors think ft not to recommend any dividend for the fnancial year under review.

FUTURE OUTLOOK:

As we look ahead, we have set clear goals and aspirations for our next set of milestones. In the medium term, building on proven results, we are leveraging the power of our carefully developed product portfolio, relationships built over a long period and a diversifed customer mix. Further, we have an optimized cost structure, robust balance sheet and a highly seasoned professional management.

With the ongoing projects of 2 new manufacturing units at Ethiopia & Burkina Faso & incorporation of latest technology and capacity expansion at our Thane factory, we expect speedy positive growth rates. Our Company is well placed to capitalize on the opportunities arising out of such upcoming markets worldwide. Combined with new marketing and branding concepts and improved product portfolio, we will see increased momentum in the coming years. Innovation & Quality remains at the core of all Kilitch initiatives and hence we shall continue to invest in R&D. Even though the economy remains subdued now, we believe it can grow faster, due to the expansion of its international presence and innovative product portfolio. Our company is well positioned to leverage on opportunities worldwide.

Focus on Global Business

Our company sets the pace when it comes to providing innovative and customer-centric services to the world's emerging markets having footprints across the globe. Our strength is defned by our major presence in most of the West African countries along with few other African countries. We are now one of the major suppliers for many of the Ministry of Health in Francophone countries particularly, Burkina Faso. Our innovative product offerings have made us to enter successfully in new emerging markets like South East Asia , CIS countries & Gulf countries.

A strong entrepreneurial spirit of our international alliance remains one of our quickest & surest routes to success in the years ahead.

HUMAN RESOURCE

Personal and professional employee development is crucial for any growing business and Kilitch is a company that gets it all! Our HR department served as a strategic partner in the transition, keeping its eye on the ball during a sensitive time by focusing on delivering HR fundamentals and, in so doing, helping preserve and strengthen the company's brand, culture and business objectives. During the year, the department focused on delivering HR programs that built on the company's existing foundations. These included a recruitment program involving leaders and peers in the hiring process, employee engagement programs, learning and development programs refecting established values and competencies. As a part of Orientation Package for all new hires of kilitch we have introduced a KCB (Kilitch Cultural Book) this year, which helped us a lot to understand the views ,ideas and also Grievance (if any) of the employees. We have received a very good response and we are trying to work in the areas where we are lacking.

4. SHARE CAPITAL

The Paid-up Equity Share Capital of the Company as on 31st March, 2015 is Rs, 1323.18 Lacs, comprising of 13231828 shares of Rs, 10/- each. During the year under review, the Company has not issued any equity shares.

5. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Mukund Mehta, Managing Director of the Company, retires by rotation being eligible; offers himself for reappointment at the forthcoming Annual General Meeting. The Companies Act, 2013 (the Act) provides for appointment of independent Directors. Sub section (10) of Section 149 of the Companies Act, 2013 (effective from April 1, 2014) provides that independent directors shall hold offce for a term of up to fve consecutive years on the Board of a Company, but shall be eligible for re-appointment on passing of a special resolution by the company in the Annual General Meeting and disclosure of such appointment in the Board's report. Sub-section (11) states that no independent director shall be eligible to hold offce for more than two consecutive terms of fve years. Sub- section (13) states that the provisions of retirement by rotation as defned in sub-section (6) and (7) of Section 152 of the Act shall not apply to such independent director.

Accordingly, Mr. Ramesh Modi has been appointed as an Independent Director with effect from 31st March, 2015, for term of 5 years.

The terms and conditions of appointment of Independent Directors are as per Schedule IV of the Act. Declaration for meeting the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement entered into with Stock Exchanges has been received.

Further, Ms. Nilima Waingankar has resigned as Director of the Company w.e.f. 1st March, 2015.

Mr. Nirmal Kumar has been appointed as Company Secretary w.e.f. 1st October, 2014 and Mr. C.S. Krishnan has been appointed as Chief Financial Offcer w.e.f. 31st March, 2015.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) & 134(5) of the Companies Act, 2103, the Board of Directors of the Company hereby confrm that:

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) the directors have selected such accounting policies and

applied them consistently and made judgments and estimates that are 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 fnancial year and of the proft and loss of the company for that period;

(c) the directors have taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors have prepared the annual accounts on a going concern basis; and

(e) the directors have laid down internal fnancial controls to be followed by the company and that such internal fnancial controls are adequate and were operating effectively.

(f) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

7. PARTICULARS OF MANAGERIAL REMUNERATION 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, is enclosed as Annexure I and forms part of this Report.

Further, as per the provisions specifed in Chapter XIII of Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 none of the employees of the Company are in receipt of remuneration exceeding Rs, 60,00,000/- per annum, if employed for whole of the year or Rs, 5,00,000/- per month if employed for part of the year.

8. NUMBER OF BOARD MEETINGS

A calendar of meetings is prepared and circulated in advance to the Directors. During the year, 12 Board Meetings were convened and held, the details of which are given in the Corporate Governance Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and the Listing Agreement.

9. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees. The Directors expressed satisfaction with the evaluation process. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

10. INDEPENDENT DIRECTORS

The Independent Directors have submitted their disclosure to the Board that they fulfll all the requirements as to qualify for their appointment as Independent Director, under the provisions of section 149 of the Companies Act, 2013 as well as Clause 49 of the Listing Agreement.

11. NOMINATION AND REMUNERATION POLICY

The Board of Directors has framed a policy which lays down a framework in relation to remuneration of Directors. This policy also lays down criteria for selection and appointment of Board Members. The details of this policy are provided on the website of the Company on the given link: www.kilitch.com

12. DETAILS OF SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES

The Statement AOC-1 pursuant to the provisions of Section 129 (3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014 regarding Subsidiary Company is enclosed as Annexure IV to this Report.

13. STATUTORY AUDIT

At the Annual General Meeting held on September 30th, 2014, M/s A.M. Ghelani & Co, Chartered Accountant were appointed as Statutory Auditors of the Company to hold offce till the conclusion of the Annual General Meeting to be held in Calendar year 2017. In the terms of the frst proviso to Section 139 of the Companies Act, 2013, the appointment of the Auditors shall be placed for ratifcation at every Annual General Meeting. Accordingly, the appointment of M/s A.M. Ghelani & Co, Chartered Accountants, as Statutory Auditors of the Company, is placed for Ratifcation by the Shareholders. In regard to the Company has received a Certifcate from the Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013.

Auditors Report as issued by M/s A.M. Ghelani & Co, Chartered Accountants, Auditors of the Company is self explanatory and need not call for any explanation by your Board.

14. COST AUDIT

As per the Cost Audit Orders and in terms of the provisions of Section 148 and all other applicable provisions of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, Cost Audit is not applicable to our Company.

15. SECRETARIAL AUDIT

In terms of Section 204 of the Act and Rules made there under, M/s. Deep Shukla & Associates, Practicing Company Secretary, have been appointed Secretarial Auditors of the Company. The Secretarial Audit Report is enclosed as Annexure V to this report.

Report as issued by M/s Deep Shukla & Associates, Practicing Company Secretary, Secretarial Auditors of the Company is self explanatory and need not call for any explanation by your Board.

16. INTERNAL AUDIT & CONTROLS

The Company has in place adequate internal fnancial controls with reference to the fnancial statement. The Audit Committee of the Board periodically reviews the internal control systems with the management, Statutory Auditors. Signifcant internal audit fndings are discussed and follow-ups are taken thereon. Further, M/s. Rishi Sekhri & Associates, Chartered Accountants, M.No.126656 were appointed as Internal Auditors of the Company w.e.f. 12/02/2015

17. COMPOSITION OF AUDIT COMMITTEE

The Audit Committee of the Company as on 31st March, 2015 comprised of four Independent Directors, namely Mr. Mukesh Shah, Mr. Shailesh Chheda, Mr. Hemang Engineer and Mr. Pankaj Kamdar. Mr. Mukesh Shah is the Chairman of the Committee. All members of the Audit Committee possess strong knowledge of accounting and fnancial management. The Managing Director, Executive Director and Director (Finance) are regularly invited to attend the Audit Committee meetings. The Company Secretary is the Secretary to the Committee. The other details of the Audit Committee are given in the Corporate Governance Report, appearing as a separate section in this Annual Report.

18. EMPLOYEES' STOCK OPTION PLAN

As per Employee stock options Scheme (Kilitch ESOS 2007), each option is convertible into one equity shares Rs, 10/- each at exercise price of Rs, 47.50/- per share. During the year fresh options were not granted and employees did not exercise any options.

The employee compensation cost on account of this grant applicable for the year is Rs, Nil [ P. Y. Rs, NIL].

19. VIGIL MECHANISM

In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.kilitch.com The employees of the Company are made aware of the said policy at the time of joining the Company.

20. RISK MANAGEMENT POLICY

The Company has laid down the procedure to inform the Board about the risk assessment and minimization procedures. These procedures are reviewed by the Board annually to ensure that there is timely identifcation and assessment of risks, measures to mitigate them, and mechanisms for their proper and timely monitoring and reporting.

21. EXTRACT OF ANNUAL RETURN:

The details forming part of the Extract of the Annual Return in Form MGT-9, as required under Section 92 of the Companies Act, 2013 is included in this Report as Annexure II and forms part of this Report.

22. DEPOSITS

The Company has not accepted nor renewed any fxed deposits during the FY 2014-15.

23. LOANS & GUARANTEES

During the year under review, the Company has not provided any loan, guarantee, security or made any investment covered under the provisions of Section 186 of the Companies Act, 2013 to any person or other body corporate. except lien on investment at Kotak Bank for overdraft /letter of credit. Till today none of the facilities is being used.

24. INSURANCE

The properties/assets of the Company are adequately insured.

25. RELATED PARTY TRANSACTIONS

During FY 2014-15, the Company entered into certain Related Party Transactions which are in the ordinary course of business and at arm's length basis, with approval of the Audit Committee. The Audit Committee grants omnibus approval for the transactions which are of foreseen and repetitive nature. A detailed summary of Related Party Transactions is placed before the Audit Committee & the Board of Directors for their review every quarter.

There are no materially signifcant Related Party Transactions executed between the Company and its Promoters, Directors, key Managerial Personnel or other designated persons, that may have a potential confict with the interest of the Company at large.

Since all Related Party Transactions entered into by the Company were in ordinary course of business and were on an arm's length basis, Form AOC-2 is applicable to the Company as per Annexure III.

26. CORPORATE GOVERNANCE CERTIFICATE

A Report on Corporate Governance alongwith a certifcate from the Practicing Company Secretary regarding the compliance of conditions of corporate governance as stipulated under Clause 49 of the Listing Agreement forms a part of this Annual Report.

27. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

POWER AND FUEL CONSUMPTION 2014-15 2013-14

a) Electricity

Purchased Unit (Rs, In thousand) 841 957

Total Amount (Rs, In thousand) 7490 7259

Rate/Unit (Amount in thousand) 8.90 7.59

b) Own Generator

Fuel (Diesel) LTRS 229 16

Total Amount (Rs, In thousand) 13 1

Rate per Litre (Rs,) 56.81 62.50

Fuel ( Furance Oil)(MT) 27 65

Total Amount (Rs, In thousand) 1205 2822

Rate per Litre (Rs,) 45.22 43.41

TECHNOLOGY ABSORPTION AND INNOVATION:

During the year under review, the Company has not imported any technology.

28. TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

As per the provision of Section 125 of the Companies Act, 2013 read with rule 4 of Companies (Declaration and Payment of Dividend) Rules, 2014, Dividend which remain unclaimed for the period of seven years are required to be transferred to the Investor Education Protection Fund administered by the Central Government. The Company has already fled the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last AGM (i.e. 30th September,2014), with the Ministry of Corporate Affairs.

Dates of declaration of dividends since 2007-2008 and the corresponding dates when unclaimed dividends are due to be transferred to the Central Government are given in the below table.

Financial Date of Amount Last Last Year declaration Remaining date for date for Ended of Dividend unclaimed/ claiming transfer to Unpaid unpaid IEPF as on dividend 31.03.2014 amount (Rs,) (before)

2007-08 22.09.2008 7,03416 31.07.2016 30.09.2016

2008-09 22.09.2009 3,33,103 31.07.2017 30.09.2017

2009-10 20.10.2010 3,81,280 31.07.2018 30.09.2018

2010-11 10.09.2011 4,75,219 31.07.2019 30.09.2019

2011-12 29.09.2012 86,76,450 31.07.2020 30.09.2020

Members are requested to note that after completion of seven years, no claims shall lie against the said fund or company for the amounts of dividend so transferred, nor shall any payment be made in respect of such claims.

29. GENERAL

During the year ended 31st March, 2015, there were no cases fled /reported pursuant to the Sexual Harassment of women at workplace (Prevention, Prohibition and Redressal) Act, 2013. The Company confrms that it has paid the Annual Listing Fees for the year 2015-2016 to BSE and NSE where the Company's Shares are listed.

During the year under review, no signifcant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and Company's operations.

30. HUMAN RESOURCES

Your Company treats its "human resources" as one of its most important assets.

Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company thrust is on the promotion of talent internally through job rotation and job enlargement.

31. ACKNOWLEDGEMENT

The Directors would like to thank all shareholders, customers, bankers, suppliers and everybody else with whose help, cooperation and hard work the Company is able to achieve the results. The Directors would also like to place on record their appreciation of the dedicated efforts put in by the employees of the Company.

For and on behalf of the Board of Directors

Place: Mumbai Mukund Mehta Bhavin Mehta

Date: August 14, 2015 Managing Director Whole-Time Director

[Din:00147876] [Din:00147895]

Mar 31, 2014

The Members

KILITCH DRUGS (INDIA) LIMITED

The Directors have pleasure in presenting their 22nd Annual Report together with the Audited Statement of Accounts of the Company for the financial year ended March 31, 2014.

[Rs. in lacs]

PARTICULARS FY. 2013-14 F.Y. 2012-13

Total Income 2,118.92 4239.61

Profit (Loss) before Interest, Tax, 250.27 547.15

Depreciation and Exceptional Items.

Less: Depreciation 143,97 122.90

Less: Interest Charges - 01.22

Profit/(Loss) before extraordinary 106.30 423.03 items and Taxation

Add/(Less) : Extraordinary Items - (95,46)

Profit/(Loss) before Taxation 106.30 327.58

Less: Provision for Taxation

- Current Year. - -

- Deferred Tax. (10.35) (0.71)

- Tax Adjustments of earlier years (01.00) -

Profit/(Loss) after Taxation 117.65 328.28

Earnings Per Share (per share)

- Basic 0.89 2.48

-Diluted 0.89 2.44

REVIEW OF PERFORMANCE:

During the year under review, Net Profit after.Tax was Rs.117.65 lacs as against Net Profit after Tax ofRs. 328.28 lacs for the corresponding previous year.

DIVIDEND:

In order to conserve the resources for the further growth of the Company, your Directors think fit not to recommend any dividend for the financial year under review.

FUTURE OUTLOOK:

Company aims at " Making India proud through innovative quality medicines". Considering this aim the company''s future vision is to add more innovative products to our product list facilitating domestic as well as international growth of the business of the company and which assists in making human and animal life healthier.

Continuous expansion of Exports remains one of the major vision of the company. Striving to become the No.l exporter to French West African countries, the Senior management is on the task of penetrating and expanding the business in all Francophone countries and West African countries as the same holds great potential et for the business.

In line with the steps taken to focus and expand exports, Company''s export business is expected to pick up substantially.

FOCUS ON GLOBAL BUSINESS

The Company''s focus is on exploring and penetrating of new markets. The Company tries to grab every possible opportunity of expansion in global market, which is also being closely monitored by Senior Managers and Directors, who also work towards promotion and marketing of our branded products.

These opportunities are expected to gather momentum and bring good business. We have been trying to register all our products in international markets and have been able to successfully get registration for our products in the West African countries.

Also, as a part of spreading our business globally we were successful in getting our products registered in the South East Asian countries. The company expects to achieve excellent business in these''markets and is also in continuously trying to search for new markets and opportunities.

ON HUMAN RESOURCE

The year has been quite significant in our efforts in human resource development where in several initiatives were rolled out. The main focus area in Human Resource was towards recruitment of highly skilled and qualified professionals for the respective functions. The Human Resource development is aimed at overall growth and development of. employees which in turn helps in the overall growth and development of the company.

Also, Talent management was taken up as a specific focus area in HR towards integrating employee development and succession planning. Employee engagement is one of the key focus for the success of our organisation.

DIRECTORS:

During the year under review, Mr. Bhavin Mehta, Director of the Company, retires by rotation and being eligible offers himself for reappointment at the forthcoming Annual General Meeting.

Further, Mrs. Mira Mehta and Mr. Deepu Kesavan Pannankattil were appointed as an Additional Directors of the Company w.e.f. October 17, 2013 and were re-designated as the Whole time Directors of the Company for a period of five and three years respectively w.e.f. November 14, 2013, subject to the approval of the members of the Company in the ensuing Annual General Meeting.

The Companies Act, 2013 (the Act) provides for appointment of independent directors. Sub-section (10) of Section 149 of the Companies Act, 2013 (effective from April 1, 2014) provides that independent directors shall hold office for a term of up to five consecutive years on the Board of a company; and shall be eligible for re-appointment on passing of ordinary resolution by the shareholders of the company.

Sub-section (1) states that no independent director shall be eligible for more than two consecutive terms of five years. Sub-section (13) states that the provisions of retirement by rotation as defined in sub- sections (6) and (7) of Section 152 of the Act shall not apply to such independent directors.

The non-executive independent directors were appointed as directors liable to retire by rotation under the provisions of the erstwhile Companies Act, 1956. The Board of Directors has been advised that non executive (independent) directors so appointed would continue to serve the term that was ascertained at the time of appointment as per the resolution pursuant to which they were appointed. Therefore, it stands to reason that only those non- executive (independent) directors who will complete their present term at the ensuing AGM of the Company in September 2014, being eligible and seeking re-appointment, be considered by the shareholders for re-appointment for a term of upto five consecutive years. Non-executive (independent) directors who do not complete their term at the ensuing AGM, will continue to hold office till the expiry of their term (based on retirement period calculation) and thereafter would be eligible for re-appointment for a fixed term in accordance with the Companies Act, 2013.

Further, Mr. Shailesh Chheda and Mr. Mukesh Shah were appointed as Independent Directors of the Company for a tenn of five consecutive years effective from April 1,2014 upto March 31, 2019 not liable to retire by rotation.

FIXED DEPOSITS:

The Company has not accepted any loans or deposits from public in pursuant to Section 58A of the Companies Act, 1956, and rules framed under the Companies (Acceptance of Deposits) Rules, 1975. AUDITORS:

M/s. A.M. Ghelani & Co., Chartered Accountants, Auditors of the Company retires at the conclusion of ensuing Annual General Meeting and has expressed their willingness to continue as the Statutory Auditors of the Company.

AUDITORS'' REPORT: Auditors Report as issued by M/s. A.M. Ghelani & Co., Chartered Accountants, Auditors'' of the Company is self explanatory and need not call for any explanation by your Board.

TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION:

During the year under review, the Company has not imported any technology.

PARTICULARS OF EMPLOYEES:

The Company considers human resources as its greatest asset and strength in the process of development and progress. In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended by the Companies (Particulars of Employees) Rules, 2011, none of the employees of the company are in receipt of remuneration exceeding Rs. 60,00,000/- per annum, if employed for whole of the year or Rs. 5,00,000/- per month if employed for part of the year.

INSURANCE:

All properties of the Company including factory, building, plant & machinery. Stock are adequately insured.

MANAGEMENT DISCUSSION AND ANALYSIS:

The Report on Management Discussion and Analysis as required under the Listing Agreement with The Stock Exchanges is enclosed to this Report. Certain statements in this section may be forward looking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of the future performance and outlook EMPLOYEE STOCK OPTION SCHEME:

As per Employee stock options Scheme (Kilitch ESOS 2007), each option is convertible into one equity shares Rs. 10/- each at exercise price ofRs. 47.50/- per share. During the year fresh options were not granted and employees did not exercise any options.

The employee compensation cost on account of this grant applicable for the year is Rs. Nil [P. Y. Rs. 8.95 Lacs].

DIRECTORS'' RESPONSIBILITY STATEMENT:

In pursuant to Sec. 217(2AA), the Board do and hereby states:

i. that in the preparation of annual accounts for the Financial year 2013-14, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had selected such accounting policies and applied them consistently and made judgments and estimated that are 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 of the company for that period.

iii. that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. that the Directors had prepared the annual accounts on a going concern basis.

RENAMING OF THE COMMITTEES OF THE COMPANY:

Pursuant to the provisions of the Companies Act, 2013, the following committees of the Company have been renamed:

- Stakeholders Relationship (formerly Shareholders / Investors Grievance) Committee

- Nomination and Remuneration Committee (formerly Remuneration Committee):

CORPORATE GOVERNANCE:

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBT ''Umpany continued to believe in and accordingly upgra;Â» l-e. with concept of Corporate Governance. The company successfully maintained a code of Corporate Governance in all its concerned operations comprehensively. Corporate Governance and Management Discussion & Analysis Report forms part of this Annual Report. The Company has obtained a Certificate from Practicing Company Secretary for maintenance of Code of Corporate Governance. APPRECIATION:

Your Directors place on record their sincere appreciation of the service rendered by the employees of the Company and the Banks. Your Directors are also grateful to shareholders of the Company and local authorities for their continued valuable support and co- operation to the Company.

For and On behalf of the Board of Directors

Place: Mumbai Mukund P.Mehta Bhavin M. Mehta

Date: 14/08/2014 Managing Director Executive Director

Mar 31, 2013

To The Members

The Directors have pleasure in presenting their 21s1 Annual Report together with the Audited Statement of Accounts of the Company for the financial year ended March 31, 2013.

FINANCIAL RESULTS:

[Rs. in Lacs]

PARTICULARS F.Y. 2012-13 F.Y. 2011-12

Total Income 4233.13 10,796.24

Profit (Loss) before Interest,

Tax, Depreciation and Exceptional Items 554.32 1,520.14

Less: Depreciation 122.90 483.37

Less: Interest Charges 8.39 288.77

Profit/(Loss) before exceptional and extraordinary items and Taxation 423.03 748.00

Add/(Less): Exceptional Items (1,552.82)

Add/(Less): Extraordinary Items (95.46) 10,704.79

Profit/(Loss) before Taxation 327.57 9,899.97

Less : Provision for Taxation

- Current Year 2,105.00

- Deferred Tax (0.71) Profita Loss) after Taxation 328.28 7,794.97

Balance brought forward 5761.12 3,379.96

Less : Appropriations

Proposed dividend 3969.55

Dividend distribution tax 644.26

Transfer to Reserves 800.00

Balance Carried to Balance Sheet 6089.40 5,761.12

Earnings Per Share (Rs. per share)

- Basic 2.48 58.91

- Diluted 2.48 53.68

REVIEW OF PERFORMANCE:

During the year under review, Net Profit after Tax was Rs.328.28 lacs as against Net Profit after Tax of Rs. 7,794.97 lacs for the corresponding previous year. Previous year includes surplus on sale of an undertaking.

DIVIDEND:

In order to conserve the resources for the further growth of the Company, your Directors think fit not to recommend any dividend for the financial year under review.

FUTURE OUTLOOK:

The countries where your Board has targeted the export business are some of the fast developing countries with ample scope for business enhancement. Your Company has already registered many products in these markets and expect to receive further registrations in the coming financial year .Your Board expect to launch the products of the Company in other eight countries in the coming year thereby increasing the export volumes substantially. Your company is also on the continuous lookout of new avenues for business development in these countries .

FOCUS ON GLOBAL BUSINESS:

Your company has ear marked exports as the key focus area for future growth of the company. Having an enthusiastic and experienced marketing team your company has already penetrated into the lucrative Francophone countries already.In order to increase the export business volumes various activities are planned as the potential business growth in export has been already envisaged and formulated by the senior management. Your Board expects to take your company to greater heights in the coming years.

FOCUS ON HUMAN RESOURCE

The year 2012-2013, was the year of innovation for Human Resource Department. A good team of working professionals is the backbone of a successful organization. Human Resource Department incorporated modern HR practices in terms of Talent Management, Employee Engagement and Employee Development.

Our motto is to recognize, maintain and develop the existing resource.We have also taken initiatives to use new methodologies whereby the efficiency and the productivity is enhanced.

DIRECTORS:

During the year under review, Mr. Mukesh Shah and Mr. Pankaj Kamdar, Directors of the Company, retire by rotation and being eligible offer themselves for reappointment at the forthcoming Annual General Meeting.

FIXED DEPOSITS:

The Company has not accepted any loans or deposits from public in pursuant to Section 58A of the Companies Act, 1956, and rules framed under the Companies (Acceptance of Deposits) Rules, 1975.

AUDITORS:

M/s. R.N.R. Iyer & Co., Chartered Accountants, Auditors of the Company retires at the conclusion of ensuing Annual General Meeting and has expressed their unwillingness to continue as the Statutory Auditors of the Company.

Consequently, necessary arrangements are made and eligibility certificate under Section 224 (IB) of the Companies Act, 1956 from M/s. A.M. Ghelani & Co., Chartered Accountants, has been received for their appointment subject to approval of the members of the Company.

AUDITORS''REPORT:

Auditors Report as issued by M/s.R.N.R. Iyer & Co., Chartered Accountants, Auditors'' of the Company is self explanatory and need not call for any explanation by your Board.

PARTICULARS OF EMPLOYEES:

The Company considers human resources as its greatest asset and strength in the process of development and progress. In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended by the Companies (Particulars of Employees) Rules, 2011, none of the employees of the company are in receipt of remuneration exceeding Rs. 60,00,000/- per annum, if employed for whole of the year or Rs. 5,00,000/- per month if employed for part of the year.

INSURANCE:

All properties of the Company including factory, building, plant & machinery, Stock are adequately insured.

MANAGEMENT DISCUSSION AND ANALYSIS:

The Report on Management Discussion and Analysis as required under the Listing Agreement with The Stock Exchanges is enclosed to this Report. Certain statements in this section may be forward looking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of the future performance and outlook

EMPLOYEE STOCK OPTION SCHEME:

During the year under review, Options were not exercised under Kilitch ESOS 2007. Further options were not granted during the year. Details of the same are given in the annexure to this report.

DIRECTORS'' RESPONSIBILITY STATEMENT:

In pursuant to Sec. 217(2AA), the Board do and hereby states:

i. that in the preparation of annual accounts for the Financial year 2012-13, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had selected such accounting policies and applied them consistently and made judgments and estimated that are 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 of the company for that period.

iii. that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. that the Directors had prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Company continued to believe in and accordingly upgrade itself with concept of Corporate Governance. The company has successfully maintained a code of Corporate Governance in all its concerned operations comprehensively. Corporate Governance and Management Discussion & Analysis Report forms part of this Annual Report. The Company has obtained a Certificate from Practicing Company Secretary for maintenance of Code of Corporate Governance.

APPRECIATION:

Your Directors place on record their sincere appreciation of the service rendered by the employees of the Company and the Banks. Your Directors are also grateful to shareholders of the Company and local authorities for their continued valuable support and co-operation to the Company.

For and On behalf of the Board of Directors

Place: Mumbai Mukund P.Mehta Paresh P.Mehta

Date : 14/08/2013 Managing Director JointManaging Director

Mar 31, 2012

The Directors have pleasure in presenting their 20th Annual Report together with the Audited Statement of Accounts of the Company for the year ended March 31,2012.

FINANCIAL RESULTS:

(Rs. in Lacs)

PARTICULARS F.Y. 2011-12 F.Y. 2010-11

Total Income 10,796.24 14,622.36 Profit (Loss) before Interest, Tax, Depreciation and Exceptional Items 1,526.70 2,235.68

Less: Depreciation 483.37 558.74

Less: Interest Charges 295.33 368.81

Profit/(Loss) before exceptional and 748.00 1,308.13 extraordinary items and Taxation

Add/(Less): Exceptional Items (1,552.82) Nil

Add/(Less): Extraordinary Items 10,704.79 Nil

Profit (Loss) before Taxation 9,899.97 1,308.13 Less: Provision for Taxation

-Current Year 2,105.00 261.00

-Deferred Tax - 1.07

Profit (Loss) after Taxation 7,794.97 1,046.06

Balance brought forward 3,379.96 2,588.19 Less: Appropriations

- Proposed dividend 3969.55 132.32

- Dividend distribution tax 644.26 21.97

- Transfer to Reserves 800.00 100.00 Balance Carried to Balance Sheet 5,761.12 3,379.96 Basic Earnings Per Share (Rs.per share) 58.91 7.91

REVIEW OF PERFORMANCE:

During the year under review, Net Profit after Tax was Rs. 7,794.97 lacs as against Net Profit after Tax ofRs. 1,046.06 lacs for the corresponding previous year. The said increase in Net profit of the Company is result of slump sale and transfer of business undertaking located at Paonta Sahib, Himachal Pradesh.

DIVIDEND:

Considering the aforesaid sale of assets, the Board of Directors declared Special Interim Dividend @300% [i.e. Rs. 30/- per share on Rs. 10/- face value] on the equity share capital of the Company. Further, the Board not recommend any additional dividend for the financial year 2011-2012 and hence the said Special Interim Dividend be considered as the Final Dividend.

SALE OF BUSINESS:

During the year under review, the Company sold its business located at Paonta Sahib, Himachal Pradesh as a going concern on a slump sale basis along with transfer of services of related employees on the terms and condition as set forth in the Business Transfer Agreement (BTA). The undertaking was sold and transferred on 28th February 2012 after getting all the necessary clearances as indicated in the BTA. The Company has retained its Name, Trademark (Kilitch) and all other properties and assets at Mumbai.

The Company also transferred certain products by entering into a Product Transfer Agreement (PTA) with Akorn India Pvt. Ltd. (AIPL) by which the right to manufacture certain products by the Company at Mumbai were sold to AIPL.

The above referred sale and transfer of business was approved by the Members of the Company through Postal Ballot conducted by the Company.

FUTURE OUTLOOK:

After the sale of Paonta Sahib Facility Company now has in its fold 1) Mumbai Plant 2) APP 15 Countries Export.

In most of countries which remain with for the Company for export which are fastest developing countries and we propose to register all our products during this year in these countries.

Senior management is on the job of penetrating the business in all Francophone countries and south Sudan as the same hold great potential for the business.

In line with the steps being taken to focus on exports, Company's export business volume is expected to pick up substantially.

FOCUS ON HUMAN RESOURCE:

The year 2011-12 has been quite significant for human resource where several initiatives were taken forward. Talent management was taken up as a specific focus area in HR towards integrating employee development and successful planning.

Employee engagement is one of the key elements in the success of our organization. Your organization has embarked upon a path for building up the same through appreciative enquiry methodology.

DIRECTORS:

During the year under review, Mr. Shailesh Chheda and Mr. Hemang Engineer, Directors of the Company, retire by rotation and being eligible offer themselves for reappointment at the forthcoming Annual General Meeting.

Further, Mr. Bhavin Mehta is being designated as the Executive Director of the Company for a period of five years w.e.f. September 1,2012.

FIXED DEPOSITS:

The Company has not accepted any loans or deposits from public in pursuant to Section 58A of the Companies Act, 1956, and rules framed under the Companies (Acceptance of Deposits) Rules, 1975.

AUDITORS:

M/s RNR Iyer & Co., Chartered Accountants, Auditors of the Company retire at the conclusion of this Annual General Meeting. The members are requested to appoint auditors and to fix their remuneration.

EXPLANATION U/S. 217(3) OF THE COMPANIES ACT, 1956 ON THE OBSERVATIONS IN THE AUDITORS' REPORT:

i. Note No. 3 (f) regarding Gratuity:

The clarification regarding said observation by the Auditors is given in Note No. 1 -K of Significant Accounting Policies.

STATEMENT U/S. 212 REGARDING SUBSIDIARY COMPANY:

The Statement pursuant to the provisions of Sectio 1212 of the Companies Act, 1956 regarding Subsidiary Company is annexed to this Report.

TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION:

During the year under review, the Company has not imported any technology.

PARTICULARS OF EMPLOYEES:

The Company considers human resources as its greatest asset and strength in the process of development and progress. In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended by the Companies (Particulars of Employees) Rules, 2011, none of the employees of the company are in receipt of remuneration exceeding Rs. 60,00,000/- per annum, if employed for whole of the year or Rs. 5,00,000/- per month if employed for part of the year.

INSURANCE:

All properties of the Company including factory, building, plant & machinery, Stock are adequately insured.

MANAGEMENT DISCUSSION AND ANALYSIS:

The Report on Management Discussion and Analysis as required under the Listing Agreement with The Stock Exchanges is enclosed to this Report. Certain statements in this section may be forward looking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of the future performance and outlook

EMPLOYEE STOCK OPTION SCHEME:

As per Employee stock options Scheme (Kilitch ESOS 2007), each option is convertible into one equity shares Rs. 10/- each at exercise price ofRs. 47.50 per share. During the year fresh options were not granted and employees did not exercise any options. However, due to separations, 87150 options were surrendered and are available for reissue. 73 employees have been shifted to Akom India Pvt. Ltd. after the execution of deal for sale of part of business during the year. As these employees have technically separated from Company due to sale of business, it was decided that options held by them will be available for exercise as long as such employees are in the service of Akorn India Pvt. Ltd. Details of the same are given in the annexure to this report.

DIRECTORS' RESPONSIBILITY STATEMENT:

In pursuant to Sec. 217(2AA), the Board do and hereby states:

i. that in the preparation of annual accounts for the Financial year 2011- 12, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had selected such accounting policies and applied them consistently and made judgments and estimated that are 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 of the company for that period.

iii. that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. that the directors had prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

The Company is committed to maintain the highest standard of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Company continued to believe in and accordingly upgrade itself with concept of Corporate Governance. The company has successfully maintained a code of Corporate Governance in all its concerned operations comprehensively. Corporate Governance and Management Discussion & Analysis Report forms part of this Annual Report. The Company has obtained a Certificate from Practicing Company Secretary for maintenance of Code of Corporate Governance. APPRECIATION:

Your Directors place on record their sincere appreciation of the service rendered by the employees of the Company and the Banks. Your Directors are also grateful to shareholders of the Company and local authorities for their continued valuable support and co-operation to the Company.

For and On behalf of the Board of Directors

Place : Mumbai PRATAP K. MEHTA MUKUND P.MEHTA

Date : 30/08/2012 CHAIRMAN MANAGING DIRECTOR

Mar 31, 2011

Dear Members,

The Directors have pleasure in presenting their 19th Annual Report together with the Audited Statement of Accounts of the Company for the year ended March 31,2011.

FINANCIAL RESULTS:

Amt. in Rs. Lacs 31/03/2011 31/03/2010

Sales and Other income 14626.08 14313.21

Profit before interest, Depreciation & Tax 2239.4 2439.24

Depreciation 558.74 607.26

Interest 372.53 453.47

Profit after Interest & Depreciation 1308.13 1378.51

Provision for Taxes 261.00 275.58

Provision for deferred Tax 1.07 5.59

Net Profit after Taxes 1046.06 1097.34

Prior period interest on Tax - 3.97

Prior period expenses - 46.47

Profit after exceptional items 1046.06 1046.90

Balance brought forward 2588.18 1805.74

Profit available for appropriation 3634.24 2852.64

Balance Transferred to Balance Sheet 3379.95 2588.18

REVIEW OF PERFORMANCE:

During the year under review, Net Profit After Tax was Rs.1046.06 lacs as against Net Profit After Tax of Rs.1097.34 lacs for the corresponding previous year.

Further, Sales and other income grew from Rs. 14313.21 lacs to Rs.14626.08 lacs during the year ended 31st March 2011.

DIVIDEND:

During the year under review, the Board of Directors of the Company is pleased to recommend dividend @ 10% subject to the approval of the Members at their ensuing Annual General Meeting.

DIRECTORS:

During the year under review, Mr. Bhavin Mehta and Mr. Pankaj Kamdar, Directors retire by rotation and being eligible offer themselves for reappointment at the forthcoming Annual General Meeting.

Further, Mr. Nitin Shah resigned as the Whole time Director of the Company w.e.f. 25/07/2011.

Further, it is proposed to reappoint Mr. Mukund Mehta as Managing Director, Mr. Paresh Mehta as Whole time Director designated as Jt. Managing Director and Mrs. Neelima Waingankar as Whole time Director of the Company for a further period of five years from the expiry of their respective dates of previous appointments.

FIXED DEPOSITS:

The Company has not accepted any loans or deposits from public in contravention of Section 58 A of the Companies Act. 1956. and rules framed under the Companies (Acceptance of Deposits) Rules, 1975.

AUDITORS:

M/s RNR Iyer& Co, Chartered Accountants, Auditors of the Company retire at the conclusion of this Annual General Meeting. The members are requested to appoint auditors and to fix their remuneration.

EXPLANATION U/S. 217(3) OF THE COMPANIES ACT, 1956:

Note No. 12 to Significant Accounting Policies:

The said Note is self explanatory and do not call for any further explanation.

STATEMENT U/S. 212 REGARDING SUBSIDIARY COMPANY:

The Statement pursuant to the provisions of Section 212 of the Companies Act, 1956 regarding Subsidiary Company is annexed to this Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE:

Power and Fuel Consumption 2010-11 2009-10

a) Electricity

Purchased Unit (in thousand) 8777.73 7861.48

Total Amount (Rs.in thousand) 42131.13 33,748.59

Rate/ Unit (Rs.)04.80 04.29

b) Own Generator

Fuel (Diesel)

Total Amount (Rs.in thousand) 6307.64 3829.70

Rate per Litre (Rs) 32.85 29.01

Fuel (Furnace Oil)

Total Amount (Rs.in thousand) 16282.74 9917.53

Rate per Litre (Rs) 29.06 27.18

TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION:

During the year under review, the Company has not imported any technology.

FOREIGN EXCHANGE EARNING & OUTGO

Rs. In Lacs

2010-11 2009-10

Earnings 699.05 633.94

Outgoings 1618.61 1103.80

PARTICULARS OF EMPLOYEES:

None of the employees of the company is in receipt of remuneration exceeding Rs.60,00,000/- per annum, if employed for whole of the year or Rs.5,00.000/- per month if employed for part of the year.

INSURANCE:

All properties of the Company including factory, building, plant & machinery. Stock are adequately insured.

FUTURE OUTLOOK:

It is so rightly said "The greatest quality is seeking to serve others".

As stated by our directors, once our hormone and carbapenem facility starts we are sure it will be one of the largest injectable manufacturing units in India. We will be having more products added into the product list facilitating domestic as well as international growth of the company. In the similar wisdom we always endeavor to come up with innovative medicines which assists animal and people live life healthier.

NEW VISION:

Kilitch Drugs (India) Ltd with its exhaustive experience and expertise in manufacturing now opens its wings further and takes up challenges in the sector of marketing.

Eyekare Kilitch Ltd., a subsidiary company launched in the last quarter of the year 2009, has achieved a handsome market share in west and East regions of India. It will be operating Pan India by the end of financial year 2011-12. Our product basket now consist of brands such as OXYEYE, OLOEYE, GATIEYE, MOX1EYE, TOBAEYE, ZETAX- O, WETEYE, WETEYE FORTE, WETEYE UNIMS, MOXIEYE-D, OSMOEYE, CORTEYE, TIMOEYE, OPTRVO, KETOEYE, KETOEYE-O AND PREDEYE covering all therapeutic segments. In coming quarters we are coming up with more segments. Beyond the specifics of a successful enterprise, the story that emerges here is that determination, persistence and a commitment to quality are the crucial ingredients that could work wonders in just about any business.

FOCUS ON GLOBAL BUSINESS:

In the current year we have successfully launched our company's product in the market of BENIN. The business is closely monitored by the Country Manager based in Benin, along with his marketing team works in the promotion of pur branded products. This market is expected to gather momentum and bring good business volume. We have been able to get registration for our products in the markets of West Africa. Also as a part of spreading our business globally we were also successful in getting our products registered in the South East Asian countries like Vietnam, Philippines etc and also have started exporting to these countries. The major achievement in the previous year was the establishment of your company in Ethiopian market.

The company expects to achieve excellent business in these markets.

FOCUS ON HUMAN RESOURCE:

The year 2010-11 has been quite significant for human resource where several initiatives were taken forward. Talent management was taken up as a specific focus area in HR towards integrating employee Development and successful planning.

Employee engagement is one of the key elements in the success of our organization. Your organization has embarked upon a path for building up the same through appreciative enquiry methodology.

CREDIT RATINGS.

Your Company has been accorded A- rating for short term and long term debt by CRISIL. The rating indicates high amount of safety, the prospects of timely reporting of debts/obligations being the best, considering the size of the Company and nature of its business.

MANAGEMENT DISCUSSION AND ANALYSIS:

The Report on management discussion and analysis as required under the Listing Agreement with The Stock Exchanges is enclosed to this Report. Certain statements in this section may be forward looking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of the future performance and outlook

EMPLOYEE STOCK OPTION SCHEME:

During the year under review, employees exercised 29,706 options under Kilitch ESOS 2007. Further options were not granted during the year. Details of the same are given in the annexure to this report.

DIRECTORS' RESPONSIBILITY STATEMENT as required pursuant to inserted Sec. 217(2AA):

i. That in the preparation of annual accounts for the Financial year 2010-11, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. That the directors had selected such accounting policies and applied them consistently and made judgments and estimated that are 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 of the company for that period.

iii. That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. That the directors had prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

The Company continued to believe in and accordingly upgrade itself with concept of Corporate Governance. The company has successfully maintained a code of Corporate Governance in all its concerned operations comprehensively. Corporate Governance and Management Discussion & Analysis Report forms part of this Annual Report. The Company has obtained a Certificate from Practicing Company Secretary for maintenance of Code of Corporate Governance.

LISTING ON NATIONAL STOCK EXCHANGE OF INDIA LIMITED:

Your Directors are pleased to inform you that the Company got listed on National Stock Exchange of India Limited on September 29,2010.

APPRECIATION:

Your Directors place on record their sincere appreciation for the services rendered by the employees of the Company. Further, your Directors are also grateful to the shareholders and Bankers of the Company and authorities at various levels for their continued valuable support and cooperation in the progress of the Company.

For and On behalf of the Board of Directors

PRATAPK.MEHTA MUKIND MEHTA CHAIRMAN MANAGING DIRECTOR

Place: Mumbai Date : 25/07/2011

Mar 31, 2010

The Directors have pleasure in presenting their 18th Annual Report together with the Audited Statement of Accounts of the Company for the year ended March 31. 2010

FINANCIAL RESULTS: Rs. in Lacs

2009-10 2008-09

Sales and Other income 14313.21 12918.07

Profit before interest. Depreciation & Tax 2439.25 2394.40

Depreciation 607.26 613.30

Interest 453.48 510 39

Profit after Interest & Depreciation 1378.51 1270.71

Provision for Taxes 281.17 156 4?

Net Profit after Taxes 1097.35 1114.35

Balance brought forward from previous year 1805.74 955.84

Disposable Profit 2852.65 2070.20

Transfer to General Reserve 110.00 110.00

Proposed Dividend (incl. tax) 154.46 154.46

Balance Transferred to Balance Sheet 2588.19 1805 74

REVIEW OF PERFORMANCE:

During the year under review. Net Profit After Tax was Rs. 1097.35 lacs as against Net Profit After Tax of Rs. 1114.35 lacs for the corresponding previous year.

Further. Sales and other income grew from Rs. 12918.07 lacs to Rs.14313.21 lacs during the year ended 3U March 2010.

DIVIDEND:

During the year under review, the Board of Directors of the Company is pleased to recommend dividend of Rs. 1/- per share subject to the approval of the Members at the Annual General Meeting.

DIRECTORS:

During the year under review, Mr. Mukesh Shah. Mr. Hemang Rngineer and Mr. Shailesh Chheda, Directors retire by rotation and being eligible offer themselves for reappointment at the forthcoming Annual General Meeting.

Further. Mr. Deepak Shenoy resigned as the Director of the Company w.e.f. 26* March 2010. Also Dr Mahalingam Vasudevan resigned as the Director of the Company w.e.f. 10" August 2010.

FIXED DEPOSITS:

The Company has not accepted any loans or deposits from public. There is no contravention of Section 58A of the Companies Act, 1956. and rules framed under the Companies (Acceptance of Deposits) Rules. 1975

AUDITORS:

M/s RR Iyer & Co. (."bartered Accountants. Auditors of the Company retire at the conclusion of this Annual General Meeting. The members are requested to appoint auditors and to fix then remuneration.

EXPLANATION U7S, 217(3) OF THE COMPANIES ACT, 1956:

Note No. 11 to Significant Accounting Policies:

The said Note is self explanatory and do not call for any further explanation

STATEMENT VIS. 212 REGARDING SUBSIDIARY COMPANY:

The Statement pursuant to the provisions of Section 212 of the Companies Act, 1956 regarding Subsidiary Company is annexed to this Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE:

Power and Fuel Consumption 2009-10 2008-09

a) Electricity

Purchased Unit (in thousand) 7861.48 7240.47

Total Amount (Rs. in thousand) 33748.59 29768.70

Rate/ Unit (Rs.) 04.29 4.11

b) Own Generator

Fuel (Diesel)

Total Amount (Rs.in thousand) 3829.70 4488.30

Rate per Litre (Rs) 29.01 52.01 Fuel (Furnace Oil)

Total Amount (Rs.in thousand) 9917.53 11076.40

Rate per Litre (Rs) 27.18 41.23

TECHNOLOGY ABSORPTION, ADO?" HON AND INNOVATION:

During the year under review, the Company has not imported any technology,

FOREIGN EXCHANGE EARNING & OUTGO

Rs. In Lacs

2009-10 2008-09

Earnings 633.94 827.57

Outgoings 1103.80 866.09

PARTICULARS OF EMPLOYEES:

None of the employees of the company is in receipt of remuneration exceeding Rs.24,00,000/- per annum, if employed for whole of the year or Rs.2.00.000- per month if employed for part of the year

INSURANCE:

All properties of the Company including factory, building plant & machinery. Stock are adequately insured.

CREDIT RATINGS:

Your Company has been accoided - rating for short term and long term debt by CRIS1L. The rating indicate:. hlsd amount of safety, the prospects of timely reporting of debts -obligations being I tie best, considering the size of the Company and nature of its h tvness

FUTURE OUTLOOK:

Your Board of Directors are pleased to inform you that the Company has taken further stride for commencement of expansion for HORMONES AND CARBAPENEMS project in the plot adjacent to the existing plot of the Company at Himachal Pradesh.

AWARD AND RECOGNITIONS:

Indian Drugs Manufacturers Association (IDMA) has awarded Gold Quality Award under a category of companies having turnover of Rs.100 crores or more per annum for excellence in quality in production at company green field project of the Company Paonta Sahib Himachal Pradesh,

We have been awarded the Export House status during the year.

We were accredited the ISO 9001:2008, ISO 14001:2004, OHSAS 180012007 Certifications which automatically gave and advantage for our Company in global market.

NEW VISION

In last quarter of the year 2009, Eyekare Kilitch Ltd has been incorporated as subsidiary of the company.

Eyekare Kilitch Ltd. is committed to introduce products which will be used and prescribed by ophthalmologists. Our market research team has carefully selected in consultation with Board of Directors of Eyekare Kilitch Ltd. which includes professionals in the filed, products which are expected to have an excellent scope.

Total opthalmology market has in India is estimated to be around Rs. 650 crores. Although we are targeting a fraction of the market share in the initial year, the company has carefully chosen product mix with innovative marketing initiatives which will enable us to step up the market share significantly in the years to come. The major therapeutic segments of ophthalmology are artificial tears and ocular lubricants, anti-infecfives, anti-glaucoma, corticosteroids, eye tonics and eye vitamins etc. Our product basket covers all this brands such as CORTEYE, GATIEYE, KETOEYE, KETOEYE-O, MOX1EYE. OXYEYE. TIMOEYE, TOBAEYE, TRAVOEYE, WETEYE, WETEYE FORTE. We expect to earn decent margins in this market segment.

FOCUS ON GLOBAL BUSINESS:

In the current year we have added one more feather in our cap by successfully launching companys products in Kenya. A full fledged marketing team has been locally recruited in Kenya and these medical representatives were imparted training by experts from Kilitch. This successful launch is expected to result in good business volume and value in the forthcoming years.

As a part of company policy for geographically spread the business, we have entered West African market which should result in a quantum jump in business volumes.

We have been able to make inroads into the following countries in West African sector viz Benin. Togo, Burkina Faso, Gabon. Mali. Cameroon, Niger, Senegal and Ivory Coast etc. Our wide ranges of products have been registered or under registration in most of these counties and have been able to start the business as well.

FOCIS ON HUMAN RESOURCES

In order to enhance performance of the employees at various levels. training initiatives have been taken for both technical and soft skills.

In the Extra Ordinary General Meeting held in May 2010. stock options granted earlier have been repriced to make the same attractive to employees and to inculcate a sense of ownership in theni-

In the year under review many pharmacy graduates have been inducted to the company to strengthen the organization

MANAGEMENT DISCISSION AND ANALYSIS:

The Report on Management Discussion and Analysis as required under the Listing Agreement with The Stock Exchange is enclosed to this Report. Certain statements in this section may be forward looking. Many factors may affect the actual results, which could be different from what the Directors envisage in terms of the future performance and outlook

EMPLOYEE STOCK OPTION SCHEME:

During the year under review, your Company granted 1.29,100 options to 180 selected employees under Kilitch ESOS 2007. Approval of the shareholders was sought during extra ordinary general meeting and exercise price has been reset at Rs.47.50 per share. Details of the same are given in the annexyre to this Report.

DIRECTORS RESPONSIBILITY STATEMENT as required pursuant to inserted Sec. 217(2AA):

i. that in the preparation of annual accounts for the Financial year 2009-2010, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. that the directors had selected such accounting policies and applied them consistently and made judgments and estimated that are 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 of the company for that period.

iii. that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv. that the directors had prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE:

The Company continues to believe in and accordingly upgrade itself with concept of Corporate Governance. The company has successfully maintained a code of Corporate Governance in ail its concerned operations comprehensively. Corporate Governance and Management Discussion & Analysis Report forms part of this Annual Report. The Company has obtained a Certificate from Practising Company Secretary for maintenance of Code of Corporate Governance.

APPRECIATION:

Your Directors place on record their sincere appreciation of the service rendered by the employees of the Company and the Banks. Your Directors are also grateful to shareholders of the Company and local authorities for their continued valuable support and cooperation to the Company.

For and On behalf of the

Board of Directors

Place: Mumbui PRATAP K. MEHTA

Date: 10th August. 2010 CHAIRMAS

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