Mar 31, 2018
Dear Members,
The Directors take pleasure in presenting the Thirty Second Annual Report along with the audited financial statements for the year ended 31st March 2018.
FINANCIAL HIGHLIGHTS (STANDALONE) Rs. Lakhs
Particulars |
2017-18 |
2016-17 |
Operating Income |
59,236.63 |
53,107.33 |
Othe r Income |
763.44 |
617.68 |
Total Income |
60,000.07 |
53,725.01 |
Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) |
13,644.14 |
13,086.91 |
Profit Before Taxation (PBT) |
8,941.90 |
9,233.61 |
Less: Provision for Taxation |
3,144.16 |
3,236.26 |
Profit After Taxation |
5,797.74 |
5,997.35 |
Add: Other Comprehensive Income |
(3.48) |
(22.56) |
Total Comprehensive Income for the year |
5,794.26 |
5,974.79 |
RESULTS OF OPERATIONS STANDALONE
The income from operations for the financial year 2017-18 was Rs. 59,236.63 Lakhs registering a growth of 11.54% over the previous year income of Rs. 53,107.33 Lakhs. Earnings before interest, tax, depreciation and amortization (EBITDA) were Rs.13,644.14 Lakhs registering a growth of 4.26% over the previous year EBITdA of Rs.13,086.91 Lakhs.
Profit after tax (PAT) for the year was Rs. 5,797.74 Lakhs over the PAT of Rs. 5,997.35 Lakhs in year 2016-17. Reduction in PAT is due to enhanced Depreciation and Amortisation (consequent to re-assessment of useful life of Property, Plant & Equipment) amounting to Rs. 703.91 Lakhs.
SUBSIDIARY COMPANY
Idhayam Hospitals Erode Limited is a wholly owned subsidiary of KMCH Limited. Total Income for the Financial Year 2017-18 was Rs. 35.67 Lakhs an increase of 5.04% over the previous year Total income of Rs. 33.96 Lakhs.
A statement of salient features of financials of Idhayam Hospitals Erode Limited pursuant to Section 129(3) of the Companies Act 2013 in Form AOC 1 is annexed as âAnnexure - Iâ and forming part of the report.
Except the above, the Company has no other Subsidiary, Associate or Joint Venture company. Idhayam Hospitals Erode Limited is not a material subsidiary. The Board of Directors have formulated a policy for determining âmaterialâ subsidiaries pursuant to the provisions of the Listing regulations. The same is displayed on the website of the company (http://kmchhospitals.com/wp-content/uploads/2016/pdf/Policy_on_subsidiaries.pdf).
CONSOLIDATED FINANCIAL STATEMENTS
On consolidated basis, income from operations from current year under review was Rs. 59,236.63 Lakhs, higher by 11.54 % over year 2016-17 income of Rs. 53,107.33 Lakhs.
Profit after tax (PAT) for the year was Rs. 5,797.97 Lakhs over the PAT of Rs. 6,006.35 Lakhs in year 2016-17.
MERGER
The Board at its meeting held on 03rd February 2017 approved the scheme of amalgamation of Idhayam Hospitals Erode Limited (Wholly Owned Subsidiary) with Kovai Medical Center and Hospital Limited effective 1st April 2016.
Pursuant to an Order dated 21st November, 2017 passed by the National Company Law Tribunal, Chennai Bench, separate meetings of Unsecured Creditors and Equity Shareholders of Kovai Medical Center and Hospital Limited was convened and held at the Registered Office of the Company, on 04th January, 2018, approving with or without modification(s), the proposed Scheme of Amalgamation and Arrangement between Idhayam Hospitals Erode Limited and Kovai Medical Center and Hospital Limited under Sections 230 to 232 of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013.
The secured creditors of the Company had provides their no objection to the scheme of amalgamation.
Statutory Clearances from Regional Director, Company Law Board, Department of Income Tax, Government of India are awaited before the Tribunal hears and disposes the Company Petitions confirming the Scheme of Amalgamation.
DIVIDEND
Based on the Companyâs performance, the Directors are pleased to recommend for approval of the members a dividend of Rs. 3.00 per share (30%) for the year 2017-18.
The dividend on equity shares, if approved by the members would involve the cash outflow of Rs. 395.74 Lakhs including dividend distribution tax.
TRANSFER TO RESERVES
The company does not propose to transfer any amount out of the profit to reserves.
BOARD MEETINGS
The Board of Directors met four times during this financial year. The disclosure on Board meetings and attendance of Directors are provided in the Corporate Governance Report.
AUDIT COMMITTEE
The composition of Audit Committee, number of meetings held and the attendance of Directors there to have been provided under an identical head in the Corporate Governance Report.
CORPORATE SOCIAL RESPONSIBILITIES
During the year in pursuance of the recommendations of the CSR Committee the company had contributed Rs.142.42 Lakhs being 2% of the average net profit of the company towards implementing the CSR activities. Annual Report on CSR as required under Section 135 read with schedule VII and other applicable provisions of the Companies Act, 2013 is appended as âAnnexure - IIâ.
INFORMATION ON STATUS OF COMPANYâS AFFAIRS
Information on operational and financial performance etc., is provided in the Management Discussion and Analysis Report, which is annexed to the Directorsâ Report and has been prepared inter-alia in compliance with the terms of SEBI (LODR) Regulations, 2015.
SHARE CAPITAL
The paid up equity share capital of the Company as on March 31, 2018 aggregates to Rs.10,94,22,620/- comprising of 10942262 equity shares of Rs. 10/- each fully paid up.
CREDIT RATING
CARE has affirmed your companyâs Long term bank facilities âCARE A â (single A plus) and short term bank facilities to âCARE A1 â (A One plus) from âCARE A1â ( A One).
HOSPITAL ACCREDITATION
Your Hospital has been certified by National Accreditation Board for Hospitals and Health care providers (NABH) for the delivery of high standards for safety and quality care to the patients.
DIRECTORS RESPONSIBILITY STATEMENT
In pursuance of section 134 (5) of the Companies Act, 2013, the Directors hereby confirm that:
a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) The Directors had selected such accounting policies and applied them consistently and made judgements 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 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;
(d) The Directors had prepared the annual accounts on a going concern basis; and
(e) The Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.
(f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively
BOARD EVALUATION
Pursuant to the provisions of Companies Act, 2013 and SEBI (LODR) Regulations 2015, a structured questionnaire was administered after taking into consideration of various aspects to the Board functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance to ascertain the efficacy and functioning of Board and its members.
The performance evaluation of Independent Directors was completed. The Board of Directors have expressed their satisfaction with the outcome of the evaluation process.
The performance evaluation of the Chairman of the Board and Non-independent Directors was carried out by the Independent Directors. The Independent Directors have expressed their satisfaction with the outcome of the evaluation process.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
Pursuant to requirement of SEBI (LODR) Regulations 2015, the company has a familiarization programme for the Independent Directors with regard to their role, rights, responsibilities in the company, nature of the industry in which the company operates, business model of the company etc. The Board members are provided with all the necessary documents / reports and internal policies to enable them to familiarize with the companyâs procedures and practices and the same is uploaded on the Companyâs website at www.kmchhospitals.com/Familiarization _Programme_for_Independent_Directors.pdf
DIRECTORS
As per Article103(b) of the Articles of Association and Section 152(6) of the Companies Act, 2013, except Dr. Nalla G Palaniswami and Dr. Thavamani Devi Palaniswami, all other Executive and Non-Executive Non-Independent Directors are subject to retirement by rotation. Accordingly, Dr. M.C.Thirumoorthi, Director retires by rotation and being eligible has offered himself for re-appointment.
DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
The Company has received necessary declaration from each Independent Director of the Company under Section149 (7) of the Companies Act, 2013 that the Independent Directors of the Company met with the criteria of their Independence laid down in Section 149(6).
COMPLIANCE OF CODE OF CONDUCT
The compliance of code of conduct by Directors have been affirmed by the Managing Director and is disclosed in the Corporate Governance Report.
KEY MANAGERIAL PERSONNEL
The Key Managerial Personnel of the company as stipulated under the Companies Act 2013 are Dr. Nalla G Palaniswami, Managing Director, Dr.Thavamani Devi Palaniswami, Joint Managing Director, Dr. Mohan S Gounder, Joint Managing Director, Dr. Arun N Palaniswami, Whole Time Director, CA M.K.Ravindra Kumar, Chief Financial Officer and CS S.P.Chittibabu, Company Secretary.
CA P.K.Gopikrishnan, Chief Financial Officer resigned from the services of the Company on 31st May 2017 after 12 years of service. The Board of Directors express their gratitude for the services during his tenure. CA M.K.Ravindra Kumar joined the Company as Chief Financial Officer with effect from 01st June 2017.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
The particulars regarding conservation of energy, technology absorption and foreign exchange earnings and expenditure stipulated under Section 134(3)(m) of the Companies Act 2013 read witht he Companies (Accounts) Rule, 2014, are annexed here with asâAnnexure-IIIâand forms part of this Report.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
During the year, there were no changes in the nature of business of the company or any of its subsidiary.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments affecting 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 date of the report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF COMPANIES ACT 2013
As on March 31, 2018, the Company has neither provided nor there any outstanding loans or guarantees covered under the provisions of Section 186 of the Act. The details of Investments covered under the provisions of Section 186 of the Act are given in Note No.5 to the financial statements.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The company has set up vigil mechanism for Directors and Employees to report their genuine concerns, the details of which are given in the Corporate Governance Report. The policy on Vigil Mechanism and Whistle Blower Policy have been posted on the website of the Company (http://kmchhospitals.com/wp-content/uploads/2016/pdf/Whistle_Blower_Policy.pdf).
RELATED PARTY TRANSACTIONS AND POLICY ON RELATED PARTY TRANSACTIONS
All transactions with Related Parties are at armâs length and in the ordinary course of business duly approved by the Audit Committee of the Board. Hence there are no transactions which are either not in armâs length or which are material in nature requiring disclosure in Form AOC - 2. Hence Form AOC-2 is not annexed to this report.
The Board has formulated Policy on Related Party Transactions and the same is uploaded on the Companyâs website at http://www.kmchhospitals.com/pdf/PolicyRelated Party Transaction.pdf.
RISK MANAGEMENT
The steps taken by the company to mitigate the risk are disclosed under an identical head in the Management Discussion and Analysis forming part of Directorsâ Report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of Annual Return in MGT 9 is annexed herewith as âAnnexure - IVâ and forming part of this report.
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 and the companyâs operations in future.
HUMAN RESOURCE DEVELOPMENT
Your Company continues to place great importance to the development of human resources segment and the sustained focus on retention through employee engagement initiatives has made the employees realize their potential.
Learning and Development has provided various learning platforms which include classroom and online self - learning modules to meet the development need of employees to help build their skills, knowledge and capability.
The total strength of the employees of the Company as on 31st March 2018 was 4051 Nos.
INDUSTRIAL RELATIONS
The industrial relations scenario continued to be cordial during the year under review.
PARTICULARS OF REMUNERATION PAID TO KEY MANAGERIAL PERSONNEL
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 the remuneration of Directors, Key Managerial Personnel and employees are enclosed as âAnnexure - Vâ forming part of the report.
The Nomination and Remuneration Policy of the company has been disclosed on the website of the company and the web link thereon is http://www.kmchhospitals.com/pdf /Nomination.Remuneration Evaluation policy.pdf.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the work place (Prevention, Prohibition and Redressal) Act 2013. An Internal Complaint Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under the policy.
During the year 2017-18, no complaints were received by the company related to sexual harassment.
DEPOSITS
As per Section 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits), Rules 2014, the company has not accepted any deposits from the public during the year.
SECRETARIAL AUDIT
Pursuant to provisions of Section 204 of the Companies Act 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the company has appointed M/s KSR & Co. Company Secretaries LLP, Coimbatore, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the company for the Financial Year 2017-18. Secretarial Audit Report is annexed herewith as âAnnexure -VIâ forming part of the report.
COST AUDIT
In terms of Section 148 and other applicable provisions of the Companies Act 2013, read with Companies (Cost Records and Audit) Rules 2014, Mr.V.Sakthivel, Cost Accountant, M/s RKMS & Associates, Tirupur was appointed as Cost Auditor of the company by the Board on recommendation of Audit Committee for the Financial Year 2018-19. The remuneration of the Cost Auditor is subject to ratification by the members at the ensuing Annual General Meeting.
STATUTORY AUDITORS
M/s. Haribhakti & Co. LLP, Chartered Accountants, (FRN.: 103523W/W100048) were appointed as Statutory Auditors of the Company for five consecutive years at the Annual General Meeting held on 25th September 2015 and the term enures up to the completion of the Audit of the Financial Year 2019-20. However in the context of certain proposed internal restructuring in the Audit Firm, the Company has opted for an early rotation. This was discussed with the Audit Firm and in order to facilitate smooth transition from financial year 2018-19, they have chosen to resign from the position of Statutory Auditors of the Company upon the completion of the audit for the financial year 2017-18 and have conveyed their No-Objection to the Company appointing another Statutory Auditor for the financial year 2018-19 vide their letter dated 11th June 2018.
As per the provisions of Section 139(8) of the Companies Act, 2013, casual vacancy caused by the resignation of auditors can be filled by the Board within 30 days of vacancy and is required to be approved by the Company in general meeting within three months thereof. Hence the Board of Directors at their meeting held on 23rd June 2018 appointed M/s.VKS Aiyer & Co., Chartered Accountants (FRN: 000066S), Coimbatore to fill the casual vacancy and that they will hold office until this Annual General Meeting. The Board proposes that M/s.VKS Aiyer & Co., Chartered Accountants, (FRN: 000066S), may be appointed as the Statutory Auditors of the Company for a period of 5 years in terms of Section 139(1) of the Companies Act, 2013.
M/s. VKS Aiyer & Co., Chartered Accountants, (FRN: 000066S), have conveyed their consent to be appointed as the Statutory Auditors of the Company along with a confirmation that, their appointment, if made by the members, would be within the limits prescribed under the Companies Act, 2013.
Your Board recommends the appointment of M/s VKS Aiyer & Co., Chartered Accountants, (FRN: 000066S) as Statutory Auditors of the Company, to hold office from the conclusion of this Annual General Meeting to the conclusion of the sixth consecutive Annual General Meeting to be held in the year 2023.
LISTING WITH STOCK EXCHANGE
The equity shares of the Company are listed on the Bombay Stock Exchange Limited.
CORPORATE GOVERNANCE
Your Company has been complying with the provisions of Corporate Governance as stipulated in Chapter IV and other relevant provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A separate report on Corporate Governance along with Practising Company Secretaryâs certificate on compliance of the Corporate Governance norms as stipulated in Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Management Discussion & Analysis forming part of this report are provided elsewhere in this Annual Report.
ACKNOWLEDGEMENTS
The Board expresses its grateful appreciation for the continued assistance and co-operation received from Government Authorities, Financial Institutions, Banks, Customers, Suppliers and investors.
The Board also places on record its appreciation for the dedication and commitment extended by its consultants and employees at all levels and their contribution to the growth and progress of the company.
For and on behalf of the Board
Sd/- Sd/-
Place: Coimbatore DR. NALLA G PALANISWAMI CA.A.M.PALANISAMY
Date : 23.06.2018 MANAGING DIRECTOR DIRECTOR
Mar 31, 2017
Dear Members,
The Directors take pleasure in presenting the Thirty First Annual Report along with the audited financial statements for the year ended 31.03.2017.
FINANCIAL HIGHLIGHTS (STANDALONE) (Rs. in lakhs)
2016-17 |
2015-16 |
|
Operating Income |
52562.15 |
46,529.81 |
Other Income |
783.49 |
774.67 |
Total Income |
53,345.64 |
47,304.48 |
Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) |
13,039.94 |
9,945.85 |
Profit Before Taxation (PBT) |
9,203.73 |
6,215.90 |
Provision for Taxation |
3,225.30 |
2,172.55 |
Profit After Taxation (PAT) |
5,978.43 |
4,043.35 |
Balance of Profit brought forward |
12,215.64 |
8,801.53 |
Profit available for appropriations |
18,194.07 |
12,844.88 |
Appropriations |
||
Interim Dividend |
- |
109.42 |
Proposed Dividend - Final |
- |
164.13 |
Tax on Dividend |
- |
55.69 |
Transfer to General Reserve |
- |
300.00 |
Balance carried forward to Balance Sheet |
18,194.07 |
12,215.64 |
RESULTS OF OPERATIONS STANDALONE
The income from operations for the financial year 2016-17 was Rs. 52,562.15 lakhs registering a growth of 12.96% over the previous year income of Rs. 46,529.81 Lakhs. Earnings before interest, tax, depreciation and amortization (EBITDA) were Rs. 13,039.94 lakhs registering a growth of 31.11% over the previous year EBITDA of Rs. 9945.85 Lakhs.
Profit after tax (PAT) for the year was Rs. 5,978.43 lakhs recording a growth of 47.86% over the PAT of Rs. 4043.35 Lakhs in year 2015-16.
SUBSIDIARY COMPANY
Idhayam Hospitals Erode Limited had become a wholly owned subsidiary of KMCH with effect from 23.04.2007.
A statement of salient features of financials of Idhayam Hospitals Erode Limited pursuant to Section129(3) of the Companies Act 2013 in Form AOC 1 is annexed as "Annexure - I" and forming part of the report.
During the financial year ended 31.03.2017, no Subsidiary, Associate or Joint Venture were added. The Board of Directors have formulated a policy for determining ''material'' subsidiaries pursuant to the provisions of the Listing regulations. The same is displayed on the website of the company.
CONSOLIDATED FINANCIAL STATEMENTS
On consolidated basis, income from operations from current year under review was Rs. 52,562.15 Lakhs, higher by 12.96 % over year 2015-16 income of Rs. 46,529.81Lakhs.
Profit after tax (PAT) for the year was Rs. 5,987.42 Lakhs recording a growth of 47.41 % over the PAT of Rs. 4061.74 Lakhs in year 2015-16.
MERGER
The Board at its meeting held on 03.02.2017 approved the scheme of amalgamation of Idhayam Hospitals Erode Limited (Wholly Owned Subsidiary) with Kovai Medical Center and Hospital Limited effective 1st April 2016. The company has filed application seeking the direction of the National Company Law Tribunal inter alia for holding meeting of shareholders for their approval to the scheme of amalgamation. The Company has already obtained no objections to the scheme from its secured creditors.
The Company had filed the scheme with Bombay Stock Exchange Limited as per the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
DIVIDEND
Based on the Company''s performance, the Directors are pleased to recommend for approval of the members a dividend of Rs. 2.50 per share (25 %) for the year 2016-17.
The dividend on equity shares, if approved by the members would involve the cash outflow of Rs. 329.24 Lakhs including dividend distribution tax.
TRANSFER TO RESERVES
The company does not propose to transfer any amount out of the profit to reserves.
BOARD MEETINGS
The Board of Directors met five times during this financial year. The disclosure on Board meetings and attendance of Directors are provided in the Corporate Governance Report.
AUDIT COMMITTEE
The composition of Audit Committee, number of meetings held and the attendance of Directors there to have been provided under an identical head in the Corporate Governance Report.
CORPORATE SOCIAL RESPONSIBILITIES
During the year in pursuance of the recommendations of the CSR Committee the company had contributed Rs. 105.94 Lakhs being 2% of the average net profit of the company towards implementing the CSR activities. Annual Report on CSR as required under Section 135 read with schedule VII and other applicable provisions of the Companies Act, 2013 is appended as â Annexure - II â .
INFORMATION ON STATUS OF COMPANY''S AFFAIRS
Information on operational and financial performance etc., is provided in the Management Discussion and Analysis Report, which is annexed to the Directors'' Report and has been prepared inter-alia in compliance with the terms of SEBI (LODR) Regulations, 2015.
SHARE CAPITAL
The paid up equity share capital of the Company as on March 31, 2017 aggregates to Rs. 10,94,22,620/comprising of 10942262 equity shares of Rs. 10/- each fully paid up.
CREDIT RATING
CARE has upgraded your company''s Long term bank facilities to ''CARE A '' (single A ) from ''CARE A'' and short term bank facilities affirmed ''CARE A1'' ( A One).
HOSPITAL ACCREDITATION
Your Hospital has been certified by National Accreditation Board for Hospitals and Health care providers (NABH) for the delivery of high standards for safety and quality care to the patients.
DIRECTORS RESPONSIBILITY STATEMENT
In pursuance of section 134 (5) of the Companies Act, 2013, the Directors hereby confirm that:
(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) The Directors had 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 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;
(d) The Directors had prepared the annual accounts on a going concern basis; and
(e) The Directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.
(f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively
BOARD EVALUATION
Pursuant to the provisions of Companies Act, 2013 and SEBI (LODR) Regulations 2015, a structured questionnaire was administered after taking into consideration of various aspects to the Board functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance to ascertain the efficacy and functioning of Board and its members.
The performance evaluation of Independent Directors was completed. The performance evaluation of the Chairman of the Board and Non-independent Directors was carried out by the Independent Directors. The Board of Directors expressed their satisfaction with the outcome of the evaluation process.
FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS
Pursuant to requirement of SEBI (LODR) Regulations 2015, the company has a familiarization programme for the Independent Directors with regard to their role, rights, responsibilities in the company, nature of the industry in which the company operates, business model of the company etc. The Board members are provided with all the necessary documents / reports and internal policies to enable them to familiarize with the company''s procedures and practices and the same is uploaded on the Company''s website at www.kmchhospitals.com/Familiarization_Programme_for_Independent_Directors.pdf.
DIRECTORS
As per Article 103(b) of the Articles of Association and Section 152(6) of the Companies Act, 2013, except Dr.Nalla G Palaniswami and Dr.Thavamani Devi Palaniswami, all other Executive and Non-Executive NonIndependent Directors are subject to retirement by rotation. Accordingly, Dr.Purani P Palaniswami, Director retires by rotation and being eligible has offered herself for re-appointment.
DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
The Company has received necessary declaration from each Independent Director of the Company under Section 149 (7) of the Companies Act, 2013 that the Independent Directors of the Company met with the criteria of their Independence laid down in Section 149(6).
COMPLIANCE OF CODE OF CONDUCT
The compliance of code of conduct by Directors have been affirmed by the Managing Director and is disclosed under point no.19 of Corporate Governance Report.
KEY MANAGERIAL PERSONNEL
The Key Managerial Personnel of the company as stipulated under the Companies Act 2013 are Dr.Nalla G Palaniswami, Managing Director, Dr.Thavamani Devi Palaniswami, Joint Managing Director, Dr.Mohan S Gounder, Joint Managing Director, Dr. Arun N Palaniswami, Whole Time Director, CA P.K.Gopikrishnan, Chief Financial Officer and CS S.P.Chittibabu, Company Secretary.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND EXPENDITURE
The particulars regarding conservation of energy, technology absorption and foreign exchange earnings and expenditure stipulated under Section 134(3)(m) of the Companies Act 2013 read with the Companies(Accounts) Rule, 2014, are annexed herewith as "Annexure - IIIâ and forms part of this Report.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
During the year, there were no changes in the nature of business of the company or any of its subsidiary.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments affecting 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 date of the report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
As on March 31, 2017, there were no outstanding loans or guarantees covered under the provisions of Section 186 of the Act. The details of Investments covered under the provisions of Section 186 of the Act are given in Note No.13 to the financial statements.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The company has set up vigil mechanism for Directors and Employees to report their genuine concerns, the details of which are given in the Corporate Governance Report. The policy on Vigil Mechanism and Whistle Blower Policy have been posted on the website of the Company
RELATED PARTY TRANSACTIONS AND POLICY ON RELATED PARTY TRANSACTIONS
All transactions with Related Parties are at arm''s length and in the ordinary course of business duly approved by the Audit Committee of the Board. Hence there are no transactions which are either not in arm''s length or which are material in nature requiring disclosure in Form AOC - 2. Hence Form AOC-2 is not annexed to this report.
The Board has formulated Policy on Related Party Transactions and the same is uploaded on the Company''s website at http://www.kmchhospitals.com/pdf/PolicyRelated Party Transaction.pdf.
RISK MANAGEMENT
The steps taken by the company to mitigate the risk are disclosed under an identical head in the Management Discussion and Analysis forming part of Directors'' Report.
EXTRACT OF ANNUAL RETURN
Pursuant to Section 92(3) of the Companies Act 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of Annual Return in MGT 9 is annexed herewith as "Annexure - IV" and forming part of this report.
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 and the company''s operations in future.
HUMAN RESOURCE DEVELOPMENT
Your Company continues to place great importance to the development of human resources segment and the sustained focus on retention through employee engagement initiatives has made the employees realize their potential.
Learning and Development has provided various learning platforms which include classroom and online self - learning modules to meet the development need of employees to help build their skills, knowledge and capability.
The total strength of the employees of the Company as on 31st March 2017 was 4044 Nos.
INDUSTRIAL RELATIONS
The industrial relations scenario continued to be cordial during the year under review.
PARTICULARS OF REMUNERATION PAID TO KEY MANAGERIAL PERSONNEL
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 the remuneration of Directors, Key Managerial Personnel and employees are enclosed as "Annexure - Vâ forming part of the report.
The Nomination and Remuneration Policy of the company has been disclosed on the website of the company and the web link thereon is http://www.kmchhospitals.com/pdf/Nomination.Remuneration Evaluation policy.pdf.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
The company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the work place (Prevention, Prohibition and Redressal) Act 2013. An Internal Complaint Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under the policy.
During the year 2016-17, no complaints were received by the company related to sexual harassment.
DEPOSITS
As per Section 73 of the Companies Act 2013 read with the Companies (Acceptance of Deposits), Rules 2014, the company has not accepted any deposits from the public during the year.
SECRETARIAL AUDIT
Pursuant to provisions of Section 204 of the Companies Act 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the company has appointed M/s KSR & Co. Company Secretaries LLP, Coimbatore, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the company for the Financial Year 2016-17. Secretarial Audit Report is annexed herewith as "Annexure -VI" forming part of the report.
COST AUDIT
In terms of Section 148 and other applicable provisions of the Companies Act 2013, read with Companies (Cost Records and Audit) Rules 2014, Mr.V.Sakthivel, Cost Accountant, M/s RKMS & Associates, Tirupur was appointed as Cost Auditor of the company by the Board on recommendation of Audit Committee for the Financial Year 2017-18. The remuneration of the Cost Auditor is subject to ratification by the members at the ensuing Annual General Meeting.
STATUTORY AUDITORS
The members had at the 29th Annual General Meeting held on 25.09.2015 approved the appointment of M/s.Haribhakti & Co. LLP., Chartered Accountants as Statutory Auditors for a period of five years from 2015 -16 to 2019-20.
Rule 3 (7) of Companies (Audit and Auditors) Rules 2014, states that appointment of Auditor shall be subject to ratification by the members at every Annual General Meeting till the expiry of the term of appointment of Auditor.
In view of the above, the appointment of M/s.Haribhakti & Co. LLP., Chartered Accountants as Statutory Auditors from the conclusion of this meeting, until the conclusion of the next Annual General Meeting is subject to the members ratification.
LISTING WITH STOCK EXCHANGE
The company confirms that it has paid the Annual Listing Fees for the year 2017-18 to BSE where the company''s shares are listed.
CORPORATE GOVERNANCE
Your Company has been complying with the provisions of Corporate Governance as stipulated in Chapter IV and other relevant provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. A separate report on Corporate Governance along with Practicing Company Secretary''s certificate on compliance of the Corporate Governance norms as stipulated in Regulation 34(3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Management Discussion & Analysis forming part of this report are provided elsewhere in this Annual Report.
ACKNOWLEDGEMENTS
The Board expresses its grateful appreciation for the continued assistance and co-operation received from Government Authorities, Financial Institutions, Banks, Customers, Suppliers and investors.
The Board also places on record its appreciation for the dedication and commitment extended by its consultants and employees at all levels and their contribution to the growth and progress of the company.
For and on behalf of the Board
Place : Coimbatore DR. NALLA G PALANISWAMI
Date : 29.05.2017 MANAGING DIRECTOR
Mar 31, 2015
Dear Members,
The Directors are pleased to present their Twenty Ninth Annual Report
along with the audited annual accounts for the financial year ended
31stMarch, 2015.
(Rs.in Lacs)
FINANCIAL RESULTS (STANDALONE) 2014-15 2013-14
Operating Income 40162.07 33406.05
Other Income 672.73 469.70
Total Income 40834.80 33875.75
Earnings Before Interest,
Tax, Depreciation and
Amortization (EBITDA) 10100.38 7755.70
Profit Before Taxation (PBT) 5942.77 3731.94
Provision for Taxation 2072.87 1360.04
Profit After Taxation (PAT) 3869.90 2371.90
Balance of Profit brought forward 5384.95 3355.07
Profit available for appropriations 9254.85 5726.97
Appropriations:
Adjustments related to fixed assets
(Net of Deferred Tax) 55.78 -
Dividend (inclusive of dividend tax) 197.54 192.02
Transfer to General Reserve 200.00 150.00
Balance carried forward to
Balance sheet 8801.53 5384.95
RESULTS OF OPERATIONS
The Income increased to Rs. 40834.80 lacs from Rs. 33875.75 lacs in the
previous year at a growth rate of 21%. The EBITDA amounted to Rs.
10100.38 lacs as against Rs. 7755.70 lacs in the previous year. The
Hospital earned a net profit of Rs. 3869.90 lacs for the year as against
Rs. 2371.90 lacs in the previous year registering year on year (YOY)
growth of 63%.
The consolidated Income increased to Rs. 40821.78 lacs compared to Rs.
33857.29 lacs in the previous year, registering a growth of 21%.
Consolidated net profit after tax increased to Rs. 3853.36 lacs
representing a growth of 62%.
CONSOLIDATED FINANCIAL STATEMENTS
The Directors also present the audited consolidated financial
statements incorporating the duly audited financial statements of the
subsidiary and as prepared in compliance with the Companies Act, 2013,
applicable Accounting Standards and the Listing Agreement as prescribed
by SEBI.
DIVIDEND
After considering the Company's profitability, Cash flow and overall
financial performance, your Directors are pleased to recommend dividend
of 15% (Rs.1.50 per share) for the financial year ended 31.03.2015.
The total out flow on account of dividend, if approved by the Members,
will be about Rs.197.54 lacs including Rs.33.41 lacs payable towards
dividend tax, surcharge and cess on the same.
TRANSFER TO RESERVES
The Company proposes to transfer Rs. 200 lacs to the General reserve out
of the amount available for appropriation and an amount of Rs. 3416.58
lacs is proposed to be retained in the Statement of profit and loss.
BOARD MEETINGS
The Board of Directors met four times during this financial year. The
disclosure on Board meetings and attendance of Directors are provided in
the Corporate Governance Report.
AUDIT COMMITTEE
The composition of Audit Committee, number of meetings held and the
attendance of Directors there to have been provided under an identical
head in the Corporate Governance Report.
CORPORATE SOCIALRES PONSIBILITIES
The Boardon23.05.2014 constituted the CSR Committee and formulated CSR
policy of the company and adopted it in accordance with Section 135 read
with Schedule VII and other applicable provisions of the Companies Act,
2013. The purpose of the Committee is to formulate and manage the CSR
policy of the company. The Committee will be overseeing the CSR
activities, programmes and execution of initiatives as per guidelines.
The company has initiated CSR activities in line with, CSR policy and
have already earmarked to spend an amount of Rs. 57 lacs towards CSR
expenditure. The statement in this respect is appended as "Annexure-I"
inthe report with regard to the CSR activities.
INFORMATION ON STATUS OF COMPANY'SAFFAIRS
Information on operational and financial performance etc., is provided
in the Management Discussion and Analysis Report, which is annexed to
the Directors' Report and has been prepared interÂalia in compliance
with the terms of clause 49oflisting agreement with Indian Stock
Exchanges.
INFECTION CONTROLANDENVIRONMENT
Infection Control is the discipline concerned with preventing
No socomial or health care associated infection. One of our key clinical
priorities is to protect our patients, visitors and staff from the risk
of health care associated infections. Various infection control
procedures like effective management of Bio-Medical waste, good hand
hygiene, environmental cleaning, antibiotic control and excellent
intravenous line care have helped us to effectively tackle the
incidence of infections in our hospital.
LIVERTRANS PLANT
Your hospital has successfully launched its Liver Institute during
July, 2014 which offers comprehensive, multi-disciplinary disease
management, specializing in Liver disease, Liver transplants. It also
envisages treating ailments relating to bile ducts and pancreas in the
future. So far we have successfully completed 35 liver transplants.
CREDITRATING
CARE has once again upgraded your Company's Long term bank facilities
to "CARE A-" (single A minus) from "CAREBBB " and short-term bank
facilities to" CAREA2" (A Two) from" CAREA3 ".
AWARDS
Your Hospital was awarded "Nursing Excellence Award" by the Association
of Healthcare Providers of India and also was recognized by ICICI
Lombard Health Insurance & CNBC TV18 as "The Best Multi-Specialty
Hospital" in non-metro city for the second time.
HOSPITALACCREDITATION
Your Hospital has been certified by National Accreditation Board for
Hospitals and Health care Providers (NABH) for the delivery of high
standards for safety and quality caret the patients.
DIRECTORS RESPONSIBILITY STATEMENT
In pursuance of section 134 (5) of the Companies Act, 2013, the
Directors hereby confirm that:
(a) In the preparation of the annual accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures;
(b) The Directors had 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 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;
(d) The Directors had prepared the annual account son going concern
basis;
(e) The Directors, had laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively; and
(f) The Directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
BOARDEVALUATION
Pursuant to the provisions of Companies Act, 2013 and Clause 49 of the
listing agreement, a structured questionnaire was administrated after
taking into consideration of various aspects to the Board functioning,
composition of the Board and its Committees, culture, execution and
performance of specific duties, obligations and governancetoascertain
the efficacy and functioning of Board and its members.
The performance evaluation of Independent Directors was completed. The
performance evaluation of the Chairmanofthe Board and Non-Independent
Directors was carried out bythe Independent Directors. The Board
ofDirectors expressed their satisfaction with the outcomeof the
evaluation process.
FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS
Pursuant to requirement of Clause 49 of the Listing Agreement, Company
has a familiarization programme for the Independent Directors with
regard to their role, rights, responsibilities in the Company, nature
of the industry in which the Company operates, business model of the
Company etc. The Board Members are provided with all the necessary
documents / reports and internal policies to enable them to familiarize
with the Company's procedures and practices.
DIRECTORS
Dr.P.R.Perumalswami, Director retires at the ensuing AGM andis not
opting for re-appointment.
Your Directors place on record the valuable guidance, support and
advice extended by Dr.P.R.Perumalswami during his tenure as Director.
As per the provisions of Section 152(6)(e) of the Companies Act, 2013
at the Annual General Meeting at which a Director retires, the Company
may fill up the vacancy by appointing the retiring Director or some
other person thereto.
The Company has received a notice in writing from a member along with a
deposit of requisite amount under Section 160 of the Companies Act,
2013 proposing the candidature of Dr.Arun N Palaniswami for the
officeof Director of the Company.
The Board at its meeting held on 29.05.2015 recommended the appointment
of Dr. Arun N Palaniswami as Whole Time Director with effect from
25.09.2015 subject to the approval of members. Hence, necessary
resolution is placed for approval.
APPOINTMENT OF JOINT MANAGING DIRECTOR
The term of office of Dr.Thavamani DeviPalaniswami, Joint Managing
Director of the Company expires on 28th July 2015. The terms and
conditions of her re-appointment for a further period of 5 years and
payment of remuneration are subject to the approval of the members of the
company at the ensuing Annual General Meeting by means of a special
resolution.
DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS
The Company has received necessary declaration from each Independent
Director of the Company under Section 149(7) of the Companies Act, 2013
that the Independent Directors of the Company met with the criteria of
their Independence laid down in Section 149(6).
COMPLIANCEOFCODEOFCONDUCT
The compliance of code of conduct by Directors have been affirmed by
the Managing Director and is disclosed under point no.20 of Corporate
Governance Report.
KEYMANAGERIALPERSONNEL
The Key Managerial Personnel of the Company as stipulated under the
Companies Act, 2013 are Dr.Nalla G Palaniswami, Managing
Director,Dr.Thavamani DeviPalaniswami, Joint Managing Director, Dr.Mohan
S Gounder, Joint Managing Director, CA.P.K.Gopikrishnan, Chief
Financial Officer and CS.S.P.Chittibabu, Company Secretary. There was
no appointment or cessation of Key Managerial personnel during the
financial year 2014-15.
PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND
FOREIGN EXCHANGE EARINGS AND EXPENDITURE
The particulars regarding conservation of energy, technology absorption
and foreign exchange earnings and expenditure stipulated under section
134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts)
Rule, 2014, are annexed herewith as "Annexure-IV"and forms part of this
Report.
SUBSIDIARYCOMPANY
Idhayam Hospitals Erode Limited had become a wholly owned subsidiary of
the company with effect from 23.04.2007.
The consolidated financial statement of the company including the
financial results of the said subsidiary is also included in this
report. A statement of salient features of financials of Idhayam
Hospitals Erode Limited pursuant to Section 129(3) of the Companies
Act, 2013 in Form AOC-1 is annexed and forming part of the report.
CHANGE IN THE NATURE OF BUSINESS,IF ANY
During the year, there wasno change in the nature of business of the
Company or any of its subsidiaries.
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF
THE COMPANY
There were no material changes and commitments affecting 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 date of the report.
PARTICULARS OF LOANS,GUARANTEES OR INVESTMENTS UNDER SECTION 186
As on March 31, 2015, there were no outstanding loans or guarantees
covered under the provisions of Section 186 of the Act. The Company has
certain quoted and unquoted investments owned by the Company. The
details of changes in Investments covered under the provisions of
Section 186 of the Act are given in the Note No.13 to the financial
statements.
VIGIL MECHANISM
The company has set up vigil mechanism for Directors and Employees to
report their genuine concerns, the details of which are given in the
Corporate Governance Report. The policy on Vigil Mechanism and Whistle
Blower Policy have been posted on the website of the Company
http://www.kmchhospitals.com/pdf/whistleblower.policy.pdf.
EXTRACT OF ANNUAL RETURN:
As required pursuant to section 92(3) of the Companies Act, 2013 and
rule 12(1) of the Companies (Management and Administration) Rules,
2014, an extract of annual return in MGT9 is annexed herewith as
"Annexure-V" and forming part of report.
RISK MANAGEMENT
Pursuant to the requirement of Clause 49 of the Listing Agreement, the
Company has constituted a Business Risk Management Committee. The
details of the Committee and its terms of reference are set out in the
Corporate Governance Report. The steps taken by company to mitigate the
risk are disclosed under an identical head in the Management Discussion
and Analysis forming part of Directors' Report.
RELATED PARTY TRANSACTIONS AND POLICY ON RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the
financial year were on an arm's length basis and were in the ordinary
course of business. There are no materially significant related party
transactions made by the Company which may have a potential conflict
with the interest of the Company at large and particulars of
Contracts or Arrangements with Related parties referred to in Section
188(1)in FormAOC-2 is annexed as "Annexure - III" and forming part of
the report.
The Board has formulated Policy on Related Party Transactions and the
same is uploaded on the Company's website at
http://www.kmchhospitals.com/pdf/Policy Related Party Transaction.pdf.
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 and the
Company's operations in future.
HUMAN RESOURCES DEVELOPMENT
KMCH lays paramount importance to human resources development and
provides congenial atmosphere and frame work for helping employees to
develop their personal and organizational skills, knowledge and
abilities. Your Hospital believes in developing the most superior
workforce so that organization and individual employees can accomplish
their work goals by providing improved service to the patients. The
total strength of the employees of the company as on 31st March 2015
was 3387.
INDUSTRIAL RELATIONS
The industrial relations scenario continued to be cordial during the
year under review.
PARTICULARS OF REMUNERATION PAID TO KEY MANAGERIAL PERSONNEL
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 the remuneration of Directors, Key Managerial
Personnel and employees are enclosed as"Annexure - VI" forming part of
the report.
The Nomination and Remuneration Policy of the Company has been
disclosed on website of the Company and the web link thereon is
http://www.kmchhospitals.com/pdf/Nomination.Remuneration Evaluation
Policy.pdf.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL ACT, 2013.
The Company has in place a Prevention of Sexual Harassment policy in
line with the requirements of the Sexual Harassment of Women at the
Workplace (Prevention, Prohibition and Redressal) Act, 2013. An
Internal complaint committee has been setup to redress complaints
received regarding sexual harassment. All employees (permanent,
contractual, temporary, trainees) are covered under the policy.
During the year 2014-15, no complaints were received by the Company
related to sexual harassment.
DEPOSITS
As per Section 73 of the Companies Act, 2013 read with the Companies
(Acceptance of Deposits), Rules, 2014, the Company has not accepted any
deposits from the public during the year.
SECRETARIAL AUDIT
Pursuant to provisions of Section 204 of the Companies Act, 2013 and
the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, the Company has appointed M/s KSR & Co. Company
Secretaries LLP, Coimbatore, a firm of Company Secretaries in Practice
to undertake the Secretarial Audit of the Company for the financial
year 2014-15. Secretarial Audit Report is annexed herewith as "Annexure
- II" forming part of the report.
COSTAUDIT
In terms of Section 148 and other applicable provisions of the
Companies Act, 2013, read with Companies (Cost records and Audit) Rules
2014, Mr.V.Sakthivel, Cost Accountant, M/s.RKMS & Associates, Tirupur
was appointed as Cost Auditor of the Company by the Board on
recommendation of Audit Committee for the financial year 2014-15 and
2015-16. The Remuneration of the cost auditor is subject to
ratification by the member at the ensuing Annual General Meeting.
STATUTORYAUDITORS
M/s Haribhakti & Co. LLP, Statutory Auditors of the Company retire at
the conclusion of the ensuing Annual General Meeting. M/s. Haribhakti &
Co. LLP are eligible for re-appointment and have confirmed that their
re-appointment, if approved, will be in compliance with Section 141 of
the Companies Act, 2013 for a fresh term of 5 years.
As per Section 139 of the Companies Act, 2013, a Listed Company shall
not appoint / re-appoint an Audit firm as Statutory Auditors for more
than 2 terms of Five consecutive years. M/s.Haribhakti & Co. LLP have
already served as the Company's Statutory Auditor's for a period of 5
years, from 2010-11. They are eligible for re-appointment as Statutory
Auditors of the Company for a further period of five years.
Your Board recommends the re-appointment of M/s.Haribhakti & Co. LLP as
Statutory Auditor's of the Company, to hold office from the conclusion
of this AGM to the conclusion of the sixth consecutive AGM to be held
in the year 2020 (Subject to ratification of the appointment by the
members at every AGM held after the ensuing AGM).
LISTING WITH STOCK EXCHANGE:
The Company confirms that it has paid the Annual Listing Fees for the
year 2015-16 to BSE where the Company's Shares are listed. During the
year the company has submitted an application with Madras Stock
Exchange Limited for voluntary delisting of its shares and MSE has
delisted the shares of the Company from its list of securities.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the listing agreement a report on corporate
governance is given in the section titled "Report on Corporate
Governance" forming part of Directors' Report.
A Certificate from the Practising Company Secretary confirming that the
compliance with the conditions of Corporate Governance as stipulated
under Clause49 of the Listing Agreement is attached to this report.
ACKNOWLEDGEMENTS
Your Hospital is entering into the 25th year of commercial operations
and continues to serve its patients with motherly care by matching the
international standards in health care. The Board has decided to
celebrate the Silver Jubilee function during the year 2015-16 and would
like to place on record it's heartfelt thanks for the continued support
received from all stakeholders especially from our shareholders, who
have contributed richly to the success of the Hospital.
The Board expresses its grateful appreciation for the continued
assistance and co-operation received from Government authorities,
financial institutions, Banks, Customers, Suppliers and investors.
The Board also places on record its appreciation for the dedication and
commitment extended by its consultants and employees at all levels and
their contribution to the growth and progress of the company.
For and on behalf of the Board
Coimbatore Dr. NALLA G PALANISWAMI
29.05.2015 MANAGING DIRECTOR
Mar 31, 2014
The Directors take pleasure in presenting the Twenty Eighth Annual
Report of your company together with Audited Financial Statements for
the year ended 31st March 2014.
FINANCIAL RESULTS (STANDALONE)
(Rs.in lacs)
2013-14 2012-13
Operating Income 33414.28 29713.38
Other Income 461.47 305.51
Total Income 33875.75 30018.89
Earnings Before Interest, Tax &
Depreciation (EBITDA) 7755.70 7330.24
Profit Before Taxation (PBT) 3731.94 3133.27
Provision for Taxation 1360.04 1008.50
Profit After Taxation (PAT) 2371.90 2124.77
Balance of Profit brought forward 3355.07 1572.32
Profit available for appropriations 5726.97 3697.09
Appropriations:
Dividend (inclusive of dividend tax) 192.02 192.02
Transfer to General Reserve 150.00 150.00
Balance carried forward to Balance Sheet 5384.95 3355.07
RESULTSOFOPERATIONS
During the year under review, the income from operations of the company
increased to Rs. 33414.28 lacs compared to Rs. 29713.38 lacs in the
previous year, registering a growth of 12.46 percent. Factors like poor
macro-economic environment, rising interest rates, failure of monsoon,
heavy power shut down all have dampened the industrial activities,
causing contraction of liquidity in the economy, which had impacted the
current performance of your Hospital resulting in decline in the growth
of revenue, when compared to the previous year.
The profit after tax for the year increased to Rs. 2371.90 lacs against
the year ago profit of Rs. 2124.77 lacs. The company was able to achieve
an operational profit of Rs. 7755.70 lacs (Rs. 7330.24 lacs in 2012-13) in
spite of the increase inall input costs.
DIVIDEND
The Board of Directors at their meeting held on 23.05.2014 recommended
a dividend of 15 percent ( Rs. 1.50 per share) for the Financial Year
ended 31.03.2014 absorbing a sum of Rs. 192.02 lacs including tax
payablebythe company.
TRANSFERTORESERVES
The company proposes to transfer Rs. 150 lacs to the general reserve out
of the amount available for appropriation and the balance amount of
profit for the year of Rs. 2029.88 lacs is proposed to be retained in the
Statementof Profit and Loss.
CORPORATESOCIALRESPONSIBILITIES
The company firmly believes in providing high quality health care
facility on a continuous basis with a human touch. The Hospital in its
endeavour to extend health care facilities, cater not only to poor
patients but also reaches out to the society at large. We have been
organizing various continuous medical education programmes (CME),
medical camps which provide free medical care besides health awareness
and education. During the year free consultation camps on Cardiology,
Orthopaedics, Gastro- enterology, Dental, General Medicine, Spine,
Oncology, Diabetics, Multi-speciality and free General Medical
campswereconducted.
INFECTIONCONTROLANDENVIRONMENT
The infection control programme organized by your Hospital has yielded
effective control over infection related diseases. The infection
control committee actively monitors and reviews every month the
incidences and take corrective steps to prevent such occurrences.
Patient, Employee safety and precaution against occupational hazards
were very effective and have considerably reduced the infection related
issues.
TECHNOLOGYABSORPTION
The Hospital always believes in giving the best to the patients and in
this regard it continuously invests in cutting edge technology and in
the latest and best equipments. During the year, your Hospital added
Haemo Dialysis Machines, Ultrasonic Surgical Aspirator, Refrigerated
Centrifuge, Mobile X-ray, PHACO Machine, Haemonetics Coagulation
Analyser, Arthroscopic Camera Unit, Colour Doppler and other equipments
to the tune of Rs. 372 lacs.
CONSERVATIONOFENERGY
Your company has taken numerous steps for conserving energy and has
installed building management system (BMS) for continuous monitoring of
the power consumption. The power generation and consumption is
continuously and closely monitoredto conserve energy.
The company has invested continuously insolar water heaters and power
lights.
Close monitoring of power generation, its usage and periodical
maintenance of the plants have helped the companytoconserveenergy.
CREDITRATING
CARE has upgraded our company''s debt instruments to ''CARE BBB '' from
Rs.CARE BBB'' for its long term facilities and the company continue to
have the credit ratingas''CARE A3 '' for its short term facilities.
AWARDS
Your Hospital has been rated as ''No.1 Best Multi-speciality Hospital in
Coimbatore'' by a survey conductedby"TheWeek magazineinits November
2013publication.
HOSPITALACCREDITATION
Your Hospital has been certified by National Accreditation Board for
Hospitals and Health care Providers (NABH) for the delivery of high
standards of safety and quality care to the patients.
HUMANRESOURCESDEVELOPMENT
KMCH recognizes the value of its human resources. We strive hard to
provide employee friendly environment in our hospital in developing
highly motivated and satisfied work force. We encourage and nurture
creativity, innovation and motivate employees for improved performance.
The total number of employees increased from2236asonMarch 31, 2013 to
2924asonMarch31, 2014.
INDUSTRIALRELATIONS
The industrial relations scenario continuedto be cordial during the
year under review.
DIRECTORSRESPONSIBILITYSTATEMENT
Pursuant to Section 217(2AA) of the Companies (Amendment) Act, 2000,
the Directors of the Company hereby state and confirm that:
In the preparation of the annual accounts for the year, the applicable
accounting standard had been followed along with proper explanations
and there wereno material departures;
The Directors had selected such accounting policies and applied them
consistently and made judgements 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 endofthe financial year andofthe profit of the
company for that period;
The Directors had taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities;
The Directors hadpreparedthe annual accountsonagoing concernbasis.
DIRECTORS
As per the provisions of Sections 149, 150, 152 and other applicable
provisions of the Companies Act, 2013 and the rules made thereunder
read with Schedule IV of the Companies Act, 2013, Mr.Kasi K Goundan
(DIN:01145935), Dr.M.Manickam (DIN:00102233), CA. A.M.Palanisamy
(DIN:00112303), Mr.A.K.Venkatasamy (DIN:00036191), Mr.K.Saminathan
(DIN:01571748), Dr.M.A.Muthusethupathi (DIN:02766069) all existing
Independent Directors will be appointed as Independent Directors of the
company and shall hold office from the date of Annual General Meeting
for a period offive years upto 02.09.2019.
The company has received declaration from all the Independent Directors
of the company confirming that they meet with the criteria of
independence as prescribed both under sub-section (6) of Section 149 of
the Companies Act, 2013andunder clause49ofthe listing agreement with
theStock Exchanges.
They shall not, henceforthbe liable toretirementbyrotation.
Dr.M.C.Thirumoorthi, Director retires by rotation and being eligible
has offered himself for re-appointment.
APPOINTMENTOFMANAGINGDIRECTOR
The term of office of Dr.Nalla G Palaniswami, Managing Director of the
Company expires on 30th September 2014. The terms and conditions of his
re-appointment for a further period of 5 years and payment of
remuneration are subject to the approval of the members of the company
at the ensuing Annual General Meeting.
SUBSIDIARYCOMPANY
Idhayam Hospitals Erode Limited had become a wholly owned subsidiary of
KMCH with effect from 23.04.2007. The Ministry of Corporate Affairs
(MCA) vide its circular No.5/12/2007-CL-III dated 8th February 2011 had
granted general exemption under Section 212(8) of the Companies Act,
1956 to companies from attaching the accounts of their subsidiaries in
their annual reports subject to fulfillment of certain conditions
prescribed.
The Board of Directors of the Company at its meeting held on May 23,
2014 noted the provisions of the circular of the MCA and passed
necessary resolution granting the requisite approvals for not attaching
the Balance Sheet, Statement of Profit and Loss, Report of the Board of
Directors and Report of the Auditor of Idhayam Hospitals Erode Limited
to the accounts of the company. A statement of summarized financials of
Idhayam Hospitals Erode Limited pursuant to Section 212(8) of the
Companies Act, 1956 forms part of this report.
However the Company will provide the annual report and the financial
statements of its Subsidiary Company on the specific request made by
any investor and the said accounts are open for inspection at the
Registered Office of the Company during office hours on all working
days between 2.00 p.m. to 4.00 p.m. (except Sundays and holidays).
CONSOLIDATEDFINANCIALSTATEMENTS
As required under Clause 32 of the listing agreement with the Stock
Exchanges and in accordance with the requirements of Accounting
Standard AS-21 of the Companies (Accounting Standard) Rules, 2006. The
Consolidated Financial Statements presented by your company includes
the financial information of its subsidiary also.
PARTICULARSOFEMPLOYEES
The statement containing particulars of the employees as required under
Section 217(2A) of the Companies Act, 1956 read with Companies
(Particulars of Employees) Rules, 1975, as amended, forms part of this
Report. However, in terms of Section 219(1)(b)(iv) of the Companies
Act, 1956, the annual report excluding the aforesaid information is
being sent to all the members. Such particulars may be
obtainedbyanymember,bywritingtothe Company Secretaryatthe
RegisteredOfficeofthe Company.
ENERGYCONSERVATION,TECHNOLOGYABSORPTIONANDFOREIGNEXCHANGE
Particulars required under Section 217(1)(e) of the Companies Act,
1956, read with the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988 regarding conservation of
energy, technology absorption has been dealt in our Directors'' Report.
The particulars regarding foreign exchange inflow and outgo
appearasnote no.32 forming partof the accounts.
FIXEDDEPOSITS
As per Section 58A of the Companies Act, 1956, the Company has not
accepted any deposits from the public during the year.
AUDITORS
The Auditors M/s Haribhakti & Co., Chartered Accountants, Coimbatore
retires at the ensuing Annual General Meeting and are eligible for
re-appointment in accordance with the provisions of Section 139(1)
andSection 141oftheCompanies Act,2013.
CORPORATEGOVERNANCE
Pursuant to Clause 49 of the listing agreement a report on corporate
governance is given in the section titled "Reporton Corporate
Governance forms part of the Directors'' Report inthe Annual Report.
A certificate from the practising company secretary regarding
compliance of the conditions of corporate governance as stipulated
under Clause 49 of the Listing Agreement entered into with the Stock
Exchanges isattached to this report.
ACKNOWLEDGEMENTS
Your Directors place on record their appreciation for the continued
support to the company extended by bankers, Govt. authorities,
customers, vendors, investors, members, consultants and employees.
For and on behalf of the Board
Coimbatore DR. NALLA G PALANISWAMI
23.05.2014 CHAIRMAN AND MANAGING DIRECTOR
Mar 31, 2013
Dear Members,
The Directors have pleasure in presenting the Twenty Seventh Annual
Report of your company together with Audited Financial Statements for
the year ended 31st March 2013.
FINANCIAL RESULTS (STANDALONE)
{Rs.in lacs)
2012-13 2011-12
Operating Income 29713.38 22237.24
Other Income 305.51 156.15
Total Income 30018.89 22393.39
Earnings Before Interest,
Tax & Depreciation (EBITDA) 7330.24 4494.51
Profit Before Taxation (PBT) 3133.27 1624.09
Provision for Taxation 1008.50 429.19
Profit After Taxation (PAT) 2124.77 1194.90
Balance of Profit
brought forward 1572.32 636.39
Profit available
for appropriations 3697.09 1831.29
Appropriations:
Dividend (inclusive of
dividend tax) 192.02 158.97
Transfer to General Reserve 150.00 100.00
Balance carried forward to
Balance Sheet 3355.07 1572.32
REVIEW OF OPERATIONS
With the sound performance in all its activities, your Company could
cross a mile stone of achieving more than Rs. 300 crores revenue during
the Financial Year under review, at a growth of 34% over the previous
year revenue of Rs. 223.93 crores registering an enhanced profitability
with EBITDA for the current year at Rs. 73.30 crores from Rs. 44.95 crores
in the previous year, an increase of 63%. Profit after tax increased to
Rs. 21.25 crores in the current year from Rs.11.95 crores of the previous
the year.
The finance cost has increased to Rs. 21.46 crores during 2013 compared
to Rs. 16.57 crores during 2012. The increase was largely due to higher
interest charge arising out of commissioning of new projects at Main
Center at Coimbatore and also due to the general increase in interest
rates during this year.
Erode Center and Erode Speciality Center also contributed to the growth
of your company. During the year under review, Erode Center posted a
revenue of Rs. 12.74 crores against Rs. 10.79 crores in the previous year.
The operating profit for the current year is Rs. 2.93 crores against
previous year figure of Rs. 2.22 crores showing a growth of 32%. Erode
Speciality Center revenue grew by 32% to Rs. 17.49 crores compared to Rs.
13.20 crores in the previous year. Similarly the operating profit for
the current year is Rs. 1.99 crores against previous year figure ofRs.
1.04 crores registering a growth of 92%.
DIVIDEND
In view of the improved performance, the Board of Directors at their
meeting held on 18.05.2013 recommended a dividend of 15% (Rs. 1.50 per
share) for the Financial Year ended 31.03.2013 absorbing a sum of
Rs.1.92 crores including taRs. payable by the company.
TRANSFER TO RESERVES
The company proposes to transfer Rs. 1.50 crores to the general reserve
out of the amount available for appropriation and an amount of Rs. 17.83
crores is proposed to be retained in the Statement of Profit and Loss.
CORPORATE SOCIAL RESPONSIBILITIES
The company always places greater importance to manage its affairs with
highest levels of transparency, accountability and integrity and is
committed to achieve and maintain the high standards of corporate
governance on sustained basis.
Your Hospital is committed to the welfare of not only poor patients but
also to the society at large. The Hospital has been regularly
organizing various continuous medical education programmes, medical
camps which provides, not only free medical care, but also promote
health awareness and education to general public. During the year, free
consultation camps were conducted for various medical specialities,
like Cardiac Screening, Blood Screening, General Medicine, Occupational
Therapy, Spine, Head & Neck, Gynaecology etc.
INFECTION CONTROLAND ENVIRONMENT
Your Hospital continues to lay greater emphasis on hospital infection
control practices. We have established an Infection Control Committee
for updating the implemented policies and procedures, which are
actively monitored by the Infection Control Team to control the
hospital acquired infections. Moreover, all the Hospital staff are
being vaccinated for various communicable diseases. These measures have
yielded results and are reflected in the reduction of healthcare
associated infections.
TECHNOLOGY ABSORPTION
In its continuous endeavour to serve the patients in the best way
possible, your Hospital continues to invest in the latest and the best
that the world has to offer in terms of technology and sophistication.
During the year, your Hospital added a Colour Doppler Ultrasound
Scanner system Model VIVID S5, E9 and Voluson S6, a High Definition
Laparoscopy System, a High Speed Neuro Drill System and other
equipments to the tune of Rs. 2.90 crores.
CONSERVATION OF ENERGY
Considering the current energy scenario in India, especially in Tamil
Nadu, your Hospital gives greater importance to conserve energy and has
initiated the following measures.
Building Management System (BMS) has been installed for airconditioning
and higher energy consumption equipment areas.
By using different capacity chillers for peak and non-peak hours, the
hospital is able to save the cost of 1000 units of power per day
(approRs.. Rs. 10,000/-).
Old Air Handling Units were replaced by new energy efficient plug fan
type Air Handling Units.
Hot water supply for patient rooms are provided with solar power.
Wherever possible we have installed solar power lights and water
heaters.
Energy generation and its consumption are continuously monitored and
periodical maintenance of the plants helps us to conserve energy.
CREDIT RATING
CARE has rated company''s debt instruments as ''CARE BBB'' for long term
facilities of safety and upgraded short term facilities to ''CARE A3 ''
from CARE A3''. Both this grades indicates instruments with moderate
degree of safety.
AWARDS
Your Hospital has been conferred the "Best Multispeciality Hospital
Award" in the Non Metro South India category at the recent India
Healthcare Awards at Delhi by ICICI Lombard Health Insurance & CNBCTV
18
Your Hospital has been awarded "Management System Certificate" by DET
NORSKE VERITAS, United Kingdom. This confirms that the Hospital
Information Security Management Systems follows standard ISO/IEC
27001:2005.
HOSPITAL ACCREDITATION
Your Hospital has been certified by National Accreditation Board for
Hospitals and Healthcare Providers (NABH) for the delivery of high
standards of patient safety and quality of care to the patients.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies (Amendment) Act, 2000,
the Directors of the Company hereby state and confirm that:
In the preparation of the annual accounts for the year, the applicable
accounting standards had been followed along with proper eRs.planations
and there were no material departures;
The Directors had selected such accounting policies and applied them
consistently and made judgements 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 of the
company for that period;
The Directors had taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act 1956 for safeguarding the assets of the company and for
preventing and detecting fraud and other irregularities;
The Directors had prepared the annual accounts on a going concern
basis.
DIRECTORS
As per the Companies Act, 1956, atleast 2/3 of the board should
consists of retiring Directors. Of these, atleast 1/3 are required to
retire every year by rotation. ERs.cept Chairman and Vice Chairman, all
other Directors are liable to retire by rotation.
Mr. Kasi K Goundan, Dr. Mohan S Gounder and Mr.M. Manickam retire by
rotation at the forthcoming Annual General Meeting and being eligible,
offer themselves for re-appointment.
The Board of Directors deeply regret the sad demise of Mr.K.M.
Subramaniam, Alternate Director. The Board places on record the
invaluable contribution made by Mr.K.M. Subramaniam towards the
progress of the Company during his tenure.
APPOINTMENT OF JOINT MANAGING DIRECTOR
The Board of Directors at their meeting held on 18.05.2013 has
appointed Dr. Mohan S Gounder as Joint Managing Director of the Company
for a period of five years with effect from 19.07.2013. The terms and
conditions of the appointment and payment of remuneration are subject
to the approval of the members of the Company at the ensuing Annual
General Meeting. Necessary resolution is placed before the members for
their approval.
SUBSIDIARY COMPANY
Idhayam Hospitals Erode Limited had become wholly owned subsidiary of
KMCH with effect from 23.04.2007. The Ministry of Corporate Affairs
(MCA) vide its circular No.5/12/2007-CL-lll dated 8,h February 2011 had
granted general eRs.emption under Section 212(8) of the Companies Act,
1956 to companies from attaching the accounts of their subsidiaries in
their annual reports subject to fulfillment of certain conditions
prescribed.
The Board of Directors of the Company at its meeting held on May 18,
2013 noted the provisions of the circular of the MCA and passed
necessary resolution granting the requisite approvals for not attaching
the Balance Sheet, Statement of Profit and Loss, Report of the Board of
Directors and Report of the Auditor of Idhayam Hospitals Erode Limited
to the accounts of the company. A statement of summarized financials of
Idhayam Hospitals Erode Limited pursuant to Section 212(8) of the
Companies Act 1956 forms part of this report.
However the Company will provide the annual report and the financial
statements of its Subsidiary Company on the specific request made by
any investor and the said accounts are open for inspection at the
registered office of the Company during office hours on all working
days between 2.00 p.m. to 4.00 p.m. (eRs.cept Sundays and holidays).
CONSOLIDATED FINANCIAL STATEMENTS
As required under Clause 32 of the listing agreement with the Stock
ERs.changes and in accordance with the requirements of Accounting
Standard AS-21 issued by the Institute of Chartered Accountants of
India, the Consolidated Financial Statements presented by your company
includes the financial information of its subsidiary also.
PARTICULARS OF EMPLOYEES
The statement containing particulars of the employees as required under
Section 217(2A) of the Companies Act, 1956 read with Companies
(Particulars of Employees) Rules, 1975, as amended, forms part of this
Report. However, in terms of Section 219(1)(b)(iv) of the Companies
Act, 1956, the annual report eRs.cluding the aforesaid information is
being sent to all the members. Such particulars may be obtained by any
member, by writing to the Company Secretary at the Registered Office of
the Company.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN ERs.CHANGE
Particulars required under Section 217(1)(e) of the Companies Act,
1956, read with the Companies (Disclosure of Particulars in the Report
of the Board of Directors) Rules, 1988 regarding Conservation of
Energy, Technology Absorption has been dealt in our Directors'' Report.
The particulars regarding foreign eRs.change inflow and outgo appear as
note no.32 forming part of the accounts.
FIRs.ED DEPOSITS
As per Section 58A of the Companies Act, 1956, the Company has not
accepted any deposits from the public during the year.
AUDITORS
The Auditors M/s Haribhakti & Co., Chartered Accountants, Coimbatore
retire at the ensuing Annual General Meeting and have confirmed their
eligibility and willingness to accept office, if re-appointed.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the listing agreement a report on corporate
governance is given in the section titled "Report on Corporate
Governance" forming part of this Annual Report.
A certificate from the Auditors of the Company regarding compliance of
the conditions of corporate governance as stipulated under Clause 49 of
the Listing Agreement entered into with the Stock ERs.changes is
attached to this report.
CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis describing the
health care sector''s objectives, projections, estimates and
eRs.pectations may constitute "forward looking statements" within the
meaning of applicable laws and regulations. Actual results might differ
materially from those either eRs.pressed or implied.
ACKNOWLEDGEMENTS
Your Directors place on record their appreciation for the continued
support to the company eRs.tended by bankers, Govt, authorities,
customers, vendors, investors, members, consultants and employees.
For and on behalf of the Board
Coimbatore DR. NALLA G PALANISWAMI
18.05.2013 CHAIRMAN AND MANAGING DIRECTOR
Mar 31, 2012
The Directors take pleasure in presenting the Twenty Sixth Annual
Report of your company together with Audited Financial Statements for
the year ended 31 March 2012.
FINANCIAL RESULTS (Rs in lacs)
2011-12 2010-11
Operating Income 22237.24 17472.01
Other income 156.15 123.29
Total Income 22393.39 17595.30
Total Expenditure 17860.90 13868.42
Operating Profit 4532.49 3726.88
Less: Finance Charges & Depreciation 2908.40 1773.94
Profit Before Tax (PBT) 1624.09 1952.94
Less: Taxation 429.19 743.30
Profit After Tax 1194.90 1209.64
DIVIDEND
Your Directors are pleased to recommend the payment of dividend for the
year ended 31st March 2012 at Rs 1.25 per share. The proposed dividend
absorbs Rs 136.78 lacs for dividend and Rs 22.19 lacs for Dividend Tax.
As per Indian Income Tax Act, the dividend payable by the Company is
Tax free in the hands of shareholders.
TRANSFER TO RESERVES
The Company proposes to transfer Rs 100 lacs to the general reserve out
of the amount available for appropriation and an amount of Rs 935.93
lacs is proposed to be retained in the surplus in statement of Profit
and Loss.
OPERATING RESULTS AND PROFITS
During the year under review the total revenue of the company has
increased to Rs 22393.39 lacs from Rs 17595.30 lacs in the previous year
registering an impressive growth of 27%. The profit after tax stood atRs
1194.90 lacs against Rs 1209.64 lacs in the previous year. The net
profit of the company has not increased proportionate to the revenues
due to higher finance cost, increased provision for deferred tax
liability and depreciation consequent to the major expansion embarked
by your Hospital.
CORPORATE SOCIAL RESPONSIBILITIES
In its role as socially responsible corporate citizen, your company
reaches out to the needy sections of the society in many ways. We have
been continuously organizing various Continuous Medical Education
Programmes (CME), medical camps which provides free medical care
besides health awareness and education. During the year free
consultation camp on endoscopic spine surgery, fertility care, cancer
awareness programmes, free camp for diabetes were conducted.
FACILITY I TRsGRADATION AND EXPANSION
In order to add comfort to patients, significant renovation and
upgradation was undertaken during this year. This will not only enhance
the patient care but also facilitate achieving more operational
efficiencies. Among others we have added 7 new operation theaters.
Neonatal ICU, separate Cardio Thoracic Unit, Nuclear Medicine Dept.,
Medical ICU, Modernisation of Surgical ICU, Day Care centers for cancer
and cardiac patients. During the year we have added 210 patient beds,
an Isolation Ward, two Pharmacy outlets etc.
The expansion envisaged during the year 2007-08 was entirely completed
in this current year except for some minor work. The total project
spending was Rs 269 crores against which we have borrowed a sum ofRs 214
crores and the balance being from internal accruals.
INFECTION CONTROL AND ENVIRONMENT
Infection control is the discipline concerned with preventing
nosocomial or healthcare associated infection in Hospitals. Your
Hospital is giving special thrust to infection control and have
established an Infection Control Committee to monitor and regulate
infection at the Hospital. The improvement exhibited in the infection
control indices shows encouraging results. The infection rates are well
within the accepted standard level and favourably compares with similar
well established hospitals in India.
TECHNOLOGY ABSORPTION
Your Hospital continues to believe in investing in cutting edge
technology by bringing world class medical equipments and the latest
facilities in the medical care.
PET CT : The Siemens Biograph -6, state of the arts whole body PET
Scanner with a diagnostic 6 slice CT Scanner enables whole body staging
of cancer in a single step. This revolutionary modality images the
metabolic status of the cancer cells through a PET and structural
changes with a contrast enhanced CT Scan thus making it a one stop
imaging platform. Thus the need for multiple regional scans are
eliminated, saving patient time and decreasing the time gap from
diagnosis to initiation of appropriate treatment. A whole body PET-CT
is currently the gold standard for initial staging, post treatment
assessment and evaluation of recurrence in cancer.
SPECT : The Symbia T from Siemens, a dual headed variable angle gamma
camera with a diagnostic CT enabling the highest image quality and
resolution currently available in the world, reducing radiation
exposure to the patient and faster scanning time are some of the
features of this Gamma camera equipped with cutting edge technology.
SPECT-CT of the skeletal system, cardiac perfusion imaging, cancer
thyroid evaluation, neuro psychiatric functional and molecular imaging,
renal function & GFR assessment etc. are done with high end precision
and negligible inter observer variation, thus redefining the standard
in functional imaging.
Your hospital has also recently added 3T MRI, PACS, Mammography and
other equipments. Your hospital has added new medical facilities
amounting toRs 3754.84 lacs during the current year under review.
CONSERVATION OF ENERGY
Your company has undertaken various measures in conserving energy and
has installed Building Management System (BMS) to continuously monitor
and control all Air Humidifying Units (AHUs) and the resultant power
consumption.
Your hospital continuously reviews the energy generation and its
consumption and ensures periodical maintenance of the plant to conserve
energy. We have installed solar power lights and water heaters wherever
possible.
LED lights and fixtures are introduced in a phased manner to reduce
power consumption. Push type water taps are installed in the hospital
premises to reduce water wastage.
Waste water is being recycled by Effluent Treatment Plant (ETP) and is
being used wherever possible.
CARE RATING
CARE Rating has confirmed the financial credit rating of'CARE BBB'
(Triple B) for the revised long term facilities and 'CARE A3' (AThree)
for short term facilities.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The growth in high income countries is going to be weak, Developing
countries will have to search increasingly for growth within the
developing world. Under these conditions prospects and growth rates
that seems relatively easy to achieve during the first decade of this
millennium may become much more difficult to attain in the second.
HEALTH CARE SCENARIO
The health care economy is generally resilient and is not impacted by
recessions. Even though the world economy is weak, the health care
industry has remained largely insulated.
The Indian healthcare industry is estimated to be valued at Rs 2.8
trillion in size in Financial Year 2011, growing at a 5 year CAGR of
13,1% p.a. CARE Research estimates healthcare industry has the
potential to almost double to Rs 5.0 trillion over the next five years,
implying a growth rate of 12% p.a. This will be mainly driven by rise
in per capita spending on health care, change in demographic profile,
transition in disease profile, increase in health insurance penetration
and fast growing medical tourism market.
OUTLOOK AND FUTURE PROSPECTS
The health care sector in India is poised for rapid growth in the
medium term. The Hospital has under gone NABH (National Accreditation
Board for Hospitals and Healthcare Providers) accreditation process and
is quite confident of getting it.
Our domain expertise coupled with the state of the art equipments and
the quality of services have made the Hospital a leader. The demand for
treatment from the domestic front is encouraging and continues to be
robust. The Hospital is also planning to embark on attracting
international patients in a big way.
A combination of demographic and economic factors is going to impact
health carc industry in India. Increase in population, shift in
demographics, rise in disposable income, increase in incidence of
lifestyle related diseases, rising literacy are the few drivers that
propels the growth of health care industry.
COMPREHENSIVE CANCER CENTER
The Comprehensive Cancer Center was inaugurated by his Excellency
Dr.K.Rusaiah, Governor of Tamil Nadu on 07.11.2011. The center is a
world class facility with state of the art infrastructure providing the
entire range of services including awareness, detection and treatment
for different types of cancers. The center has a well knit team across
radiation oncology, surgical oncology, medical oncology and nuclear
medicine.
OPPORTUNITIES Medical Tourism
Medical Tourism is a highly growing sector in India and is expected to
experience an annual growth rate of 30%. Medical tourism is one of the
foremost external drivers that fuel the growth of health care industry.
The state of the art medical equipments, reputed health care
professionals, quality nursing facilities, best in class treatment, low
cost treatment etc. attracts foreign patients to look for treatment in
India.
Rising Investments
Strong demand for hospital services in tier 2 and 3 cities is bound to
fuel the growth of the health care sector in India. In recent years
there have been considerable investments from domestic players,
financial investors as well as private equity firms in the corporate
health care sector.
Health Insurance
The nature of health problems are changing rapidly and the cost of the
treatment is also increasing. The increase in organisation has led to
higher incidence of life related diseases. Now more number of people in
the urban and semi urban areas are opting for health insurance in view
of the rising health care costs. The health insurance is one of the
fastest growing segments in our country.
RISKS, CHALLENGES AND THREATS Talent Pool
The Indian health care sector is one of the latest service providers
and employs millions of work force. Shortage of doctors and skilled
manpower like nurses, technicians is plaguing the health care industry.
The urban-rural divide, lack of adequate training to the health care
workers, inadequate HR policies in the system are the areas which
hampers the growth of the health care industry in our country
Investments
The health care sector is a capital intensive sector and need
significant funding to grow.
Inflation and rising cost
The impact of inflation and the ever increasing operating cost of the
health care industry like salaries, administrative cost, fuel cost,
increase in interest cost are the various factors which affect the
health care deliver}' in India.
Competition by private sectors and obsolesce of medical equipments due
to rapid technological changes are the various challenges faced by the
health care industry.
A. FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE
Financial performance with respect to operational performance has been
dealt with in the Directors' Report which should be treated as forming
part of this Management Discussion and Analysis Report.
B. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has established an appropriate system of internal control
to ensure that there exists a proper control over all the transactions
and that all its assets are properly safeguarded and not exposed to
risk arising out of unauthorized use or disposal.
The Company has put in place adequate internal controls to ensure that
assets are safeguarded and protected against loss from unauthorized use
of disposition and the transactions are authorized, recorded and
reported correctly.
The internal audit department together with an independent firm of
Chartered Accountants reviews the effectiveness of the systems and
procedures. The internal auditors evaluate the adequacy of the internal
control systems by analyzing and testing controls and make their
recommendations to the management to improve controls wherever
necessary.
C.MATERIAL DEVELOPMENT IN HUMAN RESOURCES / INDUSTRIAL RELATIONS FRONT,
INCLUDING NUMBER OF PEOPLE EMPLOYED
Relations with the employees remained cordial throughout the year. In
order to optimize the contribution of the employees to the Company's
business and operations, in-house training is given to the employees to
induce contribution for increased productivity. We have also devised
development programmes for all levels of employees. As on 31 st March
2012 the employee strength of the Company was 1647.
DIRECTORS RESPONSIBILITY STATEMENT AS PER SECTION 217(2AA) OF THE
COMPANIES ACT 1956
In the preparation of Profit and Loss Account for the year ended 31st
March 2012 and the Balance Sheet as on that date, all the applicable
accounting standards have been followed. Accounting policies, that are
reasonable and prudent, have been selected and applied consistently 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 the Profit and Loss Account of the
Company for the year ended 31st March 2012. The said Profit and Loss
Account and Balance Sheet have been prepared on a going concern basis.
The Company maintains proper records in accordance with the provisions
of the Companies Act 1956, for safeguarding the assets of the Company
as also for preventing and detecting fraud and other irregularities.
DIRECTORS
Mr. A.K.Venkatasamy, Mr. A.M.Palanisamy and Dr.P.R.Perumalswami retire
by rotation at the forthcoming Annual General Meeting and being
eligible, offer themselves for re-appointment.
The Board places on record the conferment of "DOCTORATE" awarded by the
Bharathiar University and also another award viz. "LIFE TIME
ACHIEVEMENT AWARD" conferred by Dr.M.G.R. University, Chennai to our
Chairman and Managing Director Dr.Nalla G Palaniswami for his excellent
and outstanding performance in the field of medicine.
SUBSIDIARY COMPANY
The entire Share Capital of Idhayam Hospitals Erode Limited was
acquired on 23.04.2007 and in view of this Idhayam Hospitals Erode
Limited has become wholly owned subsidiary of the Company effective
from the above date.
The Ministry of Corporate Affairs, Govt, of India vide its circular
2/2011 dated 28th February 2011 has granted an exemption to the
Companies under Section 212(8) of the Companies Act 1956 from attaching
accounts along with the report of the Board of Directors as required by
Section 212( 1) of the Companies Act 1956 of the Subsidiary Companies
to the Balance Sheet of the holding Company .for the Financial Year
ended 31.3.2012. However the Company will provide the annual accounts
of its Subsidiary Company and the related detailed information on the
specific request made by any investor and the said accounts are open
for inspection at the registered office of the Company during office
hours on all working days, except Sundays and holidays between 2.00
p.m. to 4.00 p.m.
Particulars relating to the Subsidiary Company as per the conditions
mentioned in the circular issued by the Ministry of Corporate Affairs
are annexed to the accounts of the Company.
As required under Clause 32 of the listing agreement with the Stock
Exchanges and in accordance with the requirements of Accounting
Standard AS-21 issued by the Institute of Chartered Accountants of
India, the Company has prepared Consolidated Financial Statements of
the Company and its Subsidiary are included in the Annual Report.
PARTICULARS OF EMPLOYEES
The statement containing particulars of the employees as required under
Section 217(2A) of the Companies Act 1956 read with Companies
(Particulars of Employees) Rules 1975, as amended, forms part of this
Report. However, in terms of Section 219(1 )(b)(iv) of the Companies
Act 1956, the Report and Accounts are being sent to the members
excluding this Statement. Copies of this statement may be obtained by
the members by writing to the Company Secretary at the Registered
Office of the Company.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
Particulars required under Section 217( 1 )(e) of the Companies Act
1956, read with the Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules 1988, regarding Conservation of Energy,
Technology Absorption has been dealt in our Directors' Report. The
particulars regarding foreign exchange inflow and outgo appear as note
no.31 forming part of the accounts.
FIXED DEPOSITS
As per Section 58A of the Companies Act 1956, the Company has not
accepted any deposits from the public during the year.
AUDITORS
M/s Haribhakti & Co., Chartered Accountants, Coimbatore are the
auditors of the company and holds office upto the ensuing Annual
General Meeting of the Company and being eligible, offer themselves for
re-appointment.
REPORT ON CORPORATE GOVERNANCE
The Company has already complied with the requirement of the corporate
governance in terms of the listing agreement with the Stock Exchanges.
The detailed report on corporate governance is annexed and forming part
of this report. A certificate from the Auditors of the Company
regarding compliance of conditions of corporate governance as
stipulated under Clause 49 of the Listing Agreement entered into with
the Stock Exchanges is attached to this report.
HUMAN RESOURCES DEVELOPMENT
As your Company is in the service industry, human resource plays a very
crucial role in the operations and as such your Company accords great
recognition for its continuous development.
Your Company enjoys cordial relations with Doctors and Employees. Your
Board places on record its appreciation for the dedicated services of
all the Doctors and Employees.
CAUTIONARY STATEMENT
Statements in this Management Discussion and Analysis describing the
company's objectives. Projections, estimates and expectations may
constitute "forward looking statements" within the meaning of
applicable laws and regulations. Actual results might differ
materially from those either expressed or implied.
ACKNOWLEDGEMENTS
Your Directors place on record their appreciation for the continued
co-operation extended by the Bankers of the company and look forward to
their continued support in the future.
For and on behalf of the Board
Coimbatore DR. NALLA G PALANISWAMI
May 29, 2012 CHAIRMAN AND MANAGING DIRECTOR
Mar 31, 2011
Dear Members,
The Directors take pleasure in presenting the Twenty Fifth Annual
Report together with the Audited Statement of Accounts for the
Financial Year ended March 31, 2011.
FINANCIAL RESULTS (Rs. in Lacs)
Particulars 31.3.2011 31.3.2010
Revenues 17595.30 13193.41
EBIDTA 3726.88 2675.66
Less: Finance cost 1111.24 483.71
Depreciation 662.70 468.80
Earnings Before tax 1952.94 1723.15
Less: Provision for Taxation 743.30 564.57
Earnings After Tax 1209.64 1158.58
Add: Balance brought forward 585.72 486.64
Amount available for appropriation 1795.36 1645.22
Dividend (Inclusive of Dividend Tax) 158.97 159.50
Transfer to General Reserve 1000.00 900.00
Balance carried forward to Balance Sheet 636.39 585.72
DIVIDEND
Your Directors are pleased to recommend the payment of dividend for the
year ended March 31, 2011 at (Rs.1.25 per share). The proposed dividend
absorbs Rs. 137 Lacs for dividend and Rs. 22 Lacs for Dividend Tax. As
per Indian Income Tax Act, the dividend payable by the Company is Tax
free in the hands of shareholders.
BUSINESS PERFORMANCE
The results for the year 2010-11 continues to be commendable. Your
Hospital has achieved a revenue of Rs. 17595.30 Lacs posting a robust
growth of 33%. The EBIDTA stood at Rs. 3726.88 Lacs as against Rs.
2675.66 Lacs in 2009-10.
All the Centers have performed well and have improved on their revenues
and profitability. The overall after tax profitability of the Hospital
is Rs. 1209.64 Lacs for the period under review as against the profit
of Rs.1158.58 Lacs of that of the previous year.
The major expansion programme embarked by the Hospital has started
yielding dividends and the same is reflected by the impressive growth
achieved by it. Though our Hospital could maintain the same operational
profit, the increased finance cost, higher depreciation and increased
provision for deferred tax liability due to the capital spending has
reduced the profit margin after taxation.
TECHNOLOGY ABSORPTION
In our Quest to give the best health care facilities to the patients,
your Hospital always believe in upgrading the technology by the
state-of-the-art medical equipments.
During the year under review, your Company has added Magnetom Skyra 3T
System, PACS, Mammography System, Triology High Energy Linear
Accelerator, Artis Zee Biplane, Ventilators, Monitors etc. to deliver
health care at par with international standards. SPECT CT and PET CT
for cancer treatment will be added very shortly.
We have installed new medical equipments amounting to Rs. 5126.60 Lacs
which are the best and latest available in medical world.
CONTINUOUS MEDICAL EDUCATION PROGRAMMES (CME)
Your company gives utmost importance to Continuous Medical Education
(CME) Programmes as it is always in the forefront and drives in
bringing the latest developments in the medical world to India.
Your company organized many Seminars, Workshops, Camps and Exhibitions
in the field of Cancer, Cardiology, Neurology, Paediatric, Urology,
General Medicine, Diabetic etc and conducted an International
Conference Kovai Lumen 2011, Two National Conferences, ICU Update 2010
and TIP 2010.
Your company has conducted many CME Programmes outside Coimbatore for
the benefit of medical professionals who always play a vital role in
educating the patients and community at large about the latest
developments in the health care industry .
CORPORATE SOCIAL RESPONSIBILITIES
As a responsible corporate citizen, your Company has organized many
free medical camps in rural parts of Tamil Nadu and as part of its
efforts to propagate healthcare and provide services to the poor at
their door step. It has also conducted many awareness programmes among
the public.
During the year your company has conducted Health awareness programmes,
Cancer awareness programmes, Diabetic awareness campaigns, Disaster
Control Management etc. and it will continue to undertake many such
programmes as part of its corporate philosophy and social
responsibility.
AWARDS
Your Hospital has been awarded the best IT enabled Hospital for the
year 2010 by Ministry of Communication & IT, Ministry of Corporate
Affairs, Govt. of India.
Your Hospital has been awarded the National Energy Conservation Award
for 2010 for excellence in energy conservation in the country from the
Bureau of Energy Efficiency (BEE) under the Ministry of Power, Govt. of
India.
CARE RATING
CARE Rating has confirmed the financial credit rating of Rs.CARE BBB'
(Triple B) for the enhanced long term facilities and Rs.PR 3' (PR
Three) for short term facilities.
DIRECTORS RESPONSIBILITY STATEMENT AS PER SECTION 217(2AA) OF THE
COMPANIES ACT 1956
In the preparation of Profit and Loss Account for the year ended March
31, 2011 and the Balance Sheet as on that date, all the applicable
accounting standards have been followed. Accounting policies, that are
reasonable and prudent, have been selected and applied consistently 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 the Profit and Loss Account of the
Company for the year ended March 31, 2011. The said Profit and Loss
Account and Balance Sheet have been prepared on a going concern basis.
The Company maintains proper records in accordance with the provisions
of the Companies Act 1956, for safeguarding the assets of the Company
as also for preventing and detecting fraud and other irregularities.
DIRECTORS
Mr.K.Saminathan, Dr.M.C.Thirumoorthi and Dr.K.S.K.Murugaiyan retire by
rotation at the forthcoming Annual General Meeting and being eligible,
offer themselves for re-appointment.
SUBSIDIARY COMPANY
The entire Share Capital of Idhayam Hospitals Erode Limited was
acquired on 23.4.2007 and in view of this Idhayam Hospitals Erode
Limited has become wholly owned subsidiary of the Company effective
from the above date.
The Ministry of Corporate Affairs, Govt. of India vide its circular
2/2011 dated 8th February 2011 has granted an exemption to the
Companies under Section 212(8) of the Companies Act 1956 from attaching
accounts along with the report of the Board of Directors as required by
Section 212(1) of the Companies Act 1956 of the Subsidiary Companies to
the Balance Sheet of the holding Company for the Financial Year ended
31.3.2011. However the Company will provide the annual accounts of its
Subsidiary Company and the related detailed information on the specific
request made by any investor and the said accounts are open for
inspection at the registered office of the Company during office hours
on all working days, except Sundays and holidays between 2.00 p.m. and
4.00 p.m.
Particulars relating to the Subsidiary Company as per the conditions
mentioned in the circular issued by the Ministry of Corporate Affairs
are annexed to the accounts of the Company.
As required under Clause 32 of the listing agreement with the Stock
Exchanges and in accordance with the requirements of Accounting
Standard AS-21 issued by the Institute of Chartered Accountants of
India, the Company has prepared Consolidated Financial Statements of
the Company and its Subsidiary are included in the Annual Report.
PARTICULARS OF EMPLOYEES
As on March 31, 2011, none of the employee was in receipt of
remuneration in excess of the limits prescribed in sub-section 2A of
Section 217 of the Companies Act 1956, read with Companies (Particulars
of Employees) Amendment Rules 1994.
INFORMATION AS PER SECTION 217(1)(E) OF THE COMPANIES ACT, 1956
Since the Company is in service industry and does not do any
manufacturing activity, the particulars regarding conservation of
energy and technology absorption in the Companies (Disclosure of
Particulars in the Report of the Board of Directors) Rules 1988 are not
applicable. The particulars regarding foreign exchange inflow and outgo
appear as item No.10 in Notes on Accounts.
FIXED DEPOSITS
As per Section 58A of the Companies Act 1956, the Company has not
accepted any deposits from the public during the year.
AUDITORS
M/s Haribhakti & Co., Chartered Accountants, Coimbatore are the
Auditors of the Company and holds office up to the ensuing Annual
General Meeting of the Company and being eligible, offer themselves for
re- appointment.
REPORT ON CORPORATE GOVERNANCE
The Company has already complied with the requirement of the corporate
governance in terms of the listing agreement with the Stock Exchanges.
The detailed report on corporate governance is annexed and forming part
of this report.
COMPLIANCE CERTIFICATE ON CORPORATE GOVERNANCE
A certificate from the Auditors of the Company regarding compliance of
conditions of corporate governance as stipulated under Clause 49 of the
Listing Agreement entered into with the Stock Exchanges is attached to
this report.
HUMAN RESOURCES DEVELOPMENT
As your Company is in the service industry, human resource plays a very
crucial role in the operations and as such your Company accords great
recognition for its continuous development.
Your Company enjoys cordial relations with Doctors and Employees. Your
Board places on record its appreciation for the dedicated services of
all the Doctors and Employees.
ACKNOWLEDGEMENTS
Your Directors place on record their appreciation for the continued
co-operation extended by the Bankers of the company and look forward to
their continued support in the future.
For and on behalf of the Board
COIMBATORE DR.NALLA G PALANISWAMI
18.05.2011 CHAIRMAN AND MANAGING DIRECTOR
Mar 31, 2010
The Directors take pleasure in presenting the Twenty Fourth Annual
Report together with the Audited Statement of Accounts for the
Financial Year ended 31st March 2010.
FINANCIAL RESULTS (Rs. in Lacs)
Particulars 31.3.2010 31.3.2009
Revenues 13193.41 11152.94
Profit before interest and
depreciation 2675.66 1938.29
Less: Finance cost 483.71 443.43
Depreciation 468.80 391.54
Profit Before tax 1723.15 1103.32
Less: Provision for
Current Tax 484.40 311.00
Fringe Benefit Tax - 10.35
Deferred Tax 90.40 67.93
Earlier Year Tax (10.23) -
Profit After Tax 1158.58 714.04
Add: Balance brought forward 486.64 432.63
Amount available for appropriation 1645.22 1146.67
DIVIDEND
Your Directors are pleased to recommend the payment of dividend for the
year ended 31st March 2010 at 12.50% (Rs.1.25 per share). The proposed
dividend absorbs Rs.136.78 Lacs for dividend and Rs.22.72 Lacs for
Dividend Tax. As per Indian Income Tax Act, the dividend payable by the
Company is Tax free in the hands of shareholders.
BUSINESS PERFORMANCE
The results for the year 2009-10 is impressive. The Company has
achieved an over all growth in revenue by 18% over the previous year.
All the Hospital Centers have performed well. The improvement in
performance of Erode Speciality Hospital has also contributed to the
profitability of the Company. The profit after taxation stood at
Rs.1158.58 Lacs for the year under review and the same was Rs.714.04
Lacs for the previous year.
The operational excellence in providing quality healthcare to the
patients at affordable costs coupled with increase in bed capacity has
contributed to the good performance of the Company. All the Hospital
Centers have registered increase in revenue and improvement in
profitability.
TECHNOLOGY ABSORPTION
During the year under review, your Company has added the latest Broncho
Video Fiberoscope, Endoscopy Unit with Accessories, Colour Doppler,
Carl Zeiss Microscope-, Heamodialysis Machines, Ventilators etc. to
deliver quality health care at par with international standards. We
have installed new medical equipments amounting to Rs.692 Lacs which
are the best in medical world and we continue to make large investments
in bringing the latest in the medical technology to India.
CONTINUOUS MEDICAL EDUCATION PROGRAMMES (CME)
To keep abreast of the latest developments in medical care, your
Hospital has conducted national and international conferences during
the year and was well attended by delegates from within the country and
abroad. Your company has conducted an International Conference Kovai
Lumen 2010 and two National Conferences, ICU Update 2009 and TIP 2009.
During the year, your Company has organized many Seminars, Conferences,
Workshops and Exhibitions in the field of Cardiology, Critical Care and
Gastro Enterology.
CORPORATE SOCIAL RESPONSIBILITIES
In its role as a socially responsible corporate citizen, your Company
reaches out to the needy sections of the society in many ways. We have
been continuously organizing many free medical camps which provide free
medical care besides health awareness and education. During the year,
free consultation camp on Endoscopic Spine Surgery, Fertility Care,
Cancer awareness Programme, Free camp of Diabetes were conducted.
FINANCE
Your Company holds credit rating of CARE BBB (Triple B) rating to the
long term facilities and PR 3 (PR Three) rating to the short term
facilities.
Finance continued to be a focus area. Regular project reviews with
special focus on cash flow and good working capital management has
helped the Company to manage the cash flows effectively. During the
year we have availed a term loan of Rs. 4406.49 Lacs.
DIRECTORS RESPONSIBILITY STATEMENT AS PER SECTION 217(2AA) OF THE
COMPANIES ACT 1956
In the preparation of Profit and Loss Account for the year ended 31st
March 2010 and the Balance Sheet as on that date, all the applicable
accounting standards have been followed. Accounting policies, that are
reasonable and prudent, have been selected and applied consistently 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 the Profit and Loss Account of the
Company for the year ended 31st March 2010. The said Profit and Loss
Account and Balance Sheet have been prepared on a going concern basis.
The Company maintains proper records in accordance with the provisions
of the Companies Act 1956, for safeguarding the assets of the Company
as also for preventing and detecting fraud and other irregularities.
DIRECTORS
Mr.Kasi K Goundan, Dr.Mohan S Gounder and Mr. M. Manickam retire by
rotation at the forthcoming Annual General Meeting and being eligible,
offer themselves for re-appointment.
In accordance with Section 260 of the Companies Act 1956,
Dr.M.A.Muthusethupathi has been inducted as an Additional Director by
the Board with effect from 25.7.2009.
Mr.K.N.V. Ramani who was appointed as Director of the Company with
effect from 29.8.2008 resigned from the Board with effect from
25.7.2009.
Dr.S.Krishnasamy who was appointed as Alternate Director resigned from
the Board with effect from 5.6.2009.
The Board of Directors places on record their deep appreciation of the
valuable services rendered, advice and guidance provided by
Mr.K.N.V.Ramani and Dr.S.Krishnasamy as Directors of the Company during
theirtenure.
APPOINTMENT OF JOINT MANAGING DIRECTOR
The term of office of Dr.Thavamani Devi Palaniswami, Joint Managing
Director of the Company expires on 28" July 2010. The Board of
Directors have re-appointed Dr.Thavamani Devi Palaniswami as Joint
Managing Director for a further period of five years from 29.7.2010.
The terms and conditions of her re-appointment and payment of
remuneration are subject to the approval of the members of the Company.
Necessary resolution is placed before the members for their approval.
SUBSIDIARY COMPANY
The entire Share Capital of Idhayam Hospitals Erode Limited was
acquired on 23.4.2007 and in view of this Idhayam Hospitals Erode
Limited has become wholly owned subsidiary of the Company effective
from the above date.
The Ministry of Corporate Affairs, Govt, of India vide its order
No.47/316/2010-CL-III dated 9lh April 2010 has granted an exemption to
the Company under Section 212(8) of the Companies Act 1956 from
attaching the accounts along with the report of the Board of Directors
as required by Section 212(1) of the Companies Act 1956, of its
Subsidiary Company M/s dhayam Hospitals Erode Limited to the Balance
Sheet of the Company for the Financial Year ended on 31.3.2010. The
Company will provide the annual accounts of its Subsidiary Company and
the related detailed information on the specific request made by any
investor and the said accounts are open for inspection at the
registered office of the Company during office hours on all working
days, except Sundays and holidays between 2.00 p.m. to 4.00 p.m.
Particulars relating to the Subsidiary Company as per the condition
(iii) of the above mentioned order of the Ministry of Corporate Affairs
are annexed to the accounts of the Company.
As required under Clause 32 of the listing agreement with the Stock
Exchanges and in accordance with the requirements of Accounting
Standard AS-21 issued by the Institute of Chartered Accountants of
India, the Company has prepared Consolidated Financial Statements of
the Company and its Subsidiary are included in theAnnual Report.
PARTICULARS OF EMPLOYEES
As on 315t March 2010, none of the employees were in receipt of
remuneration in excess of the limits prescribed in sub-section 2A of
Section 217 of the Companies Act 1956, read with Companies (Particulars
of Employees) Amendment Rules 1994.
INFORMATION AS PER SECTION 217(1)(E) OF THE COMPANIES ACT, 1956
Since the Company is in service industry and does not do any
manufacturing activity, the particulars regarding conservation of
energy and technology absorption in the Companies (Disclosure of
Particulars in the Report of the Board of Directors) Rules 1988 are not
applicable. The particulars regarding foreign exchange inflow and outgo
appear as item no.8 in Notes on Accounts.
FIXED DEPOSITS
As per Section 58A of the Companies Act 1956, the Company has not
accepted any deposits from the public during the year.
DELISTING OF EQUITY SHARES
The Company has made an application to Madras Stock Exchange Limited
for delisting of Shares. The application is still pending with the
exchange.
APPOINTMENT OF AUDITORS
M/s. Suri & Co., Chartered Accountants have expressed their
unwillingness to continue as Statutory Auditors of the Company.
The Board proposed M/s Haribhakti & Co., Chartered Accountants as
Statutory Auditors of the Company in place of retiring auditors M/s
Suri & Co. M/s Haribhakti & Co. to hold office from the conclusion of
this Annual General Meeting until the conclusion of the next Annual
General Meeting.
The Board of Directors places on record their warm appreciation of the
valuable contribution made by M/s Suri & Co., Chartered Accountants
during their association with the Company.
REPORT ON CORPORATE GOVERNANCE
The Company has already complied with the requirement of the corporate
governance in terms of the listing agreement with the Stock Exchanges.
The detailed report on corporate governance is annexed and forming part
of this report.
COMPLIANCE CERTIFICATE ON CORPORATE GOVERNANCE
A certificate from the Auditors of the Company regarding compliance of
conditions of corporate governance as stipulated under Clause 49 of the
Listing Agreement entered into with the Stock Exchanges is attached to
this report.
HUMAN RESOURCES DEVELOPMENT
As your Company is in the service industry, human resource play a very
crucial role in the operations and as such your Company accords great
recognition therefore for its continuous development.
Your Company enjoys cordial relations with Doctors and Employees. Your
Board places on record its appreciation for the dedicated services of
all the Doctors and Employees.
ACKNOWLEDGMENTS
Your Directors place on record their appreciation for the continued
co-operation extended by the Bankers of the company and look forward to
their continued support in the future.
For and on behalf of the Board
Dr. NALLA G PALANISWAMI
CHAIRMAN AND MANAGING DIRECTOR
COIMBATORE
29.05.2010
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