Mar 31, 2015
The Directors are pleased to present the Twentieth Annual Report and the Company's audited financial statement for the financial year ended March 31,2015.
The Company's financial performance, for the year ended March 31,2015 is summarized below:
Rupees in Lakhs
PARTICULARS 2014-15 2013-14
Gross Income (including other income) 62,233,740 76,316,275
Profit before interest and depreciation 4203483 2993768
Less: Interest and financial charges 51527 63723
Profit Before depreciation 4151956 2930045
Less: Depreciation and amortization 3,412,347 2,168,290
Profit before tax 739,609 761,755
Provision for tax (including Deferred Tax) -501453 128827
Profit after tax 1241063 632927
Net Profit for the year 1241063 632927
Profit brought forward from previous year 632927
Profit available for appropriation 1873990
Appropriations: - -
Transfer to General Reserve - -
Dividend tax - -
Balance carried forward 1873990
Paid Up capital 83759600 83759600
Reserves and Surplus 733891737 732650674
RESULTS OF OPERATIONS AND THE STATE OFCOMPANY'S AFFAIRS
The highlights of the Company's performance are asunder:
Revenue from operations Rs. 62,233,740
PBDIT(Excluding Other Income) decreased by 17.68%
Profit before Tax decreased by 2.90%
Cash Profit increased by 41.70%
Net Profit increased by 96.08%
The order book position as on 31st March 2015 stands at Rs. 50 Lakhs.
The Company is not proposing to transfer any amount to the General Reserves of the Company out of the profits made during the year. The total Reserves & Surplus (including capital reserves, securities premium Reserves, General Reserves and P&L Account accumulated) as on 31st March 2015 is Rs. 733891737 as against the Paid-up capital of Rs. 837596000
The Board of Director of your company, keeping in view the financial positions of the company, has not recommended any Dividend For the Financial year 2014-15
Management Discussion and Analysis Statement
Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of Listing Agreement with the Stock Exchanges, is presented in a separate section forming part of the Annual Report.
Transfer to the Investor Education and Protection Fund
In terms of Section 125 of the Companies Act, 2013, no amount is required to transfer to the Investor Education and Protection fund (IEPF) established by the Central Government during the Financial year.
SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES
The Company does not have any subsidiaries or joint ventures.
Consolidated Financial Statements
The company does not have any subsidiaries or joint ventures, hence only standalone Financial Statements are provided to the shareholders of the company.
Directors' Responsibility Statement;
Pursuant to the requirements under Section 134 (3) (c ) of the Companies Act, 2013, with respect to Directors' Responsibility Statement, Your Directors hereby confirmed that:
(a) in the preparation of the annual accounts for the year ended March 31,2015, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;
b) the Directors have 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 as at March 31,2015 and of the profit of the Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a 'going concern' basis;
e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of this Report. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance.
In accordance with the requirements of the Companies Act, 2013 Mr. Vinay Madhukar Ganu and Mr. Rajaram Arjun Rambade, Director of the Company is liable to retire by rotation at the Annual General Meeting and, being eligible, offer themselves for reappointment at the ensuring Annual General Meeting.
Brief resume of the Director proposed to be reappointed, nature of their expertise in specific functional areas, names of the companies in which they hold directorships and relationships between directors inter- se, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, are provided in the Report on Corporate Governance.
The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under the Act and Clause 49 of the Listing Agreement with the Stock Exchanges.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which include criteria for performance evaluation of the non-executive directors and executive directors.
The Board of Directors has complete access to the information within the Company. Independent Directors have the freedom to interact with the Company's management. Interactions happen during Board / Committee meetings, when MD / ED are asked to make presentations about performance of the Company to the Board. Apart from this, they also have independent interactions with the Statutory Auditors, the Internal Auditors and external advisors appointed from time to time. Further, they meet without the presence of any management personnel and their meetings are conducted informally to enable the Independent Directors to discuss matters pertaining to the Company's affairs and put forth their combined views to the Board of Directors of the Company.
Pursuant to the provisions of Section 139(2) of the Companies Act, 2013, on rotation of audit firms, and based on the recommendation of the Audit Committee, the Board has at its meeting held on30th May 2015 recommended the appointment of M/s. D P Agarwal& Co., Chartered Accountants, as the Statutory Auditors of the Company to hold office from conclusion of this Annual General Meeting to the Conclusion of the next Annual General Meeting. M/s. D P Agarwal& Co., Chartered Accountants, , have confirmed that the appointment, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013. Accordingly, the appointment of M/s. D P Agarwal& Co., Chartered Accountants, Hyderabad, as the Statutory Auditors, is being proposed as an Ordinary Resolution
The Board has appointed M/s P Sateesh a Rao Company Secretaries, to conduct Secretarial Audit for the FY 2014-15. The Secretarial Audit Report for the financial year ended March 31,2015 is annexed herewith marked as Annexure II to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.
CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm's length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Out Go:
The particulars relating to Conservation of Energy, Technology absorption, Foreign Exchange earnings and outgo as required under section 217 (1) (e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 are as follows
a) Conservation of Energy
The Company has taken suitable measures for conservation of energy. The core activity of the company is civil construction that is not an energy intensive activity.
b) Technology absorption, Adoption and Innovation
There is no information to be furnished regarding Technology Absorption as your Company has not undertaken any research and development activity in any manufacturing activity nor any specific technology is obtained from any external sources, which needs to be absorbed or adopted.
Innovation is a culture in the Company to achieve cost efficiency in the construction activity to be more and more competitive in the prevailing environment that cannot be quantified.
Foreign Exchange earnings and outgo
Foreign Exchange Inwards - Nil
Foreign Exchange outgo towards: Nil
Your Company has not accepted any deposits covered by the provisions of Section 73 of the Companies Act, 2013 and the Rules framed there under.
Your Directors are happy to report that the Industrial Relations have been extremely cordial at all levels throughout the year. Your Directors record their appreciation for sincere efforts, support and co-operation of all employees being extended from time to time to accelerate the growth of the Company.
The Audit Committee comprises majority Independent Directors namely Mr. Surendra Naidu Rayapati, Mr. Thakur Ramesh Singh Chouhan and Mr. Solomon Daniel Bondugula as other members. All the recommendations made by the Audit Committee were accepted by the Board.
The Company has a Vigil mechanism and Whistle blower policy in terms of the Listing Agreement, under which the employees are free to report violations of applicable laws and regulations and the Code of Conduct. Protected disclosures can be made by a whistle blower through a dedicated e-mail, or a letter to the Chairman of the Audit Committee.
Meetings of the Board
Nine meetings of the Board of Directors were held during the year under review. For further details, please refer report on Corporate Governance of this Annual Report.
Code of Conduct
A declaration regarding compliance with the code of conduct signed by the Company's Managing Director is published in the Corporate Governance Report which forms part of the annual report.
Particulars of Loans given, Investments made, Guarantees given and Securities provided
Particulars of loans given, investments made, guarantees given and securities provided are provided in the standalone financial statement
Extract of Annual Return
Extract of Annual Return of the Company is annexed here with as Annexure III to this Report.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is as follows:
The percentage of increase in remuneration of each Director, Chief Financial Officer and Company Secretary during the financial year 2014-15, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2014-15 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance of the Company are as under:
Sl. Name of Director/KMP Remuneration of Director/ % increase in No. and Designation KMP for financial year Remuneration 2014-15 (Rs. in lakhs) in the Financial Year2014-15
1 Daniel Soloman 5,40,000 0% Managing Director
Sl. Name of Director/KMP Ratio of remuneration Comparison of No. and Designation of each Director/to the Remuneration median remuneration of the KMP of employees against the performance of the Company
1 Daniel Soloman 50 Profit before Tax Managing Director decreased by 2.90 and Profit After Tax increased by 96.08 in financial Year 2014-15
During the period under review, no employee of the Company is employed throughout the financial year and in receipt of Rs.60 lakhs or more, or employed for part of the year and in receipt of Rs.5 lakhs or more a month, under Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
ii) The median remuneration of employees of the Company during the financial year was Rs. 27,275 pm;
iii) In the financial year, there was increase of **% in the median remuneration of employees;
iv) There were 2 employees on the rolls of Company as on March 31,2015
v) Relationship between average increase in remuneration and company performance: - The Profit before tax for the financial year ended March 31, 2015 decreased by 2.90% whereas the median remuneration was the same as last year
vi) Comparison of Remuneration of the Key Managerial Personnel(s) against the performance of the Company:
The total remuneration of Key Managerial Personnel was Rs. 5,40,000 lakhs whereas the Profit before tax was Rs. 7,39,609 lakhs in 2014-15
vii) a) Variations in the market capitalisation of the Company: The market capitalisation as on March 31,2015 at NSE was Rs. 1,19,468.46 lakhs (Rs. 23,904.94 lakhs as on March 31,2014)
b) Price Earnings ratio of the Company at NSE was 16.36 as at March 31,2015 and was 3.92 as at March 31,2014;
viii) Average percentage decrease made in the salaries of employees other than the managerial personnel in the last financial year i.e. 2014-15 was 16.85% whereas the managerial remuneration for the same financial year was the same as last year
ix) The key parameters for any variable component of remuneration availed by the directors: Not applicable
x) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but received remuneration in excess of the highest paid director during the year - Not Applicable; and
xi) It is hereby affirmed that the remuneration paid is as per the Remuneration Policy for Directors, Key Managerial Personnel and other Employees.
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend, voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOP referred to in this Report.
4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.
Appreciation and Acknowledgements
Your Directors wish to place on record their gratitude to the Company's shareholders, customers, vendors and bankers for their continued support to KNRCL's growth initiatives Your Directors also wish to place on record, their appreciation of the contribution made by employees at all levels, who through their competence, sincerity, hard work, solidarity and dedicated support, have enabled your Company to make rapid strides in its business initiatives Your Directors also thank the Central and State Governments and their various agencies, particularly, the National Highway Authority of India and other Governmental agencies for extending their support during the year, and look forward to their continued support.
On behalf of the Board of Directors of Secunderabad Healthcare Limited
SOLOMON DANIEL BONDUGULA Rajaram Arjun Rambade Managing Director Executive Director
Place: Hyderabad Date: 14 Aug 2015
Mar 31, 2014
The Directors are happy to present their Twenty first Annual Report on the business and operations of the Company and the Financial statements for the year ended 31st March, 2014.
Particulars 2013-14 2012-13
Turnover 76,316,275 144,569,767
Profit before Tax ( ) / Loss (-) 761,755 410,017
Current Tax 145,152 376,481
Deferred Tax (16,325) (235,487)
Profit After Tax ( ) / Loss (-) 632,927 269,023
Your Company achieved a turnover of Rs. 76,316,275 /- in 2013-14 as compared to Rs. 144,569,767/- in 2012-13 and the net profit after tax stood at Rs. 632,927 /- for the current year as compared to Rs 269,023/- in the previous year.
The Company is committed to continue its efforts for the developmental activities and has several plans to sustain and improve the turnover and profitability in the future
Mr. Vinay Madhukar of the Company retires by rotation and being eligible, offers herself for re- appointment.
Mr. Rajaram Arjun Rambade, Whole-time Director of the Company retires by rotation and being eligible offers himself for re-appointment.
CORPORATE GOVERNANCE - CLAUSE 49 OF THE LISTING AGREEMENT:
A separate Section on Corporate governance with a detailed compliance report thereon is annexed to the Annual Report. The Company Secretary''s Certificate with respect to compliance with the provisions of Corporate Governance, as required by clause 49 of Listing Agreement, is also annexed.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT - CLAUSE 49 OF THE LISTING AGREEMENT:
A Separate Section on Management Discussion and analysis with a detailed compliance report thereon is annexed to the Annual Report
The Board of Directors keeping in view the need to augment internal accruals for toning up the financials, has not recommended any Dividend for the current financial year 2013-14.
TRANSFER TO THE INVESTOR EDUCATION AND PROTECTION FUND:
There are no unpaid dividend to be transferred to Investor Education and protection fund.
Your Company has not accepted any deposits covered by the provisions of Section 58AA of the Companies Act and the Rules framed there under.
The company has been enjoying cordial relations with its employees at all levels. Your Directors record their appreciation of the support and co-operation of all employees in the accelerated growth of the Company.
The Statutory Auditors M/s. D P Agarwal & Co., Chartered Accountants, Hyderabad retire at the ensuing Annual General Meeting. They have confirmed their eligibility and willingness to accept the assignment as Statutory Auditors of the company, if reappointed.
The Company has on its rolls, Venugopal Rao Brahmanapalli, an Associate member of the Institute of Company Secretaries of India, as the full time Secretary of the.
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:
No technology either indigenous or Foreign is involved
PARTICULARS OF EMPLOYEES:
The Directors are to report that none of the employee was in receipt of remuneration exceeding the limit prescribed under section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules 2011.
RESEARCH AND DEVELOPMENT (R & D):
The Company is taking steps to get Research and Development work carried out.
FOREIGN EXCHANGE EARNINGS: NIL FOREIGN EXCHANGE OUT GO: NIL
DIRECTORS'' RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 217(2AA):
Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 your Directors confirm:
1. That in the preparation of the accounts for the Financial Year ended 31st March, 2014, the applicable accounting standards have been followed along with proper explanation relating to material departures,
2. That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the said Financial year and of the Profit of the company for the said financial year.
3. That the Directors have taken proper and sufficient care for the maintenance of adequate, accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities,
4. That the Directors had prepared the accounts for the year ended 31st March, 2014 on a "going concern" basis.
Your Directors wish to express their sincere thanks to Bankers, Financial Institutions, Customers, suppliers for their continued support to the Company. The Directors also acknowledge with gratitude the continued support received from Investors, Shareholders and various Departments of State and Central governments.
Your directors'' place on record their appreciation of the Sincerity, Commitment and Contribution made by the Employees of the company at all levels, for the smooth functioning of the Company, during the year under review.
For and on behalf of the Board
Place: Hyderabad Mr. Daniel Solomon Bondugula Date: 14.08.2014. Chairman & Managing Director
Mar 31, 2012
To, The Shareholders
The Board of Directors of your Company hereby presents the 21st Annual Report on the Business & Operations of the Company and the Audited Statement of Accounts for the year ended 31st March, 2012 along with the Auditor's Report thereon.
(Amount in Rupees)
Particulars 2011- 2012 2010- 2011
Total Income 226,410,839 574,883,974
Total Expenditure 222,716,855 572,352,649
Profit before Tax 3,694,038 2,531,325
Provision for Tax
- Current Tax 553190 510,138
- Deferred Tax (1,800,478) -
Net Profit after Tax 4,941,327 2,021,187
Basic Earnings per Share 0.04 0.06
Diluted Earnings per Share 0.08 0.36
RESULTS OF OPERATIONS AND FUTURE OUTLOOK
Although the financial year 2012 marked a steady year for your Company amidst a highly uncertain global environment, your Company continued to maintain its focus on its fundamentals and embark on newer and more profitable segments and it was only the result of these efforts that your Company has been triumphant in achieving a Topline of Rs. 226,410,839/.
Also it is heartening to note that the Company could achieve success in curtailing its Overall Expenditures by about 61% as compared to the preceeding year which has resulted in an increase in the its overall profitability by 46%.
Thus, given the operational performance of your Company and the overall industry scenario, your Directors are hopeful of better prospects in the years to come.
In order to conserve the resources of the Company and to plough back the profits for future expansion, your Directors do not recommend any dividend for the year ended 31st March, 2012.
The Company has not accepted any Public Deposit under section 58A, 58AA, 58AAA read with Companies (Acceptance of Deposits) Rules, 1975 during the year under review.
PARTICULARS OF EMPLOYEES
There are no employees in the Company who are in receipt of a remuneration in excess of the limits prescribed under the provisions of section 217(2A) of the Companies Act, 1956 or drawing a remuneration more than the Managing Director.
Moreover, none of the employees are Relatives of the Directors as mentioned in the provisions of the aforesaid section.
The Statutory Auditors of the Company M/s D.P. Agarwal & Co. retire at the conclusion of the ensuing Annual General Meeting and being eligible have offered themselves for re- appointment.
Your Company has received confirmation from the Auditors to the effect that their reappointment, if made would be within the limits prescribed under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for re- appointment within the meaning of Section 226 of the said Act.
Thus the Board recommends the re- appointment of M/s. D.P. Agarwal & Co., Chartered Accountants as the Statutory Auditors of the Company for the tenure commencing from the conclusion of ensuing Annual General Meeting upto the next Annual General Meeting.
The Comments furnished in the Auditors Report on the Accounts of the Company are self- explanatory and thus do not call for any further explanation.
CHANGES IN THE CAPITAL STRUCTURE OF THE COMPANY
During the year under review, the Board of Directors of your Company undertook the conversion of pending 39,904,000 Convertible Equity Warrants in their Meeting held on 31st March, 2012. Consequent to the Conversion of the said warrants, the Paid- Up Share Capital of the Company stands at Rs. 837,596,000/- divided into 83,759,600 Equity Shares of Rs. 10/- each.
The Shares issued upon Conversion of the aforesaid Equity Warrants are locked- in for a period of 12 months i.e. till 30th March, 2013.
CHANGES IN THE COMPOSITION OF BOARD OF DIRECTORS
Mr. Medasani Munisekhar resigned from the Board of the Company on 18th July, 2012 on account of his pre- occupation and the Board appointed Mr. S.L.M. Chowdary Palempati to fill the casual vacancy created on account of the outgoing Director.
The Board wishes to place on record their earnest appreciation for the contributions made and the services rendered by Mr. Medasani Munisekhar during his valued association with the Company.
Furthermore Mr. S. L. M. Chowdary Palempati was appointed on the Board as an Additional Non- Executive Non- Independent Director w.e.f. 18th July, 2012 and holds office till the ensuing Annual General Meeting. A notice proposing the appointment of Mr. S. L. M. Chowdary Palempati under Section 257 of the Companies Act, 1956 as Director having been received, the matter is integrated in the Notice for the ensuing Annual General Meeting.
You are requested to accord your consent to his appointment on the Board of the Company.
None of the Directors except Mr. S. L. M. Chowdary Palempati is concerned or interested in the said resolution.
Directors retiring by Rotation
Pursuant to the provisions of Section 255 and Section 256 of the Companies Act, 1956 read with Article 113 of the Articles of Association of the Company, Mr. Rajaram Arjun Rambade and Mr. Surendra Naidu Rayapati, Directors of the Company are due to retire by rotation and being eligible, offer themselves for reappointment.
The Board wishes to place on record their appreciation for the services rendered by them as the Directors of the Company.
You are requested to accord your consent to his appointment on the Board of the Company.
None of the Directors except Mr. Rajaram Arjun Rambade and Mr. Surendra Naidu Rayapati, are concerned or interested in the said resolution.
Furthermore, Mr. Sharad Shah Tejshi, Director of the Company is due to retire by rotation at this Annual General Meeting is not seeking re-election and accordingly you are requested to accord your consent for relieving the said director from all the duties as a director of the Company.
The relations between the employees and the management, during the year, have been cordial. Various schemes have been implemented by the management to boost the employees to raise the benchmark creating a healthy competition within the organization.
CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO :
In view of the nature of activities undertaken by the Company, the disclosure under section 217(1) (e) read with Rules 2A, & 2B of the Companies (disclosure of particulars in the report of the Board of Directors) Rules, 1988, regarding
conservation of energy and technology absorption respectively, are not applicable to the Company.
Furthermore, the Company had no Foreign Exchange Earnings nor did it deal with any foreign exchange during the year.
HUMAN RESOURCE DEVELOPMENT
Your Company takes immense pride in the Commitment, Competence and Strength shown by its workforce in all realms of business. The Company continues to take new initiatives to further align its H. R. policies to meet the growing needs of its business.
Furthermore, Human Resource Development continues to be a key focus area at Secunderabad Healthcare Limited and thus the Company organizes regular training sessions for both the senior and junior management.
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to provisions of Section 217 (2AA) of the Companies Act, 1956, the Directors hereby state and confirm:
- That in the preparation of the Annual Accounts for the year ended 31st March, 2012, applicable accounting standards have been followed and no material departures have been made during the year under review.
- That they 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 financial year and of the Profit of the Company for the year.
- That they have taken 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.
- That they have prepared the Annual Accounts on a Going Concern basis.
It has always been the Company's attempt to excel through better Corporate Governance and fair and transparent practices, many of which have already been in place even before they were mandated by the law of the land.
Your Company continues to strive towards highest Standards of Corporate Governance. A report incorporating the Company's Structure on Corporate Governance is given in separate section titled "Report on Corporate Governance" forming part of this Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
A detailed review of Operations, Performance and Future Outlook pursuant to the requirements of Clause 49 of the Listing Agreement of the Company is given separately under the Section of "Management Discussion and Analysis Report" which forms part of the Annual Report.
Your Directors place on record their gratitude to the State Governments and the Company's Bankers for the assistance, support and encouragement extended by them to the Company. They also wish to place on record their gratitude for the enduring support and generous efforts of the Investors, Dealers, Business Associates and Employees in ensuring an excellent all round operational performance of the Company.
By Order of the Board
Date: 1st September, 2012 Sd/-
Place: Hyderabad Managing Director
Mar 31, 2011
The Directors have the pleasure in presenting their Twentieth Annual Report together with the Audited Accounts of the Company for the year ended 31st March, 2011.
This year the Company completed its nineteenth year of operations. Market conditions have been challenging. However your Company has always been working through this demanding situation to ensure that the viable products can move forward. In some cases we have been successful and in some, we have not been able to achieve the desired success as expected.
However in order to ensure that the Company's growth is not hindered, it is venturing into new lines of businesses in addition to the present business activities undertaken by it. The Management of the Company is hopeful that the efforts undertaken by them would meet with the desired level of success in the years to come
The financial performance of the Company, for the year ended March 31, 2011 is summarised below:
(Rs in lakhs)
Particulars 2010-2011 2009-2010 Amount Amount
Income 5894.13 2011.30
Profit before tax 25.31 25.88
Provision for tax 5.10 4.05
Profit After tax 20.21 21.84
- RESULTS OF DEERAIIQNS:
During the year under the review i.e. March 31, 2011 the Company has achieved a total income aggregating to Rs. 5894.13 lacs as compared to Rs. 2011.30 lacs in the previous financial year ended March 31, 2010, an increase of 200% as compared to the previous year. This achievement is a result of extensive efforts put in by the management for growing revenue, improving gross margins and generating efficiencies through increased productivity and leveraging scale.
Further the company posted a net profit of Rs. 25.31 lacs for the financial year ended March 31, 2011 which is slightly less as compared to that earned during the year ended March 31,2011. The decrease on the amount of Net Profit can be attributed to the mounting direct expenses incurred by Company. Further after making the necessary provisions for tax, the Company's net profit stands at Rs. 20.21 Lacs.
With the anticipated revival of the economy, your Directors are hopeful of better performance in the future years.
Your Board of Directors proposes to diversify the activities of the Company with a view to broad basing its activities and making it more resilient. In view of the bright prospects and with the rich experience of the senior executives of the Company, the Company feels that it can conveniently venture into business of Investment Company, its allied activities and other areas more elaborately described in the explanatory statement given in notice, which are to be read independently.
The Company is empowered by the existing object clause 1 & 4 in the Memorandum of Association trade and deal in chemicals and alkalis (whether by wholesale or retail) and which would include
all kinds of drugs, chemical, acids, medical and chemical preparation. The Board is satisfied that the proposed business can be undertaken conveniently and advantageously with the existing business of the Company.
Your Directors do not recommend Dividend for the year ended March 31, 2011 with a view to conserve the financial resources of the Company.
During the year, Mr. Vasudev Reddy Guda resigned from the directorship of the Company with effect from September 1, 2010 and his resignation was accepted by the Board of directors with immediate effect. Further the Board appointed Mr. Vinay Ganu as the Executive Director of the Company on 14th October, 2011.
The Board wishes to place on record its appreciation for the valuable contribution rendered by Mr. Vasudev Reddy Guda during his long association with the Company.
Further Mr. Medasani Munisekhar & Mr. Thakur Ramesh Singh Chouhan , Directors of the company, are due for retirement by rotation and are eligible for re-appointment. Also, Mr. Amit Shah , Mr. Jigar Motta & Mr. Vinay Madhukar Ganu are appointed during the year under section 260 of the companies act, 1956, as the Additional directors of the company.
Your Directors commends their re- appointment as the Directors of the Company.
Your Company has at a unified and centralized level, put in place a Corporate Social Responsibility (CSR) policy which is based on a belief that a Business cannot succeed in a society that fails and therefore it is imperative for business houses, to invest in the future by taking part in social-building activities.
Corporate Social Responsibility (CSR, also called corporate conscience, corporate citizenship, social performance, or sustainable responsible business) is a form of corporate self regulation integrated into a business model. CSR is the deliberate inclusion of public interest into corporate decision-making that is the core business of the company or firm, and the honouring of a triple bottom line: people, planet, profit. The goal of CSR is to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere.
The Company does not have any subsidiary Company within the meaning of section 4 of the Companies Act, 1956. Thus furnishing of the statement pursuant to the provisions of Section 212 of the Companies Act, 1956 is not required
- DISCLOSURE OF CHANGES IN THE CAPITAL STRUCTURE-
During the year under review, 4,00,96,000 Equity Shares were issued in lieu of the Convertible Equity shares on 2nd March, 2011 by the Company consequent to the payment of entire consideration and upon exercise of the option of conversion by the allotters.
Consequent to the afore-said issue of shares, the paid- up share capital of the Company stands at Rs 43,85,56,000 divided into 4,38,55,600 Equity Shares of Rs. 10/- each. Further the conversion of 3,99,04,000 Warrants is pending as on date.
Post conversion the paid- up share capital of the company would stand at Rs. 83,75,96,000 divided into 8,37,59,600 equity shares of Rs. 10/- each.
- PUBLIC DEPOSITS AND LOANS/ADVANCES:
During the year under review, your Company has not invited or accepted any deposits from the public pursuant to the provisions of Section 58A of the Companies Act, 1956; and therefore, no amount of principal or interest was outstanding in respect of deposits from the public as of the date of Balance Sheet.
MANAGEMENT, DISCUSSION A ANALYSIS;
As required by Clause 49 of the Listing Agreement with the Stock Exchanges, the Management Discussion & Analysis is given separately and forms part of this Annual Report.
- CORPORATE GOVERNANCE:
Pursuant to clause 49 of the Listing Agreement, Corporate Governance Report forms part of the Annual Report along with the compliance certificate on the conditions laid down in clause 49 of the Listing Agreement.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 217f2AA) of the Companies Act. 1956. with respect to Directors' Responsibility Statement it is hereby confirmed that:
(i) In the preparation of the annual accounts for the year ended March 31,2011, the applicable accounting standards read with requirements set out under Schedule VI of the Companies Act, 1956, have been followed and there are no material departures from the same;
(ii) The Directors have selected such accounting 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 as at March 31,2011 and of the profit of the Company for the year ended on that date;
(iii) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and
(iv) The Directors have prepared the annual accounts of the Company on a 'going concern' basis.
M/s. D. P. Agarwal & Co. retires at the ensuing Annual General Meeting and are eligible for re- appointment.
As required under the provisions of section 224(1B)of the Companies Act, 1956, the Company has obtained a written certificate from the Auditors to the effect that their re-appointment, if made, would be in conformity with the limits specified in the said section.
Your Directors request you to appoint Auditors for the current financial year and fix their remuneration
- AUDITORS REPORT:
The Auditors' Report to the shareholders on the Accounts of the Company for the financial year ended March 31, 2011 does not contain any qualification.
Further the observations furnished by the Auditors in their report are self-explanatory and do not call for any further comments.
- CONSERVATION OF ENERGX, TECHNOLOGY, ABSORPTION , FOREIGN EX- CHANGE EARNINGS. ANR OUTGO;
In view of the nature of the activities which are being carried on by the company, Rules 2A & 2B of the companies (disclosure of particulars in the report of the Board Of Directors) Rules, 1988, concerning conservation of energy and technology absorption respectively , are not applicable to the company.
During the year under review, the company had no foreign exchange earnings. The company has not spent any foreign exchange on any account.
- PARTICULARS OF,EMPLOYEES:
There are no employees who are in receipt of emoluments in excess of the limits prescribed under section 2t7(2A) of the companies act, 1956 during the year ended 31st March, 2011.
The Bombay Stock Exchange Limited
P J towers, 25th Floor,
Mumbai- 400 001
Your Directors wish to place on record their appreciation for the continued support and co-operation by Financial Institutions, Banks, Government authorities and other stakeholders. Your Directors also acknowledge the support extended by the Company's Unions and all the employees for their dedicated service. Your Directors would also like to thank you for the support and faith you have shown in us, and look forward to a fruitful relationship in the years to come.
Your Directors also thank the Members of the Board for their insight and guidance and for their contribution in the success of the Company. Your Directors also place on record their deep sense of appreciation for the services rendered by the employees of the Company.
For and on Behalf of the Board of Directors
For Secunderabad Healthcare Limited
Solomen Deneii Bondugula
Place: Hyderabad (Chairman)
Date : 1st September, 2011
Mar 31, 2010
The Directors have a pleasure in presenting the 19th Annual Report together with the Audited State- ment of Accounts for the Financial year ended 31 st March, 2010.
FINANCIAL RESULTS: (Rs. In Lakhs)
Particulars Year ended 31.03.2010 Year ended 31.03.2009
Turnover 1843.27 1592.24
Profit before Tax (+) / Loss (-) 25.88 43.06
Provision for Tax 4.05 4.79
Profit After Tax (+)/Loss (-) 21.85 38.26
Balance Brought Forward 166.01 174.33
Your Company achieved a turnover of Rs, 1843.27 Lacs as compared to Rs. 1592.24 Lacs in 2008-09 and the net profit after tax stood at Rs. 21.85 Lacs compared to Rs 38.26 Lacs in the previous year. Even though the Company registered a growth of 15.75% in the turnover for the current financial year under review, there is decline in the net profit after tax of the Company. This is due to increase in purchases amounting to Rs. 18,39,69,902. Such an increase is of 38.98% as compared to the previous accounting year.
The Company is committed to continue its efforts for the developmental activities and has several plans to sustain and improve the turnover and profitability in the future.
The year 2009 presented a lot of uncertainties and grave challenges for the Indian economy because of the financial and economic crisis that struck the world. But to the delight of the countrymen, India emerged from this crisis after having weathered against all odds only to usher in an era of sound economic situation aiming for a consistent 9% growth. The aim of the government outlined in the budget 2010-11 is to achieve inclusive growth by bringing the rural masses within the ambit of the development agenda.
The health infrastructure across Indian states is projected to grow by an average of 5.8 percent per annum between 2009-2013, taking the total expenditure in 2013 to USD 14.2 billion as suggested by the Indian Healthcare edition of KPMGs trend monitor. The report states that the Indian healthcare industry is estimated to double in value by 2012 and more than quadruple by 2017. The main factors propelling this growth are rising income levels, changing demographics and illness profiles, with a shift from chronic to lifestyle diseases. This is likely to result in considerable infrastructure challenges and opportunities.
Financial Budget for 2010-11 is encouraging in terms of increase in planned allocation for the Ministry of Health and Family Welfare from Rs. 19,534 crore in 2009-10 to Rs.22,300 crore in 2010-11 and reduction in customs duty on all medical, surgical, dental and veterinary equipment (including parts and accessories) from 7.5% to 5%. These goods are also being exempted from special CVD. The basic custom duty is exempted on specified inputs used for the manufacture of orthopedic implants.
Strengthening food security, improving education opportunities and providing health facilities at the level of households, both in rural and urban areas are sine-qua-none for inclusive growth to which the government and policy makers have attached utmost significance and priority. The financial year 2010- 11 marks the beginning of reverting to a high growth rate and moving towards greater fiscal consolida- tion and economic vibrance. This is going to be a new beginning for all the sectors of the economy and thus there is new hope and optimism for each of them. Last few years have seen consistent growth in the Indian healthcare sector, which has a promising future. And it is expected that the reform propos- als enshrined in the budget would help in accelerating and sustaining the growth path in the industry. Undoubtedly healthcare sector would help India become a global giant over the next decade.
Keeping in view the Companys need for Capital for its various growth plans and the with the intent to finance such plans through internal accruals to the maximum your Directors are of the opinion that it is prudent that no dividend be declared for the year under review
ALLOTMENT OF SHARES PURSUANT TO CONVERSION OF WARRANTS:
The Company had issued Share Warrants to a tune of 175000 Share warrants to the promoters and 200000 Share warrants to non promoters, at a price of Rs. 100/- per warrant that are convertible into Equity Shares, as determined in accordance with the relevant SEBI (DIP) Guidelines, 2000. Such War- rants are convertible at the option of the Warrant holders within an aggregate time frame of 18 months from date of its allotment to the Warrant holders into 375000 Equity Shares at a price of Rs. 100/- per share as determined in accordance with the relevant SEBI (DIP) Guidelines, 2000.
Upon receipt of the balance consideration for the same, the Board has allotted 2,00,000 Equity Share, in its meeting held on 15th June 2009 upon conversion of the Warrants in to Equity shares. The Com- pany has made the necessary application for listing of these shares with the Bombay Stock Exchange Limited.
- Conservation of Energy: The Company is monitoring the consumption of energy and is identifying measures for conservation of energy.
- Technology Absorption, adaptation and innovation: No technology either indigenous or Foreign is involved.
- Research and Development (R & D): The Company is taking steps to get Research and Development work carried out.
- Foreign exchange earnings: NIL
- Foreign exchange out go : NIL
PARTICULARS OF EMPLOYEES:
In pursuance of the provisions of section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules 1975, the Directors report that no employee who was in receipt of remuneration of Rs.24, 00,000/- or more per annum or Rs. 2,00,000/- or more per month, where employed for a part of the year.
Thus furnishing of particulars under the Companies (particulars of employees) Rules 1975 does not arise.
Mr. Sharad Tejshi Shah & Mr. R. Surendra Naidu, Directors, retire by rotation at the ensuing Annual General Meeting of the Company and being eligible offers himself for re-appoint- ment.
Mr. Rajaram Arjun Rambade, Additional Director of the Company, is been proposed to be ap- pointed as a Director liable to retire by rotation upon the notice received in writing from a Member of the Company along with a deposit of Rs. 500/- signifying his intention to propose the said director as candidate for the Office of Directors.
The Company has an Audit Committee duly constituted as per the provisions of Sec 292A of the Companies Act, 1956 and Clause 49 of the Listing Agreement and the said Committee has also com- plied with all the Legal and Statutory requirements.
AUDITORS AND AUDITORS REPORT:
M/s. A. Singhai & Co., are appointed as Statutory Auditors of the Company in place of M/s. P. Mu- rali & Co Chartered Accountants to hold office from the conclusion of the ensuing Annual General Meeting upto the conclusion of the next Annual General Meeting.
The Company has received letters from the Auditors to the effect that their appointment, if made, would be within the prescribed limits under section 224(1B) of the Companies Act, 1956 and that they are not disqualified for such re appointment within the meaning of section 226 of the said act.
The notes on accounts referred to in the Auditors Report are self-explanatory and therefore do not call for any further comments.
DIRECTORS RESPONSIBILITY STATEMENT UNDER SECTION 217r2AA):
As required under Section 217(2AA) of the Companies Act, 1956 which was introduced by the Companies (Amendment) Act, 2000, your Directors confirm that:
- In the preparation of the Annual Accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;
- 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 the period;
- The Directors had taken proper and sufficient care for the maintenance of adequate ac counting records in accordance with the provisions of the Act, 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.
STATEMENT PURSUANT TO CLAUSE 38 OF LISTING AGREEMENT:
Presently the Companys Equity shares are listed on and Bombay Stock Exchange Limited (BSE) and the Company have paid the Annual Listing Fees for the year 2010-11.
The Securities and Exchange Board of India (SEBI) has prescribed certain corporate governance stan- dards vide clause 49 of the Listing Agreement. Your directors reaffirm their commitment to these standards and a detailed report on corporate governance together with a Auditors certificate on its compliance is annexed hereto and forms part of this Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Managements Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section form- ing part of the Annual Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company maintains appropriate systems of internal control, including monitoring procedures and MIS system that define roles and responsibilities of people across various levels of the organization to ensure that all assets are safeguarded against loss from unauthorized use or disposition. Company poli- cies, guidelines and procedures are in place to ensure that all transactions are authorized and recorded correctly as well as to provide for adequate checks and balances.
Audits are finalized and conducted based on internal risk assessment. Significant deviations are brought to the notice of the Audit Committee by the Board periodically and corrective are measures recommended for implementation. All these steps facilitate timely detection of any irregularities and early remedial measures.
Your Company firmly believes that a dedicated workforce constitutes the primary source of sustain- able competitive advantage. Accordingly, human resource development continues to receive focused attention. Your Directors wish to place on record their appreciation of the dedicated and commendable services rendered by the staff and workforce of the Company.
The Company has not accepted any deposits during the year pursuant to the provisions of Section 58A of the Companies Act, 1956.
Your Directors commend the contribution made by the employees to the continued satisfactory busi- ness performance during the year and the ongoing management support received by the Company. The Directors place on record their appreciation to all stakeholders particularly Shareholders, Cus- tomers, Suppliers, various Central and State Government Agencies and Local Authorities, the Medi- cal Community and business partners, who have contributed to the Companys continued support. The Directors also place on record the continued management support received by the Company in the areas of Health, Safety and Environment and in terms of product and process know- how.
For and on behalf of the Board
Place: Hyderabad (M.Munisekhar) (Daniel Soloman)
Date: 12th August, 2010 Managing Director Executive Director