Mar 31, 2023
Your Directors are pleased to present Twenty Ninth Annual Report on the business and operations of the Company, along with the Standalone & Consolidated Audited Financial Statements of the Company for the Financial Year ended on March 31, 2023.
The Financial Statements of the Company have been prepared in accordance with the Indian Accounting Standards ("Ind AS") notified under section 133 of The Companies Act, 2013 ("the Act"), read with Rule 7 of The Companies (Accounts) Rules, 2014 ("the Accounts Rules").
The standalone and consolidated financial performance of the Company, for the Financial Year ended on March 31, 2023 are summarized below:
''in Lakhs |
||||
Particulars |
Standalone |
Consolidated |
||
For the year ended on March 31, 2023 |
For the year ended on March 31, 2022 |
For the year ended on March 31, 2023 |
For the year ended on March 31, 2022 |
|
Revenue from Operations and other Income |
26,500 |
23,165 |
2,25,965 |
2,01,950 |
Profit before Interest, Depreciation, Amortization and Impairment expenses, exceptional item and tax |
5,183 |
1,008 |
34,201 |
35,515 |
Less: Finance Costs |
114 |
202 |
1,608 |
2,551 |
Less: Depreciation and amortization expenses |
352 |
284 |
2,502 |
2,362 |
Profit before exceptional item and tax |
4,717 |
522 |
30,091 |
30,602 |
Exceptional Items |
- |
- |
1,005 |
- |
Profit Before Tax (PBT) |
4,717 |
522 |
29,086 |
30,602 |
Less: Tax Expenses (Credited) |
(1,925) |
(748) |
(1,951) |
(285) |
Profit After Tax (PAT) |
6,642 |
1,270 |
31,037 |
30,887 |
Attributable to: |
||||
Owners of the Parent |
6,642 |
1,270 |
31,037 |
30,887 |
Other Comprehensive Income/(Loss) (net of tax) |
(50) |
1 |
7 |
(81) |
Total Comprehensive Income |
6,592 |
1,271 |
31,044 |
30,806 |
Attributable to: |
||||
Owners of the Parent |
6,592 |
1,271 |
31,044 |
30,806 |
Opening balance in Retained Earnings |
35,454 |
37365 |
1,19,813 |
92,209 |
Amount available for appropriation |
42,046 |
38,636 |
1,50,845 |
1,22,995 |
Less: |
||||
Dividend |
(3,182) |
(3,182) |
(3,182) |
(3,182) |
Closing Balance in Retained Earnings |
38,864 |
35,454 |
1,47,663 |
1,19,813 |
Earnings Per Share (EPS) (Face Value of shares of '' 10/- each) |
||||
Basic (?) - After exceptional items |
10.44 |
2.00 |
48.78 |
48.54 |
Basic (?) - Before exceptional items |
10.44 |
2.00 |
50.36 |
48.54 |
Diluted (?) - After exceptional items |
1044 |
2.00 |
48.78 |
48.54 |
Diluted (?) - Before exceptional items |
1044 |
2.00 |
50.36 |
48.54 |
During the year under review, the consolidated revenue from operations grew by 12.2% to '' 2,25,479 Lakhs (Rupees Two Lakhs Twenty Five Thousand Four Hundred Seventy Nine Lakhs only) from '' 2,00,910 Lakhs (Rupees Two Lakhs Nine Hundred Ten Lakhs only) in 2021-2022. The profit before tax decreased by 5.0% y-o-y to '' 29,086 Lakhs (Rupees Twenty Nine Thousand Eighty Six Lakhs only). Net profit after tax (before OCI) increased by 0.5% y-o-y to '' 31,037 Lakhs (Rupees Thirty One Thousand Thirty Seven Lakhs only). The Net Profit margin, as a % (Percentage) to total operating income during the current year is 13.8%. A detailed analysis of performance for the year has been included in the Management Discussion and Analysis Report, forming part of the Annual Report.
During the year under review, the standalone revenue from operations and other income was '' 26,500 Lakhs (Rupees Twenty Six Thousand Five Hundred Lakhs only). The Company has incurred standalone Profit Before Tax of '' 4,717 Lakhs (Rupees Four Thousand Seven Hundred Seventeen Lakhs only) and Profit after Tax of '' 6,642 Lakhs (Rupees Six Thousand Six Hundred Forty Two Lakhs only). The EPS on standalone financials for the year ended on March 31, 2023 was '' 10.44 (Rupees Ten and Forty Four paisa only).
During the year under review, your Directors have recommended a final dividend of '' 5/- (Rupees Five only) (50.0%) per equity share on 6,36,32,144 Equity Shares of '' 10/- (Rupees Ten only) each fully paid-up for the Financial Year ended on March 31, 2023, amounting to '' 3,182 Lakhs (Rupees Three Thousand One Hundred Eighty Two Lakhs only). The dividend, if declared by the members at the ensuing Annual General Meeting ("AGM"), will be paid to those Members whose names stands registered in the Register of Members on Friday, July 21, 2023 i.e. the Record Date. In respect of shares held in dematerialized form, it will be paid to the Members whose names are furnished by the National Securities Depository Limited and the Central Depository Services (India) Limited, as beneficial owners. The Dividend Payout Ratio for the Financial Year ended on March 31, 2023 is 10.3% of consolidated profits after tax.
In compliance of regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations") the Company has formulated Dividend Distribution Policy, which is approved by the Board of Directors ("the Board") and is uploaded on the website of the Company and the weblink of the same is provided in a separate section in Corporate Governance Report.
The Company has 5 (five) wholly owned subsidiary companies viz. Zydus Wellness Products Limited ("ZWPL"), Liva Nutritions Limited, Liva Investment Limited, Zydus Wellness International DMCC, Dubai and Zydus Wellness (BD) Pvt. Limited, Bangladesh.
There has been no material change in the nature of business of the Company as well as subsidiary companies. More details are provided in the Audited Financial Statements. During the year under review, the Board has reviewed the performance / affairs of the subsidiary companies.
Further, in compliance of the provisions of regulation 16(1)(c) of the Listing Regulations, the Company has formed a policy relating to material subsidiaries, which is approved by the Board and the weblink of the same is provided in a separate section in Corporate Governance Report.
Further, as provided in section 136 of the Act, the Audited Financial Statements of the subsidiary companies are not being attached with the Financial Statements of the Company. The Company will make available free of cost the Audited
Financial Statements of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The Financial Statements of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Consolidated Financial Statements presented by the Company includes Financial Results of its subsidiary companies.
As provided under section 129(3) of the Act and Rules made thereunder a statement containing the salient features of the Financial Statements of its subsidiaries in the format prescribed under the rules is attached to the Financial Statements.
Transfer of Shares and Dividend to Investor Education and Protection Fund (âIEPFâ):
From April 1, 2022 to May 17 2023, in compliance with the provisions of sections 124 and 125 of the Act and Rules made thereunder, the Company has transferred-
i. 9,901 (Nine Thousand Nine Hundred One) equity shares of '' 10/- (Rupees Ten only) each of 204 (Two Hundred Four) members whose dividend has remained unclaimed / unpaid for a consecutive period of 7 (seven) years to the demat account of IEPF after giving notice to the members and advertisement in newspaper to claim their shares and
ii. '' 18,69,125 (Rupees Eighteen Lakhs Sixty Nine Thousand One Hundred Twenty Five only) held by 6,109 (Six Thousand One Hundred Nine) members, being the unclaimed dividend for the Financial Years ended on March 31, 2015 and March 31, 2016 to IEPF after giving three notices to the members to claim their unpaid / unclaimed dividend.
The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the end of the Financial Year.
The Companyâs property, plants and equipments and inventories are adequately insured against all major risks. The Parent Company has taken Directorsâ and Officersâ Liability Policy to provide coverage against the liabilities arising on them, which also includes the Directors of the Company.
Management Discussion and Analysis (âMDAâ):
MDA, for the year under review, as stipulated under the Listing Regulations, is provided in a separate section, which forms part of the Annual Report.
Consolidated Financial Statements:
In accordance with the Ind AS-110 on Consolidation of Financial Statements and as provided under the provisions of the Act read with Schedule III of the Act and Rules made thereunder and the Listing Regulations, the Audited Consolidated
Financial Statements are provided in the Annual Report, which shows the financial resources, assets, liabilities, income, profits and other details of the Company and its wholly subsidiary companies, as a single entity.
Related Party Transactions:
All transactions entered by the Company during the Financial Year ended on March 31, 2023 with related parties were in the ordinary course of business and on an armâs length basis. All related party transactions were placed before the Audit Committee for review and approval.
The weblink of the Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board is provided in a separate section in Corporate Governance Report.
As provided under section 134(3)(h) of the Act and Rules made thereunder, disclosure of particulars of material transactions (i.e. transactions exceeding '' 1,000 Crore (Rupees One Thousand Crore only) or 10% (ten percent) of the annual consolidated turnover as per the last Audited Financial Statements with related parties entered into by the Company in the prescribed format in Form No. AOC-2 is attached herewith as Annexure-âAâ. Disclosures on related party transactions are set out in Note No. 37 of the Standalone Audited Financial Statements.
Particulars of Loans, Guarantees and Investments:
Details of loans, guarantees and investments covered under section 186 of the Act are given in the notes to the Financial Statements.
Directors and Key Managerial Personnel:
i. Retirement by rotation:
I n accordance with the provisions of section 152(6) of the Act and in terms of the Articles of Association of the Company, Dr. Sharvil P. Patel (DIN: 00131995) will retire by rotation at the ensuing AGM and being eligible, offers himself for re-appointment. The Board recommends his re-appointment.
ii. Appointment of Mr. Akhil A. Monappa (DIN: 09784366) as an Independent Director (âIDâ) of the Company:
Based on the recommendation of Nomination and Remuneration Committee ("NRC"), the Board at its meeting held on May 17 2023 approved appointment of Mr. Akhil A. Monappa (DIN: 09784366) as an Additional Director (Independent) of the Company with effect from May 17 2023 till the conclusion of the ensuing AGM. The Board of the Company has recommended his appointment as an ID for the first term of 5 (five) consecutive years effective from May 17 2023 till May 16, 2028, which shall be subject to the approval of the members by way of Special Resolution at the ensuing AGM. In the opinion of the Board, he possesses requisite expertise, integrity and experience (including proficiency) for appointment as an ID of the Company.
iii. Re-appointment of Ms. Dharmishtaben N. Raval (DIN: 02792246) and Mr. Srivishnu R. Nandyala (DIN: 00025063), as the IDs of the Company:
Ms. Dharmishtaben N. Raval and Mr. Srivishnu R. Nandyala were appointed as the IDs of the Company by the members on July 31, 2019 for the first term of 5 (five) consecutive years effective from March 11, 2019 upto March 10, 2024.
The Board of the Company, based on the recommendation of NRC, evaluation of the balance of skills, knowledge and experience on the Board and further, on the report of performance evaluation and subject to approval of members at the ensuing AGM, by way of special resolution, has recommended the re-appointment of Ms. Dharmishtaben N. Raval and Mr. Srivishnu R. Nandyala as the IDs of the Company, to hold office for the second term of 5 (five) consecutive years on the Board of the Company w.e.f. March 11, 2024 upto March 10, 2029.
In the opinion of the Board, they possesses requisite expertise, integrity and experience (including proficiency) for appointment as the IDs of the Company.
iv. Declaration of Independence:
The Company has received declaration of independence as stipulated under sections 149(6) and 149(7) of the Act and regulations 16(1)(b) and 25 of the Listing Regulations from IDs confirming that they are not disqualified for continuing as an ID. There has been no change in the circumstances affecting their status as an ID of the Company.
All the Directors of the Company, who are required to get registered, have registered themselves with The Indian Institute of Corporate Affairs. Further, as per the declarations received, none of the Directors of the Company are required to give online proficiency test, except one ID (who shall comply with the provisions within the prescribed time frame), as per the first proviso to rule 6(4) of The Companies (Appointment and Qualification of Directors) Rules, 2014, as amended from time to time.
v. Profile of Directors seeking appointment / re-appointment:
As required under regulation 36(3) of the Listing Regulations and standard 1.2.5 of Secretarial Standard-2 on General Meetings issued by The Institute of Company Secretaries of India, a brief resume of the Directors seeking appointment / re-appointment at the ensuing AGM, the nature of expertise in specific functional areas, names of companies in which they hold directorships, committee memberships / chairpersonships, their shareholding in the Company, etc. have been furnished in the explanatory statement to the notice convening Twenty Ninth AGM.
vi. Key Managerial Personnel (âKMPâ):
Based on the recommendation of NRC, the Board at their meeting held on July 29, 2022, appointed Mr. Nandish P Joshi as the Company Secretary and Compliance Officer and designated as Whole-time Key Managerial Personnel of the Company effective from July 29, 2022 in place of Mr. Dhanraj P Dagar who ceased as the Company Secretary and Compliance Officer of the Company w.e.f. May 9, 2022.
The following persons are the KMP as on March 31, 2023:
1. Mr. Tarun Arora, Chief Executive Officer ("CEO") and Whole Time Director,
2. Mr. Umesh V. Parikh, Chief Financial Officer and
3. Mr. Nandish P Joshi, Company Secretary and Compliance Officer (w.e.f. July 29, 2022).
vii. Board Evaluation:
Pursuant to the provisions of the Act and the Rules made thereunder and as provided under Schedule IV of the Act and the Listing Regulations, the NRC / Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of its committees. The manner in which the evaluation was carried out is provided in the Corporate Governance Report, which forms a part of the Annual Report.
In a separate meeting of IDs, the performance of the Non-Independent directors, the Board as a whole and the Chairman of the Company was evaluated, taking into account the views of Executive directors and Non-Executive directors.
The Board and the NRC reviewed the performance of individual directors on the basis of criteria fixed by the Board / NRC.
The functioning of the Board, the Committees and performance of individual Directors was found satisfactory.
viii. Nomination and Remuneration Policy:
The Board has on the recommendation of the NRC, framed a Policy on selection and appointment of Director(s), Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report, which forms a part of the Annual Report and the weblink of the same is also provided in a separate section in Corporate Governance Report.
ix. Pecuniary relationship:
During the year under review, except those disclosed in the Audited Financial Statements, the Non-Executive Directors of the Company had no pecuniary relationship or transactions with the Company.
The Company has adopted the Code for prevention of Insider Trading as per the SEBI (Prohibition of Insider Trading) Regulations, 2015. Other details on insider trading regulations are provided in the Corporate Governance Report, which forms a part of the Annual Report.
Directorsâ Responsibility Statement:
In terms of sections 134(3)(c) and 134(5) of the Act and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:
i. that in preparation of the Financial Statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
ii. that such accounting policies have been selected and applied consistently and judgments and estimates made 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, 2023 and of the profit of the Company for the year ended on that date,
iii. that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities,
iv. that the Financial Statements have been prepared on a going concern basis,
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively, and
vi. that the systems to ensure compliance with the provisions of all applicable laws were in place and adequate and operating effectively.
4 (four) Board meetings were held during the Financial Year ended on March 31, 2023. The Board approved 3 (three) resolutions by circulation, on May 9, 2022, December 13, 2022 and March 31, 2023 respectively. Other information with regard to the Board meetings is given in the Corporate Governance Report, which forms a part of the Annual Report.
As provided in section 177(8) of the Act, the information about composition of Audit Committee and other details are given in the Corporate Governance Report, which forms a part of the Annual Report.
Recommendations of Committees:
The Board has accepted all the recommendations of the Committees of the Board.
Composition of other Committees:
Composition of other Committees and other details of the Committees are given in the Corporate Governance Report, which forms a part of the Annual Report.
The Company has complied with the Corporate Governance requirements under the Act and as stipulated under the Listing Regulations. A separate section on detailed report on the Corporate Governance practices followed by the Company under the Listing Regulations along with a certificate from Hitesh Buch & Associates, Practicing Company Secretaries, confirming the compliance, forms a part of the Annual Report.
i. Statutory Auditors and their Report:
Mukesh M. Shah & Co, Chartered Accountants, (Firm Registration No. 106625W) were appointed as Statutory Auditors from the conclusion of Twenty Sixth AGM of the Company till the conclusion of Thirty First AGM of the Company. They have furnished a declaration confirming their independence as well as their armâs length relationship with the Company and that they have not taken up any prohibited non-audit assignments for the Company.
The Board has duly reviewed the Statutory Audit Report for the Financial Year ended on March 31, 2023 and the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in their Report as provided under section 134(3)(f) of the Act.
The Company has received the consent and eligibility certificate from the said Statutory Auditors as required under the Act.
ii. Cost Auditors:
Pursuant to the provisions of section 148(3) of the Act read with rule 4 of The Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, the cost records maintained by the Company in respect of its product âNutraliteâ are required to be audited. The Board has, on the recommendation of the Audit Committee, appointed Dalwadi & Associates, Cost Accountants (Firm Registration No. 000338) to audit the cost records of the Company for the Financial Year ending on March 31, 2024 at a remuneration of '' 3.21 Lakhs (Rupees Three Lakhs Twenty One Thousand only) plus applicable Goods and Services Tax and out of pocket expenses at actuals, if any.
As required under the Act and Rules made thereunder, the remuneration payable to the Cost Auditor is required to be placed before the Members at General Meeting for ratification. Accordingly, a resolution seeking ratification of the remuneration payable to Dalwadi & Associates, Cost Accountants, by the members is included at Item No. 8 of the Notice convening Twenty Ninth AGM.
iii. Secretarial Auditors and Secretarial Audit Report:
Pursuant to provisions of section 204 of the Act and rule 9 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board has appointed Hitesh Buch & Associates, Practicing Company Secretaries, to undertake Secretarial Audit of the Company for the Financial Year ended on March 31, 2023. The Secretarial Audit Report is attached herewith as Annexure-âBâ.
The Board has reviewed the Secretarial Audit Report and is of the opinion that the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in their Report as provided under section 134(3)(f) of the Act.
Further, as per regulation 24A(1) of the Listing Regulations, the Secretarial Audit Report of ZWPL, the material unlisted subsidiary company is attached herewith as Annexure-âB1â.
iv. Annual Secretarial Compliance Report:
Pursuant to regulation 24A(2) of the Listing Regulations, Hitesh Buch & Associates, Practicing Company Secretaries have issued Annual Secretarial Compliance Report for the Financial Year ended on March 31, 2023. The report was placed before the Board meeting held on May 17, 2023, which confirmed that the Company has maintained proper records as stipulated under various Rules and Regulations and that, no action has been taken against the Company or its material subsidiary or promoters / directors by The Securities Exchange Board of India / BSE Limited / National Stock Exchange of India Limited.
The Company has made and maintained the cost accounts and records as specified by the Central Government under section 148(1) of the Act and Rules made thereunder.
Compliance with Secretarial Standards:
During the year under review, the Company has complied with the applicable Secretarial Standards i.e. SS-1 and SS-2, relating to "Meetings of the Board of Directors" and "General Meetings", respectively, issued by The Institute of Company Secretaries of India.
Business Responsibility and Sustainability Report:
Pursuant to the provisions of regulation 34(2)(f) of the Listing Regulations, Business Responsibility and Sustainability Report forms a part of the Annual Report.
Corporate Social Responsibility (âCSRâ):
Pursuant to the provisions of section 135 of the Act and rule 5 of The Companies (Corporate Social Responsibility Policy) Rules, 2014 made thereunder, the Board has constituted a CSR and ESG Committee under the Chairmanship of
Dr. Sharvil P Patel. The other members of the Committee includes Mr. Ganesh N. Nayak and Mr. Savyasachi S. Sengupta. During the year under review, the nomenclature of the Committee was changed to "CSR and ESG Committee" and terms of reference of the Committee were amended to include the scope of ESG. A CSR Policy has been framed and adopted by the Board and the same is uploaded on the website of the Company.
As the average net profits of the company calculated as per section 198 of the Act was negative, no contribution towards CSR was required to be made for the Financial Year ended on March 31, 2023. Other details on CSR, as required under section 135 of the Act read with The Companies (Corporate Social Responsibility Policy) Rules, 2014, are given in the Annual Report on CSR Activities in Annexure-âCâ.
A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate them. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.
Pursuant to the provisions of section 134(3)(n) of the Act and regulation 21 of the Listing Regulations, the Company has constituted a Risk Management Committee under the Chairmanship of Dr. Sharvil P Patel. The other members of the Committee includes Mr. Savyasachi S. Sengupta, Independent Director, Mr. Kulin S. Lalbhai, Independent Director and Mr. Umesh V. Parikh, Chief Financial Officer. The details of the Committee and its terms of reference are set out in the Corporate Governance Report, which forms a part of the Annual Report.
Discussions on risks and concerns are covered in the MDA Report, which forms a part of the Annual Report.
Internal Financial Control and their adequacy:
The Company has designed and implemented a process driven framework for Internal Financial Controls ("IFC") within the meaning of the explanation to section 134(5)(e) of the Act. For the Financial Year ended on March 31, 2023, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implement new and / or improved controls whenever the effect of such gaps would have a material effect on the Companyâs operations.
Managing the risks of fraud, corruption and unethical business practices:
i. Vigil Mechanism / Whistle Blower Policy:
The Company has built a reputation for doing business with honesty and integrity and it has zero tolerance for any type of unethical behavior or wrongdoing. The Company has in place a stringent vigil mechanism to report unethical behavior in order to promote professionalism, fairness, dignity and ethical behavior in its employees.
In compliance with the provisions of section 177(9) of the Act and Rules made thereunder and regulation 22 of the Listing Regulations, the Company has established Vigil Mechanism and framed Whistle Blower Policy for Directors and employees, to report concerns about unethical behaviour, actual or suspected fraud or report instances of leakage of unpublished price sensitive information or violation of the Companyâs Code of Conduct or Ethics Policy and SEBI (Prohibition of Insider Trading) Regulations, 2015. Whistle Blower Policy is uploaded on the website of the Company and weblink of the same is provided in a separate section in Corporate Governance Report.
ii. Zydus Business Conduct Policy:
The Company has framed "Zydus Business Conduct Policy". Every employee is required to review and sign the policy at the time of joining and an undertaking has to be given for adherence to the Policy. The objective of the Policy is to conduct the business in an honest, transparent and ethical manner. The policy provides for anti-bribery and avoidance of other corruption practices by the employees of the Company.
Disclosure as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:
The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder. Also, the Company has complied with the provisions relating to the constitution of Internal Complaints Committee.
The Company always endeavors to create and provide conducive work environment that is free from discrimination and harassment including sexual harassment. The Company has in place a robust policy on prevention of sexual harassment at workplace. The policy aims at prevention of harassment of employees, temporaries, trainees, visitors, employees on contract or at client sites and lays down the guidelines for identification, reporting and prevention of sexual harassment.
During the Financial Year ended on March 31, 2023, the Company has not received any complaint of sexual harassment.
As per the provisions of section 92(3) read with section 134(3)(a) of the Act, the Annual Return for the Financial Year ended on March 31, 2023, in the prescribed Form No. MGT-7 is available on the website of the Company at https://www.zydusweUness.com/investor/Form%20MGT-7. pdf.
The information required under section 197 of the Act read with rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is attached herewith as Annexure-âDâ.
Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:
Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 134(3)(m) of the Act read with rule 8(3) of the Accounts Rules, is attached herewith as Annexure-âEâ.
Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134(3) of the Act read with rule 8(3) of the Accounts Rules, to the extent the transactions took place on those items during the Financial Year ended as on March 31, 2023.
Apart from what is mentioned in this report, there are no material changes and commitments affecting the financial position of the Company between the end of the Financial Year and the date of this report.
Your Directors place on record their sincere appreciation for the continued co-operation and support extended to the Company by the Banks. Your Directors also thank the Trade and Consumers for their patronage to the Companyâs products. Your Directors also place on record sincere appreciation of the continued hard work put in by the employees at all levels. Your Directors also thank the Companyâs Vendors, Investors, Business associates, Stock Exchanges, Government of India, State Governments and various departments and Statutory and Government agencies or bodies for their support and co-operation.
Mar 31, 2022
Your Directors are pleased to present Twenty Eighth Annual Report on the business and operations of the Company, along with the Standalone & Consolidated Audited Financial Statements of the Company for the Financial Year ended on March 31, 2022.
The Financial Statements of the Company have been prepared in accordance with the Indian Accounting Standards ("Ind AS") notified under section 133 of the Companies Act, 2013 ("the Act"), read with rule 7 of the Companies (Accounts) rules, 2014 ("the Accounts Rules").
The standalone and consolidated financial performance of the Company, for the Financial Year ended on March 31, 2022 are summarized below:
'' in Lakhs |
||||
Particulars |
Standalone |
Consolidated |
||
For the year ended on March 31, 2022 |
For the year ended on March 31, 2021 |
For the year ended on March 31, 2022 |
For the year ended on March 31, 2021 |
|
Total Income |
23,165 |
18,063 |
2,01,950 |
1,87561 |
Profit before Interest, Depreciation, Amortization and Impairment expenses, exceptional item and tax |
1,008 |
1,708 |
35,515 |
35,330 |
Less: Finance Costs |
202 |
7,466 |
2,551 |
8,380 |
Less: Depreciation and amortization expense |
284 |
349 |
2,362 |
2,516 |
Profit/(Loss) before exceptional item and tax (PBT) |
522 |
(6,107) |
30,602 |
24,434 |
Exceptional Items |
- |
(12,706) |
- |
(13,213) |
Profit/(Loss) before tax |
522 |
(18,813) |
30,602 |
11,221 |
Less: Tax Expenses |
(748) |
(599) |
(285) |
(652) |
Profit / (Loss) After Tax (PAT) |
1,270 |
(18,214) |
30,887 |
11,873 |
Attributable to: |
||||
Owners of the Parent |
1,270 |
(18,214) |
30,887 |
11,873 |
Other Comprehensive Income/(Loss) (net of tax) |
1 |
16 |
(81) |
183 |
Total Comprehensive Income |
1,271 |
(18,198) |
30,806 |
12,056 |
Attributable to: |
||||
Owners of the Parent |
1,271 |
(18,198) |
30,806 |
12,056 |
Opening balance in Retained Earnings |
37,365 |
18,063 |
92,209 |
42,642 |
Transfer from Debenture Redemption Reserve |
- |
37500 |
- |
37500 |
Amount available for appropriation |
||||
Less: |
||||
Dividend |
(3,182) |
- |
(3,182) |
- |
Closing Balance in Retained Earnings |
35,454 |
37,365 |
1,19,813 |
92,209 |
Earnings Per Share (EPS) (Face Value of shares of '' 10/- each) |
2 |
(29.99) |
48.54 |
19.55 |
During the year under review, the consolidated revenue from operations grew by 7.6% to '' 2,00,910 Lakhs from '' 1,86,667 Lakhs in 2020-21. The profit before tax increased by 172.7% y-o-y to '' 30,602 Lakhs. Net profit after tax (before OCI) increased by 160.1% y-o-y to '' 30,887 Lakhs. The Net Profit margin, as a % (Percentage) to total operating income during the current year is 15.4%. A detailed analysis of performance for the year has been included in the Management Discussion and Analysis Report, forming part of the Annual Report.
During the year under review, the standalone revenue from operations and other income was '' 23,165 Lakhs. The Company has incurred standalone Profit Before Tax of '' 522 Lakhs and Profit after Tax of '' 1,270 Lakhs. The EPS on standalone financials for the year ended on March 31, 2022 was '' 2/-.
During the year under review, your Directors have recommended a final dividend of '' 5/- (50.0%) per equity share on 6,36,32,144 Equity Shares of '' 10/- each fully paid-up for the Financial Year ended on March 31, 2022, amounting to '' 3,182 Lakhs. The dividend, if declared by the members at the ensuing Annual General Meeting ("AGM"), will be paid to those Members whose names stands registered in the Register of members on July 15, 2022 i.e. the Record Date. In respect of shares held in dematerialized form, it will be paid to the Members whose names are furnished by the National Securities Depository Limited and the Central Depository Services (India) Limited, as beneficial owners. The Dividend Payout Ratio for the Financial Year ended on March 31, 2022 is 10.3% of consolidated profits after tax.
To bring transparency in the matter of declaration of dividend and protect the interest of investors, the Company has in place a dividend distribution policy since long.
In terms of regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations"), the Company has formulated a Dividend Distribution Policy, which is approved by the Board of Directors ("the Board") and is uploaded on Companyâs website at https://www.zyduswettness.com/investor/Dividend_Poticy-May17.pdf.
The Company has 5 (five) wholly owned subsidiary companies viz. Zydus Wettness Products Limited ("ZWPL"), Liva Nutritions Limited, Liva Investment Limited, Zydus Wettness Internationat DMCC, Dubai and Zydus Wettness (BD) Pvt Limited, Bangtadesh.
During the year under review, ZWPL has incorporated a new company in the name of Zydus Wettness (BD) Pvt Limited, as a whotty owned subsidiary company in Bangtadesh.
There has been no materiat change in the nature of business of the Company as wett as subsidiary companies. More detaits are provided in the Audited Financiat Statements. During the year under review, the Board has reviewed the performance / affairs of the subsidiary companies.
Further, in comptiance of the provisions of regutation 16(1)(c) of the Listing Regutations, the Company has formed a poticy retating to materiat subsidiaries, which is approved by the Board and may be accessed on the Companyâs website at https://www.zyduswettness.com/investor/Poticy-on-Materiat-Subsidiary-Adopted.pdf.
Further, as provided in section 136 of the Act, the Audited Financiat Statements of the subsidiary companies are not being attached with the Financiat Statements of the Company. The Company witt make avaitabte free of cost the Audited Financiat Statements of the subsidiary companies and the retated detaited information to any member of the Company who may be interested in obtaining the same. The Financiat Statements of the subsidiary companies witt atso be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Consotidated Financiat Statements presented by the Company inctude financiat resutts of its subsidiary companies.
As provided under section 129(3) of the Act and rutes made thereunder a statement containing the satient features of the Financiat Statements of its subsidiaries in the format prescribed under the rutes is attached to the Financiat Statements.
Transfer of Shares and Dividend to Investor Education and Protection Fund (âIEPFâ):
In comptiance with the provisions of section 124 of the Act and rutes made thereunder, the Company has transferred-
i. 8,185 (Eight Thousand One Hundred Eighty Five) equity shares of 216 (Two Hundred Sixteen) members whose dividend has remained unctaimed / unpaid for a consecutive period of 7 (seven) years to IEPF.
ii. '' 9,96,486 (Rupees Nine Lakhs Ninety Six Thousand Four Hundred Eighty Six onty) hetd by 3,201 (Three Thousand Two Hundred One) members, being the unctaimed dividend for the Financiat Year ended on March 31, 2014 to IEPF after giving notices to the members to ctaim their unpaid / unctaimed dividend.
The Company has not accepted any fixed deposit and, as such, no amount of principat or interest was outstanding as of the Batance Sheet date.
The Companyâs plants, properties, equipments and stocks are adequately insured against all major risks. The Parent Company has taken Directorsâ and Officersâ Liability Policy to provide coverage against the liabilities arising on them, which includes the Directors of the Company also.
Management Discussion and Analysis (âMDAâ):
MDA, for the year under review, as stipulated under the Listing Regulations, is provided in a separate section, forming a part of the Annual Report.
Consolidated Financial Statements:
In accordance with the Ind AS-110 on Consolidation of Financial Statements and as provided under the provisions of the Act read with Schedule III of the Act and rules made thereunder and the Listing Regulations, the Audited Consolidated Financial Statements are provided in the Annual Report, which show the financial resources, assets, liabilities, income, profits and other details of the Company and its subsidiary companies after elimination of minority interest, as a single entity.
All transactions entered by the Company during the Financial Year ended on March 31, 2022 with related parties were in the ordinary course of business and on an armâs length basis. All related party transactions were placed before the Audit Committee for review and approval.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companyâs website at https://www.zyduswellness.com/investor/Policy-on-Related-Party-Transactions-March-2022.pdf.
Disclosures on related party transactions are set out in Note No. 37 to the Financial Statements.
Particulars of Loans, Guarantees and Investments:
Details of loans, guarantees and investments covered under section 186 of the Act are given in the notes to the Financial Statements.
Directors and Key Managerial Personnel:
i. Retirement by rotation:
I n accordance with the provisions of section 152(6) of the Act and in terms of the Articles of Association of the Company, Mr. Ganesh N. Nayak (DIN:00017481) will retire by rotation at the ensuing AGM and being eligible, offers himself for re-appointment. The Board recommends his re-appointment.
ii. Declaration of Independence:
The Company has received declaration of independence as stipulated under section 149(7) of the Act and
regulation 16(b) of the Listing Regulations, from Independent Directors ("IDs") confirming that they are not disqualified for continuing as an ID.
All the IDs of the Company have registered themselves with the Indian Institute of Corporate Affairs ("IICA").
iii. Profile of Director seeking re-appointment:
As required under regulation 36(3) of the Listing Regulations, particulars of Director seeking re-appointment at the ensuing AGM are annexed to the notice convening Twenty Eighth AGM.
iv. Key Managerial Personnel (âKMPâ):
Mr. Dhanraj P. Dagar, Company Secretary and Compliance Officer of the Company resigned w.e.f. the close of the business hours of May 9, 2022.
The following persons are the KMP:
1. Mr. Tarun Arora, Chief Executive Officer ("CEO") & Whole Time Director
2. Mr. Umesh V. Parikh, Chief Financial Officer and
3. Mr. Dhanraj P. Dagar, Company Secretary and Compliance Officer (till May 9, 2022).
v. Board Evaluation:
Pursuant to the provisions of the Act and the rules made thereunder and as provided under Schedule IV of the Act and the Listing Regulations, the Nomination and Remuneration Committee ("NRC") / Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of its committees. The manner in which the evaluation was carried out is provided in the Corporate Governance Report, forming a part of the Annual Report.
vi. Nomination and Remuneration Policy:
The Board has on the recommendations of the NRC, framed a Policy on selection and appointment of Director(s), Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report, forming part of the Annual Report and is uploaded on the Companyâs webiste at https://www.zyduswellness.com/investor/NRC-Policy-2021.pdf.
vii. Pecuniary relationship:
During the year under review, except those disclosed in the Audited Financial Statements, the non-executive directors of the Company had no pecuniary relationship or transactions with the Company.
The Company has adopted the Code for Insider Trading as per the SEBI (Prohibition of Insider Trading) Regulations, 2015.
Other details on insider trading regulations are provided in the Corporate Governance Report, forming a part of the Annual Report.
Directorsâ Responsibility Statement:
In terms of section 134(3)(c) and 134(5) of the Act and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:
i. that in preparation of the Financial Statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
ii. t hat such accounting policies have been selected and applied consistently and judgments and estimates made 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, 2022 and of the profit of the Company for the year ended on that date,
iii. that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities,
iv. that the Financial Statements have been prepared on a going concern basis,
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively, and
vi. that the systems to ensure compliance with the provisions of all applicable laws were in place and adequate and operating effectively.
Information of meetings of the Board of Directors is given in Corporate Governance Report, forming a part of the Annual Report.
As provided in section 177(8) of the Act, the information about composition of Audit Committee and other details are given in Corporate Governance Report, forming a part of the Annual Report.
Recommendations of Committees:
The Company has accepted all the recommendations of the Committees of the Board.
Composition of other Committees:
Composition of other Committees and other details on the Committees are given in the Corporate Governance Report, forming a part of the Annual Report.
The Company has complied with the Corporate Governance requirements under the Act and as stipulated under the Listing Regulations. A separate section on detailed report on the Corporate Governance practices followed by the Company under the Listing Regulations along with a certificate from a Practicing Company Secretary, confirming the compliance is forming a part of the Annual Report.
i. Statutory Auditors and their Report:
Mukesh M. Shah & Co, Chartered Accountants, (Firm Registration No. 106625W) were appointed as Statutory Auditors from the conclusion of Twenty Sixth AGM of the Company till the conclusion of Thirty First AGM of the Company. They have furnished a declaration confirming their independence as well as their armâs length relationship with the Company and that they have not taken up any prohibited non-audit assignments for the Company.
The Board has duly reviewed the Statutory Auditorâs Report for the Financial Year ended on March 31, 2022 and the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in their Report as provided under section 134 of the Act.
The Company has received the consent and eligibility certificate from the said Statutory Auditors as required under the Act.
ii. Cost Auditors:
Pursuant to the provisions of section 148(3) of the Act read with the Companies (Cost Records and Audit) Rules, 2014 as amended from time to time, the cost records maintained by the Company in respect of its product âNutraliteâ are required to be audited. The Board has, on the recommendation of Audit Committee, appointed Dalwadi & Associates, Cost Accountants (Firm Registration No. 000338) to audit the cost records of the Company for the Financial Year ending on March 31, 2023 at a remuneration of '' 3 Lakhs plus applicable Goods and Service Tax and out of pocket expenses at actuals.
As required under the Act and rules made thereunder, the remuneration payable to the Cost Auditors is required to be placed before the Members at General Meeting for ratification. Accordingly, a resolution seeking ratification of the remuneration payable to Dalwadi & Associates, Cost Accountants, by the members is included at Item No. 5 of the Notice convening Twenty Eighth AGM.
iii. Secretarial Auditors and Secretarial Audit Report:
Pursuant to provisions of section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed Hitesh Buch & Associates, Practicing Company Secretaries, to undertake Secretarial Audit of the Company for the Financial Year ended on March 31, 2022. The Secretarial Audit Report is attached herewith as Annexure-âAâ.
The Board has reviewed the Secretarial Auditorâs Report and is of the opinion that the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in its Report as provided under section 134 of the Act.
Further, as per regulation 24A(1) of the Listing Regulations, the Secretarial Audit Report of ZWPL, the material unlisted subsidiary company is attached herewith as Annexure-âA1â.
The Company is required to maintain the cost records as specified by the Central Government under sub-section (1) of section 148 of the Act and the rules made thereunder and accordingly such accounts and records are made and maintained.
Compliance with Secretarial Standards:
During the year under review, the Company has complied with the applicable Secretarial Standards i.e. SS-1 and SS-2, relating to "Meetings of the Board of Directors" and "General Meetings", respectively, issued by The Institute of Company Secretaries of India.
Business Responsibility Report:
As per regulation 34(2)(f) of the Listing Regulations, Business Responsibility Report is forming a part of the Annual Report.
Corporate Social Responsibility (âCSRâ):
Pursuant to the provisions of section 135 of the Act and rules made thereunder, the Board has constituted a CSR Committee under the Chairmanship of Dr. Sharvil P. Patel. The other members of the Committee are Mr. Ganesh N. Nayak and Mr. Savyasachi S. Sengupta. A CSR Policy has been framed and adopted by the Board and the same is uploaded on the Companyâs website.
As the average net profits of the company as per section 135(5) was negative, no contribution towards CSR was required to be made for the Financial Year ended on March 31, 2022. Other details on CSR, as required under section 135 of the Act read with CSR rules, are given in the CSR Report in Annexure-âBâ.
A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate them. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.
Pursuant to the provisions of section 134(3)(n) of the Act and requirements under the Listing Regulations, the Company has constituted a Risk Management Committee under the Chairmanship of Dr. Sharvil P Patel and Mr. Savyasachi S. Sengupta, Mr. Kulin S. Lalbhai and Mr. Umesh V. Parikh as the members of the Committee. The details of the Committee and its terms of reference are set out in the Corporate Governance Report, forming a part of the Annual Report.
Discussions on risks and concerns are covered in the MDA Report, forming a part of the Annual Report.
Internal Financial Control and their adequacy:
The Company has designed and implemented a process driven framework for Internal Financial Controls ("IFC") within the meaning of the explanation to section 134(5)(e) of the Act. For the Financial Year ended on March 31, 2022, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implemented new and / or improved controls whenever the effect of such gaps would have a material effect on the Companyâs operations.
Managing the risks of fraud, corruption and unethical business practices:
i. Vigil Mechanism / Whistle Blower Policy:
The Company has established Vigil Mechanism and framed Whistle Blower Policy for Directors and employees, to report concerns about unethical behaviour, actual or suspected fraud or violation of the Companyâs Code of Conduct or Ethics Policy. Whistle Blower Policy is disclosed on the website at https://www.zyduswettness. com/investor/Whistle_Blower_Policy-May19.pdf.
ii. Zydus Business Conduct Policy:
The Company has framed "Zydus Business Conduct Policy". Every employee is required to review and sign the policy at the time of joining and an undertaking has to be given for adherence to the Policy. The objective of the Policy is to conduct the business in an honest, transparent and ethical manner. The policy provides for
anti-bribery and avoidance of other corruption practices by the employees of the Company.
Disclosure as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:
The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules framed thereunder. The Company has complied with the provisions relating to the constitution of Internal Complaints Committee.
The Company always endeavors to create and provide conducive work environment that is free from discrimination and harassment including sexual harassment. The Company has in place a robust policy on prevention of sexual harassment at workplace. The policy aims at prevention of harassment of employees as well as contractors and lays down the guidelines for identification, reporting and prevention of sexual harassment.
During the Financial Year ended on March 31, 2022, the Company has not received any complaint of sexual harassment.
Annual Return:
As per the provisions of section 92(3) read with section 134(3) (a) of the Act, the Annual Return as on March 31, 2022 in the prescribed Form No. MGT-7 is available on the website of the Company at https://www.zyduswellness.com/investor/ Draft-anual-report-21-22.pdf.
Particulars of Employees:
The information required under section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is attached herewith as Annexure-âCâ.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo:
Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 134(3)(m) of the Act read with rule 8(3) of the Accounts Rules, is attached herewith as Annexure-âDâ.
Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134(3) of the Act read with rule 8(3) of the Accounts Rules, to the extent the transactions took place on those items during the Financial Year ended on March 31, 2022.
Apart from what are mentioned in this report, there are no material changes and commitments affecting the financial position of the Company between the end of the Financial Year and the date of this report.
Your Directors place on record their sincere appreciation for the continued co-operation and support extended to the Company by the Banks. Your Directors also thank the Trade and Consumers for their patronage to the Companyâs products. Your Directors also place on record sincere appreciation of the continued hard work put in by the employees at all levels. Your Directors also thank the Companyâs Vendors, Investors, Business associates, Stock Exchanges, Government of India, State Government and various departments and Statutory and Government agencies or bodies for their support and co-operation.
By Order of the Board of Directors Dr. Sharvil P. Patel
Place : Mumbai Chairman
Date : May 17 2022 DIN: 00131995
Mar 31, 2019
The Directors are pleased to present Twenty Fifth Annual Report along with the Standalone & Consolidated Audited Financial Statements of the Company for the Financial Year ended on March 31, 2019.
Financial Results:
The financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under section 133 of the Companies Act, 2013, read with Rule 7 of the (Companies Accounts) Rules, 2014.
The standalone and consolidated financial performance of the Company, for the Financial Year ended on March 31, 2019 are summarized below:
Rs. in Lakh
Particulars |
Standalone |
Consolidated |
||
For the year ended on March 31, 2019 |
For the year ended on March 31, 2018 |
For the year ended on March 31, 2019 |
For the year ended on March 31, 2018 |
|
Revenue from Operations and other Income |
31,516 |
29,242 |
88,170 |
55,620 |
Profit before Interest, Depreciation, Amortization and Impairment Expenses & Tax (PBIDT) |
12,970 |
13,922 |
21,323 |
16,032 |
Less: Finance Cost |
2,993 |
159 |
3,009 |
170 |
Less: Depreciation, Amortization and Impairment Expenses |
261 |
351 |
1,251 |
888 |
Profit Before Tax (PBT) |
9,716 |
13,412 |
17,063 |
14,974 |
Less: Tax Expenses |
86 |
32 |
(61) |
1,323 |
Profit After Tax (PAT) |
9,630 |
13,380 |
17,124 |
13,651 |
Attributable to: |
||||
Owners of the Parent |
9,630 |
13,380 |
16,914 |
13,390 |
Non-Controlling Interests |
- |
- |
210 |
261 |
Other Comprehensive Income/(Loss) (net of tax) |
43 |
21 |
2 |
11 |
Total Comprehensive Income |
9,673 |
13,401 |
16,916 |
13,401 |
Attributable to: |
||||
Owners of the Parent |
9,673 |
13,401 |
16,916 |
13,401 |
Non-Controlling Interests |
- |
- |
210 |
261 |
Opening balance in Retained Earnings |
60,739 |
47,360 |
60,713 |
47,323 |
Amount available for appropriation |
||||
Dividend: |
||||
Final - FY 2017-18 |
3,126 |
- |
3,126 |
- |
Corporate Dividend Tax (net of CDT Credit) |
642 |
- |
642 |
- |
Closing Balance in Retained Earnings |
70,369 |
60,739 |
76,488 |
60,713 |
Earnings Per Share (EPS) (Face Value of shares of Rs.10/- each) |
22.83 |
34.24 |
40.10 |
34.27 |
Results of operations (Consolidated):
During the year under review, the consolidated reveune from operations grew by 61.72% to Rs.84,282 Lakhs from Rs.52,114 Lakhs in 2017-18. The profit before tax increased by 13.90% y-o-y to Rs.17,063 Lakhs. Net profit after tax (before OCI and after Non-Controlling Interest) increased by 26.3% y-o-y to Rs.16,914 Lakhs. The Net Profit margin, as a % (Percentage) to total operating income during the current year is 20.10%. A detailed analysis of performance for the year has been included in the Management Discussion and Analysis Report, which forms part of the Annual Report.
Dividend:
During the year under review, your Directors have recommended a dividend of Rs.5/- (50%) per equity share on 5,76,64,144 Equity shares of Rs.10/- each fully paid-up for the Financial Year ended on March 31, 2019, amounting to Rs.3,475.86 Lakhs (inclusive of Dividend Distribution Tax of Rs.592.65 Lakhs). The dividend, if declared, by the members at the ensuing Twenty Fifth Annual General Meeting (AGM), will be paid to those shareholders, whose names stand registered in the Register of Members on July 31, 2019. In respect of shares held in dematerialized form, it will be paid to the members whose names are furnished by the National Securities Depository Limited (NSDL) and the Central Depository Services (India) Limited, (CDSL) as beneficial owners. The Dividend Payout Ratio for the current year (inclusive of Dividend Distribution Tax) is 31.5% of profits.
During the year, the unclaimed dividend pertaining to the dividend for the financial year ended on March 31, 2011 was transferred to Investor Education and Protection Fund (IEPF).
As per SEBI Notification, the Company has formulated a Dividend Distribution Policy, which is approved by the Board of Directors (the Board) and is uploaded on Companyâs website www.zyduswellness.in. The link for the same is http://www. zyduswellness.in/investor/Dividend_Policy-May17.pdf.
Acquisition of Shares of Heinz India Private Limited:
During the year under review, your company had entered into a Share Purchase Agreement jointly with Cadila Healthcare Limited to acquire 100% shareholding of Heinz India Private Limited, (Heinz). The Company along with its wholly owned entity Zydus Wellness - Sikkim, paid a consideration amount of Rs.4,667.36 Crores (which includes payment towards cash and bank balance of Rs.125 Crores in Heinz and acquired 100% shareholding of Heinz as under:
Sr. No. |
Name of the acquirer |
No. of Shares acquired |
% of total shares acquired |
Consideration paid (Rs. in Crores) |
1. |
Zydus Wellness Limited |
70,69,174 |
67.86 % |
3,167.36 |
2. |
Zydus Wellness-Sikkim (converted into a limited liability company in the name of Zydus Nutritions Limited w.e.f. February 28, 2019, a wholly owned subsidiary of the Company) |
33,47,826 |
32.14 % |
1,500.00 |
Total |
1,04,17,000 |
100.00 % |
4,667.36 |
With the acquisition of Heinz, your Company strengthened its portfolio in consumer wellness products, which includes popular brands like Complan, Glucon-D, Nycil and Sampriti Ghee, along with its two large manufacturing facilities located at Aligarh in Uttar Pradesh and Sitarganj in Uttarakhand.
The acquired brands have a strong market presence and a legacy of over 50 years. Glucon D, first launched in 1933, is the leader in the energy drinks segment in India. Complan, a household brand in the health food drink category, was introduced in India in 1969 as a milk based health food drink. Today, Complan is considered to be one of the strongest brands associated with nutrition and health benefits and has a high spontaneous recall of nearly 90% in India. Launched in 1951, Nycil is the number one prickly heat powder with a pan India presence. Sampriti, premium ghee offers immense opportunities for growth in the large retail segment.
Alteration in the Memorandum of Association (MOA) and the Articles of Association (AOA):
During the year under review, the authorized share capital was increased from Rs.45,00,00,000/- (Rupees Forty Five Crores only) divided into 4,50,00,000 (Four Crores Fifty Lakh) equity shares of Rs.10/- (Rupees Ten only) to Rs.100,00,00,000/- (Rupees One Hundred Crores only) divided into 10,00,00,000 (Ten Crores) equity shares of Rs.10/- (Rupees Ten only) and consequently, the Capital Clause of the Memorandum of Association was altered.
Further, pursuant to the Share Subscription Agreement entered into between the Company and True North Fund V and True North Fund VI LLP (True North), certain rights were to be given to True North and for which the Articles of Association was altered.
Issue of Equity Shares on the Preferential Basis:
During the year under review, the Company has issued and allotted 1,85,92,055 Equity Shares of face value of Rs.10/- each at a price of Rs.1,385/- (including a premium of Rs.1,375/-) per equity share to the following investors:
Sr. No. |
Name of the Investor |
No. of Shares |
1 |
Threpsi Care LLP |
72,20,216 |
2 |
Pioneer Investments Fund |
7,22,021 |
3 |
Cadila Healthcare Limited |
84,83,754 |
4 |
Zydus Family Trust |
21,66,064 |
TOTAL |
1,85,92,055 |
The above shares were issued and allotted by way of preferential issue under Chapter VII of Securities and Exchange Board of India (Issue of Securities and Disclosure Requirements) Regulations, 2018 (âSEBI ICDRâ) on January 29, 2019. The above equity shares were listed on the Stock Exchanges, where the existing equity shares are listed.
Upon allotment of the above equity shares, the Issued, Subscribed and Paid-up equity share capital of the Company stands increased to Rs.57,66,41,440/- (Rupees Fifty Seven Crores Sixty Six Lakh Forty One Thousand Four Hundred Forty Only) divided into 5,76,64,144 (Five Crores Seventy Six Lakh Sixty Four Thousand One Hundred Forty Four) equity shares of face value of Rs.10/- (Rupees Ten Only) each.
Issue of Secured Non-Convertible Debentures (âNCDsâ):
During the year under review, your Company raised funds through private placement of 15,000 9.14% Secured, Listed Rated Redeemable Non-Convertible Debentures in 3 (three) tranches, namely Tranche 1, Tranche 2 and Tranche 3, of the face value of Rs.10 Lakhs each, for Rs.500 Crores in each tranche, aggregating to Rs.1,500 Crores, having maturity periods of 3 years, 4 years and 5 years respectively.
The said NCDs carrying interest rate 9.14% (payable semi-annually) were issued and allotted on January 16, 2019 to the identified investors from whom valid online bidding was received and subsequently the NCDs were listed on the Wholesale Debt Market Segment of National Stock Exchange of India Limited (NSE). The Company has entered into Debenture Trustee Agreement(s) for the aforesaid issue of NCDs with Catalyst Trusteeship Limited.
Subsidiary Companies:
During the year under review, your Company has incorporated two wholly owned subsidiaries in the name of Liva Nutritions Limited on December 21, 2018 and Liva Investment Limited on December 24, 2018. Your Company has also invested an amount of Rs.5,00,000/- and Rs.25,00,000/- by subscribing to the Memorandum and Articles of Association of Liva Nutritions Limited and Liva Investment Limited, respectively.
The existing group entity M/s. Zydus Wellness, Sikkim (ZWS), a Partnership Firm, which was under the majority control of the Company, was converted into a Public Limited Company in the name of Zydus Nutritions Limited (ZNL) on February 28, 2019 under chapter XXI of the Companies Act, 2013.
During the year under review, a Scheme of Amalgamation of Heinz with ZNL was filed with the Honâble National Company Law Tribunal, Bench at Ahmedabad and the same was approved on May 10, 2019 and made effective from May 24, 2019. In view of the same, HIPL got merged into ZNL and ceased to be subsidiary from the Appointed Date i.e. March 1, 2019.
Further, as provided in section 136 of the Act, the Balance Sheet, Statement of Profit and Loss and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. The Company will make available free of cost the Audited Financial Statements of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The Financial Statements of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Consolidated Financial Statements presented by the Company include financial results of its subsidiary companies.
As provided under section 129(3) of the Act and Rules made thereunder, a statement containing the salient features of the financial statements of its subsidiaries in the format prescribed under the rules is attached to the financial statements.
The policy relating to material subsidiaries as approved by the Board may be accessed on the Companyâs website at the link: https://zyduswellness.in/investor/Policy%20on%20Material%20 Subsidiary%20Adopted.pdfhttps://zyduswellness.in/investor/ Policy%20on%20Material%20Subsidiary%20Adopted.pdf
Material changes and commitments, if any, affecting the financial position:
There is no such material change and commitment affecting the financial position of your Company which have occurred between the end of the financial year of your Company to which the financial statements relate and the date of the Report.
Transfer of Shares to Investor Education and Protection Fund (IEPF):
In compliance with the provisions of section 124 of the Companies Act, 2013 and rules made thereunder, the Company has transferred 7656 shares of 200 shareholders whose dividend has remained unclaimed / unpaid for a consecutive period of seven years to IEPF.
Fixed Deposit:
The Company has not accepted any fixed deposit and hence no amount of principal or interest was outstanding as of the Balance Sheet date.
Insurance:
The Companyâs plant, properties, equipment and stocks are adequately insured against all major risks. The Parent Company has taken Directorsâ and Officersâ Liability Policy to provide coverage against the liabilities arising on them, which includes the Directors of the Company also.
Management Discussion and Analysis (MDA):
MDA, for the year under review, as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, (âthe Listing Regulationsâ), is presented in a separate section, which forms a part of the Annual Report.
Consolidated Financial Statements:
Liva Nutritions Limited, Liva Investment Limited, Zydus Nutritions Limited and Heinz India Private Limited (for a period of January 31, 2019 to February 28, 2019) are the four subsidiaries of the Company and hence the accounts of all the four Companies are consolidated with the accounts of the Company in accordance with the provisions of Ind AS-110 on Consolidated Financial Statements issued by the Ministry of Corporate Affairs and as provided under the provisions of the Companies Act, 2013 (hereinafter referred to as âActâ) read with Schedule III of the Act and Rules made thereunder and the Listing Regulations. The audited Consolidated Financial Statements are provided in the Annual Report.
Further, in compliance of the provisions of regulation 16(1)(c) of the Listing Regulations, the Company has formed a policy relating to material subsidiaries, which is approved by the Board and may be accessed on the Companyâs website at www.zyduswellness.in.
Related Party Transactions:
All transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis. During the year, the Company had issued equity shares to Cadila Healthcare Limited and Zydus Family Trust as per the resolutions passed by the shareholders at the Extra Ordinary General Meeting held on January 4, 2019.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Companyâs website at www.zyduswellness.in.
Disclosures on related party transactions are set out in Note No. 42 to the financial statements.
Particulars of Loans, Guarantees and Investments:
Details of loans, guarantees and investments covered under section 186 of the Act are given in the notes to the financial statements.
Directors and Key Managerial Personnel:
i. Retirement by rotation:
In accordance with the provisions of section 152(6) of the Act and in terms of Articles of Association of the Company, Mr. Ganesh N. Nayak, Non-executive Director (DIN-00017481) will retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. The Board recommends his re-appointment.
ii. Cessation or Change in Directors:
As per the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018, a Company cannot appoint or continue to appoint any Director who has attained the age of 75 years unless approval of shareholders is obtained by way of a Special Resolution.
In view of the above, Mr. H. Dhanrajgir (DIN-00004006), 82 years and Prof. Indiraben J. Parikh (DIN-00143801), 75 years have ceased to be the Directors of the Company after March 31, 2019.
Based on the recommendation of Nomination and Remuneration Committee, Mr. Savyasachi S. Sengupta (DIN-05158870), Mr. Srivishnu Raju Nandyala (DIN-00025063) and Ms. Dharmishtaben N. Raval (DIN-02792246) were appointed as the Additional Independent Directors of the Company by the Board of Directors on November 2, 2018, March 11, 2019 and March 11, 2019, respectively.
The Board recommends appointment of the above three directors to the members of the Company at the ensuing Twenty Fifth Annual General Meeting.
Further, pursuant to the provisions of Share Subscription Agreement entered into between True North Fund V LLP and True North Fund VI LLP (True North) and relevant articles of the Articles of Association, Mr. Ashish Bhargava was appointed as a Nominee Director of the Company by the Board of Directors at their meeting held on January 30, 2019 representing True North.
The Nominee Director shall continue to hold directorship as long as True North holds 10% of the equity shares of the Company. Mr. Ashish Bhargava shall not be liable to retire by rotation.
iii. Declaration of Independence:
The Company has received declarations of independence as stipulated under section 149(7) of the Act and regulation 16(b) of the Listing Regulations from the Independent Directors confirming that they are not disqualified from continuing as the Independent Directors.
iv. Profile of Directors seeking appointment / reappointment:
As required under regulation 36(3) of the Listing Regulations, particulars of the Directors seeking appointment / reappointment at the ensuing Annual General Meeting are annexed to the notice convening Twenty Fifth Annual General Meeting.
v. Key Managerial Personnel:
The following persons are the Key Managerial Personnel (KMP):
1. Mr. Tarun G. Arora, Chief Executive Officer & Whole Time Director,
2. Mr. Umesh V. Parikh, Chief Financial Officer,
3. Mr. Dhaval N. Soni, Company Secretary (till February 6, 2019); and
4. Mr. DhanrajP Dagar, Company Secretary (w.e.f. February 6, 2019).
The Board of Directors at their meeting held on January 30, 2019 changed the designation of Mr. Tarun G. Arora as Chief Executive Officer and Whole Time Director of the Company.
Further, the Board of Directors at their meeting held on February 6, 2019, on the recommendations of the Nomination and Remuneration Committee, appointed Mr. Dhanraj P. Dagar as the Company Secretary & Compliance Officer and Key Managerial Personnel of the Company w.e.f. February 6, 2019.
Mr. Dhaval N. Soni ceased to be the Company Secretary of the Company w.e.f. February 6, 2019.
vi. Board Evaluation:
Pursuant to the provisions of the Act and the Rules made thereunder and as provided under Schedule IV of the Act and the Listing Regulations, the Nomination and Remuneration Committee / Board has carried out the annual performance evaluation of itself, the Directors individually as well as the evaluation of its committees. The manner in which the evaluation was carried out is provided in the Corporate Governance Report, which is a part of the Annual Report.
vii. Nomination and Remuneration Policy:
The Board has on the recommendations of the Nomination and Remuneration Committee (NRC), framed a Policy on selection and appointment of Director(s), Senior Management Personnel and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report, which is a part of this Report.
Directorsâ Responsibility Statement:
In terms of section 134(3)(c) of the Act and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:
i. that in preparation of the Financial Statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
ii. that such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2019 and of the profit of the Company for the year ended on that date,
iii. that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities,
iv. that the Financial Statements have been prepared on a going concern basis,
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively, and
vi. that the systems to ensure compliance with the provisions of all applicable laws were in place and adequate and operating effectively.
Board Meetings:
Information of meetings of the Board of Directors is given in Corporate Governance Report, forming a part of this Report.
Audit Committee:
As provided in section 177(8) of the Act, the information about composition of Audit Committee and other details are given in Corporate Governance Report, forming a part of this report. The Board has accepted the recommendations of Audit Committee.
The Board of Directors of the Company have reconstituted the Audit Committee on May 1, 2019 which now comprises of Ms. Dharmishtaben N. Raval as Chairperson, Mr. Ganesh N. Nayak, Mr. Kulin S. Lalbhai, Mr. Srivishnu Raju Nandyala, Mr. Savyascahi S. Sengupta and Mr. Ashish Bhargava as its members.
Composition of other Committees:
Composition of other Committees and other details on the Committees are given in the Corporate Governance Report, forming a part of this Annual Report.
Corporate Governance:
The Company has complied with the Corporate Governance requirements under the Act and as stipulated under the Listing Regulations. A separate section on detailed report on the Corporate Governance practices followed by the Company under the Listing Regulations along with a certificate from a Practicing Company Secretary, confirming the compliance forms a part of this Report.
Auditors:
i. Statutory Auditors and their Report:
Dhirubhai Shah & Co., LLP, Chartered Accountants, (Firm Registration No. 102511W/W100298) are appointed as Statutory Auditors from the conclusion of Twenty First Annual General Meeting until the conclusion of Twenty Sixth Annual General Meeting. They have furnished a declaration confirming their independence as well as their armâs length relationship with the Company and that they have not taken up any prohibited non-audit assignments for the Company.
The Board has duly reviewed the Statutory Auditorâs Report for the Financial Year ended on March 31, 2019 and the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in their Report as provided under section 134 of the Act.
ii. Cost Auditors:
Pursuant to the provisions of section 148(3) of the Act read with Companies (Cost Records and Audit) Amendment Rules, 2014 as amended from time to time, the cost audit records maintained by the Company in respect of its product âNutraliteâ are required to be audited. The Board has, on the recommendation of Audit Committee, appointed Dalwadi & Associates, Cost Accountants (Firm Registration No. 000338) to audit the cost records of the Company for the financial year ending on March 31, 2020 at a remuneration of Rs.2.60 Lakhs plus applicable taxes and out of pocket expenses at actuals.
As required under the Act and Rules made thereunder, the remuneration payable to the Cost Auditors is required to be placed before the Members at a general meeting for ratification. Accordingly, a resolution seeking ratification of the remuneration payable to Dalwadi & Associates, Cost Accountants, by the members is included at item No. 8 of the Notice convening Twenty Fifth Annual General Meeting.
iii. Secretarial Auditors and Secretarial Audit Report:
Pursuant to provisions of section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board had appointed Hitesh Buch & Associates, Practicing Company Secretaries, to undertake Secretarial Audit of the Company for the financial year ended on March 31, 2019. The Secretarial Audit Report is attached herewith as Annexure-âAâ.
The Board has reviewed the Secretarial Auditorâs Report and is of the opinion that the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in its Report as provided under section 134 of the Act.
Compliance of Cost Audit Records:
The Company is required to maintain the Cost Records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013 and the rules made thereunder and accordingly such accounts and records are made and maintained.
Compliance with Secretarial Standards:
During the year under review, the Company has complied with the applicable Secretarial Standards i.e. SS-1 and SS-2, relating to âMeetings of the Board of Directorsâ and âGeneral Meetingsâ, respectively, issued by The Institute of Company Secretaries of India.
Business Responsibility Report:
As per regulation 34(2)(f) of the Listing Regulations, a separate section on Business Responsibility Report forms a part of this Report.
Corporate Social Responsibility (CSR):
Pursuant to the provisions of section 135 of the Act and Rules made thereunder, the Board has constituted a CSR Committee under the Chairmanship of Dr. Sharvil P. Patel and was lastly reconstituted on May 1, 2019. The other members of the Committee are Mr. Ganesh N. Nayak and Mr. Savyasachi S. Sengupta. A CSR Policy has been framed and placed on the Companyâs website:https://zyduswellness.in/investor/CSR%20Policy.pdf. Other details of the CSR activities, as required under section 135 of the Act, are given in the CSR Report as Annexure-âBâ.
Business Risk Management:
A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate them. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.
Pursuant to the provisions of section 134(3)(n) of the Act and requirements under the Listing Regulations, the Company has constituted a Risk Management Committee under the Chairmanship of Dr. Sharvil P. Patel and Mr. Savyasachi S. Sengupta, Mr. Kulin S. Lalbhai and Mr. Umesh V. Parikh as the member of the Committee. The details of the Committee and its terms of reference are set out in the Corporate Governance Report, which forms a part of this Report.
Discussions on risks and concerns are covered in the Management Discussion and Analysis Report, which forms a part of this Report.
Internal Control System and their adequacy:
The Company has Internal Control Systems, commensurate with the size, scale and complexity of its operations. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliances with operating systems, accounting procedures and policies within the Company. Based on the report of internal audit function, process owner undertake the corrective action in their respective areas and thereby strengthen the internal controls. Significant observations and corrective actions thereon are presented to the Audit Committee from time to time.
Internal Financial Control and their adequacy:
The Company has designed and implemented a process driven framework for Internal Financial Controls (IFC) within the meaning of the explanation to section 134(5)(e) of the Act. For the year ended on March 31, 2019, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implemented new and / or improved controls whenever the effect of such gaps would have a material effect on the Companyâs operations.
Managing the risks of fraud, corruption and unethical business practices:
i. Vigil Mechanism / Whistle Blower Policy:
The Company has established Vigil Mechanism and framed Whistle Blower Policy for Directors and employees, to report concerns about unethical behaviour, actual or suspected fraud or violation of the Companyâs Code of Conduct or Ethics Policy. Whistle Blower Policy is disclosed on the website of the Company : https://zyduswellness. in/investor/Whistle_Blower_Policy-May19.pdf. As required under SEBI (Prohibition of Insider Trading) (Amendment) Regulations, 2018, the Company has amended the Whistle Blower Policy to enable the employees to report instances of leakage of unpublished price sensitive information.
ii. Zydus Business Conduct Policy:
The Company has framed âZydus Business Conduct Policyâ. Every employee is required to review and sign the policy at the time of joining and an undertaking has to be given for adherence to the Policy. The objective of the Policy is to conduct the business in an honest, transparent and ethical manner. The policy provides for anti-bribery and avoidance of other corruption practices by the employees of the Company.
Disclosure as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:
The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder.
The Company always endeavors to create and provide conducive work environment that is free from discrimination and harassment including sexual harassment. The Company has in place a robust policy on prevention of sexual harassment at workplace. The policy aims at prevention of harassment of employees as well as contractors and lays down the guidelines for identification, reporting and prevention of sexual harassment.
During the Financial Year ended on March 31, 2019, the Company has not received any complaint of sexual harassment.
Extract of Annual Return:
As per the provisions of section 92(3) of the Act, an extract of the Annual Return in the prescribed Form No. MGT-9 is provided as Annexure-âCâ and is also available on the website of the Company at www.zyduswellness.in.
Particulars of Employees:
The information required under section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is given in Annexure-âDâ.
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo:
Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is provided in the Annexure-âEâ and forms a part of this Report.
General Disclosure:
Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134(3) of the Act read with Rule 8(3) of The Companies (Accounts) Rules, 2014 to the extent the transactions took place on those items during the year.
There are no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this report.
Acknowledgement:
Your Directors place on record their sincere appreciation for the continued co-operation and support extended to the Company by the Banks. Your Directors also thank the Trade and Consumers for their patronage to the Companyâs products. Your Directors also place on record sincere appreciation of the continued hard work put in by the employees at all levels. Your Directors also thank the Companyâs vendors, investors, business associates, Stock Exchanges, Government of India, State Government and various departments and statutory and government agencies or bodies for their support and co-operation.
For and on behalf of the Board
Place : Ahmedabad Dr. Sharvil P. Patel
Date : May 28, 2019 Chairman
Mar 31, 2018
Directors'' Report
Dear Members,
The Directors are pleased to present Twenty Fourth Annual Report and the Financial Statements for the Financial Year ended on March 31, 2018.
Financial Results:
The financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under section 133 of the Companies Act, 2013, read with Rule 7 of the (Companies Accounts) Rules, 2014.
The standalone and consolidated financial performance of the Company, for the Financial Year ended on March 31, 2018 are summarized below:
INR in Lakhs
Particulars |
Standalone For the year For the year ended ended on March 31 2018 °n March 31, 2017 |
Consolidated For the year For the year ended ended on March 31 2018 on March 31, 2017 |
||
Revenue from Operations and other Income |
29,242 |
25,245 |
53,821 |
49,519 |
Profit before Interest, Depreciation, Amortization and Impairment Expenses & Tax [PBIDT] |
13,922 |
11,297 |
16,032 |
13,171 |
Less: Finance Cost |
159 |
48 |
170 |
55 |
Less: Depreciation, Amortization and Impairment Expenses |
351 |
370 |
888 |
716 |
Profit Before Tax [PBT] |
13,412 |
10,879 |
14,974 |
12,400 |
Less: Tax Expenses |
32 |
(55) |
1,323 |
1,272 |
Profit After Tax [PAT] |
13,380 |
10,934 |
13,651 |
11,128 |
Attributable to: |
||||
Owners of the Parent |
13,380 |
10,934 |
13,390 |
10,898 |
Non-Controlling Interests |
- |
- |
261 |
230 |
Other Comprehensive Income/(Loss) (net of tax) |
21 |
(15) |
11 |
21 |
Total Comprehensive Income |
13,401 |
10,919 |
13,662 |
11,149 |
Attributable to: |
||||
Owners of the Parent |
13,401 |
10,919 |
13,401 |
10,919 |
Non-Controlling Interests |
- |
- |
261 |
230 |
Opening balance in Retained Earnings |
47,360 |
39,483 |
47,324 |
39,483 |
Amount available for appropriation |
||||
Dividend: |
||||
Interim - FY 2016-17 |
- |
2,540 |
- |
2,540 |
Interim - FY 2015-16 |
- |
2,344 |
- |
2,344 |
Final - FY 2014-15 |
- |
994 |
- |
994 |
Corporate Dividend Tax on Interim Dividend (net of CDT Credit) |
- |
517 |
- |
517 |
Closing Balance in Retained Earnings |
60,740 |
47,360 |
60,714 |
47,324 |
Earnings Per Share [EPS] [Face Value of shares of INR 10/- each] |
34.24 |
27.99 |
34.27 |
27.89 |
Results of Operations (consolidated):
During the year under review, the consolidated sales revenue grew by 7.1% to INR 49,201 Lakhs from INR 45,934 Lakhs in 2016-17. The profit before tax increased by 20.8% y-o-y to INR 14,974 Lakhs. Net profit after tax (before OCI and after Non-Controlling Interest) increased by 22.9% y-o-y to INR 13,390 Lakhs. The Net Profit margin, as a % to total operating income during the current year is 26.6%. A detailed analysis of performance for the year has been included in the Management Discussion and Analysis Report, which forms part of the Annual Report.
Dividend:
During the year under review, your Directors have recommended a dividend of INR 8/- [80%] per equity share on 3,90,72,089 Equity shares of INR 10/- each fully paid-up for the Financial Year ended on March 31, 2018, amounting to INR 3,768.27 Lakhs (inclusive of Dividend Distribution Tax of INR 642.51 Lakhs).The dividend, if declared, by the members at the ensuing Annual General Meeting (AGM), will be paid to those shareholders, whose names stand registered in the Register of Members on August 3, 2018. In respect of shares held in dematerialized form, it will be paid to the members whose names are furnished by the National Securities Depository Limited and the Central Depository Services (India) Limited, as beneficial owners. The Dividend Payout Ratio for the current year (inclusive of Dividend Distribution Tax) is 28.1% of profits.
During the year, the unclaimed dividend pertaining to the dividend for the financial year ended on March 31, 2010 was transferred to Investor Education and Protection Fund.
As per SEBI Notification, the Company has formulated a Dividend Distribution Policy, which is approved by the Board of Directors [the Board] and is uploaded on Company''s website www.zyduswellness.in. The link for the same is http:// www.zyduswellness.in/investor/Dividend_Policy-May17.pdf.
Transfer of Shares to Investor Education and Protection Fund [IEPF]:
In compliance with the provisions of section 124 of the Companies Act, 2013 and rules made there under, the Company has transferred the shares of the shareholders whose dividend has remained unclaimed / unpaid for a consecutive period of seven years to IEPF.
Fixed Deposit:
The Company has not accepted any fixed deposit and, as such, no amount of principal or interest was outstanding as of the Balance Sheet date.
Management Discussion and Analysis [MDA]:
MDA, for the year under review, as stipulated under SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 ["the Listing Regulations"], is presented in a separate section, which forms a part of the Annual Report.
Consolidated Financial Statements:
M/s. Zydus Wellness, Sikkim [ZWS], a Partnership Firm, is under the majority control of the Company and hence the accounts of ZWS are consolidated with the accounts of the Company in accordance with the provisions of Ind AS-110 on Consolidated Financial Statements issued by the Ministry of Corporate Affairs and as provided under the provisions of the Companies Act, 2013 [hereinafter referred to as "Act"] read with Schedule III of the Act and Rules made there under and the Listing Regulations. The audited Consolidated Financial Statements are provided in the Annual Report.
Though the Company does not have any subsidiary Company, in compliance of the provisions of Regulation 16[1][c] of the Listing Regulations, the Company has formed a policy relating to material subsidiaries, which is approved by the Board and may be accessed on the Company''s website at www.zyduswellness.in.
Related Party Transactions:
All 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 has not entered into any transactions with the related parties which could be considered as material in accordance with the policy of the Company on materiality of related party transactions.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at www.zyduswellness.in.
Disclosures on related party transactions are set out in Note No. 41 to the financial statements.
Directors:
i. Retirement by Rotation:
I n accordance with the provisions of section 152[6] of the Act and in terms of Articles of Association of the Company, Mr. Tarun G. Arora, Whole-Time Director [DIN-07185311] will retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment. The Board recommends his reappointment.
ii. Declaration of Independence:
The Company has received declarations of independence as stipulated under section 149[7] of theAct and Regulation 16[b] of the Listing Regulations from the Independent Directors confirming that they are not disqualified from continuing as the Independent Directors.
iii. Profile of Director seeking re-appointment:
As required under Regulation 36[3] of the Listing Regulations, particulars of the Director seeking reappointment at the ensuing Annual General Meeting are annexed to the notice convening Twenty Fourth Annual General Meeting.
iv. Key Managerial Personnel:
The following persons are the Key Managerial Personnel [KMP]:
1. Mr. Tarun G. Arora, Whole Time Director,
2. Mr. Amit B. Jain, Chief Fianancial Officer (till February 7, 2018)
3. Mr. Umesh V. Parikh, Chief Financial Officer (w.e.f. February 7, 2018), and
4. Mr. Dhaval N. Soni, Company Secretary.
The Board of Directors at their meeting held on February 7, 2018, on the recommendations of the Nomination and Remuneration Committee and the Audit Committee, appointed Mr. Umesh V. Parikh as the Chief Financial Officer and Key Managerial Personnel of the Company w.e.f. February 7, 2018.
v. Board Evaluation:
Pursuant to the provisions of the Act and Rules made there under and as provided under Schedule IV of the Act and the Listing Regulations, the Nomination and Remuneration Committee / Board has carried out the annual performance evaluation of itself, the Directors individually as well as the evaluation of its committees. The manner in which the evaluation was carried out is provided in the Corporate Governance Report, which is a part of the Annual Report.
vi. Nomination and Remuneration Policy:
The Board has on the recommendations of the Nomination and Remuneration Committee [NRC], framed a Policy on selection and appointment of Director(s), KMP, Senior Management Personnel and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report, which is a part of this Report.
Directors'' Responsibility Statement:
In terms of section 134[3][c] of the Act and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:
i. that in preparation of the Financial Statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
ii. t hat such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2018 and of the profit of the Company for the year ended on that date,
iii. that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for prevention and detection of fraud and other irregularities,
iv. that the Financial Statements have been prepared on a going concern basis,
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively, and
vi. that the systems to ensure compliance with the provisions of all applicable laws were in place and adequate and operating effectively.
Board Meetings:
Information of meetings of the Board of Directors is given in Corporate Governance Report, forming part of this Report.
Audit Committee:
As provided in section 177[8] of the Act, the information about composition of Audit Committee and other details are given in Corporate Governance Report forming part of this report. The Board accepts the recommendations of Audit Committee.
The Audit Committee comprises of Mr. Humayun Dhanrajgir, as Chairman, Prof. Indiraben J. Parikh, Mr. Ganesh N. Nayak and Mr. Kulin S. Lalbhai as members.
Composition of other Committees:
Composition of other Committees and other details on the Committees are given in the Corporate Governance Report, forming part of this Report.
Corporate Governance:
The Company has complied with the Corporate Governance requirements under the Act and as stipulated under the Listing Regulations. A separate section on detailed report on the Corporate Governance practices followed by the Company under the Listing Regulations along with a certificate from a Practicing Company Secretary, confirming the compliance forms a part of this Report.
Auditors:
i. Statutory Auditors and their Report:
Dhirubhai Shah & Co., Chartered Accountants, [Firm Registration No. 102511W] are appointed as Statutory Auditors from the conclusion of Twenty First Annual General Meeting until the conclusion of Twenty Sixth Annual General Meeting. They have furnished a declaration confirming their independence as well as their arm''s length relationship with the Company and that they have not taken up any prohibited non-audit assignments for the Company.
The Board has duly reviewed the Statutory Auditor''s Report for the Financial Year ended on March 31, 2018 and the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in their Report as provided under section 134 of the Act.
ii. Cost Auditors:
Pursuant to the provisions of section 148[3] of the Act read with Companies [Cost Records and Audit] Amendment Rules, 2014 as amended from time to time, the cost audit records maintained by the Company in respect of its product ''Nutralite'' are required to be audited. The Board has, on the recommendation of Audit Committee, appointed Dalwadi & Associates, Cost Accountants [Firm Registration No. 000338] to audit the cost records of the Company for the financial year ending on March 31, 2019 on a remuneration of INR 2.40 Lakhs plus applicable taxes and out of pocket expenses at actuals.
As required under the Act and Rules made there under, the remuneration payable to the Cost Auditors is required to be placed before the Members at a general meeting for ratification. Accordingly, a resolution seeking ratification of the remuneration payable to Dalwadi & Associates by the members is included at item No. 4 of the Notice convening Twenty Fourth Annual General Meeting.
iii. Secretarial Auditors and Secretarial Audit Report:
Pursuant to provisions of section 204 of the Act and the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014, the Board had appointed Hitesh Buch & Associates, Practicing Company Secretaries, to undertake Secretarial Audit of the Company for the financial year ended on March 31,
2018. The Secretarial Audit Report is attached herewith as Annexure-"A".
The Board has reviewed the Secretarial Auditor''s Report and is of the opinion that the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in its Report as provided under section 134 of the Act.
Business Responsibility Report:
As per Regulation 34[2][f] of the Listing Regulations, a separate section on Business Responsibility Report forms a part of this Report.
Corporate Social Responsibility [CSR]:
Pursuant to the provisions of section 135 of the Act and Rules made thereunder, the Board has constituted a CSR Committee under the Chairmanship of Dr. Sharvil P. Patel. The other members of the Committee are Mr. Ganesh N. Nayak and Prof. Indiraben J. Parikh. A CSR Policy has been framed and placed on the Company''s website. Other details of the CSR activities, as required under section 135 of the Act, are given in the CSR Report as Annexure-"B".
Business Risk Management:
A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place.
The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate them. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.
Discussions on risks and concerns are covered in the Management Discussion and Analysis Report, which forms a part of this Report.
Internal Control System and their adequacy:
The Company has Internal Control Systems, commensurate with the size, scale and complexity of its operations. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliances with operating systems, accounting procedures and policies within the Company. Based on the report of internal audit function, process owner undertake the corrective action in their respective areas and thereby strengthen the internal controls. Significant observations and corrective actions thereon are presented to the Audit Committee from time to time.
Internal Financial Control and their adequacy:
The Company has designed and implemented a process driven framework for Internal Financial Controls [IFC] within the meaning of the explanation to section 134[5][e] of the Act. For the year ended on March 31, 2018, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implemented new and / or improved controls whenever the effect of such gaps would have a material effect on the Company''s operations.
Managing the risks of fraud, corruption and unethical business practices:
i. Vigil Mechanism / Whistle Blower Policy:
The Company has established a vigil mechanism and framed a whistle blower policy for Directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of Company''s Code of Conduct or Ethics Policy. Whistle Blower Policy is disclosed on the website of the Company.
ii. Zydus Business Conduct Policy:
The Company has framed "Zydus Business Conduct Policy". Every employee is required to review and sign the policy at the time of joining and an undertaking has to be given for adherence to the Policy. The objective of the Policy is to conduct the business in an honest, transparent and ethical manner. The policy provides for anti-bribery and avoidance of other corruption practices by the employees of the Company.
Disclosure as per the Sexual Harassment of Women at Workplace [Prevention, Prohibition and Redressal] Act, 2013:
The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under.
The Company always endeavors to create and provide conducive work environment that is free from discrimination and harassment including sexual harassment. The Company has in place a robust policy on prevention of sexual harassment at workplace. The policy aims at prevention of harassment of employees as well as contractors and lays down the guidelines for identification, reporting and prevention of sexual harassment.
During the Financial Year ended on March 31, 2018, the Company has not received any complaint of sexual harassment.
Extract of Annual Return:
As per the provisions of section 92[3] of the Act, an extract of the Annual Return in the prescribed Form No. MGT-9 is attached to this Report as Annexure-"C".
Particulars of Employees:
The information required under section 197 of the Act read with Rule 5[1] of the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014, is given in Annexure-"D".
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo:
Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 134[3][m] of the Act read with Rule 8[3] of the Companies [Accounts] Rules, 2014, is provided in the Annexure-"E" and forms a part of this Report.
General Disclosure:
Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134[3] of the Act read with Rule 8[3] of the Companies [Accounts] Rules, 2014 to the extent the transactions took place on those items during the year.
There are no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this report.
Acknowledgement:
Your Directors place on record their sincere appreciation for the continued co-operation and support extended to the Company by the Banks. Your Directors also thank the Trade and Consumers for their patronage to the Company''s products. Your Directors also place on record sincere appreciation of the continued hard work put in by the employees at all levels. Your Directors also thank the Company''s vendors, investors, business associates, Stock Exchanges, Government of India, State Government and various departments and statutory and government agencies or bodies for their support and cooperation.
For and on behalf of the Board
Place: Ahmedabad Dr. Sharvil P. Patel
Date: May 24, 2018 Chairman
Mar 31, 2017
Dear members,
The Directors are pleased to present Twenty Third Annual Report and the Financial Statements for the Financial Year ended on March 31, 2017.
Financial Results:
The financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) notified under section 133 of the Companies Act, 2013, read with Rule 7 of the [Companies Accounts] Rules, 2014. The financial statements for the Financial Year ended on March 31, 2017 are the Company''s first Ind AS compliant annual financial statements with comparative figures for the year ended on March 31, 2016 also under Ind AS. The date of transition is April 1, 2015.
The disclosure and effects of first time adoption of Ind AS are detailed in Note 43 of the standalone financial statements and Note 43 of the consolidated financial statements.
The standalone and consolidated financial performance of the Company, for the Financial Year ended on March 31, 2017 are summarized below: [INR-Lakhs]
Particulars |
Standalone |
Consolidated |
||
For the year ended on March 31, 2017 |
For the year ended on March 31, 2016 |
For the year ended on March 31, 2017 |
For the year ended on March 31, 2016 |
|
Revenue from Operations and Other Income |
25,245 |
23,231 |
49,519 |
45,844 |
Profit before Finance Cost, Depreciation, Amortization and Impairment Expenses & Tax [PBIDT] |
11,297 |
10,764 |
13,171 |
12,375 |
Less: Finance Cost |
48 |
6 |
55 |
14 |
Less: Depreciation, Amortization and Impairment expenses |
370 |
355 |
716 |
681 |
Profit Before Tax [PBT] |
10,879 |
10,403 |
12,400 |
11,680 |
Less: Tax Expenses |
(55) |
77 |
1,272 |
1,156 |
Profit After Tax [PAT] |
10,934 |
10,326 |
11,128 |
10,524 |
Attributable to: |
||||
Owners of the Parent |
10,934 |
10,326 |
10,898 |
10,326 |
Non-Controlling Interests |
- |
- |
230 |
198 |
Other Comprehensive Income / (Loss), Net of Tax |
(15) |
(16) |
21 |
(16) |
Total Comprehensive Income |
10,919 |
10,310 |
11,149 |
10,508 |
Attributable to: |
||||
Owners of the Parent |
10,919 |
10,310 |
10,919 |
10,310 |
Non-Controlling Interests |
- |
- |
230 |
198 |
Opening balance in Retained Earnings |
39,438 |
35,035 |
39,482 |
35,034 |
Amount available for appropriation |
||||
Dividend: |
||||
Interim - FY 2016-17 |
2,540 |
- |
2,540 |
- |
Interim - FY 2015-16 |
- |
2,540 |
- |
2,540 |
Final - FY 2014-15 |
- |
2,344 |
- |
2,344 |
Corporate Dividend Tax on Interim/Final |
517 |
994 |
517 |
994 |
Dividend |
||||
Closing Balance in Retained Earnings |
47,360 |
39,483 |
47,323 |
39,482 |
Earnings Per Share [EPS] [Face Value of shares of |
27.99 |
26.43 |
27.89 |
26.43 |
Rs. 10/- each] |
Results of operations: (Consolidated)
During the year under review, the consolidated sales revenue grew by 8.3% to Rs. 45934 Lakhs from Rs. 42419 Lakhs in 2015-16. The profit before tax increased by 6.2% y-o-y to Rs. 12400 Lakhs. Net profit after tax (before OCI and after Non Controlling Interest) increased by 5.5% y-o-y to Rs.10898 Lakhs. The net profit margin, as a % to total operating income during the current year is 23.6%. A detailed analysis of performance for the year has been included in the Management Discussion and Analysis Report, which forms part of the Annual Report
Interim Dividend:
During the year under review, your Directors have declared and paid an interim dividend of Rs. 6.50 [65%] per equity share of face value of Rs. 10/- each to the shareholders holding shares in physical form and whose names were entered into the Register of Members of the Company as on March 10, 2017, being the Record Date fixed for the purpose. The shareholders holding shares in electronic form were paid dividend as per the beneficiary data provided by the Depositories. Your Directors do not recommend final dividend. The dividend payout ratio for the current year [inclusive of corporate dividend tax on dividend distribution] is 27.96%.
During the year, the unclaimed dividend pertaining to the dividend for the financial year ended on March 31, 2009 was transferred to Investor Education and Protection Fund.
As per Regulation 43A of the SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 (the Listing Regulations), the top 500 listed companies shall formulate a dividend distribution policy. Accordingly, the Company has formulated a Dividend Distribution Policy, which is approved by the Board of Directors [the Board] and is uploaded on Company''s website www.zyduswellness.in.
Transfer of Shares to Investor Education and Protection Fund [IEPF]:
Pursuant to the applicable provisions of the Companies Act, 2013, read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (''the Rules''), all unpaid or unclaimed dividends are required to be transferred by the Company to IEPF established by the Central Government, after completion of seven years. Further according to the Rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company has transferred the unclaimed and unpaid dividends. Further, the corresponding shares will be transferred as per the requirements of the IEPF rules, details of which are provided on our website.
Fixed Deposit:
The Company has not accepted any fixed deposit and, as such, no amount of principal or interest was outstanding as of the Balance Sheet date.
Management Discussion and Analysis [MDA]:
MDA, for the year under review, as stipulated under Regulation 34[2][e] of SEBI [Listing Obligations and Disclosure Requirements]
Regulations, 2015 [hereinafter referred to as "the Listing Regulationsâ], is presented in a separate section, which forms a part of the Annual Report.
Consolidated Financial Statements:
M/s. Zydus Wellness, Sikkim [ZWS] is under the majority control of the Company and hence the accounts of ZWS are consolidated with the accounts of the Company in accordance with the provisions of Ind AS-110 on Consolidated Financial Statements issued by the Ministry of Corporate Affairs and as provided under the provisions of the Companies Act, 2013 [hereinafter referred to as "Actâ] read with Schedule III of the Act and Rules made thereunder and the Listing Regulations. The audited Consolidated Financial Statements are provided in the Annual Report.
Though the Company does not have any subsidiary Company, in compliance of the provisions of Regulation 16[1][c] of the Listing Regulations, the Company has formed a policy relating to material subsidiaries, which is approved by the Board and may be accessed on the Company''s website at the link http://www.zyduswellness. in/investor/Policy%20on%20Material%20Subsidiary-May15.pdf
Related Party Transactions:
All 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 has not entered into any transactions with the related parties which could be considered as material in accordance with the policy of the Company on materiality of related party transactions.
The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website at the link: http://www. zyduswellness.in/investor/Policy%20on%20Related%20Party%20 Transactions-May15.pdf.
Disclosures on related party transactions are set out in Note No. 41 to the financial statements.
Directors:
i. Resignation / Appointment of Independent Directors:
Dr. B. M. Hegde [DIN-00128203], an Independent Director resigned as a Director of the Company w.e.f. October 11, 2016. Dr. B. M. Hegde also ceased to be the member of the Committees of the Board in which he was a member.
The Board has appointed Mr. Kulin S. Lalbhai [DIN-05206878] as an Additional Independent Director of the Company for a period of five consecutive years from November 18, 2016, subject to the approval of the shareholders. Mr. Kulin S. Lalbhai was appointed as an Additional Independent Director, who shall hold office up to the ensuing Annual General Meeting.
The Board at its meeting held on January 30, 2017 has also appointed Mr. Kulin S. Lalbhai as a member of the Audit Committee and the Nomination and Remuneration Committee.
The terms and conditions of appointment of Mr. Kulin S. Lalbhai are placed on the website of the Company www. zyduswellness.in.
ii. Retirement by rotation:
In accordance with the provisions of section 152[6] of the Act and in terms of Articles of Association of the Company, Dr. Sharvil P. Patel, Director [DIN-00131995] will retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. The Board recommends his reappointment.
iii. Declaration of Independence:
The Company has received declarations of independence as stipulated under section 149[7] of the Act and Regulation 16[b] of the Listing Regulations from the Independent Directors confirming that they are not disqualified from continuing as an Independent Director.
iv. Profile of Directors seeking appointment / reappointment:
As required under Regulation 36[3] of the Listing Regulations, particulars of the Directors seeking appointment / reappointment at the ensuing Annual General Meeting are annexed to the notice convening Twenty Third Annual General Meeting.
v. Key Managerial Personnel:
The following persons are the Key Managerial Personnel [KMP]:
1. Mr. Tarun G. Arora, Whole Time Director,
2. Mr. Amit B. Jain, Chief Financial Officer, and
3. Mr. Dhaval N. Soni, Company Secretary.
There is no change in the KMP during the year.
vi. Board Evaluation:
Pursuant to the provisions of the Act and Rules made there under and as provided under Schedule IV of the Act and the Listing Regulations, the Nomination and Remuneration Committee / Board has carried out the annual performance evaluation of itself, the Directors individually as well as the evaluation of its committees. The manner in which the evaluation was carried out is provided in the Corporate Governance Report, which is a part of this Annual Report.
vii. Nomination and Remuneration Policy:
The Board has on the recommendations of the Nomination and Remuneration Committee [NRC], framed a Policy on selection and appointment of Director(s), Senior Management Personnel and their remuneration. During the year, the NRC was reconstituted. The NRC comprises of Mr. Humayun Dhanrajgir, as Chairman, Dr. Sharvil P. Patel, Prof. Indiraben J. Parikh, Mr. Ganesh N. Nayak and Mr. Kulin S. Lalbhai as members.
The Nomination and Remuneration Policy is stated in the Corporate Governance Report, which is a part of this Annual Report.
Directors'' Responsibility Statement:
In terms of section 134[3][c] of the Act and to the best of their knowledge and belief, and according to the information and explanations provided to them, your Directors hereby make the following statements:
i. that in preparation of the Financial Statements, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any,
ii. that such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as on March 31, 2017 and of the profit of the Company for the year ended on that date,
iii. that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for prevention and detection of fraud and other irregularities,
iv. that the Financial Statements have been prepared on a going concern basis,
v. that proper internal financial controls were in place and that the financial controls were adequate and operating effectively, and
vi. that the systems to ensure compliance with the provisions of all applicable laws were in place and adequate and operating effectively.
Board Meetings:
Information of meetings of the Board of Directors is given in Corporate Governance Report, forming part of this report.
Audit Committee:
As provided in section 177[8] of the Act, the information about composition of Audit Committee and other details are given in Corporate Governance Report forming part of this report. The Board has accepted the recommendations of Audit Committee. During the year, the Audit Committee was reconstituted. The Audit Committee comprises of Mr. Humayun Dhanrajgir, as Chairman, Prof. Indiraben J. Parikh, Mr. Ganesh N. Nayak and Mr. Kulin S. Lalbhai as members.
Composition of other Committees:
Composition of other Committees and other details on the Committees are given in the Corporate Governance Report.
Corporate Governance:
The Company has complied with the Corporate Governance requirements under the Act and as stipulated under the Listing Regulations. A separate section on detailed report on the Corporate Governance practices followed by the Company under the Listing Regulations along with a certificate from a Practicing Company Secretary, confirming the compliance forms part of this Annual Report.
Auditors:
i. Statutory Auditors and their Report:
M/s. Dhirubhai Shah & Doshi, Chartered Accountants, [Firm Registration No. 102511W] were appointed as Statutory Auditors from the conclusion of Twenty First Annual General Meeting until the conclusion of Twenty Sixth Annual General Meeting. They have informed to the Company that their appointment, if made, would be within the limits prescribed under section 141 of the Act. They have also furnished a declaration confirming their independence as well as their arm''s length relationship with the Company and that they have not taken up any prohibited non-audit assignments for the Company.
The Board has duly reviewed the Auditor''s Report and the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in their Report as provided under section 134 of the Act.
ii. Cost Auditors:
Pursuant to the provisions of section 148[3] of the Act read with Companies [Cost Records and Audit] Amendment Rules, 2014 as amended from time to time, the cost audit records maintained by the Company in respect of its product ''Nutralite'' is required to be audited by a Cost Auditor. The Board has, on the recommendation of Audit Committee, appointed M/s. Dalwadi & Associates, Cost Accountants [Firm Registration No. 000338] to audit the cost records of the Company for the financial year ending on March 31, 2018 on a remuneration of Rs. 2.25 Lakhs.
As required under the Act and Rules made there under, the remuneration payable to the Cost Auditors is required to be placed before the Members at a general meeting for ratification. Accordingly, a resolution seeking ratification of the remuneration payable to M/s. Dalwadi & Associates by the members is included at Item No. 5 of the Notice convening Twenty Third Annual General Meeting.
iii. Secretarial Auditors and Secretarial Audit Report:
Pursuant to the provisions of section 204 of the Act and the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014, the Board has appointed M/s. Hitesh Buch & Associates, a firm of Company Secretaries in whole time practice, to undertake Secretarial Audit of the Company for the financial year ended on March 31, 2017. The Secretarial Audit Report is attached herewith as Annexure-"A" The Board has duly reviewed the Auditor''s Report.
The Board is of the opinion that the observations and comments, appearing in the report are self-explanatory and do not call for any further explanation / clarification by the Board in their Report as provided under section 134 of the Act.
Business Responsibility Report:
As per Regulation 34[2][f] of the Listing Regulations, a separate section on Business Responsibility Report forms part of this Annual Report.
Corporate Social Responsibility [CSR]:
Pursuant to the provisions of section 135 of the Act and Rules made there under, the Board has constituted a CSR Committee under the Chairmanship of Dr. Sharvil P. Patel. The other members of the Committee are Mr. Ganesh N. Nayak and Prof. Indiraben J. Parikh. A CSR Policy has been framed and placed on the Company''s website. Other details of the CSR activities, as required under section 135 of the Act, are given in the CSR Report as Annexure-"B".
Business Risk Management:
A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. The objective of the mechanism is to minimize the impact of risks identified and taking advance actions to mitigate them. The mechanism works on the principles of probability of occurrence and impact, if triggered. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.
Discussions on risks and concerns are covered in the Management Discussion and Analysis Report, which forms part of this Annual Report.
Internal Control System and their adequacy:
The Company has Internal Control Systems, commensurate with the size, scale and complexity of its operations. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems in the Company, its compliances with operating systems, accounting procedures and policies within the Company. Based on the report of internal audit function, process owner undertake the corrective action in their respective areas and thereby strengthen the internal controls. Significant observations and corrective actions thereon are presented to the Audit Committee from time to time.
Internal Financial Control and their adequacy:
The Company has designed and implemented a process driven framework for Internal Financial Controls [IFC] within the meaning of the explanation to section 134[5][e] of the Act. For the year ended on March 31, 2017, the Board is of the opinion that the Company has sound IFC commensurate with the size, scale and complexity of its business operations. The IFC operates effectively and no material weakness exists. The Company has a process in place to continuously monitor the same and identify gaps, if any, and implemented new and / or improved controls whenever the effect of such gaps would have a material effect on the Company''s operations.
Managing the risks of fraud, corruption and unethical business practices:
i. Vigil Mechanism / Whistle Blower Policy:
The Company has established vigil mechanism and framed whistle blower policy for Directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of Company''s Code of Conduct or Ethics Policy. Whistle Blower Policy is disclosed on the website of the Company.
ii. Zydus Business Conduct Policy:
The Company has framed "Zydus Business Conduct Policy" Every employee is required to review and sign the policy at the time of joining and an undertaking has to be given for adherence to the Policy. The objective of the Policy is to conduct the business in an honest, transparent and ethical manner. The policy provides for anti-bribery and avoidance of other corruption practices by the employees of the Company.
Disclosure as per the Sexual Harassment of Women at Workplace [Prevention, Prohibition and Redressal] Act, 2013:
The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under.
The Company always endeavors to create and provide conducive work environment that is free from discrimination and harassment including sexual harassment. The Company has in place a robust policy on prevention of sexual harassment at workplace. The policy aims at prevention of harassment of employees as well as contractors and lays down the guidelines for identification, reporting and prevention of sexual harassment.
During the Financial Year 2016-2017, the Company has not received any complaint of sexual harassment.
Extract of Annual Return:
As per the provisions of section 92[3] of the Act, an extract of the Annual Return in the prescribed Form No. MGT-9 is attached to this Report as Annexure-"C"
Particulars of Employees:
The information required under section 197 of the Act read with Rule 5[1] of the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014, is given in Annexure-"D"
Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo:
Information on conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under section 134[3][m] of the Act read with Rule 8[3] of the Companies [Accounts] Rules, 2014, is provided in the Annexure-"E" and forms part of this Report.
General Disclosure:
Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134[3] of the Act read with Rule 8[3] of the Companies [Accounts] Rules, 2014 to the extent the transactions took place on those items during the year.
There are no material changes and commitments affecting the financial position of the Company between the end of the financial year and the date of this report.
Acknowledgement:
Your Directors place on record their sincere appreciation for the continued co-operation and support extended to the Company by the Banks. Your Directors also thank the Trade and Consumers for their patronage to the Company''s products. Your Directors also place on record sincere appreciation of the continued hard work put in by the employees at all levels. Your Directors also thank the Company''s vendors, investors, business associates, Stock Exchanges, Government of India, State Government and various departments and agencies for their support and co-operation.
For and on behalf of the Board
Place: Ahmedabad Dr. Sharvil P. Patel
Date: May 27, 2017 Chairman
Mar 31, 2016
The Directors are pleased to present Twenty Second Annual Report and
the Financial Statements for the financial year ended March 31, 2016.
Financial Results:
The financial performance of the Company, for the year ended March 31,
2016 is summarized below:
[INR-Lacs]
Particulars Standalone Consolidated
For the For the For the For the
year ended year ended year ended year ended
March 31 March 31 March 31 March 31
2016 2015 2016 2015
Sales and Other
Income 23,683 23,956 46,047 45,831
Profit before
Interest,
Depreciation 10,606 11,332 12,217 12,751
& Tax [PBIDT]
Less: Depreciation 355 455 681 773
Profit before
Interest & Tax
(PBIT) 10,251 10,877 11,536 11,978
Less: Interest 5 5 13 13
Profit Before Tax
[PBT] 10,246 10,872 11,523 11,965
Less: Provision
for Tax 77 -23 1,156 850
Profit After Tax
[PAT] 10,169 10,895 10,367 11,115
Less: Minority
Interest - - 198 220
Profit attributable
to shareholders 10,169 10,895 10,169 10,895
Add: Profit brought
forward from 32,197 24,149 32,197 24,149
the previous year
Less: Additional
depreciation upon 0 26 0 26
revision in useful
lives of tangible
assets
Profit available
for appropriation, 42,366 35,018 42,366 35,018
which is appropriated
as follows:
Interim Dividend 2,540 - 2,540 -
Proposed Final
Dividend 0 2,344 0 2,344
Corporate Dividend
Tax on Interim /
Final 517 477 517 477
Dividend
Balance carried to
Balance Sheet 39,309 32,197 39,309 32,197
Total 42,366 35,018 42,366 35,018
Earnings Per Share
[EPS] [Face Value
of Shares 26.03 27.88 26.03 27.88
of Rs. 10/- each]
The Company proposes to retain an amount of Rs. 39,309 lacs in the
Statement of Profit and Loss.
Results of operations:
During the year under review, the consolidated gross sales revenue grew
by 3.20% to Rs. 45,698 lacs from Rs. 44,301 lacs in 2014-15. The profit
before tax, on a like-to-like basis, increased by 10.70% y-o-y to Rs.
11,523 lacs. Net profit after tax, on like-to-like basis, increased by
10.40% y-o-y to Rs. 10,169 lacs. The net profit margin, on a
like-to-like basis, as a % to total operating income, has increased to
23.70% from 22.20% last year. A detailed analysis of performance for
the year has been included in the Management Discussion and Analysis,
which forms a part of the Annual Report.
Interim Dividend:
During the year under review, your Directors had declared and paid an
interim dividend of Rs. 6.5/- [65%] per equity share of face value of
Rs. 10/- each to the shareholders holding shares in physical form and
whose names were listed on the Register of Members of the Company as on
March 17, 2016, being the Record Date fixed for the purpose. Those
shareholders holding shares in electronic form were paid dividend as
per the beneficiary data provided by the Depositories. Your Directors
did not recommend final dividend. The dividend payout ratio for the
current year [inclusive of corporate dividend tax on dividend
distribution] is 30.10%.
During the year, the unclaimed dividend pertaining to the dividend for
the year ended March 31, 2008 was transferred to Investor Education and
Protection Fund.
Management Discussion and Analysis [MDA]:
MDA, for the year under review, as stipulated under clause 49 of the
Listing Agreement/Regulation 34[2][e] of SEBI [Listing Obligations and
Disclosure Requirements] Regulations, 2015, [hereinafter referred to as
Listing Regulations] is presented in a separate section, which forms a
part of the Annual Report.
Consolidated Financial Statements:
Zydus Wellness, Sikkim [ZWS] is under the majority control of the
Company and hence the accounts of ZWS are consolidated with the
accounts of the Company in accordance with the provisions of Accounting
Standard [AS]Â 21 on Consolidated Financial Statements issued by the
Institute of Chartered Accountants of India and as provided under the
provisions of Companies Act, 2013 [hereinafter referred to as "Act"]
read with Schedule III of the Act and Rules made thereunder and Listing
Agreement/Listing Regulations. The audited Consolidated Financial
Statements are provided in the Annual Report.
Though Company does not have any subsidiary Company, in compliance of
the provisions of Regulation 16[1][c] of the Listing Regulations, the
Company has formed a policy relating to material subsidiaries, which is
approved by the Board of Directors and may be accessed on the Company''s
website at the link: http://www.zyduswellness.in/
investor/Policy%20on%20Material%20Subsidiary-May15.pdf
Related Party Transactions:
All 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
transactions with related parties which could be considered as material
in accordance with the policy of the Company on materiality of related
party transactions.
The Policy on materiality of related party transactions and dealing
with related party transactions as approved by the Board may be
accessed on the Company''s website at the link:
http://www.zyduswellness.in/investor/
Policy%20on%20Related%20Party%20Transactions-May15.pdf. Disclosures on
related party transactions are set out in Note No. 34 to the financial
statements.
Directors:
i. Retirement by rotation:
In accordance with the provisions of section 152[6] of the Act and in
terms of Articles of Association of the Company, Mr. Ganesh N. Nayak,
Director [DINÂ00017481] will retire by rotation at the ensuing Annual
General Meeting and being eligible, offers himself for reappointment.
The Board recommends his reappointment.
ii. Declaration of Independence:
The Company has received declarations of independence as stipulated
under section 149[7] of the Act and Regulation 16[b] of the Listing
Regulations from Independent Directors confirming that they are not
disqualified from continuing as an Independent Director.
iii. Profile of Director seeking reappointment:
As required under Regulation 36[3] of the Listing Regulations,
particulars of the Director seeking reappointment at the ensuing Annual
General Meeting is annexed to the notice convening Twenty Second Annual
General Meeting.
iv. Key Managerial Personnel:
The following persons are the Key Managerial Personnel:
1. Mr. Tarun G. Arora, Whole Time Director,
2. Mr. Amit B. Jain, Chief Financial Officer and
3. Mr. Dhaval N. Soni, Company Secretary.
There is no change in the Key Managerial Personnel during the year.
v. Board Evaluation:
Pursuant to the provisions of the Act and Rules made thereunder and as
provided under Schedule IV of the Act and the Listing Regulations,
Nomination and Remuneration Committee / Board has carried out the
annual performance evaluation of itself, the Directors individually as
well as the evalution of its committees. The manner in which the
evaluation was carried out is provided in the Corporate Governance
Report, which is a part of this Annual Report.
vi. Nomination and Remuneration Policy:
The Board has on the recommendations of Nomination and Remuneration
Committee, framed a Policy on selection and appointment of Directors,
Senior Management and their remuneration. The Nomination and
Remuneration Policy is stated in the Corporate Governance Report, which
is a part of this Annual Report.
Directors'' Responsibility Statement:
In terms of section 134[3][c] of the Act and to the best of their
knowledge and belief, and according to the information and explanations
provided to them, your Directors hereby make the following statements:
i. that in preparation of the Financial Statements, the applicable
accounting standards have been followed along with proper explanations
relating to material departures, if any,
ii. that such accounting policies have been selected and applied
consistently and judgments and estimates made that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as on March 31, 2016 and of the profit of the Company for
the year ended on that date,
iii. that proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Act for safeguarding the assets of the company and for prevention and
detection of fraud and other irregularities,
iv. that the Financial Statements have been prepared on a going
concern basis,
v. that proper internal financial controls were in place and that the
financial controls were adequate and were operating effectively and
vi. that the systems to ensure compliance with the provisions of all
applicable laws were in place and were adequate and operating
effectively.
Board Meetings:
Information of meetings of the Board of Directors is given in Corporate
Governance Report, forming a part of this report.
Audit Committee:
As provided in section 177[8] of the Act, the information about
composition of Audit Committee and other details are given in Corporate
Governance Report, forming a part of this report. The Board has
accepted the recommendations of Audit Committee. The Audit Committee is
comprising of Mr. H. Dhanrajgir, as Chairman and Dr. B. M. Hegde, Prof.
Indiraben J Parikh and Mr. Ganesh N. Nayak as members.
Corporate Governance:
The Company has complied with the Corporate Governance requirements
under the Act and as stipulated under clause 49 of the Listing
Agreement/Listing Regulations. A separate section on detailed report on
the Corporate Governance practices followed by the Company under the
Listing Agreement/Listing Regulations along with a certificate from a
Practicing Company Secretary, confirming the compliance form a part of
this Annual Report.
Auditors:
i. Statutory Auditors and their Report:
M/s. Dhirubhai Shah & Doshi, Chartered Accountants, [Firm Registration
No. 102511W] were appointed as Statutory Auditors from the conclusion
of Twenty First Annual General Meeting until the conclusion of Twenty
Sixth Annual General Meeting. They have informed to the Company that
their appointment, if made, would be within the limits prescribed under
section 141 of the Act. They have also furnished a declaration
confirming their independence as well as their arm''s length
relationship with the Company and that they have not taken up any
prohibited non-audit assignments for the Company. The Board has duly
reviewed the Auditor''s Report and the observations and comments,
appearing in the report are self-explanatory and do not call for any
further explanation / clarification by the Board of Directors as
provided under section 134 of the Act.
ii. Cost Auditors:
Pursuant to provisions of section 148[3] of the Act read with Companies
[Cost Records and Audit] Amendment Rules, 2014, the cost audit records
maintained by the Company in respect of its product ''Nutralite'' is
required to be audited. The Board had, on the recommendation of Audit
Committee, appointed M/s. Dalwadi & Associates, Cost Accountants [Firm
Registration No. 000338] to audit the cost records of the Company for
the financial year ending on March 31, 2017 on a remuneration of Rs.
2.00 lacs. As required under the Act and Rules made thereunder, the
remuneration payable to the Cost Auditors is required to be placed
before the Members at a general meeting for ratification. Accordingly,
a resolution seeking ratification by members for the remuneration
payable to M/s. Dalwadi & Associates is included at item No. 5 of the
Notice convening Twenty Second Annual General Meeting.
iii. Secretarial Auditors and Secretarial Audit Report:
Pursuant to provisions of section 204 of the Act and The Companies
[Appointment and Remuneration of Managerial Personnel] Rules, 2014, the
Board has appointed M/s. Hitesh Buch & Associates, a firm of Company
Secretaries in whole time practice to undertake Secretarial Audit of
the Company for the financial year ended on March 31, 2016. The
Secretarial Audit Report is attached herewith as AnnexureÂ"A". The
Board has duly reviewed the Auditor''s Report and the observations and
comments, appearing in the report are self-explanatory and do not call
for any further explanation / clarification by the Board of Directors
as provided under section 134 of the Act.
Corporate Social Responsibility [CSR]:
Pursuant to provisions of section 135 of the Act and Rules made
thereunder, the Board has constituted a Corporate Social Responsibility
[CSR] Committee under the Chairmanship of Dr. Sharvil P. Patel. The
other members of the Committee are Mr. Ganesh N. Nayak and Prof.
Indiraben J. Parikh. CSR Policy has been framed and placed on the
Company''s website. Other details of the CSR activities, as required
under section 135 of the Act, are given in the CSR Report as
AnnexureÂ"B".
Business Risk Management:
A well-defined risk management mechanism covering the risk mapping and
trend analysis, risk exposure, potential impact and risk mitigation
process is in place. The objective of the mechanism is to minimize the
impact of risks identified and taking advance actions to mitigate them.
The mechanism works on the principles of probability of occurrence and
impact, if triggered. A detailed exercise is being carried out to
identify, evaluate, monitor and manage both business and non-business
risks.
Discussion on risks and concerns are covered in the Management
Discussion and Analysis Report, which forms a part of this Annual
Report.
Internal control system and its adequacy:
The Company has designed and implemented a process driven framework for
Internal Financial Controls [IFC] within the meaning of the explanation
to section 134[5][e] of the Act. For the year ended on March 31, 2016,
the Board is of the opinion that the Company has sound IFC commensurate
with the size, scale and complexity of its business operations. The IFC
operates effectively and no material weakness exists. The Company has a
process in place to continuously monitor the same and identify gaps, if
any, and implement new and / or improved controls whenever the effect
of such gaps would have a material effect on the Company''s operations.
Managing the risks of fraud, corruption and unethical business
practices:
i. Vigil Mechanism / Whistle Blower Policy:
The Company has established vigil mechanism and framed whistle blower
policy for Directors and employees to report concerns about unethical
behavior, actual or suspected fraud or violation of Company''s Code of
Conduct or Ethics Policy. Whistle Blower Policy is disclosed on the
website of the Company.
ii. Zydus Business Conduct Policy:
The Company has framed "Zydus Business Conduct Policy". Every employee
is required to review and sign the policy at the time of joining and an
undertaking has to be given for adherence to the Policy. The objective
of the Policy is to conduct the business in an honest, transparent and
ethical manner. The policy provides for anti-bribery and avoidance of
other corruption practices by the employees of the Company.
Extract of Annual Return:
As per the provisions of section 92[3] of the Act, an extract of the
Annual Return in the prescribed Form No. MGT-9 is attached to this
Report as AnnexureÂ"C".
Composition of Audit Committee:
More details on the Committee are given in the Corporate Governance
Report.
Particulars of Employees:
The information required under section 197 of the Act read with Rule
5[1] of The Companies [Appointment and Remuneration of Managerial
Personnel] Rules, 2014, is given in AnnexureÂ"D".
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo:
Information on conservation of energy, technology absorption, foreign
exchange earnings and outgo, as required to be disclosed under section
134[3][m] of the Act read with Rule 8[3] of the Companies [Accounts]
Rules, 2014, is provided in the AnnexureÂ"E" and forms a part of this
Report.
General Disclosure:
Your Directors state that the Company has made disclosures in this
report for the items prescribed in section 134[3] of the Act read with
Rule 8[3] of The Companies [Accounts] Rules, 2014 to the extent the
transactions took place on those items during the year.
There are no material changes and commitments affecting the financial
position of the Company between the end of the financial year and the
date of this report.
Acknowledgement:
Your Directors place on record their sincere appreciation for the
continued co-operation and support extended to the Company by the
Banks. Your Directors also thank the Trade and Consumers for their
patronage to the Company''s products. Your Directors also place on
record sincere appreciation of the continued hard work put in by the
employees at all levels. Your Directors also thank the Company''s
vendors, investors, business associates, Stock Exchanges, Government of
India, State Government and various departments and agencies for their
support and co-operation.
For and on behalf of the Board
Place : Ahmedabad Sharvil P. Patel
Date : May 12, 2016 Chairman
Mar 31, 2015
Dear Members,
The Directors are pleased to present 21st Annual Report and the
audited financial statements for the financial year ended on 31st
March, 2015.
Financial Results:
The financial performance of the Company, for the year ended on 31st
March, 2015 is summarized below:
[INR Lacs]
Particulars Standalone Consolidated
For the For the For the For the
year ended year ended year ended year ended
31st March 31st March 31st March 31st March
2015 2014 2015 2014
Sales and Other Income 23,956 21,494 45,831 42,254
Profit before Interest,
Depreciation, 11,332 9,307 12,751 10,841
Exceptional Expenses
& Tax [PBIDET]
Less: Depreciation 455 243 773 465
Profit before Interest,
Exceptional Expenses 10,877 9,064 11,978 10,376
& Tax (PBIET)
Less: Interest 5 4 13 13
Profit Before Tax [PBT] 10,872 9,060 11,965 10,363
Less: Provision for Tax -23 -585 850 532
Profit After Tax [PAT] 10,895 9,645 11,115 9,831
Less: Minority Interest - - 220 186
Profit attributable to
shareholders 10,895 9,645 10,895 9,645
Add: Profit brought
forward from 24,149 18,247 24,149 18,247
the previous year
Less: Additional
depreciation upon 26 0 26 0
revision in useful
lives of tangible assets
Profit available for
appropriation, 35,018 27,892 35,018 27,892
which is appropriated
as follows:
Proposed Final Dividend 2,344 2,344 2,344 2,344
Corporate Dividend Tax
on Dividend 477 399 477 399
Transfer to General Reserve 0 1,000 0 1,000
Balance carried to
Balance Sheet 32,197 24,149 32,197 24,149
Total 35,018 27,892 35,018 27,892
Basic and Diluted
Earning Per Share 27.88 24.69 27.88 24.69
(EPS of FV Rs. 10/-)
[in Rupees]
The Company proposes to retain an amount of Rs. 32,197 lacs in the
Statement of Profit and Loss.
The consolidated financial highlights include the financials of Zydus
Wellness, Sikkim, a partnership firm. Results of operations:
During the year under review, the consolidated gross sales grew by
3.1%. On standalone basis, the Company has earned total revenue of Rs.
23,956 lacs. The PBIDT increased by 21.8 % to Rs. 11,332 lacs and the
Profit Before Tax increased by 20% to Rs. 10,872 lacs. The Profit after
Tax has increased to Rs. 10,895 lacs as compared to Rs. 9,645 lacs in
the previous year and the EPS has increased from Rs. 24.69 in the
previous year to Rs. 27.88. A detailed analysis of performance for the
year has been included in the Management Discussion and Analysis, which
forms part of the Annual Report.
Dividend:
Your Directors have recommended a dividend of Rs. 6/- [i.e. 60%] per
equity share [last year Rs. 6/- per equity share] on 3,90,72,089 equity
shares of Rs. 10/- each fully paid-up for the financial year ended on
31st March, 2015, amounting to Rs. 2,821 lacs [inclusive of corporate
dividend tax of Rs. 477 lacs]. The dividend, if declared by the
shareholders at the ensuing Annual General Meeting, will be paid to
those shareholders, whose names stand registered in the Register of
Members as on 29th July, 2015. In respect of shares held in
dematerialized form, it will be paid to the members whose names are
furnished by the National Securities Depository Limited and the Central
Depository Services [India] Limited, as beneficial owners. The Dividend
Payout ratio for the current year (inclusive of Corporate Dividend Tax)
is 25.90 percent on profits.
During the year, the unclaimed dividend pertaining to the dividend for
the year ended 31st March, 2007 was transferred to Investor Education
and Protection Fund.
Management Discussion and Analysis [MDA]:
MDA, for the year under review, as stipulated under clause 49 of the
Listing Agreement, is presented in a separate section forming part of
this Annual Report.
Consolidated Financial Statements:
Zydus Wellness, Sikkim [ZWS] is under the majority control of the
Company and hence the accounts of ZWS are consolidated with the
accounts of the Company in accordance with the provisions of Accounting
Standard [AS]- 21 on Consolidated Financial Statements issued by the
Institute of Chartered Accountants of India, Companies Act, 2013
["Act"] read with Schedule III of the Act and Rules made thereunder and
the Listing Agreement with the Stock Exchanges. The audited
Consolidated Financial Statements are provided in this Annual Report.
Though Company does not have any subsidiary Company, in compliance of
the provisions of clause 49 of the Listing Agreement, the Company has
formed a policy relating to material subsidiaries, which is approved by
the Board of Directors and can be accessed on the Company''s website at
the link: http://www.zyduswellness.in/
investor/Policy%20on%20Material%20Subsidiary-May15.pdf
Related Party Transactions:
All 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
transactions with related parties which could be considered as material
in accordance with the policy of the Company on materiality of related
party transactions.
The Policy on materiality of related party transactions and dealing
with related party transactions as approved by the Board may be
accessed on the Company''s website at the link:
http://www.zyduswellness.in/investor/
Policy%20on%20Related%20Party%20Transactions-May15.pdf. Disclosures on
related party transactions are set out in Note No. 34 to the financial
statements.
Directors:
i. Cessation:
Mr. Mukesh M. Patel [DIN-00053892], Director and Mr. Elkana N. Ezekiel
[DIN-05201713], Managing Director of the Company have resigned with
effect from 14th July, 2014 and 14th April, 2015 respectively.
The Board places on record its appreciation for contributions and
guidance provided by Mr. Patel and Mr. Ezekiel during their respective
tenure as a Director / Managing Director of the Company.
ii. Retirement by rotation:
In accordance with the provisions of section 152[6] of the Act and in
terms of Articles of Association of the Company, Dr. Sharvil P. Patel
[DIN-00131995] will retire by rotation at the ensuing Annual General
Meeting and being eligible, offer himself for reappointment. The Board
recommends his reappointment.
iii. Appointment of Additional / Whole Time Director:
Mr. Tarun G. Arora was appointed as an Additional Director and Whole
Time Director w.e.f. 14th May, 2015, subject to the approval of the
Members at the ensuing Annual General Meeting. Mr. Tarun Arora is
designated as the Key Managerial Personnel pursuant to the provisions
of section 203 of the Act.
iv. Independent Directors:
The Independent Directors have submitted their declarations of
independence, as required pursuant to the provisions of section 149(7)
of the Act, stating that they meet the criteria of independence as
provided in section 149[6].
v. Profile of the Directors seeking appointment / reappointment:
As required under clause 49 of the Listing Agreement, particulars of
the Directors retiring by rotation and seeking appointment /
reappointment at the ensuing Annual General Meeting is annexed to the
notice convening 21st Annual General Meeting.
vi. Chairman:
Upon cessation of Mr. Pankaj R. Patel [DIN-00131852] as the Director of
the Company, Dr. Sharvil P. Patel was appointed as the Chairman of the
Board and Company w.e.f. 14th July, 2014.
vii. Key Managerial Personnel:
The following persons were designated as Key Managerial Personnel:
1. Mr. Elkana N. Ezekiel, Managing Director, [up to 14th April, 2015]
2. Mr. Tarun G. Arora, Whole Time Director. [w.e.f. 14th May, 2015],
3. Mr. Amit B. Jain, Chief Financial officer and
4. Mr. Dhaval N. Soni, Company Secretary
viii. Board Evaluation:
Pursuant to the provisions of the Act and Rules made thereunder and as
provided under Schedule IV of the Act and clause 49 of the Listing
Agreement, the Board has carried out the annual performance evaluation
of itself, the Directors individually as well as the evaluation of its
committees. The manner in which the evaluation was carried out is
provided in the Corporate Governance Report, which is part of this
Annual Report.
ix. Remuneration Policy:
The Board has on the recommendations of Nomination and Remuneration
Committee, framed a Policy on selection and appointment of Directors,
Senior Management and their remuneration. The Remuneration Policy is
stated in the Corporate Governance Report, which is part of this Annual
Report.
Directors'' Responsibility Statement:
In terms of section 134[3][c] of the Act, your Directors state that:
i. in the preparation of the annual financial statements for the year
ended on 31st March, 2015, applicable accounting standards read with
requirements set out under schedule III of the Act, have been followed
along with proper explanation relating to material departures, if any,
ii. such accounting policies have been selected and applied
consistently and judgments and estimates made that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the company as at 31st March, 2015 and of the profit of the company for
the year ended on that date,
iii. proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of this
Act for safeguarding the assets of the company and for prevention and
detection of fraud and other irregularities,
iv. the annual financial statements are prepared on a going concern
basis,
v. proper internal financial controls are in place and that the
financial controls are adequate and are operating effectively and
vi. the systems to ensure compliance with the provisions of all
applicable laws are in place and are adequate and operating
effectively.
Board Meetings:
A calendar of meetings to be held in a year is decided in advance by
the Board and circulated to the Directors. During the year, four Board
and four Audit Committee Meetings were convened and held, the details
of which are provided in the Corporate Governance Report, forming part
of the Directors'' Report. The gap between two consecutive meetings was
not more than one hundred and twenty days as provided in section 173 of
the Act.
Corporate Governance:
The Company has complied with the Corporate Governance requirements
under the Act and as stipulated under clause 49 of the Listing
Agreement. A separate section on detailed report on the Corporate
Governance practices followed by the Company under the Listing
Agreement along with a certificate from M/s. Hitesh Buch & Associates,
Practicing Company Secretary, confirming the compliance, is part of the
Annual Report.
Auditors:
i. Statutory Auditor and their Report:
M/s. Dhirubhai Shah & Doshi, Chartered Accountants, [Firm Registration
No. 102511W] Statutory Auditor of the Company hold office until the
conclusion of the ensuing 21st Annual General Meeting and are eligible
for reappointment. Pursuant to provisions of section 139 of the
Companies Act, 2013 and the Rules made thereunder, the Board proposes
to reappoint M/s. Dhirubhai Shah & Doshi, Chartered Accountants as
Statutory Auditor of the Company from the conclusion of the ensuing
21st Annual General Meeting till the conclusion of 26th Annual General
Meeting. They have furnished a certificate confirming the eligibility
under section 141 of the Companies Act, 2013 and Rules made thereunder.
The Board based on the recommendation of Audit Committee, recommends
the reappointment of M/s. Dhirubhai Shah & Doshi, Chartered
Accountants, as the Statutory Auditor of the Company.
The Board has duly reviewed the Statutory Auditor''s Report on the
Accounts. The observations and comments, appearing in the Auditor''s
Report are self-explanatory and do not call for any further explanation
/ clarification by the Board of Directors as provided under section 134
of the Act.
ii. Cost Auditor:
Pursuant to the provisions of section 148[3] of the Act read with The
Companies [Cost Records and Audit] Amendment Rules, 2014, the cost
audit records maintained by the Company in respect of its product
"Nutralite" is required to be audited. The Board had, on the
recommendation of Audit Committee, appointed M/s. Dalwadi & Associates,
Cost Accountants [Firm Registration No. 000338] to audit the cost
records of product "Nutralite" for the financial year ended on 31st
March, 2016 on a remuneration of Rs. 1.80 lacs. As required under the
Act and Rules made thereunder, the remuneration payable to the Cost
Auditor is required to be placed before the Members at a General
Meeting for ratification. Accordingly, a resolution to ratify the
remuneration payable to M/s. Dalwadi & Associates for the financial
year ending on 31st March, 2016 is included at Item No. 8 of the Notice
convening 21st Annual General Meeting.
iii. Secretarial Auditor and Secretarial Audit Report:
Pursuant to the provisions of section 204 of the Act and The Companies
[Appointment and Remuneration of Managerial Personnel] Rules, 2014, the
Company has appointed M/s. Hitesh Buch & Associates, Practicing Company
Secretary to undertake Secretarial Audit for the financial year ended
on 31st March, 2015. Secretarial Audit Report is attached to this
report as Annexure-"A". The Board has duly reviewed the Secretarial
Auditor''s Report and the observations and comments, appearing in the
report are self-explanatory and do not call for any further explanation
/ clarification by the Board of Directors as provided under section 134
of the Act.
Corporate Social Responsibility [CSR]:
The Board of Directors of the Company has constituted a Corporate
Social Responsibility [CSR] Committee under the Chairmanship of Dr.
Sharvil P. Patel. Other members of the Committee are Mr. Ganesh N.
Nayak and Prof. Indiraben J. Parikh. CSR Committee has recommended to
the Board, a CSR Policy, indicating the activities to be undertaken by
the Company, which is approved by the Board. The CSR Policy is posted
on the website of the Company.
As part of its initiatives under Corporate Social Responsibility [CSR],
the Company has contributed for healthcare, education and research in
cancer and for eradicating poverty and malnutrition for the year under
review. Other details of the CSR activities as required under section
135 of the Act are given in the CSR Report at Annexure-"B".
Business Risk Management:
A well-defined risk management mechanism covering the risk mapping and
trend analysis, risk exposure, potential impact and risk mitigation
process is in place. The objective of the mechanism is to minimize the
impact of risks identified and taking advance actions to mitigate it.
The mechanism works on the principles of probability of occurrence and
impact, if triggered. A detailed exercise is being carried out to
identify, evaluate, monitor and manage both business and non-business
risks.
Discussion on risks and concerns are covered in the Management
Discussion and Analysis Report, which forms part of this Annual Report.
Internal control systems and its adequacy:
The Company has internal control systems commensurate with the size,
scale and complexity of its business operations. The scope and
functions of internal auditor are defined and reviewed by the Audit
committee. The internal auditor reports to the Chairman of the Audit
Committee. Internal Auditors presents their quarterly report to the
Audit Committee, highlighting various observations, system and
procedure lapses and corrective actions are taken. The internal auditor
also assesses opportunities for improvement of business processes,
systems and controls, to provide recommendations, which can add value
to the organization and it also follows up on the implementation of
corrective actions and processes. The Management Auditor also ensures
the compliance of the observations of internal and statutory auditors
and presents his report to the Audit Committee.
Managing the Risks of fraud, corruption and unethical business
practices:
i. Vigil Mechanism / Whistle Blower Policy:
The Company has established vigil mechanism and framed whistle blower
policy for Directors and employees to report concerns about unethical
behavior, actual or suspected fraud or violation of Company''s Code of
Conduct or Ethics Policy. Whistle Blower Policy is disclosed on the
website of the Company.
ii. Zydus Business Conduct Policy:
The Company has framed "Zydus Business Conduct Policy". Every employee
is required to review and sign the policy at the time of joining and an
undertaking shall be given for adherence to the Policy. The objective
of the Policy is to conduct the business in an honest, transparent and
in an ethical manner. The policy provides for anti-bribery and
avoidance of other corruption practices by the employees of the
Company.
Extract of Annual Return:
The relevant information in prescribed Form No. MGT-9 pertaining to
extract of Annual Return is attached to this Report as Annexure-"C".
Constitution of Audit Committee:
The Board has reconstituted the Audit Committee which comprises of Mr.
H. Dhanrajgir as the Chairman and Dr. B. M. Hegde, Prof. Indiraben J.
Parikh and Mr. Ganesh N. Nayak as the members. More details on the
Committee are given in the Corporate Governance Report.
Particulars of Employees:
The information required under section 197 of the Act read with Rule
5[1] of The Companies [Appointment and Remuneration of Managerial
Personnel] Rules, 2014 are given in Annexure-"D".
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo:
Information on conservation of energy, technology absorption, foreign
exchange earnings and outgo, as required to be disclosed under section
134[3][m] of the Act read with the Companies [Accounts] Rules, 2014,
are provided in the Annexure-"E" and forms part of this Report.
General Disclosure:
Your Directors state that the Company has made disclosures in this
report for the items prescribed in section 134[3] of the Act and Rule 8
of The Companies [Accounts] Rules, 2014 to the extent the transactions
took place on those items during the year.
Acknowledgement:
Your Directors wish to place on record their sincere appreciation for
significant contributions made by the employees at all levels through
their dedication, hard work and commitment, enabling the Company to
achieve good performance during the year under review.
Your Directors also take this opportunity to place on record the
valuable co-operation and support extended by the banks, government,
business associates and the shareholders for their continued confidence
reposed in the Company and look forward to having the same support in
all future endeavors.
For and on behalf of the Board
Place : Ahmedabad Sharvil P. Patel
Date : 14th May, 2015 Chairman
Mar 31, 2013
To The Members of Zydus Wellness Limited
The directors have pleasure in presenting 19th Annual Report of the
Company along with the Audited Accounts for the financial year ended
31st March, 2013. The summarised financial results are given below:
Financial Highlights:
[INR Lacs]
Particulars Consolidated 2012-13 2011-12
Sales and Other Income 40,378 34,576
Profit before Interest, Depreciation, Exceptional
Expenses & Tax [PBIDET] 11,246 8,625
Less : Depreciation 450 386
Profit before Interest, Exceptional Expenses
& Tax (PBIET) 10,796 8,239
Less : Interest 10 15
Profit Before Tax [PBT] 10,786 8,224
Less: Provision for Tax 883 1,365
Profit After Tax [PAT] 9,903 6,859
Less : Minority Interest 192 91
Profit attributable to shareholders 9,711 6,768
Add : Profit brought forward from the previous year 12,279 8,682
Profit available for appropriation, which is
appropriated as follows: 21,990 15,450
Interim Dividend 2,344 0
Proposed Final Dividend 0 1,954
Corporate Dividend Tax on Dividend 399 317
Transferred to General Reserve 1,000 900
Balance carried to Balance Sheet 18,247 12,279
Total 21,990 15,450
Basic and Diluted Earning Per Share (EPS of FV Rs. 10/-) [in Rupees]
24.85 17.32
The consolidated financial highlights include the financials of Zydus
Wellness-Sikkim, a partnership firm.
Performance Review:
For the year ended on 31st March, 2013, the sales and other income of
the Company, on consolidated basis, have increased by 16.78% to Rs.
40,378 lacs compared to Rs. 34,576 lacs in the previous year. Profit
before Interest, Exceptional Expenses & Tax increased by 31.04% to Rs.
10,796 lacs compared to Rs. 8,239 lacs in the previous year. The Profit
After Tax increased by 44.38% to Rs. 9,903 lacs compared to Rs. 6,859
lacs in the previous year.
The Company achieved EPS of Rs. 24.85 compared to Rs. 17.32 in the
previous year. The summary of performance of the business of the
Company is provided in the Management Discussion and Analysis Report
[MDA] forming part of this Annual Report.
Dividend:
The Board of Directors at its meeting held on 13th May, 2013 declared
an interim dividend of Rs. 6/- [@ 60%] [previous year final dividend of
Rs. 5/- (@ 50%)] on 3,90,72,089 Equity Shares of Rs. 10/- each fully
paid-up amounting to Rs. 2,743 lacs [inclusive of dividend distribution
tax of Rs. 399 lacs]. Interim Dividend was paid to those shareholders
holding shares in electronic form, whose names appeared in the list of
beneficiaries provided by the Depositories as on 23rd May, 2013 being
the Record Date fixed by the Board of Directors for the purpose and to
those shareholders holding shares in physical form as on the Record
Date.
The dividend payout ratio for the current year [inclusive of corporate
tax on dividend distribution] is 28.24%.
Awards & Recognition:
Mr. Amit B. Jain, Chief Financial Officer, was declared winner of
CF0100 Roll of Honour 2013, in the category of "Winning Edge in Growth"
by CFO India, a magazine meant for CFOs of India.
Consolidated Financial Statements:
Zydus Wellness-Sikkim [ZWS] is under the majority control of the
Company and hence the accounts of ZWS are required to be consolidated
with the accounts of the Company in accordance with the Accounting
Standard AS-21 on Consolidation of Financial Statements issued by the
Institute of Chartered Accountants of India. The audited Consolidated
Financial Statements are provided in this Annual Report.
Board of Directors:
In accordance with the provisions of the Companies Act, 1956 read with
Articles of Association of the Company, Prof. Indiraben J. Parikh, Mr.
Mukesh M. Patel and Dr. Sharvil P. Patel, Directors retire by rotation
at the ensuing Annual General Meeting and being eligible offer
themselves for re-appointment. The Board recommends their re-
appointment.
In accordance with the stipulation under clause 49 of the Listing
Agreement, brief resume of the Directors seeking re-appointment at the
ensuing Annual General Meeting together with the nature of their
expertise in specific functional areas and names of companies in which
they hold office as Director and / or Chairman / Member of Committees
of the Board is annexed to the notice.
Auditors:
M/s Manubhai & Co., Chartered Accountants, the Statutory Auditors of
the Company have expressed their unwillingness for re-appointment at
the ensuing Annual General Meeting. The Board of Directors has
recommended the appointment of M/s. Dhirubhai Shah & Co., [Firm
Registration No. 102511W] Chartered Accountants as the Statutory
Auditors of the Company to hold office from the conclusion of the
ensuing Annual General Meeting till the conclusion of the next Annual
General Meeting and to fix their remuneration.
The Company has received a letter from M/s. Dhirubhai Shah & Co.,
Chartered Accountants under the provisions of section 224[1B] of the
Companies Act, 1956 expressing their willingness for appointment as the
Statutory Auditors, if made by the members will be within the statutory
limits prescribed.
Auditors'' Report and Notes to Accounts:
The Board has duly reviewed the Statutory Auditors'' Report on the
Accounts. The Auditors'' Report is self- explanatory and do not call for
any further explanation / clarification by the Board of Directors under
section 217[3] of the Companies Act, 1956.
Disclosures:
There have been no material changes and commitments, which may affect
the financial position of the Company between the end of the financial
year and the date of this report.
Management Discussion and Analysis [MDA]:
MDA for the year under review, as stipulated under clause 49 of the
Listing Agreement is presented in a separate section forming part of
this Annual Report.
Directors'' Responsibility Statement:
Your Directors affirm that the audited accounts containing the
financial statements for the Financial Year 2012- 2013 are in
conformity with the requirements of the Companies Act, 1956. They
believe that the financial statements reflect fairly the form and
substance of transactions carried out during the year and reasonably
present the Company''s financial conditions and results of operations.
Pursuant to section 217[2AA] of the Companies Act, 1956 the Directors
confirm that:
(a) the Annual Accounts for the year ended on 31st March, 2013 have
been prepared on a going concern basis;
(b) in preparation of the Annual Accounts, the applicable Accounting
Standards have been followed. Necessary explanations are given for
material departures, if any;
(c) sound accounting policies have been applied consistently and
judgments and estimates made that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as on
31st March, 2013 and of the profit of the Company for the year ended on
that date and
(d) proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the company and for
prevention and detection of fraud and other irregularities.
Corporate Governance:
The Company is committed to maintain highest standards of Corporate
Governance. Your Directors adhere to the requirements as provided in
clause 49 of the Listing Agreement relating to Corporate Governance.
A detailed report on the Corporate Governance, together with a
certificate from Practicing Company Secretary, confirming compliance
with the conditions of Corporate Governance, forms part of this report.
Cost Auditors:
The central government has directed an audit of the cost accounts
maintained by the Company in respect of products-Nutralite and
Mayonnaise. For conducting the cost audit for these activities for the
financial year ended on 31st March, 2013, based on the recommendation
of the Audit Committee, the Board had appointed M/s. Dalwadi &
Associates and made an application to the Central Government in
accordance with MCA Circular dated 11th April, 2011. The Cost Auditor
has filed the Compliance Report for the financial year ended on 31st
March, 2012 within the due date on 24th December, 2012. The due date of
filing the Compliance Report was 28th February, 2013.
Personnel:
There was no employee drawing remuneration in excess of limits
prescribed under section 217[2A] of the Companies Act, 1956 and
Companies [Particulars of Employees] Rules, 1975 and therefore not
applicable to the Company.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo:
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed 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 are provided in the Annexure-A to this Report.
Acknowledgement:
Your Directors wish to place on record their sincere appreciation for
significant contributions made by the employees at all levels through
their dedication, hard work and commitment, enabling the Company to
achieve good performance during the year under review.
Your Directors also take this opportunity to place on record the
valuable co-operation and support extended by the banks, government,
business associates and the shareholders for their continued confidence
reposed in the Company and look forward to having the same support in
all future endeavors.
For and on behalf of the Board
Place : Ahmedabad. Pankaj R. Patel
Date : 31st May, 2013. Chairman
Mar 31, 2012
To The Members of Zydus Wellness Limited
The directors have pleasure in presenting 18th Annual Report of the
Company along with the Audited Accounts for the financial year ended
31st March, 2012. The summarised financial results are given below:
Standalone Consolidated Financial Highlights:
[INR Lacs]
Particulars Standalone Consolidated
2011-12 2010-11 2011-12 2010-11
Sales and Other Income 26240 34358 34046 34358
Profit before Interest,
Depreciation,
Exceptional Expenses &
Tax [PBIDET] 8102 9161 8625 9161
Less: Depreciation 230 149 386 149
Profit before Interest,
Exceptional Expenses
& Tax [PBIET] 7872 9012 8239 9012
Less: Interest 11 16 15 16
Profit Before Tax [PBT] 7861 8996 8224 8996
Less: Provision for Tax 1093 3048 1365 3048
Profit After Tax [PAT] 6768 5948 6859 5948
Less: Minority Interest - - 91 -
Profit Attributable to
Shareholders 6768 5948 6768 5948
Add: Profit brought
forward from the
previous year 8682 5196 8682 5196
Profit available for
appropriation, which is
appropriated as follows: 15450 11144 15450 11144
Proposed Dividend 1954 1563 1954 1563
Corporate Dividend Tax
on Proposed Dividend 317 254 317 254
Transferred to General
Reserve 900 645 900 645
Balance carried to
Balance Sheet 12279 8682 12279 8682
Total 15450 11144 15450 11144
Basic and Diluted
Earnings Per Share
[EPS of FV Rs. 10/-]
[in Rupees]
- Before Exceptional items 17.32 15.22 17.32 15.22
- After Exceptional items 17.32 15.22 17.32 15.22
The consolidated financial highlights include the financials of Zydus
Wellness-Sikkim, a partnership firm as its operations were started
during the year under review and therefore the current year's figures
are not strictly comparable to those of the previous year.
Performance Review:
The year 2011-2012 was another challenging year for the Indian markets.
The continued high level of food inflation along with the firming up of
commodity costs has led to an inflationary business environment. Your
Company performed creditably in a difficult year maintaining market
leaderships in key brands.
The Company earned on consolidated basis total income of Rs. 34,046
lacs during the year. The profit before tax stood at Rs. 8,224 Lacs for
the year ended on 31st March, 2012. The profit after tax was up by Rs.
911 lacs due to lower tax burden. As a result the Earning per Share has
increased to Rs. 17.32 as compared to Rs. 15.22 in the previous year.
The summary of performance of the business of the Company is provided
in the Management Discussion and Analysis Report [MDA] forming part of
this Annual Report.
Dividend:
Your Directors are pleased to recommend a dividend of Rs. 5/- per
Equity Share of face value of Rs. 10/- each fully paid-up [previous
year Rs. 4/- per share] for the financial year ended on 31st March,
2012, amounting to Rs. 2,271 lacs [inclusive of Dividend Distribution
Tax of Rs. 317 lacs]. The dividend, if declared by the shareholders at
the ensuing Annual General Meeting will be paid to those shareholders,
whose names stand registered in the Register of Members as on 27th
July, 2012. In respect of shares held in dematerialized form, dividend
will be paid to those shareholders whose names are furnished by NSDL &
CDSL, as beneficial owners.
The dividend payout ratio for the current year [inclusive of corporate
tax on dividend distribution] is 33.55%.
Awards & Recognition:
Mr. Amit B. Jain, Chief Financial Officer, bagged the Business
Today-YES BANK Best CFO Award 2012 in the category of Consistent
Liquidity Management [Midsize Companies].
Consolidated Financial Statements:
M/s. Zydus Wellness-Sikkim [ZWS], a partnership firm has commenced its
commercial production during the year. As ZWS is under the majority
control of the Company, the accounts of ZWS are required to be
consolidated with the accounts of the Company in accordance with the
Accounting Standard AS-21 on Consolidation of Financial Statements
issued by the Institute of Chartered Accountants of India. The audited
Consolidated Financial Statements are provided in this Annual Report.
Board of Directors:
In accordance with the provisions of the Companies Act, 1956 ["the
Act"] read with Articles of Association of the Company, Mr. Ganesh N.
Nayak, Mr. Pankaj R. Patel and Dr. B. M. Hegde, Directors retire by
rotation at the ensuing Annual General Meeting and being eligible offer
themselves for re-appointment. The Board recommends their
re-appointment.
During the year Mr. Anand G. Deo, Managing Director, resigned from the
services of the Company and also ceased to be a Director on the Board
of the Company w.e.f. 14th February, 2012. The Board wishes to place on
record its appreciation for his valuable contribution during his long
association with the Company.
Mr. Elkana N. Ezekiel was appointed as an Additional Director pursuant
to section 260 of the Act, w.e.f. 14th February, 2012, who shall hold
the office up to the date of the ensuing Annual General Meeting. The
Company has received a notice in writing from a member along with a
deposit of Rs. 500/- pursuant to the provisions of section 257 of the
Act, proposing his candidature for the office of Director. The Board
recommends appointment of Mr. Ezekiel as Director.
Further, Mr. Ezekiel was appointed as Managing Director of the Company
for a period of 5 years from 14th February, 2012, which is subject to
approval of the shareholders at the ensuing Annual General Meeting, on
the terms and conditions as contained in the draft agreement proposed
to be entered into between the Company and the Managing Director. An
abstract of notice of memorandum of interest dated 14th February, 2012
was send to all the shareholders of the Company, as required under
section 302 of the Act.
In accordance with the stipulation under clause 49 of the Listing
Agreement, brief resume of the Directors seeking
appointment/re-appointment at the ensuing Annual General Meeting
together with the nature of their expertise in specific functional
areas and names of companies in which they hold office as Director
and/or Chairman/Member of Committees of the Board is annexed to the
notice.
Auditors:
M/s Manubhai & Co. [Firm Registration No. 106041W], Chartered
Accountants, Statutory Auditors of the Company, hold office till the
conclusion of the ensuing Annual General Meeting and are eligible for
re-appointment. The Statutory Auditors have shown their willingness to
accept the office on re-appointment.
The Company has received a letter from the Statutory Auditors to the
effect that their re-appointment, if made, would be within the
prescribed limits under section 224[1B] of the Act and that they are
not disqualified for re- appointment within the meaning of section 226
of the Act.
The necessary resolution seeking approval of members for re-appointment
of Statutory Auditors has been provided in the Notice convening the
Annual General Meeting.
Auditors' Report and Notes to Accounts:
The Board has duly reviewed the Statutory Auditors' Report on the
Accounts. The Auditors' Report is self- explanatory and do not call for
any further explanation/clarification by the Board of Directors under
section 217[3] of the Act.
Disclosures:
There have been no material changes and commitments, which may affect
the financial position of the Company between the end of the financial
year and the date of the report.
Management Discussion and Analysis [MDA]:
MDA for the year under review, as stipulated under clause 49 of the
Listing Agreement is presented in a separate section forming part of
this Annual Report.
Directors' Responsibility Statement:
Your Directors affirm that the audited accounts containing the
financial statements for the Financial Year 2011- 2012 are in
conformity with the requirements of the Act. They believe that the
financial statements reflect fairly the form and substance of
transactions carried out during the year and reasonably present the
Company's financial conditions and results of operations.
Pursuant to section 217[2AA] of the Act, the Directors confirm that:
[a] the Annual Accounts for the year ended on 31st March, 2012 have
been prepared on a going concern basis;
[b] in preparation of the Annual Accounts, the applicable accounting
standards have been followed. Necessary explanations are given for
material departures, if any;
[c] sound accounting policies have been applied consistently and
judgments and estimates made that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as on
31st March, 2012 and of the profit of the Company for the year ended on
that date and
[d] proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Act for safeguarding the assets of the company and for prevention and
detection of fraud and other irregularities.
Corporate Governance:
The Company is committed to maintain highest standards of Corporate
Governance. Your Directors adhere to the requirements as provided in
clause 49 of the Listing Agreement relating to Corporate Governance.
A detailed report on the Corporate Governance, together with a
certificate from Practicing Company Secretary, confirming compliance
with the conditions of Corporate Governance, forms part of this report.
Personnel:
There was no employee drawing remuneration in excess of limits
prescribed under section 217[2A] of the Act and Companies [Particulars
of Employees] Rules, 1975 and therefore not applicable to the Company.
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo:
The particulars relating to energy conservation, technology absorption,
foreign exchange earnings and outgo, as required to be disclosed under
section 217[1][e] of the Act read with the Companies [Disclosure of
Particulars in the Report of Board of Directors] Rules, 1988 are
provided in the Annexure-A to this Report.
Acknowledgement:
Your Directors wish to place on record their sincere appreciation for
significant contribution made by the employees at all levels through
their dedication, hard work and commitment, enabling the Company to
achieve good performance during the year under review.
Your Directors also take this opportunity to place on record the
valuable co-operation and continued support extended by the banks,
government, business associates and the shareholders for their
continued confidence reposed in the Company and look forward to having
the same support in all future endeavors.
For and on behalf of the Board
Place : Ahmedabad. Pankaj R. Patel
Date : 9th May, 2012. Chairman
Mar 31, 2011
The directors have pleasure in presenting SEVENTEENTH Annual Report of
the Company along with the Audited statement of accounts for the year
ended 31st March, 2011. The summarised financial results are given
below:
Financial Highlights:
INR - Lacs
For the year ended 31st March 2011 2010 Growth (%)
Sales and Other Income 34358 27402 25.4
Profit before Interest,
Depreciation, Exceptional
expenses & Tax (PBIDET) 9161 7319 25.2
Less : Depreciation 149 159 (6.3)
Profit before Interest,
Exceptional expenses &
Tax (PBIET) 9012 7160 25.9
Less : Interest 16 9 77.8
Expenses incurred on
Composite Scheme of
Arrangement 0 220
Profit Before Tax (PBT) 8996 6931 29.8
Less : Provision for Tax 3048 2404 26.8
Profit After Tax (PAT) 5948 4527 31.4
Add : Profit brought forward
from the previous year 5196 2491
Profit available for appropriation,
which is appropriated as follows: 11144 7018
Proposed Dividend 1563 1172
Corporate Dividend Tax on
Proposed Dividend 254 195
Transferred to General Reserve 645 455
Balance carried to Balance Sheet 8682 5196
Total 11144 7018
Basic and Diluted Earnings per
share (EPS of FV Rs. 10/-)
[in Rupees]
- Before Exceptional items 15.22 12.15
- After Exceptional items 15.22 11.59
Performance Review:
For the year ended on 31st March, 2011, the sales and other income of
the Company have increased by 25.4% to Rs. 34358 lacs as compared to
Rs. 27402 lacs in the previous year. Profit before Interest,
Depreciation, Exceptional items & Tax increased to Rs. 9161 lacs
compared to Rs. 7319 lacs in the previous year. The Profit after Tax
increased to Rs. 5948 lacs compared to Rs. 4527 lacs in the previous
year. The Company achieved EPS (after exceptional items) of Rs. 15.22
compared to Rs. 11.59 in 2009Ã10. A detailed analysis of performance
for the year has been included in the Management Discussion and
Analysis, which forms part of the Annual Report.
Dividend:
With the Group celebrating the achievement of crossing the Billion
Dollar mark in its revenues, your Directors are pleased to recommend an
increased dividend of Rs. 4/- per equity share (40%) compared to Rs.
3/- per equity share in the previous year, on 39,072,089 equity shares
of Rs. 10/- each fully paid up for the financial year ended on 31st
March, 2011. The dividend, if declared by the shareholders at the
ensuing Annual General meeting, will be paid to those shareholders,
whose names stand registered in the Register of Members as on 30th
June, 2011.
Depository System:
As the members are aware, the CompanyÃs shares are compulsorily
tradable in electronic form. As on 31st March, 2011, 98.89% of the
CompanyÃs total paidÃup capital representing 38,637,554 equity shares
is in dematerialized form. In view of the many advantages offered by
the Depository System, members holding shares in physical mode are
advised to avail the facility of dematerialization on either of the
Depositories.
Awards and Recognition:
Your Company was listed amongst AsiaÃs 200 Best Under a Billion
Companies by Forbes. The manufacturing plant of the Company at Moraiya
has been certified by ISO 22000:2005 for Food Safety Management System
and ISO 14001:2004 for Environment Management Safety.
Fixed Deposits:
Your Company does not accept or hold any fixed deposits pursuant to
provisions of section 58A of the Companies Act, 1956.
Board of Directors:
In accordance with the provisions of the Companies Act, 1956 (Ãthe
ActÃ) read with Articles of Association of the Company, Mr. Mukesh M.
Patel, Mr. H. Dhanrajgir and Dr. Sharvil P. Patel, Directors retire by
rotation at the ensuing Annual General Meeting and being eligible offer
themselves for reappointment. The Board recommends their
reÃappointment.
In accordance with the stipulation under clause 49 of the Listing
Agreement, brief resume of the Directors seeking reÃappointment at the
ensuing Annual General Meeting together with the nature of their
expertise in specific functional areas and names of companies in which
they hold office as Director and / or Chairman / Member of Committees
of the Board is annexed to the notice.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings & Outgo:
The particulars required to be disclosed pursuant to section 217(1)(e)
of the Companies Act, 1956, read with the Companies (Disclosures of
Particulars in the Report of Board of Directors) Rules, 1988, are given
to the extent applicable in the AnnexureÃÃAÃ, forming part of this
Report.
Auditors:
Yours CompanyÃs Statutory Auditors, M/s. Manubhai & Co., Chartered
Accountants, retire at the conclusion of the ensuing Annual General
Meeting. The Statutory Auditors have confirmed their eligibility and
willingness to accept the office on reÃappointment. The necessary
resolution seeking approval of members for reÃappointment of Statutory
Auditors has been provided in the Notice convening the Annual General
Meeting.
Auditorsà Report and Notes to Accounts:
The Board has duly reviewed the Statutory Auditorsà Report on the
Accounts. The Auditorsà Report is selfà explanatory and do not call for
any further explanation / clarification by the Board of Directors under
section 217(3) of the Companies Act, 1956.
Internal Audit:
During the year under review, the Company has engaged the services of
M/s. Kantilal Patel & Co., Chartered Accountants, Ahmedabad as Internal
Auditors to carry out internal audit on regular basis. The reports of
the internal audit are presented for review before the Audit Committee.
The Audit Committee also scrutinizes all the programmes and adequacy of
the internal audits.
Disclosures:
There have been no material changes and commitments, which may affect
the financial position of the Company between the end of the financial
year and the date of the report.
Management Discussion and Analysis (MDA):
The Management Discussion and Analysis Report for the year under
review, as stipulated under clause 49 of the Listing Agreement is
presented in a separate section forming part of this Annual Report.
Directorsà Responsibility Statement:
Your Directors affirm that the audited accounts containing the
financial statements for the Financial Year 2010Ã 2011 are in
conformity with the requirements of the Companies Act, 1956. They
believe that the financial statements reflect fairly the form and
substance of transactions carried out during the year and reasonably
present the CompanyÃs financial conditions and results of operations.
Pursuant to section 217(2AA) of the Companies Act, 1956, the Directors
confirm that:
(a) the Annual Accounts for the year ended on 31st March 2011 have been
prepared on a going concern basis;
(b) in preparation of the Annual Accounts, the applicable accounting
standards have been followed. Necessary explanations are given for
material departures, if any;
(c) sound accounting policies have been applied consistently and
judgments and estimates made that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as on
31st March, 2011 and of the profit of the Company for the year ended on
that date and
(d) proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the company and for
prevention and detection of fraud and other irregularities.
Corporate Governance:
The Company is committed to maintain highest standards of Corporate
Governance. Your Directors adhere to the requirements as provided in
clause 49 of the Listing Agreement relating to Corporate Governance.
A detailed report on the Corporate Governance, together with a
certificate from M/s. Hitesh Buch & Associates, Practicing Company
Secretaries, confirming compliance with the conditions of Corporate
Governance, forms part of this report.
Personnel:
There was no employee drawing remuneration in excess of limit
prescribed under section 217 (2A) of the Companies Act, 1956 and
Companies (Particulars of Employees) Rules, 1975 and therefore not
applicable to the Company.
Acknowledgement:
Your Directors wish to place on record their sincere appreciation for
significant contribution made by the employees at all levels through
their dedication, hard work and commitment, enabling the Company to
achieve good performance during the year under review.
Your Directors also take this opportunity to place on record the
valuable co-operation and continued support extended by the banks,
government, business associates and the shareholders for their
continued confidence reposed in the Company and look forward to having
the same support in all future endeavors.
For and on behalf of the Board
Pankaj R. Patel
Chairman
Place : Ahmedabad.
Date : 5th May, 2011.
Mar 31, 2010
The directors have pleasure in presenting SIXTEENTH Annual Report of
the Company along with the Audited statement of accounts for the year
ended 31st March, 2010. The summarised results are given below:
SUMMARY OF FINANCIAL RESULT:
INR - Lacs
For the year ended 31st March, 31st March, Growth (%)
2010 2009
Sates and Other Income 27402 19582 39.9
Profit before Interest,
Depreciation,Exceptional
expenses & Tax (PBIDET) 7319 3981 83.8
Less: Depredation 159 167 (5.1)
Profit before Interest,
Exceptional expenses & Tax (PBIET) 7160 3814 86.7
Less: Interest 9 7 41.7
Expenses incurred on Composite
Scheme of Arrangement 220 160 37.0
Profit Before Tax (PBT) 6931 3647 90.0
Less: Provision for Tax 2404 1267 89.8
Profit After Tax (PAT) 4527 2380 90.2
Add : Profit brought forward
from the previous year 2491 1097
Profit available for
appropriation, which is
appropriated as follows: 7018 3477
Proposed Dividend 1172 586 100.0
Corporate Dividend Tax on
Proposed Dividend 195 100 95.0
Transferred to General Reserve 455 300
Balance carried to Balance Sheet 5196 2491
Total 7018 3477
Basic and Diluted Earnings per
share (EPS of FV Rs. 10/-)
[in Rupees]
- Before Exceptional items 12.15 6.50
- After Exceptional items 11.59 6.09
For the year ended on 31st March, 2010, the sales and other income of
the Company have increased by 39.9% to Rs. 27402 lacs compared to Rs.
19582 lacs in the previous year. Profit before Interest, Depreciation &
Tax increased to Rs. 7319 lacs compared to Rs. 3981 lacs in the
previous year. The Profit after Tax increased to Rs. 4527 lacs
compared to Rs. 2380 lacs in the previous year. The Company achieved
EPS (after exception items) of 11.59 compared to Rs. 6.09 in 2008-09. A
detailed analysis of performance for the year has been included in the
Management Discussion and Analysis, which forms part of the Annual
Report.
Your Directors are pleased to recommend a dividend of Rs. 3/- per
equity share (30%) (Previous year Rs. 1.5/- per equity share) on
39,072,089 equity shares of Rs. 10/- each fully paid-up for the
financial year ended on 31st March 2010.
LISTING OF EQUITY SHARES OF THE COMPANY ON NATIONAL STOCK EXCHANGE OF
INDIA LIMITED ("NSE")
The Equity Shares of the Company have been listed and admitted for
dealings on National Stock Exchange of India Limited w.e.f. 13th
November, 2009.
The Company has not accepted any deposits during the year.
DIRECTORS
In accordance with the provisions of the Companies Act, 1956 ("the
Act") read with Articles of Association of the Company, Mr. Ganesh N.
Nayak and Mr. Pankaj R. Patel, Directors retire by rotation at the
ensuing Annual General Meeting and being eligible offer themselves for
reappointment. The Board recommends their re- appointment.
Mr. Jitendra R. Patel ceased to be the Managing Director w.e.f. 29th
July, 2009. The Board placed on record the contribution made and the
valuable services rendered by him during his association with the
Company.
Dr. B. M. Hegde, Prof. Indiraben J. Parikh and Mr. Anand G. Deo were
appointed as Additional Directors pursuant to section 260 of the Act
w.e.f. 29th July, 2009. They shall hold office up to the date of the
ensuing Annual General Meeting. The Company has received notices in
writing from the members along with a deposit of Rs. 500/- each
pursuant to the provisions of section 257 of the Act, proposing their
candidature for the office of Directors liable to retire by rotation.
The Board recommends their appointment as Directors.
Mr. Anand G. Deo was appointed as Managing Director of the Company
w.e.f. 1st August, 2009, which is subject to approval of shareholders
at the ensuing Annual General Meeting on the terms and conditions as
contained in the agreement entered between the Company and Managing
Director.
In accordance with the stipulation under clause 49 of the Listing
Agreement, brief resume of the Directors seeking
appointment/re-appointment at the ensuing Annual General Meeting
together with the nature of their expertise in specific functional
areas and names of companies in which they hold office as Director
and/or Chairman/Member of Committees of the Board is annexed to the
notice.
AUDITORS
M/s Mukesh M. Shah & Co., Chartered Accountants, the statutory auditors
of the Company have expressed their unwillingness for re-appointment at
the ensuing Annual General Meeting. The Audit Committee members and the
Board of Directors have recommended the appointment of M/s Manubhai &
Co., Chartered Accountants as the Statutory Auditors of the Company to
hold office from the conclusion of the ensuing Annual General Meeting
till the conclusion of the next Annual General Meeting and to fix their
remuneration. The Company has received a letter from M/s Manubhai &
Co,, Chartered Accountants under the provisions of section 224(1 B) of
the Companies Act, 1956 expressing their willingness for appointment as
Statutory Auditors, if made by the members will be within the statutory
limits prescribed.
INTERNAL AUDIT
During the year under review, the Company has engaged the services of
M/s. Kantilal Patel & Co., Chartered Accountants, Ahmedabad as Internal
Auditors to carry out internal audit on regular basis. The reports of
the internal audit were presented for review before the Audit
Committee. The Audit Committee also scrutinizes all the programmes and
adequacy of the internal audits.
DISCLOSURE
As required under section 217(l)(e) of the Companies Act, 1956 read
with the Companies (Disclosure of particulars in the Report of
Directors) Rules, 1988, the relevant information and data with respect
to the conservation of energy, technology absorption and foreign
exchange earnings/outgo have been provided in Annexure-A, attached to
this report.
There have been no material changes and commitments, which may affect
the financial position of the Company between the end of the financial
year and the date of the report.
As required under section 217(2) of the Companies Act, 1956, the Board
of Directors informs the members that during the financial year there
has been:
* no change in the nature of the Companys business and
* no change in the classes of business in which the company has an
interest.
MANAGEMENT DlSCUSSION AND ANALYSIS (MDA)
MDA covering details of operations, markets, opportunities and threats,
etc. for the year under review is given as a separate statement, which
forms part of this Annual Report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the requirements under section 217 (2AA) of the Companies
Act, 1956 and to the best of their knowledge and belief, and according
to the information and explanations provided to them, your Directors
hereby state that:
(a) the Annual Accounts for the year ended 31st March 2010 are prepared
on going concern basis;
(b) in preparation of the Annual Accounts, all the applicable
accounting standards have been followed. Necessary explanations are
given for material departures, if any;
(c) sound accounting policies have been selected and applied
consistently and judgments and estimates made that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the Company as on 31st March, 2010 and of the profit of the Company for
the year ended on that date and
(d) proper and sufficient care has been taken for maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the company and for
prevention and detection of fraud and other irregularities.
CORPORATE GOVERNANCE
In terms of clause 49 of the Listing Agreement with the Stock
Exchanges, Corporate Governance Report is made part of this Annual
report.
In compliance of section 292A of the Companies Act, 1956 and Listing
Agreement, an Audit Committee has been formed.
A certificate from Hitesh Buch & Associates, Practicing Company
Secretaries regarding compliance of the conditions stipulated under
clause 49 of the Listing Agreement is attached to the Corporate
Governance Report.
PARTICULARS OF EMPLOYEES
The statement of particulars of employees providing information as per
section 217(2A) of the Companies Act, 1956 read with Companies
(Particulars of Employees) Rules, 1975, forms a part of this report.
However, as per the provisions of section 219(l)(b)(iv) of the
Companies Act, 1956, the Annual Report excluding this statement is
being sent to all members. Any member interested in obtaining a copy of
this statement may write to the Company Secretary at the Registered
Office of the Company.
ACKNOWLDGEMENT
Your Directors wish to place on record their sincere appreciation for
significant contribution made by the employees at all levels through
their dedication, hard work and commitment, enabling the Company to
achieve good performance during the year under review.
Your Directors also take this opportunity to place on record the
valuable co-operation and continued support extended by the banks,
government, business associates and the shareholders for their
continued confidence reposed in the Company and look forward to having
the same support in all future endeavors.
FOR AND ON BEHALF OF THE BOARD OF DIRECTORS
Place : Ahmedabad. Pankaj R. Patel
Date : 14th June, 2010. Chairman