Mar 31, 2023
The Directors present their 32nd Annual Report on the business and operations of the Company and the accounts for the financial year ended March 31, 2023.
Rs. in Crores |
||||
Financial Results |
Standalone |
Consolidated |
||
Particulars |
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Revenue from Operations |
528.61 |
528.06 |
1466.73 |
1269.41 |
Other Income |
99.00 |
56.55 |
55.98 |
38.75 |
Total Income |
627.61 |
584.61 |
1522.71 |
1308.16 |
Profit Before Interest, Depreciation and Tax |
318.92 |
276.17 |
497.04 |
433.42 |
Less: Finance cost |
0.12 |
0.09 |
0.78 |
0.70 |
Less : Depreciation and amortisation expenses |
25.65 |
25.77 |
44.99 |
46.90 |
Add: Share of Profit in Associate |
0.00 |
0.00 |
0.08 |
0.00 |
Profit Before Tax |
293.15 |
250.31 |
451.35 |
385.82 |
Less: Tax Expenses |
58.89 |
62.44 |
74.36 |
77.37 |
Profit After Tax |
234.26 |
187.87 |
376.99 |
308.45 |
Less: Non-controlling Interest |
0.00 |
0.00 |
0.73 |
8.61 |
Net profit attributable to the Shareholders of the Company |
234.26 |
187.87 |
376.26 |
299.84 |
2. OPERATIONS REVIEW /PERFORMANCE
The Company has, on standalone basis, registered total revenue from operations of '' 528.61 Crores (Total Income '' 627.61 Crores) during the year under review as against '' 528.06 Crores (Total Income '' 584.61 Crores) in the previous financial year. The Profit After Tax was '' 234.26 Crores during the year under review as
against '' 187.87 Crores in the previous financial year. The Company has on consolidated basis, registered total revenue from operations of '' 1,466.73 Crores (Total Income '' 1522.71 Crores) during the year under review as against '' 1,269.41 Crores (Total Income '' 1308.16 Crores) in the previous financial year.
3. MANAGEMENT DISCUSSION & ANALYSIS AND BUSINESS RESPONSIBILITY & SUSTAINABILITY REPORT
In compliance with Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, (Listing Regulations) separate section on Management Discussion & Analysis and Business Responsibility Report & Sustainability, as approved by the Board, which includes details on the state of affairs of the Company along with operational performance / review, forms part of this Annual Report.
The Board of Directors at their Meeting held on May 27, 2023, declared an Interim Dividend of '' 2.00 (100%) per equity share of '' 2/- each, for the financial year 2022-23 and was paid to those shareholders whose name appeared in the Register of Members and beneficial owners as on the record date June 09, 2023.
Further, the Board of Directors, at their meeting held on August 7, 2023, have recommended a Final Dividend of '' 2.5 (125%) per equity share of '' 2 /- each, for the financial year 2022-23, subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM). If approved, the total dividend for the financial year 2022-23 would amount to '' 4.5/- per equity share (225%) of '' 2/- each.
In compliance with Regulation 43A of the Listing Regulations, the Dividend Distribution Policy is uploaded on the Company''s website at https://www.caplinpoint.net/wp-content/uploads/2021/07/ Dividend_Distribution_Policy.pdf
The Board of Directors have decided to retain the entire amount of profits for the financial year 2022-23 in profit and loss account.
Details of subsidiaries have been covered under Extract of Annual Return, which can be accessed on the following link. https://www. caplinpoint.net/index.php/shareholder-information/. During the year the company had disposed its entire investment in Caplin Point Laboratories Colombia SAS to Caplin Point Far East Limited - Hong Kong, a wholly - owned subsidiary of the Company vide share purchase agreement dated March 28, 2023. Hence, w.e.f March 28, 2023 Caplin Point Laboratories Colombia SAS ceased to be a subsidiary but became a step-down subsidiary.
Considering the Income generated for the FY 2021-22, Nuevos Eticos Neo Ethicals S.A - Guatemala a step down subsidiary held through Caplin Point Far East Limited - Hong Kong, exceeded the threshold limit for material subsidiary as specified in the Listing Regulations, in addition to Caplin Steriles Limited and Caplin Point Far East Limited, Hong Kong which were already considered as material subsidiaries of the Company.
Pursuant to Section 129(3) of the Act, 2013, a statement containing the salient features of the financial statements of subsidiaries in the prescribed Form AOC-1 is annexed as Annexure - I to this Report.
7. CONSOLIDATED FINANCIAL STATEMENTS
Pursuant to Section 129(3) of the Act, 2013 and Listing Regulations, the Consolidated Financial Statements prepared in accordance with the Indian Accounting Standards prescribed by the Institute of Chartered Accountants of India, are attached to this report.
Pursuant to the provisions of Section 136 of the Act, 2013 the consolidated financial statements along with relevant documents and separate audited financial statements in respect of the subsidiaries are available on the website of the Company.
The Company did not accept any deposits from the public within the meaning of Chapter V of the Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014 for the year ended March 31, 2023.
The paid up share capital as on March 31, 2023 stood at '' 15,18,05,492/-consisting of 7,59,02,746 equity shares of '' 2/-each. During the financial year the company had allotted 1,13,870 shares under various ESOP Schemes.
10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE ACT, 2013
Particulars of loans, guarantees and investments as on March 31, 2023 are given in the Note No. 3, 3A, 4 and 8 to the standalone financial statements.
11. NUMBER OF MEETINGS OF THE BOARD
The number of Board meetings held during the financial year 2022- 23 are provided as part of Corporate Governance Report prepared in terms of the Listing Regulations.
12. DIRECTORS AND KEY MANAGERIAL PERSONNELa. Directors
As on March 31, 2023, Board comprised of Seven Directors out of which five are Independent Directors (including an Independent Woman Director) a Managing- Director and one Promoter Director.
Mr. C C Paarthipan is a Promoter Director who is also the Chairman of the company. Dr. Sridhar Ganesan is the Managing Director of the Company.
Mr. D P Mishra (DIN: 02032818), Non - Executive Non - Independent Director tendered his resignation with effect from the closing hours of July 11, 2022. Further, Dr K C John (DIN: 01067374), Mr. V Thirumalai (DIN: 03015619) and Mr.R Viswanathan (DIN : 07173713 ) ceased to be Independent Directors on the Board of the company with effect from the close of business hours of August 24, 2022, December 17, 2022 and May 11, 2023 respectively as they have served the maximum term of an Independent Director under the Act. The Board wishes to place on record their appreciation for the valuable guidance and directions provided during their tenure as Directors of the Company.
The shareholders at their meeting held on September 29, 2022 had appointed Dr R Nagendran (DIN: 08943531) and Mr. S Deenadayalan (DIN: 01951620) as Independent Directors
on the Board for a period of five years effective from the date of the meeting based on the recommendation of the Nomination and Remuneration Committee and the Board.
Further, based on the recommendation of the Nomination and Remuneration Committee Dr. C K Gariyali was re-appointed as Independent Director for a second term of three years w.e.f from March 04, 2023 by the board subject to shareholders'' approval at the ensuing Annual General Meeting. Mr. D. Sathyanarayanan is the other Independent Director on the Board.
b. Company Secretary and Compliance Officer
During the year, Mr. Dinesh R G, Company Secretary, KMP and Compliance Officer of the Company tendered his resignation with effect from the closing hours of June 24, 2022. The Board has appointed Mr. Venkatram G as the Company Secretary & Compliance Officer of the Company effective from August 5, 2022.
Pursuant to Section 152 (6) of the Act, 2013, Mr. C C Paarthipan (DIN: 01218784), Non-Executive Promoter Director, retires by rotation and being eligible offers himself for re-appointment.
Pursuant to Sections 2(51) and 203 of the Act, 2013, Dr. Sridhar Ganesan, Managing Director, Mr. D Muralidharan, Chief Financial Officer and Mr. Venkatram G, Company Secretary are the KMP of the Company.
13. DECLARATION BY INDEPENDENT DIRECTORS
Pursuant to Section 149(7) of the Act, 2013, all Independent Directors have declared that they meet the criteria of independence as provided under the Act, 2013 and Listing Regulations and the Board confirms that they are independent of the management.
14. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Act, 2013, the Directors confirm that:
a. In the preparation of the annual accounts, the applicable accounting standards (IND AS) had been followed along with proper explanation relating to material departures;
b. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for that period;
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. The Directors had prepared the annual accounts on a going concern basis;
e. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
15. MATERIAL CHANGES AND COMMITMENTS, IF ANY AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There were no material changes and commitments, affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.
16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Pursuant to Section 134 (3)(m) of the Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014, particulars of conservation of energy, technology absorption, foreign exchange earnings and outgo, as are given as Annexure - II to this Directors'' Report.
17. ANNUAL EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of the Act, 2013 and Listing Regulations, the Board of Directors has carried out annual performance evaluation
of its own performance, the Directors Individually as well as the evaluation of the working of its Committees.
The manner in which the evaluation was carried out has been explained in the Corporate Governance Report which forms part of this report.
18. CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to the provisions of Section 135 of the Act, 2013 read with CSR Rules, the Company has constituted CSR Committee and based upon the recommendations of the CSR Committee the Board of Directors have approved CSR Policy.
Disclosure under the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as an Annexure - III to this report.
Pursuant to the Act, 2013 and the Listing Regulations, the Company has formed all the statutory Committees namely, the Audit Committee, the Nomination and Remuneration Committee, the Corporate Social Responsibility Committee, the Stakeholders'' Relationship Committee and the Risk Management Committee.
Detailed information about these Committees and relevant information for the year under review are given in the Corporate Governance Report.
There have been no instances where the Board did not accept the recommendations of its Committees including the Audit Committee.
20. INTERNAL FINANCIAL CONTROLS
Details in respect of adequacy of internal financial controls concerning the financial statements are stated in the Management Discussion and Analysis section which forms part of this Annual Report.
The Company has established a vigil mechanism, through a Whistle Blower Policy, the details of which are given in the Corporate Governance Report which forms part of this report
a. Statutory auditors
The current Statutory auditors M/s. CNGSN & Associates LLP, Chartered Accountants, Chennai, have served their maximum
permissible term under the Act, 2013. Their term comes to end at the forthcoming Annual General Meeting. The Board wishes to place on record their gratitude for the valuable guidance and support provided by them during their tenure.
M/s. CNGSN & Associates LLP, Chartered Accountants, Chennai, have issued the Auditors'' Report for the financial year 2022-23 which does not contain any qualification, reservation or adverse remark and the same is attached with the financial statements.
The Audit Commitee and the Board at their meeting held on August 07, 2023 have recommended the appointment of M/s Brahmayya & Co, Chartered Accountants, (Firm Registration No. 000511S) Chennai, as Statutory Auditors of the Company to hold office from the conclusion of forthcoming AGM till the conclusion of 37th AGM. A resolution to this effect forms part of the Notice to the shareholders.
The Company has obtained necessary certificate under Section 141 of the Act, 2013 conveying their eligibility for being the Statutory Auditors of the Company.
b. Secretarial auditors
Pursuant to Section 204 of the Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company is required to appoint a Secretarial Auditor for auditing secretarial and related records of the Company. Accordingly, M/s. Alagar and Associates was appointed as the Secretarial Auditors of the Company for the financial year March 31, 2023.
The Secretarial Audit Report for the financial year 2022-23, given by M/s. Alagar and Associates, Company Secretaries, Chennai is attached as Annexure - IV to this Report. The Secretarial Audit Report does not contain any qualification, reservation or other remarks.
Pursuant to Regulation 24A of Listing Regulations, the company shall annex with its Annual Report the Secretarial Audit Report of its material unlisted subsidiary incorporated in India. Caplin Steriles Limited being a material unlisted subsidiary of the Company, the Secretarial Audit Report is annexed as Annexure - IV-A to this Directors Report.
c. Internal auditors
Pursuant to Section 138 of the Act, 2013, the Board at its meeting held on May 12, 2022 had re-appointed M/s. TBL &
Associates as Internal Auditors for carrying out internal audit of the Company, for the financial year 2022-23. The internal audit for the financial year 2022-23 was completed as per the scope defined by the Audit Committee.
23. REPORTING OF FRAUDS BY AUDITORS
Pursuant to provisions of the Section 143(12) of the Act, 2013, neither the Statutory Auditors nor the Secretarial Auditors have reported any incident of fraud to the Audit Committee during the year under review.
Pursuant to Regulation 34 of Listing Regulations, a Report on Corporate Governance is given separately which forms part of this Annual Report.
Pursuant to Section 92(3) and 134(3)(a) of the Act, 2013, read with Rule 12 of Chapter VII Rules of the Companies (Management and Administration) Rules, 2014, as amended from time to time, Annual Return in Form MGT-7 for FY 2021-22 is uploaded on the website of the Company and can be accessed at https://www.caplinpoint.net/ index.php/shareholder-information/
The Company has constituted a Risk Management Committee in compliance with the requirements of Regulation 21 of the Listing Regulations. The details of this Committee and its terms of reference are set out in Corporate Governance Report, which forms part of this Annual Report.
27. EMPLOYEE STOCK OPTION PLAN
The Company has three stock option schemes in force (i.e) Caplin Point Employee Stock Option Plan - 2015, Caplin Point Employee Stock Option Plan - 2017 and Caplin Point Laboratories Limited Employees Stock Option Plan - 2021. The Company had cumulatively granted 8,14,392 employee stock options across all the schemes of which 3,52,746 equity shares had been allotted as on March 31, 2023. The details as required under Rule 12 (9) of Companies
(Share Capital and Debentures) Rules, 2014 and SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 as on March 31, 2023 is available at https://www.caplinpoint.net/index.php/ shareholder-information/
The Company believes that equity based compensation schemes are an effective tool to reward the employees in the growth of the Company to attract new talents, to retain the key resources in the organisation and for the benefit of the present and future employees of the Company and its subsidiaries.
28. PARTICULARS OF EMPLOYEES RELATED DISCLOSURES
The statements required under Section 197, of the Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, forms part of Annexure - V to this Report.
29. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the related party transactions are at arm''s length basis and were approved by the Audit Committee. Those transactions that are not in the normal course of business are approved by the Board in addition to Audit Committee and, if material, are taken to shareholders for approval.
All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval of the Audit Committee is obtained on an annual basis for the transactions which are planned/ repetitive in nature. Related Party Transactions entered pursuant to the omnibus approval so granted are placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions. All the Related Party Transactions under Ind AS-24 have been disclosed at Note No. 44 to the standalone financial statements forming part of this Annual Report.
Particulars of transactions with related parties, in prescribed form AOC-2 is enclosed as Annexure - VI to this Report.
The related party transaction policy and material related party transactions have been uploaded on the website of the Company at https://www.caplinpoint.net/wp-content/uploads/2021/07/ RELATED-PARTY-TRANSACTION-POLICY.pdf
30. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
There are no significant and material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company.
31. DISCLOSURE UNDER SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Pursuant to the provisions of Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has put in place a Policy on Prevention of Sexual Harassment at Workplace and Internal Complaints Committees (ICC) has been set up to redress complaints. There were no complaints relating to sexual harassment, pending at the beginning of financial year, received during the year and pending as at the end of the financial year 2022-23.
32. INVESTOR EDUCATION AND PROTECTION FUND
During the year under review, the Company has credited 1,21,725 unclaimed equity shares of ''2/- each to IEPF pertaining to those shareholders who have not encashed/claimed their dividends for a period of seven consecutive years. The voting rights on the shares outstanding in the IEPF Authority as on March 31, 2023 shall remain frozen till the rightful owner of such shares claims the shares.
Pursuant to Sections 124 and 125 of the Act, 2013, the unpaid or unclaimed dividend for the financial year 2015-16(final) has to be transferred to IEPF. Members, who have not yet en-cashed or claimed
the dividends that are yet to be transferred to the IEPF, are requested to refer the Corporate Governance Report.
a. There has been no change in the nature of business of the Company during the year under review.
b. Pursuant to Section 197 (14) of the Act, 2013, the Managing Director of the Company did not receive any remuneration or commission from any of its subsidiaries.
c. The Company maintains cost records as per Companies (Cost Records and Audit) Rules, 2014.
d. The Board confirms the compliance of the provisions of the Secretarial Standards notified by the Institute of Company Secretaries of India, New Delhi.
The Board of Directors wishes to place on record its sincere appreciation to the customers, suppliers, business partners and subsidiaries and shareholders for their support. The Directors would like to thank the Bankers and financial Institutions as well. The Directors would take this opportunity to appreciate and sincerely acknowledge the dedication and hard work of the employees for the growth of the Company.
For and on behalf of the Board of Directors
Place: Chennai C C Paarthipan
Date: August 07, 2023 Chairman
Mar 31, 2022
The Directors present their 31st Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31, 2022.
1. FINANCIAL HIGHLIGHTS |
||||
'' in Crores |
||||
Financial Results |
Standalone |
Consolidated |
||
Particulars |
2021-22 |
2020-21 |
2021-22 |
2020-21 |
Revenue from |
528.06 |
482.68 |
1269.41 |
1061.29 |
Operations |
||||
Other Income |
56.55 |
18.62 |
38.75 |
23.54 |
Total Income |
584.61 |
501.30 |
1308.16 |
1084.83 |
Profit Before Interest, Depreciation and Tax |
276.17 |
232.55 |
433.42 |
352.18 |
Less: Finance cost |
0.09 |
0.17 |
0.70 |
1.59 |
Less : Depreciation and amortisation expenses |
25.77 |
22.44 |
46.90 |
36.97 |
Profit Before Tax |
250.31 |
209.94 |
385.82 |
313.62 |
Less: Tax Expenses |
62.44 |
53.71 |
77.37 |
62.19 |
Profit After Tax |
187.87 |
156.23 |
308.45 |
251.43 |
Less: Non-controlling Interest |
- |
- |
8.61 |
9.16 |
Net profit attributable to the Shareholders of the Company |
187.87 |
156.23 |
299.84 |
242.27 |
2. OPERATIONS REVIEW /PERFORMANCE
The Company has, on standalone basis registered total revenue from operations of '' 528.06 Crores (Total Income '' 584.61 Crores) during the year under review as against '' 482.68 Crores (Total Income '' 501.30 Crores) in the previous Financial Year. The Profit After Tax was '' 187.87 Crores during the year under review as against '' 156.23 Crores in the previous Financial Year.
The Company has on consolidated basis, registered total revenue from operations of '' 1,269.41 Crores (Total Income '' 1,308.16 Crores) during the year under review as against '' 1,061.29 Crores (Total Income '' 1,084.83 Crores) in the previous Financial Year.
3. MANAGEMENT DISCUSSION AND ANALYSIS AND BUSINESS RESPONSIBILITY REPORT
In compliance with Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, (Listing Regulations) separate Section on Management Discussion and business responsibility report, as approved by the Board, which includes details on the state of affairs of the Company along with operational performance / review, forms part of this Annual Report.
The Board of Directors at their Meeting held on May 12, 2022, declared an Interim Dividend of '' 2.00 (100%) per equity share of '' 2/- each, for the Financial Year 2021-22 and was paid to those shareholders whose name appeared in the Register of Members and beneficial owners as on the record date May 24, 2022.
Further, the Board of Directors, at their meeting held on August 5, 2022, have recommended a Final Dividend of '' 2 (100%) per equity share of '' 2 /- each, for the Financial Year 2021-22, subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM). If approved, the total dividend for the Financial Year 2021-22 would amount to '' 4/- per equity share (200%) of '' 2/- each.
In compliance with Regulation 43A of the Listing Regulations, the Dividend Distribution Policy is uploaded on the Company''s website at https://www.caplinpoint.net/index.php/corporate-governance/
The Board of Directors have decided to retain the entire amount of profits for the Financial Year 2021-22 in profit and loss account.
Details of subsidiaries have been covered under Extract of Annual Return, which can be accessed on the following link. https://www. caplinpoint.net/index.php/investors-2/
During the Financial Year, there were no material development in the status of subsidiary companies. Caplin Steriles Limited and Caplin Point Far East Limited, Hongkong are the material subsidiaries of the Company.
Pursuant to Section 129(3) of the Act, 2013, a statement containing the salient features of the financial statements of subsidiaries in the prescribed Form AOC-1 is annexed as Annexure - I to this Report.
7. CONSOLIDATED FINANCIAL STATEMENTS
Pursuant to Section 129(3) of the Act, 2013 and Listing Regulations, the Consolidated Financial Statements prepared in accordance with the Indian Accounting Standards prescribed by the Institute of Chartered Accountants of India, are attached to this report.
Pursuant to the provisions of Section 136 of the Act, 2013 the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of the subsidiaries are available on the website of the Company.
The Company did not accept any deposits from the public within the meaning of Chapter V of the Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014 for the year ended March 31, 2022.
The paid up share capital as on March 31, 2022 stood at '' 15,15,77,752/-consisting of 7,57,88,876 equity shares of '' 2/-each.
10. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE ACT, 2013
Particulars of loans, guarantees and investments as on March 31, 2022 are given in the Note No. 3, 3A, 4 and 8 to the standalone financial statements.
11. NUMBER OF MEETINGS OF THE BOARD
The number of Board meetings held during the Financial Year 202122 are provided as part of Corporate Governance Report prepared in terms of the Listing Regulations.
12. DIRECTORS AND KEY Managerial pERSONNELa. Directors
As on March 31, 2022, the Board consisted of a Non- Executive Chairman, Managing Director, five Independent Directors and a Non-Executive - Non- Independent Director.
Dr. R Ravichandran (DIN: 01920603), Independent Director retired on May 11, 2021 (close of business hours), upon completion of his tenure. Further, Mr. D P Mishra (DIN: 02032818), Non - Executive Non - Independent Director tendered his resignation with effect from the closing hours of July 11, 2022. The Board wishes to place on record their valuable guidance and directions provided during their tenure as Directors of the Company.
The term of appointment of Dr K C John (DIN: 01067374) as Independent Director ended on August 24, 2022. The term of appointment of Mr V Thirumalai (DIN: 03015619) as Independent Director ends on December 17, 2022. Both the Directors cannot be re-appointed for a further term since they have served the maximum number of terms permitted under the Companies Act. Hence, the Board, on the recommendation of the Nomination and Remuneration Committee, has proposed, for the approval of shareholders at the forthcoming AGM, the induction of Dr R Nagendran (DIN: 08943531) and Mr S Deenadhayalan (DIN: 01951620) as Independent Directors on the Board of the Company. In the opinion of the Board and the Nomination and Remuneration Committee, both the Directors are eligible and qualified to be appointed in the Board as Independent Directors.
The respective Directors have submitted all the relevant declarations which were taken on record by the Nomination and Remuneration Committee and the Board. Further details and the profile of the Directors are given as part of the Notice of the AGM.
b. Company Secretary and Compliance Officer
During the year, the Board had appointed Mr. Dinesh R G as the Company Secretary, KMP and Compliance Officer of the Company effective May 6, 2021. Mr. Dinesh R G tendered his resignation with effect from the closing hours of June 24, 2022. The Board appointed Mr. G Venkatram, General Counsel & Compliance Head as the Company Secretary & Compliance Officer of the Company effective August 5, 2022.
Pursuant to Section 152 (6) of the Act, 2013, Dr Sridhar Ganesan (DIN: 06819026), Managing Director, retires by rotation and being eligible offers himself for re-appointment.
Pursuant to Sections 2(51) and 203 of the Act, 2013, Dr. Sridhar Ganesan, Managing Director, Mr. D Muralidharan, Chief Financial Officer and Mr. G Venkatram, Company Secretary are the KMP of the Company.
Further, the term of Dr. Sridhar Ganesan as the Managing Director of the Company ended on 24th August, 2022. Extension of the term of appointment/ re-appointment has been approved by the Board on the recommendation of the Nomination and Remuneration Committee for a period of two years from 25th August, 2022 at the meeting held on 5th September, 2022. The terms of re-appointment is given as part of the Notice of the AGM.
13. DECLARATION BY INDEPENDENT DIRECTORS
Pursuant to Section 149(7) of the Act, 2013, all Independent Directors have declared that they meet the criteria of independence as provided under Section 149(6) of the Act, 2013 and Regulation 25 of the Listing Regulations and the Board confirms that they are independent of the management.
14. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Act, 2013, the Directors confirm that:
a. In the preparation of the annual accounts, the applicable accounting standards (IND AS) had been followed along with proper explanation relating to material departures;
b. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for that period;
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. The Directors had prepared the annual accounts on a going concern basis;
e. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
15. MATERIAL CHANGES AND COMMITMENTS, IF ANY AFFECTING THE FINANCIAL position oF THE CoMpANY
There were no material changes and commitments, affecting the financial position of the Company, which have occurred between the end of the Financial Year of the Company to which the financial statements relate and the date of the report.
16. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN
exchange earnings and outgo
Pursuant to Section 134 (3)(m) of the Act, 2013 read with Rule 8 (3) of the Companies (Accounts) Rules, 2014, particulars of conservation
of energy, technology absorption, foreign exchange earnings and outgo, as are given as Annexure - II to this Directors'' Report.
17. ANNUAL EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of the Act, 2013 and Regulation 4 of the Listing Regulations, the Board of Directors has carried out annual performance evaluation of its own performance, the Directors Individually as well as the evaluation of the working of its Committees.
The manner in which the evaluation was carried out has been explained in the Corporate Governance Report which forms part of this report.
18. CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to the provisions of Section 135 of the Act, 2013 read with CSR Rules, the Company has constituted CSR Committee and based upon the recommendations of the CSR Committee the Board of Directors have approved CSR Policy.
Disclosure under Companies Corporate Social Responsibility Policy 2014 is annexed as an Annexure - III to this report.
Pursuant to the Act, 2013 and the Listing Regulations, the Company has formed all the statutory Committees namely, the Audit Committee, the Nomination and Remuneration Committee, the Corporate Social Responsibility Committee, the Stakeholders'' Relationship Committee and the Risk Management Committee.
Detailed information about these Committees and relevant information for the year under review are given in the Corporate Governance Report.
There have been no instances where the Board did not accept the recommendations of its Committees including the Audit Committee.
20. INTERNAL FINANCIAL CONTROLS
Details in respect of adequacy of internal financial controls concerning the Financial Statements are stated in the Management Discussion and Analysis section which forms part of this Annual Report.
The Company has established a vigil mechanism, through a Whistle Blower Policy, where Directors and employees can voice their genuine concerns or grievances about any unethical or unacceptable business practice. A whistle-blowing mechanism not only helps the Company in detection of fraud, but is also used as a corporate governance tool leading to prevention and deterrence of misconduct. It provides direct access to the employees of the Company to approach the Compliance Officer or the Chairman of the Audit Committee, where necessary. The Company ensures that genuine Whistle Blowers are accorded complete protection from any kind of unfair treatment or victimization.
The Vigil mechanism policy is disclosed on the website of the Company at https://www.caplinpoint.net/index.php/corporate-governance/
a. Statutory auditors
The Resolution seeking approval of the shareholders for reappointment of M/s. CNGSN & Associates LLP, Chartered Accountants, Chennai, as Statutory Auditors of the Company to hold office, from the conclusion of 31st AGM till the conclusion of 32nd AGM forms part of the Notice to the shareholders.
The Company has obtained necessary certificate under Section 141 of the Act, 2013 conveying their eligibility for being the Statutory Auditors of the Company for the Financial Year 2022-23.
The Auditors'' Report for the Financial Year 2021-22 does not contain any qualification, reservation or adverse remark and the same is attached with the annual financial statements.
b. Secretarial auditors
Pursuant to Section 204 of the Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company is required to appoint a Secretarial Auditor for auditing secretarial and related records of the Company.
The Secretarial Audit Report for the Financial Year 2021-22, given by M/s. Alagar and Associates, Company Secretaries, Chennai is attached as Annexure - IV to this Report. The Secretarial Audit Report does not contain any qualification, reservation or other remarks.
Pursuant to Regulation 24A of Listing Regulations, a listed entity shall annex with its Annual Report the Secretarial Audit Report of its material unlisted subsidiary incorporated in India. Caplin Steriles Limited being a material unlisted subsidiary of the Company, the Secretarial Audit Report is annexed as Annexure - IV-A to this Directors Report.
c. Internal auditors
Pursuant to Section 138 of the Act, 2013, the Board at its meeting held on May 6, 2021 had re-appointed M/s. TBL & Associates as Internal Auditors for carrying out internal audit of the Company, for the Financial Year 2021-22. The internal audit for the Financial Year 2021-22 was completed as per the scope defined by the Audit Committee from time to time.
23. REPORTING OF FRAUDS BY AUDITORS
Pursuant to provisions of the Section 143(12) of the Act, 2013, neither the Statutory Auditors nor the Secretarial Auditors have reported any incident of fraud to the Audit Committee during the year under review.
Pursuant to Regulation 34 of Listing Regulations, a Report on Corporate Governance is given separately which forms part of this Annual Report.
Pursuant to Section 92(3) and 134(3)(a) of the Act, 2013, read with Rule 12 of Chapter VII Rules of the Companies (Management and Administration) Rules, 2014, as amended from time to time, Annual Return in Form MGT-7 for FY 2021-22 is uploaded on the website of the Company and can be accessed at https://www.caplinpoint.net/ index.php/shareholder-information/
The Company has constituted a Risk Management Committee in compliance with the requirements of Regulation 21 of the Listing Regulations. The details of this Committee and its terms of reference are set out in Corporate Governance Report, which forms part of this Annual Report.
The Company has in place a Risk Management framework to identify, evaluate and monitor business risks and challenges across the Company, that seek to minimise the adverse impact on business objectives and capitalise on opportunities. The Company''s success as an organisation largely depends on its ability to identify such opportunities and leverage them while mitigating the risks that arise while conducting its business.
27. employee stock option plan
The Company has three stock options in force (i.e) Caplin Point Employee Stock Option Plan - 2015, Caplin Point Employee Stock Option Plan - 2017 and Caplin Point Laboratories Limited Employees Stock Option Plan - 2021. The Company had cumulatively granted 9,07,992 employee stock options across all the schemes of which 2,38,876 equity shares had been allotted as on 31st March, 2022. The details as required under Rule 12 (9) of Companies (Share Capital and Debentures) Rules, 2014 and SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 as on March 31, 2022 is available at https://www.caplinpoint.net/index.php/shareholder-information/
The Company believes that equity based compensation schemes are an effective tool to reward the employees in the growth of the Company to attract new talents, to retain the key resources in the organisation and for the benefit of the present and future employees of the Company.
28. particulars of employees related disclosures
The statements required under Section 197, of the Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, form part of this Report and will be made available to any shareholder on request, as prescribed therein.
The prescribed particulars of employees required under 5(1) of the said Rules is annexed as Annexure - V to this Report.
29. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All Related Party Transactions which were entered into during the year under review were on arm''s length basis and in the ordinary course of business. There were no materially significant related party transactions made by the Company with the Promoters, Directors and KMP which may have a potential conflict with the interests of the Company at large.
All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval of the Audit Committee is obtained on an annual basis for the transactions which are planned/ repetitive in nature. Related Party Transactions entered pursuant to the omnibus approval so granted are placed before the Audit Committee for its review on a quarterly basis, specifying the nature, value and terms and conditions of the transactions. All the Related Party Transactions under Ind AS-24 have been disclosed at Note No. 45 to the standalone financial statements forming part of this Annual Report.
Particulars of transactions with related parties, in prescribed form AOC-2 is enclosed as Annexure - VI to this Report.
Approval of the shareholders is being sought under Regulation 23 of the Listing Regulations for the material Related Party Transactions and the proposal along with detailed explanatory statement is given as part of the Notice to Shareholders for the ensuing AGM.
The related party transaction policy and material related party transactions have been uploaded on the website of the Company at https://www.caplinpoint.net/index.php/corporate-governance/
30. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS
There are no significant and material orders passed by the Regulators or Courts or Tribunals which would impact the going concern status of the Company.
31. disclosure under sexual harassment of women at the WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Pursuant to the provisions of Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013,
the Company has put in place a Policy on Prevention of Sexual Harassment at Workplace and Internal Complaints Committees (ICC) has been set up to redress complaints. There were no complaints relating to sexual harassment, pending at the beginning of Financial Year, received during the year and pending as on the end of the Financial Year 2021-22.
32. INVESTOR EDUCATION AND pROTECTION FUND
Pursuant to Sections 124 and 125 of the Act, 2013, the amount of dividends remaining unpaid or unclaimed for a period of seven years from the date of transfer to the unpaid account, is required to be transferred to the Investor Education and Protection Fund (IEPF) of the Central Government.
During the year under review, the Company has credited 1,12,355 unclaimed equity shares of '' 2/- each to IEPF pertaining to those shareholders who have not encashed/claimed their dividends for a period of seven consecutive years. The voting rights on the shares outstanding in the IEPF Authority as on March 31, 2022 shall remain frozen till the rightful owner of such shares claims the shares.
Pursuant to Sections 124 and 125 of the Act, 2013, the unpaid or unclaimed dividend for the Financial Year 2014-15 has to be transferred to IEPF. Members, who have not yet en-cashed or claimed the dividends that are yet to be transferred to the IEPF, are requested to contact the Company''s Registrar and Share Transfer Agent, at the earliest.
Members are requested to take note of the same and claim their unclaimed dividends immediately to avoid transfer of the underlying shares to the IEPF Account. The shares transferred to the IEPF Account can be claimed back by the concerned Members from IEPF Authority after complying with the procedure prescribed under the Rules.
a. There has been no change in the nature of business of the Company during the year under review.
b. Pursuant to Section 197 (14) of the Act, 2013, the Managing Director of the Company did not receive any remuneration or commission from any of its subsidiaries.
c. The Company maintains cost records as per Companies (Cost Records and Audit) Rules, 2014.
d. The Board confirms the compliance of the provisions of the Secretarial Standards notified by the Institute of Company Secretaries of India, New Delhi.
The Board of Directors wishes to place on record its sincere appreciation to the customers, suppliers, business partners and
subsidiaries and shareholders for their support. The Directors would like to thank the Bankers and financial Institutions as well. The Directors would take this opportunity to appreciate and sincerely acknowledge the dedication and hard work of the employees for the growth of the Company.
FOR AND ON BEHALF OF THE BOARD
Place: Chennai C C PAARTHIPAN
Date: September 05, 2022 Chairman
Mar 31, 2018
To the Members
The Directors present their 27th Annual Report on the business and operations of the Company and the accounts for the financial year ended MarcRs.31, 2018
Financial Highlights
Rs. in Lakhs
Particulars |
Standalone for the year ended |
Consolidated for the year ended |
||
MarcRs.31 2018 |
MarcRs.31 2017 |
MarcRs.31 2018 |
MarcRs.31 2017 |
|
Revenue from Operations |
42,657.39 |
34,154.93 |
53,984.20 |
40,164.85 |
Other Income |
2,331.33 |
1,251.25 |
1,266.52 |
995.53 |
Total Income |
44,988.72 |
35,406.18 |
55,250.72 |
41,160.38 |
Profit Before Interest, Depreciation and Tax |
16,510.20 |
10,596.57 |
20,743.45 |
13,437.29 |
Less: Finance cost |
6.12 |
12.75 |
6.12 |
12.75 |
Less : Depreciation and amortisation expenses |
1,898.78 |
1,325.99 |
1,899.50 |
1,329.84 |
Profit Before Tax |
14,605.30 |
9,257.83 |
18,837.83 |
12,094.70 |
Less: Tax Expenses |
4,374.21 |
2,226.13 |
4,374.33 |
2,544.41 |
Net Profit |
10,231.09 |
7,031.70 |
14,463.50 |
9,550.29 |
Less : Non-controlling Interest |
- |
- |
(15.27) |
(10.95) |
Net profit attrituable to the shareholders of the Company |
10,231.09 |
7,031.70 |
14,478.77 |
9,561.24 |
PERFORMANCE/OPERATIONS REVIEW
The Company has on standalone basis registered total revenue from operations of Rs. 42,657.39 Lakhs (Total Income Rs. 44,988.72 Lakhs) during the year under review as against Rs. 34,154.93 Lakhs ( Total Income Rs.35,406.18) in the previous financial year. The Profit after tax was Rs.10,231.09 Lakhs during the year under review as against Rs. 7,031.70 Lakhs in the previous financial year.
The Company has on consolidated basis registered total revenue from operations of Rs.53,984.20 Lakhs (Total Income Rs.55,250.72 Lakhs)during the current financial year as against Rs. 40,164.85 Lakhs ( Total Income Rs.41,160.38 Lakhs )in the previous financial year .
As required under Section 134(3)(i) of the Companies Act,2013 the State of Affairs of the Company and outlook has been discussed in Management Discussions and Analysis Report which is appended in this annual report pursuant to Regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015.
DIVIDEND
The Board of Directors at their meeting held on May 28,2018 have recommended a dividend of Rs. 2.00 per equity share (100%) of Rs .2 /- each . The said dividend if approved by the members at the 27th Annual General Meeting which is to be held on September 28,2018 would absorb a total cash out flow of Rs. 15,12,07,000/- excluding Dividend Distribution Tax.
TRANSFER TO RESERVES
The Company has made no transfers to reserves during the financial year 2017-18
SUBSIDIARIES
As on MarcRs.31,2018, the Company has three subsidiaries :
(i) Argus Salud Pharma LLP,
(ii) Caplin Point Far East Limited - Hongkong
(iii) Caplin Point Laboratories Colombia SAS-Colombia.
The consolidated financial results/ performance incorporating the financial statements of the above subsidiaries are attached to the annual report as required under the IND AS and SEBI Regulations.
Further, a statement containing the salient features of the financial statements of our subsidiary pursuant to Section 129(3) of the Companies Act, 2013, in the prescribed Form AOC-1 is appended as Annexure I to the Boardâs report.
DEPOSITS
The Company did not accept any deposits from the public within the meaning of Chapter V of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014.
SHARE CAPITAL
The paid up share capital as on MarcRs.31,2018 stood at Rs.15,12,07,000/- consisting of 7,56,03,500 equity shares at the face value of Rs.2/- each. During the year, Company has allotted 26,750 equity shares of Rs.2/- each under Employee Stock Option Plan -2015.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE COMPANIES ACT, 2013
Particulars of loans, guarantees and investments as on MarcRs.31,2018 are given in the Note No. 3 & 4 to the standalone financial statements.
INDIAN ACCOUNTING STANDARDS (IND AS) -IFRS CONVERGED STANDARDS
As notified by the Ministry of Corporate Affairs, the Company adopted Indian Account Standards ( IND AS) w.e.f April 01.2017. Accordingly, financial statement of the Company and its subsidiaries were prepared with comparative data for the year ended MarcRs.31,2018 in compliance with IND AS.
NUMBER OF MEETINGS OF THE BOARD
The Board met five times during the year ended MarcRs.31, 2018 which were held on 10.05.2017, 07.08.2017, 09.11.2017, 07.02.2018 and 12.03.2018.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
The Board consist of a Non- executive Chairman, two executive Directors, six Independent Directors and a Non-executive -Non- Independent Director .
INDEPENDENT DIRECTORS
MR V THIRUMALAI (DIN:03015619)
The members of the Company at their twenty third Annual General Meeting appointed Mr V Thirumalai as a Non- Executive Independent Director for a period of three years from December 18,2014 to December 17,2017. As per the provisions of Section 149(10) of the Companies Act,2013 an Independent Director can be re-appointed for a second term of Five years by passing Special Resolution. The Board of Directors of the Company at their meeting held on November 09,2017 re-appointed Mr V Thirumalai for a Second term of five consecutive years effective from December 18,2017 and shall not be liable to retire by rotation. Board of Directors recommends the re-appointment of Mr V Thirumalai to hold office as an Independent Director upto December 17,2022
DR K NIRMALA PRASAD (DIN:07088120)
The members of the Company at their Twenty Fourth Annual General Meeting appointed Dr K Nirmala Prasad as a Nonexecutive Independent Director for a period of three years from February 04,2015 to February 03,2018. The Board of Directors at their meeting held on February 07,2018 reappointed Dr K Nirmala Prasad for a second term of five consecutive years without break of office effective from February 04,2018 and shall not be liable to retire by rotation . Board of Directors recommends the re-appointment of Dr K Nirmala Prasad to hold office as an Independent Director upto February 03,2023
MR R VISWANATHAN (DIN:07173713)
The members of the Company at their Twenty Fourth Annual General Meeting appointed Mr R Viswanathan as a Non-executive Independent Director for a period of three years from May 12,2015 to May 11,2018. The Board of Directors re-appointed him for a second term of five consecutive years effective from May 12,2018 and shall not be liable to retire by rotation. Board of Directors recommends the re-appointment of Mr R Viswanathan to hold office as an Independent Director upto May 11,2023
In the opinion of the Board of Directors Mr V Thirumalai, Dr K Nirmala Prasad and Mr R Viswanathan are eligible to be re-appointed as Independent Directors and they are Independent of the management.
The above re-appointments have been recommended by the Nomination and Remuneration Committee and are subject to the approval of the members of the Company by way of special resolution at their 27th Annual General Meeting .
Profile of these Directors, pursuant to regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 and Secretarial Standard -2 on General Meetings, are given in the notice of 27th Annual General Meeting.
RETIREMENT BY ROTATION
In terms of Section 152 (6) of the Companies Act, 2013, Mr D P Mishra (DIN :02032818) retires by rotation and being eligible offers himself for re-appointment.
RETIREMENT
Mr M Jayapal, Whole-time Director on attaining super annuation retired from the Board with effect from MarcRs.28,2018 as per the terms of his re- appointment. The Board of Directors placed on record their appreciation for the valuable services rendered by Mr M Jayapal during his tenure as the whole- time Director.
KEY MANAGERIAL PERSONNEL
Pursuant to section 2 (51) and Section 203 of the Companies Act,2013, Dr Sridhar Ganesan, Managing Director, Dr Philip Ashok Karunakaran, Whole-time Director ,Mr D Muralidharan , Chief Financial Officer and Mr Vinod Kumar S, Company Secretary are the Key Managerial personnel of the Company.
DECLARATION BY INDEPENDENT DIRECTORS
ALL Independent Directors of the Company have submitted their declaration as required pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipuLated in Section 149(6) of the Companies Act, 2013.
EXTRACT OF ANNUAL RETURN
As required pursuant to Section 134 (3) (a) of the Companies Act, 2013, an extract of Annual Return in the prescribed Form MGT 9 is given as Annexure II to this Directorsâ Report.
DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act, 2013, the Directors confirm that:
a. In the preparation of the annual accounts, the appLicabLe accounting standards had been foLLowed aLong with proper expLanation reLating to materiaL departures;
b. The Directors had seLected such accounting poLicies and appLied them consistentLy and made judgments and estimates that are reasonabLe and prudent so as to give a true and fair view of the state of affairs of the Company as at MarcRs.31,2018 and of the Profit of the Company for that period;
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irreguLarities;
d. The Directors had prepared the annual accounts on a going concern basis;
e. The Directors had Laid down internaL financiaL controLs to be foLLowed by the Company and that such internaL financiaL controLs are adequate and were operating effectiveLy;
f. The Directors had devised proper systems to ensure compLiance with the provisions of aLL appLicabLe Laws and that such systems were adequate and operating effectiveLy.
NOMINATION AND REMUNERATION COMMITTEE (NRC) AND ITS POLICY
The Nomination and Remuneration Committee is empowered to authorize and exercise the power as specified in section 178 of the Companies Act, 2013. The Company has a poLicy on Directors appointment and remuneration incLuding the criteria for determining the quaLification, positive attributes and independence of a Director and other matters as provided under section 178(3) of the Companies Act,2013. The Nomination and Remuneration Committee poLicy is annexed in Annexure III of the Directorâs report.
MATERIAL CHANGES AND COMMITMENTS
There were no materiaL changes and commitments, affecting the financiaL position of the Company, which have occurred between the end of the financiaL year of the Company to which the financiaL statements reLate and the date of the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
Pursuant to Section 134 (3)(m) of the Companies Act,2013 read with in RuLe 8 (3) of the Companies (Accounts) RuLes, 2014 particulars of conservation of energy, technology absorption, foreign exchange earnings and outgo, as are given as Annexure IV to this Directorsâ Report.
ANNUAL EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Section 134(3) (p)the Companies Act, 2013 the Board had carried out performance evaluation of its own of the Board Committees and of the Independent Directors .Independent Directors at their separate meeting held on February 07,2018 evaluated performance of the NonIndependent Directors, Board as a whole and of the Chairman of the Board. The outcome of the evaluation process were satisfactory, which resulted in the active engagement of the Board and committees in the Company.
Further the Directors are regularly informed and familiarized during the Board Meetings about the activities of the Company and its operations, products and its development and latest trends in the pharmaceutical industry and issues faced by the industry.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to the provisions of section 135 of the Act, read with CSR Rules, the Company has constituted Corporate Social Responsibility Committee and based upon the recommendation of the CSR committee the Board of Directors have approved CSR Policy.
Disclosure under Companies (Corporate social responsibility policy) rules, 2014 is annexed as an Annexure V to this report.
AUDIT COMMITTEE
The Composition of the Audit Committee, meetings of the Audit Committee and their terms of reference of the Audit Committee have been disclosed separately in the Corporate Governance Report which is annexed and forms part of this annual report.
INTERNAL FINANCIAL CONTROLS
The Company has designed and implemented adequate financial control systems with respect to the financial statements. During the year under review, no serious / adverse observation have been received from the Internal Auditors of the Company with respect to ineffectiveness or inadequacy of such controls.
VIGIL MECHANISM
The Company has established a vigil mechanism, through a Whistle Blower Policy, where Directors and employees can voice their genuine concerns or grievances about any unethical or unacceptable business practice. A whistle-blowing mechanism not only helps the Company in detection of fraud, but is also used as a corporate governance tool leading to prevention and deterrence of misconduct .It provides direct access to the employees of the Company to approach the Compliance Officer or the Chairman of the Audit Committee, where necessary. The Company ensures that genuine Whistle Blowers are accorded complete protection from any kind of unfair treatment or victimization. The Vigil mechanism policy is disclosed on the website of the Company (i.e) www.capiinpoint.net/investor/Company policies & code of conduct/Whistei Bowier Poiicy(Vigii Mechanism)
AUDITORS STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013, M/s. CNGSN & Associates LLP, Chartered Accountants, Chennai, Statutory Auditors of the Company shaii hoid office tiii the conciusion of 31st Annuai Generai Meeting of the Company.
SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Ruie 9 of the Companies (Appointment and Remuneration of Manageriai Personnei) Rules 2014, the Board of Directors of the Company appointed M/s. G Ramachandran & Associates, Company Secretaries, Chennai to conduct the secretarial audit of the Company. The Secretarial Audit Report (Form MR - 3) is given as Annexure VI to this Directorsâ Report.
CORPORATE GOVERNANCE
Pursuant to Regulation 34 of SEBI (Listing Obiigations and Disciosure Requirements) Reguiations, 2015, a report on Corporate Governance is given separateiy which forms a part of this Annuai report.
RISK MANAGEMENT
The Board has designed and framed risk management approach through which it identifies and manages the risk parameters. The senior ievei management periodicaiiy reviews the risks parameters through which key business risk are identified and addressed. A brief report on the Risk Management are referred in the Management Discussion and Anaiysis Report which forms a part of the Annuai Report.
EMPLOYEE STOCK OPTION PLAN
The Company has two stock options in force (i.e) Capiin Point Empioyee Stock Option Plan -2015 and Capiin Point Employee Stock Option Pian - 2017. During the year under review, the Company has granted 2,94,000 options under Capiin Point Employee Stock Option Pian -2015 and 76,500 options under Capiin Point Employee Stock Option Pian-2017. The Company has aiso aiiotted 26,750 shares under Capiin Point Empioyee Stock Option Pian - 2015. The detaiis required under Ruie 12 (9) of Companies (Share Capitai and Debentures) Ruies, 2014 and as required to be provided under the SEBI Guideiines as on MarcRs.31, 2018 are set out in Annexure VII to this Report.
The Board of Directors of the Company have decided to cover the employees of the subsidiaries in Caplin Point Employee Stock option Plan -2017 which is recommended for members approval by way of special resolution at the 27th Annual General Meeting.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosures pursuant to Section 197(12) of Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed in the Annexure VIII to this Directors report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
The Company did not enter into any related party transactions during the year under review. Particulars of transactions with related parties, in prescribed form AOC 2 is enclosed as Annexure IX.
The related party transaction policy has been uploaded on the website of the Company www.caplinpoint.net/investor/company Policies & code of Conduct/Related Party Transactions Policy
DIVIDEND DISTRIBUTION POLICY
Securities and Exchange Board of India, by its notification dated 8th July, 2016, has amended the SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 , introducing new Regulation 43A mandating the top 500 listed entities, based on market capitalization calculated as on 31st March of every financial year, to formulate a Dividend Distribution Policy and disclose the same in their Annual Reports and on their websites.
Accordingly, the Board of Directors of the Company has adopted a Dividend Distribution Policy, which is attached as Annexure X .The Policy is also available on the website of the Company www.caplinpoint.net/investor/ Companies policy & Code of conduct/ Dividend Distribution policy
BUSINESS RESPONSIBILITY REPORT
The Business Responsibility Report, as required pursuant to Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015 is attached as Annexure XI of this Annual Report.
INVESTOR EDUCATION AND PROTECTION FUND
Pursuant to Section 124 and 125 of the Companies Act,2013, the amount of dividend remaining unpaid or unclaimed for a period of seven years from the date of transfer to the unpaid account, is required to be transferred to the Investor Education and Protection Fund (IEPF) of the Central Government. Accordingly, unpaid or unclaimed dividend in respect of the financial year 2009-10 have been transferred to the IEPF.
During the year under review, the Company has credited 14,60,631 unclaimed Equity Shares of Rs. 2/- each to Investor Education and Protection Fund of those shareholders who have not encashed/claimed the their dividends for a period of seven consecutive years from the year 2009 -10.
Pursuant to Section 124 and 125 of the Companies Act,2013, the unpaid or unclaimed dividend for the financial year 2010-11 has to be transferred to IEPF. Members, who have not yet en-cashed or claimed the dividends that are yet to be transferred to the IEPF, are requested to contact the Companyâs Registrar and Share Transfer Agent, at the earliest.
Members are requested to take note of the same and claim their unclaimed dividends immediately to avoid transfer of the underlying shares to the IEPF Account. The shares transferred to the IEPF Account can be claimed back by the concerned member from IEPF Authority after complying with the procedure prescribed under the Rules.
MANDATORY TRANSFER OF SHARES IN DEMATERIALISED MODE
SEBI vide its notification no. SEBI/LAD-NRO/ GN/2018/24 dated June 08, 2018 had amended the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements), Regulations, 2015 and had mandated transfer of shares in dematerialised mode alone. This comes into effect from December 05,2018, hence the shareholders are requested to take note of it and take necessary steps to dematerialise your shares that are held in physical form and on or after December 05,2018 transfer of shares in physical mode will not be entertained.
DISCLOSURES
1. There has been no change in the nature of business of the Company during the year under review.
2. During the year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and Companyâs operations in future.
3. There were no Complaints filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
4. Pursuant to Section 197 (14) of the Companies Act,2013,neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries
5. The Report of the Statutory Auditors (which forms a part of this AnnuaL Report) and the Report of the SecretariaL Auditor (which is Annexed to this Directors Report) are seLf expLanatory having no adverse remarks/comments or discLaimer.
6. The Company maintains cost records as per Companies (Cost Records and Audit) Ruies,2014.
ACKNOWLEDGEMENT
The Board of Directors wishes to pLace on record their sincere appreciation to the customers, suppLiers, business partners and Subsidiaries and sharehoLders for their support. The Directors wouLd Like to thank the Bankers and financiaL Institutions as weLL. The Directors wouLd take this opportunity to express their appreciation for the dedicated efforts of the empLoyees and their contribution which is deepLy acknowLedged
For and on BehaLf of the Board of Directors
C C Paarthipan
Chairman
PLace : Chennai
Date : August 06, 2018
Mar 31, 2017
The Directors present their 26th Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31, 2017
Financial Highlights
RS, In Lakhs except EPS
Particulars |
Standalone For The Period Ended |
Consolidated For The Period Ended |
||
Twelve Months |
Nine Months |
Twelve Months |
Nine Months |
|
March 31, 2017 |
March 31, 2016 |
March 31, 2017 |
March 31, 2016 |
|
Sales (net of excise duty) and other Income |
35,394.13 |
23,476.54 |
41,148.33 |
24,238.13 |
Profit before Finance Costs, Tax, Depreciation & Amortization Expenses |
10,608.08 |
6,578.70 |
13520.79 |
6,764.00 |
Less: Finance Costs |
12.75 |
10.82 |
12.75 |
11.02 |
Depreciation & Amortization Expense |
1325.99 |
729.91 |
1329.84 |
747.78 |
Profit Before Tax |
9341.34 |
5,837.97 |
12,178.20 |
6005.20 |
Less: Tax Expenses |
2255.02 |
1,305.41 |
2,573.30 |
1428.28 |
Profit after Tax |
7086.32 |
4,532.56 |
9604.90 |
4,576.92 |
Less : Minority Interest |
- |
- |
(10.95) |
0.43 |
Add: Surplus at the beginning of the year |
9723.21 |
6,281.81 |
9723.13 |
6237.80 |
Profit available for Appropriation |
16809.53 |
10,814.37 |
19,338.98 |
10,814 |
Interim and final dividend |
- |
906.60 |
- |
906.60 |
Dividend Tax - Current Year |
- |
184.56 |
- |
184.56 |
Less: Deferred Employee Compensation Expenses. |
99.45 |
153.75 |
99.45 |
153.75 |
Balance carried to Balance Sheet |
16710.08 |
9,569.46 |
19,239.53 |
9,569.38 |
Paid up Capital |
1511.53 |
1511.00 |
1511.53 |
1,511.00 |
Reserves & Surplus |
18,443.47 |
11,302.85 |
20,908.17 |
11,302.77 |
19581.62 |
12,440.47 |
22,046.33 |
12,440.39 |
|
Earnings per Share-In Rupees |
9.381 |
29.992 |
12.73* |
30.28** |
Performance/Operations Review
The Company has on standalone basis registered total revenue from operations of RS,34436.07 Lakhs (Total income RS,35394.13 Lakhs) during the year under review as against RS,23129.22 Lakhs (Total income RS,23476.54 Lakhs) in the previous financial year of nine months. The Profit after tax was RS,7086.32 Lakhs during the year under review as against RS,4532.56 Lakhs in the previous financial year of nine months .
The Company has on consolidated basis registered total revenue from operations of RS,40164.84 Lakhs (Total income RS,41148.33 Lakhs) during the current financial year as against RS,23872.17 Lakhs (Total income RS,24238.13 Lakhs) in the previous financial year of nine months.
As required under Section 134(3)(i) of the Companies Act,2013 the state of Affairs of the Company and outlook has been discussed in Management Discussions and Analysis which is appended in this annual report pursuant to Regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015.
US FDA Approval:
During the year under review, our injectable facility (CP4) near Gummidipoondi, Chennai obtained US FDA approval. This facility is capable of manufacturing Liquid injectables in Vials, Ampoules, Lyophilized Vials and Opthalmic dosages, is also approved by EU-GMP and ANVISA-Brazil.
Dividend
The Board of Directors at their meeting held on May 10,2017 have recommended a dividend of H1.50 per equity share (75%) of H2 /- each . The said dividend if approved by the members at the 26th Annual General meeting which is to be held on September 21,2017 would absorb a total cash out flow of H11,33,65,125/-excluding Dividend Distribution Tax.
Transfer to Reserves
The Company has made no transfers to reserves during the Financial Year 2016-17
Subsidiaries
As on March 31,2017, the Company has three subsidiaries :
(i) Argus Salud Pharma LLP,
(ii) Caplin Point Far East Limited - Hongkong
(iii) Caplin Point Laboratories Colombia SAS-Colombia.
The consolidated financial results/ performance incorporating the financial statements of the above subsidiaries is attached to the annual report as required under the Accounting Standards and SEBI Regulations.
Further, a statement containing the salient features of the financial statements of our subsidiary pursuant to Section 129(3) of the Companies Act, 2013, in the prescribed Form AOC-1 is appended as Annexure I to the Board''s report.
Deposits
The Company did not accept any deposits from the public within the meaning of Chapter V of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014.
Share Capital
In October 2016, the Company had subdivided the shares from the face value of H10/- to H2/- and upon sub-division , the members were issued five equity shares of H2/- each in lieu of one equity share of H10/- each. After sub-division, the paid up capital of H15,11,00,000 was sub- divided into 7,55,50,000 equity shares of H2/- each.
During the year, the Company had allotted 26.750 equity shares at the face value of H2/-each under Caplin Point Employee Stock option Plan -2015.
Thus, as on March 31, 2017, the paid up share capital stood at H15,11,53,500/- consisting of 7.55.76.750 equity shares at the face value of H2/- each
Particulars of Loans, Guarantees or Investments Under Section 186 of The Companies Act, 2013
Particulars of loans, guarantees and investments as on March 31,2017 are given in Note No. 11 of the standalone financial statements.
Number of Meetings of the Board
The Board met four times during the year ended March 31,2017 which were held on 27.05.2016, 05.08.2016, 09.11.2016 and 06.02.2017.
The maxium gap between two meetings did not exceed 120 days.
Directors and Key Managerial Personnel
Dr Sridhar Ganesan''s (DIN : 06819029) present term of office as the Managing Director ends on August 24,2017 and the Board of Directors at their meeting held on August 07, 2017 have decided to re-appoint him for another term of three years commencing from August 25, 2017. The Board of Directors at their meeting held on February 06,2017 re-appointed Mr. M Jayapal (DIN: 01869677) as the Whole- time Director of the Company for another period of one year effective March 28,2017.
Dr Philip Ashok Karunakaran (DIN:06679664) was appointed as Whole-time Director by the Board of Directors at their Board Meeting held on August 07, 2017. The Company has received a notice from a member proposing his candidature for the position of Director.
Mr D Sathyanarayanan (DIN : 07650566) has been appointed as an Additional Director (Non-executive-Independent) of the Company for a period of three consecutive years with effect from November 09,2016. In the opinion of the Board of Directors he is eligible to be appointed as an Independent Director. The Company has received a notice from a member proposing his candidature for the position of Independent Director.
The members of the Company at their Twenty Third Annual General Meeting appointed Dr K C John (DIN: 01067374) as Non-executive-Independent Director for a period of three years effective August 25, 2014 and shall hold office till August 24, 2017. Pursuant to Section 149 (10) of the Companies Act, 2013 an Independent Director shall be eligible for re-appointment for a second term of five years by passing a Special Resolution by the members of the Company. Accordingly, Board of Directors at their meeting held on August 07, 2017 have re-appointed Dr K C John (DIN: 01067374) as an Independent Director for a second term of five consecutive years commencing from August 25,2017 and he is not liable to retire by rotation. In the opinion of the Board of Directors he is eligible to be re- appointed as an Independent Director. The Company has received a notice from a member proposing his candidature for the position of Independent Director.
The above appointments and re-appointments have been recommended by Nomination and Remuneration Committee and are subject to the approval of members at the ensuing Annual General Meeting.
Pursuant to Regulation 36(3) of SEBI (Listing Obligations and disclosure Requirements) Regulations, 2015 the profiles of these Directors seeking appointment / re-appointment are given in the Notice convening the 26th Annual General meeting In terms of Section 152 (6) of the Companies Act, 2013, Mr M Jayapal (DIN: 01869677) retires by rotation and being eligible offers himself for re-appointment.
Pursuant to section 2 (51) and Section 203 of the Companies Act,2013, Dr Sridhar Ganesan, Managing Director, Mr M Jayapal, Wholetime Director, Dr Philip Ashok Karunakaran, Whole-time Director Mr D Muralidharan , Chief Financial Officer and Mr Vinod Kumar
S, Company Secretary are the Key Managerial personnel of the Company.
Declaration by Independent Directors
The Independent Directors of the Company have submitted their declaration as required pursuant to Section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as stipulated in Section 149(6) of the Companies Act, 2013.
Extract of Annual Return
As required pursuant to Section 134 (3) (a) of the Companies Act, 2013, an extract of Annual Return in the prescribed Form MGT 9 is given as Annexure II to this Directors'' Report.
Directors Responsibility Statement
In terms of Section 134(5) of the Companies
Act, 2013, the Directors Confirms that:
a. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
b. The Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31,2017 and of the Profit of the Company for that period;
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. The Directors had prepared the annual accounts on a going concern basis;
e. The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
Nomination and Remuneration Committee (NRC) and its Policy
The Nomination and Remuneration Committee is empowered to authorize and exercise the power as specified in section 178 of the Companies Act, 2013. The Company has a policy on Directors appointment and remuneration including the criteria for determining the qualification, positive attributes and independence of a Director and other matters as provided under section 178(3) of the Companies Act,2013. The Nomination and Remuneration Committee policy is annexed in Annexure III of the Directors report
Material Changes and Commitments
There were no material changes and commitments, affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
Pursuant to Section 134 (3)(m) of the Companies Act,2013 read with in Rule 8 (3) of the Companies (Accounts) Rules, 2014 particulars of conservation of energy, technology absorption, foreign exchange earnings and outgo, as are given as Annexure IV to this Directors'' Report.
Annual Evaluation of The Board, its Committees and Individual Directors
Pursuant to the provisions of Section 134(3) (p)the Companies Act, 2013 and Schedule V of the Companies Act, 2013 the Board had carried out performance evaluation of its own, of the Board Committees and of the Independent directors .Independent Directors at their separate meeting held on February 06,2017 evaluated performance of the Non Independent Directors, Board as a whole and of the Chairman of the Board. The outcome of the evaluation process were satisfactory, which resulted in the active engagement of the Board and committees in the Company.
Further the Directors are regularly informed and familiarized during the Board Meetings about the activities of the Company and its operations, products and its development and latest trends in the pharmaceutical industry and issues faced by the industry.
Corporate Social Responsibility (CSR)
Pursuant to the provisions of section 135 of the Act, read with CSR Rules, the Company has constituted Corporate Social Responsibility Committee and based upon the recommendation of the CSR committee the Board of Directors have approved CSR Policy.
Disclosure under Companies (Corporate social responsibility policy) rules, 2014 is annexed as an Annexure V to this report.
Audit Committee
The Composition of the Audit Committee, meetings of the Audit Committee and their terms of reference of the Audit committee have been disclosed separately in the Corporate Governance Report which is annexed and forms part of this annual report.
Internal Financial Controls
The Company has designed and implemented adequate financial control systems with respect to the financial statements. During the year under review, no serious / adverse observation have been received from the Internal Auditors of the Company with respect to ineffectiveness or inadequacy of such controls.
Vigil Mechanism
The Company has established a vigil mechanism, through a Whistle Blower Policy, where Directors and employees can voice their genuine concerns or grievances about any unethical or unacceptable business practice. A whistle-blowing mechanism not only helps the Company in detection of fraud, but is also used as a corporate governance tool leading to prevention and deterrence of misconduct .It provides direct access to the employees of the Company to approach the Compliance Officer or the Chairman of the Audit Committee, where necessary. The Company ensures that genuine Whistle Blowers are accorded complete protection from any kind of unfair treatment or victimization. The Vigil mechanism policy is disclosed on the website of the Company
i.e(www.caplinpoint.net)
Auditors
Statutory Auditors
Pursuant to Section 139 of the Companies Act, 2013, the initial period of office of the Statutory Auditors, M/s. CNGSN & Associates LLP, Chartered Accountants, Chennai, concludes at the conclusion of 26th Annual General Meeting of the Company.
The Audit Committee and Board of Directors have recommended the re-appointment of M/s. CNGSN & Associates LLP, Chartered Accountants, Chennai (Firm reg no. 004915S/2200036) as the statutory auditors of the Company, subject to the approval of the Shareholders of the Company. The Company has received a certificate from the statutory auditors to the effect that ratification of their appointment, if made, would be in compliance with the requirements of the Companies Act, 2013 and the rules made there under.
The Statutory Auditors on appointment will hold office from the conclusion of 26th
Annual General Meeting to 31st Annual general Meeting which is subject to ratification by members at every Annual General Meeting .
A resolution for their re- appointment forms part of the Notice convening the 26th Annual General Meeting and the same is recommended for members approval.
Secretarial Auditor
Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Board of Directors of the Company appointed M/s. G Ramachandran & Associates, Company Secretaries, Chennai to conduct the secretarial audit of the Company. The Secretarial Audit Report (Form MR - 3) is given as Annexure VI to this Directors'' Report.
Corporate Governance
Pursuant to Regulation 34 of SEBI (Listing Obligations and Disclosure Requirements) Regulations,2015, a Report on Corporate Governance is given separately which forms a part of this Annual report.
Risk Management
The Board has designed and framed risk management approach through which it identifies and manages the risk parameters The senior level management periodically reviews the risk parameters through which key business risk are identified and addressed. A brief report on the Risk Management are referred in the Management Discussion and Analysis Report which forms a part of the Annual Report.
Employee Stock Option Plan
During the year under review , the Company has allotted 26,750 equity shares under Caplin Point Employee stock Option plan -2015 and the details required under Rule 12 (9) of Companies (Share Capital and Debentures)
Rules, 2014 and as required to be provided under the SEBI Guidelines as on March 31, 2017 are set out in Annexure VII to this Report.
The Board of Directors of the Company has proposed to institute new Employee Stock option Plan under the title " Caplin Point Employee Stock Option Plan -2017 " which is recommended for members approval at the ensuing 26th Annual General Meeting
Particulars of Employees and Related Disclosures
Particulars pursuant to Section 197(12) of Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is enclosed in the Annexure VIII to this Directors report.
Particulars of Contracts or Arrangements with Related Parties
All the related party transactions which were entered during the year under review were on arms length basis and in the normal course of Business. There were no material significant related party transactions made by the Company with its promoters, Directors, Key Managerial Personnel which may have potential conflict with the interest of the Company at large. No Material Contract or arrangements with the related party were entered during the year under review. All the related party transactions are reviewed by the Audit Committee . The required disclosures as per Accounting Standards 18 are disclosed in the Notes to Accounts of the Financial Statements. Particulars of Transactions with related parties, In prescribed form AOC -2 is enclosed as an Annexure IX of this Directors Report
The related party transaction policy has been uploaded on the website of the Company (www.caplinpoint.net)
Change In Registrar and Share Transfer Agents
In order to have ease in control and to render better service to the Investors, the Registrar and Share Transfer Agent Service (RTA) was shifted from Karvy Computer Share private Limited, Hyderabad to Integrated Registry Management Services Private Limited, Chennai with effect from July 20,2017.
Disclosures
1. There has been no change in the nature of business of the Company during the year under review.
2. During the year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.
3. During the Financial year 2016- 17, none of the employees were in receipt of the remuneration pursuant to Section 197(12) of Companies Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.
4. There were no complaints filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
5. Pursuant to Section 197 (14) of the Companies Act,2013,neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries
6. The Report of the Statutory Auditors (which forms a part of this Annual Report) and the Report of the Secretarial Auditor (which is Annexed to this Directors Report) are self explanatory having no adverse remarks/comments or disclaimer.
Acknowledgement
The Board of Directors wishes to place on record their sincere appreciation to the customers, suppliers, business partners and group companies and shareholders for their support. The Directors would like to thank the Bankers and financial Institutions as well. The Directors would take this opportunity to express their appreciation for the dedicated efforts of the employees and their contribution which is deeply acknowledged
For and on behalf of the Board of Directors
Date August 07, 2017 Dr Sridhar Ganesan M Jayapal
Place ChennaiManaging Director Whole-time Director
Mar 31, 2016
The Directors present their 25th Annual Report on the business and
operations of the Company and the accounts for Nine Months/ Financial
Year ended March 31, 2016.
FINANCIAL HIGHLIGHTS
Rs. In Lakhs except EPS
PARTICULARS STANDALONE FOR THE PERIOD CONSOLIDATED FOR THE
ENDED PERIOD ENDED
Nine Months Twelve months Nine Months Twelve Months
March, 31 2016 June, 30 2015 March, 31 2016 June, 30 2015
Sales (net
of excise
duty) and
other Income 23,476.54 24,297.20 24,238.13 25,479.92
Profit
before
Finance
Costs, Tax,
Depreciation 6,578.70 5,930.49 6,764.00 6,199.84
& Amortisation
Expenses
Less: Finance
Costs 10.82 22.79 11.02 23.04
Depreciation
&
Amortisation
Expense 729.91 827.92 747.78 837.93
Profit Before
Tax 5,837.97 5079.78 6005.20 5,338.87
Less: Tax
Expenses 1,305.41 986.22 1428.28 1,226.22
Profit after
Tax 4,532.56 4,093.56 4,576.92 4,112.65
Less : Minority
Interest - - 0.43 8.96
Add: Surplus
at the
beginning of
the year 6,281.81 3555.81 6237.80 3,501.64
Profit available
for Appropriation 10,814.37 7,649.37 10814.29 7,605.33
Less: Transfer
to General
Reserves - 409.39 - 409.36
Interim Dividend 377.75 - 377.75 -
Final Dividend
proposed 528.85 755.50 528.85 755.50
Dividend Tax
- Current Year 184.56 153.80 184.56 153.80
Adjustment on
account of
Depreciation, Net - 48.87 - 48.87
of taxes etc
Deferred employee
compensation
expenses 153.75 - 153.75 -
Balance carried
to Balance Sheet 9,569.46 6281.81 9,569.38 6,237.80
Paid up Capital 1511.00 1511.00 1,511.00 1,511.00
Reserves &
Surplus 11,302.85 7,852.40 11,302.77 7,808.39
Networth 12,440.47 8990.02 12,440.39 8946.01
Earnings per
Share-In Rupees 29.99 27.09 30.28 27.16
CHANGE IN FINANCIAL YEAR
The Companies Act 2013, requires every Company to have uniform period
of April to March as its Financial Year . Accordingly, the Audited
Financial Statements (Standalone & Consolidated) for the current
financial year have been prepared for the period of nine months
commencing from July 01, 2015 and ending on March 31, 2016. All the
current financial year data provided in this Directors Report is for
the period of Nine months only.
PERFORMANCE/OPERATIONS REVIEW
The Company has on standalone basis registered total revenue from
operations of Rs.23129.22 Lakhs during the financial year (Nine Months)
under review as against Rs.24022.80 Lakhs in the previous financial
year of twelve months. The Profit after tax was Rs.4532.56 lakhs during
the financial year (Nine months) under review as against Rs.4093.56
Lakhs in the previous financial year of twelve months .
The Company has made a consolidated turnover of Rs.23872.17 Lakhs
during the current financial year(Nine Months) as against Rs.25176.98
Lakhs in the previous financial year of 12 months.
As required under Section 134(3)(i) of the Companies Act,2013 the state
of Affairs of the Company and outlook has been discussed in Management
Discussions and Analysis with is appended in this annual report
pursuant to Regulation 34(2) of SEBI ( Listing Obligations and
Disclosure Requirements) Regulations,2015.
DIVIDEND
The Board of Directors of the Company at their Board meeting held on
February 05,2016, declared an Interim Dividend of Rs.2.50 per share (25
%) involving cash outflow of Rs.454.66 lakhs and the same was paid to
the shareholders on February 25,2016.Now your Directors are pleased to
recommend a Final Dividend of Rs.3.50 per share (35%) . This together
with the Interim Dividend aggregates to a sum of Rs.6 per share (60%)
for the FY 2015-16 , involving a total cash outflow (both Interim &
Final) of Rs.1091.16 lakhs including Dividend Distribution Tax.
The Board of Directors at their meeting held on August 05,2016 have
proposed sub-division of equity shares into equity shares of lower face
value.
TRANSFER TO RESERVES
The Company has made no transfers to reserves during the Financial Year
2015-16
SUBSIDIARIES
During the year, no company became or ceased to be a subsidiary of the
Company. The Company has one subsidiary LLP (i.e) Argus Salud Pharma
LLP
The consolidated financial results/ performance incorporating the
financial statements of the above subsidiary LLP is attached to the
annual report as required under the Accounting Standards and SEBI
Regulations.
Further, a statement containing the salient features of the financial
statements of our subsidiary pursuant to Section 129(3) of the
Companies Act, 2013, in the prescribed Form AOC-1 is appended as
Annexure I to the Board''s report.
DEPOSITS
The Company has not accepted any fixed deposits form the public.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF
THE COMPANIES ACT, 2013
Particulars of loans, guarantees and investments as on March 31,2016
are given in the Note No.12 to the standalone financial statements.
NUMBER OF MEETINGS OF THE BOARD
The Board met four times during the year ended March 31,2016 which were
held on 20.08.2015, 05.11.2015, 05.02.2016 and 17.03.2016.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
Based upon the recommendation of the Nomination and Remuneration
Committee, the Board of Directors at their meeting held on February
05,2016 have re-appointed Dr. R Ravichandran (DIN: 01920603) as an
Independent Director for a Second term of Five year commencing from May
12,2016 and he is not liable to retire by rotation and Mr. M Jayapal
(DIN :0186977) was re-appointed as the Whole- time Director of the
Company w.e.f. March 28.2016 for a period of one year.
Mr. D P Mishra (DIN : 02032818) term of office as a Whole-time Director
expired on April 30.2016 and has not sought re-appointment as a
whole-time Director. However, he continues to be a Director on the
Board w.e.f. May 01,2016 and necessary resolution was passed by the
Board of Directors of the Company for the Change in Designation.
In terms of Section 152 of the Companies act, 2013, Mr. C C Paarthipan
(DIN :01218784) retires by rotation and being eligible offers himself
for re-appointment.
During the year under review, Mr. P T Baby Thomas, Director (DIN
:03019018) resigned from the Board with effect from December 20,2015.
The Board places on record the appreciation and gratitude for the
guidance and contribution during his association with the Company.
Further to the resignation of Mr. Harihara Ponnambalam as the Chief
Financial Officer of the Company w.e.f. February 18,2016, Mr. D
Muralidharan was appointed as Chief Financial Officer of the Company
effective February 19,2016.
As on date, Dr. Sridhar Ganesan, Managing Director, Mr. M Jayapal,
Whole-time Director, Mr. D Muralidharan, Chief Financial Officer and
Mr. Vinod Kumar S, Company Secretary are the Key Managerial
personnel''s of the Company.
DECLARATION BY INDEPENDENT DIRECTORS
The Independent Directors of the Company have submitted their
declaration as required pursuant to Section 149(7) of the Companies
Act, 2013 stating that they meet the criteria of independence as
stipulated in Section 149(6) of the Companies Act, 2013.
EXTRACT OF ANNUAL RETURN
As required pursuant to Section 134 (3) (a) of the Companies Act, 2013,
an extract of Annual Return in the prescribed Form MGT 9 is given as
Annexure II to this Directors'' Report.
DIRECTORS RESPONSIBILITY STATEMENT
In terms of Section 134(5) of the Companies Act, 2013, the Directors
confirms that:
a. In the preparation of the annual accounts,the applicable Accounting
Standards had been followed along with proper explanation relating to
material departures;
b. The Directors had selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company as at March 31,2016 and of the Profit of the Company for
that period;
c. The Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
d. The Directors had prepared the annual accounts on a going concern
basis;
e. The Directors had laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively;
f. The Directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
NOMINATION AND REMUNERATION COMMITTEE (NRC) AND ITS POLICY
The Nomination and Remuneration Committee is empowered to authorize and
exercise the power as specified in section 178 of the Companies Act,
2013. The Company has a policy on Directors appointment and
remuneration including the criteria for determining the qualification,
positive attributes and independence of a Director and other matters as
provided under section 178(3) of the Companies Act,2013. The Nomination
and Remuneration Committee policy is annexed in Annexure III of the
Directors report.
MATERIAL CHANGES AND COMMITMENTS
There were no material changes and commitments, affecting the financial
position of the Company, which have occurred between the end of the
financial year of the Company to which the financial statements relate
and the date of the report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
Pursuant to Section 134 (3)(m) of the Companies Act,2013 read with in
Rule 8 (3) of the Companies (Accounts) Rules, 2014 particulars of
conservation of energy, technology absorption, foreign exchange
earnings and outgo, as are given as Annexure IV to this Directors''
Report.
ANNUAL EVALUATION OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS
Pursuant to the provisions of Section 134(3)(p) the Companies Act, 2013
and Schedule V of the Companies Act, 2013 the Board had carried out
performance evaluation of its own, of the Board Committees and of the
Independent Directors.Independent Directors at a separate meeting
evaluated performance of the Non-Independent Directors, Board as a
whole and of the Chairman of the Board. The outcome of the evaluation
process were satisfactory, which resulted in the active engagement of
the Board and committees in the Company,
Further the Directors are regularly informed and familiarised during
the Board Meetings about the activities of the Company and its
operations, products and its development and latest trends in the
pharmaceutical industry and issues faced in the industry,
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Pursuant to the provisions of section 135 of the Act, read with CSR
Rules, the Company has constituted Corporate Social Responsibility
Committee based upon the recommendation of the CSR committee the Board
of Directors have approved CSR Policy,
Disclosure under Companies (Corporate social responsibility policy)
rules, 2014 is annexed as an Annexure V to this report.
AUDIT COMMITTEE
The Composition of the Audit Committee, meetings of the Audit Committee
and their terms of reference of the Audit committee have been disclosed
separately in the Corporate Governance Report which is annexed and
forms a part of this annual report.
INTERNAL FINANCIAL CONTROLS
The Company has designed and implemented adequate financial control
systems with respect to the financial statements. During the year under
review, no serious / adverse observation have been received from the
Internal Auditors of the Company with respect to ineffectiveness or
inadequacy of such controls.
VIGIL MECHANISM
The Company has established a vigil mechanism, through a Whistle Blower
Policy, where Directors and employees can voice their genuine concerns
or grievances about any unethical or unacceptable business practice. A
whistle- blowing mechanism not only helps the Company in detection of
fraud, but is also used as a corporate governance tool leading to
prevention and deterrence of misconduct .It provides direct access to
the employees of the Company to approach the Compliance Officer or the
Chairman of the Audit Committee, where necessary. The Company ensures
that genuine Whistle Blowers are accorded complete protection from any
kind of unfair treatment or victimization. The Vigil mechanism policy
is disclosed on the website of the Company i.e (www.caplinpoint.net)
AUDITORS
STATUTORY AUDITORS
Pursuant to Section 139 of the Companies Act, 2013, M/s. CNGSN &
Associates LLP Chartered Accountants, Chennai, were appointed as
Auditors of the Company at the Twenty Third Annual General Meeting of
the Company for a consecutive period of three years commencing from
conclusion of 23rd Annual general Meeting. The Company has received a
certificate from the statutory auditors to the effect that ratification
of their appointment, if made, would be in compliance with the
requirements of the Companies Act, 2013 and the rules made there under.
Accordingly, the Audit Committee and the Board of Directors have
recommended to ratify their appointment as Statutory Auditors of the
Company for the financial year 2016-17.
A resolution seeking ratification of their appointment forms a part of
the Notice convening the 25th Annual General Meeting and the same is
recommended for shareholders approval.
SECRETARIAL AUDITOR
Pursuant to the provisions of Section 204 of the Companies Act, 2013
read with Rule 9 of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules 2014, the Board of Directors of the Company
appointed M/s. G Ramachandran & Associates, Company Secretaries,
Chennai to conduct the secretarial audit of the Company The Secretarial
Audit Report (Form MR - 3) is given as Annexure VI to this Directors''
Report.
CORPORATE GOVERNANCE
Pursuant to Regulation 34 of SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, a Report on Corporate Governance is
given separately which form a part of this Annual report.
LISTING AGREEMENTS
The Company has entered into new Listing Agreement with BSE Limited and
National Stock Exchange of India Limited as per the regulation 109 of
SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015.
The Company has paid the listing fees for the year 2016-17 to the Stock
exchanges where the shares of the Company are listed.
RISK MANAGEMENT
The Board has designed and framed risk management approach through
which it identifies and manages the risk parameters. The senior level
management periodically reviews the risk parameters through which key
business risk are identified and addressed. A brief report on the Risk
Management are referred in the Management Discussion and Analysis
Report which forms a part of the Annual Report.
EMPLOYEE STOCK OPTION PLAN
Details as required under Rule 12 (9) of Companies (Share Capital and
Debentures) Rules, 2014 and as required to be provided under the SEBI
Guidelines as on March 31, 2016 are set out in Annexure VII to this
Report
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Particulars pursuant to Section 197(12) of Companies Act, 2013 read
with Rule 5(1) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 is enclosed in the Annexure VIII to
this Directors report.
PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the related party transactions which were entered during the
Financial year under review were on arms length basis and in the normal
course of Business. There were no Material significant related party
transactions made by the Company with its promoters, Directors, Key
Managerial Personnel which may have potential conflict with the
interest of the Company at large. No Material Contract or arrangements
with the related party were entered during the Financial year under
review. All the related party transactions are reviewed by the Audit
Committee . The required disclosures as per Accounting Standards 18 are
made in the Notes to Accounts of the Financial Statements. Particulars
of transactions with the related parties, in prescribed form AOC -2 is
enclosed as an Annexure IX of this Directors Report.
The related party transaction policy has been uploaded on the website
of the Company (www. caplinpoint.net)
DISCLOSURES
1. There has been no change in the nature of business of the Company
during the year under review.
2. During the year under review, no significant and material orders
were passed by the regulators or courts or tribunals impacting the
going concern status and company''s operations in future.
3. During the Financial year 2015-16, none of the employees were in
receipt of the remuneration pursuant to Section 197(12) of Companies
Act, 2013 read with Rule 5(2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014.
4. There were no complaints filed pursuant to the Sexual Harassment of
Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
5. Neither the Managing Director nor the Whole- time Directors of the
Company receives any remuneration or commission from any of its
subsidiaries
6. The Report of the Statutory Auditors (Which Forms a Part of this
Annual Report) and the Report of the Secretarial Auditor (Which is
Annexed to this Directors Report) are Self explanatory having no
adverse remarks/ comments or disclaimer
ACKNOWLEDGEMENT
The Board of Directors wishes to place on record their sincere
appreciation to the customers, suppliers, business partners and group
companies and shareholders for their support. The Directors would like
to thank the Bankers and financial Institutions as well. The Directors
would take this opportunity to express their appreciation for the
dedicated efforts of the employees and their contribution which is
deeply acknowledged
FOR AND ON BEHALF OF THE BOARD
Place : Chennai C C PAARTHIPAN
Date : August 05,2016 CHAIRMAN
Jun 30, 2014
Dear Members,
The Directors present their Twenty Third Annual Report and the Audited
Financial Statement for FY 2013-14. As required under the Ministry of
Corporate Affairs' General Circular 08/2014 No. 1/19/2013-CL-V dated
April 4, 2014, the Financial Statements and other reports required to
be attached to the Annual Report for FY 2013-14 are governed by the
relevant provisions, schedules, rules of the Companies Act, 1956.
Director 's Report
FINANCIAL RESULTS
The Company's financial performance, for the year ended June 30, 2014
is summarised below:
Rs. in Lakhs except per share date
Standalone for the year
ended 30th
2014 2013
Saha (net of excise duty) and other Income 16.973.55 12.44Q.55
Profit before Finenw costs, Tax, Depreciation 3,693.57 2,327.10
& Amortisation Expenses
Less Finance costs 111.84 30.06 12.26
DaniwMai & Anwllgalon Expenses 343.89 145.32
Profit Before Tax 3.337.94 2,151,60
Less TaxEnjerrees 774,40 721.15
Profit after Tax 2.S63J54 1430.65
less: monorty interst 842 3.77075
Add: surpius at the beglnning ofthe year 2.057.61 1.21639
Profit avaliab,e for Approprialien 4,621.05 2.647.54
LesstTfaitsferfotjenaai Ftewrwe 340.00 160.00
Transfer from other reaserves 3,555.81 3501.64
paid up capital 1,61100 1.51.51
Reserves &Sumlus 4.717,00 2670.73
nwtworth 6.228.00 6.175
Earnings per Share 16.97 9.47
ConSOlidatod for the year
ended 30th June
2014 2013
Saha (net of excise duty) and other Income 176S2.37 12.91266
Profit before Finenw costs, Tax, Depreciation
& Amortisation Expenses 3,934.97 2,396.29
Less Finance costs 12.26 30.24
DaniwMai & Anwllgalon Expenses 353.63 154.03
Profit Before Tax
3669.06 2.21463
Less TaxEnjerrees
976.80 811,69
Profit after Tax
2,693.28 1.402.14
less: monorty interst
Add: surpius at the beglnning ofthe year
1,962.02 1.17366
Profit avaliab,e for Approprialien
4.55638 2,572.05
LesstTfaitsferfotjenaai Ftewrwe
340.00 150.00
Transfer from other reaserves 604.40 377.75
paid up capital 120.00 1.511.00
Reserves &Sumlus 4,662.86 2,803.24
networth 6173.86 4314.24
Earnings per Share 17.11 9.28
RESULTS OF OPERATION
India's economic growth rate rose to 4.7% in FY2014 from 4.5% in
FY2013.The Global operating environment improved considerably in
FY2013-14, as economic activity strengthened.
India tops the world in exporting generic medicines worth US$ 11
billion. Currently, the Indian Pharmaceutical industry is one of the
world's largest and most developed. Generics will continue to dominate
the market while patent - protected products are likely to constitute
10 per cent of the pie till 2015, according to Mc.Kinsey report'India
Pharma 2015- Unlocking the potential of Indian Pharmaceuticals market'.
On Standalone basis, the Company achieved a revenue of Rs. 16,973.52
Lacs as compared to Rs. 12,440.52 Lacs in previous year and the
Standalone operating profit before finance costs, depreciation & tax
was Rs.3,693.67 Lacs as compared to Rs. 2,327.18 Lacs in previous
year. Your Company achieved a growth of 36.43% in revenue and 58.71% in
operating profit as compared to the previous year.
On Consolidated basis, the Company achieved a revenue of Rs. 17,682.37
Lacs as compared to Rs. 12,912.86 Lacs in previous year and the
Consolidated operating profit before finance costs, depreciation & tax
was Rs.3,934.97 Lacs as compared to Rs.2,398.29 Lacs in the previous
year. A growth of 36.93% in revenue and 64.07% in operating profit as
compared to the previous year.
Director 's Report
DIVIDEND
Considering the Company's financial performance, the Directors have
recommended a dividend of Rs. 4/- per share (40%) {Previous Year - 25%}
on the capital of 1,51,10,000 Equity Shares of Rs. 10/- each for FY
2013-14. The said dividend, if approved by the Members, would involve a
cash outflow of Rs.725.24 Lacs {Previous Year - Rs. 441.95 Lacs}
including Dividend Distribution Tax.
CAPITAL STRUCTURE
The Company's Equity Share Capital stands at Rs. 1511.00 Lakhs
consisting of 1,51,10,000 Equity Shares of Rs 10/-each.
LISTING AT SROCK EXCHANGES
The Equity shares of your Company continue to be listed on Bombay Stock
Exchange Ltd (BSE), The Madras Stock Exchange Ltd (MSE)and also, with
effect from 23rd June, 2014 in National Stock Exchange Ltd (NSE).
The listing and custody fees for the year 2014-15 have been paid to the
stock exchanges and Depository(ies), respectively.
Your Company is pleased to provide members facility to exercise their
right to vote at the Twenty Third Annual General Meeting (AGM) by
electronic means and the business may be transacted through e-Voting
Services provided by M/s. Karvy Computershare Private Limited (KCPL)
though their website:- https://evoting.karvy.com
FIXED DEPOSITS
The Company has not accepted any public deposits during FY 2013-14.
SUBSIDIARY COMPANIES
A statement pursuant to Section 212 of the Companies Act, 1956,
relating to Subsidiary Companies, is attached to the Accounts. In
terms of General Exemption, under Section 212(8) of the Companies Act,
1956, granted by Ministry of Corporate Affairs vide its circular no.
02/2011 dated 8th February, 2011, and in compliance with the exemption
enlisted therein, the Audited Statement of Accounts, Auditors' Reports
thereon and the Reports of the Board of Directors of the Company's
subsidiaries for the financial year ended 31st March, 2014, have not
been annexed.
The Annual Accounts and related documents of the Subsidiary Companies
shall be kept open for inspection at the Registered Office of the
Company. The Company will also make available these documents upon
request by any Member of the Company interested in obtaining the same.
However, as directed by the said circular, the financial data of the
subsidiaries have been furnished in this Annual Report. Further,
pursuant to Accounting Standard (AS-21) issued by the Institute of
Chartered Accountants of India, Consolidated Financial Statements
presented by the Company in this Annual Report include the financial
information of its subsidiaries.
Brief information regarding the Subsidiary is as below:- Rs. in Lakhs
Name of subsdiary profit after tax profit after tax
(31st march 2014) 31st March 2013
(12 months) (12 months)
Argus LLp RS. 668.01 RS. 346.84
BOARD OF DIRECTORS J
CESSATION
Mr. R. Vijay Venkatraman, who was the Director of the Company since
October 10,2012, died on August 19,2014, in an untimely and tragic
manner. Mr. Vijay Venkatraman had made a considerable positive impact
on the Company's culture by spearheading leadership. The Directors have
placed on record their profound grief on the passing away of Mr. R.
Vijay Venkatraman.
APPOINTMENTS
Pursuant to the provisions of Section 161(1) of the Companies Act,
2013, Dr. R Ravichandran and Dr. KC John were appointed as Additional
Directors designated as Independent Directors w.e.f. May 12,2014 and
August 25,2014 respectively and they shall hold office up to the date
of the ensuing Annual General Meeting.
Further, pursuant to the provisions of Section 161 (1) of the Companies
Act, 2013, Dr. Sridhar Ganesan was appointed as an Additional Director
designated as an Independent Director w.e.f. February 12, 2014. The
Board of Directors requested Dr. Sridhar Ganesan to resign as an
Independent Director and to involve in the affairs of the Company on a
whole time basis. Hence, the Board appointed Dr. Sridhar Ganesan as an
Additional Director designated as Whole Time Director w.e.f August
25,2014 and he shall hold office up to the date of the ensuing Annual
General Meeting.
The Board of Directors has, pursuant to the provisions of Clause 49 of
the Listing Agreements entered into with Stock Exchanges, appointed Mr.
P. T. Baby Thomas, Mr. V. Thirumalai, Mr. Venkat Radhakrishnan, Dr. R
Ravichandran and Dr. K C John as Independent Directors of the Company.
The Company has received declarations from the said Independent
Directors of the Company confirming that they meet the criteria of
independence as prescribed both under sub-section (6) of Section 149 of
the Companies Act, 2013 and under the said Clause 49. In accordance
with the provisions of Section 149(4) and proviso to Section 152(5) of
the Companies Act, 2013, these Directors are being appointed as
Independent Directors to hold office as per their tenure of appointment
mentioned in the Notice of the forthcoming AG M of the Company.
The Company has received requisite notices in writing from members
proposing for appointment of the Directors mentioned above.
RE-APPOINTMENTS
The Board of Directors, subject to the approval of members,
re-appointed Mr. M Jayapal as Managing Director and Mr. D P Mishra as
Whole Time Director, for a period of 1 (One) year each with effect from
March 28, 2014 and May 1, 2014 respectively as their present term
expired on March 27, 2014 and April 30, 2014 respectively, according to
the terms and conditions as mentioned in the Notice.
In accordance with the requirements of the Act and the Articles of
Association of the Company, Mr. C C Paarthipan, Chairman, retires by
rotation and is eligible for re-appointment.
TRABSFER TO RESEVES
In terms of Companies (Transfer of Profits to Reserves) Rules, 1975, a
sum of Rs.340.00 lakhs (Rs. 150.00 Lakhs - previous year) was
transferred to General Reserves during the financial year.
AUDITORS AND AUDITORS' REPORT
M/s. CNGSN & Associates, 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 Company has received letter from them to the effect that their
re-appointment, if made, would be within the prescribed limits under
Section 141 (3)(g) of the Companies Act, 2013 and that they are not
disqualified for re-appointment.
The Notes on Financial Statements referred to in the Auditors' Report
are self-explanatory and do not call for any further comments.
COST AUDIRORS
The Company has appointed Mr. G. Thangaraj, Cost Accountant, as the
cost auditor of the Company for conducting the audit of cost records of
the Company for the financial year ended June 30,2014.
CORPORATIVE GOVERNANCE
A separate section on Corporate Governance and the certificate from the
Practicing Company Secretary confirming compliance of Corporate
Governance norms as stipulated in Clause 49 of the Listing Agreement
with the Stock Exchanges, forms part of the Annual Report.
CORPORATE SOCIAL RESPONSUBILITY COMMITTEE
Your directors have constituted the Corporate Social Responsibility
Committee (CSR Committee) comprising Mr. V Thirumalai, as the Chairman
and Mr. C C Paarthipan, Dr. Sridhar Ganesan as other members, according
to the provisions of Section 135 of the Companies Act, 2013.
The said Committee has formulated and recommended to the Board, a
Corporate Social Responsibility Policy (CSR Policy) indicating the
activities to be undertaken by the Company, to monitor the
implementation of the framework of the CSR Policy and to recommend the
amount to be spent on CSR activities as may be required.
IRECTORS ESPONSIBILm T EMEN
Pursuant to Section 217 (2AA) of the Companies Act, 1956 (the Act) the
Directors, confirm that:-
(i) in the preparation of the annual accounts, the applicable
accounting standards have been followed and that there are no material
departures;
(ii) they have, in the selection of the accounting policies, consulted
the Statutory Auditors and have applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a
true and fair view of the state of affairs of the Company at the end of
the financial year and of the profit of the Company for that period;
(iii) they have taken proper and sufficient care, to the best of their
knowledge and ability, for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act 1956,
for safeguarding the assets of th Company and for preventing and
detecting fraud and other irregularities;
(iv) they have prepared the annual accounts on a going concern basis.
PARTICULARS OF EMPLOYEES UNDER
SECTION 217(2A) OF THE COMPANIES ACT, 1956
During the year 2013-14, none of the employees were in receipt of
remuneration above the limits fixed in terms of Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975.
ANAGEMEN DISCUSSION N ANAUfSI REPO
The Management Discussion and Analysis Report on the operations of the
Company, as required under the Listing Agreement with the stock
exchanges is provided in a separate section and forms a part of this
Annual Report.
ENVIRONMENT SAFETY AND HEALTH
Your Company's framework integrates Safety as a non-negotiable value.
The Company provides a safe and healthy workplace for its employees by
establishing the right safety culture across the organization. The
Company has developed safer systems and procedures for work rolling out
up-to-date engineering standards and investing in hardware and safety
infrastructure across sites. The Company also ensures implementation of
quality systems and manufacturing of high quality products.
The Company continues to conserve resources by taking initiatives for
reducing consumption of electrical power, water and paper at the
Factories and also at Office premises.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION j AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
Details of energy conservation and research and development activities
undertaken by the Company along with the information in accordance with
the provisions of 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 given asanAnnexuretothe Directors' Report.
HUMAN RESOURCES
At Caplin, we believe that our success is due to the commitment and
passion of our most valuable asset - Our People. Our team is an amalgam
of the brightest peoples in the field that complement each other's
talents and work synergistically towards a unified goal of research
excellence. The diverse cultures, backgrounds, skills and experience of
our team bring great creative strength and energy to our business and
have a critical role to play in achieving our strategic objectives.
Company's industrial relations continued to be harmonious during the
year under review. The Company has generally enjoyed cordial relations
with its employees and workers.
APPRECIARTIONS AND ACKNOWLEDGED
Your Directors place on record their deep appreciation to employees at
all levels for their hard work, dedication and commitment. The
enthusiasm and unstinting efforts of the employees have enabled the
Company to progress at this level. The Board places on record its
appreciation for the support and co-operation your Company has been
receiving from its Company's Customers, Manufacturers, Dealers and
others associated with the Company.
The Directors also take this opportunity to thank all Investors,
Clients, Banks, Central and State Governments of Tamilnadu, Puducherry
and Himachal Pradesh and Regulatory Authorities and Stock Exchanges,
for their continued support.
By Order of the Board of Directors
For Caplin Point Laboratories Limited
Registered Office:
"Narbavi " No.3 Lakshmanan Street,
T Nagar, Chennai - 600 017 S Mohan Raj
Date: November 12, 2014 Chief Financial Officer & Company Secretary
Jun 30, 2013
To the Shareholders
The Directors have pleasure in presenting the Twenty Second Annual
Report together with the Audited Accounts for the year ended 30" June
2013.
FINANCIAL RESULTS
Rs. In Lakhs except per share data
Standalone for the Consolidated for the
year ended 30th June year ended 30,h June
2013 2012 2013 2012
Sales (net of excise
duty) and other 12,440.52 11,001.01 12,912.86 10,972.34
Income
Profit before
Finance Costs, 2,327.18 1,286.86 2,39829 1,330.34
Depreciation,
Amortisation
Expenses & Taxes
Depreciation &
Amortisation 145.32 115.50 154.02 123.66
Expense
Profit Before Tax 17.24
Less: Tax Expenses 721.15 265.16 811.89 314.25
Add: Surplus at the
beginning of 1,216.89 834.60 1,173.65 809.22
the year
Profit Apgropriation 2,647.54 1,653.11 2,57213 1609.87
Less: Transfer to
Genera Reserves 150.00 85.00
Final Dividend
proposed
Dividend Tax Current Year 6420 49.02 64.20 49.12
Transfer from other
Reserves
Balance carried to
Balance Sheet 2,05751 1,216.89 1,982.02 73.65
Reserves & Surplus 1,84679
Netvvorth 4,389.73 3,401.03 4,31424 3,357.79
Earnings per Share
OPERATIONS & OUTLOOK
During the Financial year under report, the company posted an excellent
financial performance.
At standalone level, our profit after tax amounted to Rs 1,430.65 lakhs
(11.49% of revenue) as against Rs 818.51 lakhs (PY 7.44% of revenue),
thus representing an increase of 54% over the previous year. On
consolidated basis, our profit after tax amounted to Rs 1,398.40 lakhs
(10.82% of revenue) as against Rs 800.65 lakhs (PY 7.29% of revenue).
The net worth of the company has increased to Rs 4,389.73 lakhs from
Rs. 3,401.03 lakhs. The EPS has improved to Rs 9.47 (Rs 5.42 PY) for
standalone and Rs 9.28 (Rs 5.30 PY) for the group.
OUTLOOK
With India becoming a hub for manufacturing and research operations,
your company is poised for growth. In 2012, your Company commenced a
project for setting up of a state of the art injectable plant which
will cater to highly regulated markets like USA , EU, Brazil, South
Africa etc. The facility is designee! with a high level of
sophistication and automated process control and will be in compliance
with norms stated by USFDA , UK MHRA, ANVISA BRAZIL, EU GMPand other
regulatory bodies. Upon commencement of commercial production in this
facility, your Company would also be in a position to offer Contract
manufacturing services in the areas of general category injectable
dosage forms in Vials, Ampoules, Lyophilized Vials, Pre filled syringes
and Ophthalmic preparations. Your Company expects to commence trial
production by December 2013 and pilot production batches by January
2014. With facilities available to cater to all segments of domestic
and export markets, your Company has recently entered into an agreement
to cater to the Brazilian Pharmaceutical Market for these products.
Your Company can provide them supplies at competitive prices which is
expected to significantly contribute to the future business.
Your Company as part of the current expansion plans at the
manufacturing unit at Puducherry, is in the process of setting up
dedicated lines in the areas of Suppositories, Soft gelatin capsule and
Penems which will commence production during the Fourth quarter of this
year.
Your Company''s manufacturing unit at Baddi in the state of Himachal
Pradesh is situated in the notified area under notification number S.O.
1269(E) dated 4''" November, 2003 and continue to enjoy Central Excise
and Income Tax benefits.
SHARE CAPITAL
At the end of the financial year the Company''s Equity Share Capital
stands at Rs. 1511.00 Lakhs consisting of 15,110,000 Equity Shares of
Rs 10/ each.
DIVIDEND
The Board of Directors are pleased to recommend a dividend of Rs. 2.50
per Equity Share of Rs.10/ each [25%] for the year ended June 30, 2013
subject to approval of the shareholders in the ensuing Annual General
Meeting. The dividend if approved, at the Annual General Meeting will
be tax free in the hands of the shareholders. The payment of dividend
would entail a cash outflow of Rs. 441.95 Lacs including dividend
distribution tax of Rs. 64.20 Lacs.
DIVIDEND HISTORY
TRANSFER TO RESERVES
In terms of Companies (Transfer of Profits to Reserves) Rules, 1975, a
sum of Rs.150.00 lakhs (Rs. 85.00 Lakhs previous year) was transferred
to General Reserves during the financial year.
SUBSIDIARY COMPANIES
As per Section 212 of the Companies Act, 1956, we are required to
attach the Directors" Report, Balance Sheet and Profit and Loss Account
of our subsidiary to our annual report.
The Ministry of Corporate Affairs, Government of India vide its
circular no. 2/2011 dated February 8 ,2011 provided an exemption to
companies from complying with Section 212, provided such companies
publish the audited consolidated financial statements in the annual
report. Accordingly, the annual report 2012 13 does not contain the
financial statements of our subsidiary. However, the statement as
required under Section 212 of the Companies Act, 1956 in respect of the
Subsidiaries of the Company is annexed and forms part of this Report.
The audited annual accounts and related information of our subsidiary,
where applicable, will be made available for inspection during office
hours on all working days (except Saturdays, Sundays and Public
holidays) between 11.00 a.m. to 01.00 p.m. up to the date of the Annual
General Meeting.
The consolidated financial statements, in terms of Clause 32 of the
Listing Agreement and prepared in accordance with Accounting Standard
21 as specified in Companies (Accounting Standards) Rules, 2006 also
forms part of this annual report.
CORPORATE GOVERNANCE
Your Company is committed to maintain high standards of Corporate
Governance. A separate section on Corporate Governance forming part of
the Directors Report and the certificate from Practicing Company
Secretaries confirming compliance of Corporate Governance norms as
stipulated in Clause 49 of the Listing Agreement with Madras Stock
Exchange Limited (MSE) and Bombay Stock Exchange Ltd., (BSE) is
included in the Annual Report
CORPORATE SOCIAL RESPONSIBILITY
Today, society expects corporate to go beyond the statutory compliances
and putting something back into society. Caplin Point as a Company is
aware of the expectation from the society with respect to social
commitment.
Your Company is committed to developing its business towards
ecological, social and economic sustainability. Your Company rather
sees Corporate Social Responsibility as a new business strategy to
reduce investment risks and maximise profits by taking all the key
stakeholders into confidence. All activities and initiatives are
planned specific to the needs of the target stakeholders. The ultimate
objective is to see that each business decision takes into account its
social impact and accordingly plans an intervention to mitigate the
impacts arising out of that decision. As a part of initiative, we have
installed at Caplin Point''s manufacturing facilities the most advanced
anti pollution devices to keep the environment in and around the
manufacturing facilities clean and green.
MANAGEMENT DISCUSSION AND ANALYSIS
Pursuant to clause 49 of the Listing Agreement with the Stock
Exchanges, we annex herewith a Statement on Management Discussion and
Analysis which forms part of the Directors'' report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The informations required under section 217(1 )(e) of the Companies
Act, 1956 read with the Companies (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988 are given in the Annexure
forming part of this report.
PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT,
1956
During the year 2012 13, none of the employees were in receipt of
remuneration above the limits fixed in terms of Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975 in the said section.
QUALITY INITIATIVES
Quality and best practices define the foundation of a company. Caplin
point has a comprehensive quality policy which ensures that the quality
consciousness and culture is spread across the company. The following
initiatives have helped the company to leverage its pursuit towards
implementation of quality systems and manufacturing of high quality
products.
A "Corporate Quality Assurance" unit has been set up by Caplin point to
function independently and report to the board on matters related to
quality.
The Quality assurance teams in our manufacturing sites are also being
strengthened and expanded.
A standard procedure for "Vendor evaluation" implemented to ensure that
all the materials are supplied by approved vendors and with right
quality consistently.
"Contract manufacturing sites" are being audited for the GMP
implementation before entering into any commercial agreement.
"Quality Management system" has been implemented across all
manufacturing units. All the incidents, deviations, failures are
recorded and investigated. The corrective and preventive actions are
properly implemented.
"Training programs" on GMP, QMS and process related SOPs are being
conducted in all units
"Finished Goods release inspections" are being conducted meticulously
by all units.
"Product Development" ( R&D) has been given lot of importance and a
dedicated facility has been created in Gummidipoondi in Chennai.
"Product Stability studies" are being conducted as per the
international requirements (ICH guidelines) and the data is evaluated
periodically.
Studies for"Process improvements" are being done in the new R&D lab.
"Quality control laboratories" are being equipped with sophisticated
equipments like HPLCs, stability chambers etc.,
FIXED DEPOSITS
The Company has not accepted any fixed deposits and, as such, no amount
of principal or interest was outstanding as of the Balance Sheet date.
DIRECTORS
Retirement by rotation
In accordance with the requirements of the Companies Act, 1956 and
Article 99 of Articles of Association of the Company, Mr. P. T. Baby
Thomas, Director of the Company will retire by rotation at the ensuing
Annual General Meeting and being eligible, offer himself for re
appointment.
Re Appointment of Mr, M.Jayapal as Managing Director
In view of the 2 year tenure of Mr. M. Jayapal as Managing Director of
the Company coming to an end on 27th March 2013, the Board of Directors
of the Company had at its meeting held on 9''" May, 2013 approved the re
appointment of Mr. M. Jayapal as Managing Director of the Company for a
further period of 1 year with effect from 28th March 2013 on a
remuneration of Rs. 59,400/ p.m.
DIRECTORS'' RESPONSIBILITY STATEMENT AS REQUIRED UNDER SECTION 217 (2AA)
OF THE COMPANIES ACT, 1956
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors
confirm that:
(i) they accept responsibility for the integrity and objectivity of
these accounting statements;
(ii) the financial statements are prepared in accordance with the
guidelines and standards of the ICAI and Companies Act 1956, to the
extent applicable. There are no material departures from the above
mentioned standards;
(ii) such standard accounting policies have been applied consistently,
except as otherwise stated;
(iv) the judgments and estimates have been made on a reasonable and
prudent basis so that the financial statements provide a true and fair
view of the state of affairs of the Company at the end of the financial
year;
(v) the directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
(vi) the Annual Accounts are prepared on agoing concern basis and on an
accrual basis.
AUDITORS
The Auditors, M/s. M. Raghunath & Co, Chartered Accountants, Chennai ,
who retire at the conclusion of the ensuing Annual General Meeting have
expressed their desire not to seek re appointment. Notice has been
received from a Member proposing the appointment of M/s CNGSN &
Associates, Chartered Accountants as Auditors of the Company to hold
office till the conclusion of the next Annual General Meeting. M/s
CNGSN & Associates have given their consent to be the Auditors of the
company and have also confirmed that their appointment will be in
accordance with the limits specified in Section 224(1 B) of the
Companies Act 1956.
CNGSN & Associates is a firm of Chartered Accountants providing
comprehensive audit, taxation and consulting services, established in
1990 in Chennai, India.
Accordingly the notice for appointment of CNGSN & Associates have been
proposed along with the letter received from a Member proposing their
appointment as Statutcy Auditors.
COST AUDITOR
Mr. G.Thangaraj, Cost Accountant, has been appointed as the Cost
Auditor for audit of the cost accounting records of the Company for the
financial year ended June 30, 2013. The Cost Audit Reports relating to
the financial year 2012 2013 shall be filed within the stipulated time
period.
INDUSTRIAL RELATIONS
Generally the Industrial relations with the employees of the Company
continued to be stable, cordial and satisfactory during the financial
year.
ENVIRONMENTAL AWARENESS
"Go Green" initiatives to conserve resources has been initiated in the
Company. Steps required for conserving power across all Factories are
being undertaken. The Company has also taken initiatives within its
office buildings to reduce electrical power, water and paper
consumption. These initiatives shall be taken forward at a sustained
pace.
ACKNOWLEDGEMENT
Your Directors place on record their sincere thanks to the Central
Government and State Governments of Tamilnadu, Puducherry and Himachal
Pradesh for their continued support to the Company.
Your Directors wish to thank the Company''s Customers, Manufacturers,
Dealers, Banks and Shareholders for their continued support to your
Company''s performance and growth. Your Directors also wish to place on
record their appreciation of the contribution made by all the employees
of the Company resulting in good performance during the year under
review.
On behalf of the Board of Directors
Place: Chennai C C Paarthipan M Jayapal
Date : November 7, 2013 Chairman Managing Director
Jun 30, 2012
To the Shareholders
The Directors have pleasure in presenting the Twenty First Annual
Report together with the Audited Accounts for the year ended 30th June
2012.
Financial Performance
Particulars 2011-2012 2010-2011
Sates (net of excise duty)
and other Income 11001.01 8557.52
Profit before Finance Costs,
Tax, Depreciation 1286.86 1163.04
& Amortisation Expenses
Less: Finance Costs 87.69 100.22
Depreciation & Amortisation Expense 115.50 227 72
Profit Before Tax 1083.67 835.10
Less: Tax Expenses 265.16 181.19
Profit after Tax 818.51 653.61
Add: Surplus at the beginning of the year 834.60 509.77
Profit available for Appropriation 1653.11 1163.38
Less: Transfer to General Reserves 85.00 65.36
Final Dividend proposed 302.20 226.65
Dividend Tax - Current Year 49.02 36.77
Balance carried to Balance Sheet 1216.89 834.60
Return on Net worth - Earnings Per Share
Basic / Diluted 5.42 4.33
OPERATIONS & OUTLOOK
We are glad to inform the Members that the Company has crossed the
milestone of 100 CRORE Revenue Mark in the year under review. This has
been achieved mainly on account of our deep inroads in Southern and
Central America, Company's growing market presence, innovative
marketing strategies and introduction of new product. It is hoped that
with the continued efforts in exploring new markets/products in the
established markets, the growth will be sustained during the coming
years.
In addition, the Company has added substantial machinery/equipment at
the unit of the Company at Pondicherry. Considering the status of the
plant and the productivity, subsequent to the close of the year our
facility at Gummidipoondi is being revamped and during the interregnum
period due to investment in balancing machinery at Pondicherry there
shall not be any effect on the overall production target during the
current year.
completion and expected to commence trial run during the Third/fourth
quarter of the current year. Senior technical personnel have already
been recruited and plans are under way for preparation for approval of
the plant and registration of product lines with the regulatory
authorities.
DIVIDEND
The Board of Directors is pleased to recommend a dividend of Rs.2/- per
Equity Share of Rs.10 each [20%] for the year ended June 30, 2012
subject to approval of the shareholders in the ensuing Annual General
Meeting. The dividend if approved, at the Annual General Meeting will
be tax free in the hands of the shareholders. The payment of dividend
would entail a cash outflow of Rs. 351.22 Lacs including dividend
distribution tax of Rs. 49.02 Lacs.
TRANSFER TO RESERVES
In terms of Companies (Transfer of Profits to Reserves) Rules, 1975, a
sum of Rs.85.00 lacs was transferred to General Reserves during the
financial year.
DIRECTORS
Re-Appointment
In accordance with the requirements of the Companies Act, 1956 and
Articles of Association of the Company, Mr.C.C.Paarthipan, Director of
the Company will retire by rotation at the ensuing Annual Genera!
Meeting and being eligible have offer himself for re-appointment. The
Board recommends his re-appointment.
Aprication
As per the resolution passed by the Board of Directors on 30th April
2012, Mr. D.P. Mishra was re-designated and appointed as Whole Time
Director of the Company effective from Is' May 2012 for a period of two
years subject to approval of the shareholders at the ensuing Annual
General Meeting.
Subsequent to the close of the year, Mr. N.R. Achan resigned as a
Director with effect from 4n October 2012 and Mr. R. Vijay Venkatraman
was appointed as a Director of the Company in his place with effect
from 4'" October 2012. The Board of Directors wish to place on record
its deep appreciation for the valuable services rendered by
Mr.N.R.Achan.
As required under Clause 49 of the Listing Agreement relating to
Corporate Governance, a brief resume, expertise and details of other
directorships of Messrs.CC.Paarthipan and D.P.Mishra are provided in
the Notice of the ensuing Annual General Meeting.
DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors, in accordance with the provisions of Section 217(2AA)
of the Companies Act, 1956, confirm that:
1) Applicable accounting standards have been followed in the
preparation of the Annual Accounts;
2) The Directors have adopted such accounting policies and have applied
them consistently and have made judgments and estimates in a reasonable
and prudent manner so as to give a true and fair view of the state of
affairs of the Company as at the end of the financial year, and of the
profit of the Company for the year ended 30.06.2012.
3) Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
prevention and detection of fraud and other irregularities. To ensure
this, the company has established internal control systems, consistent
with its size and nature of operations, subject to the inherent
limitations that should be recognized in weighing the assurance
provided by any such system of internal controls. These systems are
reviewed and updated on an ongoing basis. Periodic internal audits are
conducted to provide reasonable assurance of compliance with these
systems. The audit committee meets at regular intervals to review the
internal audit function.
4) The annual accounts have been prepared on a going concern basis.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from the public.
AUDITORS
The Auditors, Messrs. M. Raghunath and Company, Chartered Accountants,
Chennai, retire at the conclusion of the ensuing Annual General Meeting
and being eligible offer themselves for re-appointment.
The Board on recommendation of the Audit Committee, proposes that
Messrs.M.Raghunath and Company, Chartered Accountants, Chennai, be
appointed as Statutory Auditors of the Company to hold office till the
conclusion of the next Annual General Meeting of the Company. Messrs.
M. Raghunath and Company, Chartered Accountants, Chennai have forwarded
their certificate to the company stating that their appointment, if
made, will be within the limit specified in that behalf in sub-section
(IB) of Section 224 of the Companies Act, 1956.
COST AUDITORS
Mr. G.Thangaraj, Cost Accountant, has been appointed as the Cost
Auditor for audit of the cost accounting records of the Company for the
financial year ended 30.06.2012. The Cost Audit Reports relating to the
financial year 2011-2012 will be filed within the stipulated time
period.
CORPORATE GOVERNANCE
Your Company is committed to maintain high standards of Corporate
Governance. A separate section on Corporate Governance is included in
the Annual Report and the Certificate from M/s. R Sridharan &
Associates, Company Secretaries confirming the compliance of conditions
on Corporate Governance as stipulated under Clause 49 of the Listing
Agreement of the Stock Exchange is annexed thereto.
INDUSTRIAL RELATIONS
Generally the Industrial relations with the employees of the Company
continued to be stable, cordial and satisfactory during the financial
year.
PARTICULARS UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956
The information required in terms o f Section 217(2A) of the Companies
Act, 1956 read >vitr-the Compares (Particulars of Employees) Rules,
1975 is not applicable to this Company, since none of the employees
werreceipt of remuneration higher than the limits fixed in the said
section.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information required under section 217(l)(e) of the Companies Act,
1956 read with Companies. (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988 is given in the /anrexure
forrrr.g na-t of this report.
ACKNOWLEDGEMENT
The Directors wish to thank the Company's Customers, Manufacturers,
Dealers, Banks, Shareholders and Government for their continued support
to your Company's performance and growth. The Directors also wish to
place on record their appreciation of the contribution made by all the
employees of the Commny resulting in gcod performance during the year
under review.
On behalf of the Board of Directors
Place: Chennai C C Paarthipan
Date; November 9, 2012 Chairman
Jun 30, 2011
The Directors have pleasure in presenting the Twentieth Annual Report
together with the Audited Accounts for the year ended 30th June 2011.
Financial Performance
(Rupees in lacs)
2010-2011 2009-2010
Sales and Other Income 8557.50 6246. 00
Profit before Tax 835.10 364.83
Profit after Tax 653.61 333.18
Key Financial Ratios
Net worth 2933.74 2543.55
Current Ratio 1.48 1.64
Debt Equity 0.33 0.41
Return on Net worth
Earnings per Share
Basic & Diluted 4.33 2.21
OPERATIONS & OUTLOOK
During the year under review there has been substantial improvement in
the sales turnover and profits of the Company. As in the previous years
the focus was principally on the established and new export geographies
in Southern and Central America, where the Company's growing market
presence, strong brand equity, innovative marketing strategies and new
product pipe line are yielding rich returns. The efforts at reaching
out to newer markets in other countries in South America and Africa
where the Company hitherto did not have a significant presence has
gained momentum. The outcome of these major marketing initiatives are
already beginning to be felt in the form of higher turnover and
profits.
The Company in order to sustain growth and competition has several
initiatives in the territories where they are established, by offering
healthcare and allied products which would result in additional revenue
and retention of customers.
We are glad to inform you that, M/s Argus Salud Pharma LLP ,the Limited
Liability Partnership Firm set up by the Company as a subsidiary for
the manufacture of pharmaceutical formulations at Baddi, Himachal
Pradeshn which has become fully operational in the course of this year
and has started contributing handsomely to the profits of the Company.
In addition, the other established units of the Company at Pondicherry
and Gummidipoondi have also attained higher levels of production and
profitability during the year.
In connection with the planned expansion into the manufacture of
injectibles intended for export to regulated markets, the Company has
put in focused efforts over the past year in building a world class
injectible unit, which would be in compliance with the stringent
standards of the regulated markets and it is expected that the project
would get completed during the current financial year so as to begin
the process of obtaining approvals for regulated markets and to
commence commercial production thereafter.
RESEARCH AND DEVELOPMENT
In order for the Company to improve its processes, product enhancement
and newer applications, a dedicated Research and Development team is
being set up and towards this end, several senior technical
professionals have been appointed and a separate R&D wing in the
proposed expansion is under construction and will be in a position to
commence its activities during the third quarter of this year.
DIVIDEND
The Board of Directors is pleased to recommend a dividend Rs. 1.50 per
Equity Share of Rs. 10 each [15%] for the year ended June 30, 2011
subject to approval of the shareholders in the ensuing Annual General
Meeting. The dividend if approved, at the Annual General Meeting will
be tax free in the hands of the shareholders. The payment of dividend
will entail a cash outflow of Rs" 263.42 Lacs including dividend
distribution tax of Rs 36.77 Lacs.
TRANSFER TO RESERVES
In terms of Companies (Transfer of Profits to Reserves) Rules, 1975, a
sum of Rs. 65.36 Lacs was transferred to General Reserves during the
financial year.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Industry Structure and Development / Opportunity - Threat, Risk &
Concerns
The Company is engaged in the manufacture of Pharmaceutical
Formulations and is specifically a manufacturer of generic dosages with
significant exposure and direct presence in the overseas markets such
as South / Central America and West Africa. Unlike other SME's in the
Pharmaceutical sector, your Company has, by virtue of its presence in
these underpenetrated markets and on account of being able to sustain
its operations and extract higher profits through efficient resource
management, managed to carve a niche for itself in the pharmaceutical
manufacturing industry. This would, in turn, lead to greater market
presence and better profitability in future. However the perils posed
by the unpredictable fluctuations in foreign currencies during the
present global economic problem present a material threat to the
earnings of the Company.
Internal Control Systems and their Adequacy
The Company maintains a system of internal control, including suitable
monitoring procedures. The management duly considers and takes
appropriate action on recommendations made by the Statutory Auditors,
Internal Auditors and independent Audit Committee of the Board of
Directors. Significant issues are also brought to the attention of the
Audit Committee.
Outlook for the year 2011-12
The Company's sustained focus on quality of products and effective
market strategies coupled with the expansion plans would, very shortly,
propel the Company into the select league of niche manufacturers of
pharmaceutical formulations catering to the needs of the regulated
markets. The resulting outcomes in terms of quality improvement,
greater production efficiencies and better recognition in the markets
for the Company's products augur well for the future growth of your
Company.
Consolidated Financial Statements of Subsidiary
The Consolidated Financial Statements of the Company and its
Subsidiary,viz., Argus Salud Pharma LLP, prepared in accordance with
the Accounting Standards (AS - 21) prescribed by the Institute of
Chartered Accountants of India are attached and form part of the Annual
Report and Accounts.
Subsidiary
The Company had promoted a Subsidiary Limited Liability Partnership,
Argus Salud Pharma LLP at an investment of Rs. 4,95,000 which
constitutes 99 per cent of the capital thereof, to manufacture and
market pharmaceutical formulations which is now fullv operational and
yielding profits.
The Ministry of Corporate Affairs has, vide General Circular No. 2/2011
dated 8th February 2011, pursuant to Section 212(8) of the Companies
Act, 1956 granted a general exemption from attaching a copy of the
Balance Sheet, Profit & Loss Account, Report of the Board of Directors
and Report of the Auditors of the subsidiary along with that of the
Holding Company and hence the same have not been attached herewith.
However, the statement as required under Section 212 of the Companies
Act, 1956 in respect of the Subsidiaries of the Company is annexed and
forms part of this Report. The Annual Accounts of the Subsidiary will
be made available to any shareholder requiring a copy of the same at
any point of time. The Annua) Accounts of the Subsidiary will also be
kept for inspection by shareholders at its Registered Office. i
Cautionary Note
Certain statements in the "Management Discussion and Analysis" section
may be forward looking and are stated as required by applicable laws
and regulations. Many factors may affect the actual results, which
could be different from what the Directors' envisage in terms of future
performance and outlook.
DIRECTORS
Re-Appointment
Shri. V. Thirumalai and Shri. D. P. Mishra, Directors, retire by
rotation at the ensuing Annual General Meeting and being eligible,
offer themselves for re-appointment.
Appointments
Mr. Venkat Radhakrishnan and Mr. N R Achan were appointed as Additional
Directors of the Company effective from 28th June 2011 and 31st October
2011 respectively to hold office upto the date of the ensuing Annual
General Meeting.
The Company has received notices in writing along with a deposit of
Rs.500/- each from member(s) of the Company under Section 257 of the
Companies Act, 1956, proposing the appointments) of Messrs. Venkat
Radhakrishnan and N R Achan, as Directors of the Company. The Board
recommends their appointment for approval of the members.
As required under Clause 49 of the Listing Agreement relating to
Corporate Governance, a brief resume, expertise and details of other
directorships of Messrs. V Thirumalai, D P Mishra, Venkat Radhakrishnan
and N R Achan are provided in the Notice of the ensuing Annual General
Meeting.
Re-Appointment of Mr. M. Jayapal as Managing Director
In view of the 3 year tenure of appointment of Mr. M. Jayapal as
Managing Director of the Company coming to an end on 27th March 2011,
the Board of Directors of the Company had at its meeting held on 21st
March 2011 approved the re-appointment of Mr. M. Jayapal as Managing
Director of the Company for a further period of 1 year with effect from
28th March 2011 on a remuneration of Rs. 50,500/- p.m.
Subsequently, in partial modification of the earlier resolution, the
Board at its meeting held on 21st November 2011, approved the revision
of the tenure of appointment of Mr. M. Jayapal as Managing Director of
the Company for a period of two years effective from 28th March 2011 on
the same terms of remuneration as approved earlier. *
Accordingly the ordinary resolution is set out in Item No. 9 of the
notice for the consideration and approval of the members.
DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors, in accordance with the provisions of Section 217(2AA)
of the Companies Act, 1956, confirm that:
1) Applicable accounting standards have been followed in the
preparation of the Annual Accounts;
2) The Directors have adopted such accounting policies and have applied
them consistently and have made judgements and estimates in a
reasonable and prudent manner so as to give a true and fair view of the
state of affairs of the Company as at the end of the financial year,
and of the profit of the Company for the year.
3) Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
prevention and detection of fraud and other irregularities. To ensure
this, the company has established internal control systems, consistent
with its size and nature of operations, subject to the inherent
limitations that should be recognized in weighing the assurance
provided by any such system of internal controls. These systems are
reviewed and updated on an ongoing basis. Periodic internal audits are
conducted to provide reasonable assurance of compliance with these
systems. The audit committee meets at regular intervals to review the
internal audit function.
4) The annual accounts have been prepared on a going concern basis.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from the public.
AUDITORS
The Auditors, Messrs. M. Raghunath and Company, Chartered Accountants,
Chennai, retire at the conclusion of the ensuing Annual General Meeting
and being eligible offer themselves for reappointment.
The Board on recommendation of the Audit Committee, proposes that
Messrs. M.Raghunath and Company, Chartered Accountants, Chennai, be
appointed as Statutory Auditors of the Company to hold office till the
conclusion of the next Annual General Meeting of the Company. Messrs.
M. Raghunath and Company, Chartered Accountants, Chennai have forwarded
their certificate to the Company stating that their appointment, if
made, will be within the limit specified in that behalf in sub-section
(IB) of Section 224 of the Companies Act, 1956.
CORPORATE GOVERNANCE
A separate section on Corporate Governance is included in the Annual
Report and the Certificate from M/s. R Sridharan & Associates, Company
Secretaries confirming the compliance of conditions on Corporate
Governance as stipulated under Clause 49 of the Listing Agreement of
the Stock Exchange is annexed thereto.
INDUSTRIAL RELATIONS
Generally the Industrial relations with the employees of the Company
continued to be stable, cordial and satisfactory during the financial
year.
PARTICULARS UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956
The information required in terms of Section 217(2A) of the Companies
Act, 1956 read with the Companies (Particulars of Employees) Rules,
1975 is not applicable to this Company, since none of the employees
were in receipt of remuneration higher than the limits fixed in the
said section.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information required under section 217(l)(e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988 is given in the Annexure forming
part of this report.
ACKNOWLEDGEMENT
Your Directors wish to place on record their grateful appreciation of
the valuable assistance and support extended by its buyers, suppliers,
bankers, and corporate and other statutory authorities. Your Directors
also wish to place on record their appreciation for the services
rendered by the employees at all levels, which gives confidence to plan
for greater achievements in the current financial year.
On behalf of the Board
Place: Chennai C.C.Paarthipan M.Jayapal D.P. Mishra
Date : 21st November 2011 CHAIRMAN MANAGING DIRECTOR DIRECTOR
Jun 30, 2010
The Directors have pleasure in presenting the Nineteenth Annual Report
together with the Audited Accounts for the year ended 30lh June 2010.
Financial Performance
(Rupees in lacs)
2009-2010 2008-2009
Sales and Other Income 6246.00 6294.75
Profit before Tax 364.83 320.76
Profit after Tax 333.18 222.57
Key Financial Ratios
Net worth 2543.55 2386.57
Current Ratio 1.64 1.52
Debt Equity 0.41 0.36
Return on Net worth
Earnings per Share
Basic & Diluted 2.21 1.47
OPERATIONS & OUTLOOK
While the growth in Exports was marginal, the Profit before Tax is
higher by about 10% for the year ended 30th June 2010. To fuel growth
in sales in the coming years, several new areas of export and new
product line are being explored. Taking advantage of the market
presence in more than Seven South American countries, this company has
taken several new market initiatives, strengthening of Brand Marketing,
besides expanding market reach to about Eight more South American
countries, which will not only ensure additional revenue for the
company but will also shore up the bottom line as the fixed cost will
be amortized to a larger share of revenue. The current level of
registration of our products work out to almost 100 in each of the
country as on the date of report and several applications are in the
pipeline awaiting clearance at various stages. We are glad to inform
you that subsequent to the close of the year, the company has commenced
its operations in the Unit at Pondicherry, and hope to ramp up in the
next twelve months.
In order for the company to move into more regulated market, the
company has also embarked on an expansion plan by setting up a
formulation unit compliance with the U.S.FDA/ U.K MHRA standards.
Towards this the company has already acquired the land and hired senior
technical professionals. The funding for the project will be from
internal generation and term loans. The project is expected to be on
stream in the next twenty four months.
The Company has also set up an Ointment and tablet facility at Baddi
through a Limited Liability Partnership Firm and is expected to
commence production before this calendar year.
DIVIDEND
The Board of Directors are pleased to recommend a dividend of Re 1/-
per Equity Share of Rs 10 each [10%] for the year ended June 30, 2010
subject to approval of the shareholders in the ensuing Annual General
Meeting. The dividend if approved, at the Annual General Meeting will
be tax free in the hands of the shareholders. The payment of dividend
will entail a cash outflow of Rs176.20 Lacs including dividend
distribution tax of Rs 25.10 Lacs .
TRANSFER OF RESERVES
In terms of Companies (Transfer of Profits to Reserves) Rules, 1975, a
sum of Rs. 33,31,776/- was transferred to General Reserves during the
financial year.
DIRECTORS
Mr. P.T.Baby Thomas, Director, retires by rotation at the ensuing
Annual General Meeting and being eligible, offers himself for
re-appointment.
DIRECTORS RESPONSIBILITY STATEMENT
Your Directors, in accordance with the provisions of Section 217(2AA)
of the Companies Act, 1956, confirm that: 1) Applicable accounting
standards have been followed in the preparation of the Annual Accounts;
2) The Directors have adopted such accounting policies and have applied
them consistently and have made judgements and estimates in a
reasonable and prudent manner so as to give a true and fair view of the
state of affairs of the Company as at the end of the financial year,
and of the profit ^f the Company for the year.
3) Proper and sufficient care has been taken for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
prevention and detection of fraud and other irregularities.
4) The annual accounts have been prepared on a going concern basis.
FIXED DEPOSITS
The Company has not accepted any fixed deposits from the public.
AUDITORS
The Auditors, Messrs. M.Raghunath and Company, Chartered Accountants,
Chennai, retire at the conclusion of the ensuing Annual General Meeting
and being eligible offer themselves for re-appointment.
The Board on recommendation of the Audit Committee, proposes that
Messrs.M.Raghunath and Company, Chartered Accountants, Chennai, be
appointed as Statutory Auditors of the Company to hold office till the
conclusion of the next Annual General Meeting of the Company.
Messrs.M.Raghunath and Company, Chartered Accountants, Chennai have
forwarded their certificate to the company stating that their
appointment, if made, will be within the limit specified in that behalf
in sub-section (1B) of Section 224 of the Companies Act, 1956.
CORPORATE GOVERNANCE
A separate section on Corporate Governance is included in the Annual
Report and the Certificate from M/s. R Sridharan & Associates, Company
Secretaries confirming the compliance of conditions on Corporate
Governance as stipulated under Clause 49 of the Listing Agreement of
the Stock Exchange is annexed thereto.
It is to be informed that our application for Dematerialization of the
shares with NSDL has been accepted.
INDUSTRIAL RELATIONS
Generally the Industrial relations with the employees of the Company
continued to be stable, cordial and satisfactory during the financial
year.
PARTICULARS UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956
The information required in terms of Section 217(2A) of the Companies
Act, 1956 read with the Companies (Particulars of Employees) Rules,
1975 is not applicable to this Company, since none of the employees
were in receipt of remuneration higher than the limits fixed in the
said section.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information required under section 217(1)(e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988 is given in the Annexure forming
part of this report.
ACKNOWLEDGEMENT
Your Directors wish to place on record their grateful appreciation of
the valuable assistance and suppor extended by its buyers, suppliers,
bankers and corporate and other statutory authorities. Your Directors
alsc wish to place on record their appreciation for the services
rendered by the employees at all levels, which gives confidence to plan
for greater achievements in the current financial year.
On behalf of the Board
Place: Chennai M. Jayapal D.P.Mishra
Date : 22nd November 2010 MANAGING DIRECTOR DIRECTOR