Directors Report of J B Chemicals & Pharmaceuticals Ltd.
Mar 31, 2023
Your directors are pleased to present forty-seventh report and audited financial statements of the Company for the financial year ended on March 31, 2023.
The following are the highlights of financial performance of the Company during the year under review.
|
(Rs. in Lakhs) |
||||
|
Standalone |
Consolidated |
|||
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
|
|
Revenue |
285,542.14 |
216,239.43 |
312,091.06 |
239,761.56 |
|
Other Operating revenue |
2,874.27 |
2,748.20 |
2,837.22 |
2,662.82 |
|
Total Operating revenue |
288,416.41 |
218,987.63 |
314,928.28 |
242,424.38 |
|
Other Income |
864.69 |
3,861.38 |
994.01 |
3,922.63 |
|
Total Income |
289,281.10 |
222,849.01 |
315,922.29 |
246,347.01 |
|
Profit before finance cost and depreciation |
67,334.10 |
54,752.35 |
70,569.26 |
58,268.24 |
|
Less: Finance cost |
3,430.93 |
494.87 |
3,605.31 |
512.05 |
|
Less: Depreciation & Amortisation expense |
11,199.28 |
7,128.21 |
11,440.69 |
7,265.99 |
|
Profit before tax |
52,703.89 |
47,129.27 |
55,523.26 |
50,490.20 |
|
Tax Expense (Net) |
13,815.22 |
11,029.06 |
14,522.73 |
11,886.31 |
|
Net Profit after tax |
38,888.67 |
36,100.21 |
41,000.53 |
38,603.89 |
|
Other Comprehensive Income/(Loss) |
(40.24) |
106.59 |
(1,358.04) |
400.60 |
|
Total Comprehensive Income after tax |
38,848.43 |
36,206.80 |
39,642.49 |
39,004.49 |
|
Earnings per share of ''2 (in '') |
||||
|
- Basic |
50.29 |
46.71 |
53.00 |
49.86 |
|
- Diluted |
49.69 |
46.67 |
52.34 |
49.82 |
Your directors recommend a final dividend of '' 9.25 (462.50%) per equity share of face value of '' 2, payment whereof will be subject to deduction of tax at source. During the year, Board of Directors declared interim dividend of '' 8.50 (425%) per equity share, which was paid on March 1, 2023. The final dividend, if declared, together with interim dividend already paid would result in total outgo of '' 13,737 lakhs. The Board has not proposed any transfer out of profit for the financial year to reserves in relation to these dividend payments. The Company paid interim dividend of '' 8.50 (425%) and final dividend of '' 8 (400%) per equity share in the previous year.
3. OPERATIONS/STATE OF AFFAIRS
The Company''s strong performance and sales momentum continued throughout the year, with the Company achieving '' 3,000 crores milestone in terms of revenue. Revenue stood
at '' 314,928 lakhs as compared to '' 242,424 lakhs registering a growth of 30%. The domestic business continued its strong performance growing at 38% driven by organic and inorganic growth while the international business recorded a growth of 22%.
Total standalone revenue during the year at '' 288,416 lakhs was 32% higher over the previous year.
Domestic formulations business revenue was at '' 163,965 lakhs as compared to '' 118,827 lakhs for the previous financial year registering a growth of 38%. The business continued to retain its position as the fastest growing company in Indian Pharmaceuticals Market amongst the top 25. This outperformance is mainly attributed to factors such as - the 5 pillar brands driving market-beating growth, increasing contribution from Chronic Therapies, improved field-force productivity, acceleration in new launches and acquisitions. Consequently, we witnessed further rank improvement in our IPM ranking to 24. As per IQVIA MAT March''23 data, the Company grew at 22% vs market growth of 8%.
Its main brands continued their market-beating performance and remained well above market growth rates. The Company now has 6 brands in the IQVIA top 300 brands list with Azmarda being the new entrant ranking at 261.
The international business revenue (including API) was '' 150,963 lakhs for FY23 vs '' 123,597 lakhs for FY22 recording a growth of 22%. International business delivered a good performance against the odds of challenging and volatile market. The CMO business grew at 60% to record '' 40,578 lakhs of revenue in the financial year. Exports formulation business revenue stood at '' 101,026 lakhs growing at 13% over the previous year with both Russia and South Africa business registering growth. The API sales at '' 9,359 lakhs achieved a growth of ~3% over the previous year.
The cost environment continued to remain challenging but started to stabilised by the second half of the year. Raw materials costs and packing materials costs remained at elevated levels throughout the year. Logistics costs tapered down in the second half of the financial year. High inflationary environment and lower Azmarda margins, impacted the overall gross margins. However, towards the fourth quarter we could see some normalisation of gross margins. Reported EBIDTA was '' 69,575 lakhs (previous year '' 54,346 lakhs). Operating EBIDTA (after adjusting non-cash ESOP costs) was '' 76,513 lakhs (previous year '' 60,611 lakhs).
Profit Before Tax was at '' 55,523 lakhs as compared to '' 50,490 lakhs, growing at 10%. Profit After Tax was at '' 41,001 lakhs as compared to '' 38,604 lakhs. PAT and PBT growth was impacted due to higher finance costs, depreciation and lower treasury income.
During the year, the Company made three acquisitions starting with the acquisition of the brand Azmarda (Sacubitril-Valsartan) which expanded Company''s cardiac portfolio to now include heart failure. Sacubitril-Valsartan is one of the fastest growing molecules in the cardiology segment for the last few years and Azmarda has a sizeable market share in the segment. The second acquisition was the pediatric portfolio which included 4 brands: Z&D, Pecef, Pedicloryl and Ezinapi, all of which complement JB Pharma''s existing pedia portfolio. These brands have helped the Pedia division leverage its Go-to-Market strategy and strengthened its positioning in the overall gut health for children. The latest acquisition was the Rosuvastatin brand Razel and its other combinations. Razel is the 10th largest brand in the Rosuvastatin molecule category (as per IQVIA MAT Oct''22 data). This acquisition ensures JB Pharma''s presence in the largest category of cardiology i.e. statins while further complementing its strong cardiology portfolio.
The Directors confirm:
(i) that in the preparation of the annual accounts for the year under review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of financial year 2022-23 and of profit of the Company for that year;
(iii) that they have 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;
(iv) that they have prepared the annual accounts for the year ended on March 31, 2023 on a going concern basis;
(v) that they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(vi) that they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
The highlights of performance of the subsidiary companies in Rupee terms for the year 2022-23 is presented in Schedule-A. After inter-company adjustments, subsidiary companies contributed '' 26,512 lakhs to consolidated revenue and '' 2,819 lakhs to consolidated profit before tax of the Company.
Revenues for Biotech Laboratories (Pty.) Ltd., South Africa, for the financial year 2022-23 were Rand 647.64 million, which represents growth of 12.31% over the previous year, while its operating profit and profit after tax at Rand 47.54 million and Rand 37.13 million were 22.65% and 30.17% higher over the previous year respectively. Sales of LLC Unique Pharmaceutical Laboratories, Russia, for the financial year 2022-23, at Rouble 794.39 million were 8.14% higher over the previous year, while it incurred net loss of Rouble 2.58 million against profit of Rouble 26.96 million in the previous year. Unique Pharmaceutical Laboratories FZE, Dubai is presently not engaged in any business activity and incurred loss of AED 0.71 million due to operating and other expenses.
7. CORPORATE GOvERNANCE And Compliances
A certificate from practising company secretary on compliance with conditions of corporate governance is annexed to this Board''s report. Management Discussion and Analysis Report, Compliance report on Corporate Governance, Business Responsibility and Sustainability Report and Dividend Distribution Policy form part of this annual report.
8. public deposits
The Company has not accepted any deposit covered under Chapter V of the Companies Act, 2013 during the year. All the public deposits accepted prior to the commencement of the said Act have been repaid in 2014-15.
9. DIRECTORS AND KEY MANAGERIAL PERSONNEL
The members of the Company at annual general meeting held on August 24, 2022 re-appointed Mr. Prashant Kumar, who was retiring by rotation.
In accordance with provisions of the Companies Act, 2013, Mr. Gaurav Trehan would retire by rotation at the ensuing annual general meeting. Being eligible, he has offered himself for re-appointment.
In the opinion of the Board of Directors, Mr. Ranjit Shahani, Mr. Sumit Bose and Ms. Padmini Khare Kaicker, independent directors, are persons of integrity and they all possess relevant expertise and experience necessary for effective functioning of the Company. These independent directors have given declarations to the Board that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 as well as in Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. They have also confirmed that they have registered with the Indian Institute of Corporate Affairs to include their names in the databank of independent directors. However, in terms of Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, these independent directors are not required to pass an online proficiency self-assessment test conducted by the said Institute notified under sub-section (1) of section 150 of the Companies Act, 2013.
Nine meetings of the Board of Directors were held during the financial year ended on March 31, 2023. These meetings were held on April 1, 2022, May 26, 2022, June 29, 2022, July 22, 2022, August 4, 2022, November 11, 2022, December 13, 2022, February 8, 2023 and March 29, 2023.
10. POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION
The Company''s policy on directors'' appointment is set out in Schedule-B. The salient features of the Company''s policy on remuneration for the directors, key managerial personnel and other employees is set out in Schedule-C. The said Policy including criteria for determining qualifications, positive attributes and independence of a director has been posted on the Company''s website www.jbpharma.com.
11. conservation of energy, technology
ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are given in Schedule-D.
12. CORPORATE SOCIAL Responsibility
Corporate Social Responsibility (CSR) Committee of the Board consists of Mr. Ranjit Shahani, Mr. Sumit Bose, Mr. Nikhil Chopra and Mr. Prashant Kumar. The salient features of the CSR Policy of the Company and the annual report on CSR in the prescribed form are set out in Schedule-E. The CSR Policy and annual report on CSR are posted on the Company''s website www.jbpharma.com.
The Company spent '' 819.36 lakhs on CSR activities ('' 779.36 lakhs on CSR activities and '' 40.00 lakhs on administrative overheads for general management and administration of CSR function) during financial year 2022-23 as against obligation of '' 815.10 lakhs being 2% of the average net profits of the Company made during three immediately preceding financial years.
13. AUDIT Committee AND viGILANCE Mechanism
The Board has constituted Audit Committee that consists of Ms. Padmini Khare Kaicker, Chairperson, Mr. Ranjit Shahani, Mr. Sumit Bose and Mr. Prashant Kumar. There has been no instance of non-acceptance of recommendation of Audit Committee by the Board.
The Board of Directors has adopted revised vigil mechanism in the form of Whistle Blower Policy to enable directors, employees and other stakeholders to make Protected Disclosures (as defined in the Policy) in relation to Alleged Wrongful Conduct (as defined in the Policy) to the Redressal Committee for evaluation and investigation in consultation with the Audit Committee. The Company has posted the Whistle Blower Policy and the associated Complaint Response Plan Policy on its website www.jbpharma.com.
14. ANNUAL PERFORMACE EvALUATION
The Board of Directors carried out formal annual evaluation of performance of the Board, its Committees and individual directors during 2022-23 in accordance with the manner specified by the Nomination and Remuneration Committee (NRC) and using evaluation criteria recommended by the NRC and approved by the Board. The performance evaluation was carried out in the following manner, being manner recommended by the NRC.
Evaluation of performance of the Board: Members of the Board evaluated the Board on the given criteria on scale of 1 to 4 (4 being highest). The aggregate of simple average of rating assigned by each Board member was further averaged to ascertain Board''s performance.
Evaluation of performance of the Board Committees: Members of the concerned committee evaluated performance of the committee on the given criteria on scale of 1 to 4. Aggregate of simple average of rating assigned by members was further averaged to ascertain performance of the concerned committee.
Evaluation of performance of Individual Director: Board members (excluding director being evaluated) evaluated performance of all other Board members on the given criteria on scale of 1 to 4. Aggregate of simple average of rating assigned to each Board member was further averaged to ascertain performance of such director.
15. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Form AOC-2 prescribed under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014 provides for disclosure of (a) details of contracts or arrangements or transactions not at arm''s length basis, and (b) details of material contracts or arrangement or transactions at arm''s length basis.
All the transactions entered into by the Company with the related parties during the year were pursuant to the contract or arrangement approved by the Audit Committee and the Board of Directors. The transactions so entered into were in the ordinary course of business of the Company and on arm''s length basis. The contract or arrangement or transactions were neither material in terms of the Policy on materiality of related party transactions adopted by the Company nor it exceeded the threshold limit prescribed pursuant to first proviso to Section 188(1) of the Companies Act, 2013. Accordingly, the disclosure of related party transactions in Form AOC-2 is not applicable. However, disclosure on related party transactions as per IND AS-24 has been provided under Note No. 45 of the standalone financial statements and Note No. 43 of the consolidated financial statements.
16. PARTICULARS OF EMPLOYEES AND OTHER REMUNERATION Related DISdOSURES
The remuneration related and other disclosure required in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, are given in Schedule-F.
A statement showing name and other particulars of the employees in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is given in Schedule-G.
17. employee stock option scheme
"JBCPL Employee Stock Option Scheme 2021â ("Scheme") was approved by the shareholders on July 31,2021. The Compensation Committee of the Board administers the Scheme and granted time based options and performance based options to eligible employees and director(s) of the Company and its subsidiary companies with a view to achieve overall growth objective. The Scheme is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (under the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021) and there has been no change in the Scheme since the shareholders'' approval date.
Disclosure of details of the Scheme as required under (a) Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are posted on the Company''s website www.jbpharma.com and web link thereto is https://jbpharma.
com/download/esop-disclosure-for-the-year-ended-31-03-2023/?wpdmdl=7953&refresh=6493e84a349c41687414858 and (b) the Companies (Share Capital and Debentures) Rules, 2014, is set out in Schedule-H to this report.
The Board of Directors has developed and implemented risk management policy for the Company. Pursuant to the Listing Regulations, the Board has constituted Risk Management Committee and delegated monitoring and review of the risk management plan to the Committee. Committee periodically reviews the status of mitigation measures taken in respect of risk management plan and reports the progress thereof and new risks identified to the Board and Audit Committee. Board at present does not perceive any element of risk, which may threaten existence of the Company.
19. INTERNAL FINANCIAL CONTROLS
The Board has adopted internal financial controls encompassing policies and procedures for ensuring orderly and efficient conduct of business, including adherence to Company''s policies, safeguarding the Company''s assets, prevention and detection of fraud and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. The specific internal financial controls with reference to financial statements include internal audit of important activities and processes relating to preparation of financial statements, adoption of well-defined standard operating procedure for business transactions and compliance relating thereto, use of ERP for accuracy and control, review of periodically prepared financial statements with an objective to ensure that financial statements present true and fair view and are sufficient/credible and in compliance with legal and regulatory requirements. The Board has appointed Ernst & Young LLP as internal auditor to periodically audit systems and controls in all key areas of operations to ascertain effective functioning of internal controls including internal financial controls. In the opinion of the Board, the Company has adequate internal controls with reference to the financial statements.
Neither management of the Company has come across any instance of fraud during the year 2022-23 nor the auditors of the Company have reported any such instance to the Audit Committee.
20. LOANS, GUARANTEES AND INvESTMENTS
During the year, the Company has not given any loan or made any investment attracting the provisions of Section 186 of the Companies Act, 2013. The particulars of guarantees given pursuant to Section 134(3)(g) of the Companies Act, 2013 during the year and outstanding as at the year-end are given in Annexure-I.
The Company is required to maintain cost records as specified by the Central Government under sub-section (1) of Section 148
of the Companies Act, 2013, and such accounts and records are duly made and maintained by the Company. The Company is further required to get such cost records audited by a cost auditor in accordance with the Companies (Cost Records and Audit) Rules, 2014 and furnish cost audit report received from the cost auditor to the Central Government within the prescribed time. The Company is in compliance with these provisions.
Ashish Bhatt & Associates, Practising Company Secretaries, Secretarial Auditor of the Company, carried out secretarial audit for the financial year 2022-23 as provided under Section 204 of the Companies Act, 2013 and rules made there under. The secretarial audit report given by the said auditor is annexed to this report as Schedule-J.
The members at annual general meeting held on September 9, 2021 has appointed Deloitte Haskins & Sells LLP, (having firm registration no. 117366W/W-100018) as statutory auditors of the Company until conclusion of the 49th annual general meeting of the Company at such remuneration as may be agreed by the Board of Directors with the auditors.
24. ESG (ENVIRONMENT, SOCIAL & GOVERNANCE)
We stand firmly by our commitment towards instituting a sustainable business strategy to positively impact the environment and society while also catering to our shareholders.
Our Company''s growth is not limited to economic performance but also our environmental and social performance.
Our philosophy is to conduct business in a socially, environmentally, and ethically responsible manner with a defined approach towards environmental protection, natural resource conservation, and cost efficiency in order to ensure the safety & health protection of our employees, communities, and the planet at large.
This year we published our maiden Sustainability report which is a testament to our unwavering commitment to creating a positive impact across various facets of Environment, Social, and Governance (ESG). This report has been prepared in accordance with the GRI Standards: Core option United Nations Sustainable Development Goals (UN SDGs).
In this endeavour, we conducted a comprehensive analysis to understand areas which can be improved to propel our sustainability agenda forward. It entailed enhancing our processes, systems, and policies that nurture an equitable, environmentally conscious, and gender sensitive culture. We also conducted an extensive stakeholder engagement exercise this year to take into consideration their perspective which helped us to gauge their ESG expectations as well as identify the key priority areas for the business to focus on.
The materiality assessment, based on the engagement, formed the foundation of our maiden Sustainability Report.
As we move forward, the Company remains committed towards reducing the environmental burden, generating more clean energy and decreasing CO2 emissions in absolute or as a percentage of units produced and continue its efforts towards social transformation as we address patients'' needs with utmost importance and ensure accessibility and affordability of healthcare for all.
25. OTHER DISdOSURES AND Confirmations
Board has to make further disclosures and provide confirmations, as required, as under:
⢠The Company has placed annual return referred to in subsection (3) of section 92 on its website www.jbpharma.com.
⢠No regulator or court or tribunal has passed, during the year, any significant or material order affecting the going concern status and Company''s operations in future.
⢠The Company has complied with applicable Secretarial Standards specified by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.
⢠The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Company continues to accord high priority to health and safety of employees and workmen at all manufacturing locations. Annual medical check-up of all employees at all sites was carried out. The Company also conducted safety training programmes and mock-drills for increasing disaster preparedness and creating awareness among all employees at the plants. There was no casualty at any site during the year.
For and on behalf of the Board of Directors
Ranjit Shahani Chairman
Place : Mumbai
Date : May 24, 2023
Mar 31, 2022
Your directors are pleased to present forty-sixth report and audited financial statement of the Company for the financial year ended on March 31, 2022.
The following are the highlights of financial performance of the Company during the year under review.
|
('' in lakhs) |
||||
|
Standalone |
Consolidated |
|||
|
2021-22 |
2020-21 |
2021-22 |
2020-21 |
|
|
Sales |
216,239.43 |
184,907.75 |
239,761.56 |
200,211.39 |
|
Other Operating revenue |
2,748.20 |
4,291.80 |
2,662.83 |
4,040.76 |
|
Other Income |
3,861.38 |
11,188.94 |
3,922.63 |
11,238.32 |
|
Total Income |
222,849.01 |
200,388.49 |
246,347.01 |
215,490.47 |
|
Profit before finance cost and depreciation |
54,752.34 |
66,825.48 |
58,268.24 |
67,279.21 |
|
Less: Finance cost |
494.87 |
719.18 |
512.05 |
724.12 |
|
Less: Depreciation & Amortisation expense |
7,128.21 |
6,735.50 |
7,265.99 |
6,866.55 |
|
Profit before tax |
47,129.26 |
59,370.80 |
50,490.20 |
59,688.54 |
|
Tax Expense (Net) |
11,029.06 |
14,662.32 |
11,886.31 |
14,836.24 |
|
Net Profit after tax |
36,100.20 |
44,708.48 |
38,603.89 |
44,852.30 |
|
Other Comprehensive Income |
106.60 |
(1,249.67) |
400.60 |
33.46 |
|
Total Comprehensive Income after tax |
36,206.80 |
43,458.81 |
39,004.49 |
44,885.76 |
|
Earnings per share of '' 2 (in '') |
||||
|
- Basic |
46.71 |
57.85 |
49.86 |
57.96 |
|
- Diluted |
46.67 |
57.85 |
49.82 |
57.96 |
Your directors recommend a final dividend of '' 8 (400%) per equity share of face value of '' 2, payment whereof will be subject to deduction of tax at source. During the year, Board of directors declared interim dividend of '' 8.50 (425%) per equity share, which was paid on March 4, 2022. The final dividend, if declared, together with interim dividend already paid would result in total outgo of '' 127.52 crores. The Board has not proposed any transfer out of profit for the financial year to reserves in relation to these dividend payments. The Company paid interim dividend of '' 8.50 (425%) and final dividend of '' 8 (400%) per equity share in the previous year.
3. OPERATIONS/STATE OF AFFAIRS
The Company''s strong performance and sales momentum continued throughout the year, with several businesses outperforming. Revenue for the organisation was at '' 2,424 crores as compared to '' 2,043 crores recording growth of
19 %. The domestic business continued its outperformance while the international business bounced back strongly in the fourth quarter to record double digit growth for the financial year.
Total standalone sales during the year at '' 2,189.88 crores were 15.7% higher over the previous year.
Domestic formulations business revenue was at '' 1,173 crores as compared to '' 892 crores for the previous financial year registering growth of 32%. Domestic business continued to maintain its stellar performance. The business continued to retain its position as the fastest growing company in IPM amongst top 30. This outperformance is mainly attributed to factors such as - the 5 pillar brands driving market-beating growth, increasing contribution from Chronic Therapies, improved field-force productivity, acceleration in new launches. Going forward, we will continue to capitalize on synergies from the acquired brands. Consequently, we have seen a significant improvement in our IPM ranking over the past 12 months - from 32 to 25. As per IQVIA MAT Mar''22 data, the Company grew
at 29% vs market growth of 18%. Its main brands continue their market-beating performance and remain well above market growth rates. During the year, the business introduced fifteen new products. Further, the integration of the newly acquired brands from Sanzyme is on track towards stability and maximization of synergistic growth.
The international business revenue was at '' 1,236 crores for FY 22 as compared to '' 1,127 crores recording growth of 10%. International business delivered a good performance against the odds of a challenging and volatile market. This strong bounce-back especially in the fourth quarter was made possible by surging demand in Contract Manufacturing & Lozenge business, and revived demand in several pockets of ROW business. Exports formulation business revenue was at '' 892 crores growing at 10% over the previous year. CMO business aided by new launches and new customers performed well with revenue at '' 253 crores, registering a growth of 12% over the previous year. The API sales at '' 91 crores achieved growth of 1% over the previous year.
The business saw a challenging cost environment during the year especially in the second half of the year. Inflation in material costs, power & fuel and shipping costs accentuated alongwith the normalisation of operating costs. These could be partly mitigated through cost savings initiative, pricing & business mix. Reported EBIDTA was '' 655 crores (previous year '' 560 crores). Adjusted EBIDTA (after adjusting non-cash ESOP & one-time costs) was '' 543 crores (previous year '' 560 crores).
Profit Before Tax was at '' 505 crores as compared to '' 597 crores. Profit After Tax was at '' 386 crores as compared to '' 449 crores. PAT and PBT was impacted due to the non-cash ESOP charge and one time related non-recurring charges in this financial year and higher other income recorded in the previous year.
During the year, the Company acquired portfolio of brands from Sanzyme Private Limited, which has marked the Company''s entry into the fast-growing probiotics, therapeutic nutraceuticals and reproductive health market in the country.
Subsequent to the year end, the Company acquired the brand Azmarda® indicated for heart failure patients with reduced ejection fraction (HFrEF) from Novartis AG, Switzerland for India. The said brand shall help the Company in strengthening its presence in the Cardiology segment in the country.
The directors confirm:
(i) that in the preparation of the annual accounts for the year under review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of financial year 2021-22 and of profit of the Company for that year;
(iii) that they have 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;
(iv) that they have prepared the annual accounts for the year ended on March 31, 2022 on a going concern basis;
(v) that they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(vi) that they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
The highlights of performance of subsidiary companies in Rupee terms for the year 2021-22 is presented in Schedule-A. After inter-company adjustments, subsidiary companies contributed '' 234.37 crores to consolidated income and '' 33.60 crores to consolidated profit before tax of the Company.
Sales of Biotech Laboratories (Pty.) Ltd., South Africa, for the financial year 2021 -22 were Rand 576.66 million, which represents growth of 20.84% over the previous year, while its operating profit and profit after tax at Rand 38.77 million and Rand 28.53 million were 12.12% and 11.14% higher over the previous year respectively. Sales of LLC Unique Pharmaceutical Laboratories, Russia, for the financial year 2021-22, at Rouble 734.56 million were 12.39% higher over the previous year, while it earned net profit of Rouble 26.96 million against loss of Rouble 1.45 million in the previous year. Unique Pharmaceutical Laboratories FZE, Dubai is presently not engaged in any business activity. It has incurred loss of AED 0.78 million due to operating and other expenses.
7. CORPORATE GOVERNANCE AND COMPLIANCES
A certificate from practising company secretary on compliance with conditions of corporate governance is annexed to this Board''s report. Management Discussion and Analysis Report, Compliance report on Corporate Governance, Business Responsibility Report and Dividend Distribution Policy form part of this annual report.
The Company has not accepted any deposit covered under Chapter V of the Companies Act, 2013 during the year. All the public deposits accepted prior to the commencement of the said Act have been repaid in 2014-15.
9. DIRECTORS AND KEY MANAGERIAL PERSONNEL
The members of the Company at annual general meeting held on September 9, 2021 appointed Mr. Gaurav Trehan as Non-executive director liable to retire by rotation and re-appointed Ms. Ananya Tripathi, who was retiring by rotation.
Mr. Sanjay Nayar and Ms. Ananya Tripathi, resigned from the Board of directors with effect from January 25, 2022 and March 11,2022 respectively.
In accordance with provisions of the Companies Act, 2013, Mr. Prashant Kumar would retire by rotation at the ensuing annual general meeting. Being eligible, he has offered himself for re-appointment.
In the opinion of the Board of directors, Mr. Ranjit Shahani, Mr. Sumit Bose and Ms. Padmini Khare Kaicker, independent directors, are persons of integrity and they all possess relevant expertise and experience necessary for effective functioning of the Company. These independent directors have given declarations to the Board that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 as well as in Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. They have also confirmed that they have registered with the Indian Institute of Corporate Affairs to include their names in the databank of independent directors. However, in terms of Companies (Appointment and Qualification of Directors) Rules, 2014 as amended, these independent directors are not required to pass an online proficiency self-assessment test conducted by the said Institute notified under sub-section (1) of section 150 of the Companies Act, 2013.
Ten meetings of the Board of directors were held during the financial year ended on March 31, 2022. These meetings were held on April 1, 2021, April 28, 2021, June 14, 2021, July 14, 2021, August 12, 2021, October 1, 2021, November 11, 2021, January 25, 2022, February 14, 2022 and March 22, 2022.
Mr. Vijay Bhatt resigned as Chief Financial Officer with effect from August 31, 2021 and Mr. Lakshay Kataria was appointed as Chief Financial Officer of the Company with effect from October 4, 2021. Mr. Mayur Mehta resigned as Complany Secretary with effect from July 14, 2021 and Mr. Sandeep Phadnis was appointed as Company Secretary and compliance officer with effect from July 15, 2021.
10. POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION
The Company''s policy on directors'' appointment is set out in Schedule-B. The salient features of the Company''s policy on remuneration for the directors, key managerial personnel and other employees is set out in Schedule-C. The said Policy including criteria for determining qualifications, positive attributes and independence of a director has been posted on the Company''s website wwwjbpharma.com.
11. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are given in Schedule-D.
12. CORPORATE SOCIAL RESPONSIBILITY
Corporate Social Responsibility (CSR) Committee of the Board consists of Mr. Ranjit Shahani, Mr. Sumit Bose, Mr. Nikhil Chopra and Mr. Prashant Kumar. The CSR Committee formulated and recommended revised CSR Policy to the Board, which the Board approved on February 10, 2021. The salient features of the said CSR Policy of the Company and the annual report on CSR in the prescribed form are set out in Schedule-E. The CSR Policy and annual report on CSR are posted on the Company''s website www.jbpharma.com.
The Company spent '' 6.95 crores on CSR activities ('' 6.61 crores on CSR activities and '' 0.34 crore on administrative overheads for general management and administration of CSR function) on prescribed CSR activities during financial year 2021-22 as against obligation of '' 6.94 crores being 2% of the average net profits of the Company made during three immediately preceding financial years.
13. AUDIT COMMITTEE AND VIGILANCE MECHANISM
The Board has constituted Audit Committee that consists of Ms. Padmini Khare Kaicker, Chairperson, Mr. Ranjit Shahani, Mr. Sumit Bose and Mr. Prashant Kumar. There has been no instance of non-acceptance of recommendation of Audit Committee by the Board.
The Board of directors has on November 10, 2020, adopted revised vigil mechanism in the form of Whistle Blower Policy to enable directors, employees and other stakeholders to make Protected Disclosures (as defined in the Policy) in relation to Alleged Wrongful Conduct (as defined in the Policy) to the Redressal Committee for evaluation and investigation in consultation with the Audit Committee. The Policy empowers the Redressal Committee to initiate inquiry and investigation if the issue raised constitutes bona fide Protected Disclosure made in good faith. The Redressal Committee is required to complete the investigation in a time bound manner. Where it concludes that Unethical and/or Improper Activity (as defined in the Policy) has been committed, it shall recommend, after consultation with the Audit Committee, to the management of the Company to take such disciplinary or corrective action as it or the Audit Committee deems fit. The Policy provides for access of whistle blower to the Chairman of the Audit Committee in appropriate or exceptional circumstances. The Policy provides for adequate safeguards of whistle blowers against any kind of victimisation or unfair treatment but also provides for taking stern disciplinary action against who abuses the protection so granted. This functioning of vigil mechanism will be periodically reviewed by the Audit Committee. The Company has posted the Whistle Blower Policy and the associated Complaint Response Plan Policy on its website www.jbpharma.com.
14. ANNUAL PERFORMACE EVALUATION
The Board of directors carried out formal annual evaluation of performance of the Board, its Committees and individual directors during 2021-22 in accordance with the manner specified by the Nomination and Remuneration Committee (NRC) and using evaluation criteria recommended by the NRC and approved by the Board. The performance evaluation was carried out in the following manner, being manner recommended by the NRC.
Evaluation of performance of the Board: Each member of the Board evaluated the Board on the given criteria on scale of 1 to 4 (4 being highest). The aggregate of simple average of rating assigned by each Board member was further averaged to ascertain Board''s performance.
Evaluation of performance of the Board Committees: Each member of the concerned committee evaluated performance of the committee on the given criteria on scale of 1 to 4. Aggregate of simple average of rating assigned by each such member was further averaged to ascertain performance of the concerned committee.
Evaluation of performance of Individual Director: Each Board member (excluding director being evaluated) evaluated performance of all other Board members on the given criteria on scale of 1 to 4. Aggregate of simple average of rating assigned to each Board member was further averaged to ascertain performance of such director.
15. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Form AOC-2 prescribed under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014 provides for disclosure of (a) details of contracts or arrangements or transactions not at arm''s length basis, and (b) details of material contracts or arrangement or transactions at arm''s length basis.
All the transactions entered into by the Company with the related parties during the year were pursuant to the contract or arrangement approved by the Audit Committee and the Board of directors. The transactions so entered into were in the ordinary course of business of the Company and on arm''s length basis. The contract or arrangement or transactions were neither material in terms of the Policy on materiality of related party transactions adopted by the Company nor it exceeded the threshold limit prescribed pursuant to first proviso to Section 188(1) of the Companies Act, 2013. Accordingly, the disclosure of related party transactions in Form AOC-2 is not applicable. However, disclosure on related party transactions as per IND AS-24 has been provided under Note No. 46 of the standalone financial statements and Note No. 44 of the consolidated financial statements.
16. PARTICULARS OF EMPLOYEES AND OTHER REMUNERATION RELATED DISCLOSURES
The remuneration related and other disclosure required in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, are given in Schedule-F.
A statement showing name and other particulars of the employees in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is given in Schedule-G.
17. EMPLOYEE STOCK OPTION SCHEME
During the year, the Company implemented "JBCPL Employee Stock Option Scheme 2021â ("Scheme") as approved by the shareholders on July 31, 2021 and has also received in-principle listing approval from the Stock Exchanges in respect thereof. The Compensation Committee of the Board administers the Scheme and granted time based options and performance based options to eligible employees and director(s) of the Company and its subsidiary companies with a view to achieve overall growth objective. The Scheme is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (saved under the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021) and there has been no change in the Scheme since the shareholders'' approval date.
Disclosure of details of the Scheme as required under (a) Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are posted on the Company''s website www.jbpharma.com and web link thereto is https://jbpharma.com/download/esop-disclosure-for-the-year-ended-31-03-2022/?wpdmdl=6061&refresh=62cbdc37cecb81657527351 and (b) the Companies (Share Capital and Debentures) Rules, 2014, is set out in Schedule-H to this report.
The Board of directors has developed and implemented risk management policy for the Company. Pursuant to the Listing Regulations, the Board has constituted Risk Management Committee and delegated monitoring and review of the risk management plan to the Committee. Committee would periodically review status of mitigation measures taken in respect of risk management plan and would report progress thereof and new risks identified to the Board and Audit Committee. Board at present does not perceive any element of risk, which may threaten existence of the Company.
19. INTERNAL FINANCIAL CONTROLS
The Board has adopted internal financial controls encompassing policies and procedures for ensuring the orderly and efficient conduct of the business, including adherence to Company''s policies, safeguarding the Company''s assets, prevention and detection of fraud and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. The specific internal financial controls with reference to financial statements include internal audit of important activities and processes relating to preparation of financial statements, adoption of well-defined standard operating procedure for business transactions and compliance relating thereto, use of ERP for accuracy and control, review of periodically prepared financial statements with objective to ensure that financial statements present true and fair view and are sufficient/credible and in compliance with legal and regulatory requirement. The Board has appointed Ernst & Young LLP as internal auditor to periodically audit systems and controls in all key areas of operations to ascertain effective functioning of internal controls including internal financial controls. In the opinion of the Board, the Company has adequate internal controls with reference to the financial statements.
Neither management of the Company has come across any instance of fraud during the year 2021-22 nor the auditors of the Company has reported any such instance to the Audit Committee.
20. LOANS, GUARANTEES AND INVESTMENTS
During the year, the Company has not given any loan or guarantee or made any investment attracting the provisions of Section 186 of the Companies Act, 2013. Hence, there is no information to be furnished pursuant to Section 134(3)(g) of the Companies Act, 2013.
The Company is required to maintain cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, and such accounts and records are duly made and maintained by the Company. The Company is further required to get such cost records audited by a cost auditor in accordance with the Companies (Cost Records and Audit) Rules, 2014 and furnish cost audit report received from the cost auditor to the Central Government within the prescribed time. The Company is in compliance with these provisions.
Ashish Bhatt & Associates, Practising Company Secretaries, Secretarial Auditor of the Company, carried out secretarial audit for the financial year 2021-22 as provided under Section 204 of the Companies Act, 2013 and the rules made there under. The secretarial audit report given by the said auditor is annexed to this report as Schedule-I.
The members at annual general meeting held on September 9, 2021 has appointed Deloitte Haskins & Sells LLP, (having firm registration no. 117366W/W-100018) as statutory auditors of the Company until conclusion of the 49th annual general meeting of the Company at such remuneration as may be agreed by the Board of directors with the auditors.
24. ESG (ENVIRONMENT, SOCIAL & GOVERNANCE)
We continue to embrace the triple bottom-line philosophy of People, Planet and Profits. During the year under review, we reaffirmed our commitment to ESG(Environment, Social and Governance) and have instituted a sustainable business strategy to positively impact the environment and society while also benefiting shareholders. ESG in today''s context is not just about goodwill and reputation but it can be used as a competitive edge at the marketplace. While as an organisation we have focused on all these areas in different aspects, we are committed to dedicating further resources and efforts towards this area. During the year under review, we undertook a detailed gap assessment analysis regarding our ESG parameters. Our gap assessment was based on benchmarks established by GRI ( Global Reporting Initiative) and the local ESG standards set by reputed institutions. As you are aware, GRI is the benchmark standard for most
Fortune - 500 companies when reporting on ESG parameters. We have instituted various policies to strengthen the governance mechanism including ABAC, POSH etc. We have also ensured that our employees are trained on various governance mechanisms so that these policies are embraced by every employee in the organisation. We have introduced a framework that will help us monitor, measure and improve our environmental footprint; like water usage, waste and effluent generated, use of renewable energy sources, implementation of zero discharge norms across sites and instituting a strong HSE policy. We have instituted a sustainable business strategy which encompasses shortterm and medium-term goals for the organisation. Our efforts will continue to focus on increasing ESG standards within the organisation. We also plan to publish a sustainability report based on GRI standards. All these initiatives and efforts will ensure that we continue raise the bar every year regarding ESG standards.
25. OTHER DISCLOSURES AND CONFIRMATIONS
Board has to make further disclosures and provide confirmations, as required, as under:
⢠The Company has placed annual return referred to in subsection (3) of section 92 on its website www.jbpharma.com.
⢠No regulator or court or tribunal has passed, during the year, any significant or material order affecting the going concern status and Company''s operations in future.
⢠The Company has complied with applicable Secretarial Standards specified by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.
⢠The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Company continues to accord high priority to health and safety of employees and workmen at all manufacturing locations. Annual medical check-up of all employees at all sites was carried out. The Company also conducted safety training programmes and mock-drills for increasing disaster preparedness awareness among all employees at the plants. There was no casualty at any site during the year.
For and on behalf of the Board of Directors
Ranjit Shahani Chairman
Place : Mumbai Date : May 26, 2022
Mar 31, 2018
The directors are pleased to present the forty-second report and audited financial statement of the Company for the financial year ended on March 31, 2018.
1. FINANCIAL HIGHLIGHTS
The following is the highlight of financial performance of the Company during the year under review:
(Rs. in lakhs)
|
2017-18 |
2016-17 |
|
|
Revenue from Operations |
125,473.42 |
119,869.42 |
|
Other Income |
3,525.53 |
4,589.03 |
|
Total Income |
128,998.95 |
124,458.45 |
|
Profit before finance cost and depreciation |
23,840.51 |
26,804.91 |
|
Less: Finance cost |
341.36 |
500.13 |
|
Less: Depreciation & Amortisation expense |
5,594.85 |
4,626.42 |
|
Profit before tax |
17,904.30 |
21,678.36 |
|
Tax Expense |
5,104.16 |
4,381.90 |
|
Net Profit after tax |
12,800.14 |
17,296.46 |
|
Other Comprehensive Income |
(241.63) |
(270.43) |
|
Total Comprehensive Income after tax |
12,558.51 |
17,026.03 |
|
Earning per share of Rs.2 (in Rs.) |
15.24 |
20.39 |
2. DIVIDEND
Your directors recommend a dividend of Rs.2 (100%) (Previous year Re.1) (50%) per equity share of face value of Rs.2. This together with dividend distribution tax will absorb Rs.2,014.96 lakhs. The Board has not proposed any transfer out of profit for the financial year to reserves in relation to recommendation of this dividend.
3. BUY-BACK OF EQUITY SHARES
The Company completed on 25-7-2017 buy-back of 1,250,000 equity shares of face of Rs.2 at price of Rs.400 per share on proportionate basis through tender offer in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998. Consequently, the paid-up equity share capital stands reduced to 83,569,975 equity shares of Rs.2. The Company has transferred the sum of Rs.25 lakhs from general reserves to capital redemption reserve account pursuant to Section 69 of the Companies Act, 2013.
4. OPERATIONS/STATE OF AFFAIRS
Total net sales for the year at Rs.1,227.80 crores were 5.17% higher over net sales for the previous financial year.
Domestic formulations business at sales of Rs.543.60 crores achieved growth of 9.63%, while Contrast media products sales in domestic market at Rs.44.54 crores achieved marginal growth. The Company has made sizeable addition to the field force for domestic formulations business to meet requirement of the market and product portfolio. This initiative has begun showing positive results. Overall formulations exports at Rs.537.88 crores grew by 2.65% over previous year. The exports to Rest of the World markets (other than Russia-CIS) at Rs.398.13 crores registered growth of 5.28% but the same were impacted by pricing pressure and adverse currency movements in many markets. The Company continues to invest in key market of US for future growth. Exports to Russia-CIS markets at Rs.60.53 crores were marginally lower compared to the previous year, while API business at sales of Rs.92.76 crores registered marginal growth. The Company has been making investments to expand product portfolio for the Russian market.
The profit before tax and profit after tax for the year at Rs.179.04 crores and Rs.128 crores was 17.41% and 26% lower respectively compared to the previous year. The profit for the year was impacted due to expansion of field force for domestic market and certain non-recurring operating expenditure amounting to Rs.14.56 crores, in addition to higher depreciation and strong Rupee during the year.
5. RESPONSIBILITY STATEMENT
The directors confirm:
(i) that in the preparation of the annual accounts for the year under review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of financial year 2017-18 and of profit of the Company for that year;
(iii) that they have 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;
(iv) that they have prepared the annual accounts for the year ended on March 31, 2018 on a going concern basis;
(v) that they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(vi) that they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
6. SUBSIDIARIES
The highlights of performance of subsidiary companies for the year 2017-18 is presented in Annexure-A.
The sales of Biotech Laboratories (Pty.) Ltd. (âBiotechâ) for 2017-18 were 12.56 % lower compared to the previous year due to certain sales in tender business not materialising, however, Biotech was able to achieve moderate growth of 9.45% in profit before tax. OOO Unique Pharmaceutical Laboratories (âOOO UPLâ) reported moderate growth of 4.66% in sales for the year, while profit before tax of Rs.1.32 crores was also higher. Unique Pharmaceutical Laboratories FZE (âUPL FZEâ) was master distributor of Companyâs products in Russia-CIS market up to 31-12-2017, and in the course of such business, UPL FZE sold goods of the Company to OOO UPL and customers in CIS. Sales of UPL FZE to OOO UPL during period up to 31-12-2017 amounted to Rs.36.95 crores. Effective 1-1-2018, UPL FZE has discontinued marketing and sales activities in Russia-CIS and consequently, the Company has resumed the said role. The Companyâs sales to OOO UPL during last quarter were Rs.9.16 crores. After inter-company adjustments, subsidiaries contributed Rs.158.17 crores to consolidated sales and Rs.14.90 crores to consolidated profit before tax of the Company. The above performance and growth numbers are based on conversion of respective currency into Indian Rupees.
7. CORPORATE GOVERNANCE AND COMPLIANCES
A certificate from auditors of the Company on compliance of conditions of corporate governance and management discussion and analysis report are annexed to this report. Compliance report on corporate governance, business responsibility report and dividend distribution policy forms part of this annual report. The Company has complied with applicable Secretarial Standards specified by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.
8. PUBLIC DEPOSITS
The Company has not accepted any deposit covered under Chapter V of the Companies Act, 2013 during the year. All the public deposits accepted prior to the commencement of the said Act have been repaid in 2014-15.
9. DIRECTORS
The members of the Company appointed Dr. Manoj R. Mashru as independent director at annual general meeting held on 19-9-2017. In accordance with the provisions of the Companies Act, 2013, Mr. Shirish B. Mody retires by rotation at the ensuing annual general meeting. He, being eligible, has offered himself for re-appointment.
All independent directors have given a declaration to the Board that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 as well as in Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
At annual general meeting held on 15-9-2014, the members of the Company appointed Mr. Durga Dass Chopra, Dr. Satyanarain Agarwala, Mr. Rajiv C. Mody and Ms. Krupa R. Gandhi as independent directors for a term up to five (5) years that commenced from April 1, 2014. Thus, they hold office up to 31-3-2019. The performance evaluation ranking is high of the said independent directors and accordingly the Board is of the opinion that continued association of these independent directors for a second term of five (5) years would be in interest of the Company. Keeping in view performance evaluation reports of these independent directors for the first term, the Board of Directors proposes re-appointment of Mr. Durga Dass Chopra, Dr. Satyanarain Agarwala, Mr. Rajiv C. Mody and Ms. Krupa R. Gandhi for a second term up to five (5) years commencing from April 1, 2019.
Total 4 meetings of the Board of Directors of the Company were held during the financial year 2017-18. They were held on May 23, 2017, August 11, 2017, November 10, 2017 and February 9, 2018.
10. POLICY ON DIRECTORSâ APPOINTMENT AND REMUNERATION POLICY
The Companyâs policy on directorsâ appointment is set out in Annexure-B. The salient features of Companyâs policy on remuneration for the directors, key managerial personnel and other employees is set out in Annexure-C. The said Policy including criteria for determining qualifications, positive attributes and independence of a director has been posted on the Companyâs website www.jbcpl.com and the same can be accessed using web link http://www.jbcpl.cominvestors/pdf/ policy/remuneration%20policy.pdf.
11. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are given in Annexure-D.
12. CORPORATE SOCIAL RESPONSIBILITY
Pursuant to the requirement of Section 135 of the Companies Act, 2013, the Board of the Company has constituted Corporate Social Responsibility (CSR) Committee comprising of Dr. Satyanarain Agarwala, independent director, Mr. Bharat P. Mehta and Mr. Pranabh Mody. The CSR Committee has formulated and recommended CSR Policy to the Board, which the Board has approved. The details and contents/salient features of CSR policy and annual report on CSR in the prescribed form are set out in Annexure-E.
The Company spent Rs.295.41 lakhs on prescribed CSR projects/activities during 2017-18 as against Rs.391.86 lakhs being 2% of the average net profits of the Company made during three immediately preceding financial years. Pursuant to second proviso to Section 135(5) of the Companies Act, 2013, Board has to specify that the Company could not spend Rs.96.45 lakhs as it did not come across other deserving activity/projects in the focus area of CSR activities/projects as per CSR Policy for overall benefit of needy section of the society. CSR Committee regularly monitors implementation of the CSR Policy and looks out for activities/projects in consonance with focus area of CSR Policy.
13. AUDIT COMMITTEE AND VIGILANCE MECHANISM
The Board has constituted Audit Committee comprising of Mr. Durga Dass Chopra, Dr. Satyanarain Agarwala, Mr. Dinesh B. Mody and Ms. Krupa R. Gandhi. There has been no instance of non-acceptance of recommendation of Audit Committee by the Board.
The Board of Directors has established vigil mechanism in the form of Whistle Blower Policy to enable directors, employees and other stakeholders to make written Protected disclosures (as defined in the Policy) to the Chairman of the Redressal Committee for evaluation and investigation. The Policy empowers the Redressal Committee to investigate if the issue raised constitutes protected disclosure, complete the investigation in a time bound manner and recommend, after consultation with the Audit Committee, necessary corrective action to the concerned manager for implementation. The Policy provides for access of whistle blower to the Chairman of the Audit Committee in appropriate or exceptional circumstances. The Policy provides for adequate safeguards of whistle blowers against any kind of victimisation or unfair treatment but also provides for taking stern disciplinary action against who abuses the protection so granted. This functioning of vigil mechanism is periodically reviewed by the Audit Committee. The Company has posted the Whistle Blower Policy on its website www.jbcpl.com.
14. ANNUAL PERFORMACE EVALUATION
The Board of Directors carried out evaluation of performance of the Board, its Committees and individual directors during 2017-18 in accordance with the manner specified by the Nomination and Remuneration Committee (NRC) and using evaluation criteria recommended by NRC and approved by the Board.
Each Board member (excluding director being evaluated) evaluated performance of all other Board members on the given criteria, then simple average of rating assigned to performance of one director by all other directors was worked out to ascertain score of such director.
Board (excluding members of the committee being evaluated) collectively discussed and evaluated performance of each committee on the given criteria. Based on consensus, rating was assigned and then simple average thereof was worked out for score of such committee.
Each member of the Board evaluated performance of the Board on the given criteria. The simple average of rating assigned by each Board member was aggregated and average thereof was worked out to ascertain performance of the Board.
15. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Form AOC-2 prescribed under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014 provides for disclosure of (a) details of contracts or arrangements or transactions not at armâs length basis and (b) details of material contracts or arrangement or transactions at armâs length basis.
All the transactions entered into by the Company with the related parties during the year were pursuant to the contract or arrangement approved by the Audit Committee and the Board of Directors. The transactions so entered into were in the ordinary course of business of the Company and on armâs length basis. The contract or arrangement or transactions were neither material in terms of the Policy on materiality of related party transactions adopted by the Company nor it exceeded the threshold limit prescribed pursuant to first proviso to Section 188(1) of the Companies Act, 2013. However, without going by the materiality as aforesaid, the details of material/major related party contracts/ arrangement/transactions at armâs length basis and entered into in the ordinary course of business of the Company are given in Form No. AOC-2 given under Annexure-F1.
However, every contract or arrangement entered into pursuant to Section 188(1) of the Companies Act, 2013 is referred to in Annexure-F2 pursuant to Section 188(2) of the Companies Act, 2013. These contracts or arrangements are in the ordinary course of business and terms thereof are on armâs length basis, and have been approved by the Audit Committee and the Board of Directors.
16. EXTRACT OF ANNUAL RETURN
Pursuant to Section 134(3)(a) of the Companies Act, 2013, the extract of the Annual Return as provided under Section 92(3) of the Companies Act, 2013, as on March 31, 2018 is given in Annexure-G.
17. PARTICULARS OF EMPLOYEES AND OTHER REMUNERATION RELATED DISCLOSURES
A statement showing name and other particulars of the employees in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, is given in Annexure-H.
The remuneration related and other disclosure required in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, are given in Annexure-I.
18. EMPLOYEE STOCK OPTION PLAN
The disclosure of details in respect of the Companyâs Employee Stock Option Plan, as required under the Companies (Share Capital and Debentures) Rules, 2014 are set out in Annexure-J to this report.
19. RISK MANAGEMENT
The Board of Directors has developed and implemented risk management policy for the Company. The Board periodically monitors the risk management plan and reviews mitigation measure taken in relation thereto.
20. INTERNAL FINANCIAL CONTROLS
The Board has adopted internal financial controls encompassing policies and procedures for ensuring the orderly and efficient conduct of the business, including adherence to Companyâs policies, the safeguarding of the Companyâs assets, prevention and detection of fraud and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information. The specific internal financial controls with reference to financial statements include internal audit of important activities and processes relating to preparation of financial statements, adoption of well-defined standard operating procedure for business transactions and compliance relating thereto, use of ERP for accuracy and control, review of periodically prepared financial statements with objective to ensure that financial statements present true and fair view and are correct, sufficient, credible and in compliance with legal and regulatory requirement.
Neither management of the Company has come across any instance of fraud during the year 2017-18 nor the auditors of the Company has reported any such instance to the Audit Committee.
21. LOANS, GUARANTEES AND INVESTMENTS
During the year, the Company has not given any loan or guarantee or made any investment attracting the provisions of Section 186 of the Companies Act, 2013. Hence, there is no information to be furnished pursuant to Section 134(3)(g) of the Companies Act, 2013.
22. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The management discussion and analysis report for the year 2017-18 is attached as Annexure-K.
23. SIGNIFICANT AND MATERIAL ORDERS
No regulator or court has passed, during the year, any significant or material order impacting going concern status and Companyâs operations in future.
24. AUDITORS
The members at last annual general meeting held on 19-9-2017 has appointed Damania & Varaiya, Chartered Accountants (having firm registration no. 102079W), as statutory auditor of the Company for a term of five consecutive years from the conclusion of the said annual general meeting. However, ratification of appointment of auditor by members at every annual general meeting is now not required pursuant to amendment made to Section 139 of the Companies Act, 2013.
25. SECRETARIAL AUDIT REPORT
Ashish Bhatt & Associates, Practising Company Secretaries, Secretarial Auditor of the Company, carried out secretarial audit for the financial year 2017-18 as provided under Section 204 of the Companies Act, 2013 and the rules made there under. The secretarial audit report given by the said auditor is annexed to this report as Annexure-L.
26. HEALTH AND SAFETY
The Company continues to accord high priority to health and safety of employees at all manufacturing locations. During the year under review, the Company conducted safety training programmes for increasing disaster preparedness awareness among all employees at the plants. Training programmes and mock drills for safety awareness were also conducted for all employees at the plants.
27. APPRECIATION
Your Directors record their sincere gratitude to the banks for their assistance and shareholders, business associates, medical professionals and customers for their continued support and faith in the Company, and to employees of UNIQUE FAMILY for their valuable services and commitment.
For and on behalf of the Board of Directors
J. B. Mody
Chairman & Managing Director
Place : Mumbai
Date : May 25, 2018
Mar 31, 2017
The directors are pleased to present the forty first report and audited financial statement of the Company for the year ended on March 31, 2017.
1. FINANCIAL HIGHLIGHTS
The following is the highlight of financial performance of the Company during the year under review.
(Rs. in lakhs)
|
2016-17 |
*2015-16 |
|
|
Revenue from Operations |
119,869.42 |
116,493.57 |
|
Other Income |
4,589.03 |
5,567.60 |
|
Total Income |
124,458.45 |
122,061.17 |
|
Profit before finance cost and depreciation |
26,804.91 |
28,139.69 |
|
Less: Finance cost |
500.13 |
1,029.48 |
|
Less: Depreciation & Amortisation expense |
4,626.42 |
4,040.87 |
|
Profit before tax |
21,678.36 |
23,069.34 |
|
Tax Expense |
4,381.90 |
5,149.05 |
|
Net Profit after tax |
17,296.46 |
17,920.29 |
|
Other Comprehensive Income (Net of tax) |
(270.43) |
(30.98) |
|
Total Comprehensive Income after tax |
17,026.03 |
17,889.31 |
|
Earning per share of Rs.2 (In Rs.) |
20.07 |
21.09 |
* prepared in accordance with new accounting standards prescribed under Companies (Indian Accounting Standards) Rules, 2015 applicable to the Company w.e.f. April 1, 2016.
2. DIVIDEND
Your directors recommend a dividend of Re.1 (50%) per equity share of face value of Rs.2. This together with dividend distribution tax will absorb Rs.1,020.87 lakhs. The Board has not proposed any amount for transfer to reserves.
3. BUY-BACK OF EQUITY SHARES
With a view to return surplus cash and pursuant to authority conferred under the Articles of Association of the Company, the Board has approved buy-back of fully paid up equity shares of face value of Rs.2 by the Company up to 12,50,000 equity shares at a price of Rs.400 per equity share for a total consideration not exceeding Rs.5,000 lakhs (âbuy-back amountâ) excluding transaction costs, on proportionate basis through tender offer. The number of equity shares authorised for buy-back represents 1.47% of the total outstanding equity shares, while the buy-back amount represents 3.85% of the equity share capital and free reserves as at March 31, 2017. This buy-back will be implemented in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998.
4. OPERATIONS/STATE OF AFFAIRS
The total net sales for 2016-17 at Rs.1,148.70 crores were 4.11% higher compared to the net sales in the previous year. The sales growth was lower as exports to certain markets were impacted due to high depreciation of local currencies against US dollar. The domestic formulations business continued to do well and registered growth of 17.27% at sales of Rs.477.70 crores, while contrast media products at net sales of Rs.43.91 crores registered growth of 8.91%. Total formulations exports at Rs.523.99 crores were lower compared to the previous year. API sales were also lower at Rs.91.70 crores.
The operating profit at Rs.175.89 crores was affected by de-growth in international business. The profit before tax and total comprehensive income after tax for the year stood at Rs.216.78 crores and Rs.170.26 crores respectively.
5. RESPONSIBILITY STATEMENT
The directors confirm:
(i) that in the preparation of the annual accounts for the year under review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of financial year 2016-17 and of profit of the Company for that year;
(iii) that they have 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;
(iv) that they have prepared the annual accounts for the year ended on March 31, 2017 on a going concern basis;
(v) that they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and
(vi) that they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
6. SUBSIDIARIES
The report on financial performance and financial position of the subsidiary companies as on March 31, 2017 is presented in Annexure-A.
7. CORPORATE GOVERNANCE-ANNUAL REPORT DISCLOSURES
A certificate from auditors of the Company on compliance of conditions of corporate governance and management discussion and analysis report are annexed to this report. Compliance report on corporate governance, business responsibility report, dividend distribution policy and information on number and dates of meetings of the Board and Committees thereof held during the financial year indicating the number of meetings attended by each director form part of this annual report.
8. PUBLIC DEPOSITS
The Company has not accepted any deposit covered under Chapter V of the Companies Act, 2013 during the year. All the public deposits accepted prior to the commencement of the said Act have been repaid in 2014-15.
9. DIRECTORS
In accordance with the provisions of the Companies Act, 2013, Mr. Kamlesh L. Udani retires by rotation at the ensuing annual general meeting. He, being eligible, has offered himself for re-appointment.
All independent directors have given a declaration to the Board that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 as well as in Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements] Regulations, 2015.
During the year, the Board appointed Dr. Manoj R. Mashru as an additional director on November 18, 2016. He is an independent director and holds office up to the date of ensuing annual general meeting. The Company has received, pursuant to Section 160 of the Companies Act, 2013, a notice from a member proposing candidature of Dr. Manoj R. Mashru to the office of director of the Company. It is proposed to appoint Dr. Manoj R. Mashru as an independent director of the Company. Dr. Manoj R. Mashru is a leading Cardiologist and possesses expertise in the field of medicine. His detailed profile is given in notice for the ensuing annual general meeting. This profile is deemed to form part of this report.
During the year, two independent directors resigned from the Board viz. Mr. Jashvantrai B. Joshi resigned due to his pre-occupations and Dr. Niranjan N. Maniar resigned due to his health reasons.
Total 4 meetings of the Board of Directors of the Company were held during the year 2016-17. They were held on May 20, 2016, August 26, 2016, November 18, 2016 and February 10, 2017.
10. POLICY ON DIRECTORSâ APPOINTMENT AND REMUNERATION POLICY
The Companyâs policy on directorsâ appointment is set out in Annexure-B. The Companyâs policy on directorsâ remuneration including criteria for determining qualifications, positive attributes and independence of a director as well as policy relating to remuneration of Key Managerial Personnel and other employees is set out in Annexure-C.
11. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars as required under Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 are given in Annexure D.
12. CORPORATE SOCIAL RESPONSIBILITY
Pursuant to the requirement of Section 135 of the Companies Act, 2013, the Board of the Company has constituted Corporate Social Responsibility (CSR) Committee comprising of Dr. Satyanarain Agarwala, independent director, Mr. Bharat P. Mehta and Mr. Pranabh Mody. The CSR Committee has formulated and recommended CSR Policy to the Board, which the Board has approved. The details and contents of CSR policy and annual report on CSR in the prescribed form are set out in Annexure-E.
The Company spent Rs.265.23 lakhs on prescribed CSR projects/activities during 2016-17 as against Rs.346.39 lakhs being 2% of the average net profits of the Company made during the three immediately preceding financial years. Pursuant to second proviso to Section 135(5) of the Companies Act, 2013, Board has to specify that the Company could not spend the entire amount of Rs.346.39 lakhs as it did not come across other deserving activity/ projects for the benefit of needy section of the society.
13. AUDIT COMMITTEE AND VIGILANCE MECHANISM
The Board has constituted Audit Committee comprising of Mr. Durga Dass Chopra, Dr. Satyanarain Agarwala, Mr. Dinesh Mody and Ms. Krupa Gandhi. There has been no instance of non-acceptance of recommendation of Audit Committee by the Board.
The Board of directors has established vigil mechanism in the form of Whistle Blower Policy to enable directors, employee and other stakeholders to make written Protected disclosures (as defined in the policy) to the Chairman of the Redressal Committee for evaluation and investigation. The Policy empowers the Redressal Committee to investigate if the issue raised constitutes protected disclosure, complete the investigation in a time bound manner and recommend, after consultation with the Audit Committee, necessary corrective action to the concerned manager for implementation. The Policy provides for access of whistle blower to the Chairman of the Audit Committee in appropriate or exceptional circumstances. The Policy provides for adequate safeguards of whistle blowers against any kind of victimisation or unfair treatment but also provides for taking stern disciplinary action against who abuses the protection so granted. This functioning of vigil mechanism is periodically reviewed by the Audit Committee. The Company has posted the Whistle Blower Policy on its website www.jbcpl.com
14. ANNUAL PERFORMACE EVALUATION
The Board of Directors has laid down the criteria for evaluation of performance of individual directors, Board of Directors and Committees of the Board. The Nomination and Remuneration Committee first carried out evaluation of performance of each director during 2016-17 against the criteria. The result of this process was placed before the Board at its meeting held on May 23, 2017, which (excluding the director being evaluated) also independently carried out evaluation of performance of each director. The Board at the said meeting also carried out performance evaluation of each Board constituted committee (excluding the members of the Committee being evaluated) against the criteria. The Boardâs own performance was also evaluated by each individual director based on the criteria. The Chairman of the Board then reviewed the outcome of entire performance evaluation process and shared the same with the Board members.
15. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
Form AOC-2 prescribed under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014 provides for disclosure of (a) details of contracts or arrangements or transactions not at armâs length basis and (b) details of material contracts or arrangement or transactions at armâs length basis.
All the transactions entered into by the Company with the related parties during the year were pursuant to the contract or arrangement approved by the Audit Committee and the Board of Directors. The transactions so entered into were in the ordinary course of business of the Company and on armâs length basis. The contract or arrangement or transactions were neither material in terms of the Policy on materiality of related party transactions adopted by the Company nor it exceeded the threshold limit prescribed pursuant to first proviso to Section 188(1) of the Companies Act, 2013. Therefore, there is no information to be furnished in Form AOC-2. However, every contract or arrangement entered into pursuant to Section 188(1) of the Companies Act, 2013 is referred to in Annexure-F pursuant to Section 188(2) of the Companies Act, 2013. These contracts or arrangements are in the ordinary course of business and terms thereof are on armâs length basis, and have been approved by the Audit Committee and the Board of Directors.
16. EXTRACT OF ANNUAL RETURN
Pursuant to Section 134(3)(a) of the Companies Act, 2013, the extract of the Annual Return as provided under Section 92(3) of the Companies Act, 2013, as on March 31, 2017 is given in Annexure-G.
17. PARTICULARS OF EMPLOYEES AND OTHER REMUNERATION RELATED DISCLOSURES.
A statement showing name and other particulars of the employees in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, is given in Annexure-H.
The remuneration related and other disclosure required in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, are given in Annexure-I.
18. EMPLOYEE STOCK OPTION PLAN
The disclosure of details in respect of the Companyâs Employee Stock Option Plan, as required under the Companies (Share Capital and Debentures) Rules, 2014 are set out in Annexure-J to this report.
19. RISK MANAGEMENT
The Board of Directors has developed and implemented risk management policy for the Company. The Board periodically monitors the risk management plan and reviews mitigation measure taken in relation thereto.
20. INTERNAL FINANCIAL CONTROLS
The Board has adopted internal financial controls encompassing policies and procedures for ensuring the orderly and efficient conduct of the business, including adherence to Companyâs policies, the safeguarding of the Companyâs assets, prevention and detection of fraud and errors, the accuracy and completeness of the accounting records and timely preparation of reliable financial information. The specific internal financial controls with reference to financial statements include internal audit of important activities and processes relating to preparation of financial statements, adoption of well-defined standard operating procedure for business transactions and compliance relating thereto, use of ERP for accuracy and control, review of periodically prepared financial statements with objective to ensure that financial statements present true and fair view and are correct, sufficient, credible and in compliance with legal and regulatory requirement.
Neither management of the Company has come across any instance of fraud during the year 2016-17 nor the auditors of the Company has reported any such instance to the Audit Committee.
21. LOANS, GUARANTEES AND INVESTMENTS
During the year, the Company has not given any loan or guarantee or made any investment attracting the provisions of Section 186 of the Companies Act, 2013. Hence, there is no information to be furnished pursuant to Section 134(3)(g) of the Companies Act, 2013.
22. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
The management discussion and analysis report for the year 2016-17 is attached as Annexure-K.
23. SIGNIFICANT AND MATERIAL ORDERS
No regulator or court has passed, during the year, any significant or material order impacting going concern status and Companyâs operations in future.
24. AUDITORS
Pursuant to provisions of Section 139(2) of the Companies Act, 2013, M/s J.K. Shah & Co., Chartered Accountants, would remain in office as auditors of the Company up to the date of ensuing annual general meeting.
The Board of Directors recommend appointment of Damania & Varaiya, Chartered Accountants (having firm registration no. 102079W), as statutory auditor of the Company for a term of five consecutive years from the conclusion of ensuing annual general meeting. The said firm is well equipped and possesses requisite qualification and experience commensurate with the size and requirement of the Company. Damania & Varaiya has submitted its written consent to their appointment as well as certificate that their appointment, if made, will be in accordance with the prescribed conditions. They have also confirmed that they satisfy the criteria provided in Section 141 of the Companies Act, 2013.
25. SECRETARIAL AUDIT REPORT
Ashish Bhatt & Associates, Practising Company Secretaries, Secretarial Auditor of the Company, carried out secretarial audit for the financial year 2016-17 as provided under Section 204 of the Companies Act, 2013 and the rules made there under. The secretarial audit report given by the said auditor is annexed to this report as Annexure-L.
26. HEALTH AND SAFETY
The Company continues to accord high priority to health and safety of employees at all manufacturing locations. During the year under review, the Company conducted safety training programmes for increasing disaster preparedness awareness among all employees at the plants. Training programmes and mock drills for safety awareness were also conducted for all employees at the plants.
27. APPRECIATION
Your Directors record their sincere gratitude to the banks for their assistance and shareholders, business associates, medical professionals and customers for their continued support and faith in the Company, and to employees of UNIQUE FAMILY for their valuable services and commitment.
For and on behalf of the Board of Directors
J. B. Mody
Chairman & Managing Director
Place : Mumbai
Date : May 23, 2017
Mar 31, 2016
The directors are pleased to present the fortieth report and audited
financial statement of the Company for the year ended on March 31,
2016.
1. FINANCIAL HIGHLIGHTS
The following is the highlight of financial performance of the Company
during the year under review as well as appropriation of profits.
(Rs. in lakhs)
Particulars 2015-16 2014-15
Revenue from Operations (Net) 114,816.77 106,142.12
Other Income 5,292.39 1,040.88
Total Revenue 120,109.16 107,183.00
Profit before finance cost and
depreciation 27,672.43 20,335.42
Less: Finance cost 922.27 665.01
Less: Depreciation & Amortisation expense 4,040.56 3,759.99
Profit before tax 22,709.60 15,910.42
Provision for tax:
Current Tax 4,950.00 4,200.00
Deferred tax 120.75 352.17
Profit for the period after tax 17,638.85 11,358.25
Balance brought forward from previous year 44,241.46 47,725.65
Amount available for appropriation 61,880.31 59,083.90
Appropriations:
Proposed dividend 424.10 11,873.15
Tax on proposed dividend 86.34 2,417.09
Interim dividend paid 3,816.90 -
Tax on Interim dividend 777.04 -
Less: Residual value of assets
without useful life adjusted
against opening balance - 347.40
Less: Adjustment pursuant to the
Scheme of Amalgamation and Arrangement - 204.80
Less: Dividend and dividend
distribution tax on equity shares
issued under ESOP before AGM
held on 19-08-2015 1.81 -
Balance carried forward to balance sheet 56,774.12 44,241.46
Total 61,880.31 59,083.90
2. DIVIDEND
Your directors recommend a final dividend of Re.0.50 (25%) per equity
share of face value of Rs. 2.
During the year, the Board of Directors declared interim dividend of
Rs. 4.50 (225%) per equity share of face value of Rs. 2. The final
dividend, if declared, together with interim dividend already paid
would result in total outgo of Rs. 51.04 crores including dividend
distribution tax. In the previous year, the Company paid dividend of
Rs. 14 per equity share comprising of special dividend of Rs. 10 per
share and regular dividend of Rs. 4 per share.
3. OPERATIONS/STATE OF AFFAIRS
The net sales during the year at Rs. 1,119.93 crores were 7.88% higher
over the previous year. The total operating revenue at Rs. 1,148.17
crores were 8.17% higher; while the total income for the year at Rs.
1,201.09 crores shows increase of 12.06% due to higher other income.
The operating profit of Rs. 184.12 crores registered margin improvement
of 9.57% over previous year due to favourable product mix as well as
containment of costs. The profit before tax and profit after tax at Rs.
227.10 crores and Rs. 176.39 crores registered growth of 42.73% and
55.30% respectively.
The domestic formulations business achieved good growth of 13.06% at
sales of Rs. 423.33 crores, while contrast media products achieved
growth of 14.76% at sales of Rs. 40.32 crores. The overall
formulations exports at Rs. 531.65 crores registered growth of 5.96%,
which is lower mainly due to depreciation of currencies against US
Dollar. The exports to Rest of the World countries at Rs. 390.72 crores
registered growth of 11.60% in Rupee terms. However, the other
formulations exports including exports for Russia-CIS market were
lower. The total sales of bulk drugs stood at Rs. 100.56 crores against
Rs. 103.76 crores in the previous year.
4. RESPONSIBILITY STATEMENT
The directors confirm:
(i) that in the preparation of the annual accounts for the year under
review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and
applied them consistently and made judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of financial year 2015-16 and of
profit of the Company for that year;
(iii) that they have 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;
(iv) that they have prepared the annual accounts for the year ended on
March 31, 2016 on a going concern basis;
(v) that they have laid down internal financial controls to be followed
by the Company and that such internal financial controls are adequate
and were operating effectively; and
(vi) that they have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
5. SUBSIDIARIES
During the year, the Company''s subsidiary Unique Pharmaceutical
Laboratories FZE ("UPL FZE") acquired 2,194,030 Ordinary Shares in
Biotech Laboratories (Pty.) Ltd. ("Biotech") from Afrika Biopharma
Investments (Pty). Ltd. Consequent to restructuring of existing 49%
shareholding in Biotech and issue of certain shares by Biotech after
the aforesaid acquisition, UPL FZE now holds 95.24% voting capital of
Biotech. Accordingly, Biotech has become subsidiary of the Company.
Subsequently, the Company''s subsidiary J.B. Healthcare Pvt. Ltd.,
Jersey, has been dissolved.
The report on financial performance and financial position of the
subsidiary companies as on March 31, 2016 is presented in Annexure-A.
6. CORPORATE GOVERNANCE
A certificate from auditors of the Company on compliance of conditions
of corporate governance is annexed to this report. The management
discussion and analysis report and compliance report on corporate
governance as required under Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015
("the said Regulations") form part of this annual report. This annual
report contains information as on and has been prepared in accordance
with the provisions of the said Regulations as applicable on March 31,
2016.
7. PUBLIC DEPOSITS
During the year, the Company has not accepted any deposit covered under
Chapter V of the Companies Act, 2013. All the public deposits accepted
prior to the commencement of the said Act have been repaid in the
previous year.
8. DIRECTORS
In accordance with the provisions of the Companies Act, 2013, Mr.
Pranabh Mody retires by rotation at the ensuing annual general meeting.
He, being eligible, has offered himself for re-appointment.
All independent directors have given a declaration to the Board that
they meet the criteria of independence as provided in Section 149(6) of
the Companies Act, 2013 as well as in Regulation 16 of Securities and
Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015.
During the year, the Board appointed Mr. Shaukat H. Merchant as an
additional director on February 3, 2016. He is an independent director
and holds office up to the date of ensuing annual general meeting. The
Company has received, pursuant to Section 160 of the Companies Act,
2013, a notice from a member proposing candidature of Mr. Shaukat H.
Merchant to the office of director of the Company. It is proposed to
appoint Mr. Shaukat H. Merchant as an independent director of the
Company. Mr. Shaukat Merchant is a Senior Solicitor & Senior Partner of
the Law Firm M/s. M&M Legal Ventures, Advocates & Solicitors, Mumbai
which was established by him in the year 1993. He possesses expertise
in the field of law. His detailed profile is given in notice for the
ensuing annual general meeting. This profile is deemed to form part of
this report.
During the year, Mr. Mahesh K. Shrof, independent director, resigned
from the Board due to his health reasons. Total 5 meetings of the Board
of Directors of the Company were held during the year 2015-16. They
were held on May 20, 2015, August 5, 2015, November 4, 2015, February
3, 2016 and March 11, 2016.
9. POLICY ON DIRECTORS'' APPOINTMENT AND REMUNERATION POLICY
The Company''s policy on directors'' appointment is set out in
Annexure-B. The Company''s policy on directors'' remuneration including
criteria for determining qualifications, positive attributes and
independence of a director as well as policy relating to remuneration
of Key Managerial Personnel and other employees is set out in
Annexure-C.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars as required under Section 134(3)(m) of the Companies
Act, 2013 read with the Companies (Accounts) Rules, 2014 are given in
Annexure D.
11. CORPORATE SOCIAL RESPONSIBILITY
Pursuant to the requirement of Section 135 of the Companies Act, 2013,
the Board of the Company has constituted Corporate Social
Responsibility (CSR) Committee comprising of Dr. Satyanarain Agarwala,
independent director, Mr. Bharat P. Mehta and Mr. Pranabh Mody. The CSR
Committee has formulated and recommended CSR Policy of the Company to
the Board, which the Board has approved. The details and contents of
CSR policy and annual report on CSR in the prescribed form are set out
in Annexure-E.
The Company spent Rs. 243.58 lakhs on prescribed CSR projects/
activities during 2015-16 as against Rs. 274.78 lakhs being 2% of the
average net profits of the Company made during the three immediately
preceding financial years. Pursuant to second proviso to Section 135(5)
of the Companies Act, 2013, Board has to specify that the Company could
not spend the entire amount of Rs. 274.78 lakhs as it did not come
across other deserving activity/projects for the benefit of needy
section of the society.
12. AUDIT COMMITTEE AND VIGILANCE MECHANISM
The Board has constituted Audit Committee comprising of Mr. Durga Dass
Chopra, Dr. Satyanarain Agarwala, Mr. Dinesh Mody, Dr. N.N. Maniar and
Ms. Krupa Gandhi. There has been no instance of non-acceptance of
recommendation of Audit Committee by the Board.
The Board of directors has established vigil mechanism in the form of
Whistle Blower Policy to enable directors, employees and other
stakeholders to make written Protected disclosures (as defined in the
policy) to the Chairman of the Redressal Committee for evaluation and
investigation. The Policy empowers the Redressal Committee to
investigate if the issue raised constitutes Protected disclosure,
complete the investigation in a time bound manner and recommend, after
consultation with the Audit Committee, necessary corrective action to
the concerned manager for implementation. The Policy provides for
access of whistle blower to the Chairman of the Audit Committee in
appropriate or exceptional circumstances. The Policy provides for
adequate safeguards of whistle blowers against any kind of
victimisation or unfair treatment but also provides for taking stern
disciplinary action against who abuses the protection so granted. This
functioning of vigil mechanism is periodically reviewed by the Audit
Committee. The Company has posted the Whistle Blower Policy on its
website www.jbcpl.com
13. ANNUAL PERFORMACE EVALUATION
The Board of Directors has laid down the criteria for evaluation of
performance of individual directors, Board of Directors and Committees
of the Board. The Nomination and Remuneration Committee first carried
out evaluation of performance of each director during 2015-16 against
the criteria. The result of this process was placed before the Board at
its meeting held on May 20, 2016, which (excluding the director being
evaluated) also independently carried out evaluation of performance of
each director. The Board at the said meeting also carried out
performance evaluation of each Board constituted committee (excluding
the members of the Committee being evaluated) against the criteria. The
Board''s own performance was also evaluated by each individual director
based on the criteria. The Chairman of the Board then reviewed the
outcome of entire performance evaluation process and shared the same
with the Board members.
14. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the transactions entered into by the Company with the related
parties during the year were pursuant to the contract or arrangement
approved by the Audit Committee and the Board of Directors. The
transactions so entered into were in the ordinary course of business of
the Company and on arm''s length basis. The contract or arrangement or
transactions were neither material in terms of the Policy on
materiality of related party transactions adopted by the Company nor it
exceeded the threshold limit prescribed pursuant to first proviso to
Section 188(1) of the Companies Act, 2013. Therefore, there is no
information to be furnished in Form AOC-2. However, every contract or
arrangement entered into pursuant to Section 188(1) of the Companies
Act, 2013 is referred to in Annexure-F pursuant to Section 188(2) of
the Companies Act, 2013. The terms of these contracts or arrangements
are on arm''s length basis and in ordinary course of business, and have
been approved by the Audit Committee and the Board of Directors.
15. EXTRACT OF ANNUAL RETURN
Pursuant to Section 134(3)(a) of the Companies Act, 2013, the extract
of the Annual Return as provided under Section 92(3) of the Companies
Act, 2013, as on March 31, 2016 is given in Annexure-G.
16. PARTICULARS OF EMPLOYEES AND OTHER REMUNERATION RELATED
DISCLOSURES.
A statement showing name and other particulars of the employees in
terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2)
and 5(3) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, is given in Annexure-H.
The remuneration related and other disclosure required in terms of
Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, are given in Annexure-I.
17. EMPLOYEE STOCK OPTION PLAN
The disclosure of details in respect of the Company''s Employee Stock
Option Plan, as required under the Companies (Share Capital and
Debentures) Rules, 2014 are set out in Annexure-J to this report.
18. LOANS, GUARANTEES AND INVESTMENTS
The particulars of loans and guarantees given and investments made
under Section 186 of the Companies Act, 2013 during the year and
outstanding as at the year-end are given in Annexure-K.
19. RISK MANAGEMENT
The Board of Directors has developed and implemented risk management
policy for the Company. The Board periodically monitors the risk
management plan and reviews mitigation measure taken in relation
thereto.
20. INTERNAL FINANCIAL CONTROLS
The Board has adopted internal financial controls encompassing policies
and procedures for ensuring the orderly and efficient conduct of the
business, including adherence to Company''s policies, the safeguarding
of the Company''s assets, prevention and detection of fraud and errors,
the accuracy and completeness of the accounting records and timely
preparation of reliable financial information. The specific internal
financial controls with reference to financial statements include
internal audit of important activities and processes relating to
preparation of financial statements, adoption of well defined standard
operating procedure for business transactions and compliance relating
thereto, use of ERP for accuracy and control, review of periodically
prepared financial statements with objective to ensure that financial
statements present true and fair view and are correct, sufficient,
credible and in compliance with legal and regulatory requirement.
Neither management of the Company has come across any instance of fraud
during the year 2015-16 nor the auditors of the Company has reported
any such instance to the Audit Committee.
21. ORDER OF NATIONAL GREEN TRIBUNAL
In proceeding instituted by certain NGOs, National Green Tribunal, Pune
Bench ("Tribunal"), by its judgement and Order dated 8-1-2016 ("the
said Order"), inter alia, held that grant of ex-post facto
environmental clearance by the Ministry of Environment and Forests
("MoEF") under Circular dated 14-5-2002 issued by MoEF was not in
accordance with the provisions of the Environment (Protection) Act,
1986. Accordingly, the environmental clearance granted to the Company
on 23-12-2002 in respect of its bulk drugs unit at Panoli, Gujarat
("the said unit") and such clearance granted to certain other
respondents companies under EIA Notification dated 27-1-1994 has been
held to be bad in law and the Tribunal consequently ordered closure of
industrial activities of all the respondents'' industrial units
including the Company''s said unit. The Company fled Application before
the Tribunal for review of its said Order on the ground that the
Company has another environmental clearance dated 8-8-2007 issued by
MoEF under EIA Notification dated 14-9-2006 and Consolidated Consent
and Authorisation dated 2-11-2013 issued by Gujarat Pollution Control
Board. The Tribunal has, however, not allowed the Company''s Review
Application by judgement and Order dated 17-5-2016. The Tribunal has
stayed its said judgement and Order dated 17-5-2016 for a period of two
months by an Order passed on 18-5-2016. The Company is now in the
process of fling an appeal before the Supreme Court. This Order does
not impact going concern status of the Company.
Your Directors believe that the Company holds valid and subsisting
clearance and consent for running of the said unit.
22. AUDITORS AND AUDITORS REPORT
The Board of Directors recommends re-appointment of M/s J.K. Shah &
Co., Chartered Accountants, as auditors of the Company, to hold office
after conclusion of ensuing annual general meeting until conclusion of
the next annual general meeting. M/s J.K. Shah & Co., being eligible,
has submitted their written consent and certificate of eligibility.
In respect of the auditors'' observation contained in paragraph (i) (c)
of Annexure-A to the Auditors'' report, your directors have to inform
the members that the said observation pertain to a residential fat in
Kolkata purchased on May 15, 1992 at cost of Rs. 2.64 lakhs (w.d.v. as
on March 31, 2016 Rs. 1.62 lakhs), which is being used by the Company
in the ordinary course of business. The purchase agreement in respect
of this premise could not be then registered due to unavailability of
the Seller. However, the Company is in continuous possession. The
Company has re-initiated efforts to get the said document registered.
23. SECRETARIAL AUDIT REPORT
Ashish Bhatt & Associates, Practising Company Secretaries, Secretarial
Auditor of the Company, carried out secretarial audit for the financial
year 2015-16 as provided under Section 204 of the Companies Act, 2013
and the rules made there under. The secretarial audit report given by
the said auditor is annexed to this report as Annexure-L.
24. HEALTH AND SAFETY
The Company continues to accord high priority to health and safety of
employees at all manufacturing locations. During the year under review,
the Company conducted safety training programmes for increasing
disaster preparedness awareness among all employees at the plants.
Training programmes and mock drills for safety awareness were also
conducted for all employees at the plants.
25. APPRECIATION
Your Directors record their sincere gratitude to the banks for their
assistance and shareholders, business associates, medical professionals
and customers for their continued support and faith in the Company, and
to employees of UNIQUE FAMILY for their valuable services and
commitment.
For and on behalf of the Board of Directors
J. B. Mody
Chairman & Managing Director
Place : Mumbai
Date : May 20, 2016
Mar 31, 2015
Dear Members,
The directors are pleased to present the thirty-nineth report and
audited financial statement of the company for the year ended on March
31,2015.
1. FINANCIAL HIGHLIGHTS
The following is the highlight of financial performance of the company
during the year under review as well as appropriation of profits.
(Rs in lakhs)
2014-15 2013-14
Revenue from Operations (Net) 106,142.12 95,653.39
Other Income 1,040.88 3,753.77
Total Income 107,183.00 99,407.16
Profit before finance cost and depreciation 20,335.42 19,177.99
Less: Finance cost 665.01 612.70
Less: Depreciation & Amortisation expense 3,759.99 2,716.51
Profit before extraordinary item and tax 15,910.42 15,848.78
Less: Exceptional Item: Revision of purchase
price in respect of sale of Russia-CIS OTC - 6,450.00
Business Undertaking
Profit before tax 15,910.42 9,398.78
Provision for tax:
Current Tax 4,200.00 3,550.00
Earlier year's tax - (572.98)
Deferred tax 352.17 (208.56)
MAT Credit of earlier years - (212.23)
Profit for the period after tax 11,358.25 6,842.55
Balance brought forward from previous year 47,725.65 44,542.81
Amount available for appropriation 59,083.90 51,385.36
Appropriations:
Proposed dividend 11,873.15 2,543.23
Tax on proposed dividend 2,417.09 432.22
Transfer to General Reserve - 684.26
Less: Residual value of assets without useful
life adjusted against opening balance 347.40 -
Less: Adjustment pursuant to the Scheme of
Amalgamation and Arrangement 204.80 -
Balance carried forward to balance sheet 44,241.46 47,725.65
Total 59,083.90 51,385.36
2. DIVIDEND
Your directors recommend a dividend of Rs. 14 (Rs. 3 per equity share in
the previous year) per equity share of face value of Rs. 2, comprising of
special dividend of Rs.10 per share and regular dividend of Rs. 4 per share
for the year 2014-15. This dividend would be paid on the total number
of equity shares issued by the company as on the date of book closure
for the purpose. This dividend of Rs. 14 per share together with dividend
distribution tax will absorb Rs. 142.90 crores.
3. OPERATIONS/STATE OF AFFAIRS
The net sales during the year at Rs. 1,038.14 crores were 11.10% higher
over the previous year, while the total revenue for the year at Rs.
1,071.83 crores was 7.82% higher over the previous year. The previous
year's other income included Rs. 17.64 crores being write back of excess
provision for expenses in relation to
Russia-CIS OTC business sold by the company. While the profit before
tax at Rs. 159.10 crores was marginally higher when compared against
profit before tax and exceptional item of the previous year, the profit
after tax for the year stood at Rs. 113.58 crores.
The domestic formulations business continued to do well and achieved
overall sales of Rs. 409.57 crores that represents growth of 15.22%. The
prescription products business at sales of Rs. 373.43 grew by 15.95% over
the previous year, while the contrast media business sales of Rs. 35.13
crores grew by 7.95%. The company plans to continue to focus on brand
building and therapy building with aim of increasing the share of focus
products.
The total formulations exports during the year at Rs. 501.76 crores were
8.09% higher over the previous year. Out of this, the exports to rest of
the world countries at Rs. 350.11 crores grew by 16.83% in Rupee terms,
while the exports for Russia- CIS market at Rs. 69.26 crores, though not strictly comparable with the previous year, were lower. The sales of bulk
drugs at Rs. 103.76 crores were 4.45% higher over the previous year.
4. RESPONSIBILITY STATEMENT
The directors confirm:
(i) that in the preparation of the annual accounts for the year under
review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and
applied them consistently and made judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the company at the end of financial year 2014-15 and of
profit of the company for that year;
(iii) that they have 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;
(iv) that they have prepared the annual accounts for the year ended on
March 31,2015 on a going concern basis;
(v) that they have laid down internal financial controls to be followed
by the company and that such internal financial controls are adequate
and were operating effectively; and
(vi) that they have devised proper systems to ensure compliance with
the provisions of all applicable laws and that such systems were
adequate and operating effectively.
5. SUBSIDIARIES AND JOINT VENTURE
The report on financial performance and financial position of the
subsidiary companies and a joint venture as on March 31, 2015 is
presented in Annexure-A. During the year,
J.B. Chemicals & Pharmaceuticals Private Limited, Singapore, ceased to
be the company's subsidiary consequent to its dissolution.
6. CORPORATE GOVERNANCE
A certificate from auditors of the company on compliance of conditions
of corporate governance is annexed to this report. The management
discussion and analysis report and compliance report on corporate
governance as required by Clause 49 of the Listing Agreement form part
of this annual report. The corporate governance report contains
information as on and has been prepared in accordance with the
provisions as applicable on March 31,2015.
7. PUBLIC DEPOSITS
At the commencement of the year, the company had aggregate fixed
deposits of Rs. 1088.45 lakhs accepted from public and shareholders of
the company. Pursuant to the provisions of Section 74 of the Companies
Act, 2013, the company during the year has repaid the entire amount
along with interest to the deposit holders. The company did not accept
or renew any deposit during the year. Accordingly, no deposit accepted
by the company prior to the commencement of the Companies Act, 2013
remained unpaid at the end of the year.
8. DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with provisions of the Companies Act, 2013, Mr. Bharat P.
Mehta retires by rotation at the ensuing annual general meeting. He,
being eligible, has offered himself for re-appointment.
All independent directors have given a declaration to the Board that
they meet the criteria of independence as provided in Section 149(6) of
the Companies Act, 2013 as well as Clause 49 of the Listing Agreement.
During the year, the Board appointed Mr. Devang R. Shah as an
additional director on December 16, 2014. He is an independent director
and holds office up to the date of ensuing annual general meeting. It
is proposed to appoint Mr. Devang Shah as independent director of the
company. The company has received, pursuant to Section 160 of the
Companies Act, 2013, a notice from a member proposing candidature of
Mr. Devang Shah to the office of director of the company.
During the year, Mr. B.S. Mehta and Mr. Sanjay Asher, independent
directors, resigned from the Board. Mr. Bhavesh Joshi who was appointed
as a Chief Financial Officer resigned from services of the company and
the Board has in his place appointed Mr. Vijay D. Bhatt as Chief
Financial Officer. 6 meetings of the Board of directors of the company
were held during the year 2014-15.
9. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION POLICY
The company's policy on directors' appointment is set out in
Annexure-B. The company's policy on directors' remuneration including
criteria for determining qualifications, positive attributes and
independence of a director as well as policy relating to remuneration
of Key Managerial Personnel and other employees is set out in
Annexure-C.
10. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars as required under Section 134(3)(m) of the Companies
Act, 2013 read with the Companies (Accounts) Rules, 2014 are given in
Annexure-D.
11. CORPORATE SOCIAL RESPONSIBILITY
Pursuant to the requirement of Section 135 of the Companies Act, 2013,
the Board of the company has constituted Corporate Social
Responsibility (CSR) Committee comprising of Dr. Satyanarain Agarwala,
independent director, Mr. Bharat P. Mehta and Mr. Pranabh Mody. The CSR
Committee has formulated and recommended CSR Policy of the company to
the Board, which the Board has approved. The details and contents of
CSR policy and annual report on CSR in the prescribed form are set out
in Annexure-E.
12. AUDIT COMMITTEE AND VIGILANCE MECHANISM
The Board has constituted audit committee comprising of Mr. Durga Dass
Chopra, Dr. Satyanarain Agarwala, Mr. Dinesh B. Mody, Dr. N.N. Maniar
and Ms. Krupa Gandhi. There has been no instance of non-acceptance of
recommendation of audit committee by the Board.
The Board of directors has established vigil mechanism in the form of
Whistle Blower Policy to enable directors, employee and other
stakeholders to make written Protected disclosures (as defined in the
policy) to the Chairman of the Redressal Committee for evaluation and
investigation. The Policy empowers the Redressal Committee to
investigate if the issue raised constitutes Protected disclosure,
complete the investigation in a time bound manner and recommend, after
consultation with audit committee, necessary corrective action to the
concerned manager for implementation. The policy provides for access
of whistle blower to the chairman of the audit committee in appropriate
or exceptional circumstances. The policy provides for adequate
safeguards of whistle blowers against any kind of victimisation or
unfair treatment but also provides for taking stern disciplinary action
against who abuses the protection so granted. This functioning of
vigil mechanism is periodically reviewed by the audit committee. The
company has posted the Whistle Blower Policy on its website
www.ibcpl.com.
13. ANNUAL PERFORMACE EVALUATION
The Board of directors has laid down the criteria for evaluation of
performance of individual directors, Board of directors and committees
of the Board. The Nomination and Remuneration Committee first carried
out evaluation of performance of each director during the year against
the criteria. The result of this process was placed before the Board at
its meeting held on May 20, 2015, which (excluding the director being
evaluated) also independently carried out evaluation of performance of
each director. The Board at the said meeting also carried out
performance evaluation of each Board constituted committee (excluding
the members of the committee being evaluated) against the criteria. The
Board's own performance was also evaluated by each individual director
based on the criteria.
The chairman of the Board then reviewed the outcome of entire
performance evaluation process and shared the same with the Board
members.
14. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All transactions entered into by the company with related parties
during the year were pursuant to the contract or arrangement approved
by the audit committee and the board of directors. The transactions so
entered into were in the ordinary course of business of the company and
on arm's length basis. The contract or arrangement or transactions were
neither material in terms of policy on materiality of related party
transactions adopted by the company nor it exceeded the threshold limit
prescribed pursuant to first proviso to Section 188(1) of the Companies
Act, 2013. Therefore, provision of information in Form AOC-2 is not
applicable. However, every contract or arrangement approved by the
Board pursuant to Section 188(1) of the Companies Act, 2013 during the
year under review is referred to in Annexure-F pursuant to Section
188(2) of the Companies Act, 2013. These contracts or arrangements are
on arm's length basis and in ordinary course of business.
15. EXTRACT OF ANNUAL RETURN
Pursuant to Section 134(3)(a) of the Companies Act, 2013, the extract
of the annual return as provided under Section 92(3) of the Companies
Act, 2013, as on March 31, 2015 is given in Annexure-G.
16. PARTICULARS OF EMPLOYEES AND OTHER REMUNERATION RELATED DISCLOSURES
A statement showing name and other particulars of employees in terms of
Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3)
of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014, is given in Annexure-H.
The remuneration related and other disclosure required in terms of
Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules,
2014, are given in Annexure-I.
17. EMPLOYEE STOCK OPTION PLAN
The disclosure of details in respect of the company's Employee Stock
Option Plan, as required under the Companies (Share Capital and
Debentures) Rules, 2014 are set out in Annexure-J to this report.
18. LOANS, GUARANTEES AND INVESTMENTS
The particulars of loans and guarantees given and investments made
under Section 186 of the Companies Act, 2013 during the year and
outstanding as at the year-end are given in Annexure-K.
19. RISK MANAGEMENT
The Board of directors has developed and implemented risk management
policy for the company. Pursuant to the Listing Agreement, the Board
has constituted risk management committee and delegated monitoring and
reviewing of the risk management plan to the committee. The status of
mitigation measure in respect of risk management plan is reviewed by
the risk management committee periodically.
20. INTERNAL FINANCIAL CONTROLS
The Board has adopted internal financial controls encompassing policies
and procedures for ensuring the orderly and efficient conduct of the
business, including adherence to company's policies, the safeguarding
of the company's assets, prevention and detection of fraud and errors,
the accuracy and completeness of the accounting records and timely
preparation of reliable financial information. The specific internal
financial controls with reference to financial statements include
internal audit of important activities and processes relating to
preparation of financial statements, adoption of well defined standard
operating procedure for business transactions and compliance relating
thereto, use of ERP for accuracy and control, review of periodically
prepared financial statements with objective to ensure that financial
statements present true and fair view and are correct, sufficient,
credible and in compliance with legal and regulatory requirement.
21. SIGNIFICANT AND MATERIAL ORDERS
No significant or material order has been passed by the regulators or
courts or tribunals against the company.
22. AUDITORS
The board of directors recommends re-appointment of M/s J.K. Shah &
Co., Chartered Accountants, as auditors of the company, to hold office
after conclusion of ensuing annual general meeting until conclusion of
the next annual general meeting. M/s J.K. Shah & Co., being eligible,
have submitted their written consent and certificate of eligibility.
23. SCHEME OF AMALGAMATION AND ARRANGEMENT
The Scheme of Amalgamation and Arrangement between Jyotindra Mody
Holdings Private Limited and Ansuya Mody Securities Private Limited and
Dinesh Mody Securities Private Limited and Kumud Mody Securities
Private Limited and Shirish B. Mody Investments Private Limited and
Bharati S. Mody Investments Private Limited ("Transferor Companies")
and J. B. Chemicals & Pharmaceuticals Limited ("Transferee Company")
and their respective shareholders under Sections 391 to 394 read with
Sections 100 to 103 of the Companies Act, 1956 and Section 55 of the
Companies Act, 2013 and
any other applicable provisions of the Companies Act, 1956 and the
Companies Act, 2013 ("Scheme"), which was approved by the Board on
15/4/2014 and members of the company at court convened meeting held on
14/10/2014 and public shareholders through postal ballot and e-voting
on 16/10/2014, was sanctioned by the Hon'ble Bombay High Court on
27/2/2015. The Scheme has become effective on 13/4/2015 with appointed
date of 1/4/2014.
Accordingly, the Transferor Companies stand merged with the company and
the merger has been given effect to in the financial statements of the
company for the year ended on March 31, 2015. Consequently, 4,33,42,270
equity shares of FY Rs. 2 held by the Transferor Companies in the company
have been cancelled and the company has allotted 4,33,42,270 equity
shares of Rs. 2 each credited as fully paid up to the shareholders of the
Transferor Companies in accordance with the fair share entitlement
ratio specified in the Scheme.
24. SECRETARIAL AUDIT REPORT
Ashish Bhatt & Associates, company secretaries, secretarial auditor of
the company, carried out secretarial audit as provided under Section
204 of the Companies Act, 2013 and the rules made there under for the
financial year 2014-15. The secretarial audit report given by the said
auditor is annexed to this report as Annexure-L.
25. HEALTH AND SAFETY
The company continues to accord high priority to health and safety of
employees at all manufacturing locations. During the year under review,
the company conducted safety training programmes for increasing
disaster preparedness awareness among all employees at the plants.
Training programmes and mock drills for safety awareness were also
conducted for all employees at the plants.
26. APPRECIATION
Your directors record their sincere gratitude to the banks for their
assistance and shareholders, business associates, medical professionals
and customers for their continued support and faith in the company and
to employees of UNIQUE FAMILY for their valuable services and
commitment.
For and on behalf of the Board of Directors
Place: Mumbai J. B. Mody
Date: May 20, 2015 Chairman & Managing Director
Mar 31, 2014
Dear Members,
The directors are pleased to present the thirty eighth report and
audited statement of accounts of the company for the year ended on
March 31, 2014.
1. FINANCIAL RESULTS
The following is the summary of f nancial performance of the company
during the year under review as well as appropriation of prof ts.
(Rs in lakhs)
2013-14 2012-13
Revenue from Operations (Net) 95,653.39 81,642.25
Other Income 3,753.77 2,596.07
Total Income 99,407.16 84,238.32
Prof t before f nance cost and 19,177.99 13,738.23
depreciation
Less: Finance cost 612.70 524.18
Less: Depreciation & Amortisation 2,716.51 2,439.58
expense
Prof t before extraordinary item 15,848.78 10,774.47
and tax
Less: Exceptional Item: Revision 6,450.00 Â
of purchase price in respect of
sale of Russia-CIS OTC Business
Undertaking
Prof t before tax 9,398.78 10,774.47
Provision for tax:
Current Tax (Net) 2,977.02 1,736.00
Deferred tax (208.56) 541.80
MAT Credit (212.23) 2.82
Prof t for the period after tax 6,842.55 8,493.85
Balance brought forward from 44,542.81 39,871.45
previous year
Amount available for 51,385.36 48,365.30
appropriation
Appropriations:
Proposed dividend 2,543.23 2,541.22
Tax on proposed dividend 432.22 431.88
Transfer to General Reserve 684.26 849.39
Balance carried forward to balance 47,725.65 44,542.81
sheet
Total 51,385.36 48,365.30
2. DIVIDEND
Your directors recommend a dividend of Rs. 3 (Rs. 3 per equity share in the
previous year) per equity share of face value of Rs. 2 for the year
2013-14. This dividend would be paid on the total number of equity
shares issued by the company as on the date of book closure for the
purpose.
3. OPERATIONS
The normal business performance of the company during the year 2013-14
was better than the last year. During the year, the net revenue from
operations at Rs. 956.53 crores was 17.16% higher against Rs. 816.42 crores
in the previous year, while the total income for the year at Rs. 994.07
crores was 18.00% higher against Rs. 842.38 crores in the previous year.
The prof t before exceptional item and tax for the year at Rs. 158.49
crores shows growth of 47.10% over the previous year. During the year,
the company paid Rs. 64.50 crores to the purchaser of company''s
Russia-CIS OTC business undertaking on account of revision of purchase
price following mutual settlement of the disputes keeping in view the
on-going business relationship and in order to avoid the cost and delay
of arbitration. Consequently, the prof t before tax and prof t after
tax for the year stood at Rs. 93.99 crores and Rs. 68.42 crores
respectively.
The domestic formulations business achieved growth of 16.66%. During
the current year, the company aims to improve performance based on
harnessing potential of the existing products, further improving
productivity of f eld personnel coupled with selective new products
launches and cost reduction programmes.
The exports to the Rest of the world markets achieved good growth of
20.63% in terms of billing currency and 35.80% in Rupee terms. The
company continues to focus on US, UK, Canada, Australia, South Africa,
Africa, Latin American, Asian and Middle-East markets for future
growth. The sales in Russia-CIS markets were lower than the last year.
However, the company continues to invest for growth in this region.
The total sales of bulk drugs achieved growth of 59.53%.
The company earned foreign exchange of Rs. 560.54 crores (on FOB basis)
and spent foreign exchange of Rs. 156.86 crores, and thus earned
valuable foreign exchange for the country.
4. RESPONSIBILITY STATEMENT
The directors conf rm:
(i) that in the preparation of the annual accounts for the year under
review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and
applied them consistently and made judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of af airs of the company at the end of f nancial year 2013-14 and of
prof t of the company for that year;
(iii) that they have taken proper and suf cient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the company and for preventing and detecting fraud and other
irregularities; and
(iv) that they have prepared the annual accounts for the year ended on
March 31, 2014 on a going concern basis.
5. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars as 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 Annexure 1 to
this report.
6. PARTICULARS OF EMPLOYEES
The particulars of employees of the company, in terms of section 217
(2A) of the Companies Act, 1956, read with the Companies (Particulars
of Employees) Rules, 1975 as amended are given in Annexure 2 to this
report.
7. SUBSIDIARY COMPANIES
During the year, the company set up a wholly owned subsidiary company
viz. Unique Pharmaceutical Laboratories FZE in Dubai, with object to
place right focus on the marketing and promotion activity of Russia-CIS
business so as to achieve enhanced market penetration and target
growth.
The accounts, report of the directors and auditors and other
statement(s) as set out in section 212 of the Companies Act, 1956, in
respect of the company''s subsidiaries viz. OOO Unique Pharmaceutical
Laboratories, J. B. Healthcare Pvt. Ltd., J. B. Chemicals &
Pharmaceuticals Private Limited and LLC Unique Pharmaceutical
Laboratories are not attached pursuant to the general exemption granted
by the Central Government pursuant to general circular No.2/2011 dated
February 8, 2011. The f rst f nancial year of Unique Pharmaceutical
Laboratories FZE, Dubai will end on March 31, 2015. The particulars of
performance of the subsidiaries for and its f nancial positions as on
March 2014 is given in consolidated balance sheet as required in terms
of the said general exemption. The members are informed that annual
accounts of the said subsidiaries and the related detailed information
will be made available on request. The accounts of the said
subsidiaries are also open for inspection by the members at the
registered of ce of the company.
8. EMPLOYEE STOCK OPTION PLAN
The disclosures in respect of the company''s Employee Stock Option Plan,
as required under the Securities and Exchange Board of India (Employee
Stock Option Scheme and Employee
Stock Purchase Scheme) Guidelines, 1999 are set out in Annexure 3 to
this report.
9. CORPORATE GOVERNANCE
A certif cate from auditors of the company on compliance of conditions
of corporate governance is annexed to this report. The management
discussion and analysis report and compliance report on corporate
governance as required by clause 49 of the listing agreement form part
of this annual report. The corporate governance report contains
information as on and has been prepared in accordance with the
provisions as applicable on March 31, 2014.
10. PUBLIC DEPOSITS
As on the year end, total unmatured deposits stand at Rs.1087.60 lakhs,
while deposits amounting to Rs. 0.85 lakhs remained unclaimed. During the
year, the company repaid deposits of Rs. 540.40 lakhs.
11. HEALTH AND SAFETY
The company continues to accord high priority to health and safety of
employees at all manufacturing locations. During the year under review,
the company conducted safety training programmes for increasing
disaster preparedness awareness among all employees at the plants.
Training programmes and mock drills for safety awareness were also
conducted for all employees at the plants.
12. DIRECTORS
In accordance with provisions of the Companies Act, 2013, Mr. Shirish
B. Mody and Mr. Kamlesh L. Udani retire by rotation at the ensuing
annual general meeting. They, being eligible, have of ered themselves
for re-appointment. During the year, Ms. Krupa R. Gandhi was appointed
as an additional director.
Mr. D.D. Chopra, Dr. S. Agarwala, Mr. Rajiv C. Mody, Dr. N.N. Maniar
and Mr. Mahesh K. Shrof are the directors appointed by the members at
general meeting and are independent directors of the company within the
meaning of Listing Agreement entered into with the stock exchanges. It
is proposed to appoint them as independent directors of the company
pursuant to the Companies Act, 2013 in order to ensure compliance with
mandatory provisions thereof in relation to appointment of independent
directors.
Mr. Jashvantrai Joshi was appointed by the board on April 18, 2012, in
casual vacancy caused by resignation of Mr. Rohan Shah. He is also an
independent director and holds of ce up to the date of ensuing annual
general meeting. Ms. Krupa R. Gandhi was appointed by the board on
January 15, 2014, as
an additional director. She is also an independent director and holds
of ce up to the date of ensuing annual general meeting. It is also
proposed to appoint Mr. Jashvantrai Joshi and Ms. Krupa R. Gandhi as
independent directors of the company. The company has received pursuant
to section 160 of the Companies Act, 2013 notice from a member
proposing candidature of Mr. Jashvantrai Joshi and Ms. Krupa R. Gandhi
to the of ce of director of the company.
13. AUDITORS
The board of directors recommends re-appointment of M/s J.K. Shah &
Co., Chartered Accountants, as auditors of the company, to hold of ce
after conclusion of ensuing annual general meeting until conclusion of
the next annual general meeting. M/s J.K. Shah & Co., being eligible,
have submitted their written consent and certif cate of eligibility.
14. COST AUDITORS
The board of directors appointed N.I. Mehta & Co., Cost Accountants, as
cost auditors, to audit the cost accounts for pharmaceutical activities
for the f nancial year 2013-14.
The cost audit report in respect of pharmaceutical activities of the
company for the f nancial year ended on March 31, 2013 was f led with
the Central Government on September 23, 2013, which was within the
prescribed period of one hundred and eighty days from the close of the
said f nancial year.
15. SCHEME OF AMALGAMATION AND ARRANGEMENT
Subsequent to the year-end, the board of directors has approved a
Scheme of Amalgamation and Arrangement between Jyotindra Mody Holdings
Private Limited and Ansuya Mody Securities Private Limited and Dinesh
Mody Securities Private Limited and Kumud Mody Securities Private
Limited
and Shirish B. Mody Investments Private Limited and Bharati S. Mody
Investments Private Limited ("Transferor Companies") and J. B.
Chemicals & Pharmaceuticals Limited ("Transferee Company") and their
respective shareholders under sections 391 to 394 read with sections
100 to 103 of the Companies Act, 1956 and section 55 of the Companies
Act, 2013 and any other applicable provisions of the Companies Act,
1956 and the Companies Act, 2013 ("Scheme"). The company has received
Observation Letter from Bombay Stock Exchange and National Stock
Exchange Conveying their no-objection to the Scheme. The Scheme and the
other related documents have been placed on the company''s website
www.jbcpl.com.
16. INCREASE IN PAID UP CAPITAL
Subsequent to the year-end, the company has issued and allotted 38,125
equity shares of Rs. 2 each consequent to exercise of options granted
under employee stock option scheme of the company as approved by the
members. Consequently, the paid-up share capital is increased to
8,47,69,750 equity shares of Rs. 2 each.
17. APPRECIATION
Your directors record their sincere gratitude to the banks for their
assistance and shareholders, business associates, medical professionals
and customers for their continued support and faith in the company and
to employees of UNIQUE FAMILY for their valuable services and
commitment.
For and on behalf of the Board of Directors
Place: Mumbai J. B. Mody
Date : August 5, 2014 Chairman & Managing Director
Mar 31, 2013
The directors are pleased to present the thirty seventh report and
audited statement of accounts of the company for the year ended on
March 31, 2013.
1. FINANCIAL RESULTS
The following is the summary of financial performance of the company
during the year under review as well as appropriation of profits.
(Rs. in lakhs)
2012-13 2011-12
Revenue from Operations (Net) 81,642.25 68,642.13
Other Income 2,596.07 2,851.19
Total Income 84,238.32 71,493.32
Profit before finance cost and 13,738.23 9,270.99
depreciation
Less: Finance cost 524.18 2,177.69
Less: Depreciation & Amortisation 2,439.58 2,230.40
expense
Profit before extraordinary item and tax 10,774.47 4,862.90
Exceptional Item: Income on sale of - 76,059.34
Russia-CIS OTC business (Net)
Provision for tax:
Current Tax 2,170.00 16,550.00
MAT Credit (431.18) (109.77)
Deferred tax 541.80 212.07
Profit for the period after tax 8,493.85 64,269.94
Balance brought forward from previous 39,871.45 23,893.10
year
Amount available for appropriation 48,365.30 88,163.04
Appropriations:
Special interim dividend - 33,881.92
Tax on special interim dividend - 5,496.49
Final dividend - 848.53
Tax on final dividend - 137.66
Proposed dividend 2,541.22 -
Tax on proposed dividend 431.88 -
Transfer to General Reserve 849.39 6,426.99
Transfer to Contingency Reserve - 1,500.00
Balance carried forward to balance 44,542.81 39,871.45
sheet
Total 48,365.30 88,163.04
2. DIVIDEND
Your directors recommend a dividend of Rs. 3 (Rs. 41 including special
dividend of Rs. 40 per equity share in the previous year) per equity
share of face value of Rs. 2 for the year 2012-13. This would absorb
Rs. 29.73 crores including dividend distribution tax.
3. OPERATIONS
The financial performance for the current year is strictly not
comparable with that of the previous year due to sale of Russia-CIS OTC
business undertaking during the previous year. During the year, the net
income from operations at Rs. 816.42 crores was 18.94% higher over the
previous year, while the total income for the year at Rs. 842.38 crores
was 17.83% higher against Rs. 714.93 crores (excludes exceptional
income) in the previous year. The profit before tax and profit after
tax for the year stood at Rs. 107.74 crores and Rs. 84.94 crores
respectively.
The domestic formulations business achieved growth in line with the
industry growth, while the focus products continued to achieve
encouraging growth. During the current year, the company aims for
improved performance based on harnessing potential of the existing
products, penetration in rural markets and improving productivity of
field personnel coupled with selective new products launches. The
exports to Rest of the world markets achieved good growth of 22% in
terms of billing currency. In this business, the company has placed
enhanced focus on US market in view of encouraging sales in the last
two years. Besides this market, the company''s focus markets include
South Africa, UK, Canada, Australia and semi-regulated markets. The Rx
business in Russia-CIS too fared well. The company is, however, in the
process of investing in this region for future growth. The sales of
bulk drugs achieved growth of 56%.
As the members may be aware, the company has received from Cilag GmbH
International ("Cilag") a notice of claims under business Sale and
Purchase Agreement dated May 23, 2011 and Supply Agreement dated May
23, 2012 for estimated amount of US$ 33.30 million (which coincides
with the amount held in the escrow account) and US$ 5 million
respectively. The company has contested these claims. In the spirit of
overall business, the company and Cilag are in discussion to resolve
the differences.
4. RESPONSIBILITY STATEMENT
The directors confirm:
(i) that in the preparation of the annual accounts for the year under
review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and
applied them consistently and made judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the company at the end of financial year 2012-13 and of
profit of the company for that year;
(iii) that they have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of
the company and for preventing and detecting fraud and other
irregularities; and
(iv) that they have prepared the annual accounts for the year ended on
March 31, 2013 on a going concern basis.
5. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars as 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 Annexure A to
this report.
6. PARTICULARS OF EMPLOYEES
The particulars of employees of the company, in terms of section
217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975 as amended are given in Annexure
B to this report.
7. SUBSIDIARY COMPANIES
The accounts, report of the directors and auditors and other
statement(s) as set out in section 212 of the Companies Act, 1956, in
respect of the company''s subsidiaries viz. OOO Unique Pharmaceutical
Laboratories, J. B. Healthcare Pvt. Ltd., J. B. Chemicals &
Pharmaceuticals Private Limited and LLC Unique Pharmaceutical
Laboratories are not attached pursuant to the general exemption granted
by the Central Government pursuant to general circular No.2/2011 dated
February 8, 2011. The particulars of performance of the subsidiaries
for and its financial position as on March 2013 is given in
consolidated balance sheet as required in terms of the said general
exemption. The members are informed that annual accounts of the said
subsidiaries and the related detailed information will be made
available on request. The accounts of the said subsidiaries are also
open for inspection by the members at the registered office of the
company.
8. EMPLOYEE STOCK OPTION PLAN
The disclosures in respect of the company''s Employee Stock Option Plan,
as required under the Securities and Exchange Board of India (Employee
Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,
1999 are set out in Annexure C to this report.
9. CORPORATE GOVERNANCE
A certificate from auditors of the company on compliance of conditions
of corporate governance is annexed to this report. The management
discussion and analysis report and compliance report on corporate
governance as required by clause 49 of the listing agreement form part
of this annual report.
10. PUBLIC DEPOSITS
During the year under review, the company repaid deposits of Rs. 351.83
lakhs. As on the year end, total unmatured deposits stood at Rs.
1209.44 lakhs, while deposits amounting to Rs. 0.55 lakhs remained
unclaimed.
11. HEALTH AND SAFETY
The company continues to accord high priority to health and safety of
employees at all manufacturing locations. During the year under
review, the company conducted safety training programmes with the help
of Industries Association for increasing disaster preparedness
awareness among all employees at the plants. Training programmes and
mock drills for safety awareness were also conducted for all employees
at the plants.
12. DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the company, Mr. Rajiv C. Mody, Mr. Pranabh
Mody and Dr. Niranjan N. Maniar retire by rotation at the ensuing
annual general meeting. They, being eligible, have offered themselves
for re-appointment.
Subsequent to the year end, Dr. Rajen D. Shah resigned as a director of
the company. Your board has placed on record appreciation of
contributions made by Dr. Rajen Shah during his tenure as a director of
the company.
13. AUDITORS
M/s J.K. Shah & Co., Chartered Accountants, auditors of the company,
hold office until the conclusion of the ensuing annual general meeting.
M/s J.K. Shah & Co., being eligible, have offered themselves for
re-appointment and have confirmed that their appointment, if made,
would be within the limit prescribed under section 224 (1B) of the
Companies Act, 1956.
14. COST AUDITORS
Subject to approval of the central government, the board of directors
has appointed N. I. Mehta & Co., Cost Accountants, as cost auditors, to
audit the cost accounts for pharmaceutical activities for the year
ending on March 31, 2014.
The cost audit report in respect of pharmaceutical activities of the
company for the financial year ended on March 31, 2012 was filed with
the Central Government on February 6, 2013, which was within the
extended date for filing fixed under General Circular No.2/2013 dated
31-1-2013.
15. APPRECIATION
Your directors record their sincere gratitude to the banks for their
assistance and shareholders, business associates, medical professionals
and customers for their continued support and faith in the company and
to employees of UNIQUE FAMILY for their valuable services and
commitment.
For and on behalf of the Board of Directors
Place : Mumbai J. B. Mody
Date : May 24, 2013 Chairman & Managing Director
Mar 31, 2012
The directors are pleased to present the thirty sixth report and
audited statement of accounts of the company for the year ended on
March 31, 2012.
1. FINANCIAL RESULTS
The following is the summary of financial performance of the company
during the year under review as well as appropriation of profits.
(Rs in lakhs)
2011-12 2010-11
Revenue from Operations (Net) 68,642.13 80,668.90
Other Income 2,851.19 588.44
Total Income 71,493.32 81,257.34
Profit before finance cost and
depreciation 9,480.19 17,379.03
Less: Finance cost 2,386.89 1,018.61
Less: Depreciation 2,230.40 2,265.08
Profit before extraordinary item and tax 4,862.90 14,095.34
Exceptional Item: Income on sale of
Russia-CIS OTC business (Net) 76,059.34 -
Provision for tax:
Current Tax 16,550.00 2,800.00
MAT Credit (109.77) (550.00)
Deferred tax 212.07 19.63
Earlier year's income tax - 6.25
Profit for the period after tax 64,269.94 11,819.46
Balance brought forward from Previous
year 23,893.10 15,221.82
Amount available for appropriation 88,163.04 27,041.28
Appropriations:
Special interim dividend paid 33,881.92 -
Tax on special interim dividend 5,496.49 -
Proposed final dividend 848.53 1,691.78
Tax on proposed final dividend 137.66 274.45
Transfer to General Reserve 6,426.99 1,181.95
Transfer to Contingency Reserve 1,500.00 -
Balance carried forward to balance sheet 39,871.45 23,893.10
Total 88,163.04 27,041.28
2. DIVIDEND
During the year, your board of directors has paid special interim
dividend of Rs 40 per equity share of face value of Rs 2 with a view to
reward the members consequent to gain realized on the sale of
Russia-CIS OTC business undertaking. Your directors now recommend a
final dividend of Rs 1 (50%) per equity share of face value of Rs 2, for
the year 2011-12. The interim dividend has
absorbed Rs 393.78 crores including dividend distribution tax, while the
final dividend will absorb Rs 9.86 crores including dividend
distribution tax.
3. OPERATIONS
The financial performance for the current year is strictly not
comparable with that of the Previous year due to sale of Russia-CIS OTC
business undertaking during the year. The net revenue from operations
was Rs 686.42 crores, while total revenue for the year stood at Rs 714.93
crores. On sale of Russia-CIS OTC business undertaking during the year,
the company earned net income of Rs 760.59 crores. The profit before
this extraordinary item and tax was Rs 48.63 crores, while profit before
tax and profit after tax for the year stood at Rs 809.22 crores and Rs
642.70 crores respectively.
The domestic formulations business achieved reasonable growth during
the year, while the focus products continued to achieve encouraging
growth. Going forward, the company plans to achieve growth through
focus on potential therapeutic groups, new products launches,
penetration in new markets and improving productivity of field
personnel. The exports to Rest of the world markets achieved good
growth of 37%. In this business, the company plans to concentrate on
contract manufacturing to build sustainable revenue stream besides
focus on niche branded generics products. The sales of prescription
products in Russia-CIS were affected due to sale of OTC business. The
company is in the process of establishing necessary infrastructure to
grow sales in this region. The sales of bulk drugs achieved growth of
23%.
The transaction of sale of Russia-CIS OTC business undertaking to Cilag
GmbH International (Cilag), a subsidiary of Johnson & Johnson, was
closed on July 14, 2011. Accordingly, the said business undertaking
now stands transferred to Cilag.
4. RESPONSIBILITY STATEMENT
The directors confirm:
(i) that in the preparation of the annual accounts for the year under
review, the applicable accounting standards have been followed;
(ii) that they have selected appropriate accounting policies and
applied them consistently and made judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of the company at the end of financial year 2011-12 and of
profit of the company for that year;
(iii) that they have taken proper and sufficient care for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies Act, 1956 for
safeguarding the assets of the company and for preventing and detecting
fraud and other irregularities; and
(iv) that they have prepared the annual accounts for the year ended on
March 31, 2012 on a going concern basis.
5. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars as 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 Annexure A to
this report.
6. PARTICULARS OF EMPLOYEES
The particulars of employees of the company, in terms of section 217
(2A) of the Companies Act, 1956, read with the Companies (Particulars
of Employees) Rules, 1975 as amended are given in annexure B to this
report.
7. SUBSIDIARY COMPANIES
The accounts, report of the directors and auditors and other
statement(s) as set out in section 212 of the Companies Act, 1956, in
respect of the company's subsidiaries viz. OOO Unique Pharmaceutical
Laboratories, J. B. Healthcare Pvt. Ltd., J. B. Chemicals &
Pharmaceuticals Private Limited and LLC Unique Pharmaceutical
Laboratories are not attached pursuant to the general exemption granted
by the Central Government pursuant to general circular No.2/2011 dated
February 8, 2011. The particulars of performance of the subsidiaries
for and its financial positions as on March 2012 is given in
consolidated balance sheet as required in terms of the said general
exemption. The members are informed that annual accounts of the said
subsidiaries and the related detailed information will be made
available on request. The accounts of the said subsidiaries are also
open for inspection by the members at the registered office of the
company. Unique Pharmaceutical Laboratories S.R.L. ceased to be
subsidiary during the year.
8. EMPLOYEE STOCK OPTION PLAN
The disclosures in respect of the company's Employee Stock Option
Plan, as required under the Securities and Exchange Board of India
(Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999 are set out in annexure C to this report.
9. CORPORATE GOVERNANCE
A certificate from auditors of the company on compliance of conditions
of corporate governance is annexed to this report. The management
discussion and analysis report and compliance report on corporate
governance as required by clause 49 of the listing agreement form part
of this annual report.
10. PUBLIC DEPOSITS
During the year under review, the company repaid deposits of Rs 540.01
lakhs. As on the year end, total unmatured deposits stood at Rs 1,364.91
lakhs, while deposits amounting to Rs 0.65 lakhs remained unclaimed.
11. HEALTH AND SAFETY
The company continues to accord high priority to health and safety of
employees at all manufacturing locations. During the year under
review, the company conducted safety training programmes with the help
of Ankleshwar Industries Association & Panoli Industries Association
for increasing disaster preparedness awareness among all employees at
the plants. Training programmes and mock drills for safety awareness
were also conducted for all employees at the plants. Safety Day was
observed with safety competition programmes with aim to imbibe safety
awareness among the employees at the plant.
12. DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the company, Mr. Bansidhar S. Mehta, Mr.
Durga Dass Chopra and Mr. Bharat P. Mehta retire by rotation at the
ensuing annual general meeting. They, being eligible, have offered
themselves for re-appointment.
During the year, Mr. Rohan Shah resigned as a director of the company.
Your board has placed on record deep appreciation of contributions made
by Mr. Rohan Shah as a director of the company. On April 18, 2012, your
board has appointed Mr. Jashvantrai B. Joshi as a director to fill
casual vacancy caused by resignation of Mr. Rohan Shah. He is an
independent director on the board. Your board has also appointed Mr.
Sanjay Asher, partner of Crawford Bayley & Co., as alternate director
to Mr. Jashvantrai B. Joshi.
13. AUDITORS
M/s J.K. Shah & Co., Chartered Accountants, auditors of the company,
hold office until the conclusion of the ensuing annual general meeting.
M/s J.K. Shah & Co., being eligible, have offered themselves for
re-appointment and have confirmed that their appointment, if made,
would be within the limit prescribed under section 224 (1B) of the
Companies Act, 1956.
14. COST AUDITORS
Subject to approval of the central government, the board of directors
has appointed N. I. Mehta & Co., Cost Accountants, as cost auditors, to
audit the cost accounts for formulations and bulk drugs activities for
the year ending on March 31, 2013.
The cost audit report in respect of formulations and bulk drug
activities of the company for the financial year ended on March 31,
2011 was filed with the Central Government on August 30, 2011 which was
within the due date i.e. September 27, 2011, for filing the said
report.
15. INCREASE IN PAID UP SHARE CAPITAL
During the year, the Compensation Committee of the board of directors
has allotted 1,90,475 equity shares of Rs 2 each against exercise of
options by several employees under the Employees Stock Option Scheme of
the company, as a result of which the share capital of the company has
increased from Rs 16,90,33,650 divided into 8,45,16,825 equity shares of
Rs 2 each to Rs 16,94,14,600 divided into 8,47,07,300 equity shares of Rs
2 each.
16. APPRECIATION
Your directors record their sincere gratitude to the banks for their
assistance and shareholders, business associates, medical
professionals, customers and fixed deposit holders for their continued
support and faith in the company and to employees of UNIQUE FAMILY for
their valuable services and commitment.
For and on behalf of the Board of Directors
Place : Mumbai J. B. Mody
Date : May 23, 2012 Chairman & Managing Director
Mar 31, 2011
The directors are pleased to present the thirty fifth report and
audited statement of accounts of the company for the year ended on
March 31,2011.
I. FINANCIAL RESULTS
The following is the summary of financial performance of the company
during the year under review.
(Rs. in lakhs)
2010-11 2009-10
Net Sales 78,757.94 67,006.45
Other Income 2,499.40 1,725.34
Total Income 81,257.34 68,731.79
Profit before depreciation,
interest and tax 17,107.72 15,11 1.18
Less: Interest 737.30 894.51
Less: Depreciation 2,265.08 2,122.25
Profit for the year before tax 14,105.34 12,094.42
Provision for tax:
Current Tax 2,800.00 2,057.00
Earlier Years income tax 6.25 (151.79)
Deferred tax 19.63 79.48
Wealth tax 10.00 10.00
MAT Credit (550.00) --
Profit for the year after tax 11,819.46 10,099.73
Balance brought forward from
previous year 15,221.82 8,099.68
Amount available for
appropriation 27,041.28 18,199.41
Appropriations:
Proposed dividend 1,691.78 1,687.38
Tax on proposed dividend 274.45 280.24
Transfer to General Reserve 1,181.95 1,009.97
Balance carried forward to
balance sheet 23,893.10 15,221.82
Total 27,041.28 18,199.41
2. DIVIDEND
Your directors recommend a dividend of Rs.2 (100%) (Rs.2 in the
previous year) per equity share of face value of Rs. 2.
3. OPERATIONS
The net sales for the year under review increased to Rs. 787.58 crores,
an increase of 18% over the previous year, while the total income for
the year stood at Rs. 812.57 crores as against Rs. 687.31 crores in the
previous year. The profit before tax at Rs. 141.05 crores increased by
17% over the previous year due to good growth in exports and domestic
sales, while the profit after tax at Rs. 118.19 crores too was higher
by 17% over the previous year.
The domestic formulations business registered growth of 15%
and is poised for growth as the company has placed increased focus on
this business. The company continues to focus on domestic market and
would make the necessary investments for growth.The exports to rest of
the world markets achieved good growth of 24%. The rest of the world
exports are expected to perform better during the year due to new
initiatives taken by the company. The sales of bulk drugs achieved
growth of 46%, however, the activities in this business remain scaled
down.
4. SALE OF RUSSIA-CIS OTC BUSINESS
Subsequent to the year under review, the board of directors has,
subject to consent of the members, approved the sale of Russia- CIS
over the counter products (OTC) business to Cilag GmbH International
(Cilag), a wholly owned subsidiary of Johnson & Johnson, for a
consideration of Rs. 9385.10 million subject to provisions of the
agreement entered into with Cilag. The sale would involve transfer of
trademarks, product registrations, patents, copyrights, account
receivables as agreed and certain movable assets relating to the said
business. The companys leading brands such as Doktor Mom, Rinza,
Metrogyl Denta and Fitovit are part of the scope of the transaction. As
the OTC brands would have required enormous amount of investment in
sales promotion to achieve next level of growth, your board of
directors thought fit to divest this business in order to protect and
further enhance shareholder value. In addition, the board has also
approved world wide sale of three brands namely Doktor Mom, Rinza and
Fitovit to Cilag for additional consideration of Rs. 60.67 million.
This transaction is subject to fulfilment of certain conditions
precedent including approval of members of the company pursuant to
section 293(1 ){a) of the Companies Act, 1956.This approval is being
sought through postal ballot. Cilag has also entered into a long term
supply agreement with the company for supply of the acquired OTC
products for Russia-CIS market.
5. RESPONSIBILITY STATEMENT
The directors confirm:
i. That in the preparation of the annual accounts for the year under
review, the applicable accounting standards have been followed;
ii. That they have selected appropriate accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the company at the end of financial year 2010-11 and of profit of
the company for that period;
iii. That they have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance
with the provisions of the Companies Act, 1956 for safeguarding the
assets of the company and for preventing and detecting fraud and other
irregularities; and
iv. That they have prepared the annual accounts for the year ended on
March 31,201 I on a going concern basis.
6. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The particulars as 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 AnnexureA to
this report.
7. PARTICULARS OF EMPLOYEES
The particulars of employees of the company, in terms of section 217
(2A) of the Companies Act, 1956, read with the Companies (Particulars
of Employees) Rules, 1975 as amended are given in annexure B to this
report.
8. SUBSIDIARY COMPANIES
The accounts, reports of the directors and auditors and other
statement(s) as set out in section 212 of the Companies Act, 1956, in
respect of the companys subsidiaries viz. Unique Pharmaceutical
Laboratories, Unique Pharmaceutical Laboratories S.R.L..J. B.
Healthcare Pvt. Ltd. and J. B. Chemicals & Pharmaceuticals Pvt. Ltd.
are not attached pursuant to the general exemption granted by the
Central Government vide general circular dated February 8,2011 The
particulars of performance of the subsidiaries for and its financial
positions as on March 201 I is given in the annual report as required
in terms of the said general exemption. The members are informed that
annual accounts of the said subsidiaries and the related detailed
information will be made available on request. The accounts of the said
subsidiaries are also open for inspection by the members at the
registered office of the company. J. B. Life Science Overseas Ltd.
ceased to be subsidiary during the year.
9. EMPLOYEE STOCK OPTION PLAN
The disclosures in respect of the companys Employee Stock Option Plan,
as required under the Securities and Exchange Board of India (Employee
Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,
1999 are set out in annexure C to this report.
10. CORPORATE GOVERNANCE
A certificate from auditors of the company on compliance of conditions
of corporate governance is annexed to this report.
The management discussion and analysis report and compliance report on
corporate governance as required by clause 49 of the listing agreement
form part of this annual report.
11. PUBLIC DEPOSITS
During the year under review, the company repaid deposits of Rs. 126.23
lakhs. As on the year end, total unmatured deposits stood at Rs.
1892.65 lakhs, while deposits amounting to Rs. 3.32 lakhs remained
unclaimed.
12. HEALTH AND SAFETY
The company continues to accord high priority to health and safety of
employees at all manufacturing locations. During the year under review,
the company conducted various programmes and workshops with the help
ofAnkleshwar Industries Association & Panoli Industries Association for
increasing disaster preparedness awareness among all employees at the
plants.Training programmes and mock drills for safety awareness were
also conducted for all employees at the plants. The comprehensive
health check up of the employees was also carried out at all the
plants.
13. DIRECTORS
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the company, Mr. Mahesh K. Shroff, Dr. Rajen
D. Shah and Mr. Rohan P. Shah retire by rotation at the ensuing annual
general meeting. Mr. Mahesh K. Shroff, Dr. Rajen D. Shah and Mr. Rohan
P. Shah, being eligible, have offered themselves for re-appointment.
Dr. Satyanarain Agarwala was appointed as an additional director on
July 24, 2010. As per section 260 of the Companies Act, 1956 read with
Article 126 of the Articles of Association of the company, Dr. Agarwala
holds office only up to the date of ensuing annual general meeting. A
notice has been received from a member pursuant to section 257 of the
Companies Act, 1956, proposing candidature of Dr.Agarwala to the office
of director of the company.The resolution for the appointment of
Dr.Agarwala as a director of the company is being placed at the ensuing
annual general meeting for your consideration.
The board of directors at its meeting held on May 23, 2011, has
re-appointed Mr. Bharat P. Mehta as Whole time director (Planning &
Development), Mr. Pranabh Mody as President & Whole time director
(Operations) and Mr. Kamlesh L. Udani as Executive director (Technical
& Production) for a further period of five years from July I, 201 I.The
necessary resolution for your approval of appointment of and payment of
remuneration to them is being placed at the ensuing annual general
meeting.
14. AUDITORS
M/s J.K. Shah & Co., Chartered Accountants, auditors of the company,
hold office until the conclusion of the ensuing annual general meeting.
M/s J.K. Shah & Co., being eligible, have offered themselves for
re-appointment and have confirmed that their appointment, if made,
would be within the limit prescribed under section 224 (IB) of the
Companies Act, 1956. M/s J.K. Shah & Co has also furnished a copy of
certificate issued to them by Peer Review Board of the Institute of
Chartered Accountants of India.
15. COST AUDITORS
The board of directors has appointed N. I. Mehta & Co., Cost
Accountants, as cost auditors to audit the cost accounts relating to
formulations and bulk drugs activities for the year ending on March 31,
2012, which appointments have been approved by the Central Government.
The cost audit report in respect of formulations and bulk drug
activities of the company for the financial year ended on March 31,
2010 was filed by N. I. Mehta & Co. with the Central Government on
September 14, 2010 which was within the due date i.e. September
27,2010 for filing the said report.
16. INCREASE IN PAID UP SHARE CAPITAL
During the year, the Compensation Committee of the board of directors
has allotted 1,90,475 equity shares of Rs. 2 each against exercise of
options by several employees under the Employees Stock Option Scheme of
the company, as a result of which the share capital of the company has
increased from Rs. 16,86,52,700 divided into 8,43,26,350 equity shares
of Rs.2 each to Rs. 16,90,33,650 divided into 8,45,16,825 equity shares
of Rs.2 each.
Subsequent to the year end, the Compensation Committee of the board of
directors has allotted 72,250 equity shares of Rs. 2 each against
exercise of options by several employees under Employees Stock Option
Scheme of the company. The share capital of the company has
consequently increased to Rs. 16,91,78,150 divided into 8,45,89,075
equity shares of Rs.2 each.
17. APPRECIATION
Your directors record their sincere gratitude to the banks for their
assistance and shareholders, business associates, medical
professionals, customers and fixed deposit holders for their continued
support and faith in the company and to employees of UNIQUE FAMILY for
their valuable services and commitment.
For and on behalf of the Board of Directors
Place: Mumbai J. B. Mody
Date: May 23,2011 Chairman & Managing Director
Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article
More Information on J B Chemicals & Pharmaceuticals Ltd.
-
J B Chemicals & Pharmaceuticals Ltd. Tools
- Bulk Deals
- Block Deals
-
J B Chemicals & Pharmaceuticals Ltd. Company Details
- Company Profile
- Company History
- Management Team
- Capital Structure
- Product Mix
- Banker/Auditor/Registrar
-
Company History
- Rights
- BSE Price History
- NSE Price History
-
J B Chemicals & Pharmaceuticals Ltd. Key Financial Ratios
- Ratios
-
J B Chemicals & Pharmaceuticals Ltd. Results
- Quarterly Results
- Half Yearly Results
- Nine Months Results
- Annual Results
-
J B Chemicals & Pharmaceuticals Ltd. Financial Data
- Audited Results
- Cash Flow
- Balance Sheet
-
J B Chemicals & Pharmaceuticals Ltd. Reports
- Accounting Policies
- Auditors Report
- Directors Report
- Notes To Account
-
J B Chemicals & Pharmaceuticals Ltd. Corporate Announcements
- Book Closure
- Dividend
- Board Meetings
