DIRECTORS REPORT Dear Members, Your Directors have pleasure in presenting the Seventeenth Annual Report of your Company along with the audited Statement of Accounts for the financial year ended 31st March 2015. The Report also includes the Management Discussion and Analysis Report in accordance with the Guidelines on Corporate Governance and consolidated Financial Statements. Performance We have been able to achieve a turnover of Rs. 2745.07 Lacs. The percentage increase in the turnover is 17% and increase in net profit is 54% respectively when compared to that of previous year. Future Outlook Celestial has already launched Cadalmin Gae (a drug to treat arthritis) in collaboration with CMFRI Cochin(a prestigious ICAR Institute). Cadalmin anti-diabities natural drug shall be launched shortly .Celestial plans to advertise these two product in addition to biovita ( A natural health Drink) and trem ( A fairness herbal cream) in the leading newspaper in ten states to increase the business volume. Dividend: The Company has not declared any dividend during the year. Corporate Governance: As per Clause 49 of the Listing Agreement with the Stock exchanges, a separate section on Corporate Governance is enclosed herewith which forms part of the Annual Report. A certificate from the Auditors of the Company on compliance with the conditions of Corporate Governance as stipulated under the Clause 49 of the Listing Agreement is annexed to this Report. Management Discussion and Analysis: A detailed section of the Management Discussion and Analysis for the period under review as required under Clause 49 of the Listing Agreement is given as a separate statement forming part of the Annual Report. Directors' Responsibility Statement: Pursuant to the requirement under Section 134 of the Companies Act, 2013 with respect to the Director's Responsibility Statement, it is hereby confirmed. i. that in the preparation of the accounts for the financial year ended 31st March 2015, the applicable accounting standards have been followed along with proper explanations for marking all departures, if any. ii. that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit or loss of the company for the year under review. iii. that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and from preventing and detecting fraud and other irregularities. iv. that the directors have prepared the accounts for the financial year ended 31st March 2015 on a going concern basis v. the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and vi. the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively Directors & Key Managerial Personnel (KMP) Directors In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Smt. Padma Singh retired by rotation and being eligible has offered herself for re-appointment. During the period under review, Dr. Sivakumar Bhattiprolu, Director resigned from the Board with effect from 15.11.2014. The Board places on record his appreciation and gratitude for his guidance and contribution during his association with the Company. Key Managerial Personnel The company is taking steps to appoint Key Managerial Personnel as required under Section.203 of the Companies Act, 2013 Declaration from Independent directors on Annual Basis Pursuant to the provisions of Section 149 of the Act, which came into effect from April 1, 2014, Dr.Jeetainder Roy Gour (DIN 02810147) and Dr. D C Sastri (DIN 02682897) were appointed as independent directors at the annual general meeting of the Company held on November 15th, 2014. The terms and conditions of appointment of independent directors are as per Schedule IV of the Act. They have submitted a declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Act and there has been no change in the circumstances which may affect their status as independent director during the year Number of meetings of the board Seven meetings of the board were held during the year. For details of the meetings of the board, please refer to the corporate governance report, which forms part of this report Board Evaluation The board of directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India ("SEBI") under Clause 49 of the Listing Agreements ("Clause 49"). The performance of the Board was evaluated by the Board after seeking inputs from all the directors on the basis of the criteria such as the Board composition and structure, effectiveness of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The Board and the Nomination and Remuneration Committee ("NRC") reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role. In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual directors was also discussed. Policy on directors' appointment and remuneration and other details The Company's policy on directors' appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the corporate governance report, which forms part of the directors' report Disclosure as required under Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 The Disclosure as required under Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 is given in Annexure - A to the Board Report. Particulars of contracts or arrangements with related parties referred in Sub - Section (1) of Section 188 Details of transactions with related parties falling under the scope of Section 188(1) of the Act & Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 (Form No. AOC.2) is given in Annexure - B to the Board Report. Auditors Pursuant to the provisions of Section 139 of the Act and the rules framed thereunder, M/s Lakshmi Purna & Associates, Chartered Accountants, were appointed as statutory auditors of the Company from the conclusion of the sixteenth annual general meeting (AGM) of the Company held on November 15, 2014 till the conclusion of the ninteenth Annual General Meeting to be held in the year 2017, subject to ratification of their appointment at every AGM. Secretarial Auditor Pursuant to the provisions of Section 204 of the Act and the rules framed thereunder, M/s.GMVDR & Associates, Company Secretaries were appointed as Secretarial Auditors of the Company and the Secretarial Audit Report issued by them for the financial year 2014-15 is made a part of this Report. Cost Audit Cost Audit for financial year 2014-15 is not applicable in view of the Cost Audit Amendment Rules, 2014, Government of India, Ministry of Corporate Affairs, Notification, New Delhi, dated 31.12.2014 Extract of the annual return of the Company As provided under Section 92(3) of the Act, the extract of annual return is given in Annexure - C in the prescribed Form MGT-9, which forms part of this report. Qualifications in Auditors' report and secretarial auditors' report The auditors' report does not contain any qualifications, reservations or adverse remarks. Replies to qualifications in Secretarial Audit Report are annexed to this report. Particulars of loans, guarantees or investments The particulars of loans, guarantees and investments have been disclosed in the financial statements Material changes and commitments if any affecting the financial position of the company There are no material changes and commitments affecting the financial position of the Company from the date of closure of financial year to the date of Board Report. Charges The Company has not availed loans from any Bank / Financial Institutions during the financial year under review. Fixed Deposits The Company has not accepted any fixed deposits during the year under review. As such no amount of principal or interest was outstanding on the date of the Balance Sheet. Unpaid / Unclaimed Dividend Dividend which is unclaimed for a period of 7 years shall be transferred to Investor Education & Protection Fund (IEPF). Internal Control Your Company has established a robust system of internal controls to ensure that assets are safeguarded and transactions are appropriately authorized, recorded and reported. The Audit Committee of the Board addresses significant issues raised by both, the Internal Auditors and the Statutory Auditors. The Company believes that the overall internal control system is dynamic and reflects the current requirements at all times, hence ensuring that appropriate procedures and controls, in operating and monitoring practices are in place. Your Company is proactively identifying the areas for further improvement which shall remain an ongoing process. Risk Management The Board of the Company has formed a risk management committee to frame, implement and monitor the risk management plan for the Company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. The development and implementation of risk management policy has been covered in the management discussion and analysis, which forms part of this report. Vigil Mechanism Your Company has adopted a Whistle Blower Policy to report to the management about instances of unethical behaviours, actual or suspected fraud or violation of the Company's code of conduct or ethics policy. Under the policy, the employees can approach Company's Ethics Counsellor/ Chairman of Audit Committee directly. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo: Additional information on conservation of energy, technology absorption and foreign exchange earnings and outgo as required to be disclosed in terms of Section 134(3)(m) of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 is given in Annexure - D and forms part of this report. Employee Relations During the year under review, the company has enjoyed cordial relationship with all section of employees. The company believes that the employees play a vital role in increasing the turnover and profitability of the company and the strength of the company lie in harnessing the manpower in achieving sustained long-term growth in all spheres. Acknowledgements Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your company wishes to place on record its appreciation of employees at all levels for their dedicated contribution towards growth of the company. For and on behalf of the Board of Directors For Celestial Biolabs Limited Dr A N Singh (Chairman & Managing Director) DIN:01756827 Place: Hyderabad Date : 22.10.2015 |