The Board of Directors of your Company has pleasure in presenting the Board Report pursuant to Section 134(3) of the Companies Act, 2013 comprising the prescribed particulars and information as per the Companies (Management and Administration) Rules, 2014 and Companies Accounts Rules, 2014 in respect of year ended 31.03.2018 as follows:-
a) Number of Meetings of the Board : 08
b) Directors’ Responsibility Statement-
Pursuant to Section 134(5) of the Companies Act, 2013 (Act) your Directors hereby state that:-
i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
ii) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the company for that period;
iii) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
iv) the directors had prepared the annual accounts on a going concern basis; and,
v) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
c) Declaration by Independent Directors under Sub Section 6 of Section 149 :-
The five Independent Directors namely - Dr. Naresh Gaikwad, Dr. V. V. Parashar, Mr. Suprakash Chakravarty, Mrs. Kavita Loya and Mr. Padmakar Joshi have given the required declaration under Sub Section 6 of Section 149 of the Act on 16.04.2018, 16.04.2018, 05.04.2018,
05.04.2018 and 16.04.2018, respectively.
d) Nomination and Remuneration Policy:-
The Company has constituted a Nomination and Remuneration Committee on 21.09.2017 consisting of the following members:-
i) Dr. V. V. Parashar - Chairman.
ii) Dr. Naresh Gaikwad
iii) Mrs. Kavita Loya
iv) Dr. Anwar Siraj Daud, Chairman of the Board.
The criteria laid down in the Companies Act, 2013 and Rules framed thereunder are complied with while appointing the Directors particularly Independent Directors. The Nomination and Remuneration Policy has been formulated and approved by the Nomination and Remuneration Committee in its meeting held on 24.07.2018. Placed as Annexure ( IV )
e) Explanations or comments on qualification/ reservation/adverse remark/disclaimer made by:-
1. Statutory Auditor - Not applicable since there is no comment or qualification.
2. Secretarial Auditor - Not applicable since there is no comment or qualification.
f) Particulars of loans, guarantees or investments under Section 186 :-
a) Loan : NIL
b) Guarantee : NIL
c) Investment : NIL
g) Particulars of contracts or arrangements with Related parties pursuant to Section 188 (1) :
Related parties pursuant to Section 188 (1) During the year, no transaction with related parties was in conflict with the interests of the Company. All transactions entered into by the Company with related parties during the financial year were in the ordinary course of business and on an arm's length pricing basis. . Statements of transactions with related parties are periodically placed before the Audit Committee and are approved. Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed Form AOC - 2, is appended herewith as Annexure V to the Board's Report.
h) The state of Company’s affairs:-
The Company continues to progress in the direction of its strategy to emerge as an innovative drug delivery solution provider with differentiated products in the pharmaceutical market. Its recently developed proprietary and patented orally disintegrating film technology —Thinoral® has elevated the company to market leadership in the OTS technology and business in India. The company is now developing pharmaceutical and nutraceutical products using its Thinoral drug delivery platform for manufacture and supplies globally — particularly in the developed markets. Company has commercialized 18 OTF products.
The Company is also in the process of examining and developing other technology platforms to create new differentiated formulations targeting patient convenience and adherence.
The Company is foraying into emerging and developed markets for supply of semi-finished formulations which are already being developed and marketed in rest of the world (ROW) markets. Its export business especially with respect to its (New Drug Delivery Systems) and its Differentiated product's portfolio have shown a quantum leap.
The finished branded formulations export strategy for increasing company geographical footprint is taking shape and the company registered 38 products in 6 ROW and emerging markets during the year.
The company has as a part of long term strategy and to serve domestic market decided to selectively participate in Government tender business for differentiated generics that have higher margins and has also initiated entry into private domestic institutional market.
The R&D centre of company recognized by Department of Scientific and Industrial Research, employs more than 100 R&D Personnel working on developing proprietary innovative processes and platform technologies to overcome complex formulation challenges resulting in uniquely differentiated formulation products. It has filed during this period patents globally and registered several products in various geographies.
i) The amount proposed to be carried to reserve : NIL
j) The amount of dividend payment recommended : ' 80.59 lacs
k) Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year and the date of the report. : NIL
l) Conservation of energy, technology absorption, foreign exchange earnings and outgo :-
A. Conservation of energy :
(i) The steps taken or impact on conservation of energy;
Your company is striving continuously to conserve every form of energy by adopting innovative measures to reduce wastage and optimize consumption. Notable measures for energy conservation were as follows:
- Unwanted lighting kept off
- Replaced high voltage motors with low voltage motors
- Power consumption by using Temperature Controller
(ii) The steps taken by the Company for utilizing alternate sources of energy; NIL
B. Technology absorption :
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i) The efforts made towards technology absorption:
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41 products were added to the development pipeline of solid oral dosage forms of various molecules. 33 new products had focus for export markets and 8 new products had focus for domestic market. Research is underway for development, evaluation and standardization of solid oral dosage forms such as pellets/MUPs, DC granules, taste masked granules and orally disintegrating strips for gastro-intestinal, cardiovascular and urological disorders apart from antibiotics.
12 new products were successfully transferred from R&D to production floor. Comparative dissolution profiles were established against innovator products, Analytical methods were developed and validated for establishing the stability of these products over its shelf life.
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ii) The benefits derived like product
improvement, cost reduction, product development or import substitution
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The above efforts helped Zim to maintain relevance with its existing clients and offering them value added products. Value was created by offering evaluation of Zim's product against innovator product, analytical data package, stability data package and clinical data package.
New products helped Zim in geographic expansion into new markets. New products were offered to clients using indigenously developed technology. Alternate vendor development was initiated to mitigate cost fluctuations, risk of uninterrupted supply and the risk of sourcing API and excipients for top products.
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iii) In case of imported technology (imported during the last 3 years reckoned from the beginning of the financial year):
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a. The details of technology imported
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NIL
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b. The year of import
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NIL
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c. Whether the technology has been fully absorbed
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Not applicable
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d. If not fully absorbed, areas where absorption has not taken place, and the reasons there of and
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Not applicable
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iv) The expenditure incurred on Research and Development:
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Revenue expenses - ' 937.37 lacs Capital expenses - ' 554.81 lacs
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C) Foreign Exchange earnings and outgo :
i) Foreign exchange earned during the year : ' 14,222.30 lacs
ii) Expenditure in foreign exchange : ' 1,738.88 lacs
m) Risk Management Policy :
This part has been covered under Management Discussion & Analysis Report, section of the Annual Report .
n) Corporate Social Responsibility (CSR) :-
The Company has re-constituted the CSR Committee on 21.09.2017 comprising the following Directors as the members:-
i) Mr. Suprakash Chakravarty - Chairman
ii) Mr. Padmakar S. Joshi
iii) Dr. Anwar Siraj Daud
iv) Mr. Zulfiquar M. Kamal
As per the recommendations of the CSR Committee constituted by the Board, the Board of Directors approved the projects to be undertaken under CSR on 19.03.2015. The policy approved by the Board is as follows:-
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1.
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Major project to be implemented in phases, in a period of 5 to 10 years
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60% to 70%
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2.
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Sanitation and water supply
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5% to 10%
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3.
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Educational and vocational skill development activities
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5% to 10%
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4.
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Contribution to other organizations engaged in activities covered under notified CSR projects
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5% to 10% 100%
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Annual Report on CSR Activities to be included in the Board Report is attached in ANNEXURE - II o) Board Evaluation
Pursuant to the provisions of section 134(3)(p) of the Act read with rule 8(4) of the Companies(Accounts) Rules, 2014 an annual evaluation was carried out by the Board of its own performance as also of its committees and individual Directors. The evaluation was done by the Board after seeking inputs from all Directors, inter-alia covering different aspects viz. composition and structure of the Board, attendance including participation of the Directors at the Board and Committee meetings, observance of governance, quality of deliberation and effectiveness of the procedures adopted by the Board. In evaluating the performance of the individual Directors, criteria such as qualification, knowledge, attendance at meetings and participation in long term strategic planning, leadership qualities, responsibilities shouldered, inter-personal relationships and analytical decision making ability were taken into consideration. In Compliance with regulation 17(10) of the listing regulations, the Board carried out performance evaluation of Independent Directors without the participation of the Directors being evaluated.
The Performance Evaluation of the Chairman and Managing Director was carried out by the Independent Directors. The evaluation process has been explained in the Corporate Governance Report. The Board reviewed the evaluation results as collated by the Nomination and Remuneration Committee.
p) Financial Highlights
(' in Lacs)
Particulars 2018 2017
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Sales (Net)
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27,189.84
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23,501.31
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Other Income
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342.24
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485.49
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Gross Income before Interest and Depreciation
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3,738.39
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3,642.07
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Less : Interest
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934.39
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981.89
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Depreciation
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978.95
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902.25
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Profit Before Exceptional items and Tax
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1,825.06
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1,757.93
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Add : Exceptional item
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586.30
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-
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Profit / (loss) before tax
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2,411.36
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1,757.93
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Profit After Tax
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1,828.78
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1,866.67
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Balance in Profit & Loss Account brought forward
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6,072.24
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4,323.14
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Profit available for appropriation :
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7,901.02
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6,189.81
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Proposed Dividend
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80.29
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79.99
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Corporate Dividend Tax
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16.35
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16.28
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Transfer from other comprehensive Income
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12.37
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21.30
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Transferred to General Reserve
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-
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-
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Net Surplus in P & L A/c
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7,792.01
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6,072.24
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Other adjustments
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-
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-
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Total Reserves & Surplus
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12,790.54
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11,046.90
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q) Change in nature of business if any. : NIL
r) The details of Directors or Key Managerial Personnel who were appointed or Details are as follows : have resigned during the year.
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Sr.
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Name of Director/ KMP
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Date of Appointment/ Resignation
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No.
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1
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Mr. Raghav Kapoor
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12.09.2017 (Resignation)
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2
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Mrs. Kavita Loya
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21.09.2017 (Appointment)
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3
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Mr. Padmakar Joshi
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21.09.2017 (Appointment)
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4
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Mr. R. A. Parasuraman, Company Secretary
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01.09.2017 (Resignation)
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5
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Mr. Piyush Nikhade, Company Secretary
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01.09.2017 (Appointment)
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s)
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Names of Companies which have become or ceased to be its subsidiaries, joint ventures or associate companies during the year.
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Nil
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t)
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Details relating to deposits covered under Chapter V of the Act.
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Company has not accepted any deposits
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u)
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The details of deposits which are not in compliance with the requirements of Chapter V of the Act.
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during the year
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v)
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The details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.
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Nil
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w)
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The details in respect of adequacy of internal financial controls with reference to
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The details are separately covered under
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the financial statements
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Management Discussion & Analysis
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Report.
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x)
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Details of Employee Stock Option Scheme
Pursuant to Section 62 read with Rule 12 of Companies (Share Capital and Debentures) Rules, 2014, the following are the details of ZIM Employee Stock Option Scheme :
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a)
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Option Granted
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1,22,449
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b)
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Option vested
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61,233
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c)
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Option Exercised
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61,233
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d)
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The total number of shares arising as a result of exercise of option
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61,233
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e)
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Option Lapsed
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NIL
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f)
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The exercise price
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' 10/-
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g)
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Variation of terms of options
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NIL
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h)
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Money realised by exercise of option
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' 6,12,330.00
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i)
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Total number of options in force
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61,216
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j)
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Employee wise details of options granted to : Name Designation
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No. of Options Granted
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Mr. Prakash Sapkal Director (Operations)
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50,000
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Mr. Niraj Dhadiwal Director (Business Development)
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50,000
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Mr. Vijay Fudke Sr. Vice President TSD
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22,449
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Total
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1,22,449
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Report on performance and financial position of wholly-owned subsidiary viz; ZIM Laboratories FZE, Sharjah.
During the year 2017-18 there has been no change in the paid-up capital of the company. The cost of turnover, the turnover and the profit calculated by conversion of amount expressed in AED in the subsidiary financial statement at exchange rate as on 31st March, 2018 are as follows:-
Disclosure under section 148 (1) of the Companies Act, 2013
The Company has maintained proper books of accounts as required pursuant to the Rules made by the Central Government for the maintenance of Cost records under sub-section(1) of section 148 of the Act in respect of Company's products.
EXTRACT OF THE ANNUAL RETURN IN FORM MGT-9:
Pursuant to section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, refer “Annexure I”
y) Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.
The following is a summary of sexual harassment complaints received and disposed off during the year 2017-18.
No of complaints received : NIL No of complaints disposed off : NIL
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The cost of turnover
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Rs, 1,79,90,192.00
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Turnover
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Rs, 2,70,03,907.35
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Profit before tax for the year
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Rs, 82,21,302.46
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profit for the year after other expenses
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Rs, 82,21,302.46
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ACKNOWLEDGEMENTS
We take this opportunity to thank the employees for their dedicated service and contribution to the Company.
We also thank our banks, business associates and other stakeholders for their continued support to the Company
For and on behalf of the Board of Directors
(Anwar Siraj Daud)
Chairman
Place : Nagpur
Dated : 14.08.2018
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