ANNUAL REPORT 2018-19 2 Notice
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CONTENTS Corporate Information ............................................................................................................ 02 Notice .................................................................................................................................... 03 Directors’ Report .................................................................................................................... 14 Annexures to Directors’ Report .............................................................................................. 25 Management Discussion and Analysis .................................................................................. 53 Business Responsibility Report ............................................................................................. 69 Report on Corporate Governance ......................................................................................... 80 Standalone Financial Statements .......................................................................................... 99 Consolidated Financial Statements ....................................................................................... 154 Financial Highlights - 5 years ................................................................................................. 212 CORPORATE INFORMATION BOARD OF DIRECTORS STATUTORY AUDITORS 1. Shri Sudhir Mehta B S R & Co. LLP Chairman Emeritus Chartered Accountants 2. Shri Samir Mehta Executive Chairman REGISTERED OFFICE 3. Shri Shailesh Haribhakti Torrent House, 4. Shri Haigreve Khaitan Off Ashram Road, 5. Ms. Ameera Shah Ahmedabad - 380 009, 6. Ms. Nayantara Bali Gujarat, India 7. Dr. Chaitanya Dutt Phone: + 91 79 26599000 Director (Research and Development) Fax: + 91 79 26582100 AUDIT COMMITTEE CORPORATE IDENTITY NUMBER 1. Shri Shailesh Haribhakti L24230GJ1972PLC002126 Chairman WEBSITE 2. Shri Haigreve Khaitan www.torrentpharma.com 3. Ms. Ameera Shah 4. Ms. Nayantara Bali INVESTOR SERVICES EMAIL ID [email protected] SECURITIES TRANSFER AND STAKEHOLDERS RELATIONSHIP COMMITTEE REGISTRAR AND SHARE TRANSFER AGENT 1. Shri Haigreve Khaitan Karvy Fintech Private Limited Chairman Unit: Torrent Pharmaceuticals Limited 2. Shri Shailesh Haribhakti Karvy Selenium Tower-B, 3. Ms. Ameera Shah Plot No. 31 & 32, Financial District, Gachibowli, Hyderabad – 500 032 NOMINATION AND REMUNERATION COMMITTEE Phone: + 91 40 67162222 1. Shri Shailesh Haribhakti Fax: + 91 40 23001153 Chairman Email Id: [email protected] 2. Shri Samir Mehta 3. Shri Haigreve Khaitan CORPORATE SOCIAL RESPONSIBILITY COMMITTEE 1. Ms. Ameera Shah Chairperson 2. Ms. Nayantara Bali 3. Dr. Chaitanya Dutt RISK MANAGEMENT COMMITTEE 1. Shri Shailesh Haribhakti 2. Shri Haigreve Khaitan 3. Shri Sudhir Menon CHIEF FINANCIAL OFFICER Shri Sudhir Menon VP (LEGAL) & COMPANY SECRETARY Shri Mahesh Agrawal ANNUAL REPORT 2018-19 2 NOTICE NOTICE IS HEREBY GIVEN THAT THE FORTY SIXTH ANNUAL GENERAL MEETING OF THE MEMBERS OF TORRENT PHARMACEUTICALS LIMITED will be held on Tuesday, 23rd July, 2019 at 09:30 AM at J. B. Auditorium, Torrent AMA Centre, Ground Floor, Ahmedabad Management Association, Vastrapur, Ahmedabad – 380 015, Gujarat, India, to transact the following business: ORDINARY BUSINESS 1. To receive, consider and adopt the Standalone and Consolidated Financial Statements as at 31st March, 2019 including the Audited Balance Sheet as at 31st March, 2019, the Statement of Profit and Loss for the year ended on that date and reports of the Board of Directors and Auditors thereon. 2. To confirm the payment of interim dividend on equity shares already paid during the financial year ended st31 March, 2019 and to declare final dividend on equity shares for the said financial year. The Board of Directors at its meeting held on 30th January, 2019 had declared the interim dividend of ` 13.00 per equity share of fully paid up face value of ` 5.00 each and in its meeting held on 20th May, 2019 recommended final dividend of ` 4.00 per equity share of fully paid up face value of ` 5.00 each for the financial year ended 31st March, 2019. 3. To appoint a Director in place of Shri Samir Mehta (holding DIN 00061903), Director, who retires by rotation, and being eligible, offers himself for re-appointment. SPECIAL BUSINESS 4. To consider and if thought fit, to pass the following resolution as an Ordinary Resolution: RATIFICATION OF REMUNERATION OF COST AUDITORS OF THE COMPANY FOR THE YEAR 2019-20 “ RESOLVED THAT pursuant to provisions of Section 148(3) of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014 (including any statutory modification(s) or re-enactment thereof, for the time being in force) (“the Act”) and the approval by the Board of Directors at their meeting dated 20th May, 2019, the consent of the Company be and is hereby accorded for ratification of the below remuneration to M/s. Kirit Mehta & Co., Cost Accountants as the Cost Auditors of the Company for the financial year 2019-20: ` 8,00,000/- plus out of pocket expenses & GST as applicable to conduct the audit of the cost accounting records for all the manufacturing facilities of the Company.” 5. To consider and if thought fit, to pass the following resolution as a Special Resolution: RE-APPOINTMENT OF SHRI SAMIR MEHTA AS EXECUTIVE CHAIRMAN AND FIXATION OF REMUNERATION “ RESOLVED THAT pursuant to the provisions of Sections 196, 197, 203 and Schedule V and other applicable provisions, if any, of the Companies Act, 2013 and the rules made thereunder and Regulation 17(1B) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and subject to the provisions of Section 152(6) of the Companies Act, 2013 and any other applicable laws (including any statutory modification(s) or re-enactment thereof, for the time being in force) and any other approval as may be required, the consent of the Company be and is hereby accorded for re-appointment of Shri Samir Mehta (holding DIN 00061903) as Executive Chairman of the Company with effect from 30th July, 2019 till 31st March, 2020 on the following terms and conditions: 1. COMMISSION : At a rate such that the total remuneration does not exceed percentage limit of net profits of the Company as specified in the Companies Act, 2013, calculated in accordance with Section 198, subject to the overall ceiling prescribed under Section 197 read with Section I of Part II of Schedule V of the Companies Act, 2013 (including any statutory modification(s) or re-enactment thereof, for the time being in force). 3 2. PERQUISITES : shall be allowed in addition as under: A. (i) The Company shall reimburse annual fees for two clubs. (ii) The Company shall pay the premium on personal accident insurance policy as per the Company rules. (iii) The Company shall pay the premium on medical insurance for self and family as per the Company rules. B. (i) The Company shall provide a car with driver for official and personal use. (ii) The Company shall provide telephones at his residence, the cost of which will be borne by the Company. 3. OTHER TERMS : (i) Such appointment shall not be considered as a break in his service as managerial personnel of the Company. (ii) The total remuneration for any year shall not exceed percentage limit of net profits of the Company as specified in the Companies Act, 2013, calculated in accordance with Section 198, subject to the overall ceiling prescribed under Section 197 read with Section I of Part II of Schedule V of the Companies Act, 2013 as existing or modified or re-enacted. (iii) He shall not be entitled to receive sitting fees for attending meetings of the Board of Directors or a committee thereof. " “RESOLVED FURTHER THAT Shri Samir Mehta shall exercise substantial powers of management subject to superintendence, control and direction of the Board of Directors of the Company.” “ RESOLVED FURTHER THAT in the event of loss or inadequacy of profit in any financial year, the Company shall pay Shri Samir Mehta, in respect of such financial year, remuneration by way of salary, allowances, perquisites and other benefits as the Board of Directors may deem fit, subject to the limits prescribed in Section II of Part II of Schedule V of the Companies Act, 2013 (including any statutory modification(s) or re-enactment thereof, for the time being in force).” “ RESOLVED FURTHER THAT the Board of Directors or any Committee thereof specifically authorized for this purpose be and is hereby authorised to decide the amount of Commission to be paid to Shri Samir Mehta and the periodicity of such payment, subject to the overall limit as specified above, notwithstanding the limits stated in the Regulation 17(6)(e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (including any statutory modification(s) or re-enactment thereof, for the time being in force).” 6. To consider and if thought fit, to pass the following resolution as a Special Resolution: PAYMENT OF COMMISSION TO SHRI SUDHIR MEHTA, CHAIRMAN EMERITUS FOR THE YEAR 2018-19 “ RESOLVED THAT pursuant to Regulation 17(6)(ca) and other applicable provisions, if any, of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (including any statutory modification(s) or re-enactment thereof, for the time being in force) and other applicable provisions, if any, of the Companies Act, 2013 and pursuant to the approval of the shareholders of the Company at the 42nd Annual General Meeting of the Company, the consent of the Company be and is hereby accorded for payment of Commission