Dear Members,
Your Directors are pleased to present the 31st Annual Report
on the business and operations of the Company along with the Audited Annual Financial
Statements and the Auditors Report thereon for the Financial Year ended 31st
March, 2020. The financial highlights for the year under review are given below:
1. FINANCIAL HIGHLIGHTS
Financial Results are presented in the table below: (Rs. In Lakhs)
| Particulars |
Standalone
Financials Highlights |
Consolidate
Financials Highights |
|
2019-20 |
2018-19 |
2019-20 |
2018-19 |
| Total Revenue |
1,470.47 |
2,765.78 |
1,470.47 |
2,765.78 |
| Total Expenditure |
7,268.70 |
8,825.75 |
7,268.88 |
8,825.84 |
| Profit & Loss Before Exceptional item |
(5,798.23) |
(6,059.97) |
(5,798.41) |
(6,060.55) |
| Exceptional Item |
0.00 |
0.00 |
0.00 |
0.00 |
| Profit & Loss Before Tax |
(5,798.23) |
(6,059.97) |
(5,798.41) |
(6,060.55) |
| Tax Expenses |
(1,125.45) |
(1,096.21) |
(1,125.45) |
(1,096.21) |
| Profit & Loss After Tax |
(4,672.78) |
(4,963.76) |
(4,672.96) |
(4964.34) |
The volatility and uncertainty in the economy continued during the
year. The net revenue of the Company decreases from Rs. 2,765.78 Lakhs to Rs. 1,470.47
Lakhs during the year.
2. COMPANYS OPERATING PERFORMANCE AND STATE AFFAIRS
The Companys state of affairs, operations review and future outlook
have been discussed and analyzed more in depth in the Management Discussion & Analysis
report (Annexure VII) forming part of this Boards report. The companys main business
segments are Agri Business comprising largely floriculture, Steel, and Chemicals, pharma
division comprising the manufacturing and trading. The companys subsidiary is in the
business of Pharma.
PHARMA DIVISION
Alchemist Pharma division is a strong vertical of Alchemist Group with
around 400 SKUs and promoted through a very strong committed field force. Pharma division
enjoys tremendous respect with the medical fraternity and covering a universe of around
2,000 Doctors and 30,000 retailers across the country. Alchemists Molecules have been
acknowledged with tremendous response at the market place. A detailed write up on the
pharma divisions is contained in the section on Management Discussion and Analysis
elsewhere in this report.
AGRI DIVISION
The company continued to mark its presence in business of Global Agri
Trade.
STEEL DIVISION
Steel business segment is consistently making achievement and the
production efforts are now supplemented by trading activity as well.
3. SHARE CAPITAL
The paid up Equity Share Capital is Rs.1355.98 Lakhs and paid up
Preference Share capital is 31.38 Lakhs as on March 31, 2020. During the year, there is no
change in the share capital of the Company.
4. DETAILS OF MATERIAL CHANGES FROM THE END OF THE FINANCIAL YEAR TILL
THE DATE OF THIS REPORT
Significant material changes and commitments have occurred after the
closure of the Financial Year 2019-20 till the date of this Report, which would affect the
financial position of your Company.
The rampant spread of COVID-19 outbreak, across borders and
geographies, has severely impacted almost the whole world and triggered significant
downside risks to the overall global economic outlook and India is no exception. Due to
the lockdown announced by the Government of India from 25th March, 2020, entire operations
of the Company came to a halt. The lockdowns and restrictions imposed on various
activities due to the pandemic have posed challenges to the businesses of your Company.
The moratorium on debts and interest payments have been a source of
support in otherwise severely impacted liquidity and operating cash flows. The Board
believes that it is difficult to predict any industry wide scenario for the immediate
short term and the Company expects to resume normal operations soon after lifting of
lockdown. Although there are uncertainties due to the pandemic, the Company is taking
several measures to mitigate the adverse impact by optimizing costs and continuously
realigning the cost and operating structures so as to sustain viable level.
5. DIVIDEND
Your Company has incurred loss during the year and hence Board of
Directors has not recommended any dividend during the year.
6. DEPOSITS
The Company has not accepted any deposits from the public during the
year under review.
7. DEPOSITORY SYSTEM
There are 630538 (4.65%) shares still in physical form and 12929262
(95.35%) are \in dematerialized form of the Companys total paid- up equity capital
representing 1,35,59,800 shares as on March 31, 2020.
In view of the numerous advantages offered by the Depository system,
members holding shares in physical mode are advised to avail of the facility of
dematerialization from either of the depositories.
With effect from 01st April, 2019, the request for transfer
of Equity shares of the company shall not be processed unless the securities are held in
dematerialised form with a Depository as per the amended regulation 40 of SEBI (LODR)
Regulations, 2015.
8. LISTING FEES AND ANNUAL CUSTODIAN CHARGES
The Shares of your Company are listed on Bombay Stock Exchange Limited
(BSE) and National Stock Exchange India Limited (NSE).The Listing fee for the financial
year 2019-20, has been paid to the Stock Exchanges.
9. _ SUBSIDIARY COMPANY & CONSOLIDATED FINANCIAL STATEMENTS
Your Company has one subsidiary company namely Alchemist Healthcare
Limited and one Associate i.e., Alchemist Medisphere Limited. Financial statements of the
above mentioned subsidiary and associate company are consolidated as per the requirements
of the Companies Act, 2013 accounting standards and accounting policies applicable to the
company.
Pursuant to Section 129(3) of the Act, a statement containing the
salient features of the financial statements of the subsidiary companies is attached to
the Directors Report in Form AOC-1 (attached as Annexure-I). The Company will make
available the said financial statements and related detailed information of the subsidiary
company upon the request by any member of the Company or its subsidiary company. These
financial statements will also be kept open for inspection by any Member at the Registered
Office of the Company. The Consolidated Financial Statements presented by the Company
include the financial statements of its subsidiary and associate companies.
The financial statements of one Associate i.e., ROC Foods Limited
(formerly known as Alchemist Foods Limited) is still under compilation process till the
date of balance sheet and one subsidiary viz. Alchemist Hospitality Group Limited is under
strike off. Accordingly, the same are not forming part of the consolidated financial
Statements.
10. DETAILS OF DIRECTORS AND KMP DIRECTORS
• Mr. Charandeep Singh Jolly (DIN: 05151343) who retires by
rotation at this meeting and being eligible has offered himself for reappointment, be and
is hereby re- appointed as a Non- Executive Director of the Company.
• In first term of office of Ms. Maria Fernandes as Independent
Director of the Company in terms of the Companies Act, 2013 expired on March 23, 2020.
Pursuant to the recommendation of the Nomination and Remuneration Committee and the Board
of Directors of the Company in their meeting which was held on June 11, 2020, Re- appoint
Ms. Maria Fernandes as Independent Director of the Company w.e.f March 23, 2020 and the
Board of Directors recommended to the shareholders for re-appointment of Ms. Maria
Fernandes as Independent Director of the Company for a period of 5 years at the Annual
General Meeting held on September 30, 2020.
KEY MANAGERIAL PERSONNEL
• Mr. Dinesh Kumar, Chief Financial Officer of the company had
resigned on July 02, 2019.
• The Board has appointed Mr. Anop Singh Negi as Chief Financial
officer of the Company with effect from July 11, 2019 in place of
Mr. Dinesh Kumar.
• The Board has appointed Mr. Sunil Jain as Company Secretary
& Compliance Officer he had resigned on November 15, 2019.
• The Board has appointed Ms. Divya Bajaj as company Secretary and
Compliance officer of the Company with effect from February 01, 2020 in place of Mr. Sunil
Jain.
11. DECLARATION BY INDEPENDENT DIRECTORS
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and
SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Also, your
Company has received annual declarations from all the Independent Directors of the Company
confirming that they have already registered their names with the data bank maintained by
the Indian Institute of Corporate Affairs ["IICA"] as prescribed by the Ministry
of Corporate Affairs under the relevant rules. The Board is of the opinion that all
independent directors of the Company hold highest standards of integrity and possess
requisite expertise and experience required to fulfill their duties as Independent
Directors.
12. SEPARATE MEETING OF INDEPENDENT DIRECTORS
In terms of requirements under Schedule IV of the Companies Act, 2013
and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate
meeting of the Independent Directors was held on February 12, 2020.
The Independent Directors at the meeting, inter alia, reviewed the
following:-
• Performance of Non-Independent Directors and Board as a whole.
• Performance of the Chairperson of the Company, taking into
account the views of Executive Directors and Non- Executive Directors.
• Assessed the quality, quantity and timeliness of flow of
information between the Company management and the Board that is necessary for the Board
to effectively and reasonably perform their duties.
13. BOARD MEETINGS AND COMMITTEESS MEETINGS
During the year, 07 Board meetings were convened and held.
During the Year, 05, Audit Committee meetings, 01 Stakeholders
Relationship Committee (SRC) meetings and 03 Nomination and Remuneration Committee
meetings were convened and held.
The details of these meetings are given in the Corporate Governance
Report. The intervening gap between any two meetings was within the period prescribed
under the Companies Act, 2013.
14. ANNUAL EVALUATION OF BOARD
Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing
Obligations and Disclosure Requirements) Regulations 2015 and having due regard to the
SEBIs Guidance Note on Board Evaluation dated January 05, 2017, the Board has carried out
an annual evaluation of its own performance, individual separately as well as the
evaluation of the working of its Audit Committee, Committee of Directors Stakeholders
Relationship Committee and Nomination and Remuneration Committee. A comprehensive
evaluation process formulated by the Nomination and Remuneration Committee covering
various aspects of the functioning of the Board was circulated to all the Directors to
evaluate the performance of the Board.
The performance evaluation of the Non-Independent Directors and the
Board as a whole was carried out by the Independent Directors. The performance evaluation
of the Chairperson of the Company was also carried out by the independent directors,
taking into account the views of the executive and non-executive directors. The Directors
expressed their satisfaction with the evaluation process.
15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186
Particulars of loans/ guarantee given and investments made are given in
the financial statements.
16. RELATED PARTY TRANSACTION
All the related party transactions are entered on arms length basis
and are in compliance with applicable provisions of the Act and SEBI (Listing Obligations
& Disclosure Requirements) Regulations 2015.
All related party transactions are presented to the Audit Committee and
the Board. Approval is obtained for the transactions which are foreseen and repetitive in
nature. A statement of all related party transactions is presented before the Audit
Committee periodically, specifying the nature, value and terms and conditions of the
transactions.
Related Party Transaction Policy as approved by the Board is uploaded
on Companys Website at the web link i.e.,http://www.alchemist. co.in/investors.html.
The details of the transactions with the Related Parties are provided
in the accompanying Financial Statements. None of the Directors has any pecuniary
relationships or transactions vis-a-vis the Company.
17. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
All possible measures have been undertaken successfully by your Company
to achieve the desired objective of energy conservation and technology absorption.
Particulars of Energy Conservation, Technology Absorption and Foreign Exchange Earnings
and Outgo required under the Companies (Accounts) Rules, 2014 is annexed as Annexure-II.
18. CORPORATE SOCIAL RESPONSIBILITY (CSR)
During the year under review, your Company does not fall under the
criteria prescribed under Section 135 (1) of the Companies Act, 2013 and other relevant
rules framed thereunder, hence the company is not required to constitute Corporate Social
Responsibility Committee (CSR Committee).
19. MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES
Details of Managerial remuneration required pursuant to Section 134 (3)
(q) and section 197(12) and Rule 5(1) & (2) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure-III.
20. PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of Insider
Trading with a view to regulate trading in securities by the Directors and designated
employees of the Company. The Code requires pre-clearance for dealing in the Companys
shares and prohibits the purchase or sale of Company shares by the Directors and the
designated employees while in possession of Unpublished Price Sensitive Information
(UPPSI) in relation to the Company and during the period when the Trading Window is
closed. The Board is responsible for implementation of the Code.
21. VIGIL MECHANISM / WHISTLE BLOWER POLICY
In order to ensure that the activities of the Company and its employees
are conducted in a fair and transparent manner by adoption of highest standards of
professionalism, honesty, integrity and ethical behaviour the company has adopted a Vigil
Mechanism Policy/ Whistle Blower policy.
22. BUSINESS RISK MANAGEMENT
Business risk evaluation and management is an ongoing process within
the Company. During the year under review, a detailed exercise on Risk Assessment and
Management was carried out covering the entire gamut of business operations and the Board
was informed of the same. The company has followed the principal of assessing the risk and
accordingly managing the business.
In todays challenging and competitive environment, strategies for
mitigating inherent risks in accomplishing the growth plans of the Company are imperative.
The common risks inter alia are: Regulations, competition, Business risk,Investments,
retention of talent and expansion of facilities. Business risk, inter-alia, further
includes financial risk, political risk, fidelity risk, legal risk. These risks are
assessed and steps as appropriate are taken to mitigate the same.
23. INTERNAL CONTROL SYSTEM
Details of internal control system and its adequacy are included in the
Management Discussion and Analysis Report, which forms part of this Report.
24. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT
WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
Your Company has in place a Prevention of Sexual Harassment policy in
line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention,
Prohibition and Redressal) Act, 2013. An Internal Complaints Committee has been set up to
redress complaints received regarding sexual harassment. All employees (permanent,
contractual, temporary, trainees) are covered under this policy. During the year
2019-2020, no complaints were received by the Company related to sexual harassment.
25. STATUTORY AUDITORS
Pursuant to the provisions of Section 139 of the Companies Act, 2013
and relevant rules framed thereunder, M/s. Anu & Associates, Chartered Accountants
(firm Registration No.019624N) were appointed as Statutory Auditors of the Company for a
term of five consecutive years, at 28th Annual General Meeting held in the year
2017, on such remuneration as may be recommended by the Audit Committee of the Board and
decided by the Board of Directors of the Company.
However, the requirement of ratification of appointment of Auditors has
been relinquished by the Ministry of Corporate Affairs.
26. EXPLANATION TO AUDITORS REMARKS
The Board has taken note of the Observations made by the Auditors in
their Report.
Reply to Auditors qualifications/observations-
(i) Regarding outstanding export receivable- the Company extends credit
from time to time as per market practices. In respect of export receivables amounting to ^
46,442.79 Lakhs, credit were extended for export sales in the normal course of the
business, however it apparently got stuck. Though the Company is regularly following up on
the same, has initiated legal recourse and is hopeful of recovering such amount, still
considering the principal of conservatism, the Company had made a provision for expected
credit loss @ 10% of the outstanding export receivables amounting to ^ 4,644.28 Lakhs and
has not recognized unrealised foreign exchange gain/loss on such export receivable and
related trade payable during the financial year 2019-20. Hence forth, the
Company shall not be accounting for the unrealised foreign exchange
loss on such export receivable and related trade payables and the same will only be
accounted for on actual realisation/payment". Cumulatively, the provision for
expected credit loss on such export receivables stands at ^ 9,288.56 Lakhs.
Such export receivables are outstanding for more than three years as at
the year-end date, provision @ 20% is made against such doubtful trade receivables. Since
the actual realisation of such doubtful export receivable cannot be ascertained, we are
unable to comment on the adequacy of the provision of excepted credit loss made by the
Company.
The loss to that extent is under stated, the effect however could not
be quantified.
Though, the Company admits that the export receivable is doubtful of
recovery and has made partial provision on such export receivable, still such export
receivable and related trade payable stand in the books, hence require recognition of
unrealised foreign exchange gain/loss as per the provisions of Ind AS 21, The Effects of
Changes in Foreign Exchange Rates. Accordingly, the loss is overstated by ^ 3,178.87 Lakhs
for the year ended 31st March, 2020 and accordingly the trade receivables and trade
payable are understated by ^ 4,329.75 Lakhs and ^ 1150.88 Lakhs respectively, as at the
year ended 31st March, 2020.
(ii) Regarding Working Capital Limits- The working capital limits of ^
350.00 Lakhs availed from Bank of India for the working capital requirements of the
pharmaceutical division has been classified as non-performing asset (herein referred to as
NPA) on 30th November, 2018. The outstanding as on the date of classification by the
bank as NPA was ^ 363.88 Lakhs. The Company has not recognised interest liability on such
loan from the day it has become NPA, in line with the practice followed by the respective
bank".
The Company has not made provision of interest due on the borrowings
from Bank of India, post the date the account was classified as non-performing assets by
the bank.
In the absence of the information on record, the consequential impact,
if any, on the standalone financial statements is not ascertainable.
(iii) Regarding Capital Advances- Capital advances of Rs. 769.70 lakhs
is considered as good and recoverable and also states that out of the same, the Parent is
pursuing legal action in Honorable Kolkata High Court against Medisphere Marketing Limited
for recovery of the amount of Rs.459.80 Lakhs outstanding in its books. Further, the
company is hopeful of recovering the above amounts and hence no provision is considered
necessary.
(iv) Balances in FDRs, current account and cash credit limit- FDRs,
current accounts and cash credit limit with a cumulative debit balance of ^ 106.39 Lakhs
and cumulative credit balance of ^ 375.07 Lakhs could not be verified from statement or
even balance confirmation.
In the absence of the information on record, the consequential impact,
if any, on the standalone financial statements is not ascertainable.
(v) Consolidation of Financial Statements of Associate Company (ROC
Foods Limited), one subsidiary viz. Alchemist Hospitality Group Limited
It has been explained to us that the financial statements of one
associate, ROC Foods Limited is still under compilation and one subsidiary viz. Alchemist
Hospitality Group Limited is under strike off. Accordingly, the same are not forming part
of the consolidated financial results.
(vi) Impact of COVID-19-The financial impact arising out of the COVID
-19 outbreak are not accounted or reported or disclosed as per the prescribed Indian
Accounting Standards, in the financial statements.
In the absence of the information on record, the consequential impact,
if any, on the standalone financial statements is not ascertainable.
27. COST AUDITORS
Pursuant to the Section 148 of the Companies Act, 2013 and the rules
made thereunder, states that cost records are mandatory in the case following conditions
are satisfied -
(a) The company is engaged in manufacturing goods or provision of
services which are listed in Table A or Table B; and
(b) Total aggregate turnover of the company from all its production or
service is more than INR 35 Crore in the preceding financial year.
Your Companys turnover is less than 35 crores in the preceding
financial year. Hence, Section 148 of the Companies Act, 2013 is not applicable to your
Company.
28. SECRETARIAL STANDARDS SECREATRIAL AUDITORS
The Board of Directors confirms that your Company has complied with the
applicable Secretarial Standards during the year 2019-20.
The Board has appointed M/s Vishal Gambhir & Associates, Practicing
Company Secretaries to conduct Secretarial Audit for the Financial Year 2019-20. The
Secretarial Audit Report for the Financial Year ended 31stMarch, 2020 is
annexed herewith marked as Annexure- IV to this Report.
29. INTERNAL AUDITORS
The Company has appointed Mr. Amardeep Singh, as internal auditor
undertake the audit exercise. During the year, the Company continued to implement their
suggestions and recommendations to improve the control environment. This includes review
of processes for safeguarding the assets of the Company, review of operational efficiency,
effectiveness of systems and processes, and assessing the internal control strengths in
all areas. Internal Auditors findings are discussed with the process owners and suitable
corrective actions taken as per the directions of Audit Committee on an ongoing basis to
improve efficiency in operations.
30. DETAILS OF SIGNIFICANT & MATERIAL ORDERS PASSED BY THE
REGULATORS OR COURTS OR TRIBUNAL
During the Financial Year, no order has been passed by the authorities
which impacts the going concern status and companys operations in future.
31. HUMAN RESOURCES
Your Company treats its "Human Resources" as one of its most
important assets. The Company has taken pragmatic steps for strengthening organizational
competency through involvement and development of employees as well as installing
effective systems for improving the productivity, quality and accountability at functional
levels.
32. INDUSTRIAL RELATIONS
During the year under review, your Company enjoyed cordial relationship
with workers and employees at all levels.
33. INSURANCE
Your Company has taken reasonable steps to prevent risks and the Board
is kept apprised of the risk assessment and minimization procedure. The assets of the
Company have been adequately covered under insurance. The policy values have been enhanced
taking into consideration the expanded and upgraded facilities of the Company.
34. INFORMATION TECHNOLOGY
The Company continues to derive its business and service functions
through deployment of a strong Information Technology network across its offices,
verticals, outlets etc. to inculcate efficiency and discipline at all levels. The
employees information like personal data (personal information, qualification and
remuneration details etc.), employee data (current & past employment and training
details), self-task (attendance, leave and training request, IT declarations etc.) and MIS
continue to be coordinated through this System. The Management of the Company interacts
with the employees with regular thoughts and mails.
35. RESEARCH AND DEVELOPMENT
The Company continues to give significant attention to Research &
Development which has been providing significant support to the manufacturing capabilities
of the Company and has helped the company in expanding its product basket significantly.
This has also enabled the Company to become the most preferred source for its customers.
36. EXTRACT OF ANNUAL RETURN
As required pursuant to section 92(3) oftheCompaniesAct,2013 and rule
12(1) of the Companies (Management and Administration) Rules, 2014, an extract of annual
return in MGT 9 as a part of this Annual Report as ANNEXURE-V.
37. MANAGEMENT DISCUSSION & ANALYSIS
A detailed analysis of the Companys performance is discussed in the
Management Discussion and Analysis Report, which forms part of this Annual Report and
marked as Annexure-VI.
38. CORPORATE GOVERNANCE REPORT
As required by regulation 27(2) of SEBI (Listing Obligations and
Disclosure Requirements) Regulations, 2015, a detailed report of Corporate Governance as
well as Corporate Governance Compliance Certificate is included in the Annual Report and
marked as Annexure-VII.
39. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to clause (c) of sub-section (3) of Section 134 of the
Companies Act, 2013, the Directors confirm that:- in the preparation of the annual
accounts, the applicable accounting standards had been followed along with proper
explanation relating to material departures.
- accounting policies have been selected 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.
- proper and sufficient care has been taken 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
- the annual accounts have been prepared on a going concern basis; and;
- Internal financial controls followed by the company and those
internal financial controls are adequate and were operating effectively.
- proper systems have been devised to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively.
40. ACKNOWLEDGEMENT
Your Directors hereby express their appreciation for the cooperation
and assistance received from stakeholders, banks, valued clients and business associates.
Your Directors also wish to place on record their deep sense of appreciation for the
diligent support and efforts of the employees at all levels towards the operations and
growth of the Company.
For and on behalf of the Board of Directors ALCHEMIST LIMITED
|
Sd/- |
| Date: 04.09.2020 |
Bikram Bhattacharya |
| Place: New Delhi |
(Chairperson & WTD) |
|
DIN-03595530 |
+91-9892691696
