cian healthcare ltd share price Directors report


FOR THE FINANCIAL YEAR ENDED 31st MARCH, 2022

To

The Members / Shareholders,

The Board of Directors hereby present the 19th Annual Report of CIAN HEALTHCARE LIMITED (CIN: L24233PN2003PLC017563) together with the Audited Financial Statements for the financial year ended 31st March, 2022.

FINANCIAL HIGHLIGHTS

(Amount in Lakhs)

PARTICULARS 2021-22 (Standalone ) 2020-21 (Standalone) 2021-22 (Consolidated) 2020-21 (Consolidated)
Revenue from business operation Rs. 6,410.29 Rs. 7,238.27 Rs. 7787.03 Rs. 7,373.01
Other Income Rs. 47.06 Rs. 20.30 Rs. 53.62 Rs. 28.04
Total Income Rs. 6457.35 Rs. 7258.57 Rs. 7840.66 Rs. 7401.05
Operating profit before depreciation, Finance Cost, Exceptional Item and Tax (EBITDA) Rs. 533.15 Rs. 932.61 Rs. 471.32 Rs. 1186.24
Less: Depreciation & Amortization expenses Rs. 256.80 Rs. 245.15 Rs. 427.49 Rs. 345.27
Less: Finance Cost Rs. 513.87 Rs. 620.96 Rs. 644.15 Rs. 772.27
Profit before tax Rs. (237.52) Rs. 66.50 Rs. (600.32) Rs. 68.70
Less: Current Tax Expenses Rs. 0.00 Rs. 41.18 Rs. 0.00 Rs. 41.18
Less: Deferred Tax Expenses Rs. (9.94) Rs. (7.35) Rs. (46.96) Rs. 22.22
Net Profit for the year Rs. (227.58) Rs. 32.67 Rs. (553.35) Rs. 5.31
Add: Other Comprehensive Rs. 0.00 Rs. 0.00 Rs.0.00 Rs.0.00
Total Comprehensive Income Rs. 0.00 Rs. 0.00 Rs. 0.00 Rs. 0.00
Paid up equity share capital 2499.57 2336.08 2499.57 2336.08
EPS (Equity Shares of Rs. 10/- each) Basic & Diluted (in Rs.) (0.96) 0.14 (2.32) 0.02
Surplus brought forward from previous year Rs. 181.40 Rs. 148.74 Rs. (276.15) Rs. (281.45)
Balance available for appropriation Rs. (46.18) Rs. 181.41 Rs. (829.50) Rs. (276.15)

BUSINESS OVERVIEW:

The company is engaged in manufacturing of multiple lines- tablets, capsules, soft gels, liquid orals, ointments/ creams & sachets, cosmetics. Our portfolio comprises of gynecology, haematinic, cardio- diabetic, orthopedic, pediatric, derma-cosmetic, and antibiotic, CNS, vitamins & nutrient products.

Products are developed at our centralized R &D, staffed with world class professionals who are in constant pursuit to develop differentiated products.

The company is also exporting its product to various countries viz Afghanistan, Benin, Bhutan, Bolivia, Cambodia, Sri Lanka and also enhance its production capacity by installing additional machinery for manufacturing variety of products.

The Company also entering into new field of business of Manufacturing of Cosmetic products which is having huge market and demand in India.

PERFORMANCE REVIEW

Standalone:

Your Company delivered a solid all-round performance during the year under reviewed. In F.Y 2021-22, total revenue including other income stood at Rs. 6457.35 Lakhs against Rs. 7258.57 Lakhs in F.Y 2020-21.

Profit/(loss) before tax is Rs. (237.52) Lakhs as compared to profit of Rs. 66.50 Lakhs for the F.Y 2020-21. The Profit/(loss) after tax stood at Rs. (227.58) Lakhs as compared to profit of Rs. 32.67 Lakhs for the F.Y 2020-21.

Consolidated:

During the F.Y 2021-22 the Company and its Subsidiary Company Dr. Smith Biotic Private Limited revenue including other income stood at Rs. 7787.03 Lakhs as compared to Rs. 7401.05 in F.Y 2020-21.

The Profit/(Loss) before tax is Rs. (600.32) Lakhs as compared to Rs. 68.70 Lakhs for the F.Y 2020-21. The Profit/(Loss) after tax stood at Rs. (553.35) Lakhs as compared to Rs. 5.31 Lakhs for the F.Y 2020-21.

PERFORMANCE OF THE SUBSIDIARIES OF THE COMPANY

DR. SMITHS BIOTECH PRIVATE LIMITED

During the financial year 2021-22, Dr. Smiths Biotech Private Limited has reported a total income of INR 1617.42 Lakhs/- and incurred total expenditure of Rs. 1986.22/- Lakhs thus the Company suffered a total Loss before tax of INR 362.80 Lakhs/-. The Company still in its initial years of business development and setting its operations.

DIVIDEND

The Board of Directors of the company after holistically considering the financial position of the company and the future financial needs of the company have decided not to declare any dividend for the financial year ended March 31, 2022.

TRANSFER TO RESERVE:

The directors do not propose to transfer any amount to the General Reserve. The amounts of net profit are carried to reserve & surplus account of the Company.

CHANGE IN THE NATURE OF BUSINESS:

During the year, the Company has not changed its business or object and continue to be in the same line of business as per the main object of the Company.

SHARE CAPITAL:

The issued, subscribed and paid-up equity share capital of the Company as on 31st March, 2022 was Rs. 2499.57 Lakhs comprising of 24995764 equity shares of Rs. 10/- each.

During the year under review the Company has issued and allotted 1635000 fully paid-up equity shares of Rs. 10/- each at a premium of Rs.7 each, via preferential issue to non-promoters category.

MATERIAL CHANGES & COMMITEMENTS:

There were no material changes in the Company during the period under review.

BOARD OF DIRECTORS:

The composition of Board complies with the requirements of the Companies Act, 2013 ("Act"), except non-Executive director whose office was vacated due to casual vacancy. Further, in pursuance of Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015("Listing Regulations"),the Company is exempted from requirement of having composition of Board as per Regulation 17 of Listing Regulations.

None of the Directors of Board is a member of more than ten Committees or Chairman of more than five Committees across all the Public Companies in which they are Director. The necessary disclosures regarding Committee positions have been made by all the Directors.

None of the Director of the Company is serving as a Whole-Time Director in any Listed Company and is holding position of Independent Director in more than 3 Listed Company and none of the Director of the Company is holding position as Independent Director in more than 7 Listed Company.

None of the Directors of the Company is disqualified for appointed as Director as specified in Section 164 (2) of the Companies Act, 2013.

During the financial year under review there were changes in the constitution of the Board of Directors of the Company The strength of the Board of Directors on 31 March, 2022 was Three Directors as follows:

S.NO DIN Name of Director Date of Appointment Designation
1 01304850 Suraj Shriniwas Zanwar 07/01/2003 Managing Director
2 08466723 Santosh Shivaji Pimparkar 08/07/2019 Director
3 07984882 Damodarkumar Sharma 16.10.2021 Whole-time Director

During the financial year under review, following changes have occurred in the constitution of the Board of Directors of the Company:

S.NO DIN/PAN Name of Director Date of Appointment Designation
1 07984882 Damodarkumar Sharma 16.10.2021 Executive Director
2. 01786219 Dhiraj Shantilal Ostwal 23.06.2021 Non-Executive Director
3. 09225392 Ranjit Singh Marwah 30.06.2021 Executive Director
S.No DIN/PAN Name of Director Date of Resignation Designation
1. 08955278 Manoj Kumar Chunilal 01.06.2021 Non-Executive Director
2. 01786219 Dhiraj Shantilal Ostwal 30.09.2021 Non-Executive Director
3. 07578366 Riyaz Bashir Khan 16.10.2021 Executive Director
4 09225392 Ranjit Singh Marwah 25.11.2021 Executive Director
5 08202841 Shikha Rai 25.02.2022 Independent Director
6 06857879 Mohmmad Raees Shaikh 30.03.2022 Independent Director

MEETING OF THE BOARD OF DIRECTORS:

The Board meets at regular intervals to discuss and decide on Company / business policy and strategy apart from other Board business. The notice of Board meeting is given well in advance to all the-Directors.

During the financial year under report the Board of Directors of the company have duly met for 12 times, in respect of which meetings, proper notices were given, and the proceedings were properly recorded and signed in the minutes book maintained for purpose.

The meetings of the Board of Directors of the Company were held on:

S.No Date of Meeting Place of Meeting Board Strength Name of Director present at meeting
1 05.06.2021 Through Video Conferencing 3 • Suraj Shriniwas Zanwar • Shikha Rai • Riyaz Bashir Khan
2 30.06.2021 Through Video Conferencing 3 • Suraj Shriniwas Zanwar • Dhiraj Ostwal • Mohmmad Raees Shaikh
3 30.07.2021 Through Video Conferencing 5 • Suraj Shriniwas Zanwar • Dhiraj Ostwal • Mohmmad Raees Shaikh • Santosh Shivaji Pimparkar • Ranjit Singh Marwah
4 04.09.2021 Corporate Office 3 • Suraj Shriniwas Zanwar • Dhiraj Ostwal • Riyaz Bashir Khan
5 18.09.2021 Through Video Conferencing 3 • Ranjit Singh Marwah • Dhiraj Ostwal • Riyaz Bashir Khan
6 16.10.2021 Corporate Office 3 • Suraj Shriniwas Zanwar • Shikha Rai • Riyaz Bashir Khan
7 29.10.2021 Corporate Office 3 • Suraj Shriniwas Zanwar • Damodarkumar Sharma • Mohammad Raees Sheikh
8 17.11.2021 Corporate Office 4 • Suraj Shriniwas Zanwar • Damodarkumar Sharma • Mohammad Raees Sheikh • Santosh Pimparkar
9 23.11.2021 Corporate Office 3 • Suraj Shriniwas Zanwar • Damodarkumar Sharma • Mohammad Raees Sheikh
10 22.12.2021 Corporate Office 3 • Suraj Shriniwas Zanwar • Damodarkumar Sharma • Mohammad Raees Sheikh
11 28.12.2021 Corporate Office 3 • Suraj Shriniwas Zanwar • Damodarkumar Sharma • Mohammad Raees Sheikh •
12 21.02.2021 Corporate Office 3 • Suraj Shriniwas Zanwar • Damodarkumar Sharma • Santosh Pimparkar

INDEPENDENT DIRECTORS:

In terms of Section 149 of the Companies Act, 2013 and rules made there under, the Company has two Non-Promoter Non-Executive Independent Directors in line With the act. A separate meeting Of Independent Directors was held on 30.07.2021 to review the of Non-independent Directors and Board as whole and performance of the Company including assessment of quality, quantity and timeliness of flow of information between Company management and Board.

The Company has received necessary declaration from each director under Section 149(7) of the Act that they meet the criteria of independence laid down in Section 149 (6) of the act.

DIRECTOR AND KEY MANAGERIAL PERSONNEL

Following is the composition of the Board of Directors and Key Managerial Personnel of the Company as on 31st March 2022:

S.NO DIN Name of Director Date of Appointment Designation
1 01304850 Suraj Shriniwas Zanwar 07/01/2003 Managing Director
2 08466723 Santosh Shivaji Pimparkar 08/07/2019 Director
3 07984882 Damodarkumar Sharma 16.10.2021 Whole-time Director
4. CLTPD3486P Munjaji Purbhaji Dhumal 30.07.2021 Company Secretary
5. BCWPK1529B Riyaz Bashir Khan 12/06/2020 CFO

Based on the disclosures as provided by the directors or the Company in pursuance to the provisions of Section 164 of the Companies Act 2013, none of the Directors of the Company is found to be disqualified.

During the Financial Year Mr. Manoj Kumar Chunilal had tendered resignation w.e.f 01st June, 2021 and Mr. Dhiraj Shantilal Ostwal appointed as the Non-Executive Additional Directors of the Company w.e.f. 23rd June, 2021, thereafter Mr. Dhiraj Shantilal Ostwal was vacated his office due non regularization of his appointment by shareholders in the Annual general meeting dated 30th September, 2021 and Mr. Paresh Arun Shah was appointed as Non-Executive director w.e.f. 25th August, 2022.

During the Financial year under review, Mrs. Yashi Gupta, Company Secretary & Compliance Officer of the Company had tendered his resignation from the post w.e.f. 15th May, 2021. The Company in his place, appointed Mr. Munjaji Purbhaji Dhumal as Company Secretary & Compliance Officer of the Company w.e.f. 30th July, 2021.

During the Financial year under review, Mrs. Shikha Rai and Mr. Mohmmad Raees Shaikh, Independent Directors of the Company had tendered his resignation from the post w.e.f 25th February, 2022 and 30th March 2022 respectively. The Company in their place, appointed Mrs. Swati Maheshwari as Independent Director of the Company w.e.f. 30th May, 2022.

During the Financial year under review, Mr. Riyaz Bashir Khan and Mr. Ranjit Singh Marwah (appointed on 30.06.2021), Executive Directors of the Company had tendered his resignation from the post w.e.f 16th October, 2021 and 25th November 2021 respectively. The Company in their place, appointed Mr. Damodarkumar Sharma as Executive director w.e.f. 16th October, 2021.

PERFORMANCE 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.

• 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 member 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 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 aspect of his role.

Separate meeting of Independent Directors was held to evaluate the performance of nonindependent directors, performance of the board as a whole and performance of the chairman, taking into account the views of executive directors and non-executive directors. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated.

DIRECTOR RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors of the Company confirms that-

(a) In the preparation of the annual accounts for the year ended March 31, 2022, the Company has followed the applicable accounting standards and there are no material departures from the same;

(b) The Directors have 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 as at March 31, 2022 and of the profit and loss of the Company for that period;

(c) 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 for preventing and detecting fraud and other irregularities;

(d) The Directors have prepared the annual accounts on a ‘going concern basis;

(e) The Directors had laid down the internal financial Control and that internal financial Control are adequate and were operating effectively.

(f) 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.

COMMITTEE OF BOARD

As per the provision of the Companies Act, 2013 the Company has constituted following committees of the Board:

i. Audit Committee

ii. Nomination and Remuneration Committee

iii. Stakeholder Relationship Committee

iv. Corporate Social Responsibility Committee

AUDIT COMMITTEE:

The Board of Director has constituted Audit Committee as per the provision of Section 177 of the Companies Act, 2013.

The Composition of Audit Committee are as follows:

AUDIT COMMITTEE
NAME POSITION DESIGNATION
Mohammad Raees Sheikh* Chairman Independent Director
Suraj Shriniwas Zanwar Member Managing Director
Shikha Rai* Member Independent Director

*Mr. Mohmmed Raees Shaikh and Ms. Shikha Rai was resigned from the member of Audit Committee w.e.f 30th March 2022 and 25th February, 2022 respectively.

The meeting of Audit Committee was held on:

S.No Date of Meeting Name of Member present in the meeting
1 05.06.2021 • Mohammad Raees Sheikh • Suraj Shriniwas Zanwar • Shikha Rai
2 30.06.2021 • Mohammad Raees Sheikh • Suraj Shriniwas Zanwar
3 04.09.2021 • Suraj Shriniwas Zanwar • Shikha Rai

NOMINATION & REMUNERATION COMMITTEE

The Board of Director has constituted Nomination & Remuneration Committee as per the provision of Section 178 of the Companies Act, 2013.

The Composition Nomination & Remuneration Committee of are as follows:

NOMINATION & REMUNERATION COMMITTEE
NAME POSITION DESIGNATION
Mohammad Raees Sheikh* Chairman Independent Director
Dhiraj Shantilal Ostwal (w.e.f. 23.06.2021) Member Non-Executive Director
Manij Kumar Chunilal (till 01.06.2021) Member Non-Executive Director
Shikha Rai Member Independent Director

The Nomination and Remuneration Policy, as adopted by the Board of Directors, is placed on the website of the Company at www.cian.co and is annexed to this report as Annexure A

REMUNERATION TO DIRECTOR:

The details of remuneration/sitting fees paid during the financial year 2021-2022 to Executive Directors/ Directors of the Company is provided in Annual Return which available on the website of Company www.cian.co.

STAKEHOLDER RELATIONSHIP COMMITTEE:

The Board of Director has constituted Stakeholder Relationship Committee as per the provision of Section 178 of the Companies Act, 2013.

The Composition of Stakeholder Relationship Committee are as follows:

STAKEHOLDER RELATIONSHIP COMMITTEE
NAME POSITION DESIGNATION
Mohammad Raees Sheikh* Chairman Independent Director
Dhiraj Shantilal Ostwal (w.e.f. 23.06.2021)* Member Non-Executive Director
Manij Kumar Chunilal (till 01.06.2021) Member Non-Executive Director
Shikha Rai* Member Independent Director

*Mr. Mohmmed Raees Shaikh, Ms. Shikha Rai and Mr. Dhiraj Ostwal was resigned from the member of Stakeholder Relationship Committee w.e.f 30th March 2022, 25th February, 2022and 30th September, 2021 respectively.

The meeting of Stakeholder Relationship Committee was held on:

S.No Date of Meeting Name of Member present in the meeting
1 30.07.2021 • Mohammad Raees Sheikh • Dhiraj ostwal • Shikha Rai
2 04.09.2021 • Mohammad Raees Sheikh • Dhiraj Ostwal

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:

The Board of Director has constituted Corporate Social Responsibility Committee as per the provision of Section 135 of the Companies Act, 2013.

The Composition Corporate Social Responsibility Committee of are as follows:

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE
NAME POSITION DESIGNATION
Suraj Shriniwas Zanwar Chairman Managing Director
Dhiraj Shantilal Ostwal (w.e.f. 23.06.2021)* Member Non-Executive Director
Manij Kumar Chunilal (till 01.06.2021) Member Non-Executive Director
Shikha Rai Member Independent Director

*Ms. Shikha Rai and Mr. Dhiraj Ostwal was resigned from the member of Stakeholder Relationship Committee w.e.f 25th February, 2022and 30th September, 2021 respectively.

The meeting of Corporate Social Responsibility Committee was held on:

S.No Date of Meeting Name of Member present in the meeting
1 20.08.2021 • Suraj Shriniwas Zanwar • Dhiraj Ostwal
2 04.09.2021 • Suraj Shriniwas Zanwar • Dhiraj Ostwal

WHISTLE BLOWER POLICY:

In accordance with Section 177 of the Companies Act, 2013, the Company has adopted a Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The Company had established a mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud, or violation of our Code of Conduct and Ethics. The mechanism also provides for adequate safeguards against victimization of directors and employees who avail of the mechanism and also provide for direct access to the Chairman of the Audit Committee in the exceptional cases.

We affirm that during the financial year 2021-22, no employee or director was denied access to the Audit Committee.

DEPOSITS

In terms of the provisions of Sections 73 of the Act read with the Companie (Acceptance of Deposits) Rules. 2014, the Company has not accepted any deposits during the year under review and as such, no amount of principal or interest was outstanding as on 31st March, 2022.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS UNDER SECTION 186

The Company has invested in 22,00,000 equity shares of Rs. 10 each aggregating to Rs. 7,08,84,000 (Rupees Seven Crores Eight Lakhs Eighty-Four Thousand only) of DR. SMITHS BIOTECH PRIVATE LIMITED. No Loans and Guarantees covered under the provisions of Section 186 of the Companies Act, 2013 have been given by the Company.

ANNUAL RETURN

Annual Return extract is in the accordance with Section 92 sub-section (3) of the Companies Act, 2013 read With Rule No. 12(l) of the Companies (Management and Administration (Rules 2014) the copy of Annual Return has been placed on the website of Company www.cian.co. The Member may follow web link for the same https://cian.co/annualreport

RELATED PARTY TRANSACTIONS

During the financial year under review the Company has entered into the contract or arrangements Pursuance of the provisions of section 188(1) of the Companies Act 2013, the particulars of such transactions in prescribed Form No. AOC-2, has been annexed herewith as "Annexure B".

DIRECTORS REMUNERATION

The details of remuneration/sitting fees paid during the financial year 2021-22 to Executive Directors/Directors of the Company is provided in Annual Return which is available on the website of Company www.cian.co.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EARNING AND OUTGO:

As required under section 134(3Km) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, information relating to Conservation of Energy, Technology Absorption and Foreign Exchange Eaming and Outgo is as follows:

Conservation of Energy &Technology Absorption:

The Company is taking adequate steps to conserve the energy at all the levels and the Company is also implementing various measures for reduction in consumption of energy. The Disclosure of particulars with respect to Conservation of Energy has been attached herewith as in FORM A as "Annexure C". There is no technology absorption during the year under review.

Foreign Exchange Earning & Outgo:

(Amount in Lakhs)

PARTICULAR FY 2021-22 FY 2020-21
Foreign Exchange Earning 884.28 775.82
Foreign Exchange Outgo 0.00 0.00

In todays economic environment, Risk Management is a very important part of business. The Company is Exposed to inherent uncertainties owing to the sectors in-which it operates. A key factor in determining a companys capacity to create sustainable value is the risks that the company is willing to take (at strategic and operational levels) and its ability to manage them effectively. Many risks exist in a companys operating environment and they emerge on a regular basis. The Companys Risk Management processes focuses on ensuring that these risks are identified on a timely basis and addressed.

Your Company also has a Risk Management Frarmework in place covering all critical areas of operation. This framework is reviewed periodically keeping in mind the business dynamics and external environment and provides the guidelines for managing the various risks across the business.

The Process of Risk Management include following steps:

1) Risk Identification and Impact Assessment

2) Risk Evaluation

3) Risk Reporting and Disclosures

4) Risk Mitigating and Monitoring

INTERNAL FINANCIAL CONTROL

The Company has a proper and adequate system of internal controls. This ensures that all transactions are authorized, recorded and reported correctly, and assets are safeguarded and protected against loss from unauthorized use or disposition. In addition, there are operational controls and fraud risk controls, covering the entire spectrum of internal financial controls.

The Internal Auditor of the Company carries out review of the intemal control systems and procedures. The internal audit reports are reviewed by Board.

Your Company has also put in place adequate internal financial controls with reference to the financial statements commensurate with the size and nature of the Company. During the year, such controls were tested and no material discrepancy or weakness in the Companys internal controls over financial reporting was observed.

DISCLOSURE OF REMUNERATION

Pursuant to Section 197 of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, detail of ratio of the remuneration of each director to the median employees remuneration are appended to this report as "Annexure D"

There is no employee drawing remuneration of Rs. 8,50,000/- per month or Rs.1,02,00,000/- per year, therefore the particulars of employees as required u/s 197(12) of the Companies Act, 2013 read with Rule 5(2) and Rule (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are not applicable to the company.

Name of the top 10 employees in term of remuneration drawn in the financials year 202122:

A statement of Top-10 employees in terms of remuneration drawn as per rule 5(2) read with rule 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, is annexed with the report "Annexure E".

CORPORATE GOVERNANCE

Your Company strives to incorporate the appropriate standards for corporate governance. However, pursuant to Regulation 15(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Company is not required to mandatorily comply with the Provisions of certain regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and therefore the Company has not provided a separate report on Corporate Govemance, although few of the information are provided in this under relevant heading.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In. terms of Regulation 34, and Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a review of the performance of the Company, for the year under review, Management Discussion and Analysis Report, is presented in a separate section forming part of this Annual Report as "Annexure F"

AUDITORS

STATUTORY AUDITOR

M/s. Agarwal Mahesh K & Co., Chartered Accountants (FRN:008007C), were appointed as the Statutory Auditors of the Company in the Extra-Ordinary General Meeting (AGM) of the Company held for the year 2018-19, to hold office from the conclusion of the this Annual General Meeting of the Company till the conclusion of the Annual General Meeting to be held in the financial year 2023-24.

As required under Regulation 33(d) of the SEBI (LODR) Regulation, 2015 the Auditor has confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountant of India.

Board Considered the major observations given by the auditor and reply of management on the same as follows:

(i) According to the information and explanations given to us and in our opinion the cost records pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under subsection (1) of Section 148 of the Companies Act, 2013 needs to be maintained by the company as per the recommendation given by the Cost Auditor. -

Reply form Management: Company has process and systems to maintain the cost records. During the previous year due to COVID-19 situation there were unforeseen changes in the business world. Hence, as a business owner our priority was to run business and maintain the plant, which is being done and we have sustained in this difficult period.

Our maximum office staff was working from home and due to limitations of the availability of material transport and changed demand in products it was practically difficult to follow hundred percent process cost record. This is already being taken care by the management

(ii) According to the information and explanations given to us, the Company has delayed (defaulted) in repayment of loans and borrowings to banks and financial institution as on the balance sheet date of Rs.39.91 lakhs.

Reply form Management: Due to change in business condition, ballooning effect of EMIs, delayed payments by government and other customers company have faced working capital shortage during the previous year. But situation is improved and as of today the all-outstanding dues for the financial year 2021-2022 was paid by the Company.

(iii) According to information and explanation give to us and on the basic of our examination of the records of the Company, Company has been sanctioned working capital limit in excess of five crores rupees, in aggregate, from bank during the year. Below are the instances where value submitted to banks through quarterly/monthly statement is not in agreement with the books:

Quarter/Month ending Value as per Books of Accounts Value as per Quarterly/Monthly statement filled with Bank Difference
June 2021 293124779 93124779 0.00
30th September, 2021 276350109 296259455 -19909346
December 2021 323655585 323655585 0.00
March 2022 340168730 340202690 33960

Reply From Management: The discrepancies are on account of statements filed with the banks on 25th of September due to half year ending reporting.

(iv) According to the information and explanations given to us, no undisputed amounts payable in respect of Income tax, sales tax, value added tax, duty of customs, service tax, cess and other material statutory dues were in arrears as at 31 March 2022 for a period of more than six months from the date they became payable as on 31st March 2022 except one TDS under section 194Q of Rs.55854/- which has been paid post balance sheet date.

Reply From Management: Due to some technical reason the Company was not able to make the payment on time but which was paid immediately after due date.

(v) According to the information and explanations given to us and the records of the Company examined by us, there is a prior period income of Rs.1.08 lakhs that have been disclosed during the year in the tax assessments under the Income Tax Act, 1961 (43 of 1961).

Reply From Management: As Prior Period income of Rs. 1.08 Lakh. Resulted due to omission of income or expenses of prior period as below:

• Due to excess payable remuneration booked in earlier year of Rs 64737/-

• Due to short TDS & TCS Receivable booked in earlier year of Rs 43080/-

The Board of the Company take pleasure in stating that no other observation has been made by the Auditors in their report which needs any further explanation by the Board.

INTERNAL AUDITOR

As per section 138 of the Companies Act, 2013, the Company has appointed, internal auditors for conducting the internal audit for financial year 2021-22 as per the internal audit standards and regulations. The internal auditor reports their findings to the audit committee of the board. The audit function maintains its independence and objectivity while carrying out assignments. It evaluates on a continuous basis, the adequacy and effectiveness of internal control mechanism with interaction of KMP and functional staff.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Act read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2019 your Company has appointed DSM and Associates, practicing Company Secretaries firm, Mumbai to conduct the Secretarial Audit of the Company for the financial year 2021-22. The Secretarial Audit Report is annexed herewith as "Annexure G" to this Report. Further the board of directors propose to appoint M/s. DSM & Associates, Practicing Company Secretary having Certificate of Practice No. 9394 as Secretarial Auditor for Financial Year 2022-2023.

No observation has been made by the Secretarial Auditors in their report which needs any explanation by the Board.

COST AUDITOR

The company is trying to maintaining the Cost Records as specified by the Central Government under section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, and accordingly such accounts and records are made and maintained by the Company in full fledge form in near future as assured by the board. Further, the cost records are also audited by M/s Suraj Lahoti & Associates, Cost Auditors. The Company is in process to file the Cost Audit Report for the year 2021-22.

Your Directors had, on the recommendation of the Audit Committee, appointed M/s. Suraj Lahoti & Associates., Cost Auditors to audit the cost accounts of the Company for the financial year 2022-23 on a remuneration of Rs. 45,000/- (plus GST). As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members in General Meeting for their ratification. Accordingly, a resolution seeking Members ratification for the remuneration payable to M/s Suraj Lahoti & Associates., Cost Auditors is included at Item No. 6 of the Notice of the Annual General Meeting

DETAILS TN RESPECT OF FRAUDS REPORTED BY AUDITORS UNDER SECTION 143(12) OTHER THAN THOSE REPORTABLE TO THE CENTRAL GOVERNMENT

The Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Companies Act, 2013.

During the Financial Year, company has not received any cases regarding Fraud reporting required under Companies Amendment Act, 2015.

CREDIT RATING

The Credit Rating Agency Brickwork has awarded Credit rating of BWR D for long term Facilities and short term Facilities to the companys borrowings. Further the company is in process of taking new Credit rating report for 2021-22.

DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. The Policy aims to provide protection to employees at the work place and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure.

The Company has always provided a congenial atmosphere for work to all the employees that is free from discrimination and harassment including sexual harassment. It has provided equal opportunities of employment to all without regard to their caste, religion, color, marital status and sex.

The company is in process of constitution of Internal Complaints Committee as required under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has not received any complaint of sexual harassment during the financial year 2021-22.

GOING CONCERN STATUS

There is no significant or material order passed during the year by any regulator, court or tribunal impacting the going concern status of the Company or its future operation.

CORPORATE SOCIAL RESPONSIBILITY

According to Rule 3 (2) of The Companies (Corporate Social Responsibility Policy) Rules, 2014 Every company which ceases to be a company covered under subsection (1) of section 135 of the Act for three consecutive financial years shall not be required to —

a. constitute a CSR Committee; and

b. comply with the provisions contained in 1[sub-section (2) to (6)] of the said section till such time it meets the criteria specified in sub-section (1) of section 135, therefore for the in the financial year 2021-22 the Company has ceases to comply with the provisions regarding CSR.

The CSR unspent amount till financial year 2020-2021 was paid by Company in the financial year 2021-2022 as donation to a trust SHRI TILOK JAIN DNYAN PORASARAK MANDAL, PATHARDI AHMADNAGAR which is mainly involve in education activities and having a track record of CSR implementation from last 20 years.

SUBSIDIARIES, JOINT VENTURE OR ASSOCIATES

Companies which become to be Companys Subsidiary, Joint Venture or Associate Companies as per the provision of Companies Act, 2013 during the financial year 2021-22 as ‘Annexure H

S.No Name of Company Nature Percentage of Holding Section
1. Dr. Smith Biotech Private Limited Wholly Owned Subsidiary 99.99% 2(87)

MAINTENANCE OF COST RECORDS:

The Provision of section 148 of the Companies Act, 2013 with respect to the maintenance of cost records are applicable to the Company and company has maintained adequate record during the year under review.

COMPLIANCE WITH APPLICABLE SECRETARIAL STANDARDS

The Board of Director confirms that the secretarial standard, as applicable to the Company have been complied with.

MATERIAL ORDER BY TRIBUNAL OR OTHER REGULATORY BODY

There is no significant or material order passed during the year by any regulator, court or tribunal impacting the going concern status of the Company or its future operation.

ACKNOWLEDGEMENT

The Directors would like to express their sincere appreciation for the assistance and co-operation received from the banks, Government authorities and members during the year under review. The Directors also wish to place on record their deep sense of appreciation for the committed services by the Companys executives.

CAUTIONARY NOTE

The statements forming part of the Directors may contain certain forward looking remarks within the meaning of applicable provisions of the Companies Act, 2013 and rules made there under. Many factors could cause the actual results, performances or achievements of the company to be materially different from any future results, performances or achievements that may be expressed or implied by such forward looking statements. This Report should be read in conjuction with the financial statements included herein and the notes thereto.

BY THE ORDER OF BOARD OF DIRECTORS FOR CIANHEALTHCARE LIMITED
SD/- SD/- SD/-
Suraj Shriniwas Zanwar Santosh Pimparkar Munjaji Dhumal
(Managing Director) Director Company Secretary
DIN: 01304850 DIN: 08466723 M No.: A65852
Date: 03/09/2022
Place: Pune