Ipca Laboratories Ltd Directors Report.


Your Directors have pleasure in presenting the 71st Annual Report and Audited Financial Statements for the financial year ended 31st March, 2021.


(Rs. crores)

Rs. ( crores)



Year ended 31.3.2021 Year ended 31.3.2020 Year ended 31.3.2021 Year ended 31.3.2020
Sales and other Income 5201.40 4432.12 5482.83 4715.71
Profit before finance cost and depreciation 1575.82 979.45 1599.49 965.89
Less : Finance cost 8.14 15.79 9.04 16.50
Depreciation and Amortisation 187.72 178.69 209.17 210.50
Profit before tax 1379.96 784.97 1381.28 738.89
Less : Provision for taxation
Current Tax 244.98 137.98 248.65 140.59
Short / (Excess) provision of taxes for_earlier years - - (0.01) 0.52
Deferred Tax Asset (5.79) (5.47) (8.50) (5.78)
Net Profit 1140.77 652.46 1141.14 603.56


The Company does not propose to transfer any amount to the general reserve out of the amount available for appropriation.


The standalone and consolidated financial statements are prepared in accordance with the Indian Accounting Standards (Ind-AS) as prescribed under Section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.

In accordance with Indian Accounting Standard (Ind AS-110), the audited consolidated financial statements are also provided in the Annual Report.


During the year under report, CARE Ratings has re-affirmed CARE AA; Stable / Care A1 + (Double A; Outlook: Stable / A One Plus) ratings to the Company’s long term / short term bank facilities (fund based / non-fund based) amounting to Rs. 1140 crores.

CRISIL has re-affirmed ‘CRISIL A1+’ rating for Rs. 50 crores commercial paper programme of the Company.


The Covid-19 Pandemic has caused / continue to cause un-precedented disruption in the global economic activities. Several countries and central banks are implementing stimulus packages to revive their respective economies and GDP growth.

Several countries worldwide have implemented lockdowns and other containment measures to restrict the spread of coronavirus. The available healthcare resources and infrastructure facilities are also majorly devoted for Covid-19 treatment.

The coronavirus pandemic is a healthcare as well as economic crisis that has shaken the global economy and has forced countries across the globe to take measures to correct under-investment in the healthcare infrastructure. Going forward this pandemic will also change the way we operate. The consumer behavior and consumption pattern will also undergo changes.

Being manufacturers of pharmaceuticals and hence provider of essential services, the operations of the Company continued unabated albeit with challenges such as logistics, timely availability of raw materials and manpower shortages. The Company has initiated various measures at its facilities and continue to vigorously follow the guidelines issued by local authorities from time to time such as social distancing, masking, sanitization, etc.

The continued and uninterrupted manufacturing and supply of active pharmaceutical ingredients and dosage forms to our customers across the globe spanning over 100 countries in these testing times and most challenging conditions, have re-inforced the customer confidence in your Company.

Overall, there was no impact until now of the pandemic on the Company’s financial performance. In the financial year 2020-21, the domestic and emerging market branded formulations business got impacted due to lock-downs and lower patient footfall in the dispensaries, OPDs and hospitals. However, this got compensated by the growth in the generic and institutional formulations as well as Active Pharmaceutical Ingredients (APIs) business, especially of Hydroxychloroquine Sulphate and Chloroquine Phosphate, since these molecules were considered to be useful in the treatment of Covid-19 disease in the initial period of coronavirus outbreak.

There is no denying that we may face many more Covid-19 related uncertainties and challenges in days to come. However, your Company is confident that the inherent business model of the Company, which is to a great extent resilient to such market disturbances, will navigate the challenges which are ahead of us and that the ongoing covid-19 pandemic generally is not expected to negatively impact our capital and financial resources, assets, profitability and liquidity position.


a. Industry Structure and Development

The global pharmaceutical market is estimated to be about US$ 1.35 trillion and was hitherto growing at a CAGR of about 4%. However, it is to be seen how the Covid -19 pandemic, which has caused unprecedented economic disruption and has put tremendous pressure on healthcare system globally, will impact this industry going forward.

Though the pharmaceutical industry is developing at a rapid pace, this growth won’t come easily for the industry that is heavily influenced by healthcare reforms, cost pressure, economic and political fluidity, public demand for lower cost treatment, economic consolidation, increased competition and changing regulatory landscape with increased scrutiny.

The growth in the pharmaceutical industry globally is driven by ageing population as well as about 1% increase in the global population at the same time. Improvement in the purchasing power and increased access to healthcare system and medicines world over including emerging markets are also driving the growth. As population ages due to increasing life expectancy, people require pharmaceuticals to treat their chronic illness, thus increasing the demand for industry products.

Thanks to advances in science and technology, the research based pharmaceutical industry is entering an exciting new era in medicine development. The research methods are evolving and the innovative pharmaceutical industry aims to turn fundamental research into innovative treatments that are widely available and accessible to patients.

b. Outlook, Risks and Concerns

The Indian pharmaceuticals industry is globally respected and is one of the successful industries in the country. It has contributed significantly to the healthcare by ensuring quality, accessible and affordable generic medicines around the globe. It has also immensely contributed to India’s economic growth.

The low cost of production and R&D benefited the competitiveness of the Indian pharma industry in the international market. The Government of India has recently approved production linked incentives (PLI) Scheme for the pharmaceuticals sector which will further improve the competitiveness of the Indian Pharma Industry and will also attract additional investment in the sector. Indian pharmaceutical companies have also carved out a niche in both the Indian and world market with expertise in reverse engineering new processes for manufacturing of pharmaceuticals at low cost, which became the advantage for this industry. India is amongst the largest provider of generic drugs and vaccines globally and is known as the pharmacy of the world.

Although economic woes of certain geographies are impending the pharmaceutical market growth, the long term outlook for the industry remains positive. The industry growth is driven by ageing population and ever growing middle income group in emerging economies boosting demand for the pharmaceuticals. Additionally, the emergence of new viruses, the latest being SARS-CoV-2 and drug resistant infections, biological agents, immune therapies, etc. will spur research and development activities providing the industry with more products in their drug pipeline with revenue and growth streams.

The Indian pharmaceuticals market is the third largest in terms of volume. India is the biggest provider of generic medications globally and enjoys a strong position in the world pharmaceuticals sector. The country also has a huge talent pool and scientists having the capability to steer this industry forward to a much greater degree. The cost efficiency also continues to create opportunities for Indian pharmaceutical companies in the emerging global economies. The Indian pharmaceutical industry is expected to outperform the global pharmaceutical industry and grow in the next couple of years and thereby emerge as one of the top 10 pharmaceutical market globally by absolute value size.

Indian pharmaceutical companies are focusing on global generic and API business, R&D activities and contract research and manufacturing alliances. India is also fast emerging as a preferred pharmaceuticals manufacturing location. Increasing use of pharmaceutical generics in developed markets to reduce healthcare cost will also provide attractive growth opportunities to Indian generic formulations manufacturers and thus Indian pharmaceutical industry is poised for an accelerated growth in the coming years. However, poor public healthcare funding and infrastructure, low per capita consumption of medicines in developing and under developed countries including India, currency fluctuations, regulatory issues, government mandated price controls, inflation and resultant all round increase in input costs are few causes of concern.

During the year under report, there was no change in the nature of Company’s business.

c. Financial Performance and Operations Review

During the financial year under report, the Company registered on a standalone basis a total income of Rs. 5201.40 crores as against Rs. 4432.12 crores in the previous year, a growth of 17.36%. On a consolidated basis, the total income of the Company has increased by 16.27% to Rs. 5482.83 crores as against Rs. 4715.71 crores in the previous financial year.

During the financial year under report, the Earnings before interest, depreciation and taxation on a standalone basis amounted to Rs. 1575.82 crores as against Rs. 979.45 crores in the previous financial year. The operations have resulted in a net profit of Rs.1140.77 crores during the financial year under report as against Rs. 652.46 crores in the previous financial year, a growth of 74.84%.

On a consolidated basis, the Earnings before interest, depreciation and taxation amounted to Rs. 1599.49 crores as against Rs. 965.89 crores in the previous financial year. The consolidated operations have resulted in a net profit of Rs. 1141.14 crores during the financial year under report as against Rs. 603.56 crores in the previous financial year, a growth of 89.07%.

Break-up of Sales (standalone) (Rs. Crores)



Domestic Exports Total Growth Domestic Exports Total Growth
Formulations 1981.67 1597.19 3578.86 14% 1912.61 1221.55 3134.16 16%
APIs & Intermediates 386.33 1120.00 1506.33 28% 250.93 922.20 1173.13 33%
Total Sales 2368.00 2717.19 5085.19 18% 2163.54 2143.75 4307.29 20%
Growth 9% 27% 18% 17% 24% 20%

d. Key Financial Ratios (standalone)

31st March, 2021 31st March, 2020
1. Debtors Turnover Ratio 6.30 5.86
2. Inventory Turnover Ratio 2.77 3.11
3. Interest Coverage Ratio 188.51 62.91
4. Current Ratio 3.08 2.18
5. Debt Equity Ratio 0.03 0.11
6. Operating Profit Margin (%) 25.01% 17.19%
7. Net Profit Margin (%) 21.93% 14.72%
8. Return on Net Worth (%) 24.00% 17.74%

Due to increase in the sales and improvement in operational performance and efficiency, which has resulted into increased profitability, most of the above key financial ratios have improved substantially. e. International Business

The products of the Company are now exported to over 100 countries across the globe. During the financial year under report, the international business amounted to Rs. 2717.19 crores as against Rs. 2143.75 crores in the previous year, a growth of 27%. Formulation exports of the Company increased by 31% to Rs. 1597.19 crores and exports of APIs and Drug Intermediates increased by 21% to Rs. 1120.00 crores.

The Company’s formulations manufacturing sites at Silvassa and SEZ Indore and APIs manufacturing site at Ratlam continue to be under US FDA import alert.

The Company has implemented comprehensive remedial measures at all its manufacturing sites to ensure quality and regulatory compliances. These remedial measures included review of all processes and procedures, revamping of training system, recruitment of senior quality personnel as well as automation of quality control laboratories. The Company is committed to its philosophy of highest quality in manufacturing, operations, systems, integrity and cGMP culture. These manufacturing sites are awaiting re-inspection by US FDA.

Except US FDA import alert on three of its manufacturing sites, none of the Company’s manufacturing sites have any outstanding regulatory or compliance issues with any other regulatory agency.

Continent-wise Exports (Rs. Crores)



Continent Formulations APIs and ntermediates Total % to exports Formulations APIs and Intermediates Total % to exports
Europe 496.26 260.63 756.89 28% 390.95 244.53 635.48 30%
Africa 476.78 55.81 532.59 20% 308.93 34.00 342.93 16%
Americas 173.94 398.48 572.42 21% 119.56 312.20 431.76 20%
Asia 105.92 369.66 475.58 17% 76.87 309.64 386.51 18%
CIS 163.99 24.95 188.94 7% 167.33 17.16 184.49 9%
Australasia 180.30 10.47 190.77 7% 157.91 4.67 162.58 7%
Total 1597.19 1120.00 2717.19 100% 1221.55 922.20 2143.75 100%

Formulation Exports – Therapeutic Contribution

Therapeutic Group 2020-21 2019-20
Cardiovasculars & Anti-diabetics 23% 31%
Pain Management 28% 20%
Anti-malarials 26% 19%
Anti-bacterials 5% 6%
Anthelmintics 5% 8%
Central Nervous System (CNS) products 5% 6%
Gastro Intestinal (G.I) products 4% 4%
Cough Preparations 2% 2%
Others 2% 4%
TOTAL 100% 100%


The Company achieved European export sales of Rs. 756.89 crores during the financial year under report as against sales of Rs. 635.48 crores in the previous year, a growth of 19%.

The Company has developed and submitted 62 generic formulation dossiers for registration in Europe out of which 61 dossiers are registered. The Company has also obtained certificate of suitability (COS) of 47 APIs from European Directorate for Quality Medicines. The Company has started marketing generic formulations in the United Kingdom in its own label.


The Company achieved export sales of Rs. 532.59 crores to Africa during the financial year under report as against Rs. 342.93 crores in the previous year, a growth of 55%.

The Company exports branded and generic formulations as well as APIs to many African countries. The Company markets branded formulations in Africa through dedicated field force. The Company also supplies generics formulations to South Africa.

The Company is expanding its branded formulations business in this continent through expansion of geographical coverage and increase in the number of branded formulations marketed. The Company is also continuously filing new formulation dossiers for registration in the African countries.


The Company achieved sales of Rs. 572.42 crores in this continent as against Rs. 431.76 crores in the previous year, a growth of 33%. As reported earlier, the US formulations and APIs business continues to be impacted due to ongoing US FDA import alert for three of the Company’s manufacturing facilities.

46 ANDA applications of generic formulations developed by the Company are filed with US FDA out of which 18 ANDA applications are granted till date. 45 DMFs of the Company are also currently filed with US FDA.


The Asian business (excluding India) recorded sales of Rs. 475.58 crores as against Rs. 386.51 crores in the previous year, a growth of 23%. The Company exports formulations as well as APIs to several Asian countries. In countries like Nepal, Sri Lanka, Myanmar, Philippines and Vietnam, the Company markets its branded formulations through dedicated field force.

Confederation of Independent States (CIS)

The Company’s CIS business recorded sales of Rs. 188.94 crores as against Rs. 184.49 crores in the previous year, a growth of 2%. Most of the business is from branded formulation sales in Russia, Ukraine, Kazakhstan and Belarus. The Company’s branded formulations are marketed in this continent by its own field force appointed through its non-trading offices.


The Company exports APIs to Australia and formulations to Australia and New Zealand in this sub-continent. The business from this continent was Rs. 190.77 crores during the financial year under report as against Rs. 162.58 crores in the previous year, a growth of 17%. The Company has developed and submitted 75 generic formulation dossiers for registration in this market out of which 72 dossiers are registered.

f. Domestic Formulations Business

The Company’s branded formulations business in India now comprises of 16 marketing divisions focusing on key therapeutic segments with a portfolio of about 145 brands. Your Company is now the 19th largest in the domestic formulations market as per IQVIA - MAT March, 2021.

During the financial year under report, the domestic formulations business recorded a growth of 4% at Rs. 1981.67 crores as against Rs. 1912.61 crores in the previous year.

As a part of containment measures to restrict the spread of coronavirus, apart from lockdowns, the available healthcare resources and infrastructure facilities were also majorly devoted by the local administration across the country for Covid-19 treatment during most part of the financial year 2020-21. This resulted in reduced patient footfall in dispensaries, OPDs and hospitals for routine ailments as well as re-scheduling of non-critical surgeries which impacted prescriptions, launch of new products, field force activities and thus impacted business growth in the Domestic branded formulations market.

At the same time, the Company’s APIs and formulations business of Hydroxychloroquine Sulphate and Chloroquine Phosphate significantly improved in the financial year during the initial phase of Covid-19 outbreak since these molecules were then considered to be useful in the treatment of Covid-19 disease.

Domestic Branded Formulations - Therapeutic Contribution

Therapeutic segment 2020-21 2019-20
% to sales % to sales
Pain Management 52% 47%
Cardiovasculars & Anti-diabetics 19% 18%
Anti-malarials 4% 6%
Anti-bacterials 6% 8%
Dermatology 5% 5%
Gastro Intestinal (G I) products 3% 3%
Cough Preparations 3% 4%
Neuro Psychiatry 3% 3%
Urology 3% 3%
Neutraceuticals 1% 1%
Others 1% 2%
Total 100% 100%

g. Active Pharmaceutical Ingredients (APIs) and Intermediates Business

During the financial year under report, the APIs and Intermediates business recorded sales of Rs. 1506.33 crores as against Rs. 1173.13 crores in the previous financial year, a growth of 28.40%. Nearly 79% of the APIs and Intermediates business is from exports. As informed earlier, the APIs business of the Company during the financial year also benefited from the sales of APIs Hydroxychloroquine Sulphate and Chloroquine Phosphate, being molecules considered to be beneficial for the treatment of Covid-19 in the initial phase of its outbreak.

The Company exports its APIs across the globe. Most of the international customers of the Company are end user formulations manufacturers including several multinational companies.

Your Company is in the process of commercializing new APIs for the global market.

h. New APIs manufacturing unit at Dewas (M.P.)

The Company is in the process of setting up a new APIs manufacturing unit at Dewas (M.P.) with an initial capital outlay of about Rs. 250 crores. The land for this project has been acquired and the Company has already obtained all the necessary environmental approvals. Currently civil work for this project is ongoing at the site.

i. Intellectual Property Protection

The Company has created intellectual property management group within the Research and Development centers to deal with management and protection of intellectual property. The Company has filed many patent applications till date in India, USA and other countries. These applications relate to novel and innovative manufacturing processes for the manufacture of APIs and pharmaceutical formulations.

j. Internal Control Systems and its adequacy

The Company has adequate internal control systems including suitable monitoring procedures commensurate with its size and the nature of the business. The internal control systems provide for all documented policies, guidelines, authorization and approval procedures. The Company has an internal audit department which carries out audits throughout the year. The statutory auditors while conducting the statutory audit, review and evaluate the internal controls and their observations are discussed with the Audit committee of the Board.

k. Human Resources

The human resource plays a vital role in the growth and success of an organization. The Company has maintained cordial and harmonious relations with employees across various locations.

During the year under review, various training and development workshops were conducted to improve the competency level of employees with an objective to improve the operational performance of individuals. The Company has built a competent team to handle challenging assignments. The Company strives to enhance the technical, work related and general skills of employees through dedicated training programs on a continuous basis.

The Company has 14574 permanent employees (including 729 overseas employees) as on 31st March, 2021 out of which 6987 employees are engaged in the marketing and distribution activities.

l. Cautionary Statement

Certain statement in the management discussion and analysis may be forward looking within the meaning of applicable securities law and regulations and actual results may differ materially from those expressed or implied. Factors that would make differences to Company’s operations include competition, price realization, currency fluctuations, regulatory issues, changes in government policies and regulations, tax regimes, economic development within India and the countries in which the Company conducts business and other incidental factors.


No material changes or commitments affecting the financial position of the Company have occurred between the end of the financial year to which financial statements in this report relate and the date of this report.


The paid-up share capital of the Company as at 31st March, 2021 was 12,68,52,109 equity shares of Rs. 2/- each aggregating to Rs. 25.37 crores.

During the financial year, pursuant to the approval of the shareholders at the Extra Ordinary General Meeting held on 24th October, 2019, in-principle approval received from the Stock Exchanges and pursuant to applications received from the allottees to convert the warrants allotted to them into equity shares, the Board of Directors of the Company at their meeting held on 2nd September, 2020 have allotted 5,00,000 Equity shares of Rs. 2/- each fully paid-up for cash at a price of Rs. 955/- per equity share, including a premium of Rs. 953/- per share, aggregating to Rs. 47.75 crores to members of the Promoters / Promoter Group of the Company. The proceeds from issue of these shares are utilized for the purposes for which the issue was made.


The Company has a scheme - Ipca Laboratories Ltd. Employees Stock Option Scheme – 2014 (ESOS) approved by the Board of Directors as well as Company’s shareholders. This ESOS is in compliance with SEBI (Share Based Employee Benefits) Regulations, 2014. There was no change made in this ESOS Scheme during the financial year under report.

However, currently there are no outstanding options issued under the Company’s ESOS.

The necessary disclosure pursuant to Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 is furnished on the website of the Company www.ipca.com (weblink http://www.ipca.com/pdf/ESOS2014.pdf).


There has been no material change in the nature of the business of the subsidiaries. The Company has no subsidiary which can be considered as material within the meaning of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In accordance with the provisions of Section 136(1) of the Companies Act, 2013, the following have been placed on the website of the Company www.ipca.com :

a) Annual Report of the Company containing therein its standalone and the consolidated financial statements; and

b) Audited annual accounts of each of the subsidiary companies.

As required, the financial data of the subsidiaries, joint venture and associate companies is furnished in the prescribed Form AOC-1 as an Annexure to the consolidated financial statements.

Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, the consolidated financial statements of the Company are attached.


The Company has always considered Research and Development (R&D) as crucial for the sustained growth of the Company. In the recent years, the Company has stepped-up investments in R&D to keep pace with the changing domestic and global scenario. The Company has R&D centers at Mumbai, Ratlam, Athal (Silvassa) and Ranu (Vadodara) are duly recognized by the Government of India, Ministry of Science and Technology, Department of Scientific & Industrial Research (DSIR). The R&D expenditure of the Company during the financial year was Rs. 126.67 crores (2.49% of the turnover) as against Rs. 101.04 crores (2.35% of the turnover) in the previous year.

With qualified and experienced research scientists and engineers manning the research and development activities, the Company has focused its thrust on new and innovative process and product development for the manufacture of APIs with non-infringing processes. Apart from development of new dosage forms and drug delivery systems, improvement in processes and yield as well as cost reduction are also focus areas.


Your directors have already announced and paid in the month of December 2020 an interim dividend of Rs. 8/- per share (400%) for the financial year under report. It is now not proposed to declare any further dividend for the financial year ended 31st March, 2021. The interim dividend paid for the financial year under report is in line with the Company’s dividend distribution policy which is placed on the Company’s website www.ipca.com.

The dividend amounting to Rs. 101.48 crores paid as interim dividend will be appropriated out of the profits for the year.


The Company has transferred to the Investors Education and Protection Fund (IEPF) all the unpaid dividend amounts required to be so transferred on or before the due date(s) for such transfer. The Company has also transferred to IEPF, such of the Company’s equity shares in respect of which the dividend declared has not been paid or claimed for seven consecutive years.

The details of the unpaid / unclaimed dividends for the last seven financial years are available on the website of the Company www.ipca.com.

The Company has appointed its Company Secretary as the nodal officer under the provisions of IEPF.


Mr. Premchand Godha and Mr. Prashant Godha retire by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for re-appointment. Mr. Prashant Godha is also proposed to be re-appointed as the Executive Director of the Company for a further period of 5 years with effect from 16th August, 2021.

Mr. Anand T. Kusre and Mr. Dev Parkash Yadava were re-appointed as Independent Directors for a second term of five consecutive years from 1st April, 2019 and Dr. (Mrs.) Manisha Premnath was re-appointed as Independent Director for a second term of five consecutive years from 21st September, 2019, through postal ballot on 27th March, 2019. The shareholders have also approved the appointment of Mr. Kamal Kishore Seth as an Independent Director for a period of 5 years from 29th March, 2019.

Mr. Anand Kusre, Mr. Dev Parkash Yadava, Dr. (Mrs.) Manisha Premnath and Mr. Kamal Kishore Seth, who are independent directors, have submitted declaration that each of them meets the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and SEBI (LODR) Regulations and there has been no change in the circumstances which may affect their status as independent directors during the year.

None of the directors of the Company are debarred from holding the office of Director by virtue of any SEBI order or order by any other competent authority.

In the opinion of the Board, the independent directors possess appropriate balance of skills, experience and knowledge, as required. A brief note on Directors retiring by rotation and eligible for re-appointment is furnished in the Report on Corporate Governance annexed herewith.


During the financial year under report, the following persons continue to be the Key Managerial Personnel of the Company:

Mr. Premchand Godha - Chairman & Managing Director/CEO
Mr. Ajit Kumar Jain - Joint Managing Director / CFO
Mr. Pranay Godha - Executive Director
Mr. Prashant Godha - Executive Director
Mr. Harish P. Kamath - Corporate Counsel & Company Secretary

There was no change in the Key Managerial Personnel during the financial year under report.


The Nomination and Remuneration Committee has laid down the criteria for Directors’ appointment and remuneration including criteria for determining qualification, positive attributes and independence of a Director. The following attributes/criteria for selection have been laid by the Board on the recommendation of the Committee: l the candidate should possess the positive attributes such as leadership, entrepreneurship, business advisor or such other attributes which in the opinion of the Committee are in the interest of the Company; l the candidate should be free from any disqualification as provided under Sections 164 and 167 of the Companies Act, 2013; l the candidate should meet the conditions of being independent as stipulated under the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, in case of appointment as an independent director; and l the candidate should possess appropriate educational qualification, skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, research, corporate governance, technical operations, infrastructure, medical, social service, professional teaching or such other areas or disciplines which are relevant for the Company’s business.


The Nomination and Remuneration Committee lays down the criteria for performance evaluation of independent directors, Board of Directors and Committees of the Board. The criteria for performance evaluation is based on the various parameters like attendance and participation at meetings of the Board and Committees thereof, contribution to strategic decision making, review of risk assessment and risk mitigation, review of financial statements, business performance and contribution to the enhancement of brand image of the Company. The Board has carried out evaluation of its own performance as well as that of the Committees of the Board and all the Directors. The annual evaluation was carried out in the following manner:

Performance evaluation of Performance evaluation performed by
1. Board and individual directors Board after seeking inputs from all directors
2. Board Committees Board seeking inputs from all committee members
3. Individual Directors Nomination and Remuneration committee
4. Non-independent directors, Board as a whole and the Chairman Separate meeting of independent directors after taking views from executive directors
5. Board, its Committees and individual Directors At the board meeting held after the meeting of the independent directors based on evaluation carried out as above.


All the independent directors of the Company have registered their names in the database maintained by the Indian Institute of Corporate Affairs, Manesar, Haryana. Those of the independent directors who are not otherwise exempted shall appear for the common proficiency test conducted by the said institute within the prescribed time.


The objective and broad framework of the Company’s Remuneration Policy is to consider and determine the remuneration based on the fundamental principles of payment for performance, for potential and for growth. The Remuneration Policy reflects on certain guiding principles of the Company such as aligning remuneration with the longer term interests of the Company and its shareholders, promoting a culture of meritocracy and creating a linkage to corporate and individual performance and emphasising on line expertise and market competitiveness so as to attract the best talent. It also ensures the effective recognition of performance and encourages a focus on achieving superior operational results. The Nomination and Remuneration Committee recommends the remuneration of Directors and Key Managerial Personnel which is approved by the Board of Directors, subject to the approval of shareholders, where necessary. The level and composition of remuneration shall be reasonable and sufficient to attract, retain and motivate the directors, key managerial personnel and other employees of the quality required to run the Company successfully. The relationship of remuneration to performance should be clear and meet appropriate performance benchmarks. The remuneration to directors, key managerial personnel and senior management personnel should also involve a balance between fixed and incentive pay reflecting short and long term performance objectives appropriate to the working of the Company and its goals. The Remuneration Policy is placed on the Company’s website www.ipca.com.

Information about elements of remuneration package of individual directors is provided in the Annual Return as provided under Section 92(3) of the Companies Act, 2013 which is placed on the website of the Company.


Details of the familiarisation programs for independent directors are disclosed on the website of the Company www.ipca.com.


This information has been furnished under Report on Corporate Governance, which is annexed.


Your Directors confirm:

i) that in the preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanation relating to material departures;

ii) that your 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 at the end of the financial year March 31, 2021 and of the profit of the Company for the financial year;

iii) that your Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) that your Directors have prepared the annual accounts on a going concern basis;

v) that your Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

vi) that your Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


As per the requirement of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has complied with the requirements of Corporate Governance in all material aspects.

A report on Corporate Governance (Annexure 1) together with a certificate of its compliance from a Practising Company Secretary, forms part of this report.


During the year under review, the Company has not accepted any fixed deposits and as such no amount of principal or interest on deposits from public was outstanding as on the date of the balance sheet.


Details of the Audit Committee along with its constitution and other details are provided in the Report on Corporate Governance.


M/s. G. M. Kapadia & Co., Chartered Accountants (Firm Registration No. 104767W) were appointed as the Statutory Auditors at the 67th Annual General Meeting (AGM) of the Company for a term of 5 (Five) years i.e. till the conclusion of 72nd AGM and this appointment was also ratified by the members of the Company at the 68th Annual General Meeting held on Thursday, 9th August, 2019.

The Auditors’ Report read with the notes to the accounts referred to therein are self-explanatory and therefore, do not call for any further comments. There are no qualifications, reservations or adverse remarks made by the Auditors.


Pursuant to the provisions of Section 148 of the Companies Act, 2013, M/s. ABK & Associates, Cost Accountants (Firm Registration No. 000036) were appointed as the Cost Auditors to conduct audit of cost records of the Company for the financial year 2020-21.

The Cost Audit Report for the financial year 2019-20, which was due to be filed with the Ministry of Corporate Affairs by 8th September, 2020 was filed on 7th September, 2020.

The Company has maintained the cost accounts and cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013.


Pursuant to the provisions of Section 204 and other applicable provisions, if any, of the Companies Act, 2013, M/s. Parikh & Associates, Practising Company Secretaries were appointed as the Secretarial Auditors for auditing the secretarial records maintained by the Company for the financial year 2020-21.

The Secretarial Auditors’ Report is annexed hereto. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditors.


The Company is committed to good corporate citizenship. As a part of its corporate social responsibility, the Company continues to undertake a range of activities including healthcare and education to improve living conditions of the needy people. The CSR policy of the Company is placed on the website of the Company (http://www.ipca.com/pdf/corporate_policy/Corporate_Social_ Responsibility_Policy.pdf).

During the year under report, the Company has also supported healthcare and educational projects undertaken by charitable institutions and organizations.

In May 2021, your Company has facilitated the district administration in setting up within the premises of its upcoming bulk drugs manufacturing unit at Dewas, Madhya Pradesh, a 50,000 sq. ft. 250 bedded covid care centre including oxygen beds with in-house oxygen generation plant. This is apart from various other initiatives undertaken by the Company for covid care including distribution of oxygen concentrators, PPE Kits and medicines.

In accordance with the provisions of Section 135 of the Companies Act, 2013, an abstract on Company’s CSR activities is furnished as Annexure 2 to this report.


The Company considers safety, environment and health as the management responsibility. Regular employee training programmes are carried out in the manufacturing facilities on safety, environment and health.


The Company has not given any loans or guarantees or made any investments in contravention of the provisions of the Section 186 of the Companies Act, 2013. The details of the loans and guarantees given and investments made by the Company are provided in the notes to the financial statements.


All related party transactions that were entered into during the financial year were on arm’s length basis and were in the ordinary course of Company’s business. The Company has not entered into any contract, arrangement or transaction with any related party which could be considered as material as defined under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

The Board has approved a policy for related party transactions which has been uploaded on the website of the Company. (https://www.ipca.com/wp-content/pdf/corporate-policy/Policy_on_Related_Party_Transactions.pdf ).

All the related party transactions are placed before the Audit Committee as well as the Board for approval on a quarterly basis. Omnibus approval was also obtained from the Audit Committee and the Board on an annual basis for repetitive transactions.

Related party transactions under Indian Accounting Standard – Ind AS 24 are disclosed in the notes to the financial statements. Prescribed Form No. AOC-2 pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014 is furnished as Annexure 3 to this report.


Pursuant to the provisions of Section 197 of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration and other details as set out in the said Rules is furnished under Annexure 4 to this report.

However, having regard to the provisions of the first proviso to Section 136(1) of the Act and as advised, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the registered office of the Company during working hours excluding Saturdays and any member interested in obtaining such information may write to the Company Secretary and the same will be furnished on request. The full Annual Report including the aforesaid information is available on the Company’s website www.ipca.com.


The Board has laid down a code of conduct for board members and senior management personnel of the Company. The code also incorporates the duties of independent directors as laid down in the Companies Act, 2013. The said code of conduct is posted on Company’s website www.ipca.com. The Board members and senior management personnel have affirmed compliance with the said code of conduct. A declaration in this regard signed by the Chairman & Managing Director / CEO is given at the end of the Corporate Governance Report.


There is a Whistle Blower Policy in the Company and that no personnel have been denied access to the Chairman of the Audit Committee. The policy provides for adequate safeguards against victimization of persons who use vigil mechanism. The Whistle Blower Policy is posted on the website of the Company www.ipca.com.


The Company has also adopted a code of conduct for prevention of insider trading. All the Directors, senior management employees and other employees who have access to the unpublished price sensitive information of the Company are governed by this code. During the year under Report, there has been due compliance with the said code of conduct for prevention of insider trading. The Board has adopted a revised Code of Prevention of Insider Trading based on the SEBI (Prohibition of Insider Trading) Regulations, 2015. The same has been placed on the website of the Company www.ipca.com.


The Company has adopted a policy in line with the requirements of Prevention of Sexual Harassment of Women at the Workplace and a Committee has been set-up to redress sexual harassment complaints received. The necessary annual report has been submitted to the competent authority in this regard.


Pursuant to the provisions of Section 134 of the Companies Act, 2013, the Company has constituted a Risk Management Committee. The details of the Committee and its terms of reference are provided in the Report on Corporate Governance, which is annexed.


There are no significant or material orders passed by any regulator, tribunal or court that would impact the going concern status of the Company and its future operations.


In accordance with the requirements of Section 134 of the Companies Act, 2013, statement showing particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo is furnished as Annexure 5 to this report.


In accordance with the requirements of Section 92 (3) of the Companies Act, 2013 and rule 12 (1) of the Companies (Management and Administration) Rules, 2014, copy of Annual Return in Form MGT-7 is placed on the Company’s website www.ipca.com (weblink : https://www.ipca.com/wp-content/pdf/financials/annual-return/Annual-Return-FY-2020-21.pdf ).


The Business Responsibility Report of the Company for the financial year ended 31st March, 2021 forms part of this Report. The same is also uploaded on the Company’s website www.ipca.com as a part of the Annual Report.


The Company has complied with all the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.


Your Directors place on record their appreciation for the continued co-operation and support extended to the Company by the bankers and financial institutions. Your Directors also thank the medical profession, the trade and consumers for their patronage of the Company’s products. Your Directors also place on record their profound admiration and sincere appreciation of the continued hard work put in by employees at all levels.

For and on behalf of the Board
Mumbai Premchand Godha
28th May, 2021 Chairman & Managing Director