Lasa Supergenerics Ltd Management Discussions.
Forward looking statement
Statements in this management discussion and analysis of financial condition and results of operations of the company describing the companys objectives, expectations or predictions may be forward looking within the meaning of applicable securities laws and regulations. Forward looking statements are based on certain assumptions and expectations of future events.
The company cannot guarantee that these assumptions and expectations are accurate or will be realized. The company assumes no responsibility to publicly amend, modify or revise forward looking statements, on the basis of any subsequent developments, information or events. Actual results may differ materially from those expressed in the statement. Important factors that could influence the companys operations include changes in government regulations, tax laws, economic developments within the country and such other factors globally.
Lasa supergenerics limited (lasa) is a vertically integrated group spanning the entire veterinary, animal and human healthcare value chainfrom discovery-to-delivery, with established credentials in research, manufacturing and global marketing.
The company is a veterinary api manufacturing entity, which was acquired in april 2012. The manufacturing facility is located at mahad & chiplun, maharashtra. It specialises in catalyst chemistry and manufactures anthelmintic / veterinary api products with largest production capabilities and product categories in india. The company exports apis to counties like australia, bangladesh, middle east, china, turkey, egypt, jordan, korea, pakistan etc.
To efficiently control the supply chain, the company is fully backward integrated for its key moleculesfrom discovery research up to full-scale bulk production.
The companys marketing footprint is entrenched across developing markets in multiple countries. Similarly, the group expects to augment its export footprint significantly in width and depth in the future.
The company has alliances with leading indian and global animal health care conglomerates and uses good manufacturing practice (gmp) and world-class technologies in its operations. The company is managed by a consortium of technocrats, including its chairman and managing director dr. Omkar p. Herlekar who are impelled by passion and propelled by niche innovation. Our leadership team, which is guided by these values, is well positioned to lead into the future
The company is determined to achieve its goal of becoming a leading force in the niche animal health care solutions. The objective on which it was founded have always inspired sustainable growth through innovation in the last four years, and shall continue to do so in times to come.
Today, lasa supergenerics ltd. Is the leading manufacturer player in veterinary apis in india.
The company is listed entity on national stock exchange of india & bombay stock exchange (bse: 540702 & nse: lasa).
The global veterinary industry is making rapid strides across the globe, ripe with potent possibilities on the back of a pronounced tech-enablement of products and services, penetrating r & d initiatives of industry players and potent market inroads into hitherto untapped regions of the world, especially the developing economies.
Veterinary r&d is reasonably predictable and cost effective, as most animal health drugs originate from human health or crop protection products. This industry is predominantly branded generic in nature, as patented products comprise less than 20% of total market offerings, and most corporate players are typically subsidiaries of pharma majors that are focused on human healthcare. Notably enough, even the fringe players have grown at higher than industry rates.
Hitherto, animal health manufacturing was stationed in and focused on domestic shores in most countries, but today pharma heavyweights are increasingly exploring outsourcing options to rationalise production costs and benefit from lower overheads. This presents a humungous opportunity to indian companies to become leading global sourcing hubs equipped with compliant facilities.
One of the most visible, recent changes in the animal health industry is the financial sectors acknowledgement of animal health as an attractive investment opportunity. While it was once standard for animal health businesses to be integrated into much larger human health parent companies, animal health companies capable of operating successfully as stand-alone entities have been fast emerging in recent times. This move garnered significant interest from the investment community and raised the profile of the animal health industry to broader markets. The mounting demand of high- quality meat and milk, rampant disease outbreaks and growing affinity and concern for companion animals have provided a big boost to the veterinary industry across the globe.
Vaccination has now emerged as one of the most used medical products, protecting animals and livestock from various diseases irrespective of whether these animals are domestic or wild. These vaccinations not only help in preventing diseases but also in minimising the use of antimicrobials. Increased demand in emerging global markets, coupled with a relatively low risk of developing health products, make the animal health industry a lucrative investment opportunity. The trend is dominated by the increasing importance of poultry and livestock animals. Apart from the population explosion, rising income levels and increasing urbanisation, there is an ascent in the global demand for meat, especially in the developing countries. Another factor contributing to the bright prospects of the industry is the upsurge in the number of pets and increasing awareness about animal health among people. Asia-pacific is one of the major producers of animal meat and estimated to be the fastest- growing region during the forecast period.
Global industry snapshot
Since time immemorial, animals have helped humans in innumerable ways: whether through service and companionship or as nutriments for strength and sustenance. Over time, they
Have become an integral part of laboratory research settings for studying and combating diseases through targeted drug therapies. Every human interaction with pets has invariably led to some or the other form of animal health care practice, although veterinarians as we know them today did not emerge until the 20th century. Today, veterinary medicine and animal health care focus on the provision of health care, surgery, and preventive services for a variety of animal species. Veterinarians and veterinary technicians address health emergencies and
Provide routine medical care. They help combat famine caused by livestock diseases and control zoonotic disease-induced pandemics through vaccination programs.
On average, the world spends only about one-fortieth of the amount it devotes to human medicines on animal medicines. The time, care and investment put into the research and development of animal medicines ensures a steady stream of new and innovative products that improve the health and well- being of all these animals.
Risk & concerns
1. The veterinary api manufacturing of the company includes domestic and international business exposures. If governmental regulations affecting our business change, we may need to incur additional cost to comply with the required regulatory changes.
There may be additional cost for complying with government regulations since our business units are supplying veterinary api products in the regulated markets in the various developed countries. There are stringent requirements and audit mechanism regulating the manufacturing, research & development, testing and safety of api products on an on-going basis. There may be changes in the regulations
Regulating our existing and future products, and we shall have to comply with the changed regulations from time to time. The time frame in obtaining required clearances from regulatory authorities in india or from any other country cannot be predicted. Our veterinary api products require extensive quality control, trials, several stringent purity testing and government approvals before we can market these products, globally. All these uncertainties may affect operations of the business of our company.
The operating results of the company will depend upon the ability to successfully develop and license out the new products being developed through various r&d activities. We must develop, test and manufacture new products, which must meet stringent regulatory standards and receive requisite regulatory approvals. The decisions by regulatory authorities regarding whether and when to approve our api products, the speediness of regulatory authorizations, pricing approvals and product launches may be achieved and competitive developments could affect the availability or commercial potential of our products. The development and commercialization process is complex, time consuming and costly.
2. The veterinary api manufacturing of the company includes research &development activities. The research & development activities involve high risk as the costs are certain and the result uncertain.
The research & development activities will have high risk & high return compared to manufacturing and marketing of api products. The resource requirements in the r&d activities also can be difficult to predict. However, given the right resource base and focus, the r& d activities offer strong potential. Delays in any part of the r&d activity, our inability to obtain necessary regulatory approvals for our products or failure of a product to be successful at any stage and therefore not realized could harm our operating results.
3. If we are unable to comply with the conditions of our licenses and approvals, our licenses may be cancelled resulting in an adverse effect on our business.
In respect of the veterinary api manufacturing business, the de-merged company has obtained licenses from several regulatory authorities for the operations of its business. There are a number of conditions in these licenses, which require us to comply with. Any non-compliance may result in the cancellation of relevant licenses, which may adversely affect our api manufacturing business.
4. If we fail to comply with laws relating to environment, employees, health & safety, and other regulations that standardize manufacturing activities, research & clinical trials or face litigation related to any of these, our costs may increase and our gross margin and pat may decrease.
The veterinary api manufacturing undertaking transferred to the company includes manufacturing of niche anthelmintic apis, r&d, trials etc. There are stringent regulatory requirements relating to environment, employees, health & safety etc. Hence, we may incur substantial cost in order to comply with various requirements of environmental laws and regulations. In addition, we may discover unfamiliar environmental problems or conditions. We are subject to significant national and state environmental laws and regulations, which govern the discharge, emission, storage, handling and disposal of a variety of hazardous chemical substances that may be used in or result from our manufacturing operations.
Environmental laws and regulations are not as extensive in india as they are in other countries such as the united states of america and europe. They have, however, been increasing in stringency and it is possible that they will become significantly more stringent in the future. We are also subject to laws and regulations governing relationships with employees in various areas as minimum wage and maximum working hours, overtime, working conditions, hiring and terminating of employees, contract labour and work permits. Furthermore, the success of our business is contingent upon, among other things, receipt of all required licences, permits and authorisations, including local land use permits, building and zoning permits, environmental, health and safety permits.
Changes or concessions required by regulatory authorities could also involve significant costs and delay or prevent completion of the construction or opening or operations of expansions, renewals of existing facilities. In case of any injury or life of any worker in case of any clinical trial conducted by us, we may be required to compensate the worker for the same. Even when in case of any injury or loss of life of any worker during manufacturing or any clinical trial conducted by us due to the fault of the worker and not our fault or due to medical aid administration, we may be sued for compensation by the worker or the family members for the same. Even when in case of any injury or loss of life of any worker while manufacturing or trial conducted by the contractor due to the fault of the contractor and not our fault or due to medical aid administration, we may be sued for compensation by the worker or the family members for the same. The insurance taken may not sufficient to cover damages in case injury or loss of life.
+ performance review
The financial statements are prepared under historical cost convention, on accrual basis of accounting, and in accordance with the provisions of the companies act, 2013 (the act) and comply with the accounting standards notified under section 133 of the act read with the companies (accounting standards) rules, 2015. The management of the company has used estimates and judgments relating to the financial statements on a prudent and reasonable basis, in order that the financial statements reflect in a true and fair manner, the state of affairs and profit for the year.
The following discussions on our financial condition and result of operations should be read together with our audited consolidated financial statements and the notes to these statements included in the annual report. Unless otherwise specified or the context otherwise requires, all references herein to "we", "us", "our", "your company", "the company","lasa","lasa supergenerics ltd." are to lasa supergenerics ltd.
Standalone financial overview
The performance of the company for the financial year ended march 31, 2019, is as follows: financial highlights:
Amount (Rs in lakhs)
|As at year end||March 31,2019||March 31,2018|
|Income from operations||16957.30||24,583.88|
|Profit/ (loss) before depreciation, interest and tax||1522.69||4474.34|
|Profit/ (loss) before interest and tax||(408.16)||2657.68|
|Less: financial charges||1202.12||1,134.35|
|Profit/ (loss) before extraordinary items & tax||(1610.28)||1523.33|
|Less: exceptional items||-||-|
|Add excess depreciation due to change in depreciation method from wdv to slm.||-||-|
|Less: (excess)/ short tax provision||60.95|
|Less: provision for taxation||-||316.33|
|Add : deferred tax income / (expenditure)||(468.17)||(26.99)|
|Profit / (loss) after tax||(1203.06)||1233.99|
|Add: prior period income /(expenditure) (net)||-||-|
|Add: other comprehensive income||(1.25)||(1.42)|
|Profit / (loss) for the year||(1204.31)||1232.58|
Note: figures of previous years have been regrouped / reclassified wherever necessary to confirm this periods classification.
The total revenue from operations for the year ended march 31, 2019 was 16957.30 lakhs as compared to 24,583.88 lakhs, for the year under review, your company has reported earnings before interest, depreciation and tax of 1522.69 lakhs, compared to 4474.34 lakhs in the previous year, top line and margins of the company are relatively lower due to unfavorable price of raw materials and other factors which are in phase of improvement.
The companys exports has been increased from 473.20 lakhs. In fy 2017 - 18 to 1947.15 lakh. In fy 2018-19.
Report on corporate governance [pursuant to the sebi (listing obligations and disclosure requirements) regulations, 2015]
Companys philosophy on the code of governance
Effective corporate governance practices constitute the strong foundation for the company. The company philosophy on corporate governance oversees business strategies and ensures fiscal accountability, ethical corporate behavior and fairness to all stakeholders comprising regulators, employees, customers, vendors, investors and society at large.
The company has a strong legacy of fair, transparent and ethical governance practices.
The company has adopted a code of conduct for its employees including the managing director and the executive directors. In addition, the company has adopted a code of conduct for its non-executive directors which includes code of conduct for independent directors which suitably incorporates the duties of independent directors as laid down in the companies act, 2013 ("the act").
The company is in compliance with the requirements stipulated under regulation 17 to 27 read with schedule v and clauses (b) to (i) of subregulation (2) of regulation 46 of securities and exchange board of india (listing obligations and disclosure requirements) regulations, 2015 ("sebi listing regulations"), as applicable, with regard to corporate governance.
A. Board of directors
I. As on march 31, 2019, the company has 7 directors. Out of the seven directors, three are executive directors and four are independent directors (including woman independent director). Detailed profile of directors is available on our website www.lasalabs.com . The composition of the board is in conformity with regulation 17 of the sebi listing regulations read with section 149 of the companies act 2013.
Ii. None of the directors on the board holds directorships in more than ten public companies. None of the independent
Directors serves as an independent director in more than seven listed entities. Necessary disclosures regarding committee positions in other public companies as on march 31, 2019 have been made by the directors. None of the directors are related to each other.
Iii. Independent directors are non-executive directors as defined under regulation 16(1)(b) of the sebi listing regulations read with section 149(6) of the companies act along with rules framed thereunder. Based on the declarations received from the independent directors, the board of directors has confirmed that they meet the criteria of independence as mentioned under regulation 16(1)(b) of the sebi listing regulations and that they are independent of the management.
Iv. The names and categories of the directors on the board, their attendance at board meetings held during the year under review and at the last annual general meeting ("agm"), name of other listed entities in which the director is a director and the number of directorships and committee chairmanships / memberships held by them in other public limited companies as on march 31, 2019 are given herein below.
Other directorships do not include directorships of private limited companies, foreign companies and companies registered under section 8 of the act. Further, none of them is a member of more than ten committees or chairman of more than five committees across all the public companies in which he/she is a director. For the purpose of determination of limit of the board committees, chairpersonship and membership of the audit committee and stakeholders relationship committee has been considered as per regulation 26(1)(b) of sebi listing regulations.
|Name of director||Category #||No. Of Directorship(s) (excluding the company)||
No. Of committee membership (excluding the company)@
|Attendance at last agm|
|Dr. Omkar pravin herlekar, chairman & managing director||P.d & e.d||1||Nil||Nil||7||7||Yes|
|Mr. Shivanand gajanan hegde, whole-time director||E.d||Nil||Nil||Nil||7||7||No|
|*mr. Sumant madhusudan kharasambale, whole-time director||E.d||Nil||Nil||Nil||7||3||No|
|**mr. Vishnu gupta||A.d/e.d||Nil||Nil||Nil||7||1||No|
|Mr. Mithun jadhav~ whole-time director||E.d||1||Nil||Nil||7||4||Yes|
|Mr. Hardesh tolani||Ined||Nil||Nil||Nil||7||7||Yes|
|Mr. Ajay sukhwani||Ined||Nil||Nil||Nil||7||7||Yes|
|Ms. Ekta gurnasinghani||Ined||Nil||Nil||Nil||7||7||No|
|Ms. Manali bhagtani||Ined||Nil||Nil||Nil||7||7||No|
# p.d - promoter director, e.d - executive director, n.e.d - nonexecutive director and i.n.e.d - independent non-executive director.
@ includes audit committee and the stakeholders relationship committee only
* mr. Sumant madhusudan kharasambale resigned from the board of our company on june 16, 2018.
**mr. Vishnu gupta was appointed as additional director in the capacity of whole-time director. His appointment was not ratified by shareholders vide the postal ballot result submitted by scrutinizer (amit r. Dadheech & associates) on may 15, 2018.
~ appoitment w.e.f. As a whle-time director and occupier of factories
During fy 2018-19, information as mentioned in part a of
Schedule ii of the sebi listing regulations, has been placed before
The board for its consideration.
Details of equity shares of the company held by the directors as
On march 31, 2019 are given below:
|Name of the director||No of shares held|
|Dr. Omkar p herlekar#||7909501*|
|Mr. Shivanand hegde||1*|
|Mr. Mithun jadhav||0|
#3,42,000 shares held by omkar herlekar in our company are under encumbrance with vivid finance and holdings private limited. Omkar herlekar has initiated criminal proceedings to recover 3, 42,000 shares that are wrongfully encumbered with vivid finance and holdings private limited.
*one equity share held as a nominee of omkar speciality chemicals limited.
The company has not issued any convertible instruments. Familiarization programme
During appointment all independent directors are made aware of their roles and responsibilities which are also specified in their formal letter of appointment with terms and conditions thereon. At the board and various committees meetings, independent directors are regularly being familiarized on the business model, operations, updates, changes, policies, new policies, process implementation of the company.
Details of familiarization programs for independent directors are available on the website of the company and can be accessed at www.lasalabs.com .
Separate independent directors meetings.
A separate meeting of independent directors of the company, without the attendance of non-independent directors and members of management, was held on april 06, 2019, as required under schedule iv to the act (code for independent directors) and regulation 25 of sebi listing regulations, 2015. The independent directors at the meeting evaluated:
4- performance of non-independent directors and the board
Of directors as a whole;
4 performance of the chairman of the company taking into account the views of the executive and non-executive directors;
4 quality, content and timelines of flow of information between the management and board that is necessary for the board to effectively and reasonably perform its duties.
All the independent directors were present throughout the meeting and mr. Hardesh tolani chaired the meeting. Their suggestions were discussed at the board meeting and are being implemented to ensure a more robust interaction at a board level.
Meetings of the board:
The board meets in executive session, at least 4 (four) times during a financial year, mostly at the quarterly intervals inter alia to review quarterly financial statements and other items on the agenda. Additional meetings are held, if deemed necessary, to conduct the business. 7 (seven) board meetings were held during the year and the gap between two meetings did not exceed 120 (one hundred and twenty) days. The requisite quorum was present for all the meetings. During the year 2018-19, information as mentioned in schedule ii part a of the sebi listing regulations, 2015, has been placed before the board for its consideration.
Board meeting held during the financial year 2018-19 are detailed below:
|Sr. Date of board no meeting||Board Strength||No. Of directors present|
nomination and remuneration committee
stakeholders relationship committee
corporate social responsibility committee other committees
fund raising committee
The board committees are represented by a judicious mix of executive and non-executive directors. The committees deliberate on the matters assigned or referred to them by the board or as mandated by the statutes. Recommendations of the committees are submitted to the board for boards decision. In the minutes of all committee meetings are circulated to the board members for noting.
The audit committee of the company is duly constitutes as per regulations 18 of the listing regulations read with the provisions of section 177 of the companies act, 2013. All the members of the audit committee are financially literate and capable of analyzing financial statements of the company.
Terms of reference: the audit committee of the company is constituted in line with the provisions of regulation 18 of sebi (lodr) regulations, 2015 read with section 177 of the act.
The terms of reference of the audit committee are broadly as under:
1. Oversight of the companys financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;
2. Recommend the appointment, remuneration and terms of appointment of auditors of the company;
3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
4. Reviewing, with the management, the annual financial statements and auditors report thereon before submission to the board for approval, with particular reference to:
> matters required to be included in the directors responsibility statement to be included in the boards report in terms of clause (c) of sub-section 3 of section 134 of the act.
> changes, if any, in accounting policies and practices and reasons for the same.
> major accounting entries involving estimates based on the exercise of judgment by management.
> significant adjustments made in the financial statements arising out of audit findings.
> compliance with listing and other legal requirements relating to financial statements.
> disclosure of any related party transactions.
> qualifications in the draft audit report.
5. Reviewing, with the management, the quarterly financial statements before submission to the board for approval.
6. Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and making appropriate recommendations to the board to take up steps in this matter;
7. Review and monitor the auditors independence and performance, and effectiveness of audit process;
8. Approval or any subsequent modification of transactions of the company with related parties;
9. Scrutiny of inter-corporate loans and investments;
10. Valuation of undertakings or assets of the company, wherever it is necessary;
11. Evaluation of internal financial controls and risk management systems;
12. Establish a vigil mechanism for director and employment to reports genuine concerns in such manner as may be prescribed;
13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit.
14. Discussion with internal auditors of any significant findings and follow up there on.
15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;
16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;
17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors.
18. To review the functioning of the whistle blower mechanism.
19. Approval of appointment of chief financial officer after assessing the qualifications, experience and background, etc. Of the candidate;
20. Carrying out any other function as is mentioned in the terms of reference of the audit committee.
21. Reviewing the utilization of loans and/ or advances from/ investment by the holding company in the subsidiary exceeding rupees 100 crore or 10% of the asset size of the subsidiary, whichever is lower including existing loans / advances / investments existing.
22. Management discussion and analysis of financial condition and results of operations;
23. Statement of significant related party transactions (as defined by the audit committee), submitted by management;
24. Management letters / letters of internal control weaknesses issued by the statutory auditors;
25. Internal audit reports relating to internal control weaknesses; and
26. The appointment, removal and terms of remuneration of the chief internal auditor shall be subject to review by the audit committee.
Composition and other details of audit committee:
As on march 31, 2019 the audit committee comprised of three
(3) members of which two (2) are independent directors and (1)
Is executive director:
In fy 2018-19, 5 audit committee meetings were held. The dates
Are as given below:
The details of composition of audit committee and attendance of each committee member are as follows:
|Sr name of members||Designation||
Particulars of attendance
|No.||In Committee||Number of meeting held||No. Of meetings attended by the member|
|1. Mr. Hardesh tolani||Chairman||5||5|
|2. Ms. Ekta gurnasinghani||Member||5||5|
|3. Dr. Omkar herlekar||Member||5||5|
In addition to the audit committee members, chief financial officer, heads of finance and accounts, internal auditors, cost auditors, statutory auditors and other executives are invited to the audit committee meetings, on need basis.
The company secretary of the company acts as the secretary of the committee.
Nomination & remuneration committee:
The nomination and remuneration committee is constituted in compliance with the requirements of regulation 19 of the sebi (listing obligation and disclosures requirements) regulation 2015 read with the provisions of section 178 of the companies act, 2013. The nomination and remuneration committee recommends the nomination of directors and carries out evaluation of performance of individual directors. Besides, it recommends remuneration policy for directors, key managerial personnel and the senior management of the company.
The nomination and remuneration committee of the company is constituted in line with the provisions of regulation 19 of sebi (listing obligation and disclosures requirements), read with section 178 of the act.
The broad terms of reference of the nomination and remuneration committee are as under:
Recommend to the board the set up and composition of the board and its committees, including:
A) the "formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the board of directors a policy relating to, the remuneration of the directors, key managerial personnel and other employees".
B) the committee will consider periodically reviewing the composition of the board with the objective of achieving an optimum balance of size, skills, independence, knowledge, age, gender and experience.
C) formulation of criteria for evaluation of performance of independent directors and the board of directors.
D) devising a policy on diversity of board of directors.
E) identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the board of directors their appointment and removal.
F) whether to extend or continue the term of appointment of the independent director, on the basis of the report of performance evaluation of independent directors.
G) recommend to the board, all remuneration, in whatever form, payable to senior management.
H) performing such other duties and responsibilities as may be consistent with the provisions of the committee charter.
As on march 31, 2019 the nomination and remuneration committee comprised of three (3) members of which all are independent directors:
In fy 2018-19, 2 nomination and remuneration committee meetings was held which details are given below;
The details of composition of nomination and remuneration committee and attendance of each committee member are as follows:
|Sr name of members||Designation||
Particulars of attendance
|No.||In committee||Number of meeting held||No. Of meetings attended by the member|
|1. Mr. Hardesh tolani||Chairman||2||2|
|2. Ms. Ekta Gurnasinghani||Member||2||2|
|3. Mr. Ajay sukhwani||Member||2||2|
The company secretary of the company acts as the secretary of the committee.
B. Matrix on skill set required to be processed by board of directors.
At lasa, we recognize the importance of having a board comprising of directors who have a range of experience, diverse point of view. This helps us create an effective and well-rounded board. The capabilities and experiences sought in our directors are outline here;
Has expertise with respect to the sector the organization operates in that is veterinary api and in other pharmaceuticals, drugs etc. Has an understanding of the big picture in the given and recognizes the development of industry segments, trends, emerging issues and opportunities.
Has expertise with respect to geography the organization operates in. They understand the macro-economic environment, consumer and trade in the geography and have the knowledge of the regulations, legislations in which business of the company operates in.
Has expertise with respect to business specific technologies such as in the field of r&d and manufacturing etc.
People & talent understanding
Has experience in human resource management such that they bring in a considered approach to the effective management of people in an organization.
Governance, finance & risk
Has an understanding of the law and application of corporate governance principles in a commercial enterprise of similar scale. Capability to provide inputs for strategic financial
Planning, assess financial statements and oversee budgets for the efficient use of resources. Ability to identify key risks for the business in a wide range of areas including legal and regulatory.
Diversity of perspective
Provides a diversity of views to the board that is valuable to manage our customer, consumer, employee, key stakeholder or shareholders.
C. Detailed reason for the resignation of an independent director
No independent director resigns before the expiry of his tenure during the financial year 2018-19.
> performance evaluation of the board, its committees and individual directors:
Pursuant to the provisions of the act and the sebi listing regulations, 2015 (as may be applicable), the nomination and remuneration committee and the board of directors (board) had carried out an annual evaluation of its own performance and that of its committees and individual directors.
The performance evaluation criteria were determined by the nomination and remuneration committee. A structured questionnaire was prepared by nomination and remuneration committee after taking into consideration the various aspects such as participation at board/ committee meetings, board functioning, knowledge and skill, personal attributes, board composition and quality, board meetings and procedures, board strategy and risk management, board and management relations etc. The nomination and remuneration committee reviewed the performance of the board, its committees and of the directors. The performance of the board and individual directors was evaluated by the board seeking inputs from all the directors. The performance evaluation of the independent directors was carried out by the entire board, excluding the director being evaluated. The performances of the committees were evaluated by the board seeking inputs from the committee members.
Further, the independent directors had their separate meeting without the attendance of non-independent directors and members of management wherein they reviewed the performance of the board as whole, its chairman and nonexecutive directors and other items as stipulated under the act. Recommendations and suggested areas of improvement for the board, its various committees were considered by the board.
Remuneration of directors:
Nomination and remuneration policy:
Remuneration policy of the company is designed to create a high-performance culture. It enables the company to attract, retain and motivate employees to achieve results. Our business model promotes customer centricity and requires employee mobility to address project needs. The company pays remuneration by way of salary, benefits, perquisites and allowances (fixed component) and commission (variable component) to its managing director and the executive directors. Annual increments are recommended by the nomination and remuneration committee within the salary scale approved by the board and members and are effective april 1, each year.
The board of directors, on the recommendation of the nomination and remuneration committee, decides the commission payable to the managing director and the executive directors out of the profits for the financial year and within the ceilings prescribed under the act, based on the board evaluation process considering the criteria such as the performance of the company as well as that of the managing director and each executive director.
The company pays sitting fees of 15000 per meeting to its non-executive directors for attending meetings of the board and meetings of committees of the board.
Remuneration of directors:
Remuneration to non-executive/ independent director:
The non-executive directors of the company are entitled to sitting fees for attending the meetings of board of directors and committees thereof. Sitting fees paid to non-executive directors area within the prescribed limits under the companies act, 2013 and evaluated by the board of directors from time to time.
Reimbursement of expenses
The non-executive directors are also entitled to reimbursement of expenses for participation in the board and other meetings in terms of the companies act, 2013.
The details of sitting fees paid for the financial year 2018-19 are as under:
|Name of non-executive directors||Sitting fees paid (in lakhs)|
|Mr. Hardesh tolani||1.30|
|Mr. Ajay sukhwani||0.80|
|Ms. Ekta gurnasinghani||1.30|
|Ms. Manali bhagtani||0.70|
Remuneration to director, key managerial personnel and senior
1. Fixed pay: managing director, whole time director, executive director, key managerial personnel and senior management shall be eligible for a monthly remuneration as may be approved by the board on the recommendation of the committee in accordance with the statutory provisions of the companies act, 2013, and the rules made thereunder for the time being in force. The break-up of the pay scale and quantum of perquisites including, employers contribution to p.f, pension scheme, medical expenses, etc. Shall be decided and approved by the board on the recommendation of the committee and approved by the shareholders and central government, wherever required.
2. Minimum remuneration: if, in any financial year, the company has no profits or its profits are inadequate, the company shall pay remuneration to its managing director, whole time director or executive director in accordance with the provisions of schedule v of the companies act, 2013 and if it is not able to comply with such provisions, with the prior approval of the shareholder and central government.
3. Provisions for excess remuneration: if any managing director, whole time director or executive director draws or receives, directly or indirectly by way of remuneration any such sums in excess of the limits prescribed under the companies act, 2013 or without the prior sanction of the central government, where required, he/ she shall refund such sums to the company and until such sum is refunded, hold it in trust for the company. The company shall not waive recovery of such sum refundable to it unless permitted by the central government.
The details of remuneration paid to managing director and whole time directors are as under:
|Name of director||Designation||Salary & perquisites||Commission||Total remuneration|
|Dr. Omkar herlekar||Chairman & managing director||43.15||-||43.15|
|Mr. Shivanand hegde||Whole- time director||41.89||-||41.89|
|*mr. Sumant kharsamble||Whole-time director||1.70||-||1.70|
|**mr.vishnu gupta||Additional director||3.34||-||3.34|
|***mr.mithun jadhav||Whole-time director (factory occupier)||16.03||-||16.03|
*resigned w.e.f june 16, 2018
**appointment not ratified by shareholders vide postal ballot result dated may 15, 2018
*** appointed as additional director in the capacity of whole-time director and as occupier of all factories in board meeting held on august 13, 2018 and approved by shareholder in thrird agm.
Your company has no stock option plans and hence, such instrument does not form part of the remuneration package payable to any executive director and/ or non-executive director. The company does not have any policy for severance fees or any other payment to the directors. No pension will be paid by the company to any of the directors. Your company did not advance any loans to any of the executive and/ or non-executive directors during the period under review.
Stakeholders relationship committee:
The stakeholders relationship committee of the board was constituted in compliance with the provisions of section 178 of the companies act, 2013 and regulation 20 of the listing regulations. This committee deals with the stakeholder relations and grievances raised by the investors in a timely and effective manner and to the satisfaction of investors. The committee overseas performance of the registrar and share transfer agents of the company relating to investor services and recommends measures for improvement.
Ms. Nidhi kulshrestha is the compliance officer of the company pursuant to regulation 6 of the sebi lodr regulations.
Terms of reference:
The stakeholders relationship committee, inter alia, is primarily responsible for considering and resolving grievances of security holders of the company. The additional terms of reference of the stakeholders relationship committee are:
I) resolving the grievances of the security holders of the listed entity including complaints related to transfer/transmission of share, non-receipt of annual report, non-receipt of declared dividends, issue of new/duplicate certificates, general meetings etc.
Ii) review of measure taken for effective exercise of voting rights by shareholders.
Iii) review of adherence to the service standard adopted by the company in respect of various services being rendered by registrar & share transfer agent.
Iv) review of the various measures and initiative taken by the listed entity for reducing the quantum of unclaimed dividend and ensuring timely receipt of dividend warrant/ annual report/statutory notices by the shareholders of the company.
As on march 31, 2019, the stakeholders relationship committee comprised of three (3) members of which (1) is independent director and other (2) are executive directors.
The details of composition of stakeholders relationship committee are as follows:
|Sr no. Name of members||Designation in committee|
|1. Mr. Ajay sukhwani||Chairman|
|2. Mr. Shivanand hegde||Member|
|3. Mr. Sumant kharsambale*||Member|
|4. Mr. Mithun jadhav**||Member|
No complaints were received during fy 2018-19, hence no committee meeting was held during the period.
The company secretary of the company acts as the secretary of the committee.
*resigned w.e.f june 16, 2018 ** appointed w.e.f august 13, 2018
The board had reconstituted the composition of the stakeholders relationship committee pursuant to resignation of a member.
The securities exchange board of india has initiated a platform for redressing the investor grievances through scores, a web based complaints redressal system. The system processes complaints in a centralized web based mechanism. The company is in compliance with this system. Further, the company has periodically filed a statement detailing investor complaints with bse limited (bse) and the national stock exchange of india limited (nse).
Name, designation and address of the compliance officer:
Nidhi kulshrestha company secretary & compliance officer 1/301, shish mahal building, cabin road, bhayandar (east) - 401105 email: email@example.com / firstname.lastname@example.org
Corporate social responsibility (csr) committee:
Pursuant to provisions of sub- section 1 of section 135 of the companies act, 2013. The companies having net worth of inr 500 crore or more; or turnover of inr 1000 crore or more; or net profit of inr 5 crore or more during any financial year shall be required to constitute a corporate social responsibility committee of the board "hereinafter csr committee" with effect from 1st april, 2014.
The csr policy as approved by the board has been placed on the companys website and can be accessed at www.lasalabs.com
The corporate social responsibility (csr) committee of the board was constituted in compliance with the provisions of section 135 of the companies act 2013. The company is focused on value creation of communities by contributing to the social and environmental needs.
Terms of reference:
The purpose of the committee is to formulate csr policy of the company and monitor its implementation. Csr committee of the company is constituted in line with the provision of section 135 of the act. The board term of reference of csr committee is a follows:
The company communicates to the stock exchanges about the quarterly financial results within 30 minutes from the conclusion of the board meeting in which the same is approved. The results are usually published in business standard, free press journal, dainik lakshdeep (marathi) and nav shakti (marathi) having the wide circulation where in registered office of the company is situated.
The results are also placed on website of the company i.e. Www.lasalabs.com .
The official news releases and presentations to the institutional investors or analysts (if any) are disseminated to the stock exchanges at www.nseindia.com and www.bseindiacom and the same is being also uploaded on the website of the company www. Lasalabs.com.
Designated email address for investor services
To serve the investors better and as required under listing regulations, the designated email address for investors services email@example.com .
Dematerialization of shares and liquidity:
The companys shares are compulsorily traded in dematerialized form on nse and bse. Equity shares of the company are dematerialized as on march 31, 2019. Under the depository system, the international securities identification number (isin) allotted to the companys shares is ine670x01014.
Outstanding gdrs/adrs/warrants or any convertible instruments, conversion date and likely impact on equity:
The company has not issued any gdrs/adrs/warrants or any convertible instruments in the past and hence as on march 31,
2019 the company does not have any outstanding gdrs/adrs/ warrants or any convertible instruments.
General shareholder information:
A. Annual general meeting
Location and time of annual general meetings held in last three years
|For the year||Location||Date & time||Special Resolution Passed|
|2015 16||F-9, midc, badlapur (e), thane - 421503||Sept 24, 2016 at 4.00 pm||No|
|2016 17||H no 10/1, kedar coop hsg soc, shirgaon, kulgaon (e) - 421503||June 06, 2017 at 3.00 pm||Yes|
|2017 18||C-105, midc, Mahad, dist-raigad, maharashtra 402309||Sept 25, 2018 at 09:00 am||No|
B. Whether any special resolution passed last year through postal ballot - postal ballot was held during the year under review however no special resolutions were passed during fy 2018-19 through postal ballot.
C. Person who conducted the postal ballot exercise: scrutinizer, amit r. Dadheech & associates, company secretaries.
D. Whether any special resolution is proposed to be conducted through postal ballot- at present there is no proposal to pass any special resolution through postal ballot.
E. Financial year
April 01 to march 31.
F. Financial calendar
The company has announced/expects to announce the unaudited quarterly results for the year 2018-19 as per the following schedule:
|Board meetings for approval of||Tentative dates|
|Annual accounts for 2018-19 and financial results for 4th quarter for 2018-19||May 20, 2019|
|Financial results for 1st quarter 2019-20||August 12, 2019|
|Financial results for 2nd quarter 2019 -20||Before november 14, 2019|
|Financial results for 3rd quarter 201920||Before february 14, 2020|
|Annual accounts 2019-20||Before end of may, 2020|
G. Dividend payment date
Not applicable, since no dividend declared.
H. Listing on stock exchanges and address of stock exchange
|Segment||Isin no for nsdl/cdsl||Name of stock exchange & address of the stock exchange||Scrip code|
|25th floor, p. J. Towers, dalal street, mumbai 400 001.||540702|
|National stock exchange of india limited exchange||Lasa|
|Plaza, c-1, block g, bandra kurla complex bandra (east), mumbai 400 051|
I. Listing fees
Annual listing fees for fy 2019-20 have been paid to stock exchanges where the securities of the company are listed.
J. Market price data:
High, low (based on daily closing prices) and number of equity shares traded during each month in the year 2018-19 on nse and bse:
|Month||High price||Low price||High price||Low price|
Graphical presentation of movement of companys stock price as compared to nifty and sensex from april 2018 to march 2019 is as follows:
Stock price data bse (sensex)
Depositories of the company:
National securities depository limited 4th and 5th floor, a wing, trade world, kamala mills compound, lower parel, mumbai 400 013, india
|Tel.: +91 (22) 2499 4200|
|Fax: +91 (22) 2497 6351|
Central depository services (india) limited
Phiroze jeejeebhoy towers, 16th floor, dalal street, fort, mumbai 400 001, india.
|Tel.: +91 (22) 2272 3333|
|Fax: +91 (20) 2272 3199|
|Registrar and share transfer agent ("rta"):|
|Bigshare services private limited|
|1st floor, bharat tin works building, opp. Vasant oasis, makwana road, marol, andheri (east)|
|Mumbai - 400 059.|
|Tel: 022 62638200|
|Fax: 022 62638299|
Distribution of shareholding as on march 31, 2019:
|Shareholding of nominal||Number of shareholders||% to total||Shares||% to total|
Categories of shareholders:
Shares as on march 31, 2019
Shares as on march 31, 2018
|Promoter & promoters group#||7909500||34.59||8726171||38.16|
|Mutual funds & uti||0||0||0||0|
|Banks and financial institutions||0||0||395||0.0017|
|Foreign portfolio investors||0||0||161914||0.70|
Shares as on march 31, 2019
Shares as on march 31, 2018
|Bodies corporate & trusts||794757||3.48||1110140||4.85|
|Foreign nationals and nris||569879||2.49||560442||2.45|
# 342000 shares of mr. Omkar p. Herlekar were under encumbrance not yet received back in his account and hence, are not reflected in his beneficial positions and not considered above.
Statement showing shareholding more than 1% of the share capital as on march 31, 2019:
|Sr. No. Names of shareholders||Number of shares||Percentage of capital|
|1. Omkar pravin herlekar*||7909500||34.59|
|2. Vishanji sham dedhia||465000||2.03|
|3. Anil vishanji dedhia||260000||1.14|
Note: *342000 shares of mr. Omkar p. Herlekar were under encumbrance not yet received back in his account and hence are not reflected in his beneficial positions and not considered above
Dematerialization of shares and liquidity:
The companys equity shares have been dematerialised with the central depository services (india) limited (cdsl) and the national securities depository limited (nsdl). The international security identification number (isin) is an identification number for traded shares. This number is to be quoted in each transaction relating to the dematerialised shares of the company. The isin of the company for its shares is mentioned above. The company also periodically undertakes audit of share capital by practicing company secretary and submits the same with bse & nse.
The status of shares held in physical and dematerialized forms, as on march 31, 2019, are given below:
|Electronic form with nsdl||12175947||53.25|
|Electronic form with cdsl||10683896||46.73|
Outstanding gdr/ adr/ warrants or any convertible instruments, conversion date and likely impact on equity:
As on march 31, 2019, the company has no gdr/ adr/ warrants or any such convertible instruments outstanding and there is no likely impact on the companys equity shares in the financial year 2018-19.
Commodity price risks and commodity hedging activities: not applicable
Foreign exchange risk and hedging activities:
The company is a not forex earner and cover is taken based on budgeted rates and management judgment.
Manufacturing unit - i: plot no. C-105 and c-105/1, mahad industrial area, m.i.d.c., village khaire airwandi, sub dist. - mahad, dist. Raigad, maharashtra.
Manufacturing unit - ii: plot no. C-4, c-/1 & c-43, midc lote parshuram industrial area, taluka khed, dist. Ratnagiri, maharashtra.
Manufacturing unit - iii: b-15 & b-16, midc lote parshuram industrial area, taluka khed, dist. Ratnagiri, maharashtra.
Manufacturing unit - iv: d-27/5, midc lote parshuram industrial area, taluka khed, dist. Ratnagiri, maharashtra.
Address for correspondence:
Investors and shareholders can correspond with the company at the following address:
Lasa supergenerics limited
B-207, citi point, near kohinoor continental hotel,
J.b. Nagar, andheri east, mumbai 400 059 tel no. +91 22 4970 1092
Investor correspondence should be addressed to investor@ lasalabs.com.
To allow us to serve shareholders with greater speed and efficiency, the company strongly recommends email based correspondence on all issues, which do not require signature verification for being processed. Shareholders are expected to update any change in their residential address with our rta to avoid non-receipt of dividends, annual reports, etc.
A. Materially significant related party transaction that may potentially conflict with the companys interest
During fy 2018-19, there were no materially significant related party transactions; that is, transactions of the company of material nature with bodies including its subsidiaries, promoters, directors, management, and relatives, which may have potential conflict with the interests of company at large. Attention of members is drawn to disclosures of transactions with related parties, as set out in notes to accounts.
B. Details of non-compliance
There has not been any non-compliance of mandatory requirements of the company. No penalties or strictures were imposed on the company by the stock exchanges, sebi, or any statutory authority for matters related to capital markets during the last 3 years.
C. Vigil mechanism/ whistle blower policy
With a view to establish a mechanism for protecting employees reporting unethical behaviour, frauds, or violation of the companys code of conduct, the board of directors have adopted a whistle blower policy. No person has been denied access to the audit committee.
D. Web link for policies
The whistle blower policy, the policy for determining material subsidiaries, and the policy on dealing with related party transactions are available on the link www.lasalabs . Com
E. Utilization of funds
There were no funds raised through preferential allotment or qualified institutions placement as specified under regulation 32 (7a) during this financial year.
F. Certificate from practicing company secretary on directors eligibility
A certificate from a company secretary in practice that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of the companies by the board/ministry of corporate affairs forms the part of this report (attached in the board report).
G. Details of total fees paid to statutory auditors
The details of total fees for all the services paid by the company to statutory auditor are as follows:
(Rs in lakhs)
|Type of service||2018-19||2017-18|
H. Disclosures in relation to the sexual harassment of women at workplace (prevention, prohibition and redressal) act, 2013:
|Number of complaints||Received during financial year 201819||Disposed during financial year 201819||Pending at the end of financial year 201819|
I. Details of compliance with corporate governance requirements
The company has complied with the requirements specified in regulation 17 to 27 and clause (b) to (i) of sub regulation (2) of regulation 46 of listing regulations.
J. Recommendation by the board committees:
There has been no instance of rejection by the board for any recommendations by the board committees during this financial year.
K. Practicing company secretarys certificate on corporate governance
As stipulated in para e of schedule v of the listing regulations, the practicing company secretarys certificate regarding the compliance of conditions of corporate governance is attached to the boards report.
L. Declaration by the managing director & ceo
I, dr. Omkar p herlekar, chairman & managing director of lasa supergenerics limited (lasa) hereby confirm pursuant to sebi (listing obligations & disclosure requirements) regulations, 2015, that
the board of directors of lasa has laid down a code of conduct for all the board members and senior management of the company.
all the board members and senior management personnel have affirmed their compliance with the said code of conduct for the year ended march 31, 2019.