Oxygenta Pharma Director Discussions


To the members,

Your directors submit annual report of "Oxygenta Pharmaceutical Limited (formerly known as S.S. Organics Ltd.)"along with the audited financial statement for the year ended March 31,2023.

(Rs. In Lakhs)
Q Ma S.No.

For the financial Year Ended

Particulars 31st March 2023 31st March 2022
1 Revenue from operations 3098.74 6052.48
2 Other Income 1.78 0.45
3 Total Revenue 3098.75 6052.94
4 Less: Total Expenses 4164.37 6156.51
5 Profit before tax/Loss (1-2) (1137.27) (48.94)
6 Less: Current Tax - -
7 Less: Deferred Tax (19,83) (12.11)
8 Profit available for appropriations/Loss (1157.10) (61.05)
9 Total Other comprehensive Income (1157.10) (61.05)

2. REVIEW OF OPERATIONS:

The Gross total Income of the Company has decreased by 48.80% from Rs. 6052.94 Lakhs in FY 2021-22 to Rs. 3098.75 Lakhs in FY 2022-23 and the total expenses of the Company has also decreased by 31.76% from 6,102 Lakhs in FY 2021-22 to Rs. 4,164 Lakhs in FY 2022-23. The loss of the Company has increased from loss of Rs. 61 Lakhs in FY 2021-22 to Rs. 1,157 Lakhs in FY 2022-23. The EPS of the Company has been decreased to (8.15) times in FY 202223 from EPS of (0.48) times in FY 2021-22.

The Companys management is striving towards achieving the goals of shareholders by incremental growth of operations in upcoming years. The Management is working on improving the financial position and is confident about the future growth of the Company.

3. Dividend:

Your Board of Directors does not recommend any dividend for the year 2022-23.

4. Change in nature of business if any.

During the current FY 2022-23 there is no change in nature of business in your Company.

5. Transfer To Reserves:

Your Company has not transferred any amount to the general reserve.

6. Share Capital:

During the year under review, there was no change in the paid-up share capital of your Company. The paid-up Equity Share Capital of your Company as on March 31,2023 stood at Rs.14,20,13,000 comprising of 1,42,01,300 equity shares of face value of Rs.10/- each.

During the year under review, the shareholders of the Company, at their Extra ordinary General meeting held on 23rd March, 2023, by passing special resolutions, have approved the following:

1) Issue of 73,95,000 equity shares on preferential basis to Promoters and Non-Promoters*

2) Issue of 1,28,37,200 share warrants which are convertible into 1,28,37,200 equity shares of Rs.10/- each at an issue price of Rs.15/- per share to Promoters and Non-Promoters for cash consideration*

3) Issue of 5,50,000 equity shares of Rs.10/- each at an issue price of Rs.15/- per share against the conversion of unsecured loan amount aggregating to Rs.82,50,000/- on preferential basis to existing promoters.*

*After the end of the financial year of 2022-23, the Company has allotted 1,92,82,200 Equity Shares of Rs.10 each on Preferential basis out of which 79,45,000 Equity shares were allotted on 26th April, 2023, 85,80,700 Equity Shares were allotted on 29th April 2023, and 27,56,500 Equity Shares were allotted on 03rd May, 2023.

7. The details of directors or key managerial personnel who were appointed or have resigned during the year:

a) Directors:

There is no change in the composition of the Board of Directors of the company during the FY 2022-23.

But Subsequent to the closure of Financial Year on 04th September 2023, Mr. Gunreddy Krishna Reddy & Rajasekhar Reddy Puchakayala resigned as the Executive Directors of the Company and Mr.Gangi Reddy Narravula resigned as the Non-Executive Independent director of the company.

And Board of the company in their meeting held on 04th September 2023, appointed Mr. Sunil Vishram Chawda & Mrs. Sravani Reddy Gantla as additional directors in the category of Executive directors of the company and appointed Mr. Bharath Reddy Guntuku as Additional Director in the category of Non- Executive Independent Director.

Due to the open offer board of the company reconstituted.

b) Key Managerial Personnel:

The following have been designated as the Key Managerial Personnel of the Company pursuant to Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

Mr. Vankineni Sai Sudhakar - Managing Director & CFO Mr. Veerenrda Babu R, - Company Secretary

Subsequent to the closure of Financial Year Mr. Veerenrda Babu R has resigned as the Company Secretary of the Company with effect from June 30,2023.

8. Acceptance of Deposits:

The Company has not accepted any deposits which cover under the Section 73 of the Companies Act, 2013.

9. Particulars of Loans, Guarantees or investments:

Loans, guarantees and investments covered under section 186 of the Companies Act, 2013 from part of the notes to the financial statements provided in this Annual Report.

10. Particulars of Contracts or arrangement made with related parties:

The details of particulars of Contracts or arrangement made with related parties under Section 188(1) of the Companies Act, 2013 is provided shall form part of this financial statements of this Annual Report.

11. Material changes and commitment affecting financial position between the end of the financial year and date of report:

The of Board of Directors in their meeting held on 26th April, 2023 has allotted 85,80,700 Equity Shares, and Board of Directors in their meeting held on 29th April 2023 has allotted 27,56,500 Equity Shares and allotted 27,56,500 Equity Shares in their meeting held on 03rd May, 2023 having the face value of Rs.10/- each at a premium of Rs.5/- each via Preferential Allotment. The said issuance was approved by the Shareholders of the Company in its Extra ordinary General Meeting held on 23rd March, 2023. Pursuant to the Preferential Allotment to the Mr. Sunil Vishram Chawda ("Acquirer 1"), Mr. Manoj Sunil Chawda ("Acquirer 2"), Mrs. Aakanksha M. Chawda ("Acquirer 3") and Mr. Raghavender Rao Kanuganti ("Acquirer 4") (hereinafter collectively referred to as "Acquirers"), an obligation on the Acquirers to make an open offer to the Equity Shareholders of the Company (including the Non-Promoter Non-Public Shareholder of the Company) but excluding the Shareholders forming part of the Promoter and Promoter group of the Company in terms of Regulations 3 and 4 of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 ("Open Offer") was triggered. and upon completion of the Open Offer, Acquirers classified as the Promoter along with the existing members of the Promoter and Promoter group of the Company.

12. Issue of Debentures:

During the current FY 2022-23 the Company has not issued any Debentures.

13. Unsecured Loans from Directors

The Company during the financial year has not received unsecured loans from the Directors except as specified in the Note No.13A to the Financial Statements.

14. Subsidiaries, Joint Ventures and Associate Companies

The Company does not have any Subsidiary, Joint venture or Associate Company during the year under review.

15. Acquisitions during the year:

During the current FY 2022-23 there is no acquisitions by the Company.

16. Maintenance of cost records:

The Company maintaining the Cost records as specified by the central government under sub-section (1) of section 148 of the Companies act, 2013.

17. Directors Responsibility Statement:

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their Knowledge and ability, confirm that:

i. In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii. They 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 and of the profit and loss of the company for that period.

iii. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

iv. They have taken prepared the annual accounts on a going concern;

v. They have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;

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

Based on the framework of internal financial controls and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and external consultants and the reviews performed by management and the relevant board committees, including the audit committee, the board is of the opinion that the Companys internal financial controls were adequate and effective during the financial year 2022-23.

18. Number of meetings of the Board:

Six (06) meetings of the board were held during the current financial year 2022-23. For details of the meetings of the board, please refer to the corporate governance report, which forms part of this report.

19. Declaration by independent directors:

The Company has received necessary declaration from each independent director under section 149(7) of the Companies Act, 2013. That he meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013.

20. Compliance with Secretarial Standards on Board Meetings and General Meetings:

During the current FY 2022-23, the Company has complied with secretarial standards issued by the Institute of Company Secretaries of India on Board of Directors Meetings and Annual General Meetings.

21. Board Evaluation:

As required under the provisions of Schedule IV of the Companies Act, 2013, the performance evaluation of independent directors has been done by the entire Board of Directors, excluding the director being evaluated. The evaluation of all the directors and the Board was conducted based on the criteria and framework adopted by the Board. The Board approved the evaluation results as collated by the nomination and remuneration committee.

22. Policy on directors appointment and remuneration and other details.

The Companys policy on directors appointment and remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the corporate governance report as Annexure - III, which forms part of the directors report.

23. Internal financial controls:

Your Company is committed to constantly improve the effectiveness of internal financial controls and processes for efficient conduct of its business operations and timely preparation of reliable financial information. In the opinion of the Board, the internal financial control system of the Company commensurate with the size, scale and operations of the Company.

The Internal Controls over Financial Reporting are routinely tested and certified by Statutory as well as Internal Auditors. The Audit Committee reviews the adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems. Further, the internal financial controls with reference to the Financial Statements are adequate in the opinion of the Board of Directors and were operating effectively.

24. Corporate Social Responsibility (CSR):

During the current FY 2022-23, the Company did not meet the requirements under provisions of section 135 read with Schedule VII of the Companies Act, 2013. Hence, CSR not applicable to the company.

25. Vigil Mechanism:

In pursuance to the provisions of section 177 of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a Vigil Mechanism for Directors and Employees to report genuine concerns has been established. This mechanism enables the Whistle Blower to make protected disclosures to the Chairman of the Audit Committee.

The detailed policy on whistle blower mechanism has been available on the website of the Company http:// oxygentapharma.com/polices.html

26. Risk Management:

The Risk Management is overseen by the Audit Committee of the Company on a continuous basis. The Committee oversees Companys process and policies for determining risk tolerance and review managements measurement and comparison of overall risk tolerance to established levels. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuous basis.

27. Reporting of frauds:

There was no such instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and / or Board under Section 143(12) of the Act and the rules made thereunder.

28. Audit Committee:

Your company has constituted the Audit Committee within the provisions laid down in Section 177(2) of Companies Act, 2013 and read with the regulation 18 of SEBI (LODR), 2015.

The detailed composition, no of meetings held and date of meetings have been mentioned in corporate governance report as Annexure - III which forms part of the Boards report.

29. Annual Return:

Annual Return in Form MGT-7 is available on the Companys website, the web link for the same is http:// oxygentapharma.com/.

30. Conservation of energy, research and development, technology absorption, foreign exchange earnings and outgo.

The particulars as prescribed under Sub-Section (3)(m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are enclosed as Annexure -1 to the Boards Report.

31. Nomination and Remuneration Policy:

A committee of the Board named as "Nomination and Remuneration Committee" has been constituted to comply with

the provisions of section 178, Schedule IV of the Companies Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. As recommended by the Committee the Board adopted a policy on Directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters to frame proper systems for identification, appointment of Directors & KMPs, Payment of Remuneration, Evaluation of their performance.

Nomination and Renumeration policy is enclosed as Annexure-II to this report.

32. Corporate Governance Report:

Your Company has complied with the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. An Auditors Certificate on Corporate Governance in compliance with the code of Corporate Governance is enclosed as Annexure - III to this report.

33. Management Discussion and Analysis:

A brief note on the Management discussion and analysis for the current FY 2022-23 is enclosed as Annexure - VIto this report.

34. Auditors:

• Board of directors appointed M/s. A.M.Reddy & D.R.Reddy, Chartered Accountants, (Firm Registration No. FRN: 0090685), as the statutory auditors of the company till the conclusion of the 30th AGM to fill the fill the casual vacancy occurred due to the resignation of M/S. Gowri Shankar & Associates, Chartered Accountants, (Firm Registration No.015625S).

And Board of Directors recommend the re-appointment of M/s. A.M.Reddy & D.R.Reddy, Chartered Accountants, (Firm Registration No. FRN: 0090685), as the Statutory Auditors of the Company from the conclusion of 30th AGM till the conclusion of 35th AGM subject to approval of the Shareholders.

• The Internal Auditors of the Company, M/s. Ram and Associates, Chartered Accountants, (Firm Registration No.017686S), Chartered Accountants, who were appointed as the Internal Auditors of the Company.

• N. Vanitha of M/s. P.S. Rao & Associates, Practicing Company Secretaries was appointed to conduct the secretarial audit of the Company for the Financial Year 2022-23, as required under Section 204 of the Companies Act, 2013 and Rules thereunder. The Secretarial Audit Report for FY 2022-23 forms part of the Annual Report as Annexure - VII to the Boards Report.

• P Chandra Sekhara Reddy of M/s. PCR & ASSOCIATES, Cost Accountants was appointed to conduct the Cost audit of the Company for the Financial Year 2022-23, as required under the Companies Act, 2013 and Rules thereunder.

35. Auditors Report

There are no qualifications, reservations or adverse remarks or disclaimers made by M/S. Gowri Shankar & Associates, Chartered Accountants, (Firm Registration No.015625S), Statutory Auditors in their report for the Financial Year ended March 31,2023.

36. Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors, Internal Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Directors or officers or Employees to the Audit Committee under Section 143(12) of the Companies Act, 2013, details of which needs to be mentioned in this Report.

37. Particulars of Employees:

The information required under section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the Financial Year:

Directors Ration to median remuneration
Dr. Sai Sudhakar Vankineni 4.7 times
Sri Gunreddy Krishna Reddy 0 times

"The Company has not paid any remuneration to the non-executive directors of the Company for the Financial Year 2022-23."

b. The percentage increase in remuneration of each director, Chief Executive Officer, Chief Financial Officer, Company Secretary in the Financial Year:

"During the Financial Year 2022-23, company secretory remuneration increased by 21.43%, other than that there is no increase in the remuneration of each director, chief executive officer, chief financial officer of the Company."

c. Median remuneration of the company for the F.Y 2022-23 is Rs.21,250 per month.

d. The Percentage increase in the median remuneration of employees in the Financial Year: 15.29%

e. The number of permanent employees on the rolls of Company: 157.

f. The explanation on the relationship between average increase in remuneration and Company Performance:

The Company from time to time reviewing the increase in remuneration based on the performance of the employee(s).

g. Comparison of the remuneration of the key managerial personnel against the performance of the Company:

Aggregate remuneration of Key managerial personnel (KMP) in FY 2022-22 8,10,000
Total Revenue 31,00,52,356
Remuneration of KMPs ( as % of Revenue) 0.26%
Profit Before Tax ( PBT) NA
Remuneration of KMP ( as % of PBT) NA

h. Comparison of each remuneration of the Directors (Executive) against the performance of the Company:

Particulars Dr. Sai Sudhakar Vankineni, Executive Director G Krishna Reddy, Executive Director
Remuneration in FY 2022-23 12,00,000 Nil
Revenue (Rs.) 31,00,52,356 31,00,52,356
Remuneration as % of revenue 0.39% NA
Profit Before Tax (PBT) NA NA
Remuneration (as % of PBT) NA NA

i. Affirmation that the remuneration is as per the remuneration policy of the Company:

The Company affirms remuneration is as per the Nomination and Remuneration policy of the Company.

38. Cautionary Statement:

Statements in the Directors Report and the Management Discussion and Analysis Report describing the Companys objectives, projections, expectations, estimates or forecasts may be forward-looking within the meaning of applicable laws and regulations. Actual results may differ substantially or materially from those expressed or implied therein due to

risks and uncertainties. Important factors that could influence the Companys operations, inter alia, include input availability and prices, changes in government regulations, tax laws, economic, political developments within the country and other factors such as litigations and industrial relations.

39. General:

Your directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

1. Issue of Equity Shares with differential rights as to dividend, voting or otherwise.

2. Issue of Shares (including Sweat Equity Shares) to employees of the Company under any scheme.

3. Neither the Managing Director nor the Whole-time Directors of the Company received any remuneration or commission from any of its subsidiaries (Not applicable as the Company does not have any subsidiary company)

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

5. Your directors further state that during the year under review, there were no cases filed/registered pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

40. Details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year:

No application was made or any proceedings were pending under the IBC, 2016 during the year ended on March 31, 2023.

41. Details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof:

Not Applicable

42. Green initiative in Corporate Governance

The Ministry of Corporate Affairs (MCA) has taken a green initiative in Corporate Governance by allowing paperless compliances by the Companies and permitted the service of Annual Reports and documents to the shareholders through electronic mode subject to certain conditions and your Company continues to send Annual Reports and other communications in electronic mode to the members who have registered their email addresses with your Company/ RTA.

43. Acknowledgement:

Your directors wish to express their gratitude to the central and state governments, investors, analysts, financial institutions, banks, business associates and customers, the medical profession, distributors and suppliers for their whole-hearted support. Your directors commend all the employees of your company for their continued dedication, significant contributions, hard work and commitment.

For and on behalf of the Board
Oxygenta Pharmaceutical Limited
(Formerly known as S.S. Organics Ltd.)
Sd/-
Dr. Sai Sudhakar Vankineni
Place: Hyderabad Chairman and Managing Director
Date: 04th September, 2023 (DIN:00733001)