parmax pharma ltd share price Directors report


& MANAGEMENT DISCUSSION AND ANALYSIS

Dear Shareholders,

The Board of Directors are pleased to present their 29th Annual Report on the business and operations of the Company andthe Audited financial accounts for the Year ended 31st March, 2023.

Financial Results:

Particulars

For the year ended on 31st March, 2023 For the year ended on 31st March, 2022
Net Total Income
1546.41 1831.39

Less: Operating and Admin. Exps.

1353.94 1607.85
Profit before depreciation and Taxes 192.47 223.54

Less: Depreciation

187.86 193.21

Less: Extraordinary/Exceptional Items

0 0
Net Profit/(Loss) on sale of Fixed Assets 0 0

Profit before Tax (PBT)

4.61 30.33

Less: Taxes (including deferred tax and fringe benefit tax)

Profit after Tax (PAT) -10.40 14.32
Balance Available for appropriation 140.48 150.88
Which the Directors propose to appropriate as under:
(i) Proposed Dividend 0 0
(ii) Corporate Dividend Tax 0 0
Surplus Carried to Balance Sheet -10.40 14.32
Earnings Per Equity Share
Basic -0.28 0.38
Diluted -0.28 0.38

HIGHLIGHTS OF PERFORMANCE:

? Revenue from Operations

In FY 2023, your Company recorded total revenue from operations of Rs. 1542.43 lacs as against Rs. 1825.11 lacs in FY 2022. Due to poor market conditions and other several factors the Company witnessed the 15% decline in the revenue.

? Reported Net Profit after Tax / (Loss)

In FY 2023, your Company recorded negative profit / (Loss) of Rs. 10.40 lacs against the Profit after tax of Rs. 14.32 lacs in previous year. .

DIVIDEND:

Keeping in view the financial results and in order to conserve financial resources for the future requirement of the fund, your directors do not recommend any dividend during the year under review

PUBLIC DEPOSITS:

The Company had accepted deposits of Rs. 25 Lakh from Relative of Directors and Promoters and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the relative of Director contravenes.

SUBSIDIARY/ JOINT VENTURE/ ASSOCIATE COMPANY:

As on 31st March, 2023, Your Company has Nil Subsidiary/Joint Venture/ Associate Company.

TRANSFER TO RESERVES:

During the year under review, no amount was transferred to general reserves by the Company.

INTERNAL CONTROL SYSTEMS:

Your Company has a robust system of internal controls commensurate with the size of the Company and the nature of its business, which ensures that transactions are recorded, authorised and reported correctly apart from safeguarding itsassets against loss from wastage, unauthorized use and disposition. The internal control systems are supplemented by well documented policies, guidelines and procedures which are in line with the internal financial control framework requirements. There is an extensive programme of internal audit by a firm of chartered accountants followed by periodic management reviews. The Audit Committee actively reviews the adequacy and effectiveness of the internal control systemsand suggests improvements to strengthen the same.

RISK MANAGEMENT:

Your Company considers that risk is an integral part of its business and therefore, it takes proper steps to manage all risks in a proactive and efficient manner. The Company management periodically assesses risks in the internal and external environment and incorporates suitable risk treatment processes in its strategy and business and operating plans. The details of practices being followed by the Company in this regard, form part of the Corporate Governance Report. There areno risks which, in the opinion of the Board, threaten the very existence of your Company. However, some of the challenges faced by it have been dealt with under Management Discussion and Analysis which forms part of this Report.

BOARD MEETINGS HELD DURING THE YEAR:

Details of the meetings of the Board held during the year, form part of the Corporate Governance Report

DIRECTORS AND KEY MANAGERIAL PERSONNEL:

In terms of Section 152 of the Companies Act, 2013, Mr. Umang Alkesh Gosalia (DIN: 005173830) is liable to retire by rotation at forthcoming AGM and being eligible offers himself for re-appointment. A brief resume of director being re-appointed with the nature of their expertise, their shareholding in the Company as stipulated under as required under Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, is annexed to this Notice of the ensuing Annual General Meeting. The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 16(1) (b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. All the directors of the Company have confirmed that they are not disqualified from being appointed as directors in terms of Section 164 of the Companies Act, 2013.

MATTERS AS PRESCRIBED UNDER SUB-SECTIONS (1) AND (3) OF SECTION 178 OF THE COMPANIES ACT 2013:

The policy of the Company on directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Sub section (3) of Section 178 of the Companies Act, 2013, adopted by the Committee, is appended in the Corporate Governance Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013 (the ‘Act), the Directors, to the best of their knowledge, confirm that:

i. In the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures, if any; i

i. Appropriate accounting policies have been applied consistently and judgements and estimates that are reasonable and prudent have been made 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 of the Company for the period; ii

i. Proper and sufficient care has been taken for 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. The Annual Accounts have been prepared on a going concern basis;

v. The internal financial controls to be followed by the Company have been laid down and such internal financial controls are adequate and are operating effectively; and v

i. Proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and are operating effectively.

EXTRACT OF ANNUAL RETURN AS PER SECTION 92 (3) OF COMPANIES ACT, 2013:

The Annual Return as required under Section 92 and Section 134 of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is available on the website of the Companyand the web-link for the same is https://www.parmaxpharma.com/investor_relations.php

KEY FINANCIAL RATIOS:

Key Financial Ratios for the financial year 2022-23 with comparatives for the year 2021-22, are disclosed in Financial Statements.

Management has also provided the reasons for where variances are in excess of 25% compared to previous year and Management is very proactive and is actively evaluating the causes of differences in ratios and actively working for improving its ratios.

BOARD EVALUATION:

Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an annual evaluation of its own performance, the directors individually, as well as the evaluation of the working of its Committees. At the meeting of the Board all the relevant factors that are material for evaluating the performance of individual Directors, the Board and its various committees were discussed in detail. A structured questionnaire each for evaluation of the Board, its various Committees and individual Directors was prepared and recommended tothe Board by Nomination & Remuneration Committee for doing the required evaluation after taking into consideration the input received from the Directors covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its Committees, execution and performance of specific duties, obligations and governance etc.

AUDITORS:

STATUTORY AUDITORS:

In terms of provisions of Section 139 of the Act and the Rules made thereunder, the Shareholders of the Company have appointed M/s B.A. Shah S.R. Mehta & Co., Chartered Accountants for the purpose of carrying out Statutory Audit of the Company.

The existing term of office of M/s. B A Shah S R Mehta & Co., Chartered ? Accountants, Statutory Auditors is valid upto the ensuing Annual General Meeting of the Company.

The Board of Directors of the Company at their meeting held on 14.08.2023 has approved the reappointment of M/s. B A Shah S R Mehta & Co., as the statutory Auditors for a second term of 5 (Five) years commencing from the conclusion of ensuing i.e. 29th Annual General Meeting till the conclusion of the 34th Annual General Meeting to be held in the year 2028, subject to the approval of Shareholders in ensuing AGM.

The Independent Auditors Report for FY 2023 has been obtained and contains one qualification for which requires comments from the Board.

Reporting of Frauds by Auditors

During the year, there were no instances of frauds reported by Auditors under Section 143(12) of the Act.

SECRETARIAL AUDITOR

The Board has appointed Mr. Samsad Alam Khan, Company Secretaries to conduct Secretarial Audit in accordance with the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 for FY 2023. The Secretarial Audit Report for FY 2023 has been obtained and contains one qualification for which requires any comments from the Board. The Secretarial Audit Report for FY 2023 is annexed to this report as Annexure -B.

COST AUDIT

The provisions of Cost Audit are not applicable on the Company.

BOARD RESPONSE TO SECRETARIAL AUDIT REPORT AND AUDIT REPORT:-

Your Board of Directors would like to clarify the qualification remarks made in Secretarial Audit Report asunder:-

BOARD RESPONSE TO SECRETARIAL AUDIT:-

Qualification/ Adverse Remark

Explanation :

1. Company has not complied with the provisions of Section 74 of the Companies Act, 2013 regarding acceptance of deposits.

The Board is in process of complying with Section 74 of Companies Act, 2013 regarding Acceptance of deposits.

However, Board assures to comply with the Act and Regulations.

BOARD RESPONSE TO STATUTORY AUDIT REPORT:-

Qualification/ Adverse Remark

Explanation :

The Company has accepted deposits of Rs. 25 Lakh from Relative of Directors and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the relative of Director is contravening.

The Board is in process of complying with Section 74 of Companies Act, 2013 regarding Acceptance of deposits.

INTERNAL AUDITORS:

The Board appointed M/s. B A Shah & Associates., Chartered Accountants (Firm Registration Number:- 109493W) hereby appointed as Internal Auditor of the company for the financial year 2022-23. The report prepared by the Internal Auditors is to be reviewed by the Statutory Auditors & Audit Committee.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186:

Details of Loans, Guarantees and Investments under the provisions of Section 186 of the Companies Act,2013 are not applicable to the Company.

AUDIT COMMITTEE:

The composition and the functions of the Audit Committee of the Board of Directors of the Company is disclosed in the Report on Corporate Governance, which is forming a part of this report.

RELATED PARTY TRANSACTIONS:

All the related party transactions entered into during the financial year were on an arms length basis and were in the ordinary course of business. Accordingly, the disclosure of related party transactions as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC 2 is attached in

"Annexure C".

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

During the year under review, no significant and material order was passed by the Regulators/Courts that could impact the going concern status of the Company and its future operations.

There is no proceeding pending under the Insolvency and Bankruptcy Code, 2016. There was no instanceof onetime settlement with any Bank or Financial Institution.

POLICY AGAINST SEXUAL HARASSMENT AT WORKPLACE

The Company values the dignity of individuals and is committed to provide an environment, which is free of discrimination, intimidation and abuse. The Company has put in place a policy on redressal of Sexual Harassment and a Policy on redressal of Workplace Harassment as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("Sexual Harassment Act"). As per the policy, any employee may report his/ her complaint to the Redressal Committee formed for this purpose or their Manager or HR personnel. The company has also constituted an Internal Complaints Committee to inquire into complaints of sexual harassment and recommendation for appropriate action. No complaints have been filed/ disposed of/ pending during the financial year ended 31st March,2023.

MATERIAL CHANGES:

There are no material changes and commitments, that would affect financial position of the company from the end of the financial year of the company to which the financial statements relate and the date of the directors report.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

The particulars prescribed under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are attached as ‘Annexure - D

CORPORATE GOVERNANCE:

The Company is committed to maximize the value for its stakeholders by adopting the principles of good Corporate Governance in line with the provisions of law and particularly those stipulated in the Listing Regulations. Its objective and that of its management and employees is to manufacture and market the Companys products in a way so as to create value that can be sustained over the long term for consumers, shareholders, employees, business partners and the national economy in general.

Certificate from the Practicing Company Secretary regarding compliance of the conditions of Corporate Governance as stipulated in the Listing Regulations, is enclosed.

RISK MANAGEMENT:

Your Company considers that risk is an integral part of its business and therefore, it takes proper steps to manage all risks in a proactive and efficient manner. The Company management periodically assesses risks in the internal and external environment and incorporates suitable risk treatment processes in its strategy and business and operating plans.

There are no risks which, in the opinion of the Board, threaten the very existence of your Company. However, some of the challenges faced by it have been dealt with under Management Discussion and Analysis which forms part of this Report.

Details regarding constitution of Risk Management Committee, its role and responsibilities, form part of the Corporate Governance Report.

The details of practices being followed by the Company in this regard form part of the Corporate Governance Report.

CORPORATE SOCIAL RESPONSIBILITY:

This clause is not applicable.

KEY MANAGERIAL PERSONNEL:

As at end of the year, Dr. Umang Gosalia, Managing Director, Mr. Keyur D Vora, Chief Financial Officer and CS Yash Vora, Company Secretary were the Key Managerial Personnel of the Company.

VIGIL MECHANISM/WHISTLE BLOWER POLICY:

Your Company is committed to highest standards of ethical, moral and legal business conduct. Accordingly, the Board of Directors have formulated a Whistle Blower Policy which is in compliance with the provisions of Section 177(10) of the Companies Act, 2013 and Regulation 22 of the SEBI (LODR), Regulations, 2015. It is framed for employees and Directors of the company to report to the management instances of unethical behavior, actual or suspected fraud or violation of the companys code of conduct. This policy enables the employees or directors of Company to approach the Chairman of Audit Committee. Further, the whistle blower policy is available at the website of our company at http://www.parmaxpharma.com/policies.php

DECLARATION OF INDEPENDENT DIRECTORS:

All Independent Directors have given declaration that they meet the criteria of independence as provided under Section 149 of the Act and Regulation 16 of the Listing Regulations.

The Independent Directors have also complied with the Code for Independent Directors as per Schedule IV of the Act. All our Independent Directors are registered on the Independent Directors Databank. None of the Directors of the Company are disqualified for being appointed as Directors as specified under Section 164(2) of the Act read with Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

THE CHANGE IN NATURE OF BUSINESS:

There is no material change in the business of the Company during the year under review.

MATERIAL CHANGES IN FINANCIAL POSITION:

No material change or commitment has occurred after the close of FY 2023 till the date of this Report, which affects the financial position of the Company

PARTICULARS OF EMPLOYEES:

A statement containing the names and other particulars of employees in accordance with the provisions of section 197(12) of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is appended as "Annexure C" to this report.

No employee has received remuneration in excess of the limits set out in rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 during FY 2022-23.

ORDERS PASSED BY COURTS/ REGULATORS:

No significant or material order has been passed by the regulators or courts or tribunals impacting the going concern status of the Company or its future operations.

ACKNOWLEDGMENT:

The Directors wish to place on record their appreciation to the devoted services of the workers, staff and the officers who largely contributed to the efficient management of the Company in the difficult times. TheDirectors place on record their appreciation for the continued support of the shareholders of the Company. The Directors also take this opportunity to express their grateful appreciation for assistance and cooperation received from the bankers, vendors and stakeholders including financial institutions, Central and State Government authorities, other business associates, who have extended their valuable sustained support and encouragement during the year under review.

By and order of Board of Directors
For, Parmax Pharma Limited
Date: 14th August, 2023 Dr. Umang Gosalia
Place: Rajkot Managing Director
DIN: 05153830