Dear Members,
On behalf of the Board of Directors of the Company, it gives us immense pleasure in
presenting the Sixth Boards Report along with the audited financial statements
(standalone and consolidated) for the financial year ended March 31, 2023.
1. FINANCIAL PERFORMANCE
The Company has prepared the Standalone and Consolidated financial statements for the
financial year ended March 31, 2023, in accordance with the Indian Accounting Standards
(Ind AS) as prescribed under the Companies Act, 2013. Key highlights of financial
performance of the Company for the financial year ended March 31, 2023, as compared to
previous year is provided below:
Rs in Crores
Financial Results |
Standalone |
Consolidated |
| 2022-23 |
2021-22 |
2022-23 |
2021-22 |
Gross Revenue |
1465.95 |
1,287.10 |
1466.36 |
1,288.36 |
Profit before interest, depreciation and tax |
150.26 |
91.19 |
150.65 |
92.23 |
Profit before tax |
(44.78) |
(91.66) |
(44.82) |
(91.11) |
Profit after tax |
(22.21) |
(58.56) |
(22.25) |
(58.29) |
EPS (basic) on the basis of C 10/- per share |
(6.17) |
(16.29) |
(6.16) |
(16.18) |
EPS (diluted) on the basis of C 10/- per share |
(6.17) |
(16.29) |
(6.16) |
(16.18) |
2. BUSINESS OVERVIEW
We are a global, R&D focused, pureplay Active Pharmaceutical Ingredients (API)
company engaged in the manufacturing and development of APIs and offering Contract
Manufacturing and Development Services for global companies. We have a highly compliant
manufacturing footprint spread over six large scale multi-product facilities supported by
a team of 2300+ employees. Our business is spread across 75 countries with extensive
operations in the key markets of North America, Europe, Japan, South Korea and the Middle
East and North Africa. We are poised to create strategic value in the B2B space with a
basket of high-value products, compliant manufacturing base, long term supply assurance
and strong customer advocacy. New programs were introduced for cost improvement, better
site utilization and operating cost savings. The Company remains optimistic about
accelerating all the levers of its strategy and is confident in delivering long term value
to our stakeholders. A detailed analysis of the operations of the company for the year
gone by is provided in the management discussion and analysis report, which forms a part
of this annual report.
3. DIVIDEND
The Board of Directors of the company has not recommended dividend for the financial
year 202223. During the year under review, your company has not made any transfer to the
reserves.
I n terms of Regulation 43A of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (Listing Regulations), the Company has adopted a Dividend
Distribution Policy. The said Policy is available on the Companys website and can be
accessed at investor page of our compa nys we bsite https://solara.co.in/wp-content/
uploads/2020/10/Dividend Distribution Policy.pdf
4. SHARE CAPITAL
The Authorized Share Capital of the Company as on March 31, 2023, stood at C
120,00,00,000/- divided into 12,00,00,000 equity shares of C 10/- each.
There has been no increase in the Paid-up share capital of the Company during the
financial year.
The Issued, Subscribed and Paid-up Equity share capital of the Company as on March 31,
2023, stood at C 35,99,62,670/- divided into 3,59,96,267 equity shares of C 10/- each.
5. EMPLOYEES STOCK OPTION PLAN
The company has formulated an ESOP Scheme titled "Solara Employees Stock Option
Plan 2018".
During the year under review, Nomination and Remuneration Committee of the Board (NRC)
has granted 3,24,600 options convertible into equal number of equity shares of face value
of C 10/- each to the senior management personnel of the Company. Statement giving
detailed information on stock options granted to Employees as required
under the Companies Act and SEBI Regulations is enclosed as Annexure 8 to this Report.
6. MATERIAL CHANGES AFFECTING FINANCIAL POSITION OF THE COMPANY
There are no material changes and commitments occurred, affecting the financial
position of the Company, between the end of the financial year and the date of this
report.
7. SUBSIDIARIES
The details of Subsidiary Companies and their financial position as required under the
first proviso to Section 129(3) is given in Form AOC-1 as Annexure-1 as part of this
report.
8. CORPORATE GOVERNANCE
Your Company is committed to maintain the highest standard of Corporate Governance and
adhere to Corporate Governance guidelines as laid out in the Listing Regulations.
The detailed report on Corporate Governance as per the format prescribed by Securities
and Exchange Board of India under Schedule V of the Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 along with a
certificate from M/s. Mohan Kumar and Associates, Practicing Company Secretaries,
confirming compliance with the requirements of Corporate Governance is attached with this
report. There are no observations or adverse remarks in the said certificate.
As required by Listing Regulations, a certificate from M/s. Mohan Kumar and Associates,
Practicing Company Secretary confirming 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 is attached to this report as Annexure 7
Pursuant to the SEBI circular no. CIR/CFD/ CMD1/27/2019 dated February 8, 2019, the
Company has obtained an Annual Secretarial Compliance Report from M/s. Mohan Kumar and
Associates, Practicing Company Secretaries confirming compliance of SEBI Regulations /
Circulars / Guidelines issued thereunder and applicable to the Company. There are no
observations or adverse remarks in the said report.
9. MANAGEMENT DISCUSSION AND ANALYSIS
Pursuant to Schedule V of Listing Regulations "Management Discussion and
Analysis" is given separately and forms part of this Report.
10. NUMBER OF MEETINGS OF THE BOARD
During the financial year 2022-23, the Directors met four times i.e., on April 29,
2022; August 4, 2022; November 9, 2022; and January 25, 2023.
11. DIRECTORS & KEY MANAGERIAL PERSONNEL
As on date of this report, the Board has 9 directors comprising of 2 Executive
Directors, 3 NonExecutive Directors and 4 Independent Directors. The Chairman of the Board
is a Non-Executive Director. The details of each member of the Board as on the date of
this report forms part of Corporate Governance Report.
Retiring by Rotation:
a) Mr. Ankur Thadani, Non-Executive Director, retires by rotation at the ensuing Annual
General Meeting and being eligible, offers himself for reappointment. Your directors
recommend his reappointment.
Detailed profile of the Director retiring by rotation is attached as Annexure 5 to this
report
Change in directors and key managerial personnel during the year:
1. Mr. Rajender Rao Juvvadi resigned from the post of MD & CEO of the Company on
April 28, 2022.
2. Mr. Jitesh Devendra was appointed as Managing Director of the Company on April 29,
2022, and he has been designated as Key Managerial Personnel.
3. Mr. Kartheek Raju Chintalapati resigned from the directorship of the Company on
August 3, 2022.
4. Mr. Poorvank Purohit was appointed as Chief Executive Officer of the Company with
effect from February 3, 2023, and he has been designated as Key Managerial Personnel.
5. Mr. Nirmal P Bhogilal was re-appointed as an Independent Director for second
Consecutive term of five years, with effect from April 11, 2023
6. Mr. R Ramakrishnan was re-appointed as an Independent Director for second
Consecutive term of five years, with effect from April 11, 2023
7. Dr. Kausalya Santhanam was re-appointed as an Independent Director for second
Consecutive term of five years, with effect from April 11, 2023
The following are the Key Managerial Personnel (KMPs) as on the date of this report:
- Mr. Jitesh Devendra, Managing Director.
- Mr. S. Hariharan, Executive Director & Chief Financial Officer.
- Mr. Poorvank Purohit, Chief Executive Officer
- Mr. S. Murali Krishna, Company Secretary.
12. DECLARATION BY INDEPENDENT DIRECTORS
In accordance with Section 149(7) of the Companies Act, 2013 each Independent Director
has confirmed to the Company that he / she meets the criteria of independence as laid down
in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing
Regulations and that they are not aware of any circumstances or situations, which exists
or may be reasonably anticipated that could impair or impact their ability to discharge
duties with an objective independent judgement and without any external influence. In the
opinion of the Board, all Independent Directors are independent of the management.
13. BOARD EVALUATION
The Companies Act and Listing Regulations relating to Corporate Governance contain
provisions on evaluation of the performance of the Board and its Committees as a whole and
Directors including Independent Directors, Non-Independent Directors, and Chairperson
individually. In pursuant thereof, annual evaluation of performance of the Board, working
of its committees, contribution and impact of individual directors has been carried out
through a questionnaire for peer evaluation on various parameters.
14. PARTICULARS OF EMPLOYEES
The statement containing particulars in terms 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 forms part of this report and is appended herewith as Annexure 6 to
the Boards report
The statement containing particulars in terms of Section 197(12) of the Companies Act,
2013 read with rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 forms part of this report. Considering the first proviso
to Section 136(1) of the Companies Act, 2013, the Annual Report, excluding the aforesaid
information, is being sent to the members of the Company and others entitled thereto. Any
shareholder interested in obtaining a copy thereof, may write to the Company Secretary in
this regard.
15. CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company has undertaken "Corporate Social Responsibility (CSR)",
initiatives in areas of Health, Education and Employability which are projects in
accordance with Schedule VII of the Companies Act, 2013.
A detailed report on CSR activities undertaken during the financial year 2022-23 is
enclosed as Annexure-2 to this Report.
16. RISK MANAGEMENT
The Company has a risk management framework for the identification and management of
risks.
In line with the requirement under the SEBI Listing Regulations, the Company has
constituted a Risk Management Committee (RMC), comprising of members of the Board and
Senior Management personnel. Composition of RMC is provided in the Corporate Governance
Report, which forms part of this Report.
RMC is entrusted with the responsibility of overseeing strategic, operational and
financial risks that the organization faces, along with the adequacy of mitigation plans
to address such risks.
Additional details relating to Risk Management are provided in the Management
Discussion and Analysis report forming part of this Report.
17. LOANS, GUARANTEES OR INVESTMENTS
Particulars of investments made, loans given and guarantees covered under the
provisions of Section 186 of the Companies Act, 2013 are provided in Note No. 47 to the
Standalone Financial Statements in the Annual Report.
18. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All the transactions with related parties are in the ordinary course of business and at
arms length basis. The transactions with related parties are disclosed in Note No. 40 to
the Standalone Financial Statements in the Annual Report. The disclosure of contracts or
arrangements with related parties for material transactions is furnished in Form AOC-2 as
Annexure 9 as part of this report.
The Company has formulated a policy for transacting with Related Parties, which is
uploaded on the website of the Company. Further, there are no materially significant
related party transactions with its promoters, the directors or the management, their
subsidiaries, or relatives, etc. that may have potential conflict with the interests of
the Company at large.
19. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators / Courts that
would impact the going concern status of the Company and its future operations.
20. AUDITORS AND AUDIT REPORTS
Statutory Auditors
M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration
No.117366W/W-100018) was appointed as Statutory Auditors of the Company at the first
Annual general meeting of the company for a period of 5 years and will hold the office
till the conclusion of the 6th AGM of the Company. The Auditors report to the
shareholders on the standalone and consolidated financial statement for the year ended
March 31, 2023, does not contain any qualification, observation or adverse comment.
The Audit Committee and the Board of Directors of the Company at their meeting held on
May 12, 2023, approved the re-appointment of M/s. Deloitte Haskins & Sells LLP,
Chartered Accountants as the Statutory Auditors for a second term of four (4) years i.e.,
from the conclusion of the 6th AGM till the conclusion of the 10th AGM of the Company to
be held in the year 2027
The necessary resolution seeking your approval for their re-appointment as statutory
auditors are included in the notice of ensuing AGM along with necessary disclosures
required under the Companies Act, 2013 and the SEBI Listing Regulations.
Secretarial Audit Report
M/s. Mohan Kumar & Associates, Practicing Company Secretaries, Chennai, is the
Secretarial Auditor for the Company.
The Secretarial Audit for the financial year 202223, inter-alia, included audit of
compliance with the Companies Act, 2013, and the Rules made under the Act, Listing
Regulations and applicable Regulations prescribed by SEBI amongst others.
The Secretarial Audit Report is enclosed as Annexure 4 to the Boards Report. The
Secretarial Audit Report does not contain any qualifications, reservations or adverse
remarks.
Internal Auditors
M/s. Price Waterhouse Coopers, Chartered Accountants are the Internal Auditors of the
Company. The Internal Auditors carry out audit as per the audit plan defined by the Audit
Committee and regularly updates the committee on their internal audit findings at the
Committees meetings.
The Internal Auditors were satisfied with the management response on the observation
and recommendations made by them during the course of their audit and have expressed
satisfaction with the internal systems, controls and process followed by the Company.
Cost Auditors and Cost Records
Mr. K. Suryanarayanan, Cost Accountant (Membership No.24946) has carried out the Cost
Audit for the applicable business for the year under review.
Pursuant to the provisions of Section 148(3) of the Companies Act, 2013, the Board of
Directors had appointed Mr. K. Suryanarayanan, Cost Accountant (Membership No.24946) as
Cost Auditor of the Company for the financial year 2022-23. Proposal for ratification of
remuneration of the Cost Auditor is placed before the shareholders.
The company is maintaining cost records as specified under sub-section (1) of section
148 of the Companies Act, 2013.
Reporting of Frauds by Auditor
During the year under review, neither the Statutory Auditors nor the Internal Auditors
has reported to the Audit committee under Section 143(12) of the Companies Act 2013, any
instances or fraud committed against the company by its officers or employees, the details
of which need to be mentioned in the Boards report.
21. INTERNAL FINANCIAL CONTROLS
The Company has in place well defined and adequate framework for Internal Financial
Controls ("IFC") as required under Section 134 (5) (e) of the Companies Act,
2013.
During the year under review, such controls were tested and no material weaknesses in
their design or operations were observed.
22. OTHER DISCLOSURES
Nature of Business of the Company
There has been no change in the nature of business of the Company during the year under
review.
Public Deposits
The Company did not accept any deposits within the meaning of provisions of Chapter V -
Acceptance of Deposits by Companies of the Companies Act, 2013 read with the Companies
(Acceptance of Deposits) Rules, 2014.
Vigil Mechanism / Whistle Blower Policy
The Company in compliance with Section 177 of the Companies Act, 2013 and Regulation 22
of Listing
Regulations has established a Whistle Blower Policy in place as part of its vigil
mechanism. The policy provides appropriate avenues to the directors, employees and
stakeholders of the Company to make protected disclosures in relation to the matters
concerning the Company. Protected disclosures are appropriately dealt with by the Whistle
Officer or the Chairman of the Audit Committee. The policy is also available on the
Companys website at https:// solara.co.in/wp-content/uploads/2021/03/Solara
Whistle%20Blower%20Policy.pdf
Policy on Directors Appointment and Remuneration
The policy of the Company on Directors appointment and remuneration, including the
criteria for determining qualifications, positive attributes, independence of a director
and other matters, as required under Section 178 of the Companies Act, 2013 is available
on the Companys website at https://solara.co.in/wp-content/uploads/2020/10/ Solara
Nomination Remuneration-Policy.pdf
Insurance
The assets/ properties of the Company are adequately insured against loss due to fire,
riots, earthquake, terrorism, etc., and against other perils that are considered necessary
by the management.
Annual Return
Pursuant to Section 92 of the Companies Act, 2013 and the rules made thereunder, Annual
Returns filed by the Company for the prior financial years has been uploaded on the
website of the Company and can be accessed at https://solara.co.in/investor-
relations/annual-return/
Draft Annual Return for the financial year ended March 31, 2023, is also uploaded in
the above section. Upon filing the same with Registrar of Companies, filed return shall be
uploaded.
Secretarial standards issued by the Institute of Company Secretaries of India (ICSI)
The Directors state that the applicable Secretarial Standards have been followed during
the Financial Year 2022-23.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
Particulars in respect of conservation of energy, technology absorption and foreign
exchange
earnings and outgo as required under section 134 of the Companies Act, 2013, read with
Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached as Annexure - 3 to this
Report.
Disclosure under the Sexual harassment of woman at workplace (Prevention, Prohibition
and Redressal) Act, 2013
The company has put in place an anti-sexual harassment mechanism in line with the
requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition
& Redressal) Act, 2013. Internal Complaints Committee have been set up to redress
complaints received regarding sexual harassment. All employees (permanent, contractual,
temporary, trainees) are covered under this policy. The Company has not received any
complaint of sexual harassment during the year 2022-23.
23. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act, 2013 the Directors
of your Company confirm that:
a) in the preparation of the Annual Accounts, the applicable accounting standards had
been followed along with proper explanation relating to material departures.
b) they have selected such accounting policies and applied them consistently and made
judgements 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 or loss of the company for that period;
c) they have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the company and for preventing and detecting fraud and other irregularities.
d) they have prepared the annual accounts on a going concern basis
e) they have laid down internal financial controls to be followed by the Company and
that such internal financial controls are adequate and operating properly; and
f) they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems were adequate and operating effectively.
24. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
As stipulated under the Listing Regulations, the Business Responsibility and
Sustainability Report (BRSR) describing the initiatives taken by the company from
environmental, social and governance perspective is provided separately and forms integral
part of this Annual Report. BRSR as a part of Annual Report is available on the companys
website.
25. CAUTIONARY STATEMENT
Statements in the Annual Report, particularly those that relate to Management
Discussion and Analysis, describing the Companys objectives, projections, estimates and
expectations, may constitute ‘forward-looking statements within the meaning of
applicable laws and regulations. Although the
expectations are based on reasonable assumptions, the actual results might differ.
26. ACKNOWLEDGEMENT
Your directors would like to express their grateful appreciation for the assistance and
co-operation received from the Banks during the year under review. Your directors also
place on record their deep sense of appreciation for the continued support of customers,
suppliers, employees, and investors of the company.
For and on behalf of Board of Directors
|
Jitesh Devendra |
S. Hariharan |
|
Managing Director |
Executive Director |
Place: Bengaluru |
DIN:06469234 |
& CFO |
Date: May 12, 2023 |
|
DIN: 05297969 |
+91-9892691696
