Vikram Thermo (India) Ltd Management Discussions.

1. OVERALL REVIEW ON INDUSTRY STRUCTURE & DEVELOPMENTS:

The Company is in Pharmaceutical industry. The Company is leading in manufacturing and selling of basic Pharma CoPolymer ‘Drug Coat, ‘ Diphenyl Oxide,etc.

The Company is a dynamic futuristic public limited company involved in manufacturing, marketing and export of pharmaceutical excipients and chemicals since 1985. The Company owns three well established brands DRUGCOAT & DRCOAT and DPO-Diphenyl oxide. The overall performance during the financial year 2019-20 has beenprogressive.

CREDENTIALS:

The Company is having EXCIPACT, Good Manufacturing Practice, ISO 9001:2008 and Halal certificate and many multinational company audit approval enabling pharmacopeial GMP quality product manufacturing in India. Vikram Thermo (India) Limited also filed US-DMF for its products.

RESEARCH & DEVELOPMENTS:

The Companyhave strong R&D and Application F&D team, with vast experienced and qualified pharmacists, research scientist, chemist & chemical engineers to develop various polymers in pharmaceutical & cosmetic applications.

INFRASTRUCTURE:

Vikram Thermo (India) Limited have dedicated plant at two different locations for manufacturing Aromatic Chemical and EXCIPACT GMP standard pharma polymers.

2. OPPORTUNITIES AND THREATS: Opportunities

• India has a long tradition of chemical activities and a very strong Pharmaceutical Industry which is growing at rapid pace which shall directly help the Companys revenue to grow in foreseeable future.

• India has abundant supply of highly skilled manpower, scientists and technical personnel for which the salaries are considerably lower than the same in developed nations.

• The capital cost for setting up a decent world class facility is fraction of what it would cost in Western Countries. This makes the Indian Companies at the competitive position in the international markets.

Threats

• Import of goods from some of the large global sized plants may add to the competition for the Companys Products.

3. SEGMENT–WISE OR PRODUCT-WISE PERFORMANCE:

On the basis of the principles for determination of segments given in Indian Accounting Standard 108 "Operating Segments " and in the opinion of management, the Company is primarily engaged in the business of manufacturing of "Chemicals". All other activities of the Company revolve around the main business and as such there is no separate reportable business segment. However, the company has identified geographical segment as its secondary business segment, the details are as follows:

Particulars India Rest of the world Total
2019-20 2018-19 2019-20 2018-19 2019-20 2018-19
Segment Revenue 44,56,36,860 46,26,02,034 11,28,68,727 11,97,92,793 55,85,05,587 58,23,94,827
Segment Assets 41,47,04,890 34,70,88,012 Nil Nil 41,47,04,890 34,70,88,012
Additions to Property, Plant & Equipments including intangible Assets 2,46,41,410 5,72,99,898 Nil Nil 2,46,41,410 5,72,99,898

There is no transaction with single customer which amounts to 10% or more of the Companys revenue.

4. BUSINESS OUTLOOK:

The Company has achieved polymer excellence by Discovery, Development, Manufacturing and Marketing of research based products since last three decades this POLYMER EXCELLENCE Led Ready -To-Use Coating System – DRCOAT. The Company provides complete solution for various applications in solid oral dosage coating segment with complimentary technical support.

The Companyhave both range of products basic pharma polymers as well as readymix coating products.

5. RISK AND CONCERN:

The companys raw materials are based on petrochemicals. Major fluctuations in the petroleum products can affect the companys performance.

6. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY:

Considering the size of the company, your company has adequate system of internal control to provide reasonable assurance that assets are safeguarded and protected from unauthorized use or deposition. The management continuously reviews the internal control systems and procedure for efficient conduct of business. A strong system of internal audit committee of the Board has strengthened the internal control within the organization.

7. FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE.

Total turnover for the year ended on 31st March, 2020 was Rs. 5585.05lacs.It was mainly on account of improvement in manufacturing techniques and sales promotion drive. Better working capital management was also one of the emphasis on which proper weight age was laid upon.

8. HUMAN RESOURCE DEVELOPMENT:

Your Company treats its "Human Resources" as one of its most significant assets. The Company continues its focus on retention through employee engagement initiatives and provides a holistic environment where employees get opportunities to realize their potential. A number of programs that provide focused people attention are currently underway. Your Companys thrust is on the promotion of talent internally through job rotation and job enlargement. The Companys Health and Safety Policy commits to provide a healthy and safe work environment to all employees.

9. DETAILS OF SIGNIFICANT CHANGES (I.E. CHANGE OF 25% OR MORE AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR) IN KEY FINANCIAL RATIOS, ALONG WITH DETAILED EXPLANATIONS THEREFOR, INCLUDING:

Ratio 2019-20 2018-19
Debtors Turnover 35.84 38.63
Inventory Turnover 13.43 9.07
Interest Coverage Ratio 9.07 3.88
Current Ratio 2.40 2.1
Debt Equity Ratio 0.06 0.14
Operating Profit Margin (%) 20.46% 13.70%
Net Profit Margin (%) 12.96% 7.60%

The operating profit margins as well as net profit margins for the current fiscal have substantially improved compared to previous fiscal on account of improved product realizations, reduction in input prices and better capacity utilization.

10. DETAILS OF ANY CHANGE IN RETURN ON NET WORTH AS COMPARED TO THE IMMEDIATELY PREVIOUS FINANCIAL YEAR ALONG WITH A DETAILED EXPLANATION THEREOF

The return on net worth during the current financial year was 13.27% compared to 10.32% achieved during the previous financial year. The improvement was on account of increased profitability of the company.

11. BUSINESS ENVIRONMENT:

The Performance of the company for the year under review was satisfactory.

12. CAUTIONARY STATEMENT:

Statements in this report on Management Discussion and analysis may be forward looking statements within the meaning of applicable security laws or regulations. These statements are based on certain assumptions and expectations of future events. Actual results could however, differ materially from those expressed or implied. Important factors that could make a different to the Companys operations include global and domestic demand supply conditions, finished goods prices, raw material cost and availability and changes in government regulation and tax structure, economic development within India and the countries with which the company has business contacts and other factors such as litigation and industrial relations.The Company assumes no responsibilities in respect of forward looking statements which may be amended or modified in future on the basis of subsequent developments, information of event.

PLACE : AHMEDABAD BY THE ORDER OF THE BOARD OF DIRECTORS,
DATE : 14/08/2020 FOR, VIKRAM THERMO (INDIA) LIMITED
DR. C. K. PATEL
CHAIRMAN & WTD
(DIN:00044241)

CEO / CFO CERTIFICATION

To,

The Board of Directors,

VIKRAM THERMO (INDIA) LIMITED

AHMEDABAD

We, MR.DHIRAJLAL K PATEL,

Managing Director and MR. MOTIBHAI D. FOSI, CFO of the VIKRAM THERMO (INDIA) LIMITED certify that:

1. We have reviewed the financial statements for the year 2019-20and that to the best of my knowledge and belief:

a. These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading.

b. These statements give a true and fair view of the state of affairs of the company and of the results of operations and cash flows. The financial statements have been prepared in conformity, in all material respects, with the Indian Accounting Standards, applicable laws and regulations.

2. These are, to the best of our knowledge and belief, no transactions entered into by the company during the year which are fraudulent, illegal or violative of the companys code of conduct.

3. We accept overall responsibility for the companys internal control system and financial reporting. This is monitored by the internal audit function, which encompasses the examination and evaluation of the adequacy and effectiveness.

Internal audit works with all the levels of management and statutory auditors and reports significant issues to the Audit Committee of the Board. The auditors and audit committee are apprised of any corrective action taken with regard to significant deficiencies and material weakness.

4. We indicate to the auditors and to the audit committee:

a. Significant changes in internal control over financial reporting during the year.

b. Significant changes in accounting policies during the year;

c. Instances of significant fraud of which we have become aware of and which involve management or other employees who have significant role in the companys internal control system over financial reporting.

However, during the year there were no such changes or instances.

DECLARATION BY THE MANAGING DIRECTOR ABOUT CORPORATE GOVERNANCE

I, MR. Dhirajlal K Patel, Managing Director of VIKRAM THERMO (INDIA) LIMITEDhereby confirm pursuant to Regulation 26(3) and PART D of Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 that:

1. The Board of Directors ofVIKRAM THERMO (INDIA) LIMITED has laid down a code of conduct has been placed on the companys website.

2. All the members of the board as well as senior management personal have complied with the said code of conduct for the year ended 31st March 2020.

CERTIFICATE OF COMPLAINCE WITH CORPORATE GOVERNANCE

To,

The Members of

VIKRAM THERMO (INDIA) LIMITED

We have examined the compliance of the conditions of Corporate Governance by M/S.VIKRAM THERMO (INDIA) LIMITED (‘the Company) for the year ended March 31, 2020 as stipulated in Regulations 17 to 27 and clauses (b) to (i) of regulation 46 (2) and paragraphs C, D and E of Schedule V of the SEBI (Listing Obligation and Disclosure Requirement) Regulations, 2015.

Managements Responsibility:

The compliance of conditions of Corporate Governance is the responsibility of the management of the Company including the preparation and maintenance of all relevant supporting records and documents.

Our Responsibility:

Our examination was limited to review of procedures and implementation thereof adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

Pursuant to the requirements of the Listing Regulations, it is our responsibility to provide a reasonable assurance whether the Company has complied with the conditions of Corporate Governance as stipulated in Listing Regulations for the year ended on 31st March, 2020.

Opinion:

In our opinion and to the best of our information and explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated Listing Agreement and SEBI (Listing Obligation & Disclosure Requirement) Regulation, 2015.

We further state that such compliance is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.

CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS

 

(pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015)

To,

The Members of

M/S. VIKRAM THERMO (INDIA) LIMITED A/704-714 THE CAPITAL SCIENCE CITY ROAD AHMEDABAD GJ 380060 IN

We, M/S. A. SHAH & ASSOCIATES, Practicing Company Secretaries, have examined the relevant registers, records, forms, returns and disclosures received from the Directors of M/S.VIKRAM THERMO (INDIA)LIMITED having CIN -

L24296GJ1994PLC021524and having registered office at A/704-714 THE CAPITAL SCIENCE CITY ROAD AHMEDABADGJ 380060 IN(hereinafter referred to as ‘the Company), produced before us by the Company for the purpose of issuing this Certificate, in accordance with Regulation 34(3) read with Schedule V Para-C Sub clause 10(i) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In our opinion and to the best of our information and according to the verifications (including Directors Identification Number (DIN) status at the portal www.mca.gov.in) as considered necessary and explanations furnished to us by the Company & its officers, We hereby certify that none of the Directors on the Board of the Company as stated below for the Financial Year ending on 31st March, 2020 have been debarred or disqualified from being appointed or continuing as Directors of companies by the Securities and Exchange Board of India, Ministry of Corporate Affairs or any such other Statutory Authority.

Sr. No. Name of Director DIN Date of appointment in Company
1 CHIMAHBHAI KHODABHAI PATEL 00044241 26/09/1994
2 DHIRAJLAL KARSANBHAI PATEL 00044350 26/09/2009
3 BHARATBHAI MANUBHAI SHAH 00044460 01/05/2003
4 VIPULKUMARVITTHALBHAI PATEL 03056403 15/05/2019
5 THAKARSHIBHAI MAGANLAL PATEL 00044557 25/03/2005
6 KETAN CHIMANLAL PATEL 00064185 01/05/2003
7 DINESHKUMAR HARJIVANBHAI PATEL 02583348 31/03/2009
8 ALPABEN ALPESHBHAI PATEL 06950180 14/08/2014
9 ANKUR DHIRAJLAL PATEL 07395218 09/02/2016
10 SHAILESHKUMAR PRAHLADBHAI PATEL 07395238 09/02/2016

Ensuring the eligibility of for the appointment / continuity of every Director on the Board is the responsibility of the management of the Company. Our responsibility is to express an opinion on these based on our verification. This certificate is neither an assurance as to the future viability of the Company nor of the efficiency or effective ness with which the management has conducted the affairs of the Company.

PLACE: AHMEDABAD FOR, A. SHAH & ASSOCIATES
DATE: 15/06/2020 PRACTICING COMPANY SECRETARIES,
MR. ANISH SHAH
PROPRIETOR
FCS NO: 4713
CP NO: 6560
(UDIN:F004713B000341951)