Zim Laboratories Ltd Directors Report.

The Board of Directors of your Company has pleasure in presenting the Board Report pursuant to Section 134(3) of the Companies Act, 2013 comprising the prescribed particulars and information as per the Companies (Management and Administration) Rules, 2014 and Companies Accounts Rules, 2014 in respect of year ended 31.03.2020 as follows:-

a) Number of Meetings of the Board : 08

b) Directors Responsibility Statement-

Pursuant to Section 134(5) of the Companies Act, 2013 (Act) your Directors hereby state 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) the directors had 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) the directors had 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) the directors had prepared the annual accounts on a going concern basis ;

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

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

c) Declaration by Independent Directors under Sub Section 6 of Section 149 :-

The Company has received necessary declarations from each Independent Director under section 149(7) of the Companies Act, 2013 and Regulation 16(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

d) Nomination and Remuneration Policy:-

The Composition of Nomination and Remuneration Committee is as follows :

i) Dr. V. V. Parashar - Chairman.

ii) Dr. Naresh Gaikwad

iii) Mrs. Kavita Loya

iv) Dr. Anwar Siraj Daud, Chairman of the Board.

The criteria laid down in the Companies Act, 2013 and Rules framed there-under are complied with while appointing the Directors particularly Independent Directors. The Nomination and Remuneration Policy has been formulated and approved by the Nomination and Remuneration Committee, Placed as Annexure IV.

e) Explanations or comments on qualification/reservation/adverse remark/disclaimer made by :-

1. Statutory Auditor - Not applicable since there is no comment or qualification.

2. Secretarial Auditor - Not applicable since there is no comment or qualification.

f) Particulars of loans, guarantees or investments under Section 186

a) Loan : NIL
b) Guarantee : NIL
c) Investment : Rs 354.09 Lakhs

g) Particulars of contracts or arrangements with Related parties pursuant to Section 188(1)

During the year, no transaction with related parties was in conflict with the interests of the Company. All transactions entered into by the Company with related parties during the financial year were in the ordinary course of business and at an arms length basis. Statements of transactions with related parties are periodically placed before the Audit Committee and are approved by the committee. Particulars of contracts or arrangements with related parties referred to in Section 188 (1) of the Companies Act, 2013, in the prescribed Form AOC - 2, is appended herewith as Annexure V to the Boards Report.

h) The state of Companys affairs

This part has been covered under Management Discussion & Analysis Report

i) The amount proposed to be carried to reserve : NIL
j) The amount of dividend payment recommended : NIL
k) Material changes and commitments, if any affecting the financial position of the company which have occurred between the end of the financial year and the date of the report. : NIL

l) Conservation of energy, technology absorption, foreign exchange earnings and outgo :-

A. Conservation of energy :

(i) The steps taken or impact on conservation of energy;

Your company is striving continuously to conserve every form of energy by adopting innovative measures to reduce wastage and optimize consumption. Notable measures for energy conservation were as follows:

• Electrical light fixtures have been changed to LED/Induction fixtures.

• Lights have been converted to day-night sensors for auto ON/OFF.

• Lights within the factory premises have been shifted to motion/presence sensor for auto ON/OFF.

• All lightings of the Packing Material (PM) warehouse have been shifted to an on-grid solar system.

• Air Conditioners have been put on auto control synchronization for energy saving.

(ii) The steps taken by the Company for utilizing alternate sources of energy; The PM warehouse have been shifted to an on-grid solar system in place of conventional power source from MSEB.

(iii) The capital investment on energy conservation equipments ; 0.63 Lakhs

B. Technology Absorption: -

i) The efforts made towards technology absorption: 1) The inclusion of Fluid Bed Processor (from Glatt) will significantly improve the process timing which will improve the yield of the products.
2) 15 products are being developed under codevelopment projects for emerging markets.
3) Research is underway for development, evaluation and standardization of solid oral dosage forms such as pellets/MUPs, DC granules, taste masked granules and orally disintegrating strips for gastrointestinal, cardiovascular and urological disorders apart from antibiotics.
ii) The benefits derived like product improvement, cost reduction, product development or import substitution The above efforts helped to maintain relevance with existing clients and offer them value added products. Value was created by offering evaluation of ZIMs product against the innovator product analytical data package, stability data package and clinical data package.
To mitigate the risk of sourcing API for top selling products, initiatives on alternate vendor qualification were also undertaken during the year.
Alternate vendor development was initiated to mitigate cost fluctuations, risk of uninterrupted supply and the risk of sourcing API and excipients for top products.
iii) In case of imported technology (imported during the last 3 years reckoned from the beginning of the financial year):
a. The details of technology imported Cartonator for Secondary Packing of the products.
b. The year of import FY 2019-20
c. Whether the technology has been fully absorbed Yes
d. If not fully absorbed, areas where absorption has not taken place, and the reasons there of. Not applicable
iv) The expenditure incurred on Research and Development Revenue expenses Rs.,451.73 lakhs
Capital expenses Rs 70.72 lakhs


C) Foreign Exchange earnings and outgo :
i) Foreign exchange earned during the year : Rs 16,967.52 Lakhs
ii) Expenditure in foreign exchange : Rs 1,280.00 Lakhs

m) Risk Management Policy :

This part has been covered under Management Discussion & Analysis Report.

n) Corporate Social Responsibility (CSR)

The Composition of Corporate Social responsibility Committee is as follows :

(i) Mr. Suprakash Chakravarty - Chairman.

(ii) Mr. Padmakar S. Joshi

(iii) Dr. Anwar Siraj Daud

(iv) Mr. Zulfiquar M. Kamal

The policy approved by the Board is as follows:-

1 Major project to be implemented in phases, in a period of 5 to 10 years 60% to 70%
2 Sanitation and water supply 5% to 10%
3 Educational and vocational skill development activities 5% to 10%
4 Contribution to other organizations engaged in activities covered under notified CSR projects 5% to 10%