Zota Health Care Ltd Directors Report.

Your directors are glad to present the Annual Report of the Company, accompanying the Audited statement of Accounts for the financial year ended March 31, 2021.

CORPORATE INFORMATION

Our Company having been incorporated under the provisions of the Companies Act, 1956 and having the permanence presence in India since the year 2000. The Companys business vertices includes Manufacturing, Trading and Export of the Pharmaceutical Products. The Company caters both the domestic and the international markets.

FINANCIAL RESULTS

Standalone

Consolidated

For the year Ended 31-03-2021 % For the year Ended 31-03-2020 For the year Ended 31-03-2021 % For the year Ended 31-03-2020
Revenue from operations 10684.12 9511.27 10678.92 9511.27
Other Income 125.66 151.30 125.97 151.30
Profit/ (loss) before tax and Exceptional Items (134.42) 388.02 (139.42) 386.16
Exceptional Items 102.88 - 102.88 -
Profit/ (loss) before Taxation (31.54) 388.02 (36.54) 386.16
Income Tax 1.55 105.61 1.55 105.61
Deferred Tax (16.85) 6.40 (17.20) 6.40
Profit after Taxation (16.24) 276.01 (20.89) 274.15

DIVIDEND

The Board of Directors are gratified to recommend the final dividend at the rate of 10% i.e. .1/- per equity share for the financial year 2020-21. In view of the loss registered in the financial year 2020-21; the dividend shall be paid out of accumulated profits of the Company. The dividend will be paid to all the entitled members within the time frame as specified in the Companies Act, 2013; if the same be approved in this Annual General Meeting.

INVESTOR EDUCATION AND PROTECTION FUND:

During the financial year ended March 31, 2021; the Company has transferred 2180/- to the Investor and Education Protection Fund (‘IEPF) in respect of the unclaimed dividend of Company for financial year 2012-13. Further, there were no shares on which dividend has been unclaimed/unpaid for seven consecutive years; hence no shares were liable to be transferred to the IEPF Authority.

TRANSFER TO RESERVE

Considering the financial position of the company; company has not transferred any amount to its General Reserve for the financial year 2020-21.

STATEMENT OF COMPANYS AFFAIRS

The Revenues from operations in financial year 2020-21 grew by 12.33% YoY driven by higher revenue growth of Davaindia and Export business. During the year, Revenues from Davaindia has been grew by 98.38% YoY and Revenues from Export business has been grew by 53.22% on YoY basis. This is in line with Companys strategy of increasing overall Revenue contribution from new-age businesses, and reducing dependence on Domestic marketing.

During the year, EBITDA stood at 193.23 lakhs and PAT stood at -16.24 lakhs lakhs due to higher operational expenses on account of aggressive expansion of Davaindia operations. Performance of various business verticals of the Company during financial year 2020-21 is as below:

DOMESTIC BUSINESS*:-

• In FY 21 domestic Revenue was up by 1.52% on YoY basis at

7636.67 lakhs.

• EBITDA at -348.13 Lakhs due to high operational expenses of Davaindia.

• P AT -369.75 lakhs in FY21.at

*Domestic revenue includes revenue of DAVAINDIA.

EXPORT BUSINESS:

• Exports Revenues grew 53.22% at 3047.45 Lakhs in FY21 with better utilisations and export to newer countries in FY21.

• EBITDA at 541.36 lakhs with healthy margins of 17.76%.

• P AT grew 33.64% on YoY basis 353.51 lakhs for FY21.at

DAVAINDIA:

• During the FY21 Revenues from Davaindia operations has been grew 98.38% on YoY at 2407.18 lakhs.

• The managements focus on Davaindia expansions has been as anticipated, during the year the Company has added more 339 Davaindia stores with the total store count to 591 as at March 31, 2021 covering 24 states of India.

• Dav aindia has catered more than 3.07 million customers till March 31, 2021; this shown the strong presence of the Company in Generic Medicine space.

• A higher number of ~ 1,432 SKUs with around Private Label Products has enabled Davaindia to better serve customers across all segments.

• The company has adopted various marketing and communication channels like print, T.V and other mediums to increase top of the mind brand recall in the minds of the customers. This exercise that begun to gain traction and has witnessed wallet share increase among its users. Thus increasing its customer spends across varied price points, the average wallet spends was ~ 190 during the FY21.

COVID-19 IMPACT ON BUSINESS

The Company has considered the possible effects that may result from COVID-19 in the preparation of these Standalone financial results including the recoverability of carrying amounts of financial and non-financial assets. Based on the current years performance and estimates arrived at using internal and external sources of information, the company does not expect any material impact on such carrying values. The impact of COVID-19 on the companys financial statement may differ from that estimated as at the date of approval of this report and it will continue to closely monitor any material changes to future economic conditions.

MATERIAL CHANGES FROM THE END OF THE FINANCIAL YEAR

The continuous outbreak of COVID-19 pandemic is disrupting the economic activities in India and globally. Being fall under the essential commodities, the operation of the Company have been impacted minimally due to COVID-19.

After the financial year, the Board of directors in its meeting held on August 11, 2021 has recommended the following happy business items for the approval of members in ensuing Extraordinary General meeting of the Company:

I. Incr ease of Authorised Share Capital of the Company of from existing 25,00,00,000/- (Rupees Twenty Five Crores Only) divided into 2,50,00,000 (Two Crores Fifty Lakhs) equity shares of face value of 10.00/- (Rupees Ten Only) each to 30,00,00,000/- (Rupees Thirty Crores Only) divided into 3,00,00,000 (Three Crores) equity shares of face value of 10.00/- (Rupees Ten Only) each by creation of additional 50,00,000 (Fifty Lakhs) equity shares of face value of 10.00/-(Rupees Ten Only) each ranking pari passu in all respect with the existing equity shares of the Company

II. Issuance of up to 6,00,000 (Six lakhs) Equity Shares having face value of 10.00/- (Rupees Ten Only) each, on preferential basis to persons belonging to the non – promoter group category of the company at a price of 280.00/- (Two Hundred Eighty Only) including the premium of 270.00/- (Two Hundred Seventy only) per Equity Share.

Apart from this there are no Material changes occurred between the end of the financial year of the company to which the financial statements related and the date of the report, which is affecting the financial position of the company.

ANNUAL RETURN

The draft of the Annual Return as required under Section 92(3) of the Companies Act, 2013 and Rule 12 (1) of the Companies (Management and Administration) Rules, 2014 in Form MGT-7is available on the Companys website viz. www.zotahealthcare. com

COMMENTS ON AUDITORS REPORT

The notes referred to in the Auditors Report are self-explanatory and they do not call for any further explanation, as required under Section 134 of the Companies Act, 2013.

DETAILS OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of the Company comprises of ten (10) directors; one Non-Executive Chairman, one Managing Director, three Whole-time Directors and remaining five being the Independent Directors. As on the date of this report, the composition of the Board of the company as follows:

Name of Directors Category & Designation
Mr. Ketankumar Chandulal Zota Non-Executive Chairman
Mr. Moxesh Ketanbhai Zota Executive Managing Director
Mr. Himanshu Muktilal Zota Executive Whole-time Director
Mr. Manukant Chandulal Zota Executive Whole-time Director
Mr. Kamlesh Rajanikant Zota Executive Whole-time Director
Mrs. Varshabahen Gaurang Mehta Non-Executive Independent Director
Mrs. Bhumi Maulik Doshi Non-Executive Independent Director
Mr. Vitrag Sureshkumar Modi Non-Executive Independent Director
Mr. Dhiren Prafulbhai Shah Non-Executive Independent Director
Mrs. Jayshreeben Nileshkumar Mehta Non-Executive Independent Director

Pursuant to Sections 149, 152 and other applicable provisions of the Companies Act, 2013, one-third of the directors of the company are liable to retire by rotation, and if eligible, they can offer themselves for the re-appointment. In this Annual General Meeting Mr. Kamlesh Rajanikant Zota, Whole-time Director of the Company is liable to retire by rotation and being eligible to offer himself for re-appointment.

Pursuant to the provisions of Section 149, 150, read with schedule IV and any other applicable provisions of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014, applicable regulations of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time (including any statutory modifications or re-enactment thereof for the time being in force), and any other applicable laws, Board be and hereby recommending the Re- appointment of Mrs. Varshabahen Gaurang Mehta as the Non – Executive Independent director of the Company for a further term of 5 (five) years.

Pursuant to the provisions of Section 196, 197, 198, 203 read with schedule V and any other applicable provisions of the Companies Act, 2013 read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, applicable Regulation 17(6)(e) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended from time to time (including any statutory modifications or re-enactment thereof for the time being in force), and any other applicable laws, Board be and hereby recommending the Re- appointment of Mr. Moxesh Ketanbhai Zota as the Managing Director of the Company for a further term of 5 (five) years.

As per Section 2(51) and 203 of the Companies Act, 2013; the Key Managerial Personnel (KMP) of the Company are as follows:

Name of Directors Category & Designation
Mr. Moxesh Ketanbhai Zota Managing Director
Mr. Himanshu Muktilal Zota Whole-time Director
Mr. Manukant Chandulal Zota Whole-time Director
Mr. Kamlesh Rajanikant Zota Whole-time Director
Mr. Viral Mandviwala Chief Financial Officer
Mr. Ashvin Variya Company Secretary

MEETING OF THE BOARD OF DIRECTORS:

The Board of Directors of the company have met Five (5) times during the year. Details of the same are stated as below:

Sr. No. Date of Meeting Board Strength No. of Director Present
1 23/06/2020 10 10
2 25/08/2020 10 10
3 11/11/2020 10 10
4 10/02/2021 10 10
5 09/03/2021 10 10

DEPOSITS

During the year, the Company has not accepted any deposits from public within the meaning of the Section 73 of the Companies Act, 2013.

RELATED PARTY TRANSACTION

With reference to Section 134(3)(h) of the Companies Act, 2013, all contracts and arrangements with related parties under Section 188 of the Companies Act, 2013 read with Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015; entered by the Company during the financial year, were in ordinary course of business and at arms length basis. Details of the related party transactions made during the year are attached as Annexure-1 in form AOC-2 for your kind perusal and information.

LOANS, GUARANTEES AND INVESTMENT

With reference to Section 134(3)(g) of the Companies Act, 2013; loans, guarantees and investments made by the company under Section 186 of the Companies Act, 2013 are as below:

Sr. No. Date of transaction Name of the Company Purpose of Transaction Amount involved in Transaction
1 Earlier year Prime Co-op. Bank Investment in equity shares 100
2 03/12/2019 DavaIndia Health Mart Limited Acquisition 1,000,000
3 16/02/2019 Zota Healthcare Nig. Ltd. * Acquisition 197,300
4 07/06/2018 Zota Healthcare Lanka (Pvt) Ltd Acquisition 86,680
5 10/02/2021 DavaIndia Health Mart Limited Loan 10,000,000

* Incorporation of Zota Healthcare Nig. Ltd. is under process.

CORPORATE SOCIAL RESPONSIBILITY

Since applicability of Corporate Social Responsibility, the Company has makes continuous endeavor to cover maximum programs/ initiatives for discharging the social responsibility. Over the years, under various Corporate Social Responsibility initiatives; the Company has mainly covered three main pillars of balanced social growth of the people that are Health, Education and Environment.

On the basis of receipt of recommendations from the Corporate Social Responsibility (‘CSR) Committee, the Board has framed the Corporate Social Responsibility Policy and adopted the same. The detailed CSR policy of the Company is available on the link: http://www.zotahealthcare.com/wp-content/uploads/2019/08/Corporate_Social_Responsibility_Policy.pdf

The company has carried out varied CSR activities during the financial year 2020-21, the details of the same are as per Annexure -2. Corporate Social Responsibility Committee of the Board has met two (2) times during the last year. Details of the CSR committee meetings are stated as below:

Sr. No. Date of Meeting Strength of Committee No. of Members Present
1 22/08/2020 3 3
2 19/02/2021 3 3

DECLARATION BY INDEPENDENT DIRECTORS

All the Independent Directors of the Company have given their duly signed declarations affirming that they met the criterias of independence as specified under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

IntheopinionofBoard,theIndependentDirectorsofthecompanypossesstheintegrity,requisiteexperienceandexpertise,relevant for the industry in which the company operates. All the Independent Directors of the Company have successfully registered with the Independent Directors Databank of the Indian Institute of Corporate Affairs. Apart from Mrs. Varshabahen Gaurang Mehta, Independent Director of the Company, who has got exemption from clearing the proficiency self- assessment test; the online proficiency self- assessment test as conducted by the said institute is yet to be passed by the remaining Independent Directors.

NOMINATION AND REMUNERATION COMMITTEE

Pursuant to the provisions of Section 178 of the Companies Act, 2013 read with Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015; the Company has formulated nomination and remuneration committee comprising of three non-executive independent directors Composition of the Committee is as follows:

Mrs. Varshabahen Gaurang Mehta - Chairman & Member
Mr. Dhiren Prafulbhai Shah - Member
Mr. Jayshreeben Nileshkumar Mehta - Member

During the year, one (1) meeting of the nomination and remuneration committee was held. Details of the Meetings are stated as below:

Sr. No. Date of Meeting Strength of Committee No. of Members Present
1 25/08/2020 3 3

Terms of Reference of the Committee

To identify persons who are qualified to become Directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal and shall carry out evaluation of every Directors performance.

To formulate the criteria for determining qualifications, positive attributes and independence of a Director and recommend to the Board a policy, relating to the remuneration for the Directors, Key Managerial Personnel and other employees.

The Nomination and Remuneration Committee shall, while formulating the policy ensure that:

• the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate Directors of the quality required to run the Company successfully;

• r elationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

• r emuneration to Directors, Key Managerial Personnel and senior management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals:

Regularly review the Human Resource function of the Company.

Discharge such other function(s) or exercise such power(s) as may be delegated to the Committee by the Board from time to time.

Make reports to the Board as appropriate.

Review and reassess the adequacy of this charter periodically and recommend any proposed changes to the Board for approval from time to time.

Any other work and policy, related and incidental to the objectives of the committee as per provisions of the Act and rules made there under.

Any other terms of reference as prescribed under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and under other applicable rules and regulations, if any.

POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION

Remuneration to Executive Directors:

The Board of Directors in its duly held meeting, after considering the recommendations received from Companys Nomination and Remuneration Committee, approve the remuneration to be payable to the executive directors of the Company. The remuneration of the executive directors is approved by considering varied norms like qualification, experience, responsibilities, value addition to the Company and financial position of the Company. The Board of Directors takes the permission of the members, if required, for payment of remuneration to the aforesaid directors.

Remuneration to Non-Executive Directors:

During the year, apart from sitting fees Company has not paid any remuneration to the Non-Executive and Independent Directors.

The detailed policy on directors appointment and remuneration is available on the below link: http://www. zotahealthcare.com/wp-content/uploads/2019/08/Policy_ on_Appointment_and_Remuneration_for_Directors_Key_ Managerial_Personnel_and_Senior_Management_Employee. pdf

AUDIT COMMITTEE:

Pursuant to requirement of Section 177(1) of the Companies Act, 2013 read with Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015; the Company has formulated Audit Committee. The composition of the Audit Committee as on date is as follows:

Mr. Vitrag Sureshkumar Modi - Chairman & Member
Mrs. Varshabahen Gaurang Mehta - Member
Mrs. Bhumi Maulik Doshi - Member
Mr. Himanshu Muktilal Zota - Member

During the year, Audit Committee has met four (4) times, details of the same are as stated below:

Sr. No. Date of Meeting Strength of Committee No. of Members Present
1 23/06/2020 4 4
2 25/08/2020 4 4
3 11/11/2020 4 4
4 10/02/2021 4 4

The Whole term of references of audit committee are to recommend for appointment of the Statutory Auditor, Internal Auditor and Chief Financial Officer, approve related party transactions, examination of financial statements and auditors report, scrutinize inter corporate loans and investments, evaluation of Internal Financial Control and Risk Management, review and monitor auditors independence and performance and effectiveness of audit process, review Internal Audit Reports, monitor and review compliances of the provisions of the SEBI (Prohibition of Insider Trading) Regulations, 2015, monitor and review the utilization of fund raised through IPO, FPO, Right Issue and Preferential Issues and any other terms of reference as prescribed under Companies Act, 2013, the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and under other applicable rules and regulations, if any.

STAKEHOLDERS RELATIONSHIP COMMITTEE

Pursuant to the provisions of Section 178 of the Companies Act, 2013 read with Regulation 20 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015; and to solve the investors grievances, the Company has formulated the Stakeholder Relationship Committee; the composition of the Committee is as follows:

Mr. Jayshreeben Nileshkumar Mehta - Chairman & Member
Mr. Manukant Chandulal Zota - Member
Mr. Himanshu Muktilal Zota - Member

During the year, Stakeholders Relationship Committee has met one (1) time, details of the meetings are as follows:

Sr. No. Date of Meeting Strength of Committee No. of Members Present
1 10/02/2021 3 3

VIGIL MECHANISM/ WHISTLE BLOWER

The Company has established a Vigil Mechanism & a Whistle Blower System to deal with instances of fraud and mismanagement, if any. The policy has a systematic mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct or policy. The detailed Whistle Blower Policy & Vigil Mechanism available on below link: http://www.zotahealthcare.com/wp-content/ uploads/2019/11/VIGIL_MECHANISM.pdf

RISK MANAGEMENT

Risks are events, situations or circumstances which may lead to negative consequences on the Companys business. Risk Management is a structured approach to manage uncertainty. An enterprise wide approach to Risk Management is being adopted by the Company and key risks will now be managed within a unitary framework. As a formal roll-out, all business divisions and corporate functions will embrace Risk Management Policy and Guidelines, and make use of these in their decision making. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews. The risk management process over the period of time will become embedded into the Companys business system and processes, such that our responses to risk remain current and dynamic.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, your directors hereby confirm:

A. That in preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departments;

B. That the directors 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 if the Company at the end of the financial year and of the profit and loss of the Company for that period;

C. That 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 for preventing and detecting fraud and other irregularities;

D. That the directors had prepared the annual accounts on a going concern basis;

E. The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively;

F. 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.

BOARD EVALUATION

The performance evaluation of the Board, its Committees and the Independent Directors of the company were evaluated by the Board after obtaining inputs from all the directors on the fixed benchmark for the performance evaluation such as participation in strategy formulation and decision making; participation in Board and Committee meetings; Directions, views and recommendations given to the Company, etc.

The Board reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the chairman was also evaluated on the key aspects of his role.

In a separate meeting of independent directors, performance of non-independent directors, performance of the board as a whole and performance of the chairman was evaluated, taking into account the views of executive directors and non-executive directors. The Performance evaluations of the Independent directors were done by the entire board, excluding the independent directors who were being evaluated did not participate in the same.

INTERNAL FINANCIAL CONTROL SYSTEM

The Company has a well-placed, proper and adequate internal financial control system which ensures that all the assets are safeguarded and protected and that the transactions are authorized recorded and reported correctly. The internal audit covers a wide variety of operational matters and ensures compliance with specific standard with regards to availability and suitability of policies and procedures. During the year no reportable material weakness in the design or operation were observed.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS

No significant and material orders were passed by the regulators or the courts or tribunals impacting the going concern status and Companys operations in future.

REPORTING OF FRAUD BY AUDITORS

During the year under review, neither the Statutory Auditor nor the Secretarial Auditor has reported to the Audit Committee any instances of fraud committed against the Company by its Officers or Employees; the details of the same would need to be mentioned, if any, in the Directors Report.

CORPORATE GOVERNANCE:

Your Company has incorporated the appropriate standards for the corporate governance. The Company has filed all the quarterly compliance reports on corporate governance within the due time line to the Stock Exchange, as specified in Regulation 27(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and all other Corporate Governance norms mentioned under the said regulation dully complied by the Company. Moreover, as per Regulation 34(3) read with Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 company gives the Corporate Governance Report in its Annual Report. Corporate Governance Report is as per Annexure -3.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING

With reference to Section 134(3) (m) of the Companies Act, 2013, the details of conservation of energy, technology absorption and foreign exchange earnings are as per

Annexure - 4.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report, as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is provided in a separate section and forms an essential part of this Report.

SECRETERIAL AUDITOR

Your Board has appointed the PCS Ranjit Binod Kejriwal, as Secretarial Auditor of the Company for the period of 5 consecutive years starting from financial year 2016-17. The Secretarial Audit Report for the financial year 2020-21, which has been received from the PCS Ranjit Binod Kejriwal is attached as Annexure - 5. Report of the Secretarial Auditor is self-explanatory and need not any further clarification.

COST AUDITOR

During the year, as per the provisions of Section 148(1) of the Companies Act, 2013, the Company has maintained and prepared the cost records. However, as the manufacturing unit of the Company is situated in Special Economic Zone, so the requirement of appointment of the Cost Auditor is not applicable to the Company.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

There was no employee drawing remuneration in excess of limits prescribed under 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. The Disclosure pertaining to remuneration as required under section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Amendment Rules, 2016 are as per Annexure - 6.

CEO/ CFO CERTIFICATION

In terms of Regulation 17(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015; the CFO has certified to the Board of Directors of the Company with regard to the financial statements and other matters specified in the said regulation for the financial year 2020-21. The certificate received from CFO is attached herewith as per Annexure – 7.

CODE OF CONDUCT

The Board of Directors has formulated and adopted the Code of Conduct for Board of Directors and Senior Management Personnel from May 30, 2018. During the year, Board of Directors and Senior Management Personnel has complied with general duties, rules, acts and regulations. In this regard the Board has received a certificate from the Managing Directors as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015; the same is attached herewith as per Annexure – 8.

Code of Conduct for Board of Directors and Senior Management Personnel being effective from May 30, 2018 is available on below link: http://www.zotahealthcare.com/wp-content/uploads/2019/08/Code_of_Conduct_for_Board_ Members_and_Senior_Management_Personnel.pdf

CERTIFICATE ON CORPORATE GOVERNANCE

Corporate Governance is a set of process, practice and system which ensure that the Company is managed in a best interest of stakeholders. The key fundamental principles of corporate governance are transparency and accountability. At Zota, Companys core business objective is to achieve growth with transparency, accountability and with independency. Company has adopted various corporate governance standard and doing business in ethical way by which Company has enhance stakeholders trust, shareholders wealth creation by improving shares valuation, market capitalization, etc.

A certificate received from M/s Shivangi Parekh & Co., Chartered Accountants, Statutory Auditors of the Company regarding compliance of the conditions of Corporate Governance, as required under Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is attached herewith as per Annexure – 9.

SHARE CAPITAL

During the year the Company has not issued any shares including shares with different rights, sweat equity shares or employee stock options. As on the date of this report the paid up Share Capital of the Company stood at 24.56 crores.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATE COMPANIES

During the year, no Company has become Subsidiary, Joint Venture and Associate Company of the Company and no Company has ceased as the Subsidiary, Joint Venture and Associate Company of the Company.

As at March 31, 2021; The Company has two Wholly Owned Subsidiary Companies as below:

1) M/ s Zota Healthcare Lanka (Pvt) Ltd (incorporated in Sri Lanka)

2) M/ s DavaIndia Health Mart Limited

PERFORMANCE OF SUBSIDIARY COMPANIES Zota Healthcare Lanka (Pvt) Ltd

During the year under review Zota Healthcare Lanka (Pvt) Ltd has not commenced any commercial operations in Sri Lanka and the financial performance of the same are as below:

Particulars Amount (Rs. in Lakhs)
total assets 0.53
total revenues NIL
total net loss 0.14

Davaindia Health Mart Limited

Davaindia Health Mart Limited (WOS) is engaged in the business of retail trading of pharmaceutical, nutraceutical, OTC, ayurvedic and cosmetic products. For the business purpose as stated above, the WOS has launched the Company Owned Company Operated (COCO) stores of Davaindia – a retail generic pharmacy chain. The financial performance of the WOS for the financial year ended March 31, 2021 are as below:

Particulars Amount (Rs. in Lakhs)
total assets 23.32
total revenues 1.56
total net loss 4.50

CONSOLIDATED FINANCIAL STATEMENTS

The Statutory Auditor of the Company have provided the Consolidated Financial Statements of the company and the same is forming a part of this Report. The Consolidated Financial Statements includes financial statements of the following companies:

M/s Zota Health Care Limited – Parent Company

M/s Zota Healthcare Lanka (Pvt) Ltd – Wholly Owned Subsidiary Company M/s Davaindia Health Mart Limited – Wholly Owned Subsidiary Company

Pursuant to Section 129(3) of the Companies Act, 2013 read with Rule 5 of the Companies (Accounts) Rules, 2014, a statement containing salient features of the financial statements of Subsidiaries is given in Form AOC-1 which forms an essential part of this Report and is attached herewith as per Annexure – 10.

MATERIAL SUBSIDIARY

The Company has formulated the Policy on Material Subsidiary, indicating therein the threshold limit of Material Subsidiary as specified under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the year, the Company does not have any Material Subsidiary. The Policy on Material Subsidiary is available on the Companys website and can be accessed from following link: http://www.zotahealthcare.com/wp-content/uploads/2019/08/Policy_on_Material_Subsidiary. pdf

BUSINESS RESPONSIBILITY REPORT

As stipulated under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility Report describing the initiatives taken by the Company from an environmental, social and governance perspective is attached as a part of the Annual Report as an Annexure – 11

SEXUAL HARASSMENT OF WOMEN

The constitution of the Internal Complaints Committee of the company is in accordance with the provisions relating to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year, there were no cases filed pursuant to the aforesaid Act.

ACKNOWLEDGEMENT:

We hereby sincerely recognize and admire the comprehensive support and cooperation of our Bankers, Auditors, RTA and members during the year.

Place: Surat For the Board of Director
Date: 02.09.2021 ZOTA HEALTH CARE LIMITED
sd/- sd/-
Moxesh Ketanbhai Zota Himanshu Muktilal Zota
Managing Director Whole-time Director
DIN:07625219 DIN:01097722