FINANCIAL RESULTS
The financial statements of the Company have been prepared in accordance with the
Indian Accounting Standards (Ind AS) notified under section 133 of the Companies Act,
2013, read with Rule 7 of the Companies (Accounts) Rules, 2014.
The standalone and consolidated financial performance of the Company, for the financial
year ended on 31 March 2023 is summarised below:
(Amounts in Rs million)
Particulars |
Standalone |
Consolidated |
|
31 March 2023 |
31 March 2022 |
31 March 2023 |
31 March 2022 |
Revenue from operations |
2,540.00 |
2,193.51 |
2,660.91 |
2,350.06 |
Other income |
53.23 |
46.57 |
151.51 |
137.41 |
Total Revenue |
2,593.23 |
2,240.08 |
2,812.42 |
2,487.47 |
Profit before interest, depreciation, amortisation expenses and tax
(PBIDT) |
602.09 |
652.26 |
657.60 |
737.24 |
Less: Finance Cost |
64.97 |
24.68 |
93.20 |
40.64 |
Less: Depreciation and Amortisation Expenses |
97.88 |
95.02 |
206.95 |
165.81 |
Profit before Share of Profit in Joint Venture entity and |
439.24 |
532.56 |
357.45 |
530.79 |
Tax |
|
|
|
|
Share of Profit in Joint Venture entity |
- |
- |
44.09 |
4.23 |
Profit before tax |
439.24 |
532.56 |
401.54 |
535.02 |
Less: Tax Expenses |
115.82 |
137.39 |
121.19 |
140.18 |
Profit for the year (PAT) |
323.42 |
395.17 |
280.35 |
394.84 |
Attributable to: |
|
|
|
|
Owners |
323.42 |
395.17 |
266.27 |
393.20 |
Non-Controlling Interest |
- |
- |
14.08 |
1.64 |
Other Comprehensive Income /(Loss) |
1.13 |
(1.57) |
16.25 |
8.21 |
Attributable to: |
|
|
|
|
Owners |
1.13 |
(1.57) |
16.26 |
8.21 |
Non-Controlling Interest |
- |
- |
(0.01) |
- |
Total Comprehensive Income |
324.55 |
393.60 |
296.60 |
403.05 |
Attributable to: |
|
|
|
|
Owners |
324.55 |
393.60 |
282.53 |
401.41 |
Non-Controlling Interest |
- |
- |
14.07 |
1.64 |
Earnings Per Share (Basic / Diluted) |
38.02 |
46.45 |
32.96 |
46.41 |
(Face Value of Share Rs 10 each) |
|
|
|
|
There are no material changes and commitments affecting the financial position of the
Company between the end of the financial year and the date of this report.
RESULTS OF OPERATIONS
Sales
During the year under review, the standalone revenue from operations was Rs 2,540.00
million, as compared to Rs 2,193.51 million in the previous year. The consolidated revenue
from operation was Rs 2,660.91 million in the financial year ended on 31 March 2023, as
compared to Rs 2,350.06 million in the previous year.
Profitability
The Company achieved a standalone profit before tax of Rs 439.24 million, as compared
to Rs 532.56 million in the previous year. The consolidated profit before tax was Rs
401.54 million in the financial year ended on 31 March 2023, as compared to Rs 535.02
million in the previous year.
Earnings per share
The EPS on the standalone financials was Rs 38.02 for the year ended on 31 March 2023
as against Rs 46.45 as on 31 March 2022. The EPS on consolidated financials was Rs 32.96
for the year ended on 31 March 2023 as against Rs 46.41 as on 31 March 2022.
Share Capital
The paid-up equity share capital as on 31 March 2023 stood at Rs 85.07 million.
Net Worth
The Company's net worth on standalone basis as on 31 March 2023 was Rs 2,923.82 million
as compared to
Rs 2,684.34 million as on 31 March 2022. The Company's net worth on consolidated basis
as on 31 March 2023 was Rs 2,885.46 million as compared to Rs 2,673.93 million as on 31
March 2022.
Transfer to Reserves
The Board of Directors of the Company has decided not to transfer any amount to the
reserves for the year under review.
DIVIDEND
Your Directors have recommended a dividend of Rs 8 per equity share (80%) on 8,506,865
equity shares of
Rs 10 each fully paid-up for the financial year 2022-23, amounting to Rs 68.05 million.
The dividend, if declared by the members at the ensuing Annual General Meeting
("AGM"), will be paid to those shareholders, whose names registered in the
Register of Members on cut-off date. The Dividend Pay-out Ratio for the current year is
21% of standalone profits. The dividend pay-out is in accordance with the Company's
Dividend Distribution Policy. The Dividend Distribution Policy of the Company, in terms of
Regulation 43A of SEBI (LODR) Regulations, 2015 (as amended from time to time), is
available at the web link: https://www.hester.in/corporate-governance
BORROWINGS
The Company has long-term borrowings outstanding amounting to Rs 1,069.85 million as on
31 March 2023.
CONSOLIDATED FINANCIAL STATEMENTS
The consolidated total income from operations is Rs 2,660.91 million and total
comprehensive income attributable to owner's equity after non-controlling interest is Rs
282.53 million for the financial year 2022-23 as compared to the consolidated total income
from operations of Rs 2,350.06 million and total comprehensive income attributable to
owner's equity after non-controlling interest of Rs 401.41 million for the previous
financial year 2021-22. Consolidated financial statements include the financial statements
of the following entitie
1 Hester Biosciences Nepal Private Limited |
Foreign Subsidiary |
2 Texas Lifesciences Private Limited |
Indian Subsidiary |
3 Hester Biosciences Africa Limited |
Foreign Wholly-owned Subsidiary |
4 Hester Bioscience Kenya Limited |
Foreign Wholly-owned Subsidiary |
5 Hester Biosciences Tanzania Limited |
Foreign Step-down Subsidiary (Wholly-owned Subsidiary of Hester
Biosciences Kenya Limited) |
6 Thrishool Exim Limited: |
Foreign Joint Venture Entity |
In accordance with the Indian Accounting Standard (Ind AS) - 110 Consolidation of
Financial Statements and as provided under the provisions of the Companies Act, 2013
(hereinafter referred to as "Act") read with Schedule III to the Act and Rules
made thereunder and the SEBI ( Listing Obligations and Disclosure Requirements)
Regulations, 2015, the Audited Consolidated Financial Statements are provided in the
Annual Report, which show the financial resources, assets, liabilities, incomes, profits
and other details of the Company, its subsidiary Companies after elimination of minority
interest, and joint venture entity as a single entity.
SUBSIDIARY COMPANIES
As on 31 March 2023, your Company has two wholly-owned subsidiary companies namely,
Hester Biosciences Africa Limited and Hester Biosciences Kenya Limited; and two subsidiary
companies namely, Hester Biosciences Nepal Private Limited and Texas Lifesciences Private
Limited; and one step-down subsidiary company, Hester Biosciences Tanzania Limited (a
wholly-owned subsidiary of Hester Biosciences Kenya Limited).
The business details of the subsidiary companies are as under:
Texas Life sciences Private Limited (Texas Life sciences)
Texas Life sciences is a subsidiary of Hester Biosciences Limited and holds 54.81%
stake. Texas Life sciences is in the business of manufacturing and supplying pharma
formulations, tablets, capsules, powder and oral liquid for human and veterinary markets.
Hester Biosciences Nepal Private Limited (HBNPL)
HBNPL is a subsidiary of Hester Biosciences Limited and holds 65% stake in HBNPL. HBNPL
is in the business of manufacturing veterinary vaccines in Nepal.
Hester Biosciences Africa Limited (HBAL)
HBAL is 100% wholly-owned subsidiary of Hester Biosciences Limited in Tanzania. HBAL
will be in the business of manufacturing veterinary vaccines and animal health product in
Tanzania.
Hester Biosciences Kenya Limited (HBKL)
HBAL is 100% wholly-owned subsidiary of Hester Biosciences Limited in Kenya. HBKL is in
the business of Trading of veterinary vaccines and animal health product in Kenya.
Hester Biosciences Tanzania Limited (HBTL)
HBTL is subsidiary of HBKL and step-down subsidiary of Hester Biosciences Limited. HBTL
is in the business of Trading of veterinary vaccines and animal health product in Tanzania
and other Africa region.
There has been no material change in the nature of business of the subsidiaries. More
details are provided into the financial statements. During the year under review, the
Board has reviewed the performance / aRsairs of the subsidiary companies.
As provided in section 136 of the Act, the Balance Sheet, Statement of Profit and Loss
and other documents of the subsidiary companies are not being attached with the Balance
Sheet of the Company. The Company will make available free of cost the Audited Financial
Statements of the subsidiary companies and the related detailed information to any member
of the Company who may be interested in obtaining the same. The Financial Statements of
the subsidiary companies will also be kept open for electronic inspection. The
Consolidated Financial Statements presented by the Company include financial statements
and highlights of its subsidiary and joint venture entity are part of this Board Report as
Annexure - 1 as prescribed in Form AOC-1.
As provided under section 129(3) of the Companies Act, 2013 and Rules made thereunder a
statement containing the salient features of the financial statements of its subsidiaries
in the format prescribed under the rules is attached to the financial statements. The
policy relating to material subsidiaries as approved by the Board may be accessed on the
Company's website at the link: https://www.hester.in/corporate-governance
JOINT VENTURE ENTITY
Thrishool Exim Limited (TEL) is 50% joint venture entity of Hester Biosciences Limited
in Tanzania. TEL is a supplier and distributor of animal health and nutrition products of
many companies. TEL's product range includes veterinary feed additives, feed raw
materials, nutritional supplements, therapeutics and equipment sourced from recognised
international producers. TEL has an established sourcing network with globally positioned
partners from Europe, Asia and Southern Africa.
INSURANCE
The Company's plant, properties, equipment, stocks and vehicles are adequately insured
against all major risks. The Company has also taken Directors and ORscers Liability Policy
to provide coverage against the liabilities arising on them.
PUBLIC DEPOSITS
During the year under review, the Company has not accepted deposits from shareholders
and public falling within the ambit of Section 73 of the Companies Act, 2013 and rules
made thereunder.
REPORTING OF FRAUDS BY AUDITORS
During the year under review, neither the statutory auditor nor the secretarial auditor
have reported to the Audit Committee, under section 143(12) of the Act, any instances of
fraud committed against the Company by its oRscers or employees, the details of which
would need to be mentioned in the Board's Report.
RELATED PARTY TRANSACTIONS
All Related Party transactions are entered in compliance to the provisions of law, the
Policy on Materiality of and dealing with Related Party Transactions ("Related Party
Policy") and were entered with the approval of Audit Committee, Board and
Shareholders if and as applicable.
The particulars of material contracts and arrangements entered into with the related
parties in accordance with the Related Party Policy of the Company and pursuant to the
provisions of Section 188(1) of the Companies Act, 2013 and Rule 8(2) of the Companies
(Accounts) Rules, 2014 are annexed herewith as Annexure-2.The Related Party Transactions
for the financial year 2022-23 have been disclosed in Notes to the Financial Statements of
the Company.
The policy on Related Party Transactions and material related party transaction are
uploaded on the website of the Company and may be accessed through the web link: https://www.hester.in/corporate-governance
PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
Details of loans, guarantees and investments covered under the provisions of Section
186 of the Companies Act, 2013 are given in the notes to the Financial Statements.
COST ACCOUNTS AND RECORDS
The Company has made and maintained the cost accounts and records as specified by the
Central Government under section 148 (1) of the Act and Rules made thereunder.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
Re-appointment and cessation of Directors
During the year, based on the recommendation of the Nomination and Remuneration
Committee and the performance evaluation of directors, the Board of Directors, through
circular resolutions passed on 27 March 2023, have approved and recommended the
re-appointment of Ms. Sandhya Patel (DIN: 02215022) and Mr. Ashok Bhadakal (DIN: 00981201)
as independent directors for the second term of five years with eRsect from 1 April 2023,
subject to the approval of members.
Members of the Company have approved the reappointment of Ms. Sandhya Patel (DIN:
02215022) and Mr. Ashok Bhadakal (DIN: 00981201) as Independent Directors of the Company
through the postal ballot process, and results were declared on 1 May 2023.
Pursuant to the provisions of the Companies Act, 2013, Mr. Naman Patel and Mr. Amit
Shukla, Independent Directors of the Company, ceased to hold the oRsce with eRsect from 1
April 2023, due to the completion of two consecutive terms as Independent Directors of the
Company.
Retirement by Rotations
In accordance with the provisions of section 152 (6) of the Companies Act, 2013,
Listing Regulations and in terms of the Articles of Association of the Company, Mr. Sanjiv
Gandhi (DIN: 00024548), Non-Executive Director will retire by rotation at the ensuing
Annual General Meeting and being eligible, oRsers himself for re-appointment. The Board
recommends his reappointment.
Declaration of Independence
The Company has received declaration of independence as stipulated under sections
149(6) and 149(7) of the Companies Act, 2013 and regulation 16(1) (b) and 25 of the
Listing Regulations from Independent Directors confirming that they are not disqualified
for continuing as an Independent Director. There has been no change in the circumstances
aRsecting their status as an independent director of the Company.
Profile of Directors seeking Appointment/Reappointment
As required under Regulation 36 (3) of the SEBI (LODR) Regulations, 2015, particulars
of Directors seeking appointment/ re-appointment at the ensuing Annual General Meeting are
annexed to the notice convening Thirty Sixth Annual General Meeting.
Key Managerial Personnel
The followings persons are the Key Managerial Personnel (KMP) as per the provisions of
the Companies Act, 2013, as on 31 March 2023:
1. Mr. Rajiv Gandhi, CEO & Managing Director
2. Ms. Priya Gandhi, Executive Director
3. Mr. Nikhil Jhanwar, Chief Financial Officer
4. Mr. Vinod Mali, Company Secretary
Board Evaluation:
During the year, the evaluation of the annual performance of individual directors,
including the Chairman of the Company and Independent Directors, the Board, and Committees
of the Board, was carried out under the provisions of the Act and relevant Rules and the
corporate governance requirements as prescribed under Regulation 17 of the Listing
Regulations, 2015, and the circulars with respect to the Guidance Note on Board
Evaluation. The evaluation of the performance of the board as a whole and of the
committees was conducted through questionnaires.
In a separate meeting of Independent Directors, the performance of Non-Independent
Directors and the performance of the Board as a whole were evaluated. Further, they also
evaluated the performance of the Chairman of the Company, taking into account the views of
the Executive Directors and Non-Executive Directors.
The Board of Directors reviewed the performance of individual directors on the basis of
criteria fixed by the Board. The functioning of the Board, the Committees, and the
performance of individual Directors were found satisfactory.
The way, the evaluation has been carried out has been explained in the Corporate
Governance Report.
Nomination and Remuneration Policy
The Board has on the recommendation of the Nomination and Remuneration Committee framed
a policy on selection and appointment of Directors, Senior Management Personnel and their
remuneration. The Remuneration Policy is stated in the Corporate Governance Report, which
is a part of this Annual Report.
Pecuniary Relationship
During the year under review, except those disclosed in the audited financial
statements, the non-executive directors of the Company had no pecuniary relationship or
transactions with the Company.
Board of Directors Meetings
The Board of Directors met 5 (Five) times during the financial year 2022-23 and having
gap of not more than 120 days between 2 (Two) consecutive Board Meetings. The information
of meetings of the Board of Directors is given in Corporate Governance Report, forming a
part of this Annual Report.
DIRECTOR'S RESPONSIBILITY STATEMENT
In terms of section 134(3)(c) read with 134(5) of the Companies Act, 2013 and to the
best of their knowledge and belief, and according to the information and explanations
provided to them, your Directors hereby make the following statements:
a) That in preparation of Financial Statements for the year ended 31 March 2023, the
applicable accounting standards have been followed and no material departures have been
made from the same;
b) 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 aRsairs of the Company at the end of the financial year and of
the profit or loss of the Company for that year;
c) The Directors had taken proper and suRscient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013, for
safeguarding the assets of the Company and for preventing and detecting fraud and other
irregularities;
d) The Directors had prepared the Financial Statements for the year ended 31 March 2023
on going concern basis;
e) The Directors had laid down the internal financial controls to be followed by the
Company and that such internal financial controls are adequate and were operating
effsectively; and
f) The Directors had devised proper systems to ensure compliance with the provisions of
all applicable laws were in place and were adequate and operating effsectively.
COMMITTEES OF BOARD OF DIRECTORS
Your Company has several Committees which have been established as part of best
corporate governance practices and are in compliance with the requirements of the relevant
provisions of applicable laws and statutes.
The Company has following Committees of the Board:
i) Audit Committee
ii) Nomination and Remuneration Committee
iii) Stakeholder's Grievances and Relationship Committee
iv) Corporate Social Responsibility Committee
v) Risk Management Committee
vi) Management Committee
A detailed note on the committees with respect to composition, meetings, powers and
terms of reference is provided under the Corporate Governance Report section in this
Annual Report.
RECOMMENDATION OF COMMITTEES
The Board has accepted the recommendations of all the committees constituted by the
Board.
CORPORATE SOCIAL RESPONSIBILITY ("CSR")
Pursuant to section 135 of the Act and the relevant rules, the Board has constituted a
Corporate Social Responsibility ("CSR") Committee under the Chairmanship of Mr.
Rajiv Gandhi. The details of membership of the Committee & the meetings held are
detailed in the Corporate Governance Report, forming part of this Report. The contents of
the CSR Policy of the Company as approved by the Board on the recommendation of the CSR
Committee is available on the website of the Company and can be accessed through the
website of the Company: https://www.hester.in/corporate-governance
During the year, the Company has spent Rs 10.20 million on CSR activities. The
Disclosures with respect to CSR Activities forming part of Board's Report as Annexure-3.
VIGIL MECHANISM /WHISTLE BLOWER POLICY
The Company has in place a stringent vigil system to report unethical behaviour in
order to promote professionalism, fairness, dignity and ethical behaviour in its
employees.
In compliance with provisions of section 177(9) of the Act and rules made thereunder
and regulation 22 of the Listing Regulations, the Company has established vigil mechanism
and framed Whistle Blower Policy for Directors and employees to report concerns about
unethical behavior, actual or suspected fraud or violation of the Company's Code of
Conduct and under the provisions of the SEBI (Prohibition of Insider Trading) Regulations,
2015. Whistle Blower Policy is uploaded on Company's website and the link of the same is
provided in a separate section of Corporate Governance Report. No whistle blower has been
denied access to the Audit Committee of the Board.
DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE PREVENTION, PROHIBITION
AND REDRESSALRs ACT, 2013
The Company has zero tolerance towards sexual harassment at the workplace and has
adopted a policy on prevention, prohibition and redressal of sexual harassment at
workplace in line with the provisions of the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 and the Rules made there under.
The Company always endeavors to create and provide an environment to its employees and
external individuals engaged with the Company that is free from discrimination and
harassment including sexual harassment. The Company has in place a robust policy on
prevention of sexual harassment at workplace. The policy aims at prevention of harassment
of employees as well as contractors and lays down the guidelines for identification,
reporting and prevention of sexual harassment. During the financial year 2022-23, no
complaints were received with regards to sexual harassment at any location of the Company.
INSIDER TRADING REGULATIONS
The Company has adopted the Code for Insider Trading as per the SEBI (Prohibition of
Insider Trading) Regulations, 2015. All other details on insider trading regulations are
mentioned into the Corporate Governance Report, which forms a part of this Annual Report.
CORPORATE GOVERNANCE
The Company has complied with the Corporate Governance requirements under the Companies
Act, 2013 and Regulations 17 to 27 and 46 of the SEBI (LODR) Regulations, 2015 and
amendments therein.
A separate section on detailed report on Corporate Governance practice followed by the
Company under SEBI (LODR) Regulations, 2015 along with a certificate from Practicing
Company Secretary, confirming the compliance forms a part of this report. The Board of
Directors supports the basic principles of corporate governance and lays strong emphasis
on transparency, accountability and integrity.
SECRETARIAL STANDARDS
Secretarial Standards for the Board of Directors Meeting (SS-1) and General Meetings
(SS-2) are applicable to the Company. The Company has complied with the provisions of all
applicable Secretarial Standards.
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
Pursuant to the provisions of the SEBI (Listing
Obligation and Disclosure Requirements) Amendment Regulations, the SEBI has mandated
the Top 1000 listed companies as per market capitalisation to prepare and publish the
Business Responsibility and Sustainability Report (BRSR') with eRsect from the
financial year 2022-23 in a specific format.
As the Company is among the top 1000 listed companies by market capitalisation, it is
mandated to disclose the initiative on environmental, social, and governance perspective
and publish the BRSR report. The BRSR report is attached and forms part of the Annual
Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis Report is set out in a separate section included in
this Annual Report and forms part of this Report. The Audit Committee has reviewed the
Management Discussion and Analysis of financial conditions and results of operations
during the year under review.
AUDITORS
Statutory Auditor and Audit Report
Chandulal M. Shah & Co. (Firm Registration No. 101698W), Chartered Accountants,
Ahmedabad, was appointed as the Statutory Auditors of the Company till the conclusion of
Thirty Sixth Annual General Meeting. Chandulal M. Shah & Co., Chartered Accountants
have furnished a declaration confirming their independence as well as their arm's length
relationship with the Company and that they have not taken up any prohibited non-audit
assignments for the Company.
The Audit Committee and the Board at their respective meetings held on 17 May 2023
recommended the re-appointment of Chandulal M. Shah & Co. as the Statutory Auditors of
the Company for a further period of 5 (five) consecutive years from the conclusion of
Thirty Sixth AGM till the conclusion of Forty First AGM in year 2028, with an authority to
the Audit Committee and the Board to decide the remuneration payable to them.
Re-appointment of Chandulal M. Shah & Co. is subject to approval of members at the
ensuing AGM.
The Board has duly reviewed the Statutory Auditor's Report of Chandulal M. Shah &
Co. for the year ended on 31 March 2023. The Notes on financial statement referred to in
the Auditor's Report are self-explanatory and do not call for any further comments. The
Auditor's Report does not contain any qualification, reservation, adverse remark or
disclaimer.
Internal Auditor and Audit Report
Ernst & Young LLP, Ahmedabad, has been the internal auditor of the Company for the
FY 2022-23. The Internal Auditor is appointed by the Board of Directors of the Company on
a yearly basis, based on the recommendation of the Audit Committee. The Internal Auditor
reports its findings on the internal audit of the Company to the Audit Committee on a
quarterly basis. The scope of internal audit is approved by the Audit Committee and
Management from time to time.
The Board has re-appointed Ernst & Young LLP, Ahmedabad for the FY 2023-24 as an
Internal Auditor of the Company, after obtaining its willingness and eligibility letter
for appointment as Internal Auditor of the Company.
Cost Auditor
Pursuant to provisions of Section 148 read with Companies (Audit & Auditors) Rules,
2014 and other applicable provisions, if any, of the Companies Act, 2013, the Board of
Directors had, on recommendation of the Audit Committee, re-appointed Kiran J. Mehta &
Co., Cost Accountants, Ahmedabad, as the Cost Auditor of the Company for the financial
year 2022-23, on the remuneration terms as approved by the members at the previous Annual
General Meeting. The Cost Audit report for the financial year 2021-22 was filed within the
due date. The due date for submission of the Cost Audit Report for the year 2022-23 is
within 180 days from 31 March 2023.
The Board has re-appointed Kiran J. Mehta & Co., Cost Accountants, Ahmedabad for
the FY 2023-24 as a Cost Auditor to audit the cost records of the Company on a
remuneration up to Rs 0.23 million plus applicable Goods and Services Tax and out of
pocket expenses on actuals. As required under the Act and Rules made thereunder, the
remuneration payable to the Cost Auditor is required to be placed before the Members in a
general meeting for ratification. Accordingly, a resolution seeking ratification by
members for the remuneration payable to Kiran J. Mehta & Co. is included in the Notice
convening 36th Annual General Meeting of the Company.
Secretarial Auditor and Secretarial Audit Report
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors
had re-appointed Mr. Tapan Shah, Practicing Company Secretary to undertake the Secretarial
Audit of the Company for the FY 2022-23. The Secretarial Audit Report for the FY 2022-23
is annexed to this Board's Report as Annexure-4. The Board has duly reviewed the
Secretarial Auditor's Report for the year ended on 31 March 2023. The Auditor's Report
does not contain any qualification, reservation, adverse remark or disclaimer.
Further, as per regulation 24A(1) of the Listing Regulations, the secretarial audit
reports of Texas Lifesciences Private Limited, unlisted material subsidiary company is
annexed herewith as Annexure-4A.
Annual Secretarial Compliance Report
In compliance with regulation 24A (2) of the Listing Regulations, Mr. Tapan Shah,
Practicing Company Secretaries issued Annual Secretarial Compliance Report for the
Financial Year ended on 31 March 2023. The Report, presented at the Board meeting held on
17 May 2023, confirmed that the Company has maintained proper records as stipulated under
various Rules and Regulations and that, no action has been taken against the Company or
its material subsidiaries or promoters / directors by SEBI / BSE / NSE. The Company has
submitted the Report to the Stock Exchanges within the prescribed time.
MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY
There are no material changes and commitments, aRsecting the financial position of the
Company which has occurred between the end of financial year and the date of Board's
Report.
BUSINESS RISK MANAGEMENT
The Company has an elaborate Risk Management procedure covering various risks including
Business, Operational, Financial, Sectoral, Market, Regulatory and Compliance,
Sustainability, Human Resources, Information and Cyber Security and Strategic Risks and
its assessment, measurement and mitigation processes. Major risks identified by the
businesses and functions are systematically addressed through mitigating actions on a
continuous basis within the risk appetite as approved from time to time by the Board of
Directors. The risk management framework is reviewed periodically by the Board and the
Audit Committee. Discussion on risks and concerns are covered in the Management Discussion
and Analysis Report, which forms a part of this Annual Report.
Pursuant to the provisions of section 134(3)(n) of the Act and regulation 21 of Listing
Regulations, the Company has constituted a Risk Management Committee. The details of the
Committee and its terms of reference are set out in the Corporate Governance Report, which
forms a part of this Annual Report.
INTERNAL FINANCIAL CONTROL SYSTEMS AND ITS ADEQUACY
The Company has a formal framework of Internal Financial Control ("IFC") in
alignment with the requirement of Companies Act, 2013 and has also laid down specific
responsibilities on the Board, Audit Committee, Independent Directors and Statutory
Auditors with regard to IFC.
Accordingly, the Company has a well-placed, proper and adequate IFC system, which
ensures:
1. The orderly and eRscient conduct of its business,
2. Safeguarding of its assets,
3. The prevention and detection of frauds and errors,
4. The accuracy and completeness of the accounting records and
5. The timely preparation of reliable financial information.
The Board reviews the eRsectiveness of controls documented as part of IFC framework,
and take necessary corrective and preventive actions wherever weaknesses are identified as
a result of such reviews. This review covers entity level controls, process level
controls, fraud risk controls and Information Technology environment.
Based on this evaluation, no significant events had come to notice during the year that
have materially aRsected, or are reasonably likely to materially aRsect, our IFC. The
management has also come to a conclusion that the IFC and other financial reporting was
eRsective during the year and is adequate considering the business operations of the
Company. The Statutory Auditors of the Company have audited the adequacy of Internal
Financial Controls over Financial Reporting and the operating eRsectiveness of such
controls and their Audit Report is annexed as Annexure B and Annexure A to the Independent
Auditor's Report under Standalone Financial Statements and Consolidated Financial
Statements respectively.
CREDIT RATINGS
During the year, CARE Ratings Limited has revised the credit rating of "CARE
BBB+/Stable" for long-term bank facilities from "CARE A-/Stable." For
short-term bank facilities, "CARE A2" has been re-aRsrmed to the Company.
CERTIFICATIONS/ RECOGNITION/ ACCREDITATIONS
The Company having following Certifications/ Recognition/ Accreditations:
1. WHO - GMP
2. GLP (Good Laboratory Practices)
3. ISO 9001:2015
4. ISO 14001:2015
5. ISO 45001:2018
6. DSIR approved R&D Centre
TRANSFER OF SHARES AND DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND RsIEPFRs
ACCOUNT
During the year under review, in compliance with the provisions of sections 124 and 125
of the Act and Rules made thereunder the Company has transferred:
1. 1,750 equity shares of 8 (Eight) members whose dividend has remained unclaimed /
unpaid for a consecutive period of 7 (seven) years to IEPF.
2. Rs 0.41 million held by 642 members, being the unclaimed dividend, pertaining to the
dividend for the financial year 2014-15 was transferred to IEPF after giving notice to the
members to claim their unpaid / unclaimed dividend.
ANNUAL RETURN
Pursuant to Sub-section 3(a) of Section 134 and Subsection (3) of Section 92 of the
Companies Act, 2013 read with Rule 12 of Companies (Management and Administration) Rules,
2014, the copy of the Annual Return of the Company for the Financial Year ended on 31
March 2023 in Form MGT-7 is uploaded on website of the Company and can be accessed at www.hester.in
PARTICULAR OF EMPLOYEES
In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rule
5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014,
disclosures pertaining to remuneration and other details are provided in Annexure-5 to
this report.
CONSERVATION OF ENERGY,
TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy, technology absorption and foreign exchange
earnings and outgo as stipulated under Section 134(3)(m) of the Act read with Rule 8 of
The Companies (Accounts) Rules, 2014, is provided in Annexure-6 and forms part of this
report.
GENERAL DISCLOSURES
Your Directors state that the Company has made disclosures in this report for the items
prescribed in section 134 (3) of the Act and Rule 8 of the Companies (Accounts) Rules,
2014, to the extent the transactions took place on these items during the year.
Apart from what are mentioned in this report, there are no material changes and
commitments aRsecting the financial position of the Company between the end of the
financial year and the date of this report.
ACKNOWLEDGEMENT
Your Directors place on record their sincere appreciation for the continued
co-operation and support extended to the Company by Bank. Your Directors also thank the
Medical Professional, the Traders and Consumers for their patronage to the Company's
products. Your Directors also place on record sincere appreciation of the continued hard
work put in by the employees at all levels. The Directors also thank the Company's
vendors, investors, business associates, Stock Exchanges, Government of India, State
Governments and various departments and agencies for their support and co-operation.
Your Directors appreciate and value the contribution made by every member of the Hester
Biosciences.
For and on behalf of Board of Directors |
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Rajiv Gandhi |
Priya Gandhi |
Date 17 May 2023 |
CEO & Managing Director |
Executive Director |
Place Ahmedabad |
DIN: 00438037 |
DIN: 06998979 |
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