Arch Pharmalabs Ltd Shares Annual Reports

Arch Pharmalabs Ltd Shares

ARCH Pharmalabs Limited's 29th Annual Report for 2021-2022 includes corporate information, notices, director's report, annexures, and standalone & consolidated financial statements. **Corporate Information:** Arch Pharmalabs Limited is a pharmaceutical company manufacturing and selling active pharmaceutical ingredients (APIs) and intermediates. The company has a Board of Directors including Mr. Ajit Kamath (Chairman & Managing Director), Mr. Rajendra Kaimal, Mr. Ashish Ujagare (Executive Directors), and Dr. Sunil Pitroda (Independent Director). The company works with various banks and financial institutions, including JM Financial Asset Reconstruction Co. Ltd., Oriental Bank of Commerce, Corporation Bank, Bank of India, Bank of Baroda, Jammu & Kashmir Bank, and Indian Overseas Bank. Link Intime India Pvt. Ltd. serves as the Registrar & Share Transfer Agent. The Statutory Auditors are M/s. Taori Sandeep & Associates. The company's registered office is located in Mumbai, with plant locations in Haryana, Maharashtra, and Telangana. **Notice:** The 29th Annual General Meeting was held on December 30, 2022, via video conferencing. Ordinary business included adopting audited financial statements for the year ending March 31, 2022, reappointing Mr. Rajendrakumar Kaimal as a Director, and appointing M/s. Neha C Shah & Associates as Statutory Auditor for five years, concluding in 2027. Special business included ratifying the cost auditor's remuneration and offering equity shares on a preferential basis by converting financial obligations into equity shares of the company. The board had approached Nipro Pharmapackaging India Private Limited to convert receivables into equity shares, issuing up to 45,57,692 equity shares at Rs.328/- per share, including a premium of Rs.318/- per equity share aggregating up to Rs. 149,49,04,953/-. Dr. Sunil Pitroda was re-appointed as an Independent Director for a term of 5 years, up to December 29, 2027. **Directors' Report:** The company's operating revenue increased to Rs. 1,30,898 Lakhs in the year ended March 31, 2022, up from Rs. 70,601 Lakhs in the previous year. A profit before tax of Rs. 5854 lakhs was achieved, compared to a loss before tax of Rs. 87669 Lakhs in the previous year. Net profit was Rs. 5873 lakhs compared to Rs. 186734 lakhs in the previous year. The financial restructuring with JM Financial Asset Reconstruction Co. Ltd. is ongoing. The directors do not recommend any dividend. A profit of Rs. 5,873.22 Lakhs was transferred to Reserves & Surplus. The company maintains high quality standards, with certifications including USFDA inspected Vitalife site (Gurgaon), USFDA inspected Merven site (Telangana), and USFDA & EDQM inspected Dombivli site (Maharashtra). Subsidiaries include Arch Life Sciences Limited, Arch Finechemicals Limited, Arch Pharmalabs FZ LLC, and Vitalife Pharma Ltd. Kobo Biotech Limited is an associate company (44.95% stake). The Board held seven meetings during the year. The Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee, and Stakeholders Relationship Committee are active. Taori Sandeep & Associates, the statutory auditors, are not eligible for reappointment. The company has a whistle blower policy and a risk management policy. All related-party transactions were at arm's length and in the ordinary course of business. Details of loans, guarantees, and investments are in Note No. 27 to the standalone financial statements. **Annexure A:** The company is committed to reducing energy consumption. It is evaluating the use of alternate energy sources like solar panels. R&D expenditure was Rs. 332.04 lakhs in 2021-22 compared to Rs. 273.41 lakhs in 2020-21. Foreign exchange earned was Rs. 6,342.37 lakhs and used/outgo was Rs. 4,174.91 lakhs. **Annexure B:** Riddhi Shah, Company Secretary in Practice, conducted the secretarial audit and stated that Arch Pharmalabs Limited complied with the statutory provisions. However, the company needs to appoint an Internal Auditor, has defaulted in payment of interests on loans and finance facilities and defaulted/delayed in repayment of loans/borrowing availed from Bank and various financial institutions. Additionally, they need to appoint 2 independent directors and a woman director. **Auditor's Report:** Taori Sandeep & Associates issued a qualified opinion on the standalone financial statements due to non-provision of interest on borrowings and payment of managerial remuneration in contravention of the Companies Act. There are material uncertainties regarding outstanding receivables from related parties. However, the Company maintained proper records, complied with accounting standards, and properly disclosed pending litigations. The internal financial controls system is adequate. The auditors report that the company has defaulted/delayed in repayment of loans and borrowing to financial institutions, banks. The report also details comments pertaining to specific clauses in the Companies (Auditor’s Report) Order 2020. **Financial Statements (Standalone):** The standalone balance sheet as at March 31, 2022, shows a share capital of Rs 15,192.31 Lacs and reserves and surplus of Rs 43,714.71 Lacs. Long-term borrowings amount to Rs 66,898.11 Lacs. Key assets include property, plant and equipment of Rs 87,627.19 Lacs and inventories of Rs 69,890.50 Lacs. The statement of profit and loss shows a revenue from operations of Rs 1,30,897.73 Lacs and a profit for the year of Rs 5,873.22 Lacs. **Financial Statements (Consolidated):** The consolidated balance sheet as at March 31, 2022, shows a share capital of Rs 15,192.31 Lacs and reserves and surplus of Rs 43,267.97 Lacs. Long-term borrowings amount to Rs 66,898.11 Lacs. Key assets include property, plant and equipment of Rs 87,627.19 Lacs, goodwill of Rs 741.94 Lacs, and inventories of Rs 69,890.50 Lacs. The statement of profit and loss shows a revenue from operations of Rs 1,30,897.73 Lacs and a profit for the year of Rs 5,186.64 Lacs. The Financial statements also details contingent liabilities and commitments.

Arch Pharmalabs Ltd Shares

The document is the 28th Annual Report for Arch Pharmalabs Limited, covering the financial year 2020-2021. It includes corporate information, notices for the Annual General Meeting (AGM), Director's Report, standalone and consolidated financial statements, and auditor's reports. **Corporate Information:** * Lists the Board of Directors as of March 31, 2021 including Mr. Ajit Kamath (Chairman & Managing Director), Mr. Rajendra Kaimal and Mr. Ashish Ujagare (Executive Directors) and Dr. Sunil Pitroda (Independent Director). * Includes contact information for Banks & Financial Institutions, Statutory Auditors (Taori Sandeep & Associates), and the Registrar & Share Transfer Agent (Link Intime India Pvt. Ltd.). * Details plant locations of the company across India. **Notice:** * The 28th Annual General Meeting will be held on December 30, 2021, via video conferencing. * The agenda includes adopting audited financial statements for the year ending March 31, 2021, appointing a director, ratifying the cost auditor's remuneration for the year ending March 31, 2022 (up to ₹1,00,000 to M/s. Santiram Chattopadhyay & Associates), and approving private placement of Non-Convertible Debentures (NCDs) and/or Debt Securities up to ₹100 Crores. * Approval is sought for the Board to create, offer, issue and allot secured/unsecured redeemable non-convertible debentures (NCDs) and/or subordinated debenture, bonds, instruments and other debt securities, provided that outstanding principal amount of Debt Securities shall not exceed *100 Crores. * Provides detailed instructions and procedures for shareholders to participate in the AGM via e-voting. **Director's Report:** * Financial performance: Revenue increased to ₹70,601 Lakhs, but the company incurred a loss before tax of ₹(87,669) Lakhs. Net Profit/(Loss) for the Year was ₹1,86,734 Lakhs. * Discusses the challenges and opportunities in the API manufacturing sector, including dependence on China and the push for domestic manufacturing. * JM Financial Asset Reconstruction Company Limited (JMF ARC) is aggregating debt from the Lenders and a Restructuring Agreement was executed in Dec 2017. Company has approached JMFARC for further restructuring of its loans to sustainable levels. * No dividend is recommended. Profit of ₹1,86,735 Lakhs has been transferred to the Balance Sheet. * The company maintains high-quality standards and has valid certifications, including USFDA inspections. * Mr. Ashish Ujagare is retiring by rotation and offers himself for reappointment. Dr. Sunil Pitroda has given declaration that they meet the criteria of independence. * 5 Board meetings were held during the year. * M/s. Taori Sandeep & Associates are the statutory auditors. M/s. Santiram Chattopadhyay & Associates are the Cost Auditors for the Financial year 2020-21. Ms. Riddhi Shah is the Secretarial Auditor. * The company has a whistle blower policy and a risk management policy. * Reports nil information on employee remuneration under Section 197. **Annexures to Director's Report:** * **Annexure A:** Details conservation of energy, technology absorption and foreign exchange earnings and outgo. Foreign Exchange earned was ₹5,628 lakhs and Foreign Exchange used was ₹3,272 lakhs. * **Annexure B:** Secretarial Audit Report which indicates compliance with various laws, however, notes non-compliance with certain provisions such as appointment of an Internal Auditor, Independent Director, woman director and delays in statutory payments and payment of interest. The report includes observations that the Board of Directors is not duly constituted as company has not appointed required number of independent directors and women director. * **Annexure C:** Extract of Annual Return, including registration details, principal business activities, and details of holding, subsidiary, and associate companies. Includes shareholding patterns, details of promoters, and information on indebtedness. **Independent Auditor's Report (Standalone & Consolidated):** * The auditor, Taori Sandeep & Associates, expresses a qualified opinion on the standalone and consolidated financial statements due to non-provision of interest on borrowings and contravention of provisions of Section 196 & 197 of The Companies Act, 2013 regarding managerial remuneration. The net effect is an understatement of loss and liabilities. * Key Audit Matters: Restructuring with JMFARC; Loans/Guarantees to Related party. * The auditors highlight the company's ongoing efforts to restructure loans with JMF ARC and the potential impact of this restructuring on the company's losses. * The report includes an annexure providing details on compliance with the Companies (Auditor's Report) Order, 2016 and comments on items such as fixed assets, inventory, loans, deposits, and statutory dues. **Financial Statements (Standalone & Consolidated):** * The balance sheet, statement of profit and loss, and cash flow statement are presented. The figures presented are in Lakhs. * The total Equity and Liabilities are equal to the Total Assets. * Revenue from operations for standalone financials is reported at 70,601.12 Lakhs, while loss before tax is (87,668.58) Lakhs. * The consolidated financial statements shows a similar pattern to that of standalone statements. * Various notes to the financial statements provide additional details on items such as share capital, reserves, long-term borrowings, short-term borrowings, trade payables, related party transactions, and contingent liabilities. * Details on related party transactions, including those with Arch Impex Pvt Ltd. * The company has outstanding receivable as referred in Note No. 27 from related parties amounting ₹467.84 Lacs in respect of loans advances and guarantees given by it to third parties on behalf of related parties amounting ₹15,272.00 Lacs prior to commencement of The Companies Act, 2013. **Overall:** The report illustrates a company undergoing financial restructuring with a focus on scaling up operations and emphasizes compliance with regulations while facing challenges related to debt and financial stability. There is a clear emphasis on improving domestic manufacturing capabilities in the pharmaceutical sector and reducing reliance on imports.