Get Updates

Get notified about market trends, financial advice, and investment tips!

A Oneindia Venture

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Directors Report of Natural Capsules Ltd.

Mar 31, 2025

Your Directors are pleased to present their 32^nd Annual Report together with the Audited Accounts of the company for the year ended 31^st March 2025.

FINANCIAL RESULTS:

The Company''s financial performance, for the year ended 31^st March 2025 is summarized here below:

(? in Lacs)
Particulars	Standalone		Consolidated
	Financial Year 2024-25	Financial Year 2023-24	Financial Year 2024-25	Financial Year 2023-24
Gross Sales	18913.76	17195.94	19063.30	17387.19
Less: GST	2119.94	1815.31	2142.75	1845.19
Net Sales	16793.82	15380.63	16920.55	15542.00
Other Income	423.54	314.57	70.37	193.62
Total	17217.36	15695.20	16990.92	15735.62
Profit before depreciation & taxation	1762.51	1896.32	1190.90	1671.97
Less: Depreciation	832.85	856.85	911.80	866.78
Less: Provision for Current Tax	207.39	197.13	207.39	197.13
Less: Prior Period Adjustment	-84.84		-84.84	-
Less: Deferred Tax Liability	136.00	61.84	94.81	52.71
Add: Exceptional Items-Income/(Exp.)	0.00	-	0.00	-
Add: Other Comprehensive Income/(Exp.)	-38.49	26.08	-39.01	26.08
Profit after taxation	632.62	806.58	22.73	581.43
Add: Balance b/f from previous year	8116.07	7335.57	7809.82	7252.88
Surplus available for appropriation	8748.69	8142.15	7832.55	7834.31
Appropriations	-	-		-
General Reserve	-	-	-	-
Proposed Dividend	-	-	-	-
Tax on Dividend	-	-	-	-
Additional depreciation on fixed asset as per Companies Act, 2013	-	-	-	-
Balance carried to Balance sheet	8748.69	8142.15	7832.55	7834.31

THE CHANGE IN THE NATURE OF BUSINESS, IF ANY:

There was no change in the nature of business for the period under review.

TRANSFER TO RESERVES:

The company does not propose to transfer any amount to the General Reserves.

DIVIDEND:

Based on the performance of the Company and the need for conservation of internal accruals for capacity expansion, your Directors have not recommended any dividend for the year 2024-25.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND & TRANSFER OF SHARES TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF):

In terms of the Companies Act, any unclaimed or unpaid Dividend relating to the financial year 2017-18, will be transferred to the Investor Education and Protection Fund established by the Central Government, after the conclusion of 32^nd Annual General Meeting.

During the year under review, Company has transferred Unpaid and Unclaimed Dividend of 2016-17 i.e. ? 1,84,150 to IEPF and Pursuant to Section 124(6) of the Companies Act, 2013 all shares in respect of which Dividend has not been paid or claimed for seven consecutive years or more has to be transfer to IEPF.

During the year under review, company has transferred 8827 Shares to IEPF.

Further shares required to be transferred to IEPF for the financial year 2017-18 to 2024-25 will be transferred as per the provisions of the Act.

The details of the said shares transferred are provided on the website of the Company at http://www.naturalcapsules.com/pages/ bes-compliance.html.

SHARE CAPITAL:

During the year under review, there was change in the Share Capital.

The Paid up share capital increased to ? 10,34,11,540 after following:

1. Preferential issue of 9,12,917 equity shares of face value of ? 10/- each.

2. Issue of 62,500 Equity shares of face Value of ? 10/- each under Employee Stock Option Plan.

3. Issue of 30,000 Equity shares of face Value of ? 10/- each under Employee Stock Option Plan.

4. Forfeiture of 13, 313 partly paid up Equity shares issued under Rights issue.

As on 31	^st March 2025 details of Share Capital is as follow:
Sl No	Particulars	Total No of Equity Shares	Face Value	Total Equity Capital
1	Authorized Capital	15,000,000	? 10/-	1,50,000,000
2	Issued & subscribed Capital	10,354,467	? 10/-	1,03,544,670
3	Paid Up Capital	10,341,154	? 10/-	1,03,411,540

* The Difference of 13,313 shares between Issued and paid up capital due to forfeiture of 13,313 partly paid up Shares. ISSUANCE OF EQUITY SHARES ON PREFERENTIAL BASIS:

Pursuant to the shareholders'' approval received at Extra-ordinary General Meeting held on August 23, 2024, your Company has issued 9,12,917 fully paid-up equity shares of face value ? 10/- (Rupees Ten only each) at an Issue price of ? 320/- (Rupees Three hundred twenty only) each including premium of ? 310/- each (Rupees Three hundred ten only) aggregating to ? 29,21,33,440/-(Rupees Twenty Nine Crores Twenty One Lakhs Thirty Three Thousand Four hundred Forty only) to Non-Promoters on Preferential basis.

FORFEITURE OF PARTLY PAID UP RIGHT EQUITY SHARES:

The Board of Directors at their meeting held on June 19, 2024 took the decision to forfeit the 13,313 partly paid-up Equity Shares on which Call Money has not been received by the company, along with the amount.

STATUS OF EXPANSION API PROJECTS:

In the Bangalore Unit, Company is yet to install two HPMC capsule units, which are expected to be completed in Financial Year 2026.

API Project of the subsidiary company got commissioned in the current year and commercial production was started towards the end of the FY 2024-25.

ANNUAL RETURN:

In terms of Section 92(3) and Section 134(3)(a) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the Annual Return is uploaded on the website of the Company web link www.naturalcapsules.com.

DEPOSITS:

Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

DETAILS OF LOANS, GUARANTEES OR INVESTMENTS:

The company has given corporate guarantees of ? 70 crores to Bank for securing loans to its subsidiary M/s Natural Biogenex Private Limited covered under the provisions of section 186 of the Companies Act, 2013. The details of the investments made by company are given in the notes to the financial statements.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Internal financial controls means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information; The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditors'' report, internal audit reports, secretarial audit reports, project reports, quarterly budgets, significant processes and accounting policies and other key issues from time to time.

DIRECTORS'' RESPONSIBILITY STATEMENT:

The Directors confirm that:

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards.

(b) They 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 of the Company at the end of the financial year and of the profit of the Company for that period;

(c) They have taken proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) They have prepared the annual accounts on a going concern basis;

(e) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively. Based on the framework of internal financial controls established and maintained by the Company, work performed by the Internal, Statutory and Secretarial Auditors, reviews performed by the management and the relevant Board Committees, the Board, in concurrence with the Audit Committee, is of the opinion that the Company''s internal financial controls were adequate and effective as on March 31, 2024.

(f) They have duly complied with Secretarial Standards issued by Institute of Company Secretaries of India (ICSI) from time to time.

INFORMATION PERTAINING TO AUDITORS AND OTHER ALLIED MATTERS:

Details In Respect of Frauds Reported By Auditors under Section 143(12) Other Than Those Which Are Reportable To the Central Government

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.

EXPLANATION AND COMMENTS ON AUDITOR REPORTS:

The reports of the Statutory Auditors (annexed elsewhere in the Annual Report) and that of the Secretarial Auditors (annexed hereto as Annexure-2) and the explanations on the observations of Secretarial Audit Report is given below:

Comments/Observations of the Secretarial Auditor:	Company''s Response/ Explanations:
Few shareholders holding 400 equity shares belonging to promoters group is yet to demat their shares.	Company is in process for getting the shares dematerialized. 200 shares were already demated as on the date of report.

STATUTORY AUDITORS:

M/s P. Chandrasekar LLP, Chartered Accountants, were appointed as the Statutory Auditors of the Company for a term of five consecutive years at the 29^th Annual General Meeting held on 20^th September 2022. However with the advent of Companies (Amendment) Act, 2017 the requirement of annual ratification of the appointment of the Statutory Auditors of the Company by the shareholders at the Annual General meeting has been done away with.

The Reports given by M/s P Chandrasekar LLP, Chartered Accountants on the standalone and consolidated Financial Statements of your Company for the financial year ended 31^stMarch 2025 ("Financial Statementsâ) is part of the Annual Report. The Notes on the Financial Statements referred to in the Auditor''s Report are self-explanatory and do not call for any comments. The Auditor''s Report does not contain any qualification, reservation, adverse remark or disclaimer.

SECRETARIAL AUDITORS:

Pursuant to the Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended from time to time) the Company has appointed Shri R. Parthasarathy, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure-2 and forms an integral part of this Report.

In terms of Regulation 24A of the Listing Regulations, with effect from 1^st April 2025, your Company is required to appoint a Practicing Company Secretary for not more than one term of five consecutive years or a firm of Practicing Company Secretaries for not more than two terms of five consecutive years, as a Secretarial Auditor, with the approval of the members at its AGM and such Secretarial Auditor must be a peer reviewed company secretary and should not have incurred any of the disqualifications as specified under the Listing Regulations. Further, as per the said Regulation, any association of the individual or the firm as the Secretarial Auditors of the Company before 31^st March 2025 shall not be considered for the purpose of calculating the tenure of the Secretarial Auditors.

Taking into account the above requirements, the Board, on the recommendation of the Audit Committee, has approved the appointment of Mr. R. Parthasarthy, Practicing Company Secretary (Firm Registration Number A 3667/CP No. 838)

as the Secretarial Auditors of the Company for a term of five consecutive years, to hold office from the conclusion of 32^ndAGM till the conclusion of 37^th AGM to be held in the year 2030, covering the period from the financial year ending 31^st March 2026 till the financial year ending 31^st March 2030, subject to the approval of the members at the ensuing 32^th AGM of your Company.

The recommendation followed a detailed evaluation of proposals received by the Company and consideration of factors such as technical capabilities, independence, industry experience, subject matter expertise, profile of audit partners and team, quality of audit practices. Your Company has received a written consent from the Secretarial Auditors that the appointment, if approved, will be in accordance with the applicable provisions of the Listing Regulations, Act and rules framed thereunder. Further, the Secretarial Auditors have confirmed that they are not disqualified to be appointed as the Secretarial Auditors of your Company.

INTERNAL AUDITORS:

M/s. Mallya & Mallya, Chartered Accountants, was appointed as Internal Auditors for the accounting year 2024-25.

COST AUDITORS AND COST RECORD:

The provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014(as amended from time to time) is currently not applicable to the company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

DECLARATION OF INDEPENDENT DIRECTORS:

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as stipulated in Section 149(6) of the Companies Act, 2013 so as to qualify themselves to act as Independent Directors under the provisions of the Companies Act, 2013 and the relevant rules.

DIRECTORS:

Shri. Satyanarayan Mundra (DIN: 00214349) and Shri. Sushil Kumar Mundra (DIN: 00214332), Directors retire by rotation and being eligible, offer themselves for re-appointment.

Shri. Satyanarayan Mundra''s tenure as Whole-Time Director is ending on September 19, 2025. Considering his immense contribution to the progress of the company as a promoter and executive director since inception, the Board recommends his reappointment for a further period of 3 years and also to revise his remuneration subject to the approval of members.

During the year under review, Shri Cattan Coletore Padmanabhan Rangachar, (DIN: 00310893) Chairman and Non-executive Independent Director) retired pursuant to completion of his tenure on August 24, 2024 from the Board of Directors. The Board wishes to place on record his immense contributions to the progress of the Company during his tenure as a Director.

During the under review, the Board had, based on the recommendation of the Nomination, Remuneration and Compensation Committee, at its meeting held on 19^th June 2024 appointed Shri. Tekkar Yashwanth Prabhu (DIN: 02113527) as an Additional Non-Executive Independent Director with effect from 19^th June 2024, to hold office for a term of five which was subsequently approved by the members at the 31^st AGM of your Company held on 26^th July 2024.

In terms of Regulation 17(1A) of SEBI Listing Regulations, consent of members by way of special resolution is required for appointment or continuation of directorship of Independent Non-Executive Director, beyond the age of 75 years. Further, Shri Tekkar Yashwanth Prabhu will attain the age of 75 years with effect from December 30, 2025 and approval of members is required for the continuation of his directorship from the day he attains the age of 75 years till the expiry of his current term. The Board considers that his continued association would be of immense benefit to the Company and it is desirable to continue to avail services of Shri Tekkar Yashwanth Prabhu as an Independent Director. Accordingly, the Board recommends his continuation as an Independent Director upon attaining the age of 75 years.

During the year under review, All independent directors have given declarations that they meet the criteria of independence as laid down under section 149 (6) of the Companies Act, 2013 and Regulation 25(3) of SeBi (Listing Obligations and Disclosure Requirement) Regulations, 2015. All Directors have given declaration relating to compliance with code of conduct.

KEY MANAGERIAL PERSONNEL ("KMP"):

Pursuant to the provisions of Section 203 of the Act, Mr. Sunil L Mundra, Managing Director, Mr. R K Prasad, Chief Financial Officer, and Mrs. Shilpa Burman, Company Secretary are the Key Managerial Personnel of your Company as on 31^st March 2025.

There was no change in Key Managerial Personnel during the year 2024-25.

During the current year, Mrs. Shilpa Burman resigned from the Position of Company Secretary & Compliance Officer w.e.f May 07, 2025. On the recommendation of Nomination, Remuneration and Compensation Committee the Board of Directors appointed Ms. Pranjal Deshmukh as Company Secretary & Compliance Officer w.e.f May 29,2025.

NOMINATION AND REMUNERATION & COMPENSATION COMMITTEE AND POLICY:

As per the requirements of the provisions of the Companies Act, 2013, a Nomination and Remuneration & Compensation Committee of Directors was constituted by the Board of Directors and the details of the Members of the Committee are disclosed elsewhere in this Annual Report. The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy on Director''s appointment and remuneration including criteria for determining qualification, positive attributes, independence of a Director and other matters provided under sub-section (3) of Section 178. The said Policy is available on the website of the Company, various web links of the company''s policy is detailed under the head Policy.

RELATED PARTY TRANSACTIONS:

During the financial year ended March 31,2025, all the contracts or arrangements or transactions entered into by the Company with the related parties were in the ordinary course of business and on ''arm''s length'' basis and were in compliance with the applicable provisions of the Companies Act, 2013, read with Regulation 23 of SEBI (LODR), 2015.

The Policy on Related Party Transactions (including the revised policy applicable for related party transactions effective April 01, 2019), is available on the Company''s website and can be accessed at http://www.naturalcapsules.com/pdf/policy-on-related-party-transactions.pdf.

All related-party transactions are placed before the Audit Committee for review and approval. Prior omnibus approval of the Audit Committee and the Board is obtained for the transactions which are of a foreseen and repetitive nature. A statement giving details of all related-party transactions is placed before the Audit Committee for their noting/approval every quarter. As prescribed by Section 134 (3) (h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, particulars of material contracts/ arrangements with related parties are given in Form AOC-2, annexed as Annexure-1 to this report.

All related party transactions are mentioned in the notes to the accounts. The Directors draw attention of the members to the Notes to the financial statements which sets out the disclosure for related party transactions.

MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY FROM THE END OF FINANCIAL YEAR TILL THE DATE OF THIS REPORT:

There are no any material changes and commitments occurred between the end of the financial year ended as on 31^st March, 2025 and the date of the report which can affect the financial position of the company.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and Outgo as required under section 134 (3) (m) of the Companies Act,

2013 read with Rule 8(3) of the Companies (Accounts) Rules,

2014 (as amended from time to time) is attached herewith as Annexure-3 to this report.

RISK MANAGEMENT:

The Company follows a comprehensive and integrated risk management process. The risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making and are periodically reviewed and revised by the Board of Directors.

CORPORATE SOCIAL RESPONSIBILITY:

During the financial year ended 31^st March 2025, the CSR Committee constitute Shri Pramod Kasat (Chairperson), Shri Sunil L Mundra (Member) and Shri Sushil Kumar Mundra (Member). The terms of reference of the CSR Committee are provided in the Corporate Governance Report, which forms an integral part of this Report. Your Company has also formulated a CSR Policy, which is available on the website of your Company at http://naturalcapsules.com/pages/policies.html.

The Annual Report on Company''s CSR activities of the Company is furnished in the prescribed format as Annexure-4 and attached to this report.

BOARD EVALUATION:

The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and that of its committees and individual directors. Schedule IV of the Companies act, 2013, states that the performance evaluation of independent directors shall be done by the entire Board of Directors, excluding the director being evaluated. Pursuant to the provisions of the Act, the Board has carried out an annual evaluation of its own performance, the individual Directors (including the Chairman) as well as an evaluation of the working of all Board Committees. The performance evaluation was carried out on the basis of inputs received from all the Directors/ Members of the Committees, as the case may be.

The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results of evaluation have been communicated to the Chairman of the Board of Directors.

SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, mandates that the Board shall monitor and review the Board evaluation framework. The framework includes the evaluation of directors on various parameters such as:

â¢ Board dynamics and relationships

â¢ Information flows

â¢ Decision-making

â¢ Relationship with stakeholders

â¢ Company performance and strategy

â¢ Tracking Board and committees effectiveness

â¢ Peer evaluation

The evaluation process has been explained in the corporate governance report. The Board approved the evaluation results as collated by the nomination and remuneration committee.

FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS:

Pursuant to provisions of Regulation 25(7) of the SEBI Listing Regulations, a detailed familiarization program was held on 12^th November 2024 and 29^th March 2025. The detail of familiarization program is available at website of your Company at www.naturalcapsules.com.

CORPORATE GOVERNANCE:

Pursuant to Regulation 34 of the SEBI (LODR) Regulations, 2015, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance provided in Annexure-5 in this Report and the same forms part of the Directors'' Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Management Discussion and Analysis Repot for the year under review as stipulated under Regulation 34(2) (e) of SEBI (LODR) Regulations, 2015,forms part of the Annual Report.

COMPOSITION OF AUDIT COMMITTEE AND VIGIL MECHANISM/WHISTLE BLOWER POLICY:

As on 31^st March 2025 the Committee constitutes of Mr. T Y Prabhu (Chairperson), Mr. Pramod Kasat (Member), Mr. S G Belapure (Member) & Mr. Sunil L Mundra (Member), details of which are enumerated in the Corporate Governance Report. The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and the policy is explained in corporate governance report. During the year under review, there were no complaints received under this mechanism.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaint Committee has been set up to redress complaints received. All employees (permanent, contractual, temporary, trainees) are covered under this policy. There were no complaints received from any employee during the financial year 2024- 25.

Number of complaints of sexual harassment 0

received in the year

Number of complaints disposed off during the year 0 Number of cases pending for more than ninety days 0

OTHER DISCLOSURE:

a) details of establishment of vigil mechanism, whistle blower policy, and affirmation that no personnel has been denied access to the audit committee;

b) details of compliance with mandatory requirements and adoption of the non-mandatory requirements;

c) web link where policy for determining ''material'' subsidiaries is disclosed;

d) web link where policy on dealing with related party transactions;

e) a certificate from a company secretary in practice that none of the directors on the board of the company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority.

PARTICULARS OF EMPLOYEES:

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 has been appended as Annexure-6 to this Report.

EMPLOYEE STOCK OPTION SCHEMES:

Pursuant to Rule 12(9) of the Companies (Share Capital and Debentures) Rules, 2014 read with Regulation 14 of the SEBI (Share Based Employee Benefits) Regulations, 2014 The Company has implemented ESOP Scheme 2018, to reward and retain the qualified and skilled employees and to give them an opportunity to participate in the growth of the Company. These Schemes are administered by the Nomination, Remuneration

and Compensation Committee of the Company has been appended as Annexure-7 to this Report.

The details of the Plan form part of the notes to accounts of the Financial Statements in this Annual Report.

DISCLOSURE UNDER SCHEDULE V(F) OF THE SEBI(LODR) REGULATIONS, 2015:

Your Company does not have shares in the demat suspense account or unclaimed suspense account.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES:

The Company has 2 subsidiaries M/S Natural Biogenex Private Limited & M/S Natural Phyto Pharma Private Limited.

UNCLAIMED DIVIDEND

Pursuant to Section 125 of the Companies Act, 2013, dividends that are unpaid/ unclaimed for a period of 7 (Seven) years from the date they became due for payment are required to be transferred by the Company to the Investor Education and Protection Fund (IEPF/ Fund). Given below are the dates of declaration of dividend and corresponding cut-off dates when unpaid/unclaimed dividends are due for transfer to IEPF:

Year	Type of Dividend	Dividend Per Share	Date of Declaration of Dividend	cut-off date for transfer to IEPF
2018	Final Dividend	'' 1/- Per Share	21^st September 2018	28^th October 2025
2019	Final Dividend	'' 1/- Per Share	22^nd August 2019	29^th September 2026
2020	Final Dividend	'' 1/- Per Share	21^st August 2020	28^th September 2027
2021	Final Dividend	'' 1/- Per Share	15^th July 2021	22^nd August 2028
2022	Final Dividend	'' 1/- Per Share	20^th September 2022	27^th October 2029
2023	Final Dividend	'' 1/- Per Share	28^th July 2023	4^th September 2030
2024	Final Dividend	NIL	NA	NA

Members who have till date not encashed their dividend warrants are requested to write to the Company/Cameo, RTA to claim the same, on or before cut-off dates given above,to avoid transfer of dividend to IEPF.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an adequate Internal Control System commensurate with its size and operations. Management has overall responsibility for the Company''s Internal Control System to safeguard the assets and to ensure reliability of financial records. Audit Committee reviews all financial statements and ensures adequacy of internal control systems. The Company has engaged the services of an Independent Chartered Accountant to carry out the internal audit and ensure that recording and reporting are adequate and proper, the internal controls exist in the system and that sufficient measures are taken to update the internal control system. The system also ensures that all transaction are appropriately authorized, recorded and reported. Exercises for safeguarding assets and protection against unauthorized use are undertaken from time to time. The company has also installed an extensive CCTV Surveillance system to cover the entire factory premises. All these measures are continuously reviewed by the management and as and when necessary improvements are affected.

DISCUSSIONS ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:

The Net Sales during the year was ? 16,793.82 Lakh and your Company could make Net Profit of ? 632.62 Lakh after tax.

NO. OF EMPLOYEES:
	31-	03-2025			31-	03-2024
PLACE	REGULAR	TRAINEE	TOTAL	PLACE	REGULAR	TRAINEE	TOTAL
HO	29	0	29	HO	30	0	30
UNIT-1	69	0	69	UNIT-1	64	0	64
UNIT-2	73	0	73	UNIT-2	75	0	75
UNIT-3	0	0	0	UNIT -3	0	0	0

CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING:

As per the SEBI (Prohibition of Insider Trading) Regulations, 2015 ("PIT Regulationsâ), your Company has adopted a "Code of Conduct for Prevention of Insider Trading in Securitiesâ (the "Codeâ) and "Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information ("UPSIâ)â. All the Directors, employees and third parties such as auditors, consultants etc., who could have access to UPSI related to the Company, are governed by the Code. The trading window is closed as per the PIT Regulations during the time of declaration of financial results and occurrence of any material events as per the Code.

CREDIT RATING:

The details of credit rating are disclosed in the Corporate Governance Report, which forms part of the Integrated Annual Report.

CAUTIONARY STATEMENT:

Statements in the Board''s Report and the Management Discussion & Analysis describing the Company''s objectives, expectations or forecasts may be forward looking within the meaning of applicable laws and regulations. Actual results may differ from those expressed in the statements.

OTHERS:

1. During the financial year ended 31^st March 2025, your Company has complied with applicable Secretarial Standards i.e. SS-1 and SS-2, relating to "Meetings of the Board of Directorsâ and "General Meetingsâ, respectively.

2. The Company does not have any scheme of provision of money for the purchase of its own shares by employees or by trustees for the benefits of employees;

GENERAL:

Your Directors confirm that no disclosure or reporting is required in respect of the following items as there was no transaction on these items during the year under review:

a) Issue of equity shares with differential voting rights as to dividend, voting or otherwise.

b) Issue of Shares (Including Sweat Equity Shares) to employees of your Company under any scheme.

c) No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

d) The Company has not made any application nor any proceedings is pending under the Insolvency and Bankruptcy Code, 2016 during the year.

e) One time settlement of loan obtained from the Banks or Financial Institutions.

f) Revision of financial statements and Directors'' Report of your Company.

ACKNOWLEDGEMENT:

Your Directors express gratitude to all stakeholders, including customers, bankers, suppliers, distributors, dealers, and contractors, for their ongoing assistance, cooperation, and support. They also extend sincere appreciation to all employees for their dedication and ongoing contributions to the Company. The Directors are thankful for the confidence, faith, and trust shown by shareholders in the Company. Additionally, appreciation is extended to the Central Government and the Government of Karnataka for their continual support and cooperation.

Mar 31, 2024

The Directors have pleasure in presenting their 31^st Annual Report together with the Audited Accounts of the Company for the year ended March 31, 2024.

FINANCIAL RESULTS:

The Company''s financial performance, for the year ended March 31, 2024 is summarized here below:

(Rs. in Lakhs)
Particulars	Standalone		Consolidated
	Financial Year	Financial Year	Financial Year	Financial Year
	2023-24	2022-23	2023-24	2022-23
Gross Sales	17,195.94	20,525.52	17,387.19	20,476.14
Less: GST	1,815.31	3,238.72	1,845.19	3,238.72
Net Sales	15,380.63	17,286.80	15,542.00	17,237.42
Other Income	314.57	106.59	193.62	56.54
Total	15,695.20	17,393.39	15,735.62	17,293.96
Profit before Depreciation & Taxation	1,896.32	3,294.09	1,671.97	3,220.08
Less: Depreciation	856.85	719.61	866.78	720.81
Less: Provision for Current Tax	197.13	545.77	197.13	545.77
Less: Prior Period Adjustment		-	-	-
Less: Deferred Tax Liability	61.84	108.88	52.71	108.88
Add: Exceptional Items-Income/(Expense)	-	-	-	-
Add: Other Comprehensive Income/(Expense)	26.08	(6.48)	26.08	(6.48)
Profit after Taxation	806.58	1,913.35	581.43	1,838.14
Add: Balance b/f from Previous Year	7,335.57	5,585.92	7,252.88	5,578.44
Surplus available for Appropriation	8,142.15	7,499.27	7,834.31	7,416.58
Appropriations	-	-	-	-
General Reserve	-	-	-	-
Proposed Dividend	-	92.76	-	92.76
Tax on Dividend	-	-	-	-
Additional Depreciation on Fixed Asset as per Companies Act, 2013	-	-	-	-
Balance carried to Balance Sheet	8,142.15	7,406.51	7,834.31	7,323.82

THE CHANGE IN THE NATURE OF BUSINESS, IF ANY:

There was no change in the nature of business for the period under review.

TRANSFER TO RESERVES:

The Company does not propose to transfer any amount to the General Reserves.

DIVIDEND:

Based on the performance of the Company and the need for conservation of internal accruals for capacity expansion, your Directors have not recommended any dividend for the year 2023-24.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND & TRANSFER OF SHARES TO INVESTOR EDUCATION AND PROTECTION FUND:

In terms of the Companies Act, any unclaimed or unpaid Dividend relating to the financial year 2016-17, will be transferred to the Investor Education and Protection Fund established by the Central Government, after the conclusion of 31^st Annual General Meeting.

Pursuant to Section 124(6) of the Companies Act, 2013 all shares in respect of which Dividend has not been paid or claimed for seven consecutive years or more has been transferred to IEPF. Further shares required to be transferred to IEPF for the financial year 2016-17 to 2023-24 will be transferred as per the provisions of the Act.

The details of the said shares transferred are provided on the website of the Company at http://www.naturalcapsules.com/ pages/bes-compliance.html.

SHARE CAPITAL:

During the year under consideration, there was change in the paid up capital. During December, 2021, the Company had issued rights shares of 31,16,350 partly paid equity shares

face value of ? 10/- each for cash at a price of ? 100/- each right equity share including premium of ? 90/- per rights equity shares, resulting into change in equity share capital to ? 9,33,17,643/- Comprising of 93,21,578 Equity Shares of ? 10/-each fully paid, 13,273 Equity shares of ? 10/- each paid up ? 5/- each and 14,199 equity shares of ? 10/- each paid up ? 2.50/- each as on March 31, 2024.

STATUS OF EXPANSION & API PROJECTS:

During the year Company has installed 1 HPMC capsule making machine at Bengaluru unit, resulting in increase of installed capacity of the Company from 16.02 billion to 18.75 billion capsules per annum.

Construction is on full swing in the API project of the Company which is being implemented by its subsidiary M/s Natural Biogenex Private Limited. We are expecting to start the trial productions by 2^nd quarter of the financial year 2024-25.

EXTRACT OF ANNUAL RETURN:

Pursuant to Section 92(3) and Section 134(3)(a) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return is uploaded on the website of the Company web link www.naturalcapsules.com.

BOARD MEETINGS AND ITS COMMITTEES CONDUCTED DURING THE PERIOD UNDER REVIEW:
Board Meeting Number	Date of Board Meeting	Board Strength	No. of Director''s Present
151^st	Saturday, April 22, 2023	8	7
152^nd	Friday, May 26, 2023	8	8
153^rd	Wednesday, August 09, 2023	8	8
154^th	Saturday, September 23, 2023	8	8
155^th	Thursday, November 09, 2023	8	7
156^th	Friday, February 09, 2024	8	8
Further details of the same	have been enumerated in the Corporate Governance Report annexed in Annexure-5 to this report.

DEPOSITS:

Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

DETAILS OF LOANS, GUARANTEES OR INVESTMENTS:

The Company has given corporate guarantees of ? 70/- Crores to its subsidiary M/s Natural Biogenex Private Limited covered under the provisions of Section 186 of the Companies Act, 2013. The details of the investments made by Company are given in the notes to the financial statements.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

Internal financial controls means the policies and procedures adopted by the Company for ensuring the orderly and efficient

conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information; The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditors'' report, internal audit reports, secretarial audit reports, project repots, quarterly budgets, significant processes and accounting policies and other key issues from time to time.

DIRECTORS'' RESPONSIBILITY STATEMENT:

The Directors confirm that:

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards;

(d) They have prepared the annual accounts on a going concern basis;

(e) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively. Based on the framework of internal financial controls established and maintained by the Company, work performed by theInternal, Statutory and Secretarial Auditors, reviews performed by the management and the relevant Board Committees, the Board, in concurrence with the Audit Committee, is of the opinion that the Company''s internal financial controls were adequate and effective as on March 31,2024;

(f) They have duly complied with Secretarial Standards issued by Institute of Company Secretaries of India (ICSI) from time to time.

INFORMATION PERTAINING TO AUDITORS AND OTHER ALLIED MATTERS:

Details In Respect of Frauds Reported By Auditors under Section 143(12) Other Than Those Which Are Reportable To the Central Government

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.

EXPLANATION AND COMMENTS ON AUDITOR REPORTS:

Comments/Observations of the Secretarial Auditor	Company''s Response/ Explanations
Few shareholders holding 400 equity shares belonging to promoters group is yet to demat their shares.	Company is in process for getting the shares dematerialized

Comments/Observations of the Secretarial Auditor	Company''s Response/ Explanations
Delay in filing of few MCA forms	Due to technical issue. However, the forms were filed with additional fee

STATUTORY AUDITORS:

M/s P. Chandrasekar LLP, Chartered Accountants, were appointed as the Statutory Auditors of the Company for a term of five consecutive years at the 29^th Annual General Meeting held on September 20, 2022. However with the advent of Companies (Amendment) Act, 2017 the requirement of annual ratification of the appointment of the Statutory Auditors of the Company by the shareholders at the Annual General meeting has been done away with.

SECRETARIAL AUDITORS:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended from time to time) the Company has appointed Shri R. Parthasarathy, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure-2.

COST AUDITORS:

The provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014 (as amended from time to time) is currently not applicable to the Company.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS:

There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.

DECLARATION OF INDEPENDENT DIRECTORS:

DIRECTORS:

Shri.Laxminarayan Moondra and Smt. Jyoti Mundra, Directors retire by rotation and being eligible, offer themselves for re appointment.

Mr. Sunil Laxminarayana Mundra tenure as Managing director is ending on May 31, 2024 Considering his immense contribution to the progress of the Company as a promoter and executive director since inception, the Board recommends his reappointment for a further period of 5 years and also to revise his remuneration subject to the approval of members.

Mr. Pramod Kasat tenure as Independent Director ended on April 30, 2024. The Nomination remuneration and

Compensation Committee recommended the re-appointment of Shri. Pramod Kasat for a second term of five years with effect from May 01, 2024 (subject to shareholders approval) and that his tenure of appointment shall not be liable to retire by rotation.

Further, Considering the vast business experience and qualification, Mr. Tekkar Yashwanth Prabhu has been appointed as an Additional Non-Executive Independent Director with effect from June 19, 2024, for a term of 5 years subject to the approval of the shareholders.

During the year under consideration All independent directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 25(3) of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015. All Directors have given declaration relating to compliance with code of conduct.

NOMINATION AND REMUNERATION & COMPENSATION COMMITTEE AND POLICY:

As per the requirements of the provisions of the Companies Act, 2013, a Nomination and Remuneration & Compensation Committee of Directors was constituted by the Board of Directors and the details of the Members of the Committee are disclosed elsewhere in this Annual Report. The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy on Director''s appointment and remuneration including criteria for determining qualification, positive attributes, independence of a Director and other matters provided under sub-section (3) of Section 178. The said Policy is available on the website of the Company, various web links of the Company''s policy is detailed under the head Policy.

RELATED PARTY TRANSACTIONS:

During the financial year ended March 31, 2024, all the contracts or arrangements or transactions entered into by the Company with the related parties were in the ordinary course of business and on ''arm''s length'' basis and were in compliance with the applicable provisions of the Companies Act, 2013, read with Regulation 23 of SEBI (LODR), 2015.

All related-party transactions are placed before the Audit Committee for review and approval. Prior omnibus approval of the Audit Committee and the Board is obtained for the transactions which are of a foreseen and repetitive nature. A statement giving details of all related-party transactions is placed before the Audit Committee for their noting/approval every quarter. As prescribed by Section 134(3)(h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014, particulars of material contracts/ arrangements with related parties are given in Form AOC-2, annexed as Annexure-1 to this report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:

There is no any material changes and commitments occurred between the end of the financial year ended as on March 31, 2024 and the date of the report which can affect the financial position of the Company.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO:

The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and Outgo as required under Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 (as amended from time to time) is attached herewith as Annexure-3 to this report.

RISK MANAGEMENT:

CORPORATE SOCIAL RESPONSIBILITY:

The CSR Committee members are Shri Pramod Kasat, Shri Sunil L Mundra and Shri Sushil Kumar Mundra. The Annual Report on Company''s CSR activities of the Company is furnishedin the prescribed format as Annexure-4 and attached to this report.

BOARD EVALUATION:

The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and that of its committees and individual directors. Schedule IV of the Companies Act, 2013, states that the performance evaluation of independent directors shall be done by the entire Board of Directors, excluding the director being evaluated. Pursuant to the provisions of the Act, the Board has carried out an annual evaluation of its own performance, the individual Directors (including the Chairman) as well as an evaluation of the working of all Board Committees. The performance evaluation was carried out on the basis of inputs received from all the Directors/Members of the Committees, as the case may be.

The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results

of evaluation have been communicated to the Chairman of the Board of Directors.

â¢ Board dynamics and relationships;

â¢ Information flows;

â¢ Decision-making;

â¢ Relationship with stakeholders;

â¢ Company performance and strategy;

â¢ Tracking Board and committees effectiveness;

â¢ Peer evaluation.

The evaluation process has been explained in the corporate governance report. The Board approved the evaluation results as collated by the nomination and remuneration committee.

CORPORATE GOVERNANCE:

Pursuant to Regulation 34 of the SEBI (LODR) Regulations, 2015, Report on Corporate Governance, Management Discussion and Analysis Report and Auditors Certificate regarding compliance of conditions of Corporate Governance provided in Annexure-5 in this Report and the same forms part of the Directors'' Report.

COMPOSITION OF AUDIT COMMITTEE AND VIGIL MECHANISM/WHISTLE BLOWER POLICY:

The present Committee members are Mr. C P Rangachar, Mr. Pramod Kasat, Mr. S G Belapure & Mr. Sunil L Mundra, details of which are enumerated in the Corporate Governance Report. The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and the policy is explained in corporate governance report. During the year under review, there were no complaints received under this mechanism.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013:

OTHER DISCLOSURE:

a) details of establishment of vigil mechanism, whistle blower policy, and affirmation that no personnel has been denied access to the audit committee;

b) details of compliance with mandatory requirements and adoption of the non-mandatory requirements;

c) web link where policy for determining ''material''

subsidiaries is disclosed;

d) web link where policy on dealing with related

party transactions;

e) a certificate from a Company secretary in practice that none of the directors on the board of the Company have been debarred or disqualified from being appointed or continuing as directors of companies by the Board/Ministry of Corporate Affairs or any such statutory authority.

PARTICULARS OF EMPLOYEES:

EMPLOYEE STOCK OPTION SCHEMES:

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES:

The Company has 2 subsidiaries- M/S Natural Biogenex Private Limited & M/S Natural Phyto Pharma Private Limited.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has an adequate Internal Control System commensurate with its size and operations. Management has overall responsibility for the Company''s Internal Control System to safeguard the assets and to ensure reliability of financial records. Audit Committee reviews all financial statements and ensures adequacy of internal control systems. The Company has engaged the services of an Independent Chartered Accountant to carry out the internal audit and ensure that recording and reporting are adequate and proper, the internal controls exist in the system and that sufficient measures are taken to update the internal control system. The system also ensures that all transaction are appropriately authorized, recorded and reported. Exercises for safeguarding assets and protection against unauthorized use are undertaken from time to time. The Company has also installed an extensive CCTV Surveillance system to cover the entire factory premises. All these measures are continuously reviewed by the management and as and when necessary improvements are affected.

Mar 31, 2018

The Directors have pleasure in presenting their 25^th Twenty Fifth Annual Report together with the Audited Accounts of the company for the year ended 31^st March 2018.

Financial results:

The Companyâs financial performance, for the year ended is31^st March 2018.Summarized below:

(Rs. In Lakhs)

Particulars	31^stMarch, 2018	31 ^stMarch,2017
Gross Sales	6460.69	6122.96
Less : Excise duty& GST	985.17	758.69
Net Sales	5475.52	5364.27
Other Income	81.48	81.29
Total	5557.01	5445.57
Profit before depreciation & taxation	601.47	526.64
Less : Depreciation	433.25	431.75
Less : Provision for taxation	84.84	0
Less: Prior period adjustment (Taxation)	0	0.43
Add: Deferred Tax withdrawn	-27.72	-31.64
Profit after taxation	111.11	62.78
Add: Balance brought forward from previous year/Other Equity	4809.11	4772.98
Surplus available for appropriation
Appropriations
General Reserve
Proposed Dividend	62.33	62.33
Tax on Dividend	12.69	12.69
Additional depreciation on fixed asset as per Companies Act, 2013
Balance carried to Balance sheet	4809.11	4772.98
Total	4884.13	4848.00

The Change in the Nature of Business, if any:

There was no change in nature of business for the period under review.

Transfer to reserves:

The company does not propose to transfer any amount to the General Reserves.

Dividend:

Based on the performance of the Company and the need for conservation of internal accruals, while maintaining the dividend for the shareholders, your Directors are pleased to recommend a final dividend of Rs. 1 per equity share at the rate of 10 % subject to the approval of members. The dividend, if approved by the Members, will result in the out flow of Rs.62.33 lakhs from the company in addition to Rs. 12.69 lakhs by way of dividend distribution tax. Dividend if declared will be paid to the Members whose names appear in the Register of Members as on the record date as on 14^th September 2018. Transfer of Unclaimed Dividend to Investor Education and Protection Fund

In terms of the Companies Act, any unclaimed or unpaid Dividend relating to the financial year 2010-11, will be transferred to the Investor Education and Protection Fund established by the Central Government, after the conclusion of 25^thAnnual General Meeting.

Share capital:

During the year under consideration, there was no change in the paid up capital. The present share capital stands at Rs. 6,23,27,000 Comprising of 62,32,700 Equity Shares of Rs. 10/- only each. Further, the company has not made any fresh issue of shares for the Financial Year 2017-18.

Extract of Annual Return:

As per the requirements of the Companies Act, 2013, the extract of annual return in the prescribed Form MGT 9 is annexed hereto as Annexure - 1 forming part of this report.

Board Meetings and Its Committees Conducted During The Period Under Review:

Board Meeting No. Present	Date of Board Meeting	Board Strength	No. of Directorâs
120^th	Saturday, 27th May 2017	8	6
121^st	Wednesday, 9th August 2017	8	8
122^nd	Saturday, 04th November 2017	8	7
123^rd	Monday, 29th January 2018	8	7

Further details of the same have been enumerated in the Corporate Governance Report annexed in Annexure-5to this report.

Fixed Deposits:

Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

Particulars of Loans, Guarantees or Investments:

The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013. The details of the investments made by company are given in the notes to the financial statements.

Internal control systems and their adequacy:

Internal financial controls means the policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including adherence to companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information; The Company has adequate internal control systems to monitor business processes, financial reporting and compliance with applicable regulations. The systems are periodically reviewed for identification of control deficiencies and formulation of time bound action plans to improve efficiency at all the levels. The Audit Committee of the Board constantly reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the Company and recommendations made for corrective action through the internal audit reports. The Committee reviews the statutory auditorsâ report, internal audit reports, secretarial audit reports, project repots, quarterly budgets, significant processes and accounting policies and other key issues from time to time.

Directorsâ Responsibility Statement

The Directors confirm that -

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures from those standards.

(d) They have prepared the annual accounts on a going concern basis;

(e) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively. Based on the framework of internal financial controls established and maintained by the Company, work performed by the Internal, Statutory and Secretarial Auditors, reviews performed by the management and the relevant Board Committees, the Board, in concurrence with the Audit Committee, is of the opinion that the Companyâs internal financial controls were adequate and effective as on March 31, 2018.

(f) They have duly complied with Secretarial Standards issued by Institute of Company Secretaries of India (ICSI) from time to time.

Information Pertaining to Auditors and Other Allied Matters:-

Details In Respect Of Frauds Reported By Auditors under Section 143(12) Other Than Those Which Are Reportable To the Central Government

There were no instances of frauds identified or reported by the Statutory Auditors during the course of their audit pursuant to Section 143(12) of the Companies Act, 2013.

Explanation and Comments on Auditor Reports:

The reports of the Statutory Auditors (annexed elsewhere in the Annual Report) and that of the Secretarial Auditors (annexed hereto as Annexure - 2)and the explanations on the observations of Secretarial Audit Report is given below:

Comments/Observations of the Secretarial Auditor:	Companyâs Response/Explanations:
a) The Company has not provided/spent the amount as prescribed under sec. 135 of the Companies Act 2013 and the rules framed thereunder, relating to Corporate Social Responsibility.	The company has spent part amount of Rs.1.5 Lakhs and is in the process of identifying proper areas of CSR.
b) There were some delays in filing of some of the e-forms with the Registrar of Companies.	Due to technical snag in the system, there was a delay in filing few e-forms with the Registrar of Companies, however the same was filed with additional fees and there was no instance of penalty/compounding.
c) The Company has received notice from Bombay Stock Exchange for delayed filing of some of the returns as per SEBI LODR Regulations, 2015 for non-compliance for earlier period 2013 to 2016 levying total penalty of Rs 49450/- which has since been paid by the Company.	The said delay was due to inadvertence and the penalty was paid within stipulated time.

Statutory Auditors:

M/sP. ChandrasekarLLP, Chartered Accountants, were appointed as the Statutory Auditors of the Company for a term of five consecutive years at the 24^thAnnual General Meeting held on 29^th August 2017 subject to annual ratification by shareholders. However with the advent of Companies (Amendment) Act, 2017 the requirement of annual ratification of the appointment of the Statutory Auditors of the Company by the shareholders at the Annual General meeting has been done away with. Accordingly,

M/s P. ChandrasekarLLP, Chartered Accountants will continue to be the Statutory Auditors of the Company for the FY 2018-19 and thereafter, hence, no resolution is proposed for ratification of the appointment of Auditors, who were appointed at the Annual General Meeting, held on 29^th August 2017.

Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (as amended from time to time) the Company has appointed SriR. Parthasarathi, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure - 2.

Cost Auditors

Significant and Material Orders Passed By the Regulators or Courts:

There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

Declaration of Independent Directors:

Directors:

Shri.Laxminarayan Mundra and Smt. Jyoti Mundra, Directors retire by rotation and being eligible, offer themselves for re appointment.

All independent directors have given declarations that they meet the criteria of independence as laid down under section 149 (6) of the Companies Act, 2013 and Regulation 25(3) of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015. All Directors have given declaration relating to compliance with code of conduct.

Nomination and Remuneration Committee and Policy:

As per the requirements of the provisions of the Companies Act, 2013, a Nomination and Remuneration Committee of Directors was constituted by the Board of Directors and the details of the Members of the Committee are disclosed elsewhere in this Annual Report. The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy on Directorâs appointment and remuneration including criteria for determining qualification, positive attributes, independence of a Director and other matters provided under sub-section (3) of Section 178. The said Policy is available on the website of the Company, various web links of the companyâs policy is detailed under the head Policy.

Related Party Transactions:

All transactions of the Company with the related parties were in the ordinary course of business and on an armâs length pricing basis. There were no material significant related party transactions having potential conflict with the interest of company.

Name of the related party and nature of relationship where control exists:

Name of Related Party Nature of Relationship

M/s Mundra Enterprises Entity in which Director or KMP is related:

Shri.Sunil L Mundra

Shri.Laxminarayan Mundra

Shri.Sathyanaraya Mundra

(B) (i) Related Party Transactions:

Name of Related Party	Nature of Transaction	Amount of Transaction	Amount Outstanding at the end of year Credit (Rs.) Debit (Rs.) Current Year Current Year (Previous Year) (Previous Year)
M/s Mundra Enterprises	Operating Lease Rental Payments	6,48,000	58,320

Material Changes and Commitments Affecting the Financial Position ofthe Company:

There is no material change or commitments after the closure of the financial year as on 31^st March 2018 and till the date of this report.

Conservation Of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo:

The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and Outgoas required under section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts)Rules, 2014 (as amended from time to time) is attached herewith as Annexure - 3 to this report.

Risk Management:

Corporate Social Responsibility:

The Board has constituted a CSR Committee comprising of Shri Dr. C.M.Gurumurthy,Shri Sunil L Mundraand ShriSushil Kumar Mundra. The Annual Report on Companyâs CSR activities of the Company is furnished in the prescribed format as Annexure - 4 and attached to this report.

Board Evaluation:

The Independent Directors of the Company have also convened a separate meeting for this purpose. All the results of evaluation have been communicated to the Chairman of the Board of Directors.

- Board dynamics and relationships

- Information flows

- Decision-making

- Relationship with stakeholders

- Company performance and strategy

- Tracking Board and committees effectiveness

- Peer evaluation

The evaluation process has been explained in the corporate governance report. The Board approved the evaluation results as collated by the nomination and remuneration committee.

Corporate Governance:

Pursuant to Regulation 34 of the SEBI (LODR) Regulations, 2015, Management Discussion and Analysis Report, Report on Corporate Governance and Auditors Certificate regarding compliance of conditions of Corporate Governance provided in Annexure-5 in this Report and the same forms part of the Directorsâ Report.

Composition of Audit Committee and Vigil Mechanism / Whistle Blower Policy:

The Board has constituted an Audit Committee, details of which are enumerated in the Corporate Governance Report. The Company has devised a vigil mechanism in the form of a Whistle Blower Policy in pursuance of provisions of Section 177(10) of the Companies Act, 2013 and the policy is explained in corporate governance report. During the year under review, there were no complaints received under this mechanism.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013:

The Company has in place a policy on Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Compliant Committee has been set up to redress complaints received. All employees (permanent, contractual ,temporary, trainees) are covered under this policy. There were no complaints received from any employee during the financial year 2017 - 18.

Particulars of Employees:

Subsidiaries, Joint Ventures and Associate Companies:

The Company does not have any joint venture, subsidiary or associate company.

Management Discussion and Analysis Report:

Industry structure and developments:

During the year under review, Indian Pharma Industry has faced challenges in both domestic and international fronts. However despite these challenges, industry has grown by around 3 %. On domestic front, industry faced challenges due to Introduction of GST during first quarter of Financial Year-2018; price control on many finished formulations had impacted the industry. Bigger Pharma companies had faced challenges of pricing in regulated markets, however stiff competition in these markets has given increased market share to Indian companies who have been more adept in handling the pricing pressure. At the same time exports to other countries were affected due to challenges of currency depreciation, hard currency availability etc. Your company during the Financial Year 2017-18 had a gross turnover of Rs. 5232.32Lakhs as against Rs. 5136.66Lakhs in the previous year, a marginal growth of 1.82%. Profit before depreciation and taxation was Rs. 168.22 Lakhs as against Rs.90.00 lakhs in the previous year. The net profit of the Company for the year under review was placed at Rs. 111.111Lakhs as against Rs. 62.78Lakhs previous year. Due to continuing challenges on export front and pricing pressure in domestic front and increase in other input costs, margins remained in lower percentages. Despite these challenges Profit after tax has increased by 43.49 % during the year under review.

Opportunities and threats:

a). Opportunities

1. Opening of export opportunities for HPMC capsules in various countries.

2. Increase in demand for HPMC capsules within the country due to trend of conversion of many products from gelatin to HPMC capsules.

3. New dosage formulations using hard capsules.

4. Companyâ new API project will market products which are currently being imported and hence will have good demand and margins.

b). Threats:

1. Aggressive expansion & price competition from Chinese suppliers.

2. Increase in prices of raw material due to short supply in domestic market and higher import costs due to devaluation of Indian currency.

3. Slowdown in exports due to challenges in international economy.

Segment -wise or product wise performance is not relevant in view of the company having single product.

c). Outlook:

Based on the companyâs performance up to the date of this report, orders on hand and realizing the incremental capacity post up gradation of machines, your company is hopeful of achieving a turnover of around Rs. 58 to 60 crores in the current year. However due to increase in input costs, company may still earn lower margins as compared to earlier years. New API project once commissioned will give a big boost to companyâs revenue and profits.

d.) Risks & Concerns

Risk of competition and exchange fluctuations may have an adverse impact on the projections. Risk of delay in receiving payments for both local & international customers can lead to higher finance cost. Risk of short supplies of raw material can cause loss of business to some extent. Internal Control Systems and Their Adequacy:

The Company has an adequate Internal Control System commensurate with its size and operations. Management has overall responsibility for the Companyâs Internal Control System to safeguard the assets and to ensure reliability of financial records. Audit Committee reviews all financial statements and ensures adequacy of internal control systems. The Company has engaged the services of an Independent Chartered Accountant to carry out the internal audit and ensure that recording and reporting are adequate and proper, the internal controls exist in the system and that sufficient measures are taken to update the internal control system. The system also ensures that all transaction are appropriately authorized, recorded and reported. Exercises for safeguarding assets and protection against unauthorized use are undertaken from time to time. The company has also installed an extensive CCTV Surveillance system to cover the entire factory premises. All these measures are continuously reviewed by the management and as and when necessary improvements are affected.

Discussions on financial performance with respect to operational performance:

The Net Sales during the year was Rs.5475.52lakhs and your Company could make Net Profit of Rs.111.11 Lakhs after tax.

No. of Employees:

31-03-2017				31-03-2018
PLACE	REGULAR	TRAINEE	TOTAL	PLACE	REGULAR	TRAINEE	TOTAL
HO	24	0	24	HO	22	0	22
UNIT-1	31	0	31	UNIT-1	29	0	29
UNIT-2	74	12	86	UNIT-2	73	10	83

Acknowledgement;

The Board acknowledges the continued assistance from the Bankers, State Governments, Local Bodies, Customers, Suppliers, Executives, Staffs, workers at all levels and the Shareholders for their continuous cooperation and assistance.

For and on Behalf of the Board

Sd/- Sd/-

Place: Bengaluru Sunil L Mundra S Gopalan

Date : May 18th 2018 Managing Director Chairman

Mar 31, 2016

The Directors have pleasure in presenting the twenty third Annual Report together with the Audited Accounts of the company for the year ended 31^st March 2016.

FINANCIAL RESULTS:

The Companyâs financial performance, for the year ended March 31, 2016 is summarized below:

(Rs. In Lakhs)

Particulars	March 31, 2016	March 31, 2015
Gross Sales	6,683.18	7,194.38
Less : Excise duty	477.88	462.30
Net Sales	6,205.31	6,732.08
Other Income	123.23	79.45
Total	6,328.53	6,811.53
Profit before depreciation & taxation	1,024.24	1,155.07
Less : Depreciation	416.77	402.67
Less : Provision for taxation	167.59	236.11
Less: Prior period adjustment (Taxation)	0.29	6.37
Add: Deferred Tax withdrawn	1.85	53.68
Profit after taxation	433.88	564.92
Add: Balance brought forward from previous year	3,593.01	3,247.99
Surplus available for appropriation	4,026.89	3,812.91
Appropriations
General Reserve	21.69	28.25
Proposed Dividend	90.19	78.64
Tax on Dividend	18.36	16.01
Additional depreciation on fixed asset as per Companies Act, 2013	-	97.00
Balance carried to Balance sheet	3,896.65	3,593.01
Total	4,026.89	3,812.91

The company proposes to transfer an amount of Rs. 21.69 lakhs to the General Reserves. An amount of Rs. 3,896.65 lakhs is proposed to be retained in the statement of Profit & Loss account.

OPERATIONAL REVIEWS:

The company had a gross turnover of Rs. 6,683.18 lakhs as against Rs. 7,194.38 lakhs in the previous year, a decline of 7.65%. Profit before depreciation and taxation was Rs. 1,024.24 lakhs against Rs. 1,155.07 lakhs in the previous year. After providing for depreciation and taxation of Rs. 416.77 lakhs & 167.59 lakhs respectively, the net profit of the Company for the year under review was placed at Rs. 433.88 lakhs as against Rs. 564.92 lakhs previous year.

Due to tough market conditions, increase in cost of inputs and reduction in margins, there was decline in profits as compared to the previous year. Accordingly, the profit after tax has reduced by 30.20% during the year under review.

DIVIDEND:

Based on the performance of the Company and the need for conservation of internal accruals, while maintaining the dividend for the shareholders, your Directors are pleased to recommend a final dividend of Rs. 1.50 per equity share at the rate of 15 % subject to the approval of members. The dividend, if approved by the Members, will result in the out flow of Rs.90.19 lakhs from the company in addition to Rs.18.36 lakhs by way of dividend distribution tax. Dividend if declared will be paid to the Members whose names appear in the Register of Members as on the date of the AGM.

SHARE CAPITAL:

During the year under consideration, the paid up capital increased from Rs. 524.27 lakhs to 579.27 lakhs. by conversion of 2,20,000 share warrants into equity (which formed part of earlier preferential issue of equity shares to promoter group in the financial year 2014-15) and issue of additional 3,30,000 equity shares of Rs. 10/- each (at a premium of Rs. 70/- per equity share) by the way of preferential issue to non promoters. The company has also issued 11,00,000 convertible securities / equity share warrants to both promoters and non promoters on preferential basis. The company has obtained Listing approval for the preferential issue of equity shares and equity share warrants / Convertible securities from Bombay Stock Exchange.

FINANCE:

Cash and cash equivalents as at March 31, 2016 was Rs.19.25 lakhs. The company continues to focus on judicious management of its working capital, Receivables, Inventories and other working capital parameters were kept under strict check through continuous monitoring.

FIXED DEPOSITS:

Your company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013. There was an investment of Rs. 507.36 lakhs made by company during the year in part payment for acquiring 40% equity shares of M/S. Supreem Pharmaceuticals (Mysore) Pvt. Ltd for total investment of Rs. 1,171.02 lakhs.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The company has an internal control system, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the internal auditor reports to the chairman of the audit committee and to the Chairman & Managing Director of the Company.

The Audit Committee monitors and evaluates the efficacy and adequacy of internal control system in the company, its compliance with operating systems, accounting procedures and policies at all locations of the company. Based on the report of internal auditor, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

As part of its initiatives under âcorporate social responsibilityâ (CSR), the CSR committee has taken steps to find out such activities to contribute. The CSR committee has calculated the CSR fund amounting to Rs. 29.09 lakhs for the year ending as on March 31, 2016 and the amount will be spent on the CSR activities to be identified shortly. Identification of CSR activities is under process.

CONSERVATION OF ENERGY:

Company ensures that the manufacturing operations are conducted in the manner whereby optimum utilization and maximum possible savings of energy is achieved. The particulars as per Form A are attached to this report.

TECHNOLOGY ABSORPTION:

Company''s products are manufactured by using in-house know how and no outside technology is being used for manufacturing activities. Therefore no technology absorption is involved. The company constantly strives for maintenance and improvement in quality of its products and entire Research & Development activities are directed to achieve the aforesaid goal. The company is having ongoing research and development activity to develop value added products as per details given in Form-B attached to this report.

FOREIGN EXCHANGE EARNINGS AND OUT-GO:

During the period under review, your company has gained Rs. 33.73 lakhs owing to foreign exchange fluctuations. Export revenue constituted 29.77% of Total Revenue as against 31.41% in the previous year.

Foreign Exchange Earnings : Rs. 17,77,80,687/

Foreign Exchange Outgo : Rs. 4,41,21,240/

INDUSTRIAL RELATIONS:

During the year under review, your company enjoyed cordial relationship with workers and employees at all levels.

EXPANSION:

During the year company commissioned a pilot machine to manufacture HPMC capsules at Bangalore plant which has a capacity of about 400 million capsules per annum.

Board of Directors in its 113^th meeting held on 29^th October, 2015, had approved a scheme of conversion of three existing gelatin capsules lines to HPMC manufacturing lines at a total cost of Rs. 24 Crores to be completed in 30 months. Work on this proposal is likely to start at the end of this current financial year.

DIRECTORS:

Mr. Laxminarayan Moondra and Mrs. Jyoti Mundra, Directors retire by rotation and being eligible, offer themselves for re appointment. All independent directors have given declarations that they meet the criteria of independence as laid down under section 149 (6) of the Companies Act, 2013 and Regulation 25(3) of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015.

Board Evaluation

- Board dynamics and relationships

- Information flows

- Decision-making

- Relationship with stakeholders

- Company performance and strategy

- Tracking Board and committeeâs effectiveness

- Peer evaluation

The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The evaluation process has been explained in the corporate governance report. The Board approved the evaluation results as collated by the nomination and remuneration committee.

Independent Directors meeting:

Independent directors held a separate meeting on 27^th January, 2016. They have evaluated the performance of executive directors and conducted thorough business review affecting the performance of the company as per the requirements of statues.

Listing Agreement

The Securities and Exchange Board of India (SEBI), on September 2, 2015, issued SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the aim to consolidate and streamline the provisions of the Listing Agreement for different segments of capital markets to ensure better enforceability. The said regulations were effective from December 1, 2015. Accordingly, all listed entities were required to enter into the Listing Agreement within six months from the effective date. The company entered into Listing Agreement with BSE Limited during January, 2016.

Policies

We seek to promote and follow the highest level of ethical standards in all our business transactions guided by our value system. The SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandated the formulation of certain policies for all listed companies. All our corporate governance policies are available on our website (http://www.naturalcapsules.com/pages/policies.html). The policies are reviewed periodically by the Board and updated based on need and new compliance requirement.

Name of the policy	Brief description	Web link
Whistle blower Policy (Policy on vigil Mechanism)	The company has adopted the whistle blower mechanism for directors and employees to report concerns about unethical behaviour, actual or suspected fraud, or violation of the Companyâs code of conduct and ethics. There has been no change to the Whistle blower Policy adopted by the Company during fiscal 2016. No employee has been denied access to the audit committee.	http://www.naturalcapsules.com/ pdf/vigil-mechanism-and-whistle- blowers-policy.pdf
Nomination and Remuneration policy	This policy formulates the criteria for determining qualifications, competencies, positive attributes and independence for the appointment of a director (executive/non-executive) and also the criteria for determining the remuneration of the directors, key managerial personnel and other employees	http://www.naturalcapsules.com/ pdf/nomination-and-remuneration- policy.pdf
Corporate Social Responsibility Policy	The policy outline the Companyâs strategy to bring about a positive impact on society through programs relating to hunger, poverty, education, healthcare, environment and lowering its resource footprint.	http://www.naturalcapsules.com/ pdf/corporate-social-responsibility- policy.pdf
Determination of materiality for disclosures Policy	The information covered by this Policy shall include âinformation related to the Companyâs business, operations or performance which has a significant effect on securities investment decisionsâ that the company is required to disclose in a timely and appropriate manner by applying the guidelines for assessing materiality.	http://www.naturalcapsules.com/ pdf/Determination-of-Materiality-for- Disclosures.pdf
Related Party Transaction Policy	The Policy regulates all transactions between the Company and its related parties.	http://www.naturalcapsules.com/ pdf/policy-on-related-party- transactions.pdf
Insider Trading Policy	The policy provides the framework in dealing with securities of the Company	http://www.naturalcapsules.com/ pdf/Code-of-Conduct-Insider- Trading.pdf
Document Retention and Archival Policy	The policy deals with the retention and archival of corporate records of Natural capsules limited.	http://www.naturalcapsules.com/ pdf/Document-Retention-and- Archival-Policy.pdf

Meetings

During the year Seven Board Meetings and Four audit committee meetings were convened and held. The details of which are given in the corporate governance report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

DIRECTORâS RESPONSIBILITY STATEMENT:

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

i) In the preparation of the annual accounts, the applicable accounting standards have been followed.

ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the company for the year under review.

iii) The directors have 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 have 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 that such internal financial controls are operating effectively.

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

RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financial year were on armâs length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with promoters, key managerial personnel or other designated persons which may have potential conflict with interest of the company at large.

A) Name of the related party and nature of relationship where control exists:

Name of Related Party Nature of Relationship

M/s Mundra Enterprises Entity in which Director or KMP is Related

M/s. Balurghat Technologies Ltd Entity in which Director or KMP is Related

M/s.Minakshi Enamels Entity in which Director or KMP is Related

Mr. Sunil L Mundra Key Management Personnel

Mr. Laxminarayan Moondra Key Management Personnel

Mr. Satyanarayan Mundra Key Management Personnel

(B)(i) Related Party Transactions:

Name of Related Party

Nature of Transactions

Amount of Transactions

Current Year\ (Previous Year)

Amount Outstanding at the end of year

Credit (Rs.) Current Year\ (Previous Year)

Debit (Rs.) Current Year\ (Previous Year)

M/s Mundra Enterprises

Mr. Sunil L Mundra

Mr. Laxminarayan Moondra

Mr. Satyanarayan Mundra

M\s Minakshi Enamels

M/s. Balurghat Technology Ltd

Operating Lease Rental Payments

Managerial Remuneration

Purchase of Copper Rivets

Travelling Agency

5,76,000

(5,40,000)

40.50.000

(37.60.000)

27.45.000

(19.50.000)

27.90.000

(26.10.000) 19,085

(36,481)

2,36,557

(5,25,920)

43,200

2,32,144

(4,64,704)

1,67,308

1,65,730

There were no material significant related party transactions having potential conflict with the interest of company. The disclosures relating to holding vs. Subsidiary companies are not relevant.

SUBSIDIARY COMPANIES:

The company does not have any subsidiary.

CODE OF CONDUCT:

The Board of Directors has approved a code of conduct which is applicable to the members of the Board/committees and all employees in the course of day to day business operations of the company. The company believes in âZero Toleranceâ against bribery, corruption and unethical dealings / behaviours of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as âcode of business conductâ which forms an appendix to the code. The code has been posted on the company''s website www.naturalcapsules.com.

The code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The code gives guidance through examples on the expected behaviour from an employee in a given situation and the reporting structure.

All the Board members and the senior management personnel have confirmed compliance with the code. All management staff was given appropriate training in this regard.

PREVENTION OF INSIDER TRADING:

The Board of Directors has adopted the Insider Trading Policy in accordance with the requirements of the SEBI (Prohibition of Insider Trading) Regulation, 2015. The Insider Trading Policy of the Company lays down guidelines and procedures to be followed and disclosures to be made while dealing with shares of the Company, as well as the consequences of violation. The policy has been formulated to regulate, monitor, and ensure reporting of deals by employees and to maintain the highest ethical standards of dealing in Company securities. The Insider Trading Policy of the Company covering code of practices and procedures for fair disclosure of unpublished price sensitive information and code of conduct for the prevention of insider trading is available on our website http:// www.naturalcapsules.com/pdf/Code-of-Conduct-Insider-Trading.pdf

All Directors and the designated employees have confirmed compliance with the Code.

AUDITORâS REPORT / SECRETARIAL AUDIT REPORT:

The observation made in the Auditors'' Report read together with relevant notes thereon are self explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013.

As required under section 204 (1) of the Companies Act, 2013 the Company has obtained a secretarial audit report. Certain observations made in the report with regard to non filing of some forms were mainly due to ambiguity and uncertainty of the applicability of the same for the relevant period. However, the company would ensure in future that all the provisions are complied with the fullest extent.

AUDITORS:

The Auditors M/S. Gnanoba & Bhat, Chartered Accountants, Bangalore, continues to be eligible as company''s statutory auditors and it is proposed to ratify their appointment for the financial year 2016-17 on the same remuneration in this AGM.

SECRETARIAL AUDIT:

Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the company has appointed Mr. R.Parthasarathi, company Secretary in practice to undertake the Secretarial Audit of the Company for the financial year 2016-17 in the board meeting held on 27^th May, 2016. The Secretarial Audit report for the financial year 2015-16 is annexed herewith as âAnnexure Bâ

Regarding auditors remarks relating to not spending CSR expenditure, the management is still in the process of identifying the areas for expenditure and the same is likely to be spent in the current year.

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as âAnnexure Câ.

BUSINESS RISK MANAGEMENT:

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Regulation 17(9) (b) of SEBI (LODR) Regulations, 2015, the company has constituted a business risk management committee. The details of the committee and its terms of reference are set out in the corporate governance report forming part of the Boards report.

At present the company has not identified any element of risk which may threaten the existence of the company.

PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors and KMP are given in CORPORTE GOVERNANCE REPORT, which form an integral part of this Report, are set out as separate Annexure.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS

The Corporate Governance and Management Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexure, together with the Certificate from the auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated in Scheduled V(E) of the SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015.

There were no material changes and commitments affecting the financial position of the company from the end of financial year 20152016 up to the date of this report.

ACKNOWLEDGEMENTS:

Your Company and its Directors wish to extend their sincerest thanks to the Members of the Company, Bankers, State Government, Local Bodies, Customers, Suppliers, Executives, Staff and workers at all levels for their continuous cooperation and assistance.

For and on behalf of the Board of Directors

Bangalore Sunil L Mundra Satyanarayan Mundra

July 30, 2016 Managing Director Whole Time Director

Mar 31, 2015

DEAR MEMBERS,

The Directors have pleasure in presenting their twenty second Annual Report together with the Audited Accounts of the company for the year ended 31st March 2015.

FINANCIAL RESULTS:

The Company's financial performance, for the year ended March 31,2015 is summarized below:

(Rs. In Lacs)

Particulars March31,2015 March31,2014

Gross Sales 7194.38 6239.95

Less : Excise duty 462.30 386.97

Net Sales 6732.08 5852.98

Other lncome 79.45 89.14

Total 6811.53 5942.12

Profit before depreciation & 1156.39 1104.02 taxation

Less:Depreciation 402.67 361.36

Less:Provisionfortaxation 236.11 170.93

Less: Prior period adjustment (Taxation) 6.37 nil

Add:Deferred Tax withdrawn 53.68 (115.53)

Profit aftertaxation 564.92 456.19

Add: Balance brought forward from

previous year 3247.99 2902.17

Surplus available for appropriation 3812.91 3358.36

Appropriations

General Reserve 28.25 22.81

Proposed Dividend 78.64 75.34

Tax inDividend 16.01 12.22

Additional depreciation on fixed asset

asper Companies Act,2013 97.00 nil

Balance carried to Balance sheet 3593.01 3247.99

Total 3812.91 3358.36

The company proposes to transfer an amount of Rs. 28.25 lacs to the General Reserves. An amount of Rs. 3593.01 lacs is proposed to be retained in the statement of Profit & Loss account.

OPERATIONAL REVIEWS:

Gross revenues increased to Rs. 7194.38 lacs, a growth of around 15.30% against Rs. 6239.95 lacs in the previous year. Profit before depreciation and taxation was Rs. 1156.39 lacs against Rs. 1104.02 lacs in the previous year. After providing for depreciation and taxation of Rs. 402.67 lacs & 236.11 lacs respectively, the net profit of the Company for the year under review was placed at Rs. 564.92 lakhs as against Rs. 456.19 lacs previous year.

Due to tough market conditions, increase in cost of inputs and reduction in margins, the percentage increase in profit has not been proportionate to the increase in turnover. However, the profit after tax has increased by 23.83% during the year under review.

DIVIDEND:

Based on the performance of the Company and the need for conservation of internal accruals, your Directors are pleased to recommend a final dividend of Rs.1.5 per equity share at the rate of 15% subject to the approval of members. The dividend, if approved by the Members, will result in the out flow of Rs. 78.64 lacs from the company in addition to Rs. 16.01 lacs by way of dividend distribution tax. Dividend if declared will be paid to the Members whose names appear in the Register of Members as on the date of the AGM.

SHARE CAPITAL:

During the year under consideration, the paid up capital increased from Rs. 502.27 lacs to 524.27 lacs, by conversion of share warrants into equity (which formed part of earlier preferential issue of equity shares to promoter group in the financial year 2013- 14). The additional equity was issued at a premium of Rs. 26/- per equity share. In principle approval for additional issue of equity shares was obtained from Bombay Stock Exchange. The company has made application for filing listing and the approval for the same is awaited from Bombay Stock Exchange.

FINANCE:

Cash and cash equivalents as at March 31,2015 was Rs. 16.56 lacs. The company continues to focus on judicious management of its working capital, Receivables, Inventories and other working capital parameters were kept under strict check through continuous monitoring.

FIXED DEPOSITS:

Your company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

The company has not given any loans orguarantees covered under the provisions of section 186 of the Companies Act, 2013. There were no investments made by company during the year under consideration.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The company has an internal control system, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the internal auditor reports to the chairman of the audit committee and to the Chairman & Managing Director of the Company.

The Audit Committee monitors and evaluates the efficacy and adequacy of internal control system in the company, its compliance with operating systems, accounting procedures and policies at all locations of the company. Based on the report of internal auditor, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee ofthe Board.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES:

As part of its initiatives under "corporate social responsibility" (CSR), the CSR committee has taken steps to find out such activities to contribute. The CSR committee has calculated the CSR fund amounting to Rs. 28.41 lacs for the year ending as on March 31,2015 and the amount will be spent on the CSR activities to be identified shortly. Identification of CSR activities is under process.

CONSERVATION OF ENERGY:

Company ensures that the manufacturing operations are conducted in the manner whereby optimum utilization and maximum possible savings of energy is achieved. The particulars as per Form A are attached to this report.

TECHNOLOGY ABSORPTION:

Company's products are manufactured by using in-house know how and no outside technology is being used for manufacturing activities. Therefore no technology absorption is involved. The company constantly strives for maintenance and improvement in quality of its products and entire Research & Development activities are directed to achieve the aforesaid goal. The company is having ongoing research and development activity to develop value added products as per details given in Form-B attached to this report.

FOREIGN EXCHANGE EARNINGS AND OUT-GO:

During the period under review, your company has gained Rs. 21.59 lacs owing to foreign exchange fluctuations. Export revenue constituted 31.41 % of Total Revenue as against 26.75% in the previous year.

Foreign Exchange Earnings : Rs. 21,39,58,939/- Foreign Exchange Outgo : Rs. 2,44,45,628/-

INDUSTRIAL RELATIONS:

During the year under review, your company enjoyed cordial relationship with workers and employees at all levels.

EXPANSION:

During the year company commissioned the last machine after modification at Pondicherry plant. With the commissioning of this machine the installed capacity of both units put together has increased to 7.8 Billion capsules per annum.

Further company started work for installation of an additional modified capsule line along with other required utilities at Bangalore unit for manufacture of HPMC capsules, and the same is likely to get commissioned during first quarter of next year.

DIRECTORS:

Mr. Sushil Kumar Mundra and Mr. Sathyanarayan Mundra, Directors retire by rotation and being eligible, offer themselves for re appointment.

Mrs.Jyoti Mundra (relative of Promoter Directors) was appointed as an Additional Director (Woman Director) in consonance with the requirements of Sec.149 of companies Act, 2013 and clause 49 of Listing Agreement. Accordingly, she vacates office at this AGM. Being eligible, a notice has been received from a member proposing her appointment as a regular non executive Director. It is proposed to appoint heras a Director.

All independent directors have given declarations that they meet the criteria of independence as laid down under section 149 (6) of the Companies Act, 2013 and clause 49 of the Listing agreement.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the listing agreement, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Appointment & Remuneration Committees. The manner in which the evaluation has been carried out has been explained in the corporate governance report.

Remuneration Policy

The Board has, on the recommendation of the Appointment & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The remuneration policy is stated in the corporate governance report and has been posted in company's website www.naturalcapsules.com

Meetings

During the year seven Board Meetings and four audit committee meetings were convened and held. The details of which are given in the corporate governance report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013.

DIRECTOR'S RESPONSIBILITY STATEMENT:

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

i) In the preparation of the annual accounts, the applicable accounting standards have been followed.

ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the company for the year under review.

iii) The directors have 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 have 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 that such internal financial controls are operating effectively.

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

RELATED PARTY TRANSACTIONS:

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with promoters, key managerial personnel or other designated persons which may have potential conflict with interest of the company at large.

SUBSIDIARY COMPANIES:

The company does not have any subsidiary.

CODE OF CONDUCT:

The Board of Directors has approved a code of conduct which is applicable to the members of the Board/committees and all employees in the course of day to day business operations ofthe company. The company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behaviours of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "code of business conduct" which forms an appendix to the code. The code has been posted on the company's website www.naturalcapsules.com.

The code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The code gives guidance through examples on the expected behaviour from an employee in a given situation and the reporting structure.

All the Board members and the senior management personnel have confirmed compliance with the code. All management staff was given appropriate training in this regard.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The company has a vigil mechanism policy to deal with instances offraud and mismanagement, ifany. In staying true to our values of strength, performance and passion and in line with our vision of being one of the respected companies in India, the company is committed to the high standards of corporate governance and stakeholder responsibility.

The company has a fraud risk management policy to deal with instances offraud and mismanagement, ifany. The policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.

High level committee has been constituted which looks into the complaints raised. The committee reports to the audit committee and the Board.

PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees, while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code.

All Board of Directors and the designated employees have confirmed compliance with the Code.

AUDITOR'S REPORT/ SECRETARIAL AUDIT REPORT:

The observation made in the Auditors' Report read together with relevant notes thereon are self explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013.

As required under section 204 (1) of the Companies Act, 2013 the Company has obtained a secretarial audit report. Certain observations made in the report with regard to non filing of some forms were mainly due to ambiguity and uncertainty of the applicability of the same for the relevant period. However, the company would ensure in future that all the provisions are complied with the fullest extent.

AUDITORS:

The Auditors M/S. Gnanoba & Bhat, Chartered Accountants, Bangalore, continues to be eligible as company's statutory auditors and it is proposed to ratify their appointment for the financial year 2015-16 on the same remuneration in this AGM.

SECRETARIAL AUDIT:

Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the company has appointed Mr. R.Parthasarathi, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as "Annexure B"

EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Return in form MGT-9 is annexed herewith as "Annexure C".

BUSINESS RISK MANAGEMENT:

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49 of the listing agreement, the company has constituted a business risk management committee. The details of the committee and its terms of reference are set out in the corporate governance report forming part of the Boards report.

At present the company has not identified any element of risk which may threaten the existence of the company. PARTICULARS OF EMPLOYEES:

The information required pursuant to Section 197 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors and KMP are given in CORPORATE GOVERNANCE REPORT BELOW, which form an integral part of this Report, are set out as separate Annexure.

CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS

The Corporate Governance and Management Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexure, together with the Certificate from the auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated in Clause 49 of the Listing Agreement.

ACKNOWLEDGEMENTS:

Your Company and its Directors wish to extend their sincerest thanks to the Members of the Company, Bankers, State Government, Local Bodies, Customers, Suppliers, Executives, Staff and workers at all levels for their continuous cooperation and assistance.

For and on behalf of the Board of Directors

Bangalore Sunil L Mundra Satyanarayan Mundra May30,2015 Managing Director Whole Time Director

Mar 31, 2014

Dear Members,

The directors hereby present the twentieth Annual Report together with the Audited Accounts of the company for the year ended 31st March 2014.

1. FINANCIAL RESULTS:

The Comparative financial results for the period are as under: 2013-14 2012-13 (Rs. In lacs) (Rs. In lacs)

Sales & other income 5,942.12 5,418.89

PBDI 1,196.57 1,163.97

Depreciation & Preliminary exp 361.36 311.13

Interest 92.26 123.43

Profit/(Loss) before tax 742.65 729.41

Provision for taxation 170.92 190.05

Deferred tax 115.53 (20.99)

Prior period taxes 0.0 (72.75)

Profit/(Loss) after tax 456.19 633.11

Amount transferred to reserves 22.81 31.66

2. PERFORMANCE & PROSPECTS:

During the year under review, the company''s turnover was Rs. 5942.12 lacs and the company has earned a Net profit (before tax) of Rs 742.65 lacs as against the corresponding net profit of Rs 729.42 lacs in the previous year. An amount of Rs.440.55 lacs was ploughed back from profits for funding the ongoing expansion at Pondicherry. The exports of the company has increased by 10.96% due to continuous efforts being made by sales team. Even though the overall sales turnover has increased by 9.46%, the profit before tax has increased by 1.82% only, due to higher input costs.

3. FLUCTUATION IN FOREIGN EXCHANGE:

The Company has benefited to an extent of Rs 43.24 lacs owing to foreign exchange fluctuation.

4. PERFORMANCE CREDIT RATING:

Your Directors are pleased to inform you that the Company has obtained "ICRA" rating of "A3 " indicating short term and long term financial stability. This has helped in reduction in interest rate charged by the Company''s bankers.

5. Dividend:

While considering the need for conservation of resources for ongoing expansion, your Directors are pleased to recommend a dividend of Rs 1.50 per equity share of Rs 10/- each for the year ended 31-3-2014 for the members whose names appear in the register of members as on the date of AGM viz. 27.08.2014.

6. CAPITAL:

During the year under review, the authorized capital increased, from Rs 5 crs to Rs 6 crs and paid up has increased from Rs 450.27 lakhs to Rs 502.27 Lakhs. The additional equity was issued at a premium of Rs 135.2 lakhs. In principle approval for additional issue of equity shares was obtained. The company has made application for filing listing and the approval for the same is awaited from Bombay Stock Exchange.

7. EXPANSION:

During the year under consideration the company has commissioned all but one of the imported machines after modification. With the commissioning of all these machines the installed capacity of the company has increased to 7.35 billion capsules per annum. Recently Company has also procured one more generator and imported Auto Capsule Inspecting machines to monitor the quality of products.

8. DIRECTORS:

Mr V. Subramony has resigned as a Director effective from 15/05/2013 due to his ill health and Mr V. Balaji Bhat, has resigned on 02-09-2013 citing personal reasons. The Board wishes to place on record their valuable contribution to the company in their capacity as Directors. Mr Laxminarayana Mundra ceased as Whole-time Director on 31-05-2014 on attaining the age of 70 years. However, considering his business experience and major contribution as Promoter Director and Whole time Director towards progress of the Company, and the need to his continuous contribution for sustaining and furthering the growth prospects of the Company, it is proposed to reappoint him as a Whole-time Director of the Company for a period of three years w.e.f 01-09-2014. He is otherwise eligible for re-appointment.

Mr S Gopalan, Mr C P Rangachar and Dr C M Gurumurthy were functioning as Independent Directors. Considering their educational, business back ground and immense contribution towards progress of the Company, as required by new Companies Act 2013 and being eligible, it is proposed to appoint them as Independent Directors for a period of 5 years as recommended by Nomination and Remuneration Committee.

In view of the tenure of Managing Director, Mr Sunil L Mundra and Mr.Satyanarayan Mundra, Whole-Time Director, and considering their business background and immense contribution towards the progress of the Company the Board of Directors have re-appointed them for a further period of five years w.e.f 01.06.2014 subject to the approval of Members. They are otherwise eligible for re-appointment.

9. DISCLOSURE OF PARTICULARS AS PER BOARD''S REPORT RULES 1988:

A. CONSERVATION OF ENERGY:

The particular as per Form A is attached to this report.

B RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION:

Company is having an ongoing research and development activity to develop value added products as per details given in Form-B attached to this report.

C. FOREIGN EXCHANGE, EARNINGS & OUTGO DURING THE YEAR:

Foreign exchange earning: Rs. 1537.40 Lacs

Foreign exchange outgo : 30.43 Lacs

D. EXPORTS;

During the year the export turnover was Rs 1,590 lakhs as against Rs 1,432 lakhs in previous year. Company hopes to improve upon the last year''s performance.

10. DIRECTOR''S RESPONSIBILITY STATEMENT:

A) In the preparation of the annual accounts, the applicable accounting Standards have been followed.

B) The directors have selected such accounting policies and applied them consistently and made judgements 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 of the company for the period.

C) The directors have taken proper and sufficient care for 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 the fraud and other irregularities.

D) The directors have prepared the annual accounts on a going concern basis.

11. AUDITORS:

M/S. Gnanoba & Bhat, Chartered Accountants, Bangalore retire at the ensuing Annual General Meeting. Being eligible for re- appointment, it is proposed to re-appoint them for a period of 3 years as per the provisions of new Companies Act 2013.

12. REPORT ON CORPORATE GOVERNANCE

A separate report on Corporate Governance is given in the Annexure A & B.

13. Clause 49 of the Listing Agreement:

a. During the year under report the trading of the company''s securities has not been suspended by the Stock Exchanges with which the shares are listed.

b. The names and addresses of the Stock Exchanges with which the company''s Securities are listed are as follows:

i) Bangalore Stock Exchange Ltd, 51, Stock Exchange Towers, 1st Cross, J C Road, Bangalore 560 027

ii) The Stock Exchange Mumbai, PJ Towers, Dalai street, Mumbai-400 001

c. The annual listing fees of the above Stock Exchanges have been paid.

14. FIXED DEPOSITS:

During the year under consideration, your Company has not accepted any deposits from the Public as per the provisions of the Companies Act 2013.

15. PARTICULARS OF EMPLOYEES:

There is no employee drawing a remuneration of Rs.5 Lakhs and above per month or Rs.60 lakhs per annum, as per the provisions of the Companies Act.

13. ACKNOWLEDGEMENTS:

The Management wishes to place on record its sincere thanks and appreciation to State Bank of India, Specialised Commercial Branch, Bangalore-1, for their continued financial support and guidance, and its appreciation for the excellent co-operation extended by the staff & workers of the company. Management also wishes to place on record its appreciation for the valuable support extended by various Government agencies at Bangalore and Pondicherry.

For & on behalf of the Board

Place: Bangalore Date: 28th May, 2014 S.GOPALAN CHAIRMAN

Mar 31, 2013

TO THE MEMBERS

The directors hereby present the twentieth Annual Report together with the Audited Accounts of the company for the year ended 31s''March 2013.

1. FINANCIAL RESULTS:

The Comparative financial results for the period are as under:

2012-13 2011-12 (Rs. In lacs) (Rs. In lacs)

Sales & other income 5,418.89 4,459.17

PBDI 1,163.97 1,177.29

Depreciation & Preliminary exp 311.13 270.30

Interest 123.43 134.73

Profit/(Loss) before tax 729.41 772.26

Provision for taxation 190.05 232.55

Deferred tax (20.99) 10.53

Prior period taxes (72.75) 22.29

Profit/(Loss) after tax 633.11 506.87

Amount transferred to reserves 31.66 25.34

2. PERFORMANCE & PROSPECTS:

During the year under review, the company''s turnover increased by 22.22% and the company has earned a Net profit (before tax) of Rs 729.41 lacs as against the corresponding net profit of Rs 772.26 lacs in the previous year. An amount of Rs.554.62 lacs was ploughed back from profits for funding the ongoing expansion at Pondicherry. The export turnover of the company has increased significantly due to continuous efforts being made by sales team. At the same time even though the overall sales turnover has increased by 22.22%, the profit before tax has decreased by 5.54%, mainly due to increase in all input costs.

3. FLUCTUATION IN FOREIGN EXCHANGE: The

Company has benefitted to an extent of Rs 23.16 lacs owing to foreign exchange fluctuation.

4. PERFORMANCE CREDIT RATING:

Your Directors are pleased to inform you that the Company has obtained "ICRA" rating of "A3 " indicating short term and long term financial stability. This has helped in reduction in interest rate charged by the Company''s bankers.

5. Dividend:

While considering the need for conservation of resources for ongoing expansion, your Directors are pleased to recommend a dividend of Rs 1.50 per equity share of Rs 10/- each for the year ended 31 -3- 2013 for the members whose names appear in the register of members as on the date of AGM viz., 25.7.2013.

6. EXPANSION:

During the year under consideration the company has commissioned one of the imported machines after modification. Company is yet to commission 2 machines out of 9 machines imported earlier. With the commissioning of all these machines the installed capacity of the company will increase to 7.35 billion capsules per annum.

7. DIRECTORS:

Mr V. Subramony has resigned as a Director effective from 15/05/2013 due to his ill health and the Board wishes to place on record his invaluable contribution to the company in his capacity as Director. Dr C M Gurumurthy and Mr Sushilkumar Mundra, Directors,retire at this Annual General Meeting and being eligible, offer themselves for re-appointment.

8. DISCLOSURE OF PARTICULARS AS PER BOARD''S REPORT RULES 1988:

A. CONSERVATION OF ENERGY:

The particular as per Form Ais attached to this report.

B. RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION:

Company is having an ongoing research and development activity to develop value added products as per details given in Form-B attached to this report.

C. FOREIGN EXCHANGE, EARNINGS & OUTGO DURING THE YEAR:

Foreign exchange earning: Rs.1,211.53Lacs Foreign exchange outgo : Rs. 51.43 Lacs

9. DIRECTOR''S RESPONSIBILITY STATEMENT:

A) In the preparation of the annual accounts, the applicable accounting Standards have been followed.

B) The directors have selected such accounting policies and applied them consistently and made judgements 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 of the company for the period.

C) The directors have taken proper and sufficient care for 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 the fraud and other irregularities.

D) The directors have prepared the annual accounts on a going concern basis.

9. AUDITORS:

M/S. Gnanoba & Bhat, Chartered Accountants, Bangalore retire at the ensuing Annual General Meeting. Being eligible for re-appointment, it is proposed to re-appoint them.

10. REPORT ON CORPORATE GOVERNANCE:

A separate report on Corporate Governance is given in theAnnexure A&B.

11. Clause 49 of the Listing Agreement:

a. During the year under report the trading of the company''s securities has not been suspended by the Stock Exchanges with which the shares are listed.

b. The names and addresses of the Stock Exchanges with which the company''s Securities are listed are as follows:

i) Bangalore Stock Exchange Ltd, 51, Stock Exchange Towers, 1st cross, JC Road, Bangalore 560027.

ii) The Stock Exchange Mumbai, PJ Towers, Dalai Street, Mumbai-400001.

c. Coimbatore Stock Exchange Ltd. with whom company''s Securities were listed earlier, has informed the Company that they have ceased to exist from4thApril2013.

d. The annual listing fees of the above Stock Exchanges have been paid.

12. ACKNOWLEDGEMENTS:

The Management wishes to place on record its sincere thanks and appreciation to State Bank of India, Specialised Commercial Branch, Bangalore-1, for their continued financial support and guidance, and its appreciation for the excellent co-operation extended by the staff & workers of the company. Management also wishes to place on record its appreciation for the valuable support extended by various Government agencies at Bangalore and Pondicherry.

For & on behalf of the Board

S.GOPALAN CHAIRMAN

Place: Bangalore *

Date: 25th May, 2013

Mar 31, 2012

The directors are pleased to present the Nineteenth Annual Report together with the Audited Accounts of the company for the year ended 31stMarch 2012.

1. FINANCIAL RESULTS:

The Comparative financial results for the period are as under:

2011-12 2010-11 (Rs. In lacs) (Rs. In lacs)

Sales & other income 4,459.17 3,453.96

Profit before Depreciation and interest 1,177.29 931.87

Depreciations Preliminary exp 270.30 187.33

Interest 134.73 80.76

Profit/(Loss) before tax 772.26 663.79

Provision for taxation 232.55 174.51

Deferred tax 10.53 40.92

Prior period expenses 22.29 1.60

Profit/(Loss) after tax 506.87 446.76

Amount transferred to reserves 25.34 11.17

2. PERFORMANCE & PROSPECTS :

During the year under review, the company's turnover increased by 29% and the company has earned a Net profit (before tax) of Rs. 772 lacs as against the corresponding net profit of Rs. 664 lacs in the previous year. An amount of Rs. 539 lacs was ploughed back from profits for funding the ongoing expansion at Pondicherry. The exports of the company has remained almost at same level due to difficult situations on international front. Though the sales turnover has increased by 29%, the profit after tax has increased by only 16% mainly due to increase in raw material costs, depreciation, interest, fuel and power costs etc.

3. FLUCTUATION IN FOREIGN EXCHANGE.

The Company has benefited to an extent of Rs. 28 lacs owing to foreign exchange fluctuation.

4. PERFORMANCE CREDIT RATING:

Your Directors are pleased to inform you that the Company has obtained "CRISIL" rating of "SME-1" indicating HIGHEST PERFORMANCE CAPACITY AND HIGH FINANCIAL STRENGTH for fourth successive year.

5. DIVIDEND:

While considering the need for conservation of resources for ongoing expansion, your Directors are pleased to recommend a dividend of Rs. 1.50 per equity share of Rs 10/- each for the year ended 31-3-2012, to the members whose names appear in the register of members as on the date of AGM viz., 26-7-2012.

6. EXPANSION:

During the year under consideration, the company has improvised / modified one of the imported machines and installed it as Pilot plant. Company is yet to commission 3 machines out of 9 machines imported ealrier. With the commissioning of all these machines the installed capacity of the company will increase to 7.35 billion capsules per annum.

7. DIRECTORS:

Mr. S. Gopalan and Mr. V. Balaji Bhat, Directors retire at this Annual General Meeting and being eligible, offer themselves for re-appointment.

8. DISCLOSURE OF PARTICULARS AS PER BOARD'8 REPORT RULES1988:

A. CONSERVATION OF ENERGY:

The particulars as per form 'A' is attached to this report.

B. RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION:

Company is having an ongoing research and development activity to develop value added products as per details given in Form-B attached to this report.

9. DIRECTOR'S RESPONSIBILITY STATEMENT:

A) In the preparation of the annual accounts, the applicable accounting Standards have been followed.

B) The directors have selected such accounting policies and applied them consistently and made judgements 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 of the company for the period.

C) The directors have taken proper and sufficient care for 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 the fraud and other irregularities.

D) The directors have prepared the annual accounts on a going concern basis.

10. AUDITORS:

M/S. Gnanoba & Bhat, Chartered Accountants, Bangalore retire at the ensuing Annual General Meeting. It is proposed to re-appoint them.

11. REPORT ON CORPORATE GOVERNANCE:

A separate report on Corporate Governance is given in the Annexure A&B.

12. Clause 49 of the Listing Agreement:

a. During the year under report the trading of the company's securities has not been suspended by the Stock Exchanges with which the shares are listed.

b. The names and addresses of the Stock Exchanges with which the company's Securities are listed are as follows:

i) Bangalore Stock Exchange Ltd, 51, Stock

Exchange Towers, 1st cross, JC Road, Bangalore 560027

ii) The Stock Exchange Mumbai, PJ Towers, Dalai street, Mumbai-400 001

iii) Coimbatore Stock Exchange Ltd, Stock exchange building, CSX Towers, 683-686,Trichy road, Singanallur, Coimbatore-641 005.

c. The annual listing fees of the above Stock Exchanges have been paid.

13. AUDITOR'S REMARKS:

(a) Reg. Para 9(b), (c) of Annexure to Auditors Report,

relating to disputed excise and income tax liabilities, the management is of the view that the Company is likely to win the appeal. (b) Reg. Para 9 (d) of the report, the managements of the view that the liability on account of above said statutory dues are insignificant.

14. ACKNOWLEDGEMENTS:

The Management wishes to place on record its sincere thanks and appreciation to State Bank of India, Specialised Commercial Branch, Bangalore-1, for their financial support and guidance, and its appreciation for the excellent co-operation extended by the staff & workers of the company. Management also wishes to place on record its appreciation for the valuable support extended by various Government agencies at Bangalore and Pondicherry.

For & on behalf of the Board

S.GOPALAN

CHAIRMAN

Place: Bangalore

Date : 26th May, 2012

Mar 31, 2011

TO THE MEMBERS:

The directors hereby present the Eighteenth Annual Report together with the Audited Accounts of the company for the year ended 31" March 2011.

1. FINANCIAL RESULTS:

The Comparative financial results for the period are as under:

2010-11 2009-10 (Rs. In lacs) (Rs. In lacs)

Sales & other income 3,453.96 2,948.98 Profit before Depreciation

and interest 931.87 817.41

Depreciation & Preliminary exp 187.33 145.87

Interest 80.76 30.53

Profit/(Loss) before tax 663.79 641.00

Provision for taxation 174.51 205.72

Deferred tax 40.92 8.71

Prior period expenses 1.60 -

Profit/(Loss) after tax 446.76 426.56

Amount transferred to reserves 11.17 10.66

2. PERFORMANCE & PROSPECTS :

During the year under review, the company's turnover increased by 17% and the company has earned a Net profit (before tax) of Rs 663.79lacs as against the corresponding net profit of Rs 641 .00 lacs in the previous year. An amount of Rs.665 lacs was ploughed back from profits for funding the ongoing expansion at Pondicherry. The exports of the company has increased by 21 % during the year under consideration. Though the sales turnover has increased by 17%, there was slight dip in profit as compared to previous year, mainly due to increase in depreciation and interest on account of commissioning of New machines and credit facilities.

3. PERFORMANCE CREDIT RATING:

Your Directors are pleased to inform you that the Company has obtained "CRISIL" rating of "SME-1" indicating HIGHEST PERFORMANCE CAPACITY AND HIGH FINANCIAL STRENGTH for third successive year

4. DIVIDEND:

While considering the need for conservation of resources for ongoing expansion, your Directors are pleased to recommend a dividend of Rs 1.20 per equity share of Rs 10/- each for the year ended 31-3-2011 the members whose names appear in the register of members as on the date of AGM viz., 27-7-2011.

5. EXPANSION:

During the year under consideration, the company has installed four imported machinery at Pondicherry. 5 out of 9 machines have been commissioned and balance 4 are at various stages of commissioning. With the commissioning of all these machines the installed capacity of the company will increase to 7.35 billion capsules per annum.

6. DIRECTORS:

Mr C P Rangachar and Dr C M Gurumurthy, Directors retire at this Annual General Meeting and being eligible, offer themselves for re-appointment.

7. DISCLOSURE OF PARTICULARS AS PER BOARD'S REPORT RULES1988:

A. CONSERVATION OF ENERGY: The particular as per form A is attached to this report.

B. RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION:

Company is having an ongoing research and development activity to develop value added products.

C. FOREIGN EXCHANGE, EARNINGS & OUTGO:

Foreign exchange earning : Rs. 563.65 lacs Foreign exchange outgo Rs. 16.95 "

8. DIRECTOR'S RESPONSIBILITY STATEMENT:

A) In the preparation of the annual accounts, the applicable accounting Standards have been followed.

B) The directors have selected such accounting policies and applied them consistently and made judgements 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 of the company for the period.

C) The directors have taken proper and sufficient care for 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 the fraud and other irregularities.

D) The directors have prepared the annual accounts on a going concern basis.

9. AUDITORS:

M/S. Gnanoba & Bhat, Chartered Accountants, Bangalore retire at the ensuing Annual General Meeting. It is proposed to re-appoint them.

10. REPORT ON CORPORATE GOVERNANCE:

A separate report on Corporate Governance is given in the Annexure A&B.

11. Clause 49 of the Listing Agreement:

a. During the year under report the trading of the company's securities has not been suspended by the Stock Exchanges with which the shares are listed.

b. The names and addresses of the Stock Exchanges with which the company's Securities are listed are as follows:

i) Bangalore Stock Exchange Ltd, 51, Stock ExchangeTowers, 1 "cross, JC Road, Bangalore 560 027

ii) The Stock Exchange Mumbai, PJ Towers, Dalai street,Mumbai-400001

iii) Coimbatore Stock Exchange Ltd, Stock exchange building.CSX Towers, 683-686,Trichy road, Singanallur,Coimbatore-641 005.

c. The annual listing fees of the above Stock Exchanges have been paid.

12. ACKNOWLEDGEMENTS:

The Management wishes to place on record its sincere thanks and appreciation to State Bank of India, Specialised Commercial Branch, Bangalore-1, for their financial support and guidance, "and its appreciation for the excellent co-operation extended by the staff & workers of the company. Management also wishes to place on record its appreciation for the valuable support extended by various Government agencies at Bangalore and Pondicherry.

For & on behalf of the Board

S.GOPALAN CHAIRMAN

Place: Bangalore Date: 28th May, 2011

Mar 31, 2010

The directors hereby present the Seventeenth Annual Report together with the Audited Accounts of the company for the year ended 31 st March 2010.

1. FINANCIAL RESULTS:

The Comparative financial results forthe period are as under:

2009-10 2008-09

(Rs. In lacs) (Rs. In lacs)

Sales & other income 2,948.98 2605.64

Profit before Depreciation

and interest 817.41 745.06

Depreciation & Preliminary exp 145.87 118.19

Interest 30.53 9.84

Profit/(Loss) before tax 641.00 616.33

Provision for taxation 205.72 213.72

Deferred tax 8.71 5.12

Profit/(Loss) aftertax 426.56 397.51

Amount transferred to reserves 10.66 9.94

2. PERFORMANCE & PROSPECTS :

During the year under review, the companys turnover increased by 13% and the company has earned a Net profit (before tax) of Rs.641.00 lacs as against net profit of Rs.616.33 lacs in the previous year. An amount of Rs.565.00 lacs was ploughed back from profits for funding the ongoing expansion at Pondicherry. The export of the company has increased by 33% during the year under consideration. Though there is drop in sales realization due to rupee appreciation, with the commissioning of new machineries in phases in the current year your Directors are hopeful of maintaining the performance.

3. PERFORMANCE CREDIT RATING:

Your Directors are pleased to inform you that the Company has obtained "CRISIL" rating of "SME-1" indicating HIGHEST PERFORMANCE CAPACITY AND HIGH FINANCIAL STRENGTH for second successive year.

4. DIVIDEND:

While considering the need for conservation of resources for ongoing expansion, your Directors are pleased to recommend a dividend of Rs 1.20 per equity share of Rs 10/-each for the year ended 31-3-2010for the members whose names appear in the register of members as on the date of AGM viz., 28.9.2010.

5. EXPANSION:

During the year under consideration, the company has already installed one imported machinery at Pondicherry and other 8 machines are in various stages of installation. With the commissioning of all the machines, the installed capacity of company will increase to 7.35 billion capsules per annum.

6. DIRECTORS:

Mr. V.Subramony and Mr SushilkumarMundra retire at this Annual General Meeting and being eligible, offer themselves for re-appointment.

7. DISCLOSURE OF PARTICULARS AS PER BOARDS REPORT RULES1988:

A. CONSERVATION OF ENERGY:

The particular as per form Ais attached to this report.

B. RESEARCH & DEVELOPMENT AND TECHNOLOGY ABSORPTION:

Company is having an ongoing research and development activity to develop value added products.

C. FOREIGN EXCHANGE, EARNINGS & OUTGO:

Foreign exchange earning :Rs. 507.90 lacs

Foreign exchange outgo :Rs. 8.88 "

8. DIRECTORS RESPONSIBILITY STATEMENT:

A) In the preparation of the annual accounts, the applicable accounting Standards have been followed.

B) The directors have selected such accounting policies and applied them consistently and made judgements 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 of the company for the period.

C) The directors have taken proper and sufficient care for 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 any fraud or other Irregularities.

D) The directors have prepared the annual accounts on a going concern basis.

9. AUDITORS:

M/S. Gnanoba & Bhat, Chartered Accountants, Bangalore retire at the ensuing Annual General Meeting. It is proposed to re-appoint them.

10. REPORT ON CORPORATE GOVERNANCE:

A separate report on Corporate Governance is given in the Annexure A& B.

ll.CLAUSE 49 OF THE LISTING AGREEMENT:

a. During the year under report the trading of the companys securities has not been suspended by the Stock Exchanges with which the shares are listed.

b. The names and addresses of the Stock Exchanges with which the companys Securities are listed are as follows:

i) Bangalore Stock Exchange Ltd, 51, Stock Exchange towers, 1st cross, JC Road, Bangalore - 560 027 ii) Bombay Stock Exchange Mumbai, PJ Towers, Dalai street, Mumbai-400 001 iii) Coimbatore Stock Exchange Ltd, Stock exchange building, CSX Towers, 683-686,Trichy road, Singanallur, Coimbatore - 641 005 c. The annual listing fees of the above Stock Exchanges have been paid.

ACKNOWLEDGMENTS:

The Management wishes to place on record its sincere thanks and appreciation to State Bank of India, Specialised Commercial Branch, Bangalore-1, for their financial support and guidance, and its appreciation for the excellent co-operation extended by the staff & workers of the company. The Management also wishes to place on record its apprecitation for the valuable support extended by various Government agencies at Bangalore and Pondicherry.

For & on behalf of the Board

Place: Bangalore

Date: 22nd May, 2010

S.GOPALAN*

CHAIRMAN

Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article