Management Discussion and Analysis Report. Auditors' Certificate on Corporate Governance

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3 Care, Concern and Cure... CONTENT Company Information Notice of Annual General Meeting Directors' Report Management Discussion and Analysis Report Report on Corporate Governance Auditors' Certificate on Corporate Governance Certificate from Managing Director Independent Auditors' Report Balance Sheet Profit and Loss Statement Cash Flow Statement Notes to Financial Statement Statement of Subsidiary Companies Independent Auditors' Report on Consolidated Financial Statement Consolidated Balance Sheet Consolidated Profit & Loss Statement Consolidated Cash Flow Statement Notes to Consolidated Financial Statement Attendance Slip & Proxy Form 85

4 30 Annual Report Board of Directors Executive Directors Mr. Manohar Lal Gupta Chairman Mr. Vinod Kumar Gupta Managing Director Mr. Govind Das Garg Whole-Time Director Mr. Anil Mittal Whole-Time Director & Chief Executive Non-Executive Directors Mr. Satish Chandra Consul Independent Director Mr. Dharam Pal Khanna Independent Director Mr. Dilip Kumar Panchaity Independent Director Mr. Dilip Kumar Sinha Independent Director Ms. Aradhana Kulkarni Company Secretary & Compliance Officer Regiered Office 340, Laxmi Plaza, Laxmi Indurial Eate, New Link Road, Andheri (We), Mumbai (Maharashtra) website: Corporate Office & Inveors Grievances Centre Shree Ganesh Chambers, Navlakha Crossing, A. B. Road, Indore (Madhya Pradesh) Auditors M/s. T.N. Unni & Co. Chartered Accountants, 402, Alankar Point, Geeta Bhawan Square, Indore (Madhya Pradesh) Bankers State Bank of India Punjab National Bank Manufacturing Locations Madhya Pradesh Village Asrawad, Po Dudhia, Nemawar Road, Indore Himachal Pradesh Village Bhud, Tehsil Nalagarh, Di. Solan Regirar and Share Transfer Agent Link Intime India Private Limited C-13, Kantilal Maganlal Eate, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (We), Mumbai Tel. No.: Fax No.: rnt.helpdesk@linkintime.co.in 02

5 Care, Concern and Cure... N O T I C E NOTICE is hereby given at e 30 Annual General Meeting of e members of Parenteral Drugs (India) Limited will be held on Tuesday, e 30 day of September, 2014, at 9.30 a.m. at The Classique Club, Behind Infinity Mall, Link Road, Oshiwara, Andheri (We), Mumbai to transact e following business:- ORDINARY BUSINESS 1. To consider, approve and adopt e Balance Sheet of e company as on 31 March, 2014 and e Profit and Loss Account for e year ended on at date and e reports of e Directors' and e Statutory Auditors' ereon. 2. To re-appoint Shri Govind Das Garg, Whole-Time Director of e company, who is liable to retire by rotation and being eligible offers himself for re-appointment. 3. To re-appoint e Statutory Auditors of e Company to hold e office from e conclusion of ensuing Annual General Meeting till e conclusion of next Annual Genereal Meeting of e company and to fix eir remuneration. SPECIAL BUSINESS ITEM NO. 4 APPOINTMENT OF SHRI DILIP KUMAR SINHA AS NON-EXECUTIVE INDEPENDENT DIRECTOR OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as an Ordinary Resolution: RESOLVED THAT pursuant to e provision of sections 149, 152 and oer applicable provisions of e Companies Act, 2013 read wi Schedule IV to e Companies Act, 2013, Companies (Appointment and Qualification of Directors) Rules, 2014 (including any atutory modification(s) or re-enactment ereof for e time being in force) and Clause 49 of e Liing Agreement, Shri Dilip Kumar Sinha (DIN: ), Director of e Company, who has submitted a declaration at he meets e criteria for independence as provided in section 149(6) of e Companies Act, 2013 and who is eligible for appointment and in respect of whom e Company has received notice in writing from a member under section 160 of e Companies Act, 2013 proposing his candidature for e office of director, be and is hereby appointed as an Independent Director of e Company to hold office for five(5) consecutive years from 1 October, 2014 upto 30 September, 2019; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorised to do all such acts, deeds or ings to give effect to e aforesaid resolution. ITEM NO. 5 APPOINTMENT OF SHRI DHARAM PAL KHANNA AS NON-EXECUTIVE INDEPENDENT DIRECTOR OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as an Ordinary Resolution: RESOLVED THAT pursuant to e provision of sections 149, 152 and oer applicable provisions of e Companies Act, 2013 read wi Schedule IV to e Companies Act, 2013, Companies (Appointment and Qualification of Directors) Rules, 2014 (including any atutory modification(s) or re-enactment ereof for e time being in force) and Clause 49 of e Liing Agreement, Shri Dharam Pal Khanna (DIN: ), Director of e Company, who has submitted a declaration at he meets e criteria for independence as provided in section 149(6) of e Companies Act, 2013 and who is eligible for appointment and in respect of whom e Company has received notice in writing from a member under section 160 of e Companies Act, 2013 proposing his candidature for e office of director, be and is hereby appointed as an Independent Director of e Company to hold office for five(5) consecutive years from 1 October, 2014 upto 30 September, 2019; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorised to do all such acts, deeds or ings to give effect to e aforesaid resolution. NOTICE OF ANNUAL GENERAL MEETING 03

6 30 Annual Report NOTICE OF ANNUAL GENERAL MEETING ITEM NO. 6 APPOINTMENT OF SHRI DILIP KUMAR PANCHAITY AS NON-EXECUTIVE INDEPENDENT DIRECTOR OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as an Ordinary Resolution: RESOLVED THAT pursuant to e provision of sections 149, 152 and oer applicable provisions of e Companies Act, 2013 read wi Schedule IV to e Companies Act, 2013, Companies (Appointment and Qualification of Directors) Rules, 2014 (including any atutory modification(s) or re-enactment ereof for e time being in force) and Clause 49 of e Liing Agreement, Shri Dilip Kumar Panchaity (DIN: ), Director of e Company, who has submitted a declaration at he meets e criteria for independence as provided in section 149(6) of e Companies Act, 2013 and who is eligible for appointment and in respect of whom e Company has received notice in writing from a member under section 160 of e Companies Act, 2013 proposing his candidature for e office of director, be and is hereby appointed as an Independent Director of e Company to hold office for five(5) consecutive years from 1 October, 2014 upto 30 September, 2019; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorised to do all such acts, deeds or ings to give effect to e aforesaid resolution. ITEM NO.7 APPOINTMENT OF SHRI SATISH CHANDRA CONSUL AS NON-EXECUTIVE INDEPENDENT DIRECTOR OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as an Ordinary Resolution: RESOLVED THAT pursuant to e provision of sections 149, 152 and oer applicable provisions of e Companies Act, 2013 read wi Schedule IV to e Companies Act, 2013, Companies (Appointment and Qualification of Directors) Rules, 2014 (including any atutory modification(s) or re-enactment ereof for e time being in force) and Clause 49 of e Liing Agreement, Shri Satish Chandra Consul (DIN: ), Director of e Company, who has submitted a declaration at he meets e criteria for independence as provided in section 149(6) of e Companies Act, 2013 and who is eligible for appointment and in respect of whom e Company has received notice in writing from a member under section 160 of e Companies Act, 2013 proposing his candidature for e office of director, be and is hereby appointed as an Independent Director of e Company to hold office for five(5) consecutive years from 1 October, 2014 upto 30 September, 2019; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorised to do all such acts, deeds or ings to give effect to e aforesaid resolution. ITEM NO.8 RATIFICATION OF REMUNERATION OF COST AUDITOR OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as an Ordinary Resolution: RESOLVED THAT pursuant to e provisions of section 148 and oer applicable provisions of e Companies Act, 2013 read wi Companies (Audit and Auditors) Rules, 2014 (including any atutory modification(s) or re-enactment ereof, for e time being in force) and as recommended by e Audit Committee, M/s. A. Goyal & Co., Co Accountant, Jaipur (Firm Regiration No ), were appointed as Co Auditors by e Board of Directors of e Company, to conduct e audit of e co records of e Company for e financial year ending 31 March, 2015 and e members of e company hereby ratify e payment of remuneration to e Co Auditors of Rs. 70,000/- (Rupees Seventy Thousand Only) plus service tax, as applicable and out of pocket expenses; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorised to do all such acts, deeds and ings as may be required to give effect to e aforesaid resolution. 04

7 Care, Concern and Cure... ITEM NO. 9 RE-APPOINTMENT OF SHRI GOVIND DAS GARG AS WHOLE-TIME DIRECTOR OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as a Special Resolution: RESOLVED THAT pursuant to e provision of sections 196,197 and oer applicable provisions, if any, of e Companies Act, 2013 read wi Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Schedule V to e Companies Act, 2013, as amended from time to time and as recommended by e Nomination and Remuneration Committee and e Board of Directors of e Company, approval of members of e Company be and is hereby accorded to re-appoint Shri Govind Das Garg (DIN: ) as Whole-Time Director of e Company for a period of ree(3) years w.e.f. 1 January, 2015 on a consolidated monly remuneration of Rs. 1,25,000/- (Rupees One Lac Twenty Five Thousand Only) and contribution to Provident and Gratuity Fund as may be applicable and will be liable to retire by rotation under e provisions of section 152 of e Companies Act, 2013; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e Company be and is hereby auorised to file necessary forms wi e Regirar of Companies, Maharashtra, as may be required under e provisions of e Companies Act, 2013 in is regard. ITEM NO. 10 ADOPTION OF NEW SET OF ARTICLES OF ASSOCIATION OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as a Special Resolution: RESOLVED THAT pursuant to e provisions of section 14 and oer applicable provisions of Companies Act, 2013 read wi Companies (Incorporation) Rules, 2014 (including any atutory modification(s) or re-enactment ereof, for e time being in force), e draft regulations contained in e Articles of Association submitted to is meeting be and are hereby adopted in subitution of e regulation contained in e exiing Articles of Association of e company; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorized to do all such acts, deeds and to take all necessary actions in is regard including filing of forms, if any, wi e Regirar of Companies, Maharashtra. ITEM NO. 11 AUTHORITY TO CREATE CHARGE OVER THE ASSETS OF THE COMPANY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as a Special Resolution: RESOLVED THAT pursuant to e provisions of section 180(1)(a) and oer applicable provisions, if any, of e Companies Act, 2013 (including any atutory modification(s) or re-enactment ereof for e time being in force) and e applicable rules made ereunder, approval of e members of e company be and is hereby accorded to e Board of Directors of e company (hereinafter referred to as 'e Board') to create mortgages and charges in addition to e exiing mortgages and charges already created or to be created by e company, as e Board may decide, on e assets of e company, wheer movable or immovable, bo present and future, in favour of lender banks to secure various financial facilities extended by em to e company to e tune of Rs Crores (Rupees Four Hundred Fifty One Crore and Ninety Three Lacs Only); RESOLVED FURTHER THAT all monies already borrowed wiin e aforesaid limit and charges already created and satisfied and oer eps taken in respect of e financial facilities availed by e company during e financial year from e above Bankers and also from any oer bank or financial initution and e documents executed by e Board in respect of e said financial facilities be and are hereby ratified and confirmed; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorized to do all such acts, deeds and to take all necessary actions in is regard including filing of forms, if any, wi e Regirar of Companies, Maharashtra. ITEM NO. 12 AUTHORITY TO THE BOARD OF DIRECTORS TO BORROW MONEY To consider and if ought fit, to pass wi or wiout modification(s), e following resolution as a Special Resolution: RESOLVED THAT in suppression of e resolution passsed at e Annual General Meeting of e members of e company held on 28 December, 2009 and pursuant to e provisions of section 180(1)(c) and oer applicable provisions of e Companies Act, 2013 and e rules made ere under (including any atutory modification(s) or reenactment ereof for e time being in force) approval of e members of e company be and is hereby accorded to NOTICE OF ANNUAL GENERAL MEETING 05

8 30 Annual Report e Board of Directors (hereinafter referred to as e Board ) to borrow any sum(s) of money, from time to time, from any one or more of e bankers of e company and/or from any one or more oer persons, firms, body corporate or financial initutions wheer by way of cash credit, advances or deposits, loans or bill discounting, issue of debentures, bonds or oerwise and wheer secured or unsecured by mortgage, hypoeciation, charge, lien or pledge on assets and properties of e company, wheer immovable or movable, ock in trade (including raw materials, ores, spare parts and components in ock or in transit) and work in progress and all or any of e undertakings of e company notwianding e monies to be borrowed togeer wi e monies already borrowed by e company (apart from temporary loans obtained from e bankers of e company in e ordinary course of business) exceeds e aggregate of e paid-up share capital and free reserves of e Company, provided at e total amount borrowed by e Board and outanding at any point of time, in e ordinary course of business, shall not exceed Rs Crores (Rupees One Thousand Crores Only); RESOLVED FURTHER THAT e Board of e Company be and is hereby auorised to execute all such documents, debentures, tru deed or mortgage, charge, hypoeciation, lien, promissory notes, deposit receipts and inruments, or writings containing such conditions and covenants as e Board may ink fit; RESOLVED FURTHER THAT Shri Vinod Kumar Gupta, Managing Director of e company be and is hereby auorized to do all such acts, deeds and to take all necessary actions in is regard including filing of forms, if any, wi e Regirar of Companies, Maharashtra. Place: Indore Date: 14 Augu, 2014 BY ORDER OF THE BOARD Vinod Kumar Gupta Managing Director NOTICE OF ANNUAL GENERAL MEETING 06

9 Care, Concern and Cure... N O T E S 1. Statement pursuant to section 102 of e Companies Act, 2013 relating to e Special Business to be transacted at e Annual General Meeting is annexed hereto. 2. A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE ON HIS / HER BEHALF AND THE PROXY NEED NOT BE A MEMBER OF THE COMPANY. A person can act as proxy on behalf of members not exceeding fifty (50) and holding in aggregate not more an ten percent of e total share capital of e Company. In case a proxy is proposed to be appointed by a member holding more an 10% of e total share capital of e Company carrying voting rights, en such proxy shall not act as a proxy for any oer member. The inrument of proxy, in order to be effective, should be deposited at e Regiered Office of e Company, duly completed and signed, not later an 48 hours before e commencement of e meeting. A Proxy Form is annexed to is Report. Proxies submitted on behalf of limited companies, societies, etc., mu be supported by an appropriate resolution / auority, as applicable. 3. Members holding shares in physical form are requeed to forward all applications for transfer and all oer share related correspondence (including intimation for change of address) to e Share Transfer Agent of e Company at e following address: Link Intime India Private Limited, C-13, Kantilal Maganlal Eate, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (We), Mumbai The members are requeed to: a. Intimate to e Regirar/ Company, changes, if any, in eir regiered address at an early date along wi e PIN code. b. Quote regiered folio/client ID and DP ID in all eir correspondence. 5. Members holding shares in dematerialized form (electronic form) are requeed to intimate any change in eir address, bank mandate etc., directly to eir respective depository participants. rd 6. The Regier of Members and e Share Transfer Books of e Company will remain closed from 23 September, 2014 to 30 September, 2014 (bo days inclusive). 7. Electronic copy of e Annual Report is being sent to all e members whose IDs are regiered wi e company/depository Participants unless any member has requeed for a hard copy of e same for members who have not regiered eir address, physical copies of e Annual Report is being sent in e permitted mode. 8. Corporate members are requeed to send a duly certified copy of e Board Resolution auorizing eir representatives to attend and vote on eir behalf at e meeting. 9. To promote green initiative, members are requeed to regier eir addresses rough eir Depository Participant for sending e future communications by . Members holding e shares in physical form may regier eir addresses rough e Regirar and Share Transfer Agent, giving reference of eir folio number. 10. A member who has not claimed his/her dividend for e years to are requeed to write to e Regirar and Share Transfer Agent to claim his/her dividend. Pursuant to provisions of section 205A(5) of e Companies Act, 1956, dividend which remain unpaid/unclaimed for a period of 7 years from e date of transfer of e same to e Company's unpaid dividend account will be transferred to e Inveor Education and Protection Fund eablished by e Central Government. Furer, e Company shall not be in a position to entertain e claims of shareholders for e unclaimed part of e dividend paid for e financial year , after e la date i.e. 28 September, NOTICE OF ANNUAL GENERAL MEETING 07

10 30 Annual Report In accordance wi e provisions of section 72 of e Companies Act, 2013, members are entitled to make nomination in respect of Equity Shares held by em, in physical form. Members desirious of making nomination may avail e facility of nomination by nominating in e prescribed Nomination Form ; a person to whom his/her shares in e Company shall ve in e event of his/her dea. 12. Voting rough electronic means Pursuant to e provisions of section 108 of e Companies Act, 2013 and Rule 20 of e Companies (Management and Adminiration) Rules, 2014, e Company is pleased to provide its members, e facility to exercise eir right to vote at e 30 Annual General Meeting by electronic means. The business may be transacted rough e-voting services provided by Central Depository Services (India) Limited (CDSL). The inructions for members for voting electronically are as under:- In case of members receiving (i) Log on to e e-voting website (ii) Click on Shareholders tab. (iii) Now, select e COMPANY NAME from e drop down menu and click on SUBMIT (iv) Now, enter your User ID a. For CDSL: 16 digit beneficiary ID, b. For NSDL: 8 Character DP ID followed by 8 Digit Client ID, c. Members holding shares in Physical Form should enter Folio Number regiered wi e Company. (v) Next, enter e Image Verification as displayed and Click on Login. (vi) If you are holding shares in demat form and had logged on to and voted on an earlier voting of any company, en your exiing password is to be used. (vii) If you are a fir time user follow e eps given below: NOTICE OF ANNUAL GENERAL MEETING PAN* DOB# Dividend Bank Details# For Members holding shares in Demat Form and Physical Form Enter your 10 digit alpha-numeric *PAN issued by e Income Tax Department (applicable for bo demat shareholders as well as physical shareholders) Members who have not updated eir PAN wi e Company/Depository Participant are requeed to use e fir two letters of eir name and e la 8 digits of e demat account/folio number in e PAN field. In case, e folio number is less an 8 digits enter e applicable number of 0's before e number after e fir two characters of e name in CAPITAL letters eg. if, your name is Ramesh Kumar wi folio number 100 en enter RA in e PAN field. Enter e Date of Bir as recorded in your demat account or in e company records for e said demat account or folio in dd/mm/yyyy format. Enter e Dividend Bank Details as recorded in your demat account or in e company records for e said demat account or folio. Please enter e DOB or Dividend Bank Details in order to login. If e details are not recorded wi e depository or company, please enter e number of shares held by you as on e cut off date in e Dividend Bank details field. (viii) After entering ese details appropriately, click on SUBMIT tab. (ix) Members holding shares in physical form will en reach directly e Company selection screen. However, members holding shares in demat form will now reach 'Password Creation' menu wherein ey are required to mandatorily enter eir login password in e new password field. Kindly note at is password is to be also used by e demat holders for voting for resolutions of any oer company on which ey are eligible to vote, provided at company opts for e-voting rough CDSL platform. It is rongly recommended not to share your password wi any oer person and take utmo care to keep your password confidential. 08

11 Care, Concern and Cure... (x) For Members holding shares in physical form, e details can be used only for e-voting on e resolutions contained in is Notice. (xi) Click on e EVSN for e relevant <Company Name> on which you choose to vote. (xii) On e voting page, you will see RESOLUTION DESCRIPTION and again e same e option YES/NO for voting. Select e option YES or NO as desired. The option YES implies at you assent to e Resolution and option NO implies at you dissent to e Resolution. (xiii) Click on e RESOLUTIONS FILE LINK if you wish to view e entire Resolution details. (xiv) After selecting e resolution you have decided to vote on, click on SUBMIT. A confirmation box will be displayed. If you wish to confirm your vote, click on OK, else to change your vote, click on CANCEL and accordingly modify your vote. (xv) Once you CONFIRM your vote on e resolution, you will not be allowed to modify your vote. (xvi) You can also take out print of e voting done by you by clicking on CLICK HERE TO PRINT option on e Voting page. (xvii) If Demat account holder has forgotten e changed password en enter e User ID and e image verification code and click on Forgot Password & enter e details as prompted by e syem. Initutional shareholders (i.e. oer an Individuals, HUF, NRI, etc.) are required to log on to and regier emselves as Corporates. They should submit a scanned copy of e Regiration Form bearing e amp and sign of e entity to helpdesk.evoting@cdslindia.com. After receiving e login details ey have to create a user who would be able to link e account(s) which ey wish to vote on. The li of accounts should be mailed to helpdesk.evoting@cdslindia.com and on approval of e accounts ey would be able to ca eir vote. They should upload a scanned copy of e Board Resolution and Power of Attorney (POA) which ey have issued in favour of e Cuodian, if any, in PDF format in e syem for e scrutinizer to verify e same. In case of members receiving e physical copy: (A) Please follow all eps from sl. no. (i) to sl. no. (xvii) above to ca vote. (B) The voting period begins on 24 September, 2014 at 9.00 a.m. and ends on 26 September, 2014 at 6.00 p.m. During is period, shareholders of e company, holding shares eier in physical form or in dematerialized rd form, as on e cut-off date (record date) i.e. 23 September, 2014, may ca eir vote electronically. The e-voting module shall be disabled by CDSL for voting ereafter. In case you have any queries or issues regarding e-voting, you may refer e Frequently Asked Queions ( FAQs ) and e-voting manual available at under help section or write an to helpdesk.evoting@cdslindia.com or contact at CDSL helpline Tel. No (xviii)the Company has appointed Shri R. K. Nuwal, Chartered Accountants, as e Scrutinizer who will scrutinize e electronic voting process in a fair and transparent manner. (xix) The Scrutinizer shall wiin a period not exceeding ree working days from e conclusion of e e-voting period unblock e votes in e presence of at lea two witnesses not in e employment of e Company and make a Scrutinizer's Report of e votes ca in favour or again, if any, forwi to e Chairman of e Company. (xx) The results shall be declared on or after e AGM of e Company. The results along wi e Scrutinizer's Report shall be placed on e Company's website. NOTICE OF ANNUAL GENERAL MEETING 09

12 30 Annual Report NOTICE OF ANNUAL GENERAL MEETING STATEMENT UNDER SECTION 102 OF THE COMPANIES ACT, 2013 ITEM NO. 4 TO 7 According to clause 49 of e Liing Agreement, in case, where e Chairman is Executive Director, at lea half of e Board should comprise of Independent Directors. Furer, section 149 of e Companies Act, 2013 (hereinafter referred to as e Act ) requires all lied public companies to have at lea one-ird of e total number of directors as Independent Directors. Keeping in view, e requirements of e Liing Agreement and e Act, your Company complies wi e said requirements. Sub-section (10) of section 149 of e Act furer provides at Independent Directors can hold office for a term upto five consecutive years on e Board of a company and can be re-appointed ereafter subject to e limit as specified under sub-section (11) of section 149 of e Act. Furer, in terms of sub-section (13) of section 149 read wi explanation to sub-section (6) of section 152 of e Act, Independent directors are not liable to retire by rotation. The following directors on e Board of your Company qualify as Independent Directors under section 149 of e Act and clause 49 of e Liing Agreement: 1. Shri Dilip Kumar Sinha 2. Shri Dharam Pal Khanna 3. Shri Dilip Kumar Panchaity 4. Shri Satish Chandra Consul These directors were duly appointed under e Companies Act, 1956 as directors liable to retire by rotation. In order to give effect to e aforesaid provisions of e Act, it is proposed at ese directors be appointed as Independent Directors under section 149 of e Act read wi e clause 49 of e Liing Agreement, to hold office for five(5) consecutive years, for a term commencing from 1 October, 2014 till 30 September, None of e aforenamed directors are disqualified from being appointed as directors in terms of section 164 of e Act and have given eir consent to act as directors. The Company has received declarations from all e above directors at ey meet wi e criteria of independence as prescribed under sub-section (6) of Section 149 of e Act. According to proviso to sub-section (5) of section 152 of e Act, in e opinion of e Board, ey fulfill e conditions for eir appointment as Independent Directors as specified in e Act. They are independent of e management. Brief resumes of ese directors, nature of eir expertise in specific functional areas and name of companies in which ey hold directorship / membership / chairmanship of e Board / Committees, as ipulated under clause 49 of e Liing Agreement wi e Stock Exchange(s), are provided in e Corporate Governance Report, forming part of is Annual Report. Keeping in view eir expertise and knowledge, it will be in e intere of e Company at ese directors are appointed as Independent Directors. Copy of e draft letter for appointment of ese directors as Independent Directors setting out e terms and conditions are available for inspection by members at e Regiered Office of e Company. Except for e respective directors and eir relatives who may be deemed to be intereed in e respective resolutions set out in Item Nos. 4 to 7 of e Notice as it is concerned to eir appointment as Independent Directors. None of e oer directors, Key Managerial Personnel of e Company and eir relatives are, in any way, concerned or intereed, financially or oerwise, in e respective resolutions set out at Item Nos.4 to 7 of e Notice. The Board recommend e resolutions set out in Item Nos. 4 to 7 of e Notice for approval by e shareholders as an Ordinary Resolution. ITEM NO. 8 The Board, on e recommendation of e Audit Committee, appointed M/s. A. Goyal & Co., Co Accountants, as Co Auditors for conducting co audit of e co records of e Company for e financial year ending on 31 March, 2015, at a remuneration of Rs. 70,000/- (Rupees Seventy Thousand Only) plus service tax, as applicable and out of pocket expenses. In accordance wi section 148 of e Companies Act, 2013 read wi Rule 14 of e Companies (Audit and Auditors) Rules, 2014, e remuneration so payable to e Co Auditors are required to be ratified by e shareholders of e Company. 10

13 Care, Concern and Cure... Hence, e resolution set out in Item No.8 of e accompanying Notice, which your Board recommends for your approval as an Ordinary Resolution. None of e Directors, Key Managerial Personnel of e Company or eir relatives are concerned or intereed, financially or oerwise, in e said resolution. ITEM NO. 9 Shri Govind Das Garg is aged 67 years and is a promoter director of e company and has been managing e affairs of e company on day to day basis from very beginning. He was re-appointed as Whole-Time Director of e company on 30 September, 2011 for a period of ree (3) years commencing from 1 January, 2012 and his tenure as Whole-Time Director is expiring on 31 December, The Nomination and Remuneration Committee and e Board of Directors of e company recommended his appointment at eir meeting held on 13 Augu, 2014 and 14 Augu, 2014 respectively and will be liable to retire by rotation. Furer, e company complies wi e conditions as set out in Section II of Part II of Schedule V of e Companies Act, Details of e Whole-Time Director as required under clause (iv) of Section II of Part II of Schedule V of e Companies Act, 2013 are as under: I. General Information: (1) Nature of indury: Pharmaceutical (2) Date or expected date of commencement of commercial production: 02/07/1986 (3) Financial performance based on given indicators: On andalone basis, during e financial year , e Company recorded a turnover of Rs crores and recorded a loss after tax of Rs crores. (4) Foreign invements or collaborations, if any: Invement in overseas subsidiaries of e company II. Information about e appointee: (1) Background details: * Name: Shri Govind Das Garg * Faer's Name: Shri Fakir Chand Agrawal * Date of Bir: 10 October, 1946 * Residential Address: 5, Anand Bagichi, Agrawal Nagar, Indore (Madhya Pradesh) (2) Pa remuneration: Rs. 1,00,000/- p.m. (Rupees One Lac Only) and contribution to Provident and Gratuity Fund as may be applicable. (3) Recognition or awards: None (4) Job profile and his suitability: Shri Garg has 36 years of working experience in diversified business activities including experience in pharmaceutical indury. He is basically looking into procurement and technical issues in e company. He has been working as Whole-Time Director of e Company since 1994 and has made pioneering contribution in grow of e company. (5) Remuneration proposed: Rs. 1,25,000/- p.m. (Rupees One Lac Twenty Five Thousand Only) and contribution to Provident and Gratuity Fund as may be applicable. (6) Comparative remuneration profile wi respect to indury, size of e company, profile of e position and person (in case of expatriates e relevant details would be wi respect to e country of his origin): Remuneration proposed to be paid to e Whole-Time Director is on e lower side of e indury norms, size of e company and looking to e profile of e said Whole-Time Director. (7) Pecuniary relationship directly or indirectly wi e company, or relationship wi e managerial personnel, if any: Shri Garg does not have any pecuniary relationship wi e Company, oer an receipt of remuneration as a Whole-Time Director. Furer, Shri Vinod Kumar Gupta, Shri Manohar Lal Gupta and Shri Govind Das Garg are related to each oer and are e promoter directors of e company. NOTICE OF ANNUAL GENERAL MEETING 11

14 30 Annual Report NOTICE OF ANNUAL GENERAL MEETING III. Oer information: (1) Reasons of loss or inadequate profits: The loss or inadequate profit is due to decrease in turnover and oer market factors. (2) Steps taken or proposed to be taken for improvement: The Company is under process to gear up its sales and marketing team in order to improve turnover of e company. (3) Expected increase in productivity and profits in measurable terms: The Company will try to achieve e andards of its pa performance. IV. Disclosures: The following disclosures are mentioned in e Directors Report under e heading "Corporate Governance", forming part of e financial atement: (i) all elements of remuneration package such as salary, benefits, bonuses, ock options, pension, etc., of all e directors; (ii) details of fixed component and performance linked incentives along wi e performance criteria; (iii) service contracts, notice period, severance fees; (iv) ock option details, if any, and wheer e same has been issued at a discount as well as e period over which accrued and over which exercisable. Also, according to e provisions of section 190 of e Companies Act, 2013, a contract of service wi Shri Garg, Whole- Time Director of e company is available for inspection of members at e regiered office of e company. In terms of provision of sections 196, 197 and oer provisions applicable, if any, of e Companies Act, 2013 read wi Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Schedule V to e Companies Act, 2013 approval of e members of e Company is required for his re-appointment as Whole-Time Director of e Company for a furer period of ree(3) years by way of passing e proposed resolution as a Special Resolution. Hence, e resolution set out in Item No. 9 of e accompanying Notice, which your Board recommends for your approval. None of e Directors, Key Managerial Personnel and eir relatives are concerned or intereed financially or oerwise in e resolution set out in Item No. 9 except Shri Govind Das Garg for himself, Shri Vinod Kumar Gupta and Shri Manohar Lal Gupta and eir relatives. ITEM NO.10 The present set of Articles of Association of e Company is in accordance wi e provisions of Companies Act, 1956 contains reference to specific provisions of e Companies Act, 1956 and some regulations in e exiing Articles of Association are no longer in conformity wi e Companies Act, Wi e coming into force of e Companies Act, 2013, several regulations of e exiing Articles of Association of e Company require alteration or deletions. Thus, it is considered expedient to wholly replace e exiing Articles of Association of e company by a new set of Articles. The new Articles of Association to be subituted in place of e exiing Articles of Association are based on Table 'F' of e Companies Act, 2013 which sets out e model Articles of Association for a company limited by shares. The proposed draft Articles of Association are available for inspection at e regiered office of e company on working days during business hours. Therefore, in terms of provisions of section 14 of e Companies Act, 2013 approval of e members of e company is sought for passing e proposed resolution as a Special Resolution. The directors recommend passing of e resolution as a Special Resolution. None of e Directors, Key Managerial Personnel of your Company and eir relatives are deemed to be concerned or intereed, financially or oerwise, in e resolution set out in Item No.10 of e accompanying Notice. ITEM NO.11 The members of e Company had at e 29 Annual General Meeting held on 30 September, 2013, passed an Ordinary Resolution under provisions of section 293(1)(a) of e Companies Act, 1956, granting eir consent to create security in favour of e bankers of e company to e tune of Rs Crores (Rupees Four Hundred Fifty One Crores and Ninety Three Lacs Only). 12

15 Care, Concern and Cure... According to e provisions of section 180(1)(a) of e Companies Act, 2013, consent of e members of e company is required by way of passing a Special Resolution auorising e Board of Directors to sell, lease or oerwise dispose off e whole or subantially e whole of e undertaking(s) of e Company. Since, mortgaging or charging e movable and/or immovable properties and assets of e Company wi e right of taking over management or control in certain events of default may be considered to be disposal of e Company's undertaking wiin e meaning of section 180(1)(a) of e Companies Act, So, it is proposed to seek approval of e shareholders for creating such mortgages and/or charges on e assets and properties of e Company, bo present and future. Hence, e resolution set out in Item No. 11 of e accompanying Notice, which e Board recommends for your approval as a Special Resolution. None of e Directors, Key Managerial Personnel of e Company and eir relatives are concerned or intereed, financially or oerwise, in e resolution set out in Item No. 11 of e accompanying Notice. ITEM NO.12 The members of e Company had at e 25 Annual General Meeting held on 28 December, 2009, passed an Ordinary Resolution under e provisions of section 293(1)(d) of e Companies Act, 1956, granting eir consent to borrow monies not exceeding a sum of Rs Crores (Rupees One Thousand Crores Only). According to e provisions of section 180(1)(d) of e Companies Act, 2013, consent of e members of e company is required by way of passing a Special Resolution to auorise e Board of Directors to borrow money, where e money to be borrowed, togeer wi e money already borrowed by e company will exceed aggregate of paid-up capital and free reserves, apart from temporary loans obtained from e bankers of e company in e ordinary course of business. Since, e borrowing of e company togeer wi e monies already borrowed by e company exceeds aggregate of paid-up capital and free reserves. Thus, it is proposed to seek approval of e members as mentioned in e resolution set out in Item No. 12 of e accompanying Notice, which e Board recommends for your approval as a Special Resolution. None of e Directors, Key Managerial Personnel of e Company and eir relatives are concerned or intereed, financially or oerwise, in e resolution set out in Item No. 12 of e accompanying Notice. Place: Indore Date: 14 Augu, 2014 BY ORDER OF THE BOARD Vinod Kumar Gupta Managing Director NOTICE OF ANNUAL GENERAL MEETING 13

16 30 Annual Report To The Members M/s. Parenteral Drugs (India) Limited D I R E C TO R S ' R E P O R T The Directors of your Company have pleasure in presenting e 30 Annual Report togeer wi e performance of e company for e year ended 31 March, 2014: FINANCIAL RESULTS A summarized atement of e financial results of e current year and at of e previous year is given below: (` in Lacs) Standalone Consolidated DIRECTORS REPORT 14 PERFORMANCE REVIEW F.Y F.Y. F.Y Sales and Oer Income Profit/(Loss) before Intere, Depreciation & Tax ( ) ( ) ( ) Less: Finance co Depreciation and Amortization Provision for Taxation Deferred Tax Liability (407.99) Tax adjument for e previous - year Add: Profit on sale of undertaking Net Profit/(Loss) after tax ( ) ( ) ( ) ( ) Balance brought forward from ( ) ( ) previous year Add: Provision for Doubtful Advances Less: Amount transferred to Capital - - (550.00) - Redemption Reserve Surplus/(Deficit) ( ) ( ) ( ) ( ) Appropriations: Transferred to General Reserve Proposed Dividend Tax on Diributed Profit Minority Intere Balance carried to Balance Sheet ( ) ( ) ( ) ( ) Earning per share (EPS of Face Value of Rs. 10/-) F.Y (19.69) (32.94) (15.15) (41.69) The consolidated turnover for e year under review was Rs crores as compared to Rs crores in e previous year. The turnover on andalone basis ood Rs crores as again Rs crores in e previous year. On consolidated basis, e Company recorded a loss before intere, depreciation and tax of Rs crores during e year as again a loss of Rs crores in e previous year and recorded a loss before tax of Rs crores during e year as again a loss of Rs crores during e previous year.

17 Care, Concern and Cure... On andalone basis, e Company recorded a profit before intere, depreciation and tax of Rs crores during e year as again loss before intere, depreciation and tax of Rs crores in e previous year and recorded a loss before tax of Rs crores during e year as again a loss of Rs crores during e previous year. The loss was on account of increase in input co and extending extra heavy discounts to e cuomers to suain in e adverse liquidity crisis conditions. A review of e performance during e year is given under e section Management Discussion and Analysis Report which forms part of e Annual Report. DIVIDEND Due to continuous losses, e Board does not wish to recommend any dividend for e year under review. CORPORATE DEBT RESTRUCTURING Corporate Debt Reructuring Scheme, as framed by e Corporate Debt Reructuring Cell, Mumbai, on e recommendation of e Bankers of e Company, was implemented la year. CHANGES IN CAPITAL STRUCTURE Issue of shares on conversion of 0% Optionally Convertible Redeemable Preference Shares During e year, e company allotted 39,49,469 equity shares of Rs. 10/- each (including 9,87,367 bonus shares issued pursuant to e bonus issue brought in e financial year ) on e conversion of 29,62,102, 0% Optionally Convertible Redeemable Preference Shares to M/s. MVG Mercantile Private Limited, a promoter company on 30 October, 2013 which were due for conversion into equity shares or redemption on 1 November, 2013 on e expiry of five years from e date of allotment of e said 0% Optionally Convertible Redeemable Preference Shares to M/s. MVG Mercantile Private Limited. As a result of is, e issued, subscribed and paid-up equity shares increased from 25,86,68,310 shares to 2,98,16,300 shares as at 31 March, SUBSIDIARY COMPANIES As on e date of e report, e Company has eight (8) Indian and two (2) foreign subsidiaries viz: M/s. Goa Formulations Limited, M/s. Punjab Formulations Limited, M/s. Parentech Healcare Limited, M/s. Parenteral Surgicals Limited, M/s. Parenteral Biotech Limited, M/s. Parenteral Impex Limited, M/s. Abhay Drugs Limited and M/s. Anjaney Pharmaceuticals Limited. M/s. Mascareignes Pharmaceutical Manufacturing Limited and M/s. Parenteral Drugs Kazakhan are foreign subsidiaries. All e subsidiary companies are non-material and non-lied subsidiary companies as defined under clause 49 of e Liing Agreement wi e Stock Exchange(s). PARTICULARS UNDER SECTION 212 OF THE COMPANIES ACT, 1956 A atement pursuant to section 212 of e Companies Act, 1956, relating to subsidiary companies, is enclosed to e financial accounts of e company. In terms of general exemption, under section 212(8) of e Companies Act, 1956, granted by Miniry of Corporate Affairs vide its circular no. 02/2011 dated 8 February, 2011 and in compliance wi e conditions enlied erein, e Audited Statement of Accounts, Auditors' Report ereon and e Report of e Board of Directors of e subsidiary companies for e financial year ended 31 March, 2014, have not been annexed. The Annual Accounts and related documents of e subsidiary companies shall be kept open for inspection at e regiered office of e company. The company will also make available ese documents upon reque by any member of e company intereed in obtaining e same. Furer, pursuant to Accounting Standard (AS-21) issued by e Initute of Chartered Accountants of India, Consolidated Financial Statements presented by e Company in is Annual Report includes e financial information of its subsidiaries. DIRECTORS Shri Satish Moreshwar Joshi has resigned from e po of Nominee Director of e Company w.e.f. 30 June, Shri Govind Das Garg, Whole -Time Director is liable to retire by rotation at e forcoming Annual General Meeting and being eligible offers himself for re-appointment. Also, Shri Garg was re-appointed as Whole-Time Director of e company on 30 September, 2011 for a period of ree(3) years commencing from 1 January, 2012 and his tenure as Whole-Time Director is expiring on 31 December, The Nomination and Remuneration Committee and e Board DIRECTORS REPORT 15

18 30 Annual Report DIRECTORS REPORT of Directors of e company recommended his appointment at eir meeting held on 13 Augu, 2014 and 14 Augu, 2014, respectively. Considering e marginal losses in e company e Board has, on e recommendation of e Nomination and Remuneration Committee, reduced e overall remuneration payable to e Managerial Personnel. Also, according to clause 49 of e Liing Agreement and section 149 read wi Schedule IV of e Companies Act, 2013 e following Directors are appointed as Independent Directors on e Board of e company: 1. Shri Dilip Kumar Sinha 2. Shri Dharam Pal Khanna 3. Shri Dilip Kumar Panchaity 4. Shri Satish Chandra Consul Brief resume of ese Independent Directors, nature of eir expertise in specific functional areas and names of companies in which ey hold directorship / membership / chairmanship of Board / Committees as ipulated under clause 49 of e Liing Agreement wi e Stock Exchange(s), are provided in e Corporate Governance Report forming part of e Annual Report. REPORT ON CORPORATE GOVERNANCE Your Company believes Corporate Governance is at e core of Stakeholder satisfaction. Your Company is committed to maintain e highe andards of Corporate Governance and adhere to e Corporate Governance requirements set out by SEBI. Your Company has also implemented several be Corporate Governance practices as generally prevalent. The report on Corporate Governance as ipulated under clause 49 of e Liing Agreement forming part of e Annual Report. The requisite Certificate from e Practicing Chartered Accountant confirming compliance wi e conditions of Corporate Governance as ipulated under e aforesaid clause 49 is enclosed to is Report. The Disclosure as required in e Explanatory Statement for Item No. 9 of e Notice, regarding: (i) all elements of remuneration package such as salary, benefits, bonuses, ock options, pension, etc., of all e directors; (ii) details of fixed component and performance linked incentives along wi e performance criteria; (iii) service contracts, notice period, severance fees; (iv) ock option details, if any, and wheer e same has been issued at a discount as well as e period over which accrued and over which exercisable; are mentioned in report on Corporate Governance as ipulated under clause 49 of e Liing Agreement forming part of e Annual Report. MANAGEMENT DISCUSSION AND ANALYSIS REPORT The Management Discussion and Analysis Report on e operations of e Company, as required under e Liing Agreement wi e Stock Exchange(s) is provided as separate section and forms part of is Report. COMPLIANCE OFFICER Ms. Aradhana Kulkarni, a Fellow Member of e Initute of Company Secretaries of India was appointed as e Company Secretary and Compliance Officer of e Company w.e.f. 18 April, AUDITORS M/s. T.N. Unni & Co., Chartered Accountants, Statutory Auditors of e Company bearing Firm Regiration No C, retiring at e ensuing Annual General Meeting of e Company and proposed to be re-appointed as e atutory auditor of e Company from e conclusion of e ensuing Annual General Meeting till e conclusion of e next Annual General Meeting of e Company. As required under section 139 of e Companies Act, 2013 e Company has obtained a written consent from M/s. T.N. Unni & Co., Chartered Accountants, to such re-appointment and also a certificate to e effect at eir re-appointment, if made, would be in accordance wi section 139(1) and section 141 of e Companies Act, 2013 and rules made ere under, as may be applicable. 16

19 Care, Concern and Cure... AUDITORS' REPORT The report of e Statutory Auditors do not bear any qualification and e same is self explanatory and do not call for any furer comments from e Board. COST AUDIT Pursuant to e provisions of section 148 of e Companies Act, 2013 read wi Companies (Co Audit and Records) Rules, 2014, M/s. A. Goyal & Co., Co Accountants, Jaipur was appointed as Co Auditors of e Company, subject to e ratification of remuneration paid to e Co Auditor by e members of e company in respect of co audit of e Company's pharmaceutical products for e year ended 31 March, Report of e Co Auditor in respect of Co Audit for e year under review would be filed wi e Central Government in due course of time. SAFETY, HEALTH AND ENVIRONMENT Your Company's products and processes are developed in accordance wi rictly defined rules to ensure safety and heal of workers as well as e environment. HUMAN RESOURCE The Company believes in e concept of human empowerment. It firmly believes at human resource is e mo important asset of e organization and e same can be appreciably seen in e grow of e company in-spite of all odds. During e year, e company continued its efforts aimed at improving e human resource policies and processes to enhance its performance. During e year under review, e indurial relations continue to be cordial. INSURANCE All e assets of your company including buildings, machineries, fixtures and oer fixed assets, ocks, raw-materials, work in progress, finished goods, etc. have been adequately insured. FIXED DEPOSIT Your Company has not accepted any deposit from e public or its employees during e year under review and erefore, no amount on account of principal or intere on public deposits was outanding as on e date of e Balance Sheet. UNCLAIMED DIVIDEND The amount transferred by e Company in separate bank accounts towards payment to e shareholders is lying unclaimed in some cases. The shareholders, who have not claimed eir dividend up till now, are requeed to immediately approach e Regirar and Share Transfer Agent of e Company for claiming eir dividend. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS & OUTGO AND RESEARCH & DEVELOPMENT pertaining to e Conservation of Energy, Technology Absorption and Foreign Exchange Earnings & Outgo and Research & Development as prescribed under section 217(1)(e) of e Companies Act, 1956 read wi e Companies (Disclosure of in e Report of Board of Directors) Rules, 1988, are given in Annexure and e same is forming part of is Report. PARTICULARS OF EMPLOYEES During e year under review, none of e employees of e Company was in receipt of remuneration under section 217 (2A) of e Companies Act, LISTING The equity shares of e Company are lied on Bombay Stock Exchange and National Stock Exchange of India Limited. There are no arrears on account of payment of liing fees to e ock exchange(s). DIRECTORS REPORT 17