To,
The Members,
Your Directors have pleasure in presenting the 21st Annual
Report on the business and operations of the Company along with the audited financial
statements (Consolidated as well as Standalone) for the financial year ended March
31,2023.
1. Financial Summary of the Company
Particulars |
Standalone Rs. In Million |
Consolidated Rs. In Million |
|
2022-23 |
2021-22 |
2022-23 |
2021-22 |
Total Revenue |
11555.20 |
11,675.50 |
22235.50 |
16,710.85 |
Profit/(Loss) Before Interest and Depreciation |
3837.80 |
4,203.94 |
6298.83 |
5,360.33 |
Less: Finance Cost |
11.52 |
44.68 |
305.45 |
160.33 |
Less: Depreciation and amortization expenses |
452.95 |
449.22 |
1292.60 |
726.73 |
Profit before share of profit of Joint Venture and Tax |
3373.33 |
3,710.04 |
4700.78 |
4,473.43 |
Add: Share of Profit / (Loss) in Joint Venture |
|
|
0 |
95.10 |
Profit before Tax |
3373.33 |
3,710.04 |
4700.78 |
4,568.53 |
Fair value gain on acquisition of control |
|
|
148.29 |
|
Less: Income Tax |
|
|
|
|
- Current Tax |
837.62 |
909.27 |
1183.91 |
1141.55 |
- Deferred Tax Charge |
10.82 |
29.73 |
24.84 |
1.66 |
- Tax Pertaining to earlier years |
0 |
(12.63) |
(17.81) |
(12.63) |
Profit After Tax |
2524.89 |
2,783.67 |
3658.13 |
3,437.95 |
Add: Other Comprehensive Income |
8.23 |
1.97 |
8.51 |
1.20 |
Total Comprehensive Income |
2533.12 |
2,785.64 |
3666.64 |
3,439.15 |
2. Results of operations/state of company?s affair
During the year under review, the total revenue on standalone basis
decreased by 1.03% to Rs. 11,555.20 million in FY23 compared to Rs. 11,675.50 million in
the previous year. The profit after tax for the year decreased by 9.30% to 2,524.89
million compared to Rs. 27,83.67 million in the previous year.
During the year under review, the consolidated total revenue of the
Company increased by 33.06% to Rs. 22,235.50 million compared to Rs. 16,710.85 million.
Profit after tax for the group increased by 6.40% to Rs. 3658.13 million compared to Rs.
3,437.95 million in the previous year.
3. Consolidated Financial Statements
In accordance with Companies Act, 2013 ("the Act") and Ind AS
110 - Consolidated Financial Statements read with Ind AS 28 - Investment in Associates and
Joint ventures, the audited consolidated financial statements form part of the Annual
Report.
In terms of provision to sub section (3) of Section 129 of the Act, the
salient features of the financial statements of the Subsidiaries and Associates are set
out in the prescribed Form AOC-1, which forms a part of the Annual Report.
In accordance with Section 136 of the Act, the audited financial
statements, including the consolidated financial statements of the Company and audited
accounts of the subsidiaries are available at the Company?s website:
https://www.kimshospitals. com/investors/. The documents will also be available for
inspection during business hours at the registered office of the Company.
4. Change in the nature of the business, if any:
There was no change in the nature of Business during the year.
5. Dividend
As the Company, is undertaking multiple semi brownfield projects (i.e.
Nashik, Bangalore, Mumbai etc), for better long term value creation to shareholders, the
Company is not declaring any dividend for the Financial Year 2022-23.
6. Transfer of Reserves
The Company has recorded a profit of Rs. 2533.12 million (Standalone)
for the period 2022-23 and the same was transferred to the head of other Equity.
7. Share Capital
The paid up share capital as on March 31,2023 is Rs. 80,02,77,870.
During the year under review, the Company has not issued shares with
differential voting rights nor granted stock options nor sweat equity. As of March 31,
2023, the details of shareholding in the Company held by the Directors are set out in the
Corporate Governance Report forming part of the Board?s Report and none of the
directors hold convertible instruments of the Company.
8. Directors and Key Managerial Personnel
Composition of the Board: The Board of Directors ("the
Board") of the Company consists of an optimal combination of Executive, Non-Executive
and Independent Directors which represent a mix of professionalism, knowledge and
experience. The Board brings in the guidance, leadership and an independent view to the
Company?s management while discharging its fiduciary responsibilities, thereby
ensuring that management adheres to the ethics, transparency and disclosure norms.
As on date of this report, the Board comprises of 10 (Ten) Directors,
of whom, 3 (Three) are Executive Director and 7 (Seven) are Non-Executive Directors.
Amongst the Non-Executive Directors, 6 (Six) are Independent Directors and 1 (one) is Non-
Independent Director. The Non-Executive Directors bring an external and wider perspective
in Board?s deliberations and decisions. The size and composition of the Board
conforms to the requirements of the Companies Act, 2013.
Independent Directors
Your Independent Directors fulfill all the conditions for being
Independent to the Company, as stipulated under the Companies Act, 2013. All Independent
Directors have given the declaration that they meet the criteria of Independence as laid
down under section 149(6) of the Companies Act, 2013.
The Board is of the opinion that the above Independent Directors
possess requisite integrity, experience and expertise (including the proficiency).
Key Managerial Personnel and Change in Directors during the year
a) The Company has Re-Appointed Dr. Bhaskara Rao, as Chairman cum
Managing Director for further period of Five (5) years w.e.f. 1st April, 2022 vide Board
of Directors Meeting held on 10th January, 2022 and obtained the shareholders?
approval on 11th June, 2022 through postal ballot.
b) The Company has Re-Appointed Ms. Dandamudi Anitha as a Whole-time
Director for further period of Five (5) years w.e.f. 01st April, 2022 vide Board of
Directors Meeting held on 10th January, 2022 and obtained the shareholders? approval
on 11th June, 2022 through postal ballot.
c) The Company has Re-Appointed Dr. Abhinay Bollineni as an Executive
Director & CEO for further period of Five (5) years w.e.f. 18th January, 2022 vide
Board of Directors Meeting held on 10th January, 2022 and obtained the shareholders?
approval on 11th June, 2022 through postal ballot.
d) The Company has appointed Mrs. Y. Prameela Rani (DIN No. 03270909)
as Additional Director - (Non-Executive, Independent Director) for a period of Three (3)
years in the Board of Directors Meeting held on 19th May, 2022, Subsequently obtained the
Shareholders approval in 20th Annual General Meeting held on 11th August, 2022.
e) Mr. Shantanu Rastogi (DIN: 06732021), Non-Executive Director
(Nominee Director of General Atlantic Singapore KH. Pte. Ltd) has resigned from the board
on 08th December, 2022 and re-appointed as Non- Executive Director of the Company w.e.f.
10th December, 2022 vide circular resolutions dated 08th December, 2022 and 12th December,
2022 respectively, Subsequently obtained the Shareholders approval for his re-appointment
through Postal ballot on 12th February, 2023.
Retirement by Rotation
Pursuant to Section 152 of the Companies Act 2013, Ms. Dandamudi
Anitha, Whole-time Director retires by rotation at the ensuing Annual General Meeting and
being eligible offers herself for re-appointment.
9. Board Functioning & Meetings
The Board and Committee meetings are pre-scheduled and a tentative
calendar of the meetings shall be finalized in consultation with the Directors to
facilitate them to plan their schedule. However, in case of urgent business needs,
approval is taken by passing resolutions through circulation. During the year under
review, 9 (Nine) board meetings were held. The intervening gap between the Meetings was
within the period prescribed under the Companies Act, 2013.
The details of the meetings including the composition of various
committees are provided in the Corporate Governance Report.
10. Nomination and Remuneration Policy
The Board has, on the recommendation of the Nomination &
Remuneration Committee, approved a policy for selection and appointment of Directors,
Senior Management and their remuneration. The Remuneration Policy is stated in the
Corporate Governance Report.
11. Annual Return
As required pursuant to section 92(3) of the Companies Act, 2013 and
rule 12(1) of the Companies (Management and Administration) Rules, 2014, Annual Return is
uploaded on the website of the Company at https://www.kimshospitals.com/investors/.
12. Details of Subsidiary/Joint Ventures/Associate Companies
a. Arunodaya Hospitals Private Limited (Subsidiary Company): The
subsidiary company has recorded a total revenue of Rs.365.56 million during the financial
year 2022-23.
b. KIMS Hospital Enterprises Private Limited (Subsidiary Company): The
subsidiary company has recorded a total revenue of Rs. 2528.72 million during the
financial year 2022-23.
c. Iconkrishi Institute of Medical Sciences Private Limited (Subsidiary
Company): The subsidiary company has recorded a total revenue of Rs. 1078.39 million
during the financial year 2022-23.
d. Saveera Institute of Medical Sciences Private Limited (Subsidiary
Company): The subsidiary company has recorded a total revenue of Rs. 942.43 million during
the financial year 2022-23.
e. KIMS Hospital Kurnool Private Limited (Subsidiary Company): The
subsidiary company has recorded a total revenue of Rs. 715.18 million during the financial
year 2022-23.
f. Sarvejana Healthcare Private Limited (Subsidiary Company): This
Company became a Subsidiary of the Company on 01st April 2022.The Subsidiary company has
recorded a total revenue of Rs. 2883.19 million during the financial year 2022-23.
g. Rajyalakshmi Healthcare Private Limited (Step down Subsidiary): This
is the Subsidiary of Sarvajana Heathcare Private Limited. It has recorded a total revenue
of Rs. 1401.28 million during the financial year 2022-23.
h. SPANV Medisearch Lifesciences Private Limited (Subsidiary Company):
This Company has become the Subsidiary of your Company on 01.09.2022. It has recorded a
total revenue of Rs. 883.62 million during the financial year 2022-23.
i. KIMS Hospitals Private Limited., KIMS Swastha Private Limited, and
KIMS Hospital Bengaluru Private Limited (formerly known as KIMS Hospital (Bhubaneswar)
Private Limited, KIMS Manavata Hospitals Private Limited. This are the subsidiaries of
your Company, which are still under the process of setting up its infrastructure to run
the hospital.
j. Suryateja Healthcare Private Limited (Step down Subsidiary): During
the year under review the Company ceases to be step down subsidiary of the Company w.e.f.
December 01,2022 as the Company was sold.
The information on subsidiary Companies pursuant to Section 129(3) of
the Act read with rule 5 of the Companies (Accounts) Rules, 2014 is annexed herewith as
ANNEXURE -1 in Form AOC -1.
13. Particulars of contracts or arrangements with related parties.
All contracts/arrangements/transactions entered by the Company during
the financial year with related parties were in the ordinary course of business and on an
arm?s length basis. During the year, the Company had not entered into any
contract/arrangement/ transaction with related parties which could be considered material
in accordance with the policy of the Company on the materiality of related party
transactions. The disclosure pursuant to Clause (h) of Sub Section (3) of Section 134 of
the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014) as required
is enclosed as ANNEXURE-II.
The Policy on materiality of related party transactions and dealing
with related party transactions as approved by the Board may be accessed on the
Company?s website https://www.kimshospitals.com/investors/ . Your Directors draw the
attention of the members to the Notes to the financial statements which sets out related
party disclosures.
None of the Directors have any pecuniary relationships or transactions
vis-a-vis the Company except Dr. Bhaskara Rao Bollineni, Chairman & Managing Director
who has drawn a professional fee of Rs. 17.23 million for the Financial year 2022- 23.
14. Auditors
In the 17th Annual General Meeting, S. R. Batliboi & Associates LLP
(having Registration Number: 101049W/ E300004) Chartered Accountants were appointed as
Auditors of the Company for the term of 5 years i. e. from the conclusion of 17th AGM to
the conclusion of 22nd AGM.
15. Cost Auditors
Pursuant to Section 148 of the Companies Act, 2013 read with the
Companies (Cost Records and Audit) Amendment Rules, 2014, the Directors on the
recommendation of the Audit Committee, appointed M/s. Sagar & Associates, Cost
Accountants, Hyderabad (FRN 000118) to audit the cost accounts of the Company for the
financial year 2023-2024 on a remuneration of Rs. 6.00 Lakhs.
As required under the Companies Act, 2013, the remuneration payable to
the cost auditor is required to be placed before the Members in a general meeting for
their ratification. Accordingly, a resolution seeking Member?s ratification for the
remuneration payable to M/s. Sagar & Associates, Cost Accountants, Hyderabad (FRN
000118) will be part of Notice convening the 21st Annual General Meeting.
The Company has maintained cost records in accordance with the
provisions of the Companies Act, 2013 read with the Companies (Cost Records and Audit)
Amendment Rules, 2014 in respect of healthcare services.
16. Adequacy of Internal Financial Controls:
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 (IA) function is defined
in the Internal Audit Charter. To maintain its objectivity and independence, the Internal
Audit function reports to the Chairman of the Audit Committee of the Board. The details of
the internal control system and its terms of reference are set out in the Management
Discussion and Analysis Report forming part of the Board?s Report.
The Board of Directors has laid down internal financial controls to be
followed by the Company and the policies and procedures to be adopted by the Company for
ensuring the orderly and efficient conduct of its business, including adherence to the
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 Audit Committee evaluates the internal
financial control systems periodically.
17. Statutory Auditors Report and Secretarial Auditors Report
The Directors hereby confirm that the Statutory Auditors and
Secretarial Auditors have reported that there are no qualification, reservation, adverse
remark or any frauds made by the company in their respective audit reports for the year
ended March 31,2023.
18. Secretarial Audit Report
In terms of Section 204 of the Act and Rules made there under, M/s IKR
& Associates Practicing Company Secretary has been appointed as Secretarial Auditor of
the Company. The report of the Secretarial Auditors is enclosed as ANNEXURE - III to this
report. The report is self-explanatory and do not call for any comments.
In terms of Regulation 24A of Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 the material unlisted
subsidiaries incorporated in India shall undertake secretarial audit and shall annex a
secretarial audit report given by a company secretary in practice. In this regard the
Secretarial Audit report of KIMS Hospital Enterprises Private Limited, material subsidiary
company is enclosed as ANNEXURE - IV to this report.
19. Vigil Mechanism/Whistle Blower Policy
The Company has established a vigil mechanism for Directors and
Employees to report their genuine concerns, the details of which are given in the
Corporate Governance Report. The policy on Vigil Mechanism and Whistle Blower Policy has
been posted on the website of the Company https://www.kimshospitals.com/investors/.
20. Dividend Distribution Policy:
The said Dividend Distribution policy is placed on the website of the
Company https://www.kimshospitals.com/investors/.
21. Performance Evaluation of the Board and the Directors
Pursuant to the provisions of the Companies Act, 2013 and in terms of
Regulation 17(10) of the SEBI Listing Regulations, the Board has carried out an annual
performance evaluation of the directors individually, Board, Chairperson and Committees.
The manner in which the evaluation has been carried out has been explained in the
Corporate Governance Report.
22. Risk Assessment and Minimization
The Board of Directors had constituted a Risk Management Committee to
identify elements of risk in different areas of operations and to develop a policy for
actions associated to mitigate the risks. The Committee on a timely basis informed the
members of the Board of Directors about risk assessment and minimization procedures and in
the opinion of the Committee there was no risk that may threaten the existence of the
Company. The details of the Risk Management Committee are included in the Corporate
Governance Report.
23. Material changes and commitments, if any, affecting the financial
position of the company which have occurred between the end of the financial year of the
company to which the financial statements relate and the date of the report.
There are no material changes and commitments affecting the financial
position of the Company that have occurred between the end of the financial year of the
Company to which the financial statements relate and the date of the report i.e. between
March 31,2022 to March 31,2023.
24. Details of significant and material orders passed by the regulators
or courts or tribunals impacting the going concern status and company?s operations in
future.
There are no significant and material orders passed by the regulators
or courts or tribunals impacting the going concern status and companies operations in
future.
25. The details of application made or any proceeding pending under the
Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status
as at the end of the financial year:
There are no applications made or pending under the Insolvency and
Bankruptcy Code, 2016 during the year under review.
26. The details of difference between amount of the valuation done at
the time of one-time settlement and the valuation done while taking loan from the Banks or
Financial Institutions along with the reasons thereof:
Not Applicable, as Company has not done any one-time settlement during
the year under review.
27. Deposits
Your Company has not accepted any deposits from the public covered
under Chapter V of the Act, during the year under review.
28. Particulars of loans, guarantees or investments under section 186
The details of loans, guarantees and investments covered under the
provisions of section 186 of the Companies Act, 2013 are given in the notes to the
financial statements.
29. Particulars of employees and related disclosures
The information under Section 197 of the Act read with Rule 5 of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
In terms of the provisions of Section 197(12) of the Act read with
Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, as amended, a statement showing the names and other particulars of
the employees drawing remuneration in excess of the limits set out in the said rules are
provided in the Annual Report, which forms part of this Report.
Disclosures relating to remuneration and other details as required
under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014 are also provided in the Annual Report,
which forms part of this Report.
Having regard to the provisions of Section 136(1) read with the
relevant provisions of the Companies Act, 2013, the Annual Report excluding the aforesaid
information is being sent to the members of the Company. The said information is available
for inspection at the Registered Office of the Company during working hours. Any member
interested in obtaining such information may write to the Company Secretary and the same
will be furnished free of cost.
30. Corporate Governance
The Company is committed to maintain the highest standards of corporate
governance and adhere to the corporate governance requirements set out by SEBI. The report
on corporate governance as required under the Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter Listing
Regulations), forms an integral part of this report. The requisite certificate from M/s
IKR & Associates, Practicing Company Secretaries confirming the compliance with the
conditions of corporate governance is attached to the report on Corporate Governance.
31. Management Discussion and Analysis Report
Management Discussion and Analysis Report for the year under review, as
stipulated under Regulation 34 of the Listing Regulations is presented in a separate
section forming part of the Annual Report.
32. Business Responsibility and Sustainability Report (BRSR)
As stipulated under the Listing Regulations, the Business
Responsibility and Sustainability Report describing the initiatives taken by the Company
from an environmental, social and governance perspective is attached as part of the Annual
Report.
33. Conservation of energy, technology absorption and foreign exchange
earnings and outgo
The details of conservation of energy, technology absorption, foreign
exchange earnings and outgo are as follows:
a) Conservation of energy
Particulars required under section 134(3) of the Companies Act, 2013
read with Companies (accounts) Rules, 2014 is not applicable as the Company is not energy
conservative; however your company is taking necessary steps to save the energy.
b) Technology Absorption
Over the years, your Company has brought into the country the best that
the world has to offer in terms of technology.
In its continuous endeavor to serve the patients better and to bring
healthcare of international standards, your Company has introduced the latest technology
in its hospitals.
c) Foreign exchange earnings and Outgo
Your Company did not have any long term contracts including derivative
contracts for which there were any material foreseeable losses. Your Company does not have
any unhedged foreign currency exposure as at March 31,2023.
Foreign Exchange Earnings : Rs. 108.82 Million Foreign Exchange Outgo :
13.60 Million
34. Corporate Social Responsibility (CSR)
As per the Provisions of Section 135 of the Companies Act, 2013 read
with Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014, the
Corporate Social Responsibility (CSR) committee has been formed by the company. The
Committee has approved the CSR which is stated in the Corporate Governance Report.
As part of its initiatives under Corporate Social Responsibility (CSR),
the Company has undertaken projects in the areas of Rural Development, Healthcare,
Education & Skill Development and Research in Healthcare. These projects are in
accordance with Schedule VII of the Companies Act, 2013. The Report on CSR activities for
the financial year 2022-2023 is annexed herewith as "ANNEXURE V".
35. Human Resources
Your Company treats its "human resources" as one of its most
important assets. Your Company continuously invests in attracting, retention and
development of talent on an ongoing basis. A number of programs that provide focused
people attention are currently underway.
36. Compliance with Secretarial Standards
During the year under review, the Company has duly complied with the
applicable provisions of the Revised Secretarial Standards on Meetings of the Board of
Directors (SS-1) and General Meetings (SS-2) issued by the Institute of Company
Secretaries of India (ICSI).
37. Obligation of company under the Sexual Harassment of Women at
Workplace (prevention, prohibition and redressal) Act, 2013.
In order to prevent sexual harassment of women at work place a new act,
The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act,
2013 has been notified on 9th December, 2013. Under the said Act every company is required
to set up an Internal Complaints Committee to look into complaints relating to sexual
harassment at work place of any women employee.
Company has adopted a policy for prevention of Sexual Harassment of
Women at workplace and has set up Committee for implementation of said policy. During the
year Company has received Nil complaints.
38. Directors? Responsibility Statement
The Directors? Responsibility Statement referred to in clause (c)
of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that:
a) In preparation of the annual financial statement for the year ended
March 31, 2023, applicable accounting standards had been followed along with proper
explanation relating to material departures if any;
b) Such accounting policies have been selected 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 as of March 31,2023, and
of the profit of the Company for the year ended on that date;
c) Proper and sufficient care has been taken in the maintenance of
adequate accounting records in accordance with the provisions of the Companies Act 2013
for safeguarding the assets of the company and for preventing and detecting fraud and
other irregularities;
d) The annual accounts have been prepared on a going concern basis;
e) Based on the framework of internal financial controls and compliance
systems established and maintained by the Company, work performed by the internal,
statutory, and secretarial auditors and external consultants, including audit of internal
financial controls over financial reporting by the statutory auditors and the reviews
performed by management and the relevant Board Committees, including the Audit, Risk
Management Committee, the Board is of the opinion that proper internal financial controls
are in place and such internal financial controls are adequate and are operating
effectively.
f) Proper systems have been devised to ensure compliance with the
provisions of all applicable laws and such systems are adequate and are operating
effectively;
39. Transfer of Amounts to Investor Education and Protection Fund
Your Company did not have any funds lying unpaid or unclaimed for a
period of seven years. Therefore there were no funds which were required to be transferred
to Investor Education and Protection Fund (IEPF).
40. Acknowledgment
Your Directors place on record their gratitude to the Central
Government, State Governments and all other Government agencies for the assistance,
co-operation and encouragement they have extended to the Company.
Your Directors also take this opportunity to extend a special thanks to
the medical fraternity and patients for their continued cooperation, patronage and trust
reposed in the Company. Your Directors also greatly appreciate the commitment and
dedication of all the employees at all levels, that has contributed to the growth and
success of the Company.
Your Directors also thank all the strategic partners, business
associates, Banks, financial institutions and other stakeholders including the
shareholders for their assistance, co-operation and encouragement to the Company during
the year.
|
For and on behalf of the Board of Directors of Krishna
Institute of Medical Sciences Limited |
|
Place: Hyderabad |
Dr. Bhaskara Rao Bollineni |
Dr. Abhinay Bollineni |
Date: 18.05.2023 |
Chairman & Managing Director (DIN No.00008985) |
Director & CEO (DIN No.01681273) |
|