Kerala Ayurveda Ltd.. M C Mohan, Independent Director (DIN 00633439) Mr. S Krishnamurthy, Independent Director (DIN 00140414) Mr. Kshiti Ranjan Das, Independent Director (DIN 07212449)

Kerala Ayurveda Ltd.

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CORPORATE INFORMATION

C O N T E N T S

BOARD OF DIRECTORS Mr. Ramesh Vangal, Chairman (DIN 00064018)

(Current Directors) Mr. Gokul Patnaik, Vice Chairman (DIN 00027915)

Dr. K Anilkumar, Whole Time Director (DIN 00226353)

Mr. M C Mohan, Independent Director (DIN 00633439)

Mr. S Krishnamurthy, Independent Director (DIN 00140414)

Mr. Kshiti Ranjan Das, Independent Director (DIN 07212449)

Mr. Anand Subramanian, Additional Director (DIN 00064083)

CHIEF FINANCIAL OFFICER Mr. Arvind Agarwal

COMPANY SECRETARY Mr. K.Raghunadhan

REGISTERED OFFICE & FACTORY VII/415, Nedumbassery, Athani P.O, Aluva-683 585, Kerala, IndiaCIN: [email protected] www.keralaayurveda.biz / investor-relationships

CORPORATE OFFICE No.1134, 1st Floor, 100 Ft Road, HAL 2nd Stage, Indiranagar, Bengaluru – 560 008

STATUTORY AUDITORS M/s. Biju George & Co.Chartered AccountantsVellaringattu Towers, Thodupuzha – 685 584

SECRETARIAL AUDITORS M/s. SVJS & Associates, Company Secretariesst39/3519 B, 1 Floor, Padmam Apartments,

Manikkath Road, Ravipuram, Kochi – 682 016

INTERNAL AUDITORS Mr. Mathew Joseph, Chartered Accountant 32/2431, Kunnath Lane, S N Junction, Palarivattom Kochi-682 025

BANKERS Kotak Mahindra Bank Ltd

REGISTRAR & TRANSFER AGENTS M/s. Integrated Registry Management Services Pvt. Ltd.,Kences Towers, No.1 Ramakrishna Street T Nagar, Chennai - 600 017 Ph: 044-28140801-03 Fax: 044-28142479 E-mail : [email protected]

Chairman's Statement 2 I

Notice of AGM 3 Standalone Financials & Notes 53

Directors' Report 11 Independent Auditors' Report on Consolidated Financials 66

Report on Corporate Governance 35 Consolidated Financials & Notes 70

Management Discussion & Analysis Report 47 Attendance slip, Proxy Form and Route Map 85

ndependent Auditors' Report on Standalone financials 49


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CHAIRMAN’S STATEMENT

Dear Shareholders,

India can be a leader in making affordable, holistic healthcare available to the world and the Government of India is fully committed for promotion of Ayurveda, Yoga and traditional systems of medicine, and backed by our Hon'ble Prime Minister Shri. Narendra Modi.

Kerala Ayurveda Limited has set itself to lead the industry into bringing Ayurvedic solutions, which is in line with the Indian Government's Vision to Take Ayurveda Global. Its tradition comes from an ancient authentic Kerala Ayurveda tradition, with an integrated spectrum of Products, Services and Education. Each of these business units are significantly established commercially via independent platforms with a strong proof of concept, capable of explosive growth. These are independent scalable models which combine together to form an integrated and cohesive spectrum of wellness.

We are thrilled at the recognitions awarded to us, with the recent one being the prestigious India Today “Make

in India Emerging Entrepreneur Award”, 2017 under Pharmaceuticals & Biotechnology Category, awarded in July 2017. This recognition from India Today reinforces our commitment to 'Take Ayurveda Global' and by leveraging the India arbitrage 'From India', and 'For India'. We have over a dozen exciting Ayurvedic Cross-

over products ready for launch, to benefit customers, which are going to be marketed through pharma. This award encourages us to lead the industry into bringing Innovative Ayurvedic solutions.

The past year has also been an exciting and eventful year for us. Our excellence in delivering quality products and Healthcare services has earned us the prestigious ASSOCHAM awards for Kerala Ayurveda Ltd. as

'HERBAL COMPANY OF THE YEAR' and Ayurvedagram Heritage Wellness Centre Pvt. Ltd. (subsidiary) as 'SPA & WELLNESS CENTRE OF THE YEAR 2016' and 'Best Ayurvedic Treatment Centre of the Year

2017'. These recent awards have given us confidence to build an all India therapy network of clinics and hospitals. Kerala Ayurveda Ltd. is all set to tap the potential of growing medical tourism in India and be a major player by offering the authentic ayurvedic treatments from Kerala. On the education front, Kerala Ayurveda Ltd. has been the foremost Ayurveda Education School in the USA and also a branch in Kerala, India. The US centre has trained around 2000 students through 625 hrs - 1500 hr programs called AWC and AWP. These programs allow certification and accreditation by the California and Washington State Government. In addition Kerala Ayurveda Limited runs numerous Seminars and workshops around the country.

Kerala Ayurveda Ltd. is poised for growth. We are well positioned to expand the reach of Ayurveda, given the large amount of scientific knowledge and practical experience of treating more than 70,000 patients a year, through our network of clinics, hospitals & resorts and academies in India and abroad. With its unique platforms and as a group we are in the endeavour of –

ØBuilding a “Global Wellness Brand Engine”,

ØEstablish an Ayurvedic Footprint Globally and

ØDeliver Affordable Health

Our core business idea is a fully integrated approach that combines traditional wisdom and modern scientific knowledge that delivers Ayurvedic solutions that are Pure, Safe and Effective. In summary dear shareholder, we are aware that your company growth has been modest over the past few years. However we now have a strong business foundation with business platforms which are scalable rapidly. We can expect to see rapid growth in the years ahead!

Bengaluru Ramesh Vangal th11 August, 2017 Chairman


NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Twenty Fifth Annual General Meeting of the Members of Kerala Ayurveda Limited (CIN: th L24233KL1992PLC006592) will be held on Wednesday, the 27 September, 2017 at 3.30 p.m. at Green Park

Auditorium, N.H. 47, Desom, Aluva-683 103, Kerala, to transact the following business:

ORDINARY BUSINESS

1. To receive, consider and adopt the Audited Financial Statements (including consolidatedst financial statements) of the company for the Financial Year ended 31 March, 2017 together with the Reports of the

Board of Directors and Auditors thereon.

2. To appoint a Director in place of Mr. Ramesh Vangal, (DIN 00064018) who retires by rotation and being eligible, offers himself for re-appointment.

3. To ratify the appointment of M/s. Biju George & Co, Chartered Accountants as Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the next annual General Meeting and to authorize the Board to fix their remuneration.

SPECIAL BUSINESS

4. To consider and, if thought fit, to pass with or without modification(s) the following resolution as an

Ordinary Resolution.

“RESOLVED THAT pursuant to the provisions of Section 152,161 and other applicable provisions of the Companies Act, 2013 and the Rules made there under (including any statutory modification(s) or re-enactment thereof for the time being in force) Mr. Anand Subramanian, (DIN:00064083) who was appointed as an Additional Director at

ththe meeting of the Board of Directors of the company held on 29 September, 2016 and who holds office up to the date of this Annual General Meeting and in respect of whom the company has received a notice in writing under Section 160 of the Companies Act, 2013 from a member proposing his candidature for the office of the Director, be and is hereby appointed as a Director of the company, liable to retire by rotation.”

5. To consider and if thought fit, to pass with or without modification the following resolution as a

Special Resolution.

“RESOLVED THAT pursuant to the provisions of Section 188 and all other applicable provisions if any of the Companies Act, 2013 (the Act) read with the Companies (Meeting of the Board and its powers) Rules, 2014 and read with Clause 23(4) of the SEBI(LODR) Regulations, 2015 and subject to such approvals, consents, sanctions and permission as may be necessary, consent of the members of the Company be and is hereby accorded to the Board of Directors to enter into an agreement with M/s. Ayurvedagram Heritage Wellness Centre Pvt. Ltd. for the sale of medicines upto ̀ 500 lacs during the period 01.04.2017 to 31.03.2020 with a discount upto 15% on MRP as resolved

thby the Board of Directors in its meeting held on 11 August, 2017 being beneficial to the company.”

6. To consider and, if thought fit, to pass with or without modifications, the following resolution as a

Special Resolution.

“RESOLVED THAT in supersession of the resolution passed by the shareholders in the Annual General Meeting held on 29thSeptember,2015, the consent of the Company be and is hereby accorded under the provisions of Section 180 (1) (c) of the Companies Act, 2013, to the Board of Directors of the company for borrowing monies, from time to time, at its discretion either from the Company's Bankers or any other banks, financial institutions, international lending agencies or any other lending institutions, persons, firms, trusts or bodies corporate by way of deposits,

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KERALA AYURVEDA LTDCIN : L24233KL1992PLC006592

Regd.Off: VII/415, Nedumbassery Athani P O, Aluva 683 585Ph: 0484-2476301(4 lines) Fax: 0484-2474376

Email: [email protected] Website: www.keralaayurveda.biz


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advances or other loans, convertible/non convertible debentures, commercial papers, bonds or any other debt instruments, whether unsecured or secured directly by mortgage, charge, hypothecation or pledge of any of the Company's assets and properties, book debts or by collateral security thereon or on such terms and conditions as may be considered suitable by the Board of Directors, even though the monies to be borrowed together with monies already borrowed by the Company, apart from temporary loans from Company's Bankers in the ordinary course of business, exceeds the aggregate paid up capital of the Company and its free reserves, ie. reserves not set apart for any specific purpose, provided however, that the total amount of sum borrowed shall not exceed the amount of ` 100 crores (Rupees hundred crores) at any time.”

RESOLVED FURTHER THAT the Board of Directors of the company be and is hereby authorized to do all such acts, deeds, matters and things as it may be necessary and expedient and also to delegate all or any of the above powers to the Directors or any other officers of the company for giving effect to the above resolution.”

By order of the Board of Directors

For Kerala Ayurveda Limited

K.Raghunadhan

Company Secretary

Important Notes:

1. The Explanatory Statements pursuant to Section 102(1) and (2) of the Companies Act, 2013 in respect special

Business in item No.4, 5 and 6 are annexed hereto.rd th2. Register of members will remain closed from Saturday, 23 September, 2017 to Wednesday, 27 September,

2017 (both days inclusive).

3. Route map of the Venue is attached as annexure to this Report. (Page No.87)

4. A member entitled to attend and vote is entitled to appoint a proxy to attend and vote instead of

himself/herself and the proxy need not be a member of the company. A person can act as a proxy on behalf of not

more than fifty (50) members and holding in aggregate not more than ten percent of the total Share Capital of the

Company. Members holding more than ten percent of the total Share Capital of the Company may appoint a single

person as proxy, who shall not act as a proxy for any other Member. The instrument appointing a proxy as per the

format given at the end of this annual report to be effective must be received by the Company, not less than 48

hours before the commencement of the meeting. Proxies submitted on behalf of the companies, societies etc. must

be supported by an appropriate resolution/authority, as applicable. A proxy form is annexed to this report.

5. Members holding shares in electronic form should get their email ids updated with their respective Depository

Participant so that they can get the copies of correspondence etc., sent by the Company via email.

6. Copies of the Annual Report 2016-17 are being sent by Electronic Mode to all the members whose email ID's are

registered with the company/Depository Participant(s) for communication purpose unless any member has requested

for a hard copy of the same. For members who have not registered their email address, physical copies of the Annual

Report 2016-17 are being sent by the permitted mode.th7. Electronic copy of the 25 Annual General Meeting of the company inter alia indicating the process and manner

of e-voting along with Attendance Slip and Proxy Form is being sent to all the members whose email ID's are

registered with the Company/Depository Participant(s) for communication purposes unless any member has

requested a hard copy of the same . For other members physical copies of the Notice indicating the process and

manner of e-voting along with Attendance Slip and Proxy Form are being sent by the permitted mode. Annual report will

also be available on the Company's website www.keralaayurveda.biz under “Investor Section” for their download. The

Place: BengaluruthDate :11 August, 2017


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physical copies of the aforesaid documents will also be available at the Company's Registered Office for inspection

during normal business hours on working day. Even after registering for e-communications, members are entitled to

receive such communication in physical form, upon making a request for the same by post free of cost. For any

communication, the shareholders may also send requests to the Company's investor email ID:

[email protected].

8. Members who are holding physical shares in identical order of names in more than one folio are requested to send

to the Company or Company's Share Transfer Agent the details of such folios together with the share certificates for

consolidating their holding in one folio. The share certificates will be returned to the members after making requisite

changes, thereon. Members are requested to use the new share transfer Form SH-4.

9. Members holding shares in single name and physical form are advised to make nomination in respect of their

shareholding in the Company. The Nomination Form SH-13 prescribed by the Government can be obtained from the

Registrar and Transfer Agent or the Secretarial Department of the Company at its Registered Office.

10. Members are requested to send their correspondence/queries to the Share Transfer Agents, M/s. Integrated

Registry Management Services Pvt. Ltd., having office at Kences Towers, 2nd Floor, No.1 Ramakrishna Street, Off

North Usman Road, T Nagar, Chennai 600 017, Ph: 044-28140801 to 03 Fax: 044-28142479, E-mail:

[email protected] with a copy to the company's registered office and quote their folio number/client ID

number.

11. Members holding shares in physical form are requested to notify any change in their address to the Company's

Registrar & Share Transfer Agent. Members holding shares in electronic form are requested to intimate the changes, if

any, in their address to respective depository participants only.

12. Shareholders intending to make queries at the AGM on any aspect of the working of the company, on the

published accounts or on the Directors' Report may write to The Company Secretary, Kerala Ayurveda Ltd, VII/415, rdNedumbassery, Athani P.O., Aluva-683 585 so as to reach it latest by 23 September, 2017.

13. The form of attendance slip is attached with this notice. Shareholders are requested to produce duly filled

Attendance Slip for verification at the meeting. Members/proxies are requested to bring their copy of the Annual

Report 2016-17 to the AGM.

14. The registration at AGM venue shall be strictly open only upto the time AGM starts. Shareholders are requested to

be present before AGM time.

15. VOTING THROUGH ELECTRONIC MEANS

In compliance with the provisions of Section 108 of the Companies Act, 2013 read with Rule 20 of the Companies

(Management and Administration) Rules, 2014 as amended and Regulation 44 of the SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015 the Company is pleased to provide members facility to exercise their th right to vote at the 25 Annual General Meeting (AGM) by electronic means and the business may be transacted

through e voting services provided by Central Depository Services (India) Ltd (CDSL). E-Voting is optional and

members shall have the option to vote either through e-voting or in person at the general meeting. The facility of casting

the votes by the members using an electronic voting system from a place other than venue of the AGM (“remote e-

voting”) will be provided by CDSL.

The facility for voting through ballot paper shall be made available at the AGM and the members attending the meeting who have not cast their vote by e-voting shall be able to exercise their right at the meeting through ballot paper.

The members who have cast their vote by e-voting prior to AGM may also attend the AGM but shall not be entitled to cast their vote again.


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16. THE PROCESS AND INSTRUCTIONS FOR E-VOTING ARE AS UNDER:-

A. In case of members receiving e-mail:

1. Shareholders who have already voted prior to the meeting date would not be entitled to vote at the meeting venue.

2. The shareholders should log on to the e-voting website www.evotingindia.com.

3. Click on Shareholders.

4. Now Enter your User ID

5. For CDSL: 16 digits beneficiary ID,

6. For NSDL: 8 Character DP ID followed by 8 Digits Client ID,

7. Members holding shares in Physical Form should enter Folio Number registered with the Company. Next enter the Image Verification as displayed and Click on Login.

8. If you are holding shares in demat form and had logged on to www.evotingindia.com and voted on an earlier voting of any company, then your existing password is to be used.

9. If you are a first time user follow the steps given below:

For M embers holding shares in Demat Form and Physic al Form

PAN

Enter your 10 digit alpha-numeric *PAN issued by Income Tax Department (Applicable for both demat shareholders as well as physical shareholders)

Members who have not updated their PAN with the Company/Depository Participant are requested to use the first two letters of their name and the 8 digits of the sequence number in the PAN field

In case the sequence number is less than 8 digits enter the applicable number of 0's before the number after the first two characters of the name in CAPITAL letters. Eg. If your name is Ramesh Kumar with sequence number 1 then enter RA00000001 in the PAN field.

Enter the Dividend Bank Details or Date of Birth (in dd/mm/yyyy format) as recorded in your demat account or in the company records in order to login.

If both the details are not recorded with the depository or company please enter the member id / folio number in the Dividend Bank details field as mentioned in instruction 16A above

Dividend Bank Details OR Date of Birth (DOB)

?After entering these details appropriately, click on “SUBMIT” tab

?Members holding shares in physical form will then directly reach the Company selection screen. However, members holding shares in demat form will now reach 'Password Creation' menu wherein they are required to mandatorily enter their login password in the new password field. Kindly note that this password is to be also used by the demat holders for voting for resolutions of any other Company on which they are eligible to vote, provided that Company opts for e-voting through CDSL platform. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential.

?For Members holding shares in physical form, the details can be used only for e-voting on the resolutions contained in this Notice.

?Click on the EVSN (Electronic Voting Sequence Number) 170823031 for the relevant <Company Name> Kerala Ayurveda Ltd., on which you choose to vote.


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?On the voting page, you will see “RESOLUTION DESCRIPTION” and against the same the option “YES/NO” for voting. Select the option YES or NO as desired. The option YES implies that you assent to the Resolution and option NO implies that you dissent to the Resolution.

?Click on the “RESOLUTIONS FILE LINK” if you wish to view the entire Resolution details.?After selecting the 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.

?Once you “CONFIRM” your vote on the resolution, you will not be allowed to modify your vote?You can also take a print of the votes cast by clicking on “Click here to print” option on the Voting page.?If a demat account holder has forgotten the login password then Enter the User ID and the image verification

code and click on Forgot Password & enter the details as prompted by the system.

Note for Non – Individual Shareholders and Custodians

?Non-Individual shareholders (i.e. other than Individuals, HUF, NRI etc.) and Custodian are required to log on to www.evotingindia.com and register themselves as Corporates.

?A scanned copy of the Registration Form bearing the stamp and sign of the entity should be emailed to [email protected].

?After receiving the login details a Compliance User should be created using the admin login and password. The Compliance User would be able to link the account(s) for which they wish to vote on.

?The list of accounts linked in the login should be mailed to [email protected] and on approval of the accounts they would be able to cast their vote.

?A scanned copy of the Board Resolution and Power of Attorney (POA) which they have issued in favour of the Custodian, if any, should be uploaded in PDF format in the system for the scrutinizer to verify the same.

B. In case of members receiving the physical copy of the Notice of AGM

Please follow all steps in sl. no. 16 to cast vote17. In case you have any queries or issues regarding e-voting, you may refer the Frequently Asked Questions

(“FAQs”) and e-voting manual available at www.evotingindia.com, under help section or call on toll free no.18002005533 or write an email to contact Mr. Rakesh Dalvi, Dy. Manager, Central Depository Services

t h ( India) Ltd, Phiroze Jeejeebhoy Towers, 16 Floor, Dalal Street, Fort, Mumbai at [email protected] who will also address the grievances connected with the voting by electronic means or can also write to Company Secretary at [email protected] for any grievances related to voting through remote e- voting..

th 18. The e-voting period begins on 23rd September, 2017 (9.00 a.m.) and ends on 26 September, 2017 (5.00 pm). The remote e-voting facility will be blocked thereafter. During this period shareholders' of the Company, holding

stshares either in physical form or in dematerialized form, as on 21 September, 2017. (being cut off date), may cast their vote electronically. Once the vote on a resolution is cast by the shareholder, the shareholder shall not be allowed to change it subsequently. The e-voting module shall be disabled by CDSL for voting thereafter. The member who has voted by Remote e-voting, cannot vote at the meeting.

19. If a person who is not a member on cutoff date receives this notice, he has to treat this notice for information purposes only and he will not be able to e-vote.

20. Mr. P. Sivakumar, Managing Partner, SVJS & Associates, Company Secretaries, Kochi-682 016 has been appointed as the Scrutinizer to scrutinize the e-voting and poll process in a fair and transparent manner.

21. At the AGM, at the end of the discussion on the resolutions on which voting is to be held, the Chairman shall, with the assistance of the Scrutinizer order voting through ballot paper for all those members who are present but not cast their votes electronically through remote e-voting facility.

22. The Scrutinizer shall immediately after conclusion of voting at the AGM, count the votes cast at the AGM and thereafter unblock the votes cast through remote e-voting in the presence of at least two witnesses not in employment of the company. The Scrutinizer shall submit a consolidated Scrutinizer's report of the total votes cast in favour or against, if any, within 48 hours of the conclusion of the AGM, to the Chairman of the Company. Thereafter, the Chairman or any other person authorized by the Chairman, shall declare the result of the voting forthwith.


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23. The results declared along with the Scrutinizer's report shall be placed on the Company's website www.keralaayruveda.biz and on the website of CDSL immediately after the result is declared by the Chairman or any other person authorized by the Chairman and will be communicated to the Bombay Stock Exchange on which the company's equity shares are listed.

24. All documents referred to in the accompanying Notice and the Explanatory Statement shall be open for inspection at the registered office of the Company during normal business hours on all working days, up to and including the date of the Annual General Meeting of the Company.

Explanatory Statement in respect of the Special Business Pursuant to Section 102 of the Companies Act,

2013.

Item No.4

The Board of Directors appointed Mr. Anand Subramanian, (DIN: 00064083) as an Additional Director with effect thfrom 29 September, 2016 pursuant to the provisions of Sections 152, 161 and other applicable provisions of the

Companies Act, 2013 and the rules made there under read with the Articles of Association of the company to hold the office up to the conclusion of the ensuing Annual General Meeting.The company has received a notice in writing from a member under section 160 of the Companies Act, 2013, proposing the candidature of Mr. Anand Subramanian, (DIN: 00064083) along with deposit of requisite amount, for the office of Director to be appointed as such under the provisions of the Companies Act, 2013.A Brief profile of Mr. Anand Subramanian, (DIN: 00064083) has been annexed to this report. Keeping in view the experience and expertise of Mr. Anand Subramanian, (DIN: 00064083), his appointment as Director of the company is recommended for the approval of the members.Except Mr. Anand Subramanian, (DIN: 00064083), no other Director, Key Managerial Personnel of the Company or their relatives are in any way concerned or interested in the Resolution.

Item No.5

M/s Ayurvedagram Heritage Wellness Centre Pvt Ltd. is the subsidiary company of Kerala Ayruveda Ltd, in which your company holds 74% of share capital, based in Karnataka it is a wellness provider company with inpatient and outpatient facilities. We are currently providing 15% discount to this company as per the agreement with the party. Hence, we plan to renew the agreement with Ayurvedagram being our subsidiary.The Board of Directors in its meeting dated 11th August, 2017 resolved to execute an agreement with Ayurvedagram Heritage Wellness Centre Pvt Ltd for the sale of medicines upto ̀ 500 lakhs with a discount upto 15% on MRP for a period of 3 years with effect from 1st April 2017.As per Section 188 of the Companies Act 2013, the company shall not enter into a contract or arrangement with any related party except with the prior approval of the company by a special resolution if they are not in the ordinary course of business and not on arm's length basis Mr. Ramesh Vangal, (DIN 00064018), Chairman, Mr.Anand Subramanian, (DIN 00064083), and Mr. S.Krishnamurthy, (DIN 00140414) Directors of the company are concerned or interested, in the resolution as they are directors of Ayurvedagram Heritage Wellness Centre, subsidiary of Kerala Ayurveda Ltd. They are not holding any shares or beneficial interest in Ayurvedagram Heritage Wellness Centre Pvt Ltd. The Board of Directors recommends this resolution for the approval of the shareholders.

Item No.6

Presently the Board of Directors of the company has been authorized to borrow upto Rs.60.00 crores by a Special Resolution passed at the Annual General Meeting of the company held on 29th September, 2015 as required under Section 180 of the Companies Act 2013.Keeping in view the expansion plans and consequent fund requirements of the company, it is proposed to increase the borrowing limits of the company upto a maximum amount of ̀ 100 crores. Hence the Special resolution in Item no. 6 under Section 180(1)( c) of the Companies Act 2013 is proposed to confirm the borrowing limits of the Company.Directors recommend the Special resolution set out in the Item no. 6 of the Notice for approval.None of the Directors and Key Managerial Persons of the Company and their relatives is concerned or interested, financial or otherwise, in the resolution set out in Item no 6.


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ANNEXURE PURSUANT TO REGULATION 36 OF SEBI (LISTING OBLIGATIONS AND DISCLOSURE

REQUIREMENTS) REGULATIONS, 2015 AND SECRETARIAL STANDARD 2 ISSUED BY ICSI, SHOWING

INFORMATION ABOUT THE DIRECTORS PROPOSED TO BE APPOINTED/ RE-APPOINTED IS FURNISHED

BELOW:

Mr. Ramesh Vangal Non-Executive Chairman

Director Identification Number (DIN) 00064018

Date of Birth 28.07.1954

Age 63

Relationship with other Directors, NIL

Manager and other KMPs

Date of Appointment on Board 02.09.2006

Qualification Engineering degree from IIT, Mumbai

MBA from London Business School

Occupation Professional

Terms and conditions of appointment Appointed as Non-Executive,

Non-Independent Director liable to retire by rotation.

Remuneration sought to be paid NIL

Remuneration last drawn NIL

Shareholding in KAL, held either by him

or on a beneficial basis 6493435 Shares

List of Directorships held in other Companies (excluding foreign and Section 8 Companies)

Name of Committees of the Companies NIL

of which he holds membership.

Experience and Expertise in specific Functional Area

Arudrama Developments Private Ltd, Ayurvedagram Heritage Wellness

Centre Pvt Ltd, Global Agri System Pvt Ltd, Global Nutrifood Private Ltd,

Katra Holding Private Ltd, Katra Phytochem (India) Private Ltd, Katra

Wilhelmsen Logistics Private Ltd, Mason & Summers Leisure Pvt Ltd,

Mason & Summers Alcobev Pvt Ltd, Mason & Summers Marketing

Service Pvt Ltd and Segrow Bio-Technics (India) Pvt Ltd.

Experienced and successful professional with demonstrated leadership in

promoting and growing businesses. Founder and Chairman of the Katra

Group.He was Chairman of Seagram Asia Pacific and President, Asia

Pacific for PepsiCO Foods and a member of PepsiCo’s Worldwide

Executive Council. He also served the Board of Infosys Technologies

Limited.


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Mr. Anand Subramanian Non–Executive Director

Director Identification Number (DIN) 00064083

Date of Birth 01.02.1972

Age 45 years

Relationship with other Directors, NILManager and other KMPs

Date of first Appointment on Board 11.10.2010

Qualification Chartered Accountant

Occupation Professional

Terms and conditions of appointment Appointed as Non-Executive Director liable to retire by rotation

Remuneration sought to be paid NIL

Remuneration last drawn NIL

Shareholding in KAL, held either by him or

on a beneficial basis NIL

List of Directorships held in other Companies (excluding foreign and Section 8 Companies)

Name of Committees of the Companies NIL

of which he holds membership.

Experience and Expertise in specific

Functional Area

Arudrama Developments Private Ltd, Asha Medical Foundation Private Ltd, Avan Agro Tech Private Ltd, Ayurvedagram Heritage Wellness Centre Pvt Ltd, Ayusante Lifecare India Pvt Ltd, Global Nutrifood Private Ltd, KAL Ayurveda Research & Education Foundation, Katra Holding Private Ltd, Katra Liquour Private Ltd, Katra Marine Private Ltd, Katra Phytochem (India)Private Ltd, Katra Wilhelmsen Logistics Private Ltd and Renovel Discoveries Pvt Ltd..

Mr. Anand Subramanian is professionally qualified as a Chartered Accountant. He was with the Arthur Andersen and involved in the Taxation, Corporate Planning. Subsequently he joined Infosys ltd. and later to RSM (Ratan S. Mama, Chartered Accountant Firm). He is involved in financial planning and strategic initiatives of the Company.

Place: AluvathDate : 11 August,2017

By order of the Board of DirectorsFor Kerala Ayurveda Limited

K.RaghunadhanCompany Secretary

Sd/-


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To

The Members

Your Directors have pleasure in presenting the 25th Annual Report on the business and operations of the Company and the Audited Accounts for the Financial Year ended 31st March, 2017.

FINANCIAL RESULTS

The Company's financial performance during the year 2016-17 as compared to the previous year 2015-16 is summarized below:

REVIEW OF OPERATIONS

During the Financial Year under review, the operational results ended with a Profit before Extraordinary items at ̀ 337.32 Lakhs as against ̀ 249.92 Lakhs in the previous year. The Net revenue of the company stands at ̀ 3625.00 Lakhs as against ̀ 3264.40 Lakhs in the previous Financial Year reporting a growth of 11.04%. The consolidated net revenue including its subsidiaries for the year is ̀ 5055.73 Lakhs against ̀ 4601.88 Lakhs during previous year resulting in a growth of 10%.

During the Financial Year under review, your company was able to improve the market share in Kerala and made a big progress out side Kerala.

There are no material changes and commitments 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 this report.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTSst Your company has seven subsidiaries including one step down subsidiary as on 31 March, 2017 and the details are as under:

DIRECTORS’ REPORT

` in Lakhs

* CMS Katra Holdings LLC holds 51% shareholding in CMS Katra Nursing LLC and Nutraveda Inc. holds the balance 49% shareholding; hence CMS Katra Nursing LLCis a fully owned step down subsidiary of your company.

Standalone Consolidated Particulars

2016-17 2015-16 2016-17 2015-16

Product Revenues 3233.00 2757.67 3483.54 2869.97

Service Revenues & Other Incom e 744.00 774.20 1923.14 1999.38

Gross Incom e 3977.00 3531.87 5406.68 4869.35

Less:VAT & Excise Duty 351.00 267.47 350.95 267.47

Net Income from Sales/Services 3625.00 3264.40 5055.73 4601.88

Profit before Interest, Depreciation & Tax (EBITDA)

494.01 416.38 724.82 763.64

Profit/Loss before extraordinary item s 337.32 249.92 424.98 410.83

Extra Ordinary item s 7.08 - 7.08 -

Profit Before Tax 330.24 249.92 417.90 410.83

Net Profit/Loss after tax 227.38 172.60 334.97 273.68

Minority interest in Profit - - 21.99 3.56

Net Consolidated Profit/Loss 227.38 172.60 312.98 270.12

Loss Brought forward from previous year (696.49) (869.09) ( 2884.96) (3056.34)

Loss Carried to the Balance Sheet (469.11) (696.49) (2571.98) (2884.96)

S L N a m e L o c a t io n % o f h o ld in g

1 A y u rv e d a g ra m H e r ita g e W e lln e s s C e n tre P v t L td . In d ia 7 4 %

2 A y u rv e d ic A c a d e m y In c . U S A 1 0 0 %

3 N u tra v e d a In c . U S A 1 0 0 % 4 A y u N a tu ra l M e d ic in e C lin ic , P S

U S A 1 0 0 %

5 C M S K a tra H o ld in g s L L C U S A 8 1 .6 7 %

6 C M S K a tra N u rs in g L L C U S A 1 0 0 % *

7 N u tra v e d a P te L td . S in g a p o re 1 0 0 %


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PERFORMANCE OF SUBSIDIARIES

Indian Subsidiary

During the year under review, M/s. Ayurvedagram Heritage Wellness Centre Pvt. Ltd. has achieved a turnover of ̀ .796.44 lakhs as against ̀ 721.10 lakhs in the previous financial year clocking a growth of 10.45 %.The EBITDA of the company is ` 206.76 lakhs against ̀ 241.00 lakhs in the previous year.

Overseas Subsidiaries

The combined turnover of overseas subsidiaries was ` 740 Lakhs as compared to ` 681.00 Lakhs in the previous year. Kerala Ayurveda Academy is currently offering certified courses in the state of Washington and California and also offers a distant learning course across USA.

CONSOLIDATED FINANCIAL STATEMENTS

As per Rule 8 of Companies (Accounts) Amendments Rules, 2016, a report on the highlights of performance of subsidiaries, associates and joint venture companies and their contributions to the overall performance of the company during the period under report is attached as Annexure 1. Any member indented to have a copy of Balance sheet and other financial statement of these Companies may write to Company Secretary. It shall also be kept for inspection during business hours by any shareholder in the registered office of the Company and the respective offices of its subsidiary companies.

It shall also be made available on the website of the Company www.keralaayurveda.biz / investor-relationship under the “Investors” Tab.

COMPANIES WHICH HAVE BECOME OR CEASED TO BE ITS SUBSIDIARIES DURING THE YEAR

During the financial year ended 31st March, 2017, no entity became or ceased to be the subsidiary, joint venture or associate of the Company.

DIVIDEND

In view of the accumulated losses of the past, your Directors are not in a position to recommend any dividend for the current year.

RESERVES

During the year the total reserves and surplus of the company has improved to ̀ 739 Lakhs from ̀ 512 Lakhs. During the year company earned a net surplus of ` 227 Lakhs. The company does not propose to transfer any amount to reserves during the period.

CHANGE IN THE NATURE OF BUSINESS, IF ANY

There was no change in the nature of business of the Company during the financial year ended 31st March, 2017.

DIRECTORS& KEY MANAGERIAL PERSONS:

Appointment / Reappointment / Resignation of Directors

Pursuant to the provisions of Section 152 of the Companies Act, 2013, and in terms of Articles of Association of the Company, Mr.Ramesh Vangal, (DIN 00064018), Director of the company retires by rotation at ensuing Annual General Meeting and being eligible, offer himself for re-appointment. The Board of Directors recommends his re-appointment.

Mr. Kshiti Ranjan Das (DIN 07212449) – Independent Director and Mr. Gokul Patnaik (DIN 00027915) – Non Executive Director were re-appointed at the Annual General Meeting held on 29.09.2016. Mr. Anand Subramanian, (DIN:00064083) ceased as Alternate Director to Ms. Katarzyna Zimpel on 29.09.2016 and was appointed as an Additional Non Executive Director on 29.09.2016. A resolution for his reappointment as Non-Executive Director is proposed in this Annual General Meeting. Mr. A.T. Jacob, Director resigned with effect from 29.05.2016.

Due to ill health Mr. Ronald George Pearce, DIN:00260166, Vice Chairman & Independent Director had not attended thmeetings during the 12 months period and hence his office of directorship was vacated on 29 September,2016 under

Section 167 of the Companies Act, 2013.

Ms. Katarzyna Zimpel, DIN:00264084, Director, has owing to her personal reasons/commitment, tendered resignation thfrom her office of Non Independent director and her resignation has been accepted with effect from 29 May, 2017.

Ms. Itti Bhargava, Company Secretary resigned with effect from 11.06.2016.thMr. K Raghunadhan, has joined as Company Secretary on18 January, 2017.

None of the directors are disqualified u/s 164(2) of the Companies Act, 2013.


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MEETINGS OF THE BOARD OF DIRECTORS

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year five Board Meetings and four Audit Committee Meetings and three Nomination and Remuneration Committee meetings were convened and held. The details are given in the Corporate Governance Report. The intervening gap between the Meetings was with in the period prescribed under the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015. During the financial year

th th th th 2016-17, the Board of Directors of the Company met on 29 May, 2016, 9 August, 2016, 29 September, 2016, 10th November, 2016 and 14 February, 2017.

th thFurther, separate Meetings of Independent Directors of the Company were held on 10 Nov, 2016 and 14 February, 2017, where at the prescribed items enumerated under Schedule IV to the Companies Act, 2013 and clause 25(4) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 were discussed.

DECLARATION BY INDEPENDENT DIRECTOR(S)

Mr. M C Mohan (DIN: 00633439), Mr. S Krishnamurthy (DIN: 00140414), Mr. Kshiti Ranjan Das (DIN: 07212449) are Independent Directors on the Board of the company.

All the Independent Directors have furnished declarations that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and the Rules made there under.

DETAILS PURSUANT TO SECTION 197(12) OF THE COMPANIES ACT, 2013

Details pursuant to section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 form part of this Report as Annexure 2.

BOARD EVALUATION

Pursuant to the provisions of The Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the working of its Audit, Nomination & Remuneration Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

NOMINATION AND REMUNERATION POLICY OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER

EMPLOYEES

As required under Section 178(1) of the Companies Act, 2013, the Board of Directors of the Company has approved a policy on directors' appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided u/s 178(3).The broad parameters covered under the Policy are - Company Philosophy, Guiding Principles, Nomination of Directors, Remuneration of Directors, Nomination and Remuneration of the Key Managerial Personnel and Senior Management and the Remuneration of other employees. The Company's Policy furnished as Annexure 3 forms part of this Report.

AUDITORS:

1. StatutoryAuditors

M/s. Biju George & Co, Chartered Accountants, Vellaringattu Towers, Thodupuzha 685 584 were appointed as Statutory Auditors of the company upto the conclusion of Annual General Meeting in 2019 subject to ratification at every Annual General Meeting. Company has received a letter, pursuant to Section 139 of the Companies Act, 2013, from M/s. Biju George & Co., Chartered Accountants, Vellaringattu Towers, Thodupuzha 685 584 confirming consent and their eligibility for acting as Statutory Auditors of the Company, if the appointment is ratified at the ensuing Annual General Meeting. The Board recommends ratification of their appointment as Statutory Auditors for the ensuing financial year.

Statutory Auditors' Report

The Auditors' Report does not contain any qualification. Notes to Accounts and Auditors remarks in their report are self-explanatory and do not call for any further comments.

Details in respect of frauds reported by auditors under sub-section (12) of section 143 other than those which are reportable to the Central Government – Nil

2. SecretarialAuditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with corresponding Rules framed there under, M/s. SVJS & Associates were re-appointed as Secretarial Auditors of the company to carry out the secretarial audit for the

styear ending 31 March, 2017.


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Secretarial Audit Report

A Secretarial Audit Report issued by the Secretarial Auditors in Form No. MR-3 is annexed with this Report as Annexure 4. Regarding the requirement of Peer Review Certificate by Statutory Auditors, we were informed by them that they have taken steps to obtain the same. Regarding the requirement of additional Independent Director, the management is taking necessary action to fill the position.

3. Internal Audit &Controls

The Company appointed Mr. Mathew Joseph, Chartered Accountant, as its Internal Auditor. During the year, the Company continued to implement their suggestions and recommendations to improve the control environment. Their scope of work includes review of processes for safeguarding the assets of the Company, review of operational efficiency, effectiveness of systems and processes, and assessing the internal control strengths in all areas. Internal Auditors’ findings are discussed with the process owners and suitable corrective actions taken as per the directions of Audit Committee on an ongoing basis to improve efficiency incoperations.

4. Cost Auditors

According to Companies (Cost Records and Audit) Rules, 2014, your Company is not required to get the cost audit done for financial year 2016-17.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

Pursuant to the provisions of Section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism / Whistle Blower Policy for directors and employees to report genuine concerns has been established. The Vigil Mechanism / Whistle Blower Policy has been uploaded on the website of the Company at www.keralaayurveda.biz under ‘Investor Section’.

The Policy is an extension of the Code of Conduct for Directors & Senior Management Personnel and covers any unethical and improper actions or malpractices and events which have taken place/suspected to take place:

As per the policy all Protected Disclosures should be addressed to the Vigilance Officer / Company Secretary or to the Chairman of the Audit Committee in exceptional cases.

RISK MANAGEMENT POLICY

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. These are discussed at the meetings of the Audit Committee and the Board of Directors of the Company.

The Board of Directors has adopted a risk management policy for the company outlining the parameters of identification, assessment, monitoring and mitigation of various risks which is available on the website of the company.

INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company's internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditors. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

CREDIT RATINGth Kerala Ayurveda Ltd has been awarded NSIC-CRISIL rating of MSE2 which is valid upto 8 May, 2018.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR

TRIBUNALS

There was no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future.

CORPORATE SOCIAL RESPONSIBILITY

Your company always had a deep sense of responsibility towards the community. Company conducted medical camps and free medical checkups at various places. Diabetic Awareness campaigns were held to create awareness. Special Orientation training session conducted on Yoga Day to the public. Corporate Social Responsibility provisions of the Companies Act, 2013 are not applicable to the company.

DEPOSITS

In terms of the provisions of Section 73 of the Companies Act, 2013, the company has not accepted any deposits from the public during the financial year under review and there are no outstanding fixed deposits from the pubic as on 31st March, 2017.


115

Name of the

entity

Relation

Amt in Rupees Lakhs

Particulars of loans, guarantees and

investments

Purpose for which the loan, guarantee and investment are proposed to be utilised

Nutraveda Inc., USA

100% subsidiary

1,159.80 Interest free Working Capital Loan given by KAL to subsidiary

To meet the working capital requirement

Ayurvedic Academy Inc., USA

100% subsidiary

1,162.26 Interest free Working Capital Loan given by KAL to subsidiary


CMS-Katra Holdings LLC, USA

81.67% subsidiary

828.67 Interest free Working Capital Loan given by KAL to subsidiary


Nutraveda PTE Ltd, Singapore

100% subsidiary

0.44 Interest free Working Capital Loan given by KAL to subsidiary


PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

The particulars of contracts or arrangements entered into by the Company with related parties referred to in subsection (1) of Section 188 of the Companies Act, 2013 including certain arm's length transactions under that proviso attached as Annexure 6 in Form AOC-2 forms an integral part of this report.

CORPORATE GOVERNANCE

Your company has complied with corporate governance norms as stipulated by SEBI (Listing Obligations and

Disclosure Requirements) Regulations 2015. A detailed report on Corporate Governance in line with requirements

of the Companies Act, 2013 and SEBI (Listing Obligations sand Disclosure Requirements) Regulations 2015 is

attached to this report. A certificate from statutory auditors confirming the compliance of Corporate Governance is

also attached to this report.

AUDIT COMMITTEE

The details pertaining to composition of Audit Committee are included in the report on corporate Governance.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

A detailed review of operations, performance and future outlook of your company and its businesses is given in the

Management Discussion and Analysis Report, which forms part of this report.

EXTRACT OF ANNUAL RETURN

As required under Section 92(3) of the Companies Act, 2013, an extract of Annual Return in Form MGT9 in

Annexure 5 forms part of this report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186

The Company has provided following loans and guarantees and made following investments pursuant to

Section 186 of the Companies Act, 2013:

Current borrowings of the company are within the limits of Section 180(1)(c) of the Companies Act, 2013


116

DIRECTORS' RESPONSIBILITY STATEMENT

In terms of Section 134(3)(c) of the Companies Act, 2013, in relation to financial statements of the company, the Board of Directors state that:1. in the preparation of the annual accounts, the applicable accounting standards had been followed along

with proper explanation relating to material departures;2. the directors had selected such accounting policies and applied them consistently and made judgments and

estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

3. the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safe guarding the assets of the company and for preventing and detecting fraud and other irregularities;

4. the directors had prepared the annual accounts on a going concern basis;5. the directors, had laid down internal financial controls to be followed by the company and that such internal

financial controls are adequate and were operating effectively, and6. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and

that such systems were adequate and operating effectively.DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORK PALCE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Company has adopted a policy for prevention of Sexual Harassment of Women at workplace as per the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and has set up Committee for implementation of said policy. During the year Company has not received any complaint of harassment.CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUT GO

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under Section134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 furnished in Annexure 7 forms part of this ReportHUMAN RESOURCES

Your Company treats its “human resources” as one of its most important assets. Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. A number of programs that provide focused people attention are currently underway. Your Company's thrust is on the promotion of talent internally through job rotation and job enlargement.RESEARCH AND DEVELOPMENT

The Research and Development (R&D) Center of KAL is well-equipped and is engaged in various Research activities spanning across all areas of Ayurvedic Research. During this year we have received license for Myaxyl Spray, Baby oil and many more Kashayam Tablets.TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Your Company did not have any funds lying in unpaid or unclaimed dividend for a period of seven years. Therefore there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF) under Section 124 of the companies Act, 2013.LISTING WITH STOCK EXCHANGES:

The equity shares of the company are listed on Bombay Stock Exchange and the Company confirms that it has paid the Annual Listing Fees for the year 2017-18 to BSE. ACKNOWLEDGMENTS

The Board places on record its appreciation for the continued patronage, support and co-operation extended by its shareholders, customers, bankers and all Government and statutory agencies with whose help, cooperation and hard work the Company was able to achieve the results. Your directors would further like to record appreciation to the efforts of every employees for their valuable contribution to the Company.


Ramesh Vangal Chairman

(DIN 00064018)Place: Bengaluru

thDate : 11 August, 2017

Sd/-


17

ANNEXURE – 1FORM AOC-1

(Pursuant to first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Amendment Rules, 2016.

Statement Containing Salient features of the financial statement of subsidiaries/ associate companies/ joint ventures

Part “B”: Associates and Joint VenturesStatement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures

NOT APPLICABLE

Name of associates/Joint Ventures

1. Latest audited Balance Sheet Date

2. Date on which the Associate or Joint Venture was associated or acquired

3 Shares of Associate/Joint Ventures held by the company on the year end

No.

Amount of Investment in Associates/Joint Venture

Extend of Holding%

4. Description of how there is significant influence

5. Reason why the associate/joint venture is not consolidated

6. Net worth attributable to shareholding as per latest audited Balance Sheet

7. Profit/Loss for the year

i.Considered in Consolidation

ii.Not Considered in Consolidation

BIJU GEORGE, BS c, FCAPropriet orMEM REGN No. 206233

Bengaluru11 August , 2017t h

For BIJU GEORGE & COChart ered Account ant sFRN: 007920S

Sd/ -

Am t in ` . Lakhs

Sd/ -


Ramesh Vangal Chairman DIN 00064018

Name of Subsidiaries which are yet to commence operations (1) Nutraveda Pte Ltd

Name of subsidiaries which have been liquidated or sold during the year NIL


118

.

.

Sd/-Ramesh Vangal

Chairman(DIN 00064018)

Place: BengaluruthDate : 11 August, 2017

ANNEXURE 2

The ratio of the remuneration of each director to the median employee’s remuneration and other details in terms of sub- section

12 of Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial

Personnel) Amendment Rules, 2016.

Sr.No Requirements Disclosure

1. The ratio of remuneration of each director to the median remuneration of

the employees for the financial year

Employee/WTD 1:12

2. The percentage increase in remuneration of each Director, CFO, CS in the

Financial Year

ED-0%, CS-0%, CFO-0%

3. The percentage increase in the median remuneration of employees in

the financial year

2.14%

4. The number of permanent employees on the rolls of the Company 272

5 Average percentile increase already made in the salaries of employees

other than the managerial personnel.

10%

6. Affirmation that the remuneration is as per the remuneration policy Yes, it is confirmed

* No employee was in receipt of remuneration of more than rupees One Crore and Two lakhs for the FY 2016-17 in aggregate

* No employee who was employed for part of the year was in receipt of remuneration of more than Rupees Eight Lakhs and

Fifty Thousand Per month for the FY 2016-17 as per Rule 5(2) of Companies (Appointment and Remuneration of Managerial

Personnel) Amendment Rules, 2016.

Names of Top 10 employees in terms of remuneration drawn as per Rule 5(2) of Companies (Appointment a nd Remuneration of Managerial Personnel) Amendment Rules, 2016.

ANNEXURE – 2


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ANNEXURE - 3

NOMINATION AND REMUNERATION POLICY OF KERALA AYURVEDA LIMITED

PREAMBLE:

Section 178 of the Companies Act, 2013 and the provisions of the Chapter IV, Regulation 19 of the SEBI (Listing Obligations And Disclosure Requirements) Regulations 2015, require the Nomination and Remuneration Committee of the Board of Directors of every listed entity, to

A. Devise a policy on Board diversity;

B. Identify persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal;

C. Formulate the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees;

D. Formulate the criteria for evaluation of Independent Directors and the Board and carry out evaluation of every director's performance;

E. The company shall disclose the remuneration policy and the evaluation criteria in its Annual Report.

Accordingly, in adherence to the above said requirements the Nomination and Remuneration Committee of the Board of Directors of Kerala Ayurveda Limited(KAL) herein below recommends to the Board of Directors for its adoption the Nomination and Remuneration Policy for the directors, key managerial personnel and other employees of the Company as set out below.

A.POLICY ON BOARD DIVERSITY

A.1.Purpose of this Policy:

This Policy on Board Diversity sets out the Company's approach to ensuring adequate diversity in its Board of Directors (the “Board”) and is devised in consultation with the Nomination and Remuneration Committee (the “Committee”) of the Board.

A.2.Scope of Application:

The aforesaid Policy applies to the Board of Kerala Ayurveda Limited (the “Company”).

A.3.Policy Statement:

The Company believes that a diverse Board will enhance the quality of the decisions made by the Board by utilizing the different skills, qualification, professional experience, knowledge etc. of the members of the Board, necessary for achieving sustainable and balanced development.

For appointments of persons to office of directors and deciding composition of the Board, the Nomination and Remuneration Committee (NRC Committee) and the Board shall also have due regard to this policy on Board diversity.

All Board appointments are made on merit, in the context of the skills, experience, independence, knowledge and integrity which the Board as a whole requires to be effective.

The Board of directors of the Company shall have an optimum combination of executive and non-executive directors. At a minimum, the Board of the Company shall consist of at least one woman Director.

Selection of candidates will be based on a range of diversity perspectives, including but not limited to age, educational background, professional experience, skills, knowledge and length of service. The ultimate decision will be based on merit and contribution that the selected candidates will bring to the Board, having due regard for the benefits of diversity on the Board. The Board's composition (including gender, age, length of service) will be disclosed in the Corporate Governance Report annually.

B. APPOINTMENT AND REMOVAL OF DIRECTOR, KMP AND SENIOR MANAGEMENT

B.1 APPOINTMENT CRITERIA AND QUALIFICATIONS:

1. The Committee shall identify and ascertain the integrity, qualification, expertise and experience of the person for appointment as Director, KMP or at Senior Management level and recommend to the Board his / her appointment.

2. A person should possess adequate qualification, expertise and experience for the position he / she is considered for appointment. The Committee has discretion to decide whether qualification, expertise and experience possessed by a person are sufficient / satisfactory for the concerned position.

3. The Company shall not appoint or continue the employment of any person as Managing Director/Whole-time Director/Manager who has attained the age of seventy years. Provided that the term of the person holding this position may be extended beyond the age of seventy years with the approval of shareholders by passing a special resolution based on the explanatory statement annexed to the notice for such motion indicating the justification for extension of appointment beyond seventy years.


120

B. 2 TERM / TENURE:

1. Managing Director/Whole-time Director/Manager (Managerial Person): The Company shall appoint or re-appoint any personal as its Managerial Person for a term not exceeding five years at a time. No re-appointment shall be made earlier than one year before the expiry of term.

2. Independent Director: An Independent Director shall hold office for a term up to five consecutive years on the Board of the Company and will be eligible for re- appointment on passing of a special resolution by the Company and disclosure of such appointment in the Board's report.

No Independent Director shall hold office for more than two consecutive terms, but such Independent Director shall be eligible for appointment after expiry of three years of ceasing to become an Independent Director. Provided that an Independent Director shall not, during the said period of three years, be appointed in or be associated with the Company in any other capacity, either directly or indirectly.

At the time of appointment of Independent Director it should be ensured that number of Boards on which such Independent Director serves is restricted to seven listed companies as an Independent Director and three listed companies as an Independent Director in case such person is serving as a Whole-time Director of a listed company.

B.3 REMOVAL

Due to reasons for any disqualification mentioned in the Companies Act, 2013, rules made thereunder or under any other applicable Act, rules and regulations, the Committee may recommend, to the Board with reasons recorded in writing, removal of a Director, KMP or Senior Management subject to the provisions and compliance of the said Act, rules and regulations.

B.4 RETIREMENT

The Director, KMP and Senior Management shall retire as per the applicable provisions of the Companies Act, 2013 and the prevailing policy of the Company. The Board will have the discretion to retain the Director, KMP, Senior Management in the same position / remuneration or otherwise even after attaining the retirement age, for the benefit of the Company.

C .REMUNERATION OF THE DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES

REMUNERATION POLICY

C.1 GENERAL

The remuneration / compensation / commission etc. to Managerial Person, KMP and Senior Management Personnel will be determined by the Committee and recommended to the Board for approval. The remuneration / compensation / commission etc. shall be subject to the prior/post approval of the shareholders of the Company and Central Government, wherever required.

The remuneration and commission to be paid to Managerial Person shall be as per the statutory provisions of the Companies Act, 2013, and the rules made there under for the time being in force.

Increments to the existing remuneration / compensation structure may be recommended by the Committee to the Board which should be within the slabs approved by the Shareholders in the case of Managerial Person.

Where any insurance is taken by the Company on behalf of its Managerial Person, KMP and any other employees for indemnifying them against any liability, the premium paid on such insurance shall not be treated as part of the remuneration payable to any such personnel.

C.2 REMUNERATION TO MANAGERIAL PERSON, KMP AND SENIOR MANAGEMENT

1. Fixed pay: Managerial Person, KMP and Senior Management shall be eligible for a monthly remuneration as may be approved by the Board on the recommendation of the Committee in accordance with the statutory provisions of the Companies Act, 2013, and the rules made thereunder for the time being in force. The break-up of the pay scale and quantum of perquisites including, employer's contribution to P.F, pension scheme, medical expenses, club fees etc. shall be decided and approved by the Board on the recommendation of the Committee and approved by the shareholders or /and Central Government, wherever required.

2. Minimum Remuneration: If, in any financial year, the Company has no profits or its profits are inadequate, the Company shall pay remuneration to its Managerial Person in accordance with the provisions of Schedule V of the Companies Act, 2013 and if it is not able to comply with such provisions, with the prior approval of the Central Government.

3. Provisions for excess remuneration: If any Managerial Person draws or receives, directly or indirectly by way of remuneration any such sums in excess of the limits prescribed under the Companies Act, 2013 or without the prior sanction of the Central Government, where required, he / she shall refund such sums to the Company and until such sum is refunded, hold it in trust for the Company. The Company shall not waive recovery of such sum refundable to it unless permitted by the Central Government.

Senior Management: “senior management” shall mean personnel of the company who are members of its core management


121

team excluding Board of Directors. Normally, this would comprise all members of management one level below the executive directors, including all functional heads.

C.3 REMUNERATION TO NON-EXECUTIVE / INDEPENDENT DIRECTOR:

1. Remuneration / Commission: The remuneration / commission shall be in accordance with the statutory provisions of the Companies Act, 2013, and the rules made thereunder for the time being in force.

2. Sitting Fees: The Non- Executive / Independent Director may receive remuneration by way of fees for attending meetings of Board or Committee thereof as decided by the board from time to time. Provided that the amount of such fees shall not exceed the maximum amount as provided in the Companies Act, 2013, per meeting of the Board or Committee or such amount as may be prescribed by the Central Government from time to time.

3. Further, the Company may pay or reimburse to Non-Executive / Independent Director such fair and reasonable expenditure, as may have been incurred by them while performing their role as an Independent Director of the Company. This could include reimbursement of expenditure incurred by them for attending Board/ Committee meetings.

4. Limit of Remuneration /Commission: Remuneration /Commission may be paid within the monetary limit approved by shareholders, subject to the limit not exceeding 1% of the net profits of the Company computed as per the applicable provisions of the Companies Act, 2013.

5. Stock Options: An Independent Director shall not be entitled to any stock option of the Company.

C.4 REMUNERATION TO OTHER EMPLOYEES:

Apart from the Directors, KMP's and senior Management, the remuneration for rest of the employee is determined on the basis of the role and position of the individual employee, including professional experience, responsibility, job complexities and local market conditions.

Decisions on Annual Increment shall be made on the basis of the annual appraisal carries out by HODs of various departments.

D. EVALUATION OF INDEPENDENT DIRECTORS AND THE BOARD

1. INDEPENDENT DIRECTORS:

The Independent Directors shall be evaluated on the basis of the following criteria i.e. whether they:

a) act objectively and constructively while exercising their duties;

b) objectively evaluate Board's performance, rendering independent, unbiased opinion

c) exercise their responsibilities in a bona fide manner in the interest of the company;

d) strive to Attend and participate in the Meetings.

e) devote sufficient time and attention to their professional obligations for informed and balanced decision making;

f) refrain from any action that would lead to loss of his independence and inform the Board immediately when they lose their independence,

g) assist the company in implementing the best corporate governance practices.

h) moderate and arbitrate in the interest of the company as a whole, in situations of conflict between management and shareholder's interest.

i) abide by Company's Memorandum and Articles of Association, company's policies and procedures including code of conduct, insider trading guidelines etc.

Apart from the above criterion below-mentioned indicative list of factors may be evaluated as a part of this exercise:

j) Participation and contribution,

k) Commitment (including guidance provided to senior management outside of Board / Committee meetings),

l) Effective deployment of knowledge and expertise,

m) Effective management of relationship with stakeholders,

n) Integrity and maintenance of confidentiality,

o) Independence of behavior and judgment, and Impact and influence.

Also, once a year, the Board will conduct a self-evaluation. It is the responsibility of the Chairman of the Board to organise the evaluation process and act on its outcome.

2. NON – INDEPENDENT DIRECTORS /EXECUTIVE DIRECTORS

The Executive Directors and Non- independent directors shall be evaluated on the basis of criteria given to them by the board from time to time and their performance will also be reviewed by Independent directors of the Company in their meeting as per Schedule IV of the Companies Act, 2013.


122

Form No. MR-3

SECRETARIAL AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED 31.03.2017

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To

The Members

KERALA AYURVEDA LIMITED

VII/415, Nedumbaserry,

Athani P.O, Aluva,

Ernakulam- 683585, Kerala

We, SVJS & Associates, Company Secretaries, have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by KERALA AYURVEDA LIMITED

[CIN: L24233KL1992PLC006592] (hereinafter called “the Company”). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of books, papers, minute books, forms and returns filed and other records maintained by the Company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of Secretarial Audit, we hereby report that in our opinion, the Company has, during the audit period covering the financial year ended on 31.03.2017 complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended on 31.03.2017 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made there under;

(ii) The Securities Contracts (Regulation) Act, 1956 ('SCRA) and the rules made thereunder;

(iii) The Depositories Act,1996 and the Regulations and Bye-Laws framed thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings. There is no new Foreign Direct Investment during the period under review. There are no External Commercial Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992:-

(a) The Securities and Exchange Board of India (Substantial Acquisition of

Shares and Takeovers) Regulations, 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;

(c) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations,1993 regarding the Companies Act and dealing with client;

(d) The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (to the extent applicable);

(vi) As informed to us, the following other laws are specifically applicable to the Company:

ANNEXURE - 4


123

1. The Drugs and Cosmetics Act, 1940 and The Drugs and Cosmetics Rules, 1945

2. The Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954 and the Drugs and Magic Remedies (Objectionable Advertisements) Rules, 1955

3. The Medicinal and Toilet Preparations (Excise Duties) Act, 1955

4. Food Safety And Standards Act, 2006

We have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards 1 and 2 issued by The Institute of Company Secretaries of India;

(ii) The Listing Agreements entered into by the Company with Bombay Stock Exchange Limited.

During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards etc. mentioned above except to the extent as mentioned below:

The limited review and audit reports are given by an auditor who has not subjected himself to the peer review

process of Institute of Chartered Accountants of India as per Regulation 33 (1) (d) of the Securities and Exchange

Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

We further report that:

The Board of Directors of the Company is duly constituted with proper balance of Executive Directors and Non-executive Directors. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

However, as per Regulation 17 (1) (b) of the Securities and Exchange Board of India (Listing Obligations and

Disclosure Requirements) Regulations, 2015, since the regular non-executive chairperson of the Company is a

promoter of the listed entity and is related to a person occupying management positions at the level of board of

directors as on 31.03.2017, at least half of the board of directors of the Company ought to consist of independent

directors. The Board has three Independent Directors in place of the statutory requirement of four.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advance and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

All decisions of the board were unanimous and the same was captured and recorded as part of the minutes.

We further report that there are adequate systems and processes in the Company commensurate with the size and operations of the Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

We further report that during the audit period there were no instances of:

i. Public/Right/Preferential issue of shares / debentures/sweat equity;

ii. Redemption / buy-back of securities;

iii. Major decisions taken by the members in pursuance to section 180 of the Companies Act, 2013

iv. Merger / amalgamation / reconstruction;

v. Foreign technical collaborations.

This report is to be read with our letter of even date which is annexed as Annexure A and forms an integral part of this report

For SVJS & Associates

Company Secretaries

Sd/-

CS.Vincent P.D.

Partner

CP No:7940 FCS: 3067

Kochith9 August, 2017


124

ANNEXURE A

ANNEXURE TO THE SECRETARIAL AUDIT REPORT OF EVEN DAT

To

The Members

KERALA AYURVEDA LIMITED

VII/415, Nedumbaserry,

Athani P.O, Aluva,

Ernakulam- 683585, Kerala

Our Secretarial Audit Report of even date is to be read along with this letter.

1. Maintenance of the Secretarial records is the responsibility of the management of the Company. Our

responsibility as Secretarial Auditors is to express an opinion on these records, based on our audit.

2. During the audit, we have followed the practices and process as were appropriate, to obtain reasonable

assurance about the correctness of the contents of the Secretarial records. We believe that the process

and practices we followed provide a reasonable basis for our report.

3. The correctness and appropriateness of financial records and Books of Accounts of the Company have not

been verified.

4. We have obtained the Management representation about the Compliance of laws, rules and regulations

and happening of events etc., wherever required.

5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards etc.

is the responsibility of management. Our examination was limited to the verification of the procedures and

compliances on test basis.

6. While forming an opinion on compliance and issuing the Secretarial Audit Report, we have also taken into stconsideration the compliance related actions taken by the Company after 31 March, 2017 but before issue

of the Report.

7. We have considered actions carried out by the Company based on independent legal/professional opinion

as being in compliance with law, wherever there was scope for multiple interpretations.

For SVJS & Associates

Company Secretaries

Sd/-

CS.Vincent P.D.

Partner

CP No:7940 FCS: 3067

Kochith9 August, 2017


125

ANNEXURE – 5

FORM NO. MGT 9EXTRACT OF ANNUAL RETURN

As on financial year ended on 31.03.2017Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company

(Management & Administration) Rules, 2014.

I. I. REGISTRATION & OTHER DETAILS: 1 . CIN L2423 3KL199 2PLC006 592

2 . Regist r a t ion Date 6 th Ju ly 1992

3 . Nam e of the Com p an y Ker ala Ayur veda Ltd .

4 . Categor y/ Sub-categor y of

the Com p an y

Dr ugs an d Phar m aceu t ica ls

5 . Add r ess of the Register ed office & con tact deta ils

VII/ 415 , Nedu m basser y Athan i P O,Aluva 68 358 5

6 . Whether listed com p an y Yes

7 . Nam e, Addr ess & con tact

deta ils of the Regist r ar &

Tr an sfer Agen t , if an y.

M/ s. In tegr a ted Regist r y Man agem en t Ser vice P.Ltd

Ken ces Tow er s, No.1 Ram akr ishn a Str eet

T Nagar , Chen n ai-600 0 17

Ph :044 -28 14 080 1-0 3 Fax:04 4-2 814 24 79

Em ail:csdstd@in tegr ated in d ia .in

II. II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY (All the busin ess act ivit ies

con tr ibu t in g 10 % or m or e of the tota l tu r n over of the com p an y shall b e sta ted)

S. No.

Nam e an d Descr ip t ion of m ain p r oducts / ser vices

NIC Code of the Pr oduct / ser vice

% to tota l tu r n over of the com p an y

1 Ayur ved ic Medicin e 210 03 81%

2 Health Car e Ser vices 869 01 19%

III.PA RTICULA RS O F HO LD IN G , SUBSID IA RY A N D A SSO CIA TE

CO M PA N IES -

Sl

N o.

N ame and address of the Company

CIN /G LN Holding/Subsidiary/A ss

ociate

% of

shares

held

A pplicable

Section

1 Katra Holdings Ltd, M auritius N A Holding 61.52 2(46)

2 A yurvedagram Heritage

W ellness Cnetre Pvt Ltd

U74140KA 200

3PTC031511 Subsidiary

74 2(87)

3 N utraveda Inc, USA N A Subsidiary 100 2(87)

4 A yu N atural M edicine Clinic PS,

USA N A Subsidiary 100 2(87)

5 A yurveda A cademy Inc., USA N A Subsidiary 100 2(87) 6 CM S Katra Holdings LLC, USA N A Subsidiary 100 2(87) 7 CM S Katra N ursing LLC, USA N A Subsidiary 81.67 2(87) 8 N utraveda Pte Ltd., Singapore N A Subsidiary 100 2(87)

Limited

Centre


126

Demat Physical Total

% of

total

share

s

Demat Physical Total

% of

total

shares

%

change

during

the year

A SHAREHOLDING OF PROMOTER AND PROMOTER

GROUP

(1) Indian

a Individual/Hindu Undivided Family

b Central Government

c State Government

d Bodies Corporate

e Financial Institutions/Banks

f Any other(specify)

SUB TOTAL A(1) 0 0 0 0 0 0 0 0.00

(2) Foreign

a Individual(Non resident/foreign)

b Bodies corporate 6493435 0 6493435 62 6493435 0 6493435 61.52

c Institutions

d Qualified Foreign Investor

e Any other(specify)

SUB TOTAL A(2) 6493435 6493435 62 6493435 6493435 61.52 0.000

Total Shareholding of promoter and

Promoter Group(A)=A(1)+A(2) 6493435 6493435 62 6493435 6493435 61.52 0.000

B Public Shareholding

(1) Institutions

a Mutual funds/UTI 2976 2976 2976 2976 0.03

b Financial Institutions/Banks 1709 1709 0.02

c Central Government

d State Government(s)

e Venture Capital Funds

f Insurance Companies

g Foreign Institutional Investors

h Foreign Venture Capital Investors

i Qualified Foreign Investor

No. of shares held at the beginning of

the yearNo. of shares held at end of the year

CATEGORY

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)i) Category-wise Share Holding


127

iii) Change in Promoters’ Shareholding (please specify, if there is no change)

% of total % of total

shares of the shares of the

company company

At the beginning of the year No Change

Date wise Increase / Decrease in PromotersShareholding during the year specifying thereasons for increase / decrease (e.g. allotment/ transfer / bonus/ sweat equity etc.):

No Change

At the end of the year No Change

SN Particulars Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares

No. of shares

ii) Shareholding of Promoter-

SN

Shareholder’s Name

Shareholding at the beginning of the year Shareholding at the end of the year

No. of Shares

% of total Shares of

the company

%of Shares Pledged / encumbered to total shares

No. of Shares

% of total Shares of the

company

%of Shares Pledged / encumbered to total shares

% change in shareholding during the year

1 Katra Holdings Ltd., , Mauritius

6493435 61.52 61.93 6493435 61.52 61.93 NIL

iii) Change in Promoters' Shareholding (please specify, if there is no change)

j Any other(specify)

SUB TOTAL B(1) 2976 2976 4685 4685 0.04 0.010

(2) Non-Institutions

a Bodies Corporate(Indian/foreign/Overseas) 286304 8986 295290 3 243443 8986 252429 2.39

b Individuals(Redident/NRI/Foreign National)

(i)Individual sharehodlers holding Nominal

share Capital upto Rs.1 Lakh 1738584 250751 1989335 19 1499732 243919 1743651 16.52

(ii)Individual sharehodlers holding Nominal

share Capital above Rs.1 Lakh 1060760 656841 1717601 16 1326892 656841 1983733 18.79

c Any other(specify) 57033 0 57033 1 77737 0 77737 0.74

SUB TOTAL B(2) 3142681 916578 4059259 38 3147804 909746 4057550 38.44 -0.020

Total Public Share Holding (B)=B(1)+B(2) 3142681 919554 4062235 38 3147804 914431 4062235 38.48 0.000

TOTAL (A)+(B) 0 0

CShares held by Custodians and against

which Depository Receipts have been issued 0 0

GRAND TOTAL (A)+(B)+(C) 9636116 919554 10555670 100 9641239 914431 10555670 100.00 0.000

0.016

-0.016


128

iv ) Shareholding pattern of top ten shareholders(Other than Directors, Promoters and Holders GDR’s and ADR’s)

SLNO

REM1 OP_BAL OP_PER DIFF DIFF_PER CL_BAL CL_PERReason

for difference

1 Name:SHON RANDHAWAPAN :3693Opening Balance as on 01/04/2016 497642 4.714Closing Balance as on 31/03/2017 497642 4.714 NA

2 Name:K.SWAPNAPAN :AMXPK4845QOpening Balance as on 01/04/2016 102000 0.966Closing Balance as on 31/03/2017 102000 0.966 NA

3Name:SAILESH VIKRAMSINH THAKKERPAN :AAAPT3100GOpening Balance as on 01/04/2016 76000 0.72003/06/2016 -1000 -0.009 75000 0.71124/06/2016 -1000 -0.009 74000 0.70115/07/2016 -3000 -0.028 71000 0.67322/07/2016 -1000 -0.009 70000 0.66302/09/2016 500 0.005 70500 0.66809/09/2016 500 0.005 71000 0.67307/10/2016 500 0.005 71500 0.67709/12/2016 -1500 -0.014 70000 0.66330/12/2016 -2500 -0.024 67500 0.63906/01/2017 -500 -0.005 67000 0.63513/01/2017 1000 0.009 68000 0.64420/01/2017 500 0.005 68500 0.64903/02/2017 -1500 -0.014 67000 0.63524/02/2017 -2000 -0.019 65000 0.61603/03/2017 -8000 -0.076 57000 0.54010/03/2017 -7000 -0.066 50000 0.47417/03/2017 3000 0.028 53000 0.502Closing Balance as on 31/03/2017 53000 0.502 SALE

4

Name:EQUITY INTELLIGENCE INDIA PRIVATE LIMITEDPAN :AABCE2101NOpening Balance as on 01/04/2016 75000 0.71123/09/2016 -14133 -0.134 60867 0.57730/09/2016 -60867 -0.577 0 0.000Closing Balance as on 31/03/2017 0 0.000 SALE


129

5 Name:KRISHNA KODALIPAN :ADFPK4034LOpening Balance as on 01/04/2016 75000 0.711Closing Balance as on 31/03/2017 75000 0.711 NA

6Name:VIPUL PRAHALAD BHAI BHAGATPAN :ALYPB1898GOpening Balance as on 01/04/2016 68182 0.64601/04/2016 -625 -0.006 67557 0.64008/04/2016 -755 -0.007 66802 0.63322/04/2016 -3429 -0.032 63373 0.60029/04/2016 -3742 -0.035 59631 0.56506/05/2016 400 0.004 60031 0.56913/05/2016 -1075 -0.010 58956 0.55920/05/2016 -1294 -0.012 57662 0.54627/05/2016 -825 -0.008 56837 0.53810/06/2016 -25 0.000 56812 0.53817/06/2016 -500 -0.005 56312 0.53324/06/2016 -10995 -0.104 45317 0.42908/07/2016 -200 -0.002 45117 0.42715/07/2016 200 0.002 45317 0.42922/07/2016 -1000 -0.009 44317 0.42029/07/2016 -8644 -0.082 35673 0.33805/08/2016 130 0.001 35803 0.33912/08/2016 -1221 -0.012 34582 0.32802/09/2016 -14375 -0.136 20207 0.19116/09/2016 -4288 -0.041 15919 0.15121/10/2016 -100 -0.001 15819 0.15004/11/2016 -100 -0.001 15719 0.14911/11/2016 -300 -0.003 15419 0.14618/11/2016 90872 0.861 106291 1.00702/12/2016 -105600 -1.000 691 0.007Closing Balance as on 31/03/2017 -10 0.000 681 0.006 SALE

7Name:RAKESH KUMAR JAINPAN :AAFPJ6867KOpening Balance as on 01/04/2016 68000 0.64422/07/2016 -1000 -0.009 67000 0.63503/02/2017 -1000 -0.009 66000 0.62517/02/2017 -1000 -0.009 65000 0.61603/03/2017 -3000 -0.028 62000 0.58710/03/2017 -1000 -0.009 61000 0.578Closing Balance as on 31/03/2017 61000 0.578 SALE


130

8Name:LEELA ANN LINDNERPAN :10Opening Balance as on 01/04/2016 42995 0.407Closing Balance as on 31/03/2017 42995 0.407 NA

9Name:SITA KARA LINDNER

PAN :12Opening Balance as on 01/04/2016 42995 0.407Closing Balance as on 31/03/2017 42995 0.407 NA

10Name:RAMESHWAR NATH PANDEYPAN :AEKPP5636FOpening Balance as on 01/04/2016 40975 0.38822/04/2016 500 0.005 41475 0.39329/04/2016 -500 -0.005 40975 0.38806/05/2016 50 0.000 41025 0.38910/06/2016 1000 0.009 42025 0.39817/06/2016 2701 0.026 44726 0.42430/06/2016 4044 0.038 48770 0.46226/08/2016 67 0.001 48837 0.46302/09/2016 2400 0.023 51237 0.485Closing Balance as on 31/03/2017 51237 0.485 PURCHASE

11 Name:UNNIKRISHNAN E R

PAN :AALPE1704EOpening Balance as on 01/04/2016 33600 0.31820/05/2016 -906 -0.009 32694 0.31024/06/2016 -500 -0.005 32194 0.30508/07/2016 -4 0.000 32190 0.30530/09/2016 -690 -0.007 31500 0.29814/10/2016 -500 -0.005 31000 0.29421/10/2016 -500 -0.005 30500 0.28928/10/2016 -300 -0.003 30200 0.28611/11/2016 -200 -0.002 30000 0.28425/11/2016 -200 -0.002 29800 0.28202/12/2016 -500 -0.005 29300 0.27824/02/2017 -800 -0.008 28500 0.27003/03/2017 -1000 -0.009 27500 0.261Closing Balance as on 31/03/2017 27500 0.261 SALE


31

e) Shareholding of Directors and Key Managerial Personnel:

V) INDEBTEDNESS -Indebtedness of the Company including interest outstanding/accrued but not due for payment.

Secured Loans

excluding deposits

Unsecured Loans

Deposits Total

Indebtedness

Indebtedness at the beginning of the financial year

i) Principal Amount 1436.91 4964.65 6401.56 ii) Interest due but not paid iii) Interest accrued but not due

Total (i+ii+iii) 1436.91 4964.65 6401.56

Change in Indebtedness during the financial year

* Addition 375 16.51 391.51

* Reduction 154.88 181.38 394.26 Net Change 220.12 (164.87) 55.25

Indebtedness at the end of the financial year

i) Principal Amount 1657.03 4799.78 6456.81

ii) Interest due but not paid

iii) Interest accrued but not due

Total (i+ii+iii) 1657.03 4799.78 6456.81

SLNO REM1 OP_BAL OP_P

ER DIFF DIFF_PER CL_BAL

CL_PER

Reason for difference

1 Name: ANIL KUMAR K

PAN :AGFPK6227J

Opening Balance as on 01/04/2016

341579 3.236

13/01/2017 440 0.004 342019 3.240

Closing Balance as on 31/03/2017

342019 3.240 Purchase

2 Name: Mr. Gokul Padnaik

PAN : AKIPP1608H

Opening Balance as on 01/04/2016

65 0

Closing Balance as on 31/03/2017

65 0 NA


32

VII) PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:There were no penalties /punishment/compounding of offences under the companies Act for the year ending 31st March, 2017 except for late filing fees paid for delayed e filing of form amounting to Rs.2400/-.

VI) REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSON NEL- A. Remuneration to Managing Director, Whole-Time Directors and/or Manager: Am ount in `

SN. Particulars of Remuneration Name of MD/WTD/

Manager Total Amount

Dr K Anilkumar, ED Gross salary (a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

29,28,000/-

29,28,000/--

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 Nil Nil

1

(c) Profits in lieu of salary/section 17(3) Income- tax Act, Nil Nil

2 Stock Option / 3. Sweat Equity Nil Nil 4 - Commission - as % of profit / others, Nil Nil

5 Others, please specify Nil Nil

Total (A) 29,28,000/- 29,28,000/-

Ceiling as per the Act Within Limit* Within Limit*

* Ceiling as per Schedule V of the companies Act 2013 is up to 42 Lakhs per Annum

B. Remuneration to other directors. SN Particulars of Remuneration Name of Directors Total Amount

Mr. S Krishnamurthy Mr. Kshiti Ranjan Das Independent Directors Fee for attending board/committee meetings

1,95,000 1,60,000 3,55,000

Commission / others, please specify 0 0 0

1

Total (1) 1,95,000 1,60,000 3,55,000 Other Non-Executive Directors Fee for board committee meetings 0 0 0

2

Commission / Others, please specify 0 0 0

Total (2) 0 0 0

Total (B)=(1+2) 1,95,000 1,60,000 3,55,000

Total Managerial Remuneration 1,95,000 1,60,000 3,55,000 Overall Ceiling as per the Act Within Limit Within Limit Within Limit

Ceiling is maximum Rs.1,00,000 per meeting which can be paid to independent Directors as sitting fee. C. Remuneration To Key Managerial Personnel Other Than Md/Manager/ Wtd SN Particulars of

Remuneration Key Managerial Personnel

CS CS CFO Total

Gross salary in ` Itti Bhargava K.Raghunadhan Arvind Agarwal (a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961

107556

116719

2887000

3111275

(b) Value of perquisites u/s 17(2) Income- tax Act, 1961

0 0 0

1

(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961

0 0 0

2 Stock Option 3. Sweat Equity 0 0 0

4 Commission / - as % of profit 0 0 0 5 Others, please specify 0 0 0

Total 107556 116719 2887000 3111275


33

ANNEXURE - 6 FORM NO. AOC -2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Amendments Rules, 2016.

Form for Disclosure of particulars of contracts/arr angements entered into by the company with related parties referred to in sub section (1) of section 188 of the Companies Act, 2013 including certain arms length transaction under third proviso thereto.

1. Details of contracts or arrangements or transaction s not at Arm’s length basis.

SL. No. Particulars Details

a) Name (s) of the related party & nature of relationship Ayurvedagram Heritage Wellness Centre Pvt Ltd, Subsidiary company

b) Nature of contracts/arrangements/transaction Sale of Ayurvedic Medicines

c) Duration of the contracts/arrangements/transaction 15.12.2014 to 14.12.2017

d) Salient terms of the contracts or arrangements or transaction including the value, if any

15% discount on MRP of Company Products

e) Justification for entering into such contracts or arrangements or transactions

Being a subsidiary of the company, KAL is offering such discount.

f) Date of approval by the Board 6th August, 2014

g) Amount paid as advances, if any NIL

h) Date on which the special resolution was passed in General meeting as required under first proviso to Section 188

29th September. 2014

i) Total Value of Transaction during the year 41.19 lakhs

Details of contracts or arrangements or transactions at Arm’s length basis. A m o u n t in ` La k h s

S l. No

.

N am e of the R elated

Party / N ature of

contracts/arrangem ents

/transaction

N ature of

relation-

ship

D uration of

the contracts/

arrangem ents

/ transaction

Sa lient term s of the contracts or arrangem ents or transaction inc lud ing va lue for one yea r

D ate o f approva l by the B oard/ A ud it com m ittee

A m ount

paid

as advance

1

Purchase of R aw

M aterials- A ll Season

H erbs Pvt Ltd

D irectors ’ re la tive

N eed B ased

30.38

10 th N ov. 2016

N IL

2

R ece iving services by A yuvedagram H eritage W ellness C entre P L td

S ubsid iary

N eed B ased 64.51 10 th N ov. 2016

N IL

3 P urchase o f R aw M ateria l - C A R e K era lam P vt L td .

C om m on D irector

N eed B ased 9 .11 4 th Feb. 2016 N IL

4

R endering o f services- M ason & S um m ers Le isure P L td

C om m on D irector

N eed B ased

3 .66 4 th Feb. 2016

N IL

NIL

5.69


34

Place: BengaluruthDate :11 August, 2017



(DIN 00064018)

Sd/-

5

Reimbursement of Expenses to/by KAL Subsidiaries

Subsidiary

Need Based

58.90 4th Feb. 2016

NIL

6

Reimbursement of Expenses By/to Katra Phytochem India Pvt Ltd

Common Director

Need Based

0.32 4th Feb. 2016

NIL

7 Borrowings (including loans)- from Katra Holding Pvt Ltd

Common Director

Need Based

0.50 4th Feb. 2016

NIL

8

Repayment of Loans-to Katra Holding Pvt Ltd

Common Director

Need Based

175.00 4th Feb. 2016

NIL

9

Managerial Remuneration- Dr K Anilkumar, Director

Whole Time Director

3 year from 28.06.2015

29.28 29th May 2015

NIL

10

Remuneration paid to Mr Arvind Agarwal, CFO

CFO

As per employment agreement

28.77

24th May 2014

NIL

11

Remuneration paid to Ms Itti Bhargava, Company Secretary till 11.6.2016

CS


1.08 13 th Aug.2015

NIL

12

Remuneration paid to Mr.K.Raghunadhan

CS


1.16

10th Nov.2016

NIL

13

Reimbursement of expenses/ Mason & Summers Leisure P Ltd

Common Director

Need Based

0.13 4th Feb. 2016

NIL

14 Purchase / Sale of RM by / to Katra hytochem (India) Pvt Ltd

Common Director

Need Based

47.74 4th Feb. 2016

NIL


35

ANNEXURE 7

Information in accordance with Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies st (Accounts) Amendment Rules, 2016 and forming part of the Board's Report for the year ended 31 March, 2017.

A. CONSERVATION OF ENERGY

I. The Steps taken or Impact on conservation of energy - NILII. The Steps taken By the Company for utilizing alternate source of energy - NILIII. The Capital Investment on energy conservation equipments - NIL

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

I. The efforts made towards technology absorption All developments were done indigenouslyII. The benefits derived like product improvement, cost reduction, product development or import

substitutionDuring the year company added 2 more softgel capsules to the product basket..

III. Details of imported technologyDuring the year, company has not imported any technology. All developments were done indigenously.

IV. The expenditure incurred on research and developmenta) Capital NILb) Deferred Rev Exp ` 78.09 Lacsc) Revenue Expenditure ` 3.43Lacsd) Total ` 81.52Lacse) Total R&D expenditure as a % of turnover 2.25%

C. FOREIGN EXCHANGE EARNINGS & OUTGO

The details of foreign exchange earnings and outgo are as under:

Foreign Exchange earnings & outgo Current yearEarnings ` 46.92 Lacs



(DIN 00064018)Place: Bengaluru

thDate :11 August, 2017

REPORT ON CORPORATE GOVERNANCE

1. COMPANY'S PHILOSOPHY ON CODE OF GOVERNANCEKerala Ayurveda Limited (KAL) believes that sound Corporate Governance is inevitable for improving efficiency and growth as well as enhancing investor confidence. Company has sound corporate practices and conscience, openness, fairness, professionalism and accountability which led it to the great success. The Company is adhering strictly to regulatory frameworks. Honesty, transparency and intensive communication with stakeholders are integral part of our policy. This report sets out the governance systems and processes of the company, as required by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company is generally in compliance with the Corporate Governance norms as stipulated in Listing regulations. except that the number of Independent Directors in the Board went below the norms due to the ill health and vacation of one of the Independent Directors., Statutory Auditors could not obtain a peer review certification.

Sd/-


36

1. BOARD OF DIRECTORS

a) Composition

The KAL Board comprises of Executive, Non-Executive and Independent Directors. The Chairman of the Company is st a Non-Executive Promoter Director. The composition of the Board of Directors as on 31 March 2017 is slightly affected

due to the absence/ ill health of an Independent director which is being rectified by the company in accordance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the provisions of the Companies Act, 2013. All the Directors have informed the company periodically about their Directorship(s) and Membership on the Board Committees of other companies. As per disclosure received from Director(s), none of the directors holds membership in more than ten (10) Committees and Chairmanship in more than (5) committees.

The Board of Directors, overviews the performance of the Company, approves and reviews policies/strategies and evaluates management performance. The composition of the Board of Directors, Board Meetings held during the year under review and other relevant details are given below:

b) Attendance

Mr. A.T. Jacob, Director resigned with effect from 29.05-2016* Due to ill health Mr.Ronald George Pearce, DIN:00260166, Vice Chairman & Independent Director had not attended

thmeetings during the 12 months period and hence his office of directorship was vacated on 29 September, 2016 under Section 167 of the Companies Act, 2013. **Mrs. KatarzynaZimpel, DIN:00264084, Director, has owing to her personal reasons/commitment, tendered resignation from

thher office of director and her resignation has been accepted with effect from 29 May, 2017.

S.No. Date of Board Meeting Total Strength of Board No of Directors Present

1 29th May, 2016 8 7

2 9th August, 2016 8 6

3 29th September, 2016 7 5

4 10th November, 2016 7 6

5 14th February, 2017 7 7

S l.N o . N am e D es ign a tion

N o . o f M ee tings he ld

N o. o f M ee ting s a ttended

A ttendance a t Last A G M

1 M r. R am esh V an ga l N on-E xecu tive

C ha irm an / P rom ote r D irec to r

5 5 Y es

2 M r. R on a ld G eorg e P earce *

N on-E xecu tive /Inde pen den t D irec to r 5 0 N o

3 D r. K A n ilk um ar W ho le T im e /E xecu tive

D irec to r 5 5 Y es

4 M r. M C M o han N on-E xecu tive /

Inde pen den t D irec to r 5

2 N o

5 M r. S K rishn am urth y N on-E xecu tive /

Inde pen den t D irec to r 5 5 Y es

6 M s. K a ta rzyn a Z im pe l * N on-E xecu tive /

P rom ote r D irec to r 5 2 N o

7 M r. G ok u l P a tna ik N on-E xecu tive /V ice C ha irm an / P rom ote r D irec to r

5 5 Y es

8 M r. A n and S ubram an ian N on-E xecu tive / P rom ote r D irec to r

5 2 N o

9 . M r. K sh iti R an ja n D as N on-E xecu tive / Inde pen den t D irec to r 5 5 Y es

c) Meetings of the Board

**


37

e) Pecuniary relationship or transactions

Apart from receiving Directors Sitting Fees, the Non- Executive Directors do not have any material pecuniary relationship or transactions with the company, Promoters, Directors, senior managers or subsidiaries. Except Mr. Ramesh Vangal, and Ms. Katarzyna Zimpel, who are related as husband and wife, none of the other Directors are related to any other director as per the definition of 'relatives' as per Companies Act, 2013.

f) Performance evaluation of DirectorsthThe performance evaluation of Independent Directors was carried out by the Board in its meeting held on 10 November,

th2016 and 14 February, 2017 in accordance with the following criteria laid out by the Nomination & Remuneration Committee and approved by the Board.

Attendance at meetings of Board and Committees, knowledge & ethics, understanding of the roles, responsibilities and duties as director/chairman, contributions at Board/Committees meetings including on strategy and risk management. The evaluation done brings out good performance of Independent Directors in the Board and committees meetings. They are knowledgeable, ethical and bring their respective expertise in the deliberations and make valuable contributions.

thThe Nomination and Remuneration Committee at its meeting held on 10 November, 2016 carried out an evaluation of every director's performance based on aforesaid criteria.

An Evaluation of the various committees of the Board were also carried out based on the aforesaid criteria.

The terms and conditions of appointment of independent directors, as required under the Companies Act, 2013 have been disclosed on the website of the Company at www.keralaayurveda.biz under the “Investors” Section. All Independent directors have furnished declarations that they qualify the conditions of being independent as per Sec. 149(6) of the Companies act, 2013 and regulation 16(1) (b) of SEBI regulations. These were placed before the Board.

thDuring the reporting financial year, two separate Meetings of the Independent Directors of the Company, were held on 10 thNovember, 2016 and 14 February, 2017 whereat the following items as enumerated under Schedule IV to the Companies

Act, 2013 and Regulation 25 (3&4) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 were set out as Agenda:

(1) Review of performance of Non-Independent Directors and the Board as a whole;

(2) Review of performance of the Chairperson of the Company, taking into account the views of Executive Directors and Non-Executive Directors;

(3) Assessment of the quality, quantity and timeliness of flow of information between the company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

g) Familiarization Program for Independent Directors

All Independent Directors were familiarized with the company, their roles, rights, responsibilities in the company, nature of the industry in which the company operates, business model of the company, etc. from time to time.The entire Board including Independent Directors has access to Product Heads/ Factory Heads and other commercial/ technical staff, wherever required for informed decision making.

d) Other Directorships

N a m e (s ) o f D ire c to rs

N o . o f d ire c to rs h ip s

in o th e r B o a rd s (o th e r th a n fo re ig n

& s e c 8 c o m p a n y )

N o .o f C h a irm a n s h ip in

o th e r B o a rd s

(o th e r th a n fo re ig n & s e c

8 c o m p a n y)

N o . o f

M e m b e rs h ip in o th e r B o a rd C o m m itte e s (A u d it c o m m itte e &

s ta k e h o ld e r ’ re la t io n s h ip c o m m itte e )

N o . o f C h a irm a n s h ip in

o th e r B o a rd C o m m itte e s

(A u d it c o m m itte e & s ta k e h o ld e r ’ re la t io n s h ip c o m m itte e )

M r . R a m e s h V a n g a l 1 3 N IL N IL N IL

M r . R o n a ld G e o rg e P e a rc e 1 N IL N IL N IL

D r . K A n ilk u m a r 2 N IL N IL N IL M r . M C M o h a n N IL N IL N IL N IL M r . S K r is h n a m u r th y 3 N IL 8 3

M s . K a ta rz y n a Z im p e l 1 N IL N IL N IL

M r . G o k u l P a tn a ik 1 1 N IL N IL N IL

M r . A n a n d S u b ra m a n ia n 1 3

N IL N IL N IL

M r . K s h it i R a n ja n D a s 1 N IL N IL N IL


38

The detail of such familiarization programme is given below.

This is available on the company's website www.keralaayurveda.biz under (investor)h) Code of Conduct

The Company is committed to conduct its business in accordance with the applicable laws, rules and regulations and with the highest standards of business ethics.The Board has adopted Code of Conduct for Board Members and Senior Management Personnel. The Code was revised by the Board of Directors to suitably incorporate the duties of Independent Directors as laid down in the Companies Act, 2013.i) Company's Policy on Prohibition of Insider Trading

KAL has formulated “Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information” to ensure timely and adequate disclosure of Unpublished Price Sensitive Information. This is published on the company's website www.keralaayurveda.biz/investor-relationships .The Company also has a Code of Conduct to Regulate, Monitor and Report Trading by Insiders3. AUDIT COMMITTEE

thThe present committee as re-constituted on 29 September, 2016, comprises of four directors viz. Mr. S Krishnamurthy- Chairman, Mr. M.C. Mohan, Mr. Kshiti Ranjan Das and Mr. Anand Subramanian as members. Two-Third of the Members of this committee are independent directors and Chairman is an Independent Director.

th th th During the Financial Year 2016-17, four Audit Committee Meetings were held viz. on 28 May, 2016, 9 August, 2016, 10 November, th 2016 and 14 February, 2017. The particulars of Meetings attended by the members of the Audit Committee are given below;

Name of the Director No. of Meetings held No. of Meetings attended

Mr. S Krishnamurthy , Chairman 4 4

Mr. M C Mohan 4 2

Ms. Katarzyna Zimpel * 4 2

Mr. Anand Subramanian 4 2

Mr. Kshiti Ranjan Das 4 4

* Attended by alternate director Mr. Anand Subramanian.thMs. Katarzyna Zimpel ceased to be a member with effect from 29 May, 2017.

thMr. Anand Subramanian was appointed as a member of the committee with effect from 29 September, 2016.The Functional Directors, Senior Managers, Chief Financial Officer, Internal Auditors and Statutory auditors are invited to attend the meetings of the Audit Committee as and when necessary. The Company Secretary acts as Secretary to the Committee.The Board accepted all the recommendations of the Audit Committee during the year.The composition and terms of reference of the Audit Committee is in strict adherence with the requirements specified in Section 177 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Audit Committee discharges such duties and functions generally indicated in the Listing regulations, and the Companies Act, 2013 and the Rules which inter-alia includes the following:

1. Oversight of the company's financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;

2. Recommendation for appointment, remuneration, terms of appointment of auditors of the company ;3. Examining and reviewing, with the management, the annual financial statements and auditor's report there on before

submission to the board for approval;4. Reviewing, with the management, the quarterly financial statements before submission to the board for approval;5. Review and monitor the auditor's independence & performance, and effectiveness of audit process;6. Approval or any subsequent modification of transactions of the company with related parties;7. Scrutiny of inter-corporate loans and investments;8. Valuation of undertakings or assets of the company, wherever it is necessary;9. Evaluation of internal financial controls and risk management systems;10. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control

systems;11. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing

Number of program's attended by Independent Directors (During the year and on cumulative basis till date)

Number of hours spent by Independent Directors in such program's (during the year and

thOne program on 10 November, 2016

4 hours


39

and seniority of the official heading the department, reporting structure coverage and frequency of internal audit;12. Discussion with internal auditors of any significant findings and follow up there on;13. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or

irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;14. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit

discussion to ascertain any area of concern;15. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case

of non-payment of declared dividends) and creditors; if any,16. To review the functioning of the Whistle Blower mechanism;17. Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or

discharging that function) after assessing the qualifications, experience and background, etc. of the candidate;18. Reviewing any other matter which may be specified as role of the Audit Committee under the amendments, if any,

from time to time, to the SEBI (LODR) Regulations, 2015 Companies Act, 2013 and other statue. 19. The audit committee shall mandatorily review the following information: a) management discussion and analysis of financial condition and results of operations; b) statement of significant related party transactions (as defined by the audit committee), submitted by management; c) management letters / letters of internal control weaknesses issued by the statutory auditors; d) internal audit reports relating to internal control weaknesses; and e) the appointment, removal and terms of remuneration of the chief internal auditor shall be subject to review by the audit

committee. f) quarterly statement of deviation(s) including report of monitoring agency, if applicable, submitted to stock exchange(s)

in terms of Regulation 32(1). g) annual statement of funds utilized for purposes other than those stated in the offer document/prospectus/notice in terms of

Regulation 32(7).4. STAKEHOLDER'S RELATIONSHIP COMMITTEE

The committee oversees the transfer of shares, and complaints and grievances of security holders and investors of the company.th th th th th thDuring 2016-17, Committee met 11 times on 15 April, 2016, 25 May 2016, 6 June, 2016, 15 July, 2016, 25 August, 2016, 26

th th th th thSeptember, 2016, 25 October, 2016, 25 November, 2016, 26 December, 2016 ,15 February, 2017 and 6 March, 2017.

The Composition of the committee and attendance at the meetings are given below:

Mr. A.T. Jacob, Director ceased to be a member with effect from 29.05-2016The Company secretary Mr. K Raghunadhan acts as Secretary of the Committee.The equity shares of the company to the extent of 91.34 % are held in dematerialised form and matters relating to physical transfer of shares are minimal.

stNo transfer of physical shares is pending as on 31 March. 2017. During the year company has not received any complaints from its shareholders. The Minutes of the Stakeholders Relationship Committee were noted by the Board at the subsequent Board Meetings.Company has an exclusive E-mail ID viz. [email protected] for registering investor complaints/grievances, 5. NOMINATION & REMUNERATION COMMITTEE

Terms of reference of the Nomination and Remuneration Committee interalia includes1. Formulation of the criteria for determining qualifications, positive attributes and independence of a director and

recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees;

2. Formulation of criteria for evaluation of Independent Directors and the Board;3. Devising a policy on Board diversity;4. Identifying persons who are qualified to become directors and who may be appointed in senior management in

accordance with the criteria laid down, and recommend to the Board their appointment and removal.5. Whether to extend or continue the term of appointment of the independent director, on the basis of the report

of performance evaluation of independent directors .6. Carry out evaluation of every director's performance.

Name of Director Designation No. of Meetings Held No. of Meetings attended

Mr. Gokul Patnaik Chairman 11 8

Dr. K Anilkumar Member 11 11

Mr. S. Krishnamurthy Member 11 10

Mr. A.T. Jacob Member 11 1


40

Composition and AttendanceThe Composition of the committee and attendance at the meetings are given below:

During the financial year committee met three times, on 28th May, 2016, 29th September, 2016 and 10th November, 2016. All directors of the committee are non-executive directors and two out of three members are independent directors.

Remuneration to Directors

The Non-Executive Independent Directors are being paid sitting fees of ` 15,000/- for every Board Meeting and Independent Directors Meetings attended by them and sitting fees of ̀ 10,000/- for every Committee Meeting except the Meeting of the Stakeholders' Relationship Committee, which is ̀ 5,000/-.

Mr. M.C. Mohan has voluntarily relinquished the right to receive sitting fees.

The details of remuneration paid to the Executive Director during the financial year 2016-17 is as follows

Details of sitting fees paid to Non-Executive Directors (Including meeting of Independent Directors)

Name Basic Salary Special

Allowance & HRA

Contribution to Statutory funds

Total

Dr. K Anilkumar, Executive Director 15,00,000 14,28,000 0 29,28,000

(Amount in ` )

(Amount in ` )

Director

No of Board Meetings attended

No of Committee Meetings attended

Independent Directors Meeting

attended Sitting Fees paid

Mr. Ramesh Vangal

5 3 0

Mr. Ronald George Pearce (Independent Director)

0 0 0

Mr. S Krishnamurthy (Independent Director) 5 18 2 1,95,000

Mr. M C Mohan (Independent Director) 2 2 1 0

Mr. Gokul Patnaik 5 8 0

Mr. Anand Subramanian 2 2 0

Mr. Katarzyna Zimpel 2 2 0

Mr. Kshiti Ranjan Das (Independent Director)

5 7

2 1,60,000

Mr. A.T. Jacob 0 1 0

17

Serial No

Name Designation No. No. of Meetings

attended of Meetings Held

No. of Meetings attended

1. Mr. S. Krishnamurthy Chairman 3 3

2. Mr. Ramesh Vangal Member 3 3

3. Mr. Kshiti Ranjan Das Member 3 3


41

Details of shares of the company held by Directors of the Company as on 31st March, 2017 are given below: Name No. of shares % of paid up capital Dr. K. Anilkumar 342019 3.24 Mr. Gokul Patnaik 65 0.00

No other directors of the company hold shares in the company.

Remuneration policy

Your Company has adopted a Nomination and Remuneration Policy on the recommendation of the Nomination and Remuneration Committee. The Policy is shown as annexure 3 to the Directors Report and is also available on the website of the Company www.keralaayurveda.biz in the “Investors” section.

6. GENERAL BODY MEETINGS

a) Annual General MeetingsThe details of Annual General Meetings held during last 3 years are given below:

b)Special Resolutions passed at last 3 AGMsFollowing Special Resolutions were passed at above AGMs by the shareholders with requisite majority:

c) Postal Ballot: SL Date Subject matter of Special resolution

01 07 th December, 2015

Increase in Investment limit upto ` 50 crores .The

voting was through Postal Ballot and Remote e-

voting system. CS Sivakumar, Practising Company Secretary was the scrutinizer for this.

Financial Year Day & Date Time Venue

No. of Special resolutions passed at

AGM

2013-14 Monday

29th September, 2014

2.30 P.M. Green Park Auditorium, N H 47, Desom, Aluva-683103

3

2014-15 Tuesday,


4.30 P.M.

Green Park Auditorium, N H 47, Desom, Aluva-683103

1

2015-16 Thursday,


3.30 P.M.

Green Park Auditorium, N H 47, Desom, Aluva-683103

0

2

SL. Date Subject matter of Special resolution.

01 29th September, 2014 • Agreement with M/s. Ayurvedagram for the sale of medicines.

• Increase in borrowing limit to ` 50 crores

• Increase in Investment limit upto ` 32 Crores.

04 29th September, 2015 • Re-appointment of Dr.Anil Kumar as Executive Director • Increase in Borrowing limits to ` 60 crores

02


42

7. SUBSIDIARY

The Company has 7 Subsidiary Companies, out of which 6 are incorporated outside India. In order to adhere to the specific requirement to formulate a policy, the Board, in its Meeting has expressly adopted the definition of “Material Subsidiary” as given under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 as a Policy Statement for determining 'Material' Subsidiaries of the Company. The Policy is disclosed on the company's website www.keralaayurveda.biz/investor- relationships .The minutes of the Board meetings of the Indian unlisted subsidiary company are placed at the Board meeting of the Company.The Company has also formulated the policy on materiality of related party transactions and on Dealing with Related Party Transactions. The Policy is disclosed on the company's website www.keralaayurveda.biz under ‘investor section’.

8. DISCLOSURES

a) The details of transactions of material nature with its Promoters, Directors or the Management or their subsidiaries or their relatives during the year have been disclosed in notes to Accounts forming part of this Annual Report. There was no instance of non-compliance.

b) All transactions with related parties were in the ordinary course of business and at arm's length. The company has not entered into any transaction of a material nature with any of the related parties which are in conflict with the interest of the company.

c) No penalties or strictures have been imposed on the Company by Stock Exchange or SEBI or any statutory authority on any matter related to capital markets.

d) As per regulation 17(8) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Executive Director and CFO of the company has certified to the Board on their review of financial statements and cash flow statements for the

st Financial Year ended 31 March 2017 in the form prescribed by said regulation.e) No penalty levied by Customs and Central Excise.f) As required under regulation 26(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Directors

and the Senior Management have confirmed compliance with the CODE OF CONDUCT & ETHICS of Board of Directors and st Senior Management for the financial year ended 31 March 2017.

g) The Company has adopted VIGIL MECHANISM / WHISTLE BLOWER POLICY as per regulation 22 and company will also give direct access to the Chairperson of the Audit Committee in case of Whistle Blower Policy. It is also affirmed that no personnel has been denied access to the Audit Committee.

9. MEANS OF COMMUNICATION

The quarterly, half-yearly and yearly financial results of the company are being sent to the Stock Exchanges immediately after the approval of the Board. These results are published in the newspapers viz. Business Line (English daily) as well as in Deepika (Malayalam daily), within forty-eight hours of approval thereof. These are also displayed on the Company's website 'www.keralaayurveda.biz' shortly after its submission to the Stock Exchanges. Company also displays official new release on its website, if any. Thus, the same are not being sent to the shareholders separately and company has not made any presentation to the Institutional Investors or Analysts during the year under review. All data relating to quarterly financial results, shareholding pattern, corporate announcement etc. are also available at the website 'www.corpfiling.co.in' being jointly maintained by BSE & NSE.

10.GENERAL SHAREHOLDER INFORMATION:

i) Annual General MeetingthDay, Date and Time - Wednesday, 27 September, 2017 at 3:30 PM

Venue - Green Park Auditorium, NH47, Desom, Aluva-683103.

ii) Financial Calendar - 1st April, 2017 to 31st March, 2018

iii) Adoption of Financial Results (Tentative) for th nd Quarter ending 30 June, 2017 - 2 week of August, 2017 th ndQuarter ending 30 Sept, 2017 - 2 week of November, 2017st ndQuarter ending 31 Dec, 2017 - 2 week of February, 2017

Quarter & year ending 31st March, 2018 - Last week of May, 2018rd th

iv) Date of Book Closure - 23 Sept.2017 to 27 Sept.2017(Both days inclusive)

v) Dividend payment date - No dividend has been recommended by the Board

vi) Listing on Stock Exchanges: - The equity shares of the Company are listed on Bombay Stock Exchange Ltd

th Phiroze Jeejeebhoy Towers, 16 Floor, Dalal Street, Fort, Mumbai - 400 001

(Stock code: 530163)

vii) Annual Listing Fees - Annual Listing Fees for the FinancialYear 2017-18 to BSE has been paid.

viii) CIN of the company - L24233KL1992PLC006592


43

viii) Stock Price performance: Kerala Ayurveda Ltd. (KAL) vs. BSE Sensex.

ix) Market Price Data: High/Low during each month in last financial Year at Bombay Stock Exchange

Months High Low AverageApril-16 64 53 58May-16 66 54 60June-16 73 55 64July-16 77 64 71Aug-16 75 64 70Sept-16 74 60 67

Months High Low AverageOct-16 77 66 72Nov-16 74 56 65Dec-16 76 68 72Jan-17 82 69 75Feb-17 99 74 86Mar-17 123 89 106

I) Registrar & Share Transfer Agents:

M/s. Integrated Registry Management Services Pvt. Ltd, (earlier known as Chennai having office at Ernakulam is the Registrar & Transfer Agent of the company. Share Transfers, Dematerialization of shares and all other investor related activities are attended and processed at the office of the Registrar & Transfer Agent. Shareholders/ Investors/Depository Participants are requested to send all their documents and communications pertaining to both physical and demat shares to the Registrar at the following address:

M/s. Integrated Registry Management Services Pvt Ltd

Kences Towers 2nd Floor, No.1 Ramakrishna Street Off North Usman Road, T Nagar, Chennai 600017 Ph: 044-28140801-03 Fax : 044-28142479E-mail : [email protected]

ii) Share Transfer System:

At the meetings of the Stakeholders Relationship Committee of the Board, proposals for Share Transfer are being placed and the same are processed within 15 days from the date of receipt subject to the transfer instrument being valid and complete in all respects. Under the same system, the shareholder can approach a Depository Participant (DP) with physical share certificates for dematerialization. The DP will generate a Demat request which will be sent to the Registrar and Transfer Agent along with share certificates. On receipt of the same the Registrar and Transfer Agent will Demat the shares. The Company is also offering a sub division cum Demat scheme for those shareholders who are submitting their shares for sub division. In compliance with the Listing guidelines, every six months, a Practicing Company Secretary audits the system of Transfer and a certificate to that effect is issued.

Integrated Enterprises (India) Ltd.)

Based on the monthly average of high and low prices of KAL and BSE index

Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17

Stock price performance of KAL vs BSE sensex for year ended st31 March 2017


44

xii) Distribution of Shareholding as on 31st March, 2017

1 Upto 5,000 7039 91.20 670538 6.352 5,001 10,000 304 3.94 241103 2.283 10,001 20,000 157 2.03 239972 2.274 20,001 30,000 66 0.86 172268 1.635 30,001 40,000 27 0.35 98949 0.946 40,001 50,000 23 0.30 106433 1.017 50,001 100,000 51 0.66 375285 3.568 Above 100,001 51 0.66 8651122 81.96

Total 7718 100.00 10555670 100.00

SlNo. No of Holders

% to total Holders

Total face value of shares ( in ` )

% to totalface value

Nominal value ofshares (in Rupees)From To

xiii) Shareholders Profile as on 31st March, 2017

Sl Category Holders Holders % No. of Shares Shares %

1 Clearing Members 60 0.78 71808 0.682 Corporate Bodies 112 1.45 258213 2.453 Public (Resident/NRI) 7542 97.72 3701792 35.074 Mutual Funds 1 0.01 2976 0.035 Banks 1 0.01 1709 0.026 Foreign Institutional Investors 1 0.01 25737 0.247 Foreign Promoter 1 0.01 6493435 61.52

(xiv) Global Depository Receipts etc.

The capital of the Company comprises only Equity Shares and the company is not having preference shares, outstanding ADRs or GDRs.(xv) Dematerialisation of shares

The shares of the company are available for trading in the Depository systems of both the National Securities Depository Ltd (NSDL) and the Central Depository Services (India) Ltd. (CDSL) under company (ISIN No. INE817B01025).

st The paid-up capital of your Company as on 31 March 2017 is ̀ 10,55,56,700/- consisting of 10,555,670 shares of Rs10 each which were listed on the Bombay Stock Exchange. Out of the total number of listed shares, 86,40,819 shares forming 81.86% and 10,00,420 shares forming 9.48% stand dematerialized in NSDL and CDSL respectively and remaining 9,14,431 shares being 8.66% stands in physical form as on same date. The Company has established connectivity with both the Depositories through our Registrars, Integrated Registry Management Services Pvt. Ltd., Reconciliation of Share Capital Audit is carried out by the Practicing Company Secretary to reconcile the total admitted capital with NSDL and CDSL and the total issued and listed capital.(xvi) Commodity Price Risk or Foreign Exchange Risk and hedging activities:

There are no imports from abroad and no foreign borrowings and the export receivables are insignificant and forex fluctuations do not have any material impact on the profitability of the Company. The Company is not carrying out any hedging activities. The Company is dealing with Natural products and any increase in the price of raw material or commodity will impact the cost of the product. The Company has the ability to increase the price of the product to cover the cost.

(xvii) Plant Location

01. Kerala Ayurveda Ltd., 02. Kerala Ayurveda Ltd., VII/415, Nedumbassery Raw Drug Division Athani P.O., Aluva - 683 585 Athani P O, Kottai – 683 585

(xviii)Address for correspondence The shareholders may address their communications/suggestions/queries to:

Company Address Registrar and Transfer Agent

The Company Secretary / Compliance Officer, M/s. Integrated Registry Management Services P. Ltd.,M/s. Kerala Ayurveda Ltd., Kences Towers, 2nd Floor VII/415, Nedumbassery, Ramakrishna Street Athani P O, Aluva-683 585. Off North Usman Road Ph : 0484-2476301 (4 lines) T Nagar, Chennai-600 017 Fax : 0484-2474376 Ph: 044-28140801-03 Fax : 044-28142479 Email: [email protected] E-mail : [email protected]

: [email protected]


45

11. NON-MANDATORY REQUIREMENTS

1) The Corporate office of the Company supports the Chairman in discharging his responsibilities.2) As the Company publishes the quarterly financial results in English Newspaper having circulation all over India and in vernacular

Newspaper, the same are not sent to each shareholders, individually.3) The Company did not have any qualifications in the Auditors Report for the financial year 2016-17. The Company continues to

adopt best practices to ensure regime of unqualified financial statements.4) The Company's Board of Directors comprise of professionals with expertise in their respective fields and industry. They

endeavor to keep themselves abreast with changes in global economy and various legislations.

On behalf of the Board of DirectorsFor Kerala Ayurveda Limited

Ramesh Vangal (DIN 00064018)

ChairmanPlace: Bengaluru

thDate : 11 August, 2017

COMPLIANCE WITH CODE OF CONDUCT OF BOARD OF DIRECTORS AND SENIOR MANAGEMENT

To,

The Members of Kerala Ayurveda Ltd.,

As provided under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 all Directors and Members of the Senior Management have affirmed compliance with the Code of Conduct during the Financial Year ended 31 March 2017.

For Kerala Ayurveda Ltd.

Place: Bengaluru Dr. K AnilkumarthDate : 11 August, 2017 (DIN 00226353)

Executive Director

AUDITORS CERTIFICATE

To

The Members of

KERALA AYURVEDA LTD

We have examined the compliance of conditions of Corporate Governance by M/s. Kerala Ayurveda Ltd, for the Financial Year ended on 31 March, 2017, as stipulated in Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 .

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the company for ensuring the compliance of the conditions of the orporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the company.In our opinion and, to the best of our information and according to the explanations given to us, we certify that the company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.We further state that such compliance is neither an assurance to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the company.

BIJU GEORGE, B Sc, FCAProprietorMembership No.206233

Place: BengaluruDate: 11 August, 2017th

For BIJU GEORGE & COChartered AccountantsFRN: 007920S

Sd/-

Sd/-

Sd/-


46

CEO /CFO CERTIFICATION

To,

The Board of Directors,

Kerala Ayurveda Limited

We, the undersigned, in our respective capacities as Executive Director and Chief Financial Officer of Kerala Ayurveda Limited (“the Company”), to the best of our knowledge and belief certify that:

1. We have reviewed financial statements and the cash flow statement for the Financial Year 2016-17 and that to the best of our knowledge and belief :

I. these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

ii. these statements together present a true and fair view of the company's affairs and are in compliance with existing accounting standards, applicable laws and regulations.

2. There are to the best of our knowledge and belief, no transactions entered into by the company during the Financial Year ended on 31st March, 2017 which are fraudulent, illegal or violative of the company's code of conduct.

3. We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the company pertaining to financial reporting and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to take to rectify these deficiencies.

4. During the period under review, no significant changes were observed in the internal controls over financial reporting and accounting policies of the Company. Furthermore, there are no instances of fraud and the

Involvement therein of the management or employees having a Significant role in the company's internal control system over financial reporting.

Place: Bengaluru Dr K Anilkumar Arvind AgarwalthDate: 11 August, 2017 ( Chief Financial Officer

Executive DirectorDIN 00226353)

For Kerala Ayurveda Limited

Sd/- Sd/-


47

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

World Economy Overview

After a lackluster outturn in 2016, economic activity is projected to pick up pace in 2017 and 2018, especially in emerging market and developing economies. World growth is expected to rise from 3.1 percent in 2016 to 3.5 percent in 2017 and 3.6 percent in 2018. Stronger activity, expectations of more robust global demand, reduced deflationary pressures, and optimistic financial markets are all upside developments.

Economic Overview

With 1.2 billion people and the world's third largest economy in purchasing power parity terms, India's recent growth has been a significant achievement. Since independence in 1947, a landmark agricultural revolution has transformed the nation from chronic dependence on grain imports into an agricultural powerhouse that is now a net exporter of food. Life expectancy has increased, literacy rates have improved, health conditions have improved, and a sizeable middle class has emerged. India is now home to globally recognized companies in pharmaceuticals and steel and information and space technologies, and enjoys a voice on the international stage that is more in keeping with its size and potential. Middleclass have become more health conscious and concerned about lifestyle diseases.

Ayurvedic Industry structure and Developments

Ayurveda is gaining acceptance all over the world. India has attained global prominence for its vast Ayurvedic product range and is emerging as preferred destination for medical tourism. More over Government of India is encouraging and promoting Ayurveda through education and national awareness programmes, Various Ayurvedic manufacturing companies are focussing on developing innovative ayurvedic products and investing in marketing strategies in order to generate awareness and increase their brand value as well as sales. All these factors will drive Ayurvedic products market in the country in coming years. Introduction of ayurvedic nutraceuticals and dietary supplements as well as Ayurvedic cosmetics and skin care products is likely to boost the market in the coming years.

Business and Financial Performance review

Kerala Ayurveda Ltd, was founded in 1945. With an experience over 70 years and through a unique combination of heritage richness and investment in technology, KAL has developed into full spectrum Ayurveda Company, encompassing Academies, Herbal Garden, Products, Clinics, Hospitals, Resorts and Research. The KAL Herbarium which has more than 1500 varieties of plant has won many accolades. Potential for growth in areas of healthcare and beauty care products is high. Ayurvedic therapies are gaining popularity, with more hospitals and clinics, the company will be able to capture this market.

The performance review has been dealt in the Directors Report which forms part of this Annual Report.

Strength & Opportunity

We believe the following are our competitive opportunities:

?Strong R&D Capability, many new products under development. Develop medicines which can provide relief to medical conditions for which Allopathy medicines do not provide much relief.

?Have fully integrated GMP manufacturing facility to manufacture both classical and proprietary ayurvedic formulations in the most hygienic condition and strict adherence to prescribed norms.

?Have Competent and experienced team of experts for the standardization of treatments. Growing the well established network of clinics and treatment centre and distribution centers.


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Future Outlook

We are expanding our distribution footprint and introducing our products to far flung areas of East and North India. We are using digital media to reach out more and more customers to establish Kerala Ayurveda as an authentic herbal Ayurveda brand and our thrust is behind ecommerce to expand our outreach to all the doctors and make our products available to everyone in India. Our focus is to launch new products in convenient format to meet the demand of modern times.

Also the National Rural Health Mission has a declared policy of promoting 'Pluralistic Healthcare' by involving, alongside the allopathic system, the AYUSH systems, including local health traditions in its operational mission. Insurance companies have started accepting Ayurveda Treatments under insurance claims.

Risks & Concerns and Threats

The market has both organized and unorganized players, the capability and the strengths differ but both are classified under Ayurveda industry so the organized sector has to work hard to maintain the parameters so that the high standards are maintained and customers should not lose faith in the practice.

However, we have demonstrated excellence in quality of our medicines and KAL is well positioned in the market for quality products. We rely on repeat business based on the strength of our client relationship and a major portion of our revenue comes from key clients. Initiatives are focused on improving client relationship.

Major threats for Ayurveda industry are regulatory concerns, consumer perceptions and competition. The regulatory agencies all over the world are focusing on the Quality, efficacy, safety and standardization of herbal medicines. Your company has been working in this area

Internal Control Systems and their adequacy

KAL has in place a well defined organizational structure and adequate internal controls for efficient operations. In order to ensure orderly and efficient conduct of business the company has put in place systems which include policies and procedures, IT systems, delegation of authority, segregation of duties, internal audit and review framework etc. The team is cognizant of applicable laws and regulations particularly those related to protection of resources and assets, and the accurate reporting of financial transactions. The audit findings are reviewed by the Audit Committee periodically and appropriate followup/corrective actions are initiated.

Material developments in Human Resources/Industrial Relations front, including number of

people employed.

The company places great emphasis on its employees and believes that they are the core of the Corporate Purpose. The HR mission is to empower employees to make continuous improvements and enhance their professional skills. The company believes in respecting the individual rights and dignity of the people. The company believes that human resources are the most valuable assets and a major driver for achieving its

stgoals. The company had 404 employees as on 31 March, 2017.

Cautionary Statement

The statements in this Management Discussion and Analysis describing the company's objectives, projections, estimates and expectations may be treated as 'forward looking statements' within the meaning of applicable laws and regulations. The success in realizing these goals depends on various factors, both internal and external. Therefore, the investors are requested to make their own independent judgements by taking into account all relevant factors before arriving at any investment decision. The company assumes no responsibility to publicly amend, modify or revise any forward looking statements on the basis of any subsequent development, information or events or otherwise.


49

INDEPENDENT AUDITOR'S REPORT

To,

The Members of Kerala Ayurveda Limited

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of Kerala Ayurveda Limited, (“the Company”), which comprise the Balance Sheet as at March 31, 2017 , the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act “) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances.

An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the state of affairs of the Company as at March 31, 2017, and its profit and Cash Flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2016 (“the Order”) issued by the Central Government of India in terms of sub-section (11) of section 143 of The Companies Act 2013, we give in the Annexure B a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable


50

2. As required by section 143(3) of the Act, we report that:

a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b. In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

c. The Balance Sheet, Statement of Profit and Loss, and The Cash Flow Statement dealt with by this Report are in agreement with the books of account..

d. In our opinion, the aforesaid standalone financial statements comply with Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e. On the basis of the written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164(2)of the Act.

f. With respect to adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such Controls ,refer to our separate report in Annexure A :

3. With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

I. the Company does not have any pending litigations which would impact its financial position:

a) the company does not have any long-term contracts requiring a provision for material foreseeable losses.

b) The Company does not have any amounts required to be transferred to the Investor Education and Protection Fund.

c) The company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016. Based on audit procedures and relying on the management representation, we report that the disclosures are in accordance with books of account maintained by the company.

BIJU GEORGE, B Sc, FCA, DISA(ICA)Propriet orMEM REGN No. 206233

Bengalurut h29 May, 2017


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51

Annexure A

Report on the Internal Financial Controls under Clause (I) of Sub-section 3

of Section 143 of the Companies Act, 2013We have audited the internal financial controls over financial reporting of Kerala Ayurveda Limited (“the Company”) as of March 31, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date. Management's Responsibility for Internal Financial Controls

The company's management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively 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, as required under the Companies Act, 2013. Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (The Guidance Note)and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company's internal financial controls system over financial reportingMeaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Opinion

In our opinion, the company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based onthe internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India




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ANNEXURE- B

Auditors Report as per the Companies (Auditors Report) Order 2016

1) (a) the Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. (b) The company has a regular programme of , physical verification of its fixed assets by which fixed assets are verified in a phased

manner or a period of three years. In accordance with this programme, certain fixed assets were verified during the year and no material discrepancies were noticed on such verification. In our opinion, the periodicity of physical verification is reasonable having regard to the size of the company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(2) As explained to us ,Physical verification of inventory has been conducted at reasonable intervals by management and discrepancies noticed on such verification between physical stocks and book records were not material considering the operations of the company and the same have been properly dealt with in the books of account of the company.

3) The company has granted loans, to its subsidiaries covered in the register maintained under Section 189 of The Companies Act, 2013,(the Act)a) In our opinion the terms and conditions on which the loans had been granted to subsidiaries listed in the register maintained under

section 189 of the Act were not, prima facie prejudicial to the interest of the company.b) The loans are interest free and the terms of arrangements do not stipulate any repayment schedule and the loans are repayable on

demand. Accordingly the provisions of clause iii (b) of the order is not applicable.c) There are no overdue amounts in respect of the loans granted to the body cooperates listed in the register maintained under section

189 of the Act.4) In our opinion and according to the information and explanations given to as by the management, the company has complied with the

provisions of the section 185 and 186 of the Companies Act, 2013, with respect to loans, investments, guarantees and securities made.5) The company has not accepted any deposit from the public within the meaning of sections 73 to 76 of the Act and the rules framed there

under to the extent notified.6) We have broadly reviewed the books of account maintained by the Company, pursuant to the Rules made by the Central Government,

under section 148(1) of the Companies Act 2013 for maintenance of cost records and are of the opinion that prima facie , the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

7) According to the records of the company, and information and explanations given to us, the Company has generally been regular in depositing with appropriate authorities undisputed statutory dues including Provident fund, Employees State Insurance, Income Tax, Sales Tax, Service Tax, Duty of Customs, Duty of Excise, Value Added Tax, Cess and any statutory dues applicable to it. There are no

stundisputed statutory dues as referred to above as at 31 March, 2017 outstanding for a period of more than six months from the date they became payable.

8) Based on our audit procedures and according to the information and explanations given to as by the management, the company has not defaulted in repayment of loans or borrowings to a financial institutions, Bank ,Government or dues to debenture holders. The Company has not issued any debentures .

9) In our opinion and according to the information and explanations given to us, the term loans have been applied for the purposes for which they are obtained. Further as per the records, the Company did not raise any money by way of initial public offer, further public offer (including debt instruments).

10) Based upon the audit procedures performed and to the best of our knowledge and belief and according to the information and explanations given to as, no fraud by the Company or any fraud on the Company by its officers or employees has been noticed or reported during the year.

11) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V of the Act .

12) The Company is not a Nidhi Company. Accordingly, paragraph 3 (xii) of the Order is not applicable.13) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with

the related parties are in compliance with sections 177 and 188 of the Act where applicable and details of such transactions have been disclosed in the financial statements as required by the applicable accounting standards.

14) The Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

15) According to the information and explanations given to us and based on our examination of the records of the Company, the Company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3 (xv) of the Order is not applicable.

16) The Company is not required to be registered under section 45-1A of the Reserve Bank of India Act 1934.




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KERALA AYURVEDA LIMITEDst

BALANCE SHEET AS AT 31 MARCH, 2017

In terms of our report attached.

BIJU GEORGE, B Sc, FCAPropriet orMEM REGN No. 206233

Bengaluru29 May, 2017t h

K.RAGHUNADHANCompany Secret ary

For and on behalf of the Board of Directors KERALA AYURVEDA LIMITED

RAMESH VANGALChairman

Dr K ANILKUMARExecut ive Direct or


ARVIND AGARWALChief Financial Of f icer

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Note No.

As at 31st March, 2017


Amount in Rs Amount in Rs

A EQUITY AND LIABILITIES

1 Shareholders’ funds

(a) Share Capi t al 2 105, 556, 700 105, 556, 700

(b) Reserves and Surplus 3 73, 943, 918 51, 206, 015

179, 500, 618 156, 762, 715

2 Non-Current Liabilit ies

(a) Long-Term Bor row ings 4 479, 514, 487 496, 301, 535

(b) Ot her Long-Term Liabi l i t ies 5 3, 915, 000 3, 867, 500

(c) Long-Term Provisions 6 6, 641, 504 6, 578, 669

490, 070, 991 506, 747, 704

3 Current liabilit ies

(a) Shor t t erm Bor row ings 7 165, 702, 747 143, 691, 459

(b) Trade payables 8 19, 687, 654 13, 535, 407

(c) Ot her cur rent l iabi l i t ies 9 26, 099, 836 19, 776, 046

(d) Shor t -t erm Provisions 10 13, 134, 269 4, 121, 164

224, 624, 507 181, 124, 076

894 , 196 , 117 844 , 634 , 495

B ASSETS

1 Non-Current assets

(a) Fixed Asset s

(i ) Tangible Asset s 11 164, 163, 864 162, 627, 302

( i i ) Int angible Asset s 850, 149 -

(b) Non Cur rent Invest m ent s 12 114, 658, 320 114, 647, 970

(c) Def er red Tax Asset s (Net ) 4, 418, 326 14, 704, 188

(d) Long-Term Loans and Advances 13 428, 500, 401 412, 746, 951

712, 591, 059 704, 726, 411

2 Current Assets

(a) Invent or ies 14 60, 724, 178 54, 900, 956

(b) Trade Receivables 15 62, 177, 207 52, 607, 728

(c) Cash and Cash equivalent s 16 17, 128, 434 19, 853, 180

(d) Shor t -Term Loans and Advances 17 41, 575, 239 12, 546, 220

181, 605, 057 139, 908, 085

894 , 196 , 117 844 , 634 , 495

1

Signif icant account ing policies

TOTAL

TOTAL

Part iculars

See accompanying notes 1 to 34 forming part of t he f inancial statements.


54

KERALA AYURVEDA LIMITEDSTATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH, 2017










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KERALA AYURVEDA LIMITEDCASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2017










Sd/ - Sd/ -

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For the year For the year

Ended 31st March, 2017 Ended 31st March, 2016

Am ount in ` Am ount in `

A. CASH FLOW FROM OPERATING ACTIVITIES

Net prof i t bef ore Tax and Int erest 43,052,680 36,401,229

Adj ust ment f or :

Int erest Received (1,446,910) (705,724)

Dividend Received - (5,250)

Depreciat ion 5,639,930 5, 236,834

Prof i t on sale of f ixed asset s (711,706) (20,942)

Operat ing prof it before working capital changes 46,5 33,994 40 ,906,147

Adj ust ment s f or :

Trade receivables (9,569,479) (8,993,033)

Invent or ies (5,823,221) 2, 478,053

Shor t Term loans and advances (29,029,019) 1, 199,016

Long Term loans and advances (15,753,450) (5,979,152)

Long Term Provisions 62,835 122,968

Ot her Long Term Liabi l i t ies 47,500 200,000

Trade Payables 6,152,247 (7,563,956)

Ot her Current Liabi l i t ies 6,323,790 2, 765,158

Shor t Term Provisions 9,013,105 (406,256)

Cash generat ed f rom operat ions (38 ,575,691) (16 ,177,202)

Net cash f rom operat ing act ivi t ies A 7,958,302 24,728,945

B.CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed asset s (8,035,760) (1,894,243)

Sale of f ixed asset s 720,825 119,450

Invest ment s (10,350)

Loans t o Subsidiar ies - (5,454,810)

Dividend Received - 5, 250

Int erest Received 1,446,910 705,724

Net cash used in Invest ing act ivi t ies B (5,878,375) (6,518,629)

C.CASH FLOW FROM FINANCING ACTIVITIES

Repayment (-)/ Proceeds(+) of UnSecured Loans (16,787,048) (2,863,541)

Net Increase/ (Decrease) in Working Capi t al Borrow ings 22,011,289 (1,445,602)

Finance Cost (10,028,915) (11,409,532)

Net cash f rom f inancing act ivi t ies C (4,804,674) (15,718,676)

Net Increase/ (Decrease) in Cash & Cash Equivalent s (A+B+C) (2,724,746) 2, 491,640

Cash & Cash Equivalent s at Beginning of year 19,853,181 17,361,541

Cash & Cash Equivalent s at End of year 17,128,434 19,853,181

Net Increase/ (Decrease) in Cash & Cash Equivalent s (2,724,746) 2, 491,640

Part iculars


56

KERALA AYURVEDA LIMITEDNotes forming part of financial statements for the year ended 31st March, 2017

Note 1-Significant Accounting Policies

1.1 Basis for preparation of financial statements and method of accounting

The financial statements are prepared under the historical cost convention on accrual basis of accounting and in accordance with policies generally accepted in India including Accounting Standards issued by the Institute of Chartered Accountants of India.

1.2 Use of estimates

The preparation of the financial statements in conformity with the accounting standards generally accepted in India requires the management to make estimates that affect the reported amount of assets and liabilities, disclosure of contingent liabilities as at the date of the financial statement and reported amounts of revenues and expenses for the year. Actual results could differ from estimates.

1.3 Fixed Assets

a) Fixed assets are stated at cost less depreciation. Cost includes expenses related to acquisition and installation of fixed assets.

b) Depreciation on all other fixed assets is provided based on the usedful lives of the asset as prescribed under Schedule II of the Companies Act 2013. Depreciation on additions has been calculated on prorata basis.

Assets Useful Life in years (Schedule II)

Land Nil

Building 30

Office Equipments 5

Computers & Peripherals 3

Vehicles 8

Furnitures & Fittings 10

1.4 Borrowing costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets. A qualifying asset is one that has necessarily taken substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

1.5 Inventories

Raw materials, consumables and work-in-progress are valued at cost or net realizable value, whichever is lower. Stores and Spares are valued at cost.

1.6 Revenue Recognition

Sales are net of rebate, discount, excise duty and VAT. Treatment income & consulting charges is recognized on completion of each service & consultation and research/healthcare consultancy income is recognized on accrual basis.

1.7 Transactions in Foreign Exchange

Foreign currency transactions are recorded at the rates of exchange prevailing on the date of the transaction. Foreign currency assets and liabilities at the year end are translated into rupees at the rate of exchange prevailing on the date of balance sheet. All exchange differences are dealt with in the statement of Accounts.

1.8 Employee Benefits / Retirement Benefits.

· Leave Encashment Benefit accounted on the basis that such benefits is payable to employees at the end of the year.

· Gratuity Provision is made based on estimate value basis.

· Provident Fund contribution is as per the rate prescribed by the related Act.

1.9 Research & Development.

Revenue expenditure on research and development is charged to Profit & Loss account. Capital expenditure on research and development is included as a part of fixed assets and depreciated on the same basis as other fixed assets.

1.10 Impairment of assets

Impairment loss if any is provided to the extent the carrying amount of assets exceeds their recoverable amount. Recoverable amount is higher of an asset's net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of useful life.

1.11 Investments

Investments are stated at cost less provision for diminution other than temporary in their values.

1.12 Earnings Per Share

The basic and diluted earnings per share (E P S) is computed by dividing the net profit after tax for the year by weighted average number of equity shares outstanding during the year.

1.13 Provision for Tax

Income tax and Deferred tax provision for the year is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from 'timing difference' between book and taxable profit is accounted by using the tax rates and laws that are enacted or substantively enacted on the Balance Sheet date. The deferred tax asset is recognised and carried forward only to the extent that there is a reasonable certainty that the asset will be realised in future.


57

KERALA AYURVEDA LIMITEDNotes forming part of the financial statements for the year ended 31st March, 2017

Particulars

Number of shares In `

Number of shares In `

2 Share capital

(a) Authorised Capital

Equity shares of ` 10/ - each with vot ing rights 12,000,000 120,000,000 12,000,000 120,000,000

(b) Issued Capital


(c) Subscribed and fully paid up


Total 10,555,670 105,556,700 10,555,670 105,556,700

Notes:

Particulars Opening Balance Fresh issue Buy back Closi ng Balance

Equity shares with vot ing rights

Year ended 31 March, 2017 10,555,670 - - 10,555,670

- Number of shares 105,556,700 - - 105,556,700

- Amount (In ` )

Year ended 31 March, 2016

- Number of shares 10,555,670 - - 10,555,670

- Amount (In ` ) 105,556,700 - - 105,556,700

Number of shares held

% holding in that class of shares




Kat ra Holdings Ltd Maurit ius 6,493,435 61.52% 6,493,435 61.52%

Opening Balance Fresh issue Buy back Closing Balance

As at 31 March, 2017

M/ s Katra Holdings Ltd, the holding company 6,493,435 6,493,435


M/ s Katra Holdings Ltd, the holding company 6,493,435 6,493,435

(i) Reconciliat ion of the number of shares and amount outstanding at the beginning and at the end of the report ing period:

As at 31st March, 2017 As at 31st March, 2016

Particulars Equity shares with voting rights-No of Shares

(ii) Rights, Prefrences and rest rict ions at tached to Equity Shares:

The Company has one class of equity shares, having a par value of ` 10 each. Each shareholder is eligible for one vote per share held.

In the event of liquidat ion, the Equity shareholders are eligible to receive the remaining assets of the company in proport ion to their

share holding.

(iii) Details of shares held by each shareholder holding more than 5% shares:

Class of shares / Name of shareholder As at 31st Ma rch, 2017 As at 31st March, 2016

(iv) Details of shares held by the holding company, the ult imate holding company, their subsidiaries and associates:


58




Amount in ` . Amount in ` .3 Reserves and Surplus

Capital Reserve 4,541,879 4,541,879

Share Premium 114,514,976 114,514,976

General reserve 1,798,000 1,798,000

Surplus / (Def icit ) in Statement of Prof it and Loss At the commencement of the year (69,648,840) (86,908,998)

Add: Prof it for the year 22,737,903 17,260,158

Net Surplus / (Def icit ) in the Statement of Prof it and Loss (46,910,937) (69,648,840)

Total 73,943,918 51,206,015

4 Long-term borrowings

Unsecured

(a) Vehicle Loan 935,246 272,294

(b) Loans and advances from related part ies

Unsecured

From Group Companies

Kat ra Holding Pvt Ltd 478,579,241 496,029,241

Total 479,514,487 496,301,535

5 Other Long-Term Liabilities

Deposits Received from Business associates 3,915,000 3,867,500

Total 3,915,000 3,867,500

6 Long-term Provisions

Provision for Gratuity 6,641,504 6,578,669

Total 6,641,504 6,578,669

7 Short Term Borrowings

Secured loan repayable on demand

Kotak Mahindra Bank-Ernakulam (CC) 16,370,695 22,700,901

Kotak Mahindra Bank-Bangalore (CC) 60,998,317 49,017,820

Kotak Mahindra Bank-Bangalore (OD) 15,000,000 -

Kotak Mahindra Bank Short Term Loan 20,000,000 20,000,000

(Credit Facilit ies from Kotak Mahindra Bank are secured Against

exclusive charge on ent ire current assets of the Company

both present and future , Collateral in the form of equitable mortgage of

land belonging to the Company in Kalloor Thekkummuri Village , Trichur

Dist rict and mortgage of land belonging to Chairman situated at Bangalore

and personal guarantee of Chairman )


ICD from Tata Global Beverages Limited 42,500,000 47,500,000

( E M of 2 Acres and 4 Guntas of land bearing Survey no 49 of Sonnapanahalli Village,

Doddaballapur Taluk, Bengaluru belong to Arudrama )

Kotak Mahindra Bank STL 10,833,736 4,472,737

(Secured by Lein on Fixed Deposit of ` 28,41,133/- held with Kotak Mahindra Bank and personal guarantee of 2 Directors)

Total 165,702,747 143,691,459

Particulars


59




Am ount in ` . Am ount in ` .8 Trade Payables

Sundry Credi t ors- Mf gs. 16,072,320 11,358,165

Sundry Credi t ors- Ot hers 3,615,334 2,177,242

Total 19,687,654 13,535,407

Not e: Dues t o Micro, Small and Medium Ent erpr ies under MSMED Act based on t he

avai lable informat ion wit h t he company

2,403,989 3,413,549

9 Other current liabilit ies

(a) Ot her payables

Advances f rom Cust omers 2,765,722 2,060,034

St at ut ory Liabil i t ies 3,254,960 3,643,078

VAT Payable 894,447 812,170

TDS Payable 935,715 1,535,832

P F ,ESI Et c 1,424,798 1,295,076

Accrued Employee Liabil i t ies 11,411,301 6,876,770

T A Payable 917,446 658,755

Salary Payable 10,493,855 6,218,015

Loans repayable wit hin one year-HP Loan 464,435 163,551

Rent Payable 4,414,123 4,023,981

Ot her Current Liabi l i t ies 3,789,296 3,008,632

Total 26,099,836 19,776,046

10 Short-term provisions

(a) Provision - Ot hers:

Bonus Payable 5,602,528 3,623,993

Pr ivi lage Leave Encashment Payable 798,575 497,171

Provision f or MAT 6,733,166 -

Total 13,134,269 4,121,164

12 Non Current Investments

In Subsidiary Companies

(Unquot ed, At cost )

16,65,000 equit y shares of ` 10 each in 64,286,600 64,286,600

Ayurvedagram Herit age Wellness Cent re Pvt Lt d

100 Common st ock of no par value in Nut raveda Inc,USA 5,620 5,620

100 Common st ock of no par value in Ayu Nat ural 21,516,252 21,516,252

Medicines Cl inic PS. , USA

100 Common st ock of no par value in Ayurvedic

Academy Inc. , USA 27,242,710 27,242,710

817 Common st ock of USD 1 par value in

CMS Kat ra Holdings LLC, USA 34,853 34,853

6201 Shares of face value 1 Sing $ in Nut ravada Pt e Lt d, Singapore 281,935 281,935

Non Trade

(Quot ed, At cost )

550 equit y shares of ` 10 each fully paid up in

(500 equit y shares of ` 10 each fully paid up in)

Canara Bank Ltd(Quoted) Market Value ` 303.00 27,850 17,500

last Year ` 189.95 per share(Unquot ed, At cost )

114 Equit y Shares of ` 10000/- each in 1,262,500 1,262,500

Confederat ion f or Ayurvedic Renaisance Keralam Pvt Lt d

Total 114,658,320 114,647,970

Part iculars


60




Am ount in ` . Am ount in ` .13 Long-Term loans and advances

(Unsecured, considered good unless ot herwise st at ed)

Deposit s wit h Govt . Aut horit ies 1,022,159 978,772

Deposit s wit h ot hers 9,061,027 7,892,351

Income Tax advance 3,401,578 3,341,412

Proj ect Expenses 60,843,436 53,033,881

WIP Nurse Training Deferred 32,321,902 32,383,402

MAT credit entitlement a/c 6,733,166 -

Loans t o Subsidiaries 315,117,135 315,117,135

Total 428,500,402 412,746,952

14 Inventories

(Invent ory as t aken, valued and cert if ied by t he management )

(At lower of cost and net real isable value)

Finished Goods 27,558,641 26,694,848

Goods in t ransi t 1,335,931 329,956

Furnace Oil 376,419 116,486

Packing Mat erial 3,288,537 2,488,594

Raw Mat erial 7,765,617 6,552,292

St ores & Spares 80,718 69,074

Work in Progress 20,318,314 18,649,706

Total 60,724,178 54,900,956

15 Trade receivables


Trade receivables out st anding f or a period exceeding six mont hs f rom t he dat e t hey

were due for payment

3,818,141 3,151,363

Ot her Trade receivables 58,359,066 49,456,365

Total 62,177,207 52,607,728

Not e: Trade receivables include debt s due f rom:

Direct ors * NIL NIL

Ot her of f icers of t he Company * NIL NIL

Firms in which any direct or is a part ner NIL NIL

Privat e companies in which any direct or is a direct or or member NIL NIL

16 Cash and cash equivalents

(a) Cash on hand 968,148 439,112

(b) Cheques, draf t s on hand 936,743 838,919

(c) Balances wit h banks

(i) In Current account s 11,688,470 15,333,262

(i i) In Deposit account s

Bank Deposit s wit h original mat urit y f or more t han 12 mont hs 3,535,073 3,241,887

Total 17,128,434 19,853,180

17 Short-term loans and advances


Advance for Purchase 1,495,055 2,083,827

Ot her Advances 39,685,475 9,946,817

Prepaid expense 394,708 515,575

Total 41,575,238 12,546,219

Of the above, the balances that m eet the definit ion of Cash and cash equivalents as per AS 3 Cash Flow Statem ents is ` 1,71,38,824/-(Previous Year ` 1,98,53,180/-)

Part iculars


61

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62


Notes forming part of Financial Statements for the year ended 31 March, 2017

For the period ended 31st March, 2017



18 Revenue from Operat ions

(a) Sale of product s 323,288,241 275,766,737

(b) Sale of services 72,876,614 76,001,515

Total 396,164,855 351,768,252

(i) Sale of products comprises:

Sale of Ayurvedic Medicine 323,288,241 275,766,737

Total 323,288,241 275,766,737

(ii) Sale of services comprises:

Treat ment Income 59,678,611 62,495,648

Training Income 4,882,877 6,401,609

Regist rat ion Fees 3,201,550 2,553,131

Ot her Operat ional Income 5,113,576 4,551,128

Sale of Scrap 51,666 74,809

Miscel laneous Receipt s 38,833 563,198

Income From Cult ivat ion 350,898 12,060

Cant een Income 4,672,178 3,901,061

Total 72,876,614 76,001,515

19 Other Income

Int erest Received 1,446,910 1,413,177

Dividend Income 5,250

Total 1 ,446,910 1 ,418,427

20 Cost of materials consumed

Raw Material

Opening st ock 6,552,292 6,387,879

Add: Purchases 74,861,255 62,188,683

Less: Closing st ock 7,765,617 6,552,292

(A) 73,647,930 62,024,270 Packing Material

Opening St ock 2,488,594 2,432,082

Add: Purchase 19,474,002 18,165,471

Less: Closing St ock 3,288,537 2,488,594

(B) 18,674,059 18,108,959 Cost of material consumed(A+B) 92,321,989 80,133,229

21 Purchase of Stock In Trade

Purchase of Medicines 3,143,718 3,056,481

Total 3 ,143,718 3 ,056,481

22 Changes in inventories of stock of F G, WIP & Stock in t rade

Invent or ies at t he end of t he year:

St ock of FG,WIP & St ock in Trade 49,212,887 45,674,510

49,212,887 45,674,510

Invent or ies at t he beginning of t he year:


45,674,510 48,024,915

Net (increase) / decrease (3,538,376) 2 ,350,404

23 Employee benefits expense

Salar ies and wages 96,985,028 91,404,256

Cont r ibut ions t o provident f unds 7,073,575 6,622,279

St af f welf are expenses 9,325,822 7,686,037

Total 113,384,425 105,712,572

Notes Part iculars

-


63



For t he pe r iod e nde d 3 1 st March, 2 0 1 7

For t he pe r iod e nde d 3 1 st March, 2 0 1 6

Am o u n t in ` Am o u n t in `

2 4 Finance cost s

(a) Int erest expense on:

( i ) Bor row ings 9, 484, 522 9, 382, 865

( i i ) Ot hers

- Int erest on Vehic le Loans 544, 393 348, 309

Tot al 1 0 , 0 2 8 , 9 1 5 9 , 7 3 1 , 1 7 4

2 5 De pre ciat ion e xpe nse

Depreciat i on 5,639,930 5, 236, 834

Tot al 5 , 6 3 9 , 9 3 0 5 , 2 3 6 , 8 3 4

2 6 Ot he r e xpe nse s

Rent 12, 087, 289 9, 643, 538

Bank Charges 1, 341, 708 1, 678, 358

Rat es and Taxes 846, 213 743, 448

Legal & Prof essional charges 425, 343 622, 467

Di r ect or s Si t t i ng Fee 355, 000 270, 000

Research and Developm ent Expenses 342, 512 234, 662

Travel l i ng -Ot hers 2, 189, 561 2, 160, 918

Loss on sale of f i xed Asset 6, 063 9, 208

Bad Debt s 611, 983 -

Repai r s & Maint anance- Ot hers 2, 123, 448 1, 668, 290

Vehic le Maint enance 296, 093 267, 370

Insurance 480, 148 205, 683

Pr i nt i ng & St at i onery 1, 109, 409 1, 289, 747

Post age & Telephone 1, 935, 050 1, 858, 117

Secret ar i al Expenses 1, 478, 730 1, 423, 584

Repai r s & Maint enance Branch asset s 1, 206, 643 1, 550, 049

Conveyance Expenses 1, 847, 029 841, 540

Cant een Expenses 2, 196, 305 1, 904, 390

Elect r i c i t y charges (Branches/ Depot ) 1, 926, 550 1, 555, 191

Ot her Adm ini st r at i ve Expenses 5, 854, 353 4, 838, 116 In t ernal Aud i t f ee 40, 400 40, 000 Aud i t f ee 126, 250 125, 000

Travel l i ng -Sales St af f 8, 451, 069 7, 888, 624

Adver t i sem ent s 354, 941 371, 797

Com m ission & Discount 7, 225, 984 6, 862, 434

Train ing Expenses 331, 333 483, 523

Fre ight Out w ard 6, 524, 642 6, 166, 448

Sales p rom ot ion exp 6, 754, 021 5, 244, 359

Ot her Sel l i ng & Dist r i but i on Expenses 1, 100, 328 2, 252, 303

Fuel Consum ed 2, 425, 901 3, 070, 105

Elect r i c i t y charges 1, 323, 100 1, 311, 892

Repai r s t o Plant & Machinery 1, 103, 030 984, 727

Repai r s t o Bui l d ing 287, 863 189, 635

Job Works 24, 987, 898 17, 432, 175

Ot her Manuf act ur i ng Expenses 2, 005, 223 3, 649, 877

Cul t i vat i on Expenses 276, 636 66, 812

` Treat m ent Expenses 7, 242, 030 6, 323, 210

Tot al 1 0 9 , 2 2 0 , 0 8 1 9 5 , 2 2 7 , 5 9 7

( i ) Paym ent s t o t he aud i t or s com pr i ses (net of ser v i ce t ax

i nput cred i t , w here app l i cab le) :

As aud i t or s - St at ut or y aud i t & Tax Aud i t 126, 250 125, 000

Reim bursem ent of expenses 29, 600 30, 520

Tot al 1 5 5 , 8 5 0 1 5 5 , 5 2 0

Not e s Par t icu lars


64



27 Earnings in Foreign Currency :

Part iculars 31st March, 2017 31st March, 2016

Export of Medicine 4,692,236 6,752,409

Total 4,692,236 6,752,409

Expenditure in Foreign Currency :


Import of Machinery - -

Total NIL NIL

28

Descript ion of relat ionship

Holding Company

Subsidiary Companies

Direct or/ Key Managerial Person Dr K Anil Kumar, Whole t ime Direct or

Mr Arvind Agarwal , CFO

Ms It t i Bhargava, Company Secret ary

Mr K. Raghunadhan, Company Secret ary


3,038,094 2,260,706

911,239 736,058

10,033,227 3,286,302

- 174,297

536,706 195,555

4,774,120 -

- 304,875

365,218 401,562

2,928,000 3,000,000

2,877,000 4,746,845

Remunerat ion paid to Ms It t i Bhargava, Company Secret ary t i l l 11/ 06/ 2016 107,556 391,667

Remunerat ion paid to Mr K Raghunadhan, Company Secret ary w e f 18/ 01/ 2017 116,719 -

5,890,520 2,941,289

32,368 2,942,358

13,924 -

- 5,454,810

50,000 9,900,000

17,500,000 12,600,000

315,117,134 315,117,134

478,579,241 496,029,241

Receiving services f rom Ayuvedagram Herit age Wellness Cent re P Lt d

Repayment of Loans-t o Kat ra Holding Pvt Lt d

Balances outstanding at the end of the year

Borrowings- f rom Kat ra Holding Pvt Lt d

Remunerat ion paid to Mr Arvind Agarwal, CFO

Reimbursement of Expenses t o Mason & Summers Leisure Pvt Lt d

Lending/ Advances - t o KAL Subsidiaries

Borrowings (including loans)- f rom Kat ra Holding Pvt Lt d

Reimbursement of Expenses By/ t o Kat ra Phyt ochem India Pvt Lt d

Not e: Relat ed part ies have been ident if ied by t he Management .

Details of related party transactions during the ye ar ended 31 March, 2017 and balances outstanding as at 31 March, 2017:

Purchase of Raw Mat erials- Al l Season Herbs Pvt Lt d

Sale of Medicines-Nut raveda Inc

Companies where Promot er Direct or is having

cont rol/ signif icant inf luence

All Seasons Herbs Pvt . Lt d.

KAL Ayurveda Research & Educat ion Foundat ion

Kat ra Holding Pvt . Lt d.

Kat ra Phyt ochem India Pvt . Lt d.

Mason & Summers Leisure Pvt . Lt d.

Nut raveda Inc, USA

Ayu Natural Medicine Cl inic PS, USA


Nut raveda Pt e Lt d, Singapore

CMS Kat ra Holdings LLC, USA

CMS Kat ra Nursing LLC, USA

Confederat ion for Ayurvedic Renaisance Keralam Lt d.

Rendering of services- Ayurvedic Academy Inc

Amount in ` .

Related party transactions

Details of related part ies:

Names of related part ies

Kat ra Holdings Lt d, Maurit ius

Ayurvedagram Herit age Wellness Cent re Pvt Ltd

Lending- t o KAL Subsidiaries

Purchase/ Sale of Raw Mat erials- Confederat ion for Ayurvedic Renaisance Keralam Lt d

Sale of Medicines & Service-Ayurvedagram Herit age Wellness Cent re P Lt d

Purchase/ Sale of Raw Mat erials- Kat ra Phyt ochem India Pvt Lt d

Rendering of services- Mason & Summers Leisure P Lt d

Managerial Remunerat ion- Dr K Anilkumar, Direct or

Reimbursement of Expenses t o/ by KAL Subsidiaries


65

KERALA AYURVEDA LIMITEDNotes forming part of Financial Statements for the year ended 31st March, 2017










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INDEPENDENT AUDITORS' REPORT ON CONSOLIDATED FINANCIAL STATEMENTS

To

The Members of Kerala Ayurveda Limited,

We have audited the accompanying Consolidated Financial statements of Kerala Ayurveda Limited (“the holding Company”) and its subsidiaries(collectively referred to us the Company or Group) comprising of the Consolidated Balance Sheet as at March 31, 2017 , the Consolidated Statement of Profit and Loss, the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information(hereinafter referred to as 'Consolidated financial statements).

Management's Responsibility for the Consolidated Financial Statements

The holding Company's Board of Directors is responsible for the preparation of these Consolidated Financial statements in terms of the requirements of the Companies act 2013 (the Act) that give a true and fair view of the Consolidated financial position, Consolidated financial performance and Consolidated cash flows of the Company in accordance with the accounting principles generally accepted In India, including the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. The respective Board of directors of the Companies included in the group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error which have been used for the purpose of preparation of the Consolidated Financial statements by the directors of the Holding Company ,as aforesaid.

Auditors' Responsibility

Our responsibility is to express an opinion on these Consolidated Financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Consolidated Financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the holding Company's preparation of the Consolidated Financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on whether the holding Company has an adequate internal financial controls system over financial reporting in place and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Holding Company's Board of Directors, as well as evaluating the overall presentation of the Consolidated Financial statements.

We believe that the audit evidence obtained by us and the audit evidence obtained by other auditors in terms of their reports referred to in the other matters below is sufficient and appropriate to provide a basis for our audit opinion on the consolidated financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Consolidated financial statements give the information required by the act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the consolidated state of affairs of the Company as at 31st March, 2017, and their Consolidated profit and their Consolidated cash flows for the year ended on that date.


67




Other Matters

We did not audit the financial statements of subsidiaries ,Ayurvedagram Heritage Wellness Centre Private Limited India, Ayurvedic Academy Inc,Ayu Natural Medicine Clinic PS, Nutraveda Inc , CMS Katra Holding LLC,CMS Katra Nursing LLC USA and Nutraveda PTE Ltd, Singapore whose financial statements reflect total assets of ` 4838.24 Lakhs as at 31st March 2017 ,Total Revenues ̀ 1536.50 Lakhs and total Profit after tax of ̀ 201.22 Lakhs the year ended on that date as considered in the Consolidated financial statements. These financial statements have been audited by other auditors whose reports have been furnished to us by the management and our opinion on the Consolidated financial statements in so far as it relates to the amounts and disclosures included in respect of these subsidiaries, and our report in terms of sub sections (3) and (11) of section n143 of the act so far as it relates to the above subsidiaries is based solely on the report of other auditors.

Our opinion on the Consolidated Financial statements, and our report on other legal and regulatory requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors.

Report on Other Legal and Regulatory Requirements

1. As required by section 143(3) of the Act, we report that:

a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid Consolidated Financial statements

b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid Consolidated Financial statements have been kept by so far as it appears from our examination of those books and the reports of the other auditors.

c) The Consolidated Balance Sheet, the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement dealt with by this report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated financial statements.

d) In our opinion, the aforesaid consolidated financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) On the basis of the written representations received from the directors of the holding Company and stsubsidiary Companies (incorporated In India) as on 31 March, 2017 and taken on record by the respective

Board of Directors of the holding Company and subsidiary Companies , none of the directors of such stCompanies is disqualified as on 31 March, 2017 from being appointed as a director in terms of Section

164(2) of the Act.

f) With respect to adequacy of the internal financial controls over financial reporting of the holding Company and its Indian subsidiary Companies and the operating effectiveness of such controls, refer to our separate report in “Annexure A”

g) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

(i) The Company does not have any pending litigations which would impact its financial position.

(ii) The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

(iii) The company does not have any amounts required to be transferred to the Investor Education and Protection Fund

(iv) The company has provided requisite disclosures in its financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 in respect of parent and subsidiary Companies Incorporated in India and these are in accordance with the books of account maintained.

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68

Annexure A

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the

Companies Act, 2013

We have audited the internal financial controls over financial reporting of Kerala Ayurveda Limited (“the Company”) as of March 31, 2017 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The company's management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India.

These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively 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, as required under the Companies Act, 2013.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (The Guidance Note)and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor's judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company's internal financial controls system over financial reporting

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal financial control over financial reporting includes those policies and procedures that

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;


69

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based onthe internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India

Other Matters

Our aforesaid report under section 143 (3) (i) of the act on the adequacy and operating effectiveness of the internal financial controls over financial reporting insofar as it relates to one subsidiary Company, Incorporated in India ,is based on the corresponding reports of the auditors of such Companies incorporated in India.




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CONSOLIDATED BALANCE SHEET AS AT 31 MARCH, 2017


70




RAGHUNADHAN KCompany Secret ary






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N o t e N o .

A s a t 3 1 st M a r c h , 2 0 1 7

A s a t 3 1 st M a r c h , 2 0 1 6

A m o u n t i n ` A m o u n t i n `A E Q U IT Y A N D L IA B IL IT IE S

1 Sh a r e h o l d e r s’ f u n d s

( a ) Sh a r e C a p i t a l 2 1 0 5 , 5 5 6 , 7 0 0 1 0 5 , 5 5 6 , 7 0 0

( b ) R e se r v e s a n d Su r p l u s 3 ( 1 3 6 , 3 4 3 , 5 3 1 ) ( 1 6 7 , 6 4 0 , 8 4 3 )

( 3 0 , 7 8 6 , 8 3 1 ) ( 6 2 , 0 8 4 , 1 4 3 )

2 N o n - C u r r e n t L i a b i l i t i e s - -

( a ) L o n g - T e r m B o r r o w i n g s 4 5 0 5 , 6 5 9 , 9 0 2 5 2 4 , 9 5 7 , 1 3 2

( b ) O t h e r L o n g - T e r m L i a b i l i t i e s 5 3 , 9 1 5 , 0 0 0 3 , 8 6 7 , 5 0 0

( c ) D e f e r r e d T a x l i a b i l i t y ( N e t ) 3 , 8 6 5 , 2 7 2

( d ) L o n g - T e r m P r o v i s i o n s 6 8 , 3 5 0 , 8 3 5 8 , 1 3 4 , 7 3 9

( e ) M i n o r i t y I n t e r e st 1 4 , 9 4 2 , 0 4 4 1 2 , 7 4 2 , 8 1 8

5 3 6 , 7 3 3 , 0 5 3 5 4 9 , 7 0 2 , 1 8 9

3 C u r r e n t l i a b i l i t i e s - -

( a ) Sh o r t t e r m B o r r o w i n g s 7 1 8 4 , 0 5 6 , 5 7 3 1 6 2 , 6 4 3 , 4 4 6

( b ) T r a d e p a y a b l e s 8 3 4 , 0 1 2 , 4 9 2 2 6 , 2 8 4 , 1 1 1

( c ) O t h e r c u r r e n t l i a b i l i t i e s 9 6 6 , 5 7 7 , 2 7 9 5 0 , 3 1 1 , 8 1 5

( d ) Sh o r t - t e r m P r o v i s i o n s 1 0 1 4 , 8 8 4 , 0 7 9 5 , 6 2 7 , 8 9 0

2 9 9 , 5 3 0 , 4 2 3 2 4 4 , 8 6 7 , 2 6 2

8 0 5 , 4 7 6 , 6 4 4 7 3 2 , 4 8 5 , 3 0 9

B A SSE T S

1 N o n - C u r r e n t a sse t s

( a ) F i x e d A sse t s

( i ) T a n g i b l e A sse t s 1 1 2 2 7 , 8 6 6 , 7 8 0 2 3 7 , 1 7 2 , 1 9 0

( i i ) I n T a n g i b l e A sse t s 5 , 1 6 3 , 9 6 9 1 , 6 2 7 , 1 9 7

( b ) G o o d w i l l O n C o n so l i d a t i o n 1 0 2 , 5 7 7 , 1 6 8 1 0 2 , 5 7 7 , 1 6 8

( c ) N o n C u r r e n t I n v e st m e n t s 1 2 1 , 2 9 0 , 3 5 0 1 , 2 8 0 , 0 0 0

( d ) D e f e r r e d T a x a sse t ( N e t ) - 3 , 7 8 0 , 6 0 9

( e ) L o n g - T e r m L o a n s a n d A d v a n c e s 1 3 2 7 9 , 8 3 0 , 4 0 2 2 4 7 , 9 7 1 , 4 0 0

6 1 6 , 7 2 8 , 6 6 9 5 9 4 , 4 0 8 , 5 6 4

2 C u r r e n t A sse t s

( a ) I n v e n t o r i e s 1 4 6 4 , 5 0 9 , 6 6 9 5 9 , 6 0 1 , 7 4 9

( b ) T r a d e R e c e i v a b l e s 1 5 4 8 , 0 4 9 , 0 6 7 4 1 , 8 9 2 , 3 9 7

( c ) C a sh a n d C a sh e q u i v a l e n t s 1 6 3 4 , 3 5 0 , 9 7 7 2 2 , 7 4 0 , 3 2 2

( d ) Sh o r t - T e r m L o a n s a n d A d v a n c e s 1 7 4 1 , 8 3 8 , 2 6 1 1 3 , 8 4 2 , 2 7 6

1 8 8 , 7 4 7 , 9 7 4 1 3 8 , 0 7 6 , 7 4 5

8 0 5 , 4 7 6 , 6 4 4 7 3 2 , 4 8 5 , 3 0 9

1

P a r t i c u l a r s

Se e a c c o m p a n y i n g n o t e s 1 t o 3 3 f o r m i n g p a r t o f t h e f i n a n c i a l st a t e m e n t s.

Si g n i f i c a n t a c c o u n t i n g p o l i c i e s

T O T A L

T O T A L

0

34


71


CONSOLIDATED PROFIT & LOSS FOR THE YEAR ENDED 31 MARCH 2017


BIJU GEORGE, Bsc, FCAPropriet orMEM REGN No. 206233








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72

KERALA AYURVEDA LIMITEDstCONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARC H, 2017


BIJU GEORGE, Bsc, FCAPropriet orMEM REGN No. 206233








Sd/ - Sd/ -

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For t he ye ar For t he ye ar

Ende d 3 1 st Mar ch, 2 0 1 7 Ende d 3 1 st Mar ch, 2 0 1 6

Am o u n t in ` Am o u n t in `

A. CASH FLOW FROM OPERAT ING ACT IVIT IES

Net p r of i t be f or e Tax and In t e r est 54, 737, 204 54, 035, 502

Ad j ust m ent f or :

In t e r est Rece i ved (1, 446, 910) (705, 724)

Di v i dend Rece i ved - (5, 250)

Dep r ec iat i on 17, 056, 019 18, 974, 395

Mi sce l l aneous Expend i t u r e & Def e r r ed Expend i t u r e Wr i t t en of f 689, 486 903, 598

(Pr of i t ) / Loss on sale o f f i xed asse t s (657, 104) (20, 945)

Ope r at ing pr of i t be for e w or k ing capit al change s 7 0 , 3 7 8 , 6 9 5 7 3 , 1 8 1 , 5 7 6

Ad j ust m ent s f or :

Tr ade r ece i vab les (6, 156, 670) (4, 686, 395)

Inven t or i es (4, 907, 920) 2, 109, 374

Shor t Ter m l oans and advances (27, 995, 985) 1, 093, 327

Long Ter m l oans and advances (31, 859, 001) (6, 814, 756)

Long Ter m Pr ovi si ons 216, 096 281, 424

Ot her Long Ter m Liab i l i t i es 47, 500 200, 000

Tr ade Payab les 7, 728, 381 (3, 823, 686)

Ot her Cur r en t Li ab i l i t i es 16, 265, 464 (3, 207, 234)

Shor t Ter m Pr ovi si ons 9, 256, 189 (2, 969, 977)

Ca sh gener a t ed f r om oper a t ions (3 7 , 4 0 5 , 9 4 6 ) (1 7 , 8 1 7 , 9 2 2 )

Di r ec t Taxes Paid (1 , 3 5 5 , 9 0 4 )

Net cash f r om oper at i ng ac t i v i t i es A 31, 616, 845 55, 363, 654

B. CASH FLOW FROM INVESTING ACTIVITIES

Pur chase of Fi xed asse t s (12, 040, 592) (32, 796, 829)

Sale o f f i xed asse t s 720, 825 119, 450

Invest m ent -Shar es (10, 350)

Di v i dend Rece i ved - 5, 250

In t e r est Rece i ved 1, 446, 910 705, 724

Ne t cash used i n Invest i ng ac t i v i t i es B (9, 883, 207) (31, 966, 405)

C. CASH FLOW FROM FINANCING ACTIVITIES

Repaym ent ( - ) / Pr oceeds(+) o f Secur ed Loans

Repaym ent ( - ) / Pr oceeds(+) o f UnSecur ed Loans (19, 297, 230) (12, 445, 607)

Ne t Incr ease / (Decr ease) i n Wor k i ng Cap i t al Bor r ow ings 21, 413, 127 1, 114, 924

Fi nance Cost (12, 238, 880) (12, 952, 610)

Ne t cash f r om f i nanc ing ac t i v i t i es C (10, 122, 983) (24, 283, 292)

Ne t Incr ease / (Decr ease) i n Cash & Cash Equ i valen t s (A+B+C) 11, 610, 655 (886, 043)

Cash & Cash Equ i valen t s at Beginn ing of year 22, 740, 322 23, 626, 366

Cash & Cash Equ i valen t s at End of year 34, 350, 977 22, 740, 322

Ne t Incr ease / (Decr ease) i n Cash & Cash Equ i valen t s 11, 610, 655 (886, 044)

Par t icu lar s


73


Notes forming part of Consolidated Financial Statements for the year ended 31 March, 2017

Note 1-Significant Accounting Policies

1.1 Principles of Consolidation

The consolidated financial statements have been prepared in accordance with generally accepted accounting principles and comply with the Accounting standards on consolidated financial statements (AS 21) and on Accounting for investments in associates in consolidated financial statements (AS 23), issued by the Institute of Chartered Accountants of India.

1.2 Basis of Preparation

The financial statement of the Kerala Ayurveda Limited and its subsidiaries are prepared on historical cost convention, on the accrual basis of accounting. Foreign subsidiaries results/accounts have been converted into Rupees value at year end rate of 1 US$= ` 64.84 and 1 Singapore $= ` 46.39.

1.3 Fixed Assets

a) Fixed assets are stated at cost less depreciation. Cost includes expenses related to acquisition and installation of fixed assets.

b) Depreciation on all other fixed assets is provided based on the usedful lives of the asset as prescribed under Schedule II of the Companies Act 2013 for Indian entities.

Depreciation on additions has been calculated on prorata basis.

Assets Useful Life in years (Schedule II)

Land Nil

Building 30

Office Equipments 5

Computers & Peripherals 3

Vehicles 8

Furnitures & Fittings 10

1.4 Use of estimates

The preparation of the financial statements in conformity with the accounting standards generally accepted in India requires the management to make estimates that affect the reported amount of assets and liabilities disclosure of contingent liabilities as at the date of the financial statement and reported amounts of revenues and expenses for the year. Actual results could differ from estimates.

1.5 Borrowing costs

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that has necessarily taken substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

1.6 Good Will

Good will arising on the acquisition of a subsidiary represents the excess of the cost of acquisition over the Groups interest in the net value of identifiable assets, Liabilities and contingent liabilities of the subsidiary recognized at the date of acquisition. Good will is initially recognized as an asset at cost and is subsequently measured at cost less any accumulated impairment losses.

1.7 Inventories

Raw materials, consumables and work-in-progress are valued at cost or net realizable value, whichever is lower. Stores and Spares are valued at cost.

1.8 Revenue Recognition

Sales are net of rebate and discount and include excise duty and VAT. Treatment income & Consulting charges is recognized on completion of each service & consultation and research/healthcare consultancy income is recognized on accrual basis

1.9 Transactions in Foreign Exchange

Foreign currency transactions are recorded at the rates of exchange prevailing on the date of the transaction. Foreign currency assets and liabilities at the year end are translated into rupees at the rate of exchange prevailing on the date of balance sheet. All exchange differences are dealt with in the statement of profit and loss account.

1.10 Employee Benefits / Retirement Benefits.

· Leave Encashment Benefit accounted on the basis that such benefits is payable to employees at the end of the year.

· Gratuity Provision is made based on estimated value basis.

· Provident Fund contribution is as per the rate prescribed by the related Act.

1.11 Research & Development.

Revenue expenditure on research and development is charged to Profit & Loss account. Capital expenditure on research and development is included as a part of fixed assets and depreciated on the same basis as other fixed assets.

1.12 Investments

Investments are stated at cost less provision for diminution other than temporary in their values.

1.13 Intangible Assets

Intangible assets are recognized on the basis of the future economic benefits that will flow to the enterprise. The assets are recorded at the price paid to acquire them.

1.14 Impairment of assets

Impairment loss if any, is provided to the extent the carrying amount of assets exceeds their recoverable amount. Recoverable amount is higher of an asset's net selling price and its value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of an asset and from its disposal at the end of useful life.

1.15 Provision for Tax

Income tax and Deferred tax provision for the year is made after taking into consideration benefits admissible under the provisions of the Income Tax Act, 1961. Deferred tax resulting from 'timing difference' between book and taxable profit is accounted by using the tax rates and laws that are enacted or substantively enacted on the Balance Sheet date. The deferred tax asset is recognised and carried forward only to the extent that there is a reasonable certainty that the asset will be realised in future.

1.16 Earnings Per Share

The basic and diluted earnings per share (E P S) is computed by dividing the net profit after tax for the year by weighted average number of equity shares outstanding during the year.


74



Particulars Number of shares Amount in `

Number of shares Amount in `

Share capital

(a) Authorised Capital

Equity shares of ` 10/- each wit h vot ing rights 12,000,000 120,000,000 12,000,000 120,000,000

(b) Issued Capital

Equity shares of ` 10/- each with vot ing rights 10,555,670 105,556,700 10,555,670 105,556,700

(c) Subscribed and fully paid up

Equity shares of ` 10/- each with vot ing rights 10,555,670 105,556,700 10,555,670 105,556,700

Total 10,555,670 105,556,700 10,555,670 105,556,700

Notes:

Particulars Opening Balance Fresh issue Buy back Closi ng Balance


Year ended 31 March, 2017 10,555,670 - - 10,555,670

- Number of shares 105,556,700 - - 105,556,700

- Amount (In ` .)

Year ended 31 March, 2016

- Number of shares 10,555,670 - - 10,555,670

- Amount (In ` .) 105,556,700 - - 105,556,700






Kat ra Holdings Ltd, Maurit ius 6,493,435 61.52% 6,493,435 61.52%

Opening Balance Fresh issue Buy back Closing Balance


M/ s Kat ra Holdings Ltd, the holding company 6,493,435 6,493,435


M/ s Kat ra Holdings Ltd, the holding company 6,493,435 6,493,435

As at 31st March, 2017 As at 31st March, 2016

Particulars Equity shares with voting rights-No of Shares

(ii) Rights, Prefrences and rest rict ions at tached to Equity Shares:

The Company has one class of equity shares, having a par value of ` 10 each. Each shareholder is eligible for one vote per share

held. In the event of liquidat ion, the Equity shareholders are eligible to receive the remaining assets of the company in proport ion to

their share holding.

(iii) Details of shares held by each shareholder holding more than 5% shares:

Class of shares / Name of shareholder As at 31st Ma rch, 2017 As at 31st March, 2016

(iv) Details of shares held by the holding company, the ult imate holding company, their subsidiaries and associates:

(i) Reconciliat ion of the number of shares and amount outstanding at the beginning and at the end of the report ing period:


75





Am oun t in ` . Am oun t in ` .3 Reserves and Surplus -

Capi t al Reserve 4, 541, 879 4, 541, 879

Share Prem ium 114, 514, 976 114, 514, 976

General reserve 1, 798, 000 1, 798, 000

Surplus / (Def ici t ) in St at ement of Prof i t and Loss At t he commencement of t he year (288, 495, 698) (315, 508, 194)

Add: Prof i t f or t he year 31, 297, 312 27, 012, 496

Net Surplus / (Def ici t ) in t he St at ement of Prof i t and Loss (257, 198, 386) (288, 495, 698)

Total (136 , 343 , 531) (167 , 640 , 843)

4 Long-term borrow ings

(a) Term Loan From Banks

Secured

Vehicle Loan 935, 246 714, 731

(b) Loans and advances f rom relat ed par t ies

Unsecured

Kat ra Holding Pvt Lt d 478, 579, 241 497, 495, 596

Kat ra Finance Lt d, Maur i t ius 25, 497, 029 26, 083, 505

Ot her Loans 648, 386 663, 300

Ayu Inc - -

Total 505 , 659 , 902 524 , 957 , 132

Not e: Car loans are secured by hypot hicat ion of respect ive vehicle

5 Other Long-Term Liabilit ies

Deposi t s Received f rom Business associat es 3, 915, 000 3, 867, 500

Total 3 , 915 , 000 3 , 867 , 500

6 Long-term Provisions

Provision f or Grat ui t y 8, 350, 835 8, 134, 739

Total 8 , 350 , 835 8 , 134 , 739

7 Short Term Borrow ings


Kot ak Mahindra Bank-Ernakulam (CC) 16, 370, 695 22, 700, 901

Kot ak Mahindra Bank-Bangalore (CC) 60, 998, 317 49, 017, 820

Kot ak Mahindra Bank-Bangalore (OD) 15, 000, 000

Kot ak Mahindra Bank Shor t Term Loan 20, 000, 000 20, 000, 000

Kot ak Mahindra Bank-Bangalore (OD Ayurvedagram) 16, 243, 899 14, 208, 939

(Credi t Faci l i t ies f rom Kot ak Mahindra Bank are secured Against - -

exclusive charge on ent i re cur rent asset s of t he Company - -

bot h present and f ut ure, Col lat eral in t he f orm of equi t able mor t gage of - -

land belonging t o t he Company in Kal loor Thekkummur i Vi l lage, Tr ichur - -

Dist r ict and mor t gage of land belonging t o Chai rman si t uat ed at Bangalore - -

and personal guarant ee of Chai rman ) - -

Secured loan repayable on demand - -

ICD from Tata Global Beverages Limited 42, 500, 000 47, 500, 000

( E M of 2 Acres and 4 Gunt as of land bear ing Survey no 49 of Sonnapanahal l i Vi l lage,

Doddabal lapur Taluk, Bengaluru belong t o Arudrama ) -

-

Kotak Mahindra Bank STL 10, 833, 736 7, 148, 080

(Secu red by Lein on Fix ed Deposit o f ` 28 ,41 ,133 /- he ld w it h Kot ak Mah ind ra Bank and personal guaran t ee of 2 Direct ors) Credi t card Dues 2, 109, 926 2, 067, 705

Total 184 , 056 , 573 162 , 643 , 446

Part iculars


76





Amount in ` . Amount in ` .8 Trade Payables

Sundry Creditors- Mfgs. 16,072,320 12,774,762

Sundry Creditors- Others 17,940,172 13,509,349

Total 34,012,492 26,284,111

9 Other current liabilities

(a) Other payables - -

Advances f rom Customers 30,205,578 20,522,166

Statutory Liabili t ies 3,842,865 4,318,677

VAT Payable 1,051,589 814,410

TDS Payable 1,150,835 1,810,736

P F ,ESI Etc 1,640,441 1,492,265

Service Tax Payable - 201,266

Accrued Employee Liabili t ies 23,278,372 16,547,078

T A Payable 917,446 658,755

Salary Payable 22,360,926 15,888,323

Loans repayable within one year 906,872 794,291

Rent Payable 4,414,123 4,023,981

Other Current Liabili t ies 3,929,469 4,105,622

Total 66,577,279 50,311,815

10 Short-term provisions - -

(a) Provision - Others: - -

Bonus Payable 5,602,528 3,623,993

Privi lage Leave Encashment Payable 798,575 497,171

Provision for taxat ion 8,482,976 1,506,726

Total 14,884,079 5,627,890

12 Non Current Investments

Non Trade

(Quoted, At cost )

550 equity shares of Rs.10 each fully paid up

(Last year 500 equity shares of ` 10 each fully paid up)

Canara Bank Ltd(Quoted) Market Value ` 303.00 27,850 17,500

last Year ` 189.95 per share - -

(Unquoted, At cost ) - -

114 Equity Shares of ` 10000/- each in 1,262,500 1,262,500

Confederat ion for Ayurvedic Renaisance Keralam Pvt Ltd - -

Total 1,290,350 1,280,000

13 Long-Term loans and advances -

(Unsecured, considered good unless otherwise stated) -

Deposits with Govt . Authorit ies 1,022,159 978,772

Deposits with others 9,936,523 8,671,795

Income Tax advance 3,401,578 4,931,591

Proj ect Expenses 60,843,436 54,643,081

WIP Nurse Training Deferred 32,321,902 32,383,402

MAT Credit Ent it lement a/ c 8,523,358 -

Kat ra Finance Ltd, Maurit ius 162,649,460 145,816,304

Capital Advance 1,131,986 546,455

Total 279,830,402 247,971,400

Particulars


77

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78





Amount in ` . Amount in ` .

14 Inventories

(Inventory as taken, valued and certified by the management)

(At lower of cost and net realisable value)

Finished Goods 30,604,747 30,856,608

Goods in transit 1,335,931 329,956

Furnace Oil 376,419 116,486

Packing Material 3,288,537 2,488,594

Raw Material 8,505,003 7,091,325

Stores & Spares 80,718 69,074

Work in Progress 20,318,314 18,649,706

Total 64,509,669 59,601,749

15 Trade receivables

Trade receivables outstanding for a period exceeding six months from the date they

were due for payment 3,939,291 3,375,323

Other Trade receivables 44,109,776 38,517,074

Total 48,049,067 41,892,397

Note: Trade receivables include debts due from:

Directors * Nil Nil

Other officers of the Company * Nil Nil

Firms in which any director is a partner Nil Nil

Private companies in which any director is a director or member Nil Nil

16 Cash and cash equivalents

(a) Cash on hand 1,591,907 1,763,182

(b) Cheques, drafts on hand 936,743 1,435,412

(c) Balances with banks - -

(i) In Current accounts 27,840,385 16,299,841

(ii) In Deposit accounts - -

Bank Deposits with original maturity for more than 12 months 3,535,073 3,241,887

(d) Credit card Collection Due 446,869 -

Total 34,350,977 22,740,322

Of the above, the balances that meet the definition of Cash and cash equivalents as per AS 3 Cash Flow Statements is ` 34350977/- (Previous Year ` 22740322/-)

17 Short-term loans and advances

(Unsecured, considered good unless otherwise stated) -

Advance for Purchase 16,083,022 2,442,161

Other Advances 25,360,531 10,884,540

Prepaid expense 394,708 515,575

Total 41,838,261 13,842,276

Particulars




79




18 Revenue from Operat ions

(a) Sale of product s 348,353,684 286,996,957 - -

(b) Sale of services 190,867,343 199,227,148

- -

Total 539,221,027 486,224,105

(i) Sale of products comprises: - -

Sale of Ayurvedic Medicine 348,353,684 286,996,957

Total 348,353,684 286,996,957

(ii) Sale of services comprises: - -

Treat ment Income 132,501,783 131,935,512

Training Income 46,312,140 56,985,374

Regist rat ion Fees 3,603,549 2,778,653

Ot her Operat ional Income 8,449,871 7,527,610

Total 190,867,343 199,227,148

19 Other Income

Int erest Received 1,446,910 705,724

Dividend Income - 5,250

Total 1,446,910 710,974

20 Cost of materials consumed - -

Raw Material - -

Opening st ock 7,091,325 6,898,230

Add: Purchases 75,857,618 67,245,400

Less: Closing st ock 8,563,976 7,091,325

(A) 74,384,967 67,052,305 Packing Material - - Opening St ock 2,488,594 2,432,082

Add: Purchase 19,474,002 18,165,471

Less: Closing St ock 3,288,537 2,488,594

(B) 18,674,059 18,108,959 Cost of material consumed(A+B) 93,059,026 85,161,264

21 Purchase of Stock In Trade - -

Purchase of Medicines 21,184,880 8,018,673

Total 21,184,880 8,018,673

22 Changes in inventories of stock of F G, WIP & Stock in trade

Invent ories at t he end of t he year: - -


49,952,273 46,386,561

Invent ories at t he beginning of t he year: - -


46,386,561 49,116,236

Net (increase) / decrease (3,565,712) 2,729,675

23 Employee benefits expense

Salaries and wages 140,769,469 123,896,026

Cont ribut ions t o provident f unds 7,959,928 7,362,393

St af f welfare expenses 12,701,600 10,798,975

Total 161,430,997 142,057,394

Notes Part iculars


80




For the period ended

31st March, 2016 Am ou n t in ` Am ou n t in `

2 4 Finance cost s

(a) Int erest expense on:

( i ) Bor row ings 11, 500, 234 11, 468, 562

( i i ) Int erest on vehicle loans 738, 646 1, 484, 048

Tot al 1 2 , 2 3 8 , 8 8 0 1 2 , 9 5 2 , 6 1 0

2 5 De pre ciat ion e xpe nse

Depreciat ion 17, 056, 019 18, 974, 395

Am or t i sat ion of Goodw i l l and Proj ect Expenses 689, 486 903, 598

Tot al 1 7 , 7 4 5 , 5 0 5 1 9 , 8 7 7 , 9 9 3

2 6 Ot he r e xpe nse s

Rent 16, 947, 024 16, 077, 141

Bank Charges 2, 038, 536 2, 450, 633

Rat es and Taxes 2, 345, 133 2, 329, 588

Legal & Prof essional charges 6, 301, 731 14, 641, 674

Di rect ors Si t t i ng Fee 355, 000 270, 000

Research and Developm ent Expenses 342, 512 234, 662

Travel l i ng -Ot hers 2, 976, 772 3, 908, 052

Loss on sale of f i xed Asset 6, 063 9, 208

Bad Debt s 611, 983 -

Repai r s & Maint anance- Ot hers 4, 608, 223 4, 294, 469

Vehicle Maint enance 296, 093 267, 370

Insurance 620, 236 437, 309

Pr int ing & St at ionery 1, 758, 175 1, 783, 071

Post age & Telephone 3, 524, 023 3, 265, 823

Secret ar ial Expenses 1, 478, 730 1, 423, 584

Repai r s & Maint enance Branch asset s 1, 206, 643 1, 550, 049

Conveyance Expenses 1, 847, 029 841, 540

Cant een Expenses 2, 196, 305 1, 904, 390

Ot her Adm inist rat i ve Expenses 9, 039, 564 7, 831, 334

Audi t f ee 250, 134 320, 004

Travel l i ng -Sales St af f 8, 451, 069 7, 888, 624

Adver t i sem ent s 354, 941 371, 797

Com m ission & Discount 8, 857, 010 9, 691, 012

Training Expenses 10, 696, 234 9, 530, 040

Freight Out w ard 6, 524, 642 6, 166, 448

Sales prom ot ion exp 9, 534, 104 9, 031, 071

Ot her Sel l i ng & Dist r i but ion Expenses 1, 100, 328 2, 252, 303

Fuel Consum ed 2, 425, 901 3, 070, 105

Elect r i c i t y charges 2, 520, 266 2, 466, 493

Repai r s t o Plant & Machinery 1, 103, 030 984, 727

Repai r s t o Bui ld ing 4, 333, 234 2, 010, 916

Job Works 24, 987, 898 17, 432, 175

Ot her Manuf act ur ing Expenses 2, 005, 223 3, 649, 877

Cul t i vat ion Expenses 276, 636 66, 812

Treat m ent Expenses 16, 194, 404 10, 676, 157

Com put er & Int ernet Expenses 295, 626 1, 958, 973

Tot al 1 6 0 , 3 3 7 , 0 0 5 1 5 2 , 6 4 2 , 6 2 2

( i ) Paym ent s t o t he audi t ors com pr ises (net of servi ce t ax input

cred i t , w here appl i cab le) :

For com pany law m at t ers 2, 809 57, 934

Reim bursem ent of expenses 35, 325 36, 245

Tot al 2 5 0 , 1 3 4 3 2 0 , 0 0 4

Not e s Par t iculars


81



27 Consolidation

b. Details of Subsidiaries Name of the company Country of Inc. % of

Voting PowerFinancial

year

Ayurvedagram Heritage Wellness Center Pvt Ltd India 74% April-March

Ayu Natural Medicine Clinic, PS. USA 100% April-March

Ayurvedic Academy INC. USA 100% April-March

Nutraveda INC. USA 100% April-March

Nutraveda Pte Ltd Singapore 100% April-March

CMS Katra Holdings LLC * USA 81.67% April-March

CMS Katra Nursing LLC USA 100% April-March

28

Description of relationshipHolding Company

Subsidiary Companies

Companies where Promoter Director is having control/significant influence

All Seasons Herbs Pvt. Ltd.

Mason & Summers Leisure Pvt. Ltd.

Katra Phytochem India Pvt. Ltd.

Ayusante Lifecare India Pvt Ltd

Katra Holding Pvt. Ltd.

Katra Finance Ltd, Mauritius

Global AgriSystems Pvt Ltd


Nutraveda Pte Ltd

CMS Katra Holdings LLC, USA

CMS Katra Nursing LLC, USA

Katra Holdings Ltd, Mauritius

Ayurvedagram Heritage Wellness Centre Pvt Ltd

Nutraveda Inc

Ayu Natural Medicine Clinic PS, USA

a. Nutraveda Pte Ltd incorporated in Singapore on 29 th June 2009 is yet to commence business.

* CMS KatraNursing LLC, is a step down Wholly owned subsidiary of the company where CMS Katra Holdings LLC holds 51% voting power and 49% is held thru Nutraveda Inc.Principles of consolidation

1. The consolidated financial statement is based on the audited financial statements of the subsidiaries for their respective financial years.

2. The financial statement of the parent company and its subsidiaries have been combined to the extent possible on a line by line basis by adding together like items of assets, Liabilities, Income and expenses. All intra group balances and transactions have been eliminated on consolidation.

3. Minority interest in the net income and net assets of the consolidated financial statements are computed separately.

Related party transactions

Details of related parties:

Names of related parties

/




82

Director/Key Managerial Person

31st March, 2017

31st March, 2016

3,038,094 2,260,706

911,239 736,058

4,774,120 -

2,497,305 -

5,699,958 -

212,565 -

573,610 298,795

2,928,000 3,000,000

Remuneration paid to Mr Arvind Agarwal , CFO 2,877,000 4,746,845

Remuneration paid to Mr K. Raghunadhan, Company Secretary w.e.f 18/01/2017

116,719 -

Remuneration paid to Ms Itti Bhargava, Company Secretary upto 11/06/2016

107,556 391,667

13,924 -

32,368 2,942,358

- 1,302,500

- 3,314

(17,450,000) (13,177,446)

(586,476) 1,470,397

648,386 663,300

25,497,029 26,083,505

478,579,241 497,495,596

Dr K Anil Kumar, Whole time Director

Mr M C Mohan, Director

Mr Arvind Agarwal , CFO

Mr K. Raghunadhan, Company Secretary

Ms Itti Bhargava, Company Secretary

Change in Borrowings from Katra Finance Ltd, Mauritius

Balances outstanding at the end of the year

Advance- from Mr M C Mohan, Director

Borrowings- from Katra Finance Ltd, Mauritius

Borrowings- from Katra Holding Pvt Ltd

Reimbursement of Expenses by Ayusante Lifecare India Pvt Ltd

Reimbursement of Expenses by Katra Holding Pvt Ltd

Change in Borrowings from Katra Holding Pvt Ltd

Managerial Remuneration-Dr K Anilkumar

Reimbursement of Expenses by/to Katra Phytochem India Pvt Ltd

Reimbursement of Expenses by/to Mason & Summers Leisure Pvt Ltd

Purchase/Sale of Raw Materials- Katra Phytochem (India) Pvt Ltd

Rendering of services to- Global AgriSystems Pvt Ltd

Rendering of services to- Katra Holding Pvt Ltd

Rendering of services to- Katra Phytochem India Pvt Ltd

Rendering of services- Mason & Summers Leisure P Ltd

Note: Related parties have been identified by the Management.

Details of related party transactions during the ye ar ended 31 March, 2017 and balances outstanding as at 31 March, 2017:

Purchase of Raw Materials- All Season Herbs Pvt Ltd

Purchase/Sale of Raw Materials- Confederation for Ayurvedic Renaisance Keralam Ltd

Particulars


83












Sd/ - Sd/ -

Sd/ -Sd/ -

Sd/ -

1,268,500 330,897 1,599,3970 9,238,694 9,238,694

3,000 2,945,503 2,948,5031,265,500 5,556,783 6,822,283

0 1,067,305 1,067,305


84

KERALA AYURVEDA LIMITEDLIST OF HOSPITALS, TREATMENT CENTRES, CLINICS, DEPOTS, ACADEMY & HEALTH RESORT

H O SP I T A LS: I N K ER A LA K ER A LA A Y U R V ED A H O SP I T A L M O N A ST ER Y LA N E. A M R O A D A LU V A 6 8 3 1 0 1 ER N A K U LA M D I ST . P H : 0 4 8 4 2 6 2 6 1 1 9 ,2 6 2 6 9 6 6 K ER A LA A Y U R V ED A H O SP I T A L O P PO SI T E A X I S BA N K , BA N K R O A D , K A SA R AGO D E - 6 7 1 1 2 1 P H : 0 4 9 9 - 4 2 2 2 5 1 9

T R EA T M EN T CEN T R ES- I N K ER A LA K ER A LA A Y U R V ED A W ELLN ESS CEN T ER O LD W A R R I A M R O A D EA ST A .M .T H O M A S R O A D , ER N A K U LA M - 6 8 2 0 1 6 . P H : 0 4 8 4 - 2 3 7 5 2 9 2 , 2 3 7 8 1 9 8 K ER A LA A Y U R V ED A W ELLN ESS CEN T ER X X V I I / 4 7 8 , T H EJU S, O P P N A N D I LA T H G M A R T , T O LL JN , ED A P A LLY , ER N A KU LA M - 6 8 2 0 1 6 . P H : 0 4 8 4 - 2 5 5 7 2 4 4 K ER A LA A Y U R V ED A W ELLN ESS CEN T R E Z EEN , A M C V I I I / 7 3 , BA N K R O A D , A LU V A 6 8 3 1 0 1 P H :0 4 8 4 - 3 2 2 1 3 6 5 ,0 4 8 4 - 2 6 2 3 5 7 8

FR A N CH I SEE CLI N I C- K ER A LA K ER A LA A Y U R V ED A CLI N I C O P P N EW K SR T C BU S S T A N D FO R T R O AD , N O R T H P A R U R , ER N A K U LA M D I ST . P H : 0 4 8 4 - 2 4 4 5 7 1 8 CLI N I CS O U T SI D E K ER A LA K A R N A T A K A : K ER A LA A Y U R V ED A CLI N I C 1 2 , BO W R I N G H O SP I T A L R O AD , SH I V A JI N A GA R , BEN GA LU R U - 5 6 0 0 0 1 . P H : 0 8 0 - 2 5 5 9 1 8 2 5 K ER A LA A Y U R V ED A CLI N I C N 0 .2 8 5 . W H I T EFI ELD M A I N R O A D , O P P S T A T E BA N K O F M YSO R E, W H I T EFI ELD , BEN GA LU R U - 5 6 0 0 6 5 . P H : 0 8 0 - 2 8 4 5 6 2 1 2 M A H A R A SH T R A : K ER A LA A Y U R V ED A CLI N I C D I SP EN SA R Y CO M PLEX , SN M S A Y U R V ED A D I SP EN SA R Y , 3 & 4 , P R O JECT CO LO N Y , T A R A P U R , T A P P P .O - 4 0 1 5 0 4 . P H : 0 2 5 2 5 - 2 6 3 8 2 3

H EA LT H R ESO R T

A Y U R V ED A GR A M A Y U R V ED A GR A M H ER I T A GE W ELLN ESS CEN T R E P V T LT D H EM A N D A N A H A LLI , SA M ET H A N H ALLI P O ST , V I A W H I T EFI ELD , BEN GA LU R U - 5 6 0 0 6 7 . K A R N A T A K A P H : 0 8 0 - 2 7 9 4 5 4 2 8 - 3 0 , 6 5 6 5 1 0 9 0 T H E H EA LT H V I LLA GE K ER A LA A Y U R V ED A LI M I T ED M O N A ST ER Y LA N E. A M R O A D A LU V A 6 8 3 1 0 1 ER N A K U LA M D I ST . P H : 0 4 8 4 2 6 2 5 6 3 0 2 6 2 8 6 3 0

A CA D EM Y K ER A LA A Y U R V ED A A CA D EM Y M O N A ST ER Y LA N E. A M R O A D A LU V A – 6 8 3 1 0 1 . P H : 0 4 8 4 - 2 6 2 8 7 0 7 T R EA T M EN T CEN T R ES- O U T SI D E K ERA LA K ER A LA A Y U R V ED A W ELLN ESS CEN T ER A D 2 0 ( P LO T N O .3 3 3 7 ) 5 t h A V EN U E, A N N A N A GA R , CH EN N A I - 6 0 0 0 4 0 . T A M I L N A D U P H : 0 4 4 - 2 6 2 1 4 9 0 3 K ER A LA A Y U R V ED A W ELLN ESS CEN T ER N o 3 2 8 2 , 1 2 T H M A I N , H A L I I N D ST A GE, I N D I R A N A GA R , BEN GA LU R U - 5 6 0 0 3 8 . K A R N A T A K A P H : 0 8 0 - 2 5 2 6 2 5 1 5 , K ER A LA A Y U R V ED A W ELLN ESS CEN T ER # 4 0 0 , 1 8 T H M A I N , 6 T H BLO CK , K O R A M A N GA LA , BEN GA LU R U - 5 6 0 0 9 5 . , K A R N A T A K A P H : 0 8 0 - 4 1 6 9 9 6 9 9 K ER A LA A Y U R V ED A W ELLN ESS CEN T ER 4 5 1 G r o u n d F lo o r 7 t h M a in , 4 t h b lo ck JA Y A N A GA R , Be n g a lu r u 5 6 0 0 1 1 P H :0 8 0 - 2 6 6 5 9 4 5 5 K ER A LA A Y U R V ED A W ELLN ESS CEN T ER 6 - 3 - 0 9 0 6 / B/ 1 , SO M A JI GU D A N EA R Y A SO D A S P ECI A LI T Y H O SP I TA L H Y D ER A BA D - 5 0 0 0 8 2 . A N D H R A P R A D ESH P H : 0 4 0 - 6 6 6 1 3 3 5 7 K ER A LA A Y U R V ED A P A N CH A K A R M A CEN T ER S I R SU N D ER LA L H O SP I T A L, BA N A RA S H I N D U U N I V ER SI T Y , V A R A N A SI - 2 2 1 0 0 5 , U T T A R P R AD ESH P H : 0 5 4 2 - 6 5 4 0 9 8 0 , 9 2 3 5 5 - 0 2 8 4 7 FR A N CH I SEE W ELLN ESS CEN T ER S K ER A LA A Y U R V ED A W ELLN ESS CEN T ER E- 2 , GR EEN P A R K EX T N , GR EEN P A R K M A I N M A R K ET R O A D , N EW D ELH I - 1 1 0 0 1 6 . D ELH I P H : 0 1 1 - 4 1 7 5 4 8 8 8 / 4 1 7 5 9 3 4 7 K ER A LA A Y U R V ED A W ELLN ESS CEN T ER A A R O GYA M ,5 2 ,D H U LESH W A R BAGH SA R D A R PA T EL M A R G, C- SCH EM E, JA I P U R – 3 0 2 0 0 1 .R A JAST H A N P H : 0 1 4 1 - 4 0 2 2 4 2 2 FA CT O R Y O U T LET K ER A LA A Y U R V ED A LI M I T ED FA CT O R Y O U T LET V I I / 4 1 5 , N ED U M BA SSER Y A T H A N I P .O . , A LU V A – 6 8 3 5 8 5 . P H : 0 4 8 4 - 2 4 7 6 3 0 1

FO R AN Y I N FO R M AT I O N PLEA SE

W R I T E T O in fo@k e r a la a y u r v e d a .b iz

D EP O TS I N K ER A LA : K ER A LA A Y U R V ED A D EPO T SH O P N O .2 / 1 4 0 2 , M A R K ET R O A D - K A RA P A R A M BU CA LI CU T ( K O Z H I KO D E) - 6 8 0 0 1 4 P H : 9 5 6 2 5 0 8 4 2 0 K ER A LA A Y U R V D A D EPO T 9 / 2 8 5 M , P A N A Y I KK U LA M P O A LA N GA D , ER N A KU LA M 6 8 3 5 1 1 P H : 0 4 8 4 - 2 6 7 2 7 3 0 D EP O T O U T SI D E K ER A LA :

K ER A LA A Y U R V ED A D EPO T 6 - 3 - 9 0 6 / B / 1 , 1 ST FLO O R , SO M A JI GU D A BEH I N D Y A SO D A SP ECI A LI T Y H O SPI T A L H Y D ER A BA D - 5 0 0 0 8 2 . P H : 0 4 0 - 6 6 6 1 3 3 5 7 K ER A LA A Y U R V ED A D EPO T SH O P N O .6 / 7 / 8 / 9 / 1 0 JA I GU R U D EV CO - O P .H O U SI N G SO CI ET Y P LO T N O .1 0 6 B, SECTO R N EW 5 0 E SEA W O O D ( W ) N A V I M U M BA I – 4 0 0 7 0 6 P H : 0 2 2 - 6 0 0 2 1 0 2 1 K ER A LA A Y U R V D A D EPO T P LO T N O .2 0 0 / 2 , G R O U N D FLO O R N EA R GA U T H A M A P A R T M EN T S GA U T H A M N A GA R N EW D ELH I - 1 1 0 0 4 9 P H :0 1 1 - 4 1 6 1 8 8 8 4 K ER A LA A Y U R V ED A D EPO T 3 8 , D EH GA M JA I N SO CI ET Y , K A SH I B R O AD , R A N I P , A H M ED A BA D - 3 8 0 0 1 4 P H : 0 7 9 - 2 7 5 4 0 2 6 3 K ER A LA A Y U R V ED A D EPO T 2 6 ,SR I SA I R A M ST R EET , P A N EER N A GA R , M O GA P P A I R , CH EN N A I - 6 0 0 0 3 7 . T A M I L N A D U P H : 0 4 4 - 2 6 5 6 0 2 1 7 , 9 8 8 4 4 8 5 1 6 1 K ER A LA A Y U R V ED A D EPO T N O .1 8 ,T A GO R E N A GA R SBI O FFI CER S I I I CO LO N Y SS CO LO N Y - M A D U R A I M A D U R A I - 6 2 5 0 1 0 , T A M I L N A D U P H : 0 4 5 2 - 2 6 0 6 3 7 3 K ER A LA A Y U R V ED A D EPO T N O .6 7 , 1 ST FLO O R SR EEK U M A R A GI R I 1 2 T H M A I N , 2 6 T H CR O SS 2 N D BLO CK , R A JA JI N A GA R BA N GA LO R E – 5 6 0 0 1 0 K ER A LA A Y U R V ED A D EPO T B3 6 / 9 C, SA N K A T M O CH A N - LA N K A , V A R A N A SI , U T T A R P R A D ESH - 2 2 1 0 0 5 K ER A LA A Y U R V ED A D EPO T 1 1 4 , R a b in d r a sa r a n i Ba n g u r e Bu i ld in g 1 s t F lo o r , R o o m N o .1 7 - C K o lk a t t a , W e st Be n g a l P I N : 7 0 0 0 0 7 P H : 0 3 3 - 2 2 7 2 3 0 1 5

P R O D U CTS A RE A LSO A V A I LA BLE O N LI N E A T w w w . K e r a la a y u r v e d a .b iz


85

Attendance Slip

Folio No./DPID No.& Client ID No. :

Name of the shareholder(s) :

No. of shares :th thI/We hereby record my/our presence at the 25 ANNUAL GENERAL MEETING of the company on Wednesday , the 27 September, 2017 at 3:30 P.M

at Green Park Auditorium, Desom, Aluva-683 103.

Signature of the Attending Member Signature of the ProxyNotes:

1. Shareholders/Proxy holders who wish to attend the meeting are requested to bring this Attendance Slip to the meeting and hand it over at the entrance duly signed.

2. Shareholders/Proxy holders should bring their copy of the Annual Report for the meeting. 3. Shareholders desiring to appoint proxies to attend the meeting are requested to send the attached proxy form, duly completed and signed, to

reach the Secretarial Department, Kerala Ayurveda Ltd, VII/415, Nedumbassery, Athani P.O, Aluva 683 585 not less than 48 hours before the commencement of the meeting.

4. The registration at venue shall be from 3:00 pm to 3:30 pm strictly.

KERALA AYURVEDA LIMITEDRegd. Off: VII/415, Nedumbassery, Athani P.O, Aluva-683585, Kerala.

CIN:L24233KL1992PLC006592

ANNUAL GENERAL MEETING

Form No.MGT-11Proxy Form

(Pursuant to Section 105(6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration) Rules, 2014)

CIN : L24233KL1992PLC006592 Name of the Company : KERALA AYURVEDA LIMITED

Regd. Off: VII/415, Nedumbassery, Athani P.O, Aluva-683585, Kerala.Ph: 0484-2476301(4 lines) Fax: 0484-2474376 Email: [email protected] Website: www.keralaayurveda.biz

Name of the Member(s) :Registered Address :E-mail Id :Folio No./Client Id &DP. Id :

I/We, being the member (s) of Kerala Ayurveda Lltd., holding ................... shares of the above named company, hereby appoint

as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 25th Annual general meeting of the company, to be held on 2017 at 3.30 p.m.at Green Park Auditorium, Desom, Aluva-683103 and at any adjournment thereof in respect of such resolutions as are indicated below:

th Wednesday , the 27 September,

1.Name: ...........................................................................................................Address:.............................................................................................

........................................................................................................................................ E-mail Id: ...........................................................................

Signature:................,………………............................................................................... or failing him

2.Name: ...........................................................................................................Address:.............................................................................................

........................................................................................................................................ E-mail Id: ...........................................................................


3.Name: ...........................................................................................................Address:.............................................................................................

........................................................................................................................................ E-mail Id: ...........................................................................


st1. Adoption of the Audited Financial Statements (including consolidated financial statements) of the company for the financial year ended 31 March, 2017 together with

the Reports of the Board of Directors and the Auditors thereon.

2. Appointment of a Director in place of Mr. Ramesh Vangal, (DIN 00064018) who retires by rotation and being eligible, offers himself for re-appointment.

3. To ratify the appointment of M/s Biju George & co.,Chartered Accountants as Statutory Auditors of the company to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting and to authorize the Board to fix their remuneration.

4. Appointment of Mr.Anand Subramanian, (DIN 00064083) as Non Executive Director.

5. Execution of agreement with Ayurvedagram for the sale of Medicines with a discount upto 15% on MRP for a period of 3 years with effect from 1.4.2017.

6. Increase in Borrowing power.

Affix Re.1/-Revenue

Stamp

Signed this …………………………………..day of…………..2017

Signature of shareholder(s) ....................................................................

Signature of Proxy holder(s) ...................................................................

1. A shareholder may vote either for or against each resolution.2. This form of proxy should be duly completed and must be deposited at the Secretarial Department, KERALA AYURVEDA LIMITED, Regd.

Off: VII/415, Nedumbassery, Athani P.O, Aluva-683585 not less than 48 hours before the commencement of the meeting.

THIS COUPON ENTITLES YOU TO PURCHASE KAL’S MEDICINE S FROM THE COMPANY’S DIRECT OUTLETS (REFER PAGE 84) AT 15% DISCOUNT

15%

DIS

COU

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ON

M.R

.P. `

250

/- Name..................................................................

Signature.............................................................

Folio No.............................................................

VALID UPTO 31.03.2018

15%

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M.R

.P. `

250

/- Name..................................................................

Signature.............................................................

Folio No.............................................................

VALID UPTO 31.03.201815

% D

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.R.P.

` 2

50/- Name..................................................................

Signature.............................................................

Folio No.............................................................


15%

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.P. `

250

/- Name..................................................................

Signature.............................................................

Folio No.............................................................


TO KOCHI - ALUVA

BENZ SHOWROOM

NH - 47

MangalapuzhaBRIDGE

Venue for AGM

HYUNDAISHOWROOM

GREENPARK

DESOM JN

TO KALADYO

KANJOR

OCH

WW

ARA

O KAM

TAN

ALY

TO TS

R

HRI SU

TO AIR PORT

HAT

ANI

KERALA AYURVEDA LTD.

Route Map


87

Documents

Kerala Ayurveda Ltd.. M C Mohan, Independent Director (DIN 00633439) Mr. S Krishnamurthy, Independent Director (DIN 00140414) Mr. Kshiti Ranjan Das, Independent Director (DIN 07212449)