Dividend Distribution Policy
1. Purpose______________________________________1
2. Objective_____________________________________1
3. Philosophy ___________________________________1
4. Definitions____________________________________1
5. Parameters for Declaration of Dividend _____________2
6. Circumstances under which the Shareholders may or may not expect Dividend ________________________________3
7. Utilization of retained earnings _____________________3
8. Parameters adopted with regard to various classes of shares __3
9. Disclosures ____________________________________3
10. Policy Review __________________________________4
11. Scope and Limitation_____________________________4
1. Purpose: -
The purpose of this Dividend Distribution Policy is to establish clear guidelines for the declaration and distribution of dividends to shareholders of Alpa Laboratories Limited ("the Company") in a fair and transparent manner. This policy is formulated in compliance with the provisions of the Companies Act, 2013 and the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR), as amended from time to time.
2. Objective: -
Objective of the policy is to provide transparent and fair framework for determination of profits to be distributed to the shareholders and the profits to be ploughed back in to business for its future growth. Board of Directors shall endeavour to enhance shareholders’ value through dividend distribution after taking in to consideration operating performance of the Company and future capital requirements for growth and expansion plans.
The policy lays down the parameters and different circumstances that needs to be considered by the Board at the time of taking the decision for distribution and/ or retention of profits.
3. Philosophy: -
The Philosophy of the Company is to maximise Company’s shareholders wealth in the Company through various means. The Company would first utilise its profits for working capital requirements, capital expenditure needs, debt repayment, creation of reserves for inorganic growth opportunities and thereafter will distribute the surplus profits in the form of dividend to the shareholders.
4. Definitions: -
For the purpose of this Policy, the following terms will have the meaning described below, unless the context otherwise requires:
❖ “Act” means the Companies Act, 2013 and the Rules framed thereunder, including any modifications, amendments, clarifications, circulars or re-enactment thereof.
❖ “Applicable Law” means the Companies Act, 2013 and the rules made thereunder, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI LODR”) and such other acts, rules or regulations which govern the distribution of Dividend; as amended from time to time.
❖ “Board” or “Board of Directors” means the collective body of the Directors of the Company.
❖ “Company” means Alpa Laboratories Limited.
❖ “Dividend” means dividend on equity shares of the Company and includes interim dividend.
❖ “Policy” means this Dividend Distribution Policy of the Company.
All the words and expression used in this Policy, unless defined in the Policy, shall have the same meaning respectively assigned to them under the Applicable Laws.
5. Parameters for Declaration of Dividend: -
In line with the philosophy stated above, the Board of Directors of the Company shall Consider the following parameters for Declaration of Dividend:
v Financial Parameters / Internal Factors:
¨ Consolidated net profit after tax;
¨ Working Capital requirements;
¨ Capital expenditure requirements;
¨ Resources required to fund acquisitions and / or new businesses;
¨ Cash flow required to meet contingencies;
¨ Repayment obligation of outstanding borrowings;
¨ Past Dividend Payment trends;
¨ Business outlook / uncertainty in external environment;
¨ Liquidity and return ratios;
¨ Any other significant developments that require cash investments.
These are general indicative financial parameters. The Board may consider other financial parameters which may not be covered above.
v External Factors:
¨ Any significant changes in macro-economic environment affecting India or the geographies in which the Company operates, or the business of the Company or its clients;
¨ Dividend pay-out ratios of companies in the same industry with comparable business mix and growth outlook;
¨ Any political, tax (including rate of Income Tax and dividend distribution tax) and regulatory changes in the geographies in which the Company operates;
¨ Any significant change in the business or technological environment resulting in the Company making significant investments to effect the necessary changes to its business model;
¨ Any change to the Competitive environment requiring significant investment.
The Board may consider other external factors, which may not be covered above.
6. Circumstances under which the Shareholders may or may not expect Dividend: -
The Shareholders of the Company may not expect dividend under the following circumstances:
Ø Higher working capital requirements for business operations of the Company;
Ø Whenever the Company undertakes or proposes to undertake a significant expansion project requiring higher allocation of Capital;
Ø Whenever the Company undertakes or proposes to undertake any acquisition, joint venture, expansion, new business or other growth opportunities or threats / concerns of the Company;
Ø Whenever the Company proposes to utilise surplus cash for buy back of securities;
Ø In the event of inadequacy of profits or whenever the Company has incurred losses;
Ø Business outlook and uncertainties that may impact business and profitability of the Company.
However, the final decision for declaring dividend vests with the Board, who may, decide
to declare dividend despite existence of the above circumstances.
7. Utilization of retained earnings: -
The Board may retain its earnings in order to make better use of the available funds and increase the value of the stakeholders in the long run. The decision of utilization of the retained earnings of the Company shall be based on the following factors:
§ Market expansion plan:
§ Product expansion plan;
§ Increase in production capacity;
§ Modernization plan;
§ Diversification of business;
§ Long term strategic plans;
§ Replacement of capital assets;
§ Where the cost of debt is expensive;
§ Other such criteria as the Board may deem fit from time to time.
8. Parameters adopted with regard to various classes of shares: -
The provisions contained in this policy shall apply to all the classes of Shares of the Company. However, currently the Company has only one class of Shares, namely Equity Shares. As and when the Company issues other kind of shares, the Board of Directors may suitably amend this Policy.
9. Disclosures: -
- The Company shall make appropriate disclosures as required under the SEBI (LODR) Regulations.
- The Dividend Distribution Policy shall be disclosed on the Website of the Company and the weblink of the same shall be provided in the Annual Reports of the Company.
10. Policy Review: -
This Dividend Distribution Policy will be reviewed by the Board of Directors periodically to ensure its alignment with the Company’s long-term strategy, financial position, regulatory framework, and evolving business conditions.
11. Scope and Limitation: -
- This Policy would be subject to revision / amendment in accordance with the guidelines as may be issued by Ministry of Corporate Affairs, Securities Exchange Board of India or such Other regulatory authority, from time to time;
- In case of any amendments, clarifications, circulars etc issued by the relevant authorities, not being consistent with the provisions laid down under this policy, then such amendments, clarifications, circulars etc shall prevail upon the provisions of this policy shall automatically stand amended accordingly.
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