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Piramal Enterprises Chairman Ajay Piramal on Friday sought to allay apprehensions about the appointment of independent directors to the company’s board.
The 10-year period that an independent director can be with a company has been outlined by the new Companies Act, and it is effective for the future, Piramal told the company’s annual shareholders meeting.
The clarification comes against the backdrop of a report in a national business daily that proxy advisers wanted shareholders to reject the appointment of some of the independent directors to the board, as they had already been associated long enough with the company.
Pointing out that the new law was not retrospective in nature, Piramal said it did not refer to the appointment of people who have an existing association with the company.
The company will be in full compliance with the new Companies Act, he added.
Some of the independent directors being appointed are S Ramadorai, Narayanan Vaghul, RA Mashelkar and Keki Dadiseth.
On the business prospects for the current year, Piramal said he expected the company’s pharmaceuticals business to turn profitable.
The pharmaceuticals business involves custom manufacturing products for overseas clients and the economic environment had not exactly been conducive. But this year will be positive, he said.
Unlike their short-term investments such as the Vodafone stake which it sold for a healthy return , the investment in pharma research is for a long term, the Chairman said. The company expects revenues in the current year from Florbetaben, a tracing agent that under a PET scan helps diagnose early stage Alzheimer's disease. . In the coming year or next, the company would look to license out one of its molecules to multinationals for further development.
On the company’s investment in the Shriram Group’s financial services business, Piramal said the group had been consistently outperforming. Asked if Shriram Capital is seeking a banking licence, he said there was no plan at the moment. “Some rules are changing and if it suits their purpose, they may look at it.”
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