(n) Provisions, Contingent Liabilities and Contingent Assets
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result
of a past event and it is probable that an outflow of resources, that can be reliably estimated, will be
required to settle such an obligation.
If the effect of the time value of money is material, provisions are determined by discounting the
expected future cash flows to net present value using an appropriate pre-tax discount rate that reflects
current market assessments of the time value of money and, where appropriate, the risks specific to the
liability. Unwinding of the discount is recognised in the Statement of Profit and Loss as a finance cost.
Provisions are reviewed at each reporting date and are adjusted to reflect the current best estimate.
A present obligation that arises from past events where it is either not probable that an outflow of
resources will be required to settle or a reliable estimate of the amount cannot be made, is disclosed as
a contingent liability. Contingent liabilities are also disclosed when there is a possible obligation arising
from past events, the existence of which will be confirmed only by the occurrence or non -occurrence
of one or more uncertain future events not wholly within the control of the Company.
Claims against the Company where the possibility of any outflow of resources in settlement is remote,
are not disclosed as contingent liabilities.
Contingent assets are not recognised in financial statements since this may result in the recognition of
income that may never be realised. However, when the realisation of income is virtually certain, then
the related asset is not a contingent asset and is recognised.
(o) Borrowing costs
Borrowing costs are interest and other costs that the Company incurs in connection with the borrowing
of funds and is measured with reference to the effective interest rate (EIR) applicable to the respective
borrowing. Borrowing costs include interest costs measured at EIR and exchange differences arising
from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.
Borrowing costs, allocated to qualifying assets, pertaining to the period from commencement of
activities relating to construction / development of the qualifying asset up to the date of capitalisation
of such asset are added to the cost of the assets. Capitalisation of borrowing costs is suspended and
charged to the Statement of Profit and Loss during extended periods when active development activity
on the qualifying assets is interrupted.
All other borrowing costs are recognised as an expense in the period which they are incurred.
(p) Segment Reporting - Identification of Segments
An operating segment is a component of the Company that engages in business activities from which
it may earn revenues and incur expenses, whose operating results are regularly reviewed by the
company's chief operating decision maker to make decisions for which discrete financial information
is available. Based on the management approach as defined in Ind AS 108, the chief operating decision
maker evaluates the Company's performance and allocates resources based on an analysis of various
performance indicators by business segments and geographic segments.
(q) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing:
- the profit attributable to owners of the company
- by the weighted average number of equity shares outstanding during the financial year, adjusted for
bonus elements in equity shares issued during the year
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to
take into account:
- the after income tax effect of interest and other financing costs associated with dilutive potential
equity
- the weighted average number of additional equity shares that would have been outstanding
assuming the conversion of all dilutive potential equity shares.
(r) Cash and cash equivalents
Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term
deposits with an original maturity of three months or less, which are subject to an insignificant risk of
changes in value.
For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and short¬
term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral
part of the Company's cash management.
(s) Non-current assets (or disposal groups) classified as held for disposal:
Assets are classified as held for disposal and stated at the lower of carrying amount and fair value less
costs to sell.
To classify any Asset as "Asset held for disposal" the asset must be available for immediate sale and its
sale must be highly probable. Such assets or group of assets are presented separately in the Balance
Sheet, in the line "Assets held for disposal". Once classified as held for disposal, intangible assets and
PPE are no longer amortised or depreciated.
(t) Current/non current classification
The Company presents assets and liabilities in the balance sheet based on current/ non-current
classification. An asset is treated as current when it is:
- Expected to be realised or intended to be sold or consumed in normal operating cycle
- Held primarily for the purpose of trading
- Expected to be realised within twelve months after the reporting period, or
- Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at
least twelve months after the reporting period
All other assets are classified as non-current.
A liability is current when:
- It is expected to be settled in normal operating cycle
- It is held primarily for the purpose of trading
- It is due to be settled within twelve months after the reporting period, or
- There is no unconditional right to defer the settlement of the liability for at least twelve months
after the reporting period
The company classifies all other liabilities as non-current.
Deferred tax assets and liabilities are classified as non-current assets and liabilities.
The operating cycle is the time between the acquisition of assets for processing and their realisation
in cash and cash equivalents. The company has identified twelve months as its operating cycle.
(u) Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no
longer at the discretion of the entity, on or before the end of the reporting period but not distributed
at the end of the reporting period.
(v) Rounding of amounts
All amounts disclosed in the financial statements and notes have been rounded off to the nearest Lakh
as per the requirement of Schedule III, unless otherwise stated.
3 Critical accounting judgments, estimates and assumptions
The preparation of financial statements requires the use of accounting estimates which, by definition, will
seldom equal the actual results. Management also needs to exercise judgement in applying the company's
accounting policies.
This note provides an overview of the areas that involved a higher degree of judgement or complexity,
and of items which are more likely to be materially adjusted due to estimates and assumptions turning
out to be different than those originally assessed. Detailed information about each of these estimates and
judgements is included in relevant notes together with information about the basis of calculation for each
affected line item in the financial statements.
Critical estimates and judgements
The areas involving critical estimates or judgements are:
- Estimation of current tax expense and payable - Note 12
- Estimated fair value of unlisted securities and Debt Instruments - Note 37
- Estimated goodwill impairment - Note 5
- Estimated useful life of intangible asset - Note 5
- Estimation of defined benefit obligation - Note 32
- Estimation of provision for warranty claims - Note 19
- Estimation of fair values of contingent liabilities and contingent purchase consideration in a business
combination - Note 37
- Recognition of revenue - Note 21
- Recognition of deferred tax assets for carried forward tax losses - Note 12
- Impairment of trade receivables and other financial assets - Note 38
Estimates and judgements are continually evaluated. They are based on historical experience and other
factors, including expectations of future events that may have a financial impact on the company and
that are believed to be reasonable under the circumstances.
ii. Property, Plant and Equipment pledged as security against borrowings by the company
Refer to Note 40 for information on property, plant and equipment pledge as security by the Company.
iii. Deferral/Capitalisation Of Exchange Differences
The Ministry of Corporate Affairs (MCA) has issued the amendment dated December 29, 2011 to AS 11
'The Effects of Changes in Foreign Exchange Rates' , to allow companies deferral/capitalization of exchange
differences arising on long-term foreign currency monetary items. In accordance with the amendment/
earlier amendment to AS 11 read with Para D13AA of Ind AS 101 'First time adoption of Indian Accounting
Standard', the Company has capitalised exchange loss, 'arising on long-term foreign currency loan to the cost
of plant and equipment.
iv. Assets under Construction
Capital work in progress mainly comprises new building and manufacturing unit being constructed in India.
v. Contractual Obligations
Refer to Note 34 for disclosure of contractual commitments for the acquisition of property, plant and
equipment.
vi. Execution of conveyance and other documents in respect of Office Premises purchased for Rs. 91.00 lakhs
in an earlier year are yet pending. The relevant expenses pertaining to the same will be accounted in the
year of execution. Amount not ascertainable.
vii. Execution of conveyance and other documents in respect of Training Centre Premises at Goregaon
purchased for Rs. 106.35 lakhs in an earlier year are yet pending. The relevant expenses pertaining to the
same will be accounted in the year of execution. Amount not ascertainable.
(1) NON CURRENT BORROWINGS
(i) SECURED BORROWING
(A) TERM LOANS FROM BANKS
(i) Secured by NCGTC [National Credit Guarantee Trustee Company Ltd] guarantee and 2nd charge on the
assets of the Company.
(ii) Capex Loan-Secured by Pari passu charge on assets created out of Term Loan.
Terms of Repayment
(I) Term Loan from Union Bank of India of INR 232 lakhs repayable in 36 monthly instalments commencing
from December 2023.
(II) Term Loan from Bank of Baroda of INR 274 lakhs repayable in 36 monthly instalments commencing from
December 2023.
(III) Capex Term Loan from Bank of Baroda of INR 1375 lakhs repayable in 24 Step up Quarterly instalments
after 12 months from the First disbursement.
(IV) Capex Term Loan from Union Bank of India of INR 1625 lakhs repayable in 24 Step up Quarterly
instalments after 12 months from the First disbursement.
(V) Capex Term Loan (TCI Pump) from Union Bank of India of INR 1125 lakhs repayment schedule awaited
from Bank.
(B) LONG TERM MATURITIES OF FINANCE LEASE OBLIGATION
Secured By hypothecation of vehicles acquired under hire purchase arrangement.
Repayable in 36/60/84 equated Monthly Installments as per various arrangements.
(ii) UNSECURED BORROWING
(A) TERM LOAN
Company has a foreign currency loan from its foreign promoter which has been rescheduled and is repayable
in 22 quarterly installments up to March 31, 2027.
(B) TERM LOAN
Company has received interest free loan from Cipla Limited which is repayable in 6 yearly instalments up to
March 31, 2026.
(2) CURRENT BORROWINGS
(i) SECURED BORROWING
Cash Credit facility from banks
Cash Credits against hypothecation of raw materials, Stock in Process, finished goods, packing material and book
debts and secured by an equitable mortgage created by deposit of title deeds of the company's Factory,Land
and Buildings situated at Vapi,Hyderabad,Haridwar and Baroda and Hypothecation of Plant and Machinery
both present and future and also secured by personal gurantees of the Directors of the Company.
30. RESEARCH AND DEVELOPMENT COSTS
The Company during the period has incurred cost on research and development activities which are not eligible for
capitalisation in terms of Ind AS 38 and therefore they are recognised in other expenses under statement of profit and
loss. Amount charged to profit or loss during the year ended March 31, 2025: INR 1,320.51 Lakhs (March 31, 2024: INR
1,279.36 Lakhs), Amount charged to Capital Account during the year ended March 31, 2025 : INR NIL (March 31, 2024 :
INR 89.35 Lakhs) details of which are as follows:
(i) Leave Obligations
The leave obligations cover the company's liability for sick and earned leave.
The amount of the provision of INR 27.10 Lakhs (March 31, 2024: INR 30.38 Lakhs) is presented as current,
since the company does not have an unconditional right to defer settlement for any of these obligations.
(ii) Post Employment obligations
a) Gratuity
The company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972.
Employees who are in continuous service for a period of five years are eligible for gratuity. The amount
of gratuity payable on retirement/ termination is the employees last drawn basic salary per month
computed proportionately for 15 days salary multiplied by number of years of service.
The gratuity plan is a funded plan and the company makes contributions to recognised funds in India.
The company does not fully fund the liability and maintains a target level of funding to be maintained
over a period of time based on estimations of expected gratuity payments.
The average duration of the defined benefit plan obligation at the end of the reporting period is 11 years (March 31,
2024: 11 years)
b) Defined contribution plans
The company also has defined contribution plans. Contributions are made to provident fund in India for
employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered
provident fund administered by the government. The obligation of the company is limited to the amount
contributed and it has no further contractual nor any constructive obligation. The expense recognised during
the period towards defined contribution plan is INR 508.13 Lakhs (March 31, 2024: INR 414.19 Lakhs)
33. SHARE BASED PAYMENTS
(a) Employee option plan
The Company implemented Themis Medicare Employee Stock Option Scheme 2012 (herein after
referred to as "Themis Medicare ESOS 2012" or "the Scheme") as approved by the Shareholders of the
Company and the Nomination and Remuneration Committee of the Board of Directors.
The purpose of this Scheme is to promote the success of the Company and its subsidiaries and the
interest of its shareholders by rewarding, attracting, motivating, and retaining Employees for high levels
of individual performance, for efforts to improve the financial performance of the Company.
The Employee Stock Option Plan (ESOP) is designed to provide incentives to eligible employees to
deliver long term returns. Under the plan, participants are granted options which vest upon completion
of 1 year of service from the grant date. Participation in the plan is at the board's discretion and no
individual has a contractual right to participate in the plan or to receive any guaranteed benefits.
Once vested, the options remain exercisable for a period of 5 years. When exercisable, each option is
convertible into one equity share.
(v) Terms and conditions of transactions with related parties
The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm's length
transactions. Outstanding balances at the year end are unsecured and interest free and settlement occurs in cash. For the
year ended March 31, 2025, the Company has not recorded any impairment of receivables relating to amount owed by
related parties (March 31, 2024: NIL). This assessment is undertaken each financial year through examining the financial
position of the related party and market in which the related party operates.
36. SEGMENT REPORTING
The company primarily operates in one business segment only i.e. Pharmaceuticals, which is the only reportable segment.
There is no other segment which requires reporting as per Ind AS 108 "Operating Segments".
The management assessed that the fair value of cash and cash equivalent, trade receivables, trade payables,
and other current financial assets and liabilities approximate their carrying amounts largely due to the short
term maturities of these instruments.
The fair values of non current borrowings are based on discounted cash flows using a current borrowing rate.
They are classified as level 3 fair values in the fair value hierarchy due to the use of unobservable inputs,
including own credit risk.
ii. Fair Value Hierarchy
This section explains the judgements and estimates made in determining the fair values of the financial
instruments that are recognised and measure at fair value. To provide an indication about the reliability of
the inputs used in determining fair value, the company has classified its financial instruments into three
levels prescribed under the accounting standard. An explanation of each level follows underneath the table:
There have been no transfers among Level 1, Level 2 and Level 3 during the period
Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed
equity instruments, mutual funds that have quoted price. The fair value of all equity instruments which are
traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are
valued using the closing NAV.
Level 2 - The fair value of financial instruments that are not traded in an active market is determined using
valuation techniques which maximise the use of observable market data and rely as little as possible on entity-
specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is
included in level 2.
Level 3 - If one or more of the significant inputs are not based on observable market data, the instrument is
included in level 3.
iii. Valuation technique used to determine fair value
Specific Valuation techniques used to value financial instruments include:
- the use of quoted market prices or dealer quotes for similar instruments
- the fair value of the remaining financial instruments is determined using discounted cash flow analysis
The fair value of unquoted equity instruments and unquoted bonds is not significantly different from their
carrying value and hence the management has considered their carrying amount as fair value.
iv. Valuation processes
The finance department of the company includes a team that performs the valuations of financial assets and
liabilities required for financial reporting purposes, including level 3 fair values. This team reports directly to
the chief financial officer (CFO) and the audit committee (AC). Discussions of valuation processes and results
are held between the CFO, AC and the valuation team at least once every three months, in line with the
company's quarterly reporting periods.
38. FINANCIAL RISK MANAGEMENT
The Company's activity exposes it to market risk, liquidity risk and credit risk. Company's overall risk management
focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the
financial performance of the company. This note explains the sources of risk which the entity is exposed to and
how the company manages the risk.
(A) Credit risk
Credit risk is the risk that the counterparty will not meet its obligations leading to a financial loss. Credit risk
arises from cash and cash equivalents, financial assets carried at amortised cost and deposits with banks
and financial institutions, as well as credit exposures to customers including outstanding receivables.
i. Credit risk management
Credit risk has always been managed by the company through credit approvals, establishing credit limits
and continuously monitoring the creditworthiness of customers to which the company grants credit
terms in the normal course of business.
The company considers the probability of default upon initial recognition of asset and whether there
has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To
assess whether there is a significant increase in credit risk the Company compares the risk of a default
occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition.
It considers available reasonable and supportive forwarding-looking information.
In general, it is presumed that credit risk has significantly increased since initial recognition if the
payments are more than 30 days past due.
A default on a financial asset is when the counterparty fails to make contractual payments of when
they fall due. This definition of default is determined by considering the business environment in which
entity operates and other macro-economic factors.
(B) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become
due. The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient
liquidity to meet its liabilities when due. The Company consistently generated sufficient cash flows from
operations to meet its financial obligations. Also, the Company has unutilized credit limits with banks.
Management monitors rolling forecasts of the company's liquidity position (comprising the undrawn
borrowing facilities) and cash and cash equivalents on the basis of expected cash flows. In addition, the
company's liquidity management policy involves projecting cash flows and considering the level of liquid
assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external
regulatory requirements.
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because
of change in market prices. Market risk comprises three types of risk: foreign currency risk, interest rate risk
and other price risk such as commodity risk.
(i) Foreign currency risk
Foreign currency risk is the risk of impact related to fair value or future cash flows of an exposure in
foreign currency, which fluctuate due to changes in foreign exchange rates. The Company's exposure to
the risk of changes in foreign exchange rates relates primarily to the external commercial borrowings
and export receivables.
The Company evaluates exchange rate exposure arising from foreign currency transactions and follows
established risk management policies and standard operating procedures to mitigate the risks.
(a) The Company's exposure to foreign currency risk at the end of the reporting period expressed in INR lakhs,
are as follows
The Company's main interest rate risk arises from long-term borrowings with variable rates, which
expose the Company to cash flow interest rate risk. Company policy is to maintain most of its borrowings
at fixed rate using interest rate swaps to achieve this when necessary. During March 31, 2025 and March
31, 2024, the company's borrowings at variable rate were mainly denominated in USD.
The company's fixed rate borrowings are carried at amortised cost. They are therefore not subject to
interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows
will fluctuate because of a change in market.
(a) Interest rate risk exposure
The exposure of the company's borrowing to interest rate changes at the end of the reporting period
are as follows:
(iii) Commodity Price risk
The Company's operating activities involve purchase and sale of Active Pharmaceutical Ingredients
(API), whose prices are exposed to the risk of fluctuation over short periods of time. Commodity price
risk exposure is evaluated and managed through procurement and other related operating policies.
As of March 31, 2025 and March 31, 2024 the Company had not entered into any material derivative
contracts to hedge exposure to fluctuations in commodity prices.
39. CAPITAL MANAGEMENT
For the purpose of the company's capital management, capital includes issued equity capital, share premium
and all other equity reserves attributable to the equity holders of the Company. The primary objective of the
Company's capital management is to maximise the shareholder value.
The company manages its capital structure and makes adjustments in light of changes in economic conditions
and the requirements of the financial covenants. To maintain or adjust the capital structure, the company
may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The
company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The
Company includes within debt, interest bearing loans and borrowings, trade and other payables, less cash and
cash equivalents.
43. TRANSFER OF ACTIVE PHARMACEUTICAL INGREDIENTS (API) DIVISION:
The Board of Directors ('Board') of the company at it's meeting held on 07th November 2022 had approved
and proposed to the shareholders the transfer by way of Business Transfer Agreement/Agreement to sell the
Company's Active Pharmaceutical Ingredient (API) business to a wholly owned subsidiary company.
Subsequently, the transfer was approved by the shareholders on 09th January 2023 vide Postal Ballot.The
transfer of Business was subject to approvals from GIDC and other secured lenders(banks) which was under
Process. The Company has now received the approvals in respect of Vapi Plant on 18th April, 2024 from GIDC
and from lenders.
However, the Board of Directors at its meeting held on November 18, 2024 approved the withdrawal of the
transfer of the API division to its wholly owned subsidiary, Themis Chemical Private Limited.
44 OTHER STATUTORY INFORMATION FOR THE YEAR ENDED 31 MARCH 2025 AND 31
MARCH 2024.
(i) The Company has not entered into any transactions with Struck off Companies under section 248 of the
Companies Act, 2013 or section 560 of the Companies Act, 1956 for the year ended 31 March 2025.
(ii) The Company has not traded or invested in Crypto currency or Virtual Currency.
(iii) The Company do not have any transaction not recorded in the books of account that has been surrendered
or not disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 for the
year ended 31 March 2025 and 31 March 2024.
(iv) There is no charge or satisfaction of charge which is yet to be registered with ROC beyond the statutory
period.
(v) The Company has complied with number of layers prescribed under clause (87) of Section 2 of the Act read
with the Companies (Restriction on number of Layers) Rules, 2017.
(vi) The Company do not have any Benami property, where any proceeding has been initiated or pending against
the Company for holding any Benami property.
(vii) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any
other sources or kind of funds), other than in the ordinary course of business by the Company to or in any
other person(s) or entity(ies), including foreign entities ("Intermediaries") with the understanding, whether
recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on
behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s)
(Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest
in other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries") or provide
any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
45. Previous period figures have been re-grouped/re-classified wherever necessary, to confirm to current
period's classification in order to comply with the requirements of the amended Schedule III to the
Companies Act, 2013 effective April 01, 2021.
Significant Accounting Policies and Notes
Forming Part of the Financial Statements. 1 to 45
As per our report of even date attached For and on behalf of the Board
For KRISHAAN & CO.
Chartered Accountants Pradeep Chandan Dr. Dinesh S. Patel
Firm Registration No: 001453S Company Secretary Executive Chairman
(Membership No.: FCS 2852) (DIN: 00033273)
K Sundarrajan
Partner Tushar J. Dalal Dr. Sachin D. Patel
Membership No: 208431 Chief Financial Officer Managing Director & CEO
(DIN: 00033353)
Place: Mumbai Place: Mumbai
Date: May 20, 2025 Date: May 20, 2025
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