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You can view the entire text of Notes to accounts of the company for the latest year

BSE: 539523ISIN: INE540L01014INDUSTRY: Pharmaceuticals

BSE   ` 4894.80   Open: 5046.50   Today's Range 4840.00
5046.50
-136.85 ( -2.80 %) Prev Close: 5031.65 52 Week Range 4498.90
6440.00
Year End :2025-03 

2.13 Provision, Contingent Liabilities and Contingent
Assets:

A provision is recognised if as a result of a past event, the
Company has a present obligation (legal or constructive)
that can be estimated reliably and it is probable that
an outflow of economic benefits will be required to
settle the obligation. Provisions are recognised at the
best estimate of the expenditure required to settle
the present obligation at the balance sheet date. If the
effect of time value of money is material, provisions are
discounted using a current pre-tax rate that reflects,
when appropriate, the risks specific to the liability.

A contingent liability exists when there is a possible but
not probable obligation or a present obligation that may,
but probably will not, require an outflow of resources,
whose existence will be confirmed by the occurrence
or non-occurrence of one or more uncertain future
events beyond the control of the Company, or a present
obligation whose amount can not be estimated reliably.
Contingent liabilities do not warrant provisions but are
disclosed unless the possibility of outflow of resources
is remote. Contingent assets are not recognised but
only disclosed where an inflow of economic benefits
is probable. However, when the realisation of income
is virtually certain, then the related asset is not a
contingent asset and its recognition is appropriate.

Provisions, contingent liabilities and contingent assets
are reviewed at each Balance Sheet date.

2.14 Commitments:

Commitments are future liabilities for contractual
expenditure, classified and disclosed as follows:

(i) estimated amount of contracts remaining to be
executed on capital account and not provided for;

(ii) uncalled liability on shares and other investments
partly paid;

(iii) funding related commitment to subsidiary,
associate and joint venture companies; and

(iv) other non-cancellable commitments, if any, to the
extent they are considered material and relevant in
the opinion of management.

2.15 Discontinued operations and assets held
for sale:

A discontinued operation is a component of the entity
that has been disposed off or is classified as held for
sale and:

• represents a separate major line of business or
geographical area of operations; and

• is part of a single co-ordinated plan to dispose of such
a line of business or area of operations.

The results of discontinued operations are presented
separately as a single amount as standalone statement
of profit and loss after tax from discontinued operations
in the standalone statement of profit and loss.

Assets are classified as held for sale if their carrying
amount will be recovered principally through a sale
transaction rather than through continuing use and a
sale is considered highly probable. They are measured
at the lower of their carrying amount and fair value
less costs to sell. Costs to sell are the incremental costs
directly attributable to the disposal of an asset (disposal
group), excluding finance costs and income tax expense.

The criteria for held for sale classification is regarded as
met only when the sale is highly probable, and the asset
or disposal group is available for immediate sale in its
present condition. Actions required to complete the sale
should indicate that it is unlikely that significant changes
to the sale will be made or that the decision to sell will be
withdrawn. Management must be committed to the plan
to sell the asset and the sale expected to be completed
within one year from the date of the classification.

For these purposes, sale transactions include exchanges
of non-current assets for other non-current assets
when the exchange has commercial substance. The
criteria for held for sale classification is regarded met
only when the assets or disposal group is available for
immediate sale in its present condition, subject only to
terms that are usual and customary for sales of such
assets (or disposal groups), its sale is highly probable;
and it will genuinely be sold, not abandoned. The group
treats sale of the asset or disposal group to be highly
probable when:

• The appropriate level of management is committed to
a plan to sell the asset (or disposal group),

• An active programme to locate a buyer and complete
the plan has been initiated (if applicable),

• The asset (or disposal group) is being actively
marketed for sale at a price that is reasonable in
relation to its current fair value,

• The sale is expected to qualify for recognition as
a completed sale within one year from the date of
classification, and

• Actions required to complete the plan indicate that it
is unlikely that significant changes to the plan will be
made or that the plan will be withdrawn.

An impairment loss is recognised for any initial or
subsequent write-down of the asset to fair value less
costs to sell. A gain is recognised for any subsequent
increases in fair value less costs to sell of an asset, but not
in excess of any cumulative impairment loss previously
recognised. A gain or loss not previously recognised by
the date of the sale of the asset is recognised at the date
of de-recognition.

Property, Plant and Equipment and intangible assets are
not depreciated or amortised while they are classified as
held for sale. Interest and other expenses attributable to
the liabilities of a disposal group classified as held for
sale continue to be recognised.

Assets classified as held for sale are presented
separately from the other assets in the Balance Sheet.
The liabilities of a disposal group classified as held for
sale are presented separately from other liabilities in the
financial statements.

Discontinued operations are excluded from the results
of continuing operations and are presented as a single
amount as profit or loss after tax from discontinued
operations in the statement of profit and loss.

2.16 Statement of Cash Flows:

Statement of Cash Flows is prepared segregating the
cash flows into operating, investing and financing
activities. Cash flow from operating activities is reported
using indirect method, adjusting the profit before tax
excluding exceptional items for the effects of:

(i) changes during the period in inventories and
operating receivables and payables;

(ii) non-cash items such as depreciation, provisions,
unrealised foreign currency gains and losses; and

(iii) all other items for which the cash effects are
investing or financing cash flows.

Cash and cash equivalents for the purpose of statement
of cash flows comprise cash at bank including fixed
deposits (having original maturity of less than 3 months),
cheques in hand and cash in hand.

2.17 Earnings per share (‘EPS'):

Basic EPS is calculated by dividing the profit(or loss)
attributable to the owners of the Company by the
weighted average number of equity shares outstanding
during the period. Diluted EPS is computed using the
weighted average number of equity and dilutive equity
equivalent shares outstanding during the period except
where the results would be anti-dilutive.

2.18 Government Grants:

Government grants and subsidies are recognized when
there is reasonable assurance that the Company will
comply with the conditions attached to them and the
grants / subsidy will be received.

Grants related to depreciable assets are treated as
deferred income which is recognised in the Statement
of profit and loss on a systematic and rational basis over
the useful life of the asset. Such allocation to income is
usually made over the periods and in the proportions
in which depreciation on related assets is charged.
Government Grants of revenue nature is reduced from
related expenses in the statement of Profit and Loss
in the year of its receipt or when there is a reasonable
assurance of its being received.

2.19 Investments in subsidiaries:

I nvestments in subsidiaries are carried at cost less
accumulated impairment losses, if any. Where an

indication of impairment exists, the carrying amount
of the investment is assessed and written down
immediately to its recoverable amount.

2.20Exceptional items:

When items of income and expense within profit or
loss from ordinary activities are of such size, nature
or incidence that their disclosure is relevant to explain
the performance of the enterprise for the period, the
nature and amount of such items is disclosed separately
as Exceptional items.

2.21 Segment reporting:

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 (“CODM”) to make decisions
for which discrete financial information is available. The
Company operates in one reportable business segment
i.e. "Pharmaceuticals".

2.22Recent accounting pronouncements

Ministry of Corporate Affairs (“MCA”) notifies new
standards or amendments to the existing standards
under Companies (Indian Accounting Standards)
Rules as issued from time to time. MCA has notified
amendments to the exisiting standards Ind AS 21 : The
Effects of Changes in Foreign Exchange rates applicable
to the Company w.e.f. 1 April, 2025, to address concerns
about currency exchangeability and provide guidance
on estimating spot exchange rates when a currency is
not exchangeable. There is no significant impact on the
Company in the current year.

2B Key accounting estimates
and judgements

The preparation of financial statements in conformity
with the Ind AS requires judgements, estimates and
assumptions to be made that affect the reported
amounts of assets and liabilities on the date of the
financial statements, the reported amounts of revenues
and expenses during the reporting period and the
disclosures relating to contingent liabilities as of the date
of the financial statements. Although these estimates
are based on the management's best knowledge of
current events and actions, uncertainty about these
assumptions and estimates could result in outcomes
different from the estimates. Difference between actual
results and estimates are recognised in the period in
which the results are known or materialise. Estimates

and underlying assumptions are reviewed on an ongoing
basis. Any revision to accounting estimates is recognised
prospectively in the current and future periods.

Management considers the accounting estimates and
assumptions discussed below to be its critical accounting
estimates and, accordingly, provide an explanation of
each below. The discussion below should also be read in
conjunction with the Company's disclosure of material
accounting policies which are provided in Note 2A to the
standalone financial statements, ‘Material accounting
policies'.

i) Judgements

a) The Company uses significant judgement
in assessing the lease term (including
anticipated renewals) and the applicable
discount rate. The Company determines the
lease term as the non-cancellable period of a
lease, together with both periods covered by
an option to extend the lease if the Company is
reasonably certain to exercise that option; and
periods covered by an option to terminate the
lease if the Company is reasonably certain not
to exercise that option. In assessing whether
the Company is reasonably certain to exercise
an option to extend a lease, or not to exercise
an option to terminate a lease, it considers all
relevant facts and circumstances that create
an economic incentive for the Company to
exercise the option to extend the lease, or not
to exercise the option to terminate the lease.
The Company revises the lease term if there
is a change in the non-cancellable period of
a lease.

ii) Estimates

a) Estimate of current and deferred tax:

The Company's tax charge on ordinary activities
is the sum of the total current and deferred
tax charges. The calculation of the Company's
total tax charge necessarily involves a degree
of estimation and judgement in respect of
certain items whose tax treatment cannot be
finally determined until resolution has been
reached with the relevant tax authority or, as
appropriate, through a formal legal process.
The final resolution of some of these items
may give rise to material profits/losses and/or
cash flows. The complexity of the Company's
structure makes the degree of estimation and
judgement more challenging. The resolution
of issues is not always within the control of

the Company and it is often dependent on the
efficiency of the legal processes in the relevant
taxing jurisdictions in which the Company
operates. Issues can, and often do, take many
years to resolve. Payments in respect of tax
liabilities for an accounting period result
from payments on account and on the final
resolution of open items. As a result there can
be substantial differences between the tax
charge in the Statement of Profit and Loss and
tax payments. The recognition of deferred tax
assets is based upon whether it is more likely
than not that sufficient and suitable taxable
profits will be available in the future against
which the reversal of temporary differences
can be deducted. To determine the future
taxable profits, reference is made to the
latest available profit forecasts. Where the
temporary differences are related to losses,
relevant tax law is considered to determine
the availability of the losses to offset against
the future taxable profits.

b) Recognition of MAT credit:

The credit availed under MAT is recognised
as an asset only when and to the extent there
is convincing evidence that the Company will
pay normal income tax during the period for
which the MAT credit can be carried forward
for set off against the normal tax liability. This
requires significant management judgement
in determining the expected availment of the
credit based on business plans and future
cash flows of the Company.

c) Estimation of useful life:

The useful life used to amortise or depreciate
intangible assets or property, plant and
equipment respectively relates to the
expected future performance of the assets
acquired and management's judgement of
the period over which economic benefit will be
derived from the asset based on its technical
expertise. The charge in respect of periodic
depreciation is derived after determining an
estimate of an asset's expected useful life
and the expected residual value at the end of
its life. Increasing an asset's expected life or
its residual value would result in a reduced
depreciation charge in the Statement of
Profit and Loss. The useful lives and residual
values of Company's assets are determined by
management at the time the asset is acquired

and reviewed annually for appropriateness.
The lives are based on historical experience
with similar assets as well as anticipation of
future events which may impact their life such

as changes in technology.

d) Provisions and contingent liabilities:

The Company exercises judgement in
measuring and recognising provisions and the
exposures to contingent liabilities related to
pending litigation or other outstanding claims
subject to negotiated settlement, mediation,
arbitration or government regulation, as well
as other contingent liabilities. Judgement is
necessary in assessing the likelihood that
a pending claim will succeed, or a liability
will arise, and to quantify the possible range
of the financial settlement. Due to inherent
uncertainty in this evaluation process, actual
losses may be different from the originally
estimated provision.

e) Impairment loss in investments carried at
cost:

The Company conducts impairment reviews of
investments in subsidiaries whenever events
or changes in circumstances indicate that their
carrying amounts may not be recoverable or
tests for impairment annually. Determining
whether an asset is impaired requires an
estimation of the recoverable amount, which
requires the Company to estimate the value in
use which is based on future cash flows and a
suitable discount rate in order to calculate the
present value.

f) Fair value measurements and
valuation processes:

When the fair value of financial assets and
financial liabilities recorded in the balance
sheet cannot be measured based on quoted
prices in active markets, their fair value
is measured using valuation techniques
including the Discounted Cash Flow model.
The inputs to these models are taken from
observable markets where possible, but
where this is not feasible, a degree of
judgement is required in establishing fair
values. Judgements include considerations
of inputs such as liquidity risk, credit risk and
volatility. Changes in assumptions about these

factors could affect the reported fair value of
financial instruments.

g) Defined Benefit Plans:

The cost of the defined benefit gratuity plan
and other post-employment benefits and
present value of the gratuity obligation are
determined using actuarial valuation. An
actuarial valuation involves making various
assumptions that may differ from actual
development in the future. These include the
determination of the discount rate, future
salary increases, attrition rate and mortality
rates. Due to complexities involved in the
valuation and its long term nature, a defined
benefit obligation is highly sensitive to changes
in these assumptions. All assumptions are
reviewed at each reporting date.

h) Liabilities towards anticipated
sales return:

In determining the provision for anticipated
sales returns, estimates for probable saleable
and nonsaleable returns of goods from the
customers are made on scientific basis after
factoring in the historical data of such returns
and its trend.

i) Discount rate for Leases:

The discount rate is generally based on the
incremental borrowing rate specific to the
lease being evaluated or for a portfolio of
leases with similar characteristics.

l) Expected credit loss:

I n accordance with Ind AS 109 - Financial
Instruments, the Company applies ECL
model for measurement and recognition of
impairment loss on the trade receivables
from transactions that are within the scope
of Ind AS 115 - Revenue from Contracts with
Customers. For this purpose, the Company
follows ‘simplified approach' for recognition
of impairment loss allowance on the trade
receivable balances. The application of
simplified approach requires expected
lifetime losses to be recognised from initial
recognition of the receivables based on
lifetime ECLs at each reporting date.

As a practical expedient, the Company uses
a provision matrix to determine impairment
loss allowance on portfolio of its trade
receivables. The provision matrix is based on
its historically observed default rates over the
expected life of the trade receivables and is
adjusted for forward-looking estimates. At
every reporting date, the historical observed
default rates are updated and changes in the
forward-looking estimates are analysed.

In respect of other financial assets (e.g.: debt
securities, deposits, bank balances etc), the
Company generally invests in instruments
with high credit rating and consequently low
credit risk. In the unlikely event that the credit
risk increases significantly from inception of
investment, lifetime ECL is used for recognising
impairment loss on such assets.

4) During the year ended 31 March 2016, pursuant to the approval of the Board of Directors in its meeting held on
9 March 2016, the Company in order to focus on its core business activities and for other commercial reasons,
restructured its investment in Avenue Venture Real Estate Fund (“Fund”) by entering into an Option Agreement
with Mr. Tushar Kumar, which was in force for a period of 2 years from the execution date i.e 10 March 2016. The
Option Agreement was subsequently renewed for a period of 2 years each by executing First, Second and Third
Supplementary agreement till 9 March 2020, 9 March 2022 and 9 March 2024 respectively. During the previous
year, pursuant to the approval of the Board of Directors in its meeting held on 9 February, 2024, the Company has
entered into an Option Agreement with Mr. Jyoti Prakash Narayan Singh which is in force for a period of 2 years
from execution date i.e 10 March 2024 for grant of unconditional option exercisable without restriction at the option
of the option holder to purchase the trust units held by the Company in the Fund at an option price of 102% of the
fair market value of each trust unit as on the exercise date.

(b) Rights, preferences and restrictions attached to Equity Shares:

The Company has issued one class of equity shares with voting rights having a par value of C2 per share.
Each shareholder is eligible for one vote per share held. The Company declares dividend in Indian Rupees. The
dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the ensuing Annual
General Meeting.

On winding up of the Company, the holders of equity shares will be entitled to receive residual assets of the Company
remaining after distribution of all preferential amounts in proportion to the number of equity shares held by
the shareholders.

3.27 Dues to Micro and Small enterprises

Under the Micro, Small and Medium Enterprises Development Act, 2006, (MSMED) which came into force from 2 October,
2006, certain disclosures are required to be made relating to Micro and Small enterprises. On the basis of the information
and records available with the Management, the outstanding dues to the Micro and Small enterprises as defined in the
MSMED as set out in following disclosure.

The above information regarding Micro and Small Enterprises has been determined on the basis of information available
with the Company basis the details provided by the enterprises.

3.28 Disclosure of Employee Benefits

i) Defined contribution plans:

The Company makes contributions towards provident fund. The Company is required to contribute a specified percentage
of salary cost to the Government Employee Provident Fund, Government Employee Pension Fund, Employee Deposit
Linked Insurance and Employee State Insurance, which are recognised in the Statement of Profit and Loss on accrual
basis. Eligible employees receive the benefits from the said funds. Both the employees and the Company make monthly
contribution to the said funds plan equal to a specific percentage of the covered employee's salary. The Company has
no obligations other than to make the specified contributions.

ii) Defined benefit plan:

The Company provides for payment of gratuity to vested employees as under:

a) On Normal retirement/ early retirement/ withdrawal/resignation:

As per the provisions of Payment of Gratuity Act, 1972 with vesting period of 5 years of service.

b) On death in service:

As per the provisions of Payment of Gratuity Act, 1972 without any vesting period.

The most recent actuarial valuation of the present value of the defined benefit obligation for gratuity was carried
out as at 31 March, 2025 by an independent actuary. The present value of the defined benefit obligations and the
related current service cost and past service cost, were measured using the Projected Unit Credit Method.

The following table sets out the status of the gratuity plan (unfunded) and the amounts recognised in the Company's
financial statements as at 31 March, 2025:

*For the previous year the figures related to the statement of profit and loss have been given impact of the generic
business carveout; however, the balance sheet items have not adjusted to give impact of the carved out.

Discount rate: The discount rate is based on the prevailing market yields of Indian government securities as at the balance
sheet date for the estimated term of the obligations.

Salary Escalation Rate: The estimates of future salary increases, considered in actuarial valuation, takes into account
the inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

Maturity profile of defined benefit obligation:

3.34 Segment Reporting

The Company has presented data relating to its segments in its consolidated financial statements. Accordingly, in terms
of paragraph 4 of the Indian Accounting Standard 108 (IND AS-108) “Segment Reporting”, no disclosures related to
segments are presented in the standalone financial statements.

3.35 Information on related party transactions as required by Indian Accounting Standard
24 (Ind AS 24) on related party disclosures.

The Company's prinicipal related parties consist of its subsidiaries and associate (Refer list below), Key Managerial
Personnel ("KMP"), Close members of KMP and entities in which KMP and their Close members have significant influence
("Affiliates"). The Company's material related party transactions and outstanding balances are with related parties with
whom the Company routinely enters into transactions in the ordinary course of business.

B. Measurement of fair values

The Management assessed that cash and bank balances, trade receivables, trade payables, cash credit and other

financial assets and liabilities approximate their carrying amounts due to short-term maturities of these instruments.

The following methods and assumptions were used to estimate the fair value :

a) Level 1: The fair value of the quoted investments/units of mutual fund scheme are based on market price/net asset
value at the reporting date.

b) Level 2: The fair value of financial instruments that are not traded in an active market (i.e. venture capital funds)
is determined using valuation techniques which maximize the use of observable market data and rely as little as
possible on company specific estimates.

c) Level 3: The fair value of the remaining financial instrument is determined using discounted cash flow analysis. The
discount rates used are based on management estimates.

The significant unobservable inputs used to determine the fair value of investment in fund together with the quantitative

sensitivity analysis as at 31 March, 2025 and 31 March, 2024 are as shown below:

The Company has exposure to the following risks arising from financial instruments:

• Credit risk ;

• Liquidity risk ; and

• Market risk

Risk management framework

The Company's Board of Directors have overall responsibility for the establishment and oversight of the Company's risk
management framework. The Board of Directors have established a Risk Management Committee, which is responsible
for developing and monitoring the Company's risk management policies. The committee reports regularly to the Board
of Directors on its activities.

The Company's risk management policies are established to identify and analyse the risks faced by the Company, to
set appropriate risk limits and controls and to monitor risks and adherence to the limits. Risk management policies and
systems are reviewed regularly to reflect changes in market conditions and the Company's activities. The Company,
through its training and management standards and procedures, aims to maintain a disciplined and constructive control
environment in which all employees understand their roles and obligations.

The Audit Committee oversees how management monitors compliance with the Company's risk management policies and
procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.
The Audit Committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc
reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.

i. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to
meet its contractual obligations. The Company is exposed to credit risk from its operating activites (primarily trade
receivables) and from its financing/investing activities, including investments in debt securities, deposits with banks,
equity securities, venture capital and mutual fund investments. The Company has no significant concentration of credit
risk with any counterparty.

The carrying amount of following financial assets represents the maximum credit exposure:

Trade receivables

Trade receivables consisits of a large number of customers. The Company's exposure to credit risk is influenced mainly
by the individual characteristics of each customer. However, management also considers the factors that may influence
the credit risk of its customer base, including the default risk of the industry and country in which customers operate.

The Company has established a credit policy under which each new customer is analysed individually for creditworthiness
before the Company's standard payment and delivery terms and conditions are offered. The Company's review includes
external ratings, if they are available, and in some cases bank references. Payment terms with customers vary depending
upon the contractual terms of each contract. Sale limits are established for each customer and reviewed quarterly.

At 31 March, 2025, the carrying amout of the Company's most significant customer (Ascend Laboratories LLC, its wholly
owned step-down subsidiary) is J7,508.9 Million (31 March, 2024: T 5,891.7 Million)

Impairment

As per the simplified approach, the Company has used a practical expedient by computing the expected credit loss
allowance for trade receivables based on a provision matrix. The provision matrix takes into account historical credit
loss experience and adjusted for forward looking information. The expected credit loss allowance is based on the ageing
of the days the receivable are due and the rates as given in the provision matrix.

Refer note 3.8 for ageing of trade receivables that were not impaired.

Loans to subsidiaries

The Company has an exposure of 2 90.7 Million as at 31 March, 2025 (31 March, 2024: 2 3.5 Million) for loans given to
subsidiaries. Such loans are classified as financial asset measured at amortised cost.

The Company did not have any amounts that were past due but not impaired at 31 March, 2025 or 31 March, 2024. The
Company has no collateral in respect of these loans.

Investments, Cash and Cash Equivalents and Bank Deposits

Credit risk on cash and cash equivalents, deposits with banks is generally low as the said deposits have been made with
the banks who have been assigned high credit rating by international and domestic credit rating agencies.

I nvestments of surplus funds are made only with approved financial institutions. Investments primarily include
investments in subsidiaries, mutual funds, venture capital funds, investment in equity of other companies /LLP, quoted
bonds and non-convertible debentures. These mutual funds and counterparties have low credit risk.

Total non-current and current investments as at 31 March, 2025 is 2 71,235.0 Million (31 March, 2024: 2 60,248.4 Million)

Debt securities

The Company has an exposure of 2 6,424.7 Million as at 31 March, 2025 (31 March, 2024: 2 208.8 Million) for debt
securities classified as financial asset measured at amortised cost. All the debt securities have been issued by companies
registered in India in Indian Rupees.

There has been no allowance for impairment in respect of such debt securities - financial asset measured at amortised
cost till 31 March, 2025.

The Company did not have any debt securities that were past due but not impaired at 31 March, 2025 or 31 March, 2024.
The Company has no collateral in respect of these investments.

ii. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity
is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both
normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation.

The majority of the Company's trade receivables are due for maturity within 21 - 60 days from the date of billing to the
customer. Further, the general credit terms for trade payables are approximately 45 - 60 days. The difference between
the above mentioned credit period provides sufficient headroom to meet the short-term working capital needs for day-
to-day operations of the Company. Any short-term surplus cash generated, over and above the amount required for
working capital management and other operational requirements, are retained as Cash and Investment in short term
and long term deposits with banks. The said investments are made in instruments with appropriate maturities and
sufficient liquidity.

Exposure to liquidity risk

The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross
and undiscounted, and include estimated interest payments and exclude the impact of netting agreements.

iii. Market risk

Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and equity prices
- will affect the Company's income or the value of its holdings of financial instruments. Market risk is attributable to all
market risk sensitive financial instruments including foreign currency receivables and payables and long term debt.
Company is exposed to market risk primarily related to foreign exchange rate risk, interest rate risk and the market
value of its investments. Thus, the exposure to market risk is a function of investing and borrowing activities and revenue
generating and operating activities in foreign currency. The objective of market risk management is to avoid excessive
exposure in our foreign currency revenues and costs.

Currency risk

The Company is exposed to currency risk on account of its borrowings, other payables, receivables and loans and
advances in foreign currency. The functional currency of the Company is Indian Rupee. The Company has exposure to
EUR, GBP, USD, AUD, CNY, CAD, JPY, KES, NPR, AED and CHF. The Company has formulated hedging policy for monitoring
its foreign currency exposure.

Interest rate risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest rate risk is the
risk of changes in fair values of fixed interest bearing investments, borrowings and loans because of fluctuations in the
interest rates. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing investments,
borrowings and loans will fluctuate because of fluctuations in the interest rates.

Exposure to interest rate risk

Company's interest rate risk arises from borrowings and fixed income securities. Fixed income securities exposes the
Company to fair value interest rate risk. The interest rate profile of the Company's interest-bearing financial instruments
is as follows:

Interest rate sensitivity - fixed rate instruments

The Company's fixed rate borrowings and fixed rate bank deposits 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 flow will
fluctuate because of a change in market interest rates.

Interest rate sensitivity - variable rate instruments

A reasonably possible change of 5% in interest rates at the reporting date would have increased (decreased) equity and
profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency
exchange rates, remain constant.

3.38 Capital management

The Company's policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence
and to sustain future development of the business. Management monitors the return on capital as well as the level of
dividends to ordinary shareholders.

The Company monitors capital using a ratio of ‘net debt' to ‘total equity'. For this purpose, adjusted net debt is defined
as total liabilities, comprising interest-bearing loans and borrowings, less cash and cash equivalents. Adjusted equity
comprises all components of equity.

3.40 The gross amount required to be spent by the Company on Corporate Social Responsibility (""CSR"") as per section
135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Amendment Rules,
2021 during the year is
? 331.0 Million (31 March, 2024: T 327.6 Million).

The Company has spent an amount of ? 359.1 Million (31 March, 2024: T 343.7 Million) towards the CSR obligation of the
Company and an amount of
? 2.2 Million (31 March, 2024: T 4.2 Million) was transferred to the “Unspent CSR Account”
towards the ongoing projects initiated by the Company towards CSR as per the approved CSR policy of the Company
on healthcare, women empowerment, education, sanitation, conservation of environment, rural development.

Above spend includes a transfer of ? 350.1 Million (31 March, 2024: T 343.5 Million) to Alkem Foundation, a subsidiary of
the Company, which is a Section 8 registered company under Companies Act, 2013, with the main objectives of working
in the areas of social, economic and environmental issues such as healthcare, women empowerment, education,
sanitation, conservation of environment, rural development and enable the less privileged segments of the society to
improve their livelihood by enhancing their means and capabilities to meet the emerging opportunities.

Figures in the brackets are the comparative figures of the previous year.

Subsequent to 31 March, 2025, an amount of ? 2.2 Million (Previous year: T 4.2 Million has been transferred to the
separate CSR Unspent account on 30 April, 2025 (Previous year: 30 April, 2024) in accordance with the Companies
(Corporate Social Responsibility Policy) Amendment Rules, 2021 rules.

3.41 Government Grant

The Company is eligible for government grants which are conditional upon construction of new factories in the Sikkim
region. One of the grants, received in FY 2014-15 amounted to T 72.4 Million with respect to the Kumrek facility. The factory
has been constructed and in operation since August 2007. The second grant is with respect to Samardung facility in Sikkim
amounting to T 122.1 Million for which the Company has received the claim amount in FY 2018-19. The factory has been
constructed and in operation since October, 2012. The third grant is with respect to AHS-3 facility in Sikkim amounting
to T 30.6 Million for which the Company has received the claim amount in the previous year. Further, during the previous
year, Company has received grant amounting to T 398.7 Million with respect to AHS- 2 facility in Sikkim. These grants,
recognized as deferred income, are being amortized over the useful life of the plant and machinery in proportion to the
related depreciation expense. The unamortised grant as on 31 March, 2025 amounts to
? 245.6 Million (Previous year:
T 282.7 Million), the breakup of which is as below:

3.42 Additional disclosure with respect to amendments to Schedule III

i) The Company does not have any Benami property, where any proceeding has been initiated or pending against them for
holding any Benami property.

ii) The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered
or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey
or any other relevant provisions of the Income Tax Act,1961)

iii) The Company has not been declared a wilful defaulter by any bank or financial institution or other lender (as defined
under the Companies Act, 2013) or consortium thereof, in accordance with the guidelines on wilful defaulters issued by
the Reserve Bank of India.

iv) The Company does not have any changes or satisfaction which is yet to be registered with Registrar of Companies (ROC)
beyond the statutory period.

v) The Company has not traded or invested in Crypto Currency or Virtual Currency during the financial year

vi) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources
or kind of funds) or provided any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries by the
Company to or in any other person or entity, 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 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.

vii) The Company has not received any funds to lend or invest in other persons or entities on behalf of the Funding party.
Further, there are no funds received 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 ("Ultimate Beneficiaries”) identified by or on
behalf of the Funding Party or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

viii) The Company has complied with the number of layers prescribed under the Companies Act, 2013

3.43 Assets held for sale

In respect of one of the manufacturing units located at Indore, where indicators of impairment were identified, the
Company identified the recoverable amount of the CGUs, being the higher of the value in use and fair value less costs of
disposal, as compared with the carrying value. The outcome of this exercise as on 31 March, 2024 resulted in the Company
recognizing an impairment loss of T 415.6 Million in the standalone financial statements under ‘Exceptional Items'.
In the current year; the Company as a part of its ongoing initiative of networking strategy and optimisation of
manufacturing facilities has identified divestment of its Indore facility. Consequently, related assets and liabilities are
disclosed as held for sale. These assets and liabilities have been carried at cost as the same are lower than the fair value
expected out of sale.

3.44 Exceptional items

(a) During the previous year, the Company disclosed about a Cyber security incident occured in November 2023 that
compromised business email IDs of certain employees at one of the Company's subsidiaries which resulted in a
fraudulent transfer of 2 513.1 Million. The Company employed independent external agencies to investigate the
incident. Based on their report, the Company concluded that the impact of the incident did not extend beyond the
above mentioned amounts nor did it occur due to any fraudulent act on part of any of the promoters, directors, key
managerial personnel or any member of the senior management or any other employee of the Company or it's subsidiary.
The Company has since strengthened its cybersecurity infrastructure and is in the process of implementing improvements
to its cyber and data security systems to safeguard against such risks in the future. The Company is also implementing
certain long-term measures to augment its security controls systems across the organization. The Company believes that
no legal violations have occurred because of this incident, and all known impacts on its standalone financial statements
for the year ended 31 March, 2024 on account of this incident have been considered. Further, subsequent to this event,
the Company has been able to recover an amount of 2 290.4 Million and the net amount of 2 222.7 Million has been shown
as ‘Exception item' in the Statement of Profit and Loss.

(b) The Company has considered indicators of impairment of its cash-generating units (CGUs') for factors like decline in
operational performance, changes in the outlook of future profitability, and weaker market conditions, among other
potential indicators. In respect of one of the manufacturing units located at Indore, where indicators of impairment were
identified, the Company identified the recoverable amount of the CGUs, being the higher of the value in use and fair value
less costs of disposal, as compared with the carrying value. The value in use is derived from discounted future cash
flows uses several assumptions like long term growth rate, discount rate, potential product obsolescence, new product
launches and the weighted average cost of capital. The outcome of this exercise as on 31 March, 2024 resulted in the
Company recognizing an impairment loss of 2 415.6 Million in the financial statements under ‘Exceptional Items'.

3.45 Events after the reporting period

No significant adjusting event occurred between the balance sheet date and date of the approval of these standalone
financial statements by the Board of Directors of the Company requiring adjustment or disclosure.

*The previous year figures have not been restated to give the impact of the generic business carveout.

Earnings available for debt service = Net Profit after taxes Non-cash operating expenses like depreciation and other
amortizations Interest other adjustments like loss on sale of Fixed assets etc.

Debt service = Interest & Lease Payments Principal Repayments

Net credit sales consist of gross credit sales minus sales return.

Net credit purchases consist of gross credit purchases minus purchase return

Capital Employed = Tangible Net Worth Total Debt Deferred Tax Liability

For and on behalf of the Board of Directors of Alkem Laboratories Limited

CIN: L00305MH1973PLC174201

B.N. Singh Sandeep Singh M.K. Singh

Executive Chairman Managing Director Executive Director

DIN. 00760310 DIN. 01277984 DIN. 00881412

Mumbai, India Mumbai, India Mumbai, India

Dr. Vikas Gupta Nitin Agrawal Manish Narang

Chief Executive Officer President - Finance & President - Legal &

Mumbai, India Chief Financial Officer Company Secretary

Mumbai, India Mumbai, India

Membership no.: F4365

29 May, 2025