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நிறுவன பெயரின் முதல் சில எழுத்துக்களை நிரப்பி 'கோ' பட்டனை கிளிக் செய்யவும்

Alembic Pharmaceuticals Ltd. இன் கணக்கு குறிப்புகள்

Mar 31, 2023

The rights, preferences and restrictions including restrictions on the distribution of dividends and the repayment of capital

The Company is having only one class of shares i.e. Equity carrying a nominal value of H2/- per share. Every holder of the equity share of the Company is entitled to one vote per share held. In the event of liquidation of the Company, the equity shareholders will be entitled to receive remaining assets of the Company after the distribution/repayment of all creditors. The distribution to the equity shareholders will be in proportion of the number of shares held by each shareholder.

The Company declares and pays dividend on the equity shares in Indian Rupees. Dividend proposed by the Board of Directors is subject to approval of the shareholders at the ensuing Annual General Meeting, except in case of interim dividend.

Nature and purpose of each Reserve

General Reserve :- The reserve was created by transfer of a portion of the net profit.

Securities Premium :- Securities premium is used to record the premium on issue of shares. The reserve can be utilised in accordance with provisions of the Companies Act, 2013.

Debenture Redemption Reserve : The company has created debenture redemption reserve out of the profits as prudent practice in accordance with erstwhile provision of Companies Act, 2013.

Other Comprehensive Income (OCI) : represents remeasurements of the defined benefits plan and fair value change of certain financial instruments.

Contingent Liabilities, Contingent Asset and Commitments (To The Extent Not Provided For) (H in Crores)
Particulars	As at	As at
Particulars	31^st March, 2023	31^st March, 2022
i Estimated amount of contracts net of advances remaining to be executed on capital accounts and not provided for:	208.73	165.28
ii Contingent liabilities (a) Letters of credit and Guarantees	114.94	61.35
(b) Liabilities Disputed in appeals filed with respect to Indirect tax	1.77	0.79
(c) Claims against the company not acknowledged as debt	0.35	0.35
(d) Export obligation against advance license	0.04	0.03
(e) Disputed liability in respect of Ministry of Industry, Department of Chemicals and Petrochemicals in respect of price of Rifampicin allowed in formulations and landed cost of import.	0.35	0.35
(f) Disputed cases under Industrial Dispute Act,1947 and	Amount not	Amount not
other forums.	ascertainable	ascertainable

4 Segment Reporting

Segment information as required under Ind AS 108 i.e. Operating Segments is given in the Consolidated financial statements of the Company.

A description of methods used for sensitivity analysis and its limitations:

S ensitivity analysis is performed by varying single parameter while keeping all the other parameters unchanged. Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously. The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change, if any.

Major risk to the plan

A. Actuarial Risk: It is the risk that benefits will cost more than expected. This can arise due to one of the following reasons: Adverse Salary Growth Experience: Salary hikes that are higher than the assumed salary escalation will result into an increase in Obligation at a rate that is higher than expected. Variability in mortality rates: If actual mortality rates are higher than assumed mortality rate assumption then the Gratuity Benefits will be paid earlier than expected. Since there is no condition of vesting on the death benefit, the acceleration of cash flow will lead to an actuarial loss or gain depending on the relative values of the assumed salary growth and discount rate. Variability in withdrawal rates: If actual withdrawal rates are higher than assumed withdrawal rate assumption then the Gratuity Benefits will be paid earlier than expected. The impact of this will depend on whether the benefits are vested as at the resignation date.

A . Investment Risk: For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.

A. Liquidity Risk: Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign/retire from the company there can be strain on the cash flows.

D. Market Risk: Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in Defined Benefit Obligation of the plan benefits & vice versa. This assumption depends on the yields on the corporate/government bonds and hence the valuation of liability is exposed to fluctuations in the yields as at the valuation date.

D. Legislative Risk: Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation/regulation. The government may amend the Payment of Gratuity Act thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the Defined Benefit Obligation and the same will have to be recognized immediately in the year when any such amendment is effective.

6 Provident Fund

The Company is liable for any shortfall, as per terms of the Provident Fund Trust deed, in the fund assets based on the Government specified rate of return. Such shortfall, if any, is recognised in the Statement of Profit and Loss as an expense in the year of incurring the same, no such shortfall during the year & in previous year. Contribution to Provident fund trust and ESIC H31.09 Crores (PY H27.73 Crores).

Refer Note No 5,7,8,9,10,27(22),16,17,18,27(7)J.

The Fair value of unquoted investment in Limited liability partnerships is arrived by Net Asset Value (''NAV'') method under Cost Approach by external valuation agency. The valuation is carried out based on provisional financial statement of ABCD Technologies LLP as at 31^st December, 2022. With respect to the fair value of the investment in Rigimmune. Inc., due to insignificant change in fair valuation, transaction price is considered as fair value as at 31^st March, 2023.

C redit 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, and arises principally from the Company''s receivables from customers, Deposit, Cash and cash equivalents and other receivables.

Trade receivables

Che Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer, demographics of the customer, default risk of the industry and country in which the customer operates. Credit risk is managed 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 has used expected credit loss model for assessing the impairment loss.

Cash and cash equivalents

Cs at the year end, the Company held cash and cash equivalents of H21.67 Crores (PY ?13.56 Crores). The cash and cash equivalents, other bank balances and derivatives are held with banks having good credit rating.

Other financial assets

Other financial assets are neither past over due nor impaired.

Liquidity risk is the risk that the Company will not be able to meet its financial obligation as they fall due. The Company ensures that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions. The Company has sufficient unutilised fund and non fund based working capital credit limit duly sanctioned by various banks.

The company is rated by leading credit agency CRISIL, the rating "CRISIL A1 " and "AA /Stable" has been assigned for short term and long term facility respectively, indicating high degree of safety regarding timely payment and servicing of financial obligation.

iii) Market risk Currency Risk

The Company''s foreign exchange risk arises from its foreign operations, foreign currency revenues and expenses. The Company uses foreign exchange option contracts, to mitigate the risk of changes in foreign currency exchange rates in respect of its business transactions and recognized assets and liabilities. The Company enters into foreign currency options contracts which are not intended for trading or speculative purposes but for mitigating currency risk.

Sensitivity analysis

For the year ended 31^st March, 2023 every 5% weakening of Indian Rupee as compare to the respective major currencies for the above mentioned financial assets/liabilities would increase Company''s profit and equity by approximately H40.01 Crores (PY H34.39 Crores). A 5% strengthening of the Indian Rupee as compare to the respective major currencies would lead to an equal but opposite effect.

Interest rate risk and Exposure to interest rate risk

The Company has loan facilities on floating interest rate, which exposes the company to risk of changes in interest rates.

T or the year ended 31^st March, 2023 every 50 basis point decrease in the floating interest rate component applicable to its borrowings would decrease the Company''s interest cost by approximately H2.68 Crores (PY ?0.90 Crores) on a yearly basis. A 50 basis point increase in floating interest rate would have led to an equal but opposite effect.

Commodity rate 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.

Other Risk

S ince company has been significantly dealing in regulatory market, continuous compliance of all manufacturing facilities is pre requisite. Any adverse action by regulatory authority of the company''s target market can adversely affect company''s operation.

18 Capital Management

The Company''s capital management objectives are:

* to ensure the Company''s ability to continue as a going concern and

* to provide an adequate return to shareholders through optimisation of debts and equity balance.

The Company monitors capital on the basis of the carrying amount of debt less cash and cash equivalents as presented on the face of the financial statements. The Company''s objective for capital management is to maintain an optimum overall financial structure.

20 Disaggregation of revenue

The Company is engaged in Pharmaceuticals business considering nature of products, revenue can be disaggregated as API business and Formulation business H1165.16 Crores and H3983.84 Crores respectively, and considering Geographical business, revenue can be disaggregated as in India H2312.20 Crores and out side India H2836.80 Crores.

25 The Company has working capital borrowing from banks on the basis of security of current asset and quarterly returns filed by the Company with banks are in agreement with the books of account.

26 Business Combination

I n the previous year, the Board of Directors of the Company had at their meeting held on 29^th March, 2022 inter alia approved the Scheme of Arrangement in nature of Amalgamation of Aleor Dermaceuticals Ltd. (''the Transferor Company''/''Aleor'') engaged in the business of Pharmaceuticals with Alembic Pharmaceuticals Ltd. (''the Transferee Company'') and their respective shareholders (''the Scheme'') with effect from the appointed date i.e. 1^st April, 2021. The said Scheme had been sanctioned by the Hon''ble National Company Law Tribunal, Ahmedabad Bench ("NCLT") vide its Order dated 29^th August, 2022. The Scheme was effective upon filing of the certified copy of the said Order with the Registrar of Companies, Gujarat/Ministry of Corporate Affairs. Accordingly, the Board approved the financial statements after giving effect to the Scheme.

Ts per Ind AS - 103, the financial information in the financial statements in respect of prior period is required to be restated as if the business combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the actual date of the combination, Accordinglly the Company has restated the financials of the comparative period, on account of Amalgamation of Aleor. The transaction does not have any impact on the consolidated financial statement.

The Standalone Financial Statements for the year ended 31^st March, 2022 were earlier approved by the Board of Directors on 2^nd May, 2022 on pre-Amalgamation basis. Pursuant to the approval of the Scheme by Hon''ble NCLT, this Standalone Financial Statement for the year ended 31^st March, 2022 had been revised as per the scheme by applying the principles as set out in Appendix C of Ind As 103 "Business Combination" and inter-company balances and inter-company investments between both companies stood canceled. The financial statements of Aleor for the year ended on March 31, 2022 and March 31, 2021 were audited by the statutory auditor of Aleor.

27 The Board of Directors of the Company at their meeting held on 2nd March, 2023, inter alia, considered and

approved:

a I impairment review of the capital work-in-progress ("CWIP") in respect of 3 (three) new manufacturing

facilities that were under construction viz. Formulation 2 located at Panelav, Gujarat, Formulation 3 located at Karakhadi, Gujarat and Formulation 4 located at Jarod, Gujarat, which indicated an aggregate impairment amount of ?1,150.43 Crores ("Identified CWIP"), to be charged to the Statement of Profit and Loss of FY 2022-23, as write-off in respect of manufacturing facilities or part thereof, for which the commercial operation has commenced during the FY 2022-23, and as provision for impairment / diminution in the value of assets in respect of manufacturing facilities or part thereof, for which the commercial operation has not commenced during the FY 2022-23; and

b D raft Scheme of Arrangement between the Company and its shareholders ("Scheme"), which provides for

reorganization / utilization of General Reserve of the Company, pursuant to the provisions of Section 230 and other applicable provisions of the Companies Act, 2013 read with applicable rules made thereunder, with the Appointed Date of 1^st January, 2023 subject to receipt of requisite regulatory, statutory and contractual approvals. Currently, the Scheme is pending with the Stock Exchanges / SEBI for their No-objection Letter as required under Regulation 37 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

I n view of above, an Identified CWIP amount of H676.87 Crores has been written off to the Statement of Profit and Loss for the year ended 31^st March, 2023, in respect of manufacturing facilities or part thereof, for which the commercial operation has commenced during the FY 2022-23 and an Identified CWIP amount of H473.56 Crores has been provided for in the Statement of Profit and Loss as provision for impairment /diminution in the value of assets in respect of manufacturing facilities or part thereof, for which the commercial operation has not commenced during the FY 2022-23. Further, an amount equivalent to the amount of write-off and impairment of assets (net of deferred tax) has been transferred from General Reserve to the Statement of Profit and Loss for the financial year ended on 31^st March, 2023.

Above items a) and b) are disclosed as Exceptional item. Refer Note 26.

c Dhe amount of H868.63 crores has been transferred from General Reserve to the Retained Earnings under

the head "Other Equity" during the financial year ended on 31^st March, 2023, pending requisite approvals as stated above, for which there is no specific accounting treatment specified in Ind AS.

28 Other Statutory information

i Dhe company does not have any Benami property, where any proceeding has been initiated or pending against the company for holding any Benami property.

ii Dhe company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

iii The company have not traded or invested in Crypto currency or Virtual Currency during the period/year.

iv The company have not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a) d irectly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

v The company have not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the company shall:

(a) d irectly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

vi The company has no 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.

vii The company holds all the title deeds of immovable properties in its name.

viii The company is not declared as wilful defaulter by any bank or financial Institution or other lender.

29 The previous year''s figures have been regrouped / rearranged wherever necessary to make it comparable with the current year.

Mar 31, 2022

In the previous year the Company through Qualified Institutional Placement (QIP) allotted 80,47,210 equity shares to the eligible Qualified Institutional Buyers (QIBs) at a issue price of H932/- per equity share (including a premium of H930 per equity share) aggregating to H750 Crores on 7^th August, 2020. The issue was made in accordance with the SEBl (Issue of Capital and Disclosure Requirements) Regulations, 2018 as amended (the "SEBI ICDR Regulations"), and Sections 42 and 62 of the Companies Act, 2013, as amended, including the rules

made thereunder (the "Issue"). Funds received pursuant to QIP are being utilised towards the object stated in the piacement document.

Expenses incurred by the company aggregating to H15.92 Crores, in connection with QIP have been utilised out of general reserve in March 2021.

The rights, preferences and restrictions including restrictions on the distribution of dividends and the repayment of capital

The Company is having only one class of shares i.e. Equity carrying a nominal value of H2/- per share. Every holder of the equity share of the Company is entitled to one vote per share held. In the event of liquidation of the Company, the equity shareholders wiii be entitled to receive remaining assets of the Company after the distribution / repayment of aii creditors. The distribution to the equity shareholders wiii be in proportion of the number of shares held by each shareholder.

Nature and purpose of each Reserve

General Reserve:- The reserve is created by transfer of a portion of the net profit.

Securities Premium:- Securities premium is used to record the premium on issue of shares. The reserve can be utilised in accordance with provisions of the Companies Act, 2013.

Debenture Redemption Reserve: The company has created and continue to create debenture redemption reserve out of the profits as prudent practice in accordance with erstwhile provision of Companies Act, 2013. Other Comprehensive Income (OCI): Represents remeasurements of the defined benefits plan and fair value change of certain financial instruments.

Segment Reporting

Segment information as required under Ind AS 108 i.e. Operating Segments is given in the Consolidated financial statements of the Company.

A description of methods used for sensitivity analysis and its limitations:

Sensitivity analysis is performed by varying single parameter while keeping all the other parameters unchanged. Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously. The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change, if any.

Major risk to the plan

B. Investment Risk: For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.

C. Liquidity Risk: Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign/retire from the company there can be strain on the cash flows.

E. Legislative Risk: Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation/regulation. The government may amend the Payment of Gratuity Act thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the Defined Benefit Obligation and the same will have to be recognized immediately in the year when any such amendment is effective.

6 Provident Fund

i The Company directly and through Alembic CSR Foundation, Implementing Agency has spent the amount referred in (b) above on CSR activities such as Covid Relief/Prevention activities, Vaccination drive and Ex-gratia to casual workers, Healthcare including preventive healthcare, Education, Sanitation, Promotion and development of traditional arts and handicrafts, Adoption of Schools in tribal/backward areas, Rural development projects, Livelihood Enhancement and Disaster relief.

ii Refer Note 28 (7) for related party transactions.

Level 2 inputs are inputs other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly.

Level 3 inputs are unobservable inputs for the asset or liability.

Refer Note 5, 7, 8, 9, 10, 11, 15, 28(23), 18, 19, 20.

The Fair values of unquoted investment in Limited liability partnerships is arrived by Net Asset Value (''NAV'') method under Cost Approach by external valuation agency. The valuation is carried out based on provisional financial statement of ABCD Technologies LLP as at 31^st March, 2022. With respect of fair value of investment in preference shares of 5% optionally convertible preference shares, transaction price is considered as fair value as at 31^st March, 2022.

18 Financial Risk management

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

- Credit risk

- Liquidity risk and

- Market risk

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, and arises principally from the Company''s receivables from customers, Deposit, Cash and cash equivalents and other receivables.

Trade receivables

The Company''s exposure to credit risk is influenced mainly by the individual characteristics of each customer, demographics of the customer, default risk of the industry and country in which the customer operates. Credit risk is managed 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 has used expected credit loss model for assessing the impairment loss.

Cash and cash equivalents

As at the year end, the Company held cash and cash equivalents of H13.56 Crores (PY H53.66 Crores). The cash and cash equivalents, other bank balances and derivatives are held with banks having good credit rating.

Other financial assets

Other financial assets are neither past over due nor impaired.

ii) Liquidity risk

iii) Market risk Currency Risk

Sensitivity analysis

For the year ended 31^st March, 2022 every 5% weakening of Indian Rupee as compare to the respective major currencies for the above mentioned financial assets/LiabiLities would increase Company''s profit and equity by approximately H34.39 Crores (PY H8.22 Crores). A 5% strengthening of the Indian Rupee as compare to the respective major currencies would lead to an equal but opposite effect.

Interest rate risk and Exposure to interest rate risk

The Company has no any loan facilities carrying floating interest rate, which exposes the company to risk of changes in interest rates.

Commodity rate risk

Other Risk

Since company has been significantly dealing in regulatory market, continuous compliance of all manufacturing facilities is pre requisite. Any adverse action by regulatory authority of the company''s target market can adversely affect company''s operation.

19 Capital Management

The Company''s capital management objectives are:

* to ensure the Company''s ability to continue as a going concern and

* to provide an adequate return to shareholders through optimisation of debts and equity balance.

Dividend on equity shares

The Board has approved re-classification of the dividend for the financial year 2021-22 (H10/- per equity share i.e. 500%) recommended at its meeting held on 2nd May, 2022 into interim dividend for the financial year 2021-22 and have paid the same subsequently till the date of this report. No further final dividend for the financial year 2021-22 shaLL be decLared.

20 I n the financial year 2020-21 H0.49 Crores interest on income tax included in finance cost charged to statement of profit and Loss.

22 Disaggregation of revenue

The Company is engaged in Pharmaceuticals business considering nature of products, revenue can be disaggregated as API business and Formulation business H938.02 Crores and H4097.39 Crores respectively, and considering Geographical business, revenue can be disaggregated as in India H2098.29 Crores and out side India H2937.12 Crores.

26 The Company has working capital borrowing from banks on the basis of security of current asset and quarterly returns filed by the Company with banks are in agreement with the books of accounts.

27 Business Combination

The Board of Directors of the Company had at their meeting held on 29^th March, 2022 inter alia approved the Scheme of Arrangement in nature of Amalgamation of Aleor Dermaceuticals Ltd. (''the Transferor Company''/''Aleor'') engage in business of Pharmaceuticals with Alembic Pharmaceuticals Ltd. (''the Transferee Company'') and their respective shareholders (''the Scheme'') with effect from the appointed date i.e. 1^st April, 2021. The said Scheme has been sanctioned by the Hon''ble National Company Law Tribunal, Ahmedabad Bench ("NCLT") vide its Order dated 29^th August, 2022. The Scheme is now effective upon filing of the certified copy of the said Order with Registrar of Companies, Gujarat/Ministry of Corporate Affairs. Accordingly, the Board has approved the financial statements after giving effect to the Scheme.

As per Ind AS - 103, the financial information in the financial statements in respect of prior period is required to be restated as if the business combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the actual date of the combination, Accordingly the Company has restated the financials of the comparative period, on account of Amalgamation of Aleor. The transaction does not have any impact on the consolidated financial statement.

The Standalone Financial Statements for the year ended 31^st March, 2022 were earlier approved by Board of Director on 2^nd May, 2022 on pre-Amalgamation basis. Pursunt to the approval of the Scheme by Hon''ble NCLT, this Standalone Financcial Statement for the year ended 31^st March, 2022 have been revised as per scheme by applying the principles as set out in Appendix C of Ind As 103 "Business Combination" and intercompany balances and inter-company investments between both companies shall stand cancelled. The financial statements of Aleor for the year ended on March 31, 2022 and March 31, 2021 were audited by statutory auditor of Aleor.

28 Other Statutory information

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

ii The company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

iii The company have not traded or invested in Crypto currency or Virtual Currency during the period/year.

iv The company have not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

vii The company holds all the title deeds of immovable properties in its name.

viii The company is not declared as willful defaulter by any bank or financial Institution or other lender.

29 The previous year''s figures have been regrouped / rearranged wherever necessary to make it comparable with the current year.

Mar 31, 2019

1. General information

Alembic Pharmaceuticals Limited is principally engaged in the manufacturing and selling of Pharmaceuticals products i.e. Formulations and Active Pharmaceutical Ingredients. The Company is the public limited Company domiciled in India and is incorporated under the provision of the Companies Act applicable in India. Its shares are listed on the two recognised Stock Exchanges in India. The registered office of the Company is located at Alembic Road, Vadodara -390 003, India.

The Financial Statements are approved by the Companyâs Board of Directors on 8^th May, 2019

The rights, preferences and restrictions including restrictions on the distribution of dividends and the repayment of capital

The Company is having only one class of shares i.e. Equity carrying a nominal value of Rs. 2/ - per share Every holder of the equity share of the Company is entitled to one vote per share held. In the event of liquidation of the Company, the equity shareholders will be entitled to receive remaining assets of the Company after the distribution / repayment of all creditors. The distribution to the equity shareholders will be in proportion of the number of shares held by each shareholder.

Nature and purpose of each Reserve

Capital Reserve: Capital Reserve is created on receipt of Government subsidy for setting up factory in backward area. General Reserve: The reserve is created by transfer of a portion of the net profit.

Debenture redemption reserve: The Company is required to create a debenture redemption reserve out of the profits in accordance with Companies Act, 2013.

iii Contingent Asset

Interest on Investments made in 10% Secured Redeemable Non-Convertible Debentures of Rs. 300.00 Crores, 10% Unsecured Redeemable Non-Convertible Debentures of Rs.172.50 Crores of the 60% Subsidiary Company Aleor Dermaceuticals Limited which are carried at cost as per para 10 of Ind AS 27 âSeparate Financial Statementsâ.

As per terms of the JV agreement and securities subscription agreement entered into between the Company and Aleor Dermaceuticals Limited âno interest shall accrue and be payable unless the subsidiary company earns cash profitsâ. There is a long gestation period involved in the construction and commissioning of manufacturing facility, technology transfer and scale up of R&D projects, filing of ANDA application with USFDA and approval of ANDAâs by USFDA before the said subsidiary company can start manufacturing and marketing the products on commercial basis. Even thereafter, as projected, there will be some time before the company can start making cash profits. During the intervening period, there will be many uncertainties which may delay the entire process and start yielding financial and economic benefits that are as intended by the management.

Further, in terms of the said agreements, the tenure of NCD shall be of 9 years from the date of allotment of first tranche and in the event of default, i.e., if Subsidiary Company fails to redeem the NCD, the Company has a right to exercise the warrants held by it and to receive Equity shares of the subsidiary company.

As at the Balance Sheet date, no operational profits have been earned by the subsidiary company. As per the cash flows and profitability projections made by the subsidiary company, no operational profits are envisaged to be earned in a near future of say up to 3 years. Accordingly, there is no certainty of the date of the realization of interest and principal amounts and the net present value of the said receivables cannot be determined with reasonable accuracy.

In view of the aforesaid reasons and on the grounds of prudence, the Company has not recognized the interest income on the said investment. However since Company has a conditional right to receive interest on the above investments at the specified coupon rate amounting to Rs. 40.35 Crores for the year and accumulated till the year-end of Rs.61.63 Crores is considered as Contingent asset.

2. Disclosure required under Micro, Small and Medium Enterprise Development Act, 2006

On the basis of confirmation obtained from the supplier who have registered themselves under the Micro, Small and Medium Enterprise Development Act, 2006 (MSMED Act, 2006), details are as below

3. Segment Reporting

Segment information as required under Ind AS 108 i.e. Operating Segments is given in the Consolidated financial statements of the Company

4. Defined benefit plans / compensated absences - As per actuarial valuation

The following table sets out the funded status of the gratuity plan and the amounts recognised in the Companyâs financial statements as at 31^st March, 2019

A description of methods used for sensitivity analysis and its Limitations:

Sensitivity analysis is performed by varying single parameter while keeping all the other parameters unchanged. Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously. The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change if any

5. Provident Fund

The Company is liable for any shortfall in the fund assets based on the Government specified rate of return. Such shortfall, if any, is recognised in the Statement of Profit and Loss as an exprense in the year of incurring the same. There is no interest short fall as at 31 March, 2019 and 31^st March, 2018.

6. (i) Disclosures in respect of Related Parties transactions

(A) Controlling Companies: Nirayu Pvt. Limitec

(B) Subsidiaries including step down subsidiaries

1 Aleor Dermaceuticals Limited (Subsidiary of Alembic Pharmaceuticals Limited)

2 Alembic Global Holding SA (Subsidiary of Alembic Pharmaceuticals Limited)

3 AG Research Private Limited (Subsidiary of Alembic Pharmaceuticals Limited) (up to 22.01.2019)

4 Alembic Pharmaceuticals Australia Pty Ltd. (Subsidiary of Alembic Global Holding SA)

5 Alembic Pharmaceuticals Europe Ltd. (Subsidiary of Alembic Global Holding SA)

6 Alnova Pharmaceuticals SA (Subsidiary of Alembic Global Holding SA)

7 Alembic Pharmaceuticals Inc. (Subsidiary of Alembic Global Holding SA)

8 Alembic Pharmaceuticals Canada Ltd. (Subsidiary of Alembic Global Holding SA)

9 Genius LLC (Subsidiary of Alembic Global Holding SA)

10 Orit Laboratories LLC (Subsidiary of Alembic Pharmaceuticals Inc.)

11 Okner Realty LLC (Subsidiary of Alembic Pharmaceuticals Inc.)

1 Incozen Therapeutics Pvt. Limited (Associate of Alembic Pharmaceuticals Limited)

2 Rhizen Pharmaceuticals SA (Associate of Alembic Global Holding SA)

3 Dahlia Therapeutics SA (Subsidiary of Rhizen Pharmaceuticals SA)

4 Rhizen Pharmaceuticals Inc. (Subsidiary of Rhizen Pharmaceuticals SA)

(D) Joint Venture

1 Alembic Mami SPA (Joint venture of Alembic Global Holding SA)

(E) Other Related Parties

1 Alembic Limited 4 Viramya Packlight LLP

2 Shreno Limited 5 Shreno Publications Limited

3 Paushak Limited

(F) Key Management personnel

1 Mr. Chirayu Amin Chairman & CEO

2 Mr. Pranav Amin Managing Director

3 Mr. Shaunak Amin Managing Director

4 Mr. R. K. BahetiDirector Finance & CFO

5 Mr. K. G. Ramnathan Non-Executive Director

6 Mr. Pranav Parikh Non-Executive Director

7 Mr. Paresh Saraiya Non-Executive Director

8 Mr. Milin Mehta Non-Executive Director (upto 22^nd January, 2019)

9 Ms. Archana HingoraniNon-Executive Director

10 Mr. Ajay Kumar DesaiSr. Vice President - Finance & Company Secretary (upto 31^st May, 2018)

11 Mr. Charandeep Singh Saluja Company Secretary (From 1^st June 2018)

(G) Relatives of Key Management Personnel

1 Mrs. Malika Amin 4 Mrs. Jyoti Patel

2 Mr. Udit Amin 5 Mrs. Ninochaka Kothari

3 Ms. Yera Amin 6 Mrs. Shreya Mukherjee

ii) Nirayu Private Limited has become holding company of Alembic Pharmaceuticals Limited during the financial year 2017-18 based on clarifications and advice received regarding direct and indirect holding through its subsidiaries and step down subsidiaries. The disclosures made in the financial statements in related party transactions and controlling entity information have been modified accordingly. This does not have any impact on the financials of the Company in any way

During the year ended 31^st March, 2019, the Company did not recognise deferred tax assets of Rs. 280.59 Crores on MAT credit entitlement, as the Company believes that utilization of same is not probable. The above MAT credit expire at various dates ranginc from 2026 through 2035.

7. Expenses pending capitalisation included in Capital Work-in-Progress represent direct attributable expenditure for setting up of plants yet to commence of commercial operation, the detail of expenses are

8. Corporate Social Responsibility

As per section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities A CSR Committee has been formed by the Company as per the Act. The company spent Rs. 14.28 crores on various projects during the year refer Annexure - A included in the Boardâs Report.

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date

Level 2 inputs are inputs other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly Level 3 inputs are unobservable inputs for the asset or liability.

9. Financial Risk management

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

- Credit risk;

- Liquidity risk; and

- Market risk

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, and arises principally from the Companyâs receivables from customers, Deposit and other receivables.

Trade receivables

The Companyâs exposure to credit risk is influenced mainly by the individual characteristics of each customer, demographics of the customer, default risk of the industry and country in which the customer operates. Credit risk is managed 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 has used expected credit loss model for assessing the impairment loss.

Cash and cash equivalents

As at the year end, the Company held cash and cash equivalents of Rs. 144.25 Crores (PY: Rs. 9.45 Crores). The cash and cash equivalents other bank balances and derivatives are held with bank with good credit rating.

Other financial assets

Other financial assets are neither past over due nor impaired.

ii) Liquidity risk

The Company is rated by leading credit agency CRISIL, the rating âCRISIL A1 â and âAA /Stableâ has been assigned for short-term and long-term facility respectively, indicating high degree of safety regarding timely payment and servicing of financial obligation.

Exposure to liquidity risk

The following are the remaining contractual maturities of undiscounted financial liabilities at the reporting date.

iii) Market risk

Currency Risk

The Companyâs foreign exchange risk arises from its foreign operations, foreign currency revenues and expenses. The Company uses foreign exchange option contracts, to mitigate the risk of changes in foreign currency exchange rates in respect of its budgeted business transactions and recognised assets and liabilities. The Company enters into foreign currency options contracts which are not intended for trading or speculative purposes but for hedge purposes.

Sensitivity analysis

For the years ended 31^st March, 2019 and 31^st March, 2018 every 5% weakening of Indian Rupee as compared to the respective major currencies for the above-mentioned financial assets/liabilities would increase Companyâs profit and equity by approximately Rs. 22.15 Crores and Rs. 19.87 Crores respectively. A 5% strengthening of the Indian Rupee as compare to the respective major currencies would lead to an equal but opposite effect.

Interest rate risk and Exposure to interest rate risk

The Company has loan facilities on floating interest rate, which exposes the Company to risk of changes in interest rates.

For the years ended 31^st March, 2019 and 31^st March, 2018, every 50 basis point decrease in the floating interest rate component applicable to its loans and borrowings would decrease the Companyâs interest cost by approximately Rs. 5.30 Crores and Rs. 3.11 Crores respectively. A 50 basis point increase in floating interest rate would have led to an equal but opposite effect.

Commodity rate risk

The Companyâs 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.

Since company has been significantly dealing in regulatory market, continues compliance of all manufacturing facilities is pre requisite. Any adverse action by regulatory authority of the companyâs target market can adversely affect companyâs operation.

10. Capital Management

The Companyâs capital management objectives are:

* to ensure the Companyâs ability to continue as a going concern; and

* to provide an adequate return to shareholders through optimisation of debts and equity balance.

The Company monitors capital on the basis of the carrying amount of debt less cash and cash equivalents as presented on the face of the financial statements. The Companyâs objective for capital management is to maintain an optimum overall financial structure.

Dividend on equity shares paid during the year

The Board of Directors has recommended dividend on Equity Shares at Rs. 5.50 per share i.e. 275% for the year ended on 31^st March, 2019. Dividend Proposed by the Board of Directors is subject to approval of the shareholders at the ensuing Annual General Meeting.

During the year dividend of Rs. 75.41 Crores (Rs. 4.00 Per Shares i.e. 200%) and corporate tax of Rs. 15.35 Crores paid to the equity shareholders after the AGM approval for financial year 2017-18.

11. Donation includes political contributions of Rs.0.50 Crores through Electoral Bond.

12. Govertment Grant

The Company is entitled to subsidy, on its investment in the property, plant and equipment on fulfilment of the conditions stated in those Scheme. During year company has received Rs. 17.15 Crores as subsidy on investment in property, plant and equipment and Rs.0.06 Crores as reimbursement of expense. The same is accounted as stated in accounting policy on Government Grant (Refer Note No. 2(25)).

13. Revenue Recognition

The company has applied Ind As 115 âRevenue from contracts with customersâ with effect from 1^st April, 2018. Ind As 115 provides a single, principles-based approach to the recognition of revenue from all contracts with customers. It focuses on the identification of performance obligations in a contract and requires revenue to be recognised when or as those performance obligations are satisfied.

The company has adopted Ind As 115 applying the cumulative catch-up transaction approach. Ind As 115 did not have a material impact on the amount or timing of recognition of reported revenue.

The Company is engaged in Pharmaceuticals business considering nature of products, revenue can be disaggregated as API business and Formulation business Rs. 761.00 Crores and Rs. 2899.27 Crores respectively, and considering Geographical business, Revenue can be disaggregated as in India Rs. 1507.60 Crores and out side India Rs. 2152.67 Crores.

14. The Company has obtained and given certain premises for its business operations under operating lease or leave and licence agreements. These are generally not non-cancellable and are renewable by mutual consent on mutually agreeable terms.

Lease receipts / payments are recognised in the statement of profit and loss under âLease Rent Incomeâ & âRentâ in Note 22 and 26 respectively.

15. Borrowing cost of Rs. 60.20 Crores (PY Rs. 22.61 Crores) capitalised @ rate of 7.45%.

16. Recent Accounting Pronouncements

Ind AS 116 Leases : On 30^th March, 2019 Ministry of Corporate Affairs has notified Ind AS 116, Leases. Ind AS 116 will replace the existing leases Standard, Ind AS 17 Leases, and related Interpretations. The Standard sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract i.e., the lessee and the lessor. Ind AS 116 introducing lessee accounting model and requires a lessee to recognize assets and liabilities for all leases with a term of more than twelve months, unless the underlying asset is of low value. Currently, operating lease expenses are charged to the statement of Profit & Loss. The Standard also contains enhanced disclosure requirements for lessees. Ind AS 116 substantially carries forward the lessor accounting requirements in Ind AS 17. The Company is in process of evaluating the impact of the same.

17. The previous yearâs figures have been regrouped / rearranged wherever necessary to make it comparable with the current year.

Mar 31, 2018

1 General information

Alembic Pharmaceuticals Limited is principally engaged in the manufacturing and selling of Pharmaceuticals products i.e. Active Pharmaceutical Ingredients and Formulations. The Company is the public limited Company domiciled in India and is incorporated under the provision of the Companies Act applicable in India. Its shares are listed on the two recognised Stock Exchanges in India. The registered office of the Company is located at Alembic Road, Vadodara - 390 003, India.

The Financial Statements are approved by the Companyâs Board of Directors on 16^th May, 2018

The rights, preferences and restrictions including restrictions on the distribution of dividends and the repayment of capital

The company is having only one class of shares i.e. Equity carrying a nominal value of Rs.2/- per share Every holder of the equity share of the Company is entitled to one vote per share held. In the event of liquidation of the Company, the equity shareholders will be entitled to receive remaining assets of the Company after the distribution / repayment of all creditors. The distribution to the equity shareholders will be in proportion of the number of shares held by each shareholder.

Nature and purpose of each Reserve

Capital Reserve :- Capital Reserve is created on receipt of Government subsidy for setting up factory in backward area. General Reserve :- The reserve is created by transfer of a portion of the net profit.

iii Contingent Asset

(a) As per JV agreement, the interest on NCD issued by Aleor and subscribed by company will start accruing only when Aleor starts making cash profit. Since in pharma industry the gestation period is long and there is significant uncertainty as to when JV will start making profit, the fair value of such contingent asset is not ascertainable.

(b) The company has made application to Department of Industrial Policy and Promotion for subsidy for setting new plant in Sikkim. The same is yet to be approved by the relevant authorities. Also large number of claims of various companies (who set up their plants much before ours) are pending. Hence, the quantification of fair value of such subsidy are unascertainable.

2 Disclosure required under Micro, Small and Medium Development Act, 2006

To the basis of confirmation obtained from the supplier who have registered themselves under the Micro, Small and Medium Enterprise Development Act, 2006 (MSMED Act, 2006) and based on the information available with the company the following are the details.

3 Segment Reporting

Segment information as required under Ind AS 108 - âOperating Segmentsâ is given in the Consolidated financial statements of the Company

4 Defined benefit plans / compensated absences - As per actuarial valuation

The following table sets out the funded status of the gratuity plan and the amounts recognized in the Companyâs financial statements as at 31^st March, 2018

A description of methods used for sensitivity analysis and its Limitations:

Sensitivity analysis is performed by varying single parameter while keeping all the other parameters unchanged. Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously. The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change if any.

5 Disclosures in respect of Related Parties transactions

(a) Controlling Companies: There is no controlling Company

(b) Subsidiary and Fellow Subsidiary

1 Alembic Global Holding SA (Subsidiary of Alembic Pharmaceuticals Limited)

2 Alembic Pharmaceuticals Australia Pty Ltd. (Subsidiary of Alembic Global Holding SA)

3 Alembic Pharmaceuticals Europe Ltd. (Subsidiary of Alembic Global Holding SA)

4 Alnova Pharmaceuticals SA (Subsidiary of Alembic Global Holding SA)

5 Alembic Pharmaceuticals Inc (Subsidiary of Alembic Global Holding SA)

6 Alembic Pharmaceuticals Canada Ltd. (Subsidiary of Alembic Global Holding SA)

7 AG Research Private Limited (Subsidiary of Alembic Pharmaceuticals Limited)

8 Genius LLC (Subsidiary of Alembic Global Holding SA)

9 Orit Laboratories LLC (Subsidiary of Alembic Pharmaceuticals Inc)

10 Okner Realty LLC (Subsidiary of Alembic Pharmaceuticals Inc)

11 Aleor Dermaceuticals Limited (Subsidiary of Alembic Pharmaceuticals Limited)

1 Incozen Therapeutics Pvt. Limited

2 Rhizen Pharmaceuticals SA (Associate of Alembic Global Holding SA)

3 Dahlia Therapeutics (Wholly Owned Subsidiary of Rhizen Pharmaceuticals SA)

4 Rhizen Pharmaceuticals Inc (Wholly Owned Subsidiary of Rhizen Pharmaceuticals SA)

(d) Joint Venture

1 Alembic Mami SPA, (Joint venture of Alembic Global Holding SA.)

(e) Other Related Parties

1 Alembic Limited 6 Sierra Investments Pvt. Limited (Up to 12^th December, 2017)

2 Nirayu Pvt.Limited 7 Viramya Packlight LLP (Formally Known as Viramya Packlight Ltd)

3 Shreno Limited 8 Shreno Publications Limited

4 Paushak Limited 9 Whitefield Chemtech Pvt. Limited (up to 12^th December, 2017)

5 Quick Flight Limited (up to 9^th May, 2017)

(f) Key Management Personnel

1 Mr. Chirayu Amin Chairman & CEO

2 Mr. Pranav Amin Managing Director

3 Mr. Shaunak Amin Managing Director

4 Mr. R. K. Baheti Director Finance & CFO

5 Mr. K. G. Ramnathan Non-Executive Independent Director

6 Mr. Pranav Parikh Non-Executive Independent Director

7 Mr. Paresh Saraiya Non-Executive Independent Director

8 Mr. Milin Mehta Non-Executive Independent Director

9 Ms. Archana Hingorani Non-Executive Independent Director

10 Mr. Ajay Kumar Desai Sr. Vice President - Finance & Company Secretary

(g) Relatives of Key Management Personnel :

1 Mrs. Malika Amin

2 Mr. Udit Amin

3 Ms. Yera Amin

4 Ms. Jyoti Patel

5 Mrs. Ninochaka Kothari

6 Mrs. Shreya Mukherjee

6 Pre-operative expenses pending capitalisation included in Capital Work-In-Progress represent direct attributable expenditure for setting up of plants commencement of commercial operation. The detail of pre-operative expenses are:

7 Corporate Social Responsibility

As per section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. A CSR Committee has been formed by the Company as per the Act. The company spent Rs.7.14 Crores on various projects during the year refer Annexure - A (point no 5) included in the Boardâs Report.

Level 1 Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly.

Level 3 inputs are unobservable inputs for the asset or liability.

In case of investment in equity instuments, cost has been considerd as approximate fair value in view of materiality of value of investment.

8 Financial Risk management

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

- Credit Risk;

- Liquidity Risk; and

- Market Risk

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, and arises principally from the Companyâs receivables from customers, deposit and other receivables.

Trade receivables

Cash and cash equivalents

As at the year end, the Company held cash and cash equivalents of Rs.9.45 Crores (31^st March, 2017 - Rs.0.69 Crores). The cash and cash equivalents other bank balances and derivatives are held with bank with good credit rating.

Other financial assets

Other financial assets are neither past due nor impaired.

ii) Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligation as they fall due. The Company ensure that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions. The Company has sufficient unutilised fund and non fund based working capital credit limit duly sanctioned by various banks.

The company is rated by leading credit agency CRISIL, the rating âCRISIL A1 â and âAA /Stableâ has been assigned for short term and long term facility respectively, indicating high degree of sefty regarding timely payment and servicing of financial obligation.

Exposure to liquidity risk

The following are the remaining contractual maturities of undiscounted financial liabilities at the reporting date.

iii) Market Risk

Currency Risk

The Companyâs foreign exchange risk arises from its foreign operations, foreign currency revenues, expenses and borrowings. The Company uses foreign exchange forward contracts and option contracts, to mitigate the risk of changes in foreign currency exchange rates in respect of its budgeted business transactions and recognized assets and liabilities. The Company enters into foreign currency options and forward contracts which are not intended for trading or speculative purposes but for hedge purposes.

The Companyâs exposure to foreign currency risk at the end of the reporting period expressed in INR, are as follows:

Sensitivity analysis

For the years ended 31^st March, 2018 and 31^st March, 2017 every 5% weakening in the exchange rate between the Indian Rupee and the respective major currencies for the above mentioned financial assets/liabilities would increase Companyâs profit and equity by approximately Rs.19.87 Crores and Rs.14.96 Crores respectively. A 5% strengthening of the Indian Rupee and the respective major currencies would lead to an equal but opposite effect.

Interest Rate Risk and Exposure to Interest Rate Risk

The Company has loan facilities on floating interest rate, which exposes the company to risk of changes in interest rates.

For the years ended 31^st March, 2018 and 31^st March, 2017, every 50 basis point decrease in the floating interest rate component applicable to its loans and borrowings would decrease the Companyâs loss by approximately Rs.3.11 Crores and Rs.0.04 Crores respectively. A 50 basis point increase in floating interest rate would have led to an equal but opposite effect.

Commodity Rate Risk

Other Risk

Since Company is significantly dealing in regulatory market, continuous compliance of all manufacturing facilities is pre requisite, any adverse action by regulatory authority of the Companyâs target market can adversely affect its operation.

9 Capital Management

The Companyâs capital management objectives are:

* to ensure the Companyâs ability to continue as a going concern; and

* to provide an adequate return to shareholders through optimisation of debts and equity balance.

Dividend on equity shares paid during the year

During the year ended 31^st March, 2018 dividend of Rs.4 per equity share was paid to the equity shareholders after the AGM approval. Rs.75.41 Crores and corporate tax of Rs.15.35 in relation to FY 2016-17

The Board of Directors has recommended dividend on Equity Shares at Rs.4 per share i.e. 200% for the year ended on 31^st March, 2018. Dividend Proposed by the Board of Directors is subject to approval of the shareholders at the ensuing Annual General Meeting.

10 Donation includes political contributions of Rs.6 Crores to Bharatiya Janata Party.

11 Recent Accounting Pronouncements

On 28^th March, 2018 Ministry of Corporate Affairs has notified the Ind AS 115, Revenue form Contract with Customers. The core principle of the new standard is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The company will adopt the standard on 1^st April, 2018 by using the cumulative catch-up transition method and accordingly comparatives for the year ended 31^st March, 2018 will not be retrospectively adjusted. the effect on adoption of Ind As 115 on the operations of the company is being assessed by the company.

12 The Company has obtained certain premises for its business operations under operating lease or leave and license agreements. These are generally not non-cancellable and are renewable by mutual consent on mutually agreeable terms.

Lease receipts / payments are recognised in the statement of profit and loss under âLease Rent Incomeâ and âRentâ in Note 22 and 25 respectively..

13 The previous yearâs figures have been regrouped / rearranged wherever necessary to make it comparable with the current year.

Mar 31, 2017

1.1 Description of Business

The Financial Statements are approved by the Companyâs Board of Directors on 3rd May, 2017.

1.2 Basis of preparation of financial statements

The financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) as prescribed under Section 133 of the Act to be read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies ( Indian Accounting Standards) Amendment Rules, 2016. The Companyâs Financial Statements for the year ended 31st March, 2017 comprises of the Balance Sheet, Statement of Profit and Loss, Cash Flow Statement, Statement of Changes in Equity and the Notes to Financial Statements.

For all periods up to and including the year ended 31 March 2016, the Company prepared its financial statements in accordance with Indian GAAP, including accounting standards specified under section 133 of the Companies Act, 2013 read with rule 7 of Companies (Accounts) Rules, 2015. The financial statements for the year ended 31st March 2017 are the first Financial Statements of the Company prepared in accordance with Ind AS based on the permissible options and exemptions available to the Company in terms of Ind AS 101 âFirst time adoption of Indian Accounting Standardsâ in Note No. 39 Reconciliations and descriptions of the effect of the transition have been summarized in Note No. 39.1

Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.

The financial statements have been prepared on a historical cost convention on the accrual basis, except for Derivative financial instruments which have been measured at fair value.

1.3 Fair Value Measurement

The Company measures financial instruments, such as, derivatives at fair value on reporting date based on an external report.

1.4 Significant Accounting Judgments, Estimates and Assumptions

In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Any change in these estimates and assumptions will generally be reflected in the financial statements in current period or prospectively, unless they are required to be treated retrospectively under relevant accounting standards.

2. Disclosure required under Micro, Small and Medium Development Act 2006

On the basis of confirmation obtained from the supplier who have registered themselves under the Micro, Small and Medium Enterprise Development Act, 2006 (MSMED Act, 2006) and based on the information available with the company the following are the details.

3 Segment Reporting

Segment information as required under Ind AS 108 i.e Operating Segments is given in the Consolidated Ind AS financial statements of the Company.

4 Disclosures in respect of Related Parties transactions

List of Related Parties with whom the Company has entered into transactions during the year.

(a) Controlling Companies: There is no controlling Company

(b) Subsidiary and Fellow Subsidiary

1 Alembic Global Holding SA (Subsidiary of Alembic Pharmaceuticals Limited)

2 Alembic Pharmaceuticals Australia Pty Ltd. (Subsidiary of Alembic Global Holding SA)

3 Alembic Pharmaceuticals Europe Ltd. (Subsidiary of Alembic Global Holding SA)

4 Alnova Pharmaceuticals SA (Subsidiary of Alembic Global Holding SA)

5 Alembic Pharmaceuticals Inc (Subsidiary of Alembic Global Holding SA)

6 Alembic Pharmaceuticals Canada Ltd. (Subsidiary of Alembic Global Holding SA)

7 AG Research Private Limited (Subsidiary of Alembic Pharmaceuticals Limited)

8 Genius LLC (Subsidiary of Alembic Global Holding SA)

9 Aleor Dermaceuticals Limited (Subsidiary of Alembic Pharmaceuticals Limited)

1 Alembic Limited

2 Whitefield Chemtech Pvt. Limited

3 Nirayu Pvt.Limited

4 Quick Flight Limited

5 Shreno Limited

6 Paushak Limited

7 Sierra Investments Private Limited

8 Viramya Packlight LLP

9 Incozen Therapeutics Pvt. Limited

10 Rhizen Pharmaceuticals SA (Associate of Alembic Global Holding SA)

11 Dahlia Therapeutics (Subsidiary of Rhizen Pharmaceuticals SA)

12 Rhizen Pharmaceuticals Inc (Subsidiary of Rhizen Pharmaceuticals SA)

(d) Joint Venture:

1 Alembic Mami SPA (Joint venture of Alembic Global Holding SA)

(e) Key Management personnel

1 Shri C .R. Amin Chairman & CEO

2 Shri R. K. Baheti Director - Finance & CFO

3 Shri Pranav Amin Managing Director

4 Shri Shaunak Amin Managing Director

5 Shri Ajay Desai Vice President - Finance & Company Secretary

(f) Relatives of Key Management Personnel :

1 Smt. Malika Amin

2 Shri Udit Amin

3 Ms. Yera Amin

4 Ms. Jyoti Patel

5 Ms.Ninochaka Kothari

6 Ms. Shreya Mukherjee

5 Corporate Social Responsibility

As per section 135 of the Companies Act, 2013, a company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceeding three financial years on corporate social responsibility (CSR) activities. A CSR Committee has been formed by the Company as per the Act. The company spent ?4.22 crores on various projects during the year, refer Annexure - A (point no. 5) included in the Boardâs Report.

6 Disclosure on Specified Bank Notes (SBNs)

During the year, the Company had specified bank notes (i.e. as provided in the notification no. S.O. 3407(E), dated 8th Nov, 2016 issued by the Government of India) or other denomination note as defined in the MCA notification G.S.R. 308 (E) dated 31st March, 2017, on the details of Specified Bank Notes (SBN) held and transacted during the period from 8th November, 2016 to 30th December, 2016, the denomination wise SBNs and other notes as per the notification is given below:

7. First Time Adoption of Ind AS

These are the Companyâs first financial statements prepared in accordance with Ind AS

The significant accounting policies set out in note 2 have been applied in preparing the financial statements for the year ended 31st March, 2017, the comparative information presented in these financial statements for the year ended 31st March, 2016, and in the preparation of an opening Ind AS balance sheet at 1st April, 2015 ( the Companyâs date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies ( Accounting Standards) Rules, 2006 (as amended) and the other relevant provisions of the Act (previous GAAP or Indian GAAP).

A. Exemptions and exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions applied in the transition from previous GAAP to Ind AS

A.1. Ind AS optional exemptions

A.1.1 Business Combinations

The Company has elected to apply Ind AS 103 prospectively to business combinations occuring after its transition date.

Business Combinations occuring prior to the transition date have not been restated. The Company has applied same exemption for investment in associates and joint venture.

The Company has elected not to apply Ind AS 21 retropectively to fair value adjustment and goodwill arising in business combination that occurred prior to the transition date

A.1.2 Deemed cost

The Company has elected to measure all of its property, plant and equipment at their previous GAAP carrying value i.e deemed cost.

A.1.3. Investments in subsidiaries, associates and joint venture

The Company has elected to measure all of its investments in subsidiaries, associates and joint venture at their previous GAAP carrying value.

An explanation of how the transition from previous GAAP to Ind AS has affected the Companyâs financial position, financial performance and cash flows is set out in the following tables and notes.

8.1 Reconciliations

The following reconciliations provides the effect of transition to Ind AS from IGAAP in accordance with Ind AS 101

1. Equity as at 1st April, 2015 and 31st March, 2016

2. Net profit for the year ended 31st March, 2016

8.1.1 Reconciliation of equity as previously reported under IGAAP to Ind AS

8.1.2 Impact of Ind AS adoption on the statement of cash flow for the year ended 31st March, 2016

The transition from previous GAAP to Ind AS has not affected the cash flows of the Company.

9 The previous yearâs figures have been regrouped / rearranged wherever necessary to make it comparable with the current year.

Mar 31, 2013

I Segment Reporting

Primary Segment

The Company has identified "Pharmaceuticals" as the only primary reportable segment.

In view of the inter-woven/inter-mixed nature of business and manufacturing facility other secondary segmental information is not ascertainable.

II Disclosures in respect of Related Parties pursuant to Accounting standard - AS 18 - issued by the Institute of Chartered Accountants Of India pursuant to Companies (Accounting Standards) Rules 2006 are as follows

List of Related Parties with whom the Company has entered into transactions during the yean

a) Controlling Companies: There is no controlling Company

b) Subsidiary and Fellow Subsidiary:

1 Alembic Global Holding SA (Subsidiary of Alembic Pharmaceuticals Limited)

2 Alembic Pharmaceuticals Australia Pty Ltd (Subsidiary of Alembic Global Holding SA.)

3 Alembic Pharmaceuticals Europe Ltd (Subsidiary of Alembic Global Holding SA.)

4 Alnova Pharmaceuticals SA (Subsidiary of Alembic Global Holding SA.)

5 Alembic Pharmaceuticals Inc. (Subsidiary of Alembic Global Holding SA.)

c) Associate Companies:

1 Alembic Ltd.

2 Whitefield Chemtech Pvt. Ltd.

3 Nirayu Pvt. Ltd.

4 Quick Flight Ltd.

5 Shreno Ltd.

6 Paushak Ltd.

7 Sierra Investments Ltd.

8 Viramya Packlight Ltd

9 Incozen Therapeutics Pvt. Ltd.

10 Rhizen Pharmaceuticals SA

d) Key Management personnel

1 Shri C .R. Amin Chairman and Managing Director

2 Shri R. K Baheti Director, President - Finance & Company Secretary

3 Shri Pranav Amin Director, President-International Business

4 Shri Shaunak Amin President - Formulations

e) Relatives of Key Management Personnel :

1 Smt. Malika Amin

2 Shri Udit Amin

3 Ms.Yera Amin

4 Ms. Jyoti Patel

5 Ms. Ninochaka Kothari

6 Ms. Shreya Mukherjee

III The previous year''s figures have been regrouped / rearranged wherever necessary to make it comparable with the current year

Mar 31, 2012

(a) The rights, preferences and restrictions including restrictions on the distribution of dividends and the repayment of capital;

The company is having only one class of shares i.e Equity carrying a nominal value of Rs 2/- per share Every holder of the equity share of the Company is entitled to one vote per share held

In the event of liquidation of the Company, the equity shareholders will be entitled to receive remaining assets of the Company after the distribution / repayment of all creditors. The distribution to the equity shareholders will be in proportion of the number of shares held by each shareholder

The Company declares and pays dividend on the equity shares in Indian Rupees. Dividend proposed by the Board of Directors is subject to approval of the shareholders at the ensuing Annual General Meeting

During the year ended 31st March, 2012 an amount of Rs 1.40 of dividend per equity share was proposed for the equity shareholders ( PY Rs 1/- per equity share)

i. Segment Reporting

Primary Segment

The Company has identified "Pharmaceuticals" as the only primary reportable segment.

In view of the inter-woven/inter-mixed nature of business and manufacturing facility, other secondary segmental information is not ascertainable.

ii During the year ended 31st March, 2012 the revised schedule VI notified under the Companies Act, I956 has become applicable to the Company for perperation and presentation of its financial statement. The adoption of revised schedule VI does not impact recongination and measurement principles followed for preparation of financial statements. However, it has significant impact on presentation and disclosures made in the financial statements. The company has also reclassified the previous year's figures in accordance with the requirements appliable in the current year. In view of this reclassification certain figures of current year are not strictly comparable with those of the previous year.

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