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Directors Report of Dr. Lal Pathlabs Ltd.

Mar 31, 2023

Your Directors have pleasure in presenting the 29^th Annual Report on the business and operations of your Company along with the audited statement of accounts for the financial year ended March 31,2023.

FINANCIAL RESULTS

The Financial performance of your Company for the year ended March 31,2023 is summarized below: (H in Million)
	Consolidated		Standalone
Particulars	Year ended March 31, 2023	Year ended March 31, 2022	Year ended March 31, 2023	Year ended March 31, 2022*
Total Income	20,586	21,400	18,156	19,319
Total Expenses	17,148	16,650	14,248	14,709
Profit/(Loss) before Tax (PBT)	3,438	4,750	3,908	4,610
Profit/(Loss) after Tax (PAT)	2,411	3,503	2,924	3,453
* These numbers have been restated pursuant to approval of Scheme of Amalgamation of APL Institute of Clinical Laboratory & Research Private Limited with the Company.

In addition, your Directors are pleased to recommend dividend of H 6/- per equity share of face value of H 10/-each as Final Dividend for the Financial Year 2022-23, for approval by the shareholders at the ensuing Annual General Meeting ("AGMâ) of the Company.

The Dividend Distribution Policy of the Company is attached herewith as Annexure-1 and forms an integral part of this Annual Report.

The said policy is also available on the website of the Company at: https://uat-cdn.drlallab.com/2023-06/ Dividend-Distribution-Policy.pdf

TRANSFER TO RESERVES

During the year under review, no amount has been transferred to the General Reserve of the Company from current year profits.

FINANCIAL PERFORMANCE

I. CONSOLIDATED PERFORMANCE

During the FY 2022-2023, the Company reported a Consolidated Total Income of H 20,586 Million compared to H 21,400 Million in the previous year. The Consolidated Net Profit After Tax of the Company stood at H 2,411 Million compared to H 3,503 Million in the previous year.

II. STANDALONE PERFORMANCE

During the FY 2022-2023, the Company reported a Standalone Total Income of H 18,156 Million compared to H19,319 Million in the previous year. The Standalone Net Profit After Tax of the Company stood at H 2,924 Million compared to H 3,453 Million in the previous year.

CONSOLIDATED ACCOUNTS

The consolidated financial statements of your Company for the Financial Year 2022-23, are prepared in compliance with applicable provisions of the Companies Act, 2013 (''the Actâ), Indian Accounting Standards ("Ind-ASâ) and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulationsâ). The consolidated financial statements have been prepared on the basis of audited financial statements of the Company and its Subsidiaries, as approved by their respective Board of Directors.

DIVIDEND

During the year under review, your Company paid dividends as under:

Date of Declaration

Dividend

Type

Financial

Year

Dividend Per Share (face value of J 10/- each)

June 30, 2022

Final

Dividend

2021-22

H 6/-

July 28, 2022

Interim

Dividend

2022-23

H 6/-

AMALGAMATION

The Board of Directors of your Company in their meeting on February 03, 2020, approved a Scheme of Amalgamation ("the Schemeâ) between Dr. Lal PathLabs Limited (the Company/Transferee Company) and APL Institute of Clinical Laboratory & Research Private Limited, a wholly owned subsidiary of the Company (APL/ Transferor Company), having its Registered Office in Ahmedabad, subject to requisite approvals under Section 230 to 232 of the Companies Act, 2013 ("the Actâ).

The Scheme was sanctioned by New Delhi and Ahmedabad Bench of Hon''ble National Company Law Tribunal (NCLT) on May 13, 2022 and March 17, 2023 respectively.

The certified true copies of the Order(s) of New Delhi and Ahmedabad Bench of Hon''ble NCLT were filed with respective Registrar of Companies - Delhi and Registrar of Companies - Ahmedabad on June 8, 2022 and March 27, 2023, respectively and consequent upon that APL stands amalgamated with the Company w.e.f March 27, 2023 (being the effective date).

Pursuant thereto and in accordance with the terms of the Scheme, APL gets amalgamated with the Company w.e.f. April 1, 2020 (being the appointed date) and consequently stands dissolved without being wound-up.

CHANGE IN SHARE CAPITAL

Authorized Share Capital

During the year under review, the authorized share capital of the Company has been increased from H 1,07,95,00,000/- divided into 10,79,50,000 equity shares of H 10/- each to H 1,07,96,00,000/- divided into 10,79,60,000 equity shares of H 10/-each, by virtue of the NCLT''s Order(s) passed for sanctioning the Scheme of Amalgamation of APL Institute of Clinical Laboratory & Research Private Limited with the Company.

Paid-up Share Capital

During the year under review, the paid-up equity share capital of the Company has been increased from H 83,34,48,770/- divided into 8,33,44,877 equity shares of H 10/- each to H 83,36,78,770/- divided into 8,33,67,877 equity shares of H10/- each pursuant to allotment of Equity Shares under the Employee Stock Option Plan 2010 of the Company as detailed below:

S. No	Date of Allotment	Number of Equity Shares allotted
1.	May 06, 2022	7,000
2.	January 03, 2023	2,000
3.	February 22, 2023	14,000
	TOTAL	23,000

Further, after the closing of financial year 2022-23 the paid-up equity share capital of the Company has also been increased from H 83,36,78,770/- divided into 8,33,67,877 equity shares of H 10/- each to H 83,41,48,770/- divided into H 8,34,14,877 equity shares of H 10/- each pursuant to allotment of Equity Shares under the Employee Stock Option Plan 2010 of the Company as detailed below:

S. No	Date of Allotment	Number of Equity Shares allotted
1.	April 12, 2023	16,000
2.	May 19, 2023	25,000
3.	July 13, 2023	6,000
	TOTAL	47,000

These Equity Shares are rank pari passu with the existing Equity Shares of the Company in all respects.

During the year under review, your Company has not issued any Equity Share with differential rights, Sweat Equity Shares or Bonus Shares.

EMPLOYEES STOCK OPTION PLAN / SCHEME

During the year under review, the Shareholders of the Company in their 28^th Annual General Meeting held on June 30, 2022 approved Dr. Lal PathLabs Employee Stock Option Plan, 2022 ("ESOP Plan, 2022").

Further, there has been no material change in the existing ESOP Plans of the Company viz. (i) Employee Stock Option Plan, 2010, (ii) Employee Restricted Stock Unit Plan, 2016 and (iii) Employee Stock Option Plan, 2022 and these Plans have been implemented in compliance with relevant/ applicable ESOP Regulations/ Guidelines.

The disclosure(s) as required under the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are disclosed on the website of the Company and can be accessed at https://uat-cdn.drlallab.com/2023-08/Information-as-per-SEBI-(SBEB)-Regulations-FY23.pdf

SUBSIDIARIES

A report on the performance and financial position of each of the subsidiaries and their contribution to the overall performance of the Company for the financial year ended March 31,2023 in Form AOC -1 as per the Companies Act, 2013 is attached herewith as Annexure-2 and forms an integral part of this Annual Report.

The annual accounts of the each of the subsidiaries shall also be made available to the Shareholders of the Company/ Subsidiary Companies seeking such information at any point of time. The annual accounts of the Subsidiary Companies are also available under investors section on the website of the Company at www.lalpathlabs.com

The Company has formulated a policy for determining material subsidiaries. The said policy is also available on the website of the Company at: https://uat-cdn. drlallab.com/2023-06/Policy-for-determining-Material-Subsidiaries.pdf

TRANSFER OF UN-CLAIMED IPO SHARE APPLICATION MONEY TO IEPF

During the year under review, pursuant to the provisions of Section 125 of the Companies Act, 2013 read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended from time to time, your Company has duly transferred Unclaimed IPO Share Application Money of H 12,59,200 (Rupees Twelve Lakh Fifty Nine Thousand Two Hundred only) to Investor Education and Protection Fund (IEPF) Account of Central Government.

The Claimant(s), whose unclaimed amount has been transferred by the Company to IEPF Account may claim their amount by complying with the procedure stipulated in the IEPF Rules.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

No material changes and commitments, other than disclosed as part of this report, affecting the financial position of the Company have occurred between March 31,2023 and the date of the report.

PUBLIC DEPOSITS

During the year under review, your Company has not accepted any deposit within the meaning of Section 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the prescribed format and annexed herewith as Annexure-3 and forms an integral part of this Annual Report.

Particulars of employee remuneration, as required under Section 197 (12) of the Companies Act, 2013 read with Rule 5 (2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms an integral part of this Annual Report. In terms of the provisions of the first proviso to Section 136 (1) of the Companies Act, 2013,

the Annual Report is being sent to Shareholders, excluding the aforementioned information. Any Shareholder interested in obtaining a copy of such statement may write to the Company Secretary of the Company at [email protected].

AUDIT COMMITTEE

The composition of Audit Committee has been detailed in the Corporate Governance Report, forming part of this Annual Report.

All recommendations made by the Audit Committee have been accepted by the Board of Directors.

DIRECTORS

I. Retirement by rotation and subsequent reappointment

Mr. Rahul Sharma (DIN: 00956625), Non-Executive Director of the Company is liable to retire by rotation at the ensuing Annual General Meeting ("AGMâ) pursuant to the provisions of Section 152 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and being eligible offers himself for re-appointment. Appropriate resolution for his reappointment is being placed for the approval by the Shareholders of the Company at the ensuing AGM.

A brief profile of Mr. Rahul Sharma and other related information is detailed in the Notice convening the 29^th AGM of your Company.

The Board considered the said re-appointment in the interest of the Company and hence recommends the same to the Shareholders for approval.

II. Appointment

The tenure of majority of the Independent Directors on the Board of the Company shall be coming to an end by August, 2023. In order to ensure smooth transition at the Board Level, the Board of Directors on recommendation of Nomination & Remuneration Committee and after evaluating balance of skills, knowledge and experience available on the Board, approved, the appointment of:

i. Mr. Rohit Bhasin (DIN: 02478962) as an Additional Director in the category of Independent Director, not liable to retire by rotation for a term of three (3) consecutive years beginning from November 8, 2022.

ii. Mr. Arun Duggal (DIN: 00024262) as an Additional Director in the category of Independent Director, not liable to retire by rotation for a term of three (3) consecutive years beginning from February 2, 2023.

Further, the Shareholders of the Company by way of Postal Ballot(s), approved the appointment of Mr. Rohit Bhasin and Mr.

Arun Duggal as Independent Directors of the Company on December 14, 2022 and March 10, 2023 respectively.

iii Mr. Gurinder Singh Kalra (DIN: 10197218) and Mr. Rajit Mehta (DIN: 01604819) appointed as Additional Directors in the category of Independent Directors not liable to retire by rotation for a term of three (3) consecutive years beginning from July 27, 2023, subject to the approval of Shareholders at the ensuing Annual General Meeting.

III. Declaration of Independence from Independent Directors

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149 of the Companies Act, 2013 and Rules made thereunder read with Schedule IV as well as the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In the opinion of the Board, all the Independent Directors fulfil the criteria of independence as specified in Companies Act, 2013 and Rules made thereunder read with Schedule IV as well as Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and they are independent from the Management.

Further, all the directors including Independent Directors of the Company possess appropriate skills, experience & knowledge in one or more fields viz. Board & Governance, Finance, Accounting & Finance Reporting, Information Technology and Specialized Industry & environmental knowledge or other disciplines related to Company''s business.

KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 2(51) and 203 of the Companies Act, 2013 read with Rules made thereunder, the following were the Key Managerial Personnel (KMPs) of the Company as on March 31, 2023:

1. (Hony) Brig. Dr. Arvind Lal - Executive Chairman

2. Dr. Om Prakash Manchanda - Managing Director

3. Dr. Vandana Lal - Whole Time Director

4. Mr. Bharath U - Chief Executive Officer

5. Mr. Ved Prakash Goel - Group Chief Financial Officer; and

6. Mr. Rajat Kalra - Company Secretary and Legal Head

Mr. Rajat Kalra, resigned as Company Secretary and Legal Head of the Company w.e.f. March 31, 2023 (closing of business hours).

Basis the recommendation of Nomination & Remuneration Committee, the Board of Directors appointed Mr. Vinay Gujral as Company Secretary (KMP) of the Company w.e.f May 11,2023.

ANNUAL EVALUATION OF BOARD''S PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board have carried out annual evaluation of (i) its own performance; (ii) Performance of Individual Directors; (iii) Performance of Chairman of the Board; and (iv) Performance of all the Committees of the Board for the Financial Year 2022-23.

A structured questionnaire was prepared covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Non-Independent Directors and Chairman of the Board was carried out by the Independent Directors taking into account the views of Executive Directors and Non-Executive Directors.

The Directors expressed their satisfaction with the evaluation process.

Further, the evaluation process confirms that the Board and its Committees continue to operate effectively and the performance of the Directors and the Chair is satisfactory.

NOMINATION & REMUNERATION POLICY

In compliance with the provision of Section 178 of the Companies Act, 2013 and Rules made thereunder, the Board has on the recommendation of the Nomination & Remuneration Committee of the Company, framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management Personnel and their remuneration.

The Nomination and Remuneration Policy as updated from time to time is attached herewith as Annexure -4 and forms an integral part of this Annual Report and the same can also be accessed at the website of the Company at: https://uat-cdn.drlallab.com/2023-06/Nomination-and-Remuneration-Policv.pdf

NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES

The Board met Four (4) times during the Financial Year 2022-23. The details of the meeting of the Board and its Committees thereof are given in the Corporate Governance Report, which forms an integral part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a) in the preparation of the annual accounts for the Financial Year ended March 31, 2023, the applicable accounting standards and Schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at March 31, 2023 and of the profit/loss of the Company for the Financial Year ended March 31,2023;

c) proper and sufficient care has been taken by the Directors for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the annual accounts have been prepared on a ''going concern'' basis by the Directors;

e) proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

AUDITORS AND AUDITORS'' REPORT

I. Statutory Auditors

The Shareholders of the Company in their 28th Annual General Meeting (AGM) held on June 30, 2022, re-appointed M/s. Deloitte Haskins & Sells LLP., Chartered Accountants, (Firm Registration No. 117366W/W10001 8) as the Statutory Auditors of the Company to hold office for their second term of five (5) year(s) i.e. from the conclusion of 28^th AGM till the conclusion of 33^rd AGM of the Company, to be held in calendar year 2027.

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors have confirmed that they have not been disqualified to act as Statutory Auditors of the Company and that their continuation is within the ceiling limit as prescribed under section 141 of the Companies Act, 2013 and/ or other relevant statue.

Further, the Statutory Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) for the time being in force).

The Auditors'' Report for the Financial Year ended March 31,2023, does not contain any qualification, reservation or adverse remark.

The Auditors'' Report being self-explanatory does not call for any further comments from the Board of Directors.

II. Cost Auditors

The Board of Directors on the recommendations of the Audit Committee has appointed M/s A.G. Agarwal & Associates, Cost and Management Accountants, as Cost Auditors of the Company for the Financial Year 2023-24 at a fee of H 1,00,000/- (Rupees One Lakh Only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the Shareholders at the ensuing AGM.

III. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed M/s PDS & Co., Company Secretaries ("Secretarial Auditorsâ) to conduct the Secretarial Audit of the Company for the Financial Year 2022-23.

The Secretarial Audit Report for the Financial Year ended March 31, 2023 is attached herewith as Annexure-5 and forms an integral part of this Annual Report. The Secretarial Audit Report is self explanatory and does not contain any qualification, reservation or adverse remark.

In compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, Secretarial Audit Report of Material Wholly Owned Subsidiary Company viz. Suburban Diagnostics (India) Private Limited is also attached herewith as Annexure-6 and forms an integral part of this Annual Report. The Secretarial Audit Report of Suburban Diagnostics (India) Private Limited is self-explanatory and does not contain any qualification, reservation or adverse remark.

ANNUAL RETURN

The Annual Return of the Company in Form MGT- 7 in accordance with Section 92(3) of the Companies Act, 2013 is available on the website of the Company at https://uat-cdn.drlallab.com/2023-08/MGT-7-Annual-Return-2022-23.pdf

RELATED PARTY TRANSACTIONS

In compliance with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has formulated a Policy on Related Party Transactions which is available on Company''s website at https://uat-cdn.drlallab.com/2023-06/Policy-on-Related-Party-Transactions.pdf

The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and its Related Parties. All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions which are of repetitive nature and / or entered in the Ordinary Course of Business and are at Arm''s Length.

All related party transaction entered during the year were in Ordinary Course of the Business and on Arm''s Length basis. No Material Related Party Transaction

as per the limits specified under Companies Act, 2013 and/ or SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, was entered during the year under review by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

LOANS, GUARANTEES AND INVESTMENTS

In terms of the provisions of section 186 of the Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, details of Investments are set out at Note No. 6 to the Standalone Financial Statements of the Company.

During the year under review, the Company has not given any loan or provided any guarantees pursuant to Section 186 of the Companies Act, 2013.

RISK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed to manage the risks in a proactive and efficient manner. Your Company periodically assesses risk elements in the internal and external environment and incorporates risk treatment plans in its strategy, business and operational plans.

Your Company, through its Risk Management Policy, strives to contain impact and likelihood of the risks within the risk appetite as agreed from time to time with the Board of Directors. The Company has a Risk Management Committee to identify elements of risk in different areas of operations; the details of the Risk Management Committee are included in the Corporate Governance Report.

WHISTLE BLOWER MECHANISM

Your Company has a Whistle Blower Mechanism in place as required under Section 177 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. More details in this regard have been outlined in the Corporate Governance Report annexed to this report and are also available under Investors Section on the Company''s website at: www.lalpathlabs.com

CORPORATE SOCIAL RESPONSIBILITY

the Company, through its CSR initiative, your Company will enhance value creation in the society through its services, conduct and initiatives, so as to promote sustained growth for the society.

The Board of Directors of your Company has formulated and adopted a policy on CSR which can be accessed at: https://uat-cdn.drlallab.com/2023-06/CSR-Policy.pdf

The CSR Policy of your Company outlines the Company''s philosophy for undertaking socially useful programs through the creation of a CSR Trust for welfare and sustainable development of the community at large as part of its duties as a responsible corporate citizen.

The composition of CSR committee, details of Unspent amount transferred to Unspent CSR Account along with reason thereof and the disclosures as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended are provided in the "Annual Report on CSR Activitiesâ attached herewith as Annexure-7 and forms an integral part of this Annual Report.

MANAGEMENT DISCUSSION AND

ANALYSIS REPORT

The Management Discussion and Analysis (''MDA'') Report gives details of the overall industry structure, developments, performance and state of affairs of the Company''s business and other material developments during the Financial Year. The MDA report for the Financial Year 2022-23 is attached herewith as Annexure- 8 and forms an integral part of this Annual Report.

BUSINESS RESPONSIBILITY AND

SUSTAINABILITY REPORT

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility and Sustainability Report (BRSR) for Financial Year 2022-23 is attached herewith as Annexure-9 and forms an integral part of this Annual Report.

CORPORATE GOVERNANCE REPORT

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate report on Corporate Governance for the Financial Year 2022-23 along with a certificate from the Practicing Company Secretary on its compliance, is attached herewith as Annexure-10 and forms an integral part of this Annual Report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has complied with the provisions relating to the constitution of Internal Complaints Committee (ICC) as specified under the POSH Act.

The Company conducts sessions for employees to build awareness amongst employees about the Policy and the provisions of the POSH Act.

Status of Complaints under the POSH Act during the Financial Year 2022-23 is detailed below:

Particulars	No. of Complaints
Compliant pending at beginning of Financial Year	0
Complaint received during Financial Year	7
Compliant resolved during Financial Year	7
Compliant pending at end of Financial Year	0

CONSERVATION OF ENERGY,

TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is set out hereunder:

(A) Conservation of energy

(i) Steps taken or impact on conservation of energy

I. Maintaining power factor (PF) upto .99 (unity). Maintaining upto- 0.9994 at majority of the locations

II. Labs/ PSC locations are equipped with LED Lights for saving energy in past years and all new labs are equipped with LED only.

III. Installed R32 refrigerant operated air conditioning systems across the nation, which helps in conserving Ozone layer.

IV. Automatic phase sequence corrector panel installed in 22 locations to saving the Diesel consumption.

V. Current installed capacity of solar power plants is 100 KW (50 50) in National Reference Lab, Rohini, Delhi and 10KW in Reference Lab, Kolkata.

VI. De-scaling of Chillers is being done semiannual for better efficiency & saving the energy

VII. RO waste water recycling has helped in saving approx. 36KL of water per day in FY 2022-23,

VIII. ETP (Effluent Treatment Plant) installed in all satellite labs for waste water treatment throughout the year across the Nation to treat the liquid waste of labs, to keep environment clean.

IX. Equipped all locations with Advance Autoclave by which Temp, Pressure and time are recorded automatically in graph and data. It''s as per BMW guidelines.

X. 89 E-bikes taken on rent for sample transportation during the FY 2022-23 for home collection and logistics. E-bikes offer a considerable opportunity to cut travel emissions. Switching from a daily car journey to an e-bike can save an average 249g of CO2 for every 1km travelled.

XI. 12 locations were D&I accessible during the FY 2022-23, to make work place workable for everyone''s. moving non-accessibility to accessibility.

XII. Energy Consumption Data:
Parameter	FY 2022-23	FY 2021-22
Parameter	Current Financial Year (MWH)	Previous Financial Year (MWH)
Total electricity consumption (A) (Data calculated [email protected] per unit) (MWH)	16,379	15,271
Total fuel consumption (B) (calculated based on 0 .3 KWH per liter) (MWH)	39	43
Energy consumption through other sources (C) (Solar) (MWH) Total energy consumption (A B C) (MWH)	113	61
	16,531	15,375

(ii) Steps taken by the company for utilising alternate sources of energy

The Company had further added solar energy system of 50 KW at its National Reference Lab in Rohini, New Delhi.

(iii) Capital investment on energy conservation equipmentâs

The Company has spent approx. H 3.2 Million on installation of solar energy system at its National Reference Lab in Rohini, New Delhi.

(B) Technology absorption (i) Imported Technologies
S. No.	Processes/ Technologies	Description	Date of Import	Absorption	Benefits
1.	IBEX	IBEX is an Artificial Intelligence (AI) enabled software tool which is used for the diagnosis of the digital images of histopathology / IHC slides. It uses data models to provide the diagnosis. The vendor is based out of Israel & the tech support is provided to us through European region. Currently the absorption is limited to Prostate cancer & is validated and expected to be rolled out for Breast cancer diagnosis in FY24 qtr2	November, 2021	Fully	AI assisted reporting for Prostate cancer and Breast cancer. The cancer heat map and quantification improve accuracy and standardisation of reporting.
2.	AlloSeq analysis software	For Donor Derived cell free DNA (ddcfDNA) analysis for monitoring solid organ transplants	June, 2021	Fully	We are first in India to launch this test in the market last year. The test offers a noninvasive monitoring for all solid organ transplants -cardiac, liver, lung, kidney as an alternative to repeated biopsy
3.	Leica Pegasus	Leica Pegasus is a tissue processor with barcode based tracking mechanism and alcohol concentration monitor	March 2023	Fully	First Installation of this automated system in India. Barcode based tracking of anatomic tissue processing and monitoring of the alcohol concentration for each container with alerts thus ensuring improved tissue processing results.
4.	Metafer	Automated metaphase capturing microscope used for karyotyping. This system also uses Artificial Intelligence for cytogenetic analysis	December 2022	Fully	High speed scanning of metaphases for automated capture of karyotype for cytogenetic analysis. AI supported analysis of the karyotype supports faster screening and analysis
5.	Optrascan	Whole slide digital scanner with loading capacity of 80 slides in one go.	October 2022	Fully	Telepathology software can help real time remote consultations. Real time auto focus and Z-Stack functions available for cytology smears. Continuous loading and unloading for efficient workflow

(ii) Other locally sourced Technologies:

RE Owned IP: Dr. Lal PathLabs Ltd. (DLPL) has been a pioneer in introducing newer technologies & newer strategies to run the business operations ever efficiently & consistently improved the service deliveries to its customers. One such latest tech initiative in the long list of tech driven solution is the creation of an in-house AI system for suggestive insights to its customers. The same is being called as Reco.AI. The said engine is DLPL''s own IP & is able to suggest / recommends the customers for relevant tests basis various parameters i.e. Current health conditions, Past result trends, demographic details, disease categories etc. The data models imbibed & deployed under Reco.AI have been enriched by processing a huge amount of clinical data.

PLM: DLPL is committed to offer a full scale Patient Lifecycle management (PLM) for its customers. The aim is to have an enhance customer experience by managing the PLM & on-boarding the customers on the transition of mind set of illness to wellness. There are several campaigns & programs created under this PLM where the in depth data analysis & lots of cutting edge technologies like predictive & profiling AI models are being used to help customers in the management of their healthcare. We at DLPL call it Customer health improvement philosophy (''CHIPs'') which aims to simplify patient lives by creating more tech enabled centres of excellence (''COE'') and leveraging digital infrastructure. There has been a majority of influx of technology in the digital infrastructure i.e. Data analytics, Chatbots, AI driven IVRs, One Common registration for POS etc.

Logistics Owned IP: One of the important cog in running the DLPL business wheel is the automation in Logistics operations. The automation is of the most significant essence here as the volume & touch points of sample collection is tremendous & simply not possible to manage through manual / conventional means. The technology has again come to front in developing a home grown Logistics automation system. The System is using latest tech stack to manage the sample collection, Sample handover, Tracking of sample movements, fleet management etc. AI driven data models are used for Route optimizations & the image recognition models are used for tube scanning & bagging process. Geo fencing & Secure QR code based hand over process are also included for bringing in overall efficiency in the system.

Medprime - Cilika digital microscope

Medprime, a startup incubated at NASSCOM, has developed a low cost, light weight, smart & connected Microscope, which can be deployed at

remote locations. Within seconds, the enhanced images of the hematology peripheral smear slide can be sent digitally to the expert who can examine those for Second opinion. Deployed at 18 remote locations, it has reduced turn-around time of second opinion slides. Also, the images of the samples being sent digitally to the expert has enabled them to do the examination from any place, thereby enabling those in any location to take up the examination of sample sent from anywhere, allowing improvement in operational efficiency.

(C) Expenditure incurred on Research and Development: H 36 Million

(D) Foreign exchange earnings and outgo
Particulars	Amount¹ (In J Million)
Foreign Exchange Earnings	220.22
Foreign Exchange Outgo	101.37
(¹) Item representing Profit & Loss A/c for the year

INTERNAL FINANCIAL CONTROLS

Your Company has in place an adequate internal financial control framework with reference to financial and operating controls thereby ensuring orderly and efficient conduct of its business, including adherence to the Company''s policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information.

During Financial Year 2022-23, such controls were tested and no reportable material weakness in the design or operation was observed.

The Directors have in the Directors Responsibility Statement confirmed the same to this effect.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant/material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of your Company and its operations in future.

CHANGE IN NATURE OF BUSINESS

There was no change in the nature of business of the Company during Financial Year 2022-23.

COMPLIANCE OF SECRETARIAL STANDARDS

The Company has duly complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors (SS-1) and Shareholders (SS-2).

GENERAL DISCLOSURE

â¢ During the year under review, there is no application made and/or no proceeding pending under the Insolvency and Bankruptcy Code, 2016. ¹

APPRECIATION

Your Directors wish to convey their gratitude and place on record their appreciation for all the employees at all levels for their hard work, solidarity, cooperation and dedication during the year. Your Directors sincerely convey their appreciation to customers, shareholders, vendors, bankers, business associates, regulatory and government authorities for their continued support.

For and on behalf of Board of Directors

(Hony) Brig. Dr. Arvind Lal Place: Gurugram Executive Chairman

Date: July 27, 2023 DIN: 00576638

During the year under review, requirement of disclosing details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof is not applicable on the Company.

Mar 31, 2022

Your Directors have pleasure in presenting the 28^th Annual Report on the business and operations of your Company along with the audited statement of accounts for the year ended March 31, 2022.

FINANCIAL RESULTS

The Financial performance of your Company for the year ended march 31, 2022 is summarized below:

('' in Million)
particulars	Year ended	Year ended	Year ended	Year ended
	March 31, 2022	March 31, 2021	March 31, 2022	March 31, 2021
	(Consolidated)	(Consolidated)	(Standalone)	(Standalone)
Total Income	21,399.54	16,325.99	19,257.22	15,418.22
Total Expenses	16,649.72	12,381.90	14,663.28	11,677.79
Profit/(Loss) before Tax (PBT)	4,749.82	3,944.09	4,593.94	3,740.43
Profit/(Loss) after Tax (PAT)	3,502.91	2,964.79	3,440.54	2,801.06

Regulationsâ). The consolidated financial statements have been prepared on the basis of audited financial statements of the Company and its Subsidiaries, as approved by their respective Board of Directors.

DIVIDEND

During the Financial Year, your Company paid dividends as under:

Date of Declaration

Dividend

Type

Financial

Year

Dividend per Share (face value of '' 10/- each)

July 29, 2021

Final

Dividend

2020-21

'' 8

July 30, 2021

Interim

Dividend

2021-22

'' 6

FINANCIAL PERFORMANCE

I. CONSOLIDATED PERFORMANCE

During the year under review, the consolidated income of the Company increased to

'' 21,399.54 million compared to '' 16,325.99 million in the previous year, registering growth of 31%. Net profit after tax for the group increased to '' 3,502.91 million from '' 2964.79 million representing a growth of 18%.

II. STANDALONE PERFORMANCE

During the year under review, the standalone income of the Company increased to

'' 19,257.22 million compared to '' 15,418.22 million in the previous year, registering growth of 25 %. the standalone Net profit after tax for the year increased by 23% to '' 3,440.54 million compared to '' 2,801.06 million in the previous year.

CONSOLIDATED ACCOUNTS

the consolidated financial statements of your Company for the Financial Year 2021-22, are prepared in compliance with applicable provisions of the Companies act, 2013 (âthe Actâ), Indian accounting Standards (âInd-ASâ) and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing

In addition, your Directors are pleased to recommend dividend of '' 6/- per equity share of face value of '' 10/-each as Final Dividend for the Financial Year 2021-22, for approval by the shareholders at the ensuing Annual General Meeting (âAGMâ) of the Company.

The Dividend Distribution Policy of the Company is attached herewith as Annexure 1 and forms an integral part of this Annual Report.

The said policy is also available on the website of the Company at: https://www.lalpathlabs.com/pdf/ brochures/Dividend-Distribution-Policy.pdf

TRANSFER TO RESERVES

During the year under review, no amount from the profit of the Company has been transferred to the General Reserve of the Company.

AMALGAMATION

The Board of Directors of your Company in their meeting on February 3, 2020, approved a scheme of Amalgamation ("the schemeâ) between Dr. Lal PathLabs Limited (the Company/Transferee Company) and APL institute of Clinical Laboratory & Research Private Limited, a wholly owned subsidiary of the Company (Transferor Company), having its Registered Office in Ahmedabad, subject to requisite approvals under Section 230 to 232 of the Companies Act, 2013 ("the Actâ).

The New Delhi Bench of Honâble NCLT vide its order dated May 13, 2022 has sanctioned the Scheme. The Company now awaits the approval of the Scheme by Ahmedabad Bench of the Honâble NCLT.

The appointed date for the Scheme is April 1, 2020 and the Scheme shall be effective from the date on which certified copies of the order of New Delhi Bench and the Ahmedabad Bench of the Honâble NCLT, sanctioning the Scheme, are filed with the respective Registrar of Companies.

SHARE CAPITAL

During the Financial Year 2021-22, there was no change in the authorised, subscribed, issued and paid-up share capital of the Company. As on March 31, 2022, the paid-up share capital of the Company stood at '' 83,34,48,770/- divided into 8,33,44,877 equity shares of '' 10/- each.

Further, on May 6, 2022 7,000 equity shares of '' 10/- were allotted under ESOP 2010 Plan of the Company. As a result of which, the paid up share capital of the Company increased from '' 83,34,48,770 divided into 8,33,44,877 equity shares of '' 10/- each to '' 83,35,18,770 divided into 8,33,51,877 equity shares of '' 10/- each.

EMPLOYEES STOCK OPTION PLAN / SCHEME

During the year under review, there has been no material change in the ESOP-2010 and RSU-2016 Scheme(s) of the Company and these Schemes continue to be in compliance with relevant/applicable ESOP Regulations/Guidelines.

Further the details required to be provided under the SEBi (Share Based Employee Benefits and

Sweat Equity) Regulations, 2021 are disclosed on the website of the Company and can be accessed at www.lalpathlabs.com/pdf/Information-as-per-SEBI-(SBEB)-Regulations-FY22.pdf.

SUBSIDIARIES

During the year under review, your Company acquired 100% stake in M/s Suburban Diagnostics (India) Private Limited ("Suburbanâ) consequent upon which Suburban became a Wholly Owned Subsidiary of the Company, with effect from November 12, 2021.

A report on the performance and financial position of each of the subsidiaries for the financial year ended March 31, 2022 in Form AOC -1 as per the Companies Act, 2013 is attached herewith as Annexure-2 and forms an integral part of this Annual Report.

The annual accounts of the subsidiaries shall also be made available to the Members of the Company/ Subsidiary Companies seeking such information at any point of time. The annual accounts of the subsidiaries are available under investors section on the website of the Company at www.lalpathlabs.com.

The Company has formulated a policy for determining material subsidiaries. The said policy is also available on the website of the Company at: https://www.la l pathlabs.com/pdf/Policy-for-determining-Material-Subsidiaries.pdf.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

No material changes and commitments, other than disclosed as part of this report, affecting the financial position of the Company have occurred between March 31, 2022 and the date of the report.

PUBLIC DEPOSITS

During the Financial Year 2021-22, your Company has not accepted any deposit within the meaning of Section 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Particulars of employee remuneration, as required under Section 197 (12) of the Companies Act, 2013 read with Rule 5 (2) and 5(3) of the Companies (appointment and remuneration of Managerial Personnel) rules, 2014 forms part of this annual report. in terms of the provisions of the first proviso to section 136 (1) of the Companies Act, 2013, the annual report is being sent to shareholders, excluding the aforementioned information. any shareholder interested in obtaining a copy of such statement may write to the Company secretary of the Company at [email protected].

AUDIT COMMITTEE

The composition of audit Committee has been detailed in the Corporate Governance report, forming part of this annual report.

An recommendations made by the audit Committee have been accepted by the Board of Directors.

DIRECTORSI. Retirement by rotation and subsequent re-appointment

Dr. Archana Lal Erdmann (DiN: 08432506), Non-Executive Director of the Company is liable to retire by rotation at the ensuing annual General meeting (âAGMâ) pursuant to the provisions of section 152 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) rules, 2014 and being eligible offers herself for reappointment. Appropriate resolution for her re-appointment is being placed for the approval of the shareholders of the Company at the ensuing AGM.

A brief profile of Dr. Archana Lal Erdmann and other related information is detailed in the Notice convening the 28^th AGM of your Company.

the board considered the said re-appointment in the interest of the Company and hence recommends the same to the shareholders for approval.

ii. Declaration of independence from Independent Directors

Your Company has received declarations from all the independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the schedules and rules issued thereunder as well as sEBI (Listing obligations and Disclosure requirements) regulations, 2015.

in the opinion of the board, independent Directors fulfil the conditions specified in Companies Act, 2013 read with the schedules and rules made thereunder as well as in sEBI (Listing obligations and Disclosure requirements) regulations, 2015 and are independent from management.

key managerial personnel

in accordance with the provisions of sections 2(51), 203 of the Companies Act, 2013 read with Companies (Appointment and remuneration of Managerial Personnel) rules, 2014, the following were the Key managerial Personnel of the Company as on march 31, 2022

1. (Hony) Brig. Dr. Arvind Lal - Executive Chairman

2. Dr. Om Prakash Manchanda - managing Director

3. Dr. Vandana Lal - Whole time Director

4. Mr. Bharath U - Chief Executive Officer

5. Mr. Ved Prakash Goel - Group Chief Financial Officer; and

6. Mr. rajat Kalra - Company secretary and Legal Head

ANNUAL EvALUATIoN of BoARD''S

performance

Pursuant to the provisions of the Companies Act, 2013 and sEBi (Listing obligations and Disclosure requirements) regulations, 2015, the Board has carried out annual evaluation of (i) its own performance; (ii) individual Directors Performance; (iii) Chairman of the Board; and (iv) Performance of all Committees of Board for the Financial Year 2021-22.

A structured questionnaire was prepared after taking into consideration the inputs received from Nomination and remuneration Committee, covering various aspects of the Boardâs functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the independent Directors was carried out by the entire Board. The performance evaluation of the Non-independent Directors and Chairman of the Board was carried out by the independent Directors.

The Directors expressed their satisfaction with the evaluation process.

Further, the evaluation process confirms that the Board and its Committees continue to operate effectively and the performance of the Directors and the Chair is satisfactory.

REMUNERATION POLICY

In compliance with the provision of section 178 of the Companies Act, 2013, the board has, on the recommendation of the Nomination & Remuneration Committee of the Company, framed a policy for selection and appointment of Directors, Key Managerial Personnel, senior Management and their remuneration.

The Nomination and remuneration Policy as updated from time to time is attached herewith as Annexure-4 and forms an integral part of this annual report and can also be accessed at the website of the Company at: https://www.lalpathlabs.com/pdf/ brochures/Nomination and remuneration Policy mav.pdf.

NUMBER OF MEETINGS OF THE BOARD AND Its Committees

The Board met Seven (7) times during the Financial Year 2021-22. The details of the meetings of the Board and Committees thereof are given in the Corporate Governance Report, which forms an integral part of this Annual Report.

directors'' responsibility statement

Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a) in the preparation of the annual accounts for the Financial Year ended March 31, 2022, the applicable accounting standards and schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at March 31, 2022 and of the profit/loss of the Company for the Financial Year ended March 31, 2022;

c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the annual accounts have been prepared on a âgoing concernâ basis;

e) proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

AUDITORS AND AUDITORS'' REpORTI. Statutory Auditors

The Shareholders in the 23rd Annual General Meeting (âAGMâ), approved the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W - 100018), as the Statutory Auditors, for a period of five (5) years i.e. from the conclusion of the 23rd AGM held on July 20, 2017 till the conclusion of 28th AGM of the Company to be held in the calendar year 2022.

The Board of Directors in their meeting on May 17, 2022 on the recommendation of the Audit Committee, re-appointed M/s. Deloitte Haskins & Sells LLP., Chartered Accountants, (Firm Registration No. 117366W/W100018) as the Statutory Auditors of the Company to hold office for their second term of five (5) year i.e. from the conclusion of 28th AGM till the conclusion of 33rd AGM of the Company, to be held in calendar year 2027, subject to the approval of Shareholders in ensuing Annual General Meeting.

M/s. Deloitte Haskins & Sells LLP, have further, confirmed that the said re-appointment, if made, will be in accordance with the provisions as prescribed under Sections 139 and 141 of Companies Act, 2013.

M/s. Deloitte Haskins & Sells LLP have also confirmed that they have subjected themselves to the peer review process of the Institute of Chartered Accountants of India (ICAI) and hold a valid certificate issued by the Peer Review Board of the ICAI.

The Auditorsâ Report for the Financial Year ended March 31, 2022, does not contain any qualification, reservation or adverse remark.

Further, the auditorsâ report being selfexplanatory does not call for any further comments from the Board of Directors.

ii. Maintenance of Cost Records and Cost Auditors

in terms of the Section 148 of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost accounting records and get them audited every year. Accordingly, such accounts and records were made and maintained for the financial year 2021-22.

The Board of Directors on the basis of recommendations from Audit Committee has appointed M/s A.G. Agarwal & Associates, Cost and Management Accountants, as Cost Auditors of the Company for the Financial Year 2022-23 at a fee of '' 75,000/- (Rupees Seventy Five Thousand only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the shareholders at the ensuing AGM.

iii. Secretarial Auditors

The Secretarial Audit Report for the Financial Year ended March 31, 2022 is attached herewith as Annexure-5 and forms an integral part of this Annual Report. The Secretarial Audit Report is self explanatory and does not contain any qualification, reservation or adverse remark.

in compliance with the requirements of SEBi (Listing Obligations and Disclosure Requirements), Regulations, 2015, Secretarial Audit Report of Material Wholly Owned Subsidiary Company viz Suburban Diagnostics (india) Private Limited is also attached herewith as Annexure-6 and forms an integral part of this Annual Report. The Secretarial Audit Report of Suburban Diagnostics (india) Private Limited is self explanatory and does not contain any qualification, reservation or adverse remark.

annual return

The Annual Return of the Company in Form MGT- 7 in accordance with Section 92(3) of the Companies Act, 2013 is available on the website of the Company at www.lalpathlabs.com/pdf/MGT-7-Annual-Return-2021-22.pdf.

related party transactions

in compliance with the requirements of the Companies Act, 2013 and SEBi (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has formulated a Policy on Related Party Transactions which is also available on Companyâs website at https://www.lalpathlabs.com/pdf/Policy-on-Related-Partv-Transactions.pdf.

All related party transaction entered during the year were in Ordinary Course of the Business and on Armâs Length basis. No Material Related Party Transaction,

i.e. transaction exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, was entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3) (h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

loans and investments

in terms oft he provisions ofsection186 oft he Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014 and Schedule V of the SEBi (Listing Obligations and Disclosure Requirements) Regulations, 2015, details of investments are set out in Note No. 6 and details of Loans are set out in Note Nos. 21 & 22 to the Standalone Financial Statements of the Company.

risk management

plans in its strategy, business and operational plans. As on the date of this report, the Company does not foresee any critical risk, which threatens its existence.

Your Company, through its Risk Management Policy, strives to contain impact and likelihood of the risks within the risk appetite as agreed from time to time with the Board of Directors. The Company has a risk management Committee to identify elements of risk in different areas of operations; the details of the risk management Committee are included in the Corporate Governance report.

WHISTLE BLOWER MECHANISM

Your Company has a Whistle blower mechanism in place as required under section 177 of the Companies Act, 2013 and the SEBi (Listing Obligations and Disclosure Requirements) Regulation, 2015. More details in this regard have been outlined in the Corporate Governance Report annexed to this report and are also available under investors Section on the Companyâs website at: www.lalpathlabs.com.

CORPORATE SOCIAL RESPONSIBILITY

For your Company, Corporate Social Responsibility (CSR) means the integration of social, environmental and economic concerns in its business operations. CSR involves operating Companyâs business in a manner that meets or exceeds the ethical, legal, commercial and public expectations. in alignment with vision of the Company, through its CSR initiative, your Company will enhance value creation in the society through its services, conduct and initiatives, so as to promote sustained growth for the society.

The Board of Directors of your Company has further formulated and adopted a policy on CSR which can be accessed at: https://www.lalpathlabs.com/pdf/ brochures/CSR-Policv.pdf.

The CSR Policy of your Company outlines the Companyâs philosophy for undertaking socially useful programs through the creation of a CSR Trust for welfare and sustainable development of the community at large as part of its duties as a responsible corporate citizen.

The composition of CSR committee and disclosure as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, is attached herewith as Annexure-7 and forms an integral part of this Annual Report.

MANAGEMENT DISCUSSION AND

analysis report

The Management Discussion and Analysis (âMDAâ) Report gives details of the overall industry structure, developments, performance and state of affairs of the Companyâs business and other material developments during the Financial Year. The MDA report is attached herewith as Annexure-8 and forms an integral part of this Annual Report.

BUSINESS RESpONSIBILITY AND

sustainability report

SEBi vide its notification dated May 5, 2021 mandated top 1000 listed companies (by market capitalization) to submit a new report on ESG parameters namely Business Responsibility and Sustainability Report (âBRSRâ). The report submission is optional for Financial Year 2021-22 and mandatory from Financial Year 2022-23 onwards.

Your Company has, on a voluntary basis, opted for the BRSR Report for Financial Year 2021-22, which is attached herewith as Annexure-9 and forms an integral part of this Annual Report.

corporate governance report

in compliance with the provisions of SEBi (Listing Obligations and Disclosure Requirements)

Regulations, 2015, a separate report on Corporate Governance along with a certificate from the Practicing Company Secretary on its compliance, is attached herewith as Annexure-10 and forms an integral part of this Annual Report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF wOMEN AT wORKpLACE (prevention, prohibition ANDREDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in compliance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has complied with the provisions relating to the constitution of internal Complaints Committee (iCC) as specified under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company conducts sessions for employees to build awareness amongst employees about the

Policy and the provisions of Prevention of Sexual Harassment of Women at Workplace Act.

Status of Complaints under the sexual harassment of women at Workplace (prevention, prohibition and redressal) act, 2013 during the Financial Year 2021-22 is detailed below:

particulars	No. of Complaints
Compliant pending at beginning of Financial Year	3*
Complaint received during Financial Year	1
Compliant resolved during Financial Year	4
Compliant pending at end of Financial Year	0

*Due to inadvertence, the number of cases resolved was mentioned as five (5) instead of four (4) in the last year Director''s Report. Accordingly, the number of pending cases at the end of the Financial Year 2020-21 was three (3) instead of two (2).

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under section 134 of the Companies Act 2013 read with the Companies (accounts) Rules, 2014, is set out hereunder:

(A) Conservation of energy

(i) Steps taken or impact on conservation of energy

i. Maintaining power factor (PF) upto .99 (unity). maintaining upto- 0.9994 at majority of the locations

ii. LED lights installed for energy saving at 10 locations throughout the year, and all new labs are equipped with Led only.

iii. installed R32 refrigerant operated air conditioning systems which helps in conserving ozone layer

iV. automatic phase sequence corrector panel installed in 12 locations to save the Diesel consumption

V. Current installed capacity of solar power plants is 50KW in National reference Lab Rohini, Delhi and 10KW in reference Lab, Kolkata.

Vi. De-scaling of Chillers is being done semi-annual for better efficiency & save the energy

Vii. Ro waste water recycling has helped in saving approx. 13KL of water per day.

Viii. ETP (Effluent treatment Plant) installed in 82 satellite labs for waste water treatment throughout the year across the Nation to treat the liquid waste of labs, to keep environment clean.

iX. Equipped 59 location from advance autoclave which having temp, Pressure and time are recorded automatically in graph and data. itâs as per BMW guidelines.

(ii) Steps taken by the company for utilising alternate sources of energy

The Company has already installed solar power plants at its two biggest Reference Laboratories i.e National Reference Lab in Rohini and Reference Lab in Kolkata. The Company, further, plans to add solar panels to its Satellite Hub Labs as well in the coming years.

(iii) Capital investment on energy conservation equipment''s

The Company spent approx. '' 3.2 Million for addition of new Solar Panels at its Reference Laboratories.

(D) Foreign exchange earnings and outgo

particulars	Amount (In '' Million)
Foreign Exchange Earnings	187.93
Foreign Exchange Outgo	98.30

internal financial controls

Your Company has in place an adequate internal financial control framework with reference to financial and operating controls thereby ensuring orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information.

During Financial Year 2021-22, such controls were tested and no reportable material weakness in the design or operation was observed.

The Directors have in the Directors Responsibility Statement confirmed the same to this effect.

disclosure related to insolvency and bankruptcy

During the financial year under review, there is no application made and/or no proceeding pending under the Insolvency and Bankruptcy Code, 2016.

significant/material orders passed by the regulators

There are no significant/material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of your Company and its operations in future.

compliance of secretarial standards

The Company has duly complied with secretarial standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors (SS-1) and Shareholders (SS-2).

appreciation

For and on behalf of Board of Directors

(Hony) Brig. Dr. Arvind Lal Place: Gurugram Executive Chairman

Date: May 17, 2022 DIN: 00576638

Mar 31, 2021

Dear Members,

Your Directors have pleasure in presenting the 27^th Annual Report on the business and operations of your Company along with the audited statement of accounts for the year ended March 31, 2021.

FINANCIAL RESULTS

The Financial performance of your Company for the year ended March 31, 2021 is summarized below:

(in '' million)
Particulars	Year ended March 31, 2021 (Consolidated)	Year ended March 31, 2020 (Consolidated)	Year ended March 31, 2021 (Standalone)	Year ended March 31, 2020 (Standalone)
Total Income	16,325.99	13,854.02	15,418.22	13,312.07
Total Expenses	12,381.90	10,748.99	11,677.79	10,284.56
Profit/(Loss) before Tax (PBT)	3,944.09	3,105.03	3,740.43	3,027.51
Profit/(Loss) after Tax (PAT)	2,964.79	2,275.87	2,801.06	2,231.80

FINANCIAL PERFORMANCE

I. CONSOLIDATED PERFORMANCE

During the year under review, the consolidated income of the Company increased to '' 16,325.99 million compared to '' 13,854.02 million in the previous year, registering growth of 18%. Net profit after tax for the group increased to '' 2,964.79 million from '' 2,275.87 million representing a growth of 30%.

II. STANDALONE PERFORMANCE

During the year under review, the standalone income of the Company increased to '' 15,418.22 million compared to '' 13,312.07 million in the previous year, registering growth of 16%. The standalone profit after tax for the year increased by 26% to '' 2,801.06 million compared to '' 2,231.80 million in the previous year.

CONSOLIDATED ACCOUNTS

The consolidated financial statements of your Company for the Financial Year 2020-21, are prepared in compliance with applicable provisions of the Companies Act, 2013 (''the Actâ), Indian Accounting Standards and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ). The consolidated financial statements have been prepared on the basis of audited financial statements of the Company and its Subsidiaries, as approved by their respective Board of Directors.

DIVIDEND

During the Financial Year, your Company declared and paid dividends as under:

Date of Declaration	Dividend Type	Dividend Per Share (face value of '' 10/- each)
November 6, 2020	1^st Interim Dividend	'' 6
January 29, 2021	2^nd Interim Dividend	'' 6

In addition, your Directors are pleased to recommend dividend of '' 8/- per equity share of face value of '' 10/- each as Final Dividend for the Financial Year 2020-21, for approval of the shareholders at the ensuing Annual General Meeting (âAGMâ) of the Company.

If approved by the shareholders, the total dividend for the Financial Year shall be '' 20/- per equity share of face value of '' 10/- each.

The Dividend Distribution Policy of the Company is attached herewith as Annexure 1 and forms an integral part of this Annual Report.

The said policy is also available at the website of the Company at: https://www.lalpathlabs.com/pdf/brochures/Dividend-Distribution-Policy.pdf.

TRANSFER TO RESERVES

During the year under review, no amount from the profit of the Company has been transferred to the General Reserve of the Company.

AMALGAMATION

The Board of Directors of your Company in their meeting on February 3, 2020, approved a Scheme of Amalgamation (''the Schemeâ) between Dr. Lal PathLabs Limited (the Company/ Transferee Company) and APL Institute of Clinical Laboratory & Research Private Limited, a wholly owned subsidiary of the Company (Transferor Company), having its Registered Office in Ahmedabad, subject to requisite approvals under Section 230 to 232 of the Companies Act, 2013.

The Hon''ble New Delhi Bench of National Company Law Tribunal (''Hon''ble Tribunal'' or ''NCLT'') vide its order dated January 29, 2021 dispensed convening meeting of Equity Shareholders and Unsecured Creditors of the Company.

Transferor Company is in the process of filing the Second Motion Petition with NCLT.

The appointed date for the Scheme, if approved, shall be April 01, 2020 and the Scheme shall be effective from the date on which certified copies of the order of National Company Law Tribunal, Principal bench, New Delhi and National Company Law Tribunal, Ahmedabad, sanctioning the Scheme, is filed with the respective Registrar of Companies.

SHARE CAPITAL

During the Financial Year 2020-21, there was no change in the authorised, subscribed, issued and paid-up equity share capital of the Company. As on March 31, 2021, the paid-up share capital of the Company stood at '' 83,34,48,770/- divided into 8,33,44,877 equity shares of '' 10/- each.

EMPLOYEES STOCK OPTiON PLAN / SCHEME

Further the details required to be provided under the SEBI (Share Based Employee Benefits) Regulations, 2014 are disclosed on the website of the Company and can be accessed at https:// www.lalpathlabs.com/pdf/Disc-under-reg-14-2021-Website.pdf.

SUBSiDiARiES

A report on the performance and financial position of each of the subsidiaries for the financial year ended March 31, 2021 in prescribed from AOC -1 as per the Companies Act, 2013 is set out in Annexure 2 and forms an integral part of this Annual Report.

The Company has formulated a policy for determining material subsidiaries. The said policy is also available on the website of the Company at: https://www.lalpathlabs.com/pdf/Policy-for-determining-Material-Subsidiaries.pdf.

During the year under review:

â¢ Company''s Wholly Owned Subsidiary viz M/s PathLabs Unifiers Private Limited acquired 70% equity stake in M/s Chanre Laboratory Private Limited (Chanre) consequent upon which Chanre became step down subsidiary of the Company.

â¢ Dr. Lal PathLabs International B.V, a Company incorporated in Netherlands, subsidiary of the Company was wound up.

MATERiAL cHANGES And COMMITMENTS AFFECTING The FiNANCiAL POSmON

No material changes and commitments, other than disclosed as part of this report, affecting the financial position of the Company have occurred between March 31, 2021 and the date of the report.

public deposits

During the Financial Year 2020-21, your Company has not accepted any deposit within the meaning of Section 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.

particulars of employees and related disclosures

interested in obtaining a copy thereof may write to the Company Secretary of the Company at [email protected].

audit committee

The composition of Audit Committee has been detailed in the Corporate Governance Report, forming part of this Annual Report.

All recommendations made by the Audit Committee have been accepted by the Board of Directors.

directors

i. Retirement by rotation and subsequent re-appointment

Dr. Vandana Lal (DIN: 00472955), Whole-time Director of the Company is liable to retire by rotation at the ensuing Annual General Meeting (âAGMâ) pursuant to the provisions of Section 152 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and being eligible offers herself for reappointment. Appropriate resolution for her re-appointment is being placed for the approval of the shareholders of the Company at the ensuing AGM.

A brief profile of Dr. Vandana Lal and other related information is detailed in the Notice convening the 27^th AGM of your Company.

The Board considered said re-appointment in the interest of the Company and hence recommended the same to the shareholders for approval.

ii. Declaration of independence from independent Directors

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules issued thereunder as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In the opinion of the Board, Independent Directors fulfil the conditions specified in Companies Act, 2013 read with the Schedules and Rules issued thereunder as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and are independent from Management.

key managerial personnel

In accordance with the provisions of Sections 2(51), 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the following were the Key Managerial Personnel of the Company as on March 31, 2021

1. (Hony) Brig. Dr. Arvind Lal - Executive Chairman

2. Dr. Om Prakash Manchanda - Managing Director

3. Dr. Vandana Lal - Whole time Director

4. Mr. Bharath U - Chief Executive Officer

5. Mr. Ved Prakash Goel - Chief Financial Officer; and

6. Mr. Rajat Kalra - Company Secretary and Legal Head

annual evaluation OF BOARD''S PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out annual evaluation of (i) its own

performance; (ii) Individual Directors Performance; (iii) Chairman of the Board; and (iv) Performance of all Committees of Board for the Financial Year 2020-21.

A structured questionnaire was prepared after taking into consideration the inputs received from Nomination and

Remuneration Committee, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Non -Independent Directors and Chairman of the Board was carried out by the Independent Directors.

The Directors expressed their satisfaction with the evaluation process.

Further, the evaluation process confirms that the Board and its Committees continue to operate effectively and the performance of the Directors is satisfactory.

REMUNERATION POLiCY

In compliance with the provision of Section 178 of the Companies Act, 2013, the Board has, on the recommendation of the Nomination & Remuneration Committee of the Company, framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management and their remuneration.

The Nomination and Remuneration Policy is set out as Annexure 4 and forms an integral part of this Annual Report and can also be accessed at the website of the Company at the following web link: https://www.lalpathlabs.com/pdf/brochures/Nomination and Remuneration Policy may.pdf.

NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES

The Board met 5 (Five) times during the Financial Year 2020-21. The details of the meetings of the Board are given in the Corporate Governance Report, which forms an integral part of this Annual Report.

directors'' responsibility statement

Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a) in the preparation of the annual accounts for the Financial Year ended March 31, 2021, the applicable accounting standards and Schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at March 31, 2021 and of the profit/loss of the Company for the Financial Year ended March 31, 2021;

c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the

Company and for preventing and detecting fraud and other irregularities;

d) the annual accounts have been prepared on a ''going concern'' basis;

e) proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

auditors AND auditors'' REPORT

I. statutory Auditors

The shareholders in the 23^rd AGM, approved the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W - 100018), as the Statutory Auditors, for a period of five (5) years i.e. from the conclusion of the 23^rd AGM held on July 20, 2017 till the conclusion of 28^thAGM of the Company.

The Statutory Auditors M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, have confirmed that they have not been disqualified to act as Statutory Auditors of the Company and that their continuation is within the ceiling limit as prescribed under Section 141 of Companies Act, 2013 / relevant statute.

The Statutory Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) for the time being in force).

The Auditors'' Report for the Financial Year ended March 31, 2021, does not contain any qualification, reservation or adverse remark.

Further, the Auditors'' Report being self-explanatory does not call for any further comments from the Board of Directors.

II. Maintenance of Cost Records and Cost Auditors

The Board of Directors on the basis of recommendations from Audit Committee has appointed M/s A.G. Agarwal & Associates, Cost and Management Accountants, as Cost Auditors of the Company for the Financial Year 2021-22 at a fee of '' 70,000/-(Rupees Seventy Thousand only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the shareholders at the ensuing AGM.

III. secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed M/s PDS & Co., Company Secretaries (âSecretarial Auditorsâ) to conduct the Secretarial Audit of your Company for the Financial Year 2020-21.

The Secretarial Audit Report for the Financial Year ended March 31, 2021 is annexed herewith as Annexure 5 and forms an integral part of this Annual Report. The Secretarial Audit Report is self explanatory and does not contain any qualification, reservation or adverse remark.

ANNUAL RETURN

The Annual Return of the Company in Form MGT- 7 in accordance with Section 92(3) of the Companies Act, 2013 is available on the website of the Company at https://www.lalpathlabs.com/investor/ shareholder-information.aspx.

RELATED PARTY TRANSACTiONS

In compliance with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has formulated a Policy on Related Party Transactions which is also available on Company''s website at https:// www.lalpathlabs.com/pdf/Policv-on-Related-Partv-Transactions.pdf.

The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties. All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions which are of repetitive nature and / or entered in the Ordinary Course of Business and are at Arm''s Length.

All related party transaction entered during the year were in Ordinary Course of the Business and on Arm''s Length basis. No Material Related Party Transaction, i.e. transaction exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, was entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

LOANS AND iNVESTMENTS

Details of Loans, Guarantees given and Investments made by the Company during Financial Year 2020-21 within the meaning of Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 and Schedule V of the SEBI Listing Regulation, are set out in Note 49 to the Standalone Financial Statements of the Company.

RiSK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner. Your Company periodically assesses risk elements in the internal and external environment, along with the cost of treating such risk elements and incorporates risk treatment plans in its strategy, business and operational plans. As on the date of this report, the Company does not foresee any critical risk, which threatens its existence.

ViGiL MECHANiSM

Your Company has a Vigil Mechanism in place as required under Section 177 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. More details in this regard have been outlined in the Corporate Governance Report annexed to this report and are also available under Investor Section on the Company''s website www.lalpathlabs.com.

corporate SociAL RESPoNSiBiLiTY

For your Company, Corporate Social Responsibility (CSR) means the integration of social, environmental and economic concerns in its business operations. CSR involves operating Company''s business in a manner that meets or exceeds the ethical, legal, commercial and public expectations. In alignment with vision of the Company, through its CSR initiative, your Company will enhance value creation in the society through its services, conduct and initiatives, so as to promote sustained growth for the society.

The Board of Directors of your Company has further formulated and adopted a policy on Corporate Social Responsibility which can be accessed at: https://www.lalpathlabs.com/pdf/brochures/CSR-Policy.pdf.

The composition of CSR committee and disclosure as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, is annexed as Annexure 6 and forms an integral part of this Annual Report.

management DiSCuSSiON AND ANALYSiS REPORT

The Management Discussion and Analysis Report (''MDA'') gives details of the overall industry structure, developments, performance and state of affairs of the Company''s business and other material developments during the Financial Year. MDA is set out as Annexure 7 and forms an integral part of this Annual Report.

business responsibility report

The Business Responsibility Report (''BRR'') provides a detailed overview of initiatives taken by your Company from environmental, social and governance perspectives. BRR is set out as Annexure 8 and forms an integral part of this Annual Report.

CORPORATE GOVERNANCE REPORT

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate report on Corporate Governance along with a certificate from the Practicing Company Secretary on its compliance, is set out as Annexure 9 and forms an integral part of this Annual Report.

disclosure under the sexual harassment of women at workplace (prevention, prohibition AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in compliance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has complied with the provisions relating to the constitution of Internal Complaints Committee (ICC) as specified under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company conducts sessions for employees to build awareness amongst employees about the Policy and the provisions of Prevention of Sexual Harassment of Women at Workplace Act.

Status of Complaints under the sexual harassment of women at Workplace (prevention, prohibition and redressal) Act, 2013 during the Financial Year 2020-21 as detailed below:

particulars

No. of

Complaints

Compliant pending at beginning of Financial Year Complaint received during Financial Year Compliant resolved during Financial Year Compliant pending at end of Financial Year

Compliant pending at end or Financial reai^^^B 2

'' Investigation was underway for remaining 2 (two) complaints as on March 31,2021

CONSERVATiON OF ENERGY, TECHNOLOGY ABSORPTiON AND FOREiGN EXCHANGE EARNiNGS AND OUTGO

i. conservation of Energy and technology Absorption

i. Maintaining power factor (PF) upto .99 (unity). Maintaining upto- 0.9994 at majority of the locations

ii. Major overhauling (D-check) of 750X2 DG set for better performance & reduce the carbon emission

iii. LED lights installed for energy saving at 14 locations throughout the year

iv. 868 Water saving reducer are in place at 194 locations across the country in our lab and office locations

v. ETP - Effluent Treatment Plant installed at 50 labs across the Nation to treat the liquid waste of labs, to keep environment clean

vi. Load reduction done for 2 locations to save the energy

vii. Installed R32 refrigerant operated air conditioning systems which helps in conserving Ozone layer

viii. Automatic phase sequence corrector panel installed in 14 locations to save the Diesel consumption

ix. Current installed capacity of solar power plants are 50KW & 10KW in National reference lab Rohini, Delhi and 50KW in Reference lab, Kolkata.

x. De-scaling of Chillers are being done semi-annual for better efficiency & save the energy

xi. RO waste water recycling has helped in saving approx. 10KL of water per day

ii. Foreign exchange earnings and outgo

particulars	Amount
	(in '' Million)
Foreign Exchange Earnings	143.11
Foreign Exchange Outgo	105.26

internal FiNANciAL cONTROLs

During Financial Year 2020-21, such controls were tested and no reportable material weakness in the design or operation was observed.

The Directors have in the Directors Responsibility Statement confirmed the same to this effect.

disclosure related to insolvency and bankruptcy

During the financial year under review, there is no application made and/or no proceeding pending under the Insolvency and Bankruptcy Code, 2016.

significant/material orders passed by the regulators

There are no significant/material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of your Company and its operations in future.

compliance of secretarial standards

The Company has duly complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors (SS-1) and Shareholders (SS-2).

appreciation

For and on behalf of Board of Directors

(Hony) Brig. Dr. Arvind Lal

Place: New Delhi Executive Chairman

Date: May 21, 2021 DIN: 00576638

Mar 31, 2019

Dear Members,

The Directors have pleasure in presenting the 25^th Annual Report on the business and operations of your Company along with the audited statement of accounts for the year ended March 31, 2019.

FINANCIAL RESULTS

The Financial performance of your Company for the year ended March 31, 2019 is summarized below:

Particulars	Year ended March 31, 2019 (in Rs. million)	Year ended March 31, 2018 (in Rs. million)	Year ended March 31, 2019 (in Rs. million)	Year ended March 31, 2018 (in Rs. million)
	Consolidated	Consolidated	Standalone	Standalone
Total Income	12,493.67	10,881.38	12,113.93	10,555.56
Total Expenses	9,488.19	8,268.23	9,190.26	7,997.98
Profit/(Loss) before Tax (PBT)	3,005.48	2,613.15	2,923.67	2557.58
Profit/(Loss) after Tax (PAT)	2,004.67	1,717.52	1,954.38	1682.70

FINANCIAL PERFORMANCE

During the year under review, the consolidated income of the Company increased to Rs. 12,493.67 million compared to Rs. 10,881.38 million in the previous year, registering growth of 14.8%. Net profit after tax for the group increased to Rs. 2,004.67 Million from Rs. 1,717.85 million representing a growth of 16.7%.

During the year under review, the standalone income of the Company increased to Rs. 12,113.93 million compared to Rs. 10,555.56 million in the previous year, registering growth of 14.8%. The standalone profit after tax for the year increased by 16.2% to Rs. 1,954.38 million compared to Rs. 1682.70 million in the previous year.

CONSOLIDATED ACCOUNTS

The consolidated financial statements of your Company for the Financial Year 2018-19, are prepared in compliance with applicable provisions of the Companies Act, 2013 (âthe Actâ), Accounting Standards and Listing Regulations as prescribed by the Securities and Exchange Board of India (SEBI). The consolidated financial statements have been prepared on the basis of audited financial statements of the Company and its Subsidiary Companies, as approved by their respective Board of Directors.

DIVIDEND

During the Financial Year, your Company declared and paid an interim dividend of Rs. 2.50/- per equity share of face value of Rs. 10/- each. In addition, your Directors are pleased to recommend a dividend of Rs. 3.50/- per equity share of face value of Rs. 10/- each as final dividend for the Financial Year 2018-19, for approval of the shareholders at the ensuing Annual General Meeting (âAGMâ) of the Company.

If approved by the members, the total dividend for the Financial Year shall be Rs. 6/- per equity share of face value of Rs. 10/- each.

The Dividend Distribution Policy of the Company is attached herewith as Annexure 1 and forms an integral part of the Annual Report.

The said policy is also available at the website of the Company at: https://www.lalpathlabs.com/pdf/brochures/Dividend Distribution Policy may.pdf

TRANSFER TO RESERVES

During the year under review, no amount has been transferred to the General Reserve of the Company.

AMALGAMATION OF DELTA RIA AND PATHOLOGY PRIVATE LIMITED

The Board of Directors of your Company in their meeting held on May 12, 2017, approved a Scheme of Amalgamation of Delta Ria And Pathology Private Limited, a wholly owned subsidiary of the Company with the Company, subject to requisite approvals under Section 230 to 232 of the Companies Act, 2013.

The Scheme was sanctioned by the New Delhi and Ahmedabad Bench of Honâble National Company Law Tribunal (NCLT), on October 23, 2018 and December 11, 2018 respectively.

The NCLT orders were filed with the Registrar of Companies, NCT of Delhi & Haryana on January 01, 2019. (Being the effective date).

Pursuant thereto, in accordance with the terms of the scheme, Delta Ria And Pathology Private Limited was amalgamated with Dr. Lal PathLabs Limited w.e.f. April 1, 2017 (being the appointed date) and consequently stands dissolved without winding up.

The necessary accounting entries giving effect to the Scheme were passed in the books of accounts of the Company.

CHANGES IN SHARE CAPITAL

Paid-up Share Capital

During the Financial Year 2018-19, the paid-up equity share capital of the Company has been increased from Rs. 83,33,27,440/to Rs. 83,34,16,100/- pursuant to allotment of 8,866 Equity Shares of Rs. 10/- each under the Employee Stock Option Plan 2010 of the Company.

Authorized Share Capital

During the Financial Year 2018-19, the Authorized Share Capital got increased from Rs. 1,07,90,00,000/- to Rs. 1,07,95,00,000/- by virtue of the NCLT order passed sanctioning the Scheme of Amalgamation of Delta Ria & Pathology Private Limited with the Company.

EMPLOYEES STOCK OPTION PLAN / SCHEME

During the year under review, there has been no material change in the ESOP-2010/ RSU-2016 Scheme(s) of the Company and these Schemes continue to be in compliance with relevant/applicable ESOP Regulations/clauses.

Further the details required to be provided under the SEBI (Share Based Employee Benefits) Regulations, 2014 are disclosed on the website of the Company and can be accessed at https://www.lalpathlabs.com/pdf/Information-as-per-SEBI-(SBEB)-Regulations-FY-19.pdf

SUBSIDIARIES

A report on the performance and financial position of each of the subsidiaries for the financial year ended March 31, 2019 as per the Companies Act, 2013 is set out in Annexure 2 and forms an integral part of this Annual Report.

The annual accounts of the subsidiaries shall also be made available to the Members of the Company/Subsidiary Companies seeking such information at any point of time. The annual accounts of the subsidiaries are also available for inspection for any Member during business hours at the Registered Office of the Company and Subsidiary Companies and have also been uploaded on the website of the Company (www.lalpathlabs.com).

The Company has formulated a policy for determining material subsidiaries. The said policy is also available on the website of the Company at https://www.lalpathlabs.com/pdf/Policy-for-determining-Material-Subsidiaries.pdf.

During the year under review, Dr. Lal Ventures Private Limited and PathLabs Unifiers Private Limited were incorporated on December 10 and December 12, 2018, respectively, as wholly owned subsidiaries of the Company.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report forms an integral part of this Annual Report and gives details of the overall industry structure, developments, performance and state of affairs of the Companyâs business and other material developments during the Financial Year.

BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report (âBRRâ) forms an integral part of this Annual Report. The BRR provides a detailed overview of initiatives taken by your Company from environmental, social and governance perspectives.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

Material changes and commitments, other than disclosed as part of this report, affecting the financial position of the Company are set out in Note 49 and Note 44 to the Standalone and Console Financial Statements respectively.

PUBLIC DEPOSITS

During the Financial Year 2018-19, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.

CORPORATE GOVERNANCE REPORT

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate report on corporate governance along with a certificate from the Practicing Company Secretary on its compliance, forms an integral part of this Annual Report.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

The statement containing particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the Report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company during the business hours till the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy thereof may write to the Company Secretary of the Company.

AUDIT COMMITTEE

The composition of Audit Committee has been detailed in the Corporate Governance Report, forming part of this Annual Report.

All recommendations made by the Audit Committee have been accepted by the Board of Directors.

DIRECTORS

I. Retirement by rotation and subsequent re-appointment:

Mr. Rahul Sharma (DIN: 00956625), Non-Executive Director of the Company is liable to retire by rotation at the ensuing AGM pursuant to the provisions of Section 152 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and being eligible offers himself for reappointment. Appropriate resolution for his re-appointment is being placed for the approval of the shareholders of the Company at the ensuing AGM. A Brief profile of Mr. Rahul Sharma and other related information has been detailed in the Notice convening the 25^th AGM of your Company.

II. Appointment(s)

(1) Ms. Somya Satsangi (DIN: 07275574) was appointed as an Additional Director (Independent) for a period of 3 Years w.e.f February 8, 2019.

(2) Dr. Archana Lal Erdmann (DIN: 08432506) was appointed as an Additional Director (Non-Executive), liable to retire by rotation w.e.f. May 17, 2019.

According to the provisions of Section 161 of the Companies Act, 2013 additional directors shall hold office upto the date of the ensuing Annual General Meeting.

The Board considers their appointment in the interest of the Company and hence recommended the same to the shareholders for approval.

Brief resume/details regarding Director proposed to be reappointed as above are furnished in the Notice of the AGM.

III. Resignation:

Mr. Arun Duggal, resigned as an Independent Director with effect from March 1, 2019.

The Board places on record its appreciation for the services rendered by him during his association with the Company.

Declaration of Independence from Independent Directors

Your Company has received declarations from all the Independent Directors (Including Ms. Somya Satsangi) confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules issued thereunder as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In the opinion of the Board, Independent Directors fulfill the conditions specified in Companies Act, 2013 read with the Schedules and Rules issued thereunder as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and are independent from Management.

KEY MANAGERIAL PERSONNEL

During the year under review Mr. Dilip Bidani resigned as the Chief Financial Officer of the Company and in his position Mr. Ved Prakash Goel was appointed as the Chief Financial Officer w.e.f August 10, 2018.

In accordance with the provisions of Sections 2(51), 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the following are the Key Managerial Personnel of the Company as on March 31, 2019

1. (Hony) Brig. Dr. Arvind Lal - Chairman and Managing Director

2. Dr. Om Prakash Manchanda - CEO and Whole Time Director

3. Dr. Vandana Lal - Whole Time Director

4. Mr. Ved Prakash Goel - Chief Financial Officer; and

5. Mr. Rajat Kalra - Company Secretary and Legal Head

ANNUAL EVALUATION OF BOARDâS PERFORMANCE:

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out annual evaluation of (i) its own performance; (ii) Individual Directors Performance; and (iii) Performance of all committees of Board for the Financial Year 2018-19.

A structured questionnaire was prepared after taking into consideration the inputs received from Nomination and Remuneration Committee, covering various aspects of the Boardâs functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Non - Independent Directors was carried out by the Independent Directors.

The Directors expressed their satisfaction with the evaluation process.

REMUNERATION POLICY

In compliance with the provision of Section 178 of the Companies Act, 2019, the Board has, on the recommendation of the Nomination & Remuneration Committee of the Company, framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management and their remuneration.

The Nomination and Remuneration Policy is set out as Annexure 4 and forms an integral part of this Annual Report and can also be accessed at the website of the Company at the following web link:

https://www.lalpathlabs.com/pdf/brochures/Nomination and Remuneration Policy may.pdf

NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES & DETAILS OF ATTENDANCE

The details of the meetings of the Board of Directors and its Committees and attendance by Directors/Members, convened during the Financial Year 2018-19 are given in the Corporate Governance Report, which forms an integral part of this Annual Report.

DIRECTORSâ RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a) in the preparation of the annual accounts for the Financial Year ended March 31, 2019, the applicable accounting standards and Schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at March 31, 2019 and of the profit and loss of the Company for the Financial Year ended March 31, 2019;

d) the annual accounts have been prepared on a âgoing concernâ basis;

e) proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

AUDITORS AND AUDITORSâ REPORT

I. Statutory Auditors

The shareholders at the 23^rd AGM, approved the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W - 100018), as the Statutory Auditors, for a period of five (5) years i.e. from the conclusion of the 23^rd AGM till the conclusion of 28^th AGM of the Company subject to ratification of appointment by the shareholders at every Annual General Meeting.

However, pursuant to the notification dated May 07, 2018, issued by the Ministry of Corporate Affairs, the requirement for ratification of Statutory Auditors at every Annual General Meeting has been done away with.

Accordingly, M/s. Deloitte Haskins & Sells LLP, Chartered Accountants shall continue as the Statutory Auditors of the Company till the conclusion of 28^th AGM in terms of the shareholders resolution dated July 20, 2017 passed at the 23^rd AGM.

The Auditorsâ Report for the Financial Year ended March 31, 2019, does not contain any qualification, reservation or adverse remark.

Further the Auditorsâ Report being self-explanatory does not call for any further comments from the Board of Directors.

II. Maintenance of cost Records and Cost Auditors

The Board of Directors on the basis of recommendations from Audit Committee has appointed M/s A.G. Agarwal & Associates, Cost Accountants, as cost auditors of the Company for the Financial Year 2019-20 at a fee of Rs. 60,000 (Rupees Sixty Thousand only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the shareholders at the ensuing AGM.

III. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed M/s PDS & Co., Company Secretaries (âSecretarial Auditorsâ) to conduct the Secretarial Audit of your Company for the Financial Year 2018-19.

The Secretarial Audit Report for the Financial Year ended March 31, 2019 is annexed herewith as Annexure 5 and forms an integral part of this Annual Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return of the Company as on March 31, 2019 in Form MGT- 9 in accordance with Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014 is available on the website of the Company at https://www.lalpathlabs.com/pdf/Extract of Annual Return-MGT-9-FY%202018-19 7july2019.pdf and is set out herewith as Annexure 6 and forms an integral part of this Annual Report.

RELATED PARTY TRANSACTIONS

In compliance with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has formulated a Policy on Related Party Transactions which is also available on Companyâs website at https:// www.lalpathlabs.com/pdf/Policy-on-Related-Party-Transactions.pdf.

The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties. All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions for transactions which are of repetitive nature and / or entered in the Ordinary Course of Business and are at Armâs Length.

All related party transaction entered during the year were in Ordinary Course of the Business and on Armâs Length basis. No Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, were entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

LOANS AND INVESTMENTS

Details of Loans, Guarantees given and Investments made by the Company during Financial Year 2018-19 within the meaning of Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014 and Schedule V of the SEBI Listing Regulation, are set out in Note 48 to the Standalone Financial Statements of the Company.

RISK MANAGEMENT

Your Company, through its risk management policy, strives to contain impact and likelihood of the risks within the risk appetite as agreed from time to time with the Board of Directors. The Company has a Risk Management Committee to identify elements of risk in different areas of operations; the details of the Risk Management Committee are included in the Corporate Governance Report.

VIGIL MECHANISM

Your Company has a Vigil Mechanism in place as required under Section 177 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. No matter was reported during the year under review. More details in this regard have been outlined in the Corporate Governance Report annexed to this report and are also available under Investor Section on the Companyâs web-site (www.lalpathlabs.com).

CORPORATE SOCIAL RESPONSIBILITY

For your Company, Corporate Social Responsibility (CSR) means the integration of social, environmental and economic concerns in its business operations. CSR involves operating Companyâs business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of businesses. In alignment with vision of the Company, through its CSR initiative, your Company will enhance value creation in the society through its services, conduct and initiatives, so as to promote sustained growth for the society.

The Board of Directors of your Company has further formulated and adopted a policy on Corporate Social Responsibility which can be accessed at our website at https://www.lalpathlabs.com/pdf/ brochures/CSR-Policy.pdf.

The composition of CSR committee and disclosure as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure 7 and forms an integral part of this Annual Report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in compliance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment.

The Company has complied with the provisions relating to the constitution of Internal Complaints Committee as specified under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company conducts sessions for employees to build awareness amongst employees about the Policy and the provisions of Prevention of Sexual Harassment of Women at Workplace Act.

During the period under review, 6 (Six) complaints were received by the ICC and the same were disposed off.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

I. Conservation of energy and Technology Absorption

- Maintaining power factor (PF) up to .99 (unity). Maintaining up to- 0.9994.

- Recycling of RO waste water and treated lab waste as part of water conservation.

- Post reports of energy Audit of Lab, chiller load is directed to two of the more efficient chillers.

- Descaling done of chillers to improve efficiency and retuned the evaporator pressure drop and condenser water flow to maximize efficiency of chillers.

- Replaced cooling tower fills and eliminator to improve efficiency of cooling tower.

- Reduction in number of chillers operational during off peak hours, and switching on only cooling water pump to maintain set temperature.

- Installing split AC in areas which are operating extended hours to avoid the running of entire floor AHU.

- All utilities functions are operated during off peak hours, this gives advantage of off peak hours Tariff rebate extended by NDPL.

- Optimizing operations of two elevators during peak and off time.

- During winters when the load demand is reduced, we proactively shut down one of the transformer alternately to save transformer loss.

- LED lights change from conventional lights for energy saving exercise.

- Installed 50KW Solar Rooftop power plant system for generation of natural energy saving.

- Additional 50KW Solar Rooftop power plant system for generation of natural energy saving planned for installation this year for both the reference labs at Rohini (NRL) and Kolkata (KRL).

- Replaced the existing cold room unit by energy efficient units.

- Kolkata reference laboratory(KRL) received the âLEED 2009 GOLD certificationâ for Leadership in Energy and Environmental Design (LEED). LEED is a third party verification system for green buildings developed by the U.S. Green Building Council (USGBC). The certification covers all phases of development from design and construction, operations and maintenance to significant retrofits.

II. Foreign exchange earnings and outgo

INTERNAL FINANCIAL CONTROLS

Your Company has in place an adequate internal financial control framework with reference to financial and operating controls thereby ensuring orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information.

During Financial Year 2018-19, such controls were tested and no reportable material weakness in the design or operation was observed.

The Directors have in the Directors Responsibility Statement confirmed the same to this effect.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant/material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of your Company and its operations in future.

COMPLIANCE OF SECRETARIAL STANDARDS

The Company has duly complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors (SS-1) and shareholders (SS-2).

APPRECIATION

For and on behalf of Board of Directors

(Hony) Brig. Dr. Arvind Lal

Chairman & Managing Director

Place: New Delhi DIN: 00576638

Date: May 17, 2019

Mar 31, 2018

BOARD''S REPORT

Dear Members,

The Directors have pleasure in presenting the 24^th Annual Report on the business and operations of your Company along with the audited statement of accounts for the year ended March 31, 2018.

FINANCIAL RESULTS

The Financial performance of your Company for the year ended March 31, 2018 is summarized below:

Particulars	Year ended March 31, 2018 (in '' million)	Year ended March 31, 2017 (in '' million)	Year ended March 31, 2018 (in '' million)	Year ended March 31, 2017 (in '' million)
	Consolidated	Consolidated	Standalone	Standalone
Total Income	10,881.38	9,399.21	10,555.53	9,101.58
Total Expenses	8,268.23	7,030.97	8,002.35	6,789.02
Profit/(Loss) before Tax (PBT)	2,613.15	2,368.24	2,553.18	2,312.56
Profit/(Loss) after Tax (PAT)	1,717.85	1,555.89	1,679.82	1,524.81

FINANCIAL PERFORMANCE

During the year under review, the consolidated income of the Company increased to Rs, 10,881.38 million compared to Rs, 9,399.21 million in the previous year, registering growth of 15.8%. Net profit after tax for the group increased to Rs, 1,717.85 million from Rs, 1,555.89 million representing a growth of 10.4%.

During the year under review, the standalone income of the Company increased to Rs, 10,555.53 million compared to Rs, 9,101.58 million in the previous year, registering growth of 16%. The standalone profit after tax for the year increased by 10.2% to Rs, 1,679.82 million compared to Rs, 1,524.81 million in the previous year.

CONSOLIDATED ACCOUNTS

The consolidated financial statements of your Company for the Financial Year 2017-18, are prepared in compliance with applicable provisions of the Companies Act, 2013, Accounting Standards and Listing Regulations as prescribed by the Securities and Exchange Board of India (SEBI). The consolidated financial statements have been prepared on the basis of audited financial statements of the Company and its Subsidiary Companies, as approved by their respective Board of Directors.

DIVIDEND

During the Financial Year, your Company declared and paid an interim dividend of Rs, 1.50/- per equity share of face value of Rs, 10/each. In addition, your Directors are pleased to recommend a dividend of Rs, 3/- per equity share of face value of Rs, 10/- each as final dividend for the Financial Year 2017-18, for approval of the shareholders at the ensuing Annual General Meeting ("AGM") of the Company.

If approved by the members, the total dividend for the Financial Year shall be Rs, 4.50/- per equity share of face value of Rs, 10/- each.

The Dividend Distribution Policy of the Company is attached herewith as Annexure 1 and forms an integral part of the Annual Report.

TRANSFER TO RESERVES

During the year under review, no amount has been transferred to the General Reserve of the Company.

CHANGES IN SHARE CAPITAL

During the Financial Year 2017-18, the paid - up equity share capital of the Company has been increased from Rs, 83,06,61,840/to Rs, 83,33,27,440/- pursuant to allotment of 2,66,560 Equity Shares of Rs, 10/- each under the Employee Stock Option Plan 2010 of the Company.

UPDATE ON SCHEME OF AMALGAMATION OF DELTA RIA AND PATHOLOGY PRIVATE LIMITED WITH THE COMPANY

Subsequently, the Scheme was filed before the Hon''ble New Delhi Bench of the National Company Law Tribunal (''Hon''ble Tribunal'' or ''NCLT''). The Company in compliance with the directions issued by the Hon''ble Tribunal vide its order dated December 14, 2017 convened meetings of Equity Shareholders and Unsecured Creditors on February 10, 2018 at PHD Chambers of Commerce, No. 4/2 Siri Institutional Area, August Kranti Marg, New Delhi-110016, for approving the said scheme of Amalgamation.

The Scheme was approved by the requisite majority of Equity Shareholders and Unsecured Creditors of the Company in their respective meetings held on February 10, 2018.

The Company subsequently filed a second motion application for approving the said Scheme of Amalgamation before the NCLT on February 23, 2018 and the NCLT has vide its order dated April 17, 2018 fixed the date of hearing as July 02, 2018.

EMPLOYEES STOCK OPTION PLAN / SCHEME

Further the details required to be provided under the SEBI (Share Based Employee Benefits) Regulations, 2014 are disclosed on the website of the Company and can be accessed at https://www. lalpathlabs.com/pdf/Information-as-per-SEBI-Regulations-FY-18.pdf.

SUBSIDIARIES

A report on the performance and financial position of each of the subsidiaries for the year ended March 31, 2018 as per the Companies Act, 2013 is set out in Annexure 2 and forms an integral part of this Annual Report.

The annual accounts of the subsidiaries shall also be made available to the Members of the Company/Subsidiary Companies seeking such information at any point of time. The annual accounts of the subsidiaries are also available for inspection for any Member during business hours at the Registered Office of the Company and Subsidiary Companies and have also been uploaded on the website of the Company (www.lalpathlabs.com).

The Company has formulated a policy for determining material subsidiaries. The policy may be accessed on the website of the Company https://www.lalpathlabs.com/investor/policies-and-programs.aspx.

During the year under review, Dr. Lal Path Labs Bangladesh Private Limited become a subsidiary of the Company as a result of the acquisition of its 70% stake by the Company.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report forms an integral part of this Annual Report and gives details of the overall industry structure, developments, performance and state of affairs of the Company''s business and other material developments during the Financial Year.

BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report (''BRR'') forms an integral part of this Annual Report. The Report provides a detailed overview of initiatives taken by your Company from environmental, social and governance perspectives.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

No material changes and commitments, other than disclosed as part of this report, affecting the financial position of the Company have occurred between March 31, 2018 and the date of the report.

PUBLIC DEPOSITS

During the Financial Year 2017-18, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.

CORPORATE GOVERNANCE REPORT

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 a separate report on corporate governance along with a certificate from the Practicing Company Secretary on its compliance, forms an integral part of this Annual Report.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014 are provided in the prescribed format and annexed herewith as Annexure 3 to this Report.

The statement containing particulars of employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure forming part of this report. Further, the Report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company till the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary.

AUDIT COMMITTEE

The composition of Audit Committee has been detailed in the Corporate Governance Report, forming part of this Annual Report.

All recommendations made by the Audit Committee have been accepted by the Board of Directors.

DIRECTORS I. Retirement by rotation and subsequent re-appointment:

Dr. Vandana Lal, Whole Time Director is liable to retire by rotation at the ensuing AGM pursuant to the provisions of Section 152 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules,

2014 and being eligible offers herself for reappointment. Appropriate resolution for her re-appointment is being placed for the approval of the shareholders of the Company at the ensuing AGM. The Brief profile of Dr. Vandana Lal and other related information has been detailed in the Notice convening the 24^th AGM of your Company.

II. Re-appointment of Independent Directors:

The term of office of Mr. Arun Duggal, Mr. Anoop Mahendra Singh, Mr. Harneet Singh Chandhoke, Mr. Sunil Varma and Dr. Saurabh Srivastava, as Independent Directors expires on August 20, 2018. The Board of Directors based on performance evaluation of all the above Independent Directors, recommends their re-appointment to the shareholders for a second term of five (5) consecutive years commencing from August 21, 2018. Brief profile of all the above Independent Directors and other related information has been detailed in the Notice convening the 24^th AGM of your Company

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules issued there under as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In the opinion of the Board, Independent Directors fulfill the conditions specified in Companies Act, 2013 read with the Schedules and Rules issued there under as well as SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and are independent from Management.

KEY MANAGERIAL PERSONNEL

1. (Hony) Brig. Dr. Arvind Lal - Chairman and Managing Director

2. Dr. Om Prakash Manchanda - CEO and Whole Time Director

3. Dr. Vandana Lal - Whole Time Director

4. Mr. Dilip Bidani - Chief Financial Officer; and

5. Mr. Rajat Kalra - Company Secretary

ANNUAL EVALUATION OF BOARD''S PERFORMANCE:

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out annual performance evaluation of its own performance, the Directors individually as well as the evaluation of all Committees of the Board for the Financial Year 2017-18. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Non Independent Directors was carried out by the Independent Directors.

The Directors expressed their satisfaction with the evaluation process.

REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee of the Company framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management and their remuneration.

The Policy is set out as Annexure 4 and forms an integral part of this Annual Report.

NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES & DETAILS OF ATTENDANCE

The details of the meetings of the Board of Directors and its Committees and attendance by Directors/Members, convened during the Financial Year 2017-18 are given in the Corporate Governance Report, which forms an integral part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors confirm that:

a) in the preparation of the annual accounts for the Financial Year ended March 31, 2018, the applicable accounting standards and Schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same;

b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at March 31, 2018 and of the profit and loss of the Company for the Financial Year ended March 31, 2018;

d) the annual accounts have been prepared on a ''going concern'' basis;

e) proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

AUDITORS AND AUDITORS'' REPORT

I. Statutory Auditors

The shareholders at the 23^rd AGM, approved the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W - 100018), as the Statutory Auditors, for a period of five (5) years i.e. from the conclusion of the 23^rd AGM till the conclusion of 28^th AGM of the Company subject to ratification of the appointment by the shareholders at every Annual General Meeting.

The Auditors'' Report for the Financial Year ended March 31, 2018, does not contain any qualification, reservation or adverse remark.

Further the Auditors'' Report being self-explanatory does not call for any further comments from the Board of Directors.

II. Cost Auditors

In terms of the Section 148 of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost accounting records and get them audited every year. The Board of Directors on the basis of recommendations from Audit Committee has appointed M/s A.G. Agarwal & Associates, Cost Accountants, as cost auditors of the Company for the Financial Year 2018-19 at a fee of '' 60,000 (Rupees Sixty Thousand only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the shareholders at the ensuing AGM.

III. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed M/s PDS & Co., Company Secretaries ("Secretarial Auditors") to conduct the Secretarial Audit of your Company for the Financial Year 2017-18.

The Secretarial Audit Report for the Financial Year ended March 31, 2018 is annexed herewith as Annexure 5 and forms an integral part of this Annual Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return of the Company as on March 31, 2018 in Form MGT- 9 in accordance with Section 92(3) of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, are set out herewith as Annexure 6 and forms an integral part of this Annual Report.

RELATED PARTY TRANSACTIONS

In line with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has formulated a Policy on Related Party Transactions which is also available on Company''s website at https://www. lalpathlabs.com/investor/policies-and-programs.aspx. The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and Related Parties. All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions on a quarterly basis for transactions which are of repetitive nature and / or entered in the Ordinary Course of Business and are at Arm''s Length.

All Related Party Transactions entered during the year were in Ordinary Course of the Business and on Arm''s Length basis. No Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, were entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

LOANS AND INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 read with the Companies (Meetings of Board and its Powers) Rules, 2014, as on March 31, 2018, are set out in Note 13, 15B and 16 to the Standalone Financial Statements of the Company.

RISK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner. Your Company periodically assesses risks in the internal and external environment, along with the cost of treating risks and incorporates risk treatment plans in its strategy, business and operational plans. As on the date of this report, the Company does not foresee any critical risk, which threatens its existence.

Your Company, through its risk management policy, strives to contain impact and likelihood of the risks within the risk appetite as agreed from time to time with the Board of Directors.

VIGIL MECHANISM

Your Company has a Vigil Mechanism in place as required under Section 177 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. No matter was reported during the year under review. More details in this regard have been outlined in the Corporate Governance Report annexed to this report and are also available under Investor Section on the Company''s web-site (www.lalpathlabs.com).

CORPORATE SOCIAL RESPONSIBILITY

For your Company, Corporate Social Responsibility (CSR) means the integration of social, environmental and economic concerns in its business operations. CSR involves operating Company''s business in a manner that meets or exceeds the ethical, legal, commercial and public expectations that society has of businesses. In alignment with vision of the Company, through its CSR initiatives, your Company will enhance value creation in the society through its services, conduct and initiatives, so as to promote sustained growth for the society.

The Board of your Company has further formulated and adopted a policy on Corporate Social Responsibility. The CSR Policy of your Company outlines the Company''s philosophy for undertaking socially useful programs through the creation of a CSR Trust for welfare and sustainable development of the community at large as part of its duties as a responsible corporate citizen.

The disclosure as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 is annexed as Annexure 7 and forms an integral part of this Annual Report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company conducts sessions for employees to build awareness amongst employees about the Policy and the provisions of Prevention of Sexual Harassment of Women at Workplace Act.

During the period under review, 2 (Two) complaints were received by the ICC, of which 1 (one) was disposed of and the other one was under review as of March 31, 2018.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section

134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is set out hereunder:

I. Conservation of energy and Technology Absorption

- Maintaining power factor (PF) up to .99 (unity).

- Contract electricity demand of the building moderated biannually in accordance with operational demand, leading to reduction of fixed charges during lean period.