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Directors Report of Lupin Ltd.

Mar 31, 2023

Your Directors are pleased to present their report on business and operations of your Company for the year ended March 31, 2023.

Financial Results

('' in million)

Standalone

Consolidated

2022-23

2021-22

2022-23

2021-22

Sales

110430.7

112584.8

162699.8

161927.9

Other operating income

2157.6

5131.9

3716.8

2126.9

Other Income

912.6

1504.2

733.6

1416.9

Profit before business compensation expense, interest, depreciation and tax

11739.2

23045.1

18714.8

23072.9

Less: Business compensation expense

-

18783.8

-

18783.8

Less: Finance costs

984.4

734.7

2743.0

1427.7

Less: Depreciation, amortisation and impairment expenses

5483.4

5141.9

8806.9

16587.1

Profit/(Loss) before share of profit from Jointly Controlled Entity and Tax

5271.4

(1615.3)

7164.9

(13725.7)

Add: Share of profit from Jointly Controlled Entity

-

-

-

3.6

Less: Provision for taxation (including deferred tax)

1019.3

271.7

2688.0

1371.5

Profit/(Loss) after tax

4252.1

(1887.0)

4476.9

(15093.6)

Share of Profit/(Loss) attributable to Non-controlling Interest

-

-

176.1

186.8

Net Profit/(Loss) attributable to Shareholders of the Company

4252.1

(1887.0)

4300.8

(15280.4)

Performance Review

Consolidated Revenue from Operations for the year ended March 31, 2023 was '' 166416.6 million. International business contributed 60.4%. Consolidated profit before tax was '' 7164.9 million. Net Profit after tax was '' 4300.8 million, as against loss of '' 15280.4 million in FY 2021 - 22. Earnings per share (Basic) stood at '' 9.46.

Dividend

Your Directors recommend dividend of 200%

('' 4/- per equity share). The total dividend amount is '' 1820.1 million.

Pursuant to Regulation 43A(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (''Listing Regulations''), the Dividend Distribution Policy has been hosted on the website of the Company www.lupin.com (weblink: https://www.lupin.com/wp-content/ uploads/2023/04/Dividend-Distribution-Policy.pdf.

Share Capital

Consequent to the allotment of 506321 equity shares of '' 2/- each, during the year, to employees of the Company and its subsidiaries upon exercising

vested options under various stock option plans, the paid-up share capital of the Company increased by '' 1 million. The paid-up equity share capital as on March 31, 2023 was '' 910 million.

Credit Rating

ICRA Limited (''ICRA'') assigned the rating ‘A1 '' (pronounced ''ICRA A one plus'') for the Company''s bank facilities of '' 30000 million, which indicates very strong degree of safety regarding timely payment of financial obligations.

Subsidiary Companies/Joint Venture

As on March 31, 2023, the Company had 28 subsidiaries and a joint venture.

In compliance with the first proviso to Section 129(3) of the Companies Act, 2013 (''Act'') and Rules 5 and 8(1) of the Companies (Accounts) Rules,

2014, salient features of the financial statements, performance and financial position of each subsidiary and joint venture are given in Form No. AOC - 1 as Annexure ‘A'' to this Report. Pursuant to Section 136 of the Act, financial statements of subsidiaries and a joint venture are available for

inspection by Members at the registered office of the Company during business hours. The Company shall provide a copy of the financial statements of its subsidiaries and a joint venture to Members free of cost upon their request. The said financial statements are also available on the Company''s website www.lupin.com.

Pursuant to Regulation 46(2)(h) of the Listing Regulations, policy for determining material subsidiaries has been hosted on the Company''s website www.lupin.com (web link: https:// www.lupin.com/wp-content/uploads/2021/04/ policy-for-determining-material-subsidiaries.pdf. Nanomi B.V., the Netherlands (''Nanomi''), Lupin Atlantis Holdings SA, Switzerland (''LAHSA'') and Lupin Pharmaceuticals, Inc., USA (''LPI''), are wholly owned material subsidiaries of the Company.

In compliance with Regulation 24(1) of the Listing Regulations, Mr. Mark D. McDade, Independent Director, is on the Board of Nanomi and Mr. Jean-Luc Belingard, Independent Director, is on the Boards of LAHSA and LPI.

Integrated Report

In the fast-evolving corporate landscape, Integratec Reporting is an ideal tool to explore value creation. The Integrated Report is focused on driving authentic, comprehensive and meaningful information covering all aspects of the Company''s performance. It encompasses financial and non-financial information, to help Members have a better understanding of the Company''s long-term perspective and take well-informed decisions.

The Report inter-alia covers the Company''s strategy, governance framework, performance, prospects and value creation on the six forms of capital i.e. financial capital, human capital, manufacturing capital, social capital, intellectual capital and natural capital.

Management Discussion and Analysis

In compliance with Regulation 34(3) read with Schedule V(B) of the Listing Regulations, Management Discussion and Analysis forms part of the Integrated Report.

Corporate Governance Report

As stipulated by Regulation 34(3) read with Schedule V(C) of the Listing Regulations, a report on Corporate Governance forms part of the Integrated Report. In terms of Schedule V(E) of the Listing Regulations, Auditors'' certificate confirming compliance with the conditions of corporate governance is annexed to the Corporate Governance Report. The Company is committed

to benchmark itself with the highest standards of corporate governance and ethical practices.

Business Responsibility and Sustainability Report

In compliance with Regulation 34(2)(f) of the Listing Regulations, Business Responsibility and Sustainability Report forms part of the Integrated Report.

Corporate Social Responsibility

Corporate Social Responsibility (''CSR'') activities of the Company are mainly routed through its social responsibility arm Lupin Human Welfare and Research Foundation (''LHWRF''). LHWRF was established by Dr. Desh Bandhu Gupta, the founder Chairman of the Company, to serve the poor, outreaching the neediest and most excluded geographies in India. Over the last three decades, LHWRF has worked with 5,431 villages across nine states in India, positively impacting the lives of over twelve lakh families.

A detailed write-up on Company''s initiatives towards CSR forms part of the Integrated Report.

The CSR Policy, approved by the Board of Directors, has been hosted on the Company''s website www.lupin.com. Details of CSR activities undertaken by the Company are given in Annexure ‘B’ to this Report.

Directors’ Responsibility Statement

In compliance with the provisions of Section 134(3) (c) read with Section 134(5) of the Act, to the best of their knowledge and belief your Directors confirm that: -

i) in the preparation of the annual financial statements for the year ended March 31, 2023, the applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) they had 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 at the end of the financial year March 31, 2023 and of the profit of your Company for the year;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) the annual financial statements have been prepared on a going concern basis;

v) they had laid down proper internal financial controls and that the same are adequate and were operating effectively; and

vi) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Directors

As recommended by the Nomination and Remuneration Committee (''NRC''), the Board, at its meeting held on May 9, 2023, re-appointed Mr. Nilesh D. Gupta, Managing Director,

(DIN: 01734642), for a period of five years, effective September 1, 2023, subject to approval of Members, by way of an Ordinary Resolution at the ensuing Annual General Meeting (''AGM'').

Mr. Nilesh D. Gupta is a Chemical Engineer from the University Department of Chemical Technology (UDCT), Mumbai and a graduate with honors from the Wharton School, University of Pennsylvania, USA, where he specialised in healthcare, strategic management and finance. Mr. Gupta has been instrumental in formulating and executing the core strategy that has helped the Company emerge as a global specialty and complex generics pharmaceutical powerhouse. Mr. Gupta is Member of the Audit Committee, Stakeholders'' Relationship Committee, CSR Committee and Risk Management Committee.

Dr. Kamal K. Sharma, Non-Executive Vice Chairman, (DIN: 00209430), stepped-down from the Board of Directors of the Company effective October 14,

2022. Dr. Sharma was on the Board of the Company for over 19 years. He helped lead the Company in setting the vision and strategic direction, assessing inorganic growth initiatives, and mentoring senior management. The Company immensely benefited from his guidance, rich experience and advice.

The Board and the Management places on record their sincere appreciation for the services rendered by Dr. Sharma during his long association with the Company.

Ms. Christine Mundkur, Independent Director,

(DIN: 08408494), stepped-down from the Board of Directors of the Company, effective January 1,

2023, to avoid any conflict of interest since she joined the Board of Cardinal Health, USA as an Independent Director. The Company immensely benefited from her skills, expertise, competencies, wide experience in the pharma industry and

valuable advice. The Board and the Management places on record their sincere appreciation for the services rendered by Ms. Mundkur during her association with the Company.

In accordance with the provisions of Section 152 of the Act, Mr. Ramesh Swaminathan, Executive Director, Global CFO & CRO and Head - Corporate Affairs, (DIN: 01833346), retires by rotation at the ensuing AGM and is eligible for re-appointment.

Mr. Ramesh Swaminathan brings to the Company rich experience of over three decades. In addition to having worked with the Company for over 13 years, he has also worked with reputed organisations in diverse industry sectors. Mr. Ramesh has worked with VST Industries Ltd., SPIC Group, Standard Chartered Bank, Henkel and L&T. As CFO, he has won several accolades with coveted awards being conferred on him. Mr. Ramesh is a qualified Chartered Accountant, Cost Accountant and Company Secretary. In addition to being a Lord Chevening Scholar, UK, Mr. Ramesh completed an advanced management program from INSEAD, France. He is Member of the Risk Management Committee of the Board. Mr. Ramesh is Chief Risk Officer of the Company and Member of its Leadership team.

In terms of Regulation 17(1A) of the Listing Regulations, approval of Members, vide Special Resolution shall be sought at the ensuing AGM of the Company, for the continuation of directorship of Mr. Jean-Luc Belingard, Independent Director,

(DIN: 07325356), who shall attain the age of 75 years on October 28, 2023.

Mr. Jean-Luc Belingard, a French national, graduated from Ecole des Hautes Etudes Commerciales, France and completed Master of Business Administration from Cornell University, USA. Mr. Belingard started his career with Merck, Sharp and Dohme before moving to F. Hoffman-La Roche, Basel, Switzerland.

He was Member of the Executive Committee,

F. Hoffman-La Roche and CEO, Roche Diagnostics, Basel, Switzerland. Mr. Belingard was CEO, bioMerieux-Pierre Fabre, France. He was Chairman & CEO, Ipsen Group, France. In the past, Mr. Belingard was also on the board of Laboratoire Pierre Fabre, France. Mr. Belingard joined bioMerieux S.A. as CEO and became its Chairman. He was a Member of the Bill and Melinda Gates Foundation. He is also Foreign Trade Advisor to the French Government. Mr. Belingard has been conferred upon the prestigious National Awards, Chevalier de I''Ordre National du Merite

and Chevalier de la Legion d''Honneur awards.

Mr. Belingard is Chairman of the Nomination & Remuneration Committee of the Company. He is also on the Boards of Lupin Pharmaceuticals, Inc., USA and Lupin Atlantis Holdings S.A., Switzerland, material subsidiaries of the Company.

In compliance with the provisions of Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations, all Independent Directors have furnished declarations that they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and that there has been no change in the circumstances affecting their status as Independent Directors of the Company.

During the year, eight Board meetings were held on May 18, 2022, June 15, 2022, August 3, 2022, October 7, 2022, October 10, 2022, November 9, 2022, December 21, 2022 and February 9, 2023, details of which, are given in the Corporate Governance Report which forms part of the Integrated Report.

Board Evaluation

In compliance with provisions of Section 134(3)(p) of the Act and Rule 8(4) of the Companies (Accounts) Rules, 2014, the Board carried out an annual evaluation of its own performance, that of each Director including Chairman as also Committees of the Board. In line with SEBI guidance note, board evaluation was carried out in a structured manner on qualitative parameters based on feedbacks on questionnaire. In terms of Regulation 17(10) of the Listing Regulations, performance evaluation of Independent Directors was carried out by the Board without the participation of the Director being evaluated.

The Independent Directors carried out performance evaluation of non-independent directors, the Board as a whole and Chairman of the Company.

In evaluating performance of the Board, criteria such as involvement in long-term strategic planning, participation in Board and Committee meetings, Board composition and structure, effectiveness of Board processes, monitoring corporate governance practices, Board communication and relationship etc. were taken into consideration. Performance evaluation of Committees was reviewed by the Board after taking into account criteria viz. composition of Committees, attendance and participation, effectiveness of Committee meetings, fulfillment of functions assigned to the Committees, frequency and adequacy of time allocated for discussions at meetings, etc.

While evaluating the performance of individual Directors, criteria such as leadership qualities, qualifications, responsibilities shouldered, contributions at meetings, analytical skills, knowledge, attendance, preparedness on the issues discussed and also parameters such as, initiative, independent judgement, understanding the business environment/strategic issues were considered. The Board agreed to further improve the effectiveness and functioning of the Board and Committees.

Audit Committee

The Audit Committee comprises of Dr. Punita Kumar-Sinha (Chairperson), Mr. K. B. S. Anand, Independent Directors and Mr. Nilesh D. Gupta, Managing Director.

Dr. Kamal K. Sharma, Non-Executive Vice Chairman and Ms. Christine Mundkur, Independent Director were Members of the Audit Committee up to October 13, 2022 and December 31, 2022, respectively. Mr. Anand and Mr. Gupta were appointed Members of the Audit Committee w.e.f. October 13, 2022 and January 1, 2023, respectively.

Mr. R. V. Satam, Company Secretary, acts as the Secretary of the Committee. All recommendations made by the Audit Committee were accepted by the Board. The functions performed by the Committee, particulars of meetings held and attendance of the Members at the said meetings are mentioned in the Corporate Governance Report, which forms part of the Integrated Report.

Nomination and Remuneration Policy

The Board has on the recommendation of the Nomination and Remuneration Committee (''NRC''), formulated a Nomination and Remuneration Policy pertaining to remuneration of directors, key managerial personnel and senior management as stipulated by Section 178(3) of the Act and Regulation 19(4) of the Listing Regulations.

The policy lays down guiding principles, philosophy and basis for recommending payment of remuneration to executive/non-executive directors and key managerial personnel. It includes criteria for determining qualifications, positive attributes and independence of directors. The NRC evaluates balance of skills, knowledge and experience of Independent Directors and recommends them to the Board for appointment as mentioned in the Policy. The functions of the NRC are disclosed in the Corporate Governance Report, which forms part of the Integrated Report. In compliance with proviso to Section 178(4) of the Act, the policy has been hosted on the Company''s website

www.lupin.com (web link: https://www.lupin.com/

wp-content/uploads/2023/04/nomination-and-

remuneration-policy-LL-2023.pdf).

Related Party Transactions

All transactions entered by the Company with the related parties during the financial year were in the ordinary course of business and on an arm''s length basis in accordance with the Act and Rules made thereunder and the Listing Regulations.

No transaction with related parties conflicted with the interests of the Company and that material related party transactions were entered into by the Company only with its subsidiaries. There is no pecuniary transaction with any director, apart from remuneration and sitting fees, which had potential conflict of interest with the Company. In compliance with the Act and Listing Regulations, the Independent Directors of the Audit Committee periodically review and approve related party transactions. Pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014, disclosure of particulars of contracts/arrangements entered into by the Company with related parties are given in Form No. AOC - 2, as Annexure ‘C'' to this Report. As mandated by Regulation 46(2)(g) of the Listing Regulations, the policy on ''Related party transactions and materiality of related party transactions'', as approved by the Board is available on the Company''s website www.lupin. com and web link for the same is https:// www.lupin.com/wp-content/uploads/2022/03/ rpt-policy-03-02-2022.pdf

Risk Management

The Company has a consistent, structured and defined continuous process for identifying, assessing, deciding on responses to and reporting on critical ''risks that matter''. The Risk Management framework of the Company essentially comprises of two elements i.e. the process to identify, prioritise and manage risks adopting the value-based driver tree approach and risk mitigation action plan. The Risk Management framework applies to all business units, functions, geographies and departments within the Company. It compliments and does not replace other existing programs, such as those relating to emission, quality and compliance matters. Composition, frequency and quorum of meetings of the Risk Management Committee constituted by the Board is in compliance with Regulation 21 of the Listing

Regulations. Roles, responsibilities and functions of the Committee have been defined by the Board. Terms of reference of the Committee, details of meetings held and attendance thereat are mentioned in the Corporate Governance Report, which forms part of the Integrated Report. Mr. Ramesh Swaminathan, Executive Director,

Global CFO & CRO and Head - Corporate Affairs, Chief Risk Officer, drives the ESG integration and adoption across the Company and brings a more nuanced understanding and blend of both ESG and business to the table.

Particulars of loans/guarantees/ investments/securities

In compliance with provisions of Section 134(3)(g) of the Act, particulars of loans, guarantees, investments and securities given under Section 186 of the Act are disclosed in the notes to the financial statements forming part of the Integrated Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

As stipulated by Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, information as regards conservation of energy, technology absorption and foreign exchange earnings and outgo is given in Annexure ‘D'' to this Report.

Human Resources

Employees are the most valuable assets of the Company. Providing support and care to the employees is part of the Company''s DNA and it strives to create an environment conducive to their development. Systems, policies, technology and business functions of the Company are aligned with industry best practices which enables the Company to provide fair, professional and diverse work environment to its employees.

As stipulated by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has constituted an Internal Complaints Committee. Employees are regularly sensitized about matters pertaining to prevention of sexual harassment.

Employees Stock Options

Pursuant to provisions of Regulation 14 of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, details of stock options as on March 31, 2023, are given in Annexure ‘E'' to this Report.


Vigil Mechanism/Whistleblower Policy

Your Company has established a reputation for conducting its business with uncompromising integrity by strictly abiding to well-accepted norms of ethical, lawful and moral conduct and has zero tolerance for any form of unethical behaviour.

In terms of Section 177(9) and (10) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the Listing Regulations, the Company has in place a robust Vigil mechanism/Whistleblower Policy for directors and employees to report concerns, details of which are covered in the Corporate Governance Report which forms part of the Integrated Report.

In compliance with Regulation 18(3) read with Schedule II Part C(18) of the Listing Regulations, the Audit Committee reviews the functioning of the Vigil mechanism/Whistleblower Policy.

Directors and employees are at liberty to report unethical practices and raise their concerns to the office of the Ombudsperson without any fear of retaliation or retribution. Complaints, including anonymous ones are investigated/examined by teams of strategic business unit heads/officers appointed by the Ombudsperson and the same are swiftly redressed. The office of the Ombudsperson has official authority to receive, respond and investigate all offences within the scope of this policy. No person has been denied access to the Chairperson of the Audit Committee.

During the year, the Ombudsperson received 22 complaints, mostly of minor nature.

The Vigil mechanism/Whistleblower Policy is hosted on the Company''s website https:// www.lupin.com/wp-content/uploads/2022/02/ Whistleblower-Policy-Website.pdf.

Particulars of Employees Remuneration

Particulars of remuneration of employees required to be disclosed pursuant to the provisions of Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given in Annexure ‘F'' to this Report. Particulars of remuneration of employees, for the year ended March 31, 2023, required to be furnished in terms of Rules 5(2) and 5(3) of the said Rules, forms part of this Report and shall be provided to Members upon written request pursuant to second proviso of Rule 5. Pursuant to provisions of Section 136(2) of the Act, particulars of remuneration of employees are available for inspection by Members at the

Registered office of the Company during business hours on all working days up to the date of the ensuing AGM.

Auditors

At the 39th AGM held on Tuesday, August 10, 2021, Members re-appointed B S R & Co. LLP, Chartered Accountants (Firm Reg. No. 101248W/W-100022), as auditors of the Company, for a second term of five years from the conclusion of the 39th AGM till the conclusion of the 44th AGM. Pursuant to the provisions of Section 141 of the Act, the Company has received a certificate from B S R & Co. LLP, certifying that their appointment is in compliance with the conditions prescribed by the said Section. The Company continues to have unqualified audit reports.

Internal Audit

The in-house corporate internal audit team carries out Internal audit of the Company''s operations.

The strength of the in-house corporate internal audit team is adequate to undertake audits. Local chartered accountant firms regularly conduct audits of Carrying & Forwarding Agents and Central Warehouses of the Company in India. Internal audit findings are presented at the Audit Committee meetings. Services of external auditors/specialist firms are engaged for undertaking special audit assignments, as required.

Cost Audit

In compliance with provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014 and as recommended by the Audit Committee, the Board of Directors, at its meeting held on May 18,

2022, appointed Mr. S. D. Shenoy, Practising Cost Accountant (FCMA No. 8318), as Cost Auditor, to conduct cost audit for the year ended March 31,

2023. Mr. Shenoy is a Cost Accountant as defined under Section 2(1)(b) of the Cost and Works Accountant Act, 1959 and holds a valid certificate of practice. Mr. Shenoy confirmed that he is free from the disqualifications specified in Section 141 read with Sections 139 and 148 of the Act and that his appointment meets the requirements prescribed in Sections 141(3)(g) and 148 of the Act. Mr. Shenoy also confirmed that he was independent, maintained an arm''s length relationship with the Company and that no orders or proceedings were pending against him relating to matters of professional conduct before the Institute of Cost Accountants of India or any competent court/authority.

In terms of Rule 14 of the Companies (Audit and Auditors) Rules, 2014, remuneration of the cost auditor is required to be ratified by Members. Accordingly, the Members vide an ordinary resolution at the 40th AGM held on August 3, 2022, ratified the remuneration payable to Mr. Shenoy, for conducting cost audit for the year ended March 31, 2023.

The Company has duly maintained cost records as specified by the Central Government under Section 148(1) of the Act.

Pursuant to provisions of Section 148(6) of the Act read with Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014, cost audit report, in Form No. CRA-4 (in XBRL mode), for the year ended March 31, 2022, was filed with the Ministry of Corporate Affairs, well within the prescribed time.

Secretarial Audit and Annual Secretarial Compliance Reports

At its meeting held on May 18, 2022, the Board of Directors appointed Ms. Neena Bhatia, Practising Company Secretary (FCS No. 9492 CP. No. 2661), to undertake Secretarial Audit and issue Annual Secretarial Compliance Report for the year ended March 31, 2023.

Pursuant to the provisions of Section 204 of the Act read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board, at its meeting held on May 9, 2023, took on record, the Secretarial Audit Report (Form No. MR-3) which is enclosed as Annexures ‘G'' and ‘G-1'' to this Report. The Company continues to have an unqualified Secretarial Audit Report.

In compliance with Regulation 24A(2) of the Listing Regulations, the Board, at its meeting held on May 9, 2023, took on record, the Annual

Secretarial Compliance Report for the year ended March 31, 2023. The Report, which is in the format suggested by The Institute of Company Secretaries of India (''ICSI''), confirms that the Company has maintained proper records as stipulated under various Rules and Regulations and that, no action has been taken against the Company or its material subsidiaries or promoters/directors by SEBI/BSE/ NSE. The Company shall disseminate the Report on the websites of BSE and NSE within the prescribed time.

Compliance with Secretarial Standards

The Company continues to comply with Secretarial Standards on Board Meetings (SS-1) and General Meetings (SS-2), including amendments thereto, issued by ICSI.

Annual Return

In compliance with Sections 92(3) and 134(3)(a) of the Act, the Annual Return of the Company for the year ended March 31, 2023, has been hosted on the Company''s website www.lupin.com and web link for the same is https://www.lupin.com/investors/ reports-filings/.

Acknowledgements

Your Directors commend all employees of the Company for their dedication, commitment, hard work and contributions. The Board wishes to express its deep gratitude and looks forward to the continued support of the Central and State governments, banks, financial institutions, local bodies/associations, stakeholders, medical professionals, analysts and business associates.

For and on behalf of the Board of Directors

Manju D. Gupta Chairman

(DIN: 00209461) Mumbai, May 9, 2023


Mar 31, 2022

Your Directors present their report on business and operations of your Company for the year ended March 31, 2022.

Financial Results

('' in million)

Standalone

Consolidated

2021-22

2020-21

2021-22

2020-21

Sales

112584.8

109010.2

161927.9

149269.9

Other operating income

5131.9

1549.1

2126.9

2359.7

Other Income

1504.2

1290.9

1416.9

1362.9

Profit before business compensation expense, interest, depreciation and tax

23045.1

21731.5

23072.9

27031.7

Less: Business compensation expense

18783.8

-

18783.8

-

Less: Finance costs

734.7

406.2

1427.7

1406.4

Less: Depreciation, amortisation and impairment expenses

5141.9

5028.3

16587.1

8874.1

Profit/(Loss) before share of profit from Jointly Controlled Entity and Tax

(1615.3)

16297.0

(13725.7)

16751.2

Add: Share of profit from Jointly Controlled Entity

-

-

3.6

13.3

Less: Provision for taxation (including deferred tax)

271.7

3710.8

1371.5

4485.2

Profit/(Loss) after tax

(1887.0)

12586.2

(15093.6)

12279.3

Profit/(Loss) after tax and before non-controlling interest

(1887.0)

12586.2

(15093.6)

12279.3

Share of Profit/(Loss) attributable to Non-controlling Interest

-

-

186.8

114.0

Net Profit/(Loss) attributable to Shareholders of the Company

(1887.0)

12586.2

(15280.4)

12165.3

Performance Review

Sales for the year ended March 31, 2022, was '' 161927.9 million, growth of 8.5%. During the year, due to a few one-offs (business compensation expense and impairment of certain IPs), the Company reported net loss of '' 15280.4 million.

Business compensation expense relate to settlement of a dispute by the Company and its subsidiary, with respect to antitrust class in the USA, in connection with the drug Glumetza® (used for treatment of diabetes), without admitting any liability for any wrongdoing. The settlement payment is compensatory and not penal for any offense or violation of law. The total amount was USD 252.9 million ('' 18783.8 million) [including USD 4.9 million ('' 374.8 million) towards litigation and settlement related expenses]. The entire amount has been paid during the year. Also, impairment provisions of '' 8402.1 million in respect of certain acquired IPs consequent to adverse market conditions were made. Earnings per share (Basic) stood at ('' 33.65).

The year was challenging with headwinds in the U.S. on account of price erosion, and inflation in input

materials and freight. Other markets continue solid growth in revenues and profitability. The Company is focused on optimising operating expenses and spend, and ensuring the evolution of the Company''s complex generic platforms along with global portfolio maximization while doubling down on markets like India. The Company expects its efforts to yield meaningful uptick in profitability in future.

COVID-19 Pandemic

Multiple Covid waves were challenging for all of us as new variants affected diverse geographies at different times, thereby significantly impacting lives and livelihoods. The last wave witnessed low hospitalisation and mortality rates. Safety protocols remained in place and the leadership team of your Company closely monitored all regions.

The measures adopted by the Company helped in maintaining smooth operations and protected team health. Enhanced controls, ensured uninterrupted flow of products throughout the pandemic.

Dividend

Your Directors recommend dividend of 200%

('' 4/- per equity share). The total dividend amount is '' 1818 million.

In compliance with Regulation 43A(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), Dividend Distribution Policy has been hosted on the website of the Company www.lupin.com (web link: https://www.lupin.com/ wp-content/uploads/2021/04/dividend-distribution-policy.pdf).

Share Capital

During the year, the paid-up share capital of the Company increased by '' 1.6 million consequent to the allotment of 794881 equity shares of '' 2/- each to employees of the Company and its subsidiaries upon exercising vested options under various stock option plans. Paid-up equity share capital as on March 31, 2022 was '' 909 million.

Credit Rating

ICRA Limited (ICRA) has assigned the rating ''A1 ’ (pronounced ''ICRA A one plus'') for the Company''s bank facilities of '' 26780 million, which indicates very strong degree of safety regarding timely payment of financial obligations.

Subsidiary Companies/Joint Venture

As on March 31, 2022, the Company had 28 subsidiaries and a joint venture.

Lupin Digital Health Limited, wholly owned subsidiary of the Company, was incorporated on May 21, 2021, to leverage technology and build digital platforms to support doctors in managing health of patients.

As part of business expansion, Avenue Coral Springs, LLC, USA, wholly owned subsidiary of the Company, was incorporated on November 29, 2021.

Southern Cross Pharma Pty. Limited, Australia (Southern Cross), wholly owned subsidiary of the Company, was acquired on February 3, 2022. Southern Cross, which is in the business of registration and distribution of generic pharmaceutical formulations through hospitals and pharmaceutical companies in Australia, shall reinforce the leading position of the Company in the generics market of Australia.

As part of restructuring, Lupin Latam, Inc., USA, wholly owned subsidiary of the Company, was liquidated effective August 31, 2021.

In accordance with first proviso to Section 129(3) of the Companies Act, 2013 (Act) and Rules 5 and 8(1) of the Companies (Accounts)

Rules, 2014, salient features of the financial statements, performance and financial position of each subsidiary and joint venture are given in Form No. AOC - 1 as Annexure ''A’ to this Report. Financial statements of subsidiaries and joint

venture are available for inspection by Members at the registered office of the Company during business hours as stipulated under Section 136 of the Act. The Company shall provide free of cost, a copy of the financial statements of its subsidiaries and joint venture to Members upon their request.

The said financial statements are also available on the Company''s website www.lupin.com.

Pursuant to Regulation 46(2)(h) of the Listing Regulations, the Company formulated a policy for determining material subsidiaries. The said policy is available on the Company''s website www.lupin. com (web link: https://www.lupin.com/wp-content/ uploads/2022/03/rpt-policy-03-02-2022.pdf).

Integrated Report

The key initiatives taken by the Company with respect to strategy, governance framework, performance and value creation are provided separately in six forms of capital viz. financial capital, human capital, manufacturing capital, social capital, intellectual capital and natural capital in the Integrated Report. The Report encompasses financial and non-financial information, to help Members take well-informed decisions and have a better understanding of the Company''s long-term perspective.

Management Discussion and Analysis

As stipulated under Regulation 34(3) read with Schedule V(B) of the Listing Regulations, Management Discussion and Analysis forms part of the Integrated Report.

Corporate Governance Report

Your Directors reaffirm their commitment to adhere to the highest standards of corporate governance and ethical practices. In compliance with Regulation 34(3) read with Schedule V(C) of the Listing Regulations, a Report on Corporate Governance forms part of the Integrated Report. In terms of Schedule V(E) of the Listing Regulations, Auditors'' certificate confirming compliance with the conditions of corporate governance is annexed to the Corporate Governance Report.

Business Responsibility and Sustainability Report

As recommended by the second proviso to Regulation 34(2)(f) of the Listing Regulations, the Company is pleased to voluntarily provide its maiden Business Responsibility and Sustainability Report which forms part of the Integrated Report.

Corporate Social Responsibility (CSR)

CSR activities of the Company are carried out through Lupin Human Welfare & Research Foundation (LHWRF) and Lupin Foundation.

LHWRF, which has experience of over three decades in implementing social projects, undertakes rural development activities. As a leader in undertaking CSR work in rural India, LHWRF focuses on producing efficient, sustainable and replicable models. It operates within a framework of Lives and Livelihoods, where Lives denote healthcare and Livelihoods entails rural incomes. Over the years, LHWRF has lifted many families out of poverty by imparting skills and generating farm/farm-allied/ non-farm livelihoods.

• Outreach

LHWRF operates through its 20 centres in the states of Rajasthan, Maharashtra,

Madhya Pradesh, Uttarakhand, Goa, Gujarat, Jammu, Andhra Pradesh and Sikkim. During the year, LHWRF covered 2285 villages located in 71 blocks of 21 districts in the said states.

• Programmes

In the current fiscal, LHWRF implemented various programmes having high and sustainable impact which benefited over 746000 families. Adopting a holistic rural development approach, targeted measures were implemented to enhance income and living conditions in rural India. Interventions aimed at economic, social, infrastructure development and natural resource management in operational areas broadly covered: -

• Economic development - Agriculture development programmes, animal husbandry and livelihood promotion through skill development;

• Social development - Women empowerment, health and education;

• Natural resource management - Achieving sustainable development through watershed lines, increasing water availability and accessibility, increasing land productivity, community participation, capacity building of community and comprehensive end-to-end support; and

• Infrastructure development - Building civic infrastructure, motivating people to create common assets and developing tourist spots.

Pursuant to the provisions of Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Company was required to be spend '' 334.8 million during FY22, towards CSR activities. The actual spend was '' 339.9 million.

The CSR Policy, approved by the Board of Directors, has been hosted on the Company''s website

www.lupin.com. Details of CSR activities undertaken by the Company are given in Annexure ''B’ to this Report.

Directors’ Responsibility Statement

In compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Act, to the best of their knowledge and belief your directors confirm that: -

i) in the preparation of the annual financial statements for the year ended March 31, 2022, the applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) they had 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 at the end of the financial year March 31, 2022 and of the loss of your Company for that year;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and

for preventing and detecting fraud and other irregularities;

iv) the annual financial statements have been prepared on a going concern basis;

v) they had laid down proper internal financial controls and that the same are adequate and were operating effectively; and

vi) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Directors

In accordance with the provisions of Section 152 of the Act, Ms. Vinita Gupta (DIN: 00058631), Chief Executive Officer of the Company, retires by rotation at the ensuing Annual General Meeting (AGM) and is eligible for re-appointment.

Ms. Vinita Gupta is a pharmacy graduate from the University of Mumbai and an MBA from the Kellogg School of Management at Northwestern University. She has been instrumental in formulating and executing the strategy that helped the Company to emerge as a global pharmaceutical powerhouse. Ms. Gupta has led the Company''s global expansion through a combination of organic growth and strategic acquisitions. She is also a member of the Global Advisory Board at the Kellogg School of Management. Ms. Gupta has been conferred with

various coveted global awards in recognition of her contribution to pharma business and was named amongst 20 most Influential women in healthcare by BW Healthcare World in India for 2022.

Mr. Robert Funsten (DIN: 08950420), Independent Director, retired on May 9, 2021, on completion of his term as Independent Director of the Company. The Board sincerely appreciates and places on record its gratitude for the valuable contributions of Mr. Funsten during his association with the Company.

In compliance with the provisions of Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations, all Independent Directors have furnished declarations that they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing Regulations and that there has been no change in the circumstances affecting their status as Independent Directors of the Company.

During the year, ten Board meetings were held on April 9, 2021, May 12, 2021, June 1, 2021,

July 8, 2021, August 10, 2021, September 15, 2021, October 27, 2021, January 17, 2022, February 3,

2022 and March 17, 2022, details of which, are given in the Corporate Governance Report which forms part of the Integrated Report.

Board Evaluation

An annual performance evaluation of the Board, its Committees and of individual directors was carried out by the Board in terms of provisions of Section 134(3)(p) of the Act and Rule 8(4) of the Companies (Accounts) Rules, 2014. In compliance with Regulation 17(10) of the Listing Regulations, the Board carried out performance evaluation of independent directors without the participation of the director being evaluated. In a separate meeting of independent directors, performance of non-independent directors, the Board as a whole and Chairman of the Company was evaluated. Governance, control and guidance are the key roles directors play. Performance of directors was evaluated based on monitoring corporate governance practices and introducing internationally accepted best practices to address business challenges and risks. Weightage was given to active involvement in long-term strategic planning including participation in Board and Committee meetings. Among other matters, the evaluation process focused on board dynamics, softer aspects, effectiveness of Board Committees and flow of information to the Board and its Committees. Board performance was evaluated after seeking inputs from all directors on criteria such as board composition and structure and effectiveness of board processes. Performance of

Committees was evaluated after seeking inputs from Committee members as regards composition of Committees and effectiveness of Committee meetings. Performance of individual directors was reviewed on the basis of criteria viz. contribution at Board/Committee meetings, leadership qualities, qualifications, responsibilities shouldered, analytical skills, knowledge, preparedness on the issues discussed and meaningful and constructive contributions. Parameters such as, initiative, independent judgement and understanding the business environment were also taken into account.

Audit Committee

The Audit Committee comprises three non-executive directors, i.e. Dr. Punita Kumar-Sinha, Independent Director, Chairperson, Dr. Kamal K. Sharma, Vice Chairman and Ms. Christine Mundkur, Independent Director. Mr. R. V Satam, Company Secretary, acts as the Secretary of the Committee. The functions performed by the Committee, particulars of meetings held and attendance thereat are mentioned in the Corporate Governance Report, which forms part of the Integrated Report. All recommendations made by the Audit Committee were accepted by the Board.

Nomination and Remuneration Policy

As recommended by the Nomination and Remuneration Committee and as stipulated by Section 178(3) of the Act and Regulation 19(4) of the Listing Regulations, the Board formulated a Nomination and Remuneration Policy. The policy covers remuneration of directors, key managerial personnel and senior management and also lays down guiding principles, philosophy and basis for recommending payment of their remuneration.

The policy includes criteria for determining qualifications, positive attributes and independence of directors. In terms of the policy, the Committee evaluates balance of skills, knowledge and experience of Independent Directors, whom it recommends to the Board for appointment. The functions of the Committee are mentioned in the Corporate Governance Report, which forms part of the Integrated Report. In terms of proviso to Section 178(4) of the Act, the policy has been hosted on the Company''s website www.lupin.com (web link: https:// www.lupin.com/wp-content/uploads/2022/05/ nomination-and-remuneration-committee-terms-of-reference.pdf).

Related Party Transactions

No related party transaction entered into by the Company conflicted with the interests of the Company. All transactions entered into by the Company with related parties during the year, were in accordance with the Act and Rules made thereunder and the Listing Regulations. All such

contracts and arrangements entered into by the Company were in the ordinary course of business and on an arm''s length basis. As mandated by the Act and Listing Regulations, the Audit Committee periodically reviews and approves related party transactions. Material related party transactions were entered into by the Company only with its subsidiaries. As stipulated by Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014, disclosure of particulars of contracts/arrangements entered into by the Company with related parties are given in Form No. AOC - 2, as Annexure ''C’ to this Report. Apart from remuneration and sitting fees, there is no pecuniary transaction with any director, which had potential conflict of interest with the Company. As stipulated by Regulation 46(2)(g) of the Listing Regulations, the policy on ''Related party transactions and materiality of related party transactions'', as approved by the Board is available on the Company''s website www.lupin.com and web link for the same is https:// www.lupin.com/wp-content/uploads/2022/03/ rpt-policy-03-02-2022.pdf.

Risk Management

The Risk Management Committee constituted by the Board is compliant with Regulation 21 of the Listing Regulations as regards composition, frequency and quorum of meetings. The Board has defined the roles, responsibilities and functions of the Committee.

The Company has a structured process of reviewing overall risk canvas with a focus on critical ''risks that matter''. As a part of the risk management framework, critical risks that matter are identified and assessed for probability, impact and volatility of occurrence to set-up mitigation plans for addressing and avoiding them. The risk management framework also defines the roles and responsibilities at various levels in the Company. The Committee has a monitoring mechanism process in place wherein the overall risks are evaluated and effectiveness of mitigation plans reviewed.

Terms of reference of the Committee, details of meetings held and attendance thereat are mentioned in the Corporate Governance Report, which forms part of the Integrated Report.

Particulars of loans/guarantees/ investments/securities

Pursuant to provisions of Section 134(3)(g) of the Act, particulars of loans, guarantees, investments and securities given under Section 186 of the Act are disclosed in the notes to the financial statements forming part of the Integrated Report.


Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Pursuant to Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, information as regards conservation of energy, technology absorption and foreign exchange earnings and outgo is given in Annexure ''D’ to this Report.

Human Resources

Your Company firmly believes that human resources are invaluable assets. The Company has been consistently recognised as a ''Great Place to Work'' in the Biotechnology & Pharmaceuticals sector. People-first approach, best-in-class work environment and advanced learning initiatives of the Company were the key drivers behind these achievements.

As mandated by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has constituted an Internal Complaints Committee. Employees are regularly sensitized about matters pertaining to prevention of sexual harassment.

Employees Stock Options

In compliance with Regulation 14(B) of the SEBI (Share Based Employee Benefits) Regulations, 2014, details of stock options as on March 31, 2022, are given in Annexure ''E’ to this Report.

Vigil Mechanism/Whistleblower Policy

Your Company adheres to uncompromising integrity in conduct of its business and strictly abides by well-accepted norms of ethical, lawful and moral conduct. It has zero tolerance for any form of unethical conduct or behaviour. Directors and employees are at liberty to report unethical practices and raise their concerns to the office of the Ombudsperson without any fear of retaliation or retribution. The office of the Ombudsperson has official authority to receive, respond and investigate all offences within the scope of this policy. Teams of strategic business units heads/officers appointed by the Ombudsperson investigated/examined complaints and the same were satisfactorily resolved. No personnel has been denied access to the Chairman of the audit committee.

In compliance with the provisions of Section 177(9) and (10) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers)

Rules, 2014 and Regulation 22 of the Listing Regulations, the Company has established a Vigil mechanism/Whistleblower Policy for directors and employees to report genuine concerns. As mandated

by Regulation 18(3) read with Schedule II Part C(18) of the Listing Regulations, the Audit Committee reviews the functioning of the Vigil mechanism/ Whistleblower Policy.

During the year, the Ombudsperson received 24 complaints, mostly of minor nature. The Vigil mechanism/Whistleblower Policy is placed on the Company''s website https://www.lupin.com/ wp-content/uploads/2022/02/Whistleblower-Policy-Website.pdf.

Particulars of Employees Remuneration

Particulars of remuneration of employees to be disclosed as stipulated by Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given in Annexure ''F’ to this Report. Statement containing the said particulars, to be furnished in terms of Rules 5(2) and 5(3) of the said Rules, for the year ended March 31, 2022, forms part of this Report. The same shall be provided to Members upon written request pursuant to second proviso of Rule 5. In terms of provisions of Section 136(2) of the Act, particulars of remuneration of employees are available for inspection by Members at the Registered office of the Company during business hours on all working days up to the date of the ensuing AGM.

Auditors

The Company continues to have unqualified audit reports.

At the 39th AGM held on Tuesday, August 10, 2021, Members appointed B S R & Co. LLP, Chartered Accountants (Firm Reg. No. 101248W/W-100022), as auditors of the Company, for a period of five years from the conclusion of the 39th AGM till the conclusion of the 44th AGM.

Pursuant to the provisions of Section 141 of the Act, the Company has received a certificate from B S R & Co. LLP, certifying that their appointment is in compliance with the conditions prescribed by the said Section.

Internal Audit

Internal audit of the Company''s operations is conducted by the in-house corporate internal audit team, the strength of which is adequate to undertake audits. Audits of Carrying & Forwarding Agents and Central Warehouses of the Company in India are regularly conducted by local chartered accountant firms. Services of external auditors/specialist firms are engaged for undertaking special audit assignments. Internal audit findings are presented to the Audit Committee.

Cost Audit

Pursuant to the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014 and as recommended by the Audit Committee, the Board of Directors, at its meeting held on May 12, 2021, appointed Mr. S. D. Shenoy, practising cost accountant (FCMA No.

8318), as Cost Auditor, to conduct cost audit for the year ended March 31, 2022. Mr. Shenoy is a Cost Accountant as defined under Section 2(1)(b) of the Cost and Works Accountant Act, 1959 and holds a valid certificate of practice. Mr. Shenoy has confirmed that he is free from the disqualifications specified in Section 141 read with Sections 139 and 148 of the Act and that his appointment meets the requirements prescribed in Sections 141(3)(g) and 148 of the Act. Mr. Shenoy also confirmed that he was independent, maintained an arm''s length relationship with the Company and that no orders or proceedings were pending against him relating to matters of professional conduct before the Institute of Cost Accountants of India or any competent court/authority.

In compliance with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the Members, at the 39th AGM held on August 11, 2021, ratified (vide an ordinary resolution), the remuneration payable to Mr. Shenoy, for conducting cost audit for the year ended March 31, 2022.

The Company has maintained cost records as specified by the Central Government under Section 148(1) of the Act.

In accordance with Section 148(6) of the Act read with Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014, cost audit report, in Form No. CRA-4 (in XBRL mode), for the year ended March 31, 2021, was filed with the Ministry of Corporate Affairs, within the prescribed time.

Secretarial Audit

In compliance with Section 204 of the Act read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of the Listing Regulations, the Board of Directors, at its meeting held on May 12, 2021, appointed Ms. Neena Bhatia, practising company secretary (FCS No. 9492 CP. No. 2661), to undertake Secretarial Audit of the Company for the year ended March 31, 2022. Secretarial Audit Report in the prescribed Form No. MR-3 is enclosed as Annexures ''G’ and ''G-1’ to this Report. The Company continues to have an unqualified Report.

Annual Secretarial Compliance Report

In compliance with Regulation 24A(2) of the Listing Regulations, the Board of Directors, at its meeting held on May 12, 2021, appointed Ms. Neena Bhatia, practising company secretary (FCS No. 9492 CP.

No. 2661), for issuing Annual Secretarial Compliance Report for the year ended March 31, 2022.

The Report, presented at the Board Meeting held on May 18, 2022, confirmed that the Company has maintained proper records as stipulated under various Rules and Regulations and that, no action has been taken against the Company or its material subsidiaries or promoters/directors by SEBI/BSE/ NSE. The Company disseminated the Report on the websites of BSE and NSE within the prescribed time.

Compliance with Secretarial Standards

The Company complies with Secretarial Standards on Board Meetings (SS-1) and General Meetings (SS-2) (including amendments thereto) issued by the Institute of Company Secretaries of India


Annual Return

Pursuant to provisions of Sections 92(3) and 134(3)(a) of the Act, the Annual Return of the Company for the year ended March 31, 2022, has been hosted on the Company''s website www.lupin.com and web link for the same is https^www.lupin.com/investors/ reports-filings/.

Acknowledgements

Your directors sincerely appreciate all employees of the Company for their contribution, commitment, dedication and hard work. The Board also expresses its deep gratitude and looks forward to the continued support of the Central/State governments, local bodies/associations, banks, financial institutions, stakeholders, business associates, medical professionals and analysts.

For and on behalf of the Board of Directors

Manju D. Gupta Chairman

(DIN: 00209461)

Mumbai, May 18, 2022


Mar 31, 2021

Your Directors have pleasure in presenting their report on business and operations of your Company for the year ended March 31, 2021.

Financial Results

('' in million)

Standalone

Consolidated

2020-21

2019-20

2020-21

2019-20

Revenue from Operations

110559.3

110256.6

151629.6

153747.6

Other Income

1290.9

4751.9

1362.9

4837.6

Profit before interest, depreciation and tax

21731.5

23828.0

27031.7

28385.6

Less: Finance Costs

406.2

525.9

1406.4

3629.8

Less: Depreciation, amortisation and impairment expenses

5028.3

5187.5

8874.1

9702.2

Profit before share of Profit from Jointly Controlled Entity, exceptional items and Tax

16297.0

18114.6

16751.2

15053.6

Add: Share of Profit from Jointly Controlled Entity

-

-

13.3

39.4

Less: Exceptional Items

-

7592.1

-

7520.7

Less: Provision for taxation (including deferred tax)

3710.8

3247.0

4485.2

11571.1

Profit/(Loss) after tax from continuing operations

12586.2

7275.5

12279.3

(3998.8)

Profit/(Loss) after tax from discontinued operations

-

-

-

1301.0

Profit/(Loss) after tax and before non-controlling interest

12586.2

7275.5

12279.3

(2697.8)

Share of Profit/(Loss)attributable to Non-controlling Interest

-

-

114.0

(3.9)

Net Profit/(Loss) attributable to Shareholders of the Company

12586.2

7275.5

12165.3

(2693.9)

Performance Review

Consolidated Revenue from Operations for the year ended March 31, 2021 was '' 151629.6 million. International business contributed 65%. Consolidated profit before exceptional items and tax was '' 16751.2 million, higher by 11.3% over FY 2019 - 20. Net Profit after exceptional items and tax was '' 12165.3 million, as against loss of '' 2693.9 million in FY 2019 - 20. Earnings per share (Basic) stood at '' 26.84.

COVID-19 Pandemic

The World Health Organization declared COVID-19 to be a pandemic. The Company adopted measures to curb the spread of infection in order to protect the health of its employees and ensure business continuity with minimal disruptions including remote working, maintaining social distancing, sanitization of workspaces etc. The Company considered internal and external information while finalizing various estimates in relation to its financial statements up to the date of their approval by the Board of Directors and has not identified any material impact on the carrying value of assets, inventories, receivables, borrowings, liabilities or provisions.

Since the Company deals with pharmaceuticals, which is classified as essentials, there has been no

significant impact on the overall demand of the goods and its supply chain. The Company did not observe major delays in collections from customers and hence there was no significant increase in credit risk. The Company''s liquidity position is adequate to service all its near-term debts and other financing arrangements/liabilities. The actual impact of the global health pandemic may be different from that which has been estimated, as the COVID-19 situation evolves in India and globally. The Company will continue to closely monitor any material changes to future economic conditions. With a view to facilitate the upkeep of good health for its employees across India, the Company extended a medical outreach program - L I B E R A T E (Lupin''s Initiative to Bring Covid19 Education & provide Recommendations for Advocacy, testing & Treatment assistance to Employees) for those who wished to seek medical assistance during lockdown.

Dividend

Your Directors are pleased to recommend higher dividend of 325% ('' 6.50 per equity share) as against 300% ('' 6/- per equity share) of the previous year. The total dividend amount is '' 2949.2 million.

In compliance with Regulation 43A(1) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), the Dividend Distribution Policy has been hosted on the website of the Company www.lupin.com, (web link: https:// www.lupin.com/wp-content/uploads/2021/04/ dividend-distribution-policy.pdf).

Share Capital

During the year, the paid-up share capital of the Company increased by '' 1.4 million consequent to the allotment of 682012 equity shares of '' 2/-each to eligible employees of the Company and its subsidiaries on exercising options under various stock option plans. Paid-up equity share capital as on March 31, 2021 was '' 907.4 million.

Credit Rating

ICRA Limited (ICRA) continued to maintain the rating ‘A1 ’ (pronounced ''ICRA A one Plus'') for the Company''s short-term credit facilities of '' 15000 million, indicating very strong degree of safety regarding timely payment of financial obligations.

Subsidiary Companies/Joint Venture

As on March 31, 2021, the Company had 25 subsidiaries and a joint venture.

As part of restructuring, Lupin Middle East FZ-LLC, UAE and Lupin Japan & Asia Pacific K.K., Japan were liquidated, effective July 2, 2020 and December 17,

2020, respectively. Lupin GmbH, Switzerland was merged with Lupin Atlantis Holdings SA, Switzerland, effective September 21, 2020.

The Board of Directors approved the entry into diagnostic business through Lupin Healthcare Limited, wholly owned subsidiary of the Company.

As part of business expansion, Lupin Biologics Limited, India and Lupin Oncology Inc., USA were incorporated on January 28, 2021 and March 15,

2021, respectively, as wholly owned subsidiaries of the Company.

The Company''s Biotech division is based out of Pune. Lupin Biologics Limited was incorporated with a vision to produce affordable and accessible high-quality biologics for patients globally.

The Company successfully developed Biosimilar for Etanercept (Enbrel®) for global markets and has in pipeline, several projects in various phases of development which hold market potential.

With a view to have a greater focus on the Oncology pipeline, Lupin Oncology Inc., USA, was incorporated which will engage in development/co-development and commercialization of various oncology products.

Pursuant to the first proviso to Section 129(3) of the Companies Act, 2013 (Act) and Rules 5 and 8(1) of the Companies (Accounts) Rules, 2014, salient features of the financial statements, performance and financial position of each subsidiary and joint venture are given in Form No. AOC - 1 as Annexure ‘A’ to this Report. Pursuant to the provisions of Section 136 of the Act, financial statements of subsidiaries and joint venture are available for inspection by Members at the Registered Office of the Company during business hours. The Company shall provide free of cost, a copy of the financial statements of its subsidiaries and joint venture to Members upon their request. The said financial statements are also available on the Company''s website www.lupin.com.

In compliance with Regulation 46(2)(h) of the Listing Regulations, policy for determining material subsidiaries has been hosted on the Company''s website www.lupin.com (web link: https:// www.lupin.com/wp-content/uploads/2021/04/ policy-for-determining-material-subsidiaries.pdf).

Integrated Report

The Company has voluntarily provided its maiden Integrated Report encompassing financial and non-financial information, to help Members take well-informed decisions and have a better understanding of the Company''s long-term perspective. The Report inter-alia covers Company''s strategy, governance framework, performance and value creation based on the six forms of capital i.e. financial capital, human capital, manufacturing capital, social capital, intellectual capital and natural capital.

Management Discussion and Analysis

In compliance with Regulation 34(3) read with Schedule V(B) of the Listing Regulations, Management Discussion and Analysis forms part of this Integrated Report.

Corporate Governance Report

Your Directors reaffirm their continued commitment to adhere to the highest standards of Corporate Governance. In compliance with Regulation 34(3) read with Schedule V(C) of the Listing Regulations, a Report on Corporate Governance forms part of this Integrated Report. As stipulated by Schedule V(E) of the Listing Regulations, Auditors'' certificate confirming compliance with the conditions of corporate governance is annexed to the said Report.

Business Responsibility Report

In compliance with Regulation 34(2)(f) of the Listing Regulations, the Business Responsibility Report forms part of this Integrated Report.

Corporate Social Responsibility (CSR)

CSR activities are carried out through Lupin Human Welfare & Research Foundation (LHWRF) and Lupin Foundation, CSR arms of the Company. LHWRF, which undertakes rural development, has experience of implementing social projects for over three decades. LHWRF, through 20 centres, has a presence in about 5431 villages located in 77 blocks of 23 districts spread across 9 states. The Company broadly undertakes the following CSR activities: -

• Economic Development Programs;

• Social Development Programs;

• Rural Infrastructure Development Programs;

• Learn & Earn Programs;

• Natural Resource Management; and

• Disaster Relief and Mitigation.

LHWRF has done remarkable work for Covid relief and transiting migrant workers.

On January 22, 2021, the Ministry of Corporate Affairs notified Section 21 of the Companies (Amendment) Act, 2019 and Section 27 of the Companies (Amendment) Act, 2020, whereby the provisions of Section 135 of the Act were amended. In terms of the amended provisions, unless the unspent CSR amount relates to any ongoing project, the same shall be transferred to a Fund specified in Schedule VII of the Act, within six months from the end of the financial year. Pursuant to the provisions of Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, during the year, the amount required to be spent by the Company @ 2% for FY 2020-21 is '' 346.6 million. The Company spent '' 351.1 million on various CSR activities.

Details of CSR activities undertaken by the Company are given in Annexure ‘B’ to this Report. The CSR policy, which has been approved by the Board, has been hosted on the Company''s website www.lupin.com.

Directors’ Responsibility Statement

In compliance with the provisions of Section 134(3) (c) read with Section 134(5) of the Act, to the best of their knowledge and belief your Directors confirm that: -

i) in the preparation of the annual financial statements for the year ended March 31, 2021, the applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) they had 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 at the end of the financial year March 31, 2021 and of the profit of your Company for that year;

iii) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and

for preventing and detecting fraud and other irregularities;

iv) the annual financial statements have been prepared on a going concern basis;

v) they had laid down proper internal financial controls and that the same are adequate and were operating effectively; and

vi) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Directors

Pursuant to the provisions of Section 152 of the Act, Dr. Kamal K. Sharma (DIN: 00209430),

Vice Chairman, retires by rotation at the forthcoming Annual General Meeting (AGM) and is eligible for re-appointment.

Mr. R. A. Shah (DIN: 00009851), Mr. Richard Zahn (DIN: 02937226), Dr. K. U. Mada (DIN: 00011395) and Mr. Dileep C. Choksi (DIN: 00016322), Independent Directors, retired at the conclusion of the 38th Annual General Meeting held on August 12, 2020, on completion of their second terms as Independent Directors of the Company. The Board and the Management sincerely appreciates and places on record its gratitude for the significant contributions made by Mr. Shah, Mr. Zahn,

Dr. Mada and Mr. Choksi during their association with the Company.

Mr. K. B. S. Anand (DIN: 03518282) and Dr. Punita Kumar-Sinha (DIN: 05229262) were appointed as Independent Directors and designated as Additional Directors effective August 12,

2020. Mr. Robert Funsten (DIN: 08950420) and Mr. Mark D. McDade (DIN: 09037255) were appointed as Independent Directors and designated as Additional Directors effective November 10, 2020 and January 28, 2021, respectively.

Pursuant to the provisions of Sections 149 and 152 of the Act, the Members, vide Ordinary Resolutions passed through Postal Ballot, the results of which were declared on March 17, 2021, approved, the appointments of Mr. Anand and Dr. Kumar-Sinha, as Independent Directors of the Company, for a period of five years, effective August 12, 2020;

Mr. Robert Funsten, as an Independent Director of the Company, for a period of six months, effective November 10, 2020; and Mr. Mark D. McDade, as an Independent Director of the Company, for a period of five years, effective January 28, 2021.

Mr. Anand is a B. Tech (Mech. Engineering) from Indian Institute of Technology, Mumbai, and PGDM, Indian Institute of Management, Kolkata.

He is well versed with managing board dynamics.

Mr. Anand was nominated as the ''Best CEO - Private Sector'' at the Forbes Leadership Awards in 2016 and was awarded the Qimpro Gold Standard in Business for Quality in 2017.

Dr. Kumar-Sinha has a Ph.D. and Master''s in Finance from the Wharton School, University of Pennsylvania. She has an MBA and is a CFA charter holder.

Dr. Kumar-Sinha received her undergraduate degree in Chemical Engineering with distinction from the Indian Institute of Technology, New Delhi. She has focused on investment management and financial markets during her 30-year career. Dr. Kumar-Sinha has significant governance and Board experience.

Mr. Robert Funsten is Counsel in the Corporate Practice Group of the law firm Brown Rudnick LLP in the USA. He has over 25 years experience working with and advising life sciences companies in transactional, M & A and other matters. Mr. Funsten received a J.D. from Stanford Law School and a B.A., magna cum laude from the University of California, Los Angeles.

Mr. McDade is a highly accomplished executive with excellent operating and leadership skills. During a biopharmaceutical career spanning over more than 37 years, he has held a progression of COO and CEO roles in complex businesses. Mr. McDade completed B.A. in history from Dartmouth College and MBA from Harvard Business School.

At the 37th AGM held on August 7, 2019,

Ms. Christine Mundkur was appointed as an Independent Director to hold office till the conclusion of the 39th AGM. Pursuant to the provisions of Sections 149, 152 read with Schedule IV of the Act and Rules made thereunder and as recommended by the Nomination & Remuneration Committee, Ms. Mundkur is being re-appointed as an Independent Director, to hold office for a period of five years after the conclusion of the 39th AGM i.e. up to August 10, 2026. Her appointment is subject to approval by the Members vide a Special Resolution at the 39th AGM. Ms. Mundkur has consented for being appointed as an Independent Director and has confirmed that she is not disqualified from being appointed as a Director. She has also submitted

declaration as regards Independent status vis-a-vis the Company.

In compliance with the provisions of Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations, all Independent Directors have submitted declarations that they meet the criteria of independence as provided in Section 149(6) of the Act and Regulation 16(1)(b) of the Listing R e g u l ations and that there has been no change in the circumstances affecting their status as Independent Directors of the Company.

During the year, six Board meetings were held, on May 28, 2020, August 6, 2020, August 12, 2020, November 4, 2020, January 28, 2021 and March 10, 2021, the details of which, are given in the Corporate Governance Report which forms part of this Integrated Report.

Board Evaluation

Pursuant to the provisions of Section 134(3)(p) of the Act and Rule 8(4) of the Companies (Accounts) Rules, 2014, an annual performance evaluation was carried out by the Board of its own performance, Directors individually and Committees of the Board. Performance evaluation of the Board and Committees was done by the Board after seeking inputs from all Directors, inter-alia covering different criteria, viz. adequacy and composition of the Board, quality of deliberations, transparency, effectiveness of Board procedures, observance of governance and contributions of Directors at Board and Committee meetings. In evaluating the performance of individual Directors, criteria such as leadership qualities, qualifications, responsibilities shouldered, analytical skills, knowledge, participation in long-term strategic planning, inter-personal relationships and attendance at meetings was taken into consideration.

In compliance with Regulation 17(10) of the Listing Regulations, the Board carried out performance evaluation of Independent Directors without the participation of the Director being evaluated.

The performance evaluation was carried out based on parameters such as, initiative, contributions, independent judgement, understanding the business environment and understanding of strategic issues. Independent Directors are a diversified group of recognised professionals with wide horizon of knowledge, competence and integrity, who express their opinions freely and exercise their own judgements in decision-making. Overseas Independent Directors have international perspectives and bring them to bear upon during Board deliberations. There is no conflict of interest of Independent Directors with the Company.

Audit Committee

Up to August 12, 2020, the Audit Committee comprised three non-executive directors, i.e.

Dr. K. U. Mada, Independent Director, Chairman,

Dr. Kamal K. Sharma, Vice Chairman and Mr. Dileep C. Choksi, Independent Director. Dr. Mada and Mr. Choksi, retired at the conclusion of the 38th AGM, on completion of their second terms as Independent Directors of the Company.

Effective August 25, 2020, the Audit Committee was reconstituted and comprises Dr. Punita Kumar-Sinha, Independent Director, Chairperson, Dr. Kamal K. Sharma and Ms. Christine Mundkur, Independent Director. Mr. R. V. Satam, Company Secretary, acts as the Secretary of the Committee. The functions performed by the Audit Committee, particulars of meetings held and attendance thereat are mentioned in the Corporate Governance Report, which forms part of this Integrated Report. All recommendations made by the Audit Committee were accepted by the Board.

Nomination and Remuneration Policy

In compliance with Section 178(3) of the Act and Regulation 19(4) of the Listing Regulations, on the recommendation of the Nomination and Remuneration Committee, the Board formulated a Policy relating to the remuneration of Directors,

Key Managerial Personnel and Senior Management. The policy lays down the guiding principles, philosophy and basis for recommending payment of remuneration to the executive/non-executive Directors. It includes criteria for determining qualifications, positive attributes and independence of directors and other matters. The functions of the Committee are disclosed in the Corporate Governance Report, which forms part of the Integrated Report. In terms of proviso to Section 178(4) of the Act, the Nomination and Remuneration Policy has been hosted on the Company''s website www.lupin.com, (web link: https://www.lupin.com/ wp-content/uploads/2021/04/nomination-and-remuneration-policy-ll-final.pdf).

Related Party Transactions

All transactions entered by the Company with related parties during the financial year, were in the ordinary course of business and on an arm''s length basis.

No related party transaction was in conflict with the interests of the Company. The Audit Committee periodically reviews and approves related party transactions. Material related party transactions were entered into by the Company only with its subsidiaries. As stipulated by Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014, disclosure of particulars of contracts/ arrangements entered into by the Company with

related parties are given in Form No. AOC - 2, as Annexure ‘C’ to this Report. Apart from remuneration, sitting fees and commission, there is no pecuniary transaction with any Director, which had potential conflict of interest with the Company. As stipulated by Regulation 46(2)(g) of the Listing Regulations, the policy on dealing with related party transactions, as approved by the Board, has been hosted on the Company''s website www.lupin.com and web link for the same is https://www.lupin.com/wp-content/ uploads/2021/04/policy-related-party-transactions. pdf.

Risk Management

In compliance with Regulation 21 of the Listing Regulations, Risk Management Committee comprising Dr. Kamal K. Sharma, Vice Chairman, Ms. Vinita Gupta, Chief Executive Officer, Mr. Nilesh D. Gupta, Managing Director,

Mr. Ramesh Swaminathan, Executive Director,

Global CFO and Head Corporate Affairs and Mr. Sunil Makharia, President - Finance, has been constituted. The Company has in place a Risk Management framework which defines the roles and responsibilities at various levels in the organization. The ongoing review process in line with the framework helps in identifying the critical ''risks that matter'' and focusing on emerging risks in the business environment. The Committee ensures that there is a robust process of identifying key risks based on the probability of occurrence, its potential business and financial impact and volatility along with focus on arriving at mitigation plans and its implementation. Constitution of the Committee, its terms of reference, details of meeting held and attendance thereat are mentioned in the Corporate Governance Report, which forms part of the Integrated Report. The Company was awarded ''Masters of Risk in Pharma & Healthcare'' category at India Risk Management Awards 7th Edition by CNBC-TV18.

Particulars of loans/guarantees/ investments/securities

In compliance with the provisions of Section 134(3)(g) of the Act, particulars of loans, guarantees, investments and securities given under Section 186 of the Act are given in the notes to the Financial Statements forming part of this Integrated Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

As stipulated by Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules,

2014, particulars pertaining to conservation of energy, technology absorption and foreign exchange earnings and outgo, are given in Annexure ‘D’ to this Report.

Human Resources

The Company considers human resources as invaluable assets. The Company has had the honor of being consistently recognised as ''Great Place to Work''. The Company was ranked No. 1 in the Biotech and Pharma and amongst Top 50 large organisations in the list of top 100 - Great Place to Work™ for 2019-20. The Company''s people-first approach, providing best-in-class work environment and advanced learning initiatives were the key drivers behind these achievements.

As mandated by the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, the Company has constituted an Internal Complaints Committee. Employees are regularly sensitized about matters pertaining to prevention of sexual harassment.

Employees Stock Options

Pursuant to the provisions of Regulation 14(B) of the SEBI (Share Based Employee Benefits) Regulations, 2014, details of stock options as on March 31, 2021, are given in Annexure ‘E’ to this Report.

Vigil Mechanism/Whistleblower Policy

Over the years, the Company established a strong reputation for doing business with integrity and has displayed zero tolerance for any form of unethical conduct or behaviour. In compliance with the provisions of Section 177(9) and (10) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the Listing Regulations, the Company has established a Vigil mechanism/Whistleblower Policy for Directors and employees to report genuine concerns. As mandated by Regulation 18(3) read with Schedule II Part C(18) of the Listing Regulations, the Audit Committee reviews the functioning of the Vigil mechanism/Whistleblower Policy. The Company adheres to uncompromising integrity in conduct of its business and strictly abides by well-accepted norms of ethical, lawful and moral conduct. Employees are at liberty to report unethical practices and raise their concerns to the office of the Ombudsperson without any fear of retaliation or retribution. Complaints, including anonymous ones are investigated/examined by teams of strategic business units heads/officers appointed by the Ombudsperson and are swiftly redressed. During the year, the Ombudsperson received 21 complaints which were investigated and dealt with according to the Ombudsperson Policy and no complaints were pending. Vigil mechanism/Whistleblower Policy is hosted on the website of the Company www.lupin.com. Policies on Code of Conduct and Prevention of Sexual Harassment are on the internal portal of the Company.

Particulars of Employees Remuneration

Disclosure of particulars of remuneration of employees as stipulated by Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are given in Annexure ‘F’ to this Report. Statement containing particulars of remuneration of employees for the year ended March 31, 2021 required to be furnished in terms of Rules 5(2) and 5(3) of the said Rules, forms part of this Report. The same shall be provided to Members upon written request pursuant to second proviso of Rule 5. Pursuant to provisions of Section 136(2) of the Act, particulars of remuneration of employees are available for inspection by Members at the Registered office of the Company during business hours on all working days up to the date of the forthcoming AGM.

Auditors

The Company continues to have an unqualified Audit Report.

At the 34th AGM held on Wednesday, August 3, 2016, Members appointed B S R & Co. LLP, Chartered Accountants (Firm Reg. No. 101248W/W-100022), as Statutory Auditors of the Company, for a period of five years from the conclusion of the 34th AGM till the conclusion of the 39th AGM.

As recommended by the Audit Committee, the Board of Directors approved the re-appointment of B S R & Co. LLP as Statutory Auditors of the Company, for a period of five years from the conclusion of 39th AGM till the conclusion of the 44th AGM or any adjournment thereof subject to approval of the Members at the ensuing AGM.

Pursuant to the provisions of Sections 139(1) and 141 of the Act, the Company has received a Certificate from B S R & Co. LLP, certifying that, if appointed, their appointment would be as per the conditions prescribed by the said Sections.

Internal Audit

The Corporate Internal Audit team carried out Internal audit of the Company''s operations.

The strength of the in-house Internal Audit team is adequate to undertake the audit function.

Local Chartered Accountant firms conduct audits of Carrying & Forwarding Agents and Central Warehouses of the Company in India. Internal audit findings are discussed at presentations made at the Audit Committee meetings and corrective actions taken.

Cost Audit

In compliance with the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014 and as recommended by the Audit Committee, the Board of Directors at its meeting held on May 28,

2020, appointed Mr. S. D. Shenoy, Practising Cost Accountant (FCMA No. 8318), as Cost Auditor to conduct cost audit for the year ended March 31,

2021. Mr. Shenoy is a Cost accountant as defined under Section 2(1)(b) of the Cost and Works Accountant Act, 1959 and holds a valid certificate of practice. Mr. Shenoy confirmed that he was free from disqualifications as specified under Section 141 read with Sections 139 and 148 of the Act and that his appointment met the requirements of Sections 141(3)(g) and 148 of the Act. Mr. Shenoy also confirmed that he was independent, maintained an arm''s length relationship with the Company and that no orders or proceedings were pending against him relating to professional matters of conduct before the Institute of Cost Accountants of India or any competent authority/court.

In compliance with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, remuneration payable to Mr. Shenoy, for conducting Cost Audit for the year ended March 31, 2021, was ratified by Members, by passing an Ordinary Resolution at the 38th AGM held on August 12, 2020.

The Company has maintained cost records as specified by the Central Government under Section 148(1) of the Act.

As stipulated by Section 148(6) of the Act read with Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014, Cost Audit Report, in Form No. CRA-4 (XBRL mode), for the year ended March 31, 2020, under the head ''Drugs and Pharmaceuticals'' was filed with the Central Government on December 16, 2020, well within the prescribed time.

Secretarial Audit

As stipulated by Section 204 of the Act read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A of the Listing Regulations, the Board of Directors, at its meeting held on May 28, 2020, appointed Ms. Neena Bhatia, Practising Company Secretary (FCS No. 9492 CP. No. 2661) to undertake Secretarial Audit of the Company for the year ended March 31, 2021. Secretarial Audit Report in prescribed Form No. MR-3 is enclosed as Annexures ‘G’ and ‘G’-1 to this Report. The Company continues to have an unqualified Secretarial Audit Report.

Annual Secretarial Compliance Report

In compliance with Circular No. CIR/CFD/ CMD/1/27/2019 dated February 8, 2019, issued by the Securities and Exchange Board of India, the Board of Directors, at its meeting held on May 28,

2020, appointed Ms. Neena Bhatia, Practising Company Secretary (FCS No. 9492 CP. No. 2661), for issuing Annual Secretarial Compliance Report for the year ended March 31, 2021. The Report, which was presented at the Board Meeting held on May 12,

2021, confirmed that the Company has maintained proper records as stipulated under various Rules and Regulations and that, no action has been taken against the Company or its material subsidiaries or promoters/directors by SEBI/BSE/NSE.

The Company disseminated the Report on the websites of BSE and NSE.

Compliance with Secretarial Standards

The Company continues to comply with Secretarial Standards on Board Meetings (SS-1) and General Meetings (SS-2), issued by the Institute of Company Secretaries of India.

Annual Return

In compliance with the provisions of Sections 92(3) and 134(3)(a) of the Act, the Annual Return of the Company for the financial year ended March 31,

2021 has been hosted on the Company''s website www.lupin.com and web link for the same is: https://www.lupin.com/investors/reports-filings/.

Acknowledgements

Your Directors mourn the loss of lives due to COVID-19 pandemic and are deeply grateful and with immense respect, convey their sincere appreciation to all employees of the Company for their excellent commitment, dedication, contribution and hard work. They also acknowledge and express their deep gratitude for the whole-hearted support received by the Company from various departments of the Central and State governments, banks, financial institutions, suppliers, distributors, customers, business associates, medical professionals, analysts and members.

For and on behalf of the Board of Directors

Manju D. Gupta Chairman

(DIN: 00209461)

Mumbai, May 12, 2021


Mar 31, 2018

To the Members

The Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2018.

Financial Results

(Rs. in million)

Standalone

Consolidated

2017-18

2016-17

2017-18

2016-17

Sales

98539.0

123980.8

155598.4

171198.0

Profit before interest, depreciation and tax

22169.8

45745.9

32978.6

45996.5

Less: Finance Costs

332.4

294.2

2043.5

1525.3

Less: Depreciation and amortisation

3898.1

3661.1

10858.7

9122.3

Profit before share of profit from Jointly Controlled Entity and exceptional items

17939.3

41790.6

20076.4

35348.9

Add: Share of Profit from Jointly Controlled Entity

-

-

35.2

82.5

Less: Exceptional Items (Impairment of intangible assets)

-

-

14643.5

-

Less: Provision for taxation (including deferred tax)

4492.7

10377.3

2884.6

9785.1

Profit after tax and before non-controlling interest

13446.6

31413.3

2583.5

25646.3

Less: Non-controlling Interest

-

-

70.9

71.7

Net Profit attributable to shareholders of the Company

13446.6

31413.3

2512.6

25574.6

Performance Review

Consolidated sales for the year ended March 31, 2018 were Rs.155598.4 million. International business contributes 71%. Consolidated profit before interest, depreciation & amortisation, exceptional item and tax was Rs.32978.6 million as against Rs.45996.5 million of the previous year mainly on account of lower sales and margins in the USA. Net profit for the year after exceptional item (impairment of certain intangible assets) was Rs.2512.6 million.

Impairment provision

On March 8, 2016, the Company, through its wholly-owned subsidiary, Lupin Inc., USA, acquired Gavis Pharmaceuticals, LLC, USA, Novel Laboratories, Inc., USA, VGS Holdings, Inc., USA, Edison Therapeutics, LLC, USA and Novel Clinical Research (India) Private Limited, India (collectively ‘Gavis’), for a consideration of USD 892 million. The consideration paid was allocated between IPs for current marketed products, ANDAs filed, products under R&D, fixed assets, working capital and goodwill on acquisition. Significant pressure in the US generic pricing, particularly in the opioid space (large part of Gavis portfolio), resulted in impairment on certain intangible assets acquired as a part of Gavis acquisition. Each product in the Gavis portfolio was tested for its fair value factoring the current and expected market conditions by comparing the carrying value in the books with the value in use. The fair value was determined by an independent external valuer after taking into consideration parameters like sales growth, weighted average cost of capital, terminal growth rate etc. In line with conservative accounting principles, an impairment provision of USD 227.2 million (Rs.14643 million) was made on certain intangible assets of Gavis portfolio. Deferred tax for the year ended March 31, 2018 includes deferred tax assets of Rs.3223 million created on the difference between tax and book value of certain intangible assets of Gavis portfolio.

Dividend

Your Directors are pleased to recommend dividend at Rs.5/- per equity share of Rs.2/- each, absorbing an amount of Rs.2260.5 million. Corporate tax on proposed dividend is Rs.464.7 million.

As stipulated by Regulation 43A(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’), the Dividend Distribution Policy has been hosted on the website of the Company www.lupin.com, (web link: http://www.lupin.com/pdf/16/08/policy-for-dividend-distribution.pdf).

Share Capital

During the year, the paid-up equity share capital of the Company rose by Rs.1 million consequent to the allotment of 505,981 equity shares of Rs.2/- each to eligible employees of the Company and its subsidiaries on exercising stock options under ‘Lupin Employees Stock Option Plan 2003’, ‘Lupin Employees Stock Option Plan 2005’, ‘Lupin Employees Stock Option Plan 2011’, ‘Lupin Employees Stock Option Plan 2014, ‘Lupin Subsidiary Companies Employees Stock Option Plan 2005’ and ‘Lupin Subsidiary Companies Employees Stock Option Plan 2011’. Paid-up equity share capital as on March 31, 2018 was Rs.904.2 million.

Credit Rating

ICRA Limited (ICRA) assigned the rating ‘ICRA A1 ’ (pronounced ‘ICRA A one Plus’) for the Company’s short-term credit facilities of Rs.13100 million, indicating very strong degree of safety regarding timely payment of financial obligations and ‘ICRA AAA’ (pronounced ‘ICRA triple A’) for long-term credit facilities of Rs.1900 million, indicating highest degree of safety regarding timely servicing of financial obligations. The outlook on the long-term rating is ‘Stable’.

ICRA assigned the rating ‘ICRA AAA’ to the Company’s Non-Convertible Debenture programme of Rs.1000 million, indicating highest degree of safety regarding timely servicing of financial obligations. The outlook on the rating is ‘Stable’.

Goods and Services Tax (GST)

GST, which was implemented on July 1, 2017 as ‘one nation one tax’, is an all pervasive event. It has comprehensively impacted consumption of all goods and services, triggering a colossal change in the way business dealings take place. GST, which is still evolving, provides an opportunity to reset the way business transactions could be optimized for efficiency in cost and quality. Due to its multifaceted impact, GST has become an important factor in competitive businesses environment.

GST on API and Formulations is 18% and 12% respectively. While the headline indirect tax rate on API/Bulk drugs remains constant, the rate increased from 10.5% to 12% on Formulations. However, the increase in headline tax is likely to be offset by the tax efficiencies that may accrue on procurements.

Your Company is geared to deal with the challenges thrown up as a result of numerous amendments made by the Government viz: implementation of E-Way Bill system, matching credit concepts, anti-profiteering provisions, etc.

Acquisitions

During the year, the Company through its US subsidiary, Lupin Inc., acquired Symbiomix Therapeutics, LLC. The acquisition of Symbiomix and its Solosec™ franchise significantly expands your Company’s branded women health specialty business.

Subsidiary Companies/Joint Venture

As on March 31, 2018, the Company had 33 subsidiaries and a joint venture.

On February 5, 2018, Lupin Atlantis Holdings SA, Switzerland, wholly-owned subsidiary of the Company, incorporated Lupin Europe Gmbh, Germany, for holding product registrations.

An application has been made to the Registrar of Companies, Bangalore, for removal of the name of Novel Clinical Research (India) Pvt. Ltd., wholly-owned subsidiary of the Company, from the Register of Companies w.e.f. March 27, 2018 and Order pursuant to the said application is awaited.

Pursuant to the first proviso to Section 129(3) of the Companies Act, 2013 (‘Act’) and Rules 5 and 8(1) of the Companies (Accounts) Rules, 2014, salient features of the financial statements, performance and financial position of each subsidiary and joint venture are given in Form No. AOC - 1 as Annexure ‘A’ to this Report.

As stipulated by Regulation 46(2)(h) of the Listing Regulations, the policy for determining material subsidiaries has been hosted on the Company’s website www.lupin.com (web link: http://www.lupin.com/pdf/Policy_for_determining_material_ subsidiaries.pdf).

Management Discussion and Analysis

As stipulated by Regulation 34(3) read with Schedule V(B) of the Listing Regulations, Management Discussion and Analysis forms part of this Annual Report.

Corporate Governance

As stipulated by Regulation 34(3) read with Schedule V(C) of the Listing Regulations, Corporate Governance Report forms part of this Annual Report. Annexed to the said Report is the Auditors’ certificate as prescribed under Schedule V(E) of the Listing Regulations certifying compliance with the conditions of corporate governance.

Business Responsibility Report

As stipulated by Regulation 34(2)(f) of the Listing Regulations, the Business Responsibility Report forms part of this Annual Report.

Corporate Social Responsibility (CSR)

In dedication of high moral values, Lupin Human Welfare and Research Foundation (LHWRF), the CSR arm of the Company, has been undertaking social responsibility activities since 1988. LHWRF forges knowledge partnerships with domain experts and reputed academic and technical institutes like IITs, to develop and deploy appropriate technologies to the rural poor. LHWRF mobilizes resources from banks and government to achieve high impact in its chosen geographic area of operations. LHWRF which operates across 18 centers has touched lives of more than 2.5 million residing in more than 4171 villages located in 62 blocks of 22 districts.

LHWRF carried out GRI 4 sustainability reporting process and it is first corporate foundation to do so in India. LHWRF possesses elaborate and well-set implementation mechanism at grass-root level and creates replicable and ever-evolving models for sustainable rural development for uplifting families living below the poverty line with a view to transform rural lives and improve Human Development Indices. LHWRF adopts a holistic development approach and focuses on rural development programmes which help promote equitable economic and social development.

Pursuant to the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Company ought to have spent Rs.750.5 million on CSR activities during the year. The actual spend was Rs.216.8 million. The Company undertakes the following CSR activities: -

- Economic Development;

- Social Development;

- Natural Resource Management;

- Rural Infrastructure Development;

- Learn and Earn Programme; and

- TB Eradication.

The Company plans to accelerate its CSR spend by setting-up a state-of-the-art JCI and NABH accredited hospital through ‘Lupin Foundation’, a charitable trust, set up by the Company. The proposed hospital would offer a wide mix of therapies which shall entail huge investment in land, infrastructure, medical equipments/instruments, over the next few years. The Company has also engaged services of a reputed consultancy firm for conducting preliminary feasibility study. The Company is in the process of identifying the right opportunity and is looking out for a suitable plot in Mumbai for settingup a hospital. The Company has explored eight sites in Mumbai, keeping in mind strategic location, accessibility, presence of major hospitals/nursing homes and diagnostic/pathology centers in the vicinity, etc. While some plots were narrow or too small, others were reserved in the Development Plan or were encroached upon or had disputed titles.

In the course of business, the Company spent on a number of social causes which strictly may not qualify as CSR activities viz., ‘Punarjyoti’ (‘Rebirth of Eyes’), campaign which promotes the noble message of eye donation after death, ‘Respiratory Clinics’ to increase awareness of respiratory diseases, ‘Focused Learning in lnterventional Pulmonology’ programmes for doctors, multilingual website ‘Right2breathe’ to educate patients about Asthma and Allergies. With a view to provide affordable medicines to the common man, the Company consistently spends large amounts on Research & Development which, though, is for a social cause, does not qualify as a CSR activity.

Particulars of CSR activities undertaken by the Company are given in Annexure ‘B’ to this Report. The CSR policy as approved by the Board has been hosted on the Company’s website www.lupin.com.

Directors’ Responsibility Statement

In compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Act, your Directors confirm: -

i) that in the preparation of the annual financial statements for the year ended March 31, 2018, the applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) that they had 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 at the end of the financial year March 31, 2018 and of the profit of your Company for that year;

iii) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) that the annual financial statements have been prepared on a going concern basis;

v) that they had laid down proper internal financial controls and that the same are adequate and were operating effectively; and

vi) that they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Directors

The Board places on record the invaluable contributions of Late Dr. Desh Bandhu Gupta, Founder & Chairman of the Lupin group and doyen of the Indian Pharma Industry who passed away on June 26, 2017. The exemplary vision and perseverance of Dr. Gupta helped the Company to become one of the most admired organisations. The Board appointed Mrs. Manju D. Gupta as Non-Executive Chairman of the Company, for a period of two years, effective August 11, 2017 considering her wide experience, moderating influence and quiet demeanor.

As recommended by the Nomination and Remuneration Committee, the Board, at its meeting held on May 15, 2018, re-appointed Mr. Nilesh Deshbandhu Gupta, Managing Director, for a period of five years, effective September 1, 2018, subject to approval of the Members. Mr. Gupta has been responsible for transforming the Company’s research programme and expanding its manufacturing operations as also instrumental in formulating and executing the core strategy that helped the Company to emerge as a global specialty pharmaceutical major.

Pursuant to the provisions of Section 152 of the Act, Mr. Ramesh Swaminathan, Chief Financial Officer & Executive Director, retires by rotation at the forthcoming Annual General Meeting (AGM) and is eligible for re-appointment.

Pursuant to the provisions of Section 149(7) of the Act, the Independent Directors have affirmed that they meet the criteria of independence prescribed by Section 149(6) of the Act.

During the year, six Board meetings were held, on May 23, 2017, May 24, 2017, August 2, 2017, August 11, 2017, October 30, 2017 and February 6, 2018, the details of which are given in the Corporate Governance Report which forms part of this Annual Report.

Board Evaluation

Pursuant to the provisions of Section 134(3)(p) of the Act read with Rule 8(4) of the Companies (Accounts) Rules, 2014, an annual evaluation was carried out by the Board of its own performance as also of its Committees and individual Directors. The evaluation was done by the Board after seeking inputs from all Directors, inter-alia covering different aspects viz. composition and structure of the Board, attendance including participation of the Directors at the Board and Committee meetings, observance of governance, quality of deliberations and effectiveness of the procedures adopted by the Board. In evaluating the performance of individual Directors, criteria such as qualifications, knowledge, attendance at meetings and participation in long-term strategic planning, leadership qualities, responsibilities shouldered, inter-personal relationships and analytical decision making ability were taken into consideration. In compliance with Regulation 17(10) of the Listing Regulations, the Board carried out performance evaluation of Independent Directors without the participation of the Director being evaluated.

Audit Committee

In compliance with the provisions of Section 177(8) of the Act and Regulation 18 of the Listing Regulations, the Audit Committee comprises Dr. K. U. Mada, Chairman and Mr. Dileep C. Choksi, Independent Directors and Dr. Kamal K. Sharma, Vice Chairman. The functions performed by the Audit Committee, details of meetings held and attendances thereat are given in the Corporate Governance Report, which forms part of this Annual Report. The Board has accepted all the recommendations made by the Audit Committee.

Nomination and Remuneration Policy

As stipulated by Section 178(3) of the Act and Regulation 19(4) of the Listing Regulations, the Board has, on the recommendation of the Nomination and Remuneration Committee, framed a Policy relating to the remuneration of Directors, key managerial personnel and other employees. The Policy includes criteria for determining qualifications, positive attributes and independence of directors and other matters. The role of the Nomination and Remuneration Committee is disclosed in the Corporate Governance Report, which forms part of this Annual Report. In terms of proviso to Section 178(4) of the Act, the Nomination and Remuneration Policy has been hosted on the Company’s website www.lupin.com (web link: http://www. lupin.com/pdf/18/05/nomination-and-remuneration-policy-ll.pdf).

Related Party Transactions

During the year, no transaction with related parties was in conflict with the interests of the Company. All transactions entered into by the Company with related parties during the financial year were in the ordinary course of business and on an arm’s length pricing basis. The Company did not enter into any transaction with its Key Managerial Personnel. Statements of transactions with related parties are periodically placed before the Audit Committee and are approved. Material related party transactions were entered into by the Company only with its subsidiaries. As stipulated by Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014, particulars of related party transactions are given in Form No. AOC - 2, as Annexure ‘C’ to this Report. In compliance with Regulation 46(2)(g) of the Listing Regulations, the policy on dealing with Related Party Transactions as approved by the Board has been hosted on the Company’s website www.lupin.com and web link for the same is http://www.lupin.com/pdf/POLICY-RELATED_PARTY_TRANSACTIONS.pdf.

Risk Management

The Company has a structured approach for handling risks. It has in place a Risk Management framework which defines roles and responsibilities at various levels. Risk Management team reviews the overall risk canvas and identifies critical ‘risks that matter’ by assessing their probability, impact and volatility. The Risk Management Committee has a well-set monitoring process of the risk environment through reviews, discussions and deliberations and it deploys concrete mitigation plans. As stipulated by Regulation 21 of the Listing Regulations, the roles and responsibilities of the Risk Management Committee has been defined by the Board. Monitoring and reviewing the risk management plan was delegated to the Committee. Particulars of the Risk Management Committee its terms of reference, the details of meeting held and attendance thereat are given in the Corporate Governance Report, which forms part of this Annual Report.

Particulars of loans/guarantees/investments/securities

In compliance with provisions of Section 134(3)(g) of the Act, particulars of loans, guarantees, investments and securities given under Section 186 of the Act are given in the notes to the Financial Statements forming part of this Annual Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Particulars as prescribed under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo, are given in Annexure ‘D’ to this Report.

Human Resources

Your Company firmly believes that human resources are invaluable assets of the Company. In the surveys jointly conducted by ‘Great Places to Work Institute’ and ‘The Economic Times’, the Company continued to be ranked high on a pan-industry basis. The Company has been ranked no. 1 in the Pharmaceutical and Biotech sector and 4th Best amongst Large Employers. The Company’s progressive ‘people practices’, deep rooted value-driven culture and employee development efforts have been the prime reasons behind these laurels.

Employees Stock Options

Pursuant to the provisions of Regulation 14(B) of SEBI (Share Based Employee Benefits) Regulations, 2014, details of stock options as on March 31, 2018 are given in Annexure ‘E’ to this Report.

Vigil Mechanism/Whistleblower Policy

As stipulated by Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the Listing Regulations, the Company has in place a vigil mechanism for Directors and employees to report concerns and provides adequate safeguards against victimization of persons who use the mechanism. The vigil mechanism provides for direct access to the Chairperson of the Audit Committee. Details of the same are covered in the Corporate Governance Report which forms part of this Annual Report. Whistleblower Policy has been hosted on Company’s website www.lupin.com. Policy on Prevention of Sexual Harassment is on Company’s Intranet.

Particulars of Employees Remuneration

As prescribed by Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, particulars of remuneration of employees required to be disclosed are given in Annexure ‘F’ to this Report. In terms of Rules 5(2) and 5(3) of the said Rules, statement containing particulars of remuneration of employees for the year ended March 31, 2018, which forms part of the Board Report shall be provided to Members upon written request pursuant to the second proviso of Rule 5. Particulars of remuneration of employees are available for inspection by Members at the Registered Office of the Company during business hours on all working days up to the date of the forthcoming AGM.

Auditors

At the 34th AGM held on Wednesday, August 3, 2016, Members appointed B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W-100022), as Statutory Auditors of the Company, for a period of five years from the conclusion of the 34th AGM till the conclusion of the 39th AGM, subject to ratification of their appointment by Members at every AGM.

Pursuant to the provisions of Section 40 of the Companies Amendment Act, 2017, which was notified on May 7, 2018, Members are not required to ratify appointment of Statutory Auditors at every AGM.

Pursuant to the provisions of Sections 139(1) and 141 of the Act, the Company has received Certificate from B S R & Co. LLP, certifying that if they are appointed as Auditors, their appointment would be as per the conditions prescribed by the said Sections.

Internal Audit

Ernst & Young LLP, Mumbai, are Internal Auditors of the Company for India operations. PricewaterhouseCoopers Private Limited are Internal Auditors of the Company for international subsidiaries. The Company has appointed local Chartered Accountants firms as Internal Auditors to conduct audits of Carrying & Forwarding Agents and Central Warehouses of the Company in India.

Cost Auditors

Pursuant to the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014 and as recommended by the Audit Committee, the Board had appointed Mr. S. D. Shenoy, practising Cost Accountant (FCMA, Membership No. 8318), holding a valid certificate of practice to conduct cost audit for the year ended March 31, 2018. Mr. Shenoy had confirmed that his appointment met the requirements of Section 141(3)(g) of the Act and that he was free from disqualifications as specified under Section 141 read with Section 148 of the Act. He had further confirmed that he was independent, maintained an arm’s length relationship with the Company and that no orders were pending against him relating to professional matters of conduct before the Institute of Cost Accountants of India or any court/competent authority.

In terms of Rule 14 of the Companies (Audit and Auditors) Rules, 2014, remuneration payable to the Cost Auditor is required to be ratified by Members. Accordingly, an Ordinary Resolution was passed by Members at the 35th AGM, approving the remuneration payable to Mr. Shenoy.

In compliance with Section 148(6) of the Act and Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014, Cost Audit Report, in Form CRA - 4 (XBRL mode), for the year ended March 31, 2017, under the head ‘Drugs and Pharmaceuticals’ was filed with the Central Government on October 18, 2017, well within the prescribed time.

Secretarial Audit

In terms of the provisions of Section 204 of the Act and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Ms. Neena Bhatia, Company Secretary in Practice, was appointed to undertake Secretarial Audit of the Company for the year ended March 31, 2018. Secretarial Audit Report in prescribed Form No. MR - 3 is enclosed as Annexure ‘G’ to this Report. The Company continues to have an unqualified Secretarial Audit Report.

Compliance with the Secretarial Standards

The Company has complied with all the provisions of Secretarial Standards on Board Meetings and General Meetings issued by the Institute of Company Secretaries of India and approved by the Central Government.

Extract of Annual Return

In compliance with provisions of Sections 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return as on March 31, 2018, in prescribed Form No. MGT - 9 is given in Annexure ‘H’ to this Report.

Acknowledgements

Your Directors commend all employees of the Company for their continued dedication, commitment, hard work and significant contributions. They also wish to express their deep gratitude to various departments of the Central and State governments, banks, financial institutions, business associates, customers, distributors, suppliers, analysts, medical professionals and members for their whole-hearted support and cooperation.

For and on behalf of the Board of Directors

Manju D. Gupta

Chairman

(DIN: 00209461)

Mumbai, May 15, 2018


Mar 31, 2017

To the Members

The Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2017.

Financial Results

(Rs. in million)

Standalone

Consolidated

2016-17

2015-16

2016-17

2015-16

Sales

123980.8

108828.7

171198.0

137578.7

Profit before interest, depreciation and tax

45745.9

41738.5

45996.5

38705.4

Less: Interest and finance charges

294.2

241.1

1525.3

594.7

Less: Depreciation and amortisation

3661.1

3056.1

9122.3

4871.3

Profit before tax

41790.6

38441.3

35348.9

33239.4

Less: Provision for taxation (including deferred tax)

10377.3

10132.6

9785.1

10593.4

Net Profit before share of profit from Jointly Controlled Entity and non-controlling interest

31413.3

28308.7

25563.8

22646.0

Add: Share of Profit from Jointly Controlled Entity

-

-

82.5

49.0

Less: Non-controlling Interest

-

-

71.7

87.6

Net Profit attributable to shareholders of the Company

31413.3

28308.7

25574.6

22607.4

Performance Review

Your Company touched new heights in terms of sales and profits for the year ended March 31, 2017. Consolidated sales clocked Rs.171198.0 million as against Rs.137578.7 million of the previous year, higher by 24%. International business now contributes 75%. Profit before interest, depreciation and tax was higher at Rs.45996.5 million as against Rs.38705.4 million in the previous year. Profit before tax was Rs.35348.9 million. Net profit after taxes but before share of profit from Jointly Controlled Entity and non-controlling interest was Rs.25563.8 million. Net profit after share of profit from Jointly Controlled Entity and non-controlling interest was Rs.25574.6 million, higher by 13%. Earnings per share for the year was Rs.56.69.

Dividend

Your Company has a good track record of paying dividends. Continuing with this trend, Directors are pleased to recommend dividend at Rs.7.50 per equity share of Rs.2/- each, absorbing an amount of Rs.3386.8 million. Corporate tax on proposed dividend is Rs.689.5 million.

In compliance with Regulation 43A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’), the Company formulated Dividend Distribution Policy, which has been hosted on Company’s website www.lupin.com (web link: http://www.lupin.com/pdf/16/08/policy-for-dividend-distribution.pdf).

New Registered Office

With a view to promote greater efficiency and operational convenience, effective June 1, 2016, the Company shifted its Registered Office from 159, C.S.T. Road, Kalina, Santacruz (East), Mumbai - 400 098, to Kalpataru Inspire, 3rd Floor, Off Western Express Highway, Santacruz (East), Mumbai - 400 055.

Share Capital

During the year, the paid-up equity share capital of the Company rose by Rs.2.0 million consequent to the allotment of 993,900 equity shares of Rs.2/- each to eligible employees of the Company and its subsidiaries upon their exercising stock options under ‘Lupin Employees Stock Option Plan 2003’, ‘Lupin Employees Stock Option Plan 2005’, ‘Lupin Employees Stock Option Plan 2011’, ‘Lupin Employees Stock Option Plan 2014’, ‘Lupin Subsidiary Companies Employees Stock Option Plan 2005’ and ‘Lupin Subsidiary Companies Employees Stock Option Plan 2011’. Paid-up equity share capital as on March 31, 2017 was Rs.903.2 million.

Credit Rating

ICRA Limited (ICRA) assigned the rating “ICRA A1 ” (pronounced ‘ICRA A one Plus’) for the Company’s short-term credit facilities of Rs.13100 million, indicating very strong degree of safety regarding timely payment of financial obligations and “ICRA AAA” (pronounced ‘ICRA triple A’) for long-term credit facilities of Rs.1900 million, indicating highest degree of safety regarding timely servicing of financial obligations. The outlook on the long-term rating is ‘Stable’.

ICRA assigned the rating “ICRA AAA” to the Company’s Non-Convertible Debenture programme of Rs.1000 million, indicating highest degree of safety regarding timely servicing of financial obligations. The outlook on the rating is ‘Stable’.

Indian Accounting Standards (Ind AS) - IFRS Converged Standards

As notified by the Ministry of Corporate Affairs, the Company adopted Indian Accounting Standards (‘Ind AS’) with effect from April 01, 2016. Accordingly, financial statements of the Company, its subsidiaries and a joint venture were prepared with comparative data for the year ended March 31, 2016, in compliance with ‘Ind AS’.

Subsidiary Companies/Joint Venture

As on March 31, 2017, the Company had 31 subsidiaries and a joint venture.

On July 13, 2016, Lupin Atlantis Holdings SA, Switzerland (‘LAHSA’) and Lupin Holdings BV, Netherlands, wholly-owned subsidiaries of the Company jointly incorporated a distribution company viz. Lupin Ukraine LLC, Ukraine.

On December 15, 2016, LAHSA incorporated Lupin Latam, Inc., USA, to support the business initiatives of the Company’s affiliates in Latin America.

On March 13, 2017, LAHSA incorporated Lupin Japan & Asia Pacific K.K., to support the affiliates of the Company in the Asia-Pacific region, including Japan.

For administrative and operational convenience, effective February 24, 2017, VGS Holdings Inc., USA and Edison Therapeutics, LLC, USA, wholly-owned subsidiaries of the company were amalgamated with Novel Laboratories Inc., USA and Gavis Pharmaceuticals, LLC, USA, wholly-owned subsidiaries of the Company, respectively.

Pursuant to the first proviso to Section 129(3) of the Companies Act, 2013 (‘Act’) and Rules 5 and 8(1) of the Companies (Accounts) Rules, 2014, salient features of the financial statements, performance and financial position of each subsidiary and joint venture are given in Form AOC - 1 as Annexure ‘A’ to this Report.

The policy for determining material subsidiaries has been hosted on the Company’s website www.lupin.com (web link: http://www.lupin.com/pdf/Policy_for_determining_material_ subsidiaries.pdf).

Management Discussion and Analysis

In compliance with Regulation 34(3) read with Schedule V(B) of the Listing Regulations, a Management Discussion and Analysis forms part of this Annual Report.

Corporate Governance

In compliance with Regulation 34(3) read with Schedule V(C) of the Listing Regulations, a Report on Corporate Governance forms part of this Annual Report. Annexed to the Corporate Governance Report is the Auditors’ certificate certifying compliance with the conditions of corporate governance as prescribed under Schedule V(E) of the Listing Regulations.

Your Company was conferred the coveted ‘Golden Peacock Award for Excellence in Corporate Governance’ by the Institute of Directors. The Award validates the ‘Best-in-class’ Corporate Governance practices followed by the Company and reflects on the transparent dealings with all its stakeholders.

Business Responsibility Report

In compliance with Regulation 34(2)(f) of the Listing Regulations, the Business Responsibility Report forms part of this Annual Report.

Corporate Social Responsibility (CSR)

The Company is a pioneer in CSR work in rural India, committed to ethical values which go beyond just compliance. The Company has been promoting CSR activities through its CSR arm, Lupin Human Welfare and Research Foundation (LHWRF). The Company is vigorously operative in CSR activities and adopts a holistic development approach across 8 states, 21 districts and 59 blocks of India. LHWRF became the first CSR foundation in India to publish Global Reporting Initiative (GRI 4) sustainability report. It has undertaken various projects in partnership with government and semi-government agencies. Various CSR activities and initiatives implemented aimed at achieving the objective of enhancing quality of life of the disadvantaged communities.

Pursuant to the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Company ought to have spent Rs.662.5 million on CSR activities during the year. The actual spend was Rs.196.8 million. The Company undertakes the following CSR activities: -

- Economic upgradation, Social development and Natural Resource Management;

- Rural infrastructure development (including areas near the plant locations of the Company);

- Learn and Earn programme;

- Rural industry and Skill development;

- Women health, empowerment and education;

- Financial inclusion; and

- TB awareness and detection.

The Company is committed to help the poorest of the poor and the marginalised sections of the society. In this pursuit, it would be accelerating the pace of its CSR spends. In this direction, the Company has set up ‘Lupin Foundation’, a charitable trust, with the objective of undertaking deeper sustainable projects like hospitals, educational institutes, etc.

Particulars of CSR activities undertaken by the Company are given in Annexure ‘B’ to this Report. The policy on CSR as approved by the Board has been hosted on the Company’s website www.lupin.com.

Directors’ Responsibility Statement

In compliance with the provisions of Section 134(3(c) read with Section 134(5) of the Act, your Directors confirm:-

i) that in the preparation of the annual financial statements for the year ended March 31, 2017, the applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) that they had 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 at the end of the financial year March 31, 2017 and of the profit of your Company for that year;

iii) that they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) that the annual financial statements have been prepared on a going concern basis;

v) that they had laid down proper internal financial controls and that the same are adequate and were operating effectively; and

vi) that they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Directors

Pursuant to the provisions of Section 152 of the Act, Dr. Kamal K. Sharma, Vice Chairman, retires by rotation at the forthcoming Annual General Meeting (AGM) and is eligible for re-appointment.

Independent Directors hold office till the conclusion of the 38th AGM and are not liable to retire by rotation. In compliance with the provisions of Section 149(7) of the Act, Independent Directors have given declarations that they meet the criteria of independence prescribed by Section 149(6) of the Act.

During the year, six Board meetings were held on May 18, 2016, May 19, 2016, August 1, 2016, August 9, 2016, November 9, 2016 and February 9, 2017, the details of which are given in the Corporate Governance Report which forms part of the Annual Report.

Board Evaluation

In compliance with the provisions of Section 134(3)(p) of the Act read with Rule 8(4) of the Companies (Accounts) Rules, 2014, the Board carried out annual evaluation of its own performance, that of its Committees and individual directors.

The performance of the Board and its Committees was evaluated by the Board after seeking inputs from all the Directors on the basis of the criteria, such as composition and structure of the Board, quality of deliberations, effectiveness of the procedures adopted by the Board, participation at the Board and Committee meetings, governance reviews etc. Performance of individual directors was evaluated on the basis of criteria like transparency, analytical abilities, qualifications, leadership qualities, experience, participation in the long-term strategic planning and responsibilities shouldered. Pursuant to Regulation 17(10) of Listing Regulations, the Board carried out performance evaluation of Independent Directors without the participation of the director being evaluated.

Audit Committee

The Audit Committee comprises Dr. K. U. Mada, Chairman, and Mr. Dileep C. Choksi both independent directors and Dr. Kamal K. Sharma. The functions performed by the Audit Committee, particulars of meetings held and attendance thereat are given in the Corporate Governance Report which forms part of the Annual Report. All recommendations made by the Audit Committee were accepted by the Board.

Nomination and Remuneration Policy

In compliance with Section 178(3) of the Act and Regulation 19(3) of the Listing Regulations and on the recommendation of the Nomination and Remuneration Committee, the Board framed a Policy relating to the remuneration of directors, key managerial personnel and other employees. The Policy includes criteria for determining qualifications, positive attributes and independence of a director and other matters. The functions of the Nomination and Remuneration Committee are disclosed in the Corporate Governance Report, which forms part of the Annual Report.

Related Party Transactions

All related party transactions entered into by the Company during the year were on an arm’s length basis and in the ordinary course of business. During the year, no transaction was entered into by the Company with its Key Managerial Personnel. The Company did not enter into any related party transaction which was in conflict with its interest. Statements of transactions with related parties in summary form are periodically placed before the Audit Committee and are approved by the Committee. Material related party transactions were entered into by the Company only with its subsidiaries. In compliance with Section 134(3)(h) of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014, particulars of related party transactions are given in Form No. AOC-2, as Annexure ‘C’ to this Report. The policy on materiality of Related Party Transactions as also on dealing with Related Party Transactions as approved by the Board has been hosted on the Company’s website www.lupin.com (web link: http://www.lupin.com/pdf/POLICY-RELATED_PARTY_TRANSACTIONS.pdf).

Risk Management

The Risk Management framework of the Company defines roles and responsibilities for arriving at risk rating criteria for assessing risk impact, likelihood of risks and effectiveness of mitigation plans. The process includes identification of risks involved in various areas, zeroing on ‘risks that matter’, assessing mitigation plans and preparedness to face ‘risks that matter’. The Board has defined the role and responsibilities of the Risk Management Committee which was formulated in compliance with Regulation 21 of the Listing Regulations and delegated to it, monitoring and reviewing the risk management plan. Particulars of the Risk Management Committee and its terms of reference are set out in the Corporate Governance Report, which forms part of the Annual Report.

Particulars of loans/guarantees/investments/securities

Pursuant to the provisions of Section 134(3)(g) of the Act, particulars of loans, guarantees, investments and securities given under Section 186 of the Act are given in the notes to the Financial Statements forming part of the Annual Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Particulars relating to conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated in Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014, are given in Annexure ‘D’ to this Report.

Human Resources

Your Company firmly believes that human capital is its most valuable resource whose efficiency plays a key role in building a competitive business environment. In the surveys jointly conducted by ‘Great Places to Work Institute’ and ‘The Economic Times’ the Company continues to be ranked high on a pan-industry basis. The Company has been consistently ranked no. 1 or 2 in the pharmaceutical and biotech sector. It was ranked 15th best company to work for in Asia by the survey conducted by the ‘Great Places to Work Institute’. It again featured in the Golden List of India’s Top 50 companies to work for.

The Company has made it to the elite list of top 25 Best Employers and bagged the ‘AON Best Employers in India 2016’ across all sectors/industries, in the detailed study conducted by AON Hewitt, in collaboration with Business World magazine. In its pursuit to create a vibrant work culture and with a view to attract, retain and develop best available talents, the Company regularly conducts various manpower development programs across all levels as also adopts employee-friendly policies.

Employees Stock Options

Pursuant to the provisions of SEBI (Share-Based Employee Benefits) Regulations, 2014, details of stock options as on March 31, 2017 are given in Annexure ‘E’ to this Report.

Vigil Mechanism/Whistleblower Policy

In compliance with the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the Listing Regulations, the Company formulated a vigil mechanism for directors and employees to report concerns details of which are covered in the Corporate Governance Report which forms part of the Annual Report. Whistleblower Policy has been hosted on Company’s website www.lupin.com. Policies on Code of Conduct and Prevention of Workplace Harassment are on Company’s Intranet.

Particulars of Employees Remuneration

Particulars of remuneration of employees required to be furnished pursuant to the provisions of Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure ‘F’ to this Report. Particulars of remuneration of employees required to be furnished in terms of Rules 5(2) and 5(3) of the said Rules, forms part of this Report, which shall be provided to Members upon written request pursuant to the second proviso of Rule 5. Particulars of remuneration of employees are available for inspection by Members at the Registered office of the Company during business hours on all working days up to the date of the forthcoming AGM.

Auditors

At the 34th AGM held on Wednesday, August 3, 2016, Members appointed B S R & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W-100022), as Statutory Auditors of the Company, for a period of five years from the conclusion of 34th AGM till the conclusion of 39th AGM, subject to ratification of their appointment by Members at every AGM.

Pursuant to the provisions of Sections 139(1) and 141 of the Act, the Company has received a Certificate from B S R & Co. LLP, certifying that if they are appointed as Auditors, their appointment would be as per the conditions prescribed by the said Sections.

Pursuant to the provisions of Section 139 of the Act read with Rule 6 of the Companies (Audit and Auditors) Rules, 2014, Members will ratify the appointment of B S R & Co. LLP as Statutory Auditors of the Company, from the conclusion of the 35th AGM till the conclusion of the 36th AGM or any adjournment thereof.

Internal Audit

Ernst & Young LLP, Mumbai, are Internal Auditors of the Company for India operations. During the year, Price Waterhouse & Co., Bangalore, LLP were appointed as Internal Auditors to conduct audit of international subsidiaries of the Company. Local Chartered Accountant firms were also appointed as Internal Auditors to conduct audits of Carrying & Forwarding Agents and Central Warehouses of the Company in India.

Cost Auditors

On the recommendation of the Audit Committee, the Board of Directors appointed Mr. S. D. Shenoy, practising Cost Accountant (FCMA, Membership No. 8318), to conduct cost audit for the year ended March 31, 2017, pursuant to the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014. Mr. Shenoy has confirmed that he is free from disqualifications specified by Section 141 read with Section 148 of the Act and that his appointment meets requirements of Section 141(3)(g) of the Act. He has further confirmed that he is independent and maintains an arm’s length relationship with the Company and that no orders are pending against him relating to professional matters of conduct before the Institute of Cost Accountants of India or any court of competent authority.

Pursuant to Rule 14 of the Companies (Audit and Auditors) Rules, 2014, remuneration payable to the Cost Auditor is required to be placed before Members in a General Meeting for ratification. Accordingly, an Ordinary Resolution was passed by Members approving remuneration payable to Mr. Shenoy at the 34th AGM.

Pursuant to Section 148(6) of the Act and Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014, Cost Audit Report, in Form CRA-4 (in XBRL mode), for the year ended March 31, 2016, under the head ‘Drugs and Pharmaceuticals’ was filed with the Central Government on October 19, 2016, well within the prescribed time.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Act and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company appointed Ms. Neena Bhatia, Company Secretary in Practice, to undertake Secretarial Audit of the Company for the year ended March 31, 2017. Secretarial Audit Report in prescribed Form No. MR-3 is given in Annexure ‘G’ to this Report. The Company continues to have an unqualified Secretarial Audit Report.

Extract of Annual Return

Pursuant to the provisions of Sections 134(3)(a) and 92(3) of the Act read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return as on March 31, 2017, in prescribed Form No. MGT-9 is given in Annexure ‘H’ to this Report.

Acknowledgements

Your Directors convey a sense of high appreciation to all the employees of the Company for their hard work, dedication, continued commitment and significant contributions. Your Directors gratefully acknowledge the support and cooperation received from various departments of the Central and State governments, members, business associates, analysts, banks, financial institutions, medical professionals, customers, distributors and suppliers.

For and on behalf of the Board of Directors

Dr. Desh Bandhu Gupta

Chairman

(DIN: 00209378)

Mumbai, May 24, 2017


Mar 31, 2016

The Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2016.

Financial Results

(Rs. in million)

Standalone Consolidated

2015-16 2014-15 2015-16 2014-15

Sales (Gross) 109139.8 97050.5 138055.3 126932.2

Profit before interest, depreciation and tax 42259.4 35538.8 39411.5 38593.4

Less: Interest and finance charges 147.8 49.0 446.2 98.1

Less: Depreciation and amortisation 3056.1 3367.9 4635.0 4347.0

Profit before tax 39055.5 32121.9 34330.3 34148.3

Less: Provision for taxation (including deferred tax) 10204.8 8148.4 11535.8 9704.0

Net Profit before Minority Interest 28850.7 23973.5 22794.5 24444.3

Less: Minority Interest - - 87.6 411.9

Net Profit 28850.7 23973.5 22706.9 24032.4

Add: Surplus brought forward from previous year 65951.2 46646.6 63764.5 44401.0

Amount available for Appropriation 94801.9 70620.1 86471.4 68433.4 Appropriations:

Depreciation adjustment on transition to Schedule II of the - 610.8 - 610.8 Companies Act, 2013

Add: Profit on disposal of partial investment in a subsidiary - - 43.7 -

Proposed final dividend on Equity Shares 3379.4 3371.2 3379.4 3371.2

Dividend on Equity Shares for previous year 3.0 0.5 3.0 0.5

Corporate Tax on dividend 688.6 686.4 688.6 686.4

Balance carried to Balance Sheet 90730.9 65951.2 82444.1 63764.5

94801.9 70620.1 86471.4 68436.7

Performance Review

Your Company scaled new heights with consolidated sales clocking Rs. 138055.3 million as against Rs. 126932.2 million of the previous year, higher by about 9%. International markets accounted for 73% of sales. Profit before interest, depreciation and tax was Rs. 39411.5 million. Profit before tax was Rs. 34330.3 million. After providing for taxes and minority interest, net profit was Rs. 22706.9 million. Earnings per share was Rs. 50.45.

Dividend

Your Directors are pleased to recommend dividend at Rs. 7.50 per equity share of Rs. 2/- each, absorbing an amount of Rs. 3379.4 million. Corporate tax on the proposed dividend was Rs. 688.0 million and Rs. 0.6 million on dividend for the previous year.

Share Capital

As approved by the Members at the 33rd Annual General Meeting (AGM) of the Company held on July 23, 2015, the Authorised Share Capital of the Company was increased from Rs. 1,000,000,000 (Rupees One Thousand million) divided into 500,000,000 (Five Hundred million) Equity Shares of Rs. 2/- each to Rs. 2,000,000,000 (Rupees Two Thousand million) divided into 1,000,000,000 (One Thousand million) Equity Shares of Rs. 2/- each.

During the year, the paid-up equity share capital of the Company rose by Rs. 2.2 million consequent to the allotment of 1,094,634 equity shares of Rs. 2/- each to eligible employees on exercise of stock options under the ''Lupin Employees Stock Option Plan 2003'', ''Lupin Employees Stock Option Plan 2005'', ''Lupin Subsidiary Companies Employees Stock Option Plan 2005'', ''Lupin Employees Stock Option Plan 2011'', ''Lupin Subsidiary Companies Employees Stock Option Plan 2011'' and ''Lupin Employees Stock Option Plan 2014.''

Credit Rating

ICRA Limited (ICRA) has assigned the rating "ICRA A1 " (pronounced ''ICRA A one Plus'') for the Company''s short-term credit facilities of Rs. 13100 million, indicating very strong degree of safety regarding timely payment of financial obligations and "ICRA AAA" (pronounced ''ICRA triple A'') for long-term credit facilities of Rs. 1900 million, indicating highest degree of safety regarding timely servicing of financial obligations. The outlook on the long-term rating is ''Stable''.

ICRA has assigned the rating "ICRA AAA" to the Company''s Non-Convertible Debenture programme of Rs. 1000 million, indicating highest degree of safety regarding timely servicing of financial obligations. The outlook on the rating is ''Stable''.

Indian Accounting Standards (IND AS) - IFRS Converged Standards

The Ministry of Corporate Affairs, vide notification dated February 16, 2015, notified the Companies (Indian Accounting Standard Rules), 2015, in pursuance of which, the Company, its subsidiaries and the joint venture shall adopt IND AS with effect from April 1, 2016, with comparatives for the year ended March 31, 2016. The implementation of IND AS is a major change and the Company has planned smooth transition to IND AS. The first IND AS financial results shall be published for the quarter ending June 30, 2016.

Acquisitions

In pursuit of achieving inorganic growth and with a view to accelerate progress by expanding presence across select geographies, your Company made the following acquisitions: -

a) The entire shareholding in Gavis Pharmaceuticals, LLC, USA, Novel Laboratories, Inc., USA, VGS Holdings, Inc., USA, Edison Therapeutics, LLC, USA and Novel Clinical Research (India) Private Limited, India (collectively referred as Gavis), was acquired through Lupin Inc., USA, wholly-owned subsidiary of the Company. The transaction was closed on March 8, 2016, thereby making Gavis, a wholly-owned subsidiary of the Company. Gavis has an impressive portfolio of niche products with limited competition and high barriers to entry. It is a market leader in colonoscopy preparations with over 40% share and a strong pipeline of controlled substances. Gavis has a deep pipeline of several products under development for oral/liquids, dermatology, injectables, opthalamics, nasal and MDI and has capability to produce tablets, capsules, controlled release product, dry powder suspension, nasal spray and liquid solutions.

b) The entire shareholding in Medquimica Industrial Farmaceutica LTDA, Brazil (formerly known as Medquimica Industria Farmaceutica S.A., Brazil) (Medquimica) was acquired through Lupin Farmaceutica do Brasil LTDA, Brazil, a wholly-owned subsidiary of the Company on June 24, 2015. Medquimica, one of the fastest growing broad based pharmaceutical companies in Brazil, is engaged in the development, manufacturing and commercialization of OTC products, branded generics and generics, which are sold through push and pull models. Medquimica is a trusted brand with an established distribution network of medium and small distributors and presence across drug stores. It has a sound manufacturing facility with critical ANVISA-handling skills and experience and requisite approvals are in place. As part of restructuring operations, Lupin Farmaceutica do Brasil LTDA, Brazil, merged with Medquimica and the entire shareholding of Medquimica is now held by Lupin Atlantis Holdings SA, Switzerland, wholly-owned subsidiary of the Company.

Subsidiary Companies/Joint Venture

As on March 31, 2016, the Company had 30 subsidiaries and a joint venture.

On December 7, 2015, Lupin Atlantis Holdings SA, Switzerland and Lupin Holdings B. V., Netherlands, wholly-owned subsidiaries of the Company, jointly incorporated Lupin Pharma LLC, Russia, as a distribution company.

On March 8, 2016, Lupin Inc., USA, wholly-owned subsidiary of the Company, incorporated Lupin Research Inc., USA, for carrying out R&D activities.

Pursuant to the first proviso to Section 129(3) of the Companies Act, 2013 (''Act'') and Rules 5 and 8(1) of the Companies (Accounts) Rules, 2014, the salient features of the financial statements, performance and financial position of each subsidiary and the joint venture are given in Form AOC - 1 as Annexure ''A'' to this Report.

The Company has framed a policy for determining material subsidiaries, which has been hosted on the Company''s website (web link: http://www.lupin.com/pdf/Policy_for_determining_material_subsidiaries.pdf).

Management Discussion and Analysis

In compliance with Regulation 34(3) read with Schedule V(B) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (''Listing Regulations''), Management Discussion and Analysis forms part of this Annual Report.

Corporate Governance Report

In compliance with Regulation 34(3) read with Schedule V(C) of the Listing Regulations, a Report on Corporate Governance forms part of this Annual Report. The Auditors'' certificate certifying compliance with the conditions of corporate governance as prescribed under Schedule V(E) of the Listing Regulations is annexed to the Corporate Governance Report.

Business Responsibility Report

In compliance with Regulation 34(2)(f) of the Listing Regulations, the Business Responsibility Report forms part of this Annual Report.

Corporate Social Responsibility (CSR)

The Company is one of the pioneers in the CSR field having been engaged in social welfare activities for over 30 years. It has been implementing its CSR activities mainly through the Lupin Human Welfare and Research Foundation (LHWRF). LHWRF has a well-set implementation mechanism at the grass-root level, with an objective of transforming rural lives. LHWRF reaches out to 2.8 million living in 3,500 villages.

During the year, a programme was also undertaken to detect Tuberculosis and create awareness in the slum areas of Mumbai. Various CSR activities/initiatives were taken up at select centres with district development oriented approach for rural development in the backward areas as also at Company''s plant locations.

The Company undertakes the following CSR activities: -

- Economic and Social Development and Natural Resource Management;

- Rural Infrastructure development at various locations (including areas near the plant locations of the Company);

- Learn and Earn programs with a view to provide opportunities and monetary support to needy students, particularly in small towns and rural areas to enable them to pursue higher studies;

- Rural Industry and Skill Development; and

- Women Health, Empowerment and Education.

Pursuant to the provisions of Section 135 of the Companies Act, 2013 (''the Act'') read with Companies (Corporate Social Responsibility Policy) Rules, 2014, during the year, the Company ought to have spent Rs. 541.5 million on CSR activities. Of this a sum of Rs. 205.1 million was spent.

With a view to further support the poor and marginalised sections of the society, the Company would be accelerating its pace of CSR spend. The Company has set up a Charitable Trust known as ''Lupin Foundation'', with a purpose of setting-up deeper sustainable projects like hospitals, educational institutions which will substantially enhance its CSR spend.

Details of CSR activities are given in Annexure ''B'' to this Report. The policy on CSR as approved by the Board has been hosted on the Company''s website www.lupin.com.

Directors'' Responsibility Statement

In compliance with the provisions of Section 134(3)(c) read with Section134(5) of the Act, your Directors confirm: -

i) that in the preparation of the annual financial statements for the year ended March 31, 2016, the applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) they had 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 at the end of the financial year March 31, 2016 and of the profit of the Company for that year;

iii) that 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;

iv) that the annual financial statements have been prepared on a going concern basis;

v) that they had laid down proper internal financial controls and that the same are adequate and were operating effectively; and

vi) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Directors

Pursuant to the provisions of Section 152 of the Act, Mr. Nilesh Gupta, Managing Director, retires by rotation at the forthcoming AGM and is eligible for re-appointment.

Mr. Ramesh Swaminathan, Chief Financial Officer & Executive Director and Mr. Jean-Luc Belingard, an Independent Director, who were appointed as Additional Directors, w.e.f. October 27, 2015, hold office up to the date of the forthcoming AGM. Notices along with requisite deposits under Section 160(1) of the Act, have been received from certain members proposing their names for appointment as Directors.

The Company has received declarations from all the Independent Directors that they meet the criteria of independence prescribed by Section 149(6) of the Act.

During the year, five Board meetings were held on May 13, 2015, June 22, 2015, July 23, 2015, October 27, 2015 and February 5, 2016, the details of which are given in the Corporate Governance Report forming part of the Annual Report.

Board Evaluation

Pursuant to the provisions of Section 134(3)(p) of the Act read with Rule 8(4) of the Companies (Accounts) Rules, 2014, the Board carried out an annual evaluation of its own performance and that of its Committees and individual directors. The performance of the Board and Committees were evaluated by the Board after seeking inputs from all the directors on the basis of the prescribed criteria, such as the composition and structure of the Board, quality of deliberations, effectiveness of the procedures adopted by the Board, participation at the Board and Committee meetings, governance reviews etc. The performance of individual Directors was evaluated on the basis of criteria like transparency, analytical abilities, qualifications, leadership qualities, experience, participation in the long-term strategic planning and responsibilities shouldered.

Audit Committee

The Audit Committee comprises Dr. K. U. Mada, Chairman, and Mr. Dileep C. Choksi, independent directors, and Dr. Kamal K. Sharma, Vice Chairman of the Company. The functions performed by the Audit Committee, particulars of meetings held and attendance thereat is given in the Corporate Governance Report which forms part of the Annual Report.

Nomination and Remuneration Policy

The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a Policy relating to the remuneration of directors, key managerial personnel and other employees. The Policy includes criteria for determining qualifications, positive attributes and independence of a director. The functions of the Nomination and Remuneration Committee are disclosed in the Corporate Governance Report, which forms part of the Annual Report.

Related Party Transactions

All transactions entered into by the Company with related parties during the financial year were in the ordinary course of business and on an arm''s length pricing basis. No transaction with any related party was in conflict with the interest of the Company. The Company did not enter into any related party transaction with its Key Managerial Personnel. Material related party transactions were entered into by the Company only with its subsidiaries. In terms of the provisions of Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, particulars of related party transactions are given in Form AOC - 2, as Annexure ''C'' to this Report. The policy on Related Party Transactions as approved by the Board has been hosted on the Company''s website www.lupin.com and web link for which is http://www.lupin.com/pdf/POLICY-RELATED_PARTY_TRANSACTIONS.pdf

Risk Management

Services of Ernst & Young LLP were engaged for framing, monitoring and implementing the risk management plan of the Company. The said firm is in the process of reviewing the existing risk management process and structure including roles and responsibilities, risk rating criteria for assessing impact and the likelihood of risks and effectiveness of mitigation plans. The process includes documentation of risk prioritization and obtaining the Management''s assessments on ''risks that matter'' and assessing mitigation readiness for the ''risks that matter''. The Risk Management Committee constituted by the Board, pursuant to Regulation 21 of the Listing Regulations, monitors and reviews the risk management plan. The details of the Committee and its terms of reference are set out in the Corporate Governance Report. The functions of the Risk Management Committee are disclosed in the Corporate Governance Report, which forms part of the Annual Report.

Particulars of loans/guarantees/investments/securities

Particulars of loans, guarantees, investments and securities pursuant to the provisions of Section 186 of the Act are given in the notes to the Financial Statements forming part of the Annual Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as prescribed by Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, relating to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in Annexure ''D'' to this Report.

Human Resources

There has been a steady rise in the ranking of the Company on a pan-industry basis in the surveys jointly conducted by ''Great Places to Work Institute'' and ''The Economic Times''. The Company has been consistently ranked No. 1 or 2 in the Pharmaceutical and Biotech sector and it has also featured in the Golden List of India''s Top 50 companies to work for. The Company was ranked 15th best company to work for in Asia by the survey conducted by the ''Great Places to Work Institute''. Aon Hewitt, in collaboration with Business World magazine, through a detailed process, ranks the top 25 companies across all sectors/industries. There is no ranking among these companies. The Company has featured in the coveted list.

The Company''s endeavor has been to provide its employees the best value proposition and experience. It meaningfully engages them to deliver their best, which ultimately results in superior business performance and building a competitive work environment. With a view to enthuse a vibrant work culture, the Company instituted various employee-friendly policies and manpower development programs across all levels, which ensured that employees remain motivated and invigorated.

Employees Stock Options

Pursuant to the provisions of the Securities and Exchange Board of India (Share-Based Employee Benefits) Regulations, 2014, the details of stock options during the year ended March 31, 2016 are given in Annexure ''E'' to this Report.

Vigil Mechanism/Whistleblower Policy

In order to promote a culture of honesty and fairness in its operations and in compliance with the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Regulation 22 of the Listing Regulations, the Company has instituted P.L.E.D.G.E. (Preparing Lupin Employees to Demonstrate Governance and Ethical Conduct). The P.L.E.D.G.E. initiative encompasses three important policies viz. Code of Conduct, Whistleblower Policy and Prevention of Workplace Harassment. The Whistleblower Policy provides an opportunity to the directors and all employees of the Company to raise concerns about unethical and improper practices or any suspected wrongdoings in relation to the Company. The details of Code of Conduct, Whistleblower Policy and Prevention of Workplace Harassment Policy are stated in the Corporate Governance Report, which forms part of the Annual Report. Whistleblower Policy has been hosted on the Company''s website www.lupin.com. The Policies on Code of Conduct and Prevention of Workplace Harassment are on the Lupin Intranet.

Particulars of Employees

Particulars of remuneration required to be furnished in terms of the provisions of Section 197(12) of the Act read with Rules 5(1), 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure ''F'' to this Report.

Auditors

At the 32nd AGM, the Members had appointed Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W-100018), as Statutory Auditors of the Company, for a period of two years from the conclusion of the 32nd AGM till the conclusion of the forthcoming AGM. In view of completion of the prescribed term of Deloitte Haskins & Sells LLP, on the recommendation of the Audit Committee, the Board of Directors, appointed BSR & Co. LLP, Chartered Accountants (Firm Registration No. 101248W/W-100022), as the Statutory Auditors of the Company, for a period of five years from conclusion of the 34th AGM till the conclusion of 39th AGM of the Company, subject to ratification by Members at every AGM.

Pursuant to the provisions of Section 139(1) and Section 141 of the Act, the Company has received a Certificate from BSR & Co. LLP, certifying that if they are appointed as Auditors, their appointment would be as per the conditions prescribed by the said Sections.

The Board records its sincere appreciation of the valuable services rendered by Deloitte Haskins & Sells LLP during its long association with the Company.

Internal Audit

Ernst & Young LLP and KPMG are the Internal Auditors of the Company for the domestic and international operations respectively.

The Company appointed local Chartered Accountants firms as Internal Auditors to conduct audit of Carrying & Forwarding Agents and Central Warehouses located in various parts of the country.

Cost Auditors

The cost audit records maintained by the Company are required to be audited pursuant to the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Amendment Rules, 2014. On the recommendation of the Audit Committee, Mr. S. D. Shenoy, practising Cost Accountant (FCMA, Membership No.8318), was appointed to conduct cost audit for the year ended March 31, 2016.

Pursuant to Section 148(6) of the Act and Rule 6(6) of the Companies (Cost Records and Audit) Rules, 2014, the Cost Audit Report, in Form CRA-4 (in XBRL mode), for the year ended March 31, 2015, under the head ''Drugs and Pharmaceuticals Industry'' was filed with the Central Government on October 16, 2015, well within the prescribed time.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Act and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, Ms. Neena Bhatia, Company Secretary in Practice, was appointed to undertake the Secretarial Audit of the Company for the year ended March 31, 2016. There is no qualification in the Secretarial Audit Report which is given in Annexure ''G'' to this Report.

Extract of Annual Return

Pursuant to the provisions of Section 92(3) of the Act and the Rules made thereunder, extract of the Annual Return in prescribed Form MGT-9 is given in Annexure ''H'' to this Report.

Acknowledgements

Your Directors commend the commitment, dedication, contributions and hard work of all employees of the Company across the globe. They express their deep gratitude to the various departments of the Central and State governments, banks, financial institutions, customers, medical professionals, business associates, analysts, members, suppliers and distributors for their whole-hearted and continuous support. For and on behalf of the Board of Directors

Dr. Desh Bandhu Gupta

Chairman

(DIN: 00209378)

Mumbai, May 19, 2016


Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2015. Financial Results

(Rs. in million) Standalone Consolidated

2014-15 2013-14 2014-15 2013-14

Sales (Gross) 97050.5 88576.6 126932.2 111671.2

Profit before interest, depreciation and tax 35538.8 33277.1 38593.4 31192.7

Less: Interest and finance charges 49.0 209.9 98.1 266.5

Less: Depreciation and amortisation 3367.9 1676.3 4347.0 2609.7

Profit before tax 32121.9 31390.9 34148.3 28316.5

Less: Provision for taxation (including deferred tax) 8148.4 8148.7 9704.0 9621.5

Net Profit before Minority Interest 23973.5 23242.2 24444.3 18695.0

Less: Minority Interest - - 411.9 331.3

Net Profit 23973.5 23242.2 24032.4 18363.7

Add: Surplus brought forward from previous year 46646.6 28539.2 44401.0 31172.1

Amount available for Appropriation 70620.1 51781.4 68433.4 49535.8

Appropriations:

Depreciation adjustment on transition to Schedule II of the 610.8 - 610.8 - Companies Act, 2013

Transfer to General Reserve - 2500.0 - 2500.0

Interim Dividend on Equity Shares - 1345.0 - 1345.0

Proposed final dividend on Equity Shares 3371.2 1345.1 3371.2 1345.1

Dividend on Equity Shares for previous year 0.5 1.1 0.5 1.1

Reversal of Corporate Tax on Final Dividend for previous years - (304.2) - (304.2)

(In terms of Section 115-O/ 115BBD of the Income Tax Act, 1961)

Corporate Tax on dividend 686.4 247.8 686.4 247.8

Balance carried to Balance Sheet 65951.2 46646.6 63764.5 44401.0

70620.1 51781.4 68436.7 49535.8

Performance Review

Your Company touched new heights in terms of sales and profits for the year ended March 31, 2015. Consolidated sales clocked Rs.126932.2 million as against Rs. 111671.2 million of the previous year, higher by 13.7%. International markets accounted for 73% of sales. Profit before interest, depreciation and tax increased by 23.7% at Rs. 38593.4 million as against Rs. 31192.7 million in the previous year. Profit before tax was Rs. 34148.3 million, higher by 20.6% over the previous year. After providing for taxes and minority interest, net profit was Rs. 24032.4 million, higher by 30.9% over the previous year. Earnings per share was Rs. 53.54.

Dividend

Your Directors are pleased to recommend dividend at Rs. 7.50 per equity share of Rs. 2/- each, absorbing an amount of Rs. 3371.2 million. Corporate tax on the proposed dividend was Rs. 686.3 million and Rs. 0.1 million on dividend for the previous year.

Share Capital

During the year, the paid-up equity share capital of your Company rose by Rs.2.2 million consequent to the allotment of 1,112,531 equity shares of Rs. 2/- each to eligible employees on exercise of stock options under the ''Lupin Employees Stock Option Plan 2003'', ''Lupin Employees Stock Option Plan 2005'', ''Lupin Subsidiary Companies Employees Stock Option Plan 2005'', ''Lupin Employees Stock Option Plan 2011'' and ''Lupin Subsidiary Companies Employees Stock Option Plan 2011''.

Credit Rating

ICRA Limited (ICRA) had assigned the rating "ICRA A1 " (pronounced ''ICRA A one Plus'') for the Company''s short-term credit facilities of Rs.13100 million and "ICRA AA " (pronounced ''ICRA double A Plus'') for long-term credit facilities of C 1900 million. During the year, ICRA upgraded the rating of long-term credit facilities from "ICRA AA " to "ICRA AAA" (pronounced ''ICRA triple A''), indicating the highest degree of safety regarding timely servicing of financial obligations. The outlook on the long-term rating is ''Stable''. ICRA affirmed the rating of "ICRA A1 " for short-term credit facilities which is the highest rating.

ICRA had assigned the rating "ICRA AA " to the Company''s Non- Convertible Debenture programme of C1000 million. ICRA also upgraded the same from ''ICRA AA '' to ''ICRA AAA'', indicating the highest degree of safety regarding timely servicing of financial obligations. The outlook on the rating is ''Stable''.

Acquisitions

In its strategy to pursue inorganic growth for further accelerating its progress and expanding its presence in select geographies, the following acquisitions were made: -

Lupin acquired the entire shareholding of Laboratorios Grin, S.A. de C.V., Mexico, (''Lab Grin''), a 60-year old company specializing in opthalmics. Lab Grin was ranked 4th in the opthalmics segment in the Mexican market, commanding 11% market share with a CAGR of 10%. It has superior brand recognition, an outstanding reputation with the medical community, a state-of-the-art manufacturing facility, highly regarded management team and attractive profit margins. The acquisition would add value in the opthalmic pharmaceutical and opthalmic vision care segments.

The Company held 60% stake in Pharma Dynamics (Proprietary) Ltd., South Africa (Pharma Dynamics), a subsidiary of the Company. The balance 40% was held by the ''Anley Group'' which had a ''Put Option'' to sell its stake to the Company. The minority shareholders exercised their ''Put Option'' and accordingly, Pharma Dynamics has become a wholly-owned subsidiary of the Company as on March 31, 2015. Payment under ''Put Option'' is based on the audited financials as on March 31, 2015, reconciliation of the EBIDTA and net cash as also subject to due diligence. This acquisition represents significant foreign investment into South Africa and is a major vote of confidence in the business. It would add additional global muscle to the operations of Pharma Dynamics and support the next phase of growth for the Company.

Subsidiary Companies/Joint Venture

As on March 31, 2015, the Company had 23 subsidiaries and a joint venture.

On April 23, 2014, the Company through its wholly-owned subsidiary entered into a joint venture, YL Biologics Ltd., Japan, with Yoshindo Inc., Japan, for clinical development of Biosimilars. Max Pharma Pty Ltd., Australia, was liquidated on December 17, 2014.

Pursuant to the first proviso to Section 129(3) of the Companies Act, 2013 and Rules 5 and 8(1) of the Companies (Accounts) Rules, 2014, the salient features of the financial statements, performance and financial position of each subsidiary and a joint venture is given in Form AOC - 1 as Annexure ''A'' to this Report.

The Company has framed a policy for determining material subsidiaries, which has been uploaded on the Company''s website (web link: http://www.lupin.com/pdf/Policy_for_ determining_material_subsidiaries.pdf).

Management Discussion and Analysis

A detailed Management Discussion and Analysis forms part of this Annual Report.

Corporate Governance

A Report on Corporate Governance forms part of this Annual Report. The Auditors'' certificate certifying compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement is also annexed to this Report.

Business Responsibility Report

In compliance with Clause 55 of the Listing Agreement, the

Business Responsibility Report forms part of this Annual Report.

Corporate Social Responsibility

Long before the Corporate Social Responsibility (CSR) concept formally came into vogue, the Company, through its CSR arm, Lupin Human Welfare and Research Foundation (LHWRF), has been promoting numerous sustainable rural development programmes across chosen geographies with a view to improve the human development indices. LHWRF which was set up in 1988 has collaborated with various institutions, governments, individuals, visionaries and domain experts on multiple projects to ensure growth and progress of the rural poor.

Pursuant to the provisions of Section 135 of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014, during the year, the Company ought to have spent H 396 million on CSR activities. The actual spend was H126 million. The Company broadly undertakes the following CSR activities: -

- Rural development activities at various locations (including local areas near the plants of the Company);

- Learn and Earn programme which is aimed at providing opportunity to worthy students who are not financially capable of pursuing their graduation; and

- TB detection.

The Board is committed to help the poorest of the poor and the marginalised sections of the society at large and has plans to increase CSR expenses especially in the areas of TB detection, medical camps, etc. The Company also intends to undertake deeper and sustainable long-term projects such as Hospitals or Universities or similar institutions which shall increase its CSR spend manifold in the coming years.

Details of CSR activities are given in Annexure ''B'' to this Report. The policy on CSR as approved by the Board has been uploaded on the Company''s website www.lupin.com.

Directors'' Responsibility Statement

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

i) that in the preparation of the annual financial statements for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanations relating to material departures;

ii) they had 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 at the end of the financial year March 31, 2015 and of the profit of your Company for that year;

iii) that 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;

iv) that the annual financial statements have been prepared on a going concern basis;

v) that they had laid down proper internal financial controls and that the same are adequate and were operating effectively; and

vi) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Directors

The Company, led by the Board of Directors and a strong senior management team, is poised to enter higher orbits of growth. In this direction, the Board at its meeting held on May 13, 2015, re-appointed Dr. Desh Bandhu Gupta, Chairman, for a period of five years, effective January 1, 2016, Dr. Kamal K. Sharma, Vice Chairman, for a period of two years, effective September 29, 2015 and Mrs. M. D. Gupta, Executive Director, for a period of five years, effective January 1, 2016, on such terms and conditions as may be finalised and subject to approvals of the Members and such approvals as may be necessary.

Dr. Gupta has displayed leadership of exceptionally high order and provided the Company, the benefit of his insight into the pharmaceutical industry, business acumen and vast experience. Under his stewardship, the Company has grown exponentially and is poised to seek newer heights in the years to come. Dr. Sharma has effectively led the team and as Vice Chairman, is involved in setting vision of the Company, building strategy and mentoring the management team. Mrs. Gupta is one of the promoters of the Company with intimate knowledge of the working of the Company, wide business experience and expertise.

Pursuant to the provisions of Section 152 of the Companies Act, 2013, (''Act'') Ms. Vinita Gupta, Director, retires by rotation at the forthcoming Annual General Meeting and is eligible for re-appointment.

Pursuant to the provisions of Sections 149, 152 read with Schedule IV of the Act and Rules made thereunder, Dr. Vijay Kelkar, Mr. R. A. Shah, Mr. Richard Zahn, Dr. K. U. Mada and Mr. Dileep C. Choksi are being appointed as Independent Directors of the Company for a fresh term of five years by passing Special Resolutions. Dr. Kelkar, Mr. Shah, Mr. Zahn, Dr. Mada and Mr. Choksi have given declarations that they meet the criteria of independence as prescribed under Section 149(6) of the Act and Clause 49 of the Listing Agreement.

During the year, four Board meetings were held viz. on May 7, 2014, July 30, 2014, October 28, 2014 and February 3, 2015, the details of which are given in the Corporate Governance Report.

Board Evaluation

In compliance with the provisions of Section 134(3)(p) of the Companies Act, 2013, the Board carried out an annual evaluation of its own performance and individual directors. It also evaluated the performance of the Audit, Nomination & Remuneration, Stakeholders Relationship and Corporate Social Responsibility Committees. The evaluation inter alia covered different aspects viz. composition of the Board and its Committees, qualifications, experience, expertise, leadership qualities, attendance at the meetings, contribution, responsibilities shouldered etc. In compliance with Clause 49(1)(D)(2)(i) of the Listing Agreement, the Board monitors and reviews the Board evaluation framework.

Audit Committee

The Audit Committee comprises Dr. K. U. Mada, Chairman and Mr. Dileep C. Choksi, independent directors, and Dr. Kamal K. Sharma, Vice Chairman of the Company. The functions performed by the Audit Committee and the particulars of meetings held and attendance thereat are given in the Corporate Governance Report.

Nomination and Remuneration Policy

The Company has a Nomination and Remuneration Policy. In compliance with the provisions of Sections 134(3)(e) and 178 of the Companies Act, 2013 and Clauses 49(II)(B) (5) and 49(IV)(B) of the Listing Agreement, the Nomination & Remuneration Committee:

i) has formulated criteria for determining qualifications, positive attributes and independence of a director;

ii) identifies persons who are qualified to become directors or may be appointed in Senior Management in accordance with criteria laid down and recommend to the Board their appointment and removal;

iii) recommends to the Board, Policy relating to remuneration for directors, KMP and other employees;

iv) has formulated the evaluation criteria for performance evaluation of independent directors and the Board;

v) carries out evaluation of every director''s performance and the Board; and

vi) devises a policy on Board diversity.

Related Party Transactions

All related party transactions entered into during the financial year were on an arm''s length basis and in the ordinary course of business. No related party transaction was in conflict with the interest of the Company. Material related party transactions were entered into by the Company only with its subsidiaries. No materially significant related party transaction was made by the Company with the Key Managerial Personnel. As prescribed by Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, particulars of related party transactions are given in Form AOC-2, as Annexure ''C'' to this Report. The policy on Related Party Transactions as approved by the Board has been uploaded on the Company''s website www.lupin.com and web link for which is http://www.lupin.com/pdf/POLICY- RELATED_PARTY_TRANSACTIONS.pdf.

Risk Management

In terms of Clause 49(VI) of the Listing Agreement, the Board constituted a Risk Management Committee. The details of the Committee and its terms of reference are set out in the Corporate Governance Report. Ernst & Young LLP were appointed to assist the Company in implementing the Risk Management framework in a formal manner.

We are pleased to inform you that your Company has been awarded ''Firm of the Year'' in the pharmaceutical sector at the India Risk Management awards by ICICI Lombard and CNBC - TV18.

Particulars of loans/guarantees/investments/securities

Pursuant to the provisions of Section 134(3)(g) of the Companies Act, 2013 (Act), particulars of loans/guarantees/ investments/securities given under Section 186 of the Act are given in the notes to the Financial Statements forming part of the Annual Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as prescribed by Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in Annexure ''D'' to this Report.

Human Resources

Human Resources are invaluable assets of the Company. In the survey conducted by ''Great Place to Work®'' and ''The Economic Times'', for four years in a row, your Company has been rated amongst the TOP TWO ''Best Companies to Work for in the Biotechnology and Pharmaceutical Sector''. It also achieved the distinction of being included in the list of India''s TOP 50 Best Companies to Work for across all industries for the last two years. This recognition is a true testimony of superior people practices, pride of the employees as also overall employee orientation. The Company firmly believes that people are its most valued resource and their efficiency plays a key role in achieving set goals and building a competitive work environment. The Company regularly conducts several programmes across various levels which include development programmes and employee-friendly policies, in order to attract, retain and develop best available talents.

Employees Stock Options

Pursuant to the provisions of the Securities and Exchange Board of India (Share-Based Employee Benefits) Regulations, 2014, the details of stock options granted by the Company during the year ended March 31, 2015 are given in Annexure ''E'' to this Report.

Vigil Mechanism/Whistleblower Policy

In compliance with the provisions of Section 177(9) of the Companies Act 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 and Clause 49(II)(F) of the Listing Agreement, your Company has in place a ''Whistleblower Policy,'' which provides an opportunity to the directors and employees to raise concerns about unethical and improper practices or any other wrongful conduct in or in relation to the Company. The details of the Whistleblower Policy are stated in the Corporate Governance Report and the said Policy has been uploaded on the Company''s website www.lupin.com.

Particulars of Employees

Particulars of employees required to be furnished pursuant to

the provisions of Section 197 of the Companies Act, 2013 (Act), read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given as an Annexure to this Report. However, pursuant to the provisions of Section 136 of the Act, the Report and Accounts are being sent to all the Members excluding the aforesaid Annexure. Members, who are interested in the information, may write to the Company Secretary at the registered office of the Company.

The statement of particulars of appointment and remuneration of managerial personnel pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure ''F'' to this Report.

Auditors

At the 32nd Annual General Meeting (AGM), the Members appointed Deloitte Haskins & Sells LLP, Chartered Accountants, as Statutory Auditors of the Company, for a period of two years till the conclusion of the 34th AGM, subject to ratification by the Members at the 33rd AGM.

Pursuant to the provisions of Sections 139(1) and 141 of the Companies Act, 2013 (Act), the Company has received a Certificate from Deloitte Haskins & Sells LLP, certifying that if they are appointed as Auditors, their appointment would be as per the conditions prescribed by the said Sections.

Pursuant to the provisions of Section 139 of the Act read with Rule 6 of the Companies (Audit and Auditors) Rules, 2014, the Members will ratify the appointment of Deloitte Haskins & Sells LLP, as Statutory Auditors of the Company, from the conclusion of the 33rd AGM till the conclusion of the 34th AGM or any adjournment thereof.

Internal Audit

Ernst & Young LLP, Mumbai, are the Internal Auditors of the Company. During the year, the Company appointed KPMG to conduct internal audit of a few of its international subsidiaries.

The Company has also appointed local Chartered Accountants firms as Internal Auditors to conduct audit of Carrying & Forwarding Agents and Central Warehouses.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the cost audit records are required to be audited. Your Directors, on the recommendation of the Audit Committee, appointed Mr. S. D. Shenoy, practising Cost

Accountant (FCMA, Membership No.8318), to audit the cost accounts of the Company for the financial year 2015 -16 on a remuneration of H 500,000/- plus applicable taxes and out of pocket expenses. In terms of Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditor is required to be ratified by the Members. Accordingly, a Resolution seeking ratification by the Members for the remuneration payable to Mr. Shenoy has been included in the Notice convening the 33rd Annual General Meeting.

Pursuant to Rule 5 of the Companies (Cost Audit Report) Rules, 2011, the Cost Audit Report (in XBRL mode) for ''Pharmaceutical Products'' and ''Prepared Food Products'', for the year ended March 31, 2014, was filed with the Central Government on September 24, 2014, well within the prescribed time.

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company appointed Ms. Neena Bhatia, Company Secretary in Practice, to undertake the Secretarial Audit of the Company.

The Secretarial Audit Report is given in Annexure ''G” to this Report. There is no qualification in the said Report.

Extract of Annual Return

Pursuant to the provisions of Section 92 (3) of the Companies Act, 2013, extract of the Annual Return in Form MGT-9 is given in Annexure ''H'' to this Report.

Acknowledgements

Your Directors commend all employees of the Company for their hard work, continued dedication, commitment and significant contributions. Your Directors also wish to express their gratitude to the Central and State governments, members, analysts, banks, financial institutions, business associates, customers, medical professionals, distributors and suppliers, for their continued and whole-hearted support.

For and on behalf of the Board of Directors

Dr. Desh Bandhu Gupta Chairman

Mumbai, May 13, 2015


Mar 31, 2014

THE Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2014.

Financial Results

(Rs.in million)

Standalone Consolidated 2013-14 2012-13 2013-14 2012-13

Sales (Gross) 88576.6 70723.9 111671.2 95235.3

Profit before interest, depreciation and tax 33277.1 19072.3 31192.7 22977.4

Less: Interest and finance charges 209.9 332.8 266.5 409.5

Less: Depreciation and amortisation 1676.3 1501.4 2609.7 3321.9

Profit before tax 31390.9 17238.1 28316.5 19246.0

Less: Provision for taxation (including deferred tax) 8148.7 4633.8 9621.5 5841.6

Net Profit before Minority Interest 23242.2 12604.3 18695.0 13404.4

Less: Minority Interest 331.3 262.8

Net Profit 23242.2 12604.3 18363.7 13141.6

Add: Surplus brought forward from previous year 28539.2 19530.2 31172.1 21345.2

Amount available for Appropriation 51781.4 32134.5 49535.8 34486.8 Appropriations:

Transfer to General Reserve 2500.0 1500.0 2500.0 1500.0

Add: Transfer from Minority Interest 280.6

Interim Dividend on Equity Shares 1345.0 1345.0

Proposed final dividend on Equity Shares 1345.1 1790.1 1345.1 1790.1

Dividend on Equity Shares for previous year 1.1 0.9 1.1 0.9

Reversal of Corporate Tax on Final Dividend for previous years (304.2) (304.2)

(In terms of Section 115-0/115BBD of the Income Tax Act, 1961)

Corporate Tax on dividend 247.8 304.3 247.8 304.3

Balance carried to Balance Sheet 46646.6 28539.2 44401 31172.1

51781.4 32134.5 49535.8 34486.8

Performance Review

During the year, your Company''s turnover crossed Rs. 111 billion, with Consolidated Gross Sales clocking Rs. 111671.2 million as againstRs. 95235.3 million of the previous year, higher by 17%. International markets accounted for 74% of sales. Profit before interest, depreciation and tax increased by 36% at Rs. 31192.7 million as against Rs. 22977.4 million in the previous year. Profit before tax was Rs. 28316.5 million, higher by 47% over the previous year. After providing for taxes and minority interest, net profit was Rs. 18363.7 million, higher by 40% over the previous year. Earnings per share was Rs. 40.99.

Dividend

Your Directors are pleased to recommend final dividend at Rs.3/- per equity share of Rs.2/- each, for the year ended March 31, 2014, subject to the approval of the members at the ensuing Annual General Meeting. At its meeting held on February 3, 2014, the Board of Directors declared interim dividend of Rs.3/- per equity share of Rs.2/- each, which was paid on February 21, 2014. Thus, the total dividend for the year shall be 300% i.e. Rs. 6/- per equity share (as against 200% last year) amounting to Rs. 2690.1 million.

Share Capital

During the year, the paid-up equity share capital of your Company rose by H 1.7 million consequent to the allotment of 846311 equity shares of H 2/- each to eligible employees under the ''Lupin Employees Stock Option Plan 2003'', ''Lupin Employees Stock Option Plan 2005'', ''Lupin Subsidiary Companies Employees Stock Option Plan 2005'', ''Lupin Employees Stock Option Plan 2011'' and ''Lupin Subsidiary Companies Employees Stock Option Plan 2011''.

Credit Rating

ICRA Limited reaffirmed its "[ICRA] A1 " (pronounced "ICRA A one plus") rating for your Company''s working capital lines of H 15000 million from banks indicating a very strong degree of safety for timely payment of financial obligations. Of this limit, H 1900 million was assigned a long-term rating of "[ICRA] AA " (pronounced "ICRA double A plus") indicating a high degree of safety and the outlook was revised from ''Stable'' to ''Positive''.

The Company also enjoys "[ICRA] AA " rating for non-convertible debentures (NCDs) of H 1000 million, indicating a high degree of safety for timely servicing of financial obligations for long-term debt instruments and the outlook was been revised from ''Stable'' to ''Positive''. The Company did not issue any long-term NCDs during the year.

Acquisitions

In its strategy to pursue inorganic growth for further accelerating its progress and expanding its presence in select geographies, your Company made the following acquisitions through Lupin Atlantis Holdings SA, Switzerland, wholly-owned subsidiary: -

a) the entire shareholding of Laboratorios Grin, S.A. DE C.V., Mexico, (''Lab Grin''). Lab Grin, a 60 year old company specializing in Opthalmics. It is ranked 4th in the Opthalmics segment in the Mexican market, commanding 11% market share with a CAGR of 10%. Lab Grin has superior brand recognition and an outstanding reputation with the medical community. It has state-of-the-art manufacturing facility, a highly regarded management team and attractive profitability margins. The Company believes that the acquisition would add value in the opthalmic pharmaceutical and opthalmic vision care segments. The deal is subject to compliance to certain conditions which were yet to be fulfilled as on date.

(b) the entire shareholding of Nanomi B.V., the Netherlands, (''Nanomi'') to make significant in-roads into the niche area of complex injectables. Nanomi has patented technology platforms to develop complex injectable products and a rich talent pool of scientists who would be backed by the Company''s global R&D and manufacturing teams.

Lupin Holdings B.V., Netherlands, wholly-owned subsidiary of the Company, acquired the entire shareholding of Farma World Importacao e Exportacao de Medicamentos LTDA - EPP, Brazil (''Farma World''). The objective of Farma World is to import and export finished dosages, API, R&D consulting and participate in investments in Brazil and abroad.

Subsidiary Companies

As on March 31, 2014, the Company had 23 subsidiaries. Lupin Inc., U.S.A. and Lupin GmbH, Switzerland, wholly-owned subsidiaries, were incorporated on June 27, 2013 and August 15, 2013 respectively.

Financials of subsidiaries are disclosed in the Consolidated Financial Statements which form part of this Annual Report. Statement pursuant to the provisions of Section 212(1)(e) of the Companies Act, 1956 also forms part of this Annual Report.

Management Discussion and Analysis

A detailed Management Discussion and Analysis forms part of this

Annual Report.

Corporate Governance

Report on Corporate Governance forms part of this Annual Report. The Auditors'' certificate certifying compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement is also annexed to this Report.

Business Responsibility Report

In compliance with Clause 55 of the Listing Agreement, the Business

Responsibility Report forms part of this Annual Report.

Directors'' Responsibility Statement

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 (Act), your Directors confirm that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii) the Directors had 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 at the end of the financial year ended March 31, 2014 and of the profit of your Company for that year;

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

iv) the Directors had prepared the annual accounts on a ''going concern'' basis.

Directors

Pursuant to the provisions of Section 152 of the Companies Act, 2013, (''Act''), Dr. Kamal K. Sharma, Vice Chairman, retires by rotation at the forthcoming Annual General Meeting and is eligible for re-appointment. Pursuant to the provisions of Section 149 of the Act, Dr. Vijay Kelkar, Mr. Richard Zahn, Mr. R. A. Shah, Dr. K. U. Mada and Mr. Dileep C. Choksi are being appointed as independent directors for a period of one year at the forthcoming Annual General Meeting till the conclusion of the next Annual General Meeting.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as prescribed by Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in Annexure ''A''.

Fixed Deposits

Your Company has not accepted any fixed deposit during the year. During the year, seven deposits aggregating H 63,000/- lying unclaimed with the Company were transferred to the Investor Education and Protection Fund, pursuant to the relevant guidelines. No deposit was outstanding or lying unclaimed with the Company, as on March 31, 2014.

Auditors

Statutory Auditors of the Company, Deloitte Haskins & Sells LLP, Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting. They will be completing 10 consecutive years as Statutory Auditors of the Company. Pursuant to the provisions of Section 139 of the Companies Act, 2013, read with Rule 6 of the Companies (Audit and Auditors) Rules 2014, they will be re-appointed for a period of two years from the conclusion of the Thirty-Second Annual General Meeting till the conclusion of the Thirty-Fourth Annual General Meeting. The Audit Committee and the Board of Directors recommend their re-appointment as Statutory Auditors of your Company.

Ernst & Young LLP, Mumbai, are the Internal Auditors of the Company.

Cost Auditors

Pursuant to the provisions of Section 233B of the Companies Act, 1956, in terms of General Circular No.15/2011 dated April 11, 2011 and with the approval of the Central Government, Mr. S. D. Shenoy (Fellow Membership No.8318), practising Cost Accountant, was appointed as Cost Auditor to conduct audit of cost records for the year ended March 31, 2014. Cost Audit Report would be submitted to the Central Government within the prescribed time.

Pursuant to Rule 5 of the Companies (Cost Audit Report) Rules, 2011, the Cost Audit Report for Bulk Drugs and Formulations, for the year ended March 31, 2013 was filed with the Central Government on

September 27, 2013, in the Extensible Business Reporting Language (XBRL) mode.

Employees Stock Options

Pursuant to the provisions of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, the details of stock options granted by the Company during the year are set out in Annexure ''B'' forming part of this Report.

Human Resources

Your Company was ranked 2nd amongst ''India''s Best Companies to Work for - 2013'' in the Biotech and Pharma Sector, by the ''Great Places to Work Institute®'' and ''The Economic Times'', in their annual cross-industry study called Best Companies to Work for. The Company continues to be in the Top 2 for the third year in a row. This recognition is a true testimony of superior people practices, pride of the employees as also overall employee orientation. The Company firmly believes that people are its most valued resource and their efficiency plays a key role in achieving set goals and building a competitive work environment. The Company regularly conducts several programs across various levels which include development programs and employee-friendly policies, in order to attract, retain and develop best available talents.

Particulars of Employees

Particulars of employees required to be furnished pursuant to the provisions of Section 217(2A) of the Companies Act, 1956 (Act), read with Companies (Particulars of Employees) Amendment Rules, 2011, are given as an annexure to this Report. However, pursuant to the provisions of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to all the members excluding the aforesaid Annexure. Members, who are interested in the information, may write to the Company Secretary at the registered office of the Company.

Acknowledgements

Your Directors commend all employees of your Company for their hard work, continued dedication, commitment and significant contributions. Your Directors wish to express their gratitude to the Central and State governments, members, analysts, banks, financial institutions, business associates, customers, medical professionals, distributors and suppliers, for their continued whole-hearted support.

For and on behalf of the Board of Directors

Dr. Desh Bandhu Gupta

Chairman

Mumbai, May 7, 2014


Mar 31, 2013

The Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2013.

Financial Results

(Rs. in million)

Standalone Consolidated

2012-13 2011-12 2012-13 2011-12

Sales (Gross) 70723.9 53579.1 95235.3 70017.2

Profit before interest, depreciation and tax 19072.3 11653.5 22978.1 14590.6

Less: Interest and finance charges 332.8 286.8 410.2 354.7

Less: Depreciation and amortisation 1501.4 1319.6 3321.9 2275.2

Profit before tax 17238.1 10047.1 19246.0 11960.7

Less: Provision for taxation (including deferred tax) 4633.8 2003.4 5841.6 3085.6

Net Profit before Minority Interest - - 13404.4 8875.1

Less: Minority Interest - - 262.8 198.6

Net Profit 12604.3 8043.7 13141.6 8676.5

Add: Surplus brought forward from previous year 19530.2 14647.9 21345.2 15946.1

Amount available for Appropriation 32134.5 22691.6 34486.8 24622.6

Appropriations:

Transfer to General Reserve 1500.0 1500.0 1500.0 1500.0

Add: Transfer from Minority Interest - - 280.6 -

Dividend on Equity Shares by an overseas subsidiary - - - 93.4

Proposed dividend on Equity Shares 1790.1 1429.2 1790.1 1429.2

Dividend on Equity Shares for previous year 0.9 0.3 0.9 0.3

Corporate tax on dividend 304.3 231.9 304.3 254.5

Balance carried to Balance Sheet 28539.2 19530.2 31172.1 21345.2

32134.5 22691.6 34486.8 24622.6

Performance Review

Your Company scaled newer heights and benchmarks in terms of sales and profits for the year ended March 31, 2013. Consolidated sales at H 95235.3 million grew by 36% over H 70017.2 million of the previous year. International markets accounted for 72% of sales. Profit before interest, depreciation and tax increased by 57% at H 22978.1 million as against H 14590.6 million in the previous year. Profit before tax was H 19246.0 million, higher by 61% over the previous year. After providing for taxes and minority interest, net profit was H 13141.6 million, higher by 51% over the previous year. Earning per share was H 29.39.

Dividend

Your Directors are pleased to recommend dividend at H 4/- per equity share of H 2/- each, absorbing an amount of H 1790.1 million. The corporate tax on proposed dividend aggregates H 304.3 million.

Share Capital

During the year, the paid-up equity share capital of your Company rose by H 1.8 million consequent to allotment of 887812 equity shares of H 2/- each to eligible employees under the ''Lupin Employees Stock Option Plan 2003'', ''Lupin Employees Stock Option Plan 2005'', ''Lupin Subsidiary Employees Stock Option Plan 2005'' and ''Lupin Employees Stock Option Plan 2011.''

Credit Rating

ICRA Limited reaffirmed its "[ICRA] A1 " (pronounced "ICRA A one plus") rating for your Company''s working capital lines of H 15000 million from banks indicating a very strong degree of safety for timely payment of financial obligations. Of this limit, H 1900 million was assigned a long-term rating of "[ICRA] AA " (pronounced "ICRA double A plus") indicating a high degree of safety for timely servicing of financial obligations.

The Company also enjoys "[ICRA] AA " rating for non- convertible debentures (NCDs) of H 1000 million, indicating a high degree of safety for timely servicing of financial obligations for long-term debt instruments. The Company did not issue any long-term NCDs during the year.

Subsidiary Companies

As on March 31, 2013, the Company had 19 subsidiaries. Lupin Middle East FZ-LLC, Dubai, wholly-owned subsidiary was incorporated on June 13, 2012. Since there was not much operation in Amel Touhoku, Japan, wholly-owned subsidiary of the Company, it was wound-up w.e.f. February 28, 2013. Financials of subsidiary companies are disclosed in the Consolidated Financial Statements which form part of this Annual Report. Statement pursuant to Section 212(1)(e) of the Companies Act, 1956 forms part of this Annual Report.

Management Discussion and Analysis

A detailed Management Discussion and Analysis forms part of this Annual Report.

Corporate Governance

Report on Corporate Governance forms an integral part of this Annual Report. The Auditors'' certificate certifying compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement is also annexed to this Report.

Business Responsibility Report

Pursuant to Clause 55 of the Listing Agreement with the Stock Exchanges, Business Responsibility Report forms part of this Annual Report.

Directors'' Responsibility Statement

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 (Act), your Directors confirm that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii) the Directors had 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 at the end of the financial year ended March 31, 2013 and of the profit of your Company for that year;

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

iv) the Directors had prepared the annual accounts on a ''going concern'' basis.

Directors

Dr. Kamal K. Sharma was re-appointed as Managing Director of the Company for a period of three years effective September 29, 2012 or other mutually agreed capacity. His re-appointment was approved by members; vide an ordinary resolution passed by postal ballot, the result of which was declared on December 13, 2012.

The Company, led by a strong senior management team, is poised to enter higher orbits of growth. In this direction, the Board of Directors at its meeting held on May 8, 2013 approved the elevation of Dr. Kamal K. Sharma as Vice Chairman, Ms. Vinita Gupta as Chief Executive Officer and Mr. Nilesh Gupta as Managing Director, effective September 1, 2013, on such terms and conditions as may be finalised and subject to necessary approvals as may be required.

Dr. Sharma has effectively led the team and as Vice Chairman, he would be involved in setting vision of the Company, building strategy and mentoring the management team. Ms. Vinita has built a strong presence in the US market which is the largest market of the Company. Mr. Nilesh Gupta has ably led the Company''s research and supply chain functions. Mr. Dileep C. Choksi, who was appointed as an Additional Director w.e.f. October 23, 2012, holds office up to the date of the forthcoming Annual General Meeting. Notices have been received from certain members proposing his name for appointment as a director.

Mr. D. K. Contractor stepped down from the directorship of the Company w.e.f. October 23, 2012 on health grounds. The Board records its sincere appreciation of the valuable contribution rendered by Mr. Contractor during his tenure as a director of the Company.

Dr. Kamal K. Sharma, Ms. Vinita Gupta and Mr. Nilesh Gupta retire by rotation at the forthcoming Annual General Meeting and are eligible for re-appointment.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as prescribed by Section 217(1 )(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in Annexure ''A''.

Fixed Deposits

Your Company has not accepted any fixed deposit during the year. No deposit was outstanding as on March 31, 2013. Seven deposits aggregating H 63,000/- were lying unclaimed with the Company, as on March 31, 2013, none of which, have since been claimed. Reminders have been sent to the concerned depositors to claim repayment of their matured deposits.

Auditors

Statutory Auditors of the Company, M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Audit Committee and the Board of Directors recommend their re-appointment as Statutory Auditors of your Company.

M/s. Khimji Kunverji & Co., Chartered Accountants, Mumbai, were the Internal Auditors of the Company during the year.

Cost Auditors

Pursuant to the provisions of Section 233B of the Companies Act, 1956, in terms of General Circular No.15/2011 dated April 11, 2011 and with the approval of the Central Government, Mr. S. D. Shenoy (Fellow Membership No.8318), practising Cost Accountant, was appointed to conduct audit of cost records of Bulk Drugs and Formulations for the year ended March 31, 2013. Cost Audit Report would be submitted to the Central Government within the prescribed time.

Pursuant to Rule 5 of the Companies (Cost Audit Report) Rules, 2011 and in terms of Circulars issued by the Cost Audit Branch of the Ministry of Corporate Affairs from time to time, the Cost Audit Report for Bulk Drugs and Formulations, for the year ended March 31, 2012 was filed with the Central Government on December 27, 2012, in the Extensible Business Reporting Language (XBRL) mode. The last date of filing the Cost Audit Report was February 28, 2013.

Employees Stock Appreciation Rights / Stock Options

During the year, ''Lupin Employees Benefit Trust'', of which, ''Barclays Wealth Trustees (India) Private Limited'' are independent trustee, acquired 446154 fully paid-up equity shares of the face value of H 2/- each under ''Lupin Employees Stock Appreciation Rights Scheme 2011''.

Pursuant to the provisions of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, the details of stock options granted by the Company during the year under ''Lupin Employees Stock Option Plan 2005'', ''Lupin Employees Stock Option Plan 2011'' and ''Lupin Subsidiary Companies Employees Stock Option Plan 2011''are set out in Annexure ''B'' forming part of this Report.

Human Resources

The Company was ranked as ''India''s Best Company to Work for - 2012'' in the Biotech and Pharma Sector, by the ''Great Places to Work Institute®'' and The Economic Times, in their annual cross-industry study called Best Companies to Work for. This recognition is a true testimony and a joyous reflection of the pride of employees, superior people practices and overall employee orientation. The Company firmly believes that employees are the most vital assets and key differentiators of business success. In order to enhance the efficiency and effectiveness, the Company instituted several people-friendly policies and people-development programs, across all levels, to enthuse a vibrant work culture and ensure that the workforce remains invigorated and motivated.

Particulars of Employees

Particulars of employees required to be furnished pursuant to the provisions of Section 217(2A) of the Companies Act, 1956 (Act), read with Companies (Particulars of Employees) Amendment Rules, 2011, are given as an annexure to this Report. However, pursuant to the provisions of Section 219(1) (b)(iv) of the Act, the Report and Accounts are being sent to all the members excluding the aforesaid Annexure. Members, who are interested in the information, may write to the Company Secretary at the registered office of the Company.

Acknowledgements

Your Directors commend the commitment, hardwork, dedication and contributions of employees across the Company. They express gratitude to the various departments of Central and State governments, banks, financial institutions, customers, medical professionals, distributors, business associates, suppliers, shareholders and analysts, for their continued support.

For and on behalf of the Board of Directors

Dr. Desh Bandhu Gupta

Chairman

Mumbai, May 8, 2013


Mar 31, 2012

The Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2012.

Financial Results

(Rs in million)

Standalone Consolidated 2011-12 2010-11 2011-12 2010-11

Sales (Gross) 53579.1 44616.0 70017.2 57421.7

Profit before interest, depreciation and tax 11653.5 9755.3 14590.6 12000.3

Less: Interest and finance charges 286.8 275.7 354.7 344.8

Less: Depreciation and amortisation 1319.6 1042.8 2275.2 1711.8

Profit before tax 10047.1 8436.8 11960.7 9943.7

Less: Provision for taxation (including deferred tax) 2003.4 337.0 3085.6 1149.8

Net Profit before Minority Interest and Share of loss in Associate - - 8875.1 8793.9

Less: Minority Interest and Share of loss in Associate - - 198.6 168.4

Net Profit 8043.7 8099.8 8676.5 8625.5

Add: Surplus brought forward from previous year 14647.9 9945.1 15946.1 10521.8

Less: Adjustment on account of amalgamation of subsidiaries - 338.9 - 43.6

Amount available for Appropriation 22691.6 17706.0 24622.6 19103.7

Appropriations:

Transfer to General Reserve 1500.0 1500.0 1500.0 1500.0

Dividend on Equity Shares by an overseas subsidiary - - 93.4 80.6

Proposed dividend on Equity Shares 1429.2 1338.6 1429.2 1338.6

Dividend on Equity Shares for previous year 0.3 2.0 0.3 2.0

Corporate tax on dividend 231.9 217.5 254.5 236.4

Balance carried to Balance Sheet 19530.2 14647.9 21345.2 15946.1

22691.6 17706.0 24622.6 19103.7

Performance Review

During the year, your Company's turnover crossed Rs 70,000 million, with Consolidated Gross Sales clocking Rs 70017.2 million as against Rs 57421.7 million of the previous year, higher by 22%. International markets accounted for 69% of sales. Profit before interest, depreciation and tax also increased by 22% at Rs 14590.6 million as against Rs 12000.3 million in the previous year. The Company achieved PBT of Rs 11960.7 million, higher by 20%. After providing for taxes and minority interest, the net profit was at Rs 8676.5 million. Provision for tax was higher mainly on account of withdrawal of Income tax benefits for EOU units, effective April 1, 2011. Earning per share was Rs 19.43.

Dividend

Your Directors are pleased to recommend dividend at Rs 3.20 per equity share of Rs 2/- each, absorbing an amount ofRs 1429.2 million. The corporate tax on proposed dividend aggregates Rs 231.9 million.

Share Capital

During the year, the paid-up equity share capital of your Company rose by Rs 0.9 million consequent to allotment of 440492 equity shares of Rs 2/- each to eligible employees under the 'Lupin Employees Stock Option Plan 2003', 'Lupin Employees Stock Option Plan 2005' and 'Lupin Subsidiary Employees Stock Option Plan 2005'.

Credit Rating

ICRA Limited reaffirmed its "A1 " (pronounced "A one plus") rating for your Company's working capital lines of Rs 11000 million from banks. This rating is the highest-credit-quality rating by ICRA for such borrowings.

The Company also enjoys "LAA " (pronounced "L double A plus") rating from ICRA for non-convertible debentures (NCDs) of Rs 1000 million. This rating is the high-credit-quality rating for long-term debt instruments. However during the year, the Company has not issued any long-term NCDs.

Acquisition

In its strategy to pursue inorganic growth for further accelerating its progress and expanding its presence in select geographies, your Company's wholly-owned subsidiary Kyowa Pharmaceutical Industry Co., Ltd., Japan acquired 99.99% stake in I'rom Pharmaceutical Co., Ltd., (IP), Japan. IP specialises in manufacturing and marketing of infusion and other injectable pharmaceutical products. It is one of the few companies in Japan with bag (Infusion) manufacturing infrastructure with support from major wholesalers and relationship with Innovator companies. The Company believes that acquisition of IP would help focussing on in-house products and upgrading marketing and sales functions in the important market of Japan.

Subsidiary Companies

As on March 31, 2012, the Company had 19 subsidiaries. Generic Health SDN. BHD., Malaysia, wholly - owned subsidiary was incorporated on May 18, 2011. Since there was no operation in Generic Health Inc., U.S.A., the said company was wound up with effect from October 4, 2011.

Statement pursuant to Section 212(1)(e) of the Companies Act, 1956 forms part of this Annual Report. Information pertaining to performance/financials of subsidiary companies is disclosed in the Consolidated Financial Statements.

Management Discussion & Analysis

A detailed Management Discussion and Analysis forms part of this Annual Report.

Corporate Governance

Report on Corporate Governance forms an integral part of this Annual Report. The Auditors' certificate certifying compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement is also annexed to this Report.

Directors' Responsibility Statement

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 (Act), your Directors confirm that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii) the Directors had 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 at the end of the financial year ended March 31, 2012 and of the profit of your Company for that year;

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

iv) the Directors had prepared the annual accounts on a 'going concern' basis.

Directors

Due to professional commitments, Mr. K. V. Kamath chose to step down from the directorship of the Company w.e.f. November 9, 2011. The Board records its sincere appreciation of the valuable contribution and learned advice rendered by Mr. Kamath during his tenure as a director of the Company.

Dr. Vijay Kelkar, Mr. Richard Zahn and Mr. R. A. Shah retire by rotation at the forthcoming Annual General Meeting and are eligible for re-appointment.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as prescribed by Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in Annexure 'A'.

Fixed Deposits

Your Company has not accepted any fixed deposit during the year under review and no deposit was outstanding as on March 31, 2012. As on March 31, 2012, 50 deposits aggregating Rs 0.5 million were lying unclaimed with the Company, of which three deposits aggregating Rs 31,000/- have since been claimed. Reminders are continuously sent to the depositors concerned to claim repayment of their matured deposits.

Auditors

The Statutory Auditors of the Company, M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Audit Committee and the Board recommend the re-appointment of M/s. Deloitte Haskins & Sells, Chartered Accountants, as Statutory Auditors of your Company.

M/s. Khimji Kunverji & Co., Chartered Accountants, Mumbai, are the Internal Auditors of the Company.

Cost Auditors

Pursuant to the provisions of Section 233B of the Companies Act, 1956 and in terms of General Circular No.15/2011 dated April 11, 2011 and with the prior approval of the Central Government, Mr. S. D. Shenoy (Fellow Membership No.8318) practising Cost Accountant, was appointed to conduct audit of cost records of Bulk Drugs and Formulations for the year ended March 31, 2012. Cost audit reports would be submitted to the Central Government within the prescribed time.

Pursuant to Rule 5 of the Companies (Cost Audit Report) Rules, 2011, cost audit reports for Bulk Drugs and Formulations for the year ended March 31, 2011 were filed with the Central Government on September 27, 2011.

Employees Stock Appreciation Rights/Stock Options

During the year, 'Lupin Employees Stock Appreciation Rights Scheme 2011' ('LESAR') was introduced for senior executives of the Company with an object to attract, retain and motivate talent in the Company as also to enable them to participate in the long-term growth and financial success of the Company. 'Lupin Employees Benefit Trust' was formed and 'Barclays Wealth Trustees (India) Private Limited' were appointed as independent trustee for implementing the said Scheme. Under LESAR, eligible employees are entitled to receive appreciation in value of shares of the Company upon completion of vesting period of three years. During the year, the Trust acquired 463425 shares under the Scheme.

During the year, the Company also introduced 'Lupin Employees Stock Option Plan 2011' and 'Lupin Subsidiary Companies Employees Stock Option Plan 2011' for grant of stock options to eligible employees as approved by the Remuneration Committee. Pursuant to the provisions of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, the details of stock options granted by the Company during the year under different plans are set out in Annexure 'B' forming part of this Report.

Human Resources

Your Company firmly believes that people are its most valued resource and their efficiency plays a key role in achieving defined goals and building a competitive work environment. In its pursuit to attract, retain and develop best available talents, several programmes are regularly conducted at various levels across the Company. Employee relations continued to be cordial and harmonious across all levels and all the units of the Company.

Particulars of Employees

Particulars of employees required to be furnished pursuant to the provisions of Section 217(2A) of the Companies Act, 1956 (Act), read with Companies (Particulars of Employees) Amendment Rules, 2011, are given as an annexure to this Report. However, pursuant to the provisions of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to all the members excluding the aforesaid Annexure. Members, who are interested in the information, may write to the Company Secretary at the registered office of the Company.

Acknowledgements

Your Directors express their gratitude to the various departments of the central and state governments, customers, business associates, medical professionals, suppliers, distributors, shareholders, analysts, banks and financial institutions for their continued support as also to all employees of the Company for their efforts, commitment, dedication and contributions.

For and on behalf of the Board of Directors

Dr. Desh Bandhu Gupta

Chairman

Mumbai, May 10, 2012


Mar 31, 2011

The Directors have pleasure in presenting their report on the business and operations of your Company for the year ended March 31, 2011.

Financial Results

(Rs. in million)

Standalone Consolidated

2010-11 2009-10 2010-11 2009-10

Sales (Gross) 44616.0 36990.2 57421.7 48009.5

Proft before interest, depreciation and tax 9756.0 8186.1 11999.6 9980.9

Less: Interest and fnance charges 256.9 283.8 324.6 384.9

Less: Depreciation and amortisation 1042.8 815.7 1711.8 1239.1

Proft before tax 8456.3 7086.6 9963.2 8356.9

Less: Provision for taxation (including wealth tax, deferred tax and fringe beneft tax) 356.5 597.3 1169.3 1360.2

Net Proft before Minority Interest and Share of loss in Associates - - 8793.9 6996.7

Less: Minority Interest and Share of loss in Associates - - 168.4 180.4

Net Proft 8099.8 6489.3 8625.5 6816.3

Add: Surplus brought forward from previous year 9945.1 6368.5 10521.8 6688.6

Less: Adjustment on account of amalgamation of subsidiaries 338.9 - - -

Less: Adjustment on account of amortisation of goodwill for previous year - - 43.6 -

Amount available for Appropriation 17706.0 12857.8 19103.7 13504.9 Appropriations:

Transfer to General Reserve 1500.0 1500.0 1500.0 1500.0

Dividend on Ordinary Shares by an overseas subsidiary - - 80.6 60.6

Proposed dividend on Equity Shares 1338.6 1200.7 1338.6 1200.7

Dividend on Equity Shares for previous year 2.0 10.8 2.0 10.8

Corporate tax on dividend 217.5 201.2 236.4 211.0

Balance carried to Balance Sheet 14647.9 9945.1 15946.1 10521.8

17706.0 12857.8 19103.7 13504.9

Performance Review

Your Company recorded an impressive growth by scaling newer heights and benchmarks in terms of sales and profits for the year ended March 31, 2011. Consolidated sales at Rs. 57421.7 million, were higher by 20% over Rs. 48009.5 million of the previous year. International markets accounted for 68% of the overall revenues. Net Proft at Rs. 8625.5 million as against Rs. 6816.3 million registered a growth of 27%. Earnings per share was higher at Rs. 19.36 as compared with Rs. 15.84 for the previous year.

Dividend

Your Directors are pleased to recommend dividend at Rs. 3/- per equity share of Rs. 2/- each, absorbing an amount of Rs. 1338.6 million. The corporate tax on dividend aggregates Rs. 217.2 million.

Sub-division of Shares

At the Twenty-Eighth Annual General Meeting held on July 28, 2010, the Shareholders approved the sub-division of one equity share of the face value of Rs. 10/- each into fve equity shares of the face value of Rs. 2/- each.

Share Capital

During the year, the paid-up equity share capital of your Company rose by Rs. 3.0 million consequent to:

a) allotment of 170691 equity shares of Rs. 10/- each to eligible employees under the Lupin Employees Stock Option Plan 2003, Lupin Employees Stock Option Plan 2005 and Lupin Subsidiary Employees Stock Option Plan 2005 prior to sub-division and

b) allotment of 628569 equity shares of Rs. 2/- each to eligible employees under the Lupin Employees Stock Option Plan 2003, Lupin Employees Stock Option Plan 2005 and Lupin Subsidiary Employees Stock Option Plan 2005 after sub-division.

Credit Rating

ICRA Limited reaffrmed its “A1+” (pronounced “A one plus”) rating for your Companys short-term debt (including Commercial Paper) programme of Rs. 1000 million. This rating is the highest-credit- quality rating assigned by ICRA for such borrowings.

ICRA Limited reaffrmed its “A1+” (pronounced “A one plus”) rating for your Companys Line of Credit of Rs. 11000 million by banks for Working Capital. This rating is the highest-credit-quality rating assigned by ICRA for such borrowings.

ICRA Limited assigned “LAA+” (pronounced “L Double A Plus”) rating for your Companys Non-Convertible Debenture programme of Rs. 1000 million. This rating is the high-credit-quality rating assigned by ICRA for long-term debt instruments. The long-term rating has also been assigned a “stable” outlook.

Management Discussion & Analysis

A detailed Management Discussion and Analysis forms part of this Annual Report.

Subsidiary Companies

As on March 31, 2011, the Company had 18 subsidiaries.

Lupin Mexico SA de CV, Mexico was incorporated on August 23, 2010. Upon increase in the Companys stake in Generic Health Pty Ltd., (Generic), Australia, from 49.91% to 76.65%, Generic became a subsidiary of the Company on September 27, 2010. Consequently, Bellwether Pharma Pty Ltd., Australia, Generic Health Inc., U.S.A. and Max Pharma Pty Ltd., Australia, which were subsidiaries of Generic, became subsidiaries of the Company w.e.f. September 27, 2010. Lupin Philippines, Inc., Philippines and Lupin Healthcare Ltd., India, were incorporated on December 20, 2010 and March 17, 2011 respectively.

Information relating to performance/financials of the subsidiary companies are disclosed in the Consolidated Financial Statements. Statement pursuant to Section 212(1)(e) of the Companies Act, 1956 forms part of this Annual Report.

Amalgamation

With a view to achieving synergies of operations, optimum utilisation of resources and control costs, the Board of Directors had decided to amalgamate Novodigm Ltd., Lupin Pharmacare Ltd. and Lupin Herbal Ltd. (wholly-owned subsidiaries of the Company) with the Company w.e.f. April 1, 2009 i.e. the Appointed Date.

The Honble High Court of Judicature at Bombay had, vide its Order dated January 8, 2010, sanctioned the scheme of amalgamation between Lupin Pharmacare Ltd. and Lupin Herbal Ltd. with the Company subject to the order to be passed by the Honble High Court of Gujarat sanctioning the scheme of amalgamation between Novodigm Ltd. and the Company. The Honble

High Court of Gujarat, vide its Order dated May 6, 2010, sanctioned the scheme of amalgamation between Novodigm Ltd. and the Company. Consequently, Novodigm Ltd., Lupin Pharmacare Ltd. and Lupin Herbal Ltd. stood amalgamated with the Company w.e.f. April 1, 2009.

Corporate Governance

Report on Corporate Governance forms an integral part of this Annual Report. The Auditors certifcate certifying compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement is also annexed to this Report.

Directors Responsibility Statement

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 (Act), your Directors confrm that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii) the Directors had 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 at the end of the financial year ended March 31, 2011 and of the proft of your Company for that year;

iii) the Directors had taken proper and suffcient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities; and

iv) the Directors had prepared the annual accounts on a going concern basis.

Directors

Mr. Nilesh Gupta and Dr. K. U. Mada retire by rotation at the forthcoming Annual General Meeting and are eligible for re-appointment.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The particulars as prescribed by Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in Annexure A.

Fixed Deposits

Your Company has not accepted any fxed deposit during the year under review. No deposit was outstanding as on March 31, 2011. As on March 31, 2011, 76 deposits aggregating Rs. 0.8 million were lying unclaimed with the Company, of which four deposits aggregating Rs. 81,000/- have since been claimed/transferred to the Investor Education & Protection Fund. Reminders have been sent to the depositors concerned to claim repayment of their matured deposits.

Auditors

The Statutory Auditors of the Company, M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Audit Committee and the Board recommend the re-appointment of M/s. Deloitte Haskins & Sells, Chartered Accountants, as Statutory Auditors of your Company.

M/s. Khimji Kunverji & Co., Chartered Accountants, Mumbai, are the Internal Auditors of the Company.

Cost Auditors

Pursuant to the provisions of Section 233B of the Companies Act, 1956 and with the prior approval of the Central Government, Mr. S. D. Shenoy (Fellow Membership No.8318) and Mr. D. H. Zaveri, (Fellow Membership No.8971) practising Cost Accountants, were appointed to conduct audit of cost records of Bulk Drugs and Finished Dosages respectively for the year ended March 31, 2011. Cost Audit Reports would be submitted to the Central Government within the prescribed time.

Pursuant to Rule 5 of the Cost Audit Report Rules, Cost Audit Reports for Bulk Drugs and Finished Dosages for the year ended March 31, 2010 were fled with the Central Government on September 26, 2010.

Employees Stock Option Plans

Pursuant to the provisions of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, the details of stock options granted by the Company as on March 31, 2011 under Lupin Employees Stock Option Plan 2003, Lupin Employees Stock Option Plan 2005 and Lupin Subsidiary Companies Employees Stock Option Plan 2005 are set out in Annexure B forming part of this Report.

During the year, the Board of Directors approved the Lupin Employees Stock Option Plan 2011 and Lupin Subsidiary Companies Employees Stock Option Plan 2011. Shareholder approvals for these plans were obtained by way of Postal Ballot, the results of which were declared on May 10, 2011.

The Board also approved the Employees Stock Purchase Programme and Stock Appreciation Rights Programme for senior executives of the Company, the details of which are being worked out.

Human Resources

Great Places to Work Institute Inc. has ranked the Company amongst the Top 3 as a great place to work in pharma/healthcare companies in India. Your Company is of the frm opinion that effciency of its employees plays a key role in achieving set goals and building a competitive work environment. The Company regularly conducts various programmes at different levels so as to ensure that a vibrant and motivated work-force leads to achievement of the defned goals. Employee relations continued to be harmonious and cordial at all levels and in all the units of the Company.

Particulars of Employees

Particulars of employees required to be furnished pursuant to the provisions of Section 217(2A) of the Companies Act, 1956 (Act), read with Companies (Particulars of Employees) Amendment Rules, 2011, are given as an annexure to this Report. However, pursuant to the provisions of Section 219(1)(b)(iv) of the Act, the Report and Accounts are being sent to all the members excluding the aforesaid Annexure. Members, who are interested in the information, may write to the Company Secretary at the registered offce of the Company.

Acknowledgements

Your Directors commend the hard work, dedication and contributions of all employees of your Company. They express their gratitude to the various departments of the Central and State governments, banks, financial institutions, analysts, investors, business associates and customers, the medical profession, suppliers and distributors for their continued support.

For and on behalf of the Board of Directors

Dr. Desh Bandhu Gupta Chairman

Mumbai, May 12, 2011


Mar 31, 2010

The Directors have pleasure in presenting their report on the business and operations of your Company for theyearendedMarch31,2010.

Financial results (Rs. in million)

Standalone Consolidated

2009-10 2008-09 2009-10 2008-09

Sales (Gross) 36660.6 29419.4 47678.4 38237.8

Profit before interest, depreciation and tax 8186.1 5792.5 9981.0 7438.9

Less: Interest and finance charges 283.8 415.2 384.9 498.6

Less: Depreciation and amortisation 815.7 663.5 1239.2 879.9

Profit before tax 7086.6 4713.8 8356.9 6060.4

Less: Provision for taxation (including wealth tax, deferred tax and fringe benefit tax) 597.3 544.1 1360.2 983.0

Net Profit before Minority Interest and Share of loss in Associates - - 6996.7 5077.4

Less: Minority Interest and Share of loss in Associates - - 180.4 62.0

Net Profit 6489.3 4169.7 6816.3 5015.4

Add: Surplus brought forward from previous year 6368.5 4910.1 6688.6 4407.8

Amount available for Appropriation 12857.8 9079.8 13504.9 9423.2

Appropriations:

Transfer to General Reserve 1500.0 1500.0 1500.0 1500.0

Dividend on Ordinary Shares by an Overseas Subsidiary - - 36.6 21.2

Proposed dividend on Equity Shares 1200.7 1035.3 1224.7 1035.3

Dividend on Equity Shares for previous year 10.8 0.1 10.8 0.1

Corporate tax on dividend 201.2 175.9 211.0 178.0

Balance carried to Balance Sheet 9945.1 6368.5 10521.8 6688.6

12857.8 9079.8 13504.9 9423.2

Performance Review

YourCompanyscalednewerheightsandbenchmarksintermsofsalesand profits fbrtheyearendedMarch31, 2010. Consolidated sales at Rs.47678.4 mn., grew by 25% over Rs.38237.8 mn. of the previous year. International markets accounted for 67% of the revenues. Net Profit at Rs.6816.3 mn. as against Rs.5015.4 mn., registered a growth of 36%. Earning per share was higher at Rs.79.18 as compared with Rs.60.84 for the previousyear.

Dividend

Your Directors are pleased to recommend dividend of Rs.13.50 per equity share of Rs.10/- each, absorbing an amount ofRs.1400.1 mn.,inclusiveoftaxondividend.

Share Capital

During theyear,thepaid-upequity share capital ofyour Company rose by Rs.61.2mn.consequentto:-

a) allotment of 5816742 equity shares of Rs.10V- each upon conversion of Foreign Currency Convertible BondsaggregatingUS$71.3mn.and

b) allotmentof307541equitysharesofRs.10/-eachtoeligibleemployeesunderthe lupin Employees Stock Option Plan 2003, lupin Employees Stock Option Plan 2005 and lupin Subsidiary Employees Stock Option Plan 2005.

Sub-division of Shares

The Board of Directors is pleased to recommend the sub-division of one share of the face value of Rs.10/- each into five shares of the face value of Rs.2/- each, subject to approval of shareholders at the forthcoming Annual General Meeting.

Foreign Currency Convertible Bonds (FCCBs)

Of the FCCBs of US $ 100 mn. issued by the Company in January 2006, Bonds aggregating US $ 98.6 mn. were converted (including Bonds of US $ 71.3 mn. during the year) at a pre-determined price of Rs.567.04 per share in accordance with the terms of the issue. The balance FCCBs for US $ 1.4 mn. were redeemed during the year. There are no Bonds outstanding as on March 31,2010.

Credit Rating

ICRA Limited reaffirmed its "A1+" (pronounced A one plus) rating for your Companys short-term debt (including Commercial Paper) programme of Rs.2500 mn. This rating is the highest-credit-quality rating assigned by ICRAforsuch borrowings.

ICRA Limited assigned "LAA+" (pronounced "L Double A Plus") rating for your Companys Non Convertible Debenture programme of Rs.5000 mn. This rating is the high-credit-quality rating assigned by ICRA for long-term debt instruments.

Management Discussion & Analysis

AdetailedManagementDiscussionandAnalysisforms part ofthis Annual Report.

Subsidiary Companies

As on March 31,2010, the Company had 14 subsidiaries.

During the year, Lupin (Europe) Ltd., U.K. and Lupin Pharma Canada Ltd., Canada were incorporated on June 5, 2009 and June 18, 2009 respectively. Lupin Holdings B.V., the Netherlands transferred its holdings in Max Pharma Pty Ltd., Australia, a wholly-owned subsidiary of the Company to Generic Health Pty. Ltd., Australia, an associate of the Company upon which Max Pharma Pty Ltd. ceased to be a subsidiary of the Company w.e.f. May 31,2009.

Statements pursuant to Section 212 (1 )(e) of the Companies Act, 1956 and relating to performance/financials ofthesubsidiarycompaniesform part ofthis Annual Report.

Amalgamation

With a view to achieving synergies of operations, optimum utilisation of resources and control costs, the Board of Directors decided to amalgamate Novodigm Ltd., Lupin Pharmacare Ltd. and Lupin Herbal Ltd. (wholly- owned subsidiaries of the Company) with Lupin Limited w.e.f. April 1,2009 i.e. the Appointed Date.

The Honble High Court of Judicature at Bombay, by its Order dated January 8,2010, sanctioned the scheme of amalgamation between Lupin Pharmacare Ltd. and Lupin Herbal Ltd. with the Company subject to the order to be passed by the High Court of Gujarat sanctioning the scheme of amalgamation between Novodigm Ltd. and the Company. The order of the Gujarat High Court is awaited pending which, the standalone accounts of the Company for theyear ended March 31,2010 do not include financials of Novodigm Ltd., Lupin Pharmacare Ltd.and Lupin Herbal Ltd.

Corporate Governance

Report on Corporate Governance forms an integral part of this Annual Report. The Auditors certificate certifying compliance with the conditions of Corporate Governance under Clause 49 of the Listing Agreement isalsoannexedtothisReport.

DirectorsResponsibilityStatement

Pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 (Act),your Directors confirm that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with properexplanation relating to material departures;

ii) the Directors had 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 at the end of the financial year ended March 31,2010 and of the profit of your Companyforthatyear;

iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions ofthe Act forsafeguardingtheassetsofyourCompanyandfor preventing and detecting fraud and other irregularities;and

iv) the Directors had prepared the annual accounts on a going concern basis.

Directors

Mr. K. V. Kamath, Dr. Vijay Kelkar and Mr. Richard Zahn, who were appointed as Additional Directors w.e.f. January 29, 2010, hold office up to the date ofthe forthcoming Annual General Meeting. Notices have been received from certain shareholders proposing their names forappointment as directors.

Due to professional commitments, Mr. Marc Desaedeleer and Mr. Sunil Nair resigned from the directorship of the Company w.e.f. January 29,2010 and May 5,2010 respectively. The Board records its sincere appreciation for the valuable contributions made by Mr.MarcDesaedeleer and Mr.Sunil Nair during their tenure as directors ofthe Company.

Dr. Kamal K. Sharma and Mr. D. K. Contractor retire by rotation at the forthcoming Annual General Meeting and areeligibleforre-appointment.

Conservation of Energy,Technology Absorptionand Foreign Exchange Earnings and Outgo

The particulars as prescribed by Section 217(1 )(e) ofthe Companies Act, 1956 read with Companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988 relating to conservation of energy, technology absorption and foreign exchange earnings and outgo are given in Annexure A.

Fixed Deposits

Your Company has not accepted any fixed deposit during the year under review. No deposit was outstanding as on March 31,2010. As on March 31,2010,106 deposits aggregating Rs.1.18 mn. were lying unclaimed with the Company, of which four deposits aggregating Rs.20,000/- have since been claimed. Reminders are continuously sent to the depositors concerned to claim repayment of the irmatured deposits.

Auditors

The Statutory Auditors of the Company, M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the conclusion of the forthcoming Annual General Meeting and are eligible for re-appointment. The Audit Committee and the Board recommend the re-appointment of M/s. Deloitte Haskins & Sells, Chartered Accountants,asStatutory Auditors of your Company.

M/s. KhimjiKunverji& Co., Chartered Accountants, Mumbai, are the Internal Auditors ofthe Company.

Cost Auditors

Pursuant to the provisions of Section 233B of the Companies Act, 1956 and with the prior approval of the Central Government, Mr. S. D. Shenoy and Mr. D. H. Zaveri, practising Cost Accountants, were appointed to conduct audit of cost records of Bulk Drugs and Finished Dosages respectively. Cost Audit Reports would be submitted to theCentralGovernmentwithin the prescribed time.

Employees StockOption Plans

Pursuant to the provisions ofthe Securities and Exchange Board of India (Employee StockOption Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, the details of stock options granted by the Company as on March 31,2010 under lupin Employees StockOption Plan 2003, lupin Employees StockOption Plan 2005 and lupin Subsidiary Companies Employees Stock Option Plan 2005 are set out in Annexure B forming part of this Report.

Human Resources

Your Company remains committed and focused on its most valuable resource viz. people. The Company believes that people play a pivotal role in driving performance and has effectively empowered them. In pursuance of the Companys commitment to retain and develop best available talents, several programmes are conducted at various levels on a regular basis. Employee relations continued to be cordial and harmonious at all levels and in all the units of the Company.

ParticularsofEmployees

Particulars of employees required to be furnished pursuant to the provisions of Section 217(2A) of the Companies Act, 1956 (Act), read with Companies (Particulars of Employees) (Amendment) Rules, 2002, are given as an annexure to this Report. However, as per the provisions of Section 219(1 )(b)(iv) of the Act, the Report and Accounts are being sent to all the members excluding the aforesaid annexure. Members, who are interestedinthesaidinformation,maywritetotheCompanySecretaryatthe registered office of the Company.

Acknowledgements

Your Directors wish to express their gratitude to the Central and State governments, investors, analysts, financial institutions, banks, business associates and customers, the medical profession, distributors and suppliers for their whole-hearted support. Your Directors commend all employees of your Company for their continued dedication, significant contributions, hard workand commitment.

For and on behalf of the Board of Directors

Dr. DeshBandhu Gupta Chairman

Mumbai,May 5,2010

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