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Notes to Accounts of Eris Lifesciences Ltd.

Mar 31, 2023

3.1 Details of pledged securities:

Include '' Nil million (31-03-2022 - ''350.00 million) marked under lien against overdraft facilities availed by the company.

3.2 Details of perpetual securities:

In the financial year 2018-19, the company has invested in unsecured subordinated perpetual securities issued by Aprica Healthcare Limited , its subsidiary company. These securities are redeemable at the issuer''s option and carry non-cumulative interest coupon at the rate of dividend paid on the issuer''s ordinary shares. No interest will be payable if the issuer does not pay any dividend on its ordinary shares for the Financial Year. The issuer has classified these instruments as equity under Ind AS 32 Financial Instruments presentation. Accordingly, the Company has classified this investment as Equity Instrument and has accounted at cost as per Ind AS 27 Separate Financial Statements.

3.3 Lock in period for Eris M. J. Biopharm Private Limited (Formerly Known as Kinedex Healthcare Private Limited)

As per share purchase & shareholders agreement, For a period of 10 (ten) years , Eris Lifesciences Limited and M.J. Biopharm Private Limited shall not, directly or indirectly, transfer or attempt to transfer all or any of the Equity Shares (or any interest therein) held by it to any Person.

3.4 The networth of this subsidiary is less than the total exposure of the Company in the said subsidiary as at March 31, 2023. However in view of the strategic nature of the investment in this Company and also considering the future business plans and cash flow projections of the Company the same is valued at cost and no impairment allowance is required to be provided for.

11.4 Terms / Rights attached to the equity shares:

The Company has only one class of equity shares having a par value of ''1 per share. Each holder of equity share is eligible for one vote per share. The final dividend, if any, proposed by the Board of Directors of the Company is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

11.5 Share options granted under the Company''s employee share option plan:

The Company recognizes compensation expense relating to share-based payments in statement of profit and loss using fair value in accordance with Ind AS 102, share based payment. The estimated fair value of awards is charged to income on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was insubstance multiple awards with a corresponding increase to share options outstanding account.

Provision for sales returns :

The Company, as a trade practice, accepts returns from market which are primarily in the nature of expired or near expiry products. Provision is made for such returns on the basis of historical experience, market conditions and specific contractual terms.

At the time of recognising provision for sales return expected reimbursement towards likely sales return is also recognied, which is included in other current assets for the products expected to be returned.

Note 26: Segment reporting

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (CODM), in deciding how to allocate resources and assessing performance. The Company''s chief operating decision maker is the managing director and the company has only one reportable business segment i.e. ''pharmaceuticals''.

Note 27 : Mergers And Acquisition

Note 27.1 : Acquisition of Eris Oaknet Healthcare Private Limited (Formerly known as Oaknet Healthcare Private Limited )

During the year, the Company has completed acquisition of 100% stake in Eris Oaknet Healthcare Private Limited (formerly known as Oaknet Healthcare Private Limited) and obtained control on May 12, 2022 from its erstwhile shareholders for a consideration of '' 6,554.90 Million (including transaction cost).

Eris Oaknet Healthcare Private Limited (formerly known as Oaknet Healthcare Private Limited) business predominantly comprised of brands in Dermatology and Women''s Health segments. The acquisition will provide robust growth platform in the areas of Dermatoloy and Cosmetology.

The Company has acquired 18,40,52,259 equity shares and 32 preference shares of Eris Oaknet Healthcare Private Limited at an average rate of ''35.32 each to make it 100% subsidiary company..

Note 27.2 : Amalgamation and Demerger of subsidiary companies

During the Financial Year 2022-23, on December 23, 2022 Honorable National Company Law Tribunal has approved the scheme of arrangement ("the Scheme") under section 230 and 232 of the Companies Act, 2013. Pursuant to the Scheme, one of the divisions of Eris Healthcare Private Limited (EHPL) - a wholly owned subsidiary of Eris Lifesciences Limited (the "Company") as represented by certain brands and related assets and liabilities (the Acquired Business) is demerged and merged into Aprica Healthcare Limited (AHL) - a wholly owned subsidiary of the Company with effect from April 1, 2021.

In consideration of the demerger of Acquired Business of and vesting of EHPL with and into AHL and in terms of the Scheme, AHL has issued and alloted to the equity shareholders of EHPL i.e. the Company, Equity Shares of face value Rs. 10 each credited as fully paid up of AHL in the ratio of 1 Equity Share of the face value of Rs. 10 each of AHL for every 2 equity shares of Rs. 10 credited as fully paid-up held by the Company in EHPL before capital reduction.

Note 27.3 : Acquisition of Brands of Dr. Reddy''s Laboratories Limited

During the year, the Company has completed acquisition of 9 brands of Dr. Reddy''s Laboratories Limited for a consideration of '' 2,750 Million.

Note 28: Employee Benefit Plans

A) Defined contribution plans:

The Company makes contributions towards provident fund, a defined contribution retirement benefit plan for qualifying employees. The provident fund is operated by the Regional Provident Fund Commissioner. The Company recognized ''81.56 million (Previous Year ''75.83 million) for provident fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

The Company made contributions towards Employees State Insurance Scheme operated by the ESIC Corporation. The Company recognized ''2.40 million (Previous year ''2.89 million) for ESIC contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

B) Defined benefit plans:

Actuarial Valuation for Compensated Absences is done as at the year end and the provision is made as per Company rules with

corresponding charge to the Statement of Profit and Loss amounting to ''15.95 million (Previous Year ''11.71 million) and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation.

The company makes annual contributions to the Employee''s Group Gratuity cash accumulation scheme of the Life Insurance Corporation of India, a funded defined benefit plan for qualifying employees. The Scheme provides for payment to vested employees at retirement/death while in employment or on termination of employment as per the provisions of the Gratuity Act, 1972. Vesting occurs on completion of 4.6 years of service. The present value of the defined benefit obligation and the related current service cost are measured using the Projected Unit Credit Method as per actuarial valuation carried out at the balance sheet date. The following table sets out the status of the gratuity plan as required under IND AS-19 and the amounts recognized in the Company''s financial statements as at March 31, 2023:

Notes:

1. The plan assets which are managed by Insurance Company viz Life Insurance Corporation of India, details of those funds invested by the insurer are not available with company.

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

3. Expected rate of return on plan assets is determined based on the nature of assets and prevailing economic scenario.

4. The estimate of future salary increases considered, takes into account inflation, seniority, promotion, increments and other relevant factors.

5. The expected contribution to be made by company for gratuity during financial year ending March 31, 2024 is ''27.19 million (previous year ''17.28 million).

(ii) Fair value hierarchy :

Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three levels of a fair value hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data rely as little as possible on entity specific estimates.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

Determination of fair values:

The following are the basis of assumptions used to estimate the fair value of financial assets and liabilities that are measured at fair value on recurring basis :

Investment in mutual funds : The fair values represent net asset value as stated by the issuers of these mutual fund units in the published statements. Net asset values represent the price at which the issuer will issue further units in the mutual fund and the price at which issuers will redeem such units from the investors.

Equity investments : Fair value of Equity investments traded in an active market are determined by reference to their quoted market prices. Other equity investments where quoted prices are not available, fair values are determined by reference to the current market value of net assets or relied upon on valuation report of an valuer.

(iii) Financial risk management :

The Company''s activities are exposed to variety of financial risks. These risks include market risk, credit risk and liquidity risk. The Company''s overall risk management program seeks to minimize potential adverse effects on the financial performance of the Company through established policies and processes which are laid down to ascertain the extent of risks, setting appropriate limits, controls, continuous monitoring and its compliance.

(a) Market risk :

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market prices. The Company is not an active investor in equity markets; it continues to hold certain investments in equity for long term value accretion. Market risk comprises of three type of risks namely interest rate risk, currency risk and other price risk such as equity price

risk. The Company is not exposed to currency risk and other price risk whereas the exposure to interest risk is given below :

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rate.

The Company invests in mutual fund schemes of leading fund houses and tax free bonds. Such investments are susceptible to market price risk that arise mainly from changes in interest rate which may impact the return and value of such investments. Investments in mutual funds and tax free bonds amounts to '' 303.35 million and '' 5,169.99 million as at March 31, 2023 and March 31, 2022 respectively.

(b) Credit Risk

The Company is exposed to credit risk, which is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the Company. Credit risk arises majorly from cash and cash equivalents, deposits with banks, Investments as well as credit exposures to customers including outstanding receivables.

Credit Risk Management

Credit risk is the risk of financial loss to the Company if a customer or counter-party fails to meet its contractual obligations, and arises principally from the companies receivables from customers.

Credit risk arises from the possibility that customers may not be able to settle their obligations as agreed. To manage this risk, the Company periodically assesses the financial reliability of customers, taking into account their financial position, past experience and other factors. The Company manages credit risk through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk is '' 4,358.63 million and '' 8,307.79 million as at March 31, 2023 and March 31, 2022 respectively, being the total of the carrying amount of balances with banks, bank deposits, trade receivables, other financial assets, loans and investments excluding equity investments in subsidiaries, and these financial assets are of good credit quality including those that are past due.

(c) Liquidity Risk

Liquidity Risk is the risk that the company will not be able to meet its financial obligation as they fall due. Liquidity risk arises because of the possibility that the company could be required to pay its liabilities earlier than expected or encounters difficulty in raising funds to meet commitments associated with financial liabilities as they fall due. The company approach to managing liquidity is to ensure, as far as possible, that it always have sufficient liquidity to meet its liabilities when due. The Company generates cash flows from operations to meet its financial obligations and manages liquidity risk by maintaining sufficient cash and bank balance and availability of funding through adequate amount of committed credit facilities.

(iv) Capital management

The capital structure of the Company consists of equity, debt, cash and cash equivalents. The Company''s objective for capital management is to maintain the capital structure which will support the Company''s strategy to maximize shareholder''s value, safeguarding the business continuity and help in supporting the growth of the Company.

The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using Debt-Equity ratio, which is net debt divided by total equity. Debt is defined as liabilities comprising interest-bearing loans and borrowings, lease liabilities less cash and bank balances. Adjusted equity comprises all components of equity.

(v) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. As at March 31, 2023 , the Company has floating rate borrowings. The Company constantly monitors the credit markets and rebalances its financing strategies to achieve an optimal maturity profile and financing cost.

For the year ended 31 March 2023, every 1% increase or decrease in the floating interest rate component (i.e., Treasury bill) applicable to its borrowings would affect the Company''s profit before tax by '' 29.53 million. For year ended March 31, 2022, the Company did not had any floating rate borrowings.

Note 33: Contingent Liability and Capital Commitment

('' in million)

As at

As at

Particulars

March 31,

March 31,

2023

2022

Claims against the Company not acknowledged as debts:

Notices relating to DPCO Matters (refer note below)

182.42

173.52

Notices regarding Income-tax matters

1.06

1.06

Others (Includes '' 50 million {Previous year '' Nil} {refer note 6})

70.38

68.83

Note: The Company has received notices from NPPA (National Pharmaceutical Pricing Authority), under DPCO (Drug Price Control Order), 2013 during earlier years. Management does not expect any cash outflow from this matter.

Estimated amount of contracts remaining unexecuted on capital account (net of advances) not provided for '' 8.40 million (Previous year ''28.92 million).

The Company has given corporate guarantee to bank for credit facilities upto '' 1,700 million availed by its subsidiary Eris Therapeutics Limited. As per the terms of deed of guarantee, the Company undertakes not to divest its ownership interest directly or indirectly in the subsidiary and provide such managerial, technical and financial assistance to ensure continued successful operations of the subsidiary.

The Company has given corporate guarantee to banks for credit facilities upto '' 4,350 million availed by its subsidiary Eris Oaknet Healthcare Private Limited (Formerly known as Oaknet Healthcare Private Limited) as per deed of guarantee, the Company undertakes not to divest its ownership interest directly or indirectly in the subsidiary and provide such managerial, technical and financial assistance to ensure continued successful operations of the subsidiary. The Company does not expect any outflow of resources in respect of the above.

Note 35: ESOP

A. Eris Lifesciences Employee Stock Option Plan 2017'' ("ESOP 2017"/ "Plan")

The Company has introduced ''Eris Lifesciences Employee Stock Option Plan 2017'' ("ESOP 2017"/ "Plan") through the resolution passed by the Board of Directors on February 02, 2017 and the same was approved by the shareholders at the extra ordinary general meeting held on February 03, 2017 and subsequently in the eleventh annual general meeting held on September 29, 2017 shareholders ratified the same. Under the scheme, 391,599 (Three lakhs ninety one thousand five hundred ninety nine only) equity shares have been granted to eligible employees of the company and each option (after it is vested) is exercisable for one equity share having face value of '' 1 each for an exercise price of '' 451.04. Vesting of the options shall take place over a maximum period of 5 years with a minimum vesting period of 1 year from the date of grant i.e. April 12, 2017. The exercise period would be a maximum of 5 years from the date of vesting of options.1,14,736 and 98,107 options have lapsed till March 31, 2023 and March 31, 2022 respectively.

As per the Scheme, the Nomination and Remuneration Committee grants the options to the employees deemed eligible.

Pricing Formula

Discount to fair market value of the Equity Shares as on the date of grant.

B. Eris Lifesciences Long Term Incentive Plan, 2021'' ("Employee Stock Option Plan"/ "Plan")

The Company has introduced ''Eris Lifesciences Long Term Incentive Plan, 2021'' ("Employee Stock Option Plan"/ "Plan") through the resolution passed by the Board of Directors on July 29, 2021 and the same was approved by the shareholders at the annual general meeting held on September 01, 2021. Under the scheme 13,58,630 equity shares have been approved in Annual General Meeting out of which, 2,14,102 (Two lakhs fourteen thousand one hundred two only) equity shares have been granted to eligible employees of the company and each option (after it is vested) is exercisable for one equity share having face value of '' 1 each for an exercise price of '' 557.24. Vesting of the options shall take place over a maximum period of 4 years with a minimum vesting period of 1 year from the date of grant i.e. February 10, 2022. The exercise period would be a maximum of 7 years from the date of vesting of options.

As per the Scheme, the Nomination and Remuneration Committee grants the options to the employees deemed eligible. Pricing Formula

Discount to fair market value of the Equity Shares as on the date of grant.

Method used for accounting of share-based payment plans

The employee compensation cost has been calculated using Black Scholes Option Pricing Model. The assumptions are as stated in the below table. The employee compensation cost as per fair value method for the financial year 2022-23 is '' 14.81 previous year NIL.

C. Eris Lifesciences Long Term Incentive Plan, 2021'' ("Employee Stock Option Plan"/ "Plan")

The Company has introduced ''Eris Lifesciences Long Term Incentive Plan, 2021'' ("Employee Stock Option Plan"/ "Plan") through the resolution passed by the Board of Directors on July 29, 2021 and the same was approved by the shareholders at the annual general meeting held on September 01, 2021. Under the scheme 13,58,630 equity shares have been approved in Annual General Meeting out of which, 2,79,568 (Two lakhs seventy nine thousand five hundred sixty eight only) equity shares have been granted to eligible employees of the company and each option (after it is vested) is exercisable for one equity share having face value of '' 1 each for an exercise price of '' 510.32. Vesting of the options shall take place over a maximum period of 4 years with a minimum vesting period of 1 year from the date of grant i.e. February 10, 2023. The exercise period would be a maximum of 7 years from the date of vesting of options.

As per the Scheme, the Nomination and Remuneration Committee grants the options to the employees deemed eligible. Pricing Formula

Discount to fair market value of the Equity Shares as on the date of grant.

Method used for accounting of share-based payment plans

The employee compensation cost has been calculated using Black Scholes Option Pricing Model. The assumptions are as stated in the below table. The employee compensation cost as per fair value method for the financial year 2022-23 is NIL previous year NIL.

Notes

(1) Debt represents borrowings and lease liabilities.

(2) "Net Profit after tax" means reported amount of "Profit / (loss) for the period" and it does not include items of other comprehensive income.

Earning for Debt Service = Net Profit after taxes Non-cash operating expenses like depreciation and other amortizations Interest other adjustments like loss on sale of Fixed assets etc.

(3) Lease payments, interest and principal repayment for the current year

(4) Tangible net worth deferred tax liabilities Lease Liabilities

Note 37 (B) : Other statutory information

i) . The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities

(Intermediaries) with the understanding that the Intermediary shall:

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

(b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

ii) . The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the

understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

iii) . Quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with

the books of accounts.

iv) . The title deeds of all the immovable properties, (other than immovable properties where the Company is the lessee and the lease

agreements are duly executed in favour of the Company) disclosed in the financial statements included in property, plant and equipment are held in the name of the Company as at the balance sheet date.

v) . The Company does not have any transactions or balances with a Companies struck off under section 248 of the Companies Act,

2013 or Section 560 of the Companies Act 1956.

vi) . The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or

disclosed as income during the year in the tax assessment under the Income Tax Act, 1961.

vii) . Details of Loan given, Investment made and Guarantee given covered u/s 186 (4) of the Companies Act, 2013:

(a) Loan given by the Company to body corporate as at March 31, 2023. (Refer Note 10)

(b) Investment made by the Company as at March 31, 2023. (Refer Note 3)

(c) Guarantee given by the Company as at March 31, 2023. (Refer note 33)

viii) The borrowings obtained by the Company from banks have been applied for the purposes for which such loans was taken.

ix) No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and Rules made thereunder.

x) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government

authority.

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

xii) The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

xiii) The company has not revalued its property,plant and equipment during the current or previous year.

xiv) There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

Note 39: Code of Social Security

The Parliament of India has approved the Code on Social Security, 2020 ("the Code") which, inter alia, deals with employee benefits during employment and post employment. The Code has been published in the Gazette of India. The effective date of the Code is yet to be notified and the rules for quantifying the financial impact are also yet to be issued. In view of this, the impact of the change, if any, will be assessed and recognised post notification of the relevant provisions.


Mar 31, 2022

1. The Company tests impairment of goodwill on an annual basis. Based on the annual impairment test no provision towards impairment was required necessary. The recoverable amounts determined based on value-in-use calculations which is calculated as the net present value of forecasted cash flows of the cash generating unit (CGU) to which the goodwill is related.

The key assumptions for CGUs with significant amount of goodwill as follows:

Projected cash flows for five years based on financial budgets/forecasts in line with the past experience. The perpetuity value is taken based on the long term growth rate depending on macro economic growth factors.

Acquired brands are considered as CGU for testing impairment of goodwill amounting to ''166.60 million generated on acquisition of brands.

The Management believes that any reasonable possible change in the key assumptions on which a recoverable amount is based would not cause the carrying amount to exceed its recoverable amount of the CGU.

3.1 Details of pledged securities:

Include ''350.00 million (31-03-2021 - ''350.00 million) marked under lien against overdraft facilities availed by the company.

3.2 Details of perpetual securities:

In the financial year 2018-19, the company has invested in unsecured subordinated perpetual securities issued by Aprica Healthcare Limited (Formerly known as UTH Healthcare Limited), its subsidiary company. These securities are redeemable at the issuer''s option and carry non-cumulative interest coupon at the rate of dividend paid on the issuer''s ordinary shares. No interest will be payable if the issuer does not pay any dividend on its ordinary shares for the Financial Year. The issuer has classified these instruments as equity under Ind AS 32 Financial Instruments presentation. Accordingly, the Company has classified this investment as Equity Instrument and has accounted at cost as per Ind AS 27 Separate Financial Statements.

3.3 Lock in period for Eris M. J. Biopharm Private Limited (Formerly Known as Kinedex Healthcare Private Limited)

As per share purchase & shareholders agreement, For a period of 10 (ten) years , Eris Lifesciences Limited and M.J. Biopharm Private Limited shall not, directly or indirectly, transfer or attempt to transfer all or any of the Equity Shares (or any interest therein) held by it to any Person.

11.4 Terms / Rights attached to the equity shares:

The Company has only one class of equity shares having a par value of ''1 per share. Each holder of equity share is eligible for one vote per share. The final dividend, if any, proposed by the Board of Directors of the Company is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

11.5 Share options granted under the Company’s employee share option plan:

The Company recognizes compensation expense relating to share-based payments in net profit using fair value in accordance with Ind AS 102, share based payment. The estimated fair value of awards is charged to income on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was in-substance multiple awards with a corresponding increase to share options outstanding account.

11.6 Buy back of shares:

During the financial year 2019-20, as on January 22, 2020, the Company concluded buy-back of 17,39,130 Equity Shares at a price of ''575 per equity share from eligible shareholders of the Company on a proportionate basis through Tender Offer route in accordance with the provisions of the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018 and the Companies Act, 2013 and rules made thereunder, as approved by the Board of Directors at their meeting held on July 03, 2019.

11.7 Dividend:

The Board of Directors of the Company has declared and paid an interim dividend of '' 6.01/- (at the rate of 601 Percent) per equity share of the face value of '' 1/- each for the financial year 2021-22 at its meeting held on July 29, 2021.

Nature and purpose of reserves:

Retained Earnings: Retained Earnings are the profits that the company has earned till date less any transfer to general reserve, dividends and other distributions to shareholder.

Share based payment reserve: The fair value of equity-settled share based payment transactions with employees is recognised in Statement of Profit and Loss with corresponding credit to Share based payment reserve.

Capital redemption reserve: The Company is required to create capital redemption reserve in accordance with provisions of the Companies Act 2013 for buy back of shares.

Security premium: The amount received in excess of the par value of equity shares has been classified as securities premium.

Interim Dividend: The Board of Directors of the Company has declared and paid an interim dividend of ''6.01/- (at the rate of 601 Percent) per equity share of the face value of '' 1/- each for the financial year 2021-22 at its meeting held on July 29, 2021.

Note 25 : Impact of COVID on Business and Financial statements

The Company continues to observe the Covid-19 impact on its business. This covers the monitoring of its impact on its supply-chain, and customers. Conclusions on significant accounting judgements and estimates have been drawn after exercising requisite due care. Such judgements and estimates include, inter-alia, recoverability of receivables, assessment of impairment of goodwill and intangibles, investments and inventory, based on the information available as of the date of preparing the Company''s financial statements for the year ended March 31,2022.

Note 26 : Arrangement with M. J. Biopharm Private Limited

During the year, Eris announced the execution of definitive agreements on December 03, 2021 with Mumbai-based M. J. Biopharm Private Limited marking Eris'' foray into the field of Biopharmaceuticals. Pursuant to this, the Company''s wholly owned subsidiary Eris M.J. Biopharm Private Limited (Formerly known as Kinedex Healthcare Private Limited) has issued fresh shares to M.J. Biopharm Private Limited, following which Eris is holding a 70% stake in Eris M.J. Biopharm Private Limited (Formerly known as Kinedex Healthcare Private Limited) and remaining 30% is held by M. J. Biopharm Private Limited. The initial contracted tenure of the arrangement is 10 years. On January 12, 2022, the said transaction has achieved Completion.

Note 27: EMPLOYEE BENEFIT PLANS

A) Defined contribution plans:

The Company makes contributions towards provident fund, a defined contribution retirement benefit plan for qualifying employees. The provident fund is operated by the Regional Provident Fund Commissioner. The Company recognized ''75.83 million (Previous Year ''75.10 million) for provident fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme. The Company made contributions towards Employees State Insurance Scheme operated by the ESIC Corporation. The Company recognized ''2.89 million (Previous year ''5.15 million) for ESIC contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

B) Defined benefit plans:

Actuarial Valuation for Compensated Absences is done as at the year end and the provision is made as per Company rules with corresponding charge to the Statement of Profit and Loss amounting to ''11.71 million (Previous Year ''23.83 million) and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation.

The company makes annual contributions to the Employee''s Group Gratuity cash accumulation scheme of the LIC, a funded defined benefit plan for qualifying employees. The Scheme provides for payment to vested employees at retirement/death while in employment or on termination of employment as per the provisions of the Gratuity Act, 1972. Vesting occurs on completion of 4.6 years of service. The present value of the defined benefit obligation and the related current service cost are measured using the Projected Unit Credit Method as per actuarial valuation carried out at the balance sheet date. The following table sets out the status of the gratuity plan as required under IND AS-19 and the amounts recognized in the Company''s financial statements as at March 31, 2022:

1. The plan assets which are managed by Insurance Company viz Life Insurance Corporation of India, details of those funds invested by the insurer are not available with company.

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

3. Expected rate of return on plan assets is determined based on the nature of assets and prevailing economic scenario.

4. The estimate of future salary increases considered, takes into account inflation, seniority, promotion, increments and other relevant factors.

5. The expected contribution to be made by company for gratuity during financial year ending March 31, 2023 is ''17.28 million (previous year ''13.49 million).

(ii) Fair value hierarchy :

Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three levels of a fair value hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data rely as little as possible on entity specific estimates.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

Determination of fair values: The following are the basis of assumptions used to estimate the fair value of financial assets and liabilities that are measured at fair value on recurring basis :

Investment in mutual funds : The fair values represent net asset value as stated by the issuers of these mutual fund units in the published statements. Net asset values represent the price at which the issuer will issue further units in the mutual fund and the price at which issuers will redeem such units from the investors.

Equity investments : Fair value of Equity investments traded in an active market are determined by reference to their quoted market prices. Other equity investments where quoted prices are not available, fair values are determined by reference to the current market value of net assets or relied upon on valuation report of an valuer.

(iii) Financial risk management :

The Company''s activities are exposed to variety of financial risks. These risks include market risk, credit risk and liquidity risk. The Company''s overall risk management program seeks to minimize potential adverse effects on the financial performance of the Company through established policies and processes which are laid down to ascertain the extent of risks, setting appropriate limits, controls, continuous monitoring and its compliance.

(a) Market risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market prices. The Company is not an active investor in equity markets; it continues to hold certain investments in equity for long term value accretion. Market risk comprises of three type of risks namely interest rate risk, currency risk and other price risk such as equity price risk. The Company is not exposed to currency risk and other price risk whereas the exposure to interest risk is given below:

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rate.

The Company invests in mutual fund schemes of leading fund houses and tax free bonds. Such investments are susceptible to market price risk that arise mainly from changes in interest rate which may impact the return and value of such investments. Investments in mutual funds and tax free bonds amounts to ''5,169.99 million and ''2,906.80 million as at March 31,2022 and March 31, 2021 respectively.

(b) Credit Risk

The Company is exposed to credit risk, which is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the Company. Credit risk arises majorly from cash and cash equivalents, deposits with banks, Investments as well as credit exposures to customers including outstanding receivables.

Credit Risk Management

Credit risk is the risk of financial loss to the Company if a customer or counter-party fails to meet its contractual obligations, and arises principally from the companies receivables from customers.

Credit risk arises from the possibility that customers may not be able to settle their obligations as agreed. To manage this risk, the Company periodically assesses the financial reliability ofcustomers,taking into account their financial position, past experience and other factors. The Companymanages credit risk through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk is ''8,307.79 million and ''5,720.61 million as at March 31,2022 and March 31,2021 respectively, being the total of the carrying amount of balances with banks, bank deposits, trade receivables, other financial assets, loans and investmentsexcluding equity investments in subsidiaries, and these financial assets are of good credit quality including those that are past due.

(c) Liquidity Risk

Liquidity Risk is the risk that the company will not be able to meet its financial obligation as they fall due. Liquidity risk arises because of the possibility that the company could be required to pay its liabilities earlier than expected or encounters difficulty in raising funds to meet commitments associated with financial liabilities as they fall due. The company approach to managing liquidity is to ensure, as far as possible, that it always have sufficient liquidity to meet its liabilitieswhen due. TheCompany generates cash flows from operations to meetitsfinancialobligationsandmanages liquidityrisk by maintaining sufficient cash and bank balance and availability of funding through adequate amount of committed credit facilities.

(iv) Capital management

The capital structure of the Company consists of equity, debt, cash and cash equivalents. The Company''s objective for capital management is to maintain the capital structure which will support the Company''s strategy to maximize shareholder''s value, safeguarding the business continuity and help in supporting the growth of the Company.

The Company manages its capital structure and makes adjustments to it in the light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using Debt-Equity ratio, which is net debt divided by total equity. Debt is defined as liabilities comprising interestbearing loans and borrowings, lease liabilities less cash and bank balances. Adjusted equity comprises all components of equity.

Note: The Company has received notices from NPPA (National Pharmaceutical Pricing Authority), under DPCO (Drug Price Control Order), 2013 during earlier years. Management does not expect any cash outflow from this matter.

Estimated amount of contracts remaining unexecuted on capital account (net of advances) not provided for Nil (Previous year ''28.92 million).

The Company has given letter of comfort to bank for credit facilities upto ''1500 million availed by its subsidiary Eris Therapeutics Limited. As per the terms of letter of comfort, the Company undertakes not to divest its ownership interest directly or indirectly in the subsidiary and provide such managerial, technical and financial assistance to ensure continued successful operations of the subsidiary.

The Company does not expect any outflow of resources in respect of the above.

Note 34: ESOP

A. Eris Lifesciences Employee Stock Option Plan 2017’ (“ESOP 2017”/ “Plan”)

The Company has introduced ‘Eris Lifesciences Employee Stock Option Plan 2017'' (“ESOP 2017”/ “Plan”) through the resolution passed by the Board of Directors on February 02, 2017 and the same was approved by the shareholders at the extra ordinary general meeting held on February 03, 2017 and subsequently in the eleventh annual general meeting held on September 29, 2017 shareholders ratified the same. Under the scheme, 391,599 (Three lakhs ninety one thousand five hundred ninety nine only) equity shares have been granted to eligible employees of the company and each option (after it is vested) is exercisable for one equity share having face value of '' 1 each for an exercise price of '' 451.04. Vesting of the options shall take place over a maximum period of 5 years with a minimum vesting period of 1 year from the date of grant i.e. April 12, 2017. The exercise period would be a maximum of 5 years from the date of vesting of options.1,14,736 and 98,107 options have lapsed till March 31, 2022 and March 31, 2021 respectively.

As per the Scheme, the Nomination and Remuneration Committee grants the options to the employees deemed eligible.

Pricing Formula

Discount to fair market value of the Equity Shares as on the date of grant.

Method used for accounting of share-based payment plans

The employee compensation cost has been calculated using Black Scholes Option Pricing Model. The assumptions are as stated in the below table. The employee compensation cost as per fair value method for the financial year 2021-22 is ''13.55 million and for financial year 2020-21 is ''11.20 million.

B. Eris Lifesciences Long Term Incentive Plan, 2021’ (“Employee Stock Option Plan”/ “Plan”)

The Company has introduced ‘Eris Lifesciences Long Term Incentive Plan, 2021'' (“Employee Stock Option Plan”/ “Plan”) through the resolution passed by the Board of Directors on July 29, 2021 and the same was approved by the shareholders at the annual general meeting held on September 01, 2021. Under the scheme 13,58,630 equity shares have been approved in Annual General Meeting out of which, 2,14,102 (Two lakhs fourteen thousand one hundred two only) equity shares have been granted to eligible employees of the company and each option (after it is vested) is exercisable for one equity share having face value of ''1 each for an exercise price of ''557.24. Vesting of the options shall take place over a maximum period of 4 years with a minimum vesting period of 1 year from the date of grant i.e. February 10, 2022. The exercise period would be a maximum of 7 years from the date of vesting of options.

As per the Scheme, the Nomination and Remuneration Committee grants the options to the employees deemed eligible.

Pricing Formula

Discount to fair market value of the Equity Shares as on the date of grant.

Method used for accounting of share-based payment plans

The employee compensation cost has been calculated using Black Scholes Option Pricing Model. The assumptions are as stated in the below table. The employee compensation cost as per fair value method for the financial year 2021-22 is NIL.

(1) Debt represents only lease liabilities.

(2) Net Profit after tax means reported amount of “Profit / (loss) for the period” and it does not include items of other comprehensive income.

Earning for Debt Service = Net Profit after taxes Non-cash operating expenses like depreciation and other amortizations Interest other adjustments like loss on sale of Fixed assets etc.

(3) Lease payments for the current year

(4) Tangible net worth deferred tax liabilities Lease Liabilities

Note 36 (B): Other statutory information

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

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

beneficiaries) or

(b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

ii) . The Company has not received any fund from any person(s) or entity(ies), including foreign entities (funding party) with the understanding (whether

recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate

beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

iii) . Quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts.

iv) . The title deeds of all the immovable properties, (other than immovable properties where the Company is the lessee and the lease agreements are duly

executed in favour of the Company) disclosed in the financial statements included in property, plant and equipment and capital work-in progress are held in the name of the Company as at the balance sheet date.

v) . The Company does not have any transactions or balances with a Companies struck off under section 248 of the Companies Act, 2013 or Section 560

of the Companies Act 1956.

vi) . The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income

during the year in the tax assessment under the Income Tax Act, 1961.

vii) . Details of Loan given, Investment made and Guarantee given covered u/s 186 (4) of the Companies Act, 2013:

(a) Loan given by the Company to body corporate as at March 31,2022. (Refer Note 10)

(b) Investment made by the Company as at March 31, 2022. (Refer Note 3)

(c) No Guarantee has been given by the Company as at March 31,2022. (Refer note 32)

Note 37: Segment reporting

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (CODM), in deciding how to allocate resources and assessing performance. The Company''s chief operating decision maker is the managing director and the company has only one reportable business segment i.e. ‘pharmaceuticals''.

Note 39: Change in method of Depreciation and Amortisation

During the year, the Management has reassessed the useful life of brands after taking into consideration prevalent industry practices. Based on the said reassessment, useful life of Brands in Intangible assets has been revised to 20 years from 50 years with effect from April 01, 2021.

During the year, the Management has also reassessed the method of providing depreciation on tangible assets after taking into consideration past experience and expected usage. Based on the said reassessment, method of depreciation has been changed to Straight Line Method from Written Down Value Method in case of Property, Plant and Equipment and Right of Use assets with effect from April 01,2021.

The Company has accounted for these changes in estimate of useful life and depreciation method prospectively and consequently, depreciation and amortisation expense for the year ended March 31, 2022 is higher by ''1.88 Million.

Note 40: Code of Social Security

The Parliament of India has approved the Code on Social Security, 2020 (“the Code”) which, inter alia, deals with employee benefits during employment and post employment. The Code has been published in the Gazette of India. The effective date of the Code is yet to be notified and the rules for quantifying the financial impact are also yet to be issued. In view of this, the impact of the change, if any, will be assessed and recognised post notification of the relevant provisions.


Mar 31, 2021

11.4: Terms / Rights attached to the equity shares:

The Company has only one class of equity shares having a par value of ''1 per share. Each holder of equity share is eligible for one vote per share. The final dividend, if any, proposed by the Board of Directors of the Company is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

11.5: Share options granted under the Company’s employee share option plan:

The Company recognizes compensation expense relating to share-based payments in net profit using fair value in accordance with Ind AS 102, share based payment. The estimated fair value of awards is charged to income on a straight-line basis over the requisite service period for each separately vesting portion of the award as if the award was in-substance multiple awards with a corresponding increase to share options outstanding account.

11.6: Buy back of shares:

During the previous year, as on January 22, 2020, the Company concluded buy-back of 17,39,130 Equity Shares at a price of '' 575 per equity share from eligible shareholders of the Company on a proportionate basis through Tender Offer route in accordance with the provisions of the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018 and the Companies Act, 2013 and rules made thereunder, as approved by the Board of Directors at their meeting held on July 03, 2019.

11.7:Dividend:

The Board of Directors of the Company has declared and paid an interim dividend of '' 5.50/- (at the rate of 550 Percent) per equity share of the face value of '' 1/- each for the financial year 2020-21 at its meeting held on August 4, 2020.

Nature and purpose of reserves:

Retained Earnings:

Retained Earnings are the profits that the company has earned till date less any transfer to general reserve, dividends and other distributions to shareholder.

Share based payment reserve:

The fair value of equity-settled share based payment transactions with employees is recognised in Statement of Profit and Loss with corresponding credit to Share based payment reserve.

Capital redemption reserve :

The Company is required to create capital redemption reserve in accordance with provisions of the Companies Act 2013 for buy back of shares.

Interim Dividend :

The Board of Directors of the Company has declared and paid an interim dividend of ''5.50/- (at the rate of 550 Percent) per equity share of the face value of '' 1/- each for the financial year 2020-21 at its meeting held on August 4, 2020.

Note 25: Impact of COVID on Business and Financial statements

The Company continues to observe the Covid-19 impact on its business. This covers the monitoring of its impact on its supply-chain and customers. Conclusions on significant accounting judgements and estimates have been drawn after exercising requisite due care. Such judgements and estimates include, inter-alia, recoverability of receivables, assessment of impairment of goodwill and intangibles, investments and inventory, based on the information available as of the date of preparing the Company''s financial statements for the year ended March 31, 2021.

Note 26.1: Amalgamation and Demerger of subsidiary companies

During the Financial Year 2020-21, pursuant to the composite scheme of arrangement under section 230 to 232 of the Companies Act, 2013, Pain division of Kinedex Healthcare Private Limited is demerged and subsequently merged into Aprica Healthcare Limited (Formerly known as UTH Healthcare Limited) with effect from Appointed date April 1, 2019 and Eris Therapeutics Private Limited and Aprica Healthcare Limited are merged into Aprica Healthcare Limited (Formerly known as UTH Healthcare Limited) with effect from Appointed date January 1, 2020.

Note 26.2: Acquisition of investment in subsidiary

During the Financial Year 2019-20, the Company has acquired remaining 17.81% shareholding on April 06, 2019 for a consideration of '' 213.73 million in Kinedex Healthcare Private Limited making it a wholly owned subsidiary.

Note 27: EMPLOYEE BENEFIT PLANS

A) Defined contribution plans:

The Company makes contributions towards provident fund, a defined contribution retirement benefit plan for qualifying employees. The provident fund is operated by the Regional Provident Fund Commissioner. The Company recognized ''75.10 million (Previous Year ''58.51 million) for provident fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

The Company made contributions towards Employees State Insurance Scheme operated by the ESIC Corporation. The Company recognized ''5.15 million (Previous year ''8.89 million) for ESIC contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

B) Defined benefit plans:

Actuarial Valuation for Compensated Absences is done as at the year end and the provision is made as per Company rules with corresponding charge to the Statement of Profit and Loss amounting to ''23.83 million (Previous Year ''22.09 million) and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation.

The company makes annual contributions to the Employee''s Group Gratuity cash accumulation scheme of the LIC, a funded defined benefit plan for qualifying employees. The Scheme provides for payment to vested employees at retirement/death while in employment or on termination of employment as per the provisions of the Gratuity Act, 1972. Vesting occurs on completion of 4.6 years of service. The present value of the defined benefit obligation and the related current service cost are measured using the Projected Unit Credit Method as per actuarial valuation carried out at the balance sheet date.

The following table sets out the status of the gratuity plan as required under IND AS-19 and the amounts recognized in the Company''s financial statements as at March 31, 2021:

1. The plan assets which are managed by Insurance Company viz Life Insurance Corporation of India, details of those funds invested by the insurer are not available with company.

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

3. Expected rate of return on plan assets is determined based on the nature of assets and prevailing economic scenario.

4. The estimate of future salary increases considered, takes into account inflation, seniority, promotion, increments and other relevant factors.

5. The expected contribution to be made by company for gratuity during financial year ending March 31, 2022 is ''13.49 million (previous year ''79.90 million).

(ii) Fair value hierarchy:

Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three levels of a fair value hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data rely as little as possible on entity specific estimates.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

Determination of fair values:

The following are the basis of assumptions used to estimate the fair value of financial assets and liabilities that are measured at fair value on recurring basis : Investment in mutual funds:

The fair values represent net asset value as stated by the issuers of these mutual fund units in the published statements. Net asset values represent the price at which the issuer will issue further units in the mutual fund and the price at which issuers will redeem such units from the investors.

Equity investments:

Fair value of Equity investments traded in an active market are determined by reference to their quoted market prices. Other equity investments where quoted prices are not available, fair values are determined by reference to the current market value of net assets or relied upon on valuation report of an valuer.

(iii) Financial risk management:

The Company''s activities are exposed to variety of financial risks. These risks include market risk, credit risk and liquidity risk. The Company''s overall risk management program seeks to minimize potential adverse effects on the financial performance of the Company through established policies and processes which are laid down to ascertain the extent of risks, setting appropriate limits, controls, continuous monitoring and its compliance.

(a) Market risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market prices. The Company is not an active investor in equity markets; it continues to hold certain investments in equity for long term value accretion. Market risk comprises of three type of risks namely interest rate risk, currency risk and other price risk such as equity price risk. The Company is not exposed to currency risk and other price risk whereas the exposure to interest risk is given below :

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of change in market interest rate.

The Company invests in mutual fund schemes of leading fund houses and tax free bonds. Such investments are susceptible to market price risk that arise mainly from changes in interest rate which may impact the return and value of such investments. Investments in mutual funds and tax free bonds amounts to '' 2,906.80 million and '' 746.16 million as at March 31, 2021 and March 31, 2020 respectively.

(b) Credit Risk

The Company is exposed to credit risk, which is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the Company. Credit risk arises majorly from cash and cash equivalents, deposits with banks, Investments as well as credit exposures to customers including outstanding receivables.

Credit Risk Management

Credit risk is the risk of financial loss to the Company if a customer or counter-party fails to meet its contractual obligations, and arises principally from the companies receivables from customers.

Credit risk arises from the possibility that customers may not be able to settle their obligations as agreed. To manage this risk, the Company periodically assesses the financial reliability of customers, taking into account their financial position, past experience and other factors. The Company manages credit risk through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk is '' 5,720.61 million and '' 3,033.07 million as at March 31, 2021 and March 31, 2020 respectively, being the total of the carrying amount of balances with banks, bank deposits, trade receivables, other financial assets and investments excluding equity investments in subsidiaries, and these financial assets are of good credit quality including those that are past due.

(c) Liquidity Risk

Liquidity Risk is the risk that the company will not be able to meet its financial obligation as they fall due. Liquidity risk arises because of the possibility that the company could be required to pay its liabilities earlier than expected or encounters difficulty in raising funds to meet commitments associated with financial liabilities as they fall due. The company approach to managing liquidity is to ensure, as far as possible, that it always have sufficient liquidity to meet its liabilities when due. The Company generates cash flows from operations to meet its financial obligations and manages liquidity risk by maintaining sufficient cash and bank balance and availability of funding through adequate amount of committed credit facilities.

Note 34: ESOP

The Company has introduced ''Eris Lifesciences Employee Stock Option Plan 2017'' ("ESOP 2017”/ "Plan”) through the resolution passed by the Board of Directors on February 02, 2017 and the same was approved by the shareholders at the extra ordinary general meeting held on February 03, 2017 and subsequently in the eleventh annual general meeting held on September 29, 2017 shareholders ratified the same. Under the scheme, 391,599 (Three lakhs ninety one thousand five hundred ninety nine only) equity shares have been granted to eligible employees of the company and each option (after it is vested) is exercisable for one equity share having face value of '' 1 each for an exercise price of '' 451.04. Vesting of the options shall take place over a maximum period of 5 years with a minimum vesting period of 1 year from the date of grant i.e. April 12, 2017. The exercise period would be a maximum of 5 years from the date of vesting of options. 98,107 and 49,886 options have lapsed till March 31, 2021 and March 31, 2020 respectively.

As per the Scheme, the Nomination and Remuneration Committee grants the options to the employees deemed eligible.

Pricing Formula

Discount to fair market value of the Equity Shares as on the date of grant.

Method used for accounting of share-based payment plans

The employee compensation cost has been calculated using Black Scholes Option Pricing Model. The assumptions are as stated in the below table. The employee compensation cost as per fair value method for the financial year 2020-21 is ''11.20 million and for financial year 2019-20 is '' 16.61 million.

Previous year figures have been regrouped wherever necessary, so as to make them comparable with those of the current year.


Mar 31, 2018

Corporate Information:

Eris Lifesciences Limited (“the Company”) is a public limited company, incorporated and domiciled in India having its registered office at 8th Floor, Commerce House- IV, Prahladnagar, Ahmedabad - 380015, Gujarat, India. The Company is engaged in the manufacture and marketing of pharmaceutical products.The company has a manufacturing plant located in Guwahati, Assam.The Company’s shares are listed on the National Stock Exchange of India Limited and BSE Limited.

1.1 Terms / Rights attached to the equity shares:

The Company has only one class of equity shares having a par value of Rs.1 per share. Each holder of equity share is eligible for one vote per share. The final dividend, if any, proposed by the Board of Directors of the Company is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Nature and purpose of reserves :

Retained Earnings : Retaned Earnings are the profits that the company has earned till date less any transfer to general reserve, dividends and other distributions to shareholder.

General reserve : General Reserve is created out of profits of the Company.The reserve arises on transfer portion of the net profit pursuant to the earlier provisions of Companies Act 1956. Mandatory transfer to general reserve is not required under the Companies Act 2013.

Term Loans from bank referred above to the extent of :

1. Term Loan of ‘3760.77 million (31-03-2017- Rs. Nil, 01-04-2016- ‘Nil) are secured by way of :

(i) Exclusive charge on the entire current assets of the company,both present and future.

(ii) Exclusive charge on entire immovable fixed assets of the company,both present and future.

(iii) Exclusive charge on movable fixed assets of Guwahati Plant of the company,

(iv) Exclusive charge on the Brand/Trademark/Assets acquired on acquisition of business from Strides Shasun Limited.

(v) Creation of DSRA by earmarking of existing OD Limit backed by mutual funds equivalent to one quarterly instalment and interest. Note- The company is in process of creating charge over assets.

2. Term Loan of ‘Nil (31-03-2017- ‘Nil, 01-04-2016- ‘5.00 million) are secured by way of pledge against Debt mutual funds.

Note 2: FIRST TIME IND AS ADOPTION RECONCILIATION

These financial statements are the first financial statements of the Company under Ind AS. The date of transition to Ind AS is April 1, 2016. The transition is carried out from Indian GAAP (previous GAAP) to Ind AS,notified under Section 133 of the Companies Act, 2013 [Companies (Indian Accounting Standards) Rules, 2015] and other relevant provisions of the Act.

Ind AS 101 -”First-time Adoption of Indian Accounting Standards”requires that all Ind AS and interpretations that are issued and effective for the first Ind AS financial statements which is for the year ended March 31, 2018 for the Company, be applied retrospectively and consistently for all financial years presented. The Company has recognised all assets and liabilities whose recognition is required by Ind AS and has not recognised items of assets or liabilities which are not permitted by Ind AS, reclassified items from previous GAAP to Ind AS as required under Ind AS and applied Ind AS in measurement of recognised assets and liabilities. However this principle is subject to certain exceptions and certain optional exemptions availed by the company.

Set out below are the Ind AS 101 optional exemptions availed and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

1. Classification and measurement of financial assets

The Company has assessed conditions for classification of the financial assets on the basis of the facts and circumstances that were exist on the date of transition to Ind AS.

2. Deemed cost of property, plant and equipment and intangible assets

On transition to Ind AS, the Company has elected to continue with the carrying value of all of its property, plant and equipment and intangible assets recognised as at April 01, 2016 measured as per the previous GAAP and use that carrying value as the deemed cost of the property, plant and equipment and intangible assets.

3. Business combinations :

Ind AS 101 provides option to apply Ind AS 103 prospectively from the transition date or from a specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combinations prior to the transition date. The Company elected to apply Ind AS 103 prospectively to business combinations occurring after its transition date. Business combinations occurring prior to the transition date have not been restated.

4. Investment in subsidiaries :

The Company has elected to measure its investments in subsidiaries at the Previous GAAP carrying amount as its deemed cost on the date of transition to Ind AS.

5. Estimates

Ind AS estimates on the date of transition are consistent with the estimates as at the same date made in conformity with previous GAAP.

Statement of reconciliation of Cash flow statement

The transition from previous GAAP to Ind AS has not had a material impact on the statement of cash flows.

Note 1 Under previous GAAP, Investment ( other than Investment in Subsidiaries) were carried at lower of cost or market value. Under Ind AS, the company has designated these investments at fair value through profit or loss (FVTPL). Accordingly, these investments are required to be measured at fair value. At the date of transition to Ind AS, difference between the fair value of the instruments and its Previous GAAP carrying amount has been recognised in retained earnings. Fair value changes are recognised in the Statement of Profit and Loss for the year ended 31st March, 2017.

Note 2 Under previous GAAP, prior period items were shown saperately where as under IND AS, prior period error is corrected by retrospective restatement except to the extent that it is impracticable to determine either the period-specific effects or the cumulative effect of the error.

Note 3 Under previous GAAP, useful life of Intangible Asset (Brand) was considered 10 years (restricted as per AS 26), where as under IND AS useful life of Intangible Asset(Brand) is considered 50 years as per management estimates and technical evaluation.

Note 4 Under previous GAAP, actuarial gains and losses were recognised in statement of profit and loss. Under Ind AS, the actuarial gains and losses form part of remeasurement of the net defined benefit liability / asset and are recognised in other comprehensive income.

Note 3 : BUSINESS COMBINATIONS AND ACQUISITIONS

(i) The Company on 30th November, 2017 acquired Indian domestic formulation business of Strides Shasun Limited for Rs.5000 million.

The India formulations business of Strides Shasun Limited was predominantly comprised of products in the Neurologoly, Central Nervous System (CNS), gynaecology, and gastrointestinal segments. The acquisition marks the foray of Eris in the CNS, Neurology segments and helps in scaling up its presence in the gynaecology and gastrointestinal segments.

The acquisition has been accounted for using the acquisition method of accounting. Acquisition has been divided into :

a) Business Transfer Arrangement with Strides Shasun Limited for Rs.4100 million.

b) Share Purchase Agreement with Eris Healthcare private Limited (Formerly known as Strides Healthcare private Limited) to acquired 100% shareholding for Rs.900 million.

* Difference between business transfer arrangement Rs.4100 million and purchase consideration Rs.4033.02 million is on account of Working capital adjustment.

Goodwill arose in the acquisition of the above said entity because the consideration paid for the combinations effectively included amounts in relation to the benefit of expected synergies, revenue growth, future market development and the assembled workforce. These benefits are not recognised separately from goodwill because they do not meet the recognition criteria for identifiable intangible assets.

Goodwill arising on the acquisition is deductible for tax purposes.

b) Share Purchase Agreement with Eris Healthcare private Limited ( Formerly known as Strides Healthcare private Limited) to acquire 100% shareholding.

Acquisition costs charged to Profit and Loss

Acquisition costs of Rs.35.89 were charged to statement of profit and loss under the head Other Expenses.

(ii) The Company on 1st October, 2017 has acquired 100% shareholding of UTH Healthcare Limited for a consideration of Rs.128.50 million.

UTH Healthcare Limited was deriving its revenue primarily from the product group covering vitamins, minerals, and nutrients. The acquisition has improved the offerings of Eris group in the nutraceuticals segment.

(iii) The Company on 23rd november, 2016 has acquired 75.48% shareholding of Kinedex Healthcare Private Limited for a consideration of Rs.773.69 million.

Kinedex healthcare private limited had been catering to ‘pain/ analgesics’ therapeutic area at the time of acquisition. The acquisition expands the product portfolio of Eris into mobility related disorders in the musculoskeletal therapy area.

(iv) Business acquisition has been done with an primary objective to diversify our existing product portfolio and expanding our business presence.

Note 4: EMPLOYEE BENEFIT PLANS

A) Defined contribution plans:

The Company makes contributions towards provident fund, a defined contribution retirement benefit plan for qualifying employees. The provident fund is operated by the Regional Provident Fund Commissioner. The Company recognized ‘40.49 million (Previous Year ‘39.47 million) for provident fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

The Company made contributions towards Employees State Insurance Scheme operated by the ESIC Corporation. The Company recognized ‘6.72 million (Previous year ‘4.04 million) for ESIC contributions in the Statement of Profit & Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

B) Defined benefit plans:

Actuarial Valuation for Compensated Absences is done as at the year end and the provision is made as per the Company rules with corresponding charge to the Statement of Profit and Loss amounting to ‘9.56 million (Previous Year Rs.(11.73) million) and it covers all regular employees. Major drivers in actuarial assumptions, typically, are years of service and employee compensation.

The company makes annual contributions to the Employee’s Group Gratuity cash accumulation scheme of the LIC, a funded defined benefit plan for qualifying employees.The Scheme provides for payment to vested employees at retirement/death while in employment or on termination of employment as per the provisions of the Gratuity Act, 1972. Vesting occurs on completion of 4.6 years of service. The present value of the defined benefit obligation and the related current service cost are measured using the Projected Unit Credit Method as per actuarial valuation carried out at the balance sheet date.

Notes:

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

2. Expected rate of return on plan assets is determined based on the nature of assets and prevailing economic scenario.

3. The estimate of future salary increases considered, takes into account inflation, seniority, promotion, increments and other relevant factors.

4. The expected contribution to be made by the company for gratuity during financial year ending March 31, 2019 is Rs.15.54 million (previous year Rs.12.08 million).

(ii) Fair value hierarchy :

Financial assets and financial liabilities measured at fair value in the statement of financial position are grouped into three levels of a fair value hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:

Level 1: Quoted prices (unadjusted) in active markets for financial instruments.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data rely as little as possible on entity specific estimates.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

Determination of fair values:

The following are the basis of assumptions used to estimate the fair value of financial assets and liabilities that are measured at fair value on recurring basis :

Investment in mutual funds : The fair values represent net asset value as stated by the issuers of these mutual fund units in the published statements. Net asset values represent the price at which the issuer will issue further units in the mutual fund and the price at which issuers will redeem such units from the investors.

Equity investments : Equity investments traded in an active market determined by reference to their quoted market prices. Other equity investments where quoted prices are not available, fair values are determined by reference to the current market value of net assets or relied upon on valuation report of an valuer.

(iii) Financial risk management :

The Company’s activities are exposed to variety of financial risks. These risks include market risk , credit risks and liquidity risk. The Company’s overall risk management program seeks to minimize potential adverse effects on the financial performance of the Company through established policies and processes which are laid down to ascertain the extent of risks, setting appropriate limits, controls, continuous monitoring and its compliance.

(a) Market risk:

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of change in market prices. The Company is not an active investor in equity markets; it continues to hold certain investments in equity for long term value accretion. Market risk comprises of three type of risks namely interest rate risk, currency risk and other price risk sruch as commodity risk. The Company is not exposed to currency risk and other price risk whereas the exposure to interest risk is given below :

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate becaue of change in market interst rate. The Company invests in mutual fund schemes of leading fund houses and tax free bonds. Such investments are susceptible to market price risk that arise mainly from changes in interest rate which may impact the return and value of such investments. Investments in mutual funds and tax free bonds amounts to Rs.3624.89 million and Rs.2992.97 million as at 31-March-2018 and 31-March-2017 respectively.

The Company’s borrowing is subject to variable rate interest rate risk. Exposure to secured loan from bank amounts to Rs.3736.88 million and Rs. Nil as at 31-March-2018 and 31-March-2017 respectively.

For the year ended March 31, 2018, every 50 basis increase in interest rates would decrease the company profit by approximate Rs.6.58 million (Previous year : Rs. Nil). Impact of 50 basis point decrease in interest rate would have led to an equal but opposite effect.

(b) Credit Risk

The Company is exposed to credit risk, which is the risk that counterparty will default on its contractual obligation resulting in a financial loss to the Company. Credit risk arises majorly from cash and cash equivalents, deposits with banks, Investments as well as credit exposures to customers including outstanding receivables.

Credit Risk Management

Credit risk is the risk of financial loss to the Company if a customer or counter-party fails to meet its contractual obligations, and arises principally from the Companies receivables from customers.

Credit risk arises from the possibility that customers may not be able to settle their obligations as agreed. To manage this risk, the Company periodically assesses the financial reliability of customers, taking into account their financial position, past experience and other factors. The Company manages credit risk through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macro economic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk is Rs.4927.02 million and Rs.3812.64 million as at 31-March-2018 and 31-March-2017 respectively, being the total of the carrying amount of balances with banks, bank deposits, trade receivables, other financial assets and investments excluding equity investments in subsidiaries, and these financial assets are of good credit quality including those that are past due.

(c) Liquidity Risk

Liquidity Risk is the risk that the company will not be able to meet its financial obligation as they fall due. Liquidity risk arises because of the possibility that the company could be required to pay its liabilities earlier than expected or encounters difficulty in raising funds to meet committments associated with financial liabilities as they fall due. The company approach to managing liquidity is to ensure, as far as possible, that it always have sufficient liquidity to meet its liabilities when due. The Company generates cash flows from operations to meet its financial obligations and manages liquidity risk by maintaining sufficient cash and bank balance and availability of funding through adequate amount of committed credit facilities.

Contractual maturities of significant financial liabilities are mentioned below. The amounts disclosed in the table are the contractual undiscounted cash flows :

(iv) Capital management

The capital structure of the Company consists of equity, debt, cash and cash equivalents. The Company’s objective for capital management is to maintain the capital structure which will support the Company’s strategy to maximize shareholder’s value, safeguarding the business continuity and help in supporting the growth of the Company.

Note 5: Loans to group Companies

Disclosures pursuant to Regulation 34(3) read with para A of Schedule V to the SEBI (Listing obligations and disclosure requirements) Regulations, 2015 and section 186(4) of the Companies Act, 2013.

Notes

a) The loanees did not hold any shares in the Share capital of the Company.

b) All loans given are for the purposes of the business.

Note 6

a) During the May 2017 , Pursuant to a tie-up agreement between the Company, Pharmanza, Aeran Lab (India) Private Limited and others, the company entered into deed of assignment to acquire rights and title to the Brands Union,Reunion and Bon-Union for an aggregate consideration of Rs.100 million, subject to certain additional payments contingent on sales of these brands.

b) During the July 2016 , the company acquired 40 Brands from Amay Pharmaceuticals Private Limited (Formerly known as Aprica Pharmaceuticals Private Limited) for a consideration of ‘328.7 million. The Company has also paid Rs.50 million to Amay as non compete fees in relation to above brand. Further, our Company acquired the entire equity shareholding of Aprica Healthcare private limited from Mr. Maharshi Sanjaykumar Vyas and Mr. Maulik Pandya, who incorporated Aprica Healthcare private limited.

Note: The Company has received notices from NPPA (National Pharmaceutical Pricing Authority), under DPCO (Drug Price Control Order), 2013 during the year. Management does not expect any cash outflow from this matter.

Note 7: Leases

The Company has entered into operating lease agreement for office premises and certain facilities. Lease payments recognised in the statement of profit and loss Rs.67.28 million (Previous year Rs.40.61 million). The Company has given refundable interest free security deposits in accordance with the agreed terms. The total future minimum lease payments under non-cancellable leases are as below:

Note 8: ESOP

The Company has granted 391,599 (Three lakhs ninety one thousand five hundred ninety nine only) equity shares under ‘Eris Lifesciences Employee Stock Option Plan 2017’ (“ESOP 2017”/ “Plan”) (date of grant i.e. 12th April, 2017) to eligible employees of the company.Each option after vesting date i.e. 12th April, 2018 is exercisable for one equity share having face value of Rs.1 each for an exercise price of Rs.451. Vesting of the options shall take place over a maximum period of 5 years with a minimum vesting period of 1 year. The exercise period would be a maximum of 5 years from the date of vesting of options. There is no accrual of option in the current year under consideration.

Note 9: Micro Small & Medium Enterprises

Based on the information available with the Company, there are no enterprises covered under the definition of Micro and Small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 (the Act). This has been relied upon by the Auditors.

Note 10: Implementation of Goods and Service Tax

Revenue from operations for periods up to June 30, 2017 includes excise duty, which is discontinued effective July 1, 2017 upon implementation of Goods and Services Tax (GST) in India. In accordance with Ind AS-18, “Revenue”, GST is not included in revenue from operations. In view of the aforesaid, revenue from operations for the year ended on March 31, 2018 are not comparable with the previous period.

Note 11: Segment reporting

Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker, in deciding how to allocate resources and assessing performance. The Company’s chief operating decision maker is the managing director and the company has only one reportable business segment i.e. ‘pharmaceuticals’.

Note 12: Regrouping

Previous year figures have been regrouped / reclassified wherever necessary to comply with Ind AS.


Mar 31, 2017

Note 1: Micro Small & Medium Enterprises

Based on the information available with the Company, there are no enterprises covered under the definition of Micro and Small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006 (the Act). This has been relied upon by the Auditors.

Note 2: Segment reporting

The primary and secondary reportable segments considered are business segments and geographical segments respectively. The company operates in a solitary business segment i.e. pharmaceuticals. Accordingly, no further disclosures for business segments has been given. Since the company has its operations in India only, disclosures relating to geographical segments have also not been presented separately.

Note 3: Excise duties

Excise duties shown as deduction from sales represents the amount of excise duty collected on sales. Excise duty expenses under the head “Other expenses”, represents

(i) the difference between excise duty element in closing stocks and opening stocks, and

(ii) excise duty paid on samples and on inventory write-off which is not recoverable from sales.

Details of pledged securities:

The following units / shares are marked under lien in favor of respective bank(s) against overdraft facilities availed by the company:

(32 2 2) Previous year 5,000,000 units are marked lien in favor of HDFC bank.

(32 2 3) Previous year 12,500,000 units are marked lien in favor of HDFC bank.

(32 2 4) Previous year 8,274,980 units are marked lien in favor of HDFC bank.

(3225) 1,289,414 (Previous year 1,289,414) units are marked lien in favor of HDFC bank.

(32 2 6) Previous year 2,284,222 units are marked lien in favor of HDFC bank.

(3227) 18,193,890 (Previous year 18,193,890) units are marked lien in favor of Axis bank.

<32 2 8- 8,451,486 (Previous year 8,451,486) units are marked lien in favor of HDFC bank and (Previous year 8,000,000) units are marked lien in favor of Axis bank.

(3229) 2,352,597 (Previous year 2,352,597) units are marked lien in favor of HDFC bank.

(32 2 10- 27,896,191 (Previous year 27,896,191 ) units are marked lien in favor of HDFC bank.

<32 2 11- 10,000,000 (Previous year 10,000,000) units are marked under lien in favor of Axis Bank against overdraft facility availed by the company.

Note 4: Retirement benefit plans: A) Defined contribution plans:

The Company makes contributions towards provident fund, a defined contribution retirement benefit plan for qualifying employees. The provident fund is operated by the Regional Provident Fund Commissioner. The Company recognized ''39.47 million (Previous Year ''41.65 million) for provident fund contributions in the Statement of Profit and Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme. The Company made contributions towards Employees State Insurance Scheme operated by the ESIC Corporation. The Company recognized ''4.04 million (Previous year ''1.98 million) for ESIC contributions in the Statement of Profit & Loss. The contributions payable to these plans by the company are at rates specified in the rules of the scheme.

B) Defined benefit plans:

The company makes annual contributions to the Employee’s Group Gratuity cash accumulation scheme of the LIC, a funded defined benefit plan for qualifying employees. The Scheme provides for payment to vested employees at retirement / death while in employment or on termination of employment as per the provisions of the Gratuity Act, 1972. Vesting occurs on completion of 4.5 years of service. The present value of the defined benefit obligation and the related current service cost are measured using the Projected Unit Credit Method as per actuarial valuation carried out at the balance sheet date. The following table sets out the status of the gratuity plan as required under AS-15 and the amounts recognized in the Company’s financial statements as at 31st March, 2017:

Note 5: ESOP

The Company has introduced ‘Eris Life sciences Employee Stock Option Plan 2017’ (“ESOP 2017” / “Plan”) through the resolution passed by the Board of Directors on 2nd February, 2017 and the same was approved by the shareholders at the extra ordinary general meeting held on 3rd February, 2017. Under the scheme, 391,599 (Three lakhs ninety one thousand five hundred ninety nine only) equity shares have been granted to eligible employees of the company and each option (after it is vested) is exercisable for one equity share having face value of '' 1 each for an exercise price of '' 451. Vesting of the options shall take place over a maximum period of 5 years with a minimum vesting period of 1 year from the date of grant i.e. 12th April, 2017. The exercise period would be a maximum of 5 years from the date of vesting of options.

Note 6: Initial Public Offer Expenses Recoverable

IPO expenses recoverable comprises share issue expenses incurred in connection with proposed Initial Public offer (IPO) only by way of offer for sale by existing shareholders of the Company. These receivables includes fees paid to bankers, stock exchanges, SEBI, lawyers, auditors, etc., in connection with the IPO of the Company. As per offer agreement between the Company and the selling shareholders, upon successful completion of the offer, all expenses with respect to the IPO will be borne by the selling shareholders in proportion to their respective Offered Shares sold pursuant to the Offer. Accordingly, the Company has classified the expenses incurred in connection with the IPO as receivable from selling shareholders under Other Current Assets as IPO expenses recoverable.

Note 7: Details of Subsequent events

Subsequent to the year ended March 31, 2017, the Company has acquired two trademarks for a consideration of ''100 Million.

Note 8: Regrouping

Previous year figures have been regrouped / reclassified wherever necessary, so as to make them comparable with those of the current year.

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