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Notes to Accounts of Fortis Healthcare Ltd.

Mar 31, 2023

At cash generating unit (CGUs) level, the goodwill is tested for impairment annually at the year-end or more frequently if there are indications that goodwill might be impaired. The entire goodwill balance is allocated to Fortis Hospitals Shalimar Bagh.

The Company made an assessment of recoverable amount of the CGUs based on value-in-use calculations which uses cash flow projections based on financial budgets approved by management. The fair value measurements were categorised as a Level 3 fair value based on the inputs in the valuation technique used. Cash flow projections were developed covering a seven-year period as at March 31, 2023 and March 31, 2022 which reflects a more appropriate indication/trend of future track of business of the Company. Cash flows beyond the seven-year period were extrapolated using estimate rates stated below.

The key assumptions for the value-in-use calculations are those regarding the discount rates, growth rates and expected changes to selling prices and direct costs during the year. Management estimates discount rates using post-tax rates that reflect current market assessments of the time value of money and the risks specific to the CGUs. The growth rates are based on industry growth forecasts. Changes in selling prices and direct costs are based on past practices and expectations of future changes in the market.

Management believes that any reasonable possible change in any of these assumptions would not cause the carrying amount to exceed its recoverable amount.

Discount rates - Management estimates discount rates using post-tax rates that reflect current market assessments of the risks specific to the CGU, taking into consideration the time value of money and individual risks of the underlying assets that have not been incorporated in the cash flow estimates. The discount rate calculation is based on the specific circumstances of the Company and its operating segments and is derived from its weighted average cost of capital (WACC).

Growth rates - The growth rates are based on industry growth forecasts. Management determines the budgeted growth rates based on past performance and its expectations of market development. The weighted average growth rates used were consistent with industry reports.

Trade Receivables are unsecured and are derived from revenue earned from providing healthcare and other ancillary services. No interest is charged on outstanding balance, regardless of the age of the balances. In accordance with Ind AS 109, the Company applies Expected Credit Loss (ECL) model for measurement and recognition of impairment loss towards expected risk of delays and defaults in collection. The Company has used a practical expedient by computing the expected credit loss allowance based on a provision matrix. Management makes specific provision in cases where there are known specific risks of consumer default in making the payments. The provision matrix takes into account historical credit loss experience and adjusted for forward looking information. The provision matrix at the end of the reporting period is as follows:

(b) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of '' 10 per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders. Each holder of equity share is entitled to one vote per share.

1) Amount shown is inclusive of perquisites, employer''s contribution to provident fund and excluding reimbursement of expenses.

2) As per the HMSA arrangement with the property holding companies, the Company pays service fee consideration to the property holding companies, as an when due. As per terms of the HMSA, in the event of any delay in payment of the Service Fee, an interest at a rate of State Bank of India base rate plus 2% per annum (on a compounded monthly basis) shall be payable to the property holding companies by the Company. The Company and property holding companies have agreed that no interest would be charged/demanded for the delay in the payments on amounts under HMSA for the financial year 2021-22 and 2022-23 on account of the continued business relation. Consequently, the Company has not recognised interest on the delayed payment of the service fees/technology renewal fund during the year ended March 31, 2022 and March 31,2023.

3) Also refer note 9(a), 9(b) and 23.

(b) As a lessor

Assets given on operating lease:

The Company has sub-leased some portion of hospital premises carrying value of which is included in buildings (refer note 7(a) and 5(i)(a)). In all the cases, either of the parties have option to terminate the agreements at any time during the lease term. The total lease income in respect of the above leases recognised in the Statement of Profit and Loss for the year are '' 28.90 Lakhs (March 31, 2022 '' 14.31 lakhs).

The Company has also leased out certain property, plant and equipment on operating lease to a trust managing hospital operations. The lease term is renewable at the option of the lessor. The total lease payment received in respect of such leases recognised in the statement of profit and loss for the year are '' 615.22 lakhs (March 31, 2022''640.46 Lakhs).

The Company had also availed overdraft facility from DBS Bank Limited with interest rate of overnight MCLR plus 125 bps margin payable on monthly basis which was secured by:

(i) First pari passu charge over current assets and moveable fixed assets of the borrower (except vehicles under specific charge with ICICI and Kotak bank),

(ii) Cross guarantees from Fortis Hospitals Limited, Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Fortis Hospotel Limited and Escorts Heart and Super Speciality Hospital Limited.

During the current financial year, the Corporate Guarantees from Fortis Hospitals Limited, Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Escorts Heart and Super Speciality Hospital Limited, Fortis Hospotel Limited and Hospitalia Eastern Private Limited were withdrawn.

As on March 31, 2023, the outstanding balance of overdraft is Nil. (Balance outstanding as at March 31, 2022 '' 1.90 Lakhs).

(b) During the previous year, the Company has availed working capital loan or overdraft facility from Axis Bank Limited for meeting day to day working capital requirements. The working capital loan was secured against first pari passu charge on entire current assets and movable fixed assets of the Company, excluding vehicles and medical equipment exclusively financed by other lenders. The rate of interest was 1-month

MCLR 35 bps or rate which is mutually agreeable with the bank. As on March 31, 2023, the outstanding balance of overdraft is Nil. (Balance outstanding as at March 31, 2022 '' 500 Lakhs).

(c) During the earlier year, the Company had taken term loan for '' 64,483.00 Lakhs secured by exclusive charge on the fixed assets (immovable) with minimum assets cover of 1.33X basis cumulative property value of Escorts Heart and Super Speciality Hospital Limited (immovable property situated in Mohali), International Hospital Limited (immovable property situated in Faridabad and Noida), Hospitalia Eastern Private Limited (immovable property situated in Ludhiana), Fortis Hospotel Limited (immovable property situated in Gurugram), corporate guarantee from Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Escorts Heart and Super Speciality Hospital Limited, Hospitalia Eastern Private Limited, Fortis Hospitals Limited and Fortis Hospotel Limited and first pari passu charge on the current assets and movable fixed assets of the borrower (Company) with rate of interest being 12 month MCLR or any other rate as may be mutually agreed from time to time (Previous year MCLR with quarterly reset linked to 3 month MCLR or any other rate as may be mutually agreed from time to time).

During the current financial year, the Corporate Guarantees from Fortis Hospitals Limited, Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Escorts Heart and Super Speciality Hospital Limited, Hospitalia Eastern Private Limited and Fortis Hospotel Limited were withdrawn.

During the earlier year, the Company had partly refinanced the HSBC term loan facility of '' 2,075.82 Lakhs from DBS Bank India Limited. Further, during the current year, the Company has availed an additional term loan facility of '' 400.00 Lakhs from HSBC.

Out of total term loan facilities, '' 7,490.67 Lakhs is repayable in June 2024, '' 4,788.10 Lakhs is repayable over 8 years (last instalment due in October 2030) with put/call option exercisable on or after September 05, 2026, '' 2,972.89 Lakhs is repayable over 4 years (last instalment due in August 2026), '' 400.00 Lakhs is repayable over 6 years (last instalment due in June 2029). As on March 31, 2023, the outstanding balance of term loans are '' 15,651.66 Lakhs (Balance outstanding as on March 31, 2022 was '' 29,162.46 Lakhs).

(d) During the earlier year, the Company had taken term loan of '' 2,283.62 Lakhs from DBS Bank India Limited with interest rate of Bank''s 3-month MCLR plus 100 bps margin with quarterly reset payable on monthly basis which is secured by:

(i) First pari passu charge over current assets and moveable fixed assets of the borrower (except vehicles under specific charge with ICICI and Kotak bank),

(ii) Exclusive charge over immovable fixed assets of Escorts Heart and Super Speciality Hospital Limited located at Jaipur, Rajasthan with a security cover of minimum 1.33x.

(iii) Cross guarantees from Fortis Hospitals Limited, Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Fortis Hospotel Limited and Escorts Heart and Super Speciality Hospital Limited.

Out of total term loan facility of '' 2,283.62 Lakhs aforesaid, term loan facility of '' 2,075.82 Lakhs was availed for refinancing of existing credit facility from HSBC Bank Limited. The loan

is repayable in 4 years 9 months and remaining term loans facility taken for Capex of '' 207.80 Lakhs is repayable in 16 quarterly instalments starting from December 01, 2021. During the year, the Company has further drawn 762.48 Lakhs capex loan. As on March 31, 2023, the outstanding balance of term loans including capex loans are '' 1,808.41 Lakhs. (Balance outstanding as at March 31,2022 was '' 2,213.07 Lakhs.).

(e) During the previous year, the Company has availed the term loan facility from Axis Bank Limited which was utilised for the part -refinance of existing term loan of HSBC Bank Limited to the extent of '' 20,000.00 Lakhs with interest rate of repo rate 2.80% (presently 6.80% p.a.) payable at monthly intervals. The loan is repayable in structured quarterly instalments w.e.f December 21, 2023 which is secured by:

(i) First pari passu charge on entire current assets (present and future) of the Company

(ii) First pari passu charge on entire movable fixed assets (present and future) of the Company, excluding vehicles and medical equipment exclusively financed by other lenders, and

(iii) Exclusive charge on immovable fixed assets of International Hospital Limited located at BG Road, Bangalore with minimum security cover of 1.33x.

(iv) Corporate guarantee of property owing company International Hospitals Limited. As on March 31, 2023, the outstanding balance of term loan is '' 7,829.49 Lakhs (Balance outstanding as at March 31, 2022 was '' 19,931.44 Lakhs) (net of financial guarantee liability).

(f) During Financial year 2019-20, the Company had taken vehicle loan for '' 68.26 Lakhs from Kotak Mahindra Prime Limited with current average rate of interest of 9.27% p.a. The loan is repayable in 48 structured monthly instalments and secured against hypothecation of the specific vehicle purchased. As on March 31, 2023, the outstanding balance of vehicle loan is '' 8.73 Lakhs (Balance outstanding as at March 31, 2022 was '' 22.62 Lakhs).

(g) During the previous year, the Company had taken vehicle loan for '' 28.74 Lakhs from ICICI Bank Limited with current average rate of interest of 8.53 % p.a. The loan is repayable in 48 structured monthly instalments and secured against hypothecation of the specific vehicle purchased. During the current year, Company has also availed additional vehicle loan of '' 120.64 Lakhs from ICICI Bank Limited. As on March 31, 2023, the outstanding balance of vehicle loan is '' 185.92 Lakhs. (Balance outstanding as at March 31, 2022 was '' 100.08 Lakhs).

During earlier years, the Company had availed unsecured loan from its subsidiary company, Stellant Capital Advisory Services Private Limited, of '' 4,265 Lacs with rate of interest of 8.85% p.a. which is repayable on or before March 31, 2025. The rate of interest has been reduced to 7.95% p.a. with effect from April 1, 2021.

During the year, the Company had repaid unsecured loan of '' 43.00 Lakhs. The outstanding balance of unsecured loan is '' 3,378.03 Lakhs. (Balance outstanding as at March 31,2022''3,421.03 Lakhs). During earlier years, the Company has availed unsecured loan from its subsidiary company, Fortis

Malar Hospitals Limited, of '' 2,800 Lakhs with rate of interest of 10.50% p.a. which is repayable on or before July 08, 2023, along with right to recall the loan any time after six months from the date of disbursement. As on March 31, 2023, the outstanding balance of unsecured loan is '' 2,800.00 Lakhs. (Balance outstanding as at March 31, 2022 '' 2,800.00 Lakhs)

Furthermore, during the earlier years, the Company has also availed unsecured loan from its subsidiary company, Fortis Malar Hospitals Limited, of '' 4,000 Lakhs with interest rate of 6.50 % p.a. The loan is repayable on or before two years from the date of drawdown (maturity date). As on March 31, 2023, the outstanding balance of unsecured loan is '' 4,000.00 Lakhs. (Balance outstanding as at March 31, 2022''4,000.00 Lakhs)

a. Going concern support in form of funding and operational support letters issued by the Company in favour of FLFL, FCCL, Fortis C-Doc Healthcare Limited, FHMEL, FESL, FGHML, FAHPL, Birdie & Birdie Realtors Private Limited, FHsL, EHSSHL, FHML, HEPL and EHIRCL.

Escorts Heart and Super Specialty Hospitals Limited and Fortis Health Management Limited) (collectively referred as ''Indemnified parties'') with the Company, the Company has undertaken to indemnify ("Tax Indemnity") each of the Hospital Services Companies and their respective directors, officers, employees and agents (the "Investing Parties") against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily

Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies. Accordingly, Company has accrued '' 205.03 Lakhs (as at March 31, 2022''205.03 Lakhs) as provision for contingency.

c. The Company does not have any long-term commitments or material non-cancellable contractual commitments/ contracts, including derivative contracts for which there were any material foreseeable losses.

d. These were no amount which were required to be transferred to be the investor education and protection fund by the Company.

110. The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the Company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published.

| 11. CONTINGENT LIABILITIES TO THE EXTENT NOT PROVIDED FOR:A. Guarantees:

Outstanding guarantees furnished to banks / subsidiaries on behalf of the subsidiary companies are '' 1,42,191.00 Lakhs (Previous year '' 1,43,294.00 Lakhs). The Company has recorded in books the fair value of guarantees given to subsidiary companies. (Refer note 5(iv)).

Claims against the Company, disputed by the Company, not acknowledged as debt (In addition, refer claims assessed as contingent liability described in Note 21, 22 and 23 below):

('' in lakhs)
Particulars	As at March 31, 2023	As at March 31, 2022
Income tax	6,618.89	6,618.89
Medical related	5,930.61	5,926.1 1
VAT	3,621.17	3,621.17
Service Tax and GST	344.00	537.00
Grand Total	16,514.67	16,703.17

On February 28, 2019, a judgment of the Supreme Court of India interpreting certain statutory defined contribution obligations of employees and employers (the "India Defined Contribution Obligation") altered historical understandings of such obligations, extending them to cover additional portions of the employee''s income to measure obligations under employees Provident Fund Act, 1952. There is significant uncertainty as to how the liability should be calculated as it is impacted by multiple variables, including the period of assessment, the application with respect to certain current and former employees and whether interest and penalties may be assessed. The Company has been legally advised not to consider that there is any probable obligations for periods prior to date of aforesaid judgment.

Additionally, the Company is involved in other disputes, lawsuits, claims, governmental and/or regulatory inspections, inquiries, assessments and proceedings, including commercial matters that arise from time to time in the ordinary course of business.

The Company believes that none of the above matters, either individually or in aggregate, are expected to have any material adverse effect on its financial statements. The cash flows in respect of above matters are determinable only on receipt of judgements/decisions pending at various stages/ forums.

B. Claims assessed as contingent liability and not provided for, unless otherwise stated:

A party ("Plaintiff") has filed a Civil Suit before the District Court, Delhi in February 2018 against various entities including the Company (together "the defendants") and has, inter alia, claimed implied ownership of brands "Fortis", "SRL*" and "La Femme" in addition to certain financial claims and for passing a decree alleging that consequent to a Term Sheet dated December 6, 2017 (''Term Sheet'') between the Company and a Third Party, the Company is liable for claims owed by the Plaintiff to the Third Party. In connection with this, the District Court passed an ex-parte order directing that any transaction undertaken by defendants, in favour of any other party, affecting the interest of the Plaintiff shall be subject to orders passed in the said suit. The above referred Third Party has sought to be substituted as a Plaintiff in the District Court proceedings.

The Company has filed written statement denying all allegations made against it and prayed for dismissal of the Civil Suit on various legal and factual grounds. The Company has in its written statement also stated that it has not signed the alleged Term Sheet with the Third Party. The matter is pending adjudication before District Court, Delhi. The Third Party has approached Delhi High Court for seeking certain interim reliefs against the Company under the provisions of The Arbitration and Conciliation Act, 1996. This Third party had also filed a claim for damages and injunctive reliefs against the Company before International Chamber of Commerce (ICC). The Company has invited the attention of ICC to the aforesaid pending litigations before various Courts and non-maintainability of claim raised by said Third party. Proceedings before Delhi High Court have been withdrawn by Third Party on February 24, 2020. Further, arbitration before ICC has also been withdrawn by Third Party on February 23, 2020 and the same has been closed by ICC on February 28, 2020. The Company has filed an application for perjury against the Third Party and other entities

which is pending before the Delhi High Court. During the year ended March 31, 2022, signatories of Third Party to the Term Sheet have also filed a duly affirmed affidavit before Delhi High Court stating that Term Sheet was neither signed on behalf of the Company before them nor did it ever come in force.

During the year ended March 31, 2022, another Party, claiming to be one of the assignee of Third Party has filed a case against 28 named defendants, including the Company and its ultimate parent Company IHH, and 21 non-party defendants, including the Company in the United States District Court, District of New Jersey, USA. Notice of the case has not yet been served on the Company under the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters. In December 2021, a notice of this case was served to IHH which was subsequently disclosed by it to Bursa Stock Exchange, Malaysia. Company is given to understand that the case has been filed for alleged violation of, inter-alia, the U.S. Racketeer, Influenced and Corrupt Organisations Act, copyright infringement, tortious interference with contracts, etc. and Party has claimed damages in excess of US$ 6.5 Billion against all the defendants. Company has made disclosure about this case to stock exchange. It has also sought legal advice and will pray for dismissal of this case, as and when served. Company is given to understand that vide order dated September 07, 2022, case has been dismissed by United States District Court, New Jersey on grounds of forum non conveniens. During the year ended March 31, 2023 another Party, claiming to be one of the assignee of the Third Party has initiated arbitration proceedings wherein an Interim Award was passed which was subsequently terminated by the Learned Arbitrator. Neither any notice nor any statement of claim has been received by the Company of the arbitration proceedings. Company will seek t legal advice and pray for dismissal of this case, as and when served. Company has filed a Civil Suit against the said third party which is sub-judice before the Hon''ble High Court of Delhi.

I n addition, in the year 2018, the Company had received four notices from the Plaintiff claiming (i) '' 1,800 Lakhs as per notices dated May 30, 2018 and June 01, 2018 (ii) '' 21,582 Lakhs as per notice dated June 04, 2018; and (iii) '' 1,962 Lakhs as per notice dated June 04, 2018. All these notices were responded to by the Company denying any liability whatsoever.

Separately, the Third Party has also alleged rights to invest in the Company. It has also alleged failure on part of the Company to abide by the aforementioned Term Sheet and has claimed ownership over the brands as well.

Allegations made by the Third party have been duly responded to by the Company denying (i) execution of any binding agreement with the Party and (ii) liability of any kind whatsoever.

Based on external legal advice, the Management believes that the claims are without legal basis and are not tenable and accordingly no adjustment is required in these audited Standalone Financial Statements with respect to these claims.

| 12. EMPLOYEE BENEFITS PLAN:Defined Contribution Plan

The Company''s contribution towards its Provident Fund Scheme and Employee State Insurance Scheme are defined contribution retirement plan for qualifying employees. The Company''s contribution to the Employees Provident Fund is deposited with Provident Fund Commissioner which is recognised by the Income Tax authorities.

The Company recognised '' 189.65 Lakhs (Previous year '' 205.36 Lakhs) for Provident Fund and Employee State Insurance Contribution in the Statement of Profit and Loss. The Contribution payable to the plan by the Company is at the rate specified in rules to the scheme.

Defined Benefit Plan(i) Gratuity

The Company has a defined benefit gratuity plan, where each employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn basic salary) for each completed year of service. Vesting occurs upon completion of 5 years of service. The Gratuity plan is unfunded.

The following table summarises the components of net benefit expenses recognised in the Statement of Profit and Loss and the amounts recognised in the Balance Sheet.

| 13. FINANCIAL INSTRUMENTS i) Capital Management

The Company manages its capital to ensure that the Company will be able to continue as going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance.

The capital structure of the Company consists of net debt (borrowings as detailed in notes 5(xv), and 7(a) offset by cash and bank balances) and total equity of the Company.

The Company is not subject to any externally imposed capital requirements other than for covenants under various loan arrangements of the Company.

The Company''s Board reviews the capital structure of the Company on need basis. As part of this review, the Board considers the cost of capital and the risks associated with each class of capital. Amongst other things, the Company''s objective for capital management is to ensure that it maintains stable capital management by monitoring the financial covenants attached to the interest bearing loans and borrowings.

The Company''s Corporate Treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks including market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Board of Directors manages the financial risk of the Company through internal risk reports which analyse exposure by magnitude of risk. The Company has limited exposure from the international market as the Company''s operations are in India. However, the Company has limited exposure towards foreign currency risk as it earns less than 10% of its revenue from foreign currency from international patients. Also, capital expenditure includes capital goods purchased in foreign currency through the overseas vendors. The Company has not taken any derivative contracts to hedge the exposure. However, the exposure towards foreign currency fluctuation is partly hedged naturally on account of receivable from customers and payable to vendors in foreign currency.

Market Risk

The Company''s activities expose it primarily to the financial risks of changes in interest rates and foreign currency exchange rates.

a) Foreign currency risk management

The Company undertakes transactions denominated in foreign currencies; consequently, exposures to exchange rate fluctuations arise. Exchange rate exposures are managed within approved policy parameters.

Foreign currency sensitivity analysis

The Company is mainly exposed to US$ currency.

The following table details the Company''s sensitivity to a 5% increase and decrease in the '' against US$. 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. This analysis assumes that all other variables in particular interest rates, remain constant. A positive number below indicates an increase in profit / decrease in loss or equity where the '' strengthens 5% against US$. For a 5% weakening of the '' against US$, there would be a comparable impact on the profit or equity, and the balances below would be negative.

Foreign exchange derivative and Non derivative financial instruments

The Company uses derivative for hedging financial risks that arise from its commercial business activities. The group''s Corporate Treasury team manages its foreign currency risk by hedging transactions that are expected to occur within 12 months for hedges of forecasted purchases and capital expenditures. When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting payable that is denominated in the foreign currency.

The Company is exposed to interest rate risk because Company borrows funds at both fixed and floating interest rates. The interest rate on the Company''s financial instruments is based on market rates. The Company monitors the movement in interest rates on an ongoing basis.

Interest rate sensitivity analysis

The sensitivity analyses below have been determined based on the exposure to interest rates at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50-basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management''s assessment of the reasonably possible change in interest rates.

c) Other price risks

The Company''s investment are in group companies and are held for strategic purposes rather than for trading purposes.

d) Credit risk management

Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the Company. The Company takes due care while extending any credit as per the approval matrix approved by Board of Directors.

The Company does not have any significant concentration of exposures to specific markets.

Refer note 5(v) of the standalone financial statements for carrying amount and maximum credit risk exposure for trade receivables.

Expected credit loss on financial assets other than trade receivables:

Company carries other financial assets such as balances with banks, advances, security deposits, loans to body corporates and interest accrued on such loans etc. Company monitors the credit exposure on these financial assets on a case-to-case basis. Loans to subsidiaries are assessed for credit risk based on the underlying valuation of the entity and their ability to repay within the contractual repayment terms. Company creates loss allowance wherever there is an indication that credit risk has increased significantly. Other the credit impaired financial assets as mentioned below, based on historical experience, the Company does not expect any significant risk of default.

Cash and cash equivalents and other bank balances

The Company held cash and cash equivalents and other bank balances of '' 97.68 Lakhs at 31 March 2023 (31 March 2022: '' 107.19 Lakhs). The cash and cash equivalents and other bank balances are held with banks, which have high credit ratings assigned by credit-rating agencies.

The Company considers that its cash and cash equivalents have low credit risk based on the external credit ratings of the counterparties.

The Group uses a similar approach for assessment of ECLs for cash and cash equivalents to those used for debt securities.

e) Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the Company''s short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

Note given below sets out details of additional undrawn facilities that the Company has at its disposal to further reduce liquidity risk.

Liquidity and interest risk tables

The following tables detail the Company''s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay.

The tables include both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the end of the reporting period.

The Company has a secured bank loan that contains a loan covenant. A future breach of covenant may require the Company to repay the loan earlier than indicated in the above table. Borrowings from HSBC, DBS and Axis Bank will become repayable on demand if the Company''s EBIDTA to loan ratio exceeds 4. Under the agreement, the covenant is monitored on a regular basis by the treasury department and regularly reported to management to ensure compliance with the agreement.

The following methods / assumptions were used to estimate the fair values:

(a) Fair valuation of financial assets and liabilities with short term maturities is considered as approximate to respective carrying amount due to the short-term maturities of these instruments.

(b) Fair valuation of non-current financial assets and liabilities has been disclosed to be same as carrying value as there is no significant difference between carrying value and fair value.

(c) The Company''s borrowings have been contracted at floating rates of interest, which resets at short intervals. Accordingly, the carrying value of such borrowings (including interest accrued but not due) approximates fair value.

(d) Fair value measurement of lease liabilities is not required.

(e) The fair value is determined basis valuation as provided by the issuing bank at the reporting date.

The fair value is determined by using the valuation model/technique with observable/ non-observable inputs and assumptions.

There are no transfers between Level 1, Level 2 and Level 3 during the year ended March 31, 2023 and March 31, 2022.

*excludes investment in subsidiaries of '' 7,88,759.75 Lakhs (Previous year '' 7,83,931.20 Lakhs) which are shown at carrying value (net of impairment) in balance sheet as per Ind AS 27 "Separate Financial Statements".

Financial instruments measured at amortised cost

The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.

157 EXCEPTIONAL ITEMS

(a) The Company had an investment aggregating to '' 15,105.47 Lakhs in Fortis Healthcare International Limited. The enterprise value of Fortis Healthcare International Limited has been determined based on the quoted market value (Level 1 fair value) of its underlying asset (Lanka Hospitals Corporation PLC). Based on this value, during the year ended March 31, 2023, the management has recorded write back of impairment loss recognised in earlier years of '' 4,828.57 Lakhs for the year ended March 31, 2023 (Impairment loss of '' 1,626.05 Lakhs as at March 31, 2022) towards the amount invested in Fortis Healthcare International Limited.

(b) During the previous year, the Company has invested '' 2.00 Lakhs in redeemable preference shares of Fortis La femme Limited. An allowance had been created of '' 2.00 Lakhs due to inability to pay by the subsidiary.

167 SEGMENT INFORMATION

The Company is primarily engaged in the business of healthcare services which is the only reportable segment as per Ind AS 108 "Operating Segments".

20. RECOVERABILITY OF CERTAIN ADVANCES / CAPITAL WORK-IN-PROGRESS

(Also refer to Note 22 of the Standalone Financial Statements)

The Company had paid security deposits and advances aggregating to '' 2,173.57 Lakhs in the financial year 2013-14 to a private company ("Lessor") towards lease of office space. Due to delays in obtaining occupancy certificate (OC), the lease agreement / MOUs were either terminated by the Company or expired during the financial year 2017-18. The amounts outstanding from the Lessor as on March 31, 2018 aggregated to '' 2,173.57 Lakhs. Additionally, expenditure aggregating to '' 2,569.90 Lakhs was incurred towards capital work-in-progress on the premises proposed to be taken on lease from the Lessor, which is also being claimed from the Lessor pursuant to the aforesaid termination. The Company has issued legal notice demanding the outstanding. Lessor responded to the notice of the Company for amicable resolution, which have not yet yielded any results. Further, Company has filed claim before Interim Resolution Professional (IRP) appointed by NCLT in a matter filed by one of creditors of Lessor. IRP is currently adjudicating the claims of various creditors of the Lessor including that of the Company.

In view of the facts stated above and the uncertainty in the ultimate recovery of the aforesaid balances, the Company had recorded provisions aggregating to '' 4,743.47 Lakhs in the Standalone Financial Statements for the year ended March 31, 2018.

| 21. The Board of Directors, after seeking inputs from reputed investment bankers, had approved an equity infusion of '' 400,000 Lakhs at a price of '' 170 per equity share into the Company by Northern TK Venture Pte Limited Singapore (NTK) ("Acquirer"), a wholly owned subsidiary of IHH Healthcare Berhad, Malaysia through a preferential allotment ("Preferential Issue"), subject to approval of the shareholders and other regulatory approvals which constituted 31.1% share capital of the Company. The shareholders of the Company approved the Preferential Issue by requisite majority at their Extra Ordinary General Meeting dated August 13, 2018. The Acquirer had received the approval from Competition Commission of India (CCI) on October 30, 2018 and the preferential allotment was made on November 13, 2018. Pursuant to the consummation of the same, Northern TK

Venture Pte Limited, had appointed 2/3 of the directors on the Board of Directors of the Company, thereby acquiring control over the Company. Consequently, the Company has become a subsidiary of Northern TK Venture Pte Limited. Further, pursuant to the Preferential Issue, Northern TK Venture Pte. Limited is under an obligation to make a mandatory open offer to the public shareholders of the Company and Fortis Malar Hospitals Limited in accordance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. However, in view of order dated December 14, 2018 passed by Hon''ble Supreme Court wherein it was specified that status quo with regard to sale of the controlling stake in Fortis Healthcare Limited to Malaysian IHH Healthcare Berhad be maintained, the Mandatory Open offer was kept in abeyance and continues to be in abeyance as on date, and remains subject to further orders by the Hon''ble Court. The Company had accordingly filed an application seeking for modification of the said order.

Vide its judgement dated November 15, 2019, the Hon''ble Supreme Court has issued suo- moto contempt notice to, among others, the Company and directed its Registry to register a fresh contempt petition in regard to alleged violation of its order dated December 14, 2018. In this respect, the Hon''ble Supreme Court has sought an enquiry, into (i) whether the subscription by the Acquirer to the shares of the Company was undertaken after the status quo order was issued by the Hon''ble Court on December 14, 2018 and accordingly, if such subscription was in violation of this status quo order; and (ii) the consummation of the acquisition of healthcare assets from RHT Health Trust by the Company.

The Company has filed a detailed reply to the show cause notice issued in the suo- moto contempt, praying inter alia, that the suo- moto contempt proceedings be dropped and ex- parte status quo order dated December 14, 2018 be modified/ vacated such that Open Offer may proceed.

an application for impleadment, modification of the status quo order and for proceeding with Mandatory Open Offer.

Vide judgment dated September 22, 2022 ("Judgement"), the Hon''ble Supreme Court of India disposed of Special Leave Petition (Civil) No. 20417 of 2017, Contempt Petition No. 2120 of 2018 in SLP (C) No. 20417 of 2019 and Suo Motu Contempt Petition (C) No. 4 of 2019, which includes the Petition in which the Status Quo Order dated December 14, 2018 had been issued. It has directed the Hon''ble High Court of Delhi inter alia that it may also consider issuing appropriate process and appointing forensic auditor(s) to analyse the transactions entered into between FHL and RHT and other related transactions. In so far as the acquisition of proprietary interests of RHT Health Trust by the Company is concerned, the Hon''ble Supreme Court has observed that prima facie, it appears to be acquisition of proprietary interest to subserve the business structure of the Company, as suggested by IHH/ NTK while observing that it is a matter to be enquired into and facts to be assessed in light of any forensic analysis, if the court so deems appropriate.

Pursuant to the Judgement, Hon''ble High Court of Delhi vide its order dated 18th October 2022 has directed Decree Holder to file an application defining contours of the forensic audit sought, which could thereafter be considered by the Delhi High Court. Decree Holder has filed application(s) before Delhi High Court seeking appropriate directions in connection with forensic audit. Matter is pending adjudication.

In view of the legal positions/claim(s) and defence(s) available to the Company and basis external legal advice, the management believes that it has a strong case on merits. It is of the view that these transactions were conducted in a fair and transparent manner, after obtaining all relevant regulatory and shareholders'' approval and only after making all due disclosures to public shareholders of the Company and to the regulatory authorities, in the requisite manner.

Further during the year ended March 31, 2021, in view of the aforesaid suo moto contempt notice, for abundant caution, an application was filed by the Company before the Hon''ble Supreme Court of India, praying for permission to it and its subsidiaries for changing their respective names, brands and logos; and for continued usage of the

same if the said application was not disposed of prior to expiry of the term of the Brand License Agreements to allow adequate time for smooth Brand transition without any disruption to business. During the year ended March 31, 2022, the brand license agreements have expired. As mentioned above, the Judgment has disposed of the Petitions and all applications thereunder, and the Company is evaluating the path ahead in consultation with its legal advisors with regard to the aforesaid brand transition.

[227 INVESTIGATION INITIATED BY THE ERSTWHILE AUDIT AND RISK MANAGEMENT COMMITTEE:

A. Background

(i) As disclosed in the financial statements for the years ended March 31, 2018, March 31, 2019 and March 31, 2020, during the year ended March 31 2018, there were reports in the media and enquiries from, inter alia, the stock exchanges received by the Company about certain inter- corporate loans given by a wholly owned subsidiary of the Company. The erstwhile Audit and Risk Management Committee of the Company decided to carry out an independent investigation through an external legal firm on this matter. The terms of reference of the investigation, inter alia, comprised: (i) ICDs amounting to a total of '' 49,414 Lakhs (principal), placed by the Company''s wholly-owned subsidiary, FHsL, with three borrowing companies as on July 01, 2017 ; (ii) the assignment of these ICDs to a third party and the subsequent cancellation thereof as well as evaluation of legal notice (now a civil suit) received from such third party ; (iii) review of intra-group transactions for the period commencing FY 2014-15 and ending on December 31, 2017; (iv) investments made in certain overseas funds by the overseas subsidiaries of the Company (i.e. Fortis Asia Healthcare Pte. Limited, Singapore and Fortis Global Healthcare (Mauritius) Limited) ; (v) certain other transactions involving acquisition of Fortis Healthstaff Limited ("Fortis Healthstaff") from an erstwhile promoter group company, and subsequent repayment of loan by said subsidiary to the erstwhile promoter group company. The

investigation report of which was submitted to the re-constituted Board in June 2018.

The investigation noted certain significant findings in relation to past transactions concerning FHL and its subsidiaries with companies whose current and/ or past promoters/ directors were known to/ connected with the erstwhile promoters of the Company. All such identified transactions were provided for by the Company in the financial statements for the year ended March 31, 2018.

The investigation was subject to the limitations on the information available to the external legal firm and their qualifications and disclaimers as described in their investigation report. It did not cover all related party transactions during the period under investigation. It was observed in internal correspondence within the Company that transactions with certain other entities have been referred to as related party transactions. However, no further conclusions could be drawn in this regard.

(ii) Related party relationships as required under Ind AS 24 - Related Party Disclosures and the Companies Act, 2013 were as identified by the Management taking into account the findings and limitations in the Investigation Report and the information available with the Management. In this regard, in the absence of specific declarations from the erstwhile directors on their compliance with disclosures of related parties, especially considering the substance of the relationship rather than the legal form, the related parties were identified based on the declarations by the erstwhile directors and the information available through the known shareholding pattern in the entities up to March 31,2018. Therefore, the possibility could not have been ruled out that there may have been additional related parties whose relationship may not have been disclosed and, hence, not known to the Management. While such references could not be fully analysed during the initial investigation, the nature of these references raised certain concerns.

In order to overcome the above, additional procedures/ enquiries were initiated as below.

B. Additional procedures/enquiries by the

reconstituted Board

(i) The Company''s Board of Directors initiated additional procedures/ enquiries of certain entities in the Group that were impacted in respect of the matters investigated by the external legal firm. Pending the additional procedures/ enquiries ("Additional Procedures/ Enquiries") and since the investigation was subject to the limitations on the information available to the external legal firm and their qualifications and disclaimers as described in their investigation report, as disclosed in the audited financial statements for the years ended March 31, 2018, March 31, 2019 and March 31, 2020, certain audit qualifications were made in respect of Company''s financial statements for those financial years, as the statutory auditors were unable to comment on the nature of those matters, the provisions established thereof, or any further potential impact on the financial statements. In order to resolve the same, the Board mandated the management to undertake review of certain areas in relation to historical transactions for the period April 01, 2014 to September 30, 2018 involving additional matters by engaging independent experts with specialised forensic skills to assist with the Additional Procedures/ Enquiries and provide inputs and expert advice in connection therewith. The independent experts submitted their report which was discussed and considered by the Board in its meeting held on September 16, 2020.

statements of Company or its subsidiaries. There are no other improper transactions identified by the Additional Procedures/Enquiries or the management, which had not been expensed or provided.

(iii) In connection with the potentially improper transactions, the Company has undertaken a detailed review of each case to assess the Company''s legal rights and has initiated necessary action.

C. Key findings during the investigation by the

external legal firm and during the Additional

Procedures/Enquiries by independent experts

(i) Fortis Hospitals Limited (FHsL), a wholly owned subsidiary of the Company, had placed secured Short-Term Investments in the nature of Inter Corporate Deposits (ICDs) with three companies (''borrowers'') aggregating to '' 49,414 Lakhs on July 1, 2017 for a term of 90 days. Further, FHsL received intimation that the borrowers became a part of the erstwhile Promoter Group with effect from December 15, 2017. These borrowers continued to be related parties until February 16, 2018. subsequent to which the shareholding of the erstwhile Promoter Group in the Company was reduced to 0.77%. In terms of agreements dated September 30, 2017, FHsL assigned the outstanding ICDs to a third party. Such assignment was subsequently terminated on January 5, 2018. On February 28, 2018, these ICDs were secured by way of a duly registered charge on the present and future assets of the Borrowers. ICDs aggregating to '' 44,503 Lakhs including interest accrued thereon of '' 4,260 Lakhs calculated up to March 31, 2018 remained outstanding. In view of the uncertainty in realisability of the security and/or collection of the amounts, the outstanding amount was fully provided during the year ended March 31,2018.

The Investigation Report indicated that the placement of the ICDs, including the method of such placement, their subsequent assignment and the cancellation of such assignment were

done without following the normal treasury operations and treasury mandate; and without specific authorisation by the Board of FHsL. (Also refer note 23 on SEBI Order).

As per the Additional Procedures/Enquiries by independent experts, the borrowers were potentially linked to the erstwhile promoters and also potentially linked to each other. FHsL has filed a civil suit on August 26, 2019 for recovery of '' 52,019 Lakhs before Hon''ble Delhi High Court against the Borrowers and few other entities. Further, in the complaint filed with the Economic Offence Wing, New Delhi (EOW) in November 2020 for certain other matters as mentioned subsequently, reference has been made of certain queries being put by SFIO in relation to this transaction, and the Company having responded thereto. A First Information Report (FIR) was registered by EOW in July 2021 w.r.t the above complaint.

(ii) The Company had paid security deposits and advances aggregating to '' 2,173 Lakhs in the financial year 2013-1

Mar 31, 2022

(a) Certain assets included under Property, plant and equipment are held as pledge against loans taken by the Company [refer note 8(i)[.

(b) The Company does not have any immovable property, whose title deeds are not held in the name of the company and no immovable property is jointly held with others.

(c) The Company has not revalued its Property, Plant and Equipment during the year ended March 31,2022 and previous year ended March 31, 2021.

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

(e) Certain assets have been given on lease [refer note 7(b)],

The Company made an assessment of recoverable amount of the CGUs based on value-in-use calculations which uses cash flow projections based on financial budgets approved by management. Cash flow projections were developed covering a seven-year period as at March 31,2022 and March 31,2021 which reflects a more appropriate indication/trend of future track of business of the Company. Cash flows beyond the seven-year period were extrapolated using estimate rates stated below.

Management believes that any reasonable possible change in any of these assumptions would not cause the carrying amount to exceed its recoverable amount.

(b) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of H 10 per share. Each holder of equity shares is entitled to one vote per share. Where dividend is proposed by the Board of Directors, it is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the current and previous year, there has been no dividend proposed by the Board of Directors. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the company after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

(b) As a lessor

Assets given on operating lease:

The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. The total lease income in respect of the above leases recognised in the Statement of Profit and Loss for the year are H 14.31 lacs (March 31, 2021 H 187.44 lacs).

8) Borrowings (Contd..)

(a) During the earlier years, the Company has availed overdraft facility from HSBC Bank Limited secured by first pari passu charge on the current assets and movable fixed assets of the borrower (Company) and corporate guarantee from Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Escorts Heart and Super Speciality Hospital Limited, Hospitalia Eastern Private Limited, Fortis Hospitals Limited and Fortis Hospotel Limited with rate of interest being HSBC overnight MCLR (Previous year HSBC overnight MCLR 70 bps) payable monthly or any other rate as may be agreed from time to time. These were previously also secured by exclusive charge on the fixed assets (immovable) with minimum assets cover of 1.33X basis cumulative property value of Escorts Heart and Super Speciality Hospital Limited (immovable property situated in Mohali), International Hospital Limited (immovable property situated in Faridabad and Noida), Hospitalia Eastern Private Limited (immovable property situated in Ludhiana), Fortis Hospotel Limited (immovable property situated in Gurugram). As on March 31, 2022, the outstanding balance of overdraft is H 2,080.59 lacs. (Balance outstanding as at March 31, 2021 was H 1,733.23 lacs).

The Company had also availed overdraft facility from DBS Bank Limited with interest rate of Bank''s 3-month MCLR plus 100 bps margin with quarterly reset payable on monthly basis which is secured by:

(i) First pari passu charge over current assets and moveable fixed assets of the borrower (except vehicles under specific charge with ICICI and Kotak bank),

This facility was previously also secured by exclusive charge over immovable fixed assets of International Hospital Limited located at Anandpur, Kolkata and BG Road, Bengaluru and Escorts Heart and Super Speciality Hospital

Limited located at Jaipur, Rajasthan with a security cover of minimum 1.33x,

As on March 31, 2022, the outstanding balance of overdraft is H 1.90 lacs. (Balance outstanding as at March 31,2021 H 2.22 lacs).

(b) During the previous year, the Company has availed working capital loan for meeting day to day working capital requirements. The loan is secured against pari-pasu charge on the current assets of the borrower. The rate of interest is HSBC 3-month MCLR plus 50 bps with quarterly reset or any other rate as may be mutually agreed from time to time. The same has been repaid during the year. (Balance outstanding as at March 31, 2021 H 4,000 lacs).

Additionally, during the year, the Company has availed working capital loan or overdraft facility from Axis Bank Limited for meeting day to day working capital requirements. The working capital loan is secured against first pari-pasu charge on entire current assets and movable fixed assets of the Company, excluding vehicles and medical equipment exclusively financed by other lenders. The rate of interest is 1 month MCLR 35 bps or rate which is mutually agreeable with the bank (presently 5.00 % per annum). As on March 31, 2022, the outstanding balance of overdraft is H 500.00 lacs.

(c) During the earlier year, the Company had taken term loan for H 64,483.00 lacs secured by exclusive charge on the fixed assets ( immovable ) with minimum assets cover of 1.33X basis cumulative property value of Escorts Heart and Super Speciality Hospital Limited (immovable property situated in Mohali), International Hospital Limited (immovable property situated in Faridabad and Noida), Hospitalia Eastern Private Limited (immovable property situated in Ludhiana), Fortis Hospotel Limited (immovable property situated in Gurugram), corporate guarantee from Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Escorts Heart and Super Speciality Hospital Limited, Hospitalia Eastern Private Limited, Fortis Hospitals Limited and Fortis Hospotel Limited and first pari passu

charge on the current assets and movable fixed assets of the borrower (Company) with rate of interest being MCLR (Previous year MCLR plus 50 bps) with quarterly reset linked to 3 month MCLR or any other rate as may be mutually agreed from time to time.

During the previous year, the Company had partly refinanced the HSBC term loan facility of H 2,075.82 lacs from DBS Bank Limited. Further, during the previous year, the Company had availed the term loan facility of H 4,096.49 lacs from HSBC Bank Limited.

Out of total term loan facilities, H 30,000.00 lacs is repayable in 5 years in 3 annual equal instalments starting financial year 2022-23, H 29,480.00 lacs is repayable in 11 years with put/ call option exercisable on or after September 05, 2023, H 6,596.49 lacs is repayable in 7 years in 24 equal quarterly instalments. As on March 31, 2022, the outstanding balance of term loans are H 29,162.46 lacs (Balance outstanding as at March 31, 2021 was H 63,822.86 lacs ).

(d) During the previous year, the Company had taken term loan of H 2,283.62 lacs from DBS Bank Limited with interest rate of Bank''s 3-month MCLR plus 100 bps margin with quarterly reset payable on monthly basis which is secured by:

(i) First pari passu charge over current assets and moveable fixed assets of the borrower (except vehicles under specific charge with ICICI and Kotak bank),

(ii) Exclusive charge over immovable fixed assets of Escorts Heart and Super Speciality Hospital Limited located at Jaipur, Rajasthan with a security cover of minimum 1.33x. Further, the charge was created over immovable fixed assets of International Hospital Limited located at BG Road, which was released in the current year. The Company is in the process of filing with the registrar for removal of such charge.

(iii) Cross guarantees from Fortis Hospitals Limited, Escorts Heart Institute and Research Centre Limited, International Hospital

Limited, Fortis Hospotel Limited and Escorts Heart and Super Speciality Hospital Limited.

Out of total term loan facility of H 2,283.62 lacs aforesaid, term loan facility of H 2,075.82 lacs was availed for refinancing of existing credit facility from HSBC Bank Limited. The loan is repayable in 4 years 9 months with demand option exercisable on or after September 01, 2023 and remaining term loans facility taken for Capex of H 207.80 lacs is repayable in 16 quarterly instalments starting from December 01, 2021 with demand option exercisable on or after September 01, 2023. During the year, the Company has further drawn 1,578.00 lacs capex loan. As on March 31, 2022, the outstanding balance of term loans including capex loans are H 2,213.07 lacs. (Balance outstanding as at March 31, 2021 was H 2,109.45 lacs.).

(e) During the current year, the Company has availed the term loan facility from Axis Bank Limited which shall be utilized for the part - refinance of existing term loan of HSBC Bank Limited to the extent of H 20,000.00 lacs with interest rate of repo rate 2.80% (presently 6.80% p.a.) payable at monthly intervals. The loan is repayable in structured quarterly instalments w.e.f December 21, 2023 which is secured by:

(i) First pari-pasu charge on entire current assets (present and future) of the Company

(ii) First pari-pasu charge on entire movable fixed assets (present and future) of the Company, excluding vehicles and medical equipment exclusively financed by other lenders, and

(iii) Exclusive charge on immovable fixed assets of International Hospital Limited located at BG Road, Bangalore with minimum security cover of 1.33x. Further, International Hospital Limited is in the process of creating charge over such immovable fixed assets.

(iv) Corporate guarantee of property owing company International Hospitals Limited. As on March 31, 2022, the outstanding balance of term loan is H 19,931.44 lacs

(f) During the previous year, the Company had taken vehicle loan for H 68.26 lacs from Kotak Mahindra Prime Limited with current average rate of interest of 9.27% p.a. The loan is repayable in 48 structured monthly instalments and secured against hypothecation of the specific vehicle purchased. As on March 31, 2022, the outstanding balance of vehicle loan is H 22.62 lacs (Balance outstanding as at March 31, 2021 was H 35.32 lacs).

(g) During the previous year, the Company had taken vehicle loan for H 93.46 lacs from ICICI Bank Limited with current average rate of interest of 7.60% p.a. The loan is repayable in 48 structured monthly instalments and secured against hypothecation of the specific vehicle purchased. During the current year, Company has also availed vehicle loan of H 28.74 lacs from ICICI Bank Limited. As on March 31, 2022, the outstanding balance of vehicle loan is H 100.08 lacs. (Balance outstanding as at March 31, 2021 was H 92.72 lacs).

During the previous year, the Company had availed unsecured loan from its subsidiary company, Stellant Capital Advisory Services Private Limited, of H 4,265.00 lacs with rate of interest of 8.85% p.a. which is repayable on or before March 31, 2023. The loan is expected to be further extended post this period. As on March 31, 2022, the outstanding balance of unsecured loan is H 3,421.03 lacs. (Balance outstanding as at March 31, 2021 H 3,452.03 lacs)

During the previous year, the Company has also availed unsecured loan from its subsidiary company, Fortis Malar Hospitals Limited, of H 2,800 lacs with rate of interest of 10.50% p.a. which is repayable on or before July 08, 2023, along with right to recall the loan any time after six months from the date of disbursement. As on March 31, 2022, the outstanding balance of unsecured loan is H 2,800.00 lacs. (Balance outstanding as at March 31, 2021 H 2,800.00 lacs)

Furthermore, during the current year, the Company has also availed unsecured loan from its subsidiary company, Fortis Malar Hospitals Limited, of H 4,000 lacs with interest rate of 6.50 % p.a. The loan is repayable on or before two years from the date of drawdown (maturity date). As on March 31, 2022, the outstanding balance of unsecured loan is H 4,000.00 lacs.

The Company has obtained borrowings from banks or financial institutions on the basis of security of current assets and has filed necessary statements with banks or financial institutions which are in agreement with the books of accounts.

The Company has used the borrowings from banks and financial institutions for the specific purpose for which it was taken.

a. Going concern support in form of funding and operational support letters issued by the Company in favour of FLFL, FCCL, Fortis C-Doc Healthcare Limited, FHMEL, FESL, FHIL, FGHML, FHIPL, FAHPL, Birdie & Birdie Realtors Private Limited, FHsL, EHSSHL, FHML, HEPL & EHIRCL.

b. As part of Sponsor Agreement entered between The Trustee-Manager of RHT Health Trust (formerly known as Religare Health Trust), Fortis Global Healthcare Infrastructure Pte. Limited and Hospital Service Companies (collectively for International Hospital Limited, Fortis Hospotel Limited, Escorts Heart and Super Specialty Hospitals Limited and Fortis Health Management Limited) (collectively referred as ''Indemnified parties'') with the Company, the Company has undertaken to indemnify ("Tax Indemnity") each of the Hospital Services Companies and their respective directors, officers, employees and agents (the "Investing Parties") against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies. Accordingly, Company has accrued H 205.03 lacs (as at March 31, 2021 H 205.03 lacs) as provision for contingency.

c. The Company does not have any long-term commitments or material non-cancellable contractual

commitments/ contracts, including derivative contracts for which there were any material foreseeable losses.

d. These were no amount which were required to be transferred to be the investor education and protection fund by the company.

10) The Indian Parliament has approved the Code on Social Security, 2020 which would impact the contributions by the Company towards Provident Fund and Gratuity. The Ministry of Labour and Employment has released draft rules for the Code on Social Security, 2020 on November 13, 2020, and has invited suggestions from stakeholders which are under active consideration by the Ministry. The Company will assess the impact and its evaluation once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective and the related rules to determine the financial impact are published.

11) Contingent liabilities to the extent not provided for:

A. Guarantees:

Outstanding guarantees furnished to banks / subsidiaies on behalf of the subsidiary companies are H 143,294.00 lacs (Previous year H 143,705.00 lacs). The Company has recorded in books the fair value of guarantees given to subsidiary companies. (Refer note 5(v)).

On 28 February 2019, a judgment of the Supreme Court of India interpreting certain statutory defined contribution obligations of employees and employers (the "India Defined Contribution Obligation") altered historical understandings of such obligations, extending them to cover additional portions of the employee''s income to measure obligations under employees Provident Fund Act, 1952. There is significant uncertainty as to how the liability should be calculated as it is impacted by multiple variables, including the period of assessment, the application with respect to certain current and former employees and whether interest and penalties may be assessed. The Company has been legally advised not to consider that there is any probable obligations for periods prior to date of aforesaid judgment.

12) Claims assessed as contingent liability and not provided for, unless otherwise stated:

A party ("Plaintiff") has filed a Civil Suit before the District Court, Delhi in February 2018 against various entities including the Company (together "the defendants") and has, inter alia, claimed implied ownership of brands "Fortis", "SRL" and "La Femme" in addition to certain financial claims and for passing a decree alleging that consequent to a Term Sheet dated December 6, 2017 (''Term Sheet'') between the Company and a Third Party, the Company is liable for claims owed by the Plaintiff to the Third Party. In connection with this, the District Court passed an ex-parte order directing that any transaction undertaken by defendants, in favour of any other party, affecting the interest of the Plaintiff shall be subject to orders passed in the said suit. The above referred Third Party has sought to be substituted as a Plaintiff in the District Court proceedings.

In addition, in the year 2018, the Company had received four notices from the Plaintiff claiming (i) H 1,800 lacs as per notices dated May 30, 2018 and June 1, 2018 (ii) H 21,582 lacs as per notice dated June 4, 2018; and (iii) H 1,962 lacs as per notice dated June 4, 2018. All these notices were responded to by the Company denying any liability whatsoever.

Allegations made by the Third party have been duly responded to by the Company denying (i) execution of any binding agreement with the Party and (ii) liability of any kind whatsoever.

13) Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and then directors of the Company/ its subsidiaries and erstwhile Holding company. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company.

During the year, no options are lapsed / exercised as no options were outstanding at the beginning of the year.

14) Employee Benefits Plan:

Defined Contribution Plan

The Company recognised H 205.36 lacs (Previous year H 163.17 lacs) for Provident Fund and Employee State Insurance Contribution in the Statement of Profit and Loss. The Contribution payable to the plan by the Company is at the rate specified in rules to the scheme.

Defined Benefit Plan

(i) Gratuity

i) Capital Management

The Company manages its capital to ensure that the Company will be able to continue as going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance.

The capital structure of the Company consists of net debt (borrowings as detailed in notes 5(xvi), 5(xvii), 5(xix) and 7(a) offset by cash and bank balances) and total equity of the company.

The Company is not subject to any externally imposed capital requirements other than for covenants under various loan arrangements of the Company.

The Company''s Board reviews the capital structure of the Company on need basis. As part of this review, the Board considers the cost of capital and the risks associated with each class of capital.

(ii) Financial risk management objectives

The Board of Directors manages the financial risk of the Company through internal risk reports which analyze exposure by magnitude of risk. The Company has limited exposure from the international market as the Company''s operations are in India. However, the Company has limited exposure towards foreign currency risk as it earns less than 10% of its revenue from foreign currency from international patients. Also, capital expenditure includes capital goods purchased in foreign currency through the overseas vendors. The Company has not taken any derivative contracts to hedge the exposure. However, the exposure towards foreign currency fluctuation is partly hedged naturally on account of receivable from customers and payable to vendors in foreign currency.

Market Risk

The Company''s activities expose it primarily to the financial risks of changes in interest rates and foreign currency exchange rates.

a) Foreign currency risk management

Foreign currency sensitivity analysis

The Company is mainly exposed to USD currency.

The following table details the company''s sensitivity to a 5% increase and decrease in the H against USD. 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an increase in profit / decrease in loss or equity where the H. strengthens 5% against USD. For a 5% weakening of the H against USD, there would be a comparable impact on the profit or equity, and the balances below would be negative.

b) Interest rate risk management

The Company is exposed to interest rate risk because Company borrow funds at both fixed and floating interest rates. The interest rate on the Company''s financial instruments is based on market rates. The Company monitors the movement in interest rates on an ongoing basis.

Interest rate sensitivity analysis

c) Other price risks

The Company''s investment are in group companies and are held for strategic purposes rather than for trading purposes.

d) Credit risk management

The Company does not have any significant concentration of exposures to specific markets.

Refer note 5(vi) of the standalone financial statements for carrying amount and maximum credit risk exposure for trade receivables.

Expected credit loss on financial assets other than trade receivables:

e) Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the company''s short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

Liquidity and interest risk tables

16) Fair value measurement (Contd..)

The following methods / assumptions were used to estimate the fair values:

(a) Fair valuation of financial assets and liabilities with short term maturities is considered as approximate to respective carrying amount due to the short-term maturities of these instruments.

(b) Fair valuation of non-current financial assets and liabilities has been disclosed to be same as carrying value as there is no significant difference between carrying value and fair value.

(d) Fair value measurement of lease liabilities is not required.

The fair value is determined by using the valuation model/technique with observable/ non-observable inputs and assumptions. There are no transfers between Level 1, Level 2 and Level 3 during the year ended March 31, 2022 and March 31, 2021.

*excludes investment in subsidiaries of H 783,931.20 lacs (Previous year H 785,557.25 lacs) which are shown at carrying value (net of impairment) in balance sheet as per Ind AS 27 "Separate Financial Statements".

Financial instruments measured at amortized cost

18) Exceptional items (Also refer note 20)

(a) The Company had an investment aggregating to H 15,105.47 lacs in Fortis Healthcare International Limited. During the year, the enterprise value of Fortis Healthcare International Limited has been determined based on the quoted market value (Level 1 fair value) of its underlying asset (Lanka Hospitals Corporation PLC). Based on this value, the management has recorded an impairment loss of H 1,626.05 for the year ended March 31, 2022 ( H 694.60 lacs as at March 31, 2021 ) towards the amount invested in Fortis Healthcare International Limited.

(b) During the year, the Company has invested H 2 lacs in redeemable preference shares of Fortis La femme. An allowance has been created of H 2 lacs due to inability to pay by the subsidiary.

19) Segment information

The Company is primarily engaged in the business of healthcare services which is the only reportable segment as per Ind AS 108 "Operating Segments".

20) During the early part of the previous year, the COVID - 19 pandemic impacted the revenues and profitability of the Company. The Company took various initiatives to support operations and optimize the cost. With a slew of these measures, the Company was able to significantly reduce the negative impact on its business and moved towards its normalization.

The Company has a well- capitalized Balance Sheet and has managed its liquidity position via cost efficiency initiatives, better working capital management and external funding.

As a part of its strategy to counter the impact of COVID-19 pandemic, with cost saving measures the Company got approval from its shareholders to seek waiver of fixed service fee payable to its certain subsidiaries under the Hospital & Medical Service Agreements (HMSA) entered with the said subsidiaries for at least two quarters (April-June 2020 and July-Sep 2020) assuming that the hospital operations, occupancy and footfall will return to normalcy by October 2020. However, if the business did not recover to normal levels by October 2020, then the waiver period could be extended until business became normal with the consent of both the Company and its subsidiaries. Accordingly, 50% waiver of fixed service fee for the third quarter (Oct-Dec 2020) was approved by the subsidiaries keeping in view the continued exceptional and unforeseen circumstances. In line with guidance on accounting for such concessions that are a direct consequence of the COVID-19 pandemic, the Company has recognised an exceptional gain of H 6,340 lacs for the year ended March 31, 2021.

Going forward, the actual impact of the Covid-19 pandemic may still be different from that what has been estimated. However, the Company is and will continue to closely monitor any material changes to future economic conditions.

25) Recoverability of certain advances / capital work-in-progress

(Also refer to Note 27 of the Standalone Financial Statements)

The Company had paid security deposits and advances aggregating to H 2,173.57 lacs in the financial year 2013-14 to a private company ("Lessor") towards lease of office space. Due to delays in obtaining occupancy certificate (OC), the lease agreement / MOUs were either terminated by the Company or expired during the financial year 2017-18. The amounts outstanding from the Lessor as on March 31, 2018 aggregated to H 2,173.57 lacs. Additionally, expenditure aggregating to H 2,569.90 lacs was incurred towards capital work-in-progress on the premises proposed to be taken on lease from the Lessor, which is also being claimed from the Lessor pursuant to the aforesaid termination. The Company has issued legal notice demanding the outstanding. Lessor responded to the notice of the Company for amicable resolution, which have not yet yielded any results. Further, Company has filed claim before Interim Resolution Professional (IRP) appointed by NCLT in a matter filed by one of creditors of Lessor. IRP is currently adjudicating the claims of various creditors of the Lessor including that of the Company.

In view of the facts stated above and the uncertainty in the ultimate recovery of the aforesaid balances, the Company had recorded provisions aggregating to H 4,743.47 lacs in the Standalone Financial Statements for the year ended March 31, 2018.

26) The The Board of Directors, after seeking inputs from reputed investment bankers, had approved an equity infusion of H 400,000 lacs at a price of H 170 per equity share into the Company by Northern TK Venture Pte Ltd Singapore (NTK) ("Acquirer"), a wholly owned subsidiary of IHH Healthcare Berhad, Malaysia through a preferential allotment ("Preferential Issue"), subject to approval of the shareholders and other regulatory approvals which constituted 31.1% share capital of the Company. The shareholders of the Company approved the Preferential Issue by requisite majority at their Extra Ordinary General Meeting dated August 13, 2018. The Acquirer had received the approval from Competition Commission of India (CCI) on October 30, 2018 and the preferential allotment was made on November 13, 2018. Pursuant to the consummation of the same, Northern TK Venture Pte Ltd, had appointed 2/3 of the directors on the Board of

Directors of the Company, thereby acquiring control over the Company. Consequently, the Company has become a subsidiary of Northern TK Venture Pte Ltd. Further, pursuant to the Preferential Issue, Northern TK Venture Pte. Ltd is under an obligation to make a mandatory open offer to the public shareholders of the Company and Fortis Malar Hospitals Limited in accordance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. However, in view of order dated December 14, 2018 passed by Hon''ble Supreme Court wherein it was specified that status quo with regard to sale of the controlling stake in Fortis Healthcare Limited to Malaysian IHH Healthcare Berhad be maintained, the Mandatory Open offer was kept in abeyance and continues to be in abeyance as on date, and remains subject to further orders by the Hon''ble Court. The Company had accordingly filed an application seeking for modification of the said order.

Further, at the request of SEBI by way of an application seeking impleadment, the Hon''ble Supreme Court of India has impleaded SEBI as a party in the petition pending before it. SEBI has prayed for allowing the Mandatory Open Offer. Further, the Hon''ble Supreme Court of India has issued notice on application filed by a public shareholder of the Company seeking impleadment. NTK has also filed an application for impleadment, modification of the status quo order and for proceeding with Mandatory Open Offer.

While the matter is currently sub-judice and we await the orders/ directions of the Hon''ble Supreme Court in this

regard, in view of the legal positions/claim(s) made and defence(s) raised by the Company, basis external legal advice, the management believes that it has a strong case on merits. It is the view of the Company these transactions were, at all times, conducted in a fair and transparent manner after obtaining all relevant regulatory and shareholder''s approval and only after making all due disclosures to public shareholders of the Company and to the regulatory authorities, in a timely manner. As per the current position of the case, liability, if any, arising out of this contingency cannot be determined at this stage. Accordingly, at present, no adjustment is required in the audited Standalone Financial Statements.

Further during the quarter ended September 30, 2020, in view of the aforesaid suo moto contempt notice, for abundant caution, an application was filed by the Company before the Hon''ble Supreme Court of India, praying for permission to it and its subsidiaries for changing their respective names, brands and logos; and for continued usage of the same if the said application was not disposed of prior to expiry of the term of the Brand License Agreements to allow adequate time for smooth Brand transition without any disruption to business. During the year ended March 31,2022, the Brand License Agreements have expired. The Company is awaiting order(s) of the Hon''ble Supreme court.

27) Investigation initiated by the erstwhile Audit and Risk Management Committee:

A. Background

(ii) the assignment of these ICDs to a third party and the subsequent cancellation thereof as well as evaluation of legal notice (now a civil suit) received from such third party ; (iii) review of intragroup transactions for the period commencing FY 2014-15 and ending on December 31, 2017; (iv) investments made in certain overseas funds by the overseas subsidiaries of the Company (i.e. Fortis Asia Healthcare Pte. Ltd, Singapore and Fortis Global Healthcare (Mauritius) Limited) ; (v) certain other transactions involving acquisition of Fortis Healthstaff Limited ("Fortis Healthstaff") from an erstwhile promoter group company, and subsequent repayment of loan by said subsidiary to the erstwhile promoter group company. The investigation report of which was submitted to the re-constituted Board in June 2018.

rather than the legal form, the related parties were identified based on the declarations by the erstwhile directors and the information available through the known shareholding pattern in the entities up to March 31, 2018. Therefore, the possibility could not have been ruled out that there may have been additional related parties whose relationship may not have been disclosed and, hence, not known to the Management. While such references could not be fully analyzed during the initial investigation, the nature of these references raised certain concerns.

In order to overcome the above, additional procedures/ enquiries were initiated as below.

B. Additional procedures/enquiries by the

reconstituted Board

(i) The Company''s Board of Directors initiated additional procedures/ enquiries of certain entities in the Group that were impacted in respect of the matters investigated by the external legal firm. Pending the additional procedures/ enquiries ("Additional Procedures/ Enquiries") and since the investigation was subject to the limitations on the information available to the external legal firm and their qualifications and disclaimers as described in their investigation report, as disclosed in the audited financial statements for the years ended March 31, 2018, March 31, 2019 and March 31, 2020, certain audit qualifications were made in respect of Company''s financial statements for those financial years, as the statutory auditors were unable to comment on the nature of those matters, the provisions established thereof, or any further potential impact on the financial statements. In order to resolve the same, the Board mandated the management to undertake review of certain areas in relation to historical transactions for the period April 1, 2014 to September 30, 2018 involving additional matters by engaging independent experts with specialized forensic skills to assist with the Additional Procedures/Enquiries and provide inputs and expert advice in connection therewith. The independent experts submitted their report which was discussed and considered by the Board in its meeting held on September 16, 2020.

(ii) The Board noted that the Additional Procedures/ Enquiries, prima facie, revealed further instances of payments made to the erstwhile promoter or to their directly or indirectly related parties including erstwhile promoter group entities which were potentially improper However, all of the amounts identified in the Additional Procedures/ Enquiries had been previously provided for or expensed in the financial statements of Company or its subsidiaries. There are no other improper transactions identified by the Additional Procedures/Enquiries or the management, which had not been expensed or provided.

(iii) In connection with the potentially improper transactions, the Company has undertaken a detailed review of each case to assess the Company''s legal rights and has initiated necessary action.

C. Key findings during the investigation by the

external legal firm and during the Additional

Procedures/Enquiries by independent experts

(i) Fortis Hospitals Limited (FHsL), a wholly owned subsidiary of the Company, had placed secured Short-Term Investments in the nature of Inter Corporate Deposits (ICDs) with three companies (''borrowers'') aggregating to H 49,414 lacs on July 1, 2017 for a term of 90 days. Further, FHsL received intimation that the borrowers became a part of the erstwhile Promoter Group with effect from December 15, 2017. These borrowers continued to be related parties until February 16, 2018. subsequent to which the shareholding of the erstwhile Promoter Group in the Company was reduced to 0.77%. In terms of agreements dated September 30, 2017, FHsL assigned the outstanding ICDs to a third party. Such assignment was subsequently terminated on January 5, 2018. On February 28, 2018, these ICDs were secured by way of a duly registered charge on the present and future assets of the Borrowers. ICDs aggregating to H 44,503 lacs including interest accrued thereon of H 4,260 lacs calculated up to March 31,2018 remained outstanding. In view of the uncertainty in realisability of the security and/ or collection of the amounts, the outstanding amount was fully provided during the year ended March 31, 2018.

The Investigation Report indicated that the placement of the ICDs, including the method of such placement, their subsequent assignment and the cancellation of such assignment were done without following the normal treasury operations and treasury mandate; and without specific authorization by the Board of FHsL. (Also refer note 28 on SEBI Order).

As per the Additional Procedures/Enquiries by independent experts, the borrowers were potentially linked to the erstwhile promoters and also potentially linked to each other. FHsL has filed a civil suit on August 26, 2019 for recovery of H 52,019 lacs before Hon''ble Delhi High Court against the Borrowers and few other entities. Further, in the complaint filed with the Economic Offence Wing, New Delhi (EOW) in November 2020 for certain other matters as mentioned subsequently, reference has been made of certain queries being put by SFIO in relation to this transaction, and the Company having responded thereto. A First Information Report (FIR) was registered by EOW in July 2021 against the above complaint.

(ii) The Company had paid security deposits and advances aggregating to H 2,173 lacs in the financial year 2013-14 to a private company ("Lessor") towards lease of office space. Due to delays in obtaining occupancy certificate (OC), the lease agreement / MOUs were either terminated by the Company or expired during the financial year 2017-18. The amounts outstanding from the Lessor as on March 31, 2018 aggregated to H 2,173 lacs. Additionally, expenditure aggregating to H 2,570 lacs was incurred towards capital work-in-progress on the premises proposed to be take on lease from the Lessor, which is also being claimed from the Lessor pursuant to the aforesaid termination. The Company has issued legal notice demanding the outstanding. Lessor responded to the notice of the Company for amicable resolution, which has not yet yielded any results. Further, Company has filed claim before Interim Resolution Professional (IRP) appointed by NCLT in a matter filed by one of creditors of Lessor. IRP is currently adjudicating the claims of various creditors of the Lessor including that of the Company.

In view of the facts stated above and the uncertainty in the ultimate recovery of the aforesaid balances, the Company had recorded provisions aggregating to H 4,743 lacs in the Standalone Financial Statements for the year ended March 31, 2018.

SFIO has sought information in respect of this transaction and the same has been duly provided by the Company. Further, as stated above, a complaint has been filed with the EOW in November 2020 by the Company for certain other matters in which a reference has been made to such SFIO enquiries as well as to the Company''s responses thereto and EOW is investigating the matter. A First Information Report (FIR) was registered by EOW in July 2021 against the above complaint.

(iii) FHsL, a wholly owned subsidiary of the Company, had advanced moneys to an entity towards acquisition of property in Mumbai in financial year 2013-14 which did not materialize. Of the total advance of H 10,000 lacs, balance of H 2,375 lacs was outstanding to be received back. Postdated cheques received from the entity were dishonoured, and FHsL initiated legal proceedings in this regard. FHsL had accrued for the interest amounting to H 174 lacs up to March 31, 2018 on the advance for the purpose of including the same in the legal claim on the entity. However, in line with applicable accounting norms, interest thereon for the period subsequent to March 31, 2018 was not accrued considering the uncertainties around ultimate realization of the amounts.

In view of the facts stated above and the uncertainty in the ultimate recovery of the aforesaid balances, the Group had recorded provisions aggregating to H 2,549 lacs towards the amounts due, including interest, in the year ended March 31, 2018

One of the directors of the entity, post summoning in the legal proceedings initiated by the Company has settled disputes for himself and the entity by paying H 2,300 lacs during the year ended March 31, 2020 towards full and final settlement.

Considering full and final settlement already done and the transaction having been legally concluded no further action is being taken.

(iv) During the year ended March 31, 2018, the Company through its subsidiary (i.e. Escorts Heart Institute and Research Centre Limited ("EHIRCL")), purchased further 71% equity interest in Fortis Healthstaff Limited("Healthstaff") at an aggregate consideration of H 3.46 lacs from erstwhile promoter group companies. Subsequently, EHIRCL advanced a loan to Healthstaff which was used to repay the outstanding unsecured loan amount of H 794.50 lacs to an erstwhile promoters group company. Certain documents suggest that the loan repayment by Healthstaff and some other payments to the erstwhile promoter group company may have been ultimately routed through various intermediary companies and used for repayment of the ICDs /vendor advance to FHsL / Company. Further, Healthstaff was not in a position to repay loan to the erstwhile promoter group company. EHIRCL also could not directly takeover the loan, as EHIRCL (holding 29%) could not have taken over the burden of the entire debt of Healthstaff. Therefore, this transaction was in a way to help the erstwhile promoter group companies ( 71% shareholders) to avoid making payment for its share, and place EHIRCL in a situation where it would find it hard to recover from its own now wholly owned subsidiary. Further, the said loan advanced by EHIRCL to Healthstaff was impaired in the books of account of EHIRCL due to anticipated chances of non-recovery during the year ended March 31, 2019.

Complaint has been filed in this regard, with the EOW in November 2020 against erstwhile promoters / erstwhile promoters Group Company and EOW is investigating the matter. A First Information Report (FIR) was registered by EOW in July 2021 against the above complaint.

(v) During the year ended March 31, 2018, the Company through its subsidiary (i.e. Fortis Hospitals Limited ("FHsL")), purchased further 51% equity interest in Fortis Emergency Services Limited (FESL) at an aggregate consideration

of H 0.255 lacs from erstwhile promoter group company. Subsequently, FHsL advanced a loan to FESL, which was used to repay the outstanding unsecured loan amount of H 215 lacs to an erstwhile promoter group company. Certain documents suggest that the loan repayment by FESL and some other payments to the erstwhile promoter group company may have been ultimately routed through various intermediary companies and used for repayment of the ICDs /vendor advance to FHsL / Company. Further, FESL was not in a position to repay loan to the erstwhile promoter group company. FHsL also could not directly takeover the loan, as FHsL (holding 49%) could not have taken over the burden of the entire debt of FESL. Therefore, this transaction was in a way to help the erstwhile promoter group company (51% shareholders) to avoid making payment for its share, and place FHsL in a situation where it would find it hard to recover from its own now wholly owned subsidiary Further, the said loan advanced by FHsL to FESL was impaired in the books of account of FHsL due to anticipated chances of non-recovery.

Complaint has been filed with the EOW in November 2020 against erstwhile promoters / erstwhile promoters group company and EOW is investigating the matter. A First Information Report (FIR) was registered by EOW in July 2021 against the above complaint.

(vi) Remuneration to ex-chairman

The Company having considered all necessary facts and taking into account external legal advice, had on June 27, 2018 decided to treat as nonest the Letter of Appointment dated September 27, 2016, as amended, ("LoA") issued to the erstwhile Executive Chairman of the Company in relation to his role as ''Lead: Strategic Initiatives'' in the Strategy Function. Since the LoA was treated as non-est, the Company received legal advice from its counsels that the amount paid under the aforesaid LoA (amounting to H 1,768 lacs) appears to be an arrangement designed to circumvent the managerial remuneration limits under Section 197 of the Companies Act, 2013 read with relevant Central Government approvals

and thus was wrongfully paid. Thus, as per the legal advice, the payments made to him under this LoA for the role of ''Lead: Strategic Initiatives'' ought to be considered and characterized as payments which are in the nature of managerial remuneration, as regulated and governed in section 197 of the Companies Act, 2013. An amount of H 234 lacs that was reimbursed in relation to expenses incurred was in excess of the amounts approved by the Central Government under Section 197 of the Companies Act, 2013. Accordingly, the Company sent a letter to the erstwhile Executive Chairman seeking refund of the excess amounts paid to him over and above the managerial remuneration limit, as specified under the Companies Act, 2013 read with the relevant government approvals in this regard. The erstwhile Executive Chairman sent a notice to the Company claiming H 4,610 lacs as allegedly due to him under the employment agreement. The Company replied to the same through its legal counsel denying any liability and stated that the demand was not payable being illegal. Subsequently, Company filed a complaint against the erstwh

Mar 31, 2021

The Company made an assessment of recoverable amount of the CGUs based on value-in-use calculations which uses cash flow projections based on financial budgets approved by management. Cash flow projections were developed covering a seven-year period as at March 31,2021 and March 31,2020 which reflects a more appropriate indication/trend of future track of business of the Company. Cash flows beyond the seven-year period were extrapolated using estimate rates stated below.

Management believes that any reasonable possible change in any of these assumptions would not cause the carrying amount to exceed its recoverable amount.

(b) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of '' 10 per share. Each holder of equity shares is entitled to one vote per share. Where dividend is proposed by the Board of Directors, it is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the current and previous year, there has been no dividend proposed by the Board of Directors. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company after distribution of all preferential amount. The distribution will be in proportion to the number of equity shares held by the shareholders.

(e) Shares reserved for issue under options

For details of shares reserved for issue under the employee stock option plan (ESOP) of the Company, refer note 13.

(f) For the period of five years immediately preceding the date of the balance sheet, there were no share allotment made for consideration other than cash and also no bonus shares were issued. Further, there has been no buyback of shares during the period of five years preceding the date of balance sheet.

(a) During the previous year, the Company has availed new overdraft facility from HSBC Bank Limited with overdraft limit of '' 10,000 Lakhs (two overdraft limits of '' 5,000 Lakhs each), secured by exclusive charge on the fixed assets (immovable) with minimum assets cover of 1.33X basis cumulative property value of Escorts Heart and Super Speciality Hospital Limited (immovable property situated in Mohali), International Hospital Limited (immovable property situated in Faridabad and Noida), Hospitalia Eastern Private Limited (immovable property situated in Ludhiana), Fortis Hospotel Limited (immovable property situated in Gurugram). Further, overdraft facility is secured by first pari passu charge on the current assets and movable fixed assets of the borrower (Company) and corporate guarantee from Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Escorts Heart and Super Speciality Hospital Limited, Hospitalia Eastern Private Limited, Fortis Hospitals Limited and Fortis Hospotel Limited with rate of interest being HSBC overnight MCLR 70 bps payable monthly or any other rate as may be agreed from time to time. As on March 31, 2021, the outstanding balance of overdraft is '' 1,733.23 Lakhs. (Balance outstanding as at March 31, 2020 was '' 8,375.57 Lakhs).

(i) Assets given on operating lease:

The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. The total lease income received / receivable in respect of the above leases recognised in the Statement of Profit and Loss for the year are '' 187.44 Lakhs (March 31, 2020 '' 19.14 Lakhs).

The Company has also leased out certain property, plant and equipment on operating lease to a trust managing hospital operations. The lease term is for 3 years and thereafter renewable at the option of the lessor. The total lease payment received in respect of such leases recognised in the statement of profit and loss for the year are '' 638.96 Lakhs (March 31, 2020''631.78 Lakhs).

During the current year, the Company has availed overdraft facility of '' 5,000 Lakhs from DBS Bank Limited with interest rate of Bank''s 3-month MCLR plus 100 bps margin with quarterly reset payable on monthly basis which is secured by:

(i) First pari passu charge over current assets and moveable fixed assets of the borrower (except vehicles under specific charge with ICICI and Kotak bank),

(ii) Exclusive charge over immovable fixed assets of International Hospital Limited located at Anandpur, Kolkata and BG Road, Bengaluru and Escorts Heart and Super Speciality Hospital Limited located at Jaipur, Rajasthan with a security cover of minimum 1.33x,

As on March 31, 2021, the outstanding balance of overdraft is '' 2.22 Lakhs. (Balance outstanding as at March 31, 2020 Nil)

(b) During the year, the Company has availed working capital loan of '' 6,000 Lakhs for meeting day to day working capital requirements. The loan is secured against pari-pasu charge on the current assets of the borrower. The rate of interest is HSBC 3-month MCLR plus 50 bps with quarterly reset or any other rate as may be mutually agreed from time to time. As on March 31, 2021, the outstanding balance of loan is '' 4,000 Lakhs.

(c) During the previous year, the Company has taken term loan for '' 64,483.00 Lakhs secured by exclusive charge on the fixed assets ( immovable ) with minimum assets cover of 1.33X basis cumulative property value of Escorts Heart and Super Speciality Hospital Limited (immovable property situated in Mohali), International Hospital Limited (immovable property situated in Faridabad and Noida), Hospitalia Eastern Private Limited (immovable property situated in Ludhiana), Fortis Hospotel Limited (immovable property situated in Gurugram), corporate guarantee from Escorts Heart Institute and Research Centre Limited, International Hospital Limited, Escorts Heart and Super Speciality Hospital Limited, Hospitalia Eastern Private Limited, Fortis Hospitals Limited and Fortis Hospotel Limited and first pari passu charge on the current assets and movable fixed assets of the borrower (Company) with rate of interest being MCLR i.e. 8.10% plus 50 bps with quarterly reset linked to 3 month MCLR or any other rate as may be mutually agreed from time to time.

During the year, the Company has partly refinance the HSBC term loan facility of '' 2,075.82 Lakhs from DBS Bank Limited (outstanding balance of term loan facility from HSBC Bank Limited as at March 31, 2020 was '' 2,503.00 Lakhs). Also, the Company has availed the term loan facility of '' 4,096.49 Lakhs from HSBC Bank Limited.

Out of total term loan facilities, '' 30,000.00 Lakhs is repayable in 5 years in 3 annual equal instalments starting financial year 2022-23, '' 29,480.00 Lakhs is repayable in 11 years with put/call option exercisable on or after September 05, 2022, '' 6,596.49 Lakhs is repayable in 7 years in 24 equal quarterly instalments. As on March 31, 2021, the outstanding balance of term loans are '' 63,822.86 Lakhs (Balance outstanding as at March 31, 2020 was '' 63,550.77 Lakhs).

(d) During the current year, the Company has taken term loan of '' 2,283.62 Lakhs from DBS Bank Limited with interest rate of Bank''s 3-month MCLR plus 100 bps margin with quarterly reset payable on monthly basis which is secured by:

(i) First pari passu charge over current assets and moveable fixed assets of the borrower (except vehicles under specific charge with ICICI and Kotak bank),

Out of total term loan facility of '' 2,283.62 Lakhs aforesaid, term loan facility of '' 2,075.82 Lakhs was availed for refinancing of existing credit facility from HSBC Bank Limited. The loan is repayable in 4 years 9 months with demand option exercisable on or after September 01, 2023 and remaining term loans facility taken for Capex of '' 207.80 Lakhs is repayable in 16 quarterly instalments starting from December 01, 2021 with demand option exercisable on or after September 01, 2023. As on March 31,2021, the outstanding balance of term loans including capex loans are '' 2,109.45 Lakhs.

(e) During the previous year, the Company has taken vehicle loan for '' 68.26 Lakhs from Kotak Mahindra Prime Limited with current average rate of interest of 9.27% p.a. The loan is repayable in 48 structured monthly instalments and secured against hypothecation of the specific vehicle purchased. As on March 31,2021, the outstanding balance of vehicle loan is '' 35.32 Lakhs (Balance outstanding as at March 31, 2020 was '' 61.96 Lakhs).

(f) During the current year, the Company has taken vehicle loan for '' 93.46 Lakhs from ICICI Bank Limited with current average rate of interest of 7.60% p.a. The loan is repayable in 48 structured monthly instalments and secured against hypothecation of the specific vehicle purchased As on March 31,2021, the outstanding balance of vehicle loan is '' 92.72 Lakhs.

b. As part of Sponsor Agreement entered between The Trustee-Manager of RHT Health Trust (formerly known as Religare Health Trust), Fortis Global Healthcare Infrastructure Pte. Limited and Hospital Service Companies (collectively for International Hospital Limited, Fortis Hospotel Limited, Escorts Heart and Super Specialty Hospitals Limited and Fortis Health Management Limited) (collectively referred as ''Indemnified parties'') with the Company, the Company has undertaken to indemnify ("Tax Indemnity") each of the Hospital Services Companies and their respective directors, officers, employees and agents (the "Investing Parties") against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies. Accordingly, Company has accrued '' 205.03 Lakhs (as at March 31, 2020''205.03 Lakhs) as provision for contingency.

d. These were no amount which were required to be transferred to be the investor education and protection fund by the Company.

10 Tax expense for the previous year ended March 31, 2020 includes the recognition of deferred tax asset (DTA) of '' 3,578.83 Lakhs due to change in management assessment of DTA recoverability based on projections of future taxable profits. The management continues to reassess the DTA recoverability at each period end.

11. | CONTINGENT LIABILITIES TO THE EXTENT NOT PROVIDED FOR:A. Guarantees:

Outstanding guarantees furnished to banks on behalf of the subsidiary companies are '' 143,705.00 Lakhs (Previous year '' 127,325.00 Lakhs). The Company has recorded in books the fair value of guarantees given to subsidiary companies. (Refer note 5(v)).

B. Claims against the Company, disputed by the Company, not acknowledged as debt (In addition, refer claims assessed as contingent liability described in Note 12, 26, 27 and 28 below):

('' in Lakhs)
Particulars	As at
Particulars	March 31, 2021	March 31, 2020
Income tax	4,475.58	4,224.41
Medical related	5,496.02	5,038.67
VAT	3,621.17	3,621.17
Service Tax and GST	537.00	559.00
Grand Total	14,129.77	13,443.25

(i) On 28 February 2019, a judgment of the Supreme Court of India interpreting certain statutory defined contribution obligations of employees and employers (the "India Defined Contribution Obligation") altered historical understandings of such obligations, extending them to cover additional portions of the employee''s income to measure obligations under employees Provident Fund Act, 1952. There is significant uncertainty as to how the liability should be calculated as it is impacted by multiple variables, including the period of assessment, the application with respect to certain current and former employees and whether interest and penalties may be assessed. The Company has been legally advised not to consider that there is any probable obligations for periods prior to date of aforesaid judgment.

(ii) In relation to a judgement passed by Hon''ble Supreme Court of India on January 29, 2016, Central Government constituted a Committee to make recommendations for improvement of working conditions and pay of nurses in private hospitals and nursing homes which could be implemented by way of legislation. The Committee constituted by Ministry of Health and Family Welfare, Government of India made certain recommendations and pursuant thereto Government of NCT of Delhi passed an order dated June 25, 2018 directing all private hospitals /nursing homes in Delhi to comply with the recommendations of the Committee and submit compliance report. Said order was challenged by Association of Healthcare Providers (India) ("AHPI") on behalf of its members including the Company by filing a Writ Petition before Hon''ble High Court of Delhi which was dismissed vide order dated July 24, 2019. Subsequently, AHPI has appealed against the order dated July 24, 2019 before division bench of Delhi High Court which is pending adjudication. The impugned orders and the pending proceedings pertain to all hospitals and nursing homes in Delhi. The Company has informed AHPI that it is in compliance of the applicable Minimum Wages Act. Based on advice from external counsels, Company believes that it has a good case on merits and the order dated June 25, 2018 passed by Government of NCT of Delhi in all likelihood will not adversely financially impact the Company. Additionally, the Company is involved in other disputes, lawsuits, claims, governmental and/or regulatory inspections, inquiries, assessments and proceedings, including commercial matters that arise from time to time in the ordinary course of business.

12. | CLAIMS ASSESSED AS CONTINGENT LIABILITY AND NOT PROVIDED FOR, UNLESS OTHERWISE STATED

A party (to whom the ICDs were assigned) ("Plaintiff") has filed a Civil Suit before the District Court, Delhi in February 2018 against various entities including the Company (together "the defendants") and has, inter alia, claimed implied ownership of brands "Fortis", "SRL" and "La Femme" in addition to certain financial claims and for passing a decree alleging that consequent to a Term Sheet dated December 6, 2017 (''Term Sheet'') between the Company and a Third Party, the Company is liable for claims owed by the Plaintiff to the Third Party. In connection with this, the District Court passed an ex-parte order directing that any transaction undertaken by defendants, in favour of any other party, affecting the interest of the Plaintiff shall be subject to orders passed in the said suit. A Third Party has sought to be substituted as a Plaintiff in the District Court proceedings.

The Company has filed written statement denying all allegations made against it and prayed for dismissal of the Civil Suit on various legal and factual grounds. The Company has in its written statement also stated that it has not signed the alleged Term Sheet with the Third Party. The matter is pending adjudication before District Court, Delhi. The Third Party had approached Delhi High Court for seeking certain interim reliefs against the Company under the provisions of The Arbitration and Conciliation Act, 1996. This Third party had also filed a claim for damages and injunctive reliefs against the Company before International Chamber of Commerce (ICC). The Company has invited the attention of ICC to the aforesaid pending litigations before various Courts and non-maintainability of claim raised by said Third party. Proceedings before Delhi High Court have been withdrawn by Third Party on February 24, 2020. Further, arbitration before ICC has also been withdrawn by Third Party on February 23, 2020 and the same has been closed by ICC on February 28, 2020. The Company has filed an application for perjury against the Third Party and other entities which is pending before the Delhi High Court.

In addition to the above, the Company had also received four notices from the Plaintiff claiming (i) '' 1,800 Lakhs as per notices dated May 30, 2018 and June 1,2018 (ii) '' 21,582 Lakhs as per notice dated June 4, 2018; and (iii) '' 1,962 Lakhs as per notice dated June 4, 2018. All these notices have been responded to by the Company denying any liability whatsoever.

Allegations made by the Third party have been duly responded to by the Company denying (i) execution of any binding agreement with the Party and (ii) liability of any kind whatsoever.

13. | EMPLOYEE STOCK OPTION PLAN

The Company has provided share-based payment scheme to the eligible employees and then directors of the Company/ its subsidiaries and erstwhile Holding Company. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company.

As at March 31, 2021, no scheme was in operation as all options granted have lapsed / forfeited.

Expected volatility has been determined considering the daily volatility of the stock prices on National Stock Exchange, over a period prior to the date of grant, corresponding with the expected life of the options.

On the date of transition to Ind AS (i.e. April 1, 2015), the Company had opted for optional exemption available under Ind AS 101 ''First time adoption'' and not recorded any stock option outstanding account for the options fully vested as at transition date.

Note:

1. During the year, the Company has recognised expense in relation to employee stock option plan of '' Nil (Previous year '' Nil).

2. In respect of fully vested option forfeited during the year, amount aggregating to '' 90.06 Lakhs (Previous year '' 2,545.67 Lakhs) has been transferred to general reserve.

3. In respect of fully vested options exercised during the year, amount aggregating to '' Nil (Previous year 2.14 Lakhs ) has been transferred to general reserve.

14. | EMPLOYEE BENEFITS PLAN:

Defined Contribution Plan

The Company recognised '' 163.17 Lakhs (Previous year '' 163.46 Lakhs) for Provident Fund and Employee State Insurance Contribution in the Statement of Profit and Loss. The Contribution payable to the plan by the Company is at the rate specified in rules to the scheme.

Defined Benefit Plan

(i) Gratuity

The following table summarises the components of net benefit expenses recognised in the Statement of Profit and Loss and the amounts recognised in the Balance Sheet.

a) The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

b) Significant actuarial assumption for the determination of the defined obligation are discount rate, expected salary escalation rate and withdrawal rate. The sensitivity analyses below have been determined by the actuarial based on reasonably possible changes of the respective assumption occurring at the end of the reporting period, while holding all other assumptions constant.

(ii) Provident Fund:

The Company makes monthly contributions to provident fund managed by trust for qualifying employees. Such contributions for the year ended March 31, 2021 are '' 606.53 Lakhs (Previous year '' 670.14 Lakhs). Under the scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. As per Ind AS 19 on "Employee Benefits", employer established provident fund trusts are treated as defined benefit plans, since the Company is obliged to meet interest shortfall, if any, with respect to covered employees.

15. | FINANCIAL INSTRUMENTS i) Capital Management

The Company manages its capital to ensure that the Company will be able to continue as going concern while maximizing the return to stakeholders through the optimisation of the debt and equity balance.

The capital structure of the Company consists of net debt (borrowings as detailed in notes 5(xvi), 5(xvii) and 5(xix) offset by cash and bank balances) and total equity of the Company.

The Company is not subject to any externally imposed capital requirements other than for covenants under various loan arrangements of the Company.

The Company''s Board reviews the capital structure of the Company on need basis. As part of this review, the Board considers the cost of capital and the risks associated with each class of capital.

(ii) Financial risk management objectives

Market Risk

The Company''s activities expose it primarily to the financial risks of changes in interest rates and foreign currency exchange rates.

a) Foreign currency risk management

b) Interest rate risk management

Interest rate sensitivity analysis

Foreign currency sensitivity analysis

The Company is mainly exposed to USD currency.

The following table details the Company''s sensitivity to a 5% increase and decrease in the '' against USD. 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. A positive number below indicates an increase in profit or equity where the ''. strengthens 5% against USD. For a 5% weakening of the '' against USD, there would be a comparable impact on the profit or equity, and the balances below would be negative.

c) Other price risks

The Company investment are in group companies and are held for strategic purposes rather than for trading purposes.

d) Credit risk management

The Company does not have any significant concentration of exposures to specific markets.

Refer note 5(vi) of the standalone financial statements for carrying amount and maximum credit risk exposure for trade receivables.

Expected credit loss on financial assets other than trade receivables:

Company carries other financial assets such as balances with banks, inter-corporate deposits, advances, security deposits, loans to body corporates and interest accrued on such loans etc. Company monitors the credit exposure on these financial assets on a case-to-case basis. Loans to subsidiaries are assessed for credit risk based on the underlying valuation of the entity and their ability to repay within the contractual repayment terms. Company creates loss allowance wherever there is an indication that credit risk has increased significantly.

e) Liquidity risk management

Liquidity and interest risk tables

(a) Fair valuation of financial assets and liabilities with short term maturities is considered as approximate to respective carrying amount due to the short-term maturities of these instruments.

(b) Fair valuation of non-current financial assets has been disclosed to be same as carrying value as there is no significant difference between carrying value and fair value.

(d) Fair value measurement of lease liabilities is not required.

The fair value is determined by using the valuation model/technique with observable/ non-observable inputs and assumptions.

There are no transfers between Level 1, Level 2 and Level 3 during the year ended March 31, 2021 and March 31, 2020.

*excludes investment in subsidiaries of '' 785,557.25 Lakhs (Previous year '' 707,287.35 Lakhs) which are shown at carrying

value (net of impairment) in balance sheet as per Ind AS 27 "Separate Financial Statements".

Financial instruments measured at amortised cost

17 The disclosures regarding details of specified bank notes held and transacted during the period November 8, 2016 to December 31, 2016 have not been made since the requirement does not pertain to financial year ended March 31, 2021.

18. | EXCEPTIONAL ITEMS (ALSO REFER NOTE 20)

(a) Allowance of '' Nil (Previous year '' 6.00 Lakhs) recognised for doubtful loan recoverable from Fortis La Femme Limited due to inability to pay by the subsidiary.

(b) The Company has an investment aggregating to '' 15,105.47 Lakhs in Fortis Healthcare International Limited and '' 71,919.75 Lakhs in Escorts Heart Institute and Research Centre Limited which are wholly owned subsidiaries.

As at 31 March 2021, the enterprise value of Fortis Healthcare International Limited has been determined based on the quoted market value (Level 1 fair value) of its underlying asset (Lanka Hospitals Corporation PLC). Based on this value, the management has recorded an impairment loss of '' 694.60 Lakhs towards the amount invested in Fortis Healthcare International Limited. During the previous year, based on its impairment test and considering the recoverable value of these investment, the Company has recognised impairment loss of '' 2,507.90 Lakhs and '' 10,348.67 Lakhs towards amount invested in Fortis Healthcare International Limited and Escorts Heart Institute and Research Centre Limited respectively.

As at March 31, 2020, the recoverable amount of these investments was determined based on value-in-use calculations which uses discounted cash flow projections and Earnings before Interest, Depreciation and Amortisation ("EBITDA") multiple for one step-down investment. The fair value measurement has been categorised as Level 3 fair value based on the inputs to the valuation technique used.

~20 During the current year, the COVID - 19 pandemic impacted the revenues and profitability of the Company with a decline in occupancy impacting significantly the hospital business revenues, profitability and cash flows. The Company took various initiatives to support operations and optimise the cost. With a slew of these measures, the Company has been able to significantly reduce the negative impact on business.

The Company has a well- capitalised Balance Sheet and has managed its liquidity position via cost efficiency initiatives, better working capital management and external funding.

During the last quarter of the curent year, the Company has further witness improvement in business. It has gradually moved towards normalisation of business during the course of the current financial year. The Company has considered internal and external information while finalizing various estimates in relation to these financial statements. Going forward, the actual impact of the COVID-19 pandemic may still be different from that what has been estimated, as the COVID-19 situation is further evolving in India and globally and with the surge in number of cases in India.

As a part of its strategy to counter the impact of COVID-19 pandemic, with cost saving measures the Company got approval from its shareholders to seek waiver of fixed service fee payable to its certain subsidiaries under the Hospital & Medical Service Agreements (HMSA) entered with the said subsidiaries for at least two quarters (April-June 2020 and July-Sep 2020) assuming that the hospital operations, occupancy and footfall will return to normalcy by October 2020. However, if the business did not recover to normal levels by October 2020, then the waiver period could be extended until business become normal with the consent of both the Company and its subsidiaries. Accordingly 50% waiver of fixed service fee for the third quarter (Oct-Dec 2020) was approved by the subsidiaries keeping in view the continued exceptional and unforeseen circumstances. In line with guidance on accounting for such concessions that are a direct consequence of the COVID-19 pandemic, the Company has recognised an exceptional gain of '' 6,340.35 Lakhs for the year ended March 31, 2021. Further, the Company is and will continue to closely monitor any material changes to future economic conditions.

21. | DETAILS OF DUES TO MICRO AND SMALL ENTERPRISES AS PER MSMED ACT, 2006

The Ministry of Micro and Small Enterprises has issued an office memorandum dated August 26, 2008 which recommends that the micro enterprises and the small enterprises should mention in their correspondences with their customers the Entrepreneur Memorandum Number as allocated after filing of the memorandum. Accordingly, the below information regarding dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information available with the Company

During the year, the Company has transferred '' 6.83 Lakhs (Previous year '' 4.68 Lakhs) to the cost of capital work in progress __ (CWIP).

24. | CORPORATE SOCIAL RESPONSIBILITY

As per section 135 of the Companies Act, 2013 and rules therein, the Company is required to spend at least 2% of average net profit of preceding three years towards Corporate Social Responsibility (CSR). Details of Corporate social responsibility expenditure as certified by Management are as follows:

('' in Lakhs)
Particulars	March 31, 2021	March 31, 2020
Average net profit of the Company for the last three financial years	25,471.07	1,876.31
Prescribed CSR expenditure (2% of the average net profit as computed above)
Total amount to be spent for the financial year	509.42	37.53
Amount spent	509.42	37.53
Amount unspent	-	-

25. | RECOVERABILITY OF CERTAIN ADVANCES / CAPITAL WORK-IN-PROGRESS

(Also refer to Note 27 of the Standalone Financial Statements)

The Company had paid security deposits and advances aggregating to '' 2,173.57 Lakhs in FY 2013-14 to a private Company ("Lessor") towards lease of office space. Due to delays in obtaining occupancy certificate (OC), the lease agreement / MOUs were either terminated by the Company or expired during FY 2017-18. The amounts outstanding from the Lessor as on March 31, 2018 aggregated to '' 2,173.57 Lakhs. Additionally, expenditure aggregating to '' 2,569.90 Lakhs was incurred towards capital work-in-progress on the premises proposed to be taken on lease from the Lessor, which is also being claimed from the Lessor pursuant to the aforesaid termination. The Company has issued legal notice demanding the outstanding. Lessor responded to the notice of the Company for amicable resolution, which have not yet yielded any results. Further, Company has filed claim before Interim Resolution Professional (IRP) appointed by NCLT in a matter filed by one of creditors of Lessor. IRP is currently adjudicating the claims of various creditors of the Lessor including that of the Company.

26 The Board of Directors, after seeking inputs from reputed investment bankers, had approved an equity infusion of '' 400,000 Lakhs at a price of '' 170 per equity share into the Company by Northern TK Venture Pte Limited Singapore (NTK) ("Acquirer"), a wholly owned subsidiary of IHH Healthcare Berhad, Malaysia through a preferential allotment ("Preferential Issue"), subject to approval of the shareholders and other regulatory approvals which constituted 31.1% share capital of the Company. The shareholders of the Company approved the Preferential Issue by requisite majority at their Extra Ordinary General Meeting dated August 13, 2018. The Acquirer had received the approval from Competition Commission of India (CCI) on October 30, 2018 and the preferential allotment was made on November 13, 2018. Pursuant to the consummation of the same, Northern TK Venture Pte Limited, had appointed 2/3 of the directors on the Board of Directors of the Company, thereby acquiring control over the Company. Consequently, the Company has become a subsidiary of Northern TK Venture Pte Limited Further, pursuant to the Preferential Issue, Northern TK Venture Pte. Limited is under an obligation to make a mandatory open offer to the public shareholders of the Company and Fortis Malar Hospitals Limited in accordance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. However, in view of order dated December 14, 2018 passed by Hon''ble Supreme Court wherein it was specified that status quo with regard to sale of the controlling stake in Fortis Healthcare Limited to Malaysian IHH Healthcare Berhad be maintained, the Mandatory Open offer was kept in abeyance and continues to be in abeyance as on date, and remains subject to further orders by the Hon''ble Court. The Company had accordingly filed an application seeking for modification of the said order.

Vide its judgement dated November 15, 2019, the Hon''ble Supreme Court has issued suo- moto contempt notice to, among others, the Company and directed its Registry to register a fresh contempt petition in regard to alleged violation of the its order dated December 14, 2018. In this respect, the Hon''ble Supreme Court has sought an enquiry, into (i) whether the subscription by the Acquirer to the shares of the Company was undertaken after the status quo order was issued by the Hon''ble Court on December 14, 2018 and accordingly, if such subscription was in violation of this status quo order; and (ii) the consummation of the acquisition of healthcare assets from RHT Health Trust by the Company.

Further, at the request of SEBI by way of an application seeking impleadment, the Hon''ble Supreme Court of India has impleaded SEBI as a party in the petition pending before it. SEBI has prayed for allowing the Mandatory Open Offer. Further, the Hon''ble Supreme Court of India has issued notice on application filed by a public shareholder of the Company seeking impleadment. The public shareholder has inter alia prayed for allowing the Mandatory Open Offer. NTK has also filed an application for impleadment, modification of the status quo order and for proceeding with Mandatory Open Offer.

While the matter is currently sub-judice and we await the orders/ directions of the Hon''ble Supreme Court in this regard, in view of the legal positions/claim(s) made and defence(s) raised by the Company, basis external legal advice, the management believes that it has a strong case on merits. It is the view of the Company these transactions were, at all times, conducted in a fair and transparent manner after obtaining all relevant regulatory and shareholders approval and only after making all due disclosures to public shareholders of the Company and to the regulatory authorities, in a timely manner. As per the current position of the case, liability, if any, arising out of this contingency cannot be determined at this stage. Accordingly, at present, no adjustment is required in the Standalone Financial Statements.

Further during the quarter ended September 30, 2020, in view of the aforesaid suo moto contempt notice, for abundant caution, an application was filed by the Company before the Hon''ble Supreme Court of India, praying for permission to it and its subsidiaries for changing their respective names, brands and logos; and for continued usage of the same if the said application was not disposed of prior to expiry of the term of the Brand License Agreements to allow adequate time for smooth Brand transition without any disruption to business. Subsequent to the year end, the Brand License Agreements have expired. The Company is awaiting order(s) of the Hon''ble Supreme court.

27. | INVESTIGATION INITIATED BY THE ERSTWHILE AUDIT AND RISK MANAGEMENT COMMITTEE:

A. Background

(i) As disclosed in the financial statements for the years ended March 31, 2018, March 31, 2019 and March 31, 2020, during the year ended March 31 2018, there were reports in the media and enquiries from, inter alia, the stock exchanges received by the Company about certain inter- corporate loans given by a wholly owned subsidiary of the Company. The erstwhile Audit and Risk Management Committee of the Company decided to carry out an independent investigation through an external legal firm on this matter. The terms of reference of the investigation, inter alia, comprised: (i) ICDs amounting to a total of '' 49,414 Lakhs (principal), placed by the Company''s wholly-owned subsidiary, FHsL, with three borrowing companies as on July 1, 2017 ; (ii) the assignment of these ICDs to a third party and the subsequent cancellation thereof as well as evaluation of legal notice (now a civil suit) received from such third party ; (iii) review of intra-group transactions for the period commencing FY 2014-15 and ending on December 31, 2017; (iv) investments made in certain overseas funds by the overseas subsidiaries of the Company (i.e. Fortis Asia Healthcare Pte. Limited, Singapore and Fortis Global Healthcare (Mauritius) Limited); (v) certain other transactions involving acquisition of Fortis Healthstaff Limited ("Fortis Healthstaff") from an erstwhile promoter group Company, and subsequent repayment of loan by said subsidiary to the erstwhile promoter group Company. The investigation report was submitted to the re-constituted Board in June 2018.

In order to overcome the above, additional procedures/ enquiries were initiated as below.

B. Additional procedures/enquiries by the reconstituted Board

(i) The Company''s Board of Directors initiated additional procedures/ enquiries of certain entities in the Group that were impacted in respect of the matters investigated by the external legal firm. Pending the additional procedures/ enquiries ("Additional Procedures/ Enquiries") and since the investigation was subject to the limitations on the information available to the external legal firm and their qualifications and disclaimers as described in their investigation report, as disclosed in the audited financial statements for the years ended March 31, 2018, March 31, 2019 and March 31, 2020 certain audit qualifications were made in respect of FHL''s financial statements for those financial years, as the statutory auditors were unable to comment on the nature of those matters, the provisions established thereof, or any further potential impact on the financial statements. In order to resolve the same, the Board mandated the management to undertake review of certain areas in relation to historical transactions for the period April 1, 2014 to September 30, 2018 involving additional matters by engaging independent experts with specialised forensic skills to assist with the Additional Procedures/Enquiries and provide inputs and expert advice in connection therewith. The independent experts submitted their report which was discussed and considered by the Board in its meeting held on September 16, 2020.

(ii) The Board noted that the Additional Procedures/Enquiries, prima facie, revealed further instances of payments made to the erstwhile promoter or to their directly or indirectly related parties including erstwhile promoter group entities which were improper. However, all of the amounts identified in the Additional Procedures/Enquiries had been previously provided for or expensed in the financial statements of FHL or its subsidiaries. There are no other improper transactions identified by the Additional Procedures/Enquiries or the management which had not been expensed or provided.

(iii) In connection with the potentially improper transactions, the Company has undertaken a detailed review of each case to assess the Company''s legal rights and has initiated necessary action.

C. Key findings during the investigation by the external legal firm and during the Additional Procedures/Enquiries

by independent experts

Promoter Group with effect from December 15, 2017. These borrowers continued to be related parties until February 16, 2018. subsequent to which the shareholding of the erstwhile Promoter Group in the Company was reduced to 0.77%. In terms of agreements dated September 30, 2017, FHsL assigned the outstanding ICDs to a third party. Such assignment was subsequently terminated on January 5, 2018. On February 28, 2018, these ICDs were secured by way of a duly registered charge on the present and future assets of the Borrowers. ICDs aggregating to '' 44,503 Lakhs including interest accrued thereon of '' 4,260 Lakhs calculated up to March 31, 2018 remained outstanding. In view of the uncertainty in realisability of the security and/or collection of the amounts, the outstanding amount was fully provided during the year ended March 31,2018.

The Investigation Report indicated that the placement of the ICDs, including the method of such placement, their subsequent assignment and the cancellation of such assignment were done without following the normal treasury operations and treasury mandate; and without specific authorisation by the Board of FHsL. (Also refer note 28 on SEBI Order).

(ii) The Company had paid security deposits and advances aggregating to '' 2,173.57 Lakhs in FY 2013-14 to a private Company ("Lessor") towards lease of office space. Due to delays in obtaining occupancy certificate (OC), the lease agreement / MOUs were either terminated by the Company or expired during FY 2017-18. The amounts outstanding from the Lessor as on March 31, 2018 aggregated to '' 2,173.57 Lakhs. Additionally, expenditure aggregating to '' 2,569.90 Lakhs was incurred towards capital work-in-progress on the premises proposed to be take on lease from the Lessor, which is also being claimed from the Lessor pursuant to the aforesaid termination. The Company has issued legal notice demanding the outstanding. Lessor responded to the notice of the Company for amicable resolution, which has not yet yielded any results. Further, Company has filed claim before Interim Resolution Professional (IRP) appointed by NCLT in a matter filed by one of creditors of Lessor. IRP is currently adjudicating the claims of various creditors of the Lessor including that of the Company.

(iii) FHsL, a wholly owned subsidiary of the Company, had advanced moneys to an entity towards acquisition of property in Mumbai in FY 2013-14 which did not materialise. Of the total advance of '' 10,000 Lakhs, balance of '' 2,375 Lakhs was outstanding to be received back. Post-dated cheques received from the entity were dishonoured, and FHsL initiated legal proceedings in this regard. FHsL had accrued for the interest amounting to '' 174 Lakhs up to March 31, 2018 on the advance for the purpose of including the same in the legal claim on the entity. However, in line with applicable accounting norms, interest thereon for the period subsequent to March 31, 2018 was not accrued considering the uncertainties around ultimate realisation of the amounts.

Mar 31, 2018

Notes:

1) As the future liability for gratuity and leave encashment is provided on actuarial basis for the Company as a whole, the amount pertaining to the directors is not ascertainable and, therefore, not included above. The figures do not include accrual recorded for Employee Share Based Payments.

2) The loans availed by above companies against guarantee given have been used by the respective companies for acquiring Property, plant and equipment and meeting working capital requirements.

3) Transactions with these parties have been shown for the full year due to practical difficulties in ascertaining the transactions for part of the year. The closing balances have not been reported as the relationship ceased to exist as at the balance sheet date.

4) Fortis Healthcare Holdings Private Limited (âFHHPLâ) ceased to be the parent company of the Company w.e.f. May 10, 2017 since its shareholding was reduced to 34.33%. However, Mr Malvinder Mohan Singh, Executive Chairman of the Company till his resignation on February 8, 2018 (accepted by the Board in its meeting held on February 13, 2018 w.e.f. February 8, 2018) directly/indirectly controlled one half of the shareholding of FHHPL. Therefore by virtue of Ind AS-110 - Consolidated Financial Statements, FHHPL continued to be the parent Company of the Company till the resignation of Mr. Malvinder Mohan Singh. Subsequent to the resignation of Mr. Malvinder Mohan Singh, by virtue of its shareholding being more than 20%, FHHPL still continued to exercise significant influence over the Company till 16th February 2018 when consequent to the order of Honâble Supreme Court of India, the shares pledged by FHHPL were revoked by its lenders and the shareholding of FHHPL reduced to 0.66%.

5) Related party relationships as required under Ind AS 24 - Related Party Disclosures and the Companies Act, 2013 are as identified by the Management taking into account the findings and limitations in the Investigation Report (Refer Notes 30 (d) (iv), (ix) and (x) below) and the information available with the Management. In this regard, in the absence of specific declarations from the erstwhile directors on their compliance with disclosures of related parties, especially considering the substance of the relationship rather than the legal form, the related parties have been identified based on the declarations by the erstwhile directors and the information available through the known shareholding pattern in the entities. Therefore, there may be additional related parties whose relationship may not have been disclosed to the Company and, hence, not known to the Management.

6) Amount shown is inclusive of perquisites (including ESOP exercise, if any), employerâs contribution to provident fund and excluding reimbursement of expenses.

7) Amount shown for the year ended 31 March, 2016 excludes one-time joining bonus of '' 723.41 lacs which was paid during the year ended 31 March, 2016. The aforementioned joining bonus was accrued and disclosed during the year ended 31 March, 2015.

7) Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises, few medical equipmentâs and other premises are obtained on operating lease. The total lease payments in respect of such leases recognized in the Statement of Profit and Loss for the year are '' 1,020.15 lacs (Previous year 2016-17 '' 999.82 lacs).

(b) Assets given on Operating Lease

i) The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. The total lease income received / receivable in respect of the above leases recognized in the Statement of Profit and Loss for the year are '' 25.27 lacs (FY 2016-17 '' 3.97 lacs).

The total lease payments received in respect of such leases recognized in the Statement of Profit and Loss account for the year are '' 639.03 lacs (Previous year 2016-17 '' 641.38 lacs).

(a) The loan has been taken from HDFC Bank Limited in the financial year 2015-16. The loan is secured by a first pari passu charge by way of hypothecation of the Companyâs movable fixed assets. The rate of interest is HDFC Bank Base Rate of the bank plus 0.85% per annum, payable monthly. The loan is repayable in 52 structured monthly installments commencing from October 1, 2015. As at March 31, 2018, '' 3,487.77 lacs (as at March 31, 2017 '' 5,323.42 lacs) is outstanding. The current effective average rate of interest is 9.70% p.a. (Previous year 9.85% p.a.)

(b) Term loan from Yes Bank has been taken in financial year 2016-17 for purchase of various medical equipmentâs and is secured by hypothecation on invoices and insurance copies of that medical equipmentâs. The rate of interest is 0.50% per annum over and above yearly MCLR, payable monthly. The loan is repayable in 26 structured quarterly installments, after a moratorium period of 180 days from the date of disbursement to the Company. As at March 31, 2018, '' 3,515.95 lacs (as at March 31, 2017 '' 1621.15 lacs) is outstanding. The current effective average rate of interest is 9.35% p.a. (Previous year 9.45% p.a.)

(c) The short term loan has been taken in current year from Standard Chartered Investments & Loans (India) limited for the purpose of working capital and is secured by share pledge of the Company 21% shareholding in Fortis Hospitals Limited. Standard Chartered Investments & Loans (India) Limited has the right to revise the specified rate at its discretion on the interest reset dates. The loan is repayable in maximum 90 days from the date of disbursement to the Company and no rollover of the same is permitted.

During the year ended 2016-17, short term loan has been taken from Standard Chartered Investments & Loans (India) limited for the purpose of working capital and was secured by share pledge of the FHL 51% shareholding in Fortis Hospitals Limited and personal guarantee of Mr. Malvinder Mohan Singh. Standard Chartered Investments & Loans (India) Limited had the right to revise the specified rate at its discretion on the interest reset dates. The loan was repayable in maximum nine months from the date of disbursement to the Company and the same have been repaid fully.

As at March 31, 2018, the balance of the loan '' 1,000 lacs (as at March 31, 2017 10,000 lacs) is outstanding. The current effective average rate of interest is 10.00% p.a.

(d) The overdraft facility has been availed from Standard Chartered Bank. Overdraft limit of Rs, 4,000 lacs (As at March 31, 2017 Rs, 4,000 lacs) and secured by pari passu charge over moveable fixed assets at Mohali hospital and current assets of the Company. The rate of interest is Base rate plus margin, as may be agreed from time to time. The current effective average rate of interest is 11.25% p.a.

During the year the Company has overdraft facility from Yes bank. Overdraft limit of Rs, 5,000 lacs (As at March 31, 2017 Rs, nil) and secured by exclusive charge on 30% shares of Fortis Hospitals Limited, pari passu charge over moveable fixed assets of the Company, current assets of the Company and exclusive charge on the Land and Building of hospitals of Ludhiana and Vasant Vihar. The rate of interest is Base rate plus margin, as may be agreed from time to time. The current effective average rate of interest is 9.40% p.a.

Further the Company have taken overdraft facility from RBL Bank. Overdraft limit of Rs, 1,000 lacs (As at March 31, 2017 Rs, nil) and secured by first pari pasu charge on current assets of the Company. The rate of interest is 1 year MCLR. The current effective average rate of interest is 12.00 % p.a.

(e) The short term loan from Standard Chartered Bank in the financial year 2017-18 for the purpose of working capital and is secured by share pledge of the FHL 30% shareholding in Fortis Hospitals Limited on First charge basis and fixed deposits provided by third party. The rate of interest is MCLR plus applicable margin, as may be agreed from time to time. The loan is repayable in maximum 90 days from the date of disbursement to the Company and no rollover of the same is permitted.

During the year ended 2016-17, short-term loan had been taken from Standard Chartered Bank for the purpose of working capital and fully paid in the current financial year. The loan was secured by pari passu charge over moveable fixed assets at Mohali hospital, current assets of the Company and personal guarantee of Mr. Malvinder Mohan Singh. The rate of interest is MCLR plus applicable margin, as may be agreed from time to time. The loan was repayable in maximum four months from the date of disbursement to the company which have been fully paid.

As at March 31, 2018, the balance of the loan Rs, 10,200 lacs (as at March 31, 2017 Rs, 2,500 lacs) is outstanding. The current effective average rate of interest was 10.00% p.a.

(f) Term loan from Siemens Financial Services Private Limited has been taken in financial year 2016-17 for purchase of medical equipmentâs and is secured by exclusive charge by way of hypothecation of that medical equipmentâs, along with all standard accessories. The rate of interest is 7.78% per annum, payable monthly. The loan is repayable in 84 structured monthly instalments, after a moratorium period of 30 days from the date of invoice of medical equipmentâs. As at March 31, 2018, the balance of the loan '' 923.98 lacs (as at March 31, 2017 '' 1,046.68) is outstanding.

(g) Term loan from RBL Bank Limited is taken in financial year 2016-17 and is secured by first pari-passu charge by way of hypothecation on moveable fixed assets (present & future). Also secured by first charge over interest/dividend/cash flows arising from CCD (Compulsorily Convertible Debentures) issued by Fortis Hospotel Limited to Fortis Healthcare Limited. The rate of interest is 12% per annum (Floating) linked to RBL Bankâs 1Y MCLR, payable monthly. The loan is repayable in 16 equal quarterly installments, after a moratorium period of 12 months from the date of disbursement to the Company. As at March 31, 2018, the balance of the loan '' 9,998.46 (as at March 31, 2017 9,835.82) is outstanding and the bank has invoked its right over current account balance for amount received as interest over Fortis Hospotel Limited.

(h) The loan has been taken from Rattan India Finance Private Limited in the financial year 2017-18. The loan is secured by pledge of 149,822,776 equity shareholding of Fortis Hospotel Limited, pledge of equity 200,260 shares of Escorts Heart Institute and Research Centre Limited, Pledge of equity 3,999,994 shares of Hiranandani Healthcare Private Limited, pledge of 4,439,040 CCDs of Fortis

Hospotel Limited and pledge of entire shareholding of Fortis Malar Hospitals Limited. The rate of interest is 14.00% per annum, payable monthly. The loan is repayable in eight equal quarterly instalment starting from 5th quarter from the date of disbursal. As at March 31, 2018, Rs, 15,339.89 lacs (as at March 31, 2017 Rs, nil lacs) is outstanding. The current average rate of interest is 17.64% p.a.

(a) The short term loan was taken from body corporate as Inter Corporate Deposit in the financial year 2016-17. The rate of interest is 10.25% per annum. The loan is repayable in maximum 181 days from the date of disbursement to the Company i.e. 29th November, 2016 and repaid during the year. As at March 31, 2018, the balance of the loan is Rs, Nil (as at March 31, 2017 Rs, 2,500 lacs).

(b) The short-term loan has been taken from SRL Limited as Inter Corporate Deposit in the financial year 2016-17. The rate of interest is 11.50% per annum, payable quarterly. As at March 31, 2018, the balance of the loan is Rs, 400 lacs (as at March 31, 2017 Rs, 400 lacs).

The Company does not have any commercial papers outstanding as on March 31, 2018.

b. Going concern support in form of funding and operational support letters issued by the Company in favour of FLFL, FCCL, Fortis C-Doc Healthcare Limited, FHMEL, LHPL, FESL, FHIL, FGHML, FHIPL, FAHPL, Birdie and Birdie Realtors Private Limited, FHsL & EHIRCL.

c. For commitment under sponsor agreement entered between the trustee-manager of RHT Health Trust (formerly known as Religare Health Trust), Fortis Global Healthcare Infrastructure Pte. Limited and Hospital Service Companies (Collectively referred as âIndemnified Partiesâ) with the Company, refer note 19.

d. The Company is obligated to provide exit to investors in SRL Limited, subsidiary company through swap of its shares at fair market value under terms of share purchase agreement for Compulsory Convertible Preference Shares issued by the subsidiary company as per shareholder agreement.

e. The Company has other commitments, for purchase/sales order which are issued after considering requirements per operation cycle for purchase/sale of service, employeeâs benefits. The company does not have any long term commitments or material non-cancellable contractual commitments/ contracts, including derivative contracts for which there were any material foreseeable losses.

f. These were no amount which were required to be transferred to be the investor education and protection fund by the company.

g. For commitment under Hospital service and management fees (note 10).

h. Commitment under transition and implementation agreement and definitive agreement approved by the Board of Directors on March 28, 2018. (Refer Note 28)

10) Hospital service and management fees

The company has entered into individual Hospital and Medical Service Agreement (HMSA) with RHT Health Trust (formerly known as Religare Health Trust Group of companies (RHT)) wherein the RHT provides and maintains the clinical establishments along with other service like out-patient diagnostics and radio diagnostic to the Company the term of individual HMSA is 15 year and the Company is required to pay a composite service fee i.e. base and variable fee. The base fee is fixed at the beginning of each year and increase 3% year on year. The variable fee is based on a percentage of companyâs net operating revenue in accordance with the HMSA.

The Company has also provided guarantee to RHT group companies as terms of HMSA. The Bank Guarantees which had been provided by the FHL Entities in favour of the RHT Entities and Fortis Hospotel Limited for the financial year ended 31 March 2018, expired on the 30 April 2018, and are yet to be renewed. Further, FHL has provided an undertaking that one of subsidiary, Fortis Healthcare International Pte Limited (âFHIPLâ), pledges its holdings of 64,120,915 shares in Lanka Hospitals Corporation Plc (âLankaâ), representing 28.66% of the total number of issued shares of Lanka, in favour of the RHT Entities and Fortis Hospotel Limited to secure the payment obligations of the Company under the HMSAs.

Note:

The Company have determined the fair value of the guarantees provided by it to the subsidiary in the current year aggregating to Rs, 691.06 lacs which have been amortized over the period of loan. However, this estimate is subject to change depending on the financial position of the subsidiary companies. Based on the assessment made by the Company the Fair Value of Financial guarantees is 340.58 as at March 31, 2018.

12) Claims assessed as contingent liability and not provided for, unless otherwise stated:

A third party (to whom the ICDs were assigned by a Subsidiary, Fortis Hospitals Limited (âFHsLâ)) (âAssigneeâ or âClaimantâ) has filed a Civil Suit before the District Court, Delhi in February 2018 against various entities including the Company (together âthe defendantsâ) and have, inter alia, claimed implied ownership of brands âFortisâ, âSRLâ and âLa Femmeâ in addition to certain financial claims and for passing a decree that consequent to a Term Sheet dated December 6, 2017 (âTerm Sheetâ) with a certain party, the Company is liable for claims owed by the Claimant to the certain party. In connection with this, the District Court passed an ex-parte order directing that any transaction undertaken by defendants, in favour of any other party, affecting the interest of the Claimant shall be subject to orders passed in the said suit (also refer note 30).

In addition to the above, the Company has also received four notices from the Claimant claiming (i) Rs, 1,800.00 lacs as per notices dated 30 May, 2018 and 1 June, 2018 (ii) Rs, 21,582.00 lacs as per notice dated 4 June 2018; and (iii) Rs, 1,962.00 lacs as per notice dated 4 June 2018. All these notices have been responded to by the Company denying any liability whatsoever.

Separately, certain party has also alleged rights to invest in the Company. It has also alleged failure on part of the Company to abide by the aforementioned Term Sheet and has claimed ownership over the brands as well.

Allegations made by the aforesaid party has been duly responded to by the Company denying (i) execution of any binding agreement with the certain party and (ii) liability of any kind whatsoever. Company has also filed caveats before Honâble High Court of Delhi in this regard.

Based on advice of external legal counsel, the Management believes that the claims are without legal basis and are not tenable and accordingly no adjustment has been made in these Standalone In AS Financial Statements with respect to these claims.

13) Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/ its subsidiaries and Holding company. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan âA. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 options (Grant III) were granted during the year ended March 31, 2010, 1,302,250 options (Grant IV) were granted during the year ended March 31, 2011 and 200,000 options (Grant V) were granted during the year ended March 31, 2012. Under plan âBâ, 4,050,000 options (Grant VI) were granted during the year ended March 31, 2013, 3,715,000 options (Grant VII) were granted during the year ended March 31, 2014, 240,000 option (Grant VIII) were granted during the year March 31, 2015, 100,000 option (Grant IX) during the previous year and 2,500,000 options (Grant X) were granted during the previous year. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company. As at March 31, 2018, the following schemes were in operation:

Stock Options granted

There have been no grants made in the current year by the Company. The weighted average fair value of stock options granted during the year end March 31, 2016, '' 98.90. The Black - Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:

14) Employee Benefits Plan: Defined Contribution Plan

The Companyâs contribution towards its provident fund is a defined contribution retirement plan for qualifying employees. The Companyâs contribution to the Employees Provident Fund is deposited with Provident Fund Commissioner which is recognized by the Income Tax authorities.

The Company recognized Rs,. 796.64 lacs (previous year Rs, 807.37 lacs) for Provident Fund and Employee State Insurance Contribution in the Statement of Profit and Loss account. The Contribution payable to the plan by the Company is at the rate specified in rules to the scheme.

Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn basic salary) for each completed year of service subject. Vesting occurs upon completion of 5 years of service. The Gratuity is unfunded.

The following table summarizes the components of net benefit expenses recognized in the Statement of Profit and Loss and the amounts recognized in the Balance Sheet.

Notes:

a) The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

b) Significant actuarial assumption for the determination of the defined obligation are discounted rate, expected salary escalation rate and withdrawal rate. The sensitivity analyses below have been determined by the actuarial based on reasonably possible changes of the respective assumption occurring at the end of the reporting period, while holding all other assumptions constant.

15) Financial Instruments

i) Capital Management

The Company manages its capital to ensure that the Company will be able to continue as going concerns while maximising the return to stakeholders through the optimisation of the debt and equity balance.

The capital structure of the Company consists of net debt (borrowings as detailed in notes 5(xvi), 5(xvii) and 5(xix) offset by cash and bank balances) and total equity of the company.

The Company is not subject to any externally imposed capital requirements other than for covenants under various loan arrangements of the Company.

The Companyâs Board reviews the capital structure of the Company on need basis. As part of this review, the Board considers the cost of capital and the risks associated with each class of capital. The gearing ratio at March 31, 2018 of 12.70 % (previous year 15.05%) (See below)

*Debt is defined as long-term and short-term borrowings (excluding derivative, financial guarantee contracts and contingent consideration).

(iii) Financial risk management objectives

The Companyâs Corporate Treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks including market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.

The Board of Directors manages the financial risk of the Company through internal risk reports which analyse exposure by magnitude of risk. The Company has limited exposure from the international market as the Companyâs operations are in India. The Company has limited exposure towards foreign currency risk it earns approx. 10% of its revenue from in foreign currency from international patients. Also capital expenditure includes capital goods purchased in foreign currency through the overseas vendors. The Company has not taken any derivative contracts to hedge the exposure. However the exposure towards foreign currency fluctuation is partly hedged naturally on account of receivable from customers and payable to vendors in foreign currency.

Market Risk

The Companyâs activities expose it primarily to the financial risks of changes in interest rates and foreign currency exchange rates.

a) Foreign currency risk management

Foreign currency sensitivity analysis

The company is mainly exposed to the USD & EURO currency.

The following table details the companyâs sensitivity to a 5% increase and decrease in the '' against the USD. 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. The sensitivity analysis includes external loans as well as loans to foreign subsidiaries where the denomination of the loan is in currency other than functional currency of the lender or borrower. A positive number below indicates an increase in profit or equity where the '' strengthens 5% against the relevant currency. For a 5% weakening of the '' against the relevant currency, there would be a comparable impact on the profit or equity, and the balances below would be negative.

b) Interest rate risk management

The Company is exposed to interest rate risk because Company borrow funds at both fixed and floating interest rates. The risk is managed by the Company by maintaining an appropriate mix between fixed and floating rate borrowings.

The Companyâs exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note.

Interest rate sensitivity analysis

The sensitivity analyses below have been determined based on the exposure to interest rates at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in interest rates.

c) Other price risk

The Company investment are in the group companies and are held for strategic purposes rather than for trading purposes.

d) Credit risk management

e) Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the companyâs short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

Liquidity and interest risk tables

The following tables detail the Companyâs remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay.

The contractual maturity is based on the earliest date on which the Company may be required to

p^ay.

16) Fair value measurement Financial Assets measured at Amortized Cost

The carrying amount of financial assets and financial liabilities measured at amortized cost in the financial statements are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amounts would be significantly different from the values that would eventually be received or settled.

17) The Company has entered into âOperation and Managementâ agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

18) Exceptional items

(a) Exceptional item amounting to Rs, 158.53 lacs (Previous year Rs, 373.28 lacs) represents expenses on composite scheme of arrangement and amalgamation. The Board of Directors of the Company at its meeting held on August 19, 2016 approved the proposal to demerge its diagnostic business, including that housed in its majority owned subsidiary SRL Limited (âSRLâ) into another majority owned subsidiary, Fortis Malar Hospitals Limited (âFortis Malarâ) pursuant to a composite scheme of arrangement and amalgamation (âthe Schemeâ). The Scheme also provides for the sale of its hospital business by Fortis Malar to the Company by way of a slump sale. The demerger shall be followed by SRL being merged with Fortis Malar as an integral part of the same Scheme. On transfer of the diagnostic business to Fortis Malar and Fortis Malar issuing its equity shares to the shareholders of the Company, the diagnostic business (including SRL) will be demerged from the Company. The appointed date for the slump sale, demerger and merger under the composite scheme is January 1, 2017. The composite scheme of arrangement and amalgamation is subject to various judicial/regulatory and other required approvals and is therefore not considered as highly probable transaction. Pending such approvals, no effect of the proposed Scheme has been given in the Financial Statements.

Subsequent to year end on dated June 13, 2018, the Board of the Company, SRL and Fortis Malar Hospitals Limited decided to withdraw from the scheme, subject to the approval of National Company Law Tribunal (âNCLTâ). The approval of the NCLT was received on June 15, 2018

(b) Allowance in respect of advance and security deposit given to body corporate along with provision for capital-work-in-progress amounting to Rs, 4,743.47 given to a body corporate for leasing of office premises. Refer note 27 for further details.

(c) During the current year, the Company has provided Rs, 54.73 lacs as doubtful towards amount recoverable from Fortis La Femme Limited due to inability to pay by the subsidiary.

(d) During the current year, impairment loss for goodwill on acquisition of Shalimar Bagh unit amounting to Rs, 570.80 lacs has been recognized.

(e) Exceptional gain of Rs, 735.33 lacs on recovery of salary & other reimbursements paid to erstwhile Executive Chairman in previous year. Further, allowance for Rs, 2,002.39 lacs against amount recoverable for salary & other reimbursement of expenses from the erstwhile Executive Chairman. Refer note 35 for further details.

19) As part of Sponsor Agreement entered between The Trustee-Manager of RHT Health Trust (formerly known as Religare Health Trust), Fortis Global Healthcare Infrastructure Pte. Limited and Hospital Service Companies (collectively referred as âIndemnified partiesâ) with the Company, the Company has provided following indemnities: -

i. To RHT and its directors, officers, employees and agents under the relevant transaction agreements against any losses or liabilities finally determined as payable for any breach of the Consolidated Foreign Direct Investment (FDI) Policy or Foreign Exchange Management Act (âFEMAâ), to the extent that such breach has resulted from the acquisition by RHT of the Hospital Services Companies.

Further, the Company has undertaken to transfer or procure additional medical and healthcare services to Hospital Services Companies in the event that any regulatory authority raises concerns over compliance with any applicable law.

However, the Company will not be liable to indemnify the Indemnified Parties for any losses resulting from delay or failure of the Indemnified Parties in completing any statutory filings or similar formalities under the Consolidated FDI Policy, FEMA and other laws in force in India as of the Listing Date i.e. October 19, 2012, required to be undertaken by the Indemnified Parties in relation to the acquisition by RHT or FGHIPL of the equity shares of the Hospital Services Companies.

The Companyâs obligations under this indemnity shall continue so long as the Company or the Group holds 15.0% or more of the total units from time to time issued in RHT or three years from the Listing Date, whichever is later.

However, the Company will be liable in respect of the indemnity for a maximum period of five years from the Listing Date.

ii. The Company has also undertaken to indemnify (âTax Indemnityâ) each of the Hospital Services Companies and their respective directors, officers, employees and agents (the âInvesting Partiesâ) against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies. Accordingly, Company has till date accrued Rs, 205.03 lacs (as at March 31, 2017 Rs, 205.03 lacs) as provision for contingency.

iii. Further, as per terms of the various Agreements entered into between Hospital Services Companies and Fortis Operating companies, the Hospital Services Companies have right to recover certain statutory dues levied on them from Fortis Operating Companies. There is a possible present obligation on Hospital Services Companies to collect certain statutory dues from the Fortis Operating Companies and pay it to the relevant authorities. In view of uncertainty arising from interpretation of the regulations, management believes that value of such statutory dues cannot be measured reliably and therefore has not been considered in these financial statements.

20) During the year ended 31 March, 2012, the Company entered into Share Purchase Agreement with Fortis Health Management Limited (FHML), subsidiary of RHT Health Trust on January, 9 2012, pursuant to which FHML acquired 49% interest held by the Company in Fortis Hospotel Limited (FHTL) at an aggregate consideration of Rs, 37,728.39 lacs. FHTL is the owner of Clinical Establishment at Shalimar Bagh and Gurgaon.

Escorts Heart Institute and Research Centre Limited (âEHIRCLâ) also issued 401,769 Compulsorily Convertible Preference Shares (âCCPSâ) of face value of '' 10 each at a premium of Rs, 7,456.98 per CCPS to Kanishka Healthcare Limited (âKHLâ) with a maturity period of 15 years aggregating to Rs, 30,000 lacs (CCPS subscription amount) on September 16, 2027. The holder of the CCPS is entitled to receive, only out of legal funds available for the repayment of dividends, dividends in respect of the par value of the invested CCPS at a per annum rate of 0.01%. Subsequently, KHL merged with International Hospitals Limited (âIHLâ), subsidiary of RHT Health Trust.

Further, FHML on September 17, 2012 entered into Shareholdersâ Agreement with the Company, pursuant to which FHML had a call option over the Companyâs 51% interest in FHTL (âFHTL Call Optionâ) at a determined call option price of Rs, 30,000 lacs, subject to applicable laws including fulfillment of certain conditions and receipt of necessary approvals from all third parties. Per Shareholdersâ Agreement, FHML also had the right to appoint 50% of the directors of FHTL, including the Chairman of the Board of Directors who had the casting vote in case of deadlock on any matter, on all financial and operating policies of the FHTL, brought to the Board of Directors for its approval. Additionally, the Company had assigned its right to receive dividends from FHTL in favour of FHML. The Management thereafter concluded that it does not exercises any control to direct relevant activities of FHTL and does not have any economic interest therefore, deconsolidated FHTL from the Group.

FHML also had a put option on its 49% interest in FHTL (âFHTL Put Optionâ), exercisable if FHML was unable to acquire 100% of the issued and paid-up share capital of FHTL within 5 years from the date of transfer of the 49% shareholding of FHTL by the Company to FHML, for any reason outside the control of FHML. The put option could have been exercised at a price that is equal to the fair market value of Put Securities on the date of exercise of put option, determined on a discounted cash flow basis.

Key terms of CCPS agreement are:-

a) CCPS Put Option - IHL is entitled to exercise an unconditional and irrevocable right to require the Company or its nominee to buy all of CCPS held by IHL in EHIRCL upon occurrence of IHL having exercised FHTL Put Option or FHTL Call Option under shareholders agreement entered between the Company, FHTL and FHML. The considerations payable by the Company to IHL is as follows :-

- In case of FHTL call option - the Company is required to pay call option price determined at Rs, 30,000 Lacs, subject to compliance with the applicable law.

- In case of FHTL put option - the Company is required to purchase, subject to due compliance with law, all CCPS at consideration equal to IHLâs contribution along with coupon rate agreed.

b) CCPS Call Option - If IHL becomes entitled to exercise the CCPS Put Option, but does not exercise the CCPS Put Option within 90 business days thereof, then the Company shall at any time after the expiry of such 90 business days, be entitled to require IHL to sell all of the CCPS to the Company for a consideration equal to the CCPS Subscription amount along with the coupon of 0.01% accrued thereon as of such date.

In accordance with Ind AS 109, the Companyâs 51% interest in FHTL has been recognized at Rs, 30,000 lacs as receivable from associate company, in the opening Balance Sheet prepared as on April 01, 2015 under Ind AS, being the amount committed to be provided to the Company on transfer of legal right in FHTL on receipt of regulatory approval, which as per Management was more likely to receive being prefunctionary in nature. The amount was earlier recognized at Rs, 20,739.71 lacs (at derived cost) under the previous GAAP.

Further, the Company in its standalone books of account recognized at derivative asset of Rs, 1,908.90 lacs in the opening Balance Sheet prepared under Ind AS as at April 01, 2015 and derivative gain of Rs, 3,727.10 lacs in the Statement of Profit and Loss under Ind AS for the year ended March 31, 2016, being fair value uplift in the value of EHIRCL CCPS, in excess of call option price of Rs, 30,000 Lacs.

During the previous year ended 31 March, 2017, the Company completed the acquisition of 51% economic interest in FHTL by way of acquiring 51% of the compulsorily convertible debentures (CCDs) from Fortis Global Healthcare Infrastructure Pte Ltd (FGHIPL)-a subsidiary of RHT Health Trust (RHT) for an aggregate consideration ofRs, 110,093 lacs on 13 October, 2016. As per the Amended and Restated Shareholders Agreement (âSHAâ) signed between FHML, effective on completion of acquisition of CCDs, the Company has the right to appoint majority of the non-independent directors of FHTL, including the Chairman of the Board of Directors of FHTL who has casting vote in case of deadlock in relation to any matter at a meeting of the Board of Directors. The Management has concluded that it has obtained control over FHTL, as it now has control to direct relevant activities and therefore consolidated FHTL in the Group w.e.f. 13 October 2016.

Fortis Hospitals Limited, subsidiary of FHL, acquired EHIRCL CCPS from IHL for an aggregate consideration of Rs, 35,669 lacs on October 13, 2016.

Further, other terms of the Share Purchase Agreement in relation to Call and Put Option were deleted and the Company therefore reversed the derivative asset of Rs, 5,636 Lacs recorded in standalone books of account in the previous year ended 31 March, 2017.

The carrying value of the receivable on transfer of legal right has been considered as cost of investment in the FHTL, now a subsidiary of the Group. Additional investment made in CCDs carry an interest rate of 17.5% per annum and mandatorily convertible into equity shares on September 16, 2027 and therefore the Company has segregated the total value paid towards debt component and equity component, based on fair value measurement principles as per Ind AS.

21) During the year ended March 31, 2014, the Company issued 150 Foreign Currency Convertible Bonds aggregating to US Dollar 300 lacs due 2018 (the âBondsâ) at the rate of (4.66% LIBOR). These Bonds were listed on the Singapore Exchange Securities Trading Limited (the âSGX-STâ).

The Bonds were convertible upto US Dollar 240 lacs of principal amount at the option of the holder at any time on or after September 17, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to August 01, 2018 into fully paid equity shares with full voting rights at par value of Rs, 10 each of the Company (âSharesâ) at an initial Conversion Price (as defined in the âTerms & Conditions of the Bondsâ) of Rs, 99.09 with 120,471 shares being issued per Bond with a fixed rate of exchange on conversion of Rs, 59.6875 = US Dollar 1.00. The Conversion Price was subject to adjustment in certain circumstances.

Subject to certain conditions, the Bonds could be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond outstanding (but in no event exceeding US Dollar 60 lacs in aggregate principal amount of Bonds), at the option of the Company at any time on or after September 17, 2013 up to August 01, 2018 at the Partial Reset Conversion Price (as defined in the âTerms & Conditions of the Bondsâ).

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Unless previously redeemed, converted or purchased and cancelled, the Bonds would be redeemed by the Company in US Dollars on August 08, 2018 at 100 per cent of its principal amount. These Bonds were considered a monetary liability and are redeemable only if there is no conversion before maturity date.

The proceeds of the issue amounting to Rs, 18,390.74 lacs were used for repayment of debts.

During the previous year, the Company allotted 18,070,650 equity shares to Standard Chartered (Mauritius) III Limited against USD 30 Million FCCB, on exercise of conversion option as per Offering Circular.

The fair value of the liability portion of such optional convertible bonds is determined using a market interest rate for an equivalent non-convertible bonds. This amount is recorded as liability on an amortized cost basis until extinguished on conversion or redemption of the bonds. The remainder of the proceeds received on issuance of FCCB is considered to be attributable to the equity portion of the compound instruments. This is recognized and included in the shareholdersâ equity, and not subsequently remeasured and on conversion of FCCB into equity shares the amount is transferred to retained earnings in the year of conversion.

The effective interest rate on the liability element on initial recognition, pursuant to such segregation was 6.03 % per annum.

22) During the year ended March 31, 2014, the Company issued 550 Foreign Currency Convertible Bonds of US Dollar 1 lac each aggregating to US Dollar 550 lacs due 2018 (the âBondsâ) at the rate of LIBOR 4.86%. The Bonds were convertible at the option of International Finance Corporation (âIFCâ), an international organization established by Articles of Agreement among its member countries including the Republic of India (the holder) giving 7 day notice to the Company at any time on or after June 07, 2013 up to June 08, 2018 into fully paid equity shares with full voting rights at par value of '' 10 each of the Company (âSharesâ) at an initial Conversion Price (as defined in the âTerms & Conditions of the Bondsâ) of '' 99.09 and number of shares to be issued would be calculated on conversion on the basis of applicable rate of exchange of US Dollar and '' on conversion date. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds could be converted on the request of the holder but not less than value of US Dollar 5,000,000 or in multiple of US Dollar 1,000,000 thereafter. Except in certain condition mentioned in the âTerms & Conditions of the Bondsâ the holder could not exercise the Conversion Option in part or in full in respect of twenty per cent (20%) of the original bond value for a period of three (3) years after the Subscription Date.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond at the option of the Company at any time on or after June 07, 2013 at Modified Conversion Price (as defined in the âTerms & Conditions of the Bondsâ).

Unless previously redeemed, converted or purchased and cancelled, the Bonds would be redeemed by the Company in US Dollars on June 08, 2018 at 100 per cent of its principal amount. These Bonds were considered a monetary liability and redeemable only if there is no conversion before maturity date.

During the previous year, the Company allotted 35,690,887 equity shares to International Finance Corporation against USD 55 Million FCCB, on exercise of conversion option as per FCCB Subscription Agreement.

The effective interest rate on the liability element on initial recognition, pursuant to such segregation is 5.28 % per annum.

The above information regarding dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information available with the Company. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements. This has been relied upon by the auditors.

The loan to subsidiary company (âFHsLâ) was given initially during the financial year 2011-12 and has been extended during the previous years through various addendums. The loan carried interest at 11.50% to 13.75% p.a. during its term. Currently, the interest rate is 11.50% p.a. and the loan is repayable after 31 March, 2019 as per the addendum entered during the year. Interest accrued of Rs, 9,996.13 lacs as at 31 March, 2017 has been converted into loan during the year.

25) During the year, the Company has capitalized the following expenses to the cost of Property, Plant and equipmentâs/ capital work in progress (CWIP). Consequently, expenses disclosed under the respective notes are net of amount capitalized by the Company.

27) Recoverability of certain advances / capital work-in-progress.

(Also refer to Note 30 [d][ix] of the Standalone Ind AS Financial Statements)

The Company had paid amount towards advance and security deposit amounting to '' 2,173.57 lacs to a body corporate towards lease of office space in the financial year 2013-14. Due to delays in obtaining occupancy certificate (OC), the lease agreement was terminated by the Company. Additionally, amounts aggregating to Rs, 2,569.90 lacs was incurred towards capital work-in-progress on the premises proposed to be taken on lease from the Lessor, which amount is also being claimed from the Lessor pursuant to the aforesaid termination. The Company has invoked arbitration against the Lessor and issued a Legal Notice under Section 21 of the Arbitration and Conciliation Act 1996.

In view of the facts stated above and the uncertainty in the ultimate recovery of the aforesaid balances, the Company has recorded provisions aggregating to Rs, 4,743.47 lacs in the Standalone Ind AS Financial Statements.

28) The Board of Directors in their meeting held on November 14, 2017 approved a significant restructuring initiative aimed at consolidating the entire India asset portfolio of RHT Health Trust (âRHTâ) into the Company and its subsidiaries. The Company and the Trustee Manager of RHT signed a binding Term Sheet on November 14, 2017 and entered into an exclusivity arrangement for the acquisition of all the securities of RHTâs entities in India, directly or indirectly holding the clinical establishments and businesses for an enterprise value of approximately Rs, 465,000 lacs (âthe Proposed Transactionâ). The exclusivity period to execute definitive agreements for the Proposed Transaction was 60 days commencing from the date of the Term Sheet. On January 12, 2018, the parties to the Term Sheet mutually agreed to extend the exclusivity period by an additional period of 31 days from January 12, 2018.

On February 12, 2018, parties to the Term Sheet entered into definitive agreement(s) with respect to the Proposed Transaction. The completion of the Proposed Transaction is subject to the satisfaction of conditions precedent enumerated in the definitive agreement(s) which includes regulatory approvals and any other approvals as may be required. The Company and RHT are in process of applying for regulatory approvals. Requisite approval of the shareholders of the Company have been obtained.

29) Changes in the constitution of the Board of Directors of the Company

During the year ended March 31, 2018 and until the date of issuance of these financial result, the following changes have occurred in the constitution of the Board of Directors of the Company:

a) In November 2017, Ms. Shradha Suri Marwah, resigned as a non-executive independent director of the Company;

b) On February 8, 2018, Mr. Malvinder Mohan Singh, Executive Chairman and Dr. Shivinder Mohan Singh, Non-Executive Vice Chairman tendered their resignation from the directorship of the Company, effective immediately. The erstwhile Board of Directors of the Company discussed the matter in detail at their meeting held on February 13, 2018 and accepted the resignations with effect from February 8, 2018.

c) During March 2018, Ms. Joji Sekhon Gill, Dr. Preetinder Singh Joshi and Mr. Pradeep Ratilal Raniga resigned from their directorships in the Company.

d) Mr. Rohit Bhasin was appointed as an additional independent director in the Company in April 2018. He subsequently resigned on June 26, 2018.

e) In April 2018, Ms. Suvalaxmi Chakraborty, Mr. Ravi Rajagopal and Mr. Indrajit Banerjee were appointed as Non-Executive Independent Directors of the Company and their appointment was ratified by the members of the Company in the extra-ordinary general meeting (âEGMâ) of the Company in May 2018.

f) During May 2018, Mr. Harpal Singh, Director, Lt. Gen. Tejinder Singh Shergill and Ms. Sabina Vaisoha, Additional Directors in the Company resigned from their directorships in the Company and Dr. Brian Tempest, Independent Director and Chairman of the Audit and Risk Management Committee, disassociated from his position at the behest of the resolution of the members in the EGM held in May 2018.

g) Further, Mr. Ravi Rajagopal has been appointed as Chairman of the Board with effect from June 1, 2018. As such, the re-constituted Board of Directors comprises the following directors who were all appointed in April 2018 after the financial year ended March 31, 2018:

i. Mr. Ravi Rajagopal - Chairman & Independent Director

ii. Mr. Indrajit Banerjee - Independent Director

iii. Ms. Suvalaxmi Chakraborty - Independent Director

iv. Mr. Rohit Bhasin - Independent Director (Additional Director) (Resigned w.e.f June 26, 2018) together referred to as the âRe-constituted Boardâ.

30) Investigation initiated by the erstwhile Audit and Risk Management Committee

(a) There were reports in the media and enquiries from, inter alia, the stock exchanges received by the Company about certain inter-corporate loans (âICDsâ) given by a wholly owned subsidiary of the Company. The erstwhile Audit and Risk Management Committee of the Company in its meeting on February 13, 2018 decided to carry out an independent investigation through an external legal firm.

(b) The terms of reference of the investigation, inter alia, comprised: (i) ICDs amounting to a total of Rs, 49,414.00 lacs (principal), placed by the Companyâs wholly-owned subsidiary, FHsL, with three borrowing companies as on July 1, 2017; (ii) the assignment of these ICDs to a third party and the subsequent cancellation thereof as well as evaluation of legal notice (now a civil suit) received from such third party (refer Notes 12 above); (iii) review of intra-group transactions for the period commencing FY 2014-15 and ending on December 31, 2017 (refer Note 27 above); (iv) investments made in certain overseas funds by the overseas subsidiaries of the Company (i.e. Fortis Asia Healthcare Pte. Ltd, Singapore and Fortis Global Healthcare (Mauritius) Limited); (v) certain other transactions involving acquisition of Fortis Healthstaff Limited (âFortis Healthstaff â) from a promoter group company, and subsequent repayment of loan by said subsidiary to the promoter group company.

(d) The re-constituted Board discussed and considered the Investigation Report and noted certain significant findings of the external legal firm, which are subject to the limitations on the information available to the external legal firm and their qualifications and disclaimers as described in their investigation report, as follows:

i. The Investigation Report, on the basis of documents / emails reviewed and interviews conducted, revealed that the ICDs were not given under the normal treasury operations of the Company/ FHsL including under the treasury policy and the mandate of the Treasury Committee; and were not specifically authorized by the Board of FHsL. All ICDs from December 2011 were repaid until March 31, 2016. However, from the first quarter of the financial year 2016-17, it has been observed that a roll-over mechanism was devised whereby, the ICDs were repaid by cheque by the borrower companies at the end of each quarter and fresh ICDs were released at the start of succeeding quarter under separately executed ICD agreements. Further, in respect of the roll-overs of ICDs placed on July

1, 2017 with the borrower companies, FHsL utilized the funds received from the Company for the purposes of effecting roll-over.

ii. In respect of ICDs granted, the Investigation Report revealed that there were certain systemic lapses and override of controls including shortcomings in executing documents and creating a security charge. To clarify, the charge was later created in February, 2018 for the ICDs granted on July 1, 2017, while the Company/ FHsL was under financial stress.

iii. While the Investigation Report did not conclude on utilization of funds by the borrower companies, there are findings in the report to suggest that the ICDs were utilized by the borrower companies for

granting/ repayment of loans to certain additional entities including those whose current and/ or past promoters/ directors are known to/ connected with the promoters of the Company.

iv. In terms of the relationship with the borrower companies, there was no direct relationship between the borrower companies and the Company and / or its subsidiaries during the period December 2011 till December 14, 2017 (these borrower companies became related parties from December 15, 2017). The Investigation Report has made observations where promoters were evaluating certain transactions concerning certain assets owned by them for the settlement of ICDs thereby indirectly implying some sort of affiliation with the borrower companies. The Investigation Report has observed that the borrower companies could possibly qualify as related parties of the Company and/ or FHsL, given the substance of the relationship. In this regard, reference was made to Indian accounting Standards dealing with related party disclosures, which states that for considering each possible related party relationship, attention is to be directed to the substance of the relationship and not merely the legal form.

v. Objections on record indicate that management personnel and other persons involved were forced into undertaking the ICD transactions under the repeated assurance of due repayment and it could not be said that the management was in collusion with the promoters to give ICDs to the borrower companies. Relevant documents/information and interviews also indicate that the managementâs objections were overruled. However, the former Executive Chairman of the Company, in his written responses, has denied any wrongdoing, including override of controls in connection with grant of the ICDs.

vi. There were certain systemic lapses in respect to the assignment of the ICDs from FHsL to a third party in September 2017 (and subsequent termination of the arrangement in January 2018), viz., no diligence was undertaken in relation to the assignment, it was not approved by the Treasury Committee and was antedated. The Board of FHsL took note of the same only in February 2018.

vii. Separately, it was also noted in the Investigation Report that the aforesaid third party to whom the ICDs were assigned has also initiated legal action against the Company. Whilst the matter was included as part of the terms of reference of the investigation, the merits of the case cannot be reported since the matter was sub-judice.

viii. During the year, the Company through its subsidiary (i.e. Escorts Heart Institute and Research Centre Limited (âEHIRCLâ)), acquired 71% equity interest in Fortis Healthstaff Limited at an aggregate consideration of Rs, 3.46 lacs. Subsequently, EHIRCL advanced a loan to Fortis Healthstaff Limited, which was used to repay the outstanding unsecured loan amount of Rs, 794.50 lacs to a promoter group company. Certain documents suggest that the loan repayment by Fortis Healthstaff Limited and some other payments to the promoter group company may have been ultimately routed through various intermediary companies and used for repayment of the ICDs /vendor advance to FHsL / Company.

ix. The investigation did not cover all related party transactions during the period under investigation and focused on identifying undisclosed parties having direct/indirect relationship with the promoter group, if any. In this regard, it was observed in internal correspondence within the Company that transactions with certain other entities have been referred to as related party transactions. However, no further conclusions have been made in this regard.

x. Additionally, it was observed in the Investigation Report that there were significant fluctuations in the NAV of the investments in overseas funds by the overseas subsidiaries during a short span of

time. Further, similar to the paragraph above, in the internal correspondence within the Company, investments in the overseas funds have been referred to as related party transactions. The investment was realized in April 2018 with no loss in the principal value of investments.

(e) Other Matters:

In the backdrop of the investigation, the Management has reviewed some of the past information/ documents in connection with transactions undertaken by the Company and certain subsidiaries. It has been noted that the Company through its subsidiary (i.e. Fortis Hospitals Limited (âFHsLâ)) acquired equity interest in Fortis Emergency Services Limited from a promoter group company. On the day of the share purchase transaction, FHsL advanced a loan to Fortis Emergency Services Limited, which was used to repay an outstanding unsecured loan amount to the said promoter group company. It may be possible that the loan repayment by Fortis Emergency Services Limited to the said promoter group company was ultimately routed through various intermediary companies and was used for repayment of the ICDs /vendor advance to FHsL.

(f) Related party relationships as required under Ind AS 24 - Related Party Disclosures and the Companies Act, 2013 are as identified by the Management taking into account the findings and limitations in the Investigation Report (Refer Notes 30 (d) (iv), (ix) and (x) above) and the information available with the Management. In this regard, in the absence of specific declarations from the erstwhile directors on their compliance with disclosures of related parties, especially considering the substance of the relationship rather than the legal form, the related parties have been identified based on the declarations by the erstwhile directors and the information available through the known shareholding pattern in the entities. Therefore, there may be additional related parties whose relationship may not have been disclosed to the Group and, hence, not known to the Management.

(g) As per the assessment of the Board, based on the investigation carried out through the external legal firm, and the information available at this stage, all identified/required adjustments/disclosures arising from the findings in the Investigation Report, have been made in these Consolidated Ind AS Financial Statements.

(h) With respect to the other matters identified in the Investigation Report, the Board will appoint an external agency of repute to undertake a scrutiny of the internal controls and compliance framework in order to strengthen processes and build a robust governance framework. Towards this end, they will also evaluate internal organizational structure and reporting lines, the delegation of powers of the Board or any committee thereof, the roles of authorized representatives and terms of reference of executive committees and their functional role. We will also assess the additional requisite steps to be taken in relation to the significant matters identified in the Investigation Report, including inter alia, initiating an internal enquiry.

(i) The regulatory authorities are currently undertaking their own investigation (refer Note 31 below), and i

Mar 31, 2017

1) Related party disclosures

Names of related parties and related party relationship

Ultimate Holding RHC Holding Private Limited (Holding Company of Fortis Healthcare Holdings

Company Private Limited)

Holding Company Fortis Healthcare Holdings Private Limited (âFHHPLâ)

Subsidiary Companies 1 Fortis Hospotel Limited (''FHTL'') (refer note xxx) (w.e.f. October 13, 2016)

- ^{direct or indirect} 2 Hiranandani Healthcare Private Limited (''HHPL'')

through investment in

_sub_sidi_ari_es 3 Fortis La Femme Limited (''FLFL'') (formerly known as Fortis Health

Management (West) Limited)

4 Fortis Emergency Services Limited (''FESL'')

5 Fortis Health Management (East) Limited (''FHMEL'')

6 SRL Limited (''SRL'')

7 SRL Diagnostics Private Limited (''SRLDPL'')

8 Fortis Healthcare International Limited (''FHIL'')

9 Fortis Global Healthcare (Mauritius) Limited (''FGHML'')

10 Fortis Hospitals Limited (''FHsL'')

11 Fortis Cancer Care Limited (''FCCL'') (formerly known as Fortis Health Management (South) Limited)

12 Lalitha Healthcare Private Limited (''LHPL'')

13 Fortis Malar Hospitals Limited (''FMHL'')

14 Malar Stars Medicare Limited (''MSML'')

15 Escorts Heart Institute And Research Centre Limited (''EHIRCL'')

16 Fortis Healthstaff Limited (''FHSL'')

17 Fortis Asia Healthcare Pte Limited (''FAHPL'')

18 Fortis Healthcare International Pte Limited (''FHIPL'')

19 Fortis Healthcare Singapore Pte Limited (''FHSPL'') (upto April 7, 2015)

20 Radlink Asia Pte Limited (Radlink) (''RADLINK'') (upto May 12, 2015)

21 Radlink Medicare Pte Limited (''RMPL'') (upto May 12, 2015)

22 DRS Thompson & Thomson (Radlink Medicare) Pte Limited (upto May 12,

2015)

23 Radlink Medicare (Bishan) Pte Limited (upto May 12, 2015)

24 Radlink Medicare (Woodlands) Pte Limited (upto May 12, 2015)

25 Radlink Medicare (Tampines) Pte Limited (upto May 12, 2015)

26 Radlink Medicare (Jurong East) Pte Limited (upto May 12, 2015)

27 Clinic 1866 Pte Limited (upto May 12, 2015)

28 Radlink Diagnostic Imaging (S) Pte Limited (''RDISPL'') (upto May 12, 2015)

29 Drs Lim Hoe & Wong Radiology Pte Limited (upto May 12, 2015)

30 Healthcare Diagnostic Services Pte Limited (upto May 12, 2015)

31 Radlink Women & Fetal Imaging Centre Pte Limited (upto May 12, 2015)

32 Radlink Pet & Cardiac Imaging Centre Pte Limited (''RADLINK PET'') (upto May

12, 2015)

33 Singapore Radiopharmaceuticals Pte Limited (upto May 12, 2015)

34 Singapore Molecular Therapy Centre Pte Limited (upto May 12, 2015)

35 Mena Healthcare Investment Company Limited (''MHICL'')

36 SRL Diagnostics FZ-LLC

37 Medical Management Company Limited

38 Fortis Healthcare Middle East LLC

39 Healthcare Clinic and Surgery Pte. Limited

40 Birdie & Birdie Realtors Private Limited

41 Fortis CSR Foundation

42 Stellant Capital Advisory Services Private Limited (w.e.f. November 3, 2015)

43 RHT Health Trust Trustee Manager Pte. Limited (formerly known as Religare Health Trust Trustee Manager Pte. Limited) (w.e.f.February 2, 2015)

Companies (4), (5), (11), (13) and (43) of above are subsidiaries of FHsL; Company (7) of above is subsidiary of SRL; Company (9) of above is a subsidiary of FHIL; Companies

(12) of above is subsidiary of FCCL; Company (14) of above is a subsidiary of FMHL; Companies (16) and (17) of above are subsidiaries of EHIRCL; Company (18) of above is subsidiary of FAHPL; Company (18), (19), (35), (36), and (38) of above are subsidiaries of FHIPL; Company (20) of above is subsidiary of FHSPL; Companies (21) and (28) of above are subsidiaries of RADLINK; Companies (22) to (27) of above are subsidiaries of RMPL; Companies (29) to (32) of above are subsidiaries of RDISPL; Companies (33) and (34) of above are subsidiaries of RADLINK PET; Company (37) of above is subsidiary of MHICL; Company (43) of above is a subsidiary of Company (42) of above.

Fellow Subsidiaries (a) RWL Healthworld Limited (formerly known as Religare Wellness Limited)

(with whom transactions have been ^{(b) Escorts heart Centre Limited} taken place) (c) Medsource Healthcare Private Limited

Associates (with whom (a) Sunrise Medicare Private Limited

^{have been} (b) Medical and Surgical Centre Limited, Mauritius (Associate of Fortis Healthcare ^{taken place)} International Limited)

(d) Escorts Heart and Super Speciality Institute Limited (''EHSSIL'')

(e) Escorts Heart and Super Speciality Hospital Limited (''EHSSHL'')

(f) Fortis Health Management Limited (''FHML'')

(g) Fortis Medicare International Limited (''FMIL'')

(h) Hospitalia Eastern Private Limited (''HEPL'')

Joint Ventures (a) Super Religare Reference Laboratories (Nepal) Private Limited (Joint venture of

SRL)

(b) DDRC SRL Diagnostics Services Private Limited (Joint venture of SRLDPL)

(d) Fortis C-Doc Healthcare Limited (''C-Doc'')

Key Management (a) Mr. Malvinder Mohan Singh - Executive Chairman Personnel (âKMPâ)

(b) Mr. Shivinder Mohan Singh - Non-Executive Vice Chairman (w.e.f January 1, 2016) Additional related parties as per the Companies Act, 2013

(d) Mr. Gagandeep Singh Bedi - Chief Financial Officer

(e) Mr. Rahul Ranjan - Company Secretary

(f) Mrs. Ritu Vij - Relative of KMP

(g) Dr. Brian William Tempest - Non-Executive Independent Director

(h) Mr. Gurcharan Das - Non-Executive Director

(i) Mr. Harpal Singh - Non-Executive Director

(j) Ms. Joji Sekhon Gill - Non-Executive Independent Director

(k) Ms. Lynette Joy Hepburn Brown - Non-Executive Independent Director

(l) Mr. Pradeep Ratilal Raniga - Non-Executive Independent Director

(m) Dr. Preetinder Singh Joshi - Non-Executive Independent Director

(n) Mr. Ravi Umesh Mehrotra - Non-Executive Director

(o) Ms. Shradha Suri Marwah - Non-Executive Independent Director

(p) Mr. Sunil Godhwani - Non-Executive Director

(q) Mr. Udai Dhawan - Non-Executive Independent Director

Enterprises owned or (a) Fortis Nursing and Education Society

bⁱ^ke^fiy^crri;iinag^nfli_e^erit^ced (b) Ligare Travel Limited (formerly known as Religare Travels (India) Limited)

p^{ersonnel (}''^KMP''^{) or} (c) Ligare Aviation Limited (formerly known as Religare Aviation Limited) their relatives (with 1,11 ,

_wh_om t_ransacti_ons (d) Dion Global Solutions Limited

^{have been taken} p^lace) (e) Healthfore Technologies Limited

Related Parties have been identified by the management.

Notes:

*The loans availed by above companies against guarantee given have been used by the respective companies for acquiring fixed assets and meeting working capital requirements.

The above outstanding are unsecured and will be settled in cash. No expenses has been recognized in the current or prior years for bad or doubtful debt in respect of the amounts owned by related party.

2) Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises, few medical equipmentâs and other premises are obtained on operating lease. The total lease payments in respect of such leases recognized in the statement of profit and loss for the year are Rs, 999.82 lacs (FY 2015-16 Rs, 1,791.49 lacs & FY 2014-15 Rs, 2,262.21 lacs) out of which amount of rent capitalized during the year are Nil (FY 2015-16 Rs, 1,225.21 lacs & FY 2014-15 Rs, 1,212.24 lacs).

(a) The loan has been taken from HDFC Bank Limited in the financial year 2015-16. The loan is secured by a first pari passu charge by way of hypothecation of the Companyâs movable fixed assets. The rate of interest is HDFC Bank Base Rate of the bank plus 0.85% per annum, payable monthly. The loan is repayable in 52 structured monthly installments commencing from October 1, 2015. As at March 31, 2017, Rs, 5,323.42 lacs (as at March 31, 2016 Rs, 6,872.50 lacs and as at April 01, 2015 Nil) is outstanding. The current effective average rate of interest is 9.85% p.a.

(b) Term loan from Yes Bank has been taken in financial year 2016-17 for purchase of various medical equipmentâs and is secured by hypothecation on invoices and insurance copies of that medical equipmentâs. The rate of interest is 0.50% per annum over and above yearly MCLR, payable monthly. The loan is repayable in 26 structured quarterly installments, after a moratorium period of 180days from the date of disbursement to the Company. As at March 31, 2017, Rs, 1,621.15 lacs (as at March 31, 2016 Nil & as at April 01, 2015 Nil) is outstanding. The current effective average rate of interest is 9.45% p.a.

(c) The short term loan has been taken from Standard Chartered Investments & Loans (India) Limited in the financial year 2016-17 for the purpose of working capital and is secured by share pledge of the FHL 51% shareholding in Fortis Hospitals Limited and personal guarantee of Mr. Malvinder Mohan Singh. Standard Chartered Investments & Loans (India) Limited has the right to revise the specified rate at its discretion on the interest reset dates. The loan was repayable in maximum nine months from the date of disbursement to the Company. As at March 31, 2017, the balance of the loan Rs, 10,000 lacs (as at March 31, 2016 Nil & as at April 01, 2015 Nil) is outstanding. The current effective average rate of interest is 11.50% p.a.

(d) The overdraft facility has been availed from Standard Chartered Bank. Overdraft limit of Rs, 4,000 lacs and is secured by pari passu charge over moveable fixed assets at Mohali hospital and current assets of the Company. The rate of interest is Base rate plus margin, as may be agreed from time to time. The current effective average rate of interest is 11.25% p.a.

(e) The short term loan has been taken from Standard Chartered Bank in the financial year 2016-17 for the purpose of working capital. The loan is secured it is also secured by pari passu charge over moveable fixed assets at Mohali hospital ,current assets of the Companyand personal guarantee of Mr. Malvinder Mohan Singh. The rate of interest is MCLR plus applicable margin, as may be agreed from time to time. The loan is repayable in maximum four months from the date of disbursement to the company. As at March 31, 2017, the balance of the loan Rs, 2,500 lacs (as at March 31, 2016 Nil &as at April 01, 2015 Nil) is outstanding. The current effective average rate of interest is 11.50% p.a.

(f) Term loan from Siemens Financial Services Private Limited has been taken in financial year 2016-17 for purchase of medical equipmentâs and is secured by exclusive charge by way of hypothecation of that medical equipmentâs, along with all standard accessories. The rate of interest is 7.78% per annum, payable monthly. The loan is repayable in 84 structured monthly installments, after a moratorium period of 30 days from the date of invoice of medical equipmentRs,s. As at March 31, 2017, the balance of the loan Rs, 1,046.68 lacs (as at March 31, 2016 Nil & as at March 31, 2015 Nil) is outstanding.

(g) Term loan from RBL Bank LimitedRs,s taken in financial year 2016-17 and is secured by first pari-passu charge by way of hypothecation on moveable fixed assets (present & future). Also secured by first charge over interest/dividend/cash flows arising from CCD (Compulsorily Convertible Debentures).The rate of interest is 10% per annum (Floating) linked to RBL Bankâs 1Y MCLR, payable monthly. The loan is repayable in 16 equal quarterly installments, after a moratorium period of 12 months from the date of disbursement to the Company. As at March 31, 2017, the balance of the loan '' 9,835.82 (as at March 31, 2016 Nil& as at March 31, 2015 Nil) is outstanding.

(h) Term loan from L&T Infrastructure Finance Company Limited (âLenderâ) was taken in financial year 2011-2012 and was secured by a first pari passu charge by way of mortgage of the Companyâs immovable properties, present and future. Further secured by a first pari passu charge by way of hypothecation of the Companyâs movable assets, including movable machinery, machinery spares, tools and accessories, present and future. Also, secured by a second pari passu charge by way of hypothecation on the Companyâs book debts, operating cash flows and the receivables and revenues, current assets commissions and revenues of whatsoever nature and wherever arising, both present and future. Further, there was an exclusive pledge of shareholding of the Company in SRL Limited in favour of the lender, to the extent of at least 2 times of the facility amount, to be maintained at all time during the subsistence of the facility. The rate of interest for each tranche of facility was Prime Lending rate less 3.75% per annum, payable monthly. On July 31, 2013, Lender had assigned Rs, 10,000 lacs to L&T Fincorp Limited out of outstanding amount of Rs, 16,683.33 lacs as on that date. The loan was repayable in 84 structured monthly installments, after a moratorium of 12 months from the date of first disbursement to the Company. As at March 31, 2017, the balance of the loan is Nil (as at March 31, 2016 Nil; as at March 01, 2015, Rs, 8,065.40 lacs) as it was fully repaid to L&T Fincorp Limited during the financial year 2015-16.

(a) The short term loan has been taken from body corporate as Inter Corporate Deposit in the financial year 2016-17. The rate of interest is 10.25% per annum. The loan is repayable in maximum 181 days from the date of disbursement to the company i.e. 29th November, 2016. As at March 31, 2017, the balance of the loan is Rs, 2,500 lacs (as at March 31, 2016 Nil & as at March 31, 2015 Nil) is outstanding.

(b) The short term loan has been taken from related party as Inter Corporate Deposit in the financial year 2016-17. The rate of interest is 11.50% per annum, payable quarterly. The loan is repayable on 30th September, 2017. As at March 31, 2017, the balance of the loan is Rs, 2,500 lacs (as at March 31, 2016 Nil

& as at March 31, 2015 Nil) is outstanding.

b. Going concern support in form of funding and operational support letters issued by the Company in favour of FLFL, FCCL, Fortis C-Doc Healthcare Limited, FHMEL, LHPL, FESL, FHIL, FGHML,FHIPL, FAHPL, and Birdie and Birdie Realtors Private Limited.

d. For commitment under Shareholders agreements entered between the Company, FHTL and FHML refer Note 22.

e. The Company is obligated to provide exit to investors in SRL Limited, subsidiary company through swap of its shares at fair market value under terms of share purchase agreement for Compulsory Convertible Preference Shares issued by the subsidiary company.

f. The Company has other commitments, for purchase/sales order which are issued after considering requirements per operation cycle for purchase/sale of service, employeeâs benefits. The company does not have any long term commitments or material non-cancellable contractual commitments/ contracts, including derivative contracts for which there were any material foreseeable losses.

g. These were no amount which were required to be transferred to be the investor education and protection fund by the company.

10. Hospital service and management fees

The company has entered into individual Hospital and Medical Service Agreement(HMSA) with RHT Health Trust (formerly known as Religare Health Trust Group of companies (RHT)) wherein the RHT provides and maintains the clinical establishments along with other service like out-patient diagnostics and radio diagnostic to the company the term of individual HMSA is 15 year and the company is required to pay a composite service fee i.e. base and variable fee. The base fee is fixed at the beginning of each year and increase 3% year on year. The variable fee is based on a percentage of companyâs net operating revenue in accordance with the HMSA.

Note: The amount included above for financial guarantee contracts towards loan outstanding are the maximum amounts the Company could be forces to settle under the loan arrangement for the full guaranteed amount if that is claims by the counterparty.

Based on expectations at the end of the reporting period, the Company considers that it is more likely than not that such amount will not be payable under the arrangement. However, this estimate is subject to change depending on the financial position of the subsidiary company. Based on the assessment made by the Company the Fair Value of Financial guarantees is Nil as at March 31, 2017. (as at March 31, 2016 Nil and as at April 01, 2015 is Nil)

3) Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/ its subsidiaries and holding company. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan âA. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 options (Grant III) were granted during the year ended March 31, 2010, 1,302,250 options (Grant IV) were granted during the year ended March 31, 2011 and 200,000 options (Grant V) were granted during the year ended March 31, 2012. Under plan âBâ, 4,050,000 options (Grant VI) were granted during the year ended March 31, 2013, 3,715,000 options (Grant VII) were granted during the year ended March 31, 2014, 240,000 option (Grant VIII) were granted during the year March 31, 2015, 100,000 option (Grant IX) during the previous year and 2,500,000 options (Grant X) were granted during the previous year. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company. As at March 31, 2017, the following schemes were in operation:

4) Employee Benefits Plan: Defined Contribution Plan

The Company recognized Rs,. 807.37 lacs (previous year Rs, 860.46 lacs) for Provident Fund and Employee state insurance contribution in the statement of profit and loss account. The Contribution payable to the plan by the Company is at the rate specified in rules to the scheme.

Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn basic salary) for each completed year of service subject to a maximum limit of Rs, 1,000,000 in terms of the provisions of Gratuity Act, 1972. Vesting occurs upon completion of 5 years of service. The Gratuity is unfunded.

The following table summarizes the components of net benefit expenses recognized in the statement of profit and loss and the amounts recognized in the balance sheet.

The Board of Directors manages the financial risk of the Company through internal risk reports which analyse exposure by magnitude of risk. The Company has limited exposure from the international market as the Companyâs operations are in India. The Company has limited exposure towards foreign currency risk it earns approx. 10% of its revenue from in foreign currency from international patients. Also capital expenditure includes capital goods purchased in foreign currency through the overseas vendors. The Company has not taken any derivative contracts to hedge the exposure. However the exposure towards foreign currency foreign currency fluctuation is party hedged naturally on account of receivable from customers and payable to vendors in foreign currency.

Market Risk

The Companyâs activities expose it primarily to the financial risks of changes in interest rates and foreign currency exchange rates.

a) Foreign currency risk management

Foreign currency sensitivity analysis

The company is mainly exposed to the USD& EURO currency.

The following table details the companyâs sensitivity to a 5% increase and decrease in the '' against the USD. 5% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 5% change in foreign currency rates. The sensitivity analysis includes external loans. A positive number below indicates an increase in profit or equity where the '' strengthens 5% against the relevant currency. For a 5% weakening of the '' against the relevant currency, there would be a comparable impact on the profit or equity, and the balances below would be negative.

b) Interest rate risk management

The Companyâs exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note.

Interest rate sensitivity analysis

The sensitivity analyses below have been determined based on the exposure to interest rates at the end of the reporting period. For floating rate liabilities, the analysis is prepared assuming the amount of the liability outstanding at the end of the reporting period was outstanding for the whole year. A 50 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents managementâs assessment of the reasonably possible change in interest rates.

c) Other price risk

The Company investment are in the group companies and are held for strategic purposes rather than for trading purposes.

d) Credit risk management

e) Liquidity risk management

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the companyâs short-term, medium-term and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. Note given below sets out details of additional undrawn facilities that the Company has at its disposal to further reduce liquidity risk.

Liquidity and interest risk tables

The contractual maturity is based on the earliest date on which the Company may be required to pay.

The fair values of the financial assets and financial liabilities included in the level 2 and level 3 categories above have been determined in accordance with generally accepted pricing models based on a discounted cash flow analysis, with the most significant inputs being the discount rate that reflects the credit risk of counterparties.

There was no transfer between Level 1. Level 2 and Level 3 in the period.

ii) Financial Assets measured at Amortized Cost

5) The Company has entered into âOperation and Managementâ agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

6) Restructuring

The Company has completed following restructuring during the year ended march 31, 2015:-

a. The Companyâs primary business consists of provision of Hospital Services through various entities. The Company initiated internal restructuring with a view to streamline and focus companiesâ resources and energies on different divisions and undertakings and to align the business with the internationally emerging trends by moving towards innovative and cost effective methods such as transformation to asset light models. Subsequent to the internal restructuring, the business of certain identified hospitals of the Company have been divided into the following two verticals, such that they are managed under different verticals whilst continuing to have mutual interdependencies:

i. One vertical (the âClinical Establishments Divisionâ) will own, maintain and operate clinical establishments (being fully air conditioned institutions established, and specifically customized and duly fitted with all fixtures, fittings, certain medical equipment and infrastructure required for running and operating the hospitals), along with providing services under outpatient division and radio-diagnostic services (hereinafter referred to as the âClinical Establishment Servicesâ).

ii. The other vertical (the âMedical Services Divisionâ) will undertake the business of running the hospital operations, being hereinafter referred to as provision of medical services, including in-patient services and emergency services (âMedical Servicesâ).

b. In continuance of Companyâs strategy of Asset Light model, During the year ended March 31,2015, the Company had entered in to an agreement with Escorts Heart and Super Specialty Hospital Limited (âEHSSHLâ), a subsidiary of RHT Health Trust (formerly knowns as Religare Health Trust), for transfer of net assets relating to the Mohali Clinical Establishment (in Punjab) to EHSSHL. Such transaction had resulted in net gain of Rs, 265.37 lacs and disclosed as an exceptional item.

7) During the previous year, the Company entered into a Business transfer agreement to sell the business of its hospital at Kangra, Himachal Pradesh as a going concern on a slump sale basis with effect from September 1, 2015. Such transaction had resulted in net loss of Rs,1,545.98 lacs and has been disclosed as an exceptional item. Refer Note 5(xxix)

8) Exceptional item amounting to Rs, 373.28 lacs represents expenses on composite scheme of arrangement and amalgamation. The Board of Directors of the Company at its meeting held on August 19, 2016 approved the proposal to demerge its diagnostic business, including that housed in its majority owned subsidiary SRL Limited (âSRLâ) into another majority owned subsidiary, Fortis Malar Hospitals Limited (âFortis Malarâ) pursuant to a composite scheme of arrangement and amalgamation (âthe Schemeâ). The Scheme also provides for the sale of its hospital business by Fortis Malar to the Company by way of a slump sale. The demerger shall be followed by SRL being merged with Fortis Malar as an integral part of the same Scheme. On transfer of the diagnostic business to Fortis Malar and Fortis Malar issuing its equity shares to the shareholders of the Company, the diagnostic business (including SRL) will be demerged from the Company. The appointed date for the slump sale, demerger and merger under the composite scheme is January 1, 2017. The composite scheme of arrangement and amalgamation is subject to various judicial/regulatory and other required approvals and is therefore not considered as highly probable transaction. Pending such approvals, no effect of the proposed Scheme has been given in the Financial Statements.

9) Statutory bonus amounting to Rs, 275.88 lacs recorded as an exceptional item in previous year ended March 31,

2016 represents the amounts accrued towards incremental bonus payable to existing and deemed employees by the Company for the period from April 1, 2015 to December 31, 2015 due to enactment of The Payment of Bonus (Amendment) Act, 2015 with retrospective effect from April 1, 2014 for which notification was issued in January, 2016.

10) As part of Sponsor Agreement entered between The Trustee-Manager of RHT Health Trust (formerly known as Religare Health Trust), Fortis Global Healthcare Infrastructure Pte. Limited and Hospital Service Companies (collectively referred as âIndemnified partiesâ) with the Company, the Company has provided following indemnities:-

However, the Company will be liable in respect of the indemnity for a maximum period of five years from the Listing Date.

ii. The Company has also undertaken to indemnify (âTax Indemnityâ) each of the Hospital Services Companies and their respective directors, officers, employees and agents (the âInvesting Partiesâ) against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies. Accordingly, Company has till date accrued '' 205.03 lacs (as at March 31, 2016'' 205.03 lacs; and as at April 01, 2015 '' 205.03 lacs) as provision for contingency.

11) During the year ended 31 March, 2012, the Company entered into Share Purchase Agreement with Fortis Health Management Limited (FHML), subsidiary of RHT Health Trust on January, 9 2012, pursuant to which FHML acquired 49% interest held by the Company in Fortis Hospotel Limited (FHTL) at an aggregate consideration of Rs, 37,728.39 lacs. FHTL is the owner of Clinical Establishment at Shalimar Bagh and Gurgaon.

on September 16, 2027. The holder of the CCPS is entitled to receive, only out of legal funds available for the repayment of dividends, dividends in respect of the par value of the invested CCPS at a per annum rate of 0.01%. Subsequently, KHL merged with International Hospitals Limited (âIHLâ), subsidiary of RHT Health Trust.

Further, FHML on September 17, 2012 entered into Shareholdersâ Agreement with the Company, pursuant to which FHML had a call option over the Companyâs 51% interest in FHTL (âFHTL Call Optionâ) at a determined call option price of '' 30,000 lacs, subject to applicable laws including fulfillment of certain conditions and receipt of necessary approvals from all third parties. Per Shareholdersâ Agreement, FHML also had the right to appoint 50% of the directors of FHTL, including the Chairman of the Board of Directors who had the casting vote in case of deadlock on any matter, on all financial and operating policies of the FHTL, brought to the Board of Directors for its approval. Additionally, the Company had assigned its right to receive dividends from FHTL in favour of FHML. The Management thereafter concluded that it does not exercises any control to direct relevant activities of FHTL and does not have any economic interest therefore, deconsolidated FHTL from the Group.

Key terms of CCPS agreement are:-

- In case of FHTL call option - the Company is required to pay call option price determined at '' 30,000 Lacs, subject to compliance with the applicable law.

- In case of FHTL put option - the Company is required to purchase, subject to due compliance with law, all CCPS at consideration equal to IHLs contribution along with coupon rate agreed.

In accordance with Ind AS 109, the Companyâs 51% interest in FHTL has been recognized at Rs, 30,000 lacs as receivable from associate company, in the opening Balance Sheet prepared under Ind AS, being the amount committed to be provided to the Company on transfer of legal right in FHTL on receipt of regulatory approval, which as per Management was more likely to receive being prefunctionary in nature. The amount was earlier recognized at Rs, 20,739.71 lacs (at derived cost) under the previous GAAP.

During the previous year ended 31 March, 2016, the Board of directors approved the acquisition of 51% economic interest in FHTL, basis which the Management classified the amounts recorded in the financial statement as non-current as at 31 March, 2016.

During the current year ended 31 March, 2017, the Company completed the acquisition of 51% economic interest in FHTL by way of acquiring 51% of the compulsorily convertible debentures (CCDs) from Fortis Global Healthcare Infrastructure Pte Ltd (FGHIPL)-a subsidiary of RHT Health Trust (RHT) for an aggregate consideration of Rs, 110,093 lacs on 13 October, 2016. As per the Amended and Restated Shareholders Agreement (âSHAâ) signed between FHML, effective on completion of acquisition of CCDs, the Company

has the right to appoint majority of the non-independent directors of FHTL, including the Chairman of the Board of Directors of FHTL who has casting vote in case of deadlock in relation to any matter at a meeting of the Board of Directors. The Management has concluded that it has obtained control over FHTL, as it now has control to direct relevant activities and therefore consolidated FHTL in the Group w.e.f. 13 October 2016.

Fortis Hospitals Limited, subsidiary of FHL, acquired EHIRCL CCPS from IHL for an aggregate consideration of Rs, 35,669 lacs on October 13, 2016.

Further, other terms of the Share Purchase Agreement in relation to Call and Put Option have been deleted and the Company has therefore reversed the derivative asset of Rs, 5,636 Lacs recorded in standalone books of account in the current year ended 31 March, 2017.

12) During the year ended March 31, 2011, the Company had issued 1,000 5% Foreign Currency Convertible Bonds of US Dollar 1 lac each aggregating to US Dollar 1,000 lacs due 2015 (the âBondsâ). These Bonds were listed on the Euro MTF market of the Luxembourg Stock Exchange. The Bonds were convertible at the option of the holder at any time on or after May 18, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to May 11, 2015 into fully paid equity shares with full voting rights at par value of Rs, 10 each of the Company (âSharesâ) at an initial Conversion Price (as defined in the âTerms & Conditions of the Bondsâ) of Rs, 167 with 26,922.1557 shares being issued per Bond with a fixed rate of exchange on conversion of Rs, 44.96 = US Dollar 1.00. The Conversion Price was subject to adjustment in certain circumstances.

The Bonds were redeemable, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds were redeemable, in whole but not in part, at the option of the Company at any time on or after 18 May 2013 (subject to the Company having given at least 30 daysâ notice) at 100 percent of their aggregate principal amount plus accrued but unpaid interest if the closing price of the Shares on each trading day with respect to the shares for a period of at least 30 consecutive such trading days is equal to or greater than 130 per cent of the Accreted Conversion Price (as defined in the terms and conditions of the Bonds).

The Bonds were redeemable in whole, but not in part, at the option of the Company subject to satisfaction of certain conditions including obtaining Reserve Bank of India (âRBIâ) approval, at certain early redemption amount, as specified, on the date fixed for redemption in the event of certain changes relating to taxation in India.

The Bonds were redeemed by the Company in US Dollars on May 18, 2015 at 103.1681 per cent of its principal amount at exchange rate of Rs, 63.59357= US Dollar 1. The Company has utilized Securities premium account and provided for the proportionate premium on redemption for the period up to the date of redemption amount to Rs, 2,014.71 lacs (as at March 31, 2016Rs, 2,014.71 lacs and as at March 31, 2015 Rs, 1,922.85 lacs).

The effective interest rate on the liability element on initial recognition, pursuant to such segregation is 6.19 % per annum.

13) During the year ended March 31, 2014, the Company issued 150 Foreign Currency Convertible Bonds aggregating to US Dollar 300 lacs due 2018 (the âBondsâ) at the rate of (4.66% LIBOR). These Bonds were listed on the Singapore Exchange Securities Trading Limited (the âSGX-STâ).

The Bonds were convertible up to US Dollar 240 lacs of principal amount at the option of the holder at any time on or after September 17, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to August 01, 2018 into fully paid equity shares with full voting rights at par value of Rs, 10 each of the Company (âSharesâ) at an initial Conversion Price (as defined in the âTerms & Conditions of the Bondsâ) of Rs, 99.09 with 120,471 shares being issued per Bond with a fixed rate of exchange on conversion of Rs,59.6875 = US Dollar 1.00. The Conversion Price was subject to adjustment in certain circumstances.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

The proceeds of the issue amounting to Rs, 18,390.74 lacs were used for repayment of debts.

During the current year, the Company allotted 18,070,650 equity shares to Standard Chartered (Mauritius) III Limited against USD 30 Million FCCB, on exercise of conversion option as per Offering Circular.

The effective interest rate on the liability element on initial recognition, pursuant to such segregation is 6.03 % per annum.

14) During the year ended March 31, 2014, the Company issued 550 Foreign Currency Convertible Bonds of US Dollar 1 lac each aggregating to US Dollar 550 lacs due 2018 (the âBondsâ) at the rate of LIBOR 4.86%. The Bonds were convertible at the option of International Finance Corporation (âIFCâ), an international organization established by Articles of Agreement among its member countries including the Republic of India (the holder) giving 7 day notice to the Company at any time on or after June 07, 2013 up to June 08, 2018 into fully paid equity shares with full voting rights at par value of '' 10 each of the Company (âSharesâ) at an initial Conversion Price (as defined in the âTerms & Conditions of the Bondsâ) of '' 99.09 and number of shares to be issued would be calculated on conversion on the basis of applicable rate of exchange of US Dollar and IKI on conversion date. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

During the current year, the Company allotted 35,690,887 equity shares to International Finance Corporation against USD 55 Million FCCB, on exercise of conversion option as per FCCB Subscription Agreement.

The effective interest rate on the liability element on initial recognition, pursuant to such segregation is 5.28 % per annum.

15) Details of dues to Micro and Small Enterprises as per MSMED Act, 2006

During the period ended December 31, 2006, Government of India has promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 which comes into force with effect from October 2, 2006. As per the Act, the Company is required to identify the Micro, Small and Medium suppliers and pay them interest on overdue beyond the specified period irrespective of the terms agreed with the suppliers. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements

Explanation : for the purpose of this clause, the term âSpecified Bank Notesâ shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economics Affairs number S.O. 3407 (E), dated 8 November, 2016.

16) First Time Ind AS Adoption Reconciliations

For all periods up to and including the year ended 31st March, 2016, the Company had prepared its financial statements in accordance with the accounting standards notified under Section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 (âPrevious GAAPâ). This note explains the principal adjustments made by the Company in restating its financial statements prepared under Previous GAAP for the following

a) Effect of Ind AS adoption on the standalone balance sheet as at March 31, 2016 and April 01, 2015.

b) Reconciliation of total equity as at March 31, 2016 and April 01, 2015.

c) Effect of Ind AS adoption on the standalone profit and loss for the year ended March 31, 2016.

17) Previous year Figures

Previous year figures have been regrouped/ reclassified, where necessary, to conform to this yearâs classification.

18) The comparative financial information of the Company for the transition date opening balance sheet as at 1 April 2015 included in these standalone Ind AS financial statements, are based on the statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 for the year ended 31 March 2015 have been restated to comply with Ind AS and in accordance with the format prescribed in MCA Circular Notification No. GSR 404(E) [F.NO.17/62/2015CLV], dated 6 April 2016.

Mar 31, 2016

1. Nature of operations

Fortis Healthcare Limited (the ''Company'' or ''FHL'') was incorporated in the year 1996 and commenced its hospital operations in the year 2001. As part of its business activities, the Company holds interests in its subsidiaries, joint ventures and associate companies through which it manages and operates a network of multi-specialty hospitals and diagnostic centers. The Company''s equity shares are listed on both BSE Limited and National Stock Exchange of India. The Company''s 4.66% LIBOR foreign currency convertible bonds are listed on the Singapore Exchange Securities Trading Limited (the "SGX-ST").

2) Basis of preparation

The financial statements of the Company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act 2013. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

2. Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises, few medical equipments and other premises are obtained on operating lease. The total lease payments in respect of such leases recognised in the statement of profit and loss for the year are Rs.1,805.62 lacs (Previous year Rs.2,262.21 lacs) out of which amount of rent capitalized during the year are Rs.1,225.21 lacs (Previous year Rs.1,212.24 lacs).

(b) Assets given on Operating Lease

i) The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. The total lease income received / receivable in respect of the above leases recognised in the statement of profit and loss for the year are Rs.28.63 lacs (Previous year Rs.26.32 lacs).

ii) The Company has leased out certain capital assets on operating lease to a Trust managing hospital operations. The lease term is for 3 years and thereafter renewable at the option of the lessor. The lease arrangement is non-cancellable in nature. The details of the capital assets given on operating lease are as under:

3. Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/ its subsidiaries and holding company. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan ''A''. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 options (Grant III) were granted during the year ended March 31, 2010, 1,302,250 options (Grant IV) were granted during the year ended March 31, 2011 and 200,000 options (Grant V) were granted during the year ended March 31, 2012. Under plan ''B'', 4,050,000 options (Grant VI) were granted during the year ended March 31, 2013, 3,715,000 options (Grant VII) were granted during the year ended March 31, 2014, 240,000 option (Grant VIII) were granted during the year March 31, 2015, 100,000 option (Grant IX) during the current year and 2,500,000 options (Grant X) were granted during the current year. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company. The weighted average share price of the Company during the year was Rs.170.22 (Previous year Rs.118.67). As at March 31, 2016, the following schemes were in operation:

4. Disclosures under Accounting Standard - 15 (Revised) on ''Employee Benefits'': Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn basic salary) for each completed year of service subject to a maximum limit of Rupees 1,000,000 in terms of the provisions of Gratuity Act, 1972. Vesting occurs upon completion of 5 years of service. The Gratuity fund is unfunded.

The following table summarizes the components of net benefit expenses recognised in the statement of profit and loss and the amounts recognized in the balance sheet.

5. The Company has entered into ''Operation and Management'' agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

6. Restructuring

The Company has completed following restructuring during the previous year ended 31 March, 2015:-

a. The Company''s primary business consists of provision of Hospital Services through various entities. The Company initiated internal restructuring within the Company with a view to streamline and focus Group companies'' resources and energies on different divisions and undertakings and to align the business with the internationally emerging trends by moving towards innovative and cost effective methods such as transformation to asset light models. Subsequent to the internal restructuring completed during the year, the business of certain identified hospitals of the Company are being divided into the following two verticals, such that they are managed under different verticals whilst continuing to have mutual interdependencies:

(i) One vertical (the "Clinical Establishments Division") will own, maintain and operate clinical establishments (being fully air conditioned institutions established, and specifically customized and duly fitted with all fixtures, fittings, certain medical equipment and infrastructure required for running and operating the hospitals), along with providing services under outpatient division and radio-diagnostic services (hereinafter referred to as the "Clinical Establishment Services").

(ii) The other vertical (the "Medical Services Division") will undertake the business of running the hospital operations, being hereinafter referred to as provision of medical services, including in-patient services and emergency services ("Medical Services").

b. In continuance of Company''s strategy of Asset Light model, during the previous year, the Company had entered in to an agreement with Escorts Heart and Super Specialty Hospital Limited ("EHSSHL"), a subsidiary of Religare Health Trust, for transfer of net assets relating to the Mohali Clinical Establishment (in Punjab) to EHSSHL. Such transaction had resulted in net gain of Rs.265.37 lacs and disclosed as an exceptional item.

c. During the year ended 31 March, 2014, the Board of Directors of the Company at its meeting held on March 25, 2014 approved the purchase of operations of Fortis Hospital, Shalimar Bagh from its subsidiary, Fortis Hospitals Limited (''FHsL'') on a going concern basis by way of a slump sale. The Company and FHsL entered into a business transfer agreement (''BTA'') on March 28, 2014 for purchase of operations of Shalimar Bagh for a cash consideration of Rs.4,000 lacs. The transaction has been executed on April 1, 2014 as per the agreement.

7. During the current year, the Company entered into a Business transfer agreement to sell the business of its hospital at Kangra, Himachal Pradesh as a going concern on a slump sale basis with effect from September 1, 2015. Such transaction has resulted in net loss of Rs.1,257.18 lacs and has been disclosed as an exceptional item.

8. Statutory bonus amounting to Rs.275.88 lacs has been recorded as an exceptional item which represents the amount accrued towards incremental bonus payable to existing and deemed employees by the Company for the period from April 1, 2015 to December 31, 2015 due to enactment of The Payment of Bonus (Amendment) Act, 2015 with retrospective effect from April 1, 2014 for which notification was issued in January, 2016.

9. As part of Sponsor Agreement entered between The Trustee-Manager of Religare Health Trust, Fortis Global Healthcare Infrastructure Pte. Limited and Hospital Service Companies (collectively referred as ''Indemnified parties'') with the Company, the Company has provided following indemnities:-

i) To RHT and its directors, officers, employees and agents under the relevant transaction agreements against any losses or liabilities finally determined as payable for any breach of the Consolidated Foreign Direct Investment (FDI) Policy or Foreign Exchange Management Act (''FEMA''), to the extent that such breach has resulted from the acquisition by RHT of the Hospital Services Companies.

Further, the Company has undertaken to transfer or procure additional medical and healthcare services to Hospital Services Companies in the event that any regulatory authority raises concerns over compliance with any applicable law.

However, the Company will not be liable to indemnify the Indemnified Parties for any losses resulting from delay or failure of the Indemnified Parties in completing any statutory filings or similar formalities under the Consolidated FDI Policy, FEMA and other laws in force in India as of the Listing Date i.e. October 19, 2012, required to be undertaken by the Indemnified Parties in relation to the acquisition by RHT or FGHIPL of the equity shares of the Hospital Services Companies.

The Company''s obligations under this indemnity shall continue so long as the Company or the Group holds 15.0% or more of the total units from time to time issued in RHT or three years from the Listing Date, whichever is later.

However, the Company will be liable in respect of the indemnity for a maximum period of five years from the Listing Date.

ii) The Company has also undertaken to indemnify ("Tax Indemnity") each of the Hospital Services Companies and their respective directors, officers, employees and agents (the "Investing Parties") against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies. Accordingly, Company has till date accrued Rs.205.03 lacs (Previous year Rs.205.03 lacs) as provision for contingency. The management based on the computation received does not foresee any change in the provision for contingencies.

iii) Further, as per terms of the various Agreements entered into between Hospital Services Companies and Fortis Operating companies, the Hospital Services Companies have right to recover certain statutory dues levied on them from Fortis Operating Companies. There is a possible present obligation on Hospital Services Companies to collect certain statutory dues from the Fortis Operating Companies and pay it to the relevant authorities. In view of uncertainty arising from interpretation of the regulations, management believes that value of such statutory dues cannot be measured reliably and therefore has not been considered in these financial statements.

10. On January, 9 2012, FHML entered into Share Purchase Agreement with the Company to acquire its 49% interest in FHTL at an aggregate consideration of Rs.37,728.39 lacs. FHTL is the owner of Shalimar Bagh Clinical Establishment and Gurgaon Clinical Establishment. FHML on September 17, 2012 entered into Shareholders'' Agreement with the Company, pursuant to which FHML has a call option over the Company''s 51% interest in FHTL ("FHTL Call Option") at a fixed price, subject to fulfillment of certain conditions, applicable laws including, and receipt of necessary approvals from all third parties. FHML also has the right to appoint 50% of the directors of FHTL, including the chairman of the board of directors who will have the casting vote in case of deadlock on any matter, including all financial and operating policies of the Company, brought to the board of directors for its approval. Additionally, the Company has assigned its right to receive dividends from FHTL in favour of FHML. In addition, FHML has a put option on its 49% interest in FHTL ("FHTL Put Option"), exercisable if FHML is unable to acquire 100% of the issued and paid-up share capital of FHTL within 5 years from the date of transfer of the 49% shareholding of FHTL by the Company to FHML, for any reason outside the control of FHML. The put option shall be exercised at a price that is equal to the fair market value of Put Securities on the date of exercise of put option, determined on a discounted cash flow basis.

During the current year, The Board of Directors of the Company approved the acquisition of 51% economic interest in FHTL. The Management is in process of obtaining the legal and regulatory approvals and intends to hold the investment for a long-term period. Accordingly, management has reclassified the investment in FHTL as non-current as at March 31, 2016 [Refer to note 4(xii)].

11. During the year ended March 31, 2013, Escorts Heart Institute and Research Centre Limited (''EHIRCL'') have issued 401,769 Compulsorily Convertible Preference Shares (''CCPS'') of face value of Rs.10 each at a premium of Rs.7,456.98 per CCPS to Kanishka Healthcare Limited (''KHL'') with a maturity period of 15 years aggregating to Rs.30,000 lacs. During the previous year ended March 31, 2013, KHL merged with International Hospital Limited (IHL). Following are the key terms of CCPS:-

a) CCPS Put Option - IHL is entitled to exercise an unconditional and irrevocable right to require the Company or its nominee to buy all of CCPS upon occurrence of IHL having exercised FHTL Put Option or FHTL Call Option under shareholders agreement entered between the Company, FHTL and FHML, as per above.

b) Under FHTL call Option the Company is required to pay sum equal to the fair valuation of Equity Shares of EHIRCL as per DCF Method.

c) In case of FHTL put option Company has right to purchase, subject to due compliance with law, all CCPS at consideration equal to IHL''s contribution along with coupon rate agreed.

12. During the year ended March 31, 2011, the Company had issued 1,000 5% Foreign Currency Convertible Bonds of US Dollar 1 lac each aggregating to US Dollar 1,000 lacs due 2015 (the "Bonds"). These Bonds were listed on the Euro MTF market of the Luxembourg Stock Exchange. The Bonds were convertible at the option of the holder at any time on or after May 18, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to May 11, 2015 into fully paid equity shares with full voting rights at par value of Rs.10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs.167 with 26,922.1557 shares being issued per Bond with a fixed rate of exchange on conversion of Rs.44.96 = US Dollar 1.00. The Conversion Price was subject to adjustment in certain circumstances.

The Bonds were redeemable, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds were redeemable, in whole but not in part, at the option of the Company at any time on or after 18 May 2013 (subject to the Company having given at least 30 days'' notice) at 100 percent of their aggregate principal amount plus accrued but unpaid interest if the closing price of the Shares on each trading day with respect to the shares for a period of at least 30 consecutive such trading days is equal to or greater than 130 per cent of the Accreted Conversion Price (as defined in the terms and conditions of the Bonds).

The Bonds were redeemable in whole, but not in part, at the option of the Company subj ect to satisfaction of certain conditions including obtaining Reserve Bank of India ("RBI") approval, at certain early redemption amount, as specified, on the date fixed for redemption in the event of certain changes relating to taxation in India.

The Bonds were redeemed by the Company in US Dollars on May 18, 2015 at 103.1681 per cent of its principal amount at exchange rate of Rs.63.59357= US Dollar 1. The Company has utilized Securities premium account and provided for the premium on redemption for the period up to the date of redemption amounting to Rs.2,014.71 lacs (Previous year Rs.1,922.85 lacs). Accordingly, the corresponding Debenture redemption reserve has been transfered to the Surplus in Statement of Profit & Loss.

13. During the year ended March 31, 2014, the Company issued 150 Foreign Currency Convertible Bonds aggregating to US Dollar 300 lacs due 2018 (the "Bonds") at the rate of (4.66% LIBOR). These Bonds are listed on the Singapore Exchange Securities Trading Limited (the "SGX-ST").

The Bonds are convertible upto US Dollar 240 lacs of principal amount at the option of the holder at any time on or after September 17, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to August 01, 2018 into fully paid equity shares with full voting rights at par value of Rs.10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs.99.09 with 120,471.29 shares being issued per Bond with a fixed rate of exchange on conversion of Rs.59.6875 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

Subject to certain conditions, the Bonds may be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond outstanding (but in no event exceeding US Dollar 60 lacs in aggregate principal amount of Bonds), at the option of the Company at any time on or after September 17, 2013 up to August 01, 2018 at the Partial Reset Conversion Price (as defined in the "Terms & Conditions of the Bonds").

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on August 08, 2018 at 100 per cent of its principal amount. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

The Company has incurred expenses of Rs.542.62 lacs (including Rs.24.72 lacs paid to Auditors) in connection with this issue.

The proceeds of the issue amounting to Rs.18,390.74 lacs were used for repayment of debts.

Exchange Rate at March 31, 2016 considered for restatement of the Bonds at the year-end was Rs.66.17526= US Dollar 1 (Rs.62.33553= US Dollar 1 at March 31, 2015).

14. During the year ended March 31, 2014, the Company issued 550 Foreign Currency Convertible Bonds of US Dollar 1 lac each aggregating to US Dollar 550 lacs due 2018 (the "Bonds") at the rate of LIBOR 4.86%. The Bonds are convertible at the option of International Finance Corporation ("IFC"), an international organization established by Articles of Agreement among its member countries including the Republic of India (the holder) giving 7 days notice to the Company at any time on or after June 07, 2013 up to June 08, 2018 into fully paid equity shares with full voting rights at par value of Rs.10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs.99.09 and number of shares to be issued will be calculated on conversion on the basis of applicable rate of exchange of US Dollar and '' on conversion date. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may be converted on the request of the holder but not less than value of US Dollar 5,000,000 or in multiple of US Dollar 1,000,000 thereafter. Except in certain condition mentioned in the "Terms & Conditions of the Bonds" the holder cannot exercise the Conversion Option in part or in full in respect of twenty per cent (20%) of the original bond value for a period of three (3) years after the Subscription Date.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond at the option of the Company at any time on or after June 07, 2013 at Modified Conversion Price (as defined in the "Terms & Conditions of the Bonds").

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on June 08, 2018 at 100 per cent of its principal amount. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2016 considered for restatement of the Bonds at the year-end was Rs.66.17526= US Dollar 1 (Rs.62.33553= US Dollar 1 at March 31, 2015).

15. Details of dues to Micro and Small Enterprises as per MSMED Act, 2006

During the period ended December 31, 2006, Government of India has promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 which comes into force with effect from October 2, 2006. As per the Act, the Company is required to identify the Micro, Small and Medium suppliers and pay them interest on overdue beyond the specified period irrespective of the terms agreed with the suppliers. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements.

16. During the year, the Company has capitalised the following expenses to the cost of fixed asset/ capital work in progress (CWIP). Consequently, expenses disclosed under the respective notes are net of amount capitalised by the Company.

17. Corporate social responsibility

As per section 135 of the Companies Act, 2013 and rules therein, the Company is required to spend at least 2% of average net profit of past three years towards Corporate Social Responsibility (CSR). Details of corporate social responsibility expenditures as certified by Management are as follows:

18. Previous Year Figures

Previous year figures have been regrouped / reclassified, where necessary, to conform to this year''s classification. Figures for the previous year have been audited by another firm of Charered Accountants.

Mar 31, 2015

1. Nature of Operations

Fortis Healthcare Limited (the ''Company'' or ''FHL'') was incorporated in the year 1996 and commenced its hospital operations in the year 2001. As part of its business activities, the Company holds interests in its subsidiaries, joint ventures and associate companies through which it manages and operates a network of multi- specialty hospitals and diagnostic centres. The Company''s equity shares are listed on both BSE Limited and National Stock Exchange of India Ltd. The Company''s 5% foreign currency convertible bonds were listed on the Euro MTF market of the Luxembourg Stock Exchange and 4.66% LIBOR foreign currency convertible bonds are listed on the Singapore Exchange Securities Trading Limited (the "SGX-ST").

2. Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014. The financial statements have been prepared on an accrual basis.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policies explained subsequently.

Other Notes:

1.Share Capital

(a) Terms/ rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

(b) Terms of redemption of preference shares

During the year ended March 31, 2009, the Company issued 1,450,000 Class ''C'' Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each at a premium of Rs. 90 per share. Preference shares were redeemable at a premium of Rs. 117.69 per preference share, on October 18, 2010, however, the date of redemption of October 18, 2010 has been deferred to October 18, 2014 at the redemption premium of Rs. 198.20 per share. Both the Company and the subscriber had an option for early redemption of the Preference Shares. In case the early redemption option would have been exercised, the premium on redemption shall be adjusted proportionately. Preference shares were redeemed on October 28, 2013 at a redemption price of Rs. 184.96 per share including redemption premium of Rs. 174.96 per share.

During the year ended March 31, 2008, the Company issued 11,500,000 Class ''C'' zero percent cumulative redeemable preference shares of Rs. 10 each at a premium of Rs. 90 per share, out of which 3,196,000 zero percent cumulative redeemable preference shares were still pending for redemption at the beginning of the year. These shares were redeemable at Rs. 175 per share, including premium, on October 18 of 2008, 2009, 2010, 2011 and 2012, respectively in installment of Rs. 1,437.50 lacs each and installment of Rs. 12,937.50 lacs on October 18, 2013. The Company had the option to make voluntary premature redemption of the Shares in part or in full in which event the redemption premium would have been computed @ 12% compounded annually on the subscription amount from the subscription date till the redemption date. However, the due date of redemption in 2009, 2010, 2011, 2012 and 2013, respectively has been postponed to October 18, 2014 and due to this, the Company has agreed to pay additional redemption premium calculated at 12%, 12.5%, 13%, 13% and 13%, respectively on the redemption amounts due in respective years. In the event of liquidation of the Company before redemption of preference shares, the holder of preference shares will have priority over equity shares in the repayment of capital. Preference shares were redeemed on October 28, 2013 at a redemption price of Rs. 181.36 per share including redemption premium of Rs. 172.36 per share.

(c) Shares reserved for issue under options

For details of shares reserved for issue under the employee stock option plan (ESOP) of the Company, please refer note 10.

(d) Shares reserved for issue on conversion

For details of shares reserved for issue on conversion of bonds, please refer note 17, 18 & 19 regarding terms of conversion/ redemption of bonds.

2. Related party disclosures

Names of related parties and related party relationship

Ultimate Holding Company

RHC Holding Private Limited (Holding Company of Fortis Healthcare Holdings Private Limited)

Holding Company

Fortis Healthcare Holdings Private Limited (''FHHPL'')

Subsidiary Companies - direct or indirect through investment in subsidiaries

1 Fortis Hospotel Limited (''FHTL'') (refer note 15)

2 Hiranandani Healthcare Private Limited (''HHPL'')

3 Fortis La Femme Limited (''FLFL'') (formerly known as Fortis Health Management (West) Limited)

4 Fortis Health Management (North) Limited (''FHMNL'')*****

5 Fortis C-Doc Healthcare Limited (''C-Doc'')

6 Fortis Health Management (East) Limited (''FHMEL'')

7 SRL Limited (''SRL'')

8 SRL Diagnostics Private Limited (''SRLDPL'')

9 Fortis Healthcare International Limited (''FHIL'')

10 Fortis Global Healthcare (Mauritius) Limited (''FGHML'')

11 Fortis Hospitals Limited (''FHsL'')*****

12 Fortis Cancer Care Limited (''FCCL'') (formerly known as Fortis Health Management (South) Limited)

13 Lalitha Healthcare Private Limited (''LHPL'')

14 Fortis Malar Hospitals Limited (''FMHL'')

15 Malar Stars Medicare Limited (''MSML'')

16 Escorts Heart Institute and Research Centre Limited (''EHIRCL'')

17 Fortis HealthStaff Limited (''FHSL'')

18 Fortis Asia Healthcare Pte Limited (''FAHPL'')

19 Fortis Healthcare International Pte Limited (''FHIPL'')

20 Fortis Healthcare Australia Pty Ltd (''FHAPL'') (upto October 22,2014)

21 Dental Corporation Holdings Limited (''DCHL'') (up to May 31, 2013)**

22 Dental Corporation Pty Limited (''DCPL'') (up to May 31, 2013)**

23 Dental Corporation Petrie Pty Ltd (up to May 31, 2013)**

24 Dental Corporation Levas Pty Ltd (up to May 31, 2013)**

25 D C Holdings WA Pty Ltd (up to May 31, 2013)**

26 Dental Care Network Pty Limited (up to May 31, 2013)**

27 Dental Corporation (NZ) Limited (up to May 31, 2013)**

28 Dental Corporation Cox Pty Ltd (up to May 31, 2013)**

29 Hazel Ridge Pty Limited (up to May 31, 2013)**

30 John M Levas Pty Limited (up to May 31, 2013)**

31 Scott Petrie Dental Pty Ltd (up to May 31, 2013)**

32 Larry Benge Pty Ltd (up to May 31, 2013)**

33 Dr Chris Hardwicke Pty Ltd (up to May 31, 2013)**

34 Fortis Healthcare Singapore Pte Ltd (''FHSPL'')

35 Radlink Asia Pte Limited (''RADLINK'')

36 Radlink Medicare Pte Limited (''RMPL'')

37 DRS Thompson & Thomson (Radlink Medicare) Pte Limited

38 Radlink Medicare (Bishan) Pte Limited

39 Radlink Medicare (Woodlands) Pte Limited

40 Radlink Medicare (Tampines) Pte Limited

41 Radlink Medicare (Jurong East) Pte Limited

42 Clinic 1866 Pte Limited

43 Radlink Diagnostic Imaging (S) Pte Limited (''RDISPL'')

44 Drs Lim Hoe & Wong Radiology Pte limited

45 Healthcare Diagnostic Services Pte Limited

46 Radlink Women & Fetal Imaging Centre Pte Limited

47 Radlink Pet & Cardiac Imaging Centre Pte Limited (''RADLINK PET'')

48 Singapore Radiopharmaceuticals Pte Limited

49 Singapore Molecular Therapy Centre Pte Limited

50 Altai Investments Limited (''ALTAI'') (up to October 24, 2013)****

51 Quality HealthCare Limited (''QHL'') (up to October 24, 2013)****

52 Quality HealthCare Hong Kong Limited (up to October 24, 2013)****

53 Green Apple Associates Limited (up to October 24, 2013)****

54 Quality HealthCare Medical Services Limited (up to October 24,2013)

55 Fortis HealthCare Hong Kong Limited (''Fortis Honkong'') (up to October 24, 2013)****

56 Quality Healthcare Medical Services (Macau) Limited (up to October 24, 2013)****

57 Quality HealthCare Chinese Medicine Limited (''QHCML'') (up to October 24, 2013)****

58 Marvellous Way Limited (up to October 24, 2013)****

59 Universal Lane Limited (''ULL'') (up to October 24, 2013)****

60 DB Health Services Limited (up to October 24, 2013)****

61 Quality HealthCare Medical Centre Limited (up to October 24,2013)***

62 Quality HealthCare Professional Services Limited (up to October 24, 2013)****

63 SmartLab Limited (up to October 24, 2013)****

64 GlobalRx Limited (up to October 24, 2013)****

65 Allied Medical Practices Guild Limited (up to October 24, 2013)****

66 Fortis Hospitals Hong Kong Limited (up to October 24, 2013)****

67 Normandy (Hong Kong) Limited (''NHKL'')(up to October 24, 2013)****

68 Great Option Limited (Hong Kong)(up to October 24, 2013)****

69 Healthcare Opportunities Limited (''HOL'')(up to October 24, 2013)****

70 TCM Products Limited (''TCM'')(up to October 24, 2013)****

71 GHC Holdings Limited (''GHC'')(up to October 24, 2013)****

72 Case Specialist Limited (up to October 24, 2013)****

73 Jadeast Limited (up to October 24, 2013)****

74 Jadefairs International Limited (up to October 24, 2013)****

75 Jadway International Limited (up to October 24, 2013)****

76 Megafaith International Limited (up to October 24, 2013)****

77 Jadison Investment Limited (up to October 24, 2013)****

78 Berkshire Group Limited (up to October 24, 2013)****

79 Central Medical Diagnostic Centre Limited (''CMDCL'') (up to October 24, 2013)****

80 Central MRI Centre Limited (up to October 24, 2013)****

81 Central Medical Laboratory Limited (up to October 24, 2013)****

82 Central PET/CT Scan Limited (up to October 24, 2013)****

83 Portex Limited (up to October 24, 2013)****

84 Quality HealthCare Services Limited (''QHCSL'')(up to October 24, 2013)****

85 Quality HealthCare Psycological Services Limited (''QHCPSL'') (up to October 24, 2013)****

86 Quality EAP (Macau) Limited (up to October 24, 2013)****

87 Quality HealthCare Dental Services Ltd (up to October 24, 2013)****

88 Quality HealthCare Physiotherapy Services Limited (up to October 24, 2013)****

89 Quality HealthCare Nursing Agency Limited (up to October 24, 2013)****

90 Dynamic People Group Limited (up to October 24, 2013)****

91 Mena Healthcare Investment Company Limited (''MHICL'')

92 SRL Diagnostics FZ-LLC (formerly known as Super Religare Laboratories International FZ LLC)

93 Swindon Limited (SL) (up to August 20, 2013)***

94 VOF PE Holdings 2 Limited (''VOFPEHL'')(up to August 20, 2013)***

95 Fortis Hoan My Medical Corporation (''HOAN'')(up to August 20, 2013)**

96 Fortis Hoan My Saigon General Hospital Joint Stock Company (''MY SAIGON'') (up to August 20, 2013)***

97 Hoan My Clinic Co. Ltd (up to August 20, 2013)***

98 Hoan My Da Nang General Hospital Joint Stock Company (up to August 20, 2013)***

99 Hue Hoan My General Hospital Joint Stock Company (up to August 20, 2013)***

100 Hoan My Cuu Long General Hospital Joint Stock Company (up to August 20, 2013)***

101 Hoan My Da Lat General Hospital Joint Stock Company (up to August 20, 2013)***

102 Fortis Healthcare Vietnam Company Limited (up to August 20, 2013)***

103 Medical Management Company Limited

104 Fortis Healthcare Middle East LLC (w.e.f. May 23, 2013)

105 Healthcare Clinic and Surgery Pte. Limited

106 Birdie & Birdie Realtors Private Limited (w.e.f. May 6, 2014)

107 Fortis CSR Foundation (w.e.f. September 22, 2014)

Companies (5) and (6) of above are subsidiaries of FHsL; Company (8) of above is subsidiary of SRL; Company (10) of above is a subsidiary of FHIL; Companies (12) and (14) and 106 of above are subsidiaries of FHsL; Company (13) of above is subsidiary of FCCL; Company (15) of above is a subsidiary of FMHL; Companies (17) and (18) of above are subsidiaries of EHIRCL; Company (19) of above is subsidiary of FAHPL; Company (20), (34), (50), (91), (92), (93), (94), (102) and (104) of above are subsidiaries of FHIPL; Company (21) of above was subsidiary of FHAPL; Company (22) of above was subsidiary of DCHL; Companies (23) to (33) of above were subsidiaries of DCPL; Company (35) of above is subsidiary of FHSPL; Companies (36) and (43) of above are subsidiaries of RADLINK; Companies (37) to (42) and 105 of above are subsidiaries of RMPL; Companies (44) to (47) of above are subsidiaries of RDISPL; Companies (48) and (49) of above are subsidiaries of RADLINK PET; Companies (51), (54), (55), (83) and (84) of above were subsidiaries of ALTAI; Companies (52) and (53) of above were subsidiaries of QHL; Companies (56), (57), (59), (61) to (67), (69), (78) and (79) of above were subsidiaries of Fortis Honkong; Company (58) of above was subsidiary of QHCML; Company (60) of above was subsidiary of ULL; Company (68) of above was subsidiary of NHKL; Company (70) of above was subsidiary of HOL; Company (71) of above was subsidiary of TCM; Companies (72) to (77) of above were subsidiaries of GHC; Companies (80) to (82) of above were subsidiaries of CMDCL; Companies (85) and (87) to (90) of above were subsidiaries of QHCSL; Company (86) of above was subsidiary of QHCPSL; Company (97) of above was subsidiary of VOFPEHL; Companies (96), (98), (100) and (101) of above were subsidiaries of HOAN; Company (97) of above was subsidiary of MY SAIGON; Company (103) of above is subsidiary of MHICL; Company (99) of above was a subsidiary of Company (98) of above.

Fellow Subsidiaries (with whom transactions have been taken place)

(a) RWL Healthworld Limited (formerly as Religare Wellness Limited)

(b) Medsource Healthcare Private Limited

Associates (with whom transactions have been taken place)

(a) Sunrise Medicare Private Limited

(b) Medical and Surgical Centre Limited, Mauritius (Associate of Fortis Healthcare International Limited)

(c) International Hospital Limited (''IHL'')******

(d) Escorts Heart and Super Speciality Institute Limited(''EHSSIL'')*****

(e) Escorts Heart and Super Speciality Hospital Limited (''EHSSHL'')

(f) Fortis Emergency Services Limited (''FESL'') (Associate of Fortis Hospitals Limited)

(g) Fortis Health Management Limited (''FHML'')

(h) Fortis Medicare International Limited (''FMIL'')

Joint Ventures

(a) Super Religare Reference Laboratories (Nepal) Private Limited (Joint venture of SRL)

(b) DDRC SRL Diagnostics Services Private Limited (Joint venture of SRLDPL)

(c) Fortis Cauvery, Partnership firm (Joint venture of FCCL)

Key Management Personnel ( KMP )

(a) Mr. Malvinder Mohan Singh - Executive Chairman

(b) Mr. Shivinder Mohan Singh - Executive Vice Chairman

(c) Mr. Balinder Singh Dhillon- Executive Director (upto February 11, 2014)

(d) Mr. Gagandeep Singh Bedi - Chief Financial Officer (w.e.f September 23, 2014)

(e) Mr. Sandeep Puri - Chief Financial Officer (upto September 24,2014)

(f) Mr. Aditya Vij- Chief Executive Officer (upto December 31, 2014)

(g) Mr. Rahul Ranjan - Company Secretary

(h) Mrs. Ritu Vij - Relative of KMP (upto December 31, 2014)

(i) Dr. Brian William Tempest - Non-Executive Director

(j) Mr. Gurcharan Das - Non-Executive Director (upto September 24,2014)

(k) Mr. Harpal Singh - Non-Executive Director

(l) Ms. Joji Sekhon Gill - Non-Executive Director

(m) Ms. Lynette Joy Hepburn Brown - Non-Executive Director (w.e.f. May 29, 2014)

(n) Mr. Pradeep Ratilal Raniga - Non-Executive Director

(o) Dr. Preetinder Singh Joshi - Non-Executive Director

(p) Mr. Ravi Umesh Mehrotra - Non-Executive Director (w.e.f. March 26, 2015)

(q) Ms. Shradha Suri Marwah - Non-Executive Director (w.e.f. March 26, 2015)

(r) Mr. Sunil Godhwani - Non-Executive Director

Enterprises owned or significantly influenced by key management personnel (KMP) or their relatives (with whom transactions have been taken place)

(a) Fortis Nursing and Education Society

(b) Ligare Travel Limited (formerly known as Religare Travels(India) Limited)

(c) Ligare Aviation Limited (formerly known as Religare Aviation Limited)

(d) Dion Global Solutions Limited

3. Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises, few medical equipments and other premises are obtained on operating lease. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. For all cases, there are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. The total lease payments in respect of such leases recognised in the statement of profit and loss for the year are Rs. 1,049.96 lacs (Previous year Rs. 2,670.62 lacs) and capitalized during the year are Rs. 1,212.24 lacs (Previous year Rs. 1,341.99 lacs).

(b) Assets given on Operating Lease

i) The Company has sub-leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. There are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. All these leases are cancellable in nature. The total lease income received / receivable in respect of the above lease recognised in the statement of profit and loss for the year are Rs. 26.32 lacs (Previous year Rs. 116.76 lacs).

ii) The Company has leased out certain capital assets on operating lease to a Trust managing hospital operations. The lease term is for 3 years and thereafter renewable at the option of the lessor. There are no restrictions imposed by the lease arrangements and the rent is not determined based on any contingency. There is no escalation clause in the lease agreements. The lease arrangement is non-cancellable in nature. The details of the capital assets given on operating lease are as under:

4. Commitments:

(a) Going concern support in form of funding and operational support letters issued by the Company in favour of FLFL, FCCL, FHSL, Fortis C-Doc Healthcare Limited, FHMEL, LHPL, FAHPL, Birdie & Birdie Realtors Private Limited.

(b) For commitments relating to lease arrangements, refer note 6.

5. Contingent liabilities (not provided for) in respect of:

(Rs. in lacs)

Particulars As at As at March 31, March 31 2015 2014

Claims against the Company not acknowledged 1,319.13 796.68 as debts (in respect of compensation demanded by the patients/their relatives for negligence) The cases are pending with various Consumer Disputes Redressal Commissions. Based on expert opinion obtained, the management believes that the Company has good chance of success in these cases.

The Company is under litigation with the Income 501.41 579.02 Tax Department against certain income tax demands on account of deduction of tax under section 194J of Income Tax Act, 1961 instead of section 192 on payments made to retainer doctors, u/s 201(1)/201 (1A)for the assessment years 2010-11, 2011-12, 2012-13 and 2013-14, thereby raising demands of Rs. 239.92 lacs (Previous year Rs. 239.92lacs) Rs. 261.49 lacs (Previous year Rs. 261.49 lacs), Rs. 20.87 lacs(Previous year Rs. 77.61 lacs) and Rs. 23.86 lacs (Previous year Nil) respectively. Company had filed appeals with the Commissioner of Income Tax (Appeals), Chandigarh which passed order in favour of the Company for all assessment years. Department has filed further appeal to the Income Tax Appellate Tribunal (ITAT) for assessment years 2010-11 and 2011-12, which is pending for disposal. Based on management assessment, Company believes that it has good chance of success in these cases.

The Excise & Taxation Commissioner cum Designated - 1,412.35 Officer-Mohali had passed an assessment order dated October 08, 2013 under Punjab Value Added Tax Act, 2005 (''PVAT'') thereby raising a demand of Rs. 1,412.35 lacs (including penalty Rs. 741.39 lacs and interest of Rs. 300.26 lacs) holding that the assessee was liable to pay tax on the medical consumables used on in-patients and out-patients and has contravened the provisions of Section 29(2) of PVAT. Company is in appeal before the Hon''ble High Court of Punjab and Haryana against the aforesaid order of Deputy Excise & Taxation Commissioner. Hon''ble High Court admitted appeal filed by the Company and further, granted stays on assessment order vide its order dated January 15, 2014. During the current year, Hon''ble High Court of Punjab and Haryana has been decided the case in favour of the Company.

The Commissioner of Service-tax, Chandigarh has 265.47 215.34 passed an Order dated March 14, 2014 under Service-tax Act alleging that assessee is liable to pay service-tax on support services of business or commerce provided to doctors, thereby raising demand of Rs. 215.34 lacs (Previous year Rs. 215.34 lacs) and Rs. 50.14 lacs (Previous year Nil) for financial years 2007-08 to 2011-12 and 2012-13 respectively. The Company has filed an appeal with Central Excise and Service Tax Appellate Tribunal, which is pending for disposal. Based on management assessment, Company believes that it has good chance of success in these cases.

The Company is under litigation with the Income 332.08 - Tax Department against income tax demand on account of disallowance u/s 14A, disallowance of credit card expenditure, disallowance of foreign travelling expenses and interest income not offered to tax for assessment year 2012-13. Based on management assessment, Company believes that it has good chance of success in this case.

Service Tax Department issued notice alleging 294.35 - therein that one of the Hospital of the Company is providing services of infrastructure and administrative support to Vendors and thus, is liable to pay service-tax on amounts retained from doctors'' fees for the financial years 2008-09 to 2011-12 The Company has filed an appeal with Central Excise and Service Tax Appellate Tribunal, which is pending for disposal. Based on management assessment, Company believes that it has good chance of success in these cases.

(Rs. in lacs)

Particulars As at As at March 31, March 31 2015 2014

Corporate guarantee given to financial institutions/ banks in respect of financial assistance availed by subsidiaries and associates of the Company. None of the corporate guarantee have been evoked by the Banks/Financial institutions during the year as the subsidiaries and associates of the Company have complied with the loan covenants.

- Axis Bank 7,751.00 13,251.00

- Royal Bank of Scotland 1,500.00 1,500.00

- HDFC Bank Limited 22,000.00 14,000.00

- GE Money Financial Services Private Ltd - 14,500.00

- GE Capital Services India Ltd - 5,000.00

- ICICI Bank Ltd 20,000.00 20,000.00

Others - 6.47

6. Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/ its subsidiaries and holding Company. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan ''A''. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 options (Grant III) were granted during the year ended March 31, 2010, 1,302,250 options (Grant IV) were granted during the year ended March 31, 2011 and 200,000 options (Grant V) were granted during the year ended March 31, 2012.Under plan ''B'', 4,050,000 options (Grant VI) were granted to employees during the year ended March 31, 2013, 3,715,000 option (Grant VII) were granted during the year ended March 31, 2014 and 240,000 options (Grant VIII) were granted during the current year. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company.

7. Disclosures under Accounting Standard - 15 (Revised) on ''Employee Benefits'':

Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The following table summarizes the components of net benefit expenses recognised in the statement of profit and loss and the amounts recognized in the balance sheet.

8. The Company has entered into ''Operation and Management'' agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

9. As part of Sponsor Agreement entered between The Trustee-Manager of Religare Health Trust, Fortis Global Healthcare Infrastructure Pte. Limited and Hospital Service Companies (collectively referred as ''Indemnified parties'') with the Company, the Company has provided following indemnities:-

i) To RHT and its directors, officers, employees and agents under the relevant transaction agreements against any losses or liabilities finally determined as payable for any breach of the Consolidated Foreign Direct Investment (FDI) Policy or Foreign Exchange Management Act (''FEMA''), to the extent that such breach has resulted from the acquisition by RHT of the Hospital Services Companies.

Further, the Company has undertaken to transfer or procure additional medical and healthcare services to Hospital Services Companies in the event that any regulatory authority raises concerns over compliance with any applicable law.

However, the Company will not be liable to indemnify the Indemnified Parties for any losses resulting from delay or failure of the Indemnified Parties in completing any statutory filings or similar formalities under the Consolidated FDI Policy, FEMA and other laws in force in India as of the Listing Date i.e. October 19, 2012, required to be undertaken by the Indemnified Parties in relation to the acquisition by RHT or FGHIPL of the equity shares of the Hospital Services Companies.

The Company''s obligations under this indemnity shall continue so long as the Company or the Group holds 15.0% or more of the total units from time to time issued in RHT or three years from the Listing Date, whichever is later.

However, the Company will be liable in respect of the indemnity for a maximum period of five years from the Listing Date.

ii) The Company has also undertaken to indemnify ("Tax Indemnity") each of the Hospital Services Companies and their respective directors, officers, employees and agents (the "Investing Parties") against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies.

iii) Further, as per terms of the various Agreements entered into between Hospital Services Companies and Fortis Operating companies, the Hospital Services Companies have right to recover certain statutory dues levied on them from Fortis Operating Companies. There is a possible present obligation on Hospital Services Companies to collect certain statutory dues from the Fortis Operating Companies and pay it to the relevant authorities. In view of uncertainty arising from interpretation of the regulations, management believes that value of such statutory dues cannot be measured reliably and therefore has not been considered in these financial statements.

10. On January, 9 2012, FHML entered into Share Purchase Agreement with the company to acquire its 49% interest in FHTL at an aggregate consideration of Rs. 37,728.39 lacs. FHTL is the owner of Shalimar Bagh Clinical Establishment and Gurgaon Clinical Establishment. FHML on September 17, 2012 entered into Shareholders'' Agreement with the Company, pursuant to which FHML has a call option over the Company''s 51% interest in FHTL ("FHTL Call Option") at a fixed price, subject to fulfillment of certain conditions, applicable laws including, and receipt of necessary approvals from all third parties. FHML also has the right to appoint 50% of the directors of FHTL, including the chairman of the board of directors who will have the casting vote in case of deadlock on any matter, including all financial and operating policies of the Company, brought to the board of directors for its approval. Additionally, the Company has assigned its right to receive dividends from FHTL in favour of FHML. In addition, FHML has a put option on its 49% interest in FHTL ("FHTL Put Option"), exercisable if FHML is unable to acquire 100% of the issued and paid-up share capital FHTL within 5 years from the date of transfer of the 49% shareholding of FHTL by the Company to FHML, for any reason outside the control of FHML. The put option shall be exercised at a price that is equal to the fair market value of Put Securities on the date of exercise of put option, determined on a discounted cash flow basis.

11. During the year ended March 31, 2013, Escorts Heart Institute and Research Centre Limited (''EHIRCL'') have issued 401,769 Compulsorily Convertible Preference Shares (''CCPS'') of face value of Rs. 10 each at a premium of Rs. 7,456.98 per CCPS to Kanishka Healthcare Limited (''KHL'') with a maturity period of 15 years aggregating to Rs. 30,000 lacs. Following are the key terms of CCPS:-

a) CCPS Put Option - KHL is entitled to exercise an unconditional and irrevocable right to require the Company or its nominee to buy all of CCPS upon occurrence of KHL having exercised FHTL Put Option or FHTL Call Option under shareholders agreement entered between the Company, FHTL and FHML, as per above.

b) Under FHTL call Option the Company is required to pay sum equal to the fair valuation of Equity Shares of EHIRCL as per DCF Method.

c) In case of FHTL put option Company has right to purchase, subject to due compliance with law, all CCPS at consideration equal to KHL''s contribution along with coupon rate agreed.

12. During the year ended March 31, 2011, the Company had issued 1,000 5% Foreign Currency Convertible Bonds of US Dollar 100,000 each aggregating to US Dollar 100,000,000 due 2015 (the "Bonds"). These Bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange. The Bonds are convertible at the option of the holder at any time on or after May 18, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to May 11, 2015 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs. 167 with 26,922.1557 shares being issued per Bond with a fixed rate of exchange on conversion of Rs. 44.96 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be redeemed, in whole but not in part, at the option of the Company at any time on or after 18 May 2013 (subject to the Company having given at least 30 days'' notice) at 100 percent of their aggregate principal amount plus accrued but unpaid interest if the closing price of the Shares on each trading day with respect to the shares for a period of at least 30 consecutive such trading days is equal to or greater than 130 per cent of the Accreted Conversion Price (as defined in the terms and conditions of the Bonds).

The Bonds may also be redeemed in whole, but not in part, at the option of the Company subject to satisfaction of certain conditions including obtaining Reserve Bank of India ("RBI") approval, at certain early redemption amount, as specified, on the date fixed for redemption in the event of certain changes relating to taxation in India.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on May 18, 2015 at 103.1681 per cent of its principal amount. Management has reassessed the probability for conversion of bonds into equity and is of the opinion that it is unlikely that conversion option will be availed by the bondholders. On account of the same, the Company has utilized Securities premium account and provided for the proportionate premium on redemption for the period up to March 31, 2015 amounting to Rs. 1,922.85 lacs (Previous year Rs. 1,472.10 lacs). These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2015 considered for restatement of the Bonds at the year end was Rs. 62.33553= US Dollar 1 (Rs. 60.059349= US Dollar 1 at March 31, 2014).

Subsequent to the end of current year, the Bonds have been fully redeemed on the due date as per aforesaid terms.

13. During the year ended March 31, 2014, the Company issued 150 Foreign Currency Convertible Bonds aggregating to US Dollar 30,000,000 due 2018 (the "Bonds") at the rate of (4.66% LIBOR). These Bonds are listed on the Singapore Exchange Securities Trading Limited (the "SGX-ST").

The Bonds are convertible upto US Dollar 24,000,000 of principal amount at the option of the holder at any time on or after September 17, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to August 01, 2018 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs. 99.09 with 1,204.71 shares being issued per Bond with a fixed rate of exchange on conversion of Rs. 59.6875 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

Subject to certain conditions, the Bonds may be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond outstanding (but in no event exceeding US Dollar 6,000,000 in aggregate principal amount of Bonds), at the option of the Company at any time on or after September 17, 2013 up to August 01, 2018 at the Partial Reset Conversion Price (as defined in the "Terms & Conditions of the Bonds").

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on August 08, 2018 at 100 per cent of its principal amount. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

The Company has incurred expenses of Rs. 542.62 lacs (including Rs. 24.72 lacs paid to Auditors) in connection with this issue.

The proceeds of the issue amounting to Rs. 18,390.74 lacs have been used for repayment of debts.

Exchange Rate at March 31, 2015 considered for restatement of the Bonds at the year end was Rs. 62.33553= US Dollar 1 (Rs. 60.059349= US Dollar 1 at March 31, 2014).

14. During the year ended March 31, 2014, the Company issued 550 Foreign Currency Convertible Bonds of US Dollar 100,000 each aggregating to US Dollar 55,000,000 due 2018 (the "Bonds") at the rate of LIBOR 4.86%. The Bonds are convertible at the option of International Finance Corporation ("IFC"), an international organization established by Articles of Agreement among its member countries including the Republic of India (the holder) giving 7 days notice to the Company at any time on or after June 07, 2013 up to June 08, 2018 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs.99.09 and number of shares to be issued will be calculated on conversion on the basis of applicable rate of exchange of US Dollar and '' on conversion date. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may be converted on the request of the holder but not less than value of US Dollar 5,000,000 or in multiple of US Dollar 1,000,000 thereafter. Except in certain condition mentioned in the "Terms & Conditions of the Bonds" the holder cannot exercise the Conversion Option in part or in full in respect of twenty per cent (20%) of the original bond value for a period of three (3) years after the Subscription Date.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond at the option of the Company at any time on or after June 07, 2013 at Modified Conversion Price (as defined in the "Terms & Conditions of the Bonds").

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on June 08, 2018 at 100 per cent of its principal amount. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2015 considered for restatement of the Bonds at the year end was Rs. 62.33553= US Dollar 1 (Rs. 60.059349= US Dollar 1 at March 31, 2014).

15. During the year ended March 31, 2013, the Company initiated an institutional placement programme (IPP) for issuance of equity share of the Company. The issue was authorised by the Board of Directors through circular resolutions dated November 27, 2012 and by the Company''s shareholders through a special resolution passed by way of postal ballot the result whereof was announced on January 15, 2013.

16. During the year ended March 31, 2014, the Board of Directors of the Company, through its resolution dated April 24, 2013, authorised the issuance of up to 28,610,355 Equity Shares to International Finance Corporation through a preferential allotment. Subsequently, on June 6, 2013, the Company issued and allotted 18,833,700 equity shares to International Finance Corporation at Rs. 99.09 per share including premium of Rs. 89.09 per share aggregating to Rs. 18,662.31 lacs.

17. During the year ended March 31, 2014, the shareholders of the Company, through its special resolution dated August 22, 2013, authorized the issuance of 3,737,449 Equity shares to Standard Chartered Private Equity (Mauritius) III Limited through a preferential allotment. Subsequently, on September 5, 2013, the Company issued and allotted 3,737,449 equity shares to Standard Chartered Private Equity (Mauritius) III Limited at Rs. 99.09 per share including premium of Rs. 89.09 per share aggregating to Rs. 3,703.44 lacs.

18. Details of dues to Micro and Small Enterprises as per MSMED Act, 2006

During the period ended December 31, 2006, Government of India has promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 which comes into force with effect from October 2, 2006. As per the Act, the Company is required to identify the Micro, Small and Medium suppliers and pay them interest on overdue beyond the specified period irrespective of the terms agreed with the suppliers. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements.

19. Previous Year Figures

Previous year figures have been regrouped / reclassified, where necessary, to conform to this year''s classification.

Mar 31, 2014

1. Nature of Operations

Fortis Healthcare Limited (the ''Company'' or ''FHL'') was incorporated in the year 1996 and commenced its hospital operations in the year 2001. As part of its business activities, the Company holds interests in its subsidiaries, joint ventures and associate companies through which it manages and operates a network of multi-specialty hospitals. The Company''s equity shares are listed on both Bombay Stock Exchange and National Stock Exchange. The Company''s foreign currency convertible bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange and 4.66% LIBOR foreign currency convertible bonds are listed on the Singapore Exchange Securities Trading Limited (the "SGX-ST").

2. Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

3. Related party disclosures

Names of related parties and related party relationship

Ultimate Holding Company

RHC Holding Private Limited (Holding Company of Fortis Healthcare Holdings Private Limited)

Holding Company

Fortis Healthcare Holdings Private Limited (''FHHPL'')

Subsidiary Companies - direct or indirect through investment in subsidiaries

1 Fortis Hospotel Limited (''FHTL'') (refer note 16)

2 Hiranandani Healthcare Private Limited (''HHPL'')

3 Fortis Health Management (West) Limited (''FHMWL'')

4 Fortis Health Management (North) Limited (''FHMNL'')*****

5 Fortis C-Doc Healthcare Limited (''C-Doc'')

6 Fortis Health Management (East) Limited (''FHMEL'')

7 SRL Limited (''SRL'')

8 SRL Diagnostics Private Limited (''SRLDPL'')

9 Fortis Healthcare International Limited (''FHIL'')

10 Fortis Global Healthcare (Mauritius) Limited (''FGHML'')

11 Fortis Hospitals Limited (''FHsL'')

12 Fortis Health Management (South) Limited (''FHMSL'')

13 Lalitha Healthcare Private Limited (''LHPL'')

14 Fortis Malar Hospitals Limited (''FMHL'')

15 Malar Stars Medicare Limited (''MSML'')

16 Escorts Heart Institute And Research Centre Limited (''EHIRCL'')

17 Fortis HealthStaff Limited (''FHSL'')

18 Fortis Asia Healthcare Pte Limited (''FAHPL'')

19 Fortis Healthcare International Pte Limited (''FHIPL'')

20 Fortis Healthcare Australia Pty Ltd (''FHAPL'')

21 Dental Corporation Holdings Limited (''DCHL'') (up to May 31, 2013)**

22 Dental Corporation Pty Limited (''DCPL'') (up to May 31, 2013)**

23 Dental Corporation Petrie Pty Ltd (up to May 31, 2013)**

24 Dental Corporation Levas Pty Ltd (up to May 31, 2013)**

25 D C Holdings WA Pty Ltd (up to May 31, 2013)**

26 Dental Care Network Pty Limited (up to May 31, 2013)**

27 Dental Corporation (NZ) Limited (up to May 31, 2013)**

28 Dental Corporation Cox Pty Ltd (up to May 31, 2013)**

29 Hazel Ridge Pty Limited (up to May 31, 2013)**

30 John M Levas Pty Limited (up to May 31, 2013)**

31 Scott Petrie Dental Pty Ltd (up to May 31, 2013)**

32 Larry Benge Pty Ltd (up to May 31, 2013)**

33 Dr Chris Hardwicke Pty Ltd (up to May 31, 2013)**

34 Fortis Healthcare Singapore Pte Ltd (''FHSPL'')

35 Radlink Asia Pte Limited (Radlink) (''RADLINK'')

36 Radlink Medicare Pte Limited (''RMPL'')

37 DRS Thompson & Thomson (Radlink Medicare) Pte Limited

38 Radlink Medicare (Bishan) Pte Limited

39 Radlink Medicare (Woodlands) Pte Limited

40 Radlink Medicare (Tampines) Pte Limited

41 Radlink Medicare (Jurong East) Pte Limited

42 Clinic 1866 Pte Limited

43 Radlink Diagnostic Imaging (S) Pte Limited (''RDISPL'')

44 Drs Lim Hoe & Wong Radiology Pte limited

45 Healthcare Diagnostic Services Pte Limited

46 Radlink Women & Fetal Imaging Centre Pte Limited

47 Radlink Pet & Cardiac Imaging Centre Pte Limited (''RADLINK PET)

48 Singapore Radiopharmaceuticals Pte Limited

49 Sinagpore Molecular Therapy Centre Pte Limited

50 Altai Investments Limited (ALTAI) (up to October 24, 2013)****

51 Quality HealthCare Limited (''QHL'') (up to October 24, 2013)****

52 Quality HealthCare Hong Kong Limited (up to October 24, 2013)****

53 Green Apple Associates Limited (up to October 24, 2013)****

54 Quality HealthCare Medical Services Limited (up to October 24, 2013)****

55 Fortis HealthCare Hong Kong Limited (''Fortis Honkong) (up to October 24, 2013)****

56 Quality Healthcare Medical Services (Macau) Limited (up to October 24, 2013)****

57 Quality HealthCare Chinese Medicine Limited (''QHCML'') (up to October 24, 2013)****

58 Marvellous Way Limited (up to October 24, 2013)****

59 Universal Lane Limited (''ULL'') (up to October 24, 2013)****

60 DB Health Services Limited (up to October 24, 2013)****

61 Quality HealthCare Medical Centre Limited (up to October

24, 2013)****

62 Quality HealthCare Professional Services Limited (up to October 24, 2013)****

63 SmartLab Limited (up to October 24, 2013)****

64 GlobalRx Limited (up to October 24, 2013)****

65 Allied Medical Practices Guild Limited (up to October 24, 2013)****

66 Fortis Hospitals Hong Kong Limited (up to October 24,

2013)****

67 Normandy (Hong Kong) Limited (''NHKL'') (up to October 24, 2013)****

68 Great Option Limited (Hong Kong) (up to October 24, 2013)****

69 Healthcare Opportunities Limited (''HOL'') (up to October 24, 2013)****

70 TCM Products Limited (''TCM'') (up to October 24, 2013)****

71 GHC Holdings Limited (''GHC'') (up to October 24, 2013)****

72 Case Specialist Limited (up to October 24, 2013)****

73 Jadeast Limited (up to October 24, 2013)****

74 Jadefairs International Limited (up to October 24, 2013)****

75 Jadway International Limited (up to October 24, 2013)****

76 Megafaith International Limited (up to October 24, 2013)****

77 Jadison Investment Limited (up to October 24, 2013)****

78 Berkshire Group Limited (up to October 24, 2013)****

79 Central Medical Diagnostic Centre Limited (''CMDCL'') (up to October 24, 2013)****

80 Central MRI Centre Limited (up to October 24, 2013)****

81 Central Medical Laboratory Limited (up to October 24,

2013)****

82 Central PET/CT Scan Limited (up to October 24, 2013)****

83 Portex Limited (up to October 24, 2013)****

84 Quality HealthCare Services Limited (''QHCSL'') (up to October 24, 2013)****

85 Quality HealthCare Psycological Services Limited (''QHCPSL'') (up to October 24, 2013)****

86 Quality EAP (Macau) Limited (up to October 24, 2013)****

87 Quality HealthCare Dental Services Ltd (up to October 24,

2013)****

88 Quality HealthCare Physiotherapy Services Limited (up to October 24, 2013)****

89 Quality HealthCare Nursing Agency Limited (up to October 24, 2013)****

90 Dynamic People Group Limited (up to October 24, 2013)****

91 Mena Healthcare Investment Company Limited (''MHICL'')

92 Super Religare Laboratories International FZ LLC

93 Swindon Limited (SL) (up to August 20, 2013)***

94 VOF PE Holdings 2 Limited (''VOFPEHL'') (up to August 20, 2013)***

95 Fortis Hoan My Medical Corporation (''HOAN'') (up to August 20, 2013)***

96 Fortis Hoan My Saigon General Hospital Joint Stock Company (''MY SAIGON'') (up to August 20, 2013)***

97 Hoan My Clinic Co. Ltd (up to August 20, 2013)***

98 Hoan My Da Nang General Hospital Joint Stock Company (up to August 20, 2013)***

99 Hue Hoan My General Hospital Joint Stock Company (up to August 20, 2013)***

100 Hoan My Cuu Long General Hospital Joint Stock Company (up to August 20, 2013)***

101 Hoan My Da Lat General Hospital Joint Stock Company (up to August 20, 2013)***

102 Fortis Healthcare Vietnam Company Limited (up to August 20, 2013)***

103 Medical Management Company Limited

104 Religare Health Trust (RHT)* (up to October 19, 2012)

105 International Hospital Limited (IHL)* (up to October 19, 2012)

106 Escorts Heart and Super Speciality Institute Limited (EHSSIL)* (up to October 19, 2012)

107 Escorts Hospital and Research Centre Limited (EHRCL)* (up to October 19, 2012)

108 Escorts Heart and Super Speciality Hospital Limited (EHSSHL)* (up to October 19, 2012)

109 Kanishka Healthcare Limited (KHL)* (up to October 19, 2012)

110 Fortis Global Healthcare Infrastructure Pte. Limited (FGHIPL)* (up to October 19, 2012)

111 Hospitalia Eastern Private Limited (HEPL)* (up to October 19, 2012)

112 Fortis Healthcare Middle East LLC

113 Healthcare Clinic and Surgery Pte. Limited

Companies (5) and (6) of above are subsidiaries of FHsL; Company (8) of above is subsidiary of SRL; Company (10) of above is a subsidiary of FHIL; Companies (12) and (14) of above are subsidiaries of FHsL; Company (13) of above is subsidiary of FHMSL; Company (15) above is a subsidiary of FMHL; Companies (17) and (18) are subsidiaries of EHIRCL; Company (19) of above is subsidiary of FAHPL; Company (20), (34), (50), (91), (92), (93), (94), (102) and (112) of above are subsidiaries of FHIPL; Company (21) of above is subsidiary of FHAPL; Company (22) of above is subsidiary of DCHL; Companies (23) to (33) of above are subsidiaries of DCPL; Company (35) of above is subsidiary of FHSPL; Companies (36) and (43) of above are subsidiaries of RADLINK; Companies (37) to (42) of above are subsidiaries of RMPL; Companies (44) to (47) of above are subsidiaries of RDISPL; Companies (48) and (49) of above are subsidiaries of RADLINK PET; Companies (51), (54), (55), (83) and (84) of above are subsidiaries of ALTAI; Companies (52) and (53) are subsidiaries of QHL; Companies (56), (57), (59), (61) to (67), (69), (78) and (79) are subsidiaries of FORTIS HONKONG; Company (58) of above is subsidiary of QHCML; Company (60) of above is subsidiary of ULL; Company (68) of above is subsidiary of NHKL; Company (70) of above is subsidiary of HOL; Company (71) of above is subsidiary of TCM; Companies (72) to (77) of above are subsidiaries of GHC; Companies (80) to (82) are subsidiaries of CMDCL; Companies (85) and (87) to (90) are subsidiaries of QHCSL; Company (86) of above is subsidiary of QHCPSL; Company (97) of above is subsidiary of VOFPEHL; Companies (96), (98), (100) and (101) are subsidiaries of HOAN; Company (97) of above is subsidiary of My SAIGON; Company (103) of above is subsidiary of MHICL; Company (99) of above is a subsidiary of Company (98).

Fellow Subsidiary (with whom transactions have been taken place)

Religare Wellness Limited

Associates

a) Sunrise Medicare Private Limited

b) Fortis Hospital Management Limited

c) Medical and Surgical Centre Limited, Mauritius (Associate of Fortis Healthcare International Limited)

d) Religare Health Trust (RHT)* (Associate of Fortis Healthcare International Limited)

e) Fortis Medicare International Limited (Associate of Fortis Healthcare International Limited)

f) Lanka Hospitals Corporation PLC (Associate of Fortis Healthcare International Pte. Limited)

g) Town Hall Clinic (Associate of Fortis Healthcare Singapore Pte. Limited)

h) Hoan My Minh Hai General Hospital Joint Stock Company (Associate of SL and VOFPEHL) (up to August 20, 2013)***

i) Hoan My Orb Corporation (Associate of SL and

VOFPEHL) (up to August 20, 2013)*** j) International Hospital Limited (IHL)*

k) Escorts Heart and Super Speciality Institute Limited

(EHSSIL)* l) Escorts Hospital and Research Centre Limited (EHRCL)*

m) Escorts Heart and Super Speciality Hospital Limited (EHSSHL)*

n) Kanishka Healthcare Limited (KHL)* o) Fortis Global Healthcare Infrastructure Pte. Limited (FGHIPL)*

p) Hospitalia Eastern Private Limited (HEPL)* r) Fortis Emergency Services Limited

Joint Ventures

a) Super Religare Reference Laboratories (Nepal) Private Limited (Joint venture of SRL)

b) DDRC SRL Diagnostics Services Private Limited (Joint venture of SRLDPL)

c) Fortis Cauvery, Partnership firm (Joint venture of FHMSL)

Key Management Personnel (''KMP'')

Mr. Malvinder Mohan Singh Â Executive Chairman

Mr. Shivinder Mohan Singh - Executive Vice Chairman

Mr. Balinder Singh Dhillon - Executive Director (up to February 11, 2014)

Enterprises owned or significantly influenced by key management personnel or their relatives

a) Religare Capital Market Plc.

b) Fortis Nursing and Education Society

c) Ligare Travels Limited

d) Religare Technova IT Services Limited

e) Oscar Investments Limited

f) Ligare Aviation Limited (Formerly "Religare Aviation Limited")

g) Malav Holdings Limited h) Shivi Holdings Limited

i) Religare Voyages Business Services Pvt Limited

j) Religare Technologies Limited

k) Religare Capital Market Limited

4 Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises and few medical equipments are obtained on operating lease. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. For all cases, there are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. The total lease payments in respect of such leases recognised in the statement of profit and loss for the year are Rs. 2,670.62 lacs (Previous year Rs. 1,737.93 lacs) and capitalized during the year are Rs. 1,341.99 lacs (Previous year Rs. 1,345.44 lacs).

(b) Assets given on Operating Lease

i) The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. There are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. All these leases are cancellable in nature. The total lease income received / receivable in respect of the above leases recognised in the statement of profit and loss for the year are Rs. 116.76 lacs (Previous year Rs. 105.45 lacs).

5. Long term borrowings (i) Secured Loans

Term Loan from L&T Infrastructure Finance Company Limited ("lender") was taken in financial year 2011-2012 and is secured by a first pari passu charge by way of mortgage of the Company''s immovable properties, present and future. Further secured by a first pari passu charge by way of hypothecation of the Company''s movable assets, including movable machinery, machinery spares, tools and accessories, present and future. Also, secured by a second pari passu charge by way of hypothecation on the Company''s book debts, operating cash flows and the receivables and revenues, current assets commissions and revenues of whatsoever nature and wherever arising, both present and future. Further, there is an exclusive pledge of shareholding of the Company in SRL Limited in favour of the lender, to the extent of at least 2 times of the facility amount, to be maintained at all times during the subsistence of the facility. The rate of interest for each tranche of facility shall be Prime Lending rate less 3.75% per annum, payable monthly. On July 31, 2013 Lender assigned Rs. 10,000 lacs to L&T Fincorp Limited out of outstanding amount of Rs. 16,683.33 lacs as on that date. The loan is repayable in 84 structured monthly instalments, after a moratorium of 12 months from the date of first disbursement to the Company. As at March 31, 2014, Rs. 6,192.60 lacs (Previous year Rs. 17,033.33 lacs) is payable to L&T Infrastructure Finance Company Limited and Rs. 9,265.73 lacs (Previous year Rs. Nil) is payable to L&T Fincorp Limited.

Further, another facility is taken from Siemens financial services for Oracle licences. The Loan is repayable in 8 quarterly payments starting from August 2013 and will end on March 2015.

6. Short term borrowings

a) 10% Redeemable Non Convertible Debentures were issued on September 24, 2012 redeemable at par, at the end of one year from the date of allotment. The debentures were secured by way of first pari passu charge over the free hold land of the Company located in State of Gujarat in favour of Debenture trustee. The debentures were redeemed on October 29, 2013.

b) Overdraft limit of Rs. 1,000 lacs is secured by way of first pari passu charge over moveable fixed assets at Mohali hospital. Further, secured by first pari passu charge over stocks and book debts and carry interest rate ranging from 12.50% to 13.00% per annum.

7. Commitments:

(b) Going concern support in form of funding and operational support letters issued by the Company in favour of FHMWL, FHMSL, Fortis C-Doc Healthcare Limited, FHMEL, LHPL, HHPL, Fortis Cauvery, FAHPL, FHIL & FGHML.

(c) For commitments relating to lease arrangements, refer note 6.

8. Contingent liabilities (not provided for) in respect of:

(Rs. in lacs)

Particulars As at As at March 31, 2014 March 31, 2013

Claims against the Company not acknowledged as debts (in respect 796.68 471.18 of compensation demanded by the patients / their relatives for negligence). The cases are pending with various Consumer Disputes Redressal Commissions. Based on expert opinion obtained, the management believes that the Company has good chance of success in these cases

The Company is under litigation with the Income Tax Department 579.02 501.41 against certain income tax demands on account of deduction of tax under section 194J of Income Tax Act, 1961 instead of section 192 on payments made to retainer doctors, u/s 201(1)/201(1A) for the assessment years 2010-11, 2011-12 and 2012-13, thereby raising demands of Rs. 239.92 lacs (Previous year Rs. 239.92 lacs), Rs. 261.49 lacs (Previous year Rs. 261.49 lacs) and Rs. 77.61 lacs (Previous year Rs. Nil) respectively. Company has filed appeals with the Commissioner of Income Tax (Appeals), Chandigarh which is pending for disposal.

Based on expert opinion obtained, the management believes that the Company has good chance of success in this case.

The Excise & Taxation Commissioner cum Designated Officer- 1,412.35 - Mohali had passed an assessment order dated October 08, 2013 under Punjab Value Added Tax Act, 2005 (''PVAT'') thereby raising a demand of Rs. 1,412.35 lacs (Previous year Rs. Nil) [including penalty Rs. 741.39 lacs (Previous year Rs. Nil) and interest of Rs. 300.26 lacs (Previous year Rs. Nil)] holding that the assessee was liable to pay tax on the medical consumables used on in-patients and out- patients and has contravened the provisions of Section 29(2) of PVAT. Company is in appeal before the Hon''ble High Court of Punjab and Haryana against the aforesaid order of Deputy Excise & Taxation Commissioner. Hon''ble High Court admitted appeal filed by the Company and further, granted stays on assessment order vide its order dated January 15, 2014. Based on expert opinion obtained and the favourable decision of the Allahabad High Court in the case of an associate company in similar matter, the management believes that the Company has good chance of success in this case.

The Commissioner of Service-tax, Chandigarh has passed an 215.34 - Order dated March 14, 2014 under Finance Act, 1994 alleging the assessee is liable to pay service -tax on support services of business or commerce provided to doctors, thereby raising demand of Rs. 215.34 lacs (Previous year Rs. Nil). The Company is planning to file an appeal before appellate authorities. Based on expert opinion obtained, the management believes that the Company has good chance of success in this case.

Premium on redemption of US$ 100 Million 5% Foreign Currency - 986.62 Convertible Bonds due 2015 (Refer note 18 below).

Corporate guarantee given to financial institutions/ banks in respect of financial assistance availed by subsidiaries and associates of the Company. None of the corporate guarantee have been evoked by the Banks/ Financial institutions during the year as the subsidiaries and associates of the Company have complied with the loan covenants.

9. Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/its subsidiaries. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan ''A''. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 (Grant III) during the year ended March 31, 2010, 1,302,250 options (Grant IV) were granted during the year ended March 31, 2011 and 200,000 options (Grant V) were granted during the year ended March 31, 2012. During the previous year 4,050,000 options (Grant VI) were granted under Plan ''B''. Further during the current year 3,715,000 options (Grant VII) were granted under Plan ''B''. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company. The weighted average share price of the Company during the year was Rs. 100.25 (Previous year Rs. 101.52). As at March 31, 2014, the following scheme was in operation:

Expected volatility has been determined considering the daily volatility of the stock prices on National Stock Exchange, over a period prior to the date of grant, corresponding with the expected life of the options.

The fair value of total option outstanding at the year end is Rs. 2,187.19 lacs (Previous year Rs. 1,547.03 lacs) and these shall vest over a period of 3-5 years. Accordingly, the charge for the current year in relation to employee stock compensation on a straight line basis under fair value method would have been Rs. 627.37 lacs (Previous year Rs. 412.17 lacs).

10. Disclosures under Accounting Standard - 15 (Revised) on ''Employee Benefits'':

Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The following table summarizes the components of net benefit expenses recognised in the statement of profit and loss and the amounts recognized in the balance sheet.

11. The Company has entered into ''Operation and Management'' ag reement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

12. Restructuring

The Group had completed following restructuring during the previous year:- a. The Group''s primary business consists of provision of Hospital Services through various entities. The Company initiated internal restructuring within the Group with a view to streamline and focus Group companies'' resources and energies on different divisions and undertakings and to align the business with the internationally emerging trends by moving towards innovative and cost effective methods such as transformation to asset light models. Subsequent to the internal restructuring completed during the year, the business of certain identified hospitals of the Group are being divided into the following two verticals, such that they are managed under different verticals whilst continuing to have mutual interdependencies:

(i) One vertical (the "Clinical Establishments Division") will own, maintain and operate clinical establishments (being fully air conditioned institutions established, and specifically customized and duly fitted with all fixtures, fittings, certain medical equipment and infrastructure required for running and operating the hospitals), along with providing services under outpatient division and radio-diagnostic services (hereinafter referred to as the "Clinical Establishment Services").

(ii) The other vertical (the "Medical Services Division") will undertake the business of running the hospital operations, being hereinafter referred to as provision of medical services, including in- patient services and emergency services ("Medical Services").

b. Religare Health Trust (RHT) made an offering of 567,455,000 common units at S$ 0.90 per common unit. Post listing of RHT on SGX-ST on October 19, 2012, Group''s shareholding in RHT has been diluted from 100% to 28%.

13. As part of Sponsor Agreement entered between The Trustee-Manager of RHT, FGHIPL and Hospital Service Companies (collectively referred as ''Indemnified parties'') with the Company, the Company has provided following indemnities:- i) To RHT and its, directors, officers, employees and agents under the relevant transaction agreements against any losses or liabilities finally determined as payable for any breach of the Consolidated Foreign Direct Investment (FDI) Policy or Foreign Exchange Management Act (''FEMA''), to the extent that such breach has resulted from the acquisition by RHT of the Hospital Services Companies.

Further, the Company has undertaken to transfer or procure additional medical and healthcare services to Hospital Services Companies in the event that any regulatory authority raises concerns over compliance with any applicable law.

However, the Company will not be liable to indemnify the Indemnified Parties for any losses resulting from delay or failure of the Indemnified Parties in completing any statutory filings or similar formalities under the Consolidated FDI Policy, FEMA and other laws in force in India as of the Listing Date i.e. October 19, 2012, required to be undertaken by the Indemnified Parties in relation to the acquisition by RHT or FGHIPL of the equity shares of the Hospital Services Companies.

The Company''s obligations under this indemnity shall continue so long as the Company or the Group holds 15.0% or more of the total units from time to time issued in RHT or three years from the Listing Date, whichever is later.

However, the Company will be liable in respect of the indemnity for a maximum period of five years from the Listing Date.

ii) The Company has also undertaken to indemnify ("Tax Indemnity") each of the Hospital Services Companies and their respective directors, officers, employees and agents (the "Investing Parties") against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies.

iii) Further, as per terms of the various Agreements entered into between Hospital Services Companies and Fortis Operating companies, the Hospital Services Companies have right to recover certain statutory dues levied on them from Fortis Operating Companies. There is a possible present obligation on Hospital Services Companies to collect certain statutory dues from the Fortis Operating Companies and pay it to the relevant authorities. In view of uncertainty arising from interpretation of the regulations, management believes that value of such statutory dues cannot be measured reliably and therefore has not been considered in these financial statements.

14. On January, 9 2012, FHML entered into Share Purchase Agreement to acquire 49% interest in FHTL at an aggregate consideration of Rs. 37,728.39 lacs. FHTL is the owner of Shalimar Bagh Clinical Establishment and Gurgaon Clinical Establishment. FHML on September 17, 2012 entered into Shareholders'' Agreement with the Company, pursuant to which FHML has a call option over the Company''s 51% interest in FHTL ("FHTL Call Option") at a fixed price, subject to fulfillment of certain conditions, applicable laws including, and receipt of necessary approvals from all third parties. FHML also has the right to appoint 50% of the directors of FHTL, including the chairman of the board of directors who will have the casting vote in case of deadlock on any matter, including all financial and operating policies of the Company, brought to the board of directors for its approval. Additionally, the Company has assigned its right to receive dividends from FHTL in favour of FHML. In addition, FHML has a put option on its 49% interest in FHTL ("FHTL Put Option"), exercisable if FHML is unable to acquire 100% of the issued and paid-up share capital of FHTL within 5 years from the date of transfer of the 49% shareholding of FHTL by the Company to FHML, for any reason outside the control of FHML. The put option shall be exercised at a price that is equal to the fair market value of Put Securities on the date of exercise of put option, determined on a discounted cash flow basis.

15. During the year ended March 31, 2013, Escorts Heart Institute and Research Centre Limited (''EHIRCL'') have issued 401,769 Compulsorily Convertible Preference Shares (''CCPS'') of face value of Rs.10 each at a premium of Rs. 7,456.98 per CCPS to Kanishka Healthcare Limited (''KHL'') with a maturity period of 15 years aggregating to Rs. 30,000 lacs. Following are the key terms of CCPS:- a) CCPS Put Option Â KHL is entitled to exercise an unconditional and irrevocable right to require the Company or its nominee to buy all of CCPS upon occurrence of KHL having exercised FHTL Put Option or FHTL Call Option under shareholders agreement entered between the Company, FHTL and FHML, as per above.

b) Under FHTL call Option the Company is required to pay sum equal to the fair valuation of Equity Shares of EHIRCL as per DCF Method.

c) In case of FHTL put option Company has right to purchase, subject to due compliance with law, all CCPS at consideration equal to KHL''s contribution along with coupon rate agreed.

16. During the year ended March 31, 2011, the Company had issued 1,000 5% Foreign Currency Convertible Bonds of US Dollar 100,000 each aggregating to US Dollar 100,000,000 due 2015 (the "Bonds"). These Bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange. The Bonds are convertible at the option of the holder at any time on or after May 18, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to May 11, 2015 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs. 167 with 26,922.1557 shares being issued per Bond with a fixed rate of exchange on conversion of Rs. 44.96 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be redeemed, in whole but not in part, at the option of the Company at any time on or after 18 May 2013 (subject to the Company having given at least 30 days'' notice) at 100 percent of their aggregate principal amount plus accrued but unpaid interest if the closing price of the Shares on each trading day with respect to the shares for a period of at least 30 consecutive such trading days is equal to or greater than 130 per cent of the Accreted Conversion Price (as defined in the terms and conditions of the Bonds).

The Bonds may also be redeemed in whole, but not in part, at the option of the Company subject to satisfaction of certain conditions including obtaining Reserve Bank of India ("RBI") approval, at certain early redemption amount, as specified, on the date fixed for redemption in the event of certain changes relating to taxation in India.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on May 18, 2015 at 103.1681 per cent of its principal amount. Management has reassessed the probability for conversion of bonds into equity and is of the opinion that it is unlikely that conversion option will be availed by the bondholders. On account of the same, the Company has utilized Securities premium account and provided for the proportionate premium on redemption for the period up to March 31, 2014 amounting to Rs. 1,472.10 lacs. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2014 considered for restatement of the Bonds at the year end was Rs. 60.059349= US Dollar 1 (Rs. 54.285 = US Dollar 1 at March 31, 2013).

17. During the current year, the Company issued 150 Foreign Currency Convertible Bonds aggregating to US Dollar 30,000,000 due 2018 (the "Bonds") at the rate of (4.66% LIBOR). These Bonds are listed on the Singapore Exchange Securities Trading Limited (the "SGX-ST").

The Bonds are convertible upto US Dollar 24,000,000 of principal amount at the option of the holder at any time on or after September 17, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to August 01, 2018 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs. 99.09 with 1,204.71 shares being issued per Bond with a fixed rate of exchange on conversion of Rs. 59.6875 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

Subject to certain conditions, the Bonds may be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond outstanding (but in no event exceeding US Dollar 6,000,000 in aggregate principal amount of Bonds), at the option of the Company at any time on or after September 17, 2013 up to August 01, 2018 at the Partial Reset Conversion Price (as defined in the "Terms & Conditions of the Bonds").

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on August 08, 2018 at 100 per cent of its principal amount. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

The Company has incurred expenses of Rs. 542.62 lacs (including Rs. 24.72 lacs paid to Auditors) in connection with this issue.

The proceeds of the issue amounting to Rs. 18,390.74 lacs have been used for repayment of debts.

Exchange Rate at March 31, 2014 considered for restatement of the Bonds at the year end was Rs. 60.059349= US Dollar 1.

18. During the current year, 2014, the Company issued 550 Foreign Currency Convertible Bonds of US Dollar 100,000 each aggregating to US Dollar 55,000,000 due 2018 (the "Bonds") at the rate of LIBOR 4.86%. The Bonds are convertible at the option of International Finance Corporation ("IFC"), an international organization established by Articles of Agreement among its member countries including the Republic of India (the holder) giving 7 days notice to the Company at any time on or after June 07, 2013 up to June 08, 2018 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs. 99.09 and number of shares to be issued will be calculated on conversion on the basis of applicable rate of exchange of US Dollar and Rs. on conversion date. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may be converted on the request of the holder but not less than value of US Dollar 5,000,000 or in multiple of US Dollar 1,000,000 thereafter. Except in certain condition mentioned in the "Terms & Conditions of the Bonds" the holder cannot exercise the Conversion Option in part or in full in respect of twenty per cent (20%) of the original bond value for a period of three (3) years after the Subscription Date.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be converted mandatorily into fully paid equity shares, 20% of the principal amount of bond at the option of the Company at any time on or after June 07, 2013 at Modified Conversion Price (as defined in the "Terms & Conditions of the Bonds").

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on June 08, 2018 at 100 per cent of its principal amount. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2014 considered for restatement of the Bonds at the year end was Rs. 60.059349= US Dollar 1.

19. During the previous year, the Company initiated an institutional placement programme (IPP) for issuance of equity share of the Company. The issue was authorised by the Board of Directors through circular resolutions dated November 27, 2012 and by the Company''s shareholders through a special resolution passed by way of postal ballot the result whereof was announced on January 15, 2013.

20. During the current year, the Board of Directors of the Company, through its resolution dated April 24, 2013, authorised the issuance of up to 28,610,355 Equity Shares to International Finance Corporation through a preferential allotment. Subsequently, the Company issued and allotted 18,833,700 equity shares to International Finance Corporation at Rs. 99.09 per share including premium of Rs. 89.09 per share aggregating to Rs. 18,662.31 lacs.

21. During the current year, the shareholders of the Company, through its special resolution dated August 22, 2013, authorized the issuance of 3,737,449 Equity shares to Standard Chartered Private Equity (Mauritius) III Limited through a preferential allotment. Subsequently, on September 5, 2013, the Company issued and allotted 3,737,449 equity shares to Standard Chartered Private Equity (Mauritius) III Limited at Rs. 99.09 per share including premium of Rs. 89.09 per share aggregating to Rs. 3,703.44 lacs.

22. Details of dues to Micro and Small Enterprises as per MSMED Act, 2006

During the period ended December 31, 2006, Government of India has promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 which comes into force with effect from October 2, 2006. As per the Act, the Company is required to identify the Micro, Small and Medium suppliers and pay them interest on overdue beyond the specified period irrespective of the terms agreed with the suppliers. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements.

23. During the year, the Company has capitalised the following expenses to the cost of fixed asset/ capital work in progress (CWIP). Consequently, expenses disclosed under the respective notes are net of amount capitalised by the Company.

24. Subsequent events

a) In continuance of Group''s Asset light model, subsequent to year end on May 7, 2014, the Company has entered in to an agreement with Escorts Heart and Super Specialty Hospital Limited ("EHSSHL"), a subsidiary of Religare Health Trust, for transfer of net assets relating to the Mohali Clinical Establishment (in Punjab) to EHSSHL. The transaction has been completed subsequent to the year end and hence no effect has been given in the financial statements for the year ended March 31, 2014.

b) During the current year, the Board of Directors of the Company at its meeting held on March 25, 2014 approved the purchase of operations of Fortis Hospital, Shalimar Bagh from its subsidiary, Fortis Hospitals Limited (''FHsL'') on a going concern basis by way of a slump sale. The Company and FHsL entered into a business transfer agreement (''BTA'') on March 28, 2014 for purchase of operations of Shalimar Bagh for a consideration of Rs. 4,000 lacs. The transaction is effective from April 1, 2014 and hence no effect has been given in the financial statements for the year ended March 31, 2014.

25. Previous Year Figures

Previous year figures have been regrouped / reclassified, where necessary, to conform to this year''s classification.

Mar 31, 2013

1. Nature of Operations

Fortis Healthcare Limited (the ''Company'' or ''FHL'') was incorporated in the year 1996 and commenced its hospital operations in the year 2001 with the flagship of Multi-Specialty Hospital at Mohali and has thereafter set up/ acquired/ taken over the management of other hospitals in different parts of the country. As part of its business activities, the Company holds interests in its subsidiaries, joint ventures and associate companies through which it manages and operates a network of multi-specialty hospitals. The Company''s equity shares are listed on both Bombay Stock Exchange and National Stock Exchange and its Foreign Currency Convertible Bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange.

2. Basis of preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

3. Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises and few medical equipments are obtained on operating lease. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. For all cases, there are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. The total lease payments in respect of such leases recognised in the statement of profit and loss for the year are Rs. 1,185.87 lacs (Previous year Rs. 2,188.73 lacs) and capitalized during the year are Rs. 1,784.40 lacs (Previous year Rs. 694.14 lacs).

(b) Assets given on Operating Lease

i) The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. There are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. All these leases are cancellable in nature. The total lease income received / receivable in respect of the above leases recognised in the statement of profit and loss for the year are Rs. 105.45 lacs (Previous year Rs. 83.92 lacs).

ii) The Company has leased out certain capital assets on operating lease to a Trust managing hospital operations and one of its Associates. The lease term is for 3 years and thereafter renewable at the option of the lessor. There are no restrictions imposed by the lease arrangements and the rent is not determined based on any contingency. There is no escalation clause in the lease agreements. The lease arrangement is non-cancellable in nature. The details of the capital assets given on operating lease are as under:

4. Deferred Tax Asset / (Liability):

The Company has deferred tax liability of Rs. 734.19 lacs (Previous year Rs. 595.56 lacs) and deferred tax assets of Rs. 702.35 lacs (Previous year Rs. 706.63 lacs) as per details below. In accordance with Accounting Standard 22 ''Accounting for Taxes on Income'', as notified under Companies (Accounting Standard) Rules, 2006, in view of the large amount of accumulated losses carried forward at the close of the previous year, deferred tax assets on timing differences have not been recognized for in the books since it is not virtually certain whether the Company will be able to use such losses/depreciation. Accordingly the company has recognised deferred tax asset of Rs. 596.56 lacs in previous year financial statement to set off against the deferred tax liabilities and no deferred tax asset (net of deferred tax liability) was created in the absence of above virtual certainty.

5. Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/its subsidiaries. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan ''A''. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 (Grant III) during the year ended March 31, 2010, 1,302,250 options (Grant IV) were granted during the year ended March 31, 2011 and 200,000 options (Grant V) were granted during the previous year. During the previous year 4,050,000 options (Grant VI) were granted under Plan ''B''. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company. The weighted average share price of the Company during the year was Rs. 101.52 (Previous year Rs. 132.54). As at March 31, 2013, the following scheme was in operation:

6. Disclosures under Accounting Standard - 15 (Revised) on ''Employee Benefits'':

Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The following table summaries the components of net benefit expenses recognised in the statement of profit and loss and the amounts recognized in the balance sheet.

7. The Company has entered into ''Operation and Management'' agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

8. Restructuring during the year

a. The Group''s primary business consists of provision of Hospital Services through various entities. The Company initiated internal restructuring within the Group with a view to streamline and focus Group companies'' resources and energies on different divisions and undertakings and to align the business with the internationally emerging trends by moving towards innovative and cost effective methods such as transformation to asset light models. Subsequent to the internal restructuring completed during the year, the business of certain identified hospitals of the Group are being divided into the following two verticals, such that they are managed under different verticals whilst continuing to have mutual interdependencies:

(i) One vertical (the "Clinical Establishments Division") will own, maintain and operate clinical establishments (being fully air conditioned institutions established, and specifically customized and duly fitted with all fixtures, fittings, certain medical equipment and infrastructure required for running and operating the hospitals), along with providing services under outpatient division and radio-diagnostic services (hereinafter referred to as the "Clinical Establishment Services").

(ii) The other vertical (the "Medical Services Division") will undertake the business of running the hospital operations, being hereinafter referred to as provision of medical services, including in- patient services and emergency services ("Medical Services").

b. Religare Health Trust (RHT) made an offering of 567,455,000 common units at S$ 0.90 per common unit. Post listing of RHT on SGX-ST on October 19, 2012, Group''s shareholding in RHT has been diluted from 100% to 28%.

9. As part of Sponsor Agreement entered between The Trustee-Manager of RHT, FGHIPL and Hospital Service Companies (collectively referred as ''Indemnified parties'') with the Company, the Company has provided following indemnities:-

i) To RHT and its, directors, officers, employees and agents under the relevant transaction agreements against any losses or liabilities finally determined as payable for any breach of the Consolidated Foreign Direct Investment (FDI) Policy or Foreign Exchange Management Act (''FEMA''), to the extent that such breach has resulted from the acquisition by RHT of the Hospital Services Companies.

Further, the Company has undertaken to transfer or procure additional medical and healthcare services to Hospital Services Companies in the event that any regulatory authority raises concerns over compliance with any applicable law.

However, the Company will not be liable to indemnify the Indemnified Parties for any losses resulting from delay or failure of the Indemnified Parties in completing any statutory filings or similar formalities under the Consolidated FDI Policy, FEMA and other laws in force in India as of the Listing Date i.e. October 19, 2012, required to be undertaken by the Indemnified Parties in relation to the acquisition by RHT or FGHIPL of the equity shares of the Hospital Services Companies.

The Company''s obligations under this indemnity shall continue so long as the Company or the Group holds 15.0% or more of the total units from time to time issued in RHT or three years from the Listing Date, whichever is later.

However, the Company will be liable in respect of the indemnity for a maximum period of five years from the Listing Date.

ii) The Company has also undertaken to indemnify ("Tax Indemnity") each of the Hospital Services Companies and their respective directors, officers, employees and agents (the "Investing Parties") against tax liabilities (including interest and penalties levied in accordance with the Income tax Act and any cost in relation thereto) which these Investing Parties may incur due to the non-allowance of interest on Compulsorily Convertible Debentures (CCDs) or Optionally Convertible Debentures (OCDs) in the hands of the Hospital service Companies.

10. On January, 9 2012, FHML entered into Share Purchase Agreement to acquire 49% interest in FHTL at an aggregate consideration of Rs. 37,728.39 lacs. FHTL is the owner of Shalimar Bagh Clinical Establishment and Gurgaon Clinical Establishment. FHML on September 17, 2012 entered into Shareholders'' Agreement with the Company, pursuant to which FHML has a call option over the Company''s 51% interest in FHTL ("FHTL Call Option") at a fixed price, subject to fulfillment of certain conditions, applicable laws including, and receipt of necessary approvals from all third parties. FHML also has the right to appoint 50% of the directors of FHTL, including the chairman of the board of directors who will have the casting vote in case of deadlock on any matter, including all financial and operating policies of the company, brought to the board of directors for its approval. Additionally, the Company has assigned its right to receive dividends from FHTL in favour of FHML. In addition, FHML has a put option on its 49% interest in FHTL ("FHTL Put Option"), exercisable if FHML is unable to acquire 100% of the issued and paid-up share capital of FHTL within 5 years from the date of transfer of the 49% shareholding of FHTL by the Company to FHML, for any reason outside the control of FHML. The put option shall be exercised at a price that is equal to the fair market value of Put Securities on the date of exercise of put option, determined on a discounted cash flow basis.

11. During the year ended March 31, 2013, Escorts Heart Institute and Research Centre Limited (EHIRCL) have issued 401,769 Compulsorily Convertible Preference Shares (''CCPS'') of face value of Rs.10 each at a premium of Rs. 7,456.98 per CCPS to Kanishka Healthcare Limited (KHL) with a maturity period of 15 years aggregating to Rs. 30,000 lacs. Following are the key terms of CCPS:-

a) CCPS Put Option Â KHL is entitled to exercise an unconditional and irrevocable right to require the Company or its nominee to buy all of CCPS upon occurrence of KHL having exercised FHTL Put Option or FHTL Call Option under shareholders agreement entered between the Company, FHTL and FHML, as per above.

b) Under FHTL call Option the Company is required to pay sum equal to the fair valuation of Equity Shares of EHIRCL as per DCF Method.

c) In case of FHTL put option Company has right to purchase, subject to due compliance with law, all CCPS at consideration equal to KHL''s contribution along with coupon rate agreed.

12. During the year ended March 31, 2011, the Company had issued 1,000 5% Foreign Currency Convertible Bonds of US Dollar 100,000 each aggregating to US Dollar 100,000,000 due 2015 (the "Bonds"). These Bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange. The Bonds are convertible at the option of the holder at any time on or after May 18, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) up to May 11, 2015 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs. 167 with 26,922.1557 shares being issued per Bond with a fixed rate of exchange on conversion of Rs. 44.96 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be redeemed, in whole but not in part, at the option of the Company at any time on or after 18 May 2013 (subject to the Company having given at least 30 days'' notice) at 100 percent of their aggregate principal amount plus accrued but unpaid interest if the closing price of the Shares on each trading day with respect to the shares for a period of at least 30 consecutive such trading days is equal to or greater than 130 per cent of the Accreted Conversion Price (as defined in the terms and conditions of the Bonds).

The Bonds may also be redeemed in whole, but not in part, at the option of the Company subject to satisfaction of certain conditions including obtaining Reserve Bank of India ("RBI") approval, at certain early redemption amount, as specified, on the date fixed for redemption in the event of certain changes relating to taxation in India.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on May 18, 2015 at 103.1681 per cent of its principal amount. Since the redemption of bonds is contingent upon its non-conversion into Equity Shares and the probability of redemption cannot presently be ascertained, the Company has not provided for the proportionate premium on redemption for the period up to March 31, 2013 amounting to Rs. 986.62 lacs (Previous year Rs. 603.13 lacs). Such premium has been disclosed as contingent liability. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2013 considered for restatement of the Bonds at the year end was Rs. 54.285= US Dollar 1 (Rs. 50.9449 = US Dollar 1 at March 31, 2012).

13. Included in note 4(xviii) of the financial statements is service tax recoverable of Rs. 531.20 lacs (Previous year Rs. 520.66 lacs). As per management, this amount can be adjusted against service tax obligation on certain transactions as per current business plan. Hence, the management does not consider any need to make provision against non utilization of this service tax recoverable in these financial statements.

14. The Company was liable to pay Income tax for the previous years under the provisions of Section 115 JB of the Income Tax Act, 1961. As per the provisions of the Section 115JAA of the Income Tax Act, 1961, MAT credit is available to the Company in subsequent assessment years in respect of the minimum alternate tax paid in prior years. Accordingly, income tax of Rs. 1,450.85 lacs have been adjusted against the MAT credit recognized in the prior years.

15. Details of dues to Micro and Small Enterprises as per MSMED Act, 2006

During the period ended December 31, 2006, Government of India has promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 which comes into force with effect from October 2, 2006. As per the Act, the Company is required to identify the Micro, Small and Medium suppliers and pay them interest on overdue beyond the specified period irrespective of the terms agreed with the suppliers. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements.

16. Finance Act 2012, has introduced provisions with respect to domestic transfer pricing that require all tax payers to whom provisions of domestic transfer pricing apply to complete transfer pricing documentation which will form the basis of form 3CEB to be submitted with the tax authorities. The Company is currently in the process of compiling and completing the documents. The management is of the belief that the aforesaid legislation will not have any material impact on the financial statements.

17. Subsequent events

During the current year, the company initiated an institutional placement programme (IPP) for issuance of equity share of the Company. The issue was authorised by the Board of Directors through circular resolutions dated November 27, 2012 and by the Company''s shareholders through a special resolution passed by way of postal ballot the result whereof was announced on January 15, 2013.

Subsequent to March 31, 2013, the company issued 34,993,030 equity shares of face value Rs. 10 each at a price of Rs. 92 per equity share under IPP. The transaction has been concluded in May 2013. The total proceeds of the issue were approximately Rs. 32,193.59 lacs which will be use in repayment of debts, funding capital expenditure requirements and general corporate purposes.

18. Previous Year Figures

Previous year figures have been regrouped / reclassified, where necessary, to conform to this year''s classification.

Mar 31, 2012

1. Nature of Operations

Fortis Healthcare Limited (the 'Company' or 'FHL') (formerly known as Fortis Healthcare (India) Limited) was incorporated in the year 1996and commenced its hospital operations in the year 2001 with the flagship of Multi-Specialty Hospital at Mohali and has thereafter set up / acquired/ taken over the management of other hospitals in different parts of the country. As part of its business activities, the Company holds interests in its subsidiaries, joint ventures and associate companies through which it manages and operates a network of multi-specialty hospitals. The Company's equity shares are listed on both Bombay Stock Exchange and National Stock Exchange and its Foreign Currency Convertible Bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange.

2. Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects in accordance with the Notified Accounting Standards by Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year, except for the change in accounting policy explained below.

3. Segment Reporting

As the Company's business activity primarily falls within a single business and geographical segment, there are no additional disclosures to be provided in terms of Accounting Standard 17 on 'Segment Reporting'.

4. Related Party Transactions Names of Related parties (as certified by the management)

Holding Company

RHC Holding Private Limited (Holding Company of FHHPL w.e.f. December 22, 2010)

Fortis Healthcare Holdings Private Limited (formerly Fortis Healthcare Holdings Limited) ('FHHPL')

Subsidiary Companies - direct or indirect through investment in subsidiaries

1) International Hospital Limited ('IHL').

2) Fortis Hospotel Limited ('FHTL').

3) Escorts Heart Institute and Research Centre Limited ('EHIRCL')

4) Lalitha Healthcare Private Limited ('LHPL')

5) Escorts Hospital and Research Centre Limited ('EHRCL')

6) Escorts Heart and Super Speciality Institute Limited ('EHSSIL')

7) Escorts Heart and Super Speciality Hospital Limited ('EHSSHL')

8) Escorts Heart Centre Limited ('EHCL'). (Upto March 3, 2011)

9) Fortis Health Management Limited ('FHML')

10) Fortis Healthcare International Limited ('FHIL')

11) Fortis Malar Hospitals Limited ('FMHL')

12) Fortis Hospitals Limited ('FHsL')

13) Fortis Global Healthcare (Mauritius) Limited ('FGHML')

14) Kanishka Healthcare Limited ('KHL')

15) Fortis Emergency Services Limited (upto January 2, 2012, fellow subsidiary thereafter)

16) Malar Stars Medicare Limited

17) Fortis C-Doc Healthcare Limited (w.e.f. September 17, 2010)

18) Fortis Asia Healthcare Pte. Limited (w.e.f. January 7, 2011) ('FAHPL')

19) Fortis Global Healthcare Infrastructure Pte. Limited (w.e.f. March 31, 2011)

20) Hiranandani Healthcare Private Limited (w.e.f. June 28, 2011)

21) Fortis Health Management (North) Limited ('FHMNL')

22) Fortis Health Management (West) Limited ('FHMWL')

23) Fortis Health Management (South) Limited ('FHMSL')

24) Fortis Health Management (East) Limited ('FHMEL')

25) Super Religare Laboratories Limited (w.e.f. May 12, 2011) ('SRL')

26) Hospitalia Eastern Private Limited (w.e.f. October 1, 2011)

27) Fortis Health Staff Limited (w.e.f. March 18, 2011)

28) Fortis Healthcare International Pte. Limited (w.e.f. January 12, 2012) ('FHIPL')

29) Fortis Healthcare Australia Pty Ltd (w.e.f. January 12, 2012) ('FHAPL')

30) Fortis Healthcare Singapore Pte Ltd (w.e.f. January 12, 2012)

31) Altai Investments Limited (w.e.f. January 12, 2012)('AIL')

32) Mena Healthcare Investment Company Limited (w.e.f. January 12, 2012) ('MHICL')

33) Super Religare Laboratories International FZ LLC (w.e.f. January 12, 2012)

34) Fortis Healthcare Singapore Pte Limited (w.e.f. January 12, 2012) ('FHSPL')

35) Hoan My Medical Corporation (w.e.f. January 12, 2012)

36) Dental Corporation Holdings Limited (w.e.f. January 12, 2012)

37) Radlink Asia Pte Ltd (w.e.f. January 30, 2012)

38) Dental Corporation Pty Ltd (w.e.f. January 12, 2012)

39) Close Dental Pty Ltd (w.e.f. January 12, 2012)

40) Craig Duval Dental Pty Ltd (w.e.f. January 12, 2012)

41) David Cox Dental Pty Ltd (w.e.f. January 12, 2012)

42) Prime Dental Pty Ltd (w.e.f. January 12, 2012)

43) Hazel Ridge Pty Ltd (w.e.f. January 12, 2012)

44) John M Levas Pty Ltd (w.e.f. January 12, 2012)

45) Scott Petrie Dental Pty Ltd (w.e.f. January 12, 2012)

46) DC Holdings WA Pty Ltd (w.e.f. January 12, 2012)

47) Dental Care Network Pty Ltd (w.e.f. January 12, 2012)

48) Dental Corporation (NZ) Ltd (w.e.f. January 12, 2012)

49) Dental Corporation Of Canada Holdings Inc. (w.e.f. January 12, 2012)

50) Drs Lim Hoe & Wong Radiology Pte. Ltd (w.e.f. January 12, 2012)

51) Radlink Women & Fetal Imaging Pte. Ltd (w.e.f. January 30, 2012)

52) Radlink Pet and Cardiac Imaging Centre Pte Ltd (w.e.f. January 30, 2012)

53) Healthcare Diagnostic Services Pte. Ltd (w.e.f. January 12, 2012)

54) Singapore Molecular Therapy Centre Pte Ltd (w.e.f. January 12, 2012)

55) Singapore Radiopharmaceuticals Pte Ltd (w.e.f. January 12, 2012)

56) Radlink Medicare (Tampines) Pte. Ltd (w.e.f. January 30, 2012)

57) Radlink Medicare (Jurong East) Pte Ltd (w.e.f. January 30, 2012)

58) DRS Thompson & Thomson (Radlink Medicare) Pte Ltd (w.e.f. January 12, 2012)

59) Radlink Medicare (Woodlands) Pte Ltd (w.e.f. January 30, 2012)

60) Radlink Medicare (Bishan) Pte Ltd (w.e.f. January 30, 2012)

61) Clinic 1886 Pte Ltd (w.e.f. January 12, 2012)

62) Healthcare Clinic & Surgery Pte Ltd (w.e.f. January 12, 2012)

63) Radlink Diagnostic Imaging (S) Pte Ltd (w.e.f. January 30, 2012)

64) Radlink Medicare Pte. Ltd. (w.e.f. January 30, 2012)

65) Hoan My SaiGon General Hospital Joint Stock Company (w.e.f. January 12, 2012)

66) Hoan My Da Nang Deneral Hospital Joint Stock Company (w.e.f. January 12, 2012)

67) Hoan My Da LatDeneral Hospital Joint Stock Company (w.e.f. January 12, 2012)

68) Hoan My Cuu Long Deneral Hospital Joint Stock Company (w.e.f. January 12, 2012)

69) Hoan My District 3 Poly Clinic Company Limited (w.e.f. January 12, 2012)

70) Hue Medical Investment Joint Stock Company (w.e.f. January 12, 2012)

71) Quality HealthCare Limited (w.e.f. January 12, 2012)

72) Quality Healthcare Medical Services Limited (w.e.f. January 12, 2012)

73) Fortis HealthCare Hong Kong Limited (w.e.f. January 12, 2012)

74) Portex Limited (w.e.f. January 12, 2012)

75) Quality HealthCare Services Limited (w.e.f. January 12, 2012)

76) Quality HealthCare Hong Kong Limited (w.e.f. January 12, 2012)

77) Green Apple Associates Ltd (w.e.f. January 12, 2012)

78) Quality Healthcare Medical Services (Macau) Limited (w.e.f. January 12, 2012)

79) Quality EAP (Macau) Limited (w.e.f. January 12, 2012)

80) Quality Healthcare Chinese Medicine Limited (w.e.f. January 12, 2012)

81) Quality Healthcare Medical Centre Limited (w.e.f. January 12, 2012)

82) SmartLab Limited (w.e.f. January 12, 2012)

83) Allied Medical Practices Guild Limited (w.e.f. January 12, 2012)

84) Normandy ( Hong Kong) Limited (w.e.f. January 12, 2012)

85) Berkshire Group Limited (w.e.f. January 12, 2012)

86) Universal Lane Limited (w.e.f. January 12, 2012)

87) Quality Healthcare Professional Services Limited (w.e.f. January 12, 2012)

88) Global Rx Limited (w.e.f. January 12, 2012)

89) Fortis Hospitals Hong Kong Limited (w.e.f. January 12, 2012)

90) Healthcare Opportunities Limited (w.e.f. January 12, 2012)

91) Central Medical Diagnostic Centre Limited (w.e.f. January 12, 2012)

92) Marvellous Way Limited (w.e.f. January 12, 2012)

93) DB Health Services Limited (w.e.f. January 12, 2012)

94) TCM Products Limited (w.e.f. January 12, 2012)

95) GHC Holding Limited (w.e.f. January 12, 2012)

96) Case Specialist Limited (w.e.f. January 12, 2012)

97) Jadeast Limited (w.e.f. January 12, 2012)

98) Jadefairs International Limited (w.e.f. January 12, 2012)

99) Jadison Investment Limited (w.e.f. January 12, 2012)

100) Jadway International Limited (w.e.f. January 12, 2012)

101) Megafaith International Limited (w.e.f. January 12, 2012)

102) Great Option Limited (Hong Kong) (w.e.f. January 12, 2012)

103) Quality Healthcare Dental Services Limited (w.e.f. January 12, 2012)

104) Quality Healthcare Nursing Agency Limited (w.e.f. January 12, 2012)

105) Quality Healthcare Physiotherapy Services Limited (w.e.f. January 12, 2012)

106) Quality Healthcare Psycological Services Limited (w.e.f. January 12, 2012)

107) Dynamic People Group Limited (w.e.f. January 12, 2012)

108) Central MRI Centre Limited (w.e.f. January 12, 2012)

109) Central Medical Laboratory Limited (w.e.f. January 12, 2012)

110) Central PET/CT Scan Limited (w.e.f. January 12, 2012)

111) Medical Management Company Ltd (w.e.f. January 12, 2012)

112) Religare Health Trust (w.e.f. July 29,2011)

113) Super Religare Laboratories Diagnostics Private Limited ('SRLDPL') (w.e.f. May 12, 2012)

114) Swindon Limited (w.e.f. January 12, 2012) ('SL')

115) VOF PE Holdings 2 Limited (w.e.f. January 12, 2012) ('VOFPEHL') Companies (29), (31), (32), (33) and (34) above are subsidiaries of FHIPL; Company (34) above is a subsidiary of MHICL; Companies (71), (72), (73), (75), (76), (77), (78), (79), (80), (81), (82), (83), (85), (87), (90), (91), (92), (93), (94), (95), (96), (97), (98), (99), (100),(101), (103), (104), (105), (106), (108), (109) and (110) above are subsidiaries of AIL; Companies (37), (50), (51), (52), (53), (54), (55), (56), (57), (58), (59), (60), (61), (62) and (63) above are subsidiaries of FHSPL; Companies (36), (38), (39), (40), (41), (42), (43), (44), (45), (46), (47), (48) and (49) above are subsidiaries of FHAPL; Companies (11), (14), (15), (23) and (24) above are subsidiaries of FHsl; Company (4) above is a subsidiary of KHL; Company (16) above is a subsidiary of FMHL; Company (17) above is a subsidiary of FHMNL; Companies (18) and (27) above are subsidiaries of EHIRCL; Company (28) above is a subsidiary of FAHPL; Company (13) above is a subsidiary of FHIL; Companies (19) and (112) above are subsidiaries of FGHML; Company (113) above is a subsidiary of SRL; Companies (65), (66),(67),(68), (69) and (70) above are subsidiaries of SL and VOFPEHL

Fellow Subsidiaries (with whom transactions have been taken place)

Maple Leaf Buildcon Private Limited

Fortis Emergency Services Limited (w.e.f. January 3,2012)

Religare Wellness Limited

Associates

a) Sunrise Medicare Private Limited

b) Fortis Hospital Management Limited with effect from March 26, 2010 (subsidiary for the period April 8, 2008 to March 25, 2010)

c) Hiranandani Healthcare Private Limited (till June 27, 2011)

d) Medical and Surgical Centre Limited, Mauritius (Associate of Fortis Healthcare International Limited).

e) Parkways Holdings Limited from March 19, 2010 to August 20, 2010

f) Fortis Medicare International Limited with effect from June 22, 2010

g) Lanka Hospitals Corporation PLC (w.e.f. January 12, 2012) (Associate of Fortis Healthcare International Pte. Limited)

h) Town Hall Clinic (w.e.f. January 12, 2012) (Associate of Fortis Healthcare Singapore Pte. Limited)

i) Hoan My Minh Hai General Hospital Joint Stock Company (w.e.f. January 12, 2012) (Associate of SL and VOFPEHL)

j) Thien The Hoan My Joint Stock Company (w.e.f. January 12, 2012) (Associate of SL and VOFPEHL)

Joint Ventures

a) Super Religare Reference Laboratories (Nepal) Private Limited (w.e.f. May 11, 2012) (Joint venture of SRL)

b) DDRC SRL Diagnostics Services Private Limited (w.e.f. May 11, 2012) (Joint venture of SRLDPL)

c) Fortis Cauvery (w.e.f. April 27,2011), Partnership firm (Joint venture of FHMSL)

Key Management Personnel ('KMP')

Mr. Malvinder Mohan Singh Ã Executive Chairman Mr. Shivinder Mohan Singh - Executive Vice Chairman

Enterprises owned or significantly influenced by key management personnel or their relatives

a) Super Religare Laboratories Limited (till May 11, 2011)

b) Fortis Nursing and Education Society

c) Religare Travels (India) Limited

d) ReligareTechnova IT Services Limited

e) Oscar Investments Limited

f) Religare Aviation Limited

g) Malav Holdings Limited h) Shivi Holdings Limited

i) Religare Voyages Business Services Pvt Limited

j) Religare Technologies Limited

k) Religare Capital Market Limited

l) Religare Capital Market Plc.

5. Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises and few medical equipments are obtained on operating lease. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. For all cases, there are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. The total lease payments in respect of such leases recognised in the profit and loss account for the year are Rs.2,188.82 lacs (Previous Year Rs.2,013.59 lacs) and capitalized during the year are Rs.269.41 lacs (Previous Year Rs.Nil).

(b) Assets given on Operating Lease

i) The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. There are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. All these leases are cancellable in nature. The total lease income received / receivable in respect of the above leases recognised in the profit and loss account for the year are Rs.84.59 lacs (Previous Year Rs.83.99 lacs).

ii) The Company has leased out certain capital assets on operating lease to a Trust managing hospital operations and one of its Associates. The lease term is for 3 years and thereafter renewable at the option of the lessor. There are no restrictions imposed by the lease arrangements and the rent is not determined based on any contingency. There is no escalation clause in the lease agreements. The lease arrangement is non-cancellable in nature. The details of the capital assets given on operating lease are as under:

6. Deferred Tax Assets / (Liability):

The Company has deferred tax liability of Rs.595.56 lacs (previous year Rs.464.70 lacs) and deferred tax assets of Rs.706.63 lacs (previous year Rs.1,175.73 lacs) as per details below. In accordance with Accounting Standard 22 'Accounting for Taxes on Income', as notified under Companies (Accounting Standard) Rules, 2006, in view of the large amount of accumulated losses carried forward at the close of the year, deferred tax assets on timing differences, on carried-forward losses and unabsorbed depreciation have not been recognized for in the books since it is not virtually certain whether the Company will be able to use such losses/depreciation. Accordingly the company has recognised deferred tax asset of Rs. 595.56 lacs (previous year Rs. 464.70 lacs) to the extent of deferred tax liabilities and no deferred tax asset (net of deferred tax liability) has been created in these financial statements in the absence of above virtual certainity.

7. Contingent liabilities (not provided for) in respect of:

(Rs. in lacs)

Particulars As at As at March 31, 2012 March 31, 2011

Claims against the Company not acknowledged as debts (in 396.81 397.06 respect of compensation demanded by the patients / their relatives for negligence). The cases are pending with various Consumer Disputes Redressal Commissions. Based on expert opinion obtained, the management believes that the Company has good chance of success in these cases

Premium on redemption of US$ 100 Million 5% Foreign 603.13 244.58

Currency Convertible Bonds due 2015 (Refer note 20 below)

Corporate guarantee given to financial institutions/ banks in respect of financial assistance availed by subsidiaries and associates of the Company. None of the corporate guarantee have been evoked by the Banks/ Financial institutions during the year as the subsidiaries and associates of the Company have complied with the loan covenants.

- IDBI Bank 4,500.00 4,500.00

- Yes Bank 81,000.00 -

- IndusInd Bank 10,000.00 20,000.00

- Axis Bank 5,000.00 2,000.00

- Royal Bank of Scotland 1,500.00 1,500.00

- HDFC Bank Limited 26,000.00 20,000.00

- Central Bank of India 20,000.00 20,000.00

- GE Money Financial Services Private Ltd 4,500.00 -

- Housing Development Finance Corporation Limited - 6,000.00

- Kotak Mahindra Bank 5,200.00 - Others 6.47 6.47

8. Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/its subsidiaries. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan 'A'. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 (Grant III) during the year ended March 31, 2010, 1,302,250 options (Grant IV) were granted during the previous year and 200,000 options (Grant V) were granted during the current year. During the year 4,050,000 options (Grant VI) were granted under Plan 'B'. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company. The weighted average share

9. Disclosures under Accounting Standard - 15 (Revised) on 'Employee Benefits':

Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The Company also provides leave encashment benefit to its employees which is unfunded.

10. The Company has entered into 'Operation and Management' agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

11. Restructuring during the year

11.1 The Group's primary business consists of provision of Hospital Services through various entities. The Company initiated internal restructuring within the Group with a view to streamline and focus Group companies' resources and energies on different divisions and undertakings and to align the business with the internationally emerging trends by moving towards innovative and cost effective methods such as transformation to asset light models. Consequent to the internal restructuring initiated during the year, the business of certain identified hospitals of the Group are being divided into the following two verticals, such that they are managed under different verticals whilst continuing to have mutual interdependencies:

(i) One vertical (the "Clinical Establishments Division") will own, maintain and operate clinical establishments (being fully air conditioned institutions established, and specifically customized and duly fitted with all fixtures, fittings, certain medical equipment and infrastructure required for running and operating the hospitals), along with providing services under outpatient division and radio-diagnostic services (hereinafter referred to as the "Clinical Establishment Services").

(ii) The other vertical (the "Medical Services Division") will undertake the business of running the hospital operations, being hereinafter referred to as provision of medical services, including in-patient services and emergency services ("Medical Services").

11.2 The Group intends to raise long term finance on competition of this restructuring for the resultant Clinical establishment vertical. The Group is currently evaluating various options including considering raising funds through the Singapore Exchange Securities Trading Limited ('SGX-ST') subject to necessary approvals of the shareholders. The said listing is inter alia dependent on completion of the aforementioned internal restructuring, market conditions and other organizational and regulatory factors. The Group has identified Religare Health Trust (RHT), which is a business trust established in Singapore for the purposes of the proposed listing.

RHT is expected to principally invest in medical and healthcare assets and services in Asia, Australasia and emerging markets in the rest of the world besides developing medical and healthcare assets. The Company is also the "Sponsor" of RHT for the purposes of the proposed listing of RHT on the SGX-ST.

11.3 Subsequent to the balance sheet date, RHT has been granted, through a letter dated May 24, 2012 issued by SGX, a conditional 'eligibility to list' for listing on the main board of the SGX-ST.

All the investments have been sold to Fortis Health Management Limited (FHML) as part of proposed restructuring as explained more fully in note no 15 above.

12. During the year, the Company has purchased 42,749,217 equity shares of Rs.10/- each at Rs.188 per share comprising 74.59% (which has been diluted to 71.49%) of total equity share capital of Super Religare Laboratories Limited (SRL) for a total consideration of Rs.80,368.53 lacs. Accordingly, SRL has become a subsidiary of the Company effective May 12, 2011.

13. During the year, the Company has subscribed 3,000,000 equity shares of Rs.10/- each at Rs.100 per share comprising 45% of total equity share capital of Hiranandani Healthcare Private Limited (HHPL) for a total consideration of Rs.3,000.00 lacs. Prior to this the Company was holding 400,000 equity shares of Rs.10/- each comprising 40% of total equity share capital of HHPL. Accordingly, HHPL has become a subsidiary of the Company effective June 28, 2011.

14. During the year, the Company has purchased 66,000,000 equity shares of MUR.10/- each at Rs.15.23 per share comprising 67% of total equity share capital of Fortis Healthcare International Limited (FHIL) for a total consideration of Rs.10,051.80 lacs. Prior to this the Company was holding 32,560,000 equity shares of MUR.10/- each comprising 33% of total equity share capital of FHIL. Accordingly, FHIL has become a direct subsidiary of the Company effective June 1, 2011

15. During the previous year, the Company had issued 1,000 5% Foreign Currency Convertible Bonds of US Dollar 100,000 each aggregating to US Dollar 100,000,000 due 2015 (the "Bonds"). These Bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange. The Bonds are convertible at the option of the holder at any time on or after May 18, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) upto May 11, 2015 into fully paid equity shares with full voting rights at par value of Rs. 10 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs. 167 with 26,922.1557 shares being issued per Bond with a fixed rate of exchange on conversion of Rs. 44.96 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory orregulatory authority under applicable laws and regulations of India) if required, the Bonds may be redeemed, in whole but not in part, at the option of the Company at any time on or after 18 May 2013 (subject to the Company having given at least 30 days' notice) at 100 percent of their aggregate principal amount plus accrued but unpaid interest if the closing price of the Shares on each trading day with respect to the shares for a period of at least 30 consecutive such trading days is equal to or greater than 130 per cent of the Accreted Conversion Price (as defined in the terms and conditions of the Bonds).

The Bonds may also be redeemed in whole, but not in part, at the option of the Company subject to satisfaction of certain conditions including obtaining Reserve Bank of India ("RBI") approval, at certain early redemption amount, as specified, on the date fixed for redemption in the event of certain changes relating to taxation in India.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on May 18, 2015 at 103.1681 per cent of its principal amount. Since the redemption of bonds is contingent upon its non-conversion into Equity Shares and the probability of redemption cannot presently be ascertained, the Company has not provided for the proportionate premium on redemption for the period up to March 31, 2012 amounting to Rs.603.13lacs (Previous Year Rs.244.58). Such premium has been disclosed as contingent liability. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2012 considered for restatement of the Bonds at the year end was Rs.50.9449= US Dollar 1 (Rs. 44.5872 = US Dollar 1 at March 31, 2011).

The Company has incurred expenses aggregating to Rs. 1,223.09 lacs (including Rs. 25.00 lacs paid to auditors) in connection with its issue of 5% Foreign Currency Convertible Bonds. The same was adjusted against the Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

16. Pursuant to filing of the Scheme of Arrangement ("the Scheme") under section 391 to section 394 of the Companies Act, 1956, which was approved by the Hon'ble High Court of Delhi vide its order dated April 4, 2011, Sunrise Medicare Private Limited ('SMPL' and an associate of the Company) was demerged into Hospital and Consultancy Divisions. The Hospital Division of the demerged SMPL entity was merged with one of the subsidiaries of the Company, Escorts Heart and Super Speciality Hospital Limited with effect from April 1, 2010, being the appointed date as per the Scheme and the Company has been allotted 1,392,520 Preference Shares of Rs.79 each including premium of Rs. 69 each on May 16, 2011, as consideration in lieu of its shareholding in SMPL. Therefore, during the previous year, the Company has accordingly, reduced the investment in equity shares of SMPL to Rs. 0.31 lacs and has disclosed the remaining investment of Rs. 439.73 lacs, out of its original cost of investment of Rs. 440.04 lacs in equity shares of SMPL towards the preference shares of Escorts Heart and Super Speciality Hospital Limited.

17. Share application money as on March 31, 2011 was received towards employee stock option plan of the Company. 10,800 shares have been issued at Rs.71 including premium of Rs.61 and 2,000 shares have been issued at Rs.77 including premium of Rs.67 on April 12, 2012. The Company has sufficient authorised share capital to cover the share capital amount on allotment of shares out of share application money.

18. Included in note 4 (xviii) of the financial statements is service tax recoverable of Rs. 520.66 lacs (previous year Rs. 306.82 lacs). As per management, this amount can be adjusted against service tax obligation on certain transactions as per current business plan. Hence, the management doesnot consider any need to make provision against non utilization of this service tax recoverable in these financial statements.

19. The Company is liable to pay Income tax for the year under the provisions of Section 115 JB of the Income Tax Act, 1961. As per the provisions of the Section 115JAA of the Income Tax Act, 1961, MAT credit is available to the Company in subsequent assessment years in respect of the minimum alternate tax paid in current year. Accordingly, MAT credit of Rs.4,030.45 lacs (Previous Year Rs. 1,837.32 lacs) has been recognized in the current year.

20. Supplementary Statutory Information

21. Previous Year Comparatives

The financial statements for the year ended March 31, 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31,2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements.

Mar 31, 2011

1. Nature of Operations

Fortis Healthcare (India) Limited (the 'Company' or 'FHL') (formerly known as Fortis Healthcare Limited) was incorporated in the year 1996 and commenced its hospital operations in year 2001 with the flagship of Multi-Specialty Hospital at Mohali and has thereafter set up / acquired/ taken over the management of other hospitals in different parts of the country. As part of its business activities, the Company holds interests in its subsidiary and associate companies through which it manages and operates a network of multi-specialty hospitals. The Company's equity shares are listed on both Bombay Stock Exchange and National Stock Exchange. During the year, the Company issued Foreign Currency Convertible Bonds which are listed on the Euro MTF market of the Luxembourg Stock Exchange.

2. Segment Reporting

As the Company's business activity primarily falls within a single business and geographical segment, there are no additional disclosures to be provided in terms of Accounting Standard 17 on 'Segment Reporting'.

3. Related Party Transactions

Names of Related parties (as certified by the management)

Ultimate Holding Company

RHC Holding Private Limited* (Holding Company of FHHL with effect from December 22, 2010)

Holding Company Fortis Healthcare Holdings Limited ('FHHL')

Subsidiary Companies

a) International Hospital Limited ('IHL')

b) Fortis Hospotel Limited ('FHTL')

c) Escorts Heart Institute and Research Centre Limited ('EHIRCL')

d) Lalitha Healthcare Private Limited ('LHPL')

e) Escorts Hospital and Research Centre Limited ('EHRCL')

f) Escorts Heart and Super Speciality Institute Limited ('EHSSIL')

g) Escorts Heart and Super Speciality Hospital Limited ('EHSSHL')

h) Escorts Heart Centre Limited ('EHCL') (upto March 3, 2011)

i) Fortis Health Management Limited ('FHML')

j) Fortis Healthcare International Limited ('FHIL')

k) Fortis Malar Hospitals Limited ('FMHL') with effect from October 1, 2009

l) Fortis Hospitals Limited ('FHsL') with effect from June 18, 2009

m) Fortis Global Healthcare (Mauritius) Limited with effect from October 7, 2009

n) Kanishka Housing Development Company Limited with effect from December 17, 2009

o) Fortis Hospital Management Limited, (upto March 25, 2010)

p) Fortis Emergency Services Limited (with effect from April 30, 2009)

q) Malar Stars Medicare Limited (with effect from October 1, 2009)

r) Fortis C-Doc Healthcare Limited (with effect from September 17, 2010)

s) Fortis Asia Healthcare Pte. Limited (with effect from January 7, 2011)

t) Fortis Global Healthcare Infrastructure Pte. Limited (with effect from March 31, 2011)

u) Fortis Healthstaff Limited (with effect from March 18, 2011) Companies (f), (h), (s) and (u) above are subsidiaries of EHIRCL; Companies (d), (e), (g), (j), (k), (o), (p) and (r) above are subsidiaries of IHL and Company (i) above is the subsidiary of FHTL; Companies (m) and (t) above are subsidiaries of FHIL; Company (n) is the subsidiary of FHsL; Company (q) is the subsidiary of FMHL.

Fellow Subsidiaries Hiranandani Healthcare Private Limited

Fortis HealthStaff Limited (upto March 17, 2011)

Escorts Heart Center Limited (with effect from March 4, 2011)

Fortis Hospital Management Limited (with effect from March 26, 2010)

Religare Wellness Limited

Hospitalia Eastern Private Limited

Medsource Healthcare Private Limited

Fortis Global Healthcare Limited **

A-1 Book Company Private Limited **

RHC Finance Private Limited **

Maple Leaf Buildcon Private Limited **

Todays Holdings Private Limited **

Religare Infotech Private Limited **

RHC Financial Services (Mauritius) Limited **

Fortis Global Healthcare Holdings Pte. Limited (Singapore) **

Religare Infotech Pty Limited **

Altai Investments Limited **

Quality Healthcare Limited **

Quality Healthcare Medical Services Limited **

Quality Healthcare Medical Holdings Limited **

Portex Limited **

Quality Healthcare Services Limited **

Green Apple Associates Limited **

Quality HealthCare Hongkong Limited **

Quality HealthCare Medical Services (Macau)Limited **

Berkshire Group Limited **

HealthCare Opportunities Limited **

GlobalRX Limited **

SmartLab Limited **

Quality HealthCare Medical Centre Limited **

Universal Lane Limited **

Quality HealthCare Chinese Medicine Limited **

Quality HealthCare Psychological Services Limited **

Quality HealthCare Dental Services Limited **

Quality HealthCare Nursing Agency Limited **

Quality HealthCare Physiotherapy Services Limited **

Dynamic People Group Limited **

Normandy (Hongkong) Limited **

Quality EAP (Macau) Limited **

TCM Prodicts Limited **

Great Option Limited **

Marvellous Way Limited **

Poltallock Limited **

Summerset Green Limited **

Allied Medical Practices Guild Limited **

Quality HealthCare Professional Services Limited **

DB Health Services Limited **

GHC Holding Limited **

CASE Specialist Limited **

Jadeast Limited **

Jadefairs International Limited **

Jadison Investment Limited **

Jadway International Limited **

Megafaith International Limited **

Fortis Healthcare Singapore Pte. Limited **

Associates

a) Sunrise Medicare Private Limited

b) Fortis Hospital Management Limited with effect from March 26, 2010 (subsidiary upto March 25, 2010)

c) Hiranandani Healthcare Private Limited

d) Fortis Malar Hospitals Limited ('FMHL') till September 30, 2009

e) Medical and Surgical Centre Limited, Mauritius (Associate of Fortis Healthcare International Limited)

f) Parkways Holdings Limited from March 19, 2010 to August 20, 2010

g) Fortis Medicare International Limited with effect from June 22, 2010 Companies (b) and (d) are associates of International Hospital Limited. Company (e) and (g) are associates of Fortis Healthcare International Limited. Company (f) is an associate of Fortis Global Healthcare Mauritius Limited.

Key Management Personnel ('KMP')

Mr. Malvinder Mohan Singh - Chairman

Mr. Shivinder Mohan Singh - Managing Director

Enterprises owned or significantly influenced by key management personnel or their relatives

a) Super Religare Laboratories Limited

b) Ranbaxy Laboratories Limited

c) RHC Holding Private Limited

d) Fortis Nursing and Education Society

e) Religare Securities Limited

f) Religare Commodities Limited

g) Religare Finvest Limited

h) Religare Travels (India) Limited

i) Religare Technova IT Services Limited

j) Oscar Investments Limited

k) Religare Aviation Limited

l) Malav Holdings Limited

4. Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises and few medical equipments are obtained on operating lease. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. For all cases, there are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. The total lease payments in respect of such leases recognised in the profit and loss account for the year are Rs. 2,008.62 lacs (Previous Year Rs. 2,046.15 lacs).

(b) Assets given on Operating Lease

i) The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. There are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. All these leases are cancellable in nature. The total lease income received / receivable in respect of the above leases recognised in the profit and loss account for the year are Rs. 83.99 lacs (Previous Year Rs. 38.64 lacs).

ii) The Company has leased out certain capital assets on operating lease to a Trust managing hospital operations and one of its Associates. The lease term is for 3 years and thereafter renewable at the option of the lessor. There are no restrictions imposed by the lease arrangements and the rent is not determined based on any contingency. There is no escalation clause in the lease agreements. The lease arrangement is non-cancellable in nature. The details of the capital assets given on operating lease are as under:

The total lease payments received in respect of such leases recognised in the profit and loss account for the year are Rs. 749.31 lacs (Previous Year Rs. 702.77 lacs).

5. Deferred Tax Assets / (Liability):

The Company has deferred tax liability of Rs. 464.70 lacs and deferred tax assets of Rs. 1,175.73 lacs as per details below. The deferred tax liability being less than the deferred tax assets, in the context of block of assets, has not been provided for in the books as at the year end. Also, in accordance with Accounting Standard 22 'Accounting for Taxes on Income', as notified under Companies (Accounting Standard) Rules, 2006, in view of the large amount of accumulated losses carried forward at the close of the year, deferred tax assets on timing differences, on carried-forward losses and unabsorbed depreciation have not been accounted for in the books since it is not virtually certain whether the Company will be able to use such losses/depreciation.

6. Contingent liabilities (not provided for) in respect of:

(Rs. in lacs)

Particulars As at As at

March 31, 2011 March 31, 2010

Claims against the Company not acknowledged as debts (in respect of 397.06 378.06 compensation demanded by the patients / their relatives for negligence). The cases are pending with various Consumer Disputes Redressal Commissions. Based on expert opinion obtained, the management believes that the Company has good chance of success in these cases

Bank Guarantee executed in favour of National Stock Exchange ('NSE') towards Ã 700.00 listing of the shares of the Company with the exchange. The NSE has discharged the bank guarantee during the year as all the obligations relating to the same were compiled by the Company.

Provision for redemption premium of US$100 million 5% foreign currency convertible 244.58 Ã bonds due 2015 (Refer note 20 below)

Corporate guarantee given to financial institutions/ banks in respect of financial assistance availed by subsidiaries and associates of the Company. None of the corporate guarantee have been evoked by the Banks/ Financial institutions during the year as the subsidiaries and associates of the Company have complied with the loan covenants.

Ã IDBI Bank 4,500.00 4,500.00

Ã Yes Bank Ã 2,500.00

Ã IndusInd Bank 20,000.00 20,000.00

Ã Axis Bank 2,000.00 2,000.00

Ã Royal Bank of Scotland 1,500.00 1,500.00

Ã HDFC Bank Limited 20,000.00 20,000.00

Ã Central Bank of India 20,000.00 20,000.00

Ã Hongkong and Shanghai Banking Corporation Limited Ã 5,000.00

Ã Housing Development Finance Corporation Limited 6,000.00 36,000.00

Ã ING Vysa Bank Limited Ã 10,000.00

Ã The Royal Bank of Scotland Plc. Ã 104,092.63

Others 6.47 11.80

7. Employee Stock Option Plan

The Company has provided share-based payment scheme to the eligible employees and directors of the Company/its subsidiaries. During the year ended March 31, 2008, 458,500 options (Grant I) were granted to the employees under Plan 'A'. Under the same plan, 33,500 options (Grant II) were granted to the employees during the year ended March 31, 2009, 763,700 (Grant III) in the previous year and 1,302,250 options (Grant IV) were granted during the current year. The Company has granted these options under Equity Settlement method and there are no conditions for vesting other than continued employment with the Company. The weighted average share price of the Company during the year is Rs. 155.87. As at March 31, 2011, the following scheme was in operation:

8. Disclosures under Accounting Standard - 15 (Revised) on 'Employee Benefits':

Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The Company also provides leave encashment benefit to its employees which is unfunded.

9. The Company has entered into 'Operation and Management' agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

10. During the previous year the Company has redeemed 8,304,000, Class 'C' Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each, to the extent of balance of Rs. 9 each at a premium of Rs. 98.50 per share. The redemption premium of Rs. 8,179.44 lacs on these shares has been adjusted against the liability for premium on redemption of Redeemable Preference Shares and the Securities Premium.

11. During the previous year, the Company has fully redeemed 150,000, Class 'C' Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each at a premium of Rs. 11,931.78 per share. The redemption premium of Rs. 17,897.67 lacs on these shares has been adjusted against the liability for premium on redemption of Redeemable Preference Shares and the Securities Premium.

12. During the previous year, the Company has issued 260,000, Class 'C' Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each at a premium of Rs. 9,990 per share, which have been redeemed at a premium of Rs. 10,291.37 per share. The total redemption premium of Rs. 26,757.26 lacs has been adjusted against the Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

13. During the previous year, the Company has issued 260, Zero Percent Unsecured Non- Convertible Debentures of Rs. 10,000,000 each. These debentures are to be redeemed at various dates between November 25, 2010 to November 25, 2014 at an aggregate premium of Rs. 14,879.14 lacs. During the year Company has redeemed all of the above Zero Percent Unsecured Non- Convertible Debentures at a premium of Rs. 13.60 lacs per debenture. The total redemption premium of Rs. 3,534.97 lacs have been adjusted against the liability for the premium on redemption of Non Convertible Debenture and the Securities Premium.

14. On October 27, 2009, pursuant to the Letter of offer ('LOF') dated September 22, 2009 the Company allotted on Rights Basis 90,646,936 Equity Shares of Rs.10 each at a premium of Rs.100 per Equity Share aggregating to Rs.99,711.63 lacs and 90,646,936 Detachable Warrants (as an eligible Equity Shareholder was entitled to receive one Detachable Warrant for every one Equity Share allotted in the Issue). The Detachable Warrants so issued could be freely and separately traded until they are tendered for exercise. As per the LOF, the warrant exercise period was between six months to eighteen months from the date of allotment of the Equity Shares.

The Warrant Exercise Price for the Detachable Warrants was the average of (i) average of the weekly closing prices of the Equity Shares on the NSE in the 26 weeks immediately preceding the date fixed by the Company for the determination of the Warrant Exercise Price of the Detachable Warrants (the "Relevant Date") and (ii) average of the weekly closing prices of the Equity Shares on the NSE in the two weeks immediately preceding the Relevant Date.

During the current year, the Company has, in terms of the LOF, issued 87,711,986 equity shares of Rs.10 each, against conversion of detachable warrants to the entitled warrant holders, at an exercise price of Rs.153 per detachable warrant, aggregating to Rs.134,199.34 lacs.

15. During the current year, the Company has issued 1,000 5% Foreign Currency Convertible Bonds of US Dollar 100,000 each aggregating to US Dollar 100,000,000 due 2015 (the "Bonds"). These Bonds are listed on the Euro MTF market of the Luxembourg Stock Exchange. The Bonds are convertible at the option of the holder at any time on or after May 18, 2013 (or such earlier date as is notified to the holders of the Bonds by the Company) upto May 11, 2015 into fully paid equity shares with full voting rights at par value of Rs.10.00 each of the Company ("Shares") at an initial Conversion Price (as defined in the "Terms & Conditions of the Bonds") of Rs.167 with 26,922.1557 shares being issued per Bond with a fixed rate of exchange on conversion of Rs.44.96 = US Dollar 1.00. The Conversion Price is subject to adjustment in certain circumstances.

The Bonds may otherwise be redeemed, in whole or in part, at the option of the Company and holders of the bonds, before the maturity date subject to satisfaction of certain conditions.

Subject to the prior approval of the RBI (or any other statutory or regulatory authority under applicable laws and regulations of India) if required, the Bonds may be redeemed, in whole but not in part, at the option of the Company at any time on or after 18 May 2013 (subject to the Company having given at least 30 days' notice) at 100 percent of their aggregate principal amount plus accrued but unpaid interest if the Closing Price of the Shares on each Trading Day with respect to the Shares for a period of at least 30 consecutive such Trading Days is equal to or greater than 130 per cent of the Accreted Conversion Price (as defined in the terms and conditions of the Bonds).

The Bonds may also be redeemed in whole, but not in part, at the option of the Company subject to satisfaction of certain conditions including obtaining Reserve Bank of India ("RBI") approval, at certain Early Redemption Amount, as specified, on the date fixed for redemption in the event of certain changes relating to taxation in India.

Unless previously redeemed, converted or purchased and cancelled, the Bonds will be redeemed by the Company in US Dollars on May 18, 2015 at 103.1681 per cent of its principal amount. Since the redemption of bonds is contingent upon its non-conversion into Equity Shares and the probability of redemption cannot presently be ascertained, the Company has not provided for the proportionate premium on redemption for the period up to March 31, 2011 amounting to Rs.244.58 lacs (Previous Year Rs.Nil). Such premium has been disclosed as contingent liability. These Bonds are considered a monetary liability and are redeemable only if there is no conversion before maturity date.

Exchange Rate at March 31, 2011 considered for restatement of the Bonds at the year end was Rs.44.5872= US Dollar 1.

The Company has incurred expenses aggregating to Rs.1,223.09 lacs (including Rs.25.00 lacs paid to auditors) in connection with its issue of 5% Foreign Currency Convertible Bonds. The same have been adjusted against the Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

16. Pursuant to filing of the Scheme of Arrangement ("the Scheme") under section 391 to section 394 of the Companies Act, 1956, which was approved by the Hon'ble High Court of Delhi vide its order dated April 4, 2011, Sunrise Medicare Private Limited ('SMPL' and an associate of the Company) has been demerged into Hospital and Consultancy Divisions. The Hospital Division of the demerged SMPL entity has been merged with one of the subsidiaries of the Company, Escorts Heart and Super Speciality Hospital Limited with effect from April 1, 2010, being the appointed date as per the Scheme and the Company has been allotted 1,392,520 Preference Shares of Rs. 79 each including premium of Rs. 69 each on May 16, 2011, as consideration in lieu of its shareholding in SMPL. The Company has accordingly, reduced the investment in equity shares of SMPL to Rs. 0.31 lacs and has disclosed the remaining investment of Rs. 439.73 lacs, out of its original cost of investment of Rs. 440.04 lacs in equity shares of SMPL towards the preference shares of Escorts Heart and Super Speciality Hospital Limited.

17. The Company is liable to pay Income tax for the year under the provisions of Section 115 JB of the Income Tax Act, 1961. As per the provisions of the Section 115JAA of the Income Tax Act, 1961, MAT credit is available to the Company in subsequent assessment years in respect of the minimum alternate tax paid in current year. Accordingly, MAT credit of Rs. 1,837.32 lacs has been recognized in the current year.

18. Details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006

Government of India has promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 which comes into force with effect from October 2, 2006. As per the Act, the Company is required to identify the Micro, Small and Medium suppliers and pay them interest on overdue beyond the specified period irrespective of the terms agreed with the suppliers. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements.

19. Supplementary Statutory Information 26.1 Directors' Remuneration

a) Total remuneration of Mr. Shivinder Mohan Singh, Managing Director of the Company, for the year 2009-10 includes provision of Rs. 637.80 lacs for which the Company has applied for re consideration of remuneration to Central Government, which was pending for approval.

b) As the liability for Gratuity and leave encashment is provided on an actuarial basis for the Company as a whole, the amount pertaining to the Directors is not ascertainable and, therefore, not included above.

20. The Company is a Service Company and is in the business of providing healthcare services to people at large. Hence, no disclosures are required to be given for quantitative information as per the requirements of Part II of Schedule VI of the Companies Act, 1956.

21. Subsequent events

a) Subsequent to March 31, 2011, the Company has acquired remaining 10% stake in Escorts Heart Institute and Research Centre Limited ('EHIRCL') on April 27, 2011, for Rs. 13,000 lacs from Fortis Healthcare Holdings Limited, resulting in EHIRCL becoming wholly owned subsidiary of the Company.

b) Subsequent to the March 31, 2011, the Company has acquired 74.59% stake in Super Religare Laboratories Limited ('SRL') on May 12, 2011, for Rs. 80,368.53 lacs, resulting, SRL becoming subsidiary of the Company.

22. Previous Year Comparatives

Previous Year's figures have been regrouped, wherever necessary to conform to current year's classification.

Mar 31, 2010

1. Nature of Operations

Fortis Healthcare Limited (FHL or the Company) was incorporated in the year 1996 and commenced its hospital operations in year 2001 with the flagship of Multi-Specialty Hospital at Mohali and has thereafter set up / acquired/ taken over the management of other hospitals in different parts of the country. As part of its business activities, the Company holds interests in its subsidiary and associate companies through which it manages and operates a network of multi-specialty hospitals. The Companys equity shares are listed on both Bombay Stock Exchange and National Stock Exchange.

2. Segment Reporting

As the Companys business activity primarily falls within a single business and geographical segment, there are no additional disclosures to be provided in terms of Accounting Standard 17 on Segment Reporting.

3. Related Party Transactions

Names of Related parties (as certifi ed by the management)

Holding Company Fortis Healthcare Holdings Limited Subsidiary Companies a) International Hospital Limited (IHL). b) Fortis Hospotel Limited (FHTL). c) Escorts Heart Institute and Research Centre Limited (EHIRCL). d) Lalitha Healthcare Private Limited (LHPL), (with effect from January 30, 2009) e) Escorts Hospital and Research Centre Limited (EHRCL). f) Escorts Heart and Super Speciality Institute Limited (EHSSIL). g) Escorts Heart and Super Speciality Hospital Limited (EHSSHL). h) Escorts Heart Centre Limited (EHCL). i) Fortis Health Management Limited (FHML), (with effect from April 7, 2008) j) Fortis Healthcare International Limited (FHIL), (with effect from November 25, 2008) k) Fortis Malar Hospitals Limited (FMHL) (formerly Malar Hospitals Limited) with effect from October 1, 2009 l) Fortis Hospitals Limited (FHsL) with effect from June 18, 2009 m) Fortis Global Healthcare (Mauritius) Limited with effect from October 7, 2009 n) Kanishka Housing Development Company Limited with effect from December 17, 2009 o) Fortis Hospital Management Ltd. (from April 9, 2008 to March 25, 2010) p) Fortis Emergency Services Limited with effect from April 30, 2009 q) Malar Stars Medicare Limited with effect from October 1, 2009 Companies (f) and (h) above are subsidiaries of EHIRCL; Companies (d), (e), (g), (j), (k), (o) and (p) above are subsidiaries of IHL and Company (i) above is the subsidiary of FHTL; Company (m) above is the subsidiary of FHIL; Company (n) is the subsidiary of FHsL; Company (q) is the subsidiary of FMHL; Companies (e) and (g) above have become subsidiaries of IHL with effect from July 3, 2008 and July 7, 2008 respectively, prior to that these were the subsidiaries of EHIRCL.

Fellow Subsidiaries a) Fortis Health Staff Limited b) Religare Wellness Limited c) Medsource Healthcare Private Limited d) SAK Consumer Retail Services Limited (till February 4, 2010) e) Lifetime Healthcare Private Limited (till February 4, 2010) f) Pills and Powder Private Limited (till February 4, 2010) g) Hospitallia Eastern Private Limited (with effect from February 23, 2009)

Associates a) Sunrise Medicare Private Limited b) Fortis Hospital Management Limited with effect from March 26, 2010 (subsidiary for the period April 8, 2008 to March 25, 2010) c) Hiranandani Healthcare Private Limited d) Fortis Malar Hospitals Limited (FMHL) (formerly known as Malar Hospitals Limited) till September 30 2009 e) Medical and Surgical Centre Limited, Mauritius (Associate of Fortis Healthcare International Limited) with effect from January 28, 2009. f) Lalitha Healthcare Private Limited (LHPL), (till January 29, 2009) g) Parkways Holdings Limited with effect from March 19, 2010 Companies (b), (d) & (f) are associates of International Hospital Limited. Company (e) is an associate of Fortis Healthcare International Limited. Company (g) is an associate of Fortis Global Healthcare Mauritius Limited.

Key Management Personnel (KMP) Mr. Malvinder Mohan Singh - Chairman Mr. Shivinder Mohan Singh - Managing Director Enterprises owned or signifi cantly infl uenced by key management personnel or their relatives a) Super Religare Laboratories Limited b) Ranbaxy Laboratories Limited c) RHC Holding Private Limited d) Fortis Nursing and Education Society e) Religare Securities Limited f) Religare Commodities Limited g) Religare Finvest Limited h) Religare Travels (India) Limited i) Religare Technova IT Services Limited j) Oscar Investments Limited k) Religare Aviation Limited (formerly Ran Air Services Limited) l) Malav Holdings Limited

Notes:

* Formerly Ranbaxy Holding Company

** Formerly SRL Ranbaxy Limited

*** Formerly Fortis Healthworld Limited

****Associate for the period from August 4, 2008 to January 29, 2009, and Subsidiary with effect from January 30, 2009.

***** Formerly Malar Hospitals Limited, Associate up to September 30, 2009, and Subsidiary with effect from October 1, 2009

****** Subsidiary up to March 25, 2010, and Associate with effect from March 26, 2010

a) Expenses incurred on behalf of / by related parties, and later reimbursed by / to them have not been considered above.

b) Amount for the year ended March 31, 2010 includes Rs. 637.80 lacs (Previous Year Rs. 623.24 lacs) provided at the year end which is subject to Central Government approval.

c) Includes Guarantee given by the Company and EHRCL to IndusInd Bank for loan jointly availed by the Company, EHIRCL, EHRCL, EHSSIL, EHSSHL and IHL.

(b) Assets given on Operating Lease

i) The Company has sub- leased some portion of hospital premises. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. There are no restrictions imposed by lease arrangements and

4. Leases

(a) Assets taken on Operating Lease:

Hospital/ Office premises and few medical equipments are obtained on operating lease. In all the cases, the agreements are further renewable at the option of the Company. There is no escalation clause in the respective lease agreements. For all cases, there are no restrictions imposed by lease arrangements and the rent is not determined based on any contingency. The total lease payments in respect of such leases recognised in the profit and loss account for the year are Rs. 2,046.14 lacs (Previous Year Rs. 1,049.96 lacs).

The rent is not determined based on any contingency. All these leases are cancellable in nature. The total lease income received / receivable in respect of the above leases recognised in the profit and loss account for the year are Rs. 38.64 lacs (Previous Year Rs. 32.65 lacs).

ii) The Company has leased out certain capital assets on operating lease to a Trust managing hospital operations and one of its Associates. The lease term is for 3 years and thereafter renewable at the option of the lessor. There are no restrictions imposed by the lease arrangements and the rent is not determined based on any contingency. There is no escalation clause in the lease agreements. The lease arrangement is non-cancellable in nature. The details of the capital assets given on operating lease are as under:

5. Contingent liabilities (not provided for) in respect of:

(Rs. in lacs) Particulars As at As at

March 31, 2010A March 31, 2009

Claims against the Company not acknowledged as debts (in respect of compensation demanded by the patients / their relatives for negligence). The cases are pending with various Consumer Disputes Redressal Commissions. Based on expert opinion obtained, the management believes that the Company has good chance of success in these cases 378.06 326.85

Bank Guarantee executed in favour of National Stock Exchange towards listing of the shares of the Company with the exchange 700.00 -

Corporate guarantee given to fi nancial institutions/ banks in respect of fi nancial assistance availed by subsidiaries and associates of the Company - IDBI Bank 4,500.00 4,500.00

- Yes Bank 2,500.00 7,500.00

- IndusInd Bank 20,000.00 10,000.00

- Axis Bank 5,000.00 5,000.00

- ABN Amro Bank 1,500.00 1,500.00

- HDFC Bank Limited 15,000.00 -

- Central Bank of India 20,000.00 -

- Hongkong and Shanghai Banking Corporation Limited 5,000.00 -

- Housing Development Finance Corporation Limited 30,000.00 -

- ING Vysa Bank Limited 10,000.00 -

- The Royal Bank of Scotland Plc. 104,092.63 -

Others 11.80 11.23

6. Disclosures under Accounting Standard - 15 (Revised) on Employee Benefi ts:Defined Benefit Plan

The Company has a defined benefit gratuity plan, where under employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The Company also provides leave encashment benefit to its employees which is unfunded.

Notes:

a) The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

b) The Companys expected contribution to the fund in the next year is not presently ascertainable and hence, the contributions expected to be paid to the plan during the annual period beginning after the balance sheet date as required by Para 120 (o) of the Accounting Standard 15 (Revised) on Employee Benefits are not disclosed.

c) Rs. 0.94 lacs (Previous Year Rs. 0.70 lacs) out of the net benefit expenses, as above, has been allocated to a subsidiary.

7. The Company has entered into Operation and Management agreement with entities which are into hospital operations, in terms of which, the Company is responsible for developing and providing maintenance support and related services necessary to support, manage and maintain the hospital as may be required. The management fee in this case is generally based on gross billing of the hospital subject to certain conditions as per the underlying agreement. The gross billing of the hospital is considered based on the unaudited financial statements of the respective entity. The management does not anticipate any material changes in the amounts considered in financial statements.

8. During the previous year, the Company had partly redeemed 100,000, Class C Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each, to the extent of Re.1 each per such share at a premium of Rs. 12.55 per share. During the year, the Company has redeemed balance Rs.9 each at a premium of Rs. 98.35 per share. The redemption premium of Rs. 12.55 lacs in the previous year and Rs. 98.35 lacs in the Current year on these shares have been adjusted against the liability for premium on redemption of Redeemable Preference Shares and the Securities Premium.

9. During the previous year, the Company had partly redeemed 11,500,000, Class C Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each, to the extent of Re.1 each per such share at a premium of Rs. 11.50 per share. The redemption premium of Rs. 1,322.50 lacs on these shares has been adjusted against the liability for premium on redemption of Redeemable Preference Shares.

Out of the above 11,500,000, Class C Zero Percent Cumulative Redeemable Preference Shares, the Company has during the year redeemed 8,304,000, Class C Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each, to the extent of balance of Rs. 9 each at a premium of Rs. 98.50 per share. The redemption premium of Rs. 8,179.44 lacs on these shares has been adjusted against the liability for premium on redemption of Redeemable Preference Shares and the Securities Premium.

10. During the year, the Company has fully redeemed 150,000, Class C Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each at a premium of Rs. 11,931.78 per share. The redemption premium of Rs. 17,897.67 lacs on these shares has been adjusted against the liability for premium on redemption of Redeemable Preference Shares and the Securities Premium.

11. During the year, the Company has issued 260,000, Class C Zero Percent Cumulative Redeemable Preference Shares of Rs. 10 each at a premium of Rs. 9,990 per share, which have been redeemed at a premium of Rs. 10,291.37 per share. The total redemption premium of Rs. 26,757.26 lacs has been adjusted against the Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

12. During the year, the Company has issued 260, Zero Percent Unsecured Non- Convertible Debentures of Rs. 10,000,000 each. These debentures are to be redeemed at various dates between November 25, 2010 to November 25, 2014 at an aggregate premium of Rs. 14,879.14 lacs. The Company has accrued the redemption premium and debited the same to Securities Premium Account as permitted by Section 78 of the Companies Act, 1956.

13. The Company has incurred expenses aggregating to Rs. 1,265.18 lacs (including Rs 62.41 lacs paid to auditors) in connection with its Rights Issue. In terms of Section 78 of the Companies Act, 1956, the same has been adjusted against the Securities Premium.

14. During the year, pursuant to the Letter of offer dated September 22, 2009 and in accordance with the basis of allotment approved by the National Stock Exchange (Designated Stock Exchange), the Issue Committee of Board of Directors of the Company at their meeting held on October 27, 2009 allotted on Rights Basis 90,646,936 Equity Shares of Rs. 10 each at a premium of Rs. 100 per Equity Share aggregating to Rs. 99,711.63 lacs and 90,646,936 Detachable Warrants (as an eligible Equity Shareholder is entitled to receive one Detachable Warrant for every one Equity Share allotted in the Issue). The Detachable Warrants so issued can be freely and separately traded until they are tendered for exercise. The warrant exercise period shall commence after six months from date of allotment of the Equity Shares up to 18 months from the date of allotment of the Equity Shares. The Detachable Warrants may be exercised at any time prior to the expiry of a notice period within the Warrant Exercise Period.

The Warrant Exercise Price for the Detachable Warrants shall be the average of (i) average of the weekly closing prices of the Equity Shares on the NSE in the 26 weeks immediately preceding the date fixed by the Company for the determination of the Warrant Exercise Price of the Detachable Warrants (the ÃRelevant DateÃ) and (ii) average of the weekly closing prices of the Equity Shares on the NSE in the two weeks immediately preceding the Relevant Date.

For purposes of determining the Warrant Holders and their respective entitlements, the Company shall fi x the record date(s) during the Warrant Exercise Period for the Detachable Warrants (the ÃWarrant Record DateÃ), subject to the approval of the Stock Exchanges of such Warrant Record Date.

15. The Company has provided for Premium on Redemption of preference shares and Debentures. However, same has not been provided through redemption reserves as per the provisions of Section 117C of the Companies Act, 1956, as the Company does not havesufficient profits for the same.

16. During the year, the Company through its wholly owned subsidiary, Fortis Hospitals Limited, has acquired 10 Hospitals (including 2 under construction) (ÃBusiness DivisionÃ) and Kanishka Housing Development Company Limited (KHDCL) from Wockhardt Hospitals Limited vide Business Transfer Agreement executed on August 24, 2009, such acquisition being effected on December 17, 2009 on a going concern basis. The purchase consideration paid for the acquisition of the above Business Division and KHDCL amounted to Rs. 88,948.24 lacs.

17. In terms of Shareholders agreement entered into by the Subsidiary of the Company, Fortis Global Healthcare Mauritius Limited (FGHL) with Newbridge Singapore Co-Investment Pte. Ltd., Newbridge Singapore Healthcare Partners Pte. Ltd. and Newbridge Singapore Medical Partners Pte. Ltd., FGHL has acquired 23.84% stake in Parkways Holdings Limited (PHL) on March 19, 2010. FGHL has further acquired 0.85% stake in PHL through purchase from open market till March 31, 2010.

18. Details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006 Government of India has promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 which comes into force with effect from October 2, 2006. As per the Act, the Company is required to identify the Micro, Small and Medium suppliers and pay them interest on overdue beyond the specified period irrespective of the terms agreed with the suppliers. The management has confirmed that none of the suppliers have confirmed that they are registered under the provision of the Act. In view of this, the liability of the interest and disclosure are not required to be disclosed in the financial statements.

18.1 The Company is a Service Company and is in the business of providing healthcare services to people at large. Hence, no disclosures are required to be given for quantitative information as per the requirements of Part II of Schedule VI of the Companies Act, 1956.

16. Previous Years figures have been regrouped / recasted, wherever necessary to conform to current years classifi cation.

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