Notes to Accounts of Zydus Wellness Ltd.

Mar 31, 2025

13 Provisions, Contingent Liabilities and Contingent
Assets:

A Provisions are recognised when the Company has a
present obligation as a result of past events and it is
probable that the outflow of resources will be required
to settle the obligation and in respect of which reliable
estimates can be made. A disclosure for contingent
liability is made when there is a possible obligation,
that may, but probably will not require an outflow of
resources. When there is a possible obligation or a
present obligation in respect of which the likelihood of
outflow of resources is remote, no provision/ disclosure
is made. Provisions and contingencies are reviewed
at each balance sheet date and adjusted to reflect the
correct management estimates. Contingent assets are
not recognised but are disclosed separately in financial
statements.

B If the effect of the time value of money is material,
provisions are discounted using a current pre-tax rate
that reflects, when appropriate, the risks specific to the
liability.

14 Provision for Product Expiry Claims:

Provisions for product expiry related costs are
recognised when the product is sold to the customer.
Initial recognition is based on historical experience. The
initial estimate of product expiry claim related costs is
revised annually.

15 Employee Benefits:

A Short term obligations:

Liabilities for wages and salaries, including leave
encashment that are expected to be settled wholly
within 12 months after the end of the period in which
the employees render the related service are recognised
in respect of employees services up to the end of the
reporting period and are measured by the amounts
expected to be paid when the liabilities are settled. The
liabilities are presented as current employee benefit
obligations in the balance sheet.

B Long term employee benefits obligations:
a Leave Wages and Sick Leave:

The liabilities for earned leave and sick leave
are not expected to be settled wholly within
12 months period after the end of the period in
which the employees render the related service.
They are therefore, measured at the present
value of expected future payments to be made
in respect of services provided by employees
upto the end of the reporting period using the

projected unit credit method, as determined by
actuarial valuation, performed by an independent
actuary. The benefits are discounted using the
market yields at the end of reporting period that
have the terms approximating to the terms of the
related obligation. Gains and losses through re¬
measurements are recognised in statement of
profit and loss.

b Defined Benefit Plans:

Gratuity:

The Company operates a defined benefit gratuity
plan with contributions to be made to a separately
administered fund through Life Insurance
Corporation of India through Employees Group
Gratuity Plan. The Liability or asset recognised in
the balance sheet in respect of defined benefit
gratuity plan is the present value of the defined
benefit plan obligation at the end of the reporting
period less the fair value of the plan assets. The
Liabilities with regard to the Gratuity Plan are
determined by actuarial valuation, performed by
an independent actuary, at each balance sheet
date using the projected unit credit method.

The present value of the defined benefit obligation
denominated in '' is determined by discounting
the estimated future cash outflows by reference
to the market yields at the reporting period on
government bonds that have terms approximating
to the terms of the related obligation.

The net interest cost is calculated by applying the
discounting rate to the net balance of the defined
benefit obligation and the fair value of plan assets.
Such costs are included in employee benefit
expenses in the statement of Profit and Loss.

Re-measurements gains or losses arising from
experience adjustments and changes in actuarial
assumptions are recognised immediately in the
period in which they occur directly in "Other
Comprehensive Income" and are included in
retained earnings in the Statement of Changes in
Equity and in the balance sheet. Re-measurements
are not reclassified to profit or loss in subsequent
periods.

The Company recognises the following changes
in the net defined benefit obligation as an expense
in the statement of profit and loss:

i Service costs comprising current service
costs, past-service costs, gains and losses

on curtailments and non routine settlements;
and

ii Net interest expense or income.

c Defined Contribution Plans - Provident Fund
Contribution:

Employees of the Company receive benefits from
a provident fund, which is a defined contribution
plan. Both the eligible employee and the company
make monthly contributions to the provident fund
plan equal to a specified percentage of the covered
employee''s salary. Amounts collected under the
provident fund plan are deposited in a government
administered provident fund. The company
have no further obligation to the plan beyond its
monthly contributions. Such contributions are
accounted for as defined contribution plans and
are recognised as employees benefit expenses
when they are due in the statement of profit and
loss.

C Employee Separation Costs:

The compensation paid to the employees under
Voluntary Retirement Scheme is expensed in the year of
payment.

16 Dividends :

The final dividend on shares is recorded as a liability
on the date of approval by the shareholders and
interim dividend is recorded as liability on the date of
declaration by Board of Directors of the Company.

17 Financial Instruments:

A financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

A Financial assets:

a Initial recognition and measurement:

All financial assets are recognised initially at
fair value plus, in the case of financial assets
not recorded at fair value through profit or loss,
transaction cost that are attributable to the
acquisition of the financial asset. Purchases or sales
of financial assets that require delivery of assets
within a time frame established by regulation
or convention in the market place [regular way
trades] are recognised on the settlement date, i.e.,
the date that the Company settles to purchase or
sell the asset. However, trade receivables that do
not contain a significant financing component are
measured at transaction price.

b Subsequent measurement:

For purposes of subsequent measurement,
financial assets are classified in five categories:

i Debt instruments at amortised cost:

A ''debt instrument'' is measured at the
amortised cost if both the following conditions
are met:

- The asset is held with an objective of
collecting contractual cash flows

- Contractual terms of the asset give rise
on specified dates to cash flows that
are "solely payments of principal and
interest" [SPPI] on the principal amount
outstanding.

After initial measurement, such financial
assets are subsequently measured at
amortised cost using the effective interest rate
[EIR] method. Amortised cost is calculated by
taking into account any discount or premium
on acquisition and fees or costs that are an
integral part of the EIR. The EIR amortisation is
included in finance income in the Statement
of Profit and Loss. The losses arising from
impairment are recognised in the Statement
of profit and loss.

ii Debt instruments at fair value through
other comprehensive income [FVTOCI]:

A ''debt instrument'' is classified as at the
FVTOCI if both of the following criteria are
met:

- The asset is held with objectives of both
collecting contractual cash flows and
selling the financial assets

- The asset''s contractual cash flows
represent SPPI.

Debt instruments included within the FVTOCI
category are measured initially as well as at
each reporting date at fair value. Fair value
movements are recognized in the OCI.
However, the Company recognizes interest
income, impairment losses & reversals and
foreign exchange gain or loss in the Statement
of Profit and Loss. On derecognition of the
asset, cumulative gain or loss previously
recognised in OCI is reclassified from the
equity to Statement of Profit and Loss.
Interest earned whilst holding FVTOCI debt

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instrument is reported as interest income
using the EIR method.

iii Debt instruments and derivatives at fair
value through profit or loss [FVTPL]:

FVTPL is a residual category for debt
instruments. Any debt instrument, which
does not meet the criteria for categorization
as at amortized cost or as FVTOCI, is classified
as at FVTPL. Instruments included within the
FVTPL category are measured at fair value
with all changes recognized in the Statement
of Profit and Loss.

iv Investments in subsidiaries :

Investments in subsidiaries are carried at
cost less accumulated impairment losses,
if any. Where an indication of impairment
exists, the carrying amount of the investment
is assessed and written down immediately
to its recoverable amount. On disposal of
investments in subsidiaries, the differences
between net disposal proceeds and the
carrying amounts are recognised in the
statement of profit and loss.

v Equity instruments:

All equity investments in scope of Ind AS 109
are measured at fair value. Equity instruments
which are held for trading are classified as
at FVTPL. For all other equity instruments,
the Company may make an irrevocable
election to present subsequent changes in
the fair value in other comprehensive income
. The Company has made such election
on an instrument by instrument basis. The
classification is made on initial recognition
and is irrevocable.

If the Company decides to classify an equity
instrument as at FVTOCI, then all fair value
changes on the instrument, excluding
dividends, are recognized in the OCI. There
is no recycling of the amounts from OCI to
Statement of Profit and Loss, even on sale of
investment.

However, the Company may transfer the
cumulative gain or loss within equity.

Equity instruments included within the FVTPL
category are measured at fair value with all
changes recognized in the Statement of Profit
and Loss. .

c Derecognition:

A financial asset [or, where applicable, a part of
a financial asset] is primarily derecognised [i.e.
removed from the Company''s balance sheet]
when:

i The rights to receive cash flows from the asset
have expired, or

ii The Company has transferred its rights to
receive cash flows from the asset or has
assumed an obligation to pay the received
cash flows in full without material delay
to a third party under a ''pass-through''
arrangement and either [a] the Company
has transferred substantially all the risks and
rewards of the asset, or [b] the Company has
neither transferred nor retained substantially
all the risks and rewards of the asset, but has
transferred control of the asset.

When the Company has transferred its rights
to receive cash flows from an asset or has
entered into a pass-through arrangement,
it evaluates if and to what extent it has
retained the risks and rewards of ownership.
When it has neither transferred nor retained
substantially all of the risks and rewards
of the asset, nor transferred control of the
asset, the Company continues to recognise
the transferred asset to the extent of the
Company''s continuing involvement. In
that case, the Company also recognises an
associated liability. The transferred asset and
the associated liability are measured on a
basis that reflects the rights and obligations
that the Company has retained. When the
Company has transferred the risk and rewards
of ownership of the financial asset, the same
is derecognised.

d Impairment of financial assets:

In accordance with Ind AS 109, the Company
applies expected credit loss [ECL] model for
measurement and recognition of impairment loss
on trade receivables or any contractual right to
receive cash or another financial asset.

The Company follows ''simplified approach'' for
recognition of impairment loss allowance for trade
receivables or any contractual right to receive
cash or another financial asset. The application of
simplified approach does not require the Company

to track changes in credit risk. Rather, it requires
the Company to recognise the impairment loss
allowance based on lifetime ECLs at each reporting
date, right from its initial recognition.

For recognition of impairment loss on other
financial assets and risk exposure, the Company
determines that whether there has been a
significant increase in the credit risk since initial
recognition. If credit risk has not increased
significantly, 12-month ECL is used to provide
for impairment loss. However, if credit risk has
increased significantly, lifetime ECL is used. If, in a
subsequent period, credit quality of the instrument
improves such that there is no longer a significant
increase in credit risk since initial recognition,
then the entity reverts to recognising impairment
loss allowance based on 12-month ECL. Lifetime
ECL are the expected credit losses resulting from
all possible default events over the expected life
of a financial instrument. The 12-month ECL is
a portion of the lifetime ECL which results from
default events that are possible within 12 months
after the reporting date. ECL is the difference
between all contractual cash flows that are due to
the Company in accordance with the contract and
all the cash flows that the entity expects to receive
[i.e., all cash shortfalls], discounted at the original
EIR.

ECL impairment loss allowance [or reversal] is
recognized as expense/ income in the Statement of
profit and loss. The balance sheet presentation for
various financial instruments is described below:

Financial assets measured as at amortised
cost and contractual revenue receivables:
ECL is presented as an allowance , i.e., as an
integral part of the measurement of those
assets in the balance sheet, which reduces
the net carrying amount. Until the asset meets
write-off criteria, the Company does not
reduce impairment allowance from the gross
carrying amount.

For assessing increase in credit risk and impairment
loss, the Company combines financial instruments
on the basis of shared credit risk characteristics.

B Financial liabilities:

a Initial recognition and measurement:

Financial liabilities are classified, at initial
recognition, as financial liabilities at fair value

through profit or loss, loans and borrowings,
payables, or as derivatives designated as hedging
instruments in an effective hedge, as appropriate.
All financial liabilities are recognised initially at fair
value and, in the case of loans and borrowings and
payables, net of directly attributable transaction
costs.

b Subsequent measurement:

Subsequently all financial liabilities are measured
at amortised cost, using EIR method. Gains and
losses are recognised in Statement of profit and
loss when the liabilities are derecognised as well
as through the EIR amortisation process. Amortised
cost is calculated by taking into account any
discount or premium on acquisition and fees or
costs that are an integral part of the EIR. The EIR
amortisation is included as finance costs in the
Statement of profit and loss.

c Derecognition:

A financial liability is derecognised when the
obligation under the liability is discharged or
cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the terms
of an existing liability are substantially modified,
such an exchange or modification is treated as
the derecognition of the original liability and the
recognition of a new liability. The difference in the
respective carrying amounts is recognised in the
statement of profit and loss.

d Embedded derivatives:

An embedded derivative is a component of a
hybrid [combined] instrument that also includes
a non-derivative host contract - with the effect
that some of the cash flows of the combined
instrument vary in a way similar to a standalone
derivative. Derivatives embedded in all other host
contracts are accounted for as separate derivatives
and recorded at fair value if their economic
characteristics and risks are not closely related to
those of the host contracts and the host contracts
are not held for trading or designated at fair value
though profit or loss. These embedded derivatives
are measured at fair value with changes in fair value
recognised in profit or loss, unless designated as
effective hedging instruments.

C Reclassification of financial assets:

The Company determines classification of financial
assets and liabilities on initial recognition. After
initial recognition, no reclassification is made for
financial assets which are equity instruments and
financial liabilities. For financial assets which are debt
instruments, a reclassification is made only if there is
a change in the business model for managing those
assets. Changes to the business model are expected
to be infrequent. The Company''s senior management
determines change in the business model as a result
of external or internal changes which are significant to
the Company''s operations. Such changes are evident
to external parties. A change in the business model
occurs when the Company either begins or ceases to
perform an activity that is significant to its operations. If
the Company reclassifies financial assets, it applies the
reclassification prospectively from the reclassification
date which is the first day of the immediately next
reporting period following the change in business
model as per Ind AS 109.

D Offsetting of financial instruments:

Financial assets and financial liabilities are offset and
the net amount is reported in the balance sheet if
there is a currently enforceable legal right to offset
the recognised amounts and there is an intention to
settle on a net basis, to realise the assets and settle the
liabilities simultaneously.

18 Fair Value Measurement:

Fair value is the price that would be received to sell
an asset or paid to transfer a liability in an orderly
transaction between market participants at the
measurement date. The fair value measurement is
based on the presumption that the transaction to sell
the asset or transfer the liability takes place either:

a In the principal market for the asset or liability, or

b I n the absence of a principal market, in the most

advantageous market for the asset or liability

The principal or the most advantageous market must be
accessible by the Company.

The fair value of an asset or a liability is measured
using the assumptions that market participants would
use when pricing the asset or liability, assuming that
market participants act in their economic best interest.
A fair value measurement of a non-financial asset

takes into account a market participant''s ability to
generate economic benefits by using the asset in its
highest and best use or by selling it to another market
participant that would use the asset in its highest and
best use. The Company uses valuation techniques that
are appropriate in the circumstances and for which
sufficient data are available to measure fair value,
maximising the use of relevant observable inputs and
minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured
or disclosed in the financial statements are categorised
within the fair value hierarchy, described as follows,
based on the lowest level input that is significant to the
fair value measurement as a whole:
a Level 1 — Quoted [unadjusted] market prices in
active markets for identical assets or liabilities
b Level 2 — Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is directly or indirectly observable
c Level 3 — Valuation techniques for which the
lowest level input that is significant to the fair value
measurement is unobservable

For assets and liabilities that are recognised in the
financial statements on a recurring basis, the Company
determines whether transfers have occurred between
levels in the hierarchy by re-assessing categorisation
[based on the lowest level input that is significant to the
fair value measurement as a whole] at the end of each
reporting period.

19 Leases:

As a lessee:

For any new contracts entered into, the Company
considers whether a contract is, or contains a lease. A
lease is defined as ''a contract, or part of a contract, that
conveys the right to use an asset [the underlying asset]
for a period of time in exchange for consideration''.

Measurement and recognition of leases as a lessee:

At lease commencement date, the Company recognises
a right-of-use asset and a lease liability on the balance
sheet. The right-of-use asset is measured at cost, which
is made up of the initial measurement of the lease
liability, any initial direct costs incurred by the Company,
an estimate of any costs to dismantle and remove the
asset at the end of the lease, and any lease payments
made in advance of the lease commencement date [net
of any incentives received].

The Company depreciates the right-of-use assets on
a straight-line basis from the lease commencement
date to the earlier of the end of the useful life of
the right-of-use asset or the end of the lease term.
The Company also assesses the right-of-use asset
for impairment when such indicators exist. At the
commencement date, the Company measures
the lease liability at the present value of the lease
payments unpaid at that date, discounted using the
interest rate implicit in the lease if that rate is readily
available or the Company''s incremental borrowing rate.
Lease payments included in the measurement of the
lease liability are made up of fixed payments [including
in substance fixed], variable payments based on an
index or rate, amounts expected to be payable under
a residual value guarantee and payments arising from
options reasonably certain to be exercised.

Subsequent to initial measurement, the liability will
be reduced for payments made and increased for
interest. It is remeasured to reflect any reassessment or
modification, or if there are changes to the in-substance
fixed payments. When the lease liability is remeasured,
the corresponding adjustment is reflected in the right-
of-use asset, or profit and loss if the right-of-use asset
is already reduced to zero. The Company has elected
to account for short-term leases and leases of low-
value assets using the practical expedients. Instead
of recognising a right-of-use asset and lease liability,
the payments in relation to these are recognised as an
expense in Statement of Profit and Loss on a straight-line
basis over the lease term. On the statement of financial
position, right-of-use assets have been included in
property, plant and equipment."

As a lessor:

As a lessor the Company classifies its leases as either
operating or finance leases. A lease is classified as a
finance lease if it transfers substantially all the risks
and rewards incidental to ownership of the underlying
asset, and classified as an operating lease if it does not.

20 Earnings per Share:

Basic earnings per share is calculated by dividing the
net profit or loss [excluding other comprehensive
income] for the year attributable to equity shareholders
by the weighted average number of equity shares
outstanding during the year. The weighted average
number of equity shares outstanding during the year is
adjusted for events such as bonus issue, bonus element

in a right issue, shares split and reserve share splits
[consolidation of shares] that have changed the number
of equity shares outstanding, without a corresponding
change in resources.

For the purpose of calculating diluted earnings
per share, the net profit or loss [excluding other
comprehensive income] for the year attributable to
equity shareholders and the weighted average number
of shares outstanding during the year are adjusted for
the effects of all dilutive potential equity shares.

B Recent Accounting Pronouncements:

The Ministry of Corporate Affairs [MCA] notifies new
standards or amendments to the existing standards
under Companies [Indian Accounting Standards]
Rules as issued from time to time. During the year
ended March 31, 2025, MCA has notified amendments

to Ind AS 116 - Leases relating to sale and lease
back transactions, applicable from April 1, 2024. The
Company has reviewed the new amendments and
based on evaluation there is no significant impact on its
financial statements.

On May 7, 2025, MCA notifies the amendments to Ind
AS 21 - Effects of Changes in Foreign Exchange Rates.
These amendments aim to provide clearer guidance
on assessing currency exchangeability and estimating
exchange rates when currencies are not readily
exchangeable.

The amendments are effective for the year beginning
from April 1, 2025. The Company has reviewed the
new amendments and based on evaluation there is no
significant impact on its financial statements.

NOTE: 21 - PROVISIONS: (Contd...)

Defined benefit plan and long term employment benefit
A General description:

Leave wages [Long term employment benefit]:

The leave encashment scheme is administered through Life Insurance Corporation of India''s Employees'' Group Leave
Encashment cum Life Assurance [Cash Accumulation] Scheme. The employees of the company are entitled to leave as
per the leave policy of the company. The liability on account of accumulated leave as on last day of the accounting year
is recognised [net of the fair value of plan assets as at the balance sheet date] at present value of the defined obligation at
the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit
method.

Gratuity [Defined benefit plan]:

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years
or more gets a gratuity on death or resignation or retirement at 15 days salary [last drawn salary] for each completed year
of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and
salary increment risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference
to market yields at the end of the reporting period on government bonds.

Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in
the return on the plan''s debt investments.

Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of
plan participants both during and after their employment. An increase in the life expectancy of the plan participants will
increase the plan''s liability.

Salary risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants.
As such, an increase in the salary of the plan participants will increase the plan''s liability.

NOTE: 39 - FINANCIAL INSTRUMENTS:

(i) Fair values hierarchy:

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

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

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

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

(iii) Fair value of instruments measured at amortised cost:

Financial assets and liabilities measured at amortised cost for which fair values are disclosed.

Financial Assets: The carrying amounts of trade receivables, loans and other financial assets and cash and cash
equivalents are considered to be the approximately equal to the fair values.

Financial Liabilities: The carrying amounts of loans, other financial liabilities and trade payables are considered to be
approximately equal to the fair values.

(ii) Risk Management:

The Company''s activities expose it to market risk, liquidity risk and credit risk. This note explains the sources of risk which
the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

The Company''s risk management is done in close co-ordination with the board of directors and focuses on actively
securing the Company''s short, medium and long-term cash flows by minimizing the exposure to volatile financial markets.
Long-term financial investments are managed to generate lasting returns.

The Company does not actively engage in the trading of financial assets for speculative purposes nor does it write
options. The most significant financial risks to which the Company is exposed are described below:

A. Credit risk:

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. The
Company is exposed to credit risk from loans and advances to related parties, trade receivables, bank deposits and
other financial assets. The Company periodically assesses the financial reliability of the counter party taking into
account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts
receivable. Individual customer limits are set accordingly.

i Investments at Amortised Cost : They are investments in the normal course of business of the company.

ii Bank deposits: The Company maintains its Cash and cash equivalents and Bank deposits with reputed and
highly rated banks Hence, there is no significant credit risk on such deposits.

iii Loans to related parties: They are given for business purposes. The Company reassesses the recoverability of
loans periodically. Interest recoveries from these loans are regular and there is no event of defaults.

iv Trade Receivable: The Company trades with recognized and credit worthy third parties. It is the Company''s
policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In
addition, receivable balances are monitored on an on-going basis with the result that the Company''s exposure
to bad debts is not significant.

v There are no significant credit risks with related parties of the Company. The Company is exposed to credit
risk in the event of non-payment by customers. Credit risk concentration with respect to trade receivables is
mitigated by the Company''s large customer base. Adequate expected credit losses are recognized as per the
assessments. No single third party customer contributes to more than 10% of outstanding accounts receivable
[excluding outstanding from subsidiaries] as at March 31, 2025 and March 31, 2024.

_ _

a Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the
availability of funding through an adequate amount of committed credit facilities to meet obligations when
due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability
under committed facilities.

b Management monitors rolling forecasts of the Company liquidity position and cash and cash equivalents on the
basis of expected cash flows. The Company takes into account the liquidity of the market in which it operates.
In addition, the Company''s liquidity management policy involves projecting cash flows in major currencies and
considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against
internal and external regulatory requirements and maintaining debt financing plans.

Maturities of financial liabilities :

The tables below analyse the Company''s financial liabilities into relevant maturity groupings based on their
contractual maturities for all non-derivative financial liabilities. The amounts disclosed in the table are the contractual
undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting
is not significant.

The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect
to the US Dollar and Other currency. Foreign exchange risk arises from recognised assets and liabilities denominated
in a currency that is not the Company''s functional currency. The Company''s operations in foreign currency creates
natural foreign currency hedge. This results in insignificant net open foreign currency exposures considering the
volumes and operations of the Company.

NOTE 41 - CAPITAL MANAGEMENT:

The Company''s capital management objectives are

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

- to provide an adequate return to shareholders

- to maintain an optimal capital structure to reduce the cost of capital.

Management assesses the Company''s capital requirements in order to maintain an efficient overall financing structure while
avoiding excessive leverage. This takes into account the subordination levels of the Company various classes of debt. The
Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the
risk characteristics of the underlying assets.

Notes

i Mainly driven by proceeds from borrowings.

ii Mainly due to increase in finance cost on account of proceeds from borrowings.

iii Mainly due to increase in purchase and decrease in average trade payables.

iv Mainly due to decrease in current assets on account of decrease in current loans.

v Mainly due to increase in sale of products.

NOTE: 44 - DISCLOSURE OF TRANSACTION WITH STRUCK OFF COMPANIES:

The Company did not have any material transaction with companies struck off under Section 248 of the Companies Act, 2013
or Section 560 of Companies Act, 1956 during the current and previous financial year.

NOTE: 45:

The Company has used accounting software for maintaining its books of account for the financial year ended March 31, 2025
which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant
transactions recorded in the software. The audit trail has been preserved by the company as per the statutory requirements
for record retention.

NOTE: 46:

[a] The Company has not advanced or loaned or invested funds [either from borrowed funds or share premium or any
other sources or kind of funds] to any other persons or entities, including foreign entities [Intermediaries], with the
understanding, whether recorded in writing or otherwise, that the Intermediary shall directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or on behalf of the Company [Ultimate Beneficiaries] or
provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

[b] The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with
the understanding (whether recorded in writing or otherwise) that the Company shall directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries)
or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

NOTE: 47:

The Board of Directors, at their meeting held on May 19, 2025, has approved the split/ sub-division of equity shares from face
value of '' 10/- each to '' 2/- each, fully paid-up. This is subject to the approval of the shareholders at the ensuing Annual General
Meeting.

NOTE: 48:

Figures of previous reporting periods have been regrouped/ reclassified wherever necessary to correspond with the figures of
the current reporting period.

Signatures to Material Accounting Policies and Notes 1 to 48 to the Financial Statements

As per our report of even date For and on behalf of the Board

For Mukesh M. Shah & Co.

Chartered Accountants

Firm Registration Number: 106625W

Mukesh M. Shah Dr. Sharvil P. Patel Tarun Arora Umesh V. Parikh Nandish P. Joshi

Partner Chairman CEO & Whole Time Director Chief Financial Officer Company Secretary

Membership Number: 030190 DIN: 00131995 DIN: 07185311 Membership Number: A39036

Place: Ahmedabad Place: Ahmedabad Place: Ahmedabad Place: Ahmedabad Place: Ahmedabad

Date: May 19, 2025 Date: May 19, 2025 Date: May 19, 2025 Date: May 19, 2025 Date: May 19, 2025

---

Mar 31, 2024

B. The Net deferred tax Liabilities of '' 109 Millions [Net deferred tax assets of '' 194 Millions as at March 31, 2023] for the year has been debited/ [credited] in the Statement of Profit and Loss.

C. The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.

D. The Company has tax losses of '' 1,404 Millions [March 31, 2023: '' 1,832 Millions] which are available for offset for eight years against future taxable profits of the company in which the losses arose. These losses will expire in March 2029.

Defined benefit plan and long term employment benefit A General description:

Leave wages [Long term employment benefit]:

The leave encashment scheme is administered through Life Insurance Corporation of India’s Employees’ Group Leave Encashment cum Life Assurance [Cash Accumulation] Scheme. The employees of the company are entitled to leave as per the leave policy of the company. The liability on account of accumulated leave as on last day of the accounting year is recognised [net of the fair value of plan assets as at the balance sheet date] at present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

Gratuity [Defined benefit plan]:

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years or more gets a gratuity on death or resignation or retirement at 15 days salary [last drawn salary] for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary increment risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.

Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan’s debt investments.

Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan’s liability.

Salary risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan’s liability.

The expected contributions for Defined Benefit Plan for the next financial year will be '' 7 Millions [Previous year: '' 5 Millions]. The weighted average duration of the defined benefit plan obligation at the end of the reporting period is 6.61 years [as at March 31, 2023 : 6.80 years].

Note: 38 - Financial instruments:(i) Fair values hierarchy:

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

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

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data relying as little as possible on entity specific estimates. Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

(iii) Fair value of instruments measured at amortised cost:

Financial assets and liabilities measured at amortised cost for which fair values are disclosed.

Financial Assets: The carrying amounts of trade receivables, loans and other financial assets [other than investment in preference shares], cash and cash equivalents are considered to be the approximately equal to the fair values.

Financial Liabilities: The carrying amounts of loans, other financial liabilities and trade payables are considered to be approximately equal to the fair values. Fair values of investment in preference shares were calculated based on cash flows discounted using the applicable adjusted market interest rates.

(ii) Risk Management:

The Company’s activities expose it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

The Company’s risk management is done in close co-ordination with the board of directors and focuses on actively securing the Company’s short, medium and long-term cash flows by minimizing the exposure to volatile financial markets. Longterm financial investments are managed to generate lasting returns.

The Company does not actively engage in the trading of financial assets for speculative purposes nor does it write options. The most significant financial risks to which the Company is exposed are described below:

A. Credit risk:

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. The Company is exposed to credit risk from loans and advances to related parties, trade receivables, bank deposits and other financial assets. The Company periodically assesses the financial reliability of the counter party taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivable. Individual customer limits are set accordingly.

i Investments at Amortised Cost: They are investments in the normal course of business of the company.

ii Bank deposits: The Company maintains its Cash and cash equivalents and Bank deposits with reputed and highly rated banks Hence, there is no significant credit risk on such deposits.

iii Loans to related parties: They are given for business purposes. The Company reassesses the recoverability of loans periodically. Interest recoveries from these loans are regular and there is no event of defaults.

iv Trade Receivable: The Company trades with recognized and credit worthy third parties. It is the Company’s policy that alt customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an on-going basis with the result that the Company’s exposure to bad debts is not significant.

v There are no significant credit risks with related parties of the Company. The Company is exposed to credit risk in the event of non-payment by customers. Credit risk concentration with respect to trade receivables is mitigated by the Company’s large customer base. Adequate expected credit losses are recognized as per the assessments. No single third party customer contributes to more than 10% of outstanding accounts receivable [excluding outstanding from subsidiaries] as at March 31, 2024 and March 31, 2023.

The Company has used expected credit loss [ECL] model for assessing the impairment loss. For the purpose, the Company uses a provision matrix to compute the expected credit loss amount. The provision matrix takes into account external and internal risk factors and historical data of credit losses from various customers.

B Liquidity risk:

a Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability under committed facilities.

b Management monitors rolling forecasts of the Company liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company takes into account the liquidity of the market in which it operates. In addition, the Company’s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

Maturities of financial liabilities :

The tables below analyse the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities for alt non-derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the US Dollar and Other currency. Foreign exchange risk arises from recognised assets and liabilities denominated in a currency that is not the Company’s functional currency. The Company’s operations in foreign currency creates natural foreign currency hedge. This results in insignificant net open foreign currency exposures considering the volumes and operations of the Company.

The Company’s policy is to minimise interest rate cash flow risk exposures on financing. As at March 31, 2024, the Company is exposed to changes in market interest rates through bank borrowings at variable interest rates. The Company’s investments in Fixed Deposits are at fixed interest rates.

E Price Risk

(a) Exposure

The Company’s exposure to price risk arises from investments in equity and mutual funds held by the Company and classified in the balance sheet as fair value through OCI and at fair value through profit or loss respectively. To manage its price risk arising from investments in equity securities and mutual funds, the Company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Company.

(b) Sensitivity- Mutual Fund:

The table below summarises the impact of increases/decreases of the index on the Company’s equity and profit and loss for the period. The analysis is based on the assumption that the price of the instrument has increased by 2% or decreased by 2% with all other variables held constant.

Note 40: Capital management:

The Company’s capital management objectives are

- to ensure the Company’s ability to continue as a going concern

- to provide an adequate return to shareholders

- to maintain an optimal capital structure to reduce the cost of capital.

Management assesses the Company’s capital requirements in order to maintain an efficient overall financing structure while avoiding excessive leverage. This takes into account the subordination levels of the Company various classes of debt. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets.

Note: 41 - Leases:Lessee:

A Relating to statement of financial position:

The Company previously classified leases as operating or finance leases based on its assessment of whether the lease transferred substantially all risk and rewards of ownership of the underlying asset to the Company. Under Ind AS 116, the Company recognises right to use assets and lease liabilities for most leases.

Right of use assets are part of financial statement caption "Property plant and equipment’. Depreciation and impairment is similar to measurement of owned assets. Interest is part of financial statement caption "Finance cost".

Note: 43 - Disclosure of Transaction with Struck Off Companies

The Company has not entered into any transaction with companies struck off under Section 248 of the Companies Act, 2013 or

Section 560 of Companies Act, 1956 during the current and previous financial year.

Note: 44 -

[a] The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

[b] The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

[c] The Company has used accounting software for maintaining its books of account for the year ended on March 31, 2024 which has a feature of recording audit trail [edit log] facility and the same has operated throughout the year for all relevant transactions recorded in the software except that no audit trail is enabled at the database level for accounting software SAP S/4 HANA to maintain log for any direct data changes. The Company is in process of implementing the audit trail at the database level.

Note: 45 -

Figures of previous reporting periods have been regrouped/ reclassified wherever necessary to correspond with the figures of the current reporting period.

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Mar 31, 2023

Defined benefit plan and long term employment benefit A General description:

Leave wages [Long term employment benefit]:

The leave encashment scheme is administered through Life Insurance Corporation of India’s Employees’ Group Leave Encashment cum Life Assurance [Cash Accumulation] Scheme. The employees of the company are entitled to take leave as per the leave policy of the company. The liability on account of accumulated leave as on last day of the accounting year is recognised [net of the fair value of plan assets as at the balance sheet date] at present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

Gratuity [Defined benefit plan]:

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years or more gets a gratuity on death or resignation or retirement at 15 days salary [last drawn salary] for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary increment risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.

Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan’s debt investments.

Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan’s liability.

Salary risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan’s liability.

Note: 26 - Contingent liabilities and commitments [to the extent not provided for]: '' in Lakhs
Particulars	As at March 31, 2023	As at March 31, 2022
A Contingent liabilities:
a Other money for which the Company is contingently liable:
i In respect of Sales Tax and VAT matters pending before appellate authorities/ court which the Company expects to succeed, based on decisions of Tribunals/ Courts	667	667
- Net of advance of	7	7
ii In respect of Income Tax matters pending before appellate authorities which the Company expects to succeed, based on decisions of Tribunals/ Courts		32
- Net of advance of	72	34
B Commitments:
Estimated amount of contracts remaining to be executed on capital account and not provided for	455	424
- Net of advance of	68	64

Note: 38 - Financial instruments:(i) Fair values hierarchy:

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

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

Level 2 : The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data relying as little as possible on entity specific estimates. Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

(iii) Fair value of instruments measured at amortised cost:

Financial assets and liabilities measured at amortised cost for which fair values are disclosed.

Financial Assets: The carrying amounts of trade receivables, loans and other financial assets [other than investment in preference shares], cash and cash equivalents are considered to be the approximately equal to the fair values.

Financial Liabilities: Fair values of loans, other financial liabilities and trade payables are considered to be approximately equal to the carrying values. Fair values of investment in preference shares were calculated based on cash flows discounted using the applicable adjusted market interest rates.

(ii) Risk Management:

The Company’s activities expose it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

The Company’s risk management is done in close co-ordination with the board of directors and focuses on actively securing the Company’s short, medium and long-term cash flows by minimizing the exposure to volatile financial markets. Longterm financial investments are managed to generate lasting returns.

The Company does not actively engage in the trading of financial assets for speculative purposes nor does it write options. The most significant financial risks to which the Company is exposed are described below:

A. Credit risk:

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. The Company is exposed to credit risk from loans and advances to related parties, trade receivables, bank deposits and other financial assets. The Company periodically assesses the financial reliability of the counter party taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivable. Individual customer limits are set accordingly.

i Investments at Amortised Cost : They are investments in the normal course of business of the company.

ii Bank deposits : The Company maintains its Cash and cash equivalents and Bank deposits with reputed and highly rated banks Hence, there is no significant credit risk on such deposits.

iii Loans to related parties : They are given for business purposes. The Company reassesses the recoverability of loans periodically. Interest recoveries from these loans are regular and there is no event of defaults.

iv Trade Receivable: The Company trades with recognized and credit worthy third parties. It is the Company’s policy that alt customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an on-going basis with the result that the Company’s exposure to bad debts is not significant.

v There are no significant credit risks with related parties of the Company. The Company is exposed to credit risk in the event of non-payment by customers. Credit risk concentration with respect to trade receivables is mitigated by the Company’s large customer base. Adequate expected credit losses are recognized as per the assessments. No single third party customer contributes to more than 10% of outstanding accounts receivable [excluding outstanding from subsidiaries] as at March 31, 2023 and March 31, 2022. The Company has used expected credit loss [ECL] model for assessing the impairment loss. For the purpose, the Company uses a provision matrix to compute the expected credit loss amount. The provision matrix takes into account external and internal risk factors and historical data of credit losses from various customers.

B Liquidity risk:

a Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability under committed facilities.

b Management monitors rolling forecasts of the Company liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company takes into account the liquidity of the market in which it operates. In addition, the Company’s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

Maturities of financial liabilities :

The tables below analyse the Company’s financial liabilities into relevant maturity groupings based on their contractual maturities for all non-derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

C Foreign currency risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the US Dollar and Other currency. Foreign exchange risk arises from recognised assets and liabilities denominated in a currency that is not the Company’s functional currency. The Company’s operations in foreign currency creates natural foreign currency hedge. This results in insignificant net open foreign currency exposures considering the volumes and operations of the Company.

D Interest rate risk:

Liabilities:

The Company’s policy is to minimise interest rate cash flow risk exposures on long-term financing. As at March 31, 2023, the Company is exposed to changes in market interest rates through bank borrowings at variable interest rates. The Company’s investments in Fixed Deposits are at fixed interest rates.

E Price Risk (a) Exposure

The Company’s exposure to price risk arises from investments in equity and mutual funds held by the Company and classified in the balance sheet as fair value through OCI and at fair value through profit or loss respectively. To manage its price risk arising from investments in equity securities and mutual funds, the Company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Company.

Note: 41 - Leases:Lessee:

A Relating to statement of financial position:

The Company previously classified leases as operating or finance leases based on its assessment of whether the lease transferred substantially all risk and rewards of ownership of the underlying asset to the Company. Under Ind AS 116, the Company recognises right to use assets and lease liabilities for most leases.

iii Mainly due to reduction in finance cost on account of full repayment of borrowings and increase in profitability.

iv Increase in profits mainly due to a) Increase in revenues; b) Lower advertisement spends; c) Recognition of deferred tax asset.

v Increase in revenues.

vi Mainly due to shorter payment cycles of certain raw materials.

vii Increase in investable funds due to greater fund flow on account of increase in profitability and therefore, higher returns.

Note: 43 - Disclosure of Transaction with Struck Off Companies

The Company did not have any material transaction with companies struck off under Section 248 of the Companies Act, 2013

or Section 560 of Companies Act, 1956 during the current and previous financial year.

Note: 44 -

[a] The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

[b] The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Note: 45 -

Figures of previous reporting periods have been regrouped/ reclassified wherever necessary to correspond with the figures of

the current reporting period.

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Mar 31, 2022

1 Legal titles of the immovable properties are in the name of the Company [excluding lease assets].

2 Additions of Nil [Previous Year: '' 12] Lakhs in research assets during the year are included in "Additions" under the respective heads of Gross Block of Property, plant and equipment and Intangible Assets.

[*] Includes right of use assets, Refer Note 41 for detailed breakup.

C. The Company offsets tax assets and Liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.

D. The Company has tax losses of '' 23,342 Lakhs [March 31, 2021: '' 23,913 Lakhs] that are available for offsetting for indefinite period, except losses of '' 22,572 Lakhs which are available for offset for eight years against future taxable profits of the company in which the losses arose. Out of '' 22,572 Lakhs, majority of these losses will expire in March 2029. Unabsorbed Depreciation is allowed to be set-off for indefinite period.

Defined benefit plan and long term employment benefit A General description:

Leave wages [Long term employment benefit]:

The leave encashment scheme is administered through Life Insurance Corporation of India’s Employees’ Group Leave Encashment cum Life Assurance [Cash Accumulation] Scheme. The employees of the company are entitled to leave as per the leave policy of the company. The liability on account of accumulated leave as on last day of the accounting year is recognised [net of the fair value of plan assets as at the balance sheet date] at present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

Gratuity [Defined benefit plan]:

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years or more gets a gratuity on death or resignation or retirement at 15 days salary [last drawn salary] for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The plans typically expose the Company to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary increment risk.

Investment risk:

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.

Interest risk:

A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset by an increase in the return on the plan’s debt investments.

Longevity risk:

The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan’s liability.

Salary risk:

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plan’s liability.

Note: 36 - Segment Information:

Segment Information has been given in the Consolidated Financial Statements of the Company. Hence, as per Ind AS-108 "Operating Segments" issued by the Ministry of Corporate Affairs, no separate disclosure on segment information is given in these financial statements.

(i) Fair values hierarchy:

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

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

Level 2 : The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data relying as little as possible on entity specific estimates. Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

(iii) Fair value of instruments measured at amortised cost:

Financial assets and liabilities measured at amortised cost for which fair values are disclosed.

Financial Assets: The carrying amounts of trade receivables, loans and advances to related parties and other financial assets [other than investment in preference shares], cash and cash equivalents are considered to be the approximately equal to the fair values.

Financial Liabilities: Fair values of loans from banks, other financial liabilities and trade payables are considered to be approximately equal to the carrying values. Fair values of investment in preference shares were calculated based on cash flows discounted using the applicable adjusted market interest rates.

(ii) Risk Management:

The Company’s activities expose it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

The Company’s risk management is done in close co-ordination with the board of directors and focuses on actively securing the Company’s short, medium and long-term cash flows by minimizing the exposure to volatile financial markets. Longterm financial investments are managed to generate lasting returns.

The Company does not actively engage in the trading of financial assets for speculative purposes nor does it write options. The most significant financial risks to which the Company is exposed are described below:

A. Credit risk:

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. The Company is exposed to credit risk from loans and advances to related parties, trade receivables, bank deposits and other financial assets. The Company periodically assesses the financial reliability of the counter party taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivable. Individual customer limits are set accordingly.

i Investments at Amortised Cost : They are investments in the normal course of business of the company.

ii Bank deposits : The Company maintains its Cash and cash equivalents and Bank deposits with reputed and highly rated banks Hence, there is no significant credit risk on such deposits.

iii Loans to related parties : They are given for business purposes. The Company reassesses the recoverability of loans periodically. Interest recoveries from these loans are regular and there is no event of defaults.

iv Trade Receivable: The Company trades with recognized and credit worthy third parties. It is the Company’s policy that alt customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an on-going basis with the result that the Company’s exposure to bad debts is not significant.

v There are no significant credit risks with related parties of the Company. The Company is exposed to credit risk in the event of non-payment by customers. Credit risk concentration with respect to trade receivables is mitigated by the Company’s large customer base. Adequate expected credit losses are recognized as per the assessments. No single third party customer contributes to more than 10% of outstanding accounts receivable [excluding outstanding from subsidiaries] as at March 31, 2022 and March 31, 2021. The Company has used expected credit loss [ECL] model for assessing the impairment loss. For the purpose, the Company uses a provision matrix to compute the expected credit loss amount. The provision matrix takes into account external and internal risk factors and historical data of credit losses from various customers.

B Liquidity risk:

a Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability under committed facilities.

b Management monitors rolling forecasts of the Company liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company takes into account the liquidity of the market in which it operates. In addition, the Company’s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

C Foreign currency risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the US Dollar, EUR and Other currency. Foreign exchange risk arises from recognised assets and liabilities denominated in a currency that is not the Company’s functional currency. The Company’s operations in foreign currency creates natural foreign currency hedge. This results in insignificant net open foreign currency exposures considering the volumes and operations of the Company.

a Foreign currency risk exposure:

The Company’s exposure to foreign currency risk at the end of the reporting period expressed as follows: Sensitivity

The sensitivity of profit or loss and equity to changes in the exchange rates arises mainly from foreign currency denominated financial instruments.

E Price Risk (a) Exposure

The Company’s exposure to price risk arises from investments in equity and mutual funds held by the Company and classified in the balance sheet as fair value through OCI and at fair value through profit or loss respectively. To manage its price risk arising from investments in equity securities and mutual funds, the Company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the Company.

Note 40: Capital management:

The Company’s capital management objectives are

- to ensure the Company’s ability to continue as a going concern

- to provide an adequate return to shareholders

- to maintain an optimal capital structure to reduce the cost of capital.

Management assesses the Company’s capital requirements in order to maintain an efficient overall financing structure while avoiding excessive leverage. This takes into account the subordination levels of the Company various classes of debt. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets.

Note: 41 - Leases:Lessee:

A Relating to statement of financial position:

The Company previously classified leases as operating or finance leases based on its assessment of whether the lease transferred substantially all risk and rewards of ownership of the underlying asset to the Company. Under Ind AS 116, the Company recognises right to use assets and lease liabilities for most leases.

Right of use assets are part of financial statement caption "Property plant and equipment’. Depreciation and impairment is similar to measurement of owned assets. Interest is part of financial statement caption "Finance cost".

Notes

i The Company had redeemed secured Non-convertible debentures (NCDs) due to which the finance cost and premium paid on redemption in financial year ended March 31, 2021 was not applicable during financial year ended March 31, 2022, this resulting into variances in ratio as reported above.

ii During the financial year ended March 31, 2022, there had been a significant increase in the net sales on account of low base in previous financial year due to Covid correspondingly total purchase, average trade receivables and average trade payables increased when compared to the previous year financial year, this resulting into variances in ratio as reported above.

iii During the financial year ended March 31,2022, due to increase in price of certain raw materials margins have been impacted, this resulted into variances in ratio as reported above.

iv During the year ended March 31, 2022, pursuant to the trademark license agreement entered into between the Company and ZWPL, the Company has recognized royalty income.

v There was no mutual fund investments as at March 31, 2021 and March 31, 2020.

Note: 43 : COVID-19 Impact:

The World Health Organisation [WHO] declared Covid-19 to be a global pandemic in March 2020. Majority of the countries across the globe were into full or partial lockdown situation, impacting business operations across various sectors with severe restrictions on movement of people and goods.

The Company has implemented several initiatives across its manufacturing and other business locations including allowing work from homes, social distancing at work places and proper sanitization of work places etc. for ensuring safety of its employees and continuity of its business operations with minimal disruption.

As per our current assessment of the situation based on internal and external information available up to the date of approval of these financial results by the Board of Directors, the Company believes that the impact of Covid-19 on its business, assets, internal financial controls, profitability and liquidity, both present and future, would be limited and there is no indication of any material impact on the carrying amounts of inventories, goodwill, intangible assets, trade receivables, investments and other financial assets. The eventual outcome of the impact of the global health pandemic may be different from those estimated as on the date of approval of these financial statements and the Company will closely monitor any material changes to the economic environment and their impact on its business in the times to come.

Note: 44: Disclosure of Transaction with Struck Off Companies

The Company did not have any material transaction with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of Companies Act, 1956 during the current and previous financial year.

[a] The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

[b] The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Note: 46:

Figures of previous reporting periods have been regrouped/ reclassified wherever necessary to correspond with the figures of the current reporting period.

---

Mar 31, 2019

Note: 1 - Company overview:

Zydus Wellness Limited (“the Company”) was incorporated on November 1, 1994 and operates as an integrated consumer company with business encompassing the entire value chain in the development, production, marketing and distribution of health and wellness products. The product portfolio of the Company includes brands like Sugar free, Everyuth and Nutralite. The Company’s shares are listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE). The registered office of the company is located at House no. 6 & 7, Sigma Commerce Zone, Near Iscon Temple, Sarkhej-Gandhinagar Highway, Ahmedabad, Gujarat - 380015. These financial statements were authorised for issue in accordance with a resolution passed by Board of Directors at its meeting held on May 28, 2019.

Defined benefit plan and long term employment benefit A General description:

Leave wages (Long term employment benefit):

The leave encashment scheme is administered through Life Insurance Corporation of India’s Employees’ Group Leave Encashment cum Life Assurance (Cash Accumulation) Scheme. The employees of the company are entitled to leave as per the leave policy of the company. The liability on account of accumulated leave as on last day of the accounting year is recognised (net of the fair value of plan assets as at the balance sheet date) at present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

Gratuity (Defined benefit plan):

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years or more gets a gratuity on death or resignation or retirement at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The expected contributions for Defined Benefit Plan for the next financial year will be in line with FY 2018-19.

The average duration of defined benefit plan obligation at the end of the year is 23.99 (as at March 31, 2018 : 23.98 year).

Sensitivity analysis:

A quantitative sensitivity analysis for significant assumption as is as shown below:

Note: 2 - Deferred Tax:

A Break up of Deferred Tax Liabilities and Assets into major components of the respective balances are as under:

B The Net Deferred Tax Expenses of Rs. (8) [Previous Year: Rs. (38)] Lakh for the year has been debited/ credited in the Statement of Profit and Loss.

C The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.

The major components of income tax expense for the years ended March 31, 2019 and March 31, 2018 are :

(*) Security and Terms of Repayment for Secured Borrowings:

Working Capital Loan which is in the form of overdraft facility is secured by fixed deposits placed by the company with the bank. The value of such Fixed deposits classified under current asset as at March 31, 2019 is Rs.2380 Lakh (as at March 31, 2018: Rs. NIL). The outstanding amount of loan as at March 31, 2019 is Rs.2150 Lakh (as at March 31, 2018: Rs. NIL).

(**) Terms of Repayment for Unsecured Borrowings:

Working capital loans which are repayable on demand. The outstanding amount of loan as at March 31, 2019 is Rs.4,500 (as at March 31, 2018: Rs.2,500) Lakh.

Note: 3 - Dividend :

The Board of Directors, at its meeting held on May 28, 2019, recommended the final dividend of Rs.5 per equity share of Rs.10/- each. The recommended dividend is subject to the approval of the shareholders at the ensuing Annual General Meeting.

Note: 4 - Segment Information:

Segment Information has been given in the Consolidated Financial Statements of the Company. Hence, as per Ind AS-108 “Operating Segments” issued by the Institute of Chartered Accountants of India, no separate disclosure on segment information is given in these financial statements.

Note: 5 - Financial instruments:

Financial instruments

(i) Fair values hierarchy:

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

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

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

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

(ii) Financial assets and liabilities measured at fair value - recurring fair value measurements:

(iii) Fair value of instruments measured at amortised cost:

Financial assets and liabilities measured at amortised cost for which fair values are disclosed.

Financial Assets:

The carrying amounts of borrowings, interest accured but not due, investment, trade receivables, trade payables, capital creditors, Security Deposits and cash and cash equivalents are considered to be the same as their fair values.

Financial Liabilities:

Fair values of loans from banks, other financial liabilities and trade payables are considered to be approximately equal to the carrying values.

(ii) Risk Management

The company’s activities expose it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

The Company’s risk management is managed in close cooperation with the board of directors and focuses on actively securing the Company’s short to medium-term cash flows by minimizing the exposure to volatile financial markets. Long-term cash flows by minimizing the exposure to volatile financial markets. Long-term financial investments are managed to generate lasting returns.

The Company does not actively engage in the trading of financial assets for speculative purposes nor does it write options. The most significant financial risks to which the Company is exposed are described below:

A Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. The Company is exposed to credit risk from trade receivables, bank deposits and other financial assets. The Company periodically assesses the financial reliability of the counter party taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivable. Individual customer limits are set accordingly.

Investments at Amortised Cost : They are strategic investments in the normal course of business of the company.

Bank deposits : The company maintains its Cash and cash equivalents and Bank deposits with reputed and highly rated banks Hence, there is no significant credit risk on such deposits.

Loans to related parties : They are given for business purposes. The Company reassesses the recoverability of loans periodically. Interest recoveries from these loans are regular and there is no event of defaults.

Trade Receivable: The Company trades with recognized and credit worthy third parties. It is the Company’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an on-going basis with the result that the Company’s exposure to bad debts is not significant. Also the company does not enter into sales transaction with customers having credit loss history. There are no significant credit risks with related parties of the Company. The Company is exposed to credit risk in the event of non-payment by customers. Credit risk concentration with respect to trade receivables is mitigated by the Company’s large customer base. Adequate expected credit losses are recognized as per the assessments.

The history of trade receivables shows an allowance for bad and doubtful debts of Rs. NIL (Nil as at March 31, 2018). The Company has made allowance of Rs. NIL (Previous Year- Rs. NIL), against trade receivables of Rs.629 Lakh (Previous year - Rs.104 Lakh).

B Liquidity risk

a Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability under committed facilities.

b Management monitors rolling forecasts of the Company’s liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company account the liquidity of the market in which the entity operates. In addition, the Company’s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

Maturities of financial liabilities :

The tables below analyse the company’s financial liabilities into relevant maturity groupings based on their contractual maturities for all non-derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

C Foreign currency risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the US Dollar.Foreign exchange risk arises from recognised assets and liabilities denominated in a currency that is not the Company’s functional currency.The Company’s operations in foreign currency is insignificant and hence there is no material risk.

a Foreign currency risk exposure:

Sensitivity

The sensitivity of profit or loss and equity to changes in the exchange rates arises mainly from foreign currency denominated financial instruments.

b Interest rate risk

Liabilities*:

The Company’s policy is to minimise interest rate cash flow risk exposures on long-term financing. As at March 31, 2019, the Companyis exposed to changes in market interest rates through bank borrowings at variable interest rates. The Company’s investments in Fixed Deposits are at fixed interest rates.

c Price Risk

(a) Exposure

The company’s exposure to price risk arises from investments in equity and mutual fund held by the company and classified in the balance sheet as fair value through OCI and at fair value through profit or loss respectively to manage its price risk arising from investments in equity securities and mutual fund, the company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the company.

(b) Sensitivity- Mutual Fund (*)

The table below summarises the impact of increases/decreases of the index on the company’s equity and profit for the period. The analysis is based on the assumption that the price of the instrument has increased by 2% or decreased by 2% with all other variables held constant.

2 Capital management

The Company’ s capital management objectives are

- to ensure the Company’s ability to continue as a going concern

- to provide an adequate return to shareholders

- maintain an optimal capital structure to reduce the cost of capital.

Management assesses the Company’s capital requirements in order to maintain an efficient overall financing structure while avoiding excessive leverage. This takes into account the subordination levels of the Company’s various classes of debt. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets.

Loan covenants

The Company has taken loan for working capital requirement and Long Term borrowings and as at March 31, 2019, the ratio of financial indebtness net of cash and cash equivalents to the Shareholder’s Fund is 0.46 [ March 31, 2018 (-0.74)] and Interest Service Coverage Ratio is 4.25 (March 31, 2018 : 85.19).

Note: 6

Figures of previous reporting periods have been regrouped/ reclassified wherever necessary to correspond with the figures of the current reporting period.

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Mar 31, 2017

Defined benefit plan and long term employment benefit A General description:

Leave wages [Long term employment benefit]:

The leave encashment scheme is administered through Life Insurance Corporation of India''s Employees'' Group Leave Encashment cum Life Assurance [Cash Accumulation] Scheme. The employees of the company are entitled to leave as per the leave policy of the company. The liability on account of accumulated leave as on last day of the accounting year is recognized [net of the fair value of plan assets as at the balance sheet date] at present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

Gratuity [Defined benefit plan]:

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years or more gets a gratuity on death or resignation or retirement at 15 days salary [last drawn salary] for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority. The Company has tax losses which arose in India of INR 357 Lakhs (March 31, 2016: INR Nil, April 1, 2015 INR 218 Lakhs) that are available for offsetting for eight years against future taxable profits of the companies in which the losses arose. Majority of these losses are allowed to be carry forward for indefinite period.

Deferred tax assets have not been recognized in respect of these losses as they may not be used to offset taxable profits elsewhere in the Company and there are no other tax planning opportunities or other evidence of recoverability in the near future. If the Company was able to recognize all unrecognized deferred tax assets, the profit would increase by INR 110 Lakhs and MAT credit not recognized as at March 31, 2017 is INR 78 Lakhs eligible for set-off upto 15 years from the year in which the same arises.

1- Segment INFoRMATIoN:

Segment Information has been given in the Consolidated Financial Statements of the Company. Hence, as per Ind AS-108 "Operating Segments” issued by the Institute of Chartered Accountants of India, no separate disclosure on segment information is given in these financial statements.

2. Risk Management

The company''s activities expose it to market risk, liquidity risk and credit risk. This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the related impact in the financial statements.

The Company''s risk management is managed in close cooperation with the board of directors and focuses on actively securing the Company''s short to medium-term cash flows by minimizing the exposure to volatile financial markets. Long-term cash flows by minimizing the exposure to volatile financial markets. Long-term financial investments are managed to generate lasting returns.

The Company does not actively engage in the trading of financial assets for speculative purposes nor does it write options. The most significant financial risks to which the Company is exposed are described below:

3. Credit risk

Credit risk arises from the possibility that counter party may not be able to settle their obligations as agreed. The company is exposed to credit risk from trade receivables, bank deposits and other financial assets. The Company periodically assesses the financial reliability of the counter party taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivable. Individual customer limits are set accordingly.

Bank deposits: The company maintains its Cash and cash equivalents and Bank deposits with reputed and highly rated banks Hence, there is no significant credit risk on such deposits.

Trade receivable: The Company trades with recognized and credit worthy third parties. It is the Company''s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an on-going basis with the result that the Company''s exposure to bad debts is not significant. Also the company does not enter into sales transaction with customers having credit loss history. There are no significant credit risks with related parties of the Company. The Company is exposed to credit risk in the event of non-payment by customers. Credit risk concentration with respect to trade receivables is mitigated by the Company''s large customer base. Adequate expected credit losses are recognized as per the assessments.

The history of trade receivables shows an allowance for bad and doubtful debts of INR 0.3 Lakhs as at March 31, 2017. The Company has made allowance of INR Nil [Previous Year- INR Nil], against trade receivables of INR 46 Lakhs [Previous year - INR 27 Lakhs].

4. Liquidity risk

5. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due. Due to the nature of the business, the Company maintains flexibility in funding by maintaining availability under committed facilities.

6. Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis of expected cash flows. The Company account the liquidity of the market in which the entity operates. In addition, the Company''s liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

Maturities of financial liabilities :

The tables below analyze the company''s financial liabilities into relevant maturity groupings based on their contractual maturities for all non-derivative financial liabilities. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.

7. Interest rate risk Assets

The company''s fixed deposits are carried at amortized cost and are fixed rate deposits. They are therefore not subject to interest rate risk as defined in Ind AS 107, since neither the carrying amount nor the future cash flows will fluctuate because of a change in market interest rates.

8. Price risk

9. Exposure

The company''s exposure to price risk arises from investments in equity and mutual fund held by the company and classified in the balance sheet as fair value through OCI and at fair value through profit or loss respectively to manage its price risk arising from investments in equity securities and mutual fund, the company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the company.

10. Sensitivity-Mutual Fund

The table below summarizes the impact of increases / decreases of the index on the company''s equity and profit for the period. The analysis is based on the assumption that the price of the instrument has increased by 2% or decreased by 2% with all other variables held constant.

11. Capital management

The Company'' s capital management objectives are

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

- to provide an adequate return to shareholders

- to maintain an optimal capital structure to reduce the cost of capital

Management assesses the Company''s capital requirements in order to maintain an efficient overall financing structure while avoiding excessive leverage. This takes into account the subordination levels of the Company''s various classes of debt. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. The company has sufficient Cash and Cash Equivalents and Short Term Fixed Deposit available against the debt.

Loan covenants

The Company has taken loan for working capital requirement and as at March 31, 2017, the ratio of net finance cost to EBITDA was 0.42% (March 31, 2016 0.05%).

12- FIRST TIME ADOPTION OF IND AS:

The accounting policies set out in the note here have been applied in preparing the financial statements for the year ended March 31, 2017, the comparative information presented in these financial statements for the year ended March 31, 2016 and in the preparation of an opening Ind AS balance sheet at April 1, 2015 [the Company''s date of transition].

In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies [Accounting Standards] Rules, 2006 [as amended] and other relevant provisions of the Act [Indian GAAP]. An explanation of how the transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows is set out in the following notes.

Exemptions and exceptions availed:

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

13. Deemed cost:

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the Indian GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets. Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their Indian GAAP carrying values.

14. Leases:

Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. Ind AS 101 provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind AS, except where the effect is expected to be not material. The Company has elected to apply this exemption for such contracts / arrangements.

15. Designation of previously recognized financial instruments:

Ind AS 101 allows an entity to designate investments in equity instruments at FVOCI on the basis of the facts and circumstances at the date of transition to Ind AS. The Company has elected to apply this exemption for its investment in equity investments [other than investment in subsidiary].

16. Estimates:

An entity''s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with Indian GAAP [after adjustments to reflect any difference in accounting policies], unless there is objective evidence that those estimates were in error.

Ind AS estimates as at April 1, 2015 are consistent with the estimates as at the same date made in conformity with Indian GAAP. The Company made estimates in accordance with Ind AS at the date of transition as these were not required under Indian GAAP.

17. Classification and measurement of financial assets:

As per the requirement of Ind AS 101, the Company has assessed the classification of financial assets on the basis of facts and circumstances that existed at the date of transition to Ind AS.

18. De- reorganization of financial assets and liabilities:

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition

19- FIRST TIME ADOPTION OF IND AS: (contd.)

requirements in Ind AS 109 retrospectively from a date of the entity''s choosing, provided that the information needed to apply Ind AS 109 to financial assets or financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions. The Company has elected to apply the de-recognition provision of Ind AS 109 prospectively from the date of transition to Ind AS.

20. Fair Valuation adjustments for financial assets and Fair valuation of investments in Mutual Funds

Under IGAAP, security deposit given to landlord for operating lease are shown at transaction price. Under Ind AS, such transactions are discounted to their present value using incremental borrowing rate applicable to the borrower entity. The difference between the carrying value of the security deposit and its present value is accounted as differed rental expenditure grouped under loans & advances. The unwinding of discount from the date of security deposit to the transition date is shown as rental expense and recognized in "Retained earnings”. Under previous GAAP, investment in mutual funds, being current investments, were accounted at the lower of cost or fair value. Under Ind AS, mutual funds are not equity instruments and the cash flows do not represent solely payments for principal and interest and hence are to be accounted at fair value through profit and loss.

21 proposed dividend including Corporate dividend tax: Under previous GAAP, dividend on equity shares recommended by the Board of Directors after end of the reporting period but before the date of approval of financial statements was considered as an adjusting event and consequently, provision for proposed dividend was recognized as a liability in the financial statements in the reporting period relating to which dividend was proposed. Under Ind AS, such dividend is recognized in the reporting period in which the same is approved by the members in a general meeting. Consequently, the impact of INR 2,821 Lakhs has been recognized in retained earnings at the transition date.

22. actuarial loss on defined benefit plan:

Under previous GAAP, re-measurement of defined benefit plans (gratuity), arising primarily due to change in actuarial assumptions was recognized as employee benefits expense in the Statement of Profit and Loss. Under Ind AS, such re-measurement (excluding the net interest expenses on the net defined benefit liability) of defined benefit plans is recognized in OCI. Consequently, the related tax effect of the same is also recognized in OCI. For the year ended March 31, 2016, re-measurement of gratuity liability resulted in a actuarial loss of INR 16 Lakhs which has now been reduced from employee benefits expense in the Statement of Profit and Loss and recognized separately in OCI. The above changes do not affect Equity as at date of transition to Ind AS and as at March 31, 2016.

others: Sale of goods:

Under The IGAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented on the face of the statement of profit and loss as part of expenses.

other comprehensive income:

Under Ind AS, all items of income and expense recognized in a period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognized in profit or loss but are shown in the statement of profit and loss as other comprehensive income include re-measurements of defined benefit plans and fair value gains or (losses) on FVOCI equity instruments and corresponding tax impact thereon. The concept of other comprehensive income did not exist under previous GAAP.

Statement of cash flows:

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

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Mar 31, 2016

Note : 1 - Long Term Provisions:

Disclosure pursuant to Accounting Standard - 15 [Revised] "Employee Benefits":

Defined benefit plan and long term employment benefit

A General description:

Leave wages [Long term employment benefit]:

The Leave encashment scheme is administered through Life Insurance Corporation of India''s "Employees'' Group Leave Encashment-cum-Life Assurance [Cash Accumulation] Scheme". The employees of the Company are entitled to leave as per the leave policy of the Company. The liability on account of the accumulated leave as on last day of the accounting year is recognised [net of the fair value of plan assets as at the balance sheet date] at the present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

Gratuity [Defined benefit plan]:

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years or more, gets a gratuity on death or resignation or retirement at 15 days salary [last drawn salary] for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

Note : 2

a Effective from April 1, 2014, the Company had started providing depreciation on tangible assets on "straight line method" over the revised remaining useful lives of the tangible assets in alignment with useful lives prescribed in Schedule II to the Companies Act, 2013. Consequently, the depreciation charge for the year ended March 31, 2015 was higher by Rs. 196 Lacs. Further, an amount of Rs. 19 Lacs had been recognised in the opening balance of retained earnings which relate to the carrying amount of tangible assets whose revised remaining useful life was Nil as at April 1, 2014.

b Additionally, an amount of Rs. 7 Lacs had been recognised in the opening balance of retained earnings, which relate to the carrying amount of tangible assets of Zydus Wellness-Sikkim (the firm), whose revised remaining useful life was Nil as on April 1, 2014 and which had been adjusted against the current capital of the Company in the firm.

Note : 3

Previous year''s figures have been regrouped/ reclassified wherever necessary to correspond with the current year''s classifications/disclosure.

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Mar 31, 2015

I. Company overview:

Zydus Wellness Limited ["the Company"] was incorporated on November 1,1994 and operates as an integrated consumer company with business encompassing the entire value chain in the development, production, marketing and distribution of health and wellness products. The product portfolio of the Company includes brands like Sugar free, Everyuth and Nutralite. The Company''s shares are listed on the National Stock Exchange of India Limited [NSE] and Bombay Stock Exchange Limited [BSE].

INR - Lacs As at March 31 2015 2014

Note : 2 - Contingent Liabilities and Commitment [to the extent not provided for]:

A Contingent Liabilities:

a Claims against the Company not acknowledged as debts 20 20

b In respect of guarantees given by Banks and/ or counter guarantees given by the Company 3 2

c Other money for which the Company is contingently liable:

i In respect of Sales Tax matters pending before appellate authorities 77 88

ii In respect of Income Tax matters pending before appellate authorities 194 193

B Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for [Net of Advances] 28 23

Note : 3 - Segment Information:

The Company operates in one segment only, namely "Consumer Products." The Company also exports its products to other countries. However the value being below threshold limit prescribed under Accounting Standard [AS] 17-"Segment Reporting", the reporting is not required.

Note : 4

a Effective from April 1, 2014, the Company has started providing depreciation on tangible assets on "straight line method" over the revised remaining useful lives of the tangible assets in alignment with useful lives prescribed in Schedule II to the Companies Act, 2013.

Consequently, the depreciation charge for the year ended March 31, 2015 is higher by Rs. 196 Lacs. Further, an amount of Rs. 19 Lacs has been recognised in the opening balance of retained earnings which relate to the carrying amount of tangible assets whose revised remaining useful life was Nil as at April 1, 2014.

b Additionally, an amount of Rs. 7 Lacs has been recognised in the opening balance of retained earnings, which relate to the carrying amount of tangible assets of Zydus Wellness-Sikkim (the firm), whose revised remaining useful life was Nil as on April 1, 2014 and which has been adjusted against the current capital of the Company in the firm.

Note : 5

Previous year''s figures have been regrouped/ reclassified wherever necessary to correspond with the current year''s classifications/ disclosure.

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Mar 31, 2013

1. Company Overview:

Zydus Wellness Limited ["the Company"] was incorporated on November 1, 1994 and operates as an integrated consumer company with business encompassing the entire value chain in the development, production, marketing and distribution of health and wellness products. The product portfolio of the Company includes brands like Sugar free, Everyuth, Nutralite and Actilife. The Company''s shares are listed on the National Stock Exchange of India Limited [NSE] and Bombay Stock Exchange Limited [BSE]. The Registered Office of the company is situated at Zydus Tower, Satellite Cross Roads, Sarkhej-Gandhinagar Highway, Ahmedabad-380015.

Note : 2 - Interim Dividend:

The Board of Directors, at its meeting held on May 13, 2013, declared an interim dividend of Rs.6/- per equity share of Rs. 10/- each.

Note : 3 - Segment Information:

The company operates in one segment only, namely "Consumer Products." During the year, the Company has started exporting its products to other countries. However the value being below threshold limit prescribed under Accounting Standard (AS)-17- "Segment Reporting", the reporting is not required.

Note : 4 - Related Party Transactions:

A Name of the Related Parties and Nature of the Related Party Relationship: a Holding Company: Cadila Healthcare Limited b Partnership Firm: M/s. Zydus Wellness - Sikkim c Fellow Subsidiaries/Concerns:

Dialforhealth India Limited Zydus Pharmaceuticals (USA) Inc. [USA]

Dialforhealth Unity Limited Nesher Pharmaceuticals (USA) LLC [USA]

Dialforhealth Greencross Limited Zydus Healthcare (USA) LLC [USA]

German Remedies Limited Zydus Noveltech Inc. [USA]

Zydus Pharmaceuticals Limited Hercon Pharmaceuticals LLC [USA]

Zydus Animal Health Limited Zydus Healthcare S.A. (Pty) Ltd [South Africa]

Liva Healthcare Limited Simayla Pharmaceuticals (Pty) Ltd

[South Africa]

Zydus Technologies Limited Script Management Services (Pty) Ltd

[South Africa]

Biochem Pharmaceutical Industries Limited Zydus Nikkho Farmaceutica Ltda. [Brazil]

M/s. Zydus Healthcare, a Partnership Firm Zydus Pharma Japan Co. Ltd. [Japan]

Zydus Lanka (Private) Limited [Sri Lanka] Laboratorios Combix S.L. [Spain]

c Fellow Subsidiaries/Concerns:

Zydus International Private Limited [Ireland] Zydus Pharmaceuticals Mexico SA De CV

[Mexico]

Zydus Netherlands B.V. [the Netherlands] Zydus Pharmaceuticals Mexico Services

Company SA De C.V.[Mexico]

Zydus France, SAS [France] ZAHL B.V. [the Netherlands]

Etna Biotech S.R.L. [Italy] Bremer Pharma GmbH [Germany]

ZAHL Europe B.V. [the Netherlands] d Key Management Personnel:

Mr. Elkana Ezekiel - Managing Director

Note : 5

Previous year''s figures have been regrouped/ reclassified wherever necessary to correspond with the current year''s classifications/ disclosure.

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Mar 31, 2012

Defined benefit plan and long term employment benefit A General description:

Leave wages [Long term employment benefit]:

The Leave encashment scheme is administered through Life Insurance Corporation of India's "Employees' Group Leave Encashment-cum-Life Assurance [Cash Accumulation] Scheme". The employees of the Company are entitled to leave as per the leave policy of the Company. The liability on account of the accumulated leave as on last day of the accounting year is recognised [net of the fair value of plan assets as at the balance sheet date] at the present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

Gratuity [Defined benefit plan]:

The Company has a defined benefit gratuity plan. Every employee who has completed continuous services of five years or more, gets a gratuity on death or resignation or retirement at 15 days salary [last drawn salary] for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

Note : 18 - Contingent Liabilities and commitment [to the extent not provided for]:

A Contingent Liabilities:

a Claims against the Company not acknowledged as debts. 20 20

b Other money for which the company is contingently liable:

i In respect of Sales Tax matters pending before appellate authorities. 55 61

ii In respect of Income Tax matters pending before appellate authorities. 165 119

c In respect of guarantees given by Banks and/or counter guarantees given by the Company. 2 2

d The company has imported certain capital equipment at concessional rate of custom duty under "Export Promotion Capital Goods Scheme" of the Central Government. The Company has undertaken an export obligation to the extent of US $ 30.29 Lacs [equivalent to Rs. 1540 Lacs approx. {Previous Reporting Period US $ 30.29 Lacs (Equivalent to Rs. 1350 Lacs)}] to be fulfilled during a specified period as applicable from the date of imports. 155 155

B Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for [Net of Advances]. 31 83

Note : 1 - Segment Information:

The company operates in one segment only, namely "Consumer Products." The Company has only one plant located in Gujarat and the company sells its products in India. Hence, there is no geographical segment also. Therefore, the segment reporting is not applicable.

Note : 2

The Revised Schedule VI has become effective from April 1, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous reporting period's figures have been regrouped/reclassified wherever necessary to correspond with the current reporting period's classifications/disclosure.

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Mar 31, 2011

1 Previous year’s figures have been regrouped and rearranged wherever necessary to make it comparable with the current year’s figures.

2 The company has taken various office premises / godowns under operating lease or leave and license agreement. The lease terms in respect of such premises are on the basis of individual agreements entered into with the respective landlords. The company has given refundable interest free security deposits in accordance with the agreed terms. The lease payments are recognised in the Profit & Loss Account under “ Rent “ in Schedule -14.

3 The company has imported certain capital equipments at concessional rate of custom duty under “Export Promotion Capital Goods scheme” of the Central Government .The Company has undertaken an export obligation to the extent of US $ 30.29 Lacs [ equivalent to Rs. 1350 Lacs approx. { Previous Year US $ 30.29 Lacs ( Equivalent to Rs.1360 Lacs ) } ] to be fulfilled during a specified period as applicable from the date of imports. The liability towards customs duty payable thereon in respect of unfulfilled export obligation as on March 31, 2011 of Rs. 155 Lacs [ as at 31-03-10 : Rs.155 Lacs ] is not provided for.

4 Contingent Liabilities not provided for in respect of :

INR - Lacs Year ended March 31, 2011 2010

A Claims against the Company not acknowledged as debts 20 22

B Sales Tax matters pending in appeals 61 6 C Income Tax matters pending in appeals 119 0 D Guarantees given by a bank and counter guarantees given by the company 2 0

5 During the Year, the Company has paid to Bharatiya Janta Party, Contribution of Rs. 100 lacs, pursuan to provision of Section 293A of the Companies Act, 1956.

6 Segment Information :

The company operates in one segment only, namely “Consumer Products.” The Company has only on plant located in Gujarat and the company sells its products in India. Hence, there is no geographica segment also. Therefore, the segment reporting is not applicable.

7 Micro, Small and Medium Enterprises : A Under the Micro, Small and Medium Enterprises Development Act, 2006, [ MSMED ] which came into force from October 2, 2006, certain disclosures are required to be made relating to Micro, Small and Medium enterprises.

INR - Lacs Year ended March 31, 2011 2010

- Principal amount remaining unpaid to any supplier as at the year end 0 0

- Interest due thereon 0 0

- Amount of interest paid by the Company in terms of section 16 of the MSMED, along with the amount of the payment made to the supplier beyond the appointed day during the accounting year 0 0

- Amount of interest due and payable for the period of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified under the MSMED 0 0

- Amount of interest accrued and remaining unpaid at the end of the accounting year 0 0

B The above information has been compiled in respect of parties which could be identified as Micro, Small and Medium Enterprises on the basis of information available with the Company.

8 Related Party Transactions : A Name of the Related Party and Nature of the Related Party Relationship :

a Holding Company : Cadila Healthcare Limited [ CHL ]

b Partnership Firm : M/s. Zydus Wellness - Sikkim - a Partnership Firm [ ZWS ]

c Fellow Subsidiaries :

Liva Healthcare Limited [ LHL ]

German Remedies Limited

Zydus Technologies Limited

Dialforhealth India Limited [ DHL ]

Dialforhealth Unity Limited

Dialforhealth Greencross Limited

Zydus Pharmaceuticals Limited

Zydus Animal Health Limited [ ZAHL ]

M/s. Zydus Healthcare, Sikkim, a Partnership Firm

Zydus Healthcare Brasil Ltda [ Brazil ]

Zydus Pharmaceuticals (USA) Inc. [ USA ]

Simayla Pharmaceuticals (Pty) Ltd, [ South Africa ]

Zydus Pharmaceuticals Mexico S.A. de C.V. [ Mexico ]

Zydus Healthcare S. A. [Pty] Ltd. [ South Africa ]

Zydus International Private Limited [ Ireland ]

Zydus Pharma Japan Co. Ltd [ Japan ]

Zydus Healthcare (USA) LLC [ USA ]

Zydus France, SAS [ France ]

Zydus Noveltech Inc. [ USA ]

Zydus IntRus Limited [ Russia ]

Quimica E Farmaceutica Nikkho Do, Brasil Ltda. [Brazil]

Zydus Netherlands B.V. [ The Netherlands ]

Laboratorios Combix S.L. [ Spain ]

Etna Biotech S.R.L., [ Italy ]

Script Management Services [ Pty ] Ltd., [ South Africa ]

Zydus Pharmaceuticals Mexico Service Company S.A. de C.V. [ Mexico ]

d Key Management Personnel :

Mr. Anand Deo - Managing Director

9 A Provision for product expiry claims in respect of products sold during the year is made based on the management’s estimates considering the estimated stock lying with retailers. The company does not expect any reimbursement of such claim in future. As the provision made in previous year is considered adequate, no further provision has been made in current year.

10 Deferred Tax :

A The Net Deferred tax Liability of Rs. 113 [ Previous Year : Rs. ( 76 ) ] lacs for the year has been provided in the Profit and Loss Account.

16 Disclosure pursuant to Accounting Standard - 15 [ Revised ] ‘Employee Benefits’ :

A Defined benefit plan and long term employment benefit :

a General description :

Gratuity [ Defined benefit plan ] :

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on death or resignation or retirement at 15 days salary [ last drawn salary ] for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

Privilege Leave [ Long term employment benefit ] :

The Leave encashment scheme is administered through Life Insurance Corporation of India’s “Employees’ Group Leave Encashment-cum-Life Assurance [ Cash Accumulation ] Scheme”. The employees of the Company are entitled to leave as per the leave policy of the Company. The liability on account of the accumulated leave as on last day of the accounting year is recognised [ net of the fair value of plan assets as at the balance sheet date ] at the present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.

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Mar 31, 2010

1 Previous years figures have been regrouped and rearranged wherever necessary.

2 During February, 2010, a fire broke out at one of the warehouse of the company. The company is in the process of lodging a claim with the Insurance company, amounting to Rs. 46.42 lacs as estimated by the company. Pending the final settlement, this has been shown as an "Insurance Claim Receivable" under "Loans & Advances. The difference, if any, on settlement of claim will be effected in Profit and Loss account.

3 Contingent Liabilities not provided for:

INR- Lacs Year ended March 31, 2010 2009 A Claim against the Company not acknowledged as debts 28 0

B The company has imported certain capital equipments at concessional rate of custom duty under "Export Promotion Capital Goods scheme" of the Central Government. The Company has undertaken an incremental export obligation to the extent of US$24.33 Lacs { equivalent to Rs. 992.64 Lacs approx.} [Previous Year US $ 24.33 Lacs { Equivalent to Rs.992.64 Lacs ] to be fulfilled during a specified period as applicable from the date of imports. The liability towards custom duty payable thereon in respect of unfulfilled export obligation as on 31st March,2010 of Rs.124.08 Lacs [as at 31-03-09-Rs.124.08 Lacs] is not provided for as the time has yet to expire for fulfilling such export obligation. 124 124

152 124

4 Segment Information :

The company operates in one segment only, namely "Consumer Products." The Company has only one plant located in Gujarat and the company sells its products in India. Hence, there is no geographical segment also. Therefore, the segment reporting is not applicable.

5 Related Party Transactions :

A Name of the Related Party and Nature of the Related Party Relationship : a Holding Company : Cadila Healthcare Limited b Fellow Subsidiaries:

Liva Healthcare Limited Zydus Healthcare S. A. [Pty] Limited. [South Africa]

German Remedies Limited Zydus International Pvt. Limited. [Ireland]

Zydus Technologies Limited Nippon Universal Pharmaceutical Company Limited [Japan]

Dialforhealth India Limited Zydus Healthcare (USA) LLC [USA]

Dialforhealth Unity Limited Zydus France SAS [France]

Dialforhealth Greencross Limited Zydus Noveltech Inc. [USA]

Zydus Pharmaceuticals Limited Zydus IntRus Limited, [ Russia ]

Zydus Animal Health Limited Quimica E Pharmaceutica Nikkho Do, Brasil Ltda.

[Brazil]

M/s Zydus Healthcare, Sikkim Zydus Netherlands B. V. [The Netherlands]

- a Partnership Firm

Zydus Healthcare Brasil Ltda [Brazil] Laboratories Combix S.L. [Spain]

Zydus Pharmaceuticals USA Inc. [USA] Etna Biotech S.R.L., [Italy]

Simayla Pharmaceuticals (Pty.) Limited, ZC Pharma Services Pty. Ltd. South Africa [South Africa ]

6 A Provision for product warranty claims in respect, of products sold during the year is made on the basis of managements estimations of probable claims of customers in respect thereof considering the estimated stock lying with retailers. The company does not expect any reimbursement of such claim in future.

7 Deferred Tax:

A The Net Deferred tax Assets of Rs. 76 [ Previous Year - Liabilities of Rs. 79 ] Lacs for the year has been reversed in the Profit and Loss Account.

8 Disclosure pursuant to Accounting Standard -15 [ Revised ] Employee Benefits:

A Defined benefit plan and long term employment benefit

a General description :

Gratuity [ Defined benefit plan j ;

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on death or resignation or retirement at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy

Privilege Leave [ Long term employment benefit ]

The Leave encashment scheme is administered through Life Insurance Corporation of Indias "Employees Group Leave Encashment-cum-Life Assurance (Cash Accumulation) Scheme". The employees of the Company are entitled to leave as per the leave policy of the Company. The liability on account of the accumulated leave as on last day of the accounting year is recognised (net of the fair value of planned assets as at the balance sheet date) at the present value of the defined obligation at the balance sheet date based on the actuarial valuation carried out by an independent actuary using projected unit credit method.