Notes to Accounts of Sequent Scientific Ltd.

Mar 31, 2025

xi. Provisions and contingent liabilities

Provisions are recognised when the Company
has a present obligation (legal or constructive)
as a result of a past event, it is probable
that an outflow of economic benefits will be
required to settle the obligation, and a reliable
estimate can be made of the amount of the
obligation.

The amount recognised as a provision is the
best estimate of the consideration required
to settle the present obligation at the end of
each reporting period, taking into account
the risks and uncertainties surrounding the
obligation.

When some or all of the economic benefits
required to settle a provision are expected
to be recovered from a third party, the
receivable is recognised as an asset, if it is
virtually certain that reimbursement will be
received and the amount of the receivable
can be measured reliably.

Contingent liabilities are disclosed when
there is a possible obligation arising from
past events, the existence of which will be
confirmed only by the occurrence or non¬
occurrence of one or more uncertain future
events not wholly within the control of the
Company or a present obligation that arises
from past events where it is either not probable
that an outflow of resources will be required
to settle the obligation or a reliable estimate
of the amount cannot be made. Contingent
assets are not recognised but are disclosed in
the notes to standalone financial statements
when economic inflow is probable.

xii. 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.

Financial assets and financial liabilities are
recognised when an entity becomes a party to
the contractual provisions of the instruments.

All financial instruments are initially measured
at fair value. Transaction costs that are

attributable to the acquisition or issue of
the financial assets and financial liabilities
(other than financial assets recorded at fair
value through profit or loss) are added to or
deducted from the fair value of the financial
assets or financial liabilities as appropriate,
on initial recognition. Transaction cost directly
attributable to the acquisition or issue of
financial assets or financial liabilities at fair
value through profit or loss are recognised
immediately in the standalone statement of
profit and loss.

Purchase 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 trade) are
recognised on trade date.

For the purpose of subsequent measurement,
financial instruments of the Company are
classified in the following categories: non¬
derivative financial assets comprising
amortised cost, debt instruments at fair value
through other comprehensive income (FVTOCI),
equity instruments at fair value through other
comprehensive income (FVTOCI) and fair value
through profit or loss (FVTPL), non-derivative
financial liabilities at amortised cost or FVTPL
and derivative financial instruments (under
the category of financial assets or financial
liabilities) at FVTPL.

The classification of financial instruments
depends on the objective of the business
mod el for which it is held. Management
determines the classification of its financial
instruments at initial recognition.

a) Non-derivative financial assets

(i) Financial assets at amortised cost

A financial asset is measured at amortised
cost if both of the following conditions are
met:

(a) The financial asset is held within a
business model whose objective is to hold
financial assets in order to collect contractual
cash flows, and

(b) The contractual terms of the financial
asset give rise on specified dates to cash flows
that are solely payments of principal and
interest on the principal amount outstanding.

Financial assets are measured initially
at fair value plus transaction costs and
subsequently carried at amortised cost using
the effective interest rate (''EIR'') method, less
any impairment loss.

Financial assets at amortised cost are
represented by trade receivables, security
deposits, cash and cash equivalents,
employee and other advances and eligible
current and non-current assets.

(ii) Equity instruments at fair value through
other comprehensive income (FVTOCI)

All equity instruments other than investment in
subsidiaries are measured at fair value. Equity
instruments held for trading is classified as
fair value through profit or loss (FVTPL). For
all other equity instruments, the Company
may make an irrevocable election to present
subsequent changes in the fair value in OCI.
The Company makes such election on an
instrument-by-instrument basis.

If the Company decides to classify an
equity instrument as at FVTOCI, then all fair
value changes on the instrument, excluding
dividend are recognised in OCI. There is no
recycling of the amount from OCI to the
standalone statement of profit and loss,
even on sale of the instrument. However the
Company may transfer the cumulative gain
or loss within the equity.

(iii) Financial assets at fair value through
profit or loss (FVTPL)

FVTPL is a residual category for financial assets.
Any financial asset which does not meet the
criteria for categorisation as at amortised cost
or as FVTOCI, is classified as FVTPL.

In addition, the Company may elect to
designate the financial asset, which otherwise
meets amortised cost or FVTOCI criteria, as
FVTPL if doing so eliminates or significantly
reduces a measurement or recognition
inconsistency.

Financial assets included within the FVTPL
category are measured at fair values with all
changes in the standalone statement of profit
and loss.

(iv) Derecognition of financial assets

The Company derecognises a financial asset
when the contractual rights to the cash flows
from the asset expire, or the financial assets
is transferred and the transfer qualifies for
derecognition. On derecognition of a financial
asset in its entirety, the difference between
the carrying amount (measured at the date
of derecognition) and the consideration
received (including any new assets obtained
less any new liability assumed) shall be
recognised in the standalone statement of

the profit and loss except for debt and equity
instruments carried through FVTOCI which
shall be recognised in OCI.

b) Non-derivative financial liabilities

(i) Financial liabilities at amortised cost

Financial liabilities at amortised cost
represented by trade and other payables
are initially recognised at fair value, and
subsequently carried at amortised cost using
the EIR method.

(ii) Financial liabilities at fair value through
profit or loss (FVTPL)

Financial liabilities at FVTPL are measured at
fair value with all changes recognised in the
standalone statement of profit and loss.

iii) Derecognition of financial liabilities

The Company derecognises financial
liabilities only when, the obligations are
discharged, cancelled or have expired. The
difference between the carrying amount of
the financial liability derecognised and the
consideration paid and payable is recognised
in the standalone statement of profit and loss.

c) Derivative financial instruments

The Company holds derivative financial
instruments such as foreign exchange
forward contracts to mitigate the risk of
changes in foreign exchange rates on foreign
currency assets or liabilities. Derivatives
are recognised and measured at fair value.
Attributable transaction cost are recognised
in the standalone statement of profit and loss.

xiii. Impairment

a) Financial assets

I n accordance with Ind AS 109 - Financial
Instruments, the Company applies expected
credit loss (ECL) model for measurement
and recognition of impairment loss. The
Company follows ''simplified approach'' for
recognition of impairment loss allowance on
trade receivable. The application of simplified
approach does not require the Company
to track changes in credit risk. Rather, it
recognises impairment loss allowance based
on lifetime ECLs at each reporting period,
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.

Lifetime ECLs are the expected credit losses
resulting from all possible default events over
the expected life of a financial instrument.

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 shortfalls), discounted at the original
EIR. When estimating the cash flows, an entity
is required to consider:

(i) All contractual terms of the financial
instrument (including prepayment, extension
etc.) over the expected life of the financial
instrument. However, in rare cases when
the expected life of the financial instrument
cannot be estimated reliably, then the entity
is required to use the remaining contractual
term of the financial instrument;

(ii) Cash flows from the sale of collateral
held or other credit enhancements that are
integral to the contractual terms.

As a practical expedient, the Company uses
a provision matrix to determine impairment
loss on portfolio of its trade receivable. The
provision matrix is based on its historically
observed default rates over the expected life
of the trade receivable and is adjusted for
forward- looking estimates. At every reporting
date, the historical observed default rates
are updated and changes in forward-looking
estimates are analysed.

ECL impairment loss allowance (or reversal)
recognised during the period is recognised as
income / expense in the statement of profit
and loss. This amount is reflected under
the head other expenses in the standalone
statement of profit and loss. The balance
sheet presentation for various financial
instruments is described below:

Financial assets measured at amortised
cost, 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. The allowance
reduces the net carrying amount. Until the
asset meets write off criteria, the Company
does not reduce impairment allowance from
the gross carrying amount.

b) Non-financial assets

The Company assesses, at each reporting
date, whether there is an indication that
an asset may be impaired. If any indication
exists, or when annual impairment testing for

an asset is required, the Company estimates
the asset''s recoverable amount. An asset''s
recoverable amount is the higher of an asset''s
or cash-generating unit''s (CGU) fair value less
costs of disposal and its value in use.

An impairment loss is recognised in the
Statement of Profit and Loss to the extent,
asset''s carrying amount exceeds its
recoverable amount. The recoverable amount
is higher of an asset''s fair value less cost
of disposal and value in use. Value in use is
based on the estimated future cash flows,
discounted to their present value using pre¬
tax discount rate that reflects current market
assessments of the time value of money and
risk specific to the assets. For the purpose of
assessing impairment, assets are grouped at
the lowest levels into cash generating units
for which there are separately identifiable
cash flows.

An impairment loss recognised in prior years
are reversed if there has been a change in the
estimates used to determine the recoverable
amount. An impairment loss is reversed
only to the extent that the asset''s carrying
amount does not exceed the carrying amount
that would have been determined, net of
depreciation or amortisation, if no impairment
had been recognised in previous year

xiv. Earnings per share (EPS)

Basic EPS is computed by dividing the net
profit for the period attributable to the
equity shareholders by the weighted average
number of equity shares outstanding during
the period.

Diluted EPS is computed by dividing the net
profit after tax by the weighted average
number of equity shares considered for
deriving basic EPS and also weighted average
number of equity shares that could have
been issued upon conversion of all dilutive
potential equity shares. Dilutive potential
equity shares are deemed converted as of
the beginning of the period, unless issued at
a later date. Dilutive potential equity shares
are determined independently for each period
presented. The number of equity shares and
potentially dilutive equity shares are adjusted
for bonus shares, as appropriate.

xv. Leases

The Company assesses at contract inception
whether a contract is, or contains, a lease.
That is, if the contract conveys the right to
control the use of an identified asset for a

period of time in exchange for consideration.
The determination of whether an arrangement
is,or contains, a lease is based on the
substance of the arrangement at the inception
of the lease. The arrangement is, or contains,
a lease if fulfilment of the arrangement is
dependent on the use of a specific asset or
assets and the arrangement conveys a right
to use the asset or assets, even if that right
is not explicitly specified in an arrangement.

Company as a lessee

The Company applies a single recognition
and measurement approach for all leases,
except for short-term leases and leases of
low-value assets. The Company recognises
lease liabilities to make lease payments and
right-of-use assets representing the right to
use the underlying assets.

i) Right-of-use assets (ROU)

The Company recognises right-of-use
assets at the commencement date of the
lease (i.e., the date the underlying asset is
available for use). Right-of-use assets are
measured at cost, less any accumulated
depreciation and impairment losses,
and adjusted for any remeasurement
of lease liabilities. The cost of right-of-
use assets includes the amount of lease
liabilities recognised, initial direct costs
incurred, and lease payments made at
or before the commencement date less
any lease incentives received. Right-of-
use assets are depreciated on a straight¬
line basis over the of the lease term.
If ownership of the leased asset
transfers to the Company at the end
of the lease term or the cost reflects
the exercise of a purchase option,
depreciation is calculated using the
estimated useful life of the asset.
The right-of-use assets are also subject
to impairment. Refer to the accounting
policies (xiii)(b) Impairment of non¬
financial assets.

Right-of-use assets are depreciated on a
straight-line basis over the shorter of the
lease term and the estimated useful lives
of the assets, as follows:

Company as a lessor

Leases in which the company does not transfer
substantially all the risks and rewards incidental
to ownership of an asset are classified as
operating leases. Rental income arising is
accounted for on a straight-line basis over
the lease terms. Initial direct costs incurred
in negotiating and arranging an operating
lease are added to the carrying amount of the
leased assets and recognised over the lease
terms on the same basis as rental income.

ii) Lease liabilities

At the commencement date of the lease,
the Company recognises lease liabilities
measured at the present value of lease
payments to be made over the lease term.
The lease payments include fixed payments
(including in substance fixed payments)
less any lease incentives receivable,
variable lease payments that depend on
an index or a rate, and amounts expected
to be paid under residual value guarantees.
In calculating the present value of
lease payments, the Company uses its
incremental borrowing rate at the lease
commencement date because the interest
rate implicit in the lease is not readily
determinable. After the commencement
date, the amount of lease liabilities
is increased to reflect the accretion
of interest and reduced for the lease
payments made. In addition, the carrying
amount of lease liabilities is remeasured
if there is a modification, a change in the
lease term, a change in the lease payments
(e.g., changes to future payments resulting
from a change in an index or rate used
to determine such lease payments) or a
change in the assessment of an option to
purchase the underlying asset.

iii) Short-term leases and leases of low-
value assets:

The Company applies the short-term
lease recognition exemption to its short¬
term leases of office premises (i.e., those
leases that have a lease term of 12
months or less from the commencement
date and do not contain a purchase
option). It also applies the lease of low-
value assets recognition exemption to
leases that are considered to be low
value. Lease payments on short-term
leases and leases of low-value assets are
recognised as expense on a straight-line
basis over the lease term.

xvi. Cash and cash equivalents

Cash and cash equivalent in the balance
sheet comprise cash at banks and on hand
and short-term deposits with an original
maturity of three months or less, that are
readily convertible to a known amount of cash
and which are subject to an insignificant risk
of changes in value.

xvii. Cash Dividend

The Company recognises a liability to pay
dividend to equity holders of the Company
when the distribution is authorised and the
distribution is no longer at the discretion of the
Company. As per the corporate laws in India, a
distribution is authorised when it is approved
by the shareholders. A corresponding amount
is recognised directly in equity.

xviii. 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:

• I n the principal market for the asset or
liability or

• 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.

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 standalone
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:

• Level 1 — Quoted (unadjusted) market
prices in active markets for identical
assets or liabilities

• Level 2 — Valuation techniques for which
the lowest level input that is significant
to the fair value measurement is directly
or indirectly observable

• 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.

For the purpose of fair value disclosures, the
Company has determined classes of assets
and liabilities on the basis of the nature,
characteristics and risks of the asset or
liability and the level of the fair value hierarchy
as explained above.

xix. Exceptional items

Exceptional items include income or expense
that are considered to be part of ordinary
activities, however, are of such significance
and nature that separate disclosure
enables the user of Financial Statements to
understand the impact in a more meaningful
manner. Exceptional items are identified by
virtue of either their size or nature so as to
facilitate comparison with prior periods and
to assess underlying trends in the financial
performance of the Company

xx. Accounting and reporting of information for
Operating Segments

Based on "Management Approach" as defined
in Ind AS 108 - Operating Segments, the
Chief Operating Decision Maker evaluates
the Company''s performance and allocates
the resources based on an analysis of
various performance indicators by business
segments. The Company prepares its
segment information in conformity with the
accounting policies adopted for preparing
and presenting the financial statements of the
Company as a whole. Geographical segments
are ascertained based on the geographical
location of the customers.

2.5 Use of estimates and management judgments

I n application of the accounting policies, which
are described in note 2.4, the management of
the Company is required to make judgements,
estimates and assumptions about the carrying
amounts of assets and liabilities that are not readily
apparent from other sources. The estimates and
assumptions are based on historical experience and
other factors that are considered to be relevant.
Actual results may differ from these estimates.

The estimates and underlying assumptions
are reviewed on an ongoing basis. Revisions
to accounting estimates are recognised in the
period in which the estimates are revised if the
revision affects only that period, or in the period
of revision and future periods if the revision affects
both current and future periods. In particular,
information about significant areas of estimation,
uncertainty and critical judgements used in
applying accounting policies that have the most
significant effect on the amounts recognised in
the standalone financial statements is included in
the following notes:

i. Useful life of property, plant and equipment
and intangible assets

The useful life of the assets are determined in
accordance with Schedule II of the Companies
Act, 2013. In cases, where the useful life is
different from that or is not prescribed in
Schedule II, it is based on technical advice,
taking into account amongst other things, the
nature of the asset, the estimated usage of the
asset, the operating conditions of the asset,
past history of replacement, anticipated
technological changes, manufacturers
warranties and maintenance.

ii. Impairment

An impairment loss is recognised for the
amount by which an asset''s / investments
or cash-generating unit''s carrying amount
exceeds its recoverable amount. To determine
the recoverable amount, management
estimates expected discounted future cash
flows from each asset or cash-generating unit.

iii. Deferred tax

Deferred income tax liabilities are recognised
for all taxable temporary differences. Deferred
income tax assets are recognised to the
extent that it is probable that taxable profit
will be available against which the deductible
temporary differences, and the carry forward
of unused tax credits and unused tax losses
can be utilised.

iv. Fair value

Management uses valuation techniques
in measuring the fair value of financial
instruments where active market quotes
are not available. In applying the valuation
techniques, management makes maximum
use of market inputs and uses estimates and
assumptions that are, as far as possible,
consistent with observable data that
market participants would use in pricing
the instrument. Where applicable data is
not observable, management uses its best
estimate about the assumptions that market
participants would make. These estimates
may vary from the actual prices that would
be achieved in an arm''s length transaction at
the reporting date.

v. Post-retirement benefit plans

The obligation arising from the defined benefit
plan is determined on the basis of actuarial
assumptions which include discount rate,
trends in salary escalation and vested future
benefits and life expectancy. The discount
rate is determined with reference to market
yields at each financial year end on the
government bonds.

vi. Provisions and contingencies

The recognition and measurement of other
provisions are based on the assessment of the
probability of an outflow of resources, and
on past experience and circumstances known
at the reporting date. The actual outflow of
resources at a future date may therefore
vary from the figure estimated at end of each
reporting period.

vii. Share based payments

Estimating fair value for share-based payment
transactions requires determination of the
most appropriate valuation model, which
is dependent on the terms and conditions
of the grant. This estimate also requires
determination of the most appropriate inputs
to the valuation model including the expected
life of the share option, volatility and dividend
yield and making assumptions about them.
For the measurement of the fair value of
equity-settled transactions with employees
at the grant date, the Company uses black
scholes model Employee Share Option Plan.
The assumptions used for estimating fair
value for share-based payment transactions
are disclosed in Note 45.

Nature and purpose of Reserves

(a) Capital reserve

Capital reserves pertains to amalgamation of subsidiary company

(b) Securities premium account

Securities premium includes the difference between the face value of the equity shares and the consideration
received in respect of shares issued. The reserves can be utilized only for limited purposes such as issuance
of bonus shares in accordance with the provisions of the Companies Act, 2013.

(c) Share options outstanding account

This relate to shares granted to the employees of the Company and its subsidiaries.

(d) General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of
net income at a specified percentage in accordance with applicable regulations. The purpose of these
transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up
capital of the Company for that year, then the total dividend distribution is less than the total distributable
results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily
transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the
amount previously transferred to the general reserve can be utilised only in accordance with the specific
requirements of Companies Act, 2013.

(e) Retained earnings

Retained earnings are the profits / (loss) that the Company has earned / incurred till date, less any transfers
to general reserve and dividends or other distributions paid to shareholders.

(f) Reserve for equity instruments through other comprehensive income

Reserve for equity instruments through other comprehensive income represents the cumulative gains (net
of losses) arising on revaluation of equity instruments measured at fair value through other comprehensive
income, net of amount reclassified, if any, to retained earnings when those instruments are disposed off.

(g) Treasury reserve

Treasury reserve represents the shares of the Company held by SeQuent Scientific Employee Stock Option
Plan Trust.

Notes:

(i) Trade payables (other than due to micro, small and medium enterprises) are non-interest bearing and
are normally settled in 90 - 120 days.

(ii) The Company''s exposures to currency and liquidity risks related to trade payables is disclosed in note 49.

(iii) Refer note 44.3 for dues payable to related parties

(iv) The Company has entered into an agreement with financial institutions for the supply chain financing
arrangement. As per the arrangement, the suppliers may elect to factor their receivable from the
Company and receive the payment due from the financial institutions before the due date. As per the
arrangement, the financial institutions agrees to pay amounts which Company owes to it''s suppliers
and the Company agrees to pay the financial institutions at a date later than suppliers are paid.

The nature and function of the liabilities remain the same even after factoring as the Company is
neither legally released from its original obligation to the supplier nor the terms of the original liability
are amended in a way that is considered a substantial modification. Hence, the Company has not
derecognised the liabilities which are factored by the suppliers and disclosed the said amount within
trade payables. Further, no additional interest has been paid to the financial institution by the Company
on the amounts due to the suppliers. The payable under supply chain financing arrangement amounts
to '' 19.06 million as at 31 March 2025 (31 March 2024: '' 119.78 million).

Apart from the above, the Company has also entered into arrangements, wherein the Company
requests the financial institutions to make payments on the due date agreed with the suppliers and
the Company pays to the financial institutions at the end of the extended period of payment. In this
case, the Company derecognizes the liabilities towards the suppliers on the date of payment by the
financial institutions to the suppliers and recognizes the amounts paid within Borrowings. During the
year ended March 31, 2025, the Company has recognized interest expense amounting to '' 15.26 million
(31 March 2024: '' 10.75 million) under the aforementioned arrangement. The payable to the financial
institution amounts to '' 241.16 million as at 31 March 2025 (31 March 2024: '' 152.69 million) under this
arrangement which has been recognized under "Short Term Borrowings" in the financial statements.

Note:

(a) The Board of Directors of the Company at their meeting held on 26 September 2024 have approved the
Composite Scheme of Amalgamation (the Scheme) amongst the Company, Sequent Research Limited (wholly
owned subsidiary of the Company), Viyash Life Sciences Private Limited, Symed Labs Limited, Vandana Life
Sciences Private Limited, Appcure Labs Private Limited, Vindhya Pharma (India) Private Limited, SV Labs
Private Limited, Vindhya Organics Private Limited, Genin Life Sciences Private Limited in terms of Section
230-232 and other applicable provisions of Companies Act, 2013. The Scheme would become effective after
receipt of all requisite approval. Pending receipt of necessary approvals, no effect of the Scheme has been
given in the financial statement for the year ended 31 March 2025. In this regard, the Company has incurred
transaction costs pertaining to Scheme amounting to ''52.61 million for the year ended 31 March 2025.

(b) During the year ended 31 March 2025, based on confirmation from vendor, the Company has reversed provision
by ''3.80 million related to domain expert advisory fees towards revamping of manufacturing and procurement
processes, in respect of which expense of ''34.22 million was recorded for the year ended 31 March 2024.
Further, during the year ended 31 March 2024, the Company had incurred the following non-recurring
expenses towards restructuring of its operations by closing its API manufacturing facility at MIDC, Tarapur,
Maharashtra :

(i) Provision for diminution in value of immovable assets at Tarapur manufacturing facility aggregating to
''19.74 million.

(ii) Settlement payment to the employees at Tarapur manufacturing facility aggregating to ''8.58 million.

(D) The Company has not opted for section 115BAA introduced under Taxation Law (Amendment)
Ordinance, 2019, considering the accumulated MAT credit and other benefits available under the
Income Tax Act, 1961.

40 Employee benefit plans

(i) Defined contribution plans:

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are
defined contribution plans, for qualifying employees. Under the schemes, the Company is required to
contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised
'' 12.82 (31 March 2024 : '' 13.01) for Provident Fund contributions and '' 1.21 (31 March 2024 : '' 1.48) for
Employee State Insurance Scheme contributions in the standalone statement of profit and loss. As at
31 March 2025, contribution of ''2.25 (31 March 2024 : ''2.08) is outstanding which is paid subsequent
to the end of respective reporting periods.

Notes:

(i) Refer note 2.4(xviii) under Material accounting policies for recognition and measurement of financial assets.

(ii) The fair value of the investments in equity is based on the quoted price.

(iii) Price risk- The Company''s listed and non-listed equity securities are susceptible to market price risk arising
from uncertainties about future values of the investment securities.

49.2 Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, trade payables and other payables.
The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal
financial assets include investments, loans, trade and other receivables, cash and deposits that are derived
directly from its operations.

The Company is exposed to the following risks from its use of financial instruments:

- Credit risk

- Liquidity risk

- Market risk

This note presents information about the Company''s exposure to each of the above risks, the Company''s
objectives, policies and processes for measuring and managing risk, and the Company''s management of capital.
Further quantitative disclosures are included throughout these standalone financial statements.

Risk management framework

The Company''s activities makes it susceptible to various risks. The Company has taken adequate measures to
address such concerns by developing adequate systems and practices. The Company''s overall risk management
program focuses on the unpredictability of markets and seeks to manage the impact of these risks on the
Company''s financial performance.

The Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk
management framework.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company,
to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies
and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The

49.2 Financial risk management objectives and policies (Contd)

Company, through its training and management standards and procedures, aims to develop a disciplined and
constructive control environment in which all employees understand their roles and obligations.

The Company has established Audit Committee and its constitution, quorum and scope is in line with the
Companies Act, 2013, provisions of Listing Agreement as entered with the Stock Exchange / Regulations.

The Audit Committee oversees how management ensures compliance of Internal Control Systems, compliance
with the Company''s risk management policies and procedures, and reviews the adequacy of the risk management
framework in relation to the risks faced by the Company.

The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular
and adhoc reviews of risk management controls and procedures, the results of which are reported to the Audit
Committee.

The Audit Committee also reviews the adequacy of internal audit function, including the structure of the internal
audit department, staffing and seniority of the official heading the department, reporting structure coverage
and frequency of internal audit In order to ensure that all checks and balances are in place and all internal
control systems are in order, regular and exhaustive internal audits are conducted by experienced firms of
Chartered Accountants.

49.3 Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument
fails to meet its contractual obligations resulting in a financial loss to the Company. Credit risk arises principally
from the Company''s trade receivables. Credit risk arises from cash held with banks and financial institutions,
as well as credit exposure to customers, including outstanding accounts receivable. The maximum exposure to
credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit
risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking
into account their financial position, past experience and other factors.

The Company''s trade and other receivables are actively monitored to review credit worthiness of the customers
to whom credit terms are granted and also avoid significant concentrations of credit risks.

- The Company continuously monitors defaults of customers and other counterparties identified and incorporates
this information into its credit risk controls.

- Trade receivables consist of a large number of customers spread across diverse industries and geographical
areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable and where
appropriate, credit guarantee insurance cover is purchased for export customers.

- The Company limits its exposure to credit risk by generally investing in liquid securities and only with
counterparties that have a good credit rating.

Information about major customer

Revenue from single external customer group is approximately '' 283.28 (31 March 2024: '' 202.23) representing
17% (31 March 2024: 13%) of Company''s total revenue from business for the year ended 31 March 2025 and total
exposure in receivables is 3% for the year ended 31 March 2025 (31 March 2024: 20%). Apart from the aforesaid
single customer, the Company does not have a significant credit risk exposure to any other single counterparty.

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by
the company. The Company''s maximum exposure in this respect is the maximum amount the Company may have
to pay if the guarantee is called on. These financial guarantees have been issued to banks and other parties with
whom loan agreements have been entered by the subsidiary (refer note 44.3 for details of outstanding financial
guarantees).

49.4 Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its
financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to
managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities
when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage
to the Company''s reputation.

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

The Company''s treasury department is responsible for managing the short-term and long-term liquidity
requirements of the Company. Short-term liquidity situation is reviewed on a regular basis by the treasury
function within the Company. Long-term liquidity position is reviewed on a regular basis by the Board of Directors
and appropriate decisions are taken according to the situation.

Typically the Company ensures that it has sufficient funds on demand to meet expected operational expenses
for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of
extreme circumstances that cannot reasonably be predicted, such as natural disasters.

The table below provides details regarding the contractual maturities of significant financial liabilities as at 31
March 2025 and 31 March 2024:

49.5 Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity
prices will affect the Company''s income or the value of its holdings of financial instruments. The objective of
market risk management is to manage and control market risk exposures within acceptable parameters, while
optimising the return.

The Company is exposed to interest rate risk arising mainly from debt. The Company is exposed to interest rate
risk because the fair value of fixed rate borrowings and the cash flows associated with floating rate borrowings
will fluctuate with changes in interest rates.

The Company is also exposed to foreign currency risk on certain transactions that are denominated in a currency
other than the Company''s functional currency; hence exposures to exchange rate fluctuations arise. Considering
the country and economic environment in which the Company operates, its operations are subject to risks arising
from fluctuations in exchange rate in those countries. The risk is that the functional currency value of cash flows
will vary as a result of movements in exchange rates.

50 Capital Management

For the purpose of Company''s capital management, capital includes issued equity capital and all other equity
reserves attributable to the equity share holders of the Company. The primary objective of the Company''s
capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions
and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may
adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company
monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company
includes within net debt, interest bearing borrowings less cash and cash equivalents

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to
ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital
structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call
loans and borrowings. As at 31 March 2025, there is no breach of covenant attached to the borrowings.

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

The capital structure of the Company consists of net debt (offset by cash and bank balances) and total equity
of the Company.

Note:

The provisions of Section 135 of the Companies Act, 2013 for Corporate Social Responsibility (CSR) are applicable
to the Company. Basis the assessment of spend criteria as defined in the section, the Company is not required
to spend on CSR for the current year considering the average net loss incurred in preceding three years.

52 The Company does not have any Benami property, where any proceeding has been initiated or pending
against the Company for holding any Benami property under the Benami Transaction Prohinition Act, 1988
and rules made thereunder.

53 There is no income surrendered or disclosed as income during the current or previous year in the tax
assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

54 The Company does not have any charges or satisfaction which are yet to be registered with Registrar of
Companies beyond the statutory period.

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

57 The Company has not been declared as wilful defaulter by any bank or financial institution or government
or any government authority.

58 The Company has complied with the number of layers of subsidiaries prescribed under Section 2(87) of the
Companies Act, 2013

59 The quarterly returns or statements of current assets filed by the Company (including revised returns or
statements) with banks or financial institutions are in agreement with the books of accounts.

60 A. During the year ended 31 March 2025, the Company has not advanced or loaned or invested funds to
any other persons or entity, including foreign entities (Intermediaries) with the understanding that the
Intermediary shall:

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

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

B. During the year ended 31 March 2025, the Company has not received any fund from any persons or entity,
including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise)
that the Company shall

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by
or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

61 The Company has used two accounting software for maintaining its books of account which have 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 audit trail feature is not enabled for certain changes
made, if any, using privileged / administrative access rights to the underlying database. Further no instance
of audit trail feature being tampered with was noted in respect of these software. Additionally, the audit
trail of prior year has been preserved by the Company as per the statutory requirements for record retention
to the extent it was enabled and recorded in the respective years.

62 With effect from August 5, 2022, the Ministry of Corporate Affairs (MCA) has amended the Companies
(Accounts) Rules, 2014, relating to maintenance of electronic books of account and other relevant books
and papers. Pursuant to this amendment, the Company has maintained the books of account which are
accessible in India at all times and their backup is kept on servers located in India on a daily basis, except
that backup was not performed on June 19, 2024.

63 The new and amended standards and interpretations that are issued, but not yet effective, up to the date
of issuance of the Company''s financial statements are disclosed below. The Company will adopt this new
and amended standard, when it become effective.

Lack of exchangeability - Amendments to Ind AS 21

The Ministry of Corporate Affairs notified amendments to Ind AS 21 The Effects of Changes in Foreign
Exchange Rates to specify how an entity should assess whether a currency is exchangeable and how it
should determine a spot exchange rate when exchangeability is lacking. The amendments also require
disclosure of information that enables users of its financial statements to understand how the currency
not being exchangeable into the other currency affects, or is expected to affect, the entity''s financial
performance, financial position and cash flows.

The amendments are effective for annual reporting periods beginning on or after 1 April 2025. When applying
the amendments, an entity cannot restate comparative information.

The amendments are not expected to have a material impact on the Company''s financial statements.

64 The figures for the corresponding previous year have been regrouped/reclassified wherever necessary, to
make them comparable.

65 The standalone financial statements were approved for issue by the board of directors on 20 May 2025.

As per our report of even date attached

For S R B C & CO LLP For and on behalf of the Board of Directors

Chartered Accountants

ICAI firm registration number- 324982E / E300003

Per Anil Jobanputra Rajaram Narayanan Vedprakash Ragate

Partner Managing Director & Whole-time Director

Membership No: 1 10759 Chief Executive Officer DIN:10578409

DIN:02977405

Saurav Bhala Yoshita Vora

Chief Financial Officer Company Secretary

Thane, 20 May 2025 Membership No: A-22220

---

Mar 31, 2024

(ii) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of ''2 per share. Each holder of equity shares is entitled to one vote per share. Each equity shareholder is entitled to dividend in the Company. The dividend proposed by board of directors is subject to approval of the shareholders in the ensuing annual general meeting, except in case of interim dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of Reserves

(a) Capital reserve

Capital reserves pertains to amalgamation of subsidiary company.

(b) Securities premium account

Securities premium includes the difference between the face value of the equity shares and the consideration received in respect of shares issued. The reserves can be utilized only for limited purposes such as issuance of bonus shares in accordnace with the provisions of the Companies Act, 2013.

(c) Share options outstanding account

This relate to shares granted to the employees of the Company and its subsidiaries.

(d) General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

(e) Retained earnings

Retained earnings are the profits / (loss) that the Company has earned / incurred till date, less any transfers to general reserve and dividends or other distributions paid to shareholders.

(f) Reserve for equity instruments through other comprehensive income

Reserve for equity instruments through other comprehensive income represents the cumulative gains (net of losses) arising on revaluation of equity instruments measured at fair value through other comprehensive income, net of amount reclassified, if any, to retained earnings when those instruments are disposed off.

(g) Treasury reserve

Treasury reserve represents the shares of the Company held by SeQuent Scientific Employee Stock Option Plan Trust.

(i) Trade payables (other than due to micro, small and medium enterprises) are non-interest bearing and are normally settled in 90 - 120 days.

(ii) The Company''s exposures to currency and liquidity risks related to trade payables is disclosed in note 50.

(iii) Refer note 45.3 for dues payable to related parties.

(iv) The Company has entered into an agreement with financial institutions for the supply chain financing arrangement. As per the arrangement, the suppliers may elect to factor their receivable from the Company and receive the payment due from the financial institutions before the due date. As per the arrangement, the financial institutions agrees to pay amounts which Company owes to it''s suppliers and the Company agrees to pay the financial institutions at a date later than suppliers are paid.

The nature and function of the liabilities remain the same even after factoring as the Company is neither legally released from its original obligation to the supplier nor the terms of the original liability are amended in a way that is considered a substantial modification. Hence, the Company has not derecognised the liabilities which are factored by the suppliers and disclosed the said amount within trade payables. Further, no additional interest has been paid by the Company on the amounts due to the suppliers. The payable under supply chain financing arrangement amounts to '' 119.78 million as at 31 March 2024 (31 March 2023: '' 69.25 million).

Apart from the above, the Company has also entered into arrangements wherein the financial institutions to smoothen the payment process of the suppliers, wherein the Company requests the financial institutions to make payments on the due date agreed with the suppliers and the Company pays to the financial institutions at the end of the extended period of payment. In this case, the Company derecognizes the liabilities towards the suppliers on the date of payment by the financial institutions to the suppliers and recognizes the amounts paid within Borrowings. During the year ended 31 March 2024, the Company has recognized interest expense amounting to '' 10.75 million under the aforementioned arrangement. The payable to the financial institution amounts to '' 152.69 million under this arrangement which has been recognized under "Short Term Borrowings" in the financial statements as at 31 March 2024.

During the year ended 31 March 2024, the Company decided to restructure the operations by closing one of its API manufacturing facility at MIDC, Tarapur, Maharashtra and relocated its sourcing from new facilities. Further, as part of operations restructuring drive, the Company has revamped the manufacturing and procurement processes at its API manufacturing facilities in India with the objective of network optimization and cost reduction. In this regard, the Company has incurred the following non-recurring expenses;

(a) Domain expert advisory fees towards revamping of manufacturing and procurement processes estimating to ''34.22 millions.

(b) Provision for diminution in value of immovable assets at Tarapur manufacturing facility aggregating to ''19.74 millions

(c) Settlement payment to the employees at Tarapur manufacturing facility aggregating to ''8.58 millions.

(D) The Company has not opted for section 115BAA introduced under Taxation Law (Amendment) Ordinance, 2019, considering the accumulated MAT credit and other benefits available under the Income Tax Act, 1961.

41 Employee benefit plans

(i) Defined contribution plans:

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised '' 13.01 (31 March 2023 : '' 13.70) for Provident Fund contributions and '' 1.48 (31 March 2023 : ''1.74) for Employee State Insurance Scheme contributions in the standalone statement of profit and loss. As at 31 March 2024, contribution of ''2.08 (31 March 2023 : '' 2.20) is outstanding which is paid subsequent to the end of respective reporting periods.

Sensitivity Analysis

The sensitivity analyses below have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The sensitivity analyses are based on a change in a significant assumption, keeping all other assumptions constant. The sensitivity analyses may not be representative of an actual change in the defined benefit obligation as it is unlikely that changes in assumptions would occur in isolation from one another.

42 Contingent liabilities and commitments (to the extent not provided for)
	As at 31 March 2024	As at 31 March 2023
Contingent liabilities
Indirect tax matters	0.12	-
Commitments
Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances)
- Property, plant and equipment	11.25	36.00
Corporate Guarantee given to lenders for loan facility availed by wholly owned subsidiary	2,833.1 1	2,627.1 1

Dues to micro and small enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management based on enquiries made by the Management with the creditors which have been relied upon by the auditors.

44 Segment Reporting

The Company has presented segment information in its Consolidated Financial Statements, which are part of the same annual report. Accordingly, in terms of provisions of Accounting Standard on Segment Reporting (Ind AS 108), no disclosure related to the segment are presented in these Standalone Financial Statements.

46 Share-based payment arrangements A. Description of share-based payment arrangements

i. Share option programmes (equity-settled)

The Company implemented "SeQuent Scientific Employees Stock Option Plan 2010" (SeQuent ESOP 2010), as approved by the Shareholders of the Company on 24 May 2010 and it was further modified by the members on 24 September 2015. Further the company has implemented "SeQuent Scientific Employees Stock Option Plan 2020" (SeQuent ESOP 2020) as approved by shareholders on 17 January 2021 which was subsequently amended in the Annual General Meeting held on 30 August, 2023 as approved by the shareholders.

The expense on Employee Stock Option plan debited to the standalone statement of profit and loss during 2023-24 is '' 74.21 (31 March 2023: '' 114.14 Net of recoveries of '' 148.59 (31 March 2023 : '' 239.97)) from its subsidiary company towards the stock options granted to subsidiary employees, pursuant to the employee stock option schemes. The entire amount pertains to equity-settled employee share-based payment plans. The share option outstanding as on 31 March 2024 is '' 773.08 (31 March 2023 : '' 562.26).

B. Measurement of fair values

Fair value of share options granted in the year

The weighted average fair value of the share options granted on 10 May 2023 ranges from ''25.81 to ''45.00 and granted on 06 November 2023 ranges from ''42.39 to ''59.24 (11 April 2022 ranges from ''73.60 to ''108.30 and granted on 25 July 2022 ranges from ''47.44 to ''66.8) Options were priced using a Black-Scholes model. The fair value of the employee share options has been measured using the Black-Scholes formula. Service and non-market performance conditions attached to the arrangements if any, were not taken into account in measuring fair value.

D. Share options outstanding at the end of the year

The share options outstanding at the end of the year had a weighted average exercise price of ''86.00 (as at 31 March 2023 : ''85.81) and weighted average remaining contractual life of 6.37 years (31 March 2023 : 6.5 years).

Notes:

(i) Refer note 2.4(xviii) under Material accounting policies for recognition and measurement of financial assets.

(ii) The fair value of the investments in equity is based on the quoted price.

(iii) Price risk- The Company''s listed and non-listed equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities.

50.2 Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, trade payables and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include investments, loans, trade and other receivables, cash and deposits that are derived directly from its operations.

The Company is exposed to the following risks from its use of financial instruments:

- Credit risk

- Liquidity risk

- Market risk

This note presents information about the Company''s exposure to each of the above risks, the Company''s objectives, policies and processes for measuring and managing risk, and the Company''s management of capital. Further quantitative disclosures are included throughout these standalone financial statements.

Risk management framework

The Company''s activities makes it susceptible to various risks. The Company has taken adequate measures to address such concerns by developing adequate systems and practices. The Company''s overall risk management program focuses on the unpredictability of markets and seeks to manage the impact of these risks on the Company''s financial performance.

The Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Company has established Audit Committee and its constitution, quorum and scope is in line with the Companies Act, 2013, provisions of Listing Agreement as entered with the Stock Exchange / Regulations. The Audit

Committee comprises of two non executive independent directors and one non-executive director nominated by the Board of Directors.

The Audit Committee oversees how management ensures compliance of Internal Control Systems, compliance with the Company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular and adhoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.

The Audit Committee also reviews the adequacy of internal audit function, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit In order to ensure that all checks and balances are in place and all internal control systems are in order, regular and exhaustive internal audits are conducted by experienced firms of Chartered Accountants.

50.3 Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations resulting in a financial loss to the Company. Credit risk arises principally from the Company''s trade receivables. Credit risk arises from cash held with banks and financial institutions, as well as credit exposure to customers, including outstanding accounts receivable. The maximum exposure to credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.

The Company''s trade and other receivables are actively monitored to review credit worthiness of the customers to whom credit terms are granted and also avoid significant concentrations of credit risks.

- The Company continuously monitors defaults of customers and other counterparties identified and incorporates this information into its credit risk controls.

- Trade receivables consist of a large number of customers spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable and where appropriate, credit guarantee insurance cover is purchased for export customers.

- The Company limits its exposure to credit risk by generally investing in liquid securities and only with counterparties that have a good credit rating.

Information about major customer

Revenue from single external customer group is approximately ''202.23 (31 March 2023: ''326.83) representing 13% (31 March 2023 : 15%) of Company''s total revenue from business for the year ended 31 March 2024 and total exposure in receivables is 20% for the year ended 31 March 2024 (31 March 2023: Nil %). Apart from the aforesaid single customer, the Company does not have a significant credit risk exposure to any other single counterparty.

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by the company. The Company''s maximum exposure in this respect is the maximum amount the Company may have to pay if the guarantee is called on. These financial guarantees have been issued to banks and other parties with whom loan agreements have been entered by the subsidiary (refer note 45.3 for details of outstanding financial guarantees).

50.4 Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.

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

The Company''s treasury department is responsible for managing the short-term and long-term liquidity requirements of the Company. Short-term liquidity situation is reviewed daily by treasury. Long-term liquidity position is reviewed on a regular basis by the Board of Directors and appropriate decisions are taken according to the situation.

Typically the Company ensures that it has sufficient funds on demand to meet expected operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

50.5 Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

The Company is exposed to interest rate risk arising mainly from debt. The Company is exposed to interest rate risk because the fair value of fixed rate borrowings and the cash flows associated with floating rate borrowings will fluctuate with changes in interest rates.

The Company is also exposed to foreign currency risk on certain transactions that are denominated in a currency other than the Company''s functional currency; hence exposures to exchange rate fluctuations arise. Considering the country and economic environment in which the Company operates, its operations are subject to risks arising

from fluctuations in exchange rate in those countries. The risk is that the functional currency value of cash flows will vary as a result of movements in exchange rates.

Foreign currency Risk:

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency).

b) Foreign currency sensitivity analysis

The Company is mainly exposed to currency fluctuation of USD.

The following table details the Company''s sensitivity to a 10% increase and decrease in the '' against the relevant foreign currencies. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for 10% change in foreign currency rates. Positive numbers below indicates an increase in profit or equity where the '' strengthens 10% against the relevant currency. For a 10% weakening of the '' against the relevant currency, there would be a comparable impact on the profit or equity, and the balance below would be negative.

In management''s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year.

50.6 Financial instrument - Risk exposure and fair value

Interest rate risk exposure

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the company''s long-term debt obligations with floating interest rates.

51 Capital Management

For the purpose of Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity share holders of the Company. The primary objective of the Company''s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing borrowings less cash and cash equivalents

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. As at 31 March 2024, there is no breach of covenant attached to the borrowings.

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

The capital structure of the Company consists of net debt (offset by cash and bank balances) and total equity of the Company.

(i) Debt is defined as long-term (including current maturity of long term borrowings excluding financial guarantee contracts) and short-term borrowings.

(ii) Other bank balance exclude the bank balance towards unpaid dividend.

(iii) Gearing ratio : Net debt / Total Equity.

53 The Company does not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

54 There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of accounts.

55 The Company does not have any charges or satisfaction which are yet to be registered with Registrar of Companies beyond the statutory period.

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

57 The Company has not been declared as wilful defaulter by any bank or financial institution or government or any government authority.

58 The Company has complied with the number of layers of subsidiaries prescribed under Section 2(87) of the Companies Act, 2013

59 The quarterly returns or statements of current assets filed by the Company (including revised returns or statements) with banks or financial institutions are in agreement with the books of accounts.

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

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

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

B. The Company has not received any fund from any persons or entity, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

61 During the year, the Company had a cyber security attack on one of it''s ancillary applications. The Company promptly acted on the incident and took steps to prevent the impact of the attack by deploying appropriate protective tools, scanning the devices and servers and corrective measures were taken on affected applications. Since the main ERP software of the Company remained unimpacted, there was no financial loss with respect to underlying financial / accounting information/data (including sales and invoicing). There was no disruption in the operations and the business had continued to operate normally as per defined processes.

62 The Company has used two accounting software for maintaining its books of account which have 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 (i) audit trail feature is not enabled for certain changes made using privileged/administrative access rights to the underlying database; (ii) in the absence of relevant information in the Service Organisation Controls report, it is not determinable whether the audit trail feature of the underlying database related to Zing HR application (used for maintaining payroll records and processing) operated throughout the year or whether there were any instances of the audit trail feature being tampered with. Further, no instance of audit trail feature being tampered with was noted in respect of SAP software.

63 There are no standards that are notified and not yet effective as on the date.

64 The figures for the corresponding previous year have been regrouped/reclassified wherever necessary, to make them comparable.

65 The standalone financial statements were approved for issue by the board of directors on 15 May 2024.

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Mar 31, 2023

Note

There are no projects whose completion is overdue.

There are no projects which have exceeded its cost as compared to its orignal plan.

*With the approval of Board of Directors, the Company has decided to sale the leasehold factory land at Ambernath (Maharashtra), which was used for manufacturing operations in the earlier years and the Company does not expect to derive any economic benefit from the said land. In this regard, the company has entered into a Memorandum of understanding for sale of lease hold rights for a consideration of ''171 million which is expected to get materialised in the current year. The carrying value of the land of ''100.92 million has been, accordingly, reclassified as Asset held for sale, in the financial statements for the year ended March 31, 2023.

1. There are no unbilled receivables, hence the same is not disclosed in the ageing schedule.

2. Trade receivables are non-interest bearing and are generally on terms of 30 to 90 days.

3. No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member except disclosed in note 45.3

4. Refer note 50.3 for term and other details.

(ii) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of '' 2 per share. Each holder of equity shares is entitled to one vote per share. Each equity shareholder is entitled to dividend in the Company. The dividend proposed by board of directors is subject to approval of the shareholders in the ensuing annual general meeting, except in case of interim dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of Reserves

(a) Capital reserve

Capital reserves pertains to amalgamation of subsidiary company

(b) Securities premium account

Securities premium includes:

i) The difference between the face value of the equity shares and the consideration received in respect of shares issued.

ii) The fair value of the stock options which are treated as expense, if any, in respect of shares allotted pursuant to Stock Options Scheme.

(c) Share options outstanding account

This relate to shares granted to the employees of the Company and its subsidiaries.

(d) General reserve

During the earlier years ,the Company had transferred a portion of the net profit of the Company before declaring dividend to general reserve.

Notes:

(i) Working capital loan from banks are secured by a exclusive charge on current assets of the company and secured by unconditional & irrevocable guarantee from subsidiary Alivira Animal Health Limited, India.

(ii) The interest on Working Capital loans are floating in nature which ranges from 5.70% to 9.00% per annum. (31 March 2022:5.70% to 7.80% per annum)

(iii) There has been no breach of covenants attached to the borrowings as at 31 March 2023.

The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

(e) Retained earnings

Retained earnings are the profits that the Company has earned till date, less any transfers to general reserve and dividends or other distributions paid to shareholders.

(f) Reserve for equity instruments through other comprehensive income

Reserve for equity instruments through other comprehensive income represents the cumulative gains (net of losses) arising on revaluation of equity instruments measured at fair value through other comprehensive income, net of amount reclassified, if any, to retained earnings when those instruments are disposed off.

(g) Treasury reserve

Treasury reserve represents the shares of the Company held by ESOP Trust.

(ii) Trade receivables and Contract Balances

The Company classifies the right to consideration in exchange for deliverables as a trade receivable. A receivable is a right to consideration that is unconditional upon passage of time. Revenue for revenue contracts are recognized at a point in time when the Company transfers control over the product to the customer.

41 Employee benefit plans

(i) Defined contribution plans:

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised '' 13.70 (31 March 2022 : ''12.88) for Provident Fund contributions and '' 1.74 (31 March 2022 : '' 1.64) for Employee State Insurance Scheme contributions in the standalone statement of profit and loss. As at 31 March 2023, contribution of '' 2.20 (31 March 2022 : '' 2.29) is outstanding which is paid subsequent to the end of respective reporting periods.

(ii) Defined benefit plans:

The Company has a defined Gratuity benefit plan. Gratuity is payable to all eligible employees of the Company on superannuation, death and resignation. The following table summarises the components of net employee benefit expenses recognised in the standalone statement of profit and loss and the funded status and amounts recognised in the balance sheet for the plan.

Sensitivity Analysis

The sensitivity analyses below have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The sensitivity analyses are based on a change in a significant assumption, keeping all other assumptions constant. The sensitivity analyses may not be representative of an actual change in the defined benefit obligation as it is unlikely that changes in assumptions would occur in isolation from one another.

42 Contingent liabilities and commitments (to the extent not provided for) As at 31 March 2023		As at 31 March 2022
Contingent liabilities
Claims against the Company not acknowledged as debts	-	-
Commitments
Estimated amount of contracts remaining to be executed on capital
account and not provided for (net of advances)
- Property, plant and equipment	36.00	6.03
Corporate Guarantee given to lenders for loan facility availed by	2,627.1 1	2,451.72
wholly owned subsidiary

46 Share-based payment arrangements

A. Description of share-based payment arrangements

i. Share option programmes (equity-settled)

The Company implemented "SeQuent Scientific Employees Stock Option Plan 2010" (SeQuent ESOP 2010), as approved by the Shareholders of the Company on 24 May 2010 and it was further modified by the member on 24 September 2015. Further the company has implemented "SeQuent Scientific Employees Stock Option Plan 2020" (SeQuent ESOP 2020) as approved by shareholders on 17 January 2021

B. Measurement of fair values

Fair value of share options granted in the year

The weighted average fair value of the share options granted on 11 April 2022 ranges from '' 73.60 to '' 108.30 and granted on 25 July 2022 ranges from '' 47.44 to '' 66.80 (22 February 2022 ranges from '' 63.58 to '' 85.45) Options were priced using a black scholes model. The fair value of the employee share options has been measured using the Black-Scholes formula. Service and non-market performance conditions attached to the arrangements if any, were not taken into account in measuring fair value.

* Pursuant to sub-division of 1 equity share of '' 10 each into 5 equity shares of '' 2 each on 26 February 2016, the no. of options have been adjusted proportionately.

D. Share options outstanding at the end of the year

The share option outstanding at the end of the year had a weighted average exercise price of '' 85.81 (as at 31 March 2022 : '' 85.41) and weighted average remaining contractual life of 6.5 years (31 March 2022 : 2.86 years).

The expense on Employee Stock Option plan debited to the standalone statement of profit and loss during 2022-23 is '' 114.14 (31 March 2022: '' 60.85) Net of recoveries of '' 239.97 (31 March 2022 : '' 272.22 ) from its subsidiary company towards the stock options granted to subsidiary employees, pursuant to the employee stock option schemes. The entire amount pertains to equity-settled employee share-based payment plans. The share option outstanding as on 31 March 2023 is '' 562.26 (31 March 2022 : '' 379.58)

50.1 Fair value hierarchy

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

The following table presents the fair value measurement hierarchy of financial assets and liabilities measured at fair value on recurring basis as at 31 March 2023 and 31 March 2022:

Notes:

(i) Refer note 2.4(xviii) under significant accounting policies for recognition and measurement of financial assets.

(ii) The fair value of the investments in equity is based on the quoted price.Derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the market place.

50 Financial instruments (Contd.)

(iii) Price risk- The Company''s listed and non-listed equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities.

50.2 Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, trade payables and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include investments, loans, trade and other receivables, cash and deposits that are derived directly from its operations.

The Company is exposed to the following risks from its use of financial instruments:

- Credit risk

- Liquidity risk

- Market risk

This note presents information about the Company''s exposure to each of the above risks, the Company''s objectives, policies and processes for measuring and managing risk, and the Company''s management of capital. Further quantitative disclosures are included throughout these standalone financial statements.

Risk management framework

The Company''s activities makes it susceptible to various risks. The Company has taken adequate measures to address such concerns by developing adequate systems and practices. The Company''s overall risk management program focuses on the unpredictability of markets and seeks to manage the impact of these risks on the Company''s financial performance.

The Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Company has established Audit Committee and its constitution, quorum and scope is in line with the Companies Act, 2013, provisions of Listing Agreement as entered with the Stock Exchange / Regulations. The Audit Committee comprises of two non executive independent directors and one non-executive director nominated by the Board of Directors.

The Audit Committee oversees how management ensures compliance of Internal Control Systems, compliance with the Company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular and adhoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.

The Audit Committee also reviews the adequacy of internal audit function, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit in order to ensure that all checks and balances are in place and all internal control systems are in order, regular and exhaustive internal audits are conducted by experienced firms of Chartered Accountants.

50.3 Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations resulting in a financial loss to the Company. Credit risk arises principally from the Company''s trade receivables. Credit risk arises from cash held with banks and financial institutions, as well as credit exposure to customers, including outstanding accounts receivable. The maximum exposure to credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit-ratings assigned by credit-rating agencies.

The Company''s trade and other receivables are actively monitored to review credit worthiness of the customers to whom credit terms are granted and also avoid significant concentrations of credit risks.

The Company continuously monitors defaults of customers and other counterparties identified and incorporates this information into its credit risk controls.

The Company limits its exposure to credit risk by generally investing in liquid securities and only with counterparties that have a good credit rating.

Trade receivables consist of a large number of customers spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable and where appropriate, credit guarantee insurance cover is purchased for export customers.

Information about major customer

Revenue from single external customer group is approximately '' 326.83 (31 March 2022 : '' 527.31) representing 15% (31 March 2022 : 24%) of Company''s total revenue from business for the year ended 31 March 2023 and total exposure in receivables is Nil % for the year ended 31 March 2023 (31 March 2022: 43%). Apart from the aforesaid single customer, the Company does not have a significant credit risk exposure to any other single counterparty."

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by the company. The Company''s maximum exposure in this respect is the maximum amount the Company may have to pay if the guarantee is called on. As at 31 March 2023, an amount of '' 2627.11 (31 March 2022 : '' 2451.72) is outstanding as financial guarantee. These financial guarantees have been issued to banks and other parties with whom loan agreements have been entered by the subsidiary.

50.4 Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.

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

The Company''s treasury department is responsible for managing the short-term and long-term liquidity requirements of the Company. Short-term liquidity situation is reviewed daily by treasury. Long-term liquidity position is reviewed on a regular basis by the Board of Directors and appropriate decisions are taken according to the situation.

Typically the Company ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

50.5 Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

The Company is exposed to interest rate risk arising mainly from debt. The Company is exposed to interest rate risk because the fair value of fixed rate borrowings and the cash flows associated with floating rate borrowings will fluctuate with changes in interest rates.

The Company is also exposed to foreign currency risk on certain transactions that are denominated in a currency other than the Company''s functional currency; hence exposures to exchange rate fluctuations arise. Considering the country and economic environment in which the Company operates, its operations are subject to risks arising from fluctuations in exchange rate in those countries. The risk is that the functional currency value of cash flows will vary as a result of movements in exchange rates. The Company holds derivative financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rate foreign currency exposure.

Foreign currency Risk:

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities (when revenue or expense is denominated in a foreign currency). The Company manages its foreign currency risk by hedging transactions that are expected to occur within a maximum 12-month period for hedges of forecasted sales.

b) Foreign currency sensitivity analysis

The Company is mainly exposed to currency fluctuation of USD.

The following table details the Company''s sensitivity to a 10% increase and decrease in the INR against the relevant foreign currencies. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for 10% change in foreign currency rates. A positive numbers below indicates an increase in profit or equity where the INR strengthens 10% against the relevant currency. For a 10% weakening of the INR against the relevant currency, there would be a comparable impact on the profit or equity, and the balance below would be negative.

In management''s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year.

50.6 Financial instrument - Risk exposure and fair value

Interest rate risk exposure

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s exposure to the risk of changes in market interest rates relates primarily to the company''s long-term debt obligations with floating interest rates

51 Capital Management

For the purpose of Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity share holders of the Company. The primary objective of the Company''s capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing loans and borrowings less cash and cash equivalents

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. As at 31 March 2023, there is no breach of covenant attached to the borrowings.

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

The capital structure of the Company consists of net debt (offset by cash and bank balances) and total equity of the Company.

53 The Company do not have any Benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property under the Benami Transaction Prohibition Act, 1988 and rules made thereunder.

54 There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

55 The Company do not have any charges or satisfaction which are yet to be registered with Registrar of Companies beyond the statutory period

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

57 The Company has not been declared as wilful defaulter by any bank or financial institution or government or any government authority.

58 The Company has complied with the number of layers of subsidiaries prescribed under Section 2(87) of the Companies Act, 2013

59 The quarterly returns or statements of current assets filed by the company with banks or financial institutions are in agreement with the books of accounts.

60 A. The Company has not advanced or loaned or invested funds to any other persons or entity, including

foreign entities (Intermediaries) with the understanding that the Intermediary shall:

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

(b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

B. The Company has not received any fund from any persons or entity, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries

61 The figures for the corresponding previous year have been regrouped/reclassified wherever necessary, to make them comparable.

62 The standalone financial statements were approved for issue by the board of directors on 23 May 2023

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Mar 31, 2018

1. Useful life of property, plant and equipment and intangible assets

The useful life of the assets are determined in accordance with Schedule II of the Companies Act, 2013. In cases, where the useful life is different from that or is not prescribed in Schedule II, it is based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance.

2. Impairment

An impairment loss is recognised for the amount by which an asset''s or cash-generating unit''s carrying amount exceeds its recoverable amount. To determine the recoverable amount, management estimates expected discounted future cash flows from each asset or cash-generating unit.

3. Deferred tax

Deferred income tax liabilities are recognised for all taxable temporary differences. Deferred income tax asset are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised.

4. Fair value

Management uses valuation techniques in measuring the fair value of financial instruments where active market quotes are not available. In applying the valuation techniques, management makes maximum use of market inputs and uses estimates and assumptions that are, as far as possible, consistent with observable data that market participants would use in pricing the instrument. Where applicable data is not observable, management uses its best estimate about the assumptions that market participants would make. These estimates may vary from the actual prices that would be achieved in an arm''s length transaction at the reporting date.

5. Post-retirement benefit plans

The obligation arising from the defined benefit plan is determined on the basis of actuarial assumptions which include discount rate, trends in salary escalation and vested future benefits and life expectancy. The discount rate is determined with reference to market yields at each financial year end on the government bonds.

6. Provisions and contingencies

The recognition and measurement of other provisions are based on the assessment of the probability of an outflow of resources, and on past experience and circumstances known at the reporting date. The actual outflow of resources at a future date may therefore vary from the figure estimated at end of each reporting period.

2B. New standards and interpretations not yet adopted

Appendix B to Ind AS 21, Foreign currency transactions and advance consideration:

On 28 March 2018, Ministry of Corporate Affairs ("MCA") has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 containing Appendix B to Ind AS 21, Foreign currency transactions and advance consideration which clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency. The amendment will come into force from

01 April 2018. The Company is evaluating the effect of this on the financial statements.

Ind AS 115 - Revenue from contract with customers:

On 28 March 2018, the Ministry of Corporate Affairs notified Ind AS 115 Revenue from contracts with customers. The standard replaces Ind AS 11 Construction contracts and Ind AS 18 Revenue. The new standard applies to contracts with customers. The core principle of the new standard is that an entity should recognise revenue to depict transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Further, the new standard requires enhanced disclosures about the nature, timing and uncertainty of revenues and cash flows arising from the entity''s contracts with customers.

The new standard permits two possible methods of transition:

- Retrospective approach - An entity can choose to apply the new standard to its historical transactions and retrospectively adjust each comparative period.

- Cumulative catch-up approach - An entity can recognise the cumulative effect of applying the new standard at the date of initial application and make no adjustments to its comparative information.

The Company is evaluating the effect of this new standard on revenue trends in the financial statements. The standard is effective for annual periods beginning on or after 01 April 2018.

Note:

Conversion of warrants Previous Year:

Conversion of 5,500,000 warrants issued during FY 2016-17 on preferential basis at a conversion price of ''95 per equity share of the Company as approved in the Extra Ordinary General Meeting dated 31 March 2015.

(ii) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of ''2 per share. Each holder of equity shares is entitled to one vote per share. Each equity shareholder is entitled to dividend in the Company.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

(iv) 1,445,200 shares of ''2 each (As at 31 March 2017 1,790,000 shares) are reserved towards outstanding employee stock options granted / available for grant.

(v) Aggregate number of shares allotted as fully paid pursuant to contract without payment of cash for a period of 5 years immediately preceding the balance sheet date:

38 Discontinued operations

38.1 Pursuant to the Scheme of Arrangement (the ''Scheme''), duly sanctioned by the National Company Law Tribunal (NCLT), Mumbai, vide Order dated 09 March 2018 (''Order''), with effect from the Appointment Date i.e. 01 October 2017, the Human API business of the Company was transferred to Solara Active Pharma Sciences Limited (''Solara'').

In line with the accounting prescribed in the Scheme, the net assets of the Human API business transferred amounting to ''1,794.63 have been debited to the securities premium account. The excess of fair value of the Human API business over the net assets transferred amounting to ''3,915.37 has been debited to retained earnings with a corresponding credit to the statement of profit and loss as ''Gain on demerger of Human API business''. The Human API business for previous year has been presented as discontinued operations in financial statements.

Pursuant to the above, SeQuent Penems Private Limited has ceased to be the subsidiary of the Company.

38.2 Analysis of profit for the year from discontinued operations

The financial performance and cash flow information of the Human API business included in the statement of profit and loss is as below. The figure for the Human API business included under the current year figure are for the period of 6 months ended 30 September 2017 and are therefore not comparable with the prior year figures (ie year ended 31 March 2017). contribution of ''0.46 (as at 31 March 2017 - ''5.80 ) is outstanding which is paid subsequent to the end of respective reporting periods.

(ii) Defined benefit plan:

The Company has a defined Gratuity benefit plan. The following table summarises the components of net employee benefit expenses recognised in the statement of profit and loss and the funded status and amounts recognised in the balance sheet for the plan.

(vi) No deferred tax adjustments were required in respect of amounts recognised in other comprehensive income in view of the nature of items included therein and the availability of unabsorbed tax losses(including tax depreciation).

(vii) No deferred tax adjustments were considered necessary to be recognised in respect of timing differences associated with investments in subsidiaries.

41 Employee benefit plans

(i) Defined contribution plans:

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised ''5.45 (year ended 31 March 2017 - ''7.64 ) for Provident Fund contributions and ''0.33 (year ended 31 March 2017 - ''0.17 ) for Employee State Insurance Scheme contributions in the statement of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes. As at 31 March 2018,

The current service cost is included in the ''Employee benefit expenses'' and the net interest cost is included in the ''Finance costs'' line item in the statement of profit and loss.

Dues to micro, small and medium enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management based on enquiries made by the Management with the creditors which have been relied upon by the auditors.

44 Segment reporting

I. Primary segment (Business segment):

The Company is mainly engaged in the business of pharmaceuticals. Considering the nature of business and financial reporting of the Company, the Company has only one business segment viz; pharmaceuticals as primary reportable segment.

II. Secondary segment (Geographical segment):

The Company operates in three principal geographic locations.

(i) Europe

(ii) Asia

(iii) Rest of the world

45 Related party transactions

45.1 List of related parties

(i) Subsidiaries

Wholly-owned subsidiaries:

Alivira Animal Health Limited, India SeQuent Research Limited Elysian Life Sciences Private Limited SeQuent Antibiotics Private Limited SeQuent Pharmaceuticals Private Limited

SeQuent Global Holdings Limited (Refer note 4)

SeQuent Scientific Pte Limited (Refer note 5)

Other subsidiaries:

Naari Pharma Private Limited (upto 26 July 2017)

SeQuent Penems Private Limited (upto 30 September 2017) (Refer note 2)

Step down subsidiaries:

Alivira Animal Health Limited, Ireland Alivira Animal Health Australia Pty Limited Provet Veteriner Urunleri San. ve Tic. A.§.

Topkim ilag Premiks San. ve Tic. A.§

Fendigo SA Fendigo BV N-Vet AB

Alivira Saude Animal Brasil Participacoes LTDA Interchange Veterinaria Industria E Comercio S.A. Brasil Vila Vina Participacions S.L.

Laboratorios Karizoo, S.A.

Laboratorios Karizoo, S.A. DE CV. (Mexico)

Comercial Vila Veterinaria De Lleida S.L.

Phytotherapic Solutions S.L Alivira UA Limited Alivira France (Refer note 3)

(ii) Key management personnel

Mr. Manish Gupta, Chief Executive Officer & Managing Director Dr.GautamKumarDas,JointManagingDirector(Upto07January2017) Mr. Sharat Narasapur,Joint Managing Director(From 08 January2017) Mr. Tushar Mistry, Chief Financial Officer (From 11 February 2017) Mr. P R Kannan, Chief Financial Officer (Upto 10 February 2017)

Mr. Krupesh Mehta, Company Secretary (From 11 February 2017)

Mr. Preetham Hebbar, Company Secretary (Upto 10 February 2017)

Mr. K E C Rajakumar, Non-Executive Director

Dr. S Devendra, Non-Executive Director

Dr. Gopakumar G. Nair, Chairman & Independent Director

Dr Kausalya Santhanam, Independent Director

Mr. Narendra Mairpady, Independent Director

(iii) Enterprises owned or significantly influenced by individuals who have control / significant influence over the Company

Strides Shasun Limited Atma Projects

Agnus Holdings Private Limited Chayadeep Properties Private Limited Pronomz Ventures LLP

Naari Pharma Private Limited (From 27 July 2017)

Solara Active Pharma Sciences Limited (From 01 October 2017)

Notes:

1 Related parties are as identified by the Company and relied upon by the Auditors.

2 Pursuant to the scheme of demerger, SeQuent Penems Private Limited has ceased to be the subsidiary of the Company (Refer note 38).

3 Alivira France was incorporated on 02 February 2018.

4 SeQuent Global Holdings Limited (''SGHL''), was wound up vide order dated 06 April 2017.

5 SeQuent Scientific Pte Limited was wound up on 8 January 2018. The above mentioned provides the information about the Company''s structure including the details of the subsidiaries and the holding company. The following table provides the total amount of transactions that have been entered into with related parties for the relevant financial year:

46 Operating leases i) Leases as lessee

a) The Company''s significant leasing arrangements are in respect of factory building, land and guest houses. The Company has entered in to cancellable lease arrangement with 1 month notice period for its guest houses.

There is no non-cancellable operating lease commitments as at 31 March 2018 and 31 March 2017.

47 Share-based payment arrangements

A. Description of share-based payment arrangements i. Share option programmes (equity-settled)

The Company implemented "SeQuent Scientific Employees Stock Option Plan 2010" (SeQuent ESOP 2010), in the year 2008, as approved by the Shareholders of the Company and the Remuneration / Compensation / Nomination and Remuneration Committee of the Board of Directors.

B. Measurement of fair values

Fair value of share options granted in the year

The weighted average fair value of the share options granted during the financial year is ''74.17 (during the year ended 31 March 2017: ''103.26). Options were priced using a black scholes model. The fair value of the employee share options has been measured using the Black-Scholes formula. Service and non-market performance conditions attached to the arrangements were not taken into account in measuring fair value.

There have been no transfers among Level 1, Level 2 and Level 3 during the year.

Note:

(i) Refer note 2 (xiv) under significant accounting policies for recognition and measurement of financial assets.

(ii) The fair value of the investments in equity is based on the quoted price. The fair value of investments in mutual fund is based on market observable inputs. Derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the market place.

50.2 Financial risk management objectives and policies

The Company''s principal financial liabilities comprise loans and borrowings, trade payables and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include investments, loans, trade and other receivables, cash and short-term deposits that derive directly from its operations.

The Company is exposed to the following risks from its use of financial instruments:

- Credit risk

- Liquidity risk

- Market risk

This note presents information about the Company''s exposure to each of the above risks, the Company''s objectives, policies and processes for measuring and managing risk, and the Company''s management of capital. Further quantitative disclosures are included throughout these financial statements.

Risk management framework

The Company''s activities makes it susceptible to various risks. The Company has taken adequate measures to address such concerns by developing adequate systems and practices. The Company''s overall risk management program focuses on the unpredictability of markets and seeks to manage the impact of these risks on the Company''s financial performance.

The Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework.

The Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Company has established Audit Committee and its constitution, quorum and scope is in line with the Companies Act, 2013, provisions of Listing Agreement as entered with the Stock Exchange/Regulations. The Audit Committee comprises of three non-executive independent directors nominated by the Board of Directors.

The Audit Committee oversees how management ensures compliance of Internal Control Systems, compliance with the Company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular and adhoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.

The Audit Committee also reviews the adequacy of internal audit function, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit. In order to ensure that all checks and balances are in place and all internal control systems are in order, regular and exhaustive internal audits are conducted by experienced firms of Chartered Accountants.

50.3 Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations resulting in a financial loss to the Company. Credit risk arises principally from the Company''s trade receivables. Credit risk arises from cash held with banks and financial institutions, as well as credit exposure to clients, including outstanding accounts receivable. The maximum exposure to credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.

The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit-ratings assigned by credit-rating agencies.

The Company''s trade and other receivables are actively monitored to review credit worthiness of the customers to whom credit terms are granted and also avoid significant concentrations of credit risks.

The Company continuously monitors defaults of customers and other counterparties, identified either individually or by the Group, and incorporates this information into its credit risk controls.

The Company limits its exposure to credit risk by generally investing in liquid securities and only with counter parties that have a good credit rating. The Company does not expect any losses from non- performance by these counter parties, and does not have any significant concentration of exposures to specific industry sectors.

Trade receivables consist of a large number of customers spread across diverse industries and geographical areas. On-going credit evaluation is performed on the financial condition of accounts receivable and where appropriate, credit guarantee insurance cover is purchased.

Information about major Customer

Revenue from single external customer is approximately Rs,513.19 (31 March 2017 Rs,1,210.77) representing 50% of Company''s total revenue from continuing business for the year ended 31 March 2018. Apart from the aforesaid single customer, the Company does not have a significant credit risk exposure to any other single counterparty.

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by the company. The Company''s maximum exposure in this respect is the maximum amount the Company may have to pay if the guarantee is called on. As at 31 March 2018, an amount of Rs,1,666.62 (as at 31 March 2017 Rs,2,691.61) is outstanding as financial guarantee. These financial guarantees have been issued to banks under the loan agreements entered into with the subsidiaries.

50.4 Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.

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

The Company''s treasury department is responsible for managing the short-term and long term liquidity requirements of the Company. Short term liquidity situation is reviewed daily by treasury. Long-term liquidity position is reviewed on a regular basis by the Board of Directors and appropriate decisions are taken according to the situation.

Typically the Company ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

The table below provides details regarding the contractual maturities of significant financial liabilities as at 31 March 2018 and 31 March 2017:

50.5 Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

The Company is exposed to interest rate risk arising mainly from debt. The Company is exposed to interest rate risk because the fair value of fixed rate borrowings and the cash flows associated with floating rate borrowings will fluctuate with changes in interest rates.

The Company is also exposed to foreign currency risk on certain transactions that are denominated in a currency other than the Company''s functional currency; hence exposures to exchange rate fluctuations arise. The risk is that the functional currency value of cash flows will vary as a result of movements in exchange rates. The Company holds derivative financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rate foreign currency exposure.

c) Foreign currency sensitivity analysis

b) Derivatives instruments

Derivative transactions are undertaken to act as economic hedges for the Company''s exposures to various risks in foreign exchange markets and may / may not qualify or be designated as hedging instruments.

Outstanding forward exchange contracts entered into by the Company as on 31 March 2018 and 31 March 2017:

Cash flow sensitivity analysis for variable-rate instruments

A change of 100 basis points in interest rates at the reporting date would have increased / (decreased) equity and profit and loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis is performed on the same basis for 2017.The Company is mainly exposed to currency fluctuation of USD and Euro. The following table details the Company''s sensitivity to a 10% increase and decrease in the INR against the relevant foreign currencies. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for 10% change in foreign currency rates. A positive numbers below indicates an increase in profit or equity where the INR strengthens 10% against the relevant currency. For a 10% weakening of the INR against the relevant currency, there would be a comparable impact on the profit or equity, and the balance below would be negative.

In management''s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year.

51 Capital management

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

The capital structure of the Company consists of net debt (borrowings as detailed in notes 23, 25 & 27 and 15 & 16 offset by cash and bank balances) and total equity (as detailed in notes 21& 22) of the Company.

(i) Debt is defined as long-term (including current maturity excluding financial guarantee contracts) and short-term borrowings.

(ii) Other bank balance exclude the bank balance towards unpaid dividend.

(iii) Gearing ratio: Net debt/ Equity. Since net debt is negative at 31 March 2018, gearing ratio is disclosed as Nil.

52 Corporate Social Responsibility Expenses (CSR)

As per Section 135 (1) of the Companies Act, 2013 read with guidelines issued by Department of Public Enterprises, the Company is required to spend, in every financial year, at least two per cent of the average net profits of the Company made during the three immediately preceding financial years in accordance with its CSR Policy.

Details of CSR spent during the financial year:

The Company is in the process of identifying the right charitable institutes to be associated with which has vis-a-vis same purpose as that of Company CSR Policy and therefore, in the current financial year there was a short spent of ''0.60 towards the CSR activities.

53 The financial statements were approved for issue by the board of directors on 24 May 2018.

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Mar 31, 2017

Note:

During the year, the company discounted trade receivables with an aggregate carrying amount of Rs, 76.94 million to a bank for cash proceeds of same value. If the trade receivables are not paid at maturity, the bank has the right to request the Company to pay the unsettled balance. As the Company has not transferred the significant risks and rewards relating to the trade receivables, it continues to recognize the full carrying amount of the receivables and has recognized the cash received on the transfer as a financial liability.

(ii) Please refer note 45 for details of Specified Bank Notes (SBN) held and transacted during

the period 08 November 2016 to 30 December 2016.

(iii) During the previous year, the Company entered into the following non cash investing and financing activity which are not reflected in the statement of cash flows:

-issued on a preferential basis to the promoter group entities and non- promoter group

entities 757,734 and 2,827,679 equity shares of Rs, 2 each respectively at a price of Rs, 669.1C per share towards additional investments made in Alivira Animal Health Limited.

Note:

(i) Balances in margin money deposits are held as security against borrowings, guarantees and other commitments.

Note: Pursuant to the approval of Board of Directors of the Company and shareholders received vide postal ballot dated 24 March 2017 for the divestment of woman healthcare business, the Company has entered into a definitive agreement for sale of subsidiary (Naari Pharma Private Limited) with Tenshi Life Science Private Limited and accordingly as on 31 March 2017 the investment in the subsidiary has been classified as held for sale, pending completion of certain conditions precedent and other customary closing conditions. In respect of the assets held for sale as at 31 March 2016, the Company intended not to dispose the same and hence the said assets are reclassified to respective assets group.

a Conversion of warrants Current Year

C onversion of 5,500,000 warrants issued during 2016-17 on preferential basis at a conversion price of Rs, 95 per equity share of the Company as approved in the Extra Ordinary General Meeting dated 31 March 2015.

(vii) Aggregate number of shares allotted as fully paid pursuant to contract without payment of cash for a period of 5 years immediately preceding the balance sheet date:

Previous Year

1 C onversion of 2,000,000 warrants issued during 2014-15 on preferential basis at a conversion price of Rs, 222.15 per equity share of the Company as approved in the Extra Ordinary General Meeting dated 21 May 2014.

2 T ,000,000 warrants on preferential basis at a conversion price of Rs, 236 per equity share of the Company as approved in the Extra Ordinary General Meeting dated 01 July 2014.

3 T ,100,000 warrants at a conversion price of Rs, 475 per equity share of the Company as approved in the Extra Ordinary General Meeting dated 31 March 2015.

b The Company on 26 May 2015 issued 7,476,635 equity shares of Rs, 10 each at a price of Rs, 535 per equity share to Qualified Institutional Buyers.

c During the previous year, the Company issued on a preferential basis to Promoter group entities and Non- Promoter group entities 757,734 and 2,827,679 equity shares of Rs, 10 each respectively at a price of Rs, 669.10 per equity share for consideration other than cash.

(ii) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs,2 per share (refer note (iv) below). Each holder of equity shares is entitled to one vote per share. Each equity shareholder is entitled to dividend in the Company.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

(iv) During 2015-16, based on the shareholder''s approval one equity share of Rs, 10 each is sub-divided into 5 equity share of Rs, 2 each with effect from 26 February 2016.

(v) T ,790,000 shares of Rs, 2 each (As at 31 March 2016 2,320,000 shares of Rs, 2 each) (As at

01 April 2015 582,500 shares of Rs, 10 each) are reserved towards outstanding employee stock options granted / available for grant.

(vi) As at 31 March 2017, Nil warrants of Rs, 2 each (As at 31 March 2016: 5,500,000 of Rs, 2 each) (As at 01 April 2015: 5,000,000 of Rs, 10 each) are outstanding to be converted into equivalent number of shares.

The interest on above term loans from other parties are linked to the respective lender''s base rates which are floating in nature.

(ii) Details of long-term borrowings guaranteed by some of the promoters or others

(iii) The Company has not defaulted in repayment of loans and interest.

Notes:

(i) Working capital loan from banks are secured by a first pari-passu charge on current assets of the Company and a second pari-passu charge on fixed assets of the Company as a collateral.

(ii) The Company has not defaulted in repayment of loans and interest.

(iii) Short-term borrowings of Rs, Nil (31 March 2016 Rs, Nil; 01 April 2015 Rs, 468.04 million) are guaranteed by some of the Promoters of the Company in their personal capacities.

(iv) Unsecured short-term borrowings of Rs, Nil (31 March 2016 Rs, Nil; 01 April 2015 Rs, 999.55 million) are secured against securities provided by entities owned by Promoters.

(i) Trade payables are non-interest bearing and are normally settled in 90 - 120 days.

(ii) For explanations on the Company''s credit risk management processes, refer note 46.3.

* The details of interest rates, repayment and other terms are disclosed under note 21.

(i) Current maturities of long-term debt (Refer notes (i) and (ii) in note 21 - Non-current borrowings for details of security and guarantee):

*All dividends from equity investments designated as at fair value through other comprehensive income recognized for both the years relate to investments held at the end of each reporting period.

**Fair value gain on financial instruments at fair value through profit or loss relates to mutual funds which has been fair valued at the year end.

1. EMPLOYEE BENEFIT PLANS

(i) Defined contribution plans:

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs, 19.80 million (year ended 31 March 2016 - Rs, 17.78 million) for Provident Fund contributions and Rs, 2.07 million (year ended 31 March 2016 - Rs, 1.25 million) for Employee State Insurance Scheme contributions in the statement of profit and loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes. As at 31 March 2017, contribution of Rs, 3.10 million (year end 31 March 2016 - Rs, 2.75 million) is outstanding which is paid subSequent to the end of respective reporting periods.

(ii) Defined benefit plan:

The Company has a defined Gratuity benefit plan. The following table summarizes the components of net employee benefit expenses recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the plan.

The current service cost and the net interest expense for the year are included in the ‘Employee benefits expense'' line item in the statement of profit and loss.

The remeasurement of the net defined benefit liability is included in other comprehensive income.

The amount included in the balance sheet arising from the entity''s obligation in respect of its defined benefit plans is as follows:

Actual return on plan assets is Rs, 0.21 million (31 March 2016 Rs, 0.39 million).

Actuarial assumptions

The principal assumptions used for the purpose of actuarial valuations are shown in the table below. The assumptions as at the balance sheet date are used to determine the present value of defined benefit obligation at that date.

* Outflow, if any, arising out of the said claim including interest, if any, would depend on the outcome of the decision of the Appellate Authority and the Company''s right for future appeal before the judiciary.

Dues to Micro and Small Enterprises have been determined to the extent such partie have been identified on the basis of information collected by the Management based o enquiries made by the Management with the creditors which have been relied upon by th auditors.

. RELATED PARTY TRANSACTIONS

3. List of related parties

i) Subsidiaries

Wholly-owned subsidiaries:

Alivira Animal Health Limited, India (Refer note 8 below)

Elysian Life Sciences Private Limited Sequent Antibiotics Private Limited Sequent Global Holdings Limited

Sequent Pharmaceuticals Private Limited (Formerly known as Sequent Oncolytics Private Limited)

Sequent Research Limited Sequent Scientific Pte Limited

Other subsidiaries:

Naari Pharma Private Limited (Formerly known as Indo Phyto Chemicals Private Limited)

Sequent Penems Private Limited

Step down subsidiaries:

Alivira Animal Health Limited, Ireland Alivira Animal Health Australia Pty Limited Sequent European Holdings Limited Provet Veteriner Urunleri San. ve Tic. A.s.

Fendigo SA Fendigo BV N-Vet AB

Topkim Ilac Premiks San. ve Tic. A.S

Alivira Saude Animal Brasil Participacoes LTDA (Refer note 3 below) Interchange Veterinaria Industria E Comercio S.A. Brasil,Brazil (Refer note 4 below)

Vila Vina Participacions S.L. (Refer note 5 below)

Laboratory Karizoo, S.A. (Refer note 5 below)

Laboratory Karizoo, S.A. DE C.V. (Mexico) (Refer note 5 below)

Comercial Vila Veterinaria De Lleida S.L. (Refer note 5 below)

Phytotherapic Solutions S.L (Refer note 5 below)

Alivira UA Limited, Ireland (Refer note 6 below)

(ii) Key Management Personnel

Mr. Manish Gupta, Chief Executive Officer & Managing Director Dr. Gautam Kumar Das, Joint Managing Director (Upto 07 January 2017)

Mr. Sharat Narasapur, Joint Managing Director (From 08 January 2017)

Mr. P R Kannan, Chief Financial Officer (Upto 10 February 2017)

Mr. Tushar Mistry, Chief Financial Officer (From 11 February 2017)

Mr. Preetham Hebbar, Company Secretary (Upto 10 February 2017)

Mr. Krupesh Mehta, Company Secretary (From 11 February 2017)

Mr. K E C Rajakumar (Non-Executive Director)

Dr. S Devendra (Non-Executive Director)

Dr. Gopakumar G. Nair (Chairman & Independent Director)

Dr Kausalya Santhanam (Independent Director)

Mr. Narendra Mairpady (Independent Director)

(iii) Enterprises owned or significantly influenced by individuals who have control / significant influence over the Company

Strides Shasun Limited (Formerly known as Strides Arcolab Limited)

Atma Projects

Agnus Holdings Private Limited Latitude Projects Private Limited Chayadeep Properties Private Limited Deesha Properties Agnus Capital LLP Chayadeep Ventures LLP Pronomz Ventures LLP

Notes:

1 Related parties are as identified by the Company and relied upon by the Auditors.

2 Sequent Global Holding Limited has filed for voluntary liquidation on 04 November 2016.

3 During 2016-17, Alivira Saude Animal Brasil Participacoes LTDA was incorporated on 10 June 2016.

4 During 2016-17, Alivira Saude Animal Brasil Participacoes LTDA acquired 70% stake in Interchange Veterinaria Industria E Comercio S.A. Brasil,Brazil.

5 During 2016-17, the Company''s step down subsidiary, Alivira Animal Health Limited, Ireland acquired 60% stake in Vila Vina Participacions S.L., Spain along with its four subsidiaries - Laboratorios Karizoo, S.A.,Spain, Comercial Vila Veterinaria De Lleida

S.L.,Spain, Phytotherapic Solutions S.L,Spain and Laboratorios Karizoo, S.A. De C.V.,Mexico.

6 Alivira UA Limited, Ireland was incorporated on 30 September 2016.

7 During the year Sequent European Holdings Limited was wound up on 30 November 2016.

8 The shareholding of Alivira Animal Health Limited as at 31 March 2016 is 100% as compared to 91.92% at 01 April 2015.

The above mentioned provides the information about the Company''s structure including the details of the subsidiaries and the holding company. The following table provides the total amount of transactions that have been entered into with related parties for the relevant financial year:

4. OPERATING LEASES Leases as lessee Leasing arrangements

a) The Company''s significant leasing arrangements are in respect of factory building, land and guest houses. The Company has entered in to cancellable lease arrangement with 1 month notice period for its guest houses.

42 SHARE-BASED PAYMENT ARRANGEMENTS

A. Description of share-based payment arrangements i . Share option programmes (equity-settled)

The Company implemented "Sequent Scientific Employees Stock Option Plan 2010” (Sequent ESOP 2010), in the year 2008, as approved by the Shareholders of the Company and the Remuneration / Compensation / Nomination and Remuneration Committee of the Board of Directors.

E. Share options excercised at the end of the year

T he share option outstanding at the end of the year had a weighted average exercise price of '' 29.87 (as at 31 March 2016: '' 24.08) and weighted average remaining contractual life of 2.57 years (as at 31 March 2016: 3.21 years).

F. Split of Shares

During 2015-16, based on the shareholder''s approval one equity share of Rs, 10 each is sub-divided into 5 equity share of Rs, 2 each with effect from 26 February 2016.

B. Measurement of fair values

Fair value of share options granted in the year

T he weighted average fair value of the share options granted during the financial year is Rs, 103.26 (during the year ended 31 March 2016: Rs, 179.29). Options were priced using a black scholes model. The fair value of the employee share options has been measured using the black scholes formula. Service and non-market performance conditions attached to the arrangements were not taken into account in measuring fair value.

T he requirement that the employee has to save in order to purchase shares under the share purchase plan has been incorporated into the fair value at grant date by applying a discount to the valuation obtained. The discount has been determined by estimating the probability that the employee will stop saving based on historical behaviour.

The above include costs associated with the development services undertaken for customers.

5. INTANGIBLE ASSETS/INTANGIBLE ASSETS UNDER DEVELOPMENT:

During the year, the following development expenditure have been transferred to intangible assets / intangible assets under development from the statement of profit and loss: *For the purpose of this clause, the term ‘Specified Bank Notes'' shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O3407 (E ), dated 08 November 2016.

6.1 Fair value hierarchy

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

The following table presents the fair value measurement hierarchy of financial assets and liabilities measured at fair value on recurring basis as at 31 March 2017, 31 March 2016 and 01 April 2015.

Notes:

(i) Refer note 2 (xiv) under significant accounting policies for recognition and measurement of financial assets.

(ii) The fair value of the investments in equity is based on the quoted price. The fair value of investments in mutual fund is based on market observable inputs. Derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the market place.

7. Financial Risk Management Objective And Policies

T he Company''s principal financial liabilities comprise loans and borrowings, trade payables and other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s principal financial assets include investments, loans, trade and other receivables, and cash and short-term deposits that derive directly from its operations.

The Company is exposed to the following risks from its use of financial instruments:

- Credit risk

- Liquidity risk

- Market risk

This note presents information about the Company''s exposure to each of the above risks, the Company''s objectives, policies and processes for measuring and managing risk, and the Company''s management of capital. Further quantitative disclosures are included throughout these financial statements.

Risk management framework

The Company''s activities makes it susceptible to various risks. The Company has taken adequate measures to address such concerns by developing adequate systems and practices. The Company''s overall risk management program focuses on the unpredictability of markets and seeks to manage the impact of these risks on the Company''s financial performance.

T he Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework.

T he Company''s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities. The Company, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations.

The Company has established Audit Committee and its constitution, quorum and scope is in line with the Companies Act, 2013, provisions of Listing Agreement as entered with the Stock Exchange/Regulations. The audit committee comprises of three non-executive independent directors nominated by the Board of Directors.

The Audit committee oversees how management ensures compliance of Internal Control Systems, compliance with the Company''s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular and adhoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.

The Audit committee also reviews the adequacy of internal audit function, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit. In order to ensure that all checks and balances are in place and all internal control systems are in order, regular and exhaustive internal audits are conducted by experienced firms of Chartered Accountants.

8. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations resulting in a financial loss to the Company. Credit risk arises principally from the Company''s receivables from trade receivables. Credit risk arises from cash held with banks and financial institutions, as well as credit exposure to clients, including outstanding accounts receivable. The maximum exposure to credit risk is equal to the carrying value of the financial assets. The objective of managing counterparty credit risk is to prevent losses in financial assets. The Company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.

T he credit risk on liquid funds and derivates financial instruments is limited because the counterparties are banks with high credit-ratings assigned by credit-rating agencies.

T he Company''s trade and other receivables are actively monitored to review credit worthiness of the customers to whom credit terms are granted and also avoid significant concentrations of credit risks.

The Company continuously monitors defaults of customers and other counterparties, identified either individually or by the Group, and incorporates this information into its credit risk controls.

The Company limits its exposure to credit risk by generally investing in liquid securities and only with counterparties that have a good credit rating. The Company does not expect any losses from non- performance by these counterparties, and does not have any significant concentration of exposures to specific industry sectors.

Trade receivables consist of a large number of customers spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable and where appropriate, credit guarantee insurance cover is purchased.

Information about major Customer

Tevenue from single external customer is approximately '' 1,210.77 million representing 32% of Company''s total revenue for the year ended 31 March 2017. Apart from the aforesaid single customer, the Company does not have a significant credit risk exposure to any other single counterparty.

In addition, the Company is exposed to credit risk in relation to financial guarantees given to banks provided by the company. The company''s maximum exposure in this respect is the maximum amount the Company could have to pay if the guarantee is called on. As at 31 March 2017, an amount of '' 1,987.49 million is outstanding as financial guarantee. These financial guarantees have been issued to banks under the loan agreements entered into with the subsidiaries.

9. Liquidity risk

L iquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company''s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company''s reputation.

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

The Company''s treasury department is responsible for managing the short-term and long-term liquidity requirements of the Company. Short-term liquidity situation is reviewed daily by treasury. Long-term liquidity position is reviewed on a regular basis by the Board of Directors and appropriate decisions are taken according to the situation.

Typically the Company ensures that it has sufficient cash on demand to meet expected operational expenses for a period of 60 days, including the servicing of financial obligations; this excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters.

The table below provides details regarding the contractual maturities of significant financial liabilities as at 31 March 2017, 31 March 2016 and 01 April 2015.

c) Foreign currency sensitivity analysis

The Company is mainly exposed to currency fluctuation of USD and Euro. The following table details the Company''s sensitivity to a 10% increase and decrease in the INR against the relevant foreign currencies. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for 10% change in foreign currency rates. A positive numbers below indicates an increase in profit or equity where the INR strengthens 10% against the relevant currency. For a 10% weakening of the INR against the relevant currency, there would be a comparable impact on the profit or equity, and the balance below would be negative.

10. Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

The Company is exposed to interest rate risk arising mainly from debt. The Company is exposed to interest rate risk because the fair value of fixed rate borrowings and the cash flows associated with floating rate borrowings will fluctuate with changes in interest rates.

The Company is also exposed to foreign currency risk on certain transactions that are denominated in a currency other than the company''s functional currency; hence exposures to exchange rate fluctuations arise. The risk is that the functional currency value of cash flows will vary as a result of movements in exchange rates. The Company holds derivative financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rate on foreign currency exposure.

In management''s opinion, the sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year.

Cash flow sensitivity analysis for variable-rate instruments

A change of 100 basis points in interest rates at the reporting date would have increased / (decreased) equity and profit and loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis is performed on the same basis for 2016.

11. CAPITAL MANAGEMENT

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

T he capital structure of the Company consists of net debt (borrowings as detailed in notes 21, 23 and 25 and 7, 13 and 14 offset by cash and bank balances) and total equity of the Company.

(ii) Other bank balance exclude the bank balances towards unpaid dividend.

12.CORPORATE SOCIAL RESPONSIBILITY EXPENSES (CSR)

As per Section 135 (1) of the Companies Act, 2013 read with guidelines issued by Department of Public Enterprise (DPE), the Company is required to spend, in every financial year, at least two percent of the average net profits of the Company made during the three immediately preceding financial years in accordance with its CSR Policy.

Details of CSR spent during the financial year:

Due to inadequate profits in recent financial years, the Company has not spent on the CSR activities. However, the Company is committed towards sustainable development of the society and the country and is confident of contributing towards the CSR activities in the coming years upon being profitable.

13. FIRST TIME ADOPTION OF IND AS Explanation of transition to Ind AS

The Company has prepared its first financial statements in accordance with Ind AS for the year ended 31 March 2017. For periods up to and including the year ended 31 March

2016, the Company prepared its financial statements in accordance with Indian GAAP, including accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended). The effective date for Company''s Ind AS opening balance sheet is 01 April 2015 (the date of transition to Ind AS according to Ind AS 101-Firsttime adoption of Indian Accounting Standards).

Certain exceptions as well as certain optional exemptions availed by the Company are described below:

i ) Classification on of debt instruments

The Company has determined the classification of debt instruments in terms of whether they meet the amortized cost criteria or the fair value through other comprehensive income criteria based on the facts and circumstances that existed as on the transition date.

ii) Property, plant and equipment, investment property and intangible assets

The Company has elected to continue with the carrying value of all of its property, plant and equipment, investment property and intangible assets recognized as of 01 April 2015 (transition date) measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

iii) Investments in subsidiaries in separate financial statements

The Company has elected to carry forward investment in subsidiaries at previous GAAP carrying amount.

iv) Share-based payment transaction

The Company is allowed to apply Ind AS 102-Share-based Payment to equity instruments that remain unvested as of transition date. The Company has elected to avail this exemption and fair value all unvested grants under the Sequent Employee Stock Option Plan 2010 (‘the ESOP Plan'')

v) Equity investments at fair value through other comprehensive income

The Company has designated investment in equity instrument at fair value through other comprehensive income on the basis of facts and circumstances that existed on the transition date.

vi) Long-term foreign currency monetary items

The Company has elected to continue the policy adopted for accounting for exchange differences arising from translation of long-term foreign currency monetary items recognized in the financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period (i.e. 01 April 2016) as per the previous GAAP.

(i) Debt is defined as long-term (including current maturity but excluding financial guarantee contracts) and short-term borrowings.

Notes:

Under previous GAAP, total comprehensive income was not reported. Thus the above reconciliation starts with the profit under the previous GAAP.

(a) Revenue from operations

U nder previous GAAP, revenue from sale of products was presented net of excise duty under revenue from operation. However, under Ind AS, revenue from sale of products includes excise duty. The corresponding excise duty expense is presented separately on the face of the statement of profit and loss. The change does not effect the total equity as at 01 April 2015 and 31 March 2016, profit before tax or total profit for the year ended 31 March 2016.

(b) Fair value of investments

(i) Under previous GAAP, long-term investments in equity were measured at cost less diminution in value other than temporary. Under Ind AS, these investments have been classified as fair value through other comprehensive income. On the date of transition to Ind AS, these investments are measured at their fair value which is higher than carrying value as per previous GAAP, resulting in an increase in the carrying amount by Rs, 918.40 million as at 01 April 2015 and by Rs, 1,521.26 million as at 31 March 2016. These changes do not affect profit before tax or total profit for the year ended 31 March 2016 because the investments have been classified as fair value through other comprehensive income.

(ii) Under previous GAAP, current investments in equity were measured at lower of cost or fair value. Under Ind AS, these have been classified as fair value through other comprehensive income. On the date of transition to Ind AS, these investments are measured at their fair values, resulting in an increase in carrying amount by Rs, 0.95 million as at 01 April 2015 and decrease in carrying amount by Rs, 0.39 million as at 31 March 2016. These changes do not affect profit before tax or total profit for the year ended 31 March 2016 because the investments have been classified as fair value through other comprehensive income.

(iii) Under previous GAAP, investments in mutual funds were measured at lower of cost or fair value. Under Ind AS, investments in mutual funds are classified as fair value through profit or loss with the fair value changes being recognized in the statement of profit and loss. On transitioning to Ind AS, these have been measured at their fair values which is higher than cost as per previous GAAP, resulting in an increase in carrying amount by Rs, 36.55 million as at 31 March 2016. The net effect of these changes is an increase in profit before tax for the year ended 31 March 2016 by Rs, 36.55 million. On the date of transition, the Company did not have any investment in mutual funds.

(c) Fair value of derivative forward contract

Under previous GAAP, premium / discount on forward exchange contracts, which are not intended for trading or speculation purposes, were amortized over the period of the contracts if such contracts relate to monetary items as at the balance sheet date. Under Ind AS, forward exchange contracts are financial instruments which are measured at fair value. On the date of transition, the derivative instruments are classified as fair valued through profit or loss. The net effect of these changes is a decrease in total equity and financial asset by Rs, 0.26 million as at 31 March 2016 (Rs, Nil as at 01 April 2015) and decrease in total profits by Rs, 0.26 million for the year ended 31 March 2016.

(d) Employee benefits

Under previous GAAP, actuarial gains and losses were recognized in the statement profit and loss. Under Ind AS, the actuarial gains and losses form part of remeasurement of the net defined benefit liability / asset which is recognized in other comprehensive income. The actuarial gain for the year ended 31 March 2016 was Rs, 6.95 million. This change does not affect total equity, but there is a decrease in total profit by Rs, 6.95 million for the year ended 31 March 2016.

(e) Share-based payments

U nder previous GAAP, the cost of equity-settled employee share-based payments was recognized using the intrinsic value method. Under Ind AS, the cost of equity-settled employee share-based payments is recognized based on the fair value of the options as on the grant date. Accordingly, all the unvested options on the date of transition are measured at fair value. The excess of stock compensation expense measured using fair value over the cost recognized under previous GAAP has been adjusted in ‘employee stock options outstanding'', with the corresponding impact taken to the retained earnings as on the

transition date. The change does not affect total equity, but there is a decrease in profit before tax as well as total profit for the year ended 31 March 2016 by Rs, 8.07 million.

(f) Trade receivables

U nder previous GAAP, trade receivables derecognized by way of bills of exchange were shown as contingent liabilities since there is recourse clause. Under Ind AS, the trade receivables have been restated with corresponding recognition of financial liabilities. This has resulted in increase in trade receivables and other financial liabilities by Rs, 69.65 million and Rs, 16.44 million as at 31 March 2016 and 01 April 2015 respectively.

(g) Loan initiation costs

U nder previous GAAP, the Company had followed the policy to carry the loan initiation costs under prepaid expense and amortized the same over the term of the related loans. Under Ind AS, loan initiation costs are netted off from borrowings and amortized over the term of the related loan. This has resulted in decrease in prepaid expenses amounting to Rs, 21.63 million (current portion of prepaid expense Rs, 4.77 million) on

01 April 2015 and Rs, 5.09 million (current portion of prepaid expenses Rs, 1.44 million) as on 31 March 2016 with a corresponding decrease in borrowings.

(h) Land classified as operating lease

Under previous GAAP lease prepayments made for leasehold land were classified as leasehold land . Under Ind AS, prepayments made for leasehold land which does not meet the recognition criteria of finance lease are classified as prepaid rent under operating lease and the same is amortized over the lease term. Accordingly, lease prepayments as on 01 April 2015 are classified from leasehold land into prepaid expenses as follows:

Non-current : Rs, 89.53 million

Current : Rs, 1.09 million_

Total : Rs, 90.62 million

Turing the year ended 31 March 2016, depreciation and amortisation expense towards leasehold land amounting to Rs, 1.09 million has been reclassified to rent expense. This change does not effect the total equity as at 01 April 2015 and 31 March 2016, profit before tax or total profit for the year ended 31 March 2016.

(i) Exceptional item

T he transaction costs related to the acquisition was shown as exceptional item under previous GAAP. The Company has reclassified such items to other expenses in the statement of profit and loss for the year ended 31 March 2016 amounting to Rs, 5.40 million. These changes do not affect profit before tax or total profit for the year ended 31 March 2016.

(j) Other comprehensive income

Under previous GAAP, there was no concept of other comprehensive income. Under Ind AS, specified items of income, expense, gains or losses are required to be presented in other comprehensive income.

(k) Employee stock option plan trust

With effect from transition date, the Company has consolidated employee stock option plan trust, hence the cash and bank balance held by the trust is being grouped under cash and cash equivalents amounting to Rs, 0.17 million (31 March 2016: Rs, 0.13 million) and outstanding liabilities is being grouped under other financial liabilities amounting to Rs, 0.01 million (31 March 2016: Rs, 0.03 million).

(l) Investment property

Under previous GAAP, there was no requirement to present investment property separately and the same was included under non-current assets and measured at cost less accumulated depreciation. Under Ind AS, investment property is required to be presented separately in the balance sheet and depreciation is charged on it. Accordingly, the carrying value of investment property as at 01 April 2015 of Rs, 63.93 million (31 March 2016: Rs, 62.89 million ), under previous GAAP has been reclassified to a separate line item on the face of the balance sheet and depreciation is provided based on the estimated useful life. These changes do not affect profit before tax or total profit for the year ended 31 March 2016.

(m) Option granted to employees of subsidiary company

Under Ind AS, when the entity receives the goods or services without any obligation to settle the transaction, the transaction is a parent''s equity contribution to the subsidiary, regardless of any intragroup repayment arrangements. Hence, the Company has accounted the option granted to subsidiary employees, as an increase in investment by Rs, 8.57 million as at 31 March 2016 with a corresponding decrease in employee stock option expense for the year ended 31 March 2016.

(n) Guarantee extended to subsidiary

Under Ind AS, financial guarantee provided by the Company over the liability of a subsidiary without any consideration are accounted as a capital contribution to the subsidiary. Accordingly '' 3.21 million as at 31 March 2016 has been recognized as increase in investment in subsidiary company with a corresponding impact on profit or loss. Whereas under previous GAAP, these were not recognized in the financial statements. The net effect of this change is an increase in total equity by Rs, 3.21 million. as at 31 March 2016 (Rs, Nil as at 01 April 2015) and increase in profit before tax and total profit by Rs, 3.21 million for the year ended 31 March 2016.

(o) Statement of cash flows

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

---

Mar 31, 2016

Notes:

(i) During the year, based on the shareholder''s approval one equity share of Rs. 10 each is sub-divided into 5 equity shares of Rs. 2 each with effect from February 26, 2016.

Note:

(a) Conversion of Warrants:

Current Year:

1. Conversion of 2,000,000 warrants issued during the year 2014-15 on preferential basis at a conversion price ofRs. 222.15 per equity share of the Company as approved in the Extra Ordinary General Meeting dated May 21, 2014.

2. 3,000,000 warrants on preferential basis at a conversion price ofRs. 236 per equity share of the Company as approved in the Extra Ordinary General Meeting dated July 1, 2014.

3. 1,100,000 warrants at a conversion price ofRs. 475 per equity share of the Company as approved in the Extra Ordinary General Meeting dated March 31, 2015.

Previous Year:

Conversion of 3,150,000 warrants issued on preferential basis at a conversion price of Rs. 135.25 per equity share of the Company as approved in the Extra Ordinary General Meeting dated January 14, 2014.

(b) The Company on May 26, 2015 issued 7,476,635 equity shares ofRs. 10 each at a price of Rs. 535 per equity share to Qualified Institutional Buyers.

(c) During the year, the Company issued on a preferential basis to promoter group entities and non- promoter group entities 757,734 and 2,827,679 equity shares of Rs. 10 each respectively at a price ofRs. 669.10 per share for consideration other than cash.

(iii) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value ofRs. 2 per share (Previous year Rs. 10 per share (Refer note (i) above)). Each holder of equity shares is entitled to one vote per share. Each equity shareholder is entitled to dividend in the Company. The dividend is proposed by the Board of Directors and is subject to the approval of the shareholders in the ensuing Annual General Meeting, except interim dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

The amount of dividend per share recognized as distributions to equity shareholders is Nil (31 March 2015 : Rs. Nil)

(v) 2,320,000 shares (31 March, 2015 582,500 shares of Rs. 10 each) of Rs. 2 each (Refer note

(i) above) are reserved towards outstanding employee stock options granted / available for grant. (Refer Note 29)

(vi) As at 31 March 2016, 5,500,000 warrants (31 March 2015: 5,000,000 of Rs. 10 each) of Rs.2 each (Refer note (i) above) are outstanding to be converted into equivalent number of shares. (Refer Note 27.1)

(vii) Aggregate number of shares allotted as fully paid pursuant to contract without payment of cash for a period of 5 years immediately preceding the Balance Sheet date:

The interest on above term loans from other parties are linked to the respective lender''s base rates which are floating in nature. As of 31 March 2016 the interest rates ranges from 12.7% to 13.1% per annum.

(i) Working capital loan from banks are secured by a first pari-passu charge on current assets of the Company and a second pari-passu charge on fixed assets of the Company as a collateral.

(ii) Short-term borrowings of Rs.Nil (31 March 2015 Rs.468.04 million) are guaranteed by some of the Promoters of the Company in their personal capacities.

(iii) The Company has not defaulted in repayment of loans and interest.

(iv) Unsecured short-term borrowings of Rs.Nil (31 March 2015 Rs.999.55 million) are secured against securities provided by entities owned by Promoters.

(a) During the previous year, pursuant to Order of Honourable High Court of Karnataka, the Share Capital of Sequent Penems Private Limited reduced from 8,076,653 to 4,038,327 shares of Rs.10 each. Consequently, proportionate investment value in Sequent Penems Private Limited is reduced from Rs. 402.83 Millions to Rs. 201.40 Millions and amount written off is included under exceptional items (Refer note 26)

(b) During the year, the Company converted 7,100,000 warrants to equal number of equity shares of Rs. 2 each. With this conversion, the Company had 10,600,000 equity shares of Shasun Pharmaceuticals Limited. Subsequently, pursuant to Scheme of Amalgamation between Strides Arcolab Limited and Shasun Pharmaceuticals Limited, the Company has received 3,312,500 equity shares of Rs. 10 each in the amalgamated entity (Strides Shasun Limited) in lieu of 10,600,000 shares of Shasun Pharmaceuticals Limited.

(c) Trade investment in equity instruments of other entities includes Nil (31 March 2015: Rs.195.25 Million) investment made in Shasun Pharmaceuticals Limited towards 25% of amount paid for subscription of 7,100,000 of warrants at a price of Rs. 110 per warrant. Each warrant is convertible into one equity share of face value of Rs. 2 each on payment of balance subscription amount of Rs.585.75 Million on or before 28 November 2015. The Company has converted the warrants to equivalent number of equity shares during the year. (Also refer note (b) above).

provisions, if any of the Companies Act, 2013, at a conversion price of Rs.222.15/per equity share of the Company including a premium of Rs. 212.15/- per equity share, arrived at in accordance with the SEBI Guidelines in this regard and the application money amounting to Rs. 111.08 Million was received from the allottees. As on March 31, 2015 all the warrants were outstanding.

The balance application money as at March 31, 2015 amounting to Rs.111.08 Million represents money received against 2,000,000 warrants.

b) The Board of Directors of the Company further by circular resolution on July 11, 2014 pursuant to the approval given by the members of the Company at their Extraordinary General Meeting held on July 1, 2014 had resolved to create, offer, issue and allot up to 3,000,000 warrants to promoter group entities, convertible into 3,000,000 equity shares of Rs.10/- each on a preferential allotment basis, pursuant to Sections 62(1) (c), 42 and other applicable provisions, if any of the Companies Act, 2013, at a conversion price of Rs.236/- per equity share of the Company including a premium of Rs. 226/- per equity share, arrived at in accordance with the SEBI Guidelines in this regard and the application money amounting to Rs. 177 Million was received from the allottees. As on March 31, 2015 all the warrants were outstanding.

The balance application money as at March 31, 2015 amounting to Rs.177 Million represents money received against 3,000,000 warrants.

NOTE 27 ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS

4 Money received against share warrants

Current year:

a) The Board of Directors of the Company on 11 April 2015 and 13 April 2015 pursuant to the approval given by the members of the Company at their Extraordinary General Meeting held on 31 March 2015 had resolved to create, offer, issue and allot up to 1,100,000 warrants to promoter group entities, convertible into 1,100,000 equity shares of Rs.10/- each and 1,100,000 warrants to non-promoter, convertible into 1,100,000 equity shares of Rs.10/- each respectively, on a preferential allotment basis, pursuant to Sections 62(1) (c), 42 and other applicable provisions, if any of the Companies Act, 2013, at a conversion price of Rs.475/- per equity share of the Company including a premium of Rs. 465/- per equity share, arrived at in accordance with the SEBI Guidelines in this regard and the application money amounting to Rs. 261.25 Million was received from the allotters. Out of the above, 1,100,000 warrants issued to non-promoters have been converted into equivalent number of equity shares on 10 June 2015. As on 31 March 2016, 1,100,000 warrants were outstanding.

The balance application money as at 31 March 2016 amounting to Rs.130.63 Million represents money received against 1,100,000 warrants (after subdivision 5,500,000 warrants) (Refer Note 2(i)).

b) The warrants may be converted into equivalent number of shares on payment of the balance amount at any time on or before 11 October 2016. In the event the warrants are not converted into shares within the said period, the Company is eligible to forfeit the amounts received towards the warrants.

The Company has sufficient authorized capital to cover the allotment of these shares.

Previous year:

a) The Board of Directors of the Company on May 28, 2014 at its Board meeting pursuant to the approval given by the members of the Company at their Extraordinary General Meeting held on May 21, 2014 had resolved to create, offer, issue and allot up to 2,000,000 warrants to promoter group entities, convertible into 2,000,000 equity shares of Rs.10/- each on a preferential allotment basis, pursuant to Sections 62(1) (c), 42 and other applicable

* Outflow, if any, arising out of the said claim including interest, if any, would depend on the outcome of the decision of the Appellate Authority and the Company''s right for future appeal before the judiciary.

** Outflow, if any, would depend on party not honoring the bill on due date and the Company''s further legal right.

Note

(a) The Company has given a corporate guarantee to Export and Import Bank of India towards a credit facility availed by its subsidiary (Alivira Animal Health Limited) amounting to '' 1,250 Million. (31 March 2015 - '' 1,250 Million). Outstanding balance as on 31 March 2016 is '' 1,237.50 Million (31 March 2015 -'' 1,237.50 Million).

(b) The Company has given a corporate guarantee to RBL Bank Limited towards a credit facility availed by its subsidiary (Alivira Animal Health Limited) amounting to Rs. 1,350 Million (31 March 2015 - Rs. 649.7 Million). Outstanding balance as on 31 March 2016 is Rs.189.95 Million (31 March 2015 - Rs. 295.10 Million).

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management based on enquiries made by the Management with the creditors which have been relied upon by the auditors.

5 Details on derivatives instruments and unheeded foreign currency exposures

(i) Outstanding forward exchange contracts entered into by the Company as on 31 March 2016 Pursuant to the transition provisions prescribed in Schedule II to the Companies Act, 2013, the Company has fully depreciated the carrying value of assets, net of residual value, where the remaining useful life of the asset was determined to be nil as on 1 April 2014, and has adjusted an amount of Rs.4.40 Million against the Surplus/(Deficit) in Statement of Profit and Loss as on 1 April 2014 under Reserves and Surplus (Refer note 3(e)).

The depreciation expense in the Statement of Profit and Loss for the year ended 31 March 2015 is higher by Rs. 3.45 Million consequent to the change in the useful life of the assets.

6. The Company has issued equity shares amounting to Rs. 4,000.00 million through Qualified Institutional Placement for purposes of meeting long term funding requirements including investments, capital expenditure and general business requirements. As at 31 March, 2016, an amount of Rs. 585.00 million (31 March, 2015 Rs. Nil) is temporarily invested in short term mutual funds, pending utilization.

7 Employee benefit plans

8.a Defined contribution plans

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs. 17.78 Million (Year ended 31 March 2015 - Rs. 19.26 Million) for Provident Fund contributions and Rs. 1.25 Million (Year ended 31 March 2015 - Rs. 1.45 Million) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

9.b Defined benefit plans

The Company has a defined Gratuity benefit plan. The following table summarizes the components of net employee benefit expenses recognized in the Statement of Profit and Loss and the funded status and amounts recognized in the Balance Sheet for the plan.

Notes

1. The discount rate is based on the prevailing market yields of Government of India securities as at the Balance Sheet date for the estimated term of the obligations.

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

3. The Company''s best estimate, as soon as it can reasonably be determined, of contributions expected to be paid to the plan during the annual period beginning after Balance Sheet date is Rs. 1.00 Million (31 March 2015 - Rs. Nil)

4. Expected rate of return on plan assets is determined after considering several applicable factors such as the composition of plan assets, investment strategy, market scenario, etc

Composition of the plan assets is as follows:

The details with respect to the investment made by Fund managers (LIC and SBI Life) into major categories of plan assets have not been disclosed, as the same has not been provided by the Fund managers to the Company.

Notes

1. The discount rate is based on the prevailing market yields of Government of India securities as at the Balance Sheet date for the estimated term of the obligations.

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

10. Related Party Disclosures:

A List of related parties:

i) Wholly-owned subsidiaries:

Alivira Animal Health Limited, India (Refer Note 2 below)

Alivira Animal Health Limited, Ireland (step-down subsidiary)

Alivira Animal Health Australia Pty Limited (step-down subsidiary) (Refer Note

3 below

SeQuent Global Holdings Limited

SeQuent European Holdings Limited (step-down subsidiary)

SeQuent Research Limited SeQuent Antibiotics Private Limited

SeQuent Pharmaceuticals Private Limited (Formerly Sequent Oncolytics Private Limited

Elysian Life Sciences Private Limited

Sequent Scientific Pte Limited (Refer Note 4 below)

ii) Other subsidiaries:

SeQuent Penems Private Limited

Indo Phyto Chemicals Private Limited (Refer note 5 below)

Step down subsidiaries:

Provet Veteriner Urunleri San. ve Tic. A.S.

Fendigo SA (Refer Note 6 below)

Fendigo BV (Refer Note 6 below)

N-Vet AB (Refer Note 6 below)

Topkim Ilag Premiks San. ve Tic. A.S (Refer Note 7 below)

iii) Key Management Personnel

Mr. Manish Gupta, Chief Executive Officer & Managing Director Dr. Gautam Kumar Das, Joint Managing Director Mr. P R Kannan, Chief Financial Officer

iv) Enterprises owned or significantly influenced by individuals who have control/ significant influence over the Company:

Strides Shasun Limited (Formerly known as Strides Arcolab Limited)

Atma Projects

Agnus Holdings Private Limited Latitude Projects Private Limited Chayadeep Properties Private Limited Deesha Properties Agnus Capital LLP Chayadeep Ventures LLP Pronomz Ventures LLP

Note:

1 Related parties are as identified by the Company and relied upon by the Auditors.

2 The shareholding of Alivira Animal Health Limited as at March 31, 2016 is 100% as compared to 91.92% in the previous year.

3 Alivira Animal Health Australia Pty Limited was incorporated on 24 July

2015.

4 Sequent Scientific Pte Limited, Singapore was incorporated on 4 February

2016.

5 Sequent Scientific Limited acquired 51% shareholding in Indo Phyto Chemicals Private Limited on 27 January 2016.

6 Alivira Animal Health Limited, Ireland acquired 85% shareholding each in Fendigo SA, Belgium, Fendigo BV, Netherlands and N-Vet AB, Sweden on 1 October 2015.

7 Provet Veteriner Urunleri San. ve Tic. A.S. acquired 100% shareholding in Topkim Ilag Premiks San. ve Tic. A.S on 11 December 2015.

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Mar 31, 2014

SHARE CAPITAL

(i) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting year:

Note:

a) Conversion of 2,750,000 warrants issued during the year 2012-13 on preferential basis at a conversion price of Rs. 172.00 per equity share of the company as approved in the Extra Ordinary General Meeting dated 20 March 2013 and 550,00C warrants issued during the year 2013-14 on preferential basis at a conversion price of Rs. 135.25 per equity share of the company as approved in the Extra Ordinary General Meeting dated 14 January 2014.

(During the previous year conversion of 2,100,000 warrants issued on preferential basis at a conversion price of Rs. 120.75 per equity share of the company as approved in the Annual General Meeting dated 26 September 2012).

(ii) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. Each equity shareholder is entitled to dividend in the Company. The dividend is proposed by the Board of Directors and is subject to the approval of the shareholders in the ensuing Annual General Meeting, except interim dividend.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the number of equity shares held by the shareholders.

The amount of dividend per share recognised as distributions to equity shareholders is Nil (31 March 2013 : Rs. Nil)

(iv) 700,000 shares (As at 31 March, 2013 700,000 shares) of Rs. 10 each are reserved towards outstanding employee stock options granted / available for grant. (Refer Note 30)

(v) As at 31 March 2014 3,150,000 warrants (31 March 2013: 2,750,000) of Rs. 10 each are outstanding to be converted into equivalent number of share. (Refer Note 28.1)

SHORT-TERM BORROWINGS

(i) Working capital loan from banks are secured by a first pari-passu charge on current assets of the Company and a second pari-passu charge on fixed assets of the Company as a collateral.

(ii) Short-term borrowings of Rs. 728.45 million (31 March 2013 Rs. 1,044.84 million) are guaranteed by some of the Directors of the Company in their personal capacities.

(iii) The Company has not defaulted in repayment of loans and interest.

(iv) Unsecured short-term borrowings of Rs. 1,200 million (31 March 2013 Rs. Nil) are secured against securities provided by entities owned by Promoters.

Money received against share warrants

The Board of Directors of the Company by circular resolution dated 28 January 2014 and as approved at its Extra-ordinary General Meeting held on 14 January 2014 have resolved to create, offer, issue and allot up to 3,700,000 warrants, convertible into 3,700,000 equity shares of Rs. 10/- each on a preferential allotment basis, pursuant tc Section 81(1A) of the Companies Act, 1956, at a conversion price of Rs. 135.25/- per equity share of the Company, arrived at in accordance with the SEBI Guidelines in this regard and the application money amounting to Rs. 125.10 Million was received from them. Out of this 550,000 warrants are convertered and shares are issued during the year. The balance application money as at 31 March, 2014 amounting to Rs. 106.51 Million represents money received against Rs. 3,150,000 warrants.

The warrants may be converted into equivalent number of shares on payment of the balance amount at any time on or before 28 July 2015. In the event the warrants are not converted into shares within the said period, the Company is eligible to forfeit the amounts received towards the warrants. The Company has sufficient authorised capital to cover the allotment of these shares.

Contingent liabilities and commitments

(I) CONTINGENT LIABILITIES

(Rs. In Million) Particulars As at As at 31 March 2014 31 March 2013

(a) Claims against the Company not acknowledged as debts

Sales tax / Value added tax* 16.52 16.52 Income tax* 53.50 32.87 Service tax* 0.32 0.32 Excise duty* 9.08 8.47

(b) Guarantees

Guarantees to banks and financial 500.00 303.45 institutions against credit facilities extended to subsidiaries (Refer note below)

(c) Other money for which the Company is contingently liable

Bills receivables discounted with banks 353.51 133.90

* Outflow, if any, arising out of the said claim would depend on the outcome of the decision of the appellate authority and the Company''s right for future appeal before the judiciary.

Note

(a) The Company had given a corporate guarantee to Triodos Sustainable Trade Fund towards a credit facility availed by its stepdown subsidiary (Vedic Fanxipang Pharma Chemic Company Ltd) amounting to USD 1.30 Million. During the year the same has been encashed by said fund and the balance outstanding amount of USD 0.23 Millions (INR 147.80 lakhs) has been paid by the Company. Outstanding balance as on 31 March 2014 is Rs. Nil (31 March 2013 Rs. 21.22 Million).

(b) The Company had given a corporate guarantee to Stichting Triodos Sustainable Trade Fund towards a credit facility availed by its stepdown subsidiary (Elysian Life Sciences (Mauritius) Limited) amounting to USD 1.95 Million. During the year, the loan has been repaid. Outstanding balance as on 31 March 2014 is Rs. Nil (31 March 2013 64.27 Million).

(c) the Company had given a corporate guarantee to State Bank of Hyderabad and State Bank of travancore towards a credit facility availed by its subsidiary (Sequent penems private Limited) amounting to Rs. 900 Million (previous Year Rs. 900 Million). Outstanding balance as on 31 March 2014 is Rs. 228.65 Million (31 March 2013 Rs. 217.96 Million). during the year, the same has been provided by the Company and shown under exceptional items under Note 27.

(d) the Company has given a corporate guarantee to export and Import Bank of India towards a credit facility availed by its subsidiary (Alivira Animal Health Limited) amounting to Rs. 1,250 Million. (previous Year Rs. nil). Outstanding balance as on 31 March 2014 is Rs. 500 Million (31 March 2013 Rs. nil).

Managerial Remuneration

Based on the revised approval received from the Central Government during the year, the Company has recovered excess salaries and allowances paid to its directors in the earlier years of ` 26.81 Million (Previous year ` NIL Million) and recognised it in the statement of profit and loss.

Employee benefit plans

A. DEFINED CONTRIBUTION PLANS

The Company makes provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs. 25.01 Million (Year ended 31 March 2013 Rs. 20.18 Million) for Provident Fund contributions and Rs. 1.54 Million (Year ended 31 March 2013 Rs. 2.01 Million) for Employee State Insurance Scheme contributions in the Statement of profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

B. DEFINED BENEFIT PLANS

Notes

1. The discount rate is based on the prevailing market yields of Government of India securities as at the Balance Sheet date for the estimated term of the obligations.

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

3. The Company''s best estimate, as soon as it can reasonably be determined, of contributions expected to be paid to the plan during the annual period beginning after balance sheet date is Rs. Nil (31 March, 2013 Rs. Nil)

C. Notes

1. The discount rate is based on the prevailing market yields of Government of India securities as at the Balance Sheet date for the estimated term of the obligations.

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

Related Party Disclosures:

A LIST OF RELATED PARTIES;

i) Wholly-owned subsidiaries;

SeQuent Global Holdings Limited

SeQuent European Holdings Limited (step-down subsidiary)

SeQuent Research Limited

SeQuent Antibiotics private Limited

SeQuent Oncolytics private Limited

Elysian Life Sciences private Limited (Refer Note 1)

Alvira Animal Health Limited (Refer Note 2)

ii) Other subsidiaries;

Galenica B.V.

Codiffar N.V. (wholly Owned Subsidiary of Galenica B.V.)

Elysian Health Care private Limited (wholly owned subsidiary of Elysian Life Sciences private Limited till 31 March 2013) (Refer Note 3)

Vedic Fanxipang pharma Chemic Company Limited (wholly owned subsidiary of Elysian Life Sciences private Limited)

Elysian Life Sciences Mauritius Limited (step-down subsidiary)

SEQUENT Penems Private Limited

iii) Key Management Personnel

Mr. K.R.Ravishankar, Director Dr. Gautam Kumar Das, Joint Managing Director

iv) Enterprises owned or significantly influenced by key management personnel and relative of key management personnel;

Strides Arcolab Limited

Atma projects

Agnus Holdings private Limited

Latitude projects pvt. Limited

Chayadeep properties private Limited

Desha properties

Agnus Capital LLP

Chayadeep Ventures LLP

Pronomz Ventures LLP

Note:

1 On 31 March 2013, the Company purchased additional shares in Elysian Life Sciences private Limited, resulting in it becoming a wholly owned subsidiary.

2 Alvira Animal Health Limited was incorporated on 30 September 2013.

3 On 31 March 2013, Elysian Life Sciences private Limited sold its entire shareholding of Elysian Health Care private Limited.

4 Related parties are as identified by the Company and relied upon by the Auditors.

Discontinuing operations

a. During the year, the Board of Directors of the Company have approved the transfer of Specialty Chemicals Division of the Company along with all related assets and liabilities by way of slump sale. The Specialty Chemicals Division is reported as part of the Specialty Chemicals segment of the Company as part of Segment disclosure presented in the Consolidated Financial Statements. Subsequent to the year end requisite approval from the shareholders as per the provisions of Section 180(1)(a) of the Companies Act, 2013 has been obtained through postal ballot. The transfer of the Specialty Chemicals division is expected to be completed in 2nd Quarter of financial year 2014-15.

b. During the year, the Board of Directors of the Company and the Shareholders have approved the transfer of Veterinary Formulations Division of the Company along with all related assets and liabilities by way of slump sale to Alivira Animal Health Limited, a wholly owned subsidiary of the Company. The Veterinary Formulations business is reported as part of the Pharmaceuticals segment of the Company. The transfer of the Veterinary Formulations division is expected to be completed in 3rd Quarter of financial year 2014-15.

DISCLOSURES ON EMPLOYEE SHARE BASED PAYMENTS

Employee Stock Option Scheme

a) In the extraordinary general meeting held on March 8, 2008, the shareholders approved the issue of 700,000 options under the ESOP scheme. In accordance with the above, the Company established an ESOP trust to administer the scheme on February 25, 2010.

On the board meeting dated March 29, 2010, the Company has allotted 700,000 equity shares to the ESOP trust with a Face value of Rs. 10 per share at a premium of Rs. 103 per share.

As per the scheme, the Compensation committee grants the options to the employee eligible. The exercise price and vesting period of each option shall be as decided by the compensation committee from time to time. The options granted would normally vest over a maximum period of 4 years from the date of the grant in proportions specified in the scheme. Options may be exercised with in period not exceeding 4 years from the date of first vesting of the options by the Company.

b) During the current year, the Compensation Committee in its meeting held on May 30, 2013 and February 12, 2014 has granted 540,000 and 100,000 options respectively under Sequent Scientific Employees Stock Option Plan - 2010 (Sequent ESOP 2010) to certain eligible employees of the Company. The options allotted under Sequent Scientific Employees Stock Option Plan - 2010 (Sequent ESOP 2010) are convertible into equal number of equity shares.

The vesting period of these options range over a period of 1 to 4 years. The options may be exercised within a period of 1 to 4 years from the date of vesting.

TRANSFER PRICING

In respect of Transfer pricing regulations under Section 92 to 92F of the Indian Income Tax Act, 1961, the Management confirms that its international transactions and Specified Domestic Transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for tax.

NOTE

The Company has not received a written representation from Mr. K.R.Ravishankar, one of the director of the Company as on March 31, 2014, confirming that he is not disqualified from being appointed as a director of the Company in terms of Section 274(1)(g) of the Companies Act, 1956.

NOTE

Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure. Disclosure made under Note 28 to 32 reflects combined items pertaining to continuing and discontinuing operations.

---

Mar 31, 2013

1.1 Money received against share warrants

The Board of Directors of the Company by circular resolution dated 30 March 2013 and as approved at its Extra-ordinary General Meeting held on 20 March 2013 have resolved to create, offer, issue and allot up to 2,750,000 warrants, convertible into 2,750,000 equity shares of Rs.10/- each on a preferential allotment basis, pursuant to Section 81(1A) of the Companies Act, 1956, at a conversion price of Rs.172/- per equity share of the Company, arrived at in accordance with the SEBI Guidelines in this regard and the application money amounting to Rs. 118.79 Million was received from them. The warrants may be converted into equivalent number of shares on payment of the balance amount at any time on or before 29 September 2014. In the event the warrants are not converted into shares within the said period, the Company is eligible to forfeit the amounts received towards the warrants.

1.2 Contingent liabilities and commitments

(Rs. In Million) As at 31 As at 31 March 2013 March 2012

i. CONTINGENT LIABILITIES

(a) Claims against the Company not acknowledged as debts

Sales tax / Value added tax * 16.52 16.68

Income tax * 32.87 2.08

Service tax * 0.32 0.16

Excise duty* 8.47 0.02

(b) Guarantees

Guarantees to banks and financial 303.45 260.71 institutions against credit facilities extended to subsidiaries (Refer note below)

(c) Other money for which the Company is contingently liable

Bills receivables discounted with banks 133.90 154.85

* Outflow, if any, arising out of the said claim would depend on the outcome of the decision of the appellate authority and the Company''s right for future appeal before the judiciary.

Note

(a) The Group has given a corporate guarantee to Triodos Sustainable Trade Fund towards a credit facility availed by its stepdown subsidiary (Vedic Fanxipang Pharma Chemic Company Ltd) amounting to USD 1.30 Million (Rs. 70.71 Million.) (Previous Year Rs. 66.50 Million). Outstanding balance as on 31 March 2013 is Rs. 21.22 Million ( 31 March 2012 Rs. 55.02 Million).

(b) The Group has given a corporate guarantee to Stichting Triodos Sustainable Trade Fund towards a credit facility availed by its stepdown subsidiary (Elysian Life Sciences (Mauritius) Limited) amounting to USD 1.95 Million (Rs.106.06 Million.) (Previous Year Rs. 99.76 Million). Outstanding balance as on 31 March 2013 is Rs. 64.27 Million ( 31 March 2012 Rs. 30.69 Million).

(c) The Company has given a corporate guarantee to State Bank of Hyderabad and State Bank of Travancore towards a credit facility availed by its subsidiary (Sequent Penems Private Limited) amounting to Rs. 900 Million. (Previous Year Rs. 900 Million). Outstanding balance as on 31 March 2013 is Rs. 217.96 Million ( 31 March 2012 Rs. 175 Million).

1.3 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management based on enquiries made by the Management with the creditors which have been relied upon by the auditors.

1.5 Details on derivatives instruments and unhedged foreign currency exposures

I. No derivative positions were open as at 31 March, 2013. Derviative transactions are undertaken to act as economic hedges for the Company''s exposures to various risks in foreign exchange markets and may / may not qualify or be designated as hedging instruments.

(a) Forward exchange contracts and options [being derivative instruments], which are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables.

(i) Outstanding forward exchange contracts entered into by the Company as on 31 March, 2013

1.6 Managerial Remuneration

Based on the approval received from the Central Government during the year and subsequent to the year-end, the Company has recognised in the Statement of Profit and Loss for the year ended 31 March 2013 Rs.27.70 Million of excess salaries and allowances paid to its directors and which was included under Short term loans and advances in the previous years.

2.1 Details of amalgamations

I. Amalgamation of Fraxis Life Sciences Limited with the Company:

During the previous year ended 31 March 2012, the Scheme of Amalgamation of Fraxis Life Sciences Limited ("Transferor Company”) with the Company ("Transferee Company”) was sanctioned by the High Court of Bombay on August 20, 2011 with the appointed date and effective date being September 14, 2011, the date on which the sanctioned Scheme is filed by the Company with the Registrar of Companies, Mumbai ("the Scheme”). In terms of the Scheme:

a) The amalgamation was accounted for under the Purchase Method of accounting as specified in Accounting Standard (AS) – 14 Accounting for Amalgamations, notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006.

b) All the assets and liabilities of the Transferor Company have been recorded by the Transferee Company at their respective carrying amounts as appearing in the books of the Transferor Company as on the appointed date.

c) The investment in the equity share capital of the Transferee Company as appearing in the books of accounts of the Transferor Company got cancelled and accordingly, the share capital of the Transferee Company was reduced to the extent of face value of shares held by the Transferor Company in the Transferee Company as on the appointed date.

d) The excess of the value of the net assets of the Transferor Company acquired by the Transferee Company over the face value of the shares issued by the Transferee Company as consideration to the shareholders of the Transferor Company and after adjusting for cancellation of equity share capital as mentioned in (c)above was treated as Capital Reserve amounting to NIL (net of merger expenses).

e) All costs, charges, taxes including duties, levies and all other expenses incurred in carrying out and implementing the Scheme and to put it into operation were adjusted against the Capital Reserve.

Details of assets and liabilities acquired on amalgamation and treatment of the difference between the net assets acquired and the face value of the shares issued by the Transferee Company as consideration to the shareholders of the Transferor Company and after adjusting for cancellation of equity share capital:

2.2. Related Party Disclosures

A List of related parties:

i) Holding Company:

Fraxis Life Sciences Limited (merged with the Company w.e.f September 14, 2011: Refer Note 28(1)(i))

ii) Wholly-owned subsidiaries: SeQuent Global Holdings Limited SeQuent European Holdings Limited (step-down subsidiary) SeQuent Research Limited SeQuent Antibiotics Private Limited SeQuent Oncolytics Private Limited Elysian Life Sciences Private Limited (Refer Note 1)

iii) Other subsidiaries: Galenica B.V.

Codiffar N.V. (wholly Owned Subsidiary of Galenica B.V.) Elysian Health Care Private Limited (Wholly owned Subsidiary of Elysian Life Sciences Pvt. Ltd. till 31st March 2013) (Refer Note 2) Vedic Fanxipang Pharma Chemic Company Limited (wholly owned subsidiary of Elysian Life Sciences Private Limited) Elysian Life Sciences Mauritius Limited (step-down subsidiary) Sanved Research Labs Private Limited (Refer Note 3) SeQuent Penems Private Limited (with effect from 15 March 2012)

iv) Key Management Personnel

Mr. K.R.Ravishankar, Managing Director and Chief Executive Officer

Dr. Gautam Kumar Das, Joint Managing Director

Mr. K.R.N.Moorthy, Deputy Managing Director (upto 23 January 2012)

v) Associate

SeQuent Penems Private Limited (till 15 March 2012)

vi) Enterprises owned or significantly influenced by key management personnel and relative of key management personnel: Strides Arcolab Limited Atma Projects

Agnus Holdings Private Limited Latitude Projects Pvt. Limited Chayadeep Properties Private Limited Agnus Capital LLP Chayadeep Ventures LLP

Note:

1. On 31 March 2013, the Company purchased additional shares in Elysian Life Sciences Private Limited resulting in it becoming a wholly owned subsidiary.

2. On 31 March 2013, Elysian Life Sciences Private Limited sold entire shareholding of Elysian Health Care Private Limited.

3. Sanved Research Labs Private Limited was struck off during the year ended 31 March 2012.

4. Related parties are as identified by the Company and relied upon by Auditors.

2.3. Details of leasing arrangements

The Company''s significant leasing arrangement is mainly in respect of factory building and office premises; the aggregate lease rent payable on these leasing arrangements charged to Statement of Profit and Loss is Rs.28.20 Million. (Previous Year: Rs. 12.80 Million)

The Company has entered in to non-cancelable lease arrangement for its facilities and office premises, the tenure of lease ranges from 1 year to 10 years. The said lease arrangements have an escalation clause where in lease rental is subject to an increment of ranging from 5% to 15%. Details of lease commitments are given below:

3 DISCLOSURES ON EMPLOYEE SHARE BASED PAYMENTS

a) In the extraordinary general meeting held on March 8, 2008, the shareholders approved the issue of 700,000 options under the ESOP scheme. In accordance with the above, the Company established an ESOP trust to administer the scheme on February 25, 2010.

On the board meeting dated March 29, 2010, the Company has allotted 700,000 equity shares to the ESOP trust with a Face value of Rs.10 per share at a premium of Rs. 103 per share.

As per the scheme, the Compensation committee grants the options to the employee deemed eligible. The exercise price and vesting period of each option shall be as decided by the compensation committee from time to time. The options granted would normally vest over a maximum period of 4 years from the date of the grant in proportions specified in the scheme. Options may be exercised with in period not exceeding 4 years from the date of first vesting of the options by the Company.

4 TRANSFER PRICING

In respect of Transfer pricing regulations under Section 92 to 92F of the Indian Income Tax Act, 1961, the Management confirms that its international transactions and Specified Domestic Transactions are at arm''s length so that the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for tax.

The Company has not received a written representation from Mr. K.R. Ravishankar,

5 one of the Director of the Company as on March 31, 2013, confirming that he is not disqualified from being appointed as a director of the Company in terms of Section 274 (1) (g) of the Companies Act, 1956. Previous year''s figures have been regrouped / reclassified wherever necessary to

6 correspond with the current year''s classification / disclosure.

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Mar 31, 2012

1.1 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management based on enquiries made by the Management with the creditors which have been relied upon by the auditors.

1.2 Managerial Remuneration

Salaries and Allowances paid for the year ended March 31, 2012 excludes an amount of Rs. 12.9 million (Previous year: 14.80 million) for which the Company has filed for an approval with the Central Government . Pending such approval the excess amount so paid has been disclosed as dues from directors in Note 28.3.

1.3 Details of amalgamations

i. Amalgamation of Fraxis Life Sciences Limited with the Company:

The Scheme of Amalgamation of Fraxis Life Sciences Limited (Transferor Company) with the Company (Transferee Company) has been sanctioned by the High Court of Bombay on August 20, 2011 with the appointed date and effective date being September 14, 2011, the date on which the sanctioned Scheme is filed by the Company with the Registrar of Companies, Mumbai (the Scheme). In terms of the Scheme:

a) The amalgamation has been accounted for under the Purchase Method of accounting as specified in Accounting Standard (AS) – 14 Accounting for Amalgamations, notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006.

b) All the assets and liabilities of the Transferor Company have been recorded by the Transferee Company at their respective carrying amounts as appearing in the books of the Transferor Company as on the appointed date.

c) The investment in the equity share capital of the Transferee Company as appearing in the books of accounts of the Transferor Company stands cancelled and accordingly, the share capital of the Transferee Company shall stand reduced to the extent of face value of shares held by the Transferor Company in the Transferee Company as on the appointed date.

e) The excess of the value of the net assets of the Transferor Company acquired by the Transferee Company over the face value of the shares issued by the Transferee Company as consideration to the shareholders of the Transferor Company and after adjusting for cancellation of equity share capital as mentioned in (c)above is treated as Capital Reserve amounting to Rs. 6.48 Mio.

f) All costs, charges, taxes including duties, levies and all other expenses incurred in carrying out and implementing the Scheme and to put it into operation has been adjusted against the Capital Reserve. Details of assets and liabilities acquired on amalgamation and treatment of the difference between the net assets acquired and the face value of the shares issued by the Transferee Company as consideration to the shareholders of the Transferor Company and after adjusting for

iii. Amalgamation of Vedic Elements Private Limited with the Company:

During the year ended 31 March 2011, the Scheme of Amalgamation of Vedic elements Private Limited (Transferor Company) with the Company with an Appointed Date of 1 October, 2009 (the Scheme) was sanctioned by the High Court of Karnataka and came into effect on 7 September 2010. In terms of the

Scheme:

a. The amalgamation has been accounted for under the purchase method prescribed by Accounting Standard (AS) 14 - 'Accounting for Amalgamations' notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006 and accordingly value of assets and liabilities of the transferor Company have been recorded in the books based on values determined by the Board of Directors of the transferee Company.

b. The reserves and balances in profit and loss account of the Transferor Company has been recorded in the same form and at same values as they appear in the financial statements of the transferor Company as on the appointed date.

c. The carrying value of investments in the shares of the Transferor Company held by the Transferee Company and inter-corporate balances stand cancelled.

1.4.a Related Party Disclosures:

A List of related parties:

i) Holding Company:

Fraxis Life Sciences Limited (merged with the Company w.e.f September 14, 2011: Refer Note 28(1)(i))

ii) Wholly-owned subsidiaries:

Sequent Global Holdings Limited

Sequent European Holdings Limited (step-down subsidiary)

Sequent IPCO GmbH (step-down subsidiary up to 23rd February 2011)

Sequent Research Limited

Sequent Antibiotics Private Limited

Sequent Oncolytics Private Limited

iii) Other subsidiaries:

Galenica B.V.

Codiffar N.V. (wholly Owned Subsidiary of Galenica B.V.)

Elysian Life Sciences Private Limited (Refer Note 1)

Elysian Health Care Private Limited (wholly owned subsidiary of Elysian

Life Sciences Private Limited)

Vedic Fanxipang Pharma Chemic Company Limited (wholly owned

subsidiary of Elysian Life Sciences Private Limited)

Elysian Life Sciences Mauritius Limited (step-down subsidiary)

(Refer Note 2)

Sanved Research Labs Private Limited (Refer Note 3)

Sequent Penems Private Limited (with effect from 15 March 2012)

iv) Associates:

Sequent Penems Private Limited (till 14 March 2012)

v) Key Management Personnel

Mr. K.R.Ravishankar, Managing Director and Chief Executive Officer Dr. Gautam Kumar Das, Executive Director and Chief Operating Officer Mr. K.R.N.Moorthy, Deputy Managing Director (upto 23 January 2012)

vi) Enterprises owned or significantly influenced by key management personnel and relative of key management personnel:

Strides Acrolab Limited

ATMA Projects

Agnus Holdings Private Limited

Strides Italia SRL

Strides Arcolab (FA) Limited

Latitude Projects Pvt. Limited

Strides Vital Nigeria Limited

Paradime Infrastructure Development Company

Chayadeep Properties Private Limited

Note:

1 During the previous year the Company made additional investment resulting in Elysian Life Sciences Pvt. Ltd. becoming a subsidiary from associate.

2 Elysian Life Sciences Mauritius Limited was set up during the year

3 Sanved Research Labs Private Limited was struck off during the year

4 Related parties are as identified by the Company and relied upon by Auditors.

1.5 Details of leasing arrangements

The Company's significant leasing arrangement is mainly in respect of factory building and office premises; the aggregate lease rent payable on these leasing arrangements charged to Statement of Profit and Loss is Rs.12.80 Million. (Previous Year: Rs. 13.85 Million)

The Company has entered in to non-cancelable lease arrangement for its facilities and office premises, the tenure of lease ranges from 1 year to 10 years. The said lease arrangements have an escalation clause where in lease rental is subject to an increment of ranging from 5% to 15%. Details of lease commitments are given below:

Employee Stock Option Scheme

a) In the extraordinary general meeting held on March 8, 2008, the shareholders approved the issue of 700,000 options under the ESOP scheme. In accordance with the above, the Company established an ESOP trust to administer the scheme on February 25, 2010.

On the board meeting dated March 29, 2010, the Company has allotted 700,000 equity shares to the ESOP trust with a Face value of Rs.10 per share at a premium of Rs. 103 per share.

As per the scheme, the Compensation committee grants the options to the employee deemed eligible. The exercise price and vesting period of each option shall be as decided by the compensation committee from time to time. The options granted would normally vest over a maximum period of 4 years from the date of the grant in proportions specified in the scheme

Options may be exercised with in period not exceeding 4 years from the date of first vesting of the options by the Company.

2 PREVIOUS YEAR'S FIGURES

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

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Mar 31, 2011

1. Amalgamation of Vedic Elements Private Limited with the Company:

The Scheme of Amalgamation of Vedic elements Private Limited ("Transferor Company") with the Company with an Appointed Date of 1 October, 2009 (the Scheme) has been sanctioned by the High Court of Karnataka and came into effect on 7 September 2010. In terms of the Scheme:

a. The amalgamation has been accounted for under the purchase method prescribed by Accounting Standard (AS) 14 – Accounting for Amalgamations notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006 and accordingly value of assets and liabilities of the transferor Company have been recorded in the books based on values determined by the Board of Directors of the transferee company.

b. The reserves and balances in profit and loss account of the Transferor Company has been recorded in the same form and at same values as they appear in the financial statements of the transferor Company as on the appointed date.

c. The carrying value of investments in the shares of the Transferor Company held by the Transferee Company and inter-corporate balances stand cancelled.

e. The deficit arising on amalgamation of Rs. 337.02 Million representing the value of assets over the value of liabilities of the Transferor Company, after cancellation of capital of the transferor Company and the reserves recorded as per point 'd', has been set-off against Restructuring reserve account as created in point 'd' above post-merger

2. With effect from April 1, 2010, the merger of parent company, Fraxis Life Science limited, with the Company has been approved by the respective Board of the directors. The Company is in the process of obtaining approval from High Court of Mumbai in this regard.

3. Exceptional items

a) Based on The Scheme of Amalgamation of Vedic elements Private Limited, the company valued its investment at fair value and net provision for diminution in the value of Investment of Rs.52.58 Million has been reversed.

b) The Company had given a corporate guarantee to Rabo bank, Netherland towards a loan availed by its subsidiary (Galenica B.V.) amounting to Euro 0.665 Million (Rs.42.05 Mio). Since the subsidiary has filed for liquidation, the corporate guarantee was encashed during the year by the Bank and the same is charged under exceptional items.

4. Estimated amounts of contracts remaining to be executed on capital account and not provided for (Net of advances) Rs.147.78 Mio (previous year Rs. 66.50 Mio)

5. Contingent Liabilities

(Rs. In Million)

Particulars As at As at March 31, 2011 March 31, 2010

Sales tax* 16.62 13.20

Income tax* 10.75 11.11

Excise Duty* 0.09 -

Bills Receivables 133.70 97.03 discounted with banks

Total 161.16 121.34

*Outflow, it any, arising out of the said claim would depend on the outcome of the decision of the oppellate authority and the Company's right for future appeal before the judiciary.

The Company has given a Corporate Guarantee to Triodos Sustainable Trade Fund, Vietnam towards a Credit facility availed by its stepdown subsidiary (Vedic Fanxipang Pharma Chemic Company Ltd) amounting to USD 1.30 Million. (Rs.58.05 Million) (Previous Year Rs. Nil) However the step down subsidiary has used facility to an extent of USD 0.7 Million (Rs. 31.26 Million) (Previous Year Rs. Nil) as at the year end.

6. The information disclosed in Schedule H.A (a) to the financial statements with regard to Micro and Small enterprises is based on information collected by the management based on enquiries made by the management with the creditors which have been relied upon by the auditors.

The Company has paid remuneration to one of its director as per the approval received from Central Government. The Managerial Remuneration paid for the year ended March 31, 2011 excludes Rs. 24.88 million for which the Company is in the process of filing for approval with Central Government. Pending such approval the excess amount so paid has been disolved as dues from directors in Schedule G.B. (g).

b. Computation of Net Profit in accordance with Section 349 of the Companies Act, 1956:

13. Related Party Disclosures LIST OF RELATED PARTIES:

Holding Company:

Fraxis Life Sciences Ltd.

Wholly-owned subsidiaries:

SeQuent Global Holdings Ltd.

SeQuent European Holdings Ltd. (step-down subsidiary)

SeQuent IPCO GmbH (step-down subsidiary up to 23rd February 2011)

Vedic Elements Pvt. Ltd. (Merged with the Company w.e.f.1st October 2009)

SeQuent Research Ltd.

SeQuent Antibiotics Pvt. Ltd.

SeQuent Oncolytics Pvt. Ltd.

Subsidiaries:

Galenica B.V.

Codiffar N.V. (wholly Owned Subsidiary of Galenica B.V.)

Elysian Life Sciences Pvt. Ltd. (Refer note 1 below)

Elysian Health Care Pvt. Ltd. (wholly owned subsidiary of Elysian

Life Sciences Pvt. Ltd.)

Vedic fanxipang Pharma Chemic Company Ltd. (wholly owned

subsidiary of Elysian Life Sciences Pvt. Ltd.)

Sanved Research Labs Pvt. Ltd.

Associates:

SeQuent Penems Pvt. Ltd. (Refer note 2 below.)

Key Management Personnel and Enterprises owned or significantly influenced by key management personnel and relative of key management personnel:

Mr. K.R.Ravishanker –Managing Director and Chief Executive Officer

Mr. K.R.N.Moorthy, Deputy Managing Director (W.e.f.8th September 2010)

Dr. Gautam Kumar Das, Executive Director and Chief Operating

Officer

Strides Acrolab Ltd.

ATMA Projects

Agnus Holdings Pvt. Ltd.

Strides Italia SRL (step-down subsidiary)

Strides Arcolab (FA) Ltd.

Latitude Projects Pvt. Ltd.

Strides Vital Nigeria Ltd.

Deesha Properties

Paradime Infrastructure Development Company (Formerly known as Paradime Resorts)

Note:

1. During the year the Company has made additional investment resulting in Elysian Life Sciences Pvt. Ltd. becoming a subsidiary from associate.

2. During the year the Company incorporated SeQuent Penems Pvt. Ltd.(Sequent Penems) as a subsidiary. Subsequently, Sequent Penems made a preferential allotment of shares to SeQuent Speciality chemicals Pvt. Ltd. resulting in SeQuent Penems Pvt. Ltd. becoming an associate as at the year end.

3. Related parties are as identified by the Company and relied upon by the Auditors.

14. Taxation

(a) Provision for deferred tax has been created in accordance with the requirements of Accounting Standard 22" Accounting for taxes on Income"

26. Employee Stock Options Scheme

a) In the extraordinary general meeting held on March 8, 2008, the shareholders approved the issue of 700,000 options under the ESOP scheme. In accordance with the above, the Company established an ESOP trust to administer the scheme on February 25, 2010. On the board meeting dated March 29, 2010, the Company has allotted 700,000 equity shares to the ESOP trust with a Face value of Rs.10 per share at a premium of Rs. 103 per share.

As per the scheme, the Compensation committee grants the options to the employee deemed eligible. The exercise price and vesting period of each option shall be as decided by the compensation committee from time to time. The options granted would normally vest over a maximum period of 4 years from the date of the grant in proportions specified in the scheme. Options may be exercised with in period not exceeding 4 years from the date of first vesting of the options by the Company.

27. Notes on Cash flow statement:

(a) The cash flow has been prepared under Indirect method as set out in Accounting Standard – 3 on Cash Flow Statement" issued under The companies (Accounting Standards) Rules 2006.

(b) Previous year figures have been regrouped/ reclassified wherever necessary to conform to current year's

(c) Cash and Cash Equivalent include balance with banks on lien for letter of credits issued of Rs. 58.57 Million (previous year Rs. 36.08 Million) which are not available for use of the Company.

(d) The amalgamation of Vedic Elements Private Limited with the Company with effect from the appointed date of October 1, 2009 being a non cash transaction has not been reflected in the cash flow statement ((Refer Note B 1 of Schedule P)

28. Previous year figures have been regrouped in line with the current year, wherever necessary.

29. Figures of current year are not comparable with that of previous year as figure for current year include the figure of Vedic Elements Private Limited, Pursuant to Scheme of amalgamation.

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Mar 31, 2010

1. (a) Amalgamation of Sequent Scientific Limited with the Company:

The Scheme of Amalgamation of Sequent Scientific Limited ("Transferor Company") with the Company with an Appointed date of 1 April, 2008 (the Scheme) has been sanctioned by the High Court of Bombay and came into effect on 16 September 2009. In terms of the Scheme:

a. The amalgamation has been accounted for under the purchase method prescribed by Accounting Standard (AS) 14 – Accounting for Amalgamations notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006 and accordingly value of assets and liabilities of the transferor Company have been accounted at fair values based on an independent valuation report or at values determined by the Management and as approved by the Board of DirectoRs.

b. All assets and liabilities of the Transferor Company have been transferred to and vested in the Company retrospectively with effect from April 1, 2008.

c. Seven equity shares of Rs.10 each were allotted for every three equity shares held by the shareholders of the Transferor Company resulting in the allotment of 10,150,000 shares of Rs.10 each to the shareholders of the Transferor Company.

d. The net deficit on amalgamation of Rs.163.00 million representing the excess of shares allotted over the fair value of net assets amalgamated has been set off against the balance in the Securities Premium Account.

e. The assets and liabilities as at April 1, 2008 taken over have been accounted at their fair values as follows:

(b) During the previous year, the Company had acquired all the assets and liabilities of its wholly owned subsidiary company Elixir Chemicals Private Limited (Elixir) with effect from the Appointed Date April 1, 2007, pursuant to a scheme of Amalgamation of Elixir Chemicals Private Limited with the Company as approved by the Honourable High Court of Bombay vide order dated March 20, 2009. Since the Amalgamating Company was wholly owned subsidiary company, no consideration was paid as per the scheme.

The said amalgamation was in the nature of merger and had been accounted as pooling of interest method in accordance with the Accounting Standard 14 Accounting for Amalgamations issued by the Institute of Chartered Accountants of India and as per the treatment prescribed by the scheme. The Accounting treatment followed was as under:

1. All the assets and liabilities of Elixir, as appearing in the books as on April 1, 2007, were recorded in the books of the Company at the respective book values.

2. Difference between carrying cost of the investment in the Elixir as appearing in the books of the Company and the net assets of Elixir of Rs. 32. 47 Mio was adjusted in General Reserve as per the scheme.

3. Elixirs profit after tax for the year ended 31st March 2008 amounting to Rs. 4.89 Mio was credited to the General Reserve account.

4. The inter-company balance of Rs. 76.37 Mio as on 1st April 2008 as appearing in the books of Elixir and the Company was eliminated.

2. Proposed Amalgamation of Vedic Elements Private Limited, a wholly owned subsidiary of the company:

The Scheme of Amalgamation of Vedic Elements Private Ltd (VEPL) with the Company from October 1, 2009 has been approved by Board of Directors of the respective companies in their meeting held on January 27, 2010. Under the scheme all, assets and liabilities of VEPL will be transferred and recorded in the books as per valuation report or value determined by the Management of the Company. Upon the Scheme becoming effective, the shares held by the Company in VEPL shall be cancelled and extinguished and no shares will be issued by the VEPL in consideration of this scheme of amalgamation. The scheme is pending approval of the High Court and therefore no effect has been given to this scheme in this financials.

3. Estimated amounts of contracts remaining to be executed on capital account Rs. 82.95 Mio (previous year Rs. 12.78 Mio)

4. Contingent Liabilities

(Rs. in million)

As at As at

Particulars March 31, March 31,

2010 2009

Bank guarantee and 2.40 25.17

letter of credits

Sales tax 13.20 -

Income tax 11.11 0.62

Bills Receivables 97.03 -

discounted with banks

Total 123.56 25.79

The Company has given a Corporate guarantee to Rabo bank, Netherlands towards a loan secured by its subsidiary (Galenica BV) amounting to Euro.0.6 Millions. (Rs.36.62 Million) (Previous Year : Rs. Nil)

5. The information disclosed in Schedule G.A (a) to the financial statements with regard to Micro and Small enterprises is based on information collected and enquiries made by the management with the creditors which have been relied upon by the auditoRs.

6. Managerial Remuneration:

A. Remuneration paid by the Company to the Managing Director and Whole-time director:

B. Computation of Net Profit in accordance with Section 349 of the Companies Act, 1956:

7. Un-hedged Foreign Currency Exposure

The year-end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are given below:

8. Details of Hedged Foreign Currency Exposure:

Forward Exchange Contracts, which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables, outstanding as on March 31, 2010 are given below:

9. Segment Reporting:

The Company has identified Pharmaceuticals and Specialty Chemicals as its business segments. Segments have been identified taking into account the nature of services, the differing risks & returns, the organizational structure & the internal reporting system. Since the Company prepares consolidated financial statements, segment information has not been provided in these financial statements.

10. Employee Benefits:

The Company has a defined benefit gratuity plan. The following table summarises the components of net employee benefit expenses recognised in the profit and loss account and the funded status and amounts recognised in the balance sheet for the respective plans.

11. Related Party Disclosures

List of related parties:

Holding Company:

Fraxis Life Sciences Private Limited

Wholly-owned subsidiaries:

SeQuent Global Holdings Limited

Sequent European Holdings Limited (step-down subsidiary)

Sequent IPCO GmbH (step-down subsidiary)

Vedic Elements Private Limited

Vedic Fanxipang Pharma Chemic Company Limited,Vitenam (step-down subsidiary)

Sequent Research Limited

Sanved Research Labs Private Limited

Galenica B.V. (subsidiary)

Codifar N.V. (wholly owned subsidiary of Galenica B.V.)

Associates

Elysian Life Sciences Private Limited

Elysian Health Care Private Limited (wholly owned subsidiary of Elysian Life Sciences Private Limited)

Key Management Personnel & Enterprises owned or significantly influenced by key management personnel and relative of key management personnel:

Mr. K.R.Ravishankar –Managing Director & Chief Executive Officer

Mr Gautam Kumar Das, Executive Director & Chief Operating Officer (w.e.f. January 7, 2010)

Mr. S.N.Jagannath - Executive Director (Resigned w.e.f January 6, 2010)

Strides Acrolab Limited

Linkace Limited, Cyprus

ATMA Projects

Agnus Holdings Private Limited

Latitude Projects Private Limited

Strides Vital Nigeria Limited

Strides Italia S.r.l. (In Liquidation)

Deesha Properties

Deesha Fine Chemicals

Paradigm Resorts

Agnus Global Holdings Pte Limited, Singapore

Agnus IPCO Limited, British Virgin Islands

Note: Related parties are as identified by the Company and relied upon by the AuditoRs.

12. Taxation

(a) Provision for deferred tax has been created in accordance with the requirements of Accounting Standard 22 “Accounting for taxes on Income”

(b) Net Deferred tax liability comprises the tax impact arising from timing differences on account of:

13. Research & Development Expenditure

a) Details of Research and Development expenditure

b) As per the requirement of Department of Scientific and industrial research (DSIR), Ministry of Science and technology, Government of India, New Delhi, the details of expenditure incurred by the company towards Research and Development for the period April,1, 2009 to March 2010 are as under:

14. Expenditure Debited to the Profit & Loss Account excludes the following expenditure capitalised:

15. Operating Leases:

The Companys significant leasing arrangement is mainly in respect of factory building & office premises; the aggregate lease rent payable on these leasing arrangements charged to Profit & Loss Account is Rs.10.74 Million. (Previous Year : Rs. 4.24 Million)

The Company has entered in to non cancelable lease arrangement for its facilities and office premises, the tenure of lease ranges from 1 year to 10 yeaRs. The said lease arrangements have an escalation clause where in lease rental is subject to an increment of ranging from 5% to 10 %. Details of lease commitments at the year-end are as follows.

16. The quantitative information for purchases, production, consumption and stock of raw material, finished goods are given as under.

17. Particulars of Traded Goods:

None of the items individually account for more than 10% of the total value of the purchases, stock or turnover, hence quantitative details have not been furnished.

18. Employee Stock Options Scheme

In the extraordinary general meeting held on March 8, 2008, the shareholders approved the issue of 700,000 options under the ESOP scheme. In accordance with the above, the Company established an ESOP trust to administer the scheme on February 25, 2010.

On the board meeting dated March 29, 2010, the Company has allotted 700,000 equity shares to the ESOP trust with a Face value of Rs.10 per share at a premium of Rs. 103 per share.

19. Notes on Cash Flow Statement:

(a) The Cash flow has been prepared under Indirect method as set out in Accounting Standard -3 on “Cash Flow Statement” issued under The Companies (Accounting Standards) Rules 2006.

(b) Previous years figures have been regrouped/ reclassified wherever necessary to conform to current years classification.

(c) Cash and Cash Equivalent include balance with banks on lien for letter of credits issued of Rs. 36.08 Million (PY Rs. 13.50 Million) which are not available for use by the Company

(d) The amalgamation of erstwhile Sequent Scientific Limited with the Company with effect from the appointed date of April 1, 2008 being a non-cash transaction has not been reflected in the cash flow statement (Refer Note B(1a) above)

20. Figures for current year are not comparable with those of the previous year as the figures for the current year include the figures of the amalgamating Company, Sequent Scientific Limited.

21. Previous year figures have been regrouped wherever necessary.