Morepen Laboratories Ltd. — Annual Report 2019

Aug 19, 2019

...

Date: 19/08/2019

To,

National Stock Exchange of India Limited Exchange Plaza, Bandra Kurla Complex, Bandra (East), Mumbai- 400 051 Tel No: (022) 26598100-8114 Fax No: (022) 26598120 Symbol: MOREPENLAB

BSE Limited

Floor 25, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai- 400 001 Phones: 91-22-22721233/4 Fax: 91-22-2272 3121 Scrip Code: 500288

Subject: Notice of the 34th Annual General Meeting(' AGM') and Book Closure

Dear Sir,

Pursuant to Regulation 30 read with Part A of Schedule III and Regulation 34(1) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulation, 2015, please find enclosed Annual Report of the Morepen Laboratories Limited (the 'Company') for the financial year 2018-19 along with the Notice of the 34th Annual General Meeting scheduled to be held on Friday, September 13, 2019 at 10.00 A.M. (I.S.T.) at the registered office of the at Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh -173 205;

In this regard, the Company has provided facility to exercise voting rights on all business proposed at the AGM by electronic means by using remote e-voting facility provided by National Securities Depositories Ltd (NSDL). The remote e-voting period shall commence from Monday, September 09, 2019 at 9.00 a.m. and will end on Thursday, September 12, 2019 at 5.00 p.m., and the shareholders of the Company as at the cut-off date i.e., Friday, September 06,2019 (end of day) shall be . eligible to vote using the remote e-voting facility.

Further, pursuant to the provisions of Section 91 of Companies Act, 2013 read with Rule 10 of the Companies (Management and Administration) Rules, 2014 and Regulation 42 of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, the Register of Members and Register of Share Transfer of the Company will

More pen Laboratories Limited '

Corp. Off.: 4th Floor,Antriksh Bhawan, .22 K. 110 001, INDIA Tel. :+91-11-23324443,23712025, E-mail: Website:www.morepen.com CIN NO. L24231 HP1984PLC006028

Plant & Regd. Off.: Morepen Village, Malkumajra, Nalagarh Road, Baddi, Distt. Solan (H.P.) -'173205 Tel.: +91-1795-266401-03, 244590, Fax: +91-1795-244591, E-mail: plants@morepen.com .

be closed from Saturday, September 07, 2019 to Friday, September 13, 2019 (both days inclusive) for the purpose of AGM.

Kindly take note of the same.

Thanking you.

Yours faithfully,

Encl.: As Above

Morepen Laboratories Limited

Corp. Off.: 4th Floor,Antriksh Bhawan, 22 K.G.Marg, New Delhi- 110 001, INDIA Tel. :+91-11-23324443,23712025, E-mail: corporate@morepen.com,Website:www.morepen.com CIN NO. L24231 HP1984PLC006028

Plant & Regd. Off.: Morepen Village, Malkumajra, Nalagarh Road, Baddi, Distt. Solan (H.P.) -173205 Tel.: +91 -1795-266401-03, 244590, Fax: +91-1795-244591 , E-mail: plants@morepen.com

CORPORATE INFORMATION

Chairman & Managing Director Mr. Sushil Suri M/s. Satinder Goyal & Co.

Whole-time Director Cost Auditors

Independent Directors Secretarial Auditor

Mr. Manoj Joshi Mr. Praveen Dua Mr. Bhupender Raj Wadhwa M/s. PD and Associates Mr. Sukhcharan Singh Company Secretaries

Mrs. Anju Suri MAS Services Ltd.

Chief Financial Officer Company Secretary

Registered Office Corporate Office th Morepen Village, Nalagarh Road 4 floor, Antriksh Bhawan Near Baddi, Distt. Solan 22, Kasturba Gandhi Marg Himachal Pradesh - 173 205 New Delhi - 110 001

Statutory Auditors

Chartered Accountants

Dr. Arun Kumar Sinha M/s. Vijender Sharma & Co. Cost Accountants

Non-Executive Director Registrar & Share Transfer Agent nd T-34, 2 Floor, Okhla Industrial Area Phase - II, New Delhi - 110 020

Mr. Ajay Sharma Mr. Vipul Kumar Srivastava

Contents

Directors' Report	1
Annexures to the Director's Report (Including Corporate Governance Report)	10
Independent Auditors' Report	51
Balance Sheet	57
Statement of Profit and Loss	58
Cash Flow Statement	59
Statement of changes in Equity	60
Company Overview and Significant Accounting Policies	61
Notes on Financial Statements	67
Independent Auditors' Report on Consolidated Financial Statements	81
Consolidated Balance Sheet	87
Consolidated Statement of Profit and Loss	88
Consolidated Cash Flow Statement	89
Consolidated Statement of changes in Equity	90
Company Overview and Significant Accounting Policies	91
Notes on Consolidated Financial Statements	97
Notice of AGM	110
Route Map of AGM Venue	127
Proxy Form	128
E-communication Registration Form	130

DIRECTORS' REPORT

Dear Shareholders,

th Your Directors have pleasure in presenting the 34 Annual Report on business, operations and achievements of the Company st together with the audited financial statements for the financial year ended 31 March, 2019.

FINANCIAL HIGHLIGHTS (` in Lakhs)

Particulars		Standalone		Consolidated
	2018-19	2017-18	2018-19	2017-18
Sales	70,597.21	55,294.67	75,621.44	59,775.29
Other Operating Income	1,127.08	788.37	1,232.40	875.62
Other Income	367.18	354.01	367.18	372.27
Total Income	72,091.47	56,437.05	77,221.02	61,023.18
Operating Surplus	6,869.22	6,380.93	7,118.96	6,845.02
Finance cost	207.08	429.46	211.00	435.73
Cash Surplus	6,662.14	5,951.47	6,907.96	6,409.29
Non-Cash Items:
Depreciation & Amortisation	3,800.78	3,339.95	3,990.29	3,432.20
Profit before Tax	2,861.36	2,611.52	2,917.67	2,977.09
Tax	(212.70)	–	(246.33)	–
Tax credit entitlement	212.70	–	212.70	–
Profit before non-controlling interest	2,861.36	2,611.52	2,884.04	2,977.09
Less : Non - controlling interest	–	–	(0.89)	17.95
Profit after non-controlling interest	2,861.36	2,611.52	2,884.93	2,959.14
Other Comprehensive Income	(171.82)	10.95	(169.81)	8.87
Total Comprehensive Income	2,689.54	2,622.47	2,715.12	2,968.01
EPS (Basic/Diluted)	0.64	0.58	0.64	0.66

A significant topline growth of 22.43% has been recorded in counter) topline, the Company has recorded its highest ever Active Pharmaceutical Ingredients (API) business of the sales revenues in each of its aforementioned businesses. On company. The Company has been able to sustain its growth overall basis, total annual revenues are at 77,221.02 Lakhs momentum despite the fact that supplies of inputs against61,023.18 Lakhs recorded during the previous particularly imported raw materials has been quite patchy financial year, a growth of 26.54%. during the current year. It also led to stress in margins in API Financial Performance: business even though a part of increased costs were passed Sales on to the customers. The Company continues to invest in Current year consolidated sales revenues at 75,621.44 new processes, capacities and systems with a view to remain Lakhs have recorded an incredible growth of 26.50% against competitive in its area of operations. Both domestic and previous year revenues of59,775.29 Lakhs. Current year exports markets have registered attractive growth.

The Formulation business with its current year sales previous year revenues. Export business has contributed revenues of `153.17 Crores has posted a growth of 39% over around 41% of the consolidated sales revenues of the previous year sales revenues. The Home Diagnostics Company and registered a growth of 32% during the year. business has been consistent in its annual growth trajectory On standalone basis, the Company registered sales revenues with current year revenues scoring growth of 35% over

REVIEW OF PERFORMANCE previous year revenues. With 11% growth in OTC (over the

total revenues of `77,221.02 Lakhs are up by 26.54 % over

a-vis 2,968.01 Lakhs of previous year. Consolidated material cost, as a percentage of sales, has gone up to 65.65% as compared to 61.66% in the previous On standalone basis, the Company has registered Net profits year, primarily because of hardening of raw material prices. of2,861.36 Lakhs as against 2,611.52 Lakhs during Current year sales realizations have been better as part of the previous financial year. Total Comprehensive Income for the increased input costs have been passed on to the customers year stood at2,689.54 Lakhs vis-a-vis `2,622.47 Lakhs of to maintain the margins. previous year.

During the year under review, the employee strength of the Active Pharmaceutical Ingredients (API) Company has increased by around 11%. The current year's API business with its current year annual sales revenues of consolidated employee cost is 12.61% of the sales revenue 41,304.70 Lakhs is up by 22.43% against preceding year against 12.80% in the preceding year. The overall increase revenues of33,738.91 Lakhs. There has been huge growth in employee cost for the current year is both on account of in exports business of the Company at around 32% and annual merit based increase as well as on account of domestic business marginally grew by 1% in its annual

Consolidated expenditure on manufacturing, sales & growth has not kept pace with last year growth levels. marketing and administrative activities has come down to Loratadine, Montelukast and Atorvastatin recorded 14.43% of sales revenues, against 16.17% recorded in the excellent growth in their annual revenues at 28%, 33% and previous year. Despite recording tremendous growth in sales 25% respectively. revenues, the Company has been able to keep in check on Finished API's with current year annual revenues of it's spend on various administrative and sales & marketing `35,809.40 Lakhs has recorded a growth of 19% during the

come down by around 52% against previous year cost of growth of 33%. 435.73 Lakhs. Depreciation & Amortisation cost for the With annual sales revenue of14,344.51 Lakhs, Loratadine year has been at 3,990.29 Lakhs against3,432.20 Lakhs of continues to be leading revenue generator for the API previous year, an increase of 16.26%, mainly on account of business closely followed by Montelukast with sales revenue increased amount of amortisation for the year and additional of `12,075.43 Lakhs recorded during the current year.

against 777.32 Lakhs of last year. Others are up by 38.78%1,680.33 Lakhs against 2,196.67 Lakhs of last year. at138.81 Lakhs during the current year as against `98.30 API business has recorded a compounded annual growth Lakhs in the previous year. rate (CAGR) of 17.59% during last 5 years.

Consolidated other income representing currency Home Diagnostics fluctuations and interest income at `367.18 Lakhs, is The Home Diagnostics portfolio has recorded steadfast

Consolidated Profit before interest, depreciation and tax is during last 5 years. Blood Gluco Monitoring business with higher at 7,118.96 Lakhs as against6,845.02 Lakhs in the current year revenues of 9,284.67 Lakhs, has registered a previous year. Net profit after tax but before share of profit CAGR of 41% during last 5 years. Gluco monitors from non-controlling interest is at2,884.04 Lakhs against installations during the current year have been 25% more `2,959.14 Lakhs in last financial year. Consolidated net than the previous year and expected to cross 3 million very

of 70,597.21 Lakhs as compared to55,294.67 Lakhs profit, exclusive of minority share, is at 2,884.93 Lakhs, during previous financial year, a growth of 27.67%. marginally down by 2.5% over previous years' profit. Total **Material Cost** Comprehensive Income for the year is2,715.12 Lakhs vis-

Employee Cost Division wise Business Performance:

increased manpower. revenues. The price realisation has been better during the Other Expenses year as compared to last financial year. However, volume

activities. year. The sales revenues for new molecules have increased Finance Cost & Depreciation by 15% at 2,965.18 Lakhs. Intermediates with their annual Consolidated annual finance cost at211.00 Lakhs has sales revenues of `2,530.12 Lakhs have recorded revenue

depreciation charge on assets discarded during the year. Atorvastatin with its annual revenues of 7,201.25 Lakhs **Other Operating Income & Other Income** registered a growth of 25% during the current year. Consolidated other operating income represents export Rosuvastatin sales revenues, for the year under review, are at incentives, income from foreign operations & others.3,038.00 Lakhs against 2,885.91 Lakhs of preceding year. Current year export incentives are at1,093.59 Lakhs Fexofenadine sales revenue for the current year is down at

marginally down from previous year of `372.27 Lakhs. growth over last many years and has recorded a Profit after Tax compounded annual growth rate (CAGR) of around 29%

soon. The glucose testing strips have registered a staggering any dividend due to absence of distributable surplus. growth of 52% during the current year. RESERVES

Blood Pressure Monitors with current year Sales revenues of Standalone net profit after tax of `2,861.36 Lakhs is carried the previous year. It has recorded a CAGR of 35% during last review, no amount was transferred to the General Reserve. 5 years. DEPOSITS

Nebulisers with current year sales revenue of 872.49 Lakhs Your Company has not accepted any deposits from the also recorded a robust growth of around 49% in this fiscal, public, during the year under review, within the meaning of whereas Thermometers with current year sales revenue of Section 73 of the Companies Act, 2013 ('the Act') read with564.95 Lakhs has gone up by 21%. the Companies (Acceptance of Deposits) Rules, 2014, and

public was outstanding as on the date of Balance Sheet. home at affordable prices, the Company has also started in st house manufacture of Blood Glucose Strips in May 2018 During the financial year ended 31 March, 2010, the along with Blood Glucose Monitors. The Company has Company had allotted 9,24,90,413 Equity Shares to the become self-reliant in the production of Glucometers. It has fixed deposit holders in settlement of their dues pursuant to manufactured 8 Lakh Blood Glucose Monitors in the current the Scheme of Arrangement & Compromise under Section Blood Glucose Monitors in India and the SAARC region. The High Court of Himanchal Pradesh, Shimla vide its order th company has started adopting state of the art robotic dated 4 August, 2009. In an appeal preferred by the Central technology in its production process of medical devices to Government before Division Bench of Hon'ble High Court th replaced import of around US\$ 1.2 Million during the order dated 14 September, 2010 set aside the order of the th current year. The Company has plans to start production of Hon'ble Single Judge dated 4 August, 2009 and remanded Nebulizer & Thermometers in the near future. Home the case back to the Hon'ble Single Judge to decide the Diagnostics business has remarkable growth every year & petition afresh after hearing all the parties and considering will be achieving many more milestones in coming years. the representation of the Central Government.

The Company has also invested heavily in Glucometers On the constitution of National Company Law Tribunal placement in the market to expand the customer base by (NCLT), this petition under Section 391 of the Companies supplying these free or at the subsidized cost. The Act, 1956, was later transferred to the Chandigarh Bench of th investment has helped the Company to expand its customer NCLT. The Hon'ble NCLT, Chandigarh, on 12 March, base for the glucose strips and is also expected to pay off in 2018, dismissed the Company's petition seeking approval of

yet been transferred by original allottees (FD holders) and 15,317.43 Lakhs is up by 39% over previous year revenues of payment of dues, as per Company Law Board order within 311,045.84 Lakhs. It has been growing steadily over the months from the date of receipt of the certified copy of the years with last 5 years' CAGR of 15%. The Branded Prescription (Rx) products with annual sales revenues of judgment. 3,425.86 Lakhs have recorded massive growth of 33% Aggrieved by the aforesaid judgement of Hon'ble NCLT, the during the period under review. Branded generics business Company had filed an appeal before the Hon'ble NCLAT, has also recorded glittering performance during the year and New Delhi, praying, inter-alia, for setting aside of the order has added11,891.57 Lakhs to the company's topline passed by the Hon'ble NCLT, Chandigarh and approve the against 8,473.98 Lakhs added last year. The top three Scheme of arrangement with Fixed Deposit (FD) holders. therapeutic categories namely Antibiotics, Gastroenteritis The Hon'ble NCLAT, New Delhi, vide its judgement dated and Vitamins contributed2,588.83 Lakhs to the topline of rd 23 July, 2019 has upheld the impugned judgement passed branded formulation business, against `1,926.49 Lakhs th by the Hon'ble NCLT, Chandigarh, dated 12 March, 2018. added last year.

`2,649.77 Lakhs has posted handsome growth of 22% over forward to the Retained Earning. During the year under

no amount of principal or interest on deposits from the In line with its commitment of delivering good health at

year. This makes Morepen one of the largest Manufacturer of 391 of the Companies Act, 1956, approved by the Hon'ble improve quality and efficiency. Glucometer production has of Himachal Pradesh at Shimla, the Division Bench vide its

the coming years. the Scheme of arrangement with the Fixed Deposit holders. The Hon'ble NCLT directed the Company to cancel the Finished Formulations The current year sales revenue for the Finished Dosages at shares issued, under the aforesaid scheme, which have not

The company is seeking advice for evaluating remedies DIVIDEND available under the law, including filing of appeal in the For the year under review, the Directors do not recommend higher courts. After evaluating the advice so received, the 1. Dr. Morepen Ltd. Company will take such necessary steps as may be required 2. Total Care Ltd. (subsidiary of Dr. Morepen Ltd.) concerning the finality of the order of the Court.

FINANCES

Dr. Morepen Limited The management is working towards improvement in The consumer business of the Company being promoted performance of the Company so as to be able to derive under brand 'Dr. Morepen' and carried under wholly owned maximum value to its investors. All the business segments subsidiary Dr. Morepen Limited, is growing steadily with a are given due attention so that capital is preserved and long CAGR of 12% during last 5 years. On standalone basis the term growth can be sustained.

paid and cleared in full during the current year, on the terms post completion of debt servicing. as approved by lenders of the Company. From now onwards

Shares issued to lenders under the Corporate Debt recorded huge growth of 73% during the year. Restructuring (CDR) Scheme and also to other entities as per product reach and availability. approval of all the stakeholders will work out a scheme

come. March, 2019, was ` 8,995.86 Lakhs.

Total Care Limited The Equity Shares issued by the Company are listed at

• 1. BSE Limited (BSE) during the year.

Annual listing fee for the financial year 2019-20 has been Morepen Inc. paid to both the Stock Exchanges. The Equity Shares Morepen Inc. is the marketing and distribution interface of continue to be listed on both NSE and BSE. the Company in USA for its API business, various OTC &

recorded a growth of 21% with revenue at 105.32 Lakhs the Company, having accumulated losses, from payment of (\$153409) as against87.25 Lakhs (\$134,606) in the dividends on Preference Shares. As a result, dividends on previous year. The company has recorded a profit of 18.97 Preference Shares have not been paid for more than two Lakhs against loss of31.65 Lakhs in the preceding year. years, thereby making the holders of these shares entitled to vote on all resolutions placed before the Company. The CONSOLIDATED FINANCIAL STATEMENTS st proportion of voting rights of Equity Shareholders to the The consolidated financial statements for the year ended 31 voting rights of Preference Shareholders shall be in March, 2019 has been prepared in accordance with Indian proportion to their paid up capital. Accounting Standards (Ind AS) notified under the

st previous year ended 31 March, 2019. namely:

• 1. Morepen Inc., USA

company has recorded a topline of 5438.08 Lakhs as Balance restructured debt, as per Corporate Debt against4,890.71 Lakhs recorded in the preceding year, Restructuring Scheme approved in the July 2006 has been growth of 11%. The management expects to put more focus

The Company's primary brands like Burnol (Burn Cream), all the internal accruals will be available for all round growth Lemolate (Cough & Cold) and Fiber-X (Sat Isabgol) have of all business verticals of the Company. registered a modest growth of 2% over last year revenues of Under the provisions of the Act past accumulated losses 1,990.94 Lakhs. Other small distribution and reach based restricts the ability of the Company to redeem Preference brands with sales revenue of552.32 Lakhs have also

The Company expects to continue its growth in the OTC and CDR terms. As a result, the Company has not been able to Brand Sharing business with the continuous focus on new redeem these Preference Shares, although they had become product addition, entering new markets and increasing due for redemption. The Company in consultation and

which is in the interest of all the stakeholders. The Grooming business, launched few years back, has registered growth of 45% in its annual revenues at `939.82 SHARE CAPITAL Lakhs. The company expects considerable rise in both During the year under review, there was no change in the st topline as well bottom line for the business in the years to paid-up equity share capital of the Company which as on 31

st The Company is dealing in OTC & Health Care products. following Stock Exchanges as on 31 March, 2019: The scale of Company's operations continues to be minimal 1. National Stock Exchange of India Limited (NSE) since past few years with no operating revenue recorded

other products. During the year under review, the Company The provisions of the Act have placed statutory restriction on

Companies (Indian Accounting Standards) Rules, 2015 SUBSIDIARIES / JOINT VENTURES / ASSOCIATES st together with the comparative period data as at and for the The Company has three subsidiaries as on 31 March, 2019,

In accordance with the Companies Act, 2013 and Indian

Financial Statements' read with Ind AS 112 on 'Disclosure of of Managerial Personnel) Rules, 2014, as amended or

th 2019, at 34 Annual General Meeting. In accordance with the provisions of Section 129(3) of the

re-appointment of Mr. Sushil Suri, Chairman and Managing re-appointment as Independent Directors on the Board, in Director of the Company, who was liable to retire by rotation accordance with the provisions of Section 149 of Companies pursuant to the provisions of Section 152 and other Act, 2013, read with Companies (Appointment and applicable provisions of the Act read with Companies Qualification of Directors) Rules, 2014, as amended from (Appointment and Qualification of Directors) Rules, 2014, time to time, in the ensuing Annual General Meeting. as amended or re-enacted from time to time.

The members also approved the re-appointment of Pursuant to the provisions of Section 149 of the Act, the Mr. Sushil Suri, Chairman & Managing Director of the independent directors have submitted declarations that each th Company, who holds office up to 19 October, 2018 and of them meet the criteria of independence as provided in being eligible, has offered himself for re-appointment Section 149(6) of the Act along with Rules framed pursuant to the provisions of Section 196, 197, 198, 203, thereunder and Regulation 16(1)(b) of the Securities and Schedule V and other applicable provisions of the Exchange Board of India (Listing Obligations and Disclosure (Appointment and Remuneration of Managerial Personnel) Regulations"). There has been no change in the Rules, 2014, as amended or re-enacted from time to time as circumstances affecting their status as independent directors the Chairman & Managing Director of the Company, for of the Company. th another term of 5 years w.e.f., 20 October, 2018.

During the year under review, Mr. Thomas P. Joshua, Pursuant to the provisions of the Act and Regulation 17 of Company Secretary and Key Managerial Personnel, has Listing Regulations, the Board has carried out its own th been resigned from the said position w.e.f., 24 September, performance evaluation, that of the Committees and the 2018 and Mr. Vipul Kumar Srivastava is appointed by the individual performance of its Directors. The manner in Board of Directors as Company Secretary and Key which the evaluation has been carried out has been provided th Managerial Personnel w.e.f., 12 November, 2018. in the 'Corporate Governance Report'.

Mrs. Anju Suri, Director of the Company, who is liable to Familiarization Programme for Independent Directors retire by rotation pursuant to the provisions of Section 152 The details pertaining to Familiarization Programme for and other applicable provisions of the Act read with Independent Directors has been incorporated in 'Corporate Companies (Appointment and Qualification of Directors) Governance Report'. Rules, 2014, as amended or re-enacted from time to time, Meetings of Board of Directors has given her consent and being eligible has offered herself th The Board of Directors met 5 (five) times during the year for re-appointment, in the 34 Annual General Meeting.

Your Directors also recommend the re-appointment of details of which are given in 'Corporate Governance Report'. Mr. Arun Kumar Sinha, Whole-Time Director of the st Independent Directors Meeting Company, who holds office up to 31 March, 2019 and During the year under review, a separate meeting of the being eligible, has offered himself for re-appointment th Independent Directors of the Company was held on 04 pursuant to the provisions of Section 196, 197, 198, 203, February, 2019, without the presence of Non-Independent and other applicable provisions of the Companies Act, 2013

Accounting Standards (Ind AS) 110 on 'Consolidated and read with Companies (Appointment and Remuneration Interest in other entities', the Audited Consolidated Financial re-enacted from time to time as the Whole-Time Director of st Statements is provided in the Annual Report. the Company, for another term of 3 years w.e.f., 1 April,

Act, read with the Companies (Accounts) Rules, 2014, a Mr. Manoj Joshi (DIN: 00036546), Mr. Sukhcharan Singh report on the performance and financial position of each of (DIN: 00041987) and Mr. B.R. Wadhwa (DIN: 00012096), the subsidiaries is attached as ANNEXURE 'A' to this Report have given their consent to act as an Independent Director of in the prescribed form, AOC-1. the Company pursuant to Section 152 of Companies Act, DIRECTORS & KEY MANAGERIAL PERSONNEL 2013, read with Rule 8 of Companies (Appointment and Qualification of Directors) Rules, 2014 and have offered Changes in Directors & Key Managerial Personnel themselves to be re-appointed for an another term of 5 (five) rd The members at the 33 Annual General Meeting (AGM) of th consecutive years commencing from 19 September, 2019 st the Company held on 21 September, 2018 approved the th to 18 September, 2024. Your directors recommend their

Declaration by Independent Director(s)

Companies Act, 2013 and read with Companies Requirements) Regulations, 2015 ("SEBI Listing

Evaluation of Board, Committees and Directors

under review, to transact the business of the Company, the

Directors and members of the Management. The 5(1) of the Companies (Appointment and Remuneration Independent Directors reviewed the performance of Non- of Managerial Personnel) Rules, 2014 is annexed and Independent Directors and the Board as a whole, forms part of this report as ANNEXURE 'B'. performance of Chairperson of the Company and assessed b) The Statement containing the particulars of employees

• within statutory prescribed timeline. wherever applicable;
• Company. true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of AUDIT COMMITTEE

• provisions, is given in the 'Corporate Governance Report'. safeguarding the assets of the Company and for prevention and detecting of fraud and other WHISTLE BLOWER POLICY / VIGIL MECHANISM

• f) proper systems to ensure compliance with the cases. The same is reviewed by the Audit Committee from provisions of all applicable laws have been devised and time to time. that such systems were adequate and operating RISK MANAGEMENT

MANAGERIAL REMUNERATION AND OTHER about the risk assessment and minimisation procedures and

Disclosure pursuant to Section 197 of the Act read with Rule through means of a properly defined framework. 5 of the Companies (Appointment and Remuneration of The Company has formulated and adopted Risk

a) Ratio of the remuneration of each Director to the median management, reporting and disclosure requirements remuneration of the employee's (MRE) and other details of the Company. pursuant to Section 197 (12) of the Act read with Rule

• the quality, quantity and timelines of flow of information as required under section 197(12) of the Companies Act between the Company Management and the Board. All the 2013 read with Rule 5(2) and other applicable Rules (if Independent Directors of the Company were present in the any) of the Companies (Appointment and Remuneration meeting. of Managerial Personnel) Rules, 2014, is provided in a DIRECTORS' RESPONSIBILITY STATEMENT separate annexure forming part of this report. Further, As required under Section 134(3)(c) of the Act, your the report and the accounts are being sent to the Directors, to the best of their knowledge and belief and members excluding the aforesaid annexure. In terms of according to the information and explanations obtained by Section 136 of the Companies Act, 2013 the said them, confirm that: annexure is open for inspection at the Registered and Corporate office of the Company during the working a) in the preparation of annual accounts, the applicable hours. Any member interested in obtaining a copy of the accounting standards have been followed, along with same may write to the Company and obtain the copy proper explanation relating to material departures,
• c) No Director of the Company, including its Managing b) your Directors have selected such accounting policies Director or Whole-Time Director, is in receipt of any and applied them consistently and made judgments and commission from the Company or its Subsidiary estimates that are reasonable and prudent so as to give a

the Company for that period; Your Company has an Audit Committee in compliance of the provisions of Section 177 of the Act and Regulation 18 of c) your Directors have taken proper and sufficient care for Listing Regulations. The complete details with respect to the maintenance of adequate accounting records in Audit Committee, as required to be given under the aforesaid accordance with the provisions of the Act for

irregularities; The Company has established a Whistle Blower Policy/Vigil Mechanism through which its Directors, Employees and d) the annual accounts have been prepared on a going Stakeholders can report their genuine concern about concern basis; unethical behaviors, actual or suspected fraud or violation of e) internal financial controls to be followed by the the Company's Code of Conduct or Ethics Policy. The said Company have been laid down and such internal policy provides for adequate safeguard against victimization financial controls are adequate and were operating and also direct access to the higher level of superiors effectively; and including Chairman of the Audit Committee in exceptional

effectively. The Company has in place a mechanism to inform the Board DISCLOSURES periodical review to ensure that management controls risk

Managerial Personnel) Rules, 2014: Management Policy to prescribe risk assessment,

Your Company has a Nomination and Remuneration Employee's State Insurance (ESI), Provident Fund (PF), Committee in compliance to the provisions of Section 178 of Income Tax and GST dues. The Company has however, the Act and Regulation 18 of Listing Regulations. The deposited all the dues in respect of ESI, PF, GST and Income complete details with respect to the salient features of Tax (TDS) for the year under review. The Company is taking Nomination and Remuneration Committee, as required to requisite steps for timely deposit of above noted dues. be given under the aforesaid provisions, is given in the SECRETARIAL AUDIT 'Corporate Governance Report'. Pursuant to the provisions of Section 204 of the Act read with

The Company has adopted a Nomination and Remuneration Companies (Appointment and Remuneration of Managerial Policy for Directors, Key Managerial Personnel (KMP) and Personnel) Rules, 2014, Mr. Praveen Dua, Company other employees of the Company as formulated by Secretary, Proprietor of M/s. PD and Associates, Company Nomination and Remuneration Committee, pursuant to Secretaries, was appointed by Board of Directors of the provisions of Section 178 of the Act and Para A of Part D of Company as Secretarial Auditors of the Company for the Schedule II of Listing Regulations, which acts as a guideline financial year 2018-19. The Secretarial Audit Report is for determining, inter-alia, qualifications, positive attributes annexed and forms part of this report as ANNEXURE 'C'. and independence of a Director, matters relating to the EXPLANATION TO SECRETARIAL AUDIT REPORT remuneration, appointment, removal and evaluation of The Secretarial Auditor has observed that the Company has performance of the Directors, Key Managerial Personnel, not redeemed the Preference Shares due for redemption.

The Company has made the requisite changes in accordance been explained in Note No. 18 to the Financial Statements st of the Companies Act, 2013, as amended, and SEBI (Listing for the year ended 31 March, 2019. Obligations and Disclosure Requirements) Regulations, SECRETARIAL STANDARDS 2015, as amended. The detailed policy formulated by The Company has devised proper systems to ensure Nomination and Remuneration Committee can be accessed compliance with the provisions of all applicable Secretarial at http://www.morepen.com/pdf/Nomination-and- Standards issued by the Institute of Company Secretaries of

STATUTORY AUDITORS effectively.

M/s. Satinder Goyal & Co. (Chartered Accountants FRN: COST AUDIT 027334N), the Statutory Auditors of the Company, were Pursuant to Section 148 of the Act, read with the Companies Annual General Meeting, to be held in the year 2022, in the ensuing Annual General Meeting. subject to ratification of appointment by the members at INTERNAL FINANCIAL CONTROLS every Annual General Meeting.

EXPLANATION TO AUDITORS REPORT with the applicable laws.

NOMINATION AND REMUNERATION COMMITTEE Auditors' Report have commented on delay in deposit of

Senior Management and other employees. The reasons for not redeeming the Preference Shares have

Remuneration-Policy.pdf India and that such systems are adequate and operating

nd appointed by the shareholders in the AGM held on 22 (Cost Records and Audit) Rules, 2014, the Cost Accounting September, 2017, pursuant to provisions of Section 139, Records maintained by the Company in respect of its Bulk 141, 142 and other applicable provisions, if any, of the Act, Drugs and Formulations activity are required to be audited read with the Companies (Audit and Auditors) Rules, 2014 by Cost Auditors. The Board of Directors of the Company (including any statutory modification(s) or re-enactment has, on the recommendation of the Audit Committee, thereof, for the time being in force) and subject to all the appointed M/s. Vijender Sharma & Co., Cost Accountants, as applicable laws and regulations for a term of five (5) the Cost Auditor of the Company for the financial year ended consecutive years to hold office from the conclusion of the st 31 March, 2020, at a remuneration of ` 2.00 Lakhs, subject nd th 32 Annual General Meeting until the conclusion of 37 to the ratification of their remuneration by the shareholders

The Company has an Internal Control System, The requirement to place the matter relating to appointment commensurate with the size, scale and complexity of its of auditors for ratification by Members at every AGM has operations. The internal financial controls are adequate and been done away by the Companies (Amendment) Act, 2017 are operating effectively so as to ensure orderly and efficient th with effect from 7 May, 2018. Accordingly, no resolution is conduct of business operations. The Company's internal being proposed for ratification of appointment of Statutory financial control procedures ensure that Company's Auditors at the ensuing Annual General Meeting. financial statements are reliable and prepared in accordance

The Auditors vide Para (vii)(a) of the Annexure-A to the To maintain its objectivity and independence, the Internal

Audit Team reports to the Chairman of the Audit Committee In the matter of cross appeals filed by the Company and

circumstances. the activities to be undertaken by the Company as specified in Schedule VII. In the matter of prosecutions filed by the Registrar of

its Directors pursuant to Section 235 of the erstwhile of CSR Committee, CSR Policy, CSR initiatives and activities Companies Act, 1956, the Company is defending against the during the year is annexed and forms part of this report as

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION EXTRACT OF ANNUAL RETURN AND REDRESSAL) ACT, 2013

The Company has in place a policy on Prevention, Prohibition and Redressal of Sexual Harassment of Women at Workplace pursuant to the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal MATERIAL CHANGES AND COMMITMENTS AFFECTING Complaints Committee (ICC) has been set up to redress THE FINANCIAL POSITION OF THE COMPANY complaints received regarding sexual harassment. The Except from the liabilities which may arise in respect of policy has set guidelines on the redressal and enquiry payment to FD holders as per the order of Hon'ble NCLAT, rd process that is to be followed by complainants and the ICC, dated 23 July, 2019 which has upheld the order of NCLT th while dealing with issues related to sexual harassment at the dated 12 March, 2018, there have been no material work place. All women employees whether permanent, changes and commitments, affecting the financial position temporary, contractual and trainees are covered under this of the Company, which have occurred between the end of policy. The Company has not received any complaint during the financial year of the Company and the date of this report.

The Company had allotted 75,17,540 Equity Shares as per AND OUTGO w.r.t., two allottees is pending from Stock Exchanges. As forms part of this report as ANNEXURE 'F'. advised by the Stock Exchanges, the Company has PARTICULARS OF LOANS, GUARANTEES OR approached SEBI for grant of exemption, which is still INVESTMENTS

of the Board. Based on the internal audit report, process Central Government before Hon'ble Supreme Court of India owners undertake corrective action in their respective areas against the impugned judgement of the Hon'ble High Court and thereby strengthening the controls. Significant audit of Himachal Pradesh appointing two government nominees observations and corrective actions thereon are presented to on the board of the company for 3 years under provisions of the Audit Committee of the Board. Team engaged in internal erstwhile Companies Act, 1956, the Hon'ble Supreme Court th audit carries out extensive audits throughout the year across vide its Order dated 9 July, 2019, has held that no all functional areas, and submits its reports from time to time interference in the aforesaid decision of Hon'ble High Court to the Audit Committee of the Board of Directors. is called for. It further held that it would be open for the Company to agitate the subsequent events before the CORPORATE SOCIAL RESPONSIBILITY concerned forum. The company is seeking the legal advice The Corporate Social Responsibility (CSR) Committee of the th for approaching jurisdictional National Company Law Company was constituted by the Board on 10 May, 2016 to Tribunal (NCLT) for placing on record the subsequent monitor implementation of CSR activities by the Company events, inter-alia, payment to the creditors post the Orders in accordance with Section 135 read with Schedule VII of passed by the Hon'ble High Court of Himachal Pradesh and the Act. Based on the recommendation of the CSR to adjudicate in the light of the present facts and Committee, your Board has adopted a CSR Policy indicating

Companies/Central Government against the Company and The Report on CSR Activities with details of the composition said prosecutions before the Court and the matter is under ANNEXURE 'D'. adjudication.

The detailed extract of Annual Return in Form MGT-9 as required under Section 134(3)(a) of the Act is annexed and forms part of this report as ANNEXURE 'E'. The same is available at the website of the Company at http://www.morepen.com/pdf/Annual-Return.pdf

the year. CONSERVATION OF ENERGY, TECHNOLOGY LEGAL & CORPORATE MATTERS ABSORPTION AND FOREIGN EXCHANGE EARNINGS

Corporate Debt Restructuring ('CDR') Scheme approved by The information relating to Conservation of Energy, the CDR Cell. These shares were allotted on preferential Technology Absorption and Foreign Exchange Earnings and basis to the Banks/ Financial Institutions. Out of total issued outgo, as required under Section 134(3)(m) of the Act read Equity Shares, the listing approval for 3,75,750 Equity Shares with the Companies (Accounts) Rules, 2014 is annexed and

awaited. Details of Loans, Guarantees and Investments covered under

the provisions of Section 186 of the Act are given in the notes out in the Management Discussion and Analysis Report. to the Financial Statements. CORPORATE GOVERNANCE

PARTICULARS OF CONTRACTS OR ARRANGEMENTS A Report on Corporate Governance along with a certificate WITH RELATED PARTIES from the Practicing Company Secretary regarding

All the related party transactions that were entered into compliance with conditions of Corporate Governance as during the financial year were on arm's length basis and in stipulated in Part E of Schedule V of Listing Regulations forms the ordinary course of business. During the year under part of this report and is annexed as ANNEXURE 'H'. review there were no materially significant related party ACKNOWLEDGEMENTS transactions, including arm's length transactions; hence, Your Directors place on record their gratitude to the Central

around operational performance. Analysis Report pursuant to Part B of Schedule V of Listing

A detailed review of Human Resources of the Company is set

9 10 ANNEXURE 'A' FORM AOC - 1: STATEMENT CONTAINING SALIENT FEATURES OF THE FINANCIAL STATEMENTS OF SUBSIDIARIES/ ASSOCIATE COMPANIES/JOINT VENTURES (Pursuant to first proviso to Sub-Section (3) of Section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014) PART A : SUBSIDIARIES (in Lakhs) Name of the Subsidiary Company **Dr. Morepen Limited Total Care Limited Morepen Inc.** Reporting period for the subsidiary concerned, if different 01-04-2018 to 31-03-2019 01-04-2018 to 31-03-2019 01-04-2018 to 31-03-2019 from the holding company's reporting period Reporting currency and Exchange rate as on the last date of – – US\$/68.65 the relevant Financial year in the case of foreign subsidiaries (As on 31.03.2019) Share Capital 4,067.95 933.39 22.23 (4,06,79,500 Equity Shares of (9,33,390 Equity Shares of (9,400 Fully paid shares of disclosure in Form AOC – 2 is not required. Government, State Government, Drug Control Authorities, The complete details with respect to contracts or Company's Bankers, GMP Consultants, Auditors, Medical & arrangements with related parties as required to be given Legal Professionals and business partners/for the assistance, under the Act and Part C of Schedule V of Listing Regulations co-operation and encouragement they extended to the is given in the 'Corporate Governance Report'. Company. Your Directors also wish to place on record their MANAGEMENT DISCUSSION AND ANALYSIS REPORT sincere thanks and appreciation for the continuing support and unstinting efforts of investors, vendors, dealers, business A detailed review of the operations and performance of the associates and employees in ensuring an excellent all Company is set out in the Management Discussion and

Regulations which forms part of the Annual Report for the Your Directors look forward to your continued support in year under review as ANNEXURE 'G'. our efforts to grow together and enhance health through delivery of quality products. HUMAN RESOURCES

For and on behalf of Board of Directors

Sushil Suri Place: New Delhi (Chairman & Managing Director) th Date: 27 July, 2019 DIN: 00012028

100%	% 95	100%	Percentage of Shareholding
–	–	–	Proposed Dividend
18.97	(17.76)	21.47	Profit after Taxation
5.57	12.53	15.52	Provision for Taxation
24.54	(5.23)	36.99	Profit/(Loss) before Taxation
105.32	–	5,438.12	Turnover
–	–	1,171.00	Investments
186.45	4.09	5,888.41	Total Liabilities
186.45	4.09	5,888.41	Total Assets
100.43	(1,859.48)	(254.12)	Reserves & Surplus
(9,400 Fully paid shares of 22.23 US\$1 each)	(9,33,390 Equity Shares of 933.39 100/- each) | (4,06,79,500 Equity Shares of<br>10/- each) 4,067.95	Share Capital
	–	–	the relevant Financial year in the case of foreign subsidiaries Reporting currency and Exchange rate as on the last date of
	01-04-2018 to 31-03-2019	01-04-2018 to 31-03-2019	Reporting period for the subsidiary concerned, if different from the holding company's reporting period
	Total Care Limited	Dr. Morepen Limited	Name of the Subsidiary Company
		(Pursuant to first proviso to Sub-Section (3) of Section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014)
A' RE ' U X NE N A	CI N A N FI HE T OF RES	U AT FE RES T N U ALIE T N T VE S G N N	OI NI NIES/J AI T N O A MP C T O N ATE C ME ATE CI ST O ARIES/ ASS 1: C - O A DI M BSI R O U F S
OF (in Lakhs)<br>Morepen Inc.<br>01-04-2018 to 31-03-2019<br>US\$/68.65 (As on 31.03.2019) TS N ME ATE ST AL			PART A : SUBSIDIARIES

PART B: ASSOCIATES & JOINT VENTURES - N.A.

Sushil Suri

For and on behalf of Board of Directors

ANNEXURE 'B' DETAILS OF REMUNERATION PURSUANT TO SECTION 134(3)(q) AND SECTION 197(12) OF THE ACT READ WITH RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014

A. Ratio of the remuneration of each Director to the Median remuneration of the employees of the Company;

Name of the Director	Designation	Ratio of Remuneration to Median Remuneration of Employees
Mr. Sushil Suri	Chairman & Managing Director	45.13
Dr. A. K. Sinha	Whole-time Director	2.23
Mr. B. R. Wadhwa*	Independent Director	0.63
Mr. Sukhcharan Singh*	Independent Director	0.71
Mr. Manoj Joshi*	Independent Director	0.76
Ms. Anju Suri	Non-Executive Director	N.A.

Percentage increase in remuneration of each Director, Chief Financial Officer, Chief Executive Officer and Company Secretary in the financial year;

Name of the Director/KMP	Designation	% increase of remuneration in F.Y. 2018-19
Mr. Sushil Suri	Chairman & Managing Director	114.60%
Dr. A. K. Sinha	Whole-time Director	(59.09%)
Mr. B. R. Wadhwa*	Independent Director	70.00%
Mr. Sukhcharan Singh*	Independent Director	146.75%
Mr. Manoj Joshi*	Independent Director	78.26%
Ms. Anju Suri	Non-Executive Director	N.A.
Mr. Ajay Kumar Sharma	Chief Financial Officer	7.99%
1 Mr. Thomas P. Joshua	Company Secretary	(64.47%)
2 Mr. Vipul Kumar Srivastava	Company Secretary	N.A.

¹ th ² th Resigned w.e.f., 24 September, 2018; Appointed w.e.f., 12 November, 2018.

* These Directors of the Company are paid sitting fees only;

B. The percentage increase in the median remuneration of employees in the F.Y. 2018-19 was 9.51%.

st C. The number of permanent employees on the rolls of the Company as on 31 March, 2019 was 1376.

D. The average percentile increase in the salaries of the employees other than the managerial personnel in the F.Y. 2018-19 was 23.21% while increase in Managerial remuneration was 44.58%.

E. It is hereby affirmed that the remuneration is as per Remuneration Policy of the Company.

For and on behalf of Board of Directors

Sushil Suri Place: New Delhi (Chairman & Managing Director) th Date: 27 July, 2019 DIN: 00012028

(Form No. MR-3) SECRETARIAL AUDIT REPORT st (FOR THE FINANCIAL YEAR ENDED 31 MARCH, 2019)

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To, as amended;

I have conducted the Secretarial Audit of the compliance of Regulations, 2009 as amended; applicable statutory provisions and the adherence to good (d) The Securities and Exchange Board of India corporate practices by Morepen Laboratories Limited (Employee Stock Option Scheme and Employee (hereinafter called the 'Company'). Secretarial Audit was Stock Purchase Scheme) Guidelines, 1999; conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts/statutory compliances (e) The Securities and Exchange Board of India (Issue and expressing my opinion thereon. and Listing of Debt Securities) Regulations, 2008

as amended; Based on my verification of the Company's books, papers, minute books, forms and returns filed and other records (f) The Securities and Exchange Board of India maintained by the Company and also the information (Registrars to an Issue and Share Transfer Agents) provided by the Company, its officers, agents and authorized Regulations, 1993 regarding the Companies Act representatives during the conduct of Secretarial Audit, I and dealing with client; hereby report that in our opinion, the Company has, during (g) The Securities and Exchange Board of India st the audit period covering the financial year ended on 31 (Delisting of Equity Shares) Regulations, 2009; and March, 2019 complied with the statutory provisions listed hereunder and also that the Company has proper Board- (h) The Securities and Exchange Board of India processes and compliance-mechanism in place to the extent, (Buyback of Securities) Regulations, 1998, as amended; in the manner and subject to the reporting made hereinafter:

(vi) Drugs and Cosmetics Act, 1940 and Drugs and I have examined the books, papers, minute books, forms and Cosmetics Rules, 1945; returns filed and other records maintained by the Company st for the financial year ended on 31 March, 2019 according to (vii) Drugs (Price Control) Order, 2013; the provisions of:

• (i) The Companies Act, 2013 (the 'Act') and the Rules (ix) Legal Metrology Act, 2009; and made there under;
• (x) Trademark Act, 1999. (ii) The Securities Contracts (Regulation) Act, 1956
• clauses of the following: (iii) The Depositories Act, 1996 and the Regulations and
• Requirements) Regulations, 2015, as amended. rules and regulations made there under to the extent Investment and External Commercial Borrowings; Company Secretaries of India (ICSI).

• (v) The following Regulations and Guidelines prescribed I further report that:

• (Prohibition of Insider Trading) Regulations, 2015 the Act;

• The Members, (c) The Securities and Exchange Board of India (Issue Morepen Laboratories Limited of Capital and Disclosure Requirements)

• (viii) Indian Boilers Act, 1923;

('SCRA') and the rules made there under; I have also examined compliance with the applicable

• Bye-laws framed there under; (i) The provisions envisaged in The Securities and Exchange Board of India (Listing Obligations and Disclosure (iv) Foreign Exchange Management Act, 1999 and the
• of Foreign Direct Investment, Overseas Direct (ii) The Secretarial Standards issued by the Institute of the

under the Securities and Exchange Board of India Act, (a) the Board of Directors of the Company is duly 1992 ('SEBI Act'): constituted with proper balance of Executive Directors, (a) The Securities and Exchange Board of India Non-Executive Directors and Independent Directors. (Substantial Acquisition of Shares and Takeovers) The changes in the composition of the Board of Regulations, 2011, as amended; Directors that took place during the period under review (b) The Securities and Exchange Board of India were carried out in compliance with the provisions of

• (b) adequate notice is given to all directors to schedule the 97,35,20,100/- due for redemption during the f.y. 2014-15; Board Meetings, agenda and detailed notes on agenda (iv) 2,00,000 0.01% Cumulative Redeemable Preference were sent at least seven days in advance and a system Shares (CRPS) of ` 100 each/- aggregating to clarifications on the agenda items before the meeting f.y. 2011-12; and for meaningful participation at the meeting;
• (c) all the resolutions have been passed unanimously and Shares (CRPS) of ` 100 each/- aggregating to
• f.y. 2003-04. (d) there are adequate systems and processes in the Company commensurate with the size and operations of For PD and Associates Company Secretaries the Company to monitor and ensure compliance with
• Company confirms that all transactions, including increase in remuneration, are in the ordinary course of To, business and at arm's length; The Members
• (f) the Company has not paid dividend to preference Morepen Laboratories Limited shareholders for more than two years and hence the Our report of even date is to be read along with this letter. preference shareholders are entitled to vote on all the 1) Maintenance of the secretarial record is the matters in the General Meetings. No preference responsibility of the management of the Company. Our shareholder has attended the Annual General Meeting responsibility is to express an opinion on these held during the previous year. secretarial records based on our audit.
• (g) The Hon'ble NCLT, Chandigarh vide its order dated 2) We have followed the audit practices and processes as payment in lieu thereof. provide a reasonable basis for our opinion.

st Accounts of the Company. Meeting of the company held on 21 September, 2018 and regulations and happening of events, etc. Chairman and Managing Director of the company apart from

shares are still pending, which were due to be redeemed as limited to the verification of procedures on test basis.

• (i) 7,65,000 0.01% Cumulative Redeemable Preference the future viability of the Company nor of the efficacy or ` 7,65,00,000/- due for redemption during the conducted the affairs of the Company. f.y. 2017-18; For PD and Associates
• Company Secretaries (ii) 7,65,000 0.01% Cumulative Redeemable Preference Shares (CRPS) of 100 each/- aggregating to 7,65,00,000/- due for redemption during the CS Praveen Dua f.y. 2016-17; (Proprietor)

• (iii) 97,35,201 0.01% Optionally Convertible Preference Place: New Delhi FCS No.: 3573 th Shares (OCPS) of 100 each/- aggregating to Date: 27 July, 2019 C P No.:2139

• exists for seeking and obtaining further information and ` 2,00,00,000/- due for redemption during the

• (v) 5,00,000 9.75% Cumulative Redeemable Preference did not find any dissenting views in the minutes; ` 5,00,00,000/- due for redemption during the

applicable laws, rules, regulations and guidelines;		CS Praveen Dua
(e) the Company has entered into related party transactions		(Proprietor)
for the sale and purchase of material/products and	Place: New Delhi	FCS No.: 3573
paying remuneration to related party personnel. The	th Date: 27 July, 2019	C P No.:2139

• th 12 March, 2018 had set aside the scheme in respect of were appropriate to obtain reasonable assurance about fixed deposit (FD) holders. The Hon'ble NCLAT has the correctness of the contents of the Secretarial records. upheld the order of Hon'ble NCLT, directing The verification was done on test basis to ensure that cancellation of the shares allotted to various FD holders correct facts are reflected in secretarial records. We who has not traded/transfered their shares and making believe that the processes and practices, we followed
• 3) We have not verified the correctness and I further report that during the audit period the company appropriateness of financial records and Books of has got the approval of members in the Annual General
• 4) Wherever required, we have obtained the Management the company has obtained consent of the members for the representation about the compliance of laws, rules and re-appointment and remuneration of Mr. Sushil Suri as
• other ordinary business. 5) The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the I further report that redemption of following preference responsibility of management. Our examination was
• under: 6) The Secretarial Audit report is neither an assurance as to Shares (CRPS) of ` 100 each/- aggregating to effectiveness with which the management has

ANNEXURE 'D'

ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES

(Pursuant to Section 135 of the Companies Act, 2013)

I. Brief outline of the Corporate Social Responsibility (CSR) Policy

The Company's CSR Policy is in pursuance of the provisions of Section 135, Schedule VII and other applicable provisions of the Companies Act, 2013 read with Companies (Corporate Social Responsibility Policy) Rules, 2014. The Board of Directors of the Company has adopted the CSR Policy formulated and recommended by the CSR Committee and the same is available on the Company's website at http://www.morepen.com/pdf/Corporate-Social-Responsibility-Policy.pdf.

The Company undertakes the CSR activities through K.B. Suri Memorial Trust which runs a Charitable Dispensary at Katra, Jammu & Kashmir and through Gyan Jyoti Education Foundation which provides Education and General Public Utility to the deprived sections of the Society.

II. Composition of CSR Committee of the Board

The CSR Committee of the Board comprises of Mr. Sushil Suri, Chairman of the Committee, Mr. Manoj Joshi and Mr. B. R. Wadhwa as members.

III. Average Net Profits, prescribed CSR expenditure and details of CSR spent	` ( in Lakhs)
Particulars	Amount
Average net profit of the Company for the last 3 financial years	2,157.38
Prescribed CSR Expenditure (2% of the average net profits)	43.15
Details of CSR Expenditure during the financial year:
Total amount to be spent for the financial year	43.15
Amount unspent	Nil

` Manner in which amount is spent on CSR activities during the financial year are detailed below: ( in Lakhs)

CSR Project or activity identified	Sector in project is covered	Location which the of project (District & State)	Amount outlay (budget) project or program programs wise	Amount spent on the projects or programs Direct expenditure on project or programs	Overheads	Cumulative expenditure up to the reporting period	Amount spent directly or through implementing agency
Promotion of healthcare including preventive healthcare	Health	Katra, Jammu & Kashmir	32.55	32.55	–	92.04	K.B. Suri Memorial Trust (Implementing Agency)
Education and General Public Utility	Education & Vocational Training etc.	Guwahati, Assam	10.60	12.51	–	12.51	Gyan Jyoti Education Foundation (Implementing agency)
Total			43.15	45.06	–	104.55

The Company has undertaken the CSR activities through K.B. Suri Memorial Trust which contributes in the promotion of healthcare including preventive healthcare and manages the 'Jai Durga Charitable Dispensary' situated at Main Bazaar, Katra, Near Hanuman Mandir, Jammu & Kashmir. The dispensary caters to the urgent medical needs of pilgrims, staff employed in hotels, dharamshalas, pony and pithu porters, local public and public of nearby areas by providing OPD services and necessary medicines free of cost. Further, the dispensary also caters to medical needs of Police and CRPF personnel deployed at Katra. More than 100 patients visit the dispensary every day in the OPD facility mostly for treatment of hypertension, diabetes, acute gastritis, gastrointestinal infections, urinary tract infections, upper respiratory tract infections, lower respiratory tract infections and injuries of monkey bite amongst other medical needs.

During the year, the Company has also undertaken CSR activities through Gyan Jyoti Education Foundation (the foundation) which is currently operates its 26 training centres with a capacity to train people every year. Training centres are a combination of owned, franchised, shared and government-aided centres under Public Private Partnership. The foundation has certified numerous candidates till date on various streams through its team of highly qualified trainers and Business Associates.

The foundation brings in a fresh approach based on its expertise in integrating technology, training methods, knowledge management and quality system to transform delivery of vocational training.

IV. Responsibility Statement

We hereby affirm that the CSR Policy, as approved by the Board, has been implemented and the CSR Committee monitors the CSR projects and activities in compliance with the CSR objectives and Policy of the Company.

For Morepen Laboratories Limited

Sushil Suri (Chairman & Managing Director) Place: New Delhi (Chairman - CSR Committee) th Date: 27 July, 2019 DIN: 00012028

ANNEXURE 'E'

FORM NO MGT-9: EXTRACT OF ANNUAL RETURN st AS ON FINANCIAL YEAR ENDED 31 MARCH, 2019

[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

i)	CIN	:	L24231HP1984PLC006028
ii)	Registration Date	:	01/12/1984
iii)	Name of the Company	:	MOREPEN LABORATORIES LIMITED
iv)	Category / Sub-Category of the Company	:	Public Company / Limited by Shares
v)	Address of the Registered office and contact details	:	Morepen Village, Malkumajra, Nalagarh Road, Baddi, Distt. Solan, Himachal Pradesh – 173 205 Tel No.: +91-01795-276201-03 Fax No.: +91-01795-276204 Email Id: investors@morepen.com
vi)	Whether listed Company	:	Yes
	vii) Name, Address and Contact details of Registrar and Transfer Agent, if any	:	MAS Services Limited nd T-34, 2 Floor, Okhla Industrial Area, Phase-II, New Delhi – 110020 Tel No.: +91-11-2638 7281/82/83 Fax No.: +91-11-26387384 Email id: info@masserv.com

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10% or more of the total turnover of the Company:

Name and Description of main Products/Services	NIC Code of the Products/Services	% to Total Turnover of the Company
Pharmaceuticals	21001 and 21002	100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

S.	Name and Address	CIN/GLN	Holding/	% of Shares	Applicable
No.	of the Company		Subsidiary/ Associate	held	Section
1.	Dr. Morepen Limited 220, Antriksh Bhawan, 22, K.G. Marg, New Delhi-110 001	U24232DL2001PLC111636	Subsidiary	100	2 (87)
2.	Total Care Limited nd 2 Floor, Antriksh Bhawan, 22, K.G. Marg, New Delhi-110 001	U24246DL2000PLC105296	Subsidiary	95	2 (87)
3.	Morepen Inc. 666, Plainsboro Road, Suite 215, Plainsboro, NJ 08536, United States of America (USA)	–	Subsidiary	100	2 (87)

i)		Category-wise Shareholding:
		Category of Shareholders		No. of Shares held at the beginning of the year st [As on 1	April, 2018]			March, 2019] No. of Shares held at the end of the year st [As on 31			% Change the year during
			De-mat	Physical	Total	Shares Total % of	De-mat	Physical	Total	Shares % of Total
	A.	Promoters
	(1)	Indian
		Individual/ HUF a)	4,12,41,750	–	4,12,41,750	9.17	4,12,41,750	–	4,12,41,750	9.17	–
		Central Govt. b)	–	–	–	–	–	–	–	–	–
		State Govt.(s) c)	–	–	–	–	–	–	–	–	–
		Bodies Corp. d)	11,41,29,838	–	11,41,29,838	25.37	11,41,29,838	–	11,41,29,838	25.37	–
		Banks / FIs e)	–	–	–	–	–	–	–	–	–
	f)	Any other	–	–	–	–	–	–	–	–	–
		Sub-total (A)(1)	15,53,71,588	–	15,53,71,588	34.54	15,53,71,588	–	15,53,71,588	34.54	–
	(2)	Foreign
		NRI's - Individuals a)	–	–	–	–	–	–	–	–	–
		Others - Individuals b)	–	–	–	–	–	–	–	–	–
		Bodies Corp. c)	–	–	–	–	–	–	–	–	–
		Banks/FIs d)	–	–	–	–	–	–	–	–	–
		Any Other e)	–	–	–	–	–	–	–	–	–
		Sub-total (A)(2)	–	–	–	–	–	–	–	–	–
		Total shareholding of Promoters
		(A) = (A)(1) + (A)(2)	15,53,71,588	–	15,53,71,588	34.54	15,53,71,588	–	15,53,71,588	34.54	–
	B.	Public Shareholding
	(1)	Institutions
		Mutual Funds a)	–	–	–	–	–	–	–	–	–
		Banks / FIs b)	15,73,293	6,87,500	22,60,793	0.50	16,32,945	3,12,500	19,45,445	0.43	(0.07)
		Central Govt. c)	–	–	–	–	–	–	–	–	–
		State Govt.(s) d)	–	–	–	–	–	–	–	–	–
		Venture Capital Funds e)	–	–	–	–	–	–	–	–	–

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

17 18

f)	Insurance Companies	2,15,79,754	85,125	2,16,64,879	4.82	2,15,79,754	85,125	2,16,64,879	4.82	–
g)	FIIs	–	3,85,30,000	3,85,30,000	8.57	–	3,85,30,000	3,85,30,000	8.57	–
h)	Foreign Venture Capital
	Funds	–	–	–	–	–	–	–	–	–
i)	Others (FPIs)	19,65,743	–	19,65,743	0.44	35,27,700	–	35,27,700	0.78	0.34
Sub-total (B)(1)		2,51,18,790	3,93,02,625	6,44,21,415	14.33	2,67,40,399	3,89,27,625	6,56,68,024	14.60	0.27
(2)	Non-Institutions
a)	Bodies Corp.	2,31,96,180	7,37,837	2,39,34,017	5.33	1,77,48,870	6,37,221	1,83,86,091	4.09	(1.24)
b)	Individuals
	Individual shareholders i)
	holding nominal share capital upto `1 Lakh	11,32,11,049	3,58,81,879	14,90,92,928	33.14	12,07,46,370	3,04,43,571	15,11,89,941	33.61	0.47
	Individual shareholders holding nominal share ii)
	capital in excess of
	`1 Lakh	2,82,34,069	1,65,637	2,83,99,706	6.31	3,04,74,341	4,74,382	3,09,48,723	6.88	0.57
c)	Any Other
	Non-Resident Indian/ i)	2,60,59,667	–	2,60,59,667	5.79	2,65,33,998	–	2,65,33,998	5.90	0.11
	OCB
	Clearing Member ii)	24,05,114	–	24,05,114	0.53	15,41,429	–	15,41,429	0.34	(0.19)
	Trust iii)	16,068	–	16,068	–	16,068	–	16,068	0.00	–
	NBFC iv)	1,25,700	–	1,25,700	0.03	1,70,341	–	1,70,341	0.04	0.01
	Sub-total (B)(2)	19,32,47,847	3,67,85,353	23,00,33,200	51.13	19,72,31,417	3,15,55,174	22,87,86,591	50.86	(0.27)
	Total Public Shareholding
	(B)=(B)(1)+(B)(2)	21,83,66,637	7,60,87,978	29,44,54,615	65.46	22,39,71,816	7,04,82,799	29,44,54,615	65.46	–
C.	Shares held by Custodian for
	GDRs & ADRs	–	–	–	–	–	–	–	–	–
	Grand Total (A+B+C)	37,37,38,225	7,60,87,978	44,98,26,203	100.00	37,93,43,404	7,04,82,799	44,98,26,203	100.00	–

ii) Shareholding of Promoters:

S.	Shareholder's Name		At the beginning of the year			At the end of the year		% change
No.		No. of Shares	% of total Shares of the Company	% of Shares Pledged/ encumbered to total shares	No. of Shares	% of total Shares of the Company	% of Shares Pledged/ encumbered to total shares	in share holding during the year
	1. Baby Aakriti Suri	55,000	0.01	–	55,000	0.01	–	–
	2. Gulfy Suri	11,50,000	0.26	–	11,50,000	0.26	–	–
	3. Rajas Suri	1,55,000	0.03	–	1,55,000	0.03	–	–
	4. Anju Suri	51,86,369	1.15	–	51,86,369	1.15	–	–
	5. P.L. Suri	4,00,000	0.09	–	4,00,000	0.09	–	–
	6. Sara Suri	7,05,000	0.16	–	7,05,000	0.16	–	–
	7. Master Arjun Suri	6,97,060	0.15	–	6,97,060	0.15	–	–
	8. Kanta Suri	1,510	0.00	–	1,510	0.00	–	–
	9. Sushil Suri & Sons (HUF)	12,01,560	0.27	–	12,01,560	0.27	–	–
	10. Praduman Lal Suri (HUF)	2,990	0.00	–	2,990	0.00	–	–
	11. Aanandi Suri	7,50,000	0.17	–	7,50,000	0.17	–	–
	12. Arun Suri & Sons (HUF)	15,00,000	0.33	–	15,00,000	0.33	–	–
	13. Arun Suri	3,510	0.00	–	3,510	0.00	–	–
	14. Sanjay Suri	34,17,240	0.76	–	34,17,240	0.76	–	–
	15. Varun Suri	30,52,357	0.68	–	30,52,357	0.68	–	–
	16. Anubhav Suri	7,82,134	0.17	–	7,82,134	0.17	–	–
	17. Aanchal Suri	6,85,922	0.15	–	6,85,922	0.15	–	–
	18. Baby Kanak Suri	9,97,060	0.22	–	9,97,060	0.22	–	–
	19. Sushil Suri 20. K B Suri & Sons (HUF)	55,01,510 9,72,830	1.22 0.22	– –	55,01,510 9,72,830	1.22 0.22	– –	– –
	21. Shalu Suri	20,52,250	0.46	–	20,52,250	0.46	–	–
	22. Sonia Suri	36,79,718	0.82	–	36,79,718	0.82	–	–
	23. Mamta Suri	30,04,000	0.67	–	30,04,000	0.67	–	–
	24. Sunita Suri	31,88,730	0.71	–	31,88,730	0.71	–	–
	25. Sanjay Suri Sons (HUF)	21,00,000	0.47	–	21,00,000	0.47	–	–
	26. React Investments & Financial Services Private Limited	1,14,42,134	2.54	–	1,14,42,134	2.54	–	–
	27. Liquid Holdings Private Limited	3,000	0.00	–	3,000	0.00	–	–
	28. Epitome Holding Private Limited	1,10,00,820	2.45	–	1,10,00,820	2.45	–	–
	29. Concept Credits & Consultants Private Limited	1,18,47,724	2.63	–	1,18,47,724	2.63	–	–
	30. Square Investments & Financial Services Private Limited	1,06,02,075	2.36	–	1,06,02,075	2.36	–	–
	31. Solitary Investments & Financial Services Private Limited	1,16,14,045	2.58	–	1,16,14,045	2.58	–	–
	32. Solace Investments & Financial Services Private Limited	1,15,82,790	2.57	–	1,15,82,790	2.57	–	–
	33. Brook Investments & Financial Services Private Limited	1,16,59,252	2.59	–	1,16,59,252	2.59	–	–
	34. Scope Credits & Financial Services Private Limited	1,20,75,405	2.68	–	1,20,75,405	2.68	–	–
	35. Mid-Med Financial Services & Investments Private Limited	1,14,73,813	2.55	–	1,14,73,813	2.55	–	–
	36. Seed Securities & Services Private Limited	1,08,28,780	2.41	–	1,08,28,780	2.41	–	–
	TOTAL	15,53,71,588	34.54	NIL	15,53,71,588	34.54	NIL	NIL

iii) Change in Promoters' Shareholding (Please specify, if there is no change): No change since last year

S. No.	Promoters	Shareholding at the beginning of the year		Cumulative Share-holding during the year
		No. of shares	% of total	No. of shares	% of total
			shares of the		shares of the
			Company		Company
1.	At the beginning of the year	15,53,71,588	34.54	15,53,71,588	34.54
	Increase/(Decrease) in Promoter's Shareholding during the year	–	–	–	–
	At the end of the year	15,53,71,588	34.54	15,53,71,588	34.54

iv) Shareholding Pattern of Top Ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

S. No.	Top Ten Shareholders	Shareholding at the beginning of the year			Cumulative Share-holding during the year
		No. of shares	% of total shares of the Company	No. of shares	% of total shares of the Company
1.	PINFOLD OVERSEAS LIMITED At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	3,85,30,000 –	8.57 –	– 3,85,30,000	– 8.57
2.	FERRY HOLDINGS LIMITED At the beginning of the year Increase/(Decrease) in Shareholding during the year 16/03/2018 At the end of the year	– 2,00,00,000	– 4.45	2,00,00,000 2,00,00,000	4.45 4.45
3.	LIFE INSURANCE CORPORATION OF INDIA At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	76,11,574 –	1.69 –	– 76,11,574	– 1.69
4.	DAMODAR PRASAD AGARWAL At the beginning of the year Increase/(Decrease) in Shareholding during the year 27/04/2018 04/05/2018 11/05/2018 18/05/2018 25/05/2018 08/06/2018 15/06/2018 06/07/2018 13/07/2018 20/07/2018	69,42,209 20,000 (10,000) (10,000) 20,000 (30,000) (27,000) (25,000) 10,000 (2,000) (20,000)	1.54 0.00 0.00 0.00 0.00 (0.01) (0.01) (0.01) 0.00 0.00 0.00	6,962,209 6,952,209 6,942,209 6,962,209 6,932,209 6,905,209 6,880,209 6,890,209 6,888,209 6,868,209	1.55 1.55 1.54 1.55 1.54 1.54 1.53 1.53 1.53 1.53
	27/07/2018 24/08/2018 31/08/2018 14/09/2018 05/10/2018 12/10/2018	(5,000) (754) 10,000 10,000 12,378 10,000	0.00 0.00 0.00 0.00 0.00 0.00	6,863,209 6,862,455 6,872,455 6,882,455 6,894,833 6,904,833	1.53 1.53 1.53 1.53 1.53 1.54

	19/10/2018	(4,000)	0.00	6,900,833	1.53
	28/12/2018	20,000	0.00	6,920,833	1.54
	18/01/2019	46,874	0.01	6,967,707	1.55
	15/02/2019	2,550	0.00	6,970,257	1.55
	22/02/2019	5,000	0.00	6,975,257	1.55
	15/03/2019	50,000	0.01	7,025,257	1.56
	22/03/2019	50,000	0.01	7,075,257	1.57
	At the end of the year			70,75,257	1.57
5.	UNITED INDIA INSURANCE COMPANY LIMITED
	At the beginning of the year	41,56,275	0.92
	Increase/(Decrease) in Shareholding during the year	–	–	–	–
	At the end of the year			41,56,275	0.92
6.	GENERAL INSURANCE CORPORATION OF INDIA
	At the beginning of the year	35,66,869	0.79
	Increase/(Decrease) in Shareholding during the year	–	–	–	–
	At the end of the year			35,66,869	0.79
7.	THE NEW INDIA ASSURANCE COMPANY LIMITED
	At the beginning of the year	30,41,425	0.68
	Increase/(Decrease) in Shareholding during the year	–	–	–	–
	At the end of the year			30,41,425	0.68
8.	BAYSWATER ENTERPRISES LIMITED
	At the beginning of the year	29,04,000	0.65
	Increase/(Decrease) in Shareholding during the year	–	–	–	–
	At the end of the year			29,04,000	0.65
9.	NATIONAL INSURANCE COMPANY LIMITED
	At the beginning of the year	19,29,500	0.43
	Increase/(Decrease) in Shareholding during the year	–	–	–	–
	At the end of the year			19,29,500	0.43
	10. EMERGING MARKETS CORE EQUITY PORTFOLIO
	(DFA Investment Dimensions Group Inc.)
	At the beginning of the year Increase/(Decrease) in Shareholding during the year:	81,100	0.02
	27/04/2018	100,622	0.02	181,722	0.04
	04/05/2018	65,081	0.01	246,803	0.05
	11/05/2018	89,982	0.02	336,785	0.07
	18/05/2018	246,178	0.05	582,963	0.13
	25/05/2018	154,318	0.03	737,281	0.16
	15/06/2018	141,742	0.03	879,023	0.20
	22/06/2018	38,281	0.01	917,304	0.20
	06/07/2018	40,099	0.01	957,403	0.21
	13/07/2018	205,984	0.05	1,163,387	0.26
	20/07/2018	309,698	0.07	1,473,085	0.33
	27/07/2018	190,926	0.04	1,664,011	0.37
	03/08/2018	25,220	0.01	1,689,231	0.38
	10/08/2018	69,861	0.02	1,759,092	0.39
	17/08/2018	137,736	0.03	1,896,828	0.42
	At the end of the year			18,96,828	0.42

v) Shareholding of Directors and Key Managerial Personnel:

S. No.	Director(s) & KMP(s)	Shareholding at the	beginning of the year	Cumulative Shareholding during the year
		No. of shares	% of total shares of the Company	No. of shares	% of total shares of the Company
1.	MR. SUSHIL SURI Chairman & Managing Director At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	55,01,510 –	1.22 –	– 55,01,510	– 1.22
2.	DR. A. K. SINHA Whole-time Director At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	100 –	0.00 –	– 100	– 0.00
3.	MR. MANOJ JOSHI Independent Director At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	– –	– –	– –	– –
4.	MR. SUKHCHARAN SINGH Independent Director At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	– –	– –	– –	– –
5.	MR. B. R. WADHWA Independent Director At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	– –	– –	– –	– –
6.	MRS. ANJU SURI Director At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	51,86,369 –	1.15 –	– 51,86,369	– 1.15
7.	MR. AJAY SHARMA Chief Financial Officer At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	– –	– –	– –	– –
8.	MR. THOMAS P. JOSHUA* Company Secretary At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	– –	– –	– –	– –
9.	MR. VIPUL KUMAR SRIVASTAVA** Company Secretary At the beginning of the year Increase/(Decrease) in Shareholding during the year At the end of the year	– –	– –	– –	– –

th * Mr. Thomas P. Joshua had resigned on 24 September, 2018.

th ** Mr. Vipul Kumar Srivastava is appointed as the Company Secretary w.e.f., 12 November, 2018.

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/accrued but not due for payment:

				(` in Lakhs)
Particulars	Secured Loans (excluding deposits)	Unsecured Loans	Deposits	Total Indebtedness
Indebtedness at the beginning of the financial year
(i) Principal Amount	1,411.67	11,965.20	–	13,376.87
(ii) Interest due but not paid	65.12	831.69	–	896.81
(iii) Interest accrued but not due	–	–	–	–
Total (i+ii+iii)	1,476.79	12,796.89	–	14,273.68
Change in Indebtedness during the financial year
*Addition	1,004.37	49.63	–	1,004.37
*Reduction	1,311.80	–	–	1,311.8
Net Change	(307.43)	49.63	–	(307.43)
Indebtedness at the end of the financial year
(i) Principal Amount	1,169.36	1,1965.2	–	13,134.56
(ii) Interest due but not paid	–	881.32	–	881.32
(iii) Interest accrued but not due	–	–	–	–
Total (i+ii+iii)	1,169.36	12,846.52	–	14,015.88

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Whole-time Directors and/or Manager:

(` in Lakhs)

S.	Particulars of Remuneration	Name of MD/WTD/Manager		Total Amount
No.		Mr. Sushil Suri	Dr. A. K. Sinha
		Chairman &	Whole-time
		Managing Director	Director
1.	Gross salary
	a. Salary as per provisions contained in
	Section 17(1) of the Income-tax Act, 1961	109.33	6.00	115.33
	b. Value of perquisites under Section 17(2)
	Income Tax Act, 1961	11.86	–	11.86
	c. Profits in lieu of salary under Section 17(3)
	Income Tax Act, 1961	–	–	–
2.	Stock Option	–	–	–
3.	Sweat Equity	–	–	–
4.	Commission
	- as % of profit	–	–	–
	- others, specify	–	–	–
5.	Others, please specify	–	–	–
	Total (A)	121.19	6.00	127.19
	Ceiling as per the Act	149.43	149.43	298.86

B. Remuneration to other Directors:

					(` in Lakhs)
S. No.	Particulars of Remuneration		Name of Directors		Total Amount
1.	Independent Directors	Mr. Manoj Joshi	Mr. Sukhcharan Singh	Mr. B. R. Wadhwa
	• Fee for attending board and
	committee meetings	2.05	1.90	1.70	5.65
	• Commission	–	–	–	–
	• Others, please specify	–	–	–	–
	Total (1)	2.05	1.90	1.70	5.65
2.	Other Non-Executive Directors	Mrs. Anju Suri*
	• Fee for attending board and
	committee meetings	–	–	–	–
	• Commission	–	–	–	–
	• Others, please specify	–	–	–	–
	Total (2)	–	–	–	–
	Total (B)=(1+2)	–	–	–	5.65
	Total Managerial Remuneration (A+B)				132.84
	Overall Ceiling as per the Act				378.75

*Mrs. Anju Suri being a Non-Executive Non-Independent Director of the Company, has not been paid any remuneration.

C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD: (` in Lakhs)

	$\bar{\bar{\mathfrak{c}}}$ in Lakhs)

S.	Particulars of Remuneration		Key Managerial Personnel		Total Amount
No.		Mr. Ajay Sharma (Chief Financial Officer) (Company Secretary) (Company Secretary)*	Mr. Thomas P. Joshua	Mr. Vipul Kumar Srivastava
1.	Gross salary Salary as per provisions contained in Section 17(1) of the Income-tax Act, 1961	85.65	7.50	4.83	97.98
	Value of perquisites under Section 17(2) Income Tax Act, 1961 Profits in lieu of salary under	–	–	–	–
	Section 17(3) Income Tax Act, 1961	–	–	–	–
2.	Stock Option	–	–	–	–
3. 4.	Sweat Equity Commission - as % of profit	–	–	–	–
	- others, specify	–	–	–	–
5.	Others, please specify	–	–	–	–
	Total	85.65	7.50	4.83	97.98

th * Mr. Thomas P. Joshua had resigned on 24 September, 2018.

th ** Mr. Vipul Kumar Srivastava is appointed as the Company secretary w.e.f., 12 November, 2018.

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES

st There were no penalties/punishment/compounding of offences for the year ended 31 March, 2019.

For and on behalf of Board of Directors

ANNEXURE 'F'

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

[Information under Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 and forming st part of Directors' Report for the year ended 31 March, 2019]

boiler is under evaluation. 1) Energy Conservation measures taken:

• Replacement of PPFRP blades with Aluminum B. TECHNOLOGY ABSORPTION (R&D) Blades in the Cooling Tower.

• Installation of Pneumatic Control Valves with well as to meet the stringent requirements of various

• Replacement of Chilled water with the cooling affordable cost, development of cost-effective
• Recovery of entire plant condensate various APIs are as under:

• Installation of High efficiency agitator in diabetic category.

• Reduction in power consumption by 4%/kg & commercialization of Linagliptin in of productivity. Anti-diabetic category to plant.

• in plant. around 4%.

• Feasibility study already being carried out for diabetic category to plant. planning to replace all our street lights with Solar in collaboration with NIPER Mohali. installation, we will plan for 600 MW solar in different therapeutic categories

• A. CONSERVATION OF ENERGY Replacement of Furnace Oil with LPG in the
• Replacement of Belt Drive Centrifugal Blowers 4) Capital investment on energy conservation equipment: with Plug type directs Blowers in the Air Capital investment on energy conservation Handling Units. equipment made during the year is `243.00 Lakhs.

1) Efforts made towards technology absorption: • Replacement of plant motors with high efficient The Company is carrying out innovative process motors. improvements for the manufacture of its entire APIs • Providing high efficiency Hot water system in as well as Formulations. Research and Development the manufacturing facilities which replaces (R&D) activities continue to be a strong support for existing hot water system (direct steam purging). profitable growth of business of the Company as the manual Steam Valve in the Hot water tanks regulated markets. Efforts & resources put in R&D and Steam Tray Dryers which reduced the steam have yielded the desired results in developing robust consumption. and safe processes as well as formulations at tower water in the Solvent Recovery Plant after processes for synthesis of new APIs and improving installation of high efficiency heat exchangers. processes for existing APIs and formulation • Technology up gradation in the Utilities sections products. The key areas and efforts made towards by installing the high efficiency machines. development/improvements of technologies of

• by installation of pressure power pump Scale up of Technology at Manufacturing plant & package unit. Commercialization of Empagliflozin in anti-
• Transfer of Technology of Amorphous the reactors. Dapagliflozin in Anti-diabetic category to plant.
• 2) Impact of measures taken: Scale up of Technology at Manufacturing plant
• Reduction in fuel consumption by 4%. Development of cost-effective enzymatic • Reduction in our overall energy bill, power & process using Green chemistry & transfer of Technology of Ursodeoxycholic Acid in fuel by around 4%/kg of productivity. Treatment of primary biliary Cirrhosis category • Reduction in solvent consumption by

• Transfer of Technology of Alogliptin Benzoate in Reduction in time cycle by around 14%. Anti-diabetic category to plant. 3) Steps taken for utilizing alternate source of energy: Transfer of Technology of Vildagliptin in Anti-

• utilizing solar energy, as an alternate source of Development of Improved Chemical Entities/ power, at plant locations. To Start with we are Novel chemical Entities (NCE) is being explored

st energy in the I Phase and after this successful New Formulations Developed and commercialized

Roof Tops. • Montelukast & desloratadine tablets and

Montelukast & Fexofenadine tablets Development under progress: Montelukast+Levocetrizine dispersible tablets • Vildagliptin 50/100 mg tablets- under developen and commercialized under antidiabetic segment.

• Bromohexine syrup & Ambroxol HCL + cardiovascular disorder category. +Phenylephrine syrup and Ambroxol + under cardiac segment. under Cough and cold category. anticonvulsant category.

• Deflazacort tablets under immunomodulators. tablets- Under Cardiac segment.

• Acebrophylline ER tablets under bronchiodilator Esomeprazole 20/40 mg tablets under
• category. Antigastric/ antiacid category. Citicholine+ piracetam tablets under
• tablets category. Racecadotril capsules under antidiarrhoeal
• Promethazine syrup under aniti nausea & Pain and Antispasmodic category.
• Tamsulocin and dutasteride bilayer tablet for pain & skeletal muscle relaxant.
• Febuxostat 80 mg additional strength under under cardiac segment.
• Aluminium hydroxide, Magnesium hydroxide, under cardiac segment. under Gastric disorder. under cardiac segment.

Products developed to be launched under different

• Aceclofenac & Thiocolchicoside tablets under Development (R&D) activities:

• Atorvastatin tablets additional strengths under which would help it in reducing cost and offer

• US2019/0127334 & EP3445751. Iron with Multivitamin tablets Under vitamin &

• antihistaminic & antiallergic category. Vildagliptin 50+ Metformin/500/850/1000 mg Iron, multivitamin & mutivitamin tablets. tablets- Under antidiabetic segment. Disodium hydrate syrup under antacid and

• Rivaroxaban tablets 15/20 mg tablets- under gastric disorder.
• Terbutaline Sulphate + Guiaphensin Dabigatron Mesilate capsules 75/110/150 mg
• Levosalbutamol sulphate + Guaiphensin syrup Levetiracetam 250/500 tablets-under
• Terbinafine tablets, Ketoconazole tablets Montelukast+Desloratadine Syrup (First time in developed & launched under anti-fungal category. INDIA, Patent has filed in India). Paracetamol suspension under pediatric
• Aspirin 75+Clopidogrel 75/150 mg Bilayered antipyretic category.

• Doxycycline capsule under broad spectrum Telmisartan 80 mg +Amlodipine 5 mg bilayered antibiotic category. tablets-under antihypertensive segment.

• Coral calcium tablets- under Calcium neurological disorder/Alzheimer's.

• category. Mefenamic acid +Dicyclomine tablets under
• vomiting. Etoricoxib+ Thiocholchicoside tablets under
• benign prostatic hyperplasia. calcitriol, Vit K2-7, Caco3 Boron, Zinc tablets- Alphalipoic acid and mecobalamin along with Under vitamin, mineral tablets. vitamin-B group capsules under Antioxidant &
• Atorvastatin 10 mg + Aspirin 75 mg capsules- vitamins category.
• Antigout category. Rosuvastatin 10 mg + Aspirin 75 mg capsules-
• simethicone, Oxetacaine Antacid suspension Dapagliflozin propanediol 5/10 mg tablets-
• therapeutic categories: 2) Benefits derived as a result of Research and

Pain & Skeletal muscle relaxant category. The Company is working to improve its processes antihyperlipedemic category. quality products both in API and formulation • Pantoprazole tablets - additional strengths under segments. Benefits derived as a result of the above Gastric & antiacidity. including product improvement, cost reduction, • Paracetamol+ Caffeine tablets under Pain new product development, import substitution etc.

• management (Head ache category). are detailed hereunder: Vitamin D3 Oral solution (Oil based) under PCT National phase application of Rosuvastatin Vitamin D defficiency (rickets/osteomalacia). Calcium of new polymorph patent was filed in Metformin ER 750 mg Tablets additional Europe & USA. It has been published as strengths under antidiabetic category.
• Mineral tablets. Indian Patent application titled "Novel Amine • Sugar free tablets - under supplements for Salts and Amide Derivatives of Various Active diabetic patient. Pharmaceutical Ingredients" was filed as IN201811021553.

• Indian Patent application for Empagliflozin was Ertugliflozin in Anti-diabetic category,
• Indian Patent application titled "Novel Processes histaminic category & Vortioxetine for the purification of UDCA and its various Hydrobromide in Anti-depressant category are intermediates" was filed as IN201911008295. being considered for development.
• Rivaroxaban and its Intermediates" was filed as demand.
• Pharmaceutical Composition in Form of Rupatadine Fumarate is being planned. Montelukast Sodium" was filed. It essentially Green chemistry is also planned. sodium & Desloratadine in varying composition. using Microwave Technology.
• Yield improvement and reduction in the input To focus on in-house API formulations for quantities of Raw Materials resulting in cost domestic and export markets.
• Process/Quality improvements and product up- mg, Linagliptin 5 mg, Empagliflozin 10/25 mg,
• Robust formulation with improved Quality of at initial stage. complaints at Zero level. Baddi location.
• Cost reduction in different formulations by 4) Imported Technology (imported during last 3 years quality parameters such as: Telmisartan None. tablets20/40/80mg, Enalapril maleate tablets
• Patent filing (Provisional specification) entitled A Development (R&D) Pharmaceutical Composition in Form of The Company has incurred a total expenditure of

The Company continues to carry on various R&D and Development. initiatives and is regularly upgrading its capabilities C. FOREIGN EXCHANGE EARNINGS AND OUTGO to stay ahead of the demanding market

Edoxaban Tosylate in Anti-coagulant Category, note no. 31. Elagolix Sodium in GnRH Antagonist Category,

filed as IN201911008294. It reports "Novel Febuxostat in Anti-gout Category, Ivacaftor in Processes for preparation of Crystalline Transmembrane conductance regulator Empagliflozin". category, Rupatadine Fumarate in Anti-

• Indian Patent application titled "Novel Processes Commercialization of Ursodeoxycholic acid & for the preparation and purification of Vildagliptin is being planned due to their high
• IN201911013250. Technology Transfer / Scale up & • Indian Patent application titled "А commercialization of Rivaroxaban &
• Aqueous Syrup Comprising Desloratadine and Process Improvement work using concept of
• covers the formulation containing Montelukast Process Improvement work for various APIs
• reduction and economization for various APIs. To develop and File dossier for Apixaban 2.5/5 gradation as per customer requirements. Sitagliptin 25/50/100 mg through CRO & CMO
• pharmaceutical products via mandatory stability Simultaneous Creation of our own Formulation studies of drug product at Formulation development lab & Analytical development lab Development stage to minimize market facility for ANDA and other regulated market at
• altering the excipient without affecting the reckoned from beginning of the financial year)

2.5/5.0& 10 mg, Etoricoxib tablets 90 mg. 5) Expenditure incurred on Research and

Aqueous Syrup Comprising Desloratadine and 95.86 Lakhs, in comparison to expenditure of Montelukast Sodium".50.20 Lakhs in the previous year (including 3) Future plan of action: capital and revenue expenses), towards Research

The information on earnings and outgo of foreign requirements. The R&D work is focused on: • New drugs like Rivaroxaban, Apixaban & exchange is given in notes to Financial Statements under

For and on behalf of Board of Directors

Sushil Suri Place: New Delhi (Chairman & Managing Director) th Date: 27 July, 2019 DIN: 00012028

ANNEXURE 'G'

MANAGEMENT DISCUSSION AND ANALYSIS

between China and the United States. are several challenges that may affect the industry's future growth in 2019 and beyond. The drug prices are at an all- The pharmaceutical landscape is constantly changing with time high, R&D productivity has only just begun to climb the rapid growth of biosimilars and disruptions of health again following a limitation faced in previous few years. The technology. The global pharmaceutical market is expected Indian Pharmaceutical Sectors is recovering from regulatory to grow at compound annual growth rate of around 3-6% turbulence in the most profitable global market, top Indian over the next five years and will cross \$1.5 trillion by 2023. pharma companies have zeroed in on cost rationalization, The key drivers of growth will continue to be the United better compliance standards and a more nimble response to States and pharmerging markets with 4-7% and 5-8% competition while hoping the Chinese market could provide compound annual growth, respectively. In the United States, the salve going ahead. A review of the FY19 performance of overall spending growth is driven by a range of factors leading Indian pharma companies point to four dominant including new product approval and brand pricing, while it themes that hold the future for the industry. is offset by patent expiries and generics. Medicine spending

medicines is expected to decline by -3 to 0% through 2023, be the most important mantra for Indian pharma companies largely because of exchange rates and the continued uptake that compete on low-cost generics. Spending high on R&D of generics. In Europe, cost-containment measures and less related to generic drugs has not been paying off — prompting growth from new products contribute to slower growth of companies to go back to their planning boards to make R&D 1−4%, compared to the 4.7% compound annual growth more productive. Besides, legal costs as well as expenditure seen over the past five years. Pharmaceutical spending in on drug marketing have surged in recent years.

Compliance: With most pharma companies facing \$140−170 billion by 2023, but its growth is likely to slow to compliance issues with the US drug regulator, the topic is 3−6%. bound to be on top of their list of priorities. Right from New products and losses of exclusivity will continue to drive observations, warning letters to import alerts – companies in similar dynamics across developed markets, while product India have faced varying degrees of reproach from the mix will continue to shift to specialty and orphan products. USFDA. Besides the loss of business and expenses incurred An average of 54 new active substance (NAS) launches per on remedial action, companies also suffer value erosion on

Competition: Competition in the US has worsened in the spending to near 50% by 2023 in most developed markets. traditional generic business segment and is no longer as At the same time, the impact of losses of exclusivity in remunerative. Faster pace of drug approvals has accentuated developed markets is expected to be \$121 billion between it. To counter it, Indian companies are moving towards 2019 and 2023, with 80% of this impact, or \$95 billion, in difficult to manufacture differentiated drugs like complex the United States. By 2023, biosimilars competition in the generics, specialty drugs and biosimilar – a shift that requires biologics market will be nearly three-times larger than it is change in expertise, additional investment and management today. The industry need to address many challenges, in bandwidth. The growth prospects of companies will depend order to thrive in 2019 and beyond. on the selection of the right strategy.

China: The gradual opening of the Chinese market for Indian market for many years, so slowed growth here signals bad generics seems to be a timely opportunity for pharma

GLOBAL PHARMACEUTICAL SCENARIO companies. Indian companies are trying to find a sweet spot to export drugs to China amidst the fast-developing trade war The pharmaceutical industry continues to thrive, yet there

in Japan totaled \$86 billion in 2018, however spending on Cost: Rationalisation of cost during difficult times seems to China reached \$137 billion in 2018 and is expected to reach

year are expected over the next five years and two-thirds of the bourses amid uncertainty about the course correction. launches will be specialty products, lifting specialty share of

The United States has led the international pharmaceutical

news for the global economy. Analytical reports indicate that Although biosimilars will present competition for biologics, market growth in the US will slow to single digits, between they represent significant savings to the consumer. In the 6% and 9%, through 2021, which is down from a 12% United States, the projected cost savings from switching to growth in earlier years. Still, the US will remain the world's biosimilars is expected to be between \$40 and \$250 billion largest pharmaceutical market, contributing 53% of all within the next 10 years. This will go some way in forecasted growth within the next five years. China is combatting the drug price crisis and make life saving expected to continue in the second-largest spot by medicines more affordable.

On a volume basis, the total volume of medicines consumed an opportunity for pharmaceutical companies. Those who globally will increase by about 3% annually through 2021, excel at marketing biosimilars within their product range only modestly faster than population and demographic stand to gain an edge over their competitors. Even shifts. Issues of pricing, market-access pressures, lower companies with limited experience of developing volume growth in emerging markets, and further generic- biosimilars can grow their portfolios with strategic drug spread will contribute to the lower rate of growth, mergers/acquisitions to increase their capabilities.

There is still a major issue over high drug prices in the USA. terms of their departure from the European Union (EU), the Mounting pressures by patients, politicians and regulatory effect of the potential outcomes on the pharmaceutical bodies over drug pricing and reimbursement led to price industry, both in the UK and globally, is not fully known. The freezes in 2018 and a proposal to introduce an 'international fear of a no-deal Brexit is causing a sense of panic in the pricing index' through Medicare - which would aim to European industry that the UK is working hard to assuage. reduce Medicare spending by 30%. The proposal was met 2019 is proving to be an interesting year for the widely with criticism due to concerns and in early 2019 pharmaceutical industry for many reasons. Slowed market several pharmaceutical companies hiked their prices up growth, Brexit implications and inflated drug prices are main even further - an average of 6.3%. The government faces an areas of concern, but we have also seen this in prior years ongoing and complex challenge to control increasing drug where the market bounced back and adapted to change. prices to pave the way or more affordable and accessible Still, even with its challenges, the pharmaceutical industry is healthcare for its citizens.

Biosimilars have made big waves in recent years and there is horizon with biosimilars and patient-centric healthcare strong growth predicted across all markets, forecasting over trends that are likely to help the market return to a full 20% increases over the next five years. However, even thriving state. Emerging markets with strong market growth though biosimilars are growing at an accelerated rate, the such as China promise more innovative drug development, market is still dominated by small molecules with 76% of the hopefully leading to more life-saving drug approvals for market share. patients worldwide.

Although biosimilars are a growing segment and threaten to DOMESTIC PHARMACEUTICAL MARKET take market share from small molecules, there are some India enjoys an important position in the global

contributing 12% of the world's pharmaceutical growth. Because they are so new to market, biosimilars also present

according to the analysis. With the deadline fast approaching for the UK to confirm the

maintaining a stronghold. There is promising news on the

challenges to their production. Based on progress to date, pharmaceuticals sector. The country also has a large pool of the development of biosimilars seems to provide challenges scientists and engineers who have the potential to steer the of its own. Despite considerable growth, the market is still in industry ahead to an even higher level. Presently over 80 per early nascent stage and, in some markets, this development cent of the antiretroviral drugs used globally to combat AIDS is being further slowed by lawsuits over biologic patents. (Acquired Immune Deficiency Syndrome) are supplied by The regulatory processes are not yet solidified either and Indian pharmaceutical firms. The exports of Indian those that have been developed thus far have required costly pharmaceutical industry to the US will get a boost, as clinical trials to gain market approval. branded drugs worth US\$ 55 billion will become off-patent

during 2017-2019. Medicine spending in India is projected filed during the current year whereas USDMF filing for to grow 9-12% over the next five years, leading India to another commercialized product of this category i.e. become one of the top 10 countries in terms of Linagliptin, is also planned for the current year.

Vildagliptin were completed successfully in the plant. Two 2017. The country's pharmaceutical industry is expected to new products in the latest anti-diabetic 'gliflozin' series i.e. expand at a CAGR of 22.4% till 2020 to reach US\$ 55 Dapagliflozin Propanediol & Empagliflozin have been billion. India's pharmaceutical exports stood at US\$ 17.27 commercialized & their USDMF filing is also slated for the billion in FY18 and have surpassed US\$ 15.52 billion coming year. Furthermore, development of Amorphous in FY19.

India's domestic pharmaceutical market turnover reached transferred to plant. The commercialization of Canagliflozin US\$ 18.12 billion in 2018, growing 9.4% year-on-year US\$ Hemihydrate is being planned in the current year. Morepen 17.87 billion in 2017. During 2018, Indian pharma has also selected Ertugliflozin, another new drug of this companies received 290 ANDA approvals from US FDA. series, for development, which seems to have good market The country accounts for around 30% (by volume) and about potential. These valuable additions would make 'Morepen'

India's biotechnology industry comprising bio- hypercholesterolemic & Anti-diabetic drugs. The new pharmaceuticals, bio-services, bio-agriculture, bio-industry product additions in aforesaid new categories are expected and bioinformatics is expected grow at an average growth to bring additional business to the Company. rate of around 30% a year and reach US\$ 100 billion by Apart from this, development of another complex molecules

to 8.5% in FY18. has been transferred to plant.

The government has taken many steps to reduce costs and Morepen is world leader in Loratadine produced in its bring down healthcare expenses. Speedy introduction of USFDA approved Masulkhana as well as Baddi facility. The generic drugs into the market has remained in focus and is Company has achieved leadership position, of being one of expected to benefit the Indian pharmaceutical companies. In the largest suppliers of block buster drugs i.e. anti-asthmatic addition, the thrust on rural health programmes, lifesaving drug Montelukast Sodium produced in its USFDA approved drugs and preventive vaccines also augurs well for the Masulkhana along with Desloratadine, another antipharmaceutical companies. histaminic drug.

Anti-hypertensive, Anti-histaminic, Anti-asthmatic, Fexofenadine Hydrochloride of anti-histaminic series, Anti-hypercholesterolemia & Anti-diabetic drugs and has Olmesartan & Candesartan of anti-hypertensive series & their intermediates produced in its USFDA approved Baddi been servicing customers both in export as well as domestic markets from many years. The Candesartan Cilexetil and facility. Another block buster drugs Sitagliptin, Saxagliptin, Olmesartan Medoxomil Genotoxic DMF filing is slated Linagliptin of 'Gliptin' series and Empagliflozin, Dapagliflozin Propanediol of 'Gliflozin' series are also during the current calendar year. The USDMFs for already produced in the Baddi facility to cater the requirement of commercialized latest anti-diabetic drugs of 'gliptin' series various customers for formulation development & for patent i.e. Saxagliptin Hydrochloride & Sitagliptin phosphate were

medicine spending. Development & transfer of technology of another New molecules of this series i.e. Alogliptin Benzoate & The pharmaceutical sector was valued at US\$ 33 billion in Dapagliflozin has also been completed and has been 10% (value) in the US\$ 70-80 billion US generics market. very strong in Anti-histaminic, Anti-asthmatic, Anti-

1. 'Ursodiol' or Ursodeoxycholic acid, for treatment of primary Further investment (as % of sales) in research & development biliary cirrhosis, has been completed by enzymatic by Indian pharma companies* increased from 5.3% in FY12 technology as a green chemistry initiative and its technology

MOREPEN'S STRATEGY Morepen continues to be a prominent player in commercial ACTIVE PHARMACEUTICAL INGREDIENDTS (API) production of block buster drugs Atorvastatin calcium, Rosuvastatin calcium of Anti-hypercholesterolemic series, The company is having strong foothold in the fields of free countries.

Morepen wishes to make its hold further strong in anti- The Company is reaching more markets and servicing large histaminic category by developing Rupatadine Fumarate in spectrum of people to deliver its wide range of products. the coming year. OPPORTUNITIES AHEAD

Morepen has filed five new patent applications for This growth is fuelled by the growing and ageing population Crystalline Empagliflozin, Novel purification process of in key markets. As per World Population Prospects by UDCA, Novel purification and preparation process of United Nations, the worldwide population is likely to cross Rivaroxaban, Rupatadine Fumarate Polymorphic Form A & 9.3 billion by 2050 and around 21% of this population is for Pharmaceutical Composition in Form of Aqueous Syrup expected to be aged 60 and above. Apart from ageing and

growth of global pharma industry. Another aspect which is formulations and home diagnostics business segments. leading this growth is rising focus of pharmaceuticals Formulation business has recorded a growth of 39% during companies to tap the rare and speciality diseases market. the year whereas Home - diagnostics business is up by 35% Innovations in advanced biologics, nucleic acid against last year. Blood Gluco monitoring business is up therapeutics, cell therapies and bioelectronics & 43% whereas Blood Pressure monitoring business is up by implantable has attracted investments in the industry by 22%. The Company has cumulatively sold 285 Million even non-pharma companies which is also driving the global Gluco Strips as on close of current year.

Home Diagnostics business continues to make handsome On the other hand, adoption of cost control policies along growth year on year and has touched ` 139.75 Crores in the

having reposed confidence in our branded product portfolio sustain growth. will be offered new products during the coming years and However medicine spending in India is projected to grow market penetration shall also be improved.

BRAND SHARING AND PRODUCT CONTRACT of the top 10 countries in terms of medicine spending. MANUFACTURING (PCM)

depend on the ability of companies to align their product significant growth during the current year. Your Company portfolio towards chronic therapies for diseases such as such has been able to make inroads across most of the therapeutic as cardiovascular, anti-diabetes, anti-depressants and anti- areas based on its brand image and quality product delivery.

The tie-up with Vésale Pharma International of Belgium will Morepen is thinking out of box and targeting totally different be offering the entire product folio in immediate future and segment of drugs, with consideration of Elagolix Sodium in company expects to have some footprint in Probiotics GnRH Antagonist Category, Ivacaftor in Transmembrane market in India.

Comprising Desloratadine and Montelukast Sodium. rising population the improvements in purchasing power and access to quality healthcare and pharmaceuticals to FORMULATIONS AND HOME HEALTH DIAGNOSTICS poor and middle-class families worldwide also is driving the Your Company has made considerable progress in both pharmaceuticals industry growth.

with tightening of rules by governments in key markets are current year from ` 51.30 Crores in FY2015. The expected to impact the growth prospect of the global manufacturing of Blood Glucometers started few years back pharmaceuticals industry. Pharmaceuticals companies are has made the company self-reliant. It had saved foreign forced to reduce their research and development (R&D) exchange worth USD 3 million during the current year. spending due to slowdown of growth in last few years which Further in house production of Glucometer strips was started is also expected to hamper growth of the global pharma last year is bearing fruits. The Company taken up in house market as new drugs revenue form large part of pharma manufacturing Nebulizers and Thermometers. firm's revenue due to exclusivity of the drug. Apart from The formulation and home diagnostics business has these generics pharma market is facing decreasing return on significantly improved during the year and efforts are on to investment due to price erosion in key markets which is make significant growth in the coming years. The customers forcing many firms to look for other avenues and markets to

9-12% over the next five years, leading India to become one

Going forward, better growth in domestic sales would also Brand sharing and contract manufacturing business has been cancers that are on the rise.

category & Vortioxetine Hydrobromide in anti-depressant hype into more tangible use cases. category. Two more drugs in Anti-depressant category The predictive and analytic powers of AI enable companies namely Suvorexant & Brexpiprazole, are considered for to make smarter, faster, and more strategic decisions. AI will R&D development. Three more drugs, Vonoprazan increase drug development efficiency by not wasting Fumarate in Anti-ulcer category, Tofogliflozin in Anti- research efforts, for example creating alternative hypotheses diabetic Category & Topiroxostat in Anti-Gout category may for trials by discovering more data to enable drug

In 2019, drug pricing pressure from regulators, patients, the short term, it will have a real impact with its ability to politicians and payers will remain and aggressive collect and aggregate disparate data sets and identify negotiation tactics to drive down drug prices are expected. patterns which in turn will generate more insights. The real The drug pricing and reimbursement constraints will have potential of AI and machine learning is in enabling pharma the greatest negative impact on the pharmaceutical sector in companies to be smarter, faster, and more cost efficient. the years to come. The rise of China, vertical integration and FIXED ASSETS patent expiry of biologics are expected to have an adverse Fixed Assets of the Company are generally well maintained equal impact. and are in good condition.

The cost containment measures such as price and INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY reimbursement cuts are leading to tougher market Your Company's internal systems are adequate and conditions for drug manufacturers and shrinking profit commensurate with the size of operations. These controls margins. In response to these pressures, companies are ensure that transactions are authorized, recorded and reassessing their strategies and market focus. As a result, reported on time. They ensure that assets are safe guarded companies will need to adopt more flexible pricing and protected against loss or unauthorized disposal. strategies to maximise return on investment including

Despite concerns about a trade war, it is not a surprise that were carried out to ensure that audit recommendations were China is still viewed as a huge market opportunity for the implemented. Discrepancies and weaknesses, if any, found pharmaceutical industry. China has a large population with a at various levels are timely and suitably addressed with a growing middle class and it has become a leader in R&D view to efficiently manage the company's valuable innovation for medicine, particularly regenerative medicine resources. and perhaps even gene editing. The big challenge that HUMAN RESOURCES companies will face is how to best navigate the Chinese HUMAN RESOURCE MANAGEMENT regulatory and commercial landscape.

conductance regulator category, Febuxostat in Anti-gout same time, Artificial Intelligence (AI) is maturing - turning the

also be considered as future pipeline. repurposing. AI will be critical to the future of pharma as the OUTLOOK ON THREATS, RISKS AND CONCERNS amount of available data and monitoring devices increase. In

The Internal Audit department carried out audits in different negotiate earlier with payers. areas of your Company's operations. Post-audit reviews

Your Company strongly believes that its human resource The patent expiry of biologics will have a major impact in function is of strategic significance and works towards 2019, and it is anticipated that the immediate impact will be building a strong employee value proposition for its less than expected, particularly in the US. Although several employees. It provides channels for exceptional career biosimilars are now approved in the US, the pace of their growth, superior leadership development, modern day HR subsequent launch and market growth remains slow and practices, transparent communication, opportunities for most biosimilars still face stiff legal battles. continual learning, enhanced well-being and safety and Since the pharmaceutical industry needs to increase engagement. Its traditions of fair play, equal opportunity efficiency, particularly when it comes to drug development. and value chain enhancement are alive and progressing. The pharma companies losing margins and lacking the Our professionals receive competitive salaries and benefits. required capital to continue to run trials or testing. At the The inter-personal relationship amongst workers, staff and

officers has always been pleasant and of peaceful co- During the year, the Return on Net Worth of the Company is st existence. As on 31 March, 2019, there were 1,376 10.31% as compared to the previous financial year 10.42%. permanent employees on the rolls of the Company. CAUTIONARY STATEMENT

Health, safety and well-being of employees is of paramount The market data and other information contained herein importance at Morepen and initiatives including medical have been based on the statistics gathered from various plan benefits, health coaching and awareness have been published and unpublished sources and the Company does implemented during the year. Employee training and not take any assurance about their authenticity. The development forms a crucial part of human resource Company's Management reserves the right to revisit any of development agenda at Morepen and various interventions the analytical statements to decide the best course of action including trainings on plant safety and POSH have been for the maximization of Shareholders' value in addition to undertaken. meeting social and corporate obligations.

express their appreciation for the hard work and Discussions and Analysis Report pertaining to Company's commitment of the employees of the Company and look objectives, strategies, estimates, expectations or predictions,

results may be affected by many factors that may be different on the basis of Standalone Financials are as follows;

Particulars FY 2019 FY 2018		from what is envisaged in terms of future performance and outlook presented above.
Debtors Turnover (days)	62	72	For and on behalf of Board of Directors
Inventory Turnover	5.66	5.02
Interest Coverage Ratio	14.82	7.08	Sushil Suri (Chairman & Managing Director)
Current Ratio	0.88	0.70	DIN: 00012028 Place: New Delhi
Debt Equity Ratio	0.47	0.49	th Date: 27 July, 2019
Operating Profit Margin	4.26%	5.42%
Net Profit Margin	3.97%	4.66%

Your Directors would also like to take this opportunity to Certain statements contained in the Management forward to their continued contribution. future plans and projections may be forward looking statements within the meaning of applicable laws and KEY FINANCIAL RATIOS regulations and have been made in good faith. The actual Key financial parameters as on closure of the financial years from what is envisaged in terms of future performance and

ANNEXURE 'H'

CORPORATE GOVERNANCE REPORT

[Pursuant to Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, st 2015, as amended, and forming part of the Directors' Report for the year ended 31 March, 2019]

1. COMPANY'S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE

Presently 'Corporate Governance' has evolved to mean a framework of policies, processes and practices that ensure accountability, transparency, internal controls, compliance of laws and fairness in all the dealings between management and various stakeholders of the Company. It is about commitment to the values and ethical business conduct. Corporate Governance includes the processes through which corporate objectives are set and pursued. The Board of Directors along with the management of Morepen Laboratories Limited ('Morepen') strive to practice best in class policies and processes demonstrated through discipline and rigour by which the affairs of the Company are directed and controlled. Transparency, complete disclosure, accountability, integrity, professionalism, responsiveness, fairness and trusteeship are key principles which the Company follows in its day-to day functioning. The following are the practices adopted by Morepen for the Corporate Governance:

• • Providing complete, transparent, accurate and relevant disclosure/information to our shareholders, customers, vendors, employees and other stakeholders, including regulators.
• • Fixing accountability of the process in-charge. This ensures the protection of interest of the minority shareholders.
• • Conducting operations of the Company with integrity and ethically.
• • Ensuring that appropriately qualified and experienced professionals are entrusted with the responsibility of taking critical business decisions and monitoring the implementation thereof.
• • Providing timely and appropriate responses to the issues of the customers and shareholders.
• • Protecting and enhancing the long-term wealth of the shareholders.

This evolves from the basic principle that the Board of Directors and management are the trustees of the shareholders and ensure that the Company's affairs are being managed in a manner which ensures accountability, transparency and fairness in all transactions. The Company conducts its affairs in compliance with the principles of Corporate Governance prescribed in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, ('Listing Regulations').

2. BOARD OF DIRECTORS

st Composition and Category of the Board of Directors as on 31 March, 2019

The composition of Board is in conformity with Regulation 17 of the Listing Regulations and as per the Companies Act, 2013 ('the Act'), as amended. The Board has optimum combination of Executive and Non-Executive Directors with one Woman Director, the Chairman being an Executive Director, not less than fifty percent of the Board of Directors comprise of Non-Executive Independent Directors. The Board consists of six (6) Directors including two (2) Executive Directors, three (3) Non-Executive Independent Directors and one (1) Non- Executive Director.

All Independent Directors are eminent professionals bringing wide range of experience in strategy, finance and law. None of the Directors on the Board is a member of more than 10 Committees or Chairman of more than 5 (five) Committees across all companies in which he/ she is a Director. During the Financial Year 2018-19, the time gap between any two Board Meetings did not exceed one hundred and twenty days.

Except Mr. Sushil Suri and Mrs. Anju Suri, none of the Directors of the Company are, inter-se, related to each other. st The Board composition, directorships and board committee positions, including that of the Company, as on 31 March, 2019 are given below:

Name of Director	Category	No. of 1 Directorships	Committee' Membership in Listed and 2 Unlisted Companies	Committee' Chairmanship in Listed and 2 Unlisted Companies
Mr. Sushil Suri	Chairman & Managing Director- Promoter & Executive Director	1	1	Nil
Mr. Manoj Joshi	Non-Executive Independent Director	1	2	2
Mr. Sukhcharan Singh	Non-Executive Independent Director	2	3	Nil
Mr. B. R. Wadhwa	Non-Executive Independent Director	2	2	1
Dr. A. K. Sinha	Whole-time Director- Executive Director	1	Nil	Nil
Mrs. Anju Suri	Promoter, Non-Executive Director	4	1	1

Composition of Board of Directors of the Company is as follows:

1 Excludes directorships in foreign companies, companies registered under Section 8 of the Act, private limited companies and alternate directorships.

Includes membership(s) /chairmanship(s) of only Audit Committees and Stakeholders' Relationship Committees in all public limited companies.

Except Mrs. Anju Suri, none of the aforesaid Directors are acting as Director in any other listed entity. Pursuant to provisions of SEBI (LODR) (Amendment) Regulations, 2018, the details of listed entity and category of directorship of Ms. Anju Suri is as follows;

Name of Director Name of other listed entity wherein person st acting as Director as on 31 March, 2019		Category of Directorship
Mrs. Anju Suri	Blue Coast Hotels Limited	Non-Executive Director

Disclosure regarding Appointment, Re-appointment and Resignation of Directors

• 1. During the year under review, Mr. Sushil Suri (DIN 00012028) was re-appointed as a Chairman & Managing th th st Director (Executive Director) w.e.f., 20 October, 2018 to 19 October, 2023 at the Annual General Meeting held on 21 September, 2018.
• 1. On March 30, 2019, the Board of Directors of the Company has re-appointed Dr. Arun Kumar Sinha (DIN: 00450783) as a Whole Time Director (i.e., Executive Director), subject to approval of shareholders at this Annual General Meeting.
• 1. The Board of Directors of the Company in its meeting, decided to increase in the remuneration of Mr. Sushil Suri, up-to an amount of Rs. Five Crore annually, subject to approval of shareholders at this Annual General Meeting.
• th 4. The existing term of Mr. Bhupender Raj Wadhwa, Mr. Sukhcharan Singh and Mr. Manoj Joshi will be expired on 18 September, 2019, the Board of Directors of the Company intended to re-appoint them for Second Term of 5 consecutive years, subject to approval of shareholders at this Annual General Meeting.
• 1. Mrs. Anju Suri, Non-Executive Director of the Company, is liable to retire by rotation at this Annual General Meeting, being eligible and offer herself for re-appointment.

Number of shares and convertible instruments held by Non-Executive Directors

None of the Non-Executive Directors of the Company hold any share/ convertible instruments of the Company except Mrs. Anju st Suri. She holds 51,86,369 Equity Shares of the Company as on 31 March, 2019.

Number of Board Meetings and attendance of each Director at the Board Meetings and the last Annual General Meeting (AGM)

th th st During the Financial Year 2018-19, the Board met five times i.e., on 16 May, 2018, 13 August, 2018, 01 November, 2018, th th 04 February, 2019 and 30 March, 2019. The Annual General Meeting ('AGM') for the financial year 2017-2018, was held on st 21 September, 2018. Attendance of the Directors at the Board Meetings and AGM are as follows:

Name of Director	No. of Board meetings held during the tenure	No. of Board meetings attended	Attendance at last AGM
Mr. Sushil Suri	5	5	Yes
Mr. Manoj Joshi	5	5	Yes
Mr. Sukhcharan Singh	5	5	No
Mr. B. R. Wadhwa	5	5	No
Dr. A. K. Sinha	5	3	No
Mrs. Anju Suri	5	5	No

The gap between two Board meetings did not exceed one hundred and twenty days. Board meeting dates were finalised in consultation with the Directors and Notice of the meetings alongwith detailed agenda and other background notes or information, which were essential for the Board to effectively and reasonably perform their duties and functions, were circulated well in advance thereby enabling the Board to take informed decisions.

Independent Directors

The Company has received necessary declaration from each Independent Director as per the provisions of Section 149(7) of the Act that they meet the criteria of independence laid down in Section 149(6) of the Act. Additionally, they complying criteria of independence prescribed in clause (b) of sub-regulation (1) of regulation 16.

th During the year under review a separate meeting of the Independent Directors of the Company was held on 04 February, 2019, without the presence of Non-Independent Directors and members of the Management. All the Independent Directors of the Company were present in the meeting.

The Board of Directors of the Company is in form opinion that the all three independent directors of the Company fulfil all the requirements/ conditions related to Listing Regulation and the Companies Act, 2013 and its rules made thereunder and are truly independent of the Management of the Company. During the year, there were no any Independent Director resigned before the expiry of his tenure.

Familiarisation Programme for Independent Directors

The Company has put in place a system to familiarise the Independent Directors about the Company's profile, products, business performance, market presence, constitution, board procedures, major risks and risk management strategy, regulatory compliance status, values and commitments of the Company, through presentations at Board and Committee Meetings. The details of such familiarisation programme for Independent Directors is also available at website of the Company and can be accessed at: http://www.morepen.com/pdf/ Familiarisation-Programme-for-Independent-Directors.pdf

Performance Evaluation of Board, Committees & Individual Directors

The Company, under the Performance Evaluation Policy, has laid down the process and mechanism for evaluating the performance of the Board, Committees thereof, individual Directors and Chairman of the Board. As per the requirements of the Act and the Listing Regulations, annual performance evaluation of Board, Independent Directors, Non-Executive Director, Executive Director, Committees and Chairman of the Board is required to be carried out during a year. Such evaluation has been carried out as per Director's Performance st Evaluation Policy during the financial year ended 31 March, 2019.

Details of skills/expertise/competence of Board of Directors

The Directors of the Company have rich and diversified experience in the fields of managerial entrepreneurship, management, administration, pharmaceuticals, banking, finance and taxation.

The core competencies of each Director has been identified by the Board of Directors as required in the context of Company' business and pharmaceutical sector for an efficient functioning and growth.

3. AUDIT COMMITTEE

The Company has an Audit Committee, as per the requirements of Regulation 18 of the Listing Regulations and Section 177 of the Act. The terms of reference of the Audit Committee includes the matters specified under Regulation 18 and Part C of Schedule II of the Listing Regulations and Section 177 of the Act, as amended from time to time and other matters referred by Board.

Composition of the Committee

The Audit Committee comprises following members of the Board of Directors

S. No.	Name of the Committee' member	Category	Status
01	Mr. Manoj Joshi	Non-Executive Independent Director	Chairman
02	Mr. Bhupender Raj Wadhwa	Non-Executive Independent Director	Member
03	Mr. Sukhcharan Singh	Non-Executive Independent Director	Member

All the members of the Committee are financially literate i.e., have the ability to read and understand financial statements. Provided majority of the members of the Audit Committee possesses accounting or related financial management expertise. The meeting of Audit Committee is also attended by the Chief Financial Officer, Statutory Auditors and Internal Auditors of the Company. The Company Secretary of the Company acts as the Secretary to the Committee.

Meetings and attendance during the year

th th st th During the period under review, four meetings were held i.e., on 16 May, 2018, 13 August, 2018, 01 November, 2018 and 04 February, 2019. The attendance of members are as follows:

S. No.	Name of the Committee' member	No. of meetings held during the year	Attendance
1.	Mr. Manoj Joshi	4	4
2.	Mr. Sukhcharan Singh	4	4
3.	Mr. B. R. Wadhwa	4	4

As per Regulation 18(1) of the Listing Regulations, Section 177 of the Act and the Secretarial Standards, Mr. Manoj Joshi, the Chairman of the Committee was present at the last AGM of the Company to answer the shareholder's queries.

Brief terms of reference of the Audit Committee

The terms of reference, role and powers of the Audit Committee are as per the applicable provisions of the Act and Listing Regulations, and includes the following:

• Examination and overseeing of Company's financial reporting process and the disclosure of its financial information;
• Recommending to the Board, the appointment, reappointment, remuneration/audit fees, terms of appointment and removal, as and when required, of the statutory and internal auditors of the Company;
• Approving or any subsequent modification of transactions of the Company with related parties;
• Reviewing the annual Financial Statements with the Management, before submission to the Board for approval, with particular reference to:
• a) changes, if any, in accounting policies and practices and reasons for the same;
• b) major accounting entries involving estimates based on the exercise of judgment by management;
• c) significant adjustments made in the financial statements arising out of audit findings;
• d) compliance with listing and other legal requirements relating to Financial Statements;
• e) disclosure of any related party transactions.
• Reviewing the matters required to be included in the Director's Responsibility Statement to be included in the Board's Report in terms of Section 134 of the Act;
• Reviewing, with the management, the statement of uses / application of funds raised through an issue, the statement of funds utilized and making appropriate recommendations to the Board to take up steps in this matter;
• Reviewing the Internal Audit Report presented by the internal auditors including the independence, adequacy and effectiveness of the overall internal audit function and evaluation of the external and internal auditors;
• Reviewing any internal investigations by the internal auditors into areas of suspected fraud or irregularity of a material nature and reporting the matter to the Board;
• Reviewing and evaluating internal financial controls, adequacy of the internal control and risk management systems;
• Reviewing the functioning of the Whistle Blower Mechanism; Assess the causes for substantial defaults in payment to the depositors, creditors and shareholders (for unpaid dividend, if any);
• Approval of appointment of Chief Financial Officer after assessing the qualifications, experience and background, etc.;
• Any other matters as may be mentioned in the terms of reference of the Audit Committee. The Audit Committee provides assurance related to the adequacy of internal control system, financial performance and disclosures to the Board.

4. NOMINATION AND REMUNERATION COMMITTEE

The Company has a duly constituted Nomination & Remuneration Committee. The Committee's constitution and terms of reference are in compliance with the provisions of Regulation 19 and Part D of Schedule II of the Listing Regulations and Section 178 of Companies Act, 2013, as amended, from time to time and other matters referred by the Board.

Composition of the Committee

The Nomination & Remuneration Committee comprises following members of the Board of Directors;

S. No.	Name of the Committee' member	Category	Status
1.	Mr. Manoj Joshi	Non-Executive Independent Director	Chairman
2.	Mr. Bhupender Raj Wadhwa	Non-Executive Independent Director	Member
3.	Mr. Sukhcharan Singh	Non-Executive Independent Director	Member

Pursuant to provisions of Regulation 19 of the Listing Regulations, all the members of Nomination and Remuneration Committee of the Company are non-executive independent directors of the Company. The Company Secretary of the Company acts as the Secretary to the Committee.

Meetings and attendance during the year:

th th During the period under review, five meetings of Nomination and Remuneration Committee were held i.e., on 16 May, 2018, 13 st th th August, 2018, 01 November, 2018, 04 February, 2019 and 30 March, 2019. The attendance of members are as follows:

S. No.	Name of the Committee' member	No. of meetings held during the year	Attendance
1.	Mr. Manoj Joshi	5	5
2.	Mr. Sukhcharan Singh	5	5
3.	Mr. Bhupender Raj Wadhwa	5	5

As per Regulation 19(3) of the Listing Regulations, Section 178 of the Companies Act 2013 and the Secretarial Standards, Mr. Manoj Joshi, Chairman of the Committee was present at the last AGM of the Company to answer the shareholder's queries.

Brief terms of reference of the Nomination and Remuneration Committee

The terms of reference, role and powers of the Nomination and Remuneration Committee are as per the applicable provisions of the Act and Listing Regulations and includes the following:

• Formation of criteria for determining qualification, positive attributes and independence of Directors; Recommendation of the remuneration policy for the Directors, Key Managerial Personnel, and other senior management personnel to the Board;
• Formulation of criteria for evaluation of Directors, the Board and the Committees thereof; Recommendation of remuneration of the Managing Director(s) and Whole-time Director(s) based on their performance and defined assessment criteria and commissions to Non-Executive Directors;
• Identifying persons who are qualified to become Directors and who may be appointed as Key Managerial Personnel in accordance with the criteria laid down and recommending to the Board their appointment, removal, and other terms as may be referred by the Board from time to time.

Performance evaluation of Directors and criteria for Independent Directors

The Nomination & Remuneration Committee carries out the evaluation of performance of individual Directors. Further, in accordance with Schedule IV to the Act and Regulation 17(10) the Listing Regulations, performance evaluation of Independent Directors is done by the entire Board excluding the Director being evaluated.

5. REMUNERATION TO DIRECTORS

Nomination and Remuneration Policy

The Nomination and Remuneration Policy of the Company is available on the website of the Company at http://www.morepen.com/pdf/Nomination-and-Remuneration-Policy.pdf. The Remuneration to the Executive is paid in accordance with the provisions of the Act, within the limits set out thereunder, Articles of Association of the Company and as per the Nomination and Remuneration Policy of the Company. Nomination and Remuneration Policy of the Company is aimed at:

• Identifying persons who are qualified to become Directors and persons who may be appointed at senior management and Key Managerial positions;

• Attracting talented managerial persons taking into account the talent market, the remuneration trend and the competitive requirement of the business;
• Retaining high-calibre talent; and
• Determining remuneration of Directors and Key Managerial Personnel.

Presently, except sitting fees Non-Executive Directors are not paid any remuneration. Further, none of the Non-Executive Directors have any pecuniary relationship or transaction vis-a-vis the Company.

Details of remuneration disbursed to Executive Directors of the Company, during the period under review are as under:

					( ` in Lakh)
Name of Director	Salary	Perks	Commission	Sitting Fee	Total
Mr. Sushil Suri	109.33	11.86	–	–	121.19
Dr. A. K. Sinha	6.00	–	–	–	6.00

Independent Directors are paid by way of sitting fees for attending meetings of the Board & Committees thereof. Details of sitting fee paid to Non- Executive Directors of the Company, during the year under review are as under;

Name of Director	Sitting Fee ( ` in Lakh)
Mr. Manoj Joshi	2.05
Mr. Sukhcharan Singh	1.90
Mr. B. R. Wadhwa	1.70
Mrs. Anju Suri	Nil

There is no separate service contract executed with Directors of the Company, the terms and condition including notice period, severance fees etc., are as per appointment letter and in accordance with the policy of the Company. The Company does not have any stock option scheme.

6. STAKEHOLDERS RELATIONSHIP COMMITTEE

Pursuant to compliance of Regulation 20 and Part D of Schedule II of Listing Regulations and Section 178 of the Act, as amended from time to time, The Company have a duly constituted Stakeholders Relationship Committee.

Composition of the Committee:

The Stakeholders Relationship Committee comprises following members of the Board of Directors;

S. No.	Name of the Committee' member	Category	Status
1.	Mr. Manoj Joshi	Non-Executive Independent Director	Chairman
2.	Mr. Sushil Suri	Executive Director	Member
3.	Mr. Sukhcharan Singh	Non-Executive Independent Director	Member

Mr. Vipul Kumar Srivastava, Company Secretary of the Company, has been designated as Compliance Officer of the Company and acts as the Secretary of the Committee. Pursuant to Section 178(7) of the Act read with Regulation 20 of the Listing Regulations and the Secretarial Standards, Mr. Manoj Joshi, the Chairman of the Committee was present at the last AGM of the Company to answer the shareholder's queries.

Role of Stakeholders' Relationship Committee

The role and terms of reference of Stakeholders' Relationship Committee are as follows:

• Redressal of grievances of shareholders, including complaints related to the transfer of shares;
• Collecting and analysing reports received periodically from the Registrar and the Share Transfer Agent;
• Allotment of shares, approval of transfer or transmission of shares, debentures or any other securities;
• Issue of duplicate certificates and new certificates on split/consolidation/renewal;
• Non-receipt of declared dividends, balance sheets, annual report or any other documents or information sent by the Company to its shareholders.

The Company and its Registrar & Share Transfer Agent attend all grievances received from the shareholders. Efforts are made to ensure that all the grievances of the shareholders are redressed expeditiously and satisfactorily. A separate e-mail i.d., investors@morepen.com, has been designated by the Company for the shareholders to lodge their complaints / queries.

Communication by Shareholder's holding shares in demat mode should address their correspondences relating to updates in their details, viz., address, bank accounts, contact number, etc. to their respective Depository Participants. The Company has also send communication to the shareholders for updation of PAN and Bank Accounts details etc., in compliance of SEBI Circular no. th SEBI/HO/MIRSD/DOP1/CIR/P/2018/73 dated 20 April, 2018 and amendment thereto.

Shareholder's holding shares in physical mode, may address such correspondences either to the Company Secretary of the Company or Mas Services Limited (Registrar and Share Transfer Agent of the Company). However, queries relating to non-receipt of dividend or nonreceipt of annual reports of the Company should also be addressed to the Company. Members are requested to indicate their DP ID & Client ID/ Ledger Folio number in their correspondence with the Company and also to provide their email addresses and telephone numbers to facilitate prompt response from the Company.

The Shareholders are also informed that pursuant to SEBI (Listing Obligations and Disclosure Requirements) (Fourth Amendment) th Regulations, 2018, dated 8 June 2018, which provided that except in case of transmission or transposition of securities, requests for effecting transfer of securities shall not be processed unless the securities are held in the dematerialized form with a depository. After st extension of applicability, it is mandatory to have shares in dematerialized form for effecting transfer of shares w.e.f., 1 April, 2019

SEBI Complaints Redressal System (SCORES):

The Company has registered with SCORES. In SCORES, the investor complaints may be processed in a centralized web based complaints redressal system. The salient features of this system are Centralized database of all complaints, online upload of Action Taken Reports (ATRs) by the Company and online viewing by investors/shareholder of actions taken on the complaint and its current status.

The Company has received 15 shareholders'/investors' complaints during the year and all complaints have been resolved/answered to st the satisfaction of the shareholders. No complaint remained un-attended/pending for more than 30 days. As on 31 March, 2019, one investor complaint was outstanding/pending, which has been resolved as on signing of this Directors Report.

7. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Company have also a duly constituted Corporate Social Responsibility Committee in compliance of Section 135 of the Companies Act, 2013 and its rules made thereunder.

Composition of the Committee:

Corporate Social Responsibility (CSR) Committee was constituted by the Board of Directors of the Company. The Composition of the CSR Committee are in compliance with the provisions of Section 135 of the Act. The CSR Committee is comprising following members:

S. No.	Name of the Committee' member	Category	Status
1.	Mr. Sushil Suri	Executive Director	Chairman
2.	Mr. Bhupender Raj Wadhwa	Non-Executive Independent Director	Member
3.	Mr. Manoj Joshi	Non-Executive Independent Director	Member

Role of Corporate Social Responsibility Committee

The Role and Terms of Reference of the CSR Committee, includes the following:

• Formulate and update the CSR Policy;
• Decide the CSR activities to be taken up by the Company in accordance with the CSR Policy;
• Decide the amount to be allocated for each project or activity;
• Oversee and monitor the progress of the initiatives rolled out under this Policy;
• Submit a report, to the Board on all CSR activities undertaken during the Financial Year.

th th During the year two meetings of the Corporate Social Responsibility Committee were held on i.e., 16 May, 2018 and 04 February, 2019. The requisite quorum was present at both the meetings. Further, Mr. Vipul Kumar Srivastava, Company Secretary of the Company acts as the Secretary of the Committee.

The CSR Policy of the Company is available on the website of the Company at the following address at http://www.morepen.com/pdf/Corporate-Social-Responsibility-Policy.pdf

8. GENERAL BODY MEETINGS

The General Body Meetings i.e., Annual General Meetings were held in accordance with the requirements of Listing Regulations and the Companies Act, 2013.

Financial Year	Date & Time	Location	Special Resolution(s) Passed
2017-18	21.09.2018 at 10.30 a.m.	Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh	–
2016-17	22.09.2017 at 10.30 a.m.	Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh	–
2015-16	23.09.2016 at 10:30 a. m.	Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh	–

Details of last three Annual General Meetings (AGMs):

There was no any Special Resolution passed through postal ballot, during the period under review. None of the businesses proposed to be transacted at the ensuing Annual General Meeting require to be transacted through postal ballot. There was no any Extra-Ordinary General Meeting held during the year under review.

9. MEANS OF COMMUNICATION

Financial Results: The results (quarterly and yearly) of the Company are published within 48 hours in 'Financial Express' (English) and 'Jansatta' (Hindi) newspapers within 48 hours of approval thereof and shall also be posted on Company's website viz., www.morepen.com

Annual Report: The Company has sent Annual Reports, notices, and other communications to the shareholders electronically on their email IDs as registered in the depository system. Physical copies of such communications are sent to other shareholders, whose email IDs are not registered in depository system, through the prescribed modes of postage.

Website: The Company's website i.e., www.morepen.com, contains a separate section wherein shareholders' related information are updated periodically and are available in a user-friendly and downloadable form.

News Release and presentation etc.: The press releases and official news, as applicable, are displayed on the Company's website on the happening of any material event, an official news release is made to the Newspapers/Press, Stock Exchanges and the same is also displayed on the Company website and disseminated to Stock Exchanges.

	Symbol ISIN No. RIC Code	MOREPENLAB INE083A01026 Morl.ns	Scrip Code ISIN No. RIC Code	500288 INE083A01026 Morl.ns
Stock code	NSE		BSE
	BSE Limited (BSE) Floor 25, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai – 400 001 Listing fees for the year 2019-20 has been duly paid to NSE & BSE.
Stock Exchanges	National Stock Exchange of India Limited (NSE) Exchange Plaza, Bandra-Kurla Complex, Bandra (E), Mumbai – 400 051
		The Board of Directors of the Company has not recommended dividend for the st financial year ended 31 March, 2019.
Date of Book Closure		The dates of book closure will be from Saturday, 7 September, 2019 to Friday 13 September, 2019 (both days inclusive) for AGM.	th	th
Financial Year	st st 1 April, 2018 to 31 March, 2019
Date, Time and Venue of Annual General Meeting (AGM)	th Friday, 13 September, 2019 at 10:00 a.m. at Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh – 173 205

10. GENERAL SHAREHOLDER INFORMATION

f) Market Price Data:

Month	BSE		NSE
	High Price	Low Price	High Price	Low Price
Apr-18	41.30	31.00	41.35	31.00
May-18	38.15	26.25	38.25	26.15
Jun-18	33.95	24.70	34.00	24.70
Jul-18	37.10	25.50	37.10	25.60
Aug-18	36.25	27.65	36.30	27.50
Sep-18	30.35	23.05	30.35	23.15
Oct-18	26.95	19.20	26.90	18.80
Nov-18	27.80	21.50	26.60	21.50
Dec-18	24.40	19.50	24.40	19.25
Jan-19	22.35	19.30	22.45	19.50
Feb-19	20.40	14.70	20.45	14.55
Mar-19	20.15	16.60	20.20	16.55

(Source: Official website of BSE & NSE)

g) Performance of Morepen Share Price in comparison to broad based indices such as NSE – Nifty 50 and BSE Sensex

st j) Distribution of shareholding as on 31 March, 2019

Category of Shareholdings From – To	No. of shareholders	% of shareholders	Total Shares	Amount (Rs.)	% of total Amount
1 - 5,000	1,24,645	91.30	7,68,46,390	15,36,92,780	17.08
5,001 - 10,000	6,995	5.12	2,48,74,727	4,97,49,454	5.53
10,001 - 20,000	2,782	2.03	2,03,54,352	4,07,08,704	4.52
20,001 - 30,000	788	0.57	99,27,663	1,98,55,326	2.21
30,001 - 40,000	375	0.27	66,70,776	1,33,41,552	1.48
40,001 - 50,000	215	0.15	49,28,427	98,56,854	1.10
50,001 - 1,00,000	405	0.29	1,43,36,828	2,86,73,656	3.19
1,00,001 and above	312	0.22	29,18,87,040	58,37,74,080	64.89
Total	1,36,517	100.00	44,98,26,203	89,96,52,406	100.00

thereunder related to Share Transfer(s).

Category	No. of shares held	Shareholding (%)
Promoters & Promoters Group	15,53,71,588	34.54
Financial Institutions/Banks	19,45,445	0.43
Insurance Companies	2,16,64,879	4.82
FIIs and Foreign Portfolio Investors	4,20,57,700	9.35
Bodies Corporate	1,83,86,091	4.09
Individuals	18,21,38,664	40.49
NRI & OCBs	2,65,33,998	5.90
Others (Clearing Member, Trust & NBFCs)	17,27,838	0.38
Total	44,98,26,203	100.00

Liquidity

k) Dematerialization of Shares and The Equity Shares of the Company are in compulsory de-mat segment and are available for trading in the depository systems of both the National Securities Depository Limited and the Central Depository Services (India) Limited. The ISIN Number st of Company on both the NSDL and CDSL is INE083A01026. As on 31 March, 2019, 37,93,43,404 Equity Shares of ` 2/- each (84.33%) are held in electronic/de-mat form.

l) Outstanding GDRS/ADRS/Warrants or any Convertible Instruments, Conversion Date and Likely Impact on Equity:

Type of Security	Date of Conversion	Likely impact on Equity
97,35,201 - 0.01% Optionally Convertible Preference Shares (OCPS)	Optionally Convertible into Equity Shares at the end of 7 years from the respective date of its allotment.	The impact on equity would be determined only at the time of conversion of Preference Shares into Equity.
The above shares have been allotted as per the following details: i. 70,40,276 allotted on May 4, 2007; ii. 17,62,000 allotted on May 31, 2007; and iii. 9,32,925 allotted on February 9, 2008	97,35,201 0.01% OCPS have fallen due for redemption/conversion as follows: i. 70,40,276 due on May 4, 2014; and ii. 17,62,000 due on May 31, 2014; iii. 9,32,925 due on February 9, 2015	The Equity Shares, if opted, would be allotted at a price determined as per the provisions of SEBI (ICDR) Regulations, 2009 and other laws as may be applicable.
m) Commodity price risk or foreign exchange risk and hedging activities	The Company is not engaged in commodity trading, hedging or exchange risk mana gement activities.
n) Plant Locations	• Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh - 173 205 • Plot No.12 B & Plot No.12 C, Sector - 2, Parwanoo, District Solan, Himachal Pradesh - 173 220 • Village Masulkhana, District Solan, Himachal Pradesh - 173 220

Address for correspondence	Registered Office:
	Morepen Village, Nalagarh Road,
	Near Baddi, Distt. Solan, Himachal Pradesh - 173 205
	Tel No.: 01795 - 276201/02/03; Fax No.: 01795 - 276204
	Email id: investors@morepen.com; Website: www.morepen.com
	Corporate Office:
	409, Antriksh Bhawan, 22, K.G. Marg, New Delhi - 110 001
	Tel No.: 011 - 2332 4443/2371 2025 Fax No.: 011 - 2372 2422
	Email id: investors@morepen.com; Website: www.morepen.com
	Investor Correspondence (RTA):
	MAS Services Ltd.
	Unit: Morepen Laboratories Limited
	nd T-34, 2 Floor, Okhla Industrial Area, Ph. - II, New Delhi - 110 020
	Tel No.: 011 - 2638 7281/82/83; Fax No.: 011 - 2638 7281 Email id: info@masserv.com; Website: www.masserv.com
Credit Rating	The Company didn't issue any debt instruments or any fixed deposit or have any scheme or proposal involving mobilization of funds, whether in India or abroad, therefore, there is no need to have credit rating(s) from any Credit Rating Agencies,

11. DEPOSITORY SERVICES

Shareholders may write to the Company or to the respective Depositories for any guidance on depository services:

National Securities Depository Ltd.	Central Depository Services (India) Ltd.
th Trade World, 4 Floor,	Phiroze Jeejeebhoy Towers,
Kamla Mills Compound,	th 28 Floor,
Senapati Bapat Marg, Lower Parel,	Dalal Street,
Mumbai - 400 013	Mumbai - 400 023
Telephone : 022 - 2497 2964-70	Telephone : 022 - 2272 3333-3224
Fax : 022 - 2497 2993, 022-2497 6351	Fax : 022 - 2272 3199

12. CORPORATE GOVERNANCE COMPLIANCE

The Company complies with the Corporate Governance Requirements specified in Regulation 17 to 27 and Clauses (b) to (i) of sub-regulation 2 of Regulation 46 of the Listing Regulations.

13. OTHER DISCLOSURES

a) Disclosures on Materially significant related party transactions that may have potential conflict with the interests of the Company at large:

There were no materially significant related party transactions during the financial year 2018-19 which are considered to have potential conflict with the interests of the Company at large. Particulars and nature of transactions with the related st parties in summary form, duly reviewed by Audit Committee, be entered into during the year ended 31 March, 2019, in the ordinary course of business of the Company and at arm's length basis are disclosed in compliance with the Indian Accounting Standard on "Related Party Disclosures" in Note No. 33 of Notes to financial statements in the Annual Report.

The Company' Policy on Related Party Transactions is available on website of the Company and can be accessed at http://www.morepen.com/ pdf/Policy-on-Dealings-with-Related-Party-Transactions.pdf.

b) Details of non-compliance by the Company, penalties, and strictures imposed on the Company by Stock Exchange or SEBI or any Statutory Authority, on any matter related to capital markets, during the last three years:

The Company has complied with the requirements of Stock Exchanges, Securities and Exchange Board of India and other statutory authorities /regulatory on matters relating to capital markets during the last three years and consequently no penalties or strictures have been imposed on the Company by any of these authorities.

However, pursuant to Corporate Debt Restructuring Scheme approved by the CDR cell, there were Equity Shares allotted to the lenders of the Company in satisfaction of their outstanding debts. Out of which, 3,75,750 Equity Shares are yet to be listed and the Company has approached to Stock Exchange(s) and SEBI to list those shares. The application is pending with authorities.

c) Details of establishment of vigil mechanism, whistle blower policy and affirmation that no personnel have been denied access to the Audit Committee:

The Company has adopted a Vigil Mechanism/Whistle Blower Policy for developing a culture where it is safe for all directors/employees to raise concerns about any unacceptable practice and any event of misconduct. The Policy allows unrestricted access to all employees and others to approach the Audit Committee and there has been no instance during the year where any personnel has been denied access to the Audit Committee.

d) Details of compliance with mandatory requirements and adoption of the non-mandatory requirements:

The Company has generally complied with all the mandatory requirements as stipulated under Regulation 34(3) read with Para C of Schedule V of the Listing Regulations, to the extent applicable to the Company.

e) Disclosures related to policy for 'material' subsidiary

None of the subsidiary companies including wholly owned subsidiary of the Company is a material non-listed subsidiary as defined in Regulation 24 of the Listing Regulations. The Audit Committee of the Company periodically reviews the financial statements, in particular, the investments made by the unlisted subsidiary companies. The Minutes of the Board Meetings and financial statements of all wholly owned unlisted subsidiary Companies are circulated along with agenda and are also placed before the Meeting(s) of the Board of Directors of the Company. The Policy for determining the 'material' subsidiaries is in accordance with the definition of 'material subsidiary' as contained in Regulation 16(1)(c) of the Listing Regulations and the same is available on the website of the Company at following web link at http://www.morepen.com/pdf/Policy-for-Determining-Material-Subsidiary.pdf

f) Disclosures related to policy on dealing with Related Party Transaction

The Company has formulated a policy on materiality of Related Party Transactions and also on dealing with Related Party Transactions. The said Policy is available on the website of the Company and can be accessed through web link at http://www.morepen.com/pdf/Policy-on-Dealings-with-Related-Party-Transactions.pdf

g) Disclosures related commodity price risks and commodity hedging activities

The Company is not engaged in the business related to commodity therefore this clause is not applicable on the Company.

h) Disclosures related to utilization of funds raised through preferential allotment or qualified institutional placement

The Company has not raised any funds through preferential allotment or qualified institutional placement during the year under review.

i) Certificate of Practicing Company Secretary for Board of Directors

A Certificate has been obtained from Mr. Praveen Dua, Company Secretary in practice that none of the Directors on the Board has been debarred or disqualified from being appointed/re-appointed or continuing as Director of companies by SEBI/Ministry of Corporate Affairs or any such statutory authority.

J) Disclosures related to recommendation of Committee(s) of the Board of Directors of the Company

There is no any instance wherein the Board had not accepted any recommendation of any committee of the board which is mandatorily required, during the financial year. The Board had considered all the recommendation of / submissions of the Committee before passing any resolution.

k) Disclosures related to total fees paid to Statutory Auditors for all their services to the Company and its subsidiary

Total fees paid to Statutory Auditors for all services provided to the Company and its subsidiaries, on a consolidated basis, are disclosed in Note No. 29 of the Consolidated Financial Statements. The firm of Statutory Auditors does not have any network firm/network entity of which the Statutory Auditors are a part.

l) Disclosures under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 is as follows:

• (i) number of complaints filed during the financial year- NIL
• (ii) number of complaints disposed of during the financial year-NIL
• (iii)number of complaints pending as on end of the financial year-NIL

m) Disclosure related to compliance related to Corporate Governance

There is no non-compliance of any requirement of Corporate Governance as mentioned of Sub paras (2) to (10) of Part C of Schedule V of the Listing Regulations. The Company is complying with all compliance related to Corporate Governance requirements specified in Regulation 17 to 27 and clauses (b) to (i) of sub-regulation (2) of Regulation 46 of the Listing Regulations.

n) Disclosure related to adoption of discretionary requirements – Part E of Schedule II of Listing Regulations.

Out of discretionary requirements prescribed under Part-E of Schedule II of Listing Regulations, the Company has adopted requirement of unmodified audit opinion, reporting of internal auditors directly to the Audit Committee.

o) Chairman & Managing Director and Chief Financial Officer' declaration

In accordance with Regulation 17(8) read with Part B of Schedule II of the Listing Regulations, the Chairman & Managing Director and Chief Financial Officers have furnished a duly signed Compliance Certificate to the Board of Directors for the st year ended 31 March, 2019.

A declaration for compliance of Code of Conduct by the Board of Directors and Senior Management Personnel, duly signed by Chairman & Managing Director of the Company annexed with this report.

The Chairman & Managing Director and Chief Financial Officer have also certified to the Board in accordance with Regulation 33(2)(a) of the Listing Regulations pertains to Chairman & Managing Director and Chief Financial Officer st certificates for the financial year ended 31 March, 2019.

p) Compliance Certificate from Practicing Company Secretary for Corporate Governance Compliance

A certificate from Mr. Praveen Dua, Proprietor of PD & Associates, a firm of practicing company secretary, regarding compliance of conditions of corporate governance is annexed with Directors Report.

q) Code of Conduct to Regulate, Monitor and Report Trading by Insiders

Pursuant to SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended, and with a view to regulate trading in securities by the Promoters, Directors, Designated Persons, Employees and other connected persons, the Company has adopted a Code of Conduct to Regulate, Monitor and Report Trading by Insiders pursuant to compliance of SEBI (Prohibition of Insider Trading) (Amendment) Regulations, 2018.

r) Compliance related to Secretarial Standards as issued by the Institute of Company Secretaries of India

The applicable Secretarial Standards as issued by the Institute of Company Secretaries of India and approved by the Central Government has been duly complied with and adhered to by the Company.

14. EQUITY SHARES IN THE SUSPENSE ACCOUNT

In terms of Part F of Schedule V of the Listing Regulations, the Company hereby reports the following details in respect of Equity Shares lying in de-mat unclaimed suspense account of the Company which were issued in de-mat form and physical form:

Particulars	Number of shareholders	Number of Equity Shares
Aggregate number of shareholders and the outstanding shares st lying in the Unclaimed Suspense Account as on 1 April, 2018	4,885	54,16,993
Number of shareholders who approached the Company for transfer of shares from Unclaimed Suspense Account during the year	26	30,802
Number of shareholders to whom shares were transferred from the Unclaimed Suspense Account during the year	25	29,145
Aggregate number of shareholders and the outstanding shares st lying in the Unclaimed Suspense Account as on 31 March, 2019	4,860	53,87,848

Note: The voting rights in respect of the shares lying in the Unclaimed Suspense Account shall remain frozen till the rightful owner of such shares claims the shares.

For Morepen Laboratories Limited

Sushil Suri Place: New Delhi (Chairman & Managing Director) th Date: 27 July, 2019 DIN: 00012028

DECLARATION PURSUANT TO PART D OF SCHEDULE V OF SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015

In accordance with Part D of Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, I hereby declare that all the Directors and Senior Management Personnel of the Company have affirmed compliance with Code of Conduct of st Board of Directors and Senior Management, as applicable to them, for the year ended 31 March, 2019.

For Morepen Laboratories Limited

Sushil Suri Place: New Delhi (Chairman & Managing Director) th Date: 27 July, 2019 DIN: 00012028

CERTIFICATE FROM PRACTICING COMPANY SECRETARY

(Pursuant to clause 10(i) of Schedule V to SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015)

We, PD and Associates, Practicing Company Secretaries, hereby certify that none of the Directors on the Board of the Morepen Laboratories Limited (CIN: L24231HP1984PLC006028) ("the Company"), have been debarred or disqualified from being appointed or continuing as Directors of Companies by the Securities and Exchange Board of India (SEBI)/Ministry of Corporate Affairs or any such Statutory Authority.

For PD and Associates Company Secretaries

CS Praveen Dua

Place: New Delhi Proprietor th Date: 27 July, 2019 C.P. No.2139

CORPORATE GOVERNANCE COMPLIANCE CERTIFICATE PURSUANT TO PART E OF SCHEDULE V OF SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015

To,

The Shareholders / Members, Morepen Laboratories Limited

We have examined the compliance of conditions of Corporate Governance by Morepen Laboratories Limited ('the Company') for st the financial year ended on 31 March, 2019 as stipulated in Part E of Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended ('Listing Regulations') of the Company with Stock Exchanges.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to review of procedures and implementation thereof, adopted by the Company for ensuring the compliance with the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, of the above mentioned Listing Agreement.

On the basis of information/documents provided to us, we state that in respect of investor grievances received during the financial st year ended 31 March, 2019, no investor grievance is pending against the Company for a period exceeding one month as per the records maintained by the Company which are presented to the Stakeholders Relationship Committee (Shareholders/Investor Grievance Committee).

We further state that such compliance is neither an assurance as to the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the Company.

For PD and Associates Company Secretaries

Place: New Delhi Proprietor

CS Praveen Dua th Date: 27 July, 2019 C.P. No.2139

CMD AND CFO CERTIFICATE PURSUANT TO PART B OF SCHEDULE II OF SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015

To,

The Board of Directors/Audit Committee Morepen Laboratories Limited

We, Sushil Suri, Chairman & Managing Director and Ajay Sharma, Chief Financial Officer, of Morepen Laboratories Limited, hereby certify that:

• st a) We have reviewed financial statements and the cash flow statement for the financial year ended 31 March, 2019 and that to the best of our knowledge and belief:
• i. these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;
• ii. these statements together present a true and fair view of the Company's affairs and are in compliance with existing accounting standards, applicable laws and regulations.
• b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative of the Company's code of conduct.
• c) We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have evaluated the effectiveness of internal control systems of the Company pertaining to financial reporting and we have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to take to rectify these deficiencies.
• d) We have indicated to the auditors and the Audit committee
• i. significant changes in internal control over financial reporting during the year;
• ii. significant changes in accounting policies during the year and that the same have been disclosed in the notes to the financial statements; and
• iii. instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or an employee having a significant role in the Company's internal control system over financial reporting.

For Morepen Laboratories Limited For Morepen Laboratories Limited

Place: New Delhi Ajay Sharma Sushil Suri th Date: 4 May, 2019 (Chief Financial Officer) (Chairman & Managing Director) DIN: 00012028

Independent Auditor's Report

To the Members of Morepen Laboratories Limited

Report on the Audit of Standalone Financial Statements

We have audited the accompanying standalone financial year ended on that date. statements of Morepen Laboratories Limited ("the st Company"), which comprise the Balance Sheet as at 31 Basis for Opinion March, 2019, the Statement of Profit and Loss (including

Standards) Rules, 2015, as amended, ("Ind AS") and other opinion. accounting principles generally accepted in India, of the state

st Opinion of affairs of the Company as at 31 March, 2019, the profit and total comprehensive income, changes in equity and its cash flows for the

Other Comprehensive Income), Statement of Changes in We conducted our audit in accordance with the Standards on Equity and Statement of Cash Flows for the year then ended Auditing (SAs) specified under section 143(10) of the Act. Our and summary of significant accounting policies and other responsibilities under those Standards are further described in the explanatory information (hereinafter referred to as "the Auditor's Responsibilities for the Audit of standalone financial statements section of our report. We are independent of the standalone financial statements"). Company in accordance with the Code of Ethics issued by the In our opinion and to the best of our information and Institute of Chartered Accountants of India together with the according to the explanations given to us, the aforesaid independence requirements that are relevant to our audit of the standalone financial statements give the information required standalone financial statements under the provisions of the Act and by the Companies Act, 2013 ("the Act") in the manner so the rules thereunder and we have fulfilled our other ethical required and give a true and fair view in conformity with the responsibilities in accordance with these requirements and the Indian Accounting Standards prescribed under section 133 of Code of Ethics. We believe that the audit evidence we have the Act read with the Companies (Indian Accounting obtained is sufficient and appropriate to provide a basis for our

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

S. No.	Key Audit Matter	Auditor's Response
1	In the Scheme of Arrangement & Compromise under Section 391 of the Companies Act, 1956 as approved by the Hon'ble High Court of Himachal Pradesh th vide its Order dated 4 August, 2009, the Company allotted 9,24,90,413 Equity Shares to the fixed deposit holders in settlement of their dues. The th Hon'ble NCLT vide its judgment dated 12 March, 2018 dismissed the Company's petition seeking approval of the Scheme and stated that the order will not affect the allotment of the shares to the FD holders who have traded the shares to the third parties or transferred the allotted shares and to the balance FD holders the company shall pay the outstanding amount as per the scheme approved by the Company Law Board (CLB). On an appeal preferred by the company against the said order of NCLT, the Hon'ble National Company Law Appellate Tribunal (NCLAT) stayed the direction of NCLT and reserved the order for judgment after hearing the matter. Refer Note. No. 20 and 38(d) to the standalone financial statements.	Principal Audit Procedures We collected the following documents: th - Scheme approved by the Company Law Board (CLB) dated 19 August, 2003. - Scheme of Arrangement & Compromise under Section 391 of the Companies Act, 1956 approved by the Hon'ble High Court th of Himachal Pradesh dated 4 August, 2009. th - Judgment of Hon'ble NCLT dated 12 March 2018 dismissing the Company's petition seeking approval of the Scheme of arrangement with the Fixed Deposit holder. - Copy of order of Hon'ble National Company Law Appellate th Tribunal dated 27 April 2018 staying the direction issued by th Hon'ble NCLT in its order dated 12 March 2018. - Copy of order of Hon'ble National Company Law Appellate th Tribunal (NCLAT) dated 8 April 2019 reserving the order for judgement. We read and analysed the above orders/judgments. The outcome of the judgement may impact financials of the company.

Statements and Auditor's Report thereon statements

statements, our responsibility is to read the other information financial statements. and, in doing so, consider whether the other information is As part of an audit in accordance with SAs, we exercise materially inconsistent with the standalone financial professional judgement and maintain professional skepticism statements or our knowledge obtained during the course of throughout the audit. We also: our audit, or otherwise appears to be materially misstated.

matters stated in section 134(5) of the Act with respect to the override of internal control.

effectiveness of such controls. This responsibility also includes maintenance of adequate preventing and detecting frauds and other irregularities; disclosures made by management.

to going concern and using the going concern basis of as a going concern.

company's financial reporting process. that achieves fair presentation.

Information Other than the Standalone Financial Auditor's Responsibilities for the Audit of standalone financial

The Company's Board of Directors is responsible for Our objectives are to obtain reasonable assurance about whether preparation of the other information. The other information the standalone financial statements as a whole are free from comprises the information included in Annual Report, but material misstatement, whether due to fraud or error, and to issue does not include the standalone financial statements and our an auditor's report that includes our opinion. Reasonable auditor's report thereon. assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a Our opinion on financial statement does not cover the other material misstatement when it exists. Misstatements can arise from information and we do not express any form of assurance fraud or error and are considered material if, individually or in conclusion thereon. aggregate, they could reasonably be expected to influence the In connection with our audit of the standalone financial economic decisions of users taken on the basis of these standalone

• Identify and assess the risks of material misstatement of the If, based on the work we have performed, we conclude that financial statements, whether due to fraud or error, design there is material misstatement of this other information, we and perform audit procedure responsive to those risks, and are required to report that fact. We have nothing to report in obtain audit evidence that is sufficient and appropriate to this regard. provide a basis for our opinion. The risk of not detecting a Management's responsibility for the Standalone Financial material misstatement resulting from fraud is higher than for Statements one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or the The Company's Board of Directors is responsible for the
• preparation of these standalone financial statements that Obtain an understanding of internal financial controls give a true and fair view of the financial position, financial relevant to the audit in order to design audit procedures that performance, total comprehensive income, changes in are appropriate in the circumstances. Under section equity and cash flows of the company in accordance with 143(3)(i) of the Act, we are also responsible for expressing applicable Ind AS and other accounting principles generally our opinion on whether the company has adequate internal accepted in India. financial controls system in place and the operating
• accounting records in accordance with the provisions of the Evaluate the appropriateness of accounting policies used Act for safeguarding the assets of the Company and for and the reasonableness of accounting estimates and related
• selection and application of appropriate accounting policies; Conclude on the appropriateness of management's use of making judgements and estimates that are reasonable and the going concern basis of accounting and, based on the prudent; and design, implementation and maintenance of audit evidence obtained, whether a material uncertainty adequate internal financial controls, that were operating exists related to events or conditions that may cast significant effectively for ensuring the accuracy and completeness of the doubt on the company's ability to continue as a going accounting records, relevant to the preparation and concern. If we conclude that a material uncertainty exists, presentation of the standalone financial statement that give a we are required to draw attention in our auditor's report to true and fair view and are free from material misstatement, the related disclosures in the standalone financial statement whether due to fraud or error. or, if such disclosures are inadequate, to modify our opinion. In preparing the financial statements, the Board of Directors Our conclusions are based on the audit evidence obtained is responsible for assessing the company's ability to continue up to the date of our auditor's report. However, future events as going concern, disclosing, as applicable, matters related or conditions may cause the company to cease to continue
• accounting unless the Board of Directors either intends to Evaluate the overall presentation, structure and content of liquidate the company or to cease the operations, or has no the standalone financial statements, including the realistic alternative but to do so. disclosures and whether the standalone financial statements The Board of Directors are responsible for overseeing the represent the underlying transaction and events in a manner

financial statements may be influenced. We consider books of accounts. quantitative materiality and qualitative factor in (i) d) In our opinion, the aforesaid standalone financial planning the scope of our audit work and in evaluating statements comply with the Indian Accounting the results of our work; and (ii) to evaluate the effect of Standards prescribed under section 133 of the Act read any identified misstatements in the financial with relevant rules issued thereunder. statements.

From the matters communicated with those charged g) With respect to the other matters to be included in the with governance, we determine those matters that Auditor's Report in accordance with the requirements were of most significance in the audit of the standalone of section 197(16) of the Act, as amended: financial statements of the current period and are matter should not be communicated in our report section 197 of the Act. because the adverse consequences of doing so would h) With respect to the other matters to be included in the

• according to the explanations given to us: 1. As required by the Companies (Auditor's Report) Order, 2016 ("the Order"), issued by the Central (i) The Company has disclosed the impact of pending Government in terms of section 143(11) of the Act, we litigations on its financial position in its standalone give in Annexure A, a statement on the matters financial statements. specified in paragraphs 3 and 4 of the Order, to the (ii) The Company did not have any long term
• 1. As required by Section 143(3) of the Act, based on our (iii) During the year, the company was not liable to
• a) We have sought and obtained all the information Protection Fund. and explanations which to the best of our For Satinder Goyal & Co. knowledge and belief were necessary for the Chartered Accountants purposes of our audit. Firm's Regn. No: 027334N

• b) In our opinion, proper books of accounts as required by law have been kept by the company S.K. Goyal so far as it appears from our examination of those books. Date : 4 May, 2019 (Partner)

• Materiality is the magnitude of misstatements in the c) The Balance Sheet, the Statement of Profit and Loss standalone financial statements that, individually or in (including other comprehensive income), Statement of aggregate, makes it probable that the economic Changes in Equity and the Statement of Cash Flows decisions of a reasonably knowledgeable user of the dealt with by this report are in agreement with the

• e) On the basis of the written representations received We communicate with those charged with governance st from the directors as on 31 March, 2019 taken on regarding, among other matters, the planned scope record by the Board of Directors, none of the directors is and timing of the audit and significant audit findings, st disqualified as on 31 March, 2019 from being including any significant deficiencies in internal appointed as a director in terms of section 164(2) of the control that we identify during our audit. Act.
• We also provide those charged with governance with a f) With respect to the adequacy of the internal financial statement that we have complied with relevant ethical controls over financial reporting of the company and requirements regarding independence and to the operating effectiveness of such controls, refer to our communicate with them all relationships and other separate report in "Annexure B". Our report expresses matters that may reasonably be thought to bear on our an unmodified opinion on the adequacy and operating independence and where applicable, related effectiveness of the Company's internal financial safeguards. controls over financial reporting.

therefore the key audit matters. We describe these In our opinion and to the best of our information and matters in our auditor's report unless law or regulation according to the explanations given to us, the precludes public disclosures about the matter or when, remuneration paid by the company to its directors in extremely rare circumstances, we determine that a during the year is in accordance with the provisions of

• reasonably be expected to outweigh the public interest Auditor's Report in accordance with Rule 11 of the benefits of such communication. Companies (Audit and Auditors) Rules, 2014, in our Report on Other Legal and Regulatory Requirements opinion and to the best of our information and

• extent applicable. contracts including derivate contracts.

• audit, we report that: transfer any amount to the Investor Education and

th

Place : New Delhi Membership No. : 084613

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date on the st standalone financial statements of Morepen Laboratories Limited for the year ended 31 March, 2019.)

• were noticed on physical verification. financial statements).
• (iv) According to the information and explanations given whether these are accurate and complete. to us and based on audit procedures performed, we are
• th Pradesh vide its Order dated 4 August, 2009 the Income Tax (TDS), Goods and Services Tax (GST). Company allotted 9,24,90,413 Equity Shares to the payable- the matter back to single judge for considering the representation of central government and deciding the matter afresh. The matter was later transferred to Hon'ble National Company Law Tribunal (NCLT), Chandigarh. The Hon'ble NCLT vide its judgment

th (i) (a) The Company has maintained proper records dated 12 March, 2018 dismissed the Company's petition showing full particulars, including quantitative seeking approval of the Scheme of arrangement with the details and situation of fixed assets Fixed Deposit holders. However, Hon'ble NCLT further stated that the order will not affect the allotment of the shares (b) According to the information and explanation to the FD holders who have traded the shares to the third given to us, the Company has a regular programe parties or transferred the allotted shares. It directed the of physical verification of its fixed assets. In our company that it shall pay the outstanding amount as per the opinion, the frequency of physical verification is scheme approved by the Company Law Board (CLB) to the reasonable having regard to the size and the original FD holders (except to those who have since nature of its assets. As, informed to us, the traded/transferred the shares allotted to them). The discrepancies noticed on such verification are Company had filed an appeal before the Hon'ble National not material and have been properly dealt with in Company Law Appellate Tribunal (NCLAT) at New Delhi the books of accounts. th against the order dated 12 March, 2018 of the Hon'ble (c) According to the information and explanations NCLT, Chandigarh. The Hon'ble NCLAT while issuing given to us and on the basis of our examination of notice to the respondents has stayed the operation of the th the books of accounts, the title deeds of impugned order dated 12 March, 2018. The Hon'ble immovable property are held in the name of the National Company Law Appellate Tribunal (NCLAT) after Company. hearing the matter has reserved the order for judgment. Pending disposal of the company's appeal before Hon'ble (ii) As explained to us, the inventories were physically NCLAT, the liability towards deposit holders, if any, is not verified during the year by the Management at ascertained. (Refer Note. No. 38(d) to the standalone reasonable intervals and no material discrepancies

• (vi) We have broadly reviewed the books of accounts (iii) According to the information and explanations given maintained by the company pursuant to the rules made by to us, the company has not granted any loans, secured the Central Government for the maintenance of cost records or unsecured, to companies, firms, limited liability under section 148(1) of the Act in respect of the company's partnerships or other parties covered in the register maintained under section 189 of the Companies Act, products to which the said rules are made applicable and that prima facie, the prescribed cost records have been made 2013(the "Act"). Hence provision of this clause is not and maintained. However we have not carried out detailed applicable. examination of the records with a view to determine
• (vii) (a) According to the information and explanations given to of the opinion that in respect of loans, investments, us and on the basis of our examination of the records of guarantees and security, the company has complied with the provisions of section 185 and 186 of the Act. the company, during the year, the company is regular in depositing amount deducted /accrued in respect of st (v) During the financial year ended 31 March, 2010, undisputed statutory dues including duty of custom, pursuant to a Scheme of Arrangement & Compromise duty of excise, cess with the appropriate authorities. under Section 391 of the Companies Act, 1956 However the company is not regular in depositing the approved by the Hon'ble High Court of Himachal dues of Employee's State Insurance, Provident fund,

According to the records and information and fixed deposit holders in settlement of their dues. On explanations given to us, the following statutory dues an appeal filed against the said Order by the Central st Government, the Hon'ble Division Bench of the were in arrears as on 31 March, 2019 for a period of Hon'ble High Court of Himachal Pradesh remanded more than six months from the date they became

Nature	Year	Outstanding since	Amount (`)
Fringe benefit tax	A.Y. 2009-10	31.03.2011	13,87,035

(b) According to the information provided to us, the following duties of excise have not been deposited by the company on account of disputes:

Name of the statute	Nature of dues	Amount (in `)	Period to which the amount relates	Forum where dispute is pending
Central Excise Act, 1944	Excise duty, Penalty, Interest	73,66,645	June 2004 to July 2008	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Penalty, Interest	76,12,753	June 2004 to March 2009	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Penalty, Interest	87,736	December 2008 to March 2009	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Penalty, Interest	13,97,264	April 2009 to March 2010	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Penalty, Interest	1,68,325	April 2009 to March 2010	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Penalty, Interest	2,10,949	April 2010 to September 2010	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Interest	7,64,251	April 2010 to December 2010	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Interest	28,17,881	January 2011 to June 2015	CESTAT-Chandigarh
Central Excise Act, 1944	Excise duty, Interest	14,06,727	July 2015 to June 2017	Commissioner of Appeal - Chandigarh

• (viii) According to the information and explanations given not applicable.
• way of initial public offer or further public offer applicable accounting standards.
• given to us, we have neither come across any instance the company.
• to us and on the basis of our verification of books of the Order are not applicable to the company. paid/provided for Managerial remuneration in 45-IA of the Reserve Bank of India Act, 1934. accordance with the requisite approvals mandated by For Satinder Goyal & Co. the provisions of section 197 of the Act read with Chartered Accountants Schedule V of the Act. Firm's Regn. No: 027334N

• (xii) In our opinion and according to information and S.K. Goyal explanations given to us, the company is not a Nidhi th Date : 4 May, 2019 (Partner) company. Accordingly, paragraph 3(xii) of the Order is

• to us by the management, the company has not (xiii) According to the information and explanations given to us defaulted in repayment of loans or interest to and based on our examination of the records of the Banks/FIs. company, transactions with the related parties are in (ix) According to the information and explanations given compliance with sections 177 & 188 of the Act where to us and based on our examination of the records of applicable and details of such transactions have been the company, the company did not raise any money by disclosed in the financial statements as required by the

• (including debt instruments) and/or term loan during (xiv) According to the information and explanations given to us the year. and based on our examination of the records of the (x) During the course of our examination of the books and company, the company has not made any preferential records of the company, carried out in accordance allotment or private placement of shares or convertible with the generally accepted auditing practices in India, debentures during the year under review. Accordingly, the and according to the information and explanations provision of clause 3(xiv) of the Order are not applicable to
• of fraud by the company or on the company by its (xv) According to the information and explanations given to us officers or employees, noticed or reported during the and based on our examination of the records of the year, nor have we been informed of any such case by company, the company has not entered into any non- cash the Management. transaction with directors or person connected with them (xi) According to the information and explanations given during the year. Accordingly, the provision of clause 3(xv) of
• accounts of the company, the company has (xvi) The company is not required to be registered under section

Place : New Delhi Membership No. : 084613

ANNEXURE "B" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 2(f) under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date on st the standalone financial statements of Morepen Laboratories for the year ended 31 March 2019)

Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the

Companies Act, 2013 ("the Act")

financial reporting of Morepen Laboratories Limited ("the financial reporting. st Company") as of 31 March, 2019 in conjunction with our Meaning of Internal Financial Controls over Financial Reporting

accuracy and completeness of the accounting records, and statements. required under the Act. Reporting

reasonable assurance about whether adequate internal deteriorate. financial controls over financial reporting was established Opinion

financial reporting included obtaining an understanding of control stated in the Guidance Note. internal financial controls over financial reporting, assessing For Satinder Goyal & Co. the risk that a material weakness exists, and testing and Chartered Accountants evaluating the design and operating effectiveness of internal Firm's Regn. No: 027334N control based on the assessed risk. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial S.K. Goyal th statements, whether due to fraud or error. Date : 4 May, 2019 (Partner)

We believe that the audit evidence we have obtained is Place : New Delhi Membership No. : 084613 sufficient and appropriate to provide a basis for our audit

We have audited the internal financial controls over opinion on the Company's internal financial controls system over

audit of the standalone financial statements of the Company A company's internal financial control over financial reporting is a for the year ended on that date. process designed to provide reasonable assurance regarding the Management's Responsibility for Internal Financial reliability of financial reporting and the preparation of financial Controls statements for external purposes in accordance with generally The Company's management is responsible for establishing accepted accounting principles. A company's internal financial and maintaining internal financial controls based on the control over financial reporting includes those policies and internal control over financial reporting criteria established procedures that (1) pertain to the maintenance of records that, in by the Company considering the essential components of reasonable detail, accurately and fairly reflect the transactions and internal control stated in the Guidance Note on Audit of dispositions of the assets of the company; (2) provide reasonable Internal Financial Controls over Financial Reporting issued assurance that transactions are recorded as necessary to permit by the Institute of Chartered Accountants of India (the preparation of financial statements in accordance with generally "Guidance Note"). These responsibilities include the design, accepted accounting principles and that receipts and expenditures implementation and maintenance of adequate internal of the company are being made only in accordance with financial controls that were operating effectively for ensuring authorizations of management and directors of the company; and the orderly and efficient conduct of its business, including (3) provide reasonable assurance regarding prevention or timely adherence to company's policies, the safeguarding of its detection of unauthorized acquisition, use, or disposition of the assets, the prevention and detection of frauds and errors, the company's assets that could have a material effect on the financial

the timely preparation of reliable financial information, as Limitations of Internal Financial Controls Over Financial

Auditors' Responsibility Because of the inherent limitations of internal financial controls Our responsibility is to express an opinion on the Company's over financial reporting, including the possibility of collusion or internal financial controls over financial reporting based on improper management, override of controls, material our audit. We conducted our audit in accordance with the misstatements due to error or fraud may occur and not be detected. Guidance Note and the Standards on Auditing prescribed Also, projections of any evaluation of the internal financial under section 143(10) of the Act, to the extent applicable to controls over financial reporting to future periods are subject to the an audit of internal financial control. Those Standards and risk that the internal financial control over financial reporting may the Guidance Note require that we comply with ethical become inadequate because of changes in conditions, or that the requirements and plan and perform the audit to obtain degree of compliance with the policies or procedures may

and maintained and if such controls operated effectively in In our opinion, the Company has, in all material respects, an all material respects. adequate internal financial controls system over financial Our audit involves performing procedures to obtain audit reporting and such internal financial controls over financial evidence about the adequacy of the internal financial reporting were operating effectively as at March 31, 2019, based controls system over financial reporting and their operating on the internal control over financial reporting criteria established effectiveness. Our audit of internal financial controls over by the Company considering the essential components of internal

Balance Sheet

st As at 31 March, 2019

				` ( in Lakhs)
			As at	As at
		Note No.	31.03.2019	31.03.2018
A	ASSETS
	1. NON-CURRENT ASSETS
	Property, Plant and Equipment	2	14542.65	17013.84
	Goodwill	2	0.56	1.12
	Other Intangible Assets	2	716.13	1195.24
	Financial Assets :
	Investments	3	11769.48	11769.48
	Loans Other Non-Current Assets	4 5	4.14 6573.16	2.05 6372.15
			33606.12	36353.88
	2. CURRENT ASSETS
	Inventories	6	9084.16	7394.46
	Financial Assets :
	Investments	7	2.25	21.78
	Trade Receivables	8	12196.49	11022.27
	Cash and Cash Equivalents	9	935.82	546.69
	Bank Balances other than Cash and Cash Equivalents	10	2261.71	23.38
	Loans	4	34.71	44.66
	Other Financial Assets	11	26.31	10.10
	Other Current Assets	12	3791.32	3647.42
			28332.77	22710.76
	Total		61938.89	59064.64
B	EQUITY AND LIABILITIES
	1. EQUITY
	Equity Share Capital	13	8995.86	8995.86
	Other Equity		18749.80	16060.26
			27745.66	25056.12
	2. NON - CURRENT LIABILITIES Financial Liabilties :
	Borrowings	14	179.15	269.69
	Other Financial Liabilities	15	146.39	172.39
	Provisions	16	1785.48	1345.30
			2111.02	1787.38
	3. CURRENT LIABILITIES
	Financial Liabilties :
	Borrowings	14	898.97	-
	Trade Payables	17	15707.84	16489.21
	Other Financial liabilities	18	14625.37	15238.75
	Other Current Liabilties	19	735.98	366.74
	Provisions	16	114.05	126.44
			32082.21	32221.14
	TOTAL		61938.89	59064.64
	SIGNIFICANT ACCOUNTING POLICIES	1
	NOTES ON FINANCIAL STATEMENTS	2-39

Partner Chief Financial Officer Company Secretary Membership No. 084613

Place : New Delhi th Date : 4 May, 2019

As per our separate report of even date For & on behalf of the Board of Directors of Morepen Laboratories Ltd.

For Satinder Goyal & Co. (Sushil Suri) (Manoj Joshi) Chartered Accountants Chairman & Managing Director Director Firm Regn. No. 027334N DIN : 00012028 DIN : 00036546

Statement of Profit and Loss

st For the Year Ended 31 March, 2019

			` ( in Lakhs )
		Year Ended	Year Ended
	Note No.	31.03.2019	31.03.2018
REVENUE
Revenue from Operations (Net)	21	71724.29	56083.04
Other Income	22	367.18	354.01
Total Income (I)		72091.47	56437.05
EXPENSES
Cost of Materials Consumed	23	34308.09	22052.65
Purchases of Stock-in-Trade	24	14274.29	11782.66
Changes in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade	25	(1946.01)	424.49
Employee Benefits Expense	26	8474.24	6821.90
Finance Costs	27	207.08	429.46
Depreciation and Amortization Expense	2	3800.78	3339.95
Other Expenses	28	10111.64	8974.42
Total Expenses (II)		69230.11	53825.53
Profit before Tax		2861.36	2611.52
Tax Expense
Tax		(212.70)	-
Tax Credit Entitlement		212.70	-
Profit for the Year (III)		2861.36	2611.52
Other Comprehensive Income
Items that will not be reclassified to Profit & Loss		(171.82)	10.95
Tax		37.03	-
Tax Credit Entitlement		(37.03)	-
Other Comprehensive Income for the Year (Net of Tax) (IV)		(171.82)	10.95
Total Comprehensive Income for the Year (III+IV)		2689.54	2622.47
Earning per equity share (Face Value of Rs. 2/- each)	34
(1) Basic		0.64	0.58
(2) Diluted		0.64	0.58
SIGNIFICANT ACCOUNTING POLICIES	1
NOTES ON FINANCIAL STATEMENTS	2-39
As per our separate report of even date	For & on behalf of the Board of Directors of Morepen Laboratories Ltd.
For Satinder Goyal & Co. Chartered Accountants Firm Regn. No. 027334N	(Sushil Suri) Chairman & Managing Director DIN : 00012028	(Manoj Joshi) Director DIN : 00036546
(CA S. K. Goyal) Partner Membership No. 084613	(Ajay Sharma) Chief Financial Officer		(Vipul Kumar Srivastava) Company Secretary

Place : New Delhi th Date : 4 May, 2019

Cash Flow Statement

st For the Year Ended 31 March, 2019

				` ( in Lakhs )
			Year Ended	Year Ended
		Note No.	31.03.2019	31.03.2018
A.	CASH FLOWS FROM OPERATING ACTIVITIES :
	Profit before Tax		2861.36	2611.52
	Adjustments for :
	Depreciation & Amortisation	2	3800.78	3339.95
	(Profit)/Loss on Sale of Property, Plant & Equipments		0.06	5.50
	Provision for Employee benefit		(171.82)	10.95
	Finance Cost	27	207.08	429.46
	Operating Profit before changes in Current Assets and Liabilities		6697.46	6397.38
	Changes in Current Assets and Liabilities -
	Trade Receivables	8	(1174.23)	(2712.30)
	Loans, Bank balance other than cash & Cash equivalent
	and other Current Assets	4,10,11,12	(2388.49)	(1413.91)
	Inventories	6	(1689.70)	(1144.77)
	Current Liabilities	16,17,18,19	12.84	4998.64
	Cash generated from Operations		1457.88	6125.04
	Tax Expense (Net)		-	-
	NET CASH GENERATED FROM OPERATING ACTIVITIES		1457.88	6125.04
B.	CASH FLOWS FROM INVESTING ACTIVITIES:
	Purchase of Property, Plant & Equipments	2	(849.97)	(1030.85)
	Purchase/Addition of Intangibles (Net)		(1.80)	(1397.14)
	Proceeds from Sale of Property, Plant & Equipments		1.80	1.58
	Sales/(Purchase) of Investments (Net)	7	19.53	(21.78)
	Investment in Other Non-Current Assets	4,5	(203.10)	20.66
	NET CASH USED IN INVESTING ACTIVITIES		(1033.54)	(2427.54)
C.	CASH FLOWS FROM FINANCING ACTIVITIES:
	Finance Cost	27	(207.08)	(429.46)
	Proceeds (Repayments) of Long Term Borrowings (Net)	14	(1141.28)	(3420.74)
	Proceeds (Repayments) of Short Term Borrowings (Net)	14	898.97	-
	Change in Other Non- Current Liabilities & Provisions (Net)	15,16	414.18	83.49
	NET CASH USED IN FINANCING ACTIVITIES		(35.21)	(3766.71)
	Net Increase/(Decrease) in Cash and Cash Equivalents (A+B+C)		389.13	(69.20)
	Cash and Cash Equivalents as at Begining of the Year		546.69	615.89
	Cash and Cash Equivalents as at End of the Year		935.82	546.69
	Bank Balances other than Cash and Cash Equivalents		2261.71	23.38
	SIGNIFICANT ACCOUNTING POLICIES	1
	NOTES ON FINANCIAL STATEMENTS	2-39

Partner Chief Financial Officer Company Secretary Membership No. 084613

Place : New Delhi th Date : 4 May, 2019

As per our separate report of even date For & on behalf of the Board of Directors of Morepen Laboratories Ltd.

For Satinder Goyal & Co. (Sushil Suri) (Manoj Joshi) Chartered Accountants Chairman & Managing Director Director Firm Regn. No. 027334N DIN : 00012028 DIN : 00036546

STATEMENT OF CHANGES IN EQUITY

st For the Year Ended 31 March, 2019

A. EQUITY SHARE CAPITAL

st	Change in equity share capital	st
Balance as at 1 April, 2018	during the year	Balance as at 31 March, 2019
8995.86	-	8995.86

B. OTHER EQUITY

th Date : 4 May, 2019

		RESERVES & SURPLUS
	Capital Reserve	Capital Redemption Reserve	Securities Premium	Retained Earnings	Other items of other comprehensive income	Total Other Equity
st Balance as at 1 April, 2018	270.40	7123.33	16740.51	(8023.25)	(50.73)	16060.26
Profit for the year	-	-	-	2861.36	-	2861.36
Other comprehensive income/(loss) for the year	-	-	-	-	(171.82)	(171.82)
Total comprehensive income/(loss) for the year	-	-	-	2,861.36	(171.82)	2689.54
st Balance as at 31 March, 2019	270.40	7123.33	16740.51	(5161.89)	(222.55)	18749.80

SIGNIFICANT ACCOUNTING POLICIES NOTES ON FINANCIAL STATEMENTS	1 2-39
As per our separate report of even date	For & on behalf of the Board of Directors of Morepen Laboratories Ltd.
For Satinder Goyal & Co. Chartered Accountants Firm Regn. No. 027334N	(Sushil Suri) Chairman & Managing Director DIN : 00012028	(Manoj Joshi) Director DIN : 00036546
(CA S. K. Goyal) Partner Membership No. 084613	(Ajay Sharma) Chief Financial Officer	(Vipul Kumar Srivastava) Company Secretary
Place : New Delhi

59 60

1. COMPANY OVERVIEW AND SIGNIFICANT ACCOUNTING POLICIES

impairments & others. Home Health products. The Company has its manufacturing locations situated in the state of Accounting estimates could change from period to Himachal Pradesh with trading and other incidental period. Actual results could differ from those and related activities extending to both domestic and estimates. Appropriate changes in estimates are made global markets. as management becomes aware of changes in

These financial statements are prepared in the period in which changes are made and, if accordance with the Indian Accounting Standards material, their effects are disclosed in the notes to (Ind AS) notified under the Companies (Indian financial statements. Accounting Standards) Rules, 2015 as amended by 1.3 Property, Plant and Equipment (PPE) the Companies (Indian Accounting Standards) (Amendment) Rules, 2016, the relevant provisions of The Company has elected to continue with the the Companies Act, 2013 ("the Act'') and guidelines carrying value of all its property, plant and equipment issued by the Securities and Exchange Board of India as recognized in the financial statements as at the date

th AS 101. meeting held on 04 May, 2019.

The financial statements are presented in Indian less accumulated depreciation. The initial cost of Rupees, which is the functional currency of the PPE comprises its purchase price, including Company and the currency of the primary economic import duties and non-refundable purchase

months for the purpose of classification of its assets incurred.

1.0 Company Overview with Ind AS requires the management of the company to make estimates, judgements and assumptions. Morepen Laboratories Limited ("the Company") is a These estimates, judgements and assumptions affect Public limited company incorporated and domiciled the application of accounting policies and the in India and has its listing on the BSE Limited and reported balances of assets and liabilities, disclosures National Stock Exchange of India Limited. The of contingent assets and liabilities as at the date of addresses of its registered office and principal place of financial statements and the reported amount of business are disclosed in the introduction to the revenues and expenses during the year. Examples of annual report. The Company is in the business of such estimates include provisions for doubtful debts, manufacturing, producing, developing and marketing employee benefits, provisions for income taxes, a wide range of Active Pharmaceutical Ingredients useful life of depreciable assets and provisions for (APIs), branded and generic formulations and also the

circumstances surrounding the estimates. Changes in 1.1 Basis for preparation of financial statements estimates are reflected in the financial statements in

(SEBI), as applicable. of transition to Ind AS, measured as per the previous GAAP and use that as the deemed cost as at the The financial statements are authorized for issue by transition date pursuant to the exemption under Ind the Board of Directors of the Company at their

• a) Free hold land is carried at cost. All other items of Functional and Presentation Currency Property, plant and equipment are stated at cost, environment in which the Company operates. taxes, and any directly attributable costs of Basis of measurement bringing an asset to working condition and location for its intended use, including relevant These financial statements are prepared under the borrowing costs and any expected significant historical cost convention unless otherwise indicated. costs of decommissioning, less accumulated Operating Cycle depreciation and accumulated impairment Based on the nature of products/activities of the losses, if any. Expenditure incurred after the PPE have been put into operation, such as repairs and company and normal time between acquisition of maintenance, are charged to the Statement of assets and their realisation in cash or cash equivalents, Profit and Loss in the period in which the costs are the company has determined its operating cycle as 12

• and liabilities as current and non-current. b) Advances paid towards the acquisition of 1.2 Use of Estimates and Judgements property, plant and equipment outstanding at each balance sheet date is classified as capital The presentation of financial statements in conformity advances under other non-current assets.

• c) Capital work-in-progress in respect of assets straight line basis, commencing from the date the which are not ready for their intended use are asset is available to the company for its use. The carried at cost, comprising of direct costs, related estimated useful life of an identifiable intangible

• method and useful lives are reviewed periodically are eliminated from the financial statements upon at end of each financial year. sale or retirement of the asset and the resultant gains or losses are recognized in the statement of 1.6 Valuation of inventories profit and loss. Assets to be disposed off are Stocks of raw materials and other ingredients have

raw material cost up to the stage of completion, as Development expenditure

Expenditure pertaining to research is expensed as Goods in transit are carried at cost. incurred. Expenditure incurred on development is 1.7 Foreign Currency Transactions / Translations capitalised if such expenditure leads to creation of an asset and/or benefits are expected over more than one i) Transactions denominated in foreign currency period, otherwise such expenditure is charged to the are recorded at exchange rates prevailing at the Statement of Profit and Loss. date of transaction or at rates that closely

approximate the rate at the date of the transaction. Expenditure providing benefits for more than one period is amortised proportionately over the periods ii) Monetary assets and liabilities denominated in during which benefits are expected to occur. foreign currencies at the reporting date are

Intangible assets with finite useful lives that are monetary assets and liabilities that are measured acquired separately are carried at cost less based on historical cost in a foreign currency are accumulated amortisation and accumulated translated at the exchange rate at the date of the impairment, if any. The Company determines the transaction. amortisation period as the period over which the iii) Exchange differences on monetary items are future economic benefits will flow to the Company recognised in the Statement of Profit and Loss in after taking into account all relevant facts and the period in which they arise except for circumstances. The estimated useful life and exchange differences on foreign currency amortisation method are reviewed periodically, with borrowings relating to assets under construction the effect of any changes in estimate being accounted

Depreciation is the systematic allocation of the currency borrowings. depreciable amount of PPE over its useful life and is iv) Foreign exchange differences recorded as an provided on a straight-line basis over the useful lives adjustment to borrowing costs are presented in as prescribed in Schedule II to the Act or as per the statement of profit and loss, as a part of

• a) Depreciation on fixed assets is provided on losses are presented in the statement of profit and straight-line method at the rates prescribed by the loss on net basis. schedule II of the Companies Act, 2013 and in the v) In case of long term monetary items outstanding

incidental expenses and attributable interest. asset is based on a number of factors including the effects of obsolescence, etc. The amortization d) The cost and related accumulated depreciation

reported at the lower of the carrying value or the been valued on First in First Out (FIFO) basis, at cost or fair value less cost to sell. net realizable value whichever is less, finished goods 1.4 Intangible Assets and Amortisation and stock-in-trade have been valued at lower of cost and net realizable value, work-in-progress is valued at Internally generated Intangible Assets - Research and certified by the management on technical basis.

• translated into the functional currency at the Intangible Assets acquired separately exchange rate at the reporting date. Non-
• for future productive use, which are included in for on a prospective basis. the cost of those assets when they are regarded as 1.5 Depreciation an adjustment to interest costs on those foreign
• technical assessment. finance cost. All other foreign exchange gains and
• manner as prescribed by it except assets costing as at the end of year, exchange differences arising less than Rs. 5000/- on which depreciation is on settlement / restatement thereof are capitalised charged in full during the year. as part of the depreciable fixed assets to which the b) Intangible assets are amortized over their monetary item relates and depreciated over the respective individual estimated useful life on remaining useful life of such assets. If such

monetary items do not relate to acquisition of flows and the contractual terms of the depreciable fixed assets, the exchange difference financial asset give rise on specified dates to is amortised over the maturity period / up to the cash flows that are solely payments of date of settlement of such monetary items, principal and interest on the principal whichever is earlier, and charged to the amount outstanding.

Final dividends on shares are recorded as a liability on A financial asset is subsequently measured the date of approval by the shareholders and interim at fair value through other comprehensive dividends are recorded as a liability on the date of income if it is held within a business model declaration by the company's Board of Directors. whose objective is achieved by both

Leases under which the company assumes the financial asset give rise on specified substantially all the risks and rewards of ownership dates to cash flows that are solely payments are classified as finance leases. When acquired, such of principal and interest on the principal assets are capitalized at fair value or present value of amount outstanding. minimum lease payments at the inception of lease, c) Financial assets at fair value through profit whichever is lower. Lease under which the risks and or loss (FVTPL) rewards incidental to ownership are not transferred to lessee, is classified as operating lease. Lease payments A financial asset is measured at fair value under operating leases are recognized as an expense through profit and loss unless it is measured on a straight line basis in net profit in the statement of at amortized cost or at fair value through profit and loss over the lease term. other comprehensive income.

and associates A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability The Company has adopted to measure or equity instrument of another entity. investments in subsidiaries, joint ventures

Ind AS 27 and carrying amount as per when a Company becomes a party to the contractual previous GAAP at the date of transition has provisions of the instruments.

i) Initial Recognition and measurement accordance with Ind AS 101.

On initial recognition, all the financial assets and e) Financial liabilities liabilities are recognized at its fair value plus or Financial liabilities are classified as either minus transaction costs that are directly financial liabilities at FVTPL or 'other attributable to the acquisition or issue of the financial liabilities'. financial asset or financial liability except financial asset or financial liability measured at Financial liabilities at FVTPL fair value through profit or loss ("FVTPL"). Financial liabilities are classified as at FVTPL Transaction costs of financial assets and liabilities when the financial liability is held for carried at fair value through the Profit and Loss are trading or are designated upon initial immediately recognized in the Statement of Profit recognition as FVTPL. Gains or Losses on

ii) Subsequent measurement the Statement of Profit and Loss.

a) Financial assets carried at amortised cost Other Financial liabilities

A financial asset is subsequently measured Other financial liabilities (including at amortised cost if it is held within a borrowings and trade and other payables) business model whose objective is to hold are subsequently measured at amortised the asset in order to collect contractual cash cost using the effective interest method.

Statement of Profit and Loss. b) Financial assets at fair value through other 1.8 Dividends comprehensive income (FVTOCI)

collecting contractual cash flows and selling 1.9 Leases financial assets and the contractual terms of

2.0 Financial Instruments d) Investments in subsidiaries, joint ventures

and associates at cost in accordance with Financial assets and financial liabilities are recognised been considered as deemed cost in

and Loss. liabilities held for trading are recognised in

For trade and other payables maturing ii) Non-Financial Assets within one year from the balance sheet date, The carrying amounts of the Company's tangible

impairment loss, if any. rights to the cash flows from the financial asset expire or it transfers the financial asset and the transfer The impairment loss is recognised as an expense qualifies for derecognition under Ind AS 109. A in the Statement of Profit and Loss, unless the financial liability is derecognized when the obligation asset is carried at revalued amount, in which case specified in the contract is discharged or cancelled or any impairment loss of the revalued asset is expired. treated as a revaluation decrease to the extent a

revaluation reserve is available for that asset. iv) Fair value measurement of financial instruments

selling price and their value in use. Value in use is using the valuation techniques that are appropriate in arrived at by discounting the future cash flows to the circumstances and for which sufficient data are their present value based on an appropriate available to measure fair value, maximising the use of discount factor. relevant observable inputs and minimising the use of unobservable inputs. When there is indication that an impairment loss

asset) in earlier accounting periods no longer methods used to determine the fair value of financial exists or may have decreased, such reversal of assets and liabilities include quoted market price, impairment loss is recognised in the Statement of discounted cash flow analysis and valuation certified Profit and Loss, to the extent the amount was by the external valuer.

In case of financial instruments where the carrying Loss. In case of revalued assets, such reversal is amount approximates fair value due to the short not recognised. maturity of those instruments, carrying amount is 2.2 Revenue Recognition considered as fair value.

In accordance with Ind AS 109, the company a) Revenue is recognised at the fair value of the

Loss allowance for trade receivables with no Provisions for rebates, discount and return are significant financing component is measured at estimated and provided for in the year of sales and an amount equal to lifetime ECL. For all other recorded as reduction of revenue. financial assets, expected credit losses are to receive the income is established. ECL, unless there has been a significant increase in credit risk from initial recognition in which 2.3 Interest reporting date to the amount that is required to be be measured reliably. recognised is recognized as an impairment gain

the carrying amounts approximate fair value and intangible assets are reviewed at each due to the short maturity of these reporting date to determine whether there is any instruments. indication of impairment. If any such indication iii) Derecognition of financial instruments exists, then the asset's recoverable amount is estimated in order to determine the extent of the A financial asset is derecognized when the contractual

The recoverable amount is the greater of the net The fair value of financial instruments is determined

recognised for an asset (other than a revalued Based on the three level fair value hierarchy, the previously charged to the Statement of Profit and

Revenue is recognized to the extent that it is probable 2.1 Impairment of Assets that the economic benefits will flow to the Company i) Financial Assets and the amount can be reliably measured.

recognizes loss allowances using the expected consideration received or receivable. The credit loss (ECL) model for the financial assets amount disclosed as revenue is net of returns, which are not fair valued through profit or loss. trade discounts, Goods and Services Tax (GST).

b) Dividend income is accounted for when the right measured at an amount equal to the 12-month

case those are measured at lifetime ECL. The Interest income from a financial asset is recognized amount of expected credit losses (or reversal) that when it is probable that the economic benefits will is required to adjust the loss allowance at the flow to the company and the amount of income can

Income from interest is recognized using the effective or loss in statement of profit or loss. interest rate (EIR). EIR is the rate that exactly discounts

the estimated future cash payments or receipts over Minimum Alternate Tax credit is recognised as the expected life of the financial instrument or a deferred tax asset only when and to the extent there is shorter period, where appropriate, to the gross convincing evidence that the Company will pay carrying amount of the financial asset. When normal income tax during the specified period. Such calculating the effective interest rate, the Company asset is reviewed at each Balance Sheet date and the estimates the expected cash flows by considering all carrying amount of the MAT credit asset is written the contractual terms of the financial instrument but down to the extent there is no longer a convincing

2.5 Borrowing Costs Income tax expense comprises current tax and

costs. and tax laws that have been enacted or substantively offsets current tax assets and current tax liabilities, assets where it has a legally enforceable right to set off the Provisions are recognised when the Company has a recognized amounts and where it intends either to present obligation (legal or constructive) as a result of settle on a net basis, or to realize the asset and settle a past event and it is probable that an outflow of

Deferred income tax assets and liabilities are required to settle such an obligation. recognized for all temporary differences arising If the effect of the time value of money is material, carrying amounts in the financial statements except expected future cash flows to net present value using when the deferred income tax arises from the initial an appropriate pre-tax discount rate that reflects recognition of an asset or liability in a transaction that current market assessments of the time value of is not a business combination and affects neither money and where appropriate, the risks specific to the accounting nor taxable profit or loss at the time of the liability. Unwinding of the discount is recognised in transaction. Deferred tax assets and liabilities are the Statement of Profit and Loss as a finance cost. reviewed at each reporting date and are reduced to Provisions are reviewed at each reporting date and are the extent that it is no longer probable that the related adjusted to reflect the current best estimate. tax benefit will be realized.

Deferred income tax assets and liabilities are it is either not probable that an outflow of resources measured using tax rates and tax laws that have been will be required to settle or a reliable estimate of the enacted or substantively enacted by the balance sheet amount cannot be made, is disclosed as a contingent date and are expected to apply to taxable income in liability. Contingent liabilities are also disclosed when the years in which those temporary differences are there is a possible obligation arising from past events, expected to be recovered or settled. The effect of the existence of which will be confirmed only by the changes in tax rates on deferred income tax assets and occurrence or non-occurrence of one or more liabilities is recognized as income or expense in the uncertain future events not wholly within the control period that includes the enactment or the substantive of the Company. enactment date. A deferred income tax asset is Claims against the Company where the possibility of recognized to the extent that it is probable that future any outflow of resources in settlement is remote, are taxable profit will be available against which the not disclosed as contingent liabilities. deductible temporary differences and tax losses can

does not consider the expected credit losses. evidence to the effect that the Company will pay normal income tax during the specified period. 2.4 Income Taxes

deferred tax. Income tax expense is recognized in net Borrowing costs that are directly attributable to the profit in the statement of profit and loss except to the acquisition, construction or production of a qualifying extent that it relates to items recognized directly in asset are capitalized as part of the cost of the asset. equity or other comprehensive income, in which case Other borrowing costs are recognized as an expense it is also recognized in equity or other comprehensive in the period in which they are incurred. Borrowing income respectively. costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Current income tax for current and prior periods is Borrowing cost also includes exchange differences to recognized at the amount expected to be paid to or the extent regarded as an adjustment to the borrowing recovered from the tax authorities, using the tax rates

enacted by the balance sheet date. The Company 2.6 Provisions, contingent liabilities and contingent

the liability simultaneously. resources, that can be reliably estimated, will be

between the tax base of assets and liabilities and their provisions are determined by discounting the

A present obligation that arises from past events where

be utilized. Contingent assets are not recognised in financial

statements since this may result in the recognition of Defined benefit plans – income that may never be realised. However, when Gratuity the realisation of income is virtually certain, then the The company has an obligation towards gratuity, related asset is not a contingent asset and is a defined benefit retirement plan covering recognised.

Basic earning per share is calculated by dividing the employees at retirement, death, incapacitation net profit or loss for the year attributable to the equity while in employment or on termination of shareholders (after deducting preference dividends employment of an amount based on the and attributable taxes) by the weighted average respective employee's salary and tenure of number of equity shares outstanding during the year. employment. Vesting occurs upon completion of

five years of service. For the purpose of calculating the diluted earnings per share, the net profit or loss for the period attributable Liabilities with regard to the Gratuity Plan are to equity shareholders and the weighted average determined by actuarial valuation, performed by number of shares outstanding during the period are an independent actuary, at each balance sheet adjusted for the effects of all dilutive potential equity date using the projected unit credit method. Reshares. The dilutive potential equity shares are measurements comprising of actuarial gains and deemed converted as at beginning of the period, losses, are recognised in other comprehensive unless they have been issued at a later date. income which are not reclassified to profit or loss

in the subsequent periods. 2.8 Employee Retirement benefits

iii) Long – term employee benefits i) Short term employee benefits

Leave Encashment All employee benefits payable/available within twelve months of rendering the service are The liability of accumulating compensated classified as short term employee benefits. absences is determined by actuarial valuation Benefits such as salaries, wages and bonus etc., performed by an independent actuary at each are recognised in the statement of profit and loss balance sheet date using projected unit credit in the period in which the employee renders the method. related service. 2.9 Segment Reporting

Retirement benefits in the form of provident fund 3.0 Cash and cash equivalents is a defined contribution scheme. The company Cash and cash equivalents in the Balance Sheet entitling them to the contributions. term cash commitments.

eligible employees. The Gratuity payment plan 2.7 Earning per share provides for a lump sum payment to the vested

ii) Post – employment benefits The company operates in one reportable business Defined contribution plans – segment i.e. "Pharmaceuticals".

has no obligation, other than the contribution comprise cash at bank and in hand and short-term payable to the provident fund. Payments to deposits with banks that are readily convertible into defined contribution plans are recognised as an cash which are subject to insignificant risk of changes expense when employees have rendered service in value and are held for the purpose of meeting short-

st NOTES ON FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH, 2019

TANGIBLE ASSETS

î,
Í

										) Lakhs in ` (
			GROSS BLOCK			DEPRECIATI	MORTIZATI ON/A	ON	CARRYING VALUE
PARTICULARS	As at	Additions	(Disposals)/	As at	As at	For the	Deductions/	As at	As at	As at
	01.04.2018		Adjustments	31.03.2019	01.04.2018	year	Adjustments	31.03.2019	31.03.2019	31.03.2018
Land	143.03	-	-	143.03	-	-	-	-	143.03	143.03
Buildings	7385.97	64.06	-	7450.03	3296.03	178.83	-	3474.86	3975.17	4089.94
Machinery Plant &	78766.73	710.56	(12150.61)*	67326.68	66555.80	3032.32	(12150.61)	57437.51	9889.17	12210.93
Furnitures & Fixtures	285.08	29.20	-	314.28	246.88	5.68	-	252.56	61.72	38.20
Vehicles	665.98	2.92	(17.32)	651.58	211.41	68.73	(15.46)	264.68	386.90	454.57
Office Equipments	238.93	43.23	-	282.16	161.76	33.74	-	195.50	86.66	77.17
Total	87485.72	849.97	(12167.93)	76167.76	70471.88	3319.30	(12166.07)	61625.11	14542.65	17013.84
Previous Year	92078.51	1030.85	(5623.64)	87485.72	72993.78	3094.66	(5616.56)	70471.88	17013.84	-
WILL OOD II) G
Goodwill	2.80	-	-	2.80	1.68	0.56	-	2.24	0.56	1.12
Total	2.80	-	-	2.80	1.68	0.56	-	2.24	0.56	1.12
Previous Year	2.80	-	-	2.80	1.12	0.56	-	1.68	1.12
III) OTHER INTANGIBLE ASSETS
Computer Software	196.45	1.80	-	198.25	121.61	27.08	-	148.69	49.57	74.84
Acquisition Cost Customer	1345.05	-	-	1345.05	224.65	453.84	-	678.49	666.56	1120.40
Total	1541.50	1.80	-	1543.30	346.26	480.92	-	827.18	716.13	1195.24
Previous Year	144.36	1397.14	-	1541.50	101.53	244.73	-	346.26	1195.24	-
GRAND TOTAL
Current year	89030.02	851.77	(12167.93)	77713.87	70819.82	3800.78	(12166.07)	62454.53	15259.34	18210.20
Previous Year	92225.67	2427.99	(5623.64)	89030.02	73096.43	3339.95	(5616.56)	70819.82	18210.20
Note : 1) Customer Acquisition Cost represents amount spent for the expansion of product market and increase in customer reach.

2) * Old machinery no longer in use, depreciated and written off during the year.

		` ( in Lakhs )
	As at	As at
	31.03.2019	31.03.2018
3. INVESTMENTS (NON-CURRENT)
Trade Investments (At Cost)
Investment in Equity Instruments (Unquoted)
Subsidiary Companies
i) Dr. Morepen Limited
4,06,79,500 (Previous Year 4,06,79,500) Equity shares of Rs.10/- each fully paid up	11747.25	11747.25
ii) Morepen Inc.
9,400 (Previous Year 9,400) fully paid Shares
of Common Voting Stocks	22.23	22.23
	11769.48	11769.48
Aggregate amount of unquoted investments (At Cost)	11769.48	11769.48
Aggregate amount of provision for fall in carrying value of investments	-	-
Provision for fall in carrying value of investments, in respect of losses in the subsidiaries has not been made, as these losses, in management's perception, are temporary in nature.

4. LOANS

	Current Portion		Non Current Portion
	As at 31.03.19	As at 31.03.18	As at 31.03.19	As at 31.03.18
Unsecured
(Considred good)
Financial Assets at amortised cost
Loans to Employees	34.71	44.66	4.14	2.05
	34.71	44.66	4.14	2.05

5. OTHER NON CURRENT ASSETS

Unsecured
Capital Advances (Considered good) *	5790.08	5790.08
Leasehold Land Prepayments	25.34	25.70
Prepaid (Deffered)Expenses for Employee Benefit	2.57	1.16
Security Deposits	203.27	186.35
Due from Income Tax Department	551.90	368.86
	6573.16	6372.15

Includes-*

5771.27 Lakhs (Previous year 5771.27 Lakhs) advanced for the acquisition/

new business opportunity and buyout of new brands. The company expects to complete the transaction in the year's time.

6. INVENTORIES
Raw Materials	3747.92	4005.01
Work-in-progress	2192.57	1450.72
Finished goods	1839.68	727.11
Stock -in-trade	1131.55	1035.01
Goods in transit	2.83	2.05
Stores and spares	169.61	174.56
	9084.16	7394.46

		` ( in Lakhs )
	As at	As at
	31.03.2019	31.03.2018
The inventory of stocks, stores and spares has been taken,
valued and certified by the management.
Breakup of Inventory
i) Raw materials -
API & Intermediates	2553.86	2479.65
Home Health	521.57	823.56
Formulations	672.49	701.80
Total Raw Materials	3747.92	4005.01
ii) Work in Progress -
API & Intermediates	1851.60	1239.16
Home Health	266.48	113.83
Formulations -
Tablets	53.11	87.86
Syrup	1.54	1.17
Capsules	16.04	7.19
Others	3.80	1.51
Formulations Sub Total	74.49	97.73
Total Work -in -progress	2192.57	1450.72
iii) Finished goods -
API & Intermediates	973.69	434.95
Home Health	798.93	151.05
Formulations -
Tablets	36.01	118.48
Syrup	4.14	13.90
Capsules	4.38	7.76
Others	22.53	0.97
Formulations Sub Total	67.06	141.11
Finished Goods Inventory	1839.68	727.11
iv) Stock-in-trade -
Home Health	988.82	833.84
Formulations
Tablets	85.97	80.96
Syrup	42.61	46.19
Capsules	7.00	21.22
Others	7.15	52.80
Formulations Sub -total	142.73	201.17
Stock-in-trade Inventory	1131.55	1035.01
7. INVESTMENTS
Other Investments (At Cost)
Investment in Mutual Funds (Quoted)
Nil (Previous Year : 21000 Units) of Rs.100/- each of
ICICI Prudential Saving Fund-Daily Dividend	-	21.68
Nil (Previous Year 100 Units ) of Rs.100/- each of
ICICI Prudential Money Market Fund-Daily Dividend	-	0.10
69

		(` in Lakhs)
	As at	As at
	31.03.2019	31.03.2018
37 Units (Previous Year : Nil) of Aditya Birla Sun Life Equity Fund	0.25	-
120 Units (Previous Year : Nil) of Aditya Birla Sun Life Frontline Equity Fund	0.25	-
640 Units (Previous Year : Nil) of ICICI Prudential Bluechip Fund	0.25	-
758 Units (Previous Year : Nil) of Kotak Standard Multicap Fund	0.25	-
134 Units (Previous Year : Nil) of Franklin India Prima Fund	1.25	-
	2.25	21.78
Market Value of Quoted Investments	2.39	21.78
8. TRADE RECEIVABLES
Unsecured - Considered good	12196.49	11022.27
Considered Doubtful	81.99	96.28
Less : Provision for doubtful debts	(81.99)	(96.28)
	12196.49	11022.27
9. CASH AND CASH EQUIVALENTS
Balances with banks
Current Accounts	926.28	534.97
Cash in hand	9.54	11.72
	935.82	546.69
10. BANK BALANCES OTHER THAN CASH AND CASH EQUIVALENTS
Earmarked balances with banks
Margin Money & Security against Overdraft, Bills discounting
and LC facilities (Refer Note No. 14)	2229.06	11.82
Guarantees	32.65	11.56
	2261.71	23.38
11. OTHER FINANCIAL ASSETS
Interest accrued but not due	26.31	10.10
	26.31	10.10
12. OTHER CURRENT ASSETS
Unsecured considered good, unless otherwise stated
Advances with Suppliers & Others	1744.30	1568.99
Leasehold Land Prepayments	0.36	0.36
Balance with Government Authorities	1156.45	1431.64
Security Deposits	77.10	23.64
Export Incentives Receivable	668.63	403.87
Recoverable from Customs	-	61.47
Advances to Employees	67.56	83.89
Prepaid Expenses	76.92	73.56
	3791.32	3647.42
Advances Considered Doubtful	157.73	157.73
Less : Provision for doubtful advances	(157.73)	(157.73)
	3791.32	3647.42

13. SHARE CAPITAL

A. Equity Share Capital

		As at March 31, 2019	As at March 31, 2018
	No. of Shares	Amount ( /Lakhs) | No.<br>of Shares | Amount<br>(/Lakhs)
Authorised
Equity Shares of ` 2/- each	450000000	9000.00	450000000	9000.00
Issued and Subscribed
Equity Shares of ` 2/- each	449826203	8996.53	449826203	8996.53
(33000 Shares not paid up)
Paid up
Equity Shares of ` 2/- each	449826203	8995.86	449826203	8995.86
Reconcilation of the numbers and amount of Equity shares -
For the year ended		As at March 31, 2019		As at March 31, 2018

| | No.
of Shares | Amount
( /Lakhs) | No.<br>of Shares | Amount<br>(/Lakhs) |
|-------------------------------------------|------------------|----------------------|------------------|----------------------|
| Outstanding at beginning of the year | 449826203 | 8995.86 | 449826203 | 8995.86 |
| Add : Shares issued during the year | - | - | - | - |
| Less : Shares bought back during the year | - | - | - | - |
| Outstanding at the end of year | 449826203 | 8995.86 | 449826203 | 8995.86 |

B. Shareholders holding more than 5% shares -

Equity Shares

Name of Shareholder	As at March 31, 2019		As at March 31, 2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Pinfold Overseas Ltd.	38530000	8.57	38530000	8.57

C. Rights, preferences and restrictions attached to each class of Shares and terms of redemption -

• i) The company has equity shares having a par value of ` 2/- each. Every member of the Company holding equity shares shall be entitled to vote on every resolution placed before the Company and their voting right on poll shall be in proportion to their share in the paid-up equity share capital of the Company.
• ii) In the event of liquidation of the company, the holders of equity shares will be entitled to receive the remaining assets of the company after distribution of preferential amounts. The distribution will be in the proportion of the number of equity shares held by the shareholders.
• D. During last 5 years immediately preeceding the balance sheet date, no Equity Share has been issued pursuant to any contract without payment being received in cash. Further the company has neither allotted any share by way of bonus shares, nor it had bought back any Equity during aforesaid period of 5 years.

E. Disclosure about unpaid calls -
Unpaid Calls	31.03.2019	31.03.2018
By Directors & Officers	-	-
By Others	0.66	0.66

F. No shares have been forfeited by the company during the year.

146.39 172.39

14. BORROWINGS

Long Term

Long Term				(` in Lakhs)
	Current Portion		Non Current Portion
	As at 31.03.19	As at 31.03.18	As at 31.03.19	As at 31.03.18
Secured
Term Loans from Banks & Institutions
- Restructured Debts	-	1053.95	-	-
- Other Loans	91.24	88.03	179.15	269.69
	91.24	1141.98	179.15	269.69
Unsecured
- Preference Shares (Refer note no. 18)	11965.20	11965.20	-	-
	11965.20	11965.20	-	-
Total	12056.44	13107.18	179.15	269.69

I. Term Loans from Banks & Institutions

Other loans represent vehicle loans, repayble on monthly basis, are secured by way of hypothecation of specific assets purchased under the hire purchase scheme.

Year of Repayment	2020-21	2021-22	2022-23	Total
Annual Repayment Amount (Rs./Lakhs)	96.12	48.35	34.68	179.15
Annual Rate of Interest (%)	8.17-10.95	8.17-10.95	8.17-10.95
				(` in Lakhs)
			As at	As at
			31.03.2019	31.03.2018

II. Current Portion of Long Term Borrowings is appearing under the head Other Financial Liabilities. (Refer Note No. 18)

Short Term

Secured

	Bank Overdraft and Bill Discounting facility against term deposit (Refer Note No. 10)	898.97	-
	Total	898.97	-
	Annual rate of interest chargable on aforesaid facilties ranges up to 8.5 % .
15.	OTHER FINANCIAL LIABILITIES (NON-CURRENT)
	Security Deposits from Business Associates & Others	146.39	172.39

16. PROVISIONS

	CURRENT		NON-CURRENT
	As at 31.03.19	As at 31.03.18	As at 31.03.19	As at 31.03.18
Provision for Employees' Benefits (Unfunded) -
Gratuity	85.97	74.34	1336.43	1029.84
Leave Encashment	28.08	52.10	449.05	315.46
Total	114.05	126.44	1785.48	1345.30

		(` in Lakhs)
	As at	As at
	31.03.2019	31.03.2018
17. TRADE PAYABLES
Total outstanding dues of micro small and medium enterprises	268.60	38.88
Total outstanding dues of creditors other than micro small
and medium enterprises	15439.24	16450.33
	15707.84	16489.21
No interest during the year has been paid or payable under the terms of the MSMED Act, 2006.
18. OTHER FINANCIAL LIABILITIES -CURRENT
Current maturities of Long Term Borrowings (Refer note no. 14)	91.24	1141.98
Preference Shares (Refer note no.14)	11965.20	11965.20
Interest Accrued and Due on Borrowings	-	65.12
Cummulative Dividend on Preference Shares	881.32	831.69
Accrued Salaries and Benefits	977.53	754.12
Others	710.08	480.64
	14625.37	15238.75

Under the previous GAAP, Preference Shares Capital was treated as part of equity and carried at cost. Redeemable preference shares contain a contractual obligation to deliver cash to the holders. Under Ind AS the same is classified as liability. Dividend on cumulative preference shares has accordingly been shown as part of finance cost.

A. Preference Shares

	As at March 31, 2019		As at March 31, 2018
	No. of Shares	Amount (/Lakhs) | No.<br>of Shares | Amount<br>(/Lakhs)
Authorised Preference Shares of ` 100/- each	12000000	12000.00	12000000	12000.00
Issued , Subscribed & paid up Preference Shares of ` 100/- each	11965201	11965.20	11965201	11965.20
0.01% Optionally Convertible	9735201	9735.20	9735201	9735.20
0.01% Cumulative Redeemable	1730000	1730.00	1730000	1730.00
9.75% Cumulative Redeemable	500000	500.00	500000	500.00
	11965201	11965.20	11965201	11965.20

Reconcilation of the numbers and amount of Preference shares

		As at March 31, 2019		As at March 31, 2018
	No. of Shares	Amount (/Lakhs) | No.<br>of Shares | Amount<br>(/Lakhs)
Outstanding at beginning of the year Add : Shares issued during the year Less : Shares bought back/redeemed during the year	11965201 - -	11965.20 - -	11965201 - -	11965.20 - -
Outstanding at the end of year	11965201	11965.20	11965201	11965.20

B. Rights, preferences and restrictions attached to each class of Shares and terms of redemption -

• i) The company has preference shares of `100/- each. Every member of the Company holding preference shares shall be entitled to vote on resolutions placed before the Company which directly affect the rights attached to their shares and any resolution for winding up of the Company or for repayment or reduction of capital and their voting right on poll shall be in proportion to their share in the paid-up preference share capital of the Company. However, where the dividend in respect of a class of preference shares has not been paid for a period of two years or more, such class of preference shareholders shall have a right to vote on all resolutions placed before the Company and the proportion of voting rights of equity shareholders to the voting rights of preference shareholders shall be in proportion to their paid up capital.
• ii) All 9735201, 0.01% Optionally Convertible Preference Shares, had already become due for redemption/conversion in the financial year 2014-15 and could not be redeemed due to unavailibility of surplus.
• iii) Out of 1730000, 0.01% Cumulative Reedemable Preference Shares, preference shares comprising of 200000 Shares amounting to 200.00 Lakhs were due for redemption in financial year ending 31.03.2012, whereas 50% of 1530000 st Shares amounting to 765.00 Lakhs were due for redemption in the financial year ending 31 March, 2017 and balance st 50% had fallen due for redemption in the financial year ending 31 March, 2018.
• iv) 500000, 9.75% Cumulative redeemable Preference shares amounting to ` 500.00 Lakhs had been due for redemption since March 2004, however, could not be redeemed because of unavailability of surplus. The subscriber has filed a legal case against the company for the recovery of the sum invested as well as dividend thereon. The company is contesting the claim of the subscriber at appropriate forum.
• v) During the year, the company could not redeem the Preference Shares, already due for redemption, on account of unavailability of distributable profits in terms of Section 55(2)(a) and Section 123 of Companies Act, 2013.

C. Shareholders holding more than 5% shares -

Name of Shareholder	As at 31.03.2019		As at 31.03.2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Bank of Nova Scotia	1179000	12.11	1179000	12.11
Stressed Assets Stabilisation Fund (SASF)	961044	9.87	961044	9.87
EXIM Bank Ltd.	916333	9.41	916333	9.41
SICOM Ltd.	829463	8.52	829463	8.52
Punjab National Bank	671522	6.90	671522	6.90
Oriental Bank of Commerce	623828	6.41	623828	6.41
Dena Bank	593936	6.10	593936	6.10
UCO Bank	515900	5.30	515900	5.30

a) 9735201, 0.01% Optionally Convertible Redeemable Shares -

b) 1730000, 0.01% Cummulative Redeemable Shares -

Name of Shareholder	As at 31.03.2019		As at 31.03.2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Oriental Bank of Commerce	1000000	57.80	1000000	57.80
Axis Bank Ltd.	500000	28.90	500000	28.90
Blue Sky Securities Pvt. Ltd.	200000	11.56	200000	11.56

c) 500000, 9.75% Cumulative Redeemable Shares -

Name of Shareholder	As at 31.03.2019		As at 31.03.2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Jammu and Kashmir Bank Ltd.	500000	100	500000	100

		(` in Lakhs)
	As at	As at
	31.03.2019	31.03.2018
OTHER CURRENT LIABILITIES Advance received from Customers	239.89	271.13
Direct Taxes	292.77	58.99
Indirect Taxes	203.32	36.62
	735.98	366.74
CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)
a) Contingent Liabilties
Claims against the Company not acknowledged as debts	218.33	844.50
Guarantees	32.65	22.69
Other money for which company is contingently liable	901.50	1740.00
Fixed Deposits (Refer Note No. 38(d))	-
	1152.48	2,607.19
b) Commitments	-
	1152.48	2607.19
		(` in Lakhs)
	Year Ended	Year Ended
	31.03.2019	31.03.2018
REVENUE FROM OPERATIONS
Sale of products
Domestic	40900.75	36928.36
Exports	29696.46	18366.31
[(includes third party & deemed exports of Rs. 3.50 Lakhs (Previous year Rs. 2901.25 Lakh)]
Total	70597.21	55294.67
Other Operating Revenues
Export Incentives Other items	1093.59 33.49	777.32 11.05
	1127.08	788.37
	71724.29	56083.04
Break-up of revenue from sale of products ( net of excise duty )
Classification -
Manufactured goods
API & Intermediates	41304.72	33908.12
Home Health	6015.87	790.84
Formulations -
Tablets	3730.45	2882.51
Syrup	824.52	555.49
Capsules	889.76	499.87
Others	254.29	153.49
Formulations Sub-Total	5699.02	4091.36
Sale of Manufactured Goods - (A)	53019.61	38790.32
Traded Goods
Home Health	7959.06	9544.57
Formulations -
Tablets	5591.20	3663.16
Syrups	1972.51	950.21

			(` in Lakhs)
		Year Ended	Year Ended
		31.03.2019	31.03.2018
	Capsules	1089.43	952.21
	Others	965.40	1394.20
	Formulations Sub -Total	9618.54	6959.78
	Total Sales of Stock in Trade - (B)	17577.60	16504.35
	Total Sales Revenues (A+B)	70597.21	55294.67
	22. OTHER INCOME
	Interest Income	82.23	12.05
	Others	284.95	341.96
		367.18	354.01
	23. COST OF MATERIALS CONSUMED
	Raw Materials	32570.03	21323.68
	Packing Materials	1738.06	728.97
		34308.09	22052.65
	Break up of cost of Raw Material consumed
	Classification -
	API & Intermediates	25579.34	18783.32
	Home Health	5504.40	973.17
	Formulations	3224.35	2296.16
	Total	34308.09	22052.65
24.	PURCHASE OF STOCK-IN-TRADE
	Home Health	6118.75	5775.31
	Formulations -
	Tablets	4717.91	3172.53
	Syrups	1562.32	807.27
	Capsules	1018.47	753.22
	Others	856.84	1274.33
	Formulations Sub -total	8155.54	6007.35
	Total	14274.29	11782.66
25.	CHANGE IN INVENTORY
	Opening Balance -
	Work-in-progress	1450.72	1712.54
	Finished goods	727.11	858.49
	Stock-in-trade	1035.01	1138.97
	Stores and spares	174.56	101.89
		3387.40	3811.89
	Closing Balance -
	Work-in-progress	2192.57	1450.72
	Finished goods	1839.68	727.11
	Stock-in-trade	1131.55	1035.01
	Stores and spares	169.61	174.56
		5333.41	3387.40
	Change in Inventory	(1946.01)	424.49

			(` in Lakhs)
		Year Ended	Year Ended
		31.03.2019	31.03.2018
26.	EMPLOYEE BENEFITS EXPENSE
	Salaries and Wages	7528.51	6033.66
	Contribution to provident fund/ ESI	280.58	256.28
	Gratuity and Leave Encashment	338.03	214.89
	Staff Welfare	327.12	317.07
		8474.24	6821.90
27.	FINANCE COST
	Interest expense	157.45	380.71
	Dividends on Cumulative Preference Shares (refer Note No. 18)	49.63	48.75
		207.08	429.46
28.	OTHER EXPENSES
	Consumption of Stores and spare parts	236.29	112.65
	Power and Fuel	1318.15	1108.29
	Rent	358.08	355.66
	Repairs to buildings	178.66	120.62
	Repairs to machinery	437.95	305.57
	General Repairs	93.71	96.43
	Insurance	48.28	42.89
	Research & Development	95.48	50.20
	Quality Control & Testing Charges	440.96	303.22
	Rates and Taxes	135.05	134.02
	Legal and Professional Expenses	1393.00	834.20
	Travelling Expenses	1092.84	971.56
	Selling and Distribution Expenses	3172.21	2912.86
	Miscellaneous Expenses	1110.98	1626.25
		10111.64	8974.42
29.	PAYMENTS TO AUDITORS (excluding Service Tax/GST)
	Statutory Auditors -
	Year Ended
	Audit Fee	20.00	20.00
	Tax Audit Fee	6.00	6.00
	Tax Matters	4.00	4.00
	Certification	1.43	2.71
	Others	1.53	8.71
	Total	32.96	41.42
	Cost Auditors -
	Audit Fees	2.00	2.00
	Total	2.00	2.00

30. PRIOR PERIOD ITEMS

Expenses include Rs. 42.03 Lakhs (Previous Year Rs. 14.73 Lakhs) as expenses (net) relating to earlier years.

			(` in Lakhs)
		Year Ended	Year Ended
		31.03.2019	31.03.2018
31.	DISCLOSURES ABOUT IMPORTS, EXPENDITURE IN FOREIGN CURRENCY, RAW MATERIAL CONSUMPTION & EARNINGS IN FOREIGN EXCHANGE -
	A. VALUE OF IMPORTS ON CIF BASIS
	Raw Materials	22255.89	12465.13
	Stock -in -trade	4456.71	2351.61
	Capital Goods	208.10	122.11
		26920.70	14938.85
	B. EXPENDITURE IN FOREIGN CURRENCY
	Purchase of Capital Goods/ Travel/ Commission	470.79	536.47
		470.79	536.47
	C. VALUE OF IMPORTED AND INDIGENIOUS RAW MATERIAL CONSUMED AND PERCENTAGE THEREOF
	Imported	17964.36	11547.05
	Indigenous	16343.73	10535.61
		34308.09	22082.66
	% Imported	52.36%	52.29%
	% Indigenous	47.64%	47.71%
		100.00%	100.00%
	D. EARNINGS IN FOREIGN EXCHANGE
	Exports of Goods on F.O.B. basis	29692.96	15465.05
	[Excluding third party & deemed exports of Rs.3.50 Lakhs (Previous Year Rs. 2901.25 Lakhs)]	29692.96	15465.05

32. SEGMENT REPORTING

In accordance with Indian Accounting Standard, Ind AS-108 "Operating Segment ", segment information has been given in consolidated financial statements of the company, and therefore, no seperate disclosure on segment information is given in these financial statements.

33. RELATED PARTY DISCLOSURES

Disclosure as required by Indian Accounting Standard "Related Party Disclosures" (Ind AS 24) issued by the Institute of Chartered Accountants of India are as under:

	Related Parties
1.	Subsidiary Companies
	Morepen Inc.	Overseas Company
	Dr. Morepen Limited	Domestic Company
	Total Care Limited	Domestic Company
2.	Key Management Personnel	Mr. Sushil Suri, Chairman & Managing Director Dr. A.K. Sinha, Whole time Director Mr. Ajay Sharma, Chief Financial Officer Mr. Vipul Srivastava, Company Secretary from November 2018 Mr. Thomas P. Joshua, Company Secretary upto September 2018
3.	Relatives of Key Management personnnels with whom the company has any transaction during the year	Mr. Sanjay Suri, Mr. Varun Suri, Mr. Anubhav Suri, Mr. Kushal Suri, Mrs. Sunita Suri, Mrs. Mamta Suri, Mrs. Shalu Suri, Mrs. Sakshi Suri, Mrs. Suhina Suri, Mrs. Bavleen Suri, Mr. Rajas Suri, Mrs. Amita Sharma
4.	Entities over which key management personnel/ or Relatives of key management personnel are able to exercise significant influence with which the company has any transactions during the year	Park Hyatt Goa Resort and Spa (a unit of Blue Coast Hotels Ltd.) Edit 25 Lifestyle Private Limited

Transactions with related parties -

Particulars	Nature of transaction	(` in Lakhs)
1. Subsidiary Companies	Sale of inventories Purchase of inventories Amount payable as on 31.03.19 (Maximum amount outstanding `296.34 Lakhs)	412.17 1.72 139.00
2. Key Management Personnel	Remuneration Balance Payable as on 31.03.19 (Maximum amount outstanding - ` 62.30 Lakhs)	225.17 42.16
3. Entities over which key management personnel/ or Relatives of key management personnel are able to	Receipt of services Balance Payable as on 31.03.19 (Maximum amount outstanding - `158.46 Lakhs)	Nil Nil
exercise significant influence with which the company has any transactions during the year	Receipt of services Balance Payable as on 31.03.19 (Maximum amount outstanding - ` 11.68 Lakhs)	28.00 4.07
4. Relatives of key Management personnnels with whom the company has any transaction during the year	Remuneration Balance Payable as on 31.03.19 (Maximum amount outstanding - ` 161.89 Lakhs)	574.96 149.63

34. EARNING PER SHARE

Particulars		Year Ended
	31.03.2019	31.03.2018
Profit/ (Loss) after Tax (` in Lakhs)	2861.36	2611.52
Weighted average number of equity shares outstanding	449826203	449826203
Earnings/(loss) per share in rupees (face value ` 2/- per share)- Basic & Diluted	0.64	0.58

35. EMPLOYEE BENEFITS

Disclosures as per Accounting Standard, Ind AS -19 'Employee Benefits' is as under -

(A) Disclosures for Defined Contribution Plans -

Particulars	31.03.2019	31.03.2018
Employer's Contribution to Provident Fund	225.04	209.59
Employer's Contribution to Employees State Insurance	55.42	46.68

(B) Disclosures for Defined Benefit Plans - Unfunded

	Particulars		Gratuity		Leave Encashment
I	Change in the present value of obligation:	31.03.2019	31.03.2018	31.03.2019	31.03.2018
	Present Value of Obligation at beginning of the year	1104.18	1042.39	367.56	356.00
	Add: Interest Cost	101.51	82.09	34.49	26.87
	Add: Current Service Cost	92.76	79.54	60.74	30.38
	Less:- Benefit Paid	47.88	88.89	40.11	51.36
	Add: Acturial loss/(gain) on obligations	171.82	(10.95)	54.45	5.67
	Present Value of Obligation as at year end	1422.39	1104.18	477.13	367.56
II	Change in the fair value of plan Assets:	31.03.2019	31.03.2018	31.03.2019	31.03.2018
	Fair Value of Plan Assets at the beginning of year	-	-	-	-
	Add : Expected Return on Plan Assets	-	-	-	-
	Add : Contributions	-	-	-	-
	Less: Benefits Paid	-	-	-	-
	Fair Value of Plan Assets at year end	-	-	-	-
III	Expense recognized in the Profit and Loss Account	31.03.2019	31.03.2018	31.03.2019	31.03.2018
	Current Service Cost	92.76	79.54	60.74	30.38
	Add: Interest Cost	101.51	82.09	34.49	26.87
	Less: Expected Return on plan asstes	-	-	-	-
	Less: Settlement Credit	-	-	5.93	9.67
	Add: Net acturial loss/(gain) recognised	171.82	(10.95)	54.45	5.67
	Total expenses recognized in profit & loss account	366.09	150.68	143.75	53.25

IV The following table sets out the assumptions used in actuarial valuation of gratuity and leave encashment-

31.03.2019	31.03.2018	31.03.2019	31.03.2018
			7.60%
8.30%	5.00%	5.00%	5.00%
-	-	-	-
4.00%	3.00%	3.00%	3.00%
21	20	21	20
	7.70%	7.60%	7.70%

36. IMPAIRMENT

st It is the view of management that there are no impairment conditions that exist as on 31 March, 2019. Hence, no provision is required in the accounts for the year under review.

37. INCOME TAX

As required by Indian Accounting Standard "Income - taxes" i.e. (Ind-AS 12) issued by the Institute of Chartered Accountants of India, deferred tax asset on accumulated losses, is not recognized as a matter of prudence. Current year income tax is provided as per the provisionss of Income Tax Act, 1961.

38. OTHERS SIGNIFICANT DISCLOSURES

• a) In the opinion of directors, all assets stated otherwise have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated in the books of accounts and the provision for depreciation and for all known liabilities is adequate and considered reasonable.
• b) Balances of Non-current liabilities, Current liabilties, Long terms loans and advances, Trade receivables, Short term loans and advances and banks are subject to confirmation.
• c) Sales Tax assessments for earlier years are in progress. Demand, if any, shall be known & accounted for, on the completion of assessments.
• st d) During the financial year ended 31 March, 2010, pursuant to a Scheme of Arrangement & Compromise under Section 391 of th the Companies Act, 1956 approved by the Hon'ble High Court of Himachal Pradesh vide its Order dated 4 August, 2009 the Company allotted 9,24,90,413 Equity Shares to the fixed deposit holders in settlement of their dues. On an appeal filed against the said Order by the Central Government, the Hon'ble Division Bench of the Hon'ble High Court of Himachal Pradesh remanded the matter back to single judge for considering the representation of central government and deciding the matter afresh. The matter was later transferred to Hon'ble National Company Law Tribunal (NCLT), Chandigarh. The Hon'ble NCLT vide its judgment dated 12th March 2018 dismissed the Company's petition seeking approval of the Scheme of arrangement with the Fixed Deposit holders. However, Hon'ble NCLT further stated that the order will not affect the allotment of the shares to the FD holders who have traded the shares to the third parties or transferred the allotted shares. It directed the company that it shall pay the outstanding amount as per the scheme approved by the Company Law Board (CLB) to the original FD holders (except to those who have since traded/transferred the shares allotted to them). The Company had filed an appeal before the Hon'ble National Company Law Appellate Tribunal (NCLAT) at New Delhi against th the order dated 12 March, 2018 of the Hon'ble NCLT, Chandigarh. The Hon'ble NCLAT while issuing notice to the th respondents has stayed the operation of the impugned order dated 12 March, 2018. The Hon'ble National Company Law Appellate Tribunal (NCLAT) after hearing the matter has reserved the order for judgment. Pending disposal of the company's appeal before Hon'ble NCLAT, the liability towards deposit holders, if any, is not ascertained. (Refer Note. No. 20)
• e) In view of the amendments in the Companies Act during the year, the payment of remuneration to directors amounting to ` 356.00 Lakhs for the period April 2005 - March 2014, now does not require approval from central government.
• f) During the year operations u/s 132 of Income Tax Act, 1961 were carried out by Income Tax Department on the premises of the company. No incriminating document was found.
• g) Previous year figures have been regrouped and rearranged wherever necessary to suit the present year layout.

39. Corporate Social Responsibility (CSR)

• st a) During the financial year ended 31 March, 2019, CSR amount required to be spent by the Company as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof was 43.15 Lakh (Previous year 26.18 Lakh).
• b) During the year the Company has made an expenditure of 45.06 Lakh (Previous year 31.80 Lakh) related to CSR.
• st c) Details of CSR expenditure incurred during the year ended 31 March, 2019 is as below :-

		(`/Lakh)
	31.03.2019	31.03.2018
CSR activity
- Promotion of Healthcare	32.55	31.80
- Education	12.51	-
Total	45.06	31.80

Independent Auditor's Report

To the Members of Morepen Laboratories Limited Report on the Audit of Consolidated Financial Statements

st comprise the Consolidated Balance Sheet as at 31 March, Basis for Opinion

under section 133 of the Act read with the Companies audit opinion. (Indian Accounting Standards) Rules, 2015, as amended,

Opinion ("Ind AS") and other accounting principles generally accepted in st India, of the consolidated state of affairs of the Group as at 31 We have audited the accompanying Consolidated Financial March, 2019, the consolidated profit, consolidated total Statements of Morepen Laboratories Limited ("the Holding comprehensive income, consolidated changes in equity and its Company") and its subsidiaries (the Holding Company and consolidated cash flows for the year ended on that date. its subsidiary together referred to as "the Group"), which

2019, the Consolidated Statement of Profit and Loss We conducted our audit in accordance with the Standards on (including Other Comprehensive income), the Consolidated Auditing (SAs) specified under section 143(10) of the Act. Our Statement of Changes in Equity and the Consolidated responsibilities under those Standards are further described in the Statement of Cash Flows for the year ended on that date, and Auditor's Responsibilities for the Audit of the Consolidated a summary of the significant accounting policies and other Financial Statements section of our report. We are independent of explanatory information (hereinafter referred to as "the the Group in accordance with the Code of Ethics issued by the consolidated financial statements"). Institute of Chartered Accountants of India (ICAI) together with the In our opinion and to the best of our information and independence requirements that are relevant to our audit of the according to the explanations given to us, the aforesaid consolidated financial statements under the provisions of the Act consolidated financial statements give the information and the Rules thereunder, and we have fulfilled our other ethical required by the Companies Act, 2013 ("the Act") in the responsibilities in accordance with these requirements and the manner so required and give a true and fair view in ICAI's Code of Ethics. We believe that the audit evidence we have conformity with the Indian Accounting Standards prescribed obtained is sufficient and appropriate to provide a basis for our

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

S. No.	Key Audit Matter	Auditor's Response
1	In the Scheme of Arrangement & Compromise under Section 391 of the Companies Act, 1956 as approved by the Hon'ble High Court of Himachal Pradesh th vide its Order dated 4 August, 2009, the Company allotted 9,24,90,413 Equity Shares to the fixed deposit holders in settlement of their dues. The th Hon'ble NCLT vide its judgment dated 12 March, 2018 dismissed the Company's petition seeking approval of the Scheme and stated that the order will not affect the allotment of the shares to the FD holders who have traded the shares to the third parties or transferred the allotted shares and to the balance FD holders the company shall pay the outstanding amount as per the scheme approved by the Company Law Board (CLB). On an appeal preferred by the company against the said order of NCLT, the Hon'ble National Company Law Appellate Tribunal (NCLAT) stayed the direction of NCLT and reserved the order for judgment after hearing the matter. Refer Note. No. 33(d) to the consolidated financial statements	Principal Audit Procedures We collected the following documents: th - Scheme approved by the Company Law Board (CLB) dated 19 August, 2003. - Scheme of Arrangement & Compromise under Section 391 of the Companies Act, 1956 approved by the Hon'ble High Court th of Himachal Pradesh dated 4 August, 2009. th - Judgment of Hon'ble NCLT dated 12 March 2018 dismissing the Company's petition seeking approval of the Scheme of arrangement with the Fixed Deposit holder. - Copy of order of Hon'ble National Company Law Appellate th Tribunal dated 27 April 2018 staying the direction issued by th Hon'ble NCLT in its order dated 12 March 2018. - Copy of order of Hon'ble National Company Law Appellate th Tribunal (NCLAT) dated 8 April 2019 reserving the order for judgement. We read and analysed the above orders/judgments. The outcome of the judgement may impact financials of the company.

directors of the Holding Company as aforesaid. The Company's Board of Directors is responsible for

In connection with our audit of the consolidated financial process of the Group. materially inconsistent with the consolidated financial our audit, or otherwise appears to be materially misstated. Financial Statements

that give a true and fair view of the consolidated financial on the basis of these consolidated financial statements. position, consolidated financial performance including throughout the audit. We also: with the accounting principles generally accepted in India,

control. making judgements and estimates that are reasonable and

Information Other than the Consolidated Financial due to fraud or error, which have been used for the purpose of Statements and Auditor's Report thereon preparation of the consolidated financial statements by the

preparation of the other information. The other information In preparing the consolidated financial statements, the comprises the information included in Annual Report, but respective board of directors of the entities included in the does not include the consolidated financial statements and Group are responsible for assessing the ability of the Group to our auditor's report thereon. continue as going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of Our opinion on the consolidated financial statement does accounting unless management either intends to liquidate the not cover the other information and we do not express any Group or to cease the operations, or has no realistic alternative form of assurance conclusion thereon. but to do so.

The respective board of Directors of the entities included in the statements, our responsibility is to read the other information Group are responsible for overseeing the financial reporting and, in doing so, consider whether the other information is

statements or our knowledge obtained during the course of Auditor's Responsibilities for the Audit of Consolidated

If, based on the work we have performed, we conclude that Our objectives are to obtain reasonable assurance about there is a material misstatement of this other information, we whether the consolidated financial statements as a whole are are required to report that fact. We have nothing to report in free from material misstatement, whether due to fraud or error, this regard. and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a Management's responsibility for the Consolidated guarantee that an audit conducted in accordance with SAs will Financial Statements always detect a material misstatement when it exists. The Holding Company's Board of Directors is responsible Misstatements can arise from fraud or error and are considered for the preparation and presentation of these consolidated material if, individually or in aggregate, they could reasonably financial statements in terms of the requirements of the Act be expected to influence the economic decisions of users taken

As part of an audit in accordance with SAs, we exercise other comprehensive income, consolidated cash flows and professional judgement and maintain professional skepticism consolidated changes in equity of the Group in accordance

• including the Accounting Standards prescribed under Identify and assess the risks of material misstatement of section 133 of the Act, read with relevant rules issued the consolidated financial statements, whether due to thereunder. fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that The respective board of directors of the entities included in is sufficient and appropriate to provide a basis for our the Group are responsible for maintenance of adequate opinion. The risk of not detecting a material misstatement accounting records in accordance with the provisions of the resulting from fraud is higher than for one resulting from Act for safeguarding the assets of the Group and for error, as fraud may involve collusion, forgery, intentional preventing and detecting frauds and other irregularities, omissions, misrepresentations or the override of internal selection and application of appropriate accounting policies,
• prudent; and design, implementation and maintenance of Obtain an understanding of internal financial controls adequate internal financial controls, that were operating relevant to the audit in order to design audit procedures effectively for ensuring the accuracy and completeness of the that are appropriate in the circumstances. Under section accounting records, relevant to the preparation and 143(3)(i) of the Act, we are also responsible for presentation of the financial statements that give a true and expressing our opinion on whether the company has fair view and are free from material misstatement, whether adequate internal financial controls system in place and

• Conclude on the appropriateness of management's use independence, and where applicable, related of the going concern basis of accounting and, based on safeguards. the audit evidence obtained, whether a material communication. concern.
• Other Matters Evaluate the overall presentation, structure and
• solely on the report of the auditor of such company. statements of which we are independent auditors. For the other entities included in consolidated financial Report on Other Legal and Regulatory Requirements auditors, such other auditors remain responsible for report, to the extent applicable, that: the direction, supervision and performance of the

We communicate with those charged with governance from our examination of those books. the planned scope and timing of the audit and

the operating effectiveness of such controls. We also provide those charged with governance with a statement that we have complied with relevant ethical • Evaluate the appropriateness of accounting policies requirements regarding independence, and to used and the reasonableness of accounting estimates communicate with them all relationships and other and related disclosures made by management. matters that may reasonably be thought to bear on our

From the matters communicated with those charged with uncertainty exists related to events or conditions that governance, we determine those matters that were of may cast significant doubt on the ability of the Group to most significance in the audit of the consolidated continue as a going concern. If we conclude that a financial statements of the current period and are material uncertainty exists, we are required to draw therefore the key audit matters. We describe these attention in our auditor's report to the related matters in our auditor's report unless law or regulation disclosures in the consolidated financial statements or, precludes public disclosures about the matter or when, in if such disclosures are inadequate, to modify our extremely rare circumstances, we determine that a matter opinion. Our conclusions are based on the audit should not be communicated in our report because the evidence obtained up to the date of our auditor's adverse consequences of doing so would reasonably be report. However, future events or conditions may expected to outweigh the public interest benefits of such cause the group to cease to continue as a going

content of the consolidated financial statements, We did not audit the financial statements of foreign subsidiary including the disclosures, and whether the named as Morepen Inc. included in consolidated financial consolidated financial statements represent the statements whose financial statements reflect total assets of Rs. st underlying transaction and events in a manner that 186.45 lakhs as at 31 March, 2019, total revenue of Rs. 105.32 achieves fair presentation. lakhs, total profit after tax of Rs. 18.97 lakhs and total comprehensive income of Rs. 18.97 lakhs for the year ended • Obtain sufficient appropriate audit evidence regarding on that date, as considered in the consolidated financial the financial information of the entities or business statements. The aforesaid financial statements have been activities within the Group to express an opinion on audited by other auditors whose report has been furnished to us the consolidated financial statements. We are by the management and our opinion on the consolidated responsible for the direction, supervision and financial statements, in so far as it relates to the amounts and performance of the audit of the financial statements of disclosures included in respect of this subsidiary, is based such entities included in the consolidated financial

statements, which have been audited by other As required by Section 143(3) of the Act, based on our audit we

• a) We have sought and obtained all the information and audits carried out by them. We remain solely explanations which to the best of our knowledge and responsible for our audit opinion. belief were necessary for the purposes of our audit.
• b) In our opinion, proper books of accounts as required by of the Holding Company and such entities included in law relating to preparation of the aforesaid consolidated the consolidated financial statements of which we are financial statements have been kept so far as it appears independent auditors regarding, among other matters,
• significant audit findings, including any significant c) The Consolidated Balance Sheet, the Consolidated deficiencies in internal control that we identify during Statement of Profit and Loss including other our audit. comprehensive income, the Consolidated Statement of

of Cash Flows dealt with by this report are in agreement provisions of section 197 of the Act.

• read with relevant rules issues thereunder. to the explanations given to us:
• st Indian subsidiaries as on 31 March, 2019 taken on financial position of the Group; record by the Board of Directors of the respective (ii) The Group has made provision in the consolidated terms of section 164(2) of the Act. including derivate contracts;
• f) With respect to the adequacy of the internal financial (iii) During the year, the Group was not liable to transfer operating effectiveness of such controls is as per Fund. Annexure A.
• g) With respect to the other matters to be included in the Chartered Accountants Auditor's Report in accordance with the requirements Firm's Regn. No: 027334N of section 197(16) of the Act, as amended:

In our opinion and to the best of our information and S.K. Goyal according to the explanations given to us, the th Date : 4 May, 2019 (Partner) remuneration paid by the holding company to its

the Changes in Equity and the Consolidated Statement directors during the year is in accordance with the

• with the books of accounts. h) With respect to the other matters to be included in the d) In our Opinion, the aforesaid consolidated financial Auditors' Report in accordance with Rule 11 of the statements comply with the Indian Accounting Companies (Audit and Auditors) Rules, 2014, in our Standards prescribed under section 133 of the Act, opinion and to the best of our information and according
• e) On the basis of the written representations received (i) The consolidated financial statements disclose the from the directors of the Holding company and its impact of pending litigations on the consolidated
• companies, none of the directors of the Group financial statements, as required under the companies incorporated in India is disqualified as on applicable law or accounting standards, for material st 31 March, 2019 from being appointed as a director in foreseeable losses, if any, on long term contracts
• controls over financial reporting of the Group and the any amount to the Investor Education and Protection

For Satinder Goyal & Co.

Place : New Delhi Membership No. : 084613

ANNEXURE "A" TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph (f) under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date on st the consolidated financial statements of Morepen Laboratories Limited for the year ended 31 March 2019)

Report on the Internal Financial Controls over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")

and its subsidiaries which are incorporated in India, are statements, whether due to fraud or error. responsible for establishing and maintaining internal company and its subsidiaries incorporated in India. Guidance Note on Audit of Internal Financial Controls over Institute of Chartered Accountants of India ('ICAI'). These A company's internal financial control over financial reporting is a

financial statements. an audit of internal financial controls. Those Standards and requirements and plan and perform the audit to obtain Financial Reporting reasonable assurance about whether adequate internal Because of the inherent limitations of internal financial controls

In conjunction with our audit of the Consolidated Financial Our audit involves performing procedures to obtain audit Statements of the Holding Company as of and for the year evidence about the adequacy of the internal financial controls st ended 31 March, 2019, we have audited the internal system over financial reporting and their operating effectiveness. financial controls over financial reporting of Morepen Our audit of internal financial controls over financial reporting Laboratories Limited (hereinafter referred to as "the Holding included obtaining an understanding of internal financial controls Company") and its Indian subsidiaries, as of that date. over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating Management's Responsibility for Internal Financial effectiveness of internal control based on the assessed risk. The Controls procedures selected depend on the auditor's judgment, including The respective Board of directors of the holding company the assessment of the risks of material misstatement of the financial

We believe that the audit evidence obtained by us is sufficient and financial controls based on the internal control over financial appropriate to provide a basis for our audit opinion on internal reporting criteria established by these entities, considering financial controls system over financial reporting of the Holding the essential components of internal control stated in the

Financial Reporting (the "Guidance Note") issued by the Meaning of Internal Financial Controls over Financial Reporting

responsibilities include the design, implementation and process designed to provide reasonable assurance regarding the maintenance of adequate internal financial controls that reliability of financial reporting and the preparation of financial were operating effectively for ensuring the orderly and statements for external purposes in accordance with generally efficient conduct of its business, including adherence to accepted accounting principles. A company's internal financial respective company's policies, the safeguarding of its assets, control over financial reporting includes those policies and the prevention and detection of frauds and errors, the procedures that (1) pertain to the maintenance of records that, in accuracy and completeness of the accounting records, and reasonable detail, accurately and fairly reflect the transactions and the timely preparation of reliable financial information, as dispositions of the assets of the company; (2) provide reasonable required under the Act. assurance that transactions are recorded as necessary to permit Auditors' Responsibility preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and Our responsibility is to express an opinion on internal expenditures of the company are being made only in accordance financial controls over financial reporting of the Holding with authorizations of management and directors of the company; company and its subsidiaries incorporated in India, based on and (3) provide reasonable assurance regarding prevention or our audit. We conducted our audit in accordance with the timely detection of unauthorized acquisition, use, or disposition of Guidance Note and the Standards on Auditing prescribed the company's assets that could have a material effect on the under section 143(10) of the Act, to the extent applicable to

the Guidance Note require that we comply with ethical Inherent Limitations of Internal Financial Controls Over

financial controls over financial reporting was established over financial reporting, including the possibility of collusion or and maintained and if such controls operated effectively in improper management override of controls, material all material respects. misstatements due to error or fraud may occur and not be detected. controls over financial reporting to future periods are subject the Guidance Note. to the risk that the internal financial control over financial Other Matters reporting may become inadequate because of changes in

In our opinion, to the best of our information and according solely on the reports of the auditor of such company. to the explanation given to us, and based on the consideration of reports of other auditors, referred to in the For Satinder Goyal & Co. Other Matters paragraph, the Holding company and its Chartered Accountants subsidiaries incorporated in India, have, in all material Firm's Regn. No: 027334N respects, an adequate internal financial controls system over financial reporting and such internal financial controls over st financial reporting were operating effectively as at 31 S.K. Goyal March, 2019, based on the internal control over financial th Date : 4 May, 2019 (Partner) reporting criteria established by the respective companies, Place : New Delhi Membership No. : 084613

Also, projections of any evaluation of the internal financial considering the essential components of internal control stated in

Our aforesaid report under section 143(3)(i) of the Act on the conditions, or that the degree of compliance with the adequacy and operating effectiveness of the internal financial policies or procedures may deteriorate. control over financial reporting in so far as it relates to the financial Opinion statements of foreign subsidiary named as Morepen Inc., is based

Consolidated Balance Sheet

st As at 31 March, 2019

				` ( in Lakhs)
			As at	As at
		Note No.	31.03.2019	31.03.2018
A	ASSETS 1. NON-CURRENT ASSETS
	Property Plant and Equipment	2	14736.71	17239.67
	Goodwill	2	7447.98	7448.54
	Other Intangible Assets	2	1436.25	1741.07
	Financial Assets :
	Loans	3	4.14	2.05
	Other Non-Current Assets	4	7945.82	7805.31
			31570.90	34236.64
	2. CURRENT ASSETS
	Inventories	5	9420.16	7688.69
	Financial Assets :
	Investments	6	2.25	21.78
	Trade Receivables	7	13374.69	12185.05
	Cash and Cash Equivalents	8	959.51	571.61
	Bank Balances other than Cash and Cash Equivalents	9	2261.71	23.38
	Loans	3	39.11	46.31
	Other Financial Assets	10	26.31	10.10
	Other current assets	11	3863.10	3797.08
			29946.84	24344.00
B.	TOTAL EQUITY AND LIABILITIES		61517.74	58580.64
	1. EQUITY
	Equity Share Capital	12	8995.86	8995.86
	Other Equity		16313.42	13598.30
			25309.28	22594.16
	2. MINORITY INTEREST	13	(46.31)	(45.42)
	3. NON - CURRENT LIABILITIES
	Financial Liabilties :-
	Borrowings	14	182.92	294.73
	Other Financial liabilities	15	253.65	282.66
	Provisions	16	1901.21	1442.37
			2337.78	2019.76
	4. CURRENT LIABILITIES
	Financial Liabilties :- Borrowings	14	898.97	-
	Trade Payables	17	16815.02	17488.44
	Other Financial liabilities	18	14875.81	15576.77
	Other Current Liabilties	19	1188.59	813.60
	Provisions	16	138.60	133.33
			33916.99	34012.14
	TOTAL		61517.74	58580.64
	SIGNIFICANT ACCOUNTING POLICIES	1
	NOTES ON FINANCIAL STATEMENTS	2-34
	As per our separate report of even date		For & on behalf of the Board of Directors of Morepen Laboratories Ltd.

For Satinder Goyal & Co. (Sushil Suri) (Manoj Joshi)

Partner Chief Financial Officer Company Secretary Membership No. 084613

Place : New Delhi th Date : 4 May, 2019

Chartered Accountants Chairman & Managing Director Director Firm Regn. No. 027334N DIN : 00012028 DIN : 00036546

Consolidated Statement Of Profit And Loss

st For the Year Ended 31 March, 2019

			` ( in Lakhs )
		Year Ended	Year Ended
	Note No.	31.03.2019	31.03.2018
REVENUE
Sales Revenue	21	75621.44	59775.29
Other Income		1232.40	875.62
Revenue from operations (Net)	21	76853.84	60650.91
Other Income	22	367.18	372.27
Total Income (I)		77221.02	61023.18
EXPENSES
Cost of Materials Consumed	23	34308.09	22052.65
Purchases of Stock-in-Trade		17329.47	14457.40
Changes in inventories of Finished goods
Work-in-progress and Stock-in-Trade		(1987.78)	347.06
Employee Benefits Expense	24	9536.47	7653.37
Finance Cost	25	211.00	435.73
Depreciation and Amortization Expense	2	3990.29	3432.20
Other Expenses	26	10915.81	9667.68
Total Expenses (II)		74303.35	58046.09
Profit before Tax		2917.67	2977.09
Tax Expense
Tax		(246.33)	-
Tax Credit Entitlement		212.70	-
Profit for the Year (III)		2884.04	2977.09
Share of minority interest in Profit/ (loss)		(0.89)	17.95
Profit for the year available for majority shareholders		2884.93	2959.14
Other Comprehensive Income
Items that will not be reclassified to Profit & Loss		(169.11)	8.87
Tax		36.33	-
Tax Credit Entitlement		(37.03)	-
Other Comprehensive Income for the Year (Net of Tax) (IV)		(169.81)	8.87
Total Comprehensive Income for the Year (III+IV)		2715.12	2968.01
Earning per equity share (Face Value of Rs. 2/- each)	30
(1) Basic		0.64	0.66
(2) Diluted		0.64	0.66
SIGNIFICANT ACCOUNTING POLICIES	1
NOTES ON FINANCIAL STATEMENTS	2-34
As per our separate report of even date	For & on behalf of the Board of Directors of Morepen Laboratories Ltd.
For Satinder Goyal & Co. (Sushil Suri)		(Manoj Joshi)

Membership No. 084613

Place : New Delhi th Date : 4 May, 2019

Chartered Accountants Chairman & Managing Director Director Firm Regn. No. 027334N DIN : 00012028 DIN : 00036546

Partner Chief Financial Officer Company Secretary

Consolidated Cash Flow Statement

st For the Year Ended 31 March, 2019

				` ( in Lakhs )
			Year Ended	Year Ended
		Notes No.	31.03.2019	31.03.2018
A.	CASH FLOWS FROM OPERATING ACTIVITIES :
	Profit before Tax		2917.67	2977.08
	Adjustments for :
	Depreciation & Amortisation	2	3990.29	3432.20
	(Profit)/Loss on Sale of Fixed Assets		0.06	5.50
	Provision for Employee benefit (OCI)		(169.11)	8.87
	Finance Cost (Net)	25	211.00	435.73
	Minority Interest		0.89	(17.95)
	Operating Profit before changes in Current Assets and Liabilities		6950.80	6841.43
	Changes in Current Assets and Liabilities -
	Trade Receivables	7	(1189.64)	(2889.93)
	Loans, Bank balance other than cash &
	Cash equivalent and other Current Assets	3,9,10,11	(2313.36)	(1513.26)
	Inventories	5	(1731.47)	(1222.20)
	Current Liabilities	16,17,18,19	55.08	5125.36
	Cash generated from operations		1771.41	6341.41
	Income Tax (Net)		(34.36)	-
	NET CASH GENERATED FROM OPERATING ACTIVITIES		1737.05	6341.41
B.	CASH FLOWS FROM INVESTING ACTIVITIES:
	Purchase of Property, Plant & Equipments		(850.60)	(1032.80)
	Purchase/Addition of Intangibles/Goodwill (Net)		(333.18)	(1655.44)
	Proceeds from Sale of Property, Plant & Equipments		1.80	1.58
	Sales/(Purchase) of Investments (Net)	6	19.53	(21.78)
	Investment in Other Non-Current Assets	3,4	(142.60)	15.56
	NET CASH USED IN INVESTING ACTIVITIES		(1305.05)	(2692.89)
C.	CASH FLOWS FROM FINANCING ACTIVITIES:
	Finance Cost	25	(211.00)	(435.73)
	Change in Long Term borrowings (Net)	14	(1161.01)	(3442.93)
	Proceeds (Repayments) of Short Term Borrowings (Net) Change in Other Non- Current Liabilities & Provisions (Net)	14 13,15,16	898.97 428.94	- 101.29
	NET CASH USED IN FINANCING ACTIVITIES		(44.10)	(3777.37)
	Net Increase/(Decrease) in Cash and Cash Equivalents (A+B+C) Cash and Cash Equivalents as at Begining of the Year		387.90 571.61	(128.85) 700.47
	Cash and Cash Equivalents as at End of the Year		959.51	571.61
	Bank Balances other than Cash and Cash Equivalents		2261.71	23.38
	SIGNIFICANT ACCOUNTING POLICIES	1
	NOTES ON FINANCIAL STATEMENTS	2-34

Partner Chief Financial Officer Company Secretary Membership No. 084613

Place : New Delhi th Date : 4 May, 2019

As per our separate report of even date For & on behalf of the Board of Directors of Morepen Laboratories Ltd.

For Satinder Goyal & Co. (Sushil Suri) (Manoj Joshi) Chartered Accountants Chairman & Managing Director Director Firm Regn. No. 027334N DIN : 00012028 DIN : 00036546

Consolidated statement of changes in Equity

SIGNIFICANT ACCOUNTING POLICIES 1

st For the Year Ended 31 March, 2019

A. EQUITY SHARE CAPITAL

st	Change in equity share capital	st
Balance as at 1 April, 2018	during the year	Balance as at 31 March, 2019
8995.86	-	8995.86

B. OTHER EQUITY

Place : New Delhi th Date : 4 May, 2019

		RESERVES & SURPLUS			Other items	Total
	Capital Reserve	Capital Redemption Reserve	Securities Premium	Retained Earnings	of other comprehensive income	Other Equity
Balance as at 1st April, 2018	270.40	7123.33	16740.51	(10486.02)	(49.92)	13598.30
Profit for the year	-	-	-	2884.93	-	2884.93
Other comprehensive income/(loss) for the year	-	-	-	-	(169.81)	(169.81)
Total comprehensive income/(loss) for the year	-	-	-	2884.93	(169.81)	2715.12
Balance as at 31st March, 2019	270.40	7123.33	16740.51	(7601.09)	(219.73)	16313.42

NOTES ON FINANCIAL STATEMENTS	2-34
As per our separate report of even date	For & on behalf of the Board of Directors of Morepen Laboratories Ltd.
For Satinder Goyal & Co.	(Sushil Suri)	(Manoj Joshi)
Chartered Accountants	Chairman & Managing Director	Director
Firm Regn. No. 027334N	DIN : 00012028	DIN : 00036546
(CA S. K. Goyal)	(Ajay Sharma)	(Vipul Kumar Srivastava)
Partner	Chief Financial Officer	Company Secretary
Membership No. 084613

1. COMPANY OVERVIEW AND SIGNIFICANT ACCOUNTING POLICIES

environment in which the Company operates. Public limited company incorporated and domiciled in India and has its listing on the BSE Limited and Basis of measurement National Stock Exchange of India Limited. The These financial statements are prepared under the addresses of its registered office and principal place of historical cost convention unless otherwise indicated. business are disclosed in the introduction to the Operating Cycle annual report. The Company has its manufacturing locations situated in the state of Himachal Pradesh Based on the nature of products/activities of the with trading and other incidental and related activities company and normal time between acquisition of extending to both domestic and global markets. The assets and their realisation in cash or cash equivalents, Company is in the business of manufacturing, the company has determined its operating cycle as 12 producing, developing and marketing a wide range of months for the purpose of classification of its assets Active Pharmaceutical Ingredients (APIs), branded and liabilities as current and non-current. and generic formulations and also the Home Health 1.2 Use of Estimates and Judgements products.

These financial statements are prepared in to make estimates, judgements and assumptions. accordance with the Indian Accounting Standards These estimates, judgements and assumptions affect (Ind AS) notified under the Companies (Indian the application of accounting policies and the Accounting Standards) Rules, 2015 as amended by reported balances of assets and liabilities, disclosures the Companies (Indian Accounting Standards) of contingent assets and liabilities as at the date of (Amendment) Rules, 2016, the relevant provisions of financial statements and the reported amount of the Companies Act, 2013 ("the Act'') and guidelines revenues and expenses during the year. Examples of issued by the Securities and Exchange Board of India such estimates include provisions for doubtful debts,

impairments & others. financial statements of Morepen Laboratories Ltd. (parent company) and its three subsidiaries namely Accounting estimates could change from period to

Subsidiary Company	Country of	Percentage of	1.3	financial statements. Property, Plant and Equipment (PPE)
	Incorporation	Holding (%)
Morepen Inc.	U.S.A.	100		The Company has elected to continue with the
Dr. Morepen Ltd.	India	100		carrying value of all its property, plant and equipment as recognized in the financial statements as at the date
Total Care Ltd.	India	95*		of transition to Ind AS, measured as per the previous

The financial statements are authorized for issue by AS 101. the Board of Directors of the Company at their th a) Free hold land is carried at cost. All other items of meeting held on 4 May, 2019.

The financial statements are presented in Indian PPE comprises its purchase price, including

1.0 Company Overview Rupees, which is the functional currency of the Company and the currency of the primary economic Morepen Laboratories Limited ("the Company") is a

The presentation of financial statements in conformity 1.1 Basis for preparation of financial statements with Ind AS requires the management of the company (SEBI), as applicable. employee benefits, provisions for income taxes, useful life of depreciable assets and provisions for The consolidated financial statements consist of

Dr. Morepen Ltd., Total Care Ltd., (Domestic period. Actual results could differ from those Companies) and Morepen Inc. (Foreign Company). estimates. Appropriate changes in estimates are made Financial statements of foreign subsidiary have been as management becomes aware of changes in recasted for the purpose of consolidation. circumstances surrounding the estimates. Changes in estimates are reflected in the financial statements in The names of subsidiary companies included in the period in which changes are made and, if consolidation and parent company's holding therein material, their effects are disclosed in the notes to are as underfinancial statements.

1.3 Property, Plant and Equipment (PPE) Incorporation Holding (%)

Morepen Inc. U.S.A. 100 The Company has elected to continue with the carrying value of all its property, plant and equipment Dr. Morepen Ltd. India 100 as recognized in the financial statements as at the date GAAP and use that as the deemed cost as at the *(Held by Dr. Morepen Limited) transition date pursuant to the exemption under Ind

Property, plant and equipment are stated at cost, Functional and Presentation Currency less accumulated depreciation. The initial cost of import duties and non-refundable purchase for on a prospective basis. taxes, and any directly attributable costs of 1.5 Depreciation bringing an asset to working condition and technical assessment. losses, if any. Expenditure incurred after the PPE

• charged in full during the year. property, plant and equipment outstanding at
• d) The cost and related accumulated depreciation method and useful lives are reviewed periodically are eliminated from the financial statements upon at end of each financial year. sale or retirement of the asset and the resultant 1.6 Valuation of inventories gains or losses are recognized in the statement of

Internally generated Intangible Assets - Research and raw material cost up to the stage of completion, as

Expenditure pertaining to research is expensed as Goods in transit are carried at cost. incurred. Expenditure incurred on development is 1.7 Foreign Currency Transactions / Translations capitalised if such expenditure leads to creation of an i) Transactions denominated in foreign currency asset and/or benefits are expected over more than one are recorded at exchange rates prevailing at the period, otherwise such expenditure is charged to the date of transaction or at rates that closely Statement of Profit and Loss.

Expenditure providing benefits for more than one transaction. period is amortised proportionately over the periods

Intangible assets with finite useful lives that are exchange rate at the reporting date. Nonacquired separately are carried at cost less monetary assets and liabilities that are measured accumulated amortisation and accumulated based on historical cost in a foreign currency are impairment, if any. The Company determines the translated at the exchange rate at the date of the amortisation period as the period over which the transaction. future economic benefits will flow to the Company iii) Exchange differences on monetary items are after taking into account all relevant facts and recognised in the Statement of Profit and Loss in circumstances. The estimated useful life and the period in which they arise except for amortisation method are reviewed periodically, with exchange differences on foreign currency the effect of any changes in estimate being accounted

Depreciation is the systematic allocation of the location for its intended use, including relevant depreciable amount of PPE over its useful life and is borrowing costs and any expected significant provided on a straight-line basis over the useful lives costs of decommissioning, less accumulated as prescribed in Schedule II to the Act or as per depreciation and accumulated impairment

• have been put into operation, such as repairs and a) Depreciation on fixed assets is provided on maintenance, are charged to the Statement of straight-line method at the rates prescribed by the Profit and Loss in the period in which the costs are schedule II of the Companies Act, 2013 and in the incurred. manner as prescribed by it except assets costing less than Rs. 5000/- on which depreciation is b) Advances paid towards the acquisition of
• each balance sheet date is classified as capital b) Intangible assets are amortized over their advances under other non-current assets. respective individual estimated useful life on straight line basis, commencing from the date the c) Capital work-in-progress in respect of assets which are not ready for their intended use are asset is available to the company for its use. The estimated useful life of an identifiable intangible carried at cost, comprising of direct costs, related asset is based on a number of factors including the incidental expenses and attributable interest. effects of obsolescence, etc. The amortization

profit and loss. Assets to be disposed off are Stocks of raw materials and other ingredients have reported at the lower of the carrying value or the been valued on First in First Out (FIFO) basis, at cost or fair value less cost to sell. net realizable value whichever is less, finished goods and stock-in-trade have been valued at lower of cost 1.4 Intangible Assets and Amortisation and net realizable value, work-in-progress is valued at Development expenditure certified by the management on technical basis.

• approximate the rate at the date of the
• ii) Monetary assets and liabilities denominated in during which benefits are expected to occur. foreign currencies at the reporting date are Intangible Assets acquired separately translated into the functional currency at the

borrowings relating to assets under construction i) Initial Recognition and measurement for future productive use, which are included in On initial recognition, all the financial assets and the cost of those assets when they are regarded as liabilities are recognized at its fair value plus or an adjustment to interest costs on those foreign minus transaction costs that are directly

• iv) Foreign exchange differences recorded as an financial asset or financial liability except adjustment to borrowing costs are presented in financial asset or financial liability measured at the statement of profit and loss, as a part of fair value through profit or loss ("FVTPL"). finance cost. All other foreign exchange gains and Transaction costs of financial assets and liabilities losses are presented in the statement of profit and carried at fair value through the Profit and Loss are loss on net basis. immediately recognized in the Statement of Profit
• and Loss. v) In case of long term monetary items outstanding as at the end of year, exchange differences arising ii) Subsequent measurement on settlement / restatement thereof are capitalised a) Financial assets carried at amortised cost as part of the depreciable fixed assets to which the monetary item relates and depreciated over the A financial asset is subsequently measured at amortised cost if it is held within a remaining useful life of such assets. If such monetary items do not relate to acquisition of business model whose objective is to hold the asset in order to collect contractual cash depreciable fixed assets, the exchange difference flows and the contractual terms of the is amortised over the maturity period / up to the financial asset give rise on specified dates to date of settlement of such monetary items, whichever is earlier, and charged to the cash flows that are solely payments of principal and interest on the principal Statement of Profit and Loss.

1.8 Dividends

Final dividends on shares are recorded as a liability on comprehensive income (FVTOCI) the date of approval by the shareholders and interim A financial asset is subsequently measured dividends are recorded as a liability on the date of at fair value through other comprehensive declaration by the company's Board of Directors.

Leases under which the company assumes collecting contractual cash flows and selling substantially all the risks and rewards of ownership financial assets and the contractual terms of are classified as finance leases. When acquired, such the financial asset give rise on specified assets are capitalized at fair value or present value of dates to cash flows that are solely payments minimum lease payments at the inception of lease, of principal and interest on the principal whichever is lower. Lease under which the risks and amount outstanding. rewards incidental to ownership are not transferred to c) Financial assets at fair value through profit lessee, is classified as operating lease. Lease payments or loss (FVTPL) under operating leases are recognized as an expense A financial asset is measured at fair value on a straight line basis in net profit in the statement of

A financial instrument is any contract that gives rise to d) Investments in subsidiaries, joint ventures a financial asset of one entity and a financial liability and associates or equity instrument of another entity.

Financial assets and financial liabilities are recognised investments in subsidiaries, joint ventures when a Company becomes a party to the contractual and associates at cost in accordance with

currency borrowings. attributable to the acquisition or issue of the

amount outstanding.

b) Financial assets at fair value through other

income if it is held within a business model 1.9 Leases whose objective is achieved by both

through profit and loss unless it is measured profit and loss over the lease term. at amortized cost or at fair value through 2.0 Financial Instruments other comprehensive income.

The Company has adopted to measure provisions of the instruments. Ind AS 27 and carrying amount as per previous GAAP at the date of transition has 2.1 Impairment of Assets been considered as deemed cost in i) Financial Assets accordance with Ind AS 101.

financial liabilities at FVTPL or 'other which are not fair valued through profit or loss.

are subsequently measured at amortised or loss in statement of profit or loss. cost using the effective interest method. ii) Non-Financial Assets

impairment loss, if any. A financial asset is derecognized when the contractual rights to the cash flows from the The impairment loss is recognised as an expense financial asset expire or it transfers the financial in the Statement of Profit and Loss, unless the asset and the transfer qualifies for derecognition asset is carried at revalued amount, in which case under Ind AS 109. A financial liability is any impairment loss of the revalued asset is derecognized when the obligation specified in treated as a revaluation decrease to the extent a the contract is discharged or cancelled or expired. revaluation reserve is available for that asset.

iv) Fair value measurement of financial instruments The recoverable amount is the greater of the net

selling price and their value in use. Value in use is The fair value of financial instruments is arrived at by discounting the future cash flows to determined using the valuation techniques that their present value based on an appropriate are appropriate in the circumstances and for discount factor. which sufficient data are available to measure fair value, maximising the use of relevant observable When there is indication that an impairment loss inputs and minimising the use of unobservable recognised for an asset (other than a revalued

In case of financial instruments where the 2.2 Revenue Recognition carrying amount approximates fair value due to amount is considered as fair value. that the economic benefits will flow to the Company

In accordance with Ind AS 109, the company e) Financial liabilities recognizes loss allowances using the expected Financial liabilities are classified as either credit loss (ECL) model for the financial assets

financial liabilities'. Loss allowance for trade receivables with no Financial liabilities at FVTPL significant financing component is measured at an amount equal to lifetime ECL. For all other Financial liabilities are classified as at FVTPL financial assets, expected credit losses are when the financial liability is held for measured at an amount equal to the 12-month trading or are designated upon initial ECL, unless there has been a significant increase recognition as FVTPL. Gains or Losses on in credit risk from initial recognition in which liabilities held for trading are recognised in case those are measured at lifetime ECL. The the Statement of Profit and Loss. amount of expected credit losses (or reversal) that Other Financial liabilities is required to adjust the loss allowance at the Other financial liabilities (including reporting date to the amount that is required to be borrowings and trade and other payables) recognised is recognized as an impairment gain

For trade and other payables maturing The carrying amounts of the Company's tangible within one year from the balance sheet date, and intangible assets are reviewed at each the carrying amounts approximate fair value reporting date to determine whether there is any due to the short maturity of these indication of impairment. If any such indication instruments. exists, then the asset's recoverable amount is iii) Derecognition of financial instruments estimated in order to determine the extent of the

inputs. asset) in earlier accounting periods no longer exists or may have decreased, such reversal of Based on the three level fair value hierarchy, the impairment loss is recognised in the Statement of methods used to determine the fair value of Profit and Loss, to the extent the amount was financial assets and liabilities include quoted previously charged to the Statement of Profit and market price, discounted cash flow analysis and Loss. In case of revalued assets, such reversal is valuation certified by the external valuer. not recognised.

the short maturity of those instruments, carrying Revenue is recognized to the extent that it is probable

tax benefit will be realized. trade discounts, Goods and Services Tax (GST).

b) Dividend income is accounted for when the right the years in which those temporary differences are

interest rate (EIR). EIR is the rate that exactly discounts be utilized.

Income tax expense comprises current tax and 2.5 Borrowing Costs

Current income tax for current and prior periods is incurs in connection with the borrowing of funds. recognized at the amount expected to be paid to or Borrowing cost also includes exchange differences to recovered from the tax authorities, using the tax rates the extent regarded as an adjustment to the borrowing and tax laws that have been enacted or substantively costs. enacted by the balance sheet date. The Company 2.6 Provisions, contingent liabilities and contingent offsets current tax assets and current tax liabilities, assets where it has a legally enforceable right to set off the recognized amounts and where it intends either to Provisions are recognised when the Company has a settle on a net basis, or to realize the asset and settle present obligation (legal or constructive) as a result of

resources, that can be reliably estimated, will be Deferred income tax assets and liabilities are required to settle such an obligation. recognized for all temporary differences arising between the tax base of assets and liabilities and their If the effect of the time value of money is material, carrying amounts in the financial statements except provisions are determined by discounting the when the deferred income tax arises from the initial expected future cash flows to net present value using recognition of an asset or liability in a transaction that an appropriate pre-tax discount rate that reflects is not a business combination and affects neither current market assessments of the time value of

and the amount can be reliably measured. accounting nor taxable profit or loss at the time of the transaction. Deferred tax assets and liabilities are a) Revenue is recognised at the fair value of the reviewed at each reporting date and are reduced to consideration received or receivable. The the extent that it is no longer probable that the related amount disclosed as revenue is net of returns,

Deferred income tax assets and liabilities are Provisions for rebates, discount and return are measured using tax rates and tax laws that have been estimated and provided for in the year of sales and enacted or substantively enacted by the balance sheet recorded as reduction of revenue. date and are expected to apply to taxable income in to receive the income is established. expected to be recovered or settled. The effect of 2.3 Interest changes in tax rates on deferred income tax assets and liabilities is recognized as income or expense in the Interest income from a financial asset is recognized period that includes the enactment or the substantive when it is probable that the economic benefits will enactment date. A deferred income tax asset is flow to the company and the amount of income can recognized to the extent that it is probable that future be measured reliably. taxable profit will be available against which the Income from interest is recognized using the effective deductible temporary differences and tax losses can

the estimated future cash payments or receipts over Minimum Alternate Tax credit is recognised as the expected life of the financial instrument or a deferred tax asset only when and to the extent there is shorter period, where appropriate, to the gross convincing evidence that the Company will pay carrying amount of the financial asset. When normal income tax during the specified period. Such calculating the effective interest rate, the Company asset is reviewed at each Balance Sheet date and the estimates the expected cash flows by considering all carrying amount of the MAT credit asset is written the contractual terms of the financial instrument but down to the extent there is no longer a convincing does not consider the expected credit losses. evidence to the effect that the Company will pay 2.4 Income Taxes normal income tax during the specified period.

deferred tax. Income tax expense is recognized in net Borrowing costs that are directly attributable to the profit in the statement of profit and loss except to the acquisition, construction or production of a qualifying extent that it relates to items recognized directly in asset are capitalized as part of the cost of the asset. equity or other comprehensive income, in which case Other borrowing costs are recognized as an expense it is also recognized in equity or other comprehensive in the period in which they are incurred. Borrowing income respectively. costs consist of interest and other costs that an entity

the liability simultaneously. a past event and it is probable that an outflow of

money and, where appropriate, the risks specific to ii) Post – employment benefits the liability. Unwinding of the discount is recognised Defined contribution plans – in the Statement of Profit and Loss as a finance cost. Retirement benefits in the form of provident fund Provisions are reviewed at each reporting date and are is a defined contribution scheme. The company adjusted to reflect the current best estimate.

A present obligation that arises from past events where payable to the provident fund. Payments to it is either not probable that an outflow of resources defined contribution plans are recognised as an will be required to settle or a reliable estimate of the expense when employees have rendered service amount cannot be made, is disclosed as a contingent entitling them to the contributions. liability. Contingent liabilities are also disclosed when Defined benefit plans – there is a possible obligation arising from past events, the existence of which will be confirmed only by the Gratuity occurrence or non -occurrence of one or more The company has an obligation towards gratuity, uncertain future events not wholly within the control a defined benefit retirement plan covering of the Company. eligible employees. The Gratuity payment plan

Claims against the Company where the possibility of provides for a lump sum payment to the vested any outflow of resources in settlement is remote, are employees at retirement, death, incapacitation not disclosed as contingent liabilities. while in employment or on termination of

respective employee's salary and tenure of statements since this may result in the recognition of employment. Vesting occurs upon completion of income that may never be realised. However, when five years of service. the realisation of income is virtually certain, then the related asset is not a contingent asset and is Liabilities with regard to the Gratuity Plan are recognised. determined by actuarial valuation, performed by

Basic earning per share is calculated by dividing the measurements comprising of actuarial gains and net profit or loss for the year attributable to the equity losses, are recognised in other comprehensive shareholders (after deducting preference dividends income which are not reclassified to profit or loss and attributable taxes) by the weighted average in the subsequent periods. number of equity shares outstanding during the year.

For the purpose of calculating the diluted earnings per Leave Encashment share, the net profit or loss for the period attributable to equity shareholders and the weighted average The liability of accumulating compensated number of shares outstanding during the period are absences is determined by actuarial valuation adjusted for the effects of all dilutive potential equity performed by an independent actuary at each shares. The dilutive potential equity shares are balance sheet date using projected unit credit deemed converted as at beginning of the period, method. unless they have been issued at a later date. 2.9 Segment Reporting

i) Short term employee benefits segment i.e. "Pharmaceuticals".

All employee benefits payable/available within 3.0 Cash and cash equivalents

has no obligation, other than the contribution

employment of an amount based on the Contingent assets are not recognised in financial

an independent actuary, at each balance sheet 2.7 Earning per share date using the projected unit credit method. Re-

iii) Long – term employee benefits

2.8 Employee Retirement benefits The company operates in one reportable business

twelve months of rendering the service are Cash and cash equivalents in the Balance Sheet classified as short term employee benefits. comprise cash at bank and in hand and short-term Benefits such as salaries, wages and bonus etc., deposits with banks that are readily convertible into are recognised in the statement of profit and loss cash which are subject to insignificant risk of changes in the period in which the employee renders the in value and are held for the purpose of meeting short- related service. term cash commitments.

st NOTES ON CONSOLIDATED FINANCIAL STATEMENTS AS AT 31 MARCH, 2019

2. I) PROPERTY, PLANT AND EQUIPMENT

TANGIBLE ASSETS

										) Lakhs in ` (
			GROSS BLOCK			DEPRECIATI	MORTIZATI ON/A	ON		CARRYING VALUE
PARTICULARS	As at 01.04.2018	Additions	(Disposals)/ Adjustments	As at 31.03.2019	As at 01.04.2018	For the year	Deductions/ Adjustments	As at 31.03.2019	As at 31.03.2019	As at 31.03.2018
Land	158.22	-	-	158.22	-	-	-	-	158.22	158.22
Buildings	7385.67	64.06	-	7449.73	3296.62	178.83	-	3475.45	3974.28	4089.05
Machinery Plant &	78861.76	710.56	(12150.61)*	67421.71	66569.99	3039.19	(12150.61)	57458.57	9963.14	12291.77
Furnitures & Fixtures	332.84	29.20	-	362.04	267.20	8.95	-	276.15	85.89	65.64
Vehicles	828.21	2.92	(17.32)	813.81	279.63	86.53	(15.46)	350.70	463.11	548.58
Office Equipments	273.55	43.86	-	317.41	187.14	38.20	-	225.34	92.07	86.41
Total	87840.25	850.60	(12167.93)	76522.92	70600.58	3351.70	(12166.07)	61786.21	14736.71	17239.67
Previous Year	92431.05	1032.84	(5623.64)	87840.25	73089.63	3127.46	(5616.51)	70600.58	17239.67
WILL OOD II) G
Goodwill	7450.22	-	-	7450.22	1.68	0.56	-	2.24	7447.98	7448.54
Total	7450.22	-	-	7450.22	1.68	0.56	-	2.24	7447.98	7448.54
Previous Year	7797.20	-	(346.98)	7450.22	1.12	0.56	-	1.68	7448.54
OTHER INTANGIBLE ASSETS III)
Computer Software	196.86	1.80	-	198.66	122.02	27.08	-	149.10	49.56	74.84
Acquisition Cost Customer	1585.09	331.38	-	1916.47	270.40	592.66	-	863.06	1053.41	1314.69
Patents & Trade
Marks	2687.73	-	-	2687.73	2336.19	18.26	-	2354.45	333.28	351.54

Previous Year 102695.51 3035.26 (5970.62) 99760.15 75515.18 3432.20 (5616.51) 73330.87 26429.28 Note -

GRAND TOTAL

a) Trade mark "Burnol" forming part of Patents & Trade Marks was given as a Collateral security against inter-corporate deposit taken by the parent company. Legal case in respect of the above trade mark is pending final adjudication.

Total 4469.68 333.18 - 4802.86 2728.61 638.00 - 3366.61 1436.25 1741.07

Previous Year 2467.26 2002.42 - 4469.68 2424.43 304.18 - 2728.61 1741.07

Current year 99760.15 1183.78 (12167.93) 88776.00 73330.87 3990.29 (12166.07) 65155.06 23620.94 26429.28

• b) Freehold land includes land having gross value of Rs. 14.94 Lakhs sold in earlier years and advance received against sale revenue on this transaction is not recognised in the books as some obligations are still pending to be completed.
• c) Customer Acquisition Cost represents amount spent for the expansion of product market and increase in customer reach.
• d) * Old machinery no longer in use, depreciated and written off during the year.

LOANS
		Current Portion	Non Current Portion
	As at 31.03.19	As at 31.03.18	As at 31.03.19	As at 31.03.18
Secured
(Unsecured, considred good)
Financial Assets at amortised cost	-	-	-	-
Loans to Employees	39.11	46.31	4.14	2.05
	39.11	46.31	4.14	2.05
			As at	(` in Lakhs) As at
			31.03.2019	31.03.2018
OTHER NON CURRENT ASSETS
Unsecured Capital Advances*			7143.00	7203.50
Leasehold Land Prepayments			25.34	25.70
Prepaid (Deffered)Expenses for Employee Benefit			2.57	1.16
Security Deposits			223.01	206.09
Due from Income Tax Department			551.90	368.86

7124.19 Lakhs (Previous year 7184.69 Lakhs) advanced for the acquisition/new business opportunity and buyout of new brands. The company expects to complete the transaction in a year's time.

5. INVENTORIES

Raw Materials	3747.92	4005.01
Work-in-progress	2192.57	1450.72
Finished goods	1839.68	727.11
Stock -in-trade	1467.55	1329.24
Goods in transit	2.83	2.05
Stores and spares	169.61	174.56
	9420.16	7688.69

The inventory of stocks, stores and spares has been taken, valued and certified by the management.

6. INVESTMENTS (NON-CURRENT)

Other Investments (At Cost)

Investment in Mutual Funds

			(` in Lakhs)
		As at 31.03.2019	As at 31.03.2018
	Nil (Previous Year : 21000 Units) of ` 100/- each of ICICI Prudential Saving Fund-Daily Dividend	-	21.68
	Nil (Previous Year 100 Units ) of ` 100/- each of
	ICICI Prudential Money Market Fund-Daily Dividend	-	0.10
	37 Units (Previous Year : Nil) of Aditya Birla Sun Life Equity Fund	0.25	-
	120 Units (Previous Year : Nil) of
	Aditya Birla Sun Life Frontline Equity Fund	0.25	-
	640 Units (Previous Year : Nil) of ICICI Prudential Bluechip Fund	0.25	-
	758 Units (Previous Year : Nil) of Kotak Standard Multicap Fund	0.25	-
	134 Units (Previous Year : Nil) of Franklin India Prima Fund	1.25	-
		2.25	21.78
	Market Value of Quoted Investments	2.39	21.78
7.	TRADE RECEIVABLES
	Unsecured -
	Considered good	13374.69	12185.05
	Considered doubtful	130.26	146.46
	Less: Allowance for bad & doubtful debts	(130.26)	(146.46)
		13374.69	12185.05
8.	CASH AND CASH EQUIVALENTS
	Balances with banks
	Current Accounts	948.47	558.95
	Cash in hand	11.04	12.66
		959.51	571.61
9.	BANK BALANCES OTHER THAN CASH AND CASH EQUIVALENTS
	Earmarked balances with banks
	Margin Money & Security against Overdraft, Bills discounting
	and LC facilities (Refer Note No. 14)	2229.06	11.82
	Guarantees	32.65	11.56
		2261.71	23.38
10.	OTHER FINANCIAL ASSETS
	Interest accrued but not due	26.31	10.10
		26.31	10.10

			(` in Lakhs)
		As at 31.03.2019	As at 31.03.2018
11.	OTHER CURRENT ASSETS
	Unsecured considered good, unless otherwise stated
	Advances with Suppliers & Others	1766.99	1690.79
	Leasehold Land Prepayments	0.36	0.36
	Balance with Government Authorities	1178.34	1442.43
	Prepaid (Deffered)Expenses for Employee Benefit	-	-
	Advance Income Tax - Tax Deducted at source	0.48	0.45
	Security Deposits	77.10	23.64
	Export Incentives Receivable	668.63	403.87
	Recoverable from Customs	-	69.27
	Advances to Employees	80.89	88.13
	Prepaid Expenses	90.31	78.14
		3863.10	3797.08
	Advances Considered Doubtful	163.60	159.56
	Less : Provision for doubtful advances	(163.60)	(159.56)
		3863.10	3797.08

12. SHARE CAPITAL

A. Equity Share Capital

	As at March 31, 2019		As at March 31, 2018
	No.	Amount	No.	Amount
	of Shares	(/Lakhs) | of Shares | (/Lakhs)
Authorised
Equity Shares of ` 2/- each	450000000	9000.00	450000000	9000.00
Issued and Subscribed
Equity Shares of ` 2/- each	449826203	8996.53	449826203	8996.53
Paid up
Equity Shares of ` 2/- each	449826203	8995.86	449826203	8995.86

Reconcilation of the numbers and amount of Equity shares -

For the year ended	As at March 31, 2019		As at March 31, 2018
	No. of Shares	Amount (/Lakhs) | No.<br>of Shares | Amount<br>(/Lakhs)
Outstanding at beginning of the year	449826203	8995.86	449826203	8995.86
Add : Shares issued during the year	-	-	-	-
Less : Shares bought back during the year	-	-	-	-
Outstanding at the end of year	449826203	8995.86	449826203	8995.86

B. Shareholders holding more than 5% shares -

Equity Shares

Name of Shareholder	As at March 31, 2019		As at March 31, 2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Pinfold Overseas Ltd.	38530000	8.57	38530000	8.57

C. Rights, preferences and restrictions attached to each class of Shares and terms of redemption -

• i) The company has equity shares having a par value of ` 2/- each. Every member of the Company holding equity shares shall be entitled to vote on every resolution placed before the Company and their voting right on poll shall be in proportion to their share in the paid-up equity share capital of the Company.
• ii) In the event of liquidation of the company, the holders of equity shares will be entitled to receive the remaining assets of the company after distribution of preferential amounts. The distribution will be in the proportion of the number of equity shares held by the shareholders.
• D. During last 5 years immediately preeceding the balance sheet date, no Equity Share has been issued pursuant to any contract without payment being received in cash. Further the company has neither allotted any share by way of bonus shares, nor it had bought back any Equity during aforesaid period of 5 years.

E. Disclosure about unpaid calls - (` in Lakhs)

Unpaid Calls	31.03.2019	31.03.2018
By Directors & Officers	-	-
By Others	0.66	0.66

F. No shares have been forfeited by the company during the year.

		(` in Lakhs)
	As at	As at
	31.03.2019	31.03.2018
13. MINORITY INTEREST
Share Capital	46.66	46.66
Share in Profit/(Loss)	(92.97)	(92.08)
	(46.31)	(45.42)

14. BORROWINGS

Long Term

	Current Portion			Non Current Portion
	As at 31.03.19	As at 31.03.18	As at 31.03.19	As at 31.03.18
Secured
Term Loans from Banks & Institutions
Restructured Debts	-	1053.95	-	-
Other Loans	112.50	107.75	182.92	294.73
Preference Shares (Refer note no. 19)	11965.20	11965.20	-	-
	12077.70	13126.90	182.92	294.73

14875.81 15576.77

I. Term Loans from Banks & Institutions

Other loans represent vehicle loans, repayble on monthly basis, are secured by way of hypothecation of specific assets purchased under the hire purchase scheme.

	Year of Repayment		2020-21	2021-22		2022-23	Total
	Annual Repayment Amount (Rs./Lakhs)		99.89		48.35	34.68	182.92
	Annual Rate of Interest (%)	8.17 - 11.00		8.17 - 11.00		8.17 - 11.00
							(` in Lakhs)
						As at	As at
						31.03.2019	31.03.2018
	II. Current Portion of Long Term Borrowings is appearing under the head Other Financial Liabilities. (Refer Note No. 18)
	Short Term
	Secured
	Bank Overdraft and Bill Discounting facility against term deposit (Refer Note No. 9)					898.87	-
	Total					898.87	-
	Annual rate of interest chargable on aforesaid facilties ranges up to 8.5%.
15.	OTHER FINANCIAL LIABILITIES (NON-CURRENT)					253.65	282.66
	Security Deposits from Business Associates & Others					253.65	282.66
16.	PROVISIONS
			CURRENT			NON-CURRENT
	Provision for employees' benefits (Unfunded) -	As at 31.03.19		As at 31.03.18		As at 31.03.19	As at 31.03.18
	Gratuity	89.76		76.56		1405.23	1088.31
	Leave Encashment	31.63		56.77		495.98	354.06
	Provision for Income Tax	17.21		-		-	-
		138.60		133.33		1901.21	1442.37
17.	TRADE PAYABLES
	Total outstanding dues of micro small and medium enterprises					392.75	38.88
	Total outstanding dues of creditors other than
	micro small and medium enterprises					16422.27	17449.56
						16815.02	17488.44
	Further, no interest during the year has been paid or payable under the terms of the MSMED Act, 2006.
18.	OTHER FINANCIAL LIABILITIES -CURRENT
	Current maturities of Long Term Borrowings (Refer note no. 15)					112.50	1161.70
	Preference Shares (Refer note no. 15)					11965.20	11965.20
	Interest accrued and due on borrowings					-	65.12
	Cummulative Dividend on Preference Shares					881.32	831.69
	Accrued salaries and benefits					1175.54	896.69
	Others					741.25	656.37

Under the previous GAAP, Preference Shares Capital was treated as part of equity and carried at cost. Redeemable preference shares contain a contractual obligation to deliver cash to the holders. Under Ind As the same is classified as liability. Dividend on cumulative preference shares has accordingly shown as part of finance cost.

A. Preference Share Capital

	As at March 31, 2019			As at March 31, 2018
	Nos.	Amount	Nos.	Amount
	of Shares	(/Lakhs) | of Shares | (/Lakhs)
Authorised
Preference Shares of ` 100/- each	12000000	12000.00	12000000	12000.00
Issued , Subscribed & paid up
Preference Shares of ` 100/- each	11965201	11965.20	11965201	11965.20
0.01% Optionally Convertible	9735201	9735.20	9735201	9735.20
0.01% Cumulative Redeemable	1730000	1730.00	1730000	1730.00
9.75% Cumulative Redeemable	500000	500.00	500000	500.00
	11965201	11965.20	11965201	11965.20

Reconcilation of the numbers and amount of Preference shares

	As at March 31, 2019		As at March 31, 2018
	Nos. of Shares	Amount (/Lakhs) | Nos.<br>of Shares | Amount<br>(/Lakhs)
Outstanding at beginning of the year	11965201	11965.20	11965201	11965.20
Add : Shares issued during the year	-	-	-	-
Less : Shares bought back during the year	-	-	-	-
Outstanding at the end of year	11965201	11965.20	11965201	11965.20
Total Equity (`/Lakhs)		20961.06		20961.06

B. Rights, preferences and restrictions attached to each class of Shares and terms of redemption -

• a) i) The company has preference shares of ` 100/- each. Every member of the Company holding preference shares shall be entitled to vote on resolutions placed before the Company which directly affect the rights attached to their shares and any resolution for winding up of the Company or for repayment or reduction of capital and their voting right on poll shall be in proportion to their share in the paid-up preference share capital of the Company. However, where the dividend in respect of a class of preference shares has not been paid for a period of two years or more, such class of preference shareholders shall have a right to vote on all resolutions placed before the Company and the proportion of voting rights of equity shareholders to the voting rights of preference shareholders shall be in proportion to their paid up capital.
• ii) In the event of liquidation of the company, the holders of equity shares will be entitled to receive the remaining assets of the company after distribution of preferential amounts. The distribution will be in the proportion of the number of equity shares held by the shareholders.

• b) i) All 9735201, 0.01% Optionally Convertible Preference Shares, had already become due for redemption/conversion in the financial year 2014-15 and could not be redeemed due to unavailability of surplus.

• ii) Out of 1730000, 0.01% Cumulative Reedemable Preference Shares, preference shares comprising of 200000 Shares amounting to 200.00 Lakhs were due for redemption in financial year ending 31.03.2012, whereas 50% of st 1530000 Shares amounting to 765.00 Lakhs were due for redemption in the financial year ending 31 March, st 2017 and balance 50% had fallen due for redemption in the financial year ending 31 March, 2018.

• iii) 500000, 9.75% Cumulative redeemable Preference shares amounting to `500.00 Lakhs had been due for redemption since March 2004, however, could not be redeemed because of unavailability of surplus. The subscriber has filed a legal case against the company for the recovery of the sum invested as well as dividend thereon. The company is contesting the claim of the subscriber at appropriate forum.
• iv) During the year, the company could not redeem the Preference Shares, already due for redemption, on account unavailability of distributable profits in terms of Section 55(2)(a) and Section 123 of Companies Act, 2013.

Preference Shares

Name of Shareholder	As at 31.03.2019		As at 31.03.2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Bank of Nova Scotia	1179000	12.11	1179000	12.11
Stressed Assets Stabilisation Fund (SASF)	961044	9.87	961044	9.87
EXIM Bank Ltd.	916333	9.41	916333	9.41
SICOM Ltd.	829463	8.52	829463	8.52
Punjab National Bank	671522	6.90	671522	6.90
Oriental Bank of Commerce	623828	6.41	623828	6.41
Dena Bank	593936	6.10	593936	6.10
UCO Bank	515900	5.30	515900	5.30

a) 9735201, 0.01% Optionally Convertible Redeemable Shares -

b) 1730000, 0.01% Cummulative Redeemable Shares -

Name of Shareholder		As at 31.03.2019	As at 31.03.2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Oriental Bank of Commerce	1000000	57.80	1000000	57.80
Axis Bank Ltd.	500000	28.90	500000	28.90
Blue Sky Securities Pvt. Ltd.	200000	11.56	200000	11.56

c) 500000, 9.75% Cumulative Redeemable Shares -

Name of Shareholder	As at 31.03.2019		As at 31.03.2018
	No. of Shares	% of Holding	No. of Shares	% of Holding
Jammu and Kashmir Bank Ltd.	500000	100	500000	100

(` in Lakhs)
As at
31.03.2018
239.89 271.13
302.23 65.77
211.47 41.70
435.00 435.00
1188.59 813.60
As at 31.03.2019

* Advance against sale of Fixed Assets

Advance against the sale of fixed assets represents amount received for the sale of land apperaing in Note no. 2 (b) of notes on financial statements under the head Fixed Assets.

20. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

a) Contingent Liabilties

	Claim against the Company not acknowledged as debts	218.33	844.50
	Guarantees	32.65	22.69
	Other money for which company is contingently liable	901.50	1740.00
	Fixed Deposits (Refer Note No. 33(d))	-	-
		1152.48	2607.19
b)	Commitments	-	-
		1152.48	2607.19

	(` in Lakhs)
Year Ended	Year Ended
31.03.2019	31.03.2018

21. REVENUE FROM OPERATIONS

	Sale of Products
	Domestic	45924.98	41408.98
	Exports	29696.46	18366.31
		75621.44	59775.29
	Other Operating Revenues
	Export Incentives	1093.59	777.32
	Others	138.81	98.30
		1232.40	875.62
		76853.84	60650.91
22.	OTHER INCOME
	Interest Income	82.23	12.05
	Others	284.95	360.22
		367.18	372.27

			(` in Lakhs)
		Year Ended	Year Ended
		31.03.2019	31.03.2018
23.	COST OF MATERIALS CONSUMED
	Raw Materials	32570.03	21323.68
	Packing Materials	1738.06	728.97
		34308.09	22052.65
24.	EMPLOYEE BENEFITS EXPENSE
	Salaries and Wages	8515.20	6798.40
	Contribution to provident fund/ ESI	331.50	301.14
	Gratuity and Leave Encashment Expenses	362.65	236.76
	Staff Welfare	327.12	317.07
		9536.47	7653.37
25.	FINANCE COST
	Interest expense	161.37	386.98
	Dividends on Cumulative Preference Shares (refer Note No. 19)	49.63	48.75
		211.00	435.73
26.	OTHER EXPENSES
	Consumption of Stores and spare parts	236.29	112.65
	Power and Fuel	1318.15	1108.29
	Rent	417.03	414.07
	Repairs to buildings	179.37	120.62
	Repairs to machinery	437.95	305.57
	General Repairs	93.71	101.16
	Insurance	58.88	56.31
	Research & Development	95.86	50.42
	Quality Control & Testing Charges	440.96	303.22
	Rates and taxes excluding taxes on income	141.34	138.21
	Legal and Professional Expenses	1470.20	898.06
	Travelling Expenses	1432.73	1244.29
	Miscellaneous Expenses	1320.12	1811.13
	Selling and Distribution Expenses	3273.22	3003.68
		10915.81	9667.69

27. PRIOR PERIOD ITEMS

Expenses include 42.03 Lakhs (Previous Year 14.73 Lakhs) as expenses (net) relating to earlier years.

28. SEGMENT REPORTING

In accordance with Ind AS-108, "Operating Segment " the Company's business activity falls within a single primary business segment viz. "Pharmaceuticals". The secondary business segment in terms of geographical markets have been recognised as India, USA and rest of world. The segment revenues for the year is as under-

Geographical Segment		Sales Revenue (`/Lakhs)
	2018-19	2017-18
USA	4279.75	3921.38
Rest of World	25416.71	14444.93
India	45924.98	41408.98
Total	75621.44	59775.29

29. RELATED PARTY DISCLOSURES

Disclosure as required by Indian Accounting Standard "Related Party Disclosures" (Ind AS 24) issued by the Institute of Chartered Accountants of India are as under:

	Related Parties
1.	Key Management Personnel	Morepen Laboratories Limited -
		Mr. Sushil Suri, Chairman & Managing Director,
		Dr. A.K. Sinha, Whole time Director
		Mr. Ajay Sharma, Chief Financial Officer
		Mr. Vipul Srivastava, Company Secretary from November 2018
		Mr. Thomas P. Joshua, Company Secretary upto September 2018
		Dr. Morepen Limited -
		Mr. Sanjay Suri, MD
		Mr. Ajay Sharma, Director & Chief Financial Officer
		Mr. Deepak Das, Company Secretary
2.	Entities over which key management personnel/	Park Hyatt Goa Resort and Spa (a unit of Blue Coast Hotels Ltd.)
	or Relatives of key management personnel are able to exercise significant influence with which the company has any transactions during the year	Edit 25 Lifestyle Private Limited
3.	Relatives of Key Management personnnels with whom the company has any transaction during the year	Mr. Varun Suri, Mr. Anubhav Suri, Mr. Kushal Suri, Mrs. Sunita Suri, Mrs. Mamta Suri, Mrs. Shalu Suri, Mrs. Sakshi Suri, Mrs. Suhina Suri, Mrs. Bavleen Suri, Mr. Rajas Suri, Mrs. Amita Sharma

Transactions with related parties -

	Particulars	Nature of transaction	(` in Lakhs)
1.	Key Management Personnel	Remunertion	378.02
		Payable Balance as on 31.03.19	54.97
		(Maximum amount outstanding ` 75.14 Lakhs)
2.	Entities over which key management personnel/ or Relatives of key management	Balance Payable as on 31.03.19 (Maximum amount outstanding - `158.46 Lakhs)	Nil
	personnel are able to exercise significant	Receipt of services	34.48
	influence with which the company has any transactions during the year	Balance Payable as on 31.03.19 (Maximum amount outstanding - ` 13.30 Lakhs)	4.07
3.	Relatives of key Management personnnels	Remuneration	424.96
	with whom the company has any transaction during the year	Payable Balance as on 31.03.19 (Maximum amount outstanding - ` 149.39 Lakhs)	137.13

30. EARNING PER SHARE (EPS)

Particulars	31.03.2019	31.03.2018
Profit/ (Loss) after Tax (` in Lacs)	2884.93	2959.14
Weighted average number of equity shares outstanding	449826203	449826203
Earnings/(loss) per share in rupees (face value ` 2/- per share)	0.64	0.66

31. IMPAIRMENT

st It is the view of management that there are no impairment conditions that exist as on 31 March, 2019. Hence, no provision is required in the accounts for the year under review.

32. TAXES

As required by Indian Accounting Standard "Income - taxes" i.e. (Ind-AS 12) issued by the Institute of Chartered Accountants of India, deferred tax asset on accumulated losses, is not recognized as a matter of prudence. Current year income tax is provided as per the provisionss of Income Tax Act, 1961.

33. OTHERS SIGNIFICANT DISCLOSURES

• a) In the opinion of directors, all assets stated otherwise have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated in the books of accounts and the provision for depreciation and for all known liabilities is adequate and considered reasonable.
• b) Balances of Non-current liabilities, Current liabilties, Long terms loans and advances, Trade receivables, Short term loans and advances and banks are subject to confirmation.
• c) Sales Tax assessments for earlier years are in progress. Demand, if any, shall be known & accounted for, on the completion of assessments.
• st d) During the financial year ended 31 March, 2010, pursuant to a Scheme of Arrangement & Compromise under Section 391 th of the Companies Act, 1956 approved by the Hon'ble High Court of Himachal Pradesh vide its Order dated 4 August, 2009 the Company allotted 9,24,90,413 Equity Shares to the fixed deposit holders in settlement of their dues. On an appeal filed against the said Order by the Central Government, the Hon'ble Division Bench of the Hon'ble High Court of Himachal Pradesh remanded the matter back to single judge for considering the representation of central government and deciding the matter afresh. The matter was later transferred to Hon'ble National Company Law Tribunal (NCLT), th Chandigarh. The Hon'ble NCLT vide its judgment dated 12 March, 2018 dismissed the Company's petition seeking approval of the Scheme of arrangement with the Fixed Deposit holders. However, Hon'ble NCLT further stated that the order will not affect the allotment of the shares to the FD holders who have traded the shares to the third parties or transferred the allotted shares. It directed the company that it shall pay the outstanding amount as per the scheme approved by the Company Law Board (CLB) to the original FD holders (except to those who have since traded/transferred the shares allotted to them). The Company had filed an appeal before the Hon'ble National Company Law Appellate Tribunal th (NCLAT) at New Delhi against the order dated 12 March, 2018 of the Hon'ble NCLT, Chandigarh. The Hon'ble NCLAT th while issuing notice to the respondents has stayed the operation of the impugned order dated 12 March, 2018. The Hon'ble National Company Law Appellate Tribunal (NCLAT) after hearing the matter has reserved the order for judgment. Pending disposal of the company's appeal before Hon'ble NCLAT, the liability towards deposit holders, if any, is not ascertained. (Refer Note. No. 20)
• e) In view of the amendments in the Companies Act during the year, the payment of remuneration to directors amounting to Rs. 356.00 Lakhs for the period April 2005 - March 2014, now does not require approval from central government.
• f) During the year operations u/s 132 of Income Tax Act, 1961 were carried out by Income Tax Department on the premises of the company. No incriminating document was found.
• g) Previous year figures have been regrouped and rearranged wherever necessary to suit the present year layout.

34. Corporate Social Responsibility (CSR)

• st a) During the financial year ended 31 March, 2019, CSR amount required to be spent by the Company as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof was 43.15 Lakh (Previous year 26.18 Lakh).
• b) During the year the Company has made an expenditure of 45.06 Lakh (Previous year 31.80 Lakh) related to CSR.
• st c) Details of CSR expenditure incurred during the year ended 31 March, 2019 is as below :-

		(` in Lakhs)
--	--	--------------	--

	31.03.2019	31.03.2018
CSR activity
- Promotion of Healthcare	32.55	31.80
- Education	12.51	-
Total	45.06	31.80

MOREPEN LABORATORIES LIMITED

Regd. Off: Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, H.P.- 173 205 CIN: L24231HP1984PLC006028; Website: www.morepen.com; E-mail Id: investors@morepen.com; Tel No.: +91-01795-276201-03; Fax No.: +91-01795-276204

NOTICE

th NOTICE is hereby given that the 34 Annual General Meeting ('AGM') of the members of Morepen Laboratories Limited will be th held on Friday, 13 of September, 2019 at 10.00 A.M. at the Registered Office of the Company at Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh - 173 205, to transact the following business:

ORDINARY BUSINESS

• 1. To receive, consider and adopt the Audited Financial Statement, including Consolidated Financial Statements, of the Company st for the financial year ended 31 March, 2019 together with the reports of the Directors' and Auditors' thereon.
• 2. To appoint a Director in place of Mrs. Anju Suri (DIN: 00042033), who retires by rotation at this Annual General Meeting and being eligible, offers herself for re-appointment.

SPECIAL BUSINESS

3. Increase in remuneration of Mr. Sushil Suri (DIN: 00012028), Chairman & Managing Director of the Company

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of Section 196, 197 read with Schedule V and other applicable provisions, if any, of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof, for the time being in force), approval of the members be and is hereby accorded to payment of such remuneration to Mr. Sushil Suri (DIN: 00012028), Chairman & Managing Director of the st Company with effect from 1 April, 2019, as set out in the statement annexed to the Notice convening this Meeting with the liberty to the Board of Directors (hereinafter referred to as "the Board" which term shall be deemed to include any Committee of the Board constituted to exercise its powers, including the powers conferred by this resolution) to alter and vary the said terms and conditions of appointment and / or remuneration, pursuant to provisions of the Companies Act, 2013 or any statutory modification(s) or re-enactment thereof;

RESOLVED FURTHER THAT the Board be and is hereby authorised to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution."

4. Re-appointment of Dr. Arun Kumar Sinha (DIN: 00450783) as a Whole-Time Director of the Company

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of Section 196, 197 and 203 and other applicable provisions, if any, of the Companies Act, 2013 ("Act") read with Schedule V and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s) or re-enactment thereof, for the time being in force), approval of the Company be and is hereby accorded for the re-appointment of Dr. Arun Kumar Sinha (DIN: 00450783) as a Whole-Time Director (designated as Director - Technical) of the Company, liable to retire by rotation, to hold office for a term of 3 (three) st st consecutive years with effect from 1 April, 2019 up-to 31 March, 2022 on the terms and conditions as specified in the statement pursuant to Section 102 of the Act annexed to this Notice and on the remuneration, which is as follows:

S. No.	Particulars	Amount (Rs.)
1.	Basic Pay	Upto ` 2,00,000 per month.
2.	Perquisites & Allowances	Upto ` 1,50,000 per month.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution."

5. Re-appointment of Mr. Sukhcharan Singh (DIN: 00041987) as an Independent Director of the Company

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of Section 149, 152 and other applicable provisions, if any, of the Companies Act, 2013 ("Act") and the Rules framed thereunder, read with Schedule IV to the Act (including any statutory modification(s) or reenactment thereof, for the time being in force) and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, ("SEBI (LODR) Regulations") as in force and subject to other applicable rules, regulations and guidelines of Securities and Exchange Board of India ("SEBI"), Mr. Sukhcharan Singh (DIN: 00041987), a Non-Executive Independent Director of the Company, who has submitted a declaration that he meets the criteria for independence as provided in Section 149(6) of the Act and who is eligible for re-appointment, be and is hereby appointed as an Independent Director of the Company, not liable to retire by rotation, to hold office for an another term of 5 (five) consecutive years with effect th th from 19 September, 2019 upto 18 September, 2024.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution."

6. Re-appointment of Mr. Manoj Joshi (DIN: 00036546) as an Independent Director of the Company

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of Section 149, 152 and other applicable provisions, if any, of the Companies Act, 2013 ("Act") and the Rules framed thereunder, read with Schedule IV to the Act (including any statutory modification(s) or reenactment thereof, for the time being in force) and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, ("SEBI (LODR) Regulations") as in force and subject to other applicable rules, regulations and guidelines of Securities and Exchange Board of India ("SEBI"), Mr. Manoj Joshi (DIN: 00036546), a Non-Executive Independent Director of the Company, who has submitted a declaration that he meets the criteria for independence as provided in Section 149(6) of the Act and who is eligible for re-appointment, be and is hereby appointed as an Independent Director of the Company, not liable to retire by rotation, to hold office for an another term of 5 (five) consecutive years with effect th th from 19 September, 2019 upto 18 September, 2024.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution."

7. Re-appointment of Mr. Bhupender Raj Wadhwa (DIN: 00012096) as an Independent Director of the Company

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of Section 149, 152 and other applicable provisions, if any, of the Companies Act, 2013 ("Act") and the Rules framed thereunder, read with Schedule IV to the Act (including any statutory modification(s) or reenactment thereof, for the time being in force) and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, ("SEBI (LODR) Regulations") as in force and subject to other applicable rules, regulations and guidelines of Securities and Exchange Board of India ("SEBI"), Mr. Bhupender Raj Wadhwa (DIN: 00012096), a Non-Executive Independent Director of the Company, who has submitted a declaration that he meets the criteria for independence as provided in Section 149(6) of the Act and who is eligible for re-appointment, be and is hereby appointed as an Independent Director of the Company, not liable to retire by rotation, to hold office for an another term of 5 (five) consecutive th th years with effect from 19 September, 2019 upto 18 September, 2024.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution."

8. Maintenance of Register of Members and other Statutory Registers at a place other than Registered Office of the Company

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of Section 94 read with Section 88, Section 92 and other applicable provisions, if any, of the Companies Act, 2013 and the rules made there under, the consent of the members of the Company be and is hereby accorded to keep, maintain and preserve Register of Members and Index of Members of the Company and other Statutory Registers, copies of all annual returns, copies of certificates and documents required to be annexed thereto, at the Corporate

th Office of Morepen Laboratories Limited ('the Company'), situated at 4 , Floor, Antriksh Bhawan, 22 Kasturba Gandhi Marg, New Delhi-110001, apart from keeping and maintaining the same at Registered Office of the Company.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution."

9. Increase in the limits of Loan and Investment under Section 186(3) of the Companies act, 2013

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT in supersession of the earlier member's resolution passed , pursuant to the provisions of Section 186(3) and all other applicable provisions, if any, of the Companies Act, 2013 (the 'Act'), and the Companies (Meetings of Board and its Powers) Rules, 2014 and other Rules, Regulations, Notifications and Circulars framed thereunder including any statutory modification or re-enactment thereof for the time being in force, and such other approvals as may be required in that behalf, the consent of the Company be and is hereby accorded to the Board of Directors of the Company (hereinafter referred to as 'the Board' which term shall be deemed to include any Committee which the Board may have constituted or may hereinafter constitute to exercise its powers including the powers conferred by this Resolution) to:

• give loans from time to time on such terms and conditions as it may deem expedient to any person or other bodies corporate;
• give on behalf of any person or body corporate, any guarantee, or provide security in connection with a loan made by any other person or by any body corporate; and
• acquire by way of subscription, purchase or otherwise the securities of any other body corporate,

in excess of the limits prescribed under Section 186 of the Act up to an aggregate sum of ` 5,00,00,00,000 (Rupees Five Hundred Crores Only) notwithstanding that the aggregate of loans and investments so far made, the amounts for which guarantee or security so far provided, along with the investments, loans, guarantee or security proposed to be made or given by the Board may exceed sixty per cent of its paid-up share capital, free reserves and securities premium account or one hundred per cent of its free reserves and securities premium account, whichever is more.

FURTHER RESOLVED THAT the consent of the Company be and is hereby accorded to the Board to invest in the Subsidiaries, Associates, Related Parties, give loans to them; provide guarantees / security on their behalf, to any person or body corporate, within the limits, if any, as may be applicable from time to time and on such terms and conditions as may be deemed fit and expedient.

FURTHER RESOLVED THAT the Board be and is hereby authorised to negotiate the terms and conditions of the above said investment(s), loan(s), security(ies) or guarantee(s) as they deem fit and in the best interest of the Company and take all such steps as may be necessary to complete the same.

FURTHER RESOLVED THAT the Board be and is hereby authorised to do all such acts, deeds, matters and things as it may, in its absolute discretion, deem necessary and with power to settle questions, difficulties or doubts that may arise in this regard without requiring the Board to secure any further approval of the Members of the Company."

10. Authorization for borrowings under Section 180 (1) (c) of the Companies Act, 2013

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT in supersession of the earlier member's resolution passed, pursuant to provisions of Section 180 (1)(c) and other applicable provisions of the Companies Act, 2013 along with rules made thereunder, Memorandum and Articles of Association of the Company, the consent of the Company be and is hereby accorded to the Board of Directors of the Company including any committee thereof for borrowing monies, from time to time, at its discretion either from the Company's bankers or any other bank(s), financial institutions(s), international lending agencies or any other lending institution(s), persons, firms, trusts or bodies corporate by way of deposits, advances or other loans, convertible/non-convertible debentures, commercial papers, bonds or any other debts instruments, whether unsecured or secured directly by mortgage, charge, hypothecation or pledge of any of the Company's assets and properties, book debts or by collateral security thereon or on such terms and conditions as may be considered suitable by the Board of Directors, even though the monies to be borrowed together with monies already borrowed by the company, apart from temporary loans obtained from Company's Bankers in the ordinary course of business, exceeds the aggregate paid-up capital of the Company and its free reserves i.e., reserves not set apart for any specific purpose provided, however, that the total amount of such borrowings shall not exceed the amount of ` 12,00,00,00,000/- (Rupees One Thousand Two Hundred Crores Only) at any time.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to do all such acts, deeds, matters and things as may be necessary and expedient and also to delegate all or any of the above powers to the committee of Directors or any other officers of the Company for giving effect to the above resolution."

11. Creation of charge on assets under Section 180 (1) (a) of the Companies Act, 2013

To consider and if thought fit, to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT in supersession of the earlier member's resolution passed, pursuant to the provisions of Section 180(1)(a) and other applicable provisions, if any, of the Companies Act, 2013 (including any statutory modification or re-enactments thereof) and rules made thereunder, the consent of the members be and is hereby accorded to the Board of Directors of the Company to mortgage and /or charge, in addition to the mortgages/charges created/to be created by the Company in such form and manner and with such ranking and at such time and on such terms as the Board may determine, on all or any of the moveable and/ or immovable properties of the Company, both present and future and/or the whole or any part of the undertaking(s) of the Company and together with the power to take over the management of business and concern of the Company in certain events of default, in favour of the lender(s), agent(s), trustee(s) for securing the borrowing of the Company availed/to be availed by the way of loan(s) (in foreign currency and/or in rupee currency) and securities (comprising of fully/partly convertible debentures/ nonconvertible debentures and/or commercial papers and/or secured premium notes and/or floating rates notes/ bonds or other debt instruments), issue/to be issued by the Company, from time to time, in one or more tranches, upto an aggregate limit of ` 12,00,00,00,000/- (Rupees One Thousand Two Hundred Crores Only) as approved under Section 180 (1)(c) of the Companies Act, 2013 together with interest at the respective agreed rates, additional interest in case of default, accumulated interest, liquidation damages, commitment charges, premia on repayment, remuneration of the agent(s) and/or trustee(s), premium (if any) on redemption, all other costs, charges and expenses, including any increase as result of devaluation/ revaluation/ fluctuation in the rates of exchange and all other monies payable by the Company in terms of the respective loan agreement(s), heads of agreement(s), debenture trust deed(s) or any other document entered into/to be entered into between the Company and the lender(s)/investor(s)/agent(s) and/or trustee(s) in respect of the said loans/ borrowings/any other securities and continuing such specific terms and conditions and covenants in respect of enforcement of security as may be stipulated in that behalf and agreed to between the Board of Directors or any committees thereof and the lender(s), agent(s) and/or trustee(s).

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to finalise the documents and such other agreements for creation of charge as aforesaid any to do all such acts, deeds, matters and things as may be necessary and expedient for giving effect to the above resolution."

12. Ratification of remuneration of M/s. Vijender Sharma & Co., Cost Accountants, as Cost Auditors of the Company

To consider and if thought fit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution:

"RESOLVED THAT pursuant to the provisions of Section 148 and all other applicable provisions of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014, including any statutory modification(s) or re-enactment thereof, for the time being in force and as per the recommendation of the Audit Committee, the Company hereby ratifies the remuneration of M/s. Vijender Sharma & Co., Cost Accountants, (FRN: 000180), appointed as Cost Auditors of the Company by the Board of Directors of the Company, to audit the cost records relating to manufacturing of Bulk Drugs and Formulations for the financial year 2019-2020, at a remuneration of ` 2,00,000/- excluding applicable taxes and out of pocket expenses.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to do all acts and take all such steps as may be necessary, proper or expedient to give effect to this resolution."

By order of the Board of Directors For Morepen Laboratories Limited

Place: New Delhi th Date: 27 July, 2019

CIN: L24231HP1984PLC006028

Sushil Suri (Chairman & Managing Director) DIN: 00012028

NOTES:

• 1. The Statement pursuant to Section 102 of the Companies Act, 2013 ('Act') with respect to the special business set out under Item Nos. 3 & 12 of the Notice, is annexed hereto and forms part of the notice.
• 1. The relevant details, as required under Secretarial Standard 2 and Regulation 36 of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015 ('SEBI (LODR) Regulations'), as amended, of persons seeking appointment/re-appointment as Director at the Annual General Meeting ('AGM') are furnished herewith and forms part of the Notice.

3. A MEMBER ENTITLED TO ATTEND THE MEETING AND VOTE THERE AT IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER OF THE COMPANY.

Pursuant to the provisions of Section 105 of the Companies Act, 2013, a person can act as a proxy on behalf of not more than fifty (50) members and holding in the aggregate not more than ten percent (10%) of the total Share Capital of the Company carrying voting rights. A member holding more than ten percent (10%) of the total Share Capital of the Company carrying voting rights may appoint a single person as proxy and such person shall not act as proxy for any other member.

The instrument appointing proxies, in order to be effective, should be duly stamped, completed and signed and should be deposited at the Registered Office of the Company not less than 48 hours before the commencement of the meeting.

• 1. Corporate members intending to send their authorized representatives to attend the meeting are requested to send, to the Company, a certified copy of the Board Resolution authorizing their representative to attend and vote on their behalf at the meeting.
• th 5. The Register of Members and Share Transfer Books of the Company will remain closed from Saturday, 7 September, 2019 to th Friday, 13 September, 2019 (both days inclusive).
• 1. Members/Proxies should bring the Attendance Slip sent herewith, duly filled in and signed, for attending the meeting.
• 1. The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) by every participant in securities market. Members holding shares in electronic form are, therefore requested to submit their PAN to their Depository Participants with whom they are maintaining their de-mat accounts. Members holding shares in physical form can submit their PAN to the RTA of the Company (i.e., 'MAS Services Limited').
• 1. As per Regulation 40 of SEBI (LODR) Regulations, as amended, securities of listed companies can be transferred only in st dematerialized form with effect from 1 April, 2019, except in case of request received for transmission or transposition of securities. In view of this and to eliminate all risks associated with physical shares and for ease of portfolio management, members holding shares in physical form are requested to consider converting their holdings to dematerialized form. Members can contact the Company or Company's Registrars and Transfer Agents, MAS Services Limited for assistance in this regard.
• 1. Members who hold shares in physical form in multiple folios in identical names or joint holding in the same order of names are requested to send the share certificates to MAS Services Limited, for consolidation into a single folio.
• nd nd 10. At the 32 AGM held on 22 September, 2017 the members approved appointment of M/s. Satinder Goyal & Co., Chartered Accountants (FRN: 027334N) as Statutory Auditors of the Company to hold office for a period of five years from the conclusion of th that AGM till the conclusion of the 37 AGM, subject to ratification of their appointment by Members at every AGM, if so required under the Act. The requirement to place the matter relating to appointment of auditors for ratification by Members at th every AGM has been done away by the Companies (Amendment) Act, 2017 with effect from 7 May, 2018. Accordingly, no th resolution is being proposed for ratification of appointment of Statutory Auditors at the 34 AGM.
• 1. Pursuant to Section 110(1)(a) read with Secretarial Standards 2 of ICSI, resolutions proposed in item no. 09 and 11 shall be th passed through postal ballot. However, the Companies (Amendment) Act, 2017, w.e.f., 08 February, 2018, business required to be transacted by means of postal ballot under clause 110(1)(a), may be transacted at a general meeting by the company which is required to provide the facility to members to vote by electronic means under section 108, in the manner provided in that section. The Company is providing e-voting facilities to the members, therefore, resolution as set out in item no. 09 and 11 are th proposed for approval of members in 34 Annual General Meeting.
• 1. To support the 'Green Initiative', the Members are requested to register/update their e-mail id's, contact details and addresses with the RTA 'MAS Services Limited'/Depositories for receiving all communications including Annual Report, Notices, Circulars, etc., from the Company electronically.

• th 13. The Notice of the 34 AGM along with the Annual Report 2018-19 is being sent by electronic mode to those Members whose e-mail addresses are registered with the Company/ Depositories, unless any Member has requested for a physical copy of the same. For Members who have not registered their e-mail addresses, physical copies are being sent by the permitted mode.
• th 14. Members may also note that the Notice of 34 AGM and the Annual Report for financial year 2018-19 will be available on Company's website, www.morepen.com. The physical copies of the aforesaid documents will also be available at the Company's registered office for inspection during normal business hours on working days. Members who have any queries may write to us at investors@morepen.com.
• 1. The Auditors Report pursuant to Section 145 of the Companies Act, 2013, Register of Directors & Key Managerial Personnel and their Shareholdings pursuant to Section 170, Register of Contracts or Arrangements in which Directors are interested pursuant to Section 189 and the Register of Proxies, will be available for inspection by the members at the AGM.
• th 16. Route Map showing directions to reach the venue of 34 AGM is given at the end of this Notice.
• 1. Pursuant to the provisions of Section 108 of the Act read with Rule 20 of the Companies (Management and Administration) Rules, 2014, as amended by the Companies (Management and Administration) Amendment Rules, 2015 and Regulation 44 of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Company is pleased to provide to its members th the facility to exercise their right to vote, on all the resolutions set forth in the Notice of 34 AGM of the Company, by electronic means through the remote e-voting services provided by National Securities Depository Limited (NSDL).

The Members, whose name appear in the Register of Members, holding shares in physical or in dematerialised form, as on the th cut-off date i.e., Friday, 6 September, 2019 (end of day), including those preference shareholders whose dividends have remained unpaid for more than two years, are entitled to cast their votes on the resolutions set forth in this Notice.

The members may cast their votes using an electronic voting system from a place other than the venue of the Meeting ('remote th e-voting'). The remote e-voting shall commence at 9.00 a.m. on Monday, 9 September, 2019 and shall end at 5.00 p.m. on th Thursday, 12 September, 2019.

In addition, the facility for voting by use of 'Ballot Paper' shall also be made available at the AGM, for all those members who are present at the AGM but have not cast their votes by remote e-voting.

The members desirous to vote through remote e-voting are requested to refer to the detailed procedure given hereinafter.

Procedure for Remote E-voting:

The Company has entered into an arrangement with National Securities Depository Limited (NSDL) for facilitation of remote e-voting for AGM. The instructions for remote e-voting are as under:

(a) In case of members receiving e-mail from NSDL:

• i) Open the PDF file 'Morepen remote e-Voting.pdf' attached to the email, using your Client Id/ Folio No. as password. The PDF file contains your User Id and Password for remote e-voting. Please note that the password provided in PDF file is 'Initial Password'.
• ii) Launch internet browser and open https://www.evoting.nsdl.com/.
• iii) Click on Shareholder Login.
• iv) If you are already registered with NSDL for remote e-voting, then you can use your existing User Id and Password/PIN for casting your vote.
• v) If you are logging in for the first time, please enter the 'User Id' and 'Initial Password' as noted in step (i) above and click on 'Login'.
• vi) Password change menu will appear. Change the 'Initial Password' with a new Password of your choice with minimum 8 digits/characters or combination thereof. Note the new Password. It is strongly recommended not to share your password with any other person and take utmost care to keep your password confidential.
• vii) Home page of remote e-voting will open. Click on remote e-voting: Active Voting Cycles.

viii) Select 'EVEN' of 'MOREPEN LABORATORIES LIMITED'.

• ix) Now you are ready for remote e-voting as 'Cast Vote' page opens.
• x) Cast your vote by selecting appropriate option and click on 'Submit'. Click on 'Confirm' when prompted.
• xi) Upon confirmation, the message 'Vote cast successfully' will be displayed.
• xii) Once you have confirmed your vote on the resolution, you cannot modify your vote.
• xiii) Institutional shareholders (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the relevant Board Resolution/Authority letter, etc. together with attested specimen signature of the duly authorized signatory(ies) who are authorized to vote, to the Scrutinizer through e-mail to investors@morepen.com with a copy marked to evoting@nsdl.co.in.

(b) In case of members receiving physical copy of the Notice of AGM and Attendance Slip:

i) Initial Password is provided as follows along with Attendance Slip:

EVEN (E-Voting Event Number)	USER ID	PASSWORD/PIN	NO. OF SHARES
-	-	-	-

ii) Please follow all steps from S. No. (ii) to S. No. (xiii) above, to cast your vote.

General Instructions:

• (a) During the remote e-voting period, members of the Company, holding shares either in physical or dematerialized form as on the th cut-off date i.e. Friday, 6 September, 2019 (end of day), may cast their vote electronically. The remote e-voting module shall be disabled by NSDL for voting thereafter.
• (b) In case of any queries, you may refer the Frequently Asked Questions (FAQs) for Members and remote e-voting user manual for Members available at the download section of www.evoting.nsdl.com or Contact on toll free no.: 1800-222-990.
• (c) You can also update your mobile number and e-mail id in the user profile details of the folio which may be used for sending future communication(s).
• (d) The voting rights of members shall be in proportion to their shares of the paid up equity share capital of the Company as on the th cut-off date i.e., Friday, 6 September, 2019 (end of day).
• (e) Any person, who acquires shares and becomes member of the Company after dispatch of the notice and holding shares as on the th cut-off date, i.e., Friday, 6 September, 2019 (end of day), may obtain the login ID and password by sending a request to NSDL at evoting@nsdl.co.in or to the Company's Registrar - Mas Services Limited at info@masserv.com.

However, if you are already registered with NSDL for remote e-voting, then you can use your existing user ID and password for casting your vote.

Note: If you forgot your password, you can reset your password by using "Forgot User Details/Password" or "Physical User Reset Password" option available on www.evoting.nsdl.com.

In case Shareholders are holding shares in demat mode, USER-ID is the combination of (DPID+ClientID).

In case Shareholders are holding shares in physical mode, USER-ID is the combination of (Even No+Folio No).

• (f) A member may participate in the AGM even after exercising his right to vote through remote e-voting but shall not be allowed to vote again at the AGM.
• (g) A person, whose name is recorded in the register of members or in the register of beneficial owners maintained by the depositories as on the cut-off date only shall be entitled to avail the facility of remote e-voting as well as voting at the AGM through ballot paper.
• (h) The Company has appointed Mr. Praveen Dua, Practicing Company Secretary (Membership No. FCS 3573 & C.P. No. 2139) as the Scrutinizer to scrutinize the voting and remote e-voting process in a fair and transparent manner.

• (i) The Chairman shall, at the AGM, at the end of discussion on the resolutions on which voting is to be held, allow voting with the assistance of Scrutinizer, by use of 'Ballot Paper' for all those members who are present at the AGM but have not casted their votes by availing the remote e-voting facility.
• (j) The Scrutinizer shall after the conclusion of voting at the AGM, will first count the votes cast at the meeting and thereafter unblock the votes cast through remote e-voting in the presence of at least two witnesses not in the employment of the Company and shall make, not later than three days of the conclusion of the AGM, a consolidated Scrutinizer's report of the total votes cast in favour or against, if any, to the Chairman or a person authorized by him in writing, who shall countersign the same and declare the result of the voting forthwith.
• (k) The results declared along with the report of the Scrutinizer shall be placed on the website of the Company www.morepen.com and on the website of NSDL immediately after the declaration of result by the Chairman or a person authorized by him in writing. The results shall, simultaneously, be forwarded to NSE & BSE which shall place the results on their website.

By order of the Board of Directors For Morepen Laboratories limited

Place: New Delhi th Date: 27 July, 2019

CIN: L24231HP1984PLC006028

Sushil Suri (Chairman & Managing Director) DIN: 00012028

Registered Office: Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, H.P. - 173205

STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013

As required under Section 102 of the Companies Act, 2013, the following statement sets out all material facts concerning each item of special business mentioned under Item Nos. 3 to 12 of the accompanying Notice:

Item No. 3:

Mr. Sushil Suri (DIN: 00012028), is a fellow member of the Institute of Chartered Accountants of India (ICAI) and possesses a vast experience of more than 28 years in the various fields including finance, operations, management and managerial entrepreneurship in the pharmaceutical and hospitality industry. He is serving on the Board of Morepen Laboratories Limited since February, 1992 while he is acting as Chairman & Managing Director of the Company since October, 2000.

Considering his valued contribution in the conduct and growth of business, the Nomination and Remuneration Committee of the Board recommended his appointment as Chairman & Managing Director of the Company, not liable to retire by rotation and to hold th th office for a term of 5 (five) consecutive years with effect from 20 October, 2018 up-to 19 October, 2023 duly approved by the rd st members of the Company at 33 Annual General Meeting held on 21 September, 2018 within remuneration ceiling i.e., 5% of the net profit of the Company, calculated as per Section 198 of the Companies Act, 2013.

Keeping in view, the vast experience of Mr. Sushil Suri, the Board with the recommendation of the Nomination and Remuneration th Committee at its meeting held on 27 July, 2019 has approved payment of remuneration up-to Rs. 5,00,00,000/- (Rupees Five Crore st st Only) per annum for the further period from 1 April, 2019 to 31 March, 2022 (i.e., for 3 years) to Mr. Sushil Suri, for which approval of the members is required. No sitting fees will be paid to Mr. Sushil Suri for attending meeting of the Board of Directors or any committee thereof. The details of remuneration are as under:

S. No.	Particulars	Amount (Rs.)
1.	Basic Pay	Upto ` 4,20,00,000 per annum
2.	Perquisites & Allowances	Upto ` 80,00,000 per annum

Pursuant to the Companies (Amendment) Act, 2017, first proviso of Section 197(1) of the Companies Act, 2013 amended with effect th from 12 September, 2018, the Company through Special Resolution may make payment of remuneration exceeding eleven percent of the net profits of the Company, subject to the provisions of Schedule V. The requirement of approval of the Central Government has been omitted.

Provided also that the Company has not defaulted in payment of dues to any bank or public financial institution or non-convertible debenture holders or any other secured creditor, therefore, requirements of prior approval of the bank or public financial institution concerned or the non-convertible debenture holders or other secured creditor, as the case may be, has not arisen before proposing this resolution for your approval.

Pursuant to Schedule V of the Companies Act, 2013, information related to appointee is given in Annexure 'A'.

Save and except Mr. Sushil Suri and Mrs. Anju Suri, none of Directors / Key Managerial Personnel of the Company / their relatives are in anyway, concerned or interested, financially or otherwise, in this resolution.

The Board commends the Special Resolution set out at Item No. 3 of the Notice for approval by the members.

Item No. 4:

st The tenure of Dr. Arun Kumar Sinha (DIN: 00450783) as Whole-Time Director of the Company is completed on 31 March, 2019. On the recommendation of the Nomination & Remuneration Committee, the Board of Directors of the Company ('the Board') at its th meeting held on 30 March, 2019, subject to approval of the shareholders, re-appointed Dr. Arun Kumar Sinha as the Whole-Time Director of the Company.

Dr. Arun Kumar Sinha is aged about 68 years, who will attain the age of 70 years during his term of 3 years. Dr. Arun Kumar Sinha has rich and varied experience in the industry and has been involved in the operations of the Company. It would be in the interest of the Company to continue to avail of his considerable expertise and to re-appoint Dr. Arun Kumar Sinha as a Whole Time Director. Accordingly, approval of the members is sought for passing a Special Resolution for re-appointment of Dr. Arun Kumar Sinha as a Whole Time Director pursuant to the provisions Section of 196, 197 and 203 and other applicable provisions, if any, of the Companies Act, 2013 ("Act") read with Schedule V and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s) or re-enactment thereof, for the time being in force.

The terms and conditions of re-appointment of Dr. Arun Kumar Sinha may be altered and varied from time to time by the Board/Nomination and Remuneration Committee in such manner as may be mutually agreed, subject to such approvals as may be required and within applicable limits of the Companies Act, 2013. No sitting fees will be paid to Dr. Arun Kumar Sinha for attending meeting of the Board of Directors or any committee thereof.

Save as provided in the foregoing paragraph, Dr. Arun Kumar Sinha satisfies all other conditions set out in Part-I of Schedule V to the Act as also conditions set out under sub-section (3) of Section 196 of the Companies Act, 2013, for being eligible for his reappointment.

Pursuant to provisions of Regulation 36 (3) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, and in compliance of the Secretarial Standard-2 of the ICSI, the Companies Act, 2013 and its rules made thereunder, the requisite disclosures are annexed with this notice as Annexure-I.

Pursuant to Schedule V of the Companies Act, 2013, information related to appointee is given in Annexure 'A'.

Except Dr. Arun Kumar Sinha, none of the Directors or Key Managerial Personnel of the Company and their relatives, are in any way, concerned or interested, financially or otherwise, in this resolutions.

Board recommends the passing of the resolution set out at item no. 4 of the notice as Special Resolution.

Item No. 5 to 7:

The term of Mr. Sukhcharan Singh, Mr. Manoj Joshi, Mr. Bhupender Raj Wadhwa, as Non-Executive Independent Directors of the th Company (hereinafter collectively referred as 'Independent Directors'), is going to be completed on 18 September, 2019. These th th Independent Directors have been appointed at the 29 Annual General Meeting held on 19 September, 2014.

On the recommendation of the Nomination & Remuneration Committee, the Board of Directors of the Company ('the Board') at its th meeting held on 27 July, 2019, subject to the approval of the members, re-appointed Mr. Sukhcharan Singh, Mr. Manoj Joshi and th Mr. Bhupender Raj Wadhwa as an Independent Directors of the Company for a second term of 5 consecutive years i.e., from 19 th September, 2019 to 18 September , 2024, in terms of Section 149 read with Schedule IV of the Companies Act, 2013 ('the Act'), and Regulation 17 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ('SEBI (LODR) Regulations 2015'), or any amendment thereto or modification thereof. The brief profile of Independent Directors are as follows;

Mr. Sukhcharan Singh (DIN: 00041987), is a Bachelor in Arts and a Retired Inspector General of Police. He joined the Board of the Company in June, 2005 and has continued on the Board ever since as a Non-Executive Independent Director. He is the member of Audit Committee, Nomination and Remuneration Committee and the Stakeholders Relationship Committee of the Board.

Mr. Manoj Joshi (DIN: 00036546), is a Post Graduate in Commerce - Business Administration. He has got a rich experience of more than 36 years in the area of Board Management, Policy Management, Public Advocacy and Management Consultancy. He joined the Board of the Company in June, 1992 and has continued on the Board ever since as a Non-Executive Independent Director. He is the Chairman of Audit Committee, Nomination and Remuneration Committee and the Stakeholders Relationship Committee of the Board.

Mr. Bhupender Raj Wadhwa (DIN: 00012096), is a Graduate in Commerce and a Fellow Member of the Institute of Chartered Accountants of India. He is a Chartered Accountant in practice by profession having more than 31 years' experience in the area of accountancy and taxation. He joined the Board of the Company in June, 2005 and has continued on the Board ever since as a Non-Executive Independent Director. He is the member of Audit Committee and Nomination and Remuneration Committee of the Board.

The Board is of the view that the continued association of Mr. Sukhcharan Singh, Mr. Manoj Joshi and Mr. Bhupender Raj Wadhwa would benefit the Company, given the knowledge, experience and performance and contribution to Board processes by them. Declaration has been received from them that they meet the criteria of Independence prescribed under Section 149 of the Act read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and Regulation 16 of the Listing Regulations 2015.

The Nomination & Remuneration Committee and the Board evaluated the performance of Mr. Sukhcharan Singh, Mr. Manoj Joshi, Mr. Bhupender Raj Wadhwa, rated them satisfactory on all parameters and recommended their re-appointment. All these independent directors fulfil the conditions specified in the Act and the Rules framed thereunder for appointment as Independent Director and they are independent of the management. A copy of draft letter of appointment of the above Independent Directors, setting out the terms and conditions of appointment, is available for inspection by the Members at the Registered Office of the Company during normal business hours on any working day, excluding Saturday and also available on the website of the Company www.morepen.com.

st Regulation 17(1A) of SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018 effective from 1 April, 2019, requires that any Non-Executive Director who has attained the age of 75 years or more cannot be appointed or continued as a Non-Executive Director in any listed company until and unless approval of Members has been obtained for the same by way of special resolution. Since Mr. Sukhcharan Singh, Non-Executive Independent Director of the Company is covered under the aforesaid provision being aged more than 75 years, the Company is required to obtain approval of Members by way of special resolution for continuing his Directorship in the Company. The justification of appointment of Mr. Sukhcharan Singh is already discussed in aforesaid paras.

Pursuant to provisions of Regulation 36 (3) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015, as amended, and in compliance of the Secretarial Standard - 2 of the ICSI, the Companies Act, 2013 and its rules made thereunder, the requisite disclosures are annexed with this notice as Annexure - I.

Pursuant to the provisions of Sections 149, 152 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules framed thereunder, read with Schedule IV to the Act (including any statutory modification(s) or re-enactment thereof, for the time being in force), the Board of Directors of the Company recommend the passing of the resolutions set out under item nos. 5 to 7 as Special Resolution.

None of the Directors or Key Managerial Personnel of the Company and their relatives, other than the Independent Directors and their relatives for their respective appointment, are in any way, concerned or interested, financially or otherwise, in these resolutions.

Item No: 8

Under the provisions of the Section 94 of the Companies Act, 2013, (the "Act") and other applicable provisions, if any, of the Companies Act, 2013 and the Rules framed thereunder, certain documents such as the register of members and index of members, preference shareholder's register, register and index of debenture holders, register and index of any other security holders, register of renewed and duplicate shares / debentures / securities certificates, other statutory registers as required to be maintained under the Companies Act, 2013 and its rules made thereunder and copies of all annual returns prepared, together with the copies of certificates and documents required to be annexed thereto under Sections 92 of the Act, and other related books, are required to be maintained at the registered office of the Company.

Whereas, more than one-tenth of the total members of the Company are residing in the Delhi & National Capital Region and in the interest of operational and administrative convenience, it is proposed to maintain the register of members/ debenture holders, index of members/ debenture holders and copies of annual returns and other statutory registers at the Company's office situated at 4th Floor, Antriksh Bhawan, 22 Kasturba Gandhi Marg, New Delhi-110001, a place other than its registered office.

Pursuant to provision of first proviso of the Section 94 (1) of the Companies Act, 2013 and its rules made thereunder, the Board of Directors of the Company recommend the passing of the resolution set out under item no. 8 of the Notice as a Special Resolution.

None of the Directors or Key Managerial Personnel of the Company and their relatives, are in any way, concerned or interested, financially or otherwise, in this resolution.

Item No. 9

In order to optimise the use of funds and also to achieve long term strategic and business objectives, the Board of Directors of the Company intends to make investment in other bodies corporate or granting loans, giving guarantee or providing security to other persons or other body corporate or as and when required.

The Company had obtained requisite approval of the members under erstwhile the Companies Act 1956, within the limit provided under the said Act. Whereas, pursuant to the provisions of section 186(3) of the Companies Act, 2013 and rules made there under, the Company needs to obtain prior approval of shareholders/ members by way of special resolution passed at the General Meeting in case the amount of investment, loan, guarantee or security proposed to be made is more than the higher of sixty percent of the paid up share capital, free reserves and securities premium account or one hundred percent of free reserves and securities premium account.

Accordingly, the Board of Directors of the Company proposes to obtain approval of members as contained in this notice for an amount not exceeding INR 5,00,00,00,000 (Rupees Five Hundred Crore Only) outstanding at any time notwithstanding that such investments, outstanding loans given or to be given and guarantees and security provided are in excess of the limits prescribed as per Section 186 of the Companies Act, 2013.

The Board of Directors of the Company recommends the passing of the resolution set out under item no. 9 of the Notice as a Special Resolution.

None of the Directors or Key Managerial Personnel of the Company and their relatives, are in any way, concerned or interested, financially or otherwise, in this resolution.

Item Nos. 10 & 11

The members of the Company in its meeting had empowered the Board of Directors of the Company to borrow up to an amount of ` 12,00,00,00,000/- (Rupees One Thousand Two Hundred Crores Only) as per section 293(1)(d) the Companies Act, 1956, the borrowing powers was required to be approved by members through 'Ordinary Resolution'. However, pursuant to Section 180(1)(c) of the Companies Act, 2013, the Board of Directors of the Company should have approval of the members in form of 'Special Resolution' to borrow moneys, apart from temporary loans obtained from the Company's Bankers in the ordinary course of business, in excess of the aggregate of paid-up share capital, free reserves and Securities Premium of the Company.

There is no change in amount of borrowing powers for which approval was taken from members of the Company. Further, the borrowed money is less than the aggregate of Paid Up Capital, Free Reserves and Securities Premium of the Company in terms of Section 180(1) (c) of the Companies Act, 2013.

Further, to secure the said borrowings, which the Company may borrow from time to time, the Company may be required to create mortgages / charges / hypothecation in favour of the Lenders/Financial Institutions/Bodies Corporate/others, on all or any of its movable and immovable properties. In order to create aforesaid mortgages / charges / hypothecation, the Company had obtained the approval of members in form of 'Ordinary Resolution' in compliance of erstwhile the Companies Act, 1956. Presently, the consent of the members is require in the form of 'Special Resolution' under section 180(1)(a) of Companies Act, 2013.

There is no in change quantum up-to which the power was delegated to the Board of Directors for to create mortgages / charges / hypothecation in favour of the Lenders/Financial Institutions/Bodies Corporate/others, on all or any of its movable and immovable properties.

Accordingly, the resolutions as given in notice at item no. 11 & 12 are proposed to obtain approval of the members in term of the provision of Sections 180(1)(c) and 180(1)(a) of the Companies Act, 2013. The Board of Directors recommends passing of resolutions under item nos. 10 and 11, as Special Resolutions.

None of the Directors or Key Managerial Personnel of the Company and their relatives, are in any way, concerned or interested, financially or otherwise, in this resolution.

Item No. 12:

As per the recommendations of the Audit Committee, the Board of Directors of the Company have appointed M/s. Vijender Sharma & Co., Cost Accountants, as Cost Auditors of the Company, to conduct the audit of the cost records of the Company for the financial st year ending 31 March, 2020 (FY 2019-20) pursuant to the provisions of Section 148 and other applicable provisions, if any, of the Companies Act, 2013 ('Act') read with the Companies (Audit and Auditors) Rules, 2014 (including any statutory modification(s) or re-enactment thereof, for the time being in force).

In accordance with the provisions of Section 148(3) of the Act read with Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration payable to the Cost Auditors, as recommended by the Audit Committee and approved by the Board of Directors of the Company, has to be ratified by the members of the Company.

The Board of Directors of the Company recommends the passing of the resolution set out under item no. 12 of the Notice as an Ordinary Resolution.

None of the Directors or Key Managerial Personnel of the Company and their relatives, are in any way, concerned or interested, financially or otherwise, in this resolution.

ANNEXURE 'A'

Disclosure Pursuant to Schedule-V of the Companies Act, 2013

I. GENERAL INFORMATION

(1) Nature of the Industry

The pharmaceutical industry discovers, develops, produces, and markets drugs or pharmaceutical drugs for use as medications to be administered (or self-administered) to patients, with the aim to cure them, vaccinate them, or alleviate the symptoms. Morepen Laboratories Limited ('Morepen'/ 'the Company'), being a Pharmaceutical Company is dealing in generic or brand medications and medical devices. The Company is subject to a variety of laws and regulations that govern the patenting, testing, safety, efficacy and marketing of drugs.

(2) Date or expected commencement of commercial production

st The Company commenced its operations since 1 December, 1984.

(3) In case of new companies, expected date of commencement of activities as per project approved by financial institution appearing in the prospectus.

Not Applicable

(4) Financial Performance based on given indicators:

			(` in lakh)
Particular	2018-19	2017-18	2016-17
Sales & other Income	72,091.47	56,437.05	55,122.53
Profit before depreciation, Interest and Tax but after Prior Period Items	6,697.40	6,391.88	6,358.59
Depreciation/ Amortization	3,800.78	3,339.95	3,356.17
Interest and Finance Charges	207.08	429.46	747.35
Profit/Loss before Exceptional Item and Tax	2,689.54	2,622.47	2,255.07
Exceptional Gain/ (Loss)	-	-	-
Profit/ (Loss) before Tax	2,689.54	2,622.47	2,255.07

(5) Foreign Investments or Collaborations, if any

Except investment in Morepen Inc., Subsidiary Company, the company is not having any foreign investment/ foreign collaboration.

II. INFORMATION ABOUT THE APPOINTEE

S.no.	Particulars	Mr. Sushil Suri	Dr. Arun Kumar Sinha
(1)	Back ground details including qualification, experience etc.	Mr. Sushil Suri has more than 2 decades of experience in pharmaceuticals industry and has played an active role in the evolution of the pharma sector since 1992. His experience and expertise span all segments of the pharma industry including the fields of strategic & financial planning, manufacturing, capital structuring, collaborations and joint ventures etc. He is a qualified Chartered Accountant & a Fellow member of the Institute of Chartered Accountants of India.	Dr. Arun Kumar Sinha, has a professional having experience of more than 47 years in pharmaceutical companies in different lines. Dr. Arun Kumar Sinha joined the Board of the Company in June, 2005 as the Whole Time Director of the Company. Mr. Sinha is a M.Sc. & P.hd. in Chemistry, holding P.G. Diploma in personnel management and industrial relations.

(2)	Past Remuneration	Upto Rs. 3,00,00,000/-, subject to maximum of 5% of the net profit calculated as per Section 198 of the Companies Act, 2013.	Upto Rs. 45,00,000/-.
(3)	Recognition or awards	Mr. Sushil Suri is associated with the pharmaceutical industry from more than 2 decades. He has diversified experience of finance, operations, management and managerial entrepreneurship in the pharmaceutical industry.	Dr. Arun Kumar Sinha is associated with the pharmaceutical industry from more than 4 decades. He has vast experience in the pharmaceutical sector specially in formulations.
(4)	Job Profile and suitability	As Chairman and Managing Director of the Company, Mr. Sushil Suri is responsible for all matters pertaining to finance, raising of funds, investor relations and business development. Mr. Suri has vast experience and expertise span in all segments of the pharma industry including the fields of strategic & financial planning, capital structuring, collaborations & joint ventures, manufacturing and sales/ marketing. He is highly suitable for the job.	Dr. Arun Kumar Sinha is heading the formulations facility of the Company. Since June, 2005, he is acting as Whole Time Director of the Company and serving the Company by providing his stewardship at the plant level.
(5)	Remuneration Proposed/ remuneration sought to be paid	The remuneration is proposed to pay him is st upto Rs. 5,00,00,000/- per annum from 1 st April, 2019 to 31 March, 2022.	The remuneration is proposed to pay him is st upto Rs. 42,00,000/- per annum from 1 st April, 2019 to 31 March, 2022.
(6)	Comparative remuneration profile with respect to industry, size of the company, profile of the position and person	The remuneration of Mr. Sushil Suri is fully justifiable and comparable to that prevailing in the industry, keeping in view the profile and the position of Chairman and Managing Director respectively and enriched knowledge & vast experience. He shall be looking after and responsible for the whole affairs of the management of the Company and shall be accountable to the Board of Directors of the Company.	The remuneration of Dr. Arun Kumar Sinha is fully justifiable and comparable to that prevailing in the industry. He is holding a key position and profile in the Company since long time. He is designated as a Whole Time Director - Technical.
(7)	Pecuniary relationship directly or indirectly with the Company, or relationship with the Managerial Personnel, if any	Mr. Sushil Suri is a Promoter Director of the Company. He is spouse of Mrs. Anju Suri, Director of the Company. Except and otherwise, Mr. Suri does not have any pecuniary relationship with the Company and is not related with any other director or any other managerial personnel(s) of the Company.	Dr. Arun Kumar Sinha does not have any pecuniary relationship with the Company and is not related with any other director or any other managerial personnel(s) of the Company.

III. OTHER INFORMATION

(1) Reasons for loss/inadequacy of profits

The Company is engaged in the manufacturing of bulk drugs and its intermediates. In the early years of its incorporation, the Company's financial position went on well. However, during the years 2000-02, due to a sharp fall in Company's prime product 'Loratadine' in the international markets, the Company faced huge financial loss which adversely affected the sustainability of its operations as well as its ability to meet its debt servicing obligations.

Presently, the pharmaceutical industry continues to thrive, yet there are several challenges that may affect the industry's future growth in 2019 and beyond. The drug prices are at an all-time high, R&D productivity has only just begun to climb again following a limitation faced in previous few years. The Indian Pharmaceutical Sectors is recovering from regulatory turbulence in the most profitable global market, top Indian pharma companies have zeroed in on cost rationalization, better compliance standards and more nimble response to competition while hoping the Chinese market could provide some respite ahead. The Company is incurring significant expenses in technology, infrastructure and skilled professionals for successfully running its business. The company faces several competitive pressures from within the pharmaceutical industry and from other international challenges. The company has been making significant investments in various areas to maintain its leadership position within the industry and further grow of its business.

(2) Steps taken or proposed to be taken for improvement

The Company is currently focusing on a new therapeutic category i.e., Anti-Coagulant in which few drugslike Apixaban & Rivaroxaban are among the top 10 selling drugs in 2017 & 2018. The Company is also focusing on another anti-coagulant drug Edoxaban Tosylate for its development in the R&D. Another molecule Dabigatran Etexilate Mesylate of same category used for Thromboembolic disorders is in advanced stages of R&D development. The Company anticipate to make its hold further strong in anti-histaminic category by developing Rupatadine Fumarate in the coming year.

The Company has filed five new patent applications for Crystalline Empagliflozin, Novel purification process of UDCA, Novel purification and preparation process of Rivaroxaban, Rupatadine Fumarate Polymorphic Form A & for Pharmaceutical Composition in Form of Aqueous Syrup Comprising Desloratadine and Montelukast Sodium.

The formulation and home diagnostics business has significantly improved during the year and efforts are on to make significant growth in the coming years. The customers having reposed confidence in our branded product portfolio will be offered new products during the coming years and market penetration shall also be improved.

The tie-up with Vésale Pharma International of Belgium will be offering the entire product folio in immediate future and company expects to have some footprint in Probiotics market in India.

The company is reaching more markets and servicing large spectrum of people to deliver its wide range of products.

(3) Expected increase in productivity and profits in measurable terms

The Company expects improvement in its profitability as a result of aforesaid efforts.

IV. DISCLOSURES

The details of proposed remuneration are set out in the accompanying notice. The Company shall make appropriate disclosures as required under Schedule V of the Companies Act, 2013 in the Corporate Governance Report forming part of the Directors' Report of the Company.

Annexure - I

Details of Directors Seeking Appointment/Re-appointment at the Annual General Meeting

(Pursuant to Secretarial Standards - 2, Regulation 36 (3) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 & Companies Act, 2013)

ROUTE MAP TO THE AGM VENUE

(Map not to scale)

		E-mail Id : investors@morepen.com; Tel No.: +91-01795-276201-03; Fax No.: +91-01795-276204
	Form No. MGT – 11 PROXY FORM
	[Pursuant to Section 105 (6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration) Rules, 2014]
	Name of the Member(s):
	Registered address:
	E-mail Id: Folio No. /DP ID & Client ID:
	I/We, being the member(s) of the above named Company holding shares of ` each, hereby appoint
1)	Name: E-mail Id:
	Address:
	Signature:
2)	Name: E-mail Id:
	Address: Signature:
	as my/our Proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 34 Annual General Meeting of the th
	Company, to be held on Friday, the 13 day of September, 2019 at 10.00 a.m. at the Registered Office of the Company at Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, H. P. – 173205 and at any adjournment thereof in respect of such resolutions as are indicated below:
Res.	Description	For
No. 1.	Adoption of Audited Financial Statement, including Consolidated Financial Statements, of the st Company for the financial year ended 31 March, 2019 together with the reports of the Directors'
	and Auditors' thereon Appointment of a Director in place of Mrs. Anju Suri (DIN: 00042033), who retires by rotation
	at this Annual General Meeting and being eligible, offers herself for re-appointment.
	Increase in remuneration of Mr. Sushil Suri (DIN: 00012028), Chairman & Managing Director
	of the Company Re-appointment of Dr. Arun Kumar Sinha (DIN: 00450783) as a Whole-Time Director
	of the Company Re-appointment of Mr. Sukhcharan Singh (DIN: 00041987) as an Independent Director
	of the Company Re-appointment of Mr. Manoj Joshi (DIN: 00036546) as an Independent Director of the Company
	Re-appointment of Mr. Bhupender Raj Wadhwa (DIN: 00012096) as an Independent Director of the Company
	Maintenance of Register of Members and other Statutory Registers at a place other than
2. 3. 4. 5. 6. 7. 8.	Registered Office of the Company		Against
	Increase in the limits of Loan and Investment under section 186(3) of the Companies act, 2013
	Authorization for borrowings under Section 180 (1) (c) of the Companies Act, 2013
9. 10. 11. 12.	Creation of charge on assets under Section 180 (1) (a) of the Companies Act, 2013 Ratification of remuneration of M/s. Vijender Sharma & Co., Cost Accountants, as Cost

NOTES:

• 1) Please put a 'X' in the appropriate column against the respective resolutions. If you leave the 'For' or 'Against' column blank against any or all the resolutions, your proxy will be entitled to vote in the manner as he/she thinks appropriate.
• 2) Pursuant to the provisions of Section 105 of the Companies Act, 2013, a person can act as a proxy on behalf of not more than fifty (50) members and holding in the aggregate not more than ten percent (10%) of the total Share Capital of the Company carrying voting rights. A member holding more than ten percent (10%), of the total Share Capital of the Company carrying voting rights may appoint a single person as proxy and such person shall not act as proxy for any other member.
• 1. This form of Proxy in order to be effective should be duly completed, stamped, signed and deposited at the Registered Office of the Company, not less than 48 hours before the commencement of the meeting.

MOREPEN LABORATORIES LIMITED

Regd. Off : Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, H. P.– 173205 CIN: L24231HP1984PLC006028; Website : www.morepen.com; E-mail Id : investors@morepen.com; Tel No.: +91-01795-276201-03; Fax No.: +91-01795-276204

E-COMMUNICATION REGISTRATION FORM

Dear Shareholders,

st You are aware that the provisions of Companies Act, 2013 have been made effective from 1 April, 2014. Pursuant to Section 101 and Section 136 of the Companies Act, 2013 read with relevant Rules issued thereunder, Companies can serve Annual Reports, Notices and other communications through electronic mode to those shareholders who have registered their email address either with the Company/ RTA or with the Depository.

It is a welcome move that would be benefit the society at large, as this will reduce paper consumption to a great extent and allow shareholders to contribute towards a greener environment. This provides a golden opportunity to every shareholder of Morepen Laboratories Limited to contribute to the cause of 'Green Initiative' by giving their consent to receive various communications from the Company through electronic mode.

We therefore invite all our shareholders to contribute to the cause by filling up the form given below to receive communication from the Company in electronic mode. You can also download the appended registration form from the website of the Company www.morepen.com.

[Please note that as a Member of the Company, you will be entitled to receive all such communication in physical form, upon request.]

Best Regards,

Sd/-

Sushil Suri (Chairman & Managing Director)

E-COMMUNICATION REGISTRATION FORM

Folio No. /DP ID & Client ID:
st Name of the 1 Registered Holder:
Name of the Joint Holder[s]: (1) (2)
Registered Address:
E-mail ID (to be registered): Mob./Tel. No.:
I/We shareholder(s) of Morepen Laboratories Limited hereby agree to receive communications from the Company in
electronic mode. Please register my above E-mail ID in your records for sending communications in electronic form.
Date: Signature:
Note: Shareholder(s) are requested to keep the Company informed as and when there is any change in the e-mail address.

Morepen Laboratories Limited

(CIN: L24231 HP1984PLC006028) Corp. Off. : 4th floor, Antriksh Bhawan, 22 K.G. Marg, New Delhi - 110 001, INDIA Tel.: 91-11-23324443, 23712025, Fax: 91-11-23722422 E-mail : investors@morepen.com Website : www.morepen.com

MOREPEN LABORATORIES LIMITED

Regd. Off: Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh – 173 205 CIN: L24231HP1984PLC006028; Website: www.morepen.com; E-mail id: investors@morepen.com; Tel No.: +91-01795-276201-03; Fax No.: +91-01795-276204

th Addendum to the Notice of the 34 Annual General Meeting (AGM) of Morepen Laboratories Limited to be held on Friday, th 13 September, 2019 at 10.00 a.m. at Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh – 173 205.

Your Directors recommend the following resolutions conditions as specified in the explanatory statement i.e., appointment of Mr. Sanjay Suri (DIN: 00041590) as pursuant to Section 102 of the Act annexed to this a Whole-Time Director and Mr. Praveen Kumar Dutt Notice and on the remuneration as follows: (DIN: 06712574) as an Independent Director of the S. Particulars Amount (Rs.) th Company for your approval at the 34 AGM. No.

13. Appointment of Mr. Sanjay Suri (DIN: 00041590) per annum

To consider and, if thought fit, to pass the following and/or Incentives per annum Resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of of the Company be and is hereby authorized to do Sections 196, 197 and 203 of the Companies Act, all acts and take all such steps as may be necessary, 2013 (the 'Act') read with Schedule V of the said act proper or expedient to give effect to this resolution." and the Companies (Appointment and 14. Appointment of Mr. Praveen Kumar Dutt (DIN: Remuneration of Managerial Personnel) Rules, 06712574) as an Independent Director 2014 (including any statutory modification(s) or re-To consider and, if thought fit, to pass the following enactment thereof, for the time being in force) or any amendment thereto or modification thereof, Mr. Sanjay Suri (DIN: 00041590), who was appointed as "RESOLVED THAT pursuant to the provisions of an Additional Director designated as Whole Time Sections 149, 152 read with Schedule IV and all Director of the Company pursuant to provisions of other applicable provisions of the Companies Act, Section 161 of the Act and the Articles of 2013 (the 'Act') read with the Companies Association of the Company and who holds office (Appointment and Qualifications of Directors) upto the date of this Annual General Meeting, be Rules, 2014 (including any statutory modification(s) and is hereby appointed as a Whole Time Director or re-enactment thereof for the time being in force) of the Company, liable to retire by rotation, for a and pursuant to the Regulation 17 of the SEBI th period of three years with effect from 13 August, (Listing Obligations and Disclosure Requirements) th 2019 to 12 August, 2022 on such terms and Regulations, 2015 (hereinafter referred to as "Listing

(DIN: 06712574) as an Independent Director of the th Company for your approval at the 34 AGM.	S. No.	Particulars	Amount (Rs.)
Notice is hereby given that the following items of	1.	Basic Pay and	Upto Rs. 1.26 Crore
business are added in the aforesaid Notice as Item No. 13		Allowances	per annum
and Item no. 14 as Special Business: Appointment of Mr. Sanjay Suri (DIN: 00041590)	2	Other Perquisites	Upto Rs. 0.24 Crore per annum
as a Whole-Time Director	3	Commission(s)	Upto Rs. 2.00 Crore
To consider and, if thought fit, to pass the following		and/or Incentives	per annum

RESOLVED FURTHER THAT the Board of Directors

Resolution as an Ordinary Resolution:

Regulations"), Mr. Praveen Kumar Dutt (DIN: RESOLVED FURTHER THAT the Board of Directors 06712574), who was appointed as an Additional of the Company be and is hereby authorized to do Director, designated as Independent Director, all acts and take all such steps as may be necessary, pursuant to provisions of Section 161 of the Act and proper or expedient to give effect to this resolution." the Articles of Association of the Company and who By order of the Board of Directors holds office upto the date of this Annual General For Morepen Laboratories Limited Meeting, be and is hereby appointed as an Independent Director of the Company for a term of Sushil Suri th five (5) consecutive years w.e.f., 13 August, 2019, Place: New Delhi Chairman & Managing Director th to 12 August, 2024 and not liable to retire by Date: 13.08.2019 DIN:00012028 rotation.

• 1. Statement giving details of the Director seeking Company. This revised Proxy Form will supersede Regulation 36(3) of the SEBI (Listing Obligations and AGM. Disclosure Requirements) Regulations, 2015 and

• AGM. Notice.

• th NOTES: 4. This Addendum to the Notice of 34 AGM is th available along with the Notice of 34 AGM and 1. An Explanatory Statement pursuant to Section Annual Report on the website of the Company 102(1) of the Companies Act, 2013 relating to the www.morepen.com. The revised Proxy Form Special Business as proposed above to be transacted including the resolution proposed hereinabove is at the AGM is annexed hereto. enclosed and also available on the website of the appointment pursuant to the requirement of the earlier Proxy Form annexed with the Notice of

• 1. All the processes, notes and instructions relating to Secretarial Standard on General Meeting ("SS-2") is th e-voting set out for and applicable to the ensuing 34 given below. AGM shall mutatis-mutandis apply to the e-voting 3. Relevant documents referred to in this Addendum to for the Resolution proposed in this Addendum to the th Notice of 34 AGM are open for inspection purpose Notice. Furthermore, Scrutinizer appointed for the at the Registered Office of the Company during its th ensuing 34 AGM will act as a Scrutinizer for the business hours on all working days up to the date of Resolutions proposed in this Addendum to the

EXPLANATORY STATEMENT PURSUANT TO SECTION 102(1) OF THE COMPANIES ACT, 2013

Director (Additional) on the Board of the Company, on Item No. 14

Morepen Limited (A wholly Owned subsidiary of of the Company. Morepen Laboratories Limited) and the affairs of the Mr. Praveen Kumar Dutt is a fellow member of the Institute of Company are managed under his active involvement, Chartered Accountants of India with post qualification guidance and supervision. He has around 26 years of experience of around 25 years in the field of Direct Taxation, business experience and has good knowledge in the field FEMA, International Taxation. of accounts, finance, banking and operations of He is also involved in formulating policies, managing Requirements) Regulations, 2015.

Pursuant to Schedule V of the Companies Act, 2013, The Board of Directors of the Company recommend the information related to appointee is given in passing of this resolution as an Ordinary Resolution. 'Annexure B'.

Item No. 13 Except Mr. Sushil Suri and Mrs. Anju Suri, none of the Directors or Key Managerial Personnel of the Company and The Board of Directors, on the recommendation of the their relatives, are in any way, concerned or interested, Nomination & Remuneration Committee, was appointed financially or otherwise, in these resolutions. Mr. Sanjay Suri (DIN: 00041590) as a Whole-Time

th 13 August, 2019 to hold office upto the date of ensuing The Board of Directors, on the recommendation of the th 34 Annual General Meeting of the Company and with Nomination & Remuneration Committee, was appointed the approval of members for a period of three (3) years Mr. Praveen Kumar Dutt (DIN: 06712574) as an Additional th th commencing from 13 August, 2019 to 12 August, Director (Independent Category) on the Board of the 2022. Company, not liable to retire by rotation, pursuant to Section th Mr. Sanjay Suri is a science graduate from Punjab 161 of the Companies Act, 2013 on 13 August, 2019 to hold th University India. He is also the Managing Director of Dr. office upto the date of ensuing 34 Annual General Meeting

pharmaceutical business. His key role is planning, The Company has received a declaration from him to the directing, coordinating the affairs of the API Business of effect that he meets the criteria of independence as provided the Company. He is currently heading the API Business, in Section 149(6) of the Companies Act, 2013 and which is the largest business segment of the Company. Regulation 16 of the SEBI (Listing Obligations and Disclosure

daily operations, planning strategies, initiating efficient In the opinion of the Board, he fulfills the criteria of systems and procedures for effective functioning of the Independence and possesses appropriate skills, experience Company. Mr. Suri is responsible for: and knowledge for being appointed as an Independent 1. An overall administration of the API business, Director. Considering his vast experience and knowledge and strategic guidance his appointment would be in the 2. Implementation of pharmaceutical quality systems interest of the Company. from time to time to comply with USFDA (United

States Food & Drug Administration). The Board of Directors recommends the appointment of Mr. Praveen Kumar Dutt as an Independent Director of the 3. Business development, management reviews etc. Company for a term of five (5) consecutive years from time to time. th commencing from 13 August, 2019, not liable to retire by th Pursuant to provisions of Regulation 36 (3) of the SEBI rotation, as set in this Addendum to the Notice of 34 AGM.

(Listing Obligations & Disclosure Requirements) Pursuant to provisions of Regulation 36 (3) of the SEBI Regulations, 2015, as amended, and in compliance of (Listing Obligations & Disclosure Requirements) the Secretarial Standard – 2 of the ICSI, the Companies Regulations, 2015, as amended, and in compliance of the Act, 2013 and its rules made thereunder, the requisite Secretarial Standard – 2 of the ICSI, the Companies Act, 2013 disclosures are annexed with this notice as and its rules made thereunder, the requisite disclosures are 'Annexure A-1'. annexed with this notice as 'Annexure A-1'.

None of the Directors or Key Managerial Personnel of the The Board of Directors of the Company recommend the Company and their relatives, are in any way, concerned or passing of this resolution as a Special Resolution. interested, financially or otherwise, in these resolutions.

Annexure – A-1

BRIEF RESUME OF DIRECTOR SEEKING APPOINTMENT AT THE ANNUAL GENERAL MEETING IN ACCORDANCE WITH THE SECRETARIAL STANDARDS ("SS-2") AND REGULATION 36(3) OF THE SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015:

Particulars	Mr. Sanjay Suri	Mr. Praveen Kumar Dutt
Date of Birth	04.08.1968	01.08.1968
Date of first Appointment	13.08.2019*	13.08.2019
Qualifications	Bachelor of Science (B.Sc.)	Chartered Accountant
Expertise in specific functional areas	He has around 26 years of experience in the field of accounts, finance, banking and operations of pharmaceutical business.	A fellow member of the Institute of Chartered Accountant of India (ICAI) with the post qualification experience of around 25 years in the field of direct Tax Matters, FEMA, and International Taxation.
Directorships in other Companies (excluding foreign companies)	• Shivalik Pesticides and Chemicals Private Limited • Blueheaven Marketing Private Limited • Joy Hotel and Resorts Private Limited • Mid-Med Financial Services and Investments Private Limited • Solitary Investments and Financial Services Private Limited • Solace Investments and Financial Services Private Limited • Total Care Limited • Dr. Morepen Limited • Silver Resort Hotel India Private Limited	• Blue Coast Hotels Limited • SI Infratel Limited

Memberships/Chairmanships of Board Committees in other Companies (includes only Audit Committee and Stakeholder Relationship Committee)	Nil	Chairman of Audit Committee: Blue Coast Hotels Limited Member of Stakeholder Relationship Committee: Blue Coast Hotels Limited
Details of remuneration sought to be paid and last drawn (approved) remuneration	Proposed- upto 3.5 Crore (including commission and/or incentive per annum incentive) per annum incentitive) per annum ve) per annum Last drawn - Not applicable	N.A
Relationship with other Directors, Manager and Key Managerial Personnel of the Company	Brother of Mr. Sushil Suri, Chairman and Managing Director	N.A
No. of meetings of Board attended during the year (2018-19)	NIL	NIL
Number of shares held in the Company	34,17,240	--
DIN	00041590	06712574
Terms and Conditions of appointment/ Reappointment	As set out in item no. 13 of the Explanatory Statement	As set out in item no. 14 of the Explanatory Statement

* Mr. Sanjay Suri, has been associated as Director of the Company from 14.10.2002 to 08.03.2003.

Annexure B

Disclosure pursuant to Schedule V of the Companies Act, 2013

I. GENERAL INFORMATION: Please refer to the notice of 34th Annual General Meeting dated 27th July 2019. For the sake of brevity is not repeated here.

II. INFORMATION ABOUT APPOINTEE:

S. No.	Particulars	Remarks
(1)	Back ground details including qualification, experience etc.	Mr. Sanjay Suri is a Bachelor of Science (B.Sc.), having more than 26 years of experience in pharmaceuticals industry. He has varied experience in the field of accounts, finance, banking and international sales and marketing, exports, joint ventures, statutory and regulatory approvals related to USFDA, strategic planning and manufacturing etc.
(2)	Past Remuneration as Director of the Company	Not applicable
(3)	Recognition or awards	Mr. Sanjay Suri heading API Business of the Company and instrumental in attainment of USFDA approvals of manufacturing plants of the Company.
(4)	Job Profile and suitability	He is playing key role in planning, directing, coordinating the affairs of the API Business of the Company. He is also involved in formulating policies, managing daily operations, planning strategies, initiating efficient systems and procedures for effective functioning of the Company. Mr. Suri is highly suitable for the job.
(5)	Remuneration Proposed/ remuneration sought to be paid	The remuneration proposed to pay him is up-to Rs. 3,50,00,000/- (including commission and/or incentitive) per annum from August 13. ive) per annum incentive) per annum 2019 to August 12, 2022.
(6)	Comparative remuneration profile with respect to industry, size of the company, profile of the position and person	The remuneration of Mr. Sanjay Suri is fully justifiable and comparable to that prevailing in the industry, keeping in view the profile handled by him, having enriched knowledge and vast experience. He shall be looking after manufacturing facilities of all plants of the Company in Himachal Pradesh.
(7)	Pecuniary relationship directly or indirectly with the Company, or relationship with the Managerial Personnel, if any	Mr. Sanjay Suri is a promoter of the Company. He is brother of Mr. Sushil Suri and Brother in law of Mrs. Anju Suri, Directors of the Company. Except and otherwise, Mr. Sanjay Suri does not have any pecuniary relationship with the Company and is not related with any other director or any other managerial personnel(s) of the Company.

• th th III.OTHER INFORMATION: Please refer to the notice of 34 Annual General Meeting dated 27 July 2019. For the sake of brevity is not repeated here.
• IV.DISCLOSURES: This item to the notice has been added after approval of Directors Report and Corporate Governance th Report of the Company. However, necessary information provided in this addendum to the notice of 34 Annual General Meeting.

MOREPEN LABORATORIES LIMITED

Regd. Off: Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, H. P.– 173205

CIN: L24231HP1984PLC006028; Website: www.morepen.com;

E-mail Id: investors@morepen.com; Tel No.: +91-01795-276201-03; Fax No.: +91-01795-276204

Form No. MGT – 11

PROXY FORM

[Pursuant to Section 105 (6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration) Rules, 2014]

	Name of the Member(s):
	Registered address:
	E-mail Id: Folio No. /DP ID & Client ID:

I/We, being the member(s) of the above named company holding ............ shares of Rs. ......... each, hereby appoint

1)	Name:	E-mail Id:
	Address:
		Signature: or failing him/her
2)	Name:	E-mail Id:
	Address:
		Signature:

th as my/our Proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 34 Annual General Meeting of the Company, to be held on Friday, the 13th day of September, 2019 at 10.00 a.m. at the Registered Office of the Company at Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, H. P. – 173205 and at any adjournment thereof in respect of such resolutions as are indicated below:

Item No.	Description	For	Against
1.	Adoption of Audited Financial Statement, including Consolidated Financial Statements, of st the Company for the financial year ended 31 March, 2019 together with the reports of the Directors' and Auditors' thereon.
2.	Appointment of a Director in place of Mrs. Anju Suri (DIN: 00042033), who retires by rotation at this Annual General Meeting and being eligible, offers herself for re-appointment.
3.	Increase in remuneration of Mr. Sushil Suri (DIN: 00012028), Chairman & Managing Director of the Company.
4.	Re-appointment of Dr. Arun Kumar Sinha (DIN: 00450783) as a Whole-Time Director of the Company.
5.	Re-appointment of Mr. Sukhcharan Singh (DIN: 00041987) as an Independent Director of the Company.

6.	Re-appointment of Mr. Manoj Joshi (DIN: 00036546) as an Independent Director of the Company.
7.	Re-appointment of Mr. Bhupender Raj Wadhwa (DIN: 00012096) as an Independent Director of the Company.
8.	Maintenance of Register of Members and other Statutory Registers at a place other than Registered Office of the Company.
9.	Increase in the limits of Loan and Investment under section 186(3) of the Companies act, 2013.
10.	Authorization for borrowings under Section 180 (1) (c) of the Companies Act, 2013.
11.	Creation of charge on assets under Section 180 (1) (a) of the Companies Act, 2013.
12.	Ratification of remuneration of M/s. Vijender Sharma & Co., Cost Accountants, as Cost Auditors of the Company.
13.	Appointment of Mr. Sanjay Suri (DIN: 00041590) as a Whole-Time Director of the Company.
14.	Appointment of Mr. Praveen Kumar Dutt (DIN: 06712574) as an Independent Director of the Company.

Signed this _______ day of _____________ 2019. Signature of Member(s): ___________________

Affix Revenue Stamp

NOTES:

• 1) Please put a 'X' in the appropriate column against the respective resolutions. If you leave the 'For' or 'Against' column blank against any or all the resolutions, your proxy will be entitled to vote in the manner as he/she thinks appropriate.
• 2) Pursuant to the provisions of Section 105 of the Companies Act, 2013, a person can act as a proxy on behalf of not more than fifty (50) members and holding in the aggregate not more than ten percent (10%) of the total Share Capital of the Company carrying voting rights. A member holding more than ten percent (10%), of the total Share Capital of the Company carrying voting rights may appoint a single person as proxy and such person shall not act as proxy for any other member.
• 3) This form of Proxy in order to be effective should be duly completed, stamped, signed and deposited at the Registered Office of the Company, not less than 48 hours before the commencement of the meeting.

MOREPEN LABORATORIES LIMITED

CIN : L24231HP1984PLC006028 Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh-173 205, Tel. No. : +91-01795-276201-03, Fax : +91-01795-276204 Email : investors@morepen.com Website : www.morepen.com The Joy Of Growing Together

ELECTRONIC VOTING PARTICULARS

EVEN (E-Voting Event Number)	USER ID	PASSWORD	NO. OF SHARES

The remote e-voting facility will be available during the following voting period:

Commencement of remote e-voting	From 09.00 a.m. (IST) on Monday, September 09, 2019
End of remote e-voting	Upto 05.00 p.m. (IST) on Thursday, September 12, 2019

The remote e-voting will not be allowed beyond the aforesaid date & time and the remote e-voting module shall be disabled by NSDL thereafter.

The cut-off date for the purpose of remote e-voting is Friday, September 6, 2019 (end of day).

--------------------------------------------------------- TEAR HERE ------------------------------------------------------

MOREPEN LABORATORIES LIMITED

CIN : L24231HP1984PLC006028 Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh-173 205, Tel. No. : +91-01795-276201-03, Fax : +91-01795-276204 Email : investors@morepen.com Website : www.morepen.com The Joy Of Growing Together

ATTENDANCE SLIP

Regd. Folio No. / DP ID - Client ID	: ______
Name & Address of First/Sole Shareholder	: ______
No. of Shares held	: ______

th I/We hereby record my/our presence at the 34 Annual General Meeting of the Company to be held on Friday, September 13, 2019 at 10.00 a.m. at Morepen Village, Nalagarh Road, Near Baddi, Distt. Solan, Himachal Pradesh - 173 205

Notes :

________________________ Signature of Member/Proxy

• a) Only Member/Proxy can attend the meeting. No minors would be allowed at the meeting.
• b) Member / Proxy who wish to attend the meeting must bring this attendance slip to the meeting and handover at the entrance duly lled in and signed.
• c) Corporate members intending to send their authorized representatives to attend the meeting are requested to send, to the Company, a certied copy of the Board Resolution authorizing their representative to attend and vote on their behalf at the meeting.