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Jubilant Life Sciences Ltd.

BSE: 530019 Sector: Health care
NSE: JUBILANT ISIN Code: INE700A01033
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VOLUME 4490
52-Week high 879.10
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P/E 126.30
Mkt Cap.(Rs cr) 10,160
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OPEN 607.60
CLOSE 635.95
VOLUME 4490
52-Week high 879.10
52-Week low 515.00
P/E 126.30
Mkt Cap.(Rs cr) 10,160
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Jubilant Life Sciences Ltd. (JUBILANT) - Director Report

Company director report

Your Directors are happy in presenting the Thirty Ninth Annual Report together with theAudited Standalone and Consolidated Financial Statements for the year ended March 312017.

OVERVIEW

Jubilant Life Sciences Limited (‘the Company' or ‘Jubilant') is an integratedglobal Pharmaceutical and Life Sciences company engaged in Pharmaceuticals Life ScienceIngredients and Drug Discovery Solutions. The Pharmaceuticals segment through itswholly-owned subsidiary Jubilant Pharma Limited is engaged in manufacture and supply ofActive Pharmaceutical Ingredients (‘APIs') Solid Dosage Formulations

Radiopharmaceuticals Allergy Therapy Products and

Contract Manufacturing of Sterile and Non-sterile products through 6 USFDA approvedmanufacturing facilities in India USA and Canada. The Life Science Ingredients segmentis engaged in Specialty Intermediates Nutritional Products and Life Science Chemicalsthrough 5 manufacturing facilities in India. The Drug Discovery Solutions segment providesproprietary in-house innovation and collaborative research and partnership forout-licensing through 3 world class research centres in India and USA. Jubilant LifeSciences Limited has a team of over 6500 multicultural people across the globe and iscommitted to deliver value to its customers across over 100 countries. The Company is wellrecognized as a ‘Partner of Choice' by leading pharmaceuticals and life sciencescompanies globally. For more information please visit the Company's website www.iubl.com.

RESULTS OF OPERATIONS AND STATE OF COMPANY'S AFFAIRS

FINANCIAL RESULTS

Particulars

Standalone

Consolidated

Year ended March 31 2017 Year ended March 31 2016 Year ended March 31 2017 Year ended March 31 2016
Total Revenue from Operations 26230 27910 60063 58933
Total Operating Expenditure 23050 24787 46610 46464
EBITDA 3180 3123 13453 12469
Other Income 519 617 248 134
EBITDA including Other Income 3699 3740 13701 12603
Depreciation and Amortisation Expense 811 870 2914 3467
Finance Costs 1743 2006 3411 3714
Profit after Depreciation and Finance Cost but before Exceptional Items 1145 864 7376 5422
Exceptional Item - (Gain)/ Loss - - - -
Tax Expenses 353 134 1630 1554
Reported Net Profit After Tax 792 730 5746 3868
Attributable to:
Shareholders of the Company - - 5756 3918
Non-Controlling Interests - - (10) (50)
Other Comprehensive Income (9) (8) (577) 731
Total Comprehensive Income for the period 783 722 5169 4599
Retained Earnings brought forward from previous year 7976 7761 16167 12606
Transfer on account of sale of Equity Instruments - - - 203
Adjustment on account of consolidation of Jubilant Employees Welfare Trust - - 12 14
Retained Earnings available for appropriation which the Directors have appropriated as follows: 8768 8491 21935 16741
- Dividend on Equity Shares 478 478 478 478
- Tax on Dividend on Equity Shares 581 371 97 97
- Transfer to Debenture Redemption Reserve 375 - 375 -
- Transfer to Legal Reserve - - 1 (1)
Retained Earnings to be carried forward 7857 7976 20984 16167

1After reversal of dividend distribution tax of ' 39 Million (March 31 2016: '60 Million) on account of dividend received during the year from a subsidiary company.

(i) Standalone Financials Revenue from Operations

In the Financial Year 2016-17 on standalone basis the Company recorded total Revenuefrom operations of ' 26230 Million.

International Revenues

International business contributed 40% to the Net Revenue from operations at ' 10365Million.

EBITDA

For the year ended March 31 2017 Earnings before Interest Taxes Depreciation andAmortisation (‘EBITDA') stood at ' 3699 Million with EBITDA margins at 14%.

Reported Net Profit/ Loss after Tax and EPS

Reported Net Profit after Tax was ' 792 Million in the Financial Year 2016-17. BasicEarnings Per Share (‘EPS') stood at ' 4.97.

(ii) Consolidated Financials

The Consolidated Financial Statements prepared in accordance with the provisions ofthe Companies Act 2013 (the ‘Act') SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 (the ‘Listing Regulations') and Ind-AS 110'Consolidated Financial Statements' prescribed under Section 133 of the Act form part ofthe Annual Report.

Performance Review

Our strong performance continued in the Financial Year 2016-17 and the Company reportedhighest ever revenue and profits during the year. The differentiated business modelfocusing on Specialty Pharmaceuticals (Injectables) has enabled us to deliver exceptionalresults and build a strong base for growth going forward in our Pharma business. TheCompany has generated strong operating cash flow which enabled reduction of debt and isexpected to deliver better results going forward. Our focus is to strengthen the BalanceSheet invest in strategic opportunities without increasing debt levels and build strongpipeline of products across our businesses.

Revenue from operations was the highest ever at ' 60063 Million up 2% YoY withInternational revenue at ' 42468 Million contributing 71% of the total revenue.Pharmaceuticals revenues were at ' 31167 Million up 8% YoY and contributing 52% to therevenues. Within this segment Specialty Pharmaceuticals (Injectables) displayed a growthof 11% YoY The Company believe that this growth is a testimony to our strategy and thebusiness model wherein we have been able to build multiple levers of exciting anddifferentiated businesses which have helped the business deliver robust performance. Thishas been aptly demonstrated in the consistent growth witnessed in SpecialtyPharmaceuticals (Injectables) despite strong headwinds in the US Generics business fromsupply chain consolidation. Life

Science Ingredients revenue stood at ' 27076 Million and contributed 45% to therevenue. Drug Discovery Solutions revenue improved 45% YoY to ' 1821 Million contributing3% of the revenue.

EBITDA was 9% higher YoY at record ' 13701 Million translating to margin improvementof 143 basis points at 22.8% as against 21.4% in the Financial Year 2015-16. This was ledby the Pharmaceuticals segment which reported EBITDA of ' 9751 Million a growth of 9%YoY with a margin of 31.3% as against the margin of 30.9% achieved last year. ThePharmaceuticals segment now contributes about 68% to the overall EBITDA.

Life Science Ingredients reported EBITDA of ' 4338 Million translating to EBITDAmargin of 16% an improvement from 15% in the Financial Year 2015-16. Drug DiscoverySolutions EBITDA was at ' 258 Million translating to EBITDA margin of 14.2%. Depreciationand amortization in the Financial Year 2016-17 was at ' 2914 Million as compared to '3467 Million in the Financial Year 2015-16. Finance cost stood at ' 3411 Million lowerby 8% YoY.

Net profit attributable to shareholders improved by 47% YoY at ' 5756 Million ascompared to ' 3918 Million in the Financial Year 2015- 16 with a Basic EPS of ' 36.93 ascompared to ' 25.10 in the Financial Year 2015-16.

From Balance Sheet perspective in the Financial Year 2016- 17 the Company repaid '5056 Million of Debt and the Net Debt stood at ' 36844 Million on a constant currencybasis.

DIVIDEND

The Board is pleased to recommend a dividend of 300% i.e. ' 3 per fully paid up equityshare of ' 1 for the year ended March 31 2017. Total dividend payout of ' 536 Millionincludes tax on dividend of ' 58 Million (net of reversal of dividend distribution tax of' 39 Million for the year ended March 31 2016 on account of dividend received during theyear from a subsidiary company). The payment of dividend is subject to approval of theshareholders at the forthcoming Annual General Meeting (‘AGM') of the Company.

CAPITAL STRUCTURE

(a) Share Capital

During the year there has been no change in the authorised subscribed and paid-upshare capital of the Company. As on March 31 2017 the paid-up share capital stood at '159281139 comprising of 159281139 equity shares of ' 1 each.

(b) Employees Stock Option Plans (ESOPs)

The Company has two employees stock option plans namely Jubilant Employees Stock OptionPlan 2005 ('Plan 2005') and JLL Employees Stock Option Plan 2011 ('Plan 2011'). During theyear there was no material change in Plan 2005 and Plan 2011 and both the plans are incompliance with the SEBI (Share Based Employee Benefits) Regulations 2014 (the 'SEBI ESOPRegulations').

Plan 2005: During the year 3700 Options were exercised by the option holders. As onMarch 31 2017 2867 Options were outstanding under the Plan 2005. Each Option entitlesthe holder to acquire five equity shares of ' 1 each of the Company at the exercise pricefixed at the time of grant being the market value as per the erstwhile SEBI (EmployeeStock Option Scheme and Employee Stock Purchase Scheme) Guidelines 1999 (the ‘SEBIGuidelines').

Plan 2011: During the year 337075 Options were exercised by the option holders. As onMarch 31 2017 71185 Options were outstanding under the Plan 2011. Each Option entitlesthe holder to acquire one equity share of ' 1 of the Company at the exercise price fixedat the time of grant being the market value as per the SEBI Guidelines.

No dilution of paid-up capital is expected due to exercise of Options as it isenvisaged to transfer the shares held by Jubilant Employees Welfare Trust to the employeeson exercise of Options.

The details pursuant to the SEBI ESOP Regulations have been placed on the website ofthe Company and weblink of the same is www.iubl.com/Uploads/image/499imeuf_esop_disclosure2017.pdf.

(c) Debentures

During the year the Company has offered issued and allotted Secured RedeemableNon-Convertible Debentures (‘NCDs') of ' 4950 Million on a private placement basis.NCDs are listed on Whole-sale Debt Market Segment of National Stock Exchange of IndiaLimited (‘NSE'). The net proceeds of the funds raised have primarily been used torefinance the existing debt of the Company.

SUBSIDIARIES

As on March 31 2017 the Company had 49 subsidiaries. Brief particulars of theprincipal subsidiaries are given below:

Jubilant Pharma Limited

Jubilant Pharma Limited Singapore (Jubilant Pharma') is a wholly-owned subsidiary ofyour Company. Jubilant Pharma holds the global pharmaceutical business of the Companythrough its subsidiaries in USA Canada Europe India and rest of the world. Thesesubsidiaries of Jubilant Pharma are engaged in manufacturing and marketing of variouspharmaceutical products and services like APIs oral dosage forms (tablets and capsules)contract manufacturing of sterile injectables ointment creams and liquids allergytherapy products and radiopharmaceutical products. Revenue of the company during theFinancial Year 2016-17 was ' 833.18 Million as compared to ' 521.90 Million during theFinancial Year 2015-16.

During the year Jubilant Pharma has through its debut issue raised US$ 300 Millionby offering 4.875% Rated Unsecured High Yield Bonds ('Notes') under Regulation S of the USSecurities Act of 1933. The Notes are listed on the Singapore Exchange Securities TradingLimited. The net proceeds of the funds raised have primarily been used to refinance theexisting debt of the Company and its subsidiaries.

Jubilant Generics Limited

Jubilant Generics Limited ('JGL') is a wholly-owned subsidiary of the Company throughJubilant Pharma. JGL owns two manufacturing facilities; one at Nanjangud Karnataka andanother at Roorkee Uttarakhand which are engaged in APIs and Dosage Forms businessrespectively.

The manufacturing location at Nanjangud spread on 69 acres is engaged in manufacturingof APIs and caters to the sales worldwide. API portfolio is focused on Lifestyle drivenTherapeutic Areas (CVS CNS) and also targets complex and newly approved molecules. Thecompany is market leader in four APIs and is amongst the top 3 players for another threeAPIs in its portfolio helping it maintain a high contribution margin. The manufacturinglocation at Roorkee Uttarakhand with 5 acres of infrastructure is USFDA Japan PMDA UKMHRA TGA WHO and Brazil ANVISA audited and approved. This business focusses on B2B modelfor EU Canada and emerging markets. It has capabilities to develop multiple dosage formsincluding Oral solid injectable and ophthalmic dosage forms. Revenue of the companyduring the Financial Year 2016-17 was ' 10726.09 Million as compared to ' 9197.82Million during the Financial Year 2015-16.

Jubilant Pharma Trading Inc.

This corporation incorporated in Delaware USA is a wholly- owned subsidiary ofJubilant Pharma. It undertakes sales and distribution of APIs in North America. Revenue ofthe company during the Financial Year 2016-17 was ' 1232.63 Million as compared to '1296.41 Million during the Financial Year 2015-16.

Cadista Holdings Inc. and Jubilant Cadista Pharmaceuticals Inc.

(i) Cadista Holdings Inc. ('Cadista') a corporation incorporated in Delaware USA is awholly-owned subsidiary of Jubilant Pharma Holdings Inc.

(ii) Jubilant Cadista Pharmaceuticals Inc. a corporation incorporated in Delaware USAis a wholly-owned subsidiary of Cadista. This company is in the business of manufacturingsolid dosage forms of generic pharmaceuticals at its U.S. Food and Drug Administration(‘USFDA') approved manufacturing facility in Salisbury Maryland USA. Its customerbase includes all the large wholesalers retail and grocery chains. Besides manufacturingits own label products it also provides product development and contract manufacturingservices. As on March 31 2017 there were 29 products marketed in the US with focus inthe therapeutic areas of CVS CNS Anti Allergic Steroids etc. Revenue of the companyduring the Financial Year 2016-17 was ' 5374.65 Million as compared to ' 5822.31 Millionduring the Financial Year 2015-16.

Jubilant HollisterStier LLC

This subsidiary is based in Spokane State of Washington USA. It is a wholly-ownedsubsidiary of HSL Holdings Inc.

This subsidiary has 2 businesses; Contract Manufacturing (CMO) and Allergenic Extracts.

In the contract manufacturing business of sterile injectables this company provides acomplete range of services to support drug manufacturing in the pharmaceutical andbiopharmaceutical industries. Its contract manufacturing capabilities include asepticliquid fill/ finishing and lyophilisation of small lot parenteral for commercial andclinical requirements. Its capabilities can be applied to a variety of projects frompre-clinical through commercial scale across a multitude of dosage forms includingmicrospheres suspensions WFI/ diluents biologics (proteins) lyophilized products andliposomes. Jubilant HollisterStier is approved across global regulated markets includingFDA (both CDER and CBER) Europe Japan Brazil and Canada. Its contract manufacturingbusiness serves customers including innovators ranging from small biotechnology to largepharmaceutical companies.

Additionally it is an innovator manufacturer and distributor of allergenic extractstargeted primarily at treating allergies and asthma. With nearly 100 years of leadershipin research extract production and immunotherapy products the organization is respectedworldwide in the field of allergy. Currently the business is comprised of allergenicextracts and mixes along with specialized skin test diagnostic devices. The business laysspecial emphasis on innovation towards introducing new products to treat and cureallergies. Revenue of the company during the Financial Year 2016-17 was ' 7133.07 Millionas compared to ' 6709.53 Million during the Financial Year 2015-16.

Jubilant DraxImage Inc.

Jubilant DraxImage Inc. (‘JDI') is a wholly-owned subsidiary of the Companythrough Jubilant Pharma. JDI develops manufactures and markets radiopharmaceuticals usedin Nuclear Medicine for the diagnosis treatment and monitoring of various diseases. Itserves hospital-based customers (Nuclear Medicine Physicians and Technologists) inaddition to specialized radiopharmacies and through them patients globally with highquality and reliable specialty products. The business is backed by a dedicated researchand development team specialized manufacturing strong regulatory affairs and commercialoperations. The areas of specialization include cardiac lung bone and thyroid diseases.JDI employs about 160 skilled professionals and is based in Montreal Canada where itoperates a manufacturing facility approved by USFDA and Health Canada.

JDI has earned and maintained market leadership in North America in several specialtyniche products including I-131 Therapeutic & Diagnostic capsules for imaging andtreatment of thyroid diseases and thyroid cancer Methylene- Diphosphonate (MDP) for boneimaging Macro-Aggregated Albumin (MAA) for lung imaging and Diethylene TriaminePenta-acetic Acid (DTPA) for renal and brain imaging. Recently JDI received approval fromUSFDA for RubyFill a cutting edge technology for PET myocardial perfusion imaging (MPI)under rest and pharmacological stress conditions to evaluate regional myocardial perfusionin adult patients with suspected or existing coronary artery disease. Revenue of thecompany during the Financial Year 2016-17 was ' 8112.66 Million as compared to ' 7049.54Million during the Financial Year 2015-16.

Jubilant DraxImage Limited

This is a wholly-owned subsidiary of the Company through Jubilant Pharma. JubilantDraximage Limited (‘JDI India') has been set up with a vision to cater to theRadiopharmaceutical and Nuclear Medicine field in India which lacks a structured focusfrom Pharmaceutical Industry. This company is engaged in marketing of innovativediagnostic imaging radiopharmaceutical solution and therapeutic radiopharmaceuticalproducts. Presently JDI India is marketing Lyophilized kits like Sestamibi DTPA MDP andMAA in rest of the world. It is also involved in distribution of wide range ofradioisotopes which include Tc-99m Generator (used in the diagnosis of Bone Cancer RenalImaging Cerebral Perfusion Imaging and Myocardial Perfusion Imaging) Thallium-201 andIodine-131 (Ranked 2nd in market share value wise in India) capsules andsolution (for the diagnosis and treatment of Thyroid and its related disease)Lutetium-177 and Gallium-68 generator (Ranked 2nd in market share value wise inIndia) via various partnerships across South Asia. The target customers are NuclearMedicine physicians Cardiologists and Oncologists of various hospitals and imaging labs.Revenue of the company during the Financial Year 2016-17 was ' 112.97 Million as comparedto ' 99.23 Million during the Financial Year 2015-16.

Jubilant Pharma NV

This is a wholly-owned subsidiary of the Company through JGL and Jubilant Pharma. Thiscompany holds shares of Jubilant Pharmaceuticals NV (99.8%) and PSI Supply NV (99.5%)along with Jubilant Pharma which holds the balance shares.

Jubilant Pharmaceuticals NV

This is a wholly-owned subsidiary of the Company through Jubilant Pharma NV Belgiumwhich holds 99.8% of its shares and Jubilant Pharma holds the balance shares. This companyis engaged in the business of licensing generic dosage forms and providing regulatoryservices to generic pharmaceutical companies. Revenue of the company during the FinancialYear 2016-17 was ' 35.12 Million as compared to ' 43.85 Million during the Financial Year2015-16.

PSI Supply NV

This is a wholly-owned subsidiary of the Company. 99.5% of its shares are held byJubilant Pharma NV and the balance by Jubilant Pharma. It is engaged in the supply ofgeneric dosage forms to the European markets. Revenue of the company during the FinancialYear 2016-17 was ' 219.50 Million as compared to ' 239.03 Million during the FinancialYear 2015-16.

Jubilant Life Sciences NV

This is a wholly-owned subsidiary of the Company. 99.99% of its shares are held by theCompany and the balance by Jubilant Infrastructure Limited. It is engaged in the supply ofbulk chemicals such as ethyl acetate acetic anhydride etc. and vitamins (feed and foodgrade) to the European markets.

Revenue of the company during the Financial Year 2016-17 was ' 3018.02 Million ascompared to ' 3341.75 Million during the Financial Year 2015-16.

Jubilant Biosys Limited

This company is a subsidiary of the Company through Jubilant Biosys (Singapore) Pte.Ltd. (a wholly-owned subsidiary of the Company). Jubilant Biosys (Singapore) Pte. Ltd.holds 66.98% equity of this company.

This company provides Drug Discovery Services to global pharmaceutical and biotechcompanies in:

• Standalone Service Model including functional services in the areas of In VitroBiology In Vivo Biology Structural Biology DMPK Toxicology and Discovery Informaticson Full Time Equivalent (FTE) or Fee For Service (FFS) based model;

• Collaborative/Partnership Model with integrated discovery program across asingle or a portfolio of molecules;

• In house proprietary model to develop assets that can be out-licensed underterms including research funding payments for scientific milestones achieved throughDiscovery and Development phase and royalties on successful commercialization of drugs.

Revenue of the company during the Financial Year 201617 was ' 887.26 Million ascompared to ' 588.47 Million during the Financial Year 2015-16.

During the Financial Year 2016-17 the Company acquired 186620000 12% OptionallyConvertible Non-cumulative Redeemable Preference Shares of ' 10 each of Jubilant BiosysLimited at par aggregating to ' 1866.20 Million. The loans granted earlier by the Companyhave been applied towards subscription money for the Preference Shares.

Jubilant Chemsys Limited

This company is a wholly-owned subsidiary of the Company through Jubilant DrugDevelopment Pte. Ltd. Singapore. This company offers services in Synthetic OrganicChemistry Combinatorial Chemistry Medicinal Chemistry Process Research &Development and Manufacturing Scale up services and GMP Manufacturing-Clinical Supply todrug discovery companies of US Europe and rest of the world on Full Time Equivalent FeeFor Service and Hybrid Model.

It also works closely with Jubilant Biosys Limited in collaborative drug discoveryresearch. Revenue of the company during the Financial Year 2016-17 was ' 988.78 Million ascompared to ' 662.42 Million during the Financial Year 2015-16.

Jubilant Clinsys Limited

Jubilant Clinsys Limited (‘JCL') is a wholly-owned subsidiary of the Companythrough Jubilant Drug Development Pte. Ltd. Singapore. Revenue of the company during theFinancial Year 2016-17 was ' 35.06 Million as compared to ' 25.54 Million during theFinancial Year 2015-16.

During the year JCL made an application to the National Company Law Tribunal(‘NCLT') to extinguish its preference share capital of ' 270.50 Million held by theCompany and payment of equivalent amount to the Company. The order of NCLT is awaited.

Jubilant Clinsys Inc.

This New Jersey based USA Corporation is a wholly-owned subsidiary of Jubilant PharmaHoldings Inc. This company provides Clinical Research Data Management services throughTrialStat platform. Revenue of the company during the Financial Year 2016-17 was ' 17.40Million as compared to ' 37.62 Million during the Financial Year 2015-16.

Jubilant Discovery Services Inc.

This Delaware based USA Corporation is a wholly-owned subsidiary of Jubilant BiosysLimited.Thiscompanyis providing Ion channel screening services using electrophysiology. Italso performs Assay development medium-high-throughput screening comprehensivecell-culture services under FTE and FFS business models. Apart from these services italso provides sales marketing and liaising services to Jubilant Biosys Limited andJubilant Chemsys Limited. Revenue of the company during the Financial Year 2016-17 was '176.04 Million as compared to ' 133.21 Million during the Financial Year 2015-16.

Jubilant Infrastructure Limited

This wholly-owned subsidiary of the Company had entered into a Memorandum ofUnderstanding ('MOU') with the Government of Gujarat during the Vibrant Gujarat'conference in 2007 for development of Sector Specific Special Economic Zone ('SEZ') forChemicals in Gujarat. About 107 hectares land was taken on lease from Gujarat IndustrialDevelopment Corporation ('GIDC') in Bharuch District Gujarat.

This SEZ became operational in October 2011 with the best in class infrastructurefacilities and utility plants like Boiler Gas Turbine Effluent Treatment Incineratorand DM Water.

The Company has two units in this SEZ. The finished products of Unit-1 and Unit-2 arefully backward integrated and are using in-house developed innovative technologies.

The global scale plants of Vitamin B3 and 3-Cyanopyridine at SEZ make your Company thelargest producer of Vitamin B3 in India and the second largest globally. Revenue of thecompany during the Financial Year 2016-17 was ' 715.99 Million as compared to ' 889.10Million during the Financial Year 2015-16.

Jubilant Life Sciences (USA) Inc.

This corporation incorporated in Delaware USA is a wholly- owned subsidiary of theCompany. It undertakes sales and distribution of advance intermediates nutritioningredients and fine chemicals in North America. Revenue of the company during theFinancial Year 2016-17 was ' 1508.07 Million as compared to ' 1506.87 Million during theFinancial Year 2015-16.

Jubilant Life Sciences (Shanghai) Limited

This wholly-owned subsidiary of the Company is held through Jubilant Life SciencesInternational Pte. Limited. It undertakes sales and distribution of products in China.This company is engaged in trading of advance intermediates (pyridine and itsderivatives) specialty ingredients and nutrition products. It is catering topharmaceutical animal feed and agrochemical industries in China. This subsidiary is alsoa sourcing hub of raw materials for your Company. Revenue of the company during theFinancial Year 2016-17 was ' 1036.30 Million as compared to ' 1325.07 Million during theFinancial Year 2015-16.

Jubilant DraxImage Radiopharmacies Inc.

During the year Jubilant DraxImage Radiopharmacies Inc. (‘JDRI') was incorporatedas a wholly-owned subsidiary of the Company through Jubilant Pharma Holdings Inc. toundertake speciality pharma business in the United States.

JDRI has signed an Asset Purchase Agreement with Triad Isotopes Inc. and its parentIsotope Holdings Inc. (‘Triad') to acquire substantially all of the assets whichcomprise the radiopharmacy business of Triad. The closing of the transaction is subject tocustomary closing conditions including contract regulatory and other approvals. This isthe second largest radiopharmacy network in the US with more than 50 pharmaciesdistributing nuclear medicine products to the largest National GPOs regional healthsystems standalone imaging centres cardiologists and hospitals. The acquisition willprovide Jubilant with direct access to hospital networks with ability to deliver more than3 million patient doses annually through approximately 1700 customers. The acquisitionwill facilitate Jubilant forward integrate in the radiopharmaceutical business.

Jubilant Pharma Australia PTY Limited

During the year Jubilant Pharma Australia PTY Limited (‘JPA') was incorporated asa wholly-owned subsidiary of the Company through Jubilant Pharma. JPA has been set up tomake regulatory filings in its own name in timely and efficient manner. This will enableJubilant to carry on its pharma business in Australia in an effective manner. JPA willcontinue to follow a B2B partnership model for marketing its products in Australia.

Other subsidiaries are mentioned below:

Jubilant Innovation Pte. Limited

Jubilant Biosys (Singapore) Pte. Limited

Jubilant Drug Development Pte. Limited

Drug Discovery and Development Solutions Limited

Jubilant Life Sciences International Pte. Limited

Jubilant Innovation (BVI) Limited

Jubilant Life Sciences (BVI) Limited

Jubilant Biosys (BVI) Limited

Jubilant Innovation (USA) Inc.

Jubilant Pharma Holdings Inc.

HSL Holdings Inc.

Draxis Pharma LLC

Jubilant DraxImage (USA) Inc.

Draximage LLC (Merged into Jubilant DraxImage (USA) Inc. effective from April 1 2017)

Deprenyl Inc. USA (Merged into Jubilant DraxImage (USA) Inc. effective from April 12017)

Jubilant HollisterStier Inc.

Draximage Limited Cyprus

Draximage Limited Ireland

6963196 Canada Inc.

6981364 Canada Inc.

DAHI Animal Health (UK) Limited

Draximage (UK) Limited

Jubilant Drug Discovery & Development Services Inc.

Jubilant Life Sciences (Switzerland) AG

Vanthys Pharmaceutical Development Private Limited

Jubilant Innovation (India) Limited

Jubilant First Trust Healthcare Limited

PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES

The performance and financial position of the subsidiaries are given in Form AOC-1attached to the Financial Statements for the year ended March 31 2017.

PARTNERSHIPS

Jubilant HollisterStier General Partnership

It is a Canada based partnership managed by two subsidiaries of the Company - JubilantHollisterStier Inc. and Draxis Pharma LLC. This partnership provides contractmanufacturing services. It manufactures products in two categories: sterile products andnon-sterile products. Sterile products include liquid and freeze-dried (lyophilized)injectables and sterile ointments and creams. Non-sterile products include nonsterileointments creams and liquids.

Draximage General Partnership

It is a partnership based in Canada managed by two Canadian subsidiaries of the Companyi.e. Jubilant Draximage Inc. (90%) and 6981364 Canada Inc. (10%).

STATUTORY AUDITORS

M/s B S R & Co. LLP Chartered Accountants ('BSR') were appointed as the StatutoryAuditors of the Company at the 36th AGM of the Company to hold office until theconclusion of AGM to be held in the year 2018 subject to ratification by the members atevery AGM. BSR has confirmed that ratification of their appointment if made at theensuing AGM shall be in accordance with the conditions specified in the Act.

The Auditors' Reports for the Financial Year 2016-17 do not contain any qualificationreservation adverse remark or disclaimer.

COST AUDIT

Pursuant to Section 148 of the Act read with the Companies (Cost Records and Audit)Rules 2014 the Central Government has prescribed audit of cost records for certainproducts. Accordingly the Company needs to carry out cost audit of its products. Based onthe recommendations of the Audit Committee the Board of Directors has re-appointed M/s J.K. Kabra & Co. Cost Accountants as Cost Auditors of the Company to conduct cost auditfor the Financial Year 2016-17.

SECRETARIAL AUDIT

The Board had appointed M/s Sanjay Grover & Associates Company Secretaries toconduct Secretarial Audit pursuant to the provisions of Section 204 of the Act for theFinancial

Year 2016-17. The Report of the Secretarial Auditors is attached as Annexure-1 tothis Report and does not contain any qualification reservation adverse remark ordisclaimer.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Mr. Hari S Bhartia was re-appointed as Co-Chairman and Managing Director of the Companyfor a period of 5 years effective from April 1 2017 by the Shareholders at the AGM heldon August 30 2016. Mr. Hari S Bhartia retires by rotation at the forthcoming AGM andbeing eligible offers himself for re-appointment.

The Board has appointed Mr. Pramod Yadav as Whole-time Director of the Company for aperiod of 2 years effective from April 1 2017 subject to approval of the Shareholders atthe ensuing AGM.

The Board has at its meeting held on May 23 2017 appointed Mr. Sushil Kumar Roongtaand Mr. Vivek Mehra as Additional Directors in the category of Independent Directors andMr. Priyavrat Bhartia and Mr. Arjun Shanker Bhartia as Additional Directors in thecategory of Non-Executive Directors.

Mr. Shardul S Shroff resigned from the Board of Directors of the Company effective fromMay 24 2016. Mr. Shyamsundar Bang resigned as Executive Director of the Company effectivefrom February 7 2017 on his superannuation from the services of the Company. He continuedas Non-Executive Director of the Company till March 31 2017.

MEETINGS OF THE BOARD

Four meetings of the Board of Directors of the Company were held during the FinancialYear 2016-17.

DECLARATION OF INDEPENDENT DIRECTORS

All Independent Directors have given declaration that they meet the criteria ofindependence as provided under Section 149 of the Act and Regulation 16 of the ListingRegulations.

APPOINTMENT AND REMUNERATION POLICY

The Company has implemented Appointment and Remuneration Policy pursuant to theprovisions of Section 178 of the Act and Regulation 19 read with Schedule II Part D ofthe Listing Regulations. The Policy has been disclosed in the Corporate Governance Reportattached to this Report.

ANNUAL PERFORMANCE EVALUATION OF THE BOARD

A statement on annual evaluation by the Board of its performance and performance of itsCommittees as well as individual Directors forms part of the Corporate Governance Reportattached to this Report.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors based on the representation received from the management confirm that:

(i) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as on March 31 2017 and of the profitsof the Company for the year ended March 31 2017;

(iii) the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the annual accounts on a going concern basis;

(v) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively.

Based on the framework of internal financial controls including the Controls Managerfor financial reporting and compliance systems established and maintained by the Companywork performed by the internal statutory and secretarial auditors and the reviewsperformed by the management and the relevant Board committees including the AuditCommittee the Board is of the opinion that the Company's internal financial controls wereadequate and effective during the Financial Year 2016-17;and

(vi) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

COMPOSITION OF AUDIT COMMITTEE

As on date the Audit Committee comprises Mr. S Sridhar Chairman Ms. Sudha Pillai andDr. Ashok Misra. The Board has accepted all the recommendations made by the AuditCommittee.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Information relating to Conservation of Energy Technology Absorption and ForeignExchange Earnings and Outgo required to be disclosed pursuant to Section 134 of the Actread with the Companies (Accounts) Rules 2014 is given as Annexure-2 and formspart of this Report.

EMPLOYEES

Particulars of Directors and Employees as required under Section 197(12) of the Actread with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 as amended are given as Annexure-3 and form part of this Report.

RISK MANAGEMENT AND INTERNAL CONTROL SYSTEMS

Risk-taking is an inherent trait of any enterprise. However if risks are not properlymanaged and controlled they can affect the Company's ability to attain its objectives.Risk management and internal financial control systems play a key role in directing andguiding the Company's activities by continually preventing and managing risks. The BoardAudit Committee and Senior Management team collectively set the overall tone and riskculture of the Company by identifying the risks impacting the Company's business anddocumenting the process of risk identification risk minimization and risk optimization asa part of the risk management policy through defined and communicated corporate valuesclearly assigned risk responsibilities appropriately delegated authority and a set ofprocesses and guidelines.

There exists a critical risk management framework across the Company and the same isreviewed on a periodic basis by the Board. Some of the critical risks identified invarious businesses of the Company are:

• Competition Cost Competitiveness and Pricing

• Dependence on Certain Key Products and Customers

• Foreign Currency and Interest Rate Exposures

• Capacity Planning and Optimisation

• Manufacturing Operations

• Dependence on Single Manufacturing facility

• Research & Development Effectiveness

• Supply Interruptions due to Single Source Supplier

• Limited Product Pipeline

• Failure to Supply to Customers

• Human Resources- Acquire and Retain Talent

• Compliance and Regulatory

• Environment Health and Safety

• Protecting Intellectual Property Rights

• Information Technology

• Risk of changes in Tax Legislation

• Mergers & Acquisitions

• Political or Economic Instability or Acts of Terrorism

• Duties by Export Destination Countries

• Acceptance of Our Products in Market

• Policies regarding returns allowances and chargebacks in the United States

• Labour Unions

• Consolidation of Customer Base

The Company promotes strong ethical values and high levels of integrity in all itsactivities which in itself is a significant risk mitigator. With the growth strategy inplace risk management holds the key to the success of the Company's journey of continuedcompetitive sustainability in attaining the desired business objectives.

Implementation of Internal Financial Controls

To compete globally world class Corporate Governance and Financial Controls overoperations are a must for the Company. The Internal Financial Controls as mandated by theAct not only require a certification from CEO-CFO but also put an obligation on the Boardof Directors to ensure that the Internal Financial Controls are adequate and operatingeffectively. Besides this the Statutory Auditors are also required to give an opinion onthe adequacy and effectiveness of Internal Controls over Financial Reporting(‘ICFR').

To make the Internal Financial Controls framework robust the Company has worked onthree lines of defense strategy which is as under:

- First Line of Defense: Build internal controls into operating processes - To thisend we have ensured that a detailed Delegation of Authority is issued Standard OperatingProcedures for the processes are created financial decision making is done throughCommittees IT controls are built into the processes Segregation of Duties is donestrong budgetary control framework exists the Entity level controls including Code ofConduct Ombudsman Office are put in place etc.

- Second Line of Defense: Create an efficient review mechanism - We created a reviewmechanism under which all the business units and functions are reviewed for performance atleast once in a month by the respective CEOs and once in a quarter by the Corporate team.The formats for these reviews are detailed and finalized with the help of globalconsulting firms.

- Third Line of Defense: Independent assurance - A Big Four firm has been appointed asour internal auditors to perform systematic independent audit of every aspect of thebusiness to provide independent assurance on the effectiveness of the internal controlsand highlight the gaps for continuous improvement.

We have implemented a programme under which more than 2000 financial controls areestablished and certified on a quarterly basis by the relevant process owners before thefinancial results are closed for the quarter. A quarterly certification process ismaintained through a work flow based IT tool called ‘Controls Manager' and thiscertification is the basis of the CEO-CFO certification stipulated by Regulation 17(8)read with Part B of Schedule II to the Listing Regulations.

The Company regularly updates the controls library and Risk and Control Matrix. Theexercise of review of controls was conducted during the year by the in-house processowners with the help of a Big Four firm. The revised control framework after such reviewwas tested for operational effectiveness by the Statutory Auditors and they have given anaffirmative opinion about the adequacy and effectiveness of the Internal Controls forFinancial Reporting in the Company.

The Company has three business segments namely

(a) Pharmaceuticals (b) Life Science Ingredients and (c) Drug Discovery Solutions. Eachsegment has a complete management set up with CEO CFO and other functional heads who areresponsible for running the operations and report to the Chairman/Co-Chairman and ManagingDirector and the Corporate Committee.

To improve the controls in operations we have established for each line of businessthe concept of financial decision making through operational committees.

A detailed note on Internal Control Systems and Risk Management is given under ‘ManagementDiscussion and Analysis Report'.

CERTIFICATIONS

The Company has received Responsible Care14001:2013 certification under the AmericanChemistry Council's (ACC) Responsible Care program for Corporate Office in Noida andGajraula Manufacturing facility. Implementation of RC14001 and Responsible Care ManagementSystem by Jubilant demonstrates its commitment to employee health and safety communityand the environment.

Responsible Care initiative encompasses comprehensive environmental management systemoccupational health and safety product stewardship security community outreach andtransportation safety and aims at achieving and sustaining high standards of performance.

Gajraula Nira Bharuch and Savli Manufacturing facilities are certified underIntegrated Management System program for ISO 9001 (Quality Management System) ISO 14001(Environmental Management System) and OHSAS 18001 (Occupational Health and SafetyManagement system).

Gajraula

Gajraula Quality Control Laboratory has also been accredited by National AccreditationBoard for Testing and Calibration Laboratories in accordance with the ISO/ IEC 17025:2005.The Carbon Dioxide manufacturing facility has been certified for FSSC 22000:2005 and TS22002-01:2009 (Food Safety System Certification) for production and dispatch of food gradeCarbon Dioxide for Beverages. Carbon Dioxide product is approved by Food Safety andStandards Authority of India (FSSAI).

Gajraula manufacturing facility has been Kosher and also Halal Certified for keyproducts going in for human consumption.

Savli

Animal Nutrition Unit at Savli is certified for FAMI-QS Code Version 5.1 in Feed SafetyManagement System.

Ambernath

Ambernath Manufacturing facility is ISO 9001:2008 certified for Quality ManagementSystem.

Bharuch

Bharuch Site has received Energy Management System Certification ISO 50001:2011 forenergy Conservation programme (ENCON).

Vitamins plant at Bharuch is certified for FAMI-QS Code Version 5.1 in Feed SafetyManagement System Kosher Halal-India Halal-Malaysia Halal-Indonesia FSSC 22000(Global Food Safety) Compliance Hazard Analysis and Critical Control Points ('HaCcP') andGood Manufacturing Practices ('GMP').

Nira

Acetyl manufacturing facility at Nira has been recommended for FSSC/ ISO 22000:2005(Food Safety System Certification) for production and dispatch of these food gradeproducts. Further Glacial acetic acid from Nira has been recommended to FSSC /ISO22000:2005 for storage and supply of food grade acetic acid. Manufacturing facility atNira has been Kosher approved and Halal certified for the products manufactured at thefacility.

HUMAN RESOURCES

Our employees remain at the core of the Company's growth strategy and play a vital rolein ensuring sustainable business growth and future readiness. The Company has beenfocusing on strengthening its talent management and employee engagement processes throughclear role expectations with specific and well defined Key Performance Indicators for eachrole. We believe in creating a culture of performance and merit that provides all ouremployees with opportunities to excel learn and progress. We have been focusing onattracting the best talent from India's leading campuses to have a steady flow of freshtalent thereby creating a strong pool of internal talent.

Our well defined Leadership Competency Framework lays tremendous focus on outlining acommon leadership culture throughout the organization. All our initiatives are backed byan action oriented development plan. The development initiatives lay the foundation of ourtalent pipeline.

Last year we participated in the Great Place to Work survey. The results of the surveyhas enabled us to re-design our practices and address areas that concern our employees.

As on March 31 2017 a total of 384 employees at our manufacturing plants at SavliNira and Gajraula were either members of unions or had collective bargaining capabilities.During the year we enjoyed cordial relations with our employees and there have been noinstances of labour unrest or disputes at any of the manufacturing sites.

The Company has a Policy on Prevention of Sexual Harassment at workplace and theCompany has not received any complaint during the year under the Sexual Harassment ofWomen at Workplace (Prevention Prohibition and Redressal) Act 2013.

A detailed note on Human Resource Management is given in the 'Management Discussionand Analysis Report'.

INVESTOR SERVICES

With a view to keep its investors well informed of its activities the Company hastaken the following initiatives:

• E-mailing quarterly results and press releases to the Shareholders soon afterthey are sent to the stock exchanges and e-mailing Annual Reports. Maintaining userfriendly Investor Section on the website of the Company www.jubl.com:

• A dedicated e-mail address viz. investors@iubl.com for interacting on variousmatters with respect to share transfer transmission dividends and other related issueswith the Company Secretary and Compliance Officer;

• Mailing feedback forms to the investors on an annual basis so as to obtainvaluable feedback and suggestions for improvement. The Company has also placed an onlineInvestor Feedback form on its website www.jubl.com under the head 'Investor Feedback Form'to facilitate electronic submission of the Form;

• Earnings Presentation and Release detailing the quarterly results that areuploaded on the website www.jubl.com. Earnings call is typically conducted postannouncement of results to the stock exchanges as per the schedule mentioned in theConcall Invite which is also uploaded on the website of the Company. Earnings callsplayback is made available on the link shared in the Concall Invite and transcripts areuploaded on the website of the Company;

• Meeting the investors and analysts from time to time at their request;

• The presentation and meeting schedule of Roadshows attended by the Company areuploaded on its website after intimating the same to the Stock Exchanges; and

• Disclosure made to the Stock Exchanges are promptly uploaded on the website ofthe Company for information of the Investors.

AWARDS AND ACCOLADES

During the year various awards and accolades were received by the Company like:

• 17th CII National Award for Excellence in Energy conferred under theChemical/Pharma/Fertilizers category - Gajraula Plant India;

• Sustainability Award for ‘Best Green Process' in Chemical sector in FICCIChemicals & Petrochemicals Awards 2016 - Gajraula Plant India;

• ICC Certificate of Merit for continuous efforts of ‘water resourcesmanagement in chemical industries'- Gajraula Plant India; and

• One Gold and Three Silver Awards in Kaizen Category at Quality Circle Forum ofIndia Ankleshwar Gujarat - Bharuch Plant India.

VIGIL MECHANISM

The details of Vigil Mechanism (Whistle Blower Policy) adopted by the Company have beendisclosed in the Corporate Governance Report attached to this Report and which forms anintegral part of this Report.

GREEN INITIATIVES

With the aim of going green and minimising our impact on the environment the Companycontinued with the green initiatives in its operations which include:

• Conducting paperless Board/ Committee Meetings;

• Uploading the Corporate Sustainability Report on the website of the Company(instead of circulating in paper or CD form) and providing its weblink to the Shareholdersalongwith the Annual Report; and

• E-mailing Annual Reports to the Shareholders whose e-mail addresses are providedby the depositories or who have opted for the electronic version.

CORPORATE SOCIAL RESPONSIBILITY

Jubilant's approach to sustainable development focuses on the triple bottom line ofEconomic Environmental and Social performance. Corporate Social Responsibility ('CSR') isan integral part of the social performance of the Company. At Jubilant CSR is thecommitment of the Company to contribute towards inclusive growth. The thrust of CSRinitiatives is to create value in the lives of the communities around the area ofoperations of the Company which is an important stakeholder. Following are the highlightsof CSR at Jubilant:

• During the Financial Year 2016-17 Jubilant continued its CSR initiatives invarious sectors;

• Following the approach of ‘triple bottom line' Jubilant has beenpublishing its Corporate Sustainability Report every year from 2003 onwards. The report isexternally verified and is in accordance with Global Reporting Initiative (‘GRI')guidelines; and

• Acknowledged application level A+ by GRI for our Corporate Sustainability Reportsince 2007 onwards. Latest report is in accordance with GRI G4 - Comprehensive. All ourreports are available on the Company's website www.jubl.com.

CSR initiatives of the Company are conceptualized and implemented through JubilantBhartia Foundation ('JBF') the social wing of Jubilant Bhartia Group established in 2007as a not-for-profit organization. JBF works on 4P model (Public-Private-People-Partnership) for empowering communities and believes that for sustainablesocial intervention participation of communities must be ensured in the Company's CSRprojects/ programmes. Jubilant's role is to act as a catalyst and facilitate the process.The social initiatives of the Company are in line with the United Nations SustainableDevelopment Goals.

JBF in partnership with Schwab Foundation for Social Entrepreneurship has beenconferring Social Entrepreneur of the Year (SEOY) Award in India since the year 2010. Theaward celebrates mature-stage social entrepreneurs and their organizations that implementinnovative sustainable and large-scale solutions to address poverty indignity and lackof basic services and resources in ‘Bottom of the Pyramid' and ultra-poorcommunities. They work in areas as diverse as health education job creation waterclean energy building identity and entitlements and access to information and technology.Whether they set up social businesses hybrid social ventures or not-for-profitorganizations the primary focus of social entrepreneurs is large-scale transformationalimpact.

SEOY does not fall in the purview of CSR activities pursuant to the provisions ofSchedule VII to the Act. The Company shall however continue to confer the SEOY awardover and above CSR budget of the Company in view of the social benefits of the award.

JBF's detailed activities are available on its websitewww.iubilantbhartiafoundation.com. Annual Report on CSR including contents of the CSRPolicy is attached as Annexure-4 to this Report.

The Listing Regulations have mandated inclusion of the Business Responsibility Report(‘BR Report') as part of the Annual Report starting from the Financial Year 2016-17for top 500 listed entities based on market capitalisation. In compliance with the ListingRegulations BR Report forms part of the Annual Report.

During the Financial Year 2015 Jubilant Pharma had taken loan from InternationalFinance Corporation ('IFC'). Jubilant Pharma had ensured compliance towards theEnvironmental and Social Action Plan suggested by IFC post Environment and Social DueDiligence. Jubilant Pharma is also submitting Annual Monitoring Report ('AMR') to IFCcontaining detailed environment and social performance of the company with respect to theIFC Performance Standards in a timely manner. The AMR also includes the latest compliancestatus towards the Environmental and Social Action Plan recommended by IFC during theirannual E&S supervision visit.

OTHER DISCLOSURES

i. Extracts of Annual Return: Pursuant to the provisions of Section 92 of the Act readwith Rule 12 of the Companies (Management and Administration) Rules 2014 extract of theAnnual Return is attached as Annexure-5 to this Report.

ii. Public Deposits: No deposits have been accepted by the Company during the year fromthe public. The Company had no outstanding overdue unpaid or unclaimed deposits at thebeginning and end of the Financial Year 2016-17.

iii. Loans Guarantees and Investments: Details of loans guarantees/ securities andinvestments along with the purpose for which the loan guarantee or security is proposedto be utilised by the recipient have been disclosed in Note nos. 5 6 11 40 and 41 tothe Standalone Financial Statements.

iv. Particulars of Contracts or Arrangements with the Related Parties: The Company hasformulated a policy on Related Party Transactions (‘RPTs') dealing with the reviewand approval of RPTs. Prior omnibus approval is obtained for RPTs which are of repetitivenature. All RPTs are placed before the Audit Committee for review and approval.

All RPTs entered into during the Financial Year 2016-17 were in the ordinary course ofbusiness and on arm's length basis. No material RPTs were entered into during theFinancial Year 2016-17 by the Company as defined in the Policy on Materiality of RelatedParty Transactions. Accordingly the disclosure of RPTs as required under Section134(3)(h) of the Act in Form AOC-2 is not applicable. Your Directors draw attention of themembers to Note no. 37 to the Standalone Financial Statements which sets out the RelatedParty disclosures.

v. Material Changes in Financial Position: No material change or commitment hasoccurred after the close of the Financial Year 2016-17 till the date of this Report whichaffects the financial position of the Company.

vi. Orders passed by Courts/ Regulators: No significant or material order has beenpassed by the regulators or courts or tribunals impacting the going concern status of theCompany or its future operations.

CORPORATE GOVERNANCE

As a responsible corporate citizen the Company is committed to maintain the higheststandards of Corporate Governance and believes in adhering to the best corporate practicesprevalent globally.

A detailed Report on Corporate Governance is attached as Annexure-6 and formspart of this Report. A certificate from a Practising Company Secretary confirmingcompliance with the conditions of Corporate Governance as stipulated in Clause E ofSchedule V to the Listing Regulations is attached to the Corporate Governance Report.

The Board Members and Senior Management Personnel have affirmed compliance with theCode of Conduct for Directors and Senior Management for the year ended March 31 2017. Acertificate from the Co-Chairman & Managing Director confirming the same is attachedto the Corporate Governance Report.

A certificate from the CEO and CFO confirming correctness of the financial statementsadequacy of internal control measures etc. is also attached to the Corporate GovernanceReport.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis Report on the operations of the Company asprovided under the Listing Regulations has been given separately and forms part of thisReport.

ACKNOWLEDGMENTS

Your Directors acknowledge with gratitude the co-operation and assistance received fromthe Central and State Government authorities. Your Directors thank the shareholdersdebentureholders financial institutions banks/ other lenders debenture trusteescustomers vendors and other business associates for their confidence in the Company andits management and look forward to their continued support. The Board wishes to place onrecord its appreciation for the dedication and commitment of the Company's employees atall levels which has continued to be our major strength. We look forward to theircontinued support in the future.

For and on behalf of the Board

Shyam S Bhartia Hari S Bhartia
Chairman Co-Chairman & Managing Director
(DIN: 00010484) (DIN: 00010499)
Place: Noida
Date: May 23 2017