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Lupin Ltd.

BSE: 500257 Sector: Health care
NSE: LUPIN ISIN Code: INE326A01037
BSE LIVE 15:59 | 22 Nov 828.05 -9.65
(-1.15%)
OPEN

838.05

HIGH

842.00

LOW

825.00

NSE 15:57 | 22 Nov 827.40 -10.05
(-1.20%)
OPEN

838.60

HIGH

841.75

LOW

825.20

OPEN 838.05
PREVIOUS CLOSE 837.70
VOLUME 175928
52-Week high 1572.25
52-Week low 818.55
P/E 17.39
Mkt Cap.(Rs cr) 37,420
Buy Price 0.00
Buy Qty 0.00
Sell Price 828.05
Sell Qty 167.00
OPEN 838.05
CLOSE 837.70
VOLUME 175928
52-Week high 1572.25
52-Week low 818.55
P/E 17.39
Mkt Cap.(Rs cr) 37,420
Buy Price 0.00
Buy Qty 0.00
Sell Price 828.05
Sell Qty 167.00

Lupin Ltd. (LUPIN) - Auditors Report

Company auditors report

TO THE MEMBERS OF LUPIN LIMITED

Report on the Standalone Indian Accounting Standards (‘Ind AS') FinancialStatements

We have audited the accompanying standalone Ind AS financial statements of LupinLimited (‘the Company') which comprise the balance sheet as at 31 March 2017 thestatement of profit and loss (including other comprehensive income) the cash flowstatement and the statement of changes in equity for the year then ended and a summary ofthe significant accounting policies and other explanatory information (herein afterreferred to as "standalone Ind AS financial statements").

Management's Responsibility for the Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act 2013 ("the Act") with respect to the preparation ofthese standalone Ind AS financial statements that give a true and fair view of thefinancial position financial performance including other comprehensive income cash flowsand changes in equity of the Company in accordance with the accounting principlesgenerally accepted in India including the Indian Accounting Standards ("IndAS") prescribed under Section 133 of the Act read with relevant rules issuedthereunder. This responsibility also includes maintenance of adequate accounting recordsin accordance with the provisions of the Act for safeguarding of the assets of the Companyand for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgments and estimates that arereasonable and prudent; and design implementation and maintenance of adequate internalfinancial controls that were operating effectively for ensuring the accuracy andcompleteness of the accounting records relevant to the preparation and presentation ofthe standalone Ind AS financial statements that give a true and fair view and are freefrom material misstatement whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financialstatements based on our audit.

We have taken into account the provisions of the Act the accounting and auditingstandards and matters which are required to be included in the audit report under theprovisions of the Act and the rules made thereunder.

We conducted our audit of standalone Ind AS financial statements in accordance with theStandards on Auditing specified under Section 143(10) of the Act. Those Standards requirethat we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the standalone Ind AS financial statements are freefrom material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts andthe disclosures in the standalone Ind AS financial statements. The procedures selecteddepend on the auditor's judgment including the assessment of the risks of materialmisstatement of the standalone Ind AS financial statements whether due to fraud or error.In making those risk assessments the auditor considers internal financial controlrelevant to the Company's preparation of the standalone Ind AS financial statements thatgive a true and fair view in order to design audit procedures that are appropriate in thecircumstances. An audit also includes evaluating the appropriateness of the accountingpolicies used and the reasonableness of the accounting estimates made by the Company'sDirectors as well as evaluating the overall presentation of the standalone Ind ASfinancial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid standalone Ind AS financial statements give the informationrequired by the Act in the manner so required and give a true and fair view in conformitywith the accounting principles generally accepted in India including the Ind AS of thefinancial position of the Company as at 31 March 2017 and its financial performanceincluding other comprehensive income its cash flows and the changes in equity for theyear ended on that date.

Other matter

The comparative financial information of the Company for the year ended 31 March 2016and the transition date opening balance sheet as at 1 April 2015 included in thesestandalone Ind AS financial statements are based on the previously issued statutorystandalone financial statements prepared in accordance with the accounting principlesgenerally accepted in India including the Accounting standards specified under Section133 of the Act read with rule 7 of Companies (Accounts) Rules 2014 audited by thepredecessor auditor whose report for the year ended 31 March 2016 and 31 March 2015 dated19 May 2016 and 13 May 2015 respectively expressed an unmodified opinion on thosestandalone financial statements as adjusted for the differences in the accountingprinciples adopted by the Company on transition to the Ind AS which have been audited byus.

Our opinion is not modified in respect of the above matter.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in exercise of powers conferred by section 143(11) of the Act we enclose in "Annexure A" a statement on the mattersspecified in paragraphs 3 and 4 of the said Order to the extent applicable.

As required by Section 143 (3) of the Act we report that:

(a) We have sought and obtained all the information and explanations which to the bestof our knowledge and belief were necessary for the purposes of our audit; (b) In ouropinion proper books of account as required by law have been kept by the Company so faras it appears from our examination of those books; (c) The balance sheet the statement ofprofit and loss (including other comprehensive income) the cash flow statement andstatement of changes in equity dealt with by this Report are in agreement with the booksof account; (d) In our opinion the aforesaid standalone Ind AS financial statementscomply with the Indian Accounting Standards prescribed under Section 133 of the Act readwith relevant rules issued thereunder; (e) On the basis of the written representationsreceived from the directors as on 31 March 2017 and taken on record by the Board ofDirectors none of the directors are disqualified as on 31 March 2017 from being appointedas a director in terms of Section 164 (2) of the Act; (f) With respect to the adequacy ofthe internal financial controls over financial reporting of the Company and the operatingeffectiveness of such controls refer to our separate report in "Annexure B";and (g) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand to the best of our information and according to the explanations given to us: i. TheCompany has disclosed the impact of pending litigations on its financial position in itsstandalone Ind AS financial statements – Refer Note 35 to the standalone Ind ASfinancial statements; ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts. Refer note 59 to the standalone Ind AS financialstatements; iii. There has been no delay in transferring amounts required to betransferred to the Investor Education and Protection Fund by the Company; and iv. TheCompany has provided requisite disclosures in its standalone Ind AS financial statementsas to holdings as well as dealings in Specified Bank Notes during the period from 8November 2016 to 30 December 2016. Based on audit procedures and relying on the managementrepresentation we report that the disclosures are in accordance with books of accountmaintained by the Company and as produced to us by the Management. Refer Note 50 to thestandalone Ind AS financial statements.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
Venkataramanan Vishwanath
Place : Mumbai Partner
Dated : May 24 2017 Membership No: 113156

ANNEXURE - A TO THE INDEPENDENT AUDITOR'S REPORT - 31 MARCH 2017

(Refered to our report of even date)

(i) (a) The Company has maintained proper records showing full particulars includingquantitative details and situation of the fixed assets.

(b) The Company has a regular programme of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of three years. Inaccordance with this programme a portion of the fixed assets has been physically verifiedby the management during the year and no material discrepancies have been noticed on suchverification. In our opinion this periodicity of physical verification is reasonablehaving regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and based on theexamination of the registered sale deed / transfer deed / conveyance deed / sharecertificate / other documents evidencing title and provided to us we report that thetitle deeds of immovable properties of land and building which are freehold as disclosedin Note 2 to the standalone Ind AS financial statements are held in the name of theCompany except for the following:

Particulars of the land Gross Block Net Block Remarks
and building (as at 31 March 2017) (as at 31 March 2017)
( Rs. in million) (Rs. in million)
Freehold land located in Maharashtra admeasuring 7 Hectare and 70.91 Acre 29.6 29.6 The title deeds are in the name of the erstwhile Company that was amalgamated with the Company pursuant to the Scheme of amalgamation sanctioned by the Hon'ble Bombay High Court.
Freehold building located in Maharashtra admeasuring 8038 sqft 133.9 95.8 The title deeds are in the name of erstwhile Company that was amalgamated with the Company pursuant to the Scheme of amalgamation sanctioned by the Hon'ble Bombay High Court.

Immovable properties of land whose title deeds have been pledged as security for loanstaken in earlier years are held in the name of the Company based on the confirmationsdirectly received by us from lenders. In respect of immovable properties of land andbuildings that have been taken on lease and disclosed as fixed asset in Note 2 to thestandalone Ind AS financial statements the lease agreements are in the name of theCompany where the Company is the lessee in the agreement except the following:

Particulars of Gross Block Net Block Remarks
the building (as at 31 March 2017) (as at 31 March 2017)
(Rs. in million) ( Rs. in million)
Leasehold building located in Delhi admeasuring 1628 sqft 2.8 2.4 The title deeds are in the name of erstwhile Company that was amalgamated with the Company pursuant to the Scheme of amalgamation sanctioned by the Hon'ble Bombay High Court.

In respect of immovable properties of land and buildings which are disclosed as fixedasset in the financial statements the original documents are not available forverification details of which are as given below:

Particulars of the land and the Gross Block Net Block
building (as at 31 March 2017) (as at 31 March 2017)
( Rs. in million) (Rs. in million)
Building located in Maharashtra 7.5 5.4
Land located in Uttarakhand 0.3 0.3

(ii) Inventories apart from goods in transit and inventories lying with outside partieshave been physically verified by the Management during the year and the discrepanciesnoticed on such verification between the physical stock and book records were notmaterial. In our opinion the frequency of such verification is reasonable. Inventorieslying with outside parties has been substantially confirmed by them as at the year-end andno material discrepancies were noticed in respect of such confirmations.

(iii) In our opinion and according to information and explanations given to us theCompany has not granted any loans secured or unsecured to companies firms LimitedLiability Partnerships or other parties covered in the register maintained under section189 of the Companies Act 2013 (‘the Act'). Accordingly paragraph 3(iii) of theOrder is not applicable to the Company.

(iv) In our opinion and according to the information and explanation given to us theCompany has complied with the provisions of Section 185 and Section 186 of the Act inrespect of making investments and providing guarantees as applicable. The Company has notgranted any loans or provided any security to the parties covered under Section 185 andsection 186 of the Act. (v) In our opinion and according to the information andexplanations given to us the Company has not accepted any deposits as per the directivesissued by the Reserve Bank of India under the provisions of Sections 73 to 76 or any otherrelevant provisions of the Act and the rules framed there under. Accordingly paragraph3(v) of the Order is not applicable to the Company. (vi) We have broadly reviewed therecords maintained by the Company pursuant to the rules prescribed by the CentralGovernment for maintenance of cost records under Section 148 (1) of the Act for Drugs andPharmaceuticals Products and are of the opinion that prima facie the prescribed accountsand records have been made and maintained. However we have not made a detailedexamination of the records. (vii) (a) According to the information and explanations givento us and on the basis of our examination of the records of the Company amountsdeducted/accrued in the books of account in respect of undisputed statutory dues includingProvident fund Employees' state insurance Income tax Value added tax Sales taxService tax duty of Customs duty of Excise Cess and other material statutory dues havegenerally been regularly deposited during the year by the Company with the appropriateauthorities. According to the information and explanations given to us no undisputedamounts payable in respect of Provident fund Employees' state insurance Income taxValue added tax Sales tax Service tax duty of Customs duty of Excise Cess and othermaterial statutory dues were in arrears as at 31 March 2017 for a period of more than sixmonths from the date they became payable. (b) According to the information andexplanations given to us there are no dues of Income tax Sales tax Value added taxService tax duty of Customs duty of Excise Cess which have not been deposited with theappropriate authorities on account of any dispute other than those mentioned in Annexure Cto this report.

(viii) In our opinion and according to the information and explanations given to usthe Company has not defaulted in repayment of loans or borrowings to banks and government.The Company has not taken any loans or borrowings from financial institutions and has notissued any debentures.

(ix) The Company has not raised any money by way of initial public offer furtherpublic offer (including debt instruments) and term loans during the year. Accordingly theprovisions of Clause 3(ix) of the Order are not applicable to the Company. (x) Accordingto the information and explanation given to us no material fraud by the Company or on theCompany by its officers or employees have been noticed or reported during the course ofour audit.

(xi) According to the information and explanations give to us and based on ourexamination of the records of the Company the Company has paid/provided for managerialremuneration in accordance with the requisite approvals mandated by the provisions ofSection 197 read with Schedule V to the Act. (xii) In our opinion and according to theinformation and explanations given to us the Company is not a Nidhi company and the NidhiRules 2014 are not applicable to it. Accordingly paragraph 3(xii) of the Order is notapplicable to the Company.

(xiii) In our opinion and according to the information and explanations given to us andbased on our examination of the records of the Company transactions with related partiesare in compliance with the provisions of Sections 177 and 188 of the Act whereapplicable. The details of such related party transactions have been disclosed in thestandalone Ind AS financial statements as required under Indian Accounting Standard (IndAS) 24 Related Party Disclosures specified under Section 133 of the Act read with therelevant rules issued thereunder. (xiv) According to the information and explanations giveto us and based on our examination of the records of the Company the Company has not madeany preferential allotment or private placement of shares or fully or partly convertibledebentures during the year. Accordingly paragraph 3(xiv) of the Order is not applicableto the Company.

(xv) According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has not entered into non-cashtransactions with its directors or persons connected with them. Accordingly paragraph3(xv) of the Order is not applicable. (xvi) In our opinion and according to theinformation and explanations given to us the Company is not required to be registeredunder Section 45-IA of the Reserve Bank of India Act 1934. Accordingly paragraph 3 (xvi)of the Order is not applicable.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
Venkataramanan Vishwanath
Place : Mumbai Partner
Dated : May 24 2017 Membership No: 113156

ANNEXURE - B TO THE INDEPENDENT AUDITOR'S REPORT - 31 MARCH 2017 ON STANDALONE IND ASFINANCIAL STATEMENT

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section143 of the Companies Act 2013 ("the Act") We have audited the internalfinancial controls over financial reporting of Lupin Limited (‘the Company') as of 31March 2017 in conjunction with our audit of the standalone Ind AS financial statements ofthe Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India(‘ICAI'). These responsibilities include the design implementation and maintenanceof adequate internal financial controls that were operating effectively for ensuring theorderly and efficient conduct of its business including adherence to company's policiesthe safeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial information as required under the Companies Act 2013 (‘theAct').

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting based on our audit. We conducted our audit in accordancewith the Guidance Note and the Standards on Auditing issued by ICAI and deemed to beprescribed under section 143(10) of the Act to the extent applicable to an audit ofinternal financial controls both applicable to an audit of Internal Financial Controlsand both issued by the ICAI. Those Standards and the Guidance Note require that we complywith ethical requirements and plan and perform the audit to obtain reasonable assuranceabout whether adequate internal financial controls over financial reporting wasestablished and maintained and if such controls operated effectively in all materialrespects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system over financial reporting and their operatingeffectiveness. Our audit of internal financial controls over financial reporting includedobtaining an understanding of internal financial controls over financial reportingassessing the risk that a material weakness exists and testing and evaluating the designand operating effectiveness of internal control based on the assessed risk. The proceduresselected depend on the auditor's judgment including the assessment of the risks ofmaterial misstatement of the standalone Ind AS financial statements whether due to fraudor error. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internal financialcontrols system over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

A company's internal financial control over financial reporting is a process designedto provide reasonable assurance regarding the reliability of financial reporting and thepreparation of financial statements for external purposes in accordance with generallyaccepted accounting principles. A company's internal financial control over financialreporting includes those policies and procedures that (1) pertain to the maintenance ofrecords that in reasonable detail accurately and fairly reflect the transactions anddispositions of the assets of the company; (2) provide reasonable assurance thattransactions are recorded as necessary to permit preparation of financial statements inaccordance with generally accepted accounting principles and that receipts andexpenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financialreporting including the possibility of collusion or improper management override ofcontrols material misstatements due to error or fraud may occur and not be detected.Also projections of any evaluation of the internal financial controls over financialreporting to future periods are subject to the risk that the internal financial controlover financial reporting may become inadequate because of changes in conditions or thatthe degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system over financial reporting and such internal financial controlsover financial reporting were operating effectively as at 31 March 2017 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note issued by theICAI.

For B S R & Co. LLP
Chartered Accountants
Firm's Registration No: 101248W/W-100022
Venkataramanan Vishwanath
Place : Mumbai Partner
Dated : May 24 2017 Membership No: 113156

ANNEXURE - C TO THE INDEPENDENT AUDITOR'S REPORT - 31 MARCH 2017

Amounts of dues of Income tax sales tax Value added tax Service tax duty ofCustoms duty of Excise which have not been deposited with the appropriate authorities onaccount of any dispute

Name of the Statute Nature of Dues Forum where dispute is pending Period to which amount relates Amount demanded (Rs. million) Amount unpaid (Rs. million)
Income tax Income tax Commissioner of Income 2006-2012 840.7 0.9
Act 1961 tax (Appeals)
Central Excise duty- Customs Excise 2010 2011 581.6 13.3
Excise Act De-bonding and Service Tax and 2012
1944 related Appellate Tribunal
(CESTAT)
Excise duty- Customs Excise Various 82.2 78.9
Other and Service Tax
Appellate Tribunal
(CESTAT)
Excise duty- Commissioner 2007-2012 104.6 104.6
Other of Central Excise
(Appeals)
Service tax Customs Excise 2006-2008 55.7 55.4
credit matters and Service Tax
Appellate Tribunal
(CESTAT)
Additional Commissioner 2007-08 1.2 1.2
Central and Sales tax Sales Tax Tribunal 2000-01 33.0 29.6
various Value Added 2003-04
States' tax 2004-05
Sales Tax 2005-06
Acts 2006-07
and various 2007-08
States' 2009-10
Value 2010-11
Added Tax
Acts
Supreme Court 2002-03 7.2 -
2003-04
2005-06
Commissioner of 8.4 6.2
Sales Tax (Appeals)
High court 2000-01 0.5 0.5
2002-03 4.7 1.8
2004-05 6.9 3.6
Joint 2001-02 0.2 -
Commissioner
Deputy 1994-95 0.1 -
Commissioner 2000-01
Additional 1994-95 14.4 12.8
Commissioner 2010-11
2012-13
Assistant 2003-04 0.5 -
Commissioner
The Customs duty Customs Excise 2010-11 0.8 0.8
Customs and Service Tax
Act 1962 Appellate Tribunal
(CESTAT)