Dear Shareholders

Your Directors have pleasure in presenting the 37 ^th AnnualReport on business operations and achievements of the company together with the auditedfinancial statements for the financial year ended 31^st March 2022.

FINANCIAL HIGHLIGHTS

(Rs in Lakhs)

REVIEW OF PERFORMANCE

During the current year ending 31^st March 2022 the companyrecorded consolidated annual revenues of Rs 155713.41 Lakhs a growth 30% from previousyear revenues of Rs 120012.53 Lakhs.

The export revenues at Rs 55886.94 Lakhs 36% of current year salesrevenues went up by 17% whereas domestic sales revenue at Rs 98269.56 Lakhs went up by38%. Exports to USA grew by 48% followed by exports to Europe and Asia which went up by18% and 7% respectively.

All the business segments worked their best to pave the way for anotheryear of high-level growth preceded by huge revenue growth of 39% registered in precedingfinancial year ending 31^st March 2021. Though the home diagnostics businessrecorded astounding growth of 46% API business domestic formulation business and OTC(Over the Counter) business logged remarkable revenue growth of 26% 28% and 23%respectively.

Home diagnostics business with annual sales revenues of Rs 41891.99Lakhs continuous to be anchored by blood glucose and blood pressure monitors with acombined revenue of Rs 36266.33 Lakhs. A revenue growth of 49% was recorded during theyear in respect of combination of said two products. The blood gluco monitor businessconstituting 67% of the overall devices business revenues recording revenue growth of 54%over the last year.

API business with annual revenues of Rs 85846.08 Lakhs and having 56%revenue share in consolidated business of the company is recording new hights withcurrent year revenue growth of 26%. On the strength of huge revenue growth ofanti-allergic drug 'Montelukast' in the domestic markets a revenue growth of 45% wasregistered in domestic API markets. API Export markets grew by 17% on the strength of allround growth across export product basket.

The Formulation business with current year revenues of Rs 16866.90Lakhs recorded huge revenue growth of 28% on the strength of growth recorded in brandedRx business generics business and third-party manufacturing business. In the lastfinancial year annual revenue of Rs 13136.04 Lakhs was registered recording a dip of4.5% against preceding financial year.

OTC business now also participating in online marketing of itsproducts holds tremendous growth potential having current year revenues at Rs 10563.99Lakhs a growth of 23% over last year revenues of Rs 8554.64 Lakhs.

The operations of the company have been profitable across all businesssegments except branded formulations where it is working tirelessly to expand its revenueswhich will make the operations profitable. Apart from capacity expansions the company isupgrading its facilities equipments processes and systems.

On standalone basis annual sales revenues of Rs 144604.93 Lakhs wererecorded during the current financial year against last year revenues of Rs 110172.24Lakhs a growth of 31%.

Financial Performance Sales

The revenues of the company are on the growth trajectory for past manyyears. The current year consolidated sales revenues at Rs 154156.51 Lakhs are up by 31%against previous year sales revenues of Rs 117536.73 Lakhs. Total income for the currentyear is at Rs 155713.41 Lakhs against Rs 120012.53 Lakhs in the preceding year. Theexport revenues at Rs 55886.94 lakhs and domestic revenues at Rs 99826.47 lakhs are upby 17% and 38% respectively.

On standalone basis the company registered sales revenues of Rs144604.93 Lakhs against Rs 110172.24

Lakhs of revenues recorded during previous financial year an annualgrowth of 31%.

Material Cost

The material cost as a percentage of sales at 68.07% is 166 basispoints more than the previous year material cost because of absorption of cost at thecompany's end and increase in low margin domestic API business. Though the company hasstrived to protect its margins however with a view to expand its product penetration italso continues to take requisite business calls to grow its business portfolio.

Employee Cost

The current year's consolidated employee cost is lower at 10.65%against 11.54% of the sales revenue in the last financial year despite growth in teamsize on the strength of substantial increase in current year annual revenues. Themerit-based increase in annual employee compensation has resulted into growth in manpowercost for the year under review.

Other Expenses

The consolidated expenditure on manufacturing sales & marketingand the administrative activities is at 12.75% of sales revenues against 13.05% recordedin the preceding financial year. Increase in sales revenues and control on spend onvarious administrative and sales & marketing activities has helped the company tobring down these expenses.

Finance Cost & Depreciation

Because of settlement with a preference shareholder a sum of Rs 979.16Lakhs provided towards dividend during the past years have been reversed during thecurrent year. It has resulted into negative finance cost of Rs 736.55 lakhs for thecurrent year. Annual consolidated depreciation & amortisation charge has come down toRs 2764.25 Lakhs against Rs 3028.33 Lakhs of previous year.

Other Operating Income & Other Income

The consolidated other operating income represents export incentivesincome from foreign operations & others. The export incentives for the current year atRs 289.15 Lakhs are down by 71% against preceding year incentives at Rs 1007.91 Lakhs.Others comprising of income from foreign operations and other income at Rs 237.03 Lakhsare down by 9% during the current year as against Rs 261.00 Lakhs in the previous year.

The consolidated other income representing currency fluctuationsinterest income and others is lower at Rs 1030.72 Lakhs against previous year of Rs1206.89 Lakhs.

Profit after Tax

The consolidated profit before interest depreciation and tax is higherat Rs 14697.96 Lakhs as against Rs 13058.30 Lakhs in the previous year. Net profit aftertax but before share of profit from non-controlling interest is at Rs 10168.13 Lakhsagainst Rs 9709.00 Lakhs in last financial year. The consolidated net profit net ofminority share at Rs 10168.27 Lakhs is up by 4.73% over previous years' profit of Rs9708.59 Lakhs. Total comprehensive income for the current year is at Rs 10131.17 Lakhsagainst Rs 9693.87 Lakhs in the previous financial year a growth of 4.51%.

On standalone basis the net profit after tax for the year is at Rs10106.29 Lakhs as against Rs 9424.84 Lakhs during previous financial year a growth of7.23%. Total comprehensive income for the year is at Rs 10069.44 Lakhs vis-a-vis Rs9397.58 Lakhs of the preceding year a growth of 7.15%.

Active Pharmaceutical Ingredients (API)

Continuing with the growth journey of past many years and on the backof stupendous growth of over 44% recorded during the preceding year a revenue growth of26% has been recorded for the current year ending 31^st March 2022. On thestrength of 45% growth in domestic revenues current year API revenues have risen to Rs85846.08 Lakhs from Rs 68299.42 Lakhs of revenues recorded in the previous year ending31^st March 2021. On standalone basis API share in total revenue is at 59.37%against 61.99% in last financial year a dip of 262 bps. 183 new customers were addedduring the year despite restricted

movements travel and personal meetings. Export markets comprising ofAmerica Europe Africa South America and Asia have shown continued growth apart fromincredible growth in domestic markets.

The price realisation for company's product offerings in some of themarkets has been steady though there has been margin pressure in domestic markets. Thecompany has leadership position in the two products Loratadine and Montelukast and has 68%and 49% share in export out of India for these two products respectively. Loratadine andMontelukast jointly constituting 67% of total API revenues having recorded a revenuegrowth of 28% during the year registered a combined revenue of Rs 57678.56 Lakhs. Onstandalone basis Montelukast with annual revenues of Rs 30964.14 Lakhs has recorded anannual growth of 65% whereas Loratadine with annual revenues Rs 26714.42 Lakhs grew upby 1% over the last year. Atorvastatin third major revenue generating product hasrecorded a revenue of Rs 12261.55 Lakhs during the year a growth of 18% over precedingyear revenues of Rs 10417.02 Lakhs.

New molecules have generated a revenue of Rs 3338.00 Lakhs during theyear a growth of 53% against last year revenues of Rs 2177.90 Lakhs.

US Food and Drug Administration ('USFDA') approval for company'santi-allergy drug Fexofenadine HCl during the current year has opened the gates forregulatory markets for the product and the shipments has started for the USA market.During the year company has added more than 200 new customers globally and has also filed5 new international patents.

The company has recently signed a strategic partnership with AzelisGermany (www.azelis.com) for exclusive marketing of its API portfolio in selected Europeancountries. Azelis is leading global specialty pharma major present in over 60 countrieswith revenues of Euro 2.80 billion.

Home Diagnostics - Point of Care Device Business

With highest ever annual revenues of Rs 41891.99 Lakhs current yearrevenues are up by 46% against previous year revenues of Rs 28736.77 Lakhs.

Blood Gluco business with annual revenues of Rs 27864.81 Lakhs haverecorded substantial revenue growth of 54% whereas BP monitor revenue at Rs 8401.52 Lakhshas moved up by 33% during the year. The compounded annual growth rate ('CAGR') duringlast 4 years for Blood Glucose Monitor business has been at 44% while for BP monitorbusiness it is at 47%. On the strength of its leadership position in the blood glucose andblood pressure business the company is aggressively increasing its reach to the tier-2and tier-3 cities. The company has slowly started investing in various marketing channelsincluding advertisement in the electronic media for promotion and market expansion ofblood gluco monitors and blood pressure monitors.

With new installation of 2.16 million glucometers during the year thecompany has installed 7.20 million glucometers till date. During the year 300 millionblood gluco strips were sold making total gluco measuring strips supplies exceeding 900million strips till the year end. In the blood pressure business the company had landmarkinstallation of 1.20 million BP monitors during the year which is highest ever in anyyear.

The revenue from other point of care products on the strength ofcombined Oxygen Concentrators and Pulse Oximeters sales revenue of Rs 2418.82 Lakhs hasgone up by 28% at Rs 5625.66 lakhs.

The company continues to invest in the glucometers distribution in themarket to expand its customer base. These investments in turn reward the company inexpanding the customer base for its glucose business.

Finished Formulations

The finished dosages business has made a notable recovery byregistering net sales revenue of Rs 15854.48 Lakhs during the current year againstpreceding year net sales revenue of Rs 11945.90 Lakhs a growth of 33%. During thepreceding year ending 31^st March 2021 a dip of 10.62% was recorded in theannual revenues in the backdrop of restrictions on movements and personal interactionsfor the sales team during corona virus outbreak.

During the year at Rs 4985.55 Lakhs 56% revenue growth in brandedformulation was recorded. Both generics business at Rs 5772.52 Lakhs and contractmanufacturing business (net) at Rs 5096.41 Lakhs recorded a growth of 33% during theyear. Under the branded prescription (Rx) product category the top three therapeuticcategories namely Antibiotics Gastroenteritis and Vitamins contributed Rs 3050.29 Lakhsto branded formulation business against Rs 2010.52 Lakhs contributed to the previousyear.

DIVIDEND

Given the growing resource needs for expanding the business of thecompany the Directors do not recommend dividend for the year under review.

Pursuant to compliance with the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 as amended ("the ListingRegulations") the company has dividend distribution policy. The said policy isavailable on the website of the company and can be accessed on following weblinkhttps://www.morepen.com/public/img/Dividend%20Distri bution%20Policy.pdf

RESERVES

The standalone net profit after tax of Rs 10106.29 Lakhs as reducedby a sum of Rs 500.00 Lakhs being transfer to capital redemption reserve has beencarried forward to the 'Retained Earnings' during the year. No amount has been transferredto the general reserve during the current year. A sum of Rs 6440.00 Lakhs has been addedto securities premium account during the year on account of issuance of 280 Lakhs equityshares of Rs 2/- each at a premium of Rs 23/- per share (i.e. conversion of fullyconvertible warrants).

DEPOSITS

Your company has not accepted any deposits from the public during theyear under review within the meaning of Section 73 of the Companies Act 2013 ('the Act')read with the Companies (Acceptance of Deposits) Rules 2014.

FINANCES

The company has been funding its growth through its internal accrualsfor past many years due to non-availability of any institutional working capitalframework. However during the year a sum of Rs 5250 Lakhs brought in for balance 75%payment of 280 Lakhs warrants issued to the entities belonging to promoter group in thepreceding year was used to fund working capital and others.

The matter of redemption of preference shares issued to banksfinancial institutions and others was awaiting closure for many years on account ofunavailability of distributable profits in terms of Section 55(2) (a) read-with Section123 of the Act and its rules made thereunder. Though the company was able to erase allits accumulated losses during the preceding year however could not redeem its preferenceshare capital of Rs 11965.20 Lakhs. With its limited resources it could only redeempreference capital to the extent of Rs 500.00 Lakhs during the year whereas for thebalance preference capital of Rs 11465.20 Lakhs the company had sought the support ofbanks and financial institutions to accept equity shares in lieu of preference sharesheld by them.

During the year under review in joint online meeting with theOptionally Convertible Preference Share (OCPS) holders and Cumulative RedeemablePreference Share (CRPS) holders of the company it impressed up on the preferenceshareholders to favourably consider and accept the company's proposal for variation ofrights attached to these preference shares in terms of allotment of CompulsorilyConvertible Preference Shares (CCPS) convertible into equity shares of the company inlieu of preference share presently held by them. The company promised to take thenecessary steps at its earliest possible on receipt of approvals from preferenceshareholders holding minimum 75% value of each class of preference capital of the companyas stipulated under the applicable provisions of the Act and rules made thereunder. Thecompany undertook to act swiftly for taking due approvals from Board of Directors andequity shareholders of the company.

After receipt of aforesaid approval of the preference shareholders thecompany sought and obtained equity shareholders' approval for issuance of in aggregate114652010.01% CCPS of Rs 100/- each convertible into 21342505 equity shares of Rs2/- each issued at a premium of Rs 51.72 per share against conversion of 9735201 0.01%OCPS of Rs 100/- each and 0.01% 1730000 CRPS of Rs 100/- each currently held by thebanks financial institutions and other.

On receipt of in principle and listing approvals from the stockexchanges aforesaid 21342505 equity shares issued to banks financial institutionsand other were credited to their respective demat accounts. The trading approvals inrespect of these equity shares have also been granted by both the stock exchanges. Byallotment of equity shares in lieu of preference shares previously held by banksfinancial institutions and other the company has put to rest the matter of redemption ofpreference shares which was lying unresolved since financial year ending 31^stMarch 2015. Now there exists no default in respect of redemption of preference shares heldby any preference shareholder of the company. The last remaining part of company's debtrestructuring exercise i.e. redemption of preference shares which was pending for pastmany years has now been resolved and debt restructuring exercise had attained itsfinality.

SHARE CAPITAL

During the year the equity share capital of the company has risen byRs 560.00 Lakhs to Rs 9555.86 Lakhs against Rs 8995.86 Lakhs as of 31^st March2021. The company in the current year has issued 280 Lakh equity shares of Rs 2/- eachat a premium of Rs 23/- per share to the entities belonging to the promoter group. Duringthe year 280 Lakh fully convertible warrants ('warrants') out of Rs 700.00 Lakhswarrants allotted in the previous financial year were converted in equivalent no. ofequity shares on the receipt of balance 75% consideration in respect thereof amounting toRs 5250.00 Lakhs.

Out of 92490413 equity shares issued to fixed deposit holders of thecompany in August 2009 5038983 equity shares were surrendered with the company for thecancellation in compliance with Hon'ble NCLT order dated 12^th March 2018. Thecompany in compliance with aforesaid NCLT order has repaid the fixed deposit dues alongwith the accumulated interest in respect of these equity shares surrendered forcancellation. The company has filed requisite application with stock exchanges for thecancellation of these equity shares from its total listed capital. The said application isyet to be approved.

The equity shares issued by the company are listed at following stockexchanges as on 31^st March 2022:

1. National Stock Exchange of India Limited (NSE)

2. BSE Limited (BSE)

Annual listing fee for the financial year 2022-23 has been paid to boththe Stock Exchanges. The equity shares continue to be listed on both NSE and BSE.

SUBSIDIARIES / JOINT VENTURES / ASSOCIATES

Pursuant to consent of members for hiving off point of care medicaldevices business of the company the company has incorporated a new wholly ownedsubsidiary namely Morepen Devices Limited to carry out the point of care medical devicesbusiness independently post receipt of requisite approvals including approvals from drugregulators.

On 31^st March 2022 the company has four (4) subsidiariesnamely:

1. Dr. Morepen Limited

2. Morepen Devices Limited

3. Total Care Limited (subsidiary of Dr. Morepen Ltd.)

4. Morepen Inc. USA

Dr. Morepen Limited

With current year revenues of Rs 10563.99 Lakhs the over the counter(OTC) business promoted under brand 'Dr. Morepen' has recorded revenue expansion of over23% against preceding year revenues of Rs 8554.64 Lakhs. The current year growth hasbeen even massive despite huge 88% fall in current year revenues from covid range ofproducts at Rs 249.57 Lakhs. The compounded annual growth rate (CAGR) during last fouryears has risen to 24.77% during the year against 20.50% in the last year. OTC range ofproducts with annual revenues of Rs 5243.41 Lakhs have recorded 13% growth on y-o-ybasis. The current year revenues from grooming business went up by 60% at Rs 2773.21Lakhs. The brand sharing revenues have gone up to Rs 2547.34 Lakhs a growth of 16% overprevious year revenues.

Online revenues at Rs 1652.65 Lakhs has gone up by 273% during theyear. During the current year the share of online business has reached 16% from 5% inthe last year.

The new product additions have been made in the health basket in thenutrition Personal Care Oral Care segment during the current year i.e. Dr. Morepen SlimShake ( Fat Loss) Apple Cider Vinegar (Fat Loss) Ashwagandha capsules (StressManagement) Cod Liver (Joints & Heart Health) Fat Burner Tablet (Fat Loss) GarciniaCambogia ( Fat Loss) Gokshura (Intimate Wellness) Omega fish oil (Joints & HeartHealth) PCOS powder (Pcod Supplements) Sleep tablets (For Sleep Disorder) TestosteroneBooster (Testosterone increasing) Biotin + (Hair & Skin) Iron & Zinc(Multivitamin) Memory focus & Mood (Memory Booster Supplement) Multivitamin for men& women Bamboo tooth brush (Oral care) Milk Thistle (Liver Supplement) Rose water(Personal Care) Y-Druff Shampoo (Personal Care) Veg Omega (Heart Health) NaturalCollagen builder (Skin Nutrition) Greatgut (immunity capsules) Weight gainer (WeightGain) CLA 1000 Capsules (Fat Loss) and Aloe vera Gel (Personal Care). All these productsfalling under the category of nutrition Personal Care Oral Care has contributed Rs805.28 Lakhs of revenues during the year out of total category revenues of Rs 1156.85Lakhs. The corresponding revenues for the preceding year was Nil and Rs 80.37 Lakhsrespectively.

The current year combined sales revenues for primary brands comprisingof Burnol (Burn Cream) Lemolate (Cough & Cold) and Fiber-X (Sat Isabgol) is at Rs1901.77 Lakhs against revenues of Rs 1908.15 Lakhs posted in last year.

The company is promoting its products through online channels cateringto younger generation for the general health wellness and personal grooming. Havingrecorded significant progress during the year the company will invest more for expansionof online channel and make long term connect with younger population.

Morepen Devices Limited

No operating activities have been carried out during the year.

Total Care Limited

The company is dealing in OTC & Health Care products. The revenueduring the year has been meagre at Rs 0.27 Lakhs.

Morepen Inc.

Morepen Inc. is the marketing and distribution interface of the companyin USA for its API business various OTC & other products. During the current yearthe company has recorded revenue of Rs 204.46 Lakhs ($270205) as against Rs 181.89 Lakhs($247371) of previous year a growth of 12%. The company has recorded 34% growth inpost-tax profit at Rs 65.09 Lakhs against profit of Rs 48.72 Lakhs logged in the previousyear.

CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements for the year ended 31^stMarch 2022 have been prepared in accordance with Indian Accounting Standards (Ind AS)notified under the Companies (Indian Accounting Standards) Rules 2015 as amended togetherwith the comparative period data as at and for the previous year ended 31^stMarch 2021.

In accordance with the Act and Indian Accounting Standards (Ind AS) 110on 'Consolidated Financial Statements' read with Ind AS 112 on 'Disclosure of interests inother entities' the Audited Consolidated Financial Statements is provided in the AnnualReport.

In accordance with the provisions of Section 129(3) of the Act readwith the Companies (Accounts) Rules 2014 a report on the performance and financialposition of each of the subsidiaries is attached as ANNEXURE 'A' to this report inthe prescribed form (AOC-1).

DIRECTORS & KEY MANAGERIAL PERSONNEL Changes in Directors & KeyManagerial Personnel

The members in their 36 ^th Annual General Meeting ('AGM')held on 28 ^th September 2021 approved the appointment of Mr. Sanjay Suri (DIN:00041590) who retired by rotation at said AGM and being eligible offered himself forre-appointment.

The term of Dr. Arun Kumar Sinha (DIN: 00450783) as Whole-Time Directorhad completed on 31^st March 2022. (closing business hours) The office ofdirectorship of Dr. Sinha stands vacated on said date.

Mrs. Anju Suri (DIN: 00042033) a Non-Executive Non-IndependentDirector of the company has resigned on 22^nd June 2022 (closing businesshours) from the directorship of the company.

The existing term of Mr. Sanjay Suri (DIN: 00041590) as Whole-TimeDirector of the company will be completed on 12^th August 2022. In view ofaforesaid based on the recommendation of Nomination and Remuneration Committee subjectto approval of members of the company at ensuing AGM the Board of Directors hasrecommended appointment of Mr. Sanjay Suri as WholeTime Director for further period of 3years. The Board of Directors is seeking consent of members for re-appointment of Mr.Sanjay Suri at 37^th AGM.

Mr. Sanjay Suri (DIN: 00041590) is liable to retire by rotation andbeing eligible offered himself for reappointment at ensuing AGM. The Board of Directorsof the company based on the recommendation of Nomination and Remuneration Committee andsubject to approval of members of the company at ensuing AGM recommended re-appointmentof Mr. Sanjay Suri at ensuing AGM. The Board of Directors is seeking consent of membersfor re-appointment of Mr. Sanjay Suri at 37 ^th AGM.

Declaration by Independent Director(s)

Pursuant to the provisions of Section 149 of the Act the IndependentDirectors have submitted declarations that each of them meets the criteria of independenceas provided in Section 149(6) of the Act along with Rules framed thereunder and Regulation16(1)(b) of the Listing Regulations. There has been no change in the circumstancesaffecting their status as Independent Directors of the company.

Evaluation of Board Committees and Directors

Pursuant to the provisions of the Act and Regulation 17 of the ListingRegulations the board has carried out its own performance evaluation that of thecommittees and the individual performance of its Directors. The way the evaluation hasbeen carried out has been provided in the 'corporate governance report'.

Familiarization Programme for Independent Directors

The details pertaining to familiarization programme for IndependentDirectors has been incorporated in 'Corporate Governance Report'.

Meetings of Board of Directors

The Board of Directors met seven (7) times during the year underreview to transact the business of the company the details of which are given in'corporate governance report'.

Independent Directors Meeting

During the year under review a separate meeting of the IndependentDirectors of the company was held on 8* February 2022 without the presence ofNon-Independent Directors and members of the management except Company Secretary. TheIndependent Directors reviewed the performance of Non-Independent Directors and the Boardas a whole performance of chairperson of the company and assessed the quality quantityand time lines of flow of information between the company management and the Board. Allthe Independent Directors of the company were present in the meeting.

DIRECTORS' RESPONSIBILITY STATEMENT

As required under Section 134(3)(c) of the Act your Directors to thebest of their knowledge and belief and according to the information and explanationsobtained by them confirm that :

a) in the preparation of annual accounts the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures wherever applicable within statutory prescribed timeline.

b) your Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for that period;

c) your Directors have taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding the assets of the company and for prevention and detecting of fraud andother irregularities;

d) the annual accounts have been prepared on a going concern basis;

e) internal financial controls to be followed by the company have beenlaid down and such internal financial controls are adequate and were operatingeffectively;

f) proper systems to ensure compliance with the provisions of allapplicable laws have been devised and that such systems were adequate and operatingeffectively.

MANAGERIAL REMUNERATION AND OTHER

DISCLOSURES

Disclosure pursuant to Section 197 of the Act read with Rule

5 of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules 2014:

a) Ratio of the remuneration of each Director to the medianremuneration of the employee's (MRE) and other details pursuant to Section 197 (12) of theAct read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 is annexed and forms part of this report as ANNEXURE 'B'.

b) The statement containing the particulars of employees as requiredunder section 197(12) of the Act read with Rule 5(2) and other applicable Rules (if any)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 isprovided in a separate annexure forming part of this report. Further the report and theaccounts are being sent to the members excluding the aforesaid annexure. In terms ofSection 136 of the Act the said annexure is open for inspection at the registered andcorporate office of the company during the working hours. Any member interested inobtaining a copy of the same may write to the company and obtain the copy within statutoryprescribed timeline.

c) No Director of the company including its Managing Director orWhole-Time Director is in receipt of any commission from the company or its subsidiarycompany.

AUDIT COMMITTEE

Your company has an Audit Committee in compliance of the provisions ofSection 177 of the Act and Regulation 18 of the Listing Regulations. The complete detailswith respect to Audit Committee as required to be given under the relevant provision ofthe Act is given in the 'corporate governance report'.

WHISTLE BLOWER POLICY / VIGIL MECHANISM

The company has established a whistle blower policy/vigil mechanismthrough which its Directors employees and stakeholders can report their genuine concernabout unethical behaviours actual or suspected fraud or violation of the company's codeof conduct or ethics policy. The said policy provides for adequate safeguard againstvictimization and direct access to the higher level of superiors including chairman of theAudit Committee in exceptional cases. The same is reviewed by the Audit Committee fromtime to time.

RISK MANAGEMENT

The company has in place a mechanism to inform the Board about the riskassessment and minimization procedures and periodical review to ensure that managementcontrols the risk through means of a properly defined framework.

The company has formulated and adopted risk management policy toprescribe risk assessment management reporting and disclosure requirements of thecompany.

The company being one of the top 1000 listed entities have a dulyconstituted a Risk Management Committee of the Board of Directors for monitoring andreviewing of the risk and its management thereof.

NOMINATION AND REMUNERATION COMMITTEE

Your company has a Nomination and Remuneration Committee in compliancewith the provisions of Section 178 the Act and Regulation 18 of the Listing Regulations.The complete details with respect to the salient features of Nomination and RemunerationCommittee as required to be given under the aforesaid provisions is given in the'corporate governance report'.

The company has adopted a nomination and remuneration policy for theDirectors Key Managerial Personnel and other employees of the company as formulated byNomination and Remuneration Committee pursuant to provisions of Section 178 of the Actand Para A of Part D of Schedule II of the Listing Regulations which acts as a guidelinefor determining inter-alia qualifications positive attributes and independence of adirector matters relating to the remuneration appointment removal and evaluation ofperformance of the Directors Key Managerial Personnel senior management and otheremployees.

The detailed policy formulated by Nomination and Remuneration Committeecan be accessed at http://www.morepen. com/pdf/Nomination-and- Remuneration-Policy.pdf

STATUTORY AUDITORS

M/s. Satinder Goyal & Co. Chartered Accountants (FRN: 027334N)statutory auditors of the company were appointed by the shareholders at the 32^ndAGM held on 22^nd September 2017 pursuant to provisions of Section 139 141142 and other applicable provisions if any of the Act read with the Companies (Auditand Auditors) Rules 2014 (including any statutory modification(s) or re-enactmentthereof for the time being in force) and subject to all the applicable laws andregulations for a term of five (5) consecutive years to hold office from the conclusion ofthe 32^nd AGM until the conclusion of the ensuing AGM i.e. 37 ^thAGM.

Pursuant to Section 139 of the Act and other applicable provisions ofthe Act based on the recommendation of the Audit Committee the Board of Directors of thecompany has appointed M/s. S. P Babuta Chartered Accountants (FRN: 007657N) asstatutory auditors for a term of five (5) consecutive years i.e. to hold office from theconclusion of the ensuing AGM till the conclusion of 42^nd AGM of the company tobe held in the year 2027 subject to approval of the members at the ensuing AGM.

The company is in receipt of consent from M/s. S. P Babuta CharteredAccountants for appointment as the statutory auditors of the company along-with aneligibility certificate that their appointment if made will be in accordance with thelimits specified under the Act and the firm satisfies the criteria specified in Section141 of the Act read with Rule 4 of the Companies (Audit and Auditors) Rules 2014.

The Board is seeking consent of the members for appointment of M/s. S.P Babuta Chartered Accountants as statutory auditors of the company for a term of five(5) consecutive years.

EXPLANATION TO AUDITORS REPORT

The notes on financial statement referred to in the auditors' reportare self-explanatory and do not call for any further comments. The statutory auditor'sreport does not contain any qualifications reservations adverse remarks or disclaimerswhich would be required to be dealt with in the Boards' Report.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Act read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 Mr. PraveenDua proprietor of M/s. PD and Associates a firm of company secretaries was appointed byBoard of Directors of the company as secretarial auditor of the company for the financialyear 2021-22. The secretarial audit report is annexed and forms part of this report asANNEXURE 'C'. Pursuant to compliance of the Listing Regulations every listed entityhaving material unlisted subsidiaries in India shall undertake secretarial audit and shallannex secretarial audit report given by a company secretary in practice with the annualreport of the listed entity. The said requirement of secretarial audit report shallcontinue to remain applicable till such time the specified threshold for being a materialunlisted subsidiary is not applicable for a period of three consecutive financial years.

Dr. Morepen Ltd. being a material unlisted subsidiary company duringthe previous financial year does not fall under the criteria of material unlistedsubsidiary for the financial year under review. The secretarial audit of Dr. MorepenLimited for the financial year 2021-2022 has been undertaken by Mr. Ajay Kumarproprietor of M/s. Ajay. K. & Associates a firm of company secretaries. Thesecretarial audit report of Dr. Morepen Limited is annexed and forms part of this reportas ANNEXURE 'C-1'.

EXPLANATION TO SECRETARIAL AUDIT REPORT

The notes referred to in the secretarial auditor's report of thecompany are self-explanatory and do not call for any further comments. The secretarialauditor' report does not contain any qualification reservation adverse remark ordisclaimer.

The observations made in point no. (f) i.e. cancellation of equityshares surrendered by FD holders the company has filed application with the StockExchanges to take effect of such cancellation of equity shares from total listed capitalof the company and awaiting their response although said shares were cancelled by theBoard of Directors. Further in point no. (g) i.e. appointment of Central GovernmentNominee Directors the requisite explanations are already given in point (i) of 'Legal andCorporate Matters' in this report.

The notes referred to in the secretarial auditor's report of Dr.Morepen Ltd. are self-explanatory and do not call for any further comments. Thesecretarial auditor' report does not contain any qualification reservation adverseremark or disclaimer.

BUSINESS RESPONSIBILITY REPORT

Business Responsibility Report in compliance with Regulation 34(2)(f)of the Listing Regulations the Business Responsibility Report forms part of this annualreport is enclosed as ANNEXURE 'D'

SECRETARIAL STANDARDS

The company has devised proper systems to ensure compliance with theprovisions of all applicable secretarial standards issued by the Institute of CompanySecretaries of India and that such systems are adequate and operating effectively.

COST AUDIT

Pursuant to Section 148 of the Act read with the Companies (CostRecords and Audit) Rules 2014 the Cost Accounting Records maintained by the company arerequired to be audited by cost auditors. The Board of Directors of the company on therecommendation of the Audit Committee has appointed M/s. Vijender Sharma & Co. CostAccountants as the Cost Auditor of the company for the financial year ended 31^stMarch 2023 at a remuneration of Rs 2.00 Lakh subject to the ratification of theirremuneration by the members in the ensuing AGM.

INTERNAL FINANCIAL CONTROLS

The company has an internal control system commensurate with the sizescale and complexity of its operations. The internal financial controls are adequate andare operating effectively to ensure orderly and efficient conduct of business operations.The company's internal financial control procedures ensure that company's financialstatements are reliable and prepared in accordance with the applicable laws.

To maintain its objectivity and independence the internal auditorreports to the Chairman of the Audit Committee. Based on the internal audit reportprocess owners undertake corrective action in their respective areas and therebystrengthening the controls. Significant audit observations and corrective actions thereonare presented to the Audit Committee. The internal auditor carries out extensive auditsthroughout the year across all functional areas and submits its reports from time to timeto the Audit Committee.

CORPORATE SOCIAL RESPONSIBILITY

The Corporate Social Responsibility ('CSR') Committee of the companywas constituted by the Board to monitor implementation of CSR activities by the company inaccordance with Section 135 read with Schedule VII of the Act read with (Corporate SocialResponsibility Policy) Rules 2014 as amended. The composition of the CSR Committee CSRpolicy projects and annual action plan have been placed on the website of the company.Based on the recommendation of the CSR Committee your Board has adopted a CSR policyindicating the activities to be undertaken by the company as specified in Schedule VII ofthe Act.

The report on CSR activities with details of the composition of CSRCommittee CSR Policy CSR initiatives and activities during the year is annexed and formspart of this report as ANNEXURE 'E'.

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

The company has in place a policy on prevention prohibition andredressal of sexual harassment of women at workplace pursuant to the requirements of theSexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.An Internal Complaints Committee ('ICC') has been set up to redress complaints receivedregarding sexual harassment. The policy has set guidelines on the redressal and enquiryprocess that is to be followed by complainants and the ICC while dealing with issuesrelated to sexual harassment at the workplace. All women employees whether permanenttemporary contractual and trainees are covered under this policy. The company has notreceived any complaint during the year.

LEGAL & CORPORATE MATTERS

(I) Due to sudden liquidity problem occasioned by price crash of over89% of its blockbuster drug 'Loratadine' price crash by over 89% the company faceddefaults in servicing its debt obligations to its lending banks and financial institutionsaccompanied by default in timely refund of fixed deposit ('FD') dues to FD holders of thecompany.

The Hon'ble Company Law Board ('CLB') took suo motto notice of thematter of default in FD repayments exercising its powers u/s 58 A (9) of the CompaniesAct 1956 and passed an order dated 19^th August 2003 ordering repayment offixed deposit dues within a period of 4 years.

In the backdrop of continuing liquidity crisis the company could notconform the aforesaid payment schedule stipulated by the Hon'ble CLB.

The Union of India preferred a petition dated 7 ^th January2005 u/s 408 of Companies Act 1956 before the Hon'ble CLB for appointment of sixDirectors for a period of three years on the Board of the company to safeguard theinterest of the company its shareholders its investors and the creditors of thecompany as it did not adhere to the CLB order dated 19^th August 2003.

The Hon'ble CLB with a view to monitor and assist the company in itsmatters then pending before High Court Corporate Debt Restructuring (CDR) forum and DebtRecovery Tribunals vide its order and judgment dated 1^st July 2005 directedthe appointment of two Directors on the Board of the company for a period of three years.Aggrieved by the aforesaid order of CLB the company filed an appeal before the High Courtof Himachal Pradesh at Shimla with a prayer to set aside the CLB order dated 1^stJuly 2005. The Central Government also filed an appeal before the High Court of HimachalPradesh at Shimla against the aforesaid order of CLB.

The Hon'ble High Court after hearing both the appeals vide itsjudgment dated 17^th May 2007 upheld the decision of the CLB appointing twogovernment Directors on the board of the company and disposed of both the appeals.

In two cross appeals filed by the company and the Central Governmentbefore Hon'ble Supreme Court of India against the impugned judgement dated 17 ^thMay 2007of the Hon'ble High Court of Himachal Pradesh confirming appointment of twoGovernment Nominees on the Board of the company for 3 years under provisions of erstwhileCompanies Act 1956 the Hon'ble Supreme Court vide its order dated 16^th July2007 ordered 'status quo' in the matter.

The company vide its application dated 17 ^th July 2018sought to bring before Hon'ble Supreme Court of India the factum of substantialimprovement in the financial position of the company including issuance of equity sharesto its fixed deposit holders and payment of outstanding dues to lending banks financialinstitutions and also placed on record the improvements in the financial position of thecompany subsequent to the order dated 1^st July 2005 passed by Hon'ble CLB. TheHon'ble Supreme Court vide its order dated 9 ^th July 2019 held that nointerference in the decision of Hon'ble High Court is called for and further added that itwould be open for the company to agitate the subsequent events before the concerned forum.

In terms of the liberty granted by the Hon'ble Supreme Court to agitatethe subsequent events before the concerned forum the company filed an application on 18^thSeptember 2019 before Hon'ble National Company Law Tribunal ('NCLT') Chandigarh andsubmitted that the company has been effectively managed by the existing Board ofDirectors who without support of any Nominee Government Directors have ensured that thecompany is debt free today. The various data placed before NCLT testifies the efficacywith which existing Board of Directors worked to turn around the company's financialstransferring it into as profitable venture accomplishing enormous growth over last 14years i.e. since 1^st July 2005 when Hon'ble CLB order for appointment of twoGovernment Directors on Board of the company was passed.

In view of substantial improvements made by company in its financialposition after pronouncement of order dated 1^st July 2005 by Hon'ble CLBappointing two Government Nominees on the Board of the company and various milestonesachieved by it the company sought modification of aforesaid CLB order to the extent thatappointment of two Government Directors (Nominees) on the Board of the company is notnecessary and therefore not required.

In the meanwhile in December 2019 the Central Government filed acontempt petition u/s 425 of the Act read with the Contempt of Courts Act 1971 againstthe company and its then four Directors before Hon'ble NCLT Chandigarh for non-complianceand wilful disobedience of order dated 1^st July 2005 passed by Hon'ble CLB.

The company also brought to the notice of Hon'ble NCLT Chandigarh thecompliance made by company of its order dated 12^th March 2018 in the matter ofrepayment of fixed deposit dues to fixed depositors of the company. The Hon'ble NCLTChandigarh vide its order dated 12^th March 2018 ordered the company to repaythe fixed deposit dues to all the eligible fixed deposit holders who have not dealt withthe shares allotted to them in August 2009 under scheme of compromise and arrangement u/s391-394 of Companies Act 1956 and cancel the equity shares allotted to these FD holders.All the eligible 4953 no. of fixed deposit holders having 5038983 equity shares whosubmitted their shares with the company for the cancellation and provided their bank andidentification particulars for payment of their FD dues were repaid their entireprincipal FD dues along with the accumulated interest thereon amounting to Rs 1884.29Lakhs.

However the Hon'ble NCLT vide its order dated 6* October 2021 setaside the aforesaid application of the company on the ground that order dated 1^stJuly 2005 of Hon'ble CLB has been upheld by the Hon'ble Supreme Court of India and henceit cannot modify or cancel the same. It further added that the observation of the Hon'bleSupreme Court of India that "It would be open for appellant to agitate the subsequentevents before the concerned forum" cannot empower it to modify the order which wasupheld by the Hon'ble Supreme Court of India. It further ordered for issuance of noticesto the company and its four Directors in response to contempt petition filed by CentralGovernment on the grounds that the Apex court has neither modified the order of NCLT/CLBnor has issued any directions.

In the month of November 2021 the company filed an appeal beforeHon'ble National Company Law Appellate Tribunal (NCLAT) against Hon'ble NCLT order dated 6^thOctober 2021 setting aside the company application dated 18 ^th September 2019it sought modification of CLB order dated 1^st July 2005 to the extent thatappointment of two Government Directors (Nominees) on the Board of the company is notnecessary and not required as the company has achieved enormous financial strength duringlast 14 years under the guidance of its existing Board of Directors who have diverseexperience in the field of finance corporate governance technology and management.

The Hon'ble NCLAT has ordered status quo in the company appeal filedagainst NCLT order dated 6 ^th October 2021. As the aforesaid company appeal ispending for disposal before Hon'ble NCLAT the contempt petition filed by CentralGovernment against the company and its Directors before Hon'ble NCLT Chandigarh ispending for adjudication.

(ii) In the matter of prosecutions launched by the Registrar ofCompanies/Central Government against the company and its Director's u/s 235 of theerstwhile Companies Act 1956 the company is defending against the said prosecutionsbefore the court and the matter is under adjudication.

(iii) Six cases filed by Registrar of Companies under variousprovisions of section 58A 58 (3A) 58 (AA) (1) 629 A of erstwhile Companies Act 1956and rules made thereunder against the company and its Directors have been compoundedduring the year.

ANNUAL RETURN

The annual return is available at the website of the company at

https://morepen.com/public/uploads/investor/Morepen62f2582a1a66d.pdf MATERIALCHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

Post closure of financial year 2021-22 the company has allotted21342505 equity shares of Rs 2/-each at a premium of Rs 51.72/- per equity share inlieu of 11465201 0.01% Compulsorily Convertible Preference Shares ('CCPS') of Rs 100/-each which were issued & allotted towards conversion of 9735201 0.01% OptionallyConvertible Preference Shares ('OCPS') of Rs 100/- each amounting to Rs 9735.20 Lakhs and1730000 0.01% Cumulative Redeemable Preference Shares ('CRPS') of Rs 100/- eachamounting to Rs 1730 Lakhs. It has resulted into reduction of current financialliabilities by Rs 11465.20 Lakhs with corresponding increase in equity capital of thecompany consisting of increase of equity share capital of the company by Rs 426.85 Lakhsand share premium account by Rs 11038.35 Lakhs.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGEEARNINGS ANT OUTGO

The information relating to conservation of energy technologyabsorption and foreign exchange earnings and outgo as required under Section 134(3)(m) ofthe Act read with the Companies (Accounts) Rules 2014 is annexed and forms part of thisreport as ANNEXURE 'F'.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

Details of loans guarantees and investments covered under theprovisions of Section 186 of the Act are given in the notes to the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All the related party transactions that were entered into during thefinancial year were on arm's length basis and in the ordinary course of business. Duringthe year under review there were no material significant related party transactionincluding arm's length transactions; hence disclosure in Form AOC - 2 is not required.

The complete details with respect to contracts or arrangements withrelated parties as required to be given under the Act and Part C of Schedule V of theListing Regulations is given in the 'Corporate Governance Report'.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

A detailed review of the operations and performance of the company isset out in the management discussion and analysis report pursuant to Part B of Schedule Vof the Listing Regulations which forms part of the Annual Report for the year under reviewas ANNEXURE 'G'.

HUMAN RESOURCES

A detailed review of human resources of the company is set out in themanagement discussion and analysis report.

CORPORATE GOVERNANCE

A report on corporate governance along with a certificate from thepracticing company secretary regarding compliance with conditions of the corporategovernance as stipulated in Part E of Schedule V of the Listing Regulations forms part ofthis report and is annexed as ANNEXURE 'H'.

ACKNOWLEDGEMENTS

The Directors express grief for loss of life due to Covid -19 pandemicand express deep respect for every person who risked his life and safety to fight thepandemic. The Directors place on record their appreciation to all the company's employeesfor their contribution towards the company's performance. The Directors would also like tothank the shareholders customers dealers suppliers bankers governments and all otherbusiness associates for their co-operation and continuous support to the company and theirconfidence in its management.