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Suven Life Sciences Ltd.

BSE: 530239 Sector: Health care
NSE: SUVEN ISIN Code: INE495B01038
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OPEN 89.50
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VOLUME 24145
52-Week high 124.40
52-Week low 48.25
P/E
Mkt Cap.(Rs cr) 1,153
Buy Price 0.00
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Sell Price 0.00
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OPEN 89.50
CLOSE 91.00
VOLUME 24145
52-Week high 124.40
52-Week low 48.25
P/E
Mkt Cap.(Rs cr) 1,153
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Suven Life Sciences Ltd. (SUVEN) - Auditors Report

Company auditors report

To the Members of Suven Life Sciences Limited

Report on the Standalone Ind AS Financial Statements

Opinion

We have audited the accompanying standalone Ind AS financial statements of SuvenLife Sciences Limited ('the Company') which comprise the Balance Sheet as at 31stMarch 2021 the Statement of Profit and Loss (including Other Comprehensive Income) theStatement of Changes in Equity and the Statement of Cash Flows for the year ended on thatdate and notes to the standalone Ind AS financial statements including a summary ofsignificant accounting policies and other explanatory information (herein after referredto as "Ind AS financial statements").

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 Companies Act 2013 ("the Act") in the manner so required andgive a true and fair view in conformity with the Indian Accounting Standards prescribedunder section 133 of the Act read with the Companies (Indian Accounting Standards) Rules2015 as amended ("Ind AS") and other accounting principles generally acceptedin India of the state of affairs of the Company as at 31st March 2021 its lossincluding other comprehensive loss changes in equity and its cash flows for the yearended on that date.

Basis for Opinion

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing (SAs) specified under section 143(10) of the Companies Act2013. Our responsibilities under those Standards are further described in the Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements section ofour report. We are independent of the Company in accordance with the Code of Ethics issuedby the Institute of Chartered Accountants of India (ICAI) together with the ethicalrequirements that are relevant to our audit of the standalone Ind AS financial statementsunder the provisions of the Companies Act 2013 and the Rules made thereunder and we havefulfilled our other ethical responsibilities in accordance with these requirements and theICAI's Code of Ethics. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the standalone Ind ASfinancial statements.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements of the currentperiod. These matters were addressed in the context of our audit of the standalone Ind ASfinancial statements as a whole and in forming our opinion thereon and we do not providea separate opinion on these matters. We have determined the matters described below to bethe key audit matters to be communicated in our report.

S. No Key Audit Matters Auditor's Response
1 Investment in Subsidiary: Our audit procedures in respect of impairment of investment in subsidiary included the following:
The carrying value of investment in the subsidiary as at 31st March 2021 is Rs.29502.55 Lakhs. - Testing design implementation and operating effectiveness of key controls over the impairment review process including the review and approval of forecasts and review of valuation models;
This investment is reviewed at the end of each reporting period to determine whether there is any indication of impairment. If such evidence exists impairment loss is determined and recognised in accordance with Note 2(p) of accounting policies to the standalone Ind AS financial statements. - Assessing the valuation methodology used by management and management review control is around making the assessment and testing the mathematical accuracy of the impairment models;
We have identified the assessment of impairment indicators and resultant provision if any in respect of investment in subsidiary as a key audit matter because of: - Evaluating the reasonableness of the valuation assumptions such as discount rates used by management through reference to external market data;
• The significance of the amount of this investment in the Standalone Balance Sheet. - Challenging the appropriateness of the business assumptions used by management such as sales growth cost and the probability of success of new products;
• Performance and net worth of these entities and - Evaluating past performances where relevant and assessed historical accuracy of the forecast produced by management;
• The degree of management judgement involved in determining the recoverable amount of these investments including: - Enquiring and challenging management on the commercial strategy associated with the products to ensure that it was consistent with the assumptions used in estimating future cash flows;
- Valuation assumptions such as discount rates. - Considering whether events or transactions that occurred after the balance sheet date but before the reporting date affect the conclusions reached and the associated disclosures; and
- Business assumptions used by management such as sales growth and costs and the resultant cash flows projected to be generated from these investments. - Performing sensitivity analysis of key assumptions including future revenue growth rates costs and the discount rates applied in the valuation models.
2. Identification and disclosures of Related Parties:
(as described in Note-29 of the following: standalone Ind AS financial statements) - Our audit procedures amongst others included the
Evaluated the design and tested the operating effectiveness of controls over identification and disclosure of related party transactions.
- The Company has related party transactions which include amongst others sale and purchase of goods/services to its subsidiaries associates joint ventures and other related parties and lending and borrowing to its subsidiaries associates and joint ventures and other related parties. Obtained a list of related parties from the Company's Management and traced the related parties to declarations given by directors where applicable and to Note 29 of the standalone Ind AS financial statements.
- We focused on identification and disclosure of related parties in accordance with relevant accounting standards as a key audit matter. Read minutes of the meetings of the Board of Directors and Audit Committee Tested material creditors/debtors loan outstanding/ loans taken to evaluate existence of any related party relationships; tested transactions based on declarations of related party transactions given to the Board of Directors and Audit Committee.
Evaluated the disclosures in the standalone Ind AS financial statements for compliance with Ind AS 24.

Information Other than the Standalone Ind AS Financial Statements and Auditor's ReportThereon

The Company's Board of Directors is responsible for the preparation of the otherinformation. The other information comprises the information included in the ManagementDiscussion and Analysis Board's Report including Annexures to Board's Report BusinessResponsibility Report Corporate Governance and Shareholder's Information but does notinclude the standalone Ind AS financial statements and our auditor's report thereon.

Our opinion on the standalone Ind AS financial statements does not cover the otherinformation and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS financial statements ourresponsibility is to read the other information and in doing so consider whether theother information is materially inconsistent with the standalone Ind AS financialstatements or our knowledge obtained during the course of our audit or otherwise appearsto be materially misstated.

If based on the work we have performed we conclude that there is a materialmisstatement of this other information; we are required to report that fact. We havenothing to report in this regard.

Management's Responsibility for the Standalone Ind AS Financial Statements

The Company's Board of Directors is responsible for the matters stated in section134(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 changes inequity and cash flows of the Company in accordance with the Ind AS and other accountingprinciples generally accepted in India.

This responsibility also includes maintenance of adequate accounting records inaccordance 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.

In preparing the standalone Ind AS financial statements management is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

Those Board of Directors are responsible for overseeing the Company's financialreporting process.

Auditor's Responsibility for the Audit of the Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about whether these standalone Ind ASfinancial statements as a whole are free from material misstatement whether due to fraudor error and to issue an auditor's report that includes our opinion. Reasonable assuranceis a high level of assurance but is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when it exists. Misstatements canarise from fraud or error and are considered material if individually or in theaggregate they could reasonably be expected to influence the economic decisions of userstaken on the basis of these standalone Ind AS financial statements.

As part of an audit in accordance with SAs we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone Ind ASfinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• Obtain an understanding of internal financial controls relevant to the audit inorder to design audit procedures that are appropriate in the circumstances. Under section143(3)(i) of the Act we are also responsible for expressing our opinion on whether theCompany has adequate internal financial controls system in place and the operatingeffectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonablenessof accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basisof accounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe standalone Ind AS financial statements or if such disclosures are inadequate tomodify our opinion. Our conclusions are based on the audit evidence obtained up to thedate of our auditor's report. However future events or conditions may cause the Companyto cease to continue as a going concern.

• Evaluate the overall presentation structure and content of the standalone IndAS financial statements including the disclosures and whether the standalone Ind ASfinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

Materiality is the magnitude of misstatements in the standalone Ind AS financialstatements that individually or in aggregate makes it probable that the economicdecisions of a reasonably knowledgeable user of the standalone Ind AS financial statementsmay be influenced. We consider quantitative materiality and qualitative factors in (i)planning the scope of our audit work and in evaluating the results of our work; and (ii)to evaluate the effect of any identified misstatements in the standalone Ind AS financialstatements.

We communicate with those charged with governance regarding among other matters theplanned scope and timing of the audit and significant audit findings including anysignificant deficiencies in internal control that we identify during our audit. We alsoprovide those charged with governance with a statement that we have complied with relevantethical requirements regarding independence and to communicate with them allrelationships and other matters that may reasonably be thought to bear on ourindependence and where applicable related safeguards.

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the standalone Ind AS financialstatements of the current period and are therefore the key audit matters. We describethese matters in our auditor's report unless law or regulation precludes public disclosureabout the matter or when in extremely rare circumstances we determine that a mattershould not be communicated in our report because the adverse consequences of doing sowould reasonably be expected to outweigh the public interest benefits of suchcommunication.

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 terms of sub-section (11) of section 143 ofthe Act we give in the "Annexure-A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

As required by section 143 (3) of the Act based on our audit 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 our opinion proper books of account as required by law have been kept by theCompany so far as it appears from our examination of those books.

c) The Balance Sheet the Statement of Profit and Loss including Other ComprehensiveIncome Statement of Changes in Equity and the Statement of Cash Flows dealt with by thisReport are in agreement with the books of account.

d) In our opinion the aforesaid standalone financial statements comply with the IndianAccounting Standards specified under Section 133 of the Act read with Rule 7 of theCompanies (Accounts) Rules 2014.

e) On the basis of the written representations received from the directors as on 31stMarch 2021 taken on record by the Board of Directors none of the directors isdisqualified as on 31st March 2021 from being appointed as a director in terms ofSection 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls over financialreporting of the Company and the operating effectiveness of such controls refer to ourseparate report in "Annexure-B" Our report expresses an unmodifiedopinion on the adequacy and operating effectiveness of the Company's internal financialcontrols over financial reporting.

g) With respect to the other matters to be included in the Auditor's Report inaccordance with the requirements of section 197(16) of the Act as amended:

In our opinion and to the best of our information and according to the explanationsgiven to us the remuneration paid by the Company to its directors during the year is inaccordance with the provisions of section 197 and Schedule V of the Act.

h) 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 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements- Refer Note 30 to the financialstatements

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses.

iii. There has been no delay in transferring amounts required to be transferred tothe Investor Education and Protection Fund by the Company.

For TUKARAM & CO LLP
Chartered Accountants
ICAI Firm Regn. No.004436S
Rajender Reddy K
Partner
Place: Hyderabad Membership No.231834
Date: 4th May 2021 UDIN:21231834AAAABE9333

- A to the Independent Auditors' Report

The Annexure referred to in Independent Auditors' Report to the members of the Companyon the standalone Ind AS financial statements for the year ended 31st March 2021 wereport that:

Re: Suven Life Sciences Limited ('the Company')

i. In respect of its fixed assets:

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

(b) As explained to us the management has physically verified a substantial portion ofthe fixed assets during the year and in our opinion frequency of verification isreasonable having regard to the size of the Company and the nature of its assets. Thediscrepancies noticed on physical verification of fixed assets as compared to the books ofaccount were not material and have been properly dealt with in the books of accounts.

(c) In our opinion and according to the information and explanations given to us allthe title deeds of immovable properties are held in the name of the Company. On account ofdemerger the following immovable property and Vehicles transferred to SuvenPharmaceuticals Limited (Resultant Company) are still in the name of Suven Life SciencesLimited.

S. No Particulars Amount '
1 Land 1504.64 Lakhs
2 Buidings 8505.85 Lakhs

ii. In respect of its inventories.: According to the information and explanations givento us the inventories have been physically verified by the management during the year. Inour opinion the frequency of verification is reasonable. The discrepancies noticed onphysical verification of inventory as compared to the books of account were not materialand have been properly dealt with in the books of accounts.

iii. The Company has granted unsecured loans to one company covered in the registermaintained under Section 189 of the Companies Act 2013 ('the Act').

a. In our opinion the rate of interest and other terms and conditions on which theunsecured loan has been granted to the company listed in the register maintained underSection 189 of the Act is not prima facie prejudicial to the interest of the Company.

b. The schedule of repayment of principal and payment of interest has been stipulatedfor the loans granted and the repayment/receipts are regular.

c. The Principal and interest are not overdue in respect of loan granted to the companylisted in the register maintained under section 189 of the Companies Act 2013.

iv. In our opinion and according to the information and explanations given to us theCompany has complied with the provisions of section 185 and 186 of the Act with respectto the loans and investments made.

v. According to the information and explanations given to us the Company has notaccepted any deposits from the public within the meaning of Section 73 and 76 or any otherrelevant provisions of the Act and the rules framed there under.

vi. In respect of Company maintenance of cost records has not been prescribed by theCentral Government under sub-section (1) of section 148 of the Act in respect of theActivities of the Company. Accordingly paragraph 3(vi) of the order is not applicable tothe Company.

vii. In respect of Statutory dues:

(a) The Company is regular in depositing with appropriate authorities undisputedstatutory dues including provident fund employees' state insurance income-tax Goods& Service Tax duty of customs duty of excise cess and other material statutory duesapplicable to it with the appropriate authorities. According to the information andexplanations given to us no undisputed amounts payable in respect of such statutory dueswere outstanding at the year end for a period of more than six months from the date theybecame payable.

(b) According to the information and explanations given to us by management there areno dues outstanding of income-tax Goods & service tax service tax customs dutyvalue added tax and cess that have not been deposited on account of any dispute.

viii. Based on our audit procedures and as per the information and explanations givenby the management we are of the opinion that the Company has not defaulted in therepayment of dues to banks governments and financial institutions. The Company did nothave any debentures outstanding as at the year end.

ix. Based on the information and explanations given to us by the management theCompany has not raised any moneys by way of initial public offer or further public offerof equity shares convertible securities and debt securities. No term loans were takenduring the year by the Company.

x. Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and as per the information and explanations given bythe management we report that no material fraud by the Company or on the Company by itsofficers or employees has been noticed or reported during the year.

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 the information and explanations given to us theCompany is not a Nidhi Company. Accordingly paragraph 3(xii) of the Order is notapplicable.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with the related parties are incompliance with sections 177 and 188 of the Act where applicable and details of suchtransactions have been disclosed in the financial statements as required by the applicableaccounting standards.

xiv. According to the information and explanations given to us and based on ourexamination of the records of the Company the Company has approved the issue ofpreferential allotment of share warrants in accordance with section 42 of the companiesact 2013. As at 31st March 2021 company has received C36.92 Crores application money forwhich allotment is pending and the amount has been parked in a separate bank account in ascheduled bank.

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 directors or persons connected with him. Accordingly paragraph 3(xv) ofthe Order is not applicable.

xvi. The Company is not required to be registered under section 45- IA of the ReserveBank of India Act 1934.

For TUKARAM & CO LLP
Chartered Accountants
ICAI Firm Regn. No.004436S
Rajender Reddy K
Partner
Place: Hyderabad Membership No.231834
Date: 4th May 2021 UDIN:21231834AAAABE9333

To the Independent Auditors' Report

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

We have audited the internal financial controls over financial reporting of SuvenLife Sciences Limited ("the Company") as of 31st March 2021 in conjunctionwith our audit of the standalone Ind AS financial statements of the Company for the yearended 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 Reportingissued by the Institute of Chartered Accountants of India ('ICAI'). These responsibilitiesinclude the design implementation and maintenance of adequate internal financial controlsthat were operating effectively for ensuring the orderly and efficient conduct of itsbusiness including adherence to Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

Auditors' 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 on Audit of Internal Financial Controls over Financial Reporting(the "Guidance Note") and the Standards on Auditing issued by ICAI and deemedto be prescribed under section 143(10) of the Companies Act 2013 to the extentapplicable to an audit of internal financial controls both applicable to an audit ofInternal Financial Controls and both issued by the Institute of Chartered Accountants ofIndia. Those Standards and the Guidance Note require that we comply with ethicalrequirements and plan and perform the audit to obtain reasonable assurance about whetheradequate internal financial controls over financial reporting was established andmaintained and if such controls operated effectively in all material respects.

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 and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemover 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 standalone Ind AS financial statements for external purposes in accordancewith generally accepted accounting principles. A Company's internal financial control overfinancial reporting includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the Company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of standaloneInd AS financial statements in accordance with generally accepted accounting principlesand that receipts and expenditures of the Company are being made only in accordance withauthorisations of management and directors of the Company; and (3) provide reasonableassurance regarding prevention or timely detection of unauthorised acquisition use ordisposition of the Company's assets that could have a material effect on the standaloneInd AS 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 31st March 2021 based on theinternal control over financial reporting criteria established by the Company consideringthe essential components of internal control stated in the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting issued by the Institute of CharteredAccountants of India.

For TUKARAM & CO LLP
Chartered Accountants
ICAI Firm Regn. No.004436S
Rajender Reddy K
Partner
Place: Hyderabad Membership No.231834
Date: 4th May 2021 UDIN:21231834AAAABE9333

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