Year End :2024-03

Your Directors have pleasure in presenting their Report along with the Audited Accounts (Standalone as well as Consolidated) of your Company for the year ended 31^st March, 2024.

FINANCIAL SUMMARY

in crores)

Particulars	Standalone		Consolidated
	2023-2024 2022-2023		2023-2024	2022-2023
Revenue from Operations	327.35	402.55	2,615.77	2,412.92
Earning Before Interest Tax Depreciation and Amortisation (EBITDA)	6.80	7.76	286.51	332.20
Other Income	63.05	52.16	28.21	27.77
Depreciation & Amortisation (other than Goodwill)	55.90	50.49	265.16	235.02
Amortisation of Goodwill	45.71	45.71	45.71	45.71
(Loss)/Profit Before Interest and Tax	(31.76)	(36.29)	3.85	79.25
Finance Costs	68.19	57.92	119.97	85.69
(Loss)/Profit Before Tax and exceptional items	(99.95)	(94.20)	(116.12)	(6.44)
Exceptional Items	(3.05)	(2.00)	(6.14)	(48.15)
(Loss)/Profit Before Tax	(103.00)	(96.20)	(122.26)	(54.59)
Tax Expense	(26.59)	(37.33)	31.19	(24.79)
(Loss)/Profit for the year from Continued Operations	(76.41)	(58.87)	(153.45)	(29.80)
(Loss)/Profit for the year	(76.41)	(58.87)	(153.45)	(29.80)

PERFORMANCE AND OPERATION REVIEW Standalone Financial Results

In FY 2023-24, your Company achieved revenue of ' 327.35 crores as compared to ' 402.55 crores in FY 2022-23. Loss before tax stood at ' (103.00) crores in FY 2023-24 as against loss before tax ' (96.20) crores in FY 2022-23. Loss after tax for the year remain at ' (76.41) crores in FY 2023-24 as compared to loss after tax of ' (58.87) crores in FY 2022-23.

Earnings per share for the FY 2023-24 remains at ' (4.87) per share as against ' (3.75) per share in FY 2022-23.

Financial performance of your Company was mainly impacted adversely due to European Directorate for the Quality of Medicines & Health Care (EDQM) observations that were pointed out at the conclusion of the audit conducted at Company’s Bavla site by the SwissMedic and EDQM in February 2020. Certain Certificate of Suitability (CEPs) belonging to your Company were suspended due to said observations. Further details on current status of EDQM Audit observations is given under the head "EDQM Audit Update".

Consolidated Financial Results

In FY 2023-24, your Company achieved revenue of ' 2,615.77 crores as compared to ' 2412.92 crores in FY 2022-23. Loss before tax stood at ' (122.26) crores in FY 2023-24 as against Loss before tax of ' (54.59) crores in FY 2022-23. Loss for the year remains at ' (153.45) crores in FY 2023-24 as compared to Loss of ' (29.80) crores in FY 2022-23.

Earnings per share for the FY 2023-24 remains at ' (9.79) per share as against ' (1.90) per share in FY 2022-23. Cash Earning per share for the current year works out to ' 19.38 as against ' 20.79 in the previous year.

The net loss on a consolidated basis can mainly be attributable to the impact on financial performance because of EDQM observations as explained on a standalone basis and to certain one-time/exceptional items on a consolidated basis.

A detail analysis of the performance of the Company, its subsidiaries and financial results is given in the Management Discussion and Analysis Report, which forms part of this report.

EDQM AUDIT UPDATE

There was a joint inspection carried out during the quarter ending March 2020 by the Swissmedic and European Directorate for the Quality of Medicines & HealthCare (EDQM), due to which there were certain audit observations issued deficient to EU GMP Part II and other relevant Annexes for the Company’s Bavla site. There was an impact on the production at the Company’s Bavla manufacturing site due to the observations received, which impacted the revenue and profitability of the Company’s operations at Bavla since March 2020 till now.

The re-inspection jointly by the EDQM and Italian Medicines Agency (AIFA) of the Bavla site was successfully done from 18^th September, 2023 to 20^th September, 2023. On 30^th January, 2024, the Company has received the "Attestation of Inspection” from the European Directorate for the Quality of Medicines & HealthCare (EDQM) Authority for the Product inspected during 18^th September, 2023 to 20^th September, 2023. On 2^nd February, 2024, the Company in addition to the "Attestation of Inspection” certificate, also received the "Certificate of GMP (Good Manufacturing Practice) Compliance” from these authorities.

Thus, now the Company’s Bavla site is fully in compliance with the EU GMP guidelines.

JAPANESE PMDA INSPECTION

Your Company’s Bavla site was successfully inspected by the Japanese Pharmaceuticals and Medical Devices Agency (PMDA) from 31^st July, 2023 to 3^rd August, 2023. On 23^rd January, 2024, the Company has received an intimation regarding its Bavla site has been declared GMP Compliant by the PMDA.

US FDA INSPECTION

The Company’s Bavla site was also inspected by US Food and Drug Administation (USFDA) during 4^th March, 2024 to 7^th March, 2024. On 8^th May, 2024 the Company has received Establishment Inspection Report (EIR) from the US FDA indicating closure of the inspection.

DIVIDEND

The results of the Company do not permit payment of any dividend. Hence your Directors do not recommend the payment of any dividend for the financial year ended 31^st March, 2024.

TRANSFER TO RESERVES

Your Company has not transferred any amount to the general reserves.

DEPOSIT

The Company has neither accepted nor invited any deposit from public, falling within the ambit of Section 73 of the Companies Act, 2013 and The Companies (Acceptance of Deposits) Rules, 2014.

OPERATIONS

Your company has achieved a significant milestone in terms of receiving the regulatory clearance from the EDQM, which will go a long way in ensuring that the business operations come back on track over the next 12-18 months. Your company expects the EDQM clearance to result into incremental business on account of the following factors:

• The company is already witnessing an increasing order book from existing customers in the European region, which is one of the major markets for India business. The EDQM clearance allows the customers to procure the APIs from the company for more countries within Europe, where otherwise they were not able to sell their final product using company’s API.

• New customers have already started approaching for business opportunities that we are evaluating internally and some it look very promising starting FY 2025. The EDQM clearance allows us to get more and more business from customers for APIs in the European region.

• We are optimising the manufacturing and marketing strategy such that we have better utilisation of the capacities between Switzerland and India. Switzerland entity will increase its focus more on getting more and more molecules for development and India will increase its focus on larger scale manufacturing thereby bringing in cost efficiencies and increasing the profitability for the group. This optimisation will not only improve bottom line but will add more customer to portfolio and more order to the basket.

• Since the Company’s Bavla site has been successfully inspected by all major regulatory agencies in the near past, it mitigates the regulatory risk to a large extent for the short to medium term. We have ensured that the changes made in Bavla and in Naroda sites are transformational in nature and it can stands firm to pass any audit in the future.

The significant amount of capex done in Bavla and Naroda sites in India would help your company to cater to the increasing order requirements of the customers post the EDQM clearance. Your manufacturing subsidiaries have been delivering growth on a year on year basis and the same is expected to continue in the future. Around 50% of your manufacturing units in Bavla are already running, though not at optimal efficiency, your company shall be reopening one after the other units as the orders from the customers keeps on increasing. This would require certain refurbishment and maintenance expenditure to be incurred in addition to the ongoing capex on the Water Purification Plant. The Multiple Effect Evaporator (MEE) plant construction has been completed at Naroda site. The MEE plant is expected to reduce the cost of treating the effluent in Naroda and increase the compliance level in terms of ESG for the site.

Your company’s manufacturing subsidiaries under CARBOGEN AMCIS, have been consistently delivering growth performance. The qualification of the newly expanded capacity for the Antibody Drug Conjugate (ADC) facility in Switzerland was completed and the manufacturing shall begin from FY25. The French subsidiary faced teething issues in starting its new manufacturing plant due to technical issues with the first manufacturing line and hence the operation of the line, which was expected in January, 2024 got delayed by six months. This led to significantly higher expenses for this plant in order to make the necessary changes to the manufacturing line, resulting into an adverse impact on the consolidated performance. Additionally, the Dutch subsidiary faced high input costs in terms of the prices of a key raw material, which the company is now in the process of renegotiating the price with its exiting supplier as well as finding new suppliers for this raw material so that it can increase its profitability.

CRAMS

The CRAMS segment is a major contributor to your company in terms of revenues and profitability and now with the addition of the French facility, your company will be able to offer end to end solution to the customers, right from developing an Active Pharmaceutical Ingredient to manufacturing finished dosage form where parenteral is the delivery form. Currently, your company has a large pipeline of molecules under development across different phases and 29 molecules, which are already commercialized giving a wonderful pathway for growth in terms of development and commercial business. Your company was able to successfully partner the customers whose two molecules moved from development phase to commercial phase over the last 12 months. With the regulatory clearance especially from the EDQM having been received for the Bavla manufacturing site in February, 2024, your company expects a significant increase in the CRAMS business being serviced out of this facility over the next years and this would be one of the key growth drivers for the business going forward. Your company has been targeting small and mid sized biotech companies for securing molecules in early phases of development, which has proven to be a great strategy both from a customer diversification point of view as well as for increasing development revenue from such niche molecules on a consistent basis. Your company is also focussed on improving capacity utilization levels in your Shanghai plant by transferring manufacturing of more intermediates to Shanghai rather than manufacturing them in Switzerland. The Manchester facility of your company has been supporting the Swiss facility as well as catering to the customers directly quite well due to which the capacity utilization has increased to the maximum level.

Vitamin D Analogues and Cholesterol

Your company’s Vitamin D and Cholesterol revenues increased during the year however the margins remain subdued due to the elevated prices of a key raw material. The energy costs though moderated during the course of the year, the impact was mollified due to

increased raw material prices and lower sales of Vitamin D analogues. Your company expects the conditions to improve in the mid-term due to renegotiation of raw material price with one of the key suppliers and finding alternate suppliers for the supplies of this raw material. This should result in improved profitability for the mid to long term. Your company has also been working towards ramping up its production of softgel capsules for formulation Vitamin D analogues in India.

Generic API and Disinfectant Business

Your company shall keep focussing only on those quaternary compounds and generic APIs which meet the minimum margin criteria. Certain low margin products are being discontinued or shall be sold only in those geographies where the margin realizations are greater than the minimum threshold. Your company plans to expand the portfolio of imaging dyes as it sees a lot of unmet need in that segment of generic products and expects the demand to keep growing. Your company has been making lot of improvements in its facility in Naroda location as well as in Bavla location in order to reduce the costs of manufacturing these generic products and thus fetch a better margin.

Capital Expenditure Plan at the Company’s subsidiaries located at Switzerland and France

Your company has completed two major capex programs in France and Switzerland, which include the new greenfield project related to development and manufacturing parenteral finished dosages in France and that related to expansion of ADC capacity on the back of a large ADC supply contract for a large innovator based out of Japan. The ongoing project right now is in relation to the digital transformation across all CARBOGEN AMCIS entities, which would progressively go live one after the other starting from FY 26 onwards.

Performance of Major Subsidiary Associates

The major subsidiary companies have performed quite well during the year under review. CARBOGEN AMCIS AG., Switzerland has performed quite satisfactorily as it reported a healthy revenue of ' 1815.52 crores and operating profit of ' 317.80 crores

CARBOGEN AMCIS BV. during the year, reported revenue of ' 349.64 crores and operating profit of ' 72.06 crores. CARBOGEN ACIS (Shanghai) Co. Ltd. has reported revenue of ' 158.11 crores and operating profit of ' 27.96 crores. CARBOGEN AMCIS Ltd. (UK) reported a revenue of around ' 109.92 crores and operating loss of ' (17.41) crores. CARBOGEN AMCIS SAS reported revenue of ' 44.37 crores and operating loss of ' (96.72) crores.

The major marketing subsidiaries viz. Dishman USA Inc. reported revenue of ' 86.11 crores and operating loss of ' (5.21) crores. Dishman CARBOGEN AMCIS (Europe) Ltd reported revenue of ' 183.72 crores and operating loss of ' (0.85) crores during the year under review. Other subsidiaries have performed reasonably well during the year under review.

NON-CONVERTIBLE DEBENTURES

As the members are aware that in January 2023 the Company has issued 5,000 (five thousand) senior, secured, rated, listed, redeemable, principal protected, market linked, non-convertible debentures of a face value of ' 1,00,000 (Indian Rupees One Lakh only) each, aggregating to ' 50.00 crores (Indian Rupees Fifty crores only) on a private placement basis ("Debentures”). The said Debentures are listed on BSE Limited under Scrip Code: 974556 and due for Repayable/Redemption along with premium on 21^st April, 2025. In respect of the said Debentures, during the year the certain covenants related to the said Debentures were not met as on 31^st March, 2024. However, subsequent to the balance sheet date but prior to the date of the Boards’ Report, the Covenants were revised as requested by the Company, from the debenture holders and is in compliance with the same.

Further, the Board of Directors in its meeting held on 30^th May, 2024, have approved the issuance up to 5,000 (Five thousand) Senior, secured, rated, listed, redeemable, taxable, non-convertible debentures of face value of ' 1,00,000/- (Rupees One Lac only) each, aggregating up to ' 50.00 crores (Rupees Fifty crores), on a private placement basis ("NCDs”). The said NCDs proposed to be listed on BSE Limited.

RESEARCH AND DEVELOPMENT

This year after extended efforts to complete, qualify and obtain certification for our new site in France, your Company has finally been able to successfully start our aseptic filling and clinical batch manufacturing activities at this site.

This state-of-the-art filling and finishing facility contain two manufacturing lines, they have started to be operational and your Company has already served several Japanese, American and European customers, Company’s R&D activity on complex formulations is also fully operational to support the clinical development of parenteral products. The Company can formulate any type of sterile liquid form. The Company's versatile lines can quickly switch from vials to pre-filled syringes thanks to the high modularity of their design, which offers the Company's customers many options in their therapeutic strategy. Furthermore, regarding the size of the vials, the Company can go from 2R to 100R, which covers most pharmaceutical applications. With this brand-new asset, the Company will certainly be able to provide new clinical products to its customers’ patients who need breakthrough treatments.

At the same time, your Company has continued to help its customers file New Drug Applications (NDAs), which has significantly improved patient well-being. Indeed, the Company continues to work on key therapeutic areas, particularly oncology, endocrinology, rare diseases and orphan applications. The Company’s primary mission remains to solve complex technical challenges.

This is made possible by the strength of its global R&D. The Company's primary mission remains to solve

complex technical challenges. The Company has a broad range of technologies and extensive capabilities to manufacture APIs, complex raw materials and intermediates. This deep expertise across all domains supports and helps bring its customers’ science to life. However, the Company has not abandoned its goal of supporting treatment in other therapeutic areas and does so by using its best science, technologies and a passion for solving complex problems.

Indeed, your Company has supported pharmaceutical companies of all sizes around the world by offering them a high-end service to optimize their time to market and improve the sustainability of their entire supply chain.

The Company's global research and development efforts continue, focusing on the development of new applications around its own product portfolio. Much attention has been paid in recent years to demonstrating the added value brought by Calcifediol compared to classic vitamin D3 (cholecalciferol). Indeed, new patents are currently being approved.

Dishman Carbogen Amcis Group continues to actively support promising partnerships with companies to test several new chemical entities with the prospect of massive changes for the well-being of people. The results are promising, and the Company continues to have high hopes in this field.

Your Company’s global R&D pipeline is still at its highest level ever, both in terms of the number of projects but also, and more importantly, the diversity of the customer base. Ensuring strong sustainability and multiple future successes. The Company’s global R&D teams continually demonstrate their skills to accomplish the complex and challenging tasks that await them before moving on to real products that benefit today’s patients.

As usual, the Company’s product R&D teams also have a vital role to play in growing the Company’s business by developing new quaternary compounds, phase transfer catalysts, disinfectants and vitamin D analogues to keep Dishman at the forefront of innovation in these markets.

Your Company has also demonstrated this year its ability to leverage all the levers of its global entities to better use all the skills that exist across all R&D platforms in India, Switzerland, the Netherlands, China and the United Kingdom in a more coordinated manner to better support evolving and diversified customers.

SAFETY, HEALTH & ENVIRONMENT (SHE)

Company’s products and processes are developed in accordance with strictly defined local and international rules to ensure safety and Health of workers as well as the environment. This is achieved by conducting the Risk Assessment, Qualitative Risk Assessment, Process Hazard Assessment, Identification of significant environmental aspects, Safety Audits, customer audits, HAZOP study and Environment audits. Safety &

Environment Management Program are being taken to reduce the Significant Risk & Environment Impacts.

Dishman is committed towards excellence in Quality, Health, Safety and Environment Management and ensure that those working with the Company are safe at work and that everyone takes responsibility for achieving this. We include Environment, Health and Safety (EHS) and climate change-related considerations in our business decisions and strive to minimize the environmental impact of our operations on the environment. Measuring, monitoring, reviewing, analysing and reporting on environmental, health and safety performance is an important part of continuous improvement in our EHS performance. Dishman’s EHS conducts strategic planning to establish long-term EHS goals, assess resources required to achieve specific goals, and ensure critical business alignment.

Dishman evaluates customer feedback and satisfaction by internal and external communication in proposing and establishing its long-term relations and to achieve goals in manufacturing operations. Dishman’s products and processes are developed in accordance with strictly defined local and international rules to ensure safety and Health of workers as well as the environment. This is achieved by conducting the Risk Assessments to identify potential hazards and analyse what could happen if a hazard occurs. Dishman has the standard operating procedures/ guidelines/policy for SHE and Identification of significant environmental aspects, Safety Audits, customer audits and environment audits. Safety & Environment Management Program are being taken to reduce the Significant Risk & Environment Aspects.

Dishman continues to pursue world class operational excellence on Process Safety Management (PSM). Dishman has established the capabilities within the Company and developed in-house experts in various facets of PSM. Dishman has the process safety management (PSM) program, which is the proactive identification, evaluation and mitigation or prevention of chemical releases that could occur as a result of failures in processes, procedures or equipment at site. Process Hazard Analysis (PHA) at various plants is being carried out to reduce process safety risks. Process Safety Management covers the 14 elements required as per the standards.

The Company’s QHSE policy is being implemented, among others, through (i) Upgradation of existing Effluent treatment system by investing ' 40 crores. The revamped conventional effluent treatment system and MEE being state of the art and fully automated units. (ii) Maintaining the "Zero Discharge” of waste water by series of treatment and reuse. (iii) Stripper system, Multiple effect evaporator and ATFD for concentrated effluent stream. (iv) Biological Effluent Treatment System, Tertiary treatment, Two Stage R.O. System and Multiple Effect Evaporator for Dilute Stream Effluent. (v) Safe disposal of all types of solid and liquid waste ensuring zero harm to the environment and compliance of all norms established by law of the land.

(vi) Practicing On-site emergency plan by conducting mock-drills. (vii) Training on first aid and emergency response team incorporated at regular intervals by third party, Maintain and displayed the First aider and ERT list. (viii) Replacement of hazardous process/ chemical to non-hazardous process for converting into low hazards by PSI/PHA/Hazop study and Provide recommendation and also tracking the CAPA sheet and ensure closure. (ix) Fire detection and protection system available at site. (x) Revised QSHE policy on June 2023 with commited to Proactive identification and implementation of occupational health hazard, safety and environment aspects. (xi) Ensure 100% PPE’s compliance to all employees as well as contractors/ visitors also. (xii) Conducting intensive QHSE Training programs including contractor employees and monitoring the effectiveness of the same. (xiii) Participation of employees in Safety committee meetings at all levels and celebrating the National Safety Day/Week and World Environment Day as well as observing Fire Service Day. (xiv) Tree plantation to increase the green cover at site. (xv) Independent safety and environment audits at regular intervals by third party and also in-house by cross functional team.

(xvi) Independent safety and environment audit at regular intervals for hazardous waste disposal vendors.

(xvii) In-house medical and health facility at site for pre-employment & periodical medical check-up of all employees including contract employees. (xviii) Additional health checkup for employees based on their occupational needs. (xix) Blood Donation Camp at site 2023 in association with the Sanjivani Blood Bank, Ahmedabad for social cause.

Dishman, certified of excellence towards sustainable development and to go beyond compliance, integrated its ISO 14001:2015 for EMS, ISO 9001:2015 for QMS and ISO 45001:2018 for Occupational, Health and Safety Management systems. The Company is also certified EN/ISO 13485:2016 for Medical Device Quality Management System for Disinfectant Products. The adopted systems are being monitored for continual improvements.

CREDIT RATING

India Ratings & Research Pvt. Ltd. ("Ind-Ra") has assigned both the Long-Term Loan and Short-Term Loan rating of the Company as IND A with a Stable Outlook and IND A1 with a Stable Outlook, respectively. It has also assigned Rating for market linked non-convertible debentures as Ind PP-MLD A with a Stable Outlook and for Proposed non-convertible debentures rating has been assigned as IND A with a Stable outlook.

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

Pursuant to the provisions of Section 124(5) and 125 of the Companies Act, 2013, the Company has transferred the unpaid or unclaimed dividend up to and for the financial year 2016-17 (for interim dividend declared), to the Investor Education and Protection Fund (‘IEPF’) established by the Central Government.

Year wise amount of unpaid/unclaimed dividend lying in the unpaid account up to the Year and the corresponding shares, which are liable to be transferred to the I EPF, and the due dates for such transfer are given in details in the report on Corporate Governance which forms part of this Annual Report.

LISTING

The equity shares of the Company are listed on the National Stock Exchange of India Ltd., Mumbai (NSE) and BSE Ltd., Mumbai; while market linked nonconvertible debentures issued by the Company are listed on BSE Ltd. Annual listing fees for the FY 2024-25, as applicable, have been paid before due date to the concerned Stock Exchanges.

FORMATION OF VARIOUS COMMITTEES

Your Company has several Committees which have been established as part of the best Corporate Governance practices and are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

The Company has following Committees:

• Audit Committee

• Stakeholders Relationship Committee

• Nomination and Remuneration Committee

• Corporate Social Responsibility Committee

• Risk Management Committee

• Management Committee

• Internal Complaints Committee (for redressal of Sexual Harassment complaint)

During the year, the Board has accepted all the recommendations made by various committees including Audit Committee. The details with respect to the compositions, powers, terms of reference, number and dates of meetings of such committees held during the year are given in details in the report on Corporate Governance which forms part of this Annual Report.

DISCLOSURES UNDER THE COMPANIES ACT, 2013

i) Annual Return

In accordance with the Companies Act, 2013, the annual return in the prescribed format is available at https://imdcal.com/images/files/Investor-Relations/ Annual%20Return/Annual%20Return%20for%20 the%20year%20ended%2031.03.2024.pdf

ii) Board Meetings

Regular Meetings of the Board are held, inter-alia, to review the financial result of the Company. Additional Board Meetings are convened to discuss and decide on various business policies, strategies and other businesses. Due to business exigencies, certain business decisions are taken by the board through circulation from time to time.

2023 and 14^th February, 2024. Detailed information on the meetings of the Board is included in the report on Corporate Governance, which forms part of this Annual Report.

iii) Related Party Transactions

All Related Party Transactions are placed before the Audit Committee and also the Board for approval. All the related party transactions entered into during the financial year were on an arm's length basis and were in the ordinary course of business. Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed Form AOC-2, is appended as Annexure A to this Board's report. The policy on Related Party Transactions has been approved by the Board and uploaded on the website of the Company. The details of the transactions with Related Party are provided in the accompanying financial statements vide note no.31 of notes on financial statement as per requirement of Ind AS 24 - related party disclosure. These transactions are not likely to conflict with the interest of the Company at large. All significant transaction with related parties is placed before audit committee periodically.

iv) Particulars of Loans, Guarantees or Investments under Section 186

The details of Loans, Investments and Guarantees covered under the provisions of Section 186 of the Companies Act, 2013 are given in the Notes to the Financial Statements forming part of Annual Report.

v) Material Changes and Commitments affecting the Financial Position of the Company occurred after the end of Financial Year

There are no material changes and commitments affecting the Financial Position of the Company occurred after the end of financial year.

vi) Subsidiaries, Joint Ventures and Associate Companies

During the year, following changes happened in Subsidiary, Joint Ventures and Associate Companies:

• During the year, a wholly owned subsidiary Company namely "Visible Investment Pvt. Ltd.” has been converted into Public Limited Company w.e.f. 27^th July, 2023 and also name of the said Company has been changed to "Dishman Medicare Limited” w.e.f. 15^th September, 2023.

In view of the above, the total number of subsidiaries including step down subsidiaries as on 31^st March, 2024 was 19 (Nineteen).

vii) Accounting Impact due to revision in useful life of Goodwill

The amalgamation held between erstwhile Dishman Pharmaceuticals and Chemical Limited

and the Company accounted in the year 201617 under the "Purchase Method” as per the then prevailing Accounting Standard 14 - Accounting for Amalgamations, as referred to in the Scheme of Amalgamation sanctioned by the Hon’ble High Court, Gujarat, which is different from Ind AS 103 "Business Combinations”. The excess of consideration payable over net assets acquired had been recorded as goodwill amounting to ' 1,326.86 crores, represented by underlying intangible assets acquired on amalgamation and was being amortized over the period of 15 years from the Appointed Date i.e. 1^st January, 2015.

Last year, Board of Directors has re-assessed the life of goodwill in accordance with the power confirmed by Hon’ble High Court of Gujarat through scheme, considering the benefits to be available to the Company going forward, and accordingly has decided to amortize the carrying value of ' 685.58 crores over a revised life of 15 years starting from 1^st April, 2022. Had the useful life of the Goodwill not been revised by the Board of Directors, the Depreciation and Amortization expense for the year ended 31^st March, 2024 would have been higher by ' 42.75 crores and profit before tax year ended 31^st March, 2024 would have been lower by equivalent amount.

CONSOLIDATED FINANCIAL STATEMENT

Pursuant to the provisions of Sections 129, 134 and 136 of the Companies Act, 2013 read with rules framed thereunder and pursuant to Regulations 33 and 52 of SEBI (LODR) Regulations, 2015, your Company had prepared consolidated financial statements of the Company and its subsidiaries and a separate statement containing the salient features of financial statement of subsidiaries, joint ventures and associates in Form AOC-1 forms part of the Annual Report.

The annual financial statements and related detailed information of the subsidiary companies will be provided on specific request made by any shareholders and the said financial statements and information of subsidiary companies are open for inspection at the registered office of the Company during office hours on all working day except Saturdays, Sundays and Public holidays between 2 p.m. to 4 p.m. The separate audited financial statement in respect of each of the subsidiary companies is also available on the website of the Company at www.imdcal.com.

As required under Regulations 33 and 52 of SEBI (LODR) Regulations, 2015 and in accordance with the requirements of Ind AS 110, the Company has prepared Consolidated Financial Statements of the Company and its subsidiaries and is included in the Annual Report.

GENERAL DISCLOSURE

i) Issue of Equity Shares with differential rights as to dividend, voting or otherwise

During the year 2023-24, the Company has not issue any of Equity Shares including sweat equity with differential rights as to dividend, voting or otherwise.

ii) Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and ESOS

During the year, the Company has not issued any shares under Employee Stock Option Scheme.

Employee Stock Option Plan 2021

As the members are aware that members in their Annual General Meeting held on 19^th July, 2021 approved an employee stock option plan for the benefits of employees of the Company and employees of its existing and future subsidiary companies in India or abroad, namely, "Dishman Carbogen Amcis Limited - Employee Stock Option Plan 2021” to be implemented through an employee welfare trust ("ESOP Trust”) ("DCAL ESOP 2021”) and administered by the Company through Board of Directors and/or Nomination and Remuneration Committee ("NRC”) in accordance with the applicable laws.

Till date the Company has not granted any option under DCAL ESOP 2021. Hence, Disclosures with respect to Compliance to section 62 of the Companies Act, 2013 read with Rule 12 of Companies (Share Capital and Debentures) Rules, 2014 and Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 is not required for the year under review.

iii) Whether the Managing Director or the Whole-Time Directors of the Company receive any remuneration or commission from any of its holding/subsidiary companies

Mr. Arpit J. Vyas, Global Managing Director of the Company has received remuneration as a Director from one foreign wholly owned subsidiary Company namely CARBOGEN AMCIS AG., Switzerland, which is in compliance with the provisions of the Companies Act, 2013. He being a Partner of Adimans Technologies LLP, a holding LLP of the Company, has right to receive profit in the ratio of 20% from the said LLP.

Mrs. Deohooti J. Vyas, Whole-Time Director, being a Partner of Adimans Technologies LLP, a holding LLP of the Company, has right to receive profit in the ratio of 40% from the said LLP.

Mr. Arpit J. Vyas has voluntarily decided not to draw any remuneration from the Company during financial year 2023-24. Other details of remuneration pertaining to Mr. Arpit J. Vyas and Mrs. Deohooti J. Vyas have been disclosed in report on Corporate Governance.

iv) Any significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future

There are no significant and material orders passed by the Regulators or Courts or Tribunals which could impact the going concern status and the Company's future operations.

v) Secretarial Standards

Secretarial Standards issued by the Institute of

Company Secretaries of India as applicable to the Company were followed and complied with during 2023-24. The Company has devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of

Company Secretaries of India and that such systems are adequate and operating effectively.

DIRECTORS & KMPS Retire by Rotation

Mr. Arpit J. Vyas (DIN: 01540057), Director of the Company retires by rotation at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment. Based on the performance evaluation and the recommendation of the Nomination and Remuneration Committee, the Board recommends his re-appointment, as a Director and agenda seeking shareholders’ approval for his re-appointment forms part of the Notice.

Completion of Tenure of Independent Directors

Mr. Ashok C. Gandhi (DIN: 00022507) and Mr. Sanjay S. Majmudar (DIN: 00091305) have completed their second and final term as an Independent Directors and consequently ceased to be Directors of the Company and member of various committees of the Board w.e.f. close of business hours on 31^st March, 2024. The Board of Directors and the Management of the Company expressed deep appreciation and gratitude to Mr. Ashok C. Gandhi and Mr. Sanjay S. Majmudar for their extensive contribution and stewardship as an Independent Directors. The disclosure in this regard is available at https://www.imdcal.com/images/files/ Investor-Relations/Corporate%20Announcements/ Disclosure%20pursuant%20to%20Regulations%20 30%20and%2051%20of%20SEBI%20(LQDR)%20 Regulations.%202015%20:%20Completion%20of%20 Tenure%20of%20an%20Independent%20Directors%20 dated%2001.04.2024.pdf

Re-Appointment

As reported last year, based on the recommendation of Nomination and Remuneration Committee and the Board, the members at the previous 16^th AGM held on 27^th September, 2023 passed special resolution for reappointment of Ms. Maitri K. Mehta (DIN: 07549243) as an Independent Director of the Company for the second term of 5 (Five) consecutive years effective from 1^st April, 2024. In the opinion of the Board, Ms. Maitri K. Mehta appointed during the year is a person of integrity and possess vide experience and expertise beneficial to the Company and she has also cleared online proficiency self-assessment test conducted by Indian Institute of Corporate Affairs, for appointment as Independent Directors of the Company.

Key Managerial Personnel

As reported last year, based on the recommendation of Nomination and Remuneration Committee and the Board, the members at the previous 16^th AGM held on 27^th September, 2023 passed special resolution for reappointment of Mr. Arpit J. Vyas (DIN: 01540057) as a Global Managing Director of the Company for a further period of 5 (five) years with effect from 1^st June, 2024.

Further, pursuant to the provisions of Section 203 of the Act, the Key Managerial Personnel of the Company as on 31^st March, 2024 are i) Mr. Arpit J. Vyas, Global Managing Director; ii) Mr. Harshil R. Dalal, Global Chief Financial Officer and iii) Ms. Shrima Dave, Company Secretary.

Statement of Declaration by Independent Directors

The Company has received the necessary declaration from each Independent Director in accordance with Section 149(7) of the Companies Act, 2013, read with Regulation 25(8) of the SEBI (LQDR) Regulation, 2015 ("Listing Regulations”) that he/she meets the criteria of independence as laid down in the Companies Act, 2013 and the Listing Regulations.

Also, Independent Directors affirmed that they have complied with the Code for Independent Directors prescribed in Schedule IV to the Act as well as Code of Conduct for Directors and senior management personnel formulated by the Company.

In the opinion of the Board, there has been no change in the circumstances which may affect their status as Independent Directors of the Company and the Board is satisfied of the integrity, expertise, and experience (including proficiency in terms of Section 150(1) of the Act and applicable rules thereunder) of all Independent Directors on the Board. Further, in terms of Section 150 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, Independent Directors of the Company have included their names in the data bank of Independent Directors maintained with the Indian Institute of Corporate Affairs.

Board Evaluation & Criteria

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of SEBI (LQDR) Regulations, 2015, a structured questionnaire was prepared after taking into consideration the various aspects of the Board's functioning, composition, effectiveness of processes & information etc. of the Board and its committees. The Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Committees and Independent Directors after seeking inputs from all the members of the Board and its Committees. The Board of Directors expressed their satisfaction with the evaluation process.

Nomination and Remuneration Committee also reviewed the performance of individual directors on the basis of criteria such as the contribution of the individual director to the Board and Committee Meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

Independent Directors' Meeting

A Separate meeting of Independent Directors was held on 14^th February, 2024 without the attendance of Non-Independent Directors and members of the Management. In the said meeting, Independent Directors reviewed the followings:

• Performance evaluation of Non Independent Directors and Board of Directors as a whole;

• Performance evaluation of the Chairperson of the Company taking into account the views of executive directors and Non-Executive Directors;

• Evaluation of the quality of flow of information between the Management and Board for effective performance by the Board.

The Independent Directors expressed their satisfaction with the evaluation process.

Board Diversity

The Company recognizes and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help to retain our competitive advantage. The Board has adopted the Board Diversity Policy which sets out the approach to diversity of the Board of Directors. The Board Diversity Policy is available on Company’s website www.imdcal.com.

POLICY ON DIRECTOR'S APPOINTMENT AND REMUNERATION

The salient features of the Policy on Directors' appointment and remuneration of Directors, KMP & senior employees and other related matters as provided under Section 178(3) of the Companies Act, 2013 is stated in the report on Corporate Governance which is a Part of the Board’s Report. The detailed Policy is placed on the website of the Company at https://imdcal.com/images/ files/Investor-Relations/Policies%20of%20Dishman%20 Carbogen%20Amcis%20Limited/Policy%20on%20 Remuneration%20of%20Directors.%20Kev%20 Managerial%20Personnel%20&%20Senior%20 Emplovees%20AND%20Succession%20Policv.pdf

DISCLOSURE UNDER RULE 5 OF THE COMPANIES (APPOINTMENT & REMUNERATION) RULES, 2014

The information required under Section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 are provided in separate annexure forming part of this Report as Annexure B.

The statement containing particulars of employees as required under Section 197 of the Companies Act, 2013 read with Rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, forming part of this report as Annexure C.

FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTOR

The Independent Directors are provided with necessary documents, brochures, reports and internal policies to enable them to familiarize with the Company’s procedures and practices. The Company undertook various steps to make the Independent Directors have full understanding about the Company. The Company has through presentations at regular intervals, familiarized and updated the Independent Directors with the strategy, operations and functions of the Company and Pharma Industry as a whole. Generally, site visits to various plant locations are organized for the Directors to enable them to understand the operations of the Company. The details of such familiarisation programmes have been disclosed on the Company's website at https://imdcal.com/ir-index. php?Policies%20of%20Dishman%20Carbogen%20 Amcis%20Limited/Familiarisation%20Programme%20 for%20Independent%20Directors As a part of familiarisation programme, the Company has updated the Independent Directors with the strategy, operations and functions of the Company including its subsidiaries in Board Meetings held on 23^rd May, 2023, 9^th August, 2023, 8^th November, 2023 and 14^th February, 2024.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, state that :

• in the preparation of the annual accounts for the financial year ended 31^st March, 2024, the applicable accounting standards have been followed along with proper explanation relating to material departures;

• the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period;

• the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

• the Directors have prepared the annual accounts on a going concern basis;

• the Directors, have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

• the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

INTERNAL FINANCIAL CONTROL SYSTEM

The details in respect of internal financial control system and their adequacy are included in Management Discussion and Analysis Report, which forms part of this report.

INSURANCE

Assets of your Company are adequately insured against various perils.

RISK MANAGEMENT FRAMEWORK & POLICY

In compliance with the provisions of Regulation 21 of SEBI (LODR) Regulations, 2015, the Board of Directors has constituted a Risk Management Committee. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Director's Report. The Risk Management policy is formulated and implemented by the Company in compliance with the provisions of the Companies Act, 2013 and SEBI (LODR) Regulations, 2015. The policy helps to identify the various elements of risks faced by the Company, which in the opinion of the Board may threaten the existence of the Company.

As per Regulation 17(9) of SEBI (LODR) Regulations, 2015, the Company has framed formal Risk Management framework for risk assessment and risk minimization for Indian operation which is periodically reviewed by the Board of Directors to ensure smooth operations and effective management control. The Audit Committee has additional oversight in the area of financial risks and control.

Risk management is an integral part of business practices of the Company. The framework of risk management concentrates on formalizing a system to deal with the most relevant risks, building on existing management practices, knowledge and structures.

The Company has framed formal Risk Management framework to identify, evaluate business risks and opportunities. Corporate Risk Evaluation and Management is an ongoing process within the Organization. The Company’s Risk Management framework is well-defined to identify, monitor and minimizing/mitigating risks. While defining and developing the formalized risk management system, leading standards and practices have been considered. The risk management system is relevant to business reality, pragmatic and simple.

The Risk Management framework has been developed and approved by the Risk Management Committee

in accordance with the business strategy. Risk Management and Risks & concerns have also been discussed in the Management Discussion and Analysis Report, which forms part of this report.

The key elements of the framework include Risk Structure; Risk Portfolio and Risk Measuring & Monitoring and Risk Optimising. The implementation of the framework is supported through criteria for Risk assessment, Risk forms & MIS.

The brief role of Risk Management Committee as per amended SEBI (LODR) Regulations, 2015 are:

• To formulate a detailed Risk Management Policy;

• To ensure that appropriate methodology, processes and systems are in place to monitor and evaluate risks associated with the business of the Company;

• To monitor and oversee implementation of the risk management policy, including evaluating the adequacy of risk management systems;

• To periodically review the risk management policy including by considering the changing industry dynamics and evolving complexity;

• To keep the board of directors informed about the nature and content of its discussions, recommendations and actions to be taken.

WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company has adopted a Whistle Blower Policy pursuant to the requirements of the Companies Act, 2013 and the SEBI (LODR) Regulations, 2015. The Policy empowers all the stakeholders to raise concerns by making protected disclosures as defined in the Policy.

The policy also provides for adequate safeguards against victimization of whistle blower who avail of such mechanism and also provides for direct access to the Chairman of the Audit Committee, in exceptional cases. The details of the Whistle Blower Policy are explained in the Report on Corporate Governance and the Policy is available on the website of the Company at www.imdcal.com.

SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

There were no incidences of sexual harassment reported during the year under review, in terms of the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

AUDITORS AND AUDITORS' REPORT Statutory Auditors

M/s. T R Chadha & Co. LLP, Chartered Accountants (Firm Registration No. 006711N/N500028) were appointed as Statutory Auditors of the Company to hold office until the conclusion of 19^th AGM to be held in the year 2026.

The Company has received a confirmation from M/s. T R Chadha & Co. LLP, Chartered Accountants (Firm Registration No. 006711N/N500028) to the effect that they are not disqualified from continuing as Auditors of the Company.

The Notes on Financial Statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification or reservation. There is also no fraud has been reported by the Auditors in their Audit Report for the year ended 31^st March, 2024.

Internal Auditors

M/s. Sharp & Tannan Associates, Chartered Accountants (Firm Registration No. 109983W) have been internal auditors of the Company for the year 2023-24. Internal auditors are appointed by the Board of Directors of the Company on a yearly basis, based on the recommendation of the Audit Committee. The Internal Auditors’ reports and their findings on the internal audit, have been reviewed by the Audit Committee on a quarterly basis. The scope of internal audit is also reviewed and approved by the Audit Committee.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the rules made thereunder, the Company had appointed Mr. Ashok P. Pathak, Practicing Company Secretary (Membership No. ACS: 9939; CP No: 2662), as Secretarial Auditors to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is appended in the Annexure D to the Directors' Report. The observations and comments, if any, appearing in the Secretarial Audit Report are selfexplanatory and do not call for any further explanation/ clarification. The Secretarial Auditors Report does not contain any qualification, reservation or adverse remark and also no fraud has been reported for the year ended 31^st March, 2024.

Cost Audit

Central Government has notified rules for Cost Audit and as per Companies (Cost Records and Audit) Rules, 2014 issued by Ministry of Corporate Affairs, Company is not falling under the Industries, which will subject to Cost Audit. Therefore, filing of cost audit report for the FY 2023-24 is not applicable to the Company. However, as required under Section 148(1) of the Companies Act, 2013, Company has maintained necessary Cost Records.

CORPORATE GOVERNANCE &

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

As per Regulation 34 of SEBI (LODR) Regulations, 2015, a separate section on corporate governance practices followed by the Company, as well as "Management Discussion and Analysis Report” confirming compliance, is set out in the Annexure forming an integral part of this Report. A certificate from Practicing Company Secretary regarding compliance with corporate governance norms stipulated in Regulation 34 of SEBI (LODR) Regulations, 2015 is annexed to the report on Corporate Governance.

In compliance with one of the Corporate Governance requirements as per Regulation 34 read with Schedule V of the SEBI (LODR) Regulations, 2015, the Company has formulated and implemented a Code of Conduct for all Board members and senior management personnel of the Company, who have affirmed compliance thereto.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

Information of conservation of energy, technology absorption and foreign exchange earnings and outgo as required under Section 134(3)(m) of the Companies Act, 2013 read with rule 8 of the Companies (Accounts) Rules, 2014, is given in the Annexure E and forms part of this Report.

CORPORATE SOCIAL RESPONSIBILITY

As a part of Corporate Social Responsibility (CSR), the Company continued extending help towards social and economic development of the villages and the communities located close to its operations and also providing assistance to improving their quality of life. Company’s intention is to ensure that we meet the development needs of the local community. CSR is not just a duty; it is an approach towards existence. The Company see CSR as a creative opportunity to fundamentally strengthen the Company’s business, while contributing to the society and creating social, environmental and economic impact. The Company’s motto is to build a sustainable life for the weaker and under-privileged sections of the Society.

The Company has constituted CSR Committee and has framed a CSR Policy. The brief details of CSR Committee is provided in the report on Corporate Governance. The details of contents of CSR Policy and CSR activities carried out by the Company are appended in the Annexure F to the Director's Report. The CSR Policy is available on the website of the Company at - www. imdcal.com.

(URL: https://imdcal.com/images/files/Investor-

Relations/Policies%20of%20Dishman%20 Carbogen%20Amcis%20Limited/Corporate%20 Social%20Responsibilitv%20Policv.pdf

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

In accordance with Regulation 34(2) (f) of the Listing Regulations, the Business Responsibility and Sustainability Report ('BRSR') forms part of this Annual Report. BRSR describes initiatives undertaken by the Company from an environmental, social and governance perspective. Further, SEBI vide its circular no. S E BI/H O/C F D/C F D-S EC-2/P/CIR/2023/122 dated 12^th July, 2023, updated the format of BRSR to incorporate BRSR core, a subset of BRSR, indicating specific Key Performance Indicators (KPIs) under nine ESG attributes, which are subject to mandatory reasonable assurance by an independent assurance provider. In accordance with this requirement, the said assurance is not applicable to the Company.

A separate report on Business Responsibility and Sustainability Report is annexed herewith as Annexure G.

DIVIDEND DISTRIBUTION POLICY

As per Regulation 43A of SEBI (LODR) Regulations, 2015, top 1000 companies based on market capitalization (calculated as on 31^st March of every financial year) are required to formulate Dividend Distribution Policy. In this regard, the Board has approved the Dividend Distribution Policy in line with said Regulation. The said policy is available on website of the Company and can be accessed at https://imdcal.com/images/ files/Investor-Relations/Policies%20of%20Dishman%20 Carbogen%20Amcis%20Limited/Dividend%20 Distribution%20Policy.pdf.

ACKNOWLEDGEMENT

Your Directors would like to express their appreciation for the assistance and co-operation received from foreign institutions, banks, associates, Government authorities, customers, supplier, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services and teamwork by the executives, staff members and workers of the Company for enthusiastic contribution to the growth of Company's business.

For and on behalf of the Board of Directors Janmejay R. Vyas

Date: 30^th May, 2024 Chairman

Place: Ahmedabad DIN - 00004730