About J B Chemicals & Pharmaceuticals Ltd

J B Chemicals & Pharmaceuticals (JBC) was originally promoted and incorporated in Maharashtra by J B Mody as J B Mody Chemicals & Pharmaceuticals in December 18th, 1976. The Company is engaged in the business of manufacturing and marketing of diverse range of pharmaceuticals formulations, herbal remedies and APIs. The company has manufacturing units at Thane, Belapur, Ankleshwar, Panoli and Daman. The bulk drug plant at Panoli and formulation plant at Daman became operational in Apr.'95. Products like metrogyl, rantac (a ranitidine-based formulation), and nicardia (a cardiac care medicine) form a significant part of the company's sales. JBC has its subsidiaries namely Lekar Healthcare Ltd and J.B Life Science Overseas Ltd. JBC had a tie-up with Justesa Imagen, Spain, to manufacture and market radio diagnostics under the Trazograf brand name. JBC has also diversified into high-growth agro-based products by acquiring McDa Agro (MAL). The products manufactured by MAL complement fertilisers and increase crop productivity. It has entered into a MoU with GNFC to distribute these products locally. The pharmaceutical divisions of Ifiunik Pharmaceuticals and Unique Pharmaceutical Laboratories has been merged into the company with effect from April 2000. Unique Chemicals (A Division of the company) manufacturing and marketing Bulk Drugs has been awarded Certificate of Suitability to Europeon Pharmacopoeia Monograph for Nifedipine EP from Europeon Directorate for the Quality Medicines. In Feb. 2002 the company has achieved another break through in its major R & D Activity - Invention biologically active molecules - New Chemical Entity. In 2001-02 the company introduced 3 products Reducin XX and two in the Cholesterol reducing segment i.e., Ifistatin and Vasolip. The company has launched five new products during the year 2003-04 in the global markets to widen its product portfolio. During 2004-05, the company launched new products Cephalosporins, Moviz and its expansion Movi 3D and a nueropsychiatry product through Zephyr for the first time. A 100% EOU manufacturing facility at Panoli for production of Gel, Ointment was commissioned during 2001-02 at a cost of Rs.21 crores and the same was financed through internal accruals. To manufacture 'DOKTOR MOM' lozenges the company is setting up two manufacturing units at Daman at a capital outlay of Rs.28 crores, which is to be financed through internal accruals. The commercial production of the Doktor Mom lozenges at its 100% Export Oriented Unit, started from 1 Sep. 2003 and tablets from 1, Jan. 2004 in Daman.Doktor Mom', the company's brand,was adjudged the Most Trusted European Brand by Reader's Digest in the cold and cough segment for the fourth consecutive year in 2003-04. During 2004-05, the company received approval for its pharmaceutical manufacturing unit from TGA (Australia). During 2004-05, the company plants were approved by US-FDA, TGA-Australia, EDQM, MCC-South Africa, INVIMA (Colombia) and MHRA (UK). During 2004-05, the company is setting up a new facility conforming to international standards in Panoli (Gujarat) to manufacture contrast media products by June 2006. During 2004-05, the company has planned to set up a wholly owned subsidiary in Moscow, Russia, called 'Unique Pharmaceuticals Laboratories' with the initial investment of $ 3 million. During 2005, the company entered into two agreements, one with Pharma-a-Care Pharmaceuticals Pte. Ltd., in Australia to develop its niche products in Australian market and another with Ranbaxy Laboratories to enter in the Romanian market. The company has subdivided the value of the share from Rs.10/- per share to Rs.2/- per share with effective from 05, April 2005. During 2005-2006, the company has proposed to amalgamate its wholly owned subsidiary viz. lekar healthcare ltd with itself. The company has fixed April 1, 2006 as the appointed date. During the year 2015, J.B. Chemicals & Pharmaceuticals Private Limited, Singapore, ceased to be the company's subsidiary consequent to its dissolution. The Scheme of Amalgamation and Arrangement between Jyotindra Mody Holdings Private Limited and Ansuya Mody Securities Private Limited and Dinesh Mody Securities Private Limited and Kumud Mody Securities Private Limited and Shirish B. Mody Investments Private Limited and Bharati S. Mody Investments Private Limited (Transferor Companies) and J. B. Chemicals & Pharmaceuticals Limited (Transferee Company) and their respective shareholders under Sections 391 to 394 read with Sections 100 to 103 of the Companies Act, 1956 and Section 55 of the Companies Act, 2013 and any other applicable provisions of the Companies Act, 1956 and the Companies Act, 2013, which was approved by the Board on 15 April 2014 and members of the company at Court Convened Meeting held on 14 October 2014 and public shareholders through postal ballot and e-voting on 16 October 2014, was sanctioned by the Hon'ble Bombay High Court on 27 February 2015. The Scheme has become effective on 13 April 2015 with appointed date of 1 April 2014. Accordingly, the Transferor Companies stand merged with the company and the merger has been given effect to in the financial statements of the company for the year ended on March 31, 2015. Consequently, 4,33,42,270 equity shares of FY Rs. 2 held by the Transferor Companies in the company have been cancelled and the company has allotted 4,33,42,270 equity shares of Rs. 2 each credited as fully paid up to the shareholders of the Transferor Companies in accordance with the fair share entitlement ratio specified in the Scheme. During the year 2016, the Company's subsidiary Unique Pharmaceutical Laboratories FZE (UPL FZE) acquired 2, 194,030 Ordinary Shares in Biotech Laboratories (Pty.) Ltd. from Afrika Biopharma Investments (Pty). Ltd. Consequent to restructuring of existing 49% shareholding in Biotech and issue of certain shares by Biotech after the aforesaid acquisition, UPL FZE now holds 95.24% voting capital of Biotech. Accordingly, Biotech has become subsidiary of the Company. Subsequently, the Company's subsidiary J.B. Healthcare Pvt. Ltd., Jersey, has been dissolved. With a view to return surplus cash and pursuant to authority conferred under the Articles of Association of the Company, the Board approved buy-back of fully paid up equity shares of face value of Rs 2 by the Company up to 12,50,000 equity shares at a price of Rs 400 per equity share for a total consideration not exceeding Rs 5,000 lakhs (buy-back amount) excluding transaction costs, on proportionate basis through tender offer. The number of equity shares authorized for buy-back represents 1.47% of the total outstanding equity shares, while the buy-back amount represents 3.85% of the equity share capital and free reserves as at March 31, 2017. This buy-back will be implemented in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998. The Company completed on 25 July 2017 buy-back of 1,250,000 equity shares of face of Rs. 2 at price of Rs. 400 per share on proportionate basis through tender offer in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998. Consequently, the paid-up equity share capital stands reduced to 83,569,975 equity shares of Rs. 2. The Company has transferred the sum of Rs. 25 lakhs from general reserves to capital redemption reserve account pursuant to Section 69 of the Companies Act, 2013. The Company launched four new products in dermatology, amoebicide and probiotic segments during the year 2018. The Company completed on 1st November 2018 buy-back of 3,333,333 equity shares of face value of Rs 2 at price of Rs 390 per share on proportionate basis through tender offer in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998. Consequently, the paid-up equity share capital stands reduced to 80,236,642 equity shares of Rs 2. The Company has transferred the sum of Rs 66.67 lakhs from general reserve to capital redemption reserve account pursuant to Section 69 of the Companies Act, 2013. The Company launched six new products during the year 2020 across Cardiac and Gastrointestinal (GI) segments. On 2nd July, 2020, a Share Purchase Agreement was signed between founder, Mody Family members and Tau Investment Holdings Pte. Ltd., Singapore, an affiliate of global private equity firm KKR, where Tau Investment Holdings Pte. Ltd. acquired controlling stake of 41,731,363 (54%) equity shares of Rs. 2 each in the Company (JB Chemcials Pharmaceuticals Limited) from Mody Family members. Following execution of the above referred Share Purchase Agreement to acquire shares in and control over the Company, Tau Investment Holdings Pte. Ltd. and persons acting in concert made an open offer for acquiring 26% stake from public shareholders of the Company. In FY 2021, the Company introduced newer therapeutic categories for Diabetes, Nephrology, Respiratory and Virology. It launched 10 new products across angiotensin receptor blocker, anti-diabetic, calcium channel blocker, hypotensive, anti-peptic ulcerant, anti-viral and anti-parasitic segments. During the year 2022-23, the Company launched 17 new products in FY233 in the field of Gastro Intestinal, Gynaecology, Respiratory and Anti Diabetes. It acquired the Azmarda' brand from Novartis, a niche Paediatric portfolio from Dr Reddy and the Razel' franchise from Glenmark.

J B Chemicals & Pharmaceuticals Ltd Chairman Speech

Dear Shareholders,

It has been an eventful year for the entire world. COVID-19 impacted every single person on the planet. However, I must say that everyone around the world stood united in this fight against this deadly virus, and we have managed to control the virus and its spread. Pandemic always poses different types of challenges. And now, as we emerge out of this pandemic, we can also see a different side of the universe being unfolded.

In this background, I am pleased with the legacy we are creating at JB, with a strong growth orientation approach built on the values of integrity, trust, and reliability. During the year, we retained our position as the fastest growing company within the top 30 pharma companies in India. Our big brands are growing bigger. Five of our brands feature within the top 300 in the industry, and quite a few of these are household names. These too have stood out in their respective molecule segments.

We have the required determination and discipline to succeed in a post-pandemic era. Team-mates across the organization have gone above and beyond to secure a strong future for the company, and I wish to compliment all of them. Underlining our achievements and aspirations, we have assumed a new identity of JB Pharma to our customers, vendors, and partners. We wish to be future-ready and poised for growth, and this will happen through investment in advancing our portfolio in leadership as well as novel segments, smart marketing strategies in select export markets and driving home better productivities.

• New Go-To-Market Model: We launched a new Go-To-Market model which has helped us increase productivity and bring greater focus to the domestic business.

• Increased Focus on the Chronic Segment:

During the year, we entered the fast growing chronic segment like heart failure, diabetes, and nephrology. Our acquisition of the 'Azmarda' brand from Novartis, will also be instrumental in driving a higher share of the chronic business.

• New Product Launches: During the year, we launched over 15 new products. Correspondingly the share of new offerings to domestic sales has increased from 1.4% in FY21 to 4% in FY22, and we are eager to push this metric even further.

• Acquisition-led Growth via Strong Franchises:

While we are driving our organic strategies, the business is open to value-creating opportunities. The two acquisitions underline the prudent utilization of our capital and our free cash flows. Sporlac marks our foray into the highly attractive probiotics segment. The acquisition of the brand Azmarda from Novartis marks our entry into one of the fastest growing segments within cardiology, i.e. heart failure.

Our well-scripted progress in the international business continues: Beyond India, we count South Africa and Russia as home markets. Ours is the fastest growing company in South Africa, where we are ranked #15 in the market. In Russia, given the geo-political instability that the region has seen, we have been cautious in the management of the operations, although the demand has stayed on trend.

Further, our products are available across 40 countries, referred to as the ROW region. We operate through a distributor-led model, and we see demand picking up for the region post the pandemic. In the US, the focus shall be on low volume but high value offerings with a niche peer profile and where we are backed up with our in-house APIs. The US will continue to remain a cost-plus business model, which ensures our returns are good from the business.

The CMO business, especially Lozenges, represents an area of excellence for us, with a top 5 global position in the production of medical and herbal lozenges. Backed by key regulatory citations and approvals in markets such as the UK, Canada, EU, Australia, South Africa, Russia/CIS, and other markets, our offerings form part of the global portfolios of leading multinational pharma/consumer health companies. We endeavor to achieve closer cooperation with our key customers, and given a comfortable availability of capacities, we are seeking to scale up progressively. The future portfolio will cater to immunity-focused products beyond the norm of cough, cold, and flu. Given our thrust on ROCE and good operating margins, we are keen to grow this business further.

FY22 is been a continuation of our journey to consolidate our foundation and prepare for sustained growth. On the one hand, we have taken measures to drive up therapy-wise and brand-focused expansion, especially within the domestic arena and on the other we are creating differentiation through sizeable opportunities within Lozenges. This journey will get augmented with opportune investments in growth creating acquisitions. On the operational aspect, we will continue the journey towards higher productivity and better cost management while enhancing our offering profile amongst key customers. All of this is and shall be possible on the back of a robust organization backbone and healthy governance platform that we are investing in.

Very recently, we have unveiled our new identity, which is a representation of our aspirations. Our new identity has a simple, solid look that reflects the way we think and conduct ourselves. It is a symbol of our belief in continuing to be GOOD PEOPLE FOR GOOD HEALTH. Thereby, with a defined growth agenda, team spirit, and dedication to creating sustainable advantages through key products, we are approaching the new year with new vigor and purpose.

I thank you for your support, and we will continue to create value for all our shareholders.

J B Chemicals & Pharmaceuticals Ltd Company History

J B Chemicals & Pharmaceuticals (JBC) was originally promoted and incorporated in Maharashtra by J B Mody as J B Mody Chemicals & Pharmaceuticals in December 18th, 1976. The Company is engaged in the business of manufacturing and marketing of diverse range of pharmaceuticals formulations, herbal remedies and APIs. The company has manufacturing units at Thane, Belapur, Ankleshwar, Panoli and Daman. The bulk drug plant at Panoli and formulation plant at Daman became operational in Apr.'95. Products like metrogyl, rantac (a ranitidine-based formulation), and nicardia (a cardiac care medicine) form a significant part of the company's sales. JBC has its subsidiaries namely Lekar Healthcare Ltd and J.B Life Science Overseas Ltd. JBC had a tie-up with Justesa Imagen, Spain, to manufacture and market radio diagnostics under the Trazograf brand name. JBC has also diversified into high-growth agro-based products by acquiring McDa Agro (MAL). The products manufactured by MAL complement fertilisers and increase crop productivity. It has entered into a MoU with GNFC to distribute these products locally. The pharmaceutical divisions of Ifiunik Pharmaceuticals and Unique Pharmaceutical Laboratories has been merged into the company with effect from April 2000. Unique Chemicals (A Division of the company) manufacturing and marketing Bulk Drugs has been awarded Certificate of Suitability to Europeon Pharmacopoeia Monograph for Nifedipine EP from Europeon Directorate for the Quality Medicines. In Feb. 2002 the company has achieved another break through in its major R & D Activity - Invention biologically active molecules - New Chemical Entity. In 2001-02 the company introduced 3 products Reducin XX and two in the Cholesterol reducing segment i.e., Ifistatin and Vasolip. The company has launched five new products during the year 2003-04 in the global markets to widen its product portfolio. During 2004-05, the company launched new products Cephalosporins, Moviz and its expansion Movi 3D and a nueropsychiatry product through Zephyr for the first time. A 100% EOU manufacturing facility at Panoli for production of Gel, Ointment was commissioned during 2001-02 at a cost of Rs.21 crores and the same was financed through internal accruals. To manufacture 'DOKTOR MOM' lozenges the company is setting up two manufacturing units at Daman at a capital outlay of Rs.28 crores, which is to be financed through internal accruals. The commercial production of the Doktor Mom lozenges at its 100% Export Oriented Unit, started from 1 Sep. 2003 and tablets from 1, Jan. 2004 in Daman.Doktor Mom', the company's brand,was adjudged the Most Trusted European Brand by Reader's Digest in the cold and cough segment for the fourth consecutive year in 2003-04. During 2004-05, the company received approval for its pharmaceutical manufacturing unit from TGA (Australia). During 2004-05, the company plants were approved by US-FDA, TGA-Australia, EDQM, MCC-South Africa, INVIMA (Colombia) and MHRA (UK). During 2004-05, the company is setting up a new facility conforming to international standards in Panoli (Gujarat) to manufacture contrast media products by June 2006. During 2004-05, the company has planned to set up a wholly owned subsidiary in Moscow, Russia, called 'Unique Pharmaceuticals Laboratories' with the initial investment of $ 3 million. During 2005, the company entered into two agreements, one with Pharma-a-Care Pharmaceuticals Pte. Ltd., in Australia to develop its niche products in Australian market and another with Ranbaxy Laboratories to enter in the Romanian market. The company has subdivided the value of the share from Rs.10/- per share to Rs.2/- per share with effective from 05, April 2005. During 2005-2006, the company has proposed to amalgamate its wholly owned subsidiary viz. lekar healthcare ltd with itself. The company has fixed April 1, 2006 as the appointed date. During the year 2015, J.B. Chemicals & Pharmaceuticals Private Limited, Singapore, ceased to be the company's subsidiary consequent to its dissolution. The Scheme of Amalgamation and Arrangement between Jyotindra Mody Holdings Private Limited and Ansuya Mody Securities Private Limited and Dinesh Mody Securities Private Limited and Kumud Mody Securities Private Limited and Shirish B. Mody Investments Private Limited and Bharati S. Mody Investments Private Limited (Transferor Companies) and J. B. Chemicals & Pharmaceuticals Limited (Transferee Company) and their respective shareholders under Sections 391 to 394 read with Sections 100 to 103 of the Companies Act, 1956 and Section 55 of the Companies Act, 2013 and any other applicable provisions of the Companies Act, 1956 and the Companies Act, 2013, which was approved by the Board on 15 April 2014 and members of the company at Court Convened Meeting held on 14 October 2014 and public shareholders through postal ballot and e-voting on 16 October 2014, was sanctioned by the Hon'ble Bombay High Court on 27 February 2015. The Scheme has become effective on 13 April 2015 with appointed date of 1 April 2014. Accordingly, the Transferor Companies stand merged with the company and the merger has been given effect to in the financial statements of the company for the year ended on March 31, 2015. Consequently, 4,33,42,270 equity shares of FY Rs. 2 held by the Transferor Companies in the company have been cancelled and the company has allotted 4,33,42,270 equity shares of Rs. 2 each credited as fully paid up to the shareholders of the Transferor Companies in accordance with the fair share entitlement ratio specified in the Scheme. During the year 2016, the Company's subsidiary Unique Pharmaceutical Laboratories FZE (UPL FZE) acquired 2, 194,030 Ordinary Shares in Biotech Laboratories (Pty.) Ltd. from Afrika Biopharma Investments (Pty). Ltd. Consequent to restructuring of existing 49% shareholding in Biotech and issue of certain shares by Biotech after the aforesaid acquisition, UPL FZE now holds 95.24% voting capital of Biotech. Accordingly, Biotech has become subsidiary of the Company. Subsequently, the Company's subsidiary J.B. Healthcare Pvt. Ltd., Jersey, has been dissolved. With a view to return surplus cash and pursuant to authority conferred under the Articles of Association of the Company, the Board approved buy-back of fully paid up equity shares of face value of Rs 2 by the Company up to 12,50,000 equity shares at a price of Rs 400 per equity share for a total consideration not exceeding Rs 5,000 lakhs (buy-back amount) excluding transaction costs, on proportionate basis through tender offer. The number of equity shares authorized for buy-back represents 1.47% of the total outstanding equity shares, while the buy-back amount represents 3.85% of the equity share capital and free reserves as at March 31, 2017. This buy-back will be implemented in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998. The Company completed on 25 July 2017 buy-back of 1,250,000 equity shares of face of Rs. 2 at price of Rs. 400 per share on proportionate basis through tender offer in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998. Consequently, the paid-up equity share capital stands reduced to 83,569,975 equity shares of Rs. 2. The Company has transferred the sum of Rs. 25 lakhs from general reserves to capital redemption reserve account pursuant to Section 69 of the Companies Act, 2013. The Company launched four new products in dermatology, amoebicide and probiotic segments during the year 2018. The Company completed on 1st November 2018 buy-back of 3,333,333 equity shares of face value of Rs 2 at price of Rs 390 per share on proportionate basis through tender offer in accordance with provisions of the Companies Act, 2013 and Securities and Exchange Board of India (Buy-back of Securities) Regulations, 1998. Consequently, the paid-up equity share capital stands reduced to 80,236,642 equity shares of Rs 2. The Company has transferred the sum of Rs 66.67 lakhs from general reserve to capital redemption reserve account pursuant to Section 69 of the Companies Act, 2013. The Company launched six new products during the year 2020 across Cardiac and Gastrointestinal (GI) segments. On 2nd July, 2020, a Share Purchase Agreement was signed between founder, Mody Family members and Tau Investment Holdings Pte. Ltd., Singapore, an affiliate of global private equity firm KKR, where Tau Investment Holdings Pte. Ltd. acquired controlling stake of 41,731,363 (54%) equity shares of Rs. 2 each in the Company (JB Chemcials Pharmaceuticals Limited) from Mody Family members. Following execution of the above referred Share Purchase Agreement to acquire shares in and control over the Company, Tau Investment Holdings Pte. Ltd. and persons acting in concert made an open offer for acquiring 26% stake from public shareholders of the Company. In FY 2021, the Company introduced newer therapeutic categories for Diabetes, Nephrology, Respiratory and Virology. It launched 10 new products across angiotensin receptor blocker, anti-diabetic, calcium channel blocker, hypotensive, anti-peptic ulcerant, anti-viral and anti-parasitic segments. During the year 2022-23, the Company launched 17 new products in FY233 in the field of Gastro Intestinal, Gynaecology, Respiratory and Anti Diabetes. It acquired the Azmarda' brand from Novartis, a niche Paediatric portfolio from Dr Reddy and the Razel' franchise from Glenmark.

J B Chemicals & Pharmaceuticals Ltd Directors Reports

Your directors are pleased to present forty-seventh report and audited financial statements of the Company for the financial year ended on March 31, 2023.

1. FINANCIAL HIGHLIGHTS

The following are the highlights of financial performance of the Company during the year under review.

(' in lakhs)

2. DIVIDEND

Your directors recommend a final dividend of ' 9.25 (462.50%) per equity share of face value of ' 2, payment whereof will be subject to deduction of tax at source. During the year, Board of Directors declared interim dividend of ' 8.50 (425%) per equity share, which was paid on March 1, 2023. The final dividend, if declared, together with interim dividend already paid would result in total outgo of ' 13,737 lakhs. The Board has not proposed any transfer out of profit for the financial year to reserves in relation to these dividend payments. The Company paid interim dividend of ' 8.50 (425%) and final dividend of ' 8 (400%) per equity share in the previous year.

3. OPERATIONS/STATE OF AFFAIRS

The Company's strong performance and sales momentum continued throughout the year, with the Company achieving ' 3,000 crores milestone in terms of revenue. Revenue stood

at ' 314,928 lakhs as compared to ' 242,424 lakhs registering a growth of 30%. The domestic business continued its strong performance growing at 38% driven by organic and inorganic growth while the international business recorded a growth of 22%.

Total standalone revenue during the year at ' 288,416 lakhs was 32% higher over the previous year.

Domestic formulations business revenue was at ' 163,965 lakhs as compared to ' 118,827 lakhs for the previous financial year registering a growth of 38%. The business continued to retain its position as the fastest growing company in Indian Pharmaceuticals Market amongst the top 25. This outperformance is mainly attributed to factors such as - the 5 pillar brands driving market-beating growth, increasing contribution from Chronic Therapies, improved field-force productivity, acceleration in new launches and acquisitions. Consequently, we witnessed further rank improvement in our IPM ranking to 24. As per IQVIA MAT March'23 data, the Company grew at 22% vs market growth of 8%.

Its main brands continued their market-beating performance and remained well above market growth rates. The Company now has 6 brands in the IQVIA top 300 brands list with Azmarda being the new entrant ranking at 261.

The international business revenue (including API) was ' 150,963 lakhs for FY23 vs ' 123,597 lakhs for FY22 recording a growth of 22%. International business delivered a good performance against the odds of challenging and volatile market. The CMO business grew at 60% to record ' 40,578 lakhs of revenue in the financial year. Exports formulation business revenue stood at ' 101,026 lakhs growing at 13% over the previous year with both Russia and South Africa business registering growth. The API sales at ' 9,359 lakhs achieved a growth of ~3% over the previous year.

The cost environment continued to remain challenging but started to stabilised by the second half of the year. Raw materials costs and packing materials costs remained at elevated levels throughout the year. Logistics costs tapered down in the second half of the financial year. High inflationary environment and lower Azmarda margins, impacted the overall gross margins. However, towards the fourth quarter we could see some normalisation of gross margins. Reported EBIDTA was ' 69,575 lakhs (previous year ' 54,346 lakhs). Operating EBIDTA (after adjusting non-cash ESOP costs) was ' 76,513 lakhs (previous year ' 60,611 lakhs).

Profit Before Tax was at ' 55,523 lakhs as compared to ' 50,490 lakhs, growing at 10%. Profit After Tax was at ' 41,001 lakhs as compared to ' 38,604 lakhs. PAT and PBT growth was impacted due to higher finance costs, depreciation and lower treasury income.

4. ACQUISITIONS

During the year, the Company made three acquisitions starting with the acquisition of the brand Azmarda (Sacubitril-Valsartan) which expanded Company's cardiac portfolio to now include heart failure. Sacubitril-Valsartan is one of the fastest growing molecules in the cardiology segment for the last few years and Azmarda has a sizeable market share in the segment. The second acquisition was the pediatric portfolio which included 4 brands: Z&D, Pecef, Pedicloryl and Ezinapi, all of which complement JB Pharma's existing pedia portfolio. These brands have helped the Pedia division leverage its Go-to-Market strategy and strengthened its positioning in the overall gut health for children. The latest acquisition was the Rosuvastatin brand Razel and its other combinations. Razel is the 10th largest brand in the Rosuvastatin molecule category (as per IQVIA MAT Oct'22 data). This acquisition ensures JB Pharma's presence in the largest category of cardiology i.e. statins while further complementing its strong cardiology portfolio.

5. RESPONSIBILITY STATEMENT

The Directors confirm:

(i) that in the preparation of the annual accounts for the year under review, the applicable accounting standards have been followed;

(ii) that they have selected appropriate accounting policies and applied them consistently and made judgements 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 financial year 2022-23 and of profit of the Company for that year;

(iii) that they 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;

(iv) that they have prepared the annual accounts for the year ended on March 31, 2023 on a going concern basis;

(v) that they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

(vi) that they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

6. SUBSIDIARIES

The highlights of performance of the subsidiary companies in Rupee terms for the year 2022-23 is presented in Schedule-A. After inter-company adjustments, subsidiary companies contributed ' 26,512 lakhs to consolidated revenue and ' 2,819 lakhs to consolidated profit before tax of the Company.

Revenues for Biotech Laboratories (Pty.) Ltd., South Africa, for the financial year 2022-23 were Rand 647.64 million, which represents growth of 12.31% over the previous year, while its operating profit and profit after tax at Rand 47.54 million and Rand 37.13 million were 22.65% and 30.17% higher over the previous year respectively. Sales of LLC Unique Pharmaceutical Laboratories, Russia, for the financial year 2022-23, at Rouble 794.39 million were 8.14% higher over the previous year, while it incurred net loss of Rouble 2.58 million against profit of Rouble 26.96 million in the previous year. Unique Pharmaceutical Laboratories FZE, Dubai is presently not engaged in any business activity and incurred loss of AED 0.71 million due to operating and other expenses.

7. CORPORATE GOvERNANCE And Compliances

A certificate from practising company secretary on compliance with conditions of corporate governance is annexed to this Board's report. Management Discussion and Analysis Report, Compliance report on Corporate Governance, Business Responsibility and Sustainability Report and Dividend Distribution Policy form part of this annual report.

8. public deposits

The Company has not accepted any deposit covered under Chapter V of the Companies Act, 2013 during the year. All the public deposits accepted prior to the commencement of the said Act have been repaid in 2014-15.

9. DIRECTORS AND KEY MANAGERIAL PERSONNEL

The members of the Company at annual general meeting held on August 24, 2022 re-appointed Mr. Prashant Kumar, who was retiring by rotation.

In accordance with provisions of the Companies Act, 2013, Mr. Gaurav Trehan would retire by rotation at the ensuing annual general meeting. Being eligible, he has offered himself for re-appointment.

In the opinion of the Board of Directors, Mr. Ranjit Shahani, Mr. Sumit Bose and Ms. Padmini Khare Kaicker, independent directors, are persons of integrity and they all possess relevant expertise and experience necessary for effective functioning of the Company. These independent directors have given declarations to the Board that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 as well as in Regulation 16 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. They have also confirmed that they have registered with the Indian Institute of Corporate Affairs to include their names in the databank of independent directors. However, in terms of Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, these independent directors are not required to pass an online proficiency self-assessment test conducted by the said Institute notified under sub-section (1) of section 150 of the Companies Act, 2013.

Nine meetings of the Board of Directors were held during the financial year ended on March 31, 2023. These meetings were held on April 1, 2022, May 26, 2022, June 29, 2022, July 22, 2022, August 4, 2022, November 11, 2022, December 13, 2022, February 8, 2023 and March 29, 2023.

10. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION

The Company's policy on directors' appointment is set out in Schedule-B. The salient features of the Company's policy on remuneration for the directors, key managerial personnel and other employees is set out in Schedule-C. The said Policy including criteria for determining qualifications, positive attributes and independence of a director has been posted on the Company's website www.jbpharma.com.

11. conservation of energy, technology

ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 are given in Schedule-D.

12. CORPORATE SOCIAL Responsibility

Corporate Social Responsibility (CSR) Committee of the Board consists of Mr. Ranjit Shahani, Mr. Sumit Bose, Mr. Nikhil Chopra

and Mr. Prashant Kumar. The salient features of the CSR Policy of the Company and the annual report on CSR in the prescribed form are set out in Schedule-E. The CSR Policy and annual report on CSR are posted on the Company's website www.jbpharma.com.

The Company spent ' 819.36 lakhs on CSR activities (' 779.36 lakhs on CSR activities and ' 40.00 lakhs on administrative overheads for general management and administration of CSR function) during financial year 2022-23 as against obligation of ' 815.10 lakhs being 2% of the average net profits of the Company made during three immediately preceding financial years.

13. AUDIT Committee AND viGILANCE Mechanism

The Board has constituted Audit Committee that consists of Ms. Padmini Khare Kaicker, Chairperson, Mr. Ranjit Shahani, Mr. Sumit Bose and Mr. Prashant Kumar. There has been no instance of non-acceptance of recommendation of Audit Committee by the Board.

The Board of Directors has adopted revised vigil mechanism in the form of Whistle Blower Policy to enable directors, employees and other stakeholders to make Protected Disclosures (as defined in the Policy) in relation to Alleged Wrongful Conduct (as defined in the Policy) to the Redressal Committee for evaluation and investigation in consultation with the Audit Committee. The Company has posted the Whistle Blower Policy and the associated Complaint Response Plan Policy on its website www.jbpharma.com.

14. ANNUAL PERFORMACE EvALUATION

The Board of Directors carried out formal annual evaluation of performance of the Board, its Committees and individual directors during 2022-23 in accordance with the manner specified by the Nomination and Remuneration Committee (NRC) and using evaluation criteria recommended by the NRC and approved by the Board. The performance evaluation was carried out in the following manner, being manner recommended by the NRC.

Evaluation of performance of the Board: Members of the Board evaluated the Board on the given criteria on scale of 1 to 4 (4 being highest). The aggregate of simple average of rating assigned by each Board member was further averaged to ascertain Board's performance.

Evaluation of performance of the Board Committees: Members of the concerned committee evaluated performance of the committee on the given criteria on scale of 1 to 4. Aggregate of simple average of rating assigned by members was further averaged to ascertain performance of the concerned committee.

Evaluation of performance of Individual Director: Board members (excluding director being evaluated) evaluated performance of all other Board members on the given criteria on scale of 1 to 4. Aggregate of simple average of rating assigned to each Board member was further averaged to ascertain performance of such director.

15. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

Form AOC-2 prescribed under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014 provides for disclosure of (a) details of contracts or arrangements or transactions not at arm's length basis, and (b) details of material contracts or arrangement or transactions at arm's length basis.

All the transactions entered into by the Company with the related parties during the year were pursuant to the contract or arrangement approved by the Audit Committee and the Board of Directors. The transactions so entered into were in the ordinary course of business of the Company and on arm's length basis. The contract or arrangement or transactions were neither material in terms of the Policy on materiality of related party transactions adopted by the Company nor it exceeded the threshold limit prescribed pursuant to first proviso to Section 188(1) of the Companies Act, 2013. Accordingly, the disclosure of related party transactions in Form AOC-2 is not applicable. However, disclosure on related party transactions as per IND AS-24 has been provided under Note No. 45 of the standalone financial statements and Note No. 43 of the consolidated financial statements.

16. PARTICULARS OF EMPLOYEES AND OTHER REMUNERATION Related DISdOSURES

The remuneration related and other disclosure required in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, are given in Schedule-F.

A statement showing name and other particulars of the employees in terms of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is given in Schedule-G.

17. employee stock option scheme

"JBCPL Employee Stock Option Scheme 2021" ("Scheme") was approved by the shareholders on July 31,2021. The Compensation Committee of the Board administers the Scheme and granted time based options and performance based options to eligible employees and director(s) of the Company and its subsidiary companies with a view to achieve overall growth objective. The Scheme is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (under the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021) and there has been no change in the Scheme since the shareholders' approval date.

Disclosure of details of the Scheme as required under (a) Regulation 14 of the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are posted on the Company's website www.jbpharma.com and web link thereto is https://jbpharma.

com/download/esop-disclosure-for-the-year-ended-31-03- 2023/?wpdmdl=7953&refresh=6493e84a349c41687414858 and (b) the Companies (Share Capital and Debentures) Rules, 2014, is set out in Schedule-H to this report.

18. RISK MANAGEMENT

The Board of Directors has developed and implemented risk management policy for the Company. Pursuant to the Listing Regulations, the Board has constituted Risk Management Committee and delegated monitoring and review of the risk management plan to the Committee. Committee periodically reviews the status of mitigation measures taken in respect of risk management plan and reports the progress thereof and new risks identified to the Board and Audit Committee. Board at present does not perceive any element of risk, which may threaten existence of the Company.

19. INTERNAL FINANCIAL CONTROLS

The Board has adopted internal financial controls encompassing policies and procedures for ensuring orderly and efficient conduct of business, including adherence to Company's policies, safeguarding the Company's assets, prevention and detection of fraud and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. The specific internal financial controls with reference to financial statements include internal audit of important activities and processes relating to preparation of financial statements, adoption of well-defined standard operating procedure for business transactions and compliance relating thereto, use of ERP for accuracy and control, review of periodically prepared financial statements with an objective to ensure that financial statements present true and fair view and are sufficient/credible and in compliance with legal and regulatory requirements. The Board has appointed Ernst & Young LLP as internal auditor to periodically audit systems and controls in all key areas of operations to ascertain effective functioning of internal controls including internal financial controls. In the opinion of the Board, the Company has adequate internal controls with reference to the financial statements.

Neither management of the Company has come across any instance of fraud during the year 2022-23 nor the auditors of the Company have reported any such instance to the Audit Committee.

20. LOANS, GUARANTEES AND INvESTMENTS

During the year, the Company has not given any loan or made any investment attracting the provisions of Section 186 of the Companies Act, 2013. The particulars of guarantees given pursuant to Section 134(3)(g) of the Companies Act, 2013 during the year and outstanding as at the year-end are given in Annexure-I.

21. COST RECORDS

The Company is required to maintain cost records as specified by the Central Government under sub-section (1) of Section 148

of the Companies Act, 2013, and such accounts and records are duly made and maintained by the Company. The Company is further required to get such cost records audited by a cost auditor in accordance with the Companies (Cost Records and Audit) Rules, 2014 and furnish cost audit report received from the cost auditor to the Central Government within the prescribed time. The Company is in compliance with these provisions.

22. SECRETARIAL AUDIT REPORT

Ashish Bhatt & Associates, Practising Company Secretaries, Secretarial Auditor of the Company, carried out secretarial audit for the financial year 2022-23 as provided under Section 204 of the Companies Act, 2013 and rules made there under. The secretarial audit report given by the said auditor is annexed to this report as Schedule-J.

23. AUDITORS

The members at annual general meeting held on September 9, 2021 has appointed Deloitte Haskins & Sells LLP, (having firm registration no. 117366W/W-100018) as statutory auditors of the Company until conclusion of the 49th annual general meeting of the Company at such remuneration as may be agreed by the Board of Directors with the auditors.

24. ESG (ENVIRONMENT, SOCIAL & GOVERNANCE)

We stand firmly by our commitment towards instituting a sustainable business strategy to positively impact the environment and society while also catering to our shareholders.

Our Company's growth is not limited to economic performance but also our environmental and social performance.

Our philosophy is to conduct business in a socially, environmentally, and ethically responsible manner with a defined approach towards environmental protection, natural resource conservation, and cost efficiency in order to ensure the safety & health protection of our employees, communities, and the planet at large.

This year we published our maiden Sustainability report which is a testament to our unwavering commitment to creating a positive impact across various facets of Environment, Social, and Governance (ESG). This report has been prepared in accordance with the GRI Standards: Core option United Nations Sustainable Development Goals (UN SDGs).

In this endeavour, we conducted a comprehensive analysis to understand areas which can be improved to propel our sustainability agenda forward. It entailed enhancing our processes, systems, and policies that nurture an equitable, environmentally conscious, and gender sensitive culture. We also conducted an extensive stakeholder engagement exercise this year to take into consideration their perspective which helped us to gauge their ESG expectations as well as identify the key priority areas for the business to focus on.

The materiality assessment, based on the engagement, formed the foundation of our maiden Sustainability Report.

As we move forward, the Company remains committed towards reducing the environmental burden, generating more clean energy and decreasing CO2 emissions in absolute or as a percentage of units produced and continue its efforts towards social transformation as we address patients' needs with utmost importance and ensure accessibility and affordability of healthcare for all.

25. OTHER DISdOSURES AND Confirmations

Board has to make further disclosures and provide confirmations, as required, as under:

• The Company has placed annual return referred to in subsection (3) of section 92 on its website www.jbpharma.com.

• No regulator or court or tribunal has passed, during the year, any significant or material order affecting the going concern status and Company's operations in future.

• The Company has complied with applicable Secretarial Standards specified by the Institute of Company Secretaries of India and approved by the Central Government under Section 118(10) of the Companies Act, 2013.

• The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

26. Health AND SAFETY

The Company continues to accord high priority to health and safety of employees and workmen at all manufacturing locations. Annual medical check-up of all employees at all sites was carried out. The Company also conducted safety training programmes and mock-drills for increasing disaster preparedness and creating awareness among all employees at the plants. There was no casualty at any site during the year.

For and on behalf of the Board of Directors

J B Chemicals & Pharmaceuticals Ltd Company Background

J B Chemicals & Pharmaceuticals Ltd Company Management

J B Chemicals & Pharmaceuticals Ltd Listing Information

J B Chemicals & Pharmaceuticals Ltd Finished Product