gujarat themis biosyn ltd Directors report

The Members,

Gujarat Themis Biosyn Limited

Your Directors have pleasure in presenting herewith the 42nd Annual Report together with the Audited Accounts of the Company for the Financial Year ended 31st March, 2023.

1. FINANCIAL STATEMENTS & RESULTS: a. FINANCIAL RESULTS:

The Companys performance during the year ended 31st March, 2023 as compared to the previous financial year, is summarized below: (Rs. in Lakhs)

Particular	For the financial year ended 31st March, 2023	For the financial year ended 31st March, 2022
Income	15,499.67	11,890.40
Less: Expenses	7,753.19	5,986.95
Profit/ (Loss) before tax	7,746.48	5,903.45
Current Tax	1,924.06	1,533.80
Deferred tax	25.54	7.24
Adjustment of tax relating to earlier periods	-	-
Profit after Tax	5,796.88	4,362.42

b. OPERATIONS:

Your Company is in the business of manufacturing and sale of raw material by fermentation process. Your Companys performance during the year in terms of Turnover and Profit was substantially better than the previous year. The change in business model made three years ago which was reported earlier has continued to help the Company to report a good financial performance. During the period, sale of finished products recorded atRs.14,812.97 Lakhs (previous year Rs.11,419.17 Lakhs) registering increase in sale. The Net Profit after tax recorded by the Company for the year under review is Rs.5,796.88 Lakhs as compared to net profit ofRs.4,362.42 Lakhs during previous year registering an increase of 32.88%. There are no material changes and commitments affecting the financial position of the Company between the end of the financial year and as on the date of thereport.

c. SUBSIDIARIES

The Company does not have any subsidiary.

d. ASSOCIATES

The Company does not have any Associate Company.

e. DIVIDEND

At the Board meeting held on 21st November 2022, the Board had declared an interim dividend of Rs.4.40/- (Four Rupees Forty Paisa only per share) (88%). Total dividend payout was Rs.6,39,626,289.

Your Directors are pleased to recommend a final dividend of Rs.1.00/- per share for the financial year 2022-23. Total dividend payout works out to Rs.1,45,28,702.

Pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "SEBI Listing Regulations"), as amended, the Dividend Distribution Policy of the Company is available on the Companys website at http://www.gtbl.in/investors/policies/ .

f. TRANSFER TO RESERVES:

Your Board has not recommended transfer of any amount of profit to reserves during the year under review.

g. REVISION OF FINANCIAL STATEMENT:

There was no revision of the financial statements for the year under review.

h. DEPOSITS:

Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 (the "Act") and the Companies (Acceptance of Deposits) Rules, 2014.

2. DISCLOSURES UNDER SECTION 134(3)(l) OF THE COMPANIES ACT, 2013:

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companys financial position have occurred between the end of the financial year of the Company and date of this

3. STATEMENT ON DECLARATION UNDER SECTION 149(6) OF THE COMPANIES ACT, 2013:

The Board has received declarations from the Independent Directors under section 149(6) of the Act that they are not otherwise disqualified to be Independent Directors. The Board further States that all the Independent Directors are persons of integrity and possesses relevant expertise and experience to discharge their duties and roles as Independent Directors of the Company.

4. STATEMENT UNDER SECTION 178:

Your Company has constituted Nomination and Remuneration Committee as well as Stakeholders Relationship Committee as prescribed under section 178(1) of the Act. The Nomination and Remuneration Committee considers that the Qualifications, Experience and positive attributes of the Directors on the Board of the Company are sufficient enough to discharge their duties as such. During the financial year 2022-23, the Company has paid sitting fees to the Independent Directors for attending Board meetings, Audit Committee Meetings and also for Separate Independent Directors Meeting.

Policy on Nomination and Appointment of Directors/Criteria for appointment of Senior Management and Remuneration Policy as formulated under Section 178(3) of the Act is annexed as "Annexure I" and forms part of this Report.

5. BOARDS EXPLANATION ON AUDITORS REPORTS:

I. Explanation on Statutory Auditors Report

There are no qualifications, reservations or adverse remarks or disclaimer made by the Statutory Auditors in respect of financial statements as on and for the year ended 31 st March, 2023.

II. Explanation on Secretarial Auditors Report

Provisions of Section 204 read with Section 134(3) of the Act mandates the Company to obtain Secretarial Audit Report from Practicing Company Secretary. M/s. HSPN & Associates LLP, Practicing Company Secretaries were appointed to conduct Secretarial Audit and issue Report for the financial year 2022-23.

Secretarial Audit Report issued by M/s. HSPN & Associates LLP, Practicing Company Secretaries in Form MR-3 for the financialyear 2022-23 forms part to this report. The report of the Secretarial Auditor is annexed to this report as

Annexure II.

6. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

Details of Loans, Guarantees and Investments, covered under the provisions of Section 186 of the Act are given in Notes to the Financial Statements.

7. PARTICULAR OF CONTRACTS OR ARRANGEMENT WITH RELATED PARTIES

The Company in the ordinary course of its business, enters into transactions for purchase and sale of goods, materials & services, other obligations from ‘Related Parties within the meaning of Section 2(76) of the Act and Regulation 23 of the SEBI

Listing Regulations .

Contracts/arrangements/transactions entered by the Company during the financial year with related parties were on an arms length basis and in the ordinary course of business. All related party transactions were placed for the approval before the Audit Committee / Board / Shareholders wherever necessary in compliance with the provisions of the Act and the SEBI

Listing Regulations. During the year, the Company has not entered into any contracts/arrangements/transactions with related parties which could be considered material in accordance with policy of the Company on material related party transactions or under section 188(1) of the Act. Accordingly, there are no particulars to report in Form AOC-2.

The details of the transactions with related parties are also provided in the accompanying financial statements. The Company has formulated a policy on materiality of Related Party Transactions and also on dealing with Related Party Transactions. The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board has been adopted by the Company and uploaded on the Companys website at the link: http://www.gtbl.in/wp-content/ uploads/2015/08/Related-Party-Policy.pdf

8. DISCLOSURE OF INTERNAL FINANCIAL CONTROLS.

The Internal Financial Controls with reference to financial statements as designed and implemented by the Company are adequate. During the year under review, no material or serious observation has been received from the Internal Auditors of the Company for inefficiency or inadequacy of such controls.

9. DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL:

During the financialyear 2022-23 no orders have been passed by any Regulator or Court or Tribunal which can have impact on the going concern status and the Companys operations in future.

10. DISCLOSURE UNDER SECTION 43(a) (ii) OF THE ACT:

The Company has not issued any shares with differential rights and hence no information is provided as per provisions of Section 43(a) (ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014.

11. DISCLOSURE UNDER SECTION 54(1) (d) OF THE ACT:

The Company has not issued any sweat equity shares during the year under review and hence no information as per provisions of Section 54(1) (d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

12. DISCLOSURE UNDER SECTION 62(1)(b) OF THE ACT :

The Company has not issued any equity shares under Employees Stock Option Scheme during the year under review and hence no information is provided as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014.

13. DISCLOSURE UNDER SECTION 67(3) OF THE ACT :

During the year under review, there were no instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 is furnished.

14. MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL:

1) CHANGES IN BOARD OF DIRECTORS:

In accordance with the provisions of the Act and the Articles of Association of the Company, Dr. Dinesh S. Patel (DIN: 00033273), Director of the Company, retires by rotation at the ensuing Annual General Meeting (AGM) and being eligible offers himself for re-appointment. The Board recommends to the members the re-appointment of Dr. Dinesh S. Patel (DIN: 00033273) as Director in the ensuing AGM of the Company.

Necessary ordinary Resolution for the reappointment of Dr. Dinesh S. Patel (DIN: 00033273) is included in the Notice convening the ensuing Annual General Meeting.

There were no other changes in Directors during the year.

CHANGES IN KEY MANAGERIAL PERSONNEL

1. Mr. Jagdish G. Kaujalgi, Chief Executive Officer has resigned w.e.f. 10 th July, 2022.

2. Mr. Tapas Guha Thakurata was appointed as Chief Executive Officer w th January, 2023.

There were no other changes in Key Managerial Personnel during the year.

BOARD MEETINGS:

The Board of Directors met 6 (Six) times during the financial year ended on 31 st March, 2023 in accordance with the provisions of the Act and rules made there under.

The Meetings of the Board of Directors are held at regular intervals of not more than one hundred and twenty days. These are generally scheduled well in advance. The Board meets at least once a Quarter to review the Performance and Financial Results of the Company. All the major decisions are taken at the Board meeting wherein Directors are provided with all material information. The Senior Executives of the Company are invited to attend the Board meeting and provide clarifications as and when required.

DIRECTORS RESPONSIBILITY STATEMENT:

In terms of Section 134(5) of the Act, in relation to the audited financial statements of the Company for the year ended 31^st March, 2023, the Board of Directors hereby confirms that: i) in the preparation of the annual accounts, the applicable accounting standards had been followed and there is no material departures according to the accounting standards; ii) such accounting policies have been selected and applied consistently and the Directors 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 as at 31st March, 2023 and of the profit of the Company for that year; iii) proper and sufficient care was taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; iv) the annual accounts of the Company have been prepared on a going concern basis; v) internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate and were operating effectively; vi) proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

COMMITTEES OF THE BOARD OF DIRECTORS

In compliance with the requirement of applicable laws, the Company has following Committees of the Board as on 31st March, 2023: i. Audit Committee; ii. Stakeholders Relationship Committee; iii. Nomination and Remuneration Committee; iv. Corporate Social Responsibility Committee The details with respect to the aforesaid Committees form part of the Corporate Governance Report.

As per Regulation 21 of the SEBI Listing Regulations, top 1000 listed entities determined on the basis of market capitalisation as on 31^st March are required to constitute Risk Management Committee. Accordingly, the Board, at its meeting held on 13^th May 2023, has formed a Risk Management Committee. A detailed note on the composition of the Board and its committees is provided in the Corporate Governance Report.

VIGIL MECHANISM POLICY FOR THE DIRECTORS AND EMPLOYEES:

The Board of Directors of the Company has, pursuant to the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, framed "Vigil Mechanism Policy" for Directors and employees of the Company to provide a mechanism which ensures adequate safeguards to employees and Directors from any victimization on raising of concerns of any violations of legal or regulatory requirements, incorrect or misrepresentation of any financial statements and reports, etc.

As per SEBI (Prohibition of Insider Trading) (Amendment) Regulation, 2018 which amends SEBI (Prohibition of Insider Trading) Regulation, 2015, the listed company shall have a whistle blower policy and make employees aware of such policy to enable employees to report instances of leak of unpublished price sensitive information.

Considering the above amendment in SEBI (Prohibition of Insider Trading) Regulations, 2015, the Vigil Mechanism Policy of the Company was amended with effect from 1st April, 2019 to enable employees to report instances of leak of unpublished price sensitive information.

The employees of the Company have the right/option to report their concern/grievance to the Chairman of the Audit Committee. The said Policy is available on the website of the Company at http://www.gtbl.in/wp-content/uploads/2019/04/GTBL-Vigil-Mechanism-or-Whistle-Blower-Policy.pdf The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations.

RISK MANAGEMENT:

We have an integrated approach to managing risks inherent in various aspect of our business.

CORPORATE SOCIAL RESPONSIBILITY POLICY:

Gujarat Themis Biosyn Limited CSR initiatives and activities are aligned to the requirements of Section 135 of the Act. The brief outline of the CSR policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure III of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. For other details regarding the CSR Committee, please refer to the Corporate Governance Report, which is a part of this report. This Policy is available on the Companys website at http://www.gtbl.in/wp-content/uploads/2022/07/CSR-Policy.pdf

ANNUAL EVALUATION OF DIRECTORS, COMMITTEE AND BOARD:

Provision of the Regulation 17 of the SEBI Listing Regulations mandates that the Board shall monitor and review the Board evaluation framework. The Schedule IV of the Act states that the performance evaluation of the Independent Directors shall be done by the entire Board of Directors, excluding the director being evaluated. The Board has carried out an annual evaluation of its own performance, Committees and Individual Directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by the SEBI Listing Regulations.

The performance of the Board and Committees was evaluated by the Board with the help of inputs received from all the Directors and the Committee members on the basis of the criteria such as the Board composition and structure, effectiveness of Board processes, information and functioning, etc. The Board and the Nomination and Remuneration Committee reviewed the performance of the Individual Directors on the basis of the criteria such as the contribution of the individual director to the Board and Committee meetings like ability to contribute and monitor our corporate governance practices, meaningful and constructive contribution in the issues discussed in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role.

In a separate meeting of Independent Directors, performance of non-independent Directors, performance of the Board as a whole and performance of the Chairman was evaluated, taking into account the views other non-executive directors. The same was discussed in the Board meeting that followed the meeting of the Independent Directors, at which the performance of the Board, its committees and individual directors was also discussed. Performance evaluation of independent directors was done by the entire board, excluding the independent director being evaluated. The Board was overall of the opinion that the Independent Directors have contributed through the process of Board and Committee meeting of which they are members in effective manner as per as their expertise in their field and needs of the organization. The suggestions and contributions of the Independent Directors in the working of the Board/Committee were satisfactory and the value addition made by such independent directors individually and as a team is commendable.

DISCLOSURE UNDER SECTION 197(12) OF THE COMPANIES ACT, 2013 AND OTHER DISCLOSURES AS PER RULE 5 OF COMPANIES (APPOINTMENT & REMUNERATION) RULES, 2014:

The Company has not paid any remuneration to the Directors during the financial year 2022-23 and hence disclosure under this section is not applicable.

However, in respect of Key Managerial Personnel, the disclosure is attached as Annexure IV.

15. AUDITORS:

STATUTORY AUDITORS

M/s. GMJ & Co., Chartered Accountants (Firm Registration No.103429W), the Statutory Auditors of the Company, were appointed by the members at the 41st Annual General Meeting (AGM) to hold such office till conclusion of the 46th AGM. The Ministry of Corporate Affairs (MCA), vide its commencement Notification No. SO 1833(E) dated 7th May, 2018, has notified and amended the relevant provision of the Act relating the requirement of placing the matter relating to ratification of appointment of Statutory Auditors by members at every Annual General Meeting. The said amendment has done away with the requirement of Ratification of appointment of the Statutory Auditors. Therefore, M/s. GMJ & Co., Chartered Accountants will continue to hold office till conclusion of the 46th AGM and their appointment will not be subject to ratification by the members at every intervening AGM held after 41st AGM.

MAINTENANCE OF COST RECORDS:

Maintenance of cost records is required as specified by the Central Government under sub-section (1) of section 148 of the Act and accordingly such accounts and records are made and maintained.

COST AUDITORS:

Pursuant to the provisions of Section 148 of the Act read with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors on recommendation of the Audit Committee, appointed M/s. Raja Datta & Co., Cost Accountants (Firm Registration No. 101555) as the Cost Auditors of the Company for the financial year 2023-24 for the applicable Product. Pursuant to Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, appropriate resolutions seeking your ratification to the remuneration of the said Cost Auditors is appearing in the Notice convening the 42nd AGM of the Company.

16. OTHER DISCLOSURES:

Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under:

a. EXTRACT OF ANNUAL RETURN:

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31st March, 2023 will be available on the Companys website on https://www.gtbl.in.

b. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: The particulars as required under the provisions of Section 134(3) (m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in Annexure V which forms part of this Report.

c. CORPORATE GOVERNANCE: Report on Corporate Governance and Certificate of Auditors of your Company regarding Corporate Governance as stipulated in regulation 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 of the SEBI Listing Regulations with the Stock Exchanges, are enclosed as a separate section and a part of this report in Annexure

VI. d. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT:

In accordance with Regulation 34(2) of the SEBI Listing Regulations, the inclusion of Business Reporting and Sustainability Report (BRSR) as a part of the Annual Report is mandated for top 1000 listed entities based on the market capitalization. BRSR for the financial year 2022-23 has been prepared in accordance with the format prescribed by SEBI. The summary of the BRSR is appended herewith as Annexure VII to this Report.

17. PREVENTION OF SEXUAL HARASSMENT:

We have zero tolerance for sexual harassment at the workplace and have adopted a Policy on prevention, prohibition and redressal of sexual harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of Complaints of Sexual Harassment at the workplace.

During the financial year ended 31st March, 2023 your Company has not received any complaint related to sexual harassment.

18. SECRETARIAL STANDARDS:

The Company has complied with the applicable Secretarial Standards, as issued by the Institute of Company Secretaries of India and notified by the Central Government.

19. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY: There are no material changes and commitments affecting the financial position of the Company between the end of the financial year and as on the date of the report.

20. MANAGEMENT DISCUSSION & ANALYSIS: Cautionary Statement:

The statements in the "Management Discussion and Analysis Report" describe the Companys objectives, projections, estimates and expectations which may be "forward-looking statements" within the meaning of the applicable laws and regulations. The actual results could differ materially from those expressed or implied, depending upon the economic and climatic conditions, government policies, taxation and other laws and other incidental factors.

Financial Overview: financial year ended 31 The st March, 2023, is as follows:

Total revenue from operations stood at Rs.148.97 Crores for the year ended 31st March, 2023, as against Rs.114.85 Crores for the corresponding previous period, an increase of 29.71%.

The cost of raw materials incurred for the financial year ended 31 st March, 2023 was Rs.29.73 Crores as against Rs.21.75 Crores for the corresponding previous period.

The EBIDTA (earnings before interest, depreciation and tax, excluding other income) was Rs.74.22 Crore for the year ended 31^st March, 2023, as against Rs.58.05 Crore for the corresponding previous period, an increase of 27.86%.

The finance cost for the financial year ended 31st March, 2023 was Rs.0.20 Crore as against Rs.0.83 Crore for the corresponding previous period.

The PAT (profit after tax) was Rs.57.96 Crores for the year ended 31st March, 2023, as against Rs.43.62 Crores for the corresponding previous period, an increase of 32.87%.

Resources and Liquidity:

The cash and cash equivalents at the end of 31st March, 2023 were Rs.6.06 Crore. The net debt to equity ratio of the Company stood at 0.0 (zero debt) as on 31st March, 2023.

Business category wise performance:

The Company operates in one segment i.e. pharmaceuticals. The results of the Company under review depict business growth during the period. The Company is presently manufacturing Rifamycin S, which is an intermediate for manufacturing the drug Rifampicin (an Antibiotic used for the treatment of several types of bacterial infections, including tuberculosis, Mycobacterium avium complex, leprosy, and Legionnaires disease.) and Rifamycin O, which is an intermediate for manufacturing the drug Rifaximin (this is an Antibiotic used for treatment of travelers diarrhea, irritable bowel syndrome, and hepatic encephalopathy).

Risks & Concerns:

The business of the Company is exposed to a few risks. Risks, liabilities and losses are part and parcel of any industry and need to be tackled through well forecasted strategies and actions.

Unfavourable Policy Changes

In the past few years, the Government of India has made frequent changes in the drug pricing and other laws impacting the operations of the Company. Further adverse changes in government policies with respect to essential medicines and pricing with respect to the products may impact margins of the Company. The Government policies are creating new risks for domestic market by including new molecules to the price control umbrella and also by issuing ban on various Fixed Dose Combinations.

Credit Risk

To manage its credit exposure, GTBL has determined a credit policy with credit limit requests and approval procedures. The Company does its own research of a counterpartys financial health and business prospects. Timely and rigorous process is followed up with clients for payments as per schedule. The Company has suitably streamlined the process to develop a focused and aggressive receivables management system to ensure timely collections.

Competition Risk

Like in most other industries, growth opportunities lead to a rise in competition. We face different levels of competition, from domestic as well as Chinese companies. GTBL has created strong differentiators in execution, quality and delivery which make it resilient to competition. Furthermore, the Company continues to invest in R&D and its people to maintain a competitive edge. Stable and long-standing client relationships further help maintain a strong order book and insulate the Company from this risk. We also mitigate this risk with the quality of our infrastructure and specialized fermentation-based methodologies, coupled with prudent financial and human resources management and better control over costs.

Input Cost Risk

Our profitability and cost effectiveness are affected by changes in the prices of raw materials, power and other input costs.

OPPORTUNITIES & THREATS: Opportunities Growth in Pharma Sector

The Indian healthcare and pharmaceuticals sector is one of the fastest growing in the world. India supplies around 20% of the global pharmaceuticals demand in terms of volume.

Generic drugs, over-the-counter medications, bulk drugs, vaccines, contract research & manufacturing, biosimilars, and biologics are some of the major segments of the Indian pharma industry. India has the most number of pharmaceutical manufacturing facilities that are in compliance with the US Food and Drug Administration (USFDA) and has 500 API producers that make for around 8% of the worldwide API market.

Indian pharmaceutical sector supplies over 50% of global demand for various vaccines, 40% of generic demand in the US and 25% of all medicine in the UK. The domestic pharmaceutical industry includes a network of 3,000 drug companies and 10,500 manufacturing units.

The market bounced back to register its strongest-ever double-digit growth in fiscal 2023. Industry sales rose 20.3% year-on-year in February 2023 against a 0.2% year-on-year decline in February 2022, and 2.3% growth in January this year, according to data from the All Indian Origin Chemists and Distributors.

The Indian pharma industry is currently valued at $49 billion and is the third largest in the world. The sector is expected to grow to $130 billion by 2030 as per estimates from Indian Pharmaceutical Alliance (IPA).

Sources: https://www.bqprime.com/business/indian-pharma-market-reports-double-digit-growth-in-february https://www.business-standard.com/article/companies/indian-pharma-industry-likely-to-grow-to-130-bn-by-2030-says-ipa-122091500656_1.html https://www.ibef.org/industry/pharmaceutical-india

Government Initiatives

Favourable schemes made by the Government of India in the recent past to support and grow the Pharmaceuticals sector bode well for companies operating in this industry.

The Union Budget 2022-23 introduced several new schemes to provide impetus to the pharma and healthcare sector in India:

? Rs.3,201 crore (US$ 419.2 million) has been set aside for research and Rs. 83,000 crore (US$ 10.86 billion) has been allocated for the Ministry of Health and Family Welfare

? Rs. 37,000 crore (US$ 4.83 billion) has been allocated to the National Health Mission

? Rs. 10,000 crore (US$ 1.28 billion) has been allocated to Pradhan Mantri Swasthya Suraksha Yojana

? The Ministry of AYUSH has been allocated Rs. 3,050 crore (US$ 399.4 million), up from Rs. 2,970 crore (US$ 389 million) Sources: https://www.ibef.org/industry/pharmaceutical-india.aspx Threats Threat from Global Competitors

Indian pharma companies will face competition from bigger, global pharma companies, backed by larger financial strength. Generic drugs offer cost-effective alternatives to drugs innovators and significant savings to customers

Threat from Impact of COVID-19

While the pandemic has spurred demand for specific pharma products in India and globally, the lockdowns to contain the virus can also hamper production and logistics operations to some extent.

Internal control system and adequacy:

The Company ensures the orderly and efficient conduct of its business, including adherence to Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the CompaniesAct, 2013. The Statutory Auditors while conducting the statutory audit, review and evaluate the internal controls and their observations are discussed with the Audit Committee of the Board. Other statutory requirements especially, in respect of pharmaceutical business are also vigorously followed in order to have better internal controls over the affairs of the Company.

Outlook:

Medicine spending in India is projected to grow 9-12% over the next five years, leading India to become one of the top 10 countries in terms of medicine spending. Going forward, better growth in domestic sales would also depend on the ability of companies to align their product portfolio towards chronic therapies for diseases such as cardiovascular, anti-diabetes, anti-depressants and anti-cancers, which are on the rise.

The Indian Government has taken many steps to reduce costs and bring down healthcare expenses. Factors including ageing population, rise in chronic diseases, and government programmes such as the National Health Protection Scheme (which aims to offer universal healthcare), opening of pharmacies that offer inexpensive generic medications, should all contribute to boost the Indian pharmaceutical industry. Speedy introduction of generic drugs into the market has remained in focus and is expected to benefit Indian pharma companies. In addition, the thrust on rural health programmes, lifesaving drugs and preventive vaccines also augurs well for companies in this sector.

There are very few companies in India which have the expertise in the field of fermentation. Many products manufactured by fermentation are not made in India. The countrys needs are largely met through imports. GTBL is continuously identifying fermentation-based products which have good domestic and export potential. The Company is also investing in R&D for technological developments for new product development.

With such R&D and manufacturing capacities in place, GTBL is in a good position to capitalize on the significant growth opportunities in this sector going forward.

Sources: https://www.ibef.org/industry/pharmaceutical-india https://www.ibef.org/download/1659942652_Pharmaceuticals-June_2022.pdf https://www.ibef.org/industry/pharmaceutical-india.aspx

OPERATIONAL OVERVIEW:

The Company constantly reviews its product portfolio and market with the view to sustain its growth. The Company has driven fiscal growth by focusing on the following areas.

a) Industry structure and developments:

The Indian pharmaceutical industry has established a global presence with its competitive prices and high-quality medicines. India is responsible for producing 60% of the worlds vaccines and 20% of generic drugs. Additionally, the country allows 100% foreign direct investment (FDI) in the pharmaceutical sector, making it easier for international businesses to enter the market.

Indias pharmaceutical exports reach over 200countriesworldwide,makingit significant contributor to the global healthcare industry. The country supplies over 50% of Africas generic drug demand, approximately 40% of the USs generic drug demand, and approximately 25% of the UKs medicine supply. India also plays a significant role in providing vaccines globally, with over 70% of the World Health Organizations (WHO) vaccines sourced from the country. Moreover, Indian pharmaceuticalcompanieshavemadesignificantcontributions to fighting diseases such as AIDS, with over 80% of the antiretroviral drugs used globally being supplied by Indian firms. quality have earned it the title of the "pharmacy of the world". Indias status as the largest provider of generic medicines globally, accounting for 20% of global export in terms of volume, further cements its position as a major player in the global pharmaceutical industry.

Going forward, better growth in domestic sales would also depend on the ability of companies to align their product portfolio towards chronic diseases.

Source:https://www.clearias.com/indian-pharmaceutical-industry/#indian pharmaceutical-industry b) Government Initiatives for Pharmaceuticals Industry:

Government Support for Indian Pharma Sector

In the year 2022, various programs and initiatives were implemented in the Department of Pharmaceuticals.

Major achievements of the Department this year include schemes like Pradhan Mantri Bhartiya Janaushadhi Pariyojana to provide quality generic medicines at affordable prices to the poor and underprivileged and PLI scheme to strengthen Indias manufacturing capacity in the pharmaceutical sector by increasing investment and production.

Apart from this, the department also laid special emphasis on promoting domestic manufacturing of medical equipment and strengthening the pharmaceutical industry.

The Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP) scheme is dedicated to provide generic medicines at affordable prices to the masses. The Product basket of PMBJP comprises 1,759 drugs and 280 surgical products. The target is to enhance the product basket to include 2,000 medicines and 300 surgical products by March 2025 so that all essential medicines covering therapeutic groups, like Anti Diabetics, Cardiovascular Drugs, Anti-Cancer, Analgesics & Antipyretics, Anti Allergic, Gastro Intestinal Agents, Vitamins, Minerals & Food supplements, Tropical Medicines, etc., are provided.

The Strengthening of Pharmaceutical Industry (SPI) scheme would be operational over a period of five years from FY

21-22 to 25-26 and has an outlay of Rs. 500 cr. The Scheme has 3 components / sub-schemes:

? Assistance to Pharmaceutical Industry for Common Facilities (APICF)

? Pharmaceutical Technology Upgradation Assistance Scheme (PTUAS)

? Pharmaceutical & Medical Devices Promotion and Development Scheme (PMPDS)

Assistance to Pharmaceutical Industry for Common Facilities (APICF), to strengthen the existing pharmaceutical clusters capacity for their sustained growth by creating common facilities. Under the sub-scheme, an outlay of Rs.178 Cr for the scheme period of five years is proposed to support clusters for creation of common facilities with the focus on R&D Labs, Testing Laboratories, Effluent Treatment Plants, Logistic Centers and Training Centers, etc.

Pharmaceutical Technology Upgradation Assistance Scheme (PTUAS), the scheme covers upgradation of all equipment & instruments for operating a Microbiology laboratory including autoclaves, incubators, biosafety cabinets, HVAC systems. Pharmaceutical & Medical Devices Promotion and Development Scheme (PMPDS), the scheme has an outlay of Rs. 21.5 Cr that will be leveraged across the period of five years to promote knowledge and awareness about the Pharmaceutical and MedTech and also to facilitate growth and development of Pharmaceutical and Medical Devices Sectors through study/ survey reports, awareness programs, creation of database, and promotion of industry.

Sources: https://pib.gov.in/PressReleseDetail.aspx?PRID=1885753 https://www.investindia.gov.in/team-india-blogs/strengthening-pharmaceutical-industry-spi-scheme- msmes#:~:text=Department%20of%20Pharmaceuticals%20along%20with,their%20productivity%2C%20quality%20 and%20sustainability

Companys Strategy

The Company is finding new avenues by expanding its existing production capacity.

As part of its growth strategy, the Company is investing in new product development through R&D and will subsequently expand capacity. The top line and profitability of the Company have continued to sustain over the last year. The Company is fully aware of its capabilities and strengths and is going ahead with hand holding strategy with Pharmaceutical majors.

c) Segment wise or product-wise performance:

The Company operates in single segment i.e., pharmaceuticals. The results of the Company under review depict business growth during the period.

d) Discussion on financial performance with respect to operational Performance:

The operational performance during the year under review has grown year-on-year. The Company de-coupled with its South-Korean partner, Yuhan Corporation.

The Profit after Tax increased by 32.88% compared to previous year. The Company has generated profit during the year under review as well as in the previous year.

e) Material developments in Human Resources/Industrial Relations front, including number of people employed:

The core of the Human Resource philosophy at Gujarat Themis Biosyn Ltd. is empowering human resources towards achievement of company aspirations. Your Company has a diverse mix of youth and experience which nurtures the business. As on 31st March 2023 the total employee strength was 109

f) Details of significant changes in key financial ratios (i.e. change of 25% or more as previous financial year):

Sr.No	Particulars	2022-23	2021-22
1.	Debtors Turnover ( in days)	52.71 days	63.29 days
2.	Inventory Turnover (in days)	32.13 days	28.06 days
3.	Interest Coverage Ratio	399.73:1	75.01:1
4.	Current Ratio	3.98:1	4.57:1
5.	Debt Equity Ratio	-	-
6.	Operating Profit Margin (%)	52.13%	52.12%
7.	Net Profit Margin (%)	38.91%	37.98%

(g) Details of any change in Return on Net Worth as compared to the immediately previous financial year along with a detailed explanation thereof.

Financial year	2022-23	2021-22
Return on net worth (%)	38.87%	42.22%

The Return on net worth decreased during the year 2022-23 as compared to previous year 2021-22 but increase in the profit fromRs.4362.42 Lakhs in 2021-22 to Rs. 5796.88 Lakhs in year 2022-23.

22. ACKNOWLEDGEMENT:

Your Directors have pleasure to place on record their sincere appreciation for the continued co-operation and support extended to the Company by Union Bank of India, all the Employees, Indian promoters, various other Government authorities and of course, shareholders.