natco pharma ltd Management discussions

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<dhhead>BOARDS REPORT</dhhead>

The Board takes pleasure in presenting the 40^th Annual Report of the Company along with the Audited Financial Statements and other reports for the year ended March 31, 2023.

COMPANY OVERVIEW

There are two business segments of NATCO: Pharmaceuticals and Agrochemicals. Pharmaceuticals is the dominant business segment contributing a major portion of revenue. It comprises of FDFs and APIs. APIs business is strategic and serves captive requirements and third party sales. Capabilities in APIs include complex multi-step synthesis & scale-up, advanced synthetic/ separation technologies, containment facility for handling high-

potency APIs, synthesis of peptide (solid phase pharmaceuticals, oligo nucleotide pharmaceuticals etc. and a well established process safety engineering lab. FDF business is predominantly focused on high-barrier-to-entry products. It serves international customers in United States, Canada, Brazil, Philippines, Asia Pacific etc. Our R&D capabilities are demonstrated by its complex and niche product filings in formulations and API segments. Agrochemicals business segment is carried under Crop Health Sciences division of the Company. It has successfully launched broad-spectrum insecticide Chlorantraniliprole (CTPR) and its combination products in India across key agrarian states.

FINANCIAL SUMMARY

	STANDALONE		CONSOLIDATED
PARTICULARS	Year ended 31st March 2023	Year ended 31st March 2022	Year ended 31st March 2023	Year ended 31st March 2022
Net Revenue /Income	24365	18624	28117	20438
Gross profit before interest and depreciation	9302	3076	10402	3625
Finance Cost	86	133	145	177
Profit before depreciation and Amortisation - (Cash Profit)	9216	2943	10257	3448
Depreciation and Amortisation	1509	1384	1638	1426
PBT before exceptional items	7707	1559	8619	2022
Exceptional items	-	-	-	-
Profit before Tax (PBT)	7707	1559	8619	2022
Provision for Tax -Current	1331	325	1627	478
Provision for Tax -Deferred	5	(157)	(161)	(156)
Profit after Tax	6371	1391	7153	1700
Other comprehensive income (OCI)	(194)	404	27	497
Total Comprehensive income for the year	6177	1795	7180	2197

The details of the Companys operations have been further discussed in detail in the Management Discussion and Analysis Report.

DIVIDEND

The Company declared three interim dividends for the FY 202223, the details of which are as follows:

S. NO. DATE OF BOARD MEETING	DATE OF PAYMENT	INTERIM DIVIDEND DECLARED ON PER EQUITY SHARE OF FACE VALUE J 2/- EACH (Amount in J)
1. August 9, 2022	August 30, 2022	3.50
2. November 10, 2022	November 30, 2022	0.75
3. February 9, 2023	March 1, 2023	1.25
TOTAL		5.50

The total dividend pay-out amounted to Rs 1004 million resulting in a pay-out of 15.76% of the standalone profit after tax of the Company.

The three Interim Dividends have been paid to all eligible shareholders. Accordingly, your Directors recommend that the above three interim dividends be treated as the final dividend of the Company for the Financial Year 2022-23. The Dividend Distribution Policy is available on the website of the Company at https://www.natcopharma.co.in/wp-content/uploads/2019/08/ Dividend-Distribution-Policy.pdf

TRANSFER TO RESERVES

The Company has not transferred any amount to the general reserve for the financial year ended March 31, 2023.

SHARE CAPITAL

During the year under review, 37,000 equity shares were allotted on May 16, 2022 under Natco Employee Stock Option Scheme,

2017 (NATSOP2017), which were due for allotment as per the NATSOP2017 Scheme.

Further, during the year under review, the Company has bought back 87,050 shares and the same were extinguished as on March 31, 2023.

Accordingly, the issued and subscribed share capital of the Company as on March 31, 2023, stood at Rs 365 million divided into 18,24,70,115 equity shares of Rs 2/- each as against Rs 365 million divided into 18,25,20,165 equity shares of Rs 2/- each as on March 31, 2022.

BUYBACK OF EQUITY SHARES

The Board of Directors at their meeting held on March 8, 2023, the Company was authorised to buyback its fully paid-up equity shares of face value of Rs 2/- (Rupees Two only) each at a price not exceeding Rs 700/- (Rupees Seven Hundred only) per Equity Share (the Maximum Buyback Price) payable in cash for an aggregate amount not exceeding Rs 210,00,00,000/- (Rupees Two Hundred and Ten Crores only) (the Maximum Buy-back Size), from the shareholders of the Company excluding promoters, promoter group and persons who are in control of the Company, via the "Open Market" route through the stock exchanges mechanism, i.e., using the electronic trading facilities of the stock exchanges where the Equity Shares of the Company are listed (i.e., BSE Limited and National Stock Exchange of India Limited), in accordance with the provisions of Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018, as amended ("Buyback Regulations") and the Companies Act, 2013 (including the rules and regulations framed thereunder), as amended, and other applicable provisions (the process hereinafter referred to as the "Buyback").

The Buyback commenced on March 21, 2023 in accordance with the provisions of Buyback regulations. In this regard, as on May 12, 2023, the Company has bought back 34,47,295 (Thirty Four Lakhs Forty Seven Thousand Two Hundred and Ninety Five) Equity Shares at an average price of H 609.1712 (Rupees Six Hundred Nine and paisa One Seven One Two only) per Equity Share for an aggregate consideration of H 209,99,92,885.33 (Rupees Two Hundred and Nine Crores Ninety Nine Lakhs Ninety Two Thousand Eight Hundred Eighty Five and paisa Three Three only) which represents 100.00% of the Maximum Buyback Size. Accordingly, the Buyback Committee has approved the closure of Buyback pursuant to the terms of the Public Announcement, with effect from the closing of trading hours of May 12, 2023, prior to the six months from the date of commencement of the Buyback.

Accordingly, the Company has made payment to the shareholders and extinguished all the shares bought back within stipulated time period and complied with all the regulatory filings.

DEPOSITS

During Financial Year 2022-23, the Company did not accept any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014 and therefore no amount

of principal or interest was outstanding, as on the date of balance sheet.

CHANGE IN THE NATURE OF BUSINESS, IF ANY

During the year under review, there was no change in the nature of business of the Company or any of its Subsidiaries.

SUBSIDIARIES

The Company has Eight (8) international subsidiaries including (2) step-down subsidiaries as on 31^st March, 2023. The consolidated financial statement of the Company and all its subsidiaries prepared under Indian Accounting Standards (Ind AS) specified under Section 133 of the Companies Act, 2013 form part of the annual report. The Company has not acquired any other Subsidiary Company nor any of the existing Subsidiary Company(s) are ceased to become Subsidiary of the Company during the Financial Year 2022-23.

Further, the Board of Directors at their meeting held on April 20, 2023 have approved to incorporate a Subsidiary Company in Indonesia. The Board of Directors at their meeting held on May 29, 2023 have approved to incorporate a wholly-owned subsidiary Company in Colombia and approved to acquire M/s. Zista Pharma Limited, United Kingdom i.e., 100% on acquisition and will become a Wholly-owned Subsidiary Company to the Company subject to due diligence and compliance with regulatory requirements.

Further, a Statement containing the salient features of the Financial Statements of the Subsidiaries in the prescribed Form AOC-1, is attached as "Annexure - I" to the Boards Report. This Statement also provides the details of the performance and financial position of each Subsidiary.

In accordance with Section 136 of the Companies Act, 2013, the Audited Financial Statements and related information of the Subsidiaries, where applicable, will be available for inspection during regular business hours i.e., from 9:00 a.m. to 5:30 p.m. at the Companys registered office in Hyderabad, Telangana, India.

MATERIAL SUBSIDIARIES

As per Regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), a "material subsidiary" to mean a subsidiary, whose income or net worth exceeds ten percent of the consolidated income or net worth respectively, of the listed entity and its subsidiaries in the immediately preceding accounting year. None of the Subsidiary Companies are material subsidiary to the Company based on the income or net worth as on March 31, 2023.

However, NATCO Pharma (Canada) Inc., Canada is the material subsidiary of the Company based on the income or net worth of the Company for Financial Year 2020-21 and will continue as material subsidiary as per Regulation 3 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In addition to the above, Regulation 24 of the Listing Regulations requires that at least one Independent Director on the Board of

Directors of the listed entity shall be a Director on the Board of Directors of an unlisted material subsidiary, whether incorporated in India or not. For the purpose of this Regulation, material subsidiary means a subsidiary, whose income or net worth exceeds twenty percent of the consolidated income or net worth respectively, of the listed entity and its subsidiaries in the immediately preceding accounting year. Accordingly, the said provision of the appointment of an Independent Director of the Company in the Board of the material subsidiary Company is not applicable, since, the prescribed limits are not exceeded by the Company.

The other requirements of Regulation 24 of the Listing Regulations with regard to Corporate Governance requirements for Subsidiary Companies have been complied with.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

The Company provides investments, loans and guarantees to its subsidiaries /other Companies for its business purpose. Details of investments, loans and guarantees covered under Section 186 of the Companies Act, 2013, form part of the notes to the financial statements provided in this Annual Report.

CORPORATE GOVERNANCE AND ADDITIONAL SHAREHOLDERS INFORMATION

Pursuant to the Listing Regulations, a detailed report on the Corporate Governance systems and practices of the Company is given under Corporate Governance Report which is part of this Annual Report.

A certificate from CS D. Renuka, Company Secretary in Practice (C.P. No. 3460) on the compliance with the conditions of Corporate Governance is part of the Corporate Governance Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

A detailed report on the Management Discussion and Analysis is provided as a separate chapter in this Annual Report.

BOARD OF DIRECTORS

In accordance with the provisions of the Companies Act, 2013, Sri. Rajeev Nannapaneni (DIN: 00183872) and Sri P.S.R.K. Prasad (DIN: 07011140), Directors are liable to retire by rotation and being eligible offers themselves for reappointment at the ensuing Annual General Meeting of the Company.

During the year under review the Board of Directors of the Company has appointed Dr. Pavan Ganapati Bhat (DIN: 09691260) as Director & Executive Vice President (Technical Operations) of the Company with effect from August 9, 2022 which was subsequently approved by the members of the Company at the 39^th Annual General Meeting held on September 30, 2022.

During the year under review there has been no change in the Board of Directors of the Company except the above mentioned changes.

BOARD EVALUATION

A formal annual evaluation has been made by the Board of its own performance, Chairman of the Board, its Committee(s) and individual Director(s). The performance evaluation has been done by the entire Board of Directors, excluding the Director being evaluated. Various evaluation techniques are used to assess the performance of the Directors. The Directors have participated in this evaluation process. The Independent Directors in their separate meeting have also evaluated the performance of the Chairman of the Company, Non-Independent Directors and the Board as a whole.

APPOINTMENT OF DIRECTOR(S), KMPS AND REMUNERATION POLICY

The assessment and appointment of members to the Board is based on a combination of criterion that includes ethics, personal and professional stature, domain expertise, gender diversity and specific qualification required for the position. The Independent Board member is also assessed on the basis of independence criteria defined in Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Listing Regulations.

In accordance with Section 178(3) of the Companies Act, 2013 and on recommendations of Nomination and Remuneration Committee, the Board adopted a remuneration policy for Directors, Key Managerial Personnel (KMPs) and Senior Management which is available on the website of the Company https://www.natcopharma.co.in/wp-content/uploads/2022/06/ Nomination-Remuneration-Policy.pdf

Dr. Pavan Ganapati Bhat (DIN: 09691260) was appointed as Directors and Executive Vice President (Technical Operations) of the Company with effect from August 9, 2022.

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors of the Company have submitted requisite declarations confirming that they continue to meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI Listing Regulations. The Independent Directors have also confirmed that they have complied with the Companys Code of Conduct.

REGISTRATION OF INDEPENDENT DIRECTORS IN INDEPENDENT DIRECTORS DATABANK

All the Independent Directors of the Company have been registered and are members of Independent Directors Databank maintained by Indian Institute of Corporate Affairs.

CONFIRMATION FROM THE BOARD

All the Independent Directors of the Company have given their respective declaration/disclosures under Section 149(7) of the Act and Regulation 25(8) of the Listing Regulations and have confirmed that they fulfill the independence criteria as specified under Section 149(6) of the Act and Regulation 16 of the Listing Regulations and have also confirmed that they are not aware of

any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence. Further, the Board after taking these declaration/disclosures on record and acknowledging the veracity of the same, concluded that the Independent Directors are persons of integrity and possess the relevant expertise and experience to qualify as Independent Directors of the Company and are Independent of the Management.

OPINION OF THE BOARD

The Board opines that all the Independent Directors of the Company strictly adhere to corporate integrity, possesses requisite expertise, experience and qualifications to discharge the assigned duties and responsibilities as mandated by the Companies Act, 2013 and Listing Regulations diligently.

NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES AND OTHER COMMITTEES

The Board currently has eight (8) Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Compensation Committee, Corporate Social Responsibility Committee, Risk Management Committee, Committee Dealing with Land Property and Buyback Committee.

A detailed update on the Board, its composition, detailed charter including terms of reference of various Board Committees, number of Board and Committee meetings held during Financial Year 2022-23 and attendance of the Directors is provided in the Corporate Governance Report, which forms part of the Annual report.

All the recommendations made by the Committees of Board including the Audit Committee were accepted by the Board.

MEETING OF INDEPENDENT DIRECTORS

A separate meeting of the Independent Directors was held on February 9, 2023, inter-alia, to discuss evaluation of the performance of Non-Independent Directors, the Board as a whole, evaluation of the performance of the Chairman, taking into account the views of the Executive and Non- Executive Directors and the evaluation of the quality, content and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties.

The Independent Directors expressed satisfaction with the overall performance of the Directors and the Board as a whole.

BUSINESS RISK MANAGEMENT

The Company has a risk management mechanism in place to manage uncertainties through identification, analysis, assessment, implementing and monitoring to reduce the impact of risks to the business which is discussed in detail in the Management Discussion and Analysis section of this Annual Report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF FINANCIAL YEAR AND DATE OF REPORT

No material changes and commitments have occurred after the close of the financial year till the date of this report which may affect the financial position of the Company.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Company has adopted the Business Responsibility and Sustainability Report (BRSR) in the format specified by SEBI for Financial Year 2022-23. The BRSR is forming part of this Annual Report.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate the Internal Financial Controls commensurate with the business operations of the Company which are operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, the safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosure.

INSURANCE

The Companys plant, property, equipment and stocks are adequately insured against all major risks. The Company also has appropriate liability insurance covers particularly for product liability and clinical trials. The Company has also taken Directors and Officers Liability Policy to provide coverage against the liabilities arising on them.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013 in relation to Financial Statements of the Company for the year ended March 31, 2023, the Board of Directors state that:

a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) The Directors had selected such 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 the Financial Year and of the profit and loss of the Company for that period;

c) The Directors had 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;

d) The Directors had prepared the annual accounts on a going concern basis;

e) The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

RELATED PARTY TRANSACTIONS

In accordance with Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of contract(s) or arrangement(s) entered into by the Company with related parties referred to in Section 188(1) in Form AOC-2 is attached as "Annexure - II" to this Boards Report.

The details of related party disclosures form part of the notes to the Financial Statements provided in this Annual Report.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company believes in upholding professional integrity and ethical behaviour in the conduct of its business. To uphold and promote these standards, the Company has a Vigil Mechanism / Whistle Blower Policy which serves as a mechanism for its Director(s) and employee(s) to report genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Code of Conduct without fear of reprisal. The policy also provides employee(s) access to the Chairperson of the Audit Committee under certain circumstances. The details of the procedures are also available on the website of the Company https://www.natcopharma.co.in/wp-content/uploads/2022/06/ Whistle-Blower-Policy.pdf

A brief note on the Whistle Blower Policy is also provided in the Report on Corporate Governance, which forms part of this Annual Report.

INTERNAL COMPLAINTS COMMITTEE

The Company has Internal Complaints Committees in place in all the units in line with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. A brief note on the same is provided in the Report on Corporate Governance, which forms part of this Annual Report.

AUDITORS

STATUTORY AUDITORS

The members of the Company at their Annual General Meeting held on September 5, 2019 appointed M/s. B S R & Associates LLP (Firm Registration No. 116231W/W-100024) as the Statutory Auditors of the Company to act as such from the conclusion of 36^th Annual General Meeting (AGM) held for the Financial year 2018-19 till the conclusion of the 41^st AGM to be held for the Financial Year 2023-24.

SECRETARIAL AUDITOR

Pursuant to Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment & Remuneration

of Managerial Personnel) Rules, 2014, CS B. Kiran Kumar with Certificate of Practice (CP) No. 15876, Proprietor, M/s. B K & Associates, a Practicing Company Secretary conducted the Secretarial Audit of the Company for Financial Year 2022-23. The Secretarial Audit Report in Form No. MR-3 is attached as "Annexure - III" to this Boards Report.

Upon recommendation of the Audit Committee, the Board has re-appointed CS B. Kiran Kumar (CP No. 15876) Proprietor, M/s. B K & Associates, a Practicing Company Secretary as Secretarial Auditor of the Company for the financial year 2023-24.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 and the Companies (Cost Records and Audit) Rules, 2014, the Company maintains the Cost Audit records which are required to be maintained. The Board on the recommendation of the Audit Committee, reappointed M/s. S.S. Zanwar & Associates (Firm Registration No.100283) as Cost Auditors of the Company for Financial year 2023-24. The provisions also require that the remuneration of the Cost Auditors be ratified by the shareholders and accordingly the same is put forward to the shareholders for their ratification in the ensuing Annual General Meeting. The Cost Audit report for the Financial Year 2022-23 will be filed with the Central Government within the stipulated timeline and the relevant Cost Audit report for FY 2021-22 was filed within the due date to the Central Government.

INTERNAL AUDITORS

The Company has appointed M/s. Grant Thornton Bharat LLP as Internal Auditors of the Company for FY 2023-24 and the Internal Auditors will report to the Audit Committee and the Board of Directors of the Company.

AUDITORS QUALIFICATIONS/ RESERVATIONS/

ADVERSE REMARKS/ FRAUDS REPORTED

There are no Auditors Qualifications or reservations or adverse remarks on the financial statements of the Company. The Auditors have not reported any frauds to the Audit Committee as prescribed under Section 143(12) of the Companies Act, 2013.

There is an observation by the Secretarial Auditor that there was delay in transferring the Unclaimed dividend amounts, required to be transferred from the Unclaimed Suspense Account to the Investor Education and Protection Fund (IEPF) by the Company pertaining to the Financial Years 2014-15 and 2015-16, while the due date(s) of transfer as per the provisions of the Act were 19^th March, 2022 and 19^th March 2023, respectively, the same were actually transferred on 17^th May, 2023 severally.

EXPLANATIONS OR COMMENTS BY THE BOARD ON QUALIFICATION, RESERVATION OR ADVERSE REMARK OR DISCLAIMER MADE

The reason for delay in transfer of Unclaimed dividend amounts from the Unclaimed Suspense Account to the Investor Education and Protection Fund (IEPF) by the Company due to

the reconciliation for the aforesaid Financial Years could not be completed on time to affect the said transfer to IEPF. Hence, there was delay in transfer of the said unclaimed dividend pertaining to the Unclaimed Suspense Account.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE COURTS/REGULATORS

During Financial year 2022-23, there were no significant and/or material orders, passed by any Court or Regulator or Tribunal, which may impact the going concern status or the Companys operations in future.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The Board formulated a Corporate Social Responsibility (CSR) Policy which is in full force and operation and is subject to monitoring by the CSR Committee of Directors from time to time.

The details about the CSR initiatives taken during the Financial Year 2022-23 are discussed in a separate head "Corporate Social Responsibility" which forms a part of this Annual Report.

The Annual Report on CSR activities of the Company is attached as "Annexure - IV" and Impact Assessment report issued by M/s. Give Grants Foundation, Gurgaon is available on the website of the Company at https://www.natcopharma.co.in/investors/ Impactassessmentreport.

TRANSFER OF UNPAID AND UNCLAIMED DIVIDEND AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 124(5) of the Companies Act, 2013, the declared dividends which remained unpaid or unclaimed for a period of seven years, have been transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government pursuant to Section 125 of the said Act the details of which are disclosed in the Corporate Governance Report.

EMPLOYEES STOCK OPTION SCHEME

Details pertaining to the Employee Stock Option Schemes is disclosed in the Corporate Governance Report which forms a part of this Annual Report.

CREDIT RATING

The Companys credit ratings from ICRA on long term borrowings is "AA" and on short term borrowings is "A1+"

PARTICULARS OF EMPLOYEES

The information as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are attached as "Annexure-V" to this Boards Report.

The information required under Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,

2014, is provided in an Annexure forming part of this Report. In terms of the second proviso to Section 136 of the Act, the Report and Accounts are being sent to the Members excluding the aforesaid Annexure. The said annexure is open for inspection at the Registered Office of the Company and any member interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The details of Energy Conservation, Research and Development, Technology Absorption and Foreign Exchange Earnings and Outgo as required under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached as "Annexure-VI" to this Boards Report.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31^st March, 2023 is available on the Companys website on https://www.natcopharma. co.in/investors/ annual return

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India.

GREEN INITIATIVE

To preserve environment, the Company has undertaken number of green initiatives which not only reduce burden on environment but also ensure secured dissemination of information. Such initiatives include energy saving, water conservation and usage of electronic mode in internal processes and control, statutory and other requirement(s).

ACKNOWLEDGEMENTS

The Board wish to place on record their appreciation to shareholders, Government Authorities, banks, business partners, medical practitioners and other stakeholders for the assistance, co-operation and encouragement extended to the Company. The Board also commend the continuing commitment and dedication of the employees at all levels, which has been critical for the Companys success. The Board look forward to their continued unstinted support in future also.

For and on behalf of the Board of Directors
V.C. Nannapaneni	Rajeev Nannapaneni
Managing Director	Director & Chief Executive Officer
DIN: 00183315	DIN: 00183872
Place: Hyderabad
Date: August 09, 2023

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<dhhead>Management Discussion and analysis</dhhead>

Global economy

The global economy continues to face a complex and uncertain landscape. Following the economic contraction caused by the COVID-19 pandemic, the Russian-Ukraine conflict led to a worldwide surge in inflation. Then, the central banks across economies led by the United States Federal Reserve (US Fed) responded with synchronised policy rate hikes to curb inflation. Additionally, the frailties of the Chinese economy further added to subdued growth forecasts. Some of the developed economies have shown signs of rebounding, with increased consumer spending, higher industrial output, and improving labour markets. However, emerging markets and developing countries face a more varied situation, with some experiencing robust growth driven by increased domestic consumption and favourable commodity prices while others are hindered by high debt burdens and slower external demand.

Geopolitical tensions remain a notable concern, impacting trade relationships and investments worldwide. Additionally, the persistence of supply chain disruptions and rising inflationary pressures threaten the overall economic stability. Governments and central banks carefully balance monetary and fiscal policies to support growth. Collaboration and coordinated efforts between nations are becoming increasingly critical to address shared global challenges and foster sustainable and inclusive economic growth in the years ahead.

Global gross domestic product (GDP) growth trend (%)

	2022	2023	2024
World	3.4	2.8	3.0
Advanced economies	2.7	1.3	1.4
US	2.1	1.6	1.1
Eurozone	3.5	0.8	1.4
UK	4.0	(0.3)	1.0
Other advanced economies	2.6	1.8	2.2
Emerging markets and developing economies	4.0	3.9	4.2
China	3.0	5.2	4.5
India	6.8	5.9	6.3

Source: International Monetary Fund (IMF) World Economic Outlook - April 2023

Outlook

The International Monetary Fund (IMF) expects global GDP growth to bottom out to 2.8% in 2023 before stabilising at 3.0% in 2024. Although global inflation is expected to fall from 8.7% to 7% in 2023 and 4.9% in 2024, but will stay above the pre-pandemic levels of about 3.5%. In the United States, easing inflation and positive employment data indicate a more gradual economic slowdown, suggesting a softer landing. On the other hand, the eurozone is expected to experience subdued growth, while the United Kingdom (UK) is anticipated to face a potential technical recession in the near future. Overall, global growth remains uncertain due to many economic and geopolitical factors.

Indian economy

The rate hike by the US Fed caused flooding of capital into the US markets making the US Dollar appreciate against most currencies. This development caused current account deficit (CAD) to widen and increase inflationary pressures in net importing economies like India. The Indian economy, however, seems to have bounced back after the pandemic indicating a near-full recovery in FY22. Yet. the current year has brought the challenge of reining in inflation caused by the European strife for India. Measures taken by the Government and the Reserve Bank of India (RBI), have somehow managed to contain retail inflation below the RBI upper tolerance target in November 2022. However, the challenge of the depreciating rupee persists with the likelihood of further increases in policy rates by the US Fed. The widening of the CAD may continue for some period and the dip in export activities is further possible as the slowing world growth and trade shrinks the global market size in the second half of the current year.

Despite these, agencies worldwide continue to project India as the fastest-growing major economy at a growth rate of 6.5-70% in FY23. These optimistic growth forecasts stem partly from the rebound of private consumption which is back as the leading driver of growth. The uptick in private consumption has also boosted production activity, resulting in increased capacity utilisation across sectors.

The Capital Expenditure (Capex) of the central government, which increased by 63.4% in the first eight months of FY23, was another growth driver of the Indian economy in the current year. A sustained increase in private capex is also imminent with the strengthening of the balance sheets of the corporates and the consequent increase in credit financing it has been able to generate. The much-improved financial health of public sector banks has positioned them better to increase the credit supply.

Indias GDP growth trend (%)

Outlook

As per the Reserve Bank of India (RBI), the Indian economy is forecasted to grow at a rate of 6.5% in the fiscal year 2023-24 (FY24). Growth is expected to be there in FY24 as an aggressive credit disbursal and capital investment cycle is likely to unfold in India with the strengthening of the balance sheets of the corporate and banking sectors. Global growth has been projected to decline in 2023 and is expected to remain generally subdued in the following years. The slowing demand will likely push down global commodity prices and improve Indias CAD in FY24.

Global pharmaceutical industry

According to the IQVIA report, based on invoice price levels, the global medicine market is projected to experience a compound annual growth rate (CAGr) of 3-6% until 2027, resulting in a total market size of $ 1.9 trillion. The growth during this forecast period will be driven by various factors, including the introduction of new products, the impact of patent expiries, and the increasing influence of biosimilars.

In developed markets, players are expected to face budgetary constraints leading to measures aimed at curbing drug spending growth. In Europe, spending is anticipated to increase by $ 59 billion by 2027, focusing on generics and biosimilars.

This development will likely exert additional pressure on novel medicines value and negotiated prices, reflecting the evolving dynamics and priorities within the pharmaceutical industry.

The global pharmaceutical market is projected to have an estimated net cumulative expansion of $ 500 billion from 2020 to 2027. The regions expected to experience the highest volume growth are Latin America, Asia, and Africa because of population growth and increased access to healthcare.

The demand for innovative drugs, particularly in the field of oncology, is set to drive spending to approximately $ 370 billion by 2027, nearly double the current level.

The Global medicine market - using invoice price levels - is expected to grow at 3-6% CAGR through 2027 to about $ 1.9 trillion

Outlook

The ending of Chinas Zero-COVID policy at the beginning of 2023 has provided a boost for pharmaceuticals globally. The reopening of the Chinese economy is helping to reduce strains on global supply chains and, particularly global access to the active pharmaceutical ingredients (APIs) produced in China.

This growth which is anticipated to surpass global volume growth rates will be primarily driven by regions such as Asia- Pacific, India, Latin America, Africa/Middle East, and China. On the other hand, higher-income countries in Western Europe, North America, Japan, and Eastern Europe are expected to experience slower growth ranging from 0.1% to 0.4% through 2027, partly due to their already higher per capita use.

Multiple factors fuel the growth of the global pharmaceutical industry. The growing ageing population in key markets contributes to the increasing demand for healthcare and pharmaceutical products. Additionally, increased purchasing power and access to quality healthcare have allowed more poor and middle-class families worldwide to have greater access to pharmaceuticals. Furthermore, pharmaceutical companies are focusing on tapping into the market for rare and specialty diseases, which has further propelled industry growth.

US pharmaceutical industry

US medicine spending at estimated net manufacturer prices reached $ 629 billion, up 5.3% in 2022, including the contribution of COVID-19 vaccines and therapeutics. Projected data suggests that spending on medicines in the US, considering invoice prices, will experience an increase of $ 134 billion over 2022-27 to $ 763 billion. The surge will be driven by the introduction of new brands and higher pricing.

US medicine spending and growth at invoice-level and estimated net 2013-27

The industry faced notable pricing challenges during the COVID-19 pandemic, mainly due to raw material shortages caused by Chinas shutdown. Moreover, the recent geopolitical instability stemming from the Russia-Ukraine war resulted in increased energy and logistical costs, further impeding business operations. However, as the situation gradually improves, these challenges are expected to diminish, allowing the industry to regain stability. The gradual resolution of these issues will likely create a more favourable environment for pharmaceutical companies, enabling them to overcome pricing challenges and resume normal operations.

Outlook

The utilisation and spending on medicines in the United States are anticipated to return to pre-pandemic growth projections by 2024. However, new pricing policies will introduce additional pressures on net growth in the following years. Various factors, such as structural market dynamics, complex usage patterns, and competitive forces, influence this outlook. Additionally, the effects of new policies and legislation will contribute to the overall landscape of the pharmaceutical market.

Pharmerging markets

The pharmerging market spending witnessed substantial expansion, hitting the mark of $ 370.8 billion in 2022, with a compounded annual growth rate (CAGR) of 7.2% from

2018 to 2022. The growth in these markets will be driven by the expansion of healthcare accessibility across numerous countries and augmented investment in novel medications. Nevertheless, the proliferation of off-patent branded drugs and the competitive pricing of generic medicines might have an influence on the growth trajectory. According to IQVIA, it is anticipated that the pharmerging markets will experience a spending increase of 5-8% until 2027.

The Asia-Pacific will show the most significant growth rates in the global pharmaceutical industry over the next few years. Much of this growth will be driven by increased demand in emerging economies as healthcare systems improve and household incomes expand. Pharmaceutical production and sales will grow by more than 5% year-on-year in 2023 and more than 6% in 2024 and 2025, respectively. In addition, the Asia-Pacifics share of global pharma production will increase from 36% in 2022 to 42% in 2030. Chinas share of global production will grow from 25% in 2022 to 30% in 2030.

Issues related to intellectual property (IP) protection, sociopolitical factors in cross-geography transactions, and strict price controls can result in value erosion and impede market growth. However, despite these challenges, there are opportunities for growth in emerging markets. Additionally, a positive outlook towards adopting targeted therapies could catalyse future market expansion.

Indian pharmaceutical market

According to a recent EY FICCI report, the Indian pharmaceutical market is expected to reach $ 130 billion in value by the end of 2030, as there has been a growing consensus on providing new innovative therapies to patients.

The Indian pharmaceutical sector holds a significant position in the global market, with Indian companies playing a crucial role in producing APIs and formulations. India has emerged as a major player in the pharmaceutical sector, both in manufacturing and export. The Indian pharmaceutical industry is the largest provider of generic medicines globally, with a 20% share in the global supply by volume and is also the leading vaccine manufacturer.

Growth enablers

• Consistent economic development and rapid urbanisation

• Improved affordability in metropolitan and Tier-I cities

• Increasing access to modern medicines

• Changing lifestyles and consumption patterns leading to increasing incidence of chronic ailments

• Higher uptake of innovative medicines

• Rising health awareness among the masses

• Greater demand for insurance coverage, boosted by government and private insurer initiatives

The Indian government has already implemented initiatives such as the Production Linked Incentive (PLI) schemes, medical devices, and bulk drug parks to boost domestic production of APIs, biopharmaceuticals, complex generics, patented drugs, making India a global manufacturing hub.

Outlook

The Indian pharmaceutical industry has played a pivotal role in enhancing healthcare outcomes and driving economic progress in the country. According to IQVIA, the industry continues to experience growth in terms of volume, with a focus on cost- effective generic medicines. The projected increase in spending is estimated to be between $ 35 billion and $ 39 billion and is expected to grow at a rate of 7.5% to 10.5% through 2027. The rising prevalence of non-communicable diseases (NCDs) and the demand for acute therapies will drive this growth. Furthermore, improvements in the drug registration process will make India an attractive destination for the early launch of innovative drugs. The expanding e-pharmacy sector, the introduction of new over-the-counter (OTC) regulations and the expansion of co-marketing agreements will also contribute to the industrys growth.

Crop health science

According to Research and Markets, the global market for crop protection chemicals is projected to reach a value of $ 66.7 billion by 2030. This market is anticipated to grow at a CAGR of 5.6% from 2023 to 2030. The market expansion is attributable to several factors, such as the growing adoption of advanced farming technologies, which has increased demand for crop protection chemicals. Farmers increasingly recognise the importance of protecting their crops from pests, diseases, and weeds to ensure higher yield and improved crop quality. Additionally, there is a rising awareness about the benefits of crop protection chemicals among farmers and agricultural stakeholders. They understand the significance of using these chemicals to safeguard crops and maximise productivity. The need for bio-based and environmentally friendly solutions is driving the development and adoption of biopesticides and other bio-based crop protection products.

India holds a significant position in the global supply chain, and the government has acknowledged the potential of agrochemicals as a key pillar of its economy. The crop protection industry in India is increasingly leveraging its research and development (r&d) capabilities to develop improved solutions that are safer, more efficient, and compliant with international standards. The market is primarily driven by factors such as increasing awareness among farmers regarding crop protection chemicals, the $ 66.7 billion

CROP PROTECTION CHEMICALS MARKET SIZE BY 2030

adoption of modern farming practices, and the growing demand for food security. Insecticides and fungicides are the two largest segments in the Indian crop protection market, accounting for approximately 60% of the market share. With the governments emphasis on sustainable agriculture, the industry strives to develop and promote safer and more environmentally conscious crop protection solutions.

Outlook

Crop protection chemicals have become increasingly important in recent years, driven by the need to enhance productivity and ensure sufficient food supply for the growing global population. There is an increasing emphasis on improving the efficiency of crop protection chemicals in terms of their application. These factors are expected to have a significant impact on the growth of the market. The focus on improving efficiency will drive the development of more advanced and effective products, while government initiatives will create a favourable environment for the widespread adoption of these chemicals.

Company overview

Leveraging its extensive experience spanning nearly four decades, NATCO has established itself as a leading player in the manufacturing and marketing of finished dosage formulations (FDFs). This is supported by a strong backward integration of active pharmaceutical ingredients (APIs).

NATCO has demonstrated remarkable proficiency in targeting complex generic products and successfully introducing them to the market at affordable prices. This proficiency applies to patients not only in India but also in the United States (US) and other geographies. The Companys commitment to providing accessible healthcare solutions has contributed to its success and reputation as a reliable provider of high-quality generic medications.

NATCO operates five pharmaceutical formulation facilities, with one located in Dehradun (Uttarakhand), one in Kothur (Mahboobnagar, Telangana), one in Nagarjuna Sagar (Nalgonda District, Telangana), one in Visakhapatnam (Andhra Pradesh), and one in Guwahati (Assam). The Company also has two API and API intermediates manufacturing units in Mekaguda, Telangana, and Manali, Chennai. Furthermore, NATCO has dedicated R&D centers, namely NATCO Research Centre (NRC), situated in Sanathnagar, Hyderabad and Kothur (Telangana). These R&D facilities form the basis for continuous business excellence and innovation. Regarding NATCOs agrochemical manufacturing operations, they are housed in two facilities, one each for formulation and technical located in Attivaram, Andhra Pradesh. These facilities play a crucial role in supporting NATCOs agrochemical business segment.

Business segments

NATCO operates in two distinct business segments, namely pharmaceuticals and agrochemicals. The pharmaceutical segment is a well-established business and serves as a significant revenue contributor for the Company. This segment has two key components: finished dosage forms (FDFs) and active pharmaceutical ingredients (APIs). The API business holds a strategic position, fulfilling both the internal demand for essential molecules and direct sales to customers.

Furthermore, the Companys formulation business remains dedicated to catering to domestic demand and the needs of international customers across various markets, including the United States, Europe, Brazil, Canada, and the Philippines. The R&D team consistently expands its therapeutic offerings. With a strong pipeline of drugs focusing on areas such as cancer, pharmaceutical specialties, cardiology, and diabetology, the Companys potential for business growth remains promising.

The Companys Crop Health Sciences division is expected to grow with the launch of high-value CTPR and its combinations and more such innovative products along with their combinations are in the pipeline in India.

Pharmaceuticals

Domestic formulations

NATCO possesses a resilient formulation business that encompasses a robust pipeline of products, both in the oncology and non-oncology categories. The Company boasts a specialised sales force comprising 650 professionals, along with an extensive network of over 900 distributors, enabling effective market penetration. The Company established the NATCO Reach division comprising of a dedicated sales team focused on deeper geographical penetration strategies, thus, gaining wider access to general physicians. NATCO has diligently worked towards addressing unmet needs in untapped markets, minimising the impact of contraction, and maintaining a strong focus on expansion.

Domestic Formulation Sales⁽¹⁾ ( in million)

FY numbers have been prepared under Ind AS (1) Represents gross revenue

Oncology

Despite facing challenges, oncology remains the primary contributor to domestic sales and revenue for NATCO. The Companys strong market presence and trustworthiness have been upheld, particularly in the oncology segment. NATCO has significantly expanded its product range from 6 in 2003 to 54 as of March 31, 2023, establishing a portfolio of well- recognised brands. Over the past decade, the global usage of oncology medicines has experienced substantial growth. In the reviewed year, NATCO expanded the range of offerings in the targeted therapeutic segment, allowing the Company to venture into new disease segments with the latest novel therapies, positively impacting more patients lives.

Oncology Sales ( in million)

Pharma Specialty

NATCOs non-oncology business comprises pharmaceutical specialty therapeutics in areas such as, gastroenterology, hepatology, orthopaedics, neurology, critical care, cardiology, and diabetology products. The Company is committed to investing in the development and introduction of new compounds that address unmet needs in Gastro and antiinfective treatments. Specifically, in the pharma specialty space, NATCO aims to enhance its product range by launching molecules for anti-infective therapies, thereby strengthening its presence in this area.

Cardiology & Diabetology

The cardiology and diabetology segments portfolio comprises a select yet powerful range of products. We have enhanced the portfolio by introducing novel products in the areas of anticoagulants, anti-diabetic medications, antihypertensives, and therapies for metabolic disorders. Our aim is to expand the market for this division by reaching a broader network of doctors, with a particular emphasis on our NATCO Reach division.

Non-Oncology Revenue ( in million)

Export formulations

NATCO has established a formidable presence in the United States and possesses extensive expertise in navigating the countrys regulatory standards. The Company has effectively established a local presence through its partners, ensuring sustained business growth. Additionally, NATCO operates in various countries, including the US, Brazil, Canada, Singapore, Australia, and Philippines, through its subsidiaries and step- down subsidiaries. In Canada, the Company boasts a strong product portfolio encompassing oncology, cardiovascular, and central nervous system (cns) therapies. In Brazil, NATCO is expanding its offerings by introducing high-potential generic products, enhancing its revenue and profitability. Revenue from export formulations amounted to 20,632 million in FY2022-23, compared to 11,842 million in FY 2021-22.

Export Formulations Revenue ( in million)

The US is a crucial market for NATCO, and it has carved out a niche by using its unique product range and local collaboration approach. NATCO intends to expand the number of filings in the United States. The Company focuses on products with high barriers to entry, which have difficult chemistries, complex production processes or novel drug delivery methods. The Companys strategy is reflected in its high percentage of molecules in the US as First-to-file (FTF).

In FY 2022-23, revenue from US business was 16,060 million, as compared to Rs 9,782 million in FY 2021-22. During the year, we filed nine ANDAs. The Company continues to develop and file strong Para IV products with potential First-to-file (FTF) launches in the US. Through acquiring Dash Pharmaceuticals LLC, now renamed as NATCO Pharma USA LLC, we have successfully established a front-end presence in the US market. This acquisition gives NATCO a platform to directly engage with its customers in the United States for its future portfolio.

Niche products in current portfolio

Key Brand	Molecule	Therapeutic segment
Revlimid	Lenalidomide	Cancer/Multiple myeloma
Copaxone	Glatiramer Acetate	CNS/Multiple sclerosis
Tamiflu	Oseltamivir	Anti-viral/Influenza
Afinitor (2.5 mg, 5 mg, 7.5 mg, and 10 mg)	Everolimus (higher strength)	Cancer/Breast
Fosrenol	Lanthanum Carbonate	Renal disease
Doxil	Liposomal Doxorubicin	Cancer/Ovarian and other
Tykerb	Lapatinib Ditosylate	Cancer/Breast
Zortress	Everolimus (lower strength)	Immunosuppressant/Organ transplant

Key products in the pipeline

Key Brand	Molecule	Therapeutic segment
Eliquis	Apixaban	Anticoagulant
Ozempic	Semaglutide	Diabetes
Lynparza	Olaparib	Ovarian/Breast cancer
Kyprolis	Carfilzomib	Cancer/Multiple myeloma
Imbruvica	Ibrutinib	Cancer/Leukaemia
Pomalyst	Pomalidomide	Cancer/ Multiple myeloma
Lonsurf	Trifluridine/Tipracil	Metastatic colorectal cancer
Yondelis	Trabectedin	Advanced soft-tissue sarcoma/ovarian cancer
Calquence	Acalabrutinib	Cancer/Blood
Zydelig	Idelalisib	Cancer

Canada

Natco Pharma (Canada) Inc reported revenue of 2,697 million in FY 2022-23 as compared to 1,526 million in the previous fiscal year. The Company launched the first generic of Nat-Pomalidomide, Nat-Apixaban, and Nat-Teriflunomide in the market in the year. With 35 approvals in place, the Company has a strong foothold in the Canadian pharmaceutical market.

Asian and other emerging markets

NATCO is actively pursuing a strategy to expand its geographical footprint and strengthen its presence in several countries, including Singapore, Taiwan, Philippines, Thailand, Vietnam, China, and Australia. The Company aims to ensure sustainable profitability and growth by venturing into these new markets. Notably, NATCO has made significant progress in Singapore, establishing its presence in both tender and private segments through branded generics and securing approvals for products. In a significant milestone, the Company successfully launched Oseltamivir capsules in the Chinese market, thus, marking NATCOs entry into this territory. Furthermore, as part of its growth and profitability enhancement strategy, NATCO has decided to establish a subsidiary in Indonesia, reflecting its commitment to exploring new markets and expanding its reach.

I Brazil

Natcofarma Do Brasil Ltda. is a fully-owned NATCO subsidiary in Brazil. The Company is generating business majorly through its tender-based business and direct sales channels. In the past year, NATCOFARMA successfully launched Apixaban, marking one of the most successful launches through its own sales and out- licensing efforts. Additionally, the Company continues to pursue approvals for high-potential products soon. In FY 2022-23, the business revenue in Brazil reached Rs 1,339 million, reflecting the Companys growth and presence in the market.

API division

The API division remains a crucial strategic division for NATCO, primarily supporting the production of specialised formulated products. To ensure sustained growth in this segment, NATCO is committed to filing new drug master files (DMFs) annually.

In the past year, the Company filed two new DMFs. As of 31^st March 2023, NATCO possesses 44 active DMFs with the USFDA for oncology, cardiology, and CNS products. API revenues amounted to 2,103 million, compared to 2,481 million in the previous year.

API Revenues ( in million)

Segmental Breakdown

Revenue division (in Rs million)	FY 2018-19	FY 2019-20	FY 2020-21	FY 2021-22 ?	FY 2022-23
API revenues (total)	3,019	3,552	5,120	2,481	2,103
Formulations
Domestic	7,347	5,405	4,101	4,771	3,749
International (including subsidiaries)	9,933	9,334	10,771	11,842	20,632
Crop health sciences	-	-	21	51	409
Other operating and non-operating incomes	1,948	1,933	1,544	1,293	1,224
Total revenues	22,247	20,224	21,557	20,438	28,117

CHS division

NATCOs crop health sciences (CHS) division was established by leveraging the Companys core pharmaceutical expertise in chemistry, patent knowledge, and a strong commitment to quality. Building on these capabilities, NATCO CHS has made significant strides in recent years by establishing cutting- edge greenfield manufacturing facilities for manufacturing technical and formulations at Attivaram, Andhra Pradesh.

During the year, we successfully launched Chlorantraniliprole (CTPR)- based products, which are broad-spectrum insecticides, across key agricultural states in India. Furthermore, we introduced the first pheromone-based mating disruption product for managing the pink bollworm pest in cotton.

Looking ahead, our focus will be on developing niche molecules to serve both the Indian and international markets. This strategic direction will enable us to offer specialised solutions and cater to wider agricultural needs while leveraging our expertise and expanding our presence in the crop health sciences industry.

Financial overview

NATCOs consolidated revenue from operations for the year stood at 28,117 million for FY 2022-23 as compared to 20,438 for FY 2021-22. EBITDA for FY 2022-23 stood at Rs 10,402 million at 37% of revenue. PAT amounts to Rs 7,153 million for FY 2022-23 at 25.4% of revenue against Rs 1,700 for FY 2021-22.

The Companys market capitalisation stood at $ 1.25 billion as on 31^st March 2023. The Company issued three dividends at a total of 5.5 per share, which amounted to 1,004 million. The dividend payout stood at 15.76% of the standalone profit.

Threats, risks, and concerns

Our risk management systems are robust with a well-defined framework, that is governed by the Board and management. Our risk management framework seeks to balance shareholder expectations for risk-adjusted returns.

Read more on our risk management on page 40