dr lal pathlabs ltd share price Directors report


Dear Members,

Your Directors have pleasure in presenting the 29th Annual Report on the business and operations of your Company along with the audited statement of accounts for the financial year ended March 31, 2023.

FINANCIAL RESULTS

The Financial performance of your Company for the year ended March 31, 2023 is summarized below:

(H in Million)

  Consolidated Standalone

Particulars

Year ended March 31, 2023 Year ended March 31, 2022 Year ended March 31, 2023 Year ended March 31, 2022
Total Income 20,586 21,400 18,156 19,319
Total Expenses 17,148 16,650 14,248 14,709
Profit/(Loss) before Tax (PBT) 3,438 4,750 3,908 4,610
Profit/(Loss) after Tax (PAT) 2,411 3,503 2,924 3,453

These numbers have been restated pursuant to approval of Scheme of Amalgamation of APL Institute of Clinical Laboratory & Research Private Limited with the Company.

FINANCIAL PERFORMANCE

I. C ONSOLIDATED PERFORMANCE

During the FY 2022-2023, the Company reported a Consolidated Total Income of H 20,586 Million compared to H 21,400 Million in the previous year. The Consolidated Net Profit After Tax of the Company stood at H 2,411 Million compared to H 3,503 Million in the previous year.

II. STANDALONE PERFORMANCE

During the FY 2022-2023, the Company reported a Standalone Total Income of H 18,156 Million compared to H19,319 Million in the previous year. The Standalone Net Profit After Tax of the Company stood at H 2,924 Million compared to H 3,453 Million in the previous year.

CONSOLIDATED ACCOUNTS

The consolidated financial statements of your Company for the Financial Year 2022-23, are prepared in compliance with applicable provisions of the Companies Act, 2013 (‘the Act"), Indian Accounting Standards ("Ind-AS") and Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"). The consolidated financial statements have been prepared on the basis of audited financial statements of the Company and its Subsidiaries, as approved by their respective Board of Directors.

DIVIDEND

During the year under review, your Company paid dividends as under:

Date of Declaration

Dividend Type Financial Year Dividend Per Share (face value of Rs10/- each)

June 30, 2022

Final Dividend 2021-22 Rs 6/-

July 28, 2022

Interim Dividend 2022-23 Rs 6/-

In addition, your Directors are pleased to recommend dividend of H 6/- per equity share of face value of H 10/- each as Final Dividend for the Financial Year 2022-23, for approval by the shareholders at the ensuing Annual General Meeting ("AGM") of the Company.

The Dividend Distribution Policy of the Company is attached herewith as Annexure-1 and forms an integral part of this Annual Report. The said policy is also available on the website of the Company at: https://uat-cdn.drlallab.com/2023-06/ Dividend-Distribution-Policy.pdf

TRANSFER TO RESERVES

During the year under review, no amount has been transferred to the General Reserve of the Company from current year profits.

AMALGAMATION

The Board of Directors of your Company in their meeting on February 03, 2020, approved a Scheme of Amalgamation ("the Scheme") between Dr. Lal PathLabs Limited (the Company/Transferee Company) and APL Institute of Clinical Laboratory & Research Private Limited, a wholly owned subsidiary of the Company (APL/ Transferor Company), having its Registered Office in Ahmedabad, subject to requisite approvals under Section 230 to 232 of the Companies Act, 2013 ("the Act").

The Scheme was sanctioned by New Delhi and Ahmedabad Bench of Honble National Company Law Tribunal (NCLT) on May 13, 2022 and March 17, 2023 respectively.

The certified true copies of the Order(s) of New Delhi and Ahmedabad Bench of Honble NCLT were filed with respective Registrar of Companies - Delhi and Registrar of Companies - Ahmedabad on June 8, 2022 and March 27, 2023, respectively and consequent upon that APL stands amalgamated with the Company w.e.f March 27, 2023 (being the effective date). Pursuant thereto and in accordance with the terms of the Scheme, APL gets amalgamated with the Company w.e.f. April 1, 2020 (being the appointed date) and consequently stands dissolved without being wound-up.

CHANGE IN SHARE CAPITAL

Authorized Share Capital

During the year under review, the authorized share capital of the Company has been increased from H 1,07,95,00,000/- divided into 10,79,50,000 equity shares of H 10/- each to H 1,07,96,00,000/- divided into 10,79,60,000 equity shares of H 10/-each, by virtue of the NCLTs Order(s) passed for sanctioning the Scheme of Amalgamation of APL Institute of Clinical Laboratory & Research Private Limited with the Company.

Paid-up Share Capital

During the year under review, the paid-up equity share capital of the Company has been increased from H 83,34,48,770/- divided into 8,33,44,877 equity shares of H 10/- each to H 83,36,78,770/- divided into 8,33,67,877 equity shares of H10/- each pursuant to allotment of Equity Shares under the Employee Stock Option Plan 2010 of the Company as detailed below:

Date of Allotment

Number of Equity Shares allotted
1. May 06, 2022 7,000
2. January 03, 2023 2,000
3. February 22, 2023 14,000

TOTAL

23,000

Further, after the closing of financial year 2022-23 the paid-up equity share capital of the Company has also been increased from H 83,36,78,770/- divided into 8,33,67,877 equity shares of H 10/- each to H 83,41,48,770/- divided into H 8,34,14,877 equity shares of H 10/- each pursuant to allotment of Equity Shares under the Employee Stock Option Plan 2010 of the Company as detailed below:

Date of Allotment

Number of Equity Shares allotted
1. April 12, 2023 16,000
2. May 19, 2023 25,000
3. July 13, 2023 6,000

TOTAL

47,000

These Equity Shares are rank pari passu with the existing Equity Shares of the Company in all respects. During the year under review, your Company has not issued any Equity Share with differential rights, Sweat Equity Shares or Bonus Shares.

EMPLOYEES STOCK OPTION PLAN / SCHEME

During the year under review, the Shareholders of the Company in their 28th Annual General Meeting held on June 30, 2022 approved Dr. Lal PathLabs Employee Stock Option Plan, 2022 ("ESOP Plan, 2022").

Further, there has been no material change in the existing ESOP Plans of the Company viz. (i) Employee Stock Option Plan, 2010, (ii) Employee Restricted Stock Unit Plan, 2016 and (iii) Employee Stock Option Plan, 2022 and these Plans have been implemented in compliance with relevant/ applicable ESOP Regulations/ Guidelines. The disclosure(s) as required under the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 are disclosed on the website of the Company and can be accessed at https://uat-cdn.drlallab.com/2023-08/Information-as-per-SEBI-(SBEB)-Regulations-FY23.pdf

SUBSIDIARIES

A report on the performance and financial position of each of the subsidiaries and their contribution to the overall performance of the Company for the financial year ended March 31, 2023 in Form AOC -1 as per the Companies Act, 2013 is attached herewith as Annexure-2 and forms an integral part of this Annual Report.

The annual accounts of the each of the subsidiaries shall also be made available to the Shareholders of the Company/ Subsidiary Companies seeking such information at any point of time. The annual accounts of the Subsidiary Companies are also available under investors section on the website of the Company at www.lalpathlabs.com

The Company has formulated a policy for determining material subsidiaries. The said policy is also available on the website of the Company at: https://uat-cdn. drlallab.com/2023-06/Policy-for-determining-Material-Subsidiaries.pdf

TRANSFER OF UN-CLAIMED IPO SHARE APPLICATION MONEY TO IEPF

During the year under review, pursuant to the provisions of Section 125 of the Companies Act, 2013 read with Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, as amended from time to time, your Company has duly transferred Unclaimed IPO Share Application Money of H 12,59,200 (Rupees Twelve Lakh Fifty Nine Thousand Two Hundred only) to Investor Education and Protection Fund (IEPF) Account of Central Government.

The Claimant(s), whose unclaimed amount has been transferred by the Company to IEPF Account may claim their amount by complying with the procedure stipulated in the IEPF Rules.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

No material changes and commitments, other than disclosed as part of this report, affecting the financial position of the Company have occurred between March 31, 2023 and the date of the report.

PUBLIC DEPOSITS

During the year under review, your Company has not accepted any deposit within the meaning of Section 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided in the prescribed format and annexed herewith as Annexure-3 and forms an integral part of this Annual Report.

Particulars of employee remuneration, as required under Section 197 (12) of the Companies Act, 2013 read with Rule 5 (2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms an integral part of this Annual Report. In terms of the provisions of the first proviso to Section 136 (1) of the Companies Act, 2013, the Annual Report is being sent to Shareholders, excluding the aforementioned information. Any Shareholder interested in obtaining a copy of such statement may write to the Company Secretary of the Company at cs@lalpathlabs.com.

AUDIT COMMITTEE

The composition of Audit Committee has been detailed in the Corporate Governance Report, forming part of this Annual Report. All recommendations made by the Audit Committee have been accepted by the Board of Directors.

DIRECTORS

I. Retir ement by rotation and subsequent appointment

Mr. Rahul Sharma (DIN: 00956625), Non-Executive Director of the Company is liable to retire by rotation at the ensuing Annual General Meeting ("AGM") pursuant to the provisions of Section 152 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and being eligible offers himself for re-appointment. Appropriate resolution for his reappointment is being placed for the approval by the Shareholders of the Company at the ensuing AGM. A brief profile of Mr. Rahul Sharma and other related information is detailed in the Notice convening the 29th AGM of your Company.

The Board considered the said re-appointment in the interest of the Company and hence recommends the same to the Shareholders for approval.

II. Appointment

The tenure of majority of the Independent Directors on the Board of the Company shall be coming to an end by August, 2023. In order to ensure smooth transition at the Board Level, the Board of Directors on recommendation of Nomination & Remuneration Committee and after evaluating balance of skills, knowledge and experience available on the Board, approved, the appointment of: i. Mr. Rohit Bhasin (DIN: 02478962) as an Additional Director in the category of Independent Director, not liable to retire by rotation for a term of three (3) consecutive years beginning from November 8, 2022. ii. Mr. Arun Duggal (DIN: 00024262) as an Additional Director in the category of Independent Director, not liable to retire by rotation for a term of three (3) consecutive years beginning from February 2, 2023. Further, the Shareholders of the Company by way of Postal Ballot(s), approved the appointment of Mr. Rohit Bhasin and Mr.

Arun Duggal as Independent Directors of the Company on December 14, 2022 and March 10, 2023 respectively. iii Mr. Gurinder Singh Kalra (DIN: 10197218) and Mr. Rajit Mehta (DIN: 01604819) appointed as Additional Directors in the category of Independent Directors not liable to retire by rotation for a term of three (3) consecutive years beginning from July 27, 2023, subject to the approval of Shareholders at the ensuing Annual General Meeting.

III. Declaration of Independence from Independent

Directors

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under Section 149 of the Companies Act, 2013 and Rules made thereunder read with Schedule IV as well as the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In the opinion of the Board, all the Independent Directors fulfil the criteria of independence as specified in Companies Act, 2013 and Rules made thereunder read with Schedule IV as well as Regulation 25 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and they are independent from the Management. Further, all the directors including Independent Directors of the Company possess appropriate skills, experience & knowledge in one or more fields viz. Board & Governance, Finance, Accounting & Finance Reporting, Information Technology and Specialized Industry & environmental knowledge or other disciplines related to Companys business.

KEY MANAGERIAL PERSONNEL

In accordance with the provisions of Section 2(51) and 203 of the Companies Act, 2013 read with Rules made thereunder, the following were the Key Managerial Personnel (KMPs) of the Company as on March 31, 2023:

1. (Hony) Brig. Dr. Arvind Lal – Executive Chairman

2. Dr. Om Prakash Manchanda – Managing Director

3. Dr. Vandana Lal – Whole Time Director

4. Mr. Bharath U - Chief Executive Officer

5. Mr. Ved Prakash Goel – Group Chief Financial Officer; and

6. Mr. Rajat Kalra - Company Secretary and Legal Head

Mr. Rajat Kalra, resigned as Company Secretary and Legal Head of the Company w.e.f. March 31, 2023 (closing of business hours).

Basis the recommendation of Nomination & Remuneration Committee, the Board of Directors appointed Mr. Vinay Gujral as Company Secretary (KMP) of the Company w.e.f May 11, 2023.

ANNUAL EVALUATION OF BOARDS PERFORMANCE

Pursuant to the provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board have carried out annual evaluation of

(i) its own performance;

(ii) Performance of Individual Directors;

(iii) Performance of Chairman of the Board; and

(iv) Performance of all the Committees of the Board for the Financial Year 2022-23. A structured questionnaire was prepared covering various aspects of the Boards functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance. A separate exercise was carried out to evaluate the performance of individual Directors, who were evaluated on parameters such as level of engagement and contribution, independence of judgment, safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Non-Independent Directors and Chairman of the Board was carried out by the Independent Directors taking into account the views of Executive Directors and Non-Executive Directors.

The Directors expressed their satisfaction with the evaluation process.

Further, the evaluation process confirms that the Board and its Committees continue to operate effectively and the performance of the Directors and the Chair is satisfactory.

NOMINATION & REMUNERATION POLICY

In compliance with the provision of Section 178 of the Companies Act, 2013 and Rules made thereunder, the Board has on the recommendation of the Nomination & Remuneration Committee of the Company, framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management Personnel and their remuneration.

The Nomination and Remuneration Policy as updated from time to time is attached herewith as Annexure -4 and forms an integral part of this Annual Report and the same can also be accessed at the website of the Company at: https://uat-cdn.drlallab.com/2023-06/Nomination-and-Remuneration-Policy.pdf

NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES

The Board met Four (4) times during the Financial Year 2022-23. The details of the meeting of the Board and its Committees thereof are given in the Corporate Governance Report, which forms an integral part of this Annual Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 (3)(c) of the Companies Act, 2013, the Directors confirm that: a) in the preparation of the annual accounts for the Financial Year ended March 31, 2023, the applicable accounting standards and Schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same; b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at March 31, 2023 and of the profit/loss of the Company for the Financial Year ended March 31, 2023; c) proper and sufficient care has been taken by the Directors 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 annual accounts have been prepared on a ‘going concern basis by the Directors; e) proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and were operating effectively; and f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

AUDITORS AND AUDITORS REPORT

I. Statutory Auditors

The Shareholders of the Company in their 28th Annual General Meeting (AGM) held on June 30, 2022, re-appointed M/s. Deloitte Haskins & Sells LLP., Chartered Accountants, (Firm Registration No. 117366W/W100018) as the Statutory Auditors of the Company to hold office for their second term of five (5) year(s) i.e. from the conclusion of 28th AGM till the conclusion of 33rd AGM of the Company, to be held in calendar year 2027.

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, Statutory Auditors have confirmed that they have not been disqualified to act as Statutory Auditors of the Company and that their continuation is within the ceiling limit as prescribed under section 141 of the Companies Act, 2013 and/ or other relevant statue.

Further, the Statutory Auditors of the Company have not reported any fraud as specified under the second proviso of Section 143(12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) for the time being in force). The Auditors Report for the Financial Year ended

March 31, 2023, does not contain any qualification, reservation or adverse remark.

The Auditors Report being self-explanatory does not call for any further comments from the Board of Directors.

II. Cost Auditors

In terms of the Section 148 of the Companies Act, 2013 read with Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost accounting records and get them audited every year. Accordingly, such accounts and records were made and maintained for the Financial Year 2022-23.

The Board of Directors on the recommendations of the Audit Committee has appointed M/s A.G. Agarwal & Associates, Cost and Management Accountants, as Cost Auditors of the Company for the Financial Year 2023-24 at a fee of H 1,00,000/- (Rupees One Lakh Only) plus applicable taxes and out of pocket expenses subject to the ratification of the said fees by the Shareholders at the ensuing AGM.

III. Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Company had appointed M/s PDS & Co., Company Secretaries ("Secretarial Auditors") to conduct the Secretarial Audit of the Company for the Financial Year 2022-23.

The Secretarial Audit Report for the Financial Year ended March 31, 2023 is attached herewith as Annexure-5 and forms an integral part of this Annual Report. The Secretarial Audit Report is self explanatory and does not contain any qualification, reservation or adverse remark. In compliance with the requirements of SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, Secretarial Audit Report of Material Wholly Owned Subsidiary Company viz. Suburban Diagnostics (India) Private Limited is also attached herewith as Annexure-6 and forms an integral part of this Annual Report. The Secretarial Audit Report of Suburban Diagnostics (India) Private Limited is self-explanatory and does not contain any qualification, reservation or adverse remark.

ANNUAL RETURN

The Annual Return of the Company in Form MGT- 7 in accordance with Section 92(3) of the Companies Act, 2013 is available on the website of the Company at https://uat-cdn.drlallab.com/2023-08/MGT-7-Annual-Return-2022-23.pdf

RELATED PARTY TRANSACTIONS

In compliance with the requirements of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has formulated a Policy on Related Party Transactions which is available on Companys website at https://uat-cdn.drlallab.com/2023-06/Policy-on-Related-Party-Transactions.pdf The Policy intends to ensure that proper reporting, approval and disclosure processes are in place for all transactions between the Company and its Related Parties. All Related Party Transactions are placed before the Audit Committee for review and approval. Prior omnibus approval is obtained for Related Party Transactions which are of repetitive nature and / or entered in the Ordinary Course of Business and are at Arms Length. All related party transaction entered during the year were in Ordinary Course of the Business and on Arms Length basis. No Material Related Party Transaction as per the limits specified under Companies Act, 2013 and/ or SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, was entered during the year under review by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.

LOANS, GUARANTEES AND INVESTMENTS

In terms of the provisions of section 186 of the Companies Act, 2013 read with Companies (Meeting of Board and its Powers) Rules, 2014 and Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, details of Investments are set out at Note No. 6 to the Standalone Financial Statements of the Company.

During the year under review, the Company has not given any loan or provided any guarantees pursuant to Section 186 of the Companies Act, 2013.

RISK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed to manage the risks in a proactive and efficient manner. Your Company periodically assesses risk elements in the internal and external environment and incorporates risk treatment plans in its strategy, business and operational plans. Your Company, through its Risk Management Policy, strives to contain impact and likelihood of the risks within the risk appetite as agreed from time to time with the Board of Directors. The Company has a Risk Management Committee to identify elements of risk in different areas of operations; the details of the Risk Management Committee are included in the Corporate Governance Report.

WHISTLE BLOWER MECHANISM

Your Company has a Whistle Blower Mechanism in place as required under Section 177 of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015. More details in this regard have been outlined in the Corporate Governance Report annexed to this report and are also available under Investors Section on the Companys website at: www.lalpathlabs.com

CORPORATE SOCIAL RESPONSIBILITY

For your Company, Corporate Social Responsibility (CSR) means the integration of social, environmental and economic concerns in its business operations. CSR involves operating Companys business in a manner that meets or exceeds the ethical, legal, commercial and public expectations. In alignment with vision of the Company, through its CSR initiative, your Company will enhance value creation in the society through its services, conduct and initiatives, so as to promote sustained growth for the society.

The Board of Directors of your Company has formulated and adopted a policy on CSR which can be accessed at: https://uat-cdn.drlallab.com/2023-06/CSR-Policy.pdf The CSR Policy of your Company outlines the Companys philosophy for undertaking socially useful programs through the creation of a CSR Trust for welfare and sustainable development of the community at large as part of its duties as a responsible corporate citizen. The composition of CSR committee, details of Unspent amount transferred to Unspent CSR Account along with reason thereof and the disclosures as per Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 as amended are provided in the "Annual Report on CSR Activities" attached herewith as Annexure-7 and forms an integral part of this Annual Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Management Discussion and Analysis (‘MDA) Report gives details of the overall industry structure, developments, performance and state of affairs of the Companys business and other material developments during the Financial Year. The MDA report for the Financial Year 2022-23 is attached herewith as Annexure- 8 and forms an integral part of this Annual Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Business Responsibility and Sustainability Report (BRSR) for Financial Year 2022-23 is attached herewith as Annexure-9 and forms an integral part of this Annual Report.

CORPORATE GOVERNANCE REPORT

In compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a separate report on Corporate Governance for the Financial Year 2022-23 along with a certificate from the Practicing Company Secretary on its compliance, is attached herewith as Annexure-10 and forms an integral part of this Annual Report.

DISCLOSURE UNDER THE SEXUAL HARASSMENTOFWOMENATWORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in compliance with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("the POSH Act"). The Company has complied with the provisions relating to the constitution of Internal Complaints Committee (ICC) as specified under the POSH Act.

The Company conducts sessions for employees to build awareness amongst employees about the Policy and the provisions of the POSH Act.

Status of Complaints under the POSH Act during the Financial Year 2022-23 is detailed below:

Particulars

No. of Complaints

Compliant pending at beginning of Financial Year

0

Complaint received during Financial Year

7

Compliant resolved during Financial Year

7

Compliant pending at end of Financial Year

0

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

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014, is set out hereunder:

(A) Conservation of energy

(i) Steps taken or impact on conservation of energy

I. Maintaining power factor (PF) upto .99 (unity). Maintaining upto- 0.9994 at majority of the locations II. Labs/ PSC locations are equipped with LED Lights for saving energy in past years and all new labs are equipped with LED only.

III. Installed R32 refrigerant operated air conditioning systems across the nation, which helps in conserving Ozone layer. IV. Automatic phase sequence corrector panel installed in 22 locations to saving the Diesel consumption.

V. Current installed capacity of solar power plants is 100 KW (50+50) in National Reference Lab, Rohini, Delhi and 10KW in Reference Lab, Kolkata.

VI. De-scaling of Chillers is being done semi-annual for better efficiency & saving the energy VII. RO waste water recycling has helped in saving approx. 36KL of water per day in FY 2022-23, VIII. ETP (Effluent Treatment Plant) installed in all satellite labs for waste water treatment

XII. Energy Consumption Data: throughout the year across the Nation to treat the liquid waste of labs, to keep environment clean.

IX. Equipped all locations with Advance Autoclave by which Temp, Pressure and time are recorded automatically in graph and data. Its as per BMW guidelines. X. 89 E-bikes taken on rent for sample transportation during the FY 2022-23 for home collection and logistics. E-bikes offer a considerable opportunity to cut travel emissions. Switching from a daily car journey to an e-bike can save an average 249g of CO2 for every 1km travelled. XI. 12 locations were D&I accessible during the FY 2022-23, to make work place workable for everyones. moving non-accessibility to accessibility.

  FY 2022-23 FY 2021-22

Parameter

Current Financial Year (MWH) Previous Financial Year (MWH)

Total electricity consumption (A) (Data calculated –Bill@11.5 per unit) (MWH)

16,379 15,271

Total fuel consumption (B) (calculated based on 0 .3 KWH per liter) (MWH)

39 43

Energy consumption through other sources (C) (Solar) (MWH)

113 61

Total energy consumption (A+B+C) (MWH)

16,531 15,375

(ii) Steps taken by the company for utilising alternate sources of energy

The Company had further added solar energy system of 50 KW at its National Reference Lab in Rohini, New Delhi.

(iii) Capital investment on energy conservation equipments

The Company has spent approx. Rs 3.2 Million on installation of solar energy system at its National Reference Lab in Rohini, New Delhi.

(B) Technology absorption

(i) Imported Technologies

Processes / Technologies

Date of Description Import

Absorption Benefits

1. IBEX

IBEX is an Artificial Intelligence November, (AI) enabled software tool 2021 which is used for the diagnosis of the digital images of histopathology / IHC slides. It uses data models to provide the diagnosis.

Fully AI assisted reporting for Prostate cancer and Breast cancer. The cancer heat map and quantification improve accuracy and standardisation of reporting.
 

The vendor is based out of Israel & the tech support is provided to us through European region. Currently the absorption is limited to Prostate cancer & is validated and expected to be rolled out for Breast cancer diagnosis in FY24 qtr2

   

2. AlloSeq analysis software

For Donor Derived cell free June, 2021 DNA (ddcfDNA) analysis for monitoring solid organ transplants

Fully We are first in India to launch this test in the market last year. The test offers a non- invasive monitoring for all solid organ transplants – cardiac, liver, lung, kidney as an alternative to repeated biopsy

3. Leica Pegasus

Leica Pegasus is a tissue March processor with barcode based 2023 tracking mechanism and alcohol concentration monitor

Fully First Installation of this automated system in India. Barcode based tracking of anatomic tissue processing and monitoring of the alcohol concentration for each container with alerts thus ensuring improved tissue processing results.

4. Metafer

Automated metaphase December capturing microscope used for 2022 karyotyping. This system also uses Artificial Intelligence for cytogenetic analysis

Fully High speed scanning of metaphases for automated capture of karyotype for cytogenetic analysis. AI supported analysis of the karyotype supports faster screening and analysis

5. Optrascan

Whole slide digital scanner October with loading capacity of 80 2022 slides in one go.

Fully Telepathology software can help real time remote consultations. Real time auto focus and Z-Stack functions available for cytology smears. Continuous loading and unloading for efficient workflow

(ii) O ther locally sourced Technologies:

RE Owned IP: Dr. Lal PathLabs Ltd. (DLPL) has been a pioneer in introducing newer technologies & newer strategies to run the business operations ever efficiently & consistently improved the service deliveries to its customers. One such latest tech initiative in the long list of tech driven solution is the creation of an in-house AI system for suggestive insights to its customers. The same is being called as Reco.A

I. The said engine is DLPLs own IP & is able to suggest / recommends the customers for relevant tests basis various parameters

i.e. Current health conditions, Past result trends, demographic details, disease categories etc. The data models imbibed & deployed under Reco.AI have been enriched by processing a huge amount of clinical data. PLM: DLPL is committed to offer a full scale Patient Lifecycle management (PLM) for its customers. The aim is to have an enhance customer experience by managing the PLM & on-boarding the customers on the transition of mind set of illness to wellness. There are several campaigns & programs created under this PLM where the in depth data analysis & lots of cutting edge technologies like predictive & profiling AI models are being used to help customers in the management of their healthcare. We at DLPL call it Customer health improvement philosophy (‘CHIPs) which aims to simplify patient lives by creating more tech enabled centres of excellence (‘COE) and leveraging digital infrastructure. There has been a majority of influx of technology in the digital infrastructure i.e. Data analytics, Chatbots, AI driven IVRs, One Common registration for POS etc. Logistics Owned IP: One of the important cog in running the DLPL business wheel is the automation in Logistics operations. The automation is of the most significant essence here as the volume & touch points of sample collection is tremendous & simply not possible to manage through manual / conventional means. The technology has again come to front in developing a home grown Logistics automation system. The System is using latest tech stack to manage the sample collection, Sample handover, Tracking of sample movements, fleet management etc. AI driven data models are used for Route optimizations & the image recognition models are used for tube scanning & bagging process. Geo fencing & Secure QR code based hand over process are also included for bringing in overall efficiency in the system.

Medprime – Cilika digital microscope

Medprime, a startup incubated at NASSCOM, has developed a low cost, light weight, smart & connected Microscope, which can be deployed at remote locations. Within seconds, the enhanced images of the hematology peripheral smear slide can be sent digitally to the expert who can examine those for Second opinion. Deployed at 18 remote locations, it has reduced turn-around time of second opinion slides. Also, the images of the samples being sent digitally to the expert has enabled them to do the examination from any place, thereby enabling those in any location to take up the examination of sample sent from anywhere, allowing improvement in operational efficiency.

(C) Expenditure incurred on Research and Development: H 36 Million

(D) Foreign exchange earnings and outgo

  Amount

Particulars

(In Rs Million)
Foreign Exchange Earnings 220.22
Foreign Exchange Outgo 101.37

() It em representing Profit & Loss A/c for the year

INTERNAL FINANCIAL CONTROLS

Your Company has in place an adequate internal financial control framework with reference to financial and operating controls thereby ensuring orderly and efficient conduct of its business, including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records, and timely preparation of reliable financial information.

During Financial Year 2022-23, such controls were tested and no reportable material weakness in the design or operation was observed.

The Directors have in the Directors Responsibility Statement confirmed the same to this effect.

SIGNIFICANT/MATERIAL ORDERS PASSED BY THE REGULATORS

There are no significant/material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of your Company and its operations in future.

CHANGE IN NATURE OF BUSINESS

There was no change in the nature of business of the Company during Financial Year 2022-23.

COMPLIANCE OF SECRETARIAL STANDARDS

The Company has duly complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors (SS-1) and Shareholders (SS-2).

GENERAL DISCLOSURE

During the year under review, there is no application made and/or no proceeding pending under the Insolvency and Bankruptcy Code, 2016.

During the year under review, requirement of disclosing details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof is not applicable on the Company.

APPRECIATION

Your Directors wish to convey their gratitude and place on record their appreciation for all the employees at all levels for their hard work, solidarity, cooperation and dedication during the year. Your Directors sincerely convey their appreciation to customers, shareholders, vendors, bankers, business associates, regulatory and government authorities for their continued support.