Fortis Healthcare Ltd Directors Report.

Dear Members,

Your Directors have pleasure in presenting here the Twenty Fifth Annual Report of the Company along with the Audited Standalone and Consolidated Financial Statements and the Auditors Report thereon for the Year ended March 31, 2021.

FINANCIAL RESULTS

The highlights of Consolidated Financial Results of your Company are as follows:

Particulars Consolidated
Year ended March 31, 2021 Year ended March 31, 2020
Continuing Operations
1 Operating Income 403,012 463,232
2 Other Income 4,656 5,264
3 Total Income (1+2) 407,668 468,496
4 Total Expenditure (Excluding finance cost, depreciation & tax expenses) 362,568 402,280
5 Operating Profit (EBITDA) (3-4) 45,100 66,216
6 Finance Charges, Depreciation & Amortisation 45,648 49,679
7 Profit/ (loss) before share of profit of equity accounted investees, exceptional items and tax (5-6) (548) 16,537
8 Share in profits of associate companies 4,756 1,216
9 Profit/ (loss) before exceptional items and tax (7+8) 4,208 17,753
10 Exceptional items 121 6,183
11 Profit/ (loss) before tax (9+10) 4,329 23,936
12 Tax Expenses 9,946 14,787
13 Profit/ (Loss) for the year from continuing operations (11-12) (5,617) 9,149
14 Discontinuing Operations
Profit/ (Loss) before tax from discontinuing operations - -
Tax expense of discontinuing operations - -
Profit/ (Loss) after tax and before minority interest from discontinuing operations - -
Share in profits/ (losses) of associate companies - -
Profit for the year from discontinuing operations (B) - -
15 Profit/ (loss) for the year (13+14) (5,617) 9,149
Profit for the year attributable to:
Owners of the Company (10,976) 5,794
Non-controlling interests 5,359 3,355
Profit for the year before other comprehensive income
16 Other comprehensive income 1,034 11
17 Total comprehensive income (15+16) (4,583) 9,160
Total comprehensive income for the year attributable to:
Owners of the Company (9,974) 5,947
Non-controlling interests 5,391 3,213

The highlights of financial results of your Company as a Standalone entity are as follows:

Particulars Standalone
Year ended March 31, 2021 Year ended March 31, 2020
Continuing Operations
1. Operating Income 63,287 70,185
2. Other Income 19,198 93,834
3. Total Income (1+2) 82,485 164,019
4. Total Expenditure (Excluding finance cost, depreciation & tax expenses) 60,495 63,390
5. Operating Profit (EBITDA) (3-4) 21,990 100,629
6. Finance Charges, Depreciation & Amortisation 25,223 25,698
7. Profit before exceptional items and tax (5-6) (3,233) 74,931
8. Exceptional items 5,646 (12,863)
9. Profit before tax (7+8) 2,413 62,068
10. Tax Expenses 1,993 10,735
11. Net Profit for the year (9-10) 420 51,333
12. Share in profits of associate companies - -
13. Profit for the year from continuing operations (11+12) 420 51,333
14. Discontinuing Operations
Profit/ (Loss) before tax from discontinuing operations - -
Tax expense of discontinuing operations - -
Profit/ (Loss) after tax and before minority interest from discontinuing operations - -
Share in profits/ (losses) of associate companies - -
Profit for the year from discontinuing operations - -
15. Profit for the year (13+14) 420 51,333
16. Other comprehensive income 86 (12)
17. Total comprehensive income (15+16) 506 51,321

STATE OF COMPANYS AFFAIR, OPERATING RESULTS AND PROFITS

Fiscal 2020-21 was a challenging year for the healthcare sector due to COVID-19 pandemic. The pandemic created a huge strain on the sectors workforce, infrastructure, and supply chain. Fortis also witnessed these challenges and had to re-prioritise its key strategic areas earmarked for the year to focus on the management of the COVID crisis. The Companys performance in both of its hospital and diagnostics businesses was significantly impacted during the first two quarters of the year due to country-wide lockdown in April and May 2020. However, the two businesses witnessed recovery during the latter half of the year. The Company was also successfully able to navigate the challenges by ensuring sustainability

and continuity of business operations and maintaining a comfortable liquidity position through the year.

For the FY 2020-2021, the Company reported a consolidated revenue from operations of 4,030 Crores compared to 4,632 Crores reported for FY 2019-20. Revenue from Hospital business stood at 3,124 Crores compared to 3,753 Crores reported during the corresponding year. SRL Limited, the diagnostic business of the company, reported gross revenues of 1,035 Crores compared to 1,016 Crores in the previous financial year. The diagnostics business witnessed a healthy trend during H2 FY 2020-21 as the non-COVID business saw a significant recovery and also due to increase in demand for COVID and COVID related tests. Considering elimination of inter-company revenue (within the group), net revenue of

SRL Ltd was at 906 Crores compared to 879 Crores in FY 2019- 20.

The consolidated EBITDA of the Company stood at 451 Crores compared to 662 Crores for the previous corresponding year. EBITDA margin of the Company stood at 11.2% in FY 2020-21 versus 14.3% reported in FY 2019-20.

Hospital business EBITDA for FY 2020-21 was at 281 Crores compared to 476 Crores reported for FY 2019-20. EBITDA margin of the hospital business stood at 9.0% in FY 2020-21 versus 12.7% in FY 2019-20.

The diagnostic business of the Company reported EBITDA of 200 Crores compared to 197 Crores reported in the previous corresponding year. EBITDA margin of the diagnostic business stood at 19.3% (basis gross revenue) for the year FY 2020- 21 compared to 19.4% in FY 2019-20.

The consolidated EBITDA for the Company at 451 Crores in FY 2020-21 also accounts for the operational and finance / forex costs related to certain non-operational international entities.

At the consolidated level, the Company reported Profit Before Tax before and exceptional items of 42 Crores versus 178 Crores in the previous FY 2019-20. Profit after tax for FY 202021 stood at a loss of 56 Crores compared to a profit of 91 Crores in the previous financial year.

The Company has a comfortable liquidity position with net debt of 849 Crores as on March 31, 2021 versus 1,004 Crores as of March 31, 2020 (net debt to equity of 0.13x vs 0.14x, respectively). Gross debt of the Company stood at 1,271 Crores as on March 31, 2021 versus 1,354 Crores as of March 31, 2020. The Companys Net Debt / EBITDA (annualised) stood at healthy 1.04x in Q4 FY 2020-21, down from 1.52x in FY 2019-20.

All decisions at your Company are taken with the patient at the center. In line with its objective of becoming the most trusted healthcare provider in India, your Company makes efforts to consistently improve the quality of all its services. Your Company has put together a winning combination of ultra-modern healthcare facilities equipped with best-in-class diagnostic and therapeutic technology and a competent team comprising of some of the finest clinical and paramedical talent available in the country. All facilities owned and operated by your Company follow globally accepted medical protocols and procedures and are focused on delivering the best possible clinical outcomes. Your Companys healthcare facilities provide high standards of secondary, tertiary and quaternary healthcare services in the specialties of Cardiac Sciences, Orthopaedics, Neurosciences, Oncology Sciences, Renal Sciences, Gastro Sciences and Mother and Child care.

During the course of FY 2020-21, your Company launched several new medical programmes and clinical services at its various facilities across the country. A Home Isolation Support Programme for COVID -19 positive patients was launched by Forits Memorial Research Institute (FMRI) Gurugram, Fortis Anandapur, Kolkata, launched the citys only Dual Source Dual Energy Somatom Drive CT scanner, which is 24 times faster than any other CT scan machine. Fortis Hospital, Mulund, introduced Central Mumbais first Tesla Advanced Biomatrix MRI to ramp up the Radiology offerings. Fortis Hospital, BG Road, Bengaluru installed the first state of the art Biplane Cath lab in the state of Karnataka which will provide advanced care for neurovascular disorders.

Your Company plans to launch a number of new projects aimed to fulfil the growing demand. The Company aims to further consolidate its position in Cardiac Sciences and Orthopaedics while focusing on high growth specialties such as Oncology, Neuro Sciences, Gastro Sciences and Renal Sciences. Furthermore, the Company plans to commission over 1,300 new beds over the next 3 to 4 years in existing facilities to leverage economies of scale - majority of bed additions are planned in Noida, BG Road, Anandapur, Mulund, Shalimar Bagh, FMRI, Mohali and Arcot Road.

The healthcare verticals of the Company primarily comprise day care specialty, diagnostics and tertiary and quaternary care. As of March 31, 2021, the Company had a network of 27 healthcare facilities in India with approximately 4,100 operational beds including beds under the O&M model.

In addition, its Indian diagnostics business has a presence in over 600 cities and towns, with an established strength of over 425 laboratories, 20+ radiology / imaging centers; 48+ Accreditations (NABL/NABH/CAP) and a footprint spanning 2250+ customer touch points.

There has been no change in the nature of business of the Company during the year under review. The Company endeavors to provide high quality healthcare services with an emphasis on successful clinical outcomes and a superlative patient experience.

SIGNIFICANT MATTERS DURING THE YEAR UNDER REVIEW

The Company undertook a comprehensive strategic review and prioritised key areas to drive revenues and operational performance. These include aspects related to evaluating the current portfolio of the Companys facilities and planned bed expansion, initiating cost optimisation measures across the network, investing in technology and medical equipment and further strengthening its clinical excellence program. Further details of this are mentioned in the Business Strategy section of the Management Discussion and Analysis Report (MDA). Further, the Board has from time to time during the year under review updated its stakeholders about the key developments that took place by disseminating necessary information to the stock exchanges and through various means of communications to the investors. Some of key activities are mentioned below:

• Changed Board and Key Managerial Personnel-

During the year under review, the Board of Directors and Key Managerial Personnel underwent changes, details whereof are separately disclosed in this report.

• Open Offer- The Board had at its meeting held on July 13, 2018, accepted the binding bid made by IHH Healthcare Berhad (IHH). Pursuant thereto your Company entered into subscription Agreement dated July 13, 2018 for issuance of 23,52,94,1 17 Shares at a price of 170 per share for an aggregate consideration upto 4,000 Crores (Rupees Four Thousand Crores only) to Northern TK Venture Pte Limited ("NTK"), an indirect wholly owned subsidiary of IHH. Consequently, after obtaining regulatory and statutory approvals such as from Securities and Exchange Board of India, Competition Commission of India and in terms of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, IHH made the Mandatory Open Offer for acquisition of upto 197,025,660 Equity Shares representing additional 26% of the expanded voting share capital of your Company ("Fortis Open Offer") and another Mandatory Open Offer for acquisition of up to 4,894,308 fully paid up equity shares of face value of 10 each, representing 26% of the fully diluted voting equity share capital of Fortis Malar Hospitals Limited ("Fortis Malar Open Offer").

After the Preferential Allotment on November 13, 2018, public announcement was made on December 7, 2018 regarding Fortis Open Offer and Fortis Malar Open Offer, thereafter the Honble Supreme Court of India had on December 14, 2018 passed an order ("Order") directing "status quo with regard to sale of the controlling stake in Fortis Healthcare to Malaysian IHH Healthcare Berhad be maintained". In light of the Order, Fortis Open Offer and Fortis Malar Open Offer were put on hold until further order(s) / clarification(s) / direction(s) issued by the Honble Supreme Court of India. Application was filed by your Company for modification of the Order and for proceeding with Fortis Open Offer and Fortis

Malar Open Offer. Vide its judgment dated November 15, 2019 ("Judgment"), the Honble Supreme Court issued suo-moto contempt notice to, among others, your Company, and directed its Registry to register a fresh contempt petition in regard to alleged violation of the Order ("Contempt Petition"). In this respect, the Honble Supreme Court sought an enquiry into:

(i) Whether the subscription by NTK for the Shares of your Company was undertaken after the Order, and accordingly if such subscription was in violation of the Order; and

(ii) The consummation of acquisition of healthcare assets from RHT Health Trust by your Company.

The Company has filed a reply to the show cause notice issued in the suo-moto contempt, praying inter alia, that the suo-moto contempt proceedings be dropped and Order be modified / vacated such that Fortis Open Offer and Fortis Malar Open Offer may proceed. Since the issuance of the Judgement, several other parties have filed applications before the Honble Supreme Court, for seeking various remedies including (i) A minority shareholder of your Company ("Minority Shareholder") has sought resumption of the Fortis Open Offer; (ii) Daiichi Sankyo Co. Ltd has sought permission to be impleaded in the Suo- Moto Contempt; (iii) Securities and Exchange Board of India has sought resumption of the Fortis Open Offer citing larger public interest at stake; (iv) NTK has filed applications to intervene in the Supreme Court Proceedings, to be heard and for vacation of the Order that continues to stay the Fortis Open Offer and Fortis Malar Open Offer. On August 14, 2020 an application has been submitted before the Honble Supreme Court of India seeking permission for change of name, brand and logo of your Company and its subsidiaries. The matter is sub-judice.

• Other Matters: The Companys Board of Directors initiated additional procedures/ enquiries of certain entities in the Group that were impacted in respect of the matters investigated by an appointed external legal firm. Pending completion of the additional procedures / enquiries ("Additional Procedures / Enquiries") and since the earlier investigation was subject to the limitations on the information available to the other external legal firm (being subject to their qualifications and disclaimers as described in their investigation report, as disclosed in the audited financial statements for the years ended March 31, 2018, March 31, 2019

ANNUM REPORT 7070021 87

and March 31, 2020) certain audit qualifications were made in respect of FHLs financial statements for those financial years, as the statutory auditors were unable to comment on the nature of those matters, the provisions established thereof, or any further potential impact on the financial statements. In order to resolve the same, the Board mandated the management to undertake review of certain areas in relation to historical transactions for the period April 1,2014 to September 30, 2018 involving additional verification by engaging independent experts with specialised forensic skills to assist with the Additional Procedures/Enquiries and conduct data gathering exercise in connection therewith. The independent experts submitted their report which was discussed and considered by the Board in its meeting held on September 16, 2020.

The Board noted that the Additional Procedures / Enquiries, prima facie, revealed further instances of payments made to the erstwhile promoters or to their directly or indirectly related parties including erstwhile promoter group entities which were potentially improper. All of the amounts identified in the Additional Procedures / Enquiries had been previously provided for or expensed in the financial statements of FHL or its subsidiaries with full disclosures. There are no further improper transactions identified by the Additional Procedures / Enquiries or / by the management which had not been expensed or provided. In connection with the potentially improper transactions, your Company has undertaken a detailed review of each case to assess the Companys legal rights and has initiated appropriate legal action. Complaint has been filed with the Economic Offences Wing ("EOW") in November 2020 against erstwhile promoters / erstwhile promoters group company in respect of certain transactions which is being investigated.

DIVIDEND AND TRANSFER TO RESERVES

The Board of Directors of the Company have not recommended any dividend for the FY 2020-21. Accordingly, there has been no transfer to general reserves and the Company would like to retain its profit this year to strengthen its business.

Refer the Companys policy on Dividend Distribution available on the website of the Company at https:/www. fortishealthcare.com/investors - Corporate Governance / Policies / Codes / Policy on Dividend Distribution.

MATERIAL CHANGES

There are no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the FY 2020-21 and the date of this report.

STATEMENT IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Statutory Auditors in their report to the Board of Directors on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("The Act") have given the opinion that the Company and such companies incorporated in India which are its subsidiary companies and joint venture companies (jointly controlled company), have, in all material respects, adequate internal financial controls with reference to consolidated financial statements and the financial statements of the Company and such internal financial controls were operating effectively as at March 31, 2021, based on the internal financial controls with reference to consolidated financial statements and the financial statements of the Company, criteria established considering the essential components of such internal controls stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. The Auditors opinion on adequacy and operating effectiveness of internal control is self-explanatory.

DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES

During the year under review there has been no change in the subsidiaries / joint venture and associate Companies.

Further note that your Board of Directors have adopted a policy for determining "material subsidiary" pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The said policy is available at https:// www.fortishealthcare.com/investors - Corporate Governance / Policies / Codes / Policy for determination of Material Subsidiary.

In terms of the said policy, as on April 1,2021, Fortis Hospitals Limited (FHsL), International Hospital Limited (IHL), Fortis Hospotel Limited (FHTL) and SRL Limited are considered as Material Subsidiary(ies). Necessary compliances w.r.t. material subsidiaries have been duly carried out.

Further, during the year under review a material subsidiary of the Company i.e. SRL Limited ("SRL") executed SRL PE amendment agreement dated March 30, 2021 to amend the terms of the existing Shareholder Agreement dated June 12, 2012 between SRL Limited and International Finance Corporation, Nylim Jacob Ballas India Fund III LLC, Resurgence PE Investments Limited (collectively referred as "PE Investors") and Fortis Healthcare Limited for incorporating new exit rights of the PE Investors. Simultaneously, to align with the amendment, the Exit Agreement dated June 12, 2012 executed amongst Fortis Healthcare Limited, SRL and the PE Investors was terminated. Post closure of the year under review, a material subsidiary of the Company i.e. SRL, acquired balance 50% stake in joint venture DDRC SRL Diagnostics Private Limited (DDRC SRL) in terms of Share Purchase Agreement dated March 24, 2021 and thereby DDRC SRL became a step-down subsidiary of the Company effective April 5, 2021.

PERFORMANCE AND FINANCIAL POSITION OF EACH OF THE SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES

The consolidated financial statements of your Company and its subsidiaries, prepared in accordance with applicable accounting standards, issued by the Institute of Chartered Accountants of India, forms part of the Annual Report. In terms of the Section 136 of the Companies Act, 2013, financial statements of the subsidiary companies are not required to be sent to the members of the Company. Your Company will provide a copy of separate annual accounts in respect of each of its subsidiary to any shareholder of the Company who asks for it and said annual accounts will be available for inspection. Performance and financial position of each of Subsidiaries, Associates and Joint Ventures included in the Consolidated Financial Statements of your Company is enclosed herewith as "Annexure - I" in the prescribed format (Form AOC-1).

The contribution of the subsidiary/associates/joint venture companies to the overall performance of your Company is outlined in Note No. 27 of the Consolidated Financial Statements for the year ended March 31, 2021.

LOANS / ADVANCES / INVESTMENTS / GUARANTEES

Particulars of Loans / Advances / Investments / guarantees given and outstanding during the FY 2020-21 forms part of the Notes to the Financial Statements.

PUBLIC DEPOSITS

During the financial year under review, the Company has not invited or accepted any deposits from the public, pursuant to the provisions of Section 73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposit) Rules, 2014 and therefore, no amount of principal or interest was outstanding in respect of deposits from the Public as of the date of Balance Sheet.

UTILISATION OF FUNDS

The details of utilisation of funds raised through preferential allotment during the year are mentioned in Notes to Financial Statements.

AUDITORS

• Statutory Auditors

M/s B SR & Co. LLP, (Registration No. 101248W/W- 100022), Chartered Accountants, were appointed as Statutory Auditors of your Company for a period of five years i.e. up to the conclusion of the Annual General Meeting to be held in the year 2024.

The statutory auditors have, in their report to the Board of Directors on the consolidated financial statements of the Company made the following comments which are self-explanatory and are categorised as "Emphasis of Matter", hence no comments in this regard have been offered by your Board of Directors: a) Note 28 and Note 29 of the consolidated financial statements which deal with various matters including the ongoing investigation by Serious Fraud Investigation Office ("SFIO") and ongoing adjudication proceedings by Securities and Exchange Board of India ("SEBI") on Fortis Healthcare Limited (hereinafter referred to as "the Company" or the "Holding Company") and its subsidiaries (Holding Company and its subsidiaries together referred to as "the Group") regarding alleged improper transactions and non-compliances with laws and regulations including Companies Act, 2013 (including matters relating to remuneration paid to managerial personnel) and SEBI laws and regulations. These transactions and non-compliances relate to or originated prior to take over of control by present board of directors in the year ended 31 March 2018. As mentioned in the note, the Group has been submitting information required by SFIO and has responded to the SEBI notice and is also cooperating in the regulatory investigations/ proceedings.

As explained in the said note, the Group had recorded significant adjustments/ provisions in its books of account during the year ended March 31, 2018. The Company has launched legal proceedings

and has also filed a complaint with the Economic Offences Wing (EOW) against erstwhile promoters and their related entities based on the findings of the investigation conducted by the Group. Further, based on managements detailed analysis and consultation with external legal counsel, a further provision has been made and recognised in the current year for any contingency that may arise from the aforesaid issues. As per the management, any further impact, to the extent it can be reliably estimated as at present, is not expected to be material.

b) Note 30 of the consolidated financial statements relating to the order dated 15 November 2019 of the Honble Supreme Court, where it is stated that the Honble Supreme Court has issued suo-moto contempt notice to, among others, the Company and directed its Registry to register a fresh contempt petition in regard to alleged violation of its order dated December 14, 2018. In this respect, the Honble Supreme Court has sought an enquiry, into (i) whether the subscription by Northern TK Venture Pte Ltd., Singapore, a wholly owned subsidiary of IHH Healthcare Berhad, Malaysia, to the shares of the Company was undertaken after the status quo order was issued by the Honble Court on December 14, 2018 and accordingly, if such subscription was in violation of this status quo order; and (ii) the consummation of the acquisition of healthcare assets from RHT Health Trust by the Company. As also explained in the said note, the management believes that it has a strong case on merits and as per the current position of the case, the liability, if any, arising out of this contingency cannot be determined at this stage. Accordingly, at present, no adjustment is required in the consolidated financial statements.

c) As explained in Note 14(I) of the consolidated financial statements, a Civil Suit claiming 25,344 lacs was filed by a third party against various entities including the Company and certain entities within the Group relating to "Fortis, SRL and La-Femme" brands. Based on legal advice of external legal counsel, the Management believes that the claims are without legal basis and not tenable. Further, as mentioned in Note 30 of the consolidated financial statements, the tenure of brand license agreement entered by the Company has expired and the Company has filed an application before the Honble Supreme Court of India seeking permission for change of company name, brand and logo. The matter is currently sub-judice.

d) Note 14(II)(i) and 14(II)(iii) of the consolidated financial statements, relating to the outcome of civil suit with regard to termination of certain land leases allotted by Delhi Development Authority (DDA) and the matter related to non-compliance with the order of the Honble High Court of Delhi in relation to provision of free treatment/ beds to poor by EHIRCL. Based on the advice given by external legal counsel, no provision / adjustment has been considered necessary by the management with respect to the above matters in these consolidated financial statements, considering the uncertainty relating to the outcome of these matters.

e) Note 14(111) of the consolidated financial statements, which describes in detail the matter relating to the termination of hospital lease agreement by Navi Mumbai Municipal Corporation vide order dated January 18, 2017 of Hiranandani Healthcare Private Limited ("HHPL"), one of the subsidiaries in the Group. HHPL has filed a Writ Petition before the Honble Supreme Court of India challenging the Termination Order, which is pending hearing and disposal. Based on the opinion obtained from the legal counsel, the management is confident that HHPL will be able to successfully defend the termination order. However, due to uncertainties involved, the ultimate outcome will be ascertained on disposal of the said petition.

f) Note 37 of the consolidated financial statements, which describes the economic and social consequences the Group is facing as a result of COVID-19 which is impacting supply chains / demand / personnel available for work and or being able to access of offices/ hospitals.

The statutory auditors have, in their report to Board of Directors on the consolidated financial statements of the Company given a qualified opinion as follows: • Qualified opinion

We have audited the consolidated financial statements of Fortis Healthcare Limited (hereinafter referred to as "the Company" or the "Holding Company") and its subsidiaries (Holding Company and its subsidiaries together referred to as "the Group"), its associates and its joint ventures, which comprise the consolidated balance sheet as at March 31, 2021, and the consolidated statement of profit and loss (including other comprehensive income), consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as "the consolidated financial statements").

In our opinion and to the best of our information and according to the explanations given to us, and based on the consideration of reports of other auditors on separate financial statements of such subsidiary and joint ventures as were audited by the other auditors, and except for the possible effects, if any, of the matter described in the "Basis for Qualified Opinion" paragraph of our report, the aforesaid consolidated financial statements give the information required by the Companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the consolidated state of affairs of the Group, its associates and joint ventures as at March 31, 2021, of its consolidated loss, other comprehensive income, consolidated changes in equity and consolidated cash flows for the year then ended.

• Basis for Qualified Opinion

We draw attention to Note 40 of the consolidated financial statements, which explains that due to a significant amount of dividend received during the previous year ended March 31, 2020 from a wholly owned overseas subsidiary, the income from financial assets of the Company was more than 50 percent of the gross income for the year then ended. Further, in view of the investments in subsidiaries and financing provided to them, the Companys financial assets as at that date are also more than 50 percent of its total assets. Consequently, the Company technically meets the "principal business test" criteria for classification as a Non-Banking Financial Company (NBFC) as per press release by Reserve Bank of India (RBI) vide No. 1998-99/1269 dated April 08, 1999 as at April 01, 2020 and is required to obtain a certificate of registration as a NBFC. As per the Company, such dividend is non-recurring in nature and does not represent income from ordinary activities of the Company and the Company does not intend to carry on the business as a NBFC. Accordingly, the Company, vide its letter dated November 08, 2019, had made a representation to the RBI that keeping in view the objective behind the principal business test criteria, its registration as a NBFC should not be required. Subsequent to the completion of audit of the standalone financial statements of the Company for the year ended March 31, 2020, we, as statutory auditors, have also intimated the RBI regarding the Company technically meeting the Principal Business Test and regarding the above referred representation by the Company to the RBI which inter alia stated that the Company is primarily engaged in the healthcare business, and that the Company has represented to the RBI that it does not presently or in future intend to undertake the business of non-banking financial institution. Further, in September 2020, the Company has written another letter to RBI with a request to confirm that no such registration as a NBFC is required. RBI advised the Company to submit to it the financial results for the quarters ended June 30, 2020, September 30, 2020 and December 31, 2020 which were duly submitted by the Company.

Pending resolution of the matter with RBI, we are unable to comment on the impact thereof, if any, on the consolidated financial statements for the year ended March 31, 2021.

• Directors response to comments of the statutory auditors in the Audit Report:

With regard to the comments of the statutory auditors in paragraph basis for qualified opinion of Audit Report, pertaining to NBFC registration, it has been explained in Note 40 of the consolidated financial statements, as per the RBIs Master Direction- Non-Banking Financial Companies Auditors Report (Reserve Bank) Directions, 2016, on the issue of NBFC registration, the statutory auditor is to examine whether the company has obtained a Certificate of Registration from the RBI when the "company is engaged in the business of nonbanking financial institution as defined in section 45-I(a) of the RBI Act and meeting the Principal Business Criteria (Financial Asset/ income pattern)". The Company has, in Note 40 of the consolidated financial statements, clarified that while it technically would meet the Principal Business Test due to this significant dividend on account of the one-off transaction, it does not, and does not intend to, carry on the business as non-banking financial institution. The Board has also noted and confirmed by way of a board resolution that the significant dividend received during the previous year ended March 31,2020 does not represent income from ordinary activities of the Company and that the Company does not intend to carry on the business as an NBFC. In this backdrop, the requirement for registration as a non-banking financial institution should not arise.

The Company also has made a representation to the RBI in November 2019, i.e. more than a year ago, that while the Company technically would meet the Principal Business Test due to this significant dividend on account of the one- off transaction, it does not, and does not intend to, carry on the business as an NBFC and hence keeping in view the objective behind the test, its registration as a NBFC should not be required. Subsequent to the completion of audit of the financial statements of the Company for the year ended March 31, 2020, the statutory auditor of the Company has also intimated the RBI regarding the Company technically meeting the Principal Business Test and regarding the above referred representation by the company to the RBI which inter alia stated that the Company is primarily engaged in the healthcare business, and that the Company has represented to the RBI that it does not presently or in future intend to undertake the business of non-banking financial institution. Further, during the current year the Company wrote a letter to RBI with a request to confirm that no such registration as a NBFC is required. It also requested for a meeting to give an opportunity to the Company to explain its position on the matter. During the current quarter ended March 31,2021 RBI advised the Company to submit to it the financial results for the quarter ended June 30, 2020, September 30, 2020 and December 31, 2020 which was duly submitted. Further, as evident from these financial statements, the criteria for principal business test is not met as at March 31, 2021. For more details, please refer to note 40.

The statement of impact of Audit Qualification as stipulated in regulation 33(3)(d) is placed below:

• Qualification in the Auditors Report

The Board of Fortis Healthcare Limited, has dealt with the matters stated in the qualification in statutory auditors report on the Consolidated Financial Statement of Fortis Healthcare Limited ("the Parent" or "the Company") and its subsidiaries (the Parent/Company and its subsidiaries together referred to as "the Group") and its share of profit /(Loss) of its joint ventures and associates for the year ended March 31, 2021 ("the Consolidated Annual Financial Statement") included in the Statement of Consolidated

Financial Statement ("the Consolidated Statement") to the extent information was available with them.

Sl. Particulars No. Audited Figures (as reported before adjusting for qualification) Adjusted Figures (audited figures after adjusting for qualification) $
1 Turnover / Total income 407,668 Not Determinable
2 Total Expenditure 408,216 ---Do---
3 Share of profit of associates and joint ventures (net) 4,756 ---Do---
4 Exceptional gain 121 ---Do---
5 Tax expense 9,946 ---Do---
6 Net Profit/(Loss) (5,617) ---Do---
7 Earnings Per Share (1.45) ---Do---
8 Total Assets 1,115,468 ---Do---
9 Total Liabilities 443,687 ---Do---
10 Net Worth* 671,781 ---Do---

"$" for Qualification of the Auditors Report.

* Including non-controlling interest of 59,800 Lakhs.

• Qualification of the Auditors Report

1. Details of Audit Qualification:

As per audit report para on "Basis for Qualified Opinion"

2. Type of Audit Qualification:

Qualified Opinion

3. Frequency of qualification:

First time

4. For Audit Qualification(s) where the impact is quantified by the auditor, Managements Views:

Not Applicable

5. For Audit Qualification(s) where the impact is not quantified by the auditor:

(i) Managements estimation on the impact of audit qualification:

Not quantifiable.

(ii) If management is unable to estimate the impact, reasons for the same:

Please refer to Directors response to comments of the statutory auditors in the Audit Report as stated in above Directors Report.

(iii) Auditors Comments on (i) or (ii) above:

The Company technically meets the "principal business test" criteria for classification as a Non-Banking Financial Company (NBFC). As per the Company, such significant dividend income recorded in the year ended March 31, 2020 is non-recurring in nature and does not represent income from ordinary activities of the Company and the Company does not intend to carry on the business as a NBFC. The Company has written letters to RBI with a request to confirm that no such registration as a NBFC is required. Pending resolution of the matter with RBI, we are unable to comment on the impact thereof, if any, on the financial statements for the year ended March 31,2021.

• Cost Auditor

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the cost audit records maintained by the Company in respect of its hospital activity is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed M/s. Jitender, Navneet & Co., Cost Accountants to audit the cost accounts of the Company for the FY 2020-21 at a remuneration upto 3.5 Lakhs (plus out of pocket expenses and taxes). As required under the Companies Act, 2013, the remuneration payable to the cost auditors is required to be placed before the Members in a general meeting for ratification. Accordingly, a resolution seeking Members ratification for the remuneration payable to M/s Jitender, Navneet & Co., Cost Auditors is included in the Notice convening the ensuing Annual General Meeting. Further, in terms of the Companies (Accounts) Rules, 2014, it is confirmed that maintenance of cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013, is applicable on the Company and accordingly such accounts and records are properly made and maintained.

• Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Sanjay Grover & Associates, Practicing Company Secretary, to undertake the Secretarial Audit of the Company. The Company has complied with the provisions of Secretarial Standards,

to the extent feasible. The Secretarial Audit Report is enclosed herewith as "Annexure - II".

• Internal Auditors

Upon the recommendation of the Audit and Risk Management Committee, the Board of Directors has appointed Mr Rajiv Puri, Head Risk and Internal Audit as the Chief Internal Auditor of the Company and authorised him to engage independent firm(s), if needed, for conducting the internal audit for the FY 2020-2021 to enable him to extend adequate coverage of internal audit checks. Accordingly, PWC was engaged to carry out certain aspects of Internal Audit for the Company / its subsidiaries to augment the in-house team of internal audit team led by the Chief Internal Auditor.

Besides, the matters mentioned in basis for qualified opinion in the Auditors Report, if any, as per the requirement of Companies Auditor Report Order (CARO), Rules, 2016, there was no fraud reported by the above stated auditors during the year under review.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS

During FY 2020-21, the Company received an order dated November 12, 2020 passed by the Securities and Exchange Board of India (SEBI) revoking its earlier interim orders read with confirmatory order qua Best Healthcare Private Limited, Fern Healthcare Private Limited and Modland Wears Private Limited and directed that the ongoing proceedings be substituted with adjudication proceedings. The order clarified that the Company and Fortis Hospitals Limited (FHsL) were at liberty to pursue remedies under law, as deemed appropriate by them, against the above mentioned entities in respect of their role in the diversion of funds.

Subsequently, a Show-Cause Notice (SCN) was issued by SEBI to various entities including the Company and FHsL on November 20, 2020, which alleged that the consolidated financials of FHL at the relevant period were untrue and misleading for the shareholders and the Company has circumvented certain provisions of the SEBI Act, Securities Contracts (Regulation) Act, 1956, and certain SEBI regulations.

In response, a joint representation / reply was filed by the Company and FHsL on December 28, 2020 praying for quashing of the SCN on various grounds, after which oral submissions in response to the SCN were made in a personal hearing before the SEBI Whole Time Member on January 20, 2021 and a written synopsis of the same was also filed thereafter. We await the outcome of the hearing before SEBI. Details of this matter is provided in note 29(a) of consolidated financial statements.

a mmi i a i DcnrrDT -i 03

CAPITAL STRUCTURE / STOCK OPTION

The Company currently manages its stock options through "Employee Stock Option Plan 2007" and "Employee Stock Option Plan 2011" ("Schemes") as approved by the shareholders. The Nomination and Remuneration Committee of the Board of Directors of the Company, inter alia, administers and monitors the Schemes of the Company. Each option when exercised would be converted into one fully paid up equity share of 10 each of the Company. During the year under review, no option was granted by the Company. Disclosure pursuant to the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 for the year ended March 31, 2021 is available at the website of the Company at https://www.fortishealthcare.com/investors - Annual Report / ESOP Disclosure 2020-21.

During the year under review, "no stock options were exercised under the terms of the "Employee Stock Option Plan 2007 and "Employee Stock Option Scheme 2011".

The certificate from the Statutory Auditors of the Company stating that the Schemes have been implemented in accordance with the SEBI Regulations would be placed at the ensuing Annual General Meeting for inspection by members. The Company has not made any provision of money for purchase of, or subscription for, its own shares or of its holding Company.

Details pertaining to shares in suspense account are specified in the report of Corporate Governance forming part of the Board Report.

Extract of Annual Return is enclosed herewith as "Annexure - III".

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

The particulars required under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014, regarding Conservation of Energy and Technology Absorption, is given in "Annexure - IV", forming part of the Boards Report. Further, details pertaining to Foreign Exchange Earnings and Outgo is as given below:

Total Foreign Exchange Earned and Used (Based on Standalone Financial Statements) during the financial year ended March 31, 2021:

Particulars Amount (in Crores)
Foreign Exchange earned in terms of 2.10
Actual Inflows
Foreign Exchange outgo in terms of 1.06
Actual Outflows

Note: Earning and expenditure in foreign currency is on accrual basis.

CORPORATE SOCIAL RESPONSIBILITY - OUR JOURNEY THROUGH THE PAST YEAR

During FY 2020-21, Fortis Healthcare Limited along with its subsidiaries contributed a total of 14.25 Crores towards various Corporate Social Responsibility (CSR) initiatives.

As a responsible corporate member of the Indian healthcare ecosystem, Fortis Healthcare Limited strongly believes that we can meaningfully alleviate the problem of inequitable access to quality healthcare. By creating and supporting social sector programmes linked to health and well-being, we seek to leverage our skills, experience, capabilities, technologies and facilities to address a critical social need for the vulnerable sections of society. Following a rigorous needs assessment, we have enabled initiatives & programmes aimed at creating social awareness and bringing about a positive change in the communities.

The Companys CSR initiatives follow a need based program approach. CSR activities are carried out in a collaborative and inclusive manner not only to align and synergise the social enterprise work of the group companies but also to expand the circle of partnerships with Government, Non-Government Organisations (NGOs), other Corporates and Individuals. The CSR initiatives of the Company are in line with Indias Sustainable Development Goal (SDG) of Good health and well-being and also supporting Government initiative as per Schedule VII of Section 135 of the Companies Act, 2013.

The Company and its subsidiaries supported the efforts of the Government in the fight against COVID-19, Research & Development and Central Armed Police Forces (CAPF) & also supported Central Para Military Forces (CPMF) veterans and their dependents including widows.

Fortis Healthcare Limited and Fortis Hospotel Limited: This year Company and one of its wholly owned subsidiary viz Fortis Hospotel Limited contributed its CSR Fund to "Bharat Ke Veer" fund to support Central Armed Police Forces

(CAPF) & Central Para Military Forces (CPMF) veterans and their dependents including widows. A fund-raising initiative by the Ministry of Home Affairs, Govt. of India on behalf of members of the Indian paramilitary Forces. They are always on duty and have round the clock commitments throughout the year, without any consideration for leave, holidays, weekends, festivals and personal commitments. They work in a very hazardous conditions and stress compiled with unhygienic living conditions. Many lost their life in terrorist / Naxalite attacks. Our contribution will support the dependents and widows of Braveheart heroes.

Escorts Heart Institute and Research Centre Limited and SRL Limited:

This year Escorts Heart Institute and Research Centre Limited and SRL Limited contributed CSR fund to ICMR (The Indian Council of Medical Research) fund to support research and development projects in the field of science, technology, engineering and medicine. The fund to ICMR is duly approved CSR fund as per Schedule VII of Section 135 of the Companies Act. The ICMR has always attempted to address itself to the growing demands of scientific advances in biomedical research on the one hand, and to the need of finding practical solutions to the health problems of the country, on the other.

Particulars pursuant to Clause O of Sub-Section 3 of Section 134 of The Companies Act, 2013 read with Rule 9 of Companies (Corporate Social Responsibility) Rules, 2014 is given in "Annexure V".

DIRECTORS AND KEY MANAGERIAL PERSONNEL

The Board of Directors of the Company as on date of this report comprises twelve directors, of which one is a Managing Director and CEO (Executive Director), four are Independent Directors and rest of the seven directors are Non-Executive & Non-Independent Directors. Pursuant to Sections 152 of the Companies Act, 2013, Dr. Kelvin Loh Chi Keon and Mr Heng Joo Joe Sim are liable to retire by rotation and being eligible offers themselves for re-appointment at the forthcoming Annual General Meeting of the Company. During the year under review, the Board of Directors has appointed Mr. Dilip Kadambi and Ms Shailaja Chandra as Directors of the Company w.e.f. June 4, 2020 and June 28, 2020, respectively. The matter(s) related to their appointment was placed before the shareholders at the twenty fourth Annual General Meeting of the Company held on August 31, 2020.

During the year under review, the Board of Directors has co-opted Mr Takeshi Saito and Mr Joerg Ayrle as an additional director(s) w.e.f. September 1, 2020 & March 31, 2021 respectively. The matter(s) related to their appointment are being placed at the forthcoming Annual General Meeting. Further, during the year under review, Mr Low Soon Teck has resigned from directorship of the Company w.e.f. June 4, 2020. Your Board places on record its appreciation for the contribution made by Mr. Low Soon Teck during his association with the Company.

Dr. Ashutosh Raghuvanshi was appointed as Chief Executive Officer with effect from March 18, 2019 and Chief Executive Officer and Managing Director (CEO & MD) of the Company with effect from March 19, 2019 for a period of three years. The matter related to his re-appointment as CEO & MD for a further period of three years with effect from March 19, 2022 is being placed at the forthcoming Annual General Meeting. Brief resume of the directors being appointed and / or proposed to be regularised at the forthcoming Annual General Meeting is separately disclosed in the Notice of the ensuing Annual General Meeting.

All Independent Directors have submitted declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. During the FY 2020-21, Ten (10) meetings were held by the Board of Directors. The details of board / committee meetings and the attendance of Directors are provided in the Corporate Governance Report.

Details of Key Managerial Personnel are as under:

Name Designation
Dr. Ashutosh Raghuvanshi Managing Director and Chief Executive Officer
Mr Vivek Kumar Goyal Chief Financial Officer
Mr Sumit Goel Company Secretary

Disclosures regarding the following are mentioned in report on Corporate Governance forming part of this report.

1. Composition of Committee(s) of the Board of Director and other details;

2. Details of establishment of Vigil Mechanism;

3. Details of remuneration paid to all the Directors including Stock options; and

4. Commission received by Independent Director(s); if any.

BOARD EVALUATION

Pursuant to the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board and the respective committees are required to carry out performance evaluation of the Board as a body, the Directors individually, Chairman as well as that of its Committees.

The Board of Directors of the Company, in order to give objectivity to the evaluation process identified an independent third party for conducting board evaluation exercise for this financial year.

The following process of evaluation was approved by the Nomination and Remuneration Committee and the Board of Directors:

S. Process No. Remarks Criteria for Evaluation (including Independent Directors)
1. Kick Off Board Evaluation Program The Chairperson kick starts the process. Appointed and designated independent external agency as Process Coordinator
2. Evaluation forms and One to One discussion Process Coordinator interacted with the Board members to assess performance, invite direct feedback and seek inputs to identify opportunities for improvement. Process Coordinator circulated the feedback questionnaire to the board members and invited feedback from individuals, after collecting the key findings, one to one discussions were conducted to seek further clarity. This includes Board focus (Strategic inputs), Board Meeting Management, KPIs, suggestions to improve Board performance, Board Effectiveness, Management Engagement, Governance, Risk Management and addressing of follow up requests.
3. Evaluation by the Board and of Independent Directors A compilation of the individual self-assessments and one to one discussions were placed at the meetings of the Independent Directors (IDs) and the Board of Directors (BoD) for them to review collectively. This includes demonstration of integrity, commitment, attendance at the meetings, contribution and participation, professionalism, contribution while developing Annual Operating Plans, demonstration of roles and responsibilities, review of high risk issues & grievance redressed mechanism, succession planning, working of Board Committees etc.
4. Final recording and reporting Based on the above, a final report on Board Evaluation 2020-21 was presented at a meeting of the Board of Directors held on May 29, 2021. NA

MANAGERIAL REMUNERATION

Disclosures pursuant to Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as under:

(a) Comparison and ratio of the remuneration of each director to the median remuneration of the employees of the Company for the FY 2020-21

Name of the Director Remuneration of Director ( in Crores) Median Remuneration of Employees ( in Crores) Ratio
Dr. Ashutosh Raghuvanshi 6.22 0.021 283:1

(b) The percentage increase in remuneration of each director, Chief Financial Officer, Chief Executive Officer, Company Secretary or Manager, if any,

during the financial year under review: During the year there was no change in the remuneration / no increments were given across the Group due to COVID pandemic.

(c) The percentage increase in the median remuneration of employees in the financial year - NIL

(d) The number of permanent employees on the rolls of the Company is 2,680 as on March 31, 2021 as compared to 2644 as on March 31, 2020.

(e) Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and any exceptional circumstances for increase in the managerial remuneration

Particulars For the FY 2020-21
(A) Average percentile increases already made in the salaries of employees other than the managerial personnel During the year no increments were given across the Group due to COVID
(B) Percentile increase in the managerial remuneration pandemic.
Comparison of (A) and (B)
Justification
Any exceptional circumstances for increase in the managerial remuneration

(f) During the FY 2020-21, 2,50,10,160 variable pay was paid to Dr. Ashutosh Raghuvanshi, MD and CEO, 80,19,150 to Mr Vivek Kumar Goyal, Chief Financial Officer and 5,71,122 to Mr. Sumit Goel, Company Secretary for FY 2019-20.

(g) Remuneration paid to Directors and KMPs is as per the Remuneration Policy of the Company.

REMUNERATION POLICY

The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration including criteria for determining qualifications, positive attributes, independence of a Director etc. The same is governed by Board of Directors Governance Standard and it is available on the website of the Company at https://www. fortishealthcare.com/investors - Corporate Governance / Policies / Codes / Board Governance Document. Details of Remuneration Policy and changes, if any, are stated in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the Members.

RELATED PARTY TRANSACTIONS

Disclosures as required under Section 134(3)(h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014, are given

in "Annexure - VI" in Form AOC- 2 as specified under the Companies Act, 2013.

The Related Party Transactions are placed before the Audit Committee for approval as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseeable and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee for their review on a quarterly basis.

The Company has developed a Related Party Transactions Framework for the purpose of identification and monitoring of such transactions.

The policy on Related Party Transactions as approved by the Board is uploaded on the Companys website at https://www.fortishealthcare.com/investors - Corporate Governance / Policies / Codes / Policy on Related Party Transactions.

None of current Directors have had any pecuniary relationship or transaction vis-a-vis the Company except to the extent of sitting fees and remuneration approved by the Board of Directors and / or shareholders of the Company as disclosed in this Annual Report.

RISK MANAGEMENT POLICY

The Company has designed a risk management policy and framework for risk identification, assessment, mitigation plan development and monitoring of action to mitigate the risks. The key objective of the ERM policy is to provide a formalised framework to enable judicious allocation of resources on the critical areas which can adversely impact the Companys ability to achieve its objectives. The policy is applicable to the Company and its subsidiaries. This framework enables the management to develop and sustain a risk-conscious culture, wherein, there is a high degree of organisation-wide awareness and understanding of external and internal risks associated with the business. The policy defines an architecture and oversight structure to assist effective implementation. By clearly defining terms and outlining roles and responsibilities, ERM promotes risk ownership, accountability, self-assessment and continuous improvement to minimise adverse impact on achievement of business objectives and enhance the Companys competitive advantage. The details thereof are covered under the Management and Discussion Analysis Report which forms part of the Annual Report

POLICY FOR PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT

The Company has adopted a Policy for Prevention, Prohibition and Redressal of Sexual Harassment. As per the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder, the Company has constituted Internal Complaints Committees (ICC). During the FY 2020-21, the Company received Three (3) complaints on sexual harassment and Three (3) complaints were resolved with appropriate action taken and no complaint was pending as on March 31, 2021. The same may also be read in terms of Companies (Accounts) Rules, 2014.

DISCLOSURE REQUIREMENTS

As per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Corporate Governance Report with Auditors certificate thereon and Management Discussion and Analysis Report are attached, which form part of this report.

CODE OF CONDUCT

Declaration by Dr. Ashutosh Raghuvanshi, Managing Director and Chief Executive Officer confirming compliance with the Fortis Code of Conduct is enclosed with Corporate Governance Report.

CERTIFICATE BY STATUTORY AUDITORS FOR DOWNSTREAM INVESTMENT

A certificate from the Statutory Auditors of the Company stating that the Company has duly complied with the requirements of downstream investment made by the Company to second level entities in accordance with Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2017 would be available at the Annual General Meeting for inspection by members.

DIRECTORS RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

(a) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with

proper explanations relating to material departures therefrom, if any;

(b) The selection and application of accounting policies were assessed for their consistent application and judgements and estimates were made that are reasonable and prudent so as to give a true and fair view of the state of the affairs of your Company at the end of the financial year and of the profit of your Company for the Financial Year ended March 31,2021;

(c) except for the findings of the Investigation Report done earlier and the findings of the additional procedures/ enquiries concluded during the year, all of which pertained to earlier years, described in Note 28 in the Notes to the Consolidated Financial Statements and Note 27 in the notes to the Standalone Financial Statements, proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

(d) the Statements have been prepared on a going concern basis for the reasons stated in Note 36 in the Notes to the Consolidated Financial Statements and Note 30 in the notes to the Standalone Financial Statements;

(e) except for certain control lapses identified in the Investigation Report done earlier and in the findings of the additional procedures/enquiries concluded during the year, all of which pertained to earlier years as described in Notes 28 in the Notes to the Consolidated Financial Statements and Note 27 in the Notes to the Standalone Financial Statements, proper internal financial controls have been laid down and that such internal financial controls are adequate and are operating effectively; and

(f) except for the matters on related parties and managerial remuneration, all of which pertained to earlier years described in Note 28 (A) (ii) and 28 (C) (vi) in the Notes to the Consolidated Financial Statements and Note 27 (A) (ii) and 27 (C) (vi) in the notes to the Standalone Financial Statements, there are proper systems in place to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank all doctors, nurses, technicians and staff members who have been battling COVID-19. Their heroic performance under enormous stress is what really makes us a world-class healthcare provider. Your Directors offer their deepest condolences to the bereaved families of Fortisians who lost their loved ones and pray for the early recovery of those who have been infected. Ensuring the health and well-being of our employees, especially the frontline healthcare workers, is paramount and the steps taken towards ensuring their protection during the COVID pandemic is praiseworthy. At the same time, the Fortis team is playing a significant role in the ongoing nation-wide vaccination drive in tandem with the Government directives, reaffirming our pivotal role as a trustworthy healthcare provider.

Your Directors are glad to place on record that Fortis has posted a strong financial performance in spite of the pandemic. This is truly amazing and the Board is proud of each one of you for this achievement. It speaks volumes about your dedication and commitment. Your Board is confident that the team will do much better, as the situation improves. Your Directors are very appreciative of the fantastic work being done and have high hopes that you will continue to deliver wonderful outcomes.

Your Directors also place on record their gratitude to the Central Government, State Governments and all other Government agencies for the assistance, co-operation and encouragement they have extended to the Company. Your Directors also greatly appreciate the commitment and dedication of all the employees at all levels, that has contributed to the growth and success of the Company. Your Directors also thank all the strategic partners, business associates, Banks, financial institutions and our shareholders for their assistance, co-operation and encouragement to the Company during the year.

By Order of the Board of Directors For Fortis Healthcare Limited

Sd/- Sd/-
Ashutosh Raghuvanshi Indrajit Banerjee
MD & CEO Independent Director
DIN:02775637 DIN:01365405
Date: May 29, 2021 Date: May 29, 2021
Place: Gurugram Place: New Delhi

Statement pursuant to first proviso to Sub-Section(3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014 related to subsidiaries

S. Name of the NO. subsidiary Reporting period for the subsidiary concerned, if different from the holding companys reporting period

Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries.

Share capital Reserves & surplus Total assets Total Liabilities Investments Turnover Profit before taxation Provision for taxation Profit after taxation Proposed Dividend % of shareholding *
1 Escorts Heart Institute and Research Centre Limited March SI, 202 I INR 1.00 256.29 57.5SI.02 S7.I55.74 29,3 1 S.43 65,751.05 25,773.72 (2,950.70) (2,950.70) 100.00%
2 Fortis Healthstaff Limited March SI, 202 I INR 1.00 490.00 (1,699.90) 94.S3 1,304.73 - 0.02 (266.22) - (266.22) - 100.00%
3 Fortis Asia Healthcare Pte. Ltd March SI, 202 I USD 73.2 I I 6,2 I 9.40 (124,926.65) 5,204.21 1 13,91 1.47 5.I97.S5 - (2,S 13.94) - (2,SI 3.94) - 100.00%
4 Fortis Healthcare International Pte. Limited March SI, 202 I SGD 54.40 95J6S.I2 (SS ,47 5.35) 7,391.42 69S.65 6,339.44 35.59 (120.69) 0.5S (121.27) 100.00%
5 Men a Healthcare Investment Company Limited March SI, 202 I AED IS.77 I9.S2 (909.50) 34.44 924.1 3 34.44 " " " S2.54%
6 Medical Management Company Limited March SI, 202 I AED IS.77 32.55 744.56 S96.7I 1 19.59 - - - - - - S2.54%
7 SRL Diagnostics FZ-LLC March SI, 202 I AED I 9.94 2S2.00 (2,206.17) 2,615.22 4,539.39 - 1,595.52 (1,530.33) - (1,530.33) - 100.00%
8 Hiranandani Healthcare Private Ltd March SI, 202 I INR 1.00 56 1.33 3,940.55 9.369.S9 4.S6S.0 1 - S,675.27 (145.OS) - (145.OS) - 100.00%
9 Fortis La Femme Limited March SI, 202 I INR 1.00 5.00 (91.93) 2.01 SS.94 - 0.02 (S.04) - (S.04) - 100.00%
10 Fortis CSR Foundation March SI, 202 I INR 1.00 5.00 24.20 3S.22 9.02 - 66.12 6.26 - 6.26 - 100.00%
I I SRL Limited March SI, 202 I INR 1.00 7.S42.55 109,344.37 I36.952.S5 19,765.93 40,350.03 S0,S93.66 12,494.19 3,249.99 9,244.20 - 56.93%
12 SRL Diagnostics Private Limited March SI, 202 I INR 1.00 395.S2 9.S59.29 26,027.47 15,772.36 950.SS 27,666.2S 5.040.SS 677.26 4,363.62 - 100.00%
IS SRL Reach Limited March SI, 202 I INR 1.00 SO 0.00 (S6S.07) 6S7.57 755.64 - 55S.IS (207.10) - (207.10) - 100.00%
14 Fortis Healthcare International Limited March SI, 202 I USD 73.2 I 227.30 1,62S.SS 2,474.3S 6IS.20 - 32.5S (39.25) - (39.25) - 100.00%
15 Fortis Global Healthcare (Mauritius) Limited March 3 I, 202 I USD 73.2 I 373.53 (34,OS 1.42) 1 1 0.89 33.SIS.7S - - (1,451.29) - (1,451.29) - 100.00%
16 Fortis Hospitals Limited March 3 I, 202 I INR 1.00 7,99S.76 (59,292.2 1) 3 57,588.5(0 40S.SS 1.95 42,340.97 203,43 1.13 (26,283.01) 56S.66 (26, S5 1.67) - 100.00%
17 Fortis Cancer Care Limited March 3 I, 202 I INR 1.00 5.00 (3,730.30) 2.2S 3.727.5S - 0.2 1 (294.98) - (294.98) - 100.00%
18 Fortis Malar Hospitals Limited March 3 I, 202 I INR 1.00 1,875.70 6,7S5.SS 1 6.69S.54 S,036.96 5.00 7,732.53 (1,146.66) (345.33) (SO 1.33) - 62.71 %
19 Malar Star Medicare Limited March 3 I, 202 I INR 1.00 5.00 212.SS 225.66 7.7S - 25.25 15.50 1.04 1 4.46 - 62.71 %
20 Fortis Health Management (East) Limited March 3 I, 202 I INR 1.00 5.00 (1,204.98) 34.10 1,234.OS " " (106.53) " (106.53) " 100.00%
21 Birdie and Birdie Realtors Private Limited March 3 I, 202 I INR 1.00 1.00 (1 4,568.59) 9,111.62 23,679.21 " 6.SS (1,838.68) " (1 ,S3S.6S) " 100.00%
22 Stellant Capital Advisory Services Private Limited March 3 I, 202 I INR 1.00 1,750.00 2,9S(J. 55 4.S60.00 129.45 I.2SS.5I 5,700.97 (199.04) S25.79 (1,024.83) 100.00%
23 Fortis Hospotel Limited March 3 I, 202 I INR 1.00 56,1 17.02 149,773.SO 216,303.14 10,412.32 95,340.90 21,507.94 I3.726.S5 3,566.8 1 104 60.04 - 100.00%
24 RHT Health Trust Manager Pte Ltd March 3 I, 202 I SGD 54.40 609.45 10,069.75 1 1,017.71 33S.5I 9.6S2.99 75.IS (469.72) (43.50) (426.22) - 100.00%
25 Fortis Emergency Services Limited March 3 I, 202 I INR 1.00 5.00 (7,190.25) 912.96 S.09S.2 1 - 1 1 6.6S (660.54) - (660.54) - 100.00%
26 Fortis C-Doc Healthcare Limited March 3 I, 202 I INR 1.00 676.77 (3,064.55) 705.53 3,093.31 - U974.S7 (502.99) - (502.99) - 60.00%
27 Escorts Heart and Super Speciality Hospital Limited March 3 I, 202 I INR 1.00 3,392.52 9,219.25 74.0S3.26 6 1,47 1.49 17,775.00 7,775.14 (2,134.41) (530.37) (1,604.04) 100.00%
28 International Hospital Limited March 3 I, 202 I NR I 330 33,963.13 60,067.S5 265,779.03 1 7 1,748.05 S7.90S.52 27,227.29 422.2 1 ISI.7I 240.50 - 1 00.00%
29 Hospitalia Eastern Private Limited March 3 I, 202 I NR 1.00 5.10 (12,297.22) 12,628.46 24,920.5S - OSS (1,702.33) - (1,702.33) - 100.00%
30 Fortis Health Management Limited March 3 I, 202 I NR 1.00 250.00 (5S.S07.46) 62,461.62 12 1,0 19.OS 52,050.02 3,733.31 (7,792.25) - (7,792.25) - 100.00%

* The percentage of shareholding is considered on fully diliuted basis and also includes indirect shareholding.

Notes: The following information shall be furnished at the end of the statement:

1. Names of subsidiaries which are yet to commence operations-Nil

2. Names of subsidiaries which have been liquidated or sold during the year-Refer the section "details of subsidiary, Joint Venture/Associate Companies under Board Report.