Indraprastha Medical Corporation Ltd Directors Report.

Dear Members,

Your Directors are pleased to present the thirty-third Annual Report and the audited financial statements for the financial year ended 31st March 2021.

FINANCIAL RESULTS

Particulars FY 2020-21 FY 2019-20
Income from Operations 6,133.82 8,307.68
Profit before tax 42.89 481.92
Tax Expense 19.60 45.68
Profit for the year 23.29 436.24
Earnings per share 0.25 4.76

RESULTS OF OPERATIONS

During the year under review, the Company recorded a total income of Rs. 6140.60 million against Rs. 8,314.55 million in the corresponding period last fiscal - a decrease by 26%.

The Profit Before Tax for financial year ended 31st March 2021 stood at Rs. 42.89 million as compared to profit of Rs. 481.92 million for the corresponding period of the previous year. The Profit After Tax for year ended 31st March 2021 stood at Rs. 23.29 million as compared to a profit of Rs. 436.24 million for the corresponding period of the previous year.

IMPACT OF THE COVID_19 PANDEMIC ON THE BUSINESS

Due to the continuing COVID-19 pandemic situation, there were localised lockdowns in various parts of the country apart from continuing restrictions on international and domestic travel. This was coupled with advisories issued by the government on postponing elective surgeries and undertaking preventive health checks.

However, the continuance of the pandemic situation resulted in a material impact on the healthcare sector in general, and the Companys healthcare services business operations, due to the following reasons:

Severe travel related restrictions impacting both employee movement and patient _ows to the hospital.

Out Patient footfalls impacted apart from the postponement of elective procedures. Both factors in turn have led to a substantial reduction in the inpatient case-loads.

Continued investment is required in equipment, consumables and other resources to ensure 100% preparedness for safety in the hospital and eventual treatment of patients.

Current embargo on international travel has also impacted patient flows to the hospital.

Impact has been caused by the price capping by the

Delhi Government on diagnostics, including RT-PCR test, and treatment charges for COVID - 19 To meet the surging demand for COVID beds, the hospital created two inflatable COVID shelters with a total capacity of 40 beds, for housing moderately sick COVID patients having relatively good prognosis. The structure was created within 5 days in the Helipad area and was named ‘Nightingale to honour the tireless service of our Nurses.

To reduce dependency on outside sources for medical oxygen, the Government of NCT, Delhi, issued an Advisory directing all hospitals or nursing homes with total bed capacity of 100 or more to install their own PSA/ refilling plants or to create other necessary infrastructure with sufficient capacity to produce at least two times the normal requirement. The Company is in the process of: a) Installing 2.90 metric ton Pressure Swing Adsorption (PSA) oxygen plant; and b) Replacing the existing tanks with 40 metric tons (2*20 metric ton) storage tanks.

Your Company is confident of evolving and adapting to the ever-changing situation on the strength of the experience acquired during the COVID-19 pandemic.

THE STATE OF COMPANY AFFAIRS

The Hospital witnessed a challenging year with multiple waves of the COVID–19 pandemic affecting the lives and livelihoods of the citizens. However, even during this health crisis, the hospital remained committed to providing clinical services for both COVID and non-COVID patients.

While greatly constrained due to resource challenges owing to the lockdown induced supply disruptions, the hospital remained committed to providing world class healthcare and services.

During the year under review, the following rare procedures were performed at the Hospital: -

A two-and-a-half-month-old baby from Myanmar with multiple co-morbidities underwent BT shunt surgery and was discharged in a stable condition.

The bone marrow transplant team successfully performed haploidentical transplant in the first diagnosed case of Nuclear Factor Erythroid-derived

2 (NFE2) deficiency, which is a new mutation reported for the first time in the British Journal of Haematology (BJH).

A 6-year-old girl diagnosed with severe aplastic anemia underwent bone marrow transplant, where she received stem cells from her brother. She has recovered very well.

A 6-month-old infant from Iraq was diagnosed with complex cyanotic heart disease and underwent a high risk arterial switch surgery. The child was discharged in a stable condition with a highly improved long-term outcome.

A 5-month-old baby from Yemen, underwent Heart

Transplantation. He was discharged in a stable condition.

A 53-year-old female patient was admitted with a complaint of severe abdominal pain accompanied with a huge abdominal swelling and vomiting. CECT abdomen revealed a multiseptal ovarian cyst. Laparotomy was performed on the patient and a 50-kg tumor was removed.

The National Board of Examinations in Medical Sciences (NBEMS) has granted accreditation to Indraprastha

Apollo Hospitals in thirty-five specialities which includes four specialities in Fellow of National Board (FNB), twenty specialities in Doctorate of National Board (DrNB) and eleven specialities in Diplomate of National Board (DNB). Indraprastha Apollo Hospitals started new FNB course in Arthroplasty, DrNB course in Vascular Surgery & CTVS. Further, to boost up academics, weekly clinical presentations are organised for Consultants, FNB/DrNB/

DNB trainees and Junior Medical staff.

On a Public Interest Litigation (PIL) regarding free treatment in the hospital, the Honble Delhi High Court vide its order dated 22nd September, 2009 has held that free treatment provided by the hospital shall be inclusive of medicines and consumables.

The Company has filed a Special Leave Petition (SLP) before the Honble Supreme Court challenging the order of the Honble Delhi High Court. The Honble Supreme Court of India has admitted the SLP and has passed an interim order on 30th November, 2009. In pursuance of the said interim order, the Company has been providing free treatment to the patients referred by the Government of NCT of Delhi and has been charging only for medicines

& medical consumables. The financial impact in the matter can be quantified only after the final decision by the Honble Supreme Court of India.

The Directorate of Health Services, Government of NCT of Delhi has appointed a Nodal Medical Officer to be permanently stationed in the Hospital to support, guide and monitor the treatment of patients referred by the Government.

The Company has moved an Interlocutary Application before the Honble Supreme Court seeking direction that the conditions relating to provision of free treatment facilities for patients belonging to indigent category to the extent of 10% IPD and 25% OPD be made applicable to the Company as have been made applicable in case of other hospitals. Additionally, the Company has also made representations before the Government of NCT of Delhi to allow the Company to extend free treatment including medicines and consumables up to 10% IPD and 25% OPD as applicable to other hospitals.

During the year, a total of 20653 patients (18509 Out Patients and 2144 In Patients) were treated under the free category.

Despite the factors which impacted the growth of revenue, various initiatives have been taken to improve the overall business, financial and operational performance of the

Company. Some of the initiatives are enumerated below:-

Digital Transformation

The hospital continued its transformative journey towards digitization and improving access of resources for patients. The paperless transformation project in outpatient areas was initiated and is in the process of full implementation. Similarly, the hospital utilized the power of information technology to ramp up its telemedicine presence through the Apollo 24/7 App. These capabilities helped the Hospital ensure continuum of care during lockdowns and COVID - 19 waves.

Staff Safety

The hospital laid special emphasis on the safety of staff in a tenuous year that witnessed the pandemic. Front-line staff were provided appropriate Personal Protective

Equipment (PPEs). Training on personal protection and escalation matrices as per laid out protocols for COVID - 19 cases was also imparted.

Accreditation

Healthcare accreditation is one of the major steps towards improving quality and patient safety. Your Hospitals has been accredited by the following agencies: -

Indraprastha Apollo Hospitals was the first hospital in the country to get Joint Commission International (JCI) accreditation in the year 2005. It has been re-accredited for the sixth time in December 2020.

Laboratory Services at Indraprastha Apollo Hospitals has been re-accredited by National Accreditation

Board for Testing & Calibration Laboratories (NABL) Apollo Hospital, Noida, has been re-accredited by National Accreditation Board for Hospital and Healthcare Providers (NABH)

Awards and Accolades

The Hospital received a number of awards and accolades during the year. Some of them are as under:-

Award Category / Project Awarded
Hospital Management Asia Talent Development –
We care for our warriors
Apollo Innovation Best HR Practices –
We care for our warriors
AHPI Healthcare Excellence COVID Management
Award 2021

MATERIAL CHANGES AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material change and commitment affecting the financial position of the Company, has occurred between the financial year ended on 31st March, 2021, and the date of the report. There has been no change in the nature of business of the Company.

TRANSFER TO RESERVES

The Company does not propose to transfer any amount to the General Reserve out of the amount available for appropriation in the current year.

DIVIDEND

The financial year 2020-21 saw a major impact on the Companys operations due to the lockdowns and postponement of many elective procedures, surgeries and consultations. Despite the odds, your Company continued to serve patients through the digital health ecosystem with virtual consulting and other services on the Apollo 24/7 platform. The business showed resilience and saw some recovery in the last quarter of the financial year 2020-21.

The unprecedented 2nd wave of the COVID-19 pandemic in the first quarter of financial year 2021-22 has once again led to an upheaval in the economy. The new variants are leading to a rise in COVID cases globally and are adding to the unpredictability of how long this crisis will last. Under the circumstances, your Directors felt, it is prudent to preserve cash to meet contingencies arising out of an unknown state of affairs with a looming threat of a 3rd wave. Keeping in view the uncertain situation and the potentially challenging business environment, your Board has decided not to declare a dividend for the financial year 2020-21. Further, being a social institution doing good for the society, the Board thought it prudent to preserve the cash reserve of the Company.

The Board approved and adopted a dividend distribution policy at its meeting held on 9th June, 2021, which is posted on the Companys website: https://delhi. apollohospitals.com/

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company has no subsidiaries or associate companies. Also, it does not have any joint venture operation with any other entity.

CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The report on corporate governance as required under the Listing Regulations, forms an integral part of this report. The requisite certificate from Mr. Baldev Singh Kashtwal, Practicing Company Secretary, confirming the compliance with the conditions of corporate governance is attached to the report on Corporate Governance.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under Regulation 34 of the Listing Regulations, forms an integral part of this report.

BUSINESS RESPONSIBILITY REPORT

As stipulated under the Listing Regulations, the Business Responsibility Report describing the initiatives undertaken by the Company from an environmental, social and governance perspective is attached as part of the Annual Report.

SEXUAL HARASSMENT

Your company strongly believes in providing a safe and harassment free workplace for every individual working with us through various interventions, policies and practices. The Company always endeavors to create and provide an environment that is free from discrimination and harassment including sexual harassment.

The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at the workplace in line with the provisions of the Sexual

Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed thereunder. The Company has an Internal Complaints Committee (ICC) for providing a redressal mechanism pertaining to sexual harassment of women employees at the work place. During the year, the ICC received nine complaints. Detailed investigations were carried out and appropriate actions taken by the management in all the reported incidents. One complaint was being investigated and pending as on 31st March, 2021.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has established a vigil mechanism for Directors and Employees to report their genuine concerns, the details of which are given in the Corporate Governance Report. The Whistle Blower Policy may be accessed on the Companys website on the https://delhi. apollohospitals.com/downloads/Whistle%20Blower%20

Policy.pdf

During the year, no matter or incident has been received under the Whistle Blower Policy of the Company.

PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDED

During the year, the Company has not given any loan or made an investment, nor given any guarantee in terms of Section 186 of the Companies Act, 2013.

DEPOSITS

During the year, the Company has not accepted any deposit under Chapter V of the Companies Act, 2013.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Board Composition and Independent Directors

As on 31st March 2021, the Board consisted of the Non-Executive Chairman, one Executive Director, six Non-Executive Directors and eight Independent Directors. Independent directors are appointed for a term of five years and are not liable to retire by rotation based on the recommendation of the Nomination and Remuneration Committee. In the opinion of the Board, the Independent Directors fulfil the conditions specified in the Listing Regulations and are independent of the management. All Independent Directors have given their declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(b) of the SEBI Listing Regulations.

Retirement by Rotation

Pursuant to Section 152 of the Companies Act 2013, Ms. Suneeta Reddy and Ms. Sangita Reddy, Directors, retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Change in Board Composition

The following changes have taken place in composition of the Board: -

Mr. Jasmine Shah has been appointed as Director &

Chairman (Non-Executive Chairman)

Prof. (Dr.) Mahesh Verma, Mr. Udit Prakash Rai and

Mr._ Vikram Bhat have been appointed as Non-Executive Directors.

Mr. Salil Singhal has been appointed as an Independent

Director for five consecutive years from 8th February, 2021 to 7th February, 2026

Mr. Vinayak Chatterjee has been re-appointed as an

Independent Director for five consecutive years from 1st April, 2021 to 31st March, 2026.

Ms. Vineeta Rai has resigned as a Nominee Director of

Govt. of NCT of Delhi (Non-Executive Director). Ms. Vineeta Rai has been appointed as an Independent Director for five consecutive years effective from 8th

February, 2021 to 7th February, 2026.

Ms. Madhumita Ganguli has resigned as Non-

Executive Director. Ms. Madhumita Ganguli has been appointed as an Independent Director for five consecutive years effective from 9th June, 2021 to 8th June, 2026.

Based on the recommendation of the Nomination and Remuneration Committee, the Board has recommended to the members the re-appointment of Mr. P. Shivakumar as Managing Director of the

Company for a period of 3 years effective from 5th_November, 2021.

Key Managerial Personnel

Pursuant to the provisions of Section 203 of the

Companies Act, 2013, the Key Managerial Personnel of the Company are Mr. P. Shivakumar - Managing Director,

Mr. Chander Prakash Tyagi - Chief Financial Officer and Mr. Priya Ranjan - Associate Vice President - Corporate

Affairs & Legal.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and in terms of Regulation 17(10) of the SEBI Listing

Regulations, the Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the working of the Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

REMUNERATION POLICY

The Board has, on the recommendation of the Nomination and Remuneration Committee, approved a policy for selection and appointment of Directors, Senior

Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

MEETINGS OF THE BOARD

The Board met four times during the financial year, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013, read with the Listing Regulations.

RISK MANAGEMENT

The Board of Directors had constituted a Risk Management Committee to identify elements of risk in different areas of operations and to develop a policy for actions associated to mitigate the risks. The Committee on a timely basis informed the members of the Board about risk assessment and minimization procedures and in the opinion of the Committee there was no risk that may threaten the existence of the Company. The details of the Risk Management Committee are included in the Corporate Governance Report.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations.

To maintain its objectivity and independence, the Internal Audit function reports to the Audit Committee. The details of the internal control system and its terms of reference are set out in the Management Discussion and Analysis Report forming part of the Boards Report.

The Board of Directors has laid down internal financial controls to be followed by the Company and the policies and procedures to be adopted by the Company for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. The Audit Committee evaluates the internal financial control systems periodically.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant material orders passed by the

Regulators / Courts which would impact the going concern status of the Company and its future operations.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013, the Board of Directors to the best of their knowledge hereby state and confirm:

a. that in the preparation of the annual financial statements for the year ended 31st March, 2021, the applicable accounting standards have been followed along with proper explanations relating to material departures, if any;

b. that such accounting policies have been selected and applied consistently, and judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2021, and of the pro_t of the Company for the year ended on that date;

c. that proper and sufficient care has been taken 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. that the annual financial statements have been prepared on a going concern basis;

e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively;

f. that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arms length basis. During the year, the Company has not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

The policy on materiality of related party transactions as approved by the Board may be accessed on the

Companys website at https://delhi.apollohospitals.com/ downloads/materiality-of-related-party-transactions.pdf

Your Directors draw the attention of the members to Notes to the financial statements which sets out related party disclosures. None of the Directors have any pecuniary relationships or transactions vis-a-vis the Company.

PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules are provided in the Annual Report, which forms part of this Report. Disclosures relating to remuneration and other details as required under Section 197(12) of the Act read with Rule

5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are also provided in the Annual Report, which forms part of this Report.

Having regard to the provisions of Section 136(1) read with the relevant provisions of the Companies Act, 2013, the Annual Report excluding the aforesaid information is being sent to the members of the Company. The said information is available for inspection at the Registered Office of the Company during working hours. Any member interested in obtaining such information may write to the Company Secretary and the same will be furnished free of cost.

EMPLOYEE STOCK OPTIONS

No Employee Stock Options have been granted to the employees of the Company.

INDUSTRIAL RELATIONS

The Industrial Relations continued to be cordial during the year under review.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

As part of its initiatives under Corporate Social Responsibility (CSR), the Company has undertaken projects in the areas of Rural Development, Healthcare,

Education & Skill Development and Research in

Healthcare.

These projects are in accordance with Schedule VII of the Companies Act, 2013. The Report on CSR activities for the financial year 2020-21 is annexed herewith marked as Annexure – 1 to this Report.

STATUTORY AUDITORS

The Members at the Annual General Meeting held on 26th

September 2017 approved the appointment of M/s. S.N. Dhawan & Co. LLP, Chartered Accountants, as statutory auditors for a period of five years commencing from the twenty-ninth Annual General Meeting till the conclusion of the thirty-fourth Annual General Meeting subject to ratification by the Members every year. Pursuant to amendments in Section 139 of the Companies Act, 2013, the requirements to place the matter relating to such appointment for ratification by members at every annual general meeting has been dispensed with effect from 7th May, 2018 and the appointment of M/s. S.N.

Dhawan & Co. LLP, Chartered Accountants, as statutory auditors is valid till the conclusion of the thirty-fourth Annual General Meeting to be held during the year 2022.

There are no qualifications, reservation or adverse remarks made by the statutory auditors in the audit report. No instances or matters of fraud have been reported by the Auditors.

COST AUDITORS

Pursuant to Section 148 of the Companies Act,

2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014, the Directors on the recommendation of the Audit Committee, appointed

M/s Devarajan Swaminathan and Co., Cost Accountants

(FRN 100669) to audit the cost accounts of the Company for the financial year 2021-2022 on a remuneration of Rs. 5.50 lakhs.

As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the members in a general meeting for their ratification. Accordingly, a resolution seeking members ratification for the remuneration payable to

M/s Devarajan Swaminathan and Co., Cost Accountants

(FRN 100669) is included at Item No. 6 of the Notice convening the Annual General Meeting.

The Company has maintained cost records in accordance with the provisions of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Amendment Rules, 2014 in respect of healthcare services.

SECRETARIAL AUDITORS

The Board had appointed M/s RSM & Co., a firm of Company Secretaries in Practice, to conduct Secretarial

Audit for the financial year ended 31st March, 2021. The

Secretarial Audit Report for the financial year ended

31st March, 2021, is annexed herewith marked as Annexure – 2, to this Report.

During the period under review, the Company has complied with the provisions of the Act, Rules,

Regulations, Guidelines, Standards etc. covered under the Secretarial Audit, save the Govt. of NCT of Delhi - one of the promoters of the Company, have not dematerialized their shareholding in the Company. Requests have been made by the Company to the Govt. of NCT of Delhi to get their shareholding dematerialized.

Further, an Independent Woman Director was required to be appointed by the Company, as required under Regulation 17(1)(a) of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015 by 31st March, 2020. The Company was in the process of identifying and appointing Woman Independent Director before 31st March, 2020, but due to COVID - 19 Pandemic and nationwide restrictions & complete lockdown imposed in the country during the month of March, 2020, the appointment of Woman Independent Director by the Board of Directors of the Company could not take place by 31st March, 2020. However, Dr. Menaka Guruswamy has been appointed as the Woman Independent Director on 23rd May, 2020.

PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO.

Information as required to be disclosed on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, is annexed herewith marked as Annexure – 3 to this Report.

EXTRACT OF ANNUAL RETURN

In accordance with the provisions of Section 92(3) read with section 134(3)(a) of the Companies Act, 2013 and Rules framed thereunder, an annual return in the prescribed format for the financial year 2020-21 is available on the website of the Company at https://delhi. apollohospitals.com/annual-report.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation of the contribution made by the employees at all levels, towards the continued growth and prosperity of your Company.

Your Directors also wish to place on record their appreciation of business constituents, banks and other financial institutions, the Government of Delhi and shareholders of the Company for their continued support.

For and on behalf of the Board
Jasmine Shah
Chairman
(DIN 08621290)
Place: New Delhi
Date : 9th August, 2021