Nectar Lifescience Ltd Directors Report.

OF NECTAR LIFESCIENCES LIMITED

Dear members,

Your Directors have pleasure in presenting the 26th Annual Report together with the audited financial statements of Nectar Lifesciences Limited (‘NLL or ‘Neclife or ‘Nectar or ‘the Company) for the financial year ended March 31, 2021.

Financial results

INR in Millions

31-Mar-21 31-Mar-20
Gross Sales (Including GST) 17622.69 26392.81
Other Income 37.94 43.62
Profit before interest and depreciation & exceptional items 1129.49 2223.32
Interest 1120.32 1258.23
Depreciation & Amortization 602.53 607.66
Profit (Loss) before exceptional items & tax (593.36) 357.43
Exceptional items (Net of Tax) 253.15 -
Profit (Loss) before tax (846.51) 357.43
Tax expenses (115.04) 56.82
Profit (Loss) after tax (731.47) 300.61
Other Comprehensive income (Net of Taxes) 3.94 12.62
Profit (Loss) after tax available for Appropriations (727.53) 313.22

The Companys revenue during Financial Year (‘FY) 2020-21 stood at INR 17,623/- Millions against INR 26,393/- Millions in the previous year recording a decline of 33%. The Financial Statements for the year ended on March 31, 2021 of the Company are attached.. The detailed discussion on Companys various operations, state of affairs, nature of business, material changes, if any, financial position and Covide-19 impact on operations and finances are set out in

Management Discussion and Analysis Report ("MDA"). The MDA of financial condition and result of operations of the Company for year under review as required under Securities & Exchange Board of India (‘SEBI) (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("LODR Regulations"), is given as Annexure 1 and forms and part of this report. Any disclosure not given in this report and its annexures but disclosed in Annexure 1, shall be deemed to be reported in this report and vice versa.

There has been no change in the nature of business of the Company.

The financial results of the company for the quarter ended on June 30, 2021 will be made available on the website of the company (URL: www.neclife.com).

Indian Accounting Standards (IndAS) and Secretarial Standards

The company has adopted Indian Accounting Standards (Ind AS) prescribed under section 133 of the Companies Act, 2013, read with the relevant rules issued there under and accordingly, standalone and consolidated audited financial statements have been prepared in accordance with the recognition and measurement principles laid down in Ind AS and the other accounting principles generally accepted in India.

The Company is in Compliance of Secretarial Standards as issued by Institute of Company Secretaries of India.

Corporate Governance

The Company aimed to conduct its affairs in an ethical manner. A separate Report on Corporate Governance is given as Annexure 2 and forms and part of this report. A certificate from the Companys Auditors regarding the Compliance of Conditions of Corporate Governance as stipulated under LODR Regulations is given in Annexure 3. Any disclosure not given in this report and its annexures but disclosed in Annexure 2, shall be deemed to be reported in this report and vice versa.

Business Responsibility (‘BR) Statement

The BR Report as required under LODR Regulations, is given as Annexure 9.

Share capital

The paid up equity share capital as on March 31, 2021 was INR 224.26 Millions. There was no public issue, rights issue, bonus issue or preferential issue, etc. during the financial year. The Company has not issued shares with differential voting rights, sweat equity shares, nor has it granted any stock options.

Global Depository Receipts (GDRs)

The Company has 46,000,000 equity shares of INR 1/- each underlying 46,000,000 Global Depository Receipts (GDRs). The GDRs are listed on: Luxembourg Stock Exchange/ LuxSE

Societe de la Bourse de Luxembourg S.A. B.P. 165, L-2011 Luxembourg Siege social, 11, av de la Porte-Neuve, Telephone: (352) 47 79 36 1, Fax: (352) 47 32 98

Subsidiary companies

The company has wholly owned subsidiaries (WOS) namely Nectar Lifesciences UK Limited, incorporated in United Kingdom, NECLIFE PT, UNIPESSOAL LDA, incorporated in Portugal and Nectar Lifesciences US, LLC, incorporated in United States. There are negligible investments in Nectar Lifesciences UK Limited and NECLIFE PT, UNIPESSOAL LDA and no business activity has been carried out in them in financial year 2020-21 and till date in financial year 2021-22. Therefore, nothing is to report on the performance and financial position ofNectar Lifesciences UK Limited and NECLIFE PT, UNIPESSOAL LDA. However, the Nectar Lifesciences US, LLC doing the business operations of trading of pharmaceutical products. The company incurred the loss of US$ 0.01 Million during the year under review as compared to profit of US$ 0.07 Million during last year. Pursuant to the provisions of Section 129(3) of the Companies Act, 2013 (hereinafter referred as ‘Act), a statement containing salient features of financial statements of subsidiaries, associates and joint venture companies in Form AOC-1 is attached to the Financial Statements. The separate financial statements in respect of each of the subsidiary companies shall be kept open for inspection at the Registered Office of the Company during working hours for a period of 21 days before the date of the Annual General Meeting (AGM). Your Company will also make available these documents upon request by any Member of the Company interested in obtaining the same. The separate audited/ unaudited financial statements in respect of each of the subsidiary companies are also available on the website of your Company at www.neclife.com.

None of the subsidiaries is material as per Policy for determining Material Subsidiaries of the Company and LODR Regulations.

Consolidated financial Statements

As required under Section 129 of the Act and LODR Regulations, a consolidated financial statements for the year ended on March 31, 2021 of the Company are attached.

Dividend, Reserves and Dividend Distribution Policy

Considering the losses incurred by the company during the FY 2020-21, your Directors are not recommending a Dividend for the year ended March 31, 2021.

The members may please refer to notes of Notice of AGM for information on shares/dividend transferred / proposed to be transferred to IEPF Authority.

The Board of Directors of your Company has decided not to transfer any amount to the Reserves for the year under review. The Board of Directors in their Meeting held on July 23, 2021 have approved the Dividend Distribution Policy which is placed on the website of the Company at https://neclife.com/uploads/1627101476495560955.pdf .

Directors and Key Managerial Persons

Dr. Dinesh Dua (DIN 02436706), Director will retire by rotation in the forthcoming AGM and being eligible, offer himself for re-appointment. The Board recommends his re-appointment as a Director. Dr. (Maj Gen.) S.S. Chauhan, VSM, DIN-02954776, Independent Director of the company expired on November 22, 2020. The Board put on record their deepest appreciation and gratitude to late Major Gen. (Dr.) S. S. Chauhan for having been on the Board of the Company for more than a Decade. During his wonderful association with the Company, Dr. Chauhan not only advised with his knowledge, skills, vast experience but also with wonderful insights. Dr. Dinesh Dua has been re-appointed as Wholetime Director designated as Executive Director by the Board of Directors in their meeting held on July 23, 2021 w.e.f. October 14, 2021 for a period of One year. Based on recommendation of Nomination and Remuneration Committee, the Board recommends his re-appointment as a Wholetime Director.

Mr. Sanjiv Goyal (DIN-00002841) has been re-appointed as a Chairman & Managing Director of the company w.e.f. May 31, 2022 for a period of 3 years by the Board of Directors in their meeting held on July 23, 2021. Based on recommendation of Nomination and Remuneration Committee, the Board recommends his re-appointment as a Wholetime Director.

Based on recommendation of Nomination and Remuneration Committee and pursuant of provisions of Section 149, 150, 152, Schedule IV and other applicable provisions of the Companies Act, 2013 and LODR Regulations, the Board of Directors in their meeting held on February 13, 2021 have appointed Maj. Gen. (Retd.) Dr. Ajit Singh Dhillon (DIN 09032214) as an additional director in the capacity of Independent Director of the company and he had to vacate his office at the ensuingAGM. He had resigned from the Board with effect from June 24, 2021 due to old age and health reasons.

As on the date end of FY, the company has right proportionate of Independent Directors viz a viz Non-Independent Directors as per applicable provisions of Section 149 of the Act, and LODR

Regulations.

The Company has received declarations from all the Independent Directors of the Company confirming that

1. They meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Act, and under LODR

Regulations.

2. They have submitted a declaration of compliance of sub-rule (1) and sub-rule (2) of Rule 6 of Companies (Appointment and Qualifications of Directors) Rules, 2014.

Your Directors do hereby confirm that in the opinion of the board, the independent directors fulfill the conditions specified in the Act and LODR Regulations and are independent of the management. Pursuant to the provisions of Section 203 of the Act, the key managerial personnel of the Company as on March 31, 2021 were as under: Mr. Sanjiv Goyal, Chairman & Managing Director Dr. Dinesh Dua, Wholetime Director designated as Executive Director Mr. Amit Chadah, Chief Executive Officer rOffice Mr.SandeepGoel,ChiefFinancial Ms. Sukriti Saini, Company Secretary Ms. Sukriti Saini, Company Secretary has resigned w.e.f. June 15, 2021. Ms. Anubha has been appointed as a Company Secretary & Compliance Officer with effect from August 1, 2021.

Number of meetings of the board

Eight (8) meetings of the board were held during the year. The details of Directors and meeting held during the financial year 2020-21 are provided in Corporate Governance Report which forms and part of this report.

Directors responsibility statement

The Directors confirm that:

in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same; they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profits of the Company for that period; they have taken proper and 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; they have prepared the annual accounts on a going concern basis; they have laid down internal financial controls for the Company and such internal financial controls are adequate and operating effectively; and they have devised proper systems to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

Board evaluation

Pursuant to the provisions of the Act, and the corporate governance requirements as prescribed by LODR Regulations, the performance of the Board and committees was evaluated by the Board after seeking inputs from all the directors/ committee members on the basis of the criteria such as the Board/ committee composition and structure, effectiveness of board processes, information and functioning, etc. The Board and the Nomination and Remuneration Committee ("NRC") reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role. The performance evaluation forms of each of director get filled from all directors. In a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated.

Policy on directors appointment and remuneration and other details

The Companys policy on directors appointment and remuneration and other matters namely Nomination, Remuneration and Evaluation Policy as provided in Section 178(3) of the Act has been uploaded on the website of the company at https://neclife.com/uploads/1549887491137395438.pdf. The salient features of the Policy are to provide a framework and set standards for the nomination, remuneration and evaluation of the Directors, Key Managerial Personnel and officials comprising the senior management The Company aims to achieve a balance of merit, experience and skills amongst its Directors, Key Managerial Personnel and Senior Management. The remuneration / compensation / commission etc., to the Directors, Key Managerial Personnel and Senior Management are determined by the Nomination and Remuneration Committee and recommended to the Board for its approval. There is no change in the policy during financial year 2020-21.

Committees of the Board

The Company constituted the Committees as per the provisions of Sections 177 and 178 of the Act and LODR Regulations. The composition, powers and duties of the Committees, during financial year 2020-21, are detailed out in the Corporate Governance Report which forms and part of this report. The Board of Directors accepted all recommendations of the Audit Committee.

Internal financial control systems and their adequacy

The company has adequate financial controls. The details in respect of internalfinancial control and their adequacy are included in the Management Discussion & Analysis, which forms part of this report.

Auditors and Auditors Report

M/s Ashwani K. Gupta & Associates, Chartered Accountants (ICAI Registration No. 003803N) were appointed as Statutory Auditors of your Company at the AGM held on September 28, 2017 for a term of five consecutive years. In accordance with the Companies Amendment Act, 2017, enforced on 7th May, 2018 by the Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every AGM.

The Report given by the Auditors on the financial statements of the Company is part of the Annual Report. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report.

No fraud has been reported by the Auditors to the Audit Committee or the Board.

Secretarial Auditor and Secretarial Audit Report

During the year, Secretarial Audit was carried out by Mr. Prince Chadha of P. Chadha & Associates, Practicing Company Secretary, the Secretarial Auditor of the company for the Financial Year 2020-21. The Secretarial Audit Report is appended as an Annexure 4 to this report.

There is a remark in the sub point B of Point I of said report that the Financial Results for the quarter ended on June 30, 2020 had been submitted on October 01, 2020 causing delay of 16 days in submission.

The Company had made the default good and paid the requisite fine to BSE limited ("BSE) and National Stock Exchange of India Limited ("NSE) as per SEBI Circular dated January 22, 2020. The reason for delay had been submitted by the Company to BSE and NSE as per SEBI Circular dated November 19, 2018 as due to some of staff members from Accounts Department got infected with COVID-19, and were quarantined. This had caused immense disruption in the day to day workings of accounts department and delay in preparation of financial results for the quarter ended on June 30, 2020. On request of the Company, the NSE and BSE has waived the levy of fine refunded/ adjusted the already paid fine. The Company has undertaken an audit for the financial year 2020-21 for all applicable compliances as per Securities and Exchange Board of India Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance Report has been submitted to the stock exchanges within 60 days of the end of the financial year.

Cost Records and Audit

The Company is required to maintain cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013 and accordingly such accounts and records are made and maintained.

The last date for submission of Cost Audit Report for financial year 2019-20 by Cost Auditor to the Board of Directors was extended to November 30, 2020 by Ministry of Corporate Affairs vide circular dated September 10, 2020 which is to be filed by the 30 days of submission. The Cost Auditor has submitted the Cost Audit Report for the financial year 2019-20 on November 27, 2020 which has been filed on December 07, 2020 within the prescribed time. The Cost Auditor shall forward the Cost Audit Report for the financial year 2020-21 by September 30, 2021. The report will be filed with Ministry of Corporate Affairs within 30 days of date of Cost Audit Report.

The company has appointed Dr. Vimal Kumar (Membership No. 9982) prop. of M/s V. Kumar and Associates, SCF 13, GF, VIP Galleria Market, VIP Road, Zirakpur, SAS Nagar (Mohali) Punjab-140603, Cost and Works Accountants as the Cost Auditors of the Company for the financial year 2021-22.

Risk management

The development and implementation of risk management policy has been covered in the management discussion and analysis, which forms part of this report.

Annual Report 2020-21/ 11

Though not mandatory during 2020-21, the Company has constituted a Risk Management Committee with Dr. Dinesh Dua as the Chairman and Mr. Harparkash Singh as a member. However, on October 01, 2020, the company has reconstituted the Risk Management Committee vide which Mr. Harparkash Singh was replaced with Mr. Amit Chadah.

1. Dr. Dinesh Dua - Chairman

2. Mr. Amit Chadah - Member

The terms of reference of the committee are provided in the Corporate Governance Report which forms and part of this report. The audit committee has additional oversight in the area of financial risks and controls. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis.

Particulars of loans, guarantees and investments

The company has not given any loan or provide guarantee as per Section 186 of the Act, however, the amount receivable from subsidiaries and the investments under section 186 of the Act are given in the Financial Statements forming part of the Annual Report.

Transactions with related parties

Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure 5 in Form AOC-2 and the same forms part of this report. Further details about these transactions are provided in Report on Corporate Governance.

Corporate social responsibility

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Company and the initiatives undertaken by the Company on CSR activities during the year are set out in Annexure 6 of this report in the format prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014. The policy is available on the website of the Company.

Annual Return and Extract of annual return

As provided under Section 92(3) of the Act, the MGT-7 (Annual Return) is also available on the website of the company at http://www.neclife.com/uploads/16277278781766989118.pdf.

Employees

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as Annexure 7. In terms of proviso to Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars as required pursuant to provisions of Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The said information is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing AGM. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard. This information is also available on the website of the Company (URL: www.neclife.com).

Fixed deposits

During the year under Report, your Company did not accept any deposits from the public in terms the provisions of Companies Act, 2013.

Disclosure requirements

As per LODR Regulations, corporate governance report with auditors certificate thereon and management discussion and analysis are attached, which form part of this report.

Details of the familiarization programme of the independent directors are available on the website of the Company (URL: www.neclife.com).

Policy for determining material subsidiaries of the Company is available on the website of the Company (URL: www.neclife.com).

Policy on dealing with related party transactions is available on the website of the Company (URL: www.neclife.com).

The Whistle Blower Policy to provide Vigil Mechanism for employees including directors is available on the website of the Company (URL: www.neclife.com).

Committee and Policy against Sexual Harassment at Workplace

The company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The company has made the Anti Sexual Harassment Policy under above referred Act for all individuals working for Nectar at all levels and grades, including senior executives, officers, employees (whether permanent, fixed-term or temporary), consultants, contractors, trainees, staff, casual workers, interns. As per policy any aggrieved woman employee who feels and is being sexually harassed directly or indirectly may make a complaint of the alleged incident to any member of the Committee constituted for this purpose.

Disclosures in relation to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013: a. number of complaints pending as on April 01, 2020 - NIL b. number of complaints filed during the financial year 2020-21 - Nil c. number of complaints disposed of during the financial year 2020-21 N.A. d. number of complaints pending as on March 31, 2021 - N.A.

Energy, technology and foreign exchange

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under the Act, are provided in Annexure 8 to this Report.

Acknowledgement

Your Directors would like to express their sincere and grateful appreciation for the assistance and cooperation received from bankers and government authorities and also thank the shareholders for the confidence reposed by them in the Company and looking forward to their valuable support in the future plans of the Company. Your Directors also thank its agents, the medical professionals and its customers for their continued patronage to the Companys products.

For and on behalf of the Board of Directors
of Nectar Lifesciences Limited
Dated: 23-07-2021
Place: Chandigarh
(Sanjiv Goyal)
Chairman and Managing Director