Regency Hospital Ltd Directors Report

1 Resigned with effect from 30 September 2024 AUDIT COMMITTEE

The Board has constituted a well-qualified Audit Committee. The Companys Audit Committee comprises of Mr. Rajiv Kumar Bakshi, Independent Director as the Chairman, Mr. Ajay Kumar Saraogi, Additional Director-Independent and Dr. Atul Kapoor, Managing Director as members of the Committee. The Committee performs the functions as enumerated in Section 177 of the Companies Act, 2013. The meetings of Audit Committee are also attended by other Directors, Chief Financial Officer, Statutory Auditors and Internal Auditor as special invitees. The Company Secretary acts as the Secretary to the Committee. The minutes of each Audit Committee meeting are placed in the next meeting of Board and Audit Committee.

During the year, the Audit Committee met three (3) times on 4 June 2024, 3 September 2024, and 23 December 2024. Mr. Rajiv Bakshi attended the meetings held on 4 June 2024 and 3 September 2024. He ceased to be a member of the Committee thereafter. Mr. Rajiv Bakshi and Dr. Atul Kapoor attended all three meetings of the Audit Committee.

NOMINATION AND REMUNERATION COMMITTEE

In adherence to Section 178(1) of the Companies Act, 2013, the Board of Directors had approved a policy on Directors appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a Director, and other matters provided under Section 178(3) based on the recommendations of the Nomination and Remuneration Committee. The policy is available on the website of the Company at https://regencvhealthcare.in/wp-content/uploads/Nomination-Policv.pdf. The broad parameters covered under the Policy are Company Philosophy and Principles on Nomination and Remuneration of Directors, Nomination and Remuneration of the Key Managerial Personnel (Other than Managing/ Whole-time Directors), Key-Executives and Senior Management.

The Nomination and Remuneration Policy of the Company, inter alia, provides that the Nomination and Remuneration Committee shall: (i) Formulate the criteria for determining qualifications, positive attributes and independence of a director. (ii) Identify persons who are qualified to become Director and persons who may be appointed in Key Managerial and Senior Management positions in accordance with the criteria laid down in this policy. (iii) Recommend to the Board, appointment and removal of Director, KMP and Senior Management Personnel.

The Companys Nomination and Remuneration Policy is enclosed to this Boards Report as an Annexure A.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

During the financial year 2024-25, the Company has spent Rs. 8.40 Mn towards Corporate Social Responsibility (CSR) expenditure, in terms of the CSR annual action plan approved by the CSR Committee and the Board of Directors, from time to time. The Annual Report on CSR activities, in terms of Section 135 of the Companies Act, 2013 and the Companies (Corporate Social Responsibility Policy) Rules, 2014 (“CSR Rules”) is set out in Annexure B to this Report.

The CSR policy is available on the website of Company at http://regencyhealthcare.in/wp- content/uploads/Corporate-Social-Responsibility-Policy.pdf.

The CSR Policy outlines its Companys CSR initiatives which are implemented through its CSR arm/ trust i.e. Amrita Charitable Trust, which focuses on Special Education, Psychological Evaluation and Intervention, Occupational therapy, Physiotherapy and Speech Therapy. As per the aforesaid Policy, RHL shall undertake CSR activities as prescribed under the Companies Act, 2013 (“the Act”) read with Schedule VII of the Act.

The CSR Committee confirms that the implementation and monitoring of the CSR Policy was done in compliance with the CSR objectives and Policy of the Company.

PERFORMANCE EVALUATION

In terms of the requirement of the Act, an annual performance evaluation of the Board was undertaken which included the evaluation of the Board as a whole and peer evaluation of the Directors. The criteria for performance evaluation cover the areas relevant to the functioning of the Board such as its composition and operations, Board as whole and group dynamics, oversight and effectiveness, performance, skills and structure etc. The performance of individual Directors was evaluated on the parameters such as preparation, participation, flow of information, conduct, independent judgement, and effectiveness. The performance evaluation of Independent Directors was done by the entire Board of Directors and in the evaluation of the Directors, the Directors being evaluated had not participated. As an outcome of the evaluation, it was noted that Board as a whole has a composition that is diverse in experience, skills, expertise, competence, gender balance, and fosters lively, free expression and constructive debates. The discussion quality is robust, well intended and leads to clear direction and decision.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013, the Directors to the best of their knowledge hereby state and confirm that:

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

(b) the Directors had selected such accounting policies and applied them consistently and made 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 profit and loss of the Company for that period;

(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

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

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

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

RELATED PARTY TRANSACTIONS

The Company follows robust internal processes before entering transactions with related parties and the considerations which govern the transactions with related parties are the same as those applicable for other vendors of the Company. All the transactions are undertaken for the benefit of the Company and in compliance with the applicable laws.

As a part of the Companys annual planning process, before the beginning of a financial year, details of all transactions proposed to be executed with related parties, including estimated amount of transactions to be executed, manner of determination of pricing and commercial terms, etc. are presented to the Audit Committee for its consideration and approval. The details of said transactions are also placed before the Board of Directors for their information. The Board members interested in a transaction do not participate in the discussion of the item wherein that item is being considered. Further approval is sought during the year for any new transaction/modification to the previously approve limits/terms of contracts with the related parties.

All contracts/arrangements/transactions entered into by the Company during the year under review with related parties were in the ordinary course of business and on arms length basis in terms of provisions of the Act.

The Company had no materially significant related party transaction, which is considered to have potential conflict with the interests of the Company at large. However, details of Related Party Transactions undertaken by the Company are disclosed in Form AOC-2 which is attached as an Annexure C to this Report.

The Board of Directors of the Company has on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act, 2013 and the Rules thereunder. This Policy was considered and approved by the Board and has been uploaded on the website of the Company at https://regencyhealthcare.in/wp-content/uploads/Related-Party-Transactions-Policy.pdf.

RISK MANAGEMENT

The Company recognises that risk is an integral and inevitable part of business and is fully committed to manage the risks in a proactive and efficient manner. The Company has a disciplined process for continuously assessing risks, in the internal and external environment along with minimising the impact of risks. The objective of Risk Management process in the Company is to enable value creation in an uncertain environment, promote good governance, address stakeholder expectations proactively and improve organisational resilience and sustainable growth.

The Company has in place a Risk Management Policy which articulates the approach to address the uncertainties in its endeavour to achieve its stated and implicit objectives. The Risk Management Committee of the Company has been entrusted by the Board with the responsibility of reviewing the risk management process in the Company and to ensure that key strategic and business risks are identified and addressed by the management.

The Company periodically reviews and improves the adequacy and effectiveness of its risk management systems considering rapidly changing business environment and evolving complexities. The Company, through the Risk Management process, aims to contain the risk within the risk appetite. There are no risks which in the opinion of the Board may threaten the existence of the Company.

LOANS/INVESTMENTS/GUARANTEES

Particulars of Loans/Investments/guarantees given and outstanding during the FY 2024-25 forms part of the Notes to the Financial Statements.

PUBLIC DEPOSITS

During the financial year under review, your Company had 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.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on March 31, 2025 is available on the Companys website at https://regencyhealthcare.in/investor.relations/.

SHARE CAPITAL

During the year under review, the Company has reclassified its authorised share capital from INR 2,05,00,00,000 (Indian Rupees Two Hundred Five Crores only) divided into 5,50,00,000 (Five Crore Fifty Lakh) equity shares of INR 10 (Indian Rupees Ten only) each and 15,00,00,000 (Fifteen Crore) preference shares of INR 10 (Indian Rupees Ten only) each to INR 2,05,00,00,000 (Indian Rupees Two Hundred Five Crores only) divided into 18,00,00,000 (Eighteen Crores only) equity shares of INR 10 (Indian Rupees Ten only) each and 2,50,00,000 (two crores and fifty lakhs only) preference shares at its Extra-ordinary General Meeting dated 4 July 2024.

CONVERSION OF CCPS INTO EQUITY SHARES

In the Annual General Meeting held on 27 October 2023, the Company approved the preferential allotment of 22,77,212 (Twenty-Two Lakh Seventy-Seven Thousand Two Hundred Twelve) Compulsorily Convertible Cumulative Preference Shares (“CCPS”) to Norwest Capital, LLC.

During the year under review, the Company converted the aforesaid 22,77,212 (Twenty-Two Lakh Seventy-Seven Thousand Two Hundred Twelve) CCPS into Equity Shares at a conversion price of INR 658.70 (Indian Rupees Six Hundred Fifty-Eight and Seventy Paise only) per Equity Share, which includes a securities premium of INR 648.70 (Indian Rupees Six Hundred Forty-Eight and Seventy Paise only) per Equity Share. The conversion was approved at the Board Meeting held on 4 June 2024.

BONUS ISSUE

The Board of Directors at its Meeting held on 4 June 2024 and approval of shareholders in its ExtraOrdinary General Meeting vide resolution dated 4 July 2024, your Company has on 19 August 2024 allotted 130,559,928 Equity Bonus Shares of face value of Rs. 10 each in the proportion of 8:1 i.e. 8 Equity Bonus Share of Rs.10 each for every 1 existing Equity Share of face value of Rs. 10 each held by the shareholders of the Company as on record date i.e. 12 July 2024. Post Bonus issue, the issued and paid-up equity share capital of the Company was increased from Rs. 163,199,910 to Rs. 1,468,799,190.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be provided to members on request.

AUDITORS

Statutory Auditors

Walker Chandiok & Co LLP, Chartered Accountants, (Firm registration no. 001076N/N500013) was appointed as Statutory Auditors of the Company in the 31^st Annual General Meeting held on 20 November, 2020 for the second term of five (5) years from the conclusion of the AGM till the conclusion of 36^th AGM to be held in the year 2025 as required under Section 139 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014. The Statutory Auditors have confirmed that they satisfy the independence criteria as required under the Act.

The Report given by Walker Chandiok & Co LLP, Chartered Accountants on the Financial Statements of the Company for the year 2025 is part of the Annual Report. The Notes on financial statement referred to in the Auditors Report are self-explanatory and do not call for any further comments. There has been no qualification, reservation, adverse remark or disclaimer given by the Auditors in their Report. During the year under review, the Auditors had not reported any matter under Section 143 (12) of the Act, therefore no detail is required to be disclosed under Section 134 (3) (ca) of the Act.

In view of the requirement of rotation of the Statutory Auditors in accordance with the requirements of section 139 of the Act and based on the recommendation of the Audit Committee, the Board has recommended the appointment of M/s. S. N. Dhawan & Co. LLP, Chartered Accountants (Firm Registration No.- 000050N / N 500045) as the Statutory Auditors of the Company for a term of 5 (five) consecutive financial years commencing from 1 April 2025 till 31 March 2030, from the conclusion of 36^th AGM till the conclusion of the 41^st AGM of the Company. S. N. Dhawan & Co. LLP, Chartered Accountants has submitted a certificate, as required under section 139(1) of the Act confirming that they meet the criteria provided in section 141 of the Act. Their appointment is subject to the approval of the Members of the Company at the ensuing AGM.

A resolution seeking their appointment forms part of the Notice convening the 36^th AGM and is recommended for consideration and approval of the Members of the Company.

Cost Auditors

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 your Company in respect of its hospital activity is required to be audited. Your directors had, on the recommendation of the Audit Committee and the Board of Directors, appointed Mr. Rishi Mohan Bansal, Cost Accountant, Kanpur (Membership No. 3323), as Cost Auditors of the Company to audit the cost accounts of your Company for the FY 2025-26 at a remuneration of Rs. 30,000/- (Rupees Thirty Thousand only) plus applicable taxes and reimbursement of out-of-pocket expenses incurred in connection with the cost audit. 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 Rishi Mohan Bansal, 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 your Company and accordingly such accounts and records are properly made and maintained.

The Report of the Cost Auditors for the FY 2024-25 does not contain any qualifications, reservations or adverse remarks and the comments given by the Cost Auditors are self- explanatory and hence do not call for any further explanations or comments.

Secretarial Auditors

The Secretarial Audit was carried out by M/s. SKS & Co., Company Secretaries for the financial year ended 31 March 2025. The report given by the Secretarial Auditors is annexed as Annexure D and forms an integral part of this Report. The Secretarial Audit Report was self-explanatory and does not call for any further comments. The Secretarial Audit Report does not contain any qualification, reservation, adverse remark or disclaimer.

In terms of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors appointed M/s. SKS & Co., Company Secretaries as the Secretarial Auditors of the Company in relation to the financial year ending 31 March 2025. The Company has received their written consent that the appointment is in accordance with the applicable provisions of the Act and rules framed thereunder. During the year under review, the Secretarial Auditors had not reported any matter under Section 143 (12) of the Act, therefore no detail is required to be disclosed under Section 134 (3) (ca) of the Act.

Internal Auditors

The Company has in place a robust Internal Audit function. In accordance with the provisions of Section 138 of Companies Act, 2013, read with Companies (Accounts) Rules, 2014, your Company had appointed BDO India LLP, as an Internal Auditors of the Company for Financial Year 2024-25 commencing from 1 April 2024 to 31 March 2025 in its Board Meeting dated 4 June 2024.

COMPLIANCE OF SECRETARIAL STANDARD

During the period under review, your Company has complied with the applicable provisions of Secretarial Standards issued by the Institute of Company Secretaries of India.

REGISTRAR AND SHARE TRANSFER AGENT

M/s Skyline Financial Services Private Limited shall continue to act as the Registrar and Share Transfer Agent of the Company.

VIGIL MECHANISM

The Company has a Vigil Mechanism that provides a formal channel for all its Directors, employees and business associates including customers to approach the Chairman of the Audit Committee and make protected disclosures about any unethical behaviour, actual or suspected fraud or violation of the Regencys Code of Conduct. No person is denied access to the Chairman of the Audit Committee. The Vigil Mechanism in the Company fosters a culture of trust and transparency among all its stakeholders.

The Company promotes ethical behaviour in all its business activities. The Company has a robust vigil mechanism through its Whistle Blower Policy which is in compliance with the provisions of Section 177(10) of the Companies Act, 2013.

The Whistle Blower Policy has been appropriately communicated within the Company and is available on the website of the Company at http://regencvhealthcare.in/wp-content/uploads/Whistle-Blower-Policv.pdf. The Whistle Blower Policy aims to:

a. allow and encourage stakeholders to bring to the managements notice concerns about unethical behaviour actual or suspected fraud or violation of the Companys code of conduct.

b. ensure timely and consistent organisational response.

c. build and strengthen a culture of transparency and trust.

d. provide protection against victimisation.

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

The Board has established robust policies and procedures to ensure the orderly and efficient conduct of its business. These include adherence to the Companys internal policies, safeguarding of assets, prevention and detection of fraud, error-reporting mechanisms, and maintaining accurate and complete accounting records.

The Company has designed and implemented a comprehensive system of Internal Financial Controls over financial reporting, aimed at ensuring that all transactions are properly authorised, accurately recorded, and reported in a timely manner. These controls provide reasonable assurance regarding the integrity and reliability of the Companys financial statements.

Furthermore, the Company actively monitors developments in Accounting Standards, the Companies Act, and other relevant regulations. It promptly updates its systems, processes, and financial controls to ensure continued compliance with all applicable requirements.

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, Technology Absorption, and Foreign Exchange Earnings and Outgo is given in Annexure E, forming part of the Boards Report.

POLICY FOR PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (“Prevention of Sexual Harassment Act”), the Company has formulated a Policy on Prevention of Sexual Harassment at Workplace for prevention, prohibition and redressal of sexual harassment at workplace and an Internal Complaints Committee (“ICC”) has also been set up to redress any such complaints received. The constitution of ICC is as per the provisions of POSH and includes external Members from NGO or those individuals having relevant experience.

The Company has zero tolerance towards sexual harassment at the workplace and is committed to providing a safe and conducive work environment to all its employees viz. permanent, contractual, temporary, trainees and associates and any person visiting the Company at its office.

All employees are committed to ensure that they work in an environment that not only promotes diversity and equality but also mutual trust, equal opportunity and respect for human rights. The Company periodically conducts sessions for employees across the organisation to build awareness about the Policy and the provisions of the Prevention of Sexual Harassment Act. During the financial year 2024-25, the Company received two complaints related to sexual harassment. Both were resolved during the year, and no cases remained pending beyond 90 days.

DISCLOSURE UNDER MATERNITY BENEFIT ACT, 1961

The Company has complied with all the provisions of Maternity Benefit Act, 1961 and rules thereof. LIQUIDITY

Our principal sources of liquidity are cash and cash equivalents and the cash flow that we generate from our operations. We continue to maintain sufficient cash to meet our strategic and operational requirements. Liquidity enables us to be agile and ready for meeting unforeseen strategic and business needs and opportunities.

MATERIAL CHANGES AFFECTING THE COMPANY

There were no material changes and commitments, affecting the financial position of the Company which have in F.Y. 2024-25.

CHANGE IN THE NATURE OF BUSINESS

During the financial year ended 31 March 2024, there was no change in the nature of business of the Company.

STATEMENT ON INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 124 of the Act, Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (“IEPF Rules”) read with the relevant circulars and amendments thereto, the amount of dividend remaining unpaid or unclaimed for a period of seven years from the due date is required to be transferred to the Investor Education and Protection Fund (“IEPF”), constituted by the Central Government. During the year under review, no amount was due for transfer to IEPF.

CREDIT RATING

The Companys sound financial management and its ability to service financial obligations in a timely manner, has been affirmed by the credit rating agency CRISIL with long-term instrument rated as A-/Stable and short-term instrument rated as A2+.

DETAILS OF SIGNIFICANT AND MATERIAL ORDER

There are no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and the Companys operations in future.

APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE AND DISCLOSURE ON ONE-TIME SETTLEMENT

As on the date of the Report no application is pending under the Insolvency and Bankruptcy Code, 2016 and the Company did not file any application under (‘IBC) during the FY 2024-25. Further, the Company has not made any one-time settlement

APPRECIATIONS

The Board of Directors wishes to express its sincere gratitude to the medical fraternity and patients for their unwavering support, trust, and patronage towards the Company.

The Directors are pleased to report that the Company has delivered a strong financial performance during the year. This achievement is a testament to the relentless dedication and hard work of our employees, whose commitment has been instrumental in driving the Companys growth and success.

The Board also extends its heartfelt thanks to the banks, financial institutions, and investors for their valuable support, cooperation, and encouragement throughout the year.

Finally, the Directors would like to convey their deep appreciation to the shareholders for their continued confidence and steadfast belief in the Company.