Speciality Medicines Ltd Directors Report

To,

The Members.

Your Directors have pleasure in presenting the 2^ml Annual Report of the Company together with the Audited Financial Statement of Accounts for the financial year ended March 31, 2023.

FINANCIAL HIGHLIGHTS (Rupees in Thousand)

Particulars	Standalone		Consolidated
	F.Y. 2022-23	F.Y. 2021-22	F.Y. 2021-22
Revenue from Operations	2,32,407.71	4,04,440.28	4,04,321.35
Add: Other Income	239.63	14.62	14.62
Total Income	2,32,647.34	4,04,454.90	4,04,335.97
Less: Purchase & Other Direct Expenses	2,03,943.64	355,213.96	3,51,622.35
Less: Changes in Inventories	-41,129.04	-1,825.24	-5,004.90
Less: Employee Benefit Expeases	12,651.69	13,500.69	15,946.57
Less: Finance Charges	3,542.49	309.03	798.04
Less: Depreciation	2,949.99	1,117.59	1,117.59
Less: Other Expenses	21,086.97	17,627.86	18,165.59
Total Expense	2,03,045.74	3,82,943.89	3,82,645.24
Net Profit/(Loss) Before l ax	29,601.59	21,511.01	21,690.72
Less: Tax expenses	7,592.92	6,019.03	6,072.95
Net Profif/(Loss) After Tax	22,008.67	15,491.98	15,617.78

FINANCIAL PERFORMANCE

The Company has earned revenue from operation of Rs. 2,32,407.71 Thousand during the financial year 2022-23. It has incurred total expenses of Ks. 2,03,045.75 Thousand for the financial year 2022-23, making net profit Ks. 22,008.67 Thousand for the financial year 2022-23.

Financial Year 2022-23 being the Second Year of the Company after Incorporation, the Board expects a growth in the Revenue from operations and ultimately an increase in the Net Profit over the upcoming years.

CHANGE IN NATURE OF BUSINESS

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

DIVIDEND

Being the Second year since Incorporation, the Board of Directors regret to recommend any dividend.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act, 2013 do not apply as there is no unpaid dividend accounts appeared in balance sheet as at March 31, 2023.

TRANSFER TO RESERVES

Tire Board of Directors of the Company have decided to carry the entire amount of Net Profit to the Balance Sheet.

SUBSIDIARIES/IOINT VENTURE/ASSOCIATE COMPANY

During the year under review, the company sold/ transferred or otherwise dispose-off in one or more tranches, the entire investments i.e. 10000 shares held in Spemed Techno Private Limited (Formerly Known As Nilkanth Medicines Private Limited), a wholly owned subsidiary Company in India to the purchasers.

The company doesnt have any Subsidiaries, Joint Venture and Associate Company as on the closure of financial year.

MEETINGS OF THE BOARD OF DIRECTORS

During the Financial Year 2022-23, the Company held Thirteen (13) meetings of the Board of Directors as per Section 173 of Companies Act, 2013 which is summarized below. The provisions of Companies Act, 2013 were adhered to while considering the time gap between two meetings.

Sr. No.	Date of Meeting	Board Strength	No. of Directors Present
1.	24-04-2022	2	2
2.	29-04-2022	2	2
3.	02-05-2022	2	2
4.	06-05-2022	2	2
5.	07-06-2022	2	2
6.	06-07-2022	2	2
7.	08-07-2022	2	2
8.	30-07-2022	2	2
9.	10-08-2022	2	2
10.	21-08-2022	2	2
11.	30-09-2022	2	2
12.	01-12-2022	2	2
13.	01-02-2023	2	2

DIRECTORS & KEY MANAGERIAL PERSONNEL

During the year 2022-2.3, there is a no change in Directors and Key Managerial Personnel of the Company. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors of the Company confirms 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; and

e) Company being unlisted sub clause (e) of section 134 (3) is not applicable.

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.

SHARE CAPITAL

During the year under review, following changes were carried out in the authorized and paid-up share capital of the Company:

Authorized Capital

During the year under review, vide Special Resolution passed by the Members at their Extra Ordinary General Meeting held on June 15, 2022, the authorized share capital of the Company has been increased from Rupees 25,00,000 divided into 2,50,000 Equity Shares of Rupees 10.00 each to Rupees 5,00,00,000 divided into 50,00,000 Equity Shares of Rupees 10.00 each.

The Authorized share Capital of the Company, as at closure of financial year 2022-23, was Rupees 5,00,00,000 divided into 50,00,000 Equity Shares of Rupees 10.00 each.

Issued, Subscribed & Paid-up Capital

During the year under review,

• Vide Board Resolution dated July 06, 2022; the Company has allotted total 29401X10 fully paid up Bonus Equity Shares of Rupees 10.00 each as fully paid- up against existing 210000 equity shares of Rupees 10.00 each to the existing shareholders of the Company whose names appear in the register of Members of the Company as on record date i.e. July 6, 2022 in the ratio of 14:1 (14 bonus equity shares of Rupees 10.00 each fully paid up for every 1 exiting equity share of Rupees 10.00 each fully paid-up).

• Vide Board Resolution dated August 10, 2022; the Board of Directors of the Company allotted total 670100 Equity Shares of Rupees 10.00 each by way of Cash and conversion of whole / part of the outstanding amount of unsecured Loan obtained by the Company from Applicant Shareholders of the Company / Renouncee as per the terms and conditions approved by the Board of Directors at their meeting held on July 8, 2022 and by Members at their Extra-ordinary General Meeting held on July 30, 2022 aggregating to Rupees 67,01,000/- (Rupees Sixty Seven l^akh One Thousand only).

Issued, Subscribed & Paid-up share Capital of the Company, after above Issues, as at closure of financial year 2022-23, was Rupees 3,82,01,000 divided into 38,20,100 Equity Shares of Rupees 10.00 each.

During the year under review, vide Special Resolutions passed by the Members at their respective Extra Ordinary General Meeting held on April 29, 2022 and May 10, 2022, the Company has further allotted total 30000 and 2200 Compulsory Convertible Debentures to identified Investors, on Preferential Basis, at an Issue Price of INR 500.00 per Compulsory Convertible Debenture.

However, from the date of end of financial year under review till the date of this report, vide Special Resolutions passed by the Members at their respective Extra Ordinary General Meeting held on August 02,2023 and August 28, 2023, the Company has further allotted total 79,366 and 79,366 Equity shares to identified

Investor, on Preferential Basis, at an Issue Price of 1NR 63.00 per Equity Shares as on August 7, 2023 and August 28, 2023 respectively.

LOANS. GUARANTEES AND INVESTMENTS

The details of Loans, Guarantee, Investment and Securities are provided in the notes to the financial statement of the Company.

RELATED PARTY TRANSACTIONS

All Related Party Transactions entered into during the financial year were on an arms length basis and were in the ordinary course of business. Your Company had not entered into any transactions with the related parties which could be considered material in terms of Section 188 of the Companies Act, 2013. Accordingly, the disclosure of related party transactions as required under Section 134(3)(h) of the Companies Act, 2013 in form AOC-2 is not applicable.

There were no contracts, arrangements or transactions which were not executed in ordinary course of business and/or at arms length basis.

ANNUAL RETURN

The company doesnt have any website; hence it is not required to disclose web-link of its website. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO

A. Conservation of energy;

i) Steps taken / impact on conservation of energy:

Your Company is firmly committed to reduce the consumption of power by introducing more energy efficient technology. The operations of the Company are not energy intensive. However the Company endeavored to conserve energy coasumption wherever feasible.

ii) Steps taken by the company for utilizing alternate sources of energy including waste generated: Nil

iii) Capital investment on energy conservation equipment: NIL

B. Technology absorption:

i) The efforts made towards technology absorption;

No special efforts made towards technology absorption.

ii) The benefits derived like product improvement, cost reduction, product development or import substitution;

Not Applicable

iii) In case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-

There is no import of technology since incorporation of Company. Hence information as required to be provided under rule 9.8 (3) (B) (iii) of Companies (Accounts) Rules, 2014, are nil.

C. Foreign exchange earnings and Outgo (Amount in Rupees)

The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows, is as under:

Foreign Exchange earned: Rs. 1,65,560.43 Thousands

Foreign Exchange outgo: Nil

DEPOSITS

The company has not accepted any deposits during the year. Information relating to deposits, covered under Chapter V of the Act is NIL There are no deposits which are not in compliance with the requirements of Chapter V of the Companies Act, 2013.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an internal management framework which is commensurate with the size and scale of the Company.

RISK MANAGEMENT

A well-defined risk management mechanism covering the risk mapping and trend analysis, risk exposure, potential impact and risk mitigation process is in place. A detailed exercise is being carried out to identify, evaluate, monitor and manage both business and non-business risks.

COST RECORD

The maintenance of cost records is not specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013 accordingly, such records are not made and maintained by the Company.

SECRETARIAL AUDITOR AND TH1EIR REPORT

The Company is not falling within the ambit of Section 204 of the Companies Act, 2013 and accordingly, it does not require to obtain the report of Secretarial Auditor.

AUDITORS AND REPORT

Pursuant to the provisions of Section 139, 142 and all other applicable provisions of the Companies Act, 2013 read with rules made thereunder, M/s. Rahul Mistri And Co., Chartered Accountants, Gandhinagar (FRN: 147586W), have been appointed as Statutory Auditors of the Company to hold office as such till the conclusion of 6^th Annual General Meeting of the Company to be held in the calendar year 2027.

The Auditors Report on the accounts of the Company for the financial year ended on March 31, 2023 is self- explanatory and do not call for further explanations or comments that may be treated as adequate compliance of Section 134 of the Companies Act, 2013.

SEXUAL HARASSMENT OF WOMEN AT WORKPLACE

To foster a positive workplace environment, free from harassment of any nature, we have institutionalized the Anti-Sexual Harassment Initiative (ASHI) framework, through which we address complaints of sexual harassment at the all workplaces of the Company. Our policy assures discretion and guarantees non-retaliation to complainants. We follow a gender-neutral approach in handling complaints of sexual harassment and we are compliant with the law of tire land where we operate. During the year under review, there were no incidences of sexual harassment reported.

MATERIAL CHANGES AND COMMITMENTS

There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

COMPLIANCE WITH THE PROVISIONS Ot SECRETARIAL STANDARD 1 AND SECRETARIAL STANDARD 2

The applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to Meetings of the Board of Directors and General Meetings, respectively, have been duly complied by your Company.

GENERAL DISCLOSURES

Your Directors state that the Company has made disclosures in this report for the items prescribed in section 134(3) of the Act and Rule 8 of The Companies (Accounts) Rules, 2014 to the extent of transactions took place on those items during the year or applicability of the various provision of the Companies Act, 2013.

ACKNOWLEDGEMENT

The Board places on record their appreciation of the support of all stakeholders.