Themis Medicare Ltd Directors Report.

The Members,

Themis Medicare Limited

Your Directors take pleasure in presenting the 49th Annual Report along with the Audited Financial

Statements for the financial year ended 31st March, 2019. The Company operates only in one business segment viz., "Pharmaceuticals" and this report covers its Pharmaceutical business performance.

1. FINANCIAL STATEMENTS & RESULTS:

A. Financial results:

The Companys performance during the year ended 31st March, 2019 as compared to the previous financial year, is summarized below:

(Rs. in lakhs)

Particular 2018-19 2017-18
Income 18,680.04 21,474.20
Less: Expenses 20,133.38 20,534.53
Profit/(Loss) before tax (1,453.34) 939.67
Deferred tax (183.74) 10.18
Profit after Tax (1,269.60) 929.49
APPROPRIATION
Final Dividend - -
Tax on distribution of dividend - -
Transfer to General Reserve - -
Balance carried to Balance sheet (1,269.60) 929.49

B. Operations:

The Company continues to be engaged in the activities pertaining to manufacturing of pharmaceutical products, especially Formulation and API activity There was no change in nature of the business of the Company, during the year under review.

C. REPORT ON PERFORMANCE OF SUBSIDIARIES, ASSOCIATES AND JOINT VENTURE COMPANIES:

As on the last day of the financial year, the Company had two non material subsidiaries namely, Artemis Biotech Limited and Themis Lifestyle Private Limited and one Joint Venture Company in UK namely, Carpo Medical Limited. The performance and financial position 149(7) of ofeach of the subsidiaries, associates and joint venture companies for the year ended 31st March 2019 in Form AOC-1 is attached and marked as Annexure I and forms part of this Report.

D. Dividend:

In view of the loss incurred by the Company, your Directors have not recommended dividend for the financial year under review

E. Transfer to reserves:

In view of the loss incurred during the year, your Board has not recommended transfer of any amount during the year under review. The Company has not transferred any amount to reserves and not withdrawn any amount from the reserves.

F. Revision of financial statement:

There was no revision of the financial statements for the year under review.

G. Deposits:

Except for unclaimed deposits of Rs. 1.65 lakhs, the Company does not have outstanding deposits from public. The Company has repaid outstanding deposits from Directors and Promoter Members for which the Honble Company Law Board, Regional Bench, Mumbai, had allowed repayment on or before 31.03.2018 on the original terms & conditions of deposits. Your Company has not accepted any deposits falling within the purview of provisions of Section 73 of the Companies Act 2013 ("the Act") read with the Companies (Acceptance of Deposit) Rules, 2014 during the year under review.

Hence, the requirement for furnishing of details of deposits which are not in compliance with Chapter V of the Act is not applicable.

H. DISCLOSURES UNDER SECTION 134(3)(L) OF THE COMPANIES ACT, 2013:

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Companys financial position have occurred between the end of the financial year of the Company and date of this report.

I. Statement on declaration under section 149(6) of the companies act , 2013:

The Independent Directors of the Company have given the declaration Company as required under Section the Companies Act, 2013 and Regulation25(8) of the SEBI (Listing Obligations

Requirements) that they meet the criteria of independence and that they are not aware of any circumstance or situation, which exists or may be reasonably anticipated, that could impair or impact ability to discharge their duties with an objective independent judgement and without any external

J. STATEMENT UNDER SECTION 178:

Your Company has constituted Nomination RemunerationCommittee as well as Stakeholders Relationship Committee as provided under section 178(1) of the Companies Act, 2013. The Nomination and RemunerationCommittee considers that the and positive attributesof the Directors on the Board of the Company are sufficientenough to discharge their duties as such. In view of inadequacy of profits, remuneration is being paid to Managing and Whole time Directors in line with Schedule V of the Companies Act, 2013 as also only sitting fees are paid to other Directors for attending Board and Audit and Risk Management Committee meetings at Policy on Nomination and Appointment of Directors/Criteria for appointment of Senior Management and Remuneration Policy as formulated under Section 178(3) of the Companies Act, 2013 is annexed as Annexure II and forms part of this Report.

K. Comments of the board on auditors report:

i. Observations of Statutory Auditors on

Accounts for the year ended 31st March,

2019: There are no qualifications, or adverse remarks or disclaimer made by the Statutory Auditors in respect of financial statements as on and for the year ended 31st March, 2019. ii. Secretarial Audit Report for the year ended 31st March, 2019: Provisions of Section read with Section 134(3) of the Companies Act, 2013, mandates to obtain Secretarial Audit Report from a PracticingCompany Secretary. M/s. Shirish Shetye and Associates, Practicing Company Secretaries were appointed to conduct Secretarial Audit and issue Report for the financial year 2018-19. Secretarial Audit Report issued by M/s. Shirish Shetye & Associates, PracticingCompany 2015 confirming Secretaries in Form MR-3 for the financial year 2018-19 forms part of this report. The Secretarial Audit Report is annexed herewith as Annexure - III.

In respect of the observations made in the Secretarial Audit report, following are the explanations and comments offered by the . Board.

The Company was required to spend Rs.24.56 lakhs as CSR contribution for the financial year 2018-19, which was not spent. • Every year the Company tries to identify the deserving set of people of Companys CSR whocantake benefit activities. During Company tried to identify such group of people. However, it took more than considerable time people for CSR activity. Therefore, the Company could not spend on the CSR activitiesduring However, the Company is committed to spend during the current financial year . the amount which may be required to be spent for CSR activities during the current year.

The Company has not made payment of minimum wages to Plant Workman category employees, at Hyderabad Unit, as required to be paid in Telangana State. • The Company normally engages some workers in the plant through a contractor. The workmen are the reservations employees of the contractor and as per the agreement between the

Company and the contractor(s) it is his basic responsibility to ensure the wages are paid. Minimum Wages Act The Company has already instructed to ensure that differential wages are paid to those workmen to comply with the provisions of the Minimum Wages Act.

L. PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES:

Details of Loans granted, Guarantees given or Investments made during the year under review, covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

M. PARTICULAROFCONTRACTSORARRANGEMENT WITH RELATED PARTIES:

Contracts/arrangements/transactions entered by the Company during the financial year with related parties in the ordinary course of business. All related party transactions are placed for the approval before the Audit and Risk Management Committee and also before the Board and Shareholders wherever necessary in compliance with the provisions of the Act and

Listing Regulations. The Audit Committee had granted omnibus approval for Related Party Transactions as per the provisions contained in the SEBI (Listing Obligations Requirements) year, the Company has not entered into any contracts / arrangements / transactions related parties which could be considered material in accordance with policy of the Company on material related party or under section 188(1) of the Act. Accordingly, there are no particulars to report in Form AOC-2.

The policy on materiality of related party transactions and dealing with related party transactions as approved by the Board been adopted by the Company and uploaded on the Companys website at the link: http:// www.themismedicare.com/wp-content/ uploads/2015/08/Related-Party-Policy.pdf

N. DISCLOSURE OF INTERNAL FINANCIAL CONTROLS:

The Internal Financial Controls with reference to financial statements as designed implemented by your Company are adequate.

During the year under review, no material or serious observations were received from Internal Auditors of the Company for or inadequacy of such controls.

The Internal Financial Controls followed by the Company are adequate and commensurate with the size and nature of the business and were operating review.

Internal Audit function of the Company is carried out through Independent Chartered Accountants Firms to test and verify the Companys Internal Control System. The Companys assets are adequately safeguarded against significant misuse or loss. The Company has in place, adequate Internal Financial Controls with respect to maintenance of accounting records and financial transactions. Proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were were on an arms length adequate and operating effectively.

O. DISCLOSURE OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL:

There are no orders passed by the regulators or courts or Tribunals for/or against the Company during the year under review.

P. DISCLOSURE UNDER SECTION 43(A)(II) OF THE COMPANIES ACT, 2013:

The Companyand Disclosure has not issued any shares with differential rights and hence no information 2015. During the per provisions of Section with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

Q. DISCLOSURE UNDER SECTION 54(1)(D) OF THE COMPANIES ACT, 2013:

The Company has not issued any sweat equity shares during the year under review and hence no information as per 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

R. DISCLOSURE UNDER SECTION 62(1)(B) OF THE COMPANIES ACT, 2013:

As per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 and other applicable Regulations, details of equity shares issued, if any, under Employees Stock Option Scheme during the financial year under review is furnished in Annexure IV attached herewith which forms part of this Report.

S. Disclosure under section 67(3) of the companies act, 2013:

The provisions of Section 67(3) as well as disclosure under rule 16(4) of Companies (Share Capital and Debentures) Rules 2014 are not applicable in respect of Equity shares during the against ESOPs granted to employees.

2. Matters related TO directors AND Key managerial personnel

During the year under review, following changes took place in the Board Composition Managerial Personnel:

Dr. Gabor Gulacsi, ceased to be a Director of the Company on account of vacation of his office as Director of the Company pursuant to Section 167(1) (b) of the Companies Act, 2013 with effect from 26 th March, 2019. Mrs. Reena S. Patel, an Alternate Director to Mr. Lajos Kovacs resigned as an Alternate Director to Mr. Lajos Kovacs with effect from 26th March, 2019 in accordance with the provisions of second proviso to section 167 of Dr. Gabor Gulacsi was appointed as an Additional Director by the Board with effect from 29th March, 2019, as a representative of Gedeon Richter Plc, Hungary, Joint Venture Partners of the Company. Dr. Gabor Gulacsi holds officeupto the ensuing General Meeting of the Company and is eligible for appointment as Director in compliance provisions of the Companies Act, 2013. A brief profile of Dr. Gabor Gulacsi is given in the Notice convening the Annual General Meeting. The Board recommends members the appointment of Dr. Gabor Gulacsi as a Director in the ensuing Annual General Meeting the Company.

Mrs. Reena Patel was appointed as an Alternate Director to Dr. Gabor Gulacsi to attend Board meetings of the Company during his absence from India with effect from 29 th March, 2019. In accordance with the provisions of the Act and the Articles of Association Kovacs (DIN 01297326), Non Executive Director of the Company, retires by rotation at the ensuing Annual General Meeting and being himself for re-appointment. The Board recommends to the members the appointment of Mr. Lajos Kovacs as a Director in the ensuing Annual General Meeting (AGM) of the Company. ly ; Necessary resolutions appointment of the aforesaid Directors are included in the Notice convening the ensuing AGM and details of the proposal for re-appointment are mentioned in the Explanatory Statement to theNotice.

3. Disclosures related TO BOARD, committees AND policies a. BOARD meetings:

A calendar of regular meetings was prepared and circulated in advance to the Directors. Pursuant to the provisions of the Companies Act, 2013 and rules made thereunder, the Board met five (5) times during the year, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between the meetings was within the period prescribed under the Companies Act, 2013 and SEBI (Listing Obligations Requirements) Regulations, 2015.

B. DIRECTORS RESPONSIBILITY STATEMENT:

In terms of Section 134(5) of the Companies Act, 2013, in relation to the audited financial statements of the Company for the year ended Companies Act, 2013.

31st March, 2019, the Board of Directors hereby confirms that: i. in the preparation of the annual accounts, the applicable accountingstandards had been followed and there is no material departure according to the accounting standards; ii. such accountingpolicies have been selected and applied consistently and the Directors to the 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 of Company as at 31st March, 2019 and of the profit of the Company for that year; iii. proper and sufficient maintenance of adequate accountingrecords in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and of the Company, Mr. Lajos other irregularities; iv. the annual accounts of the Company have eligibleoffers been prepared on a going concern basis; v. internal financial controls have been laid down to be followed by the Company and that such internal financial controls are adequate andwereoperating forvi. Properthe appointment/re- systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

C. COMMITTEES OF THE BOARD OF DIRECTORS

In compliance with the requirement of applicable laws and as part of best governance practices, the Company has following Committees of the Board as on 31st March, 2019: i. Audit and Risk Management Committee ii. Stakeholders Relationship Committee iii. Nomination and Remuneration Committee iv. Corporate Social Responsibility Committee The details with respect to the aforesaid Committees forms part of the Corporate Governance Report.

D. VIGIL MECHANISM POLICY/ WHISTLE BLOWER POLICYF OR THE DIRECTORS AND EMPLOYEES:

The Board of Directors of the Company has, pursuant to the provisions of Section 177(9) of the Companies Act, 2013 read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, framed "Vigil Mechanism Policy" for Directors and employees of the Company to inter alia provide a mechanism which ensures adequate safeguards to employees and Directors from any victimization on raising of concerns of any violationsof legal or regulatory requirements, incorrect or misrepresentation of any financial statements and reports, etc.

As per SEBI (Prohibition of Insider Trading) (Amendment) Regulation, 20l8 which amends SEBI (Prohibition of Insider Trading) Regulation, 20l5, a listed company shall have a whistle—blower policy and make employees aware of such policy to enable employees to report instances of leak of unpublished price sensitive information. Considering the above amendment in SEBI (PIT) Regulations, 2015, the Vigil Mechanism Policy of the Company was amended with effect from 1st April, 2019 to enable employees to report instances of leak of unpublished price sensitive information.

The employees of the Company have the right/ option to report their concern/grievance to the Chairman of the Audit and Risk Management Committee.

The said Policy is available on the website of the Company at http://www.themismedicare.com/ wp-content/uploads/2016/12/Vigil-Mechanism- Whistle-Blower-Policy.pdf

The Company is committed to adhere to the highest standards of ethical, moral and legal conduct of business operations.

E. Risk management:

We have an integrated approach to managing risks inherent in various aspect of our business. The Audit and Risk Management Committee and the Board discuss various aspects involved in Business risks to the Company and the manner to mitigate the same.

F. Corporate social responsibility policy:

As per the provisions of Section 135 of the

Act read with Companies (Corporate Social

Responsibility Policy) Rules, 2014, the Board of Directors has constituted a Corporate Social Responsibility (CSR) Committee.

The composition of the Company is as under: i. Mr. Humayun Dhanrajgir, Chairman of the Committee, ii. Mr. H. Subramaniam, Member and iii. Dr. Sachin D. Patel, Member

The Company has formulated policy for CSR activitiesand is placed on Company at http://www.themismedicare.com/ wp-content/uploads/2016/12/CSR-Policy.pdf Annual report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 has been appended as Annexure - V and forms an integral part of this Report.

In terms of Section 135 of the 2013 read with Companies (Corporate Social Responsibility) Rules, 2014 as amended ("CSR Rules") and in accordance with the CSR Policy, during the financial year 2018-19, the Company could not spend two percent of the average net profits of the Company during the three immediately preceding financial years.

G. Annual evaluation of directors, committee and board:

The Board of Directors at its meeting held on 8th Feb, 2019 has carried out an annual evaluation of its own performance, Board Committees and Individual Directors pursuant to the provisions of the Act and the corporate governance requirements as prescribed by Securities and Exchange Board of India (Listing Obligations Disclosure Requirements), Regulations ("SEBI Listing Regulations").

The performance of the Board was evaluated by the Board with the help of inputs received from all the Directors on the basis of the criteria such as the Board Composition effectiveness of Board processes, information and functioning, etc.

The performance of the Committees was evaluated by the Board with the help of inputs received from the Committee members on the basis of the criteria such as the composition of Committees, effectiveness of Committee meetings, etc. The Board concluded that all Board Committees were discharging its functions effectively.

The Board and the Nomination and Remuneration Committee 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 ability to contribute and monitor our corporate governance practices, meaningful and constructive in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role.

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, taking into account the views of Executive Directors and Non-Executive Directors. The same was discussed in the Board meeting that followed the meeting of the Independent

Directors, at which the performance of the

Board, its committees and individual directors was also discussed. Performance evaluationof Independent Directors was done by the entire Board, excluding the Independent Director being evaluated. The Board was overall of the opinion that the Independent Directors have contributed through the process of Board and Committee meetingof which they are members in effective manner as per as their expertise in their field and needs of the organization. The suggestions and contributions of the Independent Directors in the working of the Board\Committee were satisfactory and the value addition made by such Independent Directors individually and as a team is commendable.

Also the Company had provided facility of performance evaluation to Directors through online platform for convenience of the Board members.

H. Disclosure under section 197(12) of the companies act, 2013 and other disclosures as per rule 5 of companies (appointment & remuneration) rules, 2014:

The ratio of the remunerationof each Director to the median remuneration of the employees of the Company for the financial year under review has been mentioned in the Annexure to this Report marked as Annexure VI.

I. Payment of remuneration / commission to directors from holding or subsidiary companies:

None of the managerial personnel i.e.

Managing Director and Whole time Directors in the issues discussed of the Company is in receipt of remuneration/ commission from the Holding or Subsidiary Company of the Company.

4. Auditors reports:

a. Appointment Of auditors:

M/s. R. P. Sardar & Co., Chartered Accountants (FRN - 109273W), the Statutory Auditors of the Company, were appointed by the members at the 47th Annual General Meeting (AGM) to hold such office till conclusion of the 52 nd AGM subject to ratification of their appointment by the members at every intervening AGM held after 47th AGM. The Ministry of Corporate Affairs (MCA), vide its commencement Notification dated 7th May, 2018, has notified and amended the relevant provision of the Companies Act, 2013 relating the requirement of placing the matter relating to ratification of appointment of Statutory Auditors by members at every Annual General Meeting. The said amendment has done away with the requirement of of appointment of the Statutory Auditors. Therefore, M/s. R. P. Sardar & Co., Chartered Accountants (FRN - 109273W), will continue to hold office till conclusion of the 52 nd AGM and their appointment will not be subject to ratification by the members at every intervening AGM held after 47th AGM.

B. MAINTENANCE OF COST RECORDS :

Maintenance of cost records is required as specified by the Central Government under subsection (1) of section 148 of the Companies Act, 2013, and accordingly such accounts and records are made and maintained.

C. COST AUDITORS:

Pursuant to the provisions of Section 148 of Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors on recommendation of the Audit and Risk Management Committee, appointed B J. D. Nanabhoy & Co., Cost Accountants as the Cost Auditors of the Company for the financial year 2019-20 for the applicable Product. Pursuant to Section 148 of the Act read with the Companies (Audit and Auditors) Rules, 2014, appropriate resolutions to the remuneration of the said Cost Auditors are appearing in the Notice convening the 49th AGM of the Company.

D. SECRETARIAL AUDITORS:

The Board of Directors of the Company appointed M/s. Shirish Shetye & Associates, Practising Company Secretaries, Mumbai, to conduct Secretarial Audit for the financial year 2019-20.

The Secretarial Audit Report of M/s.ShirishShetye & Associates, Practising Company Secretaries for the financial year 2018-19, is annexed herewith as Annexure III. During the year under review, the Company has complied with the applicable provisions of the Secretarial Standards.

5. Other disclosures

Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under: a.

Extract Of annual return:

Pursuant to the provisions of Section 134(3) (a) and Section 92(3) of the Companies Act, 2013 read with Rule 12 of the Companies (Management and Administration)Rules, 2014, the Annual Return of the Company as at March 31, 2019 is uploaded on the website of the Company and can be accessed at https://www themismedicare.com.

B. Conservation of energy, technology absorption and foreign exchange earnings and outgo:

The particulars of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts)

Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in Annexure VII which forms part of this Report.

C. Corporate governance:

eCertificat Reporton Corporate Governanceand of Practising Company Secretary regarding compliance of the Conditions of Corporate . Governance as stipulated in regulation 17 to 27 and clauses (b) to (i) of sub-regulation (2) of regulation46 of SEBI (Listing Obligations Disclosure Requirements) Regulations, 2015 with the Stock Exchanges, are enclosed as a separate section and forms part of this report.

D. Prevention of sexual harassment:

seekingyourratification We have zero tolerance for sexual harassment at the workplace and have adopted a Policy on prevention, prohibition harassment at the workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition Redressal) Act, 2013 and the Rules thereunder for preventionand redressal of Complaints of Sexual Harassment at the workplace. During the financial year ended 31st March, 2019, your Company has not received any complaint relating to sexual harassment.

6. Management discussion & analysis:

(a) Industry structure and developments:

During the year 2018-19, the Indian economy regained momentum after a slowdown due to demonetisation and the implementation of GST (Goods and Services Tax). Sustained GDP growth is likely to continue though there is a decline in growth projections. It is expected that Budget focus over rural and unorganised sector will stimulate the demand and boost rural growth. Indias cost of productionis significantly lower than that of the US and almost half of that of

Europe. It gives a competitive edge to India over others. . Increase in the size of middle class households coupled with the improvement in medical infrastructure and increase in the penetration of health insurance in the country will also influence in the growth of pharmaceuticals sector. The Industry consistingof Indian and foreign required under the provisions players is witnessing increased spends on R&D initiatives focusing on expanding traditional generic portfolios.

(b) Opportunities and Threats:

Pharma business being associated with basic human needs, introduction of newer and cost effective medicines in different therapeutic groups enjoys maximum densely populated country like India.

Due to increasing population, income levels and awareness, demand for drugs is expected to rise. Growing demand could open up the market for production of drugs in India.

The government has allocated Rs 31,745 crore (US$ 4.64 billion) towards the National Health Mission under which rural and urban people will get on healthcare is expected to benefit the pharmaceutical sector as well.

Indias generic drug producers hold a strong position in the global supply chain and play an integral role in developing the pharmaceutical industry.

With 70 per cent of Indias populationresiding in rural areas, pharma companies have immense opportunities to tap this market. Demand for generic medicines in rural markets has seen a sharp growth. Various companies are investing in the distribution network in rural areas. Availability of sub-standard products in the market, fierce competition intervention in the pricing policies continue to be major threats to the business stability for a relativelysmall size company like ours. However, the management is taking all necessary steps and continuously adopting strategies not only to survive in the market but to perform impressively under the current scenario. Your Companys strong foothold on R&D has contributed for introduction of many new products over the years. The present thrust is mainly in of marketing of differentiated injectables in India and abroad.

The regulations drugs, or making prescriptions of medicines by their generic name instead of brand names mandatory, too, remain key threats for the industry.

Indian pharma companies will face from big pharma companies, backed by huge financial muscle. Generic drugs offer a cost effective alternative will result significant savings to customers.

(c) Segment–wise or product-wise performance:

The Company operates in a single segment i.e. pharmaceuticals. However, the Company has given more thrust for the last many years on Formulations SKUs as compared to API. The in a results of the Company under review also depict that Formulation business faster rate than APIs.

(d)Outlook: India continues to be one of the fastest growing economies in the world and this is expected to continue in the financial year 2019-20. The demand trends in the markets is stable and the government initiatives such as increases in Minimum Support. The increased expenditure Price (MSP) for Agricultural Produce, provision of health insurance like Ayushman Bharat Yojana, Pradhan Mantri Bhartiya Jan Aushadhi Pariyojana Kendra, direct money transfer etc. will lend further impetus to the rural economy. Inclusive GDP growth will augur well for the overall economy.

Commodity inflation, potential disruptions to global events and a likelihood of below normal monsoon this year are possible headwinds which the business will need to navigate with caution. Your Companys strategy to lead premiumisation, market development, build channels of the future whilst keeping the sustainable living plan at its core, will enable it to create long-term value for all aswellasGovernment stakeholders.

Your Company will continue to focus on being Purpose-led and Future fit.

(e) Risks and concerns: Like all businesses, the business of your Company is also exposed to few risks.

In the past few years, the Government of India has made frequent changes in the drug pricing and other laws impacting the operations of the Company. Further, adverse changes in government policies with respect to essential medicines and pricing with respect to the products may reduce margins of the Company. concerning price control of Besides, actions taken by the competition can result in adverse orders being passed by Governmental and regulatory authorities to severe disruption in your Companys business, unwanted litigation thereby severely impacting the Company and its business partners.

Risks, liabilities and losses are part and parcel of any industry and need to be tackled through well to drug innovators which forecasted strategies and actions. To mitigate and avoid risks in the current scenario, the Company is focusing on shifting API to Formulation business and also improving its market access for the existing products. We have a robust risk management system, wherein we proactively identify potential risks and accordingly devise our short-term and long-term strategies to mitigate any risk which could materially impact your Companys long-term goals.

Besides, the risks in Domestic market there are various risks in the International markets as well, an important one being regulatory risk, Plant inspections, vendor approvals, etc.

(f) Internal control systems and their adequacy: The Company has proper and adequate system of internal audit and controls which ensure that all the assets are safeguarded against loss from unauthorised use or disposition and that all transactions are authorised, recorded and reported correctly. The Company continuously strives to improve upon/evolve and implement best practices for each of its major areas with a view to strengthen its internal control systems. The Company has assigned internal audit function to leading firms of Chartered Accountants at its different locations Regular internal audit and checks are carried out to ensure that the responsibilities are discharged effectively. All major findings suggestions arising out of internal audit are reported and reviewed by the Audit and Risk Management Committee. The Management ensures implementation of these suggestions and reviews them periodically.

Other statutory requirements especially, in respect of pharmaceutical business are vigorously followed in order to have better internal controls over the affairs of the Company.

(g) Discussion on financial performance respect to operational performance:

The operational performance during the year under review was not on expected lines. There was a major disruption in the Companys business due to a restrictive order passed by Governmental/ Regulatory authroties in respect of one the important products resulting in a major litigation and quarantining the stocks of the product pending outcome of the litigation.AS on date matter is still sub judice. Shift of Formulation operational performance results.

(h) Material developments in Human Resources / Industrial Relations front, including number of people employed: In the current age of dynamic, challenging and changing business environment, your Company believes that its ‘People i.e. ‘Human Capital is its important and vital asset. Your Company continues to harness and improve competencies and skills of its Human Capital through training and development programs.

The core of the Human Resource philosophy at Themis is empowering human resources towards achievement of Company aspirations. The overall industrial industrial relations atmosphere continued to be cordial. Your Company has a diverse mix of youth and experience which nurtures the business. As on March 31, 2019 the total employee strength was 1113. Our objective to build organizational capability through skill development across levels ensures that we invest in training and enhancing people skills in line with the dynamic business needs. In our endeavour to be employee centric, your Company revamped existing HR policies to be more people friendly and offered them a better work life balance. We continued to rely on technology to reach out to employees and improve efficiencies by . automatingpolicies and work flows. During the current year, HR would focus on enabling change to deliver the desired business outcomes. and The objective is to create an HR focusing on responding to business challenges of tomorrow.

7. Acknowledgements AND appreciation:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, collaborators, employees, financial institutions and Central and State Governments for their consistent support and encouragement to the Company.

for and on behalf of the Board of Directors
Sd/- Sd/-
Dr. Sachin D. Patel H. Dhanrajgir
Managing Director & CEO Independent Director
DIN: 00033353 DIN: 00004006
Place: Mumbai
Dated: 28th May, 2019