Themis Medicare Ltd Management Discussions

Cautionary Statement:

The statements in the "Management Discussion and Analysis Report" describe your Companys objectives, projections, estimates and expectations which be "forward-looking statements" within the meaning of the applicable laws and regulations. The actual results could differ materially from those expressed or implied, depending upon the economic conditions, government policies, taxation and other laws and other incidental factors.

The financial financial year ended 31^st March, 2025, is as follows: Total revenue from operations stood at Rs. 405.51 Crores for the year ended 31^st March, 2025, as against Rs. 381.76 Crores for the corresponding previous period, an increase of 6.22 %.

The total cost of raw materials rendered for the financial year ended 31^st March, 2025 was Rs. 131.99 Crores as against Rs. 136.71 Crores for the corresponding previous period. The EBIDTA (earnings before interest,depreciation space, with and tax, excluding other income) was Rs. 49.05 Crores for the year ended 31^st March, 2025 as against Rs. 51.51 Crores for the corresponding previous period, a decrease of 4.78%.

The PAT (profit after tax) was Rs. 29.83 Croresedge. Stable and the year ended 31^st March, 2025, as against Rs. 43.52 Crores for the corresponding previous period, a drop of 31.46%. methodologies and Pan-India distribution

Themis Medicare Limited operates primarily in one segment i.e. pharmaceuticals. The Company presently engaged in the business of manufacturing of finished formulations and synthetic Active Pharmaceutical Ingredients. The financial results the Company depict healthy growth in business during measures and the period under consideration broadly driven by all . key product categories.

However, profitability is adversely impacted during the year.

In line with industry dynamics, the Company is exposed to certain risks profile. The Company undertakes the requisite risk assessment and has risk mitigation plans in place.

Drug pricing and other policies and laws are subject to changes by the Government. Any potentially adverse changes in government policies with respect to essential medicines, pricing or hospital regulations with respect to the products may impact the revenue and/or margins of the Company.

To manage its credit exposure, TML has a credit policy in place with credit limit requests and approval norms. The Company follows a process for payments from clients as per schedule. TML performanceoftheCompanyforthe is in the process of developing a focused and aggressive receivables management system to ensure timely collections.

TML continues to judiciously manage its debt-equity ratio, maintaining debt at comfortable levels. The Company strives to utilize internal accruals optimally and manages working capital well to maintain the overall interest cost at reasonable levels.

The Company operates in a competitive the presence of domestic as well as international peers. TML has key differentiators in terms of R&D, execution, quality and delivery which make it resilient to competition. The Company invests in R&D and its talent pool to maintain a competitive long-standing client relationships further help insulate the Company from this risk. TML also mitigates this risk with its infrastructure, product portfolio, specialized formulation network.

Our profitability and cost effectiveness are potential impacted by changes in the prices of raw materials, power and other input/utility costs. This is offset by cost saving stringent initiatives

1. Growing Demand for High-End Pharmaceuticals

With rising income levels and a large population, there is an increasing demand for high-end, specialized drugs in India. This trend presents opportunities for local manufacturers to expand their production of such pharmaceutical products.

2. Tapping into Indias Rural Market Potential

Approximately 70% of Indias population resides in rural areas, creating untapped potential for pharmaceutical companies. The surge in medicine demand in these regions is prompting significant investments in rural distribution networks, offering growth opportunities.

Availability of Skilled Workforce and Growing

Indias strong pool of skilled labour and technical attractive investment expertise makes it an destination. Additionally, the growth rural market investments and infrastructure development further supports the industrys expansion.

Patent Expiry and Market Opportunities Over the next decade, several drugs are expected to go off-patent, presenting an opportunity for generic drug manufacturers to capture a significant share of global revenues.

Governments Free Generic Medicine Initiative The Indian governments plan to provide free generic medicines to half the population which will boost access to essential drugs and support the growth of generics manufacturing.

Expansion of Over-the-Counter (OTC) Drug

Market

A proposed draft notification aims to several common drugs in the OTC category, including paracetamol and other widely used medications, which is expected to drive growth in the OTC drug market.

Rise in Lifestyle Diseases

The increasing prevalence of lifestyle diseases such as the Drug diabetesandhypertensionisexpected Controller General of to drive the demand for pharmaceuticals in these therapeutic categories.

Growing Awareness and Acceptance of

Therapeutic Products

As awareness of healthcare products increases, more consumers are likely to embrace pharmaceutical therapies, thereby fuelling demand in the sector.

Surge in Self-Medication and OTC Drug Usage

As patients become more inclined to self-medicate, especially for common ailments, the Over-The-Counter (OTC) drug market is expected to experience significant growth

Rising Acceptance of Biologics and Preventive

Medicines

Biologic drugs and preventive medicines are becoming increasingly accepted in the Indian healthcare market, contributing to higher demand for innovative therapies.

Growth of Medical Tourism

Indias expanding medical tourism sector, fuelled by high-quality healthcare at competitive costs, is attracting international patients and further driving demand for pharmaceuticals.

Increased Penetration in lower tier markets

Pharmaceutical companies are expanding their presence in tier-2 and tier-3 cities, where there is growing demand for medicines and healthcare services.

Healthcare Infrastructure Growth

With more than 1,60,000 hospital beds expected to be added each year over the next decade, the increasing healthcare infrastructure will stimulate higher demand for pharmaceuticals to support patient care.

Expansion of ‘Jan Aushadhi Kendras

The governments growing network of ‘Jan Aushadhi Kendras is enhancing access to affordable generic medicines, especially in underserved rural areas, driving the demand for generics and contributing to a more equitable healthcare system.

1. Regulatory and Compliance Challenges

Companies in this industry are subject to complex and evolving regulatory landscape. Domestically, compliance with stringent guidelines set by authorities India (DCGI) demands substantial resources and meticulous attention to detail. Internationally, aligning with the regulatory standards of agencies like the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) is crucial for market access.

The pharmaceutical industry is experiencing stiff competition, both domestically and globally. The rise of generic drug manufacturers, particularly from countries like China and Brazil, has intensified price competition, challenging market share profitability. Additionally, the rapidand Policy Support of new competitors has been players into new therapeutic a more competitive continuous innovation and strategic agility.

The heavy relianceonspecificcountriesfor Active manufacturing and export Pharmaceutical Ingredients (APIs) exposes supply chain to significant as geopolitical tensions, trade restrictions global crises can severely impact the availability of essential raw materials, leading to production delays and increased costs.

4. Demand Uncertainties

Pharma industry need to accurately forecast potential fluctuations in demand which could due to factors like changing disease prevalence, healthcare policy shifts and economic fluctuations These uncertainties can lead to mismatches in supply areas like oncology, biologics, and and demand, affecting inventory management and financial performance.

The Company ensuresthe orderlyandefficientconduct and tariffs particularly from the of its business including adherence to Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records and the timely preparation as required under the Companies Act, 2013. This involves the timely and accurate communication of financial and operational both internalandexternal.TheCompanyidentifies and assesses the risks it faces and develops necessary strategiestomitigate global healthcare, offering or managethoserisks. affordable, The Statutory Auditors and internal auditors while conductingthe audit, review and evaluate the internal controls and their observations are discussed with the Audit Committee of the Board.

Indias pharmaceutical industry is a critical pillar the global pharmaceutical and biotech space, driving innovation, healthcare worldwide. It encompasses a vast array of sectors including generic drug development, Over-The-Counter (OTC) medicines, bulk drug manufacturing, vaccines, contract research, bio-similar and biologics.

and Key Growth Drivers

Government Initiatives Indias transforming "Make India" the countrys pharmaceutical sector, strengthening Indias position as a global pharma hub. The government is actively working to enhance the industrys competitiveness, with new policies aimed at promoting innovation, growth. (Source: BizzBuzz).

Market Expansion With a rapidly growing healthcare sector and evolving patient needs, Indias pharmaceutical market has become one of the largest and most diverse in the world. The chronic care market, driven by diseases like diabetes and hypertension continues to perform robustly and the sectors growth is expected to continue at an impressive pace with chronic drugs contributing growth in FY25. (Source: Business Standard).

1. . Investment in R&D and Manufacturing India is increasingly investing in R&D to drive innovationin new therapeutic biosimilars.

2. Challenges and Trade Uncertainty While Indias pharma industry continues to show promise, global trade uncertainties United States could have an adverse impact.

The Indian pharmaceutical industrys trajectory is one of tremendous potential. With consistent growth in exports, domestic market expansion and increasing investment in R&D and infrastructure, India is well-positioned to solidify its role as a global leader in pharmaceuticals. As the "Pharmacy of the World," India is set to continue influencing high-quality medicines, vaccines and therapeutics to a growing global population which bodes well for Companies in this space.

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https://timesofindia.indiatimes.com/business/india-business/ donald-trump-tariff-relief-for-now-indias-pharma-sector-navigates-an-uncertain-us-trade-future/articleshow/120545409. cms https://www.bizzbuzz.news/industry/pharma/how-make-in-india-transforming-indias-global-pharma-footprint-1360075 https://www.bain.com/insights/healing-the-world-a-roadmap-for-making-india-a-global-pharma-exports-hub/ https://www.thehindu.com/business/Industry/indian-pharma-industry-projected-to-reach-130-billion-by-2030-say-experts/ article68922245.ece https://www.business-standard.com/industry/news/robust-chronic-performance-drives-8-4-growth-for-indian-pharma-mkt-in-fy25-125040801060_1.html

API refers to the biologically active component of a drug responsible for producing its intended medical effects. This segment is a key driver of the pharmaceutical industry, accounting approximately 35% of the overall market. APIs are integral to the manufacturing of both generic and branded drugs.

India is one of the largest producers of APIs globally, contributing country manufactures over 500 different APIs, with India contributing57% of APIs to the World

Health Organization (WHO)s prequalified ensures that India is a reliable source for critical medicines worldwide.

In FY25, Indias API sector is expected to witness 7-8% growth, driven by rising demand for generics and the expanding need for critical medicines in global markets. This growth is also supported by a and scale well-established supply chain, low manufacturing This trend of outsourcing has made India a costs and a robust regulatory environment.

India is also a leading exporter of pharmaceutical formulations with a 14% market share by volume and ranking approximately 12^th in export value globally. This market share is significant, considering Indias cost-competitiveness and high standards in drugmanufacturing. of factors including increased

The formulations sector is expected to witness double-digit growth over the next five years. This growth will be propelled by rising demand for generic drugs in developed markets where cost-effective alternatives are increasingly preferred Indias strong position in formulations is fuelled by its ability to produce high-quality medicines at competitive prices. healthcare

Indias pharmaceutical industry is navigatinga complex global landscape with regulatory changes and price control mechanisms playing a pivotal role.

The APIs and formulations markets are well-positioned to grow in the coming years. Increased investments, strategic acquisitions, and global market expansion are key drivers of this sector. As companies continue to enhance their capabilities and diversify their product offerings, Indias role as a global hub for such products will become even more prominent.

Source:https://manufacturing.economictimes.indiatimes. news/life-sciences/indias-active-pharmaceutical-ingredients-industry-to-grow-7-8-per-cent-in-fy25/112482207 https://www.businesstoday.in/industry/pharma/story/pharma-companies-eyeing-acquisitions-in-api-and-formulation-space-to-consolidate-market-share-crisil-446660-2024-09-19 https://www.business-standard.com/industry/news/nppa-retail-prices-of-53-drug-formulations-including-painkillers- to8%oftheGlobalAPIIndustry.The https://www.financialexpress.com/business/healthcare-pharma-exporters-eye-preferential-treatment-by-us-3770930/

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The CMO market which supports pharmaceutical production was valued at USD 172.8 billion in 2023 and is projected to grow at a 7.7% CAGR until 2032. Outsourcing to CMOs allows pharmaceutical firms to cut costs, enhance production flexibility operations. key hubforcontractmanufacturing,attracting global pharmaceutical companies seeking cost-efficient production solutions.

The Indian hospital industry is poised for robust growth with a projected CAGR of approximately 12% over the next three fiscal years. This growth is being driven by a combination healthcare awareness, a rise in lifestyle diseases, a growing elderly population and expanded health insurance coverage. Additionally, the rising disposable income, augmented public expenditure on healthcare and the growth of medical tourism are contributing to the industrys expansion. India is emerging as a key attracting patients from player medicaltourism, across the globe due to its competitive costs and high-quality services.

The sector is also witnessing increased deal-making activity with major investments by private equity and foreign players in Indian healthcare providers.

TML has a diversified product portfolio which is a strength that the Company aims to leverage. The Company has a strong presence in Formulations and Injectables and a wide geographical network of presence in the hospital business across the country. We believe there are numerous opportunities in sector especially given our strong product pipeline. TML is among the leading players in the country to offer a comprehensive range of anesthesia products which is advantageous for the hospital business. We also have divisions in critical care and intensive care which are key parts of our long-term growth plan. Moreover, the Company is also investing in trade and co-marketing business, seeing them as areas with substantial potential for growth. This positions TML well in the market which is showing tremendous growth opportunities. Among nations that produce pharmaceuticals, India has long held the top spot Medicine spending in India is projected to grow 9-12% over the next five years, leading India to become one of the top 10 countries in terms of medicine spending. Going forward, better growth in domestic sales would also depend on the ability of companies to align their product portfolio towards therapies such as cardiovascular, anti-diabetes, anti-depressants and anti-cancers for chronic diseases, which are on the rise.

The Indian Government has taken many steps to reduce costs and bring down healthcare expenses. The National Health Protection Scheme (which aims to offer universal healthcare), the ageing population, the rise in chronic diseases and other government programmes including the opening of pharmacies that offer together expected to serve as a boost to the pharmaceutical industry which bodes well for Companies like TML.

TML achieved healthy financial and operational performance during this financial year. The Companys revenue increased 6.22% YoY to Rs. 405.51 crores. However, the Net Profit after compared to previous year, to Rs. 29.83 crores.

. The core of the Human Resource philosophy at Themis Medicare Ltd. is empowering human resources towards achievement of Company aspirations. Your Company has a diverse mix of youth and experience which nurtures the business. As on 31^st March, 2025 the total employee strength was 1760.