venus remedies share price Management discussions

A review of the economy

Global economy: After a contraction of more than 3% in the GDP in 2020, the world economy rebounded handsomely to an estimated growth of about 6.1% in 2021. The recovery was driven by household spending and uptake in investment as the Covid-19 outbreak had brought economic activities to a standstill in 2020 owing to lockdown measures worldwide.

The start to 2022 was quite unprecedented. The emergence of the Omicron variant shook the economic progress, but the adversity on people and economies across the globe remained short lived. This was followed by a devastating invasion of Ukraine by Russia. The adversities arising out of this humanitarian crises are expected to ripple across the world for quite some time.

Going forward, the IMF estimates the GDP to grow by 3.6% in 2022. This marked drop would be owing to the unwinding of the fiscal stimulus, and geopolitical issues prevailing across the world which is creating unprecedented inflationary pressure on economic growth.

Covid cost to the world

The IMF described Coronavirus as the worst crisis since the Great Depression, and said the pandemic would leave deep and enduring scars caused by job losses, weaker investment and children being deprived of education. According to the institution, the estimated hit to the global economy from Covid-19 in 2020 would total US$28tn in lost output. Further, it expects that the COVID-19 pandemic will cost the global economy US$12.5 trillion through 2024.

Indian economy: FY22 is a story of economic resurgence during which Indians from ail walks of life, in one voice, determined to overcome this health scare. Hence, despite an anxious start to FY22 owing to the Delta variant and the third wave towards the close of the year, India reported a solid performance - registering an 8.7% GDP growth in FY22 (against a 6.6% contraction in GDP in FY21). It was powered by relentless vaccination drives, substantial fiscal stimulus and timely policy support by the government.

The growth was contributed by all sectors of the Indian economy. Industry grew by 11.8%, Agriculture grew by 3.9% and services scaled by 8.2%. Indias total tax revenue in FY22 scaled by 34% to Rs27.07 lakh crore in FY22. In addition, 19 out of 22 High-Frequency Indicators crossed their pre-pandemic figures - showcasing a wholistic rebound.

Even as the nation was readying itself to sustain the economic momentum into FY23, geopolitical headwinds have cast a shadow on Indias growth prospects in the current year. After taking cognizance of these and other challenges such as the prevailing global supply- chain disruption, inflationary pressures and surging fuel prices, several global and Indian reputed institutions have put out estimates of a 7-7.5% growth in Indias GDP for FY23.

The pharmaceutical sector Global pharma The global pharma market has witnessed tremendous activity over the last two years owing to the pandemic and its aftermath - be it in finding emergency use solutions, development of vaccines and medicine consumption.

Despite the debilitating impact of the pandemic on lives and livelihoods, and the huge toll on the medical fraternity and frontline warriors, the pharmaceutical world across the globe remain charged to develop and deliver solutions that could help save lives.

With the intensity of the pandemic having moderated and its impact being uneven across nations, the global pharmaceutical space is seeing some sense of normalcy - but with a keen focus to develop a solution that will finally neutralise the Covid-19 virus.

What lies ahead: The global medicine market —is expected to grow at 3-6% CAGR through 2026, reaching about US$1.8 trillion in total market size.

The largest driver of medicine spending through the next five years is expected to be COVID-19 vaccinations. The total cumulative spending on COVID-19 vaccines through 2026 is projected to be US$251 billion.

In developed markets, the use of medicines has remained consistent over the past decade, with majority of medicine use continuing to be in older and traditional therapies. Newer specialty therapies in oncology are driving growth of 13.8% CAGR in onco-supportive drugs and 4.6% CAGR in oncology in recent years.

Medicine use in pharmerging markets has grown in all major therapy areas over the past decade. Older therapies in cardiovascular disease and dermatologics account for 20% of current medicine use, with the share of usage in dermatologics growing 34% over the last 10 years.

The U.S. market, on a net price basis, is forecast to grow 0-3% CAGR over the next five years, down from 3.5% CAGR for the past five years. Spending in Europe is expected to increase by US$51 billion through 2026, with a focus on generics and biosimilars.

Changes in the historical and projected global medicine spending model due to COVID-19, 2019-2026 (US$ Bn) ..

Indian pharmi Labelled as the Medicine Box of the World, and rightly so, Indias pharmaceutical industry is witnessing remarkable growth.

It is valued US$42 Billion (202021), with a growth rate of 10-12% against a mere 3% growth last year - a large part of this growth can be attributed to the medication to combat the pandemic.

The Government is making considerable effort in supporting the Indian pharmaceutical sector. It announced a production-linked incentive (PLI

1.0) scheme on 21 July 2020 aimed at boosting Indias bulk drug security. This covered identified Active Pharmaceutical Ingredients /Key Starting Materials /Drug Intermediates. The financial outlay for the said PLI scheme was H6,940 crore.

With the aim to encourage the pharmaceutical industry to enhance its manufacturing capabilities, diversify the product mix to complex generics, going up the value chain, bringing investment and creating global champions out of India, the government notified a new scheme on March 3, 2021 (PLI 2.0) and its operational guidelines have since been announced on 1 June 2021. The new scheme is more extensive in its coverage as compared to PLI 1.0 and is expected to offer a total of C15,000 crore in incentives to selected applicants for identified pharma products.

According to the Indian Economic Survey 2021, the Indian pharmaceutical market is expected to grow 3 times in the next 10 years. The sector is expected to touch US$65 billion by 2024 and further expand to reach US$120-130 billion by 2030.

Evolving trend! The pharma industry has seen a rapid rise in the past three years with fastpaced digitisation. Moreover, advanced research in the field has created newer avenues of treatment for mankind. The technological trends expected tc play out are:

Rise of E-pharmacies: During the pandemic, e-pharmacies delivered medicines to 3.5 million households across the country. With the rise in popularity, it is expected that the growth of e-pharmacies will continue strongly, and the overall number of households served is set to cross the 70 million mark by 2025.

Clinical trials: Digitisation is expected to change the future of clinical trials in the years to come. From matching trials to patients by analysing their health records to improving medication adherence, trials will become more global and remotely led.

Artificial Intelligence: AIl can present a myriad of opportunities for the pharmaceutical industry bringing about a radical shift in the innovation paradigm of the pharma sector. Pharmaceutical companies around the world are leveraging advanced ML algorithms and AI-powered tools to streamline the drug discovery process, create more affordable drugs and therapies, and, most importantly, reduce operational costs. Pharma companies can also implement AI in the manufacturing process for higher productivity, improved efficiency, and faster production of life-saving drugs.

New technologies: In the near future, new technologies like digital pills will increase the accuracy of monitoring and reporting. Trackable drugs, containing ingestible sensors and cameras will enable medical researchers and healthcare providers to monitor patient progress remotely.

Government support: Although India is a global leader in drug manufacturing and exporting, the nation relies heavily on import of drugs for internal use. To make India self-reliant, the Government has taken a number of steps.

In January 2021, the Indian government decided to set up 3 bulk drug parks at a total expense of C14,300 crore to make chemical compounds or APIs to reduce imports. In September 2021, the Indian government contributed US$4 billion to the pharmaceutical and medical industries.

• The Union Cabinet amended the FDI (Foreign Direct Investment) policy to facilitate 100% FDI through automatic route in greenfield or new pharma projects.

For the brownfield project 74% FDI has been allowed through automatic route, the rest needs government approval.

Budgetary support:

Union Budget 2021-22	Union Budget 2022-23
The Ministry of Health and Family Welfare was allocated B73,932 crore	• B86,200 crore has been allocated to the Ministry of Health & Family Welfare.
The Department of Health Research B2,663 crore.	• The government is going to promote thematic funds for the sunrise sector like Digital Economy
B37,130 was allocated to the National Health Mission.	Pharma where the governments share would be 20%.
PM Aatmanirbhar Swasth Bharat Yojana (PMSSY) was given B64,180 crore for 6 years.	• Tax breaks and incentives for private healthcare facilities in Tier-III, Tier-IV cities and villages have been announced.
The Ministry of Ayush was allocated B2,970 crore for research, educate and propagate alternative medicines like Ayurveda.	• National Digital Health Ecosystem was announced, which is an open forum consisting of registries of health providers & facilities, universal access to health facilities and unique health identities.
	• The 35% yearly increase in budgetary support to capital expenditure could encourage the building of new hospitals and other medical facilities.
	• PMSSY was allocated B10,000 crore, 43% higher than last year to boost medical education and set up AIIMS infrastructure.

Research & Development

Research and development builds a platform for the future growth of any pharmaceutical company. The same holds for Venus. Its R&D team plays an instrumental role in taking the Company forward.

Venus Medicine Research Centre (VMRC), the R&D wing of Venus Remedies is a fully equipped interdisciplinary drug discovery and development center located in Baddi, Himachal Pradesh.

Approved by the Department of Scientific and Industrial Research (DSIR), the research experts of VMRC remain dedicated to developing solutions that address antimicrobial resistance, target delivery anticancer drugs and solutions for unmet medical needs in pain management.

Adopting New Technology

Venus Medicine Research Centre has a singular aim of addressing unmet medical needs. Over the years, the Company has added super specialty labs to advance its efforts in drug development. For the first time in India, the Company added the Organ-on- a-chip lab.

In FY22, the Company installed the kidney-in-a-chip model that promises to radically change the methodology for screening drug toxicity. It will enable the team to gain a deep understanding of mechanisms leading to kidney damage in humans and consequently enhance its ability to find better solutions for the patients and caregivers.

Shortly, using this technology, the team plans to create more relevant in vivo systems by making a tandem connection to other human organs using flow dynamics.

Installation of Human Organ- on-a-chip lab: This technology employs multi-channel 3D-microfluidic cell culture chips to simulate activities, mechanics, and physiological responses of organs and organ systems, acting as a type of artificial organ. This miniature model of a human organ has the size of a memory stick and has the potential to revolutionise medical research and drug discovery by allowing researchers to see biological mechanism behaviour in ways never possible before. This technology will also boost the development of new medicines. Its ability to emulate human organs allows for more realistic and accurate tests of drug candidates at the pre-clinical stage.

Key Collaborations

VMRC is a learning unit, always seeking avenues to gather knowledge that can help in making research more incisive and better their capability in developing relevant products for mankind and Venus. Along those lines, the team established collaborations with pioneers in their respective fields to thrive and prosper while mutually benefitting one another. Some key collaborations have been inked in FY22. The notable collaborations have been with Newcells Biotech, UK and CDRI- CSIR, India for Experiments, NortisBio, US for Technology installation and Training, Pharma- stats, India for Training and Consulting, Cliantha, India for Clinical experiments.

Scientific Communications

Five posters of the teams in- house research studies were presented on international platforms including the World Microbe Forum 2021 (An American Society of Microbiology conference), European Congress of Clinical Microbiology & Infectious Diseases 2021, Infection 2021 (A British Society for Antimicrobial Chemotherapy conference).

Product pipeline

A lot of potential products are in the pipeline that can change the course of the Company as well as the sector. In the antibiotics segment, VRT-001 in STN platform technology is in the F&D stage. VRP-034 in Renal Guard technology is optimistically in the clinical trial phase. Other products are also in the pipeline based on

the Renal Guard technology. Several homeostatic and natural products are also in key development phases. VRP-034 is in the clinical study phase, VRP-035 & VRP-044 are in the pre-clinical development phase are on Companys prime focus.

Product Launch R3SET dealing with pain management has hogged the focus of the industry as the launch has created a new growth avenue for the Company in the marketplace. The product has received heartening response in the domestic market. The team expects to maximise returns for the years of hard work in R3SET.

Plant

Operations

Venus Remedies has three manufacturing facilities at Panchkula and Baddi in India and Werne in Germany. All three facilities are certified by ISO 9001, ISO 14001 and OHSAS 18001, European GMP and 14 other international regulatory authorities, which make our products globally acceptable.

The Company ranks among the leading injectable manufacturers in the world which cater to high growth therapeutic segments. FY22 was a seminal year on the shop floor as the Company worked relentlessly to deliver the volumes committed by its marketing team. The Companys utilisation methodology improved significantly. Slow- moving and dead PPM, excess finished inventories and shipper stocks were consumed in unregistered orders. This helped the Company in converting inventory in the books to cash in the bank. The Company started shipper harmonisation project to optimise best pallet space in order to save freight cost.

The operations team led by Dr. (Mrs.) Manu Chaudhary, Joint Managing Director of the Company, achieved some remarkable milestones during the year under review.

Key Shopfloor Achievements

• Timely quality product delivery to Indian and International customers irrespective of quantity.

Transferred 50 Lakh approx, units of Enoxaparin, which is the highest number produced to date by Venus.

Achieved the highest meropenem API consumption in FY22 (17 tons used for the production of meropenem products).

Executed 1,500 orders in FY22 with an average lead time of 25 days.

The Companys paradigm shift to focus on production and productivity has yielded great dividends. It has streamlined workflow and contributed greatly to upscaling while maintaining the cost-effectiveness of processes.

Improving Productivity

Increased the lengths of the Packing conveyor in all facilities to enhance productivity by 20% and reduce manpower requirement.

Installed New Lyophilizer in H -facility to enhance the capacity of the facility to manufacture Lyophilised products; capacity increased by 1600% against previous lyophilizer capacity

Automation done by installing a New External ampoule washing machine. It saved 6 man power.

Installed a high-capacity Automatic Robotic PFS and Cartridge filling & stoppering machine - this investment increased the capacity by 80 % and helped in achieving very high Enoxaparin demand.

• Fully automatic pressure controlled new sealing machine is installed in the Sterloc plant for improving quality & productivity.

• Installed new big Cold rooms to cater to the needs for new pipeline products in general facility and to be ready for future demand.

Small Steps Big Difference

The Company focused on fast- moving products to increase the overall production without incurring major capex. It increased the batch size of some products (namely Etoposide and

Paclitaxel) and the campaign cycle for other key products (namely Imipenem Cilastatin and Meropenem). These efforts helped in increasing productivity. All efforts were backed by duly validated processes with help of QA and CQA team, and optimised operational costs. As a result, production volumes of key products jumped substantially.

The companys focus on increasing productivity yielded results right when needed. The volume rose exponentially. Ceftriaxone production volume almost tripled in FY22 . Paclitaxel yield rose around 50%, Irinotecan production volume was up more than threefold while Enoxaparin also saw a substantial increase in volume.

Cost-Effective Measures

The Company focused on optimising operating costs. It worked on reducing its energy consumption at all operating blocks - it retrofitted all AHUs and replaced Dx units with Chiller-based units which made a significant difference in reducing energy consumption. The Company focused on improving overall operating efficiencies which optimised its utility consumption significantly.

New in Production Line

Keeping up with the Covid demands, the Company started production of Antibiotic Doxycycline in FY22.

FY23-Action Plan

The Company has drawn a blueprint for the current year which promises to improve productivity while optimising the overall cost of production.

• Replace less value or low-cost products with new, high-value products.

Automate the Spine system and reduce manual procedures.

Harmonise packaging sizes for lesser inventory.

Upgrade infrastructure.

Focus on strengthening the functional and technical skills of the operations team.

Install a new Brine Chiller at the Oncology facility to cater sub-zero product manufacturing.

• Invest in a new Jacketed Manufacturing Tank and filling a tank at the oncology facility to cater to new pipeline products.

Invest in new technological solutions in facilities for some control methods.

Undertake multiple energy saving projects across all facilities.

Business development

Venus caters to a global marketplace with footprints in over 80 countries including India. In its business journey of decades, the Company has successfully established and consolidated itself as an esteemed brand with its niche products like injectables for mission-critical segments like antimicrobial resistance and anticancer. For home and abroad, the Company has adopted and maintained a dual approach and execution. In the domestic circuit, the field force primarily focuses on institutional business — with hospitals, government agencies and other institutions. In the international arena, the Company entered into strategic partnerships with some of the global marquee players for sale of products in the identified markets..

International marketing

Strategic collaborations with leading pharma marketing companies have enabled the Company to establish a strong presence in over 80 nations globally. The Company has 11 marketing offices outside India to cater to its overseas business requirements. Exports account for more than 70% of the Companys Total Revenue.

Growth Drivers Entered new markets:

Expanding its global footprints, the Company in FY22 entered new markets primarily in Africa, Europe and CIS regions. The countries include Paraguay, Latvia, Congo, Macedonia, UAE, Cuba, Rwanda, Kuwait, Zambia, Portugal, Ireland to name a few. The Company managed to successfully enter the new markets with a bouquet of products. This enhanced the image of the Company as a global brand and positioned the products at a high ground.

Focused actions: The

International Business team primarily focuses on therapeutic segments such as Antibiotics, Anti-coagulant and Oncology. The Company has bolstered its business through a lot of engaging activities in these fields like promoting products from these segments, signing business deals and securing registrations.

High-standard service:

Customer satisfaction level reached a new high in FY22 as the Company was able to read the pulse of international markets ahead of others and utilised it to win customers and retain them with the vast experience across continents and experienced IB personnel. Digitalisation streamlined the process for enhancing service and satisfaction.

Key Business Achievements Sales Growth: The Companys commitment and robust endeavours yielded results as sales grew from niche markets- [ from existing and new products.

The International Business Team conducts CMEs or Launch programmes in the respective countries for launching new products. The team also gather relevant data of the particular market to bid for tenders.

Products launched: FY22 was a ripe year that contributed largely to the recipe for success. The Company successfully launched new products in existing as well as new markets, which resulted in the achievement of its sales target.

Enhancing Brand Value: Holistic buckets of key registration in key markets proved to be crucial in the Companys growth in FY22. At the other end, comparative prices while maintaining high standards of quality benchmarks gave Venus a hallmark of credibility.

The Way Forward Grow Business: Given the favourable wind for the pharma sector across the globe, the Company believes that its time to thrive. The Company has set its eyes on growing international business sales in FY23.

Focus on Oncology products:

The Company has strategised to promote Oncology products in all existing as well as new markets that the Company wishes to penetrate.

Commercialise Dormant MAs: The Company, is setting its course for the future, has planned to commercialise all its dormant MAs lying in the Companys existing markets.

Focus of institutional business:

The Companys primary focus will be growth by thriving in the institutional business domain. Extensive market potential analyses have been planned to achieve the target in FY23.

Domestic Marketing

Adoption of superior domestic marketing methodologies and processes with equally excelling execution propelled the Company towards a comprehensive and consolidated growth in this financial year. The numbers were heartening and at the same time aspire the team to climb new heights in the pharma sphere.

Growth Drivers

Revenue growth: The Company achieved revenue growth in domestic market as compared to the last year. Quality of our products and timely execution of orders during the pandemic did the trick for us. Venpocare dealing with Wound Healing was also launched during the year with much hype and delight.

New Products: Oncology and Wound care products were launched in the Institutional Division. Moreover, we have Repositioned our Brands in two Specialty & Therapeutic Segment. First One in IPD (Indoor Patient Dept) with Antibiotic Critical Care Range. Second in Neurosurgery Specialty with Osmotic Diuretics & Steroid Therapy.

Key Business Achievements Expanding our Domain:

Institutional Business Operations expanded to 4 States- Orissa, J&K, Punjab, Telangana. New hospitals and institutional partnerships in government sector included Indian Railways, Odisha State Medical Corporation Ltd-Bhubaneswar, Sher-i-Kashmir Institute of Medical Science-Srinagar, Municipal Corporation of Delhi- Delhi.

Bolstering partnerships: In

the Private and Public sectors we expanded our partnerships with MAX Hospital - Mohali, Alchemist Hospital - Panchkula, Kothari Hospital - Bikaner, Shrimann Multispecialty Hospital

- Jalandhar, Kidney Hospital

- Jalandhar, PIMS Hospital- Jalandhar, Oxford Hospital

- Jalandhar, Adesh Hospital

- Ambala, GBH American Hospital -Udaipur, PDMMC Hospital- Amravati, RIMS Hospital

- Amravati, NEO Hospital - Noida, Yashodha Multispecialty Hospital-Latur, Venktesh Hospital

- Nagpur, KRIMS Hospital -Nagpur, Bharati Hospital & Medical College - Sangli, CNS Hospital -Solapur, KLE Hospital- Belgaum, Apex Hospital-Bhopal. We received new orders from Indian Railways, Odisha State Medical Corporation Ltd, Sher- i-Kashmir Institute of Medical Sciences-Srinagar and Municipal Corporation of Delhi.

Going Forward

Maximising reach: Registration of our Research product in the Government and extending coverage to maximum Government Hospitals are what we look to achieve in FY23.

We also have set the target of aggressive promotion in Orthopaedic segment for our research products.

Brand strategy: Venus being one of largest manufacturer of Injectables, have RePositioned its Product Range in two specialty segments.

First, Specialty Segment is IPD (Indoor Patient Dept) Segment in which we are targeting Antibiotic of critical care Range. Second is Specialty Segment is Neurosurgery Segment in which we are going to target Osmotic Diuretics & Steroid Therapy. Besides, the Registration process started in Government Medical Store Depot.

Information Technology

Information Technology (IT) played a pivotal role in FY22 in evolving to the new normal owing to the pandemic and subsequent lockdown. IT facilitated in providing data and ecosystem to employees to work from home and easily exchange the data, emails, messages, etc.

We have already committed to aligning ourselves with the evolving scenario around us by adopting the latest technology such as laying fibre optics for the networking backbone and shifting to smart switches and network analysers. We have also shifted our mail server to the cloud for global access. For efficient and faster warehouse transactions, we have automated the process of warehousing. In FY22, the processes were upgraded and streamlined further.

Setting a Secure Network

We introduced the 0-365 (an online version of Microsoft Office) to the Company. With 0365, users could access the files stored in the cloud and hence worked collaboratively as a team. With the launch of the global messaging system (Teams), online meetings, chats, voice messaging and video-conferencing could be done among employees. The Company also provided the facility of VPN for data to be shared among users securely. SpineBMS (ERP system) was opened globally so that the routine entries of ERP can be done from home and quick decisions (based on the ERP data) can be taken sitting at home. For enhanced data security, the Palo-Alto firewall was also installed.

Laying the IT roadmap

As the world moved toward the digital way of doing business, the Company remained committed to embracing new IT technology and processes. Several projects were launched in FY22, and they helped the Company and the people immensely.

We introduced AI/ML-based algorithms. Online payment gateways systems were effectively launched. The whole LAN/network was upgraded with smart switches. Internet speed was increased to lOOmbs.

We have been able to successfully use the Internet of Things (loT) for the collection and analysis of product-related data. Last year, product quality and efficiency were improved with loT. The DTR helped in connecting with customers directly Our initiatives filled up gaps between the customer and the Company and improved customer satisfaction to a great extent.

Major projects launched

To make internal processes smart and streamlined, many solutions including an automated order processing system, retail billing system, new warehouse (VFC) with barcode automation, etc. were launched. For quicker and more effective decision-making, a Bl tool like Tableau was also launched. Automatic ticket system, workflow management system and project management systems with the introduction of ClickUp software streamlined services and workflow. For better customer service, ClickUp was introduced by us, which proved instrumental in enhancing customer relations.

Logging into tomorrow

A centralised automated data backup and archival system will be initiated in FY23, which is expected to consolidate the processes to a great extent. Besides, a plethora of new launches and upgrades are in the pipeline, which are expected to be launched during the next fiscal.

A newer version of SpineBMS NextGen will be launched. Automated machines like weighing machines with data integration with ERP will be launched. On-road to digitisation, all the hard data like files and vouchers would be scanned and stored as a soft copy in PDF format for quick and easy access.

Health, Safety and Environment

For manufacturing operations, the Company has a well- defined standard operating procedure (SOP) in place and a comprehensive SHE manual for the same. Firefighting training was organised in coordination with fire & safety departmental officials for the employees.

Two Training/Safety drills were organised in the last 4 months and covered 60 employees, who received training for two hours. Not a single case of injury or fatality was reported in this fiscal.

The Company empanelled a private hospital for any emergency while medical check-up camps and eye check-up camps are organised every six months. Emergency numbers are displayed on the premises and Govt Emergency number lists are made available with security. Emergency exit maps, signages and posters are displayed prominently.

Safety initiatives

The Company has adequate infrastructure in place to ensure the safety of its people. Fire Extinguishers, Fire Hydrants, Fire Alarms, and Smoke Detectors have been installed extensively on the premises and are maintained periodically. Safety equipment is installed in key locations along with First Aid boxes.

New installation of Fire equipment at required locations has been on FY22 while replacement and maintenance of the safety equipment were also executed properly.

Besides, safety training and drills are organised quarterly on premises. Blackout locations are identified and emergency light arrangements are made at those locations to eliminate interruptions. Moreover, safety posters in Hindi are strategically placed inside the premises at key points.

Safety during Covid

A Special Covid Committee was put in place that regularly monitored the situations for implementation of the guidelines issued by the Government. The company made it a point during the Covid second wave to execute sanitisation individually, on items and space. Hand sanitiser was placed at entry points to minimise the spread of the virus on the premises. Social distancing was vehemently practiced too.

It was ensured that all employees get vaccinated for Covid. Vaccination camps were organised on the Company premises to facilitate employees to get jabs. Covid precaution SOPs were prepared in Hindi and circulated. The department ensured they are implemented to the fullest. Members of the Covid Committee were in constant touch with employees to make them aware of developments and induced the practice of Covid appropriate behaviour.

Health

The Company remained committed to keeping its people healthy and focused all the time. For this, medical check-ups and eye check-ups of employees are done every six months, where eye tests, blood tests, X-rays and ECG are done if required to assess the health and well-being of employees.

On the other front, majority of the employees are covered under ESIC and others under Mediclaim policy coverage to ensure proper treatment in times of need. ALL employees on the Companys rolls are covered under the health scheme.

Environment

To stay vigilant in conserving and nurturing the environment. For this, the Company recycles treated water for gardening and washing roads. The Company undertakes an environmental monitoring test every six months for ambient air, DG exhaust and boiler stack. Besides, a wet scrubber is installed on the boiler to reduce air pollution and DG is enclosed by the canopy to reduce noise pollution.

The company recently replaced the induction motor of AHU with the EC blower to reduce electrical power consumption and also installed a steam coil in DHU in place of an electrical heater. Moreover, the Company has plans to install a solar power system in the future.

In the quest for a green future, the Company has taken steps to increase the green cover in the nearby areas. Besides, the green area is maintained outside the premises and tree plantation was recently done.

Human capital

Our people are our greatest asset. We believe that a happy workforce is essential to imbibe excellence in work culture.

This year, in addition to our management processes, we focused on standing by our people during Covids second wave. A slew of measures were taken by the Company to ensure safety, and support for every employee of the Company. This strengthened our bond with our people to a new level.

1. Covid Measures

Opening and operating a business during the pandemic was a milestone in itself, in which we have achieved success. Our business goal is to operate effectively and efficiently while keeping our employees and customers safe. For this, we implemented a comprehensive Covid Action Plan spearheaded by a dedicated committee comprising resources drawn from multiple departments.

Covid Action Committee

To neutralise the Covid threat and its associated apprehensions at the workplace, Venus Remedies constituted a Covid Action Committee. This created an enabling, positive and safe work environment for our employees as we dealt with Covid-19 issues in day- to-day work. The company was committed to aiding all employees during the pandemic and ensured smooth functioning at all locations.

Sanitisation

Adapting a culture of regularly cleaning the surfaces of desks and workstations, doorknobs, telephones, keyboards and working objects with disinfectant and regularly sanitisation of common areas such as Plant entrances, etc. largely contributed to keeping the workforce Swachh and Swasth.

Social Distancing

We ensured staggered lunch break timings. Employee workstations were set up with alternate sitting spaces, extended to meeting rooms, etc. to make sure the appropriate social distancing within the Company.

Work from Home During the pandemic, many employees depending on their roles were allowed to work from home temporarily as an effective measure to minimise the risk of contracting the pandemic and coordinating the smooth running of business activities.

Shopfloor Operations

No doubt, being in the business of pharmaceuticals, we had to carry on with our operations without disruptions. We followed all Covid appropriate behaviour and precautions, and we were eventually successful in serving our customers by keeping the shopfloor abuzz.

• Medical protective gear

Face masks, face shields, hand gloves, etc. were extensively used to control the spread of Covid among the employees working within the Company. Full body sanitisation of employees was done at entry and exit points while thermal scanning was also practiced to curb Covid spread.

• Connecting with employees

Maintaining a continuous connection with employees was essential to making them adhere to Covid guidelines.

It was a challenge, and we overcame that through Pep Talks, issuing circulars, etc. Also, we needed a positive environment at that time to keep the morale of the employees high. We were successful in motivating our team and guiding them past rumors and misconceptions by providing them with authentic information about Covid and its impact.

Vaccinate Venus Drive

We organised vaccination camps within the Company to get the maximum number of employees vaccinated at both our Panchkula and Baddi units. The company also made tie- ups with government hospitals and dispensaries to get the employees vaccinated as per the availability of doses.

Going the Extra Mile

• Hospitalisation

Our Covid-19 taskforce committee members made great efforts to ensure the availability of beds in hospitals for employees and their family members, who needed critical care or medical support.

• Medical expenses & insurance

Majority of our operational employees are covered under ESIC and others at the managerial level or who do not fall under ESIC are covered under the medical insurance policy, which covers the medical hospitalisation expenses for all critical diseases.

• Covid protection policy

In case of death of any employee, the Company is committed to providing financial assistance to their dependants by paying his gross salary for up to 1 year to the family.

2. Building the team

About the team

The Venus team is the right mix of dynamic and experienced professionals, who are committed to propelling the Company towards excellence. The team, with 960 employees, is an embodiment of equal opportunities in the workplace. The team comprises 838 male employees and 122 female employees. Also, employees association with the Company is usually long-term, which showcases their commitment to their growth and development. More than 380 members have been associated with the Company for more than five years.

Recruitment

About 300 exuberant and dynamic professionals were added to the workforce in FY22. Their potential and fresh perspective are expected to bolster the Companys growth and set new goals in this dynamic marketplace.

Employee Growth To set a process, where the employees immediate superior / management head reviews the performance of each staff annually, our robust Performance Appraisal Review System has been formulated. The mantra for overall development encompasses focus on the development and utilisation of an employee, transparency and openness in the system, emphasis on the potential assessment and career plan of an employee, identification of training, development needs and improvement areas, reviewing job expectations

Learning and Development

Around 250 employees were trained for their growth and development. 2,740 manhours of training were imparted throughout the year. The training was both technical and behavioural encompassing both classroom and e-learning modules

Training programmes included language courses in French, Spanish, German, Mandarin, Arabic, and Russian. New technical courses were introduced like Design thinking, Red Teams Training, Post Graduate Certificate Program In Drug Safety and Medical Review For Physicians, Python & MYSQL.

Besides, a Seminar on Change your Thoughts, Change your Life & POSH Training was also conducted.

English Vinglish Club, Self- Awareness Trainings and Customised Training from IMD Department and Table Etiquettes training for HOD were also executed for development and engagement with employees

Employee engagement

There are various events organised under the employee engagement programme to make employees feel a sense of belongingness with the Company. Monthly birthday celebrations, celebrating festivals, organising various motivational seminars and expert talks, the Companys raising day celebrations, participating in various exhibitions related to Pharma, etc. are primarily focused by the Company.

The Company also celebrates milestones and special days, conducts sports and cultural activities and promotes business- related activities. Cultural events were organised on Independence Day, Republic Day, Teachers Day, Dusshera, Diwali, Xmas, Karwa Chauth, Vasant Panchami, and Venus Independence Day. To up the recreational quotient, Freedom Run was organised.

The initiatives and celebrations undertaken throughout the year bonded employees as a cohesive workforce.

Reducing attrition

The strength of an organisation is its people. If we recognise their talent, develop their capabilities and utilise them appropriately, they will contribute to the long-term excellence of the organisation. Therefore, it is imperative to assess objectively their performance and growth potential.

HR Policies

To keep up with the dynamic and changing needs of the workforce, workplace policies need to reflect both ongoing and impending shifts. Venus addresses the latest trends by updating employee policies and manuals to set clear boundaries and ensure transparency in the workplace and promote healthy business practices. We believe there is always scope for improvement. Making ourselves a great place to work is a continuous process, and we strive for perfection persistently. In line with a Science at heart and patients in mind strategy, we practice what we preach by focusing on people-oriented HR policies to provide a conducive environment for our employees.

Financial Performance

Venus Remedies reported a healthy performance in FY22. The Company reported good growth in its revenue from operations - its climbed to 2598.65 crore in FY22 against 2548.12 crore in FY21. This improvement was owing to healthy traction of its products in the domestic market and its widening global footprint.

Growing business operations and rising inflationary pressures impacted business profitability as EBITDA dropped from 275.40 crore in FY21 to 270.42 crore in FY22. Profit for the year also declined to 240.72 crore in FY22 against 261.77 crore in FY21.

The Company ploughed business surplus which resulted in an increase in the Shareholders Fund from 2400.28 crore as on March 51, 2021 to 2440.45 crore as on

March 51, 2022. The book value per share moved up from 2525 to 2529 during the same period.

Current Assets increased from 2254.05 crore as on March 51, 2021 to 2278.04 crore as on March 51, 2022. This was due to an increase in inventories and receivables. Current Liabilities dropped marginally from 297.45 crore as on March 51, 2021 to 292.74 crore as on March 51, 2022.

Significant changes i.e. change of 25% or more in the key financial ratios

In accordance with the amendments notified by SEBI in Regulation 17 of the SEBI (Listing Obligation and Disclosure Requirement) Regulation, 2015 on 9th May, 2018, the details of significant changes i.e. change of 25% or more in the key financial ratios as compared to the immediately previous financial year along with detailed explanations are reported here under:

Ratios	2021-22	2020-21	Change	Reason for Change
Current Ratio	3.00	2.40	25%	Due to decrease in current liabilities and increase in current assets
Debt Equity Ratio	0.10	0.13	(24%)	Due decrease in debt
Net Profit Ratio	6.71	10.88	(38%)	Due to extraordinary items on account of debt repayment in the previous fiscal year.
Return on Capital Employed	7.59	12.21	(38%)	Due to extraordinary items on account of debt repayment in the previous fiscal year.
Debt Service Coverage Ratio	7.24	0.67	987%	Due decrease in debt
Return on Equity Ratio	0.10	0.17	(43%)	Due to extraordinary items on account of debt repayment in the previous fiscal year.

Internal Control & its Adequacy

Venus maintains a system of well-established policies and procedures for internal control of operations and activities. It continuously strives to integrate the entire organisation - from strategic support functions like finance, human resource and regulatory affairs to core operations like research, manufacturing and supply chain management.

The internal audit function is further strengthened in consultation with statutory auditors for monitoring statutory and operational issues. The Company has appointed independent agencies as internal auditors. The prime objective of this audit is to test the adequacy and effectiveness of all internal control systems and suggest improvements.

Managing Business Headwinds

Risk management is critical to an enterprises overall profitability, competitive market positioning and long-term financial viability and to meet commitments to clients and other stakeholders. Venus has put in place a strong risk-management structure that enables meticulous examination of business activities for identification.

Growth risk: The Company needs to sustain its growth momentum to move into the big league.

Mitigation measure: Venus is working on multiple strategies to accelerate business growth.

It has focused on widening its global footprint to be able to access and capitalise on interesting growth opportunities in regulated and pharmerging markets. Additionally, the Company is expanding its product basket selectively - customised to the opportunities in each nation. This will allow it to offer the right product basket in the right market.

Profitability risk The Company needs to improve business profitability.

Mitigation measure: Venus is working on rebalancing its revenue between acute and chronic therapies to improve overall business profitability. As a first step towards this end, the Company is increasing its thrust on marketing its oncology basket in international markets. This would allow it to increase the proportion of its high-margin business in its overall revenue pool.

Cost risk: The Company needs to optimise costs to improve returns from business operations.

Mitigation measure: Venus continues to seek newer ways of improving operational efficiency to combat inflationary pressure.

In FY22, the team worked on several high-volume products to improve their productivity which helped the Company to optimise the overall cost of production. The Company is also deploying relevant IT solutions that will allow it to sustain product quality while improving plant efficiency. R&D risk: The Company needs to have a robust pipeline of products for the future to drive profitable business growth.

Mitigation measure: Venus has developed a unique IT solution that allows it to scan all possible product development ideas and opportunities and narrow it down to the best products based on multiple filters. In FY22, this solution has thrown up more than 20 product development ideas, most of which are at various stages of development.

Sustainability i The Company needs to optimise its carbon footprint to sustain business growth over the foreseeable future.

Mitigation measure: Venus understands the urgent need of reducing the burden of its operations on the planet. To make a definitive impact, the Company has undertaken an organisation-wide study to gain an insight into its existing carbon footprint. This will then become the platform for making the requisite changes in its business operations to optimise its carbon footprint.

Corporate Social Responsibility

Venus is an organisation that is immensely proactive in fulfilling its corporate social responsibility (CSR) goals. The people of the Company are a force of highly dedicated members, who have pledged to selflessly uphold the Values, Ethics and Culture of the Organisation.

The aim of our social responsibility endeavours is to build a battalion of soldiers, who really have strong bonds between them and can work together to meet both external and internal challenges, and achieve the goals cohesively.

It serves as the outpost for our corporate social responsibility activities, some of which are:

Manav Uthaan Yojna: The scheme is aimed at reaching out to people in need and uplifting their life and lifestyle. Under this Manav Uthaan Yojana , Venus is committed to providing financial aid every month to Manna at the Desert Society, a Jaipur-based welfare society and Tek Chand Sud Memorial Trust, which is taking care of special children. Moreover, under another scheme, Griha Lakshmi Yojana, Venus distributes grocery and other household items to its workers on the 10th of every month.

Social Uthaan Yojna: This scheme of the Company aims at the social upliftment of people. Under this social welfare scheme, the organisation organised various festive celebrations that provided a common platform for the people to connect socially.

Environment Uthaan Yojna: This scheme is aimed at conserving the environment and laying the foundation for a green future. Under Environment Uthaan Yojna, Venus is continuously donating 1,000 trees every month through Isha Trust - Cauvery Calling. It is significantly symbolic that the Company is donating one tree on behalf of each Venusians every month in addition to other plantation activities that are undertaken from time to time.