Taking the Lead

Annual Report 2019-20 Our founder, Dr. Desh Bandhu Gupta believed in Tagore’s maxim that ‘Life must not be the infinite elongation of a straight line.’ This is more true today than ever before, as we see every line of Society and the Economy being stretched or bent, if not broken. DBG believed that the broadest shoulders must carry the heaviest burdens. We are humbled and honored that we can be counted on to take the lead at this time – to bring new products and therapies to market, to ensure access to affordable, quality healthcare, to guarantee the safety and well-being of all our stakeholders and to wholeheartedly give back to Society.

Count on us to take the lead Contents Corporate Overview Statutory Reports

2 A Tribute to Our Founder 48 Directors’ Report 4 Our Global Footprint 84 Corporate Governance Report 6 Pharma in a COVID-19 World 103 Independent Auditor’s Certificate 8 Financial Highlights on Corporate Governance 10 Chairman's Letter 104 Business Responsibility Report 12 Vice Chairman's Letter 14 CEO & MD’s Letter Financial Statements 16 United States 117 Independent Auditor's Report 18 India on Consolidated Financial 20 Latin America Statements 21 Asia Pacific 126 Consolidated Financial 22 Europe, Middle East and Africa Statements 24 Active Pharmaceutical Ingredients 210 Independent Auditor's Report on Standalone Financial 26 Research and Development Statements 30 Global Manufacturing & Supply Chain 220 Standalone Financial 33 Quality and Compliance Statements 34 Environment, Health and Safety 36 Financial Review 38 Human Resources 40 Corporate Social Obligation 42 Board of Directors 44 Awards & Recognitions 45 Corporate Information 46 Ten Year Financial Summary

in the U.S. by in Anti-Hypertensive #3 Prescriptions #1 Segment in the U.S.

in 63 Products Brands in the # in the U.S. Top 100 Brands 1 3 of India

Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We Across Chronic Generic Player in receptive to changes in working see upskilling of talent and ##Therapies in India Australia and patterns and privacy norms with equipping our people with South Africa health and travel declarations abilities to work remotely, with 4 becoming common. Companies a deeper understanding of 4 will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit. Dr. Desh Bandhu Gupta 1938 – 2017 Founder and Former Chairman

Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

02 Corporate Overview Statutory Reports Financial Statements

Dr. Desh Bandhu Gupta (DBG, as we all call him) was a visionary, with a compelling view of the future, for Lupin and for India. He was deeply committed to the idea of India that he envisioned – a technological powerhouse and an inclusive nation, leading the world. Lupin today bears his flag of ambitious optimism, relentless passion, and public spiritedness, as it takes on global challenges in Research, Manufacturing and Marketing. DBG always said investing in his people and contributing to their overall development is what makes us powerful. Lupin is a formidable influence in the world today, with our unique culture of empowered employees working towards a collective goal. The path we walk is paved by DBG’s values that influence every decision and engagement with our team, customers, and society. Right from the start of the COVID-19 pandemic, as in our business, our actions demonstrated the amazing spirit of our Lupinytts, the relentless “never give up” attitude that we learnt from DBG, living by his words, “I firmly believe that Lupin is a great company with great people doing great work.” Our single-minded goal through the COVID-19 crisis has been to ensure that we can be counted on to take the lead – to ensure access to our affordable, quality products, to guarantee the safety and well-being of all our people, and to give back to Society. We have a lot to do. Make ourselves stronger. Grow faster. And to do all this sustainably, creating a benchmark of excellence in research and manufacturing in a rapidly changing world. Building a pharmaceutical giant for India, and the World. DBG’s belief in people, deep concern for the good of Society and a Company based on values, made him deliver the unimaginable. Today more than ever, we see what DBG saw a long time ago – Lupin is not just a business, it is a vehicle to do good for Society.

Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Lupin Limited | Annual Report 2019–20 03 Our Global Footprint

Manufacturing Research

USA New Jersey

Florida

Mexico

Brazil

Quality, Manufacturing & Compliance:

India: Aurangabad, Ankleshwar, Dabhasa, Goa, Indore, Jammu,

Mandideep, Nagpur, Pune, Sikkim, Tarapur & Vizag

U.S.: New Jersey; LATAM: Mexico & Brazil

Research:

India: Pune & Aurangabad; U.S.: New Jersey & Florida Employees need to imbibe a limited headcount and ensuring LATAM: Mexico & Brazil; Europe: Netherlands safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and Marketing & Corporate Development: patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with More than 20 offices across the globe becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

04 Corporate Overview Statutory Reports Financial Statements

Netherlands

India

The Philippines

Jammu

Sikkim Indore Dabhasa Mandideep Ankleshwar Aurangabad South Africa Tarapur Nagpur Pune Australia Vizag Goa

Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with euippi our peope ith health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Lupin Limited | Annual Report 2019–20 05 Pharma in a COVID-19 World Leading the Change

A humanitarian crisis of the scale of the COVID-19 pandemic presents times of great uncertainty and change. While industries and individuals are grappling with the challenges, the global pharmaceutical industry has taken center stage in the fight against COVID-19, its contribution ranging from vaccine development, research on repurposed and novel medicines, production of testing kits, and support to frontline workers and the needy. In light of the COVID-19 pandemic, the pharma industry will also witness massive shifts in R&D, supply chain, operations, digital adoption and talent management. At Lupin, we are using this challenge as an opportunity to become more resilient, more efficient and more focused on bringing quality, affordable treatments to market faster to help improve outcomes for patients.

Ensuring business continuity

Being a part of Essential announcing several incentives Services, the pharma industry to set up API units to boost has been particularly At the peak of the disruption domestic manufacturing in responsive to the disruption in April 2020, Lupin sites still India and mitigate risk of caused by COVID-19 and taken delivered 90% of their supply chain shocks from exemplary and expedited steps formulations target and 120% external sources. At Lupin, we to ensure business continuity. In of their API target are using this opportunity to fact, the Operations model of reassess our manufacturing pharma companies has become footprint, de-risk in-line a ready working model for A March 2020 survey conducted products and engrain resumption of manufacturing by the Institute for Supply Chain flawless execution as a operations across industries. Management, stated that nearly key differentiator. Overcoming input material 75% of companies reported disruptions and logistic supply chain disruption in one challenges, our commercial and Lupin has less than 30% operational teams at Lupin are form or the other due to coronavirus-related dependence on early raw working closely with our materials and intermediates customers and government transportation restrictions. agencies to ensure that we are Companies across sectors are from China and our supply able to maintain a consistent reevaluating their strategies to chain ensured that we supply of our products, address supply chain risks. The remained insulated from including those for the Government of India has supply disruption treatment of COVID-19. indicated its support by Safeguarding the health and safety of our people

Right at the onset of the at each site. We have seen our work or in cafeterias, to using Employees need to imbibe a limited headcount and ensuring COVID-19 crisis, we rolled out manufacturing leaders step up Personal Protective Equipment safety-conscious mindset and be 100% productivity at sites. We harmonized plans at all our and ensure that while we (PPE) at all times, they have left receptive to changes in working see upskilling of talent and manufacturing sites and continue manufacturing our no stone unturned. Our Supply patterns and privacy norms with equipping our people with offices. The comprehensive much-needed essential Chain and Procurement teams health and travel declarations abilities to work remotely, with plan to prioritize the health medicines, the safety of our ensured optimal supply of PPE becoming common. Companies a deeper understanding of and well-being of all Lupinytts people is not compromised. and sanitization materials, will also have to balance the twin digital possibilities but still integrates with the existing Right from screening and while there was an ongoing imperatives of maintaining retaining the Lupin spirit. efforts of independent teams ensuring social distancing at global shortage.

06 Corporate Overview Statutory Reports Financial Statements

Global Giving programs

COVID-19 has stretched the family contributed INR 100 meals for front-line workers and world’s resources severely, and Million to together set up the the needy. We are humbled and corporates and institutions have Lupin COVID-19 Relief Fund to proud of the difference that we stepped up like never before. drive initiatives that support have been able to make. Lupin’s product portfolio overburdened healthcare Lupin’s Global Giving Programs (including products pending systems through donation of extend to our communities approval) includes many PPEs, medicines and provide for products related to the across India, U.S., Latin America treatment of COVID-19 including and Europe. In addition to Azithromycin, Hydroxychloroquine To date Lupin has donated numerous measures that we and Albuterol as well as other flu, 2.38 Million masks, carried out directly, the Lupin antibiotic and antiviral products. 1.12 Million medical COVID-19 Relief Fund has equipment, 130,800 PPE contributed meaningfully to the Our employees raised suits, 470,000 sanitizers, PM CARES Fund in India and INR 55 Million by contributing 208,200 food kits and two days of their salary and supported healthcare facilities supported 93,000 migrants across the severely affected Lupin contributed a matching during the COVID-19 crisis sum of INR 55 Million. In addition, regions of New York, New Jersey, the Dr. Desh Bandhu Gupta Baltimore and Florida.

Leveraging opportunity The U.S. spends about 17% of its supplies to the U.S. market by GDP on healthcare. According to volumes. With more emphasis a report by IMARC, the global on global drug supply security, With 30 Billion+ generics drugs market is we expect Indian generic majors extended units capacity, expected to reach US$ 497 Billion to benefit by further leveraging 85% of Lupin’s products by 2025. India stands to gain as a our low-cost base, high marketed in the U.S. are leading provider of generic throughput, quality standards supplied from India medicines to the U.S. India and the skill set required to take accounts for 46% of generics on newer challenges. Embracing digital

A key step in risk mitigation unleash cost optimization against future disruptions will be possibilities and drive the creation of flexible operating During COVID-19, Lupin was efficiencies in ways never models, increasing automation the first Indian pharma imagined before. and reliance on technology to company to suspend field At the same time, we as an minimize human interface. operations and introduce a Further, uptick in digital industry, deal with sensitive Digital platform for information that is required to promotional activity is likely with comply with several regulations. physicians advocating for more customer engagement through which our field We now see Digital becoming a patient engagement on virtual key anchor of our strategy, platforms with promotion moving force could connect with having deep impact on our into the virtual space. We see that doctors effectively research, manufacturing, quality, Industry 4.0 adoption would commercial and other allied operations. Managing talent

Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with During the lockdown, Lupin health and travel declarations abilities to work remotely, with rolled out close to 200 becoming common. Companies a deeper understanding of online programs and had will also have to balance the twin digital possibilities but still 15,000 enrollments imperatives of maintaining retaining the Lupin spirit.

Lupin Limited | Annual Report 2019–20 07 Taking Stock Financial Highlights

Profit and Loss Metrics 153,848 153,848 33,942 33,942 151,428 151,428 143,181 143,181 135,648 135,648 7% 18,132 9% 9% 8% 17,452 17,452 15,054

93% 92% 91% 91% NET SALES NET ` in Million PROFIT TAX* BEFORE PROFIT ` in Million FY17 FY17 FY19 FY18 FY18 FY19 FY18 FY20 FY20 FY20

Formulations API *Numbers reported above are before exceptional items 24,503 22,269 17,749 15,538 15,013 12,427 9,088 14.5% 8,521 13.1% 10.5% 10.3% R&D ` in Million and as % of Revenues PROFIT* NET ` in Million FY17 FY17 FY19 FY19 FY18 FY18 FY20 FY20

*Numbers reported above are before exceptional items # 43,501 7. 5 0 6.00 6.00 28,937 5.00 5.00 5.00 5.00 28,884 28,386 30% 27% 18% 14% EBIDTA ` in Million DIVIDEND % Ratio and Payout Share Per FY17 FY17 FY19 FY19 FY18 FY18 FY20 FY20

*All P&L metrics are restated for #Payout Ratio calculated using Adjusted EPS continuing operations excluding Japan

08 Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Corporate Overview Statutory Reports Financial Statements

Balance Sheet Metrics

NCE Licensing 137,422 137,422 Income 135,771 135,771 API 125,367 134,976 134,976 1% 9%

Domestic Formulations Advanced 34% Markets REVENUE Formulations

NET WORTH NET ` in Million MIX 45% FY17 FY19 FY18 FY20

Emerging Markets Formulations 12% 0.41 0.41 0.38 0.38 0.38 0.38

API NCE APAC Licensing Income 4% 9% 0.12 0.12 ROW 1% 2%

LATAM NET DEBT TO EQUITY RATIO EQUITY TO DEBT NET Ratio 4% FY17 FY19 FY18 FY20 North GEOGRAPHICAL America EMEA 38% 8% MIX 2,36,703 2,36,703 2,28,000 2,28,000 2,19,232 2,19,232 India 2,02,705 2,02,705 34% CAPITAL EMPLOYED CAPITAL ` in Million FY17 FY19 FY18 FY20

Capital Employed Defined as Equity + Reserves + Long Term Liabilities + Current Borrowings + Current Portion of Long Term Borrowings

Lupin Limited | Annual Report 2019–20 09 Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Chairman's Letter

Our actions during the COVID-19 crisis reflect the strong influence of our core values on each Lupinytt.

10 Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Corporate Overview Statutory Reports Financial Statements

Dear Shareholders

I am pleased to present to you Lupin’s FY20 back its rightful place and becoming the global Annual Report. benchmark for Quality and Compliance. FY20 was a good year. In addition to recording As a company, we made substantial progress in growth across all our geographies, we made focusing on the essentials and strengthening our significant progress in the year to ensure that we financials. With the divestment of Kyowa, Japan in continue on this growth path. Inspite of the odds, FY20, we have strengthened our capital structure we have demonstrated that the right strategy, to invest in our priorities and strategic focus areas. focus and geographical footprint will deliver consistent and sustainable growth. The global COVID-19 pandemic that we have all been facing together since the last quarter of In FY20, our India branded products business FY20, has strengthened our resilience as a recorded double digit growth, driven by new company and our commitment to human-kind. product introductions and a strong thrust on brand Even during the lockdown, despite debilitating building. Our Global Institutional Business hit challenges, we delivered on our commitment and multiple milestones in building a broader offering ensured the supply of much needed life-saving of life-saving TB and HIV medicines, taking medicines. I am proud of our team’s efforts in forward Dr. Desh Bandhu Gupta’s commitment to giving back across all our geographies. We Society. In the U.S., our generics business is seeing continue to engage in activities that complement signs of price stability after successive years of governmental relief efforts – distributing price pressure. We are committed to bringing medicines, meals, food kits and PPEs. much-needed products to market – our Levothyroxine is now ramping up to a meaningful There is a quote that echoes my feelings very share and we continue our progress on complex closely, “Adversity does not build Character, it generics and biosimilars. In a significant reveals Character”. In the COVID-19 crisis, the true development, our Etanercept biosimilar has now values and character of the Lupin team have been received European approval. revealed – and it is something that DBG would be proud of. Likewise, in Europe, we have made good progress in building our specialty business around I would like to thank all our employees for their NaMuscla® – an important product for managing a hard work and commitment thoughtout FY20. But rare, inherited neuromuscular disease. most of all, I would like to thank you, our shareholders and customers for your continued On the manufacturing front, we continue to build support as we look forward to a successful FY21. our capabilities and strengthen our processes. Through our robust efforts in implementing Warm regards, important initiatives in Quality and Compliance, we now see consistent positive outcomes from Manju D. Gupta regulatory inspections. In this, I see Lupin earning Chairman

Lupin Limited | Annual Report 2019–20 11 Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Vice Chairman's Letter

By taking in our stride the learnings of the past few years and acting upon them, we have embarked on a journey of transformation that leads to sustainable growth.

12 Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Corporate Overview Statutory Reports Financial Statements

Dear Shareholders

It gives me immense pleasure to write to you. As we close FY20 on a high note and move into FY21, with multiple manufacturing sites clearing regulatory inspections, a stronger- than-ever portfolio of approved products, and a robust product pipeline awaiting approval, I believe we are at an inflection point. By taking in our stride the learnings of the past few years and acting upon them, we have embarked on a journey of transformation that leads to sustainable growth. Our businesses across key geographies have recorded strong growth with India and U.S. leading from the front and accounting for 72% of global revenues. We have 174 products in the U.S. generics market out of which 63 are No. 1. This is a commendable achievement, one that reflects our strength in the generics segment. We invested 10.3% of our revenue into R&D, a lot of it into complex platforms that will serve as the blood line for future growth and progress. We have 43 First-to-File products pending launch, with an estimated market size of US$ 43.6 Billion, and 14 of these are exclusive opportunities. Manufacturing is our strength and in Q4 FY20 and Q1 FY21, we received positive audit outcomes from U.S. FDA for all our facilities that were inspected in this period. Despite testing times brought in by the COVID-19 pandemic, our manufacturing and supply chain teams across geographies remained solid, focussing on the customer and delivering on supply chain commitments. The COVID-19 crisis further reinforced our belief in our people. It once again highlighted a Lupin trait, the strong will of Lupinytts, one that makes us overcome every obstacle in our way. The respect we have earned during the crisis by standing by our people, continuing to supply medicines globally and supporting our communities should make each one of us proud. It is reflective of the values that our founder Chairman, Dr. Desh Bandhu Gupta stood for. As we move into FY21, it will be important to sustain growth momentum and surge ahead. We are well-poised to take off on a robust trajectory and enter new realms of enterprise growth and profitability.

Thank you, Dr. Kamal K. Sharma Vice Chairman

Lupin Limited | Annual Report 2019–20 13 Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

CEO and MD’s Letter

We are committed to deliver on differentiated products, flawless execution, cost optimization and attaining global quality and compliance standards.

14 Employees need to imbibe a limited headcount and ensuring safety-conscious mindset and be 100% productivity at sites. We receptive to changes in working see upskilling of talent and patterns and privacy norms with equipping our people with health and travel declarations abilities to work remotely, with becoming common. Companies a deeper understanding of will also have to balance the twin digital possibilities but still imperatives of maintaining retaining the Lupin spirit.

Corporate Overview Statutory Reports Financial Statements

Dear Shareholders

The last quarter of FY20 saw during the year, excluding U.S. On New Drug Development, the pharmaceutical industry Ranolazine, on the back of our team recorded its second win rallying together at a difficult important products like with the successful licensing of our time, taking charge of action Levothyroxine and Oseltamivir lead MEK inhibitor compound to against the COVID-19 crisis. outpacing in-line product Boehringer Ingelheim. This builds From repurposing existing drugs declines. We retain the #3 upon last year’s successful pact to the hunt for a vaccine, position in the U.S., accounting with AbbVie for Lupin’s MALT1 ramping up R&D efforts while for 6.3% share of generics inhibitor program. ensuring supply of essential prescriptions dispensed, aided drugs amidst unprecedented by our leadership in chronic Our India business continues to disruption, all while therapies. We expect to outperform the Indian safeguarding the health and continue our ramp-up of Pharmaceutical Market with 13% safety of employees, the Levothyroxine and look forward YoY growth. Our focus on brand industry stood taller than to the launch of our first major building has helped us elevate ten ever before. inhalation product, Albuterol in brands to the Top 300 from just six the coming fiscal (pending in FY18. We are truly proud of how our FDA approval). The hard work and focused Lupin team stepped up to execution by our team on Quality respond to the crisis. We During the year, we filed 21 and Compliance has seen an established and communicated ANDAs, two of which were inflection point. We now have a dual mission, to keep our confirmed exclusive consecutive positive outcomes for Lupinytts safe while First-to-Files. We now have the five U.S. FDA inspections maintaining our supply of over 158 ANDAs pending conducted in Q4 FY20. Through life-saving medicines for the approval with the U.S. FDA; a our robust efforts in implementing patients and communities we rich pipeline addressing a total important initiatives like Quality serve. Our Manufacturing and market of over US$ 71.7 Billion First as well as undertaking Supply Chain team responded comprising of inhalation, specific remediation activities, our with characteristic agility to first-to-files and track record has started reflecting ensure supply continuity while injectable products. our commitment to be the global we rapidly adapted to new ways benchmark in Quality and of working for our Our Complex Generic portfolio Compliance for the Manufacturing, Research, Field meaningfully advanced in FY20. pharmaceutical industry. and Office staff. This rapid On the inhalation front, gFostair® execution and speed of is the anchor product for our Our top priority for FY20 was to socializing best practices inhalation business in Europe get Lupin back on the growth path, globally, demonstrated our and we expect to launch it in from the decline we saw in FY19. agility, spirit of excellence as the U.K. in FY21. Importantly, we We have made significant progress well as our values of Respect received European approval for in this effort, as well as in and Care. In addition, the spirit our Etanercept biosimilar and optimizing our costs on several of Lupin shone brightly through expect to launch it in FY21. We fronts. We are confident that our our giving efforts in India, the also remain on track for our performance will reflect the same U.S. and many other parts Pegfilgrastim U.S. filing and now over the next few quarters as the around the world. have global trials ongoing global situation normalizes. for Ranibizumab. In FY20, we achieved an EBIDTA At Lupin, FY20 was a year of margin of 18.7% and recognize that focused execution. We made On the Specialty front in there is much more to be done as strong progress on our strategic Europe, NaMuscla® is our first we realize Lupin’s true potential. growth drivers, remediation orphan drug and marks our efforts at our sites as well as foray into the rare-disease We are committed to deliver on cost optimization efforts. We space. The direct-to-market differentiated products, flawless evolved and strengthened our model for NaMuscla® is now live execution, cost optimization and pipeline of complex generics and we continue to ink attaining global quality and and biosimilars and closed our marketing alliances to bring it compliance standards. Even on the second major New Chemical to a broader set of patients backdrop of a weak economic Entity licensing, further across Europe. While FY20 was global environment, we know that validating our ability to a difficult year for Solosec® in this focus will enable us to innovate. In addition, we the U.S., we believe in the generate sustainable, profitable executed a strategic divestiture potential of the product and returns for our shareholders, and of our Japan business and used hope to realize the same with a set a very bright path for Lupin. the proceeds to strengthen our more focused commercial team, balance sheet. and partnerships to expand the Best regards, portfolio. We remain committed Our U.S. business stabilized in to building a world-class Vinita Gupta Nilesh D. Gupta FY20 and saw an increase of 5% Women’s Health portfolio in the Chief Executive Officer Managing Director

Lupin Limited | Annual Report 2019–20 15 Geared to Deliver United States rd by Products Average Prescriptions Rank No. 1 Product/Market 3 63 30% Share

Over the past 5 years, Lupin’s endeavour has been to strengthen its presence in the U.S., the largest pharmaceutical market globally that accounts for more than 45% of global pharmaceutical sales. During FY20, the U.S. contributed 38% to the company’s revenues, aggregating US$ 800 Million. This is a 3% growth over FY19, largely supported by the ramp up of our Levothyroxine generic during the year. Price erosion in our legacy product portfolio was largely contained to mid-single digits. During the year, we filed 21 ANDAs in the U.S., two of which were confirmed exclusive First-to-Files (FTFs). We now have over 158 ANDAs pending approval with the U.S. FDA, a rich pipeline that includes inhalation, FTF and injectable products.

16 Corporate Overview Statutory Reports Financial Statements

U.S. Specialty commercial formularies in the In the last quarter of FY20, the U.S., the successful conclusion intensive efforts of our team began to bear fruit with Early in FY20, we triggered a of our phase 3 study in trichomoniasis, as well as our successive positive outcomes deep introspection on our for inspections at several of our Specialty strategy as our lead ongoing business development activities and internal pipeline facilities. This will help us deliver women’s health product, on new product launches whilst ® assets give us confidence of a Solosec witnessed lower than consolidating our position in expected traction. We moved significant future ahead for this our existing portfolio. swiftly to put in place a set of business. These measures will now focused initiatives. We have U.S. Generics accelerate our U.S. generics strengthened the leadership growth trajectory. team with experienced Our base U.S. generics business Throughout the year, we executives led by a new was robust in FY20, helping us proactively resolved challenges President of the U.S. Speciality deliver even amidst challenges. around supply chain issues, business, Jon Stelzmiller, who Our track record with customers channel consolidation and comes with extensive experience remains strong. ongoing U.S. FDA discussions in building women’s health Our focus on strengthening our that affected new product brands. Led by Jon, the Specialty already agile supply chain launches. During the last quarter team executed a host of backed by unparalleled of the year, we ramped up these transformational efforts, which customer service helped us efforts substantially in sync with prior to COVID-19, was set capitalize on seasonal product our global efforts to fight to build a formidable and opportunities like gTamiflu®. COVID-19. Our agile supply chain and meticulous planning durable franchise. Lupin’s product portfolio (including those pending ensured continuity of product approval) includes many of the supply in the market. We also products related to the exhibited responsible We remain committed treatment of COVID-19 such as stewardship in our communities to building a world class Azithromycin and Albuterol as by contributing substantial Women’s Health well as other flu, antibiotic and quantities of product, PPEs and antiviral products. meals to frontline workers and franchise in the U.S. the needy. In the coming year, we look forward to delivering the However, with the sharp 123 of our products, out of a total of 174, rank promise of our pipeline products reduction in prescriptions for including our first Metered Dose acute medicines and the amongst the top three Inhaler (MDI) launch in the U.S. continued impact of COVID-19 in products in their — Albuterol (gProAir®), which FY21, we have now implemented segment. Our marketed would mark an inflection point a new operating structure. A products have an average for our complex generics smaller team carries forward our market share of 30% evolution. We remain on track ambition in U.S. Specialty, but we for our biosimilar Pegfilgrastim believe it will best position us to U.S. filing in FY21. We are respond to the market, patient confident that as we move needs, and achieve sustainable During the year, we continued to ahead, an improved pricing growth, going forward. work toward reinforcing our environment, resolution of U.S. quality systems and processes FDA issues at certain facilities, Securing preferred formulary across our manufacturing and ramp-up of our recent niche status for Solosec® with Express network ensuring compliance product launches will accelerate Scripts, one of the largest with regulatory standards. our growth.

Market Share % (Gx) Generics Market TRx Ranking

Rank Corporation MAT March Mkt Share Growth 6.3% 2020 (Mn) 6.2% 1 TEVA 407 10.61% -11.89% 5.5% 5.3% 5.2% 2 AUROBINDO 329 8.58% 30.32%

3 LUPIN 240 6.27% 4.08%

4 ZYDUS 151 3.94% 21.00%

5 AMNEAL 148 3.87% 4.99% Market share % Market FY16 FY19 FY18 FY17

FY20 Data Source: IQVIA MAT March 2020

Lupin Limited | Annual Report 2019–20 17 Being the Best India th Rank in Four-Year Lupin Brands India Pharma CAGR Feature in the 6 Market 11 % 10 Top 300

Lupin’s India business is a crucial growth driver and continues to lead the way with greater profitability and value by consistently delivering best-in-class results. In FY20, our Domestic Formulations business crossed the milestone revenue figure of INR 50,000 Million and registered double-digit growth.

Domestic Formulation Sales Lupin Market Share in IPM ` in Million leadership in launching new a platform for gastroenterologists media channels, we continue to products and rank 3rd in the IPM in and similarly with Mayo Clinic engage with health care professionals through live 51,385 FY16 FY20 the 12 months New Product for Orthopedics. Introduction Index. webinars and content focused 46,382 Lupin has been at the forefront of on therapeutic advancement. 3.46% 3.61% We are focused on building digital transformation and 41,253 therapy-specific scientific technology adoption. 'Anya,' Lupin’s Lupin has also partnered with 38,157 platforms to enable long-term Health Chatbot launched in FY20, new-age startups to leverage and meaningful association with can answer queries on respiratory their digital prowess and reach 34,486 focused specialties. In FY20, ailments, Hypertension and patients for educating them on Lupin associated with the Diabetes. It can even respond in developing healthy habits and American College of Hindi and Tamil for the latter two improving adherence. Gastroenterology (ACG) to create conditions. Through our social

FY16 FY17 FY18 FY19 FY20

Lupin's Top 10 Products in Top 300 Brands list The India business continues to be the second largest business unit for Lupin, contributing 34% to BUDAMATE ONDERO the topline and significantly to the bottomline. Lupin’s branded generics sales grew by 13.6% in FY20. Lupin’s branded generic business is currently placed at 6th position in the Indian Pharmaceutical Market (IPM). The branded generics business has GLUCONORM consistently outpaced the IPM with a four-year CAGR of 11.7% vs. IPM CAGR of 9.4%. Importantly, over the last four years, we have improved our market share from 3.46% in FY16 to 3.61% in FY20. HUMINSULIN th Overall, Lupin retains the 4 position in the high ONDEROMET growth chronic segment. The chronic segment TONACT has improved in salience to 62% of total

RABLET D revenues and the acute segment contributes the CIDMUS balance 38%. IVABRAD GIBTULIO

Our top five therapies, cardiology, grown significantly in the launched three new divisions anti-diabetes, respiratory, anti-diabetes segment with focused on the urology, anti-infective and gastrointestinal growth of 18.4% versus IPM's dermatology and pediatric contribute more than 74% of total growth of 11.8%, resulting in respiratory therapy areas. We also sales. We continue to lead in the improved market share from 7.9% launched 'Adhero,' a first of its anti-TB segment and maintain 2nd in FY19 to 8.4% in FY20. We now kind Bluetooth-Enabled Smart position in the respiratory and 3rd have 10 Lupin brands that feature Device in India to support position in the anti-diabetes and in the Top 300 brands of the IPM. treatment of respiratory disease. cardiology segments. We have In FY20, Lupin successfully We continue to demonstrate

18 Corporate Overview Statutory Reports Financial Statements

Lupin’s Therapy-Wise Ranking Therapy-Wise Share of Revenue

Therapy Rank FY20 Market Share REST 4.7% Gynaecology 3.9% Cardiac ANTI-TB 1 56.6% Anti-Tuberculosis 3.6% 21.8% Central Nervous System 4.2% RESPIRATORY 2 5.8% Vitamins, Minerals, Supplements 4.4% CARDIOLOGY 3 6.6% Pain 4.8%

ANTI-DIABETES 3 8.4% Gastrointestinal 7.4% CNS 6 2.6% Anti-Diabetes GYNAECOLOGY 10 2.8% Anti-Infective 9.8% 22.3%

GASTROINTESTINAL 11 2.6% Respiratory 13.2%

leadership in launching new a platform for gastroenterologists media channels, we continue to products and rank 3rd in the IPM in and similarly with Mayo Clinic engage with health care the 12 months New Product for Orthopedics. professionals through live Introduction Index. webinars and content focused Lupin has been at the forefront of on therapeutic advancement. We are focused on building digital transformation and therapy-specific scientific technology adoption. 'Anya,' Lupin’s Lupin has also partnered with platforms to enable long-term Health Chatbot launched in FY20, new-age startups to leverage and meaningful association with can answer queries on respiratory their digital prowess and reach focused specialties. In FY20, ailments, Hypertension and patients for educating them on Lupin associated with the Diabetes. It can even respond in developing healthy habits and American College of Hindi and Tamil for the latter two improving adherence. Gastroenterology (ACG) to create conditions. Through our social

OTC

Our OTC division, LupinLife especially Lupizyme (used for the business imperatives and key Consumer Health, is committed treatment of digestion related drivers while engaging with our to bringing value-based problems) and Aptivate (an key stakeholders, doctors, offerings to consumers by appetite stimulant) that have patients and consumers. introducing well positioned bolstered the product portfolio. Along with introducing brand Our expertise in brand building, brands based on robust scientific ® focus on gaining market evidence. In FY20, LupinLife extensions such as Softovac O Our top five therapies, cardiology, grown significantly in the launched three new divisions (Orange flavor), we also initiated leadership in key therapies, and reinforced its market presence by agility to adopt digital initiatives anti-diabetes, respiratory, anti-diabetes segment with focused on the urology, multiple advertising campaigns strengthening its portfolio and will continue to propel our anti-infective and gastrointestinal dermatology and pediatric for our key brands. growth of 18.4% versus IPM's distribution reach. We continue India business towards contribute more than 74% of total growth of 11.8%, resulting in respiratory therapy areas. We also on the growth trajectory with Outlook newer milestones and a sales. We continue to lead in the improved market share from 7.9% launched 'Adhero,' a first of its double-digit growth in sales promising future. anti-TB segment and maintain 2nd in FY19 to 8.4% in FY20. We now kind Bluetooth-Enabled Smart despite headwinds in some Lupin’s India business is a position in the respiratory and 3rd have 10 Lupin brands that feature Device in India to support markets. There were several Rx sustainable growth story for position in the anti-diabetes and in the Top 300 brands of the IPM. treatment of respiratory disease. to OTC brand shifts in FY20, Lupin. We continue to work on Data Source: IQVIA MAT March 2020 cardiology segments. We have In FY20, Lupin successfully We continue to demonstrate

Lupin Limited | Annual Report 2019–20 19 Laying the Foundation Latin America (LATAM) nd th in Mexico Ophthalmic in Brazil Growth in Reference Market Reference Brazil 2 (Units) 5 Market 28% (Generics) (Units)

In FY20, the pharmaceutical market in LATAM region grew by 12%, driven by innovation in select therapeutic areas and sale of branded generics. Overall, our LATAM business recorded growth of 8.6% and contributed 4% to our overall revenues in FY20. While there has been continued improvement in healthcare access and budgetary allocation by successive governments through the course of the last decade, it still remains a constraining factor to overall growth prospects. In FY20, the two biggest markets in the region, Brazil and Mexico, represented 64% of LATAM market in size and witnessed a growth of 9%. The region also includes exports from India. We have now expanded our presence into Chile, Peru and Colombia by signing distribution agreements with key players in these markets.

Mexico Mexico is one of the world’s largest pharmaceutical markets, with a size of US$ 7.5 Billion. The market witnessed robust growth of 8% in FY20, albeit affected by currency devaluation due to macroeconomic headwinds. Laboratorios Grin (Lab Grin), Lupin’s subsidiary in Mexico, recorded a growth of 3.6% in secondary sales and continues to be ranked 2nd in the ophthalmic reference market (by units). In FY20, we launched important products like hyaluronic acid in preservative free presentations. This launch further strengthened our presence in the dry eye segment. Lab Grin’s portfolio consists of 50 ophthalmic products and 10 primary care products. We intend to now leverage our global product pipeline and grow in areas beyond the ophthalmic segment by launching products in the respiratory, pain management and CNS segments. We are committed to transforming Lab Grin’s portfolio to one that is balanced with innovative and branded generics . products, across therapy areas.

Brazil The Brazilian pharmaceutical subsidiary, now ranks 14th in value significant headwinds in terms of market is US$ 14.9 Billion and is and is the 5th largest in terms of lower footfall in clinics, increase in the most important volumes (in reference market), input and logistic costs, specific pharmaceutical market in commanding a 2.1% market share. supply shortages and unfavourable LATAM, accounting for about During the year, MedQuimica forex rates, we continue to believe 42% of the region’s sales. It is launched 10 new generic and in the potential of Brazil as a ranked as the 13th largest dermatology products. growth market for the pharma pharmaceutical market MedQuimica outpaced industry industry. Our strategy to leverage worldwide. In FY20, the Brazilian growth, delivering 28.1% and our global pipeline assets in the pharmaceutical market 14.2% growth in value and CNS, Ophthalmology and recovered with a growth rate of volumes respectively, per IQVIA. Respiratory segments and build approximately 10% largely led by Leveraging our strong innovation capabilities in both robust volume growth. However, manufacturing platform and Specialty and OTC, will pay price pressures coupled with efficient commercial structure, we dividends from the region in the higher input costs weighed on are aligned to emerge stronger in years to come. profitability. the quarters to come. Whilst in MedQuimica, Lupin’s Brazilian the short term there are Data Source: IQVIA MAT Dec 2019 & March 2020

20 Corporate Overview Statutory Reports Financial Statements Building Rank Asia Pacific (APAC) th th Markets Served in Largest Generic Largest Branded the Region Company in Generic Company 10 4 Australia 5 in Philippines

The APAC region accounts for more than 20% of the global pharmaceutical market with an estimated market size of US$ 230 Billion. Lupin is present in the major markets of Japan, Australia and Philippines in the region, and the region accounts for 4% of our global sales. In FY20, we recorded a growth of 8.4% in the region, while the market grew at 6%.

Japan The pharmaceutical market of significant headwinds for growth, partnership with Nichi-Iko for Japan is pegged at US$ 79 Billion. and led us to exit our on-shore biosimilar Etanercept, which The market has significantly presence in the market in FY20. was successfully launched in evolved since we entered in 2007. Japan in H2 FY20. We will Kyowa Pharmaceutical Industry Co. We remain interested in the Japanese market. Lupin continue to selectively bring Ltd, acquired in 2007 was our main our portfolio of complex subsidiary in Japan. Its acquired continues to supply its existing generics and rare diseases to Kyowa Criti Care focused on the products, APIs and select new injectables business. We believe products in Japan through a the Japanese market, that Japan’s intense licensing agreement with Kyowa partnering with the right cost-containment regulations with Pharmaceutical Industry Co. Ltd. partners to maximize value for regular price cuts present We are also committed to our the company.

2007 2007 - 2019 Entered Japan market via Developed robust business in Kyowa Pharmaceutical Industry Co. complex generics; acquisition launched biosimilar Etanercept

Divested Japan assets to Divestment generated post-tax net cash flows of neo ALA Co. Ltd. and JPY 33,328 Million leading to a net debt to equity ratio Unison Capital’s entity Plutus Ltd. improvement from 0.32 (Q2 FY20) to 0.08 (Q3 FY20)

2019 2019

Australia The Australian pharmaceutical As we move ahead, we plan to and diabetes segments. We rank market is valued at US$ 11.7 introduce our complex injectable 5th among branded generic Billion with a growth rate of 6.8% and respiratory products to the companies in the country. in FY20. The generics segment in Australian market, in addition to Multicare generated total Australia has witnessed select niche products with revenues of PHP 1,760 Million, consolidation in recent times and limited competition. recording a growth of 13% grew at a faster rate of 13.2%, compared with the previous year. backed by government support. The Philippines The Philippines pharmaceutical Our strategy for the region Lupin’s Australian subsidiary, focuses on increasing our market Generic Health ranks 4th in the market is valued at US$ 4.4 Billion, and grew by 8.3% in FY20. share by launching a mix of region amongst generic players in-house and in-licensed and supplies generic prescriptions Multicare Pharmaceuticals products. The in-house and OTC medicines to pharmacies Philippines Inc. (Multicare), Lupin’s inhalation and injectable pipeline and hospitals in Australia. subsidiary in the country, is a is expected to be launched in the Generic Health reported a strong premium branded generics Philippines in the near future. FY20, with revenues of company with a strong presence in AUD 48 Million. the rheumatology, gastrointestinal Data Source: IQVIA MAT March 2020

Lupin Limited | Annual Report 2019–20 12321 Bringing new Solutions Europe, Middle East and Africa (EMEA) th of Global in South Africa Sales NaMuscla (Generics) 8% Roll-out on Track 4

The Europe, Middle East and Africa (EMEA) region accounts for 26% of the global pharmaceutical market with an estimated market size of US$ 292 Billion. Lupin is present in the major markets of U.K., Germany and South Africa, with the region contributing 8% to the company’s global sales. The region offers significant business in Europe registered a promotion of our key products opportunity to Lupin for further growth of 13% with sales of including Oxycodone, growth in the complex generics INR 6,414 Million. The key Sumatriptan Pen and segment, especially with our contributors to growth include NaMuscla®. In the U.K., we unique range of long-acting the portfolio expansion of launched Valproate Hormosan Pharma, our German Semisodium and several ARVs. injectables, biosimilars and ® inhalation products. In addition to subsidiary, new product Negotiations for NaMuscla ® reimbursement remain on track, our diverse generics portfolio, launches and scaling NaMuscla paving our growth path in Lupin has entered the Specialty across U.K., Germany and France. existing markets while we segment with the neurology ® continue exploring partnerships orphan drug NaMuscla . The restructuring of our sales to expand reach beyond the ® NaMuscla is our proprietary and marketing strategy in EU5 markets. product prescribed for the Germany along with our cost symptomatic treatment of optimization measures and myotonia in adults with implementation of centralized non-dystrophic myotonic (NDM) finance shared services, disorders, a severely debilitating delivered cost savings which FY21 is poised to be a neuromuscular condition. We plan further boosted the bottomline milestone year as we for the region. to comprehensively address prepare to launch our first Europe and the Middle East with During the year, Hormosan inhalation product (generic this product before taking it to entered into a partnership with Fostair® MDI), our first other geographies. Eli Lilly to promote their migraine product Emgality®, biosimilar (Etanercept), and Europe further strengthening continue the expansion of Hormosan’s position as a NaMuscla® The pharmaceutical market in market leader in the cluster Europe is valued at headache and migraine US$ 267 Billion. In FY20, Lupin’s segment. We also increased

22 Corporate Overview Statutory Reports Financial Statements

South Africa The pharmaceutical market in constrained by the minimal COVID-19, especially the South Africa is valued at price increase approved by EfferFlu product range. US$ 3.6 Billion. While the the government. Our growth in FY21 will be market grew by 1% YoY, Lupin’s driven by our strong market South African subsidiary, Despite these hurdles, Pharma rd position, a robust portfolio in Pharma Dynamics, registered a Dynamics was the 3 fastest the CVS space, and launch of growth of 4.9% with sales of growing pharma company new products. In addition, we ZAR 1,219 Million driven by overall and the fastest growing target to expand our product continued strength in key company in the OTC segment in offering in the OTC, Self-Help pharma segments, including South Africa. The company also (CAMS) category and also enter CVS and CNS. In FY20, Pharma maintained its leadership in the the medical cannabidiol market Dynamics achieved CVS space, led by key brands with a complimentary Broad-Based Black Economic including Amloc (Amlodipine), (non-scheduled) product. Empowerment (BBBEE) Fedaloc (Nifedipine) and Bilocor (Bisoprolol). The compliance. This ensures the In the backdrop of the COVID-19 complementary medicines continued access for our pandemic, we have revisited our franchise and OTC segment was products and puts us in a commercial approach and augmented by cough and cold preferred status. focused on de-risking our brands, further fuelled by supply chain. We have built While the new regulatory body, contingencies into our new South African Health Products product launches, focused on Regulatory Authority (SAHPRA) Rank 1 by volume in CVS leveraging digital to market our works towards strengthening its products and connect with presence, we anticipate some customers, while accelerating delays in product approvals. In Rank 2 by volume in CNS & our pace towards digital addition, the benchmark-pricing Hospital IV transformation. band structures being used by medical aid funding agencies 3rd fastest growing pharma have been driving prices down. company in region Growth rate during the year was Data Source: IQVIA MAT March 2020

Lupin Limited | Annual Report 2019–20 23 The Backbone Active Pharmaceutical Ingredients (API)

Market Share Billion Share of 398 in TB Segment FY20 Lupin 46% ` 13 Turnover 9% Revenue in FY20

Lupin’s API business contributes to both captive consumption as well as external sales across 70 countries. For FY20, it constituted 9% of consolidated revenues driven from six manufacturing sites at Tarapur, Ankleshwar, Dabhasa, Mandideep, Indore and Visakhapatnam. In addition to sale of API, the business is forward integrated into the Principal to Principal (P2P) business which aims to provide access to new molecules for first-to-market opportunities in developing countries and the Global Institutional Business (GIB) which partners with governments and organizations to help eradicate diseases like Tuberculosis (TB), HIV and Malaria. In addition to a very strong marketed product portfolio, we have a valuable development pipeline of new products across select therapy areas of interest.

24 Corporate Overview Statutory Reports Financial Statements

fermentation technology required molecules and combinations to manufacture products like attuned to market needs. In In FY20, each of our key Rifampicin, which forms the line with this, we are APIs exceeded revenues backbone for treating TB. strengthening our gastroenterology portfolio of INR 1.5 Billion and is a Opportunity landscape category leader with unique combination in ARV drugs for the management of dyspepsia, while in the Our antiretroviral (ARV) cardiac segment we are The battle against portfolio is comprehensive and strengthening our product Tuberculosis has evolved in line with current range with complex extended treatment guidelines. With a release formulations for the Lupin has always been at the comprehensive development management of heart failure. forefront of the global fight pipeline, meaningful filings and against TB and we are the select approvals to date, we are largest supplier of first-line geared to address the ARV Share of API revenues anti-TB drugs in the world. Our segment, with an overall market API plants operate in size of US$ 1.8 Billion. Exports India compliance with all applicable 64% 36% standards, including WHO GMP, Facilitating access to the and our products are newest molecules prequalifed by WHO, signifying high quality standards. We are Our P2P business leverages our the largest supply partners to rich expertise in API research governments of high TB burden and formulation development. countries across Africa and The business entails launching Asia, including India. several first-to-market products in India and other developing We are strengthening our geographies, providing partners anti-TB portfolio with the with a strong and reliable development of key products product supply. recommended for the treatment of multi-drug resistant (MDR) Our P2P product pipeline is TB. Our expertise in focused on developing new Data Source: IQVIA MAT March 2020

Lupin Limited | Annual Report 2019–20 25 The Catalyst Research and Development

With 7 R&D centers employing over 1,500 personnel, Lupin has pursued a single goal in all its research endeavors – bringing affordable, quality medicines to market that address unmet patient needs. Our Research and Development efforts are primed to utilize the best technologies, superior competencies and strategic partnerships, helping us do truly global cutting-edge work.

26 Corporate Overview Statutory Reports Financial Statements

430 272 R&D Spend 43 14 Cumulative ANDA `15,538 First-to-Files Exclusive ANDA Filings Approvals Million First-to-Files

Generic API and finished Highlights FY20 product research We continue to invest ahead of Filed 21 ANDAs* comprising oral, injectable, ophthalmic, the curve to advance our inhalation and dermatology dosage forms and 2 NDAs global Generic R&D pipeline with significant investments in ANDA filings for the year include 2 confirmed exclusive First-to-File (FTF) and 6 shared FTF products complex generic platform technologies. The guiding principles are appropriate Received approval for 14 ANDAs from U.S. FDA; launched capital allocation, productivity 18 products in the U.S. market and profitability improvement. Our Generic R&D pipeline is Filed 11 generic products in other advanced markets aimed at developing a including EMEA (Europe, South Africa and Russia), APAC comprehensive portfolio of (Japan and Australia), LATAM (Mexico and Brazil) and high entry barrier products in Canada; received 10 approvals in these geographies the inhalation, injectable, ophthalmic and oral space with Filed 2 Marketing Authorization Approvals (MAA) for anti-TB complexities linked with API, and antiretroviral institution sale products, including one delivery systems, device design PEPFAR filing or clinical trial requirements.

* Includes 2 external filing through partner organizations

Lupin Limited | Annual Report 2019–20 27 Biosimiliar research FY20 saw significant to Enbrel®. In addition, a global developments on our biosimilar phase 3 clinical study in patients Etanercept front with its launch with moderate-to-severe active Ongoing developments in Japan in partnership with rheumatoid arthritis confirmed include: Yoshindo and Nichi-Iko. In June equivalence of Nepexto® to Enbrel® Successfully 2020, the European in terms of efficacy, safety and Pegfilgrastim: Commission (EC) granted immunogenicity. The centralized conducted U.S. FDA-centric marketing authorization for our marketing authorization applies to clinical studies and achieved biosimilar Etanercept (branded all member countries of the positive results as Nepexto®), for all indications European Union. This milestone reflects the strong scientific Ranibizumab: Phase 3 clinical of the reference product ® (Enbrel®). The regulatory program behind Nepexto and study ongoing in India and approval follows the adoption commitment by our team and our global clinical trial initiated of a positive opinion by the partner, Mylan, to commercialize Committee for Medicinal the product as soon as possible. Aflibercept: Received grant of Products for Human Use Our biosimilar pipeline is a rich US$ 6.5 Million under the (CHMP) in March 2020, which portfolio of diverse products at National Biopharma Scheme of was based on a biosimilarity various stages of development, the Department assessment including preclinical with the potential for us to be of Biotechnology, Government and clinical studies there in the first wave of of India demonstrating bioequivalence biosimilar launch.

Novel Drug Discovery & Development (NDDD)

Our NDDD team has developed a pipeline of highly AbbVie/MALT1 Boehringer Ingelheim (BI)/ differentiated and innovative Partnership (FY19) MEK Partnership (FY20) New Chemical Entities in focused therapy areas of Oncology, Immunology and Metabolic Disorders. During AbbVie licensed Lupin’s BI licensed Lupin’s MEK the year, we successfully MALT1 (Mucosa-Associated inhibitor compound for partnered with Boehringer Lymphoid Tissue Lymphoma clinical development in Translocation Protein 1) Ingelheim to advance our combination with its KRAS Inhibitor Program inhibitor pipeline clinical stage MEK inhibitor LNP3794 for the treatment of Lupin received US$ 30 Million Lupin received US$ 20 Million upfront + milestone payments difficult-to-treat cancers. upfront + milestone payments up to US$ 947 Million and more than US$ 700 Million royalty on sales and royalty on sales

28 Corporate Overview Statutory Reports Financial Statements

Bioclinical research Lupin Bioresearch Centre (LBC) conducts both in-vivo and Inhalation Research Center, Coral Springs in-vitro bioequivalence studies Lupin’s Inhalation Research Center at Coral Springs, Florida, is a as part of regulatory dossier specialized R&D facility focused on research and development of submission for regulatory inhalation products for the treatment of asthma, chronic agencies across the globe. LBC obstructive pulmonary diseases and other respiratory ailments. has managed 74 studies in FY20 and established Highlights FY20 cumulatively over 300 validated analytical methods to date. Generic Fostair®: Successfully completed pivotal PK study; MAA submitted to U.K. MHRA Intellectual Property Management Group (IPMG) Generic Spiriva®: Targeting approval in FY21 Lupin was First-to-File in FY20 Generic Dulera®: ANDA submitted to the U.S. FDA with respect to generic versions of Juluca® Tablets, Entresto® Generic ProAir®: Successfully addressed all regulatory queries in ® Tablets, Rexulti Tablets, line with recent U.S. FDA guidance Odefsey® Tablets, Descovy® ® Tablets, Vemlidy Tablets, and Generics of Qvar® and Ellipta® franchise: Developed Bridion® Intravenous Solution, functioning prototypes of generic Redihaler® and Ellipta® with the cumulative FTF products pending launch now devices with Lupin owned IP standing at 43. We settled 8 pending U.S. patent litigations and received a favorable U.K. court decision in the Truvada® SPC challenge. We secured a total of 65 patents in FY20.

Complex injectables platform, Nanomi Nanomi, Lupin’s Netherlands subsidiary, has unique capabilities in the field of microspheres and nanoparticle manufacture for the development of long-acting injectables. Nanomi’s expertise relies on its proprietary Microsieve technology. Post a successful meeting with the U.S. FDA, Nanomi is now set to embark on a clinical program for its lead Long Acting Injectable asset.

In FY20, we made significant progress in the development of complex generic formulations, in progressing our biosimilars pipeline and in our new drug development portfolio. This ongoing delivery from our R&D is a critical part of our strategy to bring to market a strong pipeline of complex products that bolster our revenues.

Lupin Limited | Annual Report 2019–20 29 Building Greatness Global Manufacturing & Supply Chain With a manufacturing footprint of 15 sites spread across India, United States, Brazil and Mexico, Lupin’s technical operations are its powerhouse to globally deliver high quality and affordable products.

In FY20, we continued our includes a Prefilled Syringe (PFS) filling thrust on expanding capacities line, Vial filling line and Lyophilizers and automation to support under aseptic isolators. growth in existing businesses Project work for the multi-fold and commercialization of our expansion of our Biotech Drug pipeline of complex generics Substance facility at Pune is ongoing to support the future demand and and biotechnology products. pipeline of our biosimilars, We enhanced existing including Etanercept. capacities significantly and created capacities for several new areas: The high-potency product manufacturing block at Indore Unit I that was commissioned at the end of FY19 for commercial production of products such as Levothyroxine, has been stabilized in the current fiscal. Another facility for high potency products is under commissioning. We completed the construction of the Pyrazinamide API block in our Vizag facility. Our state-of-the-art plant for Metered Dose Inhalers (MDI) in Indore Unit III is now nearing completion.Commercial production has commenced in this Unit for other products this fiscal. Project work on our new hi-tech facility for Oral Solid Dose (OSD) formulations and a dedicated sterile facility for injectables in our Nagpur SEZ facility was completed. Commercial production commenced from the OSD facility at the beginning of the year. The sterile injectable facility is equipped with the latest technologies involved in injectable manufacturing and

30 Corporate Overview Statutory Reports Financial Statements

Supply Chain The supply chain function at Lupin has been built on a framework of agility, business continuity, service standards and optimizing on inventory carrying costs. The model has always been found to be robust with accolades from multiple channel partners. We carry out periodic 'supply risk assessments' to absorb supply shocks. This was especially put to test in the COVID-19 outbreak and related lockdown in India and other parts of the world, which impacted distribution networks across the country as well as the availability of key raw materials. Through the resilience built into our supply chain and concerted and collaborative efforts with supply partners, the team ensured continuity of production and supply of our products.

Highlights FY20

Built a future-ready procurement First blockchain initiative Maintained an industry leading operations engine through the implemented to build OTIF (On-Time In-Full) centralized Shared Services transparency with Contract score of 95% + for all function leading to automated Manufacturing Operations (CMO) procurement categories procurement operations

Site highlights

MANDIDEEP INDORE ANKLESHWAR Installed roof top solar power Carried out multiple Future Ready Factory of the panels (capacity 500 KW) as infrastructure upgrades such Year Platinum Award received an alternate source as installation of from Frost & Sullivan of power. These will generate aerodynamically designed annualized savings cooling tower fans and Par-Excellence Award of INR 3.4 Million automatic tube cleaning received from Quality Circle system for chillers Forum of India – HQ for Installation of Emulsification Installation of Sotax AT70 Cefadroxil Yield unit to improve steam fuel Automated Smart Dissolution Improvement ratio by 2.3% will give in the QC laboratory and substantial savings annually installation of automated Gold Award received from canister actuation system American Society of Quality (NOVI) for MDI products (ASQ) for Cefadroxil Yield Improvement

TARAPUR GOA Centralized Data Acquisition Implemented Centralized Ankleshwar System implemented for real Data Acquisition System time data capture in and 200 KW solar power manufacturing operations to project for clean, reduce human errors renewable energy Quality Control (QC) lab Engineering team was the improvement implemented 2nd runner up in the CII All leading to transcription error Goa Kaizen Competition reduction; ‘5S’ project helped in reduction of lab incidents Received the Government of Maharashtra Health Department award NAGPUR Won the prestigious Engineering News Record Global Best Project Award of AURANGABAD Merit in the Manufacturing New, state-of-the-art category. The award was building constructed for given to Lupin’s Oral Solid Quality Control and Sterile Injectable units at Nagpur

Lupin Limited | Annual Report 2019–20 31 Pune Operational Excellence Awards Received the International Sustainability Rating System (ISRS 8th edition) certification for Mandideep, Tarapur, Ankleshwar and Dabhasa sites. The first three sites achieved a rating of 7 which is the highest score Sikkim Indore in the pharmaceutical sector globally

Received award for Best Operational Excellence in Manufacturing at the India Pharma Awards for the third time in last four years

Nagpur

Vizag

32 Corporate Overview Statutory Reports Financial Statements Putting Quality First Quality and Compliance Our unwavering commitment to sustainable Quality and Compliance remains deeply rooted in our core values and is a part of our Quality First commitment. Lupin’s continued engagement through global benchmarking and collaboration with regulatory bodies, industry working groups and subject matter experts continues to shape our Quality Governance Model.

Putting Quality First is not only and Compliance, a seasoned best-in-class in both our a mandate coming from the leader with significant Manufacturing and Quality outcome of regulatory experience in global quality operations. These include inspections but also a strategic operations and compliance in electronic Batch Production decision to examine and revamp the generics, branded and Records, Laboratory Information API segments. our core manufacturing Management System and a operations so that they are in In an effort to minimize errors Quality Assurance Management line with our aspirations. With arising out of manual System. We recognize that we this in mind, we initiated the interventions, we have embraced also have to continuously upskill Global Quality Action Plan technology and automation (GQAP), an integrated plan our team and have completely across all our sites. In FY20, we overhauled our training program and a roadmap driving global have introduced several for technical personnel. Measures standardization under a single automated processes like quality system across Lupin’s advanced robotic equipment for like Gemba Walkthroughs manufacturing entities. preparing analytical samples at instituted across our We have further strengthened our Indore site. There are several manufacturing facilities ensure our Quality and Compliance other enterprise-wide systems continuous assessment and team by bringing in being implemented that will true ownership of our sites by Johnny Mikell as head of Quality bring Lupin to being our team.

Quality outcomes The effectiveness of our Quality remediation measures can be seen in the outcomes of recent inspections conducted by the U.S. FDA and other regulatory agencies, across our sites. We place the highest priority on the safety, efficacy and reliability of our products, the safety of our patients, and towards maintaining the highest data quality.

Recent inspection history

Indore (Unit I, II, III) Nagpur Vizag GMP certificate EIR received from the EIR received from the received from U.K. MHRA U.S. FDA in April 2020 U.S. FDA in May 2020 in May 2020

EIR received from the EIR received from the EIR received from the U.S. FDA in March 2020 U.S. FDA in April 2020 U.S. FDA in April 2020 Lupin’s Inhalation Aurangabad Indore (Unit I) Research Center, Florida

Lupin Limited | Annual Report 2019–20 33 Leading Compliance Environment, Health and Safety

As a leading pharmaceutical player supplying medicines to over 100 countries across the globe, our sites are certified by all relevant regulatory bodies. Through our Environment, Health and Safety measures we ensure that our procedures and practices in manufacturing our products meet the highest international benchmarks. We continue to upgrade and invest in infrastructure to create a greener footprint of our operations whilst investing in our employees’ health and safety through training, process overhauls and technology deployment.

Energy consumption and Water conservation management

In FY20, our consumption of energy from Our total water consumption for FY20 was both renewable and non-renewable sources 2,648,232 KL, including both fresh and was 2,981,239 GJ. Of the total energy used in recovered water. Of this, over 30% is our manufacturing plants and R&D center, recovered water. The primary source of the 10.3% comes from renewable sources. We have also started switching over from freshwater is municipal/industrial bodies furnace oil to cleaner fuel for several of our and this is further supplemented by facilities. To further reduce dependency on groundwater and surface water. fossil fuels, we have installed solar power panels at almost all our facilities.

Steps taken to reduce Steps taken to reduce freshwater energy consumption consumption

2,175 GJ energy was saved by replacing Steam condensate recovery and reuse in conventional sodium vapour and the boiler fluorescent lights by LED lights at five of About 68% of the wastewater generated in our API sites our plants is recycled and reused directly for Replacement of pumps and motors with utilities, flushing, etc. after recovery high efficiency models Rainwater and AHU condensate to the tune Installation of variable frequency drives of 7,740 KL was collected and used in place of freshwater Installation of motion sensors in offices and warehouses to optimize energy utilization

Roof-top solar panels at Aurangabad site Wastewater recovery plant at Nagpur site

34 Corporate Overview Statutory Reports Financial Statements

Wastewater Waste management and Greenhouse management recycling emission At Lupin, we continuously All hazardous and non- We have used the Emission improve our wastewater hazardous wastes generated Factors of Central Electricity management and output. We from our facilities are Authority (CEA), 2018, India and have installed wastewater segregated, recovered, recycled United States Environmental treatment plants and water and disposed as per their Protection Agency (USEPA), recovery plants consisting of individual characteristics, in 2020, Greenhouse Gas state-of-the-art reverse osmosis compliance with all regulations. Inventories for the estimation of units (RO), multiple-effect In FY20, our plants generated direct and indirect emissions evaporators (MEEs) and agitated biodegradable wastes from scope 1 (71,967 tCO2) and thin film dryers (ATFD) to recover amounting to 3,942 MT which scope 2 (325,562 tCO2) energy water from the wastewater. was either sent to piggeries or use. We have reduced 7,490 composted to convert it into tCO2e by using solar and usable organic fertilizer. wind power. Employee health & safety

We have implemented one of the leading safety and Navigating COVID-19 sustainability management systems, International Environment, Health and Safety are at the center of all Sustainability Rating System decision-making in our response to the COVID-19 pandemic. (ISRS) at four of our major API Lupin ensured that its sites and employees could continue sites (Tarapur, Ankleshwar, work without disruption by implementing numerous Dabhasa and Mandideep). ISRS procedures and protocols such as regular deep sanitization of is a comprehensive safety and premises and employee transport/buses sustainability rating system which rates 15 management We have implemented measures to ensure social distancing is processes in a continuous practiced across shop floors, QC laboratories and canteens improvement loop. During the Robust screening procedures are in place and all employees last audit, three of our sites are mandatorily screened were rated at level 7 and one site was rated level 6 on a We have implemented Self-declaration through a daily health 10-point scale. Lupin is proud to monitoring app to track employee health be the only pharmaceutical Employees, contractors and visitors are provided masks and company in the world to sanitizers regularly achieve a rating of 7, the Mock drills are carried out at each facility to prepare for highest ISRS rating achieved any emergency and check the efficacy of our COVID-19 for any pharmaceutical response protocols company globally.

Like any responsible corporate entity, Lupin is committed towards the goals of sustainable growth, employee health and safety along with shareholder value creation. Our measurement on various environmental parameters has matured over the years and will enable us to gauge our performance even better.

Lupin Limited | Annual Report 2019–20 35 A Strong Core Financial Review The current year saw us making several notable strides on the Finance front that set us on a stronger footing for the future – stronger capital return ratios, lower balance sheet leverage and lowered effective tax rates. With regards to Business performance, we closed the year with solid growth across key markets and a strong compliance record across facilities in recent audits. In light of the COVID-19 crisis, the last quarter tested our leadership, endurance and adaptation skills, and I am delighted to share that we excelled in the way we responded.

Financial highlights Ramesh Swaminathan Recorded consolidated sales (from continuing operations) Executive Director, Global CFO and of INR 151,428 Million in FY20 compared to INR 143,181 Head Corporate Affairs Million in FY19; a growth of 5.8% Earnings before Interest, Tax, Depreciation and Amortization (EBITDA) from continuing operations was INR 28,386 Million; 18.7% of sales Profit before Tax (PBT) before Exceptional items (from continuing operations) was INR 15,054 Million; 9.9% of sales Exceptional items for the year amounted to INR 7,521 Million and included: Profit on divestment of Japan operations of INR 12,164 Million Impairment of intangibles of INR 15,893 Million Settlement with State of Texas of INR 3,792 Million Profit before Tax and after Exceptional items (from continuing operations) was INR 7,533 Million

Net Profit before Exceptional items (from continuing operations) was INR 9,088 Million in FY20 as compared to INR 8,521 Million in FY19; growth of 6.7% Net Debt as on March 31, 2020 stands at INR 15,118 Million as compared to INR 52,438 Million as on March 31, 2019 Net Debt-Equity for the company stands at 0.12:1 on March 31, 2020 as compared to 0.38:1 as on March 31, 2019

The Board recommended a Dividend of 300% for FY20 Current ratio in FY20 stood at 1.7 compared to 2.3 in FY19 due to increase in the current portion of long term debt by US$ 267 Million relating to the Gavis acquisition Interest coverage ratio in FY20 stood at 5.5 compared to 7.8 in FY19 due to increase in reported finance costs on implementation of IND-AS 116 (Leases) in FY20

Research and Development

R&D investment (from continuing and differentiated products is and received tentative U.S. FDA operations) for FY20 was paying off. approval for gBrovana. We have INR 15,538 Million, 10.3% of We made solid progress on several now filed five major inhalation revenue versus 10.5% in FY19. The key products during the year – we products in the developed accent on cost optimization and received European approval for markets, with collective sales of productivity improvement Nepexto®, a biosimilar to Enbrel® almost US$ 6 Billion (IQVIA MAT without impacting product (Etanercept). We advanced our Mar 2020). We are committed to delivery of our pipeline of inhalation pipeline with the filing bringing gProAir® to the U.S. complex generics, biosimilars of another MDI with the U.S. FDA, market shortly.

36 Corporate Overview Statutory Reports Financial Statements

Cost optimization Capital allocation and balance sheet strengthening With the changing dynamics of In FY20, we divested our Japanese subsidiaries Kyowa CritiCare the generics market, we believe Co., Ltd. (KCC) and Kyowa Pharmaceutical Industry Co., Ltd. that cost optimization and (Kyowa). The net proceeds were utilized to pare long-term debt prudent capital allocation will by ~US$ 300 Million. This divesture coupled with debt repayment is expected to improve our return on capital employed by ~72 bps. continue to be a key business imperative. We aim to continue We also recognized a non-cash impairment of US$ 225 Million creating a leaner and more (INR 15,893 Million) as a result of erosion in the value of our Gavis efficient organization. In FY20, acquisition. Erosion in the value of pipeline products and we made significant strides in increased competition on existing products were key reasons for our cost optimization initiatives the impairment. encompassing value engineering, procurement efficiencies and R&D productivity. However, input Capital expenditure 11,705 price rises on other molecules 11,705 and sales mix changes eroded We continue to invest in upgradation of our existing 8,990 visibility of the same, to some 8,990 manufacturing facilities to aid

measure. These initiatives have 6,200 5,710 however created a strong efficiencies as well as build 5,710 foundation and our cost capacities to meet future demand. We have signficiant optimization momentum will enhancements of our Biosimilar continue with increased and Inhalation facilities rigor in FY21. underway. We invested

INR 5,710 Million toward capex CAPEX ` in Million requirements during the year. FY17 FY19 FY18 FY20 Internal control systems & Information Technology

We continue to invest in engage with doctors. remotely manage continuity and automation of business Infrastructure harmonization and carry on business. processes and operations in heightened emphasis on A strong internal audit order to improve efficiencies, information security have been drive down costs and for driving framework is key to ensuring focus areas. Our newly created compliance. Our audit framework business. Automation of Finance Shared Service Center processes including Laboratory monitors and controls all aided by Robotic Process systems and processes and Information Management, Batch Automation supports markets Process Records, Document business groups ensuring Management, Acquisition & around the globe, ushering in compliance to financial norms Consolidation of shop floor greater efficiencies and savings. and procedures, building financial data, and HR processes have The robustness of these control and accountability within made signficant progress and initiatives is being tested in the our business ecosystem. We are are being scaled across the COVID-19 crisis, but I am happy ably assisted by Ernst & Young (EY) company. Our medical to share that we have come out and PricewaterhouseCoopers representatives are equipped with flying colours to date, (PwC) who support our with the best digital tools to having crafted agile solutions to Internal Audit function.

Risk, concerns and threats We witnessed huge volatility in reporting and forecasting systems compliance ethic to manage commodity prices and foreign has helped us ensure business competitive, economic, currencies towards the end of continuity at this time. financial, geopolitical and the fiscal year due to the In addition, our deep customer social risks. COVID-19 outbreak. This was relationships coupled with agile We are conscious of the further accelerated by a supply chain helped us in ensuring high service levels across markets. headwinds being faced by the stringent lockdown in China, a industry. However, we see the key source of raw material and Our forex strategy for the short, emergence of an improved intermediates for the mid and the long-term through business environment, Pharmaceutical industry, leading appropriate forecasting and especially in the second half of to a significant supply chain hedging tools helped minimize FY21 and are confident that the disruption. Our investment in forex volatility. We rely on risk measures taken by us in recent building a global supply chain management and forecasting times would help us to come leveraging business intelligence, frameworks and a strong out stronger than ever.

Lupin Limited | Annual Report 2019–20 37 The Spirit of Lupin Human Resources

Great Place to Work™ Certified Company Innovation, transformation and continuous improvement are the bedrock of all great companies. These traits are the pillars of our people philosophy and help us build our functional capabilities to embrace technology and best-in-class practices, allowing us to create greater value for the organization and our stakeholders. This also enables us to attract the best talent, develop skills, enhance roles and shape careers that contribute to the fulfilment of Lupin’s vision. All this goes into accolades such as being recognized as a Great Place to Work™, a ‘Gold Standard’ in workplace culture assessment and recognition.

38 Corporate Overview Statutory Reports Financial Statements

Dr. Desh Bandhu Gupta Spirit of Lupin Award 2019 Winners

Ashes Chowdhury Bosco Martins Vikas Dhavle Ana Ribeiro

Ben Ellis Pritesh Upadhyay Elis Cook Jenny Shah

New HR model nine-month learning journey for pandemic, we designed and In FY20, we migrated to a new our senior leadership participants executed on a blueprint for site Human Resources (HR) model to self-assess, learn and develop and office operations teams, comprising Business Partners themselves with support from working collaboratively with (HRBPs) and Centre of Expertise top-notch faculty, coaches and our functions such as Manufacturing, (CoE). The new model allows HR business leaders. The debut of the Environment Health and Safety, to collaborate with our program saw 35 leaders undergo a R&D, our India Fieldforce and IT businesses on aspects such as five-day classroom training in to ensure last mile connectivity strategy design and execution, Naples, Florida. for each employee and providing workforce planning, talent them support through the crisis. management and organization Corporate Values We launched LIBERATE, a development. The CoEs in turn, awards medical helpline for our continuously update and After receiving an overwhelming employees to address their improve our core HR processes. concerns around COVID-19 response from 1800 nominees In line with this transformation, symptoms and queries. We also across the globe, we were doubled the medical and life we introduced EmployeeKonnect, delighted to announce the first an integrated and globally insurance coverage for all our recipients of the Dr. Desh Bandhu employees to provide relief deployed digital platform to Gupta Spirit of Lupin Awards. ensure seamless availability of during this time of The DBG Spirit of Lupin Awards unprecedented stress. During the employee data across different recognize those employees lockdown, we have offered services and systems. amongst us, who embody Lupin’s multiple learning programs in Additionally, we launched an core values and are role models. order to upskill employees and automated Recruitment support their mental well-being. Management Module COVID-19 response Close to 200 online programs which streamlines our with over 15,000 enrollments recruitment lifecycle. HR has played a critical role in ensuring business continuity have been conducted. Leadership development through the COVID-19 disruption We are committed to doing all by ensuring the health and safety that is needed to ensure the The fiscal also witnessed the of our employees. Even as safety and well-being of our launch of our Senior Leadership corporates were grappling to employees during these Development Program, an intense come to terms with the uncertain times.

Lupin Limited | Annual Report 2019–20 39 Serving Communities Everywhere Corporate Social Obligation 9 23 45 46 States Districts Villages

The Lupin Human Welfare and Research Foundation (LHWRF) works towards creating holistic and sustainable growth for rural communities across India. Our programs are of meaningful scale and are focused around economic development, social development, natural resource management, and infrastructure development.

40 Corporate Overview Statutory Reports Financial Statements

Economic development Infrastructure development

Rural development has been at LHWRF has been assisting development of rural infrastructure the core of LHWRF’s efforts since through measures such as strengthening of civic infrastructure in rural its inception in 1988. LHWRF schools, sanitation and low-cost housing. These initiatives have undertakes economic upliftment improved the quality of life of rural communities multi-fold. activities in the areas of agriculture, animal husbandry COVID-19 and rising and rural industrialization, with to the occasion special emphasis on enhancing Families farm productivity and income. LHWRF has carried out addressed This is primarily done through unparalleled work during the measures like crop unprecedented COVID-19 crisis. Economic diversification, introducing The Foundation provided timely development 47,990 technology interventions in support to affected communities, agriculture, breed improvement assisting transiting migrants and in farm animals, and support for Social quarantined people. From development 594,863 commercial dairies and fisheries. coordinating with district administration and authorities, Natural distributing food packets to Social development Resource migrants, organizing food camps and grain distribution centers, to Management 76,827 LHWRF’s social development programs are focused on distributing masks and sanitizers for frontline workers and Infrastructure women empowerment, development 9,556 community health management, officials, the Foundation stood in education and skill training via support of all those affected creation of self-help groups for by the pandemic. women, organizing health camps, and efforts aimed at increasing student retention in rural schools. Natural Resource Management (NRM)

Through the natural resource management interventions, the Foundation aims to insulate rural communities from the impact of droughts and uncertain weather-related issues. Efforts are aimed at increasing water access and land productivity.

Lupin Limited | Annual Report 2019–20 41 BoardBoard ofof DirectorsDirectors

Mrs. Manju D. Gupta Dr. Kamal K. Sharma Chairman Vice Chairman Committee Membership: CSR Committee Committee Memberships: Audit Committee, CSR Committee and Risk Management Committee

Ms. Vinita Gupta Mr. Nilesh D. Gupta Mr. Ramesh Swaminathan Chief Executive Officer Managing Director Executive Director, Committee Memberships: CSR Committee Committee Memberships: CSR Committee, Global CFO and and Risk Management Committee Stakeholders' Relationship Committee and Head Corporate Affairs Risk Management Committee

4242 CorporateCorporate OverviewOverview StatutoryStatutory ReportsReports FinancialFinancial StatementsStatements

Mr. Dileep C. Choksi Dr. K. U. Mada Mr. R. A. Shah Independent Director Independent Director Independent Director Committee Memberships: Audit Committee Memberships: Audit Committee Membership: Nomination Committee, CSR Committee and Committee, Nomination & & Remuneration Committee Stakeholders' Relationship Committee Remuneration Committee and Stakeholders' Relationship Committee

Mr. Jean-Luc Belingard Mr. Richard Zahn Ms. Christine Mundkur Independent Director Independent Director Independent Director Committee Membership: Nomination & Remuneration Committee

LupinLupin LimitedLimited || AnnualAnnual ReportReport 2019–202019-20 4343 Awards & Recognitions

Ranked No. 1 in the Biotech and Pharma list and amongst Top 50 large organizations by Great Place to WorkTM for 2019-20

Recognized for Operational Excellence in Manufacturing at the India Pharma Award 2019

Lupin’s Ankleshwar Facility Won the Gold Award from the American Society for Quality

Won the BEST Award 2019 from Association of Talent Development

Recognized as India Pharma Leader Award at the India Pharma 2020 and India Medical Device 2020 Conference organized by FICCI and the Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, Government of India

Won Award from Quality Circle Forum of India at 33rd National Convention on Quality Concepts at IIT BHU, Varanasi

3 sites rated 7 by ISRS (International Sustainability Rating System), the highest score in the pharmaceutical sector globally

Excellence in Corporate Social Responsibility at the India Pharma Award 2019

Lupin Foundation won the Corporate Citizen Award 2019 from the Indian Drug Manufacturers’ Association

44 Corporate Overview Statutory Reports Financial Statements Corporate Information

DIRECTORS COMPANY SECRETARY Mrs. Manju D. Gupta, Chairman Mr. R. V. Satam Dr. Kamal K. Sharma, Vice Chairman Ms. Vinita Gupta, Chief Executive Officer AUDITORS Mr. Nilesh D. Gupta, Managing Director B S R & Co. LLP Mr. Ramesh Swaminathan, Executive Director, Global CFO Chartered Accountants & Head Corporate Affairs Mr. R. A. Shah, Independent Director AUDIT COMMITTEE Mr. Richard Zahn, Independent Director Dr. K. U. Mada, Chairman Dr. K. U. Mada, Independent Director Dr. Kamal K. Sharma Mr. Dileep C. Choksi, Independent Director Mr. Dileep C. Choksi Mr. Jean-Luc Belingard, Independent Director Ms. Christine Mundkur, Independent Director NOMINATION AND REMUNERATION LEADERSHIP TEAM COMMITTEE Ms. Vinita Gupta, Chief Executive Officer Dr. K. U. Mada, Chairman Mr. Nilesh D. Gupta, Managing Director Mr. R. A. Shah Mr. Ramesh Swaminathan, Executive Director, Global CFO Mr. Richard Zahn & Head Corporate Affairs President - Novel Drug Discovery & Development Dr. Rajender Kamboj, STAKEHOLDERS’ RELATIONSHIP Mr. Naresh Gupta, President - API Plus & Global TB COMMITTEE Mr. Rajeev Sibal, President - India Region Formulations Mr. Dileep C. Choksi, Chairman Dr. Cyrus Karkaria, President - Biotechnology Mr. Nilesh D. Gupta Mr. Sunil Makharia, President - Finance Dr. K. U. Mada Mr. Debabrata Chakravorty, President - Global Sourcing & Contract Manufacturing President - Global Human Resources Mr. Yashwant Mahadik, CORPORATE SOCIAL RESPONSIBILITY Mr. Rajendra Chunodkar, President - Manufacturing Operations COMMITTEE Mr. Alok Sonig, CEO - US Generics, Head Global R&D and Biosimilars Mrs. Manju D. Gupta, Chairman Dr. Sofia Mumtaz, Head - Pipeline Management and Legal Dr. Kamal K. Sharma Mr. Thierry Volle, President - Europe, Middle-East & Africa Ms. Vinita Gupta Dr. Fabrice Egros, President - LATAM and Asia Pacific Mr. Nilesh D. Gupta Mr. J. Alan Butcher, Chief Corporate Development Officer Mr. Dileep C. Choksi Mr. Jon Stelzmiller, President - US Specialty Mr. Johnny Mikell, President - Global Head of Quality RISK MANAGEMENT COMMITTEE Dr. Kamal K. Sharma, Chairman REGISTERED OFFICE Ms. Vinita Gupta Mr. Nilesh D. Gupta 3rd Floor, Kalpataru Inspire, Off Western Express Highway, Mr. Sunil Makharia Santacruz (East), Mumbai - 400 055, India. + 91 22 6640 2323 www.lupin.com | [email protected] KEY CONTACTS Mr. Arvind Bothra, CORPORATE IDENTITY NUMBER Head - Investor Relations & Corporate Communications L24100MH1983PLC029442 [email protected]

REGISTRAR AND SHARE TRANSFER AGENT Mr. R. V. Satam Link Intime India Pvt. Ltd., [email protected] Unit: Lupin Limited, C 101, 247 Park, LBS Marg, Vikhroli (West), Mumbai - 400 083, India. +91 22 4918 6270 | Toll Free 1800 1020 878 [email protected]

Lupin Limited | Annual Report 2019–20 45 Ten Year Financial Summary

CONSOLIDATED BALANCE SHEET (` in million) As at March 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 SOURCES OF FUNDS Shareholders' funds Equity Share Capital 892.4 893.3 895.1 896.8 899.0 901.2 903.2 904.2 905.0 906.0 Reserves & Surplus 31,918.4 39,235.6 51,146.7 68,418.9 90,833.3 110,732.5 134,072.5 134,866.4 136,517.3 124,461.0 32,810.8 40,128.9 52,041.8 69,315.7 91,732.3 111,633.7 134,975.7 135,770.6 137,422.3 125,367.0 Non-Controlling Interest 515.1 722.9 594.5 669.4 241.0 320.8 345.2 400.8 468.6 444.6 Loans 11,623.9 16,391.0 11,644.9 6,537.4 5,371.2 71,775.2 79,660.9 71,428.0 84,961.5 63,053.2 Deferred Tax Liabilities (net) 1,791.8 1,910.1 2,336.8 2,486.6 1,527.5 3,266.8 3,948.5 2,855.3 2,882.8 1,995.4 Other Liabilities (incl. Provisions) 14,502.0 20,669.3 22,520.6 23,051.2 33,737.7 39,252.1 47,142.5 52,599.1 53,758.5 58,978.3 TOTAL 61,243.6 79,822.2 89,138.6 102,060.3 132,609.7 226,248.6 266,072.8 263,053.8 279,493.7 249,838.5 APPLICATION OF FUNDS Fixed Assets Net Block 17,313.4 22,456.6 24,928.5 26,977.3 27,200.3 64,515.2 87,229.2 79,135.0 87,063.9 60,866.3 Capital Work-in-Progress (incl. 5,319.3 4,973.7 3,909.0 4,110.2 6,745.3 32,145.5 24,639.0 26,555.6 17,293.9 10,953.4 Capital Advances) 22,632.7 27,430.3 28,837.5 31,087.5 33,945.6 96,660.7 111,868.2 105,690.6 104,357.8 71,819.7 Goodwill on Consolidation 3,254.9 5,040.0 5,073.2 6,578.7 16,252.8 22,654.4 23,100.1 24,484.9 23,803.2 18,514.8 Investments 31.5 28.0 20.6 20.6 55.4 143.3 220.0 26 7.1 317.7 360.7 Deferred Tax Assets (net) 380.5 467.8 704.4 708.1 2,561.7 3,358.5 5,076.4 7,165.6 7,340.0 1,743.1 Other Assets Inventories 11,999.6 17,326.7 19,489.3 21,294.5 25,036.1 32,736.5 36,422.8 36,624.9 38,367.7 34,568.7 Receivables 12,556.4 17,800.1 21,869.9 24,641.0 26,475.2 45,487.6 43,073.4 51,922.1 51,498.0 54,459.3 Cash & Bank Balances 4,201.4 4,024.7 4,348.8 9,739.1 21,304.7 8,237.7 28,135.4 16,431.7 32,523.5 47,935.2 (refer note iii) Others 6,186.6 7,704.6 8,794.9 7,990.8 6,978.2 16,969.9 18,176.5 20,466.9 21,285.8 20,437.0 34,944.0 46,856.1 54,502.9 63,665.4 79,794.2 103,431.7 125,808.1 125,445.6 143,675.0 157,400.2 TOTAL 61,243.6 79,822.2 89,138.6 102,060.3 132,609.7 226,248.6 266,072.8 263,053.8 279,493.7 249,838.5

46 Corporate Overview Statutory Reports Financial Statements

CONSOLIDATED STATEMENT OF PROFIT AND LOSS (` in million) Year ended March 31, 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 INCOME Sales 57,421.7 70,017.2 95,235.3 111,671.2 126,932.2 137,578.7 171,198.0 155,598.4 143,180.5 151,428.0 Other Operating Income 1,121.5 1,232.1 1,796.7 1,999.3 1,703.0 4,976.7 3,745.3 2,443.1 3,465.1 2,319.6 Other Income 221.9 143.5 278.5 1,164.8 2,397.5 1,851.9 1,065.1 1,503.5 3,330.1 4,837.6 Total Revenue 58,765.1 71,392.8 97,310.5 114,835.3 131,032.7 144,407.3 176,008.4 159,545.0 149,975.7 158,585.2 EXPENSES Cost of Materials 22,379.3 26,039.0 35,485.0 38,173.8 41,570.4 43,325.7 50,014.3 52,744.0 49,460.9 54,306.0 Epoee eets Expese 7,675.6 9,695.3 12,666.2 14,646.5 17,473.4 21,416.2 28,495.2 28,647.1 27,701.7 29,868.4 aufacturi ad Other Expeses 16,709.9 21,067.9 26,181.9 30,822.3 33,395.5 40,960.0 51,502.4 45,175.3 43,875.8 46,025.2 Total Expenses 46,764.8 56,802.2 74,333.1 83,642.6 92,439.3 105,701.9 130,011.9 126,566.4 121,038.4 130,199.6 Profit before Interest, Depreciation 12,000.3 14,590.6 22,977.4 31,192.7 38,593.4 38,705.4 45,996.5 32,978.6 28,937.3 28,385.6 & Tax Finance Cost 344.8 354.7 409.5 266.5 98.1 594.7 1,525.3 2,043.5 3,024.9 3,629.8 Depreciation and Amortisation 1,711.8 2,275.2 3,321.9 2,609.7 4,347.0 4,871.3 9,122.3 10,858.7 8,460.5 9,702.2 rot efore Exceptioa tes ax 9,943.7 11,960.7 19,246.0 28,316.5 34,148.3 33,239.4 35,348.9 20,076.4 17,451.9 15,053.6 Exceptioa tes efer ote iv ------14,643.5 3,399.8 7,520.7 Profit before Tax 9,943.7 11,960.7 19,246.0 28,316.5 34,148.3 33,239.4 35,348.9 5,432.9 14,052.1 7,532.9 Curret ax 1,176.3 2,756.2 5,829.0 9,536.0 10,041.6 11,433.5 10,882.1 5,349.8 8,496.8 6,869.7 eferred ax (26.5) 329.4 12.6 85.5 (337.6) (840.1) (1,097.0) (2,465.2) 382.6 4,701.4 Net Profit/(Loss) before 8,793.9 8,875.1 13,404.4 18,695.0 24,444.3 22,646.0 25,563.8 2,548.3 5,172.7 (4,038.2) Discontinued Operations, Share of Profit from Jointly Controlled Entity, Non-Controlling Interest and Share of Loss in Associates rot fro iscotiued Operatios ------944.6 1,301.0 hare of rot fro oit - - - - - 49.0 82.5 35.2 3 7. 5 39.4 Controlled Entity hare of rotoss attriutae to 148.4 198.6 262.8 331.3 411.9 87.6 71.7 70.9 89.3 (3.9) Non-Controlling Interest hare of oss i Associates 20.0 ------Net Profit/(Loss) 8,625.5 8,676.5 13,141.6 18,363.7 24,032.4 22,607.4 25,574.6 2,512.6 6,065.5 (2,693.9)

Notes : i) Figures are suitably regrouped to make them comparable. ii) The company has transitioned the basis of accounting from Indian generally accepted accounting principles AA to d A ith effect fro Apri Accordi aace heet for oards ad tateet of rot ad oss for oards are as per d A iii) Cash and bank balances includes Current Investments and Non Convertible Debentures having maturity ore tha oths hich represets ivestets of surpus fuds iv Exceptioa ite for pertais to rotoss o divestet of susidiaries i apa oa haraceutica oa CritiCare pairet of itaie assets ad etteet ith the tate of exas Exceptioa ite for pertais to rovisio for e to Europea Coissio ad for pertais to Impairment of intangible assets.

Lupin Limited | Annual Report 2019-20 47 Directors’ Report

To the Members Your Directors have pleasure in presenting their report on business and operations of your Company for the year eded arch Financial Results (` in million) Standalone Consolidated 2019-20 2018-19 2019-20 2018-19 Revenue from Operations 110256.6 113563.2 153747.6 146645.6 Other Income 4751.9 2913.4 4837.6 3330.1 rot efore iterest depreciatio ad tax 23828.0 31441.2 28385.6 28937.3 ess iace Costs 525.9 354.7 3629.8 3024.9 ess epreciatio ad aortisatio 5187.5 4263.0 9702.2 8460.5 Profit before share of Profit from Jointly Controlled Entity, 18114.6 26823.5 15053.6 17451.9 exceptional items and Tax Add hare of rot fro oit Cotroed Etit - - 39.4 3 7. 5 ess Exceptioa tes 7592.1 3399.8 7520.7 3399.8 ess rovisio for taxatio icudi deferred tax 324 7.0 8035.4 11571.1 8879.4 Profit/(Loss) after tax from continuing operations 7275.5 15388.3 (3998.8) 5210.2 Profit/(Loss) after tax from discontinued operations - - 1301.0 944.6 Profit/(Loss) after tax and before non-controlling interest 7275.5 15388.3 (2697.8) 6154.8 hare of rotossattriutae to ocotroi terest - - (3.9) 89.3 Net Profit/(Loss) attributable to Shareholders of the Company 7275.5 15388.3 (2693.9) 6065.5

Performance Review the vaues iied the eoved Chaira ate Consolidated Revenue from Operations for the Dr. Desh Bandhu Gupta and his uncompromising ear eded arch as ` iio commitment to continue work and ensure that despite hiher over the previous ear teratioa challenges, life-saving medicines manufactured by usiess cotriuted Cosoidated prot efore the Company are available across the world. With a exceptioa ites ad tax as ` iio view to facilitate the upkeep of good health for its Exceptioa ites pertai to ipairet of ` epoees across dia the Copa exteded a iio reated to certai acuired s prot of medical outreach program - L I B E R A T E (Lupin’s ` iio o divestet of the Copas Initiative to Bri Covid Education & provide etire stae i oa haraceutica dustr Co Recommendations for Advocacy, testing & Treatment iited apa setteet aout of ` assistance to Employees) for those who wished to iio i respect of tate of exas asuit i the seek medical assistance during lockdown. USA and loss of ` iio o divestet of The Company’s Global Giving Program directed its the Copas etire stae i oa CritiCare Co reief efforts toards itiati the CO crisis iited apa Exceptioa ites for the ear eded its ht aaist CO the Copas C ar arch pertaied to provisio for e to upi Hua efare ad esearch oudatio has Europea coissio et oss after exceptioa been at the forefront for providing relief by supplying items was ` iio food, medicines, personal protective equipment COVID-19 Pandemic etc. to the underprivileged, and frontline warriors, Aidst the ooi CO padeic that across regions. Various initiatives were undertaken has gripped the world, your Directors appreciate to support the overburdened national and state the stupedous efforts of the upi fai i healthcare systems in India and elsewhere in the world ensuring health and safety of employees across the to suppeet the reief efforts to tace the ooi globe as also maintaining continuity of supply of CO crisis he Copa has exteded support ad much-needed products for communities and patients distributed essential commodities where the need is the Company serves. The Company put into practice the most.

48 Corporate Overview Statutory Reports Financial Statements

Dividend copiace ith the rst proviso to ectio With a view to compensate shareholders due to of the Copaies Act Act ad ues ad divided ecoi taxae effective Apri of the Copaies Accouts ues saiet our irectors recoeded hiher divided of features of the acia stateets perforace ad (` per euit share as aaist ` per acia positio of each susidiar ad oit veture equity share) of the previous year. The total dividend are ive i or o AOC as Annexure ‘A’ to amount is ` iio this Report. Financial statements of subsidiaries and ursuat to euatio A of the E joint venture are available for inspection by Members isti Oiatios ad iscosure euireets at the eistered Office of the Copa duri euatios isti euatios ivided business hours pursuant to the provisions of Section Distribution Policy has been hosted on the of the Act he Copa sha provide a cop of esite of the Copa upico e i the acia stateets of its susidiaries ad oit httpsupicopdfcorporatepoicies venture to Members free of cost upon their request. dividend-distribution-policy.pdf). hese acia stateets are aso avaiae o the Company’s website www.lupin.com. Share Capital During the year, the paid-up share capital of the ursuat to the provisios of euatio h Company rose by ` iio coseuet to the of the isti euatios poic for deterii aotet of euit shares of ` each material subsidiaries has been hosted on the to eligible employees of the Company and its Copas esite upico e i https susidiaries o exercisi optios uder various stoc upicopdfcorporatepoiciespoicfor option plans. Paid-up equity share capital as on determining-material-subsidiaries.pdf). arch as ` iio Management Discussion and Analysis Credit Rating As stipuated euatio read ith chedue CA iited CA assied the rati ‘ICRA A1+’ of the isti euatios aaeet (pronounced ‘ICRA A one Plus’) for the Company’s Discussion and Analysis forms part of this Annual short-term credit facilities of ` iio Report. indicating very strong degree of safety regarding Corporate Governance Report tie paet of acia oiatios our irectors reaffir their cotiued coitet Subsidiary Companies/Joint Venture to adhere to the highest standards of Corporate As o arch the Copa had overace As stipuated euatio subsidiaries and a joint venture. read ith chedue C of the isti euatios Corporate Governance Report forms part of this As part of streaii apaese operatios ad Aua eport Aexed to the said eport is the aligning with the vision to focus on key markets and strategic priorities to achieve sustainable growth, the Auditors certicate as prescried uder chedue E Copa divested its etire stae i oa Criticare of the isti euatios Co td apa ad oa haraceutica dustr Business Responsibility Report Co iited apa effective epteer ad As stipuated euatio f of the isti eceer respective Coseuet oth Regulations, the Business Responsibility Report forms entities ceased to be subsidiaries of the Company. part of this Annual Report. As part of itera restructuri o Octoer Corporate Social Responsibility (CSR) Nanomi B.V., Netherlands, wholly-owned subsidiary With a holistic approach, the Company’s CSR arm of the Copa as ered ith upi Hodis upi Hua efare ad esearch oudatio B.V., Netherlands, wholly-owned subsidiary of the H focuses o the four theatic areas Copa effective Apri ad its ae as Economic, Social, Infrastructure Development and changed to Nanomi B.V., Netherlands. atura esource aaeet H has As part of reoraisi usiess operatios upi a presece i viaes ocated i ocs hara C ussia ad ioix herapeutics C of districts spread across ie states i dia USA, wholly-owned subsidiaries of the Company, were t operates throuh cetres eveopi rura iuidated effective Apri ad eceer economy includes a family centered approach and respective initiation of actions to enable the upliftment of the poor. Other areas like disaster relief and mitigation he ae of upi etures c A as chaed were taken up with a view to attain sustainable to upi aaeet c A effective arch development.

LUPIN LIMITED | ANNUAL REPORT 2019-20 49 The Company broadly undertakes the following CSR iv) the aua acia stateets have ee activities prepared o a oi cocer asis

Ecooic eveopet v) the had aid do proper itera acia ocia eveopet controls and that the same are adequate and were ura ifrastructure eveopet operati effective ad atura esource aaeet vi) they had devised proper systems to ensure ear Ear rora ad compliance with the provisions of all applicable isaster eief ad itiatio laws and that such systems were adequate and ursuat to the provisios of ectio of the operati effective Act read with the Companies (Corporate Social Directors esposiiit oic ues duri the ear As recommended by the Nomination and the Company ought to have spent ` million on Remuneration Committee (NRC), the Board CSR activities. The actual spend was ` iio reappoited s iita upta Chief Executive espite est efforts the Copa has ee uae to Officer for a period of ve ears effective a execute its aitious pa of settiup a stateof suect to approva of the eers s iita theart C ad AH accredited hospita i uai is a epoee of upi aaeet c A as it could not identify a suitable plot. The Company wholly-owned subsidiary of the Company. aims to continuously increase its CSR spend and is costat expori e areasactivities particuar ursuat to the provisios of ectio of the Act deeper sustainable projects, to accelerate the spend. Mr. Nilesh Deshbandhu Gupta, Managing Director, uri the Copa i aso ae retires by rotation at the forthcoming Annual General C speds toards reief efforts for itiati the Meeting (AGM) and is eligible for re-appointment. CO padeic icudi cotriutio to the As recommended by the NRC, Mr. Ramesh CARES Fund. aiatha Executive irector oa CO Head Details of CSR activities undertaken by the Company Corporate Affairs as appoited as a Additioa are given in Annexure ‘B’ to this Report. The policy irector effective arch ursuat to the on CSR which has been approved by the Board and provisios of ectios ad of the Act the same has been hosted on the Company’s website r aesh hods office up to the date of the www.lupin.com. forthcoming AGM. Mr. Ramesh brings to the Company rich experiece of over ears additio to havi Directors’ Responsibility Statement worked with the Company for more than a decade copiace ith the provisios of ectio in his earlier stint, he has also worked with reputed c read ith ectio of the Act to the est organizations in diverse industry sectors such as VST of their oede ad eief our irectors cor dustries td C roup tadard Chartered a that Hee ad otices uder ectios ad i) i the preparatio of the aua acia of the Act have ee received fro certai stateets for the ear eded arch Members proposing his name for appointment as the applicable accounting standards have been Director. fooed ao ith proper expaatios reati At the th A hed o Auust to ateria departures r eauc eiard as appoited as a ii) they had selected such accounting policies and depedet irector to hod office ti the cocusio applied them consistently and made judgments of the th AGM. Pursuant to the provisions of and estimates that are reasonable and prudent ectios read ith chedue of the Act so as to give a true and fair view of the state of and Rules made thereunder and as recommended affairs of our Copa at the ed of the acia by the NRC, Mr. Belingard is being re-appointed as ear arch ad of the prot of our a depedet irector to hod office for a period Copa for that ear of ve ears after the cocusio of the th AGM ie fro Auust ti Auust iii) the have tae proper ad sufficiet care for the His appoitet is suect to approva the maintenance of adequate accounting records Members vide a Special Resolution at the ensuing in accordance with the provisions of the Act for AGM. Mr. Belingard has consented for being appointed safeguarding the assets of the Company and as a depedet irector ad has cored for preventing and detecting fraud and other that he is ot disuaied fro ei appoited as irreuarities a irector He has aso suitted decaratio as

50 Corporate Overview Statutory Reports Financial Statements

regards Independent status vis-à-vis the Company. oard deieratios here is o coict of iterest of otices uder ectios ad of the Act Independent Directors with the Company. have been received from certain Members proposing Audit Committee his name for appointment as Director. All Members of the Audit Committee viz. copiace ith the provisios of ectio r ada Chaira r ieep C Chosi ad of the Act ad euatio of the isti r aa hara are oExecutive irectors Regulations, all the Independent Directors have Dr. Mada and Mr. Choksi are Independent Directors. submitted declarations that they meet the criteria of All recommendations made by the Audit Committee idepedece as provided i ectio of the Act were accepted by the Board. The functions performed ad euatio of the isti euatios by the Audit Committee, particulars of meetings held respectively and that there has been no change in the and attendance of Members at the said meetings circustaces affecti their status as depedet are given in the Corporate Governance Report, which Directors of the Company. forms part of this Annual Report. During the year, eight Board meetings were held, Nomination and Remuneration Policy o a ue Auust The Board has on the recommendations of the NRC, Auust oveer oveer formulated a Policy relating to the remuneration eruar ad arch of Directors, key managerial personnel and other the details of which, are given in the Corporate epoees as stipuated ectio of the Governance Report which forms part of this Act ad euatio of the isti euatios Annual Report. The policy lays down the guiding principles, the philosophy and the basis for recommending payment Board Evaluation of reueratio to the executiveoexecutive ursuat to the provisios of ectio p of Directors (by way of sitting fees and commission). the Act ad ue of the Copaies Accouts t icudes criteria for deterii uaicatios ues a aua perforace evauatio as positive attributes and independence of directors and carried out by the Board of its own performance, other matters. The functions of the NRC are disclosed Directors individually and Committees of the in the Corporate Governance Report, which forms part Board. Performance evaluation of the Board and of the Annual Report. In terms of proviso to Section Committees was done by the Board after seeking of the Act the oiatio ad eueratio inputs from all Directors, inter-alia covering Policy has been hosted on the Company’s website differet criteria vi adeuac ad copositio of upico e i httpsupi the Board, quality of deliberations, transparency, copdfcorporatepoiciesoiatioad effectiveess of oard procedures oservace reueratiopoicapdf of governance and contributions of Directors at Board and Committee meetings. In evaluating the Related Party Transactions performance of individual Directors, criteria such as o trasactio ith reated parties coicted ith the eadership uaities uaicatios resposiiities interests of the Company. All transactions entered by shouldered, analytical skills, knowledge, participation the Copa ith reated parties duri the acia in long-term strategic planning, inter-personal year, were in the ordinary course of business and on relationships and attendance at meetings was taken an arm’s length pricing basis. The Audit Committee into consideration. In compliance with Regulation periodically approves related party transactions. of the isti euatios the oard Material related party transactions were entered into carried out performance evaluation of Independent by the Company only with its subsidiaries. Apart from Directors without the participation of the Director remuneration, sitting fees and commission, there is being evaluated. The performance evaluation was no pecuniary transaction with any Director, which carried out based on parameters such as, initiative, had potetia coicts of iterest ith the Copa contributions, independent judgement, understanding As approved by the Members vide Postal Ballot, the business environment and understanding r aa hara ice Chaira aso served of strategic issues. Independent Directors are as a Advisor fro Apri to epteer a diversied roup of recoised professioas articuars of his reueratio as Advisor are with wide horizon of knowledge, competence and given in Annexure ‘H’ to this Report. As stipulated by iterit ho express their opiios free ad ectio h of the Act read ith ue of exercise their o udeets i decisioai the Copaies Accouts ues discosure of Overseas Independent Directors have international particuars of cotractsarraeets etered ito perspectives and bring them to bear upon during the Company with related parties are given in Form No.

LUPIN LIMITED | ANNUAL REPORT 2019-20 51 AOC as Annexure ‘C’ to this Report. In compliance has ever since, maintained its rank every year it ith euatio of the isti euatios participated. Your Company was named in the Top the policy on dealing with related party transactions, copaies of dia he Copas peoperst as approved by the Board, has been hosted on the culture, best-in-class work environment and Company’s website www.lupin.com and web link for the innovative learning initiatives were the prime drivers sae is httpsupicopdfcorporatepoicies behind these laurels. policy-related-party-transactions.pdf. The Company has in place an Internal Complaints Risk Management Coittee as adated the exua Harasset The Company has a structured approach for of Women at Workplace (Prevention, Prohibition handling risks. It has in place a Risk Management ad edressa Act Aso the epoees are fraeor hich dees roes ad resposiiities regularly sensitized about matters connected with at differet eves is aaeet tea revies prevetio of sexua harasset the overa riss ad ideties the critica riss that Employees Stock Options matter’. The Risk Management Committee (RMC) ursuat to the provisios of euatio of the foruated i copiace ith euatio of the E hare ased Epoee eets euatios isti euatios revies at reuar itervas detais of stoc optios as o arch the overall risks at Company level and ensures that are given in Annexure ‘E’ to this Report. it has a robust monitoring mechanism along with adequate mitigation plans for the critical ‘risks that Vigil Mechanism/Whistleblower Policy matter’ based on their probability of occurrence, As stipuated ectio of the Act read ith potential impact and volatility. The emerging risks are ue of the Copaies eetis of oard ad its discussed periodically with the concerned operational oers ues ad euatio of the isti and business teams which includes review of the Regulations, the Company has in place a strong vigil itiatio pas he oard has deed roe ad mechanism for Directors and employees to report responsibilities of the RMC and has delegated to it, concerns and provides adequate safeguards against monitoring and reviewing the risk management plan. victimization of persons who use the said mechanism. Constitution of the RMC, its terms of reference, details Details of the same are covered in the Corporate of meeting held and attendance thereat are given in Governance Report which forms part of the Annual the Corporate Governance Report, which forms part of Report. Over the years, your Company established a the Annual Report. reputation for doing business with integrity and has displayed zero tolerance for any form of unethical Particulars of loans/guarantees/ conduct or behaviour. The vigil mechanism provides investments/securities direct access to the Chairperson of the Audit ursuat to the provisios of ectio of Committee. Whistleblower Policy has been hosted on the Act, particulars of loans, guarantees, investments Company’s website www.lupin.com. Policies on Code ad securities ive uder ectio of the Act are of Coduct ad revetio of exua Harasset are given in the notes to the Financial Statements forming on the internal portal of the Company. part of this Annual Report. Particulars of Employees Remuneration Conservation of Energy, Technology Particulars of remuneration of employees required to Absorption and Foreign Exchange Earnings be disclosed pursuant to the provisions of and Outgo ectio of the Act read ith ue Particulars pertaining to conservation of energy, of the Companies (Appointment and Remuneration techoo asorptio ad forei exchae earis of aaeria ersoe ues are ive ad outo as stipuated i ectio of the in Annexure ‘F’ to this Report. Particulars of Act read ith ue of the Copaies Accouts remuneration of employees for the year ended ues are ive i Annexure ‘D’ to this Report. arch reuired to e furished i ters of Human Resources ues ad of the said ues fors part of Your Company strongly believes that human resources this Report and shall be provided to Members upon are its invaluable assets. The Company has the written request pursuant to second proviso of Rule privilege of being recognised as ‘Great Place to Work’ articuars of reueratio of epoees are ad it has retaied its positio of ei the o available for inspection by Members at the Registered Copa i hara ad iotech dustr i office of the Copa duri usiess hours o a After securi nd ra i i the sae cateor working days up to the date of the forthcoming AGM, the Copa secured the top positio i ad pursuat to ectio of the Act

52 Corporate Overview Statutory Reports Financial Statements

Auditors approving the remuneration of Mr. Shenoy for the year At the th A hed o edesda Auust eded arch eers appoited Co Chartered The Company has duly maintained cost records as Accoutats ir e o specied the Cetra overet uder ectio as Statutory Auditors of the Company, for a period of the Act of ve ears fro the cocusio of the th AGM ti the cocusio of the th AGM to be held in copiace ith ectio of the Act read uAuust suect to raticatio of their ith ue of the Copaies Cost ecords ad appointment by Members at every AGM. Audit ues Cost Audit eport i or o CA ode for the ear eded arch he reuireet of seei raticatio of eers uder the head rus ad haraceuticas for continuance of appointment of Statutory Auditors as ed ith the Cetra overet o Octoer at every AGM was withdrawn by the Companies e ithi the prescried tie Aedet Act Secretarial Audit ursuat to the provisios of ectios ad ursuat to the provisios of ectio of the Act of the Act the Copa has received Certicate fro read ith ue of the Copaies Appoitet Co certifi that their appoitet and Remuneration of Managerial Personnel) Rules, would be as per the conditions prescribed by the said ad euatio A of the isti euatios Sections. Ms. Neena Bhatia, Practising Company Secretary (FCS Internal Audit o C o as appoited the oard Internal audit of Company’s operations is conducted of irectors at its eeti hed o a to by the Corporate Internal Audit team and other undertake Secretarial Audit of the Company for the reputed rs appoited fro tie to tie ear eded arch ecretaria Audit eport The Company also appointed local Chartered i prescried or o is ive i Annexures ‘G’ Accoutat rs to coduct audits of Carri and ‘G’-1 to this Report. The Company continues to Forwarding Agents and Central Warehouses of the have a uuaied ecretaria Audit eport Copa i dia tera audit dis are discussed Annual Secretarial Compliance Report at meetings of the Audit Committee and corrective ursuat to Circuar o CCC actions taken. dated eruar issued the ecurities Cost Audit ad Exchae oard of dia E s eea hatia ursuat to the provisios of ectio of the Act ractisi Copa ecretar C o C o read with the Companies (Cost Records and Audit) as appoited for issui Aua ecretaria Aedet ues ad as recoeded Copiace eport for the ear eded arch the Audit Committee, the Board of Directors at its he eport hich as paced at the oard eeti hed o a appoited r eeti hed o a cors that the heo ractisi Cost Accoutat CA o Company has maintained proper records as stipulated as Cost Auditor to conduct cost audit for the year under various Rules and Regulations and that, no eded arch r heo cored that action has been taken against the Company or its he as free fro disuaicatios as specied uder ateria susidiaries or prootersdirectors E ectio read ith ectios ad of the EE he said eport sha e ed ith toc Act hed a vaid certicate of practice ad that his Exchaes ithi stipuated tie appoitet et the reuireets of ectios In compliance with the said Circular, the Company ad of the Act He aso cored that he submitted the Annual Secretarial Compliance Report was independent and maintained an arm’s length for the ear eded arch to E ad E o relationship with the Company and that no orders a ithi the stipuated tie or proceedings were pending against him relating to professional matters of conduct before the Institute Compliance with Secretarial Standards of Cost Accoutats of dia or a courtcopetet The Company continues to comply with Secretarial authority. tadards o oard eetis ad eera eetis issued the stitute of Copa ters of ue of the Copaies Audit ad Secretaries of India. Auditors ues reueratio of the Cost Auditor is reuired to e ratied eers Extract of Annual Return Accordingly, an Ordinary Resolution was passed by As stipuated the provisios of ectios a the eers at the th A hed o Auust ad of the Act read ith ue of the

LUPIN LIMITED | ANNUAL REPORT 2019-20 53 Companies (Management and Administration) Rules, deep gratitude to various departments of the Central a extract of the Aua etur i or o and State governments, suppliers, distributors, banks, as o arch is provided as Annexure acia istitutios aasts usiess associates ‘H’ to this Report. The same is available on the medical professionals, customers and members. Copas esite upico e i https upicoivestorsextractoftheaua For and on behalf of the Board of Directors retur Manju D. Gupta Acknowledgements Chairperson Your Directors commend all employees of the Company for their dedication, commitment, hard work ad cotriutios he oard ishes to express their Mumbai, a

54 ANNEXURE ‘A’ TO THE DIRECTORS’ REPORT FORM NO. AOC - 1

[Pursuant to the first proviso to sub-section (3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014] Proposed% of share Profit/ holding Provision dividend TurnoverProfit/ (Loss) Statement containing salient features of the financial statement of subsidiaries/associateInvestments companies/jointfor ventures Total Total (Loss) after Reserves (Other than in taxation Share Assets Liabilities before taxation Part ‘A’ : Subsidiaries and subsidiaries) Reporting currency andCapital taxation Surplus exchange rate as on the (` in million) Reporting last date of the relevant Name of the Subsidiary Date since period for the financial year in the case of when subsidiary foreign subsidiaries subsidiary concerned, if [Refer Note 4 707. 5 61214.2 56506.7 Nil 55328.1 2641.8 1222.5 1419.3 Nil upi haraceuticas c A was30.06.2003 acquired/different N.A.from ad Exchae ate incorporated the holding INR 75.67 for 1 US $ Nos. 1 and company’s 14] reporting period

oa haraceutica dustr 18.10.2007 N.A. ad Exchae ate Nil Nil Nil Nil Nil 13667.4 (62.1) (105.0) 42.8 Nil Co iited apa up to for [Refer Note December 17, 2019) No. 2] Pharma Dynamics (Proprietary) 01.03.2008 N.A. A ad Exchae ate 0.5 1987.4 3087.0 1099.1 36.0 5820.6 1341.2 399.2 942.0 Nil iited outh Africa INR 4.23 for ZAR 1 Horosa hara H 25.07.2008 N.A. Euro ad Exchae ate 8.1 1002.1 2588.4 1578.2 Nil 2848.549.5 527.8 478.3 Nil Germany INR 82.77 for 1 Euro Multicare Pharmaceuticals 26.03.2009 N.A. H ad Exchae ate 26.9 865.8 2161.6 1268.9 Nil44.7 2428.3 51.7 (7.0) Nil Statutory Reports Statutory Corporate Overview Philippines, Inc., Philippines for H [Refer Note No. 7] eeric Heath t iited 27.09.2010 N.A. A ad Exchae ate is1344.3 (535.6) 1407.8 599.1 Nil 2314.9 164.5 Nil 164.5 Nil Australia INR 46.08 for 1 AUD oa CritiCare Co iited 30.11.2011 N.A. ad Exchae ate Nil Nil Nil Nil Nil 1687.5 11.2 (0.6) 11.8 Nil apa up to epteer for [Refer Note 2019) No. 8] L

UPIN upi Atatis Hodis A 05.06.2007 N.A. ad Exchae ate 115.9 42997.2 46811.9 3698.8 Nil 10178.3 8563.7[Refer Note 8563.7 Nil Switzerland INR 75.67 for 1 US $ No. 19] L upi Heathcare iited 05.06.2009 N.A. ad Exchae ate 279.7 (1047.8) 1380.5 2148.6 Nil 852.3 (385.4) Nil (385.4) Nil IMITED INR 93.50 for 1 GBP upi Austraia t iited 01.12.2004 N.A. A ad Exchae ate 33.3 (29.4) 19.2 15.3 Nil Nil (1.9) Nil (1.9) Nil

| A Australia INR 46.08 for 1 AUD upi hara Caada iited 18.06.2009 N.A. CA ad Exchae ate 155.5 2.1 1249.3 1091.7 Nil 1483.4 115.293.1 22.1 Nil NNUAL Canada INR 53.08 for 1 CAD upi exico A de C exico 23.08.2010 N.A. ad Exchae ate 52.2 (45.9) 6.3 [Refer Note Nil Nil (1.0) Nil (1.0) Nil for No. 15] R

EPORT eether hara t iited 27.09.2010 N.A. A ad Exchae ate 281.2 (289.4) Nil 8.2 Nil Nil Nil Nil Nil Nil Australia INR 46.08 for 1 AUD [Refer Note No. 9] 2019-20 upi hiippies c hiippies 20.12.2010 N.A. H ad Exchae ate 59.9 45.9 613.8 508.0 Nil 539.0 41.8 13.3 28.5 Nil Financial Statements for H upi Heathcare iited dia 17.03.2011 N.A. INR 26.2 58.7 85.9 1.0 85.2 Nil 2.6 1.0 1.6 Nil eeric Heath H 18.05.2011 N.A. ad Exchae ate 8.2 (7.0) 1.5 0.3 Nil Nil (0.8) Nil (0.8) Nil Malaysia INR 17.52 for RM 1 55 56

Proposed% of share Profit/ holding Provision dividend TurnoverProfit/ (Loss) Investments for Total Total (Loss) after Reserves (Other than in taxation Share Assets Liabilities before taxation and subsidiaries) Reporting currency andCapital taxation Surplus exchange rate as on the (` in million) Reporting last date of the relevant Name of the Subsidiary Date since period for the financial year in the case of when subsidiary foreign subsidiaries subsidiary concerned, if was acquired/different from incorporated the holding company’s reporting period

upi idde East C AE 13.06.2012 N.A. ad Exchae ate 32.3 (269.3) 4.6 241.6 Nil Nil (45.9) Nil (45.9) Nil INR 75.67 for 1 US $ upi c A efer ote 27.06.2013 N.A. ad Exchae ate 23369.6 (73468.6) 31055.0 81154.0 Nil 3406.7 (25626.6) 3272.7 (28899.3) Nil Nos. 3 and 22] INR 75.67 for 1 US $ upi H iterad 15.08.2013 N.A. ad Exchae ate 1.3 200.3 421.1 219.5Nil Nil 58.3 1 7.7 40.6 Nil INR 75.67 for 1 US $ Nanomi B.V., Netherlands 30.01.2014 N.A. ad Exchae ate 6720.3 32037.5 46477.6 7719.8 Nil 25573.0 2785.5 22787.5 Nil [Refer Note No. 6] INR 75.67 for 1 US $ aoratorios ri A de C 01.10.2014 N.A. ad Exchae ate854.2 598.8 2808.5 1355.5 Nil 2507.0 (106.0)(89.8) (16.2)Nil exico for Medquimica Industria 24.06.2015 N.A. ad Exchae ate 5055.8 (3651.6) 5146.2 3742.0 Nil 3047.1 (1120.7) (30.8) (1089.9) Nil araceutica A rai for [Refer Note No. 10] ove aoratories c A 08.03.2016 N.A. ad Exchae ate[Refer Note 5765.3 9255.6 3490.3 Nil 6841.6(509.8) (1103.6) (593.8) Nil INR 75.67 for 1 US $ No. 16] upi esearch c A 08.03.2016 N.A. ad Exchae ate[Refer Note 1134.1 2709.7 1575.6 Nil 320.5 2404.9 189.8 130.7 Nil INR 75.67 for 1 US $ No. 17] upi hara C ussia 11.02.2016 N.A. ad Exchae ate Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil [Refer Note No. 20] INR 0.95 for RUB 1 upi ata c A 15.12.2016 N.A. ad Exchae ate[Refer Note 21.4 109.4 88.1 Nil Nil 12.5 4.0 8.5 Nil INR 75.67 for 1 US $ No. 18] upi apa Asia acic 13.03.2017 N.A. ad Exchae ate 3.0 (17.3) 174.5 188.8 Nil Nil (3.0) 7.1 (10.1) Nil apa for upi etures c A 10.10.2017 N.A. ad Exchae ate Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil [Refer Note No. 11] INR 75.67 for 1 US $ ioix herapeutics C 10.10.2017 N.A. ad Exchae ate Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil USA [Refer Note No. 21] INR 75.67 for 1 US $ upi Europe H era 05.02.2018 N.A. Euro ad Exchae ate 2.0 28.6 51.9 21.3 Nil Nil (10.3) Nil (10.3) Nil INR 82.77 for 1 Euro

Notes: he shares i upi haraceuticas c A are hed upi c A ad upi iited O eceer the Copa copeted the divestiture of its etire stae i oa haraceutica dustr Co iited apa upi Atatis Hodis A iterad AHA hed Coo shares of upi c A O arch AHA sod to aoi etherads earier o as upi Hodis etherads its etire sharehodi i upi c A he etire sharehodis of hara aics t iited outh Africa upi c A Horosa hara H era eeric Heath t iited Austraia upi exico A de C exico upi hiippies c hiippies ad eeric Heath H aasia are hed aoi etherads he etire sharehodis of upi Heathcare iited upi hara Caada iited Caada upi idde East C AE upi H iterad aoratorios ri A de C exico upi ata c A upi apa Asia acic apa ad upi Europe H era are hed upi Atatis Hodis A iterad uri the ear aoi etherads hooed susidiar of upi Atatis Hodis A iterad as sod to upi Hodis etherads O Octoer aoi etherads as ered ith upi Hodis etherads effective Apri ad the ae of upi Hodis etherads as chaed to aoi etherads aoi etherads hods shares of uticare haraceuticas hiippies c hiippies O epteer the Copa copeted divestiture of its etire stae i oa CritiCare Co iited apa he etire sharehodi of eether hara t iited Austraia is hed eeric Heath t iited Austraia Effective eruar upi Atatis Hodis A iterad hods ad aoi etherads hods shares i eduiica dustria araceutica A rai Corporate Overview Statutory Reports Financial Statements

ae of upi etures c A as chaed to upi aaeet c A effective arch he etire sharehodis of ove aoratories c A upi esearch c A ad upi aaeet c A are hed upi c A upi exico A de C exico upi Heathcare iited dia eeric Heath H aasia upi Europe H era ad upi aaeet c A have ot et coeced coercia operatios upi haraceuticas c A has hare Capita of ie ` ota iaiities i upi exico A de C exico are ` ove aoratories c A has hare Capita of ie ` upi esearch c A has hare Capita of ie ` upi ata c A has hare Capita of ie ` upi Atatis Hodis A iterad has tax provisio of ` upi hara C ussia as iuidated o Apri ioix herapeutics C A as iuidated o eceer O arch upi c A issued preferred shares at par vaue ear ter to upi Atatis Hodis SA, Switzerland. 23) Figures in brackets denote negative amounts.

For and on behalf of the Board of Directors

Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam Chairperson Vice Chairman Chief Executive Managing Director Executive Director, Company Officer Global CFO & Head Secretary Corporate Affairs (ACS-11973)

Mumbai, May 28, 2020

Part ‘B’ Joint Ventures Statement pursuant to Section 129(3) of the Companies Act, 2013 related to Jointly Controlled Entity (` in million) Name of the Jointly Controlled Entity iooics iited apa 1) Latest Audited Balance Sheet Date March 31, 2020 2) Date on which Jointly Controlled Entity was acquired April 23, 2014 3) Shares of the Jointly Controlled Entity held by the Company on the year end *(Refer Note below) Number Coo hares of i Aout of ivestet i the oit Cotroed Etit 305.0 Extet of Hodi 4) Description of how there is significant influence N.A. 5) Reason why the Jointly Controlled Entity is not consolidated N.A. 6) Networth attributable to Shareholding as per latest audited Balance Sheet 305.0 7) Profit/Loss for the year (i) Considered in Consolidation (after inter company adjustment) 39.4 (ii) Not Considered in Consolidation 48.2 * Note: hares are hed upi Atatis Hodis A iterad hooed susidiar of the Copa

For and on behalf of the Board of Directors

Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam Chairperson Vice Chairman Chief Executive Managing Director Executive Director, Company Officer Global CFO & Head Secretary Corporate Affairs (ACS-11973)

Mumbai, May 28, 2020

LUPIN LIMITED | ANNUAL REPORT 2019-20 57 ANNEXURE ‘B’ TO THE DIRECTORS’ REPORT

ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES PURSUANT TO RULE 8 OF COMPANIES (CORPORATE SOCIAL RESPONSIBILITY POLICY) RULES, 2014. 1. A brief outline of the Company’s CSR policy, including overview of projects or programs proposed to be undertaken and reference to the web-link to the CSR Policy and projects or programs. he C oic ais at uidi ad repicati sustaiae evovi ad daic odes of socia ecooic ifrastructure and natural resource development at macro, micro and mini scales in partnership with government bodies and other stakeholders at national, regional, district, block and village level. rovidi services ad soutios to address socia issues ith hihest socia priorit for the poor ariaied ad uderprivieed i ie ith the usiess phiosoph of providi affordae medicines for most prevalent diseases. ai ad executi proras that oud eet the couities i ad aroud Copas orsites factor ad pat ocatios ad adoptedareas ith o Hua eveopet dices scores in order to enhance the quality of life of the community in general and the poor in particular. uidi urturi ad reiforci idetit of the Copa as a socia ad ethica resposie corporate etit throuh its C iitiatives for the eet of diverse staehoders i the societ Carri out activities that oud create icreased happiess ad epoeret of the staehoders Acti as a catast iterati diverse resources throuh direct itervetio ad socia ivestet to address the immediate needs of the poor as also long-term development concerns. espodi to atura ad athropoeic disasters caaities ad provide reief recostructio ad rehabilitation support. etti up deeper sustaiae istitutioa proects for oter efare of the atio

Web link: httpsupicopdfcorporatepoiciescorporatesociaresposiiitpoicpdf 2. Composition of the CSR Committee: i) Mrs. Manju D. Gupta - Chairperson ii) r aa hara iii) Ms. Vinita Gupta iv) Mr. Nilesh Deshbandhu Gupta v) Mr. Dileep C. Choksi 3. Average net profit of the Company for last three financial years: he averae et prot of the Copa for the ast three acia ears cacuated i accordace ith the provisios of ectio of the Copaies Act as ` iio 4. Prescribed CSR expenditure (two percent of the amount as in item 3 above): ` iio 5. Details of CSR spent during the financial year: (a) Total amount to be spent for the financial year: ` iio (b) Amount unspent, if any: ` iio

58 Corporate Overview Statutory Reports Financial Statements

(c) Manner in which the amount spent during the financial year is detailed below: (` in million) 1. 2. 3. 4. 5. 6. 7. 8. Sl. CSR project/activity Sector in which Projects/Programs Amount Amount Cumulative Amount spent: No. identified the Project is (1) Local area or other outlay spent on the expenditure Direct/through covered (2) Specify the State and (budget) projects/ up to the implementing District where projects/ project/ programs reporting agency programs were undertaken program- Sub-heads: period (From wise (1) Direct FY 2014-15) Expenditure on projects/ programs (2) Overheads 1. Rural Support Programme Social and Alwar, Bharatpur 150.0 154.5 681.7 H Economic (Rajasthan), Dhule, Pune, Development Sindhudurg (Maharashtra), Vidisha (Madhya Pradesh) 2. ear ad Ear Social and Dabhasa (Gujarat), Tarapur 23.7 18.3 76.0 H Programme Economic and Nagpur (Maharashtra), Development Goa and Sikkim 3. Rural Support Social and at ocatios 80.0 80.2 310.7 H Programme Economic Ankleshwar, Dabhasa Development (Gujarat), Aurangabad, Nagpur, Tarapur (Maharashtra), Pithampur, Mandideep (Madhya Pradesh), Vishakhapatnam (Andhra Pradesh), Goa, au ad ii 4. Tuberculosis Eradication Heath Mumbai 20.0 - 53.7 H 5. Patient Awareness Camps Heath atioa eve 20.0 19.6 87.6 Direct 6. Donations for CSR - atioa eve 60.0 54.1 187.4 Direct 7. Salary and Administrative - atioa eve 1 7.7 15.3 68.9 Direct Expeses Total: 371.4 342.0 1466.0

*LHWRF: Lupin Human Welfare & Research Foundation **MSGDJSN: Mata Shree Gomati Devi Jan Seva Nidhi 6. The aim of the Company is to continuously increase the amount of spend. The Company is looking for new areasactivities particuar deeper sustaiae proects to acceerate the sped uri the Copa i aso ae C speds toards reief efforts for itiati the CO padeic icudi contribution to the PM CARES Fund. 7. The implementation and monitoring of the CSR Policy is in compliance with the CSR objectives and Policy of the Company.

For and on behalf of the Board of Directors

Manju D. Gupta Nilesh Deshbandhu Gupta Chairperson Managing Director

Mumbai, May 28, 2020

LUPIN LIMITED | ANNUAL REPORT 2019-20 59 ANNEXURE ‘C’ TO THE DIRECTORS’ REPORT

FORM NO. AOC - 2 Disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in Section 188(1) of the Companies Act, 2013 including certain arm’s length transactions under third proviso thereto. [Pursuant to Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014] 1. A cotractsarraeetstrasactios etered ito the Copa ith reated parties duri the ear eded arch ere at ars eth asis

2. etais of ateria cotracts or arraeet or trasactios at ars eth asis

Sl. Name of the related party Nature of Duration of the contracts/ Salient Date(s) of approval by Amount paid as No. and nature of relationship contracts/ arrangements/ terms of the the Audit Committee/ advances arrangements/ transactions contracts or Board transactions arrangements or transactions including the value (` in million) 1. upi haraceuticas Sale of Goods Continuous Based on August 6, 2019, Nil Inc., USA, (wholly-owned Transfer Pricing August 7, 2019 subsidiary) Guidelines - November 5, 2019, ` 30756.4 November 6, 2019, February 5, 2020, February 6, 2020 and May 28, 2020 2. r aa hara Advisory Fees October 1, 2018 - In terms of August 6, 2019, Nil Vice Chairman office or pace September 30, 2019 Advisory August 7, 2019, of prot as Agreement - November 5, 2019 and approved by ` 22.9 November 6, 2019 Members (April 1, 2019 - September 30, 2019)

For and on behalf of the Board of Directors

Manju D. Gupta Chairperson

Mumbai, May 28, 2020

60 Corporate Overview Statutory Reports Financial Statements

ANNEXURE ‘D’ TO THE DIRECTORS’ REPORT Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo pursuant to the provisions of Section 134 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014.

(A) Conservation of energy: (i) steps taken or impact on conservation of energy; a) staed otio sesors for iht xtures b) staed us for copressed airportae ad puried ater c) epaced C ihts ith E oes d) Installed variable frequency drives on cooling water pumps. e) Trimmed Pump impeller at utility. f) staed eusicatio sste for effective uri of furace oi oier g) Replaced steam ejector with dry vacuum pump. h) Implemented close loop system in chilled water. i) Replaced screw air compressor with centrifugal ones. j) staed eer efficiet ear oxes ad otors k) Installed auto-control valves for steam utilization at furnace oil storage tank. l) staed HAC ad process euipets ith variae freuec drives m) epaced covetioa pups ith hih efficiec oes n) Installed condensing and pressurized economizers. (ii) steps taken for utilising alternate sources of energy; a) Installed solar panel. b) Installed heat pumps. c) Installed capacitor banks. d) Used wind power. e) staed pate heat exchaers for hot ater eeratio (iii) capital investment on energy conservation equipments; a) Nagpur - ` iio b) Ankleshwar - ` iio c) Goa - ` iio d) Mandideep - ` iio e) Pithampur - ` iio f) Aurangabad - ` iio g) Pune - ` iio (B) Technology absorption: (i) efforts made towards technology absorption; Particulars are given in the Management Discussion and Analysis which forms part of this Annual Report. (ii) benefits derived like product improvement, cost reduction, product development or import substitution; Particulars are given in the Management Discussion and Analysis which forms part of this Annual Report.

LUPIN LIMITED | ANNUAL REPORT 2019-20 61 (iii) in case of imported technology (imported during the last three years reckoned from the beginning of the financial year); (a) details of technology imported; o specic techoo as iported duri he Copa deveoped techoo throuh efforts of its ihouse esearch eveopet

(b) year of import; N.A.

(c) whether the technology been fully absorbed; N.A.

(d) If not fully absorbed, areas where absorption has not taken place, and the reasons, therefore. N.A. (iv)Foreign expenditure incurred on Research & Development (Consolidated):

a. Capital ` iio b. ecurri excudi depreciatio of ` iio ` iio Total: ` 15071.6 million

(C) Foreign exchange earnings and outgo: Foreign exchange earned in terms of actual inflows and foreign exchange outgo in terms of actual outflows during the year: -

orei Exchae eared i ters of actua ios ` iio orei Exchae outo i ters of actua outos ` iio

For and on behalf of the Board of Directors

Manju D. Gupta Chairperson

Mumbai, May 28, 2020

62 Corporate Overview Statutory Reports Financial Statements

ANNEXURE ‘E’ TO THE DIRECTORS’ REPORT iscosure evisaed i ters of euatio of ecurities ad Exchae oard of dia hare ased Epoee eets euatios the detais of diuted E o issue of shares pursuat to a the schees as o arch ere as uder

DESCRIPTION DETAILS Diluted earnings per share (EPS) (Consolidated) on issue iuted earis per share cosoidated as o ` 5.95) of shares pursuant to all the schemes covered under the o of Optios outstadi as o hares Regulations, calculated in accordance with Accounting Standard IND (AS) 33 ‘Earnings per share’. DETAILS OF STOCK OPTIONS AS ON MARCH 31, 2020 he discosure evisaed i ters of euatio C of ecurities ad Exchae oard of dia hare ased Epoee eets euatios the particuars of Epoee toc Optio chee EO as o arch ere as uder (i) A description of each Employee Stock Option Scheme (ESOS) existed during 01.04.2019 and 31.03.2020:

Sl. Name of the Plan Date of Total no. Vesting Exercise price or Maximum Source Variation No. shareholder’s of options Requirements pricing formula term of of shares In terms approval approved options of options granted 1. upi 05.12.2003 3957310 Options being Exercise rice is 10 years from Primary No Employees vested in phased the market price, the date of Variation Stock Option manner after or such other price grant Plan 2003 completion of as determined by (ESOP 2003) minimum one year the Nomination from the date of and Remuneration grant Committee 2. upi 28.07.2005 3211290 Options being Exercise rice is 10 years from Primary No Employees vested in phased the market price, the date of Variation Stock Option manner after or such other price grant Plan 2005 completion of as determined by (ESOP 2005) minimum one year the Nomination from the date of and Remuneration grant Committee 3. upi 10.05.2011 3600000 Options being Exercise rice is 10 years from Primary No Employees vested in phased the market price the date of Variation Stock Option manner after or such other price grant Plan 2011 completion of as determined by (ESOP 2011) minimum one year the Nomination from the date of and Remuneration grant Committee 4. upi 21.10.2014 2975000 Options being Exercise rice is 10 years from Primary No Employees vested in phased the face value, or the date of Variation Stock Option manner after such other price grant Plan 2014 completion of as determined by (ESOP 2014) minimum one year the Nomination from the date of and Remuneration grant Committee 5. upi 28.07.2005 802820 Options being Exercise rice is 10 years from Primary No Subsidiary vested in phased the market price, the date of Variation Companies manner after or such other price grant Employees completion of as determined by Stock Option minimum one year the Nomination Plan 2005 from the date of and Remuneration (SESOP 2005) grant Committee 6. upi 10.05.2011 900000 Options being Exercise rice is 10 years from Primary No Subsidiary vested in phased the face value, or the date of Variation Companies manner after such other price grant Employees completion of as determined by Stock Option minimum one year the Nomination Plan 2011 from the date of and Remuneration (SESOP 2011) grant Committee

LUPIN LIMITED | ANNUAL REPORT 2019-20 63 Sl. Name of the Plan Date of Total no. Vesting Exercise price or Maximum Source Variation No. shareholder’s of options Requirements pricing formula term of of shares In terms approval approved options of options granted 7. upi 21.10.2014 1525000 Options being Exercise rice is 10 years from Primary No Subsidiary vested in phased the face value, or the date of Variation Companies manner after such other price grant Employees completion of as determined by Stock Option minimum one year the Nomination Plan 2014 from the date of and Remuneration (SESOP 2014) grant Committee Note : One option is convertible into one equity share of the face value of ` each No. Description Details (ii) Method used to account for ESOS Fair Value method (iii) Where the Company opts for expensing of the options using the Not applicable intrinsic value of the options, the difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognized if it had used the fair value of the options shall be disclosed. The impact of this difference on profits and on EPS of the Company shall also be disclosed.

(iv) Option movement during the year (for each ESOS):

No. Particulars Details 1. Number of options outstanding at the beginning of the period Plan No. of options ESOP 2003 126850 ESOP 2005 35795 ESOP 2011 1317069 ESOP 2014 1377164 SESOP 2005 100568 SESOP 2011 645865 SESOP 2014 1079267 Total 4682578 2. Number of options granted during the year Plan No. of options ESOP 2011 40000 ESOP 2014 567338 SESOP 2011 66018 SESOP 2014 126280 Total 799636 3. uer of optios forfeietedapsed duri the ear apsed o accout of resiatio of epoees Plan No. of options ESOP 2003 11965 ESOP 2005 1250 ESOP 2011 58905 ESOP 2014 60020 SESOP 2005 568 SESOP 2011 66362 SESOP 2014 156289 Total 355359 4. Number of options vested during the year Plan No. of options ESOP 2011 24014 ESOP 2014 435390 SESOP 2011 46119 SESOP 2014 251655 Total 757178 5. uer of optios exercised duri the ear Plan No. of options ESOP 2003 8855 ESOP 2005 1500 ESOP 2011 50741 ESOP 2014 323579 SESOP 2005 100000 SESOP 2011 1225 SESOP 2014 18524 Total 504424

64 Corporate Overview Statutory Reports Financial Statements

No. Particulars Details 6. uer of shares arisi as a resut of exercise of optios Plan No. of shares ESOP 2003 8855 ESOP 2005 1500 ESOP 2011 50741 ESOP 2014 323579 SESOP 2005 100000 SESOP 2011 1225 SESOP 2014 18524 Total 504424 7. oe reaised exercise of optios `), if scheme is implemented Plan Amount (`) directly by the company ESOP 2003 2290962.15 ESOP 2005 556455.00 ESOP 2011 19027263.75 ESOP 2014 647158.00 SESOP 2005 37097000.00 SESOP 2011 2450.00 SESOP 2014 37048.00 Total 59658336.90 8. oa repaid the rust duri the ear fro exercise price received Not Applicable 9. Number of options outstanding at the end of the year Plan No. of options ESOP 2003 106030 ESOP 2005 33045 ESOP 2011 1247423 ESOP 2014 1560903 SESOP 2011 644296 SESOP 2014 1030734 Total 4622431 10. uer of optios exercisae at the ed of the ear Plan No. of options ESOP 2003 106030 ESOP 2005 33045 ESOP 2011 1137755 ESOP 2014 357842 SESOP 2011 489154 SESOP 2014 666086 Total 2789912 (v) Weighted average exercise prices and weighted average fair values of options eihted averae exercise prices ad eihted averae (i) eihted averae exercise price of optios rated fair values of options disclosed separately for options duri the ear hose hose exercise price either euas or exceeds or is ess tha a. Exercise price euas aret price A the market price of the stock b. Exercise price is reater tha aret price A c. Exercise price is ess tha the aret price ` 39.68 (ii) Weighted average fair value of options granted during the ear hose a. Exercise price euas aret price A b. Exercise price is reater tha aret price A c. Exercise price is ess tha the aret price ` 726.13 (vi) Employee-wise details of options granted to a. Senior Managerial Personnel (Chairman, Vice Chairman, Nil CEO and Managing Director) b. Epoees to ho optios rated aouti to i) r aeder ao as rated optios uder or more, of the total options granted during the year. EO he exercise price of the optios is ` 809.35. ii) r aeder ao as rated optios uder EO he exercise price of the optios is ` 701.25. iii) Dr. Fabrice Egros was granted 4900 options under SESOP he exercise price of the optios is ` 2.00. iv) Mr. Thierry Volle was granted 4900 options under SESOP he exercise price of the optios is ` 2.00. v) r oh ie as rated optios uder EO he exercise price of the optios is ` 2.00. vi) r aes utcher as rated optios uder EO he exercise price of the optios is ` 2.00. vii) Mr. Alok Sonig was granted 8000 options under SESOP he exercise price of the optios is ` 2.00. c. Epoees to ho optios eua to or exceedi of Nil the issued capital have been granted during the year.

LUPIN LIMITED | ANNUAL REPORT 2019-20 65 (vii) Description of the method and significant assumptions used during the year to estimate the fair value of the options, including the following information: air vaue cacuated usi acchoes optio prici ode hare price he cosi price o E as o the date of rat has ee cosidered for vaui the optios granted. Exercise rice Exercise rice is the face vaue of share or such other price as deteried the Nomination and Remuneration Committee. Expected oatiit he historica voatiit of the stoc ti the date of rat has ee cosidered to calculate the fair value of the options. Expected Optio ife Expected ife of optio is the period for hich the Copa expects the optios to be live. The minimum life of a stock option is the minimum period before which the options cannot be exercised ad the axiu ife is the period after hich the optios caot e exercised Expected divideds Expected divided ied has ee cacuated as a averae of divided ieds for four years preceding the date of the grant. isfree iterest rate he risfree iterest rate o the date of rat cosidered for the cacuatio is the iterest rate appicae for a aturit eua to the expected ife of the optios ased o the zero-coupon yield curve for Government Securities. Variables Weighted Average Information 1 2 3 4 5 6 7 8 Plan ESOP 2014 SESOP 2011 SESOP 2011 ESOP 2014 ESOP 2011 ESOP 2014 ESOP 2014 SESOP 2011 Grant date 12.04.19 27.05.19 31.07.19 31.07.19 04.10.19 06.11.19 04.12.19 04.12.19 is free rate 6.69 6.62 6.10 6.10 5.80 5.87 5.79 5.79 Expected ife ears 2.00 2.67 3.50 3.50 3.00 3.50 3.50 3.50 oatiit 7. 29 30.49 29.06 29.06 28.16 28.94 28.32 28.32 ivided ied 0.52 0.52 0.52 0.52 0.52 0.52 0.52 0.52 Stock price (NSE closing rate) ` 832.75 743.30 764.80 764.80 686.50 771.45 791.90 791.90 Option Fair Value ` 131.47 733.07 749.40 749.40 169.89 755.92 776.00 776.00

Variables Weighted Average Information 9 10 11 12 Plan SESOP 2014 ESOP 2014 SESOP 2011 SESOP 2014 Grant date 04.12.19 03.02.20 03.02.20 03.02.20 is free rate 5.57 6.02 6.02 5.79 Expected ife ears 2.67 3.50 3.50 2.67 oatiit 28.19 28.27 28.27 27.44 ivided ied 0.52 0.52 0.52 0.52 Stock price (NSE closing rate) ` 791.90 708.65 708.65 708.65 Option Fair Value ` 779.29 694.26 694.26 697.1 8

DETAILS OF STOCK APPRECIATION RIGHTS AS ON MARCH 31, 2020 he discosure evisaed i ters of euatio E of ecurities ad Exchae oard of dia hare ased Epoee eets euatios

(i) A description of each SAR Scheme existed during 01.04.2019 and 31.03.2020: o chee existed DETAILS RELATED TO TRUST AS ON MARCH 31, 2020 he discosure evisaed i ters of euatio of ecurities ad Exchae oard of dia hare ased Epoee eets euatios (i) General information of all schemes: o chee Existed (ii) Brief details of transactions in shares by the Trust: Not Applicable. (iii) In case of secondary acquisition of shares by the Trust: Not Applicable

For and on behalf of the Board of Directors

Manju D. Gupta Chairperson

Mumbai, May 28, 2020

66 Corporate Overview Statutory Reports Financial Statements

ANNEXURE ‘F’ TO THE DIRECTORS’ REPORT STATEMENT OF PARTICULARS AS PER RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL) RULES, 2014.

Sl. Name of the Director/Key Managerial Remuneration of % increase in the Ratio of the No. Personnel and Designation Director/Key remuneration in the remuneration Managerial Personnel year ended of each Director for the year ended March 31, 2020 to the median March 31, 2020 remuneration of the (` in million) employees 1. Mrs. Manju D. Gupta, 3.69 8 Chairperson 2. r aa hara 32.43 - 71 Vice Chairman 3. Ms. Vinita Gupta, 128.28 (Refer Note No. vi) 280 Chief Executive Officer 4. Mr. Nilesh Deshbandhu Gupta, 59.68 (Refer Note No. vi) 130 Managing Director 5. Mr. Ramesh Swaminathan, 0.79 N.A. 2 Executive Director, Global CFO & Head Corporate Affairs (w.e.f. March 26, 2020) 6. Mr. R. A. Shah, 3.76 8 Independent Director 7. r ada 3.46 8 Independent Director 8. Mr. Dileep C. Choksi, 3.32 7 Independent Director 9. Mr. Richard Zahn, 7.8 2 17 Independent Director 10. r eauc eiard 7.7 1 17 Independent Director 11. Ms. Christine Mundkur 7.75 N.A. 17 Independent Director (w.e.f. April 1, 2019) 12. Mr. Sunil Makharia, 32.55 N.A. 71 Interim Chief Financial Officer (from June 10, 2019 to March 25, 2020) 13. Mr. R. V. Satam, 8.41 - N.A. Company Secretary i) he edia reueratio of epoees of the Copa for the ear eded arch as ` million. ii) uri the ear eded arch there as a icrease of i the edia reueratio of employees. iii) uri the ear eded arch there as a averae icrease of i the saaries of epoees other than key managerial personnel. iv) As o arch the Copa had peraet epoees v) s iita upta is a epoee of upi aaeet c A hooed susidiar of the Copa vi) Ms. Vinita Gupta and Mr. Nilesh Deshbandhu Gupta opted out of receiving any remuneration for one-year period fro Auust to Auust hece aouts for the curret ear ad previous ear are not comparable. vii) e affir that the reueratio paid is as per the eueratio poic of the Copa

For and on behalf of the Board of Directors

Manju D. Gupta Chairperson

Mumbai, May 28, 2020

LUPIN LIMITED | ANNUAL REPORT 2019-20 67 ANNEXURE ‘G’ TO THE DIRECTORS’ REPORT FORM NO. MR - 3 SECRETARIAL AUDIT REPORT FOR THE YEAR ENDED MARCH 31, 2020 [Pursuant to the provisions of Section 204(1) of the Companies Act, 2013, Rule No. 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and Regulation 24A the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015]. To, The Members, Lupin Limited I have conducted Secretarial Audit of the compliance with applicable statutory provisions and adherence to ood corporate practices upi iited hereiafter caed the Copa ecretaria Audit as coducted i a aer that provided e a reasoae asis for evauati the corporate coductsstatutor copiaces ad expressi opiio thereo

ased o vericatio of the oos papers iutes oos fors ad returs ed ad other records aitaied the Copa as aso iforatio provided the Copa its officers aets ad authoried representatives during the conduct of Secretarial Audit, I hereby report that in my opinion, the Company has duri the audit period coveri the ear eded arch copied ith the statutor provisios isted hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extet i the aer ad suect to the reporti ade hereiafter have exaied the oos papers iutes oos fors ad returs ed ad other records aitaied the Copa for the ear eded arch accordi to the provisios of

1. he Copaies Act aedets thereto ad ues ade thereuder 2. he ecurities Cotracts euatio Act ad ues ade thereuder 3. he epositories Act ad euatios ad eas fraed thereuder 4. orei Exchae aaeet Act ad ues ad euatios ade thereuder to the extet of orei irect vestet as aeded fro tie to tie

5. he fooi euatios ad uideies prescried uder the ecurities ad Exchae oard of dia Act

a. he ecurities ad Exchae oard of dia ustatia Acuisitio of hares ad aeover euatios as aeded fro tie to tie

b. he ecurities ad Exchae oard of dia hare ased Epoee eets euatios as aeded fro tie to tie ad

c. he ecurities ad Exchae oard of dia rohiitio of sider radi euatios as amended from time to time. have aso exaied copiace ith the appicae causes of the fooi

(i) ecretaria tadards issued he stitute of Copa ecretaries of dia ad (ii) he ecurities ad Exchae oard of dia isti Oiatios ad iscosure euireets euatios as aeded fro tie to tie To the best of my understanding, I am of the view that during the period under review, the Company has complied with the provisions of the Acts, Rules, Regulations, Guidelines, Standards, etc. mentioned above.

68 Corporate Overview Statutory Reports Financial Statements

I further report that Havi reard to the copiace sste prevaii i the Copa ad o exaiatio of the reevat documents and records in pursuance thereof, on test check basis, the Company has complied with the following as appicae specica to the Copa a. rus ad Cosetics Act ad rus ad Cosetics ues as aeded fro tie to tie b. rus ad aic eedies Oectioae Advertiseet Act as aeded fro tie to tie ad c. rus rice Cotro Order as aeded fro tie to tie I further report that he oard of irectors of the Copa is du costituted ith proper aace of Executive irectors oExecutive irectors ad depedet irectors he chaes i the copositio of the oard of irectors that took place during the year under review, were carried out in compliance with the provisions of the Copaies Act aedets thereto ad ues ade thereuder Adequate notice is given to all the Directors to schedule the Board Meetings, agenda and detailed notes on aeda ere set at east seve das i advace except i case of aeda havi pricesesitive iforatio ad a sste exists for seei ad otaii further iforatio ad caricatios o the aeda ites efore the meeting and for meaningful participation at the meetings.

I further report that there are adequate systems and processes in the Company commensurate with its size and operations to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

I further report that duri the acia ear the Copa has issued ad aotted euit shares aggregating ` to epoees of the Copa ad its susidiaries o exercisi optios uder various stock option plans.

This Report is to be read with my letter of even date which is enclosed as Annexure ‘G’-1 and forms integral part of this Report.

Ms. Neena Bhatia (Company Secretary) C o C o Place: Mumbai Date: May 28, 2020

LUPIN LIMITED | ANNUAL REPORT 2019-20 69 ANNEXURE ‘G’-1

(TO THE SECRETARIAL AUDIT REPORT OF LUPIN LIMITED FOR YEAR ENDED MARCH 31, 2020)

To, The Members, Lupin Limited My Report of even date is to be read along with this letter.

1. Maintenance of secretarial records is the responsibility of the management of the Company. resposiiit is to express a opiio o the secretaria records ased o audit ue to atioide ocdo o accout of the cotiui Covid padeic as ot ae to phsica exaie ad verif certai iforatio Hoever i such cases veried the records ased o autheticated soft copies of documents furnished by the Company. I have taken declaration from the management regarding the said compliances.

2. I have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctess of the cotets of the secretaria records he vericatio as doe o test asis to esure that correct facts are reected i the secretaria records eieve that the processes ad practices I followed provide a reasonable basis for my opinion.

3. have ot veried the correctess ad appropriateess of acia records ad oos of accouts of the Company.

4. Wherever required, I have obtained the management representation letter about the compliance of laws, rules and regulations and happening of events etc.

5. The compliance of the provisions of corporate and other applicable laws, rules, regulations, standards is the resposiiit of aaeet exaiatio as iited to the vericatio of procedures o test asis

6. The Secretarial Audit Report is neither an assurance as to the future viability of the Company nor of the efficac or effectiveess ith hich the aaeet has coducted the affairs of the Copa

Ms. Neena Bhatia (Company Secretary) C o C o Place: Mumbai Date: May 28, 2020

70 Corporate Overview Statutory Reports Financial Statements

ANNEXURE ‘H’ TO THE DIRECTORS’ REPORT FORM NO. MGT - 9. EXTRACT OF ANNUAL RETURN as on the year ended March 31, 2020 [Pursuant to Section 92(3) of the Companies Act, 2013, and Rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS: (i) Corporate Identity Number (CIN) HC (ii) Registration Date arch (iii) Name of the Company E (iv) CateoruCateor of the Copa Company having Share Capital (v) Address of the eistered office ad cotact apataru spire rd Floor, details Off ester Express Hiha Santacruz (East), uai e o (vi) Whether listed Company Yes (vii) Name, address and contact details of Registrar i tie dia vt td and Transfer Agent, if any (Share Transfer Agent) it upi iited C ar ar ihroi est uai e o o ree o ax Eai rthepdesiitiecoi

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY: All the business activities contributing 10% or more of the total turnover of the Company shall be stated: Name and Description of main Products/ NIC Code of the Product/Service % to total turnover of Services the Company Pharmaceuticals 210

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES: Sl. Name and Address of the Company CIN/GLN Holding/ % of shares Applicable No. Subsidiary/ held Section Associate 1. upi haraceuticas c N.A. Subsidiary 2(87) Harorace oer 111 South Calvert Street, st oor atiore MD 21202, USA. 2. oa haraceutica dustr Co N.A. Subsidiary 2(87) td up to eceer Nakanoshima Festival Tower West aaoshia itau Osaa apa 3. hara aics roprietar td N.A. Subsidiary 2(87) st oor rapevie House teeer Office ar Silverwood Close, Westlake, Cape Town, 7945, O ox outh Africa

LUPIN LIMITED | ANNUAL REPORT 2019-20 71 Sl. Name and Address of the Company CIN/GLN Holding/ % of shares Applicable No. Subsidiary/ held Section Associate 4. Horosa hara H N.A. Subsidiary 2(87) Haauer adstrae 60314 Frankfurt am Main Germany. 5. Multicare Pharmaceuticals N.A. Subsidiary 2(87) Philippines, Inc., th oor uo oer Aaa Avenue, Makati City, Philippines. 6. eeric Heath t td N.A. Subsidiary 2(87) eve uite rospect t ox Hi ictoria Australia. 7. oa CritiCare Co td up to N.A. Subsidiary 2(87) September 30, 2019) 4-18-29, Asahicho, Atsugi-City, aaaa apa 8. upi Hodis o o as N.A. Subsidiary 2(87) Nanomi B.V.), Naritaweg 165, Telestone 8, 1043 BW Amsterdam Netherlands. 9. upi Atatis Hodis A N.A. Subsidiary 2(87) adis rtrasse 6300 Zug, Switzerland. 10. upi Heathcare td N.A. Subsidiary 2(87) The Urban Building, Floor 2, 3-9 Albert Street, Slough, ershire E 11. upi Austraia t td N.A. Subsidiary 2(87) eve uite rospect t ox Hi ictoria Austraia 12. upi hara Caada td N.A. Subsidiary 2(87) 15 Wertheim Crt, Suite 707 ichod Hi Otario H 13. upi exico A de C N.A. Subsidiary 2(87) Gabriel Mancera 1761, Cooia e ae Ciudad de exico c.p. 03100. 14. eether hara t td N.A. Subsidiary 2(87) eve uite rospect t ox Hi ictoria Austraia 15. upi hiippies c N.A. Subsidiary 2(87) 1135 Chino Roces Avenue, Makati City, 1231, Philippines. 16. upi Heathcare td HC Subsidiary 2(87) apataru spire rd oor Off ester Express Hiha Santacruz (East), Mumbai - 400 055. 1 7. eeric Heath H N.A. Subsidiary 2(87) pper ethouse isa o aa aa Adua Off aa uta sai uaa upur Malaysia. 18. upi idde East C N.A. Subsidiary 2(87) Executive Office o Floor No. 1, Block No. 03, Dubai International Academic City, O ox uai AE 19. upi c N.A. Subsidiary 2(87) Harorace oer 111 South Calvert Street, st oor atiore MD 21202, USA. 20. upi H N.A. Subsidiary 2(87) adis rtrasse 6300 Zug, Switzerland.

72 Corporate Overview Statutory Reports Financial Statements

Sl. Name and Address of the Company CIN/GLN Holding/ % of shares Applicable No. Subsidiary/ held Section Associate 21. aoi ered ith upi N.A. Subsidiary 2(87) Hodis etherads effective April 1, 2019) utphestraat E OE AA etherads 22. aoratorios ri A de C N.A. Subsidiary 2(87) Rodriguez Saro#630, Co e ae Ciudad de exico C C 23. Medquimica Industria Farmaceutica N.A. Subsidiary 2(87) A ua erado aarca 255 - Distrito Industrial, ui de ora ias erais Brazil 36092-030. 24. ove aoratories c N.A. Subsidiary 2(87) 400 Campus Drive, Somerset, e erse A 25. upi esearch c N.A. Subsidiary 2(87) Harorace oer 111 South Calvert Street, st oor atiore MD 21202, USA. 26. upi hara C up to Apri N.A. Subsidiary 2(87) 2019) Russian Federation, 1 17246, Moscow, Nauchny proezd 17, reises oos ussia 2 7. upi ata c N.A. Subsidiary 2(87) 5801, Pelican Bay Boulevard - suite 500 Naples, Florida 34108, USA. 28. upi apa Asia acic N.A. Subsidiary 2(87) oraoa His ori oer 1-23-3, Toranoman, Minato-ku, oo apa 29. upi aaeet c earier N.A. Subsidiary 2(87) o as upi etures c 5801 Pelican Bay Blvd, Suite 500 Naples, A 30. ioix herapeutics C up to N.A. Subsidiary 2(87) December 30, 2019) outh Cavert treet st oor Baltimore, MD 21202, USA. 31. upi Europe H N.A. Subsidiary 2(87) Haauer adstrae 60314 Frankfurt am Main Germany.

Note: A copaies except upi Heathcare td o are icorporated outside dia hece C are ot appicae

LUPIN LIMITED | ANNUAL REPORT 2019-20 73 IV. SHAREHOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity): i) Category-wise Shareholding:

No. of Shares held at the beginning of the year No. of Shares held at the end of the year i.e. as on 01.04.2019 i.e. as on 31.03.2020 % change Category of Shareholders % of during % of Total Demat Physical Total Demat Physical Total Total the year shares shares (A) Promoters (1) Indian (a) dividuasH 5650113 0 5650113 1.25 5670513 0 5670513 1.25 0.00 (b) Central Government (c) State Government(s) (d) Bodies Corporate 205609135 0 205609135 45.44 205609135 0 205609135 45.39 -0.05 (e) iacias stitutios Banks (f) Any Other Sub-Total (A)(1) 211259248 0 211259248 46.69 211279648 0.00 211279648 46.64 -0.05 (2) Foreign (a) NRIs - Individuals 1286394 0 1286394 0.28 1286394 0 1286394 0.28 0.00 (b) Other - Individuals (c) Bodies Corporate (d) as (e) Any Other Sub-Total (A)(2) 1286394 0 1286394 0.28 1286394 0 1286394 0.28 0.00 Total Shareholding of Promoter and Promoter 212545642 0 212545642 46.97 212566042 0 212566042 46.92 -0.05 Group (A) = (A)(1)+(A)(2) (B) Public shareholding (1) Institutions (a) Mutual Funds 28990464 30200 29020664 6.41 45885207 29600 45914807 10.14 3.72 (b) as 1961655 3900 1965555 0.43 1453658 3900 1457558 0.32 -0.11 (c) Central Government 1270832 0 1270832 0.28 1270943 0 1270943 0.28 0.00 (d) State Government(s) (e) Venture Capital Funds (f) Insurance Companies 22425287 100 22425387 4.96 25465378 100 25465478 5.62 0.67 (g) FIIs 117059368 3600 117062968 25.87 102745849 0 102745849 22.68 -3.19 (h) Foreign Venture Capital Funds (i) Any other: ------Alternate Investment 522589 0 522589 0.12 848396 0 848396 0.19 0.07 Funds Foreign Bodies 5000 0 5000 0.00 5000 3600 8600 0.00 0.00 Sub Total (B)(1) 172235195 37800 172272995 38.07 177674431 37200 177711631 39.23 1.16 (2) Non-Institutions (a) Bodies Corporate i) Indian 5654673 21300 5675973 1.25 3191832 21300 3213132 0.71 -0.55 ii) Overseas (b) Individuals i) Individual 37079994 1242988 38322982 8.47 34532884 1009908 35542792 7.8 5 -0.62 shareholders holding nominal share capital upto ` 1 lakh ii) Individual shareholders 13494116 0 13494116 2.98 12891623 0 12891623 2.85 -0.14 holding nominal share capita i excess of ` 1 lakh

74 Corporate Overview Statutory Reports Financial Statements

No. of Shares held at the beginning of the year No. of Shares held at the end of the year i.e. as on 01.04.2019 i.e. as on 31.03.2020 % change Category of Shareholders % of during % of Total Demat Physical Total Demat Physical Total Total the year shares shares (c) Others (specify): Non-Resident Indians 2444024 21400 2465424 0.54 2101368 20200 2121568 0.47 -0.08 Foreign Nationals 103606 0 103606 0.02 99418 0 99418 0.02 0.00 Clearing Members 1933229 0 1933229 0.43 1693652 0 1693652 0.37 -0.05 Trusts 5279617 0 5279617 1.17 6535872 0 6535872 1.44 0.28 IEPF 400113 0 400113 0.09 622391 0 622391 0.14 0.05 Sub Total (B)(2) 66389372 1285688 67675060 14.96 61669040 1051408 62720448 13.85 -1.11 Total Public Share holding 238624567 1323488 239948055 53.03 239343471 1088608 240432079 53.08 0.05 (B) = (B)(1) + (B)(2) TOTAL (A) + (B) 451170209 1323488 452493697 100.00 451909513 1088608 452998121 100.00 0.00 (C) Shares held by ------Custodians for GDRs and ADRS GRAND TOTAL: 451170209 1323488 452493697 100.00 451909513 1088608 452998121 100.00 0.00 (A)+(B)+(C) ii) Shareholding of Promoters: Sl. Shareholder’s Name No. of Shares held at the beginning No. of Shares held at the end of % change in No. of the year as on 01.04.2019 the year as on 31.03.2020 shareholding No. of Shares % of total % of Shares Pledged No. of Shares % of total Shares % of Shares during the Shares / encumbered to of the Company Pledged / year of the total shares encumbered to Company total shares 1. upi vestets vt td 205608135 45.44 0.000 205608135 45.39 0.000 -0.05 2. Manju D. Gupta 3871162 0.86 0.000 3871162 0.85 0.000 0.00 3. upta H 647580 0.14 0.000 647580 0.14 0.000 0.00 4. Nilesh Gupta 901064 0.20 0.000 901064 0.20 0.000 0.00 5. Anuja Gupta 725705 0.16 0.000 725705 0.16 0.000 0.00 6. Richa Gupta 233265 0.05 0.000 233265 0.05 0.000 0.00 7. Vinita Gupta 327424 0.07 0.000 327424 0.07 0.000 0.00 8. avita upta 200170 0.04 0.000 200170 0.04 0.000 0.00 9. Veda Nilesh Gupta 28385 0.01 0.000 45285 0.01 0.000 0.00 10. Neel Deshbandhu Gupta 0 0.00 0.000 3500 0.00 0.000 0.00 11. Shefali Nath Gupta 1752 0.00 0.000 1752 0.00 0.000 0.00 12. Manju D Gupta (As a Trustee 1000 0.00 0.000 1000 0.00 0.000 0.00 of Gupta Family Trust) Total: 212545642 46.97 0.000 212566042 46.92 0.000 -0.05 iii) Change in Promoters’ Shareholding: Sl. Shareholder’s Name No. of Shares held at the beginning No. of Shares held at the end % change in No. of the year of the year shareholding No. of Shares % of total % of Shares No. of Shares % of total % of Shares during the Shares Pledged/ Shares Pledged/ year of the encumbered to of the Company encumbered to Company total shares total shares 1. upi vestets vt td 205608135 45.44 0.000 205608135 45.39 0.000 -0.05 2. Manju D. Gupta 3871162 0.86 0.000 3871162 0.85 0.000 0.00 3. upta H 647580 0.14 0.000 647580 0.14 0.000 0.00 4. Nilesh Gupta 901064 0.20 0.000 901064 0.20 0.000 0.00 5. Anuja Gupta 725705 0.16 0.000 725705 0.16 0.000 0.00 6. Richa Gupta 233265 0.05 0.000 233265 0.05 0.000 0.00 7. Vinita Gupta 327424 0.07 0.000 327424 0.07 0.000 0.00 8. avita upta 200170 0.04 0.000 200170 0.04 0.000 0.00 9. Veda Nilesh Gupta 28385 0.01 0.000 45285 0.01 0.000 0.00 10 Neel Deshbandhu Gupta 0 0.00 0.000 3500 0.00 0.000 0.00 11. Shefali Nath Gupta 1752 0.00 0.000 1752 0.00 0.000 0.00 12. Manju D. Gupta (As a Trustee 1000 0.00 0.000 1000 0.00 0.000 0.00 of Gupta Family Trust) Total: 212545642 46.97 0.000 212566042 46.92 0.000 -0.05

LUPIN LIMITED | ANNUAL REPORT 2019-20 75 iv) Shareholding Pattern of Top Ten Shareholders (Other than Directors and Promoters): Sl. Name of the Date Increase/ No. of Shares held at the Cumulative Shareholding No. Shareholder Decrease beginning of the year during the year and reason as on 01.04.2019 for the No. of Shares % of total No. of % of total same* Shares of the Shares Shares of the Company Company 1 HDFC Trustee At the beginning - 497358 0.11 -- Company Limited- of the year HDFC Equity Fund 05.04.2019 39900 - - 537258 0.12 12.04.2019 -410 - - 536848 0.12 26.04.2019 62300 - - 599148 0.13 10.05.2019 1400 - - 600548 0.13 17.05.2019 121100 - - 721648 0.16 24.05.2019 439918 - - 1161566 0.26 31.05.2019 510000 - - 1671566 0.37 02.08.2019 -43400 - - 1628166 0.36 23.08.2019 -164500 - - 1463666 0.32 30.08.2019 -91700 - - 1371966 0.30 06.09.2019 50000 - - 1421966 0.31 13.09.2019 159700 - - 1581666 0.35 20.09.2019 497000 - - 2078666 0.46 27.09.2019 759067 - - 2837733 0.63 04.10.2019 7000 - - 2844733 0.63 11.10.2019 -122600 - - 2722133 0.60 18.10.2019 899220 - - 3621353 0.80 25.10.2019 945080 - - 4566433 1.01 01.11.2019 1000000 - - 5566433 1.23 08.11.2019 43400 - - 5609833 1.24 15.11.2019 1654200 - - 7264033 1.60 22.11.2019 500000 - - 7764033 1.71 13.12.2019 135100 - - 7899133 1.74 03.01.2020 110000 - - 8009133 1.77 10.01.2020 83500 - - 8092633 1.79 17.01.2020 547000 - - 8639633 1.91 24.01.2020 260000 - - 8899633 1.96 14.02.2020 910407 - - 9810040 2.17 28.02.2020 -294000 - - 9516040 2.10 06.03.2020 1476000 - - 10992040 2.43 20.03.2020 301506 - - 11293546 2.49 27.03.2020 267400 - - 11560946 2.55 31.03.2020 -1100 - - 11559846 2.55 At the end of -- - 11559846 2.55 the year 2 Life Insurance At the beginning - 10951777 2.42 -- Corporation of India of the year At the end of -- - 10951777 2.42 the year 3 Franklin India At the beginning - 4730000 1.04 -- Focused Equity Fund of the year 02.08.2019 -516 - - 4729484 1.04 08.11.2019 -500000 - - 4229484 0.93 29.11.2019 -229484 - - 4000000 0.88 06.12.2019 -459871 - - 3540129 0.78 03.01.2020 -129 - - 3540000 0.78 14.02.2020 2300000 - - 5840000 1.29 21.02.2020 1020092 - - 6860092 1.51 28.02.2020 979908 - - 7840000 1.73 06.03.2020 383797 - - 8223797 1.82 13.03.2020 190929 - - 8414726 1.86 20.03.2020 385274 - - 8800000 1.94 31.03.2020 200000 - - 9000000 1.99 At the end of -- - 9000000 1.99 the year

76 Corporate Overview Statutory Reports Financial Statements

Sl. Name of the Date Increase/ No. of Shares held at the Cumulative Shareholding No. Shareholder Decrease beginning of the year during the year and reason as on 01.04.2019 for the No. of Shares % of total No. of % of total same* Shares of the Shares Shares of the Company Company 4 Rakesh At the beginning - 8723605 1.93 -- Jhunjhunwala of the year 17.05.2019 -1000000 - - 7723605 1.71 19.07.2019 125000 - - 7848605 1.73 02.08.2019 -290000 - - 7558605 1.67 16.08.2019 -488000 - - 7070605 1.56 27.12.2019 -135000 - - 6935605 1.53 31.01.2020 85000 - - 7020605 1.55 21.02.2020 -200000 - - 6820605 1.51 20.03.2020 25000 - - 6845605 1.51 At the end of -- - 6845605 1.51 the year 5 NPS Trust- A/C LIC At the beginning - 5152145 1.14 -- Pension Fund Scheme of the year - State Govt 05.04.2019 2265 - - 5154410 1.14 17.05.2019 24800 - - 5179210 1.14 14.06.2019 11699 - - 5190909 1.15 21.06.2019 20046 - - 5210955 1.15 12.07.2019 100 - - 5211055 1.15 19.07.2019 172 - - 5211227 1.15 09.08.2019 -11159 - - 5200068 1.15 16.08.2019 33683 - - 5233751 1.16 27.09.2019 1421 - - 5235172 1.16 18.10.2019 26310 - - 5261482 1.16 01.11.2019 250 - - 5261732 1.16 08.11.2019 1668 - - 5263400 1.16 20.12.2019 1940 - - 5265340 1.16 17.01.2020 241843 - - 5507183 1.22 24.01.2020 162750 - - 5669933 1.25 31.01.2020 178289 - - 5848222 1.29 07.02.2020 135000 - - 5983222 1.32 14.02.2020 52750 - - 6035972 1.33 28.02.2020 110350 - - 6146322 1.36 06.03.2020 58069 - - 6204391 1.37 13.03.2020 65400 - - 6269791 1.38 27.03.2020 167450 - - 6437241 1.42 31.03.2020 23900 - - 6461141 1.43 At the end of -- - 6461141 1.43 the year 6 Government Pension At the beginning - 6555571 1.45 -- Fund Global of the year 31.05.2019 349520 - - 6905091 1.52 29.06.2019 4736 - - 6909827 1.53 26.07.2019 390203 - - 7300030 1.61 02.08.2019 1106316 - - 8406346 1.86 10.01.2020 -281806 - - 8124540 1.79 17.01.2020 -257450 - - 7867090 1.74 14.02.2020 -1681519 - - 6185571 1.37 27.03.2020 -103000 - - 6082571 1.34 At the end of -- - 6082571 1.34 the year 7 Comgest Growth Plc At the beginning - 6841112 1.51 -- - Comgest Growth of the year Emerging Markets 22.11.2019 36966 - - 6878078 1.52 27.03.2020 -589337 - - 6288741 1.39 31.03.2020 -588160 - - 5700581 1.26 At the end of -- - 5700581 1.26 the year

LUPIN LIMITED | ANNUAL REPORT 2019-20 77 Sl. Name of the Date Increase/ No. of Shares held at the Cumulative Shareholding No. Shareholder Decrease beginning of the year during the year and reason as on 01.04.2019 for the No. of Shares % of total No. of % of total same* Shares of the Shares Shares of the Company Company 8 Vanguard Total At the beginning - 3604614 0.80 -- International Stock of the year Index Fund 26.04.2019 -94901 - - 3509713 0.77 26.07.2019 43920 - - 3553633 0.78 16.08.2019 46646 - - 3600279 0.79 30.08.2019 52813 - - 3653092 0.81 14.02.2020 60766 - - 3713858 0.82 28.02.2020 46763 - - 3760621 0.83 13.03.2020 50784 - - 3811405 0.84 20.03.2020 161242 - - 3972647 0.88 27.03.2020 -11934 - - 3960713 0.87 At the end of - - - 3960713 0.87 the year 9 Mirae Asset At the beginning - 214740 0.05 -- Emerging Bluechip of the year Fund 05.04.2019 6500 - - 221240 0.05 10.05.2019 -12600 - - 208640 0.05 02.08.2019 -10000 - - 198640 0.04 23.08.2019 25000 - - 223640 0.05 11.10.2019 20000 - - 243640 0.05 08.11.2019 -20961 - - 222679 0.05 29.11.2019 -20000 - - 202679 0.04 06.12.2019 -12379 - - 190300 0.04 17.01.2020 40000 - - 230300 0.05 24.01.2020 15000 - - 245300 0.05 31.01.2020 28636 - - 273936 0.06 07.02.2020 9261 - - 283197 0.06 14.02.2020 1583787 - - 1866984 0.41 21.02.2020 730000 - - 2596984 0.57 28.02.2020 139887 - - 2736871 0.60 06.03.2020 986300 - - 3723171 0.82 20.03.2020 1966 - - 3725137 0.82 31.03.2020 220000 - - 3945137 0.87 At the end of - - - 3945137 0.87 the year 10 Kotak Standard At the beginning - 4449985 0.98 -- Multicap Fund of the year 05.04.2019 -271600 - - 4178385 0.92 12.04.2019 -172500 - - 4005885 0.88 19.04.2019 -303800 - - 3702085 0.82 26.04.2019 -40453 - - 3661632 0.81 03.05.2019 4900 - - 3666532 0.81 10.05.2019 118300 - - 3784832 0.84 17.05.2019 -66240 - - 3718592 0.82 24.05.2019 81240 - - 3799832 0.84 31.05.2019 32100 - - 3831932 0.85 07.06.2019 117146 - - 3949078 0.87 14.06.2019 20212 - - 3969290 0.88 21.06.2019 -37100 - - 3932190 0.87 29.06.2019 -238000 - - 3694190 0.82 05.07.2019 -9800 - - 3684390 0.81 12.07.2019 -107200 - - 3577190 0.79 19.07.2019 -51100 - - 3526090 0.78 26.07.2019 -11200 - - 3514890 0.78 02.08.2019 -203700 - - 3311190 0.73 09.08.2019 -30100 - - 3281090 0.72 16.08.2019 -3500 - - 3277590 0.72

78 Corporate Overview Statutory Reports Financial Statements

Sl. Name of the Date Increase/ No. of Shares held at the Cumulative Shareholding No. Shareholder Decrease beginning of the year during the year and reason as on 01.04.2019 for the No. of Shares % of total No. of % of total same* Shares of the Shares Shares of the Company Company 23.08.2019 -93800 - - 3183790 0.70 06.09.2019 35700 - - 3219490 0.71 13.09.2019 -2800 - - 3216690 0.71 20.09.2019 48300 - - 3264990 0.72 27.09.2019 154700 - - 3419690 0.75 30.09.2019 700 - - 3420390 0.76 04.10.2019 -224000 - - 3196390 0.71 11.10.2019 -6300 - - 3190090 0.70 18.10.2019 -4900 - - 3185190 0.70 25.10.2019 37800 - - 3222990 0.71 01.11.2019 116900 - - 3339890 0.74 08.11.2019 382200 - - 3722090 0.82 15.11.2019 13600 - - 3735690 0.82 22.11.2019 411500 - - 4147190 0.92 29.11.2019 396200 - - 4543390 1.00 06.12.2019 222600 - - 4765990 1.05 13.12.2019 34700 - - 4800690 1.06 20.12.2019 29400 - - 4830090 1.07 27.12.2019 1400 - - 4831490 1.07 31.12.2019 -50400 - - 4781090 1.06 03.01.2020 -127400 - - 4653690 1.03 10.01.2020 -1400 - - 4652290 1.03 17.01.2020 32900 - - 4685190 1.03 24.01.2020 34000 - - 4719190 1.04 31.01.2020 -359800 - - 4359390 0.96 07.02.2020 -951300 - - 3408090 0.75 14.02.2020 -37100 - - 3370990 0.74 28.02.2020 29400 - - 3400390 0.75 06.03.2020 377600 - - 3777990 0.83 13.03.2020 77800 - - 3855790 0.85 20.03.2020 -700 - - 3855090 0.85 27.03.2020 -131600 - - 3723490 0.82 31.03.2020 86800 - - 3810290 0.84 At the end of - - - 3810290 0.84 the year rasfer of shares ie urchase ad ae of hares ere the reasos for creaseecrease v) Shareholding of Directors and Key Managerial Personnel: Sl. Name of the Director/ Particulars No. of Shares held at the Cumulative Shareholding No. Key Managerial beginning of the year i.e. as on during the year Personnel 01.04.2019 Date Reason for No. of Shares % of total No. of % of total increase/ Shares of the Shares Shares of the decrease Company Company 1. Dr. D. B. Gupta (HUF) At the - 647580 0.14 - - beginning of the year At the end of - - - 647580 0.14 the year 2. Mrs. Manju D. Gupta At the - 3871162 0.85 - - beginning of the year At the end of - - - 3871162 0.85 the year 3. Dr. Kamal K. Sharma At the - 169900 0.04 - - beginning of the year At the end of - - - 169900 0.04 the year

LUPIN LIMITED | ANNUAL REPORT 2019-20 79 Sl. Name of the Director/ Particulars No. of Shares held at the Cumulative Shareholding No. Key Managerial beginning of the year i.e. as on during the year Personnel 01.04.2019 Date Reason for No. of Shares % of total No. of % of total increase/ Shares of the Shares Shares of the decrease Company Company 4. Ms. Vinita Gupta At the - 327424 0.07 - - beginning of the year At the end of - - - 327424 0.07 the year 5. Mr. Nilesh Deshbandhu At the - 901064 0.20 - - Gupta beginning of the year At the end of - - - 901064 0.20 the year 6. Mr. Ramesh As at March - 18732 0.00 - - Swaminathan 26, 2020 At the end of - - - 18732 0.00 the year 7. Mr. R. A. Shah At the - 32000 0.01 - - beginning of the year At the end of - - - 32000 0.01 the year 8. Mr. Richard Zahn At the - - - - - beginning of the year At the end of - - - - - the year 9. Dr. K. U. Mada At the - 4000 0.00 - - beginning of the year At the end of - - - 4000 0.00 the year 10. Mr. Dileep C. Choksi At the - - - - - beginning of the year At the end of - - - - - the year 11. Mr. Jean-Luc Belingard At the beginning of - - - the year At the end of - - - - - the year 12. Ms. Christine Mundkur At the beginning of - - - - - the year At the end of - - - - - the year 13. Mr. Sunil Makharia As at - 12961 0.00 - - June 10, 2019 Allotment 28.11.2019 3062 - 16023 0.00 under ESOP Allotment 23.12.2019 2451 - 18474 0.00 under ESOP Allotment 24.01.2020 1837 - 20311 0.00 under ESOP As at March - - - 20311 0.00 25, 2020 14. Mr. R. V. Satam At the beginning of - 982 0.00 - - the year Allotment 25.02.2020 1012 - - - under ESOP At the end of - - - 1994 0.00 the year

80 Corporate Overview Statutory Reports Financial Statements

V. INDEBTEDNESS Indebtedness of the Company including interest outstanding/accrued but not due for payment (Standalone):

(` in million) Secured Loans Unsecured Total excluding Deposits Loans Indebtedness deposits Indebtedness at the beginning of the financial year (i) Principal Amount 16.8 40.8 - 5 7.6 (ii) Interest due but not paid - - - - (iii) Interest accrued but not due - 0.1 - 0.1 Total: (i) + (ii) + (iii) 16.8 40.9 - 5 7.7 Change in Indebtedness during the financial year  Addition, Net 36.1 - - 36.1  Reduction, Net - (35.5) - (35.5) Net Change 36.1 (35.5) - 0.6 Indebtedness at the end of the financial year (i) Principal Amount 52.9 5.4 - 58.3 (ii) Interest due but not paid - - - - (iii) Interest accrued but not due - - - - Total: (i) + (ii) + (iii) 52.9 5.4 - 58.3

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Remuneration to Managing Director, Whole-time Directors: (` in million) Sl. Particulars of Remuneration Name of the MD/WTD/Manager Total No. Amount *Ms. Vinita Mr. Nilesh Mr. Ramesh Gupta Deshbandhu Gupta Swaminathan (w.e.f. March 26, 2020) 1) Gross Salary (a) Salary as per provisions contained in Section 92.99 43.87 0.79 137.65 of the coe ax Act (b) Value of perquisites under Section 17(2) - 1.98 - 1.98 coe ax Act c rots i ieu of saar uder ectio - - - - coe ax Act 2) Stock Options - - - - 3) Sweat Equity - - - - 4) Commission - - - - as of prot - - - - - others - - - - 5) Others 35.29 13.83 - 49.12 - Performance-linked Incentive Total (A) 128.28 59.68 0.79 188.75 s iita upta is a epoee of upi aaeet c A hooed susidiar of the Copa

LUPIN LIMITED | ANNUAL REPORT 2019-20 81 B. Remuneration to other directors: (` in million) Sl. Particulars of Remuneration Name of Directors Total No. Amount 1) Independent Directors Mr. R. A. Mr. Richard Dr. K. U. Mr. Dileep Mr. Jean-Luc Ms. Christine Shah Zahn Mada C. Choksi Belingard Mundkur ee for attedi oard 0.26 0.26 0.46 0.32 0.14 0.18 1.62 Committee Meetings Coissio 3.50 7. 5 6 3.00 3.00 7. 5 7 7. 5 7 32.20 Others ------Total (B)(1) 3.76 7.82 3.46 3.32 7.7 1 7.75 33.82 2) Other Non-Executive Directors Mrs. Manju D. Gupta Dr. Kamal K. Sharma* ee for attedi oard 0.19 0.34 0.53 Committee Meetings Coissio 3.50 5.00 8.50 Others - 27.09 27.09 Total (B)(2) 3.69 32.43 36.12 Total (B) = (B)(1) + (B)(2) 69.94 Overall Ceiling as per the Act ` iio ei of the et prots of the Copa cacuated as per ectio 198 of the Companies Act, 2013). Total Managerial ` 258.69 million Remuneration (A) + (B)

* he oard appoited r aa hara ice Chaira as a Advisor to the Copa for a period of oeear effective Octoer at xed fee of ` iio per au paae uarter ad a aout ot exceedi of the xed fees as a e decided the Management based on performance. Advisory Fees paid to Dr. Sharma up to September 30, 2019 have been mentioned under Others. C. Remuneration to Key Managerial Personnel other than MD/MANAGER/WTD (` in million) Sl. Particulars of Remuneration Key Managerial Personnel No. Mr. Sunil Makharia, Mr. R. V. Satam, Interim CFO and Company Secretary President - Finance (from 10.06.2019 to 25.03.2020) 1) Gross Salary (a) Salary as per provisions contained in Section 17(1) of the 19.73 5.32 coe ax Act (b) aue of prereuisites uder ectio coe ax Act 1.35 1.20 1961. (c) rots i ieu of saar uder ectio coe ax Act - - 1961. 2) Stock Options 4.94 0.82 3) Sweat Equity - - 4) Commission as of prot - - - others, specify - - 5) Others (Performance-linked Incentive) 6.53 1.07 Total (C) 32.55 8.41

82 Corporate Overview Statutory Reports Financial Statements

VII. PENALTIES/PUNISHMENT/COMPOUNDING OF OFFENCES: Type Section of the Brief Description Details of Penalty/ Appeal made, if any Companies Act Punishment/ (give details) Compounding fees imposed A. COMPANY Penalty Punishment None Compounding B. DIRECTORS Penalty Punishment None Compounding C. OTHER OFFICERS IN DEFAULT Penalty Punishment None Compounding

For and on behalf of the Board of Directors

Manju D. Gupta Chairperson

Mumbai, May 28, 2020

LUPIN LIMITED | ANNUAL REPORT 2019-20 83 Corporate Governance Report

[1] Company’s Philosophy on Corporate impartiality in its dealings with stakeholders and the Governance: public at large. It adheres to uncompromising integrity he Copa is of the r eief that a effective in the conduct of business and does not tolerate framework of corporate governance is the foundation corrupt and immoral practices. As a testament for sustainable growth. The Company’s philosophy of its robust corporate governance practices on corporate governance has been to adhere to the and ethical conduct of business, the Company highest standards of ethical behaviour and fairness to instituted P.L.E.D.G.E. (Preparing Lupin Employees stakeholders. Transparency, accountability, integrity to Demonstrate Governance and Ethical Conduct). and professionalism are deeply embedded in the P.L.E.D.G.E. initiative encompasses three important Company’s culture. Corporate Governance has been policies viz. Code of Conduct, Whistleblower Policy a continuous journey for the Company in its pursuit ad revetio of orpace Harasset icudi towards achieving the highest standards and in sexua harasset at orpace his iitiative has pursuance it has been striving assiduously to adopt empowered employees to report unethical practices, the best global practices. Good governance practices set up specied echaiss to dea ith orpace combined with strong leadership has been the harassments and facilitates their swift redressal. inherent strength of the Company. Employees are at liberty to raise their concerns without any fear of retaliation or retribution and The Board of Directors is a blend of highly report to the Office of Oudsperso a potetia experieced persos of iese repute t has issues concerning fraudulent business practices, a optiu ix of executive oexecutive ad unethical behaviour, discriminating or gender-biased independent directors who ensure that best standards misconduct and violation of the Company’s Policies of corporate governance are nurtured and put into or Codes of Conduct. Anonymous complaints are also practice. The Board has an ideal combination of investigated on the same lines. entrepreneurship, leadership and professionalism. The three women directors on the Board have rich uri the ear the Oudsperso received ad ide experiece of decades i diverse eds complaints, mostly of minor nature. Teams of Effective Apri s Christie udur oied trateic usiess it HeadsOfficers appoited the Board as an Independent Woman Director. the Oudsperso ivestiatedexaied the In addition to complying with requisite mandatory complaints and the same were satisfactorily resolved. requirements, the Company has also complied with a he Copa did ot receive a copait of sexua few non-mandatory requirements, as stipulated under harassment during the year. euatio of the E isti Oiatios ad The Company has sound mechanism and systems iscosure euireets euatios isti of internal checks and balances which are evaluated euatios such as uodied audit opiios o and updated at regular intervals. The Company acia stateets ad appoitet of separate has put i dedicated efforts toards safeuardi persos as Chairperso Chief Executive Officer ad its Information and has persistently maintained Managing Director. this mark with rollout of Information Security Codes of Conduct have been adopted for Directors, Management System framework. The said framework Senior Management Personnel and Independent AACH proect auched padia ipeets Directors. The Codes have been hosted on the website all the requisite information security controls and of the Company (www.lupin.com). In compliance continuously helps in creation of awareness among ith euatio of the isti euatios the end-users. With technology orchestration, all Directors, Senior Management Personnel and AACH protects iforatio of the Copa depedet irectors have affired copiace ith adopting various policies, procedures and guidelines. their respective Codes for the ear eded arch hrouh AACH securit advisories are reuar r iesh eshadhu upta aai issued to a ed users to protect the fro spa Director, has given the requisite declaration to this phishing mails or cyber frauds. The Company has effect ee accredited OEC certicatio for its Information Security Management Systems The Company abides by well-accepted norms of at seect ocatios at Head Office ue esearch ethical, moral and legal conduct in all its business Park, manufacturing facilities at Biotech, Mandideep operations. The Company encourages and promotes and Indore. As part of continuous improvement, the a culture of intensive deliberations, transparency and Company intends to add two more locations viz.

84 Corporate Overview Statutory Reports Financial Statements

Aeshar ad isahapata to the certicatio ist as part of iproveet he Copa has exteded its iforatio securit coitet to its oa ocatios ie the A EEA AAC ad AA reios uder the rad ae HE to provide assurace aout iforatio securit copiace ith euatio of the isti euatios the Copa has tae irectors ad Officers Insurance (D&O) for its Directors and Members of the Senior Management. he Copa is i copiace ith Chapter of the isti euatios o Corporate overace A detailed Management Discussion and Analysis report forms part of this Annual Report. [2] Board of Directors: he streth of the oard as o arch as eeve of hich to are executive prooterdirectors oe oexecutive prooterdirector oe professioa oexecutive director oe executive director ad six idepedet directors hich is i copiace ith euatio of the isti euatios ad ectio of the Copaies Act Act ad ues ade thereuder copiace ith chedue Ci of the isti euatios s eea hatia ractisi Copa ecretar certied that o irector of the Copa have ee disuaied the ecurities ad Exchae oard of diaiistr of Corporate Affairs or a statutory authority from being appointed or continuing as director of the Company. The Company has three oe directors of hich oe is a depedet irector hich is i copiace ith euatio of the isti euatios A depedet irectors have cored their depedece the opiio of the oard a depedet irectors fu the criteria of idepedece as specied i the Act ad the isti euatios ad are idepedet of the aaeet articuars prescried chedue C of the isti euatios are ive eo

Whether Number of Member/ No. of Board Attendance Sl. Promoter/ directorships Chairman of Expertise in specific Name of the director Meetings during at the last No. Executive/ of other committees other functional areas the year AGM Independent companies than Company Held Attended 1. Mrs. Manju D. Gupta, P. & N.E.D. 8 8 Yes 6 - General Management Chairperson 2. r aa hara N.E.D. 8 8 Yes 6 - Corporate Vice Chairman Development and General Management 3. Ms. Vinita Gupta, P. & E.D. 8 8 Yes 11 - Marketing, Strategic Chief Executive Officer Planning and eadership 4. Mr. Nilesh Deshbandhu Gupta, P. & E.D. 8 8 Yes 6 - Operations, Pipeline Managing Director Management and Strategy 5. Mr. Ramesh Swaminathan, E.D. N.A. N.A. N.A. - - Finance, Mergers Executive Director, Global CFO & Acquisitions and & Head Corporate Affairs Corporate Affairs (w.e.f. March 26, 2020) 6. Mr. R. A. Shah* I. N-E.D. 8 8 Yes 8 Solicitor specialising in broad spectrum of Corporate laws 7. Mr. Richard Zahn I. N-E.D. 8 8 Yes - - Strong pharmaceutical background and General Management 8. r ada I. N-E.D. 8 7 Yes - - Economist and Development Banker 9. Mr. Dileep C. Choksi** I. N-E.D. 8 7 Yes 11 ax expert ad Financial Advisor 10. r eauc eiard I. N-E.D. 8 7 No 6 - Strong pharmaceutical background and General Management 11. Ms. Christine Mundkur I. N-E.D. 8 8 Yes 3 Strong pharmaceutical background and General Management r A hah is depedet irector of rocter ae Hiee ad Heathcare iited er iited A dia iited Coateaoive dia iited ad odepedet irector of odfre hiips dia iited ad Atu iited ieep C Chosi is depedet irector of eepa itrite iited AA Eieeri iited Arvid iited ara Eies iited ad CC rudetia ife surace Copa iited

LUPIN LIMITED | ANNUAL REPORT 2019-20 85 Notes: (a) E rooter Executive irector E rooter oExecutive irector E Executive irector E depedet oExecutive irector (b) Mrs. Manju D. Gupta is the mother of Ms. Vinita Gupta and Mr. Nilesh Deshbandhu Gupta. (c) o irector hods directorships i ore tha te puic copaieseiht isted copaies ad o Independent Director holds Independent directorships in more than seven listed companies. (d) o depedet irector is eer of ore tha te coittees or Chaira of ore tha ve coittees across a puic copaies i hich the are directors eershipChairaship of Committees includes only Audit Committee and Stakeholders’ Relationship Committee. Core Skills/Expertise/Competencies identified by the Board he oard has idetied the fooi core sisexpertisecopetecies for the efficiet fuctioi of the Copa ad are curret avaiae ith the oard

Global Understanding the pharmaceutical business space across diverse geographies and regulatory jurisdictions Business with a view to enable the Company to retain its world-wide leadership position as a global pharma powerhouse. Mergers & Ability to tap organic and inorganic growth through acquisitions as also other business combinations with an Acquisitions eye on evaluating ‘build or buy’ decisions, value transactions and assess operational integration plans. Strategic Taking strategic decisions with a view to seize multiple business opportunities in Branded and Generic planning oruatios iotechoopeciat roducts iosiiars Active haraceutica rediets teeri i the fast-growing OTC segment and ramp-up the R&D pipeline. Corporate urturi the est stadards of Corporate overace to axiie the oter vaue of its staehoders Governance by adhering to the principles of transparency, integrity, professionalism, fairness and accountability.

Board Meetings chaes if a he Copa faciitates videoaudio At its meetings, the Board sets corporate objectives conferencing in case any Director wishes to attend the of the Company, provides strategic directions and Board meeting through such arrangement. guidance to the senior management and monitors Details of Board Meetings the effectiveess of approved poicies he oard During the year, eight Board meetings were held through its various Committees, closely monitor o a ue Auust several business and functional areas. Board meetings Auust oveer oveer are hed o dates hich are aised after seei eruar ad arch coveiece of a irectors usiessepartets The time-gap between two consecutive meetings was Heads are advised to schedue their pas ad ifor ot ore tha das hich as i copiace ith the Secretarial team in respect of matters requiring provisios of ectio of the Act ad euatio Board approval. In compliance with the Secretarial of the isti euatios Additioa the Standards, agenda papers backed by comprehensive Board considered and approved three matters notes together with detailed material information circuatio vide Circuars dated Apri are circulated well in advance to enable the Board epteer ad eceer and its Committees to take informed decisions. Board meeting minutes are circulated to all the Brief profiles, other directorships and committee irectors ithi the prescried tie Actios tae memberships etc. of directors seeking appointment/ Status report on decisions taken at Board meetings re-appointment at the 38th Annual General Meeting. are placed at the subsequent meetings. While the Ms. Vinita Gupta Board is regularly apprised about important business s iita upta is a pharac developments, detailed presentations on important graduate from the University of Mumbai and an matters are made at its meetings by the Chief A fro the eo choo of aaeet at Executive Officer aai irector ad usiess Northwestern University. She has been instrumental fuctioa heads oard eers free express i foruati ad executi the strate that heped their opinions and bring up important matters for the Company to emerge as a global pharmaceutical discussions at meetings. Copies of signed minutes of powerhouse. Through a combination of organic Board Committees, Board meetings of subsidiaries growth and strategic acquisitions, Ms. Vinita has led as aso copiace reportscerticates cori the Copas oa expasio pas he fouded adherence to various applicable laws are regularly the Copas offices i the ited tates s iita tabled at Board meetings. Directors promptly inform has been regularly named by Forbes Asia in its the oard aout oardCoittee icudi op oer usiess oe istis for Asia Chairmanships) positions held by them and their acic he as aso recoied usiess oda shareholdings in other companies and notify

86 Corporate Overview Statutory Reports Financial Statements

Ha of ae ost oerfu oe i usiess Mr. Jean-Luc Belingard and was named Outstanding Business Woman r eauc eiard a rech eader of the ear CC dia usiess eader atioa raduated fro Ecoe des Hautes Etudes Awards. Ms. Vinita was the winner of the inaugural Coerciaes HEC race ad copeted aster E ai usiess Aard of Exceece of Business Administration from Cornell University, and EY Entrepreneur of the Year award winner USA. Mr. Belingard started his career with Merck, for Heath ervices ad echoo i arad harp ad ohe He oved to Hoffaa oche Ms. Vinita is also a member of the Global Advisory ase iterad He as eer of the Executive oard at the eo choo of aaeet at Coittee Hoffaa oche td ad Chief Northwestern University. Executive Officer oche iaostics ase List of other directorships Chairman/ iterad He as Chief Executive Officer Member of the ioerieuxierre are race r eiard as Committees Chaira ad Chief Executive Officer pse roup of the Board race he oied ioerieux A as Chief of the companies on Executive Officer ad ecae its Chaira i which she is a Apri He is a eer of the i ad eida director Gates Foundation. Mr. Belingard is also Foreign Trade upi c A - Advisor to the rech overet He has ee upi haraceuticas c A - conferred upon the prestigious National Awards, upi H iterad - upi esearch c A - Chevalier de I’Ordre National du Merite and Chevalier ove aoratories c A - de a eio dHoeur aards trexo Corporatio A - upi aaeet c A - List of other directorships Chairman/ upi Atatis Hodis A iterad - Member of the Committees upi vestets rivate iited - of the Board a roperties rivate iited - of the c h e r o p e r t i e s r i v a t e i i t e d - companies on Mr. Nilesh Deshbandhu Gupta which he is a director r iesh eshadhu upta is a iorieux A race - Chemical Engineer from the University Department of aorator Corporatio of Aerica A - Chemical Technology (UDCT), Mumbai and a graduate aoratoire ierre are race - with honors from the Wharton School, University of upi Atatis Hodis A iterad - Pennsylvania, USA, where he specialized in healthcare, upi haraceuticas c A - upi c A - strateic aaeet ad ace r upta ed the Company’s research, supply chain, manufacturing, Mr. Ramesh Swaminathan quality and regulatory operations and took charge as r aesh aiatha ris its aai irector i He has ot o ee to the Copa rich experiece of over ears responsible for transforming the Company’s research In addition to having worked with the Company for prora ad expadi the Copas aufacturi more than a decade in his earlier stint, he has also operations but has also been instrumental in worked with reputed organizations in diverse industry foruati ad executi the core strate that has sectors such as dustries td C roup heped it to eere as a oa speciat ad copex tadard Chartered a Hee ad r aesh generics pharmaceutical powerhouse. has won several accolades including the ‘Best CFO’ by Finance Asia, ‘Best CFO’ in the pharmaceutical List of other directorships Chairman/ Member of the sector CC ad usiess oda dias est Committees CO for est everae aaeet are dia of the Board Copaies across sectors A ord Chevei choar of the at the for aaeet tudies r aesh is aso companies on which he is a a uaied Chartered Accoutat Cost Accoutat director ad Copa ecretar He aso hods a A fro upi Heathcare iited - INSEAD, France. Eeet easi ad iace rivate - iited List of other directorships Chairman/Member of the che roperties rivate iited - Committees of the Board of a roperties rivate iited - the companies on which he is a director upi vestets rivate iited - - - oova dustries iited -

LUPIN LIMITED | ANNUAL REPORT 2019-20 87 [3] Audit Committee: 2) Recommending to the Board, the appointment, The Audit Committee comprises of three remuneration and terms of appointment of oexecutive directors ae r ada auditors. (Chairman) and Mr. Dileep C. Choksi, Independent 3) Approving payments to Statutory Auditors for any irector ad r aa hara ice Chaira other additioa services redered the except Dr. Mada is an economist-cum-development those euerated uder ectio of the Act aer havi ide experiece of hadi 4) Reviewing with the management, the annual company managements and project development acia stateets ad auditors report thereo across diverse industries. Mr. Choksi is an eminent before submission to the Board for approval, with Chartered Accoutat ad has rich experiece i particuar referece to consulting large and multinational companies on taxatio aaeet ad copex acia issues a) matters required to be included in the Dr. Sharma has over four decades of rich and varied Directors’ Responsibility Statement included experiece i seior aaeet positios i the in the Board’s Report in terms of Section pharmaceutical and chemical industries in managing c of the Act projects, operations, corporate development and b) changes, if any, in accounting policies and general management. Mr. R. V. Satam, Company practices ad reasos there for Secretary, acts as the Secretary of the Committee. c) major accounting entries involving estimates The composition of the Audit Committee is as ased o the exercise of udet prescried ectio of the Act ad euatio aaeet of the isti euatios A eers of d) siicat adustets ade i the acia the Audit Committee have the ability to read and stateets arisi out of audit dis if a uderstad the acia stateets ad have accouti or reated acia aaeet expertise e) compliance with listing and other legal as stipuated uder euatio c of the isti reuireets reati to acia stateets Regulations. f) discosure of reated part trasactios ad The Audit Committee acts as a vital link between g) odied opiios i the draft audit report if the statutory, internal, cost auditors, Management any. and the Board of Directors. The Audit Committee 5) Reviewing with the management, the quarterly is entrusted with the responsibility of supervising uaudited acia resuts toether ith the itera acia cotros ad acia reporti iited evie eport of the Auditors efore process, appropriateness of audit test checks, submission to the Board for approval. adequacy of provisions for liabilities and reviewing the 6) Reviewing and monitoring the auditor’s governance systems. The Committee lays emphasis on idepedece perforace ad effectiveess of adequate disclosures and compliance with all relevant audit process. statutes. Dr. Mada, Chairman of the Audit Committee 7) Approvi or a suseuet odicatio of atteded the th Annual General Meeting of the transactions of the Company with related parties. Copa hed o Auust he eetis of the Audit Committee are attended by the Statutory 8) Scrutinising inter-corporate loans and investments. Auditors tera Auditors ad seior executives 9) Evauati itera acia cotros ad ris from the Finance Department. Internal Auditors make management systems. presetatios o audit dis at the eetis of the 10) Reviewing with the management, the performance Audit Committee. The Cost Auditor attends the Audit of statutory and internal auditors and adequacy Committee meeting, at which the Cost Audit Report is of the internal control systems. tabled. 11) Reviewing the adequacy of internal audit The Committee performs functions enumerated in function, including the structure of the internal ectio of the Act ad euatio of the audit departet its staffi ad seiorit of isti euatios atters deierated upo ad the officia headi the departet reporti revieed the Coittee icude structure, coverage and frequency of audits.

1) Oversiht of the Copas acia reporti 12) iscussio ith the itera auditors o siicat process ad the discosure of its acia dis ad fooup thereo iforatio to esure that the acia 13) eviei the dis of itera auditors ad stateets are correct sufficiet ad credie reporting them to the Board.

88 Corporate Overview Statutory Reports Financial Statements

14) Discussion with statutory auditors before the The Stakeholders’ Relationship Committee oversees audit commences about the nature and scope of resolution of redressal of investors’ grievances audit as well as post-audit discussion to ascertain and related aspects. The Committee reviews areas of concern, if any. activities covering all facets of operations related 15) Reviewing the functioning of Whistleblower to investors services including dematerialisation mechanism. and transfer of shares in physical mode, activities related to the Investor Education & Protection Fund, 16) Recommending to the Board, the appointment dividend disbursement, management of employee and remuneration of Cost Auditor to conduct audit of cost records in compliance with the stock options plans and compliances with various provisions of the Act and Rules made thereunder. regulatory provisions. The Committee ensures that quality of services to the Investors are of the highest 17) eviei the acia stateets of susidiar standards. copaies as aso the cosoidated acia statements, including investments made by the During the year, the Company received and resolved subsidiary companies. copaits fro sharehoders reardi trasfer 18) Approvi the appoitet of chief acia of shares, non-receipt of annual report, non-receipt officer after assessi the uaicatios of divided etc As o arch o copait experiece ad acroud etc of the cadidate reaied pediuatteded ad o share trasfers copaits reaied pedi for ore tha das 19) Reviewing compliance with the provisions of the Prohibition of Insider Trading Regulations as Details of Stakeholders’ Relationship amended from time to time and verifying that Committee Meetings the systems for internal control for prohibition of During the year, one meeting of the Stakeholders’ Insider Trading are adequate and are operating eatioship Coittee as hed o Octoer effective hereat the attedace as as uder 20) Carrying out such other functions as may be Sl. No. of Meetings mentioned in the terms of reference of the Audit Name of the director No. Held Attended Committee. a. Mr. Dileep C. Choksi, Chairman 1 1 In addition to the above, the Committee reviews the b. r ada 1 1 management discussion and analysis, statement of c. Mr. Nilesh Deshbandhu Gupta 1 1 related party transactions, including granting omnibus Mr. Dileep C. Choksi, Chairman of the Stakeholders’ approvas aaeet ettersitera audit reports eatioship Coittee atteded the th Annual relating to observations on internal controls, etc. General Meeting of the Company held on August Details of Audit Committee Meetings During the year, eight Audit Committee meetings [5] Nomination and Remuneration Committee: were held and the time-gap between two consecutive The Nomination and Remuneration Committee eetis as ot ore tha das hich as C coprises r ada Chaira r A i copiace ith provisios of euatio Shah and Mr. Richard Zahn, all Independent Directors. a of the isti euatios eetis ere hed o Mr. R. V. Satam, Company Secretary, acts as the a Auust epteer Secretary of the Committee. The composition of Octoer oveer the Committee is in compliance with the provisions oveer eruar ad arch of ectio of the Act ad euatio attedace at hich as as uder of the isti euatios he Coittee is aso i copiace ith euatio of the isti Sl. No. of Meetings Name of the director No. Held Attended Regulations, which stipulates that an Independent a. r ada Chairman 8 8 Director shall be Chairman of the Committee. Dr. Mada b. r aa hara 8 7 atteded the th Annual General Meeting of c. Mr. Dileep C. Choksi 8 8 the eers hed o Auust hich is i [4] Stakeholders’ Relationship Committee: copiace ith euatio of the isti The Stakeholders’ Relationship Committee Regulations. comprises Mr. Dileep C. Choksi (Chairman) The NRC recommended to the Board the appointments ad r ada depedet irectors ad of Ms. Christine Mundkur, Independent Director and Mr. Nilesh Deshbandhu Gupta, Managing Director. r aesh aiatha Executive irector oa Mr. R. V. Satam, Company Secretary, acts as the CO Head Corporate Affairs Secretary of the Committee.

LUPIN LIMITED | ANNUAL REPORT 2019-20 89 Role of the NRC: individual Directors to be carried out either by the ursuat to ectio of the Act ad euatio oard the C or a depedet extera read ith art of chedue of the isti agency and review its implementation and Regulations, the NRC performs the functions copiace ad euerated as foos 8) administration of the Employees Stock Option 1) formulation of the criteria for determining Plans. uaicatios positive attriutes ad Remuneration of Executive Directors: independence of a director and recommend to eueratio of Executive irectors o their the board of directors, a policy relating to the appoitetreappoitet is ased o remuneration of the directors, key managerial recommendations made by the Nomination and persoe ad other epoees Remuneration Committee (NRC) to the Board. 2) formulation of criteria for evaluation of The recommendations are within the limits approved performance of independent directors and the by the Members and in line with Company’s annual oard of irectors increment cycle. The NRC approves annual revisions 3) devising a policy on diversity of the Board of and performance-linked incentives. The Company irectors follows a market-linked remuneration policy and reuar echars reueratioepoee 4) idetifi persos ho are uaied to ecoe eets i ie ith the idustr tred ith a ai Directors and who may be appointed in senior to motivate, attract and retain talent. NRC approves management in accordance with the criteria laid remuneration after considering various factors, down and recommend to the Board of Directors such as experiece expertise eadership uaities their appoitet ad reova uaicatios voue of Copas usiess ad 5) hether to exted or cotiue the ter of prots eared it resposiiities shoudered appointment of the Independent Director, based the person and position. The limits for payment on the report of performance evaluation of of reueratio are as prescried ectio depedet irectors Schedule V, Part II, Section I of the Act and Rules 6) recommend to the Board, all remuneration ade thereuder Executive irectors are ot paid in whatever form, payable to the senior sitting fees for attending meetings of the Board and aaeet its Committees. 7) specifi the aer for effective evauatio of performance of the Board, its Committees and

Details of Remuneration paid to Executive Directors are as under: - ` in million Others Stock (Performance- Name of the director Salary Perquisites Total Options Linked Incentive) Ms. Vinita Gupta, Chief Executive Officer 92.99 - - 35.29 128.28 Mr. Nilesh Deshbandhu Gupta, Managing Director 43.87 1.98 - 13.83 59.68 Mr. Ramesh Swaminathan, Executive Director, Global 0.79 - - - 0.79 CFO & Head Corporate Affairs (w.e.f. March 26, 2020)

Note: s iita upta is a epoee of upi aaeet c A hooed susidiar of the Copa Remuneration of Non-Executive Directors: oExecutive irectors receive sitti fees for attedi eetis of the oard ad its Coittees ad they are within the limits prescribed by the Act and Rules made thereunder. In recognition of their valuable contributions to the Company’s business, Independent Directors are paid Commission as approved by Members at the Aua eera eeti hed o u ters of the said approva the are eiie for paet of coissio ot exceedi i the areate per au of the et prot of the Copa coputed i the aer aid do uder ectios ad ad other appicae provisios of the Act The Board is authorised to decide upon the eligibility criteria and quantum of commission payable to each oExecutive irector A aout of ` iio has ee provided toards coissio paae to oexecutive directors for the ear hich oud e paid after the audited accouts for the ear eded arch are approved the oard copiace ith euatio of the isti euatios aua reueratio of a sie oexecutive director did ot exceed ft per cet of the tota aua reueratio paae to a oexecutive directors

90 Corporate Overview Statutory Reports Financial Statements

Details of Remuneration of Non-Executive Directors are as under: -

No. of Equity Shares held as Remuneration for 2019-20 (` in million) Name of the director on March 31, 2020 Remuneration Sitting Fees Commission Total Mrs. Manju D. Gupta, 3,871,162 - 0.19 3.50 3.69 Chairperson r aa hara 169,900 27.09 0.34 5.00 32.43 Vice Chairman Mr. R. A. Shah, 32,000 - 0.26 3.50 3.76 Independent Director Mr. Richard Zahn, - - 0.26 7. 5 6 7.82 Independent Director r ada 4,000 - 0.46 3.00 3.46 Independent Director Mr. Dileep C. Choksi, - - 0.32 3.00 3.32 Independent Director r eauc eiard - - 0.14 7. 5 7 7.7 1 Independent Director Ms. Christine Mundkur, - - 0.18 7. 5 7 7.75 Independent Director

Details of the Nomination and Remuneration udertae the Copa as specied i Committee Meetings chedue of the Act ad During the year four meetings of the NRC were held  Review the monitoring mechanism for ensuring o ue oveer eceer ipeetatio of proectsprorasactivities ad arch hich is i copiace proposed to be undertaken by the Company. ith euatio A of the isti euatios attedace at hich as as uder Details of the CSR Committee Meeting Meeting of the CSR Committee was held on Sl. No. of Meetings Name of the director No. Held Attended eruar attedace at hich as as uder a. r ada Chairman 4 4 Sl. No. of Meetings b. Mr. R. A. Shah 4 4 Name of the director No. Held Attended c. Mr. Richard Zahn 4 4 a. Mrs. Manju D. Gupta, Chairperson 11 The Committee passed eight Resolutions by b. r aa hara 11 circuatio vide Circuars dated Apri a c. Ms. Vinita Gupta 11 u Octoer ad eruar d. Mr. Nilesh Deshbandhu Gupta 1 1 e. Mr. Dileep C. Choksi 1- [6] Corporate Social Responsibility [7] Risk Management Committee: Committee: As stipuated euatio of the isti The Corporate Social Responsibility (CSR) Regulations, the Board constituted a Risk Committee comprises Mrs. Manju D. Gupta, aaeet Coittee coprisi r aa Chairperso r aa hara s iita upta Sharma, Vice Chairman, Ms. Vinita Gupta, Chief Mr. Nilesh Deshbandhu Gupta and Mr. Dileep C. Executive Officer r iesh eshadhu upta Chosi rs au upta ad r aa Managing Director and Mr. Sunil Makharia, President hara are oExecutive irectors s iita upta - Finance. Mr. R. V. Satam, Company Secretary, acts ad r iesh eshadhu upta are Executive as the Secretary of the Committee. The Company Directors and Mr. Dileep C. Choksi is Independent has a structured approach for handling risks. It has Director. The composition of the Committee is in in place a Risk Management framework which copiace ith the provisios of ectio of dees roes ad resposiiities at differet the Act. The terms of reference of the CSR broadly levels. Risk Management team reviews the overall coprises riss ad ideties the critica riss that atter  Monitoring the Corporate Social Responsibility The Committee reviews at regular intervals the overall oic risks at company level and ensures that it has a robust monitoring mechanism along with adequate  Recommending and approving the amount of mitigation plans for the critical ‘risks that matter’ expediture icurred o C activities to e based on their probability of occurrence, potential impact and volatility.

LUPIN LIMITED | ANNUAL REPORT 2019-20 91 Details of the Risk Management Committee The performance evaluation was carried out based Meeting on parameters, such as initiative, contributions, Meeting of the Risk Management Committee was independent judgement, understanding the hed o eruar attedace at hich as as business environment and understanding of uder strategic issues. Independent Directors are a diversied roup of recoised professioas Sl. No. of Meetings Name of the director with wide horizon of knowledge, competence and No. Held Attended iterit ho express their opiios free ad a. r aa hara 1 1 exercise their o udeets i decisioai b. Ms. Vinita Gupta 1 1 c. Mr. Nilesh Deshbandhu Gupta 1 1 Overseas Independent Directors have international d. Mr. Sunil Makharia 1 1 perspectives and bring them to bear upon during oard deieratios here ere o coicts of [8] Independent Directors’ Meeting: interest of Independent Directors with the Company. copiace ith the provisios of ectio Independent Directors include Mr. R. A. Shah, an read with Clause VII of Schedule IV of the Act and eminent Solicitor with high legal acumen and valuable euatio of the isti euatios a experiece of deai ith are doestic ad meeting of the Independent Directors was convened utiatioa copaies r ada a reputed o eruar he eeti as atteded economist-cum-development banker, having wide r A hah r ichard ah r ada ad experiece of hadi copa aaeets Ms. Christine Mundkur. Mr. Shah chaired the meeting, ad proect deveopet across diverse idustries which was held without the presence of any and Mr. Dileep C. Choksi, an eminent Chartered non-independent director. The Independent Directors Accoutat ith o experiece i cosuti reviewed the performance of the Chairperson of advisi are copaies o taxatio aaeet the Company, non-independent directors and the ad copex acia issues r ichard ah Board as a whole. They appreciated the detailed r eauc eiard ad s Christie udur presentations made by Ms. Vinita Gupta, Chief having worked at the highest levels, with Executive Officer ad r iesh eshadhu upta internationally-renowned pharmaceutical companies, Managing Director at Board meetings, which inter provide strategic inputs on operational plans of the alia covered business operations, growth plans, Company. regulatory challenges, inorganic initiatives, budgets, [10] Familiarisation Program for R&D pipeline, etc. They also appreciated the detailed Independent Directors: presetatios o uarterear acia resuts The Company regularly familiarizes its Independent he depedet irectors expressed satisfactio irectors throuh differet proras hich about the Board creating an environment for the provides them with an in-depth understanding of depedet irectors to participate effective the Company and the pharma industry, which is in They appreciated the overall functioning of the copiace ith euatio of the isti Board, adequacy of evaluation process, openness Regulations. An Independent Director is issued of the Board deliberations on business issues and a formal letter of appointment which inter-alia the Agenda items. The Independent Directors covers terms and conditions of appointment, expressed satisfactio aout the uait adeuac roles, functions, rights, duties and responsibilities. ad tieiess of the o of iforatio fro the he Copa r eieves that oede aout Management. They noted the fact that the Board the latest developments in the pharma industry eeti dates ere aied i cosutatio ith should be shared with the Directors to enable them a irectors ad reuisite dataiforatio fored to participate effective resetatios are ade part of Board agenda which facilitated meaningful at eetis of irectors o Copas acia discussions at meetings. The Independent Directors business unit-wise performance, environment, health suggested that the management should focus on and safety measures undertaken at various plant Global Quality operations and broaden the product locations. Independent Directors are familarised with basket in the US. The management took note of the business strategies, operations, policies, procedures, valuable suggestions made by Independent Directors. fuctios ris assessetris iiiatio [9] Performance evaluation of Independent procedures and business model of the Company Directors: and its subsidiaries. Press Releases are circulated As stipuated uder euatio of the isti to Independent Directors and they are regularly Regulations, the Board carried out performance appraised about material information disseminated evaluation of Independent Directors without to the toc Exchaes depedet irectors have participation of the Director being evaluated. access to the Company information and freedom to

92 Corporate Overview Statutory Reports Financial Statements

interact with the Senior Managerial personnel of the Company. Independent Directors are invited to attend Aua vestors eets hich provide the opportuities to iteract ith aasts ivestors ad acia advisors As adated euatio of the isti euatios the aiiarisatio rora foruated the Company for Independent Directors has been hosted on the Company’s website www.lupin.com web link for hich is httpsupicopdfcorporatepoiciesfaiiarisatioproraepdf [11] General Body Meetings: etais of the ast three Aua eera eetis

Day, Date Year Location No. of Special Resolutions passed and Time 2016 - 17 Wednesday, Rang Sharda Oe pecia esoutio as passed for rati oas ador providi August 2, 2017, Natyamandir, uarateessecurities ador ai ivestets for aouts exceedi at 2.30 p.m. Bandra Reclamation, of the paidup share capita free reserves ad securities preiu Bandra (West), accout or of free reserves ad securities preiu accout ut Mumbai - 400 050. ot exceedi ` 50000 million over and above the aggregate of free reserves and securities premium account. 2017-18 Wednesday, Rang Sharda One Special Resolution was passed for keeping the Register of Members August 8, 2018, Natyamandir, ad other reistersrecords of the Copa aitaied uder ectio at 2.30 p.m. Bandra Reclamation, of the Act ad copies of the Aua returs ed uder ectio of Bandra (West), the Act at i tie vt td C ar ar ihroi est Mumbai - 400 050. Mumbai- 400 083, Registrar & Share Transfer Agent, instead of the eistered Office of the Copa 2018-19 Wednesday, Rang Sharda o pecia esoutios ere passed August 7, 2019, Natyamandir, 1) or odifi the upi usidiar Copaies Epoees toc at 2.30 p.m. Bandra Reclamation, Optio a to icrease the axiu uer of euit shares Bandra (West), of the Company (of face value of ` each that a e issued Mumbai - 400 050. pursuat to exercise of optios rated to eiie epoees uder this Plan by an additional 400,000 equity shares (i.e. from 1,125,000 to 1,525,000 equity shares). 2) or odifi the upi Epoees toc Optio a to reduce the axiu uer of euit shares of the Copa of face vaue of ` each that a e issued pursuat to exercise of optios granted to eligible employees under this Plan by 400,000 equity shares (i.e. from 3,375,000 to 2,975,000 equity shares).

No business was required to be transacted through postal ballot at the above meetings.

At the Extraordiar eera eeti E hed o [12] Related party transactions and other oda eceer the eers vide a pecia disclosures: esoutio passed ith a aorit of approved uri the acia ear a reated part trasactios the divestment of entire interest of the Company in entered by the Company were in the ordinary course oa haraceutica dustr Co iited apa of business and on arm’s length pricing basis. a step-down material subsidiary of the Company. As stipuated ectios iv ad of the Ms. Neena Bhatia, Practising Company Secretary, Act ad euatio of the isti euatios acted as Scrutiniser for conducting the EGM in a fair statements of transactions with related parties were and transparent manner. Procedures prescribed by placed periodically before the Meetings of the Audit ectios ad of the Act read ith ue of Committee and approved. The Company entered the Companies (Management & Administration) Rules, into material related party transactions only with its as aeded the Copaies aaeet susidiaries o reated part trasactios coicted Adiistratio Aedet ues ere fooed with the interests of the Company. for conducting the EGM. The Company provided e-voting facility to Members through the e-voting platform of copiace ith ue A of the Copaies i tie dia vt td eistrar ad hare rasfer eetis of oard ad its oers ues ad Agent of the Company. Results of the EGM together with euatio of the isti euatios the Audit the Scrutiniser’s Report were published in newspapers Committee granted requisite omnibus approvals and hosted on the Company’s website www.lupin.com. to transactions which were likely to be entered into by the Company with related parties during the

LUPIN LIMITED | ANNUAL REPORT 2019-20 93 acia ear he Coittee revieed o a indicating very strong degree of safety regarding quarterly basis, details of transactions entered by the tie paet of acia oiatios Company pursuant to each of the omnibus approval [14] Fees paid to Statutory Auditors: given. ursuat to chedue C of the isti copiace ith euatio of the isti euatios duri the Copa ad its euatios r eauc eiard depedet subsidiaries paid a consolidated sum of ` iio irector of the Copa is o the oards of upi to Co Chartered Accoutats ir e haraceuticas c A ad upi Atatis o tatutor Auditors ad a Hodis A iterad hooed ateria entities in its network globally. subsidiaries of the Company. The policy for [15] Means of communication: determining material subsidiaries has been ters of the isti euatios copaies are hosted o the Copas esite e i required to announce audited annual (consolidated httpsupicopdfcorporatepoicies ad stadaoe acia resuts ithi das fro policy-for-determining-material-subsidiaries.pdf). the ed of the ear Hoever due to the CO copiace ith d A detais of trasactios adeic the iistr of Corporate Affairs CA with related parties are disclosed in the notes that reaxed the said period ad peritted copaies for part of the acia stateets Apart fro to aise their audited aua acia resuts sitting fees and commission, there is no pecuniary ue Eve thouh CA exteded the said transaction with any Independent Director, which date the Copa decared its audited acia had potetia coicts of iterest ith the Copa resuts e ithi the da period oriia copiace ith euatio of the isti adated the isti euatios iacia resuts Regulations, the Company has electronically uploaded are eectroica upoaded o the isti Cetre on BSE’s online Portal - ‘BSE Corporate Compliance & E ad EA E ithi iutes of their isti Cetre isti Cetre ad Es Eectroic approval by the Board. The Company communicates Application Processing System’ (NEAPS), disclosures with its investors and stakeholders through varied of related party transactions on a consolidated basis channels of communication like annual reports, press ithi das fro the date of puicatio of its releases, hosting relevant information on its website stadaoe ad cosoidated acia resuts for the and dissemination of information on online portals half-year and the same have also been hosted on the of BSE and NSE. Shareholding pattern and corporate Company’s website www.lupin.com . overace reports are ed uarter ith the isti Cetre ad EA i ode iacia resuts are Particulars of transactions entered into by the published in the prescribed format in ‘The Economic Company with related parties, in which directors are Times’ (all editions) and Marathi translation thereof iterested are recorded i or o eister in ‘The Maharashtra Times’ (Mumbai edition) of Contracts with related party and contracts and newspapers. The website of the Company displays bodies etc.’ maintained pursuant to the provisions of officia press reeases ad presetatios ade to ectio of the Act ad ues ade thereuder investors and analysts. Unpublished price sensitive and the same are placed at Board Meetings and information is not disclosed at investors meets and signed by the Directors present. Pursuant to the presentations made to analysts. provisios of ectio of the Act ad ues ade thereuder ad euatio of the isti foratio pursuat to euatio read ith Regulations, the Company formulated a policy on art A of chedue of the isti euatios materiality of related party transactions and dealing including material information having a bearing on with related party transactions. The policy, as the perforaceoperatios of the Copa or other approved by the Board, is hosted on the Company’s price sensitive information, is promptly disclosed website www.lupin.com, web link of which is to BSE and NSE. As a good corporate practice, httpsupicopdfcorporatepoicies black-out period is announced a week before the policy-related-party-transactions.pdf . date of the oard eeti at hich acia resuts are to be considered, during which, the Directors [13] Credit Rating: and Senior Management personnel are advised not The Company has not issued any debt instrument to couicate ith ivestorsaasts ad the which necessitated a long-term credit rating. media. The policy for determining materiality of CA iited CA assied the rati ‘ICRA A1+’ events for the purpose of making disclosures to the (pronounced ‘ICRA A one Plus’) for the Company’s Exchaes as aso such discosures ade to E ad short-term credit facilities of ` iio NSE are available on the website of the Company.

94 Corporate Overview Statutory Reports Financial Statements

The Company has complied with all requirements of ivided for the ear eded arch if decared BSE, NSE, SEBI, RBI and other statutory authorities at the Aua eera eeti sha e paid to on matters relating to capital markets during the a) eecia oers at the ed of usiess da o last three years and that no penalties have been uesda Auust as per ists furished imposed nor strictures passed against the Company. ad C i respect of shares hed i ursuat to euatio of the isti euatios eectroic for ad a policy on preservation of documents and archival policy has been hosted on the website of the b) persons whose names appear on the Register of Company. Members as at the end of the business day on uesda Auust i respect of shares hed [16] General Members’ information: in physical form. INVESTORS’ SERVICES DIVIDEND PAYMENT DATE Till recently, the in-house Investors’ Services ivided if decared sha e paid ithi ve Department of the Company, managed all activities working days from the date of the Annual General related to shares of the Company. In order to avail Meeting. Dividend shall be remitted electronically i.e. of advaced softare sstes i a efficiet ad throuh ACHE etc herever a detais of costeffective aer i tie dia vt td shareholders are available with the Company and in i tie as appoited as the eistrar ad other cases, through demand drafts. Share Transfer Agent (RTA) for managing activities reated to shares of the Copa i tie are SHARES LISTED AT leaders in the corporate registry business and have he euit shares of the Copa are isted at the best of facilities and infrastructure. They have a BSE Limited (BSE) vast client-base and deploy the latest technology and hiroe eeeeho oers employ well-trained and professional team of domain Dalal Street, Mumbai Samachar Marg, experts uai e are codet that i tie i cotiue to National Stock Exchange of India Limited (NSE) render prompt services to the esteemed shareholders Exchae aa of the Company. They can be approached for any adra ura Copex query or assistance through letter, telephone, e-mail Bandra (East), or i perso at i tie dia vt td it upi uai iited C ar ar ihroi est Aua isti fees for the ear have ee uai e o ree o paid to BSE and NSE. Eai rthepdesiitiecoi STOCK CODES ANNUAL GENERAL MEETING he stoc codes of the Copa are th he Annual General Meeting (AGM) will be BSE: 500257 hed at p o edesda Auust NSE: LUPIN The meeting will be conducted through Video Cofereciother audiovisua eas pursuat INTERNATIONAL SECURITIES IDENTIFICATION to CA Circuar o dated a NUMBER (ISIN) id refer to the otice of A for ore detais a uiue ideticatio uer aotted to dematerialised scrip must be quoted in each FINANCIAL CALENDAR transaction relating to dematerialised shares of irst uarter resuts uAuust the Company. The ISIN of the equity shares of the ecod uarter resuts Octoeroveer Company is INE 326A 01037. hird uarter resuts auareruar Aua resuts Apria CORPORATE IDENTITY NUMBER (CIN) Aua eera eeti uAuust The CIN of the Company is L24100MH1983PLC029442. BOOK CLOSURE The Register of Members and the Share Transfer EXCLUSIVE E-MAIL ID FOR COMMUNICATION Register will remain closed from Wednesday, OF INVESTORS’ GRIEVANCES Auust to edesda Auust The following email ID has been designated (both days inclusive). excusive for couicati ivestors rievaces [email protected]

LUPIN LIMITED | ANNUAL REPORT 2019-20 95 MARKET PRICE DATA he aret price data coveri the ear Apri to arch is ive eo

BSE NSE MONTH (`) (`) (`) (`) High Date Low Date High Date Low Date Apr - 2019 880.75 26.04.19 740.00 01.04.19 881.35 26.04.19 740.00 01.04.19 May - 2019 882.15 02.05.19 721.50 27.05.19 884.00 02.05.19 720.00 27.05.19 u 789.90 28.06.19 697. 3 0 19.06.19 790.00 28.06.19 697. 2 0 19.06.19 u 795.00 30.07.19 724.40 08.07.19 795.00 30.07.19 725.00 08.07.19 Aug - 2019 791.40 08.08.19 711.60 30.08.19 791.40 08.08.19 711.55 23.08.19 Sep - 2019 780.00 16.09.19 702.05 30.09.19 780.00 16.09.19 702.05 30.09.19 Oct - 2019 748.05 23.10.19 646.20 07.10.19 749.50 23.10.19 646.30 07.10.19 Nov - 2019 814.95 29.11.19 715.90 08.11.19 815.00 29.11.19 715.25 08.11.19 Dec - 2019 803.65 02.12.19 738.00 11.12.19 803.45 02.12.19 737.25 11.12.19 a 786.25 03.01.20 716.20 31.01.20 786.50 03.01.20 716.00 31.01.20 Feb - 2020 738.40 06.02.20 635.30 28.02.20 738.75 06.02.20 635.20 28.02.20 Mar - 2020 685.65 05.03.20 505.00 13.03.20 686.65 05.03.20 504.75 13.03.20

DEMATERIALISATION OF SHARES AND LIQUIDITY Trading in shares of the Company is permitted only in dematerialised form and are available for trading through oth the depositories C ad euests received for deateriaisatio of shares are reuar oitored to expedite the deat process eat reuests are cored to the depositories ithi ve ori das of receipt he teratioa ecurities deticatio uer assied to the Copas shares the depositories is INE 326A 01037. Shareholders holding shares in physical form are requested to get them dematerialised. Shareholders are also requested to update their bank account details, e-mail IDs etc. for prompt disbursement of dividend amount and faster assimilation of Company information. uri the ear the Copa has eectroica cored deat reuests for euit shares As o arch of the euit share capita of the Copa as hed i deateriaised for Company’s shares are fairly liquid on the bourses and are traded actively at BSE and NSE. Trading data of the sae for the ear Apri to arch is as uder

(Value in million `) BSE NSE Total MONTH Shares Value (`) Shares Value (`) Shares Value (`) Apr - 2019 2329737 1902.04 38898387 31889.73 41228124 33791.77 May - 2019 2570706 2005.67 45277849 35232.04 47848555 37237.71 u 1302747 957.33 29673652 21868.15 30976399 22825.48 u 1238576 942.02 28771917 21900.88 30010493 22842.90 Aug - 2019 1268470 950.28 27449841 20565.72 28718311 21516.00 Sep - 2019 1223770 914.13 25313528 18920.74 26537298 19834.87 Oct - 2019 1036149 730.54 25483646 18112.13 26519795 18842.67 Nov - 2019 1647235 1266.82 45071775 34542.19 46719010 35809.01 Dec - 2019 681518 523.50 20153508 15461.19 20835026 15984.69 a 1057089 793.24 27330412 20528.88 28387501 21322.12 Feb - 2020 1343006 944.38 43210167 30237.29 44553173 31181.67 Mar - 2020 2017959 1208.36 56347682 34510.90 58365641 35719.26 Total: 17716962 13138.31 412982364 303769.84 430699326 316908.15

96 Corporate Overview Statutory Reports Financial Statements

PERFORMANCE IN COMPARISON WITH BROAD BASED INDICES upi share price copared ith E esex ad ift othed cosi duri the ear Apri to arch BSE NSE MONTH Lupin share price (`) S&P BSE Sensex Lupin share price (`) Nifty 50 Apr - 2019 870.70 39031.55 872.05 11748.15 May - 2019 745.30 39714.20 745.55 11922.80 u 755.10 39394.64 754.75 11788.85 u 764.70 37481.12 764.80 11118.00 Aug - 2019 740.25 37332.79 741.00 11023.25 Sep - 2019 715.35 38667.33 715.70 11474.45 Oct - 2019 745.65 40129.05 745.10 11877.45 Nov - 2019 800.35 40793.81 800.65 12056.05 Dec - 2019 764.90 41253.74 763.45 12168.45 a 717.90 40723.49 718.25 11962.10 Feb - 2020 639.70 38297.29 640.00 11201.75 Mar - 2020 589.70 29468.49 589.65 8597.75 EVOLUTION OF SHARE CAPITAL articuars of share capita of the Copa

Total issued Year Allotment of shares (of the face value of ` 10/- each) No. of shares during Capital at the end of the year the year (`) 2001 - 02 40141134 shares upon amalgamation* 40141134 401411340 2006 - 07 11360 shares under ESOP (Pre - Bonus) shares as ous i the ratio of 40203430 803445640 39576 shares under ESOP (Post - Bonus) 2007 - 08 1656100 shares upon conversion of FCCB 1736331 820808950 80231 shares under ESOP 2008 - 09 571069 shares upon conversion of FCCB 738655 828195500 167586 shares under ESOP 2009 - 10 5816742 shares upon conversion of FCCB 6124283 889438330 307541 shares under ESOP 2010 - 11 170691 shares under ESOP (Pre Sub-division) Allotment of shares (of the face value of ` 2/- each) 1482024 892402378 628569 shares under ESOP (Post Sub-division) 2011 - 12 440492 shares under ESOP 440492 893283362 2012 - 13 887812 shares under ESOP 887812 895058986 2013 - 14 846311 shares under ESOP 846311 896751608 2014 - 15 1112531 shares under ESOP 1112531 898976670 2015 - 16 1094634 shares under ESOP 1094634 901165938 2016 - 17 993900 shares under ESOP 993900 903153738 2017 - 18 505981 shares under ESOP 505981 904165700 2018 - 19 410847 shares under ESOP 410847 904987394 2019 - 20 504424 shares under ESOP 504424 905996242

* Aaaatio of upi aoratories iited ith upi Cheicas iited hose ae as chaed to upi iited SHARE TRANSFER SYSTEM The Board has constituted a Share Transfer Committee comprising Mrs. Manju D. Gupta, Chairperson, r aa hara ice Chaira r iesh eshadhu upta aai irector ad r ada depedet irector to approve the trasfer of shares the asece of rs au Gupta, Mr. Nilesh Deshbandhu Gupta, acts as Chairman of the Committee. Shares of the Company are traded compulsorily in dematerialised form and are transferable through the depository system. Transfer of shares in physical form are placed before the Share Transfer Committee for approva he said Coittee et ties duri the ear herei it approved trasfers of shares i physical form.

As adated euatio of the isti euatios ever six oths a Copa ecretar i practice udertaes audit of share trasfer reated activities ad issues a copiace certicate hich is suitted the Company to BSE and NSE.

LUPIN LIMITED | ANNUAL REPORT 2019-20 97 SHARE ALLOTMENT COMMITTEE The Board has constituted a Share Allotment Committee comprising Mrs. Manju D. Gupta, Chairperson, r aa hara ice Chaira ad r iesh eshadhu upta aai irector to approve the allotment of shares. In the absence of Mrs. Manju D. Gupta, Mr. Nilesh Deshbandhu Gupta, acts as Chairman of the Committee.

he Aotet Coittee et ties duri the ear herei it approved the aotet of shares areati to epoees of the Copa ad those of its susidiaries upo their exercisi vested options granted to them under various stock option Plans of the Company.

The Share Allotment Committee has authorized designated persons to comply with pre and post allotment formalities including listing of allotted shares with BSE and NSE.

UNCLAIMED SHARES As o Apri shares of sharehoders reaied outstadi as ucaied i the upi iited caied uspese Accout

uri the ear three sharehoders caied shares hich ere du trasferred the Copa i the ae of the respective caiat sharehoders after due vericatio of the cai docuets suitted the

ursuat to the provisios of ectio of the Copaies Act shares of sharehoders were transferred to the IEPF authority.

As o arch shares of sharehoders reaied i the caied uspese Accout voti rights in respect of which shall remain frozen till the claim of the rightful shareholders is approved by the Company.

SHAREHOLDING PROFILE AS ON MARCH 31, 2020 i. Distribution of Shareholding Shareholding range Shareholders Shareholding (No. of shares) Numbers % Numbers % 1 - 500 286153 95.45 18167411 4.01 501 - 1000 6653 2.22 4955947 1.09 1001 - 2000 4288 1.43 5809770 1.28 2001 - 3000 858 0.29 2147054 0.47 3001 - 4000 337 0.11 1195548 0.26 4001 - 5000 230 0.08 1073712 0.24 5001 - 10000 432 0.14 3075275 0.68 10001 and above 841 0.28 416573404 91.97 Total: 299792 100.00 452998121 100.00

ii. Shareholding Pattern As on 31.03.2020 As on 31.03.2019 Category No. of shares % No. of shares % Promoters 212566042 46.92 212545642 46.97 Mutual Funds 45914807 10.14 29020664 6.41 surace Cosasiacia stitutios 26923036 5.94 24390942 5.39 Foreign Institutional Investors (FIIs) 102749449 22.68 117062968 25.87 Foreign Bodies 5000 0.00 5000 0.00 Non Residents 2220986 0.49 2569030 0.57 Public 62618801 13.83 66899451 14.79 Total: 452998121 100.00 452493697 100.00

98 Corporate Overview Statutory Reports Financial Statements

Shareholding Pattern as on March 31, 2020

Public 13.83%

Non Residents 0.49%

Foreign Institutional Investors 22.68% Promoters 46.92%

Insurance Cos./Banks/ Financial Inst. 5.94%

Mutual Funds 10.14% iii. Shareholding Profile Demat Physical Total (Nos.) % (Nos.) % (Nos.) Shareholding 451909513 99.76 1088608 0.24 452998121 Shareholders 295926 98.71 3866 1.29 299792

Shareholding Shareholders

Physical 0.24% Physical 1.29%

Demat 99.76% Demat 98.71%

iv. Geographical spread of Shareholders Shareholders Shareholders State State Nos. % Nos. % Andhra Pradesh 15163 5.06 Madhya Pradesh 8016 2.67 Assam 1305 0.44 Maharashtra 100986 33.69 Bihar 2284 0.76 North Eastern States 286 0.10 Chhattisgarh 1203 0.40 Orissa 2608 0.87 Delhi 17418 5.81 Punjab 4846 1.62 Goa 601 0.20 Rajasthan 10116 3.37 Gujarat 36690 12.24 Tamil Nadu 17356 5.79 Haraa 6588 2.20 Telangana 343 0.11 Hiacha radesh 635 0.21 Uttarakhand 4997 1.67 au ad ashir 601 0.20 Uttar Pradesh 13329 4.45 harhad 4093 1.37 West Bengal 19394 6.47 arataa 20849 6.95 Others 3606 1.20 eraa 6479 2.16 Total: 299792 100.00

LUPIN LIMITED | ANNUAL REPORT 2019-20 99 DIVIDEND PROFILE articuars of divided decared the Copa

Book closure/ Date of Date of Financial year Dividend % Dividend per share (`) Record date declaration payment 2018 - 19 31.07.19 - 07.08.19 250 5.00 07.08.2019 13.08.2019 2017 - 18 01.08.18 - 08.08.18 250 5.00 08.08.2018 13.08.2018 2016 - 17 26.07.17 - 02.08.17 375 7. 5 0 02.08.2017 05.08.2017 2015 - 16 27.07.16 - 03.08.16 375 7. 5 0 03.08.2016 06.08.2016 2014 - 15 16.07.15 - 23.07.15 375 7. 5 0 23.07.2015 27.07.2015 2013 - 14 (Final) 23.07.14 - 30.07.14 150 3.00 30.07.2014 31.07.2014 2013 - 14 (Interim) 14.02.14 150 3.00 03.02.2014 21.02.2014 2012 - 13 31.07.13 - 07.08.13 200 4.00 07.08.2013 08.08.2013 2011 - 12 17.07.12 - 24.07.12 160 3.20 24.07.2012 25.07.2012 2010 - 11 20.07.11 - 27.07.11 150 3.00 27.07.2011 28.07.2011 2009 - 10 21.07.10 - 28.07.10 135 13.50 28.07.2010 29.07.2010 2008 - 09 22.07.09 - 29.07.09 125 12.50 29.07.2009 30.07.2009 2007 - 08 15.07.08 - 22.07.08 100 10.00 22.07.2008 23.07.2008 2006 - 07 12.07.07 - 19.07.07 50 5.00 19.07.2007 20.07.2007 2005 - 06 11.07.06 - 12.07.06 65 6.50 25.07.2006 26.07.2006 2004 - 05 19.07.05 - 20.07.05 65 6.50 28.07.2005 29.07.2005 2003 - 04 15.07.04 - 16.07.04 65 6.50 29.07.2004 30.07.2004 2002 - 03 17.07.03 - 18.07.03 50 5.00 06.08.2003 07.08.2003 2001 - 02 (Final) 20.08.02 - 21.08.02 25 2.50 02.09.2002 03.09.2002 2001 - 02 (Interim) 07.02.02 25 2.50 17.01.2002 15.02.2002

Notes: 1. ivided for the acia ear oards as o the ehaced euit share capita coseuet to the ous ssue i the ratio of 2. Effective Auust the face vaue of the euit share as reduced fro ` each to ` each CODE OF CONDUCT FOR PREVENTION OF share capital of the Company is conducted for each INSIDER TRADING calendar quarter, by a practicing Company Secretary, The Company has adopted a Code of Conduct with a view to reconcile the total admitted capital pursuant to the provisions of the SEBI (Prohibition ith ad C ad those hed i phsica for of sider radi euatios euatios with the total issued, paid up and listed capital of the which has been designed to maintain highest ethical Company. standards. The Code which is applicable to Designated The Reconciliation of Share Capital Audit Report, inter Persons and their immediate relatives, elaborately aia cors that the eister of eers is du prescribes the procedures to be followed while dealing updated ad that deatreat reuests ere du in shares of the Company. cored to the depositories ithi the stipuated The Code restricts the said persons in dealing with time. Details of changes in the share capital during the the shares of the Company while in the possession of quarter are also covered in the said Report. any unpublished price sensitive information. They are The said Report is submitted to BSE and NSE and is also prohibited from dealing in shares of the Company also placed at meetings of the Board of Directors and during the trading window closure periods announced the Stakeholders’ Relationship Committee. by the Company, from time to time. The Code has been disseminated through the Company’s intranet UNCLAIMED DIVIDENDS for easy access and increased awareness. Dividends declared by the Company up to the acia ear hich reaied ucaied The Company also follows the ‘Code of Practices unpaid were transferred to the Investor Education and Procedures for Fair Disclosure of Unpublished and Protection Fund (IEPF), pursuant to the relevant Price Sensitive Information’ as envisaged by the provisions, as and when the same were due. Regulations, which is hosted on the Company’s website. In the interest of its esteemed shareholders, the Company sends personalized reminders to the RECONCILIATION OF SHARE CAPITAL AUDIT shareholders concerned to claim their unpaid REPORT dividends, from time to time and also before ters of Cause of the E epositories transferring the same to IEPF. ad articipats euatios a audit of the

100 Corporate Overview Statutory Reports Financial Statements

caiedupaid divideds for the ear viii) Block 21, Dabhasa, Padra Taluka, Vadodara, oards i e trasferred to the E as uder Gujarat - 391 440. ix) Plots Nos. M-1, M-2, M-2A and M-3-A, Special Date of Due date for Economic Zone, Phase - II, Misc. Zone, Apparel Park, Financial Year Declaration transfer to IEPF Pithampur, Dist. Dhar, Madhya Pradesh - 454 775. 2012 - 13 07.08.2013 12.09.2020 x) Plot 6A1, 6A2 and 6B, Sector-17, Special Economic 2013 - 14 (Interim) 03.02.2014 11.03.2021 oe iha otied Area apur 2013 - 14 (Final) 30.07.2014 04.09.2021 Maharashtra - 441 108. 2014 - 15 23.07.2015 28.08.2022 xi) ot oad hara Cit arada 2015 - 16 03.08.2016 08.09.2023 Visakhapatnam, Andhra Pradesh - 531019. 2016 - 17 02.08.2017 07.09.2024 xii) th ie hase ararehase oc 2017 - 18 08.08.2018 13.09.2025 Duga Ilaka, East Sikkim, Sikkim - 737132. 2018 - 19 07.08.2019 12.09.2026 xiii) ove aoratories c Capus rive oerset Shareholders are advised to check their records and e erse A claim dividend before the due date of transfer to IEPF, xiv) aoratorios ri A de C odriue aro Co e ae exico C if not already encashed. C OUTSTANDING GDRs/ADRs/WARRANTS/ xv) eduiica dustria araceutica A A EAO AACA airro istrito dustria CONVERTIBLE INSTRUMENTS ui de ora ias erais CE rai The Company has granted stock options to its employees and those of its subsidiaries under ADDRESS FOR CORRESPONDENCE various employee stock option plans. Pursuant to the eers a address their ueriescouicatios provisios of E hare ased Epoee eets to euatios ad the ters ad coditios Registrar and Share Transfer Agent of the respective plans, the Company allots equity i tie dia vt td shares from time to time, upon the employees it upi iited exercisi the vested optios he Copa has C ar ar ot issued a A here are o outstadi Vikhroli (West), warrants and convertible instruments. uai PLANT LOCATIONS e he Copas pats are ocated at o ree o Eai rthepdesiitiecoi i) T-142, MIDC Industrial Estate, Tarapur Industrial Area, Boisar, Dist. Thane, Maharashtra - 401 506. ii) 198-202, New Industrial Area II, Mandideep, Dist. Raisen, Madhya Pradesh - 462 046. For and on behalf of the Board of Directors iii) 124, GIDC Industrial Estate, Ankleshwar, Gujarat - 393 002. Nilesh Deshbandhu Gupta iv) A C Area Chiathaa Auraaad Maharashtra - 431 001. Managing Director v) B-15, Phase I-A, Verna Industrial Area, Verna Salcette, Goa - 403 722. Mumbai, May 28, 2020 vi) E CO dustria Copex ari rahaa au vii) Gat No. 1156, Village Ghotawade, Taluka Mulshi, Dist. Pune, Maharashtra - 411 042.

LUPIN LIMITED | ANNUAL REPORT 2019-20 101 CERTIFICATE PURSUANT TO REGULATION 17(8) OF THE SEBI LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS REGULATIONS, 2015

e r iesh eshadhu upta aai irector ad r aesh aiatha Executive irector oa CO Head Corporate Affairs do here certif to the oard that

(a) e have revieed the iacia tateets ad the Cash o tateet for the ear eded arch ad that to the est of our oede ad eief

(i) the said statements do not contain any materially untrue statements or omit any material fact, or cotai stateets that iht e iseadi ad

(ii) the said stateets toether preset a true ad fair vie of the Copas affairs ad are i copiace ith existi accouti stadards appicae as ad reuatios

(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which are fraudulent, illegal or violative of the Company’s code of conduct.

(c) e accept resposiiit for estaishi ad aitaii itera cotros for acia reporti ad that e have evauated the effectiveess of the itera cotro sstes of the Copa pertaii to acia reporti ad have discosed to the Auditors ad the Audit Coittee deciecies i the desi or operation of such internal controls, if any, of which we are aware and the steps we have taken or propose to tae to rectif these deciecies

(d) e have idicated to the Auditors ad the Audit Coittee (i) siicat chaes i itera cotro over acia reporti duri the ear if a (ii) siicat chaes i accouti poicies duri the ear if a ad that the sae have ee discosed i the otes to the acia stateets ad

(iii) istaces of siicat fraud of hich e have ecoe aare ad the ivoveet therei if a of the aaeet or a epoee havi a siicat roe i the Copas itera cotro sste over acia reporti

For LUPIN LIMITED For LUPIN LIMITED

NILESH DESHBANDHU GUPTA RAMESH SWAMINATHAN MANAGING DIRECTOR EXECUTIVE DIRECTOR, GLOBAL CFO & HEAD CORPORATE AFFAIRS

Mumbai, May 28, 2020

DECLARATION FOR COMPLIANCE WITH THE CODES OF CONDUCT

here decare that a the irectors ad the eior aaeet of the Copa have affired copiace ith the Codes of Conduct as applicable to them for the year ended March 31, 2020.

For LUPIN LIMITED

NILESH DESHBANDHU GUPTA MANAGING DIRECTOR

Mumbai, May 28, 2020

102 Corporate Overview Statutory Reports Financial Statements

INDEPENDENT AUDITOR’S CERTIFICATE ON COMPLIANCE WITH THE CORPORATE GOVERNANCE REQUIREMENTS UNDER SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2015.

To the Members of Lupin Limited 1. his certicate is issued i accordace ith the ters of our eaeet etter dated Octoer ith addedu to our Eaeet etter dated a 2. his report cotais detais of copiace of coditios of corporate overace upi iited the Copa for the ear eded arch as stipuated i reuatios to cause to i of reuatio ad pararaphs C ad E of chedue of the ecurities ad Exchae oard of dia isti Oiatios ad iscosure euireets euatios as aeded fro tie to tie isti euatios pursuat to the isti Areeet of the Copa ith the atioa toc Exchae iited ad the oa toc Exchae iited coective referred to as the toc Exchaes Management’s Responsibility for compliance with the conditions of Listing Regulations 3. The compliance with the terms and conditions contained in the Corporate Governance is the responsibility of the Management of the Company including the preparation and maintenance of all relevant supporting records and documents. Auditor’s Responsibility 4. Our exaiatio as iited to procedures ad ipeetatio thereof adopted the Copa for esuri the copiace of the coditios of Corporate overace t is either a audit or a expressio of opiio o the acia stateets of the Copa 5. ursuat to the reuireets of the isti euatios it is our resposiiit to provide a reasoae assurance whether the Company has complied with the conditions of Corporate Governance as stipulated i the isti euatios for the ear eded arch 6. e coducted our exaiatio i accordace ith the uidace ote o eports or Certicates for pecia urposes evised the uidace ote issued the stitute of Chartered Accoutats of dia (‘ICAI’). The Guidance Note requires that we comply with the ethical requirements of the Code of Ethics issued by ICAI. 7. We have complied with the relevant applicable requirements of the Standard on Quality Control (SQC) uait Cotro for irs that erfor Audits ad evies of Historica iacia foratio ad Other Assurance and Related Services Engagements. Opinion 8. our opiio ad to the est of our iforatio ad accordi to expaatios ive to us e certif that the Company has complied with the conditions of Corporate Governance as stipulated in the aoveetioed isti euatios 9. We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiec or effectiveess ith hich the aaeet has coducted the affairs of the Copa Restriction on use 10. he certicate is addressed ad provided to the eers of the Copa soe for the purpose to eae the Copa to cop ith the reuireet of the isti euatios ad it shoud ot e used a other person or for any other purpose. Accordingly, we do not accept or assume any liability or any duty of care for a other purpose or to a other perso to ho this certicate is sho or ito hose hads it may come without our prior consent in writing.

For B S R & Co. LLP Chartered Accountants irs eistratio o

Venkataramanan Vishwanath Partner eership o CA AAAAC Mumbai, May 28, 2020

LUPIN LIMITED | ANNUAL REPORT 2019-20 103 Business Responsibility Report

he Copa r eieves i ivi ac to the couities it serves A the sectios of the societ shoud ourish has ee the Copas atra ursuat to euatio f of the E isti Oiatios ad iscosure euireets euatios the Copa has prepared the usiess esposiiit eport as uder Section A: General Information about the Company 1. Corporate Identity Number (CIN) of the Company : HC 2. Name of the Company : upi iited 3. Registered address : apataru spire rd Floor, Off ester Express Hiha atacru East uai

4. Website : www.lupin.com 5. E-mail id : hosecretariaupico 6. Financial Year reported : ear eded arch 7. Sector(s) that the Company is engaged in (industrial activity code-wise):

Industrial Group Description 210 Manufacture of Pharmaceuticals As per National Industrial Classification - Ministry of Statistics and Programme Implementation.

8. List three key products/services that the Company manufactures/provides (as in balance sheet): Diabetology, Cardiovascular and Respiratory Drugs.

9. Total number of locations where business activity is undertaken by the Company: a. Number of International Locations: he Copa has iteratioa susidiaries ocated i coutries ad a oit eture i apa he Copa has epresetative Offices i Chia aar ad ieta Offices i ussia raie ad aahsta are uder process of iuidatio he Copa has three aufacturi pats ocated i countries. The Company also has research facilities in the USA and the Netherlands.

b. Number of National Locations: he Copa has aufacturi pats situated at Auraaad arapur ue ad apur i Maharashtra, Ankleshwar and Dabhasa in Gujarat, Mandideep and Pithampur in Madhya Pradesh, isahapata i Adhra radesh ii oa ad au he ai Cetre is ocated at ue he eistered office is i uai he Copa has Carri orardi Aets ie Cetra Warehouses and seven Consignee Agents across the country.

10. Markets served by the Company - Local/State/National/International: additio to servi the dia aret the Copa exports to aroud coutries ordide

104 Corporate Overview Statutory Reports Financial Statements

Section B: Financial Details of the Company

1. Paid up Share Capital ` iio to provide quality education. The Company understands the limitation of a single 2. Total Turnover ` iio corporate organization to overhaul the (Standalone) sste Hece the focus is ore o 3. Total Profit after Taxes ` iio deveopi ode schoosaaadis that (Standalone). will inspire and bring about the change. he efHep roups are efficiet aaed 4. Total spending on Corporate Social Responsibility and were instrumental in empowering women (CSR) as percentage of profit after tax(%): and uplifting their position in the household The total CSR spend for the year was ` iio and in the communities they live. hich is of the averae et prot of the Company for the last three years calculated in c. Natural Resource Management accordace ith the provisios of ectio of The management of natural resources is the Copaies Act done through various measures such as construction of check dams, farm ponds, 5. List of activities in which expenditure in 4 above dii e es deepeirepairi has been incurred: existi es With a holistic approach, the Company’s CSR arm upi Hua efare ad esearch oudatio d. Rural Infrastructure Development H focuses o theatic areas Ecooic Water, sanitation, housing, education and Social, Natural Resource Management (NRM), health are inter-related and adequate ura frastructure eveopet ad ear ad infrastructure is necessary to maintain it. Earn. Developing rural economy includes a family The Company’s intervention in this sector was centered approach and initiating actions for to provide the best infrastructure. upliftment of the poor. Other areas like disaster e. Learn and Earn program relief and mitigation were taken up with a view to With an aim to provide an opportunity to attain sustainable development. In accordance deserving students, particularly from small with its CSR policy, various initiatives undertaken towns and rural areas for pursuing higher the Copa icude the fooi education with stipend or earning, the a. Economic Development Copa has i pace ear Ear prora The Company was able to unleash the value The said program is in line with the Company’s in rural economy through various activities philosophy to share and care, to nurture and meant to enhance productivity, infuse enable an inclusive growth. The purpose techoo ad diversif i varied sectors vi is to provide an opportunity to young and agriculture, animal husbandry, rural industries deserving minds to dream, dare and do what and skill enhancement. These sectoral they are capable of doing. programs led to a surge in the earnings of eeciar househods i the area uder Section C: Other Details operation. 1. Does the Company have Subsidiary Companies? b. Social Development As o arch the Copa had With an objective to ensure progress in subsidiaries. the sectors of health and education, social development is undertaken simultaneously 2. Do the Subsidiary Companies participate in the with economic development. Over the years, BR Initiatives of the parent company? If yes, H has cotiuous copieted then indicate the number of such subsidiary the government health infrastructure and companies: their efforts to achieve heathreated Of the susidiaries are icorporated outcomes such as reducing infant mortality outside India, which comply with the requirements rate ad atera ortait rate H is of their respective countries and have implementing partner of Integrated Child independent business responsibility initiatives. Development Scheme and its performance upi Heathcare iited the o dia has been validated by independent agencies. subsidiary has not commenced commercial O the educatio frot H has over operations. the years strengthened the infrastructure

LUPIN LIMITED | ANNUAL REPORT 2019-20 105 3. Do any other entity/entities (e.g. suppliers, distributors etc.) that the Company does business with; participate in the BR initiatives of the Company? If yes, then indicate the percentage of such entity/ entities? [Less than 30%, 30-60%, More than 60%]: he Copas suppiers distriutors etc do ot direct participate i the iitiatives of the Copa however, they support the same.

Section D: BR Information

1. Details of Director responsible for BR: a) Details of the Director responsible for implementation of the BR policies: 1) DIN: 2) Name: Mr. Nilesh Deshbandhu Gupta 3) Designation: Managing Director b) Details of the BR head:

Sl. No. Particulars Details 1. DIN 01734642 2. Name Mr. Nilesh Deshbandhu Gupta 3. Designation Managing Director 4. Telephone No. +91 22 6640 2323 5. E-mail id hosecretariaupico

2. Principle-wise (as per NVGs) BR Policy/policies a) Details of compliance (Reply in Y/N):

Sl. Questions No. Business Ethics Responsibility Product of Well-being employees Stakeholder engagement CSR Human Rights Environment Public Policy CSR Customer Relations

P1 P2 P3 P4 P5 P6 P7 P8 P9

Y 1. Do you have YYYY(The policy YNY Y is broadly policies for. covered in various H policies and practices as also codes of conduct)

2. Has the policy YYYYYY-Y Y being formulated in consultation with the relevant stakeholders? 3. Does the policy YYYYYY-Y Y conform to any national/ The policies are broadly based on the National Voluntary Guidelines on social, international environmental and economical responsibilities of business issued by the Ministry standards? If yes, of Corporate Affairs overet of dia specify.

106 Corporate Overview Statutory Reports Financial Statements

4. Has the policy been Y Y Y Y Y Y _ Y Y

approved by the (Signed (Signed (Signed (Signed (Signed (Signed (Signed (Signed Board? by the by the by the by the by the by the by the by the MD) QA H CSR H MD CSR Marketing If yes, has it been Head Head Head Head Head Head signed by MD/CEO/ appropriate Board Director? 5. Does the Company YYYYYY-Y Y have a specified committee of the Board/Director/ Official to oversee the implementation of the policy? 6. Indicate the link * * - ** for the policy to be viewed online. 7. Has the policy YYYYYY-Y Y been formally communicated to all relevant internal and external stakeholders? 8. Does the Company YYYYYY-Y Y have in-house structure to implement the policy/policies? 9. Does the Company YYYYYY-Y Y have a grievance redressal mechanism related to the policy/ policies to address stakeholders’ grievances related to the policy/ policies? 10. Has the Company Y Y YNYY - Y Y carried out independent audit/evaluation of the working of this policy by an internal or external agency?

* httpupico httpsupiordsharepoitcositestraetei

LUPIN LIMITED | ANNUAL REPORT 2019-20 107 b) If answer to question at serial number 1 against any principle, is ‘No’, please explain why: (Tick up to 2 options)

Sl. PPPPPP P PP Questions No. 1 23456 7 89 1. The Company has ------not understood the Principles 2. The Company is not at ------a stage where it finds itself in a position to formulate and implement the policies on specified principles 3. The Company does ------not have financial or manpower resources available for the task 4. It is planned to be ------done within next 6 months 5. It is planned to be ------done within the next 1 year 6. Any other reason ----- The Company is a -- (please specify) member of various trade bodies, chambers and associations through which it has been advocating from time to time in a responsible manner, about measures to be taken by the government to address issues related to the pharmaceutical idustr Hoever o need has been felt to foruate a specic policy for the same.

3. Governance related to BR: a) Indicate the frequency with which the Board of Directors, Committee of the Board or CEO to assess the BR performance of the Company. Within 3 months, 3-6 months, Annually, More than 1 year. Annually.

b) Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How frequently it is published? he Copa does ot puish a or a ustaiaiit eport Hoever detais are provided i the Management Discussion and Analysis Report forming part of Annual Report every year.

108 Corporate Overview Statutory Reports Financial Statements

Section E: Principle-wise performance iii. ‘Tonact’ (Atorvastatin) for reducing Cholesterol. Principle 1 2. For each such product, provide the following 1. Does the policy relating to ethics, bribery details in respect of resource use (energy, water, and corruption cover only the Company? raw material, etc.) per unit of product: Yes/No. Does it extend to the Group/Joint (a) Reduction during sourcing/production/ Ventures/Suppliers/Contractors/NGOs/Others? distribution achieved since the previous year he phiosoph of the upi roup o corporate throughout the value chain? governance has been to adhere to the highest The Company manufactures and distributes standards of ethical corporate behaviour and at its world-class manufacturing facilities a fairness to stakeholders. Codes of Conduct wide range of branded formulations, generics have been adopted for Directors, Independent and active pharmaceutical ingredients. Directors and Senior Management Personnel. As consumption per unit depends on the The Company abides by well-accepted norms product ix there are o specic stadards to of ethical, moral and legal conduct in all its ascertain reduction achieved at product level. business operations and encourages and promotes a culture of intensive deliberations, (b) Reduction during usage by consumers transparency and impartiality in its dealings with (energy, water) has been achieved since the stakeholders and the public at large. It adheres previous year? to uncompromising integrity in the conduct The Company’s products do not have any of business and does not tolerate corrupt and broad-based impact on energy and water immoral practices. As a testament of its robust cosuptio cosuers Hoever the corporate governance practices and ethical Company has taken several ongoing measures conduct of business, the Company instituted to reduce consumption of water and energy. an initiative that encompasses three important 3. Does the Company have procedures in place for policies viz. Code of Conduct, Whistleblower sustainable sourcing (including transportation)? oic ad revetio of orpace Harasset If yes, what percentage of your inputs was icudi sexua harasset at orpace ith a sourced sustainably? Also, provide details view to ensure implementation of best standards thereof. of Corporate Governance, the Company provides The Company has standard operating procedures uidace to its oit veture partersvedors for approving vendors. Materials are procured from suppierscotractors ad cotiues to receive approved vendors both local as also international. their unrelenting support. The Company’s quality assurance team conducts 2. How many stakeholder complaints have been periodic audits of vendors, especially those received in the past financial year and what who supply key materials. The Company has percentage was satisfactorily resolved by the long standing business relations with regular management? If so, provide details thereof. vendors and enters annual freight contracts with The Company did not receive any complaint leading transporters for movement of materials. of sexua harasset uri the ear the The Company continues to receive unrelenting Oudsperso received copaits pertaii support from its vendors. to employment related grievances which were of 4. Has the Company taken any steps to procure minor nature. Teams of Strategic Business Unit goods and services from local and small HeadsOfficers appoited the Oudsperso producers, including communities surrounding ivestiatedexaied the copaits ad the their place of work? If yes, what steps have been same were satisfactorily resolved. taken to improve their capacity and capability of local and small vendors? Principle 2 The Company procures goods and avail services 1. List up to 3 of your products or services whose from local and small vendors, particularly those design has incorporated social or environmental located around its manufacturing locations. concerns, risks and/or opportunities. As a result of procurement of goods from local i. ‘Gluconorm’ (Metformin) an Anti-Diabetes drug. vendors, the Company saves on transportation ii. ‘Rablet’ (Rabeprazole) an Anti-Ulcer Drug for as also inventory carrying costs. The Company treatment of hyperacidity. provides technical support and guidance to vendors in developing products.

LUPIN LIMITED | ANNUAL REPORT 2019-20 109 5. Does the Company have a mechanism to 2. Please indicate the total number of employees recycle products and waste? If yes what is the hired on temporary/contractual/casual basis. percentage of recycling of products and waste as o arch (separately as <5%, 5-10%, >10%). Also, provide details thereof. 3. Please indicate the number of permanent women employees. Yes, the Company works on the philosophy of four R’s i.e. reduce, recycle, recovery and reuse. With a as o arch proactive approach, the Company continues to 4. Please indicate the number of permanent strengthen its water conservation strategies. employees with disabilities. Other than recovering and reusing of wastewater, as o arch consumption of fresh water was also reduced by recovering steam condensate and its reuse as 5. Do you have an employee association that is makeup in boilers. During the year, the Company recognized by management? has commissioned additional state-of-the-art As the Copas pats ad offices are wastewater recovery plant consisting of reverse situated at multiple places, there are unions ososis utipe effect evaporator ad aitated and associations of employees at the respective thi drer pats at oe ore site to treat locations. recover ad recce asteater Aout of the 6. What percentage of your permanent employees wastewater generated in plants was recovered, are members of this recognized employee recycled and reused directly to utilities thereby association? reducing usage of fresh water. Besides, rainwater harvesting and other conservation measures have Aout of the peraet epoees are helped to collect water which was used in place of members of recognised employee associations. fresh water. 7. Please indicate the Number of complaints relating Aout of hih caoric vaue icierae to child labour, forced labour, involuntary labour, waste generated at plants was sent for sexual harassment in the last financial year and co-processing in cement kilns and utilization pending, as on the end of the financial year. i other idustr ceet pat hih caoric No of incinerable hazardous wastes were used as a No. of complaints complaints Sl. Category filed during the pending as substitute for fossil fuels and thereby reduced No. financial year on end of the the consumption of fossil fuel both at waste financial year incineration facilities by elimination of waste for 1. Chid aour Nil, as the Company N.A. incineration. This also helped in indirectly reducing forced aour does not hire child greenhouse gas emissions. Spent solvents involuntary labour, forced generated in the API manufacturing process were labour labour or involuntary labour. also recovered in-house and reused or sent to the 2. exua Nil N.A. authoried reccers sedspet oi eerated harassment from the plants was also sent to the authorized 3. Discriminatory Nil N.A. recyclers. employment

The Company being a brand owner has initiated 8. What percentage of your under mentioned collection, recycling, co-processing and reuse of employees were given safety and skill post consumable plastic waste which is being up-gradation training in the last year? used as a packaging material for the domestic (only safety training) market. This post consumable plastic waste is (a) Permanent Employees: - Safety training is an collected from diverse parts of India and are integral part of the induction training program being channelized to generate products or as an ad is iparted to epoees i the alternate source of energy. manufacturing plants at the time of joining Principle 3 the Copa t icudes rehti rstaid 1. Please indicate the total number of employees. procedural and chemical safety, etc. While procedural safety trainings are peraet epoees i dia as o arch regularly imparted depending on the function, rehti ad rstaid traiis are ive at scheduled intervals as part of the retraining programs.

110 Corporate Overview Statutory Reports Financial Statements

(b) Permanent Women Employees: - Women was developed. With an aim to answer patient employees are provided safety training. queries related to ailments, a chatbot named ductio safet traii is iparted to AA desied to provide edica veried of all the recruited women employees in information for health-related queries was manufacturing facilities and other trainings auched he Copa deveoped the HAH ie rstaid etc are aso iparted periodica app application which provides demonstration (c) Casual/Temporary/Contractual Employees:- of Insulin administration techniques and is casuateporarcotractua helpful to diabetic patients as well as doctors. employees in operating functions are trained. The said app also provides information on diet for diabetic patients. In continuation of the (d) Employees with Disabilities: - The Company Company’s commitment towards TB eradication makes no discrimination while imparting from the country, a unique mobile app named traii to differet aed epoees visa H a oestop soutio for doctors treati vis their fellow employees. Tuberculosis, was created. The said app promotes Principle 4 HO recoeded treatet uideies for 1. Has the Company mapped its internal and as also helps clinicians to notify TB patients. external stakeholders? Yes/No. Principle 5 Yes, the Company has mapped its stakeholders. 1. Does the policy of the Company on human rights 2. Out of the above, has the Company identified cover only the Company or extend to the Group/ the disadvantaged, vulnerable and marginalized Joint Ventures/Suppliers/Contractors/NGOs/ stakeholders? Others? he Copa has idetied the disadvataed In line with the Company’s commitment to respect vulnerable and marginalized stakeholders. and protect human rights, the Company neither hires child labour, forced labour or involuntary 3. Are there any special initiatives taken by the labour nor discriminates between its employees. Company to engage with the disadvantaged, The Company’s code of conduct and the human vulnerable and marginalized stakeholders. If so, resource practices cover most of these aspects. provide details thereof. his poic exteds to the etire upi roup he Copa auched the a ovid Hepie 2. How many stakeholder complaints have been uder the taie a a aastha a i received in the past financial year and what Suraksha’ for the residents of Mumbai, Bhopal percent was satisfactorily resolved by the and Indore, which facilitates medical outreach management? to cities to resove ueries aout CO its symptoms, details about nearest testing The Company did not receive any complaint centers or government hospitals, and help for duri the acia ear i respect of vioatio of those sufferi fro stress axiet or eta human rights. health issues. The Company’s ophthalmology Principle 6 divisio upi ue Ees is associated ith 1. Does the policy related to Principle 6 cover only Eye Bank Association of India in a unique the Company or extends to the Group/Joint co-campaign called ‘Punarjyoti’ (‘Rebirth of Eyes’), Ventures/Suppliers/Contractors/NGOs/others? which promotes the noble message of pledging donation of eyes after death. Asthma detection The policy covers the Company, its subsidiaries camps are organised pan India which facilitates and all contractors working within the Company free screening of patients where chest physicians premises. are present to diagnose patients and provide 2. Does the Company have strategies/initiatives appropriate treatet Aout caps ere to address global environmental issues such as organised, at which, information on causes of climate change, global warming, etc.? Y/N. If yes, COPD and symptoms were shared with patients please give hyperlink for webpage etc. ho ere offered free piroetr diaosis The Company always accords the topmost doctor’s consultations and advised lifestyle priority to conservation and optimum utilization odicatios he Copa oraised proras of atura resources he Eviroet Heath in schools and residential societies to educate Safety and Sustainability policy of the Company parents and teachers about pediatric asthma. httpsupiordsharepoitco ephasies A dedicated utiiua esite ihtreathe on operating in environmentally responsible and to educate patients about Asthma and Allergies sustaiae aer iitiati eer efficiet

LUPIN LIMITED | ANNUAL REPORT 2019-20 111 easures i order to reduceeiiate aste  Implemented close loop system in chilled Water is a precious resource and the Company has water. a mechanism to recycle and recover wastewater  Replaced screw air compressor with in order to reduce fresh-water consumption. centrifugal air compressor. By using energy generated from non-conventional  staed eer efficiet ear oxes ad renewable sources a reduction in energy motors. consumption was achieved. The Company plans to covert its existi furace oi red oiers to  Installed auto control valves for steam atura as red oiers ext ear at oe of its utilization at furnace oil storage tank. manufacturing plants.  staed HAC ad process euipets ith variable frequency drives. 3. Does the Company identify and assess potential environmental risks? Y/N.  Replaced conventional pumps with high efficiec oes es iteraextera echaiss are i pace whereby all new facilities and products are  Installed condensing economizer and risk assessed including environmental impact pressurized economizers. assessment and development of environmental 6. Are the Emissions/Waste generated by the management plans. The said environmental Company within the permissible limits given management plans are reviewed during internal by CPCB/SPCB for the financial year being meetings. The Company received prestigious reported? International Sustainability Rating System (ISRS) Yes, and the same are monitored by both internal certicatio after audit extera idepedet as aso approved extera aecies party. The Company continues to be the only pharmaceutical industry in the world to have 7. Number of show cause/legal notices received from received the certicatio i the th edition for four CPCB/SPCB which are pending (i.e. not resolved to of its units. These sites are audited every year by satisfaction) as on end of Financial Year. the extera idepedet part here ere o uresoved sho causeea otice 4. Does the Company have any project related to received fro CCC Clean Development Mechanism? If so, provide Principle 7 details thereof, in about 50 words or so. Also, if 1. Is the Company a member of any trade and yes, whether any environmental compliance chamber or association? If Yes, Name only those report is filed? major ones that your business deals with: Yes, at one of its manufacturing sites, the The Company is a member of various trade bodies, Copa pas to covert its existi furace oi task forces and forums, chambers and associations red oiers to atura as red oiers iter aia 5. Has the Company undertaken any other (a) Federation of Indian Chambers of Commerce initiatives on - clean technology, energy ad dustr CC efficiency, renewable energy, etc. Y/N. If yes, (b) Cofederatio of dia dustr C please give hyperlink for web page etc. (c) The Associated Chambers of Commerce and oe eerefficiet ad cea techoo dustr AOCHA iitiatives carried out the Copa at differet ocatios ere as uder (d) dia haraceutica Aiace A  staed otio esors for iht ixtures (e) Indian Drugs Manufacturers Association A  staed us for copressed airportae ad puried ater (f) Bulk Drugs Manufacturers Association A  epaced C ihts ith E oes (g) haraceutica Export rootio Couci of  Installed variable frequency drive on cooling dia HAEC water pumps. (h) oa Chaer of Coerce ad dustr  Trimmed Pump impeller at utility. and  staed eusicatio sste for effective (i) ederatio of dia Export Oraisatio burning of furnace oil Boiler. (FIEO).  Replaced steam ejector with dry vacuum pump.

112 Corporate Overview Statutory Reports Financial Statements

2. Have you advocated/lobbied through  iae iroads ad above associations for the advancement or  Civic amenities Community health management. improvement of public good? Yes/No; if yes specify the broad areas (drop box: Governance Natural Resource Management and Administration, Economic Reforms, Inclusive  ater esource eveopet ad Development Policies, Energy security, Water,  Alternate Energy Development and promotion Food Security, Sustainable Business Principles, such as solar lights, biogas, biomass stoves Others). and similar green initiatives. Over the years, the Company has advocated at Disaster Relief and Mitigation various forums about measures to be taken to address basic issues pertaining to improvement  eief of public health and promote balanced as well as  ecover sustainable economic development. The Company  ehaiitatio ad supports the overet i its efforts to haress  estoratio of iveihood of the affected the country’s innovation capabilities and suggests easures to offer faciities ad icetives vi H has doe rearae or for CO encourage investments in R&D. The Company relief and transiting migrant workers. aes cotiuous efforts to proote the use 2. Are the programs/projects undertaken through of generic medicines with a view to make in-house team/own foundation/external NGO/ avaiae affordae edica treatet to the government structures/any other organization? under-privileged sections of the society. As stated earlier, the entire CSR activities of the Principle 8 Copa are ipeeted throuh H 1. Does the Company have specified programs/ t has exhaustive ad appropriate sstes i initiatives/projects in pursuit of the policy pace to effective execute C proras o related to Principle 8? If yes details thereof. the ed direct H oiises additioa he Copa estaished H i to resources from banks and government to achieve undertake rural development and implement high impact within the areas of its operations. the C prora direct H has a ost of the proects are ipeeted H presece i viaes ocated i ocs idepedet Hoever it eaes i oede of districts spread across ie states i and funding partnership with eminent academic dia H operates throuh cetres and government bodies to develop designs, he portfoio of the C activities is ive eo machines, technology to enhance productivity or ae processes easiersafer for the taret Economic Development Programme population.  Aricuture 3. Have you done any impact assessment of your  Aia Husadr initiative?  ura dustries The Company regularly conducts third party  iacia cusio impact assessments of its CSR initiatives  i eveopet ad through qualitative feedbacks collected from the eeciaries of proects evera proects are  ear ad Ear prorae undertaken in partnership with government and Social Development Programme semi-government agencies that have their own  oe epoeret monitoring mechanisms and impact assessment systems. A robust internal M & E system has been  Heath icudi Aareess ad treatet in operation. programs of Tuberculosis in rural and urban areas 4. What is your Company’s direct contribution to  Educatio ad community development projects - Amount in INR and the details of the projects undertaken?  Social Security. During the year, an amount of ` iio as Rural infrastructure Development Programme spent on various community development projects  Crossroad eveopet as aret hu for economic advancement through Education  ura Ecooic Housi and Training viz. Agricultural development, Animal husbandry, Women empowerment, Community health management, Natural

LUPIN LIMITED | ANNUAL REPORT 2019-20 113 resource management, Economic advancement 3. Is there any case filed by any stakeholder against through education and training, Promotion of the Company regarding unfair trade practices, rura idustries ear ad Ear ad isaster irresponsible advertising and/or anti-competitive management activities. behaviour during the last five years and pending as on end of financial year. If so, provide details 5. Have you taken steps to ensure that this thereof. community development initiative is successfully A stociest ased i eauru ed a case adopted by the community? before the Competition Commission of India Most of the CSR initiatives undertaken by the CC aaist the arataa ru Cheists Company are not imposed from the top but are Associatio its office earers ad the Copa designed with people’s participation right from the alleging anti-competitive arrangements. village level. Consequently, only those activities, CCI passed an Order against the parties which hich are eecia to the couit are tae as set aside i a appea ed the Copa up. Various initiatives aimed at productivity before the Competition Appellate Tribunal enhancement, livelihood development, income (COMPAT). CCI has preferred an appeal against generation, and technological infusion have struck the COMPAT Order before the Supreme Court and a chord with the rural community and have been the matter is sub-judice. accepted on a wider scale. 4. Did your Company carry out any consumer Principle 9 survey/consumer satisfaction trends? 1. What percentage of customer complaints/ The Company regularly carries out consumer consumer cases are pending as on the end of surveys at doctor level. financial year? As o arch aout of custoer complaints received during the year, were pending, For and on behalf of the Board of Directors which have since been resolved. Nilesh Deshbandhu Gupta 2. Does the Company display product information Managing Director on the product label, over and above what is mandated as per local laws? Yes/No/N.A./ Remarks (additional information). Mumbai, May 28, 2020 The Company complies with all the legal statutes regarding display of product information on labels.

114 Consolidated Financial Statements

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116 Corporate Overview Statutory Reports Financial Statements

Independent Auditor’s Report To the Members of LUPIN Limited

Report on the Audit of Consolidated euit ad cosoidated cash os for the ear the Financial Statements eded Basis for Opinion Opinion We conducted our audit in accordance with the e have audited the cosoidated acia tadards o Auditi As specied uder sectio statements of Lupin Limited (hereinafter referred to as of the Act Our resposiiities uder the “Holding Company”) and its subsidiaries (Holding those SAs are further described in the Auditor’s Company and its subsidiaries together referred to Responsibilities for the Audit of the Consolidated as “the Group”) and its joint venture, which comprise Financial Statements sectio of our report e are the cosoidated aace sheet as at arch independent of the Group and its joint venture in ad the cosoidated stateet of prot ad oss accordance with the ethical requirements that are (including other comprehensive income), consolidated reevat to our audit of the cosoidated acia statement of changes in equity and consolidated statements in terms of the Code of Ethics issued stateet of cash os for the ear the eded by the Institute of Chartered Accountants of India ad otes to the cosoidated acia stateets and the relevant provisions of the Act, and we have icudi a suar of siicat accouti poicies fued our other ethica resposiiities i accordace and other explanatory information (hereinafter ith these reuireets e eieve that the audit referred to as the cosoidated acia stateets evidence obtained by us along with the consideration In our opinion and to the best of our information and of audit reports of the other auditors referred to in according to the explanations given to us, and based the Other atters pararaph eo is sufficiet ad on the consideration of reports of other auditors on appropriate to provide a basis for our opinion on the separate acia stateets of such susidiaries ad cosoidated acia stateets joint venture as were audited by the other auditors, the aforesaid cosoidated acia stateets ive Key Audit Matters the iforatio reuired the Copaies Act Key audit matters are those matters that, in our (“Act”) in the manner so required and give a true and professioa udet ere of ost siicace i fair view in conformity with the accounting principles our audit of the cosoidated acia stateets of generally accepted in India, of the consolidated the curret period hese atters ere addressed i state of affairs of the roup ad oit veture as at the cotext of our audit of the cosoidated acia arch of its cosoidated oss ad other statements as a whole, and in forming our opinion comprehensive income, consolidated changes in thereon, and we do not provide a separate opinion on these atters

The key audit matter description How the matter was addressed in audit 1. Revenue Recognition: Refer to note 1A(m) of accounting policy and note 40 in o otai sufficiet ad appropriate audit evidece our cosoidated acia stateets principal audit procedures included, amongst others, the following: Revenue from the sale of pharmaceutical products – Comparing the accounting policies in respect of is recognized when control over goods is transferred revenue recognition and accrual for deductions from to a custoer he actua poit i tie he reveue gross sales with applicable accounting standards to is recoised varies depedi o the specic ters ensure compliance; ad coditios of the saes cotracts ith custoers he roup has a custoers operati i various ested desi ad operati effectiveess of the geographies and these sales contracts have distinct roups itera cotros icudi eera cotros terms and conditions relating to the recognition of ad e appicatio cotros over easureet of reveue the riht of retur ad price adustets accrual for deductions from gross sales; Contractual arrangements and/or local regulations – Assessing the adequacy of accruals for unsettled in various geographies result in adjustments to gross oiatios i respect of variae copoets saes price hese adustets arise fro the roups Performing retrospective test to identify any bias with obligations towards chargebacks, rebates, product respect to these estimates; recalls, medicaid, allowances, supply penalties and right of retur variae copoets Accruas are ade for unsettled obligations in respect of these variable copesatios hich reuires siicat udeet

Lupin Limited | Annual Report 2019-20 117 The key audit matter description How the matter was addressed in audit he roup routie eters ito research deveopet ad esti cotros over recoitio of reveues ith commercialization arrangements in respect of new products respect to research, development, commercialization, in the pharmaceutical sector including collaboration with icesi ad other such arraeets esti the other pharaceutica copaies his icudes iicesi recognition of revenue under the said arrangement outicesi ad other such tpe of arraeets he with focus on the terms of such arrangements in nature of these arrangements is inherently complex requiring respect to perforace oiatios esti the udet to e appied i respect of reveue recoitio accuracy of the proportion of revenue in respect of Considering the complexity of such transactions and extent ongoing performance obligations that is deferred; of judgment involved, recognition of revenue from such cotracts has aso ee cosidered as e audit atter

2. Litigation, claims and related provisions: efer to ote Ar of siicat accouti poicies ad o otai sufficiet ad appropriate audit evidece our ote i cosoidated acia stateets principal audit procedures included, amongst others, the following: he roup operates i utipe urisdictios i the pharmaceutical industry which is heavily regulated, esti the desi ad operati effectiveess resuti i icreased exposure to itiatio ris he of controls in respect of the recognition and roup is ivoved i severa itiatios ea actios measurement of provisions towards litigation and claims; hese provisios are ased o udeets ad estimates in determining the likelihood and magnitude – Examining the Group’s assessment of adequacy of of an unfavorable outcome of outstanding litigations provisions ad cais Accordi uexpected adverse outcoes ai euiries ith the ihouse ea coud siicat ipact the roups reported prot ad counsel of the group; aace sheet positio Otaii coratios fro extera ea counsels where relevant; Evaluating legal opinions obtained by the Group; Verifying correspondence, orders and appeals in respect of open litigation; Evauati siicat adustets to ea provisios recorded during the year to determine if they were indicative of bias; and – Evaluating adequacy of provisions in respect of atters uder itiatio 3. Intangible Assets: efer ote o Ad of siicat accouti poicies o otai sufficiet ad appropriate audit evidece our principal audit procedures included, amongst others, the he carri vaue of taie Assets icudi following: Process Research and Development (IPR&D) aggregate to ` iio as at arch hese assets esti the desi ad operati effectiveess of are evauated for a idicators of ipairet aua controls over impairment assessment including he roup assesses ipairet triers ith respect approval of forecasts and valuation models used; to intangible assets and IP R&D annually, at each cash – Assessing the valuation methodology used and eerati uit C eve he recoverae aout testing the mathematical accuracy of the impairment of the CGUs, being the higher of the value in use and models; fair value less costs of disposal, is compared with the carri vaue to idetif a ipairet aue i use is Assessi ideticatio of Cs ith referece to the usua derived fro discouted future cash os he guidance in the applicable accounting standards; discouted cash o ode uses severa assuptios – Evaluating the valuation assumptions, such as hese icude estiates of future saes voues prices discount rates, growth in sales, probability of success operational and selling costs, terminal value growth of e products operati ad sei costs used rates, potential product obsolescence, new product Consideration of the impact of economic slowdown auches ad the eihted averae cost of capita he caused Covid padeic o these assuptios ie ipact the Covid padeic o these ca aso icrease the ucertait ivoved i these estiates erfori sesitivit aasis of e assuptios hese icude future reveue roth rates reated Considering the inherent uncertainty, complexity and costs and the discount rate applied in the valuation udet ivoved ad the siicace of the vaue of models; the assets, impairment assessment of intangible assets has ee cosidered as a e audit atter – Evaluating past performances where relevant and historical accuracy of the forecasts made ; – Considering the impact of any adjusting events after the balance sheet date but before the reporting on the carrying values of the assets;

118 Corporate Overview Statutory Reports Financial Statements

The key audit matter description How the matter was addressed in audit 4. Uncertain tax positions: (UTPs) he roup is suect to copexities arisi fro various o otai sufficiet ad appropriate audit evidece our tax positions on deductibility of expenses as well as principal audit procedures included, amongst others, the aoaiit of tax icetives exeptios hese are following: subject to periodic challenges by local tax authorities esti the desi ad operati effectiveess of the eadi to protracted itiatios here are a uer of cotros over ascertaii copeteess of s open tax matters under litigation with tax authorities provisions for current tax and uncertain tax positions over a uer of ears and recognition of deferred taxes; he rae of possie outcoes for provisios ad – Challenging the adequacy of related provisions cotiecies ca e ide udeet to ae certai in conjunction with tax specialists by considering judgements in respect of estimates of tax exposures and changes to business and tax legislation in key contingencies is required in order to assess the adequacy jurisdictions, making relevant enquires and reading of of tax provisio correspondence with authorities where relevant; rovisio for curret tax vauatio of s ad erifi the cacuatio for curret tax provisio recognition of deferred assets/liabilities have been Analyse movements for any release, increase or idetied as a e audit atter due to the iheret continued provision during the year; complexity in the underlying tax laws and the extent of udeet ivoved i deveopi these estiates hese – Challenging judgements regarding the recoverability matters are disclosed in note 46 to the consolidated of teporar differeces pertaii to deferred tax acia stateets aaces Exaii the forecasts ad the expected utiiatio of e teporar differeces efer ote A i siicat accouti poicies – Challenging judgments with respect to probability of outo arisi fro outstadi itiatios after considering the status of recent tax assessments, audits and enquiries, recent judicial pronouncements ad udets i siiar atters Aso cosider developments in the tax environment and outcome of past itiatios e focused our or o the jurisdictions with greatest potential exposure ivovi hiher eve of udeets 5. Disposal of Subsidiaries and Discontinued Operation: efer ote Ap i siicat accouti poicies o otai sufficiet ad appropriate audit evidece our principal audit procedures included, amongst others, the During the year, as part of its overall business strategy, following: the roup disposed its susidiaries i apa for a tota of consideration of ` iio resuti i a prot o – ested desi as e as operati effectiveess of disposal of ` iio the controls in respect for accounting and disclosure of disposal of investments and subsidiaries; We consider the accounting for this disposal, coputatio of prot o disposa ad discosure of Examined the agreement to discontinuing operations in the Group's Consolidation compare the terms and conditions to those applied by acia stateets as a e audit atter due to the the Group in accounting for the disposal; size and the complexity involved in accounting for the trasactio Identifying the net consideration and any contingent consideration; hese atters are discosed i ote to the cosoidated acia stateets to deterie the effective date of disposa Otaied ad reied o the audited acia statements of these subsidiaries audited by another auditor for determining the asset and liability position on the date of disposal; eried the accouti for disposa icudi the resutat prot o disposa ested the accurac of discosure of discotiued operations as determined by the Group and compliance with the requirements of Ind AS 105 ocurret assets hed for sae ad discotiued operatios

Other Information he Hodi Copas aaeet ad oard of irectors are resposie for the other iforatio he other iforatio coprises the iforatio icuded i the Hodi Copas aua report ut does ot icude the acia stateets ad our auditors report thereo

Lupin Limited | Annual Report 2019-20 Our opiio o the cosoidated acia stateets ability of each company to continue as a going does not cover the other information and we do not concern, disclosing, as applicable, matters related to express a for of assurace cocusio thereo going concern and using the going concern basis of accounting unless the respective Board of Directors In connection with our audit of the consolidated either intends to liquidate the Company or to cease acia stateets our resposiiit is to read the operatios or has o reaistic aterative ut to do so other information and, in doing so, consider whether the other information is materially inconsistent he respective oard of irectors of the copaies ith the cosoidated acia stateets or our included in the Group and of its joint venture is knowledge obtained in the audit or otherwise appears resposie for overseei the acia reporti to e ateria isstated f ased o the or e process of each copa have performed and based on the work done/audit Auditor’s Responsibilities for the Audit of report of other auditors, we conclude that there is a the Consolidated Financial Statements material misstatement of this other information, we Our oectives are to otai reasoae assurace are reuired to report that fact e have othi to aout hether the cosoidated acia report i this reard statements as a whole are free from material Management’s and Board of Director’s misstatement, whether due to fraud or error, and to Responsibilities for the Consolidated issue a auditors report that icudes our opiio Financial Statements Reasonable assurance is a high level of assurance, he Hodi Copas aaeet ad oard but is not a guarantee that an audit conducted in of Directors are responsible for the preparation accordance with SAs will always detect a material ad presetatio of these cosoidated acia isstateet he it exists isstateets ca arise statements in term of the requirements of the Act from fraud or error and are considered material if, that give a true and fair view of the consolidated state individually or in the aggregate, they could reasonably of affairs cosoidated oss ad other coprehesive e expected to iuece the ecooic decisios income, consolidated statement of changes in of users taken on the basis of these consolidated euit ad cosoidated cash os of the roup acia stateets including its joint venture in accordance with the As part of an audit in accordance with SAs, we accounting principles generally accepted in India, exercise professional judgment and maintain including the Indian Accounting Standards (Ind AS) professioa septicis throuhout the audit e aso specied uder sectio of the Act he respective Management and Board of Directors of the companies detif ad assess the riss of ateria included in the Group and of its joint ventures are isstateet of the cosoidated acia responsible for maintenance of adequate accounting statements, whether due to fraud or error, design records in accordance with the provisions of the and perform audit procedures responsive to Act for safeguarding the assets of each company those risks, and obtain audit evidence that is and for preventing and detecting frauds and other sufficiet ad appropriate to provide a asis for irregularities; the selection and application of our opiio he ris of ot detecti a ateria appropriate accounting policies; making judgments misstatement resulting from fraud is higher and estimates that are reasonable and prudent; than for one resulting from error, as fraud may and the design, implementation and maintenance involve collusion, forgery, intentional omissions, of adeuate itera acia cotros that ere misrepresentations, or the override of internal operati effective for esuri accurac ad cotro completeness of the accounting records, relevant to Otai a uderstadi of itera cotro the preparation and presentation of the consolidated relevant to the audit in order to design acia stateets that ive a true ad fair vie audit procedures that are appropriate in the and are free from material misstatement, whether circustaces der sectio i of the Act due to fraud or error, which have been used for the we are also responsible for expressing our opinion purpose of preparatio of the cosoidated acia o the itera acia cotros ith referece statements by the Management and Directors of the to the cosoidated acia stateets ad the Hodi Copa as aforesaid operati effectiveess of such cotros ased o prepari the cosoidated acia stateets our audit the respective Management and Board of Directors Evauate the appropriateess of accouti of the companies included in the Group and of its policies used and the reasonableness of joint ventures are responsible for assessing the

Corporate Overview Statutory Reports Financial Statements

accounting estimates and related disclosures of the audit ad siicat audit dis icudi ade the aaeet ad oard of irectors a siicat deciecies i itera cotro that e idetif duri our audit Cocude o the appropriateess of aaeet and Board of Directors use of the going concern We also provide those charged with governance with basis of accounting in preparation of consolidated a statement that we have complied with relevant acia stateets ad ased o the audit ethical requirements regarding independence, and to evidence obtained, whether a material uncertainty communicate with them all relationships and other exists related to events or conditions that may matters that may reasonably be thought to bear cast siicat dout o the appropriateess on our independence, and where applicable, related of this assuptio f e cocude that a safeuards material uncertainty exists, we are required to From the matters communicated with those charged draw attention in our auditor’s report to the with governance, we determine those matters reated discosures i the cosoidated acia that ere of ost siicace i the audit of the statements or, if such disclosures are inadequate, cosoidated acia stateets of the curret to odif our opiio Our cocusios are ased period ad are therefore the e audit atters on the audit evidence obtained up to the date We describe these matters in our auditors’ report of our auditors report Hoever future evets unless law or regulation precludes public disclosure or conditions may cause the Group and its joint about the matter or when, in extremely rare veture to cease to cotiue as a oi cocer circumstances, we determine that a matter should not Evauate the overa presetatio structure ad be communicated in our report because the adverse cotet of the cosoidated acia stateets consequences of doing so would reasonably be including the disclosures, and whether the expected to outeih the puic iterest eets of cosoidated acia stateets represet the such couicatio underlying transactions and events in a manner Other Matters that achieves fair presetatio e did ot audit the acia stateets acia Otai sufficiet appropriate audit evidece iforatio of susidiaries hose acia reardi the acia iforatio of such etities stateetsacia iforatio reect tota assets or business activities within the Group and its joint of ` iio as at arch tota venture to express an opinion on the consolidated revenues of ` iio ad et cash ios acia stateets e are resposie for the amounting to (` iio for the ear eded o direction, supervision and performance of the that date as cosidered i the cosoidated acia audit of acia iforatio of such etities stateets he cosoidated acia stateets icuded i the cosoidated acia stateets aso icude the roups share of et prot ad other of hich e are the idepedet auditors or the comprehensive income) of ` iio for the ear other entities included in the consolidated eded arch i respect of oe oit veture acia stateets hich have ee audited hose acia stateetsacia iforatio have by other auditors, such other auditors remain ot ee audited us hese acia stateets responsible for the direction, supervision and acia iforatio have ee audited other perforace of the audits carried out the auditors whose reports have been furnished to us by e reai soe resposie for our audit opiio the Management and our opinion on the consolidated Our resposiiities i this reard are further acia stateets i so far as it reates to the descried i Other atters pararaph i this amounts and disclosures included in respect of these audit report subsidiaries and joint venture, and our report in terms of susectio of ectio of the Act i so far We believe that the audit evidence obtained by us as it relates to the aforesaid subsidiaries and joint along with the consideration of audit reports of venture is based solely on the audit reports of the the other auditors referred to i the Other atters other auditors pararaph eo is sufficiet ad appropriate to provide a basis for our audit opinion on the he acia stateetsacia iforatio of cosoidated acia stateets a susidiar disposed off duri the ear hose acia stateetsacia iforatio reect We communicate with those charged with governance total assets of ` i as at arch tota of the Holding Company and such other entities revenues of ` iio ad et cash out os icuded i the cosoidated acia stateets of amounting to ` iio for the ear eded o which we are the independent auditors regarding, that date as cosidered i the cosoidated acia among other matters, the planned scope and timing

Lupin Limited | Annual Report 2019-20 statements, have not been audited either by us or by necessary for the purposes of our audit of the other auditors hese uaudited acia stateets aforesaid cosoidated acia stateets acia iforatio have ee furished to us b) In our opinion, proper books of account as the Management and have been subjected to limited required by law relating to preparation of the review by another auditor and our opinion on the aforesaid cosoidated acia stateets cosoidated acia stateets i so far as it have been kept so far as it appears from our relates to the amounts and disclosures included in examination of those books and the reports of respect of the subsidiary, and our report in terms the other auditors of susectios of ectio of the Act i so far as it relates to the aforesaid subsidiary is based c he cosoidated aace sheet the soe o such uaudited acia stateets cosoidated stateet of prot ad oss acia iforatio our opiio ad accordi to (including other comprehensive income), the information and explanations given to us by the the consolidated statement of changes in aaeet these acia stateetsacia equity and the consolidated statement of iforatio are ot ateria to the roup cash os deat ith this eport are i agreement with the relevant books of account Certain of these subsidiaries and a joint venture are maintained for the purpose of preparation of ocated outside dia hose acia stateets the cosoidated acia stateets ad other acia iforatio have ee prepared in accordance with accounting principles generally d) In our opinion, the aforesaid consolidated accepted in their respective countries and which acia stateets cop ith the d A have been audited by other auditors under generally specied uder sectio of the Act accepted auditing standards applicable in their e O the asis of the ritte represetatios respective coutries he Copas aaeet received from the directors of the Holding has coverted the acia stateets of such Copa as o arch tae o subsidiaries and joint venture located outside India record by the Board of Directors of the from accounting principles generally accepted in their Holding Company and the reports of the respective countries to accounting principles generally statutory auditors of its subsidiary company accepted i dia e have audited these coversio incorporated in India, none of the directors of adustets ade the Copas aaeet the Group companies incorporated in India is Our opiio i so far as it reates to the aaces ad disuaied as o arch fro ei affairs of such susidiaries ad oit veture ocated appointed as a director in terms of Section outside India is based on the report of other auditors of the Act and the conversion adjustments prepared by the aaeet of the Copa ad audited us f) With respect to the adequacy of the internal acia cotros ith referece to acia Our opiio o the cosoidated acia stateets statements of the Holding Company, its ad our report o Other ea ad euator subsidiary company incorporated in India and euireets eo is ot odied i respect of the the operati effectiveess of such cotros above matters with respect to our reliance on the work refer to our separate eport i Aexure A done and the reports of the other auditors and the acia stateetsacia iforatio certied ith respect to the other atters to e icuded the aaeet in the Auditor's Report in accordance with Rule of the Copaies Audit ad Auditors Report on Other Legal and Regulatory ues i our opiio ad to the est of our Requirements information and according to the explanations A As reuired ectio of the Act ased given to us and based on the consideration of the on our audit and on the consideration of reports reports of the other auditors o separate acia of the other auditors o separate acia statements of the subsidiaries and joint venture, statements of such subsidiaries and joint venture as oted i the Other atters pararaph as were audited by other auditors, as noted in the Other atters pararaph e report to the extet i he cosoidated acia stateets applicable, that: disclose the impact of pending litigations as at arch o the cosoidated a) We have sought and obtained all the acia positio of the roup ad its oit information and explanations which to veture efer ote to the cosoidated the best of our knowledge and belief were acia stateets

Corporate Overview Statutory Reports Financial Statements

ii he roup ad its oit veture have ade the reports of the statutory auditors of such provisions, as required under the applicable subsidiary company incorporated in India which law or accounting standards, for material were not audited by us, the remuneration paid foreseeae osses if a o oter during the current year by the Holding Company cotracts icudi derivative cotracts and its subsidiary company to its directors is in accordace ith the provisios of ectio of iii here has ee o dea i trasferri the Act he reueratio paid to a director amounts to the Investor Education and by the Holding Company and its subsidiary Protection Fund by the Holding Company or company is not in excess of the limit laid down its subsidiary company incorporated in India uder ectio of the Act he iistr of duri the ear eded arch Corporate Affairs has ot prescried other detais iv he discosures i the cosoidated acia uder ectio hich are reuired to e statements regarding holdings as well as coeted upo us deais i specied a otes duri the period fro oveer to For B S R & Co. LLP eceer have ot ee ade i the Chartered Accountants acia stateets sice the do ot pertai ir eistratio o to the acia ear eded arch Venkataramanan Vishwanath Partner C ith respect to the atter to e icuded i the Place: Mumbai eership o ate a AAAAC Auditors report uder sectio In our opinion and according to the information and explanations given to us and based on

Lupin Limited | Annual Report 2019-20 Annexure A to the Independent Auditors’ report on the cosoidated acia stateets of upi iited for the period eded arch Report on the internal financial controls with reference to the aforesaid consolidated financial statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013

(Referred to in paragraph A(f) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)

Opinion Auditors’ Responsibility In conjunction with our audit of the consolidated Our resposiiit is to express a opiio o acia stateets of the Copa as of ad for the itera acia cotros ith referece to the ear eded arch e have audited cosoidated acia stateets ased o our the itera acia cotros ith referece to the audit e coducted our audit i accordace ith cosoidated acia stateets of upi iited the Guidance Note and the Standards on Auditing, (hereinafter referred to as “the Holding Company”) prescried uder sectio of the Act to the and one subsidiary, incorporated in India under the extet appicae to a audit of itera acia Companies Act, as of that date cotros ith referece to cosoidated acia stateets hose tadards ad the uidace ote In our opinion, the Holding Company and the require that we comply with ethical requirements company incorporated in India which is its subsidiary, and plan and perform the audit to obtain reasonable have in all material respects, adequate internal assurace aout hether adeuate itera acia acia cotros ith referece to cosoidated cotros ith referece to cosoidated acia acia stateets ad such itera acia statements were established and maintained and cotros ere operati effective as at arch if such cotros operated effective i a ateria ased o the itera acia cotros ith respects referece to cosoidated acia stateets criteria established by such companies considering Our audit ivoves perfori procedures to otai the essential components of such internal controls audit evidence about the adequacy of the internal stated in the Guidance Note on Audit of Internal acia cotros ith referece to cosoidated iacia Cotros Over iacia eporti issued acia stateets ad their operati by the Institute of Chartered Accountants of India effectiveess Our audit of itera acia the uidace ote cotros ith referece to cosoidated acia statements included obtaining an understanding Management’s Responsibility for Internal of itera acia cotros ith referece to Financial Controls cosoidated acia stateets assessi the he respective Copas aaeet ad the risk that a material weakness exists, and testing and Board of Directors are responsible for establishing evauati the desi ad operati effectiveess ad aitaii itera acia cotros ith of the itera cotros ased o the assessed ris referece to cosoidated acia stateets he procedures seected deped o the auditors based on the criteria established by the respective judgement, including the assessment of the risks of Company considering the essential components ateria isstateet of the cosoidated acia of internal control stated in the Guidance stateets hether due to fraud or error ote hese resposiiities icude the desi implementation and maintenance of adequate We believe that the audit evidence we have obtained itera acia cotros that ere operati and the audit evidence obtained by the other effective for esuri the order ad efficiet auditors of the relevant subsidiary company in conduct of its business, including adherence to the ters of their report referred to i the Other atters respective company’s policies, the safeguarding of pararaph eo is sufficiet ad appropriate to its assets, the prevention and detection of frauds provide a basis for our audit opinion on the internal and errors, the accuracy and completeness of the acia cotros ith referece to cosoidated accounting records, and the timely preparation of acia stateets reiae acia iforatio as reuired uder the Copaies Act hereiafter referred to as the Act

Corporate Overview Statutory Reports Financial Statements

Meaning of Internal Financial controls of collusion or improper management override with Reference to Consolidated Financial of controls, material misstatements due to Statements error or fraud a occur ad ot e detected A copas itera acia cotros ith Also, projections of any evaluation of the internal referece to cosoidated acia stateets is a acia cotros ith referece to cosoidated process designed to provide reasonable assurance acia stateets to future periods are suect reardi the reiaiit of acia reporti ad to the ris that the itera acia cotros ith the preparatio of acia stateets for extera referece to cosoidated acia stateets purposes in accordance with generally accepted may become inadequate because of changes in accouti pricipes A copas itera acia conditions, or that the degree of compliance with cotros ith referece to cosoidated acia the poicies or procedures a deteriorate statements includes those policies and procedures Other Matters that pertai to the aiteace of records that Our aforesaid reports uder ectio i of the i reasoae detai accurate ad fair reect the Act o the adeuac ad operati effectiveess transactions and dispositions of the assets of the of the itera acia cotros ith referece copa provide reasoae assurace that to cosoidated acia stateets i so far transactions are recorded as necessary to permit as it relates to one subsidiary company, which is preparatio of acia stateets i accordace incorporated in India, is based on the corresponding with generally accepted accounting principles, and report of the auditors of the said subsidiary that receipts and expenditures of the company are icorporated i dia being made only in accordance with authorisations of aaeet ad directors of the copa ad provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or For B S R & Co. LLP Chartered Accountants disposition of the company's assets that could have a ir eistratio o ateria effect o the acia stateets Venkataramanan Vishwanath Inherent Limitations of Internal Financial Partner Place: Mumbai eership o controls with Reference to Consolidated ate a AAAAC Financial Statements Because of the inherent limitations of internal acia cotros ith referece to cosoidated acia stateets icudi the possiiit

Lupin Limited | Annual Report 2019-20 Consolidated Balance Sheet as at arch (` in million) Note As at As at 31.03.2020 Assets Non-Current Assets a Property, Plant and Equipment Capita oriroress c Goodwill on Consolidation d Other taie Assets 3 e Intangible Assets Under Development 54b f Investments accounted for using equity method 4 Financial Assets i oCurret vestets 5 ii oCurret oas 6 iii Other oCurret iacia Assets 7 h eferred ax Assets et 46 i oCurret ax Assets et Other oCurret Assets 8 Current Assets a Inventories Financial Assets (i) Current Investments 10 ii rade eceivaes 11 (iii) Cash and Cash Equivalents iv Other a aaces 13 (v) Current Loans 14 vi Other Curret iacia Assets 15 c Curret ax Assets et d Other Curret Assets 16 Total 249,838.5 279,493.7 Equity and Liabilities Equity a Equity Share Capital 17 Other Euit 18 Euit attriutae to Oers of the Copa c. oCotroi terest 51 Liabilities Non-Current Liabilities a Financial Liabilities i oCurret orrois ii rade aaes ota outstadi dues of icro Eterprises ad a Eterprises ota outstadi dues of other tha icro Eterprises ad a Eterprises iii Other oCurret iacia iaiities oCurret rovisios c eferred ax iaiities et 46 d Other oCurret iaiities Current Liabilities a Financial Liabilities (i) Current Borrowings ii rade aaes ota outstadi dues of icro Eterprises ad a Eterprises ota outstadi dues of other tha icro Eterprises ad a Eterprises iii Other Curret iacia iaiities Other Curret iaiities c Current Provisions d Curret ax iaiities et Total 249,838.5 279,493.7 ee accopai otes fori part of the cosoidated acia stateets In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta Partner Chairperson Vice Chairman Chief Executive Officer eership o DIN: 00058631 Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam Managing Director Executive irector oa CO Company Secretary Place: Mumbai Head Corporate Affairs AC ate a DIN: 01833346 Corporate Overview Statutory Reports Financial Statements

Consolidated Statement of Profit and Loss for the year ended March 31, 2020 (` in million) Note For the Current For the Previous Year ended Year ended 31.03.2020 31.03.2019 Continuing Operations Income Revenue from Operations 29 153,747.6 146,645.6 Other Income 30 4,837.6 3,330.1 Total Income 158,585.2 149,975.7 Expenses Cost of Materials Consumed 31 31,638.2 31,459.6 Purchases of Stock-in-Trade 22,582.3 20,045.8 Changes in Inventories of Finished Goods 32 85.5 (2,044.5) Work-in-Progress and Stock-in-Trade [(Increase)/Decrease] Employee Benefits Expense 33 29,868.4 27,701.7 Finance Costs 34 3,629.8 3,024.9 Depreciation and Amortisation Expense 2&3 9,702.2 8,460.5 Other Expenses 35 46,025.2 43,875.8 Total Expenses 143,531.6 132,523.8 Profit before Share of Profit of Jointly Controlled Entity and Exceptional items 15,053.6 17,451.9 Share of Profit from Jointly Controlled Entity (net of tax) 39.4 37.5 Profit before Exceptional items and Tax 15,093.0 17,489.4 Exceptional items 54 7,520.7 3,399.8 Profit before Tax 7,572.3 14,089.6 Tax Expense: 46 - Current Tax (net) 6,869.7 8,496.8 - Deferred Tax (net) 4,701.4 382.6 Total Tax Expense 11,571.1 8,879.4 Profit / (Loss) for the year from continuing operations (3,998.8) 5,210.2 Discontinued Operations 55 Profit / (Loss) before tax from discontinued operations 1,195.5 1,082.1 Tax expense of discontinued operations (105.5) 137.5 Profit / (Loss) for the year from discontinued operations 1,301.0 944.6 Profit / (Loss) for the year (2,697.8) 6,154.8 Share of profit / (loss) attributable to Non-Controlling Interest (3.9) 89.3 Profit / (Loss) for the year attributable to Owners of the Company (2,693.9) 6,065.5 Other Comprehensive Income / (Loss) (A) (i) Items that will not be re-classified subsequently to profit or loss: (a) Remeasurements of Defined Benefit Liability (425.9) (24.0) (ii) Income tax relating to items that will not be re-classified to profit or loss: 46 148.1 1.9 (B) (i) Items that will be re-classified subsequently to profit or loss: (a) The effective portion of gain & losses on hedging instruments in (479.7) (372.6) a cash flow hedge (b) Exchange differences in translating the financial statements of (5,449.2) (2,079.6) foreign operations (ii) Income tax relating to items that will be re-classified to profit or loss: 46 128.9 137.4 Other Comprehensive Income / (Loss) for the year, net of tax (6,077.8) (2,336.9) Less : Share of Other Comprehensive Income/(Loss) attributable to 27.5 6.9 Non-Controlling Interest Other Comprehensive Income / (Loss) for the year attributable (6,105.3) (2,343.8) to Owners of the Company Total Comprehensive Income / (Loss) attributable to: Owners of the Company (8,799.2) 3,721.7 Non-Controlling Interest 23.6 96.2 Total Comprehensive / (Loss) Income for the year (8,775.6) 3,817.9 Earnings per equity share for continuing operations (of ` 2/- each) 42 Basic (8.83) 11.52 Diluted (8.83) 11.47 Earnings per equity share for discontinued operations (of ` 2/- each) 42 Basic 2.87 2.09 Diluted 2.86 2.08 Earnings per equity share for continuing and discontinued operations (of ` 2/- each) 42 Basic (5.95) 13.41 Diluted (5.95) 13.36 Face value of Equity Share ( in `) 2.00 2.00 See accompanying notes forming part of the consolidated financial statements In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants Firm Registration No. 101248W/W - 100022 Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta Partner Chairperson Vice Chairman Chief Executive Officer Membership No. 113156 DIN: 00209461 DIN: 00209430 DIN: 00058631 Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam Managing Director Executive Director, Global CFO & Company Secretary Place: Mumbai DIN: 01734642 Head Corporate Affairs ACS - 11973 Date: May 28, 2020 DIN: 01833346 Lupin Limited | Annual Report 2019-20 127

Consolidated Statement of Changes in Equity for the ear eded arch

A. Equity Share Capital [Refer note 17] Particulars As at 31.03.2020 As at No. of Shares ` in million o of hares ` in million Balance at the beginning of the reporting year Changes in equity share capital during the year 410,847 Balance at the end of the reporting year

B. Other Equity [Refer note 18] (` in million) Particulars Other ites of Other Reserves and Surplus Comprehensive Income Share Capital Capital Legal Securities Employees General Retained Foreign Effective Remeasurements Application o ota Reserve Redemption Reserve Premium Stock Reserve Earnings Amalgamation Currency portion of of the net Money Controlling Other Reserve Optios Reserve rasatio Cash Flow eed eet Pending Interest Equity Outstadi Reserve Hedges Plans Allotment

Balance as at 31.03.2018 263.9 126.5 0.3 8,129.4 2,113.8 16,600.5 105,502.1 317.9 - 1,778.8 339.4 (306.2) 400.8135,267.2 rot for the ear Movement in other comprehensive income for the year Final dividend on Equity Shares Corporate ax o ivided Addition on allotment of shares ivided to oCotroi terest Share based payment to employees Balance as at 31.03.2019 263.9 126.5 0.3 8,644.2 2,184.2 16,668.7 108,842.1 317.9 - (306.5) 105.4 (329.4) 468.6 136,985.9 rot for the ear Adjustment for transition to Ind AS eases efer ote Adjustment for transition to Appendex C of d A coe axes efer ote f Disposal of Subsidiary Received during the year Movement in other comprehensive income for the year ecassicatio to rot or oss o disposal of subsidiaires Final dividend on Equity Shares Corporate ax o ivided Addition on allotment of shares ivided to oCotroi terest Share based payment to employees Balance as at 31.03.2020 263.9 126.5 0.3 9,175.4 2,146.2 16,767.1 102,296.2 317.9 0.8 (5,783.2) (242.9) (607.2) 444.6 124,905.6 Consolidated Statement of Changes in Equity for the ear eded arch

Nature of Reserves a) Capital Reserve he Capita reserve is created o receipts of overet rats for setti up the factories i acard areas for perfori research o critica edicies for the etteret of the societ ad o restructuri of the Capita of the Copa uder various schees of Aaaatio

b) Capital Redemption Reserve his reserve represets redeptio of redeeae cuuative preferece shares i earier ears

c) Securities Premium ecurities preiu accout coprises of the preiu o issue of shares he reserve is utiised i accordace ith the specic provisio of the Copaies Act

d) General Reserve he eera reserve is used fro tie to tie to trasfer prots fro retaied earis for appropriatio purposes As the eera reserve is created a trasfer fro oe copoet of euit to aother ad is ot a ite of other coprehesive icoe

e) Amalgamation Reserve his reserve represets creatio of aaaatio reserve pursuat to the schee of aaaatio etee ersthie upi aoratories td ad the Copa

f) Cash Flow Hedge Reserve he cash o hede reserve represets the cuuative effective portio of ais or osses arisi o chaes i fair vaue of desiated portio of hedi istruets etered ito for Cash o hedes he cuuative ai or oss arisi o chaes i fair vaue of the desiated portio of the hedi istruets that are recoised

ad accuuated uder the headi of cash o reserve i e recassied to stateet of prot ad oss o he the heded ites affect the prot or oss Reports Statutory Corporate Overview

g) Legal Reserve his reserve represets appropriatio of certai percetae of prot as per the oca statutor reuireet of fe susidiaries

h) Foreign Currency Translation Reserve his reserve represets exchae differeces arisi o accout of coversio of forei operatios to Copas fuctioa currec Lupin Limited 2019-20 |Annual Report i) Employees Stock Options Outstanding he Copa has epoee stoc optio schees uder hich the optio to suscrie for the Copas shares have ee rated to certai epoees ad directors his is used to recoie the vaue of euitsetted shareased paets provided to the epoees as part of their reueratio

j) Share Application money Pending allotment hare Appicatio oe represets aout received toards share appicatio oe hich ere pedi for aotet as o reporti date

In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o

Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta Partner Chairperson Vice Chairman Chief Executive Officer Financial Statements eership o DIN: 00058631

Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam Managing Director Executive irector oa CO Company Secretary Place: Mumbai Head Corporate Affairs ate a DIN: 01833346 AC Consolidated Statement of Cash Flows for the ear eded arch

(` in million) For the Current For the Previous Year ended Year ended 31.03.2020 A. Cash Flow from Operating Activities rot efore ax Cotiui Operatios iscotiued Operatios Adjustments for: Depreciation and Amortisation Expense oss rot o sae riteoff of ropert at ad Euipet Intangible Assets (Net) Finance Costs Net Gain on Sale of Mutual Fund Investments terest o eposits ith as ad Others Dividend on Mutual Fund Investments outfu rade eceivaes Advaces eposits ritte off ad provided Unrealised Loss/ (Gain) on Mutual Fund Investments (net) Provisions / Credit balances no longer required written back Share Based Payment Expense oss rot o ivestet of susidiaries Impairment of Intangible Assets / Intangible Assets Under Development pairet i vaue of oCurret ivestets hare of rot fro oit Cotroed Etities rovisio for e Europea Coissio Unrealised Exchange loss / (gain) on revaluation (net) Operating Cash flows before Working Capital Changes 24,510.7 31,055.8 Changes in working capital: Adjustments for (increase) / decrease in operating assets: oCurret oas Other oCurret iacia Assets Other oCurret Assets Inventories rade eceivaes Current Loans Other Curret iacia Assets Other Curret Assets Adjustments for increase / (decrease) in operating liabilities: oCurret rade aaes Other oCurret iacia iaiities oCurret rovisios Other oCurret iaiities rade aaes Other Curret iacia iaiities Other Curret iaiities Current Provisions Cash Generated from Operations 19,800.5 26,053.9 Net Income tax paid Net Cash Flow generated / (used in) from Operating Activities 14,688.4 16,659.7 B. Cash Flow from Investing Activities Capital expenditure on Property, Plant and Equipment, including capital advances Proceeds from sale of Property, Plant and Equipment / Intangible Assets roceeds fro ae of oCurret vestets Purchase of Current Investments Proceeds from sale of Current Investments Proceeds from Divestment of subsidiary Bank balances not considered as Cash and Cash Equivalents (net) terest o eposits ith as ad Others Dividend on Mutual Fund Investments Net Cash Flow generated / (used in) from Investing Activities 11,069.9 (32,824.7)

130 Corporate Overview Statutory Reports Financial Statements

Consolidated Statement of Cash Flows for the ear eded arch

(` in million) For the Current For the Previous Year ended Year ended 31.03.2020 C. Cash Flow from Financing Activities roceeds fro epaet of oCurret orrois et Proceeds from / (Repayment of) Current Borrowings (net) roceeds fro issue of euit shares EOs ecurities reiu eceived EOs Payment of Lease liabilities Finance Costs Dividend paid Corporate ax o ivided Net Cash Flow generated / (used in) from Financing Activities (8,905.8) 7,441.3 Net increase / (decrease) in Cash and Cash Equivalents 16,852.5 (8,723.7) Cash and Cash Equivalents as at the beginning of the year Cash and Cash Equivalents as at the end of the year 22,293.1 5,440.6 Reconciliation of Cash and Cash Equivalents with the Balance Sheet Cash ad Cash Euivaets as per aace heet efer ote Unrealised loss / (gain) on foreign currency Cash and Cash Equivalents Cash and Cash Equivalents as restated as at the end of the year 22,293.1 5,440.6

Notes : he aove Cash o tateet has ee prepared uder the direct ethod as set out i the dia Accouti tadard d A tateet of Cash os

Cash coprises cash o had curret accouts ad deposits ith as Cash euivaets are shortter aaces (with an original maturity of three months or less from the date of acquisition), current investments that are convertible ito o aouts of cash ad hich are suect to isiicat ris of chaes i vaue

In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o

Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta Partner Chairperson Vice Chairman Chief Executive Officer eership o DIN: 00058631

Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam Managing Director Executive irector oa CO Company Secretary Place: Mumbai Head Corporate Affairs AC ate a DIN: 01833346

Lupin Limited | Annual Report 2019-20 131 Notes Forming part of the Consolidated Financial Statements

1A. Significant Accounting Policies: underlying assumptions are reviewed on an ooi asis a) Basis of accounting and preparation of Consolidated Financial Statements: Information about critical judgments in Basis of preparation applying accounting policies, as well as i hese cosoidated acia stateets estimates and assumptions that have (hereinafter referred to as ‘consolidated the ost siicat effect to the carri acia stateets of upi iited the amounts of assets and liabilities within Copa ad its susidiaries ad its oit the ext acia ear are icuded i the controlled entity (hereinafter referred to as accouti poicies ‘the Group’), have been prepared in all material easureet of deed eet aspects in accordance with the recognition obligations (Refer note n) and measurement principles laid down in easureet ad ieihood of occurrece Indian Accounting Standards (hereinafter of provisions and contingencies (Refer referred to as the d A as otied uder note r) sectio of the Copaies Act ecoitio of deferred tax assets efer the Act read ith ue of the Copaies note k) dia Accouti tadards ues easureet of cosideratio ad assets as amended and other relevant provisions of acquired as part of business combination the Act and accounting principles generally (Refer note j) accepted i dia hese cosoidated acia sefu ives of propert pat ad statements were authorized for issue by the equipment and Intangibles (Refer note c & d) Copas oard of irectors o a pairet of assets efer ote oodi ipairet efer ote Functional and Presentation Currency rovisio for coe axes ad ucertai ii hese cosoidated acia stateets tax Positions (Refer note k) are presented in Indian rupees, which is the Accrua of saes returs ad appicae fuctioa currec of the paret Copa trade discounts, allowances and A acia iforatio preseted i dia chargeback (Refer note m) rupees has been rounded to the nearest pairet of acia assets efer ote i iio except otherise idicated hareased paet trasactios efer note o) Basis of measurement iii hese cosoidated acia stateets are b) Principles of Consolidation: prepared under the historical cost convention Subsidiaries uess otherise idicated Subsidiaries are all entities (including special purpose entities) that are controlled by the Use of Estimates and Judgements Copa Cotro exists he the Copa iv he preparatio of the cosoidated acia is exposed to or has rights, to variable returns statements in conformity with Ind AS from its involvement with the entity, and has requires Management to make estimates the aiit to affect those returs throuh poer and assumptions considered in the reported over the etit assessi cotro potetia amounts of assets and liabilities (including voting rights are considered only if the rights contingent liabilities) and the reported are sustative he acia stateets of icoe ad expeses duri the ear subsidiaries are included in these consolidated Management believes that the estimates used acia stateets fro the date that cotro i preparatio of the cosoidated acia coeces uti the date that cotro ceases stateets are prudet ad reasoae he acia stateets of the Copa ad its uture resuts coud differ due to these subsidiaries and a jointly controlled entity have estiates ad the differeces etee been consolidated using uniform accounting the actual results and the estimates are policies for like transactions and other events recognized in the periods in which the results in similar circumstances as mentioned in those are oateriaied Estiates ad poicies

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

Upon loss of control, the Group derecognizes Changes in the Group’s equity interest in a the assets and liabilities of the subsidiary, subsidiary that do not result in a loss of control a ocotroi iterests ad the other are accouted for as euit trasactios copoets of euit reated to the susidiar c) Property, Plant and Equipment & Depreciation: A surpus or decit arisi o the oss of cotro I. Recognition and Measurement is recognized in the Consolidated Statement Items of property, plant and equipment of rot ad oss f the Copa retais a are measured at cost less accumulated interest in the previous subsidiary, then such depreciatio ad ipairet osses if a interest is measured at fair value at the date that he cost of a ite of propert pat ad cotro is ost useuet it is accouted for as equipment comprises: an equity accounted investee depending on the eve of iuece retaied its purchase price icudi iport duties ad orefudae purchase taxes after Joint ventures (equity accounted investees) deducti trade discouts ad reates A joint venture is an arrangement in which the Company has joint control, established by a costs direct attriutae to rii the contractual agreement and requiring unanimous asset to the location and condition necessary coset for strateic acia ad operati for it to be capable of operating in the manner decisios vestets i oit cotroed etit iteded aaeet is accounted for using the equity method (equity the iitia estiate of the costs of disati accounted investees) and are initially recognized and removing the item and restoring the at cost he carri vaue of the Copas site on which it is located, the obligation for ivestet icudes oodi idetied o which the Group incurs either when the item acquisition, net of any accumulated impairment is acquired or as a consequence of having osses he Copa does ot cosoidate etities used the item during a particular period for here the ocotroi iterest C hoders purposes other than to produce inventories have certai siicat participati rihts that duri that period provide for effective ivoveet i siicat decisions in the ordinary course of business of icoe ad expeses reated to the icideta such etities vestets i such etities are operations, not necessary to bring the item accouted the euit ethod of accouti to the location and condition necessary for When the Company’s share of losses exceeds it to be capable of operating in the manner its interest in an equity accounted investee, the intended by management, are recognized in carrying amount of that interest (including any Cosoidated tateet of rot ad oss oter ivestets is reduced to ero ad f siicat parts of a ite of propert the recognition of further losses is discontinued pat ad euipet have differet usefu except to the extent that the Company has an lives, then they are accounted for as separate obligation or has made payments on behalf of the items (major components) of property, plant ivestee ad euipet

Transactions eliminated on consolidation Any gain or loss on disposal of an item of traroup aaces ad trasactios ad a property, plant and equipment is recognized in unrealized income and expenses arising from Cosoidated tateet of rot ad oss itraroup trasactios are eiiated i fu Capita oriproress i respect of assets hie prepari these cosoidated acia which are not ready for their intended use are stateets reaied ais or osses arisi fro carried at cost, comprising of direct costs, related transactions with equity accounted investees are icideta expeses ad attriutae iterest eliminated against the investment to the extent of the Copas iterest i the ivestee II. Subsequent Expenditure Subsequent expenditure is capitalised only if it Non-controlling interests (“NCI”) is proae that the future ecooic eets NCI are measured at their proportionate share of associated ith the expediture i o to the the acuirees et idetiae assets at the date of roup acuisitio

Lupin Limited | Annual Report 2019-20 133 Notes Forming part of the Consolidated Financial Statements

III. Depreciation Depreciation on additions (disposals) is provided Depreciable amount for assets is the cost of o a prorata asis ie fro upto the date o an asset, or other amount substituted for cost, hich asset is read for use disposed of ess its estiated residua vaue d) Intangible assets: Depreciation on property, plant and equipment I. Recognition and Measurement of the Company and its subsidiaries Intangible assets are carried at cost less incorporated in India has been provided on accumulated amortization and impairment the straihtie ethod as per the usefu ife osses if a he cost of a itaie asset prescribed in Schedule II to the Act except in comprises of its purchase price, including respect of the following categories of assets, any import duties and other taxes (other in whose case the life of the assets has been than those subsequently recoverable from assessed as under based on independent the taxing authorities), and any directly technical evaluation and management’s attributable expenditure on making the asset assessment thereof, taking into account the read for its iteded use nature of the asset, the estimated usage of Expenditure on research and development the asset, the operating conditions of the eligible for capitalisation are carried as asset, past history of replacement, anticipated Intangible assets under development where technological changes, manufacturers such assets are not yet ready for their arraties ad aiteace support etc iteded use

Particulars Estimated Useful Life II. Subsequent Expenditure Leasehold Land Over the period of ease Subsequent expenditure is capitalised only if it Improvements on Leased Over the period of ease Premises is proae that the future ecooic eets Plant and Equipment 10 to 15 years associated ith the expediture i o to the Office Euipet estop 4 years roup Certain assets provided 3 years to employees III. Amortisation Intangible assets are amortized over their Depreciation on property, plant and estimated useful life on Straight Line Method equipment of the Company's foreign as follows: subsidiaries and a jointly controlled entity has ee provided o straihtie ethod as Particulars Estimated Useful Life per the estimated useful life of such assets as Computer Software to ears follows: radear ad iceses 3 to 13 years Dossiers/Marketing Rights to ears Particulars Estimated Useful Life Buildings1 5 to 50 years he estiated usefu ives of itaie assets Improvements on Over the period of ease and the amortization period are reviewed Leased Premises at the ed of each acia ear ad the Plant and Equipment to ears aortiatio ethod is revised to reect the Furniture and Fixtures to ears chaed patter if a Vehicles 3 to 7 years Office Euipet to ears e) Non-current assets held for sale: respect of susidiaries i apa assets acuired fro Assets are cassied as hed for sae ad stated at Apri oards ere depreciated ased o straiht the lower of carrying amount and fair value less ie ethod costs to sell if the asset is available for immediate respect of susidiaries i apa assets acuired fro sae ad its sae is hih proae uch assets Apri oards ere depreciated ased o straiht ie ethod or group of assets are presented separately in the Assets acuired o ease are depreciated ased o aace heet as Assets Cassied as Hed for straiht ie ethod over their respective ease periods ae Oce cassied as hed for sae itaie assets and property, plant and equipment are no Depreciation method, useful live and residual oer aortied or depreciated vaues are revieed at each acia ear ed ad adusted if appropriate

134 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements f) Research and Development: he ipairet oss is recoied as a expese Revenue expenditure pertaining to research is i the Cosoidated tateet of rot ad oss chared to the Cosoidated tateet of rot unless the asset is carried at revalued amount, in ad oss eveopet costs of products are which case any impairment loss of the revalued also charged to the Consolidated Statement of asset is treated as a revaluation decrease to the rot ad oss i the ear it is icurred uess extent a revaluation reserve is available for that a product’s technological feasibility has been asset established, in which case such expenditure he recoverae aout is the reater of the et is capitaised hese costs are chared to sei price ad their vaue i use aue i use the respective heads in the Consolidated is arrived at discouti the future cash os tateet of rot ad oss i the ear it is to their present value based on an appropriate icurred he aout capitaised coprises of discout rate expenditure that can be directly attributed or allocated on a reasonable and consistent basis When there is indication that an impairment loss for creating, producing and making the asset recognized for an asset (other than a revalued read for its iteded use ropert at ad asset) in earlier accounting periods no longer Equipment utilised for research and development exists or may have decreased, such reversal of are capitalised and depreciated in accordance impairment loss is recognized in the Consolidated with the policies stated for Property, Plant and tateet of rot ad oss to the extet Euipet the amount was previously charged to the Cosoidated tateet of rot ad oss case Expediture o iicesed deveopet activities of revaued assets such reversa is ot recoied here research dis are appied to a pa or design for the production of new or substantially Goodwill impairment improved products and processes, is capitalised, oodi is tested for ipairet aua if the cost can be reliably measured, the product If events or changes in circumstances indicate or process is technically and commercially a potential impairment, as part of the review feasie ad the roup has sufficiet resources to process, the carrying amount of the Cash complete the development and to use and sell the Generating Units (CGUs) (including allocated asset goodwill) is compared with its recoverable aout the roup he recoverae aout Payments to third parties that generally take the is the higher of fair value less costs to sell and for of upfrot paets ad iestoes for value in use, both of which are calculated by the iicesed products copouds ad iteectua roup usi a discouted cash o aasis property are capitalised since the probability of Cacuati the future et cash os expected expected future ecooic eets criterio is to be generated to determine if impairment aas cosidered to e satised for separate exists and to calculate the impairment involves acuired itaie assets siicat assuptios estiatio ad udet g) Impairment of assets: he estiatio ad udet ivoves ut is he carri vaues of assets at each aace not limited to, industry trends including pricing, sheet date are reviewed for impairment if any estiati oter reveues reveue roth idicatio of ipairet exists he fooi ad operati expeses intangible assets are tested for impairment each Impairment of CMPs/ANDA filings/Acquired In- acia ear eve if there is o idicatio that the Process Research & Development asset is impaired: taie assets ith deite usefu ives are i) an intangible asset that is not yet available for suect to aortiatio taies Assets are use; and reviewed at the end of each reporting period to ii a itaie asset that is havi ideite determine whether there is any indication that usefu ife the carrying value of these assets may not be If the carrying amount of the assets exceed the recoverae ad have suffered a ipairet estimated recoverable amount, an impairment oss f a such idicatio exists the recoverae is recoied for such excess aout amounts of the intangible assets are estimated in

Lupin Limited | Annual Report 2019-20 135 Notes Forming part of the Consolidated Financial Statements

order to determine the extent of the impairment monetary item relates and depreciated over oss if a he recoverae aout is the hiher the reaii usefu ife of such assets f such of an asset’s fair value less costs to sell and value monetary items do not relate to acquisition i use uch ipairet oss is recoied i the of depreciae xed assets the exchae Cosoidated tateet of rot ad oss differece is aortied over the aturit period/upto the date of settlement of such Intangible Assets under development are monetary items, whichever is earlier, and reviewed at the end of each reporting period to charged to the Consolidated Statement of determine whether there is any indication that rot ad oss except i case of exchae the carrying value of these assets may not be differeces arisi o et ivestet i recoverae ad have suffered a ipairet oss foreign operations, where such amortization Management judgement is required in the area is tae to orei Currec rasatio of intangible asset impairment, particularly in eserve C uti disposarecover of the assessi hether a evet has occurred that et ivestet he uaortied exchae may indicate that the related asset values may differece is carried uder eserves ad ot e recoverae hether the carri vaue Surplus as Foreign Currency Monetary Item of an asset can be supported by the recoverable rasatio ifferece Accout CA et amount, being the higher of fair value less costs of the tax effect thereo here appicae to se or et preset vaue of future cash os v) In case of foreign operations whose functional which are estimated based upon the continued currec is differet fro the paret use of the asset i the roup company’s functional currency, the assets h) Foreign Currency Transactions/Translations: and liabilities of such foreign operations, i rasactios i forei currecies are including goodwill and fair value adjustments translated to the respective functional arising upon acquisition, are translated to the currencies of entities within the Group reporting currency at exchange rates at the at exchange rates at the dates of the reporti date he icoe ad expeses of trasactios such foreign operations are translated to the reporting currency at the monthly average ii) Monetary assets and liabilities denominated exchae rates prevaii duri the ear in foreign currencies at the reporting date esuti forei currec differeces are are translated into the functional currency recognized in other comprehensive income at the exchae rate of the reporti date ad preseted ithi euit as part of C ooetar assets ad iaiities that are When a foreign operation is disposed of, in measured based on historical cost in a foreign part or i fu the reevat aout i the C currency are translated at the exchange rate is recassied to the Cosoidated tateet at the date of the trasactio of rot ad oss as a part of ai or oss o iii Exchae differeces arisi o the disposa settlement of monetary items or on i) Financial Instruments: translating monetary items (except for I. Financial Assets long term monetary items outstanding as Classification at arch at rates differet fro O iitia recoitio the roup cassies those at which they were translated on initial acia assets as suseuet easured recognition during the period or in previous at amortized cost, fair value through other acia stateets are recoied i the comprehensive income or fair value through Cosoidated tateet of rot ad oss i prot or oss o the asis of its usiess the period i hich the arise ode for aai the acia assets ad iv) In case of long term monetary items the cotractua cash o characteristics of outstadi as at arch the acia asset exchae differeces arisi o setteet Initial recognition and measurement restatement thereof are capitalised as part A acia assets ot easured of the depreciae xed assets to hich the suseuet at fair vaue throuh prot or

136 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

loss) are recognized initially at fair value plus asis he cassicatio is ade o iitia transaction costs that are attributable to the recoitio ad is irrevocae acuisitio of the acia asset urchases or If the Group decides to classify an saes of acia assets that reuire deiver euit istruet as at OC the of assets within a time frame established all fair value changes on the instrument, by regulation or convention in the market excluding dividends, are recognized in place (regular way trades) are recognized on other coprehesive icoe OC here is the trade date ie the date that the roup o recci of the aouts fro OC to coits to purchase or se the asset Cosoidated tateet of rot ad oss Financial assets at amortized cost eve o sae of such ivestets A acia asset is easured at the Euit istruets icuded ithi the amortized cost if both the following category are measured at fair value with conditions are met: all changes recognized in the Consolidated i he asset is hed ithi a usiess tateet of rot ad oss model whose objective is to hold Derecognition assets for collecting contractual cash A acia asset or here appicae a os ad part of a acia asset or part of a roup ii) Contractual terms of the asset give of siiar acia assets is priari rise o specied dates to cash os derecoied ie reoved fro the roups that are solely payments of principal acia stateets he and interest (SPPI) on the principal he rihts to receive cash os fro the aout outstadi asset have expired, or After iitia easureet such acia he roup has trasferred its rihts to assets are subsequently measured at receive cash os fro the asset or has aortied cost usi the effective iterest rate assumed an obligation to pay the received E ethod Aortied cost is cacuated cash os i fu ithout ateria dea taking into account any discount or premium to a third part uder a passthrouh and fees or costs that are an integral part arrangement; and either: of the E he E aortiatio is icuded i ace icoe i the Cosoidated i) the Group has transferred substantially all tateet of rot ad oss he osses the risks and rewards of the asset, or arising from impairment are recognized in the ii) the Group has neither transferred nor Cosoidated tateet of rot ad oss retained substantially all the risks and his cateor eera appies to trade ad rewards of the asset, but has transferred other receivaes cotro of the asset Financial assets included within the fair value When the Group has transferred its rights throuh prot ad oss cateor to receive cash os fro a asset or has are measured at fair value with all changes etered ito a passthrouh arraeet recognized in the Consolidated Statement of it evaluates if and to what extent it has rot ad oss retaied the riss ad reards of oership Equity investments When it has neither transferred nor retained A euit ivestets i scope of dA substantially all of the risks and rewards are easured at fair vaue Euit istruets of the asset, nor transferred control of the hich are hed for tradi are cassied as at asset, the Group continues to recognise the or a other euit istruets the transferred asset to the extent of the Group’s Group decides to classify the same either as cotiui ivoveet that case the at fair value through other comprehensive roup aso recoises a associated iaiit icoe OC or he roup aes he trasferred asset ad the associated such eectio o a istruetistruet iaiit are easured o a asis that reects

Lupin Limited | Annual Report 2019-20 137 Notes Forming part of the Consolidated Financial Statements

the rights and obligations that the Group has A acia iaiities are recoied iitia retaied at fair value and, in the case of loans and borrowings and payables, net of directly Continuing involvement that takes the form attriutae trasactio costs of a guarantee over the transferred asset is measured at the lower of the original carrying he roups acia iaiities icude trade amount of the asset and the maximum and other payables, loans and borrowings amount of consideration that the Group could icudi a overdrafts acia uaratee e reuired to repa cotracts ad derivative acia istruets

Impairment of financial assets Financial liabilities at fair value through profit accordace ith dA the roup or loss applies Expected Credit Loss (ECL) model for iacia iaiities at fair vaue throuh prot measurement and recognition of impairment or oss icude acia iaiities hed for oss o the fooi acia assets ad tradi ad acia iaiities desiated credit risk exposure: upon initial recognition as at fair value throuh prot or oss iacia iaiities i) Financial assets that are debt instruments, are cassied as hed for tradi if the are ad are easured at aortied cost e incurred for the purpose of repurchasing in loans, debt securities, deposits, and bank the ear ter his cateor aso icudes aace derivative acia istruets etered ito ii rade receivaes by the Group that are not designated as hedging instruments in hedge relationships as he roup foos sipied approach for deed dA eparated eedded recognition of impairment loss allowance derivatives are aso cassied as hed for on trade receivables which do not contain a tradi uess the are desiated as effective siicat aci copoet hedi istruets he appicatio of sipied approach does Gains or losses on liabilities held for trading not require the Group to track changes in are recognized in the Consolidated Statement credit ris ather it recoises ipairet of rot ad oss loss allowance based on lifetime ECLs at each reporting date, right from its initial Financial liabilities designated upon initial recoitio recoitio at fair vaue throuh prot or loss are designated at the initial date of II. Financial Liabilities recoitio ad o if the criteria i dA Classification are satised or iaiities desiated as he roup cassies a acia iaiities as fair vaue aisosses attriutae to subsequently measured at amortized cost, changes in own credit risk are recognized in except for acia iaiities easured at fair OC hese aisosses are ot suseuet vaue throuh prot or oss uch iaiities transferred to Consolidated Statement of including derivatives that are liabilities, are rot ad oss Hoever the roup a subsequently measured at fair value with transfer the cumulative gain or loss within changes in fair value being recognized in the euit A other chaes i fair vaue of such Cosoidated tateet of rot ad oss liability are recognized in the Consolidated Initial recognition and measurement tateet of rot ad oss iacia iaiities are cassied at iitia Loans and borrowings recoitio as acia iaiities at fair After iitia recoitio iteresteari vaue throuh prot or oss at aortied loans and borrowings are subsequently cost (loans, borrowings and payables) measured at amortized cost using the EIR or as derivatives designated as hedging ethod ais ad osses are recoied i istruets i a effective hede as Cosoidated tateet of rot ad oss appropriate he the iaiities are derecoied

138 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

Amortized cost is calculated by taking Derivative financial instruments into account any discount or premium on he roup uses derivative acia acquisition and fees or costs that are an instruments, such as foreign exchange itera part of the E he E aortiatio forward contracts, interest rate swaps and is icuded as ace costs i the currency options to manage its exposure Cosoidated tateet of rot ad oss to iterest rate ad forei exchae riss uch derivative acia istruets are his cateor eera appies to initially recognized at fair value on the date on iteresteari oas ad orrois which a derivative contract is entered into and Derecognition are suseuet reeasured at fair vaue A acia iaiit is derecoied he the erivatives are carried as acia assets obligation under the liability is discharged he the fair vaue is positive ad as acia or caceed or expires he a existi iaiities he the fair vaue is eative acia iaiit is repaced aother fro Hedge Accounting the sae eder o sustatia differet he roup uses forei currec forard terms, or the terms of an existing liability are contracts to hedge its risks associated sustatia odied such a exchae or ith forei currec uctuatios reati odicatio is treated as the derecoitio to hih proae forecast trasactios of the original liability and the recognition of he roup desiates such forard cotracts a e iaiit he differece i the respective i a cash o hedi reatioship carrying amounts is recognized in the appi the hede accouti pricipes Cosoidated tateet of rot ad oss hese forard cotracts are stated at fair Embedded derivatives vaue at each reporti date Chaes i the If the hybrid contract contains a host that fair value of these forward contracts that is a acia asset ithi the scope dA are desiated ad effective as hedes of the roup does ot separate eedded future cash os are recoied direct derivatives ather it appies the cassicatio i Other Coprehesive coe OC reuireets cotaied i d A to the ad accuuated i Cash o Hede etire hrid cotract erivatives eedded eserve Accout uder Other Euit et in all other host contracts are accounted for as of applicable deferred income taxes and the separate derivatives and recorded at fair value ieffective portio is recoied iediate if their economic characteristics and risks i the Cosoidated tateet of rot are not closely related to those of the host ad oss Aouts accuuated i the contracts and the host contracts are not held Cash o Hede eserve Accout are for trading or designated at fair value through recassied to the Cosoidated tateet prot or oss hese eedded derivatives of rot ad oss i the sae period duri are measured at fair value with changes hich the forecasted trasactio affects in fair value recognized in Consolidated Cosoidated tateet of rot ad tateet of rot ad oss uess oss Hede accouti is discotiued desiated as effective hedi istruets when the hedging instrument expires or is Reassessment only occurs if there is either sold, terminated, or exercised, or no longer a change in the terms of the contract that uaies for hede accouti or forecasted siicat odies the cash os transactions, any cumulative gain or loss on the hedi istruet recoied i Cash Offsetting of financial instruments o Hede eserve Accout is retaied iacia assets ad acia iaiities uti the forecasted trasactio occurs f the are offset ad the et aout is reported forecasted transaction is no longer expected in the balance sheet if there is a currently to occur, the net cumulative gain or loss eforceae ea riht to offset the recoied i Cash o Hede eserve recognized amounts and there is an intention Accout is iediate trasferred to the to settle on a net basis, to realise the assets Cosoidated tateet of rot ad oss ad sette the iaiities siutaeous

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

III. Measurement from a past event, and its fair value can he roup deteries the fair vaue of its e easured reia he the fair vaue acia istruets o the asis of the of the et idetiae assets acuired ad following hierarchy: liabilities assumed exceeds the consideration transferred, a bargain purchase gain is a eve he fair vaue of acia recoied as capita reserve instruments quoted in active markets is based on their quoted closing price at the iv) Consideration transferred includes the fair aace sheet date values of the assets transferred, liabilities incurred by the Company to the previous eve he fair vaue of acia owners of the acquiree, and equity interests instruments that are not traded in an issued the Copa Cosideratio active market is determined by using transferred also includes the fair value of valuation techniques using observable a cotiet cosideratio Cosideratio aret data uch vauatio techiues transferred does not include amounts related icude discouted cash os stadard to setteet of preexisti reatioships valuation models based on market parameters for interest rates, yield v) Any contingent consideration is measured curves or foreign exchange rates, dealer at fair vaue at the date of acuisitio f a quotes for similar instruments and use of obligation to pay contingent consideration coparae ars eth trasactios that eets the deitio of a acia istruet is cassied as euit the it is c eve he fair vaue of acia not remeasured and settlement is accounted instruments that are measured on the for ithi euit Otherise suseuet asis of etit specic vauatios usi changes in the fair value of the contingent inputs that are not based on observable consideration are recognized in the aret data uoservae iputs Cosoidated tateet of rot ad oss j) Business combinations: vi rasactio costs that the Copa icurs i i he roup accouts for each usiess connection with a business combination, such combination by applying the acquisition as ders fees ea fees due diiece fees ethod he acuisitio date is the date o and other professional and consulting fees, hich cotro is trasferred to the acuirer are expesed as icurred udet is appied i deterii the acquisition date and determining whether vii O a acuisitioacuisitio asis the control is transferred from one party to Copa recoies a ocotroi aother interest in the acquiree either at fair value or at the ocotroi iterests proportioate ii) Control exists when the Company is exposed share of the acuirees idetiae et assets to, or has rights to, variable returns from its involvement with the entity and has the ability viii) Any goodwill that arises on account of such to affect those returs throuh poer over the business combination is tested annually for etit assessi cotro potetia voti ipairet rights are considered only if the rights are ix Acuisitios of ocotroi iterests are sustative accounted for as transactions with equity iii he Copa easures oodi as of the hoders i their capacit as euit hoders applicable acquisition date at the fair value he differece etee a cosideratio of the consideration transferred, including the paid and the relevant share acquired of the recoied aout of a ocotroi carrying value of net assets of the subsidiary interest in the acquiree, less the net is recorded i euit recoied aout of the idetiae assets k) Income tax: acquired and liabilities assumed (including Income tax expense consists of current and contingent liabilities in case such a liability deferred tax coe tax expese is recoised represents a present obligation and arises

140 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

i the stateet of prot ad oss except to i) When the Group is able to control the timing the extent that it relates to items recognised of the reversa of the teporar differece in other comprehensive income or directly in and euit this case the tax is aso recoised i ii it is proae that the teporar differece other comprehensive income or directly in equity, i ot reverse i the foreseeae future respective Deferred taxes are measured at the tax rates Current tax that are expected to be applied to temporary Current tax comprises the expected tax payable differeces he the reverse usi tax rates or receivable on the taxable income or loss for enacted or substantively enacted at the reporting the year and any adjustment to the tax payable date or receivae i respect of previous ears t is measured using tax rates enacted or substantively he easureet of deferred taxes reects eacted at the reporti date the tax consequences that would follow from the manner in which the Group expects, at the Curret tax assets ad iaiities are offset o if reporting date, to recover or settle the carrying the Group: aout of its assets ad iaiities i has a ea eforceae riht to set off the recognized amounts; and eferred tax assets ad iaiities are offset o if ii) Intends either to settle on a net basis, or i) the Group has a legally enforceable right to to realise the asset and settle the liability set off curret tax assets aaist curret tax siutaeous liabilities; and

Deferred tax ii he deferred tax assets ad the deferred tax Deferred taxes are recognized in respect of liabilities relate to income taxes levied by the teporar differeces etee the carri same taxation authority on the same taxable aouts of assets ad iaiities for acia etit reporting purposes and the amounts used for l) Inventories: taxation purposes (including those arising from vetories of a procured aterias ad toci consolidation adjustments such as unrealised rade are vaued at the oer of cost o ovi prot o ivetor etc weighted average basis) and the net realisable Deferred tax assets are recognized for unused value after providing for obsolescence and other tax losses, unused tax credits and deductible osses here cosidered ecessar Cost icudes teporar differeces to the extet that it all charges in bringing the goods to their present is proae that future taxae prots i ocatio ad coditio icudi ocreditae e avaiae aaist hich the ca e used taxes and other levies, transit insurance and Deferred tax assets are reviewed at each reporting receivi chares oriprocess ad ished date and are reduced to the extent that it is no goods include appropriate proportion of oer proae that the reated tax eet i overheads ad here appicae excise dut be realised; such reductions are reversed when the m) Revenue Recognition: proaiit of future taxae prots iproves Sale of Goods Unrecognized deferred tax assets are reassessed he aorit of the Copas cotracts reated at each reporting date and recognized to the to product sales include only one performance extent that it has become probable that future obligation, which is to deliver products to taxae prots i e avaiae aaist hich the custoers ased o purchase orders received ca e used Revenue from sales of products is recognized at a point in time when control of the products he roup recoises deferred tax iaiit for is transferred to the customer, generally upon a taxae teporar differeces associated delivery, which the Company has determined is with investments in subsidiaries, branches and when physical possession, legal title and risks and associates, and interests in joint arrangements, rewards of ownership of the products transfer except to the extent that both of the following to the customer and the Company is entitled coditios are satised

Lupin Limited | Annual Report 2019-20 141 Notes Forming part of the Consolidated Financial Statements

to paet he tii of the trasfer of riss Defined contribution plans and rewards varies depending on the individual Oiatios for cotriutios to deed ters of the saes areeets eveue fro contribution plans are expensed as the related the sale of goods is measured at the fair value service is provided and the Group will have no of the consideration received or receivable legal or constructive obligation to pay further (after including fair value allocations related to aouts repaid cotriutios are recoied multiple deliverable and/or linked arrangements), as an asset to the extent that a cash refund or a et of returs saes tax ad appicae reductio i future paets is avaiae trade discouts aoaces ad chareac Defined benefit plans Revenue includes shipping and handling costs he roups et oiatio i respect of deed ied to the custoer eet pas is cacuated separate for each Income from research services pa estiati the aout of future eet Income from research services including sale of that employees have earned in the current and techoooho rihts iceses ad other prior periods, discounting that amount and intangibles) is recognized in accordance with the deducti the fair vaue of a pa assets terms of the contract with customers when the he cacuatio of deed eet oiatios related performance obligation is completed, is performed periodically by an independent or when risks and rewards of ownership are uaied actuar usi the proected uit trasferred as appicae credit ethod he the cacuatio resuts i he Copa eters ito certai dossier saes a potential asset for the Group, the recognized licensing and supply arrangements that, in asset is limited to the present value of economic certain instances, include certain performance eets avaiae i the for of a future oiatios ased o a evauatio of hether refunds from the plan or reductions in future or not these obligations are inconsequential or cotriutios to the pa o cacuate the preset perfunctory, the Company recognise or defer vaue of ecooic eets cosideratio is ive the upfront payments received under these to a appicae iiu fudi reuireets arraeets eeasureet of the et deed eet Interest income liability, which comprise actuarial gains and Interest income is recognized with reference to the losses and the return on plan assets (excluding Effective terest ate ethod iterest ad the effect of the asset ceii if a excluding interest), are recognized immediately in Dividend income other coprehesive icoe OC et iterest Dividend from investment is recognized as expese icoe o the et deed iaiit reveue he riht to receive is estaished (assets) is computed by applying the discount Income from Export Benefits and Other rate used to easure the et deed iaiit Incentives asset et iterest expese ad other expeses Export eets avaiae uder prevaet schees reated to deed eet pas are recoied i are accrued as revenue in the year in which the Cosoidated tateet of rot ad oss goods are exported and / or services are rendered he the eets of a pa are chaed or only when there reasonable assurance that the when a plan is curtailed, the resulting change in conditions attached to them will be complied eet that reates to past service or the ai ith ad the aouts i e received or loss on curtailment is recognized immediately n) Employee Benefits: i Cosoidated tateet of rot ad oss Short term employee benefits he roup recoises ais ad osses o the hortter epoee eets are expesed as the setteet of a deed eet pa he the reated service is provided A iaiit is recoied setteet occurs for the amount expected to be paid if the Group Other long-term employee benefits has a present legal or constructive obligation he roups et oiatio i respect of oter to pay this amount as a result of past service epoee eets is the aout of future provided by the employee and the obligation can eet that epoees have eared i retur e estiated reia Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

for their service i the curret ad prior periods for cosideratio o assess hether a cotract he oiatio is easured o the asis of a conveys the right to control the use of an periodical independent actuarial valuation using idetied asset the roup uses the deitio the proected uit credit ethod eeasureet of a ease i d A his poic is appied to are recognized in Consolidated Statement of cotracts etered ito o or after st Apri rot ad oss i the period i hich the arise Group as a lessee o) Share-based payment transactions: he roup accouts for each ease copoet Epoees toc Optios as EOs within the contract as a lease separately from he rat date fair vaue of optios rated oease copoets of the cotract ad to employees is recognized as an employee allocates the consideration in the contract to expense, with a corresponding increase in each lease component on the basis of the relative equity, over the period that the employees stadaoe price of the ease copoet ad ecoe ucoditioa etited to the optios the areate stadaoe price of the oease he expese is recorded for each separate copoets vesting portion of the award as if the award was, he roup recoises rihtofuse asset i sustace utipe aards he icrease i representing its right to use the underlying asset Other Euit recoied i coectio ith share for the lease term at the lease commencement based payment transaction is presented as a date he cost of the rihtofuse asset easured separate component in equity under “Employee at inception shall comprise of the amount of toc Optios Outstadi eserve he aout the initial measurement of the lease liability recoied as a expese is adusted to reect the adjusted for any lease payments made at or actua uer of stoc optios that vest before the commencement date less any lease p) Discontinued Operations: incentives received, plus any initial direct costs A discontinued operation is a component of the incurred and an estimate of costs to be incurred roups usiess the operatios ad cash os of by the lessee in dismantling and removing the which can be clearly distinguished from the rest of underlying asset or restoring the underlying asset the Group and which: or site o hich it is ocated he rihtofuse assets is subsequently measured at cost less – represents a separate major line of business or any accumulated depreciation, accumulated geographic area of operations; impairment losses, if any and adjusted for is part of a sie coordiated pa to a reeasureet of the ease iaiit dispose of a separate major line of business or he rihtofuse assets is depreciated usi the geographic area of operations; or straihtie ethod fro the coeceet date over the shorter of lease term or useful – is a subsidiary acquired exclusively with a view ife of rihtofuse asset he estiated usefu to resae ives of rihtof use assets are deteried o Cassicatio as a discotiued operatio occurs the same basis as those of property, plant and at the earlier of disposal or when the operation euipet ihtofuse assets are tested for eets the criteria to e cassied as hedforsae impairment whenever there is any indication that their carri aouts a ot e recoverae he a operatio is cassied as a discotiued Impairment loss, if any, is recognised in the operatio the coparative stateet of prot or stateet of prot ad oss oss ad OC is represeted as if the operatio had been discontinued from the start of the he roup easures the ease iaiit at the coparative ear present value of the lease payments that are not paid at the commencement date of the q) Leases: ease he ease paets are discouted usi At inception of a contract, the Group assesses the interest rate implicit in the lease, If that hether a cotract is or cotais a ease rate cannot be readily determined, the Group A contract is, or contains, a lease if the contract uses incremental borrowing rate, Generally, conveys the right to control the use of an the Group uses its incremental borrowing rate idetied asset for a period of tie i exchae as the discout rate he roup deteries its

Lupin Limited | Annual Report 2019-20 143 Notes Forming part of the Consolidated Financial Statements

incremental borrowing rate by obtaining interest sie oaace sheet ease accouti ode rates fro various extera aci sources ad for essees aes certai adustets to reect the ters of he roup has adopted d A effective the ease ad tpe of the asset eased or eases aua reporti period eii Apri with reasonably similar characteristics, the Group, ad appied the stadard to its eases on a lease by lease basis, may adopt either the retrospective ith the cuuative effect of icreeta orroi rate specic to the ease or initially applying the Standard, recognised on the incremental borrowing rate for the portfolio the date of iitia appicatio Apri as a hoe he ease paets sha icude Accordingly, the Group has not restated xed paets variae ease paets residua comparative information, instead, the cumulative value guarantees, exercise price of a purchase effect of iitia appi this stadard has ee option where the Group is reasonably certain to recognised as an adjustment to the opening exercise that option and payments of penalties aace of retaied earis as o Apri for teriati the ease if the ease ter reects the lessee exercising an option to terminate efer ote A p iicat accouti poicies the ease he ease iaiit is suseuet – Leases in the Annual report of the Company for remeasured by increasing the carrying amount to the ear eded arch for the poic as reect iterest o the ease iaiit reduci the per d A carri aout to reect the ease paets Group as a lessee made and remeasuring the carrying amount to Operating Lease: reect a reassesset or ease odicatios For transition, the Group has elected not to or to reect revised isustace xed ease app the reuireets of d A to eases paets he roup recoises the aout hich are expiri ithi oths fro the of the reeasureet of ease iaiit due to date of transition by class of asset and leases odicatio as a adustet to the rihtofuse for which the underlying asset is of low value asset ad stateet of prot ad oss depedi o a easeease asis he roup has aso upo the ature of odicatio here the used the practical expedient provided by the carri aout of the rihtofuse asset is stadard he appi d A to eases reduced to zero and there is a further reduction previous cassied as operati eases uder in the measurement of the lease liability, the d A ad therefore has ot reassessed Group recognises any remaining amount of the whether a contract, is or contains a lease, at the reeasureet i stateet of prot ad oss date of initial application, relied on its assessment he roup has eected ot to app the of whether leases are onerous, applying Ind reuireets of d A eases to shortter A iediate efore the date of iitia leases of all assets that have a lease term of application as an alternative to performing an oths or ess ad eases for hich the impairment review, excluded initial direct costs uderi asset is of o vaue he ease from measuring the right of use asset at the payments associated with these leases are date of initial application and used hindsight recoied as a expese o a straihtie asis when determining the lease term if the contract over the ease ter cotais optios to exted or teriate the ease he roup has used a sie discout rate to a Transition to Ind AS 116 portfoio of eases ith siiar characteristics iistr of Corporate Affairs CA throuh Companies (Indian Accounting Standards) O trasitio the roup recoised a ease Aedet ues ad Copaies dia liability measured at the present value of the Accounting Standards) Second Amendment remaining lease payments, but discounted ues has otied d A eases hich at the Group’s incremental borrowing rate replaces the existing lease standard, Ind AS as at st Apri he rihtofuse asset eases ad other iterpretatios d A is recognised at its carrying amount as if sets out the pricipes for the recoitio the standard had been applied since the measurement, presentation and disclosure of coeceet of the ease Accordi a eases for oth essees ad essors t itroduces a rihtofuse asset of ` iio ad a

144 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

corresponding lease liability of ` iio Impact of COVID-19 has ee recoied he cuuative effect o he roup does ot foresee a arescae trasitio i retaied earis et off taxes ad contraction in demand which could result in lease equalisation liability is ` iio siicat do sii of its epoee ase (including a deferred tax of ` iio ad rederi the phsica ifrastructure redudat lease equalization liability of ` iio he eases that the roup has etered ith he pricipa portio of the ease paets lessors towards properties used as delivery have ee discosed uder cash o fro ceters saes offices are o ter i ature ad aci activities he ease paets for no changes in terms of those leases are expected operati eases as per d A eases ere due to the CO earier reported uder cash o fro operati r) Provisions and Contingent Liabilities: activities he eihted averae icreeta A provision is recognized when the Group has a orroi rate of has ee appied to present obligation as a result of past events and lease liabilities recognised in the balance sheet at it is proae that a outo of resources i the date of iitia appicatio be required to settle the obligation in respect of O appicatio of d A the ature of hich a reiae estiate ca e ade f effect expenses has changed from lease rent in previous of the time value of money is material, provisions periods to depreciatio cost for the rihttouse are discounted using an appropriate discount rate asset ad ace cost for iterest accrued o that reects he appropriate the riss specic ease iaiit to the iaiit he discouti is used the increase in the provision due to the passage of he differece etee the future iiu ease tie is recoied as a ace cost reta coitets toards ocaceae operati eases ad ace eases reported as at Provision for asset retirement obligations is arch copared to the ease iaiit as measured at the present value of the best accouted as at Apri is priari due to estimate of the cost of restoration at the time of inclusion of present value of the lease payments asset retireet for the cancellable term of the leases, reduction Contingent liabilities are disclosed in the Notes due to discounting of the lease liabilities as per to the cosoidated acia stateets the reuireet of d A ad excusio of Contingent liabilities are disclosed for the commitments for the leases to which the Group has chosen to apply the practical expedient i possie oiatios hich i e cored as per the stadard only by future events not wholly within the control of the Group or Finance Lease he roup has eases that ere cassied as ii) present obligations arising from past events ace eases appi d A or such eases here it is ot proae that a outo the carri aout of the rihtofuse asset ad of resources will be required to settle the the lease liability at the date of initial application obligation or a reliable estimate of the of d A is the carri aout of the ease aout of the oiatio caot e ade asset and lease liability on the transition date s) Borrowing costs: as easured appi d A Accordi a Borrowing costs are interest and other costs that amount of ` iio has ee recassied the Group incurs in connection with the borrowing fro propert pat ad euipet to rihtof of funds and is measured with reference to the use assets A aout of ` iio has ee effective iterest rate E appicae to the recassied fro other curret acia iaiities respective orroi orroi costs icude to lease liability – current and an amount interest costs measured at EIR and exchange of ` iio has ee recassied fro differeces arisi fro forei currec orrois o curret to ease iaiit borrowings to the extent they are regarded as an ocurret adustet to the iterest cost

Lupin Limited | Annual Report 2019-20 145 Notes Forming part of the Consolidated Financial Statements

Borrowing costs, allocated to qualifying assets, dividi the protoss after tax as adusted pertaining to the period from commencement of for dividend, interest and other charges to activities relating to construction/development expense or income (net of any attributable taxes) of the qualifying asset up to the date of relating to the dilutive potential equity shares, capitalisation of such asset are added to the cost by the weighted average number of equity of the assets Capitaisatio of orroi costs shares considered for deriving basic earnings is suspended and charged to the Consolidated per share and the weighted average number of tateet of rot ad oss duri exteded equity shares which could have been issued on periods when active development activity on the coversio of a diutive potetia euit shares uaifi assets is iterrupted he cacuatio of diuted earis per share does not assume conversion, exercise, or other issue All other borrowing costs are recognized as an of potential ordinary shares that would have an expese i the period hich the are icurred atidiutive effect o earis per share t) Government Grants: v) Insurance claims: Government grants are initially recognized at fair Insurance claims are accounted for on the basis value if there is reasonable assurance that they of claims admitted/expected to be admitted and will be received and the Group will comply with to the extent that the amount recoverable can be the conditions associated with the grant; measured reliably and it is reasonable to expect case of capita rats the are the the utiate coectio recognized in Consolidated Statement w) Goods and Services tax input credit: of rot ad oss as other icoe o a Goods and Services tax input credit is accounted systematic basis over the useful life of the for in the books in the period in which the asset underlying service received is accounted and case of rats that copesate the roup when there is reasonable certainty in availing/ for expenses incurred are recognized in utiisi the credits Cosoidated tateet of rot ad oss o x) Segment reporting: a systematic basis in the periods in which the he roup operates i oe reportae usiess expeses are recoied seet ie haraceuticas Export eets avaiae uder prevaet y) Operating cycle: schemes are accrued in the year in which the Based on the nature of products/activities of the goods are exported and there is no uncertainty in Group and the normal time between acquisition receivi the sae of assets and their realisation in cash or cash u) Earnings per share: equivalents, the Group has determined its Basic earnings per share is computed by dividing operati cce as oths for the purpose the prot after tax the eihted averae of cassicatio of its assets ad iaiities as number of equity shares outstanding during the curret ad ocurret as set out i chedue ear he eihted averae uer of euit of the Act shares outstanding during the year is adjusted 1B. Recent Accounting Pronouncements: for the events for bonus issue, bonus element Other Amendments: in a rights issue to existing shareholders, share he CA has ot otied a aedets hich split and reverse share split (consolidation of are effective fro st Apri shares iuted earis per share is coputed

146 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements - - - - 1.8 As at As at As at As at 935.2 809.6 1,069.1 1,058.0 17,210.8 17,210.8 43,655.5 31.03.2020 31.03.2020 Net Block Net Block ( ` in million) ( ` in million) - - 3,463.2 - - - - 1,904.7 0.9 4.4 22.0 35.5 46.6 As at As at As at As at 134.1 334.9 168.1 196.4 163.0 195.6 416.1 416.1 678.2 733.4 1,010.9 766.7 1,171.6 1,378.9 354.2 354.2 489.4 1,112.6 1,011.9 350.4 350.4 207.9 586.0 586.0 408.7 1,791.9 695.4 2,146.3 15,209.9 1,482.8 39,120.1 39,120.1 23,103.8 2,466.4 14,530.4 15,743.2 20,751.9 14,865.0 25,850.7 24,913.0 24,913.0 37,050.5 20,598.5 49,115.3 25,853.2 25,853.2 37,948.6 38,353.6 38,353.6 16,324.7 31.03.2020 31.03.2020 ------105.5- 337.6 38.5 62.1 ------1.1 2 7. 2 36.3 29.8 29.8 392.1 740.0 304.5 3,710.3 3,217.8 3,217.8 3,552.1 3,552.1 5,050.5 Subsidiaries Subsidiaries Disposals of Disposals of ------1.1 5.1 3.9 2.8 2.8 71.7 27.2 97. 5 18.0 49.9 49.8 66.3 179.7 3 07.7 Deductions Deductions ------3.1 6.7 3.0 0.5 0.4 1 7.9 15.2 48.8 (0.8) 66.0 (0.3) (0.4) (10.8) 40.9 933.5 933.5 929.4 929.4 47.6 rasatio rasatio rasatio rasatio Adjustments Adjustments - - - - 11.2 ------15.5 - - (1.1) - - - 28.7 88.5 - 12.8 1.8 143.5 725.8 1,940.6 - - - - (25.2) 4.9 - - 32.4- 22.4 - 44.1 109.0 - - 263.0 - - - - 433.3 387.1 - - - - Loss Loss Impairment Impairment 11.1 0.7 Accumulated Depreciation and Impairment Loss Depreciation Accumulated Accumulated Amortisation and Impairment Loss Accumulated 10.9 715.0 245.6 232.5 669.4 period period For the For For the For 6,244.6 ------858.3 - 105.5 - 38.4 -- - 4.4 1.0 0.9 24.6 35.5 137.5 72.4 As at As at 469.9 14,612.8 - - - - 2.7 26.4 As at As at As at As at 358.6 364.5 163.0 72.8 469.0 843.6 843.6 301.5 104.4 994.7 994.7 434.7 147.4 2,487.3 1,482.8 410.3 69,713.8 61,963.5 61,963.5 19,629.7 4,353.7 63,801.8 63,801.8 20,365.9 4,605.5 31.03.2020 31.03.2020 - - - 3,463.2 - - - 2,418.0 1,073.1 448.3 - 2,550.5 812.0 383.7 - 1,104.6 - 40,715.7 10,615.6 4,413.6 - 1,744.3 - - 17,356.2 1,479.1 - - - 443.1 - 100.6 - 1,104.6 - 2,124.5 733.4 313.2 - - - - - 1.6 97.1 45.2 808.3 2,666.4 2,663.7 16,996.8 2,146.3 Subsidiaries Subsidiaries Disposals of Disposals of ------1,664.9 1,904.7 - - - 1.9 5.9 73.5 75.2 76.3 60.0 89.6 89.6 462.0 558.3 586.0 128.7 275.0 Deductions Deductions ------2.1 0.4 4.7 3.4 19.7 1 7.9 97. 4 15.2 132.7 79.4 119.1 58.5 109.0 58.8 (0.5) 68.9 23.6 1,305.1 1,576.3 1,171.6 325.1 29.9 (0.8) Gross Block Gross Block rasatio rasatio rasatio rasatio Adjustments Adjustments - 4.4 76.8 24.5 26.4 367.1 107.5 Additions Additions ------3.2 74.4 76.0 9 97.1 As at As at 831.3 150.3 16.3 3.2 441.3 204.3 338.4 358.6 83.5 928.3 3.5 (40.2) 48.0 994.7 994.7 85.3 843.6 843.6 213.9 133.9 8.4 88.7 1,094.3 354.2 121.8 3,454.1 1,104.6 - 2,186.3 285.5 1,384.0 301.5 1,744.3 242.8 137.4 2,510.0 831.6 135.0 2,418.0 165.0 2,550.5 285.6 3,463.2 108.8 (2.4) 2,280.8 387.2 17,356.2 2,261.5 72,812.8 10,507.2 1,164.6 496.1 17,229.2 66,759.3 20,598.5 7,509.6 40,715.7 5,906.1 628.9 112.3 10,643.3 36,495.1 14,865.0 4,423.0 16,466.8 815.9 36,576.3 4,249.1 165.3 63,687.0 6,227.9 346.0 547.1 48,667.1 48,667.1 10,880.9 2,427.5 12.0 61,963.5 160.9 3,349.4 13.2 10,782.3 54,678.3 24,913.0 3,835.7 10,611.0 2,216.8 50,426.7 50,426.7 11,034.7 2,403.6 63.2 63,801.8 460.1 3,513.2 111.2 11,333.0 56,330.9 25,853.2 4,086.2 10,611.0 2,220.3 98.5 lant and Equipment P ntangibles Assets - Acquired roperty, roperty, Accumulated Amortization and Impairment Loss includes impairment loss in opening balance of ` ` iio previous iio ear` previous iio ad ear i cosi ` aace of iio or detais of ihtofuse asset efer ote Cost of uidis icudes cost of shares i cooperative societies of ` previous ear ` revious ear ures are ive i itaics eo curret ear ures i each cass of assets or detais o disposas of susidiaries efer ote Depreciation for the period includes ` iio previous ear ` iio reated discotiued to operatios Amortisation for the period includes ` iio previous ear ` iio reated discotiued to operatios or detais of pairet oss efer ote or detais o disposas of susidiaries efer ote revious ear ures are ive i itaics eo curret ear ures i each cass of assets Total Total Office Euipet Office of use Assets: Right Land Leasehold Buildings Leasehold & Furniture Leasehold Fixtures Vehicles Leasehold Office easehod Equipments Plant & Leasehold Equipment Particulars Software Computer ad iceces radears rights Dossiers/Marketing Freehold Land Freehold Buildings on Leased Improvements Premises Plant and Equipment and Fixtures Furniture Vehicles Particulars a c d) e 3. Other I a c) d) e 2. P

Lupin Limited | Annual Report 2019-20 147 Notes Forming part of the Consolidated Financial Statements

4. Investment Accounted For Using Equity Method

(` in million) Number Face Value As at As at 31.03.2020 Unquoted In Jointly Controlled Entity: iooics td apa 450 (450) * Total 305.0 251.8 * Shares do not have face value i) Investment in shares are fully paid up ii) Aggregate amount of unquoted investments iii) Aggregate amount for impairment in value of investments iv) Previous year numbers are within brackets below current year numbers

5. Non-Current Investments efer ote i (` in million) Number Face Value As at As at 31.03.2020 a) In Equity Instruments at air vaue throuh rot or oss Unquoted iotech Cosortiu dia td dia 50,000 ` (50,000) 10 Eviro frastructure Co td dia 100,000 ` (100,000) 10 haruch Eviro frastructure td dia 4,410 ` ` ` (4,410) 10 arada Cea ech td dia 1,100,388 ` (1,100,388) 10 arapur Eviroet rotectio ociet dia ` 100 apa edica roducts Exporters Associatio apa ` i ` (10) 5,000 he haraceuticas ad edica evices Aec apa (30) 10,000 Osaa ire utua Aid Associatio apa ` i ` (10) 100 rafurter osa e a era Eur ` i ` (10) 50 Atsui as Corporatio apa (600) * each Oe t td outh Africa 8,500,000 ZAR (8,500,000) 1

148 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) Number Face Value As at As at 31.03.2020 b) In Bonds/Debentures/Securities (at Amortised Cost) - Government Bonds Unquoted atioa Hihas Authorit of dia dia ` (500) 10,000 - Non Convertible Debentures Quoted ata Capita iacia ervices td dia ` (500) 1,000,000 Adita ira Housi iace td dia ` (500) 1,000,000 ota ahidra rie td dia ` (500) 1,000,000 - Government Securities Unquoted atioa avi Certicates eposited ith overet Authorit ` ` Total 55.7 1,604.5

* Shares do not have face value i) All investments in shares are fully paid up ii) Aggregate amount of quoted investments and market value thereof Book value Market value iii) Aggregate amount of unquoted investments iv) Previous year numbers are within brackets below current year numbers

6. Non-Current Loans (` in million) As at As at 31.03.2020 Unsecured, considered good Security Deposits ith eated arties efer ote C ith Others Loans to Employees Advance to Vendors Total 476.3 814.6 here are o other ocurret oas hich have siicat icrease i credit ris

7. Other Non-Current Financial Assets (` in million) As at As at 31.03.2020 Earmarked Bank Deposits against guarantees & other commitments Other oCurret iacia Assets icudes isceaeous receivaes etc Total 705.1 433.5

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

8. Other Non-Current Assets (` in million) As at As at 31.03.2020 Capital Advances Advances other than Capital Advances ith overet Authorities raac Custos ad Excise duties receivae Advace aaist ivestets Prepaid Expenses Other Advaces Total 2,458.3 1,825.2

9. Inventories (` in million) As at As at 31.03.2020 Raw Materials Packing Materials oriroress Finished Goods tocirade Consumable Stores and Spares oodsirasit a aterias aci aterias tocirade Cosuae tores ad pares Total 34,568.7 38,367.7 uri the ear the roup recorded ivetor ritedos of ` iio previous ear ` iio hese adustets ere icuded i cost of ateria cosued ad chaes i ivetories

10. Current Investments (` in million) As at As at 31.03.2020 - Measured at Amortised Cost Quoted In Non Convertible Debentures In Commercial Papers Unquoted In Commercial Papers

- Measured at Fair Value through Profit or Loss Unquoted In Mutual Funds Total 23,382.5 21,098.6

a) Aggregate amount of quoted investments and market value thereof Book value Market value b) Aggregate amount of Unquoted Investments c) Unrealised Loss on Mutual Fund Investments (net) as adjusted above

150 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

11. Trade Receivables

(` in million) As at As at 31.03.2020 Unsecured Cosidered ood Credit paired Less : Impairment Allowances for credit losses Total 54,459.3 51,498.0 here are o other trade receivaes hich have siicat icrease i credit ris efer ote C for iforatio aout credit ris ad aret ris for trade receivaes

12. Cash and Cash Equivalents (` in million) As at As at 31.03.2020 Cash ad Cash Euivaets as per d A tateet of Cash os Bank Balances Curret Accouts icudi oeitrasit EEC Accout eposit Accouts Cheques on hand Cash on hand Total 22,148.5 5,722.1

13. Other Bank Balances (` in million) As at As at 31.03.2020 Earmarked Balances with Banks paid divided accouts eposits aaist uaratees ad other coitets a eposits ith oriia aturit of ore tha oths ut ess tha oths from the balance sheet date Total 2,394.5 4,149.9

14. Current Loans (` in million) As at As at 31.03.2020 (Financial assets stated at cost) Unsecured, considered good Security Deposits Other oas ad Advaces icudes oas to epoees etc Total 370.1 248.4

here are o other curret oas hich have siicat icrease i credit ris

Lupin Limited | Annual Report 2019-20 151 Notes Forming part of the Consolidated Financial Statements

15. Other Current Financial Assets (` in million) As at As at 31.03.2020 Mark to Market Derivative Assets Export eets receivae ith overet Authorities ACevatervice tax creditrefud receivae Other Curret iacia Assets icudes terest receivaes etc Total 3,895.5 6,393.4

16. Other Current Assets (` in million) As at As at 31.03.2020 Advances other than Capital Advances Prepaid Expenses Advance to Employees Advance to Vendors Cosidered ood Credit paired Less: Impairment Allowances for Credit Impaired Advance against investments Export eets receivae ith overet Authorities ACevatervice tax creditrefud receivable) Assets Recoverable From Customers Other Curret Assets cudes isceaeous receivaes etc Total 12,606.9 10,760.9

17. Equity Share Capital a) Equity Share Capital Particulars As at 31.03.2020 As at No. of Shares ` in million o of hares ` in million Authorised Equity Shares of ` each 1,000,000,000 1,000,000,000 Issued, Subscribed and Paid up Equity Shares of ` each fu paid Total 452,998,121 906.0 452,493,697 905.0

b) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting period Particulars As at 31.03.2020 As at No. of Shares ` in million o of hares ` in million Equity Shares outstanding at the beginning of the year Equity Shares issued during the year 410,847 pursuat to exercise of EOs Equity Shares outstanding at the end of the year

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements c) Rights attached to Equity Shares he Copa has o oe cass of euit shares ith voti rihts havi a par vaue of ` per share he Copa decares ad pas divideds i dia upees he divided proposed the oard of irectors is suect to the approva of the sharehoders at the esui Aua eera eeti uri the ear eded arch the aout of divided per euit share distriuted to euit shareholders is ` previous ear eded arch ` In the event of liquidation of the Company, the shareholders of equity shares will be entitled to receive reaii assets of the Copa after distriutio of a preferetia aouts he distriutio i e i proportio to the uer of euit shares hed the sharehoders d) Details of shares held by each shareholder holding more than 5% equity shares Name of Shareholder As at 31.03.2020 As at No. of Shares Percentage of o of hares Percentage of Holding Holding upi vestets vt iited e) Shares reserved for issuance under Stock Option Plans of the Company Particulars As at 31.03.2020 As at No. of Shares ` in million o of hares ` in million Lupin Employees Stock Option a 106,030 a 33,045 a 1,316,500 a Lupin Subsidiary Companies Employees Stock Options a 100,568 a a 1,106,476 f) Aggregate number of shares issued during last five years pursuant to Stock Option Plans of the Company Particulars As at As at 31.03.2019 Aggregate No. Areate o of Shares of Shares Euit hares issued uder various toc Optio as of the Copa g) No shares have been allotted without payment being received in cash or by way of bonus shares duri the period of ve ears iediate precedi the aace heet date

Lupin Limited | Annual Report 2019-20 153 Notes Forming part of the Consolidated Financial Statements

18. Other Equity (` in million) As at As at 31.03.2020

Reserves and Surplus Capital Reserve Opei ad Cosi aace as per ast aace heet vestet usidies fro Cetra overet vestet usidies fro tate overet O restructuri of capita of the Copa uder the chee of Aaaatio Capital Redemption Reserve Opei ad Cosi aace as per ast aace heet Legal Reserve Opei ad Cosi aace as per ast aace heet Securities Premium Opei aace as per ast aace heet Add : Additions during the year* Balance as at the year end Employees Stock Options Outstanding [Refer note 44] Opei aace as per ast aace heet Add : Amortisation during the year Less : Exercised during the year ess rasfer to eera eserve Balance as at the year end General Reserve Opei aace as per ast aace heet Add rasfer fro share ased paets Balance as at the year end Retained Earnings Opei aace as per ast aace heet ess Adustet for trasitio to d A eases et off deferred tax efer ote ess Adustet for trasitio to Appedex C of d A coe axes efer ote f Add rot oss for the ear ess ia ivided o Euit hares efer ote c ess Corporate ax o ivided Balance as at the year end Amalgamation Reserve Opei ad Cosi aace as per ast aace heet Share Application money Pending allotment Other Comprehensive Income Foreign Currency Translation Reserve [Refer note 53] Opei aace as per ast aace heet Add / (Less) : Additions during the year Add ess ecassicatio to rot or oss o disposa of susidiaires Balance as at the year end Cash Flow Hedge Reserve [Refer note 61(C)] Opei aace as per ast aace heet Addess Effect of forei exchae rate variatios o hedi istruets outstadi et of deferred tax of ` iio previous ear ` iio Addess Hede effectiveess recoised i tateet of rot ad oss Balance as at the year end Actuarial Gain / (Loss) Opei aace as per ast aace heet Add / (Less) : Additions during the year Balance as at the year end Total 124,461.0 136,517.3 epresets aout received o aotet of previous ear Euit hares of the face vaue of ` each pursuat to upi Epoees toc Optio as efer ote epresets Corporate ax o ia ivided ` iio previous ear ` iio ad o divided paid for previous ear o Euit hares issued after ear ed pursuat to EOs aotet ` iio previous ear ` iio

154 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

Nature of Reserves arising on changes in fair value of designated a) Capital Reserve portion of hedging instruments entered into for he Capita reserve is created o receipts of Cash o hedes he cuuative ai or oss government grants for setting up the factories in arising on changes in fair value of the designated backward areas for performing research on critical portion of the hedging instruments that are medicines for the betterment of the society and recognised and accumulated under the heading of on restructuring of the Capital of the Company cash o reserve i e recassied to stateet uder various schees of Aaaatio of prot ad oss o he the heded ites affect the prot or oss b) Capital Redemption Reserve his reserve represets redeptio of redeeae g) Legal Reserve cuuative preferece shares i earier ears his reserve represets appropriatio of certai percetae of prot as per the oca statutor c) Securities Premium reuireet of fe susidiaries Securities premium account comprises of the preiu o issue of shares he reserve is utiised h) Foreign Currency Translation Reserve i accordace ith the specic provisio of the his reserve represets exchae differeces Copaies Act arising on account of conversion of foreign operatios to Copas fuctioa currec d) General Reserve he eera reserve is used fro tie to tie i) Employees Stock Options Outstanding to trasfer prots fro retaied earis for he Copa has epoee stoc optio schees appropriatio purposes As the eera reserve under which the option to subscribe for the is created by a transfer from one component Company's shares have been granted to certain of equity to another and is not an item of other epoees ad directors his is used to recoie coprehesive icoe the vaue of euitsetted shareased paets provided to the employees as part of their e) Amalgamation Reserve reueratio his reserve represets creatio of aaaatio reserve pursuant to the scheme of amalgamation j) Share Application money Pending allotment etee ersthie upi aoratories td ad the Share Application money represents amount Copa received towards share application money which were pedi for aotet as o reporti date f) Cash Flow Hedge Reserve he cash o hede reserve represets the cuuative effective portio of ais or osses

Lupin Limited | Annual Report 2019-20 155 Notes Forming part of the Consolidated Financial Statements

19. Non-Current Borrowings efer ote (` in million) As at As at 31.03.2020 Secured er oas fro as o er aturities of iace ease Oiatios efer ote Unsecured er oas fro as eferred aes ax oa fro overet of aharashtra Total 17,932.8 66,417.2 a ecured er oa of ` iio of a susidiar ocated i rai carries xed iterest rate of pa ad oati iterest rate of pus pa oa is secured aaist ortae of iovae propert of that susidiar copa his oa is repaae ti a

b) Unsecured Loans of ` iio of susidiar copa ocated i exico carries xed iterest rate i the rae of to pa ad uarateed the Copa Of this oa of ` iio is paae ti eruar ad aace ` iio is repaae ti a c) Unsecured Loans of ` iio of susidiar copa ocated i A carries iterest rate of pus O ad uarateed the Copa Of this oa of ` iio is paae o a and balance ` iio is repaae o a d eferred aes ax oa is iterest free ad paae i aua istaets after expir of iitia ears oratoriu period fro each such ear of deferra period eii fro to ad edi fro to e he roup has ot defauted o repaet of oas ad iterest duri the ear

20. Trade Payables (` in million) As at As at 31.03.2020 ota outstadi dues of icro ad a Eterprises efer ote ota outstadi dues of other tha icro Eterprises ad a Eterprises Total - 22.8

21. Other Non-Current Financial Liabilities (` in million) As at As at 31.03.2020 Mark to Market Derivative Liabilities Payable for Capital Expenditure aae for urchase of oCurret vestet Epoee eets aaes ease iaiit o Curret efer ote Other aaes Total 7,247.3 4,128.6

156 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

22. Non-Current Provisions (` in million) As at As at 31.03.2020 rovisios for Epoee eets efer ote ratuit efer ote etireet eets Compensated Absences Provident Fund Other rovisios Asset etireet Oiatio Others Total 2,962.9 3,707.9

23. Other Non-Current Liabilities (` in million) As at As at 31.03.2020 eferred eveue efer ote Deferred Government Grant Total 1,636.5 3,144.8

24.Current Borrowings (` in million) As at As at 31.03.2020 Secured Loans from Banks Unsecured Loans from Banks Total 24,927.5 15,802.1 a) Secured loans of ` iio coprise of Cash Credit ad ori Capita ead oa ad are secured hpothecatio of ivetories ad oo dets ad carr iterest rate at C pus aret drive aris b) Secured Loans of ` iio ei oas avaied a susidiar copa ocated i Austraia ad carries iterest rate pa ad is secured xed ad oati chare over a assets of the said susidiar ad are uarateed the Copa c) Secured Loans of ` iio avaied a susidiar copa ocated i rai ad carries xed iterest rate i the rae of to ad variae iterest rate of pa d) Secured Loans of ` iio ei oas avaied a susidiar copa ocated i outh Africa are secured xed deposits i a of said susidiar ad carries iterest rate i the rae of to pa e) Unsecured Loans of ` iio avaied a susidiar copa ocated i rai ad carries xed iterest rate i the rae of to ad variae iterest rate of pa f) Unsecured Loans of ` iio avaied a susidiar copa ocated i A ad carries iterest rate at O plus market driven margin and of this loan of ` is uarateed the Copa he roup has ot defauted o repaet of oas ad iterest duri the ear

Lupin Limited | Annual Report 2019-20 157 Notes Forming part of the Consolidated Financial Statements

25. Trade Payables (` in million) As at As at 31.03.2020 Acceptances Other tha Acceptaces ota outstadi dues of icro Eterprises ad a Eterprises efer ote ota outstadi dues of other tha icro Eterprises ad a Eterprises Total 24,123.0 24,981.8

26. Other Current Financial Liabilities (` in million) As at As at 31.03.2020 Curret aturities of oCurret orrois efer ote er oas fro as eferred aes ax oa fro overet of aharashtra er oas fro Couci of cietic ad dustria esearch C Interest Accrued but not due on Borrowings Unpaid Dividend * Mark to Market Derivative Liabilities Payable for Capital Expenditure aae for urchase of oCurret vestet rade eposits received Epoee eets aaes ease iaiit Curret efer ote Other aaes cudes retetio oe etc Total 28,759.8 10,885.3

* During the period ` iio has ee credited to vestor Educatio ad rotectio ud reati to

2 7. Other Current Liabilities (` in million) As at As at 31.03.2020 tatutor ues aaes icudes rovidet ud ithhodi axes etc eferred eveue efer ote Deferred Government Grant Advances from customers Other aaes Total 2,482.5 1,912.9

158 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

28.Current Provisions (` in million) As at As at 31.03.2020 rovisios for Epoee eets efer ote ratuit efer ote etireet eets Compensated Absences

Other rovisios or aes eturs efer ote a or Europea Coissio ie efer ote d ad Total 9,077.1 7,274.5

29. Revenue from Operations (` in million) For the Current For the Previous Year ended Year ended 31.03.2020 ae efer ote Goods Research Services Other Operati eveue Export eets ad Other cetives Service Charges Insurance Claims Business Compensation and Settlement Income Miscellaneous Income Total 153,747.6 146,645.6

30.Other Income (` in million) For the Current For the Previous Year ended Year ended 31.03.2020 Income on Financial Assets carried at amortised cost Interest on Deposits with Banks Other terest coe o iacia Assets carried at fair vaue throuh rot or oss Dividend on Mutual Fund Investments Net gain on Sale of Mutual Fund Investments Unrealised Gain on Mutual Fund Investments (net) et ai o orei Currec rasactios Exchae ate ifferece et Provisions / Credit balances no longer required written back rot o ae of ropert at Euipet taie Assets et Other oOperati coe icudi iterest o icoe tax refud Total 4,837.6 3,330.1

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

31. Cost of Materials Consumed (` in million) For the Current For the Previous Year ended Year ended 31.03.2020 Raw Materials Consumed Packing Materials Consumed Total 31,638.2 31,459.6

32. Changes in Inventories of Finished Goods, Work-In-Progress and Stock-In-Trade [(Increase)/Decrease] (` in million) For the Current For the Previous Year ended Year ended 31.03.2020 Opei toc Finished Goods tocirade oriroress Less: Closing Stock: Finished Goods tocirade oriroress Changes In Inventories: Finished Goods tocirade oriroress orei Currec rasatio ifferece Total 85.5 (2,044.5)

33. Employee Benefits Expense (` in million) For the Current For the Previous Year ended Year ended 31.03.2020 Salaries and Wages Cotriutio to rovidet ad Other uds etireet eets Expese hare ased paet expese efer ote taff efare Expeses Total 29,868.4 27,701.7

160 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

34.Finance Costs (` in million) For the Current For the Previous Year ended Year ended 31.03.2020 terest o iacia iaiities orrois carried at aortised cost et terest o et deed eet iaiit terest o coe ax terest cost o ace ease oiatio Other orroi Costs icudes a chares etc Total 3,629.8 3,024.9

35. Other Expenses (` in million) For the Current For the Previous Year ended Year ended 31.03.2020 Processing Charges Stores and Spares Consumed Repairs and Maintenance: uidis at ad achier Others et ad Other Hire Chares efer ote ates ad axes Insurance Power and Fuel Contract Labour Charges Selling and Promotion Expenses Commission and Brokerage Freight and Forwarding ostae ad eephoe Expeses ravei ad Coveace Legal and Professional Charges et of recoveries of ` nil (previous year ` iio Donations Clinical and Analytical Charges ad rade eceivaes Advaces ritte off et of provisio of earier ears adusted ` iio previous ear ` iio pairet Aoaces for outfu rade eceivaes Advaces et Provision for Impairment of Intangible Assets/ Intangible Assets Under Development pairet i vaue of oCurret ivestets Corporate ocia esposiiit Expeses efer ote Directors Sitting Fees Exchae ate ifferece et Business Compensation and Settlement Expenses Miscellaneous Expenses Total 46,025.2 43,875.8

Lupin Limited | Annual Report 2019-20 161 Notes Forming part of the Consolidated Financial Statements

36. he Cosoidated iacia tateets preset the cosoidated accouts of upi iited the Company”) and its following subsidiaries and its jointly controlled entity (“the Group”): ae of usidiariesoit cotroed etit Country of roportio of Oership terest Incorporation As at As at 31.03.2020 upi haraceuticas c USA 1 1 oa haraceutica dustr Co iited upto eceer apa oa CritiCare Co iited upto epteer apa 3 Hormosan Pharma GmbH Germany Pharma Dynamics (Proprietary) Limited South Africa Lupin Australia Pty Limited Australia aoi forer o as upi Hodis Netherlands Lupin Atlantis Holdings SA Switzerland uticare haraceuticas hiippies c Philippines Generic Health Pty Limited Australia Bellwether Pharma Pty Limited Australia 4 4 Lupin Healthcare (UK) Limited UK 5 5 Lupin Pharma Canada Limited Canada 5 5 Lupin Healthcare Limited India upi exico A de C Mexico upi hiippies c Philippines eeric Heath H Malaysia upi idde East C uder iuidatio UAE 5 5 Lupin GmbH Switzerland 5 5 upi c USA 5 aoratorios ri A de C Mexico 5 eduica dstria aracutica A Brazil 6 6 upi hara C upto Apri Russia 6 avis haraceuticas C upto arch USA 7 ove aoratories c USA 7 7 upi esearch c USA 7 7 YL Biologics Limited apa 8 8 upi raie C upto eruar Ukraine 6 upi ata c USA 5 5 upi apa Asia acic apa 5 5 Lupin Europe GmbH Germany 5 5 ioix herapeutics C upto eceer USA 10 upi aaeet c forer o as upi etures c USA 7 7

1 Oership iterest hed throuh upi c A Oership iterest hed throuh aoi etherads 3 Oership iterest hed throuh oa haraceutica dustr Co iited apa 4 ho oed susidiar of eeric Heath t iited Austraia 5 Oership iterest hed throuh upi Atatis Hodis A iterad 6 Oership iterest hed throuh upi Atatis Hodis A iterad ad aoi etherads 7 ho oed susidiaries of upi c A 8 oit Cotroed Etit of upi Atatis Hodis A iterad ith oshido c apa havi share of iterest Oership iterest hed throuh upi Atatis Hodis A iterad ad upi exico AdeC etherads 10 ho oed susidiar of upi aaeet c A aoi etherads hich as ho oed susidiar of upi Atatis Hodis A iterad ot ered ith upi Hodis etherads ad its ae chaed to aoi etherads o Octoer ith effective fro Apri

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

3 7. Commitments: a) Estimated amount of contracts remaining to be executed on capital account and not provided for, net of advaces aie assets ` iio previous ear ` iio ad taie assets ` iio (previous year ` iio Other coitets ocaceae eases efer ote c here are o capita coitets at the oit cotroed etit of the roup as at d) Dividends proposed of ` previous ear ` per euit share efore the acia stateets ere approved for issue ut ot recoised as a iaiit i the acia stateets is ` iio previous ear ` iio e here are product supp coitets pursuat to cotracts ith custoers uder dossier areeets f iacia ad corporate uaratees issued the Copa o ehaf of susidiaries are discosed i ote

38.Contingent Liabilities: (` in million) As at As at 31.03.2020 a) Income tax demands/matters on account of deductions / allowances in earlier years, pending in appeals and potential tax demands in future years in respect of soe ucertai tax issues ` iio previous ear ` iio coseuet to department preferring appeals against the orders of the Appellate Authorities passed i favour of the copa Aout paid there aaist ad icuded uder oCurret ax Assets et ` iio previous ear ` iio b) Customs Duty, Excise duty, Service tax and Sales tax demands for input tax credit disaoaces ad dead for additioa Etr ax arisi fro dispute o appicae rate are i appeas ad pedi decisios Aout paid there aaist ad icuded uder ote Other oCurret Assets ` iio previous ear ` iio c) Claims against the Company not acknowledged as debts (excluding interest where the amount is unascertainable) for transfer charges of land, octroi duty, employee claims, power*, trademarks, pricing and stamp duty and price reported under edicaid for oe susidiar Amount paid there against without admitting liability and included under note 8 Other oCurret Assets ` iio previous ear ` iio *Demand raised by Maharashtra State Electricity Development Corporation Limited (MSEDCL) challenging Group Captive Generating Plant (GCGP) status of power suppiers pat at arapur ad ue ocatio d) Financial guarantee aggregating to ` iio previous ear ` iio ive to third part o ehaf of susidiaries for cotractua oiatios e) he Hoe upree Court of dia C their order dated eruar i the case of ura oshi iited others vs EO set out the pricipes ased o hich aoaces paid to the epoees shoud e idetied for icusio i asic aes for the purposes of coputatio of rovidet ud cotriutio useuet a revie petitio aaist this decisio has ee ed hich is o disissed vie of the aaeet the iaiit for the period fro date of the C order to arch is ot siicat f) upi haraceuticas c a stepdo ho oed susidiar of the Copa is ivoved i overet ivestiatios ad itiatio arisi fro the areti ad prootio of its pharaceutica products i the ited tates auar ad oe of its epoees ere issued supoeas epartet of ustice O reuesti docuets as part of Os ivestiatio ito possie atitrust vioatios ithi the eeric dru idustr has ee cooperati i the ooi ivestiatio Apri as aed i oth cass actio ad idividua cases ased o aeatios of aticopetitive ehavior reated to certai products ad oe of its epoees received a opart supoea fro the state of Coecticut Attore eera CA reated to a civi atitrust case the ed i reuesti docuets ad other iforatio a state attores eera ed the CA ed a secod asuit aaist copaies icudi upi haraceuticas c ad idividuas ith aeatios of vioatios of federa ad state atitrust as he states cai to have ee iured pai supracopetitive prices for the products the purchased or reiursed hese civi asuits were combined into the collection of similar cases referred to as In Re Generic Pharmaceuticals Antitrust Litigation, located i hiadephia esvaia As the case is sti i the ear stae a estiate of the possie oss or rae of oss if a caot e ade

Lupin Limited | Annual Report 2019-20 163 Notes Forming part of the Consolidated Financial Statements

g) arch upi c a step do susidiar of the Copa acuired of the euit iterest i avis ad ove aoratories c ove uder a hare urchase Areeet A As part of the A paced iio i a ideit escro accout i case the seers of ove reach certai represetatios ad arraties der the ters of the A is ideied for the daaes fro such reaches uder certai coditios arch A oa c A a pharaceutica research ad aufacturi oraiatio ed a asuit aaist ove for preacuisitio ehaviors recorded a accrued ea setteet ad ideicatio asset of iio uri the third uarter of sca ear setted the case ith A for iio is curret seeking recovery of the settlement, along with other damage claims in a lawsuit in New York against the Novel seers o tria date has ee set the court s aaeet ad ea tea eieve the setteet aout oud e foud reasoae the court As of arch had paid off the ea setteet aout ad the ideicatio asset of iio as icuded i Other ocurret acia assets i the cosoidated aace heet h) ro tie to tie upi c ad its susidiaries are ivoved i various iteectua propert cais ad ea proceedis hich are cosidered ora to its usiess oe of this itiatio has ee resoved throuh setteet areeets ith the paitiffs epteer severa atitrust cass actios ere ed i the orther istrict of Caiforia aaist the aufacturers icudi ad of diaetes treatet ueta he asuits aee that a setteet of a patet itiatio reardi ueta deaed the avaiaiit of eeric ateratives to ueta hich caused cosuers to pa supracopetitive prices for the dru hese cass actio cases see various fors of iuctive ad oetar reief icudi daaes ased o the differece etee the rad price ad hat the eeric price aeed oud have ee ad disoreet of prots he aeed daaes ca e sustatia potetia easured i utipes of the aua product saes eieves that its setteet areeet is afu ad served to icrease copetitio ad has defeded the viorous roups experiece to date these cases have typically settled for a fraction of the high end of the damages sought, although there can be no assurance that such outcoes i cotiue As the cases are sti i the ear stae a estiate of the possie oss or rae of oss if a caot e ade

**he exas Attore eeras office served upi haraceuticas c ith severa Civi vestiative eads fro a ad cotiui throuh he tate of exas the tate ed a asuit aaist upi td upi c ad certai executives o ue the Oriia asuit aei vioatios of the exas edicaid raud revetio Act A uri the ear the tate offered a setteet of iio to upi roup of hich iio as aread accrued i earier ears der the setteet areeet the tate ad upi roup had areed o a of the ters of the setteet ad the tate areed to disiss the idividua defedats iediate ia paet of iio ` iio ad iio ade duri the ear

here are o cotiet iaiities at the oit cotroed etit of the roup as at uture cash outos i respect of the aove if a is deteriae o o receipt of udeet decisios pedi ith the reevat authorities he roup does ot expect the outcoe of the atters stated aove to have a ateria adverse ipact o the roups acia coditio resuts of operatios or cash os he roup does ot evisae a ie reiurseets i respect of the aove he roup is ivoved i various ea proceedis icudi cais aaist the roup pertaii to coe tax Excise Custos aesA tax product iaiit reated cais epoet cais ad other reuator atters reati to coduct of its usiess he roup has revieed a its pedi litigations and proceedings and has adequately provided for where provisions are required and disclosed as cotiet iaiit here appicae i the Cosoidated iacia tateets he roup carries product iaiit isurace poic ith a aout it eieves is sufficiet for its eeds respect of other cais the roup eieves that the proaiit of outo is o to oderate cosideri the erits of the case ad the utiate dispositio of these atters a ot have ateria adverse effect o its Cosoidated iacia tateets

164 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

39. Expediture icurred prior to coeceet of coercia productio icuded i Capita orroress represet direct attriutae expediture for setti up of pats he sae i e capitaised o copetio of proects ad coeceet of coercia operatios he detais of the preoperative expeses are (` in million) Particulars 2019-2020 Opei aace Incurred during the year: Salaries, allowances and contribution to funds Legal and Professional Charges ravei ad Coveace Power and fuel Others ota icurred duri the ear Less: Capitalised during the year Closing balance

40. Revenue (Ind AS 115) A he operatios of the roup are iited to oe seet vi pharaceuticas ad reated products Revenue from contract with customers is from sale of manufactured goods and rendering of research services ae of oods are ade at a poit i tie ad reveue is recoised upo satisfactio of the perforace oiatios hich is tpica upo dispatch deiver he roup has a credit evauatio poic ased o hich the credit iits for the trade receivaes are estaished here is o siicat aci copoet as the credit period provided the roup is ot siicat coe fro research services icudi sae of techoo oho rihts iceses ad other intangibles) is recognized in accordance with the terms of the contract with customers when the related perforace oiatio is copeted or he riss ad reards of oership are trasferred as appicae he Copa eters ito certai dossier saes icesi ad supp arraeets that i certai istaces icude certai perforace oiatios ased o a evauatio of hether or ot these oiatios are inconsequential or perfunctory, the Company recognise or defer the upfront payments received under these arraeets ariae copoets such as discouts chareacs reates saes returs etc cotiues to e recoised as deductios fro reveue i copiace ith d A B. Disaggregation of revenue: (` in million) Nature of segment 2019-2020 A. Major Product/Service line: ae of pharaceutica oods coe fro research services ad sae of s usiess Copesatio etteet icoe ota reveue fro cotracts ith custoers B. Primary geographical market: dia A apa Others ota reveue fro cotracts ith custoers C. Timing of the revenue recognition: oods ervices trasferred at a poit i tie ervices trasferred over tie ota reveue fro cotracts ith custoers

Lupin Limited | Annual Report 2019-20 165 Notes Forming part of the Consolidated Financial Statements

C. Reconciliation of revenue as per contract price and as recognised in statement of profit and loss: (` in million) Particulars 2019-2020 Revenue as per contracted price Adjusted for: aes etur iscouts Chareacs eates Others Total revenue from contracts with customers 151505.6 144047.1

D. Reconciliation of revenue recognised from Contract liability (` in million) Particulars 2019-2020 Balance in contract liability at the beginning of the year that was not recognized as revenue Add: Increases due to cash received during the year excluding amounts recognized as revenue during the year Less: Revenue recognized that was included in the contract liability balance at the beginning of the year Balance in contract liability at the end of the year that is not recognized as revenue

41. Operating Segments: A. Basis for segmentation he operatios of the roup are iited to oe seet vi haraceutica ad reated products he products ei sod uder this seet are of siiar ature ad coprises of pharaceutica products o he Copas Chief Operati ecisio aer CO revies the itera aaeet reports prepared ased o areatio of acia iforatio for a etities i the roup adusted for itercopa eiiatios adustets etc o a periodic asis for the purpose of aocatio of resources ad evauatio of perforace Accordi aaeet has idetied pharaceutica seet as the o operati seet for the Copa B. Geographic information he eoraphic iforatio aases the roups reveues ad ocurret assets the Copas coutr of doicie ad other coutries preseti eoraphic iforatio seet reveue has been based on the selling location in relation to sales to customers and segment assets are based on eoraphica ocatio of assets

a) Revenue from operations (` in million) Particulars Year ended Year ended 31.03.2020 India USA apa Others 153747.6 146645.6

166 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements b) Non-current assets (other than financial instruments and deferred tax assets) (` in million) Particulars As at As at 31.03.2020 India USA apa Others 92953.2 132932.6 C. Major customer Revenue from the largest customer based in USA represented ` iio previous ear ` iio out of the roups tota reveues

42.Basic and Diluted Earnings per Share is calculated as under: a) For continuing operations: Particulars Year ended Year ended 31.03.2020 et rot efore ocotroi iterest attriutae to euit sharehoders ` in million) Weighted average number of Equity Shares: asic Add iutive effect of epoees stoc optios EOs coverted duri the ear ad EOs outstadi as at the ear ed iuted 454116633 Earnings per Share (in `) asic iuted b) For discontinued operations: Particulars Year ended Year ended 31.03.2020 et rot efore ocotroi iterest attriutae to euit sharehoders ` in million) Weighted average number of Equity Shares: asic Add iutive effect of epoees stoc optios EOs coverted duri the ear ad EOs outstadi as at the ear ed iuted 454116633 Earnings per Share (in `) asic iuted c) For Continuing and discontinued operations Particulars Year ended Year ended 31.03.2020 et rot after ocotroi iterest attriutae to euit sharehoders ` in million) Weighted average number of Equity Shares: asic Add iutive effect of epoees stoc optios EOs coverted duri the ear ad EOs outstadi as at the ear ed iuted 454116633 Earnings per Share (in `) asic iuted

Lupin Limited | Annual Report 2019-20 167 Notes Forming part of the Consolidated Financial Statements

43.Leases he roup eases office euipets vehices furiture xtures pat euipets ad office preises he eases tpica ru for the period etee oths to oths ith a optio to ree the ease after that date revious these eases ere cassied as operati eases uder d A A usidiar ocated i outh Africa procured ehices hich as cassied as ace ease uder d A (Refer note i) Information about leases for which the Group is lessee is presented below: i) Right of use assets efer ote (` in million) Particulars As at 01.04.2019 Carrying amount of: ihtofse ad ihtofse uidis ihtofse at Euipet ihtofse uriture ixtures ihtofse ehices ihtofse Office Euipet Total 4169.9

(` in million) Particulars Right-of-Use: Right-of-Use: Right-of- Right-of-Use: Right-of-Use: Right-of- Total Land Buildings Use: Plant & Furniture & Vehicles Use: Office Equipment Fixtures Equipment Cost Balance at April 1, 2019 4206.3 Additions Disposal / Derecognized during the year rasatio adustets Balance at March 31, 2020 4810.1

Accumulated depreciation Balance at April 1, 2019 36.4 Depreciation expense Disposal / Derecognized during the year rasatio adustets Balance at March 31, 2020 1054.9 Balance at March 31, 2020 1058.0 1940.6 22.0 337.6 334.9 62.1 3755.2 Balance at April 1, 2019 1069.1 2510.0 - 76.0 440.4 74.4 4169.9

Lease liabilities (` in million) Particulars Right-of-Use: Right-of-Use: Right-of- Right-of-Use: Right-of-Use: Right-of- Total Land Buildings Use: Plant & Furniture & Vehicles Use: Office Equipment Fixtures Equipment Balance at April 1, 2019 Addition Accretion of interest (refer ote Payments Adjustments for Disposals rasatio adustet Balance at March 31, 2020 110.0 2301.4 22.5 357.9 338.8 67.4 3198.0 Current (refer note 26) 5.3 634.7 8.4 104.8 183.3 35.6 972.1 Non-current (refer note 21) 104.7 1666.7 14.1 253.1 155.5 31.8 2225.9 he aturit aasis of the ease iaiit is icuded i the efer ote oii iacia ris aaeet oectives ad poicies uder aturities of acia iaiities

168 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

Amounts recognised in Statement of Profit and Loss (` in million) Particulars As at 31.3.2020 epreciatio expese of rihtofuse assets efer ote o terest expese o ease iaiities efer ote o Expese reati to shortter eases efer ote o Expese reati to o vaue assets efer ote o Total 1651.1 ii) Financial risk management (A) Maturities of financial liabilities he tae eo aae the roups acia iaiities ito reevat aturit aasis ased o their cotractua aturities for a acia iaiities he aouts discosed i the tae are the cotractua udiscouted cash os (` in million) Contractual maturities of financial liabilities Less than More than Total 1 Year 1 Year As at March 31, 2020 Lease liabilities iii) Commitments and contingencies he roup has ot etered ito ease cotract that have ot et coeced as at arch Coitet i respect of ocaceae short ter eases is ` iio Commitment in respect of low value leases is ` iio iv) Changes in accounting policies and disclosures New and amended standards and interpretations d A as otied ith effect fro Apri hich repaces d A d A sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to recoise ost eases o the aace sheet essor accouti uder d A is sustatia uchaed fro d A essors i cotiue to cassif eases as either operati or ace eases usi siiar pricipes as i d A herefore d A did ot have a ipact for eases here the roup is the essor he roup adopted d A usi the odied retrospective ethod of adoptio ith the date of iitia appicatio of Apri der this ethod the stadard is appied retrospective ith the cuuative effect of iitia appi the stadard recoised at the date of iitia appicatio he effect of adoptio d A as at Apri icreasedecrease is as foos Assets Amount ` in million ihtofuse assets eferred ax Assets Total assets 3224.5

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

Liabilities Amount ` in million iacia iaiities ease iaiities Lease Equalization Liability Deferred tax liabilities o er rovisios Total liabilities 3543.8

Total adjustment on equity Amount ` in million Retained earnings (Refer note 18) Total 319.3

As at the date of iitia appicatio of d A ie Apri iht of se assets ad ease iaiities ere measured at ` iio ad ` iio respective

he differece etee iht of use assets ao ith eae euaiatio iaiit ad ease iaiities icudi o ter provisios as recoised i etaied earis eferred ax Asset of ` iio as recoied o etaied earis

v) The lease liabilities as at April 1, 2019 can be reconciled to the operating lease commitments as of March 31, 2019 is as follows: Particulars Amount ` in million Assets Operati ease coitets as at arch iscouted operati ease coitets as at Apri iace ease iaiities recoised as at arch Less: Coitets reati to shortter eases Add: Lease payments relating to renewal periods not included in operating lease coitets as at arch Lease liabilities as at April 1, 2019 3687.3

eihted averae icreeta orroi rate as at Apri is

44.Share-based payment arrangements: Employee stock options – equity settled he Copa ipeeted upi Epoees toc Optio a EO upi Epoees toc Optio a EO upi usidiar Copaies Epoees toc Optio a EO upi Epoees toc Optio a EO upi usidiar Copaies Epoees toc Optio a EO upi Epoees toc Optio a EO ad upi usidiar Copaies Epoees toc Optio a EO i earier ears as approved the Shareholders of the Company and the Remuneration/Compensation/Nomination and Remuneration Committee of the oard of irectors the Coittee he Coittee deteries hich eiie epoees i receive optios the uer of optios to e rated the vesti period ad the exercise period he optios are rated at a exercise price hich is i accordace ith the reevat E uideies i force at the tie of such rats Each optio etites the hoder to exercise the right to apply for and seek allotment of one equity share of ` each he optios issued uder the aove

170 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements schemes vest in a phased manner after completion of the minimum period of one year with an exercise period of te ears fro the respective rat dates

Category A - Fair Market Value of Options (comprising of options granted under ESOP 2003, ESOP 2005, SESOP 2005, ESOP 2011, SESOP 2011, ESOP 2014 and SESOP 2014) Current Year Particulars Shares arising Range of Weighted Weighted out of options exercise prices average exercise average remaining os (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear Add Optios rated duri the ear 40000 ess Optios apsed duri the ear NA ess Optios exercised duri the ear NA Optios outstadi at the ear ed Exercisable at the end of the year

Previous Year Particulars Shares arising Range of Weighted Weighted out of options exercise prices average exercise average remaining os (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear Add Optios rated duri the ear ess Optios apsed duri the ear NA ess Optios exercised duri the ear NA Optios outstadi at the ear ed Exercisable at the end of the year

he eihted averae rat date fair vaue of the optios rated uder Cateor A duri the ears eded arch ad as ` ad ` i per optio respective

Category B - Par Value Options (comprising of options granted under ESOP 2014) Current Year Particulars Shares arising Range of Weighted Weighted out of options exercise prices average exercise average remaining os (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear Add Optios rated duri the ear ess Optios apsed duri the ear 113431 NA ess Optios exercised duri the ear NA Optios outstadi at the ear ed Exercisable at the end of the year

Previous Year Particulars Shares arising Range of Weighted Weighted average out of options exercise prices average exercise remaining os (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear 1318808 Add Optios rated duri the ear 876156 ess Optios apsed duri the ear 113307 NA ess Optios exercised duri the ear 318733 NA Optios outstadi at the ear ed Exercisable at the end of the year

he eihted averae rat date fair vaue of the optios rated uder Cateor duri the ears eded arch ad as ` ad ` per optio respective

Lupin Limited | Annual Report 2019-20 171 Notes Forming part of the Consolidated Financial Statements

Category C - Discounted Fair Market Value Options (comprising of options granted under ESOP 2003, ESOP 2005 and ESOP 2011) Current Year Particulars Shares arising Range of Weighted Weighted average out of options exercise prices average exercise remaining contractual os (`) price (`) life (Yrs) Optios outstadi at the eii of the ear Add Optios rated duri the ear ess Optios apsed duri the ear NA ess Optios exercised duri the ear NA Optios outstadi at the ear ed Exercisable at the end of the year

Previous Year Particulars Shares arising Range of Weighted Weighted average out of options exercise prices average exercise remaining os (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear Add Optios rated duri the ear ess Optios apsed duri the ear NA ess Optios exercised duri the ear NA Optios outstadi at the ear ed Exercisable at the end of the year

he eighted average grant date fair value of options granted under Category C during the years ended arch ad as ` nil and ` i per optio respective he eihted averae share price duri the ear eded arch ad as ` ad ` per share respective Valuation of stock options he fair vaue of stoc optios rated duri the period has ee easured usi the acchoes optio prici ode at the date of the rat he acchoes optio prici ode icudes assuptios reardi divided ieds expected voatiit expected ters ad ris free iterest rates he e iputs ad assuptios used are as follows: Share Price: he cosi price o E as o the date of rat has ee cosidered for vaui the optios rated Exercise Price: Exercise Price is the market price or face value or such other price as determined by the eueratio ad Copesatio Coittee Expected Volatility: he historica voatiit of the stoc ti the date of rat has ee cosidered to cacuate the fair vaue of the optios Expected Option Life: Expected Life of option is the period for which the Company expects the options to be ive he iiu ife of a stoc optio is the iiu period efore hich the optios caot e exercised ad the axiu ife is the period after hich the optios caot e exercised Expected dividends: Expected dividend yield has been calculated as an average of dividend yields for four years precedi the date of the rat Risk free interest rate: he ris free iterest rate o the date of rat cosidered for the cacuatio is the interest rate applicable for a maturity equal to the expected life of the options based on the zero coupon yield curve for overet ecurities hese assuptios reect aaeets est estiates ut these assuptios ivove iheret aret ucertaities ased o aret coditios eera outside of the Copas cotro As a resut if other assuptios had ee used i the curret period stocased copesatio expese coud have ee ateria

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements ipacted urther if aaeet uses differet assuptios i future periods stoc ased copesatio expese coud e ateria ipacted i future ears he estiated fair vaue of stoc optios is chared to icoe o a straihtie asis over the reuisite service period for each separate vesti portio of the aard as if the aard as isustace utipe aards

he eihted averae iputs used i coputi the fair vaue of optios rated ere as foos

Weighted average information 2019-2020

Category Grant date Exercise Risk free Expected Expected Dividend Weighted Weighted price rate life (years) Volatility ied average Optio share price Fair Value

A Apri B a B u B u A Octoer B oveer B eceer B eceer B eceer B eruar B eruar B eruar

Category eihted Averae Optio air aue Weighted Average Share Price A B

Weighted average information 2018-2019

Category Grant date Exercise Risk free Expected Expected Dividend Weighted Weighted price rate life (years) Volatility ied average Optio share price Fair Value

B Apri B Apri B Apri B Auust B Auust B epteer B epteer B epteer B oveer B oveer B oveer B auar B auar B auar B auar B eruar B eruar

Category eihted Averae Optio air aue Weighted Average Share Price B

Lupin Limited | Annual Report 2019-20 173 Notes Forming part of the Consolidated Financial Statements 45. Post-Employment Benefits: deed eet pa for uaifi epoees (i) Defined Contribution Plans: he schee provides for paet as uder he roup aes cotriutios toards providet i O ora retireet ear retireet fund, superannuation fund and other retirement withdrawal / resignation: eets to a deed cotriutio retireet As per the provisions of the Payment of eet pa for uaifi epoees der the ratuit Act ith vesti period of plan, the Group is required to contribute a ears of service specied percetae of paro cost to the ii O death i service retireet eet pa to fud the eets As per the provisions of the Payment of he roup recoised ` iio previous ratuit Act ithout a vesti period year ` iio for superauatio In addition to the above mentioned scheme, cotriutio ad other retireet eet the Company also pays additional gratuity as contribution in the Consolidated Statement of a exratia ad the said aout is provided rot ad oss as ofuded iaiit ased o actuaria he cotriutios paae to these pas the vauatio roup are at rates specied i the rues of the he ost recet actuaria vauatio of pa schees assets ad the preset vaue of the deed he roup recoised ` iio previous eet oiatio for ratuit ere carried out year ` iio for providet ad pesio as at arch he preset vaue of the fund contributions in the Consolidated Statement deed eet oiatios ad the reated of rot ad oss current service cost and past service cost, were measured using the Projected Unit Credit (ii) Defined Benefit Plan: ethod a) The Company A he Copa aes aua cotriutios Based on the actuarial valuation obtained in to the Group Gratuity cum Life Assurance this respect, the following table sets out the Schemes administered by the LIC, a funded status of the gratuity plan and the amounts recoised i the Copas acia statements as at the Balace heet date

(` in million) r Particulars Gratuity (Funded) Gratuity (Unfunded) o As at As at As at As at 31.03.2020 31.03.2020 I) Reconciliation in present value of obligations (‘PVO’) defined benefit obligation: Current service cost Past service cost Interest cost Actuarial loss / (gain) ue to deoraphic assuptio ue to ace assuptio ue to experiece assuptio eets paid O at the eii of the ear O at the ed of the ear II) Change in fair value of plan assets: Expected return on plan assets Interest Income Contributions by the employer eets paid Fair value of plan assets at the beginning of the year Fair value of plan assets at the end of the year

174 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) r Particulars Gratuity (Funded) Gratuity (Unfunded) o As at As at As at As at 31.03.2020 31.03.2020 III) Reconciliation of PVO and fair value of plan assets: O at the ed of the ear Fair Value of plan assets at the end of the year Funded status Unrecognised actuarial gain / (loss) Net liability recognised in the Balance Sheet IV) Expense recognised in the Statement of Profit and Loss: Current service cost Past service cost Interest cost ota expese recoised i the tateet of rot ad oss V) Other Comprehensive Income Actuarial loss / (gain) ue to deoraphic assuptio ue to ace assuptio ue to experiece assuptio Return on plan assets excluding net interest ota aout recoised i OC VI) Category of assets as at the end of the year: surer aaed uds NA (Fund is Managed by LIC as per IRDA uideies cateorise copositio of the plan assets is not available)

VII) Actual return on the plan assets: NA VIII) Assumptions used in accounting for the gratuity plan: ortait ates stipuated i dia Assured ives ortait upto

ates stipuated i dia Assured ives ortait fro oards iscout rate aar escaatio rate for rst for rst for rst for rst three years and three years and three years and three years and thereafter thereafter thereafter thereafter Average Remaining Service (years) Epoee Attritio ate up to 5 years above 5 years iX) Estimate of amount of contribution in NA NA immediate next year

*` iio previous ear ` iio capitaised as preoperative expeses out of aove aout

Lupin Limited | Annual Report 2019-20 175 Notes Forming part of the Consolidated Financial Statements

X) Expected future benefit payments (` in million) Particulars As at 31.03.2020 1 year to ears 6 to 10 years More than 10 years

he estiates of saar escaatio cosidered i actuaria vauatio tae accout of iatio seiorit prootio ad other reevat factors such as supp ad dead i the epoet aret Reasonably, possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assuptios costat oud have affected the deed eet oiatio the aouts sho eo (` in million) Gratuity (Funded) Increase Decrease Increase Decrease iscout ate oveet uture saar roth oveet

he providet fud pa of the Copa except at oe pat is operated upi iited Epoees rovidet ud rust rust a separate ea etit Eiie epoees receive eets fro the said rovidet ud oth the epoees ad the Copa ae oth cotriutios to the rovidet ud as eua to a specied percetae of the covered epoees saar he iiu iterest rate paae the rust to the eeciaries ever ear is ei otied the overet of dia he Copa has a oiatio to ae ood the shortfa if a etee the retur fro the ivestets of the rust ad the otied iterest rate he oard of rustees adiister the cotriutios ade the Copa to the schees ad aso dees the ivestet strate to act i the est iterest of the pa participats he Copa has a oiatio to service the shortfa o accout of iterest eerated the fud ad o aturit of fud ivestets ad hece the sae has ee cassied as eed eet a i accordace ith d A Epoee eets As per the uidace ote fro the Actuaria ociet of dia the Company has obtained the actuarial valuation of interest rate obligation in respect of Provident Fund as at arch ad ased o the sae there is o shortfa toards iterest rate oiatio ased o the actuaria vauatio otaied the fooi is the detais of fud ad pa assets

(` in million) r Particulars As at As at o 31.03.2020 I) PVO and fair value of plan assets: Fair Value of plan assets reset aue of deed eet oiatios Net excess/(Shortfall) II) Changes in defined benefit obligation: Liability at the beginning of the year Interest cost Current service cost Employee contribution iaiit rasferred i

176 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) r Particulars As at As at o 31.03.2020 eets paid Actuarial gain/(loss) on experience variance Liability at the end of the year III) Changes in fair value of plan assets: Fair value of plan assets at the beginning of the year Investment income Employer’s contributions Employee’s contribution rasfers i eets paid Return on plan assets, excluding amount recognised in net interest expense Fair value of plan assets at the end of the year IV) Expenses recognized in Statement of Profit and Loss: Current service cost Interest cost Expected return on plan assets coe Expese recoised i the tateet of rot ad oss V) Major categories of Plan Assets (As per percentage of Total Plan Assets): Government of India securities/State Government securities High quality corporate bonds Equity shares of listed companies Debt Mutual Fund Equity Mutual Fund Special Deposit Scheme Bank balance ota VI) Assumptions used in accounting for the provident fund plan: iscout rate Average remaining tenure of investment portfolio (years) uarateed rate of retur Attritio rate upto ears Above 5 years b) Multicare Pharmaceuticals Philippines Inc., Philippines he susidiar at hiippies aes aua cotriutios to a private a to fud deed eet pa for uaifi epoees he etireet a is a ocotriutor ad of the deed eet tpe hich provides a retireet eet eua to of a aar for ever ear of Credited ervice he ost recet actuaria vauatio of pa assets ad the preset vaue of the deed eet oiatio for retireet eet ere carried out as at arch he preset vaue of the deed eet obligations and the related current service cost and past service cost, were measured using the Projected it Credit ethod he fooi tae sets out the status of the retireet pa ad the aouts recoised i the roups acia stateets as at aace sheet date

Lupin Limited | Annual Report 2019-20 177 Notes Forming part of the Consolidated Financial Statements

(` in million) r Particulars Lump sum Retirement o eets fuded As at As at 31.03.2020 I) Reconciliation in present value of obligations (‘PVO’) defined benefit obligation: Current service cost Past service cost Interest cost Actuarial loss/(gain) ue to eoraphic Assuptio ue to iace Assuptio ue to Experiece eets paid orei exchae trasatio differece O at the eii of the ear O at the ed of the ear II) Change in fair value of plan assets: Return on Plan Assets excluding interest income Interest income Contributions by the employer Contributions by the employee eets paid orei exchae trasatio differece Fair value of plan assets at the beginning of the year Fair value of plan assets at the end of the year III) Reconciliation of PVO and fair value of plan assets: O at ed of the ear Fair Value of plan assets at the end of the year Funded status Unrecognised actuarial gain/(loss) Net liability recognised in the Consolidated Balance Sheet IV) Expense recognised in the Consolidated Statement of Profit and Loss: Current service cost Past service cost Net interest Return on Plan Assets excluding interest income ota expese recoised i the Cosoidated tateet of rot ad oss V) Other Comprehensive Income: Actuarial loss/(gain) recognised for the period ue to eoraphic Assuptio ue to iace Assuptio ue to Experiece Return on plan assets excluding net interest ota aout recoised i OC VI) Category of assets as at the end of the year: Cash & Cash Equivalents Equity Instruments et struets overet ods et struets Other ods it vestet rust uds VII) Actual return on the plan assets

178 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) r Particulars Lump sum Retirement o eets fuded As at As at 31.03.2020 VIII) Assumptions used in accounting for the Retirement Benefit plan: ortait Rates stipulated in CO ae iscout rate aar escaatio rate Average Remaining Service (years) Epoee attritio rate

IX) Expected future benefit payments (` in million) Particulars As at 31.03.2019 First year Second year hird ear Fourth year Fifth year eod ve ears

he estiates of saar escaatio cosidered i actuaria vauatio tae accout of iatio seiorit prootio ad other reevat factors such as supp ad dead i the epoet aret

Reasonably, possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assuptios costat oud have affected the deed eet oiatio the aouts sho eo (` in million) Increase Decrease Increase Decrease iscout ate oveet uture saar roth oveet c) Laboratorios Grin S.A. de C.V., Mexico he susidiar at exico has retireet pa to cover its epoees hich are reuired a der the pa epoees are etited to eets ased o eve of saaries eth of service ad certai other factors at the tie of retireet or teriatio he ost recet actuaria vauatio of the preset vaue of the deed eet oiatio for retireet eets ere carried out as at arch he preset vaue of the deed eet oiatios ad the reated curret service cost ad past service cost ere easured usi the roected it Credit ethod

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

he fooi tae sets out the status of the retireet pa ad the aouts recoised i the roups acia stateets as at aace sheet date

(` in million) r Particulars Lump sum Retirement o eets o fuded As at As at 31.03.2020 I) Reconciliation in present value of obligations (‘PVO’) defined benefit obligation: Current service cost Past service cost Interest cost Actuarial loss/(gain) ue to eoraphic Assuptio ue to iace Assuptio ue to Experiece eets paid orei exchae trasatio differece O at the eii of the ear O at the ed of the ear II) Reconciliation of PVO and fair value of plan assets: O at ed of the ear Fair Value of plan assets at the end of the year Funded status Unrecognised actuarial gain/(loss) Net liability recognised in the Consolidated Balance Sheet III) Expense recognised in the Consolidated Statement of Profit and Loss: Current service cost Past service cost Net interest ota expese recoised i the Cosoidated tateet of rot ad oss IV) Other Comprehensive Income: Actuarial gain/(loss) recognised for the period ue to eoraphic Assuptio ue to iace Assuptio ue to Experiece ota aout recoised i OC V) Assumptions used in accounting for the plan: ortait Experience Social insurance by gender iscout rate aar escaatio rate Average Remaining Service (years) Epoee attritio rate

VI) Expected future benefit payments (` in million) Particulars As at 31.03.2020 First year Second year hird ear Fourth year Fifth year eod ve ears

180 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

he estiates of saar escaatio cosidered i actuaria vauatio tae accout of iatio seiorit prootio ad other reevat factors such as supp ad dead i the epoet aret

Reasonably, possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assuptios costat oud have affected the deed eet oiatio the aouts sho eo

(` in million) 2019-2020 Increase Decrease Increase Decrease iscout ate oveet uture saar roth oveet

46. Income taxes: a) Tax expense recognised in statement profit and loss: (` in million) Particulars Year ended Year ended 31.03.2020 Curret ax Expese for the ear ax expese ac of prior ears et Curret ax Expese Deferred income tax liability/(asset), net Oriiatio ad reversa of teporar differeces Tax expense for the year 11571.1 8879.4 b) Tax expense recognised in other comprehensive income: (` in million) Particulars Year ended Year ended 31.03.2020 Items that will not be reclassified to profit or loss eeasureets of the deed eet pas Items that will be reclassified to profit or loss he effective portio of ais ad oss o hedi istruets i a cash o hede Total 277.0 139.3

iicat aaeet udeet is reuired i deterii provisio for icoe tax deferred icoe tax assets ad iaiities ad recoveraiit of deferred icoe tax assets he recoveraiit of deferred icoe tax assets is based on estimates of taxable income and the period over which deferred income tax assets will e recovered A chaes i future taxae icoe oud ipact the recoveraiit of deferred tax assets During the year, the company has recognized deferred tax asset of ` iio previous ear ` iio o uused tax oss ased o the eve of historica taxae icoe ad proectios of future taxae icoe over the periods in which the deferred tax assets are deductible, management believes that the company will realize the eets of those recoied deductie differeces ad tax oss carr forards he curret tax i respect of forei susidiaries has ee coputed cosideri the appicae tax as ad tax rates of the respective coutries as certied the oca tax cosutatsoca aaeet of the said susidiaries As o arch tax iaiit ith respect to the divideds proposed efore the acia stateets approved for issue ut ot recoised as a iaiit i the acia stateets is ` nil (previous year ` iio

Lupin Limited | Annual Report 2019-20 181 Notes Forming part of the Consolidated Financial Statements

c) Reconciliation of Consolidated tax expense and the Consolidated accounting profit multiplied by India's domestic tax rate: (` in million) Particulars Year ended Year ended 31.03.2020 Profit before tax before jointly controlled entity but including exceptional item ax usi the Copas doestic tax rate arch arch Tax effect of: iffereces i tax rates of forei urisdictios Current year losses/deductible expenditure for which no deferred tax asset was recognised Chae i tax ase due to itraroup asset purchase arraeet odeductie expeses Incremental deduction on account of Research and Development costs Exeptio of prot i icetives Other exept icoe orei exchae differeces Others Current and Deferred Tax expense (excluding prior year taxes) as per note 46(a) 11635.4 9110.4

d) Movement in deferred tax balances:

(` in million) Particulars As at Recognised in/under As at 31.03.2020 eferred ax Assetsiaiities Net rot or Retained Discontinued C Net balance balance Loss earnings/ operations OC Property, plant and equipment Intangibles assets/Intangibles assets under development Cash Flow Hedge Reserve Operati ax oss ad iterest loss carry forward Government Grants rovisio for Osoete ivetor Litigation Reserve Provision for Expenses Deferred Income rovisio for Epoee eet pairet Aoaces for rade Receivable/Bad Debts reaised rots o sod inventories Others Net Deferred tax assets/(liabilities) 4457.2 (4701.4) 395.6 (537.4) 133.7 (252.3)

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) Particulars As at Recognised in/under As at eferred ax Assetsiaiities Net rot or oss OC Discontinued C Net balance balance operations Property, plant and equipment Intangibles assets/Intangibles assets under development Cash Flow Hedge Reserve Operati ax oss ad iterest loss carry forward Government Grants rovisio for Osoete ivetor Litigation Reserve Provision for Expenses Deferred Income rovisio for Epoee eet pairet Aoaces for rade Receivable/Bad Debts reaised rots o sod inventories Others Net Deferred tax assets/(liabilities) 4310.3 (289.9) 139.3 - 297.5 4457.2

eected i the aace sheet as foos (` in million) Particulars As at As at 31.03.2020 eferred ax Asset eferred ax iaiit Deferred Tax Asset/(Liabilities)(net) (252.3) 4457.2 e) Operati oss carr forard cosists of usiess osses capita osses uasored depreciatio ad uasored iterest carrforards eferred tax assets have ot ee recoied o operati osses of ` iio previous ear ` iio ecause curret there is o reasoae certait that the roup i e utiii the eets i ear future A portio of this tota oss ca e carried ideite ad the reaii aouts expire at various dates rai fro throuh previous ear fro throuh ad soe of this oss ca e carr ac ti Aso deferred tax assets to the extent of ` nil (previous year ` iio o differece etee tax ad oo vaue of certai intangible assets/intangible assets under development of Gavis has not been recognised as there is no reasoae certait of reaisatio refer ote f) he iistr of Corporate Affairs vide its oticatio dated th arch iserted Appedix C certait over coe ax reatets to d A coe axes appicae fro st Apri he copa opted the trasitio provisio provided i this Appedix C the copa has idetied ucertai tax positios ad has estiated the iaiit ased o the ost ie aout hese estiates are based on its probability assessment of the uncertain tax treatment accordingly the Company recognised tax provision of ` iio as a adustet to the opei aace of retaied earis o Apri

Lupin Limited | Annual Report 2019-20 183 Notes Forming part of the Consolidated Financial Statements

47. he areate aout of reveue expediture had ed for dissoutio o arch incurred by the Group during the year on ad ot dissoved o Apri Research and Development and shown in the Investment of ` iio i upi ussia respective heads of account is ` iio has ee ritteoff duri previous ear (previous year ` iio g) Lupin Ukraine LLC, Ukraine (Lupin Ukraine), 48. a) During the year, Lupin Atlantis Holdings SA, stepdo susidiar of the Copa Switzerland (LAHSA) acquired/subscribed to ot dissoved o eruar the equity stake of the following subsidiaries: Investment of ` iio i upi raie has ee ritteoff duri previous ear i Additioa ivestet i upi c A at a total cost of ` nil (previous year ` h) Gavis Pharmaceuticals, LLC, USA (Gavis), iio as additioa paidi capita ho oed susidiar of upi c A securities preiu C ot dissoved o arch

ii) Additional investment in Lupin Europe i he Copa hods euit shares GmbH at a total cost of ` iio as uuoted of ai ardha oer td dia at a capital contribution (previous year ` i cost of ` iio hich as fu ipaired the Copa duri the previous ear b) During the year, Lupin Atlantis Holdings SA, Switzerland (LAHSA) acquired/subscribed to uri the ear ioix herapeutics the ouaied preferece shares i upi LLC, USA wholly owned subsidiary of Lupin c A at a tota cost of ` iio aaeet c forer o as upi (previous year ` i etures c ot dissoved o eceer c) During the year, LAHSA has sold investment of ` iio i upi c A he aove acuisitiossuscriptiosdisposas to aoi orer o as upi are based on the net asset values, the future Hodis for a oia vaue proected reveues operati prots cash os and independent valuation reports; as applicable, d uri the ear aoi orer o of the ivestee copaies as upi Hodis acuiredsuscried to the equity stake of the following subsidiaries: 49.Goodwill on consolidation: i euit stae i aoi at tota Impairment testing of Goodwill cost of ` iio previous ear ` For the purposes of impairment testing, carrying i fro AHA amount of goodwill has been allocated to the following Cash Generating Units (CGU's) as follows: ii) Equity stake in Medquimica Industria (` in million) araceutica A rai at a tota cost Particulars As at As at of ` iio previous ear ` nil) 31.03.2020 South Africa iii) Additional investment in Generic Health Germany H aasia at a tota cost of ` Philippines Australia million (previous year ` iio Netherlands Brazil iv Additioa ivestet i upi c A at Mexico a total cost of ` iio previous United States of America year ` i apa Total 18514.8 23803.2 e aoi etherads is ered ith ivested duri the ear refer ote upi Hodis etherads ad the Movement in Goodwill is on account of exchange resuti etit is reaed as aoi differece o cosoidatio aouti to ` etherads o Octoer ith effect iio excudi the divested operatios fro Apri he recoverae aouts of the aove Cs have f) Lupin Pharma LLC, Russia (Lupin Russia) ee assessed usi a vaueiuse ode aue i stepdo susidiar of the Copa use is generally calculated as the net present

184 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

and LHL’s projections/plans for introducing vaue of the proected posttax cash os pus new products (including products from the a terminal value of the cash generating unit to Company) in the UK Market in the near future, hich the oodi is aocated itia a posttax roth i the turover ad protaiit is discount rate is applied to calculate the net present expected, which would result in improvement in vaue of the posttax cash os et orth over a period of tie AHA hods euit stae at a cost of he e assuptios used i the estiatio of the ` iio previous ear ` iio recoverable amount are set out below: i upi idde East C E he said he vaues assied to the e assuptios subsidiary has incurred losses during the year represent management's assessment of future and has negative net worth as at the end of trends in the relevant industries and have been the ear he susidiar has ed for voutar based on historical data from both external and iuidatio i arch itera sources c AHA hods euit stae at a cost of he cash o proectios are ased o ve ears ` iio previous ear ` iio i specic estiates ve ears estiates deveoped upi apa Asia acic AAC he using internal forecasts and a terminal growth rate said subsidiary has negative net worth as at thereafter, considering the value in use of cash the ed of the ear Cosideri the acia eerati uits is etter reected proectios technical and operational support from the for ears due to the usiess ife cce ad Company and APAC’s projections/plans the oer ter estatio of products he pai Company is of the view that this would lead horio reects the assuptios for shortto to an improvement in growth, turnover and midterm market developments and have been protaiit hich oud resut i iproveet adjusted for the risks of competition, product life i et orth over a period of tie cce etc d aoi hods euit stae at a cost he teria roth rates used i extrapoati of ` iio previous ear ` nil) in cash os eod the pai horio raed upi c he said susidiar has eative et fro to for the ear eded arch orth as at the ed of the ear Cosideri the ad fro to for the ear eded acia techica ad operatioa support arch from the Company and Lupin Inc’s projections / plans the Company is of the view that this iscout rate reects the curret aret would lead to an improvement in growth, assesset of the riss specic to a C or roup turover ad protaiit hich oud resut of Cs he discout rate is estiated ased o in improvement in net worth, over a period of the weighted average cost of capital for respective tie C or roup of Cs osttax discout rate used raed fro to for the ear eded e) Further, net worth of Hormosan Pharma GmbH, arch ad fro to for the ear Pharma Dynamics (Proprietary) Limited, eded arch Lupin Australia Pty Limited, Generic Health Pty Limited, Lupin Pharma Canada Limited, he Copa eieves that a reasoa upi exico A de C eeric Heath possible change in the key assumptions on H aoratorios ri A de C which a recoverable amount is based would eduica dstria aracutica A not cause the aggregate carrying amount to ove aoratories c upi Europe H is exceed the aggregate recoverable amount of the substantially less than the carrying amount of casheerati uit investments made by the Company directly or 50. a) Lupin Atlantis Holdings SA, Switzerland throuh its susidiaries AHA hods euit stae at a cost of ` iio previous ear ` iio he roup cosiders its ivestets i i upi Heathcare td H he said susidiaries as strateic ad oter subsidiary has incurred losses during the year in nature and accordingly no provision and has negative net worth as at the end of for diminution in value of investments is the ear Cosideri the acia techica and operational support from the Company cosidered ecessar

Lupin Limited | Annual Report 2019-20 185 Notes Forming part of the Consolidated Financial Statements

51. a) N on-controlling Interest represents the non-controlling’s share in equity of the subsidiaries as below: (` in million) Particulars As at As at 31.03.2020 uticare haraceuticas hiippies c hiippies hare i Euit Capita hare i eserves ad urpus hare i Other Coprehesive coe oa haraceutica dustr Co iited apa Cosoidated hare i Euit Capita hare i eserves ad urpus hare i Other Coprehesive coe Total 444.6 468.6

* Divested during the year (refer note 55) b) Interest in Joint Venture: ae of oit eture Country of harehodi Incorporation March 31, 2020 arch YL Biologics Limited apa Carrying amount of investment (` in million)

uarised aace heet as at arch (` in million) Particulars As at As at March 31, 2020 arch Current assets ocurret assets Current liabilities ocurret iaiities Equity 677.8 559.6

uarised tateet of rot ad oss for the ear arch (` in million) Particulars For the year For the year ended ended March 31, 2020 arch Revenue Expenses ax Profit after tax 8 7. 5 83.4

52. Auditors’ Remuneration: (` in million) Particulars 2019-2020 Payment to Auditors of the Company and its subsidiaries: a) As Auditors for other services icudi axatio atters ad certicatios c eiurseet of outofpocet expeses Total 150.7 145.4

186 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

53. orei Currec rasatio eserve efer ote represets the et exchae differece o trasatio of net investment in foreign operations located at Australia, Germany, South Africa, Philippines, Mexico, iterad rai A etherads AE ad Caada fro their oca currec to the dia currec Coseuet i accordace ith the dia Accouti tadard d A he Effects of Chaes i orei Exchae ates the exchae rate differece o trasatio of ` iio previous ear ` iio is deited duri the ear to such reserve 54. Exceptional Items: During the year, the Group recognized following items as exceptional items: a) Settlement with the State of Texas: he exas Attore eeras office served upi haraceuticas c ith severa Civi vestiative eads fro a ad cotiui throuh he tate of exas the tate ed a asuit aaist upi td upi c ad certai executives o ue the Oriia asuit aei vioatios of the exas edicaid raud revetio Act A uri the ear the tate offered a setteet of iio to upi roup of hich iio as aread accrued i earier ears der the setteet areeet the tate ad upi roup had areed o a of the ters of the setteet ad the tate areed to disiss the idividua defedats iediate ia paet of iio ` iio ad iio ade duri the ear b) Impairment of IPs: ooi our aua ipairet revie the ipairet chares recoied i the cosoidated prot ad loss account in relation to certain intangible assets and intangible assets under development is as follows:

Intangible assets – ` iio dia ` iio ad A ` iio Intangible assets under development – ` iio dia ` iio ad A ` iio Both the categories referred to above relate to intangibles acquired as part of the acquisition of Gavis roup avis reated to A arets havi ipaired priari o accout of i siicat prici pressure resulting from customer consolidation into large buying groups capable of extracting greater price reductios ii ipeetatio of coutereasures aaist usae of Opioids i ited tates ad iii deas i the auch of soe of our e eeric products he ipairet has ee deteried cosideri each idividua itaie asset as a cash eerati uit C except for s uder deveopet hich have ee assessed toether as oe C Recoverable amount of CGUs for which impairment is done is ` iio ecoverae aout ie higher of value in use and fair value less cost to sell) of each individual CGU was compared to carrying value and impairment amount was arrived as follows: Cs here carri vaue as hiher tha recoverae aout ere ipaired ad Cs here recoverae aout as hiher tha carri vaue ere carried at carri vaue he fair vaue so used is cateoried as a eve vauatio i ie ith the fair vaue hierarch per reuireets of d A air aue easureet d A he fair vaue has ee deteried ith referece to the discouted cash o techiue he e assuptios used i the estiatio of the recoverae aouts is as etioed eo he vaue assigned to the key assumptions represents management’s assessment of the future trends in the industry ad have ee ased o historica data fro oth extera ad itera sources

Lupin Limited | Annual Report 2019-20 187 Notes Forming part of the Consolidated Financial Statements

Assumption How Determined roected cash os Based on past experience and adjusted for the following: Curret aret daics Aticipated copetitio pact due to CO Long term growth rate Long term growth rate has been determined with reference to market dynamics of each individual product osttax ris adusted discouti roected cash os ere discouted to preset vaue at a discout rate that is rate commensurate with all risks of ownership and associated risks of realizing the proected residua prots Each product cateor Curret areted roducts ad approved AAs ied AAs ad face differet riss ad accordi differet discout rates ere deteried ased o each product cateors ris proe iscout rate as coiatio of cost of det ad cost of euit Cost of euit as estiated usi capita asset prici ode

he proected cashos are discouted at posttax rate rai fro to previous ear to he teria roth rate is cosidered at previous ear he cash o proectios are ased o ve ears specic estiates ve ears estiates deveoped usi itera forecasts ad a teria roth rate thereafter cosideri the ife of itaies ei approx ears he aaeet has cosidered te ear roth rate sice the sae appropriate reects the period over hich the future eets of the itaies i accrue to the Copa ased o the assesset carried out as at arch ad after cosideri perforace for the fu ear eded arch o further provisio have ee ade

c) Divestment of Subsidiaries in Japan: uri the Curret ear the roup sod its stae i its apaese usidiaries resuti i pretax ai of ` iio for additioa detais refer ote i he roup throuh its usidiar oa haraceutica Co td sod its stae i oa Criticare td CC his trasactio resuted i oss of ` iio ii urther the roup throuh its usidiar aoi etherads forer o as upi Hodis etherads sod its stae i oa haraceutica Co td his trasactio resuted ito ai of ` iio d) Fine to European Commission: Last year, the General Court of the European Union delivered its judgement concerning Lupin's appeal against the Europea Coissios EC decisio i case of aeed reach of the E Atitrust ues i respect of s for product eridopri this respect the roup has ade a provisio of E iio ` iio icudi iterest ad ithhodi tax thereo of E iio ` iio hich as discosed as a exceptioa ite he roup has ed appea aaist this udeet i the Court of ustice of the Europea io

55. Discontinued operations: O Auust oa haraceutica dustr Co iited apa the hodi copa for oa Criticare Co iited apa CC etered ito a share purchase areeet ith eo AA co td a ho oed susidiar of eophara roup for divestet of its etire stae i CC O oveer aoi etherads forer o as upi Hodis etherads susidiar of the upi iited etered ito a share purchase areeet ith utus td for divestet of its etire stae i oa haraceutica dustr Co iited apa he said trasactios represeti apa seet ere cocuded o th epteer ad th eceer respective rot or oss of discotiued operatios ad the resutat ai oss o disposa has ee icuded i Cosoidated acia stateets as prot fro discotiued operatios ad

188 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements exceptioa ites prot oss o divestet respective for the ear eded arch he prot or oss for the coparative period have aso ee discosed as prot fro discotiued operatios a) Results of discontinued operations (` in million) Particulars 2019-2020 Revenue Expenses Profit / (loss) before tax from discontinued operations coe ax of discotiued operatios Profit / (loss) after tax from discontinued operations Gain on sale of discontinued operation coe ax o sae of discotiued operatio Profit / (loss) from discontinued operations, net of tax Basic EPS Diluted EPS b) Cash flows from/(used) from discontinued operations (` in million) Particulars 2019-2020 Cash os froused fro operati activities Cash os froused fro ivesti activities Cash os froused fro aci activities Net cash flows/(used) for the year c) Computation of gain on Disposal of Kyowa Pharmaceutical & KCC (` in million) Particulars 2019-2020 Cash cosideratio received et off expeses Less: Carrying value of net asset sold (net of NCI) Less: Goodwill Add Exchae differece arisi o trasatio of orei operatios Gain on disposal d) Effect of disposal on the financial position of the Group (` in million) Particulars 2019-2020 ropert at ad Euipet Capita oriproress Other taie Assets ad taie Assets Under Development oCurret assets Deferred tax assets Current Assets Inventories rade ad other receivaes Cash and cash equivalents Other curret assets oCurret iaiities rade ad other paaes Net Assets 1644.2 Consideration received Less: Cash and cash equivalents disposed of Net Cash Inflows from disposal of subsidiary 14425.3

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

56. As per best estimates of the management, provision has been made as under: (a) Probable return of goods from customers: (` in million) Particulars 2019-2020 Carrying amount at the beginning of the year Add : Additional Provisions made during the year Less : Amounts used / utilised during the year Add Exchae ifferece duri the ear Less : Reduction on account of disposal of subsidiaries Carrying amount at the end of the year 4542.0 3132.4 (b) European Commission fine (` in million) Particulars 2019-2020 Carrying amount at the beginning of the year Add : Additional Provisions (including interest) made during the year Less : Amounts used / utilised during the year Add Exchae ifferece duri the ear Carrying amount at the end of the year 3609.5 3335.9

57. he areate aout of cash expediture icurred duri the ear the Copa o Corporate ocia Responsibility (CSR) is ` iio previous ear ` iio ad is sho separate uder ote ased o uidace ote o Accouti for Expediture o C Activities issued the CA (` in million) Particulars 2019-2020 Donations Epoee eets Expese Others atiet Aareess etc Total 342.0 379.5 he aout reuired to e spet the copa duri the ear is ` iio previous ear ` iio o aout as spet duri the ear toards costructioacuisitio of a asset reati to C expediture ad there are o outstadi aouts paae toards a other purposes

58. he iforatio reardi icro Eterprises ad a Eterprises has ee deteried to the extet such parties have ee idetied o the asis of iforatio avaiae ith the Copa his has ee reied upo the auditors (` in million) Particulars As at As at 31.03.2020 i he pricipa aout ad the iterest due thereo reaii upaid to a suppier at the end of each accounting year (interest ` nil) (interest ` nil) ii he aout of iterest paid the uer i ters of ectio of the icro a ad ediu Eterprises eveopet Act ao ith the aout of the payment made to the supplier beyond the appointed day during each accounting year iii he aout of iterest due ad paae for the period of dea i ai paet ut ithout addi the iterest specied uder the icro a ad ediu Eterprises eveopet Act iv he aout of iterest accrued ad reaii upaid at the ed of each accounting year v he aout of further iterest reaii due ad paae eve i the succeedi years, until such date when the interest dues above are actually paid to the small enterprise, for the purpose of disallowance of a deductible expenditure under ectio of the icro a ad ediu Eterprises eveopet Act

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements 59. Financial Instruments: Financial instruments – Fair values and risk management: A. Accounting classification and fair values: Carri aouts ad fair vaues of acia assets ad acia iaiities icudi their eves i the fair vaue hierarch are preseted eo t does ot icude the fair vaue iforatio for acia assets ad acia iaiities ot easured at fair vaue if the carri aout is a reasoae approxiatio of fair vaue Fair value hierarchy Level 1 uoted prices uadusted i active arets for idetica assets or iaiities Level 2 puts other tha uoted prices icuded ithi eve that are oservae for the asset or iaiit either direct ie as prices or idirect ie derived fro prices Level 3 puts for the assets or iaiities that are ot ased o oservae aret data uoservae iputs (` in million) As at 31.03.2020 Carrying amount Fair value Derivatives Amortised ota Level 1 eve Level 3 ota designated as Cost hedge Financial assets oCovertie eetures oCurret vestets others oCurret oas ecurit eposit Others Other oCurret iacia Assets erivative istruets Others Current Investments rade eceivaes Cash and Cash Equivalents Other a aaces icudi earmarked balances with banks Current Loans ecurit eposit Others Other Curret iacia Assets erivative istruets Others 13277.8 - 94609.7 107887.5 13090.1 132.0 55.7 13277.9

Financial liabilities oCurret orrois rade aaes Other oCurret iacia Liabilities erivative istruets Others Current Borrowings rade aaes Other Curret iacia iaiities erivative istruets Others - 460.6 102529.8 102990.4 - 460.6 - 460.6

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

(` in million) As at Carrying amount Fair value Derivatives Amortised ota Level 1 eve Level 3 ota designated as Cost hedge

Financial assets Non Convertible Debentures oCurret vestets others oCurret oas ecurit eposit Others Other oCurret iacia Assets erivative istruets Others Current Investments rade eceivaes Cash and Cash Equivalents Other a aaces icudi earmarked balances with banks Current Loans Other Curret iacia Assets erivative istruets Others 16828.5 100.5 75034.0 91963.0 16766.7 101.7 60.6 16929.0

Financial liabilities oCurret orrois rade aaes Other oCurret iacia Liabilities Current Borrowings rade aaes Other Curret iacia iaiities erivative istruets Others 25.3 - 122212.4 122237.8 - 25.3 - 25.3

hese are for operatio purposes ad the roup expects its refud o exit he roup estiates that the fair vaue of these ivestets are ot ateria differet as copared to its cost

B. Measurement of fair values: auatio techiues ad siicat uoservae iputs he fooi taes sho the vauatio techiues used i easuri eve ad eve fair vaues for acia istruets easured at fair vaue i the stateet of acia positio as e as the siicat uoservae iputs used

pe Valuation technique iicat terreatioship unobservable etee siicat inputs unobservable inputs and fair value measurement Derivative instruments orard prici he fair vaue is deteried usi Not Not applicable quoted forward exchange rates at the reporting applicable date and present value calculations based on high credit uait ied curves i the respective currec ocurret acia assets iscouted cash os he vauatio ode cosiders Not Not applicable and liabilities the present value of expected receipt/payment applicable discouted usi appropriate discouti rates

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

C. Financial risk management: procedures, the results of which are reported to the he roup has exposure to the fooi riss arisi audit coittee fro acia istruets i. Credit risk: Credit ris iuidit ris ad Credit ris is the ris of acia oss to the roup if aret ris a custoer or couterpart to a acia istruet fails to meet its contractual obligations, and arises he Copas oard of directors has overa principally from the Group’s receivables from responsibility for the establishment and oversight custoers ad ivestet securities Credit ris is of the Copas ris aaeet fraeor managed through credit approvals, establishing he oard of directors has estaished the is credit limits and continuously monitoring the Management Committee, which is responsible for creditworthiness of customers to which the Group developing and monitoring the Company’s risk rats credit ters i the ora course of usiess aaeet poicies he coittee reports to the he roup estaishes a aoace for doutfu oard of directors o its activities debts and impairment that represents its estimate he Copas ris aaeet poicies are of incurred losses in respect of trade and other established to identify and analyse the risks faced receivaes ad ivestets by the Company, to set appropriate risk limits and Trade receivables cotros ad to oitor riss ad adherece to iits he roups exposure to credit ris is iueced Risk management policies and systems are reviewed mainly by the individual characteristics of each periodica to reect chaes i aret coditios custoer he deoraphics of the custoer ad the Copas activities he Copa throuh including the default risk of the industry and country its training, standards and procedures, aims to i hich the custoer operates aso has a iuece maintain a disciplined and constructive control o credit ris assesset Credit ris is aaed environment in which all employees understand their through credit approvals, establishing credit limits roes ad oiatios and continuously monitoring the creditworthiness of he audit coittee oversees ho aaeet customers to which the Group grants credit terms in monitors compliance with the company’s risk the ora course of usiess management policies and procedures, and reviews As at arch the carri aout of the the adequacy of the risk management framework in Group's largest customer (a wholesaler based in North reatio to the riss faced the Copa he audit America) was ` iio previous ear committee is assisted in its oversight role by internal ` iio audit tera audit udertaes oth reuar ad ad hoc reviews of risk management controls and

(` in million) Particulars As at As at 31.03.2020 Not past due but impaired Neither past due not impaired Past due not impaired das das ore tha das Past due impaired das das ore tha das Total 54991.3 51896.5

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

Summary of the Group's exposure to credit risk by age of the outstanding from various customers is as follows:

Expected credit loss assessment he roup aocates each exposure to a credit ris rade ased o a variet of data that is deteried to e predictive of the ris of oss e tieiess of paets avaiae press iforatio etc ad appi experieced credit udeet Exposures to customers outstanding at the end of each reporting period are reviewed by the Group to deterie icurred ad expected credit osses Historica treds of ipairet of trade receivaes do ot reect a siicat credit osses ive that the acroecooic idicators affecti custoers of the roup have not undergone any substantial change, the Group expects the historical trend of minimal credit losses to cotiue he oveet i the aoace for ipairet i respect of trade ad other receivaes duri the ear as as follows: (` in million) Particulars 2019-2020 Balance as at the beginning of the year Impairment loss recognised (net) Aouts ritte off Exchae differeces Reduction on account of disposal of subsidiaries Balance as at the year end

he ipairet oss at arch reated ii. Liquidity risk: to several customers that have defaulted on their Liquidity risk is the risk that the Group will encounter payments to the Group and are not expected to be difficut i eeti the oiatios associated ith able to pay their outstanding balances, mainly due to its acia iaiities that are setted deiveri ecooic circustaces cash or aother acia asset he roups approach to managing liquidity is to ensure, as far as possible, Cash and cash equivalents that it i have sufficiet iuidit to eet its As at the year end, the Group held cash and cash liabilities when they are due, under both normal and equivalents of ` iio previous ear stressed conditions, without incurring unacceptable ` iio he cash ad cash euivaets are osses or risi daae to the roups reputatio hed ith as he roup has otaied fud ad ofud ased Other Bank Balances ori capita ies fro various as he roup Other a aaces are hed ith as ivests its surpus fuds i a xed deposit ad Derivatives liquid and liquid plus schemes of mutual funds, he derivatives are etered ito ith as ocovertie deetures coercia papers hich carr oo ar to aret riss he roup Investment in mutual funds, Non-Convertible monitors funding options available in the debt and debentures and Commercial papers capita arets ith a vie to aitaii acia he roup iits its exposure to credit ris exiiit by generally investing in liquid securities, oCovertie deetures ad Coercia papers Exposure to liquidity risk only with counterparties that have a good credit he fooi are the reaii cotractua rati he roup does ot expect a osses fro aturities of acia iaiities at the reporti date operforace these couterparties he aouts are ross ad udiscouted ad icude estimated interest payments and exclude the impact Other financial assets of etti areeets Other acia assets are either past due or ipaired

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) As at 31.03.2020 Carrying Contractual Cash Flows amount ota oths ears ears More than 5 years oderivative acia iaiities oCurret orrois Interest Payables rade aaes oCurret Other oCurret iacia Liabilities Current Borrowings rade aaes Curret Other Curret iacia Liabilities Total 102990.4 103899.6 77844.9 20317.2 3902.5 1835.0

(` in million) As at Carrying Contractual Cash Flows amount ota oths ears ears More than 5 years oderivative acia iaiities oCurret orrois Interest Payables rade aaes oCurret Other oCurret iacia Liabilities Current Borrowings rade aaes Curret Other Curret iacia Liabilities Total 122237.7 133765.4 53842.3 24302.8 52423.6 3196.7 iii. Market Risk: Market risk is the risk that changes in market prices – such as foreign exchange rates, interest rates and euit prices i affect the roups icoe or the vaue of its hodis of acia istruets aret ris is attriutae to a aret ris sesitive acia istruets icudi forei currec receivaes ad paaes ad o ter det e are exposed to aret ris priari reated to forei exchae rate ris hus our exposure to aret ris is a fuctio of reveue eerati ad operati activities i forei currec he oective of aret ris aaeet is to avoid excessive exposure i our forei currec reveues ad costs he roup uses derivatives to aae aret ris eera the roup sees to app hede accouti to aae voatiit i prot or oss

Currency risk he roup is exposed to currec ris o accout of its operatios i other coutries he fuctioa currec of the roup is dia upee he exchae rate etee the dia rupee ad forei currecies has chaed sustatia i recet periods ad a cotiue to uctuate i the future Coseuet the roup uses oth derivative istruets ie forei exchae forard cotracts to itiate the ris of chaes i forei currency exchange rates in respect of its highly probable forecasted transactions and recognized assets and iaiities he roup eters ito forei currec forard cotracts hich are ot iteded for tradi or specuative purposes but for hedge purposes to establish the amount of reporting currency required or available at the setteet date of certai paaesreceivaes he roup aso eters ito derivative cotracts i order to hede ad aae its forei currec exposures toards future export earis uch derivatives cotracts are etered ito the roup for hedi purposes o ad are accordi cassied as cash o hede

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

ooi is the derivative acia istruets to hede the forei exchae rate ris

(Amount in million) Category Instrument Currency Cross As at As at Buy/Sell Currency 31.03.2020 Hedges of highly Forward USD INR Sell probable forecasted contract transactions Hedges of existing Forward USD BRL Buy payable contract Hedges of existing Forward EUR BRL Buy payable contract Hedges of existing Forward EUR ZAR EO Buy payable contract

he roup has ot etered ito forei currec forard cotract for purposes other tha hedi

Exposure to Currency risk ooi is the currec proe of oderivative acia assets ad acia iaiities

(` in million) Particulars As at 31.03.2020 USD EURO GBP JPY Others Financial assets rade eceivaes ocurret oa ocurret iacia Assets ocurret other Assets Current Loans Current Financial Assets Other curret assets Cash and cash equivalents Other curret acia assets Financial liabilities rade aaes oCurret iacia iaiities Other ocurret iaiities Current Financial Liabilities Current Liabilities Curret ax iaiities Cash and cash equivalents o er orrois Other acia iaiities Current Borrowings et stateet of acia positio exposure 23148.0 (2638.7) 350.0 715.6 944.6

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) Particulars As at USD EO GBP Others Financial assets rade eceivaes ocurret oa ocurret iacia Assets ocurret other Assets Current Loans Current Financial Assets Other curret assets Cash and cash equivalents Other curret acia assets Financial liabilities rade aaes oCurret iacia iaiities Other ocurret iaiities Current Financial Liabilities Current Liabilities Curret ax iaiities Cash and cash equivalents o er orrois Other acia iaiities Current Borrowings et stateet of acia positio exposure 25770.4 1368.0 109.5 297.0 1553.7

Sensitivity analysis A reasoa possie strethei eaei of the dia upee aaist forei currec at arch oud have affected the easureet of acia istruets deoiated i forei currec ad affected euit ad prot or oss the aouts sho eo his aasis assues that a other variaes i particuar iterest rates reai costat ad iores a ipact of forecast saes ad purchases

(` in million) March 31, 2020 rot or oss Equity, net of tax* oveet Strengthening Weakening Strengthening Weakening USD EUR GBP Others (225.2) 225.2 (230.0) 230.0

(` in million) arch rot or oss Equity, net of tax* oveet Strengthening Weakening Strengthening Weakening USD EUR GBP Others (291.0) 291.0 (260.1) 260.1

* including other comprehensive income

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

Interest rate risk terest rate ris ca e either fair vaue iterest rate ris or cash o iterest rate ris air vaue iterest rate ris is the ris of chaes i fair vaues of xed iterest eari acia assets or orrois ecause of uctuatios i the iterest rates if such assetsorrois are easured at fair vaue throuh prot or oss Cash o iterest rate ris is the ris that the future cash os of oati iterest eari orrois i uctuate ecause of uctuatios i the iterest rates

Exposure to interest rate risk he roups iterest rate ris arises fro orrois ad oiatios uder ace eases he iterest rate proe of the roups iteresteari orrois is as foos

(` in million) Particulars As at As at 31.03.2020 oCurret orrois Fixed rate borrowings Variable rate borrowings Current Borrowings Fixed rate borrowings Variable rate borrowings Total 63053.2 84961.5

Fair value sensitivity analysis for fixed-rate instruments he roup does ot accout for a xedrate orrois at fair vaue throuh prot or oss herefore a chae i iterest rates at the reporti date oud ot affect prot or oss

Cash flow sensitivity analysis for variable-rate instruments A reasoa possie chae of asis poits i iterest rates at the reporti date oud have icreased decreased prot or oss the aouts sho eo his aasis assues that a other variaes i particuar forei currec exchae rates reai costat

(` in million) Particulars rot or oss 100 bp increase 100 bp decrease Cash o sesitivit et March 31, 2020 ariaerate orrois arch ariaerate orrois

he ris estiates provided assue a chae of asis poits iterest rate for the iterest rate echar as appicae to the orrois suarised aove his cacuatio aso assues that the chae occurs at the aace sheet date ad has ee cacuated ased o ris exposures outstadi as at that date he period ed aaces are ot ecessari represetative of the averae det outstadi duri the period

Commodity rate risk he roups operati activities ivove purchase ad sae of Active haraceutica rediets A hose prices are exposed to the ris of uctuatio over short periods of tie Coodit price ris exposure is evauated ad aaed throuh procureet ad other reated operati poicies As of arch ad arch the roup had ot etered ito a ateria derivative cotracts to hede exposure to uctuatios i coodit prices

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

60. Capital Management: he roups poic is to aitai a stro capita ase so as to aitai ivestor creditor ad aret codece ad to sustai future deveopet of the usiess aaeet oitors the retur o capita as e as the eve of divideds to ordiar sharehoders

he oard of directors sees to aitai a aace etee the hiher returs that iht e possie ith hiher eves of orrois ad the advataes ad securit afforded a soud capita positio

he roup oitors capita usi a ratio of adusted et det to tota euit or this purpose adusted et det is deed as tota iaiities coprisi iteresteari oas ad orrois ess cash ad cash euivaets other a aaces ad curret ivestets

he roups poic is to eep the ratio eo he Copas adusted et det to tota euit ratio at arch as as foos (` in million) Particulars As at As at 31.03.2020 ota orrois Less : Cash and cash equivalent ess Other a aaces Less : Current Investments Adjusted net debt ota euit Adjusted net debt to total equity ratio * includes earmarked bank deposits against guarantees & other commitments of ` iio previous ear ` iio cassied as Other oCurret iacia Assets

61. Hedge accounting: he Copas ris aaeet poic is to hede aove of its estiated et forei currec exposure i respect of hih proae forecast saes over the fooi oths at a poit i tie he Copa uses forard exchae cotracts to hede its currec ris uch cotracts are eera desiated as cash o hedes he forard exchae forard cotracts are deoiated i the sae currec as the hih proae forecast saes therefore the hede ratio is hese cotracts have a aturit of oths fro the reporti date he Copas poic is for the critica ters of the forard exchae cotracts to ai ith the heded ite he Copa deteries the existece of a ecooic reatioship etee the hedi istruet ad heded ite ased o the currec aout ad tii of their respective cash os he Copa assesses hether the derivative desiated i each hedi reatioship is expected to e ad has ee effective i offsetti chaes i the cash os of the heded ite usi the hpothetica derivative ethod In these hedge relationships, changes in timing of the hedged transactions is the main source of hedge ieffectiveess

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

a. Disclosure of effects of hedge accounting on financial position (` in million) As at 31.03.2020 pe of hede Nominal Carrying amount Line item Maturity Hedge Weighted Changes in Change in and risks Value of hedging in the date ratio Average fair value the value (in USD instrument statement strike of the of hedged mn) of acia price/rate hedging item used as position instrument the basis for where the recognizing hedging hedge instrument is effectiveess included Assets Liabilities Cash o Other curret hedge acias Forward liabilities / u exchange o o 1:1 arch forward current contracts acia liabilities

(` in million) As at pe of hede Nominal Carrying amount Line item Maturity Hedge Weighted Changes in Change in and risks Value of hedging in the date ratio Average fair value the value (in USD instrument statement strike of the of hedged mn) of acia price/rate hedging item used as position instrument the basis for where the recognizing hedging hedge instrument is effectiveess included Assets Liabilities Cash o hedge Apri Forward 1:1 exchange Other curret arch forward acia contracts assets Fair Value Hedge Forward Other curret Apri 1:1 exchange EO acia forward assets contracts Forward Other curret Apri 1:1 exchange acia arch forward assets contracts

b. Disclosure of effects of hedge accounting on financial performance (` in million) As at 31.03.2020 Change in the Hedge Line item in the Aout recassied ie ite affected i value of the ieffectiveess stateet of prot or fro cash o stateet of prot or hedging instrument recognised in loss that includes the hedging reserve to loss because of the recoised i OC prot or oss hede ieffectiveess prot or oss recassicatio Cash o Other Expeses Revenue from hedge Net loss on Foreign operatios ae of Currec rasactios goods

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) As at Change in the Hedge Line item in the Aout recassied ie ite affected i value of the ieffectiveess stateet of prot or fro cash o stateet of prot or hedging instrument recognised in loss that includes the hedging reserve to loss because of the recoised i OC prot or oss hede ieffectiveess prot or oss recassicatio Cash o Other Expeses Revenue from hedge Net loss on Foreign operatios ae of Currec rasactios goods c. he fooi tae provides a recociiatio ris cateor of copoets of euit ad aasis of OC ites et of tax resuti fro cash o hede accouti (` in million) oveets i cash o hedi reserve Balance at 1 April 2018 339.4 Add Chaes i the fair vaue of effective portio of outstadi cash o derivative et of setteet ess Aouts recassied to prot or oss Less: Deferred tax As at March 31, 2019 105.4 Add Chaes i the fair vaue of effective portio of outstadi cash o derivative et of setteet ess Aouts recassied to prot or oss Less: Deferred tax As at March 31, 2020 (242.9)

62. Off-setting or similar agreements: he recoised acia istruets that are offset i aace sheet

(` in million) As at 31.03.2020 Effects of offsetti o the aace sheet Amounts subject to master netting Gross Gross amounts Net amounts Related Net amount Amounts set off i the presented in the amounts balance sheet balance sheet ot offset Financial assets Derivative instruments rade ad other receivaes Financial liabilities Derivative instruments rade ad other paaes

(` in million) As at Effects of offsetti o the aace sheet Amounts subject to master netting Gross Gross amounts Net amounts Related Net amount Amounts set off i the presented in the amounts balance sheet balance sheet ot offset Financial assets Derivative instruments rade ad other receivaes Financial liabilities Derivative instruments rade ad other paaes

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

Offsetting arrangements (i) Trade receivables and payables he Copa has certai custoers hich are aso suppi aterias he roup aso ives reates ad discout to custoers der the ters of areeet there are o aouts paae the Copa that are reuired to e offset aaist receivaes

(ii) Derivatives he Copa eters ito derivative cotracts for hedi future saes eera uder such areeets the amounts owed by each counterparty on a single day in respect of all the transactions outstanding in the same currec are areated ito a sie et aout that is paae oe part to the other

uri the previous ear the Copa has etered ito forei currec forard cotracts u for purposes other tha hedi

63.Additional information as required by Part III of the General Instructions for Preparation of Consolidated Financial Statements to Schedule III to the Companies Act, 2013. Particulars et assets ie tota Share of hare of Other hare of ota assets minus total prot Comprehensive income Comprehensive liabilities income As of ` in As of ` in As of ` in As of tota ` in consolidated million consolidated million consolidated million comprehensive million net assets prot other income comprehensive income Parent Lupin Ltd Indian Subsidiaries Lupin Healthcare Limited, India Foreign Subsidiaries upi haraceuticas c A oa haraceutica dustr Co iited apa oa CritiCare Co iited apa Hormosan Pharma GmbH, Germany Pharma Dynamics (Proprietary) Limited, South Africa Lupin Australia Pty Limited, Australia aoi orer o as upi Hodis etherads Lupin Atlantis Holdings SA, Switzerland Multicare Pharmaceuticals Philippines c hiippies Lupin Healthcare (UK) Limited, UK Lupin Pharma Canada Limited, Canada Generic Health Pty Limited, Australia upi exico A de C exico upi hiippies c hiippies eeric Heath H aasia upi idde East C AE Lupin GmbH, Switzerland upi c A aoratorios ri A de C exico Lupin Pharma LLC, Russia (upto April Medquimica Industria Farmaceutica A rai upi esearch c A Lupin Europe GmbH, Germany ove aoratories c A upi ata c A upi apa Asia acic apa ioix herapeutics C A up to eceer Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

Particulars et assets ie tota Share of hare of Other hare of ota assets minus total prot Comprehensive income Comprehensive liabilities income As of ` in As of ` in As of ` in As of tota ` in consolidated million consolidated million consolidated million comprehensive million net assets prot other income comprehensive income upi etures cA ae chaed to upi aaeet c ef arch

Non-Controlling Interests in the Subsidiaries Multicare Pharmaceuticals Philippines c hiippies oa haraceutica dustr Co iited apa cosoidated Foreign Jointly Controlled Entity (to the extent of shareholding) iooics td apa Total Eliminations/Consolidation Adjustments Total 100.0 125811.6 100.0 (2693.9) 100.0 (6105.3) 100.0 (8799.2)

he aove aoutspercetae of et assets ad et prot or oss i respect of upi iited ad its subsidiaries and a jointly controlled entity are determined based on the amounts of the respective entities icuded i cosoidated acia stateets efore itercopa eiiatioscosoidatio adustets

64.Related Party Disclosures, as required by Indian Accounting Standard 24 (Ind AS 24) are given below: A. Relationships – Category I: Entity having significant influence over the Company: upi vestets vt iited

Category II: Jointly Controlled Entity: iooics td apa

Category III: Key Management Personnel (KMP) r aa hara upto epteer ice Chaira Executive irector s iita upta Chief Executive Officer r iesh eshadhu upta aai irector r aesh aiatha Executive irector oa CO upto eceer ef arch Head Corporate Affairs r ui aharia teri Chief iacia Officer fro ue to arch r ata Copa ecretar

Non- Executive Directors rs au upta Chairperso r aa hara ef epteer ice Chaira r a ear upto arch r A hah r ichard ah r ada r ieep C Chosi r eauc eiard s Christie A udur ef Apri

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

Category IV: Others (Relatives of KMP and Entities in which the KMP and Relatives of KMP have control or significant influence) s avita upta auhter of Chairperso r Aua upta auhter of Chairperso r icha upta auhter of Chairperso s hefai ath upta ife of aai irector iss eda iesh upta auhter of aai irector Master Neel Deshbandhu Gupta (Son of Managing Director) upta H upta ai rust Lupin Human Welfare and Research Foundation Lupin Foundation atashree oati evi aa eva idhi Polynova Industries Limited a roperties vt iited Shuban Prints hara ea ease ervices iited

B. Transactions with the related parties: (` in million) r rasactios For the year ended For the year ended o 31.03.2020 Rent Expenses Others Expenses Recovered/Rent Received Others Remuneration Paid Key Management Personnel Purchases of Goods/Materials oit Cotroed Etit Others Sale of Goods oit Cotroed Etit License Fees Received oit Cotroed Etit Commission, Advisory Fees & Sitting Fees to Non Executive Directors Key Management Personnel Donations Paid Others Dividend Paid Etit havi siicat iuece over the Copa Key Management Personnel Others Services Received (Expense) oit Cotroed Etit Others Expenses Reimbursed oit Cotroed Etit Others Sale of Equipment Others

eated part trasactios aove of reveue fro operatios are discosed separate

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

(` in million) Compensation paid to Key Management Personnel For the year ended For the year ended 31.03.2020 hortter epoee eets ostepoet eets Share based payments Total 229.7 264.4 ers ad coditios of trasactios ith reated parties he saes to ad purchases fro reated parties are ade o ters euivaet to those that prevai i ars eth trasactios Outstadi aaces at the eared are usecured ad iterest free ad setteet occurs i cash

C. Balances due from/to the related parties: (` in million) r Balances As at As at o 31.03.2020 Deposits paid under Leave and License arrangement for premises Others rade eceivaes oit Cotroed Etit rade aaes oit Cotroed Etit Others Deposits received under Leave and License arrangement for premises Others rasactios ad aaces ith oit Cotroed Etit have ee reported at fu vaue

65. arch the iistr of Corporate Affairs issued the Copaies dia Accouti tadards Aedets ues otifi aedets to d A tateet of Cash os hese aedets are i accordace ith the aedets ade teratioa Accouti tadards oard A to A tateet of Cash os he eo discosure is i ie ith such aedets suested (` in million) Particulars Apri Cash Flows oCash Chaes March 31, Interest Foreign Fair Value 2020 Expense Exchange Changes Movement Non-Current Borrowings Secured er oas fro as o er aturities of iace ease Oiatios Unsecured er oas fro as eferred aes ax oa from Government of Maharashtra Curret aturities of o Current Borrowings Current Borrowings Secured Loans from banks Unsecured Loans from banks Interest accrued but not due on Borrowings Total Liabilities from financing 85234.8 (15920.4) 3629.8 2473.5 - 63211.1 activities

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Consolidated Financial Statements

(` in million) Particulars Apri Cash Flows oCash Chaes March 31, Interest Foreign Fair Value Expense Exchange Changes Movement Non-Current Borrowings Secured er oas fro as o er aturities of iace ease Oiatios Unsecured er oas fro as eferred aes ax oa from Government of Maharashtra er oas fro Couci for cietic ad dustria Research (CSIR) Curret aturities of o Current Borrowings Current Borrowings Secured Loans from banks Unsecured Loans from banks Interest accrued but not due on Borrowings Total Liabilities from financing 71463.5 10117.4 3078.3 611.9 - 85271.1 activities

66.he Copa evauates evets or trasactios that occur after the cosoidated aace sheet date ut prior to the issuace of cosoidated acia stateets ad cocuded that o suseuet evets have occurred throuh a that reuire adustet to or discosure i the cosoidated acia stateets

6 7. arch the ord Heath Oraisatio decared CO to e a padeic upp Chai disruptios as a resut of the outrea started ith restrictios o oveet of oods cosure of orders etc i severa coutries fooed a oa ocdo i arch aouced the various overets to cotai the spread of CO ice the roup aufactures ad suppies pharaceutica products hich is categorized under essential goods, the manufacturing and supplies of the products has been functioning with iia disruptios he situatio is ie to further iprove ith easi of restrictios i the coi das In light of these circumstances, the Group has adopted measures to curb the spread of infection in order to protect the health of its employees and ensure business continuity with minimal disruption including remote ori aitaii socia distaci saitiatio of or spaces etc he roup has cosidered itera ad extera iforatio hie aii various estiates i reatio to its acia stateet up to the date of approva of the acia stateets the oard of irectors ad has ot idetied a ateria ipact o the carri vaue of taie ad itaie assets acias assets ivetor receivaes etc as e as orrois ad iaiities accrued As mentioned above, since the Group is into manufacturing and supply of pharmaceutical products (essential oods there is o siicat ipact o the overa dead of the oods ad its supp chai he roup has aso ot oserved a siicat dea i the coectio fro custoers thus there is o siicat icrease i Credit ris urther the roups iuidit positio is adeuate to service a its ear ter det ad other aci arraeetsiaiities he actua ipact of the oa heath padeic a e differet fro that hich has ee estiated as the CO situatio evoves oa he roup i cotiue to cose oitor a ateria chaes to future ecooic coditios

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Consolidated Financial Statements

68.revious ears ures have ee reroupedrecassied herever ecessar to correspod ith the curret ears cassicatiodiscosure

Signature to Note 1 to 68

In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o

Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta Partner Chairperson Vice Chairman Chief Executive Officer eership o DIN: 00058631

Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam Managing Director Executive irector oa CO Company Secretary Place: Mumbai Head Corporate Affairs AC ate a DIN: 01833346

Lupin Limited | Annual Report 2019-20 This page is intentionally left blank

208 Standalone Financial Statements

Lupin Limited | Annual Report 2019-20 209 Independent Auditor’s Report To the Members of LUPIN Limited

Report on the Audit of the Standalone Basis for Opinion Financial Statements We conducted our audit in accordance with the tadards o Auditi As specied uder sectio Opinion of the Act Our resposiiities uder e have audited the stadaoe acia stateets those SAs are further described in the Auditor’s of Lupin Limited (“the Company”), which comprise the Responsibilities for the Audit of the Standalone stadaoe aace sheet as at arch ad Financial Statements section of our report. We are the stadaoe stateet of prot ad oss icudi independent of the Company in accordance with the other comprehensive income), standalone statement Code of Ethics issued by the Institute of Chartered of chaes i euit ad stadaoe stateet of Accoutats of dia toether ith the ethica cash os for the ear the eded ad otes to the reuireets that are reevat to our audit of the stadaoe acia stateets icudi a suar stadaoe acia stateets uder the provisios of the siicat accouti poicies ad other of the Act and the Rules thereunder, and we have explanatory information. fued our other ethica resposiiities i accordace ith these reuireets ad the Code of Ethics In our opinion and to the best of our information We believe that the audit evidence we have obtained ad accordi to the expaatios ive to us the is sufficiet ad appropriate to provide a asis for our aforesaid stadaoe acia stateets ive the opiio o the tadaoe acia stateets iforatio reuired the Copaies Act Act i the aer so reuired ad ive a true ad Key Audit Matters fair vie i coforit ith the accouti pricipes Key audit matters are those matters that, in our eera accepted i dia of the state of affairs of professioa udet ere of ost siicace i the Copa as at arch ad prot ad our audit of the stadaoe acia stateets of other coprehesive icoe chaes i euit ad the current period. These matters were addressed in its cash os for the ear eded o that date the cotext of our audit of the stadaoe acia stateets as a hoe ad i fori our opiio thereon, and we do not provide a separate opinion on these matters. The key audit matter description How the matter was addressed in audit 1. Revenue Recognition: efer ote of accouti poic ad ote i To otai sufficiet ad appropriate audit evidece our stadaoe acia stateets pricipa audit procedures icuded aost others the Revenue from the sale of pharmaceutical products fooi is recoied he cotro over oods is trasferred Copari the accouti poicies i respect of reveue recoitio ad accrua for deductios fro to a customer. The actual point in time when revenue ross saes ith appicae accouti stadards to is recoised varies depedi o the specic ters ensure compliance; and conditions of the sales contracts entered into esti desi ipeetatio ad operati ith custoers he Copa has a are uer of effectiveess of the Copas itera cotros custoers operati i various eoraphies ad saes icudi eera cotros ad e appicatio cotracts ith custoers have distict ters reati cotros over recoitio of reveue ad easureet to the recoitio of reveue the riht of retur ad of sales returns; price adjustments. Assessi adeuac of accrua for returs erfori e idetied the recoitio of reveue fro sae of retrospective testi to idetif a ias ith respect products as a e audit atter cosideri to these estimates; eveue is a e perforace idicator for the erfori sustative testi of seected sapes Copa Accordi there coud e pressure to eet of reveue trasactios recorded duri the eared the expectations of investors / other stakeholders and or a sape of eared saes e veried cotractua ters of saes ivoices cotracts shippi or to eet reveue tarets stipuated i perforace docuets ad acoeded deiver receipts for icetive schees for a reporti period e have those transactions. considered that there is a risk of fraud related to esti cotros over recoitio of reveues ith reveue ei overstated recoitio i the ro respect to research deveopet coerciaiatio period or before control has passed. icesi ad other such arraeets esti the eveue is recoised et of accrua for saes returs recoitio of reveue uder the said arraeet Estiatio is reuired for estaishi a accrua ased ith focus o the ters of such arraeets i on various factors. These factors include past trend, respect to perforace oiatios esti the market conditions and introduction of new products. accuracy of the proportion of revenue in respect of ooi perforace oiatios that is deferred

210 Corporate Overview Statutory Reports Financial Statements

The key audit matter description How the matter was addressed in audit The Company routinely enters into research, development Assessi appropriateess of ostadard aua ad coerciaiatio arraeets i respect of oura etries that affect reported reveue of the e products i the pharaceutica sector icudi Company; collaboration with other pharmaceutical companies. This icudes iicesi outicesi ad other such tpe of arraeets he ature of these arraeets are iheret copex reuiri udet to e appied i respect of reveue recoitio Cosideri the copexit of such trasactios ad extet of udet ivoved recoitio of reveue fro such cotracts has aso ee considered as key audit matter. 2. Investment in Subsidiaries: he carri vaue of ivestet i susidiaries as at o otai sufficiet ad appropriate audit evidece our March 2020 is ` iio pricipa audit procedures icuded aost others the These investments are evaluated at the end of each fooi reporti period to deterie a idicators of esti the desi ad operati effectiveess of impairment. If such evidence exists, impairment loss itera cotros over ipairet assesset icudi is deteried ad recoised i accordace ith ote approva of forecasts ad vauatio ethodoo h of accouti poicies to the stadaoe acia Assessi the auatio ethodoo used ad testi statements. the mathematical accuracy of the impairment models; e idetied the assesset of ipairet idicators Evauati the assuptios used icudi discout and resultant provision, if any, in respect of investment rates ad teria roth rates i susidiaries as a e audit atter cosideri Chaei usiess assuptios used such as saes he siicace of the vaue of these ivestets i roth costs success of e products ad ipact of the Standalone Balance Sheet. the potential economic slowdown caused by Covid-19 erforace ad et orth of these etities ad on these assumptions; he deree of udeet ivoved i deterii the erfori sesitivit aasis of e assuptios recoverae aout of these ivestets icudi his icudes reveue roth rates costs ad the - Valuation assumptions, such as discount rates. discount rates applied in the valuation models. usiess assuptios such as saes roth Evauati past perforaces here reevat ad reated costs ad the resutat cash os assessi historica accurac of the forecasts ade proected to e eerated fro these ivestets Cosideri the ipact of adusti evets that certait i usiesses across eoraphies occurred after the balance sheet date but before the arisi fro the ipact of the Covid padeic reporti date o the cocusios reached 3. Intangible Assets: he carri vaue of taie Assets icudi o otai sufficiet ad appropriate audit evidece our rocess esearch ad eveopet areate pricipa audit procedures icuded aost others the to ` iio as at arch hese assets fooi are evaluated for any indicators of impairment annually. esti the desi ipeetatio ad operati efer ote o f of accouti poicies i respect of effectiveess of e cotros over ipairet impairment. assesset icudi approva of forecasts ad pairet triers ith respect to itaie assets valuation models used; ad are assessed aua at each cash Assessi the vauatio ethodoo used ad testi eerati uit C eve he recoverae aout the mathematical accuracy of the impairment models; of the Cs ei the hiher of the vaue i use ad Assessi ideticatio of Cs ith referece to the fair value less costs of disposal, is compared with the uidace i the appicae accouti stadards carri vaue to idetif a ipairet aue i use is usually derived from discounted future cash Evauati the vauatio assuptios such as discout os he discouted cash o ode uses severa rates roth i saes proaiit of success of e assumptions. These include estimates of future sales products operati ad sei costs used Evauati voues prices operatioa ad sei costs teria the potential impact of economic slowdown caused by vaue roth rates potetia product osoescece Covid-19 pandemic on these assumptions; e product auches ad the eihted averae cost erfori sesitivit aasis of e assuptios of capital. The likely impact of the Covid-19 pandemic his icudes reveue roth rates reated costs ad on these cash also increases the uncertainty involved in the discount rate applied in the valuation models. these estimates. Evauati past perforaces here reevat ad Cosideri the iheret ucertait copexit ad historical accuracy of the forecasts made ; udet ivoved ad the siicace of the vaue of Cosideri the ipact of a adusti evets after the assets ipairet assesset of itaie assets the aace sheet date ut efore the reporti o the has been considered as a key audit matter. carri vaues of the assets

Lupin Limited | Annual Report 2019-20 211 The key audit matter description How the matter was addressed in audit 4. Uncertain tax positions (UTPs) and deferred taxes: he Copa is suect to copexities arisi fro o otai sufficiet ad appropriate audit evidece our various tax positions on deductibility of expenses as pricipa audit procedures icuded aost others the well as allowability of tax incentives / exemptions. fooi hese are suect to periodic chaees oca tax esti the desi ad operati effectiveess of the authorities eadi to protracted itiatios here are cotros over ascertaii copeteess of s a uer of ope tax atters uder itiatio ith tax provisios for curret tax ad recoitio of deferred authorities over a number of years. taxes; he rae of possie outcoes for provisios ad Chaei the adeuac of reated provisios cotiecies ca e ide udeet is reuired to i couctio ith tax speciaists cosideri estiate the tax exposures ad cotiecies chaes to usiess ad tax eisatio ai rovisio for curret tax vauatio of s ad reevat euires ad readi of correspodece ith recoitio of deferred assets iaiities have ee authorities where relevant; idetied as a e audit atter due to the iheret erifi the cacuatio for curret tax provisio copexit i the uderi tax as ad the extet Aai the ratioae for a reease icrease or of udeet ivoved i deveopi these estiates cotiued provisio duri the ear These matters are disclosed in note 46 to the stadaoe acia stateets Chaei udeets reardi the recoveraiit of teporar differeces pertaii to deferred tax efer ote i i siicat accouti poicies aaces his icudes exaii the forecasts ad the expected utiiatio of e teporar differeces Chaei udets ith respect to proaiit of outo arisi fro outstadi itiatios after cosideri the status of recet tax assessets audits ad euiries recet udicia proouceets ad udeets i siiar atters Aso cosider developments in the tax environment and outcome of past itiatios

Other Information he Copas aaeet ad oard of irectors are resposie for the other iforatio he other information comprises the information included in the Company’s annual report, but does not include the acia stateets ad our auditors report thereo Our opiio o the stadaoe acia stateets does ot cover the other iforatio ad e do ot express any form of assurance conclusion thereon. coectio ith our audit of the stadaoe acia stateets our resposiiit is to read the other iforatio ad i doi so cosider hether the other iforatio is ateria icosistet ith the stadaoe acia stateets or our oede otaied i the audit or otherise appears to e ateria misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other iforatio e are reuired to report that fact e have othi to report i this reard Management’s and Board of Director’s Responsibility for the Standalone Financial Statements he Copas aaeet ad oard of irectors are resposie for the atters stated i sectio of the Act ith respect to the preparatio of these stadaoe acia stateets that ive a true ad fair vie of the state of affairs prot ad other coprehesive icoe chaes i euit ad cash os of the Copa i accordace ith the accouti pricipes eera accepted i dia icudi the dia Accouti tadards d A specied uder sectio of the Act his resposiiit aso icudes aiteace of adeuate accouti records i accordace ith the provisios of the Act for safeuardi of the assets of the Copa ad for preveti ad detecti frauds ad other irreuarities seectio ad appicatio of appropriate accouti poicies ai udeets ad estiates that are reasoae ad prudet ad desi ipeetatio ad aiteace of adeuate itera acia cotros that ere operati effective for esuri accurac ad copeteess of the accouti records reevat to the preparatio ad presetatio of the stadaoe acia stateets that ive a true ad fair vie ad are free fro ateria misstatement, whether due to fraud or error. prepari the stadaoe acia stateets the aaeet ad oard of irectors are resposie for assessi the Copas aiit to cotiue as a oi cocer discosi as appicae atters reated to oi cocer ad usi the oi cocer asis of accouti uess the oard of irectors either iteds to iuidate the Copa or to cease operatios or has o reaistic aterative ut to do so he oard of irectors is aso resposie for overseei the Copas acia reporti process

212 Corporate Overview Statutory Reports Financial Statements

Auditor’s Responsibilities for the Audit of auditor’s report to the related disclosures in the Standalone Financial Statements the stadaoe acia stateets or if such Our oectives are to otai reasoae assurace discosures are iadeuate to odif our opiio aout hether the stadaoe acia stateets as Our cocusios are ased o the audit evidece a whole are free from material misstatement, whether obtained up to the date of our auditor’s report. due to fraud or error, and to issue an auditor’s report However, future events or conditions may cause that includes our opinion. Reasonable assurance the Copa to cease to cotiue as a oi is a hih eve of assurace ut is ot a uaratee concern. that an audit conducted in accordance with SAs will Evauate the overa presetatio structure ad always detect a material misstatement when it exists. cotet of the stadaoe acia stateets Misstatements can arise from fraud or error and are icudi the discosures ad hether the cosidered ateria if idividua or i the areate stadaoe acia stateets represet the the coud reasoa e expected to iuece the uderi trasactios ad evets i a aer economic decisions of users taken on the basis of that achieves fair presentation. these stadaoe acia stateets e couicate ith those chared ith overace As part of an audit in accordance with SAs, we reardi ao other atters the paed scope exercise professioa udeet ad aitai ad tii of the audit ad siicat audit dis professioa septicis throuhout the audit e aso icudi a siicat deciecies i itera detif ad assess the riss of ateria cotro that e idetif duri our audit isstateet of the stadaoe acia e aso provide those chared ith overace ith stateets hether due to fraud or error desi a statement that we have complied with relevant and perform audit procedures responsive to ethica reuireets reardi idepedece ad to those risks, and obtain audit evidence that is communicate with them all relationships and other sufficiet ad appropriate to provide a asis for atters that a reasoa e thouht to ear our opiio he ris of ot detecti a ateria on our independence, and where applicable, related isstateet resuti fro fraud is hiher safeuards tha for oe resuti fro error as fraud a ivove cousio forer itetioa oissios ro the atters couicated ith those chared misrepresentations, or the override of internal ith overace e deterie those atters control. that ere of ost siicace i the audit of the stadaoe acia stateets of the curret period Otai a uderstadi of itera cotro and are therefore the key audit matters. We describe reevat to the audit i order to desi these matters in our auditor’s report unless law or audit procedures that are appropriate in the reuatio precudes puic discosure aout the circustaces der sectio i of the matter or when, in extremely rare circumstances, we Act e are aso resposie for expressi our determine that a matter should not be communicated opiio o hether the copa has adeuate i our report ecause the adverse coseueces of itera acia cotros ith referece to doi so oud reasoa e expected to outeih acia stateets i pace ad the operati the puic iterest eets of such couicatio effectiveess of such cotros Evauate the appropriateess of accouti Report on Other Legal and Regulatory policies used and the reasonableness of Requirements accouti estiates ad reated discosures i As reuired the Copaies Auditors eport the stadaoe acia stateets ade the Order the Order issued the Cetra aaeet ad oard of irectors overet i ters of sectio of the Act e ive i the Aexure A a stateet o Cocude o the appropriateess of the the atters specied i pararaphs ad of the aaeet ad oard of irectors use of the Order to the extet appicae oi cocer asis of accouti ad ased on the audit evidence obtained, whether a A As reuired ectio of the Act e material uncertainty exists related to events or report that coditios that a cast siicat dout o the Copas aiit to cotiue as a oi cocer If we conclude that a material uncertainty exists e are reuired to dra attetio i our

Lupin Limited | Annual Report 2019-20 a e have souht ad otaied a the i. The Company has disclosed the impact of information and explanations which to pedi itiatios as at arch o the est of our oede ad eief ere its acia positio i its stadaoe acia necessary for the purposes of our audit. stateets efer ote to the stadaoe acia stateets b) In our opinion, proper books of account as reuired a have ee ept the ii he Copa has ade provisio as reuired Company so far as it appears from our uder the appicae a or accouti examination of those books. standards, for material foreseeable losses, if a o oter cotracts icudi c) The standalone balance sheet, the standalone derivative contracts. stateet of prot icudi other comprehensive income), the standalone iii here has ee o dea i trasferri stateet of chaes i euit ad the aouts reuired to e trasferred to the stadaoe stateet of cash os deat vestor Educatio ad rotectio ud the ith this eport are i areeet ith the Company. books of account. iv he discosures i the stadaoe acia d) In our opinion, the aforesaid standalone stateets reardi hodis as e as acia stateets cop ith the d A deais i specied a otes duri specied uder sectio of the Act the period fro oveer to eceer have ot ee ade i these e O the asis of the ritte represetatios acia stateets sice the do ot pertai received from the directors as on to the acia ear eded arch arch tae o record the oard of irectors oe of the directors is (C) With respect to the matter to be included in the disuaied as o arch fro ei Auditors eport uder sectio appointed as a director in terms of Section our opiio ad accordi to the iforatio of the Act ad expaatios ive to us the reueratio f ith respect to the adeuac of the itera paid the copa to its directors duri the acia cotros ith referece to acia current year is in accordance with the provisions of stateets of the Copa ad the operati ectio of the Act he reueratio paid to effectiveess of such cotros refer to our any director is not in excess of the limit laid down separate Report in “Annexure B”. uder ectio of the Act he iistr of Corporate Affairs has ot prescried other detais (B) With respect to the other matters to be included uder ectio hich are reuired to e in the Auditor’s Report in accordance with Rule commented upon by us.

of the Copaies Audit ad Auditors ues For B S R & Co. LLP i our opiio ad to the est of our Chartered Accountants ir eistratio o iforatio ad accordi to the expaatios ive to us Venkataramanan Vishwanath ace uai arter ate a eership o AAAAC

214 Corporate Overview Statutory Reports Financial Statements

Annexure A to the Independent Auditor’s eport arch (Referred to our report of even date)

(i) (a) The Company has maintained proper records reasoae havi reard to the sie of the shoi fu particuars icudi uatitative Company and the nature of its assets. detais ad situatio of the xed assets c Accordi to the iforatio ad expaatios he Copa has a reuar prora of ive to us ad ased o the exaiatio phsica vericatio of its xed assets of the reistered sae deed trasfer deed hich a xed assets are veried i a coveace deed share certicate other phased manner over a period of three years. docuets evideci tite e report that accordace ith this prora a portio the title deeds of immovable properties of of the xed assets has ee phsica ad ad uidi hich are freehod as veried the aaeet duri the ear discosed i ote to the stadaoe acia and no material discrepancies have been statements, are held in the name of the oticed o such vericatio our opiio Copa except for the fooi this periodicit of phsica vericatio is

(` in million) Particulars of the land and Gross Block Net Block Remarks building (As at 31.03.2020) (As at 31.03.2020) Freehold land located in 29.6 29.6 The title deeds are in the name of the aharashtra adeasuri ersthie Copa that as aaaated 7 Hectare and 70.91 Acre with the Company pursuant to the Scheme of aaaatio sactioed the Hoe oa Hih Court reehod uidi ocated i The title deeds are in the name of erstwhile aharashtra adeasuri Copa that as aaaated ith sft 89.1 the Company pursuant to the Scheme of aaaatio sactioed the Hoe oa Hih Court

respect of iovae properties of ad ad uidis that have ee tae o ease ad discosed as xed asset i ote to the stadaoe d A acia stateets the ease areeets are i the ae of the Copa except the fooi (` in million) Particulars of the Gross Block Net Block Remarks building (As at 31.03.2020) (As at 31.03.2020) easehod uidi ocated The title deeds are in the name of erstwhile i ehi adeasuri Copa that as aaaated ith sft 2.8 the Company pursuant to the Scheme of aaaatio sactioed the Hoe oa Hih Court respect of iovae properties of ad ad uidis hich are discosed as xed asset i the stadaoe d A acia stateets the oriia docuets for the fooi assets are ot avaiae for vericatio (` in million) Particulars of the land and building Gross Block Net Block (As at 31.03.2020) (As at 31.03.2020) uidi ocated i aharashtra 7. 5 5.0 Land located in Uttarakhand

Lupin Limited | Annual Report 2019-20 215 ii vetories apart fro oods i trasit ad ee reuar deposited duri the ear ivetories i ith outside parties have ee the Company with the appropriate authorities. phsica veried the aaeet duri Accordi to the iforatio ad expaatios the year and the discrepancies noticed on such ive to us o udisputed aouts paae vericatio etee the phsica stoc ad i respect of rovidet fud Epoees book records were not material. In our opinion, state insurance, Income tax, duty of Customs, the freuec of such vericatio is reasoae oods ad ervice tax Cess ad other vetories i ith outside parties has ee material statutory dues were in arrears as at sustatia cored the as at the arch for a period of ore tha six year-end and no material discrepancies were months from the date they became payable. oticed i respect of such coratios Accordi to the iforatio ad expaatios iii Accordi to iforatio ad expaatios ive ive to us there are o dues of coe to us the Copa has ot rated a oas tax, Sales Tax, Value added tax, Service tax, secured or usecured to copaies rs iited dut of Custos oods ad ervice tax iaiit arterships or other parties covered i duty of Excise and Cess which have not been the reister aitaied uder sectio of the deposited with the appropriate authorities Copaies Act the Act Accordi on account of any dispute other than those pararaph iii of the Order is ot appicae to mentioned in Annexure I to this report. the Company. viii Accordi to the iforatio ad expaatios iv Accordi to the iforatio ad expaatio ive to us the Copa has ot defauted i ive to us the Copa has copied ith the repaet of oas or orrois to as or provisios of ectio ad of the Act i overet he Copa has ot tae a respect of the ivestets ade ad uaratees oas or orrois fro acia istitutios provided, as applicable. The Company has not and has not issued any debentures. rated a oas or provided a securit to the parties covered uder ectio ad of the (ix) The Company has not raised any money by way of Act. iitia puic offer further puic offer icudi det istruets ad ter oas duri the ear v Accordi to the iforatio ad expaatios Accordi pararaph ix of the Order is ot ive to us the Copa has ot accepted applicable to the Company. any deposits as per the directives issued by the Reserve Bank of India under the provisions of x uri the course of our exaiatio of the ectios to or a other reevat provisios books and records of the company, carried of the Act and the rules framed there under. out i accordace ith eera accepted Accordi pararaph v of the Order is ot auditi practices i dia ad accordi to the applicable to the Company. iforatio ad expaatios ive to us e have neither come across any instance of material fraud (vi) We have broadly reviewed the records maintained the Copa or o the Copa its officers by the Company pursuant to the rules prescribed or epoees oticed or reported duri the ear Cetra overet for aiteace of nor have we been informed of any such cases by cost records uder ectio of the Act the aaeet and are of the opinion that prima facie, the prescribed accounts and records have been made xi Accordi to the iforatio ad expaatios and maintained. However, we have not made a ive to us ad ased o our exaiatio of detailed examination of the records. the records of the Company, the Company has paidprovided for aaeria reueratio vii a Accordi to the iforatio ad i accordace ith the reuisite approvas expaatios ive to us ad o the asis adated the provisios of ectio read of our examination of the records of the with Schedule V to the Act. Company, amounts deducted / accrued in the books of account in respect of undisputed xii Accordi to the iforatio ad expaatios statutor dues icudi rovidet fud ive to us the Copa is ot a idhi copa Employees’ state insurance, Income tax, duty ad the idhi ues are ot appicae to it of Custos oods ad ervice tax Cess ad Accordi pararaph xii of the Order is ot other ateria statutor dues have eera applicable to the Company.

216 Corporate Overview Statutory Reports Financial Statements

xiii Accordi to the iforatio ad expaatios xv Accordi to the iforatio ad expaatios ive to us ad ased o our exaiatio ive to us ad ased o our exaiatio of of the records of the Company, transactions the records of the Company, the Company has with related parties are in compliance with the not entered into non-cash transactions with provisios of ectios ad of the Act its directors or persons connected with them. where applicable. The details of such related Accordi pararaph xv of the Order is ot party transactions have been disclosed in the applicable to the Company. stadaoe d A acia stateets as xvi our opiio ad accordi to the iforatio reuired uder dia Accouti tadard d ad expaatios ive to us the Copa A eated art iscosures specied uder is ot reuired to e reistered uder ectio ectio of the Act read ith the reevat A of the eserve a of dia Act rules issued thereunder. Accordi pararaph xvi of the Order is ot xiv Accordi to the iforatio ad expaatios applicable to the Company. ive to us ad ased o our exaiatio of For B S R & Co. LLP the records of the Company, the Company Chartered Accountants has not made any preferential allotment or ir eistratio o private placement of shares or fully or partly Venkataramanan Vishwanath covertie deetures duri the ear ace uai arter ate a eership o Accordi pararaph xiv of the Order is ot AAAAC applicable to the Company.

Lupin Limited | Annual Report 2019-20 217 Annexure – I to the Independent Auditor’s eport arch

Amounts of dues of Income tax, sales tax, Value added tax, Service tax, duty of Customs, duty of Excise which have not been deposited with the appropriate authorities on account of any dispute.

Name of the Statute Nature of Dues Forum where dispute is Period to which Amount Amount pending amount relates demanded unpaid (` million) (` million) coe tax Act Income tax Commissioner of Income tax (Appeals) Hih Court Central Excise Act, Excise duty Customs, Excise, and - eodi Service Tax Appellate matters Tribunal (CESTAT) Service Tax Matters Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Service Tax Matters Hih Court Central and Sales tax and Value Sales Tax Tribunal various States’ added tax Sales Tax Acts and various States’ Value Supreme Court Added Tax Acts Hih Court Commissioner of Sales Tax (Appeal) oit Coissioer eput Coissioer Additional Commissioner Assistant Commissioner - The Customs Act Customs duty Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Annexure B to the Independent Auditor’s Report on (Referred to in paragraph 2(A)(f) under ‘Report on the standalone financial statements of Lupin Limited Other Legal and Regulatory Requirements’ section of for the period ended March 31, 2020. our report of even date) Report on the internal financial controls with Opinion reference to the aforesaid standalone financial e have audited the itera acia cotros ith statements under Clause (i) of Sub-section 3 of referece to acia stateets of upi iited Section 143 of the Companies Act, 2013 the Copa as of arch i couctio ith our audit of the stadaoe acia stateets of the Company for the year ended on that date.

218 Corporate Overview Statutory Reports Financial Statements

In our opinion, the Company has, in all material ad testi ad evauati the desi ad operati respects adeuate itera acia cotros ith effectiveess of itera cotro ased o the referece to acia stateets ad such itera assessed risk. The procedures selected depend on acia cotros ere operati effective as at the auditors udeet icudi the assesset of arch ased o the itera acia the risks of material misstatement of the standalone cotros ith referece to acia stateets acia stateets hether due to fraud or error criteria estaished the Copa cosideri the We believe that the audit evidence we have obtained essential components of internal control stated in the is sufficiet ad appropriate to provide a asis for uidace ote o Audit of tera iacia Cotros our audit opiio o the Copas itera acia Over iacia eporti issued the stitute of cotros ith referece to acia stateets Chartered Accoutats of dia the uidace ote Meaning of Internal Financial Controls with Management’s Responsibility for Internal reference to Financial Statements Financial Controls A copas itera acia cotros ith referece he Copas aaeet ad the oard of to acia stateets is a process desied to irectors are resposie for estaishi ad provide reasoae assurace reardi the reiaiit aitaii itera acia cotros ased o of acia reporti ad the preparatio of acia the itera acia cotros ith referece to statements for external purposes in accordance acia stateets criteria estaished the ith eera accepted accouti pricipes Copa cosideri the essetia copoets A copas itera acia cotros ith referece of itera cotro stated i the uidace to acia stateets icude those poicies ad ote hese resposiiities icude the desi procedures that pertai to the aiteace of ipeetatio ad aiteace of adeuate records that, in reasonable detail, accurately and fairly itera acia cotros that ere operati reect the trasactios ad dispositios of the assets effective for esuri the order ad efficiet of the copa provide reasoae assurace coduct of its usiess icudi adherece to that transactions are recorded as necessary to permit copas poicies the safeuardi of its assets preparatio of acia stateets i accordace the prevention and detection of frauds and errors, the ith eera accepted accouti pricipes ad accurac ad copeteess of the accouti records that receipts and expenditures of the company are ad the tie preparatio of reiae acia ei ade o i accordace ith authorisatios of iforatio as reuired uder the Copaies Act aaeet ad directors of the copa ad hereiafter referred to as the Act provide reasoae assurace reardi prevetio or Auditor’s Responsibility tie detectio of uauthorised acuisitio use or Our resposiiit is to express a opiio o disposition of the company’s assets that could have a the Copas itera acia cotros ith ateria effect o the acia stateets referece to acia stateets ased o our Inherent Limitations of Internal Financial audit. We conducted our audit in accordance with Controls with reference to financial the uidace ote ad the tadards o Auditi statements prescried uder sectio of the Act to the Because of the inherent limitations of internal extet appicae to a audit of itera acia acia cotros ith referece to acia cotros ith referece to acia stateets stateets icudi the possiiit of cousio or hose tadards ad the uidace ote reuire iproper aaeet override of cotros ateria that e cop ith ethica reuireets ad misstatements due to error or fraud may occur and plan and perform the audit to obtain reasonable not be detected. Also, projections of any evaluation assurace aout hether adeuate itera acia of the itera acia cotros ith referece to cotros ith referece to acia stateets acia stateets to future periods are suect were established and maintained and whether such to the ris that the itera acia cotros ith cotros operated effective i a ateria respects referece to acia stateets a ecoe Our audit ivoves perfori procedures to iadeuate ecause of chaes i coditios or otai audit evidece aout the adeuac of the that the deree of copiace ith the poicies or itera acia cotros ith referece to acia procedures may deteriorate. stateets ad their operati effectiveess For B S R & Co. LLP Chartered Accountants Our audit of itera acia cotros ith referece ir eistratio o to acia stateets icuded otaii a Venkataramanan Vishwanath uderstadi of such itera acia cotros ace uai arter ate a eership o assessi the ris that a ateria eaess exists AAAAC

Lupin Limited | Annual Report 2019-20 219 Balance Sheet as at arch

(` in million) Note As at As at 31.03.2020 ASSETS Non-Current Assets a. ropert at ad Euipet 2 b. Capita oriroress c. taie Assets 676.9 d. taie Assets der eveopet 50 2,952.7 e. Financial Assets (i) Non-Current Investments - In Subsidiaries 4 Others 4 19.7 (ii) Non-Current Loans 5 447.2 627.4 iii Other oCurret iacia Assets 6 9.7 f. Non-Current Tax Assets (Net) 1,424.1 Other oCurret Assets 7 2,158.9 1,459.9 98,419.9 102,057.0 Current Assets a. Inventories 8 24,846.1 b. Financial Assets (i) Current Investments 9 (ii) Trade Receivables 10 iii Cash ad Cash Euivaets 11 11,680.2 559.4 iv Other a aaces 12 55.0 (v) Current Loans 229.1 vi Other Curret iacia Assets 14 c. Current Tax Assets (Net) 2.0 2.0 d. Other Curret Assets 15 7,422.4 94,845.1 TOTAL 206,805.0 196,902.1 EQUITY AND LIABILITIES Equity a. Euit hare Capita 16 906.0 905.0 b. Other Euit 17 170,267.7 171,172.7 Liabilities Non-Current Liabilities a. Financial Liabilities i oCurret orrois 18 ii rade aaes ota outstadi dues of icro Eterprises ad a Eterprises 19 - - ota outstadi dues of other tha icro Eterprises ad a 19 - 16.1 Enterprises iii Other oCurret iacia iaiities 20 1,195.9 149.6 b. oCurret rovisios 21 2,094.6 c. eferred ax iaiities et 46 1,929.4 2,662.2 d. Other oCurret iaiities 22 660.4 827.7 6,515.1 5,755.5 Current Liabilities a. Financial Liabilities i Curret orrois 52.9 16.8 ii rade aaes ota outstadi dues of icro Eterprises ad a Eterprises 24 989.4 1,046.1 ota outstadi dues of other tha icro Eterprises ad a 24 14,671.9 11,494.1 Enterprises iii Other Curret iacia iaiities 25 2,747.1 1,577.2 b. Other Curret iaiities 26 1,194.9 869.8 c. Curret rovisios 27 5,515.6 d. Current Tax Liabilities (Net) 66.1 25,557.9 TOTAL 206,805.0 196,902.1 ee accopai otes fori part of the acia stateets In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta arter Chairperson Vice Chairman Chief Executive Officer eership o Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam ace uai aai irector Executive irector oa CO Company Secretary ated a Head Corporate Affairs AC 220 Corporate Overview Statutory Reports Financial Statements

tateet of rot ad oss for the ear eded arch

(` in million) Note For the Current or the revious Year ended Year ended 31.03.2020 INCOME: eveue fro Operatios 28 110,256.6 Other coe 29 4,751.9 Total Income 115,008.5 116,476.6 EXPENSES: Cost of Materials Consumed urchases of tocirade 14,827.7 Chaes i vetories of iished oods (287.2) oriroress ad tocirade creaseecrease Epoee eets Expese 15,154.2 Finance Costs 525.9 epreciatio ad Aortisatio Expese 5,187.5 Other Expeses Total Expenses 96,893.9 89,653.1 Profit before Exceptional items and Tax 18,114.6 26,823.5 Exceptional items 50 7,592.1 Profit before Tax 10,522.5 23,423.7 Tax Expense 46 - Current Tax (Net) 7,950.0 eferred ax et 85.4 Total Tax Expense 3,247.0 8,035.4 Profit for the year 7,275.5 15,388.3 Other Comprehensive Income / (Loss) A i tes that i ot e recassied suseuet to prot or oss a eeasureets of eed eet iaiit (442.9) (16.8) ii coe tax reati to ites that i ot e recassied to prot or 46 154.8 6.0 oss i tes that i e recassied suseuet to prot or oss a he effective portio of ai osses o hedi istruets i (562.1) 15.2 a cash o hede ii coe tax reati to ites that i e recassied to prot or oss 46 157.7 0.5 Other Comprehensive Income / (Loss) for the year, net of tax (692.5) 4.9 Total Comprehensive Income for the year 6,583.0 15,393.2 Earis per euit share i `) Basic 16.07 34.03 Diluted 15.99 33.89 ace aue of Euit hare i `) 2.00 2.00 ee accopai otes fori part of the acia stateets In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta arter Chairperson Vice Chairman Chief Executive Officer eership o Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam ace uai aai irector Executive irector oa CO Company Secretary ated a Head Corporate Affairs AC

Lupin Limited | Annual Report 2019-20 221 6.1 0.8 (86.9) Euit (690.0) (804.5) ota Other ota ( ` in million) - 7,275.5 - - - - (2,260.8) - - (464.7) - 514.8 - - - (465.2) - - 60.4 (10.8) as (277.9) 156,945.4 (288.1) (576.8) 173,826.0 (288.7) 170,267.7 of the net eed eet Remeasurement Remeasurement ------16.9 7 7. 5 60.6 Other ites of Other Other ites (324.4) Hedes Comprehensive Income Comprehensive Effective Effective portion of Cash Flow Cash Flow ------(401.9) ------0.8 0.8 Share Money edi edi Allotment Application 0.8 ------904.2 905.0 905.0 317.9 317.9 ` in million Reserve Aaaatio - (86.9) As at (804.5) Earis Retained Retained No. of Shares No. 68.2 98.4 - eera Reserve 16,600.5 129,610.6 - - 7,275.5 ------(2,260.8) -- - - - (464.7) ------1.0 410,847 410,847 1.0 - - (465.2) -- - 70.4 905.0 452,082,850 905.0 906.0 906.0 Stock Stock 2,146.2 16,767.1 145,929.3 Optios Optios ` in million Employees Employees Outstadi Reserves and Surplus 8,129.5 9,175.5 8,644.3 2,184.2 16,668.7 142,273.4 reiu Securities ------514.8 ------As at 31.03.2020 As at 504,424 504,424 126.5 126.5 126.5 452,998,121 Capital Reserve No. of Shares No. Redemption Redemption ------ 263.9 263.9 Capital Reserve [Refer note 16] note [Refer articuars articuars Chaes i euit share capita duri the ear at the ed of reportiaace ear 31.03.2018 as at Balance 31.03.2019 as at Balance 31.03.2020 as at Balance aace at the eii of reportiaace ear rot for the ear for rot rot for the ear for rot Adjustment for transition to Ind AS 116 - "Leases" Ind AS 116 - "Leases" transition to for Adjustment iv ote efer Movement in other comprehensive income for the year for income comprehensive in other Movement Adjustment for transition to Appendex C of Ind AS 12 Appendex transition to for Adjustment d ote efer axes coe ia divided o Euit hares ia divided o Euit eceived duri the ear eceived Corporate ax o ivided ax Corporate Movement in other comprehensive income for the year for income comprehensive in other Movement Addition on allotment of shares on allotment Addition ia divided o Euit hares ia divided o Euit Share based payment to employees to Share based payment Corporate ax o ivided ax Corporate Addition on allotment of shares on allotment Addition Share based payment to employees to Share based payment A. Equity Share Capital A. Equity B. 17] note [Refer Other Equity tateet of Chaes i Euit Euit i Chaes of tateet eded arch the ear for

222 Corporate Overview Statutory Reports Financial Statements Vinita Gupta Vinita Chief Executive Officer Chief Executive R. V. Satam R. V. Company Secretary AC Dr. Kamal K. Sharma Dr. Vice Chairman Vice Ramesh Swaminathan Executive irector oa CO oa CO irector Executive Affairs Head Corporate For and on behalf of Board Directors Lupin Limited For Gupta Manju D. Chairperson Nilesh Deshbandhu Gupta aai irector he Capita reserve is created o receipts of overet rats for setti up the factories i acard areas for perfori the areas for research o critica edicies for i acard setti up the factories rats for of overet he Capita reserve o receipts is created schees of Aaatio of the Capita Copa uder various of the societ ad o restructuri etteret fro appropriatio purposes As the eera reserve a trasfer prots fro retaied earis for is created he eera reserve trasfer tie to is used fro tie to icoe coprehesive of other a ite ad is ot aother of euit to oe copoet portio portio hede reserve of desiated he cash o effective of ais or osses arisi o chaes i fair vaue represets the cuuative of hedi istruets portio of the desiated ai or oss arisi o chaes i fair vaue that are recoised of the hedi istruets he cuuative hedes Cash o for ito etered the prot or oss affect of prot ad oss o he the heded ites reserve uder the headi of cash o stateet i e recassed to ad accuuated ad directors certai to epoees ee rated shares have the Copas suscrie for to schees uder hich the optio optio stoc he Copa has epoee as part the epoees of their reueratio to provided shareased paets of euitsetted the vaue recoie his is used to Outstanding Options Stock Employees Reserve Capital Redemption allotment money Pending Share Application Capital Reserve Reserve Amalgamation Securities Premium In terms of our reportIn terms attached LLP B S R & Co. For Chartered Accountants o ir eistratio Vishwanath Venkataramanan arter eership o eership o ace uai ace a ated b) shares in earlier years. preference This reserve of redeemable cumulative represents redemption c) of the Copaies Act ith the specic provisio he reserve is utiised i accordace of preiu o issue shares coprises ecurities preiu accout d) General Reserve e) ad the Copa his reserve td aoratories upi represets creatio of aaaatio reserve ersthie the schee of aaaatio etee pursuat to f) Hedge Reserve Cash Flow g) h) as o reporti aotet date pedi for share appicatio oe hich ere toards hare appicatio oe represets aout received Nature of Reserves Nature a)

Lupin Limited | Annual Report 2019-20 Statement of Cash Flows for the ear eded arch

(` in million) For the Current or the revious Year ended Year ended 31.03.2020 A. Cash Flow from Operating Activities rot efore ax 10,522.5 Adustets for epreciatio ad Aortisatio Expese 5,187.5 pairet of taie assets taie asset uder deveopet - oss rot o ae riteoff of ropert at ad Euipet 17.6 (17.7) taie Assets et et ai o sae of utua ud vestets (1,062.8) (122.4) Finance Costs 525.9 terest o eposits ith as ad Others (80.2) ivided o utua ud vestets (145.6) (420.9) reaised oss ai o utua ud vestets et (2.4) (120.5) outfu rade eceivaes Advaces provided et 16.8 ad rade eceivaes Advaces ritte off - hare ased aets Expese 477.0 Impairment in value of Non-Current investments - rovisio for e Europea Coissio - reaised Exchae oss ai o revauatio et (1,490.2) (822.8) Operating Cash Flows before Working Capital Changes 17,707.9 29,996.8 Chaes i ori capita Adustets for icrease decrease i operati assets Inventories (1,259.6) Trade Receivables 2,757.4 Current Loans (119.8) (52.8) Non-Current Loans 180.2 (10.5) Other Curret iacia Assets (2,104.1) Other Curret Assets (1,104.4) Other oCurret Assets (105.6) 60.2 Other oCurret iacia Assets 4.6 (11.1) Adustets for icrease decrease i operati iaiities rade aaes (1,809.5) oCurret rade aaes (16.1) (15.5) Other Curret iacia iaiities Other Curret iaiities (426.0) Other oCurret iaiities Other oCurret iacia iaiities (5.8) 99.1 Curret rovisios 611.8 97. 5 oCurret rovisios 446.8 (159.0) Cash Generated from Operations 26,054.1 39,220.3 Net Income tax paid Net Cash Flow generated / (used in) from Operating Activities 22,194.9 31,107.2 B. Cash Flow from Investing Activities Capita expediture o ropert at ad Euipet icudi capita (5,181.1) (9,709.4) advances roceeds fro sae of ropert at ad Euipets taie Assets roceeds fro sae of oCurret vestets urchase of Curret vestets (89,820.9) roceeds fro sae of Curret vestets a aaces ot cosidered as Cash ad Cash Euivaets et (2.1) ivided o utua ud vestets 145.6 420.9 terest o eposits ith as ad others 80.2 Net Cash Flow generated / (used in) from Investing Activities (7,395.6) (28,650.7)

224 Corporate Overview Statutory Reports Financial Statements

Statement of Cash Flows for the ear eded arch

(` in million) For the Current or the revious Year ended Year ended 31.03.2020 C. Cash Flow from Financing Activities roceeds fro epaet of o Curret orrois et (48.1) roceeds fro epaet of Curret orrois et roceeds fro issue of euit shares EOs 1.0 0.8 ecurities reiu eceived EOs 58.7 aet of ease iaiities (798.2) - Finance Costs (210.9) ivided paid (2,264.6) (2,248.4) Corporate ax o ivided (465.2) (464.7) Net Cash Flow generated / (used in) from Financing Activities (3,678.5) (2,953.8) Net Increase / (Decrease) in Cash and Cash Equivalents 11,120.8 (497.3) Cash ad Cash Euivaets as at the eii of the ear 559.4 1,056.7 Cash and Cash Equivalents as at end of the reporting year (Refer note 11) 11,680.2 559.4

otes he aove Cash o tateet has ee prepared uder the direct ethod as set out i the dia Accouti Standard 7 (Ind AS -7) “Statement of Cash Flow”.

Cash coprises cash o had ad curret accouts ith as Cash euivaets are shortter aaces ith a oriia aturit of three oths or ess fro the date of acuisitio curret ivestets that are covertie ito o aouts of cash ad hich are suect to isiicat ris of chaes i vaue

In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o

Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta arter Chairperson Vice Chairman Chief Executive Officer eership o

Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam ace uai aai irector Executive irector oa CO Company Secretary ated a Head Corporate Affairs AC

Lupin Limited | Annual Report 2019-20 225 Notes ori part of the tadaoe iacia tateets

1A. OVERVIEW: Basis of measurement upi iited the Copa icorporated iii hese stadaoe acia stateets are i is a iovatio ed rasatioa prepared under the historical cost convention haraceutica Copa produci deveopi unless otherwise indicated. ad areti a ide rae of raded ad Use of Estimates and Judgements eeric foruatios iotechoo products ad iv) The preparation of the Standalone Financial active pharaceutica irediets As oa tateets i coforit ith d A reuires he Copa has siicat presece i the the aaeet to ae estiates ad Cardiovascuar iaetoo Asthaa ediatrics assumptions considered in the reported Cetra ervous ste astrotestia aouts of assets ad iaiities icudi Anti-Infectives and Nonsteroidal Anti cotiet iaiities ad the reported aator ru therap seets ad is a icoe ad expeses duri the ear oa eader i the Ati ad Cephaosporis he aaeet eieves that the estiates seets he Copa ao ith its used in preparation of the Standalone susidiaries has aufacturi ocatios spread Financial Statements are prudent and across dia A exico ad rai ith tradi reasoae uture resuts coud differ due to and other incidental and related activities these estiates ad the differeces etee extedi to the oa arets the actual results and the estimates are The Company is a public limited company recoised i the periods i hich the resuts incorporated and domiciled in India. The address are known/materialised. Estimates and of its reistered office is apataru spire rd uderi assuptios are revieed o a oor ester Express Hiha atacru East ooi asis uai foratio aout critica udets i 1B. SIGNIFICANT ACCOUNTING POLICIES: appi accouti poicies as e as estimates and assumptions that have a) Basis of accounting and preparation of the ost siicat effect to the carri Standalone Financial Statements: amounts of assets and liabilities within Basis of preparation the ext acia ear are icuded i the i hese stadaoe acia stateets of the accouti poicies Company have been prepared in all material aspects i accordace ith the recoitio easureet of deed eet oiatios and measurement principles laid down in (Refer note l) dia Accouti tadards hereiafter - Measurement and likelihood of occurrence of referred to as the d A as otied uder provisios ad cotiecies efer ote o sectio of the Copaies Act ecoitio of deferred tax assets efer ote the Act read ith ue of the Copaies i) dia Accouti tadards ues sefu ives of propert pat ad euipet as amended and other relevant provisions of ad itaies efer ote c the Act ad accouti pricipes eera - Impairment of assets (Refer note f) accepted i dia hese stadaoe acia pairet of acia assets efer ote h stateets ere authoried for issue the rovisio for coe taxes ad ucertai tax Copas oard of irectors o a positions (refer note i) - Accrual of Sales return and other applicable trade discounts and allowances (refer note k) Functional and Presentation Currency - Share-based payment transactions (Refer ii hese stadaoe acia stateets note m) are presented in Indian rupees, which is the functional currency of the Company. b) Property, Plant and Equipment & A acia iforatio preseted i dia Depreciation: rupees has been rounded to the nearest I. Recognition and Measurement: million, except otherwise indicated. tes of propert pat ad euipet are measured at cost less accumulated

226 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

depreciation and impairment losses, if any. the useful life prescribed in Schedule II to The cost of an item of property, plant and the Act except i respect of the fooi euipet coprises cateories of assets i hose case the ife of the assets has been assessed as under based its purchase price icudi iport duties on independent technical evaluation and and non-refundable purchase taxes, after aaeets assesset thereof tai deducti trade discouts ad reates into account the nature of the asset, the a costs direct attriutae to rii the estiated usae of the asset the operati asset to the location and condition necessary conditions of the asset, past history of for it to e capae of operati i the aer repaceet aticipated techooica iteded aaeet chaes aufacturers arraties ad maintenance support, etc. the iitia estiate of the costs of disati ad reovi the ite ad restori the site Particulars Estimated Useful Life o hich it is ocated the oiatio for hich Leasehold Land Over the period of the Company incurs either when the item lease is acuired or as a coseuece of havi Improvements on Leased Over the period of used the ite duri a particuar period for reises lease purposes other than to produce inventories at ad Euipet to ears duri that period Office Euipet estop ears - income and expenses related to the incidental Certain assets provided to ears operatios ot ecessar to ri the ite employees to the location and condition necessary for epreciatio ethod usefu ive ad residua it to e capae of operati i the aer vaues are revieed at each acia ear ed iteded aaeet are recoised i and adjusted if appropriate. tateet of rot ad oss f siicat parts of an item of property, plant and epreciatio o additios disposas is euipet have differet usefu ives the provided on a pro-rata basis i.e. from (upto) they are accounted for as separate items the date on which asset is ready for use (major components) of property, plant and (disposed of). euipet c) Intangible assets: A ai or oss o disposa of a ite of I. Recognition and Measurement: propert pat ad euipet is recoised i taie assets are carried at cost ess tateet of rot ad oss accumulated amortisation and impairment osses if a he cost of a itaie asset Capita oriproress i respect of assets coprises of its purchase price icudi which are not ready for their intended use are any import duties and other taxes (other carried at cost coprisi of direct costs reated tha those suseuet recoverae fro incidental expenses and attributable interest. the taxi authorities ad a direct II. Subsequent Expenditure attriutae expediture o ai the asset useuet expediture is capitaised o ready for its intended use. if it is probable that the future economic Expenditure on research and development eets associated ith the expediture i eiie for capitaisatio are carried as o to the Copa taie assets uder deveopet here III. Depreciation such assets are not yet ready for their epreciae aout for assets is the cost of intended use. an asset, or other amount substituted for cost, II. Subsequent Expenditure less its estimated residual value. useuet expediture is capitaised o epreciatio o propert pat ad if it is probable that the future economic euipet of the Copa has ee eets associated ith the expediture i provided o the straihtie ethod as per o to the Copa

Lupin Limited | Annual Report 2019-20 227 Notes Forming part of the Standalone Financial Statements

III. Amortisation complete the development and to use and sell the taie assets are aortised over their asset. estiated usefu ife o traiht ie ethod aets to third parties that eera tae the as foos form of up-front payments and milestones for Particulars Estimated Useful Life in-licensed products, compounds and intellectual Computer Software to ears property are capitalised since the probability of Trademark and Licenses to ears expected future ecooic eets criterio is ossiersareti ihts ears aas cosidered to e satised for separate acuired itaie assets he estiated usefu ives of itaie assets f) Impairment of assets: and the amortisation period are reviewed he carri vaues of assetscash eerati at the ed of each acia ear ad the units at each balance sheet date are reviewed for aortisatio ethod is revised to reect the impairment if any indication of impairment exists. chaed patter if a he fooi itaie assets are tested for d) Non-current assets held for sale: ipairet each acia ear eve if there is o Assets are cassied as hed for sae ad stated at idicatio that the asset is ipaired the oer of carri aout ad fair vaue ess i a itaie asset that is ot et avaiae costs to sell if the asset is available for immediate for use; and sae ad its sae is hih proae uch assets ii a itaie asset that is havi ideite or roup of assets are preseted separate i the useful life. aace heet as Assets Cassied as Hed for f the carri aout of the assets exceed ae Oce cassied as hed for sae itaie the estimated recoverable amount, an assets ad propert pat ad euipet are o ipairet is recoised for such excess oer aortised or depreciated aout he ipairet oss is recoised e) Research and Development: as a expese i the tateet of rot ad eveue expediture pertaii to research is Loss, unless the asset is carried at revalued chared to the tateet of rot ad oss amount, in which case any impairment loss of eveopet costs of products are aso chared the revalued asset is treated as a revaluation to the tateet of rot ad oss i the ear decrease to the extent a revaluation reserve is it is icurred uess a products techooica available for that asset. feasibility has been established, in which case he recoverae aout is the reater of the such expenditure is capitalised. These costs et sei price ad their vaue i use aue i are chared to the respective heads i the use is arrived at discouti the future tateet of rot ad oss i the ear it is cash os to their preset vaue ased o a incurred. The amount capitalised comprises of appropriate discount factor. expenditure that can be directly attributed or allocated on a reasonable and consistent basis When there is indication that an impairment for creati produci ad ai the asset oss recoised for a asset other tha a read for its iteded use ropert at ad revaued asset i earier accouti periods Euipet utiised for research ad deveopet o oer exists or a have decreased such are capitalised and depreciated in accordance reversa of ipairet oss is recoised ith the poicies stated for ropert at ad i the tateet of rot ad oss to the Euipet extet the aout as previous chared to the tateet of rot ad oss case Expenditure on in-licensed development activities, of revalued assets, such reversal is not here research dis are appied to a pa or recoised desi for the productio of e or sustatia improved products and processes, is capitalised, g) Foreign Currency Transactions/Translations: if the cost can be reliably measured, the product i rasactios deoiated i forei currec or process is technically and commercially feasible are recorded at exchae rates prevaii at ad the Copa has sufficiet resources to the date of transaction or at rates that closely

228 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

approximate the rate at the date of the saes of acia assets that reuire deiver transaction. of assets within a time frame established by reuatio or covetio i the aret pace ii) Monetary assets and liabilities denominated reuar a trades are recoised o the i forei currecies at the reporti date trade date, i.e. the date that the Company are translated into the functional currency commits to purchase or sell the asset. at the exchae rate of the reporti date Non-monetary assets and liabilities that are Financial assets at amortised cost easured ased o historica cost i a forei A acia asset is easured at the currec are trasated at the exchae rate aortised cost if oth the fooi at the date of the transaction. coditios are et iii Exchae differeces arisi o the i) the asset is held within a business model settlement of monetary items or on whose objective is to hold assets for trasati oetar ites except for coecti cotractua cash os ad o ter oetar ites outstadi as ii cotractua ters of the asset ive rise at arch at rates differet fro o specied dates to cash os that those at which they were translated on are solely payments of principal and iitia recoitio duri the period or i iterest o the pricipa aout previous stadaoe acia stateets are outstadi recoied i the tateet of rot ad oss in the period in which they arise. After iitia easureet such acia assets are suseuet easured at iv case of o ter oetar ites aortised cost usi the effective iterest rate outstadi as at arch (EIR) method. Amortised cost is calculated by exchae differeces arisi o setteet tai ito accout a discout or preiu restatement thereof are capitalised as part ad fees or costs that are a itera part of the depreciae xed assets to hich the of the EIR. The EIR amortisation is included monetary item relates and depreciated over i ace icoe i the tateet of rot the reaii usefu ife of such assets f such ad oss he osses arisi fro ipairet oetar ites do ot reate to acuisitio are recoised i the tateet of rot ad of depreciae xed assets the exchae oss his cateor eera appies to trade differece is aortised over the aturit and other receivables. period/upto the date of settlement of such monetary items, whichever is earlier, and Financial assets included within the fair value chared to the tateet of rot ad oss throuh prot ad oss cateor are easured at fair vaue ith a chaes h) Financial Instruments: recoied i the tateet of rot ad I. Financial Assets Loss. Classification O iitia recoitio the Copa cassies Equity investments acia assets as suseuet easured A euit ivestets i scope of d A are at aortised cost fair vaue throuh other easured at fair vaue Euit istruets hich coprehesive icoe or fair vaue throuh are hed for tradi are cassied as at prot or oss o the asis of its usiess or a other euit istruets the Copa ode for aai the acia assets ad decides to classify the same either as at fair value the cotractua cash o characteristics of throuh other coprehesive icoe OC or the acia asset he Copa aes such eectio o a istruetistruet asis he cassicatio Initial recognition and measurement is ade o iitia recoitio ad is irrevocae A acia assets ot easured suseuet at fair vaue throuh prot or f the Copa decides to cassif a euit oss are recoised iitia at fair vaue pus istruet as at OC the a fair vaue transaction costs that are attributable to the chaes o the istruet excudi divideds acuisitio of the acia asset urchases or are recoied i other coprehesive icoe

Lupin Limited | Annual Report 2019-20 229 Notes Forming part of the Standalone Financial Statements

OC here is o recci of the aouts fro Copas cotiui ivoveet that OC to tateet of rot ad oss eve o sae case the Copa aso recoises a of such investments. associated liability. The transferred asset and the associated liability are measured on a Euit istruets icuded ithi the asis that reects the rihts ad oiatios cateor are easured at fair vaue ith a that the Company has retained. chaes recoied i the tateet of rot ad Loss. Cotiui ivoveet that taes the for of a uaratee over the trasferred asset is Investments in subsidiaries and joint venture easured at the oer of the oriia carri Investments in subsidiaries and joint venture amount of the asset and the maximum are carried at cost less accumulated impairment amount of consideration that the Company losses, if any. Where an indication of impairment coud e reuired to repa exists the carri aout of the ivestet is assessed and written down immediately to its Impairment of financial assets recoverae aout O disposa of ivestets accordace ith d A the Copa i susidiaries ad oit veture the differece applies Expected Credit Loss (ECL) model for etee et disposa proceeds ad the carri easureet ad recoitio of ipairet oss aouts are recoied i the stateet of prot o the fooi acia assets ad credit ris and loss. exposure

Derecognition i acia assets that are det istruets ad A acia asset or here appicae a part of are easured at aortised cost e oas a acia asset or part of a Copa of siiar debt securities, deposits, and bank balance. acia assets is priari derecoised ie ii) trade receivables. removed from the Company’s balance sheet) he he Copa foos sipied approach for recoitio of ipairet oss aoace o trade he rihts to receive cash os fro the asset receivaes hich do ot cotai a siicat have expired, or aci copoet he Copa has trasferred its rihts to he appicatio of sipied approach does receive cash os fro the asset or has ot reuire the Copa to trac chaes i assued a oiatio to pa the received credit ris ather it recoises ipairet cash os i fu ithout ateria dea loss allowance based on lifetime ECLs at each to a third part uder a passthrouh reporti date riht fro its iitia recoitio arraeet ad either II. Financial Liabilities i) the Company has transferred substantially all Classification the risks and rewards of the asset, or he Copa cassies a acia iaiities ii) the Company has neither transferred nor as suseuet easured at aortised cost retained substantially all the risks and rewards except for acia iaiities easured at fair of the asset, but has transferred control of the vaue throuh prot or oss uch iaiities asset. icudi derivatives that are iaiities are suseuet easured at fair vaue ith he the Copa has trasferred its rihts chaes i fair vaue ei recoised i the to receive cash os fro a asset or has tateet of rot ad oss etered ito a passthrouh arraeet it evaluates if and to what extent it has Initial recognition and measurement retained the risks and rewards of ownership. iacia iaiities are cassied at iitia When it has neither transferred nor retained recoitio as acia iaiities at fair vaue substantially all of the risks and rewards throuh prot or oss at aortised cost oas of the asset, nor transferred control of the orrois ad paaes or as derivatives asset the Copa cotiues to recoise desiated as hedi istruets i a the transferred asset to the extent of the effective hede as appropriate

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

A acia iaiities are recoised iitia Aortised cost is cacuated tai at fair value and, in the case of loans and into account any discount or premium on orrois ad paaes et of direct acuisitio ad fees or costs that are a attributable transaction costs. itera part of the E he E aortisatio is icuded as ace costs i the tateet he Copas acia iaiities icude of rot ad oss trade and other payables, loans and orrois icudi a overdrafts his cateor eera appies to acia uaratee cotracts ad derivative iteresteari oas ad orrois acia istruets Derecognition Financial liabilities at fair value through prof- A acia iaiit is derecoised he the it or loss oiatio uder the iaiit is dischared iacia iaiities at fair vaue throuh prot or caceed or expires he a existi or oss icude acia iaiities hed for acia iaiit is repaced aother fro tradi ad acia iaiities desiated the sae eder o sustatia differet upo iitia recoitio as at fair vaue ters or the ters of a existi iaiit are throuh prot or oss iacia iaiities sustatia odied such a exchae or are cassied as hed for tradi if the are odicatio is treated as the derecoitio icurred for the purpose of repurchasi i of the oriia iaiit ad the recoitio of the ear ter his cateor aso icudes a e iaiit he differece i the respective derivative acia istruets etered ito carri aouts is recoised i the the Copa that are ot desiated as tateet of rot ad oss hedi istruets i hede reatioships as Embedded derivatives deed d A eparated eedded If the hybrid contract contains a host that is derivatives are aso cassied as hed for a acia asset ithi the scope dA tradi uess the are desiated as effective the Company does not separate embedded hedi istruets derivatives ather it appies the cassicatio ais or osses o iaiities hed for tradi reuireets cotaied i d A to the are recoised i the tateet of rot ad etire hrid cotract erivatives eedded Loss. in all other host contracts are accounted for as separate derivatives and recorded at fair value iacia iaiities desiated upo iitia if their economic characteristics and risks recoitio at fair vaue throuh prot or are not closely related to those of the host oss are desiated at the iitia date of contracts and the host contracts are not held recoitio ad o if the criteria i dA for tradi or desiated at fair vaue throuh are satised or iaiities desiated as prot or oss hese eedded derivatives are fair vaue aisosses attriutae to easured at fair vaue ith chaes i fair chaes i o credit ris are recoised i vaue recoised i tateet of rot ad OC hese aisosses are ot suseuet oss uess desiated as effective hedi trasferred to tateet of rot ad oss instruments. Reassessment only occurs if However, the Company may transfer the there is either a chae i the ters of the cuuative ai or oss ithi euit A other cotract that siicat odies the cash chaes i fair vaue of such iaiit are os recoised i the tateet of rot ad Loss. Offsetting of financial instruments iacia assets ad acia iaiities Loans and borrowings are offset ad the et aout is reported After iitia recoitio iteresteari oas in the balance sheet if there is a currently ad orrois are suseuet easured eforceae ea riht to offset the at aortised cost usi the E ethod recoised aouts ad there is a itetio ais ad osses are recoised i tateet to settle on a net basis, to realise the assets of rot ad oss he the iaiities are and settle the liabilities simultaneously. derecoised

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

Derivative financial instruments III. Measurement he Copa uses derivative acia The Company determines the fair value of its istruets such as forei exchae acia istruets o the asis of the fooi forward contracts, interest rate swaps and hierarch currec optios to aae its exposure a eve he fair vaue of acia istruets to iterest rate ad forei exchae riss uoted i active arets is ased o their uch derivative acia istruets are uoted cosi price at the aace sheet iitia recoised at fair vaue o the date o date. which a derivative contract is entered into and are suseuet reeasured at fair vaue eve he fair vaue of acia istruets erivatives are carried as acia assets that are not traded in an active market is he the fair vaue is positive ad as acia deteried usi vauatio techiues iaiities he the fair vaue is eative usi oservae aret data uch vauatio techiues icude discouted cash os Hedge Accounting standard valuation models based on market he Copa uses forei currec forard parameters for interest rates, yield curves cotracts to hede its riss associated or forei exchae rates deaer uotes for ith forei currec uctuatios reati similar instruments and use of comparable to hih proae forecast trasactios ars eth trasactios he Copa desiates such forard cotracts i a cash o hedi reatioship c eve he fair vaue of acia istruets appi the hede accouti pricipes that are measured on the basis of entity These forward contracts are stated at fair specic vauatios usi iputs that are vaue at each reporti date Chaes i the not based on observable market data fair value of these forward contracts that (unobservable inputs). are desiated ad effective as hedes of i) Income tax: future cash os are recoised direct Income tax expense consists of current and i OC ad accuuated i Cash o deferred tax coe tax expese is recoised Hede eserve Accout uder Other Euit i the tateet of rot ad oss except to net of applicable deferred income taxes the extet that it reates to ites recoised ad the ieffective portio is recoised in other comprehensive income or directly in iediate i the tateet of rot ad euit this case the tax is aso recoied i Loss. Amounts accumulated in the “Cash other coprehesive icoe or direct i euit o Hede eserve Accout are recassied respectively. to the tateet of rot ad oss i the sae period duri hich the forecasted Current tax trasactio affects tateet of rot ad Current tax comprises the expected tax payable oss Hede accouti is discotiued or receivable on the taxable income or loss for he the hedi istruet expires or is the year and any adjustment to the tax payable sod teriated or exercised or o oer or receivable in respect of previous years. It is uaies for hede accouti or forecasted easured usi tax rates eacted or sustative trasactios a cuuative ai or oss o eacted at the reporti date the hedi istruet recoised i Cash Curret tax assets ad iaiities are offset o if o Hede eserve Accout is retaied the Copa until the forecasted transaction occurs. If the forecasted trasactio is o oer expected i has a ea eforceae riht to set off the to occur the et cuuative ai or oss recoised aouts ad recoised i Cash o Hede eserve ii) Intends either to settle on a net basis, or Account” is immediately transferred to the to realise the asset and settle the liability tateet of rot ad oss simultaneously.

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

Deferred tax ii) The deferred tax assets and the deferred tax eferred taxes are recoised i respect of liabilities relate to income taxes levied by the teporar differeces etee the carri same taxation authority on the same taxable aouts of assets ad iaiities for acia entity. reporti purposes ad the aouts used for j) Inventories: taxation purposes. Inventories of all procured materials and Stock-in- eferred tax assets are recoised for uused rade are vaued at the oer of cost o ovi tax losses, unused tax credits and deductible eihted averae asis ad the et reaisae teporar differeces to the extet that it vaue after providi for osoescece ad other is proae that future taxae prots i losses, where considered necessary. Cost includes e avaiae aaist hich the ca e used a chares i rii the oods to their preset eferred tax assets are revieed at each reporti ocatio ad coditio icudi ocreditae date and are reduced to the extent that it is no taxes and other levies, transit insurance and oer proae that the reated tax eet i receivi chares oriprocess ad ished be realised; such reductions are reversed when the oods icude appropriate proportio of proaiit of future taxae prots iproves overheads and, where applicable, excise duty. recoised deferred tax assets are reassessed k) Revenue Recognition: at each reporti date ad recoised to the Sale of Goods extent that it has become probable that future The majority of the Company’s contracts related taxae prots i e avaiae aaist hich the to product sales include only one performance can be used. oiatio hich is to deiver products to customers based on purchase orders received. he Copa recoises deferred tax iaiit eveue fro saes of products is recoied for a taxae teporar differeces associated at a point in time when control of the products with investments in subsidiaries, branches and is trasferred to the custoer eera upo associates ad iterests i oit arraeets delivery, which the Company has determined is except to the extet that oth of the fooi he phsica possessio ea tite ad riss ad coditios are satised rewards of ownership of the products transfer i) When the Company is able to control the to the customer and the Company is entitled tii of the reversa of the teporar to paet he tii of the trasfer of riss differece ad ad reards varies depedi o the idividua ters of the saes areeets eveue fro ii it is proae that the teporar differece the sae of oods is easured at the fair vaue will not reverse in the foreseeable future. of the consideration received or receivable (after eferred taxes are easured at the tax rates icudi fair vaue aocatios reated to utipe that are expected to be applied to temporary deiverae ador ied arraeets et differeces he the reverse usi tax rates of returs saes tax ad appicae trade eacted or sustative eacted at the reporti discounts and allowances. Revenue includes date. shippi ad hadi costs ied to the customer. he easureet of deferred taxes reects the tax coseueces that oud foo fro the Income from research services manner in which the Company expects, at the coe fro research services icudi sae of reporti date to recover or sette the carri techoooho rihts iceses ad other amount of its assets and liabilities. itaies is recoised i accordace ith the terms of the contract with customers when the eferred tax assets ad iaiities are offset o reated perforace oiatio is copeted if or when risks and rewards of ownership are i the Copa has a ea eforceae riht transferred, as applicable. to set off curret tax assets aaist curret The Company enters into certain dossier sales, tax liabilities; and icesi ad supp arraeets that i

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

certain instances, include certain performance asset is limited to the present value of economic oiatios ased o a evauatio of hether eets avaiae i the for of a future or ot these oiatios are icoseuetia or refunds from the plan or reductions in future perfuctor the Copa recoise or defer contributions to the plan. To calculate the present the upfront payments received under these vaue of ecooic eets cosideratio is ive arraeets to a appicae iiu fudi reuireets

Interest income eeasureet of the et deed eet terest icoe is recoised ith referece to the iaiit hich coprise actuaria ais ad Effective terest ate ethod osses ad the retur o pa assets excudi iterest ad the effect of the asset ceii if a Dividend income excudi iterest are recoised iediate i ivided fro ivestet is recoised as other coprehesive icoe OC et iterest reveue he riht to receive is estaished expese icoe o the et deed iaiit Income from Export Benefits and Other Incen- asset is coputed appi the discout tives rate used to easure the et deed iaiit Export eets avaiae uder prevaet schees (asset). Net interest expense and other expenses are accrued as revenue in the year in which the reated to deed eet pas are recoised i oods are exported ad or services are redered tateet of rot ad oss only when there reasonable assurance that the he the eets of a pa are chaed or conditions attached to them will be complied he a pa is curtaied the resuti chae i with, and the amounts will be received. eet that reates to past service or the ai l) Employee Benefits: or oss o curtaiet is recoised iediate Short term employee benefits i tateet of rot ad oss he Copa hortter epoee eets are expesed recoises ais ad osses o the setteet of a as the related service is provided. A liability is deed eet pa he the setteet occurs recoised for the aout expected to e paid if Other long-term employee benefits the Copa has a preset ea or costructive he Copas et oiatio i respect of oiatio to pa this aout as a resut of oter epoee eets is the aout past service provided by the employee and the of future eet that epoees have eared oiatio ca e estiated reia in return for their service in the current and Defined contribution plans prior periods he oiatio is easured o Oiatios for cotriutios to deed the basis of a periodical independent actuarial contribution plans are expensed as the related vauatio usi the proected uit credit ethod service is provided and the Company will have eeasureet are recoised i tateet of o ea or costructive oiatio to pa further rot ad oss i the period i hich the arise aouts repaid cotriutios are recoised m) Share-based payment transactions: as an asset to the extent that a cash refund or a Epoees toc Optios as EOs reduction in future payments is available. he rat date fair vaue of optios rated Defined benefit plans to epoees is recoied as a epoee he Copas et oiatio i respect of expese ith a correspodi icrease i deed eet pas is cacuated separate for euit over the period that the epoees each pa estiati the aout of future become unconditionally entitled to the options. eet that epoees have eared i the curret The expense is recorded for each separately ad prior periods discouti that aout ad vesti portio of the aard as if the aard as deducti the fair vaue of a pa assets in substance, multiple awards. The increase in euit recoied i coectio ith share ased he cacuatio of deed eet oiatios payment transaction is presented as a separate is performed periodically by an independent copoet i Other Euit uder Epoee uaied actuar usi the proected uit credit toc Optios Outstadi eserve he aout method. When the calculation results in a recoied as a expese is adusted to reect the potetia asset for the Copa the recoised actual number of stock options that vest. Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements n) Leases: are not paid at the commencement date of the At inception of a contract, the Company ease he ease paets are discouted usi assesses whether a contract is, or contains, a the interest rate implicit in the lease, If that rate lease. A contract is, or contains, a lease if the cannot be readily determined, the Company cotract coves the riht to cotro the use uses icreeta orroi rate eera the of a idetied asset for a period of tie i Copa uses its icreeta orroi rate as exchae for cosideratio o assess hether a the discount rate. The Company determines its cotract coves the riht to cotro the use of a icreeta orroi rate otaii iterest idetied asset the Copa uses the deitio rates fro various extera aci sources of a ease i d A his poic is appied to ad aes certai adustets to reect the cotracts etered ito o or after st Apri terms of the lease and type of the asset leased. For leases with reasonably similar characteristics, Company as a lessee the Company, on a lease by lease basis, may adopt The Company accounts for each lease component either the icreeta orroi rate specic within the contract as a lease separately from to the ease or the icreeta orroi rate non-lease components of the contract and for the portfolio as a whole. The lease payments allocates the consideration in the contract to sha icude xed paets variae ease each lease component on the basis of the relative paets residua vaue uaratees exercise stand-alone price of the lease component and price of a purchase option where the Company the areate stadaoe price of the oease is reasonably certain to exercise that option components. ad paets of peaties for teriati he Copa recoises rihtofuse asset the ease if the ease ter reects the essee represeti its riht to use the uderi asset exercisi a optio to teriate the ease for the lease term at the lease commencement he ease iaiit is suseuet reeasured date he cost of the rihtofuse asset easured icreasi the carri aout to reect at inception shall comprise of the amount of iterest o the ease iaiit reduci the the initial measurement of the lease liability carri aout to reect the ease paets adjusted for any lease payments made at or ade ad reeasuri the carri aout to before the commencement date less any lease reect a reassesset or ease odicatios incentives received, plus any initial direct costs or to reect revised isustace xed ease incurred and an estimate of costs to be incurred paets he copa recoises the aout the essee i disati ad reovi the of the re-measurement of lease liability due to uderi asset or restori the uderi asset odicatio as a adustet to the rihtofuse or site o hich it is ocated he rihtofuse asset ad stateet of prot ad oss depedi assets is suseuet easured at cost ess upo the ature of odicatio here the any accumulated depreciation, accumulated carri aout of the rihtofuse asset is impairment losses, if any and adjusted for reduced to ero ad there is a further reductio any remeasurement of the lease liability. in the measurement of the lease liability, the he rihtofuse assets is depreciated usi the Copa recoises a reaii aout of the straihtie ethod fro the coeceet reeasureet i stateet of prot ad oss date over the shorter of lease term or useful The Company has elected not to apply the ife of rihtofuse asset he estiated usefu reuireets of d A eases to shortter ives of rihtof use assets are deteried o eases of a assets that have a ease ter of the same basis as those of property, plant and oths or ess ad eases for hich the uderi euipet ihtofuse assets are tested for asset is of low value. The lease payments impairment whenever there is any indication that associated ith these eases are recoied as their carri aouts a ot e recoverae a expese o a straihtie asis over the ease pairet oss if a is recoised i the term. stateet of prot ad oss Transition to Ind AS 116 The Company measures the lease liability at iistr of Corporate Affairs CA throuh the present value of the lease payments that Copaies dia Accouti tadards

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

Aedet ues ad Copaies dia O trasitio the Copa recoised Accouti tadards ecod Aedet ues a lease liability measured at the present has otied d A eases hich repaces vaue of the reaii ease paets ut the existi ease stadard d A eases discounted at the Company’s incremental ad other iterpretatios d A sets out orroi rate as at st Apri the pricipes for the recoitio easureet he rihtofuse asset is recoised at its presentation and disclosure of leases for both carri aout as if the stadard had ee essees ad essors t itroduces a sie applied since the commencement of the lease. oaace sheet ease accouti ode for Accordi a rihtofuse asset of ` iio lessees. ad a correspodi ease iaiit of ` iio has ee recoied he cuuative he Copa has adopted d A effective effect o trasitio i retaied earis et off aua reporti period eii Apri taxes ad ease euaiatio iaiit is ` ad appied the stadard to its eases iio icudi a deferred tax of ` iio retrospective ith the cuuative effect of ad ease euaiatio iaiit of ` iio iitia appi the tadard recoised o The principal portion of the lease payments have the date of iitia appicatio Apri ee discosed uder cash o fro aci Accordi the Copa has ot restated activities he ease paets for operati eases comparative information, instead, the cumulative as per d A eases ere earier reported effect of iitia appi this stadard has ee uder cash o fro operati activities recoised as a adustet to the opei he eihted averae icreeta orroi aace of retaied earis as o Apri rate of has ee appied to ease iaiities efer ote iicat accouti poicies recoised i the aace sheet at the date of – Leases in the Annual report of the Company for initial application. the ear eded arch for the poic as O appicatio of d A the ature of per d A expeses has chaed fro ease ret i previous Company as a lessee periods to depreciatio cost for the rihttouse Operating Lease: asset ad ace cost for iterest accrued o For transition, the Company has elected not to lease liability. app the reuireets of d A to eases he differece etee the future iiu ease hich are expiri ithi oths fro the rental commitments towards non-cancellable date of transition by class of asset and leases operati eases ad ace eases reported as at for hich the uderi asset is of o vaue o arch copared to the ease iaiit as a lease-by- lease basis. The Company has also accouted as at Apri is priari due to used the practical expedient provided by the inclusion of present value of the lease payments stadard he appi d A to eases for the cancellable term of the leases, reduction previous cassied as operati eases uder due to discouti of the ease iaiities as per d A ad therefore has ot reassessed the reuireet of d A ad excusio whether a contract, is or contains a lease, at the of the commitments for the leases to which date of initial application, relied on its assessment the Company has chosen to apply the practical of hether eases are oerous appi d expedient as per the standard. A iediate efore the date of iitia appicatio as a aterative to perfori a Finance lease impairment review, excluded initial direct costs he Copa has eases that ere cassied fro easuri the riht of use asset at the as ace eases appi d A or such date of iitia appicatio ad used hidsiht eases the carri aout of the rihtof he deterii the ease ter if the cotract use asset and the lease liability at the date of contains options to extend or terminate the lease. iitia appicatio of d A is the carri he Copa has used a sie discout rate to a amount of the lease asset and lease liability on portfolio of leases with similar characteristics. the trasitio date as easured appi d A

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

Accordi a aout of ` iio orrois to the extet the are rearded as a has ee recassied fro propert pat ad adjustment to the interest cost. euipet to rihtofuse assets A aout of ` orroi costs aocated to uaifi assets iio has ee recassied fro other curret pertaii to the period fro coeceet of acia iaiities to ease iaiit curret ad activities reati to costructiodeveopet an amount of ` iio has ee recassied of the uaifi asset up to the date of fro orrois o curret to ease iaiit capitalisation of such asset are added to the cost non-current. of the assets Capitaisatio of orroi costs is Impact of COVID-19 suspeded ad chared to the tateet of rot he Copa does ot foresee a arescae ad oss duri exteded periods he active contraction in demand which could result in deveopet activit o the uaifi assets is siicat do sii of its epoee ase interrupted. rederi the phsica ifrastructure redudat A other orroi costs are recoised as a The leases that the Company has entered with expense in the period which they are incurred. lessors towards properties used as delivery ceters saes offices are o ter i ature ad q) Government Grants: o chaes i ters of those eases are expected overet rats are iitia recoised at fair due to the CO value if there is reasonable assurance that they will be received and the Company will comply with o) Provisions and Contingent Liabilities: the coditios associated ith the rat A provisio is recoised he the Copa has a preset oiatio as a resut of past evets case of capita rats the are the ad it is proae that a outo of resources i recoised i tateet of rot ad oss as e reuired to sette the oiatio i respect of other income on a systematic basis over the hich a reiae estiate ca e ade f effect useful life of the asset. of the time value of money is material, provisions case of rats that copesate the are discouted usi a appropriate discout rate Copa for expeses icurred are recoised that reects he appropriate the riss specic i tateet of rot ad oss o a to the iaiit he discouti is used the systematic basis in the periods in which the icrease i the provisio due to the passae of expeses are recoised tie is recoised as a ace cost Export eets avaiae uder prevaet schees Cotiet iaiities are discosed i the are accrued i the ear i hich the oods are Notes to the Standalone Financial Statements. exported ad there is o ucertait i receivi Cotiet iaiities are discosed for the same. i possie oiatios hich i e cored r) Earnings per share: only by future events not wholly within the asic earis per share is coputed dividi control of the Company, or the prot after tax the eihted averae ii preset oiatios arisi fro past evets uer of euit shares outstadi duri the here it is ot proae that a outo ear he eihted averae uer of euit of resources i e reuired to sette the shares outstadi duri the ear is adusted oiatio or a reiae estiate of the aout for the events for bonus issue, bonus element in of the oiatio caot e ade a rihts issue to existi sharehoders share spit and reverse share split (consolidation of shares). p) Borrowing costs: iuted earis per share is coputed dividi orroi costs are iterest ad other costs the protoss after tax as adusted for divided that the Company incurs in connection with the iterest ad other chares to expese or icoe orroi of fuds ad is easured ith referece et of a attriutae taxes reati to the to the effective iterest rate E appicae diutive potetia euit shares the eihted to the respective orroi orroi costs averae uer of euit shares cosidered include interest costs measured at EIR and for derivi asic earis per share ad the exchae differeces arisi fro forei currec eihted averae uer of euit shares hich

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

could have been issued on conversion of all u) Segment reporting: diutive potetia euit shares he cacuatio The Company operates in one reportable business of diuted earis per share does ot assue seet ie haraceuticas conversion, exercise, or other issue of potential v) Operating cycle: ordinary shares that would have an antidilutive Based on the nature of products/activities of effect o earis per share the Company and the normal time between s) Insurance claims: acuisitio of assets ad their reaisatio i cash Insurance claims are accounted for on the basis or cash euivaets the Copa has deteried of claims admitted/expected to be admitted and its operati cce as oths for the purpose to the extent that the amount recoverable can be of cassicatio of its assets ad iaiities as measured reliably and it is reasonable to expect current and non-current as set out in Schedule III the ultimate collection. of the Act. t) Goods and Services tax input credit: 1C. RECEN T ACCOUNTING PRONOUNCE- oods ad ervices tax iput credit is accouted MENTS: for in the books in the period in which the he CA has ot otied a aedets hich uderi service received is accouted ad he are effective fro st Apri there is reasoae certait i avaiiutiisi the credits.

Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements - - - - - 28.4 45.6 84.8 743.1 119.2 As at As at 974.7 676.9 685.3 1,069.3 1,058.2 3 4 , 4 6 1 . 9 Net Block Net Block 31.03.2020 ( ` in million) ------865.9 - 4.4 22.0 35.2 24.4 24.4 38.8 46.3 161.9 101.3 613.8 3,057.5 419.3 419.3 166.9 258.2 166.9 105.5 337.6 145.0 93.7 100.5 As at As at 284.7 284.7 155.8 530.9 530.9 702.7 1,602.1 10,635.4 1,602.1 1,306.4 1,306.4 552.0 2,766.3 481.9 3,073.2 31.03.2020 31.03.2020 - 1.0 1.0 44.2 31.8 1.0 1.0 0.7 0.8 0.8 67.9 4.8 2,149.5 12,001.6 14.2 14.2 673.5 415.2 44.5 1,033.1 1,033.1 44.5 78.8 78.8 13,471.3 17,778.8 40.9 40.9 139.5 10,448.0 10,448.0 16,382.4 139.5 199.9 199.9 13,732.3 30,672.0 132.8 18,449.4 isposas isposas ------384.4 2,863.8 ------128.9 108.9 ------23.0 - 3.1 - 22.3 ------Loss Loss Impairment Impairment 11.1 11.1 9.8 10.1 10.8 10.8 317.1 68.7 68.7 30.5 44.5 117.8 117.8 34.0 105.5 296.3 308.5 308.5 period period Accumulated Depreciation Depreciation Accumulated Depreciation Accumulated For the For the For 3,870.9 3,870.9 ------24.4 - - - - - 4.4 - 419.3 - - 6 7. 3 23.0 23.0 24.4 96.9 98.4 769.1 128.9 166.9 166.9 As at As at 01.04.2019 01.04.2019 - - - - - 76.0 52.8 84.4 31.8 425.1 425.1 67.7 99.2 185.3 As at As at 974.7 974.7 238.7 100.5 44.5 263.2 440.5 440.5 3,671.3 262.6 392.1 1,104.6 1,104.6 1,104.5 35.2 3,750.1 613.8 337.6 2,122.8 1,233.6 1,233.6 415.2 138.0 14,151.1 14,151.1 1,602.1 552.2 1,858.4 1,033.1 3,248.2 384.4 259.1 2,122.8 31,250.1 31,250.1 10,448.0 3,102.1 31.03.2020 31.03.2020 - 1,104.5 - - - 237.8 - 865.9 - 443.1 - - - - 3.1 3.1 1.0 1.0 1.0 1.0 26.1 94.1 94.1 22.9 22.9 23.0 23.0 48.0 48.0 isposas isposas - - -- 5.6 4.4 8.2 11.5 63.1 79.8 26.4 367.1 367.1 322.4 Gross Block Gross Block Additions Additions ------26.4 26.4 71.4 71.4 89.1 89.1 99.5 1.5 187.1 76.0 76.0 44.6 44.6 174.7 425.1 425.1 15.4 706.1 706.1 398.5 185.3 53.4 237.8 861.5 233.3 - 997.0 107.5 107.5 997.0 As at As at 266.7 158.4 158.4 266.7 865.9 865.9 108.8 1,776.2 1,776.2 105.2 1,104.5 1,630.5 1,630.5 212.7 1,776.2 67.0 3,671.3 1,020.4 1,020.4 186.4 1,088.7 118.1 300.1 129.3 1,088.7 1,088.7 167.8 3,396.9 11,572.3 666.7 1.5 12,237.5 1,119.0 483.8 3,248.2 2,988.9 259.3 - 3,248.2 12,237.5 12,237.5 1,939.7 23,913.8 23,913.8 3,118.2 26,830.4 201.6 2,861.0 7,726.5 45,320.1 45,320.1 7,761.9 170.7 52,911.3 13,732.3 4,849.9 40,333.6 4,459.940,333.6 44,404.3 389.2 10,061.3 26,830.4 26,830.4 4,513.8 01.04.2019 01.04.2019 iio ocated at esearch ad eveopet ad eveopet at esearch ocated iio ` million (previous year areati ` 480.6 icude ites at ad Euipet ropert to Additios of the Company. Centers

` 1,000/-). (previous year societies of ` 1,000/- of shares i cooperative of uidis icudes cost Cost ures i each cass of assets curret ear i itaics eo ures are ive ear revious ote efer detais of pairet oss or ote asset efer detais of ihtofuse or Total Total easehod Office Euipets Office easehod Leasehold Vehicles Leasehold easehod uriture ixtures uriture easehod easehod at ad Euipet easehod easehod uidis easehod Right of use Assets Right Land Leasehold Office Euipet Office Vehicles Furniture and Fixtures Furniture Total at ad Euipet proveets o eased reises o eased proveets rihts ossiers areti Trademarks and Licences Trademarks uidis Freehold Land Freehold Software Computer Particulars Particulars a c d ures i each cass of assets curret ear i itaics eo ures are ive ear revious a 2. Property, Plant And Equipment Plant And Equipment 2. Property, 3. Intangible Assets - Acquired

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

4. Non-Current Investments efer ote (` in million) Number Face Value As at As at 31.03.2020 a. In Subsidiary Companies (at Cost) Unquoted i) Equity Instruments - Nanomi B.V., Netherlands 105,829 Euro forer o as upi Hodis (105,829) 1,000 upi haraceuticas c A 0.001 upi Austraia t td Austraia 800,000 A (800,000) * - Lupin Healthcare Ltd., India 2,616,677 ` 81.7 81.7 cudi shares hed oiees (2,616,677) 10 upi Atatis Hodis A iterad 2,486 CHF (2,486) 1,000 ii) Capital Contributions: - Nanomi B.V., Netherlands forer o as upi Hodis upi Atatis Hodis A iterad b. In Others i) In Equity Instruments (at Fair Value through Profit or Loss) Unquoted - Biotech Consortium India Ltd., India 50,000 ` 0.5 0.5 (50,000) 10 - Enviro Infrastructure Co. Ltd., India 100,000 ` 1.0 1.0 (100,000) 10 - Bharuch Enviro Infrastructure Ltd., India 4,410 ` ` ` (4,410) 10 - Narmada Clean Tech Ltd., India ` 11.0 11.0 10 arapur Eviroet rotectio ociet dia ` 7. 2 7. 2 100 19.7 19.7 ii) In Bonds/ Debentures /Securities (at Amortised Cost) - Government Bonds Unquoted atioa Hihas Authorit of dia dia - ` - (500) 10,000 - Non Convertible Debentures Quoted ata Capita iacia ervices td dia - ` - 508.0 (500) 1,000,000 Adita ira Housi iace td dia - ` - 521.5 (500) 1,000,000 ota ahidra rie td dia - ` - 509.1 (500) 1,000,000

240 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

(` in million) Number Face Value As at As at 31.03.2020 - Government Securities Unquoted atioa avi Certicates eposited ith overet Authorit ` ` - 19.7 Total 51,267.0 52,810.9

* Shares do not have face value i) All investments in shares are fully paid up ii) All the above subsidiaries are directly or indirectly, wholly owned by the Company iii) Areate aout of uoted ivestets ad aret vaue thereof Book value - Market value - iv) Areate aout of uuoted ivestets 51,267.0 v) revious ear uers are ithi racets eo curret ear uers

5. Non-Current Loans (` in million) As at As at 31.03.2020 secured cosidered ood ecurit eposits ith eated arties efer ote C Others 401.8 569.1 Loans to Employees 2.0 14.9 Total 447.2 627.4

here are o other ocurret oas hich have siicat icrease i credit ris

6. Other Non-Current Financial Assets (` in million) As at As at 31.03.2020 Earared a eposits aaist uaratees ad other coitets 9.7 Total 9.7 14.3

7. Other Non-Current Assets (` in million) As at As at 31.03.2020 Capital Advances 1,488.9 895.5 Advances other than Capital Advances ith overet Authorities raacCustos Excise duties receivae 416.0 repaid Expeses 20.6 24.6 Other Advaces - Total 2,158.9 1,459.9

Lupin Limited | Annual Report 2019-20 241 Notes Forming part of the Standalone Financial Statements

8. Inventories (` in million) As at As at 31.03.2020 Raw Materials 6,791.0 6,041.6 aci aterias oriproress 5,109.9 5,127.4 iished oods 5,722.0 5,718.4 Stock-in-Trade Consumable Stores and Spares oodsirasit - Raw Materials 758.9 aci aterias 16.4 - Stock-in-Trade - - Consumable Stores and Spares 21.0 Total 24,846.1 23,059.8

uri the ear the Copa recorded ivetor ritedos of ` iio previous ear ` iiohese adustets ere icuded i cost of ateria cosued ad chaes i ivetories

9. Current Investments (` in million) As at As at 31.03.2020 - Measured at Amortised Cost Quoted o Covertie eetures 7,568.1 2,047.0 Coercia apers - Unquoted Coercia apers - 2,284.9 - Measured at Fair Value through Profit or Loss Unquoted In Mutual Funds 16,741.9 Total 23,297.3 21,073.8

a Areate aout of uoted ivestets ad aret vaue thereof Book value 10,292.4 2,047.0 Market value 2,054.9 Areate aout of uoted vestets 19,026.8 c) Unrealised Loss on Mutual Fund Investments (net) as adjusted above - -

242 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

10. Trade Receivables (` in million) As at As at 31.03.2020 Unsecured Cosidered ood 115.9 - Credit Impaired ess Aoaces for credit osses 118.8 Total 36,163.3 37,243.2

here are o other trade receivaes hich have siicat icrease i credit ris efer ote C for iforatio aout credit ris ad aret ris of trade receivaes

Trade receivables include debts due from subsidiary companies ` iio ` iio efer ote C

11. Cash and Cash Equivalents (` in million) As at As at 31.03.2020 Cash ad Cash Euivaets as per d A tateet of Cash os Bank Balances Curret Accouts icudi oeitrasit 1,512.1 462.2 - In EEFC Account 46.9 eposit Accouts 10,005.9 - Cheues o had 106.0 55.4 Cash on hand 6.6 Total 11,680.2 559.4

12. Other Bank Balances (` in million) As at As at 31.03.2020 Earmarked Balances with Banks - Unpaid dividend accounts 54.6 eposits aaist uaratees ad other coitets 11.9 0.4 a eposits ith oriia aturit of ore tha oths ut ess tha oths - from the balance sheet date Total 1,379.1 55.0

13. Current Loans (Financial assets stated at cost) (` in million) As at As at 31.03.2020 secured cosidered ood ecurit eposits 198.7 Other oas icudes oas to epoees etc 25.4 Total 348.9 229.1 here are o other curret oas hich have siicat icrease i credit ris

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

14. Other Current Financial Assets (` in million) As at As at 31.03.2020 eceivaes fro eated arties efer ote C 150.8 141.8 ar to aret erivative Assets - 101.5 Export eets receivae 2,211.0 5,514.2 ith overet Authorities ACevatervice tax creditrefud receivae 508.8 Other Curret iacia Assets icudes terest receivaes etc 176.6 Total 3,245.8 6,304.8

15. Other Current Assets (` in million) As at As at 31.03.2020 Advances other than Capital Advances repaid Expeses 258.7 Advances to Employees 62.8 96.8 Advances to Vendors Cosidered ood 1,781.9 747.6 - Credit Impaired 76.4 44.1 791.7 ess pairet Aoaces for Credit paired 76.4 44.1 1,781.9 747.6 Export eets receivae 887.6 ith overet Authorities ACevatervice tax creditrefud receivae 4,269.1 Assets Recoverable From Customers 55.6 52.4 Total 7,422.4 6,318.0

16. Equity Share Capital a) Equity Share Capital articuars As at 31.03.2020 As at No. of Shares ` in million No. of Shares ` in million

Authorised Euit hares of ` 2 each 1,000,000,000 2,000.0 1,000,000,000 2,000.0 Issued, Subscribed and Paid up Euit hares of ` 2 each fully paid 452,998,121 906.0 905.0 Total 452,998,121 906.0 452,493,697 905.0 b) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting period articuars As at 31.03.2020 As at No. of Shares ` in million No. of Shares ` in million Euit hares outstadi at the eii of the ear 905.0 452,082,850 904.2 Euit hares issued duri the ear pursuat to exercise of EOs 504,424 1.0 410,847 0.8 Euit hares outstadi at the ed of the ear 452,998,121 906.0 905.0

244 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements c) Rights attached to Equity Shares he Copa has o oe cass of euit shares ith voti rihts havi a par vaue of ` per share The Company declares and pays dividends in Indian Rupees. The dividend proposed by the Board of irectors is suect to the approva of the sharehoders at the esui Aua eera eeti uri the ear eded arch the aout of divided per euit share distriuted to euit shareholders is ` previous ear eded arch ` the evet of iuidatio of the Copa the sharehoders of euit shares i e etited to receive reaii assets of the Copa after distriutio of a preferetia aouts he distriutio i e i proportio to the uer of euit shares hed the sharehoders d) Details of shares held by each shareholder holding more than 5% equity shares Name of Shareholder As at 31.03.2020 As at No. of Shares of Hodi No. of Shares of Hodi

upi vestets vt iited 45.44 e) Shares reserved for issuance under Stock Option Plans of the Company articuars As at 31.03.2020 As at No. of Shares ` in million No. of Shares ` in million upi Epoees toc Optio a 0.2 126,850 a 0.1 0.1 a 2.6 2.7 a 4.7 2,656,712 Lupin Subsidiary Companies Epoees toc Optios a - - 100,568 0.2 a 1.4 708,527 1.4 a 1,106,476 2.2 1,125,000 f) Aggregate number of shares issued during last five years pursuant to Stock Option Plans of the Company articuars As at As at 31.03.2020 Aggregate No. Areate o of Shares of Shares Euit hares issued uder various toc Optio as of the Copa g) o shares have ee aotted ithout paet ei received i cash or a of ous shares duri the period of ve ears iediate precedi the aace heet date

Lupin Limited | Annual Report 2019-20 245 Notes Forming part of the Standalone Financial Statements

1 7. Other Equity (` in million) As at As at 31.03.2020 Reserves and Surplus Capital Reserve Opei ad Cosi aace as per ast aace heet vestet usidies fro Cetra overet 1.0 1.0 vestet usidies fro tate overet 8.2 8.2 O restructuri of capita of the Copa uder the chee of Aaaatio 254.7 254.7 Capital Redemption Reserve Opei ad Cosi aace as per ast aace heet 126.5 126.5 Securities Premium Opei aace as per ast aace heet 8,129.5 Add Additios duri the ear 514.8 Balance as at the year end 9,175.5 Employees Stock Options Outstanding [Refer note 44] Opei aace as per ast aace heet 2,184.2 Add Aortisatio duri the ear 617.2 ess Exercised duri the ear 472.5 478.6 ess rasfer to eera eserve 98.4 68.2 Balance as at the year end 2,146.2 2,184.2 General Reserve Opei aace as per ast aace heet 16,668.7 16,600.5 Add rasfer fro share ased paets 98.4 68.2 Balance as at the year end 16,767.1 16,668.7 Retained Earnings Opei aace as per ast aace heet 129,610.6 ess Adustet for trasitio to d A eases et off deferred tax 86.9 - efer ote iv ess Adustet for trasitio to Appedex C of d A coe axes 804.5 - efer ote d Add rot for the ear 7,275.5 ess ia ivided o Euit hares efer ote c 2,260.8 ess Corporate ax o ivided 465.2 464.7 Balance as at the year end Amalgamation Reserve Opei ad Cosi aace as per ast aace heet Share Application money Pending allotment 0.8 - Other Comprehensive Income Cash Flow Hedge Reserve [Refer note 54 (c)] Opei aace as per ast aace heet 77.5 60.6 Add ess Effect of forei exchae rate variatios o hedi (404.4) 15.7 istruets outstadi et of deferred tax of ` (157.7) million ` iio ess Add Hede effectiveess recoised i tateet of rot oss 2.5 1.2 Balance as at the year end 77.5 Actuarial Gain / (Loss) Opei aace as per ast aace heet (288.7) (277.9) Add ess Additios duri the ear (288.1) (10.8) Balance as at the year end (576.8) (288.7) Total 173,826.0 170,267.7

epresets aout received o aotet of previous ear Euit hares of the face vaue of ` 2 each, pursuant to upi Epoees toc Optio as efer ote

epresets Corporate ax o ia ivided ` 465.1 million (previous year ` 464.6 million) and on dividend paid for previous year on Euit hares issued after ear ed pursuat to EOs aotet ` 0.1 million (previous year ` 0.1 million).

246 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

Nature of Reserves between erstwhile Lupin Laboratories Ltd. and the Company. a) Capital Reserve The Capital reserve is created on receipts of f) Cash Flow Hedge Reserve overet rats for setti up the factories i he cash o hede reserve represets the acard areas for perfori research o critica cuuative effective portio of ais or osses medicines for the betterment of the society and arisi o chaes i fair vaue of desiated o restructuri of the Capita of the Copa portio of hedi istruets etered ito for uder various schees of Aaatio Cash o hedes he cuuative ai or oss arisi o chaes i fair vaue of the desiated b) Capital Redemption Reserve portio of the hedi istruets that are This reserve represents redemption of redeemable recoised ad accuuated uder the headi of cumulative preference shares in earlier years. cash o reserve i e recassed to stateet c) Securities Premium of prot ad oss o he the heded ites Securities premium account comprises of premium affect the prot or oss on issue of shares. The reserve is utilised in g) Employees Stock Options Outstanding accordace ith the specic provisio of the The Company has employee stock option schemes Copaies Act under which the option to subscribe for the d) General Reserve Copas shares have ee rated to certai he eera reserve is used fro tie to tie epoees ad directors his is used to recoie to trasfer prots fro retaied earis for the vaue of euitsetted shareased paets appropriatio purposes As the eera reserve provided to the employees as part of their is created by a transfer from one component remuneration. of euit to aother ad is ot a ite of other h) Share Application money Pending allotment comprehensive income. Share application money represents amount e) Amalgamation Reserve received towards share application money which were his reserve represets creatio of aaaatio pedi for aotet as o reporti date reserve pursuat to the schee of aaaatio

18. Non- Current Borrowings efer ote (` in million) As at As at 31.03.2020 Term Loans - from other parties Unsecured eferred aes ax oa fro overet of aharashtra Total 3.1 5.3 a eferred aes ax oa is iterest free ad paae i aua istaets after expir of iitia ears oratoriu period fro each such ear of deferra period eii fro to ad edi fro to he Copa has ot defauted o repaet of oas ad iterest duri the ear

19. Trade Payables (` in million) As at As at 31.03.2020 ota outstadi dues of icro ad a Eterprises efer ote - - ota outstadi dues of Others - 16.1 Total - 16.1

Lupin Limited | Annual Report 2019-20 247 Notes Forming part of the Standalone Financial Statements

20. Other Non-Current Financial Liabilities (` in million) As at As at 31.03.2020 ar to aret erivative iaiities - aae for Capita Expediture - Epoee eets aaes 42.9 ease iaiit efer ote 859.1 - Other aaes - Total 1,195.9 149.6

21. Non- Current Provisions (` in million) As at As at 31.03.2020 rovisios for Epoee eets efer ote ratuit efer ote ii A Compensated Absences 946.4 779.1 rovidet ud 66.8 - Total 2,726.3 2,094.6

22. Other Non-Current Liabilities (` in million) As at As at 31.03.2020 eferred eveue efer ote 586.6 827.7 eferred overet rat - Total 660.4 827.7

23. Current Borrowings (` in million) As at As at 31.03.2020 Secured Loans from Banks 52.9 16.8 Total 52.9 16.8 a oas coprise of Cash Credit ad ori Capita ead oa ad are secured hpothecatio of ivetories ad oo dets carri iterest rate at C pus aret drive aris he Copa has ot defauted o repaet of oas ad iterest duri the ear

24. Trade Payables (` in million) As at As at 31.03.2020 Acceptances 827.4 Other tha Acceptaces ota outstadi dues of icro ad a Eterprises efer ote 989.4 1,046.1 ota outstadi dues of Others 10,458.8 Total 15,661.3 12,540.2

248 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

25. Other Current Financial Liabilities (` in million) As at As at 31.03.2020 Curret aturities of oCurret orrois efer ote eferred aes ax oa fro overet of aharashtra 4.6 er oas fro Couci of cietic ad dustria esearch C - terest Accrued ut ot due o orrois - 0.1 paid ivided 54.6 ar to aret erivative iaiities - aae for Capita Expediture rade eposits received 106.8 126.1 Epoee eets aaes 1,247.2 1,009.7 ease iaiit efer ote 567.5 - Other aaes cudes retetio oe etc 0.7 7.0 Total 2,747.1 1,577.2 uri the ear ` iio has ee credited to vestor Educatio ad rotectio ud reati to

26. Other Current Liabilities (` in million) As at As at 31.03.2020 tatutor ues aaes icudes rovidet ud ithhodi axes etc eferred eveue efer ote 128.1 eferred overet rat 54.7 - Advances from customers Total 1,194.9 869.8

2 7. Current Provisions (` in million) As at As at 31.03.2020 rovisios for Epoee eets efer ote ratuit efer ote ii A 278.0 Compensated Absences 166.0

Other rovisios or aes eturs efer ote a 1,420.8 1,195.6 or Europea Coissio e efer ote Total 5,515.6 4,903.8

Lupin Limited | Annual Report 2019-20 249 Notes Forming part of the Standalone Financial Statements

28. Revenue from Operations (` in million) For the Current or the revious Year ended Year ended 31.03.2020

ae efer ote oods 106,290.6 Research Services 1,767.7 Other Operati eveue Export eets ad Other cetives 2,086.2 2,506.6 Insurance Claims 17.4 Business Compensation and Settlement Income 4.0 677.8 Miscellaneous Income 68.4 45.8 Total 110,256.6 113,563.2

29. Other Income (` in million) For the Current or the revious Year ended Year ended 31.03.2020

Income on Financial Assets carried at amortised cost terest o eposits ith as 80.2 Other terest 874.1 coe o iacia Assets carried at fair vaue throuh prot or oss ivided o utua ud vestets 145.6 420.9 et ai o ae of utua ud vestets 1,062.8 122.4 reaised ai o utua ud vestets et 2.4 120.5 et ai o orei Currec rasactios 2,189.5 rot o ae of ropert at ad Euipettaie Assets et - 17.7 Other oOperati coe icudi iterest o icoe tax refud Total 4,751.9 2,913.4

30. Cost of Materials Consumed (` in million) For the Current or the revious Year ended Year ended 31.03.2020

Raw Materials Consumed aci aterias Cosued Total 27,532.2 26,930.8

250 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

31. Changes In Inventories Of Finished Goods, Work-In-Progress And Stock-In-Trade [(Increase)/Decrease] (` in million) For the Current or the revious Year ended Year ended 31.03.2020

Opei toc iished oods 5,718.4 5,104.9 Stock-in-Trade oriroress 5,127.4 4,519.7 14,145.1 12,672.8 ess Cosi toc iished oods 5,722.0 5,718.4 Stock-in-Trade oriroress 5,109.9 5,127.4 14,145.1 Chaes vetories iished oods Stock-in-Trade (251.1) orirocess 17.5 (607.7) Total (287.2) (1,472.3)

32. Employee Benefits Expense (` in million) For the Current or the revious Year ended Year ended 31.03.2020

aaries ad aes 12,672.4 Cotriutio to rovidet ad Other uds 1,121.9 etireet eets Expese 44.7 115.9 hare ased aets Expese efer ote 477.0 taff efare Expeses 846.0 844.6 Total 17,032.2 15,154.2

33. Finance Costs (` in million) For the Current or the revious Year ended Year ended 31.03.2020

terest o iacia iaiities orroi carried at aortised cost 77.9 89.5 et terest o et deed eet iaiit 184.9 190.7 terest cost o iace ease oiatio 8.5 Other orroi Costs icudes a chares etc 65.1 66.0 Interest on Income Tax - Total 525.9 354.7

Lupin Limited | Annual Report 2019-20 251 Notes Forming part of the Standalone Financial Statements

34. Other Expenses (` in million) For the Current or the revious Year ended Year ended 31.03.2020

rocessi Chares 1,129.7 Stores and Spares Consumed epairs ad aiteace uidis 285.5 246.1 at ad achier 1,092.9 Others 1,169.5 et ad Other Hire Chares efer ote 514.2 1,119.2 Rates and Taxes 1,095.5 1,112.1 Insurance 565.7 oer ad ue 4,162.6 Cotract aour Chares 1,124.7 ei ad rootio Expeses Coissio ad roerae 911.8 854.0 reiht ad orardi 557.4 495.7 ostae ad eephoe Expeses 257.1 268.2 ravei ad Coveace 1,940.5 2,161.4 ea ad rofessioa Chares 5,819.7 et of recoveries of ` nil (previous year ` iio oatios 45.6 41.7 Ciica ad Aatica Chares 1,845.8 oss o ae riteoff of ropert at ad Euipet taie Assets et 17.6 - ad rade eceivaes Advaces ritte off - et of provisio of earier ears adusted ` 20.6 million (previous year ` iio pairet Aoaces for outfu rade eceivaes Advaces et 69.4 69.5 Impairment in value of Non-Current investments - Corporate ocia esposiiit Expeses efer ote irectors itti ees 2.1 1.4 Business Compensation and Settlement Expenses 80.9 160.7 Miscellaneous Expenses 716.6 Total 32,075.6 30,952.2

35. Commitments: a Estiated aout of cotracts reaii to e executed o capita accout ad ot provided for et of advances, ` iio previous ear ` iio b) Letter of comfort for support in respect of its subsidiaries. The Company considers its investments in susidiaries as strateic ad oter i ature he Copa is coitted to operatioa techica ad acia support the operatios of its susidiaries c Other coitets ocaceae eases efer ote

d ivideds proposed of ` previous ear ` per euit share efore the acia stateets approved for issue ut ot recoised as a iaiit i the acia stateets is ` iio previous ear ` iio

e here are product supp coitets pursuat to cotracts ith custoers uder dossier areeets f iacia ad corporate uaratees issued the copa o ehaf of susidiaries are discosed i ote

252 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

36. Contingent Liabilities: (` in million) articuars As at As at 31.03.2020 a) Income tax demands/matters on account of deductions / allowances in earlier 2028.4 1818.5 ears pedi i appeas ad potetia tax deads i future ears i respect of soe ucertai tax issues ` iio previous ear ` iio coseuet to departet preferri appeas aaist the order of the Appeate Authorit passed i favour of the copa Aout paid there aaist ad icuded uder Curret ax Assets et ` Nil (previous year ` Nil million) and “Non-Current Tax Assets (Net)“ ` iio (previous year ` iio b) Custos ut Excise dut ervice tax ad aes tax deads for iput tax 122.2 191.2 credit disaoaces ad dead for additioa Etr ax arisi fro dispute o appicae rate are i appeas ad pedi decisios Aout paid there aaist ad icuded uder ote Other oCurret Assets ` 24.2 million (previous year ` iio c) Cais aaist the Copa ot acoeded as dets excudi iterest aout uascertaied i respect of a cai for trasfer chares of ad octroi dut oca od tax epoee cais poer tradears prici ad stap dut Aout paid there aaist ithout aditti iaiit ad icuded uder ote Other oCurret Assets ` 206.5 million (previous year in Current Loans ` 115.1 million). ead raised aharashtra tate Eectricit eveopet Corporatio iited EC chaei roup Captive eerati at C status of poer suppiers at at arapur ad ue ocatio d) Letter of comfort issued by the Company towards the credit facilities sanctioned 7566.5 5186.6 the aers of susidiar copaies areati ` 7566.5 million (previous year ` 5186.6 million). e) Outstadi credit faciities aaist corporate uaratees ive i respect of 54777.1 credit facilities sanctioned by bankers of subsidiary companies for the purpose of acuisitios ori capita ad other usiess reuireets areati ` iio previous ear ` 84728.2 million). f) iacia uaratee areati to ` iio previous ear ` 8575.2 million) - - ive to third part o ehaf of susidiaries for cotractua oiatios he Hoe upree Court of dia C their order dated eruar i the case of ura oshi iited others vs EO set out the pricipes ased o hich aoaces paid to the epoees shoud e idetied for icusio i asic aes for the purposes of coputatio of rovidet ud cotriutio useuet a revie petitio aaist this decisio has ee ed hich is o disissed vie of the aaeet the iaiit for the period fro date of the C order to arch is ot siicat uture cash outos i respect of the aove if a is deteriae o o receipt of udeet decisios pedi ith the reevat authorities he Copa does ot expect the outcoe of the atters stated aove to have a ateria adverse ipact o the Copas acia coditio resuts of operatios or cash os he Copa does ot evisae a ie reiurseets i respect of the aove he Copa is ivoved i various ea proceedis icudi product iaiit reated cais epoet cais ad other reuator atters reati to coduct of its usiess he Copa carries product iaiit isurace poic ith a aout it eieves is sufficiet for its eeds respect of other cais ad the Copa eieves that the proaiit of outo is o to oderate cosideri the erits of the case the utiate dispositio of these atters a ot have ateria adverse effect o its iacia Statements. 3 7. he Copa hods euit shares uuoted of ai ardha oer td dia at a cost of ` iio hich as fu ipaired the Copa duri the previous ear

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

38. Expeses icurred prior to coeceet of coercia productio icuded i Capita orroress represet direct attriutae expediture for setti up of pats he sae i e capitaised o copetio of proects ad coeceet of coercia operatios he detais of preoperative expeses are (` in million) articuars 2019-2020 2018-2019 Opei aace 4 07. 5 427.4 curred duri the ear Salaries, allowances and contribution to funds 109.5 97.1 ea ad rofessioa Chares 0.5 0.1 ravei ad Coveace 8.9 10.2 oer ad fue 0.6 Others 11.8 28.2 ota icurred duri the ear ess Capitaised duri the ear 146.0 190.2 Closing balance 392.8 4 07. 5

39. Revenue (Ind AS 115) a) he operatios of the Copa are iited to o oe seet vi pharaceuticas ad reated products eveue fro cotract ith custoers is fro sae of aufactured oods ad rederi of research services ae of oods are ade at a poit i tie ad reveue is recoised upo satisfactio of the perforace oiatios hich is tpica upo dispatch deiver he Copa has a credit evauatio poic ased o hich the credit iits for the trade receivaes are estaished here is o siicat aci copoet as the credit period provided the Copa is ot siicat coe fro research services icudi sae of techoo oho rihts iceses ad other itaies is recoised i accordace ith the ters of the cotract ith custoers he the reated perforace oiatio is copeted or he riss ad reards of oership are trasferred as appicae he Copa eters ito certai dossier saes icesi ad supp arraeets that i certai istaces icude certai perforace oiatios ased o a evauatio of hether or ot these oiatios are icoseuetia or perfuctor the Copa recoise or defer the upfrot paets received uder these arraeets ariae copoets such as discouts chareacs reates saes returs etc cotiues to e recoised as deductios fro reveue i copiace ith d A

254 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements b) Disaggregation of revenue: (` in million) ature of seet 2019-2020 2018-2019 A. Major Product/Service line: ae of pharaceutica oods 106290.6 coe fro research services ad sae of s 1767.7 usiess Copesatio etteet icoe 4.0 677.8 Total revenue from contracts with customers B. Primary geographical market: - India 56454.1 51675.8 - USA apa 950.1 Others 19449.8 17025.8 Total revenue from contracts with customers C. Timing of the revenue recognition: oodservices trasferred at a poit i tie - Services transferred over time Total revenue from contracts with customers c) Reconciliation of revenue as per contract price and as recognised in statement of profit and loss: (` in million) articuars 2019-2020 2018-2019 Revenue as per contracted price 116572.1 118487.1 Adusted for - Sales returns 2100.2 iscouts Chareacs eates 5979.8 Others 429.0 427.1 Total revenue from contracts with customers 108062.3 110993.4 d) Reconciliation of revenue recognised from Contract liability: (` in million) articuars 2019-2020 2018-2019 aace i cotract iaiit at the eii of the period that as ot recoied as 955.8 956.2 revenue Add creases due to cash received duri the ear excudi aouts recoied as 22.8 294.8 reveue duri the ear ess eveue recoied that as icuded i the cotract iaiit aace at the 268.9 eii of the period aace i cotract iaiit at the ed of the period that is ot recoied as reveue 709.7 955.8

40. Segment Reporting: he Copa has preseted data reati to its seets ased o its cosoidated acia stateets hich are preseted i the sae Aua eport Accordi i ters of pararaph of the dia Accouti tadard d A Operati eets o discosures reated to seets are preseted i these stadaoe acia stateets

Lupin Limited | Annual Report 2019-20 255 Notes Forming part of the Standalone Financial Statements

41. Auditors’ Remuneration: (` in million) articuars 2019-2020 2018-2019

aet to Auditors a) As Auditors 14.6 14.5 or other services icudi Certicatio 10.5 5.0 c) Reimbursement of out-of-pocket expenses 1.2 Total 26.3 20.8

Excudi ad achh harat Cess

42. Leases: he Copa eases office euipet vehices furiture xtures pat euipet ad office preises he eases tpica ru for the period etee oths to oths revious these eases ere cassied as operati eases uder d A he Copa had easehod ad hich as cassied as ace ease uder d A foratio aout eases for hich the Copa is essee is preseted eo i) Right of use assets (` in million) articuars As at 01.04.2019 Carrying amount of: ihtofse ad ihtofse uidis 706.1 ihtofse at Euipet - ihtofse uriture ixtures 76.0 ihtofse ehices 89.1 ihtofse Office Euipet 44.6 Total 1985.1

(` in million) Particulars Right-of- Right-of-Use: Right-of- Right-of-Use: Right-of- Right-of- Total Use: Land Buildings Use: Plant & Furniture & Use: Vehicles Use: Office Equipment Fixtures Equipment Cost Balance at April 1, 2019 - 2020.3 Additions - 899.7 isposa erecoied - - - - - 1.5 duri the ear Balance at March 31, 2020 2918.5 Accumulated depreciation Balance at April 1, 2019 - - - - - 35.2 epreciatio expese 633.4 isposa erecoied - - - - - (0.8) duri the ear Balance at March 31, 2020 667.8 Balance at March 31, 2020 2250.7 Balance at April 1, 2019 - 1985.1

256 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

Lease liabilities (` in million) Particulars Right-of- Right-of-Use: Right-of- Right-of-Use: Right-of- Right-of- Total Use: Land Buildings Use: Plant & Furniture & Use: Vehicles Use: Office Equipment Fixtures Equipment Balance at April 1, 2019 - Addition - 899.7 Accreditation of interest 138.7 aets (805.0) Adustets for isposas - - - - - (0.6) Balance at March 31, 2020 1426.6 Current 567.5 Non-current 859.1 he aturit aasis of the ease iaiit is icuded i the efer ote o ii iacia ris aaeet oectives ad poicies uder aturities of acia iaiities

Amounts recognised in Statement of Profit and Loss (` in million) articuars As at 31.3.2020 epreciatio expese of rihtofuse assets efer ote o terest expese o ease iaiities efer ote o Expese reati to shortter eases efer ote o Expese reati to o vaue assets efer ote o Total 919.7 ii) Financial risk management (A) Maturities of financial liabilities he tae eo aae the Copas acia iaiities ito reevat aturit aasis ased o their cotractua aturities for a acia iaiities he aouts discosed i the tae are the cotractua udiscouted cash os (` in million) Contractual maturities of financial liabilities Less than 1 Year More than 1 Year Total As at March 31, 2020 Lease liabilities iii) Commitments and contingencies he Copa has ot etered ito ease cotracts that have ot et coeced as at arch Commitment in respect of Non-cancellable short term leases is ` iio Commitment in respect of low value leases is ` iio iv) Changes in accounting policies and disclosures New and amended standards and interpretations d A as otied ith effect fro Apri hich repaces d A d A sets out the pricipes for the recoitio easureet presetatio ad discosure of eases ad reuires essees to recoise ost eases o the aace sheet essor accouti uder d A is sustatia uchaed fro d A essors i cotiue to cassif eases as either operati or ace eases usi siiar pricipes as i d A herefore d A did ot have a ipact for eases here the Copa is the essor

he Copa adopted d A usi the odied retrospective ethod of adoptio ith the date of iitia appicatio of Apri der this ethod the stadard is appied retrospective ith the cuuative effect of iitia appi the stadard recoised at the date of iitia appicatio

Lupin Limited | Annual Report 2019-20 257 Notes Forming part of the Standalone Financial Statements

he effect of adoptio d A as at Apri icreasedecrease is as foos

(` in million) Assets Amount ihtofuse assets 915.8 eferred ax Assets 46.7 Total assets 962.5

(` in million) Liabilities Amount Financial liabilities - Lease liabilities 1085.1 ease Euaiatio iaiit Total liabilities 1049.4

(` in million) Total adjustment on equity Amount etaied earis 86.9 ocotroi iterests - Total 86.9

As at the date of itia appicatio of d A ie Apri iht of se assets ad ease iaiities ere easured at iio ad iio respective he differece etee iht of use assets ao ith ease euaiatio iaiit ad ease iaiities as recoised i etaied earis eferred ax Asset of iio as recoied o etaied earis

v) The lease liabilities as at April 1, 2019 can be reconciled to the operating lease commitments as of March 31, 2019 is as follows:

(` in million) articuars As at 01.04.2019 Assets Operati ease coitets as at arch 1748.0 iscouted operati ease coitets as at Apri 1085.1 iace ease iaiities recoised as at arch 108.7 Less: Coitets reati to shortter eases - Add: ease paets reati to reea periods ot icuded i operati ease coitets as at arch - Lease liabilities as at April 1, 2019 1193.8 eihted averae icreeta orroi rate as at Apri is

258 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

43. Basic and Diluted Earnings per Share is calculated as under: (` in million) articuars Year ended Year ended 31.03.2020 rot attriutae to Euit harehoders ` in million) 7275.5 eihted averae uer of Euit hares - Basic 452244908 Add Effect of diutive issue of epoees stoc optios EOs coverted duri the 1871725 ear ad EOs outstadi as at the ear ed iuted Earis per hare i `) - Basic 16.07 iuted 15.99

44. Share-based payment arrangements: Employee stock options – equity settled he Copa ipeeted upi Epoees toc Optio a EO upi Epoees toc Optio a EO upi usidiar Copaies Epoees toc Optio a EO upi Epoees toc Optio a EO upi usidiar Copaies Epoees toc Optio a EO upi Epoees toc Optio a EO ad upi usidiar Copaies Epoees toc Optio a EO i earier ears as approved the Shareholders of the Company and the Remuneration / Compensation / Nomination and Remuneration Coittee of the oard of irectors the Coittee he Coittee deteries hich eiie epoees i receive optios the uer of optios to e rated the vesti period ad the exercise period he optios are rated at a exercise price hich is i accordace ith the reevat E uideies i force at the tie of such rats Each optio etites the hoder to exercise the riht to app for ad see aotet of oe euit share of ` each he optios issued uder the aove schemes vest in a phased manner after completion of the minimum period of one year with an exercise period of te ears fro the respective rat dates

Category A - Fair Market Value Options (comprising of options granted under ESOP 2003 ESOP 2005 SESOP 2005 ESOP 2011 SESOP 2011 ESOP 2014 and SESOP 2014) Current Year articuars hares arisi ae of eihted eihted out of options exercise averae exercise averae reaii (Nos.) prices (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear 2719654 1124.7 5.5 Add Optios rated duri the ear 40000 701.2-809.4 ess Optios apsed duri the ear 241928 217.8-1521.7 1218.0 NA ess Optios exercised duri the ear 149446 217.8-556.0 NA Optios outstadi at the ear ed 1155.1 4.7 Exercisable at the end of the period 4.5

revious ear articuars hares arisi ae of eihted eihted out of options exercise averae exercise averae reaii (Nos.) prices (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear 1119.1 6.4 Add Optios rated duri the ear - - - - ess Optios apsed duri the ear 280.8-1521.7 NA ess Optios exercised duri the ear 92114 NA Optios outstadi at the ear ed 2719654 1124.7 5.5 Exercisable at the end of the period 1060.2 5.1

Lupin Limited | Annual Report 2019-20 259 Notes Forming part of the Standalone Financial Statements

he eihted averae rat date fair vaue of the optios rated uder Cateor A duri the ears eded arch ad as ` ad ` nil per option, respectively.

Category B - Par Value Options (comprising of options granted under ESOP 2014) Current Year articuars hares arisi ae of eihted eihted out of options exercise averae exercise averae reaii (Nos.) prices (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear 1762924 2.0 2.0 8.6 Add Optios rated duri the ear 2.0 2.0 9.6 ess Optios apsed duri the ear 2.0 2.0 NA ess Optios exercised duri the ear 2.0 2.0 NA Optios outstadi at the ear ed 2054151 2.0 2.0 7.8 Exercisable at the end of the period 2.0 2.0 7. 2

revious ear articuars hares arisi ae of eihted eihted out of options exercise averae exercise averae reaii (Nos.) prices (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear 2.0 2.0 8.7 Add Optios rated duri the ear 876156 2.0 2.0 9.5 ess Optios apsed duri the ear 2.0 2.0 NA ess Optios exercised duri the ear 2.0 2.0 NA Optios outstadi at the ear ed 1762924 2.0 2.0 8.6 Exercisable at the end of the period 2.0 2.0

he eihted averae rat date fair vaue of the optios rated uder Cateor duri the ears eded arch ad as ` ad ` per optio respective

Category C - Discounted Fair Market Value Options (comprising of options granted under ESOP 2003 ESOP 2005 and ESOP 2011) Current Year articuars hares arisi ae of eihted eihted out of options exercise averae exercise averae reaii (Nos.) prices (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear 200000 415.7-891.5 688.1 7.1 Add Optios rated duri the ear - - - - ess Optios apsed duri the ear - - - NA ess Optios exercised duri the ear - - - NA Optios outstadi at the ear ed 200000 415.7-891.5 688.1 6.1 Exercisable at the end of the period 200000 415.7-891.5 688.1 6.1

revious ear articuars hares arisi ae of eihted eihted out of options exercise averae exercise averae reaii (Nos.) prices (`) price (`) contractual life (Yrs) Optios outstadi at the eii of the ear 200000 415.7-891.5 688.1 8.1 Add Optios rated duri the ear - - - - ess Optios apsed duri the ear - - - NA ess Optios exercised duri the ear - - - NA Optios outstadi at the ear ed 200000 415.7-891.5 688.1 7.1 Exercisable at the end of the period 200000 415.7-891.5 688.1 7.1 he eihted averae rat date fair vaue of optios rated uder Cateor C duri the ears eded arch ad as ` nil and ` nil per option, respectively.

260 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

he eihted averae share price duri the ears eded arch ad as ` ad ` per share respectively. Valuation of stock options he fair vaue of stoc optios rated duri the period has ee easured usi the acchoes optio prici ode at the date of the rat he acchoes optio prici ode icudes assuptios reardi dividend yields, expected volatility, expected terms and risk free interest rates. The key inputs and assumptions used are as foos Share price: he cosi price o E as o the date of rat has ee cosidered for vaui the optios rated Exercise Price: Exercise rice is the aret price or face vaue or such other price as deteried the Remuneration and Compensation Committee. Expected Volatility: he historica voatiit of the stoc ti the date of rat has ee cosidered to cacuate the fair value of the options. Expected Option Life: Expected Life of option is the period for which the Company expects the options to be live. The minimum life of a stock option is the minimum period before which the options cannot be exercised and the maximum life is the period after which the options cannot be exercised. Expected dividends: Expected divided ied has ee cacuated as a averae of divided ieds for four ears precedi the date of the rat Risk free interest rate: he ris free iterest rate o the date of rat cosidered for the cacuatio is the iterest rate appicae for a aturit eua to the expected ife of the optios ased o the ero coupo ied curve for overet ecurities hese assuptios reect aaeets est estiates ut these assuptios ivove iheret aret ucertaities ased o aret coditios eera outside of the Copas cotro As a resut if other assumptions had been used in the current period, stock-based compensation expense could have been ateria ipacted urther if aaeet uses differet assuptios i future periods stoc ased compensation expense could be materially impacted in future years. The estimated fair value of stock options is chared to icoe o a straihtie asis over the reuisite service period for each separate vesti portio of the award as if the award was, in-substance, multiple awards.

Lupin Limited | Annual Report 2019-20 261 Notes Forming part of the Standalone Financial Statements

he eihted averae iputs used i coputi the fair vaue of optios rated ere as foos

Weighted average information 2019-2020 Cateor rat date Exercise Risk free Expected Expected ivided eihted eihted price rate life (years) Volatility ied averae Optio share Fair Value price A April 12, 2019 809.4 2.0 B May 27, 2019 2.0 2.7 B u 2.0 764.8 749.4 B u 2.0 764.8 749.4 A Octoer 701.2 686.5 169.9 B November 6, 2019 2.0 771.5 755.9 B eceer 2.0 791.9 776.0 B eceer 2.0 791.9 776.0 B eceer 2.0 2.7 791.9 B eruar 2.0 708.7 B eruar 2.0 708.7 B eruar 2.0 2.7 708.7 697. 2

Cateor eihted Averae Optio air aue eihted Averae hare rice A 157.7 759.6 B 756.4 771.4

Weighted average information 2018-2019 Cateor rat date Exercise Risk free Expected Expected ivided eihted eihted price rate life (years) Volatility ied averae Optio share Fair Value price B April 2, 2018 2.0 7.0 28.9 0.5 777.1 764.6 B Apri 2.0 7. 5 46.6 0.5 811.6 796.2 B Apri 2.0 7. 5 46.6 0.5 811.6 796.2 B Auust 2.0 7.7 29.0 0.5 886.4 B Auust 2.0 7.7 29.0 0.5 886.4 B epteer 2.0 7.8 28.9 0.5 918.7 B September 26, 2018 2.0 8.0 29.1 0.5 891.8 875.1 B September 26, 2018 2.0 8.0 29.1 0.5 891.8 875.1 B November 28, 2018 2.0 7. 4 29.2 0.5 866.6 856.5 B November 28, 2018 2.0 2.7 29.9 0.5 866.6 B November 28, 2018 2.0 7. 4 29.2 0.5 866.6 856.5 B auar 2.0 7.1 0.5 818.7 B auar 2.0 7.0 2.7 29.5 0.5 B auar 2.0 7.0 2.7 29.5 0.5 B auar 2.0 7.1 0.5 818.7 B February 26, 2019 2.0 7.0 29.1 0.5 776.1 762.9 B February 26, 2019 2.0 7.0 29.1 0.5 776.1 762.9

Cateor eihted Averae Optio air aue eihted Averae hare rice B 828.8

262 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

45. Post-Employment Benefits: (i) Defined Contribution Plans: he Copa aes cotriutios toards providet fud ad superauatio fud to a deed cotriutio retireet eet pa for uaifi epoees he superauatio fud is adiistered the ife surace Corporatio of dia C der the pa the Copa is reuired to cotriute a specied percetae of paro cost to the retireet eet pa to fud the eets he Copa recoised ` iio previous ear ` iio for superauatio cotriutio ad ` iio previous ear ` iio for providet ad pesio fud cotriutios i the tateet of rot ad oss

(ii) Defined Benefit Plan: A he Copa aes aua cotriutios to the roup ratuit cu ife Assurace chees adiistered the C a fuded deed eet pa for uaifi epoees he schee provides for paet as uder a O ora retireetear retireetithdraaresiatio As per the provisios of the aet of ratuit Act ith vesti period of ears of service O death i service As per the provisios of the aet of ratuit Act ithout a vesti period additio to the aove etioed schee the Copa aso pas additioa ratuit as a exratia and the said amount is provided as non-funded liability based on actuarial valuation. he ost recet actuaria vauatio of pa assets ad the preset vaue of the deed eet oiatio for ratuit ere carried out as at arch he preset vaue of the deed eet oiatios ad the reated curret service cost ad past service cost ere easured usi the roected it Credit ethod ased o the actuaria vauatio otaied i this respect the fooi tae sets out the status of the ratuit pa ad the aouts recoised i the Copas acia stateets as at the aace Sheet date.

(` in million) Sr. articuars ratuit uded ratuit fuded No. As at As at As at As at 31.03.2020 31.03.2020 I) Reconciliation in present value of obligations (‘PVO’) defined benefit obligation: Current service cost 160.5 101.8 85.4 ast service cost - - - - Interest cost 88.1 81.6 Actuaria oss ai ue to deoraphic assuptio (0.5) - 0.9 - ue to ace assuptio 202.9 85.2 122.7 68.6 ue to experiece assuptio 20.7 18.4 (141.4) eets paid (198.2) (77.2) - O at the eii of the ear 1771.7 1047.1 O at the ed of the ear 2190.4 1771.7 II) Change in fair value of plan assets: Expected return on plan assets 2.5 - - Interest Income 1 07. 2 79.9 - - Contributions by the employer 468.8 - - eets paid (198.2) - -

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

(` in million) Sr. articuars ratuit uded ratuit fuded No. As at As at As at As at 31.03.2020 31.03.2020 air vaue of pa assets at the eii of 1024.4 - - the year Fair value of plan assets at the end of the year - - III) Reconciliation of PVO and fair value of plan assets: O at the ed of the ear 2190.4 1771.7 Fair Value of plan assets at the end of the year - - Funded status (595.1) recoised actuaria ai oss - - - - et iaiit recoised i the aace heet (595.1) IV) Expense recognised in the Statement of Profit and Loss: Current service cost 160.5 101.8 85.4 ast service cost - - - - Interest cost 29.4 88.1 81.6 ota expese recoised i the tateet of 214.7* 189.9* 167.0 rot ad oss V) Other Comprehensive Income Actuaria oss ai ue to deoraphic assuptio (0.5) - 0.9 - ue to ace assuptio 202.8 85.2 122.7 68.6 ue to experiece assuptio 20.7 18.4 (141.4) etur o pa assets excudi et iterest (2.5) - ota aout recoised i OC 89.6 142.0 (72.8) VI) Category of assets as at the end of the year: surer aaed uds - NA ud is aaed C as per A uideies cateorise copositio of the pa assets is not available) VII) Actual return on the plan assets: 109.7 96.2 - NA VIII) Assumptions used in accounting for the gratuity plan: ortait Rates stipulated in Indian Assured Lives Mortality 2006-08 upto Rates stipulated in Indian Assured Lives Mortality 2012-14 from 01.04.2019 onwards iscout rate 6.8 7.7 6.8 7.7 aar escaatio rate for rst for rst for rst for rst three years and three years and three years and three years and 6.0 thereafter 6.0 thereafter 6.0 thereafter 6.0 thereafter Averae eaii ervice ears 11.6 11.6 Epoee Attritio ate up to 5 years 15.0 15.0 15.0 15.0 above 5 years 5.0 5.0 5.0 5.0 IX) Estimate of amount of contribution in 267.4 NA NA immediate next year

* ` 1.8 million (previous year ` 1.9 million) capitalised as pre-operative expenses out of above amount.

264 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

X) Expected future benefit payments (` in million) articuars As at 31.03.2020 1 year 514.1 2 to 5 years 1209.7 6 to 10 years More than 10 years

he estiates of saar escaatio cosidered i actuaria vauatio tae accout of iatio seiorit promotion and other relevant factors such as supply and demand in the employment market. easoa possie chaes at the reporti date to oe of the reevat actuaria assuptios hodi other assuptios costat oud have affected the deed eet oiatio the aouts sho eo (` in million) ratuit uded 2019-2020 2018-2019 Increase ecrease Increase ecrease iscout ate oveet (282.4) (221.4) 255.4 uture saar roth oveet (284.6) 255.0 (224.8)

B) The provident fund plan of the Company, except at one plant, is operated by “Lupin Limited Employees rovidet ud rust rust a separate ea etit Eiie epoees receive eets fro the said rovidet ud oth the epoees ad the Copa ae oth cotriutios to the rovidet ud as eua to a specied percetae of the covered epoees saar he iiu iterest rate paae the rust to the eeciaries ever ear is ei otied the overet of dia he Copa has a oiatio to ae ood the shortfa if a etee the retur fro the ivestets of the rust ad the otied iterest rate he oard of rustees adiister the cotriutios ade the Copa to the schees ad aso dees the ivestet strate to act i the best interest of the plan participants. he Copa has a oiatio to service the shortfa o accout of iterest eerated the fud ad o aturit of fud ivestets ad hece the sae has ee cassied as eed eet a i accordace ith d A Epoee eets As per the uidace ote fro the Actuaria ociet of dia the Copa has otaied the actuaria vauatio of iterest rate oiatio i respect of rovidet ud as at arch ad ased o the sae there is o shortfa toards iterest rate oiatio ased o the actuaria vauatio otaied the fooi is the detais of fud ad pa assets (` in million) Sr. As at As at articuars No. 31.03.2020 I) PVO and fair value of plan assets: Fair Value of plan assets reset aue of deed eet oiatios Net excess /(Shortfall) II) Changes in defined benefit obligation: iaiit at the eii of the ear Interest cost Current service cost Employee contribution Liability Transferred in eets paid Actuaria aioss o experiece variace Liability at the end of the year

Lupin Limited | Annual Report 2019-20 265 Notes Forming part of the Standalone Financial Statements

(` in million) Sr. articuars As at As at No. 31.03.2020 III) Changes in fair value of plan assets: air vaue of pa assets at the eii of the ear Investment income Employer’s contributions Employee’s contribution Transfers in - eets paid etur o pa assets excudi aout recoised i et iterest expese Fair value of plan assets at the end of the year IV) Expenses recognized in Statement of Profit and Loss: Current service cost Interest cost Expected return on plan assets coe Expese recoised i the tateet of rot ad oss V) Major categories of Plan Assets (As per percentage of Total Plan Assets): overet of dia securities tate overet securities Hih uait corporate ods Euit shares of isted copaies et utua ud Euit utua ud pecia eposit chee Bank balance Total VI) Assumptions used in accounting for the provident fund plan: iscout rate Averae reaii teure of ivestet portfoio ears uarateed rate of retur Attritio rate upto ears Aove ears

46. Income taxes: a. Tax expense/(benefit) recognised in profit and loss: (` in million) articuars Year ended Year ended 31.03.2020 Current Tax Expense for the year Tax expense w/back of prior years (58.5) (81.0) Net Current Tax Expense 7950.0 eferred icoe tax iaiitasset et Oriiatio ad reversa of teporar differeces 85.4 Tax expense for the year 3247.0 8035.4

266 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

b. Tax expense/(benefit) recognised in other comprehensive income: (` in million) articuars Year ended Year ended 31.03.2020 Items that will not be reclassified to profit or loss eeasureets of the deed eet pas 154.8 6.0 Items that will be reclassified to profit or loss he effective portio of ais ad oss o hedi istruets i a cash o hede 157.7 0.5 Total 312.5 6.5

c. Reconciliation of tax expense/(benefit) and accounting profit multiplied by India’s domestic tax rate: (` in million) articuars Year ended Year ended 31.03.2020 Profit before tax including exceptional item 10522.5 ax usi the Copas doestic tax rate arch arch 8185.2 Tax effect of: Expenses not deductible for tax purposes 2774.1 2601.9 pact of chae i tax rates (11.8) (0.1) creeta deductio aoed for esearch ad eveopet costs (982.2) Exeptio of prot i icetives (1927.4) (1510.1) Other Exeptio coe (51.6) (147.1) Tax Incentive on additional employment (18.9) Other Current and Deferred Tax expense (excluding prior year taxes) as per note 46(a) 3305.5 8116.4

d. Movement in deferred tax balances:

(Current Year ` in million) articuars Net balance ecoised i ecoisedi Net balance eferred tax eferred tax April 1, 2019 prot or oss Retained March 31, 2020 asset liability Earis OC Deferred tax assets/ (liabilities) ropert pat ad (4044.7) - euipet Cash o Hede (24.7) 157.7 - Reserve Trade Receivables 5 7. 2 16.8 74.0 74.0 - Mark to Market - (0.8) (0.8) - (0.8) aioss eferred coe (86.0) 248.2 248.2 - VRS Compensation 29.6 26.6 26.6 - Epoee eets 808.2 88.0 154.8 1051.0 1051.0 - Other ites 178.0 (4.0) 46.8 220.8 220.8 - Net Deferred tax assets / (liabilities) (2662.2) (1929.4)

Lupin Limited | Annual Report 2019-20 267 Notes Forming part of the Standalone Financial Statements

revious ear ` in million) articuars Net balance ecoised i ecoised Net balance eferred tax eferred tax April 1, 2018 prot or oss i OC arch asset liability

Deferred tax assets/ (liabilities) ropert pat ad (4027.6) (17.1) - (4044.7) - (4044.7) euipet Cash o Hede (25.2) - 0.5 (24.7) - (24.7) Reserve Trade Receivables 78.6 (21.4) - 5 7. 2 5 7. 2 - eferred coe (9.5) - - VRS Compensation - 29.6 29.6 - Epoee eets 49.2 6.0 808.2 808.2 - Other ites 261.4 - 178.0 178.0 - Net Deferred tax (85.4) 6.5 (2662.2) 1407.2 (4069.4) assets / (liabilities)

iicat aaeet udeet is reuired i deterii provisio for icoe tax deferred icoe tax assets and liabilities and recoverability of deferred income tax assets. The recoverability of deferred income tax assets is based on estimates of taxable income and the period over which deferred income tax assets will be recovered A chaes i future taxae icoe oud ipact the recoveraiit of deferred tax assets As o arch tax iaiit ith respect to the divideds proposed efore the acia stateets approved for issue ut ot recoised as a iaiit i the acia stateets is ` nil (previous year ` million). he iistr of Corporate Affairs vide its oticatio dated th arch iserted Appedix C certait over coe ax reatets to d A coe axes appicae fro st Apri he copa opted the trasitio provisio provided i this Appedix C he copa has idetied ucertai tax positios ad has estimated the liability based on the most likely amount. These estimates are based on its probability assesset of the ucertai tax treatet accordi the Copa recoised tax provisio of ` iio as a adustet to the opei aace of retaied earis o st Apri 47. he areate aout of reveue expediture icurred duri the ear o esearch ad eveopet ad shown in the respective heads of account is ` iio previous ear ` iio 48. he areate aout of cash expediture icurred duri the ear o Corporate ocia esposiiit (CSR) is ` iio previous ear ` iio ad is sho separate uder ote ased o uidace ote o Accouti for Expediture o C Activities issued the CA

(` in million) articuars 2019-2020 2018-2019 oatios Epoee eets Expese 18.1 Others atiet Aareess etc 19.4 19.0 Total 342.0 379.5 he aout reuired to e spet the Copa duri the ear is ` iio previous ear ` iio o aout as spet duri the ear toards costructioacuisitio of a asset reati to C expediture ad there are o outstadi aouts paaes toards a other purposes

268 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

49. he iforatio reardi icro Eterprises ad a Eterprises has ee deteried to the extet such parties have ee idetied o the asis of iforatio avaiae ith the Copa (` in million) articuars As at As at 31.03.2020 i. he pricipa aout ad the iterest due thereo reaii upaid to a 989.4 1046.1 suppier at the ed of each accouti ear (interest ` nil) (interest ` nil) ii. The amount of interest paid by the buyer in terms of Section 16 of the Micro Small - - ad ediu Eterprises eveopet Act ao ith the aout of the paet ade to the suppier eod the appoited da duri each accouti year iii. he aout of iterest due ad paae for the period of dea i ai paet - - ut ithout addi the iterest specied uder the icro a ad ediu Eterprises eveopet Act iv. he aout of iterest accrued ad reaii upaid at the ed of each - - accouti ear v. he aout of further iterest reaii due ad paae eve i the succeedi - - years until such date when the interest dues above are actually paid to the small enterprise for the purpose of disallowance of a deductible expenditure under ectio of the icro a ad ediu Eterprises eveopet Act

50. Exceptional Items: uri the ear the copa recoied fooi ites as exceptioa ites a) Settlement with the State of Texas: he exas Attore eeras office served upi haraceuticas c ith severa Civi vestiative eads fro a ad cotiui throuh he tate of exas the tate ed a asuit aaist upi td upi c ad certai executives o ue the Oriia asuit aei vioatios of the exas edicaid raud revetio Act A uri the ear the tate offered a setteet of iio to upi roup of hich iio as aread accrued i earier ears der the setteet areeet the tate ad upi roup had areed o a of the ters of the setteet ad the tate areed to disiss the idividua defedats iediate ia paet of iio ` iio ad iio ade duri the ear b) Impairment of IPs: ooi our aua ipairet revie the ipairet chares recoied i the stadaoe prot ad oss accout i reatio to certai itaie assets ad itaie assets uder deveopet is as foos

taie assets ` iio taie assets uder deveopet ` iio oth the cateories referred to aove reate to itaies acuired as part of the acuisitio of avis roup avis reated to aret havi ipaired priari o accout of i siicat prici pressure resuti fro custoer cosoidatio ito are ui roups capae of extracti reater price reductios ii ipeetatio of coutereasures aaist usae of Opioids i ited states ad iii deas i the auch of soe of our e eeric products

Lupin Limited | Annual Report 2019-20 269 Notes Forming part of the Standalone Financial Statements

he ipairet has ee deteried cosideri each idividua itaie asset as a cash eerati uit C except for s uder deveopet hich have ee assessed toether as oe C ecoverae aout of Cs for hich ipairet is doe is ` iio ecoverae aout ie hiher of vaue i use ad fair vaue ess cost to se of each idividua C as copared to carri vaue ad ipairet aout as arrived as foos Cs here carri vaue as hiher tha recoverae aout ere ipaired ad Cs here recoverae aout as hiher tha carri vaue ere carried at carri vaue he fair vaue so used is cateoried as a eve vauatio i ie ith the fair vaue hierarch per reuireets of d A air aue easureet d A he fair vaue has ee deteried ith referece to the discouted cash o techiue

The key assumptions used in the estimation of the recoverable amounts is as mentioned below. he vaue assied to the e assuptios represets aaeets assesset of the future treds in the industry and have been based on historical data from both external and internal sources. Assumption How Determined roected cash os ased o past experiece ad adusted for the fooi - Current market dynamics - Anticipated competition pact due to CO o ter roth rate o ter roth rate has ee deteried ith referece to market dynamics of each individual product osttax ris adusted discouti rate roected cash os ere discouted to preset vaue at a discount rate that is commensurate with all risks of oership ad associated riss of reaii the proected residua prots Each product cateor Curret areted roducts ad approved AAs ied AAs ad face differet riss ad accordi differet discout rates ere deteried ased o each product cateors ris proe iscout rate as coiatio of cost of det ad cost of euit Cost of euit as estiated usi capita asset prici ode he proected cashos are discouted at posttax rate rai fro to he teria roth rate is cosidered at he cash o proectios are ased o ve ears specic estiates ve ears estiates deveoped usi itera forecasts ad a teria roth rate thereafter cosideri the ife of itaies ei approx ears he aaeet has cosidered te ear roth rate sice the sae appropriate reects the period over hich the future eets of the itaies i accrue to the Copa ased o the assesset carried out as at arch ad after cosideri perforace for the fu ear eded arch o further provisio have ee ade c) Fine to European Commission ast ear the eera Court of the Europea io deivered its udeet coceri upis appea aaist the Europea Coissios EC decisio i case of aeed reach of the E Atitrust ues i the eridopri this respect the Copa has ade a provisio of E iio ` iio icudi iterest ad ithhodi tax thereo of E iio ` iio hich as discosed as a exceptioa ite he Copa has ed appea aaist this udeet i the Court of ustice of the Europea io

270 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

51. As per best estimates of the management, provision has been made as under: a) Probable return of goods from customers: (` in million) articuars 2019-2020 2018-2019 Carri aout at the eii of the ear 1195.6 1007.4 Add Additioa rovisios ade duri the ear 1957.8 1801.7 ess Aouts used utiised duri the ear Carri aout at the ed of the ear 1420.8 1195.6 b) European Commission fine: (` in million) articuars 2019-2020 2018-2019 Carri aout at the eii of the ear - Add Additioa rovisios icudi iterest ade duri the ear 54.8 ess Aouts used utiised duri the ear - - Add Exchae ifferece duri the ear 218.9 - Carri aout at the ed of the ear

52. Financial Instruments: Financial instruments – Fair values and risk management: A. Accounting classification and fair values: Carri aouts ad fair vaues of acia assets ad acia iaiities icudi their eves i the fair vaue hierarch are preseted eo t does ot icude the fair vaue iforatio for acia assets ad acia iaiities ot easured at fair vaue if the carri aout is a reasoae approxiatio of fair value.

Fair value hierarchy eve uoted prices uadusted i active arets for idetica assets or iaiities eve puts other tha uoted prices icuded ithi eve that are oservae for the asset or liability either directly (i.e. as prices) or indirectly (i.e. derived from prices). eve puts for the assets or iaiities that are ot ased o oservae aret data uoservae inputs). (` in million) As at 31.03.2020 Carri aout Fair value erivatives Amortised Total Level 1 Level 2 eve Total desiated as Cost hede Financial assets Non-Current Investments Cs - Others 19.7 - - 19.7 - - 19.7* 19.7 Non-Current Loans ecurit eposit - - 445.2 445.2 - - - - Others - - 2.0 2.0 ---- Other oCurret iacia Assets erivative struets ------ Others - - 9.7 9.7 ---- Current Investments - 10292.4 -- Trade Receivables - - ----

Lupin Limited | Annual Report 2019-20 271 Notes Forming part of the Standalone Financial Statements

(` in million) As at 31.03.2020 Carri aout Fair value erivatives Amortised Total Level 1 Level 2 eve Total desiated as Cost hede Cash ad Cash Euivaets - - 11680.2 11680.2 - - - - Other a aaces icudi - - ---- earmarked balances with banks Current Loans - - ---- Other Curret iacia Assets erivative istruets ------ Others - - ---- 13024.6 - 63566.6 76591.2 13004.9 - 19.7 13024.6 Financial liabilities oCurret orrois - - ---- rade aaes ------Other oCurret iacia Liabilities erivative istruets - - ---- Others - - 894.6 894.6 - - - - Curret orrois - - 52.9 52.9 - - - - rade aaes - - ---- Other Curret iacia Liabilities erivative istruets - - ---- Others - - 2587.8 2587.8 - - - - - 460.6 19199.7 19660.3 - - - -

(` in million) As at Carri aout Fair value erivatives Amortised Total Level 1 Level 2 eve Total desiated as Cost hede

Financial assets Non-Current Investments Cs - - ---- Others 19.7 - 25.0 - - 19.7* 19.7 Non-Current Loans ecurit eposit - - 612.5 612.5 - - - - Others - - 14.9 14.9 ---- Other oCurret iacia Assets erivative istruets ------ Others - - ---- Current Investments 16741.9 - 16741.9 - - 16741.9 Trade Receivables - - ---- Cash ad Cash Euivaets - - 559.4 559.4 - - - - Other a aaces icudi - - 55.0 55.0 ---- earmarked balances with banks Current Loans - - 229.1 229.1 ---- Other Curret iacia Assets erivative istruets 1.2 - 101.5 - 101.5 - 101.5

272 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

(` in million) As at Carri aout Fair value erivatives Amortised Total Level 1 Level 2 eve Total desiated as Cost hede

Others - - ---- 16762.8 100.3 50807.5 67670.6 16741.9 101.5 19.7 16863.1 Financial liabilities oCurret orrois - - ---- rade aaes - - 16.1 16.1 ---- Other oCurret iacia - - 149.6 149.6 - - - - Liabilities Curret orrois - - 16.8 16.8 ---- rade aaes - - 12540.2 12540.2 - - - - Other Curret iacia Liabilities erivative istruets ------ Others - - 1577.2 1577.2 ------14305.2 14305.2 ----

* These are for operation purposes and the Company expects its refund on exit. The Company estimates that the fair value of these ivestets are ot ateria differet as copared to its cost

B. Measurement of fair values: auatio techiues ad siicat uoservae iputs

he fooi taes sho the vauatio techiues used i easuri eve ad eve fair vaues for acia istruets easured at fair vaue i the stateet of acia positio as e as the siicat unobservable inputs used.

Type auatio techiue iicat Inter-relationship unobservable etee siicat inputs unobservable inputs and fair value measurement erivative istruets orard prici he fair vaue is deteried Not Not applicable usi uoted forard exchae rates at the applicable reporti date ad preset vaue cacuatios ased o hih credit uait ied curves i the respective currency. ocurret acia assets ad iscouted cash os he vauatio ode Not Not applicable liabilities considers the present value of expected applicable receiptpaet discouted usi appropriate discouti rates

C. Financial risk management: he Copa has exposure to the fooi riss arisi fro acia istruets - Credit risk; iuidit ris ad - Market risk

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

The Company’s board of directors has overall i. Credit risk: resposiiit for the estaishet ad oversiht Credit ris is the ris of acia oss to the of the Copas ris aaeet fraeor Company if a customer or counterparty to a The board of directors has established the Risk acia istruet fais to eet its cotractua aaeet Coittee hich is resposie for oiatios ad arises pricipa fro the deveopi ad oitori the Copas ris Company’s receivables from customers and aaeet poicies he coittee reports to ivestet securities Credit ris is aaed the board of directors on its activities. throuh credit approvas estaishi credit iits ad cotiuous oitori the creditorthiess he Copas ris aaeet poicies are of custoers to hich the Copa rats established to identify and analyse the risks faced credit terms in the normal course of business. by the Company to set appropriate risk limits and The Company establishes an allowance for controls and to monitor risks and adherence to doubtful debts and impairment that represents its iits is aaeet poicies ad sstes estimate of incurred losses in respect of trade and are revieed periodica to reect chaes i other receivables and investments. market conditions and the Company’s activities. he Copa throuh its traii stadards ad Trade receivables procedures aims to maintain a disciplined and The Company’s exposure to credit risk is constructive control environment in which all iueced ai the idividua characteristics epoees uderstad their roes ad oiatios of each custoer he deoraphics of the custoer icudi the defaut ris of the idustr he audit coittee oversees ho aaeet and country in which the customer operates monitors compliance with the Company’s risk aso has a iuece o credit ris assesset aaeet poicies ad procedures ad Credit ris is aaed throuh credit approvas revies the adeuac of the ris aaeet estaishi credit iits ad cotiuous framework in relation to the risks faced by the oitori the creditorthiess of custoers Company. The audit committee is assisted in its to hich the Copa rats credit ters i the oversiht roe itera audit tera audit normal course of business. udertaes oth reuar ad ad hoc revies of ris aaeet cotros ad procedures the resuts As at ear ed the carri aout of the of which are reported to the audit committee. Copas arest custoer a usidiar based in North America) was ` iio (previous year ` iio

uar of the Copas exposure to credit ris ae of the outstadi fro various custoers is as foos

(` in million) articuars As at As at 31.03.2020 Not past due but impaired 1.5 2.9 Neither past due not impaired 21981.8 27679.1 ast due ot ipaired - 1-180 days das 611.5 245.8 ore tha das 7.8 ast due ipaired - 1-180 days 9.1 12.4 das 28.0 26.7 ore tha das 97.0 76.8 Total 36298.9 37362.0

274 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

Expected credit loss assessment he Copa aocates each exposure to a credit ris rade ased o a variet of data that is deteried to e predictive of the ris of oss e tieiess of paets avaiae press iforatio etc ad appi experieced credit udeet Exposures to custoers outstadi at the ed of each reporti period are revieed the Copa to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reect a siicat credit osses ive that the acroecooic idicators affecti custoers of the Copa have ot uderoe a sustatia chae the Copa expects the historica tred of iia credit losses to continue. he oveet i the aoace for ipairet i respect of trade ad other receivaes duri the ear as as foos (` in million) articuars 2019-2020 2018-2019 aace as at the eii of the ear 118.8 182.1 pairet oss recoised et 68.2 Aouts ritte off (20.4) Exchae differeces 0.2 2.5 Balance as at the year end 118.8

he ipairet oss at arch reated to ii. Liquidity risk: several customers that have defaulted on their iuidit ris is the ris that the Copa i payments to the Company and are not expected ecouter difficut i eeti the oiatios to e ae to pa their outstadi aaces associated ith its acia iaiities that are mainly due to economic circumstances. setted deiveri cash or aother acia Cash and cash equivalents asset he Copas approach to aai As at the year end the Company held cash iuidit is to esure as far as possie that it i ad cash euivaets of ` iio have sufficiet iuidit to eet its iaiities he (previous year ` iio he cash ad cash they are due under both normal and stressed euivaets are hed ith as coditios ithout icurri uacceptae osses or risi daae to the Copas reputatio Other Bank Balances Other a aaces are hed ith as The Company has obtained fund and non-fund ased ori capita ies fro various as Derivatives The Company invests its surplus funds in bank The derivatives are entered into with banks. xed deposit ad iuid ad iuid pus schees I nvestment in mutual funds non-convertible of mutual funds non-convertible debentures debentures and commercial papers commercial papers which carry no/low mark to The Company limits its exposure to credit risk aret riss he Copa oitors fudi eera ivesti i iuid securities o options available in the debt and capital markets convertible debentures commercial papers and ith a vie to aitaii acia exiiit o ith couterparties that have a ood credit Exposure to liquidity risk rati he Copa does ot expect a osses he fooi are the reaii cotractua from non-performance by these counter-parties aturities of acia iaiities at the reporti Other financial assets date he aouts are ross ad udiscouted Other acia assets are either past due or and include estimated interest payments and impaired. excude the ipact of etti areeets

Lupin Limited | Annual Report 2019-20 275 Notes Forming part of the Standalone Financial Statements

(` in million) As at 31.03.2020 Carri Contractual Cash Flows amount Total 0-12 months 1-2 years 2-5 years More than 5 years oderivative acia iaiities oCurret orrois 5.4 5.4 1.6 1.5 - terest aaes - 9.6 8.9 20.0 6.8 rade aaes oCurret ------Other oCurret iacia 894.6 894.6 - 462.4 98.5 Liabilities Curret orrois 52.9 52.9 52.9 - - - rade aaes Curret - - - Other Curret iacia 2585.5 2585.5 2585.5 - - - Liabilities ssued acia uaratee ------contracts on behalf of subsidiaries* erivative acia iaiities orard exchae cotracts ross setted Outo 460.6 460.6 - - o - - - - - Total 19660.3 19705.6 18470.9 645.5 483.9 105.3

(` in million) As at Carri Contractual Cash Flows amount Total 0-12 months 1-2 years 2-5 years More than 5 years oderivative acia iaiities oCurret orrois 40.8 40.8 - terest aaes 0.1 56.1 10.9 9.6 11.9 rade aaes oCurret 16.1 16.1 - 7.1 9.0 Other oCurret iacia 149.6 149.6 18.4 91.8 Liabilities Curret orrois 16.8 16.8 16.8 - - - rade aaes Curret 12540.2 12540.2 12540.2 - - - Other Curret iacia 1541.6 1541.6 1541.6 - - - Liabilities ssued acia uaratee ------contracts on behalf of subsidiaries* erivative acia iaiities orard exchae cotracts ross setted Outo ------ o - - - - - Total 14305.2 14361.2 14152.3 37.4 67.8 103.7

uaratees issued the Copa o ehaf of susidiaries are ith respect to orrois raised the respective susidiar hese aouts i e paae o defaut the cocered susidiar As of the reporti date oe of the susidiar have defauted ad hece the Copa does ot have a preset oiatio to third parties i reatio to such uaratees efer ote C

iii. Market Risk: aret ris is the ris that chaes i aret prices such as forei exchae rates iterest rates ad euit prices i affect the Copas icoe or the vaue of its hodis of acia istruets aret ris is attriutae to a aret ris sesitive acia istruets icudi forei currec receivaes ad paaes ad o ter det e are exposed to aret ris priari reated to forei exchae rate ris hus our exposure to aret ris is a fuctio of reveue eerati ad operati activities i forei currec he oective of aret ris aaeet is to avoid excessive exposure i our forei currec reveues ad costs he Copa uses derivatives to aae aret ris eera the Copa sees to app hede accouti to aae voatiit i prot or oss

276 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

Currency risk The Company is exposed to currency risk on account of its operations in other countries. The functional currency of the Copa is dia upee he exchae rate etee the dia rupee ad forei currecies has chaed sustatia i recet periods ad a cotiue to uctuate i the future Coseuet the Copa uses oth derivative istruets ie forei exchae forard cotracts to itiate the ris of chaes i forei currec exchae rates i respect of its hih proae forecasted trasactios ad recoied assets and liabilities. he Copa eters ito forei currec forard cotracts hich are ot iteded for tradi or specuative purposes ut for hede purposes to estaish the aout of reporti currec reuired or avaiae at the settlement date of certain payables/receivables. he Copa aso eters ito derivative cotracts i order to hede ad aae its forei currec exposures toards future export earis uch derivatives cotracts are etered ito the Copa for hedi purposes o ad are accordi cassied as cash o hede ooi is the derivative acia istruets to hede the forei exchae rate ris (Amount in million) Cateor Instrument Currency Cross As at As at Buy/Sell Currency 31.03.2020 Hedes of hih proae forecasted Forward INR Sell transactions contract

he Copa has ot etered ito forei currec forard cotract for purposes other tha hedi Exposure to Currency risk ooi is the currec proe of oderivative acia assets ad acia iaiities (` in million) articuars As at 31.03.2020 USD EURO GBP JPY Others Financial assets Cash ad cash euivaets 18.9 - - - 5.0 Trade Receivables 721.7 419.8 198.0 Other curret acia assets - - - - - 28414.5 721.7 419.8 198.0 Financial liabilities rade aaes 490.9 42.9 80.8 Other curret acia iaiities 50.7 0.7 1.8 10.1 4120.0 94.1 44.7 90.9 et stateet of acia positio exposure 25057.6 (3398.3) 325.7 153.3 223.3

(` in million) articuars As at EO Others Financial assets Cash ad cash euivaets - - 68.8 5.6 Trade Receivables 821.2 Other curret acia assets 104.8 4.2 1.5 29.4 1.9 460.5 215.4 204.5 828.7 Financial liabilities rade aaes 2781.5 20.8 Other curret acia iaiities 62.8 25.5 6.4 2 7. 2 et stateet of acia positio exposure 27704.1 (3075.9) 136.1 171.2 801.5

Lupin Limited | Annual Report 2019-20 277 Notes Forming part of the Standalone Financial Statements

Sensitivity analysis A reasoa possie strethei eaei of the dia upee aaist forei currec at arch oud have affected the easureet of acia istruets deoiated i forei currec ad affected euit ad prot or oss the aouts sho eo his aasis assues that a other variaes i particuar iterest rates reai costat ad iores a ipact of forecast saes ad purchases (` in million) March 31, 2020 Profit or (loss) Equity net of tax* 1% movement Strengthening Weakening Strengthening Weakening (250.6) 250.6 (246.8) 246.8 EUR 22.4 (22.4) (2.1) 2.1 (1.5) 1.5 (1.0) 1.0 Others (2.2) 2.2 (1.5) 1.5 (223.6) 223.6 (229.0) 229.0

(` in million) arch rot or oss Euit et of tax oveet trethei eaei trethei eaei (277.0) 277.0 (250.8) 250.8 EUR (1.4) 1.4 (0.9) 0.9 (1.7) 1.7 (1.1) 1.1 Others (8.0) 8.0 (257.3) 257.3 (237.8) 237.8 icudi other coprehesive icoe Interest rate risk terest rate ris ca e either fair vaue iterest rate ris or cash o iterest rate ris air vaue iterest rate ris is the ris of chaes i fair vaues of xed iterest eari acia assets or orrois ecause of uctuatios i the iterest rates if such assetsorrois are easured at fair vaue throuh prot or oss Cash o iterest rate ris is the ris that the future cash os of oati iterest eari orrois i uctuate ecause of uctuatios i the iterest rates Exposure to interest rate risk Copas iterest rate ris arises fro orrois ad ace ease oiatios he iterest rate proe of the Copas iteresteari orrois is as foos

(` in million) articuars As at As at 31.03.2020 oCurret orrois ixed rate orrois 5.4 40.8 ariae rate orrois - - 5.4 40.8 Curret orrois ixed rate orrois - - ariae rate orrois 52.9 16.8 52.9 16.8 Total 58.3 5 7.6

278 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

air vaue sesitivit aasis for xedrate istruets he Copa does ot accout for a xedrate orrois at fair vaue throuh prot or oss herefore a chae i iterest rates at the reporti date oud ot affect prot or oss Cash o sesitivit aasis for variaerate istruets A reasoa possie chae of asis poits i iterest rates at the reporti date oud have icreased decreased prot or oss the aouts sho eo his aasis assues that a other variaes i particuar forei currec exchae rates reai costat

(` in million) articuars rot or oss 100 bp increase 100 bp decrease Cash o sesitivit et March 31, 2020 ariaerate orrois (0.5) 0.5 arch ariaerate orrois (0.2) 0.2

he ris estiates provided assue a chae of asis poits iterest rate for the iterest rate echar as appicae to the orrois suarised aove his cacuatio aso assues that the chae occurs at the aace sheet date ad has ee cacuated ased o ris exposures outstadi as at that date he period ed aaces are ot ecessari represetative of the averae det outstadi duri the period

Commodity rate risk he Copas operati activities ivove purchase ad sae of Active haraceutica rediets A hose prices are exposed to the ris of uctuatio over short periods of tie Coodit price ris exposure is evauated ad aaed throuh procureet ad other reated operati poicies As of arch ad arch the Copa had ot etered ito a ateria derivative cotracts to hede exposure to uctuatios i coodit prices.

53. Capital Management: he Copas poic is to aitai a stro capita ase so as to aitai ivestor creditor ad aret codece ad to sustai future deveopet of the usiess aaeet oitors the retur o capita as e as the eve of dividends to ordinary shareholders.

he oard of directors sees to aitai a aace etee the hiher returs that iht e possie ith hiher eves of orrois ad the advataes ad securit afforded a soud capita positio

he Copa oitors capita usi a ratio of adusted et det to tota euit or this purpose adusted et det is deed as tota iaiities coprisi iteresteari oas ad orrois ess cash ad cash euivaets other bank balances and current investments.

he Copas poic is to eep the ratio eo he Copas adusted et det to tota euit ratio at arch as as foos (` in million) articuars As at As at 31.03.2020 ota orrois 5 7.6 ess Cash ad cash euivaet 11680.2 559.4 ess Other a aaces ess Curret vestets Adjusted net debt (21644.9) ota euit 171172.7 Adusted et det to tota euit ratio (0.21) icudes earared a deposits aaist uaratees other coitets of ` 9.7 million (previous year ` iio cassied as Other oCurret iacia Assets Lupin Limited | Annual Report 2019-20 279 Notes Forming part of the Standalone Financial Statements

54. Hedge accounting: he Copas ris aaeet poic is to hede aove of its estiated forei currec exposure i respect of hih proae forecast saes over the fooi oths he Copa uses forard exchae cotracts to hede its currec ris uch cotracts are eera desiated as cash o hedes he forard exchae forard cotracts are deoiated i the sae currec as the hih proae forecast saes therefore the hede ratio is hese cotracts have a aturit of oths fro the reporti date he Copas poic is for the critica ters of the forard exchae cotracts to ai ith the heded item. he Copa deteries the existece of a ecooic reatioship etee the hedi istruet ad heded ite ased o the currec aout ad tii of their respective cash os he Copa assesses hether the derivative desiated i each hedi reatioship is expected to e ad has ee effective i offsetti chaes i the cash os of the heded ite usi the hpothetica derivative ethod these hede reatioships chaes i tii of the heded trasactios is the ai source of hede ieffectiveess a. Disclosure of effects of hedge accounting on financial position (` in million) As at 31.03.2020 pe of hede Nominal Carri aout Line item in Maturity Hede eihted Chaes i Chae i and risks Value of hedi the statement date ratio Averae fair value the value i instrument of acia strike of the of heded mn) position where price/rate hedi item used as the hedi instrument the basis for instrument is recoii included hede effectiveess

Assets Liabilities Cash o 0 460.6 Other curret hede non-current acia iaiit

Forward -- -Other curret u 1.1 76.59 5 07. 2 exchae acias March 2022 forward liabilities/non contracts non-current acia liabilities

(` in million) As at pe of hede Nominal Carri aout Line item in Maturity Hede eihted Chaes i Chae i and risks Value of hedi the statement date ratio Averae fair value the value i instrument of acia strike of the of heded mn) position where price/rate hedi item used as the hedi instrument the basis for instrument is recoii included hede effectiveess

Assets Liabilities Cash o 149.0 101.5 - Other curret hede acia assets

April 2019 – 71.25 106.9 (107.2) Forward -- -Other o March 2020 exchae curret acia forward assets contracts

280 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements b. Disclosure of effects of hedge accounting on financial performance (` in million) As at 31.03.2020 Chae i the Hede Line item in the Aout recassied ie ite affected i value of the ieffectiveess stateet of prot or fro cash o stateet of prot or hedi istruet recoised i loss that includes the hedi reserve to loss because of the recoised i OC prot or oss hede ieffectiveess prot or oss recassicatio Cash o (2.5) Other Expeses Revenue from hede et oss o orei operations - Sale of Currency Transactions oods

(` in million) As at Chae i the Hede Line item in the Aout recassied ie ite affected i value of the ieffectiveess stateet of prot or fro cash o stateet of prot or hedi istruet recoised i loss that includes the hedi reserve to loss because of the recoised i OC prot or oss hede ieffectiveess prot or oss recassicatio Cash o (1.2) Other Expeses (298.4) Revenue from hede et oss o orei operations - Sale of Currency Transactions oods c. he fooi tae provides a recociiatio ris cateor of copoets of euit ad aasis of OC ites et of tax resuti fro cash o hede accouti oveets i cash o hedi reserve Balance at April 1, 2018 60.6 Add Chaes i the fair vaue of effective portio of outstadi cash o derivative et of setteet ess Aouts recassied to prot or oss 299.6 ess eferred tax 0.5 As at March 31, 2019 7 7. 5 Add Chaes i the fair vaue of effective portio of outstadi cash o derivative et of setteet ess Aouts recassied to prot or oss ess eferred tax 157.7 As at March 31, 2020 (324.4)

55. Off-setting or similar agreements: he recoised acia istruets that are offset i aace sheet as at arch (` in million) As at 31.03.2020 Effects of offsetti o the aace sheet Aouts suect to aster etti ross ross aouts Net amounts Related amounts Net amount Amounts set off i the presented in the ot offset balance sheet balance sheet Financial assets erivative istruets - - - - - Trade and other - - - - - receivables Financial liabilities erivative istruets 460.6 460.6 460.6 Trade and other payables - - - - -

Lupin Limited | Annual Report 2019-20 281 Notes Forming part of the Standalone Financial Statements

he recoised acia istruets that are offset i aace sheet as at arch (` in million) As at Effects of offsetti o the aace sheet Aouts suect to aster etti ross ross aouts Net amounts Related amounts Net amount Amounts set off i the presented in the ot offset balance sheet balance sheet Financial assets erivative istruets 101.5 - 101.5 - 101.5 Trade and other receivables - - - - - Financial liabilities erivative istruets - - - - - Trade and other payables - - - - -

Offsetting arrangements (i) Trade receivables and payables he Copa has certai custoers hich are aso suppi aterias der the ters of areeet there are o aouts paae the Copa that are reuired to e offset aaist receivaes ii erivatives he Copa eters ito derivative cotracts for hedi future saes eera uder such areeets the aouts oed each couterpart o a sie da i respect of a the trasactios outstadi i the sae currec are areated ito a sie et aout that is paae oe part to the other

282 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

56. Related Party Disclosures, as required by Indian Accounting Standard 24 (Ind AS 24) are given below: A. Relationships – Category I: Entity having significant influence over the Company: upi vestets vt iited

Category II: Subsidiaries: upi haraceuticas c A oa haraceutica dustr Co iited apa upto eceer upi Austraia t iited Austraia aoi forer o as upi Hodis hara aics roprietar iited outh Africa Horosa hara H era uticare haraceuticas hiippies c hiippies upi Atatis Hodis A iterad Lupin Healthcare (UK) Limited UK upi hara Caada iited Caada Lupin Mexico S.A. de C.V. Mexico eeric Heath t iited Austraia eether hara t iited Austraia upi hiippies c hiippies Lupin Healthcare Limited India eeric Heath H aasia oa CritiCare Co iited apa upto epteer Lupin Middle East FZ-LLC UAE upi H iterad Lupin Inc. USA eduiica dustria araceutica A rai aoi etherads ered ith upi Hodis etherads o Octoer aoratorios ri A de C exico upi hara C ussia up to Apri Novel Laboratories Inc. USA avis haraceuticas C A upto arch Lupin Research Inc. USA upi raie C raie upto eruar Lupin Latam Inc. USA upi apa Asia acic apa ioix herapeutics C A up to eceer upi aaeet c A forer o as upi etures c upi Europe H era

Category III: Jointly Controlled Entity: iooics td apa

Category IV: Key Management Personnel (KMP) r aa hara upto epteer ice Chaira Executive irector s iita upta Chief Executive Officer r iesh eshadhu upta aai irector r aesh aiatha Executive irector oa CO upto eceer ef arch Head Corporate Affairs r ui aharia fro ue to arch teri Chief iacia Officer Mr. R.V. Satam Company Secretary

Lupin Limited | Annual Report 2019-20 Notes Forming part of the Standalone Financial Statements

Non- Executive Directors rs au upta Chairperso r aa hara ef epteer ice Chaira r a ear upto arch Mr. R. A. Shah Mr. Richard Zahn r ada r ieep C Chosi r eauc eiard s Christie A udur ef Apri

Category V: Others (Relatives of KMP and Entities in which the KMP and Relatives of KMP have control or significant influence) s avita upta auhter of Chairperso r Aua upta auhter of Chairperso r icha upta auhter of Chairperso s hefai ath upta ife of aai irector iss eda iesh upta auhter of aai irector aster ee eshadhu upta o of aai irector upta H upta ai rust Lupin Human Welfare and Research Foundation Lupin Foundation atashree oati evi aa eva idhi oova dustries iited a roperties vt iited hua rits hara Team Lease Services Limited

284 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

B. Transactions with the related parties: (` in million) Sr. Transactions For the For the No. year ended year ended 31.03.2020

1. ae of oods upi haraceuticas c Other usidiaries 2. aeesearch ervicesOthers Subsidiaries 940.0 ae of Euipet Others - 0.2 4. ees eceived aaist uaratees provided o their ehaf Subsidiaries 221.7 5. Services Rendered (Income) Subsidiaries 2.1 6. et aid Subsidiaries - - Others 66.2 75.8 7. esearch ad eveopet Expeses Lupin Research Inc. 1118.1 Other usidiaries 1.2 40.2 8. Expenses incurred on their behalf Recovered/Rent Received Subsidiaries Others 1.6 1.9 9. eueratio aid e aaeet ersoe 101.4 10. urchases of oodsaterias Subsidiaries 19.0 52.2 oit Cotroed Etit 16.5 - Others 170.7 150.7 11. Coissio Advisor ees itti ees to oExecutive irectors e aaeet ersoe 69.9 12. oatios aid Others 289.2 262.1 ivided aid Etit havi siicat iuece over the Copa 1028.0 1028.0 e aaeet ersoe 26.6 26.6 Others 9.2 9.1 14. Services Received (Expense) upi haraceuticas c 100.9 Other usidiaries 1045.2 851.7 Others 85.6 112.6 15. Expeses icurred o our ehaf Others eiurseets Subsidiaries 905.7 1111.5 Others 16. aaces ritte off Subsidiaries - 2 7.7 1 7. Balances written back Subsidiaries - 1.8 18. Letter of Comfort issued by the Company to the bankers of a Subsidiary upi haraceuticas c 1891.6 5186.6

Lupin Limited | Annual Report 2019-20 285 Notes Forming part of the Standalone Financial Statements

(` in million) Sr. Transactions For the For the No. year ended year ended 31.03.2020

19. Corporate uaratees issued the Copa to the aers of susidiar companies upi haraceuticas c 8550.1 76 07.1 Other usidiaries - 1694.2 20. ithdraa of corporate uaratees ive the Copa to the aers of subsidiary companies oa haraceutica dustr Co iited - Horosa hara H era 7 7.7 - oa Criticare Co td apa - Lupin Inc. USA -

eated part trasactios aove of reveue fro operatios are discosed separate (` in million) Copesatio aid to e aaeet ersoe For the For the Year ended Year ended 31.03.2020

hortter epoee eets 146.5 ostepoet eets 12.1 Share based payments 5.8 9.2 Total 101.4 249.3

ers ad coditios of trasactios ith reated parties he saes to ad purchases fro reated parties are ade o ters euivaet to those that prevai i ars eth trasactios Outstadi aaces at the eared are usecured ad iterest free ad setteet occurs in cash. C. Balances due from/to the related parties: (` in million) Sr. Balances As at As at No. 31.03.2020 1. Investments Subsidiaries 2. eposits paid uder eave ad icese arraeet for preises Others Trade Receivables Subsidiaries 27081.9 29281.6 4. rade aaes Subsidiaries 1666.0 678.9 oit Cotroed Etit 8.1 - Others 29.2 5. Expeses aae Subsidiaries 82.6 6. Expenses Receivable Subsidiaries 78.7 7. Income Receivable Subsidiaries 72.1 4 7. 5 8. aae for urchase of ropert pat ad euipettaie asset Subsidiary - 58.6 9. eposits received uder eave ad icese arraeet for preises Others 0.1 0.1

286 Corporate Overview Statutory Reports Financial Statements

Notes Forming part of the Standalone Financial Statements

(` in million) Sr. Balances As at As at No. 31.03.2020 10. Letter of Comfort issued by the Company to the bankers of subsidiary companies 7566.5 5186.6 11. Corporate uaratees issued the Copa to the aers of susidiar 84728.2 companies 12. uaratees issued the Copa o ehaf of susidiar copaies for 8575.2 cotractua oiatios rasactios ad aaces ith oit Cotroed Etit have ee reported at fu vaue

5 7. arch the iistr of Corporate Affairs issued the Copaies dia Accouti tadards Aedets ues otifi aedets to d A tateet of Cash os hese aedets are i accordace ith the aedets ade teratioa Accouti tadards oard A to A tateet of Cash os he eo discosure is i ie ith such aedets suested (` in million) articuars April 1, 2019 Cash Flows oCash Chaes March 31, Acuisitio orei Fair Value 2020 Exchae Chaes Movement Non-Current Borrowings Unsecured eferred aes ax oa fro (2.2) - - - overet of aharashtra er oas fro Couci for cietic - - - - - and Industrial Research (CSIR) Current maturities of Non-Current - - - orrois Current Borrowings Secured Loans from banks 16.8 - - - 52.9 terest accrued ut ot due o orrois 0.1 (0.1) - - - - Total Liabilities from financing activities 5 7.7 0.6 - - - 58.3 (` in million) articuars April 1, 2018 Cash Flows oCash Chaes arch Acuisitio orei Fair Value 2019 Exchae Chaes Movement Non-Current Borrowings Unsecured eferred aes ax oa fro 9.9 (4.6) - - - overet of aharashtra er oas fro Couci for cietic - - - - and Industrial Research (CSIR) er oas fro epartet of ------ciece ad echoo Current maturities of Non-Current 48.1 (12.6) - - - orrois Current Borrowings Secured Loans from banks 82.1 - - - 16.8 Unsecured Loans from Banks ------terest accrued ut ot due o orrois 0.4 - - - 0.1 Total Liabilities from financing activities 171.4 (113.7) - - - 5 7.7

Lupin Limited | Annual Report 2019-20 287 Notes ori part of the tadaoe iacia tateets

58. arch the ord Heath Oraisatio decared CO to e a padeic upp Chai disruptios as a resut of the outrea started ith restrictios o the oveet of oods cosure of orders etc i severa coutries fooed a oa ocdo i arch aouced the various overets to cotai the spread of CO ice the Copa aufactures ad suppies pharaceutica products hich are cateoried uder essetia oods the aufacturi ad suppies of the products have ee fuctioi ith iia disruptios he situatio is ie to further iprove ith a easi of restrictios i the coi das iht of these circustaces the Copa has adopted easures to cur the spread of ifectio i order to protect the heath of its epoees ad esure usiess cotiuit ith iia disruptio icudi reote ori aitaii socia distaci saitiatio of orspaces etc he Copa has cosidered itera ad extera iforatio hie aii various estiates i reatio to its acia stateet up to the date of approva of the acia stateets the oard of irectors ad has ot idetied a ateria ipact o the carri vaue of taie ad itaie assets acia assets ivetor receivaes etc as e as orrois ad iaiities accrued As etioed aove sice the Copa is ito aufacturi ad supp of pharaceutica products essetia oods there is o siicat ipact o the overa dead of the oods ad its supp chai he Copa has aso ot oserved a siicat dea i the coectio fro custoers thus there is o siicat icrease i Credit ris urther the Copas iuidit positio is adeuate to service a its ear ter det ad other aci arraeetsiaiities he actua ipact of the oa heath padeic a e differet fro that hich has ee estiated as the CO situatio evoves oa he Copa i cotiue to cose oitor a ateria chaes to future economic conditions.

59. revious ears ures have ee reroupedrecassied herever ecessar to correspod ith the curret ears cassicatiodiscosure

iature to ote to

In terms of our report attached For B S R & Co. LLP For and on behalf of Board of Directors of Lupin Limited Chartered Accountants ir eistratio o

Venkataramanan Vishwanath Manju D. Gupta Dr. Kamal K. Sharma Vinita Gupta arter Chairperson Vice Chairman Chief Executive Officer eership o

Nilesh Deshbandhu Gupta Ramesh Swaminathan R. V. Satam ace uai aai irector Executive irector oa CO Company Secretary ated a Head Corporate Affairs AC

288 Notes

Lupin Limited | Annual Report 2019-20 289 Notes

290 Notes

Lupin Limited | Annual Report 2019-20 291 Notes

292 Notes

292 REGISTERED OFFICE Lupin Limited, Kalpataru Inspire, 3rd Floor Off ester Express Hiha atacru East Mumbai - 400 055, India. Tel: +91 22 6640 2323 ax

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