Natco Pharma Ltd

The Board takes pleasure in presenting the 41st Annual Report of the Company along with the Audited Financial Statements and other reports for the year ended 31st March, 2024.

COMPANY OVERVIEW

NATCO has two business segments, Pharmaceuticals and Agrochemicals. Pharmaceuticals constitute a major portion of the revenue, where export formulations contribute a major portion of the pharmaceutical's revenue followed by API. Export formulations business focuses on high entry barrier and complex products and comprises of customers in US, Canada, Brazil, Asia-Pacific and other countries. API business is backward integrated making the business strategic in nature by servingits captive requirements. Capabilities in APIs include complex multi-step synthesis & scale-up, advanced synthetic/ separation technologies, containment facility for handling high potency APIs, synthesis of peptide (solid phase pharmaceuticals, oligo nucleotide pharmaceuticals etc., and a well-established process safety engineering lab. Our R&D capabilities are demonstrated by complex and niche product filings in formulations and API segments. Agrochemicals business segment is carried under Crop Health Sciences division of the Company. It has successfully launched broad-spectrum insecticide Chlorantraniliprole (CTPR) and its combination products in India across key agrarian states. It is focused on establishing a product portfolio through crop phenology analysis and also explore export opportunities.

FINANCIAL SUMMARY

(J in million)

The details of the Company's operations have been further discussed in detail in the Management Discussion and Analysis Report.

DIVIDEND

The Company declared three interim dividends for the FY 2023-24, the details of which are as follows:

The total dividend pay-out amounted to H 1,702 million resulting in a pay-out of 13.03% of the standalone profit after tax of the Company. The three Interim Dividends have been paid to all eligible shareholders. Accordingly, your Directors recommend that the above three interim dividends be treated as the final dividend of the Company for the Financial Year 2023-24. The Dividend Distribution Policy is available on the website of the Company at https://www.natcopharma.co.in/wp-content/ uploads/2019/08/Dividend-Distribution-Policy.pdf

TRANSFER TO RESERVES

The Company has not transferred any amount to the general reserve for the financial year ended 31st March, 2024.

SHARE CAPITAL

During the year under review, the Company has bought back 33,60,245 shares and the same were extinguished as on 31st March, 2024.

Accordingly, the issued and subscribed share capital of the Company as on 31st March, 2024, stood at H 358 million divided into 17,91,09,870 equity shares of H 2/- each as against H 365 million divided into 18,24,70,115 equity shares of H 2/- each as on 31st March, 2023.

BUYBACK OF EQUITY SHARES

The Board of Directors at their meeting held on 8th March, 2023, authorised the Company to buyback its fully paid-up equity shares of face value of H 2/- (Rupees Two only) each at a price not exceeding H 700/- (Rupees Seven Hundred only) per Equity Share (the Maximum Buyback Price) payable in cash for an aggregate amount not exceeding H 210,00,00,000/- (Rupees Two Hundred and Ten Crores only) (the Maximum Buy-back Size), from the shareholders of the Company excluding promoters, promoter group and persons who are in control of the Company, via the "Open Market" route through the stock exchanges mechanism, i.e., using the electronic trading facilities of the stock exchanges where the Equity Shares of the Company are listed (i.e., BSE Limited and National Stock Exchange of India Limited), in accordance with the provisions of Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018, as amended ("Buyback Regulations") and the Companies Act, 2013 (including the rules and regulations framed thereunder), as amended, and other applicable provisions (the process hereinafter referred toas the "Buyback").

The Buyback commenced on 21st March, 2023 in accordance with the provisions of Buyback regulations. In this regard, as on 12th May, 2023, the Company has bought back 34,47,295 (Thirty Four Lakhs Forty Seven Thousand Two Hundred and Ninety Five) Equity Shares at an average price of H 609.1712 (Rupees Six Hundred Nine and paisa One Seven One Two only) per Equity Share for an aggregate consideration of H 209,99,92,885.33 (Rupees Two Hundred and Nine Crores Ninety Nine Lakhs Ninety Two Thousand Eight Hundred Eighty Five and paisa Thirty Three only) which represents 100.00% of the Maximum Buyback Size. Accordingly, the Buyback Committee has approved the closure of Buyback pursuant to the terms of the Public Announcement, with effect from the closing of trading hours of 12th May, 2023, prior to the six months from the date of commencement of the Buyback.

Accordingly, the Company has made payment to the shareholders and extinguished all the shares bought back within stipulated time period and complied with all the regulatory filings.

DEPOSITS

During Financial Year 2023-24, the Company did not accept any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014 and therefore no amount of principal or interest was outstanding, as on the date of balance sheet.

CHANGE IN THE NATURE OF BUSINESS, IF ANY

During the year under review, there was no change in the nature of business of the Company or any of its Subsidiaries.

SUBSIDIARIES

The Company has eleven (11) international subsidiaries including (2) step-down subsidiaries as on 31st March, 2024. The consolidated financial statement of the Company and all its subsidiaries prepared under Indian Accounting Standards (Ind AS) specified under Section 133 of the Companies Act, 2013 form part of the annual report. During the year under review, the Company has incorporated the following subsidiaries, namely:

1. PT. NATCO Lotus Farma in Indonesia, which was approved by the Board of Directors at their meeting held on 20th April, 2023.

2. NATCO PHARMA COLOMBIA SAS in Columbia which was approved by the Board of Directors at their meeting held on 29th May, 2023.

3. NATCO PHARMA UK LIMITED in United Kingdom, which was approved by the Board of Directors at their meeting held on 9th August, 2023.

The Company has not acquired any other Subsidiary Company nor any of the existing Subsidiary Company(s) are ceased to become Subsidiary of the Company during the Financial Year 2023-24 except the above-mentioned subsidiaries.

Further, a Statement containing the salient features of the Financial Statements of the Subsidiaries in the prescribed Form AOC-1, is attached as "Annexure - I" to the Board's Report.

This Statement also provides the details of the performance and financial position of each Subsidiary.

In accordance with Section 136 of the Companies Act, 2013, the Audited Financial Statements and related information of the Subsidiaries, where applicable, will be available for inspection during regular business hours i.e., from 9:00 a.m. to 5:30 p.m. at the Company's registered office in Hyderabad, Telangana, India.

MATERIAL SUBSIDIARIES

As per Regulation 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), a "material subsidiary" to mean a subsidiary, whose income or net worth exceeds ten percent of the consolidated income or net worth respectively, of the listed entity and its subsidiaries in the immediately preceding accounting year. None of the Subsidiary Companies are material subsidiary to the Company based on the income or net worth as on March 31,2024.

However, NATCO Pharma (Canada) Inc., Canada is the material subsidiary of the Company based on the income or net worth of the Company for Financial Year 2020-21 and will continue as material subsidiary as per Regulation 3 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

In addition to the above, Regulation 24 of the Listing Regulations requires that at least one Independent Director on the Board of Directors of the listed entity shall be a Director on the Board of Directors of an unlisted material subsidiary, whether incorporated in India or not. For the purpose of this Regulation, material subsidiary means a subsidiary, whose income or net worth exceeds twenty percent of the consolidated income or net worth respectively, of the listed entity and its subsidiaries in the immediately preceding accounting year. Accordingly, the said provision of the appointment of an Independent Director of the Company in the Board of the material subsidiary Company is not applicable, since, the prescribed limits are not exceeded by the Company.

The other requirements of Regulation 24 of the Listing Regulations with regard to Corporate Governance requirements for Subsidiary Companies have been complied with.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

The Company provides investments, loans and guarantees to its subsidiaries /other Companies for its business purpose. Details of investments, loans and guarantees covered under Section 186 of the Companies Act, 2013, form part of the notes to the financial statements provided in this Annual Report.

CORPORATE GOVERNANCE AND ADDITIONAL SHAREHOLDERS INFORMATION

Pursuant to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), a detailed report on the Corporate Governance systems and practices of the Company is given under Corporate Governance Report which is part of this Annual Report.

A certificate from CS D. Renuka, Company Secretary in Practice (C.P. No. 3460) on the compliance with the conditions of Corporate Governance is part of the Corporate Governance Report.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

A detailed report on the Management Discussion and Analysis is provided as a separate chapter in this Annual Report.

BOARD OF DIRECTORS

In accordance with the provisions of the Companies Act, 2013, Dr. D. Linga Rao (DIN: 07088404) and Dr. Pavan Ganapati Bhat (DIN: 09691260), Directors are liable to retire by rotation and being eligible offers themselves for reappointment at the ensuing Annual General Meeting of the Company.

During the year under review, there has been no change in the Board of Directors of the Company, however the Board of Directors of the Company at their meeting held on 14th February, 2024, based on the recommendations of the Nomination and Remuneration Committee, approved the appointment of Sri. A.D.M. Chavali (DIN:00374673) and Sri D. Vijaya Bhaskar (DIN: 07158951) as Independent Director(s) of the Company for a period of 5 (five) years i.e., from 1st April, 2024 to 31st March, 2029 and the same was approved by the members of the Company through postal ballot on 26th March, 2024.

Further, upon the recommendations of the Nomination and Remuneration Committee, the Board of Directors of the Company at their meeting held on 14th February, 2024 approved the appointment/re-appointment of the following Directors of the Company for a period of 2 (two) years w.e.f. 1st April, 2024 to 31st March, 2026 and the same was approved by the members of the Company through postal ballot on 26th March, 2024:

1. Sri V.C. Nannapaneni (DIN: 00183315) as Chairman & Managing Director of the Company.

2. Sri Rajeev Nannapaneni (DIN: 00183872) as Vice Chairman & Chief Executive Officer of the Company.

3. Sri P.S.R.K. Prasad (DIN: 07011140) as Director and Executive Vice President (Corporate Engineering Services) of the Company.

4. Dr. D. Linga Rao (DIN:07088404) as Director and President (Tech. Affairs) of the Company.

5. Dr. Pavan Ganapati Bhat (DIN:09691260) as Director and Executive Vice President (Technical Operations) of the Company.

Further, Sri G.S. Murthy (DIN:00122454) and Sri D.G. Prasad (DIN: 00160408), Independent Director(s) of the Company completed their 2nd term of 5 (five) years as Independent Directors of the Company w.e.f. 1st April, 2024.

Further, Dr. M.U.R. Naidu, Independent Director of the Company vacated the office upon his demise on July 30, 2024.

Further, the Board of Directors at their meeting held on 12th August, 2024, based on the recommendations of Nomination and Remuneration Committee approved the appointment of Sri Lakshminarayana B. (DIN: 02766709), Dr. Kantipudi Suma (DIN: 02734369) and Sri Nitin Jain (DIN: 00136245) as Additional Directors (Non-Executive Independent Directors) of the Company for a period of 5 (five) years i.e., from 12th August, 2024 till 11th August, 2029 subject to approval of the shareholders of the Company at the ensuing Annual General Meeting of the Company.

BOARD EVALUATION

A formal annual evaluation has been made by the Board of its own performance, Chairman of the Board, its Committee(s) and individual Director(s). The performance evaluation has been done by the entire Board of Directors, excluding the Director being evaluated. Various evaluation techniques are used to assess the performance of the Directors. The Directors have participated in this evaluation process. The Independent Directors in their separate meeting have also evaluated the performance of the Chairman of the Company, Non-Independent Directors and the Board as a whole.

APPOINTMENT OF DIRECTOR(S), KM PS AND REMUNERATION POLICY

The assessment and appointment of members to the Board is based on a combination of criterion that includes ethics, personal and professional stature, domain expertise, gender diversity and specific qualification required for the position. The Independent Board member is also assessed on the basis of independence criteria defined in Section 149(6) of the Companies Act, 2013 and Regulation 16(1 )(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations").

In accordance with Section 178(3) of the Companies Act, 2013 and on recommendations of Nomination and Remuneration Committee, the Board adopted a remuneration policy for Directors, Key Managerial Personnel (KMPs) and Senior Management which is available on the website of the Company. https://www.natcopharma.co.in/wp-content/uploads/2024/08/ Remuneration-Policy.pdf

DECLARATION BY INDEPENDENT DIRECTORS

All Independent Directors of the Company have submitted requisite declarations confirming that they continue to meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"). The Independent Directors have also confirmed that they have complied with the Company's Code of Conduct.

LEAD INDEPENDENT DIRECTOR

The Board of Directors of the Company has appointed Sri T.V.Rao, Chairperson of Independent Directors meeting as lead Independent director to ensure robust independent leadership of the Board.

The role of lead independent director is to provide leadership to the Independent Directors, liaises on behalf of the Independent Directors and ensures the Board's effectiveness in maintaining high-quality governance of the organization and effective functioning of the Board.

REGISTRATION OF INDEPENDENT DIRECTORS IN INDEPENDENT DIRECTOR'S DATABANK

All the Independent Directors of the Company have been registered and are members of Independent Directors Databank maintained by Indian Institute of Corporate Affairs.

CONFIRMATION FROM THE BOARD

All the Independent Directors of the Company have given their respective declaration/disclosure(s) under Section 149(7) of the Act and Regulation 25(8) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") and have confirmed that they fulfil the independence criteria as specified under Section 149(6) of the Act and Regulation 16 of the Listing Regulations and have also confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties with an objective independent judgment and without any external influence. Further, the Board after taking these declaration/ disclosure(s) on record and acknowledging the veracity of the same, concluded that the Independent Directors are persons of integrity and possess the relevant expertise and experience to qualify as Independent Directors of the Company and are Independent of the Management.

OPINION OF THE BOARD

The Board opines that all the Independent Directors of the Company strictly adhere to corporate integrity, possesses requisite expertise, experience and qualifications to discharge the assigned duties and responsibilities as mandated by the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 diligently.

NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES AND OTHER COMMITTEES

The Board currently has eight (8) Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Compensation Committee, Corporate Social Responsibility Committee, Risk Management Committee, Committee Dealing with Land Property and Buyback Committee.

A detailed update on the Board, its composition, detailed charter including terms of reference of various Board Committees, number of Board and Committee meetings held during the Financial Year 2023-24 and attendance of the Directors is provided in the Corporate Governance Report, which forms part of the Annual report.

All the recommendations made by the Committee(s) of the Board including the Audit Committee were accepted by the Board.

MEETING OF INDEPENDENT DIRECTORS

A separate meeting of the Independent Directors was held on 14th February, 2024, inter-alia, to discuss evaluation of the performance of Non-Independent Directors, the Board as a whole, evaluation of the performance of the Chairman, taking into account the views of the Executive and Non- Executive Directors and the evaluation of the quality, content and timeliness of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties.

The Independent Directors expressed satisfaction with the overall performance of the Directors and the Board as a whole.

BUSINESS RISK MANAGEMENT

The Company has a risk management mechanism in place to manage uncertainties through identification, analysis, assessment, implementing and monitoring to reduce the impact of risks to the business which is discussed in detail in the Management Discussion and Analysis section of this Annual Report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN END OF FINANCIAL YEAR AND DATE OF REPORT

No material changes and commitments have occurred after the close of the financial year till the date of this report which may affect the financial position of the Company.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

The Company has adopted the Business Responsibility and Sustainability Report (BRSR) in the format specified by SEBI for Financial Year 2023-24. The BRSR is forming part of this Annual Report.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate the Internal Financial Controls commensurate with the business operations of the Company which are operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosure.

INSURANCE

The Company's plant, property, equipment and stocks are adequately insured against all major risks. The Company also has appropriate liability insurance covers particularly for product liability and clinical trials. The Company has also taken Director's and Officer's Liability Policy to provide coverage against the liabilities arising on them.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act, 2013 in relation to Financial Statements of the Company for the year ended 31st March, 2024, the Board of Directors state that:

a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) The Directors had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year and of the profit and loss of the Company for that period;

c) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) The Directors had prepared the annual accounts on a going concern basis;

e) The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

f) The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

RELATED PARTY TRANSACTIONS

In accordance with Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of contract(s) or arrangement(s) entered into by the Company with related parties referred to in Section 188(1) in Form AOC-2 is attached as "Annexure - II" to this Board's Report.

The details of related party disclosures form part of the notes to the Financial Statements provided in this Annual Report.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company believes in upholding professional integrity and ethical behaviour in the conduct of its business. To uphold and promote these standards, the Company has a Vigil Mechanism / Whistle Blower Policy which serves as a mechanism for its Director(s) and employee(s) to report genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Code of Conduct without fear of reprisal. The policy also provides employee(s) access to the Chairperson of the Audit Committee under certain circumstances. The details of the procedures are also available on the website of the Company https://www.natcopharma.co.in/wp-content/uploads/2024/08/ whistle-blower-policy-1.pdf

A brief note on the Whistle Blower Policy is also provided in the Report on Corporate Governance, which forms part of this Annual Report.

INTERNAL COMPLAINTS COMMITTEE

The Company has Internal Complaints Committees in place in all the units in line with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. A brief note on the same is provided in the Report on Corporate Governance, which forms part of this Annual Report.

AUDITORS

STATUTORY AUDITORS

The members of the Company at their Annual General Meeting held on September 5, 2019 appointed M/s. B S R & Associates LLP (Firm Registration No. 116231W/W-100024) as the Statutory Auditors of the Company to act as such from the conclusion of 36th Annual General Meeting (AGM) held for the Financial year 2018-19 till the conclusion of the 41st AGM to be held for the Financial Year 2023-24.

Pursuant to Section 139 of the Companies Act, 2013 and the rules made thereunder and based on the recommendation of the Audit Committee of the Company, the Board of Directors of the Company have appointed M/s. B S R and Co (ICAI FRN: 128510W) as the Statutory Auditors of the Company to hold office for a period of five (5) years i.e. from the conclusion of the ensuing Annual General Meeting till the conclusion of the 46th Annual General Meeting of the Company to be held for the financial year 2028-2029, subject to the consent of the members of the Company at the ensuing Annual General Meeting.

SECRETARIAL AUDITOR

Pursuant to Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, CS B. Kiran Kumar with Certificate of Practice (CP) No. 15876, Proprietor, M/s. B K & Associates, a Practicing Company Secretary conducted the Secretarial Audit of the Company for Financial Year 2023-24.

The Secretarial Audit Report in Form No. MR-3 is attached as "Annexure - III" to this Board's Report.

Upon recommendation of the Audit Committee, the Board has re-appointed CS B. Kiran Kumar (CP No. 15876) Proprietor, M/s. B K & Associates, a Practicing Company Secretary as Secretarial Auditor of the Company for the financial year 2024-25.

COST AUDITORS

Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 and the Companies (Cost Records and Audit) Rules, 2014, the Company maintains the Cost Audit records which are required to be maintained.

The Board on the recommendation of the Audit Committee, re-appointed M/s. S.S. Zanwar & Associates (Firm Registration No.100283) as Cost Auditors of the Company for Financial year 2024-25. The provisions also require that the remuneration of the Cost Auditors be ratified by the shareholders and accordingly the same is put forward to the shareholders for their ratification in the ensuing Annual General Meeting. The Cost Audit report for the Financial Year 2023-24 will be filed with the Central Government within the stipulated timeline and the relevant Cost Audit report for FY 2022-23 was filed within the due date to the Central Government.

INTERNAL AUDITORS

The Board based on the recommendations of the Audit Committee has re-appointed M/s. Grant Thornton Bharat LLP as Internal Auditors of the Company for FY 2024-25 and the Internal Auditors will report to the Audit Committee and the Board of Directors of the Company.

AUDITORS' QUALIFICATIONS/ RESERVATIONS/ ADVERSE REMARKS/ FRAUDS REPORTED

There are no Auditors' Qualifications or reservations or adverse remarks on the Financial Statements of the Company. The Auditors have not reported any frauds to the Audit Committee as prescribed under Section 143(12) of the Companies Act, 2013.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE COURTS/REGULATORS

During Financial year 2023-24, there were no significant and/ or material orders, passed by any Court or Regulator or Tribunal, which may impact the going concern status or the Company's operations in future.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The Board formulated a Corporate Social Responsibility (CSR) Policy which is in full force and operation and is subject to monitoring by the CSR Committee of Directors from time to time.

The details about the CSR initiatives taken during the Financial Year 2023-24 are discussed in a separate head "Corporate Social Responsibility" which forms a part of this Annual Report.

The Annual Report on CSR activities of the Company is attached as "Annexure - IV" and Impact Assessment report issued by M/s. Deloitte Touche Tohmatsu India LLP is available on the website of the Company at https://www.natcopharma.co.in/ wp-content/uploads/2024/05/Impact-Assessment-of-Natco- Pharma-Ltds-CSR-Support 24.05.24.pdf.

TRANSFER OF UNPAID AND UNCLAIMED DIVIDEND AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 124(5) of the Companies Act, 2013, the declared dividends which remained unpaid or unclaimed for a period of seven years, have been transferred by the Company to the Investor Education and Protection Fund (IEPF) established by the Central Government pursuant to Section 125 of the said Act the details of which are disclosed in the Corporate Governance Report.

CREDIT RATING

The Company's credit ratings from ICRA on long term borrowings is "AA" and on short term borrowings is "A1+".

PARTICULARS OF EMPLOYEES

The information as required under Section 197 of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are attached as "Annexure-V" to this Board's Report.

The information required under Rule 5(2) and (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in an Annexure forming part of this Report.

In terms of the second proviso to Section 136 of the Act, the Report and Accounts are being sent to the Members excluding the aforesaid Annexure. The said annexure is open for inspection at the Registered Office of the Company and any member interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company.

CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

The details of Energy Conservation, Research and Development, Technology Absorption and Foreign Exchange Earnings and Outgo as required under Section 134(3)(m) of the Companies Act, 2013, read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached as "Annexure-VI" to this Board's Report.

ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31st March, 2024 is available on the Company's website on https://www.natcopharma.co.in/ investors/annualreturn/

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India.

GREEN INITIATIVE

To preserve environment, the Company has undertaken number of green initiatives which not only reduce burden on environment but also ensure secured dissemination of information. Such initiatives include energy saving, water conservation and usage of electronic mode in internal processes and control, statutory and other requirement(s).

The Company's unit in Mekaguda has recently received a "GreenCo - Gold Rating" award from Confederation of Indian Industry (CII) for their initiatives taken for the environmental sustainability.

ACKNOWLEDGEMENTS

The Board wish to place on record their appreciation to shareholders, Government Authorities, banks, business partners, medical practitioners and other stakeholders for the assistance, co-operation and encouragement extended to the Company. The Board also commend the continuing commitment and dedication of the employees at all levels, which has been critical for the Company's success. The Board look forward to their continued unstinted support in future also.