Sanofi India Ltd

To the Members of the Company

Your Directors have the pleasure of presenting their report and the Standalone and Consolidated Audited Accounts of your Company for the Financial Year ended December 31, 2023.

During the year ended December 31, 2023 your Company registered 28,511 million Revenue from Operations compared to 27,701 million in the previous year. Revenue from domestic retained business increased by 1.2% despite the inclusion of Company's flagship brand LantusR under NLEM during the year 2023. On a comparable basis (excluding NLEM impact) the domestic retained business grew by 5.4% over previous year. Net Revenue from India is 23,227 constituting 81.5% of the total revenue. The exports grew by 27%, year on year basis.

The Profit Before Tax and exceptional items increased from 7,323 million to 8,280 million, representing growth of 13.1% for the year ended December 31, 2023. Improvement in profit on account of product mix, improved realisation and savings in operational expenses by 6% through Operational efficiencies announced with for India strategy. The Profit After Tax for the year ended December 31, 2023 decreased from 6,206 million to 6,032 million representing degrowth of 2.8% mainly due to exceptional income in previous year.

Your Company does not propose to transfer any amount to the general reserves of the Company.

The Board of Directors ("Board") of the Company at its meeting held on May 10, 2023, approved the Scheme of Arrangement among the Company and Sanofi Consumer Healthcare India Limited, Company's wholly owned subsidiary ("SCHIL/Resulting Company") and their respective Shareholders and Creditors under Sections

230 to 232 of the Companies Act, 2013 ("Scheme"), to demerge its Consumer Healthcare Business into SCHIL.

The Board of Directors including the Independent Directors, approved the Scheme considering it in the interest of the

Company, the shareholders, and other stakeholders, which would unlock the value for all stakeholders. The rationale for the Scheme and Demerger, which would result in increased business synergies and unlocking of shareholder value, is set out below: a) separation of the pharmaceutical and consumer healthcare businesses of the Company will allow the Company and SCHIL to have independent and focused management, as well as independently pursue different opportunities and strategies for the growth of each respective business aligned to specific market dynamics; b) the demerger under the Scheme will enable a different operating model for the consumer healthcare business under SCHIL specific and fit for purpose for a fast-moving consumer healthcare company, which would lead to a greater ability to operate independently and positively shape the consumer healthcare environment in India; c) the requirements of the businesses of the Company (pharmaceutical businesses) and SCHIL (Consumer Healthcare Businesses upon demerger), including in terms of operations, nature of risks, competitive advantages, strategies, and regulatory compliances, are different, and the demerger will allow for enhancement of the business models of both the

Company and SCHIL; d) the shareholders, investors, analyst community, and other stakeholders will have greater understanding and visibility of both the pharmaceutical and consumer healthcare businesses; e) the proposed demerger will not only facilitate the pursuit of scale and independent growth plans but also more focused management and stronger leverage of specific global resources within the Sanofi group; f) the proposed demerger will de-risk both the businesses from each other and provide potential investors and other stakeholders with the option of investing in both businesses; and g) the proposed demerger will unlock value for the shareholders of the Company.

The Scheme was approved by the shareholders and creditors of the Company at the Court Convened meeting(s) held on December 18, 2023. Subsequently, the Company filed a petition before the Hon'ble National Company Law Tribunal, Mumbai ("Tribunal"). The Tribunal admitted the petition vide its Order dated January 16, 2024, and following the hearing, the Tribunal has reserved its judgment on the matter.

Following are the key aspects of the Scheme as approved by the shareholders

: i. The Scheme provides for the demerger of the consumer healthcare business from the Company into SCHIL

. ii. The Appointed Date under the Scheme is June 1, 2023, as rectified by the Tribunal. iii. Upon the Scheme becoming effective, all the assets and liabilities and the business pertaining to the consumer healthcare business of the Company shall stand transferred to and vest in SCHIL, as a going concern. Details of the assets and liabilities of SCHIL and the Company, pre and post the Scheme are available on the website of the Company. iv. Upon the Scheme becoming effective, 1 fully paid-up equity share of 10 each of SCHIL shall be issued and allotted to the equity shareholders of the Company for every 1 equity shares of 10 each held in the Company. v. Upon the Scheme becoming effective, the equity shares of SCHIL held by the Company will stand cancelled on or after the Effective Date (as set out in the Scheme) by operation of law, without payment of any consideration or any further act or deed by either of the Company and SCHIL. vi. Employees of Company pertaining to the Consumer Healthcare Business shall become the employees of SCHIL without any break or interruption in their services on no less favorable terms, in accordance with applicable law. vii. Upon the coming into effect of this Scheme, SCHIL shall record the assets and liabilities pertaining to the consumer healthcare business of the Company vested in it pursuant to this Scheme at the respective book values thereof, as appearing in the books of the

Company in accordance with the provisions set out in the Scheme.

The Scheme of Demerger approved by the Board, shareholders, creditors and Stock Exchanges is available on the website of the Company at the following link: Scheme of Arrangement - Sanofi India (sanofiindialtd.com).

The Stock Exchanges, namely, BSE Limited and the National Stock Exchange of India Limited, issued observation letters dated September 22, 2023, granting no-objection to the Scheme, subject to compliance with certain conditions as set out in the observation letters. The Company and SCHIL have complied and will continue to comply with all the conditions set out in the said observation letters.

There will be no change in the shareholding pattern of the

Company pursuant to the Scheme. Subject to necessary approvals, the equity shares of SCHIL will be listed on the BSE Limited and the National Stock Exchange of India Limited, in accordance with the SEBI Regulations and circulars issued thereunder.

The Scheme, if approved by the Hon'ble Tribunal, shall be effective from June 1, 2023, Appointed Date (as defined in the Scheme and set out in the order of the National Company Law Tribunal, Mumbai, dated November 24, 2023).

Your Directors at their meeting held on February 23, 2024 have recommended payment of final dividend of 117 per equity share of 10 each for the year ended December 31, 2023, considering the business and cash requirements of the Company. The dividend is subject to approval of members at the ensuing Sixty-Eighth Annual General Meeting (AGM) of the Company.

The dividend, if approved by the Members at the AGM scheduled on May 14, 2024, will result in cash outflow of 2,695 million.

Furthermore, in reference to the Scheme of Demerger, the National Company Law Tribunal (NCLT), through an order dated November 24, 2023, rectified the appointed date to June 1, 2023, thereby modifying the Scheme. The Company had filed a Petition before the NCLT, which was admitted by the NCLT via its Order dated January 16, 2024. Following the hearing, the NCLT has reserved its judgment on the matter.

In the above context, your Directors at the said meeting also approved an Interim Dividend of 50 per equity share of 10 each for the year ending December 31, 2023, which was paid on March 20, 2024.

The total dividend for the Financial Year 2023, including the proposed final dividend, amounts to 167 per equity share of 10 each. The total dividend results in payout of 65.13% of the profits of the Company.

Pursuant to the requirements of Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations'), the Dividend Distribution Policy of the Company is available on the Company's website at Code of Conduct and Policies - Sanofi India (sanofiindialtd.com)

In terms of the provisions of Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 (including amendments and modifications, thereof), 4.92 million of unpaid/unclaimed dividends were transferred during the year 2023 to the Investor Education and Protection Fund.

During the year, Ms. Annapurna Das (DIN: 08634664) resigned as a Non-Executive Director of the Company with effect from the close of business hours on July 31, 2023, consequent to her decision to pursue opportunities outside the Sanofi Group. The Board places on record its immense appreciation for her contribution during her tenure in the Company.

Mr. Cherian Mathew (DIN: 08522813) resigned as the Whole-Time Director of the Company, effective from the close of business hours on September 26, 2023. The Board noted and accepted his resignation at its meeting held on the same date. The Board places on record its immense appreciation for his contribution during his tenure in the Company.

The Board at its meeting held on September 26, 2023, based on the recommendation of the Nomination and Remuneration Committee, appointed Ms. Renee Amonkar (DIN: 10335917) as a Whole-Time Director of the Company with effect from September 26, 2023, for a period of three (3) years. Ms. Renee Amonkar is a pharmacist by profession with more than 30 years of Industrial experience in various fields of pharma manufacturing and supply. She started journey as a Research & Development Pharmacist and then moved on to be an executive in packing at E-Merck India. She joined Sanofi in December 1997 in packaging and grew to be head of manufacturing before becoming the Head of the Goa manufacturing site in 2021. She had played a key role in driving Sanofi India's Strategy of India for India for local manufacturing, and supply and business continuity.

The shareholders approved the appointment of Ms. Renee Amonkar as Whole-Time Director through Postal Ballot conducted in accordance with Sections 108 and 110 and other applicable provisions of the Companies Act, 2013 (hereinafter referred to as "the Act") read with the applicable Rules, Secretarial Standards and the Listing Regulations on November 05, 2023, with requisite majority.

Mr. Vaibhav Karandikar (DIN: 09049375) ceased to be the Chief Financial Officer and Whole-Time Director of the Company, effective from the close of business hours on November 30, 2023, consequent to his movement to another role within Sanofi Group and was re-designated as Non-Executive Director with effect from December 01, 2023.

The Board of Directors of the Company at its meeting held on November 08, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the appointment of Mr. Rachid Ayari (DIN: 10408699) as the Chief Financial Officer and Whole-Time Director of the Company with effect from December 01, 2023. Subject to the approval of the Members of the Company and the

Central Government, for a term of 3 (three) years effective December 01, 2023.

Rachid Ayari, an expat with over 7 years of experience at Sanofi and a 16-year tenure at Pfizer, brings a wealth of knowledge in major finance fields and a diverse international background, having worked across various countries from Africa to Russia & Central Asia. His expertise extends to financial management, working closely with cross-functional teams, and ensuring compliance with regulatory and corporate standards.

The Members approved appointment of Mr. Rachid Ayari as the Chief Financial Officer and Whole-Time Director of the Company through Postal Ballot on February 13, 2024, with requisite majority. The Company has made an application to the Central Government pursuant to the provisions of Sections 196, 197, 203 and other applicable provisions, read with Schedule V of the Act and Rules framed thereunder, to obtain approval for his appointment and is awaiting approval.

As on the date of this Report, Mr. Rodolfo Hrosz, Managing Director; Mr. Rachid Ayari, Whole-time Director and Chief Financial Officer; Ms. Renee Amonkar, Whole-time Director; and Ms. Radhika Shah, Head of Legal and Company Secretary, are the Key Managerial Persons of the Company.

Mr. Aditya Narayan, Chairman, Mrs. Usha Thorat, Chairperson of the Audit Committee and Nomination and Remuneration Committee and Mr. Rahul Bhatnagar, Chairman of Risk Management Committee, Stakeholders

Relationship Committee and Corporate Social

Responsibility Committee, are the Independent Directors of the Company.

The Company has received declarations from all

Independent Directors that they meet the criteria of independence as laid down under Section 149(6) of the

Act and the Listing Regulations and they have registered themselves with the Independent Director's Database maintained by the IICA (The Indian Institute of Corporate Affairs). In the opinion of the Board, the Independent Directors fulfill the conditions specified in these regulations and are independent of the Management.

Mr. Rodolfo Hrosz, Managing Director (DIN: 09609832), and Mr. Vaibhav Karandikar, Non-Executive Director (DIN: 09049375) are liable to retire by rotation at the ensuing Sixty-Eighth Annual General Meeting and being eligible, offer themselves for re-appointment. The Board of Directors recommend their re-appointment to the Members.

As required under Regulation 34 of the Listing Regulations, a Cash Flow Statement and the Consolidated Financial

Statements are part of the Annual Report.

As required by Regulation 34(2) of the Listing Regulations, a Management Discussion and Analysis Report forms part of this Report.

The state of the affairs of the business along with the financial and operational developments have been discussed in detail in the Management Discussion and Analysis Report.

The Business Responsibility and Sustainability Report for the year ended December 31, 2023, forms part of this Report.

As required under Regulation 34 of the Listing Regulations, a Report on Corporate Governance along with a Certificate of Compliance from the Statutory Auditors forms part of this Report.

Information on Conservation of Energy, Technology absorption, and Foreign Exchange earnings and outgo pursuant to Section 134(3)(m) of the Act, read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is given in Annexure - A to this Report.

During the year under review, Six (6) meetings of the Board were held. The dates, attendance of the Directors and other details of the meetings are given in the Report on

Corporate Governance. The maximum interval between any two meetings did not exceed 120 days, as prescribed by the Act and Listing Regulations.

The Independent Directors are regularly informed during meetings of the Board and Committees on the business strategy, business activities, manufacturing operations, updates on the pharmaceutical industry and regulatory updates. The Directors when they are appointed are given a detailed orientation on the Company, pharmaceuticals industry, Sanofi Global strategy, policies and Code of Conduct, regulatory matters, business, financial matters, human resource matters and corporate social responsibility initiatives of the Company. The details of familiarization programs provided to the Directors of the Company are mentioned in the Report on Corporate Governance and on the Company's website at Familiarization Programme - Sanofi India (sanofiindialtd.com).

During the year under review, the performance evaluation of the Board, Committees and Directors was conducted based on the criteria, framework and questionnaires approved by the Nomination and Remuneration Committee and the Board. The details of the performance evaluation exercise conducted by the Company are set out in the Report on Corporate Governance.

The Company has in place a Nomination and Remuneration Policy, formulated in accordance with Section 178 of the

Act and the Listing Regulations and same is available on Company's website at Code of Conduct and Policies - Sanofi India (sanofiindialtd.com)

The Policy provides guidance on selection and nomination of Directors to the Board of the Company, appointment of the Senior Management Personnel, and captures the Company's Leadership Framework for its employees. It explains the principles of the overall remuneration including short-term and long-term incentives payable to the Executive Directors, Key Managerial Personnel, Senior Management, and other employees of the Company. The remuneration paid to the Executive Directors, Key Managerial Personnel, and Senior Management is in accordance with the said Policy.

Further details form part of the Report on Corporate

Governance, and a Statement of Disclosure of Remuneration pursuant to Section 197 of the Act read with Rule 5(1) of the

Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014, is provided as Annexure - B to this Report.

The statement showing particulars of employees pursuant to Section 197 of the Act read with Rule 5(2) and 5(3) of the

Companies (Appointment and Remuneration of Managerial

Personnel) Rules, 2014, is not being sent to the Members along with this Annual Report in accordance with the provision of Section 136 of the Act. Any member interested in receiving the said statement may write to the Company Secretary stating their Folio No./DPID & Client ID.

During the year under review, a wholly owned subsidiary of the Company named Sanofi Consumer Healthcare India Limited ("SCHIL") was incorporated on May 10, 2023, to undertake the consumer healthcare business of Sanofi India Limited as part of Scheme of Demerger. As of the reporting date, SCHIL has not commenced any operations, and therefore, comparative financial results are not available.

A statement containing salient features of the financial statements of SCHIL in Form AOC-1 is annexed as Annexure - C to this Report. Further, pursuant to the requirements of Section 136 of the Act, the Standalone and Consolidated financial statements along with relevant documents and audited financial statements of SCHIL are hosted on the Company's website at Audited financial results of Subsidiary (sanofiindialtd.com).

Details pertaining to composition and re-constitution of the Audit Committee are included in the Report on Corporate Governance. During the year all the recommendations made by the Audit Committee were accepted by the Board.

As per the provision of Section 177(9) of the Act and Regulation 22 of the Listing Regulations, the Company is required to establish a Vigil Mechanism. The Company's Code of Conduct, Whistle blower, and other Governance Policies lays out the principles of highest ethical standards. The details of the Whistle blower Policy are provided in the Report on Corporate Governance forming part of this Report.

All related party transactions entered into during the year under review were on arm's length basis and in the ordinary course of business. There were no materially significant related party transactions by the Company with the Promoters, Directors, and Key Managerial Personnel which may have a potential conflict with the interests of the Company at large.

The Company has in place a Related Party Transactions

Policy, which is available on the Company's website at Code of Conduct and Policies - Sanofi India (sanofiindialtd.com). The Form AOC 2 envisages disclosure of material contracts or arrangements or transactions on an arm's length basis.

The details of the material related party transactions for the

Financial Year ended December 31, 2023, as per the Policy on dealing with related parties adopted by the Company are disclosed in Annexure D to this Report.

These transactions were in the ordinary course of business and at arm's length, duly certified by third-party experts.

The transactions were within the limits approved by the Members.

The Board has constituted a Corporate Social Responsibility

(CSR) Committee to monitor the implementation of CSR activities of your Company and also has in place a

Corporate Social Responsibility policy, which is available on the Company's website at Code of Conduct and Policies - Sanofi India (sanofiindialtd.com).

The CSR policy outlines the Company's approach towards Corporate Social Responsibility (CSR), focusing on areas where it can make a difference and have the most impact. The details of the composition of the CSR Committee, CSR policy, CSR initiatives, and activities undertaken during the year are given in the Annual Report on CSR activities in

Annexure E to this Report.

Your Company has implemented a mechanism for risk management and formulated a Risk Management Policy. The policy provides for the creation of a risk register, identification of risks and formulating mitigation plans.

Your Company has also constituted a Risk Management

Committee, details of which are disclosed in the Corporate Governance Report. As per the governance process described in the Policy, the Risk Management Committee reviews the risk identification, risk assessment and minimization procedures on a quarterly basis and updates the Audit Committee and the Board periodically.

The key risks impacting the Company are discussed in the Management Discussion and Analysis Report section forming part of this Report.

Your Company has in place, adequate Internal Financial Controls with reference to financial statements. During the year, such controls were tested, and no reportable material weaknesses in the design or operation were observed.

Your Company has not accepted any deposits from the public and as such no amount of principal or interest on deposits from the public was outstanding as of the date of the Balance Sheet.

The Company has not granted any loans, provided any guarantees, or invested in securities of any other body corporate other than investments in Sanofi Consumer Healthcare India Limited, the wholly owned subsidiary of the Company.

As required by Section 134(3) of the Act, your Directors, to the best of their knowledge and belief, confirm that:

1. in the preparation of the annexed accounts for the Financial Year ended December 31, 2023, all the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

2. your Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the Financial Year 2023 and of the profit of the Company for that year;

3. your Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. the said accounts have been prepared on a going concern basis;

5. internal financial controls to be followed by the Company have been laid down and that internal controls are adequate and are operating effectively; and

6. proper systems to ensure compliance with the provisions of all applicable laws have been devised and that such systems are adequate and operating effectively.

Pursuant to Section 148 of the Act read, with the Companies (Cost Records and Audit) Rules, 2014, the Company is required to maintain cost records. The accounts and records are made and maintained by the Company and are required to be audited. Your Directors have, at its meeting held on February 23, 2024, on the recommendation of the Audit Committee, appointed M/s. Kirit Mehta & Co.,

Cost Accountants to audit the cost accounts maintained by the Company for the F inancial Year ending December 31, 2024.

As required by the Act, the remuneration payable to the Cost Auditor is to be placed before the members in the General Meeting for their ratification. Accordingly, a resolution seeking ratification of the remuneration payable to M/s. Kirit Mehta & Co., as approved by the Audit Committee and the Board, is included in the Notice convening the Annual General Meeting of the Company. In the opinion of the Directors, considering the limited scope of audit, the proposed remuneration payable to the Cost Auditors would be reasonable and fair, and commensurate with the scope of work carried out by them.

M/s. Price Waterhouse & Co. Chartered Accountants LLP (Firm Registration Number 304026E/E-300009), were appointed as Statutory Auditors of your Company for a period of Five (5) years, commencing from the conclusion of the Sixty-sixth AGM held in the year 2022, until the conclusion of the Seventy-first AGM to be held in the year 2027.

The Statutory Auditors have confirmed their eligibility and submitted a certificate in affirming that they are not disqualified for holding the office of the Statutory Auditor. The report given by the Statutory Auditor on the financial statements of the Company forms part of the Annual Report. The Statutory Auditors have issued an unqualified audit report on the annual accounts of the Company for the year ended December 31, 2023.

During the year under review, the Statutory Auditors,

Cost Auditors and Secretarial Auditors have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under section 143(12) of the Act, details of which needs to be mentioned in this Report.

The Company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy.

During, the year 2023, the Company had received two complaints of alleged sexual harassment, which were disposed of. As of December 31, 2023 no complaints related to sexual harassment are pending for disposal.

Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014, your Directors had appointed M/s. Makarand M. Joshi & Co., a firm of Company Secretaries in Practice, to undertake the Secretarial Audit of your Company for the year ended December 31, 2023.

The comments made by the Secretarial Auditors are self-explanatory. Their report is annexed herewith as Annexure F to this Report.

The Company has complied with all applicable Secretarial

Standards issued by the Institute of Company Secretaries of India and adopted under the Act.

As required under Section 92(3) of the Act, Annual Return is hosted on the website of the Company at Annual Return

- Sanofi India (sanofiindialtd.com).

There have been no material changes and commitments, since the closure of the Financial Year ended December 31, 2023 up to the date of this Report, that would affect your Company's financial position.

There has been no change in the nature of your Company's business.

No significant or material orders have been passed by the Regulators, Courts or Tribunals that impact the going concern status and future operations of the Company.

Your Directors hereby clarify that the following disclosures are not applicable, considering that there were no such transactions in the year under review:

1. There has been no issue of Equity Shares with differential rights as to dividend, voting or otherwise.

2. There has been no issue of Equity Shares (including Sweat Equity Shares) to employees of your Company, under any scheme.

3. There was no change in share capital during the year under review.

4. Your Company has not resorted to any buy back of its Equity Shares during the year under review.

5. The Managing Director or the Whole-time Directors of your Company did not receive any remuneration or commission during the year from the subsidiary of the Company.

6. The details regarding the difference in valuation between a one-time settlement and valuation for obtaining loans from banks or financial institutions, along with reasons, are not applicable.

7. The details of any application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year, along with their status as at the end of the financial year are not applicable.

Your Directors place on record their deep appreciation to employees at all levels for their hard work, dedication and commitment. The Board also acknowledges the support and co-operation that your Company has been receiving from the medical fraternity, suppliers, distributors, retailers, business partners, government departments both at Centre & States, and all other stakeholders.

On behalf of the Board of Directors